HomeMy WebLinkAboutresolution.council.080-11 RECEPTION #: 584986, 12/12/2011 at
11:16:28 AM,
1 OF 7, R $41.00 Doc Code RESOLUTION
Janice K. Vos Caudill, Pitkin County, CO
RESOLUTION NO.
Series of 2011
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO,
APPROVING THE SECOND AMENDMENT TO THE SI JOHNSON DITCH APPROACH
ROAD CONSTRUCTION AND PIPELINE REPAIR AGREEMENT, BETWEEN AND AMONG
THE CITY, THREE TREES LLC, M.S. 4610 LLC AND WESTCHESTER INVESTMENTS, INC.
WHEREAS, the City is party to several agreements recorded August 6, 2009 at Reception
No. 561702, with Three Trees LLC, M.S. 4610 LLC and Westchester Investments, Inc.
( "Agreements "), including the Si Johnson Ditch Approach Road and Pipeline Repair Agreement,
whereby Three Trees LLC and M.S. 4610 LLC have agreed to perform or pay for certain road
construction and irrigation system repairs to the Si Johnson Ditch; and
WHEREAS, the Agreements require Three Trees LLC and M.S. 4610 LLC to either construct
the road platform for the Approach Road to the Si Johnson Ditch, or pay the sum of $200,000 to the
Si Johnson Ditch Company by October 15, 2010; and
WHEREAS, by Resolution No. 82, Series of 2010, the Aspen City Council authorized an
initial Amendment to Si Johnson Ditch Approach Road and Pipeline Repair Agreement, to extend
that deadline for one year, until October 15, 2012, because of construction and permitting delays; and
WHEREAS, due to further permitting and construction delays, Three Trees and MS 4610
have requested a second amendment to the Si Johnson Ditch Approach Road and Pipeline Repair
Agreement, to extend the construction deadline for the road platform for one additional year, until
October 15, 2012; and
WHEREAS, City staff has advised the City Council that the City and the Si Johnson Ditch
Company will be best served by having the road platform constructed by Three Trees LLC and M.S.
4610 LLC, and therefore the City staff recommends extension of this deadline and approval of the
Second Amendment to Si Johnson Ditch Approach Road and Pipeline Repair Agreement; and
WHEREAS, City Council has had the opportunity to obtain such advice and information as it
deems appropriate and necessary regarding the proposed Second Amendment,
THEREFORE, BE IT RESOLVED, by the City Council of the City of Aspen, that the
Amendment to the Si Johnson Ditch Approach Road and Pipeline Repair Agreement is hereby
approved. The Mayor, City Manager, City Clerk and the Utilities Director are hereby authorized and
directed to execute the Second Amendment, and any related documents necessary or desirable to
effectuate the transactions provided for in said Second Amendment.
Dated: athailf 8 XII
APPROVED by the City Council of the City of Aspen on the /a day of / w /
2011.
`/ / PLC$ -2e41
Mayor
Attest:
City Clerk,
SECOND AMENDMENT TO
SI JOHNSON DITCH APPROACH ROAD CONSTRUCTION
AND PIPELINE REPAIR AGREEMENT
This Second Amendment to the Si Johnson Ditch Approach Road Construction
and Pipeline Repair Agreement ( "Second Amendment ") is made and entered into to be
effective October 15, 2011, regardless of the date of signature, by and between THREE
TREES, LLC, a Colorado limited liability company ( "Three Trees "), M.S. 4610, LLC, a
Colorado limited liability company ( "M.S. 4610 "), and the CITY OF ASPEN,
COLORADO, a home rule Colorado municipality (the "City "), and WESTCHESTER
INVESTMENTS, INC. ( "Westchester "), all collectively referred to below as the
"Parties."
WHEREAS, the Parties entered into the Si Johnson Ditch Approach Road
Construction and Pipeline Repair Agreement effective August 6, 2009, a copy of which
was recorded in the Office of the Pitkin County Clerk & Recorder on August 6, 2009,
Reception No. 561706 ("2009 Agreement ") and a First Amendment to such agreement
("First Amendment ") dated October)�2 , 2010 and recorded on?. -7- // fiat
Reception No. 7 7 q ;and
WHEREAS, pursuant to Paragraphs 2 of the First Amendment, Three Trees
agreed to use its best efforts to construct the Approach Road on or before October 15,
2011 and, if the road was not constructed, to contribute $200,000 to the Ditch Company
by October 15, 2011; and
WHEREAS, although Three Trees has used its best efforts to pursue the proposed
construction project, additional time is required to complete the project; in particular, the
land use approval processes related to the Approach Road took longer than expected in
2011 and Three Trees is still completing final design and specifications for the project;
and
WHEREAS, the Parties are willing to further extend certain deadlines and change
certain terms of the 2009 Agreement and the First Amendment thereto, as set forth below,
provided that except as amended herein, all prior agreements between the Parties shall
remain in full force and effect.
NOW THEREFORE, in consideration of the mutual promises set forth herein,
and other good consideration, the sufficiency of which is acknowledged, the Parties
further agree as follows:
1. All defined terms herein shall have the same meaning as set forth in
Paragraph A.1 of the 2009 Agreement.
2. The deadline set forth in Paragraph 2 of the First Amendment for
completion of the Approach Road or payment of $200,000 in lieu thereof to the Ditch
Company is hereby extended until October 15, 2012. However, should an emergency
arise such that a Major Repair to the Ditch becomes necessary in the opinion of a
1
Colorado - registered professional engineer retained by the City or the Ditch Company
between the date of this Second Amendment and the date that construction of the
Approach Road commences, upon request of the City or the Ditch Company Three Trees
shall immediately contribute $200,000 in good funds to the Ditch Company to be applied
toward such Major Repair and/or toward establishing access to perform the same. Upon
payment of said funds, Three Trees shall no longer be obligated to construct the
Approach Road and the future obligation of Three Trees regarding operation and
maintenance of the Ditch shall be limited to payment of its pro rata share of all future
Ditch Company assessments.
3. Except as amended herein, all prior written agreements between the
Parties shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have executed this First Amendment the
date and year first above written.
[this space left blank intentionally— signatures on following pages]
2
THREE LLC, a Colorado limited liability company
1
By: Warren B. Kanders, Manager
M.S. 4610, LLC, a Colorado limited liability company
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By: Warren B. Kanders, Manager
STATE OF 14`\ )
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COUNTY OF N'\ )
SUBSCRIBED AND SWORN to before me this 21 day of vtooember , 2011,
by Warren B. Kanders, as Manager of Three Trees, -LC, a Colorado limited Liability
company.
WITNESS my hand and official seal.
IOO7AR� STATE OF NE W YORK
N otar N1
No.01JA8203893
OUAUFIED IN QUEENS COUNTY Public
COMMISSION EXPIRES APRIL 13. 20.m.
My commission expires: h .A \ tS , >0%3
STATE OF NA )
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COUNTY OF t"\ )
SUBSCRIBED AND SWORN to before me this at day of NOVe nbey , 2011,
by Warren B. Kanders, as Manager of M.S. 4610, LLC, a Colorado limited liability
company.
WITNESS my hand and official seal.
RAY,yy&�T7TTIEI�JJJ1 JADUNANDAN A /
NOTARY b$ BC,ISTATE 69 N f YORK f aJos -s
No. iO,tJA8203893.
QUALIFIE IN OUEENS COUNTY
COMMISSION EXPIRES APRIL 3, 20 No t y Public
My commission expires: 1414‘ - 43 3013
3
CITY OF ASPEN, COLORADO, a Municipal Corporation and
Home Rule City
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By: _
Title: ,., c ✓
STATE OF COLORADO )
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COUNTY OF PITKIN )
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SUBSCRIBED AND SW to before me this f? day of 2011,
by µ i r4 G t yet O or the City of Aspen, Colorado.
WITNESS my hand and official seal.
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WESTCHESTERINVES T , nelaware Corporation
: y: Eduardo Hernandez i
Title: Corporate Officer
STATE OF F iris 4 )
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COUNTY OF fr 4 ' - bo 0 ' 4 )
SUBSCRIBED AND SWORN to before the this as /Mday of Notts. b.r x{2011,
by Eduardo Hernandez, for Westchester Investments, Inc.
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Notary Pu lic
My commission expires: f //c 2, Z o/C 4 I
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MEMORANDUM
TO: Mayor and City Council
FROM: Cynthia F. Covell, water counsel
THRU: David Hornbacher, Director of Utilities & Environmental
Initiatives
Phil Overeynder, Utilities Engineer, Special Projects
DATE OF MEMO: November 21, 2011
MEETING DATE: November 28, 2011
RE: One -year Extension of Deadline for Construction of Road
Platform for Si Johnson Ditch Vehicular Access
REQUEST OF COUNCIL: Approve Resolution No series of 2011, approving execution
of the Second Amendment to Si Johnson Ditch Approach Road Construction and Pipeline Repair
Agreement, which authorizes a one -year extension of the deadline for Three Trees and MS 4610
to construct the road platform for the Si Johnson Ditch Approach Road pursuant to the parties'
agreements. The one -year extension will require completion of construction on or before
October 15, 2012.
PREVIOUS COUNCIL ACTION:
September 22, 2008: Council approved Ordinance No. 29, Series of 2008, on second
reading, thereby approving an Amendment to Water Service Agreement authorizing provision of
additional City treated water service to property owned by Three Trees LLC, located at 1 Toby
Lane in Pitkin County.
January 26, 2009: Council approved Resolution No. 6, Series of 2009, approving a
variety of agreements with Three Trees LLC and MS 4610 LLC whereby Three Trees LLC and
MS 4610 LLC agreed to (1) provide easements on their properties, including a vehicular access
easement (the AApproach Road®) to allow motorized equipment to access the Si Johnson Ditch
for major repair projects; (2) construct a road platform on the vehicular access easement on or
before October 15, 2010; and (3) repair, at Three Trees= cost, the piped portion of the Si Johnson
Ditch.
October 12, 2010: Council approved Resolution No. 82, Series of 2010, authorizing a
one -year extension of the deadline for construction of the road platform on the vehicular access
easement, due to construction and permitting delays encountered by Three Trees.
Page 1 of 4
June 13, 2011: City Council, as authorized by law, overruled Pitkin County denial of
City Location & Extent Review application for the Approach Road construction.
BACKGROUND:
The agreements approved by Council on January 26, 2009, required Three Trees to construct the
Approach Road to be constructed by Three Trees, at its cost, by October 15, 2010, or to
contribute $200,000 towards the construction of this road, which would then be undertaken by
the City or the Si Johnson Ditch Company at some future date. Three Trees was unable to
construct the road by the original deadline, primarily due to the Pitkin County approval process.
The County advised Three Trees that it the City, as a governmental entity, needed to request the
County to conduct an expedited extent and location review before the Pitkin County Planning
and Zoning Commission under a then- new ordinance regarding Location and Extent Reviews.
The City staff anticipated that the Location and Extent permit would be issued by the County,
and Three Trees could construct the road in 2011.
The County Planning and Zoning Commission denied the City's Location and Extent Review
application. As permitted by law, the City Council overruled that denial on June 13, 2011, and
authorized the City staff to move forward to have the Approach Road constructed. In overruling
the County denial, the City considered the importance of the Approach Road to provide vehicular
access to the Si Johnson Ditch for major repairs, and alternatives to the Approach Road
construction.
DISCUSSION: The City owns an interest in the Si Johnson Ditch which is used to irrigate
many prominent properties within the City limits, including the Benedict Music Tent, the Aspen
Institute and several west end parks. The ditch is an important City irrigation and aesthetic
feature. Like all ditches, it requires occasional major repairs which, in turn, require access by
trucks and other equipment. A portion of the Si Johnson Ditch that is located on a steep hillside
and suspended in a pipeline is particularly difficult to access when major repairs are required.
Three private parcels of land provide possible routes by which the City may gain vehicular access
to the ditch to complete major repairs. These parcels are owned by Three Trees, LLC, Alan
Quasha and Ilona Nemeth (collectively "Quasha "), and Edward H. Wachs, Jr.
City staff historically accessed the Si Johnson Ditch via the abandoned county road which
traversed the Quasha property. In late 2006, the Quashas began construction of a new home that
encroached on the historic access road. The foundation had been installed when the City
obtained an injunction requiring Quashas to cease further construction. The Quashas filed
various counterclaims against the City and City employees. The lawsuit was settled in
September, 2008, and included the Quashas' agreement that the City would have foot access to
the ditch via the Quasha property. While vehicles can be deployed on a portion of the Quasha
property (the "staging area "), the vehicles cannot get to the staging area via the foot access route.
At the time the Quasha settlement was being negotiated, Three Trees agreed to grant the City a
permanent easement through its property to provide the needed vehicular access to the staging
Page 2 of 4
area (the AThree Trees Approach Road @). The City agreed to amend its 1996 water service
agreement regarding the Three Trees property to authorize an additional amount of water use, in
retum for the easement. Three Trees is obligated to construct, at its sole expense, the road
platform on the vehicular access easement. The agreements require construction to be completed
this fall.
Due to the steep grade of the proposed Three Trees access road, Three Trees, as a private
property owner, was unable to obtain a County permit to construct the road. As a government
agency, the City was subject to a Location and Extent review process, and made application for
approval in January 2011. After a noticed public hearing that took place at two County Planning
and Zoning Commission meetings in April, 2011, the Commission denied the application on the
basis that the proposed road did not comply with the AACP. The City Council overruled that
denial on June 13, 2011, as permitted by law, and required the City Engineering Department to
review the design drawings for the road platform construction to confirm that the road would not
further destabilize the slope above the Quasha property.
Since the Council action in June, Three Trees has evaluated its preliminary design drawings and
the associated costs, and is preparing the necessary information documentation for the City
Engineering Department. Three Trees has asked for an additional extension, until October 15,
2012, to complete construction of the road platform. If construction is not completed by that
date, Three Trees must pay the $200,000 to the Si Johnson Ditch Company, which may use the
money to construct the road platform itself, or to secure other means of vehicular access to the Si
Johnson Ditch for major repairs.
FINANCIAL/BUDGET IMPACTS: If Three Trees is not able to build the roadbed by
October, 15, 2012, Three Trees is required to pay $200,000 to the Si Johnson Ditch Company.
Staff believes that it will be more efficient and cost - effective for Three Trees to construct this
road platform in the upcoming construction season, as its construction crews and equipment are
already deployed on its property, and will be there in 2012. If the funds are paid to the Si
Johnson Ditch Company, it will be responsible for contracting for and overseeing construction of
the road platform on the existing easement, or for locating an altemative access route, and
undertaking any necessary contracting or eminent domain proceedings, as well as any required
construction. If this is the case, the City, as the majority shareholder of the Si Johnson Ditch
Company, would be assessed its share of any additional costs beyond the $200,000 payment.
Staff therefore believes that it is in the best interest of the City to grant one further extension of
time to Three Trees.
ENVIRONMENTAL IMPACTS: This memo requests an extension of one year for
construction of the road platform on the Si Johnson Ditch Access Road easement. The
environmental considerations regarding this road platform were considered when the City
Council approved the original contracts for this project in 2009, and also when Council overruled
the County's denial of approval of the City's Location and Extent Review application.
RECOMMENDED ACTION: Staff recommends that Council authorize a one -year extension
of the deadline for Three Trees to construct the road platform, to and including October 15, 2012.
Page 3 of 4
Both Three Trees and Westchester Investments, Inc., the third shareholder of the Si Johnson
Ditch Company, have approved this extension.
ALTERNATIVES: If this extension is not approved, Three Trees will be required to pay
$200,000 to the Si Johnson Ditch Company, and the Ditch Company will be solely responsible
for constructing the road platform or acquiring and constructing any alternative easement or right
of way.
PROPOSED MOTION:
I move that Council approve Resolution Nogaeries of 2011, authorizing approval of the
attached Second Amendment to Si Johnson Ditch Approach Road Construction and Pipeline
Repair Agreement.
CITY MANAGER COMMENTS:
G * � fbiettot rUT
ATTACHMENTS:
Exhibit A — Resolution No. go, Series of 2011
Exhibit B: Second Amendment to Si Johnson Ditch Approach Road Construction and Pipeline
Repair Agreement (signed by Westchester Investments, Inc., Three Trees LLC and MS 4610
LLC)
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