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HomeMy WebLinkAbout21 - Amending Muni Code for Encroaching PiersAgenda Item No. 21 September 10, 2013 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: Public Works Department David A. Webb, Public Works Director 949 - 644 -3311, dawebb @newportbeachca.gov PREPARED BY: Chris Miller, Harbor Resources Manager 949 - 644- 3043—�Tniller@ n ewportbeachca.gov APPROVED: TITLE: Considbfation of Ordinance Amending Newport Beach Municipal Code Sections 17.35.020(F) and 17.60.060 Relating to Piers that Encroach in Front of Adjacent Properties and Commercial Indemnity, Respectively ABSTRACT: The City of Newport Beach ( "City') manages public tidelands on behalf of the State of California. Through this management, the City allows private individuals to construct and maintain piers. A small number of piers located upon the tidelands encroach in front of adjacent upland properties. When these encroaching piers are transferred, a new permit is required to be processed by the Harbor Commission rather than by staff through an administrative process. At the August 13, 2013 City Council meeting, the City Council directed staff to return with an Ordinance with clarifying language that allows staff to administratively process some transfers. Additionally, the tidelands permits and leases recently adopted by the City Council require commercial tidelands users to indemnify the City. For ease of use, it is proposed this indemnity obligation be placed within the Newport Beach Municipal Code ( "NBMC). RECOMMENDATION: (Select only one) 1) Conduct first reading of Ordinance No. 2013- 15 amending NBMC Sections 17.35.020(F) and 17.60.060 to allow certain administrative transfers of encroaching tidelands permits and to require commercial tidelands users to defend and indemnify the City, and pass to a second reading on September 24; or 2) Do not amend the NBMC and maintain the current process. FUNDING REQUIREMENTS: There are no funding requirements associated with either recommendation. 1 of 26 Consideration of Ordinance Amending Newport Beach Municipal Code Sections 17.35.020(F) and 17.60.060 Relating to Piers that Encroach in Front of Adjacent Properties and Commercial Indemnity, Respectively September 10, 2013 Page 2 DISCUSSION: As discussed at the August 13, 2013 Council meeting, there are a small number of piers which encroach in front of adjacent abutting upland properties (i.e., piers /floats encroach over the extension of their property lines into water area in front of a neighbor). These piers have existed for some time, and were allowed to encroach for various reasons at the time they were built decades ago. NBMC Section 17.35.020(F) currently requires that a new permit be approved by the Harbor Commission for these encroaching piers. The attached proposed Ordinance would allow staff to administratively process some transfers. Specifically, the City would have this authority when there is a change in ownership of the abutting upland property owner (i.e. immediate family members), a change in ownership of any entity that owns the upland property (i.e. between entities owned /controlled by the same person), or upon death of the permittee. Also included in this proposed Ordinance is clarifying language for an appeal, as well as codifying the indemnity obligations previously approved by the City Council for commercial tidelands permits and leases (see Exhibit B). ENVIRONMENTAL REVIEW: Staff recommends the City Council find this action is not subject to the California Environmental Quality Act ( "CEQA ") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. NOTICING: This agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers this item). Public Works Director Exhibits: A. Ordinance No. 2013- 15 Amending Sections 17.35.020(F) and 17.60.060 B. Redline Version of Amended NBMC Section C. Previous staff report from August 13, 2013 2 o 26 Exhibit A ORDINANCE NO. 2013 - 15 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH, CALIFORNIA AMENDING SECTIONS 17.35.020(F) AND 17.60.060 OF THE NEWPORT BEACH MUNICIPAL CODE TO ALLOW CERTAIN ADMINISTRATIVE TRANSFERS OF TIDELANDS PERMITS AND TO REQUIRE COMMERCIAL TIDELANDS USERS TO DEFEND AND INDEMNIFY THE CITY OF NEWPORT BEACH WHEREAS, pursuant to the 1978 Beacon Bay Bill, as amended, ('Beacon Bay Bill ") the City of Newport Beach ( "City') acts on behalf of the State of California as the trustee of tidelands located within the City's limits, including Newport Harbor; WHEREAS, Section 1(b) of the Beacon Bay Bill and Title 17 of the Newport Beach Municipal Code (" NBMC) allow the City to authorize third parties to use tidelands for commercial and noncommercial purposes for a term not to exceed fifty (50) years; WHEREAS, the City allows persons to operate and maintain commercial and noncommercial piers upon the tidelands under an annually issued permit or lease; WHEREAS, a small number of piers encroach in front of adjacent abutting upland property not controlled /owned by the permittee; WHEREAS, currently when a permit associated with a pier that encroaches in front of adjacent abutting uplands property is transferred the new permittee is required to seek a new permit from the Harbor Commission; WHEREAS, the City desires to amend the NBMC to allow these types of permits to be transferred administratively, when the transfer is between family members or entities controlled /owned by the same person; and WHEREAS, the City desires to codify the indemnity obligation previously approved by the City Council for commercial tidelands permits and leases. NOW THEREFORE, the City Council of the City of Newport Beach ordains as follows: KMIK -1 Section 1: Subsection 17.35.020(F) of the Newport Beach Municipal Code is hereby revised in its entirety to read as follows: F. Encroaching Piers and Floats. 1. In areas where existing piers and floats encroach in front of abutting upland property owned by others, a new permit approved by the Harbor Commission shall be required upon: a. Any change in type of existing use of the piers and floats; b. Any change in type of existing use of the abutting upland property owned by the permittee; and /or c. Any destruction of the pier and float in which over sixty (60) percent of the replacement value of the pier and float has been destroyed. 2. In areas where existing piers and floats encroach in front of abutting upland property owned by others, a permit shall be transferred, to the extent permitted by this Subsection, or a new permit obtained upon: a. Any change of the existing ownership of the abutting upland property owned by the permittee; b. Any change of the existing ownership of any entity that owns the abutting upland property; or C. The death of the permittee. In accordance with Subsection 17.60.030(0)(4), the City Manager or Harbor Resources Manager shall have authority to process an administrative transfer of a permit pursuant to Subsections 2(a),(b) and (c) between Immediate Family Members or between entities wholly owned /controlled by the same person. For purposes of this Subsection, "Immediate Family Members" shall mean the permittee's grandfather, grandmother, father, mother, brother, sister, wife, husband, or child. The Harbor Commission shall process all other permits required by this Subsection. 3. At least ten (10) calendar days before the Harbor Commission, City Manager or Harbor Resources Manager acts on 4 4 of 26 a permit under this Subsection, the owner of the abutting upland property, in front of which the harbor facility encroaches, shall be notified in writing of the time and place at which the permit will be considered. 4. Appeals arising under this Subsection related to permits or leases shall be processed under Section 17.60.080, or any successor section. Section 2: Subsection 17.60.060(E) of the Newport Beach Municipal Code is hereby revised in its entirety to read as follows: E. Commercial uses provided under this Title 17 are exempt from any provision requiring involvement of the owner or long -term lessee of an abutting upland property. This Subsection's sole purpose is to allow a person to apply for a commercial pier permit/lease in front of abutting upland property not owned or leased by the person applying for the permit. Section 3: Subsection "F" is added to Section 17.60.060 of the Newport Beach Municipal Code to read as follows: F. All persons that receive a commercial permit /lease, whether it is a new permit /lease or a transferred permit /lease, from the City to use public trust lands shall, to the fullest extent permitted by law, indemnify, hold harmless and defend (with counsel approved by the City, which approval shall not be unreasonably withheld) the City, its elected officials, officers, employees, agents, attorneys, volunteers and representatives from and against any and all claims, demands, obligations, damages, actions, causes of action, suits, losses, judgments, fines, penalties, liabilities, costs and expenses of every kind and nature whatsoever (individually, a "Claim" or collectively, "Claims "), which may arise from or in any manner relate (directly or indirectly) to the permit/lease including, but not limited to, the issuance of any permit /lease, the transfer of any permit/lease, the entry into any permit/lease, permittee's /lessee's occupancy or use, or permittee's /lessee's guests, invitees, 3 sublessees, or licensees occupancy or use, of the public trust lands, or improvements including, but not limited to, any use involving petroleum based products, hazardous materials, hazardous waste and /or other hazardous substances as defined by City, County, State or Federal laws and regulations. The permittee's /lessee's obligations in this indemnity shall not extend to the degree any Claim is proximately caused by the sole negligence or willful misconduct of the City, subject to any immunities which may apply to the City with respect to such Claims. This indemnification provision and any other indemnification provided elsewhere in an individual permit /lease shall survive the termination of said permit/lease and shall survive for the entire time that any third party can make a Claim. This indemnity obligation shall apply independent of whether it is explicitly placed within a particular commercial permit/lease Section 4: The recitals provided in this ordinance are true and correct and are incorporated into the substantive portion of this ordinance. Section 5: If any section, subsection, sentence, clause or phrase of this ordinance is, for any reason, held to be invalid or unconstitutional, such decision shall not affect the validity or constitutionality of the remaining portions of this ordinance. The City Council hereby declares that it would have passed this ordinance, and each section, subsection, clause or phrase hereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses and phrases be declared unconstitutional. Section 6: The City Council finds the approval of this ordinance is not subject to the California Environmental Quality Act ( "CEQA ") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Alternatively, the City Council finds the approval of this ordinance is not a project under CEQA Regulation Section 15061(b)(3) because it has no potential for causing a significant effect on the environment. m 6 of 26 Section 7: The Mayor shall sign and the City Clerk shall attest to the passage of this ordinance. The City Clerk shall cause this ordinance, or a summary thereof, to be published pursuant to Charter Section 414. This ordinance was introduced at a regular meeting of the City Council of the City of Newport Beach, held on the day of 2013, and adopted on the day of 2013, by the following vote, to wit: AYES. COUNCILMEMBERS NOES, COUNCILMEMBERS ABSENT COUNCILMEMBERS KEITH CURRY, MAYOR APPROVED AS TO FORM: THE CIT (JEY'S OFFICE AARON C. HARP. CITY ATTORNEY ATTEST: LEILANI I. BROWN, CITY CLERK 5 7 of 26 Exhibit B Redline Versions of Amended NBMC Section 17.35.020(F) and 17.60.060 Amendment of NBMC Section 17.35.020(F) Allowing Intra- Family & Related Business Transfers F. Encroaching Piers and Floats. 1. In areas where existing piers and floats encroach in front of abutting upland property owned by others, a new permit approved by the Harbor Commission shall be required upon: Ta. Any change in type of existing use of the piers and floats; 2b. Any change in type of existing use of the abutting upland property owned by the permittee; and /or 4c. Any destruction of the pier and float in which over sixty (60) percent of the replacement value of the pier and float has been destroyed. 52. -In areas where existing piers and floats encroach in front of abutting upland property owned by others, a permit shall be transferred, to the extent permitted by this Subsection, or a new permit obtained upon: a. Any change of the existing ownership of the abutting upland propert v owned by the permittee; b. Any change of the existing ownership of any entity that owns the abutting upland property; or C. The death of the permittee. In accordance with Subsection 17.60.030(C)(4) the City Manager or Harbor Resources Manager shall have authority to process an administrative transfer of a permit pursuant to Subsections 2(a),(b) and (c) between Immediate Family Members or between entities wholly owned /controlled by the same person. For purposes of this Subsection 8 of 26 "Immediate Family Members" shall mean the permittee's grandfather, grandmother, father, mother, brother, sister, wife, husband, or child. The Harbor Commission shall process all other permits required by this Subsection. 3. At least ten (10) calendar days Bbefore the Harbor Commission City Manager or Harbor Resources Manager acts on ath8 aew permit under this Subsection, the owner of the abutting upland property, in front of which the harbor facility encroaches, shall be notified in writing of the time and place fftee —:aat which the Raw permit will be considered. 4. Appeals arising under this Subsection related to permits or leases shall be processed under Section 17.60.080, or any successor section. Amendment of NBMC Section 17.60.060 to Clarify Indemnity Obligations 17.60.060 Public Trust Lands. The following restrictions shall apply to public trust lands under either a permit or a lease: A. Leases /Permits. In the event public trust lands are used by an entity other than the City, then that entity shall enter into a lease or permit with the City. Such leases shall provide lessees with a leasehold interest in the property for a period of at least five years, not to exceed a period of time as limited by the City Charter or applicable State law. Such permits shall provide permittees with an interest in the property for a period of twelve (12) months or less. B. Land Use. Leases and permits shall be for uses consistent with the public trust and Section 17.05.080. Preference shall be given to coastal- dependent uses. C. Public Access. Public access shall be provided in a manner consistent with applicable law. D. Revenue. Rent under this section shall be based upon fair market value, as determined by the City Council. Such determination shall be based, in part, upon the findings of a City - selected appraiser. 9 of 26 E. Commercial uses provided under this Title 17 are exempt from any provision requiring involvement of the owner or long -term lessee of an abutting upland property. This Subsection's sole purpose is to allow a person to apply for a commercial pier permit/lease in front of abutting upland property not owned or leased by the person applying for the permit. F. All persons that receive a commercial permit/lease, whether it is a new permit/lease or a transferred permit/lease, from the City to use public trust lands shall, to the fullest extent permitted by law, indemnify, hold harmless and defend (with counsel approved by the City, which approval shall not be unreasonably withheld) the City, its elected officials, officers, employees, agents, attorneys, volunteers and representatives from and against any and all claims, demands, obligations, damages, actions, causes of action, suits, losses, judgments, fines, penalties, liabilities, costs and expenses of every kind and nature whatsoever (individually, a "Claim" or collectively, "Claims "), which may arise from or in any manner relate (directly or indirectly) to the permit/lease including but not limited to, the issuance of any permit/lease, the transfer of any permit/lease, the entry into any permit/lease, oermittee's /lessee's occupancy or use, or permittee's /lessee's quests, invitees, sublessees, or licensees occupancy or use, of the public trust lands, or improvements including, but not limited to, any use involving petroleum based products, hazardous materials, hazardous waste and /or other hazardous substances as defined by City, County, State or Federal laws and regulations. The permittee's /lessee's obligations in this indemnity shall not extend to the degree any Claim is proximately caused by the sole negligence or willful misconduct of the City, subject to any immunities which may apply to the City with respect to such Claims. This indemnification provision and any other indemnification provided elsewhere in an individual permit/lease shall survive the termination of said permit/lease and shall survive for the entire time that any third party can make a Claim. This indemnity obligation shall apply independent of whether it is explicitly placed within a particular commercial permit/lease. 10 of 26 �EWPOR� = CITY OF u S NEWPORT BEACH City Council Staff Report Exhibit C Agenda Item No. 20 August 13, 2013 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: Public Works Department David A. Webb, Public Works Director 949 - 644 -3311, dawebb @newportbeachca.gov PREPARED BY: Chris Miller, Harbor Resources Manager APPROVED: 4,-S—�L A TITLE: Consideration of Ordi \)nces Amending Newport Beach Municipal Code Sections 17.35.020(F) and 17.60.060 Relating to Piers that Encroach in Front of Adjacent Properties and Commercial Indemnity, Respectively ABSTRACT: The City of Newport Beach ( "City ") manages public tidelands on behalf of the State of California. Through this management, the City allows private individuals to construct and maintain piers. A small number of piers located upon the tidelands encroach in front of adjacent upland properties. When these encroaching piers are transferred, a new permit is required to be processed by the Harbor Commission, rather than by staff through an administrative process. The City Council may consider amending these transfer provisions to allow for administrative processing. Additionally, the tidelands permits and leases recently adopted by the City Council require commercial tidelands users to indemnify the City. For ease of use, it is proposed this indemnity obligation be placed within the Newport Beach Municipal Code ( "NBMC "). RECOMMENDATION: (Select only one) 1) Conduct first reading of Ordinance No. 2013 -15 amending NBMC Sections 17.35.020(F) and 17.60.060 to allow certain administrative transfers of encroaching tidelands permits and to require commercial tidelands users to defend and indemnify the City, and pass to a second reading on September 10, 2013; or 2) Conduct first reading of Ordinance No. 2013 -15 repealing NBMC Section 17.35.020(F) to allow the administrative transfer of all encroaching tidelands permits and amending NBMC Section 17.60.060 to require commercial tidelands users to defend and indemnify the City, and pass to a second reading on September 10, 2013; or 11 of 26 Consideration of Ordinances Amending Newport Beach Municipal Code Sections 17.35.020(F) and 17.60.060 Relating to Piers that Encroach in Front of Adjacent Properties and Commercial Indemnity, Respectively August 13, 2013 Page 2 3) Select neither option 1 or 2 and maintain the current process. FUNDING REQUIREMENTS: There are no funding requirements associated with either recommendation DISCUSSION: Within Newport Harbor, there are a small number of piers which encroach in front of adjacent abutting upland properties (i.e., piers /floats encroach over the extension of their property lines into water area in front of a neighbor). These piers have existed for some time, and were allowed to encroach for various reasons at the time they were built. See examples in Exhibit A. NBMC Section 17.35.020(F) currently requires that a new permit be approved by the Harbor Commission for piers that encroach in front of adjacent upland property owned by others upon any of the following conditions: 1. Any change in type of existing use of the piers and floats; 2. Any change in type of existing use of the abutting upland property owned by the permittee; 3. Any change of existing ownership of the abutting upland property owned by the permittee or upon the death of the permittee; 4. Any destruction of the pier and float in which over sixty (60) percent of the replacement value of the pier and float has been destroyed. In an effort to improve the pier permit transfer process staff has prepared two alternative ordinances for the City Council's consideration designed to address piers that encroach in front of adjacent abutting upland properties. The first ordinance, attached as Exhibit B, amends NBMC Section 17.35.020(F) to allow certain transfers between family members or between related entities to be processed administratively, without the need for Harbor Commission review. This ordinance also amends NBMC Section 17.60.060 to codify the indemnity obligations previously approved by the City Council for commercial tidelands permits and leases. The second ordinance, attached as Exhibit C, repeals NBMC Section 17.35.020(F) in its entirety and allows for the administrative transfer of all pier permits. This ordinance also amends NBMC Section 17.60.060 to codify the indemnity obligations previously approved by the City Council for commercial tidelands permits and leases. There are no proposed indemnity obligations for non - commercial (e.g., residential) tidelands users under either ordinance. The redline amendments to the NBMC are shown in Exhibit D. 12 of 26 Consideration of Ordinances Amending Newport Beach Municipal Code Sections 17.35.020(F) and 17.60.060 Relating to Piers that Encroach in Front of Adjacent Properties and Commercial Indemnity, Respectively August 13, 2013 Page 3 These proposals originated through the City Council and were not taken to the Harbor Commission for consideration. ENVIRONMENTAL REVIEW: Staff recommends the City Council find this action is not subject to the California Environmental Quality Act ( "CEQA ") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. NOTICING: This agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers this item). Submitted by: AWA.� D vid A. e b Public Works Director Exhibits: A. Examples of Encroaching Commercial Piers B. Ordinance No. 2013 - _15 Amending Sections 17.35.020(F) and 17.60.060 C. Ordinance No. 2013 -15 Repealing Section 17.35.020(F) and Amending Section 17.60.060 D. Redline Version of Amended and Repealed NBMC Sections 13 of 26 1>° 'd4 � s 1 ' LAh*,.A Exhibit A 1 `> I ws� A 1 A Newport Beach accuracy Every reasonable effort has been made to assure the accuracy of the data provided. however, The City of GIS Newport Beach and its employees and agents disclaim any and all responsibility from or relating to rea' , any results obtained in its use. 0 40 80 aImagery: 2009 -2011 photos provided by Eagle C�<�100.Y✓ Feet Imaging wwwoagleaedal.com 14 of 26 z J i� J -'g oo • 1�.,A . '1023 1027 -1033 M V 1025_ 1029 1031 a Newport Beach Disclaimer: Every reasonable effort has been made to assure the accuracy of the data provided, however, The City of G IS Newport Beach and its employees and agents disclaim any and all responsibility from or relating to pE`+•'oq� any results obtained in its use e 0 100 200 Imagery: 2009-2011 photos provided by Eagle r " . Feet Imaging www.eagleaerial.com 15 of 26 ism m:3 ORDINANCE NO. 2013 - AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH, CALIFORNIA AMENDING SECTIONS 17.35.020(F) AND 17.60.060 OF THE NEWPORT BEACH MUNICIPAL CODE TO ALLOW CERTAIN ADMINISTRATIVE TRANSFERS OF TIDELANDS PERMITS AND TO REQUIRE COMMERCIAL TIDELANDS USERS TO DEFEND AND INDEMNIFY THE CITY OF NEWPORT BEACH WHEREAS, pursuant to the 1978 Beacon Bay Bill, as amended, ( "Beacon Bay Bill ") the City of Newport Beach ( "City ") acts on behalf of the State of California as the trustee of tidelands located within the City's limits, including Newport Harbor; WHEREAS, Section 1(b) of the Beacon Bay Bill and Title 17 of the Newport Beach Municipal Code ( "NBMC ") allow the City to authorize third parties to use tidelands for commercial and noncommercial purposes for a term not to exceed fifty (50) years; WHEREAS, the City allows persons to operate and maintain commercial and noncommercial piers upon the tidelands under an annually issued permit or lease; WHEREAS, a small number of piers encroach in front of adjacent abutting upland property not controlled /owned by the permittee; WHEREAS, currently when a permit associated with a pier that encroaches in front of adjacent abutting uplands property is transferred the new permittee is required to seek a new permit from the Harbor Commission; WHEREAS, the City desires to amend the NBMC to allow these types of permits to be transferred administratively, when the transfer is between family members or entities controlled /owned by the same person; and WHEREAS, the City desires to codify the indemnity obligation previously approved by the City Council for commercial tidelands permits and leases. NOW THEREFORE, the City Council of the City of Newport Beach ordains as follows: 16 of 26 Section 1: Subsection F(5) is added to Subsection 17.35.020(F) of the Newport Beach Municipal Code to read as follows: 5. This subsection shall not apply to the transfer of a permit between family members or between entities owned /controlled by the same person. Permits falling under this exception may be transferred administratively subject to approval by the City Manager or Harbor Resources Manager in accordance with Section 17.60.030(C)(4). Section 2: Subsection "F" is added to Section 17.60.060 of the Newport Beach Municipal Code to read as follows: F. All persons that receive a commercial permit or lease from the City to use public trust lands shall as a condition of receiving the commercial permit or lease defend and indemnify the City. Unless different language is provided within a specific commercial permit or lease, the following indemnity language shall be included, in substantially the same form, within every commercial. permit and lease: To the fullest extent permitted by law, permittee /lessee shall indemnify, defend (with counsel approved by the City, which approval shall not be unreasonably withheld) and hold harmless the City, its elected officials, officers, employees, agents, attorneys, volunteers and representatives from and against any and all claims, demands, obligations, damages, actions, causes of action, suits, losses, judgments, fines, penalties, liabilities, costs and expenses of every kind and nature whatsoever (individually, a "Claim" or collectively, "Claims "), which may arise from or in any manner relate (directly or indirectly) to this permit /lease including, but not limited to, permittee's /lessee's occupancy and use, or permittee's /lessee's guests, invitees, sublessees, or licensees occupancy and use, of the public trust lands, or improvements including, but not limited to, any use involving petroleum based products, hazardous materials, hazardous waste and /or other hazardous substances as defined by City, County, State or Federal laws and regulations. The permittee's /lessee's obligations in this indemnity shall not extend to the degree any Claim is proximately caused by the E 17 of 26 sole negligence or willful misconduct of the City, subject to any immunities which may apply to the City with respect to such Claims. This indemnification provision and any other indemnification provided elsewhere in this permit/lease shall survive the termination of this permit /lease and shall survive for the entire time that any third party can make a Claim. Section 3: The recitals provided in this ordinance are true and correct and are incorporated into the substantive portion of this ordinance. Section 4: If any section, subsection, sentence, clause or phrase of this ordinance is, for any reason, held to be invalid or unconstitutional, such decision shall not affect the validity or constitutionality of the remaining portions of this ordinance. The City Council hereby declares that it would have passed this ordinance, and each section, subsection, clause or phrase hereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses and phrases be declared unconstitutional. Section 5: The City Council finds the approval of this ordinance is not subject to the California Environmental Quality Act ( "CEQA ") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15050(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Alternatively, the City Council finds the approval of this ordinance is not a project under CEQA Regulation Section 15061(b)(3) because it has no potential for causing a significant effect on the environment. Section 6: The Mayor shall sign and the City Clerk shall attest to the passage of this ordinance. The City Clerk shall cause this ordinance, or a summary thereof, to be published pursuant to Charter Section 414. 3 18 of 26 This ordinance was introduced at a regular meeting of the City Council of the City of Newport Beach, held on the _ day of , 2013, and adopted on the day of 2013, by the following vote, to wit: AYES, COUNCILMEMBERS NOES, COUNCILMEMBERS ABSENT COUNCILMEMBERS KEITH CURRY, MAYOR APPROVED AS TO FORM: THE CITY A ORNEY'S OFFICE AARON C. HARP, CITY ATTORNEY ATTEST: LEILANI I. BROWN, CITY CLERK 17 19 of 26 Exhibit C ORDINANCE NO. 2013 - AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH, CALIFORNIA REPEALING SUBSECTION 17.35.020(F) AND AMENDING SECTION 17.60.060 OF THE NEWPORT BEACH MUNICIPAL CODE TO REQUIRE COMMERCIAL TIDELANDS USERS TO DEFEND AND INDEMNIFY THE CITY OF NEWPORT BEACH WHEREAS, pursuant to the 1978 Beacon Bay Bill, as amended, ('Beacon Bay Bill ") the City of Newport Beach ( "City ") acts on behalf of the State of California as the trustee of tidelands located within the City's limits, including Newport Harbor; WHEREAS, Section 1(b) of the Beacon Bay Bill and Title 17 of the Newport Beach Municipal Code ( "NBMC") allow the City to authorize third parties to use tidelands for commercial and noncommercial purposes for a term not to exceed fifty (50) years; WHEREAS, the City allows persons to operate and maintain commercial and noncommercial piers upon the tidelands under an annually issued permit or lease; WHEREAS, a small number of piers encroach in front of adjacent abutting upland property not controlled /owned by the permittee; WHEREAS, currently when a permit associated with a pier that encroaches in front of adjacent abutting uplands property is transferred the new permittee is required to seek a new permit from the Harbor Commission; WHEREAS, the City desires to repeal NBMC Subsection 17.35.020(F) to allow these types of permits to be transferred administratively, similar to the transfer of other tidelands permits; and WHEREAS, the City desires to codify the indemnity obligation previously approved by the City Council for commercial tidelands permits and leases. NOW THEREFORE, the City Council of the City of Newport Beach ordains as follows: Section 1: Subsection 17.35.020(F) of the Newport Beach Municipal Code is hereby repealed in its entirety. 20 of 26 Section 2: Subsection "F" is added to Section 17.60.060 of the Newport Beach Municipal Code to read as follows: F. All persons that receive a commercial permit or lease from the City to use public trust lands shall as a condition of receiving the commercial permit or lease defend and indemnify the City. Unless different language is provided within a specific commercial permit or lease, the following indemnity language shall be included, in substantially the same form, within every commercial permit and lease: To the fullest extent permitted by law, permittee /lessee shall indemnify, defend (with counsel approved by the City, which approval shall not be unreasonably withheld) and hold harmless the City, its elected officials, officers, employees, agents, attorneys, volunteers and representatives from and against any and all claims, demands, obligations, damages, actions, causes of action, suits, losses, judgments, fines, penalties, liabilities, costs and expenses of every kind and nature whatsoever (individually, a "Claim" or collectively, "Claims "), which may arise from or in any manner relate (directly or indirectly) to this permit/lease including, but not limited to, permittee's /lessee's occupancy and use, or permittee's /lessee's guests, invitees, sublessees, or licensees occupancy and use, of the public trust lands, or improvements including, but not limited to, any use involving petroleum based products, hazardous materials, hazardous waste and /or other hazardous substances as defined by City, County, State or Federal laws and regulations. The permittee's /lessee's obligations in this indemnity shall not extend to the degree any Claim is proximately caused by the sole negligence or willful misconduct of the City, subject to any immunities which may apply to the City with respect to such Claims. This indemnification provision and any other indemnification provided elsewhere in this permit/lease shall survive the termination of this permit/lease and shall survive for the entire time that any third party can make a Claim. 4 21 of 26 Section 3: The recitals provided in this ordinance are true and correct and are incorporated into the substantive portion of this ordinance. Section 4: If any section, subsection, sentence, clause or phrase of this ordinance is, for any reason, held to be invalid or unconstitutional, such decision shall not affect the validity or constitutionality of the remaining portions of this ordinance. The City Council hereby declares that it would have passed this ordinance, and each section, subsection, clause or phrase hereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses and phrases be declared unconstitutional. Section 5: The City Council finds the approval of this ordinance is not subject to the California Environmental Quality Act ( "CEQA ") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Alternatively, the City Council finds the approval of this ordinance is not a project under CEQA Regulation Section 15061(b)(3) because it has no potential for causing a significant effect on the environment. Section 6: The Mayor shall sign and the City Clerk shall attest to the passage of this ordinance. The City Clerk shall cause this ordinance, or a summary thereof, to be published pursuant to Charter Section 414. 3 22 of 26 This ordinance was introduced at a regular meeting of the City Council of the City of Newport Beach, held on the _ day of , 2013, and adopted on the day of 2013, by the following vote, to wit: AYES, COUNCILMEMBERS NOES, COUNCILMEMBERS KEITH CURRY, MAYOR APPROVED AS TO FORM: THE CITY ATTORNEY'S OFFICE ,;D Crl AARON C. HARP, CITY ATTORNEY ATTEST: LEILANI I. BROWN, CITY CLERK F1 23 of 26 Exhibit D Redline Versions of Amended NBMC Section 17.35.020(F) and 17.60.060 Amendment of NBMC Section 17.35.020(F) Allowing Intra- Family Transfers F. Encroaching Piers and Floats. In areas where existing piers and floats encroach in front of abutting upland property owned by others, a new permit approved by the Harbor Commission shall be required upon: 1. Any change in type of existing use of the piers and floats; 2. Any change in type of existing use of the abutting upland property owned by the permittee; 3. Any change of existing ownership of the abutting upland property owned by the permittee or upon the death of the permittee; 4. Any destruction of the pier and float in which over sixty (60) percent of the replacement value of the pier and float has been destroyed. 5. This subsection shall not apply to the transfer of a permit between family members or between entities owned /controlled by the same person. Permits falling under this exception may be transferred administratively subject to approval by the City Manager or Harbor Resources Manager in accordance with Section 17.60.030(C)(4). Before the Harbor Commission acts on the new permit, the owner of the abutting upland property, in front of which the harbor facility encroaches, shall be notified in writing of the meeting in which the new permit will be considered. Repeal of NBMC Section 17.35.020(F) z - z - 24 of 26 a. - ME _. MINMEM: - _ Amendment of NBMC Section 17.60.060 to Clarify Indemnity Obligations 17.60.060 Public Trust Lands. The following restrictions shall apply to public trust lands under either a permit or a lease: A. Leases /Permits. In the event public trust lands are used by an entity other than the City, then that entity shall enter into a lease or permit with the City. Such leases shall provide lessees with a leasehold interest in the property for a period of at least five years, not to exceed a period of time as limited by the City Charter or applicable State law. Such permits shall provide permittees with an interest in the property for a period of twelve (12) months or less. B. Land Use. Leases and permits shall be for uses consistent with the public trust and Section 17.05.080. Preference shall be given to coastal- dependent uses. C. Public Access. Public access shall be provided in a manner consistent with applicable law. D. Revenue. Rent under this section shall be based upon fair market value, as determined by the City Council. Such determination shall be based, in part, upon the findings of a City - selected appraiser. 25 of 26 E. Commercial uses provided under this Title 17 are exempt from any provision requiring involvement of the owner or long -term lessee of an abutting upland property. F. All persons that receive a commercial permit or lease from the City to use public trust lands shall as a condition of receiving the commercial permit or lease defend and indemnify the City. Unless different language is provided within a specific commercial permit or lease, the following indemnity language shall be included, in substantially the same form, within every commercial permit and lease: To the fullest extent permitted by law, permittee /lessee shall indemnify, defend (with counsel approved by the City, which approval shall not be unreasonably withheld) and hold harmless the City, its elected officials, officers, employees, agents, attorneys, volunteers and representatives from and against any and all claims, demands, obligations, damages, actions, causes of action, suits, losses, iudgments, fines, penalties, liabilities, costs and expenses of every kind and nature whatsoever permittee's /lessee's occupancy and use, or Permittee's /lessee's guests, invitees, materials, hazardous waste and/or other hazardous substances as defined by City, County. State or Federal laws and regulations. The permittee's /lessee's obligations in other indemnification provided elsewhere in this permit/lease shall survive the termination of this permit/lease and shall survive for the entire time that any third party can make a Claim. 26 of 26 August 15, 2013 Newport Beach City Council City of Newport Beach 100 Civic Center Drive Newport Beach, CA 92660 Re: Newport Beach City Council Regular Meeting of August 13, 2013 Current Business Agenda Item No. 20 Honorable Council Members: I represent John Vallely, owner of the property at 508 South Bay Front, Balboa Island. I have also been a resident of Newport Beach for almost 40 years. Mr. Vallely's property is one of the properties identified by City staff as affected by the proposed amendments to NBMC Sections 17.35.020(F) and 17.60.060 — Item No. 20 on the Agenda for August 13, 2013. It is my understanding these proposed amendments come from the City Attorney's office, and have been under discussion for some time. However, it is probably fair to say the Vallely dock situation may have prompted the City Attorney's office to propose the amendments at this time. My understanding is that the Vallely dock presents a situation not encountered previously by the City's current Harbor Resource Department, but one that will be encountered for other properties in the future. Initially, it is important to understand what Mr. Vallely asked the Harbor Resources Department to do. Mr. Vallely's parents owned and resided at 508 South Bay Front for over 75 years. Following his mother's death in 2012, and the administration of his mother's trust that held title to 508 South Bay Front, Mr. Vallely's trust became the owner of the property. W. Vallely subsequently applied for a transfer of the commercial pier permit, held in the name of his parents' trust, to his trust. There is nothing more to the application — it is simply a request to change the name on the commercial pier permit_ following the parent/child transfer. Citing current NBMC Section 17.35.020(F)(3), the Harbor Resource Manager took the position that Mr. Vallely must go through the process of applying for a new commercial pier permit. Mr. Vallely disputes this interpretation and is prepared to file a writ in Superior Court to compel the transfer. Among other reasons, Mr. Vallely disputes the decision because Section 17.60.060(E) exempts commercial piers from the provisions of Section 17.35.020(F)(3). —n -n f. ' ' HARRY S. CARMACK ATTORNEY AT LAW�� J� D —)3 474 E. 17th Street, Suite 201 9 Costa Mesa, Califomia 92627 Tel: 949- 642 -5548 Fax: 949 -642 -1588 E -mail: hcarmadc @pacbell.net August 15, 2013 Newport Beach City Council City of Newport Beach 100 Civic Center Drive Newport Beach, CA 92660 Re: Newport Beach City Council Regular Meeting of August 13, 2013 Current Business Agenda Item No. 20 Honorable Council Members: I represent John Vallely, owner of the property at 508 South Bay Front, Balboa Island. I have also been a resident of Newport Beach for almost 40 years. Mr. Vallely's property is one of the properties identified by City staff as affected by the proposed amendments to NBMC Sections 17.35.020(F) and 17.60.060 — Item No. 20 on the Agenda for August 13, 2013. It is my understanding these proposed amendments come from the City Attorney's office, and have been under discussion for some time. However, it is probably fair to say the Vallely dock situation may have prompted the City Attorney's office to propose the amendments at this time. My understanding is that the Vallely dock presents a situation not encountered previously by the City's current Harbor Resource Department, but one that will be encountered for other properties in the future. Initially, it is important to understand what Mr. Vallely asked the Harbor Resources Department to do. Mr. Vallely's parents owned and resided at 508 South Bay Front for over 75 years. Following his mother's death in 2012, and the administration of his mother's trust that held title to 508 South Bay Front, Mr. Vallely's trust became the owner of the property. W. Vallely subsequently applied for a transfer of the commercial pier permit, held in the name of his parents' trust, to his trust. There is nothing more to the application — it is simply a request to change the name on the commercial pier permit_ following the parent/child transfer. Citing current NBMC Section 17.35.020(F)(3), the Harbor Resource Manager took the position that Mr. Vallely must go through the process of applying for a new commercial pier permit. Mr. Vallely disputes this interpretation and is prepared to file a writ in Superior Court to compel the transfer. Among other reasons, Mr. Vallely disputes the decision because Section 17.60.060(E) exempts commercial piers from the provisions of Section 17.35.020(F)(3). Newport Beach City Council City of Newport Beach August 15, 2013 Page 2 of 4 At Tuesday night's council meeting, several speakers during public comment grossly misrepresented the status of the Vallely dock matter. In watching the meeting on television, it appeared to me some Members might have been influenced by these misrepresentations, or concerned about the proposed amendments based on these misrepresentations. For that reason, I feel it is necessary to correct the misrepresentations so Members have the correct information. First, contrary to the repeated representations of the adjacent property owner at 510 South Bay Front, and her attorney, the Vallely dock is not an illegal structure or use. The attorney should know better than to make such an incorrect representation to the Council. Councilman Selich corrected the speakers when he stated that the dock was not illegal, but rather a "legal non - conforming use." A "legal nonconforming use" is "a lawful use existing on the effective date of the zoning restriction and continuing since that time in nonconformance to the ordinance." (City of Los Angeles v. Gage (1954 127 Cal.App.2d 442, 453.) A property owner has a vested right to continue lawful uses of property and is not required to obtain a special use permit in order to continue lawful preexisting uses. (City of Ukiah v. County of Mendocino (1987) 196 Cal.App.3d 47, 56.) Transfer of title does not affect the right to continue a lawful nonconforming use which runs with the land. (Hanson Brothers Enterprises, Inc. v. Board of Supervisors of Nevada County (1996) 12 Ca1.4`s 533, 540.) 508 South Bay Front was purchased by Roland Vallely, John Vallely's father, in 1935. The property had an existing pier. On April 27, 1936, Roland Vallely was granted a War Department Permit by the Army Corps of Engineers to construct two wooden floats and three anchor piles in front of his existing pier. These floats and pilings crossed the extended property line of the adjacent property at 510 South Bay Front. On July 18, 1938, the Newport Beach City Council granted Mr. Vallely's request to install an additional float, having received the approval of the owner of 510 South Bay Front and the City Engineer. The floats as constructed have been used and maintained in the same configuration for approximately 75 years. The Vallely family has operated the marina as a boat rental and/or boat slip rental for the entire 75 years. The Vallely family has paid property taxes on this dock, specifically listed by the tax assessor as an improvement to their property, for over 75 years. According to City staff reports in 1965 and 1966, there were no City pier permits or harbor policies when Roland Vallely constructed the additions to the pier in 1936 and 1938. When policies were adopted, it was legal to construct commercial piers that "encroached" across a neighbor's extended property line. (Section 1 -B of the former Harbor Permit Policies.) The Vallely dock was a lawful use in compliance with original permits and existing policies for almost thirty years. On January 9, 1967, the City Newport Beach City Council City of Newport Beach August 15, 2013 Page 3 of 4 authorized the addition of Section 29 to the then Harbor Permit Policies. This Section 29 pertained to the elimination of encroaching pier and float facilities. At that time, the Vallely commercial dock became a "legal non - conforming use," and remains a "legal non - conforming use" to this day. The dock is not an illegal structure or use. The language of prior Section 29 carries forward almost verbatim in today's Section 17:35.020(F). Second, contrary to what several speakers represented to the Council, Mr. Vallely has not applied for a new business permit and has not expanded or changed the 75 -year use of the dock. The information provided by these speakers is a complete fabrication. The Vallely family has held a business license for their commercial use for almost 75 years --first in the name of Roland Vallely, and since 1972 in the name of the Vallely Family Trust. The business license is renewed annually by paying the license fee. John Vallely recently renewed the license as required by paying the annual fee, and, since his trust is now the property owner, put the license in his trust's name. There is no application for a new license. Nothing has changed with the respect to the dock or its use. The representations that Mr. Vallely is doing something that changes the parking situation as it has always existed are false. The dock space is exclusively leased to boat owners, just as it has been for over the last 30 years. Finally, let me provide some history on the adjacent property — 510 South Bay Front. I feel it is important since that property owner now opposes the amendments to these ordinances. 510 is the end property of the city block that was originally zoned for commercial use. It borders Opal Street, with the City's pier extending from the end of Opal Street. An aerial photograph taken in 1952 shows a sandwich shop stand at 510, the Vallely dock, commercial businesses, a gas dock, etc., along the block. The commercial block is currently zoned Mix Use Water Related, which allows commercial uses. Vallely's commercial use is an approved use. According to John Vallely, who grew up at 508 next door, sometime in the 1970's the owner of 510.applied for and down -zoned the 510 property in order to build a duplex on the property. In other words, a prior owner of 510, for that owner's own economic benefit, created a situation wherein 510 became a lone, residential - zoned property at the end of the commercial -zoned block. There are to this day "encroaching" commercial docks on the entire 500 block, and on the 400 block on the other side of the ferry at Agate Street. This situation was visible to anyone who purchased 510, yet the current owner of 510 now opposes amendments to the ordinances that would allow these commercial dock owners to be treated like everyone else in the harbor, i.e., to be allowed to transfer their commercial dock permit to a family member or related entity without applying for a new permit. Newport Beach City Council City of Newport Beach August 15, 2013 Page 4 of 4 I've already indicated the prior property owner at 510 gave his approval to construct the "encroaching" dock in 1938, approval that was subsequently put in a written, notarized letter. The current owner of 510 doesn't want to recognize Vallely's vested right to maintain the existing dock, a right that vested between the property owners when her predecessor at 510 approved the construction of the dock and Vallely paid for the construction. This vested right runs with the land and is transferable to subsequent owners. Instead, the current owner at 510 is trying to accomplish her goal, the removal of the encroaching dock, by urging the City to require Vallely to apply for a new permit for the dock — one that she will strenuously oppose. Vallely's position is that his right to the current permit is also a vested right between Vallely and the City, that the current permit is transferable as a matter of law, and that the City may not require Vallely to apply for a new permit. Members may recognize this position as asserting what is commonly referred to as "grandfathered" rights. Vallely is asserting rights held before changes to City ordinances. The bottom line is that the current owner of 510 South Bay Front knows that as between her and Vallely, she has no legal right to remove the encroaching dock. She bought the property with full knowledge of the encroachment, and had every right to investigate Vallely's vested right to maintain the dock pursuant to the prior owner's permission to build it. She threatened legal action through her same attorney nine years ago, but has done nothing because she knows she has no remedy at law. Now, she is trying to reach her goal by opposing amendments to the ordinances that would treat Vallely like everyone else in the harbor - amendments that should avoid legal action between Vallely and the City. would be more than happy to discuss the Vallely dock situation with any Member. Very truly yours, 1/,,� C",( HARRY S. CARMACK HSC/Vallely.ltr