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Item S2BOARD OF COUNTY COMIVIISSIONERS AGENDA ITEM SUMMARY Meeting Date: 10/19/11 - KW Division: County Attorney Bulk Item: Yes X No Staff Contact Person: Suzanne Hutton, x 3470 AGENDA ITEM WORDING: Approval of an Agreement with the City of Key West (City) and the Key West Botanical Garden Society, Inc. (KWBGS) authorizing payment of $24,206.00 to the City to settle the dispute regarding clean-up costs for the site of the old Public Service Building which was transferred to the City on July 26, 2005 and subsequently leased to the Key West Botanical Garden Society, Inc. by the City. ITEM BACKGROUND: On 7/26/05 the County transferred the site of the old Public Service Building to the City after providing to the City Phase I and Phase II Environmental Site Assessments. The 5/2/05 Option Agreement for Sale and Purchase provides that "..except for those findings and conditions identified in the Property's Phase I and Phase II Environmental Site Assessment, Seller warrants and represents... [that due to] the best of Seller's knowledge, no underground treatment, buried, partially buried or above ground storage tanks, storage vessels, sumps, drums, containers, water, gas or oil wells, or landfills are or have ever been located on the property." The City leased the site to the Key West Botanical Garden Society to develop as a botanical garden and incorporate with the existing adjacent botanical garden. In the summer of 2008, while excavating for installation of a pond, KWBGS encountered what appeared to be oil contamination and $47,018 was incurred for clean-up, removal and post clean-up assessment, prior to interest and late charges which were incurred. In a letter dated 4/2/09, the City requested payment of certain bills related to the environmental assessment conducted for KWBGS and the subsequent clean-up of oil contamination. The County recognizes that even after its 2003 removal of considerable oil -contaminated soil and obtaining an environmental assessment in 2005 which required no further action, there may have remained residual and undetected contamination. The City has expended approximately $24,000 in addressing the invoices, before interest and penalties. KWBGS has paid most of the bills for assessment, clean-up and removal in order to continue with its development of the botanical garden but the County is not in privity with the KWBGS for the possession and operation of the site and is only in privity with the City regarding the possession and ownership of the property. Upon payment of the $24,206.00 by the County to the City under this agreement and the out-of-pocket expenditures already made by the City, and the application of the settlement monies to be applied to the outstanding invoices, all three parties have agreed to hold each of the other parties harmless from any and all claims for assessments and/or cleanup of any contamination from the fuel tank removed and remediated first by the County and subsequently by KWBGS as the lessee of the City. PREVIOUS RELEVANT BOCC ACTION: 7/26/2005 County transferred the site of the old Public Service Building to the City of Key West, FL CONTRACT/AGREEMENT CHANGES: N/A STAFF RECOMMENDATIONS: Approval. TOTAL COST: $24,206.00 INDIRECT COST: N/A BUDGETED: Yes No DIFFERENTIAL OF LOCAL PREFERENCE: N/A COST TO COUNTY: $24,206.00 SOURCE OF FUNDS: REVENUE PRODUCING: Yes _ No X AMOUNT PER MONTH Year APPROVED BY: County Atty X OMB/Purchasing Risk Management DOCUMENTATION: Included X Not Required DISPOSITION: AGENDA ITEM # Revised 2/05 AGREEMENT THIS AGREEMENT is entered into this C th day of 2011, between the Board of County Commissioners of Monroe Coun (County , Florida, a pofiticai subdivision of the State of Florida, the City of Key West (City), a municipality incorporated in the State of Florida, and the Key West Botanical Garden Sodety, Inc. (KWBGS), a not -for -profit organization, as follows: WHEREAS, the County transferred the site of the old Public Seance Building (PSt3) to the City on July 26, 2005, after providing to the Gity Phase 1 and Phase 2 Environmental Slte Assessments; and WHEREAS, the May 2, 2005, Option Agreement for Sale and Purchase providesthat'except for those findings and conditions identified in the Property's Phase I and Phase 11 Environmental Site Assessments, Seller warrants and represents .-- [that due to] the best of Seller's knovAedge, no underground treatment, buried, partially buried or above ground storage tanks, storage vessels, sumps, drums, containers, water, gas or oil wells, or landfills are or have ever been located on the property:" and WHEREAS, the 2005 Phase S report recommended a Phase 2 assessment due to the fact that there had been a fuel tank on the premises and that when it was removed in 2003. samples disclosed contamination, as a result of which contaminated soil was removed. The Phase 2 assessment, certified to the City of Key West and the Florida Community Trust on JuM. 7, 2005, stated in summary: "The testing of the Public Service Building Site revealed that no heavy metals were found in the soils that are above action levels. The ground water under the old tank site tested below action levels. This Phase Two Report and the findings of the testing wilt recommend 'No Further Action'! WHEREAS, the City leased the site to the Key West Botanical Garden Society (KWBGS) to develop as a botanical garden and incorporate with the existing adjacent botanical garden; and WHEREAS, in the summer of 2008, while excavating for installation of a pond, KWBGS encountered what appeared to be oil contamination; and WHEREAS, $47,018 was incurred fvr clean-up, removal and post dean -up assessment, prior to interest and tale charges which were incurred; and WHEREAS, in a letter of April 2, 2009, the City requested payment of certain bills related to the environmental assessment conducted for KWBGS and Me subsequent clean-up of oll contamination; and WHEREAS, the County recognizes that even after its 2003 removal of considerable dd- contaminated soil and obtaining in 2005 an environmental assessment which required no further action, there may have remained residual and undetected contamination; and WHEREAS, it is desired to settle the outstanding issues between the County, City, and KWBGS regarding this matter, and WHEREAS, the City has expended approximately $24.000 in addressing the invoices, before interest and penalties; and WHEREAS, KWBGS has paid most of the bills for assessrneM dean -up, and removal in order to continue with its development of the botanical garden, but the County is not in privily with the KWBGS for the possession and operation of the site, and is only in privity with the City regarding the possession and ownership of the property; NOW THEREFORE, the parties agree as',Wbwrs: `f) The County, City and KWBGS agree to settle the dispute regarding the site of the old Public Service Building transferred to the City on duly 26, 2005, and which was reflected in a deed recorded at the Official Records of Monroe County, OR Book 2136 Pages 2453-2471 _ 2) Upon execution of this agreement by both parties, the County will pay to the City the sum of $24,206.00. 3) In consideration of the $24,205.00 to be paid by the County under this agreement and the out- of-pocket expenditures already made by the City in addressing the contaminants at the site, and the application of the settlement monies to be applied to the outstanding invoices, all three parties hereby hold each of the other parties harmless from any and all claims for assessments and/or clean-up of any contamination from the fuel tank removed and remediaied first by the County and subsequently by KVVBGS as the lessee of the City. IN WITNESS WHEREOF, the parties hereto have caused this agreement to be executed the day and year first above written. (SEAL) Attest_ DANNY L KOL_HAGE, Cleric sy Deputy Clerk (SEAL) Attest~ , Clerk Clerk n BOARD OF COUNTY COMMISSIONERS OF MONROE COUNTY, FLORIDA gy Mayor/CWwrnan Y -%-,,, CITY OF KEY WEST, FLORIDA . a r � A. ri U s IBy i cry Manager KEY WEST BOTANICAL GARDEN SOCIETY, INC. r a �S (r �0-) G S President o I City Clerk �Ir Z 1 t County, City & KWBGS Ag 2 RELEASE OF ALL CLAIMS This Indenture witnesses that I, Rick Harty, President, on behalf of the Key West Botanical Garden Society, Inc., for good and valuable consideration, to wit: a settlement agreement between the City of Key West, Monroe County and Key West Botanical Garden Society, Inc. involving soil contamination and the City of Key West's payment toward the resolution of said issue in excess of $24,000.00, do hereby for my heirs, personal representatives and assigns, release and forever discharge Gallagher Bassett Services, Inc., Employer's Mutual Inc., the City of Key West, and all other persons, firms or corporations charged or chargeable with responsibility or liability, their heirs, representatives or assigns, from any and all claims, demands, damages, costs, expenses, loss of services, actions and causes of action arising from any act or occurrence up to the present time, and particularly on account of all property damages, loss or damages of any kind sustained or that I may hereafter sustain in consequence of the removal and disposition of soil from the Key West Botanical Garden Society site that occurred on or about the month of June, 2008, at or near 5210 College Road located in Key West, Florida. To procure payment of said sum, I thereby declare that I am more than 18 years of age; that no representation about the nature and extent of said damages made by any attorney or agent of any party hereby released, nor any representations regarding the nature and extent of legal liability or financial responsibility of any of the parties released, have induced me to make this settlement; that in determining said consideration there has been taken into consideration not only the ascertained damages, but also the possibility that the damages sustained may be uncertain and indefinite, so that consequences not now anticipated may result from the removal of said soil described herein. Page 1 of 2 The undersigned enters into this agreement as an authorized representative of the Key West Botanical Garden Society, Inc., said authority being granted to the undersigned at a meeting of its Board of Directors held on 1/21/2011. The undersigned agrees, as a further consideration and inducement for this compromise settlement, that it shall apply to all unknown and unanticipated damages resulting from the removal of said soil described herein, as well as to those now disclosed. I understand that the parties hereby released admit no liability of any sort by reason of said removal of soil described herein and that said consideration and settlement in compromise is made to terminate further controversy respecting all claims for damages that I have heretofore asserted or that I or my personal representatives or other representatives of the Key West Botanical Garden Society, Inc., might hereafter assert because of said removal. Signed and sealed this day of 2011. RICK HARTY, Pre ' ent KEY WEST BOTANICAL GARDEN SOCIETY, INC. STATE OF FLORIDA ) COUNTY OF MONROE ) On the I q i day of Z F1 , 2011 before me personally appeared RICK HARTY (Personally Known/Identification Provided: kmw"I ' s), to me known to be the person who executed the foregoing instrument, and acknowledged that RICK HARTY executed same as a free act and deed. r (SEAL) 1AURIEFREELM - W COWSM # DNIDMU PUB ST E OF FLORIDA EXPIRES: May 2Z 2012 My Commission Expires: _ 71WUN0"ft,un67hN Page 2 of 2 7 ZYT CITT OF KET WE Srl; FLORTA4 RECEIVED `%1 a4EE c. SEP 16 2011 5 MONROE COUNTY TTORNEY Eg4.'f� MEMORANDUM To: Suzanne Hutton, County Attorney From: Ron Ramsingh, Asst. City Attorney RE: Settlement agreement and waiver from the Botanical Gardens Dear Suzanne, Please find attached the original executed settlement agreement signed by Jim. I also included a copy of the City Commission's Resolution to this effect and the waiver from Rick Harty. Please note that Rick's signature on both the Agreement and the Waiver are not originals as I never received same. Hopefully, this will be sufficient to place on your agenda. Please feel free to call my office at 809-3775 if you have any questions or concerns. FROM THE DESK OF: 1525 Angela Street I PHONE (305) 809-3775 RON RAMSINGH, ESQ. Key West, Florida FAX (305) 809-3771 ASSISTANT CITY ATTORNEY 33040 E-MAIL rramsing@keywestdty.com AGREEMENT THIS AGREEMENT is entered into this 6th day of 2011, between the Board of County Commissioners of Monroe County (County , Florida, a political subdivision of the State of Florida, the City of Key West (City), a municipality incorporated in the State of Florida, and the Key West Botanical Garden Society, Inc. (KWBGS), a not -for -profit organization, as follows: WHEREAS, the County transferred the site of the old Public Service Building (PSB) to the City on July 26, 2005, after providing to the City Phase 1 and Phase 2 Environmental Site Assessments; and WHEREAS, the May 2, 2005, Option Agreement for Sale and Purchase provides that 'except for those findings and conditions identified in the PropWs Phase I and Phase 11 Environmental Site Assessments, Seller warrants and represents ... [that due to] the best of Seller's knowledge, no underground treatment, buried, partially buried or above ground storage tanks, storage vessels, sumps, drums, containers, water, gas or oil wells, or landfills are or have ever been located on the property,' and WHEREAS, the 2005 Phase 1 report recommended a Phase 2 assessment due to the fact that there had been a fuel tank on the premises and that when it was removed in 2003, samples disclosed contamination, as a result of vd*% contaminated soil was removed. The Phase 2 assessment, certified to the C'd y of 6Cey West and the Florida Community Trust on June 7, 2005, stated in summary'. 'The testing of the Public Service Building Site revealed that no heavy metals were found in the soils that are above action levels. The ground water under the old tank site tested below action levels. This Phase Two Report and the findings of the testing will recommend 'No Further Action'.' WHEREAS, the City leased the site to the Key West Botarical Garden Society (KWBGS) to develop as a botanical garden and incorporate with the existing adjacent botanical garden; and WHEREAS, in the summer of 2008, while excavating for installation of a pond, KWBGS encountered what appeared to be oil contamination; and WHEREAS, $47,018 was incurred for clean-up, removal and post dean -up assessment, prior to interest and late charges which were Is and WHEREAS, in a letter of April 2, 2009, the City requested payment of certain bills related to the environmental assessment conducted for KWBGS and the subsequent clean-up of oil contamOvilion; and WHEREAS, the County neoognizes that even after its 2003 removal of considerable oil - contaminated soil and obtaining in 2005 an envuonmental assessment which required no further action, there may have remained residual and undetected contamination; and WHEREAS, it is desired to settle the outstanding issues between the County, City, and KWBGS regarding this matter, and WHEREAS, the City has expended approximately $24,000 in addressing the invoices, before interest and penalties; and WHEREAS, KWBGS has paid most of the bills for assessment, dean -up, and removal In order to continue with its development of the botanical garden, but the County Is not in privity with the KWBGS for the possession and operation of the site, and is only in privity with the City regarding the Possession and ownership of the property: NOW THEREFORE, the parties agree as follows; 1) The County, City and KWBGS agres to settle the dispute regarding the site of the old Public Service Building transferred to the City on July 26.2005, and which was reflected in a deed recorded at the Official Records of Monroe County, OR gook 2136 Pages 2453-2471. 2) Upon execution of this agreement by both parties, the County will pay to the City the sum of $24,206.00. 3) In consideration of the $24,206.00 to be paid by the County under this agreement and the out of -pocket expenditures already made by the City in addressing the contaminants at the site. and tite application of the settlement monies to be applied io the autstand"mg ttvoioes, all three Parties hereby hold each of the other parties harmless from any and all claims for assessments and/or clean-up of ary con'amina5W from the fuel tank removed and reinmMW first by the County and subsequently by KWBGS as the lessee of the City. IN WITNESS WHEREOF, the parties hereb have caused this agreement to be executed the day and year first above written. (SEAL) Attest: DANNY L KOLHAGE, Clerk sy Deputy Clerk (SEAL) Attest . Clerk BOARD OF COUNTY COMMISSIONERS OF MONROE COUNTY, FLORIDA By Mayor/Chamnan CITY OF KEY WEST, FLORIDA Clerk ,� cry Manager A / KEY WEST BOTANICAL GARDEN SOCIETY, JNC. BY City Clerk President 7 k 2011 County, City 3 KWBGS Ag This Indenture Wat leseth that I, hick Harty, President; on behalf of the Key Nest Botanical Garden Society, Inc., for good an valuable consideration, to wit a settlement agreement between the City of Key West, MOn oe County, and Key West Botan'cal Garden Society, Inc. involving soil coaammatlon and the City of Key West's payment toward the re olt&on of sand issue in excess of S24,4D_00, do hereby formy hens, personad represmtaaves and awgnS, release and forever dwlmge Gallagher Bassett Services, Inc., Employees MutLml. Inc., 'The City of Key West, and all other person, firm or corporation charged or �geable WI& respond or Iiabllitiy, thedr hens, rgxwentatives or assigns, from any and an claims, dads, damages, loss of servicex, actions and causes of action arising from any act or owareace up to the present time, and pmr&Wady on apt of in property damages, loss or damages of any l nd sustained or fl at I may hereafter sustsia in consequc= of the removal and disposition of soul from the lKey West Bbtmi at Csadm somety site that owed on or about the maarth of fuse, 2009, at or near 5210 College Road located m Key West, FL. To prw=paymmA of said. =03� I thereby declam did I amp mane than 18 yrs of age; that no rep on about tare nab and eft of said dmagm. made by any attorney or agent of any party hereby released, nor any moms reg the nature and extent of legal li&Dity or financial r bfl-IIY of nay of the parties released, have induced me to make this stock mew that imp detamini said consideration there has been takmrinto core not only the ascmlmed damages, but also the possibility that the damages may rmc ertam and indefinite, so that consequences not now anticipated may =snit from the removal of said soil descn"bed het The Undersigned Mters into this aVeement as an authorizedmPresenteive ofthe Key West Botanical Gwden Society, 131% said m g granbd to the midersigned at a meeting of its Board OfDhectors held ou 21 Z t Z 0 1 The Undersigned agrees, as a fm lher consideration and inducement for this compromise settlement, that it sbaIl apply to all unlmown and unanticipated damages resulting from the removal of said sort descn�ed herein, as well as to those now •_f P-5_ . I understand fliat fihe parties hereby released admit no liability of any sort by reason of said removal of soil descbed herein and that said consideration and seffernent in compromise is made to tCMainAe fib controversy respectmg all claims for damages that I have. heretofare mated or that I or my Pw-vug des or other reproves the Key West Botanical Gatden Society, luc-, migbt hereafter assert because of said removaL Signed and sealed this % day of —1�' 2(}1 Y . Rick Harty NOTARY: ME on ---75 � o'l��/ before me peasmaliy appeared Rick Harty, to me ]mown to be the parson o executed. the forgoing mslnment, and acknowledged that Rick Harty executed same as a fee act and deed. WRY JAMISON _ s flttlary Public -Stab of Florida ��_ •a My Comte. Expires Aug 5.2013 Ui a ComndBelon # DD 91431E DUN 7WO f Notan Assn. My commission MTh= _I�PERSONAII_.Y KNOWN ]7)1;1NiMCA'FiE?N PROVIDED : RESOLUTION NO. 11-247 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF KEY WEST, FLORIDA, APPROVING THE ATTACHED AGREEMENT BETWEEN THE CITY, MONROE COUNTY AND THE KEY WEST BOTANICAL GARDEN REGARDING REMEDIATION COSTS FOR THE FORMER MONROE COUNTY PUBLIC SERVICE BUILDING SITE ON THE PROPERTY LOCATED AT 5210 COLLEGE ROAD; PROVIDING CONDITIONS; PROVIDING FOR AN EFFECTIVE DATE WHEREAS, City staff recommends approval of the attached Agreement to resolve costs incurred during clean up of oil contamination on the site of the former Public Service Building; and NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF KEY WEST, FLORIDA, AS FOLLOWS: Section 1: That the City Manager is hereby authorized to execute on behalf of the City of Key West the attached Agreement among the City, Monroe County and the Key West Botanical Garden, Inc., and to accept payment from the County in the amount of $24,206.00. Section 2: That the attached Release regarding fill that was removed from the site is hereby approved acknowledged. 1 Section 3: That this Resolution shall go into effect immediately upon its passage and adoption and authentication by the signature of the presiding officer and the Clerk of the Commission. Passed and adopted by the City Commission at a meeting held this 6th day of September , 2011. Authenticated by the presiding officer and Clerk of the Commission on September 7 , 2011. Filed with the Clerk September 7 , 2011. A S CHERYL SMIT CITY CLERK CRAIG ES, MAY 2 OFFICE OF THE CITY ATTORNEY THE CITY OF KEY WEST POST OFFICE BOX 1409 KEY WEST, FL 33041-1409 W W W.KEYWESTCITY.COM EXECUTIVE SUMMARY To: the City Commission for the City of Key West From: Ron Ramsingh, Assistant City Attorney Date: July22, 2011 RE: Settlement of the Botanical Gardens remediation. PHONE: (305) 809-3770 FAX- (305) 809-3771 Action statement: For the City Commission to consider a pre -suit settlement proposal regarding the payment of bills pertaining to remediation of contaminated soil at the Botanical Gardens. Background: The Property that now houses the Botanical Gardens was purchased by the City from Monroe County on May 2, 2005. Since the parcel.was previously used by the County as their Public Services Building, an environmental assessment had to be performed since the previous use also involved the storage of fuel tanks. The Phase One discovered contamination from an underground fuel/oil tank. A Phase Two study was subsequently done during this same time period; May -June 2005. An extensive remediation effort was done by the City's tenant; the Botanical Gardens. The city provided some of the services in that effort by way of hauling the fill for remediation. There were other bills that were left outstanding from Nutting Environmental, Charlie Toppino & Sons, IBI Group and Waste Management. These were vendors that were involved in testing, consulting hauling and excavating. The bills totaled $55,414.92. Initially, the Gardens turned to the City of Key West for payment of those bills as the land owner. The city attorney's office researched the issue and discovered what we interpret as favorable language in the purchase and sale agreements as well as certain written warranties by the then county mayor. These representations, in our opinion, reduce the city's liability for these bills significantly. City staff has had numerous meetings with the Gardens and the County over the resolution of these outstanding bills. The result was the attached agreement for your approval. In sum, the County will pay $24,206.66, and the parties will recognize that the City of Key West has already expended approximately $24,000.00 to Waste Management. The remainder of the expenses has been paid by the Gardens. In addition, the parties agree to hold all parties harmless from fiuther claims regarding this issue. The site has been cleared environmentally. Additionally, the City Attorney required a further release in exchange from the Gardens regarding fill that was removed from the site for which the Gardens initially was going to lay claim to as well. That release is also attached. Options- 1. To sign the settlement agreement and resolve this issue short of suit or collections actions. The City has already tendered its contribution by providing services through Waste Management. There will be no further expense to the City. 2. Not to sign the settlement agreement. The case will proceed to a collections phase and if payment is not made, most likely litigation. Reccomendation• I recommend that you sign the attached settlement agreement.