BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
RECE~VED
CLERK’S OFFICE
CaseNo. PCBNo. 03-191
NOV flY
2005
STATE OF ILLINOIS
Pollution Control Board
INC., an Illinois corporation, and the CITY OF
MORRIS, an Illinois municipal corporation,
Respondents.
)
)
)
TO:
All counsel ofRecord (see attached Service List)
Please take notice that on November 8, 2005, the undersigned filed with the Illinois
Pollution Control Board, 100 West Randolph Street, Chicago, Illinois 60601, City of Morris’
Reply to the Complainant’s Response to Cross-Motion for Summary Judgment.
Dated November 8, 2005
Respectfully Submitted,
HINSHAW & CULBERTSON LLP
100 Park Avenue
P.O. Box 1389
Rockford, IL 61105-1389
815-490-4900
On behalfof the CITY OF MORRIS
This document
utilized 100
recycled paper products
PEOPLE OF THE STATE OF ILLINOIS
Complainant,
vs.
)
)
)
)
)
)
COMMUNITY LANDFILL COMPANY,
)
NOTICE OF FILING
By: Hinshaw
~orneys
70415199v1 806289
BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
~ E C E IV ED
CLERK’S OFFICE
PEOPLE OF THE STATE OF ILLINOIS
)
NOV
0 ~2oos
Complainant,
PollutionSTATE
OFControlILLINOISBoard
vs.
)
Case No. PCB 03-191
COMMUNITY LANDFILL COMPANY, INC.,)
an Illinois corporation, and the CITY OF
)
MORRIS, an Illinois municipal corporation.
)
)
Respondents.
)
REPLY
OF CITY OF
MORRIS
TO COMPLAINANT’S RESPONSE TO CROSS-
MOTION FOR SUMMARY JUDGMENT
NOW COMES Respondent, CITY OF MORRIS, by and through its attorneys,
HINSHAW & CULBERTSON, LLP and in reply to the Complainant’s Response to Cross-
Motion For Summary Judgment, states as follows:
I.
The City of Morris is Entitled to Judgment Because as a Matter of Law it has Not
Conducted Any Disposal Operation Since the Date the Financial Assurance Requirements
Went into Effect as to Municipalities (April 9, 1997).
The State of Illinois has attempted to mislead the Illinois Pollution Control Board by
arguing that the City of Morris conducted a waste disposal operation simply because the City of
Morris was listed as an operator on permits issued decades ago. As evidence of ownership, the
State relies upon two permits which were issued in 1974 and supplemental permits issued in
1978, 1980, and 1989 that list the City of Morris as “owner and operator”. However, before
April 9, 1997, there was no obligation upon a local unit of government to post any financial
assurance. Section 807.601(a) still explicitly provides that “the financial assurance requirement
does not apply to the State of Illinois, its agencies and institutions, or to any unit of local
government”. 35 Ill.Admin.Code 807.601(a). Furthermore, the regulations for new landfills
70463228v2 806289
(Section 811) explicitly provide that “except as provided in subsection (1) this subpart does not
apply to the State of Illinois, its agencies and institutions, or to any unit of local government. 35
Ill.Admin.Code 811.700(c). (Emphasis added). Subsection (1) provides “on or after April 9,
1997, no person, other than the State of Illinois, its agencies and institutions, shall conduct any
disposal operation at an MSWLF unit that requires a permit under subsection(d) of Section 21.1
ofthe Act, unless that person complies with the financial assurance requirement of this Part.” 35
Ill.Admin.Code 811.700(1). Therefore, at the time that the City of Morris allegedly operated the
landfill (prior to 1982) and received the permits that listed it as owner or operator, there was no
requirement that the City of Morris post financial assurance. Furthermore, at no time after April
9, 1997 has the City of
Morris ever “conducted any disposal operation” at the site.
“It is clear that whether one is an operator pursuant to the Act depends on the specific
facts as a whole.”
People v. Bishop,
315 Il1.App.3d 976, 979, 735 N.E.2d 754, 757
(5~
Dist.
2000). “A review of the Pollution Control Board decisions reveals that whether a party’s name
is listed as an operator in the permit is not the determining factor of whether one is an operator.”
Id.
at 979, 735 N.E.2d at 758 (emphasis added). In the
Bishop
case, Dean Bishop argued that he
was not the operator; however, the Illinois Appellate Court reviewed the relevant facts and
determined that: 1) Dean was frequently at the landfill when inspectors were present, and 2) he
worked at the landfill on a continuous basis, (he was observed spreading and compacting waste,
operating the front-end loader, conducting a trash-hauling and disposal service, discussed with
inspectors conditions at the landfill, on-going violations, and efforts to remedy the violations,
and also worked at the landfill in exchange for the use of the landfill). Furthermore, Dean
pledged a certificate of deposit of $25,000 for the landfill, expended nearly $75,000 to maintain
the landfill, deducted these amounts from his federal income taxes, and listed the landfill as his
2
70468228v2 806289
principal business on his income tax returns. Unlike the alleged operator in
Bishop,
in this case,
it is undeniable that since 1982 the City of Morris has not “conducted” any disposal operation.
No employee ofthe City of Morris worked at the landfill, no employee of the City ofMorris was
observed spreading and compacting waste, no City employee has operated waste or earth moving
equipment at the landfill, and the City has not conducted any waste disposal operations or other
operations at the landfill. (See Affidavit of Mayor Dick Kopczick, marked Exhibit A). Thus,
pursuant to the determinative facts involved in
Bishop
the City has not conducted a waste
disposal operation.
One of the cases relied upon by the
People v. Bishop
court is
Termaat v. City of
Belvidere,
PCB 85-129 (1986); 1986 (1986 WL 27133). In
Termaat
the central issue involved
was whether or not an individual (as opposed to a municipality) was “conducting any disposal
operation” at the site, thereby triggering the need to post financial assurance. (Under the law in
effect at that time 1986, there was no requirement that a municipality post financial assurance).
The Pollution Control Board noted that the exception against posting financial assurance only
applied to “the goverm-nent unit as the owner of the site, but if another person conducts waste
disposal on the site, then the other person must provide financial assurance for closure.”
Id.
at
*2. The landfill was jointly owned by the City and the County, and Mr. Anderson was an
independent contractor hired to perform certain functions at the landfill in exchange for a
monthly payment by the City and County. The scope of work provided included furnishing all
equipment, labor, supplies and other items of expense necessary to perform earth work, compact
refuse, dispose of landscape waste, and place immediate and final cover. However, the contract
explicitly provided that this work was performed “under the direction of the owner and its
authorized representative”.
Id.
The City and County opened the site each day, maintained the
3
70468228v2 806289
access road to the scale house, employed persons to perform weigh-ins and collect fees, provided
cover and seeding materials, maintained the paved access road from the entrance to the scale
house, set rates, and paid all bills.
Id.
at *3 It was noted that Mr. Anderson did not have a lease,
and received no income from the operation independent of his monthly fee. Furthermore, the
governmental entities maintained a committee that met each month to set rates, collect fees,
prepare contracts, pay bills and review conditions at the site. The Pollution Control Board
concluded that the two local units of government and not Mr. Anderson were the operator of the
site within the meaning of the Act, and, as such, no financial assurance was required to be
posted. The Pollution Control Board noted “Mr. Anderson is under the on-going supervision of
the City Director of Public Works; his discretion is limited in the performance of his contractual
duties and is non-existent in other aspects of site operations.”
Id.
at *3•
In this case, every IEPA employee who has testified in this matter has conceded that the
day-to-day operations of the landfill are performed by CLC and not the City ofMorris. There is
simply no evidence that the City of Morris ever maintained any roads on the facility, employed
any person to perform weigh-ins or collect fees, provided cover and seeding materials for the
facility, paid any expenses of the facility, was consulted on or otherwise determined tipping rates
for the site, collected any fees, prepared any contracts, or reviewed any conditions at the site.
Therefore, the actual conduct of the City clearly establishes that it is not conducting a waste
disposal operation, and thus, has no duty to post financial assurances for closure/post-closure
care.
The State of Illinois attempts to argue that the City of Morris has conducted a waste
disposal operation based upon four factors; (a) permitting, (b) joint action with Respondent
Community Landfill Company, (c) financial benefits, and (d) distinguishing the
Berger
case.
4
70468228v2 806289
First, it is well established that the fact that one’s name appears on the permit as an operator does
not mean that one is conducting waste disposal operations, thereby subjecting it to the financial
assurance regulations. Rather, it is incumbent upon the Board to look at the facts of the case to
determine who was truly conducting landfill operation at the site.
People v. Bishop; Terinoat v.
City of Belvidere.
Furthermore, as explained above, the permits that the State is attempting to
rely upon were issued at a time when the City of Morris was excluded from posting financial
assurance by the Illinois regulations. Those regulations changed with the passage of Section
811, and Subpart (C) carried forward the exclusion of municipalities from liability for posting
financial assurance unless the municipality conducted disposal operation after April 9, 1997.
(Section 811.700(c),
(1)).
Therefore, the Illinois legislature recognized that it was quite possible,
if not likely, that a municipality might be listed as an operator of a landfill on a permit, but that
fact alone would not subject the municipality to the financial assurance requirement unless that
municipality actually conducted waste disposal operations after April 9, 1997. The State of
Illinois has presented absolutely no evidence that the City of Moths ever conducted the day-to-
day waste disposal operations of the landfill since that date.
Second, the State of Illinois asserts the City engaged in some amorphous form of joint
venture with CLC, and that the City “contracted with Respondent Community Landfill
Company, applied for and was issued joint waste permits, provided non-compliant financial
assurance..., litigated the validity of the Frontier Bonds along with CLC, and failed to replace
the Frontier Bonds with substitute financial assurance.” However, none of these assertions
establish that the City of Moths was in anyway conducting waste disposal operations at the site.
Contracting with CLC does not establish the conduct oflandfill operations at the site. Moreover
the State does not clearly indicate what “contract” it is referring to between CLC and the City of
5
7O46S228v2 806289
Moths. Regardless, it is well established that merely contracting with an operator does not make
the other contracting party the “conductor” of a landfill operation.
People v. Bishop; Tertnaat,
and
Berger.
Indeed, in both
Termaat
and
Berger
a party who contracted with the actual operator
was determined not to be the operator. Furthermore, the PCB has consistently held that merely
being the owner of a landfill does not mean that one is conducting landfill operations.
Id.
The
only specific contract identified by the State of Illinois is a lease agreement between the City of
Moths and CLC. That lease agreement is attached hereto as Exhibit B, and explicitly establishes
that CLC is the entity that conducts all landfill operations, rather than the City of Morris. The
Termaat
case relied on the fact that the independent contractor did not have a lease for the site as
an determinative element that established he was not conducting a waste disposal operation. In
the present case, the right to conduct a waste disposal operation was contractually conveyed to
CLC. At no time did the City of Moths supervise or direct the activities of CLC at the landfill
site. In the present case, the State is merely attempting to artificially extend the financial
assurance requirements to the City of Morris, but the law is clear that the City bears no
responsibility to post financial assurance where it does not conduct waste disposal operations.
The State also alleges that the City provided “non-compliant financial assurance”, and asserts
that the City failed to post compliant financial assurance when the Frontier bonds were
determined insufficient. In other words, the State is employing the “damned if you do and
damned if you don’t” argument. However, as explained above, an owner actually has no
requirement to post financial assurance, and if an owner voluntarily decides to post financial
assurance, because an operator is unable to unwilling to do so, that does not create a burden upon
the owner to forever from that point forward continue to post financial assurance. Again, the law
only imposes a requirement from posting financial assurance upon one who “conducts any
6
70468228v2 806289
disposal operation”. 35 Ill.Admin.Code 811.700(f). The posting of financial assurance for
closure/post-closure care of a landfill is not the conducting of a disposal operation. Obviously,
under the plain meaning of these terms, only a party who is on site physically accepting waste at
a landfill, developing cells for the disposal of that waste, and overseeing and supervising those
activities is conducting a waste disposal operation. A municipality (or even an investor) who is
merely agreeing to accommodate in part the financial assurance needs of an operator is not
conducting a waste disposal operation under the plain meaning ofthose terms.
Third, the State next asserts that the City has acquired financial benefit from the landfill
operation, and that somehow that means the City is conducting a waste disposal operation.
Again, the State provides absolutely no legal basis for its assertion that receiving financial
benefit from a landfill operation magically converts the owner of a site into an operator. Indeed,
the State itself acquires income and real estate taxes as a result of the landfill operations; does
that make the State an operator of the landfill? Likewise, any independent contractor that
performs services for the landfill receives financial benefit, and the law is clear that those
independent contractors are not responsible for posting closure/post-closure financial assurances.
Termaat.
Almost every new landfill that is sited in Illinois involves a host fee agreement with
the hosting government. Even when a county or city does not own the land, an agreement is
entered into with the operator establishing that certain tipping fees will be paid to the host
community which will be used to offset the economic impacts of hosting a landfill site. This
host fee arrangement does not magically result in a host community being deemed to be
conducting waste disposal operations, thereby subjecting the host community to the obligation to
post financial assurances. If such were the case, no local unit of government would ever vote in
favor of siting a landfill, as doing so would subject that local unit of government to the
7
70468228v2 806289
possibility of having to post financial assurance for the closure and post-closure care of the
landfill. Such an argument by the State is simply disingenuous and ridiculous.
In a last ditch effort to argue that the City of Morris is somehow conducting landfill
operations, the State points out that in
Berger,
the individual that was determined to be the
operator was in fact listed on the permits as an operator, and that the permits themselves were not
transferred to the owner of the landfill. Once again, the existence of one’s name on a permit is
not dispositive ofwhether that entity is actually conducting landfill operations. Furthermore, the
Berger
case was offered for the purpose of showing that the owner of a landfill site is not
automatically deemed to be an operator of the landfill, and, rather, there must be a determination
by the Pollution Control Board as to whether one is actually conducting a landfill operation
before imposing the financial assurance requirements. The State of Illinois apparently wants to
avoid this determination, and morph the law to establish that owners and operators both must
post financial assurance, regardless of who is actually conducting the operation. Fortunately,
that is not the status of the law, and it is simply undeniable that the City of Moths is not, and has
not, conducted landfill operations at this site since April 9, 1997, and, therefore, is not required
to post financial assurance for the site, and is entitled to judgment as a matter oflaw.
II.
Enforcing the Act as Written Does Not Result in Absurd Results.
As is often argued by a party who is attempting to avoid the plain language of a statute,
the State of Illinois argues that enforcement of the statute will lead to absurd results. The State
argues that “clearly, the provisions of subpart (g) must be interpreted to require owners and
operators to provide financial assurance, although either party may arrange it.”
(State’s
Response Brief, pg. 12). However, the plain language of the financial assurance regulations
repeatedly provide “an owner ~ operator” shall post financial assurance. 811.700, 706, et seq.
8
10468228v2 806289
If the legislature meant to require owners and operators to post financial assurance it woulsi have
so provided. It is improper for the State to invite the Pollution Control Board to supplant its will
over that ofthe Legislature and, in essence, engage in agency-made legislation. Rather,theplain
language ofthe statute or regulation must be followed.
The State also argues that employing the plain language of these standards would result
in only the personlparty who is physically involved in disposing of waste being subjected to
financial assurance responsibility. (State’s Response Brief, pg. 10). In the first instance, there is
nothing absurd or repugnant about requiring only the entity that is actually operating a landfill to
post financial assurance for closure and post-closure care, and the State has failed to point to any
regulation or case that states otherwise. Secondly, whether an owner who is not a unit of local
government would be subjected to the financial assurance requirements is simply not at issue in
this case, and should not and need not be decided at this time. The law is absolutely clear that a
unit oflocal government is exempt from the financial assurance requirements unless it conducted
landfill operations after April 9, 1997. 811.700(c), (f). The legislature clearly contemplated that
municipalities such as the City of Morris might have been listed as operators, or even conducted
landfill operations, before April 9, 1997, but as long as they did not conduct such operations after
that milestone date, the municipality will not be required to post financial assurance. Therefore,
the State’s alleged concern about inviting non-governmental property owners to set up shell
business entities to avoid the Board’s landfill management regulations is simply an effort to
divert the Board from the actual issues involved in this case. Furthermore, if such a shell
company were established, one could simply employ one or more of many theories of common
enterprise liability (i.e., piercing the corporate veil, alter ego, defacto merger, mere continuation,
9
70468228v2 806289
substantial continuation, etc.). In this particular case, CLC is obviously not the alter ego of the
City ofMoths.
Employing the plain language of 811.700(f) does not conflict with subpart (g) of the
regulations. Interestingly, the State cites 811.700(b) and 706 as somehow being in conflict with
700(f). However, even reviewing the language highlighted by the State establishes that these
subparts are certainly not in conflict, because the Act consistently provides that an owner or
operator shall post financial assurance, and at no time does it provide an owner and operator
shall post as the State argues was somehow actually intended by the legislature. The State
argues that because closure/post-closure financial assurance is mandatory, if the operator fails to
provide it, then the owner must. What the State refuses to recognize is that a failure to post
financial assurance by either the owner or operator would only results in a violation by the
operator of these financial requirements pursuant to the plain language of the statute. In other
words, the statutes and regulations clearly provide that financial assurances “shall” be posted,
and pursuant to the force and effect of the regulations in question, the State permits those
assurances to be posted by either the owner or operator. However, if an operator conducts a
landfill operation without having financial assurances posted, this constitutes a violation of the
standard by the operator, and not the owner. If indeed the State had required that both the owner
and operator post financial assurance, it could have easily provided for such in the language of
both the statute and the regulations in issue, It has not done so, and, as a matter of fact, the plain
language of these directives explicitly excludes municipalities from posting financial assurance
when these units oflocal government have not conducted waste disposal operations since April 9
of 1997. This Board need only enforce the plain language of the statute and regulations in
question to award summaryjudgment in favor of the City of Moths.
10
70468228v2 806289
III.
The City of Morris has Committed No Violations, Willful or Otherwise.
As explained above, the law is absolutely clear that the City of Moths is excluded from
posting financial assurance in this case. When the uncontroverted facts in this case are reviewed,
it is undeniable that at no time since April 9, 1997 has the City of Morris conducted landfill
operations at the site, and, therefore, the City of Moths is excluded from the financial assurance
requirements of the Act and regulations. At a minimum, the City of Moths has had much more
than a good faith basis for its assertion that it has been in complete compliance with the law and
regulations. Therefore, the City ofMorris has not committed “wilful” and repeated violations.
WHEREFORE, the City of Moths, prays that its Motion for Summary Judgment be
and the motion of the State of Illinois be denied.
Ptb\ttI&$tZ-
¶
,
2005
Respectfully Submitted,
On behalf of the CITY OF MORRIS
By: Hinshaw
granted
Dated:
HINSHAW & CULBERTSON LLP
100 Park Avenue
P.O. Box 1389
Rockford, IL 61105-1389
815-490-4900
This document utilized 100 recycled paper products
Charles F. Helsten
One ofits Attorneys
Rich?t Porter
One fits Attorneys
70468228v2 806289
AFFIDAVIT OF SERVICE
The undersigned, pursuant to the provisions of Section 1-109 of the Illinois Code ofCivil
Procedure, hereby under pe~ltyof perjury under the laws of the United States of America,
certifies that on November ~
,2005, she served a copy ofthe foregoing upon:
Mr. Christopher Grant
Assistant Attorney General
Environmental Bureau
188 W. Randolph St., 20th Fl.
Chicago, IL 60601
Scott Belt
Scott Belt and Associates, PC
105 E. Main Street, Suite 206
Moths, IL 60450
Clarrisa Grayson
Mark LaRose
LaRose & Bosco, Ltd.
200 N. LaSalle Street, Suite 2810
Chicago, IL 60601
Ms. Dorothy Guim, Clerk
Pollution Control Board
100W. Randolph, Suite 11-500
Chicago, IL 60601
BradleyHalloran
Hearing Officer
Pollution Control Board
100W. Randolph, Suite 11
Chicago, IL 60601
By depositing a copy thereof, enclosed in an envelope in the United States Mail at Rockford,
Illinois, proper postage prepaid, before the hour of 5:00 P.M., addressed as above.
HINSHAW & CULBERTSON LLP
100 Park Avenue
P.O. Box 1389
Rockford, IL 61105-1389
(815) 490-4900
7036563~vJ806289
11/08/2005 16 05 FAX 1 815 942 0216
CITY OF MORRIS
~002/005
BEFORE THE ILLINOLS POLLUTION CONTROL BOABD
PEOPLE OF THE STATE OF ILLINOIS
)
Cosn~
)
Vs.
coMMU1~ury
LANDFILL
COMPANY, JNC..)
an Illinois
coxporafion, and the
CITY OP
)
MORRIS,
an Illinois municipal corporation,
)
)
Respondents.
)
APFIDAVJI
STATE
OF
ILLINOIS
)
SS
•
Cbt)NrY OF WINNEBAGO
)
I. Mayor Richard Kupcñck. the undersigned being first duly swcnn on oath depose and
state as
fi)lloWs:
1.
I
am the Mayor
of the City of Moths, and have
been
the Mayor since May 1,
2001.
2.
I
am familiar with
the rca estate owned by the City of Monis, which is leasni to
COW
wunity Landfill Company, Inc. (CLC) to operate a landfill at that site.
3~
Prior to being elected Mayor, I was an Aidnan for the City of Morris since
4.
I &n also fanjiJiar with the complaint filed
by
the People of rho Stare ofIllinois
alleging that the City ofMorris is required to post financial assuranecs forsaid landfill
5.
At no time on or t
April 9, 1997, has the City of Mofria Conducted any
disposal operation at the landfill operated by Community landfill Company. inc.
6.
AteonorafterApHl9,1997,hastheCityofMouisftpreadwasteatthe
landfill. compacted waste, operated equipmad at the landfill pafbnned inspections of
the
site,
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03-191
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senycontibrthelandflll,paidthebjjlnoftbelandflflorjtsopaatorcLC,placed
cover ov~the lindfiJJ, constructed or developed any portion of
the landfill, or
otherwise acted as
the operator ofthe landfill
USa paltica as provided
by
law pursuant to Section
1-109 of the Code of Civil
Pmca&rv~the uudcmiguod certifies that
(tic statanents act forth in this inatrimierit are true awl
correct, accpt as to matters therein stated to be on inibymation and belief and as to such matters
the inidasigned certifies as aforesaid that he ‘verily believes the same to he true
DAThD:
J/-~-os
JONSHAW & CULBERTSON
LU’
100 Park Avajue
P.O.
Box
1389
Rndthn’d,1L61105-1389
815-490-4900
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SCOTT M BELT & ASSOC
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‘OFFICIAL SEAL’
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ILMY
Coinimigion
Cap. 11/17)2005
L454QLI4O~
p.pprodn
Mayor RichardKopczick
7D.SaP,i I~l,
•
EXHIBIT
LEASE AGREEMENT
Lease made this 1st day of July, 1982, by and between TUE
CITY OF MORRIS, ILLINOIS, A Municipal Corporation, hereinafter
referred to as “LESSOR”, and COMMUNITY LANDFILL CO., An Illinois
Corporation, of Joliet, Illinois, hereinafter referred to as
“LESSEE”.
WITNES SETH:
WHEREAS, Lessor presently owns a parcel of property in
Morris Township, Grundy County, Illinois, which is presently
licensed as a sanitary landfill; and
WHEREAS, Lessee is in the business of operating regional
pollution control facilities, more commonly known as sanitary
landfills; and
WHEREAS, Lessee desires to lease from Lessor those premises
hereinafter described, as a sanitary landfill; and
WHEREAS, Lessor and Lessee believe that it will be in
their mutual interest to enter into this Lease Agreement.
NOW, THEREFORE, in consideration of the promises hereinabove
set forth and the mutual covenants hereinafter contained, the
parties do hereby agree as follows:
SECTION I
The Lessor in consideration of the rent hereinafter required
1
to be paid by Lessee and of the agreements hereinafter contained,
does hereby lease to Lessee exclusively during the term hereof
for the’ sole purpose of operating
a regional pollution control
facility in accordance with and pursuant to all laws, rules and
regulations promulgated and adopted by all agencies of the
federal, state and county governments, including the Illinois
Environmental Protection Agency for a Class II landfill, that
real estate belonging to the Lessor and described on the attached
Exhibit A.
SECTION II
This Lease shall commence on the 1st day of July, 1982, and
shall terminate on the 30th day of June, 1999, or at such earlier
date as the demised premises have reached full capacity for the
collection of Permit II waste, whichever date is earlier;
subject, however, to Section
XVI hereof.
SECTION III
After the issuance of a Class
II operating
permit by the
Illinois Environmental Protection Agency, Lessee shall pay to the
Lessor, and the Lessor agrees to accept therefore for the
operation of such regional pollution control facility an annual
minimum royalty of Fifteen Thousand ($15,000.00) Dollars, the
first payment to be made upon Lessee receiving its operating
permit pursuant to Section VIII hereof, and thereaftor on or
2
P
each year of this Lease. Lessee forthwith agrees that Lessor
shall be entitled to a royalty in the amounts as follows:
A. For a period from July 1, 1982, to June 30, 1983,
the sum of $0.08 per cubic yard of compacted material
and $0.02667 per cubic yard of uncompacted material;
B. For a period from July 1, 1983, to June 30, 1984,
the sum of $O.0824 per cubic yard of couwacted material
and $0.02747 per cubic yard of uncompacted material;
C. For a period from July 1, 1984, to June 30, 1985,
the sum of $0.0849 per cubic yard of compacted material
and $0.02829 per cubic yard of uncompacted material;
D. For a period from July 1, 1985, to June 30, 1986,
the sum of $0.0874 per cubic yard of compacted material
and $0.02914 per cubic yard of uncompacted material;
E. For a period from July 1, 1986, to June 30, 1987,
ri
‘j
1,~L
andthe $O.03001sum
of $O.0900per
cubicper
cubicyard
ofyarduncompactedof
compactedmaterial;material
F. For a period from July 1, 1987, to June 30, 1988,
the sum of $0.0927 per cubic yard of compacted material
and $0.03091 per cubic yard of uncompacted material.
Thereafter Lessor shall be entitled to receive as a royalty
per cubic yard of compacted material and per cubic yard of
uncompacted material an amount equal to the royalty paid for the
period referred to in Paragraph F above multiplied by the
following fraction in effect at the time the material is deposited.
1. For Compacted Material:
Lessee’s dumping charge per cubic yard of compacted
material charged to its customers at the time the
yardage is deposited divided by Lessee’s weighted
average dumping charge per cubic yard of compacted
material for the period set forth in Subparagraph F
3
~bove.
2.
For Uncompacted Material:
Lessee’s dumping charge per cubic yard of uncompacted
material charged to its customers at the time the
yardage is deposited divided by Lessee’s weighted
average dumping charge per cubic yard of uncompacted
material for the period set forth in Subparagraph F
above.
The denominator in the above fractions shall remain the same at
all times but the numerator shall change whenever the dumping
charge changes.
Lessee shall be entitled to receive credit
against the minimum annual royalty payment for yardage deposted
until the yardage of material collected during any year exceeds
the annual minimum royalty payment. Thereafter, any royalty
amounts in excess of the minimum annual royalty shall be paid to
Lessor within ten (10) days after the end of the first month and
for each successive month thereafter that such yardage amounts
deposited exceed the minimum annual royalty.
SECTION IV
During the term of this Lease, Lessee agrees to keep
accurate books, records and invoices on all yardage of refuse
deposited at the landfill site hereinbefore described.
Within
forty—five (45) days of the end of each annual term hereof,
Lessee shall submit to Lessor a statement tobe certified
as
correct, which sets forth the yardage of refuse authorized to be
deposited under Illinois Environmental Protection Agency Permit
4
II upon Lessor’s premises. Lessor may once in any calendar year
cause an audit of the business of Lessee to be made by a
certified public accountant of Lessor’s own selection, and if the
statements of yardage previously made by Lessee to Lessor shall
be found to be less than the amount of Lessee’s yardage as shown
by such audit, Lessee shall immediately pay the cost of such
audit, as well as the additional compensation therein shown to be
payable by Lessee to Lessor; otherwise, the cost of such audit
shall be paid by Lessor.
SECTION V
Lessee agrees to use consecutively numbered tickets for all
dumping on the premises during the term of this Lease. Lessee
further agrees to submit copies of all dumping tickets to Lessor
monthly and to provide Lessor with access to its records during
normal business hours.
SECTION VI
Lessee shall, with the prior written consent of Lessor, have
the right, at its own expense, to construct buildings upon the
premises for its own use at any time during the lease term and to
make alterations to such buildings.
Lessor assumes no liability
of any kind for such construction or alterations to any
contractor or subcontractor or laborer or materialmen. Such
buildings constructed on the premises shall become a part of the
5
premises and shall belong to Lessor without compensation to
of this Lease.
alterations and additions may be made under the following
conditions:
the total market value of the premises shall not
reason of any such construction, alteration or
B.
That the work shall be done in a good and workmanlike
manner.
C. That all such construction, additions and alterations
shal
completed in
requ
thereto.
construction,
accordance wit
building codes
general public
Lessee as their
Lessee
at all
connection with
E. Lessee
be placed upon
thereon during
such lien, Lessee
Lessee at the expiration
Such construction,
A. That
be lessened by
addition.
1 be expeditiously
irements applicable
D. That all work (lone
compliance with all legal
in connection with such
additions or alterations shall be done in
h the requirements of all fire prevention and
as may be applicable to the city of Morris and
liability insurance for the benefit of Lessor and
interests may appear, and shall be maintained by
times when any such work is in progress in
such construction, additions or alterations.
will not permit any mechanic’s liens or liens to
the premises or any building or improvement
the term hereof, and in case of the filing of any
will promptly pay the same. If default in
6
payment thereof shall continue for thirty (30) days after written
notice thereof from Lessor to the Lessee, the Lessor shall have
the right and privilege at Lessor’s option of paying the same or
any portion thereof with out inquiry as to the validity thereof,
and any amount so paid, including expenses and interest, shall be
so much additional indebtedness hereunder due from Lessee to
Lessor and shall be repayed to Lessor immediately on rendition of
a bill therefore.
SECTION VII
It is the understanding of the parties hereto that Lessee
shall keep the lease premises insured as folLows:
A. All insurance provided for in this Paragraph VII shall
be procured by Lessee at its sole cost and expense under valid
and enforceable standard form policies issued by insurance
companies licensed to do business in the State of Illinois.
B. Lessee shall carry fire and extended coverage insurance
on any buildings that it may construct upon the premises during
the entire term of this Lease in an
amount equal to at least
eighty (80)
percent of the valuation of the buildings, land and
all additions or improvements made thereon by either party,
written by a reliable insurance company or companies authorized
to do business in the State of Illinois. The policy shall be
written in the names of and for the benc fit of Lessor and Lessee
as their respective interests may appear.
7
C.
Lessee agrees to maintain in effect throughout the term
of this Lease public liability
insurance covering the demised
premises and appurtenances utilized by it in the amount of Five
Hundred Thousand ($500,000.00) Dollars for injury to or death of
any one person, One Million ($1,000,000.00) Dollars for injury to
or death of any number of persons in one occurrence, property
liability
insurance
in the amount of One Hundred Thousand
($100,000.00) Dollars, and an umbrella policy for liability
for
injury to person or property in the amount of $2,000,000.00.
Such insurance shall be the standard form liability
policy and
shall specifically insure Lessee against all liability assumed
hereunder, as well as liability imposed by law, and shall insure
both Lessor and Lessee.
The insurance companies shall agree by
endorsement on the policy or policies issued by it or by
independent instruments furnished to the Lessor that it will give
to the Lessor fifteen
(15)
days written notice before the policy
or policies in question shall be altered or canceled.
Premiums
paid by Lessee on such liability insurance obtained by Lessee
shall not be considered as additional rental under this Lease.
D.
Lessee
agrees to obtain workman’s compensation
insurance which shall provide coverage for all of its employees
who work upon the demised premises in an amount of not less than
the statutory requirements. Lessee agrees to submit to Lessor a
certificate of insurance evidencing the fact that the Lessee has
8
secured s~uch insurance. The insurance company shall agree to
furnish to Lessor by endorsement on the policy or policies issued
by it or by independent instruments that it will give to Lessor
written notice before policy or policies in question shall be
altered
or canceled.
Premiums paid by Lessee shall not be
considered as an additional rental under this Lease.
E. Insurance claims by reason of damage or destruction to
any portion of the leased premises shall be adjusted by Lessee
and Lessor.
SECTION VIII
The parties hereto do hereby understand and agree that the
use of the premises as a Class II permit regional pollution
control facility requires the issuance of two permits by the
Illinois Environmental Protection Agency. The first permit is
referred to as a development permit. This permit allows the
applicant to develop the demised premises in accordance with the
rules and regulations of the agency in order to determine
ultimately whether such site is suitable for use as a sanitary
landfill. If the Environmental Protection Agency determines that
such site is suitable, it will thereupon issue to the development
permitee an Operating Permit. Lessor agrees to cooperate with
Lessee, at no expense to Lessor, for the purpose of renewing the
permits previously issued to Lessor. If it is required by the
9
Illinois Environmental Protection Agency, Lessor agrees to
execute all applications and other documents that may be required
to secure such permits.
In addition, Lessor further agrees to
execute all applications and other documentation that may be
required by the County of Grundy toapprove such site as a
regional pollution control facility.
Lessor and Lessee do hereby
agree that Lessee’s obligation for the payment of any rental
under the terms of this Lease is contingent upon Lessee receiving
an Operating Permit for the use of this facility as a Class II
sanitary landfill under and pursuant to the terms, provisions,
rules and regulations of the Illinois Environmental Protection
Agency. In the event Lessee is unable to obtain such operating
permit within ninety (90) days of the date of this Lease
Agreement, such Agreement shall become null and void.
SECTION IX
Lessor further agrees to co—operate
with Lessee in amending
the Operating Permit previously issued to Lessor to permit above—
grade fill on the site to a maximum height of forty—five (45)
feet, rather than the present twenty—five (25) feet.
SECTION X
Lessee has examined and knows the condition of the premises
and has received
the same in good order and repair
and
acknowledges that no representations as to the condition and the
10
repair thereof have been
made
by Lessor, or their agents prior to
the Illinois Environmental Protection Agency.
Lessor and
herein shall be
may have in the
Lessee, and that
ironmental
keep said
and from
not make
ssor may,
and such
from and
SECTION XI
Lessee do hereby agree that nothing contained
interpreted to convey any interest that Lessor
mineral rights upon the demised premises to
Lessor shall have full and unrestricted right to
or at the execution of this Lease that are not herein expressed.
LessorS shall not be obligated to incur any expenses for repairing
any improvements
upon said demised premises or connected
therewith, and Lessee at its own expense will keep the demised
premises
including all appurtenances
in good repair and in
compliance with all local rules, general regulations,
laws,
statutes and ordinances of all federal, state and county
government having jurisdiction
over the demised premises,
including all rules a
Protection Agency.
nd regulation
5
of the Illinois Env
Lessee will, as far as possible,
improvements from deterioration
due to ordinary wear
falling
temporarily
out of repair.
If Lessee does
repairs as required hereto promptly and adequately Le
but need not. make, such repairs and the cost thereof,
costs shall be so much additional rental immediately due
payable hy Lessee to Lessor. At the termination of this Lease,
Lessee will cover th
e landfill site
with materials approved by
11
the use arid benefit of such mineral rights; provided that during
the term of this Lease any methane gas that may be generated as
a result of the operation of the sanitary landfill shall be the
sole: and exclusive property of the Lessee.
SECTION XII
Lessee will pay in addition to the rent above specified all
water rents, sewerage charges, gas and electric light and power
bills taxes, levied or charged on the premises, for and during
the time for which this Lease is granted, and in case water rents
and bills for gas, electric light and power shall not be paid
when due, Lessor shall have the right to pay the same, which
amount so paid together with any sums paid by Lessor to keep the
premises in a clean and healthy condition as above specified, are
declared so much additional rent and payable with the installment
of rent next due thereafter;
provided that in no event shall
Lessor be obligated for any water rents, sewerage charges, gas
and electric light and power bills that may be taxed or levied or
charged.
SECTION XIII
All operations shall be conducted in a safe and prudent
manner, and it is agreed that should any dispute arise between
Lessor and Lessee regarding the conduct of operations in a safe
and prudent manner, such dispute shall be referred to the
12
Illinois
Environmental
Protection
Agency for decision,
such
decision to be final and binding on both parties.
In addition,
Lessee will comply with all laws, rules and regulations
of any
governmental authority affecting Lessee’s operations in the
leased premises,
and will on request,
furnish Lessor with
supporting evidence of such compliance.
SECTION XIV
Lessor acknowledges
that Lessee
landfill
on the premises six (6) days
hours per day, or such additional
days and hours
determines
necessary.
Lessor agrees not to adopt
rules,
regulations
or other limitations
affecting
Lessee to operate the landfill less than six (6)
fourteen (14) hours per day.
Lessor acknowledges that it is Lessee’s intention to attempt
to acquire an
additional parcel of real estate immediately
adjacent to, and southeast of, the leased premises and consisting
of approximately
eighteen acres. If Lessee acquires said real
estate,
Lessee agrees to convey it to Lessor for a nominal
consideration
of Ten Dollars.
Said parcel shall become part of
the demised premises upon conveyance to Lessor and shall be
subject
to all of the terms and conditions
of this Lease
intends to operate
the
per week, fourteen
(14)
as the Lessee
any ordinances,
the ability of
days per week,
SECTION XV
13
Agreement.
SECTION XVI
Lessee agrees to accept all qualified
waste collected
from
residents and commercial establishments of Lessor for deposit in
the landfill operated on the premises for a period of fourteen
(14) years from the date of this Agreement.
Lessee shall be
obligated to accept said waste regardless of the entity
collecting
the waste and delivering it to the landfill.
This
waste shall be received by Lessee at the same charges as
applicable
to other similar waste deposited in the landfill,
which charges shall not be excessive.
Lessee agrees the City of Morris engineer shall monitor the
use of the landfill by Lessee. In the event the City engineer
shall determine that the capacity of the landfill is being
utilized at a rate which could affect the ability of Lessee to
accept Class II waste from the City of Morris for the fourteen
year period above required, Lessor
shall so notify Lessee and
Lessee shall affirmatively show to Lessor its policy for future
utilization
of the landfill so as to establish its ability to
satisfy Lessee’s obligation to accept Class II waste from the
City of Morris for the fourteen year period above required.
SECTION XVII
Each of the following events shall constitute a default or
14
breach of ~his Lease by Lessee:
A.
If Lessee or any successor assignee of Lessee while in
possession
shall file a petition
in bankruptcy or insolvency or
for ieorganization
under any bankruptcy act or shall voluntarily
take advantage of any such act by answer or otherwise.
B.
If involuntary proceedings under any bankruptcy law or
insolvency
act shall be instituted
against
Lessee, or if a
receiver or trustee shall b9 appointed for all or substantially
all of the property ofLessee and such proceedings shall not be
dismissed
or the receivership
or trusteeship
vacated within
thirty (30) days after the institution
or appointment.
C.
If Lessee shall
fail
to pay Lessor any rent or
additional rent when the rent shall become due and shall not make
the payment within thirty
(30) days after notice thereof by
Lessor to Lessee.
D. If Lessee shall faiL to perform or comply with any of
the conditions of this Lease and if the non—performnce shall
continue for a period of thirty (30) days after notice thereof by
Lessor to Lessee, or if the performance cannot be reasonably had
within tite thirty (30) day period and Lessee shall not in good
faith have commenced performance within the thirty (30) day
period and shall not diligently
proceed to completion
of
performance.
E.
If Lessee shall vacate or abandon the lease premises.
15
F. .If Lessee fails to obtain an operating permit for a
Class II landfill from the Illinois Environmental Protection
Agency.
SECTION XVIII
In the event of any default hereunder as set forth in
paragraph XVII, the rights of Lessor shall be as follows:
A. Lessor shall have the right to cancel and terminate
this Lease as well as all of the right, title and interest of
Lessee hereunder by giving to Lessee not less than five (5) days
notice of cancellation and termination. On expiration of the
time fixed in the notice this Lease and the right title and
interest of Lessee hereunder shall terminate in the same manner
and with the same force and effect, except as to Lessee’s
liability as if the date fixed in the notice of cancellation and
termination were the end of the term herein originally
determined.
B.
Lessor may reenter the premises immediately and remove
the property and personnel of Lessee and store the property in a
public warehouse or a place selected by Lessor at the expense of
Lessee. After reentry Lessor may terminate the Lease in giving
five (5) days written notice of termination to Lessee. Without
the notice, reentry will not terminate the Lease. On termination
Lessor may recover from Lessee all damages proximately resulting
16
from the breach, including the cost of recovering the premises,
which sum shall be immediately due Lessor from Lessee.
C. Lessee shall be liable for all expenses of the
reletting,
and for all costs that may be incurred in properly
covering the landfill site and other events of closure according
to the rules and regulations of the Illinois Environmental
Protection Agency; provided that in the event Lessor relets the
site to another party for the purpose of continuing a sanitary
landfill operation, Lessee shall not be responsible for the cost
of the closure of the landfill.
SECTION XIX
Lessee will allow Lessor free access to the premises for the
purpose of examining or exhibiting the same or to make any
needful repairs or alterations thereof which Lessor may see fit
to make and will allow to have placed upon the premises at all
times ntoices of “For Sale” and “To Rent” and will not interfere
with the same.
SECTION XX
The parties acknowledge that the drainage of surface water
for the premises leased hereunder is to the east through ditches
constructed by the Lessor around property owned by it which was
formerly used for the City of Morris Landfill.
Lessee agrees to maintain said drainage ditches as they now
17
exist at its own expense during the term of this Lease.
Lessor hereby grants to Lessee an easement for drainage
purpose’s and for the purpose of maintaining said ditches across
that real estate described in the attached Exhibit B.
XXI.
Lessee covenants and agrees that it will protect and save
and keep the Lessor forever harmless and indemnified against and
from any penalty or damages
!or
charges imposed for any violation
of any laws or ordinanâes, whether occasioned by the neglect of
Lessee or those holding under Lessee and that Lessee will at all
times protect, indemnify and save and keep harmless the Lessor
against and from any and all loss, costs, damage or expenses,
arising out of or from any accident or other occurrence on or
about the premises, causing injury to any person or property
whomsoever or whatsoever and will protect, indemnify and save and
keep harmless the Lessor against and from any and all claims and
against and from any and all loss, cost, damage or expense
arising out of any failure of Lessee in any respect to comply
with and perform all the requirements and provisions hereof.
SECTION XXII
Lessee will pay and discharge all reasonable costs,
attorneys’ fees and expenses that may be incurred by Lessor, in
enforcing the convenants
and agreements of this Lease and Lessor
18
will pay and discharge all reasonable costs, attorneys’ fees and
expenses that may be incurred by Lessee in enforcing the
covenants and agreements of this Lease,
SECTION XXIII
Lessee shall not sublease any part of the demised premises,
or assign this Lease, without the prior written consent of
Lessor, their heirs or assigns and if Lessee shall violate this
provision, it shall be lawful for Lessor, their heirs or assigns
to reenter the premises hereby leased or any part thereof and to
repossess the premises, anything herein contained to the contrary
notwithstanding.
SECTION XXIV
All the covenants and conditions and obligations herein
contained shall be binding upon and enure to the benefit of the
respective heirs and successors and assigns of the parties hereto
to the same extent as if each such heir, successor and assign
were in each case named as a party to this Lease. This Lease may
not be changed, modified or discharged except by writing signed
by Lessor and Lessee.
SECTION XXV
In the event permits to operate Class II sanitary landfills
are suspended, revoked or canceled because of substantial changes
of any governmental law, rule, or policy, this Lease shall become
19
null and void and Lessee shall no longer be obligated to Lessor
except for any rents that may be due and for the proper closure
of the’ landfill site.
SECTION XXVI
Lessor agrees to do everything within its power to maintain
the tax exempt status of the real estate leased hereunder. In
the event the lease hold interest of Lessee or any part of the
real estate is assessed for real estate tax purposes, Lessee
agrees to pay all real estate taxes resulting from said
assessment. Lessee shall pay for all legal expenses and costs
incurred by Lessor in maintaining the tax exempt status of the
real estate leased hereunder.
SECTION XXVII
All notices required or permitted hereunder shall be in
writing and may be given by certified mail, first class mail, or
during regular business hours by delivery by messenger or by
delivering in person to the person named below until further
notice to the contrary is given by any one of the parties hereto:
LESSOR:
LESSEE:
City of Morris
Community Landfill Company
Morris City Hall
25 North Ottawa Street
Morris, IL 60450
Joliet, IL
All notices by mail shall be deemed delivered when deposited with
the United States Postal Service.
20
SECTION XXVIII
For the purposes of this Lease Agreement, the term “Class II
Landfill” shall mean a sanitary landfill operated in accordance
with the Illinois Environmental Protection Act and all
regulations issued thereunder for the sole purpose of accepting
“municipal waste” as that term is defined in the Illinois
Environmental Protection Act,
SECTION XXVIX
To guarantee the fulfillment of all terms and conditions of
this Lease Agreement, Lessee agrees to deposit with Lessor within
ten (10) days after the execution of this Lease Agreement a
letter of credit issued by a financial institution licensed by
the State of Illinois or by the United States Government in the
amount of $50,000.00. This letter of credit shall remain in
effect the entire term of this Lease Agreement and shall be
conditioned on the Lessee duly performing all conditions and
obligations under this Lease Agreement. Said letter of credit
shall provide in the event of a default by Lessee, which default
shall remain uncured for thirty (30) days after written notice to
Lessee, that Lessor shall be entitled to immediately draw against
said letter of credit in the amount of the default or the sum of
$50,000.00, whichever is less.
21
SECTION
XXX
Lessee agrees not to transfer a controlling interest of the
stock pf Lessee without the prior written consent of Lessor,
which consent shall not be reasonably withheld. It is the intent
of this provision that Lessor be aware of the principals of
Lessee and have an opportunity to object to a transfer of
controlling interest if Lessor believes it would adversely affect
it under this Lease Agreement.
The parties agree that this provision shall not be
applicable to a public offering of stock by Lessee or to the
merger of Lessee into a publicly held corporation.
SECTION XXXI
This Lease Agreement will be governed both as to
interpretation and performance under the Laws of the State of
Illinois,
IN WITNESS WHEREOF, the Lessor and the Lessee by and through
its President and Corporate Secretary have executed this Lease
Agreement on the day and year first above written.
22
CI OF MORRIS
ATTEST:
COMMUNITY LANDFILL COMPANY, An
Illinois orporatio
BY:
J2
~2tc.nr~
Its President
23
GUARANTEE OF ROYALTY
In
consideration of the execution of this Lease Agreement by
Lessor, the undersigned hereby personally guarantee the royalty
payments to be paid by Lessee to Lessor as required by Section
III of this Leaso~Ageement.
DATED:
/~
/cIk ____-
U
________
24
LEXAL DESCRIPTION
LM’ThFILL, WEST SIDE
Commencing at the northeast corner of Section 3, Township 33 North,
Range 7 East
of the Third Principal Meridian, said point being the POINT OF
BEZINNING;
thence due South along the east line of said Section
3
for a
dist~ñce of 156.00 feet; thence South
148°
00’
14)~”
West for a distance of
1777.00 feet; thence South 89° 314’ 10” West for a distance of 1016.00 feet
to a point which falls on the east right—of—way line of the Chicago, Rock
Thland
and
Pacific Railroad spur line; thence North 00°
39’
20” West along
said east right—of—way line for a distance of 14514.20 feet; thence North 05°
38’
00” East along said east right—of—way line for a distance of 100.00 feet;
thence No’~th18°014’
00”
East along said east right—of—way line for a distance
of 100.00 feet; thence North 27°148’ 00” East for a distance of 50.00 feet
to a point which falls on the squtherly right—of—way line of the main tracks
of the Chicago, Rnck Island
and Pacific Railroad; thence North 50° 141’
00”
East along said southerly right—of—way line for a distance of 369.27 feet;
thence due South along said southerly right—of—way line for a distance of
38.75 feet; thence North 500 iiJ.~ 00” East along said southerly right—of—way
line for a distance of 1813.00 reet; thence South 39°16’ 00” East along said
southerly right—of—way line for a distanr.e of 70.00 feet; thence North 50°14)4’
00” East for a distance of 700.00 feet to a point which falls on the east
line of Section 3I~,Township 3L North, Range 7 East of the Third Principal
Meridian; thence due South along said east line for a distance of 1069.90 feet
to the point of beginning, containing 614.03 acres, more or less, all located
in the Northeast Quarter (NF*) of Section Three (3) Township Thirty—three (33)
North, Range Seven (7) East and the Southeast Quarter (54) of Sectin Thirty—
four (3)4), Township Thirty—four (3)4) North, Range Seven (7) East of the Third
Principal Meridian, City of Morris, County of Grundy, and State of Illinois.
June 29, 1982
EXHIBIT A
ADDENDUM TO LEASE AGREEMENT
THIS ADDENDUM entered into this
____
day of July, 1982,
by and between THE CITY OF MORRIS, ILLINOIS, A Municipal
Corporation, hereinafter
referred to as “Lessor”, and COMMU-
NITY LANDFILL CO., An Illinois Corporation, of Joliet,
Illinois, hereinafter referred to as “Lessee”.
WITNESSETH:
WHEREAS, Lessor and Lessee have negotiated a Lease
Agreement for premises to be operated by Lessee as a Sanitary
Landfill; and
WHEREAS, the parties hereto, in consideration of enter-
ing into said Lease Agreement and covenants contained herein,
desire to add the following provisions to said Lease Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED as follows:
1. ESTABLISHMENT OF CONTINGENCY FUND. Lessor has
indicated its intention of establishing a contingency fund
by setting aside $5,000. of the annual minimum royalty
required by Section III of the Lease Agreement, which contingency
fund would be used solely to satisfy contingent liabilities
resulting from the operation of a Sanitary Landfill on the
leased premises by Lessee or, if not necessary for said
purpose, to be used to improve the leased premises at the
termination of the Lease Agreement for recreational uses
by residents of the City of Morris.
2. CONTRIBUTIONS TO FUND BY LESSEE. In the event
Lessor establishes a contingency fund as referred to in
4.
Paragraph 1 above, within 120 days from the date of this
Addendum to Lease Agreement, by adopting any and all necessary
ordinances or resolutions;, and in the further event Lessor
makes annual contributions to said fund as referred to in
Paragraph 1 above, Lessee hereby agrees to contribute to
said fund an amount equal to 1/2 of the contribution by
Lessor up to a maximum contribution by Lessee of $2,500. in
any 12-month period. Payments by Lessee shall be made within
30 days after being advised by Lessor that Lessor has made its
annual contribution. Lessee agrees that this contribution
shall be over and above any sums required to be paid by it
under the Lease Agreement.
3. TERM. This Addendum shall remain in full force and
effect during the term of the Lease Agreement.
4. EFFECT OF ADDENDUM. This Addendum shall be binding
upon and inure to the benefit of the parties hereto, their
successors and assigns.
IN WITNESS WHEREOF, The Lessor and the Lessee by and
through its President and Secretary have executed this
Addendum to Lease Agreement on the day and year first above
written.
ATTEST
F MORRIS
ary
Its President
n
