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HomeMy WebLinkAboutAgenda Report - November 4, 2020 C-13AGENDA ITEM Cawl,3 CITY OF LODI COUNCIL COMMUNICATION TM AGENDA TITLE. Adopt Resolution Authorizing City Manager to Execute First Amendment to Second Amended and Restated Ground Lease with Northern California Power Agency MEETING DATE: November 4, 2020 PREPARED BY: Public Works Director RECOMMENDED ACTION: Adopt resolution authorizing City Manager to execute First Amendment to Second Amended and Restated Ground Lease with Northern California Power Agency. BACKGROUND INFORMATION: In 1993, the Northern California Power Agency (NCPA) leased property from the City of Lodi for the purposes of building and operating a 49.9 Megawatt power plant (CT2). The initial lease include five acres located at the White Slough Water Pollution Control Facility. In 2010, the City and NCPA agreed to amend the ground lease ("Amended and Restated Ground Lease") by adding an additional five acres for the purposes building and operating a 300 Megawatt power plant, referred to as the Lodi Energy Center (LEC). The ground lease was once again amended in 2013 ("Second Amended and Restated Ground Lease") primarily for the purpose of clarifying lease payments. As operations have expanded, NCPA approached the City requesting to amend the Second Amended Ground Lease to include a 2.3 acre site located just west of LEC, which is referred to as the "Annex" (Exhibit A). NCPA is proposing to utilize this space as a storage and laydown area to support the maintenance and operational needs of both power plants. Staff has reviewed the proposed request and determined the proposed site is not used by the City of Lodi for wastewater treatment operations and is available for this purpose throughout the term of the Second Amended Ground Lease. If approved, NCPA will improve the Annex area by compacting the soil and placing a rock base along with a perimeter fence. The cost of this work will be borne by NCPA. Staff recommends authorizing City Manager to execute First Amendment to Second Amended and Restated Ground Lease with Northern California Power Agency. FISCAL IMPACT: NCPA proposes to pay the City an additional $20,310 per year in accordance with the terms of the Second Amended Ground Lease. FUNDING AVAILABLE: Not applicable. CES/CES/tc Attachments APPROVED: KAWP\C0UNCIL\2020\NCPA Ground Leasse.doc CUU2 Charles E. Swimley, Jr. Public Works Director , City Manager 10/22/2020 EXHIBIT 2 � a46 x GS-AGY-2013-001 m a v N U CLO L f0 Q q�p O m LL- L i+; N 4l A public avlllt, NCPA NORTHERN CALIFORNIA POWER AGENCY 651 Commerce Drive Roseville, CA 95676 (916) 761-3636 www.ncpa.com October 19, 2020 Via United Parcel Service Delivery The City of Lodi Attn: Janice Magdich/Charles Swimley 221 West Pine Street Lodi, CA 95240 SUBJECT: First Amendment to Second Amended and Restated Ground Lease between the City of Lodi and Northern California Power Agency To Whom It May Concern: Enclosed please find two duplicate originals of the First Amendment to the Second Amended and Restated Ground Lease Agreement between the City of Lodi and NCPA for execution. Please have the designated signatory execute the agreement on page 3. Please return both signed documents to me at our corporate office address listed above. This agreement will be before the NCPA Commission for approval at its October 29, 2020 Commission Meeting. After execution by NCPA, we will insert the agreement effective date and return a duplicate original of the fully executed agreement to you for your files. If you have any questions, please do not hesitate to contact me at (916) 781-4299 or I Irht I .scli -1igiira a az nC .cc i.ii Sincerely, Michelle A. Schellentrager Administrative Assistant — Generation Services (916) 781-4299 /ms Enclosure(s) CPA FIRST AMENDMENT TO SECOND AMENDED AND RESTATED GROUND LEASE BY AND BETWEEN THE CITY OF LODI AND NORTHERN CALIFORNIA POWER AGENCY This First Amendment to Second Amended and Restated Ground Lease Dated April 29, 2013 ("First Amendment") is entered into between the City of Lodi, a California municipality ("Lodi" or "Landlord") and Northern California Power Agency ("Agency" or "Tenant"), a public entity, with its main office located at 651 Commerce Drive, Roseville, CA 95678, (collectively the "Parties") as of , 2020 ("Effective Date"). RECITALS A. WHEREAS, the Parties entered into a Ground Lease dated February 17,1993; and B. WHEREAS, the Parties entered into an Amended and Restated Ground Lease dated March 22, 2010; and C. WHEREAS, the Parties entered into the Second Amended and Restated Ground Lease dated April 29, 2013 (the "Second Amended Lease"); and D. WHEREAS, the Parties desire to amend the Second Amended Lease by adding additional land (as defined in Section 1.1 below and referenced as the "Annex") to the Leased Premises or Premises as those terms are defined in Section 1.9 of the Second Amended Lease; and E. WHEREAS, the Parties desire to increase the annual rent to reflect the Agency's use of the Annex; and NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree to amend the Second Amended Lease as follows: Section 1. DEFINITIONS. The additional terms used and defined below will added to the Second Amended Lease and have the meanings as set forth in this Section 1. All capitalized terms not defined herein have the meanings set forth in the Second Amended Lease. 1.1. Annex. "Annex" is the additional lease area to the west of the Leased Premises or Premises as more fully described in the legal description and depicted in the graphic provided in Exhibit 1, attached hereto and made a part hereof. 1.2. Annex Annual Rent. "Annex Annual Rent" shall be the annual sum provided in Section 2.1 below and paid by Agency to Lodi for the Annex. 1.3. Leasee! Premises or Premises. "Leased Premises" or "Premises" as defined in Section 1.9 of the Second Amended Lease is increased to include the Annex. Nortnem a i omia Power Agency CRy of Lodi First Amendment to Second Amended Lease GS-AGY-2013.001 Page 1 Section 2. LEASE TERMS. 2.1 Rent. On or before July 1 of each year during the Term of this First Amendment, Tenant agrees to pay to Landlord in advance as the Annex Annual Rent the sum of Twenty Thousand Three Hundred Ten Dollars ($20,310) for the following Lease Year (i.e., each twelve (12) month period during the Term of this Lease, commencing on July 1 and ending on June 30 of the following calendar year). The first year Annex Annual Rent will be prorated from the Effective Date to the end of the twelve (12) month period (i.e., June 30, 2021). 2.2 Landlord's Retained Rights, The Annex contains monitoring wells that belong to the Landlord. The Landlord will continue to own, retain rights of access to and ability to maintain the wells. Landlord's monitoring wells are shown on Exhibit 2 ("Monitoring Wells"), attached hereto and made a part hereof. Landlord hereby retains the right to access the Annex, upon forty eight (48) hours written notice to Tenant (except in the event of emergency), to repair, maintain or remove the Monitoring Wells. Landlord agrees not to interfere with Tenant's activities on the Premises and will expeditiously repair or replace any damage that Landlord causes on the Premises at Landlord's sole expense. The Landlord would consider a request by Tenant to, at its sole expense, relocate Landlord's existing Monitoring Wells that lie within the limits of the Annex and Leased Premises, under the condition Landlord receives written authorization from the Regional Water Quality Control Board for the proposed relocation of the Monitoring Wells. The schedule for any relocation shall be at a time mutually agreed upon by the Parties. Tenant agrees to construct any relocated Monitoring Wells to standards acceptable to Landlord and the Regional Water Quality Control Board. 2.3 Term. Once executed the term of this First Amendment will begin on the Effective Date and shall run coterminous with the Second Amended Lease. 2.4 Termination. Tenant may terminate this First Agreement at any time upon six (6) months advance written notice. Section 3. COUNTERPARTS. This First Amendment may be executed in counterparts each of which is deemed an original, and all such counterparts constitute one and the same agreement. Except as otherwise stated in this First Amendment, all other terms and conditions of the Second Amended Lease remain unchanged and applicable to Tenant's lease of the Annex from Landlord. SIGNATURES ON FOLLOWING PAGE N Northam CaIrromia Power Agency City of Lodi First Amendment to Second Amended Lease G5-AGY-2013-001 Page 2 The Parties have executed this First Amendment as of the latest date signed by either Party and such date shall become the Effective Date. fX illoUgyq CITY OF LODI, a Municipal Corporation Stephen Schwabauer, City Manager ATTEST: Jennifer Cusmir, City Clerk APPROVED AS TO FORM: Janice D. Magdich, City Attorney jdm Northam California Power Agency City of Lodi First Amendment to Second Amended Lease NORTHERN CALIFORNIA POWER AGENCY Randy S. Howard, General Manager ATTEST: Cary Padgett, Assistant Secretary of the Commission APPROVED AS TO FORM: Jane E. Luckhardt, General Counsel GS-AGY-2013-001 Page 3 EXHIBIT 1 ANNEX LEGAL DESCRIPTION Northern California Power Agency GS-AGY-20 3-001 City of Lodi First Amendment to Second Amended Lease Page 4 EXHIBIT 1- PAGE 1 LEGAL DESCRIPTION LOCATED VN W a7Y OF LOR COWVTY OF SAN 40100, STATE OF CAUfA A MARE PARACIKARLY DESOR119ED AS FOLLOWS BEANO A P0R7IGW OF LAW LOG WW#V 1HE EAST 1%1 OF PE SOUTi4EAST 1/4 GIF SECTTOW 23 AND w7H#V TTS' SOUTH 1/2 CF SECTTOW 24 TOWNP S AWN RAW 5 EAST, MOUNT DIA&O BASE AND MERIOVAN, AS SHOW OW REOOIRD OF Si &EY FEED NV 8" 7, PACE 9, IN THE ala OF AW COUNTY RECORDED OF S41D L1 ry.. 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IMPONT, 778 Job No NNS GS-AGY-2013-001 EXHIBIT 2 MONITORING WELLS Northern California Power Agency City of Lodi First Amendment to Second Amended Lease GS-AGY-2013-001 Page 7 Ilk A . * -- -T- --,m 1 -.0 1 6 Ir LIV RESOLUTION NO. 2020-252 A RESOLUTION OF THE LODI CITY COUNCIL AUTHORIZING THE CITY MANAGER TO EXECUTE THE FIRST AMENDMENT TO SECOND AMENDED AND RESTATED GROUND LEASE WITH NORTHERN CALIFORNIA POWER AGENCY WHEREAS, in 1993, the Northern California Power Agency (NCPA) leased property from the City of Lodi for the purposes of building and operating a 49.9 Megawatt power plant (CT2); and WHEREAS, the initial lease include five acres located at the White Slough Water Pollution Control Facility; and WHEREAS, in 2010, the City and NCPA agreed to amend the ground lease ("Amended and Restated Ground Lease") by adding an additional five acres for the purposes of building and operating a 300 Megawatt power plant, referred to as the Lodi Energy Center (LEC); and WHEREAS, the ground lease was once again amended in 2013 ("Second Amended and Restated Ground Lease") primarily for the purpose of clarifying lease payments; and WHEREAS, as operations have expanded, NCPA approached the City requesting to amend the Second Amended Ground Lease to include a 2.3 acre site located just west of LEC, which is referred to as the "Annex;" and WHEREAS, staff recommends authorizing the City Manager to execute the First Amendment to Second Amended and Restated Ground Lease with Northern California Power Agency. NOW, THEREFORE, BE IT RESOLVED that the Lodi City Council does hereby authorize the City Manager to execute the First Amendment to Second Amended and Restated Ground Lease with Northern California Power Agency; and BE IT FURTHER RESOLVED, pursuant to Section 6.3q of the City Council Protocol Manual (Res. No. 2019-223), the City Attorney is hereby authorized to make minor revisions to the above -referenced document(s) that do not alter the compensation or term, and to make clerical corrections as necessary. Dated: November 4, 2020 I hereby certify that Resolution No. 2020-252 was passed and adopted by the City Council of the City of Lodi in a regular meeting held November 4, 2020, by the following vote: AYES: COUNCIL MEMBERS — Chandler, Nakanishi, and Mayor Kuehne NOES: COUNCIL MEMBERS — None ABSENT: COUNCIL MEMBERS — Mounce ABSTAIN: COUNCIL MEMBERS — None JENNIFER CUSMIR Y City Clerk 2020-252