Loading...
HomeMy WebLinkAboutUtilities 2010-08-24 Item 2C - Discussion - Tukwila 205 Levee Repair - Lily Pointe Easement Interest PaymentTO: City of Tukwila INFORMATIONAL MEMORANDUM Mayor Haggerton FROM: Public Works Director DATE: August 17, 2010 SUBJECT: Tukwila 205 Levee Repair Lily Pointe Project No. 08 -DRO2 Easement Interest Payment ISSUE Approve interest payment to Lily Pointe LLC for the Tukwila 205 Levee Repair project. Attachments: Letter from Lily Pointe on established value and interest payment Lily Pointe Possession and Use Agreement W: \PW Eng\PROJECTS\A- DR Projects \08 -DR02 (205 Levee Repair)\Design Phase \Site 3 \Lily Pointe Final Easement \Info Memo Easement Interest Payment doc Jim Haggerton, Mayor BACKGROUND The US Army Corps of Engineers completed repairs to the Tukwila 205 Levee in 2008. These repairs required additional easement widths to allow for laying the levee slopes back to provide a more stable river bank. The City of Tukwila is responsible (under an agreement with the US Army Corps of Engineers) to provide all easements necessary for the construction and maintenance of the levee. City staff worked with the two affected property owners to secure Possession and Use Agreements that allowed the repair project to move forward quickly and avoid losing federal repair funding The agreement with Lily Pointe, LLC, called for the City to reimburse the property owner for the value of the easement plus 12% interest per year from the date of possession until payment. The King County Flood Control District (District) has committed to reimbursing the City for the actual cost of the easement but did not commit to the interest payment. Since completion of the Possession and Use Agreement, it has taken over two years to finish the site survey, appraisal, easement funding approval through the District, and final easement negotiations through the Corps, District, Lily Pointe, and the City. ANALYSIS An appraisal has been completed and Lily Pointe has accepted the appraised value of $343,000. The District is working with a closing agent to complete the transaction and record the easement. Per the Possession and Use Agreement, the City will need to provide approximately $106,000.00 in interest at the time of closing. Staff has reviewed options for funding the interest payment and it is recommended that the 412 Surface Water be used and then reimbursed using the City's share of the District's Annual Opportunity Fund over then next several grant cycles. Funding is anticipated at $44,000 each year and may be used for any flood related project. These Opportunity funds are currently programmed in the Annual Small Drainage Program. RECOMMENDATION The Council is being asked to approve funding for the interest of this easement acquisition in the amount of $106,000 and consider this item at the September 13, 2010 Committee of the Whole meeting and subsequent September 20, 2010 Regular Meeting. July 2, 2010 City of Tukwila Tukwila City Hall 6200 Southcenter Blvd. Tukwila, WA 98188 Sincerely, Lily Pointe Investments, LLC 4128 West Ames Lake Drive NE Redmond, Washington 98053 RE: Tukwila -205 Site 3 Levee Repair Project Lily Pointe Investments, LLC Property (TPIN 362304- 9087 -04) To Whom It May Concern, We have received and reviewed the appraisal prepared by GVA Kidder Mathews dated February 24, 2009, which assesses the value of our property before and after the granting of those permanent easements across the property that are necessary for the above referenced project. We agree that the $343,000 is a fair valuation of the easements. However, $89,198.97 in interest must be paid in addition to the above valuation amount. As you know, Lily Pointe entered into a Revised Possession and Use Agreement dated October 14, 2008 to allow the City and County immediate use of the easement areas until the parties could resolve the issue of just compensation and final easements could be granted. Section 4 of the Revised Possession and Use Agreement states that upon final valuation of the easements, the City would pay Lily Pointe the amount determined plus 12% interest per annum from May 19, 2008 until final payment was made. We calculate such interest to be $89,198.97, assuming that payment is made on July 20. 2010. Please let us know if you disagree with the above calculation or if you have any questions regarding this letter. We look forward to finalizing the remaining details of the actual easement document. John Deininger Carol -Ann O'Mack Manager, Lily Pointe Investments, LLC Co- Manager PL 84 -99 Tukwila 205 Levee Rehabilitation PROJECT POSSESSION AND USE AGREEMENT REVISED 08o tI (aj Tax Accounts 362304-9087 -04 TRACT OR OTHER PROPERTY IDENTIFICATION This Agreement is entered into by and between The City of Tukwila, a municipal corporation of the State of Washington (the "City") and Lily Pointe Investments, LLC, a Washington Limited Liability Company (the "Owner"). This document supersedes the previously recorded Possession and Use Document recorded under King County records number 20080604000331. RECITALS A. The document attached as Attachment 1 to this Possession and Use Agreement contains pertain easements rights (the "Easements that are necessary for repairs and improvements to the Tukwila 205 Federally Certified Levee under the guidelines for the U.S. Army Corps of Engineers PL 84 -99 Levee Rehabilitation Effort along the Left Bank afire Green River (The "Project"). Delay in acquisition and construction of the Project is contrary to the public interest_ B. Owner is the owner of that certain real property (the "Property") commonly known as 6801 S. 180th Street, Tukwila, Washington, and more particularly described on Attachment 2. C. Owner and City acknowledge that this Agreement is being entered into under threat of condemnation and shall be subject to just compensation by the City (in an amount that will be determmined upon a mutually acceptable settlement or trial) in order to compensate Owner far the Easements. Nothing heroin shall be construed as a waiver ofthe Owner's right to object to any further use or occupancy of any other portion of the property that the City may require in the future. D. The Owner wishes additional time to resolve any questions it may have concerning the Easements, including the issue ofjust compensation. AGREEMENT 1. For and in consideration of payment by the City to the Owner for the Easements, in an amount to be negotiated by the parties or determined at trial, the Owner grants to City possession and use of those portions of the Property subject to the Easements (the "Easement Area for Project purposes. 2. The parties agree that the Easement Area is necessary for a public use of the City. tithe parties cannot agree as to the amount ofjust compensation due the Owner and the City institutes condemnation proceedings, the Owner will not object to the City's entry of an Order Adjudicating Public Use and Necessity, as provided in RCW 8.12.090. 3, The parties agree that if condemnation proceedings are instituted by the City, this Agreement shall be deemed to satisfy the requirements of a stipulated Order of Ia ei...diate Use and Possession. This Agreement shall continue in effect until said proceedings have terminated and the Easement Area is finally acquired by the City- 4. The parties agree that the "Date of Possession" and the "Date of Valuation" for the Easement Area shall be May 19, 2008. The City agrees that upon final valuation of Easement Area, whether by mutual agreement or by trial, the City shall pay to Owner the amount determined plus twelve percent (12 interest per annum as accrued from. the Date of Possession through the date of final paymeznt. The parties agree to use canxtnercially reasonable efforts to negotiate a mutually acceptable settlement on valuation of the Easement Area as soon as possdale after the Date of Possession; however, should the parties fail to reach a mutually acceptable settlement within six (6) months of the Date of Possession, the parties shall proceed to trial. Page 1 of 13 O a_ 20081103000918.002 5. Nothing in this Agreement shall be deemed to waive any right either party may have to a subsequent adjudication of just compensation pursuant to state law. Neither this Agreement nor the basis for the payment made pursuant to this Agreement shall be construed as evidence of or an admission of fbir market value or just compensation by either party to the Agreement. 6. If condemnation proceedings are instituted, any payment of costs and attorneys fees shall be governed by the provisions ofRCW 8.25.070 and 8.25.075. 7. If in the use of the Easement Area the City, the King County Flood Control Zone District (the "County") or the Army Corps of Engineers (the "Corps') or any of their employees or agents damage any portion of the Property (including, but not limited to, the Easement Area), the City shall be solely responsible for ensuring that the Property is repaired, replaced and restored. Additionally, other than in the event of Owner's gross negligence, the City shall indemnify, defend and hold Owner, its successors and assigns harmless from and against all claims, damages (to property, improvements or otherwise), injury to persons, expense, loss, liability, causes of action or suit of any kind, including attorneys' fees and court costs, arising from or related to the rights granted to the City herein or the poesession and use of the Easement Area by the County or the Carps. The obligations contained in this Section 7 shall survive the granting of the Easements, whether the Easements are granted by Attachment 1 or by condemnation action. 3. This Agreement, including its attachments, is the complete expression of the terms hereto and any other representations, whether oral or in writing not incorporated in this Agreement are excluded. Time is of the essence of the performance of the provisions of this Agreement. Waiver of any default shall not be deemed to be a waiver of any other or subsequent default. Dated: /O /I 7 OWNER: Lily O to Inve eats, Washingr ted Liability Company BY CITY: 'Name: e eff _OL.9sJAi Q flv ..14. Title: P1r The City of Tukwila, a municipal corporation of the State of Washington. BY GJlt Tit tier Jr Page 2 of 12 20081103000518.003