MEMORANDUM 07-89
TO: Mayor Hornaday and Homer City Council
FROM: Lease Committee
DATE:
SUBJECT: Comments on Memorandum 07-78
The Lease Committee had a meeting on Tuesday, May 8 to discuss Memorandum 07-78 from the Economic Development Commission regarding the proposed amendments to the Lease Policies. This memorandum is intended to serve two purposes. The first is to provide the Council with the Lease Committee’s comments on Memorandum 07-78. The second is to provide some additional recommendations regarding amendments to the Lease Policies. These recommendations supplement the original recommendations provided by the Committee. The Council, if it wishes, could adopt these by motion when it votes on Resolution 07-25.
The comments that follow track with the recommendations in Memorandum 07-78 and are in the same order.
Substitute this language for the proposed revision to 13.K:
The Committee strongly recommends that the Council reject this proposed language and that it stick with the original language proposed as part of Resolution 07-25.
This proposed substitute eliminates all references to discouraging speculation. It in fact seems to encourage speculation. It also eliminates references to restricted use areas. It appears to inadvertently set up a situation where the person with the ground lease must comply with restricted use area provisions but those with sub-leases do not. It changes the word may to will and in general, takes a fair amount of control over what happens on the land away from the property owner.
The language proposed by the committee as part of Resolution 07-78 was actually intended to loosen the rules to allow for more sub-leasing under certain conditions. The proposal from the EDC goes too far and is not in the City’s best interest.
Substitute this language for the addition proposed to 3.2 E.
The Committee recommends that the City Council reject this proposed substitution and that it stick with the original proposed amendment contained in Resolution 07-25.
If this
proposed substitution were adopted, it would take away all limits and
guidelines regarding the amount of leased space that could be used for uses
other than those allowed in the restricted use area. This defeats the whole
purpose of establishing a restricted use zone in the first place and creates
too many loopholes. The original amendment proposed by the committee was
intended to loosen the rules somewhat to allow for some limited uses other than
those allowed in restricted use zones but to maintain the integrity and purpose
of establishing a restricted use zone in the first place.
Substitute
this language for 2.2 (A).
The Committee has reservations about adding 1 member from the Economic Development Commission and 1 member from another Commission to the Lease Committee. However, it does see the value in getting input from outside of the administration and it recognizes that this substitution was a comprise position among EDC members.
There are several reasons for this reservation. The first is the potential for conflicts of interest and politically driven decisions. The idea behind the Lease Committee as it is currently comprised is to take the politics out of the leasing process; something we have been told has been a long standing problem. The idea is that you have professional staff people review proposals and that the elected policy makers (or their political appointees) only get involved when it is time to establish policies and procedures and approve leases. The second concern is that some of the information the Committee receives is proprietary in nature and must remain confidential. For example, the Committee requests lots of financial information related to future business plans and financial assets. The purpose of these questions is to help the Committee determine if the applicant has the financial wherewithal and backing to follow-through and do what he says he will do. Applicants do not want this information shared with the public or their competitors. The third concern is that the Committee is intimately involved in the negotiaton of lease documents. This is properly the job of the administration and those negotiations should remain private until there is a final lease document acceptable to both parties that is ready for Council consideration.
Section 2.2 (A).
Several Council meetings ago, Council Member Stark stated that he thought the City Manager should not be on the Lease Committee because he supervises the other members of the Committee and could therefore, have a large influence over how they might vote. This topic also came up during the EDC discussion of the Lease Polices but it was not mentioned in Memorandum 07-78.
The Lease committee discussed this and concluded that it would be a good idea to take the Manager off of the Committee and replace him or her with either the Public Works Director or the City Clerk or both. The Manager would be remain involved in actual lease negotiations but would not be involved in scoring or evaluating lease proposals. We recommend that 2.2 (A) be amended to read as follows:
2.2 (A)
The City Manager shall establish a Lease Committee that will consist at a minimum of the Finance Director, the City Planner, the Port and Harbor Director, the Public Works Director, and the City Clerk. The Lease Committee may consult with other departments such as the Fire Chief and the Police Chief and/or outside professionals as needed and appropriate.