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Item 10ACity of Southlake, Texas MEMORANDUM January 22, 2004 TO: Billy Campbell, City Manager FROM: Malcolm Jackson, Director of Community Services (xt. 1527) SUBJECT: Approval of action to provide contract extension and termination date for Tucker property Action Requested: City Council approval of contract extension and termination date for lease of Tucker property. Background Information: The city currently has a yearly lease with original property owner Marilyn Tucker, who in turn sub - leases the acreage, ranch house and barns to caretaker David Carter. The lease is a no- charge lease to Mrs. Tucker in exchange for caretaker services for the property until which time the City is able to have a presence there. The property was originally purchased for, and has thus far been master planned as, an equestrian -based facility. The yearly lease (and sub - lease) is set to expire on February 28, 2004. In light of the recent grassroots campaigns to examine this property closely for a number of uses, including as the basis of operations for a Southlake Nature Center, staff feels it is appropriate to consider the feasibility of terminating the lease and transitioning to the public use of the property. The Park Board made a recommendation at their regular meeting on January 12, 2004, to extend the current lease 90 days past the expiration date of February 28, 2004, to May 31, 2004. The Board expressed a keen interest in transitioning to a public use of the property. Staff recommended, and the Board agreed, that the time until the extension period expires be used to formulate a transition plan based on adult volunteer staffing by community groups. The plan will be presented to the Board and Council prior to occupation of the premises by the public. Financial Considerations: The following scenarios in matrix form are meant to offer a simplistic range of possibilities of financial considerations in a transition from the current lease of the Tucker property to public use. The matrix is based on three main factors that need to be considered and balanced with any use of the Tucker property. These are not absolutes; they are only meant as discussion parameters: Use Scenario Operational Potential for Availability to Complexity Income the Public Current Lease and Sub -Lease None None None Use exclusively as a Nature Center Low Low Moderate Use as a Nature Center and an Equestrian Moderate High Moderately Facility High Use as a Nature Center and Youth Social Facility Moderately Moderate High High Use as any type of Meeting /Gathering Facility Moderately Moderate High High Financial Impact: Use of the ranch house by Nature Center volunteers or other group(s) would carry inherent costs for utilities, supplies and upkeep, though not fully explored at this point. Citizen Input/ Board Review: o At the Park Board meeting on October 13, 2003, general discussion was held on the use of the Tucker property as a Nature Center and /or leased to an equestrian interest that would provide that service to the public. No official action was taken and the general discussion was mainly open to a variety of use scenarios. o The Park Board voted 7 -1 at their regular meeting on January 12, 2004, to recommend to City Council to extend the current lease 90 days past the current expiration date of February 28, 2004, to May 31, 2004, and for staff to develop a transition plan for occupation of the property. Park Board member Elaine Cox dissented on the vote having proposed a shorter termination schedule. Legal Review: Any modification to the current lease terms would require City Attorney review. Alternatives: (1) Terminate existing lease per the Park Board's recommendation effective May 31, 2004. (2) Terminate existing lease effective February 28, 2004. (3) Exercise 12 -month extension option in the lease contract Supporting Documents: Copy of the existing lease between the City of Southlake and Marilyn Tucker. Staff Recommendation: Terminate existing lease per the Park Board's recommendation effective May 31, 2004, and allowing staff to develop a transition plan for initial use of the property. LEASE BETWEEN CITY OF SOUTHLAKE e►I MARILYN TUCKER Terms and Definitions Date: Landlord: Landlord's Address: Tenant: Tenant's Address: Premises: Rent: Term (months): Commencement Date: February 3, 2003 City of Southlake 1400 Main Street, Suite 460 Southlake, Texas 76092 Marilyn Tucker (May be leased to sub - tenant upon written consent of the Landlord) 31 -A Bob Jones Road Roanoke, Texas 76262 Approximately 61 acres located in Southlake, Tarrant County, Texas, as more particularly described on the attached Exhibit "A" $1 perterm. Twelve (12) months. March 1, 2002 Termination Date: February 28, 2004, with the option to renew for one (1) additional 12 -month consecutive term with written consent of the Landlord's City Manager. Use: For residential purposes and to continue Tenant's existing business of boarding and grazing no more than ten (10) horses and no more than ten (10) head of cattle. Amount of Liability Insurance: Death /Bodily Injury: $1,000,000 minimum Lease Clauses and Covenants Tenant Agrees to — Act as caretaker for the premises, maintaining all vegetation and physical structures in a condition consistent with the conditions of the premises at time of purchase by the Landlord and otherwise suitable to the Landlord, and inform the Landlord immediately of any suspicious conduct or activities occurring on the premises or in the vicinity. 2. Accept the premises in their present condition "as is," the premises being currently suitable for Tenant's intended use. 3. Obey all laws, ordinances, orders, and rules and regulations applicable to the use, condition, and occupancy of the premises. 4. Allow Landlord to enter the premises, with reasonable notice. 5. Repair any damage to the premises caused by Tenant and maintain in good, safe condition. 6. Maintain public liability insurance for the premises and the conduct of Tenant's business, naming Landlord as additional insured, in the amounts stated in the basic lease terms above. Such insurance policies shall contain a provision that they shall not be canceled without giving Landlord thirty (30) days' notice. 7. Maintain insurance on Tenant's personal property and require sub - tenant, if any, to maintain insurance on sub - tenant's personal property. 8. Deliver certificates of insurance to Landlord before the Commencement Date and thereafter when requested. 9. INDEMNIFY, DEFEND, AND HOLD LANDLORD HARMLESS FROM ANY LIABILITY LOSS, ATTORNEY'S FEES, EXPENSES, OR CLAIMS ARISING OUT OF USE OF THE PREMISES, WHETHER OR NOT THE CLAIM ARISES OUT OF LANDLORD'S NEGLIGENT ACT OR OMISSION. 10. Vacate the premises on termination of this lease. 11. Use the premises solely for Tenant's residence and for the boarding and grazing of no more than ten (10) horses and no more than ten (10) head of cattle. 12. Comply with the provisions of Texas Civil Practice and Remedies Code, Sec. 87.005, and post and maintain a sign that contains the prescribed warning in a clearly visible location on or near the stable and include the warning in every written contract that Tenant enters into for boarding services or equine activities. 13. Provide Landlord with a copy of each agreement Tenant has entered into for boarding services. 14. Recognize that Landlord may construct improvements upon the premises and Tenant waives any claim for damages and releases Landlord, its officers, employees and contractors, from any liability arising from the construction of improvements. Tenant agrees not to — 1. Use the premises for any purpose other than that stated in the basic lease terms and definitions. 2. Use the premises for any purpose other than as provided herein. 3. Create a nuisance, (ii) permit any waste, or (iii) use the premises in any way that is extra hazardous, would increase insurance premiums, or would void insurance on the premises. 4. Alter the premises. 5. Assign this lease or sublease any portion of the premises without written consent of Landlord. Landlord and Tenant agree to the following: 1. Termination. Either party may terminate this lease for any reason upon thirty (30) days written notice to the other party. 2. Alterations. Any physical additions or improvements to the premises made by Tenant will become the property of Landlord. 3. Default. Tenant shall be in default by failing to comply within ten (10) days after written notice with any provision of this lease. 4. Landlord's Remedies. Landlord's remedies for Tenant's default are to (i) enter and take the premises on behalf of Tenant; (ii) terminate this lease by written notice and sue for damages. Landlord may enter and take possession of the premises by self -help, by picking or changing locks if necessary, and may lock out Tenant or any other person who may be occupying the premises without being liable for damages. 5. Default /Waiver /Mitigation. It is not a waiver of default if the non - defaulting party fails to declare immediately a default or delays in taking any action. Pursuit of any remedies set forth in this lease does not preclude pursuit of other remedies in this lease or provided by law. 6. Holdover. If Tenant does not vacate the premises following termination of this lease, Tenant shall be a tenant at will and shall vacate the premises on receipt of notice from Landlord. No holding over by Tenant, whether with or without the consent of Landlord, will extend the term. 7. Attorney's Fees. If either party retains an attorney to enforce this lease, the prevailing party is entitled to recover reasonable attorney's fees. 8. Notices. Any notice required by this lease shall be deemed to be delivered (whether or not actually received) when deposited with the United States Postal Service, postage prepaid, certified mail, return receipt requested, and addressed to Landlord or Tenant at their addresses. 9. Abandoned Property. Landlord may retain, destroy, or dispose of any property left on the premises at the end of the term; however, Tenant shall have the first right of refusal to purchase any of the small barns and out - buildings Landlord proposes to be demolished, during the term of this lease. Tenant: a Landlord: City of Southlake By: City Manager ATTEST: CITY SECRETARY N: \Parks & Recreation \CONTRACT \Tucker lease.doc