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CC 2021-01-12_08k Lease Agreement_Cloud Seeding_SLO County FCD MEMORANDUM TO: CITY COUNCIL FROM: WHITNEY MCDONALD, CITY MANAGER / ACTING COMMUNITY DEVELOPMENT DIRECTOR BY: PATRICK HOLUB, ASSISTANT PLANNER SUBJECT: RE-CONSIDERATION OF APPROVAL OF A CLOUD SEEDING LEASE AGREEMENT WITH THE SAN LUIS OBISPO COUNTY WATER CONSERVATION AND FLOOD CONTROL DISTRICT DATE: JANUARY 12, 2021 SUMMARY OF ACTION: Approval of the proposed Cloud Seeding Lease Agreement with the San Luis Obispo County Water Conservation and Flood Control District (FCD) for property off of Branch Mill Road at the end of Huebner Lane will allow FCD to construct a Cloud Seeding site and increase the volume of surface water storage at Lake Lopez. This agreement is modified slightly from the version approved by Council on November 10, 2020, to address revised insurance requirements of the FCD. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: The FCD will pay the City rent of $1 per year. Staff time has been necessary to prepare the original and revised Lease Agreement for consideration by Council. RECOMMENDATION: It is recommended the City Council approve and authorize the Mayor to execute a modified Cloud Seeding Lease Agreement (Lease Agreement) between the City and the FCD for use of approximately 900 square feet of property located on Huebner Lane. BACKGROUND: On November 10, 2020 the City Council considered and approved a lease agreement with the FCD for the lease of 900 square feet of City-owned property for use as a cloud seeding site (Attachment 1). After additional review of the insurance requirements of Exhibit C to the approved Lease Agreement, FCD has requested that the agreement be revised as shown in Attachment 2. ANALYSIS OF ISSUES: The FCD is requesting that the insurance requirements included in the Lease Agreement be revised in order to bring the agreement into conformance with the FCD’s insurance requirements and to clarify the roles of “Lessor” and “Lessee.” The City Attorney has Item 8.k. - Page 1 CITY COUNCIL RE-CONSIDERATION OF APPROVAL OF A CLOUD SEEDING LEASE AGREEMENT WITH THE SAN LUIS OBISPO COUNTY WATER CONSERVATION AND FLOOD CONTROL DISTRICT JANUARY 12, 2021 PAGE 2 reviewed these proposed revisions and indicates that they are reasonable under the circumstances. As before, the Lease Agreement has a one-year term, and four (4) one (1) year options to extend to allow flexibility and to evaluate the success of the project. Options to extend may be exercised if the FCD is in compliance with all provisions of the Lease Agreement and provides at least sixty (60) days’ written notice prior to the expiration of the Lease Agreement. The Lease Agreement would allow the FCD to utilize 900 square feet of the easternmost portion of the site for the ground-based equipment. ALTERNATIVES: The following alternatives are provided for the Council's consideration: 1. Approve staff’s recommendation; 2. Do not approve staff’s recommendation; 3. Provide direction to staff. ADVANTAGES: Approval of the modified Lease Agreement will allow the City to participate in the existing cloud seeding program and potentially increase rainfall totals in the Lake Lopez watershed. DISADVANTAGES: No disadvantages have been identified. ENVIRONMENTAL REVIEW: On August 13, 2019, following a public hearing, the San Luis Obispo County Board of Supervisors adopted a Final Mitigated Negative Declaration (MND) for the Winter Cloud Seeding Program for Lake Lopez and Salinas Reservoir watersheds. This determination is sufficient under the California Environmental Quality Act for the establishment of this new location. The FCD is responsible for implementing the mitigation measures identified in the MND throughout the duration of the project. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. ATTACHMENTS: 1. November 10, 2020 Approved Lease Agreement 2. Revised Lease Agreement Item 8.k. - Page 2 1 GROUND LEASE AGREEMENT FOR CLOUD SEEDING SITE THIS GROUND LEASE AGREEMENT (“Agreement”) is made this 10th day of November, 2020, by and between the SAN LUIS OBISPO COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, a special district located within San Luis Obispo County, a political subdivision of the State of California, (“DISTRICT”) and the CITY OF ARROYO GRANDE, a municipal corporation (“LESSOR”). RECITALS WHEREAS, LESSOR is the owner of a parcel of land located at 581 Huebner Lane, Arroyo Grande, more particularly described as San Luis Obispo County Assessor's Parcel Number 007-611-016 (the "Property”); WHEREAS, the DISTRICT desires to construct, operate and maintain cloud seeding equipment on a portion of the Property (the “Facility Site”); WHEREAS, LESSOR is willing to permit the use and maintenance of the Facility Site by DISTRICT provided DISTRICT protects LESSOR from liability as provided herein, pays rent as provided herein for the use and maintenance of the Facility, and takes appropriate steps to prevent interference with LESSOR and other lessees’ use of the Property. NOW, THEREFORE, in consideration of the premises and the provisions, covenants and conditions hereinafter set forth, DISTRICT and LESSOR agree as follows: 1.LEASED PROPERTY/USE: LESSOR hereby exclusively leases to DISTRICT a portion of ground space measuring approximately 30 by 30 feet in the location shown on Exhibit “A,” attached hereto and incorporated herein by reference (the “Facility Site”), together with the non-exclusive right of ingress and egress to the Facility Site maintained by LESSOR as reasonably necessary to allow the DISTRICT access to the Facility Site. Lessee shall use the Facility Site solely for the purpose of constructing, maintaining and operating the Facility Site as described in Exhibit "B," attached hereto and incorporated herein by reference. 2.DISTRICT’S EXCLUSIVE USE: The Facility Site is leased to the DISTRICT for the sole purpose of cloud seeding and non-commercial use of the Facility Site. DISTRICT shall not use or permit the Facility Site or any part thereof to be used for any purpose other than the purposes stated herein or otherwise approved in writing by the LESSOR. 3.RENT: For and in consideration of the rights granted in Section 1 above, during the term of this Agreement, DISTRICT shall pay to LESSOR the sum of One Dollar and 00/100 ($1.00) per year. Said payment shall be made in full and in advance of each year of the lease term. 4.TERM: The term of this Agreement shall commence upon execution by all parties and shall terminate October 31, 2021, unless extended as provided herein. Attachment 1 Item 8.k. - Page 3 2 5. OPTION TO EXTEND: Provided DISTRICT is in compliance with all the terms and conditions of this Agreement, DISTRICT is hereby granted four (4) options to extend this Agreement from and after the expiration of the original term, which options shall be for a period of one (1) year each. DISTRICT, through its Director (or designee), may exercise said option(s) to renew by providing written notice to LESSOR at least sixty (60) days prior to the expiration of the then-current term (by September 1 of each year). Extension Periods: Extension One: November 1, 2021 through October 31, 2022 Extension Two: November 1, 2022 through October 31, 2023 Extension Three: November 1, 2023 through October 31, 2024 Extension Four: November 1, 2024 through October 31, 2025 In the absence of a written extension, any holdover occupancy by DISTRICT shall be deemed to be on a month to month basis. 6. INDEMNIFICATION: To the fullest extent permitted by law and without limiting the specific provisions set forth in Section 10 below related to environmental matters and hazardous materials, each party shall indemnify, defend, and hold harmless the other party and the other party’s officers, partners, agents, employees, and volunteers from and against all claims, demands, damages, liabilities, loss, costs, and expense (including attorney’s fees and costs of litigation) of every nature arising out of or in connection with the indemnifying party’s performance or non-performance of any obligation or duty provided for or relating to this Agreement and/or the Property, except such loss or damage which was caused by sole negligence or willful misconduct of the potential indemnitee. 7. SURRENDER OF FACILITY SITE: Upon expiration or earlier termination of this Agreement, DISTRICT agrees to remove all improvements placed or caused to be placed on LESSOR'S Property by DISTRICT and shall cause the Facility Site to be restored to its original, pre-lease condition so far as is reasonably practicable, unless otherwise agreed by both parties. DISTRICT further agrees to use all reasonable efforts to prevent the general public, persons not employed by, agents of, or contracted by the DISTRICT to undertake activities in furtherance of the purposes of this Agreement, and all other unauthorized persons, from using or accessing any areas of the Property to which the DISTRICT has access. 8. INTERFERENCE: DISTRICT shall construct, operate and maintain the Facility Site in such a manner that does not cause interference to LESSOR and other lessees of the Property. LESSOR shall not lease any portion of the Property in any way which interferes with DISTRICT’s use. Any interference of the Facility Site shall be deemed a material breach by LESSOR, and LESSOR must Item 8.k. - Page 4 3 terminate said interference immediately, following thirty (30) days written notice directed to LESSOR. 9. ASSIGNMENT: DISTRICT shall not assign this Agreement in whole or in part, nor, without the prior written consent of the LESSOR. 10. Environmental Matters / Covenants Regarding Hazardous Materials: DISTRICT shall not cause or permit any hazardous substance to be used, stored, generated or disposed of on or about the Property by DISTRICT, its agents, employees or contractors. If DISTRICT causes or permits the presence of any hazardous substance on the Property that results in contamination, DISTRICT shall promptly, at its sole expense, take any and all necessary action to return the Property to the condition existing prior to the presence of any such hazardous substance on the Property. DISTRICT shall first obtain LESSOR’S approval for any such remedial action. LESSOR and DISTRICT shall at all times and in all respects comply with all federal, state and local laws, ordinances and regulations ("Hazardous Materials Laws") relating to industrial hygiene, environmental protection or the use, analysis, generation, manufacture, storage, disposal or transportation of any oil, flammable explosives, asbestos, urea formaldehyde, radioactive materials or waste, or other hazardous, toxic, contaminated or polluting materials, substances or wastes, including, without limitation, any "hazardous substances," "hazardous wastes," "hazardous materials" or "toxic substances" under such laws, ordinance or regulations (collectively, "Hazardous Materials"). LESSOR and DISTRICT shall further indemnify, defend, protect, and hold each other free and harmless from and against any and all claims, liabilities, penalties, forfeitures, losses or expenses (including attorneys' fees) or death of or injury to any person or damage to any property whatsoever, arising from or caused in whole or in part, directly or indirectly, by: (A) the presence in, on, under or about the premises or discharge in or from the premises of any Hazardous Materials or LESSOR's or DISTRICT’s use, analysis, storage, transportation, disposal, release, threatened release, discharge or generation of Hazardous Materials to, in, on, under, about or from the premises, or (B) LESSOR's or DISTRICT's failure to comply with any Hazardous Materials Law. LESSOR's and DISTRICT's obligations hereunder shall include, without limitation, and whether foreseeable or unforeseeable, all costs of any required or necessary repair, cleanup or detoxification or decontamination of the premises, and the preparation and implementation of any closure, remedial action or other required plans in connection therewith, and shall survive the expiration or earlier termination of the term of this Agreement. For purposes of the release and indemnity provisions hereof, any acts or omissions of LESSOR or DISTRICT , or by employees, agents, assignees, contractors or subcontractors of LESSOR or DISTRICT or others acting for or on behalf of LESSOR or DISTRICT (whether or Item 8.k. - Page 5 4 not they are negligent, intentional, willful or unlawful) shall be strictly attributable to LESSOR or DISTRICT. 11. INSURANCE: DISTRICT shall, at its sole cost and expense, procure and maintain during the entire term of this Agreement in accordance with the requirements of Exhibit "C," which is attached hereto and incorporated herein. Proof of insurance shall be submitted to the LESSOR prior to any use of the Facility Site by DISTRICT. 12. WAIVER: Waiver of any default by either party to this Agreement shall not be deemed to be waiver of any subsequent default. Waiver or breach of any provision of this Agreement shall not be deemed to be a waiver of any other or subsequent breach, and shall not be construed to be a modification of the terms of this Agreement unless this Agreement is modified or amended as provided herein. 13. AMENDMENT: This Agreement may be amended by the mutual consent of the parties hereto if such amendment or change is in written form and executed by the DISTRICT, or designee, and by the LESSOR. 14. CONSTRUCTION: Headings or captions to the provisions of this Agreement are solely for the convenience of the parties, are not part of this Agreement, and shall not be used to interpret or determine the validity of this Agreement. Any ambiguity in this Agreement shall not be construed against the drafter, but rather the terms and provisions hereof shall be given a reasonable interpretation as if both parties had, in fact, drafted this Agreement 15. SUCCESSORS IN INTEREST: This Agreement shall continue to the benefit of and be binding upon the employees, agents, heirs, successors in interest, personal representatives and assigns of the parties. 16. NOTICES: Except where otherwise specifically provided herein, all notices, payments and statements under this Agreement and in connection herewith shall be addressed and delivered personally or with postage prepaid by first class mail, registered or certified mail, or express courier service as follows: TO DISTRICT: San Luis Obispo County Flood Control and Water Conservation District County Government Center 1055 Monterey Street San Luis Obispo, CA 93408 TO LESSOR: City of Arroyo Grande 300 E Branch Street Arroyo Grande, CA 93420 Item 8.k. - Page 6 5 or at such other place as LESSOR or DISTRICT may from time to time designate in writing. When any notice is deposited in the United States Mail, first class postage prepaid, and directed to the address herein provided for, it shall be deemed delivered for all purposes hereunder on the next immediately following day 17. ENTIRE AGREEMENT: This Agreement contains the entire agreement between the parties relating to the lease and use of the Facility Site and supersedes all prior agreements, understandings, negotiations, and discussions of the parties, whether expressed or implied, and there are no warranties, representations, covenants, or other agreements between the parties in connection with the subject matter hereof, except as specifically set forth herein. 18. SEVERABILITY: If any provision of this Agreement is determined by a court of competent jurisdiction to be illegal or unenforceable, said provision shall be deemed to be severed and deleted and neither such provision, its severance nor deletion, shall affect the validity of the remaining provisions of this Agreement. 19. APPLICABLE LAW AND VENUE: This Agreement shall be construed in accordance with and be governed by the laws of the State of California. The Parties agree that in the event of any litigation between them or arising from or related to this Agreement, the exclusive venue of such litigation shall be in the State of California, Superior Court of San Luis Obispo County. 20. DIRECTOR AUTHORITY/CERTIFICATION OF SIGNATORY: DISTRICT Director or designee may exercise all rights and obligations of DISTRICT under this Agreement, unless specifically provided otherwise herein or required by law. The parties to this Agreement acknowledge that the Board of Supervisors delegates to the DISTRICT the authority to renew/amend the Agreement by extending its term, and to sign any amendment exchanging, deleting, or adding to the terms and conditions of this Agreement. Any amendment made pursuant to a delegation of authority will only be effective if, prior to the commencement of services or extension of the Agreement, the amendment is memorialized in writing, is approved by DISTRICT Counsel, and is signed by the Director. The Board expressly delegates to the Director the authority to renew this Agreement contingent on prior funding approval. All signatories and parties to this Agreement warrant and represent that they have the power and authority to enter into this Agreement in the names, titles and capacities herein stated. IN WITNESS WHEREOF, DISTRICT and LESSOR have executed this Agreement to be effective on the date first stated above. Item 8.k. - Page 7 6 SAN LUIS OBISPO COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT: CITY OF ARROYO GRANDE By: Name: Title: Date: By: Caren Ray Russom, Mayor Date: APPROVED AS TO FORM: APPROVED AS TO FORM: Rita Neal, County Counsel Date: Timothy J. Carmel, City Attorney Date: Item 8.k. - Page 8 EXHIBIT A FACILITY SITE LOCATION Item 8.k. - Page 9 EXHIBIT B INSTALLATION OF CLOUD-SEEDING EQUIPMENT APN-007-611-016 Description For ground-based seeding of coastal storms, NAWC uses burn-in-place flares, that release Silver Iodide. Silver Iodide molecules attract super-cooled liquid water (water that exists in a storm system in liquid form below freezing) molecules, causing them to coalesce and form snowflakes or hail stones. Through this process, moisture that would otherwise stay aloft is extracted from the storm system and falls to the ground where it contributes to runoff and ground water. Safety The burn in place flares are housed in spark arrestors to protect nearby vegetation. In addition, our technicians perform weed abatement as necessary to prevent the growth of tall weeds in the surrounding area. If our systems are located in open fields, we provide enclosures to keep animals and pedestrians away from equipment and machinery. In the case of APN-007-611-016, a perimeter fence already exists. Silver Iodide in the presence of daylight Silver Iodide quickly returns to elemental Silver and Iodine. Iodine is a critical food supplement for various mammals, including humans. Silver is almost completely biologically inert, and even if directly ingested would pass through the body without being absorbed by tissue. Both Siler and Iodide quickly dissipate into the storm system and are thoroughly dispersed. No significant concentrations of either compound will remain in the immediate areas surrounding the installations. Equipment The equipment to be installed consists of 2 primary masts that house the burn-in-place flares, one mast that holds the solar panel and coms equipment and a web camera for monitoring equipment (detailed pictures of the equipment are included below). The 3 masts are supported by aluminum bases that are buried in the ground and encased in poured concrete. These bases extend about 2-feet above grade. If necessary, the three masts can be removed at the end of each storm season and re-installed prior to the next season, reducing the equipment footprint during the summer months. This would, however, incur some additional expense to the County of San Luis Obispo if required. The web camera is mounted to a small pole buried 1-2 feet in the ground, and sometimes incased in a small amount of concrete. This camera serves both a security and operational function as it allows us to monitor the flares as they burn, during a storm system. Installation and maintenance Installation is minimally invasive and generally requires two days of access to the facility. On the first day, holes are dug and concrete is poured (mixed by hand on-site). The concrete is allowed 24- 48hrs to cure, at which point the masts are dropped and locked into their bases. Periodically throughout the season flares will be replaced. Typically, this happens once every 2-5 storms, generally 1 or 2 times per month. This takes roughly an hour to complete. Some of our partners provide us with gate keys to access the site for regular maintenance, others require a member of the partnering utility to be onsite during these maintenance intervals, we leave that decision up to you. Item 8.k. - Page 10 EXHIBIT B Figure 1. Proposed location of the installation Figure 2. Detailed view of the proposed location of the installation Item 8.k. - Page 11 EXHIBIT B Figure 3. Equipment with labels Figure 4. Above grade measurements of equipment Item 8.k. - Page 12 EXHIBIT B Figure 5. Below grade representation Item 8.k. - Page 13 EXHIBIT C INSURANCE REQUIREMENTS Prior to the beginning of and throughout the duration of the Work, District will maintain insurance in conformance with the requirements set forth below. District will use existing coverage to comply with these requirements. If that existing coverage does not meet the requirements set forth here, District agrees to amend, supplement or endorse the existing coverage to do so. District acknowledges that the insurance coverage and policy limits set forth in this section constitute the minimum amount of coverage required. Any insurance proceeds available to City in excess of the limits and coverage required in this agreement and which is applicable to a given loss, will be available to City. District shall provide the following types and amounts of insurance: Commercial General Liability Insurance using Insurance Services Office “Commercial General Liability” policy from CG 00 01 or the exact equivalent. Defense costs must be paid in addition to limits. There shall be no cross liability exclusion for claims or suits by one insured against another. Limits are subject to review but in no event less than $1,000,000 per occurrence. Business Auto Coverage on ISO Business Auto Coverage from CA 00 01 including symbol 1 (Any Auto) or the exact equivalent. Limits are subject to review, but in no event to be less than $1,000,000 per accident. If District owns no vehicles, this requirement may be satisfied by a non-owned auto endorsement to the general liability policy described above. If District or District’s employees will use personal autos in any way on this project, District shall provide evidence of personal auto liability coverage for each such person. Workers Compensation on a state-approved policy form providing statutory benefits as required by law with employer’s liability limits no less than $1,000,000 per accident or disease. Excess or Umbrella Liability Insurance (Over Primary) if used to meet limit requirements, shall provide coverage at least as broad as specified for the underlying coverages. Any such coverage provided under an umbrella liability policy shall include a drop down provision providing primary coverage above a maximum $25,000 self-insured retention for liability not covered by primary but covered by the umbrella. Coverage shall be provided on a “pay on behalf” basis, with defense costs payable in addition to policy limits. Policy shall contain a provision obligating insurer at the time insured’s liability is determined, not requiring actual payment by the insured first. There shall be no cross liability exclusion precluding coverage for claims or suits by one insured against another. Coverage shall be applicable to City for injury to employees of District, subcontractors or others involved in the Work. The scope of coverage provided is subject to approval of City following receipt of proof of insurance as required herein. Limits are subject to review but in no event less than $1,000,000 per occurrence. Professional Liability or Errors and Omissions Insurance as appropriate shall be written on a policy form coverage specifically designated to protect against acts, errors or omissions of the District and “Covered Professional Services” as designated in the policy Item 8.k. - Page 14 EXHIBIT C must specifically include work performed under this agreement. The policy limit shall be no less than $1,000,000 per claim and in the aggregate. The policy must “pay on behalf of” the insured and must include a provision establishing the insurer’s duty to defend. The policy retroactive date shall be on or before the effective date of this agreement. Insurance procured pursuant to these requirements shall be written by insurer that are admitted carriers in the state California and with an A.M. Bests rating of A- or better and a minimum financial size VII. General conditions pertaining to provision of insurance coverage by District. District and City agree to the following with respect to insurance provided by District: 1. District agrees to have its insurer endorse the third party general liability coverage required herein to include as additional insureds City, its officials employees and agents, using standard ISO endorsement No. CG 2010 with an edition prior to 1992. District also agrees to require all Districts, and subcontractors to do likewise. 2. No liability insurance coverage provided to comply with this Agreement shall prohibit District, or District’s employees, or agents, from waiving the right of subrogation prior to a loss. District agrees to waive subrogation rights against City regardless of the applicability of any insurance proceeds, and to require all Districts and subcontractors to do likewise. 3. All insurance coverage and limits provided by District and available or applicable to this agreement are intended to apply to the full extent of the policies. Nothing contained in this Agreement or any other agreement relating to the City or its operations limits the application of such insurance coverage. 4. None of the coverages required herein will be in compliance with these requirements if they include any limiting endorsement of any kind that has not been first submitted to City and approved of in writing. 5. No liability policy shall contain any provision or definition that would serve to eliminate so-called “third party action over” claims, including any exclusion for bodily injury to an employee of the insured or of any District or subcontractor. 6. All coverage types and limits required are subject to approval, modification and additional requirements by the City, as the need arises. District shall not make any reductions in scope of coverage (e.g. elimination of contractual liability or reduction of discovery period) that may affect City’s protection without City’s prior written consent. 7. Proof of compliance with these insurance requirements, consisting of certificates of insurance evidencing all of the coverages required and an additional insured endorsement to District’s general liability policy, shall be delivered to City at or prior to the execution of this Agreement. In the event such proof of any insurance is not delivered as required, or in the event such insurance is canceled at any time and no Item 8.k. - Page 15 EXHIBIT C replacement coverage is provided, City has the right, but not the duty, to obtain any insurance it deems necessary to protect its interests under this or any other agreement and to pay the premium. Any premium so paid by City shall be charged to and promptly paid by District or deducted from sums due District, at City option. 8. Certificate(s) are to reflect that the insurer will provide 30 days notice to City of any cancellation of coverage. District agrees to require its insurer to modify such certificates to delete any exculpatory wording stating that failure of the insurer to mail written notice of cancellation imposes no obligation, or that any party will “endeavor” (as opposed to being required) to comply with the requirements of the certificate. 9. It is acknowledged by the parties of this agreement that all insurance coverage required to be provided by District or any subcontractor, is intended to apply first and on a primary, noncontributing basis in relation to any other insurance or self insurance available to City. 10. District agrees to ensure that subcontractors, and any other party involved with the project who is brought onto or involved in the project by District, provide the same minimum insurance coverage required of District. District agrees to monitor and review all such coverage and assumes all responsibility for ensuring that such coverage is provided in conformity with the requirements of this section. District agrees that upon request, all agreements with subcontractors and others engaged in the project will be submitted to City for review. 11. District agrees not to self-insure or to use any self-insured retentions or deductibles on any portion of the insurance required herein and further agrees that it will not allow any District, subcontractor, Architect, Engineer or other entity or person in any way involved in the performance of work on the project contemplated by this agreement to self-insure its obligations to City. If District’s existing coverage includes a deductible or self-insured retention, the deductible or self-insured retention must be declared to the City. At the time the City shall review options with the District, which may include reduction or elimination of the deductible or self-insured retention, substitution of other coverage, or other solutions. 12. The City reserves the right at any time during the term of the contract to change the amounts and types of insurance required by giving the District ninety (90) days advance written notice of such change. If such change results in substantial additional cost to the District, the City will negotiate additional compensation proportional to the increase benefit to City. 13. For purposes of applying insurance coverage only, this Agreement will be deemed to have been executed immediately upon any party hereto taking any steps that can be deemed to be in furtherance of or towards performance of this Agreement. 14. District acknowledges and agrees that any actual or alleged failure on the part of City to inform District of non-compliance with any insurance requirements in no Item 8.k. - Page 16 EXHIBIT C way imposes any additional obligations on City nor does it waive any rights hereunder in this or any other regard. 15. District will renew the required coverage annually as long as City, or its employees or agents face an exposure from operations of any type pursuant to this agreement. This obligation applies whether or not the agreement is canceled or terminated for any reason. Termination of this obligation is not effective until City executes a written statement to that effect. 16. District shall provide proof that policies of insurance required herein expiring during the term of this Agreement have been renewed or replaced with other policies providing at least the same coverage. Proof that such coverage has been ordered shall be submitted prior to expiration. A coverage binder or letter from District’s insurance agent to this effect is acceptable. A certificate of insurance and/or additional insured endorsement as required in these specifications applicable to the renewing or new coverage must be provided to City within five days of the expiration of the coverages. 17. The provisions of any workers’ compensation or similar act will not limit the obligations of District under this agreement. District expressly agrees not to use any statutory immunity defenses under such laws with respect to City, its employees, officials and agents. 18. Requirements of specific coverage features or limits contained in this section are not intended as limitations on coverage, limits or other requirements nor as a waiver of any coverage normally provided by any given policy. Specific reference to a given coverage feature is for purposes of clarification only as it pertains to a given issue, and is not intended by any party or insured to be limiting or all-inclusive. 19. These insurance requirements are intended to be separate and distinct from any other provision in this agreement and are intended by the parties here to be interpreted as such. 20. The requirements in this Section supersede all other sections and provisions of this Agreement to the extent that any other section or provision conflicts with or impairs the provisions of this Section. 21. District agrees to be responsible for ensuring that no contract used by any party involved in any way with the project reserves the right to charge City or District for the cost of additional insurance coverage required by this agreement. Any such provisions are to be deleted with reference to City. It is not the intent of City to reimburse any third party for the cost of complying with these requirements. There shall be no recourse against City for payment of premiums or other amounts with respect thereto. 22. District agrees to provide immediate notice to City of any claim or loss against District arising out of the work performed under this agreement. City assumes no Item 8.k. - Page 17 EXHIBIT C obligation or liability by such notice, but has the right (but not the duty) to monitor the handling of any such claim or claims if they are likely to involve City. Item 8.k. - Page 18 1 of 13 GROUND LEASE AGREEMENT FOR CLOUD SEEDING SITE THIS GROUND LEASE AGREEMENT (“Agreement”) is made this day of , 20 by and between the SAN LUIS OBISPO COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT, a special district located within San Luis Obispo County (“DISTRICT”) and the CITY OF ARROYO GRANDE, a municipal corporation (“LESSOR”). RECITALS WHEREAS, LESSOR is the owner of a parcel of land located at 581 Huebner Lane, Arroyo Grande, more particularly described as San Luis Obispo County Assessor's Parcel Number 007-611-016 (the "Property”); WHEREAS, the DISTRICT desires to construct, operate and maintain cloud seeding equipment on a portion of the Property (the “Facility Site”); WHEREAS, LESSOR is willing to permit the use and maintenance of the Facility Site by DISTRICT provided DISTRICT protects LESSOR from liability as provided herein, pays rent as provided herein for the use and maintenance of the Facility Site, and takes appropriate steps to prevent interference with LESSOR and other lessees’ use of the Property. NOW, THEREFORE, in consideration of the premises and the provisions, covenants and conditions hereinafter set forth, DISTRICT and LESSOR agree as follows: 1.LEASED PROPERTY/USE: LESSOR hereby exclusively leases to DISTRICT a portion of ground space measuring approximately 30 by 30 feet in the location shown on Exhibit “A,” attached hereto and incorporated herein by reference (the “Facility Site”), together with the non- exclusive right of ingress and egress to the Facility Site maintained by LESSOR as reasonably necessary to allow the DISTRICT access to the Facility Site. Lessee shall use the Facility Site solely for the purpose of constructing, maintaining and operating the Facility Site as described in Exhibit "B," attached hereto and incorporated herein by reference. 2.DISTRICT’S EXCLUSIVE USE: The Facility Site is solely leased to the DISTRICT for the sole purpose of cloud seeding and non-commercial use of the Facility Site. DISTRICT shall not use or permit the Facility Site or any part thereof to be used for any purpose other than the purposes stated herein or otherwise approved in writing by the LESSOR. 3.RENT: For and in consideration of the rights granted in Section 1 above, during the term of this Agreement, DISTRICT shall pay to LESSOR the sum of One Dollar and 00/100 ($1.00) per year. Said payment shall be made in full and in advance of each year of the lease term. 4.TERM: The term of this Agreement shall commence upon execution by all parties and shall terminate October 31, 2021, unless extended as provided herein. 5.OPTION TO EXTEND: Provided DISTRICT is in compliance with all the terms and conditions of this Agreement, DISTRICT is hereby granted four (4) options to extend this Agreement from and after the expiration of the original term, which options shall be for a period of one (1) year Attachment 2 Item 8.k. - Page 19 2 of 13 6. each. DISTRICT, through its Director (or designee), may exercise said option(s) to renew by providing written notice to LESSOR at least sixty (60) days prior to the expiration of the then- current term (by September 1 of each year). Extension Periods: Extension One: November 1, 2021 through October 31, 2022 Extension Two: November 1, 2022 through October 31, 2023 Extension Three: November 1, 2023 through October 31, 2024 Extension Four: November 1, 2024 through October 31, 2025 In the absence of a written extension, any holdover occupancy by DISTRICT shall be deemed to be on a month to month basis. 7. INDEMNIFICATION: To the fullest extent permitted by law and without limiting the specific provisions set forth in Section 10 below related to environmental matters and hazardous materials, each party shall indemnify, defend, and hold harmless the other party and the other party’s officers, partners, agents, employees, and volunteers from and against all claims, demands, damages, liabilities, loss, costs, and expense (including attorney’s fees and costs of litigation) of every nature arising out of or in connection with the indemnifying party’s performance or non-performance of any obligation or duty provided for or relating to this Agreement and/or the Property, except such loss or damage which was caused by sole negligence or willful misconduct of the potential indemnitee. 8. SURRENDER OF FACILITY SITE: Upon expiration or earlier termination of this Agreement, DISTRICT agrees to remove all improvements placed or caused to be placed on LESSOR'S Property by DISTRICT and shall cause the Facility Site to be restored to its original, pre-lease condition so far as is reasonably practicable, unless otherwise agreed by both parties. DISTRICT further agrees to use all reasonable efforts to prevent the general public, persons not employed by, agents of, or contracted by the DISTRICT to undertake activities in furtherance of the purposes of this Agreement, and all other unauthorized persons, from using or accessing any areas of the Property to which the DISTRICT has access. 9. INTERFERENCE: DISTRICT shall construct, operate and maintain the Facility Site in such a manner that does not cause interference to LESSOR and other lessees of the Property. LESSOR shall not lease any portion of the Property in any way which interferes with DISTRICT’s use. Any interference of Property shall be deemed a material breach by LESSOR, and LESSOR must terminate said interference immediately, following thirty (30) days written notice directed to LESSOR. 10. ASSIGNMENT: DISTRICT shall not assign this Agreement in whole or in part, nor, without the prior written consent of the LESSOR. 11. Environmental Matters / Covenants Regarding Hazardous Materials: DISTRICT shall not cause or permit any hazardous substance to be used, stored, generated or disposed of on or about the Property by DISTRICT, its agents, employees or contractors. If DISTRICT causes or permits the presence of any hazardous substance on the Property that results in Item 8.k. - Page 20 3 of 13 contamination, DISTRICT shall promptly, at its sole expense, take any and all necessary action to return the Property to the condition existing prior to the presence of any such hazardous substance on the Property. DISTRICT shall first obtain LESSOR’S approval for any such remedial action. LESSOR and DISTRICT shall at all times and in all respects comply with all federal, state and local laws, ordinances and regulations ("Hazardous Materials Laws") relating to industrial hygiene, environmental protection or the use, analysis, generation, manufacture, storage, disposal or transportation of any oil, flammable explosives, asbestos, urea formaldehyde, radioactive materials or waste, or other hazardous, toxic, contaminated or polluting materials, substances or wastes, including, without limitation, any "hazardous substances," "hazardous wastes," "hazardous materials" or "toxic substances" under such laws, ordinance or regulations (collectively, "Hazardous Materials"). LESSOR and DISTRICT shall further indemnify, defend, protect, and hold each other free and harmless from and against any and all claims, liabilities, penalties, forfeitures, losses or expenses (including attorneys' fees) or death of or injury to any person or damage to any property whatsoever, arising from or caused in whole or in part, directly or indirectly, by: (A) the presence in, on, under or about the Property or discharge in or from the Property of any Hazardous Materials or LESSOR's or DISTRICT’s use, analysis, storage, transportation, disposal, release, threatened release, discharge or generation of Hazardous Materials to, in, on, under, about or from the Property, or (B) LESSOR's or DISTRICT's failure to comply with any Hazardous Materials Law. LESSOR's and DISTRICT's obligations hereunder shall include, without limitation, and whether foreseeable or unforeseeable, all costs of any required or necessary repair, cleanup or detoxification or decontamination of the Property, and the preparation and implementation of any closure, remedial action or other required plans in connection therewith, and shall survive the expiration or earlier termination of the term of this Agreement. For purposes of the release and indemnity provisions hereof, any acts or omissions of LESSOR or DISTRICT, or by employees, agents, assignees, contractors or subcontractors of LESSOR or DISTRICT or others acting for or on behalf of LESSOR or DISTRICT (whether or not they are negligent, intentional, willful or unlawful) shall be strictly attributable to LESSOR or DISTRICT. 12. INSURANCE: DISTRICT and LESSOR shall, at their sole cost and expense, procure and maintain during the entire term of this Agreement insurance in accordance with the requirements of Exhibit "C," which is attached hereto and incorporated herein. Proof of insurance shall be submitted to the other party prior to any use of the Facility Site by DISTRICT. 13. WAIVER: Waiver of any default by either party to this Agreement shall not be deemed to be waiver of any subsequent default. Waiver or breach of any provision of this Agreement shall not be deemed to be a waiver of any other or subsequent breach, and shall not be construed to be a modification of the terms of this Agreement unless this Agreement is modified or amended as provided herein. 14. AMENDMENT: This Agreement may be amended by the mutual consent of the parties hereto if such amendment or change is in written form and executed by the DISTRICT, or designee, and by the LESSOR. Item 8.k. - Page 21 4 of 13 15. CONSTRUCTION: Headings or captions to the provisions of this Agreement are solely for the convenience of the parties, are not part of this Agreement, and shall not be used to interpret or determine the validity of this Agreement. Any ambiguity in this Agreement shall not be construed against the drafter, but rather the terms and provisions hereof shall be given a reasonable interpretation as if both parties had, in fact, drafted this Agreement 16. SUCCESSORS IN INTEREST: This Agreement shall continue to the benefit of and be binding upon the employees, agents, heirs, successors in interest, personal representatives and assigns of the parties. 17. NOTICES: Except where otherwise specifically provided herein, all notices, payments and statements under this Agreement and in connection herewith shall be addressed and delivered personally or with postage prepaid by first class mail, registered or certified mail, or express courier service as follows: TO DISTRICT: San Luis Obispo County Flood Control and Water Conservation District County Government Center 1055 Monterey Street San Luis Obispo, CA 93408 TO LESSOR: City of Arroyo Grande 300 E Branch Street Arroyo Grande, CA 93420 or at such other place as LESSOR or DISTRICT may from time to time designate in writing. When any notice is deposited in the United States Mail, first class postage prepaid, and directed to the address herein provided for, it shall be deemed delivered for all purposes hereunder on the next immediately following day 18. ENTIRE AGREEMENT: This Agreement contains the entire agreement between the parties relating to the lease and use of the Facility Site and supersedes all prior agreements, understandings, negotiations, and discussions of the parties, whether expressed or implied, and there are no warranties, representations, covenants, or other agreements between the parties in connection with the subject matter hereof, except as specifically set forth herein. 19. SEVERABILITY: If any provision of this Agreement is determined by a court of competent jurisdiction to be illegal or unenforceable, said provision shall be deemed to be severed and deleted and neither such provision, its severance nor deletion, shall affect the validity of the remaining provisions of this Agreement. 20. APPLICABLE LAW AND VENUE: This Agreement shall be construed in accordance with and be governed by the laws of the State of California. The Parties agree that in the event of any litigation between them or arising from or related to this Agreement, the exclusive venue of such litigation shall be in the State of California, Superior Court of San Luis Obispo County. 21. DIRECTOR AUTHORITY/CERTIFICATION OF SIGNATORY: The San Luis Obispo County Director of Public Works as ex officio staff to the DISTRICT, or designee, may exercise all rights Item 8.k. - Page 22 5 of 13 and obligations of DISTRICT under this Agreement, unless specifically provided otherwise herein or required by law. The parties to this Agreement acknowledge that the Board of Supervisors delegates to the Director of Public Works the authority to execute this Agreement and to renew/amend the Agreement by extending its term, and to sign any amendment exchanging, deleting, or adding to the terms and conditions of this Agreement. Any amendment made pursuant to a delegation of authority will only be effective if, prior to the commencement of services or extension of the Agreement, the amendment is memorialized in writing, is approved by DISTRICT Counsel, and is signed by the Director of Public Works. The Board of Supervisors expressly delegates to the Director the authority to renew this Agreement contingent on prior funding approval. All signatories and parties to this Agreement warrant and represent that they have the power and authority to enter into this Agreement in the names, titles and capacities herein stated. IN WITNESS WHEREOF, DISTRICT and LESSOR have executed this Agreement to be effective on the date first stated above. SAN LUIS OBISPO COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT: CITY OF ARROYO GRANDE By: Chairperson of the Board Date: ATTEST: WADE HORTON Ex-Officio Clerk of the Board of Supervisors By: Caren Ray Russom, Mayor Date: By: Deputy Clerk Date: APPROVED AS TO FORM: APPROVED AS TO FORM: RITA L. NEAL County Counsel Timothy J. Carmel, City Attorney Date: Deputy County Counsel Date: L:\Utilities\2020\December\AG - 2020.10.22 Lease Agreement for Cloud Seeding Site RPS (003) PW 12-21-202_Clean (1).docx 12/22/20 Item 8.k. - Page 23 EXHIBIT A FACILITY SITE LOCATION 6 of 13 VICINTIY MAP New Cloud Seeding Site Arroyo Grande, CA COUNTY OF SAN LUIS OBISPO DEPARTMENT OF PUBLIC WORKS Item 8.k. - Page 24 EXHIBIT B 7 of 13 INSTALLATION OF CLOUD-SEEDING EQUIPMENT APN-007-611-016 Description For ground-based seeding of coastal storms, NAWC uses burn-in-place flares, that release Silver Iodide. Silver Iodide molecules attract super-cooled liquid water (water that exists in a storm system in liquid form below freezing) molecules, causing them to coalesce and form snowflakes or hail stones. Through this process, moisture that would otherwise stay aloft is extracted from the storm system and falls to the ground where it contributes to runoff and ground water. Safety The burn in place flares are housed in spark arrestors to protect nearby vegetation. In addition, our technicians perform weed abatement as necessary to prevent the growth of tall weeds in the surrounding area. If our systems are located in open fields, we provide enclosures to keep animals and pedestrians away from equipment and machinery. In the case of APN-007-611-016, a perimeter fence already exists. Silver Iodide in the presence of daylight Silver Iodide quickly returns to elemental Silver and Iodine. Iodine is a critical food supplement for various mammals, including humans. Silver is almost completely biologically inert, and even if directly ingested would pass through the body without being absorbed by tissue. Both Siler and Iodide quickly dissipate into the storm system and are thoroughly dispersed. No significant concentrations of either compound will remain in the immediate areas surrounding the installations. Equipment The equipment to be installed consists of 2 primary masts that house the burn-in-place flares, one mast that holds the solar panel and coms equipment and a web camera for monitoring equipment (detailed pictures of the equipment are included below). The 3 masts are supported by aluminum bases that are buried in the ground and encased in poured concrete. These bases extend about 2-feet above grade. If necessary, the three masts can be removed at the end of each storm season and re-installed prior to the next season, reducing the equipment footprint during the summer months. This would, however, incur some additional expense to the County of San Luis Obispo if required. The web camera is mounted to a small pole buried 1-2 feet in the ground, and sometimes incased in a small amount of concrete. This camera serves both a security and operational function as it allows us to monitor the flares as they burn, during a storm system. Installation and maintenance Installation is minimally invasive and generally requires two days of access to the facility. On the first day, holes are dug and concrete is poured (mixed by hand on-site). The concrete is allowed 24-48hrs to cure, at which point the masts are dropped and locked into their bases. Periodically throughout the season flares will be replaced. Typically, this happens once every 2-5 storms, generally 1 or 2 times per month. This takes roughly an hour to complete. Some of our partners provide us with gate keys to access the site for regular maintenance, others require a member of the partnering utility to be onsite during these maintenance intervals, we leave that decision up to you. Item 8.k. - Page 25 EXHIBIT B 8 of 13 Figure 1. Proposed location of the installation Figure 2. Detailed view of the proposed location of the installation Item 8.k. - Page 26 EXHIBIT B 9 of 13 Figure 3. Equipment with labels Figure 4. Above grade measurements of equipment Item 8.k. - Page 27 EXHIBIT B 10 of 13 Figure 5. Below grade representation Item 8.k. - Page 28 EXHIBIT C INSURANCE REQUIREMENTS 11 of 13 1. DISTRICT’s Insurance. During the Term of this Agreement and any extension thereof, DISTRICT shall at all times maintain in effect the following policies of insurance: (a) Comprehensive General Liability Insurance for the Facility Site in a combined coverage for bodily injury and property damage in an amount not less than Two Million Dollars ($2,000,000). DISTRICT shall name LESSOR as an additional insured under such policy; (b) During any period of construction of any improvements by DISTRICT on the Facility Site, Builder's Risk Property Insurance in a form mutually acceptable to DISTRICT and LESSOR; and (c) Upon completion of any improvements by DISTRICT on the Facility Site, a policy of all risk property insurance insuring the DISTRICT improvements in an amount at least equal to the replacement cost thereof as reasonably approved by LESSOR. Such coverages shall be from such companies and on such other terms and conditions as DISTRICT from time to time may reasonably determine. At DISTRICT's option, such insurance coverage may include the risks of earthquake, flood damage or other perils; business income (rental loss) and extra expense coverage; and loss payee endorsements in favor of any Leasehold Mortgagee. 2. LESSOR's Insurance. During the term of this Agreement and any extension thereof, LESSOR shall at all times maintain in effect the following policies of insurance: (a) A policy of all risk property insurance insuring the existing improvements on the Facility Site in an amount at least equal to the replacement cost thereof as reasonably approved by DISTRICT, provided that (i) LESSOR shall not be responsible for such insurance from and after the effective date of this Agreement (which coverage shall then be DISTRICT's obligation); and (b) Comprehensive General Liability Insurance for the Property in a combined coverage for bodily injury and property damage in an amount not less than Two Million Dollars ($2,000,000). LESSOR shall name DISTRICT as an additional insured under such policy; and Such coverages shall be from such companies and on such other terms and conditions as LESSOR from time to time may reasonably determine. At LESSOR's option, such insurance coverage may include the risks of earthquake, flood damage or other perils; business income (rental loss) and extra expense coverage; and loss payee endorsements in favor of the holders of any mortgages or deeds of trust encumbering the interest of LESSOR in any existing improvements on the Facility Site or underlying lessors of all or part of any existing improvements on the Facility Site. From and after the effective date of this Agreement Date, DISTRICT shall be responsible to maintain and pay for all insurance described in this Section 2. Item 8.k. - Page 29 EXHIBIT C 12 of 13 3. Policy Standards. All policies of insurance to be provided hereunder shall be written by companies of nationally recognized financial standing and which are legally qualified to issue such insurance and have a Best Services rating of at least A. Each policy of insurance held by LESSOR and DISTRICT shall contain reasonable deductibles and shall (i) name the other as an additional insured; (ii) be non-contributing with, and shall apply only as primary and not excess to, any other insurance available to the insureds; and (iii) provide that it shall not be cancelled or amended or its coverage reduced except upon thirty (30) days' prior written notice by certified or registered mail to each of the insureds. LESSOR and DISTRICT shall not obtain or carry separate insurance concurrent in form or contributing, in the event of loss, with that required by this Section unless the other is an additional insured therein. LESSOR or DISTRICT, as applicable, shall immediately notify the other whenever any such separate insurance is obtained and shall deliver to the other certificates evidencing the same. Any insurance required hereunder may be provided under blanket policies provided that the coverage afforded shall not be reduced or diminished by reason of the use of a blanket policy. 4. Protection of Proceeds. Every policy referred to herein shall provide that it shall not be invalidated by any act or neglect of LESSOR or DISTRICT, by any termination of this Agreement, other than the expiration of the Agreement as set forth herein, or by change in title to the Property. 5. Certificates of Insurers. LESSOR and DISTRICT shall each deliver to the other certificates of insurers evidencing the existence of all insurance which is required to be maintained by LESSOR and DISTRICT, respectively, hereunder. Delivery shall be made (i) promptly after the effective date of this Agreement and (ii) no later than fifteen (15) days prior to the expiration of any insurance. 6. Waiver of Subrogation. LESSOR and DISTRICT intend that their respective property loss risks shall be borne by reasonable insurance carriers to the extent above provided, and LESSOR and DISTRICT hereby agree to look solely to, and seek recovery only from, such insurance carriers in the event of a property loss to the extent that such coverage is agreed to be provided hereunder. The parties each hereby waive all rights and claims against each other for such losses, and waive all rights of subrogation of such insurers, provided such waiver of subrogation shall not affect the right to the insured to recover thereunder. The insurance policies to be carried by LESSOR and DISTRICT hereunder shall be endorsed such that the waiver of subrogation shall not affect the right of the insured to recover thereunder, so long as no material additional premium is charged therefor. Excess or Umbrella Liability Insurance (Over Primary) if used to meet limit requirements, shall provide coverage at least as broad as specified for the underlying coverages. Any such coverage provided under an umbrella liability policy shall include a drop down provision providing primary coverage above a maximum $25,000 self-insured retention for liability not covered by primary but covered by the umbrella. Coverage shall be provided on a “pay on behalf” basis, with defense costs Item 8.k. - Page 30 EXHIBIT C 13 of 13 payable in addition to policy limits. Policy shall contain a provision obligating insurer at the time insured’s liability is determined, not requiring actual payment by the insured first. There shall be no cross-liability exclusion precluding coverage for claims or suits by one insured against another. Coverage shall be applicable to LESSOR for injury to employees of DISTRICT, subcontractors or others involved in the cloud seeing operations. The scope of coverage provided is subject to approval of LESSOR following receipt of proof of insurance as required herein. Limits are subject to review but in no event less than $1,000,000 per occurrence. Item 8.k. - Page 31 THIS PAGE INTENTIONALLY LEFT BLANK Item 8.k. - Page 32