AR-Beckett Ranch Option Agreement for Colton Jets Project

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Bob Ferguson, a consultant hired by the City as Project Manager for the potential power plant, has indicated that the necessary environmental studies could be conducted on the property within 60 days provided that an environmental consultant could begin work immediately. So long as the City Council is agreeable to expending the funds necessary to engage an environmental consultant, this time frame should not pose a problem. Because environmental consulting services are considered a professional service, formal competitive bidding would not be required. Bob Ferguson also indicated, in his professional opinion and based upon his visits to the property, that the risk of environmental hazards is slight. ALTERNATIVES: Approve the Option Agreement between the City and the Becketts with the Becketts' proposed revision to make the Option Payments refundable for up to 60 days in the event hazardous materials are found on the property during that 60 days. 2. Approve the Option Agreement between the City and the Becketts with the revisions proposed by the City Council on July 17, 2001 to make the Option Payments refundable if hazardous materials are found on the property at any time during the option period. 3. Take no action. FINANCIAL IMPACT: The Option Payments are $24,733.00 per month during the six-month option period. If the option is exercised, the Option Payments will be used to reduce the purchase price of $4,946,760.00. A budget adjustment will be made for $148,398 (six option payments) to Power Resource Development account #520-8000-8022-2382-0000-000 from Non-firm Purchased Power account #520- 8000-8001-2330-0555-600. ENVIRONMENTAL IMPACT: None. RECOMMENDATION: City Staff recommends that the City Council approved the attached Option Agreement which makes the Option Payments refundable for up to 60 days if hazardous materials are found on the property. Report Prepared By: Jamie L. Raymond, Deputy City Attorney