TRANSMITTAL LETTER FOR BOARD MEETING OF NOVEMBER 5, 2026
COMMITTEE ON REAL ESTATE
Mr. John P. Murray, Executive Director
Title
Authority to amend two lease agreements with Seneca Petroleum Holdings, Inc., on approximately 16 acres of District real estate located south of the Chicago Sanitary and Ship Canal in Will County, Illinois; Main Channel Parcels 20.03 and 21.07. Consideration shall be a new annual rent of $90,480.00 for the lease of Main Channel Parcel 20.03 and $106,996.42 for the lease of Main Channel Parcel 21.07
Body
Dear Sir:
Seneca Petroleum Holdings, Inc. (“Seneca”) leases two parcels of District real estate under a lease that commenced in 1952 and has been subdivided, amended, and assigned from time to time. Seneca was assigned the lease of Main Channel (“MC”) Parcel 20.03 (6.248± acres) in 1993, and the lease of adjacent MC Parcel 21.07 (9.782± acres) in 1999. The parcels are located south of the Chicago Sanitary and Ship Canal in Will County, Illinois. Seneca manages the parcels as one unit to operate its petroleum and asphalt storage and transportation business. Both leases expire April 30, 2051. Seneca’s current annual rent is $45,240.00 for MC Parcel 20.03 and $53,498.21 for MC Parcel 21.07.
Seneca’s leases require that the annual rents be adjusted every 10 years based on 8% of the appraised fair market value of the land. For MC Parcel 20.03, these scheduled rent adjustments are subject to a 30% cap on rent increases every other 10 years, but for MC Parcel 21.07, the rent adjustments have no cap.
To more closely align these older leases with the MWRD Act, it is requested that both of Seneca’s leases be amended to adopt the statutory rent increase cap of 100% from the scheduled 2025 rent adjustment through the remainder of the lease term. The lease for MC Parcel 20.03 will retain the 30% cap on the rent adjustments that occur for every other 10-year period. The amendment will help the District manage Seneca’s leases more consistently with other commercial lease agreements in the District’s leasing program.
With the 100% rent increase cap in place, Seneca’s new annual rent will double from $45,240.00 to $90,480.00 for MC Parcel 20.03, and from $53,498.21 to $106,996.42 for MC Parcel 21.07.
In addition, a surveyor has reviewed the boundaries of MC Parcel 20.03 and determined that its area is 6.248± acres. Existing lease documents provide that MC Parcel 20.03 is 7.9± acres. Accordingly, it is also requested that the lease agreement for MC Parcel 20.03 be amended to reflect the more accurate area of 6.248± acres. All other lease terms will be unchanged.
It is requested that the Executive Director recommend to the Board of Commissioners that it grant authority to amend two lease agreements with Seneca Petroleum Holdings, Inc., on approximately 16 acres of District real estate located south of the Chicago Sanitary and Ship Canal in Will County, Illinois; Main Channel Parcels 20.03 and 21.07. Consideration shall be a new annual rent of $90,480.00 for the lease of Main Channel Parcel 20.03 and $106,996.42 for the lease of Main Channel Parcel 21.07.
It is also requested that the Executive Director recommend to the Board of Commissioners that it authorize and direct the Chairman of the Committee on Finance and the Clerk to execute said Amendments to Lease Agreements after they are approved by the General Counsel as to form and legality.
Requested, Susan T. Morakalis, General Counsel, STM:BJD:JAW:vp
Recommended, John P. Murray, Executive Director
Disposition of this agenda item will be documented in the official Regular board Meeting Minutes of the Board of Commissioners for November 5, 2026
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