HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 11/16/2010 - FIRST READING OF ORDINANCE NO. 118, 2010, AUTHORIZ DATE: November 16, 2010 1
STAFF: Steve Comstock • . • 3M
•
First Reading of Ordinance No. 118, 2010, Authorizing the City to Enter into a Livestock Grazing Lease for Meadow
Springs Ranch.
EXECUTIVE SUMMARY
In August 2010, the City issued a request for proposals for a new grazing lease at Meadow Springs Ranch. Of the
eleven interested parties, two proposals were received. The Selection committee awarded the lease to Natural Fort
Grazing Inc. based on a superior proposal. Natural Fort Grazing has held the lease since the City took over ownership
in 1990. The proposed new lease is very similar to the previous lease. It is for ten one-year terms and 1100 animal
units over a six month period each year. The new lease rate will average $16 per animal unit, which represents an
increase of$3 per unit. This is an excellent rate compared to the area average of around $12.50 per unit. The total
potential revenue generated will be $1.056 million.
BACKGROUND / DISCUSSION
The City Wastewater Utility purchased Meadow Spring Ranch for its biosolids program in two allotments in 1990 and
in 1993. The purchase price was about$100 dollars per acre totaling approximately$2.6 million dollars. The current
acreage owned is 26,680 acres.The cattle grazing program has occurred each year since the City purchased Meadow
Springs Ranch in 1990. Grazing revenue collected to date is approximately$1.7 million.
FINANCIAL / ECONOMIC IMPACTS
The lease represents a solid financial return that off sets both the cost of the City's biosolids program and the
environmental programs at Meadow Springs Ranch.
STAFF RECOMMENDATION
Staff recommends adoption of the Ordinance on First Reading.
BOARD / COMMISSION RECOMMENDATION
At its October 21, 2010 meeting, the Water Board vote unanimously to recommend approval of the 2010 Meadow
Springs Ranch Grazing Lease.
ATTACHMENTS
1. Location map
2. Water Board minutes (draft), October 21, 2010
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ATTACHMENT
Excerpt from Unapproved Water Board Minutes, October 21,2010
Meadow Springs Ranch Grazing Lease
(Presentation available on request)
Water Reclamation and Biosolids Manager Steve Comstock, presented an update on
grazing activities at Meadow Springs Ranch. This year's lease has once again been
awarded to Natural Fort Grazing, Inc. who has held the lease since the City took
ownership of the Ranch in 1990. The lease is based on a ten year term and serves 1100
animal units over a six month period each year. The grazing company offers an excellent
rate at $16 per unit compared to the area average of approximately $12.50 per unit.
Potential revenue will be $1.056 million dollars.
Motion: Vice Chairperson Balderson moved that the Water Board recommends
that City Council approve the proposed 2010 Meadow Springs Ranch Grazing
Lease. Board Member Brown seconded the motion.
Vote on the motion: It passed unanimously.
ORDINANCE NO. 118, 2010
OF THE COUNCIL OF THE CITY OF FORT COLLINS
AUTHORIZING THE CITY OF FORT COLLINS TO ENTER
INTO A LIVESTOCK GRAZING LEASE AGREEMENT FOR
MEADOW SPRINGS RANCH WITH NATURAL FORT GRAZING, LTD.
WHEREAS, in late 1990,the City purchased that certain real property commonly known as
the Meadow Springs Ranch, which has been expanded in the years since by the acquisition of
additional adjacent parcels(together referred to herein as the "Property")for use by the Wastewater
Utility for its biosolids application program; and
WHEREAS, since purchasing the Property, the City has leased it each year for livestock
grazing purposes; and
WHEREAS, in August 2010, City staff issued a request for proposals to lease the Property
for livestock grazing purposes for ten (10) one-year terms, and in response, the City received two
proposals which were reviewed, resulting in the proposal of Natural Fort Grazing, Ltd. ("NFG")
being selected; and
WHEREAS,City staff and NFG representatives have negotiated a Grazing Lease Agreement
(the "Lease"), which Lease is on file in the office of the City Clerk; and
WHEREAS, on October 21, 2010, the Water Board considered the proposed Lease of the
Property, and voted unanimously to recommend that the City Council approve the Lease as
proposed; and
WHEREAS, Sections 23-111 and 23-114 of the City Code authorize the City Council to
lease, for a definite term of more than two years, any and all interest in real property owned by the
City which is part of a City utility system, provided the City Council first finds, by ordinance, that
the lease is in the best interests of the City, that the lease will not materially impair the viability of
the City's affected utility system as a whole, and that the lease will be for the benefit of the citizens
of the City.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT
COLLINS as follows:
Section 1. That the lease of the Property pursuant to the terms of the Lease is in the best
interests of the City, that the Lease will not materially impair the viability of the City's Wastewater
Utility system as a whole, and that the Lease will be for the benefit of the citizens of the City.
Section 2. That the City Manager is hereby authorized to execute such the Lease and
such additional documents as are necessary to lease the Property to NFG or its successors or
approved assigns on terms and conditions consistent with this Ordinance and substantially similar
to those set forth in the Lease, together with such additional terms and conditions or subsequent
amendments or corrections as the City Manager,in consultation with the City Attorney,determines
are necessary or appropriate to protect the interests of the City, including, but not limited to, any
necessary changes to the legal description of the leased area, as long as such changes do not
materially increase the size or change the character of the leased area.
Introduced and considered favorably on first reading and ordered published this 16th day of
November,A.D.2010,and to be presented for final passage on the 7th day of December,A.D.2010.
Mayor
ATTEST:
Chief Deputy City Clerk
Passed and adopted on final reading this 7th day of December, A.D. 2010.
Mayor
ATTEST:
City Clerk