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HomeMy WebLinkAboutCC 2025-09-23_09g Lease Agreement for Public Parking_MankinsItem 9.g. MEMORANDUM TO: City Council FROM: Brian Pedrotti, Director of Community Development SUBJECT: Lease Agreement for Public Parking Area DATE: September 23, 2025 RECOMMENDATION: 1) Adopt a Resolution authorizing the City Manager to execute a Lease Agreement with Blair B. Mankins and DeAnne P. Mankins, Trustees of the Blair and DeAnne Mankins Revocable Trust and Mark Mankins, Trustee of the 2M Trust for the lease of certain parking areas on the north side of East Branch Street for public off -street parking, subject to any minor, technical, or non-substantive changes as approved by the City Manager in consultation with the City Attorney; and 2) Find that adopting the Resolution is not a project subject to the California Environmental Quality Act (“CEQA”) because approval of a lease agreement for public parking does not in itself have potential to result in either a direct, or reasonably foreseeable indirect, physical change to the environment. (State CEQA Guidelines, §§ 15060(c)(2) and 15061(b)(3).) IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: The lease requires the City to pay one dollar ($1.00) per month for the five-year term, which will be paid in a lump sum upon execution of the lease agreement. The City is also obligated to pay or reimburse the Mankins Family Trust for the property taxes, currently $4,500 per year, and to maintain the property. Maintenance costs vary annually. All costs associated with the lease are paid from the Downtown Parking Fund. Revenues for this fund are collected through an additional business license tax for businesses within the Parking Business Improvement Area (generally the Village area) and total approximate ly $11,000 per year. These funds are designated for parking-related costs. BACKGROUND: The City currently leases two private property parcels for off -street parking lots on the north side of East Branch Street. These two properties are described as follows:  A portion of the Car Corral owned by David Family Trust ; and  The westerly portion of the Le Point Street parking lot which is owned by the Mankins Family Trust. Page 98 of 169 Item 9.g. City Council Lease Agreement for Public Parking Area September 23, 2025 Page 2 The current lease for the Le Point Street lot, owned by the Mankins Family Trust, expired on November 30, 2021. ANALYSIS OF ISSUES: The terms and conditions of the proposed five (5) year lease are similar to the previous lease. The lease contains similar terms and conditions as the current lease and has been reviewed by the City Attorney. The City’s contracted street sweeping firm will sweep the parking lot and the walkway monthly. City staff will conduct litter removal in the parking lot and the walkway weekly. Representatives of the Mankins Family Trust have agreed to renewal of the lease. If approved, the lease will become effective on October 1, 2025, and expire on September 30, 2030. The lease can be terminated by either party upon thirty (30) days p rior written notice. ALTERNATIVES: The following alternatives are provided for the Council’s consideration: 1. Approve and authorize the City Manager or designee to execute a Lease Agreement between the City and Blair B. Mankins and DeAnne P. Mankins, Trustees of the Blair and DeAnne Mankins Revocable Trust and Mark Mankins, Trustee of the 2M Trust for the lease of certain parking areas on the north side of East Branch Street for public off-street parking, subject to any minor, technical, or non-substantive changes as approved by the City Manager in consultation with the City Attorney; 2. Direct staff to renegotiate changes to the conditions of the lease; or 3. Provide other direction to staff. ADVANTAGES: The agreement extends the term of the lease for an additional five years, providing the public with connected and additional parking at the Le Point Street parking lot at a minimal cost. DISADVANTAGES: No disadvantages have been identified. ENVIRONMENTAL REVIEW: The proposed action is exempt from the California Environmental Quality Act (“CEQA”) pursuant to State CEQA Guidelines sections 15060(c)(2) and 15061(b)(3) because it will not result in a direct or reasonably foreseeable physical change in the environment; and the activity is covered by the general rule that CEQA applies only to projects which have the potential for causing a significant effect on the environment. The proposed action would only establish a new lease of public off-street parking, which is not an authorization for any development or construction. Thus, it can be seen with certainty that there is no Page 99 of 169 Item 9.g. City Council Lease Agreement for Public Parking Area September 23, 2025 Page 3 possibility that the activity may have a significant effect on the environment, the activity is not subject to CEQA. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall an d on the City’s website in accordance with Government Code Section 54954.2. ATTACHMENTS: 1. Resolution Page 100 of 169 ATTACHMENT 1 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE AUTHORIZING THE CITY MANAGER TO EXECUTE A LEASE AGREEMENT WITH BLAIR B. MANKINS AND DEANNE P. MANKINS, TRUSTEES OF THE BLAIR AND DEANNE MANKINS REVOCABLE TRUST AND MARK H. MANKINS, TRUSTEE OF THE 2M TRUST FOR PUBLIC OFF-STREET PARKING, SUBJECT TO ANY MINOR, TECHNICAL, OR NON-SUBSTANTIVE CHANGES AS APPROVED BY THE CITY MANAGER IN CONSULTATION WITH THE CITY ATTORNEY WHEREAS, off-street parking is a critical and finite resource in the Arroyo Grande Village area; and WHEREAS, the City has leased two private property parcels for off -street parking lots on the north side of East Branch Street, including the subject property; and WHEREAS, the City Council previously approved a lease agreement for public off -street parking in September of 2016, which expired in September of 2021 ; and WHEREAS, the agreement includes leasing private property to be used for public off - street parking; and WHEREAS, the cost of the lease of $1.00 each month for the next five years is minimal. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Arroyo Grande that: 1. The recitals set for herein are true, correct, and incorporated herein by this reference. 2. Adopting the Resolution is not a project subject to the California Environmental Quality Act (“CEQA”) because approval of a lease agreement for public parking does not in itself have potential to result in either a direct, or reasonably foreseeable indirect, physical change to the environment. (State CEQA Guidelines, §§ 15060(c)(2) and 15061(b)(3).) 3. The City Manager is authorized to execute the Lease Agreement, as set forth in Exhibit A, in substantially final form, subject to any minor, technical, or non- substantive changes as approved by the City Manager in consultation with the City Attorney. On motion of Council Member , seconded by Council Member , and on the following roll call vote, to wit: AYES: NOES: ABSENT: the foregoing Resolution was passed and adopted this 23rd day of September, 2025. Page 101 of 169 RESOLUTION NO. PAGE 2 CAREN RAY RUSSOM, MAYOR ATTEST: JESSICA MATSON, CITY CLERK APPROVED AS TO CONTENT: MATTHEW DOWNING, CITY MANAGER APPROVED AS TO FORM: ISAAC ROSEN, CITY ATTORNEY Page 102 of 169 RESOLUTION NO. PAGE 3 Exhibit “A” AGREEMENT OF LEASE THIS AGREEMENT OF LEASE (“Lease”) made and entered into this ___ day of September 2025, by and between Blair B. Mankins and DeAnne P. Mankins, Trustees of the Blair and DeAnne Mankins Revocable Trust under Declaration of Trust dated September 9, 2015 and Mark Mankins, Trustee of the 2M Trust under Declaration of Trust dated June 30, 2022 (collectively “Owner”), and the City of Arroyo Grande (“Tenant”), that certain real property in the City of Arroyo Grande, San Luis Obispo County, California, more particularly described in Exhibit "A", a copy of which is attached hereto and incorporated by reference. Premises: Owner hereby leases to Tenant that certain real property in the City of Arroyo Grande, San Luis Obispo County, California, more particularly described in Exhibit “A” and depicted on Exhibit "B," which are attached hereto and made a part hereof by reference (the “Leased Premises”). By entry hereunder, Tenant accepts the Leased Premises as being in the condition in its “AS -IS” condition and warrants that the Leases Premises are suitable for Tenant’s use. Term: The term of this Lease shall be for a period of five (5) years (the “Term”), beginning October 1, 2025, and ending September 30, 2030. Rent: Rent for the term of the Lease is One Dollar ($1.00) per month over five years, to be paid in advance as a lump sum of Sixty Dollars ($60.00) upon the signing of this lease by the parties hereto. Taxes: Not less than thirty (30) days before delinquency, Tenant shall pay all City and County real property taxes assessed on the Leased Premises during the Term of this Lease, or any extension thereof. The taxes shall be prorated as applicable for the taxing fiscal year for any portion of the term. The Leased Premises are presently assessed on the county tax records as two (2) separate parcels and taxed as two (2) separate parcels. All parties to this agreement mutually agree to use good faith efforts to have the County continue to tax the Leased Premises in the same manner. Owners shall cooperate with Tenant in promptly delivering to Tenant all tax bills received covering the Leased Premises. Termination Prior to September 30, 2030: If both Owner and Tenant agree in writing, this Lease may be terminated prior to September 30, 2030. Tenant may terminate this Lease at any time with 30 days prior notice. Maintenance. The parties acknowledge and agree that Owner shall have no duty whatsoever to maintain any portion of the Leased Premises during the term of this Page 103 of 169 RESOLUTION NO. PAGE 4 Lease. Tenant agrees to maintain in a clean and safe condition all aspects of the Leased Premises, which consist of a parking lot known as APN 007-192-051 (“Parking Lot”)and the pedestrian walkway leading from the Parking Lot to East Branch Street known as APN 007-192-051 (“Walkway”). Maintenance of the Walkway shall include, but not be limited to removing trash and accumulated debris from the Walkway weekly and by sweeping the Walkway monthly. All landscaping is to be maintained by the Tenant. Tenant shall also maintain the Parking Lot in a clean and safe condition which shall include, but not be limited to, performing weekly removal of trash and accumulated debris and once a month sweeping. The Tenant shall also fill and repair potholes as necessary and shall resurface and seal the Parking Lot as well as paint all parking stalls within one (1) year of the effective date of the Lease. Tenant shall also make certain that any parking stalls are visibly painted at all times, and that any signage on the Leased Premises is visibly posted and displayed. Hold Harmless and Insurance: Tenant hereby agrees to keep the Leased Premises insured under its Municipal Liability Insurance Policy and agrees to indemnify and hold Owner harmless and exempt from any damage or injury to any person or property arising from the use of the Leased Premises, or from failure of Tenant to keep the Leased Premises in good condition and repair, as herein provided. It is specifically agreed that Owner shall not, other than to the extent of Owner’s sole negligence, be liable for any claims for death or injury to persons, or damages to or destruction of property by Tenant or by any other person using the Leased Premises. The policies for insurance required by this section shall name Owner as an additional insured, and shall not be cancelable without thirty (30) days’ prior written notice by insurer to Owner. Notices: All notices to be given to Owner or to Tenant shall be given by personal delivery, or registered mail (return receipt requested) deposited in the United States post office in the City of Arroyo Grande, postage prepaid. The addresses to be used for the parties to this agreement are: Tenant: City Of Arroyo Grande 300 East Branch Street Arroyo Grande CA 93420 Owner: Blair B. Mankins and DeAnne P. Mankins, Trustees of the Blair and DeAnne Mankins Revocable Trust under Declaration of Trust dated September 9, 2015 and Mark Mankins, Trustee of the 2M Trust under Declaration of Trust dated June 30, 2022 101 E. Branch Street Arroyo Grande, CA 93420 Personal delivery to Owner may be made by personal delivery to Blair Mankins. Personal delivery to Tenant may be made by personal delivery to the City Manager, or the Director of Legislative and Information Services /City Clerk. Page 104 of 169 RESOLUTION NO. PAGE 5 Change of address may be made in writing, delivered to Owner or to Tenant as herein provided. Sublease: Tenant may not assign, transfer in whole or in part, or sublet any portion of the Leased Premises without the prior written consent of Owner. Parking Meters: No parking meters shall be permitted on the Leased Premises without the prior written consent of Owner. Waste, Alterations, Additions: Tenant shall not commit or suffer to be committed any waste of the said Leased Premises or permit any public or private nuisance. Tenant shall not make or suffer to be made any alterations to the Leased Premises without the prior written consent of Owner. Any additions or alterations, which may be permitted on the Leased Premises, shall become a part of said premises. Tenant shall keep all trees, bushes, and shrubs on the property trimmed to allow water in adjacent gutters and drains to flow freely as well as to prevent impacts to the building foundation. Tenant shall place the under-sidewalk drain at the southwesterly corner of the Leased Premises on a regular annual maintenance schedule to be cleaned out not less than three (3) times a year. Tenant shall modify the drain line in the planter area at the southwesterly corner of the Leased Premises to drain to the center of the planter and shall trim the bottle brush tree located inside the planter so that it does not overhang the drainage facility adjacent to the building. Additionally, Tenant shall keep all trees, bushes and shrubs on the Leased Premises trimmed to a height not to exceed one (1) foot below the top of the parapet of the portion of the building situated at 101-103 East Branch Street. Use of Premises: The Leased Premises are being leased for the sole purpose of use for off-street public parking and access thereto, and Tenant shall not permit the Leased Premises to be used for any other purpose without the prior written consent of Owner. Compliance with Law. Tenant shall, at its sole cost and expense, comply with all the applicable requirements of municipal, State and Federal authorities now in force or which hereinafter be enacted pertaining to the Leased Premises and the use of the Leased Premises as provided in this Lease. Surrender of Premises. Tenant shall be responsible for the removal, disposal, or remediation of any substances or materials Tenant causes to be used, stored, transported, or disposed on the Leased Premises at the conclusion of the Term of this Lease. Landlord shall be responsible for the removal, disposal, or remediation of any other substances or materials on the Leased Premises. Attorneys’ Fees. If either party commences an action against the other party arising out of or in connection with this Lease, the prevailing party shall be entitled to have and recover from the losing party reasonable attorneys’ fees and costs of suit. Page 105 of 169 RESOLUTION NO. PAGE 6 Entire Agreement. This Lease constitutes the entire agreement between Owner and Tenant. This Lease shall be binding and inure to the benefit of the parties hereto, their respective successors and assigns. Page 106 of 169 RESOLUTION NO. PAGE 7 OWNER: _______________________________ Blair and DeAnne Mankins Revocable Trust under Declaration of Trust dated September 9, 2015 By: Blair B. Mankins Trustee By: DeAnne P. Mankins Trustee 2M Trust under Declaration of Trust dated June 30, 2022 By: Mark H. Mankins Trustee TENANT: _______________________________ MATTHEW DOWNING, CITY MANAGER ATTEST: _______________________________ JESSICA MATSON, CITY CLERK AS TO CONTENT: _______________________________ ISAAC ROSEN, CITY ATTORNEY Page 107 of 169 RESOLUTION NO. PAGE 8 EXHIBIT "B" That certain real property in the City of Arroyo Grande, County of San Luis Obispo, State of California, described as follows: Page 108 of 169 RESOLUTION NO. PAGE 9 Page 109 of 169 RESOLUTION NO. PAGE 10 Page 110 of 169 RESOLUTION NO. PAGE 11 EXHIBIT B Page 111 of 169