FY2018-13 Contract No. FY2018-13 Between Jere's Tree Service And Kodiak Island Borough For The Gathering Of Timber In The Chiniak Burn Area.KODIAK ISLAND BOROUGH
CONTRACT NO. FY2018-13
Chiniak Slash Gathering
SLASH AND REJECT TIMBER SALE CONTRACT
NEGOTIATED SALE WITH JERE'S TREE SERVICE
The Kodiak Island Borough ("SELLER" and "KIB"), under authority of K113 Code 18.70 and other applicable
provisions of borough and state law, does hereby agree to sell, and Jere's Tree Service ("PURCHASER"
and "JTS") does hereby agree to purchase timber as designated herein, subject to the following terms and
conditions. This contract is effective as of November 9 2017
TABLE OF CONTENTS
1.
SUMMARY OF AGREEMENT.............................................................................................................................1
2.
DEFINITIONS....................................................................................................................................................2
3.
RESERVATIONS.................................................................................................................................................2
4.
RIGHTS OF ENTRY AND USE.............................................................................................................................3
S.
TERM OF CONTRACT........................................................................................................................................3
6.
TERMINATION..................................................................................................................................................3
7.
PAYMENTS.......................................................................................................................................................3
8.
COMPLIANCE WITH LAWS AND OTHER REQUIREMENTS................................................................................3
9.
OPERATIONS....................................................................................................................................................3
10.
RISK MANAGEMENT.....................................................................................................................................4
11.
ENVIRONMENTAL COMPLIANCE, PROTECTION AND SAFETY......................................................................5
12.
INTERIM AND FINAL ACCOUNTING.............................................................................................................6
13.
ASSIGNMENT OF CONTRACT.......................................................................................................................6
14.
VALID EXISTING RIGHTS: ..............................................................................................................................
6
15.
GENERAL PROVISIONS.................................................................................................................................6
ATTACHMENTA PROPOSED ACCESS CONTROL..................................................................................................8
1. SUMMARY OF AGREEMENT
• The Kodiak Island Borough owns land in Chiniak, known as the
Chiniak Burn Area. A-1 Timber completed logging operations on
the parcel in 2017. Substantial amounts of logging slash, well -scatter,
and rejected timber were left on the parcel.
• Jere's Tree Service has a contract to furnish to 2500 cubic yards of
chipped wood product annually to the City of Kodiak sludge composting
facility. JTS also operates a small firewood -for -delivery service. This
contract permits JTS to harvest slash, well -scatter, and reject timber for
resale within the business operations of Jere's Tree Service.
• This agreement is for three years. Fees are subject to re -negotiation as
outlined in KIBC 18.70.050
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• Quantity: Up to 2500 CY of chipped material annually for the City of
Kodiak Compost, other quantities as needed.
Price: $3/CY for wood chips. $15/Cord of firewood. These rates include
severance tax. No further severance tax shall be applied.
In consideration of the mutual covenants and agreements herein
contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the KIB and Jere's Tree
Service agree as follows:
2. DEFINITIONS
Definitions shall include all terms defined by I1 AAC 71.910 Definitions and the following. If there is a
conflict of definition, the regulations shall govern.
A. "Construction Materials" includes rock, sand, gravel, logs used for road sub grade or bridge
construction, and other construction materials located in the Chiniak Burn Area.
B. "Environmental Contamination" means pollution resulting from the "release" [as that term is
defined in AS 46.03.826(9)] of a "Hazardous Material."
C. "Hazardous Material" means hazardous substances or materials as defined in Alaska Statutes
46.03.826 and 46.08.900, in 42 U.S.C. § 9601-9657 (CERCLA), in 42 U.S.C. § 9601 (RCRA) and in 40
C.F.R. U.S.C. § 302, as such statutes and regulations may be amended from time to time, and any hazardous
and toxic substance, material or waste which is or becomes regulated by any governmental authority.
Without limiting the forgoing, "Hazardous Material" includes hydrocarbon fuels such as diesel oil and
gasoline, and lubricating oil.
D. "Laws" mean all applicable federal, state or local statutes, regulations, rules, ordinances or
permits, orders, directives, and amendments thereto, in effect during the Term of this Contract and as they
legally change over time.
E. "PURCHASER" means the purchaser of timber, purchaser's agent, employees,
representatives, contractors, subcontractors or other individuals or entities operating on behalf of
PURCHASER.
F. "Roads" includes all roads, bridges, landings, culverts, and any other transportation facility
PURCHASER is authorized to use or to construct pursuant to this Timber Sale Contract.
G. "Slash" means all woody debris resulting from 2016-2017 Timber Operations.
H. "Timber" means all slash, reject timber, and well -scatter within the Chiniak Bum Area.
I. "KIB Land" means land owned by the Kodiak Island Borough, and interests and resources in the
land, including improvements to the land.
J. "Chiniak Bum Area" shall include all lands within the 732 acre parcel T30S RI SW Section 5
and portion of 6 of the Chiniak Subdivision, known by KIB Property ID Number 18896.
3. RESERVATIONS
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The KIB reserves the right to permit other compatible uses of the lands in the contract area which do not
unduly impair JTS operations under this contract, as determined by the KIB. The KIB hereby reserves the
right to use any road constructed by JTS under this contract for any and all purposes in connection with the
protection and administration of KIB lands.
4. RIGHTS OF ENTRY AND USE
During the term of this contract and to the extent it is legally authorized to do so, the KIB hereby grants to
JTS the non-exclusive right to enter upon and use the Chiniak Bur Area and associated access routes
across KIB land.
The granted rights include the right to construct roads to and within the Chiniak Bur Area and to use
Construction Materials within the bum area for necessary maintenance of existing roads within the tract.
JTS may install and maintain one access -controlling gate for the purposes of reserving materials and
preventing public entry into an active work zone. The gate shall be located at either of the locations outlined in
Attachment A.
5. TERM OF CONTRACT
The term of this contract shall commence upon the effective date and terminate December 31, 2020, or the
date that all obligations under this contract have been completed, whichever is earlier.
6. TERMINATION
This contract may be terminated by either party. Either party must give the other a minimum of 30 days' notice
to terminate this contract. This contract will not be terminated by KIB without just cause. This contract may be
terminated immediately with mutual agreement between KM and JTS.
7. PAYMENTS
rates.
A. Purchase Price: $3/CY Chipped Material, $15/Cord of wood. Severance tax is included in these
B. Estimated Amount: 2500 CY Chipped Material. Cords of wood to be determined.
C. Payment: JTS shall pay the KIB on a monthly basis for all slash and timber removed for KIB
Property.
8. COMPLIANCE WITH LAWS AND OTHER REQUIREMENTS
A. Comoliance with Laws. JTS is required to conduct all operations in compliance with the
state, federal, and municipal laws.
B. Responsibility for Acquisition of Permits, Authorizations and Approvals. JTS is responsible for
the acquisition of necessary permits, licenses, fees, and other regulatory approvals at its cost.
9. OPERATIONS
A. Reforestation. JTS shall be responsible for replacing/restoring any replanted areas impacted by
work done under this contract. Replanting of the entire Chiniak Bum Area was completed in July 2017.
B. Roads. JTS shall provide culvert and road maintenance along their haul routes within the KIB
parcel for the duration of this contract. JTS shall leave areas of impact within KIB lands in a neat
and clean condition acceptable to the KIB.
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C. KIB Inspections. The KIB and its representatives shall at all times have access to observe
and inspect JTS operations.
D. Fish Spawning Waters. All operations in connection with this contract adjacent to lakes,
streams, or fish -bearing waters must be conducted so as to avoid stream silting and must not interfere with the
passage of fish or injure the spawning grounds, in accordance with AS 41.17.
E. Archeological Sites. If, during the course of operations, any physical remains of historic,
archaeological, or paleontological nature are discovered, work in that immediate vicinity must cease and the
KIB must be notified. The Alaskan Historic Preservation Act prohibits the appropriation, excavation,
removal, injury, or destruction of any historic, prehistoric or archaeological resources of the State.
F. Monuments and Markers. JTS must reasonably protect all known land survey monuments
and witness trees and markers from damage or obliteration. JTS will be responsible to hire a licensed surveyor
to replace/reestablish any monuments/markers destroyed or distressed as a result of their operations.
G. JTS Right to Restrict Access. JTS may take reasonable measures to restrict access to parts of
the Chiniak Burn Area (see Attachment A) that are necessary for safe and efficient operations. Reasonable
measures include, but are not limited to, gating roads and limiting access to harvest areas. Access restrictions
shall be coordinated with and agreed to by KIB.
10. RISK MANAGEMENT
A. Insurance Requirements. JTS will maintain liability insurance in accordance with Article V of KIB
contractor services agreements, as follows:
ARTICLE V: Insurance Requirements where JTS shall be known as the "Contractor":
The Contractor shall provide evidence of insurance with an insurance carrier or carriers
satisfactory to the Borough covering injury to persons and property suffered by the Borough
or by a third party as a result of operations under this Contract by the Contractor or
by any subcontractor. The Contractor's insurance shall provide protection against injuries to
all employees of the Contractor and the employees of any subcontractor engaged in work
under this contract. All insurance policies shall be issued by insurers that (i) are permitted to
transact the business of insurance in the Borough under AS 21 and (ii) have a financial
rating acceptable to the Borough. The Contractor shall notify the Borough, in writing, at
least 60 days before cancellation of any coverage or reduction in any limits of liability.
Additional insurance requirements specific to this contract are contained in the Special
Provisions, when applicable.
ii. The Contractor shall maintain the following policies of insurance with the specified
minimum coverages and limits in force at all times during the performance of the Contract:
a. Workers' Compensation: As required by AS 23.30.045, for all employees of the
Contractor engaged in work under this Contract. The Contractor shall be
responsible for Workers' Compensation Insurance for any subcontractor who
performs work under this Contract. The coverage shall include:
b. Waiver of subrogation against the Borough;
C. Employer's Liability Protection at $500,000 each accident/each employee and
$500,000 policy limit.
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iii. Commercial General Liability: on an occurrence policy form covering all operations with
combined single limits not less than:
a. $1,000,000 Each Occurrence;
b. $1,000,000 Personal Injury;
c. $2,000,000 General Aggregate; and
d. $2,000,000 Products -Completed Operations Aggregate.
iv. Automobile Liability: covering all vehicles used in Contract work, with combined single
limits not less than $1,000,000 each occurrence.
V. Umbrella Coverage: for Contract amounts over $ 5,000,000 not less than
$5,000,000 umbrella or excess liability. Umbrella or excess policy shall include products
liability completed operations coverage and may be subject to
$5,000,000 aggregate limits. Further, the umbrella or excess policy shall contain a clause
stating that it takes effect (drops down) in the event the primary limits are impaired or
exhausted.
vi. The Borough shall be named as an additional insured on policies required by paragraphs 2 thru
4 above. All of the above insurance coverages shall be considered to be primary and
noncontributory to any other insurance carried by the Borough, whether through self-
insurance or otherwise.
vii. Indemnification: the Contractor shall indemnify, save harmless, and defend the Borough
and its agents and its employees from any and all claims or actions for injuries or damages
sustained by any person or property arising directly or indirectly from the construction or
the Contractor's performance of this Contract; however, this provision has no effect if, but
only if, the sole proximate cause of the injury or damage is the Borough's gross negligence.
11. ENVIRONMENTAL COMPLIANCE, PROTECTION AND SAFETY
A. Hazardous Materials. JTS must not cause or permit to be brought upon, stored or used in or
about the Chiniak Bum Area, or the Roads by JTS, its agents, employees, contractors, or invitees, any
Hazardous Materials without the prior written consent of the KIB, which will not be unreasonably withheld
by the KIB so long as JTS demonstrates to the KBB's satisfaction that such Hazardous Materials are
reasonably necessary to JTS operations and will be used, kept, and stored in a manner that complies
with all Laws regulating any such Hazardous Materials.
B. Fuel Storage, Fueling, Maintenance and Snill Prevention. The KIB hereby consents that JTS
may bring upon, and use necessary fuel, lubricating oil, hydraulic fluids, and anti -freeze substances in
the Chiniak Burn Area and on the Roads during the Term of this Contract only to the extent such items are
transported, used, and disposed of in a manner that complies with all Laws and the terms of this Contract.
No fixed tank storage is allowed on the sale area. JTS must have adequate absorbent and cleanup
materials on site and in all vehicles and machinery to contain spills related to fueling, maintenance and repair
operations and damage likely to be sustained in the course of operations. Fuel storage facilities must not be
placed within 100 feet of water bodies. Refueling of equipment must not occur on the active flood plain of a
water body.
C. Sanitation. The work area must be maintained in a clean and sanitary condition during the
operations of JTS. Any foreign materials or wastes such as cans, bottles, barrels, garbage, equipment,
equipment parts, or other debris resulting from this operation must be removed from the work area prior to
release from this contract.
D. Immediate Cleanup of Environmental Contamination. In the event JTS becomes aware of
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any Environmental Contamination within the Timber Sale Area, JTS must immediately notify the KIB and
the Alaska Department of Environmental Conservation. JTS shall comply with DEC recommended clean up
methods at its sole expense when the contamination is a result of activities conducted under this contract.
12. INTERIM AND FINAL ACCOUNTING
Upon the expiration of this Contract or within thirty (30) business days of the completion of all activities
under this contract, there must be a final accounting between the parties. Within thirty (30) days after all
calculations have been made and approved by both parties and final accounting and other inspections
have been completed, all debts between the parties must be settled.
Upon completion of all JTS obligations under this contract, the KIB will issue a notification releasing JTS
from any further obligations under this contract including maintenance and restoration activities.
Severance Tax under KIBC 3.45 shall be included in the fixed rate payments as shown in Section 7.
13. ASSIGNMENT OF CONTRACT
This contract may not be assigned by JTS without written consent to such assignment first having been
obtained from the KIB and the necessary amendment made to the contract.
14. VALID EXISTING RIGHTS:
The rights granted to JTS under this Contract are subject to all valid existing rights in existence on the effective
date whether or not made of record, including without limitation, easements, rights -of- way, reservations, or
other interests in land.
15. GENERAL PROVISIONS
A. Contractors. JTS shall notify the KIB in writing of all contractors and subcontractors engaged by
JTS to perform work relating to this contract. JTS must require, by contract, all such contractors and
subcontractors to abide by the terms and conditions of this contract, and JTS must provide them
with relevant provisions of this contract.
B. Delivery of Payments. All payments must be delivered to the KIB at:
Kodiak Island Borough
Attn: Finance Department
710 Mill Bay Road
Kodiak, AK 99615
Please reference this contract number with your payment. Contract No. FY2018-13.
C. Governing Law. This Agreement shall be governed by the. laws of the State of Alaska. -
D. Effective Date. This contract must be approved by the KIB Assembly. Effective Date shall be
upon Assembly approval of this contract.
ACCEPTED FOR:
SELLER:
PURCHASER:
KODIAK ISLAND BOROUGH
Jere's Tree Service
710 Mill Bay Road
2566 Devils Prongs
Kodiak, Alaska 99615
Kodiak, AK 99615
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KODIAK ISLAND BOROUGH JERE'S TREE
By: By:
Michael Powers Jeroniah Olsen
Title: Manager Ti e: Owner
STATE OF ALASKA
Ss.
THIRD JUDICIAL DISTRICT
The Foregoing �I�/nn,sst�trument was acknowledged before me, ofn and on b#lf of the Corporation on this V
day of I Com' ktrA J�i12017, by l 4W EA I (3lAAPl'S
AND SWOP TO this 6 Aday of��2017
Notary in and for the State
My commission expires:_
STATE OF ALASKA
Ss.
THIRD JUDICIAL DISTRICT
V40TAq y
PUBLIC
The Foregoing Instrument was acknowledged before me, of and on behalf of the Corporation on this
day of � lh4tnloaC2017,by -,Pre- Mlk�A 01CPn
SUBSCRIBED AND SWORN TO thisq-�Adayof MDOemloer2017
Notary in and for the State of ALASKA
OOTARr
My commission expires: i1J 1 n4i CII..
.n:. %BUG
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ATTACHMENT A PROPOSED ACCESS CONTROL
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Figure 2. Proposed Gate Area 1
Figure 3. Proposed Gate Area 2
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