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HomeMy WebLinkAboutItem KAGENDA STAFF REPORT DATE: September 12, 2016 TO: Honorable Mayor and City Council THRU: Jill R. Ingram, City Manager FROM: Jim Basham, Interim Director of Public Works SUBJECT: AUTHORIZE THE CITY MANAGER TO EXECUTE THE STATE LANDS LEASE PRC 3792.1 WITH THE CALIFORNIA STATE LANDS COMMISSION SUMMARY OF REQUEST: That the City Council adopt Resolution No. 6682 1. Approving the State Lands Lease No. PRC 3792.1 Agreement with the California State Lands Commission; 2. Authorizing the City Manager to execute the State Lands Lease No. PRC 3792.1 Agreement; 3. Approve Budget Amendment #17 -03 -01 in the amount of $59,600. 4. Authorize the City Clerk to record with the County Recorder of Orange County the State Lands Lease No. PRC 3792.1 Agreement. BACKGROUND AND ANALYSIS: On June 5, 1967, the City Council approved Resolution No. 1556 authorizing the execution of a 49 -year General Lease — Public Agency Use between the California State Lands Commission and the City of Seal Beach for an existing pier, parking lots, and other related facilities on sovereign land. See Attachment B, Exhibit B for the boundary map. The proposed lease will allow for the use and maintenance of an existing pier with a life guard tower, concrete sheet pile groin, maintenance building, storage building, restaurant, public restroom, picnic area, raised planter areas with retaining walls, three parking lots, a tot lot with a perimeter wall, annual flood control berm, beach nourishment, and lifeguard stations. With the lease expiring on June 21, 2016, the City of Seal Beach applied for a new lease. Staff has been working with the State Lands Commission to renew the proposed lease agreement. At the August 9, 2016 State Lands Commission Meeting, the Commission approved the 30 -year State Lands Lease No. PRC 3792.1 Agreement. See Agenda Item K Attachment D for the State Lands Commission Agenda Item. The agreement will be back dated to June 22, 2016 and will end by June 21, 2046. The proposed Lease Agreement has Special Provisions and General Provisions. These provisions act as conditions the City must follow for the entire length of the Lease Agreement. The General Provisions are standard items that are typical to all agencies entering into a State lands Lease. The Special Provisions are conditions specific to the City of Seal Beach. For example, the following items, but not limited to, will require the Commission's review and approval: modifications to any structures, annual beach nourishment, structural safety report performed every five years and any construction activities. The remaining Special Provisions will require the City to report annually any updates to climate change and sea -level rise. Lastly, the City will be required to submit a summary report, five years before the end of the lease, of information about sea -level rise impacts that may occur toward the end of the lease. These above items can be done at no additional cost to the City. ENVIRONMENTAL IMPACT: There is no environmental impact related to this item. LEGAL ANALYSIS: The City Attorney has reviewed and approved as to form. FINANCIAL IMPACT: The proposed Tidelands Lease requires the City to pay an annual rent in the amount of $59,594, with rent review conducted on the 10th and 20th anniversary of the lease, upon any extension or amendment of an existing sublease, or upon execution of a new sublease, as specified in the lease. This is the first time that the City will be required to pay rent for the lease, which is why a Budget Amendment #17 -03 -01 is required. In the future, the proposed annual rent of $59,594 will be budgeted in the Tidelands Fund. The City has received the invoice from the State Lands Commission in the amount of $59,594 and will issue payment when the City approves the proposed Tidelands Lease. Budget Amendment #17 -03 -01 is as follows: Description Account Revised /Adopted Budget Proposed Budget Budget (diff) Amendment Intergovernmental 034 - 863 -45000 $ - $59,600 $59,600 Transfer in Operation 034 - 000-31502 $1,601,400 $1,661,000 $59,600 Transfer out Operation 001 - 080 -47002 $2,663,800 $2,723,400 $59,600 Page 2 RECOMMENDATION: That the City Council adopt Resolution No. 6682 1. Approving the State Lands Lease No. PRC 3792.1 Agreement with the California State Lands Commission; 2. Authorizing the City Manager to execute the State Lands Lease No. PRC 3792.1 Agreement; 3. Approve Budget Amendment #17 -03 -01 in the amount of $59,600. 4. Authorize the City Clerk to record with the County Recorder of Orange County the State Lands Lease No. PRC 3792.1 Agreement. Als NOTED AND APPROVED: Jim sham . Ingram, City Ma er Inte m Director of Public Works Prepared by: Michael Ho, P.E. Dep. Dir. PW /City Engineer Attachments: A. Resolution No. 6682 B. Proposed 2016 Tidelands Lease No. PRC 3792.1 C. Existing 1967 Tidelands Lease PRC 3792.9 D. State Lands Commission Agenda Item Page 3 Attachment "A" RESOLUTION NUMBER 6682 A RESOLUTION OF THE SEAL BEACH CITY COUNCIL AUTHORIZING THE CITY MANAGER TO EXECUTE THE SEAL BEACH LEASE AGREEMENT NO. PRC 3792.1 WITH THE STATE OF CALIFORNIA THROUGH THE STATE LANDS COMMISSION THE SEAL BEACH CITY COUNCIL DOES HEREBY RESOLVE: Section 1. The City Council hereby approves the California State Lands Commission Lease Agreement No. PRC 3792.1. Section 2. The City Council hereby authorizes and directs the City Manager to execute the State Lands Commission Lease Agreement No. PRC 3792.1. Section 3. The City Council hereby Budget Amendment No. 17 -03 -01 Description Account Revised /Adopted Budget Proposed Budget Budget (diff) Amendment Intergovernmental 034 - 863 -45000 $ - $59,600 $59,600 Transfer in Operation 034 - 000 -31502 $1,601,400 $1,661,000 $59,600 Transfer out Operation 001 -080 -47002 $2,663,800 $2,723,400 $59,600 Section 4. The City Council hereby authorizes and directs the City Clerk to record with the County Recorder of Orange County the State Lands Commission Lease Agreement No. PRC 3792.1. PASSED, APPROVED AND ADOPTED by the Seal Beach City Council at a regular meeting held on the 121h day of September , 2016 by the following vote: AYES: Council Me NOES: Council Me ABSENT: Council Members ABSTAIN: Council Members Sandra Massa - Lavitt, Mayor ATTEST: Robin L. Roberts, City Clerk STATE OF CALIFORNIA } COUNTY OF ORANGE } SS CITY OF SEAL BEACH } I, Robin L. Roberts, City Clerk of the City of Seal Beach, do hereby certify that the foregoing resolution is the original copy of Resolution Number 6682 on file in the office of the City Clerk, passed, approved, and adopted by the City Council at a regular meeting held on the 12th day of September , 2016. Robin L. Roberts, City Clerk Attachment "B" RECORDED AT THE REQUEST OF AND WHEN RECORDED MAIL TO: STATE OF CALIFORNIA California State Lands Commission Attn: Title Unit 100 Howe Avenue, Suite 100 -South Sacramento, CA 95825 -8202 STATE OF CALIFORNIA OFFICIAL BUSINESS Document entitled to free recordation pursuant to Government Code Section 27383 A.P.N. Various County: Orange LEASE NO. PRC 3792.1 SPACE ABOVE THIS LINE FOR RECORDERS USE This Lease consists of this summary and the following attached and incorporated parts: Section 1 Basic Provisions Section 2 Special Provisions Amending or Supplementing Section 1 or 3 Section 3 General Provisions Exhibit A Land Description Exhibit B Site and Location Map Exhibit C -1 Sublease Endorsement Exhibit C -2 Sublease Endorsement Exhibit C -3 Sublease Endorsement Exhibit C -4 Sublease Endorsement SECTION 1 BASIC PROVISIONS THE STATE OF CALIFORNIA, hereinafter referred to as Lessor acting by and through the CALIFORNIA STATE LANDS COMMISSION (100 Howe Avenue, Suite 100- South, Sacramento, California 95825- 8202), pursuant to Division 6 of the Public Resources Code and Title 2, Division 3 of the California Code of Regulations, and for consideration specified in this Lease, does hereby lease, demise, and let to the CITY OF SEAL BEACH, hereinafter referred to as Lessee, those certain lands described in Exhibit A hereinafter referred to as Lease Premises, subject to the reservations, terms, covenants, and conditions of this Lease. Page I of 17 Pages MAILING ADDRESS: 211 8th Street Seal Beach, CA 90740 LEASE TYPE: General Lease — Public Agency Use LAND TYPE: Sovereign LOCATION: Pacific Ocean in the City of Seal Beach, Orange County, as described in Exhibit A attached and by this reference made a part hereof. LAND USE OR PURPOSE: Use and maintenance of an existing pier with a life guard tower, 750 - foot long concrete sheet pile groin, a maintenance building, a storage building, restaurant, public restroom, picnic area, raised planter areas with retaining walls, three parking lots, a tot lot with a perimeter wall, the construction, use, and maintenance of a seasonal flood control berm to prevent beach run -up during winter months, beach nourishment, and the seasonal placement, use, and maintenance of temporary lifeguard stations. TERM: 30 years; beginning June 22, 2016; ending June 21, 2046, unless sooner terminated as provided under this Lease. CONSIDERATION: $59,594 per annum, subject to modification by Lessor as specified in Paragraph 1 of Section 2 — Special Provisions, and Paragraph 3(c) of Section 3 - General Provisions. AUTHORIZED IMPROVEMENTS: X EXISTING: An existing pier with a life guard tower, 750 -foot long concrete sheet pile groin, a maintenance and a storage building, restaurant, public restroom, picnic area, raised planter areas with retaining walls, three parking lots, a tot lot with a perimeter wall, a seasonal flood control berm to prevent beach run -up during winter months, beach nourishment, and the seasonal placement of temporary lifeguard stations. N/A TO BE CONSTRUCTED; CONSTRUCTION MUST BEGIN BY: AND BE COMPLETED BY: LIABILITY INSURANCE: In an amount no less than $5,000,000 per occurrence. SURETY BOND OR OTHER SECURITY: N/A Page 2 of 17 Pages SECTION 2 SPECIAL PROVISIONS BEFORE THE EXECUTION OF THIS LEASE, ITS PROVISIONS ARE AMENDED, REVISED, OR SUPPLEMENTED AS FOLLOWS: Paragraph 3 (c) of Section 3, General Provisions, is amended to replace the word "fifth" with the words "10th and 20th ". Lessor reserves the right to revise the rent upon any extension or amendment of an existing sublease, or upon execution of a new sublease. 2. All future structural modifications or material changes to any of the Authorized Improvements other than routine repairs and maintenance will require Commission staff's review and approval prior to commencement of construction. In the event of an urgent repair requiring immediate action, notification shall be made through Lessor's 24 -hour emergency response number at (562) 590 -5201. 3. Special provisions relating to berm construction and beach nourishment. a. Any equipment to be used on the Lease Premises is limited to that which is directly required to perform the authorized use and shall not include any equipment that may cause damage to the Lease Premises or on other lands subject to Lessor's jurisdiction. b. No refueling, repairs, or maintenance of vehicles or equipment will take place on the Lease Premises or on lands subject to Lessor's jurisdiction. c. Each year prior to berm construction, Lessee shall send a copy of the berm coastal engineering plan to Lessor, and notify Lessor of the approximate dimensions of the berm, the approximate volume of sand material for construction, and the location of the sourced sand material d. Within 15 days after construction of the berm, Lessee shall notify Lessor of the actual dimensions of the berm and the actual volume of sand material used in the construction of the berm. e. Lessee shall notify Lessor within 5 business days of any repairs or additional nourishments needed to maintain the berm following the initial construction and prior to its final deconstruction. f. Lessee shall limit the time, equipment, and personnel active on the Lease Premises to the minimum amount necessary during berm construction and deconstruction. 4. Every five years Lessee shall conduct a structural and utility safety assessment inspection report for the Seal Beach Municipal Pier in compliance with the American Society of Civil Engineers (ASCE), Manuals of Practice (MOP) 130 — Waterfront Facilities Inspection and Assessment and the ASCE Standard Practice Manual for Underwater Investigations. Lessee shall provide a copy of the inspection report, to include any necessary remedial action plan, to Lessor for review. The next inspection shall be conducted and a report submitted on or before July 27, 2020. 5. Lessee shall execute a reimbursement agreement with Lessor to pay for any and all reasonable costs and expenditures paid or incurred by the Commission, its staff or both for review and approval of any plan or related materials required herein, including but not limited to any review or preparation of reports, documents or other actions as required pursuant to the California Page 3 of 17 Pages Environmental Quality Act (CEQA), plan reviews, and/or amendments. Payment by Lessee shall be in a form and manner which is determined by Lessor's staff and is consistent with the requirement of State law. 6. Lessee acknowledges and agrees: a. The site may be subject to hazards from natural geophysical phenomena including, but not limited to, waves, storm waves, tsunamis, earthquakes, erosion, flooding, and sea -level rise ( "climate change effects "). The risks posed to the site from these discrete processes, and the combined, additive impacts of multiple processes are anticipated to increase in severity over the term of the lease due to the localized effects of climate change. Specifically, climate change effects could expose the public restrooms, public beach, constructed berm, and pier infrastructure, including utility and sewer lines, to stronger and prolonged flooding events, requiring maintenance and repair beyond what is regularly needed. Adverse impacts from climate change effects on facilities within the lease area, particularly the public restrooms and sewer lines, could result in degradation of Public Trust resources and values, including water quality, recreation, and public safety. Future conditions may necessitate additional adaptation measures to increase the resiliency of the lease area to the impacts of sea -level rise and coastal climate change processes, as well as continuing to evaluate the effectiveness of the berm in protecting against these impacts. b. To assume the risks to the Lessee and to the property that is the subject of any Coastal Development Permit that is issued to Lessee for development on the Lease Premises, of injury and damage from such hazards in connection with the permitted development and use. c. To unconditionally waive any claim or damage or liability against the State of California, its agencies, officers, agents, and employees for injury or damage from such hazards. Lessee acknowledges that the Lease Premises are subject to the Public Trust and are presently available to members of the public for recreation, waterborne commerce, navigation, fisheries, open space, and any other recognized Public Trust uses. Lessee also agrees that any proposed construction activities and subsequent use of the Lease Premises shall not unreasonably interfere with or limit Public Trust rights, and shall do so only to the extent necessary to protect public health and safety during construction activities authorized by Lessor, or when imminent threats to public health and safety are present. 8. Lessee shall provide Lessor with an annual summary report by the anniversary date of each year, beginning June 22, 2017 or a date to be mutually agreed to by Lessee and Lessor's staff. The report shall include the information requested in Section 2, Paragraph 3 (c) above, along with copies of any local monitoring information required by Lessee or other agencies or entities which relates to sea -level rise vulnerability, structural integrity, and adaptation capacity of the Lease Premises and the facilities therein. Information shall include, but is not limited to: • Sea -level rise and flooding vulnerability and risk assessments, • Updates or amendments to the Local Coastal Program, • Annual flooding frequency and extent, • Annual site photographs, • Schedule and nature of repair and maintenance operations, and • Coastal hazard remediation and removal. Pertinent information may be sourced from the Lessee itself or any other research conducted within the Lease Premises or adjacent land. Page 4 of 17 Pages 9. Five years prior to the expiration of this Lease, Lessee shall submit to Lessor a summary report that details resiliency planning efforts and adaptation strategies related to sea -level rise impacts within the Lease Premises. The report will include a record of flood frequency and extent, and protective measures taken to reduce flood risk to public and visitor serving facilities within the Lease Premises and upland property. It will also include annual records of the constructed berm's height, width, and volume, as well as the berm material's source location. Findings from the utility safety assessment inspection report for the Seal Beach Municipal Pier will also be summarized in the report as well as any emergency repairs made to other structures located in the Lease Premises. The contents of this report will enable Lessor and Lessee to assess the effectiveness of these planning efforts in maintaining and enhancing the resiliency of public trust resources and values within the Lease Premises subject to the risks associated with sea -level rise and climate change. 10. Any beach nourishment activities that necessitate sand material sourced from locations other than the West Beach will require an amendment to this Lease. This includes dredging from submerged lands offshore of the Lease Premises and shipment of materials from locations outside the Lease Premises. 11. Lessee will require Commercial General Liability insurance in an amount of no less than $1,000,000 for all leases or agreements for any activity occurring within the Lease Premises. [Remainder of Page Intentionally Left Blank] Page 5 of 17 Pages SECTION 3 GENERAL PROVISIONS 1.GENERAL In the case of any conflict between these General Provisions and Special Provisions found in Section 2, the Special Provisions control. 2. DEFINITIONS For the purposes of this Lease, the following terms shall be defined as stated below: "Additions" shall be defined as any use or Improvements other than those expressly authorized in this Lease. "Alterations" shall be defined as any material change in the size, scope, density, type, nature, or intensity of Improvements on the Lease Premises from what is authorized in this Lease. Alterations shall also include any modifications, alterations, or renovations of the land or waterways on the Lease Premises other than those authorized by this Lease. "Breach" shall be defined as a party's unjustified or unexcused nonperformance of a contractual duty the party is required to immediately perform. "Damages" shall include all liabilities, demands, claims, actions or causes of action whether regulatory, legislative or judicial in nature; all assessments, levies, losses, fines, penalties, damages, costs and expenses, including, without limitation: (i) reasonable attorneys', accountants', investigators', and experts' fees and expenses sustained or incurred in connection with the defense or investigation of any such liability, and (it) costs and expenses incurred to bring the Lease Premises into compliance with Environmental Laws, a court order, or applicable provisions of a Regulatory Agency. The term "Damages" also includes, expressly, those Damages that arise as a result of strict liability, whether arising under Environmental Laws or otherwise. "Default" shall be defined as a material Breach of magnitude sufficient to justify termination of the Lease. "Environmental Law" shall be defined as and include all federal, state, and local environmental, health, and safety laws, statutes, ordinances, regulations, rules, judgments, orders, and notice requirements, which were in effect as of the date of execution of this Lease or are subsequently enacted and lawfully applied hereto, which regulate or relate to (a) the protection or clean -up of the environment; (b) the use, treatment, storage, transportation, handling or disposal of hazardous, toxic or otherwise dangerous substances, wastes or materials; (c) the quality of the air and the discharge of airborne wastes, gases, particles, or other emissions; (d) the preservation or protection of waterways, groundwater, or drinking water; (e) the health and safety of persons or property; or (f) impose liability with respect to any of the foregoing, including without limitation, the California Environmental Quality Act (CEQA) [PRC §§ 21000 et seq.]; the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA) [42 USCS §§ 9601 et seq.]; the Resource Conservation and Recovery Act of 1976 (RCRA) [42 USCS §§ 6901 et seq.]; the Clean Water Act, also known as the Federal Water Pollution Control Act (FWPCA) [33 USCS §§ 1251 et seq.]; the Toxic Substances Control Act (TSCA) [15 USCS §§ 2601 et seq.]; the Hazardous Materials Transportation Act (HMTA) [49 USCS §§ 1801 et seq.]; the Insecticide, Fungicide, Rodenticide Act [7 USCS §§ 136 et seq.]; the Superfund Amendments and Reauthorization Act [42 USCS §§ 6901 et seq.]; the Clean Air Act [42 USCS §§ 7401 et seq.]; the Safe Drinking Water Act [42 USCS §§ 300f et seq.]; the Solid Waste Disposal Act [42 USCS §§ 6901 et seq.]; the Surface Mining Control and Reclamation Act [30 USCS §§ 1201 et seq.]; the Emergency Planning and Community Right to Know Act [42 USCS §§ 11001 et seq.]; the Occupational Safety and Health Act [29 USCS §§ 655 and 657]; the California Underground Storage of Hazardous Substances Act [H & S C §§ 25280 et seq.]; the California Hazardous Substances Account Act [H & S C §§ 25300 et seq.]; the California Hazardous Waste Control Act [H & S C §§ 25100 et seq.]; the California Safe Drinking Water and Toxic Enforcement Act [H & S C §§ 24249.5 et seq.]; the Porter - Cologne Water Quality Act [Water C §§ 13000 et seq.] together with any amendments of or regulations promulgated under the statutes cited above. "Hazardous Material" shall be defined as and include any substance which falls within the definition of hazardous substance, hazardous waste, hazardous material, toxic substance, solid waste, pollutant, or contaminant, under any Environmental Law. "Improvements" shall be defined as any modification, alteration, addition, or removal of any material, and any other action which serves to change the condition of the Lease Premises from the natural state whether situated above, on, or under the Lease Premises. Improvements include, but are not limited to buildings, structures, facilities, decks, docks, wharves, piers, walks, curbs, bridges, buoys, landscaping, roadways, shoreline protective structures of all types, foundations, pilings or similar support structures whether above or below the water line, fences, utilities, pipelines, and any other construction of any type situated on the Lease Premises. "Lease" shall be defined as this lease contract together with all amendments and exhibits. "Lease Premises" shall be defined as the area of land, together with any improvements located thereon, the use and occupancy of which Form51.16 (Rev. 10/14) Page 6 of 17 Pages is authorized by this Lease. "Lessor" shall be defined as the state of California, acting by and through the California State Lands Commission, including the Commissioners, their alternates and designates, the Executive Officer, and the staff of the California State Lands Commission. "Regulatory Agency" shall include any Federal, State, County, Municipal, or Local agency having jurisdiction over the Lease Premises. "Repairs" shall be defined as all work of any kind made to maintain, change, restore, strengthen, replace, alter, or otherwise affect any Improvement on the Lease Premises. "Residence" shall be defined as any Improvement, whether permanent, movable, or temporary, or a portion thereof, which is for the time being a home or place of lodging. A Residence includes any Improvement affixed to the land such as trailers or cabins, built on a raised foundation such as stilts or pilings, and floating residences such as boats, barges, arks, and houseboats, and any combination of such Improvements which provide residential accommodations to the Lessee or others. "Residence" shall not include transitory, intermittent, recreational use of facilities such as campgrounds. "Residential Use" shall be defined as Improvements such as, but not limited to, sundecks, and sumooms which are extensions of, or additions to, the upland property and are not water- dependent uses. Although the various uses or Improvements which may fall under this definition may vary by geographic area, lease type, or other factors, it is the intention of the parties to include in this definition all uses and Improvements which are not water- dependent but residential in nature, or those uses and Improvements which are not consistent with common law public trust principles and values. 3. CONSIDERATION (a) Absolute Triple Net Lease This Lease is an absolute triple net lease, pursuant to which Lessor has no obligation with respect to the payment of taxes, insurance, the cost of maintenance, utilities and repairs or other costs or obligations associated with the Leased Premises, except as expressly stated herein. (b) Rent Lessee agrees to pay Lessor rent as stated in this Lease, in annual installments, for the use and occupancy of the Lease Premises. The first installment shall be due on or before the beginning date of this Lease and all subsequent installments shall be due on or before each anniversary of its beginning date during each year of the Lease term, or as otherwise provided in this Lease. Said sums shall be paid in lawful money of the United States of America. Lessee shall send said rent to the mailing address of Lessor. Timeliness of receipt of remittances sent by mail shall be governed by the postmark date as stated in Government Code Section 11002. Invoices for rent due may be provided by Lessor as a courtesy. Lessor's failure to, or delinquency in, providing invoices shall neither excuse Lessee from paying rent, nor extend the time for paying rent. (c) Modification Lessor may modify the method, amount, or rate of consideration effective on each fifth anniversary of the beginning date of this Lease. Should Lessor fail to exercise such right effective on any fifth anniversary it may do so effective on any one (1) of the next four (4) anniversaries following such fifth anniversary, without prejudice to its right to effect such modification on the next or any succeeding fifth anniversary of the beginning date. No such modification shall become effective unless Lessee is given at least thirty (30) days' notice prior to the date of the Commission meeting wherein the rent modification is considered, or thirty (30) days' notice prior to the effective date of the increase, whichever provides a greater notice period. If the consideration for this Lease is based on a percentage of income, royalties, profits, or any similar business performance indicators, Lessee shall provide Lessor with financial statements and all other documents necessary to determine the relevant basis for income. (d) Penalty and Interest Any installments of rent accruing under this Lease not paid when due shall be subject to a delinquency charge equal to five percent (5 %) of the principal sum due. Annual payments shall bear interest as specified in Public Resources Code Section 6224 and the Lessor's then existing administrative regulations governing penalty and interest. (e) Non- Monetary Consideration If the consideration to Lessor for this Lease is the public use, benefit, health, or safety, Lessor shall have the right to review such consideration at any time and set a monetary rental if the Lessor, at its sole discretion, determines that such action is in the best interest of the State. Lessee's assignment or transfer of this Lease pursuant to Section 3 Paragraph 11 below to any third party Form51.16 (Rev. 10/14) Page 7 of 17 Pages which results in royalties, profits, or any form of compensation, whether monetary or otherwise, shall give Lessor the right to reevaluate the requirements of this Lease as stated in Section 3 Paragraph 11. Lessee shall be given at least thirty (30) days' notice prior to the date of the Commission meeting wherein the rent modification is considered, or thirty (30) days' notice prior to the effective date that this Lease is converted to a monetary rental, whichever provides more notice. (f) Place for Payment of Rent All rent that becomes due and payable under this Lease shall be paid to Lessor in person or by United States mail at the Sacramento Offices of the California State Lands Commission, currently at 100 Howe Avenue, Suite 100 - South; Sacramento, CA 95825 -8202, or at any other place or places that Lessor may designate by written notice to Lessee. Alternately, Lessee may contact Lessor's accounting department for Lessor's current practices for payment by credit card or electronic fund transfer. 4. BOUNDARIES This Lease is not intended to establish the State's boundaries and is made without prejudice to either party regarding any boundary or title claims which may be asserted presently or in the future. 5. LAND USE (a) General (1) Lessee shall use the Lease Premises only for the purpose or purposes stated in this Lease and only for the operation and maintenance of the Improvements expressly authorized in this Lease. Lessee shall commence use of the Lease Premises within ninety (90) days of the beginning date of this Lease or within ninety (90) days of the date set for construction to commence as set forth in this Lease, whichever is later. (2) All demolition, construction, remodeling, reconstruction, maintenance, repairs, removal, or remediation performed on the Lease Premises at any time by Lessee shall first be authorized by all appropriate Regulatory Agencies. Lessee is solely responsible for determining what approvals, authorizations, or certifications are required, and shall be solely responsible for all costs incurred thereby. In addition, Lessee shall obtain and comply with preventative or remedial measures required by any environmental reports, assessments, or inspections, including, but not limited to those required by the California Environmental Quality Act and/or the National Environmental Policy Act, or as otherwise required by law or reasonably requested by Lessor. Nothing in this Lease shall be interpreted as a pre - approval of any permit, certification, or any other precondition required for the use of the Lease Premises. (b) Continuous Use Lessee's use of the Lease Premises shall be continuous from commencement of the Lease until its expiration. Lessee's discontinuance of such use for a period of ninety (90) days shall be presumed to be an abandonment unless Lessee demonstrates to Lessor's satisfaction that Lessee's use of the Lease Premises is consistent with similarly situated properties. In the event of an abandonment, Lessor may elect to terminate the Lease as provided in Paragraph 12(a)(3). Abandonment of the Lease Premises shall not relieve Lessee of any obligations under this Lease. (c) Repairs and Maintenance (1) Lessor shall not be required to make any Repairs in, on, or about all or part of the Lease Premises. Lessee shall, at all times during the term of this Lease and without any cost or expense to Lessor, keep and maintain the Lease Premises, including all Improvements, in good order and repair and in a clean, safe, sanitary, and orderly condition. (2) Lessee shall make, or cause to be made, any Repairs which may be required by any Regulatory Agency. Lessee shall observe and comply with, any law, statute, ordinance, plan, regulation, resolution, or policy applicable to the Lease Premises in making such Repairs. All work shall be performed with reasonable diligence, completed within a reasonable time, and performed at the sole cost and expense of Lessee. (3) Lessee expressly accepts the Lease Premises "as is" and expressly acknowledges that: (i) Lessor has made no representations or warranties as to the suitability of the Lease Premises for any Improvements. Lessee shall conduct all tests necessary to determine the suitability of the Lease Premises for any proposed use or Improvements authorized; and (it) Lessor has made no representations or warranties as to the quality or value of any Improvements found on the Lease Premises, or of their conformity to any applicable building codes, zoning ordinances, or other regulations. Lessee agrees to inspect any preexisting Improvements at its own cost to determine whether such Improvements are safe and suitable for Form51.16 (Rev. 10/14) Page 8 of 17 Pages the Lessee's intended use; and (iii) Lessee shall neither be entitled to any reduction in rent, nor any extension of the terms of this Lease because of damage to or destruction of any Improvements on the Lease Premises. (iv) Lessee and Lessor agree that any Improvements on the Lease Premises constitute the personal property of Lessee and that fixture law does not apply. (4) In the event that the Lease Premises is partly, or in whole, comprised of tidal, submerged, or waterfront property, Lessee expressly accepts the hazards involved in using or improving such lands. Lessor is not responsible for, and Lessee shall not be reimbursed for nor receive any offset of rent for, any damages or reduced use of the Lease Premises caused by: local or invasive flora or fauna, flooding, erosion, sea level rise, storms, freezing, inclement weather of any kind, acts of god, maintenance or failure of protective structures, and any other such hazards. (d) Additions, Alterations, and Removal No Improvements other than those expressly authorized in this Lease shall be constructed by the Lessee on the Lease Premises without the prior written consent of Lessor. Any Additions or Alterations are expressly prohibited. Lessee is also prohibited from any Additions or Alterations which cause a material change to the environmental impact on or around the Lease Premises. (e) Enjoyment This Lease is non - exclusive, and is subject to the provisions of Section 3, Paragraph 6 below. Lessee shall have the right to exclude persons from the Lease Premises only when their presence or activity constitutes a material interference with Lessee's use and enjoyment of the Lease Premises. (f) Discrimination Lessee, in its use of the Lease Premises, shall not discriminate against any person or class of persons on any basis protected by federal, state, or local law, including: race, color, creed, religion, national origin, sex, sexual orientation, gender identity, age, marital/parental status, veteran status, or disability. (g) Residential Use Unless otherwise provided for in this Lease, no portion of the Lease Premises shall be used as a location for a Residence, for the purpose of mooring or maintaining a structure which is used as a Residence, or for Residential Uses. (h) Commercial Use Unless otherwise provided for in this Lease, the Lease Premises is to be used by Lessee and Lessee's invitees or guests only. Use of the Lease Premises for commercial purposes; conducting a business, whether for profit or otherwise; and any subleasing, rental, or any transaction whereby Lessee directly or indirectly receives compensation from a third party in exchange for use of the Lease Premises shall constitute an immediate Default of this lease with no cure period. 6. RESERVATIONS, ENCUMBRANCES, AND RIGHTS -OF -WAY (a) Reservations (1) Lessor expressly reserves all natural resources in or on the Lease Premises, including but not limited to timber, minerals, and geothermal resources as defined under Public Resources Code sections 6401, 6407, and 6903, respectively; the right to grant and transfer the same; as well as the right to grant leases in and over the Lease Premises which may be necessary or convenient for the extraction of such natural resources. Such leasing shall be neither inconsistent nor incompatible with the rights or privileges of Lessee under this Lease. (2) Lessor expressly reserves a right to go on the Lease Premises and all Improvements for any purposes associated with this Lease or for carrying out any function required by law, or the rules, regulations, or management policies of the State Lands Commission. Lessor shall have a right of reasonable access to the Lease Premises across Lessee owned or occupied lands adjacent to the Lease Premises for any purpose associated with this Lease. (3) Lessor expressly reserves to the public an easement for convenient access across the Lease Premises to other State -owned lands located near or adjacent to the Lease Premises and a right of reasonable passage across and along any right -of -way granted by this Lease; however, such easement or right -of -way shall be neither inconsistent nor incompatible with the rights or privileges of Lessee under this Lease. Form51.16 (Rev. 10/14) Page 9 of 17 Pages (4) Lessor expressly reserves the right to lease, convey, or encumber the Lease Premises, in whole or in part, during the Lease term for any purpose not inconsistent or incompatible with the rights or privileges of Lessee under this Lease. (b) Encumbrances The Lease Premises may be subject to pre- existing contracts, leases, licenses, easements, encumbrances, and claims and is made without warranty by Lessor of title, condition, or fitness of the land for the stated or intended purpose. RULES, REGULATIONS, AND TAXES (a) Lessee shall comply with and be bound by all presently existing or subsequently enacted rules, regulations, statutes or ordinances of the State Lands Commission or any Regulatory Agency. Occupancy or use of the Lease Premises provides no exemption from applicable regulations including, but not limited to, federal, state, county and local regulations, regulations promoting public health, safety, or welfare, building codes, zoning ordinances, and sanitation regulations. Lessee expressly acknowledges that Regulatory Agencies have jurisdiction over the Lease Premises unless such laws are in direct conflict with state law or public trust principles. (b) Lessee understands and agrees that a necessary condition for the granting and continued existence of this Lease is that Lessee obtains and maintains all permits or other entitlements. Lessee expressly acknowledges that issuance of this Lease does not substitute for, or provide preference in obtaining authorizations from other Regulatory Agencies. (c) Taxes (I) In addition to the rent due under this Lease, Lessee accepts responsibility for and shall pay any and all real and personal property taxes, including possessory interest taxes, assessments, special assessments, user fees, service charges, and other charges of any description levied, imposed on, assessed, or associated with the leasehold interest, Improvements on the Lease Premises, any business or activity occurring on the Lease Premises, the Lease Premises itself, or any portion thereof, levied by any governmental agency or entity. Such payment shall not reduce rent due Lessor under this Lease and Lessor shall have no liability for such payment. (2) In the event that this Lease commences, terminates or expires during a tax year, Lessee shall pay the taxes for the period of such year during which this Lease was in effect. (3) Any and all taxes and assessments and installments of taxes and assessments required to be paid by Lessee under this Lease shall be paid when due and the official and original receipt for the payment of such tax, assessment, or installment shall be delivered to Lessor upon request. (4) Lessee shall indemnify and hold Lessor, the Lease Premises, and any Improvements now or hereafter located thereon, free and harmless from any liability, loss, or Damages resulting from any taxes, assessments, or other charges required by this Lease to be paid by Lessee and from all interest, penalties, and other sums imposed thereon and from any sales or other proceedings to enforce collection of any such taxes, assessments, or other charges. 8. INDEMNITY (a) Lessee's use of the Lease Premises and any Improvements thereon is at Lessee's sole and exclusive risk. (b) In addition to any other obligation to indemnify Lessor as otherwise provided in this Lease, except to the extent caused by the sole negligence and/or willful misconduct of the Lessor, Lessee shall indemnify, hold harmless, and, at the option of Lessor, defend Lessor, its officers, agents, and employees from any and all Damages resulting from Lessee's occupation and use of the Lease Premises. Lessee shall reimburse Lessor in full for all reasonable costs and attorneys' fees, specifically including, without limitation, any Damages arising by reason of.. (1) The issuance, enjoyment, interpretation, Breach, or Default of this Lease; (2) The challenge to or defense of any environmental review upon which the issuance of this Lease is based; (3) The death or injury of any person, or damage to or destruction of any property from any cause whatever in any way connected with the Lease Premises, or with any of the Improvements or personal property on the Lease Premises; (4) The condition of the Lease Premises, or Improvements on the Lease Premises; (5) An act or omission on the Lease Premises by Lessee or any person in, on, or about the Lease Premises; (6) Any work performed on the Lease Premises or material furnished to the Lease Premises; (7) Lessee's failure to comply with any material legal or other requirement validly imposed on Lessee or the Lease Premises by a Regulatory Agency. (c) The reimbursement provisions of this Paragraph 8 shall not apply to any claims, litigation, or other actions which may be brought by either Lessee or Lessor against each other. (d) Nothing in this paragraph shall be construed as requiring that Lessor defend itself against all or any aspect of any challenge to Form51.16 (Rev. 10/14) Page 10 of 17 Pages this Lease or any associated environmental review. However, Lessee may take whatever legal action is available to it to defend this Lease or any associated environmental review against any challenge by a third party, whether or not Lessor chooses to raise a defense against such a challenge. (e) Lessee shall notify Lessor immediately in case of any accident, injury, or casualty on the Lease Premises. 9. INSURANCE (a) Lessee shall obtain and maintain in full force and effect during the term of this Lease comprehensive general liability insurance and property damage insurance, with such coverage and limits as may be reasonably requested by Lessor from time to time, but in no event for less than the sum(s) specified against any and all claims or liability arising out of the ownership, use, occupancy, condition, or maintenance of the Lease Premises and all Improvements. (b) The insurance policy shall identify the Lease by its assigned number. The specific Improvements shall also be generally identified, as well as their location on state owned property. The coverage provided shall be primary and non - contributing. Lessee shall keep such policy current. Lessor shall be named as a "certificate holder" and /or an "additional interest" on the policy. Lessee shall provide Lessor with a current certificate of insurance at all times. At Lessor's request, Lessee shall provide a full copy of the current insurance policy, along with any and all endorsements or other such documents affecting the coverage. Lessor will not be responsible for any premiums or other assessments on the policy. (c) The insurance coverage specified in this Lease shall be in effect at all times during the Lease term and subsequently until Lessor has either accepted all of the Lease Premises as improved or restored by Lessee as provided elsewhere in this Lease. Lessee shall notify Lessor within five (5) business days if the insurance is canceled for any reason. 10. SURETY BOND (a) When required by Section l of this Lease, Lessee shall provide a surety bond or other security device acceptable to Lessor, for the specified amount, and naming the State of California, California State Lands Commission as the assured, to guarantee to Lessor the faithful observance and performance by Lessee of all of the terms, covenants, and conditions of this Lease. (b) Lessor may require an increase in the amount of the surety bond or other security device to cover any additionally authorized Improvements, any modification of consideration, or to provide for inflation or other increased need for security. The surety bond or other security device may be increased on each fifth anniversary of the beginning date of this Lease. Should Lessor fail to exercise such right effective on any fifth anniversary, it may do so effective on any one (I) of the next four (4) anniversaries following such fifth anniversary without prejudice to its right to effect such modification on the next or any succeeding fifth anniversary. No such modification shall become effective unless Lessee is given at least thirty (30) days' notice prior to the date of the Commission meeting wherein the modification of the bond or security is considered, or thirty (30) days' notice prior to the effective date of the increase, whichever provides more notice. (c) The surety bond or other security device shall be maintained in full force and effect at all times during the Lease term and subsequently until Lessor has either accepted all of the Lease Premises as improved or restored by Lessee as provided elsewhere in this Lease. Lessee must first seek approval of Lessor before changing the type of security device used, or the bond holder. 11. ASSIGNMENT, ENCUMBRANCING OR SUBLETTING (a) Lessee shall not either voluntarily or by operation of law, assign, transfer, mortgage, pledge, hypothecate or encumber this Lease and shall not sublet the Lease Premises, in whole or in part, or allow any person other than the Lessee's employees, agents, servants and invitees to occupy or use all or any portion of the Lease Premises without the prior written consent of Lessor, which consent shall not be unreasonably withheld. (1) Notwithstanding the foregoing prohibition against transfer and assignment, the Lease may be transferred by Lessee if the transfer is caused by the death of a spouse and the full interest of the deceased spouse is transferred to a surviving spouse; or the transfer is caused by the dissolution of the marriage of Lessee and the full interest of one of the spouses is transferred to the other spouse. In the event of such a transfer, Lessor shall be notified in writing within 30 days of the transfer. (2) Notice to Lessor of Successor Trustee(s): In the event this Lease is held in trust, and the Lessee is a trustee thereof, the substitution or succession of a new trustee shall not be an assignment or transfer for the purposes of this Paragraph. Lessee (and by operation of law, any successor trustee) agrees to provide prompt notice to Lessor of any succession or substitution of trustee in accordance with Paragraph 16(c) of General Provisions, no later than sixty (60) days after the named trustee as appears on the face of this Lease becomes unable or ceases to serve as trustee for any reason. (b) The following shall be deemed to be an assignment or transfer within the meaning of this Lease: Form51.16 (Rev. 10/14) Page It of t7 Pages (I) If Lessee is a business entity, any dissolution, merger, consolidation or other reorganization of Lessee, or the sale or other transfer of substantially all the assets of Lessee. If Lessee is a publicly traded entity, transfers of interests in Lessee shall not constitute an assignment requiring the consent of Lessor. (2) If Lessee is a partnership, a transfer of any interest of a general partner, a withdrawal of any general partner from the partnership, or the dissolution of the partnership. (c) If this Lease is for sovereign lands appurtenant to adjoining littoral or riparian land, Lessee shall not transfer or assign its ownership interest or use rights in such adjoining lands separately from the leasehold rights granted herein without the prior written consent of Lessor. (d) If Lessee desires to assign, sublet, encumber or otherwise transfer all or any portion of the Lease Premises, Lessee shall do all of the following: (1) Give not less than 90 days' prior written notice to Lessor; (2) Provide the name, complete business organization, operational structure, and formation documents of the proposed assignee, sublessee, secured third party, or other transferee; and the nature of the use of and interest in the Lease Premises proposed by the assignee, sublessee, secured third party or other transferee. (3) Provide the terms and conditions of the proposed assignment, sublease, or encumbrance or other transfer; (4) Provide audited financial statements for the two most recently completed fiscal years of the proposed assignee, sublessee, secured party or other transferee; and provide pro forma financial statements showing the projected income, expense and financial condition resulting from use of the Lease Premises; and (5) Provide such additional or supplemental information as Lessor may reasonably request concerning the proposed assignee, sublessee, secured party or other transferee. (6) Lessor will evaluate proposed assignees, sublessees, secured third parties and other transferees and grant approval or disapproval according to standards of commercial reasonableness considering the following factors within the context of the proposed use: the proposed party's financial strength and reliability, their business experience and expertise, their personal and business reputation, their managerial and operational skills, their proposed use and projected rental, as well as other relevant factors. (e) Lessor shall have a reasonable period of time from the receipt of all documents and other information required under this provision to grant or deny its approval of the proposed party. Lessor may reevaluate the rent, insurance and/or bond provisions of this Lease, and may condition its approval of the proposed assignment, sublease, hypothecation, mortgage, or other transfer on the party's acceptance of the new terms. Lessee's rights stated in this paragraph shall apply regardless of whether the proposed transfer coincides with a regular rent review period as stated in Section 3 Paragraph 3(c) above. (0 Lessee's mortgage or hypothecation of this Lease, if approved by Lessor, shall be subject to terms and conditions imposed by a separately negotiated encumbrancing agreement. (g) Upon the express written assumption of all obligations and duties under this Lease by an assignee approved by Lessor, the Lessee may be released from all liability under this Lease arising after the effective date of assignment and not associated with Lessee's use, possession or occupation of or activities on the Lease Premises; except as to any hazardous wastes, substances or materials as defined under federal, state or local law, regulation, or ordinance manufactured, generated, used, placed, disposed, stored or transported on the Lease Premises during Lessee's tenancy. (h) If the Lessee files a petition or an order for relief is entered against Lessee, under Chapters 7, 9, 11 or 13 of the Bankruptcy Code (I I USC Sect. 101, et seq.) then the trustee or debtor -in- possession must elect to assume or reject this Lease within sixty (60) days after filing of the petition or appointment of the trustee, or the Lease shall be deemed to have been rejected, and Lessor shall be entitled to immediate possession of the Lease Premises. No assumption or assignment of this Lease shall be effective unless it is in writing and unless the trustee or debtor -in- possession has cured all Defaults under this Lease (monetary and non - monetary) or has provided Lessor with adequate assurances (l) that within ten (10) days from the date of such assumption or assignment, all monetary Defaults under this Lease will be cured; and (2) that within thirty (30) days from the date of such assumption, all non - monetary Defaults under this Lease will be cured; and (3) that all provisions of this Lease will be satisfactorily performed in the future. Forms L 16 (Rev. 10/14) Page 12 of 17 Pages (i) In the event of any transfer or assignment, under this Paragraph 1 I or by any other means authorized by this Lease, the Lease terms shall be for the remaining years existing on the Lease prior to the transfer or assignment. A transfer or assignment shall not extend the term of this Lease. 12. DEFAULT AND REMEDIES (a) Default The occurrence of any one or more of the following events shall immediately and without further notice constitute a Default of this Lease: (1) Lessee's failure to make any payment of rent, royalty, or other consideration as required under this Lease; or (2) Lessee's failure to obtain or maintain liability insurance or a surety bond or other security device as required under this Lease: or (3) Lessee's abandonment of the Lease Premises (including the covenant for continuous use as provided for in Paragraph 5(b)) during the Lease term; or (4) Lessee's failure to obtain and maintain all necessary governmental permits or other entitlements; or (5) The maintenance of the Lease Premises in violation of, or failure to comply with, any applicable provisions of any Regulatory Agency, Environmental Law, or maintenance of the Lease Premises in a condition constituting nuisance; or (6) Lessee's Failure to commence to construct and to complete construction of the Improvements authorized by this Lease within the time limits specified in this Lease. (7) Lessee is found to sublet or otherwise surrender daily management and control of the Lease Premises to a third party without the knowledge, expressed written consent or authorization of the Lessor. (b) Lessee's failure to observe or perform any other term, covenant, or condition of this Lease when such failure shall continue for a period of thirty (30) days after Lessor's giving written notice shall constitute a Default of this lease. However, if the nature of Lessee's Default under this paragraph is such that more than thirty (30) days are reasonably required for its cure, then Lessee shall not be deemed to be in Default if Lessee commences such cure within such thirty (30) day period and diligently proceeds with such cure to completion. (c) Should Lessee Breach any term, covenant, or condition of this Lease under Paragraph 12(b) above three (3) times in any three hundred and sixty -five (365) day period, the third Breach will be a Default under this Lease and Lessor will be entitled to immediately terminate this Lease, and take other appropriate action. Lessor will provide written notice of each Breach as provided above, and provide written notice that future Breaches will constitute immediate Default with no cure period. (d) Remedies In the event of a Default by Lessee and Lessee's failure to cure such Default if such a cure period is applicable, Lessor may at any time and with or without notice do any one or more of the following in addition to any rights or remedies permitted by law: (1) Re -enter the Lease Premises, remove all persons and property, and repossess and enjoy such premises; or (2) Terminate this Lease and Lessee's right of possession of the Lease Premises by any lawful means. The termination shall not relieve Lessee of any obligation, monetary or otherwise, which has accrued prior to the date of termination. Such termination shall be effective upon Lessor's giving written notice and upon Lessee's receipt of such notice. Lessee shall immediately surrender possession of the Lease Premises to Lessor. Lessor shall be entitled to recover from Lessee all amounts to which Lessor is entitled pursuant to Section 1951.2 of the California Civil Code, or any other provision of law, including any necessary Repair, renovation, alteration, remediation, or removal of Improvements; or (3) Maintain this Lease in full force and effect and recover any rent, royalty, or other consideration as it becomes due without terminating Lessee's right of possession regardless of whether Lessee shall have abandoned the Lease Premises, subject to the conditions imposed by Cal. Civil Code § 1951.2; or Form51.16 (Rev. 10/14) Page 13 of 17 Pages (4) Exercise any other right or remedy which Lessor may have at law or equity. (e) Determination of Rental Value If rent under this Lease is calculated as a percentage of Lessee's income attributable to the Lease Premises and Lessee abandons the Lease Premises during some or all of the applicable period, then the reasonable rental value shall be the percentage of proceeds Lessor would have received had Lessee operated the Lease Premises in the usual and customary manner. (f) Waiver of Rights The failure or delay of either party to exercise any right or remedy shall not be construed as a waiver of such right or remedy or any Breach by the other party. Lessor's acceptance of any rent shall not be considered a waiver of any preexisting Breach by Lessee other than the failure to pay the particular rent accepted regardless of Lessor's knowledge of the preexisting Breach at the time rent is accepted. 13. RESTORATION OF LEASE PREMISES AND ENVIRONMENTAL MATTERS (a) Restoration of Lease Premises (1) Upon expiration or sooner termination of this Lease, Lessee must immediately surrender possession of the Lease Premises to Lessor. Prior to the time of surrender, Lessee must remove all or any Improvements together with the debris and all parts of any such Improvements at its sole expense and risk, regardless of whether Lessee actually constructed or placed the Improvements on the Lease Premises; or Lessor, at its sole and absolute discretion, may itself remove or have removed all or any portion of such Improvements at Lessee's sole expense. Lessor may waive all or any part of this obligation in its sole discretion if doing so is in the best interests of the State. (2) As a separate and related obligation, Lessee shall restore the Lease Premises as nearly as possible to the conditions existing prior to the installation or construction of any Improvements. For purposes of this Lease, restoration includes removal of any landscaping; removal of any Hazardous Materials; and to the extent possible, undoing any grading, fill, excavation, or similar alterations of the natural features of the Lease Premises. Lessor may waive all or any part of this obligation in its sole and absolute discretion. (3) Unless otherwise provided for in this Lease, Lessee shall submit to Lessor no later than one (1) year prior to the expiration of this Lease either: (a) an application and minimum expense deposit for a new lease for the continued use of the Lease Premises, or (b) a plan for the restoration of the Lease Premises to be completed prior to the expiration of the lease term together with a timeline for obtaining all necessary permits and conducting the work prior to the expiration of this Lease. (4) In removing any or all Improvements, or conducting any restoration work, Lessee shall be required to obtain any permits or other governmental approvals as may then be required by any Regulatory Agency, including, without limitation, any Environmental Law. (5) Lessor may, upon written notice, in its sole and absolute discretion, accept title to any or all Improvements at the termination of this Lease. Lessor shall notify Lessee that Lessor intends to take title to any or all Improvements within six (6) months of Lessee submitting a plan for restoration under Paragraph 13(a)(3)(b) above. If Lessor elects to take title to any such Improvements, Lessee shall deliver to Lessor such documentation as may be necessary to convey title to such Improvements to Lessor free and clear of any liens, mortgages, loans, or any other encumbrances. Lessor shall not pay, and Lessee shall not be entitled to compensation for Lessor's taking title to such property. (b) Environmental Matters (t) Lessee's Obligations: (i) Lessee will not use, occupy, or permit any portion of the Lease Premises to be used or occupied in violation of any Environmental Law. Lessee shall not manufacture or generate or store Hazardous Material on the Lease Premises unless specifically authorized under other terms of this Lease. (it) Lessee shall practice conservation of water, energy, and other natural resources. (iii) Lessee shall notify Lessor and the appropriate governmental emergency response agency, or agencies immediately in the event of any release or threatened release of any Hazardous Material. (2) Lessor may at any time during the Lease term require Lessee to conduct at its own expense and by a contractor approved Form51.16 (Rev. 10/14) Page 14 of 17 Pages by Lessor an independent environmental site assessment or inspection for the presence or suspected presence of Hazardous Material generated, used, placed, disposed, stored, or transported on the Lease Premises during the term of the Lease. Lessee shall provide the results of the assessment or inspection to Lessor and the appropriate governmental response agency or agencies and shall further be responsible for removing or taking other appropriate remedial action regarding such Hazardous Material in accordance with applicable Environmental Law. (3) Environmental Indemnity. Lessee shall indemnify, defend, and hold Lessor and Lessor's, officer, appointees, volunteers, employees, agents, successors and assigns free and harmless from and against all Damages that may at any time be imposed upon, incurred by, or asserted or awarded against Lessor in connection with or arising from any Breach of Lessee's obligations hereunder; or out of any violation by Lessee of any Environmental Law; or resulting in the imposition of any lien or claim for the recovery of any costs for environmental cleanup or other response costs relating to the release or threatened release of Hazardous Materials on the Lease Premises during the Lessee's tenancy. This obligation shall include any prior leases between Lessor and Lessee and will continue through any periods Lessee is in holdover, unlawful detainer, or any subsequent month -to -month tenancies created by operation of law. Lessee's obligations hereunder will survive the expiration or sooner termination of this Lease. (4) Violation of this section shall constitute grounds for termination of the Lease. Lessor, shall notify Lessee when, in Lessor's opinion, Lessee has violated the provisions of this section. Lessee shall immediately discontinue the conduct and respond within five (5) business days. Lessee shall take all measures necessary to remedy the condition. 14. QUITCLAIM Lessee shall, upon the early termination of this Lease and at Lessor's request, execute and deliver to Lessor in a form provided by Lessor a good and sufficient release of all rights under this Lease. Should Lessee fail or refuse to deliver such a release, Lessor may record a written notice reciting such failure or refusal. This written notice shall, from the date of its recordation, be conclusive evidence against Lessee of the termination of this Lease and all other claimants. 15. HOLDING-OVER (a) This Lease shall terminate without further notice upon the expiration of the term of this Lease. Lessee shall have removed any Improvements and completed any restoration as required by Lessor prior to the expiration of this Lease, and shall surrender possession of the Lease Premises. Any failure by the Lessee to remove Improvements, restore the Lease Premises, and/or surrender possession of the Lease Premises at the expiration or sooner termination of this Lease shall not constitute a renewal or extension and shall not give Lessee any rights in or to the Lease Premises or any part thereof except as expressly provided in this Lease. Lessee shall be deemed in unlawful detainer of the Lease Premises and Lessor shall be entitled to all resulting legal remedies. (b) Lessor may, in its sole discretion, choose to accept Rent for the Lease Premises instead of immediately taking legal action to recover possession of the Lease Premises. Any tenancy created by operation of law on Lessor's acceptance of rent shall be deemed a month -to -month tenancy regardless of what sum or sums Lessee delivers to Lessor. Except as set forth below, any subsequent tenancy created in this manner shall be on the same terms, covenants, and conditions set forth in this Lease insofar as such terms, covenants, and conditions can be applicable to a month -to -month tenancy (c) In recognition of the increased accounting, land management, and supervisory staff time required for month -to -month tenancies, the rent for each month or any portion thereof during such holdover period may be an amount equal to one hundred fifty percent (150 %) of one - twelfth (1/12) of the total compensation for the most recent year paid. In the event this Lease does not require monetary compensation, Lessor shall have the right to establish rent based on the fair market value of the Lease Premises. The month -to -month tenancy may be terminated by Lessee or Lessor upon thirty (30) calendar days' prior written notice to the other. 16. ADDITIONAL PROVISIONS (a) Waiver (1) No term, covenant, or condition of this Lease and no omission, neglect, Default or Breach of any such term, covenant or condition shall be deemed to have been waived by Lessor's acceptance of a late or nonconforming performance or otherwise, unless such a waiver is expressly acknowledged by Lessor in writing. No delay or omission of Lessor to exercise any right or power arising from any omission, neglect, Default or Breach of term, covenant, or condition of this Lease shall be construed as a waiver or any acquiescence therein. (2) Any such waiver shall not be deemed to be a waiver of any other term, covenant or condition; of any successive Breaches of the same term, covenant, or condition; or of any other Default or Breach of any term, covenant or condition of this Lease. Form51.16 (Rev. 10/14) Page 15 of 17 Pages (b) Time Time is of the essence for this Lease and each and all of its terms, covenants or conditions in which performance is a factor. (c) Notice All notices required to be given under this Lease shall be given in writing, sent by U.S. Mail with postage prepaid, to Lessor at the offices of the State Lands Commission and the Lessee at the address specified in this Lease. Lessee shall give Lessor notice of any change in its name or address. (d) Consent Where Lessor's consent is required under this Lease its consent for one transaction or event shall not be deemed to be a consent to any subsequent occurrence of the same or any other transaction or event. (e) Changes This Lease may be terminated and its term, covenants, and conditions amended, revised, or supplemented only by mutual written agreement of the parties. (t) Successors The terms, covenants, and conditions of this Lease shall extend to and be binding upon and inure to the benefit of the heirs, successors, and assigns of the respective parties. (g) Joint and Several Obligation If more than one Lessee is a party to this Lease, the obligations of the Lessees shall be joint and several. (h) Captions The section and paragraph captions used in this Lease are for the convenience of the parties. The captions are not controlling and shall have no effect upon the construction or interpretation of this Lease. (i) Severability If any term, covenant or condition of this Lease is determined by a court of competent jurisdiction to be invalid or unenforceable, the remainder of this Lease shall not be affected thereby, and each term and provision of this Lease shall remain valid and enforceable to the fullest extent permitted by law. (j) Representations Lessee agrees that no representations have been made by Lessor or by any person or agent acting for Lessor. Lessor and Lessee agree and acknowledge that this document contains the entire agreement of the parties, that there are no verbal agreements, representations, warranties or other understandings affecting this Lease, and Lessor and Lessee, as a material part of the consideration of this Lease, waive all claims against the other for rescission, damages, or otherwise by reason of any alleged covenant, agreement or understanding not contained in this Lease. (k) Gender and Plurality In this Lease, the masculine gender includes both the feminine and neuter, and the singular number includes the plural whenever the context so requires. (1) Survival of Certain Covenants All covenants pertaining to bond, insurance, indemnification, restoration obligations, Breach, Default, and remedies shall survive the expiration or earlier termination of this Lease until Lessee has fulfilled all obligations to restore the Lease Premises as required by this Lease. (m) Counterparts This agreement may be executed in any number of counterparts and by different parties in separate counterparts. Each counterpart when so executed shall be deemed to be an original and all of which together shall constitute one and the same agreement. (n) Delegation of Authority Lessor and Lessee acknowledge Lessor as defined herein includes the Commission Members, their alternates or designees, and the staff of the Commission. The ability of staff of the Commission to give consent, or take other discretionary actions described herein will be as described in the then - current delegation of authority to Commission staff. All other powers are reserved to the Commission. Form51.16 (Rev. 10 /14) Page 16 of 17 Pages STATE OF CALIFORNIA - STATE LANDS COMMISSION LEASE NO. PRC 3792.1 This Lease shall become effective only when approved by and executed on behalf of the State Lands Commission of the State of California and a duly executed copy has been delivered to Lessee. The submission of this Lease by Lessor, its agent, or representative for examination by Lessee does not constitute an option or offer to lease the Lease Premises upon the terms and conditions contained herein, or a reservation of the Lease Premises in favor of Lessee. Lessee's submission of an executed copy of this Lease to Lessor shall constitute an offer to Lessor to lease the Lease Premises on the terms and conditions set forth herein. IN WITNESS WHEREOF, the parties hereto have executed this Lease as of the date hereafter affixed. LESSEE: CITY OF SEAL BEACH M Attest: i Jill R. Ingram, City Manager Robin L. Roberts, City Clerk Approved as to Form: C Craig A. Steele, City Attorney ATTACH NOTARY ACKNOWLEDGMENT LESSOR: STATE OF CALIFORNIA STATE LANDS COMMISSION C Robert Brian Bugsch Chief, Land Management Division Date: Execution of this document was authorized by the California State Lands Commission on Page 17 of 17 Pages (Month Day Year) Fo=51.16 (Rev. 10/14) EXHIBIT A PRC 3792.1 LAND DESCRIPTION A parcel of tide and submerged land, land situate in the bed of San Pedro Bay, lying adjacent to protracted Section 14, TSS, R12W, SBM as shown on the Official Township Plat, approved April 7, 1914, Orange County, State of California, and more particularly described as follows: COMMENCING at the southeast corner of Tract No. 1 in the City of Seal Beach, County of Orange, State of California, said corner being the intersection of the northeast line of Electric Avenue with the southern line of Seal Way as shown upon the map of said Tract No. 1, recorded in Book 9 of Miscellaneous Maps at Page 1, Orange County Records; thence continuing southwesterly along the southern line of Seal Way as shown on said map to a point which bears easterly along said line N 77 028'25" E 210.68 feet from the intersection of the southerly prolongation of the centerline of Neptune Avenue and the southern line of Seal Way, said point being the POINT OF BEGINNING; thence continuing westerly along the southern line of Seal Way as shown on said map to the westerly boundary of Tract No. 1; thence northwesterly from said point in a direct line 3,584.36 feet more or less to an intersection with the southwesterly prolongation of the centerline of Third Street in the City of Seal Beach as said street is shown upon the map of Tract No. 2, recorded in Book 9 of Miscellaneous Maps at Page 3, records of said county, at a point located 255.5 feet southwesterly from the southwest line of Ocean Blvd.; thence continuing northwesterly along the prolongation of the foregoing course 590.18 feet more or less to the intersection with the southwesterly prolongation of the southeasterly line of First Street (60 feet wide) as shown upon the map of Bay City, recorded in Book 3 of Miscellaneous Maps at Page 19; thence northeasterly along said line of First Street to a point distant 273.93 feet southwesterly from the southwest line of Ocean Blvd.; thence N 58054'W, 55.32 feet; thence N 22051'W, 366.64 feet; thence S 18 023'53" W, 124.63 feet; thence S 28 °25'47" W, 409.83 feet; thence S 31 034'48" W, 209.45 feet; thence S 26 °05'00" W, 274.99 feet; thence S 19 °00'57" W, 195.60 feet; thence S 03 007'08" W, 1177.32 feet; thence S 58 °43'00" E, 4428.06 feet more or less to an intersection with southwesterly prolongation of the initial course in the description of Parcel 2, as described in the Second Amended Complaint in Condemnation, No. 3436 -RJ Civil, United State of America, Plaintiff, vs. 4,783 acres of land, more or less, in Orange County, State of California, et al, filed in the District Court of the United States in and for the Southern District of California, Central Division; thence Paged I oft northeasterly along said southwesterly prolongation to the POINT OF BEGINNING. END OF DESCRIPTION Revised 7/05/16 by the California State Lands Commission Boundary Unit Revised description based on the {Parcel 1) description found in lease file PRC 2777.1 (W.O. 6568) executed June 22, 1976. Page 12 of 2 NU S0 \LF. SITE ,Fr; DETAIL I Sy`OR� IN � LEASE) AREA COMCRETi SHEET PILE GROIN NO SCALE av ;sra. Rta�9 SAN kDRO' J(f BAY 1/ SEAL BEACH 1,1 AIN IENANCE p.. STORAGE' YARD :3tr�� Op P Y 9 r \ a� ,\ C f 6+ �N iST Si• r.' PAMONG •,%PICVIC1 LOT RESTAt1RANT & RESTROOM DGTAILI i F _ _Z :f PRC 3792.1 in CITY OF SEAL BEACH GENERAL LEASE - 4�`'' PUBLIC AGENCY USE ORANGE COUNTY •1 MAP SOURCE: USGS QUAD This Exhibit is solely for purposes of generally defining the lease premises• is based on unverified information provided by the Lessee or other panies and is not intended to bc, nor shall it be construed as: a waiver or limitation of any State interest in the subject or any other property. PIER 4- q4-,o %! C� S; TOl < �I do J, S_Qq -0 NO SCALE av ;sra. Rta�9 SAN kDRO' J(f BAY 1/ SEAL BEACH 1,1 AIN IENANCE p.. STORAGE' YARD :3tr�� Op P Y 9 r \ a� ,\ C f 6+ �N iST Si• r.' PAMONG •,%PICVIC1 LOT RESTAt1RANT & RESTROOM DGTAILI i F _ _Z :f PRC 3792.1 in CITY OF SEAL BEACH GENERAL LEASE - 4�`'' PUBLIC AGENCY USE ORANGE COUNTY •1 MAP SOURCE: USGS QUAD This Exhibit is solely for purposes of generally defining the lease premises• is based on unverified information provided by the Lessee or other panies and is not intended to bc, nor shall it be construed as: a waiver or limitation of any State interest in the subject or any other property. EXHIBIT C -1 PRC 3792.1 SUBLEASE ENDORSEMENT STATE OF CALIFORNIA STATE LANDS COMMISSION Pursuant to Commission Minute Item No. dated, August 9, 2016, the herein sublease between, City of Seal Beach and DCOR, LLC, under a portion of State Lease PRC No. 3792.1, is hereby approved. r3'/I BRIAN BUGSCH, Chief Land Management Division EXHIBIT C -2 PRC 3792.1 SUBLEASE ENDORSEMENT STATE OF CALIFORNIA STATE LANDS COMMISSION Pursuant to Commission Minute Item No. dated, August 9, 2016, the herein sublease between, City of Seal Beach and SoCal Holdings, LLC, under a portion of State Lease PRC No. 3792.1, is hereby approved. BY: BRIAN BUGSCH, Chief Land Management Division EXHIBIT C -3 PRC 3792.1 SUBLEASE ENDORSEMENT STATE OF CALIFORNIA STATE LANDS COMMISSION Pursuant to Commission Minute Item No. dated, August 9, 2016, the herein sublease between, City of Seal Beach and Michael E. Balchin, dba River's End Cafe, under a portion of State Lease PRC No. 3792.1, is hereby approved. I:lvi BRIAN BUGSCH, Chief Land Management Division EXHIBIT C -4 PRC 3792.1 SUBLEASE ENDORSEMENT STATE OF CALIFORNIA STATE LANDS COMMISSION Pursuant to Commission Minute Item No. dated, August 9, 2016, the herein sublease between, City of Seal Beach and ABM Parking Services, under a portion of State Lease PRC No. 3792.1, is hereby approved. 11-YA BRIAN BUGSCH, Chief Land Management Division Attachment "C" a 12398 e ace 8345 : 376 EINOFFICIAL f6m* EST OF .QbT -T ntu - OF _ w.o. 6568 DS OF P.H.C. 3792.9 CALIF. LEASE Rsaida CITY OF SEAL BEACH . 3 FREE 4 Obis lease, made and entered into this _ 22nd _ day 5 of - June , 1967, by and between the STATE CF CALIFOH?IIA, herein - 6 after referred to as "State ", acting through the State Land's Commission and 7 pursuant to the authority contained in Division 6 of the Public Resources 8 Code and the rules and regulations adopted thereunder, and the City of Seal 9 Beach, hereinafter referred to as "Lessee ": 10 V T NES S_T H: 11 - WHEREAS, the City of Seal Beach hats heretofore entered into an 12 agreement with the State, acting by and through the State Lands Commission, 13 to fix the boundavy between the City-owned uplands and certain State tide 19 and submerged lands; and _ 15 WIMMAS, the City has constructed and is maintaining at its own 16 expense various structures end facilities which lie in whole or in part; upon 17 State lands; and 1B WHEREAS, the facilities and structures referred to hereiabefore are 19 for The purpose of enhancing the public use of the tide and submerged lands; 20 and 21 WHEREAS, it is'the intent of the City to devote all. of the State. 22 maned land and some of the City -owned lend in furtherance of the public tract 23 for commerce, navigation, and fisheries, and for the benefit of all of the 24 people of the State; 25 14011, THEREFORE, parties to this lease do hereby covenant end agree: 26 TEm 27 1. All existing Per or leases between the City of Seal Beach 'L$ and the State for eny lands or structures lying within the herein described . 29 leased premises are terminated. State does hereby lease, demise and let unto 30I Lessee for a term of 49 years, beginning dune 22, 1967�_i__ to 31I dune 22, 2016,. y (tailpa3 sootier terminated as hereinafter provided) -1- AIL .201 8/4 . - Sea /ixs�lCa�. 9,.. 74h esoF8345 ?%E377 1 those certain sovereign lends along the ocean front of rtbe Pacific Ocean in 2 the City of Seal Beach, situate in the County of Orange, State of California, 3 and more particularly described as follows: 4 Beginning at the southeast corner of Tract No. 1 in the City of Seal Beach, County of Orange, State of California, said corner being the 6 intersection of the northeast line of Electric Avenue with the southern line of Seal .Tay as shown upon the map of said Tract No. 1, recorded 6 in Book 9 of Ndscelleneous Maps at Page 1, Orange County Records; thence _continuing westerly along the southern line of Seal Way as shown upon 7 said map to the western boundary of Tract No. 1; thence northwesterly from said point in a direct line 3,584.36 feet more or less to an Inter - 6 - section with the southwesterly prolongation of the centerline of Third Street in the City of Seal Beach as said street is shown upon the map 9 of Tract No. 2, recorded in Book 9 of Miscellaneous Maps, records of said county, at a point located 255.5 feet southwesterly from the 10 southwest line of Ocean Blvd.; thence continuing northwesterly along - a prolongation of the foregoing course 590.18 feet more or less to 11 the intersection with southwesterly prolongation of the southeasterly line of First Street (60 feet wide) as shown upon the map of Bey City, 12 recorded in Book 3 of Miscellaneous Maps at pale 19; thence north - easterly along said line of First Street to e. poi.at- distant 273, 9j. 13 Peet eouthwesterl from the southwest line of Ocean Blvd.; thence . N• 58° 54' W.; 55-32 feet; N. 2.2' 51' W., 230 feet; thence N. 65° 00' _ 14 W., 120 feet; thence S. 31° 00' W,j 2,150 fees; thence S. 58° 43' E.,, to an Intersection with the southwesterly prccLongation of the Initial 15 course in the description of Parcel 2, as described in the S,.cond Amended Complaint In Condemnation, No, 3436 -RD Civil, United States 18 of America, Plaintiff, vs'. 4,783 acres of lam', more or less, in Orange County, State of California, at al., flied in the District 17 Court of the United States in and for the Soufaern District of California, Central. Division; thence northeasterly along said south - 18i westerly prolongation, and continuing along ssld- initial course to an intersection with the southwesterly extension of the first course in 19 the herein described parcel.; thence northeasterly along said extension 20 and along said first course to the point of beginning. Containing 238 acres, more or less. 21 Bearings used 'iy this description have the same basis as those shown 22 upon -the heretofore mentioned map of Bay City. 23 The initial course in the description'of said Parcel 2, Action No. 2: 3436 -RT Civil, is located as follows: 25 PARCEL 2 26 "That part of the bereinbefore mentioned Sect@ons 7, 81 91 12, 13, 14, and 24 in the Ranchos Los Alamitos and La Bolas Chica, bounded 27 and described as follows: 231 Commencing at a point that is 30 feet dialect from a monument consisting of a copper plug set in concrete, said distance of 29 30 feet being measured in a southeasterly direction at right angles to a line forming the center line of an existing rock -g0! jetty joining a certain thoroughfare namef Seal Way in the City Of Seal Beach, Csiifornia, said center line being a 31 straight line'extending fiom'the herelrab,fve mentioned -2- 1 2 g 4 5 6 BC9S8345 r;:GC378 monument, located near the southwesterly end of said jetty, to another similarly constructed monument near the north- easterly end of said Jetty; thence in a northeasterly direc- tion along a straight line which is 30 feet southeasterly of _ and parallel to the hereinabove described center line of said existing jetty to its intersection with the extension south - westerly of the southeasterly right- of -vay line of the afore- mentioned thoroughfare Seal Way, which is shown on Tract No. 1 of Miscellaneous Map Book 9, Page 1, in the Recorder's Office. of Orange County;..." 7 - COS]STDERATION: - - 8 ,- 2. The primary consideration for the granting of this lease shall 8 be the public benefit. The Lessee shall pay to the State any profit derived 10 from the operations hereinafter described pursuant to the provisions of 11 paragraph 8 hereof. 3.2 ASSIGNMENT AND SUBLETTING: 13 3. Lessee shall not assign this lease. Lessee shall furnish to 14 the State at the time of execution of this lease a list of all of the leases, 15 franchises, permits, or other agreements with any third persons who are 16 presently occupying any portion of the within described State lands. Nothing 17 herein, however, shall prohibit Lessee from entering into leases, subleases,. 18 franchises or permits or other agreements with third persons for the use of 19 limited areas of the leased premises herein described for the purposes set 20 forth in paragraph 8 herein, provided that such persons meet the requirements 21 and qualifications for lessees set forth in Division 6 of the Public Resources 22 Code and Title 2 of the Administrative Code. 23 RESERVATION OF THE STATE: 24 4. This lease is subject to any existing lease, permit, easement, 25 right -of -way or license for other purposes and State reserves the right 26 hereafter to lease, convey, or otherwise transfer or encumber such land or 27 any portion thereof for any or all purposes whatsoever not inconsistent or 26 incompatible with the rights or privileges granted to Lessee, including 29 without limiting the generalities of the foregoing, oil and gas and minerals. 30 State expressly reserves the right to grant easements, crhssings or rights- 31 of way, in, upon, over and under the leased premises, for any purpose without -3- 0 Boo,8345 YrtcE379 1 compensation to Lessee. 2 OPERATIONS, ALTERATIONS, AND WROVE MTS: 3 5. All activities sball be conducted in a good and workmanlike -¢ manner. Lessee shall maintain and keep in good sound repair all structures, 6 facilities or appurtenances upon the property. Lessee shall obtain any 6 necessary permits from any other public bodies having jurisdiction therein 7 and shall comply with all applicable laws, rules and regulations. Any 8 permanent structures erected upon the demised premises by Lessee shall, at 9 the option of the State, become the property of -the State of California upon 10 termination of this lease, or the State may require Lessee to remove all or 11 a portion of said structures. The State may require additional bond or 12 other security to assure that appropriate protective or remedial actions 13 will be taken to protect the State: - - -- lA LIABILITY: 16 6. Lessee agrees to indemnify and bold harmless the State, its 16 officers, •agents, and employees against any loss, damage, claim, demand or 17 action, caused by arising out of, or connected with the construction or 18 maintenance of structures upon, or the use by Lessee or its agents, sub - 19 lessees, permittees, or francbise holders, of the leased premises, whether 20 such liability arises by reason of the acts or omissions of•Lessee or its 21 agents or its contractors or its sublessees, permittees or franchise holders 22 during the term hereof, or sooner termination of this lease. At the option 23 of the State, Lessee shall procure and maintain liability Insurance for the 24 benefit of the State in an amount satisfactory to the State. The minimum 25 coverages shall be: - 26 Three Rundred Thousand Dollars ($300,000) for death or bodily 27 injury or loss sustained by any one person in any one occurrence; and Five Hundred Thousand Dollars ($500,000) for death or bodily _ 28 injury or loss sustained by more than ore person in any one occurrence; and „ 29 • Fifty Thousand Dollars ($50,000) for loss by damages or injury 30 to property in any one occurrence. 31 The State shall be named as an insured. A certificate of all required BmM45 �,+6e380 1 insurance shall be furnished to the State at the time of execution of this 2 lease. Continuation certificates shall be furnished at least 30 days prior 3 to the expiration of the then existing certificate. No such insurance shall 4 be cancelled without 30 days notice to the State. The policy shall either 6 contain a provision providing for a broad form of contractual liability, 6 including leases and permits, or there shall be attached thereto an endorse- 7 went providing for such coverage. Upon request the State shall be, entitled S to inspect the original policy of insurance or a photo copy thereof. The 9 procuring,of such policy of insurance shall not be construed to be a limits - 10 tion upon the Lessee's liability or as a full performance on its part of 11 the indemnification provisions of this pars graph, Lessee's obligations being, 12 notwithstanding said policy of insurance, for the full and total amount of 1s any damage, injury or loss caused by the negligence or other acts creating 3-4 liability for injury or damage connected with Lessee's or its sublessees', 16 permittees.', or franchise holders' use of the premises. The amount of 16 insurance as set forth herein may be increased at the option of the State, 17 ,upon 30 days notice to Lessee. 1S POLLUTION: 19 7. Lessee shall observe,and.comply with all rules and regulations 20 now promulgated by any agency or subdivision of the State of California having 21 jurisdiction therein and. such rules and regulations as may hereafter be 22 promulgated by any agency or subdivision of the State of California having 23 jurisdiction therein; and Lessee shall at all times take suitable precautions 24!- to prevent pollution and contamination of waters of the Pacific Oceon. 25 8. This lease shall be for the purposes and subject to the terms . 26 and conditions hereinafter set forth. 27 8.1 The leased premises shall be used for beaches, marine 28 parks, marinas, small boat harbors, bulkheads, piers, marine transportation ?.9 fabilities,.public utilities, earthfills, buildings, structures, recreational 30 £actlities, landscaping, parking lots, streets and'ioadways for public access 31 to.the leased premises, and related facilities for the benefit of the people -5- , eM � 8345 : +t; 381 i a 3 of the State, as opposed to a purely local benefit, and for the furtherance 2 of the public trust purposes of'commerce, navigation and fisheries. jR 3 8.2 Lessee shall submit to the State Lands Division, on or ;II, 4 before Se tember " p 30 of each year, a report of the utilization of the leased � 6 premises. Said report shall include: 6 (a) A description-of the uses to which the leased premises have lj 7 been placed during the period covered by the report. II " (b) A list of the owners and holders of sublessee, permits � 9 - and franchises granted by the Lessee, which list shall 10 specify as to each such owner ' or ho],der: 11 (i) The uses to which the premises have been placed by 32 - the owner or holder; 13 (11) The uses to which the premises shall be placed or may be by tbe-own. er or- holder,- pursuant to the - - ' 7.G terms contained in the sublease,, permit or franchise, 16 during the remaining period . of the sublease, permit 17 or franchise; 18 (iii) The consideration provided for in each sublease, .29�•- '• permit or franchise and the consideration actually 20 received by the Lessee for the sublease, permit or 21 franchise granted or issued; and+ - 22 (iv) An enumeration of the restrictions which the Lessee 23 has placed on the use of the premises and each area ' 24 .thereof for the period covered by the report. 26 (c) A statement as to the future plans of the Lessee for the use of 26 the leased premises, containing the following: 27 (1) Type of future development which is planned as to each 26 general area within the leased premises; 29 (11) Expected statewide benefit to be derived from the ' 30 „ development plan, including the financial. benefit ' 3] and the navigational; commerical or recreational benefit; �6= 5Coi8345 t,,ce382 1 (111) The proposed method of financing the plan, estimated 2 capital costs, annual operating costs, and annual g revenues of the plan. ¢ 8.3 Lessee shall establish a separate trust fund or funds for 5 the deposit of all revenue received from the leased premises. Nhere facil- 6 itips are located partially on the leased premises and partially on lands 7 owned by the City, the revenues and expenses attributable to said facility 6 shall be apportioned between City municipal funds and the aforementioned 9 trust fund or funds, based upon the percentage of the facility located on 10 the leased premises and the portion located on the lands owned by the City. 11 A statement of financial conditions and operations, to conform to the 12 requirements of the State Lands Division, shall be submitted to the Executive 13 Officer of the State Lands Division on or before September 30 of each year la for the preceding fiscal year. All money, if any, remaining in said fund or 15 funds, after the deduction of authorized expenses incurred, at the end of 16 the term of this lease shall be transferred to the State; provided, however, 17 that Lessee shall be entitled to a credit for any municipal funds advanced III , and expended for the purposes set forth in paragraph 8.0. In the event 19 uplands are acquired with trust funds, such lands shall become the property 20 - of the State at the end of the term of this lease. - 21 -8.4- The Lessee may use revenues accruing from or out of the 22 use of the leased premises for any or all of the following purposes which 23 are matters of statewide, as distinguished from local, interest and benefit: 24 (a) The construction, reconstruction, improvement, repair, opera - 2r, Lion, maintenance, promotion, and protection of works, lands, 26 and facilities necessary for the development of the leased 27 premises for the highest and best use in the public interest, 28 including, but not limited to, commerce, navigation, fisheries, 29 marinas, small boat harbors, marine stadiums, marine parka, $0t beaches, streets, roadways, earthfiLs,-bulkhgads, piers, 31� supporting s tructures,•buildings, recreational facilities, -7- 1 3 4 6 6 7 8 9 10 11 12 13 14 15 18 17 18 19 20 21 22 23 24 251 28I 27 28 29 so 31 scc::8345 r�GE383 i 6 landscaping, and parking lots situated upon the leased premises, or adjacent thereto and reasonably necessary to provide access to, or development and use of the leased premises; (b) The promotion, by advertising and such other means, as may ,Le reasonable and appropriate, of maximum use of the leased premises or to encourage private investment in development of the leased premises for the highest and best use in the statewide public interest; (c) Any other uses or purposes df state, as distinguished from purely local, interest and benefit, which are in fulfillment of those uses and purposes described in paragraph 8.1 hereof and which are approved in advance by the State Lands Commis- . ..__....._. ... lion; (d) The acquisition of property and the rendition of services reasonably necessary to the carrying out of the foregoing uses and purposes; - provided that as to any expenditure of revenue for any single capital .improvement involving an amount in- excess of fifty thousand dollars ($50,000) in the aggregate, the Lessee shall file with the State Lands Commission a detailed description of such capital improvement not less than 90 days prior to the time of any disbursement therefor or in connection therewith, excepting preliminary planning. Such description shall specify, in addition, the particular public interest and benefit, the provision of this lease authorizing the proposed expenditure and how the expendf tore complies with the Lessee's statement of future plans.. The State Lends Commission may, within 90 days after the time of such filing, determine and notify Lessee that such capital improvement is not in the statewide interest and benefit, or is not authorized by any of the provisions of this lease, or does not comply with the Lessee's future plans., In the event the State Lands Commission so notifies the Lessee that the capital improvement is not 0 Jl ss'c�,8345 r,e384 1 authorized, the Lessee shall not disburse any revenue for or in connection 2 with such capital improvement, unless and until the consent of the State 3 Lends Commission is obtained or a judicial determination has been made. 4 Failure of the State Lands Commission to make such a notification within the 6 90 -day period shall constitute approval by the State Lands Commission of the 6 proposed capital improvement. Any determination by the State Lands Commission 7 prior to the expiration of the - aforesaid 90 -day period, declaring that the 8 proposed capital improvement satisfies the criteria as" fort berein,shall 9 operate as the termination of the aforesaid 90 -day period. 10 8.5 Lessee agrees that, in its employment practices arising - 11 out of or connected with its operations under this lease, it shall not 12 discriminate against any individual because of race, color, ancestry, 13 .. national origin, or religion. _ 14 ENTRY BY - STATE: 15 9• State, through its authorized agents, shall have the right 1G at all reasonable times to go upon the leased premises for the purpose of 17 inspecting the same, or for the purpose of maintaining or repairing said 18 premises, or for the purpose of placing upon the property any usual or 19 ordinary signs, or for fire.or police purposes or to protect the premises 20 from any cause whatever, without any rebate of charges and without any 21 liability on the part, of'tbe State for any loss of occupation or quiet enjoy- 22 , ) - ment of the premises `therey occasioned. RESTORATION OF ' 23 PROPERTY: 10. Lessee will on the last day of the lease term or any exten- 24 sion thereof, or sooner termination of this lease, peaceably and quietly 2b leave, surrender and yield up to the State, all and singular, the lensed 2S premises is good order, condition and.repair, rea eonable use and wear thereof, 27 and damage by act of God or the elements excepted. Lessee, at the option of 28 the State, will immediately upon termination at his own expense and risk, 29 salvage and remove all structures erected by Lessee and restore the land as 30 nedrly as possible to the condition-existing at the .date of execution of this 31 lease, free o£ debris, and shall repair and restore any damage to the 1 -9- I! escs8345 etE38,gi, 1 improvements, if any, owned by the State resulting from either construction 2 or removal by Lessee or resulting from causes for which Lessee is liable under 3 this lease, and shall complete said removal and restoration within ninety (90) G days after termination of this lease. In the event that Lessee fails to com- b ply with this covenant, State may make such removal or restoration and Lessee 6 agrees to pay all of,the costs involved therein. - - 7 FORCE KuwER: - 8 - 11. It is understood that Lessee's obligations hereunder shall be 9 suspended during any period in which Lessee is prevented from complying - 10 therewith by acts of God, riots, acts of Federal or State agencies, or any 11 other cause beyond Lessee's reasonable control. 12 QUITCLAIM RECORDING: is _ "... 12, Upon the termination of the rights hereby granted, Lessee shell 1Q execute and deliver to Ststei within thirty (30) days after service of 15 written demand thereof, a good and sufficient quitclaim deed to the rights 16 arising bereunder. Should Lessee fail or refuse to deliver to the State a 17 quitclaim deed as aforesaid, a written notice by the State reciting the fail- ' 18 Pre or refusal of Lessee to execute and deliver said quitclaim deed as herein 19 provided, terminating.this lease, shall. after ten (10) days from the date of 20 recordation of said notice, be conclusive evidence against Lessee and all 21 persons claiming under Lessee of the termination of this lease. 22 NOIUCES: 23 13. All notices herein provided to be given shall be deemed to 2A have been fully given when made in writing and deposited in the United States 25 -mail, registered or certified and postage prepaid, addressed as follows: 26 To the State: 27 � State Lands CommS Ssion Roam 305,Califomia State Building 28 - 217 West First Street Los Angeles, California 90012 29 - To the Lessee: 30 'City of Seal Beach- . - 'City }tanager _ - 31 City Hall Seal Beach, California 90740 -10- • . - ess:.8345 r ±r,E 386 I VAIVER OF BREACH: 2 14. The waiver by the State of any breach of any term, covenant g or condition herein contained shall not be deemed to be a waiver of such g term, covenant or condition with respect to any subsequent breach of the 6 same or any other term, covenant of condition herein contained. The sub - g sequent acceptance of monies hereunder by the State shall not be deemed to 7 be a waiver of any preceding breach by Lessee of any term, covenant or con- e dition of this lease, other than the failure of Lessee to pay the particular 9 monies so accepted, regardless of the State's knowledge of such preceding 10 breach at the time of acceptance of such monies. 11 TMOUMTION OR - • , MODIFICATION: - - 12 15. This agreement may be terminated only by the mutual consent 13 of the parties hereto. No act or omission by either the State or Lessee 14 shall constitute a modification of this lease, It being understood by all 15 parties that this lease may be changed or otherwise modified only by written 1e' agreement of all parties. 17 SUCCESSORS; 18 16. The covenants and conditions herein contained shall, subject 19 'to the provisions as to assignment,. apply to and bind the heirs, successors, 20 executors, administrators end assigns of all of the parties hereto; end all 21 of the parties hereto shall be jointly and severally liable. hereunder. 22 TIME OF ESSENCE:. � . 25 17. Time is of the essence of this lease. M 1 2 3 ll if I2 •± o lE lE 17 18 li 2C 27 2£ 21 29 2E 2E 27 28 29 30 31 enr -.8345 race 387 CAPTIONS: 18. The captions in the margins of this lease are for convenience only and are not a part of this lease end do not in any way limit or amplify the terms and provisions of this lease. This agreement will become binding on the State only when duly executed by the Executive Officer of the State Lands Commission of the State of California. - - IN HITNESS WHEREOF, the parties hereto have executed this agreement Ali as of the date hereafter affixed. .,. LESSEE* STATE OF CALIFORNlA ?;..•.•..., y'• actingby -and through CITY OF OF SEAL BEACH STATE LANDS ca,24ISSIOP l''•1 By Addr s , S. HORT . s - • ♦ ti t Executive 0 er 't ' LEE RISNER� City Manager D e of Signature �7�J 46 (/Date oP 6 igsatu/ r7 e •Ciiy Seal shall be affixed ' and a certified copy of the -12- City Council resolution authorizing execution shall be attached. • .- e�c:;8345 •r „ce388 I STATE OF CALIFORNIA ) sa: . - .. 2 COUNTY OF LOS ANGELES) - - • 3 Oa /0 1967, before me, the nnde37&kgned, a- Notary Public , in - d for aid State, with principal office in 4 County, pbfso y E appeared F. S. AORTIC, known to me to be the cutive Officer of the STATE LANDS COWaSSION, STATE OF CALIFORNIA, the mmission 5 that executed the within instrument, known to me to be the person who executed the within Instrument on behalf of the Commission therein named, - - 6 and acknowledged to me that such. Commission executed the within Instrumert pursuant to a resolution of its Commissioners. - - 7 IN WMTESS. WHEREOF, I have hereunto set my hand and affixed my official. 8 seal on the day and year in this certificate first above written. 9 10 OFFICIAL SEAL or the County MYRTLE STRATTON Notary R in and- 11 • NOTARY PUBLIC. CALIFORNIA of Los An es, State of California PRINCIPAL OFFICE IN - 12 LOB ANOELEE COUNTY My Commle3 on Expires Oct 90, 1910 IS 14 STATE OF CALIFORNIA) as: 15 COUNTY OF ORANGE ) _ 16 p,y •-e— 1967, before me, the undersigned, a Notary Public in a for the County of Orange, State of California, personally 17 appeared LEE RISNER, known to me to be the City Manager of the CITY OF 18 SEAS. BEACH, end known to me to be the person who executed the within. Instrument on behalf of said City of Seal Beach, and acknowledged to me 'that said municipal corporation executed the within Instrument pursuant to 19 its Charter, Resolutions, Ordinances and applicable State law. 20 IN WITNESS WHERn"Y.`Fi I have hereunto set my hand and affixed my official seal on the day and year in this certificate first above written. 21 22 1 25tX'hr� - �. Notary Public in and for the County ,:•:. • OFFICIAL SEAL OY Orange, State Of California ;LbWTjA L THOMAS 2g pTA (Y PUBLIC- CAL FORMA ; LOLITA L. THOMAS INCIPAL OPr1 E IN My COmmisp00 2¢' ORANGE COUNTY P 12, 1969 27 28 29 30 31 =13- - RESOLUTION NO.1�_r� • MD-8345 r; +.«389 CEF'11FIED► f;(i?��' A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEAL BEACH, CALIFORNIA, A CHARTER CITY, AUTHORIZ- ING THE CITY MANAGER TO EXECUTE ON BEHALF OF THE CITY OF SEAL BEACH A LEASE WITH THE STATE OF CALIFORNIA FOR USE OF CERTAIN STATE -OWNED TIDE AND SUBMERGED LANDS WITH THE CITY`S CORPORATE BOUNDARIES, WHEREAS, the City of Seal Beach has, at its own expense, constructed and maintained facilities and structures which lie in whole, or in part, on State lands which structures and facilities are for the purpose of enhancing the public use of tide and submerged lands for the benefit of all the people of the State of California; and WHEREAS, the primary consideration for the granting of a lease is the public, interest; and WHEREAS, it is the intent of the City to devote all of the leased State lands in furtherance of the public trust for commerce, navigation, fisheries and for the public benefit of State citizens; and WHEREAS, certain leases and permits granted by the State of California to the City of Seal Beach for facilities and structures which protect state and city property will expire in the near future; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SEAL BEACH, CALIFORNIA, a municipal corporation and a charter city, does hereby resolve as follows; Section 1. The City Manager is authorized to execute on behalf of the City of Seal Beach.a. lease by and between the State of California, acting through the State Lands Cosnission, and the City of Seal Beach for certain State -owned lands described generally as follows: Beginning at the southeast corner of Tract No. I in the City of Seal Beach, County of Orange, State of California, said corner being the intersection of the northeast line of Electric Avenue with the southern line of Seal Way as shown.upon the map of said Tract No. 1, recorded in Book 9 of Miscellaneous Maps at Page 1,Orange County Records; thence continuing westerly along the southern line of Seal Way as shown upon said map to the western boundary of Tract No. 1; thence northwesterly from said point in a direct line 3,584.36 feet more or less to an intersection with the southwesterly prolongation of the centerline of Third Street in the City of Seal Beach as said street is shown upon the map of . Tract No. 2, recorded in Book 9 of Miscellaneous Maps, records of said county,'at a point located 255.5 feet southwesterly from the south- west line of Ocean Blvd.; thence continuing northwesterly along a prolongation of the foregoing course 590.18 feet more or less to the intersection with southwesterly prolongation of the southeasterly line of Firsr Street (60 feet wide) as shown upon the map of Bay City, recorded in Book 3 of Miscellaneous Maps at page 19; thence northeasterly along said line of First Street to a point distant 273.93 feet south- westerly from the southwest line of Ocean Blvd.; thence N. 580 541x,7., asc .8345 r. +se 390 . 55.32 feet; N. 220 51'W.,230 feet; thence N. 650 00' W., 120 feet; thence S 310 00'W., 2,150 feet; thence S. 580 43' E., to an intersection with the southwesterly prolongation of the initial course in the des - cription.of Parcel 2, as described in the Second Amended Complaint in Condemnation, No. 3436,R3 Civil, United States of America, Plaintiff, vs. 4,783 acres of land, more or less, in Orange County, State of California, at al, filed in the District Court of the United States in and for the Southern District of California, Central, A Division; thence northeasterly along said southwesterly prolongation, and continuing along said initial course to an intersection with the southwesterly extension of the first course in the herein described parcel; thence northeasterly along said extension and along said first course to the point of beginning. Containing 238 acres, more or less. Bearings used in this description have the same basis as those shown upon the heretofore mentioned map of Bay City. The initial course in the description of said Parcel 2, Action No. 3436- RJ.Civil, is located as follows: PARCEL 2 "That part of the hereinbefore - mentioned Sections 7, 8, 9, 12, 13, 14, and 24 in the Rancho's Los Alamitos and La Bolas Chica, bounded and described as follows: Commencing at a point that is 30 feet distant from a monument consisting of a copper plug set in concrete, said distance of 30 feet being measured in a southeasterly direction at right angles to a line forming the center line of an existing rock jetty joining a certain tboraughfare named Seal Way in the City of Seal Beach, California, said center line being a straight line extending from the hereinabove- mentioned monument, located near the southwesterly end of said jetty, to another similarly constructed monument near the northeasterly end of said jetty; thence in a northeasterly direction along a straight line which is 30 feet southeasterly of and parallel to the herein - above described center line of said existing jetty to its intersection with the extension southwesterly of the southeasterly right -of -way . line of the aforementioned thoroughfare Seal Way, which is shown on Tract No. 1 of Miscellaneous Map Book 9, Page 1, in the Recorder's Office of Orange County: ..." _ PASSED, APPROVED, AND ADOPTED by the City Council gf the City.of Seal Beach at a meeting thereof held on the S-!c- day of 1967. ' r ATTEST: ,�• Ltd ��� l�l [s City Clerk STATE OF CALIFORNIA ) - COUNTY OF ORANGE ) SS CITY OF SEAL BEACH ) I, F. W. Hickman, City Clerk and ex- officio clerk of the City Council, hereby certify that the foregoing resolution was passed, approved, and adopted by the-City Council of the City of Seal Beach at a meet- ing thereof held on. the 6rc'7. day of [(p_ 1967, by the following vote: y AYES: Councilmeni[- 91:try L02C� r�Jv ux[t NOES: Councilmen ";PlC -t _ _ ABSENT: Councilmen [(��£,ly�e.' srs,y,��'C' ' - City Clerk �l� ill RESOLUTTON NO. 0 KO; 8345 Pt-4392 OFATPHO CDP t A RESOLUTION OF THE CT.TY COUNCIL OF THE CITY OF SEAL BEACH, CALIFORNIA. A CILARTER CITY, AUTHORIZ- ING AND DIRECTING THE RECORDATION OF A LEASE BETWEEN THE CITY OF SEAL BEACH AND THE STATE, OF CALIFORNIA FOR USE OF CERTAIN STATE -OWNED TIDE AND SUBMERGED LANDS. WHEREAS, the City of Seal Beach, by Resolution Nud'er 1556, adopted on June 5, 1967, authorized the execution of a lease between the City of Seal Beach and the State of California for use of certain state -owned tide and submerged lands within the City's corporate boundaries; NOW, THEREFORE, be it resolved by the City Conneil of the City of Seal Beach as follows -- Section 1. The City Clerk of the City of Seal. Beach is hereby authorized and directed to record with the County Recorder of Orange County the TIDEL-.'�PT.DS LEASE dated July 10, 1907, and authorized by Resolution Number 1556. PASSED, APPROVED, AND ADOPTED by the City Council of the City of Seal Beach at a meeting thereof held on the 7th day of August, 1967, by the following vote: AYES: NOES: ABSENT: ATTEST: City Clerk Councilmen Councilmen Councilmen. /',� %/ ice. /� �'�/•.�_ � ��.?'n�;/2i Attachment "®" A 72 S 34 CALENDAR ITEM C28 GENERAL LEASE — PUBLIC AGENCY USE AND ENDORSEMENT OF SUBLEASES APPLICANT /SUBLESSOR: City of Seal Beach SUBLESSEES: DCOR, LLC SoCal Holdings, LLC Michael E. Balchin ABM Parking Services 08/09/16 PRC 3792.1 R. Collins PROPOSED LEASE: AREA, LAND TYPE, AND LOCATION: Sovereign land in the Pacific Ocean, in the City of Seal Beach, Orange County. AUTHORIZED USE: Use and maintenance of an existing pier with a lifeguard tower, 750 -foot- long concrete sheet pile groin, maintenance building, storage building, restaurant, public restroom, picnic area, raised planter areas with retaining walls, three parking lots, and a tot lot with a perimeter wall; the construction, use, and maintenance of a seasonal flood control berm to prevent beach run -up during winter months; beach nourishment; and the seasonal placement, use, and maintenance of temporary lifeguard stations. LEASE TERM: 30 years, beginning June 22, 2016. CONSIDERATION: Annual rent in the amount of $59,594, with rent review conducted on the 10th and 201h anniversary of the lease, upon any extension or amendment of an existing sublease, or upon execution of a new sublease, as specified in the lease. -1- Revised 08/05/16 CALENDAR ITEM NO. C28 (CONT'D) SPECIFIC LEASE PROVISIONS: Insurance: Liability insurance in an amount no less than $5,000,000. Sublesees: Commercial General Liability insurance in an amount no less than $1,000,000. SUBLEASE: DCOR, LLC AUTHORIZED USE: Use of the parking lot and boat landing from the pier. SUBLEASE TERM: Month -to- month. SUBLEASE: SoCal Holdings, LLC AUTHORIZED USE: Use of the parking lot and boat landing from the pier. SUBLEASE TERM: Five years, ending February 10, 2018. SUBLEASE: Michael E. Balchin AUTHORIZED USE: Use and maintenance of the River's End Cafe and a public restroom on West Beach. SUBLEASE TERM: Five years, ending April 30, 2017. SUBLEASE: ABM Parking Services AUTHORIZED USE: Management and operation of three public parking lots. SUBLEASE TERM: Month -to- month. STAFF ANALYSIS AND RECOMMENDATION: Authority: Public Resources Code sections 6005, 6216, 6301, 6503.5; California Code of Regulations, title 2, section 2000, subdivision (b). -2- Revised 08/05/16 CALENDAR ITEM NO. C28 (CONT'D) Public Trust and State's Best Interests Analysis: On June 22, 1967, the Commission authorized a 49 -year General Lease — Public Agency Use to the City of Seal Beach (City) for an existing pier, parking lots, 67 /Items /062267C43.pdf, and other related facilities. The lease expired on June 21, 2016, and the City is now applying for a new lease. The nearly mile -long public beach is divided into two segments by a 750 - foot -long concrete sheet pile groin immediately west of the pier. The west segment of the beach (West Beach) is 2,600 feet long and varies in width from 1,200 feet on the west end near the San Gabriel River to 250 feet adjacent to the groin. The east segment of the beach (East Beach) is 2,400 feet long and varies in width from 500 feet adjacent to the groin to as little as 100 feet in width at Dolphin Street before becoming 500 feet wide at the far east end of the beach adjacent to the Anaheim Bay west jetty. Every summer the City places and provides staffing for temporary lifeguard stations evenly spaced along the entire beach frontage. Originally built in 1906 with a length of 1,865 feet, the Seal Beach pier is the second longest wooden pier in California. The pier, with a lifeguard tower, is currently used for sightseeing and fishing. It is also a shuttle pick- up /drop -off point for several oil companies' employees, equipment, and supplies to offshore oil platforms and petroleum producing islands. On May 20, 2016, a fire broke out on the Seal Beach pier causing extensive structural damage to the pier and destroying a vacant restaurant and bait shop at the end of the pier. The pier was subsequently closed to the public for health and safety reasons and remains closed. The City has taken emergency action to assess damage and initiate expeditious demolition and repair of the damaged pier. Repair of the structure will only involve like- for -like replacement of damaged stringers, cross braces, melted and distorted pile wraps, decking, and lighting appurtenances and is considered to be required maintenance under the terms of the lease. The initial goal is to reopen the pier to the public, with replacement of the restaurant to occur at a later date. The City has requested a 30 -year lease term in order to allow prospective restaurant operators to secure long -term financing to rebuild the restaurant. After the City secures a restaurant operator, the City will be -3- Revised 08/05/16 CALENDAR ITEM NO. C28 (CONT'D) required to submit an application to the Commission to amend the lease to authorize the construction and use of the restaurant on the pier. The City has entered into four subleases on the lease premises. Two subleases, to DCOR, LLC and SoCal Holdings, LLC, provide unassigned parking within the parking lots to employees and provide shuttle access to the pier. The third sublease is for the operation and maintenance of the River's End Cafe on West Beach near the mouth of the San Gabriel River, and the fourth sublease is to ABM Parking Services for the management and operation of the three parking lots. The City maintains three paid public parking lots on the lease premises. The 1 st Street parking lot located at the west end of West Beach near the San Gabriel River is entirely on sovereign land and 34 percent of the 8th and 10th Street parking lots straddling the pier occupy sovereign land. The City uses a maintenance building and a storage building located on sovereign land adjacent to the San Gabriel River immediately north of the 1st Street parking lot. Maintenance activities consist of pier maintenance, including decking replacement, parking lot maintenance, beach erosion control, and collection of garbage from waste collection receptacles maintained on the pier, in park areas, parking lots, restrooms, and on the beach. The River's End Cafe, picnic area, and a public restroom occupy sovereign land on West Beach adjacent to the San Gabriel River. The River's End Cafe is styled as a tropical beach patio restaurant, serving American, Southern, Central- American, Caribbean, and Mexican dishes, served indoors or from a beach -side patio. The picnic area provides concrete tables and a grassy area adjacent to the beach and public restroom. A portion of a tot lot/beachside playground is located on sovereign land between the pier and the 10th Street parking lot on East Beach. The playground is bordered by a wide sandy beach, has recently been updated with new equipment, and is ADA compliant. The playground serves as a visitor - serving and visitor - attracting amenity to the beach, pier, and other public spaces. Seal Beach is a popular destination in Southern California and the public beach and pier play an integral part in attracting visitors for ocean - related ,q f -4- Revised 08/05/16 CALENDAR ITEM NO. CZ$ (CONT'D) recreation, fishing, and sightseeing purposes. The flat beach and pier structure provide sufficient space for both the pier and other Public Trust consistent activities. The location and structure of the pier allow the public to walk or navigate under or around the pier for continuous access within the Public Trust land. The pier promotes the fundamental right of the public to use tide and submerged lands to engage in commerce, navigation, and fisheries. The lease area, consisting of public beaches (East and West), the public pier, and the seasonal berm on the East Beach, may be vulnerable to sea - level rise within the 30 -year term of the lease. The lease area is bounded on the east end by a jetty that separates Seal Beach from Anaheim Bay and on the west end by a series of jetties and the channelized outflow of the San Gabriel River. It is bisected by the public pier and another smaller groin underneath the pier. These structures exert an artificial influence on the littoral cell sand transport system, resulting in an annual accretion of sand on the West Beach and a depletion of sand on the East Beach. The region is projected to experience up to 2 feet of sea -level rise by 2050 (National Research Council 2012). Additional climate change impacts such as more frequent and stronger winter storm and flooding events may contribute to increased vulnerability throughout the lease area. These cumulative impacts may result in accelerated rates of erosion and beach loss. Under the proposed lease, the City will continue to construct a 20 -foot tall sand berm along East Beach annually, using sand that has accreted on the West Beach. The berm is constructed in the winter to protect upland property, including private residential property, from storm activity. In addition to the berm, beach nourishment is scheduled for the East Beach every 2 years, also using sand that has accumulated on the West Beach. Over the proposed 30 -year lease term, sea levels will continue to rise and storm impacts are likely to increase, potentially increasing the risk to Public Trust resources and values located within and around the lease area, including recreational values associated with the beach, public parking lots, the pier, and public restrooms located underneath the pier. The West Beach is prone to flooding due to its proximity to the San Gabriel River mouth. Increased flooding events in the future could limit the sand supply from the West Beach due to scouring, impacting the East Beach berm by decreasing the amount of available sand for construction. The berm is located on the most erodible section of the beach, and could -5- Revised 08/05/16 CALENDAR ITEM NO. C28 (CONT'D) be subject to increased wave action over time. Rising sea levels could impact access to and the functionality of the public parking lots and tot lot located near the pier, as these constitute the most vulnerable structures within the lease area. The combination of sea -level rise, increased wave activity, more frequent storm events, and changing erosion rates could necessitate additional beach nourishment, construction of a higher berm, or other adaptation strategies. Relatively small changes in sea level (roughly 25 centimeters or about 93/4 inches) can greatly increase the level of exposure for flood control berms and may require added nourishments to maintain protection (Gallien et al. 2015). The lease includes several provisions intended to inform Commission staff and the City of potential impacts from sea -level rise and recognize the need for adaptive measures to address such impacts over the term of the lease. For example, the lease requires the Lessee to provide annual reports on berm construction, including berm dimensions, sand volume, and source sites for the materials to gauge if the berm is increasing in size over time and where possible future impacts may occur if materials are sourced from locations other than the West Beach area. The required annual report will also include any local monitoring information required by permitting agencies relating to sea -level rise vulnerability, structural integrity, and adaptation capacity of the lease area and associated improvements, including sea -level rise and flooding vulnerability and risk assessments; annual flooding frequency and extent; annual site photos; details on repair and maintenance operations; and coastal hazard remediation and removal. In addition, through the terms of the lease the City acknowledges the presence of potential hazards from climate change effects including sea -level rise that may affect the lease area. The City also acknowledges that it, may be required to implement adaptive measures in the future to address adverse impacts resulting from climate change and sea level rise to structures and other improvements and to evaluate the effectiveness of the berm in protecting those improvements and other City infrastructure. As a long -term measure, the City is required to submit a summary report, five years before the end of the lease, of information obtained over the lease term to provide a comprehensive account of resiliency planning efforts and adaptive strategies for sea -level rise impacts to assess effectiveness. The summary report will also include a consolidation of information from all prior annual reports to help Commission staff and the -6- Revised 08/05/16 CALENDAR ITEM NO. Ci28 (CONT'D) City identify trends and possible future impacts that may occur toward the end of the lease term and beyond. The proposed lease requires the City to insure the lease premises and indemnify the State. The lease also requires the payment of annual rent based on a percentage of the City's gross income from the parking, pier and restaurant. The authorized uses promote water - related public use of Public Trust land and provide a variety of visitor serving amenities to help the public access and enjoy the lands. For all the reasons above, Commission staff believes the issuance of this lease is consistent with the common law Public Trust Doctrine, will not substantially interfere with Public Trust needs at this location, at this time, and for the foreseeable term of the proposed lease, and is in the best interests of the State. OTHER PERTINENT INFORMATION: 1. This action is consistent with Strategy 1.1 of the Commission's Strategic Plan to deliver the highest levels of public health and safety in the protection, preservation, and responsible economic use of the lands and resources under the Commission's jurisdiction, Strategy 1.2 provide consistency with evolving Public Trust principles and values and Strategy 1.3 to promote, expand, and enhance appropriate public use and access to and along the State's inland and coastal waterways. Staff recommends that the Commission find that this activity is exempt from the requirements of CEQA as a categorically exempt project. The project is exempt under Class 1, Existing Facilities; California Code of Regulations, title 2, section 2905, subdivision (a)(2). Authority: Public Resources Code section 21084 and California Code of Regulations, title 14, section 15300 and California Code of Regulations, title 2, section 2905. This activity involves lands identified as possessing significant environmental values pursuant to Public Resources Code section 6370 et seq., but such activity will not affect those significant lands. Based upon staff's consultation with the persons nominating such lands and through the CEQA review process, it is staff's opinion that the project, as proposed, is consistent with its use classification. -7- Revised 08/05/16 CALENDAR ITEM NO. C28 (CONT'D) APPROVALS OBTAINED: U.S. Army Corps of Engineers FURTHER APPROVALS REQUIRED: California Coastal Commission EXHIBITS: A. Land Description B. Site and Location Map RECOMMENDED ACTION: It is recommended that the Commission: CEQA FINDING: Find that the activity is exempt from the requirements of CEQA pursuant to California Code of Regulations, title 14, section 15061 as a categorically exempt project, Class 1, Existing Facilities; California Code of Regulations, title 2, section 2905, subdivision (a)(2). PUBLIC TRUST AND STATE'S BEST INTERESTS: Find that the proposed lease will not substantially interfere with the Public Trust needs and values at this location at this time, and for the foreseeable term of the proposed lease, and is consistent with the common law Public Trust Doctrine, and is in the best interests of the State. SIGNIFICANT LANDS INVENTORY FINDING: Find that this activity is consistent with the use classification designated by the Commission for the land pursuant to Public Resources Code section 6370 et seq. AUTHORIZATION: 1. Authorize issuance of a General Lease — Public Agency Use to the City of Seal Beach beginning June 22, 2016, for a term of 30 years, for use and maintenance of an existing pier with a lifeguard tower, 750 -foot long concrete sheet pile groin, maintenance building, storage building, restaurant, public restroom, picnic area, raised planter areas with retaining walls, three parking lots, and a tot lot with a perimeter wall; the construction, use, and maintenance of a seasonal flood control berm to prevent beach run -up during winter months; beach nourishment; and the seasonal placement, use, and -8- Revised 08/05/16 CALENDAR ITEM NO. C2$ (CONT'D) maintenance of temporary lifeguard stations; as described in Exhibit A and as shown on Exhibit B (for reference purposes only) attached and by this reference made a part hereof; annual rent in the amount of $59,594, with rent reviews conducted on the 10th and 20th anniversary of the lease, upon any extension or amendment of an existing sublease, or upon execution of a new sublease, as provided in the lease; and liability insurance in an amount no less than $5,000,000 per occurrence. Authorize by endorsement an existing sublease from the City of Seal Beach to DCOR, LLC, of a portion of Lease No. PRC 3792.1, with a month -to -month tenancy. Authorize by endorsement an existing sublease from the City of Seal Beach to SoCal Holdings, LLC, of a portion of Lease No. PRC 3792.1, with a five -year term, expiring on February 10, 2018. Authorize by endorsement an existing sublease from the City of Seal Beach to Michael E. Balchin, of a portion of Lease No. PRC 3792.1, with a five -year term, expiring on April 30, 2017. Authorize by endorsement an existing sublease from the City of Seal Beach to ABM Parking Services, of a portion of Lease No. PRC 3792.1, with a month -to -month tenancy. -9- Revised 08/05/16 EXHIBIT A PRC 3792.1 LAND DESCRIPTION A parcel of tide and submerged land, land situate in the bed of San Pedro Bay, lying adjacent to protracted Section 14, TSS, R12W, SBM as shown on the Official Township Plat, approved April 7, 1914, Orange County, State of California, and more particularly described as follows: COMMENCING at the southeast corner of Tract No. 1 in the City of Seal Beach, County of Orange, State of California, said corner being the intersection of the northeast line of Electric Avenue with the southern line of Seal Way as shown upon the map of said Tract No. 1, recorded in Book 9 of Miscellaneous Maps at Page 1, Orange County Records; thence continuing southwesterly along the southern line of Seal Way as shown on said map to a point which bears easterly along said line N 77 028'25" E 210.68 feet from the intersection of the southerly prolongation of the centerline of Neptune Avenue and the southern line of Seal Way, said point being the POINT OF BEGINNING; thence continuing westerly along the southern line of Seal Way as shown on said map to the westerly boundary of Tract No. 1; thence northwesterly from said point in a direct line 3,584.36 feet more or less to an intersection with the southwesterly prolongation of the centerline of Third Street in the City of Seal Beach as said street is shown upon the map of Tract No. 2, recorded in Book 9 of Miscellaneous Maps at Page 3, records of said county, at a point located 255.5 feet southwesterly from the southwest line of Ocean Blvd.; thence continuing northwesterly along the prolongation of the foregoing course 590.18 feet more or less to the intersection with the southwesterly prolongation of the southeasterly line of First Street (60 feet wide) as shown upon the map of Bay City, recorded in Book 3 of Miscellaneous Maps at Page 19; thence northeasterly along said line of First Street to a point distant 273.93 feet southwesterly from the southwest line of Ocean Blvd.; thence N 58054'W, 55.32 feet; thence N 22051'W, 366.64 feet; thence S 18 023'53" W, 124.63 feet; thence S 28 025'47" W, 409.83 feet; thence S 31 034'48" W, 209.45 feet; thence S 26 °05'00" W, 274.99 feet; thence S 19 000'57" W, 195.60 feet; thence S 03 °07'08" W, 1177.32 feet; thence S 58 043'00" E, 4428.06 feet more or less to an intersection with southwesterly prolongation of the initial course in the description of Parcel 2, as described in the Second Amended Complaint in Condemnation, No. 3436 -RJ Civil, United State of America, Plaintiff, vs. 4,783 acres of land, more or less, in Orange County, State of California, et al, filed in the District Court of the United States in and for the Southern District of California, Central Division; thence Page I 1 of 2 northeasterly along said southwesterly prolongation to the POINT OF BEGINNING. END OF DESCRIPTION Revised 7/05/16 by the California State Lands Commission Boundary Unit Revised description based on the {Parcel 1) description found in lease file PRC 2777.1 (W.O. 6568) executed June 22, 1976. Page 12 of 2 NO SCALE SITE L I.4AINTENANCE p k tiTORACE y Z YARD o N \Otk EE DETAIL 1 00. Vi APP \ Up \\ ;� \ _ Sy` Rpf ORe�!>ti PARIKI c �' LEASE .1 - PICNIC, LOT = :,A —REA- ,- L,: -_' RESTAURANT AREA COMCREiE 3- RESTROOM UErAILI SHEET PILE - GROIN \ / PIER .90 44, <g10D', �aT E �✓ UC SEAL BEACH NO SCALE LOCATION Exhibit.B PRC 3792J SCnL 1 �,iCI Y,x t CITY OF SEAL BEACH ! } p �- •. r _.V i �(w•4•c GENERAL LEASE - PUBLIC AGENCY USE I ,,.f -i , ; i, ORANGE COUNTY xsa.4fl] /r`t'?41 SANkDRO .. •.`z '' j: _ I� T�� BAY. LI V ; ��r •,�''ll�ti, � r1 f � 'L� NIAP SOURCE: USGS QUAD This F.xhibit is solely,for purposes of generally defining the lease premises, is based on unverified information provided by the Lessee or other p:mies and is not intended to be. nor shall it be construed as: a waiver or limitation of any State interest in the subject or any other property. SITE 1111' 70116