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1978-07 Relating to the Acquisition and Disposal of Real Property and Interests in Real Propertyi A ' 2 7 sect 18.10.010 Generally. A. The borough may acquire real property from the State of Alaska or other governmental entities from time to time as such real property becomes available to the borough. B. Real property may be acquired by purchase or lease for a valuable consideration. C. Other real property or interest therein may be acquired in such manner as the assembly may authorize. 18.10.020 Procedure. Real property acquired under section 10 of this chapter shall be acquired pursuant to a resolution of the assembly. Such resolution may set the terms, conditions and manner of acquisition of the real property or interest therein. 18.10.030 Review. Upon acquisition of any real property, including real property acquired by tax foreclosure, but excluding real property acquired for a specific purpose or project, the planning commission shall review the newly acquired land and make recommendations as to whether all or any portion of the land should be devoted to public use, reserved for future use to meet projected borough requirements or made available for sale, lease or other disposition in conformance to the borough comprehensive land use plan. The manager shall review the planning commission action and make recommendations to the assembly. Page 1, Ordinance No. 1 n CHAPTER 18.10 REAL PROPERTY ACQUISITION 18.10.010 Generally 18.10.020 Procedure 18.10.030 Review 18.10.040 Designation of Availability 78 -7 -0 I 18.10.040 Designation of Availability. A. The assembly shall review all recommenda- tions made pursuant to section 30 of this chapter and by resolu- tion may concur in modify or change the recommended real property use• B. The assembly may at any time on its own motion, or upon recommendation of the manager, review the status of any real property previously reviewed and change the designation of availability in conformance with the borough comprehensive land use plan. C. Any resolution relating to real property availablity may include such terms, conditions and procedures as may be required to protect the borough's interest consistent with this title. Pa ge 2, Ordinance No. 78 - - Section a 7 �! 1 CHAPTER 18.20 GENERAL PROVISIONS FOR DISPOSAL OF REAL PROPERTY OR INTEREST THEREIN 18.20.010 Generally. 18.20.020 Disposition of Real Property. 18.20.030 Conveyance to Government. 18.20.040 Applications. 18.20.050 Qualifications of Applicants and Bidders. 18.20.060 Deposit Costs. 18.20.070 Appraisal. 18.20.080 Ordinance and Voter Ratification Required. 18.20.090 Method of Disposal. 18.20.100 Development Plans. 18.20.110 Form of Documents. 18.20.120 Public Notice. 18.20.130 Location on the Premises. 18.20.140 Warranty. 18.20.150 Assignment. 18.20.160 Modification. 18.20.170 Compliance with Laws. 18.20.180 Liens and Encumbrances. 18.20.190 Waste and Injury. 18.20.200 Non - waiver. 18.20.210 Notice or Demand. 18.20.220 Cancellation and Forfeiture. 18.20.230 Rights of Mortgagee or Lienholder. 18.20.240 Entry and Re- entry. 18.20.250 Appeals. 18.20.260 Inspection. 18.20.270 Extensions. 18.20.280 Approval of Other Authorities. 18.20.290 Definitions. 18.20.010 Generally. Unless otherwise provided in this title the general provisions of this chapter shall be used. 18.20.020 Disposition of Real Property. A. Real property of the borough may be retained, leased or otherwise disposed of under the terms and conditions e stablished by this title. B. Real property of the borough acquired by tax foreclosure may be disposed of in the same manner as other real property of the borough subject to the provisions of state lava. ; 3 , Ordinance No. 78 -7 -0 1 1 i 0 C. Prior to the disposal of real prop as sembly, with the advice of the planning commission, determine the real property or interests therein to be d of or retained in borough ownership. This determination be by resolution and the resolution may include such add terms and conditions regarding the disposition. 18.20.030 Conve ante to Government. Real pr or interest therein may be sold, leased or donated to United States, the State of Alaska, or any political sub thereof for less than its appraised value. Said real p. may be disposed of whenever, in the judgment of the ass it is in the best interest of the borough and upon the prescribed by borough resolution. 1 8.20.040 A lications. All applications purchase, lease or other acquisition of interests in real property shall be filed with the clerk on fora available at the clerk's office. Only forms complett and accompanied by a non - refundable accepted for filing. $25 filing fee The filing of an application shall not ve in the applicant to the real property or to the us property applied for. Any such unauthorized use t a trespass. 18.20.050 ualification of A licants a pplicant or bidder for the tion o f an purchase, lease n interest in borough land is qualifiv or bidder is: A. A citizen of the United or over; B. Has filed a declaratior becom a citizen and is 18 years of age or Year or age P age 4, O rdinance No. 78 -7 -0 0 i 2 7 1 ,s C. Is a group, association or corporation which is authorized to conduct business under the laws of Alaska, or; D. Is acting as an agent for another and has qualified by filing with the borough manager or his designee, prior to the time set for the disposition, a proper power of attorney or a letter of authorization creating such agency. The agent shall represent only one principal, to the exclusion of himself. 18.20.060 Deposit Costs. A. Applications for sale, lease or other interest in real property filed with the clerk will be for- warded to the manager or other designated official for an estimate of costs required to handle the application, including but not limited to survey, appraisal and advertising of the area designated in the application. An applicant required to make a deposit shall be notified in writing of the cost estimate and the applicant shall make a deposit with the borough in that amount within 30 calendar days after the date of the notice. If the applicant fails to make the deposit, the application shall be cancelled. If the applicant does not accept a lease, sale contract or other interest applied for within 30 days after it is offered to the applicant, all deposit money spent or encumbered for survey, appraisal or advertising shall be forfeited, and the balance, if any, shall be returned to the apPlicant. If the real property upon which a deposit for costs has been made is conveyed to another, the person receiving the conveyance shall be required to pay actual costs of application Processing, survey, appraisal and advertising, and the original deposit shall be returned to the depositor. Where the applicant becomes the purchaser, he shall be required to pay any excess Page 5, Ordinance No. 78 -7 -0 1 r ) 71 o f costs over deposits, and where the deposit exceeds actual the shall be credited to payments under the co sts, contract. All survey, appraisal and advertising shall be per fonQed only under the authorization of the borough and any excess such wor performed without such authorization will not be accepted B. The manager may establish an application processing fee schedule for applications having similar circum- stances. 18.20.070 Appraisal. A. No real property or interest in real prop- erty may be sold, leased or otherwise disposed of unless it has been appraised within 90 days prior to the date fixed for the disposal. The appraisal shall be performed by the assessor or a qualified appraiser and reflect the fair market value of the land and borough improvements located thereon. B. Disposal to governmental entities as pro- vided in section 30 of this chapter may be exempt from the requirements of A of this section. 18.20.080 Ordinance and Voter Ratification Required. The sale, lease or other permanent disposition of real property not acquired from the state and valued at $25,000 or more shall be in accordance with the procedure set forth in this title and, in addition, shall be by an ordinance ratified by a majority of voters voting at a regular election or special election at whic the question of the ratification is submitted. The election shall be conducted as required by AS 29.48.260. 18.20.090 Method of Disposal. A. Disposal of real property or interest herein exceeding the limits established for negotiated trans- a ctions in this title shall be by public auction or sealed bid Page 6 , Ordinance No. 78 - - i are a s directed in the borough resolution authorizing the disposal. Both competitive and negotiated disposals shall require a borou resolution authorizing the disposal action to take place. B. Disposals, other than authorized negotiated transactions, shall be to the highest qualified bidder as determined by auction or sealed bid. If there are no acceptable offers, • the manager shall reject all bids and at the direction of the assembly advertise the property for disposal again in the same manner after waiting at least 60 days from the date the previous bids were rejected. A reappraisal is required if the date fixed for the disposal exceeds 90 days from the last appraisal. 18.20.100 Development Plans. A. To become a qualified bidder for disposals requiring a development plan the prospective bidder shall submit to the manager plans of the contemplated development conforming to the proposed use. B. The time for submitting development plans shall be stated in the notice of proposed sale or lease. C. Development plans not meeting minimum standards will be returned to the applicant for revision and r e - submission within 10 days after return to the applicant. APPlicants submitting development plans failing to meet minimum standards shall not be qualified to bid. Each applicant sub- mitting a development plan shall be notified in writing of the d ecision to accept or reject the individual's development plan. D. Minimum standards of a development plan 1. A layout sketch to show reasonable use of the area being offered and nature of improvements to be constructed. PaQe 7 , Ordinance No. 78 -7 -0 0 1 2. The estimated value of the capital improvements to be placed on the land and type of construction. 3. A development schedule showing the time frame in which the improvements will be constructed. 4. The proposed development shall conform to the zoning, building codes and all applicable federal, state and local laws. 5. Other requirements as may be stated in an offer for disposal. E. The manager may require proof of financial capability of the applicant to finance the proposed development. F. The development plan and schedule for development may be incorporated into the sale or lease contract for enforcement of its completion. 18.20.110 Form of Documents. All sale, lease, deeds and other documents shall be in a form approved by the borough attorney. 18.20.120 Public Notice. Notice of proposed disposals of real property or interest therein shall, at a minimum, be Published in a newspaper of general circulation within the borough once each week for two successive weeks, not less than 20 days prior to the date of disposal and shall be posted in at least three public places within the borough, one of which shall be in the community nearest to the subject real property, for at least 30 days prior to the disposal. Additional notice may be given by any means determined to be reasonable by the ma nager or assembly. The notice must contain a brief descrip- tion of the land, its size and general location, the proposed P a ge 8, Ordinance No. 78 -7 -0 7 1 use term, minimum offer, limitations, if any, and time and plac set for the auction or bid opening. 18.20.130 Location on the Premises. It shall be the res ponsibility of the purchaser, lessee or other permittee to pr operly locate himself and his improvements on the purchased, leased or permitted property. 18.20.140 Warranty. The borough does not warrant by its zoning or disposal offering that the real property is suited for the use authorized and no guaranty is given or implied that it shall be profitable to employ the real property to said use. 18.20.150 Assignment. A contract may be assigned in whole or in part if the proposed assignment is first approved by the manager. The assignee shall be subject to all of the provisions of the original contract and this title. 18.20.160 Modification. A contract modification will not be binding on either party unless reduced to writing and signed by all parties involved or their respective suc- cessors in interest. 18.20.170 Compliance With Laws. The purchaser, lessee or permittee shall comply with all laws and ordinances relating to the possession or occupancy of the real property or relating to the construction, maintenance or alterations of any improvements to the premises. 18.20.180 Liens and Encumbrances. The purchaser shall keep the property free and clear from any liens or encum- brances arising from construction, maintenance or repairs on the property or from any other cause and shall at the purchaser's sole cost and expense, promptly secure the removal of any lien so.filed. Page 9, Ordinance No. 78 -7 -0 i 1 7 n 18.20.190 Waste and Injury. No person may wilfully comm waste, trespass or other injury to or upon borough real property. In addition to civil liability for damages and penalties, a person convicted of violating this section is guilty. of a misdemeanor. 18.20.200 Non - Waiver. The failure of the borough to insist upon strict performance of any term, condition or covenant of a contract or any deed, or to exercise any right or remedy available on a breach thereof, or the acceptance of full or partial payment during the continuance of any breach, shall not constitute a waiver of such breach of any applicable term, condition or covenant of the contract or deed unless so agreed to in writing and signed by the borough. 18.20.210 Notice or Demand. Any notice or demand, which, under the terms of a contract or under any statute, must be given or made by the parties thereto, shall be in writing, and be given or made by registered or certified mail, addressed to the other party at the address of record. Either party shall designate in writing such new or other address to which the notice or demand shall thereafter be given, made or mailed. A notice given hereunder shall be deemed. delivered when deposited ' in a United States post office enclosed in a properly addressed 1 egistered or certified mail prepaid wrapper or envelope. 18.20.220 Cancellation and Forfeiture. A. A contract, if in good standing, may be cancelled in whole or in part, at any time, upon mutual written agreement by the purchaser and the manager. B. The manager may cancel the contract if the property is used for any unlawful purpose. Pa 10 , Ordinance No. 7+h - - 1 r. C. If the purchaser defaults in the perfor- mance or observance of any of the contract terms, covenants or stipulations or fails to comply with any of the provisions of this code, and the default continues for 30 calendar days after service of written notice from the borough stating the nature of the default, or for such other period of time as provided in this title, the borough may subject the purchaser to appropriate legal action including, but not limited to termination of the contract. No improvements may be removed by the purchaser or other person during any time the contract is in default. D. If the purchaser fails, for a period of two years, or for such shorter period as may be specified in the contract, to commence construction of improve- ments pursuant to an approved development plan, or fails to make substantial use of the property within one year after completion of required improvement pursuant to a development plan, or within such shorter time as may be specified in the contract, the borough may terminate the contract. 18.20.230 Rights of Mortgagee or Lienholder. In the event of cancellation or forfeiture of a contract for cause, the holder of a properly recorded mortgage, conditional assign- ment or collateral assignment may acquire the contract for the unexpired term thereof, subject to the same terms and conditions as in the original contract. 18.20.240 Entry and Reentry. If the contract is terminated as herein provided, or by summary proceedings or otherwise, or the demised lands, or any part thereof are abandoned by the purchaser during the term, the borough may Page 11, Ordinance No. 78 - - 1 1 2 7 imme diately or any time thereafter, reenter and resume pos- ges sion o f all or any portion of the land and remove all persons and property therefrom either by summary proceedings or by a suitable action or proceeding at law, without being liable for an y resulting damages. A reentry by the borough shall not be deeme an acceptance of a surrender of the contract. 18.20.250 Appeals. A. An aggrieved bidder may appeal a manager's decision to the assembly within a period of five days following such decisions. B. An aggrieved purchaser or permittee may appeal a manager's decision to the assembly within a period of 30 days following such decision. C. Appeals under A and B of this section shall be filed in the borough clerk's office together with a $20 filing fee. D. The assembly shall within 45 days of receipt of an appeal, review the pertinent material together with any written arguments submitted by the appellant and rule on the appeal. The assembly's ruling shall be final but without Prejudice to any other right or rights the aggrieved bidder may have. 18.20.260 Inspection. An authorized representative of the borough may enter upon and inspect real property subject to a lease, contract or other agreement with the borough, at anY reasonable time. 18.20.270 Extensions. The manager may, for good Cause shown, grant a 30 day extension for a payment due in regard to a contract. A request for an extension shall be in "ing and shall be received 5 days prior to the due date. Additional extensions shall require borough assembly approval. Page 12, Ordinance No. 78 -7 -0 n 1 1 1 i 2 7 S 18.20.2 Approval of Other Authorities. The issuance by the borough of a contract under the provisions of this title does not relieve the purchaser of the responsibility for obtaining licenses or permits as may be required by the borough or by duly authorized state or federal agencies. 18.20.290 Definitions. In this title, unless the context otherwise requires, 1. "assembly" means the Kodiak Island Borough Assembly; 2. "clerk" means the Kodiak Island Borough clerk; 3. "contract" means a written document con- taining terms for the sale, lease or other use of borough real property or interests therein; 4. "manager" means the Kodiak Island Borough manager or his designee; 5. "purchaser" means one who acquires an interest in borough real property by a sale or lease contract; 6. "real property" means borough lands and the improvements located thereon. Page 13, Ordinance No. 78 -7 -0 1 ? 7 .. P age 14, Ordinance No. 78 -7 -0 CHAPTER 18.30 SALE OF REAL PROPERTY Sect' 18.30.010 Negotiated Sale of Real Property Valued at One Thousand Dollars or Less. 18.30.020 Property Acquired by Tax Foreclosure. 18.30.030 Method of Sale. 18.30.040 Terms and Conditions of Sales. 18.30.050 Payment. 16.30.060 Commencement and Completion of Construction. 18.30.070 Quitclaim Deed. 18.30.080 Limitation on Warranty of Title. 18.30.090 Taxes Fees and Charges. 18.30.100 Clearing. 18.30.110 Conveyance by Conditional Warranty Deed. 18.30.120 Certificate of Completion. 18.30.130 Breach of Warranty Deed. 18.30.010 Negotiated Sale of Real Property Valued at one Thousand Dollars or Less. The sale or other permanent dis- position of real property acquired from the state and valued at $1,000 or less, may be negotiated pursuant to terms established by resolution of the assembly. 18.30.020 Property Acquired by Tax Foreclosure. Real property of the borough acquired by tax foreclosures may be disposed of in the same manner as other real property of the borough subject to the provisions of state law. 18.30.030 Method of Sale. Sales under this title shall be by contract. Upon payment of the contract price, accrued interest and compliance with all other contract provis- ions, a warranty deed shall be issued. Upon receipt of the full purchase price and accrued interest, but prior to comple- tion of all other contract provisions, a conditional warranty deed shall be issued subject to designated conditions. 18.30.040 Terms and Conditions of Sales. In addition t o any other applicable provisions of this code, the terms, c onditions and covenants set forth in this chapter shall be 10 licable to all sales and are hereby incorporated as though 3rP fort in full in the sales contract or deed of conveyance. ,et _ sales contract or deed of conveyance shall contain such additional restriction and reservations as the assembly deems ecessary to protect the borough interests. 18.30.050 Payment. A. At the time of sale or auction, the purch- aser shall pay to the borough not less than ten percent of the 1inimum appraised value established for the parcel. The dif- °erence between the ten percent minimum appraised value and ten percent of the total price bid for the parcel shall be paid to ;he borough at the time the pruchase contract is executed. Failure of the purchaser to execute the purchase contract shall result in his forfeiture of the ten percent minimum appraised value paid at the time of sale offering. B. The remaining balance of the purchase price shall be paid over a period not to exceed 10 years from the date of execution of the sales contract, except purchasers of r contracts exceeding $15,000 in value may elect to pay the re- 1 maiming balance of the purchase price over a period not to exceed 20 years. Installment payments plus interest will be set on the level payment basis over the payment period. Pay- ments shall be made annually for contracts valued at $5,000 and less. Payments for contracts valued greater than $5,000 shall be made quarterly. C. The interest rate charged on installment Payments shall be the prevailing rate used in the conventional mortgage market in Kodiak at the time the contract is signed b ut in no case shall it be below 5% per year. 18.30.060 Commencement and Completion of Construction. A. Construction of the improvements required b y a development plan shall be commenced within two years after ex ecution of the contract and shall be completed within five Ye ars from the date of execution of the contract. { 7 7 ' B. The time for commencement and completion of improvements may be extended by the borough for good cause upon timely application by the buyer. The time of extension shall no t exceed one year. Timely application, for the purposes of this section, means an application for an extension of time received by the borough on or before the date previously set for commencement of construction or completion of construction, whichever deadline is applicable. The borough shall not grant an extension of time if the buyer is then in breach of any term, condition or covenant of the contract or deed. 18.30.070 Quitclaim Deed. Upon execution of the sale contract, the buyer shall execute and deliver to the borough a quitclaim deed in proper form, relinquishing all right, title and interest in and to the property sufficient for clearing title to the property in the event of default by the buyer. 18.30.080 Limitation on warranty of Title. A. The title to be conveyed by the borough is expressly subject to any claims asserted and established by any village, regional or special corporation, under any provision of the Alaska Native Land Claims Act; and all reservations, restrictions and easements of record. B. If it is determined, subsequent to the execution of the sale contract or deed, that the borough had no right, title or interest in the premises at the time of execu- tion of the agreement because of claims asserted and estab- lished by any village, regional or special corporation, under anY provision of the Alaska Native Land Claims Act, and that the conveyance to the Buyer did not establish a valid third - p interest excepting the property from selection, the sale c ontract shall terminate and be of no further force and effect. Pa ge 16, Ordinance No. 78 - - 1 ?_ 7 S A11 payments of principal and interest received by the borough from the buyer under the agreement shall be returned to the buyer and the buyer agrees to indemnify, hold and save the boroug harmless, to the extent of such reimbursement, from any claims or liability for damages based upon trespass or similar actions brought by any village, regional or special corporation. 18.30.090 Taxes, Fees and Charges. Buyer shall pay all taxes, ' fees, assessments and other charges levied by any public or private authority against the premises and shall timely file all notices or declarations relating to taxes, fees, charges or assessments with the appropriate authority. The borough shall promptly forward to buyer any and all notices of taxes, fees, .charges or assessments relating to the property received by the borough. 18.30.100 Clearing. Prior to full payment of the purchase contract and completion of all required improvements, buyer may clear and utilize for site development only so much of the timber or other materials from the premises as may be reasonably necessary to develop the site in conformance with the stated purpose. Timber and materials removed from the site shall be appraised for value and an amount equal to such value sremovhall al. e paid by the buyer to the borough within 30 days after The payment shall be applied toward the remaining balance of the purchase contract. 18.30.110 Conveyance by Conditional Warranty Deed. A. If the buyer desires to obtain conditional title to the property pending construction of all improvements the baleubal by the contract, the borough shall, upon receipt of the of principal and interest due to the borough, and pr °viding buyer is not then in default, convey title to buyer by a c onditional warranty deed. Page 17, Ordinance No. 78-7 -0 shall be B. The conveyance by conditional warranty deed subject to the following conditions: 1. Grantee may pledge or encumber the property for temporary or permanent financing of improvements required to be constructed by the contract of sale and for additional funds, if any, in an amount not to exceed the principal payments made to the borough for the property conveyed. The pledge or encumbrance shall be subject to the covenant running with the land requir- ing the construction of improvements specified in the contract for sale in accordance with approved plans. 2. Grantee shall pay real property taxes and assessments on the property when due and shall not create, cause or suffer any lien or encumbrance to attach to the property, other than authorized in subsection 1 above, until the borough certifies that all improvements required to.be constructed have been completed by the Grantee. 3. The Grantee shall promptly commence or continue construction of the improve- ments required by the contract of sale in accordance with the approved' plans and shall diligently prosecute con- struction of those improvements to completion. (Page 18, Ordinance No. 78 -7 -0 1 Tr 7 4. Until the borough certifies that all required improvements have been com- pleted, the grantee shall have no power to convey or transfer the prop- erty or any part thereof without the prior written consent of the borough except to a mortgagee or trustee as security to obtain financing as permit- ted by subsection 1 of this section. The conveyance or transfer prohibited shall include transfer by any party of ten percent or more of the stock in a grantee or any similar significant change in ownership of such stock or the relative distribution thereof by any means including, but not limited to, increased capitalization, merger, issuance of additional or new stock or classification of stock. C. The covenants set forth in subsection B of this section shall run in favor of and enure to the benefit of the borough for the entire period during which such covenants are in force and shall be binding upon the owner of any land or interest in land to which the covenants relate. In the event of a breach of any such covenant, the borough may exercise all rights and remedies available and may maintain any action in law or equity to enforce the curing of such breach. 18.30.120 Certificate of Completion. A. Upon completion of all required improve- ments in accordance with the provisions of the'approved develop- .,. ment plans, the borough will furnish the grantee under a con- Page 19, Ordinance No. 78 -7 -0 ditional warranty deed with a certificate of completion. The certificate shall be a conclusive determination of satisfaction of the conditions and covenants of the contract for sale and conditional warranty deed. The certificate of completion shall be in a form suitable for recording in the office of the district recorder. B. If the borough fails or refuses to provide a certificate of completion, the borough shall, within 30 days after written request by the grantee provide the grantee with a written statement indicating in what respects the grantee has failed to duly complete said improvements and what measures or acts will be necessary, in the opinion of the borough, for the grantee to take or perform in order to obtain such certification. 18.30.130 Breach of Warranty Deed. A. At any time prior to certification by the borough that improvements have been completed as required, the borough may terminate the estate granted by the conditional warranty deed if: Page 20, Ordinance No. 78 - 1. The grantee, in violation of section 110 B 2, of this chapter, fails to pay property taxes or assessments when due or places an unauthorized lien or encumbrance on the property and such taxes or assessments are not paid or the lien or encumbrances removed or discharged, or provisions satisfactory to the borough for such payment, removal or discharge are not made, within 90 days after written notice from the borough. fee 7 5 2. There is, in violation of section 110 B 4 of this chapter, a transfer of the property or any part thereof or a change in the ownership or distribu- tion of the stock of the grantee, and such violation is not cured within 60 days after written notice from the borough; or 3. The grantee defaults in timely com- mencement or completion of required improvements in compliance with approved plans, or abandons or suspends construction work for any substantial time, in violation of section 110 B 3, of this chapter, and such default relating to timely com- mencement or prosecution of the work is not cured within 60 days after written notice by the borough, or, as relates to timely completion in accord- ance with plans, is not cured within six months after written notice or within any extended period of time that may be granted by the borough for good cause shown. B. Upon termination of the grantee's estate, title to the property shall be revested in the borough and the borough may re -enter and take possession of the property, subject only to those rights and interests as hereinafter set forth in this section. It is the intent of this ordinance that the conveyance of the property by conditional warranty deed ,Page 21, Ordinance No. 78-7-0 2 7 5 shall contain a condition subsequent providing that upon default by grantee in performance of any covenant or condition required by section 110 B of this chapter and the failure of the grantee to remedy such default within times and in the manner as provided, t he borough may at its option declare a termination in favor of t he borough of all rights and interests in the property conveyed by the deed, subject, however, to specified limited interests. C. Following termination of the grantee's interest, the property shall continue to be subject to and limited by the lien or encumbrance of any mortgage or deed of trust authorized by this chapter and any rights or interests created by this chapter for the protection of holders of such mortgage or deed of trust. D. If title to the property or part thereof shall revest in the borough in accordance with the provisions of this chapter, the borough shall use its best efforts to resell the property or part thereof, in a reasonably prompt mariner and subject to any authorized encumbrance to a party or parties, determined by the borough to be qualified and respon- sible who will assume the obligation of making or completing the improvements or such other improvements in their stead as shall be satisfactory to the borough. Upon such resale of the Property the proceeds thereof shall be applied as follows: 1. To reimburse the borough, for all net costs and expenses incurred as a result of grantee's breach including, but not limited to, salaries of per- sonnel in connection with the repos- session, management and resale of the property or part thereof; all taxes, assessments, and water and sewer Pa ge 22, Ordinance No. 78 - 7 Pa ge 23, Ordinance No. 7 -7 -0 charges with respect to the property or part thereof; any payments made or necessary to be made to discharge any encumbrances or liens existing on the property or part thereof at the time of revesting of title thereto in the borough or to discharge or prevent from attaching or being made, any subsequent encumbrances or liens due to obligations, defaults or acts of the grantee, its successors, or trans- ferees; any expenditures made or obligations incurred with respect to the making or completion of the im- provements or any part thereof on the property or part thereof, and any amounts otherwise owing the borough by the Grantee and its successors or transferees; and then 2. To reimburse the Grantee, its succes- sors or transferees up to an amount equal to the sum of the purchase price paid by it for the property, or allo- cable to the part thereof, and the cash actually invested by it in making any of the improvements on the property, less any gains or income withdrawn or made by it from this conveyance or from the property. Any balance remain- ing after such reimbursements shall be retained by the borough. Sect' CHAPTER 18.40 LEASING OF REAL PROPERTY OR INTEREST THEREIN 18.40.010 Leasing Procedures. 18.40.020 Negotiated Leases. 18.4 .030 Term of Lease. 18.40.040 Terms and Conditions of Leases. 18.40.050 Minimum Acceptable Annual Rental. 18.40.060 Deposit and Receipt. 18.40.070 Payment of Annual Rentals. 18.40.080 Adjustment of Rent. 18.40.090 Use of Material. 18.40.100 Lease Utilization. 18.40.110 Subleasing. 18.40.120 Forfeiture of Rental. 18.40.130 Expiration of Lease. 18.40.140 Removal or Reversion of Improvements Upon Termination of Lease. 18.40.150 Right -of -Way. 18.40.010 Leasing Procedures. The land leasing procedures established by this title shall be utilized in the leasing of any borough land. 18.40.020 Negotiated Leases. If the annual rental value of the property acquired from the State is $500 or less and no competitive interest is apparent, the assembly may approve by resolution the issuance of a negotiated lease for a period not to exceed five years. 18.40.030 Term of Lease. Leases may be issued for a period not to exceed 55 years. The term of any given lease shall depend upon the desirability of the proposed use, the am ount of investment in improvements proposed and made, and the nature of the proposed improvement with respect to durability and time required to amortize the proposed amendment. 18.40.040 Terms and Conditions of Leases. The pro visions of this chapter and all other applicable provisions °f this code are binding as terms and conditions of any lease o f b orough land. These terms and conditions, if not fully set Page 24 , Ordinance No. 78 - - 7 7 5 / Form in the lease, are hereby incorporated by reference as ,.sough fully set out in full in the lease. The lease shall conta such additional terms, conditions and restrictions as . borough determines to be in its best interest. 18.40.050 Minimum Acceptable Annual Rental. A. Annual minimum rentals shall be computed at the prevailing interest rate used in the conventional mortgage narket in Kodiak based on the appraised fair market value for the land and improvement rights being leased. This minimum shall be the lowest acceptable bid in the event of an auction, lease by sealed bid or negotiated leased. B. No land shall be leased for less than the approved, appraised, annual rental except as provided in section 18.20.030. 18.40.060 Deposit and Receipt. The apparent high bidder shall deposit with the borough at the time of lease offering the first year's rental or that portion of it as provided in section .070 of this chapter together with the costs of survey, appraisal and advertising as provided in 18.20.060. Upon deposit of the required sum, the manager shall thereupon issue to the apparent high bidder a receipt for the required sum containing a description of land or interest leased and the rental bid. The bidder shall acknowledge the receipt in writing. Failure of the lease purchaser to execute the lease contract shall result in the forfeiture of the purchaser's rental deposit. 18.40.070 Payment of Annual Rentals. A. Annual rentals of $250 or less shall be paid annually in advance. B. Annual rentals exceeding $250 shall be advance and may be paid in installments as follows: 1. Annual rentals exceeding $250 but less than $500 may be paid in two equal installments at six months intervals. Paid in Page 25, Ordinance No. 78 -7 -0 11 ti r 7 ,) " 2. Annual rentals of $500 or more but less than $1,000 may be paid quarterly. 3. Annual rentals of $1,000 or more may be paid monthly. C. The effective date of the lease contract shall determine the anniversary date for determining payment dates. 18.40.080 Adjustment of Rental. The annual rent due shall be reviewed and adjusted by the manager at the end of the first five year term and at the end of every five year term thereafter. Any changes or adjustments shall be based upon changes in the appraised fair market value of the land and improvements being leased, excluding land fill and other improve- ments placed upon the land by the lessee; provided, however, that the value of land fill and improvements placed by a lessee and not removed on termination or expiration of the lease shall be utilized in the calculation of rentals for subsequent leases of the property with those improvements. 18.40.090 Use of Material. The lessee shall not sell or remove for use off the premises any timber, stone, gravel, peat moss, topsoil or any other material valuable for building or other commercial purposes; provided, however, that material may be used, if required, for the development of the leasehold. Any removal of such material from the leasehold shall require written approval from the manager and, if the materials will be removed in a commercial quantity, the market ! value of the materials shall be paid to the borough. 18.40.100 Lease Utilization. Leased borough real property shall be utilized for purposes within the scope of the 'application, the terms of the lease, and in conformity with the 'borough comprehensive plan. Utilization or development for ' 26, Ordinance No. 7H_7_n 7 5 S offer than the allowed uses shall constitute a violation of the lease and subject the lease to cancellation. Failure to com- mence construction of the proposed improvements within two years or failure to complete constructon of the proposed improve- ments within five years of the date of lease shall be a breach of lease and shall, at the borough's option, result in termina- tion of the lease unless the borough has granted an extension under the terms and conditions set forth in section 18.20.130. 18.40.110 Subleasing. Lands or interest therein leased from the borough maybe subleased upon receiving prior written approval of the manager. This approval shall not be unreasonably withheld. Utilization of constructed improvements shall be a substantial reason for the sublease. Subleases shall be in writing and be subject to all terms and conditions of the parent lease and this title. 18.40.120 Forfeiture of Rental. If the lease is terminated because of any breach by the lessee, as herein provided, the rental payment last made by the lessee shall be forfeited and retained by the lessor as partial or total damages for the breach. 18.40.130 Expiration of Lease. Upon termination of the lease, the lessee shall peaceably and quietly leave, sur- render and yield up unto the borough all of the said leased real property. 18.40.140 Removal or Reversion of Improvements Upon Te e nation of Lease. A. If the expiring leasehold is not to be re offered for lease the following schedule shall apply: 1. Improvements owned by the lessee on borough land shall be removed by the Pa ge 27, Ordinance No. 78 -7 -0 •1 7 5 ' ge 28, Ordinance No. 78 -7 -0 lessee, within 90 calendar days after the termination of the lease, provided, such removal will not cause injury or damage to the lands or improvements demised and further provided that the manager may extend the time for removing such improvements in cases where hardship is proven. All periods of time granted the lessee to remove improvements are subject to the lessee's' paying to the borough pro rata lease rentals for the period. 2. If any improvements or chattels not owned by the borough which have an appraised value in excess of $5,000 as determined by the assessor or appraiser, are not removed within the time allowed, such improvements or chattels shall upon due notice to the lessee, be sold at public sale under the direction of the manager. The proceeds of the sale shall inure to the lessee if he placed such improvements or chattels on the lands, after deducting for the borough rents due and owing and expenses incurred in making such sale. If no responsible bids are received, title to such improvements or chattels shall vest in the borough. 3. If any improvements or chattels having as appraised value of $5,000 or less, n I ri 2 as determined by the assessor or appraiser, are not removed within the time allowed, such improvements and chattels shall revert to, and absolute title shall vest in the borough. Notwithstanding the foregoing, if the improvements detract from, rather than enhance the value of, the property, the borough may after 60 days written notice to the lessee, remove those improvements at lessee's cost. Lessee shall reimburse the borough for the expenses of such removal within 30 days after billing. B. If the expiring leasehold is to be reoffered for lease or sale within one year of the lease termination, and the improvements have been allowed to remain in place the borough shall state when reoffering the real property: 1. the estimated value of the authorized improvements remaining on the land placed there by the former lessee; 2. that the purchaser or lessee will be required, as a condition of the sale or lease, to purchase the improvements from the former lessee for an amount equal to the value specified. C. The borough may, at the termination of a lease, compensate the lessee for the improvement located on the leasehold at not more than the fair market value. Page 29, Ordinance No. 78 - 18.40.150 Right -of -Way. A. The borough expressly reserves the right to reasonable ingress or egress over and across the leased premises for the purposes of constructing, repairing, maintaining or r eplacing any utility or road right -of -way, which the borough is authorized to construct or maintain and to grant to itself r easonable easements over and through the leased premises for these purposes. Annual rentals may be adjusted to compensate t he lessee for loss of use of the leased premises B. The borough reserves the right to grant easements or rights -of -way over and across leased land if it is determinated in the best interest of the borough to do so. If the borough grants an easement or right -of -way across any of the leased land, the lessee shall be entitled to damages for all lessee -owned improvements or crops destroyed or damaged. Damages shall be limited to improvements and crops only, and loss shall be determined by fair market value. Annual rentals may be adjusted to compensate the lessee for loss of use of the leased premises. P age 30, Ordinance No. 78 -7 -Q se c tion s : 2 7 7 n 1. Roads. 2. Trails. 3. Ditches. 4. Communication and electrical lines. 5. Landfill and disposal sites. 6. Pipelines of all types (sewer, water, petroleum, etc.) 7. Temporary use (not exceeding 45 days). 8. Exploration work involving vehicle use of any type on the borough land. B. Uses listed in A 5, 7 and 8 of this section not increasing the value or utility of borough land shall be charged a fixed fee of $250 per site or application area. C. Uses listed in A 1 through 4 and 6 of this section not directly increasing the value or utility of borough land shall be charged a fixed fee of $250 per year or the fair rental value of the land taken which ever is greater. D. Uses listed in A of this section directly increasing the value or utility of borough land may be negotia- ted at a reduced rate. 18.50.010 Generally. A. A negotiated permit, easement or right -of -way is required for the following use and occupancy of borough real property: CHAPTER 18.50 PERMITS 18.50.010 Generally. Page 31, Ordinance No. 73 - - 2 7 7 section 18.60 (Reserved) P ages 32 through 34, Ordinance No. 78 -7 -0 Sec n 7 7 P age 35, Ordinance No. 78-7 -0 CHAPTER 18.70 SALE OF TIMBER 18.70.010 Availibility. 18.70.020 Negotiated Sales. 18.70.030 Volume Determination. 18.70.040 Method of Payment. 18.70.050 Appraisal and Reappraisal. 18.70.060 Performance Bond. 18.70.070 Management Agreements. 18.70.080 Definitions. 18.70.010 Availibility. Timber on borough lands may be offered for sale when the timber is: 1. Located in an area to be cleared for a right -of -way or development site. 2. Salvage from windthrow, insect infestation, fire or other causal agent. 3. Made available as part of or all of an allowable cut as approved by the assembly. 18.70.020 Negotiated Sales. The manager may negotiate sales of timber on property acquired from the State on terms approved by the assembly. Not more than 250 thousand board feet or equivalent other measure of timber may be negotiated to one applicant in a 12 month period. Timber sales not exceeding $250 shall be paid in full at the time the contract is executed. No refund will be made if the contracted volume is not removed. 18.70.030 Volume Determination. Measurements to determine the volume of timber sold may be by cubic volume or Scribner decimal "C" log rule. 18.70.040 Method of Payment. A. Except as provided in section 20 of this Chapter, the apparent high bidder shall deposit not less than: 1. Ten percent of the purchase price for contracts valued $10,000 or less, or 0 r ? 7 7 2. The equivalent value of three months harvest, as prorated over a logging season, for contracts exceeding $10,000. B. Additional payments for the timber cut and removed from the sale area shall be stipulated in the timber sa je contract. C. A minimum balance equivalent to two months harvest, prorated over a logging season, shall be retained on deposit by the borough for the life of the timber sale contract. This balance may be applied to the final stumpage payments due but may not be applied to payments accruing earlier for timber harvested. 18.70.050 Appraisal and Reappraisal. A. All timber to be sold shall be appraised and in no case shall it be sold at less than the appraised value. B. Timber sale contracts extending more than two years shall provide for an adjustment in the unit price at the end of the second year and each two year period thereafter. 18.70.060 Performance Bond. The manager may require the purchaser to provide a performance bond in an amount he determines necessary to protect the borough's interest and ensure satisfactory compliance of the contract stipulations. 18.70.070 Management Agreements. The borough may contract for forest management services to manage its forest resources. 18.70.080 Definitions. In this chapter: "allowable cut" means that volume of timber that may be harvested within the principals of sustained yield management. Page 36, Ordinance No. 7b -7 -Q Page 37, Ordinance No. 78 - - section: ? 7 7 CHAPTER 18.80 EXCHANGE OF REAL PROPERTY 18.80.010 Real. Property Subject to Exchange. 18.80.020 Procedure. 18.80.030 Agreements to Exchange Real Properties. 18.80.010 Real Property Subject to Exchange. A. Real property acquired by the borough from the state,' may be exchanged for real property of equivalent value owned by a person. B. A request to exchange real property or interest therein shall not be authorized if it is not in the borough's best interests. 18.80.020 Procedure. A. Real property considered for exchange shall be reviewed by the planning and zoning commission. The planning and zoning commission shall make their recommendations regarding the exchange to the assembly by resolution. B. The resolution shall set out: 1. The value, or method for determining value, of the real properties to be conveyed by the borough and the real properties to be received in exchange by the borough. 2. Evidence of marketable title of the real properties to be exchanged. 3. Recommended terms and conditions of the exchange including the responsi- bility for costs of surveys, appraisals, title search and agreement preparation. 4. Alternatives considered. fl '? 1 2 7 7 in A and B of this real property to be purposes and direct by terms established to enter planning chapter. ATTEST: N C. After receipt of the recommendations provided section, the exchanged is the exchange by resolution, notwithstanding other provision of this title. 18.30.030 Agreements to Exchange Real Properties. conceptual approval may be given to the manager by the assembly, into exchange negotiations prior to receiving the and zoning resolution required in section 20 of this Any agreement reached in the negotiations shall be in writing and then presented to the planning and zoning commission as required in section 20 of this chapter for appropriate action. (7 7E.AL- Boro C erk Pa ge 38, Ordinance No. 78 -7 -0 KODIAK ISLAND BOROUGH By: assembly may find the borough no longer required for municipal be consummated in a manner and Presid .6 -• fficer First reading and approval date: April 6. 1978 Second reading, public hearing: May 4 and June 1, 1978 Effective date: June 1, 1978