MEMORANDUM

To:     Mike Wildgen

          City Manager

From: Jeanette Klamm

          Residuals Coordinator

Re:     Agenda item

Date:  February 13, 2006

Please place the following item on the City Commission agenda for consideration at the next available meeting:

Project Description. Lease of 55 acres of farm ground adjacent to the Wastewater Treatment Plant for agricultural purposes.

Project Description/History.  The City has leased 55 acres of farm ground to local farmers for agricultural production purposes for many years. The previous lessee chose to give up the ground last fall (2005).

Project Status.  An RFP was conducted to collect proposals from local interested farmers to lease the property as per the City’s lease conditions. This RFP closed February 10.

Project Details. The submitted proposal prices are as follows:

Roger and Ralph Kitsmiller                              $76/ac.

Nunemaker-Ross (Pat Ross)                  $75/ac.

Neis Bros. Farms (Jim Neis)                  $72/ac.

Wise and Son Farms (John Wise)           $65/ac.

David Beebe/Jerry Neis                         $55/ac.

All 5 proposals have received biosolids through the City's biosolids program and understand the program well. The proposals did not contain anything that would disqualify them. They all agree to the conditions of the lease aggreement.

A copy of the lease agreement is attached for reference.

Project Funding.  The lease of the City’s 55 acres will return $4180 per year to the City.

Action Request.   Staff is recommending that the City Commission authorize the City Manager to enter into this lease agreement with Roger and Ralph Kitsmiller for $76/acre/year payable to the City for the lease of City property.