2002 AGN MAR 05 I14 - Laserfiche WebLink

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CITY OF COLTON Item #14 AGENDA REPORT For the City Council Meeting of March 5, 2002 TO: Honorable Mayor and City Council FROM: Thomas K. Clarke, Utilities Director SUBJECT: Amendment to Beckett Ranch Purchase Option DATE: February 26, 2002 On August 14, 2001, the City Council authorized the City to enter into a purchase option of the Beckett horse property on Agua Mansa Road. The purchase of the property would enable the development of the Colton Jets generation project as part of the City's need for new energy supply. DISCUSSION / ANALYSIS The purchase option contained provisions for monthly option payments to the Beckett's that would permit the City to buy the property upon completion of the Colton Jets development plan. The agreement stated that the City could retain the option for up to twelve months. However, only the first six month's payments would be applicable towards the purchase price of the property. That six month period ends with the February, 2002 payment. The Electric Utility is in the process of receiving proposals for the development of the Colton Jets facility. Those proposals are due in on March 12. Staff approached the Becketts to see if they would be amenable to extending the condition of options payments applicable to the purchase price for an additional two months (March and April). This would allow the City to evaluate the development proposals and open escrow on the property in a logical progression. The Becketts have agreed to the City's request and have executed the necessary amendment to the purchase option. ALTERNATIVES The City could adhere to the original conditions of the purchase option. This would mean that any option payments made after February would not apply towards the purchase price of the property. FISCAL IMPACT Even though the City is still required to make the option payment, the amount applies to the purchase price. This is a savings of approximately $50,000 in the acquisition of the property. Page 1 of 2