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CC - Agendas - City Council - REGULAR - 3/23/2010
PRESCOTT CITY COUNCIL c'.ITYo.F PRESCOTT- REGULAR VOTING MEETING 7,-.0�,y4-4,ff(�hr AGENDA PRESCOTT CITY COUNCIL Council Chambers REGULAR VOTING MEETING 201 South Cortez Street TUESDAY, March 23, 2010 Prescott, Arizona 86303 3:00 P.M. (928) 777-1100 The following Agenda will be considered by the Prescott City Council at its Regular Voting Meeting pursuant to the Prescott City Charter, Article II, Section 13. Notice of this meeting is given pursuant to Arizona Revised Statutes, Section 38-431.02. • CALL TO ORDER • INTRODUCTIONS • INVOCATION: Pastor Amy Ryland, Church of Nazarene • PLEDGE OF ALLEGIANCE: Councilman Lamerson • ROLL CALL: MAYOR AND CITY COUNCIL: Mayor Kuykendall Councilman Blair Councilwoman Linn Councilman Hanna Councilwoman Lopas Councilman Lamerson Councilwoman Suttles • SUMMARY OF CURRENT OR RECENT EVENTS I. PROCLAMATIONS A. April 2010 as Water Awareness Month II. PUBLIC COMMENT A. Martha Wolfinger re removal of Spanish version of Census Banner. III. PRESENTATIONS A. Introduction of new businesses. B. Presentation by R Wall re plans for mural at Acker Park. Prescott City Council Regular Voting Meeting — March 23, 2010 Page 2 IV. REGULAR AGENDA A. Adoption of Ordinance No. 4721-1018 — An ordinance of the Mayor and Council of the City of Prescott, Yavapai County, Arizona, superseding Ordinance No. 4665-0908 during the pending of the Legislative Moratorium or further Legislative actions; and amending Title II, Chapter 2-1, and Title III, Chapter 3-14 regarding the imposition of water and sewer development fees; and declaring an emergency. B. Award bid to Digital Payment Technologies for three (with an option for four) Kiosks in an amount not to exceed $75,000.00. C. Consideration of an agreement with Prescott Area Arts and Humanities Council in the amount of$15,000.00. D. Adoption of Resolution No. 4009-1039 — A resolution of the Mayor and Council of the City of Prescott, Yavapai County, Arizona, repealing all previous resolutions with regard to Council policy on membership on boards, commissions and committees and adopting a new Council policy on membership on boards, commissions and committees; and declaring an emergency. E. Appointment of members to the Council Appointment Committee. F. Approval of Settlement Agreement in Raber vs. City of Prescott. G. Approval of Property Purchase Agreement for the purchase of real property from the Stone Living Trust in the Thumb Butte Estates. H. Approval of the Minutes of the Prescott City Council Study Session of March 2, 2010; the Workshop of March 9, 2010; the Regular Voting Meeting of March 9, 2010; and the Study Session of March 16, 2010. I. Recess into Executive Session. V. EXECUTIVE SESSION A. Discussions or consultations with designated representatives of the public body in order to consider its position and instruct its representatives regarding negotiations for the purchase, sale or lease of real property, pursuant to ARS 38-431.03(A)(7). 1. Potential open space acquisitions. VI. ADJOURNMENT CERTIFICATION OF POSTING OF NOTICE he undersigned hereby certifies that a copy of the foregoing notice was duly posted at Prescott City Hall on -3—f 9—ldat ,ffl/ A .m.in accordance with the statement filed by the Prescott City Council with the City Clerk. E I bet A. e,MMC,City Cler IA PROCLAMATION "Water Awareness Month" April 2010 WHEREAS, water is one of our most vital and precious resources; and WHEREAS,Arizona is a semi-arid state,and water is scarce;and WHEREAS, while the City of Prescott's water resources are limited,population growth continues to increase the demand for water;and WHEREAS, all citizens of Prescott should use water efficiently and practice conservation to ensure a long-term water supply;and WHEREAS, creating a culture of conservation will greatly reduce the impacts of drought on our resources,economy and quality of life;and WHEREAS,water education is the cornerstone of any conservation program, and greater awareness of water issues can be gained through community education,action and celebration. NOW, THEREFORE, I, Marlin D. Kuykendall, Mayor of the City of Prescott, do hereby proclaim that the month of April 2010 be known as "WATER AWARENESS MONTH," and call upon all citizens and businesses of Prescott to become fully informed of the fact that our water resources are limited, and we all play a part in living "water smart", not only during the month of April,but all year round. IN WITNESS THEREOF,I have hereunto set my hand and caused the Seal of the City of Prescott to be affixed this 23rd day of March 2010. et 4, ,, '14 IN 41A�UYKEND EL,MAYOR ,,��!!a City o Prescott 14 ` A ATTEST: % ��'t �; E AB H A.BURKE/ "'�r '�+�iii•.�r� '�.�,-% CITY RK J-A COUNCIL AGENDA MEMO — 3/23/10 (Supplemental Information) DEPARTMENT: City Manager AGENDA ITEM: Approval of Ordinance No. 4721-1018 superseding Ordinance No. 4665-0908 during the legislative moratorium or further legislative actions regarding the imposition of water and sewer development fees, and declaring an emergency Approved By: Date: , t Regional Programs Director: Craig McConnell �- 3- /e-IO Finance Director: Mark Woodfill City Manager: Steve Norwood v , . Background As discussed in the previous Council agenda memo and March 16th Study Session, Ordinance No. 4721-1018 will not repeal No. 4665-0908 or its effective date, but instead make certain adjustments to the amounts and types of fees being assessed by the City. Key provisions of the Ordinance and implementation to effect compliance with the House Bill (HB) 2008 moratorium are summarized below: • Rollback of impact fees to the amounts on June 29, 2009, the last day prior to HB 2008 becoming effective. • Reinstatement of previous "sewer buy-in fees" which were replaced in Ordinance No. 4665-0908 by new sewer "impact fees" (the imposition of new fees is prohibited during the moratorium) due to suspension of the Ordinance. • Refund of amounts paid on and after July 11, 2009, exceeding the fee levels which were in effect on June 29, 2009. • Emergency clause to expedite compliance with HB 2008. The following actions are also to be taken for items identified at the Study Session: • Refund letters will be sent to the building permit holder, with copy to the property owner. • Sales tax which may not have been paid due to deductibility of the impact fees will be addressed in the refund letters. Permittees and property owners will be notified that the refund may create a sales tax obligation depending upon the nature of the project and which party paid for the permit. Contact information for the Privilege Tax Section of the City Finance Department will be provided to those being notified of eligibility for a refund. • CPI adiustment - due to a lack of internal clarity within HB 2008 (it can be interpreted in more than one way with respect to the CPI adjustment), and given both the current ENR- CCI (CPI) at 1.6% and low number of permits being issued for construction involving impact fees, annual adjustment is effectively a moot issue; consequently, the CPI adjustment provision has been removed from the revised Ordinance (attached). Attachments - Ordinance No. 4721-1018 (revised to remove CIP adjustment clause) - Table of current and rollback fees Recommended Action: MOVE to approve Ordinance No. 4721-1018 with the emergency clause. ORDINANCE NO. 4721-1018 AN ORDINANCE OF THE MAYOR AND COUNCIL OF THE CITY OF PRESCOTT, YAVAPAI COUNTY, ARIZONA, SUPERSEDING ORDINANCE NO. 4665-0908 DURING THE PENDING OF THE LEGISLATIVE MORATORIUM OR FURTHER LEGISLATIVE ACTIONS; AND AMENDING TITLE II, CHAPTER 2-1, AND TITLE III, CHAPTER 3-14 REGARDING THE IMPOSITION OF WATER AND SEWER DEVELOPMENT FEES; AND DECLARING AN EMERGENCY RECITALS: WHEREAS, on October 28, 2008, the Mayor and Council of the City of Prescott approved Ordinance No. 4665-0908 regarding the imposition of water and sewer development fees in accordance with ARS 9-463.05; and WHEREAS, Ordinance No. 4665-0908 provided for a delayed effective date of July 11, 2009; and WHEREAS, the City of Prescott implemented the water and sewer development fees as set forth by Ordinance No. 4665-0908 on July 11, 2009; and WHEREAS, the Arizona State Legislature enacted HB 2008 on August 12, 2009, which imposed a moratorium on municipalities implementing new or increasing existing development fees after June 29, 2009; and whereas numerous legislative proposals have been made to amend such legislation and are pending; and WHEREAS, the Governor of the State of Arizona signed HB2008 into law with an effective date of November 24, 2009; and WHEREAS, legislative proposals have been made and are ongoing regarding potential modifications to such law; and WHEREAS, in order to effect compliance with the provisions of HB 2008 while at the same time recognizing the approval of an ordinance by Prescott which was in effect and had an effective date prior to the legislative action applying the moratorium retroactively, in order to ensure compliance with the current laws and also to preserve Prescott's ordinance and its effective date it is necessary for the City of Prescott to take certain actions suspending the effect of Ordinance No. 4665-0908, passed on October 28th 2008 and which was to become effective on July 11, 2009 regarding the imposition of water and sewer development fees, pending the moratorium or other legislative action amending the impact fees legislation; and WHEREAS, the suspension of this ordinance and the fees collectable under the ordinance shall in no way effect a repeal of said Ordinance No. 4665-0908 or its effective date and is intended to solely suspend the impact fees in the ordinance and apply the prior effective ordinance only for as long as the moratorium shall be in ORDINANCE NO. 4721-1018 PAGE 2 effective and/or until pending legislation is adopted allowing the cessation of the impact fee suspension and allowing the fees to become effective. ENACTMENTS: NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF PRESCOTT AS FOLLOWS: SECTION 1. THAT Ordinance No. 4665-0908 is hereby suspended, and the previous ordinances regarding fees which were in effect at the time of adoption shall remain in effect due to the suspension of Ordinance No. 4665-0908 and fees are rolled back to the fees effective on June 29, 2009, as necessitated by current state law and such fees shall be applicable until such time as the council shall determine that the suspension of Ordinance No. 4665-0908 is no longer required by state law. SECTION 2. THAT Section 2-1-22 of the Prescott City Code, entitled "Departments; Public Works Department; Utilities Division; Sewer Buy In Fees," is hereby amended as follows: 2-1-22: UTILITIES DIVISION; SEWER BUY IN FEES: There shall be a mandatory charge for connections being served by any of the city's wastewater treatment plant systems that are owned, operated and maintained by the city. This charge shall be the equivalent of the customer's share of the costs to the city for the wastewater treatment plant systems, lift stations, and certain interceptor lines. (A) Residential: The charge shall be fifty-six dollars ($56.00) per fixture unit for a residential connection to the sewer system. Single-family residences, mobile homes, condominiums, apartments, and hotel/motels shall be classified as residential. 1. Number: The following shall be the number of fixture units per plumbing fixture: Number of Fixture Fixture Units—Residential Use Bar Sink 1 Bathtub (with or without shower) 2 Floor drains 2 Laundry tub or clothes washer (each pair of faucets) 2 Lavatory 1 Shower (each head) 2 Sink or dishwasher 2 Water Closet 3 ORDINANCE NO. 4721-1018 PAGE 3 2. Permit Fee: A fee of five dollars ($5.00) per residential permit shall be charged in addition to the fees charged in subsection (A)1 of this section. (B) Commercial: The charge shall be fifty-six dollars ($56.00) per fixture unit for a commercial connection to the sewer system. "Commercial connection" is hereby defined as any connection other than residential. (Ord. 3288, eff. 2-20- 1995; amd. Ord. 4317, 5-27-2003, eff. 7-1-2003). 1. Commercial Number: the following shall be the number of fixture units per plumbing fixture: Number of Fixture Fixture Units—Commercial Use Bar Sink 2 Bathtub (with or without shower) 4 Dental unit or cuspidor 1 Drinking fountain (each head) 1 Laundry tub or clothes washer (each pair of faucets) 4 Lavatory 2 Lavatory (dental) 1 Shower (each head) 4 Sink (flushing rim, clinic) 10 Sink (washup, circular spray) 4 Sink (washup, each set of faucets) 2 Sink or dishwasher 4 Urinal (flush tank) 3 Urinal (pedestal or similar type) 10 Urinal (stall) 5 Urinal (wall) 5 Water closet (flush tank) 5 Water closet (flushometer valve) 10 2 inch floor drains 4 3 inch floor drains 4 4 inch floor drains 4 All other traps of fixtures based upon trap size 2. Permit fee: A fee of five dollars ($5.00) per commercial permit shall be charged in addition to the fees charged in subsection (B)1 of this section. (C) Addition or Remodeling: Fees for connection made to the sewer system under any of the above classifications contained in subsection (A) or (B) of this section where connection is for the purpose of addition or remodeling, shall be in accordance with the sewer buy in fees stated in subsection (A) or (B) of this section, except that charges shall be made only for the number of fixture units in the addition or remodeling construction. ORDINANCE NO. 4721-1018 PAGE 4 (D) Charges Due and Payable: Charges and/or fees imposed under this section shall be due and payable when construction permits for units are issued (Ord. 2164, 4-10-1990; amd. Ord. 4317, 5-27-2003, eff. 7-1-2003). (E) Connection to City Main Line Sewer: For each sewer tap connection to a city main line sewer, there shall be a connection charge in the amount of two hundred dollars ($200.00) to cover the labor and material costs incurred by the city for making the actual main line sewer tap connection. (Ord. 4174,11- 27-2001, eff. 3-1-2002; amd. Ord. 4317, 5-27-2003, eff. 7-1-2003). (F) Change of Use: In the event of a change of use of a structure from residential to commercial purposes, there shall be paid to the city additional connection fees required in subsection (B) of this section, with a credit to be given for any connection fees which would have been assessed for that structure pursuant to subsection (A) of this section. (G) Fees Nontransferable: All fees paid pursuant to this section shall apply to the real property upon which the structure containing the fixture units is located. Connection fees are not transferable between properties. Structures moved from one location to another location must pay new connection fees for the new location, with a credit to be given for any connection fees previously paid for that location. (H) Connection Fees Waived: The city manager is hereby authorized to waive the provisions of subsection (G) of this section regarding transfer of connection fees between properties in the event that the city manager determines that compliance with subsection (G) of this section would result in gross inequity in a particular situation. (Ord. 3670, eff. 11-27-1997; amd. Ord. 4317, 5-27- 2003, eff. 7-1-2003). SECTION 3. THAT Section 3-14-13 of the Prescott City Code, entitled "Building Regulations; Development Fees; Development Fees for Water Resources," is hereby amended as follows: 3-14-13: DEVELOPMENT FEES FOR WATER RESOURCES: (A) All new construction TO BE CONNECTED TO THE CITY'S WATER SYSTEM, within OR OUTSIDE the City limits, shall be assessed the following development fee for water resources: Meter Size (inches) 5/8 X 3/4 $ 4,944.71 1 $11,485 8,257.73 1 1/2 $22,970 16,465.84 ORDINANCE NO. 4721-1018 PAGE 5 2 $36 26,355.26 (B) In the event that a one inch meter is required solely as a result of a house RESIDENTIAL UNIT being equipped with an automatic fire sprinkler system, then and '.^ that event the development fee to be assessed pursuant to this section shall be based on a 5/8" X 3/" meter size; provided, however, that this subsection shall not apply to residences 5,000 square feet or more in size. (C) In the event that an upsizing of meter size is required as a result of remodeling, renovation or expansion of a structure, the development fee to be assessed pursuant to this section shall be the difference between the development fee for the upsized meter versus the development fee for the existing meter. (D) For water meters and/or service lines greater than two inches (2"), and for meters utilized for irrigation only, the development fees to be assessed pursuant to this section shall be determined by the Public Works Director on the basis of projected water use stated in gallons per day, using the following formula: Development fee = fee for (5/8" X 3/") meter x (applicant's projected gallons per day [GPD] water use/residential equivalent unit water use of 235 GPD). (E) The development fees to be assessed pursuant to this section shall be offset by any fees paid by an applicant pursuant to PCC Section 2-1-12-(I). (F) Fees collected pursuant to this section may only be used for the acquisition, operations and maintenance of additional water resources, as may be authorized pursuant to Arizona Revised Statutes section 9-463.05. f6) The fccs provided far : th:c c 0 thereafter. SECTION 4. THAT Section 3-14-14 of the Prescott City Code, entitled "Building Regulations; Development Fees; Development Fees for Water System Impacts," is hereby amended as follows: 3-14-14: DEVELOPMENT FEES FOR WATER SYSTEM IMPACTS: (A) All new construction TO BE CONNECTED TO THE CITY'S WATER SYSTEM, within OR OUTSIDE the City limits, shall be assessed the following development fee for water system impacts: Meter Size (inches) 5/8 x 3/4 $6,209 5,389.02 ORDINANCE NO. 4721-1018 PAGE 6 1 $1 5 522 8,999.71 1 1/2 $3-17844 17,945.39 2 $'19,671 28,723.43 (B) In the event that a one inch meter is required solely as a result of a house RESIDENTIAL UNIT being equipped with an automatic fire sprinkler system, the development fee to be assessed pursuant to this section shall be based on a 5/8" X 3/" meter size; provided, however, that this subsection shall not apply to residences 5,000 square feet or more in size. (C) In the event that an upsizing of meter size is required as a result of remodeling, renovation or expansion of a structure, the development fee to be assessed pursuant to this section shall be the difference between the development fee for the upsized meter versus the development fee for the existing meter according to the fee schedule in effect at the time of the application for the upside UPSIZED meter. (D) For water meters and/or service lines greater than two inches (2"), and for meters utilized for irrigation only, the development fees to be assessed pursuant to this section shall be determined by the Public Works Director on the basis of projected water use stated in gallons per day, using the following formula: Development fee = (fee for 5/8" X 3/") meter x (applicant's projected gallons per day [GPD] water use/residential equivalent unit water use of 235 GPD). (E) The development fees to be assessed pursuant to this section shall be offset by any fees paid by an applicant pursuant to PCC Section 2-1-12-(I). (F) Fees collected pursuant to this section may only be used for the-ac upgrades PURPOSES RELATED to the City's water production, treatment, transmission and distribution system as may be authorized pursuant to Arizona Revised Statutes section 9-463.05, AS AMENDED. (6) T" icn ch !! be incroasod by five percent (5%) on May 1, 2007, and shall be increased five percent (5%) per annum each May 1 thereafter. SECTION 5. THAT Section 3-14-15 of the Prescott City Code, entitled "Building Regulations; Development Fees; Development Fees for Wastewater System Impacts," is hereby deleted in its entirety and reserved for future use. SECTION 6. THAT the Mayor, the City Manager, the City Clerk and the City Attorney are hereby authorized and directed to take all steps and to execute all documents necessary to carry out the purpose and intent of this Ordinance. ORDINANCE NO. 4721-1018 PAGE 7 SECTION 7. THAT AN EMERGENCY IS HEREBY DECLARED TO EXIST AND { THIS ORDINANCE SHALL BE IN FULL FORCE AND EFFECT FROM AND AFTER ITS PASSAGE, ADOPTION, AND APPROVAL BY THE MAYOR AND COUNCIL OF THE CITY OF PRESCOTT. SECTION 8. THAT, if any provision of this Ordinance is for any reason held by any court of competent jurisdiction to be unenforceable, such provision of portion hereof shall be deemed separate, distinct, and independent of all other provisions and such holding shall not affect the validity of the remaining portions of this Ordinance. SECTION 10. THAT the effective date of this Ordinance shall be 2010. PASSED AND ADOPTED by the Mayor and Council of the City of Prescott, Arizona this day of , 2010. MARLIN KUYKENDALL, Mayor ATTEST: APPROVED AS TO FORM: ELIZABETH A. BURKE, City Clerk GARY D. KIDD, City Attorney City of Prescott Water and Wastewater Development and Impact Fees • Ordinance No. 4721-1018 will delete fees shown in the rows marked July 11, 2009, in the table below, and reestablish fees shown in the rows marked June 29, 2009 • Refunds will be made for all building permits during the period beginning June 30, 2009, which included payment of impact fees exceeding the reestablished fees • Retroactive payment of Sewer Buy In Fees is not being recommended for remodels adding fixture units during the period beginning July 11, 2009, and extending until Ordinance No. 4721-1018 is in effect Meter SizeJ { (� 5/8" x 3/4" 1" 1 1/2" /� 2" +` Water Resource Development Fee June 29, 2009 (1) $ 4,944.71 $ 8,257.73 $ 16,465.84 $ 26,355.26 July 11, 2009(2)(3) 4,594.00 I 11,485.00 I 22,970.00 I 36,752.00 Water System Impact Fee I June 29, 2009 (1) 5,389.02 8,999.71 17,945.39 28,723.43 July 11, 2009 (2)(3) I 6,209.00 I 15,522.00 I 31,044.00 I 49,671.00 " •t� , � t u�. Sewer Buy In Fees (4) June 29, 2009 $56 per fixture unit (residential and nonresidential) t .., , 3 1 Wastewater System Impact Fee (4) July 11, 2009 3,273.00 I 8,183.00 I 16,367.00 I 26,187.00 (1) June 29, 2009- Last day prior to HB 2008 moratorium becoming effective; with Ordinance No. 4665-0908 scheduled to become effective July 11, 2009, fees were not increased by the 5% annual adjustment which could otherwise have been applied effective May 1, 2009, per City Code (2) July 11, 2009, was the effective date of Ordinance No. 4665-0908 (3) Ordinance No. 4665-0908 was not yet effective so the annual ENR-CCI (CPI) adjustment enabled by the ordinance to be made on the first day of each fiscal year(in this case July 1, 2009) could not be applied (4) Sewer Buy In Fees were eliminated by Ordinance No. 4665-0908 (replaced by Wastewater System Impact Fees); Sewer Buy In Fees will be reinstated temporarily during the HB 2008 moratorium Rev March 17,2010 c COUNCIL AGENDA MEMO - March 23, 2010 Ty DEPARTMENT: Economic Development AGENDA ITEM: Prescott Area Arts and Humanities Council (PAAHC) Grant Recommendations Approved By: Date: Department Head: Jane Bristol (l 3/18/10 Finance Director: /i� City Manager: Steve Norwood BACKGROUND At last week's study session, Council and staff discussed the status of the bed tax fund to determine how to allocate funds that have been budgeted in Fiscal 2010. Three organizations have not yet received allocations from the fund: Revised Organization I Budget I Recommendation Prescott Area Arts and Humanities Council I $30,650 I $15,000 Prescott Frontier Days I $30,650 I $15,000 Prescott Creeks Association I $12,500 I $12,500 The City has a contract with Prescott Creeks Association to provide matching funds for a Water Resources grant related to improvements and maintenance at Watson Woods Riparian Preserve. According to Doris Selerius, Board Chair, the match is being provided over a five-year period and there are two more years to go on this grant. Prescott Frontier Days uses their allocation to market the World's Oldest Rodeo event outside the Prescott area to enhance tourism. The PAAHC utilizes their funding to award grants to various arts events and organizations that increase tourism, and last week recommended funding 10 grants totaling $30,150, plus administrative expenses of$500. RECOMMENDATION It is estimated that the Bed Tax Fund will have about $65,000 remaining at the end of the fiscal year if no other payments are allocated. Therefore, staff recommends a payout to the three organizations totaling $42,500, leaving an estimated balance of $22,500 to carry forward to FY2011. MOTION: Move to approve a $15,000 payment to PAAHC from the Bed Tax Fund. R , • 0 I 8 2 g k? pi.' 2 2 2 ...1 0 i... in t.... •r. 't. 0t 6. ei $ n: vz or or 0 el .1 el el, el ( i— i _ .. 2 0 a0-0 cs co C *•- •r v) co .1 N Q.0 -;•'. as E 0 ,. ,. .. " kieweNNNe- uo , z -, '", 0 1.• N 1.... „ c) at a ets ,,4 CO e o •.,,, . 1- E C\I •1•-• CNI V-. CD 0 ri z jC" . ...- co C3, " OS Oi •o et Cc)e G.cu 14. Z)- 0 C.3 crj 0 CO 0 OS' C4 0 c2..0 N c%1 E „ 0- E a• e , 41 : Cl• uj' a .... mi: 1 co co 6 R c,-) ... 0 0,. •-• 0 3 .... 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RESOLUTION NO. 4009-1039 A RESOLUTION OF THE MAYOR AND COUNCIL OF THE CITY OF PRESCOTT, YAVAPAI COUNTY, ARIZONA, REPEALING ALL PREVIOUS RESOLUTIONS WITH REGARD TO COUNCIL POLICY ON MEMBERSHIP ON BOARDS, COMMISSIONS AND COMMITTEES AND ADOPTING A NEW COUNCIL POLICY ON MEMBERSHIP ON BOARDS, COMMISSIONS AND COMMITTEES; AND DECLARING AN EMERGENCY RECITALS: WHEREAS, Resolution Number 2463, adopted on April 14, 1992, and subsequently amended by various resolutions, first established Council Policy on membership on boards, commissions and committees of the City of Prescott; and WHEREAS, a subcommittee of the City Council has reviewed the procedures established for membership on boards, commissions and committees, and has made recommendations for changes as indicated in Exhibit A, attached hereto and made a part hereof; and WHEREAS, the subcommittee also has recommended various changes to boards, commissions and committees of the City of Prescott and the City Council wishes to direct staff to bring forward necessary resolutions and/or ordinances to effectuate said changes in order to update, modernize and improve upon current practices; and WHEREAS, the subcommittee has recommended changes to the procedures to be followed for appointment of members and these new procedures are identified in Exhibit B, attached hereto and made a part hereof. ENACTMENTS: NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF PRESCOTT AS FOLLOWS: SECTION 1. THAT, Section 6 of Resolution No. 2463, and all subsequent amendments to the resolution inconsistent with this policy are hereby repealed. SECTION 2. THAT City staff is hereby directed to prepare and bring forward the necessary resolutions and/or ordinances to effectuate those changes proposed by the subcommittee of the Council, Exhibit A. SECTION 3. THAT Exhibit B identifies and establishes the procedures and processes to be followed for appointment of members to the City's boards, commissions and committees. RESOLUTION NO. 4009-1039 PAGE 2 SECTION 4. THAT, in order to provide for and ensure a smooth transition of any boards, commissions, and committees, the Council is hereby authorized and empowered to deviate from the terms of appointment of the initial members and currently serving appointees by council motion notwithstanding the provisions set forth above with respect to term of membership. SECTION 5. THAT the immediate operation of the provisions of this Resolution is necessary for the immediate preservation of the public peace, health or safety, and that an EMERGENCY is hereby declared to exist, to wit: that the immediate adoption of this Resolution is necessary to allow for the continued smooth functioning of various City Boards, Commissions and Committees; and THIS RESOLUTION SHALLB E IN FULL FORCE AND EFFECT FROM AND AFTER ITS PASSAGE AND ADOPTION BY THE MAYOR AND COUNCIL OF THE CITY OF PRESCOTT. PASSED and ADOPTED by the Mayor and Council of the City of Prescott, Arizona, this 23rd day of March, 2010. MARLIN D. KUYKENDALL, Mayor ATTEST: APPROVED AS TO FORM: ELIZABETH A BURKE, City Clerk GARY D KIDD, City Attorney RESOLUTION NO. 4009-1039 PAGE 3 EXHIBIT 'A' PRESCOTT CITY COUNCIL POLICY ON MEMBERSHIP ON BOARDS, COMMISSIONS AND COMMITTEES OF THE CITY Standing Committees: Acker Trust Board, Parks & Recreation Board, Prescott: The Arizona Centennial City Committee, Transportation Coordinating Committee: All terms are to be two, non-staggered terms, to be appointed in March of every even-numbered year (after the previous fall election). Chairman and Vice Chairman to be selected by the Council. The members of all but the Transportation Coordinating Committee may be regional residents; the Transportation Coordinating Committee members must be Prescott residents. Additionally, changes are to be made to the authorizing resolution of the Transportation Coordinating Committee providing that staff shall not be a voting member and that an additional voting member shall be added to the TCC to represent the Bicycle Community. Committees Established by City Code: Advisory & Appeals Board, Board of Adjustment, Fire Board of Appeals, Planning & Zoning Commission, Prescott Preservation Commission: Members of all of the boards/commissions established by City Code must be residents of the City of Prescott. The current length of terms will continue, but all appointments will be made in March of each year. Chairman and Vice Chairman will be selected by the Council. Committees Established by Arizona Revised Statutes: CDBG Citizens Advisory Committee, Industrial Development Authority, Municipal Property Corporation, Prescott/Yavapai Enterprise Zone Commission, Public Safety Retirement Board: The CDBG Citizens Advisory Committee which is authorized in federal regulations and shall serve for two years, appointed by the Council during March of even- numbered years. All other committees established by a.R.S. shall be appointed and shall serve as provided by law. City representation is eliminated on those external organizations indicated on page 3 of the B/C Table. Appointments Advertisement will occur in December of every odd-numbered year for all positions on Standing Committees, for appointment by March of the following year. Additionally, RESOLUTION NO. 4009-1039 PAGE 4 advertisement will occur for those positions on Boards/Commissions established by City Code in December of the year prior to said term expiration. • Further, all current members shall reapply for their respective boards, commissions and committees utilizing the City's application form and advertisement to occur for all positions. RESOLUTION NO. 4009-1039 PAGE 5 EXHIBIT `B' BOARDS/COMMISSIONS/COMMITTEES APPOINTMENT PROCEDURES A. Membership 1. Membership requirements shall be established in each respective resolution or ordinance creating said board, commission, or committee. 2. Members shall be considered solely on the basis of their own merits and qualifications and not on the basis of any personal friendships with committee or Council members. 3. If any member shall be absent for more than two (2) consecutive meetings without notifying the chairman, or shall be absent for more than thirty percent (30%) of all meetings during any one twelve (12) month period for any reason, he or she shall thereupon automatically cease to hold membership on the board, commissions or committee without any further action being taken by the City Council. It shall be the responsibility of the chairman of that board, commissions or committee to so notify the City Clerk immediately upon the creation of a vacancy pursuant to this section. Meetings as used in this section shall include all regular and special meetings, study sessions and field inspections. B. Selection 1. The City Clerk shall maintain a list of all members and will be aware of all expiration dates for all terms. The City Clerk shall maintain a file of all applicants as to current applications, filing dates, interest in other board positions, interviews and appointments. 2. Council Appointment Committee: A Council Appointment Committee shall consist of three (3) Council members appointed by the Mayor, with the consent of the Council, which shall be responsible for interviewing applicants for appointment to City boards, commissions and committees. The Mayor, with the consent of the Council, shall designate the Chairman. 3. When a vacancy occurs on a board, commissions or committee the chairman and/or staff liaison shall notify the City Clerk who shall begin advertising for said vacancies. 4. In December of each year, and whenever a vacancy may occur, the City Clerk shall advertise for applications. RESOLUTION NO. 4009-1039 PAGE 6 5. When sufficient, qualified applications are on file the City Clerk shall schedule interviews for said applicants with the Council Appointment Committee. 6. Once the Council Appointment Committee has made their recommendations, the City Clerk will present said recommendations to the City Council at a Council meeting. The candidate should be invited to be in attendance at the meeting and should be recognized by the Council. 7. Each applicant interviewed and considered shall be sent an acknowledgement letter to be signed by the Mayor. 8. Each applicant appointed shall be so advised in writing by the Mayor and the City Clerk shall send to each appointee a list of all members of the board, commissions or committee to which they were appointed, along with a Board/Commission/Committee Handbook, to include information on Open Meeting and Conflict of Interest laws. 9. The Department Head designated as an ex-officio member of each board, commission or committee, shall send each appointee a packet containing a description the member's role and the role of the board, commission, committee, attendance requirements, meeting schedule and any other information which may be helpful in fulfilling his or her responsibilities. C. Orientation 1. In March of each year the City Clerk's Office, in conjunction with the City Attorney's Office, shall facilitate Board/Commission/Committee Training for all members recently appointed as well as others interested in attending. { COUNCIL AGENDA MEMO - (03/23/2010) DEPARTMENT: City Clerk AGENDA ITEM: Appointment of members to the Council Appointment Committee Approved By: Date: Department Head: Elizabeth A. Burke, City Clerk Finance Director: Mark Woodfill City Manager: Steve Norwood _ i© /7 Summary This agenda item will formalize the appointment of members to the Council Appointment Committee, the three-member committee that will interview applicants and make recommendations to the Council on board, commission, committee appointments. Background Earlier this year during a workshop discussion, Councilwoman Suttles and Councilmen Blair and Hanna agreed to serve as the Council Appointment Committee, to make recommendations to the Council on appointments to the City's boards, commissions and committees. With the recent changes being proposed on the board, commission, committee appointment process, the City Attorney suggested that this item come before the full Council for formal appointment of the Committee members. Additionally, the process proposed in the new procedures (which was taken from past practice) was that the Mayor would select the Chairman of this committee, with the consent of the Council. Mayor Kuykendall is recommending that Councilwoman Suttles serve as Chairman of this Committee based on her past experience with it. Recommended Action: MOVE to appoint Councilwoman Suttles and Councilmen Blair and Hanna to the Council Appointment Committee, with Councilwoman Suttles to serve as Chairman. 1 f COUNCIL AGENDA MEMO — MarchS, 2010 DEPARTMENT: Legal AGENDA ITEM: Proposed Lawsuit Settlement of Bobby and Beth Raber vs. City of Prescott Approved By: Date: Department Head: Gary D. Kidd (,;,/)/Z 3//9/0 Finance Director: Mark Woodfill City Manager: Steve Norwood(' I J Item Summary- Plaintiffs sued the City in 2008, alleging the City installed waterlines diagonally through their property cutting off usage of a large portion of the property. Plaintiffs alleged they intended to build a home at the highest and most beneficial point on their nine acre property and the water lines prevent them from doing that. Plaintiffs alleged that the City had no easements and/or easements set to expire in the near future for these waterlines. The City filed a counter-claim and trial was scheduled for this year. The parties went to mediation but a settlement was not reached at that time although the Mediator urged a much higher settlement amount to the Plaintiffs than ultimately has been proposed here. Since then, the parties have negotiated a total settlement which includes the following highlights: 1. Payment of the sum of $42,500 by the City to Plaintiffs subject to Council approval in an effort to avoid the necessity of further litigation and trial; 2. Agreement by the City to pay the mediation fees on behalf of the Plaintiffs in an amount not to exceed $5,000 upon presentation of an invoice from the.Mediator; 3. Plaintiffs' right to relocate the 14" water line by January 1, 2020, at Plaintiffs' expense so long as such relocation meets City standards and Plaintiffs provide City with any additional necessary easements to accommodate same; 4. Plaintiffs are to provide the City all new necessary easements to encompass the preexisting waterline on the subject property. The easements shall remain in perpetuity; and 5. Lastly, the City will quitclaim deed its legal rights and interests in the property commonly referred to as Lorraine Drive in and around the vicinity of Robbin Drive to the Plaintiffs. This settlement is deemed reasonable by staff and likely much less than the total cost of trial. Fiscal Impact:: $42,500; Plaintiffs' mediation fees not to exceed $5,000; and the value of the Lorraine Drive transfer. Recommended Action: Authorize the Mayor and City Attorney to enter into the proposed Settlement Agreement with Plaintiffs for the terms stated therein. COUNCIL AGENDA MEMO — (March 23, 2010) 1‘.4 DEPARTMENT: Legal AGENDA ITEM: Approval of purchase agreement for the purchase of real property from the Stone Living Trust in the Thumb Butte Estates for purchase price of $220,000.00, $8,000 to be accepted as a donation from the Seller and the remaining sum of$212,000 to be paid by the City to Seller Approved By: Date: Department Head: Gary D. Kidd Finance Director: Mark Woodfill A / City Manager: Steve Norwood lc, Item Summary: Consideration and possible purchase of real property from the Stone Living Trust known as Lot 18 located in the Thumb Butte Estates for the purpose of building a water storage reservoir on the property Background: In the absence of employee contacts in Public Works who were all on vacation, the Legal Department has prepared this council agenda memo. Therefore, the background portion of this memo is limited to the terms of the purchase agreement. The Stone property consists of Lot 18 in the Thumb Butte Estates, and is in the Thumb Butte area, Yavapai County, which the council has identified as one of its priority areas for the purpose of building a water storage reservoir. The proposed purchase agreement provides for a purchase price of $220,000, $8,000 to be accepted as a donation from the Seller, and the remaining sum of Two Hundred Twelve Thousand and no/100 ($212,000) to be paid by the City to Seller, which is payable as $10,000 earnest money deposit at the inception of escrow and a final lump sum payment at the close of escrow of$202,000. The other terms of the purchase agreement are standard and incorporate our customary City boilerplate language in such transactions. Attachments - Proposed Real Estate Purchase Agreement and attachments Recommended Action: MOVE to approve the proposed purchase agreement for the purchase of the real property from the Stone Living Trust in the Thumb Butte Estates and to authorize the Mayor and City staff to execute all documents necessary to complete the purchase of this property. 1 -:s REAL ESTATE PURCHASE AGREEMENT sd (Vacant Land) THIS REAL ESTATE PURCHASE AGREEMENT ("Agreement") is made and entered into by and between THE STONE LIVING TRUST ("Seller"), and the City of Prescott, an Arizona municipal corporation, ("Buyer"). WITNESSETH : WHEREAS, Seller owns certain real property consisting of Lot 18, Thumb Butte Estates, according to the plat of record in Book 18 of Maps and Plats, Page 87, records of Yavapai County, Arizona, more particularly described in Exhibit"A"attached hereto. WHEREAS, Seller desires to sell and Buyer desires to purchase such real property in accordance with the terms and conditions specified herein. NOW, THEREFORE, in consideration of the mutual covenants set forth in this Agreement, the parties hereby agree as follows: 1. DESCRIPTION OF PROPERTY. The real property which is the subject of this Agreement consists of Lot 18 of Thumb Butte Estates, Yavapai County, Arizona in the area commonly known as Thumb Butte (the "Property") as more fully described in Exhibit"A" attached hereto. 2. AGREEMENT TO SELL AND PURCHASE. Subject to the terms of this Agreement, Seller hereby agrees to sell to Buyer, and Buyer hereby agrees to purchase from Seller, on the terms and conditions herein set forth, the Property, together with all privileges, rights-of-way, easements, licenses, water rights, and other rights and benefits appurtenant to or used in connection with the beneficial use and enjoyment of such real property. The Property for purposes of the purchase provided for herein, is sometimes hereinafter referred to as the Purchase Parcel. The parties acknowledge and agree that the property is being purchased with public funds, is intended to and shall be for the benefit of the citizens of Prescott. 3. OPENING AND CLOSING DATES. "Opening of Escrow" shall occur when Escrow Agent accepts this Agreement as provided at the end of this Agreement. Subject to the satisfaction of all contingencies as set forth herein, the closing of this transaction (the "Closing" or the "Close of Escrow") shall take place at the office of the Escrow Agent on or before (the" Scheduled Closing Date"). i 4. PURCHASE PRICE. A. The purchase price for the property is agreed to be $220,000.00. 1. Seller and Buyer understand and agree that the difference between the agreed value as based upon Sellers' investments in the property and Sellers' estimated value, as defined herein as the purchase price, and the sum of Two Hundred Twelve Thousand and 3 00/100 dollars ($212,000) is intended to be and shall be and shall constitute a charitable gift by and from Seller to the City of Prescott. Both parties agree and understand that the City of Prescott intends to and is purchasing the property for Two Hundred Twelve Thousand and 00/100 dollars ($212,000), and that any difference between that amount and the value of the property as determined by the agreed upon value is and shall constitute a charitable donation to the City of Prescott by Seller. 2. The dollar value of the charitable gift shall be determined by deducting the Two Hundred Twelve Thousand and 00/100 dollars ($212,000) from the agreed upon value of the property and the Buyer accepts such dollar value as the value of the charitable gift, and shall recognize such donation and gift in accordance with the City of Prescott's normal practices and process for acceptance of such charitable donations to the City. 3. The total purchase amount therefore to be paid for the public property acquisition by the Buyer, City of Prescott, is $212,000, Two Hundred Twelve Thousand and 00/100 dollars, payable upon the close of escrow, based on the contingencies/conditions listed under item 3 immediately below, all at the Buyer's expense. B. The Seller warrants that Seller is the owner of a good title to the property herein sold and shall convey the property by warranty deed, free and clear of all liens and encumbrances, subject only to the following: 1. The tendered purchase price for the property to be paid by the City is agreed to be the total sum of $212,000.00 and has been determined by the City of Prescott to be fair value in the public interest based upon the suitability, need and public benefit of said property and has been also agreed to be the acceptable paid value by the Seller who will then donate the remainder of the purchase value to the public. C. Buyer shall provide payment for the purchase price to the Seller as follows: 1. The sum of Ten Thousand Dollars ($10,000.00) (the "Earnest Money Deposit") shall be deposited with the Escrow Agent, in cash or certified funds, within three (3) days from the Opening of Escrow, and shall be disbursed to the Seller upon the Close of Escrow. The Earnest Money Deposit shall be refundable until expiration of the Sixty (60) day Examination Period, at which time, if Buyer has failed to terminate this Agreement, it shall become non-refundable and shall be forfeited to Seller 2 upon Buyer's failure to perform, subject only to (a) the conditions of Section 4 hereof and (b) to performance by Seller of its obligations hereunder. Immediately upon receipt of the Earnest Money Deposit, the Escrow Agent shall deposit the funds in a short-term interest- bearing account at a financial institution mutually acceptable to Buyer and Seller. The interest earned on such deposit shall accrue to the benefit of the Buyer, except in the event Seller becomes entitled to retain the Earnest Money Deposit by reason of Buyer's failure to perform, in which event said interest shall accrue to the benefit of the Seller. (2) The balance of the remaining purchase price in the sum of Two Hundred and Two Thousand dollars ($202,000.000) shall be paid as follows: (a) Buyer shall pay the balance of Two Hundred and Two Thousand dollars ($202,000.000) to the Escrow Agent for the benefit of Seller plus or minus pro-rations as hereinafter provided, in cash or certified funds or by wire, on or before the Scheduled Closing Date, unless the Scheduled Closing Date is extended by mutual agreement of the parties in which case the balance shall be paid to Escrow Agent on or before the agreed upon extended closing date. The balance shall not bear interest and shall be paid and disbursed to Seller on or before Close of Escrow during the City of Prescott's fiscal year 2009-2010. 5. EXAMINATION PERIOD. A. Buyer shall have a period commencing on the date of Opening of Escrow and ending at 5:00 p.m. on the ( ) day after the Opening of Escrow but not later than (the "Examination Period") during which to make its examination and investigation of the Property, and this Agreement is subject to and conditioned upon Buyer's approval of same in Buyer's sole and absolute discretion. Buyer's activities during the Examination Period shall include, without limitation, investigation of all aspects of the Property that Buyer deems advisable to confirm that the Property is suitable for Buyer's intended use B. Within the Sixty (60) day examination period after the Opening of Escrow, or such shorter time period as will allow the closing of escrow prior to Seller shall assist in and cooperate with Buyer obtaining information and documents and any real property information possessed by Seller to assist Buyer in obtaining and procuring, at Buyers' sole cost, a survey of the Property (the "Survey") prepared by an Arizona licensed civil engineer. The Survey shall be certified to Buyer, Seller and Escrow Agent and shall meet the minimum ALTA/ASCM standards for issuance by Escrow Agent of an extended ALTA coverage owner's policy of title insurance. The Survey shall contain a complete and accurate legal description of the Property. In addition, Seller agrees to reasonably cooperate with Buyer during the Examination Period and to furnish Buyer such other documents, instruments and information in Seller's possession concerning the Property or its operation as Buyer may, from time to time, reasonably request. C. Following the Opening of Escrow, Buyer, its agents and employees may enter upon the Property at any time for the purpose of conducting any and all tests, 3 investigations, inspections, studies, and surveys which Buyer in its discretion may deem advisable. If Buyer desires an environmental report or any other reports of any kind with respect to the Property, Buyer shall obtain such reports at its expense during the Examination Period. Buyer hereby agrees to indemnify Seller and the Property and holds Seller and the Property free and harmless from any and all loss or liability resulting from the activities of Buyer, its agents and employees upon the Property, and from any and all mechanics', material man's and other liens resulting from such conduct of Buyer, its agents and employees upon the Property. The foregoing indemnification shall survive the termination of this Agreement. Buyer agrees to deliver to Seller, within five (5) days copies of any reports pertaining to any examination or inspection report received by Seller. D. At any time prior to the expiration of the Examination Period, if Buyer determines, for any reason whatsoever, that it does not desire to complete the transaction contemplated herein, Buyer may terminate this Agreement by so notifying Seller and Escrow Agent in writing. Upon termination of this Agreement pursuant to this paragraph, the escrow provided for herein shall be immediately canceled, the Earnest Money Deposit and all earnings thereon shall be returned to Buyer, and Buyer shall pay all escrow fees accrued in connection with the escrow or the cancellation thereof Notwithstanding anything to the contrary contained in this agreement, it is agreed that in the event that either Buyer or Seller wishes to cancel this agreement as may be provided herein during the examination period, they shall be required to provide written notice of their intent to cancel this agreement which notice shall be provided to the other party and to Escrow Agent, not later than Ten (10) days prior to the closing date specified herein. 7. TITLE REVIEW PERIOD. A. Escrow Agent is hereby instructed to deliver to Buyer and Seller, as soon as practicable after the Opening of Escrow, a title commitment for an ALTA extended coverage Owner's title insurance policy (the "Title Report"), together with full, complete and legible copies of all instruments of record referred to therein. Buyer shall pay the premium for the standard portion of the title insurance policy, and Buyer shall pay all costs for any extended coverage and/or endorsements in excess of the cost of a standard coverage policy, if so desired by Buyer. B. Buyer shall have ten (10) days after receipt of the Title Report and the Survey (the "Title Review Period") to give written notice of objection to any matter shown on the Title Report or the Survey. In the event an amended Title Report is issued or an amended Survey is prepared, Buyer shall have ten (10) days from Buyers' receipt of the amended Title Report or Survey within which to give written notice of objection to any matter shown on the amended Title Report or amended Survey. Seller will, within ten (10) days after timely notification of any objection, advise Buyer in writing whether or not Seller will attempt to eliminate or cure any matter to which Buyer has objected. In the event that Seller advises Buyer that Seller will not attempt to eliminate or cure the matter to which Buyer has objected, Buyer, may exercise its options in writing within five (5) days after receipt of Sellers's notice, may elect to (i) waive the objection; or (ii) terminate this Agreement and the escrow. If Buyer fails to give 4 written notice of its election within the time period provided, Buyer will be deemed to have waived the objection. If Seller advises Buyer that Seller will attempt to eliminate any matter to which Buyer has objected, Seller shall use its best efforts to cure such matters on or before the Scheduled Closing Date, provided, however, Seller shall have no liability to Buyer for failure to cure such matters, and in the event such matters are not cured on or before the Scheduled Closing Date, Buyer shall at its option have the right to either (i) terminate this Agreement, or (ii) waive its objections to such matters. Upon termination of this Agreement pursuant to the terms of this paragraph, the escrow provided for herein shall be immediately canceled, the Earnest Money q Deposit, together with all earnings thereon, shall be returned to the Buyer, and Seller and Buyer shall each pay one-half (1/2) of the fees in connection with the escrow or the cancellation thereof. C. If Buyer fails to give written notice of any objection to the Title Report or 4.1 the Survey within the time provided above, Buyer will be deemed to have approved all matters shown on the Title Report and the Survey, and the Property shall be conveyed to the Buyer subject to all such matters. All matters shown on the Title Report and the Survey, except those to which Buyer timely objects are hereinafter referred to as "Permitted Title Exceptions". D. Notwithstanding anything to the contrary in the preceding subparagraphs, Seller shall be obligated to remove any financial liens and monetary obligations without the necessity of Buyers' objecting to said matters. If any monetary liens or encumbrances have not been removed on or before the Scheduled Closing Date, the Buyer may cancel the agreement and obtain refund of the escrow deposit. 8. SELLER'S REPRESENTATIONS AND WARRANTIES. Seller represents, warrants and covenants to Buyer those matters set forth below, with the understanding that Buyer shall rely upon said representations, warranties and covenants. All representations and warranties shall survive the Closing for a period of One (1) year after the entire Property is paid. A. Seller and all persons acting for and on behalf of Seller have the full power, capacity and authority to enter into and deliver this Agreement, to perform all obligations of Seller hereunder, to complete and close this transaction in accordance with this Agreement and to sign, deliver and perform any documents and instruments in connection herewith on behalf of Seller. B. Seller is not aware of any liens, encumbrances, claims of liens or encumbrances, or any possible defects, or claims of defects to the title to the Property which do not appear in the Title Report, and Seller shall protect Buyer against or remove as a lien or encumbrance any such matter arising prior to the Closing except those caused by Buyer. C. The Property is not subject to any written or oral agreement which grants to any person or entity other than the Buyer an option, right of first refusal or other right to acquire any interest in the Property. 5 D. Seller has no knowledge of any pending, threatened or contemplated action of eminent domain or any other public or quasi-public taking of all or any portion of the Property. E. Seller has not authorized any work on the Property which could result in any mechanics' liens, claims of lien or other claims against the Property, and all bills for work done or material supplied to the Property have been paid. Seller shall indemnify, defend, protect and hold Buyer harmless from any unrecorded mechanics', surveyors' or engineers' liens, claims of lien or other claims against the Property occurring or arising for work or services performed at Seller's request to or for the Property prior to the Closing, except for work performed by or on behalf of Buyer. F. To Seller's knowledge, there are not any adverse claims of adjoining property owners against the Property; there are no adverse parties in possession of the Property or any part thereof; and there are no encroachments by Seller on the Property or by others in the Property, except as disclosed in the Title Report. G. To Seller's knowledge, but without any investigation or inquiry of any kind, the Property has not been used by Seller or any of Seller's predecessors in title, nor by anyone else, to generate, manufacture, refine, transport, treat, store, handle, discharge or dispose of hazardous or toxic wastes or substances, except for insecticides, pesticides, chemicals, and other substances used in connection with the growing and harvesting of agricultural products or the preparation or use of the land for agricultural purposes. Seller is not aware of any proceeding or inquiry by any governmental authority with respect to the presence of hazardous materials on the Property or the migration of hazardous materials from or to other property. 9. DISCLAIMER. A. Except as herein specifically set forth, Seller makes no representations or warranties, express or implied, with respect to, and shall have no liability for: (1)the condition of the Property or the suitability of the Property for Buyer's intended use or for any use whatsoever; (2) any applicable building or zoning laws or regulations or with respect to compliance therewith or with respect to the existence of or compliance with any required permits, if any, of any governmental agency; (3) the availability of water, sewer or other utilities; (4) water, sewer or other utility districts; (5) access to any public or private sanitary sewer system; or (6) the presence of any hazardous substances on or under the Property. Without limiting the generality of the foregoing, but subject to the representations set forth in Section 8, Seller shall have no liability to Buyer with respect to the condition of the Property under common law, or any federal, state, or local law or regulation, including but not limited to the Comprehensive Environmental Response, Compensation and Liability Act of 1980 as amended, 42 U.S.C.A. §9601 et seq., or any similar state statutes in Arizona, including but not limited to the Arizona State Superfund Act, as codified in A.R.S. §49-281 through 287, and Buyer hereby waives any and all claims which the Buyer has or may have against the Seller with respect to the condition of the Property (except claims for a breach of Seller's representations and warranties set forth in Section 8), including any private causes of action arising under the foregoing statutes concerning the Property and any conditions in the Property. 6 B. Buyer's failure to terminate this Agreement during the Examination Period shall act as an acknowledgment by Buyer that: (i) during the Examination Period, Buyer has had the opportunity to review the Property to determine if the Property is in violation of any federal, state or local environmental law, rule or regulation or otherwise contains levels or concentrations of"hazardous substances", "hazardous materials", "toxic substances" or "hazardous waste", as such terms are defined in the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended 42 U.S.C. §9601 et seq., the Hazardous Materials Transportation Act 49 U.S.C. §1801 et seq., the Resource Conservation and Recovery Act of 1976, 42 U.S.C. §6901 et seq., or the Toxic Substances Control Act, as amended, 15 U.S.C. §2601 et seq., or analogous provisions of state law; (ii) Buyer is purchasing the Property "as is" in its present condition, subject only to the representations and warranties contained in this Agreement; and (iii) Buyer has fully inspected the Property and assumes the responsibility and risks of all defects and conditions, including such defects and conditions, if any, that cannot be observed by casual inspection. C. By closing the transaction hereunder, Buyer agrees that (i) Buyer shall be deemed to have accepted all risks associated with adverse physical characteristics and existing environmental conditions that may or may not have been revealed by the Buyer's investigation of the Property, (ii) as between the Buyer and the Seller, Buyer shall be deemed to have accepted all costs and liability associated in any way with the physical and environmental condition of the Property, and (iii) the Buyer hereby waives any and all objections, setoffs, claims, or causes of action (whether under a statute or common law) concerning the physical characteristics and existing conditions of the Property, including, without limitation, any environmental hazards. D. Notwithstanding the foregoing disclaimers, waivers and releases, nothing in this Section 9 shall be deemed to relieve Seller of any liability to Buyer for release of hazardous materials or other environmental contamination on the Property caused by Seller or Seller's officers, directors, shareholders, employees, agents, contractors, or invitees; nor shall this Section be deemed to release Seller from liability for breach of any express representations or warranties contained in this Agreement. 10. POSSESSION. Possession of the Property and risk of loss will be delivered to the Buyer at Close of Escrow. 11. CLOSING MATTERS. A. On or before the Scheduled Closing Date, Seller shall deposit with Escrow Agent, for delivery to Buyer at the Closing, the following items, which shall be in form satisfactory to Buyer and be duly executed and acknowledged (where applicable): (i) a Special Warranty Deed conveying fee simple title to the Property to Trustee, subject only to the Permitted Title Exceptions; (ii) an Affidavit of Real Property Value; (iii) an affidavit of Seller's non-foreign status, as required pursuant to Section 20; and (iv) such other documents as may be required by Escrow Agent. 7 B. On or before the Scheduled Closing Date, Buyer shall deposit with Escrow Agent, for delivery to Seller at the Closing, (i) Two Hundred and Two Thousand dollars ($202,000.000) the balance of the purchase price in cash or certified funds. C. All real property taxes and assessments shall be prorated as of the Closing Date on the latest information available to the Escrow Agent. All Escrow fees and all other closing costs shall be charged to and pro rated per standard escrow practice and allocated between the Buyer and Seller. If any tax or assessments affects the property and any additional land not a part of the Property, only that portion of the tax or assessment attributable to the Property shall be prorated between Buyer and Seller, and the remainder of said tax or assessment shall remain the sole obligation of the Seller. The determination of the portion of the tax or assessment attributable to the Property shall take into account the value of improvements (if any) made to the property and/or any other property covered by the tax bill to properly account for differences in the valuation of, and resulting tax or assessment levied against the Property covered by the bill. 12. BROKERS' COMMISSIONS. Buyer and Seller warrant,each to the other, that, there are no fees or commissions owing to any broker or other party for bringing about the sale contemplated hereunder by Buyer. If any other person shall assert a claim to a fee, commission or other compensation on account of alleged employment as a broker or finder or for performance of services as a broker or finder in connection with this transaction, the party hereto under whom the broker or finder is claiming shall indemnify and hold harmless the other party against and from any such claim and all costs, expenses and liabilities incurred in connection with such claim or any action or proceeding brought thereon (including, but without limitation, counsel and witness fees and court costs in I defending against such claim). 13. NOTICES. All notices, requests and other communications hereunder shall be given in writing and either (i) personally served on the party to whom it is given, or (ii) mailed by registered or certified mail, postage prepaid, return receipt requested, or (iii) sent by private overnight courier such as Federal Express or Airborne, or (iv) sent by facsimile to the number set forth below, as long as such facsimile transmission is confirmed as received by the transmission equipment, and is followed the next business day by another permissible means of notice hereunder, addressed as follows: If to Seller: Charles D. Stone and Patricia Stone Co-Trustees of the Stone Living Trust 1790 Forest Meadow Drive Prescott, Arizona 86303 8 With a copy to: If to Buyer: City Attorney City of Prescott 201 S. Cortez Street Prescott, AZ 86302 Phone (928) 777-1274 If to Escrow Agent: Connie Allman Yavapai Title 123 N. Montezuma Prescott, Arizona 86301 928-445-2528 All notices shall be deemed given when delivered or, if mailed as provided above, on the second day after the day of mailing, and if sent by overnight courier, on the next day after the date of deposit with the courier, and if sent by facsimile, upon machine confirmation of receipt. Any party may change his address for the receipt of notices at any time by giving written notice thereof to the other parties in accordance with the terms of this section. The inability to deliver notice because of a changed address of which no notice was given, or rejection or other refusal to accept any notice, shall be deemed to be the effective receipt of the notice as of the date of such inability to deliver or rejection or refusal to accept. 14. SELLER'S REMEDIES. Provided Seller is not in default hereunder, in the event the escrow hereunder fails to close because of a breach by the Buyer or Buyer's inability to satisfy any of the conditions precedent set forth herein, Seller shall not be entitled to specifically enforce this Agreement. In that event, the Earnest Money Deposit that has been deposited into escrow, together with all earnings thereon, shall be released to Seller, free of all claims of Buyer. Seller's sole remedy shall be to retain the Earnest Money Deposit and earnings thereon as liquidated damages. 15. BUYER'S REMEDIES. Provided Buyer is not in default hereunder, in the event the escrow hereunder fails to close because of a breach by the Seller or Seller's inability to satisfy any of the conditions precedent set forth herein, Buyer shall not be entitled to specifically enforce this Agreement. In that event, the Earnest Money Deposit that has been deposited into escrow, together with all 9 earnings thereon, shall be released to Buyer, free of all claims of Seller. Buyers' sole remedy shall be to retain the Earnest Money Deposit and earnings thereon as liquidated damages. 16. RIGHT TO CURE. The breach by either party of any representation or warranty under this Agreement or such party's failure to perform any covenant, condition or obligation hereunder shall constitute a default hereunder, and the non-breaching party may exercise its remedies, including termination of this Agreement, only if such breach or nonperformance continues more than five (5) business days following the date of notice by the other party specifying such breach or nonperformance. 17. AFFIDAVIT OF NON-FOREIGN STATUS; IRS FORM 1099B. Seller shall deliver or cause to be delivered to Escrow Agent at the Close of Escrow an affidavit executed by Seller under penalty of perjury setting forth Seller's taxpayer identification number and stating that Seller is not a foreign person, in accordance with Internal Revenue Code Section 1445(b)(2). Seller shall also execute and deliver to Escrow Agent at the Close of Escrow a copy of IRS Form 1099B for filing by Escrow Agent with the Internal Revenue Service (the "IRS"). Escrow Agent, as the party responsible for closing the transaction contemplated hereby within the meaning of Section 6045(e)(2)(A) of the Internal Revenue Code of 1986, as amended (the "code"), is instructed to file all necessary information reports, returns and statements (collectively the "reports") regarding the transaction required by the Code, including, but not limited to, the reports required pursuant to Section 6045 of the Code. 18. CLOSING PROTECTION LETTER. If Escrow Agent acts as an agent for an underwriter and does not issue policies of title insurance, Escrow Agent agrees that, as a condition to acting as the escrow agent for this transaction, it shall cause its underwriter (the "title insurer") to issue to Seller and Buyer, within twenty (20) days after the Opening of Escrow, an escrow and closing protection letter, insured escrow and closing service, or statement of service responsibility in written form satisfactory to both Seller and Buyer. 19. MISCELLANEOUS. A. This Agreement and the exhibits attached hereto or to be attached hereto, embody the entire agreement between the parties in connection with this transaction, and there are no oral agreements existing between the parties relating to this transaction that are not expressly set forth herein and covered hereby; this Agreement may not be modified except in a writing signed by all parties. B. Time is of the essence of this Agreement. C. In the event either party hereto fails to perform any of its obligations under io this Agreement or in the event a dispute arises concerning the meaning or interpretation of any provision of this Agreement, the sole remedies shall be as specified in paragraphs 15 and 16 respectively, herein. D. The captions and section numbers appearing in this Agreement are inserted only as a matter of convenience, and do not define, limit, construe or describe the scope or intent of such sections or articles of this Agreement nor in any way affect this Agreement. E. This Agreement may be executed in multiple counterparts, each of which shall, for all purposes, be deemed an original and all of which, taken together, shall constitute one and the same agreement. F. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors in interest and assigns; provided, however, that no assignment of this Agreement shall in any way relieve the assignor of its obligations hereunder. Buyer may assign its rights pursuant to this Agreement by giving written notice of such assignment to Seller and the Escrow Agent. G. This Agreement shall be construed and interpreted under, governed and enforced according to the laws of the State of Arizona. H. Cancellation in the Event of Conflict. The parties hereby note that either party hereto may cancel this agreement in the event of a conflict of interest as defined by A.R.S. § 38-511, the provisions of which are incorporated herein by reference. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the last date set forth below their respective signatures. SELLER: BUYER: THE STONE LIVING TRUST CITY OF PRESCOTT By By Charles D. Stone, Co-Trustee Marlin D. Kuykendall Its: Mayor By: Patricia Stone, Co-Trustee =' Attest: Elizabeth A. Burke City Clerk By: Attorney for Seller Approved as to form: By Gary D. Kidd City Attorney AGREEMENT AND CONSENT BY ESCROW AGENT The undersigned, Yavapai Title Company, hereby agrees to (i) accept the foregoing Real Estate Purchase Agreement as instructions to the undersigned, (ii) act as Escrow Agent under said Agreement in consideration of its fees normally charged in such transactions, and (iii) be bound by said Agreement in the performance of its obligations as the Escrow Agent. Dated this day of , 2008. YAVAPAI TITLE AGENCY By: Its: 12