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06. Hockaday LeaseiheCiryofNallspell Incorporated 1892 Telephone (406) 758-7700 Douglas Rauthe FAX (406) 758-7758 Mayor Post Office Box 1997 Kalispell, Montana Bruce Williams Zip 59903-1997 City Manager City Council Members: Date: April 2, 1996 Gary W. Nystul Ward I TO: Al Thelen, City Manager Cliff Collins Mayor and City Council Ward I Norbert F. Donahue From: Amy Robertson Ward II Finance Director Dale Haarr Ward II RE: Hockaday expenses Jim Atkinson Ward III I believe the distribution of the Hockaday budget to electric, gas, etc. was done Lauren Granmo arbitrarily by me during the budget process when this budget was last increased. Ward III It would be easier to track if we show just one line item for Hockaday building Pamela B. Kennedy maintenance for the entire budget. I will propose this for the FY97 budget. ward IV M. Duane Larson Since paying the March bills the Hockaday has spent $4,781 of its $6,600 budget. Ward IV The building maintenance line item is over, while the electric and contract services line items are under budget. We will make a line item transfer at year end to balance individual line items. A single line item budget would simplify this process. For your information, the FY95 budget was $4,500 for which we processed claims of $3,580. They also submitted a $1,000 claim for the phone system which we processed through the TIF budget which they had for capital improvements. I believe they thought that $1,000 came off their $4,500 budget which is why they did not submit additional claims for maintenance. LEASE AGREEMENT THIS AGREEMENT, made and entered into this 1st day of April, 1996, by and between THE CITY OF KALISPELL, a municipal corporation, hereinafter called CITY, and the HOCKADAY CENTER FOR THE ARTS, a non-profit corporation, hereinafter called CENTER; W I T N E S S E T H: WHEREAS, on the 13th day of May, 1981, the parties did enter into an agreement whereby CITY leased to the CENTER that certain premises known as Hockaday Center for the Arts, and owned by the CITY, more particularly described as follows: Lots 1 and 2 of Block 64, of Kalispell, Montana, according to the map or plat thereof on file and of record in the office of the County Clerk and Recorder of Flathead County, Montana. WHEREAS, such lease of said premises has been found to have been to the mutual benefit of the parties and to the people of the City of Kalispell and Flathead County; and WHEREAS, it is the intent of the parties that a similar lease arrangement should be continued; NOW, THEREFORE, the CITY does demise, lease and let to the CENTER, and CENTER does agree to lease and rent from the CITY said premises under the following terms and conditions: 1. Term: The terms of this lease agreement shall be for a period of five (5) years commencing April 1, 1996. 2. Consideration: The CENTER shall pay to the CITY, as rent, the sum of $1.00 per year in advance; receipt of the rental for the first year of this term of this lease is hereby acknowledged by the CITY. Rent for subsequent years of the term of this lease is due and payable on the annual anniversary date hereof. 3. Insurance: A) The CITY shall insure said premises for fire damage, extended coverage and other risks which it may choose in such amounts and for such terms as the CITY shall deem advisable. All policies carried by the CITY shall provide that, in the event of a loss, all payments under them shall be made solely to CITY. CENTER waives all claims for compensation for any loss or damage sustained by reason of fire or other casualty occurring on the demised premises. In the event the demised premises or any part thereof is damaged by fire or other casualty which in the judgment of the CITY renders fulfillment of this Lease Agreement by the CITY 1 impossible, the CENTER releases the CITY and its agents form all demands, claims, and causes of action arising from any of these causes. B) The CENTER shall insure the contents of said premises as the CENTER shall deem advisable. All policies carried by CENTER shall provide, that in the event of loss, all payments shall be made solely to CENTER. C) The CENTER shall maintain a policy of insurance in the sum of at least $750,000 per person/$1,500,000 per occurrence insuring CITY against any and all personal injury or property damage that may occur on said premises from any and all causes. CENTER shall furnish to the CITY a certificate reflecting such insurance is in full force and effect at all times during the term of this lease and while CENTER is in possession of said premises. Said insurance shall contain a clause requiring that the CITY be given at least 30 days notice of termination or cancellation thereof. 4. Utilities: The CITY shall pay for utilities (water, gas and electricity) costs incurred by the CENTER, provided that said costs do not exceed $ per year. In the event said costs do exceed $ per year, the CENTER shall be responsible for the excess. 5. Maintenance, Repairs and Alterations: The CENTER shall keep and maintain said premises in a good repair and in a neat condition and shall not commit or permit waste to occur thereon. No major repairs or alterations of any kind shall be made on said premises without the CENTER having obtained written permission therefor from the City Council and agreement as to the funding therefor. All fixtures and additions of any kind made to said premises shall become the property of the CITY. The CENTER shall be responsible for all maintenance and repairs of utility service facilities on said premises during the term of this lease, and shall further be required to and be responsible for maintenance of lawn and shrubs and removal of ice and snow. 6. Reimbursement: CITY shall reimburse CENTER for maintenance and repair costs up to $ per year . Nothing contained in this paragraph shall prohibit the CITY from making available, to the CENTER, through the budgetary process such additional sums as the CITY deems necessary to perform maintenance upon the property leased to the CENTER. E 7. Use: Said premises is intended for and may be used only for the exhibition and display of the visual and performing arts, as well as lectures, public and private meetings, readings, discussion groups, gallery talks and recitals in music, dance, drama and other related arts and for classes and instruction in the arts and crafts, particularly those incidental to this area. In addition to the foregoing, the premises may be used for a sales gallery operated by the CENTER to develop and exhibit local artists and such other artists as CENTER may wish to include, the proceeds from said gallery to go to the CENTER. 8. Assignability: This lease is not assignable; however, the CENTER may sublet, with City Council approval, on a temporary basis, portions of said premises for uses connected and logically associated with the intended cultural use of the premises. 9. Miscellaneous: CENTER shall, on or before October 1, of each year of this lease, furnish to the City a general budget as adopted by CENTER for the ensuing year. Also, CENTER shall, upon request of the City Council, furnish information covering the operating policies and costs of operation of said premises. 10. Termination: This lease may be terminated by CENTER upon 90 days written notice to the CITY. Same may be terminated by the CITY upon 90 days written notice for delinquency in payment of rent or violation of any covenant hereinabove contained unless such delinquency or violation be corrected within said 90 day period. IN WITNESS WHEREOF, both parties have hereunto set their hands and seals this day of April, 1996. ATTEST: Debbie Gifford, CMC Clerk of Council 3 THE CITY OF KALISPELL WN Interim City Manager ATTEST: By Secretary HOCKADAY CENTER FOR THE ARTS By President STATE OF MONTANA : ss County of Flathead } On this day of , 1996, before me, the undersigned, a Notary Public for the State of Montana, personally appeared AL THELEN and DEBBIE GIFFORD, known to me to be the Interim City Manager and Clerk of Council of the municipal corporation that executed the within and foregoing instrument and acknowledged to me that such municipal corporation executed the same. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my Notarial Seal the day and year first above written. Notary Public, State of Montana Residing at Kalispell, Montana My Commission expires STATE OF MONTANA } : ss County of Flathead ) On this day of , before me, the undersigned, a Notary Public for the State of Montana, personally appeared and , known to me to be the President and Secretary, respectively, of the non-profit corporation that executed the within instrument, and acknowledged to me that such corporation executed the same. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my Notarial Seal the day and year first above written. Notary Public, State of Montana Residing at Kalispell, Montana My Commission expires 5