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HomeMy WebLinkAbout2017-12 VRD Lease for the Golf Course and Skate ParkRESOLUTION NO. 12 Series of 2017 A RESOLUTION APPROVING A LEASE AGREEMENT BETWEEN THE TOWN OF VAIL AND THE VAIL RECREATION DISTRICT REGARDING THE VAIL GOLF COURSE; AND SETTING FORTH DETAILS IN REGARD THERETO WHEREAS, the Town of Vail (the "Town"), in the County of Eagle and State of Colorado is a home rule municipal corporation duly organized and existing under the laws of the State of Colorado and the Town Charter (the "Charter"); WHEREAS, the members of the Town Council of the Town (the "Council") have been duly elected and qualified; WHEREAS, the Vail Recreation District (the "District") is organized for the primary purpose of providing recreational programs and services to its residents and visitors; WHEREAS, the Town owns various recreational facilities, including the Vail Municipal Golf Course; WHEREAS, it is the desire of both parties to cooperate in the provision of recreation programs and services to the inhabitants and guests of the Town at the Golf Course; WHEREAS, the District has been providing such services under various lease agreements since 1966 (collectively, the "Prior Lease"); WHEREAS, it is the desire of both parties for the District to continue to provide these services; WHEREAS, the Town and the District are authorized by C.R.S. § 29-1-203 to enter into agreements to govern the provision of such services to the inhabitants and visitors of the Town; and WHEREAS, the parties intend for this Lease to replace the Prior Lease. NOW THEREFORE, BE IT RESOLVED BY THE TOWN COUNCIL OF THE TOWN OF VAIL, COLORADO THAT: Section 1. The Council hereby approves the Agreement and authorizes the Town Manager to enter into the Agreement with the District, in substantially the same form as attached hereto as Exhibit A and in a form approved by the Town Attorney. Resolution No. 12, Series 2017 Section 2. This Resolution shall take effect immediately upon its passage. INTRODUCED, PASSED AND ADOPTED at a regular meeting of the Town Council of the Town of Vail held this 4th day of April, 2017. e Chapin, Town Mayor Resolution No. 12, Series 2017 GOLF COURSE LEASE AGREEMENT THIS GOLF COURSE LEASE AGREEMENT (the "Lease") is made and entered into as of the day of April, 2017 (the "Effective Date"), by and between the TOWN OF VAIL, COLORADO, a Colorado municipal corporation (the "Town") and the VAIL RECREATION DISTRICT, a quasi -municipal corporation and political subdivision of the State of Colorado (the "District") (each a "Party" and collectively the "Parties"). WHEREAS, the District is organized for the primary purpose of providing recreational programs and services to its residents and visitors; WHEREAS, the District imposes an ad valorem mill levy on taxable property within its boundaries for purposes of defraying in part the costs of fulfilling this mission; WHEREAS, the Town owns various recreational facilities, including without limitation the Vail Municipal Golf Course (the "Golf Course"); WHEREAS, it is the desire of both Parties to cooperate in the provision of recreation programs and services to the inhabitants and guests of the Town at the Golf Course; WHEREAS, the District has been providing such services under various lease agreements since 1966 (collectively, the "Prior Lease"); WHEREAS, it is the desire of both Parties for the District to continue to provide these services; WHEREAS, the Town and the District are authorized by C.R.S. § 29-1-203 to enter into agreements to govern the provision of such services to the inhabitants and visitors of the Town; and WHEREAS, the Parties intend for this Lease to replace the Prior Lease. NOW THEREFORE, in consideration of the mutual promises contained herein, the adequacy of which is hereby admitted, the Parties hereto agree as follows: 1. Lease of Premises. a. The Town hereby leases to the District and the District leases from the Town the real property more particularly depicted in Exhibit A, attached hereto and incorporated herein by this reference, together with all improvements, including without limitation all facilities and structures, located on, in, or under such real property (the "Premises"). The Premises includes without limitation the Golf Course, the Club House and the Nordic Center. 1 3/30/2017 C:IUSERSUMMIDESKTOPIGOLF COURSE CLUBHOUSE LEASE 03-30-17.DOCX b. This Lease shall supersede the Prior Lease and any other agreement to which the Town and the District are Parties with respect to the Premises, and such Prior Lease and agreements are hereby agreed to be of no further force or effect with respect to the Town, the District or the Premises. 2. Term and Surrender. a. This Lease shall commence on the Effective Date and shall terminate on January 1, 2028 (the "Termination Date"), unless terminated earlier as provided herein. Provided, however, that this Lease shall automatically renew for an additional 10 year term, until January 1, 2038, unless either Party provides the other Party with written notice of its decision to not renew this Lease no later than one year in advance of the Termination Date. b. Upon expiration or termination of this Lease, the District's right to use the Premises and all improvements thereon shall cease, and the District shall promptly quit and surrender to the Town the Premises in good order and safe condition, ordinary wear excepted. 3. Rent. a. The District shall pay Town an annual Rent in the amount of $165,000$ (the "Annual Rent"), which Annual Rent shall commence in 2017 and will then be increased annually each year thereafter based on increases in the U.S. Department of Labor's Consumer Price Index for the Denver -Boulder statistical area. The Town shall deposit the Annual Rent into the Recreation Enhancement Fund (the "REF"). Once funds are credited to the REF, they may only be expended on new facilities, major upgrades to existing facilities, or unforeseen costs to facilities on the Premises; provided, however, that such funds may be spent on any Town purposes where the Town Council has determined the need. The Parties intend that "new facilities" or a "major upgrade" under this Section are facilities or upgrades which enhance the quality or diversity of the public's experience of the Premises, as the case may be, beyond the experience that would prevail if the facilities were simply being maintained as required pursuant to this Lease, and are not mere repairs or replacements of existing capital facilities. On an annual basis, the District may request a detailed description of revenues to and expenditures from the REF. Upon the expiration or earlier termination of this Lease, the Town may expend any funds remaining in the REF on any lawful purpose and without any obligation to the District. b. The parties agree to evaluate the feasibility of any revenue or subsidy sharing in November of 2019. 4. Use of Premises. The Premises shall be used for golf, outdoor winter recreation programs and services and special events. The use of the Premises shall be further subject to the following: 2 3/30/2017 C:IUSERSIJMMIDESKTOPIGOLF COURSE CLUBHOUSE LEASE 03-30-17.DOCX a. The use of the Club House shall comply at all times with the "Vail Golf and Nordic Club House Management and Operations Plan" dated April 2013 (the "Operations Plan"), as well as the associated Conditional Use Permit. b. The Golf Course shall be operated in a high standard and in a manner comparable to or exceeding other resort -area municipal courses, including public golf courses operated in Aspen, Breckenridge, and Steamboat. c. The Club House includes a Banquet Room, which shall be operated in a high standard and in a manner comparable to or exceeding other first-class wedding and event venues in the Vail Valley. d. A committee composed of two District Board Members, the District's Director, two Town Councilmembers and the Town Manager (a "Recreation Subcommittee") may be created to act as a liaison between the Parties. The Recreation Subcommittee may promulgate advisory performance criteria with regard to programming, facilities usage and other matters related to the District's delivery of programs and services at the Premises. 5. Town Use. a. As a benefit for its employees, the District shall provide the Town with as many season golf, tennis, Nordic, and skating passes as the Town requests. Such passes shall be non -transferable. Use of the Premises pursuant to such passes shall be subject to all District policies, rules and regulations. b. In addition, the Town and only the Town (time in the facility may not be "gifted" to any organization) shall have a right to use the Club House for special events, at no cost to the Town other than fees sufficient to cover cleaning costs and compensation for any District staff required for the event. The Town and the District shall cooperate in scheduling the Town's events. The Town's use of the Club House shall be subject to the Operations Plan. The District, on an annual basis, shall submit to the Town the District's rate sheet of fees associated with the Town's use of the Club House pursuant to this Section. c. The Town and the District shall cooperate to use excess parking during winter months as skier parking. 6. Net Lease. This Lease shall be a net lease, and throughout the Term, except as otherwise expressly provided herein, all payments and other obligations or liabilities of any kind regarding the Premises shall be solely the responsibility of the District and not the responsibility of the Town. 7. Utilities. a. The District shall be solely responsible for all charges for water, sewer, gas, electricity, light, heat, power, telephone, video, Internet and any other utilities used on or supplied to Premises. 3 3/30/2017 C:IUSERSIJMMIDESKTOPIGOLF COURSE CLUBHOUSE LEASE 03-30-17.DOCX b. Irrigation and other water is supplied to the Premises pursuant to various agreements and interests in water rights. The Parties do not intend for this Lease to supersede or modify such agreements and rights. 8. Access by the Town. The Town and its agents shall have the right to enter in or on the Premises to examine them and to perform maintenance, repair, or replacement as required under this Lease. 9. Alterations. a. By the Town. The Town retains the right to conduct major changes to the Premises, including without limitation additions, reconfigurations, tear -downs or relocations at its discretion. In the event the Town determines to change a portion of the Premises, whether such change is minor or major (a "major" change including an expansion, tear -down, reconfiguration, relocation, etc.), the Parties shall meet and revise the Master List (defined below) of maintenance responsibilities consistent with the most recent allocation of responsibilities; provided, however, that the District shall not be obligated to retain or accept responsibility for maintaining, repairing, or replacing any changed item or new item if the District's estimated cost in doing so is increased by more than 10% as a result of such change unless such change is agreed to by the District. b. By the District. The District shall not make any changes to any portion of the Premises which would adversely change the function, access, value or quality of the Premises without the Town's prior written approval. c. Ownership of Improvements. All new facilities or other improvements affixed to the Premises shall, upon termination of this Lease, unless otherwise agreed at the time the Town's written approval is obtained or unless the Town requests removal thereof, become the property of the Town. All items of property purchased by the District and not affixed to the Premises shall remain the property of the District. 10. Hold Harmless. a. General. The Parties shall hold each other and each other's agents, servants and employees harmless from all liability, loss, damages, costs and expenses arising out of any act, error, omission or negligence in the operation, maintenance or use of the Premises; provided that this hold harmless provision shall not extend to damages resulting solely from the negligence or willful misconduct of either Party or its agents, servants or employees. b. Damage to Facilities. Neither Party shall be responsible for the repair or replacement of any facilities or improvements damaged by the negligent or willful acts or omissions (including without limitation negligent maintenance) of the other Party or its guests, agents, employees, licensees, or invitees. 11. General Maintenance. The District shall be responsible for all maintenance of the Premises, including without limitation the following: 4 3/30/2017 C:IUSERSIJMMIDESKTOPIGOLF COURSE CLUBHOUSE LEASE 03-30-17.DOCX a. Interior Maintenance. Ensuring all lights and doors are operating properly and repairing the same in a prompt manner, including replacing all light bulbs. ii. Replacing batteries in all smoke, fire and CO detectors, as needed, but at a minimum on a yearly basis. iii. Painting or staining the interior elements of the building as needed. iv. Not less than annually, ensuring that any scratches or dents in the paint or walls are properly repaired. v. Repairing and maintaining floors and shampooing any carpets as needed and at a minimum on an annual basis and repairing and cleaning any marks in a prompt manner. vi. Ensuring all bathroom facilities are operating properly and repairing the same in a prompt manner. vii. Providing janitorial service for regular and consistent cleaning of the facilities, including daily or hourly services as needed. viii. Ensuring that the restrooms are properly stocked with the necessary supplies. ix. Ensuring proper and regular trash disposal within the facility and trash removal from the facility. x. Repairing and replacing all furniture, fixtures and equipment. xi. Window washing, as needed. b. Exterior Maintenance. Maintaining plantings and irrigation systems and other improvements to a level of quality consistent with that of a golf course in a resort community. ii. Cleaning exterior surfaces as needed, but at a minimum on an annual basis. iii. On a semi-annual basis, at a minimum, ensuring that any scratches or dents in the walls are properly repaired. iv. Performing litter patrol on a daily basis. v. Using best management practices to ensure that all exterior maintenance activities have a minimal impact on the Gore Creek ecosystem. vi. Window washing, as needed. 5 3/30/2017 C:IUSERSIJMMIDESKTOPIGOLF COURSE CLUBHOUSE LEASE 03-30-17.DOCX c. Annual Maintenance Loq. Each Party shall keep an annual log setting forth actual expenditures made for maintenance, repairs, and replacements required hereunder. Each Party shall make such log available to the other party as requested. d. Annual Review. On an annual basis, the Parties shall meet to discuss the maintenance and operation of the Premises, compliance with this Lease, any potential capital expenditures and projects and any other related matters. 12. Capital Maintenance. Capital maintenance responsibilities shall be as set forth in Exhibit B, attached hereto and incorporated herein by this reference. 13. No Lien. The District agrees that it will not permit or suffer to be filed or claimed against the interest of the Town in the Premises any lien or claim of any kind during the terms of this Lease; if such lien or claim is filed, the District, within 30 days after receipt of notice of such lien or claim, shall cause the lien to be released. 14. Hazardous Materials. a. Though the Town has no actual knowledge of the presence of any hazardous materials or other adverse environmental conditions on the Premises, the Town makes no warranty regarding such materials or conditions. b. The District shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state, or local laws, ordinances or regulations relating to industrial hygiene or to the environmental conditions on, under, about, or affecting the Premises. The District shall not use, generate, manufacture, store, or dispose of on, under or about the Premises or transport to or from the Premises any flammable explosives, radioactive materials, hazardous wastes, asbestos, lead-based paints, toxic substances, or related materials, including without limitation any substances defined as or included in the definition of hazardous substances, hazardous wastes, hazardous materials, or toxic substances under any applicable federal or state laws or regulations. 15. Insurance. At all times during the term of this Lease, the District, at its own cost, shall carry and maintain adequate insurance policies to insure against all liability, claims, demands and other obligations associated with this Lease. At a minimum, the District shall procure and maintain the following insurance coverages listed below, with forms and insurers acceptable to the Town: a. Workers' Compensation coverage as required by law. b. Fire and Extended Loss coverage for all improvements on the Premises, in an amount equal to 100% of the replacement cost of such improvements, naming the Town as an additional insured. c. The following coverages in minimum amounts of $1,000,000 for each occurrence and $1,000,000 general aggregate: 6 3/30/2017 C.IUSERSIJMMIDESKTOPIGOLF COURSE CLUBHOUSE LEASE 03-30-17.DOCX General Liability coverage applicable to the Premises, including bodily injury, broad form property damage, personal injury, blanket contractual, products and completed operations, naming the Town as an additional insured. ii. Comprehensive Automobile Liability coverage for the owned, hired or non - owned vehicles used in the performance of this Lease, naming the Town as an additional insured. iii. Liquor liability coverage if the District has or obtains a liquor license to serve wine, beer, or intoxicating liquors on the Premises, naming the Town as an additional insured. 16. Breach. a. If the District fails to perform any of its obligations under this Lease, the Town shall provide the District with written notice of the breach. The District shall have 15 days after the date of the notice to cure the breach. If a longer period is reasonably required to cure the breach and the cure is promptly begun, such cure period shall be extended for as long as the cure is being diligently undertaken to completion, as determined by the Town. b. If the District fails to cure the breach within 15 days after the date of the notice and a cure is not diligently being undertaken, the Town may, in its sole discretion, cure the breach without additional notice to the District. If the Town chooses to cure the breach, the District shall be liable for the costs and fees that the Town expends to cure the breach, including any costs resulting from the work of Town employees. The District's liability for costs and fees associated with curing a breach shall survive the termination of this Lease. c. In addition to curing a breach by the District, the Town may, in its sole discretion, terminate this Lease as a result of the District's failure to cure the breach. If the Town chooses to terminate this Lease under this subsection, it shall give the District 30 days prior written notice. 17. Miscellaneous. a. Assignment. This Lease and the District's obligations under this Lease shall not be assignable without the prior written approval of the Town. b. Contingency; No Debt. Pursuant to Article X, § 20 of the Colorado Constitution, any financial obligation of the Town or the District under this Lease is specifically contingent upon annual appropriation of funds sufficient to perform such obligation. This Lease shall never constitute a debt or obligation of the Town or the District under any statutory or constitutional provision. c. Severability. If any provision of this Lease is determined to be void by a court of competent jurisdiction, such determination shall not affect any other provision hereof, and all of the other provisions shall remain in full force and effect. 7 3/30/2017 C:IUSERSIJMMIDESKTOPIGOLF COURSE CLUBHOUSE LEASE 03-30-17.DOCX d. Integration. This Lease represents the entire agreement between the parties hereto with respect to the subject matter hereof, and all prior or extrinsic agreements, understandings or negotiations shall be deemed merged herein. e. Waiver. No provision of this Lease may be waived to any extent unless and except to the extent the waiver is specifically set forth in a written instrument executed by the Party to be bound thereby. f. Modification. This Lease may only be modified by subsequent written agreement of the Parties. g. Governing Law and Venue. This Lease shall be governed by and construed in accordance with the laws of the State of Colorado, and venue for any legal action arising out of this Lease shall be in Eagle County, Colorado. h. No Third Party Beneficiaries. No third party is intended to or shall be a beneficiary of this Lease, nor shall any third party have any rights to enforce this Lease in any respect. No Joint Venture or Partnership. No form of joint venture or partnership exists between the Parties, and nothing contained in this Lease shall be construed as making the Parties joint venturers or partners. j. Governmental Immunity. Nothing herein shall be construed as a waiver of any protections or immunities the Town or the District and their officials, representatives, attorneys and employees may have under the Colorado Governmental Immunity Act, C.R.S. § 24-10-101, et seq., as amended. k. Notice. Any notice to be sent to the Parties pursuant to the terms of this Lease shall be considered made three days after it is mailed via first class U.S. Mail to the following addresses: Town of Vail: Town Manager Town of Vail 75 South Frontage Road Vail, CO 81657 Vail Recreation District: Director Vail, CO 81657 IN WITNESS WHEREOF, the Parties have executed this Lease as of the Effective Date. ATTEST: 8 TOWN OF VAIL Stan Zemler, Town Manager 3/30/2017 C:IUSERSIJMMIDESKTOPIGOLF COURSE CLUBHOUSE LEASE 03-30-17.DOCX Patty McKenny, Town Clerk ATTEST: 9 VAIL RECREATION DISTRICT Mike Ortiz, Director 3/30/2017 C:IUSERSUMMIDESKTOPIGOLF COURSE CLUBHOUSE LEASE 03-30-17.DOCX