i
AMENDED & RESTATED
SOUTH LAKE LEASE AGREEMENT
By
Vallecitos Water District
as District
and
City of San Marcos, California
as City
Dated as of: November 2, 2022
ii
Table of Contents
ARTICLE I: PREMISES AND TERM ....................................................................................................... 2
1.1 Lease Area. ................................................................................................................................... 2
1.2 Restricted Areas. ........................................................................................................................... 2
1.3 Term of Lease. .............................................................................................................................. 3
1.4 Acceptance of Premises. ............................................................................................................... 3 ARTICLE II: RENT, TAXES AND UTILITIES ........................................................................................ 4
2.1 Rent. .............................................................................................................................................. 4
2.2 Taxes and Assessments. ................................................................................................................ 4
2.3 Utilities. ......................................................................................................................................... 4 ARTICLE III: USE, MAINTENANCE, AND COMPLIANCE WITH LAWS .......................................... 5
3.1 Limitations on Use. ....................................................................................................................... 5
3.2 No Liens or Easements. ................................................................................................................ 5
3.3 Maintenance of Leased Premises. ................................................................................................. 5
3.4 Cost of Maintenance. .................................................................................................................... 6
3.5 Supplemental Reservoir Supply. ................................................................................................... 7
3.6 Compliance with Laws and Restrictions. ...................................................................................... 7 ARTICLE IV: DEVELOPMENT PLAN, FINANCING, CONCESSIONS, AND FEES .......................... 8
4.1 Initial Improvements ..................................................................................................................... 8
4.2 Master Plan and Improvements..................................................................................................... 8
4.3 Financing and Bonded Indebtedness. ............................................................................................ 9
4.4 Concessions and Subleases. .......................................................................................................... 9
4.5 Fees and Charges. ....................................................................................................................... 10
4.6 Use of Revenues. ........................................................................................................................ 10 ARTICLE V: RESTRICTIONS ON USE AND DISTRICT RESERVATIONS ...................................... 11
5.1 Water Level Fluctuation.............................................................................................................. 11
5.2 Water Quality. ............................................................................................................................. 11
5.3 Restrictions on Access. ............................................................................................................... 11
5.4 District Access and Improvements. ............................................................................................ 12 ARTICLE VI: INSURANCE..................................................................................................................... 13
6.1 Insurance Coverage. .................................................................................................................... 13
6.2 Coverage Limits. ......................................................................................................................... 13
6.3 Endorsements. ............................................................................................................................. 14
6.4 Additional Insured. ..................................................................................................................... 15
6.5 General Liability Coverage. ........................................................................................................ 15
6.6 Automobile Coverage. ................................................................................................................ 15 iii
6.7 Insurance Forms. ......................................................................................................................... 15
6.8 Insurance Deductible................................................................................................................... 16
6.9 Insurance Rating. ........................................................................................................................ 16
6.10 Certificates of Insurance. ............................................................................................................ 16
6.11 Worker’s Compensation. ............................................................................................................ 17
6.12 Dam Failure. ............................................................................................................................... 17 ARTICLE VII: DAMAGE OR DESTRUCTION DURING TERM OF LEASE ..................................... 18
7.1 Restoration of Leased Premises. ................................................................................................. 18
7.2 Restoration of Dam and/or Appurtenant Facilities. .................................................................... 18 ARTICLE VIII: CONDEMNATION ........................................................................................................ 19
8.1 Condemnation. ............................................................................................................................ 19 ARTICLE IX: DEFAULT AND TERMINATION ................................................................................... 20
9.1 Events of Default. ....................................................................................................................... 20
9.2 Notice and Right to Cure. ........................................................................................................... 20
9.3 Remedies. .................................................................................................................................... 20
9.4 Termination by City. ................................................................................................................... 21 ARTICLE X: ENVIRONMENTAL PROTECTION AND HAZARDOUS WASTE .............................. 22
10.1 Environmental Protection. .......................................................................................................... 22
10.2 Hazardous Materials. .................................................................................................................. 22 ARTICLE XI: ADDITIONAL COVENANTS OF CITY ......................................................................... 24
11.1 Security of Recreation Area. ....................................................................................................... 24
11.2 Signage and Displays. ................................................................................................................. 24
11.3 Entrance Gate. ............................................................................................................................. 24
11.4 Boat and Water Contact Restrictions. ......................................................................................... 25
11.5 Annual Reporting. ....................................................................................................................... 25 ARTICLE XII SURRENDER AND DISPOSITION OF PREMISES ...................................................... 26
12.1 Surrender of Leased Premises. .................................................................................................... 26
12.2 Disposition of City's Property upon Termination. ...................................................................... 26
12.3 Assignment and Subletting. ........................................................................................................ 26 ARTICLE XIII: INDEMNIFICATION ..................................................................................................... 27
13.1 Indemnification. .......................................................................................................................... 27 ARTICLE XIV: MISCELLANEOUS PROVISIONS ............................................................................. 29
14.1 Governing Law. .......................................................................................................................... 29
14.2 No Waiver of Breach. ................................................................................................................. 29
14.3 Invalidity. .................................................................................................................................... 29
14.4 Notices. ....................................................................................................................................... 30 iv
14.5 Entire Agreement. ....................................................................................................................... 31
14.6 Waiver; Amendment. .................................................................................................................. 31
14.7 Additional Documents. ............................................................................................................... 31
14.8 Venue. ......................................................................................................................................... 31
14.9 Severability. ................................................................................................................................ 31
14.10 Counterparts. ........................................................................................................................... 32
Amended & Restated South Lake Agreement Page 1 of 32
AMENDED & RESTATED SOUTH LAKE LEASE AGREEMENT
This Amended and Restated Lease Agreement (“Agreement”) is made and dated as of , by and between the Vallecitos Water District, a County Water District organized and existing pursuant to California Water Code section 3000 et seq. (“ District”), and the City of San Marcos, a California Charter City (“ City”), with reference to the following facts:
RECITALS:
A. District provides water service to portions of north San Diego County that includes City. District is the owner of a raw water reservoir with a capacity of 75 -million gallons located in the southerly portion of the San Marcos Valley in City known as South Lake Reservoir (“ South Lake ”). South Lake was part of District's potable water distribution system but was taken out of operational use in 1984 in compliance w ith the Safe Drinking Water Act. The sole source of water for South Lake is rain and run -off.
C. The 2018 Master Plan identified South Lake for use for stormwater capture, and potential Indirect Potable Reuse (IPR) via Surface Water Augmentation.
D. City desires to expand public recreational areas within its boundaries by incorporating South Lake into its recreational development plan.
E. On August 28, 2005, District and City entered into the South Lake Lease Agreement. Under the terms of this agreement, District is willing to permit the lease and use of South Lake by City for a public recreation area, provided City's use does not infringe or interfere with District's future water supply flexibility and City assume d the responsibility and liability for operation and maintenance of the recreational area.
F. Pursuant to sections 31130 and 31048 of the County Water District Act and after consideration of informal public review and comment, District and City find that Amended & Restated South Lake Agreement Page 2 of 32
entering this amended and restatement of the Agreement will promote the best interests of the communities served by the two parties.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants, and agreements contained in this Agreement, the Parties hereto agree as follows:
ARTICLE I: PREMISES AND TERM
1.1 Lease Area.
District hereby leases to City, and City hereby leases from District, on the terms and conditions set forth in this Agreement, the water surface of South Lake and adjacent surrounding property which is more particularly identified and described on the plat and legal description. Final legal description is required prior to public opening of the facility.
South Lake and the adjacent property are hereinafter referred to as the (“ Leased Premises” or “Recreational Area”).
1.2 Restricted Areas.
City shall not allow and will prohibit public access to those areas of the South Lake property that include the upstream and downstream Dam Faces, the Slough Escape, Fenced Areas, the Pump S tation and related facilities , and any areas identified by City as Biologically Sensitive areas. City shall be responsible for conducting a biological survey and delineating any Biologically Sensitive areas. District further reserves the right to restrict public access to portions of South Lake for operations, safety, and water quality issues. All such restricted areas are delineated on Exhibit A hereto. Prior to the commencement of any recreational activities at South Lake , City shall develop and implement a Signage and Fencing Plan to prevent unauthorized access to restricted areas. District shall review and Amended & Restated South Lake Agreement Page 3 of 32
approve the plan prior to its implementation. City shall be responsible for the cost of installing any and all signs and fencing identified in the Signage and Fencing Plan or identified at a later date to protect facilities from public access.
1.3 Term of Lease.
The term of this Agreement shall be for Fifty (50) years, commencing on August 5, 2005. The Recreational Area shall be available to City, but not be opened to the public prior to the implementation of the Signage and Fencing Plan and completion of the improvements identified in Section 4.1 below . If allowed by law, this Agreement may be extended an additional 25 years by mutual agreement.
1.4 Acceptance of Premises.
City accepts the Leased Premises “as- is.” It is expressly understood that any and all users agree to use the Recreational Area at their own risk and that District and any and all of its directors, officers, employees, or agents will be held harmless from any and all liabilities arising from injury or accident to anyone using the Recreational Area. City and its invitees agree that the trail immunity as set forth in Section 831.4 of the Government Code applies to the trails and areas accessed by the trails within the Recreational Area and that District and its directors, officers, employees, and agents are entitled to such immunity to the fullest extent permitted by law. A joint pictorial inventory depicting the more significant features and known pre -existing physical conditions of the Recreational Area shall be compiled prior to the facilities being opened to the public.
[remainder of page intentionally left blank]
Amended & Restated South Lake Agreement Page 4 of 32
ARTICLE II: RENT, TAXES AND UTILITIES
2.1 Rent.
The parties agree that the use of South Lake as a Recreational Area shall benefit the respective communities served by District and City. Accordingly, during the term of the Agreement, City covenants and agrees to develop and maintain the Recreation Area, comply with the terms of this lease, and pay $1.00 per year as consideration to District.
2.2 Taxes and Assessments.
City also agrees to pay all applicable real and personal property taxes, general and special assessments, and other charges of every description levied on or assessed against the Leased Premises, improvements, or personal property located on or in the Leased Premises.
City acknowledges that the L eased Premises, or portions thereof, may be subject to possessory interest taxes, and that such taxes, if applicable, shall be paid by City or its sublessees and concessionaires. This statement is intended to comply with Section 107.6 of the Revenue and Taxation Code . City shall include a statement in all subleases and other agreements to the effect that the interests created therein may require the payment of a possessory interest tax.
2.3 Utilities.
City further agrees to pay all utilities used upon the Leased Premises, including without limitation water, gas, heat, light, power, telephone service, refuse collection and removal, and all other services supplied to the Leased Premises, excluding any such charges that arise from District facilities or activities. All utilities shall be installed underground unless the prior written consent of District is obtained. District staff will meet with City staff to determine, to the extent possible, what undergrounding of existing and future facilities are anticipated in order to optimize coordinated efforts, minimizing future impacts.
Amended & Restated South Lake Agreement Page 5 of 32
ARTICLE III: USE, MAINTENANCE, AND COMPLIANCE WITH LAWS
3.1 Limitations on Use.
The Leased Premises are leased to City for the sole purpose of City operating and maintaining the Leased Premises as a recreational area in accordance with City's Parks Master Plan. In the event City ceases to utilize South Lake for recreational purposes, at any time during the term of the lease, this Agreement shall terminate, and the Leased Premises shall be returned to District in a good, clean, and undamaged condition, ordinary wear and tear excepted.
3.2 No Liens or Easements.
Except for permitted encumbrances, easements, and restrictions approved in writing by District beforehand, City agrees and covenants not to place any deed of trust, mortgage, or any other type of security lien upon the Leased Premises during the term of this Agreement.
3.3 Maintenance of Leased Premises.
City shall, at its sole cost and expense, maintain the Leased Premises in good, clean, and undamaged condition and use as a recreational area in accordance with all applicable laws, including without limitation such zoning, safety ordinances and laws, environmental regulations, and such rules and regulations thereunder as may be binding upon City. District shall not have any responsibility to maintain the Leased Premises. City hereby waives all rights to make repairs to the Leased Premises at District's expense or to deduct the cost thereof from the rent. All rights under California Civil Code sections 1932(1), 1941, and 1942 or any law in replacement thereof are hereby waived and released. District will work with City to provide a reasonable amount of technical expertise with supporting documentation related to administrative preparation and filing for perm its and related Amended & Restated South Lake Agreement Page 6 of 32
charges from permitting agencies within the historical scope of District's water supply related requirements recognizing that there may be permits and fees outside of District's knowledge and experience.
3.4 Cost of Maintenance.
(a) Except as provided elsewhere in this Agreement, City shall be responsible for all costs associated with the maintenance and operations of the facilities supporting recreational uses, including weed abatement, erosion control, litter removal, fence and sign repair and/or replacement, trail upkeep and all necessary permitting and inspection fees in compliance with all applicable laws, including, without limitation, such zoning and safety ordinances and laws, environmental regulations and such rules and regulations that may be binding upon City or District.
District shall be responsible for the costs of all activities associated with the maintenance and operations related to the dam structure and appurtenant facilities. Further, throughout the term of this Agreement District shall maintain, at its sole cost and expense, liability insurance coverage for the possibility of failure of the dam and/or its appurtenant facilities at levels sufficient to cover damages to and/or l oss of City's improvements on the Leased Premises in such event.
During the term of this Agreement, City and District shall equally share the costs of any and all Water Treatment at South Lake, including but not limited to the cost incurred by District to install an ultrasonic device to control algae growth and the cost of its annual operation and maintenance. District may chemically treat the water in South Lake or remove vegetation along the shoreline to protect and preserve water quality characteristics and standards determined by District. The costs of those activities will be shared equally between the City and District. City shall be responsible for any and all chemical treatment and Amended & Restated South Lake Agreement Page 7 of 32
vegetation removal associated exclusively with recreational use. City shall reimburse District for any work performed at the request of City benefiting the recreational use.
3.5 S upplemental Reservoir Supply.
Water for the recreation lake will come from rain event runoff and/or City wells. If well water is unavailable and imported water is available through District for such use , District will sell water to City if water is available for such use and at the then applicable District construction water rate applicable to other rate payers.
3.6 Compliance with Laws and Restrictions.
City agrees to use the Leased Premises in material compliance with all laws now in force or which may hereafter be in force relative to its use as a recreational area, including without limitation compliance with all building requirements and regulations, appropriation of water rights/usage, as well as all covenants, conditions, and restrictions contained in this Agreement.
[remainder of page intentionally left blank]
Amended & Restated South Lake Agreement Page 8 of 32
ARTICLE IV: DEVELOPMENT PLAN, FINANCING, CONCESSIONS, AND FEES
4.1 Initial Improvements
As of the effective date of this Agreement, City shall provide an Initial Improvement Plan (IP) as shown in exhibit A. The IP shall be completed prior to opening the facility for public access and depict initial improvements proposed to activate the recreational space.
All improvements associated with the IP shall be compatible with existing features and do not affect District facilities in a detrimental manner . City also agrees to submit to District a schedule for all IP improvements prior to commencement of work. All improvements shall be subject to inspection by District and any changes or revisions not in substantial conformance with the IP shall require the prior written approval of District, which approval shall not be unreasonably withheld. City shall reimburse District for the reasonable time and expense incurred to review the construction plans and inspect the improvements. Once the IP is completed and approved by District, South Lake can be opened to the public
4.2 Master Plan and Improvements.
The Parties recognize a Master plan identifying the recreational facilities may be developed in the future. City shall submit the Master Plan and Improvements to District for review and approval prior to moving forward with any improvements. Areas identifi ed in the Agreement as restricted or prohibited from use by City and/or District shall supersede recreational facilities shown in the Master Plan. The Master Plan shall show the location of proposed roads, bicycle paths, entrance gate, hiking trails, nature study areas, boat ramps, mooring facilities, buildings, water and sanitary facilities, a water course from both the dam outlet and spillway to natural drainage courses and any other proposed recreational Amended & Restated South Lake Agreement Page 9 of 32
improvements. District shall have the right to review, comment, and approve the Master Plan, approval of which shall not be unreasonably withheld.
City also agrees to submit to District the construction plans for all improvements associated with the Master Plan. District will provide comment or approval w ithin 30-days of receipt of plans. All improvements shall be subject to inspection District and any changes to the character of the design or revisions shall require the prior written approval of District.
Approval of items enumerated in this section shall not be unreasonably withheld. City shall pay all applicable costs for the review, approval, and inspection of improvements.
4.3 Financing and Bonded Indebtedness.
City may enter into bonded indebtedness or other types of permitted public financing to pay for the cost of improvements constructed at the Recreational Area. This is provided, however, that such financing shall not interfere with, or restrict, District's future water supply flexibility and that the term of such financing shall not exceed the term of this Agreement.
4.4 Concessions and Subleases.
City may enter into concession agreements and subleases for the purpose of providing recreational facilities and services at South Lake for the general public. All such agreements and subleases shall be subject to review and approval by District, which sha ll not be unreasonably withheld, with no financial interest or claim therein, prior to issuance and shall be expressly subject to the terms and restrictions of this Agreement and shall in no event conflict with the water service flexibility or operational responsibilities of District.
All such agreements shall contain provisions necessary to protect District, its officers, employees, successors, and assigns from any liability arising out of the construction, operation, and/or maintenance of any improvements and concessions. The term of any Amended & Restated South Lake Agreement Page 10 of 32
permit, concession, sublease, or other agreement entered into by City affecting, or related to, the Recreational Area shall not exceed the term of this Agreement. City acknowledges that the Leased Premises, or portions the reof, may be subject to possessory interest taxes, and that such taxes, if applicable, shall be paid by City or its sublessees and concessionaires.
This statement is intended to comply with Section 107.6 of the Revenue and Taxation Code.
City shall include a statement in all subleases and other agreements to the effect that the interests created therein may require the payment of a possessory interest tax.
4.5 Fees and Charges.
City may charge reasonable fees for the public to use the Recreation Area consistent with City's policies. Any fees and charges applicable to City residents shall be extended to District customer that live outside of the City. City may not charge District to access the Leased Area. In addition, City shall have authority to charge, or allow its concessionaires or sublessees (hereinafter collectively referred to as “s ublessees”) to charge, reasonable fees for services or use of the recreation facilities.
4.6 Use of Revenues.
All revenues received by City including entry fees, user fees, and rent payments shall be tracked separately and used to defray the costs and expenses for development, operation, administration, and maintenance of the Recreational Area. If at the termination of this Agreement City has surplus funds derived from revenues received in operating the Recreational Area, such funds shall be remitted to District. City shall maintain books and records relating to the costs and expenses relating to the operation of the Recreational Area which shall be available for District inspection and audit.
Amended & Restated South Lake Agreement Page 11 of 32
ARTICLE V: RESTRICTIONS ON USE AND DISTRICT RESERVATIONS
5.1 Water Level Fluctuation.
During the lease term, District shall have the right as it deems necessary to fluctuate the water level in South Lake related to water production and delivery without liability for damage to any improvements or operations of City and its sublessees. District shall provide City fifteen (15) days notice prior to utilizing the reservoir in a manner that affects water levels to allow City reasonable amounts of time to notice users. In the event of an emergency require use of water in South Lake, District will notify City as soon as it is reasonable.
Reservoir levels will fluctuate with rainfall, runoff, seepage, evaporation, and other environmental factors. Nothing in this agreement would require the District to maintain the reservoir at any level for recreational purposes.
5.2 Water Quality.
City shall not input, cause, or allow water to be drained into South Lake which may adversely affect water quality and/or District use of the water as determined in the sole discretion of District. City shall make all efforts to minimize and remove any debris, from its maintenance activities, from the water in South Lake.
5.3 Restrictions on Access.
District may close or otherwise restrict public access to the Recreational Area, or any portion thereof, whenever District determines in its reasonable discretion that such closure is necessary in the interest of water operations, public safety, Dam maintenance, or national security. District will take reasonable actions to promptly notify City in the event of a closure or restriction on access to the Recreational Area.
Amended & Restated South Lake Agreement Page 12 of 32
5.4 District Access and Improvements.
District, its officers, agents, and employees shall always have the right to access the Recreational Area including the right of ingress and egress, for any purpose recognizing that if time allows, there shall be reasonab le notice and understanding with City. District may also construct, operate, and maintain any facilities or improvements in the Recreational Area it deems necessary, including the removal or relocation of facilities constructed by City or its sublessees, who shall have no claim for damages or compensation from District, other than actual costs of relocation or reconstruction as reasonably determined by District and City.
[remainder of page intentionally left blank]
Amended & Restated South Lake Agreement Page 13 of 32
ARTICLE VI: INSURANCE
6.1 Insurance Coverage.
City, as a self -insured entity within its comparative insurance coverage, and its sublessees shall provide and maintain the following commercial general liability and automobile liability insurance:
Coverage for commercial general liability and automobile liability insurance shall be at least as broad as the following:
(a) Insurance Services Office (ISO) Commercial General Liability Coverage (Occurrence Form CG 0001).
(b) Insurance Services Office (ISO) Business Auto Coverage (Form CA 0001), covering Symbol 1 (any auto).
6.2 Coverage Limits.
Limits shall be no less than the following amounts:
(a) General Liability - Three million dollars ($3,000,000) per occurrence for bodily injury, personal injury, and property damage. If commercial general liability insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply to premises leased (with the ISO CG 2503, or ISO CG 2504, or insurer's equivalent endorsement provided to District ), or the general aggregate limit shall be twice the required occurrence limit.
(b) Automobile Liability - One million dollars ($1,000,000) for bodily injury and property damage each accident limit.
Amended & Restated South Lake Agreement Page 14 of 32
6.3 Endorsements.
The general liability and automobile liability policies are to contain, or be endorsed to contain, the following provisions:
(a) District, its directors, officers, employees, and authorized volunteers are to be given insured status (via ISO endorsement CG 2011, CG 2024 (if land only), or insurer's equivalent for general liability coverage) as respects: liability arising out of premises leased by City and its s ublessees; and automobiles owned, leased, hired, or borrowed by City and its s ublessees. The coverage shall contain no special limitations on the scope of protection afforded to District, its directors, officers, employees, or authorized volunteers.
(b) For any claims related to this lease, City and its sublessees' insurance shall be primary insurance with respects to District, its directors, officers, employees, or authorized volunteers. Any insurance, self -insurance or other coverage maintained by District, its directors, officers, employees, or authorized volunteers shall not contribute to it.
(c) Any failure to comply with reporting or other provisions of the policies including breaches of warranties shall not affect coverage provided to District, its directors, officers, employees, or authorized volunteers. (d) City and its s ublessees' insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability.
(e) Each insurance policy required by this agreement shall state or be endorsed to state that coverag e shall not be canceled by the insurance carrier or City and Amended & Restated South Lake Agreement Page 15 of 32
its sublessees, except after thirty ( 30) days ( ten (10) days for nonpayment of premium) prior written notice by U.S. mail has been given to District.
6.4 Additional Insured.
Such liability insurance shall name District as an additional insured and indemnify District against loss from liability imposed by law upon, or assumed under contract by, City and its s ublessees or their contractors for damages on account of such bodily injury (including death), property damage, and personal injury that may arise from, concern or be related to the use of the Leased Premises as a public recreational facility, together with its appurtenant facilities. Notwithstanding the foregoing, nothing in this Article VI shall require such liability insurance to indemnify City, its s ublessees, and their contractors, and/or District against loss from liability for damages and/or injuries that arise from, concern or are related to District's activities and/or its facilities except to the extent that the same are coextensive with the use of the Leased Premises as a public recreational facility with appurtenant facilities.
6.5 General Liability Coverage.
The general liability policy shall cover bodily injury and property damage liability, owned and non-owned equipment, and blanket contractual liability.
6.6 Automobile Coverage.
The automobile liability policy shall cover all owned, non- owned, and hired automobiles.
6.7 Insurance Forms.
All insurance shall be provided on policy forms and through companies satisfactory to District.
Amended & Restated South Lake Agreement Page 16 of 32
6.8 Insurance Deductible.
Any deductible or self -insured retention must be declared to and approved by District. At the option of District, the insurer shall either reduce or eliminate such deductibles or self-insured retentions.
6.9 Insurance Rating.
Insurance is to be placed with insurers having a current A.M. Best rating of not less than A-:VII or equivalent or as otherwise approved by District.
6.10 Certificates of Insurance.
Prior to execution of the agreement, City and its sublessees shall file with District a certificate of insurance (Acord Form 25- S or equivalent) signed by the insurer's representative evidencing the coverage required by this agreement. Such evidence shall include an additional insured endorsement signed by the insurer's representative and evidence of waiver of rights of subrogation against District. Such evidence shall also include confirmation that coverage includes or has been modified. City and its sublessees shall, upon demand by District, deliver to District such policy or policies of insurance and the receipts for payment of premiums thereon.
If any of the required coverages expire during the term of this Agreement, City and its sublessees shall deliver the renewal certificate(s) including the general liability additional insured endorsement and evidence of waiver of rights of subrogation against District to District at least ten (10) days prior to the expiration date.
Amended & Restated South Lake Agreement Page 17 of 32
6.11 Worker’s Compensation.
City and its sublessees and/or contractors shall comply with all California Worker's Compensation and Insurance Act laws and shall provide employer's liability insurance with minimum limits of one million dollars ($1,000,000) for each accident, a one million dollars ($1,000,000) disease policy, and one million dollars ($1,000,000) for each employee.
6.12 Dam Failure.
Dam failure liability insurance shall be carried by District at its expense.
[remainder of page intentionally left blank]
Amended & Restated South Lake Agreement Page 18 of 32
ARTICLE VII: DAMAGE OR DESTRUCTION DURING TERM OF LEASE
7.1 Restoration of Leased Premises.
If during the term of this Agreement, the Leased Premises are damaged, whether or not from a risk covered by insurance, and subject to the other provisions of this Agreement regarding termination, City shall promptly and expeditiously make the repairs necessary to restore the Leased Premises to a condition for occupancy or use comparable to the condition thereof before such damage, to the limit of insurance funds available.
7.2 Restoration of Dam and/or Appurtenant Facilities.
In the event of partial or complete destruction of the dam and/or its appurtenant facilities from any cause, neither District nor City, shall have any obligation to repair or replace or participate in any repair or replacement of the same. Should either party voluntarily elect to repair or replace the dam and/or appurtenant facilities in the event of such a loss, it shall do so at its sole cost. Should the parties jointly elect to repair or replace the dam and/or the appurtenant facilities, the costs of doing so shall be apportioned equally among them.
[remainder of page intentionally left blank]
Amended & Restated South Lake Agreement Page 19 of 32
ARTICLE VIII: CONDEMNATION
8.1 Condemnation.
In the event that the Leased Premises or any portion thereof are taken by eminent domain, or by inverse condemnation, or the reservoir water appropriated, District shall be entitled to entire award, including, but not limited to compensation, damages and interest, if any, provided that City shall be entitled to that portion of the award, if any which is attributable to improvements constructed by City or its s ublessees, and, in the case of the appropriation of the reservoir water, any portion of such award attributable to water belonging to City.
[remainder of page intentionally left blank]
Amended & Restated South Lake Agreement Page 20 of 32
ARTICLE IX: DEFAULT AND TERMINATION
9.1 Events of Default.
Subject to the notice and cure provisions of paragraphs 9.2 and 9.3 below, and the expiration of the cure period set forth therein, the following events shall constitute a default by City and a breach of this Agreement:
(a) Failure of City to maintain the Leased Premises in good condition as a recreational area or a material breach of any term or condition of this Agreement. (b) The subjection of any material right or interest of City to attachment, execution, or other levy, or to seizure under legal process which would materially interfere with City's ability to operate the Leased Premises as a recreational area. (c) An assignment by City for the benefit of creditors or the filing of a voluntary or involuntary petition by or against City under any law for the purpose of adjudicating City bankrupt.
(d) In the event the Leased Premises becomes a public nuisance, or otherwise unreasonably disturbs the peace and tranquility of the surrounding residents.
9.2 Notice and Right to Cure.
Prior to pursuing any remedy for an alleged default of City , District shall provide written notice of default City. Each notice of default shall specify in detail the alleged event of default and the intended remedy. City shall have one hundred and eighty (180) days after notice is given to cure the alleged default.
9.3 Remedies.
In the event a material default by City continues uncured for a period of one hundred and eighty (180) days, following written notice, then, in addition to the rights and remedies provided by law or equity, District may at its election terminate this Agreement by giving Amended & Restated South Lake Agreement Page 21 of 32
City written notice of termination. On the giving of notice, all City 's rights in the Leased Premises and improvements shall terminate. Promptly after notice of termination, City shall surrender and vacate the Leased Premises and all improvements in good and clean condition.
9.4 Termination by City .
City may terminate this Agreement at any time by giving written notice to District at least six (6) months prior to the effective date of such termination. Upon such termination, City must surrender the Leased Premises and all improvements in a good, clean, and undamaged condition, ordinary wear and tear excepted.
[remainder of page intentionally left blank]
Amended & Restated South Lake Agreement Page 22 of 32
ARTICLE X: ENVIRONMENTAL PROTECTION AND HAZARDOUS WASTE
10.1 Environmental Protection.
City and its sublessees shall implement and maintain storm-water BMP's to comply with all applicable environmental regulations. These regulations shall include a prohibition on the discharge, disposal, or escape of, any drainage water, non -point source runoff, raw sewage, sewage plant effluent, fuel, or waste of any kind, within or outside the Recreation Area which could result in destruction of habitat or the contamination or pollution of South Lake, as determined by District. City and its sublessees shall at all times comply with all applicable federal, state, and local law s, orders, and regulations, as may be amended, concerning the pollution of streams, canals, reservoirs, groundwater, or water courses, with respect to the proper discharge of refuse, garbage, sewage plant effluent, wastes, and other pollutants, including soil sediments, and shall cause all members of the public to comply fully with such laws, orders, and regulations.
10.2 Hazardous Materials.
City and its sublessees shall not use or allow anyone else to use the premises to generate, manufacture, refine, transport, treat, store, handle, recycle, release, or dispose of any hazardous material, other than as reasonably necessary for the operation of the Leased Premises by City and its s ublessees' activities as contemplated under this agreement. The term "hazardous material " means any hazardous substance, material, or waste, including but not limited to those listed in 49 CFR 172.101 (U.S. Department of Transporta tion), the Cal/EPA Chemical Lists , or petroleum products and their derivatives. However, this shall not apply to the use of petroleum products and related substances incidental to operation of motorized equipment and vehicles whose operation on the premises is contemplated by this agreement. City and its s ublessees shall immediately notify District in writing in the Amended & Restated South Lake Agreement Page 23 of 32
event of any release of hazardous material, violation of any environmental law, or actions brought by third parties against City and its s ublessees alleging environmental damage.
City shall indemnify and hold District harmless from any and all damages of any nature (including payment of attorney fees) related to or arising out of the discharge or release of hazardous materials.
[remainder of page intentionally left blank]
Amended & Restated South Lake Agreement Page 24 of 32
ARTICLE XI: ADDITIONAL COVENANTS OF CITY
11.1 Security of Recreation Area.
City shall be responsible for providing adequate security in the Recreation Area and shall ensure that the Recreation Area is patrolled by City staff. City shall install and maintain such security fencing around the Recreation Area as is necessary to prevent unauthorized entry, to the maximum extent possible. City shall also construct roads and gates within the Recreation Area as necessary for patrolling and surveillance. City, at its sole expense, shall maintain, in a condition satisfactory to District, all of the security fencing and all of those sections of the patrol road that are regularly used by City or by the public. No motorized vehicles shall be permitted to be used within the Recreation Area, except for maintenance purposes by City forces on specifically designated roads, parking lots or trails.
11.2 Signage and Displays.
District and City shall work cooperatively to develop appropriate signs and displays describing the multi -purpose functions of the Recreational Area and acknowledging the contributions of District and City. The cost of all signs and displays within the Leased Premises related to recreational uses shall be the sole responsibility of the City.
11.3 Entrance Gate.
City shall construct and operate an entrance gate through which all members of the visiting public shall be required to pass in order to gain access to the Recreation Area. The gate shall be locked during all non- operating hours. City shall be responsible for locking and unlocking the facility for public access. District personnel shall be provided with keys to the gate locks.
Amended & Restated South Lake Agreement Page 25 of 32
11.4 Boat and Water Contact Restrictions.
In the future, City and its sublessees may allow boats without gas/petroleum motors to use that portion of South Lake open to the public. All boats must be moored or taken out of the water at night and no boats shall be permitted outside the mooring area from one-half hour after sunset until one -half hour before sunrise. Prior to allowing any boats on South Lake, City shall obtain District approval for the installation of a buoy line to prevent unauthorized access to the upstream face of the South Lake dam. The buoy line shall be installed before the introduction of boats onto the lake. All costs associated with the design, installation and maintenance of the buoy line shall be the responsibility of City. All boats must remain outside the buoy line . If the buoy line fails to perform its intended function, boating operations must be suspended until the buoy system functionality is restored.
Fishing shall be a specifically authorized activity within the Leased Premises and City shall have the right, but not the obligation, to stock and periodically restock, the Reservoir with fish species appropriate to the Reservoir environment. City shall be responsible for the selective removal/eradication of inappropriate fish species at its cost.
No water body contact sports shall be permitted in South Lake unless specifically authorized by the State Health Department.
11.5 Annual Reporting.
City shall provide to District an annual report, in a form acceptable to District, on the operations of the Recreation Area.
Amended & Restated South Lake Agreement Page 26 of 32
ARTICLE XII SURRENDER AND DISPOSITION OF PREMISES
12.1 Surrender of Leased Premises.
Upon the expiration or earlier termination of this Agreement, City shall surrender the Leased Premises to District and all improvements in a good, clean, and undamaged condition, ordinary wear and tear excepted.
12.2 Disposition of City's Property upon Termination.
Upon the expiration or earlier termination of this Agreement, all equipment or personal property and all facilities or improvements constructed by City shall become the property of District. Portable and personal property may be removed prior to the termination date, or they shall become the property of District.
12.3 Assignment and Subletting.
City may not assign, sublease, transfer, or sell: (a) its rights and obligations under this Lease; or (b) any interest hereunder in the Improvements (including any assignment by operation of law), without prior written consent of District, which District may grant or withhold in its sole discretion.
[remainder of page intentionally left blank]
Amended & Restated South Lake Agreement Page 27 of 32
ARTICLE XIII: INDEMNIFICATION
13.1 Indemnification.
City shall defend, indemnify, and hold District harmless from, and reimburse District for, any loss, cost, expense, liability, or damages of every kind or nature, including but not limited to injury to or death of any person or destruction of property in connection with or in any way related to, the use by City, its sublessees, or any thir d party (including officers, directors, and employees of District) of the Leased Premises or any appurtenant facilities located thereon. In addition, City shall defend, indemnify, and hold District harmless from any breach or default in the performance of any obligation to be performed by City under this Agreement; any violation of governmental law or regulation; or any intentional misconduct or negligence of City , or any officer, agent, employee, guest, or invitee of City or its s ublessees, regardless of w hether such intentional misconduct or negligence was active or passive. Notwithstanding the foregoing, City shall not be obligated to indemnify District, its officers, directors, employees and/or agents, against loss from liability for damages and/or injuries that arise from, concern or are related to District's activities and/or its facilities except to the extent that the same are coextensive with the use of the Recreation Area as a public recreational facility with appurtenant facilities. District shall defend, indemnify, and hold City and its officers, agents, employees and s ublessees harmless from, and reimburse the same for, any loss, cost, expense, liability, or damages of every kind or nature, including but not limited to injury to or death of any person or destruction of property in connection with or in any way related to, District's activities and/or its facilities, except to the extent that the same are coextensive with the use of the Leased Premises as a public recreational facility with appurtenant facilities. Further, District shall defend, indemnify and hold City and its officers, agents, employees and sublessees harmless Amended & Restated South Lake Agreement Page 28 of 32
from, and reimburse the same for any loss, cost, expense, liability, or damages of every kind or nature, including but not l imited to injury to or death of any person or destruction of property in connection with or in any way related to any intentional misconduct or negligence of District, or any officer, agent, employee, quest or invitee of District, regardless of whether such intentional misconduct or negligence was active or passive.
In the event of the occurrence of any event which is an indemnifiable event pursuant to this section, the party seeking indemnification (“Indemnified Party”) shall notify the other party (“Indemnifying Party”) promptly, and, if such event involves the claim of any third person, the Indemnifying Party shall assume all expenses with respect to, the defense, settlement, adjustment, or compromise of any claim, pro vided that the Indemnified Party may, if it so desires, employ counsel at its own expense to assist in the handling of such claim. The Indemnifying Party shall obtain the prior written approval of the Indemnified Party, which approval shall not be unreason ably withheld, before entering into any settlement, adjustment, or compromise of such claim. The Indemnifying Party shall reimburse the Indemnified Party, or any third party Indemnified Party identified above for any legal expenses and costs incurred in co nnection with or in enforcing the indemnity herein provided. All indemnification obligations hereunder shall survive the expiration or earlier termination of this Agreement for the time period associated with all applicable causes of action.
[remainder of page intentionally left blank]
Amended & Restated South Lake Agreement Page 29 of 32
ARTICLE XIV: MISCELLANEOUS PROVISIONS
14.1 Governing Law.
This Agreement shall be governed by and construed in accordance with the laws of the State of California.
14.2 No Waiver of Breach.
No failure by either District or City to insist upon the strict performance by the other of any covenant, agreement, term, or condition of this Lease, or to exercise any right or remedy consequent upon a breach thereof, shall constitute a waiver of any such breach or of such covenant, agreement, term, or condition. No waiver of any breach shall affect or alter this Lease, but each and every covenant, condition, agreement, and term of this Lease shall continue in full force and effect with respect to any other then existing or subsequent breach.
14.3 Invalidity.
In the event that any one or more of the provisions contained in this Agreement shall be invalid, illegal, or unenforceable in any respect, the validity, legality, and enforceability of the remaining provisions contained in this Agreement shall not in any way be affected or impaired thereby. To the extent permitted by applicable law, each party to this Agreement waives any provision of law that renders any provision of this Agreement invalid, illegal, or unenforceable in any respect. In the event any provision of this Agreement shall be held invalid, illegal, or unenforceable, the parties shall use all reasonable efforts to substitute a valid, legal, and enforceable provision that implements the purposes and intents of this Agreement.
Amended & Restated South Lake Agreement Page 30 of 32
14.4 Notices.
All notices, requests, demands, waivers, consents, and other communications hereunder shall be in writing, shall be delivered either in person, by telegraphic, facsimile, or other electronic means, by overnight air courier, or by mail and shall be deemed t o have been duly given and to have become effective (a) upon receipt if delivered in person or by telegraphic, facsimile, or other electronic means calculated to arrive on any business day prior to 5:00 p.m. local time at the address of the addressee, or on the next succeeding business day if delivered on a non -business day or after 5:00 p.m. local time, (b) one business day after having been delivered to an air courier for overnight delivery, or (c) three business days after having been deposited in the ma il as certified or registered mail, return receipt requested, all fees prepaid, directed to the parties or their assignees at the following addresses (or at such other address as shall be given in writing by a party hereto):
If to City, addressed to:
City of San Marcos
Attn: Jack Griffin, City Manager
1 Civic Center Drive
San Marcos, CA 92069
Email: [email protected]
If to District, addressed to:
Vallecitos Water District
Attn: Glenn Pruim, General Manager
201 Vallecitos de Oro
San Marcos, CA 92069
Email: [email protected]
with a copy to counsel for City:
Lounsbery Ferguson Altona & Peak, LLP
Attn: Helen Holmes Peak
960 Canterbury Place, Suite 300
Escondido, CA 92025
Email: [email protected]
with a copy to counsel for District:
Best Best &Krieger LLP
Attn: James Gilpin, Esq.
655 West Broadway, Suite 1500
San Diego, CA 92101
Email: [email protected]
Amended & Restated South Lake Agreement Page 31 of 32
14.5 Entire Agreement.
This Agreement (including any exhibits and related agreements): (i) constitutes the entire agreement, supersedes all other prior agreements and understandings, both written and oral, among the parties, or any of them, with respect to the subject matter of this Agreement; (ii) is not intended to confer upon any person other than the parties to this Agreement any rights or remedies under this Agreement; and (iii) shall not be assignable.
14.6 Waiver; Amendment.
No modification, waiver, amendment, discharge or change to this Lease shall be valid unless the same is in writing and signed by the Party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
14.7 Additional Documents.
In addition to the documents and instruments to be delivered as provided in this Agreement, each of the parties shall, from time to time at the request of the other party, execute and deliver to the other party such other documents and shall take such other actions as may be reasonably required to carry out more effectively the terms of this Agreement.
14.8 Venue.
In the event any action or proceeding in commenced to enforce or interpret this Agreement, venue shall lie in the state or federal courts in or nearest the North County Judicial District of the County of San Diego.
14.9 Severability.
If any term, provision, covenant, or condition of this Lease is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remainder of the provisions shall remain in full force and effect and shall in no way be affected, impaired, or invalidated.
City of San Marcos, CA
City of San Marcos GIS
September 14, 2022
0 210 420105 ft
0 60 12030 m
1:2,257
Disclaimer: Map and parcel data are believed to be accurate, but accuracy is not guaranteed. This is not a legal document and should not be substituted for a title search,appraisal, survey, or for zoning verification.
EXHIBIT A