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HomeMy WebLinkAboutC-2263 - Joint Powers Agreement, Construction of Tideland/Oil0 JOINT POWERS AGREEMENT FOR ACQUISITION AND CONSTRUCTION OF TIDELANDS OIL PUMPING AND STORAGE FACILITIES 4CEIVED tp CLERK OCT 191981m-- ( - NEWPORT OF CAUE MW nom: THIS AGREEMENT, made and entered into this X day of the State of California duly organized and existing pursuant to Public Resources Code section 6100, et seq. (hereinafter referred to as the "Commission "), both of whom understand and agree as follows: WHEREAS, pursuant to Chapter 74 of the Statutes of 1978, the City holds in trust for the benefit of the People of the State of California all of that` real property con- sisting of, and mineral rights within, that portion of tide- lands and submerged lands, whether filled or unfilled, bor- dering upon and under the Pacific Ocean or Newport Bay in the County of Orange, which were within the corporate limits of the City. of Newport Beach, a, municipal corporation, on July 25, 1919 (hereinafter referred to as the "public trust area "); and Yiii� is +S, under the aforementioned public trust grant, the Co ::mission, on behalf of the People of the State of California, holds both a reversionary ownership interest in the public truct area and the minerals therein, and a pre- EXKIBIT "A" 1981, by and between the CITY OF NEWPORT BEACH, a chartered municipal corporation (hereinafter referred to as the "City "), and the STATE LANDS COMMISSION, an agency of the State of California duly organized and existing pursuant to Public Resources Code section 6100, et seq. (hereinafter referred to as the "Commission "), both of whom understand and agree as follows: WHEREAS, pursuant to Chapter 74 of the Statutes of 1978, the City holds in trust for the benefit of the People of the State of California all of that` real property con- sisting of, and mineral rights within, that portion of tide- lands and submerged lands, whether filled or unfilled, bor- dering upon and under the Pacific Ocean or Newport Bay in the County of Orange, which were within the corporate limits of the City. of Newport Beach, a, municipal corporation, on July 25, 1919 (hereinafter referred to as the "public trust area "); and Yiii� is +S, under the aforementioned public trust grant, the Co ::mission, on behalf of the People of the State of California, holds both a reversionary ownership interest in the public truct area and the minerals therein, and a pre- EXKIBIT "A" 0 0 sent proprietary interest in the proceeds derived from the public trust area; and WHEREAS, the State of California, by and through the Commission, has a strong interest in ensuring that oil, gas and other hydrocarbon substances be produced from the public trust area so as to reduce this Nation's dependence upon i imported oil products; and WHEREAS, the City and Commission desire to permit the City to produce from the public trust area oil, gas and other hydrocarbon substances, the revenues from which will be utilized to operate, maintain and improve harbors and beaches within the City for the benefit of the residents of the City and the People of the State of California; and WCSREAS, the Commission is authorized pursuant to Sec - tion 6808 of the Public Resources Code to acquire in the name of the State any right of way or easement, including surface rights, that may be necessary for the develop;nent and production of oil and gas from lands to which the State of California has an ownership interest, if the Commission deems such action to be in the best interests of the State of California; and KSEREAS, the City and Commission agree that it is in the b.•s_ interests of the City and the State of California to acq_ire the rights in the property described in Exhibit "A" atta,:hcd hereto and by this reference incorporated herein, wi•ich rights and property are necessary for the -2- E 0 development and ;roduction of oil and gas from the public trust area which is held in trust by the City and in which the State of California has a reversionary property inter- . est and a present proprietary interest; and WHEREAS, this Agreement is authorized by Title I, Divi- sion 7, Chapter 5 of the Government Code, which authorizes the joint exercise by agreement of two public agencies of any powers common to them, and by Section 1240.140 of the Code of Civil Procedure, which authorizes two or more public agencies to enter into an agreement for the joint exercise by their respective powers of eminent domain. NOW, THEREFORE, the City and Commission, for and in consideration of the mutual promises and agreements here- inafter stated, and the performance thereof, and for other valuable -and adequate compensation, do hereby agree for and on behalf of themselves and their successors in interest as follows: 1. This Agreement is for the purpose of authorizing performance by the City of all of the functions of the City and Co^:.iission, except those services which are now or may hereafter be made the subject of separate and special agree- ments between the parties hereto. The purposes of this Agreem_nt shall be accomplished in the manner hereinafter set fort`.:. 2. The City is designated as the Joint Powers Agency under thiz- Joint Powers Agreement, and as such, is desig- -3- 0 9 nated as the party to administer this Agreement by and through its officers, employees, departments and designees for the purpose of acquiring and constructing surface oil drilling, production, storage and transportation facilities .,for the production of oil, gas and other hydrocarbon sub- stances from wells slant - drilled into the public trust area. The real property to be acquired is situated in the County of Orange, State of California, and is more particularly de- scribed in Exhibit "A" attached hereto and by this reference made a part hereof as though set forth at length. A plat showing the boundaries of the real property to be acquired is attached hereto as Exhibit "B." 3. In order to acquire and operate the hereinabove described surface facilities for the drilling for, produc- tion, storage and transportation of oil, gas and other hy- drocarbon substances from the public trust area, the City, as the Joint Powers Agency, shall exercise all necessary powers of City and Commission to .accomplish such acquisi- tion, construction and operation. In this regard, Commis- sion specifically agrees that the City is authorized to con- duct all legal proceedings to acquire interests in real and personal property necessary for the surface drilling, pro - ductio:, storage and transportation of oil, gas and other hydrocar't-on substances from tIhe public trust area, includ- ing, Cut rot limited to, the desi:lration of the City Attor- ney or v_har legal counsel to conduct necessary eminent -4- 0 0 domain proceedings in the name of the City or Commis�;ion, as appropriate. The Commission further agrees that it will do all things necessary to facilitate the conducting of said proceedings, including, but not limited to, the expeditious consideration of approval of resolutions of necessity, and the endorsement of all necessary legal documents as reques- ted by the above - designated legal representative in this matter. 4. In order that the Commission may at all times be fully apprised of the actions of the City as the Joint Pourers agency under this Agreement, a copy of each pleading filed, served or received by the City pertaining to the acquisition which is the subject of this Agreement shall be transmitted to and received by the legal counsel for the Commission within forty -eight (48) hours of filing, service or receipt by the City. If, due to time constraints outside of the control of the City, the City is unable to transmit such pleadings to the legal counsel of the Commission within the above- described time period; legal counsel for the City shall communicate with the legal counsel for the Commission by telephone and inform the Commission's legal counsel of the con:.2nts of such pleadings. The legal counsel to Com- mission further shall be permitted to be present at all hea:in_s and discovery proceedings which may occur as a re- suit of legal proceedings brought pursuant to this Agreement. 5. Tne City shall act as the lead agency for the pre- -5- paration and processing of any and all environmental docu- ments that may be required in connection with the admini- stration of this Agreement. 6. The City shall bear the entire cost of administer- ••ing this Agreement, including, but not limited to, all costs relating to the acquisition, construction and operation of the surface facilities for the drilling for, production, storage and transportation of oil, gas and other hydrocarbon substances from the trust area as hereinabeve set forth, and also including, but not limited to, the costs of conducting eminent domain proceedings hereunder. 7. The City's Treasurer shall serve as Treasurer for the purpose of administering this Agreement, and shall be bonded as required by law, and all receipts and disburse- ments pursuant to the administration of this Agreement shall be strictly accounted for by City in accordance with appli- cable laws. Any and all surplus funds at the termination of this Agreement shall remain with the City. All funds held pursuant to this Agreement shall be in the control of and accounted for by the City. 8. Both parties agree that they and their officers, employees and agents shall cooperate in carrying out this Agreement. 9. The Commission shall assume no liability for any costs i ^curred in the administration of this Agreement by the City, nor shall the Commission assume any liability for -6- 0 0 the negligence of any officer or employee of the City, and the City shall hold the Commission and its officers and employees harmless from and shall defend the Commission and its officers and employees against any claim for damages resulting therefrom. The City shall protect and hold the Commission, its officers and employees, harmless from all claims, damages and costs, and assume the defense of all actions for any damages or injuries alleged to have arisen out of the acts of the City, its officers or employees, undertaken pursuant to this Agreement. 10. Upon completion of the acquisition of the surface facilities for the drilling for, production, storage and transportation of oil, gas and other hydrocarbon substances from the public trust area hereunder, all interests in real and personal property acquired hereunder shall remain in the name of the Joint Powers Agency; provided, however, that within one hundred twenty (120) days of title to such prop- erty and property interests vesting in the Joint Powers Agency, the,Joint Powers Agency shall convey title to the City, as the Joint Powers Agency then may have to such real and personal property or property interests. 11. Unless extended by agreement of the parties, and ercep: fer Parayraph 1.0 hereof, this Agreement shall termi- nate and be of no further force and effect when the acquisi- tion .._ construction of the herein described surface facil- ities f_-r the drilling for, production, storage and trans- -7- portation of trust area oil, gas and other hydrocarbon sub- stances is completed and all other terms hereof complied with. Paragraph 10 shall remain in full force and effect until the property and property interests described in Exhi- bit "A" hereto are conveyed to the City, unless terminated by mutual agraement of the parties. IN WITNESS WHEREOF, the parties to this Agreement have caused their na;nes to be affixed hereto by the proper offi- cers thereof. This Agreement is signed and executed this a day of N ALl , 1981. THE CITY OF NEWPORT BEACH THE STATE LANDS COMMISSION a chartered municipal OF THE SPATE OF.CAr!FORNIA corporation / By By �L' L CaiJ.. �•T�— -Mayor ATTEST: ATTEST: SIGNED AND CERTIFIED THAT A i• 4 COPY- OF THIS DOCU:SENT HAS BEEN By B -- DELIVERED TO THE CHAIRMAN OF - - �- ' City Clerks ; THE STATE: LANDS COMMISSION 2� — Secretary to the Stye Lands Commission APPROVED AS TO FORM: APPROVED AS TO FOR ?1: City Alzocney ' ise �Lirds Commission / -3- April 20, 1981 0 0 CITY OF NEWPORT BEACH OFFICE OF THE CITY CLERK (714) 640 -2251 Rutan & Tucker Attorneys at Law Wells Fargo Bank 401 Civic Center Drive West P.O. Box 1976 Santa Ana, California 92702 Attention: Joel D. Kuperberg Please find enclosed the original and one copy of the JOINT POWERS AGREEMENT FOR ACQUISITION AND CONSTRUCTION OF TIDELANDS OIL PUMPING AND STORAGE FACILITIES which was approved by the City Council on April 13, 1981. Following execution by the State Lands Commission please have one copy forwarded to this office for our records. Respectfully, WANDA E, ANDERSEN City Clerk Enclosure (2) Cite Ilall • :3;300 Newport BouleNard, Neicport Beach, California 92663 0 0 ­ Hugh Coffin City Attorney City of Newport Beach 3300 Newport Boulevard Newport Beach, California 92663 Re: Armstrong vs. City of Newport Beach (Joint Powers Agreement) Dear Hugh: TW% 910 5961083 CABLE ADDRESS RUTAN TUC NEWPORT BEACH OFFICE 610 NEWPORT CENTER DRIVE. SUITE 900 POST OFFICE BOX 1369 NEWPORT BEACH, CALIFORNIA 92660 TELECOPIER 11191 759-8993 TELEPHONE 17141 759-0833 IN RCPLY PLEASE REFER TO Please find enclosed the original Joint Powers Agree- ment for execution subsequent to the City Council meeting of April 14, 1981. The language regarding "terminable at will" has been deleted per agreement with the State Lands Commission. I will be meeting this week with Harley Pinson to hammer out a separate and confidential letter agreement permitting the State Lands Commission to have a limited say in the City's legal arguments utilizing Public Resources Code 96808. If you have any questions, please feel free to call. V ry truly yours, TAN TUCKER oel Kuperberg JDK:bc Enclosure RUTAN & TUCKER ATTORNEYS AT L,AW .RVTPN IIBBO -IB 721 A PARTNERSHIP CONSISTING OF PROFESSIONAL CORPORATIONS 1UCKER, SR. IIBBBIB 501 ."FOR. W DAHL• oOLVH Z. SHEPP RO' WELLS FARGO BANK BUILDING ROO GER H WELL' O EVE. WOLCOTT. mE5 B TU CAER• ROBERTL 401 CIVIC CENTER DRIVE WEST GARVIN F. SHALLFI.ERGER' P RTON NEWMAN �AJMIE R MOORS' CE E. BERn NO• POST OFFICE BOX 1976 ROBERT 1, R15LEY• .BERT 5. BOWER DM ER L. MCCORMIC1, 1R. ARCIA A ORSYTH SANTA ANA, CALIFORNIA 92702 WILLIAM A, 91E L' TICORENA ICHARO A. CUBNOTT• LAWRENCE J OREYFUSS TELECOPIER D14) 556 -1566 LEON ARD A MPCL• NE NELSON L A JOHN B. H 0 RLBUT, JR.' PATRICIA L. STEARNS nDCHA[L w IMELL• RENA G BTONC TELEPHONE (7141 635 -2200 LFORD w o AN AM THEODORE WALLACE. JR. GARY RICHARD P. 51M5•L ANDALLL S,, WAIER MARSHALL M. PEARLMAN— OIANC L DOUGLAS ROBERT C. B PHILIP D. N ROGER A, GRABLl' EDWARD D.SYBE$MA,JR.' JOEL D, R.RFRBERG ELIZABETH A.NEALE April 7, 1981 THOMAS S. SALINGER• SCOTT R. HOYi BARRY R USSCHER' MARY B. MCILLECC DAVID C LARSEN• KATHRYN CLIEFOROE, PHILIP C. MAYNARD ARTHUR G.K N NEILA R, BEHISTCIN Mi CHAE1 D RUB N• DONNA SNOW WOLF ABC WINTHROP' DODRA J, DUNN-PETERSON P G.R EVRIDIAt IVICKII DALLAS JEFFREY MNOOEINAN• ­ Hugh Coffin City Attorney City of Newport Beach 3300 Newport Boulevard Newport Beach, California 92663 Re: Armstrong vs. City of Newport Beach (Joint Powers Agreement) Dear Hugh: TW% 910 5961083 CABLE ADDRESS RUTAN TUC NEWPORT BEACH OFFICE 610 NEWPORT CENTER DRIVE. SUITE 900 POST OFFICE BOX 1369 NEWPORT BEACH, CALIFORNIA 92660 TELECOPIER 11191 759-8993 TELEPHONE 17141 759-0833 IN RCPLY PLEASE REFER TO Please find enclosed the original Joint Powers Agree- ment for execution subsequent to the City Council meeting of April 14, 1981. The language regarding "terminable at will" has been deleted per agreement with the State Lands Commission. I will be meeting this week with Harley Pinson to hammer out a separate and confidential letter agreement permitting the State Lands Commission to have a limited say in the City's legal arguments utilizing Public Resources Code 96808. If you have any questions, please feel free to call. V ry truly yours, TAN TUCKER oel Kuperberg JDK:bc Enclosure i 0 RESOLUTION NO. 10022 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE A JOINT POWERS AGREEMENT BETWEEN THE CITY OF NEWPORT BEACH AND THE STATE LANDS COMMISSION FOR THE ACQUISITION AND CONSTRUCTION OF TIDELANDS OIL PUMPING AND STORAGE FACILITIES WHEREAS, the City holds in trust for the benefit of the people of the State of California certain real property consisting of, and mineral rights within, tidelands and submerged lands, whether filled or unfilled bordering upon and under the Pacific Ocean and Newport Bay in the County of Orange, which were within the corporate limits of the City of Newport Beach on July 25, 1919; and WHEREAS, oil, gas and other hydrocarbon substances have been produced from the area held in trust by the City in the west Newport area for many years; and WHEREAS, said oil, gas and other hydrocarbon substances production commenced under an operating agreement entered into between the City of Newport Beach and D. W. Elliott on November 1, 1943, which agreement was amended on January 31, 1955, and again on October 30, 1968; and WHEREAS, said operating agreement provided that on January 25, 1981, the operator was to assign to the City certain real property interests, above surface equipment interests, and sub - surface equipment interests; and WHEREAS, the operator failed, refused and continues to refuse to make such assignments and transfers; and 1 • • WHEREAS, the City of Newport Beach and the State of California, by and through the State Lands Commission, has a strong interest in ensuring that oil, gas and other hydrocarbon substances be produced from the tidelands trust area so as to reduce this Nation's dependence upon imported oil products; and WHEREAS, the City and the State Lands Commission desire to permit the City to produce, from the tidelands trust area, oil, gas and other hydrocarbon substances, the revenues from which will be utilized to operate, maintain and improve harbors and beaches within the City for the benefit of the residents of the City of Newport Beach and the people of the State of California; and WHEREAS, it is in the best interests of the City and the State of California to acquire certain rights in real and personal property in the west Newport area from the operator of the west Newport oil fields, which rights and property are necessary for the development and production of oil, gas and other hydrocarbon substances from the tidelands trust areas which are held in trust by the City; and WHEREAS, it is appropriate and in the best interest of the City of Newport Beach to enter into a Joint Powers Agreement with the State Lands Commission for the acquisition and construction of tidelands oil pumping and storage facilities to facilitate the acquisition of said facilities and rights pursuant to said Agreement; and WHEREAS, the City Council of the City of Newport Beach has reviewed the terms and conditions of said Joint Powers Agreement and finds them to be fair, just and equitable 2 I NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Newport Beach that the Joint Powers Agreement for acquisition and construction of tidelands oil pumping and storage facilities beween the City of Newport Beach and State Lands Commission be and is hereby approved. BE IT FURTHER RESOLVED that the Mayor and City Clerk are hereby authorized to execute said Agreement on behalf of the City of Newport Beach., ATTEST: City Clerk ADOPTED this 13th day of April , 1981. Lc/ (/Sa r 3 041381 HRC /pr April 13, 19810RIGINAL CITY COUNCIL AGENDA ITEM NO. /-_- ,Q- CX) TO: CITY COUNCIL FROM: Utilities 0-Iff , 1 4 u. SUBJECT: WEST NEWPORT OIL I4ELLS JOINT POWERS AGREEMENT RECOMMENDATION: Adopt a Resolution authorizing a Joint Powers Agreement with the State Lands Commission for acquisition and construction of tidelands oil oumoina and storage facilities. Authorize the Mayor and City Clerk to execute the required docu- ments to accomplish the above recommendation. DISCUSSION: The City originally approached the State Lands Commission to cooperate with the City in the condemnation of surface and other easement rights in an area outside of the City limits of Newport Beach for the production of oil and gas from the City tidelands. At that time the State concluded it was unable to act and the City subsequently adopted a condemnation resolution to proceed on its own. To date the City has not filed its condemnation action pending the outcome of the annexation proceeding recently concluded. Meanwhile, the State Lands Commission at its meeting on March 5, 1981 held a hearing at which all interested parties were given notice to consider cooperating with the City in its condemnation action. Armstrong Petroleum Corporation appeared through Robert Armstrong and his counsel. Representatives of the City also appeared and testified. At the meeting the commission among other matters determined to authorize the staff of the commission, the Office of the Attorney General, and the City of Newport Beach as trustee for the State, to take such steps as may be necessary to acquire the property rights necessary to produce the City tidelands oil and gas, including litigation and condemnation. Because of this determination the City can, pursuant to agree- ments between the City and State, call on the full power of the State of California to assist it in its goal to resolve the present controversy with Armstrong. It is now recommended that the City enter into a Joint Powers Agreement with the State Lands Commission for the acquisition and construction of tidelands oil pumping and storage facilities. The proposed Joint Powers Agreement would contain the following provisions: 1. City would be designated as the party to administer the agreement. 2. City would be authorized to conduct all legal proceedings includ- ing condemnation actions to acquire interests in real and personal property required for oil production purposes. * • April 13, 1981 West Newport Oil Wells Page 2 3. City would act as the lead agency for all required environmental documents. 4. City would bear the cost of administering the agreement and all costs relating to acquisition, construction, and operation. 5. City's Treasurer would serve as Treasurer for the purpose of administering the agreement. 6. State would assume no liability for costs. 7. Upon completion of the acquisition the title to property acquired would remain with the commission provided that the State would upon written request by the City convey title to the City. 8. The agreement would terminate when the acquisition and construction are completed. A draft of the proposed agreement is attached for Council members only. The final form of the agreement would be subject to review as to form by both the City Attorney and the State Lands Commission. E.JZd�•G/ /Jo)seT. Devlin es Director JTD:bc Attachment ., RESOLUTION MO.� By ilia v,i'f COUrdti.,L CITY QFW:MM=T OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE A JOINT POWERS AGREEMENT BETWEEN THE CITY OF NEWPORT BEACH AND THE STATE LANDS COMMISSION FOR THE ACQUISITION AND CONSTRUCTION OF TIDELANDS.OIL PUMPING AND STORAGE FACILITIES Zi F WHEREAS, the City holds in trust for the benefit of the people of the State of California certain real property consisting of, and mineral rights within, tidelands and submerged lands, whether filled or unfilled bordering upon and under the Pacific Ocean and Newport Bay in the County of Orange, which were within the corporate limits of the City of Newport Beach on July 25, 1919; and WHEREAS, oil, gas and.other.hydrocarbon substances have been produced from the area held in trust by the City in the west Newport area for many years; and WHEREAS, said oil, gas and other hydrocarbon substances production commenced under an operating agreement entered into between the City of Newport Beach and D. W. Elliott on November 1, 1943, which agreement was amended on January 31, 1955, and again on October 30, 1968; and WHEREAS, said operating agreement provided that on January 25, 1981, the operator was to assign to the City certain real property interests, above surface equipment interests, and sub - surface equipment interests; and WHEREAS, the operator failed, refused and continues to refuse to make such assignments and transfers; and 1 WHEREAS,.the City of Newport Beach. and the State of California, by and through the State Lands Commission, has a strong interest in ensuring that oil, -gas and other hydrocarbon substances be produced from the tidelands trust area so as to reduce this Nation's dependence upon imported oil products; and WHEREAS, the City and the State Lands Commission desire to permit the City to produce, from the tidelands trust area, oil, gas and other hydrocarbon substances, the revenues from which will be utilized to operate, maintain and improve harbors and beaches within the City for.the benefit of the residents of . the City of Newport Beach and the people.of the State of California; and WHEREAS, it is in the best interests of the City and the State of California to acquire certain rights in real and personal property in.the west Newport area from the operator of the west Newport oil fields, which rights and property are necessary for the development and production of oil, gas and other hydrocarbon substances from the tidelands trust areas which are held in trust by the City; and WHEREAS, it is appropriate and in the best interest of the City of Newport Beach to 'enter into a Joint Powers Agreement with the State Lands Commission for the acquisition and construction of .tidelands oil pumping and storage facilities to facilitate the acquisition of said facilities and rights pursuant to said Agreement; and WHEREAS, the City Council of the City of Newport Beach has reviewed the terms and conditions of said Joint Powers Agreement and finds them to be fair, just and equitable M NOW, THEREFORE, BE IT RESOLVED by the the City of Newport Beach that the Joint Powers acquisition and construction of tidelands oil p facilities beween the City of Newport Beach and Commission be and is hereby approved. BE IT FURTHER RESOLVED that the Mayor are hereby authorized to execute said Agreement City of Newport Beach. ATTEST: City Clerk City Council of Agreement for imping and storage State Lands and City Clerk on behalf of the ADOPTED this day of , 1981. Mayor 041381 HRC /pr