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#25-14 - Authorizing a Lease with Crowley Fuels, LLC for a 6,230 Square Foot Portion of USS 495 Tidelands (North Fuel Dock)
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SUBMITTED BY: Nicole Chase, Planner
FISCAL NOTES:
Expenditure Required: N/A
Unencumbered Balance: N/A
Funding Source: N/A
RECOMMENDATION:
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Approve resolution 25-14 authorizing a lease with Crowley Fuels, LLC for a 6,230 square foot portion of USS 495 Tidelands (North Fuel Dock)
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SUMMARY STATEMENT:
The City of Valdez entered into a lease for a 6,230 square foot portion of USS 495 Tidelands, with Westmark Hotels, Inc. in 2001 for twenty-one years, expiring July 31, 2022 with six additional, five-year options to renew. This lease was partially assigned to separate the fuel dock portion and assign it to Valdez Fuels, LLC in 2002. Valdez Fuels was acquired by Crowley Fuels, LLC, and the lease was assigned to Crowley in 2012.
The lease was amended via resolution #22-76 to extend the term of the lease, expiring July 31, 2024. The lease has been in holdover with all terms and conditions continuing on a monthly basis since the expiration while the recommended new lease terms were negotiated between staff and Crowley.
Crowley Fuels, LLC has applied to continue to lease this property for use of fuel dock. The new lease is proposed for an initial term of 10 years, with four five-year options to renew the lease. The rent for this lease is subject to fair rental value pursuant to Valdez Municipal Code 14.04.020 which is determined to be 10% of appraised value annually which amounts to $1,500.00 annually for use of this property according to the most recent appraisal for the location. In addition to the baseline annual rent, staff proposes that lessee pay a fuel surcharge of $00.04 cents per gallon of fuel sold. The lessee should provide lessor access to meters and other records necessary to determine the annual volume of fuel sold at this location. Staff proposes this negotiated rate since the fair rental value ...
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