HomeMy WebLinkAboutMinutes 11/22/1996 3410
CITY COUNCIL SPECIAL MEETING
Port Angeles, Washington
November 22, 1996
CALL TO ORDER o Deputy Mayor Braun called the special meeting of the Port Angeles City Council to
SPECIAL MEETING: order at 1:32 p.m.
ROLL CALL: Members Present: Deputy Mayor Braun, Councilmembers Doyle, Hulett,
McKeown, and Wiggins.
Members Absent: Mayor Ostrowski and Councilmember Campbell.
Staff Present: Manager Pomeranz, Assistant Attorney Dickson, Clerk
Upton, and K. Ridout.
Public Present: E. and B. Kelly.
Lease Agreement with Deputy Mayor Braun indicated the purpose of this meeting was to consider a lease
Bonny's Bakery agreement with Bouny's Bakery for the old Senior Center. Property Manager Ridout
had previously distributed draft copies of the lease agreement and, at this time, he
advised the Council the major change to the proposed lease had to do with the rental.
More specifically, the lessee had asked for binding arbitration, which the City does
not typically utilize unless necessary. The lease agreement under consideration
Specifies negotiation of a second ten (10) year lease. If a fair market value cannot
be agreed upon, the City may impose a 10%~/inc. rease in the rental rate or may
submit the issue to binding arbitration. ~
Councilman Doyle noted a 10% increase would not accommodate normal inflation
that would have occurred over the first 10-year term. Assistant Attorney Dickson
explained the arbitration process, whereby a determination would be made as to the
fair rental market value of the property at the time of negotiation. Manager
Pomeranz expressed the opinion that such a process would not be to the City's
disadvantage, because of the fact the rent would be established based on the fair
market value.
Discussion was held concerning the repair and renovation to take place, and
Councilman Wiggins inquired as to who would be responsible if the repairs were to
exceed the $80,000 figure. Edward Kelly, lessee, expressed confidence that the
repairs could, in fact, be accomplished for $80,000. Also, in considering seismic
repairs to be made, Councilman Doyle was assured there was a set of plans setting
forth the specific repairs to be made. Mr. Kelly agreed that any repair costs
exceeding $80,000 would be the Kelly's responsibility.
In response to an inquiry from Councilman Doyle regarding leasehold tax, Property
Manager Ridout explained that the tax is based on the value of the building. At the
present value, the rental amount is slightly higher. In the event the leasehold tax
amount is increased, it was agreed the Kelly's would be responsible for the payment
of the tax, in keeping with State law.
Discussion followed concerning specific aspects of the lease agreement, after which
Councilmember McKeown moved to approve the lease as presented. The motion
was seconded by Councilman Hulett and carried unanimously.
ADJOURNIVIENT: The meeting was adjourned it 2: ~~~/~x~,,
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