HomeMy WebLinkAboutResolution - 2018-R0086 - Brandon Station Lease - 02/22/2018Resolution No. 2018-R0086
Item No. 6.24
February 22, 2018
RESOLUTION
WHEREAS, Lubbock Power & Light is the municipally owned electric utility of
the City of Lubbock ("LP&L");
WHEREAS, on or about April 28, 2005, the City of Lubbock and Texas Tech
University System ("TTUS"), entered that certain Power Purchase Agreement
("PPA"), providing for the sale and purchase of electricity to serve the TTUS facilities;
WHEREAS, certain issues have arisen regarding the purchase price of the
electricity to be sold and purchased under the PPA and other issues provided in the
PPA;
WHEREAS as a part of the process to provide certainty as to the purchase price
under the PPA, the State of Texas, acting by and through Texas Tech University
("TTU"), has agreed to lease 1.12 acres of land owned by it to the City (the "Brandon
Station Lease") related to the operation of electric generation and substation facilities,
commonly known as "Brandon Station";
WHEREAS, the City Council finds that entering into the Brandon Station Lease is
in the best interest of the rate payers of Lubbock Power & Light ("LP&L");
WHEREAS, the City and TTUS now desire to enter into the Brandon Station Lease;
NOW, THEREFORE:
BE IT RESOLVED BY THE CITY COUNCILOF THE CITY OF LUBBOCK:
THAT the Mayor of the City of Lubbock BE and is hereby authorized to execute
that certain Brandon Station Lease, by and between the State of Texas, acting by and
through Texas Tech University and the City of Lubbock, acting by and through its City
Council, said Brandon Station Lease being attached hereto and incorporated herein as
though set forth fully herein in detail, and any documents related thereto.
Passed by the Electric Utility Board this 22nd day of February, 2018.
Daniel M. Pope, Ma or
ATTEST:
---R 4.4-C ie
Reb c Garza, City Secre
APPROVED AS TO CONTENT:
r
David McCalla, Director of Electric Utilities
APPROVED AS TO FORM:
zlt�oc �,
Richard Casner, LP&L General Counsel
Resolution No. 2018-R0086
BRANDON STATION LEASE
STATE OF TEXAS §
COUNTY OF LUBBOCK §
This Lease, effective April 28, 2005, by and between the State of Texas, acting by and
through Texas Tech University, an institution of higher education, and its Board of Regents
(referred to herein as "TTU"), and the City of Lubbock, Texas, a Texas home rule municipal
corporation, acting by and through its Electric Utility Board and City Council (referred to
collectively herein as "LP&L"). TTU and LP&L are collectively referred to herein as the
"Parties."
WHEREAS, on April 28, 2005, the Parties previously entered into a power purchase
agreement ("PPA") that will expire on June 30, 2019, if either TTU or LP&L provides notice of
termination to the other, as set forth in Section 1.3 of the PPA;
WHEREAS, as part of the PPA, Texas Tech University System ("TTUS") granted LP&L
a lease covering the surface rights to that certain tract of TTU land described on Exhibit "A"
attached hereto (also referred to herein as the "Leased Premises"), on which LP&L has erected
certain property related to the generation and delivery of electrical power to, among others, the
campus of Texas Tech University and Texas Tech University Health Sciences Center; and
WHEREAS, the Parties wish to extend, amend, and restate the terms by which LP&L may
continue to lease and operate on the Leased Premises.
NOW, THEREFORE, TTU hereby agrees to lease, let and demise, and does hereby lease,
let, and demise to LP&L, the Leased Premises, subject to the following conditions:
A. Term. The initial term of this Lease shall be thirty (30) years from and after the date of
execution hereof by LP&L. Additionally, LP&L is granted the option to extend this Lease, on
identical terms and provisions as the initial term, for two (2) successive ten (10) year terms, by
providing notice of the exercise of such option to TTU at, for mail delivery, Texas Tech University
System, Box 42021, Lubbock, Texas 79409, Attn: Vice Chancellor and General Counsel, or for
hand delivery, at 1508 Knoxville Ave., Suite 309, Lubbock, Texas, 79409, Attn: Vice Chancellor
and General Counsel, no later than ninety (90) days prior to the end of the initial term, or option
term, as applicable. However, the terms, conditions, responsibilities, and liabilities of the Parties
which by their nature and context are intended to survive the expiration or earlier termination of
this Lease will continue on past the expiration of this Lease.
B. Consideration. LP&L will pay TTU rent of One Hundred and No/100 Dollars ($100.00)
per year during the term of this Lease, first payable on or before five (5) business days after the 5'h
day of March, 2018, and on each annual anniversary date thereafter. In the event LP&L shall assign
this Lease, in accordance with the terms stated herein, the rent payable hereunder, beginning on
the first day rent is due, shall be adiusted to a fair market rental rate. The fair market rental rate, if
not agreed upon by TTU and the assignee of LP&L, shall be determined by a certified or licensed
Brandon Station Lease Page 1 of 7
appraiser acceptable to TTU and assignee of LP&L, at the sole cost and expense of the assignee
of LP&L. Additionally, LP&L shall provide any and all steam produced from the Leased Premises
to TTU, if any, it being stipulated by the Parties that LP&L is under no obligation to produce
steam, at no cost to TTU.
C. Exceptions to the Leased Premises. This Lease only covers and includes the surface
estate to the Leased Premises and does not include any oil, gas, sulfur, caliche, or other minerals
("Minerals") or any rights to groundwater or groundwater sources ("Water") that may be contained
in and under the Leased Premises. This Lease specifically does not grant any right, and hereby
reserves all rights, regarding any mining or exploration activities related to Minerals and Water.
However, TTU covenants that any Mineral or Water exploration, production or transportation
activities related to the Leased Premises shall not occur on or over the surface of the Leased
Premises.
D. Access. This Lease also includes during the term hereof, irrevocable rights of access,
including ingress and egress, and rights of drainage, on, over and across lands owned, controlled
or occupied by TTU located in Lubbock County, Texas, to the extent necessary or incidental to
the enjoyment of the rights and estates granted to LP&L hereunder.
E. Further Assurances. The Parties agree and recognize that this Lease does not represent a
fee simple conveyance of the Leased Premises.
F. Governing Law. This Lease shall be governed by the laws of the State of Texas. In the
event any claims arise regarding this Lease, then Lubbock County, Texas shall serve as the
exclusive venue for such claims. NEITHER THE EXECUTION OF THIS LEASE BY TTU, NOR
ANY OTHER CONDUCT OF ANY OF TTU'S REPRESENTATIVES RELATING TO THIS
LEASE, WILL BE CONSIDERED A WAIVER OF TTU'S SOVEREIGN IMMUNITY TO
SUIT.
G. Responsibilities of LP&L. LP&L accepts the Leased Premises in its condition, AS IS,
and shall comply with the following conditions:
LP&L's use of the Leased Premises shall be limited to that necessary for or
incidental to the operation, construction, reconstruction, repair and maintenance,
and any other activity conducted in accordance with good utility practice, of an
electric generation or transmission facility, including without limitation, the
erection and use of generating equipment, transformers, electric transmission and
distribution infrastructure, natural gas and steam related infrastructure and
emissions equipment.
2. LP&L, at its sole cost, may improve and/or alter the Leased Premises without
consent of TTU, so long as such improvements and alterations are consistent with
the use granted above, except as to modifications to site beautification, for which
the consent of the TTU Assistant Vice President, Operations Division ("Assistant
Vice President") is required. LP&L shall submit its plans for site beautification
modifications to the Assistant Vice President, at, for mail delivery Texas Tech
Brandon Station Lease Page 2 of 7
University PO Box 43142, Lubbock, Texas 79409, or for hand delivery, Physical
Plant Building, 3122 Main Street, Room 106C Lubbock, Texas 79409, (806) 834-
4673, and the Assistant Vice President shall promptly review such plans, and either
approve or disapprove such plans, within thirty (30) calendar days of submittal by
LP&L. If the plans are disapproved, the Assistant Vice President shall provide to
LP&L the reasons for such disapproval and the matters in need of correction or
modification. In the event the Assistant Vice President fails to approve or
disapprove the plans within thirty (30) calendar days after submittal it shall be
deemed for all purposes that the Assistant Vice President has approved such plans.
The approval processes of the Assistant Vice President shall be exercised
reasonably and the site beautification requirements of TTU shall be no more
stringent than those normally utilized in the City of Lubbock for substations located
in single family residential zones. TTU stipulates that the site beautification
improvements existing as of the date of the execution hereof by LP&L, are
satisfactory.
LP&L shall also allow TTU representatives, including representatives from Texas
Tech University System Facilities Planning and Construction ("TTUS FP&C") to
view LP&L's construction plans for all other improvements to be erected on the
Leased Premises. TTU stipulates that such plans are highly security sensitive and,
except to the extent TTU is required to disclose such plans under the Texas Public
Information Act, shall maintain confidentiality of such plans.
3. LP&L shall maintain the Leased Premises and improvements, and erect and
maintain safety barriers in accordance the standards set forth in the National
Electrical Code and IEEE standards that provide industry guidance.
4. Upon the expiration or termination of this Lease, LP&L may, at its election, and
shall, if TTU requests, remove any and all improvements to the Leased Premises,
including electric generation, transmission, and distribution related infrastructure
and equipment. In such event, LP&L shall remove foundations and underground
infrastructure installed by LP&L.
LP&L shall, as between LP&L and TTU, be solely responsible for environmental
damage caused by its operations on the Leased Premises. At the expiration of this
Lease, LP&L shall return the ground and soil, on the Leased Premises to a condition
as permitted by the Texas Commission on Environmental Quality, or successor
state regulatory body with jurisdiction over environmental matters, for industrial
uses.
6. LP&L may assign this Lease, in whole or in part, in the event of a conveyance of
all or substantially all of its electric generation and/or transmission assets. In other
cases, LP&L may not assign and convey this Lease without the prior written
approval of TTU, which shall not be unreasonably withheld. When TTU consent
to assign is required, if TTU has legitimate business, health, or safety concerns
regarding the assignee of the Lease, or the transaction resulting in the assignment,
Brandon Station Lease Page 3 of 7
then TTU may, in its reasonable discretion, withhold its consent to the assignment.
LP&L shall not sublease the Leased Premises.
7. IN THE EVENT LP&L SHALL ASSIGN THIS LEASE, IN WHOLE OR IN
PART, THE ASSIGNEE SHALL INDEMNIFY AND HOLD TTUS HARMLESS
FROM ALL CLAIMS AND LIABILITIES THAT MAY ARISE REGARDING
SUCH ASSIGNEE'S OPERATIONS AND TENANCY OF THE LEASED
PREMISES, INCLUDING SUCH CLAIMS THAT ALLEGE ANY DAMAGES
BECAUSE OF THE SOLE NEGLIGENCE OF TTU, INCLUDING FEES AND
EXPENSES IMPOSED OR INCURRED AS A RESULT OF REGULATORY
COMPLIANCE REQUIREMENTS AND THE IMPOSITION OF AD
VALOREM TAXES ON THE LEASED PREMISES. THIS
INDEMNIFICATION INCLUDES ALL OF TTUS'S COMPONENT
INSTITUTIONS, INCLUDING TEXAS TECH UNIVERSITY AND TEXAS
TECH UNIVERSITY HEALTH SCIENCES CENTER, AS WELL ALL OF
TTUS'S AND THE COMPONENT INSTITUTIONS' EMPLOYEES, AGENTS,
AND THE MEMBERS OF THE BOARD OF REGENTS.
H. Responsibilities of TTU. TTU shall comply with the following conditions:
1. It is understood that LP&L may acquire leasehold title insurance covering the
Leased Premises. TTU shall cooperate with LP&L and will provide estoppel
certificates/letters within thirty (30) calendar days of any request by LP&L. Any
days marked as holidays on the TTU calendar shall not count against the thirty (30)
day deadline to comply.
2. TTU shall execute a Memorandum of Lease in the form attached hereto as Exhibit
"B." LP&L shall be responsible for any recordation of the Memorandum of Lease,
including any costs associated with such recordation. Furthermore, at the
termination of the Lease, LP&L shall execute a Release of Lease, which shall also
be recorded at LP&L's sole cost and expense.
3. As an agency of the State of Texas, TTU represents and warrants the following:
(a) TTU owns the Leased Premises, subject to any covenants, conditions,
easements, and other matters of record in Lubbock County, Texas;
(b) Under Texas law, TTU's Board of Regents is:
(i) Vested with the sole and exclusive management and control of the
Leased Premises; and
(ii) Authorized to grant the rights under this Lease as the Lease is in
connection with the furnishing or providing of electricity or other
utility service on, over, or through the campuses of the Texas Tech
University System and the component institutions.
Brandon Station Lease Page 4 of 7
4. TTU relinquishes rights of access to the Leased Premises, without the prior consent
of LP&L, which shall not be unreasonably withheld. This relinquishment does not
apply in cases of emergency in which case TTU may, but is not affirmatively
required to, act to prevent loss of life or property.
TTU covenants and agrees that LP&L may peaceably and quietly have, hold,
occupy and enjoy the Leased Premises in accordance with the terms of this Lease
without hindrance from TTU or any person lawfully claiming through TTU.
Waiver and Breach. Waiver by a party of any breach of any duty of the other party under
this Lease will not be a waiver of a breach of any other duty of that party, or of any subsequent
breach of the same duty. Furthermore, any breach of this Lease, by either Party, shall not
automatically constitute a breach of the PPA as well, unless the action is indeed also contrary to
terms and conditions of the PPA.
Notice. Any notices required or permitted herein may be provided by either (i) certified
mail, return receipt requested, upon which notice shall be deemed delivered and received as of the
date of posting; or (ii) by hand delivery, upon which notice shall be deemed delivered and received
as of the date of hand delivery.
Liens. LP&L shall not create, or permit to be created, any lien, encumbrances, or charge
upon the Leased Premises.
Final Agreement. The Parties agree that this Lease represents the final and complete
agreement between the Parties related to the lease of the Leased Premises and that any previous
writing, solely excepting the lease terms provided in Section 11 of the PPA, and only for the period
of time Section 11 of the PPA was valid and enforceable, is of no consequence. Any such writing
shall not constitute a part of this Lease. This Lease may only be amended by a subsequent writing
duly authorized and signed by both Parties. In the event of a conflict or inconsistency between this
Lease and the PPA from and after the date of execution hereof by LP&L, the terms and the
provisions of this Lease shall prevail and control for all purposes.
Counterparts. This Lease may be executed in one or more counterparts, each of which for
all purposes will be deemed to be an original but all of which together will constitute the same
Lease.
This Lease is executed on the 51h day of March, 2018, but is effective for all purposes as of
April 28, 2005.
Name: A121prace—
Title: Ae&4&e'&
Brandon Station Lease Page 5 of 7
ELECTRIC UTILITY BOARD
f-.
By:
Greg Ta r, Ch ' man of the Electric Utility Board
ATTEST:
J es Conwright, ecretary
APPROVED AS TO CONTENT:
Lo"
David McCalla, Director of Electric Utilities
APPROVED AS TO FORM:
Richard K. Casner, General Counsel
Brandon Station Lease Page 6 of 7
CITY OF LUBBOCK
By:
Dan Pope, Mayor df the City of Lubbock
ATTEST:
Rebec a Garza, City Secretary
APPROVED AS TO CONTENT:
4��W_ i -
David McCalla, Director of Electric Utilities
APPROVED AS TO FORM:
Richard K. Casner, General Counsel
Date of Execution by LP&L: February 22 , 2018
Brandon Station Lease Page 7 of 7
Exhibit "A"
To
Brandon Station Lease
Lease Premises
FIELD NOTES
Being a legal description of a 1.12 acre tract of land situated on the campus of Texas Tech
University and being out of Section 1, Block E-2, Lubbock County, Texas and being more
particularly described by metes and bounds as follows:
BEGINNING at the Southwest corner of a brick wall for the Southwest corner of this tract,
whence the Southwest corner of Section 1, Block E-2, bears North 88110'10" West, 394.80
feet and South 1049'50" West, 2481.58 feet;
THENCE North 34019'20" West, along the face of an existing brick wall, 169.30 feet to the
Northwest corner of said brick wall and for the Northwest corner of this tract;
THENCE North 55°40'40" East, along the face of an existing brick wall, 288.80 feet to the
Northeast corner of said brick wall and for the Northeast corner of this tract;
THENCE South 34019'20" East, along the face of an existing brick wall,169.30 feet to the
Southeast corner of said brick wall and for the Southeast corner of this tract;
THENCE South 55040'40" West, along the face of an existing brick wall, 288.80 feet to the
point of beginning.
'+CONTAINING 1.12 ACRES.
Exhibit "B"
to
Brandon Station lease
Memorandum of lease
Return -to: Lubbock Power & Light; 1301 Broadway;Lubbock, Texas;Attn:Richard Casner
.GF#2017-,1449F
Recorded Electronically
ID %
STATE OF TEXAS § County
§ pale Time a
CSC eRecording 855_200_ '50
COUNTY OF LUBBOCK §
MEMORANDUM OF LEASE
THIS MEMORANDUM OF LEASE (the "Memorandum") is made and entered into to be effective
as of March 5, 2018 (the 'Effective Date"), by and between the State of Texas through Texas Tech
University, an institution of higher education, and its Board of Regents ("TTU"), and the City of
Lubbock, Texas, a Texas home rule municipal corporation, acting by and through its Electric
Utility Board and City Council (referred to herein collectively as "LP&L"). This Memorandum
shall evidence that there is in existence a Lease Agreement (the "Lease") as herein described, and
is executed by the parties hereto for recording purposes only as to the Lease hereinafter described.
The Memorandum is not intended and shall not modify, amend, supersede or otherwise affect the
terms and provisions of the Lease.
1. Name of Document: Brandon Station Lease
2. Effective Date of Lease: March 5, 2018
3. Term of Lease: Initial term of thirty (30) years, with option to extend for two (2)
additional ten (10) year terms
4. Address of Grantor: c/o Texas Tech University System
Attn: Vice Chancellor and General Counsel
Box 42021
Lubbock, Texas 79409
5. Address of Grantee: Lubbock Power &Light
Attn: Director of Electric Utilities
1301 Broadway, Lubbock, Texas 79401
6. Premises: See attached Exhibit "A"
The purpose of this Memorandum is to give record notice of the Lease and of the rights created
thereby, all of which are hereby confirmed. A copy of the Lease is on file with the Grantor and
Grantee at their respective addresses set forth above. In the event of any conflict between the
terms hereof and the terms under the Lease, the Lease shall control.
IN WITNESS WHEREOF, the parties have executed this Memorandum of Lease Agreement as
of the dates of the respective acknowledgments below to be effective as of the Effective Date.
Memorandum of Lease Page 1 of 4
GRANTOR:
THE T OF TEX y and through TEXAS TECH UNIVERSITY
Name: /&wrewez /5 L llwxzc,
Title: P"% ;/ 4aye
THE STATE OF TEXAS §
COUNTY OF LUBBOCK §
This instrument was ackno edged before me on �21O'Y LA -a , 2018, by
Cz Lyf'e-yice 1aJ&W— V.
, of the Texas Tech LAiiversity, an
institution of higher education of the State of Texas, on behalf of said University.
8fds
CLAROJEDA ISSA E. o ary Public, State of s
tVohiy RiMic, ofTa�on
C nvnhwWn Exp1m: My commission expires: `20
e 06-24-2019
Notary without Bond
Memorandum of Lease Page 2 of 4
GRANTEE:
ELECTRIC UTILITY BOARD
Greg Taylor,
Chairman of the Electric Utility Board
ATTEST:
04
J m s Conwright, ecretary
APPROVED AS TO CONTENT:
David McCalla, Director of Electric Utilities
APPROVED AS 0 77:,
�,
Richard Casner, General Counsel
THE STATE OF TEXAS
COUNTY OF LUBBOCK
This instrument was acknowledged before me on, , 2018, by
Greg Taylor, Chairman of the Electric Utility Board of the City of Lubbock, Texas home rule
municipal corporation, on behalf of said Electric :N&otaryPublic,-State
�'Texas
My commission expires:
KELLIE DAVIN HENRIE
2' NOWY 1r)-5836241
My C0mm.55 0^ Expires
�e;.•i,a o i 2022
Memorandum of Lease Page 3 of 4
GRANTEE:
CITY OF LN TEXAS
Dan Pope, Mayor of the City of Lubbock
ATTEST: X
Q4-a"-U�
Beck e
arza, Secretary ' (,.3
AP OVED TO CONTENT:
S
David McCalla, irector o Electric Utilities
APPROVED AS TO F
Richard Casner,
General Counsel of Lubbock Power & Light
THE STATE OF TEXAS
COUNTY OF LUBBOCK
This instrument was acknowledged before me on Q0 2018, by
Dan Pope, Mayor of the City of Lubbock, Texas home rule municipal corporation, on behalf of
said home rule municipal corporation.
Notary Public, State of Texas
My commission expires:
is
KELLIE DAWN HENRIENotary ID #5836241My Commission ExpiresFebruary 5, 2022
Memorandum of Lease Page 4 of 4
Exhibit "A"
to
Memorandum of lease
Land Description
FIELD NOTES
Being a legal description of a 1.12 acre tract of land situated on the campus of Texas Tech
University and being out of Section 1, Block E-2, Lubbock County, Texas and being more
particularly described by metes and bounds as follows:
BEGINNING at the Southwest corner of a bride wall for the Southwest corner of this tract,
whence the Southwest corner of Section 1, Block E-2, bears North 88`10'10" West, 394.80
feet and South 1049'50" West, 2481.58 feet;
THENCE North 34019'20" West, along the face of an existing brick wall, 169.30 feet to the
Northwest corner of said brick wall and for the Northwest corner of this tract;
THENCE North 55040'40" East, along the face of an existing brick wall, 288.80 feet to the
Northeast corner of said brick wall and for the Northeast corner of this tract;
THENCE South 34019'20" East, along the face of an existing brick wall, 169.30 feet to the
Southeast corner of said brick wall and for the Southeast corner of this tract;
THENCE South 55040'40" West, along the face of an existing brick wall, 288.80 feet to the
point of beginning.
+CONTAINING 1.12 ACRES.
FILED AND RECORDED
OFFICIAL PUBLIC RECORDS
Kelly Pinion, County Clerk
Lubbock County, TEXAS
03/22/2018 04:23 PM
Recording Fee: $46.00
2018010222