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HomeMy WebLinkAboutResolution - 1218 - Lease Agreement - A. Baker & K. Blair - Water Rights, Bailey County - 09/23/1982_4e DGV:js RESOLUTION RESOLUTION 1218 - 9/23/82 BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT the Mayor of the City of Lubbock BE and is hereby authorized and di- rected to execute for and on behalf of the City of Lubbock a Water Rights Lease Agreement by and between Archie Baker and Keith Blair and the City of Lubbock attached herewith which shall be spread upon the minutes of the Council and as spread upon the minutes of this Council shall constitute and be a part of this Resolution as if fully copied herein in detail. Passed by the City Council this 23rd day of September 1982. r i BILL McALISTER, MAYOR ATTEST: Evelyn Ga ga, City ry-Treasurer 61-1 APPROVED AS TO CONTENT: Wahl, DirlEctor of APPROVED AS TO FORM: ter Utilities G. Vandiver, Asst. City At RESOLUTION 1218 - 9%23/82 WATER RIGHTS LEASE AGREEMENT STATE OF TEXAS §' a >.+ COUNTY OF LUBBOCK This Agreement entered into by and between Archie Baker and Keith Blair, hereinafter called Owners, and the City of Lubbock, a home rule municipal corporation of Lubbock County, Texas, here- inafter called City; _ WITNESSETH WHEREAS, Archie Baker and Keith Blair are owners of certain real property located in Bailey County, Texas, which property is more particularly described in Exhibit A attached hereto and made a part hereof for all purposes; and WHEREAS, the said Owners are desirous of leasing the rights to the underground water located under the land described in Ex- hibit A, except for such rights to said underground water as may be herein retained by said Owners; and WHEREAS, the said City is desirous of leasing the rights to the underground water located under the land described in Exhibit A, except for such rights to said underground water as may be herein retained by said Owners; and WHEREAS, the said City finds it to be in the best interest of the citizens of the City of Lubbock to acquire the rights hereinafter granted to City; and . WHEREAS, the said Owners find it to be in their best in- terest to grant the rights hereinafter set out to City; NOW THEREFORE THE PARTIES HERETO AGREE AS FOLLOWS: 1. DESCRIPTION: Owners do by these presents lease and grant to City the rights to all underground water located under the following described real property situated in Bailey County, Texas: All that property.described.in Exhibit A attached -hereto -and made a part hereof for all purposes, except that Owners may . take water from the Owners` existing or additional domestic. - wells for domestic uses and livestock watering purposes, but not including commercial feedlot purposes. A map showing the location of ten (10) existing wells is attached hereto as Exhibit B and made apart of this Agreement for all purposes. The City shall have the exclusive right to use the existing ten (10) wells and to modify the existing wells as required -to comply 1 of 11 with the Texas Department of Health regulations and the exclusive right to drill additional wells at the City's option. This lease and grant is made by the Owners for the consideration of rents and covenants hereinafter set out. 2. PURPOSE: The purpose of this Agreement is to provide City with a source of potable underground water during the term of this Agreement and to provide Owner with a market for such potable underground water during7 the term of this Agreement. 3. TERM: This Agreement shall take effect upon the date of execution hereof by all parties and shall terminate December 31, 1993, subject to the City having first opportunity to con- tinue said Agreement by amendment executed at such time. If City and Owners fail or refuse to reach an agreement by the time of termination of this Agreement, then Owners may negotiate or sell such rights to others. 4. IMPROVEMENTS: As part of the consideration flowing to Owners and as an inducement to Owners to execute this document, City agrees to undertake the following: (a) To construct a pipeline gathering system for pur- poses of transporting said underground water to the City's existing reservoir. The depth to the top of such pipelines shall be no less than 42 inches below the land surface. (b) To modify existing well construction to meet the regulations of the Texas Department of Health. (c) To install City's pumps on all wells. All equip- ment, pumps, pipeline and accessories are the property of City and the City reserves the right to remove all pumps and equipment at the expiration of the Agreement. All pipelines will remain in place. (d) To maintain the existing wells and to leave no less than ten (10) operable wells at the expiration of the Agreement. However, City does not gdarantee the availabi- lity of water from such wells. 5. DUTIES OF OWNERS: Owners agree to undertake the -- following duties and obligations as part of the consideration flowing to City under this -Agreement: 2 of 11 (a) To reseed all pipeline rights-of-way for the ori- ginal ten (10) wells with native grasses to reduce wind ero- sion. (b) To transfer to City all of Owners rights under existing contracts for use of electric power from existing electric lines. However, the Owners reserve the right to retain any refunds pursuant to such contract which accrues prior to January 1, 1984. (c) To plant only low water use crops from the time of execution of this Agreement until City takes possession of the existing wells, with the exception of Well No. 4 & 11, which may be used to produce a crop of vegetables during such time period. (d) To provide City with access on and after June 1, 1983, for the purpose of installing pipelines and on and after January 1, 1984, for the purpose of installing pumps and equipment. Thereafter access shall be allowed for all required purposes pertinent to the operation and maintenance of said wells and pipelines. 6. DUTIES OF CITY: The City hereby agrees to undertake ttie following duties and obligations as part of the considera- tion flowing to Owners pursuant to this Agreement: (a) To take or pay for a minimum dollar amount of water during the ten year term of this Agreement following the date first delivery of water as set out in Exhibit C, which is attached hereto and made a part hereof for all purposes. (b) To pay Owners fifteen cents ($.15) per one thou- sand gallons (1,000) of water received by City. ',his price will be adjusted annually after December 31 to reflect changes in the Producer Price Index, Industrial Commodities, from a base date of December, 1980. Computation shall be as is set out in Exhibit D, which is attached hereto and made a part hereof for all purposes. Payment will be made in January each year for the minimum amount contracted for and adjustments will be made the following January to re - 3 of 11 flect the actual amount taken and payment for said addi tional amount shall be made to Owners at that time based upon the previous year's price as set out in Exhibit D. (c) To pay Owners Three Hundred Fifty Thousand Dollars ($350,000.00) in five (5) equal payments of Seventy Thousand Dollars ($70,000.00) beginning with a first payment due on closing and the next payment in January, 1963. Thereafter, payments shall be made each January until the total amount is paid. Such payment shall be in addition to payments for water set out in paragraph 6(b) above and shall be considera- tion for execution of this Agreement by Owners. (d) To remove Owners pumps on the ten (10) existing wells and stack them prior to installation of City's pumps. (e) To meter the water produced by a meter furnished, installed, operated and maintained by City, which meter shall be of standard type for measuring properly the quan- tity of water delivered under this Lease. The Owners shall have access at all times to such metering equipment, but the reading, calibration, and adjustment of the meters shall be done only by employees or agents of the City. Owners will be notified when City plans to test or calibrate its meters so that they may be represented if they so desire. The City shall keep a true record of all meter readings as tran- scribed from the reports of the City's employees or agents with respect thereto. The City hereby agrees to calibrate its metering equipment as often as it considers necessary and at such time as Owners may show reasonable evidence of error but not less than once each year. In the event the meter is out of service or out of repair so that the amount of water produced hereunder cannot be ascertained or com- puted from the reading thereof, the water produced and de- livered during the period such meter is out of service or out of repair, shall be agreed upon by the parties hereto, by correcting the error if the percentage of the error is ascertainable by calibration tests or mathematical calcu- lations, or by estimating the quantity of production by the 4 of 11 deliveries made during preceding periods under similar con- ditions when the meter was registering accurately. (f) Initial pipeline construction is to be completed by August 15, 1983. (g) The City shall hold the Owners harmless from any and all claims for damages arising from the City's use of the property whether such claims may be brought by the City's agents or employees or by any member of the public. 7. JOINT AGREEMENTS: All parties to this Agreement fur- ther agree as part of the consideration flowing to each to do the following: (a) City, by and through its employees, agents and re- presentatives, has personally inspected the well field site and have conducted such tests as are necessary to satisfy City as to the availability, quality and quantity of water available, it being understood and agreed that Owners do not guarantee water availability, potability, quality or quan- tity and City is not relying upon any representations of warranties of Owners with regard thereto. The expense of any treatments or test necessary .to obtain or maintain pot- ability shall be borne by City. (b) City does not guarantee that at the expiration of this Agreement that there will be any underground water re- maining on said property and there shall be no limitation upon the City with regard to the amount of water that may be pumped from any single well or any combination of wells during the term of this Agreement. (c) City shall be responsible for construction and maintenance of all power lines, roads and pipelines used to serve City facilities. City will restore to native grass all of the Owners' property damaged by construction or maintenance of City facilities except pipelines for the original ten (10) wells, which shall be reseeded by the Owners. 5 of 11 8. ENVIRONMENTAL.AND HEALTH COMPLIANCE: Owners hereby .agree to abide by Texas Department of Health regulations regard- ing land uses adjacent to municipal water supply wells. 9. OTHER PARTIES OF INTEREST: The following corpora- tions, partnerships, and/or persons have an interest in all or a portion of the land subject to this Agreement: (a) Travelers Insurance Company (b) Clovis National Bank (c) First National Bankette Agri -Corp If for any reason other than lack of water available upon the land, Owners are unable to meet the requirements of this Agree- ment, then the persons hereinabove named who are signatory to this Agreement hereby agree to be bound by the terms of this Agreement and to honor this Agreement in accord with said terms and conditions. 10. AGREEMENT RUNNING WITH THE LAND: This Agreement be- tween all parties signatory hereto shall be a condition and cove- nant running with the land described in Exhibit A and shall fur - then constitute an equitable servitude thereon and shall bind Owners and Owners' heirs and successors in title to such land. Any further conveyance of the land described in Exhibit A hereto shall contain this covenant and equitable servitude. It is fur- ther agreed by all parties hereto that this condition, covenant and equitable servitude shall terminate upon the expiration of this Agreement according to its terms. 11. RIGHT TO ENTER AND OPERATE WELL FIELD: It is under- stood that the City may at any time after June 1, 1983, have full and exclusive rights of ingress and egress in, over, and on said lands so that the City may at any time and location drill water wells and tests wells on said lands for the purpose of investi- gating, exploring, producing, and getting access to underground water; together with the rights to string, lay, construct, and maintain water pipelines, powerlines, communication lines, air vents, blowoffs, surge structures, observation wells, access roads on and over said lands necessary or incidental to any of 6 of 11 said operations, together with the right to erect housing for wells and associated equipment, meters and communications equip- ment, together with easements for the duration of this Agreement for all such purposes, together with the rights to use all that part of said lands necessary or incidental to the taking of ground water and the production, treating and transmission of water therefrom and delivery of said water to the existing re- servoir of the City of Lubbock, and the City shall, within a reasonable time after conducting any construction or mainte- nance operations on said land, remove therefrom any trash, de- oris and other material or objects which clutter or detract from the usefulness of said lands to the Owners thereof. The City shall be responsible for damage to crops or grass caused by construction or maintenance of City's facilities. Compensation for such damages that cannot be restored shall be determined by the current fair market value of the crop or grass involved as demonstrated by current value of said crop or grass on adjacent undamaged areas of the Owners' property. The annual loss to the Owners caused by said crop or grass damage shall determine the time period over which such damage payments shall be made. Where the City constructs and uses roads across and through boundaryline fences, the City shall furnish and install gates equipped with locks, it being understood that locking gates on the outside fences shall in no way effect the right of entry, ingress and egress of authorized officers, employees, and con- tractors of the City engaged in the business of the City per- taining to the full enjoyments of water rights herein conveyed. Where the City constructs and uses new roads across and through fences within the boundaries of said land, the City shall, at the option of the Owners, furnish and install gates with fas teasers but without locks. During construction City shall be allowed access to the leased property across other property owned by leased by City. 7 of 11 �■ II��1 I.I�.�� EXECUTED THIS 23rd DAY OF September 1982. CITYZAL-ISTER OWNERS: i MAYOR AP. HIE BAKER ATTEST: ' ILDRED BAKER i e yn ga, _ 3`' cretary- Treasurer KEITH BLAIR APPROVED AS TO CONTENT: . , DARLA BLAIR Sam V Director o Water ATTEST: I,— Utili es APPROVED AS TO FORM: Witness ,�i�- na G. Vandiver, Asst. City U i%!ttorney OTHER PARTIES OF INTEREST TRAVELERS INSURANCE COMPANY CLOVIS NATIONALBANK ATTEST: ATTEST: Secretary ecretary FIRST NATIONAL BANKETTE AGRI- ORP ATTEST: Secretary 8 of 11 ACKNOWLEDGEMENTS STATE OF TEXAS § COUNTY OF LUBBOCK § BEFORE ME, the undersigned authority, a Notary Public, in and for Lubbock County, Texas, on this day personally appeared Bill McAlister, known to me to be the person whose name is sub- scribed to the foregoing instrument and he acknowledged to me that he executed the same as the act and deed of the City of Lubbock for the purposes and consideration therein expressed and in the capacity therein stated. ��r myhft�andand seal of -office this J% ^" day of 1982. l Notary Public in and+ for Lubbock County, Texas My Commission Expires: STATE OF § COUNTY OF § BEFORE ME, the undersigned authority, a Notary Public, in and for County, , on this day personal y"appeare rcnie Baker, known to me to a the person whose name is subscribed to the foregoing instrument and he ac- knowledged to me that he executed the same as his own act and. deed for the purposes and consideration therein expressed and in the capacity therein stated. GIVEN under my hand and seal of office this day of , 1982. Notary Public in and for County, My Commission Expires: STATE OF § COUNTY OF § BEFORE ME, the undersigned authority, a Notary Public, in and for County, , on this day personally appeared red Baker-,-Rn-own to me to be the person whose name is subscribed to the foregoing instrument and she ac- knowledged to me that she executed the same as her own act and need for the purposes and consideration therein expressed and in the capacity therein stated. GIVEN under my hand and seal of office this day of . 1982. Notary Public in and for County, My Commission Expires: 9 of 11 STATE OF § COUNTY OF § BEFORE ME, the undersigned authority, a Notary Public, in and for County, on this day personally appeared-KeithBlair, known to me to a the person whose name is subscribed to the foregoing instrument and he ac- knowledged to me that he executed the same as his own act and deed for the purposes and consideration therein expressed and in the capacity therein stated. GIVEN under my hand and seal of office this day of 1982. Notary Public in and for County, My Commission Expires: STATE OF § COUNTY OF § BEFORE ME, the undersigned authority, a Notary Public, in and for County, , on this day personal y appearedDarla Blair, known to me to Fe the person whose name is subscribed to the foregoing instrument and she ac- knowledged to me that she executed the same as her own act and need for the purposes and consideration therein expressed and in the capacity therein stated. GIVEN under my hand and seal of.office this day of 1982. Notary Public in and for County, My Commission Expires: STATE OF § COUNTY OF § ? BEFORE ME, the undersigned authority, a Notary Public, in and for County, , on this day personally appeare , known by me to be the of Travelers Insurance Company, a corporation, and he ac now a ged to me that he executed the same as the act and deed of the Travelers Insurance Company for the purposes and consideration therein expressed and as the act of said Corporation. GIVEN under my hand and seal of office this day of , 1982 Notary Public in and for County, My Commission Expires: 10 of 11 STATE OF § COUNTY OF § BEFORE kE, the undersigned authority, a Notary Public, in and for County, on this day personal y appeare known by me to be the of Clovis National Bank, and he acknowledged to me that he executed the same as'tne act and deed of the Clovis National Bank for the purposes and consideration therein expressed and as tine act of said Bank. GIVEN under my hand and seal of office this day of P.1982. Notary Public in and for County, My Commission Expires: STATE OF § COUNTY OF § BEFORE ME, the undersigned authority, a Notary Public, in and for County, , on this day personally -appeared , known by me to be the of First National Bankette Agri - Corp, and he acknowledged to me that he executed the same as the act and deed of the First National Bankette Agri -Corp for the pur- poses and consideration therein expressed and as the act of said Bank. GIVEN under my hand and seal of office this day of '1982. Notary Public in and tor County, My Commission Expires: 11 of 11 1 0% t 1 X f OZ m _ m ct H m INI N1 1 H to W ' � jj10 ln1 Q� tJ� v 0 nz CA w r'IQ 1 G g a w pi A� J a r. Pi f H a a x y~ m r.. f tp "6 Ln -4: i co m neC) sv 1 to �1 X r ,a (Dw 1b t R N of D, o y o w i — of t - mmmH- M -� 1- O rt O O n 0 O 1 n uai �w E m D (n D X M m w HQ w � W n rtN .. N O Ii N� N , H m EXHIBIT "A" A tract of land being part of Section 1, 2, and 3 John H. Stephens, Block S-3 Bailey County, Texas and part of Section 57 WD & FW Johnson, Block Z, Bailey County, Texas containing 1614 acres more or less, described as follows: The South 477.4 acres of Section 57 WD & FW Johnson, Block Z, all of Section 1, the East 364.7 acres of Section 2, and the South 127 acres of the East 356.4 acres of Section 3 John H. Stephens, Block S-3 Bailey County, Texas. EXHIBIT "C" MINIMUM WATER PURCHASES 1984 $ 111,429 1985 117,760 1986 111,259 1987 106,075 1988 100,218 1989 95,147 1990 90,472 1991 86,132 1992 54,20.0 1993 57,200 EXHIBIT "D" Computation of the adjustments to the base rate of $0.15 per one thousand gallons. Producer Price Index - Industrial Commodities as of December, 1980 was 286.6 Assume that the Index is 330 in December, 1983. The price paid per one thousand gallons during 1984 would be computed as follows: 330X $0.15 = $0.1727 Rounded Up to $0.173 In the event the fourth figure is five or less and the third figure is even the rate will be rounded down i.e., $0.1725 will be rounded down to $0.172. If the fourth figure is five or greater and the third figure is odd the rate will be rounded up i.e., $0.1735 up to $0.174. This adjustment will be made each December to the 'rate to be paid the following year. In the event that the Producer Price Index - Industrial Commodities is no longer published, then by mutual agreement an Index similar to the Producer Price Index - Industrial Commodities will be used.