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HomeMy WebLinkAbout11. 12-436 SEPTEMBER 11, 2012 12-436 RESOLUTION (CARRIED___6-0_____LOST________LAID OVER________WITHDRAWN________) PURPOSE: APPROVE AGREEMENT WITH GUNDERSON CLEANERS, INC. FOR DEMOLITION OF BUILDING LOCATED AT 118 HIGH AVENUE INITIATED BY: CITY ADMINISTRATION BE IT RESOLVED by the Common Council of the City of Oshkosh that the attached Agreement with Gunderson Cleaners, is hereby approved and the proper City officials are hereby authorized to execute and deliver the agreement in substantially the same form as attached hereto, any changes in the execution copy being deemed approved by their respective signatures, and said City officials are authorized and directed to take those steps necessary to implement the terms and conditions of the Agreement. CITY HALL 215 Church Avenue P.O.Box 1130 Oshkosh,Wisconsin 903-1130 City of Oshkosh OJHKO.IH TO: Honorable Mayor and Members of the Common Council FROM: Allen Davis, Director of Community Development Lynn A. Lorenson, City Attorney DATE: September 6, 2012 RE: Approval of Agreement with Gunderson Cleaners, Inc. for demolition of building located at 118 High Avenue BACKGROUND Gunderson Cleaners, Inc. is the current owner of the property located at 118 High Avenue in the City of Oshkosh. The building is in a state of disrepair and the City has received complaints about the condition of the building. City inspectors believe that the property presents a danger to the public in its current condition. The building was formerly used as a laundry and dry cleaning operation and is the subject of a Wisconsin Department of Natural Resources case related to environmental contamination. City staff has worked with the owner and the Department of Natural Resources for the past two years in an effort to work through the various issues related to the structure and underlying property. Council is being asked to approve an Agreement with the property owner for demolition of the building and restoration of the property. ANALYSIS The City of Oshkosh by state statute has the ability to issue a Raze Order requiring a property owner to raze or repair any structure which has become so dilapidated or out of repair as to be dangerous, unsafe, unsanitary or otherwise unfit for habitation and unreasonable to repair. If an owner fails to raze or repair a building subject to a raze order, the City may do so, with the costs becoming a lien upon the property. In this case, the property is contaminated and likely has no value. In the case of the property located at 118 High Avenue, the City has determined that the structure meets the criteria for issuance of a raze order. However, because of the existing environmental contamination issues with the property, the City has been working with the owner and the WDNR to address the issues related to the property. The proposed Agreement provides for the demolition of the existing structures upon the property and restoration of the site. In addition, the Agreement provides that the City and Gunderson will negotiate in good faith regarding the future use and ownership of the property. The Agreement does not address remediation of any environmental issues, which remain under the jurisdiction of the WNDR. However, Gunderson has indicated that the remediation of existing contamination will occur in connection with Gunderson's restoration of the property. While the City could simply issue a Raze Order under the statute, the proposed Agreement provides timelines for the demolition and clearly establishes an obligation for the property owner to reimburse the City for any costs related to demolition and restoration of the site, should the owner fail to complete those activities. In this case, the ability to seek reimbursement from the property owner's provides the City additional security to the lien upon the contaminated property. In addition, the Agreement provides the City with the ability to seek reimbursement for certain activities it may perform from the Wisconsin Drycleaner Environmental Response Fund ("DERF") through an assignment from Gunderson Cleaners, Inc. The DERF assignment provides the City an additional source of funds for repayment of certain costs the City may incur. FISCAL IMPACT There is no anticipated fiscal impact from the proposed Agreement. The proposed Agreement would provide the City with additional sources for reimbursement of costs should costs be incurred in demolition or restoration of the structures and property. RECOMMENDATION It is recommended that the Council approve the proposed Agreement. Respectfully Submitted, Approved: l, 4 �s .7KtLf_Ae. Lynn A. Lorenson Mark A. Rohloff City Attorney City Manager A Allen Davis Director of Community Development • SETTLEMENT AGREEMENT This SETTLEMENT AGREEMENT (the"Agreement") is made this day of ,2012,between the City of Oshkosh,Wisconsin(the"City")and Gunderson Cleaners, Inc. f/k/a the King's Laundry("Gunderson"). RECITALS A. Gunderson is the current owner of an approximately 120 foot by 90 foot(.25 acre) rectangular property located at 118 High Avenue, Oshkosh, Wisconsin with the following legal description:NW 1/2 of Lot 2 & All of Lot 1 Blk 8 Original Plat(the"Property"). The Property includes a two-story building with a smokestack and basements under two separate parts of the structure(collectively,the"Building"). The Building was formerly used as a laundry and for a drycleaner operation. B. The Building has been the subject of numerous complaints by the public to the City, and the City believes that the Building is in disrepair and presents a danger to the public. C. Soil and groundwater containing tetrachloroethene and its degradation products (tichloroethene,cis I,2-dichloroethene,and vinyl chloride) are present on the Property (the "Contamination"),mainly beneath the Building and north of the Building. D. The Property is the subject of Wisconsin Department of Natural Resources ("WDNR")BRATS Case number 02-71-467002 and is subject to certain requirements under Wisconsin Statutes chapter 292 and Wisconsin Administrative Code NR 700 series. E. The Building impedes access to the Contamination. NOW, THEREFORE,in consideration of the mutual covenants and conditions below, the receipt and sufficiency of which is hereby acknowledged,the City and Gunderson hereby agree as follows: AGREEMENT 1. Demolition Activities. Gunderson shall completely demolish the above-grade portions of the Building and remove all above-grade debris generated from such demolition (collectively,the"Demolition Activities"). Foundation structures that do not impede access to the Contamination may remain in place. The Demolition Activities shall be completed in accordance with applicable law,on or before November 30, 2012 (the"Demolition Date"). 2. Restoration Activities. Gunderson shall excavate and remediate the Contamination in accordance with applicable law and a Remedial Action Plan approved by WDNR; crush subsurface structures for use as fill;backfill remainder of excavation on the Property with clean, suitable material and shall grade the Property to a finished grade that is compatible with the existing grade in the paved areas of the Property. Restoration Activities shall be completed by the Demolition Date. 3. Building Security. Prior to the Demolition Activities, Gunderson shall continue to secure the Property and the Building in order to prevent public access to the Building, including continuing to work with the adjacent photo studio property owner to prevent access to the Building via the photo studio's roof and continuing to periodically inspect the Building to prevent it from being accessed by unauthorized persons(collectively,the"Security Obligation"). 4. Raze Order. If Gunderson fails to complete the Demolition Activities by the Demolition Date or fails to complete the Restoration Activities by the Restoration Date,the City may immediately issue a Raze Order under Wisconsin Statute section 66.0413 and/or any other state or municipal law authorizing the City to issue such Raze Order,with the agreement that any such Raze Order would not compel any actions beyond the Demolition Activities or Restoration Activities required by this Agreement. Gunderson agrees not to challenge or contest any Raze Order or any finding or condition of such Raze Order issued by the City pursuant to this paragraph. 5. Nuisance Order. The City reserves all rights to issue a Nuisance Order under any applicable statute or ordinance,and Gunderson reserves all rights to contest such Nuisance Order. 6. Reimbursement. In the event Gunderson fails to complete the Demolition Activities by the Demolition Date or fails to complete the Restoration Activities by the Restoration Date or fails to comply with any Raze Order issued by the City under paragraph 4, the City shall have the right to enter the Property to complete the Demolition Activities or Restoration Activities, and Gunderson agrees to reimburse the City's direct and reasonable actual costs of completing the Demolition Activities or Restoration Activities. Gunderson shall reimburse the City for such direct and reasonable actual costs no later than thirty (30)days after the City invoices Gunderson for such actual costs. 7. Assignment of DERF Rights. In the event that Gunderson fails to complete the Restoration Activities or reimburse the City in accordance with paragraph 5 this Agreement, the City may seek reimbursement for any Restoration Activities it undertakes from the Wisconsin Drycleaner Environmental.Response Fund("DERF"). Gunderson hereby assigns its DERF rights to the City, concurrent with the execution of this Settlement Agreement,pursuant to an Agent Agreement under Wisconsin Statutes section 292.65(4)(k), attached hereto as Exhibit A, with the understanding that such assignment does not impose affirmative obligations on the City to conduct the Restoration Activities. 8. No Admission of Liability. Nothing in this Agreement shall be construed as an admission by either party of liability with respect to the Contamination, including but not limited to liability for any off-site migration of the Contamination. 9. Negotiation of End Use. Gunderson and the City agree to negotiate in good faith regarding the future use and ownership of the Property, including but not limited to sale of the property by Gunderson to the City, a potential transfer of the Property to the City or lease of the Property by the City. 10. City Indemnity. Subject to any limitations contained in Wisconsin Statutes, including but not limited to Section 893.80,the City agrees to indemnify and hold harmless Gunderson and all of its officers,officials, directors, employees,agents, shareholders, attorneys, subsidiaries, successors and assigns from any and all claims,causes of action, loss,costs, expense, damage, injury,obligation, liability,penalty, fine, suit,including,without limitation, attorney and consultant fees and expenses, of whatever kind or nature,known or unknown, contingent or otherwise, arising out of or in any way related to the Demolition Activities and where founded upon or growing out of the acts or omissions of the City's officers, employees, or agents while acting within the scope of their employment. 11. No Waiver of Immunity. Nothing in this Agreement is intended as a waiver of the municipality's right or opportunity to rely upon the municipal limitations and immunities contained within Wisconsin law,which include,but are not limited to, Sections 345.05, 893.80, and 893.83,Wisconsin Statutes. Such damage limits, caps and immunities are intended to be preserved and are incorporated into this Agreement and shall govern all disputes, contractual or otherwise, as they apply to the municipality and its agents, officers, and employees. 12. Gunderson Indemnity. Except as specifically set forth herein, Gunderson hereby indemnifies and agrees to hold harmless the City and all of its elected officials,officers, directors, employees,agents, shareholders, attorneys, subsidiaries, successors and assigns from any and all claims, causes of action, loss,costs,expense, damage,injury, obligation, liability, penalty,fine, suit,including,without limitation, attorney and consultant fees and expenses, of whatever kind or nature,known or unknown,contingent or otherwise,arising out of or in any way related to the Demolition Activities or Restoration Activities, and where founded upon or growing out of the acts or omissions of Gunderson or its agents, officers,or employees while acting within the scope of their employment. 13. No Representations; Amendment. Except as specifically provided in this Agreement,there are no representations,covenants, warranties,promises, agreements, conditions,or undertakings, oral or written,between the City and Gunderson,as to the subject matter hereof. Except as otherwise expressly provided herein,no subsequent alteration, amendment, change, or addition to this Agreement shall be binding upon either party unless made in writing by the parties and signed by the parties. 14. Severability. If any provision of this Agreement conflicts with applicable City, state,or federal law, such conflict shall not affect the other provisions of this Agreement which can be given effect without the conflicting provision,and, to this end,the provisions of this Agreement shall be severable, and the invalidity or partial invalidity or unenforceability of any one (1)provision or portion hereof shall not affect the validity or enforceability of the remaining portions of said provision or any other provisions of this Agreement. 15. Assignment. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns,and shall be considered to"run with the land" and bind subsequent owners/occupants of and at the Property,provided,however,that Gunderson may not assign any of its obligations under this Agreement without the express written consent of the City. 3 16. Governing Law. This Agreement shall be construed under the laws of the State of Wisconsin. 17. Time of the Essence. Time is deemed to be of the essence with regard to all dates and time periods set forth herein or incorporated herein. 18. Counterparts. This Agreement,and all other documents or instruments that may be required by this Agreement, may be executed in several counterparts,each of which shall be deemed an original,but all of which shall constitute the same instrument. This Agreement may contain more than one (1) counterpart of the signature page, and may be executed by the affixing of the signatures of each of the signers to one (1)of such counterpart signature pages; all of such counterpart signature pages shall be read as though one(1), and shall have the same force and effect as though all of the signers had signed a single signature page. 19. Access and Purposes. Gunderson hereby permits City, its employees,duly authorized representatives, agents and subcontractors,to enter upon and have rights of ingress and egress over and access at reasonable times to the Property to complete the Demolition Activities and/or Restoration Activities in the event Gunderson fails to complete such activities by the required completion dates. 20. Term. The term of this Agreement will commence upon execution of this Agreement and continue until Gunderson has completed its obligations under this Agreement. Paragraphs 8, 9, 10, 11, and 12 will survive expiration or termination of this Agreement. 21. Notice. Any request, demand or other notice required or permitted to be given under this Agreement shall be in writing and may be,and shall be deemed, given and sent, if mailed,two days after the date when deposited in the United States mail, certified mail,return receipt requested,postage prepaid, or by overnight courier service,telecopy,telegraph or telex when delivered to the appropriate office for transmission, charges prepaid,or by telecopy when received, addressed: If to Gunderson: Gary D. Gunderson,President Gunderson Cleaners,Inc. 41 Main Street Menasha, WI 54952-3198 Telephone: 920-727-4000 Fax: 920-727-4004 E-mail: gg @gundersongroup.com With a copy to: Donald P. Gallo,Esq. Reinhart Boerner Van Deuren s.c. N16 W23250 Stone Ridge Drive, Ste. 1 P.O. Box 2265 Waukesha, WI 53187-2265 Telephone: 262-951-4555 Fax: 262-951-4690 E-mail: dgallo @reinhartlaw.com 4 If to the City: Allen Davis Community Development City of Oshkosh 215 Church Avenue P.O.Box 1130 Oshkosh, WI 54903-1130 Telephone: 920-236-5055 Fax: 920-236-5053 E-mail: adavis @ci.oshkosh.wi.us With a copy to: Lynn Lorenson,Esq. City Attorney City of Oshkosh 215 Church Avenue P.O. Box 1130 Oshkosh,WI 54903-1130 Telephone: 920-236-5115 Fax: 920-236-5106 E-mail: llorenson@ci.oshkosh.wi.us With a copy to: Arthur J. Harrington,Esq. Godfrey&Kahn S.C. 780 N. Water Street Milwaukee, WI 53202-3512 Telephone: 414-273-3500 Fax: 414-273-5198 E-mail: aarrington@gklaw.com All parties shall acknowledge in writing the receipt of any notice delivered in person. IN WITNESS WHEREOF,the parties have executed this Agreement on the date first written above. GUNDE N CLE - ER:) THE CITY OF OSHKOSH By: . '""° k �L By: , Mayor Attest: , City Clerk APPROVAL OF COMMON COUNCIL This Agreement was approved by the Common Council of the City of Oshkosh by Resolution dated the day of ,2012. 5 Exhibit A AGENT AGREEMENT THIS AGENT AGREEMENT is dated as of ,between Gary Gunderson, d/b/a Gunderson Cleaners, Inc. ("Drycleaner")and City of Oshkosh,("Agent"). The Drycleaner owns the property located at 118 High Avenue, Oshkosh, Wisconsin (the "Site"). The Drycleaner owned and operated a drycleaning facility at the Site until 1987. Pursuant to the Drycleaner Environmental Response Program("DERP"), Wisconsin Statute § 292.65(4)(k),Agent and Drycleaner enter into this Agent Agreement to allow the Agent to act as an agent for Drycleaner in conducting the remedial action activities at the Site if required under Wisconsin Statute § 292.65(4)(e j) and Wisconsin Administrative Code chapters NR 169,and the NR 700 series. Date: ._ 42— k Gary underson Date: City of Oshkosh 82775427 7