HomeMy WebLinkAbout09 - License Agreement for Installation and Operation of an Electric Watercraft Charging Station at Marina Park Located at 1600 West Balboa BoulevardQ �EwPpRT
CITY OF
s NEWPORT BEACH
`q44:09 City Council Staff Report
May 14, 2024
Agenda Item No. 9
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Paul Blank, City Harbormaster - 949-270-8159,
pblank@newportbeachca.gov
PREPARED BY: Lauren Wooding Whitlinger, Real Property Administrator -
949-644-3236, Iwooding@newportbeachca.gov
TITLE: License Agreement with Aqua Superpower (USA), Inc. for Installation
and Operation of an Electric Watercraft Charging Station at Marina
Park Located at 1600 West Balboa Boulevard
ABSTRACT:
The City of Newport Beach owns the Marina Park Community Center (Marina Park)
property. The site includes many public amenities including a playground, public
restrooms, community rooms, a restaurant, and a visitor -serving public marina. With the
growing popularity of electric vehicles on the streets, and the push toward reducing
environmental impacts by reducing emissions, electric watercraft is a fast-growing
industry. Charging stations, similar to those used for electric vehicles, will be needed to
address the battery charging needs of electric watercraft. For the City Council's
consideration is a License Agreement (Agreement) with Aqua Superpower (USA), Inc.
(Aqua), to install, maintain and operate electric watercraft charging equipment, open to
the public, on the docks at Marina Park. The Agreement is included in this report as
Attachment A.
RECOMMENDATIONS:
a) Find this project exempt from the California Environmental Quality Act (CEQA)
pursuant to Section 15301 (Existing facilities) and Section 15303 (New construction
of small structures) of the CEQA Guidelines, because this project has no potential to
have a significant effect on the environment;
b) Authorize the City Manager and City Clerk to execute the License Agreement between
the City of Newport Beach and Aqua Superpower (USA), Inc. for use of a portion of
the City of Newport Beach owned property and public dock at Marina Park located at
1600 West Balboa Boulevard, for installation, operation, and maintenance of electric
watercraft charging equipment, in a form substantially similar to the License
Agreement prepared by the City Attorney; and
c) Approve a waiver of City Council Policy F-7 — Income and Other Property based on
the findings contained in this staff report and the Agreement, that conducting an open
bid process would result in excessive vacancy, and this use of the property provides
a unique service to the community and is of a public benefit, and might not otherwise
be provided were an open bid required.
9-1
License Agreement for Installation and Operation of an Electric Watercraft
Charging Station at Marina Park Located at 1600 West Balboa Boulevard
May 14, 2024
Page 2
DISCUSSION:
Marina Park is located at 1600 West Balboa Boulevard, on the Balboa Peninsula. The
community center property includes a 23-slip visitor -serving marina with 40-foot and
55-foot slips available to be reserved by the public for a maximum continuous stay of
30 days. The marina includes in -slip pump -out and water supply, shore power, free
Wi-Fi, and laundry, shower and restroom facilities are also available to guests staying in
the marina.
In addition to the marina amenities, visitors to the site have access to the on -site beach,
park, picnic area, playground and restaurant. There is dock space available at the facility
for mariners who want to use on -site amenities but do not plan to stay overnight. The site
also has electric vehicle charging stations located in the main parking lot.
Electric watercraft is fast becoming the focus of efforts to further address ocean
preservation and conservation and to reduce emissions in California and globally. While
the use of small battery -powered vessels has been popular for many years with
recreational users in Newport Harbor, the State's focus has recently shifted to reducing
emissions of short -run ferries like the locally operated Balboa Island Ferry. With the
governmental shift toward reducing emissions of working watercraft, it is anticipated that
the push toward zero emissions will further require public agency work vessels and
eventually personal watercraft to convert to electrical power.
Similar to the roll -out history for electric vehicle charging stations, electric vessel charging
is in its infancy and there are not many companies with marine chargers ready to install.
Aqua is one of few companies with charging stations being rolled out across Europe and
the United States. Aqua has already installed stations in Florida, Michigan, Lake Tahoe,
Nevada and Richmond, California. In addition to seeking a location in Newport Beach,
Aqua is working to establish a location at the harbor in Avalon on Santa Catalina Island,
and in other harbors in California.
Founded to focus on reducing the impact of boating on oceans and waterways, Aqua is
supporting the shift toward electric boating by developing and installing infrastructure for
marine fast chargers to serve recreational and commercial boat users. Aqua's fast
chargers allow electric vessels to charge in 20-90 minutes, on average, whereas typical
shore power can take more than three days to charge, depending on the size and type of
battery and the power supply.
The City's Harbor Commission and Harbor Department began discussions with
representatives of Aqua in 2018 in anticipation of the proliferation of commercial and
recreational vessels powered by electricity. The history of electric craft in Newport Harbor
makes it the perfect location for this service expansion. When installed at Marina Park,
the Aqua charger will be a first for any municipal agency and the first such charger that is
publicly accessible west of the Mississippi River.
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License Agreement for Installation and Operation of an Electric Watercraft
Charging Station at Marina Park Located at 1600 West Balboa Boulevard
May 14, 2024
Page 3
City Council Policy F-7, Income and Other Property
Due to the unique service provided by Aqua, staff did not conduct an open bid process to
solicit proposals from other operators, as typically required by City Council Policy F-7,
Income and Other Property (Policy) (Attachment C).
Staff believes the following findings can be made, as required by the Policy, when an
open bid is not conducted, and a waiver is requested:
1. Converting the property to another use or changing the operator of the property
would result in excessive vacancy, which would outweigh other financial benefits;
and
2. Aqua provides an essential or unique service to the community that might not
otherwise be provided were an open bid required.
Summary of Proaosed Aareement
The proposed terms of the Agreement are summarized below:
1. The initial term is 8 years, with three additional 5 year options, unless terminated
earlier as provided by the Agreement;
2. The License Fee shall be set at $3,000 per year, payable in equal quarterly
installments, and shall be adjusted annually by the change in the Consumer Price
Index;
3. Profit sharing calculated as a percentage of the revenues from the electric
watercraft charging station shall be paid to the City. Ten percent of the gross profit
up to $10,000, and 15% of the gross profit over $10,000 shall be paid, less the
License Fees paid for the quarter, and less the cost of the electricity;
4. Installation, maintenance and service, and replacement of the charging station
equipment shall be the sole cost and expense of Aqua, including the cost of any
utilities necessary for the operation. Installation, maintenance and service must
comply with the City's standard construction hours and permitting requirements;
5. The charging equipment may only be used to charge watercraft between the hours
of 6 a.m. and 10 p.m., and may be temporarily restricted by the City for special
events or emergencies; and
6. Aqua shall provide certificates of insurance to the satisfaction of the City's Risk
Manager, naming the City as additional insured.
The Agreement has been reviewed by the City Attorney's Office, and has been approved
as to form. Aqua has reviewed and approved the terms of the Agreement.
9-3
License Agreement for Installation and Operation of an Electric Watercraft
Charging Station at Marina Park Located at 1600 West Balboa Boulevard
May 14, 2024
Page 4
FISCAL IMPACT:
The $3,000 annual license fee and any additional profit-sharing revenues collected
pursuant to this Agreement will be posted to the Tidelands Operating Fund Real Property
accounts in the Community Development Department, 10050505-551153.
ENVIRONMENTAL REVIEW:
Staff recommends the City Council find this project exempt from the California
Environmental Quality Act (CEQA) pursuant to Section 15301 (Existing facilities) and
Section 15303 (New construction of small structures) of the CEQA Guidelines, California
Code of Regulations, Title 14, Chapter 3, because it has no potential to have a significant
effect on the environment. The project entails installation of small new equipment, but no
new structures will be constructed at the property, nor will substantial modifications to the
existing public dock improvements be made. The equipment is a watercraft charging
station, and the amenity will be available to the public.
NOTICING:
The agenda item has been noticed according to the Brown Act (72 hours in advance of
the meeting at which the City Council considers the item).
ATTACHMENTS:
Attachment A — License Agreement
Attachment B — Map
Attachment C — City Council Policy F-7, Income and Other Property
Attachment A
License Agreement
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LICENSE AGREEMENT
BETWEEN THE CITY OF NEWPORT BEACH
AND
AQUA SUPERPOWER (USA), INC.
This License Agreement ("Agreement") is made and entered into as of this 12th
day of April, 2024 ("Effective Date"), by and between the City of Newport Beach, a
California municipal corporation and charter city ("City"), and AQUA SUPERPOWER
(USA), INC., a Delaware corporation ("Aqua"), whose address is 1016 Farnam Street,
Los Angeles, California 90042. City and Aqua are referred to hereinafter individually as
"Party" and collectively as "Parties."
RECITALS
A. City is the fee title owner of the real property, including marina improvements,
known as Marina Park, located at 1600 West Balboa Boulevard in the City of
Newport Beach, California ("Property').
B. Aqua desires to install, operate, and maintain electric watercraft charging
equipment ("ECE"), as more fully described herein, for the public's use on
certain locations of the Property as more specifically depicted in Exhibit "A"
("License Area"), attached hereto and incorporated herein by reference.
C. The installation of the ECE at the Property will provide for greater access of
such charging services to the public.
D. Pursuant to City Council Policy F-7, Section (E) the City did not conduct an
open bid process or charge fair market value for the use of the License Area
because the ECE provides an essential and unique service to the community
that might not otherwise be provided were full market value of the property
charged. Additionally, Aqua's proposed use of the License Area promotes the
goals of the City to support marine related services to the public by providing a
charging stations for electric vessels.
E. City and Aqua have agreed to enter into this Agreement regarding Aqua's
installation, operation, and maintenance of the ECE at the License Area upon
the terms, conditions and other considerations set forth herein.
NOW THEREFORE, THE PARTIES AGREE AS FOLLOWS:
1. LICENSE
1.1 City grants an exclusive license ("License") to Aqua for the term of this
Agreement, to install, operate, repair, maintain, and remove the ECE on the License Area.
City further grants Aqua a non-exclusive license to use any other areas of the Property
for the sole purpose of providing access to the License Area. The License granted herein
is subject to the terms, covenants and conditions hereinafter set forth, and Aqua
covenants, as a material part of the consideration for this License, to keep and perform
AQUA SUPERPOWER (USA), INC. Page 1
each and every term, covenant and condition of this Agreement. Watercraft electric
charging equipment outside of the Property and electric charging equipment for uses
other than watercraft are not covered under the License.
1.2 All ECE to be installed on the License Area shall conform to the equipment
specifications ("Equipment Specifications") as depicted in Exhibit "B" and as reviewed by
and on file as a public record with the City's Community Development and Public Works
Departments, as may be required. All installation, maintenance, operation, repair, and
removal activities shall be at Aqua's sole cost and expense, including but not limited to
the fees and costs associated with all such activities and any required utilities or meters,
as identified in the Improvement Drawings. The City is not responsible for any damage
caused to the ECE by third -parties or acts of God.
1.3 All of Aqua's construction and installation work shall be performed at Aqua's
sole cost and expense and in a good and workmanlike manner and the Improvement
Drawings reviewed and permitted by the City, and in compliance with all applicable
ordinances, regulations or law.
1.4 Notwithstanding Aqua's construction and installation of the ECE, Aqua's
interest in the License Area shall be restricted to this License and the City retains all
rights, title and interest in the License Area.
1.5. This License does not authorize Aqua to install ECE within the public right -
of way.
1.6 Aqua shall at its sole cost and expense comply with all applicable federal,
state and/or local laws and regulations.
2. PERMITS, APPROVALS AND PUBLIC NOTIFICATION
2.1 Aqua shall secure all applicable entitlements, coastal development
approvals, building and encroachment permits, and/or other permits and approvals
necessary for and prior to installing the ECE at the License Area. Aqua shall obtain all
applicable approvals, licenses, and permits from the City and other governmental entities
prior to installation of the ECE.
2.2 Any modifications to ECE shall be subject to further review, submittal, and
written approval by City, including any additional permits required from City; provided,
Aqua may remove or swap out, like for like, any ECE without such further review or
approval.
3.1 Aqua shall keep the License Area free from hazards or risk to the public
health, safety or welfare.
3.2 Except as provided under this Agreement Aqua shall not make or permit to
be made any alterations, additions or improvements to the License Area, or paint, install
Aqua Superpower (USA), Inc. Page 2
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lighting or decorations, or install any signs, lettering or advertising media of any type or
any other visual displays, on or about the License Area without the prior written consent
of City. Notwithstanding the foregoing, Aqua shall place warning signs on or about the
ECE in the event that such signs are required by federal, state or local law.
3.3 Aqua hereby acknowledges, agrees and covenants that this Agreement
does not authorize or bestow any rights to sublease the License Area.
3.4 The purpose of this License is to allow for the installation, operation, repair
and maintenance of ECE within the License Area. Use of any area outside the License
Area shall not be permitted unless prior written consent is provided by the City. Aqua
agrees to use the License Area only for the activities described herein, and not to use or
permit the use of the License Area for any other purpose without first obtaining the prior
written consent of City, which consent may be withheld in City's sole and absolute
discretion.
4. TERM
4.1 The initial term of this Agreement shall be eight (8) years, commencing on
the Effective Date and expiring on April 11, 2032, unless terminated earlier as set forth
herein ("Initial Term"). The term of this Agreement ("Term") shall be the Initial Term and
Additional Term(s), if any.
4.2 This Agreement may be extended for up to three (3) additional five (5) year
terms (each an "Additional Term") subject to the City's determination that (i) Aqua is in
compliance with the terms of the Agreement; (ii) a copy of all required licenses, permits
and certificates are on file with the License Administrator (as defined in Agreement
Section 7, below); and (iii) Aqua is not in default of the Agreement. Any renewals must
be in writing and approved as to form by the City Attorney.
5. FEES, PROFIT SHARE, AND COSTS
5.1 License Fee. As compensation for Aqua's use of the License Area, Aqua
shall pay to City an annual license fee in the amount of Three Thousand Dollars and
00/100 ($3,000.00) per License Area ("License Fee"). The License Fee shall be payable
in amounts equal to one-fourth (1/4) of the annual License Fee and no later than five (5)
days after the due date. The License Fee may be paid in advance.
5.1.1 The first payment of the License Fee shall be due upon the first day
of operation of the ECE at the respective License Area or forty five (45) calendar days
following the Effective Date, whichever date is first. The amount of the first License Fee
payment shall be prorated based upon the number of days remaining in the current
calendar quarter.
5.1.2 Subsequent payments of the License Fee shall be due on the 1st day
of January, April, July, and October of each successive calendar year.
Aqua Superpower (USA), Inc. Page 3
.;
5.2 Profit Shares. In consideration for the grant of the License, Aqua shall pay
City the following percentages of its profits ("Profit Share"):
5.2.1 Base Profit Share equal to 10% of the Gross Profit (as defined
herein) to be paid quarterly; and
5.2.2 Incremental Profit Share equal to 15% of the Gross Profit in excess
of Ten Thousand Dollars and 00/100 ($10,000) per ECE per annum to be paid annually.
This is additional to the Base Profit Share.
5.3 Gross Profit. "Gross Profit" shall mean the sum profit for all ECE. Profit for
each ECE shall be calculated as follows:
5.3.1 Revenue from charging services and other income generated by the
ECE in the relevant period less Direct Costs for that ECE in the same period. Direct Costs
are defined as:
5.3.1.1. License Fee paid by Aqua in the relevant period.
5.3.1.2. Electricity Costs relating to electricity consumed by the
ECE paid by Aqua in the relevant period.
5.4 Payment Due Date. Payment of Base Profit Share is due no later than the
251h day of January, April, July, and October (twenty-five (25) days after the end of each
calendar quarter). In quarters where Base Profit Share exceeds the License Fee, Aqua
shall pay to City the Base Profit Share less the amount of Direct Costs already paid for
that quarter.
5.5 Accounting and Payment. Aqua shall submit with each Base Profit Share
payment a written statement showing the Gross Profit for that quarter (or fractional quarter
when applicable). The written statement shall be on a form satisfactory to City and
certified by Aqua to be correct.
5.6 Annual Statements of Profit. Within thirty (30) days after the end of each
calendar year during the Term and within thirty (30) days of termination of this Agreement,
Aqua shall furnish to City a statement in writing, prepared by a Certified Public Accountant
and certified by Aqua to be correct, showing the total usage, revenue, and Gross Profit
made from and/or otherwise attributable to the ECE during the preceding calendar year
(or fractional year when applicable) and Direct Costs ("Annual Statement of Profit").
5.6.1 Any losses shall be calculated and reconciled in the Annual
Statements of Profit, and shall not be carried past their respective calendar year. Payment
of any electricity costs due to the City shall not be withheld in the event of a loss.
5.6.2 Incremental Profit Share, if any, shall be paid concurrently with the
submission of the Annual Statements of Profit, based upon the previous four calendar
quarters.
Aqua Superpower (USA), Inc.
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5.7 Late Pam. Aqua hereby acknowledges that the late payment of the
License Fee or other sums due hereunder will cause City to incur costs not contemplated
by this Agreement, the exact amount of which is extremely difficult to ascertain. Such
costs include, but are not limited to, processing and accounting charges. Accordingly,
any payment by Aqua of any sum due more than five (5) calendar days after its due date
shall incur a ten percent (10%) late charge. City and Aqua agree that this late charge
represents a reasonable estimate of such costs and expenses and is fair compensation
to City for its loss suffered by such late payment by Aqua.
5.8 Place for Payment: All payments of amounts due hereunder shall be made
in lawful money of the United States of America and shall be paid to City on line at
www.newportbeachca.gov, in person or by United States' mail, or overnight mail service,
at the Cashier's Office located at 100 Civic Center Drive, Newport Beach, CA 92660, or
to such other address as City may from time to time designate in writing to Aqua. Aqua
assumes all risk of loss and responsibility for late charges and delinquency rates if
payments are not timely received by the City regardless of the method of transmittal,
unless such delay is governed by Section 36 (Force Majeure) herein.
5.9 Interest. All unpaid amounts due shall accrue interest at the rate of ten
percent (10%) per month or any portion of a month until paid in full.
5.10 CPI Adjustment. Upon each anniversary of the Effective Date, the License
Fee shall be adjusted in proportion to changes in the Consumer Price Index, subject to
the maximum adjustment set forth below. Such adjustment shall be made by multiplying
the License Fee by a fraction, the numerator of which is the value of the Consumer Price
Index for the calendar month four (4) months preceding the calendar month for which
such adjustment is to be made, and the denominator of which is the value of the
Consumer Price Index for the same calendar month immediately prior to Effective Date.
The Consumer Price Index to be used in such calculation is the "Consumer Price Index,
All items, 1982-84=100 for All Urban Consumers (CPI-U)", for the Los Angeles — Long
Beach - Anaheim, CA, published by the United States Department of Labor, Bureau of
Labor Statistics. If both an official index and one or more unofficial indices are published,
the official index shall be used. If said Consumer Price Index is no longer published at the
adjustment date, it shall be constructed by conversion tables included in such new index.
In no event, however, shall the amount payable under this Agreement be reduced below
the License Fee in effect immediately preceding such adjustment.
5.11 Additional Fees Due. Any provision in this Agreement that requires Aqua to
pay additional amounts classified as "Additional Fees" shall be paid within thirty (30)
calendar days of City's written demand therefore (unless a different time for payment is
expressly provided in this Agreement). Additional Fees do not reduce or offset Aqua's
obligations to pay License Fees or Profit Shares.
6. PRODUCTION OF STATEMENTS, RECORDS AND AUDIT.
6.1 Aqua Records. Aqua shall keep and maintain full, complete and proper
books, records and accounts of its daily Profit Shares, both for cash and on credit. Aqua
agrees to make available for inspection by City or its authorized designee, a complete
Aqua Superpower (USA), Inc. Page 5
9-10
and accurate set of books and records of all revenue from which Profit Shares can be
determined. Aqua shall also make available, upon City's written request, all supporting
records. Aqua shall also furnish City copies of its quarterly California sales and use tax
returns filed with the State of California. Aqua shall retain and preserve for at least three
(3) years all records, books, bankbooks or duplicate deposit books and other evidence of
Profit Shares.
6.2 City Audit. City shall have the right, not more than once each calendar year,
upon reasonable notice, during the Term and within one hundred eighty (180) calendar
days after expiration or termination of this Agreement to inspect and complete an audit of
Aqua's books and records relating to this Agreement, and to make transcripts to verify
the License Fee and Profit Shares due to City. The audit may be conducted at any
reasonable time during normal business hours. Aqua shall cooperate with City in making
the inspection and conducting the audit. The audit shall be limited to the determination of
Profit Shares and shall be conducted during usual business hours in a manner that
minimizes any interference with the conduct of Aqua's regular business operations.
6.2.1 If the audit concludes that there is a deficiency in the payment of any
Profit Shares, the deficiency shall become due and payable within twenty (20) calendar
days and if there is an overpayment, City shall refund the amount of the overpayment
within twenty (20) calendar days.
6.2.2 City shall bear its costs of the audit unless the audit shows that Aqua
understated Profit Shares by more than two percent (2%), in which case Aqua shall pay
all City's reasonable costs of the audit.
6.2.3 City shall not disclose financial information received in confidence
and pursuant to this Agreement except to carry out the purposes of this Agreement unless
disclosure is required by law or court order. However, City may disclose the results of
any audit in connection with any financing arrangements, pursuant to applicable law, the
sale or transfer of City's interest in the License Area, pursuant to order of a court or
administrative tribunal, or to collect any outstanding Profit Shares.
6.3 Contesting Audit. Aqua may contest the results of City's audit by performing
a contesting audit, at Aqua's expense, within sixty (60) calendar days of receipt of City's
audit results and supporting evidence, using an independent Certified Public Accountant
reasonably accepted by City in writing.
6.4 Third Audit. If Aqua's audit and City's audit vary by greater than ten percent
(10%), or the parties cannot agree on the results of City's or Aqua's audit, then the parties
shall identify, after good faith negotiations, a nationally recognized accounting firm
acceptable to both parties, to complete a third audit, which audit shall be final. The parties
shall equally pay the costs of the third audit.
7. ADMINISTRATION
This License shall be administered by the Harbor Department. The Harbormaster
or his/her designee shall be the "License Administrator" and shall have the authority to
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act for City under this Agreement. The License Administrator or their authorized
representative shall represent City in all matters pertaining to this Agreement.
8. INSTALLATION, OPERATION AND MAINTENANCE OF THE ECE
8.1 Aqua, at its sole cost, shall be responsible for the installation of the ECE at
the License Area. Aqua shall also install and bear the cost of any utilities necessary for
the operation of the ECE. The type of ECE installed shall be consistent with the
Improvement Drawings. Installation shall be performed between 7:00 a.m. and 6:00 p.m.
on non -holiday weekdays.
8.2 In addition, Aqua shall diligently maintain the ECE at Aqua's sole cost and
expense. Aqua shall use commercially reasonable efforts to regularly inspect, service,
clean, and maintain the ECE operating and in good working order, and in a clean and
sanitary condition in accordance with all applicable federal, state and local laws.
8.3 Upon written request from City, Aqua shall use commercially reasonable
efforts to promptly respond to and resolve maintenance issues identified by City;
provided, however, that such response and proposed resolution shall be communicated
to City no more than five (5) business days following City issuing its written request.
8.4 Aqua shall be responsible for repair and maintenance of any portion of the
License Area utilized by it during the Term, as well as all taxes, assessments, electric
charges and other associated operating costs (including metering, communications
insurance) and charging equipment that has been installed and/or is used at the License
Area.
8.5 Aqua shall provide the maintenance and service obligations as further set
forth in Exhibit "C" to this Agreement ("Maintenance and Service Obligations").
8.6 City shall have the right to require Aqua, at its expense, to relocate the ECE
to a different License Area as required by public health, safety, and the general welfare.
9. DAMAGE OR DESTRUCTION
Should the ECE be damaged or destroyed by any cause not due to the negligent
or willful act of City, Aqua shall, at its own cost and expense, promptly repair the same.
Should said damage or destruction substantially impair, in the reasonable judgment of
Aqua, the satisfactory operation of the ECE, Aqua may remove the ECE from the License
Area. The parties shall execute an amendment to the Agreement to memorialize the
removal of the affected ECE from the License Area. If Aqua chooses to remove all of its
ECE due to such damage or destruction, then it may terminate this Agreement by
providing City written notice of such termination not more than thirty (30) calendar days
following the occurrence of such damage or destruction.
Aqua Superpower (USA), Inc. Page 7
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10. CONDITIONS OF OPERATION
10.1 Aqua shall comply with the following conditions of operation during use of
the License Area:
10.1.1 The operating hours of the ECE shall coincide with the operating
hours of the Marina Park parking lot, 6:00 a.m. to 10:00 p.m. daily. City reserves the right
to temporarily modify the hours of operation, in the City's sole and absolute discretion, so
long as (i) the City provides advance written notice of such modification to Aqua and (ii)
such modification shall not last more than seventy-two (72) hours, emergency situations
excluded.
10.1.2 The ECE may be temporarily restricted from operation due to a
special event on the Property, not to exceed ten (10) special events in any single calendar
year, without any compensation or reimbursement to Aqua, so long as (i) the City provides
advance written notice of such restriction to Aqua and (ii) such restriction shall not last
more than seventy-two (72) hours, emergency situations excluded.
10.1.3 Aqua shall be responsible for hiring the necessary personnel to
conduct the operation and maintenance of the ECE. Aqua shall comply with all federal,
state, and local Laws related to minimum wage, social security, nondiscrimination, ADA,
unemployment compensation, and workers' compensation. If required by the City, Aqua's
employees shall wear an identification badge while at the Property.
10.1.4 Aqua may, at its own expense, place unlit signs on the Property
subject to the prior written consent of the City as to the size, type, number, design and
method of installation and in compliance with the City's sign code regulations and any
deed restrictions applicable to the Property. All signage placed by Aqua on the Property
shall remain the property of Aqua and shall be removed by Aqua upon termination or
expiration of this Agreement at Aqua's expense. Installation of any signs shall conform to
all applicable building, zoning and other regulations of any applicable governmental
authority.
10.1.5 Aqua shall not commit or permit any nuisance on the License Area
and shall comply with any and all noise and nuisance rules as defined by any applicable
federal, state and local laws and regulations.
10.1.6 Aqua shall protect the integrity of the License Area and any part of
the Property used for purpose of accessing the License Area. Aqua shall return the
License Area to City in the substantially the same condition, reasonable wear and tear
excluded, as it was upon execution of this Agreement.
10.2 City reserves the right to use its staff to move vessels around at the Property
to efficiently utilize the License Area and nearby human lift. City staff may remove a vessel
from the License Area regardless of charging status, to best utilize or for
health/safety/welfare the public docking facilities in and adjacent to the License Area.
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11. EMERGENCY
11.1 Emergencies may require power to the ECE to be immediately shut off and
thereby interfere or temporarily terminate Aqua's use of its ECE and License Area. Aqua
agrees that if such a situation occurs, and/or there are frequency interferences of any
nature between City's Police and Fire Department public safety communications
equipment or City's facilities affecting operation of sewer or water service and that of Aqua
in a manner that threatens public health or safety, City shall have the right to immediately
shut off power to the ECE and any equipment of Aqua's located on the License Area for
the duration of the emergency. Aqua agrees not to hold City responsible or liable for any
damage, loss, claim or liability of any nature suffered as a result of the loss of the use of
the ECE due to the power shutoff.
11.2 Aqua agrees to install a clearly marked and accessible master power "cut-
off' switch on their ECE for the purpose of assisting City in such an emergency.
11.3 Unless otherwise specifically provided in a notice of termination of this
Agreement, City's exercise of the right to shut off any power to the ECE is not intended
to constitute a termination of this Agreement by either Party and such event is a risk
accepted by Aqua. Aqua and City shall meet after the City determines that an emergency
situation has ended to establish the time and manner in which power shall be restored.
11.4 City shall have the right to reasonably determine what constitutes an
"emergency situation" pursuant to this Section.
12. ACCEPTANCE OF CONDITION OF LICENSE AREA
Aqua accepts use of the License Area in an "as is" condition, with no warranty,
express or implied from the City as to any latent, patent, foreseeable and unforeseeable
condition of the License Area, including its suitability for the use intended by Aqua. To
the best of City's knowledge, the License Area has not been used for generation, storage,
treatment or disposal of Hazardous Substances as defined in this Agreement. Aqua has
conducted its own appropriate due diligence investigation of the License Area prior to its
execution of this Agreement.
13. NO INTEREST IN PROPERTY
Nothing herein shall be deemed to create a lease, or easement of any property
right, or to grant any, possessory or other interest in the License Area, or any public right-
of-way, other than a license to use and access the License Area, revocable and for a
temporary term as set forth in this Agreement.
14. RESERVATION OF RIGHTS
Aqua understands, acknowledges and agrees that any and all authorizations
granted to Aqua under this Agreement shall remain subject to all prior and continuing
regulatory and propriety rights and powers of City to regulate, govern and use the
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Property, as well as any existing encumbrances, deeds, covenants, restrictions,
easements, dedications and other claims of title that may affect the Property.
15. UTILITY FEES
15.1 Aqua shall, at its sole cost, obtain all utilities service necessary for the
operation of the ECE. Aqua shall have separately -metered electricity for the ECE with
Aqua as the customer of record for the meters and shall ensure the installation of a
submeter to measure its utilities usage. Alternatively, Aqua may tap into City's power
source within the License Area and shall pay City a Utility Use Fee. The "Utility Use Fee"
shall be commensurate with the costs incurred by City for Aqua's use of City -provided
utilities and shall be determined in City's sole and absolute discretion. City may increase
or decrease the Utility Use Fee commensurate with costs incurred by City for Aqua's use
of City provided utilities, upon not less than thirty (30) days' notice. Aqua agrees not to
dispute the accuracy of the City's cost determination.
15.2 Aqua shall be responsible for having utilities service installed and/or
connected if already installed. Prior to commencement of any construction, Aqua shall
obtain an encroachment permit from the City and all other permits and approvals
necessary for installation of the ECE and submit for City's approval its plans for
construction of any required utility lines.
15.3 Neither City nor Aqua has any responsibility or liability for interruption,
curtailment, failure, or defect in the supply or character of utilities furnished to the ECE,
unless the cause of the interruption is covered by the party's indemnity provided for in
Section 26.
16. INSPECTION
City shall be entitled, at any time, without prior notice, to visually inspect the
License Area and ECE for compliance with the terms of this Agreement, and with all
applicable Federal, State and local (including those of the City) government regulations.
17. AQUA'S RETENTION OF TITLE
Title to the ECE placed on the License Area by Aqua shall be held by Aqua or its
equipment lessors, successors, or assigns. The ECE shall not be considered a fixture.
Aqua has the right to remove the ECE at its sole expense from time -to -time and in all
events by the expiration of this Agreement or within sixty (60) calendar days after an early
termination of this Agreement.
18. SURRENDER; REMOVAL OF ECE
18.1 Upon expiration or termination of this Agreement, or amendment of this
Agreement removing a License Area from Exhibit A, Aqua at its sole cost and expense,
shall within sixty (60) calendar days of written notice from City, remove the ECE, restore
the License Area to its original condition, ordinary wear and tear excepted, and vacate
the License Area. Should Aqua fail to restore the License Area to a condition satisfactory
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to City, City may perform such work or have such work performed by others and Aqua
shall within sixty (60) calendar days reimburse City for all direct and indirect costs
associated with such work upon receipt of an invoice for such costs.
18.2 Aqua shall continue to pay the License Fee until the License Area is so
restored as required by this Agreement.
18.3 City shall have the right to dispose of ECE and other property of Aqua
remaining at the License Area in such manner as it may deem fit and to charge Aqua for
the reasonable costs of such removal, disposal, and repair which reasonable costs Aqua
shall pay promptly following written notice and demand.
19. ASSIGNMENT
19.1 All of the terms and provisions of this Agreement shall inure to the benefit
of and shall be binding upon the Parties and their respective successors and assigns.
This Agreement and the rights and obligations of Aqua shall not be assigned, transferred,
or hypothecated (collectively referred to as "transferred"), in whole or in part, without the
express written consent of the City, which consent shall not be unreasonably withheld,
delayed or conditioned and may be withheld if assignee is of lesser financial status than
Aqua when this Agreement was executed; provided, however, that Aqua may assign its
rights and obligations in and under this Agreement to a successor by merger or acquisition
or successor to all or substantially all of its assets at any time and without consent (a
"Change in Control"). Any attempted transfer in violation of this Section shall be null and
void. Notwithstanding the above, Aqua shall provide City at least thirty (30) calendar days
advance written notice prior to any proposed transfer or Change in Control.
19.2 If Aqua desires at any time to effect a transfer, it shall first deliver to City:
(1) a written request for approval; (2) the name, address and most recent financial
statements of the proposed transferee; and (3) the proposed instrument of assignment or
sublease, which in the case of assignment shall include a written assumption by the
assignee of all obligations of this Agreement arising from and after the effective date of
assignment. City may approve or deny Aqua's transfer request in its sole and absolute
discretion. The requirements of this Section 19.2 shall not apply in the event of a Change
in Control.
20. TAXES
Aqua shall pay all personal interest property taxes, real property taxes, fees and
assessments which may at any time be imposed or levied by any public entity and
attributable to the ECE authorized herein. City hereby gives notice to Aqua, pursuant to
Revenue and Tax Code Section 107.6 that this Agreement may create a possessory
interest that is the subject of property taxes levied on such interest, the payment of which
taxes shall be the sole obligation of Aqua.
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21. DEFAULT AND TERMINATION
21.1 Termination For Cause. This Agreement may be, upon not less than thirty
(30) calendar days' written notice, terminated for cause by either Party in the event of the
following:
21.1.1 Material Breach. The other Party breaches or fails to perform any of
its obligations in any material respect, and such breach or failure continues uncured for
ten (10) business days after receipt of written notice.
21.1.2 Assignment. The other Party attempts to assign or otherwise transfer
its rights, obligations or duties under this Agreement in a manner prohibited by this
Agreement.
21.1.3 Insolvency. The other Party becomes insolvent or proceedings are
instituted by or against it under any provision of any federal or state bankruptcy or
insolvency laws.
21.1.4 Default; Failure to Cure. The failure of Aqua to observe or perform
any of the covenants, conditions or provisions of this Agreement, except when caused by
Aqua's financial distress or the inability to make a profit or avoid a financial loss, and
where such failure continues for a period of thirty (30) calendar days after written notice
of default from City to Aqua shall constitute default of the Agreement; provided, however,
that if the nature of Aqua's default is such that more than thirty (30) calendar days are
reasonably required for its cure, then Aqua shall not be deemed to be in default if Aqua
commences such cure within said thirty (30) calendar day period and thereafter diligently
prosecutes such cure to completion. However, for any environmental event involving
Hazardous Substances at the License Area caused by Aqua or Aqua's agents or
customers, Aqua shall immediately commence its best efforts to fully remediate, or prove
to the reasonable satisfaction of City that remediation is underway, and complete
remediation in ninety (90) calendar days without any risk of further environmental damage
to the License Area and/or surrounding area.
21.2 Termination for Convenience by City. City shall have the unilateral right to
terminate this Agreement without liability upon ninety (90) days' prior written notice of
termination to Aqua if City determines that any License Area is no longer appropriate for
use by Aqua due to public emergency or another matter of significant public interest or if
City Council finds that the License Area is necessary for City to use to provide for the
public health, safety, or welfare. However, City shall not have the right to terminate for
convenience during the Initial Term.
21.3 Termination for Convenience by Aqua. Aqua shall have the right to
terminate this Agreement at any time prior to the submission of the permit application for
construction of the ECE at the Property or in the event that Aqua determines that the
construction or continued operation of the ECE is impracticable or uneconomical.
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22. CONSTRUCTION
22.1 Aqua agrees to take all prudent action to protect the License Area and the
Property from any damage or injury caused by any work performed by or on behalf of
Aqua regarding the construction, installation, operation, inspection, maintenance, repair,
reconstruction, replacement, relocation, or removal of the ECE or the failure, deterioration
or collapse of such ECE's.
22.2 Without limitation of any other remedy available hereunder or at law or in
equity, if Aqua fails to repair or refinish any such damage to the License Area or the
Property, City may, at its sole discretion, but not be required to, repair or refinish such
damage and Aqua shall reimburse City of all costs and expenses incurred in such repair
or refinishing.
23. MAINTENANCE
23.1 At its sole cost and expense, Aqua shall take good care of the ECE and
keep ECE clean and free from graffiti at all times.
23.2 Aqua shall, at its sole cost and expense, continually maintain and repair any
damage to the License Area, to the extent such damage is caused by Aqua or any of its
agents, representatives, employees, contractors, subcontractors, or invitees. Aqua shall
immediately notify the License Administrator and the appropriate public safety agency
(e.g., police and fire department) of any damage or injury caused by work authorized
pursuant to this Agreement.
23.3 Aqua agrees that it will keep the License Area in "Good Condition," which
is defined to mean the clean, safe, physical condition and in compliance with all applicable
governmental laws and regulation. At all times during the Term, Aqua shall, at its sole
cost and expense, maintain the ECE, all of its equipment at the License Area and utility
supply lines and equipment in good order, condition and repair, and Aqua shall comply
with all laws applicable thereto. Any repairs necessary to keep the License Area and the
ECE in Good Condition shall be completed within 12 hours of notice of nonoperation by
City. Aqua shall give notice to the City if such repairs cannot be made or replacement is
not feasible.
24. INDEMNIFICATION
24.1 To the fullest extent permitted by law, Aqua shall indemnify, defend and
hold harmless City, its City Council, boards and commissions, officers, agents, volunteers
and employees (collectively, the "Indemnified Parties") from and against any and all third
party claims (including, without limitation, claims for bodily injury, death or damage to
property), demands, obligations, damages, actions, California Coastal Commission
enforcement actions, causes of action, suits, losses, judgments, fines, penalties,
liabilities, costs and expenses (including, without limitation, attorney's fees,
disbursements and court costs) of every kind and nature whatsoever (individually, a
Claim; collectively, "Claims"), which may arise from or in any manner relate (directly or
indirectly) to Aqua's breach of the terms and conditions of this Agreement, any latent or
Aqua Superpower (USA), Inc. Page 13
patent defects in the design and construction of the ECE or work thereon conducted under
this Agreement including, without limitation, defects in workmanship or materials or
Aqua's presence or performance of duties on the License Area (including the negligent
and/or willful acts, errors and/or omissions of Aqua, its representatives, agents, officers,
directors, managers, members, shareholders, partners contractors or employees,
vendors, suppliers, subcontractors ("collectively, "Related Parties"), anyone employed
directly or indirectly by any of them or for whose acts they may be liable or any or all of
them).
24.2 Notwithstanding the foregoing, nothing herein shall be construed to require
Aqua to indemnify the Indemnified Parties from any Claim arising from the negligence or
willful misconduct of the Indemnified Parties. Nothing in this indemnity shall be construed
as authorizing any award of attorney's fees in any action on or to enforce the terms of this
Agreement. This indemnity shall apply to all claims and liability regardless of whether
any insurance policies are applicable. The policy limits do not act as a limitation upon the
amount of indemnification to be provided by Aqua.
25. LIMITATION OF LIABILITY
25.2 Hold Harmless Clause. Aqua releases the City and agrees to indemnify,
defend and hold harmless the City, its City Council, Boards, Commissions, Committees,
officers, agents, volunteers, and employees, as well as the State of California, its officers,
employees and volunteers (collectively, the "Indemnified Parties") from and against any
and all claims (including, without limitation, claims for bodily injury, death or damage to
property), demands, obligations, damages, actions, causes of action, suits, losses,
judgments, fines, penalties, liabilities, costs and expenses (including, without limitation,
attorney's fees, disbursements and court costs) of every kind and nature whatsoever
(individually, a "Claim"; collectively, "Claims"), which may arise from or in any manner
relate (directly or indirectly) to Aqua, Aqua's employees, contractor, subcontractor,
agents, guests, invitees, subtenant's possession, occupation or use of the License Area,
specifically including, without limitation, any claim, liability, loss, or damage arising by
reason of:
25.2.1 The death or injury of any person or damage to personal property
caused or allegedly caused by the condition of the License Area which Aqua, alone, is
obligated to maintain, or an act or omission of Aqua or any agent, contractor,
subcontractor, supplier, employee, servant, or sublessee of Aqua;
25.2.2 Any work performed on the License Area or materials furnished to
the License Area at the request of Aqua or any agent or employee of Aqua, with the
exception of maintenance performed by City to the License Area and/or any work done
to any City vessel at the License Area by any City employee or agent; or
25.2.3 Aqua's failure to perform any provision of this Agreement or to
comply with any requirement of law or any requirement imposed on the License Area by
any duly authorized governmental agency or political subdivision.
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Aqua's obligations pursuant to this Section shall not extend to any Claim
proximately caused by the negligence, willful misconduct, or unlawful or fraudulent
conduct on the part of the Indemnified Parties, and/or the failure by the City to perform
City's obligations under this Agreement, such as maintenance and repair of the bulkhead
areas as described above. This indemnity shall apply to all claims and liability regardless
of whether any insurance policies are applicable.
25.3 Exculpation of City. Except as otherwise expressly provided in this
Agreement, City shall not be liable to Aqua for any damage to Aqua or Aqua's property
from any cause other than the sole negligence, intentional or willful acts of the Indemnified
Parties. Except as otherwise expressly provided in this Lease, Tenant waives all claims
against the Indemnified Parties arising for any reason other than the sole negligence,
intentional or willful acts of the Indemnified Parties. City shall not be liable to Aqua for
any damage to the License Area, Aqua's property, Aqua's goodwill, or Aqua's business
income, caused in whole or in part by acts of nature.
25.4 Aqua, or any successor or authorized assign, shall bear all costs incurred
in connection with Aqua's or its employees', contractors', subcontractors' or agents'
planning, design, installation, construction, maintenance, repair, operation and removal
of the ECE. City shall not be responsible or bear any cost for repair of any damage or
movement of the ECE due to repair, maintenance and/or failure/collapse of any existing
gas, water and sewer lines or any other improvements or works approximate to the ECE,
except for the active negligence or willful misconduct of the City, its officers, agents,
employees, contractors or subcontractors. City shall not be responsible or bear any cost
for repair or replacement of any streetlight, or any other Property which may be damaged
as a result of installation, except for the active negligence or willful misconduct of the City,
its officers, agents, employees, contractors or subcontractors. City shall not be
responsible for damage caused to the ECE as a result of the actions or inactions of other
parties, including, but not limited to, damage resulting from traffic accidents or contractors
not employed by the City.
26. NO DAMAGES
Aqua acknowledges that City would not enter into this Agreement if it were to be
liable for damages (including, but not limited to, actual damages, economic damages,
consequential damages, lost profits, loss of rents or other revenues, loss of business
opportunity, loss of goodwill or loss of use) under, or relating to, this Agreement or any of
the matters referred to in this Agreement, including, without limitation, any and all plans,
permits, licenses or regulatory approvals, and CEQA documents. Accordingly, Aqua
covenants and agrees on behalf of itself and its successors and assigns, not to sue City
(either in its capacity as lessor in this Agreement or in its capacity as the City of Newport
Beach) for damages (including, but not limited to, actual damages, economic damages,
consequential damages, lost profits, loss of rents or other revenues, loss of business
opportunity, loss of goodwill or loss of use) or monetary relief for any breach of this
Agreement by City or for any dispute, controversy, or issue between City and Aqua arising
out of or connected with this Agreement or any of the matters referred to in this
Agreement, including, without limitation, any and all plans, permits, licenses or regulatory
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approvals, CEQA documents, or any future amendments or enactments thereto, the
parties agreeing that declaratory relief, injunctive relief, mandate and specific
performance shall be Aqua's sole and exclusive judicial remedies. This clause is only
applicable while the City is the owner under this Agreement and does not apply to any
successor to all or any part of the City interest in this Agreement.
27. INSURANCE
27.1 Without limiting Aqua's indemnification of City, and prior to commencement
of work, Aqua shall obtain, provide and maintain at its own expense during the term of
this Agreement or for other periods as specified in this Agreement, policies of insurance
of the type, amounts, terms and conditions described in the Insurance Requirements
attached hereto as Exhibit "D" and incorporated herein by reference.
27.2 Any contractors hired by Aqua shall be fully licensed and bonded. Aqua's
contractors and any subcontractors shall obtain insurance in an amount and form to be
approved by City's Risk Manager, including workers compensation insurance as required
by law, general liability, automobile liability and builder's risk insurance covering
improvements to be constructed, all pursuant to standard industry custom and practice.
City, its City Council, boards and commissions, officers, agents, volunteers and
employees shall be named as an additional insured on the contractor's and any
subcontractor's policies.
28. HAZARDOUS SUBSTANCES
28.1 From the date of execution of this Agreement throughout the Term, Aqua
shall not store, manufacture or maintain on the License Area any Hazardous Substances
except (i) in such quantities and types found customary in construction, repair,
maintenance and operations of the ECE approved by this Agreement, (ii) natural gas, or
petroleum and petroleum products contained within regularly operated motor vehicles.
Aqua shall handle, store and dispose of all Hazardous Substances it brings onto the
License Area or any the Property in accordance with applicable laws.
28.2 For purposes of this Agreement, the term "Hazardous Substance" means:
(i) any substance, product, waste or other material of any nature whatsoever which is or
becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental
Response, Compensation and Liability Act, 42 U.S.C. Section 9601 et seq. ("CERLCA");
the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the
Resource Conversation and Recovery Act, 42 U.S.C. Section 6901 et seq. ("RCRA"); the
Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33
U.S.C. Section 1251 et seq.; the California Hazardous Waste Control Act, Health and
Safety Code Section 25100 et seq.; the California Hazardous Substance Account Act,
Health and Safety Code Sections 25330 et seq.; the California Safe Drinking Water and
Toxic Enforcement Act, Health and Safety Code Sections 25249.5 et seq.; California
Health and Safety Code Sections 25280 et seq. (Underground Storage of Hazardous
Substances); the California Hazardous Waste Management Act, Health and Safety Code
Sections 25170.1 et seq.; California Health and Safety Code Sections 25501 et seq.
(Hazardous Materials Response Plans and Inventory); or the Porter -Cologne Water
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Quality Control Act, Water Code Sections 13000 of seq., all as they, from time -to -time
may be amended, (the above -cited statutes are here collectively referred to as "the
Hazardous Substances Laws") or any other Federal, State or local statute, law,
ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or
imposing liability or standards of conduct concerning, any hazardous, toxic or dangerous
waste, substance or material, as now or at any time hereafter in effect; (ii) any substance,
product, waste or other material of any nature whatsoever which may give rise to liability
under any of the above statutes or under any statutory or common law theory, including
but not limited to negligence, trespass, intentional tort, nuisance, waste or strict liability or
under any reported decisions of a state or federal court; (iii) petroleum or crude oil; and
(iv) asbestos.
28.3 Notwithstanding any contrary provision of this Agreement, and in addition
to the indemnification duties of Aqua set forth in this Agreement, Aqua agrees to
indemnify, defend , protect, and hold harmless the City, its officials, officers, employees,
agents, and assigns from and against any and all losses, fines, penalties, claims,
damages, judgments, or liabilities, including, but not limited to, any repair, cleanup,
detoxification, or preparation and implementation of any remedial, response, closure or
other plan of any kind or nature which the City, its officials, officers, employees, agents,
or assigns may sustain or incur or which may be imposed upon them in connection with
the use of the License Area provided under this Agreement by Aqua, arising from or
attributable to the storage or deposit of Hazardous Substances on or under the License
Area by Aqua. This Section is intended to operate as an agreement pursuant to Section
107(e) of CERCLA, 42 USC Section 9607(e), and California Health and Safety Code
Section 25364, to insure, protect, hold harmless, and indemnify City for any claim
pursuant to the Hazardous Substance Laws or the common law.
28.4 City and Aqua shall not, and will not authorize any third party to, use,
generate, store, or dispose of any Hazardous Substances on, under, about or within the
License Area in violation of any law or regulation. City and Aqua each agree to defend,
indemnify and hold harmless the other and the other's partners, affiliates, agents and
employees against any and all losses, liabilities, claims and/or costs arising from any
breach of any representation, warranty or agreement contained in this Section. This
Section shall survive the termination of this Agreement. Upon expiration or earlier
termination of this Agreement, Aqua shall surrender and vacate the License Area and
deliver possession thereof to City on or before the termination date free of any Hazardous
Substances released into the environment at, on or under the License Area that are
directly attributable to Aqua.
29. COMPLIANCE WITH LAWS
Aqua, at its sole cost, shall observe, perform, and comply with all laws, statutes,
ordinances, rules, and regulations promulgated by any governmental agency and
applicable to the ECE and the License Area, or the use thereof, including all RF safety
standards, Americans with Disability Act requirements, applicable zoning ordinances,
building codes and environmental laws. Aqua shall not occupy or use the DC Level 3
Electric Vehicle Charging Stations and License Area or permit any portion of the DC Level
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3 Electric Vehicle Charging Stations and License Area to be occupied or used for any use
or purpose that is unlawful in part or in whole, or deemed by City to be disreputable in
any manner or extra hazardous on account of fire.
30. CONFLICT OF INTEREST
Aqua or its employees may be subject to the provisions of the California Political
Reform Act of 1974 ("Act"), which (a) requires such persons to disclose any financial
interest that may foreseeably be materially affected by the work performed under this
Agreement, and (b) prohibits such persons from making, or participating in making,
decisions that will foreseeably financially affect such interest. If subject to the Act, Aqua
shall conform to all requirements of the Act. Failure to conform to the requirements of the
Act constitutes a material breach and is grounds for immediate termination of this
Agreement by City. Aqua shall indemnify and hold harmless City for any and all claims
for damages resulting from Aqua's violation of this Section.
31. NOT AGENT OF CITY
Nothing contained in this Agreement shall be deemed or construed to create the
relationship of principal and agent or of partnership or of joint venture or of any association
whatsoever between City and Aqua, it being expressly understood and agreed that
neither the computation of fees nor any other provisions contained in this Agreement nor
any act or acts of the Parties hereto shall be deemed to create any relationship between
City and Aqua other than the relationship of City and Aqua.
32. NO THIRD PARTY BENEFICIARIES
City and Aqua do not intend, by a provision of this Agreement, to create in any
third party, any benefit or right owed by one Party, under the terms and conditions of this
Agreement, to the other Party.
33. NOTICES
All notices and other communications required or permitted to be given under this
Agreement, including any notice of change of address, shall be in writing and given by
personal delivery, or deposited with the United States Postal Service, postage prepaid,
addressed to the Party intended to be notified. Notice shall be deemed given as of the
date of personal delivery, or if mailed, upon the date of deposit with the United States
Postal Service. Notice shall be given as follows:
To City: Harbor Department
City of Newport Beach
Attn: Harbormaster
P.O. Box 1768
100 Civic Center Drive
Newport Beach, CA 92660
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With a Copy to: City of Newport Beach
Attn: Real Property Administrator
100 Civic Center Drive, Bay 1 D
Newport Beach, CA 92660
To Aqua: Aqua Superpower (USA), Inc.
Attn: Scott Canning
1016 Farnam Street
Los Angeles, CA 90042
34. RESERVED.
35. FORCE MAJEURE; CHANGE IN LAW
Performance rendered pursuant to this Agreement shall be extended because of any
delays due to unforeseeable causes beyond the control and without the fault or negligence
of Aqua, including but not restricted to acts of God or of the public enemy, unusually severe
weather, fires, earthquakes, floods, epidemics, quarantine restrictions, riots, strikes, freight
embargoes, wars, and/or acts of any governmental agency, including the City, if Aqua, within
ten (10) days of the commencement of such delay, notifies City in writing of the cause of the
delay. City shall ascertain the facts and extent of delay, and extend the time for performing
the services for the period of the enforced delay when and if in the judgment of the City such
delay is justified. City's determination shall be final and conclusive upon the parties to this
Agreement. In no event shall Aqua be entitled to recover damages against City for any
delay in performance of this Agreement, however caused, Aqua's sole remedy being
extension of the Agreement pursuant to this Section. Further, if any rule, directive, order,
decision or law adversely impacts the ability for Aqua to perform its obligations under the
Agreement without becoming licensed or otherwise regulated by a public utility commission
or analogous agency in the relevant jurisdiction ("Adverse Directive"), Aqua may, at its
option, and within ten (10) business days of the commencement of such Adverse Directive,
notify City in writing of such Adverse Directive and request to either suspend performance
or terminate this Agreement. Within five (5) business days upon City's receipt of such notice,
City shall agree to either suspend Aqua's performance under this Agreement or terminate
this Agreement without penalty to either party if, in the reasonable judgment of the City, such
Adverse Directive exists.
36. TIME IS OF THE ESSENCE
Time is of the essence for this Agreement.
37. STANDARD PROVISIONS
37.1 Waiver. The waiver by either Party of any breach or violation of any term,
covenant or condition of this Agreement, or of any ordinance, law or regulation, shall not
be deemed to be a waiver of any other term, covenant, condition, ordinance, law or
regulation, or of any subsequent breach or violation of the same or other term, covenant,
condition, ordinance, law or regulation. The subsequent acceptance by either Party of
any fee, performance, or other consideration which may become due or owing under this
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Agreement, shall not be deemed to be a waiver of any preceding breach or violation by
the other Party of any term, condition, covenant of this Agreement or any applicable law,
ordinance or regulation.
37.2 Integrated Contract. This Agreement represents the full and complete
understanding of every kind or nature whatsoever between the Parties hereto, and all
preliminary negotiations and agreements of whatsoever kind or nature are merged herein.
No verbal agreement or implied covenant shall be held to vary the provisions herein. Each
Party has relied on advice from its own attorneys, and the warranties, representations,
and covenants of this Agreement itself. This Agreement shall inure to the benefit of and
be binding upon the Parties hereto and their respective successors and assigns.
37.3 Conflicts or Inconsistencies. In the event there are any conflicts or
inconsistencies between this Agreement and any other attachments attached hereto, the
terms of this Agreement shall govern.
37.4 Interpretation. The terms of this Agreement shall be construed in
accordance with the meaning of the language used and shall not be construed for or
against either Party by reason of the authorship of the Agreement or any other rule of
construction which might otherwise apply.
37.5 Amendments. This Agreement may be modified or amended only by a
written document executed by both Aqua and City and approved as to form by the City
Attorney.
37.6 Severability. If any term or portion of this Agreement is held to be invalid,
illegal, or otherwise unenforceable by a court of competent jurisdiction, the remaining
provisions of this Agreement shall continue in full force and effect.
37.7 Controlling Law and Venue. The laws of the State of California shall govern
this Agreement and all matters relating to it and any action brought relating to this
Agreement shall be adjudicated in a court of competent jurisdiction in the County of
Orange.
37.8 Equal Opportunity Employment. Aqua represents that it is an equal
opportunity employer and it shall not discriminate against any subcontractor, employee
or applicant for employment because of race, religion, color, national origin, handicap,
ancestry, sex or age.
37.9 No Attorney's Fees. In the event of any dispute or legal action arising under
this Agreement, the prevailing Party shall not be entitled to attorney's fees.
37.10 Counterparts. This Agreement may be executed in two (2) or more
counterparts, each of which shall be deemed an original and all of which together shall
constitute one (1) and the same instrument.
37.11 Exhibits. All exhibits attached to this Agreement are hereby
incorporated by reference herein.
Aqua Superpower (USA), Inc.
Page 20
9-25
38. POWERS TO ENTER INTO AGREEMENT
The individuals executing this Agreement represent and warrant that they have the
right, power, legal capacity and authority to enter into and to execute this Agreement on
behalf of the respective legal entities of the Aqua and the City.
[SIGNATURES NEXT PAGE]
Aqua Superpower (USA), Inc. Page 21
9-26
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed in duplicate on the dates indicated below.
APPROVED AS TO FORM: CITY OF NEWPORT BEACH,
CITY ATTORNEY'S OFFICE a California municipal corporation
Date: q/// 2 Date:
By: 7C By:
.pro, C. Ha c'-iT Grace K. Leung
Ci Attor y/iCity Manager
ATTEST: AQUA: AQUA SUPERPOWER (USA),
Date: INC., a Delaware corporation
Date:
By:
Leilani I. Brown
City Clerk
Alexander Bamberg
Chief Executive Officer
Date:
go
Andrew McLennan
Chief Financial Officer
[END OF SIGNATURES]
Attachments: Exhibit A:
License Area
Exhibit B:
Equipment Specifications
Exhibit C:
Aqua's Maintenance and Service Obligations
Exhibit D
Insurance Requirements
Aqua Superpower (USA), Inc. Page 22
9-27
EXHIBIT A
LICENSE AREA
Aqua Superpower (USA), Inc. Page A-1
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PNEWSN
City of Newport Beach
GIS 0iWsion
September 11, 2023
1.brM ,k_E1 v aNS—,.
9-29
tNf
EXHIBIT B
EQUIPMENT SPECIFICATIONS
Aqua Superpower (USA), Inc. Page B-1
9-31
0-
i1 C�IJ it _ 'I
• Marinised IP65 DC charger
+ Slim, compact, stylish
+ Liquid cooled
+ Aqua superPower certified
+ Latest safety standards
+ Durable, low maintenance
+ Increased reliability
+ Whisper quiet operation mode
+ Secure access via RFID /Aqua app
+ Plug & Charge
9-32
Aqua75 — 75kW
S P E C I F I C A T I O N S
s
•ARcmels cereurwey oplian avo 7o6fe
CONNECTORS
2 x CC51/220GA
CABLE LENGTH
6m+(cable management included)
OUTPUT POWER
Up to 75kW Up to 920V Up to 188A
SUPPLY INPUT
30 AC see overleaf for regional details
SUPPLY FREQUENCY
50 -- 60 Hz +/-10%
IP RATING
IP65
IK RATING
IK30 (Excluding Screen)
EFFICIENCY
95%
POWER FACTOR
>0.99
TOTAL HARMONIC DISTORTION
<5q THD
MAXIMUM OPERATING ALTITUDE
3000 m (6561')
OPERATING TEMPERATURE
-35'C to 40'C (-31'F to 104'F) sustained operation at full power
Rated for operation to 50'C (122'F) {de -rating applies)
STORAGE TEMPERATURE
-35'C to 70'C (-31'F to 158'F)
COMMUNICATION PROTOCOL
OCPP v1.6I
NETWORK CONNECTION
3G/4G/Ethernet for network
AUTHENTICATION METHOD
RFID: MI -FARE ISO/IEC14443A/B, ISO/IEC15693, ISO/IEC18000-3,
ISO 15118 (pre -registration required), FeIICa, NFC
CREDIT CARD READER
Optional Contact -less or 3-in-1 (region dependant)
ELECTRICAL PROTECTION
Over current, Over voltage, Under voltage, Short circuit, Surge protection,
Protective earth continuity monitor
DIMENSIONS
1999 x 950 x 309 mm (79' x 34' x 12')
WEIGHT
266kg with cable management (587lbs)
SHIPPING WEIGHT
Up to 320kg depending on configuration (704lbs)
ACCESSIBILITY
Meets US ADA, EN 301 549, DIN 18040 Height Requirements
OPTIONS
Simultaneous ready (dual EVSE)
• Eichrecht DE-M Certified DC Meter*
10' LCD display
Tilt Sensor upstream disconnect
Door Ingress Sensor upstream disconnect
Alternate 'Maggiore Green' colourway (subject to additional lead times/cost)
SAFETY COMPLIANCE*
WORLDWIDE: CE
USA: CTUVUS
EMC•
WORLDWIDE: EMC Directive
USA: FCC
*Pending certification completion
"A u /1
superpower
9-33
Aqua75 — 75KW
S P E C I F I C A T I O N S
AC GRID INTERFACE
ITEM
WORLDWIDE: (40OVA C/ 415VAC)75 KW USA: {480VAC) 75 KW
VOLTAGE
400VAC 3ph (no neutral) +/-10% 490VAC3ph (no neutral) +/-10%
FREQUENCY
50Hz +/- 10% 60Hz +/- 10%
NOMINAL CURRENT AT NOMINAL VOLTAGE
114A 95A
LEVEL
MAXIMUM CURRENTAT LOW LINE LEVEL
114A 105A
(NOMINAL VOLTAGE —10%) AND PF>0.99
OVER CURRENT PROTECTION DEVICE
125A breaker recommended 125A breaker recommended
REQUIRED (OCPD) IN SITE DISTRIBUTION
BOARD
(Required for supply cable protection) (Required for supply cable protection)
UNDER -VOLTAGE RELAY/SHUNTTRIP RELAY
The Aqua75 includes options for circuitry to locally isolate the charger's power circuit if the
IN SITE DISTRIBUTION BOARD (OPTIONAL)
safety loop monitor connected the door switches, tilt sensor, leak sensor or protective earth
continuity monitor is triggered.
Additionally, the charger can also include options to allow upstream isolations in the event of a
safety loop trigger event by including an under -voltage relay coil or shunt trip module on the
feeder cicuit breaker in the site distribution board.
Aqua chargers should only be installed by a licensed contractor and a licensed electrician, in
accordance with all local and national codes and standards. This may include additional, lockable
disconnect mechanisms within line of sight of the supplied equipment.
MINIMUM BURIED CABLE SIZE FOR AC
Single cores in buried duct: Single cores in buried duct -
SUPPLY
50mm2 Cu for L1,2,3 3AWG Cu for LI,2,3
(LENGTH OF AC CABLES AND SYSTEM
EFFICIENCY SHOULD BE CONSIDERED WHEN
25mm2 Cu for PE 4AWG Cu for PE
SIZING CABLES)
Multicare cable in buried duct: Multicore cable in buried duct:
50mm2 Cu 2AWG Cu
Mulricore cob;e direct buried:
35mm2 Cu
zoom 200m
MAXIMUM LENGTH OF BURIED CABLES FOR
MINIMUM AC LINK CABLE SIZE SPECIFIED
(To maintain feeder voltage drop below 396) (To maintain feeder voltage drop below 3%)
EUROPE - UK - USA
aqua-superpower.tom enquiries@aqua-superpcwer.com
UK +44 7733882 372 USA +1 323 497 3993 - Europe +39 333 785 3767
A GU A
superPower
9-34
EXHIBIT C
AQUA'S MAINTENANCE AND SERVICE OBLIGATIONS
Aqua's obligations to the City under this Agreement are as follows:
In respect of ECE installation and uptime:
■ Install, commission and render operational the first Charge Station within 12 months
of this agreement, unless agreed mutually or resulting from unexpected delays
■ Maintain the Charge Station annually.
■ Provide active fault monitoring to ensure uptime of the Charge Station
■ Arrange reactive maintenance where appropriate and as swiftly as reasonably
practicable (and assuming that there is no restriction on gaining access to the site
or equipment) in relation to charger faults:
■ Emergency situation — unstable charge station due to collision, damaged case
leading to exposure to internal mechanism of charger — Typically within 4 hrs
■ General faults — tripped RCD, loss of comms, damaged component, damaged
cable — Typically within 72 hours
■ Cosmetic damage — Typically with 15 working days
■ Fatal error leading to swap out - Typically within 72 hrs. to diagnose. Best
efforts to swap charger out within 15 business days of the diagnosis of
the fault.
2. In respect of User experience
■ Provide customer care to users of the Charge Station during reasonable and normal
business hours
■ Provide a physical sign on the ECE unit containing a contact phone number that
users shall utilize for emergency assistance and technical support.
■ Update the map with the live status of all Charge Stations
■ Provide ongoing compatibility testing as new watercraft enter the marketplace
ensuring the widest usage of the Charge Station
■ Operate a payment service to the end customer
3. In respect of City needs and in accordance with the Agreement, Aqua shall;
■ Provide City with access to an online dashboard providing Management Information
■ Pay the site license fee annually (in advance)
■ To notify the host of any faults and keep them updated on a regular basis
■ Abide by the terms of the Agreement.
Aqua Superpower (USA), Inc. Page C-1
9-35
EXHIBIT D
INSURANCE REQUIREMENTS
Provision of Insurance. Without limiting Aqua's indemnification of City, and prior
to commencement of work, Aqua shall obtain, provide and maintain at its own
expense during the term of this Agreement, policies of insurance of the type and
amounts described below and in a form satisfactory to City. Aqua agrees to
provide insurance in accordance with requirements set forth here.
2. Acceptable Insurers. All insurance policies shall be issued by an insurance
company currently authorized by the Insurance Commissioner to transact
business of insurance in the State of California, with an assigned policyholders'
Rating of A- (or higher) and Financial Size Category Class VII (or larger) in
accordance with the latest edition of Best's Key Rating Guide, unless otherwise
approved by the City's Risk Manager.
3. Coverage Requirements.
A. Workers' Compensation Insurance. Aqua shall maintain Workers'
Compensation Insurance, statutory limits, and Employer's Liability
Insurance with limits of at least one million dollars ($1,000,000) each
accident for bodily injury by accident and each employee for bodily injury by
disease in accordance with the laws of the State of California, Section 3700
of the Labor Code.
Aqua shall submit to City, along with the certificate of insurance, a Waiver
of Subrogation endorsement in favor of City, its City Council, boards and
commissions, officers, agents, volunteers and employees.
C. General Liability Insurance. Aqua shall maintain commercial general
liability insurance, and if necessary umbrella liability insurance, with
coverage at least as broad as provided by Insurance Services Office form
CG 00 01, in an amount not less than one million dollars ($1,000,000) per
occurrence, two million dollars ($2,000,000) general aggregate. The policy
shall cover liability arising from premises, operations, personal and
advertising injury, and liability assumed under an insured contract (including
the tort liability of another assumed in a business contract) with no
endorsement or modification limiting the scope of coverage for liability
assumed under a contract.
D. Automobile Liability Insurance. Aqua shall maintain automobile insurance
at least as broad as Insurance Services Office form CA 00 01 covering
bodily injury and property damage for all activities of Aqua arising out of or
in connection with work to be performed under this Agreement, including
coverage for any owned, hired, non -owned or rented vehicles, in an amount
not less than one million dollars ($1,000,000) combined single limit each
accident.
Aqua Superpower (USA), Inc. Page D-1
9-36
4. Worker's Compensation Insurance Requirements. The policies are to contain, or
be endorsed to contain, the following provisions:
A. Waiver of Subrogation. All insurance coverage maintained or procured
pursuant to this Agreement shall be endorsed to waive subrogation against
City, its City Council, boards and commissions, officers, agents, volunteers
and employees, or shall specifically allow Aqua or others providing
insurance evidence in compliance with these requirements to waive their
right of recovery prior to a loss. Aqua hereby waives its own right of recovery
against City, and shall require similar written express waivers from each of
its subcontractors.
B. Additional Insured Status. All liability policies including general liability,
excess liability and automobile liability, if required, but not including
professional liability, shall provide or be endorsed to provide that City, its
City Council, boards and commissions, officers, agents, volunteers and
employees shall be included as an additional insured under such policies.
C. Primary and Non Contributory. All liability coverage shall apply on a primary
basis and shall not require contribution from any insurance or self-insurance
maintained by City.
FBI
Notice of Cancellation. All policies shall provide City with thirty (30)
calendar days' notice of cancellation or nonrenewal of coverage for each
required coverage.
5. Additional Agreements Between the Parties. The parties hereby agree to the
following:
A. Evidence of Insurance. Aqua shall provide certificates of insurance to City
as evidence of the insurance coverage required herein, along with a waiver
of subrogation endorsement for workers' compensation and other
endorsements as specified herein for each coverage. Insurance certificates
and endorsement must be approved by City's Risk Manager prior to
commencement of performance. Current certification of insurance shall be
kept on file with City at all times during the term of this Agreement.
B. City's Right to Revise Requirements. City reserves the right at any time
during the term of the Agreement to change the amounts and types of
insurance required by giving Aqua sixty (60) calendar days advance written
notice of such change; provided, however, Aqua, shall not be obligated to
conform to such changes if doing so would result in a material increase in
cost of Aqua's insurance.
C. Enforcement of Agreement Provisions. Aqua acknowledges and agrees
that any actual or alleged failure on the part of City to inform Aqua of non-
compliance with any requirement imposes no additional obligations on City
nor does it waive any rights hereunder.
Aqua Superpower (USA), Inc. Page D-2
9-37
D. Requirements not Limiting. Requirements of specific coverage features or
limits contained in this Section are not intended as a limitation on coverage,
limits or other requirements, or a waiver of any coverage normally provided
by any insurance. Specific reference to a given coverage feature is for
purposes of clarification only as it pertains to a given issue and is not
intended by any party or insured to be all inclusive, or to the exclusion of
other coverage, or a waiver of any type.
E. Self -insured Retentions. Any self -insured retentions must be declared to
and approved by City. City reserves the right to require that self -insured
retentions be eliminated, lowered, or replaced by a deductible. Self-
insurance will not be considered to comply with these requirements unless
approved by City.
F. City Remedies for Non -Compliance. If Aqua or any subcontractor fails to
provide and maintain insurance as required herein and such failure
continues uncured for ten (10) business days after receipt of written notice,
then City shall have the right but not the obligation, to terminate this
Agreement or to suspend Aqua's right to proceed until proper evidence of
insurance is provided.
G. Timely Notice of Claims. Aqua shall use best efforts to give City prompt and
timely notice of claims made or suits instituted that arise out of or result from
Aqua's performance under this Agreement, and that involve or may involve
coverage under any of the required liability policies. City assumes no
obligation or liability by such notice, but has the right (but not the duty) to
monitor the handling of any such claim or claims if they are likely to involve
City.
H. Aqua's Insurance. Aqua shall also procure and maintain, at its own cost
and expense, any additional kinds of insurance, which in its own judgment
may be necessary for its proper protection and prosecution of the work.
Aqua Superpower (USA), Inc. Page D-3
Attachment B
Map
9-39
9-40
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SDisclaimer:
N E W P O R T B E A C H Every reasonable effort has been made to assure the
accuracy of the data provided, however, The City of
Newport Beach and its employees and agents
o� 0 200 400 disclaim any and all responsibility from or relating to
any results obtained in its use.
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Marina Park - Charging Station NBGIS
N E W PORT BEACH
Electric Marine Vessel Charge Point City of Newport Beach
GIS Division
O September 07, 2023
Electric Vessel Charger MarinoPark_Elen icVesselSmtion.oprx 9-42
DISCLAIMER NOTICE: By accessing Me tlota ets/maps c ntalnetl i, or a .-d to Mix email, you agree ro be bo- by Me Ciy of Newport B—h's TERMS OF USE, wbicF zM1ould be reviewed in i,s emirary.
Please nose: The datautz/maps, and oLy related materials wntalned Merein, may comain nonconformidez, defects, oLd/or errors They are being provided "as is" witF:om warranty of airy Rind, eiMer express or Implied. BY ACCESSING THESE DATASETS/MAPS, YOU ASSUME ALL RISK AND RESPONSIBILITY THAT MAY ARISE FROM OR IN MANNER RELATE TO YOUR USE
AND REPRODUCTION THEREOF AND AGREE TO COMPLY WITH ALL APPLICABLE LAWS AND INDUSTRY STANDARDS
Attachment C
City Council Policy F-7, Income and Other Property
9-43
F- 7
INCOME AND OTHER PROPERTY
The City owns and manages an extensive and valuable assortment of property including streets, parks,
beaches, public buildings and service facilities. The City also owns or ground leases and/or operates a yacht
basin, resort hotel and apartment property, a luxury residential development and various other income -
producing properties. Much of the income property is tidelands, filled tidelands or waterfront.
Unencumbered fee value of income property is substantial.
As owner/manager of property, the City is the steward of a public trust, and state law requires the City to
maximize its returns on state -managed property or be subject to a charge of making a gift of public funds.
Nevertheless, the City Council recognizes the importance of this property not only as a revenue generator,
but also as a means to provide otherwise financially less feasible uses and facilities that benefit the
community.
In managing its property, the City will continually evaluate the potential of all City owned property to
produce revenue. This may include leasing or licensing unused land, renting vacant space, and establishing
concessions in recreation areas or other similar techniques. The City Council will evaluate the
appropriateness of establishing new income generating opportunities on City controlled areas using sound
business principles and after receiving input from neighbors, users and the public.
The policy of the City Council is that income and other property be held and managed in accordance with
the following:
A. Whenever a lease, license, management contract, concession or similar action regarding income
property is considered by the City, an analysis shall be conducted to determine the maximum or
open market value of the property. This analysis shall be conducted using appraisals or other
techniques to determine the highest and best use of the property and the highest income generating
use of the property.
B. All negotiations regarding the lease, license, management contract, concession, or similar action
regarding income property shall include review of an appraisal or analysis of the use being
considered for the property conducted by a reputable and independent professional appraiser, real
estate consultant, or business consultant.
C. The City shall seek, whenever practical and financially advantageous, both in the short and long
term, to operate or manage all property and facilities directly with City staff or contractors, provided
staff have the expertise needed to competently do so, or to oversee the work of contractors.
D. In most negotiations regarding the lease, license, management contract, concession, or similar action
regarding an income or other property, the City shall seek revenue equivalent to the open market
value of the highest and best use; and, whenever practicable the City shall conduct an open bid or
proposal process to ensure the highest financial return.
1 9-44
F- 7
E. However, in some circumstances the City may determine that use of a property by the public for
recreational, charitable or other nonprofit purpose is preferred and has considerable public support,
in which case the City may determine that non -financial benefits justify not maximizing revenue
from such property. In such circumstances, the City has a vested interest in ensuring that the lessee
of such property operates the activities conducted on or from the property in the manner that has
been represented to the City throughout the duration of any lease or contract with the City.
F. Whenever less than the open market or appraised value is received or when an open bid process is
not conducted, the City shall make specific findings setting forth the reasons thereof. Such findings
may include but need not be limited to the following:
The City is prevented by tideland grants, Coastal Commission guidelines or other restrictions
from converting the property to another use.
2. Redevelopment of the property would require excessive time, resources, expertise and costs,
which would outweigh other financial benefits.
3. Converting the property to another use or changing the operator, manager, concessionaire,
licensee, or lessee of the property would result in excessive vacancy, relocation or severance
costs, real estate commissions, tenant improvement allowances, expenses or rent
concessions which would outweigh other financial benefits.
4. Converting residential property to another use or opening residential leases to competitive
bid would create recompensable liabilities and other inequities for long-term residents.
5. The property provides an essential or unique service to the community or a clearly preferred
use that enjoys substantial support in the community that might not otherwise be provided
were full market value of the property be required.
6. The property serves to promote other goals of the City such as affordable housing,
preservation of open space, uses available to the public or marine related services.
G. Generally, lengths of licenses, leases, management contracts, concessions, or similar agreements
will be limited to the minimum necessary to meet market standards or encourage high quality
improvements and will contain appropriate reappraisal and inflation protection provisions. Also, all
agreements shall contain provisions to assure complete audits periodically through their terms.
H. All negotiations regarding the license, lease, management contract, concession or similar action
regarding income property shall be conducted by the City Manager or his/her designee under the
direction of any appropriate City committees.
I. To provide an accurate accounting of actual net revenues generated by the City's income property,
all costs directly attributable or allocable to the management of a specific income property shall be
charged against the gross revenues collected on that property in the fiscal year the costs are incurred.
Costs so chargeable include, but are not limited to, property repairs and maintenance, property
appraisals, and consultant fees, as authorized by the City Council, City Manager, or by this Income
Property Policy.
9-45
F- 7
J. The City Manager or his/her designee is authorized to sign a license, lease, management contract,
concession, or similar agreement or any amendment thereto, on behalf of the City. Notwithstanding
the foregoing, the City Manager or his/her designee, or a City Council member, may refer any
license, lease, management contract, concession or similar agreement or any amendment thereto, to
the City Council for its consideration and/or action.
K. The City's portfolio of quality income producing properties adds an element of diversification to a
portfolio otherwise invested primarily in financial assets. Certain of those income properties are
restricted from sale by their terms of grant, state agency regulations or rules, other federal and state
guidelines, private covenant or agreement or otherwise. For those properties not so restricted from
sale, an analysis shall be prepared to determine the following prior to such income producing
property being offered for sale:
1. The maximum open market value of the City's interest in the property in its as is condition.
2. If the property is in an important location, a determination of the possible future
consequences of the City no longer controlling that property.
3. If the current rent is contractually low and significant rent increases are likely within a finite
period.
4. The likelihood of significant increases in the ability of the property to generate income after
the expiration of any current lease of the property.
5. The likelihood of a lease extension being requested by the tenant and the ability to
substantially increase rents or require significant improvements to enhance the utility and
the value of the property as consideration for granting such an extension.
6. The value of the revenue stream from (i) lease income over the life of an existing lease and/or
(ii) likely lease revenue if an existing lease were to be renewed or the property re -let to a
different tenant; and/or (iii) lease income from the property if it were to be converted to its
highest and best use, compared with the financial benefits of the use of the proceeds of a sale
and if, considering the totality of the circumstances, such use of the proceeds of a sale is
preferable to retaining the property in question.
History
Adopted F-24 —
7-27-1992
Amended F-24
— 1-24-1994
Amended F-7 —
2-27-1995
Amended F-7 —
2-24-1997
Amended F-7 —
5-26-1998
Amended F-7 —
8-11-2009
Amended F-7 —
5-14-2013
Amended F-7 —
2-12-2019
Amended F-7 —
11-14-2023
3 9-46