§ 17.10.140. Lease—Types.

A.

Short term lease. The mayor may lease borough land for a period not to exceed five years according to the terms fixed by ordinance and based on the land classification. The mayor shall not lease approved, unpatented general grant entitlement land without fully disclosing the unpatented status of the land to the lessee.

1.

An application to lease must be submitted with a development plan which shall disclose the use, nature of improvements, an estimate of value of the improvements, and a development and construction time table.

2.

The annual lease rate for a short term lease shall be established as the fair market rental value as determined by a qualified appraiser unless otherwise authorized by ordinance.

3.

Leased lands shall be utilized for purposes within the scope of the application, the terms and conditions of the lease, the applicable land classification and any land use or comprehensive plans. Utilization or development for other than the allowed uses shall constitute a violation of the lease and the lease will become subject to cancellation.

4.

Failure on the part of the lessee to substantially complete his development of the land or to not be consistent with the proposed use and terms and conditions of the lease within two years of the anniversary date of said lease shall constitute grounds for cancellation.

5.

Short term leases may not be assigned or renewed.

B.

Long term lease. The mayor may lease borough land for a period exceeding five years according to the terms fixed by ordinance and based on the land classification. The mayor shall not lease approved, unpatented general grant entitlement land without fully disclosing the unpatented status of the land to the lessee.

1.

An application to lease must be submitted with a development plan which shall disclose the use, nature of improvements, an estimate of value of the improvements, and a development and construction time table.

2.

The annual lease rate for the first five years shall be established as the fair market rental value as determined by a qualified appraiser unless otherwise authorized by ordinance.

3.

Unless otherwise authorized by ordinance, the lease rate shall be adjusted on the anniversary date of the lease every five years after the initial five year term. The adjusted lease rate shall be determined by a qualified appraiser and based on the fair market rental value.

4.

Lease lands shall be utilized for purposes within the scope of the application, the terms and conditions of the lease and in conformity with the lessee's development plan, applicable classification, and any land use of comprehensive plans. Utilization or development for other than the allowed uses shall constitute a violation of the lease and the lease will become subject to cancellation.

5.

Failure on the part of the lessee to substantially complete his development plan of the land or to not be consistent with the proposed use and terms and conditions of the lease within two years of the anniversary date of said lease shall constitute grounds for cancellation.

6.

For the purpose of interim financing or refinancing of the improvements to be placed upon the leased premises, and for no other purpose, a lessee may, upon written approval of the borough, encumber by mortgage, deed of trust, assignment or other appropriate instrument, the lessee's interest in the leased premises and in and to the lease, provided said encumbrance pertains only to the leasehold interest.

7.

Upon written approval of the borough, a long term may be assigned subject to the same terms and conditions of the existing lease.

C.

Agricultural lease. The mayor may lease borough land for agricultural purposes according to the terms fixed by the assembly including the applicable classification, except the mayor shall not lease approved, unpatented grant land without fully disclosing the unpatented status of the land to the lessee.

1.

An application to lease must be submitted with a farm management and development plan which shall disclose the use, nature of improvements, an estimate of value of the improvements, and a development and construction time table.

2.

The annual lease fees shall be established by the borough assessor with annual rates fixed for a minimum period of five years.

3.

Lease lands shall be utilized for purposes within the scope of the application, the terms and conditions of the lease and in conformity with the lessee's farm management and development plan, applicable classification, and any land use of comprehensive plans. Utilization or development for other than the allowed uses shall constitute a violation of the lease, and the lease will become subject to cancellation.

4.

Failure on the part of the lessee to substantially complete the lessee's farm management and development plan within the time frame specified in the plan, or failure to be consistent with the conditions of the lease shall constitute grounds for cancellation. The mayor or his designee shall determine whether the plan is substantially complete and may extend these deadlines for good cause shown or when the mayor determines it to be in the borough's best interests.

5.

Upon written approval of the borough, an agricultural lease may be assigned subject to the same terms and conditions of the existing lease. No agricultural lease may be assigned within two years of the anniversary date.

D.

Grazing lease. The mayor may lease borough land for grazing purposes according to the terms fixed by the assembly including the applicable classification, except the mayor shall not lease approved, unpatented grant land without fully disclosing the unpatented status of the land to the lessee.

1.

An application to lease must be submitted with a range management and development plan which shall disclose the use, nature of improvements, if any, an estimate of value of the improvements, the location of the proposed improvements, the description of the necessity for such improvements, and a statement that the improvements, as proposed, will not impair the value of the land or interfere with other reasonable uses thereof. Except as provided below, improvements of a permanent nature, such as housing, barns, sheds, slaughter houses, silos, and permanent grain or hay storage buildings, or other similar structures may not be authorized on a grazing lease. Should such structures be desired, the applicant must apply for a different form of lease in which such structures are authorized. The following uses and improvements may be authorized by the borough for use on grazing leases in a manner consistent with grazing lease uses and purposes:

a.

Permanent or temporary improvement of foliage quality and species to be used for grazing purposes by the lessee and not for sale or trade.

b.

Improvements to a spring to allow for an environmentally safe watering system.

c.

Fences in an approved place on the leased premises are not prohibited by this provision.

d.

Temporary animal facilities, such as corrals and chutes for loading animals.

e.

Temporary grain or hay storage facilities, provided such facilities may be no larger than the size necessary for storing a one-year supply of feed for the animals proposed to use the lease shown in the development plan.

f.

A maximum of ten percent of standing timber may be used for authorized lease improvements. Clearing of timber, other than that which is approved as necessary for grazing purposes, or the sale of timber taken from the grazing lease premises, is prohibited.

g.

Temporary living facilities such as cabins, tents, or other temporary structures as approved by the planning director, provided that the approved temporary living facilities must be removed upon the expiration of the lease.

2.

The annual lease fees shall be established by the borough assessor with annual rates fixed for a minimum period of five years.

3.

Lease lands shall be utilized for purposes within the scope of the application, the terms and conditions of the lease and in conformity with the lessee's range management and development plan, applicable classification, and any land use of comprehensive plans. Utilization or development by lessee for other than the allowed uses shall constitute a violation of the lease and the lease will become subject to cancellation. The mayor may contract with appropriate federal or state agencies to cooperatively manage borough grazing leases in conjunction with, or on behalf of, the borough.

4.

Failure on the part of the lessee to substantially complete the lessee's range management and development plan of the land within the time frame specified in the plan, or failure to be consistent with the conditions of the lease shall constitute grounds for cancellation. The mayor or his designee shall determine whether the plan is substantially complete and may extend these deadlines for good cause shown or when the mayor determines it to be in the borough's best interests.

5.

Upon written approval of the borough, a grazing lease may be assigned subject to the same terms and conditions of the existing lease.

6.

A grazing lease conveys no right, title, or interest held by the Kenai Peninsula Borough in any lands or resources and does not grant an exclusive right to use of the leased area, except as may be necessary to protect lessee's authorized assets as may be provided in the grazing lease.

7.

The lessee shall not prohibit or otherwise interfere with reasonable access to the leased area for other uses as may be authorized by the borough.

(Ord. No. 2002-15, §§ 2, 3, 6-4-02; Ord. No. 92-57, § 1(part), 1993)