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HomeMy WebLinkAbout12.b. (Handout) FAQs re Proposed lease agreement with AgLantis for Kiewit Property for CoCo San Sustainable Farm1A.b & Frequently Asked Questions (1�aapo) Proposed Lease Agreement ("Agreement ") with AgLantis for the Coco San Sustainable Farm ( "Farm ") on the Kiewit Property What are the general terms of the Agreement? • Up to ten -year lease (termination date of April 16, 2024) subject to performance conditions • Rent would be $1 per year, with a modifier after three years upon review of financials • Recycled water costs would be included in the rent • Area is 14.8 acres as depicted in Exhibit "B" to the Agreement What are the permitted uses? Per Section 4.1, the property may be used "for the creation of a non - profit sustainable urban farm with teaching facilities as described in Recital D, and as further described in Exhibit "C," and as further conditioned and described in any land use permit obtained by the District and applicable to the Premises." Recital D states that "the property subject to this lease is required by the District to be used as a buffer zone. The Tenant desires to lease the Premises from the District for a term up to ten years for the creation of CoCo San Sustainable Farm to: 1. Support the District's mission to foster sustainable and renewable practices, including recycled water; 2. Teach sustainable living practices, recycled water science, Delta awareness, sustainable watershed practices, integrated pest management, pollution prevention, soils science and other science related to District's educational programs; 3. Promote the District's environmental messages, including collecting and diverting household hazardous waste for proper reuse or disposal, 4. Showcase green technologies, including fostering green building practices and green jobs; and 5. Demonstrate how to reduce the carbon and environmental footprint of food production and distribution." What utilities would the District be providing? In order to showcase recycled water, the District would provide recycled water as part of the Agreement. In order to address the potential that the Farm may have sufficient revenues to pay additional Rent, Section 2.2 allows the District to review the financial records annually after three years to determine if the rent can be adjusted. This includes the cost of recycled water as it is included in the rent. All other utilities, including electricity, potable water, sanitation, fuel and other property- related services, would be the responsibility of the tenant. Similar to other recycled water customers, the District would provide a connection and meter. The installation of the connection would be combined with supply lines for the eastern half of the property for which the District is soliciting proposals for alternative uses. The recycled water distribution and irrigation lines would be the responsibility of the Farm. Will farm market stands or community gardens be allowed? Market stands and community gardens would not allowed in the Agreement. If requested at a later date, community gardens may be allowed with advance written permission from the District. The Farm would be able to sell to individuals on a membership or subscription basis; however, if any traffic impacts or frontage improvements were required, it would be up to the Farm to pay for and construct those improvements or fees. How are the insurance and indemnity clauses structured? The Agreement requires General Liability insurance in the amount of $5 million per occurrence, which can increased up to $1 million per occurrence depending upon the increased exposure to the District as the Farm public activity increases. Standard indemnity clauses are included. Tenant would be unable to take possession of the property until proper insurance was provided to the District, even after execution of the Agreement. The duration of the Agreement would be unchanged regardless of when possession of property is received. What about access to District infrastructure and inspection of the Farm? The District would have the right to access the Premises for purposes of assuring compliance with this Agreement and to access and repair the onsite infrastructure with reasonable advance notice provided. In the event of emergency, no notice would be required per Section 6.3. Are there provisions to reclaim the land if needed in the future for District purposes? Per Section 2.1 of the Agreement "the District will have the right to terminate this lease and Agreement as to any or all portions of the Premises, if the District Board declares the same to be required for public use. If such a determination of the need for public use of the Premises is made, the lease (Agreement) shall be subject to cancellation and termination by the District at any time thereafter by giving Tenant notice in writing as soon as possible, but no later than two years prior to the date such termination shall become effective." Are there "developed objective and quantifiable success indicators" in the Agreement? Per Section 4.2 of the Agreement, Tenant shall enter into a Performance Agreement with benchmarks as per Exhibit "D ", including but not limited to, operating requirements, limitations on fertilizing chemicals, farming, teaching and outreach goals. The Performance Agreement would be submitted annually as part of the business plan, which includes an estimated annual operating budget and an annual capital improvement budget for the coming year, as well as, after the first year of operation, a report on the previous performance results. What is the current legal structure of CoCo San Sustainable Farm and how does that relate to AgLantis? With the withdrawal of Earth Island Institute, the CoCo San Sustainable Farm proponent formed a corporation named AgLantis, a currently existing legal entity. This entity is applying to be a tax exempt non - profit corporation with a 501c(3) status. District Counsel has confirmed that AgLantis is permitted to accept donations and act as a non - profit entity while the tax - exempt paperwork is being processed. Section 4.1 of the Agreement requires the Farm to obtain the non - profit status within six months after its execution or it shall be considered an Event of Default. AgLantis currently has four board members with a number of technical advisory committees: • Carolyn R. Phinney, Chair and Chief Executive Officer • Bethallyn Black, Vice President • Stephen Hoeft, Chief Financial Officer • John Mercurio, Secretary Is this a partnership with AgLantis? Per Section 14.4.8, "The relationship of the parties under this Agreement is solely that of landlord and tenant, and it is expressly understood and agreed that the District does not as a result of this Agreement in any way nor for any purpose become a partner of the Tenant or a joint venturer with the Tenant in the conduct of the Tenant's business or otherwise." What is the status of the recycled water use permit? An Engineering report to address the agricultural use is underway and will be submitted to California Department of Public Health when complete. The report is waiting for information from the project proponents, including irrigation plans. What are the hours of operations and general operational guidelines? The specific operational guidelines will be submitted as part of the Business Plan which will be approved by the District. However, during lease negotiations, the Farm proponents have generally agreed to operate during daylight hours evenings a possibility for educational center Sustainable farm practices with limited fertilizing chemicals to property What capital improvements are anticipated? How will the District be involved in capital improvements? AgLantis has submitted a concept plan for the 14.8 -acre property that includes a long -range goal of a sustainable teaching center in Safety Zone 4 area. These improvements are seen in Exhibit "C" and will be part of the annual report submittal. The District will review and approve all plans per Section 6. All alterations and additions shall be made at the Tenant's sole cost and expense. Anticipated improvements for the first three years include fencing, roads, irrigation lines, a 46'x150' donated greenhouse, cooler, barn and solar panels.