After Recording Return to: Cascadia State Infrastructure Authority 1100 Jefferson Avenue SE, Suite 400 Olympia, WA 98501
Attn: General Counsel
Recording Requested in the Office of the Whatcom County Auditor Document Title: Permanent Easement Agreement Grantor: Veldkamp Family Holdings LLC Grantee: Cascadia State Infrastructure Authority Legal Description: See Exhibits A-1 and A-2 Tax Parcel Nos.: 380219-401200; 380219-401201 Reference Nos. of Related Documents: N/A
PERMANENT EASEMENT AGREEMENT
Pump Station No. 1 and Pump Station No. 2 Lower Nooksack Pump Station Network
CSIA Capital Project Number CP-2025-NPS-004 Calderwood & Harkness LLP Matter No. 1030-00003
This Permanent Easement Agreement (this "Agreement") is entered into as of the _ day of ___, 2025 (the "Effective Date"), by and between:
VELDKAMP FAMILY HOLDINGS LLC, a Washington limited liability company, with its registered agent address at 2240 Meridian Street, Bellingham, WA 98225 ("Grantor");
and
CASCADIA STATE INFRASTRUCTURE AUTHORITY, a Washington State governmental instrumentality created by Chapter 43.99N RCW, with headquarters at 1100 Jefferson Avenue SE, Suite 400, Olympia, WA 98501 ("Grantee" or "CSIA").
Grantor and Grantee are sometimes referred to herein individually as a "Party" and collectively as the "Parties."
RECITALS
WHEREAS:
A. Identification of Grantor. Grantor is Veldkamp Family Holdings LLC, a Washington limited liability company duly organized and existing under the laws of the State of Washington, with its registered agent address at 2240 Meridian Street, Bellingham, WA 98225. The Managing Member of Grantor is Hendrik "Hank" Veldkamp. The other members of Grantor are Anneke Veldkamp-Ross and Willem Veldkamp. Grantor is the owner of approximately one hundred eighty-seven (187) acres of agricultural land situated along River Road, Whatcom County, Washington, including without limitation the following tax parcels, which are the subject of this Agreement:
(i) Whatcom County Tax Parcel No. 380219-401200 (the site of Pump Station No. 1, hereinafter "PS-1"); and
(ii) Whatcom County Tax Parcel No. 380219-401201 (the site of Pump Station No. 2, hereinafter "PS-2").
B. Identification of Grantee. Grantee is the Cascadia State Infrastructure Authority, a Washington State governmental instrumentality created pursuant to Chapter 43.99N of the Revised Code of Washington, with its principal offices located at 1100 Jefferson Avenue SE, Suite 400, Olympia, WA 98501. The Executive Director of CSIA is Martin R. Calloway, and the General Counsel is Priya Shankar-Wells. CSIA is authorized by statute to acquire, construct, operate, and maintain public infrastructure projects for the benefit of the citizens of the State of Washington, including projects related to flood resilience, stormwater management, and wastewater conveyance.
C. Project Description. Grantee is developing the Regional Flood Resilience and Stormwater Management Program — Lower Nooksack Pump Station Network (the "Project"). The Project consists of four (4) pump stations to be constructed along the Lower Nooksack River corridor in Whatcom County, Washington, together with approximately six and two-tenths (6.2) miles of twenty-four-inch (24-inch) and thirty-six-inch (36-inch) high-density polyethylene ("HDPE") force-main pipeline connecting all four stations to the existing Nooksack Regional Wastewater Treatment Plant outfall. The total estimated value of the Project is Forty-Eight Million Dollars ($48,000,000). The Project is funded through a combination of (i) a Washington State Capital Appropriation in the amount of Thirty-One Million Two Hundred Thousand Dollars ($31,200,000), authorized by Senate Bill 5140, 2025 Regular Session, and (ii) CSIA Series 2025A Revenue Bonds in the amount of Sixteen Million Eight Hundred Thousand Dollars ($16,800,000), underwritten by Harborstone Capital Markets LLC. The Project is critical to public health, safety, and welfare as it is designed to address recurring flooding and stormwater management deficiencies in the Lower Nooksack River corridor and to protect agricultural lands and rural communities from flood damage.
D. Need for Easements. The Project requires permanent easements on portions of Grantor's Property for the construction, operation, maintenance, repair, replacement, and reconstruction of Pump Station No. 1 ("PS-1") and Pump Station No. 2 ("PS-2"), together with all associated facilities, equipment, piping, utilities, access roads, and appurtenances. PS-1 is to be located on Grantor's property at the intersection of River Road and Slater Road, Whatcom County, Washington, on Parcel No. 380219-401200. PS-2 is to be located on Grantor's property along River Road, approximately six-tenths (0.6) of a mile north of Ten Mile Road, Whatcom County, Washington, on Parcel No. 380219-401201. The easement areas described herein have been identified through engineering analysis and survey as the minimum areas necessary to accommodate the pump stations and associated facilities and to provide adequate operational clearance and maintenance access.
E. Authority. Grantee possesses the authority to acquire property interests by condemnation pursuant to Chapter 43.99N RCW and the general condemnation statutes of the State of Washington. Notwithstanding such authority, Grantor and Grantee have negotiated this Agreement in lieu of the exercise of condemnation authority, in a spirit of cooperation and mutual respect for the public interest and for Grantor's property rights. Grantee has made a good-faith offer to Grantor in compliance with the requirements of RCW 8.25, the Uniform Condemnation Procedures Act, including without limitation the requirements for appraisal, written offer, and negotiation in good faith prior to the commencement of condemnation proceedings.
F. Appraisal. The fair market value of the permanent easements to be granted hereunder has been determined by an independent appraisal prepared by Jocelyn Trueblood, MAI, of Northwind Valuation Group LLC, dated March 14, 2025 (the "Appraisal"). The Appraisal was prepared in accordance with the Uniform Standards of Professional Appraisal Practice ("USPAP") and, consistent with CSIA best practices for publicly funded acquisitions, the Uniform Appraisal Standards for Federal Land Acquisitions (commonly known as the "Yellow Book") methodology. The Appraisal concluded that the total fair market value of the easements is Six Hundred Fifteen Thousand Dollars ($615,000), allocated between the two easement areas as set forth in Article 4 and Exhibit C of this Agreement.
G. Legal Descriptions and Survey. Legal descriptions and easement plats for the PS-1 Easement Area and the PS-2 Easement Area have been prepared by Karen Whitfield, PLS, a licensed professional land surveyor in the State of Washington, of Ironclad Surveying & Land Services LLC, located at 4850 Cordata Parkway, Suite 110, Bellingham, WA 98226. Such legal descriptions and plats are attached hereto and incorporated herein by this reference as Exhibit A-1 (Legal Description of PS-1 Easement Area), Exhibit A-2 (Legal Description of PS-2 Easement Area), Exhibit B-1 (Easement Plat — PS-1 Easement Area), and Exhibit B-2 (Easement Plat — PS-2 Easement Area).
H. Title. A title examination has been performed by Cascade Basin Title Company (Title Officer: Diane Ashworth), located at 119 East Magnolia Street, Bellingham, WA 98225, confirming Grantor's fee simple ownership of the subject parcels and identifying all encumbrances, easements, and restrictions of record affecting the parcels.
NOW, THEREFORE, in consideration of the Compensation set forth herein, the mutual covenants and agreements contained in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
ARTICLE 1 DEFINITIONS
Section 1.1 Defined Terms. As used in this Agreement, the following terms shall have the meanings set forth below. Capitalized terms used but not defined in this Section 1.1 shall have the meanings ascribed to them elsewhere in this Agreement.
(a) "Agreement" means this Permanent Easement Agreement, including all Exhibits attached hereto and incorporated herein by this reference, as the same may be amended, modified, or supplemented from time to time in accordance with Section 13.5.
(b) "Compensation" means the total sum of Six Hundred Fifteen Thousand Dollars ($615,000) payable by Grantee to Grantor in consideration of the easements granted hereunder, as more particularly described in Article 4 and Exhibit C.
(c) "Easement Area" means, collectively, the PS-1 Easement Area and the PS-2 Easement Area, as described in Exhibits A-1 and A-2 and depicted on Exhibits B-1 and B-2.
(d) "Effective Date" means the date first set forth in the preamble of this Agreement.
(e) "Facilities" means all pump station structures, buildings, equipment, piping, valves, wet wells, dry wells, electrical systems (including switchgear, transformers, and backup generators), control systems (including SCADA equipment and telemetry), fencing, gates, access roads, driveways, concrete pads, retaining walls, stormwater management features, signage, lighting, security systems, and all other appurtenances and improvements constructed, installed, or maintained by Grantee within the Easement Area in connection with the Permitted Purpose.
(f) "Grantor's Property" means, collectively, Whatcom County Tax Parcel Nos. 380219-401200 and 380219-401201, together with all improvements, appurtenances, and rights pertaining thereto.
(g) "Improvements" means any structures, pavement, utilities, or other built features within the Easement Area, whether constructed by Grantee or otherwise existing as of the Effective Date.
(h) "Permitted Purpose" has the meaning set forth in Section 3.1.
(i) "Project" means the Regional Flood Resilience and Stormwater Management Program — Lower Nooksack Pump Station Network, as more particularly described in Recital C.
(j) "PS-1 Easement Area" means the approximately two and three-tenths (2.3) acre area located on Whatcom County Tax Parcel No. 380219-401200, as more particularly described by metes-and-bounds legal description in Exhibit A-1 and depicted on the easement plat attached as Exhibit B-1.
(k) "PS-2 Easement Area" means the approximately one and eight-tenths (1.8) acre area located on Whatcom County Tax Parcel No. 380219-401201, as more particularly described by metes-and-bounds legal description in Exhibit A-2 and depicted on the easement plat attached as Exhibit B-2.
(l) "Restoration Standards" has the meaning set forth in Section 8.2.
ARTICLE 2 GRANT OF EASEMENT
Section 2.1 Grant. For and in consideration of the Compensation and other good and valuable consideration described herein, Grantor hereby grants, conveys, and warrants to Grantee, and Grantee's successors and assigns, a permanent, non-exclusive easement over, under, across, and through the PS-1 Easement Area and the PS-2 Easement Area for the Permitted Purpose (collectively, the "Easement"). The Easement shall be perpetual in duration and shall run with the land. The Easement shall be binding upon Grantor's successors, assigns, heirs, personal representatives, and all persons hereafter claiming under Grantor any right, title, or interest in or to Grantor's Property or any part thereof. The Easement shall inure to the benefit of Grantee, its successors, and assigns.
Section 2.2 Easement Description. The Easement encompasses the following areas:
(a) PS-1 Easement Area: Approximately two and three-tenths (2.3) acres of Whatcom County Tax Parcel No. 380219-401200, as more particularly described by the metes-and-bounds legal description set forth in Exhibit A-1, attached hereto and incorporated herein by this reference, and as depicted on the easement plat set forth in Exhibit B-1, attached hereto and incorporated herein by this reference.
(b) PS-2 Easement Area: Approximately one and eight-tenths (1.8) acres of Whatcom County Tax Parcel No. 380219-401201, as more particularly described by the metes-and-bounds legal description set forth in Exhibit A-2, attached hereto and incorporated herein by this reference, and as depicted on the easement plat set forth in Exhibit B-2, attached hereto and incorporated herein by this reference.
All legal descriptions and easement plats referenced herein were prepared by Karen Whitfield, PLS, of Ironclad Surveying & Land Services LLC, 4850 Cordata Parkway, Suite 110, Bellingham, WA 98226. In the event of any conflict between the metes-and-bounds legal descriptions in Exhibits A-1 and A-2 and the easement plats in Exhibits B-1 and B-2, the metes-and-bounds legal descriptions shall control.
Section 2.3 Appurtenant Rights. In addition to the rights expressly granted in Section 2.1, the Easement includes the following appurtenant rights:
(a) Ingress and Egress. Grantee and its officers, employees, agents, contractors, subcontractors, consultants, and invitees shall have the right of ingress and egress over and across Grantor's Property to and from each Easement Area via existing roadways, access points, driveways, and farm lanes, including without limitation the right to improve such access routes as reasonably necessary to accommodate the construction, operation, and maintenance of the Facilities, provided that any such improvements shall be performed in a manner that minimizes interference with Grantor's agricultural operations and shall be subject to restoration upon completion of construction.
(b) Pipeline Connections. Grantee shall have the right to connect the Facilities within the Easement Area to adjacent pipeline corridors, force-main alignments, and public rights-of-way, and to construct, install, operate, maintain, repair, and replace such connections within the Easement Area as may be necessary or appropriate for the operation of the Project.
(c) Utility Connections. Grantee shall have the right to install, operate, maintain, repair, and replace utility connections (including electrical power, natural gas, telecommunications, fiber optic, and SCADA communication lines) within the Easement Area as necessary to serve the Facilities.
ARTICLE 3 PURPOSE AND USE
Section 3.1 Permitted Purpose. The Easement is granted exclusively for the following purposes (collectively, the "Permitted Purpose"):
(a) The design, engineering, construction, installation, testing, and commissioning of Pump Station No. 1 and Pump Station No. 2 and all associated Facilities within the Easement Area, including but not limited to pump station buildings, wet wells, dry wells, valve vaults, junction structures, electrical equipment, standby generators, control panels, SCADA equipment, force-main piping, and all related appurtenances;
(b) The ongoing operation, monitoring, control, and management of the pump stations and all associated Facilities, including remote monitoring, telemetry, and automated control through SCADA systems;
(c) The inspection, maintenance, repair, replacement, modification, upgrade, rehabilitation, and reconstruction of the pump stations and all associated Facilities, including the installation of new or replacement equipment, components, and systems as may be necessary from time to time throughout the life of the Facilities;
(d) Vehicular and pedestrian access to and from the Easement Area by Grantee's officers, employees, agents, contractors, subcontractors, consultants, invitees, and authorized representatives, including access by heavy equipment, trucks, and construction vehicles during construction and maintenance activities;
(e) The installation, operation, maintenance, repair, and replacement of utilities serving the pump stations, including without limitation electrical power lines and conduits, telecommunications cables, fiber optic lines, natural gas lines, and SCADA communication systems;
(f) The installation, maintenance, repair, and replacement of fencing, gates, bollards, signage (including warning signs, identification signs, and regulatory signs), security cameras, lighting, and other security measures as Grantee may reasonably determine to be necessary or appropriate for the safe and secure operation of the Facilities; and
(g) Such other activities as are reasonably necessary or incidental to the foregoing purposes, including surveying, soil testing, environmental monitoring, and water quality sampling.
Section 3.2 Limitations on Use. Grantee's use of the Easement Area shall be subject to the following limitations:
(a) Grantee shall not use the Easement Area for any purpose other than the Permitted Purpose without Grantor's prior written consent, which consent shall not be unreasonably withheld, conditioned, or delayed if the proposed use is consistent with and ancillary to the Project.
(b) Grantee shall not store, dispose of, or release hazardous materials, hazardous wastes, or hazardous substances (as such terms are defined under applicable federal, state, or local environmental laws, including but not limited to the Comprehensive Environmental Response, Compensation, and Liability Act, the Resource Conservation and Recovery Act, and the Washington Model Toxics Control Act, Chapter 70A.305 RCW) within the Easement Area, except for such quantities of fuel, lubricants, hydraulic fluid, cleaning solvents, and other materials as are customarily used in the operation and maintenance of pump station facilities and in compliance with all applicable laws, regulations, and permits.
(c) Grantee shall comply with all applicable federal, state, and local laws, regulations, ordinances, codes, and permit conditions in its use of the Easement Area and in the construction, operation, and maintenance of the Facilities.
ARTICLE 4 COMPENSATION
Section 4.1 Easement Compensation. In consideration of the permanent easements granted by Grantor to Grantee hereunder, Grantee shall pay to Grantor total compensation in the amount of Six Hundred Fifteen Thousand Dollars ($615,000) (the "Compensation"), allocated as follows:
The Compensation was determined on the basis of the independent Appraisal prepared by Jocelyn Trueblood, MAI, of Northwind Valuation Group LLC, dated March 14, 2025, and represents not less than the appraised fair market value of the easement interests being acquired. A summary of the allocation of Compensation is set forth in Exhibit C, attached hereto and incorporated herein by this reference.
Section 4.2 Payment Terms. Full payment of the Compensation shall be made by wire transfer of immediately available funds or by certified check to Grantor, or to such escrow agent as Grantor may designate in writing, at the closing of this Agreement. In no event shall payment be made later than ten (10) business days after the recording of this Agreement with the Whatcom County Auditor. Grantee shall provide Grantor with reasonable advance notice of the anticipated closing date and shall coordinate with Grantor regarding wire transfer instructions or other payment logistics. If payment is to be made through an escrow agent, the Parties shall jointly instruct such escrow agent regarding disbursement.
Section 4.3 Tax Reporting. Each Party shall be responsible for its own tax reporting obligations arising from or related to this transaction. For purposes of tax reporting:
(a) Grantor's Employer Identification Number (EIN) is 91-3487562.
(b) Grantee's Employer Identification Number (EIN) is 91-2034781.
The Parties acknowledge that the tax treatment of the Compensation may vary depending on each Party's individual circumstances and that neither Party has provided or is providing tax advice to the other. Each Party is encouraged to consult with its own tax advisor regarding the tax consequences of this transaction.
ARTICLE 5 RESERVATION OF GRANTOR'S RIGHTS
Section 5.1 Agricultural Use. Grantor reserves and retains all right, title, and interest in and to Grantor's Property not expressly granted to Grantee hereunder, including without limitation the right to continue agricultural use of all portions of Grantor's Property located outside the Easement Area. Grantor retains the unrestricted right to farm, cultivate, irrigate, fertilize, harvest crops on, and otherwise use for agricultural purposes all portions of Grantor's Property that are not within the Easement Area. Nothing in this Agreement shall be construed to limit Grantor's right to use Grantor's Property for any lawful purpose that does not interfere with the rights granted to Grantee hereunder.
Section 5.2 Use Within Easement Area. Grantor's use of the Easement Area shall be subject to the following conditions:
(a) Grantor shall not construct or place any permanent structures, buildings, foundations, or improvements within the Easement Area without Grantee's prior written consent, which consent may be withheld in Grantee's sole and absolute discretion if such construction or placement would interfere with or impair the Permitted Purpose or the Facilities.
(b) Grantor shall not plant trees, shrubs, or other deep-rooted vegetation within the Easement Area without Grantee's prior written consent.
(c) Grantor shall not conduct any excavation, grading, filling, or other earthmoving activity within the Easement Area without Grantee's prior written consent.
(d) Notwithstanding the foregoing, Grantor retains the right to use the surface of the Easement Area for agricultural purposes, including but not limited to cropping, mowing, and grazing, to the extent that such use does not interfere with the Permitted Purpose, damage the Facilities, or impair Grantee's access to or operation of the Facilities. Grantor's exercise of such surface rights shall be subject to Grantee's reasonable operational requirements and to reasonable coordination with Grantee, including reasonable advance notice to Grantee of planned agricultural activities within the Easement Area.
Section 5.3 Retained Rights of Access. Grantor retains the right of passage over and across the Easement Area to access adjoining portions of Grantor's Property, provided that such access does not interfere with Grantee's construction activities, operations, or maintenance of the Facilities. Grantor shall exercise such right of passage in a manner that does not damage or obstruct the Facilities or any access roads or improvements constructed by Grantee within the Easement Area. Grantee shall use commercially reasonable efforts to design and construct the Facilities in a manner that preserves Grantor's ability to access adjoining portions of Grantor's Property.
ARTICLE 6 REPRESENTATIONS AND WARRANTIES
Section 6.1 Grantor's Representations and Warranties. Grantor hereby represents and warrants to Grantee as of the Effective Date as follows:
(a) Organization and Good Standing. Grantor is a Washington limited liability company duly organized, validly existing, and in good standing under the laws of the State of Washington. Grantor's Certificate of Formation is on file with the Washington Secretary of State, and Grantor has not been dissolved, revoked, or suspended.
(b) Authority. Hendrik "Hank" Veldkamp, as Managing Member of Grantor, has full power, authority, and legal capacity to execute, deliver, and perform this Agreement on behalf of Grantor and to bind all members of Grantor, including Anneke Veldkamp-Ross and Willem Veldkamp. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary action on the part of Grantor and its members, and no further approvals, consents, or authorizations are required. This Agreement constitutes the legal, valid, and binding obligation of Grantor, enforceable against Grantor in accordance with its terms.
(c) Title. Grantor holds good, clear, and marketable fee simple title to Grantor's Property, including the Easement Area, subject only to those encumbrances, easements, restrictions, liens, and other matters of record disclosed in the title commitment issued by Cascade Basin Title Company (Title Officer: Diane Ashworth) in connection with this transaction. No undisclosed encumbrances, liens, or claims exist that would materially impair the easement rights granted herein.
(d) No Pending Proceedings. To the best of Grantor's knowledge, information, and belief, there are no pending or threatened condemnation proceedings, eminent domain actions, boundary disputes, quiet title actions, or other legal proceedings or claims affecting the Easement Area or that would materially impair Grantee's use and enjoyment of the Easement.
(e) No Conflicting Rights. Grantor has not granted to any third party any rights, easements, licenses, leases, or other interests in or to the Easement Area that would materially impair, conflict with, or be inconsistent with the easement rights granted to Grantee hereunder.
(f) Appraisal Review. Grantor has received and reviewed the summary of the Appraisal prepared by Jocelyn Trueblood, MAI, of Northwind Valuation Group LLC, dated March 14, 2025, and understands the basis for the Compensation offered by Grantee. Grantor has had the opportunity to obtain its own independent appraisal and has had the opportunity to consult with legal counsel and other advisors of Grantor's choosing prior to executing this Agreement. Grantor enters into this Agreement voluntarily and with full knowledge of its rights.
Section 6.2 Grantee's Representations and Warranties. Grantee hereby represents and warrants to Grantor as of the Effective Date as follows:
(a) Organization and Authority. Grantee is a Washington State governmental instrumentality duly created and existing pursuant to Chapter 43.99N of the Revised Code of Washington, with full power and authority under applicable law to acquire real property interests, including easements, for public infrastructure projects, including the Project.
(b) Authorization. This Agreement has been duly authorized, approved, and ratified by CSIA's governing body in accordance with its enabling legislation and governing procedures. All corporate, governmental, and administrative actions necessary for the execution, delivery, and performance of this Agreement by Grantee have been taken. This Agreement constitutes the legal, valid, and binding obligation of Grantee, enforceable against Grantee in accordance with its terms, subject to applicable governmental immunities.
(c) Condemnation Authority. Grantee possesses the authority to acquire property interests through the exercise of eminent domain under Chapter 43.99N RCW and the general condemnation statutes of the State of Washington. Grantee has elected to acquire the easements contemplated by this Agreement through a negotiated agreement with Grantor rather than through the exercise of condemnation authority.
(d) Fair Market Value. The Compensation offered to Grantor under this Agreement is not less than the appraised fair market value of the easement interests being acquired, as established by the independent Appraisal prepared by Jocelyn Trueblood, MAI, of Northwind Valuation Group LLC, dated March 14, 2025, in compliance with the requirements of RCW 8.25 and applicable Washington law.
(e) Permits and Approvals. Grantee will obtain and maintain, at Grantee's sole cost and expense, all federal, state, and local permits, approvals, licenses, and authorizations necessary for the construction, installation, operation, and maintenance of the Facilities within the Easement Area, including without limitation building permits, grading permits, environmental permits, shoreline permits, and all other regulatory approvals.
ARTICLE 7 CONSTRUCTION AND OPERATIONS
Section 7.1 Construction Activities. Grantee shall perform, or cause to be performed, all construction activities within the Easement Area in a good and workmanlike manner and in compliance with all applicable federal, state, and local laws, regulations, codes, ordinances, and permit conditions. Grantee shall employ qualified contractors and shall require that all construction work be performed in accordance with applicable industry standards and best practices. Grantee shall minimize disruption to Grantor's agricultural operations to the extent reasonably practicable during the construction period, including by scheduling construction activities to avoid critical planting and harvesting seasons where feasible and coordinating with Grantor regarding the timing and sequencing of construction activities. Grantee shall provide Grantor with at least thirty (30) days' advance written notice prior to the commencement of initial construction activities within each Easement Area. Such notice shall include a general description of the anticipated scope of construction activities, the estimated duration of construction, and the names and contact information for the general contractor and the CSIA project manager.
Section 7.2 Design Standards. Pump Station No. 1 and Pump Station No. 2 have been designed with finished floor elevations at sixty-five feet (65.0 ft) NAVD88, providing two and one-half feet (2.5 ft) of freeboard above the Federal Emergency Management Agency ("FEMA") Zone AE Base Flood Elevation of sixty-two and one-half feet (62.5 ft) NAVD88 as depicted on the effective Flood Insurance Rate Map for Whatcom County. All construction within the Easement Area shall comply with applicable Whatcom County building, grading, stormwater, and shoreline regulations and all conditions of applicable permits. Grantee shall design and construct the Facilities in a manner that minimizes adverse impacts on Grantor's agricultural operations and drainage patterns, including by maintaining existing drainage conveyance capacity and by avoiding unnecessary alteration of surface grades outside the Easement Area.
Section 7.3 Access During Construction. Grantee and its contractors, subcontractors, and agents shall access the Easement Area via designated access routes agreed upon by the Parties, or if no agreement is reached, via existing public roads and established access points, in order to minimize impact on Grantor's agricultural lands, crops, and farming operations. Grantee shall be responsible for repairing or compensating Grantor for any damage to Grantor's access roads, fences, gates, drainage systems (including drainage tile), irrigation systems, crops, and other agricultural improvements on Grantor's Property caused by Grantee's construction activities or by the access of Grantee's contractors and agents, in accordance with Article 8.
Section 7.4 Environmental Compliance. Grantee shall comply with all environmental laws, regulations, and permit conditions applicable to the construction and operation of the Facilities, including without limitation the following permits and approvals, which Grantee shall obtain and maintain at Grantee's sole cost and expense:
(a) State Environmental Policy Act ("SEPA") Mitigated Determination of Non-Significance, as issued or to be issued by the lead SEPA agency;
(b) Whatcom County Shoreline Substantial Development Permit, to the extent required by the Whatcom County Shoreline Master Program and the Washington Shoreline Management Act, Chapter 90.58 RCW;
(c) U.S. Army Corps of Engineers Section 404 Clean Water Act Permit and Section 10 Rivers and Harbors Act Permit, as applicable;
(d) Washington State Department of Ecology Section 401 Water Quality Certification;
(e) National Pollutant Discharge Elimination System ("NPDES") Construction Stormwater General Permit, as issued by the Washington State Department of Ecology; and
(f) Hydraulic Project Approval ("HPA"), as issued by the Washington Department of Fish and Wildlife pursuant to Chapter 77.55 RCW.
Grantee shall be solely responsible for all wetland mitigation obligations arising from the construction of the Facilities, including without limitation the purchase of approximately fifty-seven hundredths (0.57) acres of wetland mitigation credits through the Whatcom County In-Lieu Fee Program for the approximately thirty-eight hundredths (0.38) acres of permanent wetland fill associated with the Project, at the required mitigation ratio of 1.5:1, at an estimated cost of Forty-Nine Thousand Eight Hundred Seventy-Five Dollars ($49,875) (calculated at 0.57 acres multiplied by $87,500 per acre). All wetland mitigation costs shall be borne solely by Grantee and at no cost to Grantor. Grantee shall also comply with the cultural resources monitoring protocol established for archaeological site 45WH-1287 located near Pump Station No. 3, to the extent that such protocol is applicable to construction activities performed on Grantor's parcels or within the Easement Area.
Section 7.5 Operations and Maintenance. Following completion of construction and commissioning of the Facilities, Grantee shall operate and maintain the Facilities at Grantee's sole cost and expense. Grantee shall keep the Facilities in good working order and repair and shall operate the Facilities in compliance with all applicable laws, regulations, and permit conditions. Grantee shall provide Grantor with reasonable advance notice, of not less than forty-eight (48) hours, prior to entering the Easement Area for routine maintenance, inspection, or non-emergency repair activities, except in the case of an emergency. In the event of an emergency requiring immediate access to the Facilities (including but not limited to equipment failure, flooding, pipeline breach, power outage, or other conditions posing an imminent threat to public health, safety, or the environment), Grantee may enter the Easement Area without prior notice. In such event, Grantee shall notify Grantor of the emergency entry as soon as practicable, and in no event later than twenty-four (24) hours after such entry.
ARTICLE 8 RESTORATION AND CROP DAMAGE
Section 8.1 Crop Damage Compensation. Grantee shall compensate Grantor for any damage to crops, fencing, drainage tile, irrigation systems, or other agricultural improvements located on Grantor's Property outside the Easement Area that results from Grantee's exercise of rights under this Agreement, including damage caused by construction activities, maintenance operations, or access by Grantee's contractors and agents. Crop damage compensation shall be calculated based on the fair market value of the lost or damaged crop at the time of damage, taking into account the type of crop, the stage of growth, the expected yield, and the prevailing market price. In the event the Parties are unable to agree upon the amount of crop damage compensation, the matter shall be submitted to a mutually agreed-upon independent agricultural appraiser for determination, with the cost of such appraisal shared equally by the Parties.
Section 8.2 Restoration Obligations. Upon completion of construction within the Easement Area, and after any subsequent maintenance, repair, replacement, or reconstruction activities, Grantee shall restore the surface of Grantor's Property located outside the Easement Area to as near its preconstruction condition as is reasonably practicable (the "Restoration Standards"). Restoration shall include, without limitation, the following:
(a) Regrading of disturbed areas to restore preconstruction contours and drainage patterns;
(b) Replacement of topsoil to a depth and quality consistent with preconstruction conditions;
(c) Reseeding or replanting of disturbed areas with appropriate native grasses, cover crops, or agricultural crops as directed by Grantor;
(d) Repair or replacement of damaged fencing, gates, drainage tile, and irrigation systems; and
(e) Removal of construction debris, excess materials, and temporary facilities.
Restoration within the Easement Area shall be performed to the extent consistent with Grantee's operational needs and the continued maintenance and operation of the Facilities. Grantee shall not be required to restore the Easement Area to preconstruction condition if such restoration would impair the Facilities or interfere with the Permitted Purpose.
ARTICLE 9 INDEMNIFICATION
Section 9.1 Grantee's Indemnification of Grantor. To the fullest extent permitted by applicable law, Grantee shall indemnify, defend, and hold harmless Grantor and its members, managers, officers, agents, employees, successors, heirs, and assigns (collectively, the "Grantor Indemnitees") from and against any and all claims, demands, suits, actions, judgments, losses, damages, liabilities, penalties, fines, costs, and expenses (including reasonable attorneys' fees and costs of litigation) arising out of or related to:
(a) Grantee's construction, installation, operation, maintenance, repair, replacement, modification, or other use of the Easement Area or the Facilities;
(b) Any environmental contamination, pollution, or release of hazardous substances (as defined under applicable federal, state, or local environmental law) caused by Grantee, its contractors, subcontractors, agents, or employees within or from the Easement Area or resulting from the operation of the Facilities; and
(c) Any act or omission constituting negligence or willful misconduct on the part of Grantee, its officers, employees, agents, contractors, or subcontractors in connection with Grantee's exercise of rights under this Agreement.
Provided, however, that Grantee's indemnification obligations under this Section 9.1 shall not extend to any claims, losses, damages, or liabilities to the extent arising from or caused by the negligence or willful misconduct of Grantor or any Grantor Indemnitee.
Section 9.2 Grantor's Indemnification of Grantee. Grantor shall indemnify, defend, and hold harmless Grantee and its officers, directors, employees, agents, and representatives (collectively, the "Grantee Indemnitees") from and against any and all claims, demands, suits, actions, judgments, losses, damages, liabilities, penalties, fines, costs, and expenses (including reasonable attorneys' fees and costs of litigation) arising from or related to Grantor's negligence or willful misconduct in connection with Grantor's use of the Easement Area or Grantor's Property to the extent such claims relate to or affect the Easement Area or the Facilities.
Section 9.3 Sovereign Immunity. Nothing in this Agreement shall be construed as a waiver of Grantee's sovereign immunity, governmental immunity, or other immunities, privileges, or defenses available to Grantee as a governmental instrumentality under the laws of the State of Washington, except as expressly provided by applicable statute. The indemnification obligations of Grantee set forth in this Article 9 are subject to and limited by the provisions of applicable law, including but not limited to the limitations set forth in Chapter 4.92 RCW (Actions and Claims Against State) and any other applicable statutory limitations on governmental liability.
ARTICLE 10 INSURANCE
Section 10.1 Grantee's Insurance. Grantee shall maintain, or shall cause its contractors and subcontractors to maintain, during construction of the Facilities and at all times during the operation and maintenance of the Facilities, the following insurance coverages:
(a) Commercial General Liability Insurance. Commercial general liability insurance, including premises/operations liability, products/completed operations liability, contractual liability, and personal and advertising injury liability, with combined single limits of not less than Two Million Dollars ($2,000,000) per occurrence and Five Million Dollars ($5,000,000) in the aggregate. Such policy shall cover bodily injury, property damage, and personal injury arising from or related to the construction, operation, and maintenance of the Facilities within the Easement Area.
(b) Workers' Compensation Insurance. Workers' compensation insurance as required by the Industrial Insurance Act, Title 51 RCW, and any other applicable Washington State law, with statutory limits, and employer's liability insurance with limits of not less than One Million Dollars ($1,000,000) per accident.
(c) Environmental Liability Insurance. Environmental liability (pollution liability) insurance with limits reasonably appropriate for the nature and scope of the Facilities and the potential environmental risks associated with pump station operations, covering claims arising from pollution conditions or the release of hazardous substances from or within the Easement Area.
Section 10.2 Grantor as Additional Insured. Grantor shall be named as an additional insured on the commercial general liability insurance policy required under Section 10.1(a) during the period of active construction of the Facilities within the Easement Area. Such additional insured coverage shall be primary and non-contributory with respect to any insurance or self-insurance maintained by Grantor.
Section 10.3 Evidence of Insurance. Upon Grantor's written request, Grantee shall provide Grantor with certificates of insurance evidencing the coverages required under this Article 10, together with copies of applicable endorsements, including the additional insured endorsement required by Section 10.2. Grantee shall provide at least thirty (30) days' advance written notice to Grantor of any cancellation, non-renewal, or material change in the insurance coverages required hereunder.
ARTICLE 11 TITLE AND RECORDING
Section 11.1 Warranty of Title. Grantor covenants and warrants that Grantor has good, clear, and marketable fee simple title to Grantor's Property, including the Easement Area, free and clear of all liens, encumbrances, and adverse claims, except for those encumbrances, easements, restrictions, and other matters of record disclosed in the title commitment issued by Cascade Basin Title Company, and that Grantor has full right, power, and authority to grant the easements described herein. Grantor further covenants that Grantor will warrant and defend the title to the Easement and the quiet enjoyment thereof against the lawful claims of all persons claiming by, through, or under Grantor.
Section 11.2 Recording. This Agreement shall be recorded in the official records of the Office of the Whatcom County Auditor at Grantee's sole cost and expense, promptly following execution by both Parties. The recorded Agreement shall constitute constructive notice to all persons of the rights granted herein and of the existence of the Easement. Grantee shall be responsible for the payment of all recording fees, real estate excise taxes (to the extent applicable), and other costs associated with the recording of this Agreement.
Section 11.3 Title Insurance. Grantee may, at Grantee's option and sole cost and expense, obtain a policy of title insurance from Cascade Basin Title Company, or such other title insurance company as Grantee may select, insuring Grantee's easement interest in the Easement Area. Grantor shall cooperate reasonably with Grantee and with the title insurance company in connection with the issuance of such title insurance policy, including by executing such affidavits, certifications, and other documents as may be reasonably required by the title insurance company, provided that Grantor shall not be required to incur any cost or expense in connection therewith.
Section 11.4 Subordination. Grantor shall use commercially reasonable efforts to obtain subordination agreements from any existing mortgagees, lienholders, or other parties holding encumbrances of record on the Easement Area, to the extent required by Grantee's title insurance company, subordinating such mortgages, liens, or encumbrances to the Easement granted hereunder. The form of subordination agreement is attached hereto as Exhibit D. The cost of obtaining such subordination agreements shall be borne by Grantee.
ARTICLE 12 DEFAULT AND REMEDIES
Section 12.1 Default. A Party shall be in default under this Agreement if such Party fails to perform any material obligation under this Agreement and does not cure such failure within thirty (30) days after receipt of written notice of default from the non-defaulting Party specifying in reasonable detail the nature of the default and the actions required to cure such default. Notwithstanding the foregoing, if the nature of the default is such that it cannot reasonably be cured within thirty (30) days, the defaulting Party shall not be deemed in default if it commences to cure such default within the thirty (30) day notice period and thereafter diligently and continuously pursues such cure to completion within a reasonable period of time, not to exceed ninety (90) days from the date of the initial default notice, unless the Parties mutually agree in writing to a longer cure period.
Section 12.2 Remedies. Upon the occurrence of a default that remains uncured following the expiration of the applicable cure period, the non-defaulting Party may pursue any remedy available at law or in equity, including without limitation specific performance, injunctive relief, damages, and declaratory relief. The Parties acknowledge that the easement rights granted hereunder are unique and that a breach of this Agreement by either Party may result in irreparable harm for which monetary damages would be an inadequate remedy, and therefore the non-defaulting Party shall be entitled to seek specific performance and injunctive relief without the necessity of proving actual damages or posting a bond. No remedy set forth in this Agreement shall be deemed exclusive of any other remedy; all remedies available under this Agreement, at law, or in equity shall be cumulative and may be exercised concurrently or separately.
Section 12.3 Attorneys' Fees. In any action, proceeding, or arbitration to enforce or interpret this Agreement or any provision hereof, the substantially prevailing Party shall be entitled to recover from the other Party its reasonable attorneys' fees, costs, and expenses, including expert witness fees, incurred in connection with such action, proceeding, or arbitration, and in any appeal therefrom.
ARTICLE 13 GENERAL PROVISIONS
Section 13.1 Governing Law. This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Washington, without regard to its conflicts of law principles.
Section 13.2 Venue. Any action, suit, or proceeding arising out of or relating to this Agreement shall be brought exclusively in the Superior Court of Whatcom County, Washington, or, if federal jurisdiction exists, in the United States District Court for the Western District of Washington. Each Party hereby consents to the personal jurisdiction of such courts and waives any objection to venue in such courts.
Section 13.3 Notices. All notices, requests, demands, consents, and other communications required or permitted under this Agreement shall be in writing and shall be deemed duly given and received (i) when personally delivered, (ii) one (1) business day after deposit with a nationally recognized overnight courier service (such as Severin Partners LLC, Halcyon Partners LLC, or Tarrant & Co.), prepaid, or (iii) three (3) business days after deposit in the United States mail, certified mail, return receipt requested, postage prepaid, addressed as follows:
If to Grantor:
Veldkamp Family Holdings LLC
Attn: Hendrik "Hank" Veldkamp, Managing Member
2240 Meridian Street Bellingham, WA 98225
With a copy to:
Bridger Hollis & Pratt LLP
Attn: Nadia Sorensen
300 Prospect Street, Suite 600 Bellingham, WA 98225
If to Grantee:
Cascadia State Infrastructure Authority
Attn: General Counsel (Priya Shankar-Wells)
1100 Jefferson Avenue SE, Suite 400 Olympia, WA 98501
With a copy to:
Calderwood & Harkness LLP
Attn: Angela Fontaine
999 Second Avenue, Suite 4200 Seattle, WA 98104
Either Party may change its notice address by giving written notice of such change to the other Party in accordance with this Section 13.3.
Section 13.4 Entire Agreement. This Agreement, including all Exhibits attached hereto and incorporated herein by this reference (Exhibits A-1, A-2, B-1, B-2, C, and D), constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous negotiations, discussions, representations, agreements, understandings, and commitments, whether written or oral, between the Parties with respect to such subject matter. No representation, warranty, promise, or inducement has been made by either Party that is not embodied in this Agreement.
Section 13.5 Amendment. This Agreement may not be amended, modified, supplemented, or otherwise changed except by a written instrument duly executed by both Parties (or their respective successors or assigns) and recorded with the Whatcom County Auditor. No oral amendment or modification shall be effective.
Section 13.6 Assignment.
(a) Grantee may assign, transfer, or convey its interest in the Easement, or any portion thereof, to any successor governmental entity, public agency, or public utility without the prior written consent of Grantor, provided that the assignee expressly assumes in writing all of Grantee's obligations under this Agreement. Grantee shall provide Grantor with written notice of any such assignment within thirty (30) days after the effective date thereof.
(b) Grantor may freely sell, convey, transfer, mortgage, or otherwise encumber Grantor's fee title interest in Grantor's Property, or any portion thereof, provided that any such conveyance or encumbrance shall be subject to and subordinate to the Easement granted hereunder. Grantor shall notify any purchaser, transferee, or encumbrancer of the existence of this Agreement and the Easement.
Section 13.7 Severability. If any provision of this Agreement, or the application thereof to any person or circumstance, is held to be invalid, illegal, or unenforceable by a court of competent jurisdiction, such invalidity, illegality, or unenforceability shall not affect the validity, legality, or enforceability of any other provision of this Agreement, and the remaining provisions shall continue in full force and effect. The Parties shall negotiate in good faith to replace any invalid, illegal, or unenforceable provision with a valid, legal, and enforceable provision that most nearly achieves the original intent of the Parties.
Section 13.8 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument. Execution and delivery of this Agreement by facsimile or electronic transmission (including PDF) shall be deemed to be, and shall have the same legal effect as, execution and delivery of an original signed copy.
Section 13.9 Binding Effect. This Agreement shall be binding upon and shall inure to the benefit of the Parties and their respective successors, heirs, personal representatives, and assigns. The Easement and the obligations and covenants contained herein shall run with the land as covenants appurtenant and shall be binding upon all persons hereafter acquiring any right, title, or interest in Grantor's Property.
Section 13.10 No Third-Party Beneficiaries. Except as otherwise expressly provided herein, this Agreement is entered into solely for the benefit of the Parties and their respective successors and assigns, and nothing in this Agreement shall be construed to create any right, claim, or cause of action in favor of any third party, nor shall any third party be deemed a beneficiary of this Agreement.
Section 13.11 Waiver. No waiver of any breach or default under this Agreement shall constitute a waiver of any other or subsequent breach or default. No waiver of any provision of this Agreement shall be effective unless made in writing and signed by the Party against whom enforcement of the waiver is sought. The failure of either Party to enforce any right or remedy under this Agreement shall not constitute a waiver of such right or remedy or of any other right or remedy.
Section 13.12 Condemnation Authority Preserved. Nothing in this Agreement shall be construed to limit, restrict, or waive Grantee's authority to exercise its powers of eminent domain and condemnation under Chapter 43.99N RCW, or under any other applicable provision of law, with respect to any other property interest, whether on Grantor's Property or otherwise, that may be necessary or desirable for the Project or any other lawful purpose of Grantee. The acquisition of the Easement through this negotiated Agreement shall not create any presumption against the exercise of condemnation authority in connection with any future acquisition.
[SIGNATURE PAGES FOLLOW]
IN WITNESS WHEREOF, the Parties have executed this Permanent Easement Agreement as of the date first set forth above.
GRANTOR
VELDKAMP FAMILY HOLDINGS LLC, a Washington limited liability company
By: ________
Name: Hendrik "Hank" Veldkamp
Title: Managing Member
Date: ________
EIN: 91-3487562
GRANTEE
CASCADIA STATE INFRASTRUCTURE AUTHORITY, a Washington State governmental instrumentality
By: ________
Name: Martin R. Calloway
Title: Executive Director
Date: ________
EIN: 91-2034781
ATTESTED AND APPROVED AS TO FORM:
By: ________
Name: Priya Shankar-Wells
Title: General Counsel
Date: ________
NOTARY ACKNOWLEDGMENTS
NOTARY ACKNOWLEDGMENT — GRANTOR
STATE OF WASHINGTON ) ) ss. COUNTY OF WHATCOM )
On this _ day of ___, 2025, before me, the undersigned, a Notary Public in and for the State of Washington, duly commissioned and sworn, personally appeared Hendrik "Hank" Veldkamp, to me known (or proved to me on the basis of satisfactory evidence) to be the Managing Member of Veldkamp Family Holdings LLC, the Washington limited liability company that executed the within and foregoing instrument, and acknowledged said instrument to be the free and voluntary act and deed of said limited liability company, for the uses and purposes therein mentioned, and on oath stated that he was authorized to execute said instrument on behalf of said limited liability company.
IN WITNESS WHEREOF, I have hereunto set my hand and official seal the day and year first above written.
________________________________________
Notary Public in and for the State of Washington Residing at: ______ My commission expires: ____
(NOTARIAL SEAL)
NOTARY ACKNOWLEDGMENT — GRANTEE
STATE OF WASHINGTON ) ) ss. COUNTY OF THURSTON )