LEGISLATIVE ACTION ITEM
SPONSOR: Grover C. Robinson, IV, Mayor
SUBJECT:
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LEASE - MARTIN MARIETTA MATERIALS, INC FOR THE PORT OF PENSACOLA
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RECOMMENDATION:
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That City Council approve a lease with Martin Marietta Materials, Inc. for the Port of Pensacola. Further, that City Council authorize the Mayor to take all actions necessary to execute the lease.
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HEARING REQUIRED: No Hearing Required
SUMMARY:
Since 2002, Martin Marietta Materials has been a valued business partner of the port operating a five-acre aggregate terminal on the Port of Pensacola which directly supports regional construction and roadway projects with critical building materials.
For twenty years they have operated under a year-to-year short term operating agreement which has prevented them from competing on longer term contracts and from investing in improving the infrastructure of their terminal. A lease term of three years will give their corporate management security in committing funding to allow capital infrastructure and terminal improvements in partnership with the port.
Additionally, this lease will significantly increase revenues to the port by increasing cargo rates and fees; plus, it implements several new user fees that were not previously negotiated.
PRIOR ACTION:
February 27, 2002 - First annual terminal operating agreement executed with five annual renewals
June 29, 2007 - Second annual terminal operating agreement executed with five annual renewals
December 10, 2012 - May 21, 2015 - Annual short term operating agreements executed each year
May 22, 2015 to Present - Short term operating agreement with 365 day term until cancelled by either party
March 29, 2022 - Memorandum to City Council notifying of proposed lease with Martin Marietta
FUNDING:
N/A
FINANCIAL IMPACT:
Lease rate of $104,160 per year to be adjusted at renewal to appraised value (capped at 10%). Implements a new $13,440 charge for leasing of the space occupied by the offloading equipment (PPUA). Wharfage and stevedore fees increase to $0.71 and $0.15 per ton accordingly. Implements a new common area maintenance fee of 7.5% of base rent, currently $7,812.
LEGAL REVIEW ONLY BY CITY ATTORNEY: Yes
4/1/2022
STAFF CONTACT:
Kerrith Fiddler, City Administrator
Amy Miller, Assistant City Administrator for Enterprises
Clark Merritt, Port Director
ATTACHMENTS:
1) Martin Marietta Materials Inc. Lease Agreement - Draft
2) Deal Terms Summary Martin Marietta
PRESENTATION: No end