TO: Honorable Mayor and Members of the City Council
FROM: Sam Gutierrez, Director of Public Works
PREPARED BY: Yovanni Viramontes, Associate Engineer
DATE: August 7, 2024
SUBJECT: Award Professional Services Agreement to John L. Hunter and Associates to Perform Commercial and Industrial Inspections for Stormwater Quality Compliance.
SUMMARY
The purpose of this staff report is for City Council to consider awarding a Professional Services Agreement (PSA) to John L. Hunter and Associates for assistance with National Pollutant Discharge Elimination System (NPDES) and Industrial Program compliance inspections.
RECOMMENDATION
It is recommended that the City Council:
1) Authorize the Mayor to execute a Professional Service Agreement with John L. Hunter and Associates (JLHA) in the amount not to exceed of $74,850.00 for assistance with NPDES and Industrial Waste Program Inspections; and
2) Authorize the Director of Finance to appropriate an amount not-to-exceed $17,000 from Account 258- 50-510-51100-15400 and $57,850 from Account 249-50-510-51100-15400 to fully fund the professional services; and
3) Authorize the Public Works Director to process the necessary documentation for the requested services.
FISCAL IMPACT
There is no fiscal impact to the General Fun d. The funds are available in Account 258 -50-510-51100-15400 ($40,000) and 249-50-510-51100-15400 ($171,500) in the approved budget for Fiscal Year 2024/2025.
BACKGROUND
The City of Baldwin Park, operating under Los Angeles Water Board NPDES Permit No. CAS004004, is mandated to regularly inspect commercial and industrial facilities for stormwater quality compliance. This permit targets stormwater discharges within coastal Los Angeles County, ensuring pollutants such as oil, wastewater, and trash do not enter the storm drain system and ultimately contaminate local waterways.
The City is an enrollee under State Water Board Order WQ 2022 -0103-DWQ. This order requires a progra m to mitigate sanitary sewer blockages caused by Fats, Oils, and Grease (FOG) discharged by businesses into the sanitary sewer system. This program is bolstered by the City's existing Industrial Waste (IW) ordinance, adopted in 1983, which aligns with the goals of the State's FOG Program mandate.
The objective of these NPDES, FOG, and IW programs is twofold:
1. Prevent Pollution: Safeguard waterways from contamination caused by polluted urban runoff originating from industrial and commercial facilities.
2. Protect Infrastructure: Prevent the degradation of the City's sanitary sewer system by mitigating FOG - related blockages.
3. To meet State requirements and adhere to the City's IW ordinance, businesses under these programs are subject to regular inspections to ensure compliance. The LA Water Board requires biannual stormwater quality inspections, while the City's IW ordinance mandates annual inspections, with some businesses requiring multiple inspections within a year.
Key business types targeted for inspection under these programs include:
1. Food service establishments
2. Vehicle maintenance facilities
3. Manufacturers/producers
4. Transportation industry
5. Waste storage and hauling facilities
DISCUSSION
In order to meet the requirements set by the State, LA Water Board, and City’s Industrial Waste ordinance, Staff sent a request to the city on-call consultant, JLHA, that specializes in NPDES and Industrial Programs, to assist with completing one round of mandatory inspections for both programs. JLHA was added to the city’s on-call list after being selected as an approved consultant during the latest request for qualifications approved by City Council. They specialize in the services being requested by the city and have provided a proposal with two options.
The first option included one round of NPDES MS4 compliance inspections for approximately 350 industrial and commercial facilities identified by the city for a total of $56,600 . The second option includes the services for Option 1 (first round of NPDES MS4 inspections) and providing one round of Industrial Waste Inspections for approximately 300 permitted facilities for a total of $74,850 . As part of both options JLHA will also provide follow-up inspections to verify corrections are made after the initial inspection.
To be in compliance of both programs, Staff is recommending to procced with Option 2 for the following reasons:
1. Both Programs require annual inspections to be in compliance and receive local funds for management of the NPDES and Industrial Waste Programs.
2. There are over 600 potential inspections to be conducted, which demands an excessive amount of time and resources estimated to take approximately 800 hours to complete per JLHA proposal . This heavy commitment will inadvertently divert attention from other essential responsibilities if done by Staff.
3. JLHA, Option 2, is providing a discount on services in the amount of $22,500 since there is a crossover between the inspections for the two programs.
4. Although the city will pay JLHA for these services, the offset cost of annual inspection fees is estimated to be in excess of $122,700 based on 300 businesses with a SIC code Inspection Class of A. If a business has an inspection class of B, C, D, E, or M, the annual inspection cost will be higher and vary per the City IW Program Fee Schedule.
ALTERNATIVES
1. The City Council may choose not to award the professional service agreement with John L. Hunter and Associates (JLHA) at this time and direct staff to bring the item back at a later date with additional options.
2. Provide Staff with alternate direction.
CEQA REVIEW
The action being considered by the city council is exempt from the California Environmental Quality Act (CEQA) because it is not a “project” under section 15378(b)(5) of CEQA guidelines. The action involves an organizational or administrative activity of g overnment that will not result in a direct or indirect physical change in the environment.
LEGAL REVIEW
This report has been reviewed and approved by the City Attorney as to legal form and content.
ATTACHMENTS
1. Professional Services Agreement
2. Proposal from JLH
Consultant Services Agreement Page 1 of 6
CONSULTANT SERVICES AGREEMENT
THIS AGREEMENT is made and entered into this 7th day of August, 2024 by and between the City of Baldwin Park, ("City"), and John L. Hunter and Associates (“Consultant").
In consideration of the following mutual covenants, pro visions and agr eements, and other valuable consideration, the receipt and sufficiency of which is hereby acknowledged, City and Consultant agree as follows:
1. SCOPE OF SERVICES . Consultant agrees to perform during the term of this Agreement, the tasks, obligations, and services set forth in the “Scope of Services” attached to and incorporated into this Agreement as Exhibit “A.” Duration of Scope of Services may be extended on a month-to-month basis, but shall not exceed the total compensation.
2. COMPENSATION. City shall pay for the services performed by Consultant pursuant to the terms of this Agreement at the time and manner set forth at a not -to-exceed compensation amount of $74,850.00.
3. TIME FOR PERFORMANCE . Consultant shall perform the se rvices above described in a timely manner in accordance with the professional standard practices.
4. AUDIT OR EXAMINATION. Consultant shall keep all records of funds received from City and make them accessible for audit or examination for a p eriod of three years after final payments are issued and other pending matters.
5. STATUS OF CONSULTANT. Consultant shall provide all necessary personnel, equipment and material, at its sole expense, in order to perform the services required of it pursuant to this Agreement. F or the purpose of this Agreement, Consultant shall be deemed, for all purposes, an independent contractor and shall have control of all work and the manner in which it is performed. Consultant shall be free to contract for similar ser vices to be per formed for other entities while under contract with City. Consultant is not an agent or employee of City and is not entitled to participate in any pension plan, insurance, bonus or similar benefits City provides for its employees. Consultant shall be responsible to pay and hold City harmless from any and all payroll and other taxes and interest thereon and penalties, therefore, which may become due as a result of services performed hereunder.
6. ASSIGNMENT. This Agreement is for the specific services with Consultant as set forth herein. Any attempt by Consultant to assign the benefits or burdens of this Agreement without written approval of City is prohibited and shall be null and void; except that Consultant may assign payments due under this Agreement to a financial institution.
7. RIGHT TO UTILIZE OTHERS. City reserves the right to utilize others to perform work similar to the Services provided herein.
8. COMPLIANCE WITH LAW. Contract services shall be provided in accordance with the a pplicable laws and regulations of all governmental agencies that are in force at the time services are performed. Consultant shall be responsible for becoming aware of and staying abreast of all such laws and ensuring that all services provided her eunder conform to
Consultant Services Agreement Page 2 of 6
such laws. The terms of this Agreement shall be interpreted according to the laws of the State of California.
9. LIABILITY. Consultant shall indemnify, and hold harmless City, its officials, officers, and employees against any and all actions, claims, damage s, lia bilities, losses or expenses of whatsoever kind, name or nature, including legal costs and reasonable attorneys' fees, whether or not suit is actually filed, and any judgment rendered against City and/or its officials, officers, or em ployees that ma y be a sserted or claimed by any person, firm, or entity arising out of Consultants' negligent performance, or the negligent performance of its agents, employees, subcontractors, or invitees, as well as, negligent acts or omissions of Consult ant, it’s agent s, emp loyees, subcontractors or invitees, however, this indemnity clause shall not apply if there is concurrent passive or active negligence on the part of City, or its officials, officers, agents or employees.
10. INSURANCE. Consultant shall maintain insurance coverage in accordance with the following during the course of its performance hereunder:
(A) Comprehensive General Liability Insurance (including premises and operations, contractual liability, personal injury and independent Consultants' liability) with the following minimum limits of liability:
(1) Personal or Bodily Injury -- $1,000,000, single limit, per occurrence; and (2) Property Damage -- $1,000,000, single limit, per occurrence; or (3) Combined single limits -- $2,000,000.
(B) Comprehensive Aut omobile Liability Insurance including as applicable own, hired and non -owned automobiles with the following minimum limits of liability:
(1) Personal or Bodily Injury -- $1,000,000, single limit, per occurrence; and (2) Property Damage -- $1,000,000, single limit, per occurrence; or (3) Combined single limits -- $2,000,000.
(C) Professional Liability Insurance with annual aggregates of $1,000,000 or such other amount as may be approved in writing by the City.
(D) Worker's Compensation Insu rance that comp lies w ith the minimum statutory requirements of the State of California.
(E) Prior to commencement of services hereunder, Consultant shall provide City with a certificate of Insurance reflecting the above, and an endorsement for each policy of insurance which shall provide:
(1) The City, and its officials, officers, agents and employees are named as additional insured (with the exception of Professional Liability and Worker’s Compensation);
(2) The coverage provided shall be primary (with th e exception of Professional Liability and Worker’s Compensation) as respects to City, its officials, officers, agents or employees; moreover, any insurance or self-insurance maintained by City or its officials, officers,
Consultant Services Agreement Page 3 of 6
agents or employees shall be in excess of Consultants’ insurance and not contributed with it.
(3) The insurer shall provide at least thirty (30) days prior written notice to City of cancellation or of any material change in coverage before such change or cancellation becomes effective.
(F) With respect to Workers’ Compensation Insurance, the insurer shall agree to waive all rights of subrogation against City and City personnel for losses arising from work performed by Consultant for City, and the insurer's agreement in this regard shall be reflected in th e Work ers’ Compensation Insurance endorsement.
11. OWNERSHIP OF DOCUMENTS. All of the documents required to be prepared pursuant hereto shall, upon the completion thereof, be deemed for all purposes to be the property of City. City’s owne rship of docume nts includes any and all analysis, computations, plans, correspondence and/or other pertinent data, information, documents, and computer media, including disks and other materials gathered or prepared by Consultant in performance of this Agr eement. Such w ork product shall be transmitted to City within ten (10) days after a written request therefore. Consultant may retain copies of such products. Any re -use by City shall be at the sole risk of City and without liability to Consultant.
12. RECORDS AND INS PECTIONS. Consultant shall maintain full and accurate records with respect to all services and matters covered under this Agreement. City shall have free access at all reasonable times to such records, and the right to examine and audit th e same and to m ake tr anscripts therefrom, and to inspect all program data, documents, proceedings and activities. Consultant shall maintain an up -to-date list of key personnel and telephone numbers for emergency contact after normal business hours.
13. TAXPAYER IDENTIF ICATION NUMBER. Consultant shall provide City with a complete Request for Taxpayer Identification Number and Certification, Form W-9, as issued by the Internal Revenue Service.
14. CONFLICT OF INTEREST . Consultant agrees that any conflict or potential conflict of interest shall be fully disclosed prior to execution of contract and Consultant shall comply with all applicable federal, state and county laws and regulations governing conflict of interest.
15. POLITICAL ACTIVITY/LOBBYING CERTI FICATION. Consultant may not conduct any activity, including any payment to any person, officer, or employee of any governmental agency or body or member of Congress in connection with the awarding of any federal contract, grant, loan, intended to influen ce legislation, administrative rulemaking or the election of candidates for public office during time compensated under the representation that such activity is being performed as a part of this Agreement.
16. RIGHT TO TERMINATE. City may terminate this Agreement at any time, with or without cause, in its sole discretion, with thirty (30) days written notice.
17. EFFECT OF TERMINATION . Upon termination as stated in Paragraph “ 16” of this Agreement, City shall be liable to Consultant only for work perfor med by Consulta nt up to
Consultant Services Agreement Page 4 of 6
and including the date of termination of this Agreement, unless the termination is for cause, in which event Consultant need be compensated only to the extent required by law. Consultant shall be entitled to payment for work satisf actorily completed to date, based on proration of the compensation set forth in Exhibit “B” attached hereto. Such payment will be subject to City’s receipt of a close-out billing.
18. LITIGATION FEES . Should litigation arise out of this Agreement for th e performance thereof, the court shall award costs and expenses, including reasonable attorney’s fees, to the prevailing party. In awarding attorney’s fees, the court shall not be bound by any court fee schedule but shall award the full amount of costs, e xpenses and attorney’s fees paid and/or incurred in good faith. “Prevailing Party” shall mean the party that obtains a favorable and final judgment. Should litigation occur, venue shall be in the Superior Court of Los Angeles County. This paragraph shal l not apply and litigation fees shall not be awarded based on an order or otherwise final judgment that results from the parties’ mutual settlement, arbitration, or mediation of the dispute.
19. COVENANTS AND CONDITIONS . Each term and each provision of t his Agreement t o be p erformed by Consultant shall be construed to be both a covenant and a condition.
20. INTEGRATED AGREEMENT. This Agreement represents the entire Agreement between the City and Consultant . No verbal agreement or implied covenant shall be held to vary the provisions of this agreement. This Agreement shall bind and inure to the benefit of the parties to this Agreement, and any subsequent successors and assigns.
21. MODIFICATION OF AGREEMENT . This Agreement may not be modified, nor may any of the ter ms, pr ovisions or conditions be modified or waived or otherwise affected, except by a written amendment signed by all parties.
22. DESIGNATED REPRESENTATIVES . The Consultant Representative (A) designated below shall be responsible for job performance, negotiations, contractual matters, and coordination with the City. The City Representative (B) designated below shall act on the City’s behalf as Project Manager.
(A) CONSULTANT : Attn: Cameron McCullough
John L. Hunter and Associates
6131 Orangethorpe Avenue
Buena Park, CA 91706
(626) 536-2173
(B) City of Baldwin Park
Att.: Sam Gutierrez
14403 East Pacific Avenue
Baldwin Park, CA 91706
(626) 960-4011 ex. 460
23 NOTICES. Notices pursuant to this Agreement shall be in writing and may be given by personal delivery or by mail . Notices shall be directed to City’s Designated Representative identified in Paragraph “21” of this Agreement.
Consultant Services Agreement Page 5 of 6
IN WITNESS WHEREOF, the parties have executed this Agreement on the day first above written.
John L Hunter and Associates (JLHA)
By: Q., - ~
Name
Title
Date: 7" / ~ \ / '2 o "2.., '-j
CITY OF BALDWIN PARK
Cameron McCullough
Director
APPROVED AS TO FORM:
By: ____________ _
Date:
Norma Tabares
City Attorney
-----------
By:-------------
Emmanuel J. Estrada
Mayor
Date: -----------
EXHIBIT A
SCOPE OF SERVICES
July 31, 2024
Sam Gutierrez
City of Baldwin Park
14403 E Pacific Ave
Baldwin Park, CA 91706
Proposal for NPDES Industrial/Commercial Facility Program Assistance for Fiscal Year 202 4-25, including an Optional Task for Industrial Waste Program Inspections
Dear Sam Gutierrez:
We at John L. Hunter and Associates (JLHA) welcome the opportunity to provide our professional surface water quality services to the City of Baldwin Park. Our scope of services consists of providing knowledgeable personnel to assist the City with the tasks described below.
Option 1: NPDES MS4 Industrial/Commercial Facilities Program Assistance We will conduct one round of MS4 NPDES compliance inspections at approximately 350 industrial and commercial facilities identified by the City. We will inspect facilities for proper BMP implementation. Inspections standard operating procedures includes 1) inspecting facility layout to locate the stormwater drainage path, storage areas, process areas, and heavy equipment wash and maintenance areas, as applicable, 2) determining the facility’s impact on stormwater quality through proper BMP implementation and illicit discharge elimination, 3) verifying industrial classification, and 4) determining the nee d for corrective actions and setting up follow -up dates. For egregious or repeated cases of noncompliance, we will assist in preparing enforcement notices. If noncompliance persists, we can work with City enforcement staff to resolve the issue.
Work under this program will also include facility tracking, business education, and assisting industrial businesses with enrollment issues under the NPDES Industrial General Permit.
Option 2: NPDES MS4 Industrial/Commercial Facilities Program and Industrial Waste Program Assistance In addition to implementing Option 1, we are available to assist the City with its Industrial Waste Program by providing one round of Industrial Waste inspections at approximately 300 IW permitted facilities. We will inspect to verify proper control of industrial waste discharges to the City’s sanitary sewer system. The compliance inspections focus on employee education as well as verification of proper source control BMPs and grease trap/interceptor maintenance. We complete an inspection report and provide it to the facility contact. If corrections are required, the inspector lists them on the inspection report. We conduct follow-ups to verify that the corrections were made. Some common issues can be addressed via email or phone, such as the need to provide updated industrial waste or yellow grease hauling/interceptor pump-out records.
Schedule and Cost
The timeframe of this proposal is from July 1, 2024, to June 30, 2025. Our rate schedule and estimated costs are on the following page. We have applied a discount to the Option 2 task due to the tie in with the Industrial Waste Inspection Program. We will not exceed the total cost estimate without City authorization.
If you have any questions you can reach me at [email protected] or 562.726.4259.
Sincerely,
Cameron McCullough, Director
2 Standard Rate Schedule
Principal $220 / hour
Director $195 / hour
Program Manager $195 / hour
Staff Engineer $195 / hour
Project Manager $185 / hour
Assistant Project Manager $165 / hour
Project Engineer $165 / hour
Compliance Specialist II $135 / hour
Project Analyst II $135 / hour
Compliance Specialist I $125 / hour
Project Analyst I $125 / hour
Administrative Assistant, Laborer (OSHA 40hr certified) $85 / hour State Certified Laboratory Analysis Cost + 5%
Legal Consultation, Court Appearances/Document review, etc. $290 / hour Subcontracted equipment Cost + 5%
Fee Schedule effective as of April 10, 2023
Estimated Costs for Services
Option 1: Estimated Costs for NPDES Industrial/Commercial Facility Program Task Name Team* Rate Hours Cost Total
Activities include 1) facility inspections (assume 350
site visits and 35 follow-up visits), 2) facility tracking, 3) business education, 4) enforcement, and 5) project
management
CS1 $125 364 $45,500
PA2 $135 20 $2,295
PA1 $125 20 $2,500
CS1 $125 18 $2,250
PM $185 18 $3,330
Total Not to Exceed $55,875
* CS: Compliance Specialist, PA: Project Analyst, Project Manager
Option 2: Estimated Costs for both the NPDES Industrial/Commercial Facility Program and the Industrial Waste Program Task Name Team* Rate Hours Cost Total
1. MS4 NPDES Industrial/Commercial Facility Program Assistance as described in Option 1 $55,875
2. Industrial Waste Program Assistance $18,975
Activities include a) facility inspections (assume 300
site visits and 15 follow-up visits), b) facility tracking, c) business education, d) enforcement, and e) project
management
CS1 $125 307 $38,375
CS1 $125 10 $1,250
PM $125 10 $1,850
IW Services Discount, due to inspection programs crossover -$22,500 Total Not to Exceed $74,850
* CS: Compliance Specialist, PA: Project Analyst, Project Manager
STAFF REPORT
ITEM NO. ____9____
TO: Honorable Mayor and Members of the City Council
FROM: Sam Gutierrez, Director of Public Works
PREPARED BY: David Lopez, Associate Engineer
DATE: August 7, 2024
SUBJECT: Accept Plans and Specifications and Authorization to Publish Notice Inviting Bids for City Project No. CIP 24-001-55027 – Morgan Park Restroom Improvements
SUMMARY
This item will accept and approve plans and specifications and authorize staff to solicit bids through the publication of a Notice Inviting Bids for construction of City Project No. CIP 24 -001-55027 – Morgan Park Restroom Improvements . The project includes construction of improvements to the existing public restroom building at Morgan Park. Improvements include plumbing, ADA building code compliance improvements, wash stations, stalls, infant changing stations, fixtures change out and interior wall remodel.
RECOMMENDATION
It is recommended that the City Council accept and approve the plans and specifications for City Project No. CIP 24-001-55027 and authorize staff to publish a Notice Inviting Bids for construction.
FISCAL IMPACT
There is no fiscal impact to the General Fund. Upon review of bids received, staff will recommend a construction contract award. At that time, staff will also provide a construction cost estimate with a breakdown by improvements to be constructed.
BACKGROUND
At their August 2, 2023, City Council Meeting, City Council awarded an agreement to Infrastructure Engineers a Bowman Consultant Group, Ltd. Company (Bowman) for design services , including the preparation of Plans, Specification, and Estimate (PS &E) for improvements to the public restrooms at Morgan Park . As part of the work, Three (3) conceptual renderings were produced and shared at community engagement events. Community participation contributed to the selected design.
On March 6, 2024, Bowman has completed the work and submitted the PS&E for plan check and approval.
On April 11, 2024, staff received a proposal from RKA Consulting Group to provide services for Building and Safety Code plan check review. RKA completed its review on May 14, 2024 and provided staff with comments and corrections.
On June 11, 2024, Bowman re-submitted the PS&E addressing the corrections for staff review.
DISCUSSION
Staff has completed review of the PS&E and is recommending the project for construction. This project includes construction of improvements to an existing restroom building in Morgan Park. Improvements include plumbing, ADA building code compliance improvements, wash stations, stalls, infant changing stations, fixtures change out and interior wall remodel.
ALTERNATIVES
1. The City Council may choose not to accept the plans and specifications and task staff to provide alternative designs. This action is not recommended as the PS&E is complete and ready for bid. Delaying the project may risk meeting certain budget expenditure requirements.
2. Provide staff with alternate direction.
CEQA REVIEW
The subject project, Morgan Park Restroom Improvements, is exempt from the California Environmental Quality Act (CEQA) pursuant to a Class 1 (Section 15201, Existing Facilities) which consists of the operation, repair, maintenance, permitting, leasing, licensing, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features . The project meets the exception pursuant to subsection (a) which includes interior or exterior alterations involving such things as interior partitions, plumbing, and electrical conveyances. The key consideration for a Class 1 exemption is whether the project involves negligible or no expansion of an existing use.
LEGAL REVIEW
This report has been reviewed and approved by the City Attorney as to legal form and content.
ATTACHMENTS
1. Notice Inviting Bids
2. Plans and Specifications (PS&E – available electronically at the City Clerk’s Office)
NOTICE INVITING SEALED BIDS CITY PROJECT NO. 24-001-55027 Morgan Park Restroom Remodel PUBLIC NOTICE IS HEREBY GIVEN that the City of Baldwin Park invites sealed bids for the above-stated project and will receive such bids in the offices of the City Clerk, 14403 East Pacific Avenue, Baldwin Park, California 91706, until 2:00 P.M., September 11, 2024, at which time the proposals will be publicly opened and read. Bidders and/or authorized agents are invited to be present. All information submitted with the bid is public information and may be subject to disclosure. Project Description – The general nature of work consists of furnishing all labor, material, equipment, services, and incidentals required for the remodel of the restrooms at Morgan Park, including the demolition of the designated items, remodel of the restrooms, Demolish and remove existing ceiling, flooring, walls, partitions and toilet accessories per demolish plans, Replace it with new ceiling, flooring wall, wall tile, partitions, toilet accessories and miscellaneous, plumbing and lighting fixtures per construction plans. The bid items, corresponding estimated quantities, and the time allowed to complete the work are listed in the Proposal. The descriptions of bid items are defined on the construction plans. Proposals – Bids shall be sealed and plainly marked “Sealed Bid for BID CITY PROJECT NO. CIP 24-001-55027” Bids must be prepared using the Contractor’s Bid Proposal forms and all the other forms identified in the Instructions to Bidders. The forms required to complete a bid package are found in Section “C” of these Contract Documents. No bids will be accepted if not submitted using the approved forms. The Information to Bidders provides prospective bidders a summary of requirements for acceptance of bids, guidelines that the City uses in awarding contracts, rules to ensure fairness in contractor procurement and guidelines to aid in interpretation of documents. The Construction Contract / Agreement defines the Contract Documents which serve to control construction, work performed, and materials furnished, and includes the Specifications and Plans. Plans and Specifications Documents – Specifications and proposal forms may be requested by contacting the Engineering Division office located at 14403 East Pacific Avenue, Baldwin Park, CA 91706, (626) 960-4011 on and after September 16, 2024, Monday through Thursday between the hours of 8:00 A.M. and 5:00 P.M. Prospective Bidders may obtain electronic versions of all construction documents, addendums, and/or submit questions by visiting the City’s website and clicking on “Bid Portal” under the “Public Works” tab or by accessing the link to the project at https://www.baldwinpark.com/engineering/bids-and-proposals. Bid Security – Each bid must be accompanied by cash, certified check, cashier’s check, or bidder’s bond made payable to the City of Baldwin Park or issued by a surety admitted to do business in California, for an amount equal to at least ten percent (10%) of the amount of bid. Such guaranty will be forfeited to the City of Baldwin Park should the bidder to whom the contract is awarded fail to enter into the contract. The City of Baldwin Park reserves the right to reject any and all bids and to waive any minor irregularities in the bid documents. Bidders may not withdraw their bid for a period of sixty (60) days after the bid opening date. City Business License, Contractors License and Permit – Prior to contract execution, the contractor and his/her subcontractors shall obtain a City of Baldwin Park business license. In accordance with provisions of Section 3300 of the California Public Contract Code, the City has determined that the Contractor shall possess a valid Class A California Contractor's License or other appropriate license classification under the State Contracting Code at the time the contract is bid. Failure to possess such license may render the bid non–responsive. The successful bidder will be required to obtain a City encroachment permit to work in public right-of-way, issued at no fee for the project.
Prevailing Wages – In accordance with the provisions of Sections 1770 et seq., of the Labor Code, the Director of the Industrial Relations of the State of California has determined that the general prevailing rates of wages are applicable to the work to be done. The Contractor will be required to pay to all persons employed on the project by the Contractor sums not less than the sums set forth in the documents entitled "General Prevailing Wage Determination made by the Director of Industrial Relations pursuant to California Labor Code, Part 7, Chapter 1, Article 2, Sections 1770, 1773, 1773.1." These documents can be reviewed in the office of the City Clerk or may be obtained from the State. Contractor’s Registration – In accordance with Labor Code Section 1771.1, a contractor or subcontractor shall not be qualified to (a) bid on or be listed in a bid proposal on or after March 1, 2015, or (b) engage in the performance of this Work after April 1, 2015, unless currently registered with the Department of Industrial Relations and qualified to perform the work pursuant to labor Code Section 1725.5. Compliance Monitoring and Enforcement – Contractor’s performance of the work described in this Notice Inviting Bids is subject to compliance monitoring and enforcement by the California Department of Industrial Relations. Equivalent Securities – Pursuant to California Public Contract Code Section 22300, substitution of eligible and equivalent securities for any moneys withheld to ensure performance under the contract for the work to be performed will be permitted at the request and expense of the successful bidder, unless otherwise prohibited by law. CARB Requirements – The California Air Resources Board (“CARB”) implemented amendments to the In-Use Off-Road Diesel-Fueled Fleets Regulations (“Regulation”) which are effective on January 1, 2024 and apply broadly to all self-propelled off road diesel vehicles 25 horsepower or greater and other forms of equipment used in California. A copy of the Regulation is available at the following link https://ww2.arb.ca.gov/sites/default/files/barcu/regact/2022/off-roaddiesel/appa-1.pdf. Bidders are required to comply with all CARB and Regulation requirements, including, without limitation, all applicable sections of the Regulation, as codified in Title 13 of the California Code of Regulations section 2449 et seq. throughout the duration of the Project. Bidders must provide, with their Bid, copies of Bidder’s and all listed subcontractors’ most recent, valid Certificate of Reported Compliance (“CRC”) issued by CARB. Failure to provide valid CRCs as required herein may render the Bid non-responsive. SAM.gov Registration – The regulations at 2 CFR Part 180 restrict awards, subawards and contracts with certain parties that are debarred, suspended or otherwise excluded from or ineligible for participation in federal assisted program, project, or activities. Bidders must have an active registration on the federal Systems for Awards Management found at SAM.gov. Any Contractors that have been debarred and are listed, will not be eligible to participate. Advertising Dates: SAN GABRIEL VALLEY EXAMINER: Friday, August 16, 2024 Friday, August 23, 2024
STAFF REPORT
ITEM NO. ____10____
TO: Honorable Mayor and Members of the City Council
FROM: Ron Garcia, Director of Community Development
Michelle Bravo, Housing Programs Coordinator
DATE: August 7, 2024
SUBJECT: Approval of a two -year extension of the Affordable Homeownership Expansion Agreement and update to the
Project Activities Implemented by the San Gabriel Valley Habitat for Humanity
SUMMARY
This report seeks City Council approval of a two -year extension of the Affordable Homeownership Expansion Agreement and update to the project activities and associated funding sources to allow completion of grant funded activities.
RECOMMENDATION
Staff recommends that the City Council:
1. Authorize the Chief Executive Officer to approve a no -cost two -year extension of the Affordable Homeownership Expansion Agreement and update to the Project Activities and associated funding sources; and
2. Authorize the Director of Finance to appropriate funding for this updated Program and Project Activities and make the necessary budget adjustment.
FISCAL IMPACT
There is no fiscal impact to the General Fund. The use of funds for this program were authorized by the City Council on July 19, 2023 as shown in the chart below in the discussion section, approving $3,584,659 in funding under the Affordable Homeownership Expansion agreement.
BACKGROUND
On October 6, 2021, the Council approved an Affordable Homeownership Expansion Agreement (“AHEA”) with San Gabriel Valley Habitat for Humanity (”SGV Habitat”) for a term of three (3) years with an optional two-year extension for the purpose of expanding affordable homeownership projects in the City to benefit low -income families. The programs identified included new home construction, acquisition, and rehabilitation of existing homes and/or substantial rehabilitation/critical home repairs for existing homeowners. Low- income families are defined as families that earn 80% or less of the Area Median Income or $100,900 for a family of four. (The median household income in Baldwin Park in 2022 was $76,000. To date, most Baldwin Park applicants to SGV Habitat report a household income between $60,000 and $65,000.)
On February 16, 2022, the City Council approved the form of the agreements to implement an acquisition and rehabilitation housing program to acquire existing homes and rehabilitate them for sale to low-income families (”Affordable Homeownership Expansion Program or ”Program ”) utilizing HOME Investment Partnership Program (“HOME”) Funds.
On August 3, 2022, the City Council also approved the form of the agreements to implement an acquisition and
rehabilitation housing program utilizing Low-Mod funds to acquire existing homes and rehabilitate them for sale to low-income families. The approval of the form and agreements and use of both HOME and Low -Mod funds authorized the CEO to approve real estate purchases and execute the agreements, thus positioning the City to move swiftly in a competitive seller’s market.
On April 5, 2023, SGV Habitat made a presentation updating the City Council on the program and project activities since receiving approval of the Affordable Homeownership Expansion Agreement (“AHEA”) with SGV Habitat.
On July 19th, 2023, the City Council approved an update to the project activities and associated funding sources related to the previously approved Affordable Homeownership Expansion Program with SGV Habitat.
On February 21, 2024, SGV Habitat and staff presented a status update to the City Council on two affordable housing projects located at 12779 Torch Street and 4428 Stewart Avenue.
DISCUSSION
The proposed update to the Program indicates the revised number of units to each respective funding source. The Program will now produce or preserve approximately 12 additional affordable ownership housing units throughout the City. SGV Habitat will continue to complete the following activities as part of the Program:
Fund Sources
Use Key Activity
Total
Units HOME
Low-
Mod ARPA Future Total
Acquisition
Rehab
Home
Renovation/New
Construction 8 284,659 575,000 275,000 - 1,134,659
ADUs
Garage
Conversions/Detac
hed Units 4 - - - 400,000 400,000
Critical
Repairs
Owner Occupied
Rehabilitation
13+13=26
-
-
-
125,000
+
200,000
325,000
Owner Occupied
Rehabilitation
(Senior Veteran)
1 -
-
-
200,000
12779 Torch New Construction 12+1=13 - - 525,000 - 525,000 4288 Stewart New Construction 16-1+15 - - 1,200,000 - 1,200,000 54+12=66 284,659 575,000 2,000,000 725,000 3,584,659
Acquisition-rehabilitation. In April 2024 SGV Habitat completed the first SB9 lot split in the City and the units have been occupied with two eligible first-time homebuyers. Since 2021, housing costs have increased, making it more expensive to acquire land and houses for rehabilita tion. SGV Habitat has consulted with City staff and determined that the remaining unspent funds for acquisition -rehabilitation could be more efficiently used to support the development of more affordable for-sale housing if used to purchase land. Accordingly, SGV Habitat has recently looked at land for sale in the City, with the aim of developing small lot homes as part of a multi-unit site plan.
ADUs. SGV Habitat is completing construction on its first affordable detached ADU in Baldwin Park. SGV Habitat is actively investigating the feasibility of constructing a second detached affordable ADU in Baldwin Park in the very near future. Staff is in the process of working with SGV Habitat to identify garage conversions, and plan to reach out to other homeowners in Baldwin Park about this kind of project in the future.
Owner Occupied Rehabilitation. Thirteen homes have been repaired and completed for income -eligible Baldwin Park homeowners to date. Repairs include replacement of roofs, fences, gutters, garage doors, doors; exterior painting; upgraded electrical or plumbing; accessibility upgrades; an d correcting code enforcement items. SGV Habitat has expended the original allocation of funds for critical home repairs in the Affordable Homeownership Expansion Agreement. One of the homes included a partnership between Oath to Country and SGV Habitat to rehabilitate the home of a Senior Veteran. The rehab of the Senior Veteran home will no longer move forward due to changes in ownership status. Staff is recommending the funds allocated for the veteran home be redirected to complete repairs for approximately 13 homes. As of today, SGV Habitat has a wait list of at least 26 Baldwin Park residents interested in benefiting from the Owner Occupied Rehabilitation Program.
12779 Torch Street. Project plans and tentative tract map have been re -submitted to the City for Design and Plan review. The revised plan calls for 13 units in lieu of the original 12. The project is expected to start construction in January 2025.
4428 Stewart Avenue. Project plans and tentative tract map have been re -submitted to the City for Design and Plan review. The project consists of 11 adaptive reuse units and four more new -construction units on the site of the old Baldwin Park Presbyterian Church. Construction is expected to begin on or about October 1, 2024.
LEGAL REVIEW
This report has been reviewed and approved by the City Attorney as to legal form and content.
ATTACHMENTS
1. Affordable Homeownership Expansion Agreement SGV Habitat
STAFF REPORT
ITEM NO. ___11___
TO: Honorable Mayor and Members of the City Council
FROM: Enrique C. Zaldivar, Chief Executive Officer
Ron Garcia, Director of Community Development
PREPARED BY: Nick Baldwin, City Planner
DATE: August 7, 2024
SUBJECT: Adoption of Resolution No. 2024-038 to Approve Commercial Cannabis Agreement No. 24 -02 and Cannabis Permit
Application No. 23-03 for a New Cannabis Manufacturing and Self-Distribution Business at an Existing Cannabis
Manufacturing Facility within the I, Industrial Zon e
(Location: 15023 Ramona Blvd., APN 8437 -021-006);
Applicant: California Harvest Fund, LLC; Case Number:
CCA 24-02 for CAN 23-03).
SUMMARY
The purpose of this staff report is to consider the approval of a Cannabis Permit Application No. 23 -03 (“Application”, Attachment 3) from California Harvest Fund, LLC, a California limited liability company (“Applicant”), requesting approval to operate a commercial cannabis manufacturing and self-distribution facility at 15023 Ramona Boulevard, Baldwin Park , CA; APN 8437 -021-006 (“Site”) and a proposed Commercial Cannabis Agreement (“CCA”, Attachment 2) No. 24-02 between the City and Applicant related to the conduct of commercial cannabis activity at the Site, which is located within the Industrial (I) Zone.
Per Section 127.08(A) of the Baldwin Park Municipal Code (BPMC), an owner who obtains a permit under this chapter may not sell, transfer, pledge, assign, grant an option, or otherwise dispose of his or her ownership interest in the commercial cannabis production activity covered by any permit issued under BPMC Chapter 127 without a written request deemed appropriate by the Chief Executive Office of the City, or his/her designees, and a fully executed and effective commercial cannabis agreement, approved b y the City Council. This proposal is before the City Council in compliance with this requirement.
RECOMMENDATION
Staff recommends that the City Council:
Adopt Resolution No. 2024 -038 to Approve Commercial Cannabis Agreement No. 24 -02 and Cannabis Permit Application No. 23-03 for a New Cannabis Manufacturing and Self-Distribution Business at an Existing Cannabis Manufacturing Facility within the I, Industrial Zone (Location: 15023 Ramona Blvd., APN 8437 -021-006); Applicant: California Harvest Fund, LLC; Case Number: CCA 24-02 for CAN 23-03).
FISCAL IMPACT
The CCA has a financial component which provides a positive fiscal impact to the City. Under the CCA, the Applicant/operator will pay an annual public benefit fee of $175,000.
Approval of the CCA and Application is also related to the settlement of pending civil litigation between the City and the current owner of the Site, K8 Investor Holdings, LLC, a California limited liability company. Resolving the pending lawsuit will save the City further litigation expenses.
BACKGROUND
In April 2018, the City Council adopted Ordinance No. 1418, to authorize Kultiv8 Group, LLC, a California limited liability company, to conduct commercial cannabis activity (cultivation and manufacturing) at the Site, per Development Agreement (DA) 18-09 (Attachment 4). Subsequently in 2020, Kultiv8 Group, LLC, amended its ownership group and changed the business name to K8. K8 improved and equipped the building at the Site for commercial cannabis activity, but did not receive a Certificate of Occupancy r equired to operate and sell commercial cannabis products at the Site.
On March 31, 2023, K8 filed a civil complaint against the City related to a dispute over nonpayment of public benefit fees, among other things, and the City filed a counterclaim. This litigation is still pending.
On or about November 6, 2023, the City received the Application from Applicant to conduct commercial cannabis activity at the Site (manufacturing and self-distribution). The Application provides that the Site will be purchased by a new property owner, IGF Partners Realty II, LLC, a California limited liability company (“IGF”), and will be managed by a property management company, TREX Real Estate Holdings LLC, a California limited liability company (“TREX”).
On November 15, 2023, the City Council approved a Cannabis Pre -Application Agreement with Applicant and IGF, to expedite review and processing of the Application pending settlement or other disposition of the lawsuit.
City staff has worked with the Applicant to process the Application in accordance with Chapter 127 of the BPMC and the Pre-Application Agreement.
The current owner (K8) and the proposed new owner (IGF) have confirmed their intention to consummate the sale of the property. Meanwhile, City and K8 continued settlement discussions.
On July 17, 2024, the City Council approved a proposed settlement agreement with K8, wherein, among other things, the parties agreed to mutually dismiss the pending litigation, contingent upon satisfaction of certain conditions, including the sale of the Site to IGF and the processing of the Application by the City.
DISCUSSION
Applicant is a cannabis manufacturing company that is wholly owned and solely managed by Jason Turchin, an individual. Per the description of his experience in the Application, Mr. Turchin has had a successful track record of operating cannabis businesses in California, including Zabala Farms, LLC that was valued at $6,000,000. In addition to his experience in the industry, he brings with him two PICC machines that are intricate manufacturing machines valued together at $4,000,000, a $500,000 cash investment, and a pre-approved line of credit.
The business proposes to operate within a one -story, 17,420 square foot industrial building that will have approximately 8,300 square -feet of floor area dedicated to cannabis manufacturing and self -distribution. (See Floor Plan, Attachment 5) The primary type of manufacturing to be done at the facility is extraction of concentrates from the cannabis flower. The balance of the manufacturing area will be dedicated toward infusing foods with cannabis concentrates.
To be eligible to operate a commercial cannabis business in the City, an applicant must meet several regulatory requirements, as set forth in Chapter 127 of the BPMC. One requirement is to clear background checks and Mr.
Turchin, as the sole manager of the b usiness, cleared the background check administered by the City’s Police Department. Another requirement is that an applicant must have possession of the facility to apply for City
approval. The Applicant satisfied the possession requirement by entering into a short-term month-to-month lease via its affiliated property manager, TREX, as Lessee, and the current property owner, K8, as Lessor; and subsequently entering into a sublease b etween TREX, as Sublessor, and Applicant, as Sublessee. The lease and sublease are provided as Attachment 6. If the proposed CCA is approved by the City and the State, and escrow for sale of the Site closes, then a new, long-term lease agreement will be entered into between IGF, as Lessor and TREX, acting as agent for the Applicant, as Lessee. Additional application requirements pertain to zoning compliance, proximity to sensitive users, security plan, business plan, lack of criminal history, regulatory compliance history, good legal standing, community engagement plan, environmental impact, and labor relations.
After review of the Application and all supporting documentation, City Staff finds that the proposal is in substantial compliance with the requir ements set forth in the City’s Commercial Cannabis Ordinance (Chapter 127 of the BPMC) (See Attachment 3, Application).
Upon submittal of the Application, the Applicant paid a one -time deposit for the Cannabis Permit Application review in the amount of $15,000. Pursuant to the CCA, the Applicant also agrees to pay the City $175,000, as the annual public benefit fee, which is subject to reassessment after five (5) years, provided the CCA is renewed as set forth therein.
The CCA has been freely negotiated between the Applicant and the City; the Applicant has agreed that there is no inequality in bargaining power and the CCA is not ambiguous. The Applicant has capacity to read and understand the CCA and has read and understands the terms and conditions therein. The Applicant acknowledges that the CCA is valid and fully enforceable according to its terms.
Approval of the CCA is subject to the following conditions of approval:
1) Close of escrow with IGF acquiring the Site within 30 days. 2) Following close of escrow, Applicant must provide to City a new lease agreement between the new owner, IGF, as lessor, and TREX, acting as agent for Applicant, as lessee. 3) Payment by Applicant of any outstanding fees shall be due before issuance of a certificate of occupancy. 4) That the Applicant must obtain any all applicable City approvals including Building Division, Engineering Division, and LA County Fire, prior to obtaining a business license from the City of Baldwin Park. 5) That the applicant shall defend, ind emnify, and hold harmless the City of Baldwin Park and its officers, employees, and agents from and against any claim, action, or proceeding against the City of Baldwin Park, its officers, employees, or agents to attacks, set aside, void, or annul any appr oval or condition of approval of the City of Baldwin Park concerning this project.
6) That any proposed changes to the approved project shall be considered by the Planning Division, Building Division, Police Department, LA County Health, and LA County Fire, and shall require written authorization of the Community Development Director prior to implementation. 7) That if the Applicant fails to satisfy the conditions of approval as specified above, then the CCA No. 24-02 and Application No. 23-03 shall be null and void.
8) That the Applicant shall sign a notarized affidavit within ten (10) days after the date of the Resolution stating that the Applicant has read and accepts all of the conditions of approval.
CEQA REVIEW
IN ACCORDANCE WITH THE PROVISIONS OF THE CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA), THE CITY HAS DETERMINED THAT THE PROPOSED CCA NO. 24-02 AND CAN 23-03 WILL
NOT HAVE A SIGNIFICANT IMPACT OF THE ENVIRONMENT AND IS CATEGORICALLY EXEMPT PURSUANT TO THE CALIFORNIA CODE OF REGULATIONS, ARTICLE 19, SECTION 15301, CLASS 1, ‘EXISTING FACILITIES.’ FURTHERMORE, THE PROPOSED FACILITY IS WITHIN AN EXISTING
INDUSTRIAL BUILDING, WHICH IS IN CONFORMITY WITH THE CITY PLANNING AND LAND USE REQUIREMENTS, AS SET FORTH IN THE BPMC.
LEGAL REVIEW
This report has been reviewed and approved by the Special Counsel for Commercial Cannabis and the City Attorney, as to legal form and content.
ATTACHMENTS
1. Resolution No. 2024-038
2. Proposed Commercial Cannabis Agreement, CCA 24-02
3. CAN 23-03, Application
4. DA 18-09 existing cannabis facility
5. Floor Plan
6. Short-term Lease and Sublease
65431.00103\42520698.3
Resolution 2024-038
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BALDWIN PARK TO APPROVE COMMERCIAL CANNABIS AGREEMENT 24-02
AND CANNABIS PERMIT APPLICATION NO. 23 -03 FOR A NEW
CANNABIS MANUFACTURING AND SELF -DISTRIBUTION BUSINESS
AT AN EXISTING CANNABIS MANUFACTURING FACILITY WITHIN
THE “I,” INDUSTRIAL ZONE (LOCATION: 15023 RAMONA
BOULEVARD; APN: 8437-021-006); APPLICANT: CALIFORNIA
HARVEST FUND, LLC, CASE NUMBER: CCA 24-02 FOR CAN 23-03).
WHEREAS, California Harvest Fund, LLC, a California limited a liability company, (“Applicant”), submitted a Cannabis Permit Application (CAN 23-03) on November 6, 2023 (“Application”), to the City of Baldwin Park (“City”) for a new cannabis manufacturing and self-distribution business at an existing cannabis manufacturing facility within the Industrial (I) Zone at 15023 Ramona Blvd., Baldwin Park, CA; APN 8437-021-006 (“Site”), pursuant to Chapter 127 of the City of Baldwin Park Municipal Code (“BPMC”); and WHEREAS, the Applicant, as the proposed new cannabis business operator at the Site, and its counsel negotiated a Commercial Cannabis Agreement No. 24-02 (“CCA”) with City in which terms and conditions were mutually agreed upon; and WHEREAS, the purpose and intent of the CCA is to set forth the term s and conditions under which the Applicant will operate a commercial cannabis manufacturing and self-distribution facility, which include, but are not limited to , payment of community benefit fees, and other fees as mutually agreed upon, automatic termination for non - payment of fees, approval of architectural plans (including site plan, floor plan and elevations) to conform with the requirements of the BPMC, and other terms and conditions that will protect and promote the public health, safety, and welfare of all persons in the City, as authorized in Chapter 127 of the BPMC; and
WHEREAS, the Site is currently owned by K8 Investor Holdings, LLC, a California limited liability company (“K8”). K8 obtained substantial land use and entitlement permits from the City but did not open operations for a commercial cannabis business; and WHEREAS, the City and K8 have been involved in litigation since March 2023 and now desire to settle and dismiss the pending litigation pursuant to a settlement agreement separately negotiated between the parties to the lawsuit; and WHEREAS, On November 15, 2023, the City Council approved a Cannabis Pre - Application Agreement with Applicant, to expedite review and processing of the Application pending settlement or other disposition of the lawsuit; and WHEREAS, approval of the CCA and dismissal of the law suit are contingent upon acquisition of the Site by IGF PARTNERS REALTY II, LLC, a California limited liability company (“IGF”), or its assignee, following approval by the City of the Applicant’s cannabis business to operate at the Site , as set forth herein and in the proposed settlement agreement; and
65431.00103\42520698.3
CCA-California Harvest Fund, LLC
Resolution 2024-038
WHEREAS, as a condition to approval of the CCA and following close of escrow, the Applicant, through its affiliated real estate management company, TREX Real Estate Holdings LLC, a California limited liability company , as lessee, will enter into a new lease with IGF, as the new owner/lessor; and
WHEREAS, the CCA has been freely negotiated between the Applicant and the City, and their respective counsel; the Applicant has agreed that there is no inequality in bargaining power and the CCA is not ambiguous. The Applicant has capacity to read and understand the CCA and has read and understands the terms and conditions therein. The Applicant acknowledges that the CCA is valid and fully enforceable according to its terms; and
WHEREAS, in accordance with the provisions of the California Environmental Quality Act (CEQA), the City has determined that the proposed CCA No. 2 4-02 and Application No. 23-03 will not have a significant impact of the environment and is categorically exempt pursuant to the California Code of Regulations, Article 19, Section 15301, Class 1, ‘existing facilities.’ Furthermore, the proposed facility is within an existing industrial building, which is in conformity with the City Planning and Land Use requirements, as set forth in the BPMC.
NOW, THEREFORE, IT BE RESOLVED AS FOLLOWS:
SECTION 1. The above recitals are true and correct and are incorporated herein by this reference.
SECTION 2. The existing commercial cannabis manufacturing and self-distribution facility (collectively, “Project”) that is located at the Site, which is located in the Industrial (I) Zone, is subject to the terms define d in Chapter 127 of the BPMC and will remain unchanged. The proposal is for a new , successor, business to manufacture and self - distribute commercial cannabis products out of the existing facility, which requires approval by the City Council per Section 127.08(A) of the BPMC. Th is Project, which proposes a new business to operate at the existing manufacturing facility , is consistent with the purpose and intent of the BPMC, the Industrial Zone and the General Plan land use designation.
SECTION 3. The City Council has considered the factors for approval described in Section 127.07 of the BPMC and below that are applicable to all Commercial Cannabis manufacturing and distribution applicants subject to a Commercial Cannabis Agreement:
1) For Commercial Cannabis Manufacturing businesses it is required that (i) there is a 600 separation between the business and sensitive receptors like schools or within 50 feet of a residence on a residentially zoned property, (ii) it is located within an Industrial or Indust rial-Commercial zoned property, (iii) all manufacturing occurs indoors, (iv) no more than 22,000 square feet of building area is used toward commercial cannabis activities, (v) it is on a property that is appropriately illuminated, (vi) it is within a properly secured building, (vii) it is in compliance with all applicable state and local laws, (viii) it is properly licensed for use of hazardous 65431.00103\42520698.3
CCA-California Harvest Fund, LLC
Resolution 2024-038
materials, (ix) it is in compliance with the California Fire Code for use of flammable gases, (xi) it is within a sprinklered building, (xii) it is within a building that has proper air filtration, and (xiii) it is in c ompliance with food safety laws. Planning Staff has reviewed the Application and associated documents provided by the Applicant and based on the analysis performed on these documents is satisfied that these requirements have been meet or will be met by the Applicant once the business is in op eration. Per the terms of the Commercial Cannabis Agreement, City Staff reserves the right to inspect operations to verify compliance with the Municipal Code.
2) For Commercial Cannabis Distribution businesses it is required that: (i) the business operate in accordance with MAUCRSA and state regulations, (ii) there be a 600 separation between the business and sensitive receptors like schools or within 24 feet of a residence in a residential zone, (iii) it is compliant with the regulations of the underlying zone, (iv) it is ensured that all manufacturing occurs indoors, (v) no more than 40,000 square feet of building area is used toward commercial cannabis activities, (vi) it is not identifiable from the public right of way as a cannabis business except for approved signs, (vii) it is on a property that is appropriately illuminated, (viii) it is within a properly secured building, (ix) it is in compliance with all applicable state and local laws, (x) it is properly licensed for use of hazardous materials, and (xi) it is within a sprinklered building. P lanning Staff has reviewed the A pplication and associated documents provided by the Applicant and based on the analysis performed on these documents is satisfied that these requirements have been meet or will be met by the Applicant once the business is in operation. Per the terms of the Commercial Cannabis Agreement, City Staff reserves the right to inspect operations to verify compliance with the Municipal Code.
SECTION 4. The City Council hereby approves CCA No. 24-02 and Application No. 23-03 for the proposed commercial cannabis cultivation and manufacturing facility, pursuant to the criteria for approval identified in Section 3 of this Resolution and subject to the following conditions of approval:
1) Escrow for the purchase and sale of the Site with IGF, as buyer, and K8, as seller, must close within 30 days of adoption of this Resolution. 2) Following close of escrow, Applicant must provide to City a new lease agreement between the new owner, IGF, as lessor, and TREX, acting as agent for Applicant, as lessee.
3) Applicant must pay any outstanding fees due before issuance of a certificate of occupancy.
4) That the Applicant must obtain any all applicable City approvals including Building Division, Engineering Division, Police Department, LA County Health, and LA County Fire, prior to obtaining a business license from the City. 5) That the applicant shall defend, indemnify, and hold harmless the City of Baldwin Park and its officers, employees, and agents from and against any claim, action, or proceeding against the City of Baldwin Park, its officers, employees, or agents to attacks, set aside, void, or annul any approval or condition of approval of the City of Baldwin Park concerning this project, including but not limited to any approval or condition of approval of the city council, planning commission, or community 65431.00103\42520698.3
CCA-California Harvest Fund, LLC
Resolution 2024-038
development director . The City shall promptly notify the applicant of any claim, action, or proceeding concerning the project and the City shall cooperate fully in the defense of the matter. The City reserves the right, at its own option, to choose its own attorney to represe nt the City, its officers, employees, and agents in the defense of the matter.
6) That any proposed changes to the approved project shall be considered by the Planning Division, Building Division, Police Department, LA County Health, and LA County Fire, and shall require written authorization of the Community Development Director prior to implementation.
7) That if the Applicant fails to satisfy the conditions of approval as specified above, then the CCA No. 24-02 and Application No. 23-03 shall be null and void. 8) That the Applicant shall sign a notarized affidavit within ten (10) days after the date of this Resolution stating that the Applicant has read and accepts all of the conditions of approval.
SECTION 5. The City Clerk shall certify to the adoption of this Resolution.
PASSED AND APPROVED this 7th day of August 2024.
______________________________________
EMMANUEL J. ESTRADA
MAYOR
[ATTESTATION ON NEXT PAGE]
65431.00103\42520698.3
CCA-California Harvest Fund, LLC
Resolution 2024-038
ATTEST:
STATE OF CALIFORNIA
COUNTY OF LOS ANGELES SS.
CITY OF BALDWIN PARK
I, Christopher Saenz City Clerk, of the City of Baldwin Park, do hereby certify that the foregoing Resolution No. 2024-038 was duly and regularly approved and adopted by the City Council of the City of Baldwin Park at a regular meeting thereof, held on the 7th day of August 2024 by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
________________________________
CHRISTOPHER SAENZ
CITY CLERK
______________________________________________________________________________
COMMERCIAL CANNABIS AGREEMENT
by and between
CITY OF BALDWIN PARK,
a California municipal corporation
and
CALIFORNIA HARVEST FUND LLC,
a California limited liability company
Relating to
Commercial Cannabis Activity – Manufacturing and Self-Distribution
______________________________________________________________________________
COMMERCIAL CANNABIS AGREEMENT
ARTICLE 1. PARTIES AND DATE.
This Commercial Cannabis Agreement (“CCA”) dated ________ ____, 2024 entered into between the CITY OF BALDWIN PARK , a California municipal corporation ("CITY"), and CALIFORNIA HARVEST FUND LLC, a California limited liability company ("LICENSEE").
This CCA shall become effective on the Effective Date defined in Section 3.1.15 below.
ARTICLE 2. RECITALS.
WHEREAS, as prescribed by Chapter 127 of the Baldwin Park Municipal Code (“BPMC”) the CITY permits indoor commercial cultivation, manufacturing, distribution, limited retail, and laboratory testing of cannabis and cannabis products.
WHEREAS, on November 6, 2023, LICENSEE submitted their Commercial Cannabis Permit Application to conduct commercial cannabis activity (manufacturing and self-distribution) in the CITY, pursuant to Chapter 127 of the BPMC and applicable local and state law, rules and regulations, as identified in Attachment No. 3, hereto.
WHEREAS, on November 15, 2023, the LICENSEE, as operator/Lessee and IGF PARTNERS REALTY II, LLC , a California limited liability company (“IGF”), as Lessor (collectively, the “APPLICANTS”), entered into a Cannabis License Pre-Application Agreement (“PRE-APPLICATION”), wherein the CITY agreed to accommodate APPLICANTS in the purchase and sale of the Property , as de scribed in Attachment s 1 and 2, hereto, and to enable LICENSEE to conduct commercial cannabis activity (manufacturing and self-distribution) on the Property;
WHEREAS, in July, 2024, CITY and K8 INVESTOR HOLDINGS, LLC, a Delaware limited liability company, authorized to conduct business in the State of California as a foreign corporation (“K8”), entered into a Settlement Agreement wherein CITY and K8 agreed to mutual dismissals of the pending civil complaints related to the operation of commercial cannabis activity (manufacturing), where IGF will purchase the Property to conduct commercial cannabis activity (manufacturing and self-distribution) and where LICENSEE will be the operator of the commercial cannabis activity at the Property;
WHEREAS, the PARTIES seek to enter into this CCA with the condition precedent that escrow close for the purchase and sale of the Property between IGF, as Buyer, and K8, as Seller, within thirty (30) days of approval of the CCA, by the CITY, and satisfaction of all conditions of approval for any entitlement, permit, or license that LICENSEE seeks from the CITY, as set forth herein.
WHEREAS, by this CCA the Parties wish to set forth terms and conditions for the operation of commercial cannabis activity ( manufacturing and self-distribution) on the Property by LICENSEE as operator/Lessor of the Property.
NOW, THEREFORE , in consideration of the promises, covenants, agreements, and understandings set forth herein, the parties agree as follows:
ARTICLE 3. GENERAL TERMS.
3.1 Definitions and Exhibits . The following terms when used in this CCA shall be defined as follows:
3.1.1 "CCA" means this Commercial Cannabis Agreement.
3.1.2 “Application” means the CITY’s Commercial Cannabis Permit Application (manufacturing and self-distribution), submitted by LICENSEE on November 6, 2023, a copy of which is attached hereto as Attachment No. 3 (proprietary information to be redacted) , in furtherance of this CCA, upon which the CITY has detrimentally relied upon in the processing of the Application and the execution of this CCA.
3.1.3 “BPMC” means Baldwin Park Municipal Code.
3.1.4 “California Cannabis Laws” means “MAUCRSA,” and the regulations adopted and promulgated by the State Licensing Authorities pursuant to “MAUCRSA ,” as such laws and regulations may be amended from time to time.
3.1.5 “Cannabis” means all parts of the plant Cannabis sativa Linnaeus, Cannabis indica, or Cannabis ruderalis, whether growing or not; the seeds thereof; the resin, whether crude or purified, extracted from any part of the plant; and every compound, manufacture , salt, derivative, mixture, or preparation of the plant, its seeds, or resin. "Cannabis" also means the separated resin, whether crude or purified, obtained from cannabis. "Cannabis" also means marijuana as defined by Section 11018 of the Californi a Health & Safety Code. "Cannabis" does not include the mature stalks of the plant, fiber produced from the stalks, oil or cake made from the seeds of the plant, any other compound, manufacture, salt, derivative, mixture, or preparation of the mature stalks (except the resin extracted therefrom), fiber, oil, or cake, or the sterilized seed of the plant which is incapable of germination. For the purpose of this CCA, “cannabis” does not mean industrial hemp as that term is defined by Section 81000 of the Cali fornia Food & Agricultural Code or Section 11018.5 of the California Health & Safety Code.
3.1.6 “Cannabis Product” means cannabis that has undergone a process whereby the plant material has been transformed into a concentrate, including, but not limited to, concentrated cannabis, or an edible or topical product containing cannabis or concentrated cannabis and other ingredients.
3.1.7 “Certificate of Occupancy” (COO) means a document issued by the CITY stating that the Property is suitable for use and occupancy for Commercial Cannabis Activity by the LICENSEE, that it is considered compliant with the building code and safety standards imposed by the CITY , and that the State has issued a commercial cannabis license to the LICENSEE to operate on the Property.
3.1.8 "CITY" means the CITY of Baldwin Park, a California municipal corporation.
3.1.9 "Commercial Cannabis Activity" has the same meaning as that term is defined under MAUCRSA and includes any legal use under MAUCRSA and the BPMC, including without limitation, the cultivation, possession, manufacture, distribution, processing, storing, laboratory testing, packaging, labeling, transportation, delivery, or sale of cannabis and Cannabis Products as regulated under Chapter 5.18 of the BPMC.
3.1.10 "Commercial Cannabis Business License" or “License” means a manufacturing and self -distribution commercial cannabis business permit issued by the CITY pursuant to Chapter 12 7 of the BPMC and this executed CCA, which is required before any Commercial Cannabis Activity may be conducted in the CITY.
3.1.11 Omitted
3.1.12 Omitted.
3.1.13 “Days" mean calendar days unless otherwise specified.
3.1.14. Omitted.
3.1.15 "Effective Date" means the day this CCA is approved and adopted by the City Council of the CITY and signed by the Mayor of the CITY, or his/her designee.
3.1.16 "Existing Land Use Regulations" if and where applicable, means all Land Use Regulations in effect on the Effective Date. Existing Land Use Regulations include all regulations that are a matter of public record on the Effective Date as they may be modified by the Existing Development Approvals.
3.1.17 "Existing Project Approvals" if applicable, means all Project Approvals granted or issued prior to or on the Effective Date. Existing Project Approvals include the approvals, which are a matter of public record prior to or on the Effective Date.
3.1.18 “Fee” means the Public Benefit Fee, also referred to as Community Benefit Fee, to be paid by LICENSEE to CITY pursuant to this CCA, based upon the square feet set forth in the Application.
3.1.19 “Landlord Consent” if applicable, means that the fee simple absolute owner (“Property Owner”) has granted the LICENSEE with written authorization to use the Property for Commercial Cannabis Activity, as set forth in Attachment No. 4, hereto.
3.1.20 “Land Use Regulations" if and where applicable, means all ordinances, resolutions, codes, policies and procedures, adopted by the CITY governing the development and use of land, including the permitted use of land, the density or intensity of use, subdivi sion requirements, the maximum height and size of proposed buildings, the provisions for reservation
or dedication of land for public purposes, and the design, improvement and construction and initial occupancy standards and specifications applicable to the Development of the Property.
3.1.21 “Licensee” has the meaning set forth in the preamble of this CCA, above.
A person who has been issued a commercial cannabis business permit by the CITY, under this chapter for a licensed premise.
3.1.22 Omitted.
3.1.23 “Major Amendment: means an amendment that shall have a material effect on the terms of this CCA which shall require approval by the City Council pursuant to California law.
3.1.24 “Manufacturing” means the process by which the raw agricultural marijuana plant is transformed into finished goods that contain extracted cannabis or non-cannabis ingredients.
3.1.25 “MAUCRSA” means the Medicinal and Adult -Use Cannabis Regulation and Safety Act, codified as Business and Professions Code Section 26000 et seq., as may be amended from time to time.
3.1.26 “Medicinal” with regard to cannabis or Cannabis Products means cannabis or Cannabis Products, respectively, intended to be sold or used for medicinal purposes as set forth in MAUCRSA.
3.1.27 “Minor Amendment” means a clerical amendment to this CCA that shall not materially affect the terms of this CCA and is subject to approval by the Chief Executive Officer.
3.1.28 “Mortgagee" if applicable, means a mortgagee of a mortgage, a beneficiary under a deed of trust or any other security-device lender and its successors-in interest.
3.1.29 "Processing Fees" means the normal and customary application, filing, plan check, permit fees for land use approvals, design review, tree removal permits, building permits, demolition permits, grading permits, and other similar permits and entitlements, an d inspection fees, which fees are charged to reimburse the CITY's expenses attributable to such applications, processing, permitting, review and inspection and which are in force and effect on a general basis at such time as said approvals, permits, review, inspection or entitlements are granted or conducted by the CITY.
3.1.30 "Project" means the development of the Property contemplated by this CCA, as such Project may be further defined, enhanced, or modified pursuant to the provisions of this CCA. The Project shall consist of this CCA, the Application, any and all entitlements, licenses, and permits related to the Project.
3.1.31 "Project Approvals" if applicable, means all other entitlements for the development of the Property in furtherance of the Project, including any and all conditions of approval, subject to approval or issuance by the CITY in connection with Project. "Projec t Approvals" also include both the Existing Project Approvals and the Subsequent Project Approvals approved or issued by the CITY that are consistent with this CCA.
3.1.32 "Project Development" if applicable, includes grading, construction or installation of public and private facilities and the right to maintain, repair or reconstruct any private building, structure, improvement or facility after the construction and comple tion thereof; provided, however, that such maintenance, repair, or reconstruction take place within the Term of this CCA on the Property.
3.1.33 “Project Plan" if applicable, means the Project Approvals and the Existing Land Use Regulations applicable to development of the Property for the Project, as modified and supplemented by Subsequent Project Approvals, as set forth in Attachment No. 6, herein.
3.1.34 "Property" means the real property commonly known as and identified in Attachment No. 1, herein 15023 Ramona Blvd, Baldwin Park, CA 91706 with Access Parcel Number: 8437-021-006 (“APN”), which is incorporated by this reference. LICENSEE may modify the location or locations , change locations, or add locations to the Property , pursuant to Section 127 of the BPMC.
3.1.35 “Reasonable” means using d ue diligence to accomplish a stated objective that the subject party is capable of performing or providing under the circumstances in a manner that is consistent with the intent and objective of the CCA.
3.1.36 “Reservations of Authority" means the rights and authority excepted from the assurances and rights provided to LICENSEE under this CCA and reserved to the CITY as described in Section 4.4.
3.1.37 Self-Distribution” means that a distributor may only transport cannabis goods that the licensee has cultivated or manufactured at the Property.
3.1.38 “State” means, collectively, the State of California and the Department of Cannabis Control of the State.
3.1.39 "Subsequent Project Approvals" if applicable, means all future discretionary approvals and all ministerial Project Approvals required subsequent to the Effective Date in connection with development of the Property, including without limitation, subdivision improvement agreements that require the provision of bonds or other securities. Subsequent Project Approvals include, but are not limited to, all excavation, grading, building, construction, demolition, encroachment, or street improvement permits, occupan cy certificates, utility connection authorizations, or other permits or approvals necessary, convenient, or appropriate for the grading, construction, marketing, use and occupancy of the Project within the Property at such times and in such sequences as LICENSEE may choose consistent with the Project and this CCA.
3.1.40 "Subsequent Land Use Regulations" if applicable, means any Land Use Regulations defined in Section 3.1.12 that are adopted and effective after the Effective Date of this CCA.
3.2 Binding Effect of CCA. The Property is hereby subject to terms and conditions of this CCA. Subject to LICENSEE's receipt of all Development Approvals relative thereto, the Development of the Property is hereby authorized and shall, except as otherwise provided in this CCA, be carried out only in accordance with the terms of this CCA.
3.3 Ownership of Property; Landlord Consent . LICENSEE represents and covenants that it has a legal or equitable interest in the Property, as defined herein. In the event that LICENSEE is not the fee simple absolute owner of the Property, LICENSEE shall provide CITY with written Landlord Consent.
3.4 Term. The parties agree that the Term of this CCA shall be five (5) years commencing on the date the Certificate of Occupancy is issued for the Project subject to the written extension and early termination provisions described in this CCA. Upon termination of this CCA, this CCA shall be deemed terminated and of no further force and effect, except terms that are expressly stated in this CCA to survive termination without the need of further documentation from the parties hereto. The LICENSE will expire at the close of the 5 th year and will require the LICENSEE to reapply with the CITY for a new LICENSE.
3.4.1. CCA Renewal. The Chief Executive Officer (CEO) shall determine whether to renew the CCA for an additional five (5) years. The CEO shall use the CCA Checklist, attached hereto as Attachment No. 10, to determine renewal of the CCA. If the CEO determines to renew, the CCA shall be forwarded to the City Council for formal approval as a consent calendar item.
3.4.2. Non-Renewal of CCA/Cure Period. If the CEO determines not to renew the CCA; he/she shall provide the LICENSEE with ability to remedy and/or cure the deficiencies set forth in the CCA Checklist, attached hereto, to be cured within sixty (60) days from date of written notice of Non-Renewal from the CEO to the LICENSEE. If the LICENSEE does not cure within the sixty (60) day period, the CCA shall not be renewed.
3.4.3. Appeal to the City Council. The LICENSEE shall appeal any Non-Renewal of CCA of the CEO to the City Council, within sixty (60) days from written notice of Non - Renewal. The decision of the City Council re Non-Renewal of CCA shall be final and binding.
3.5 Extension of Term. This CCA may only be extended by mutual agreement of CITY and LICENSEE in writing, following approval by the City Council, and signed by Mayor and the LICENSEE. If the City Council does not approve such an extension, any such agreement is null and void.
3.6 Automatic Termination. This CCA shall automatically terminate upon the happening of any of the following material events:
3.6.1. Revocation of License by the State and/or the CITY, pursuant to the terms in this CCA, which prohibits the LICENSEE from operation of a commercial cannabis facility in
the CITY , following any applicable notice or cure period and provided that LICENSEE has exhausted all administrative remedies and can neither appeal nor reapply for a License within one (1) calendar year of the revocation; or
3.6.2. Abandonment and/or Surrender by LICENSEE of State and/or CITY License, pursuant to the terms in this CCA, which abandons and/or surrenders the License to operate a commercial cannabis manufacturing and self-distribution facility on the SITE, with such abandonment/surrender occurring only following either (1) written notice by LICENSEE affirming its intention to abandon /surrender the License by a date certain, or (2) at least one (1) calendar year of inactivity at the Project, as determined exclusively by the CITY, in good faith.
3.7 Effect of Automatic Termination. The Automatic Termination of this CCA (as set forth in section 3.6, above) shall constitute termination of all land use entitlements and permits approved for the LICENSEE and/or the Property , pursuant to the terms of this CCA. Upon the termination of this CCA, no party shall have any further right or obligation hereunder except with respect to any obligation to have been performed prior to such termination, or with respect to any default in the performance of the provisions of this CCA, which has occurred prior to such termination, or with respect to any obligations which are specifically and expressly set forth as surviving this CCA. In the event of abandonment and/or surrender of License by LICENSEE, LICENSEE shall pay all fees due and payable to the CITY, up to date of abandonment and/or surrender. CITY shall immediately notify the State of any termination of this CCA.
3.8 Notices.
3.8.1 Notice Defined. As used in this CCA, notice includes, without limitation, the communication of notice, request, demand, approval, statement, report, acceptance, consent, waiver, appointment, or other communication required or permitted hereunder.
3.8.2 Written Notice and Delivery . All notices shall be in writing and shall be considered given:
(i) when delivered in person to the recipient named below; or three (3) days after deposit in the United States mail, postage prepaid, addressed to the recipient named below; or
(ii) on the date of personal delivery shown in the records of the delivery company after delivery to the recipient named below; or
(iii) on the date of delivery by facsimile transmission to the recipient named below if a hard copy of the notice is deposited in the United States mail, postage prepaid, addressed to the recipient named below. All notices shall be addressed as follows:
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If to the CITY: Chief Executive Officer
14403 E. Pacific Avenue
Baldwin Park, CA 91706
With copy to:
Office of the City Attorney
14403 E. Pacific Avenue
Baldwin Park, CA 91706
If to LICENSEE:
California Harvest Fund, LLC
15260 Ventura Blvd., 1210
Sherman Oaks, CA 91403
Email: [email protected]
Telephone: (818)-335-3177
Attn: Jason Turchin
With copy to:
Herrera, Clifton, Hess, P.C.
100 Wilshire Blvd., Suite 700
Santa Monica, CA 90401-3602
Email: [email protected]
Telephone: (310) 570-0513
Attn: Alejandro Herrera, Esq.
3.8.3 Address Changes. Either party may, by notice given at any time, require subsequent notices to be given to another person or entity, whether a party or an officer or representative of a party or to a different address, or both. Notices given before actual receipt of notice of change shall not be invalidated by the change.
3.9 Validity of this CCA. LICENSEE and the CITY each acknowledge that neither party has made any representations to the other concerning the enforceability or validity of any one or more provisions of this CCA. The parties acknowledge and agree that neither party shall allege in any administrative or judicial proceeding that the entering into or the performance of any obligations created in this CCA violates federal or state law, with respect to all federal, state, and local statutes, ordinances, or regulations in effect as of the Effective Date.
3.10 Commercial Cannabis Banking. The CITY will not accept cash payments for any fees or costs associated with this CCA. LICENSEE shall establish a banking relationship with a bank that allows for payments to the CITY via company check, cashier’s check, or money order .
Alternatively, LICENSEE, may wire funds and/or ACH directly to the CITY.
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ARTICLE 4. COMMERCIAL CANNABIS PROJECT.
4.1 Right to Develop. LICENSEE shall, subject to the terms of this CCA, develop the Property with a commercial cannabis facility in accordance with and to the extent of the Application. The Property shall remain subject to all Subsequent Project Approvals required to complete the Project as contemplated by the Application.
4.2 Effect of CCA on Land Use Regulations . Except as otherwise provided by this CCA, the rules, regulations and official policies and conditions of approval governing permitted uses of the Property, the density and intensity of use of the Property, the maximum height and size of proposed buildings, and the design, improvement, occupancy and construction standards and specifications applicable to development of the Property shall be the Application. Provided, however, that in approving tentative subdivision maps, the CITY may impose ordinary and necessary dedications for rights-of-way or easements for public access, utilities, water, sewers, and drainage, having a nexus with the particular subdivision; provided, further, that the CITY may impose and will require normal and customary subdivision improvement agreements and commensurate security to secure performance of LICENSEE's obligations thereunder.
4.3 Changes to Project . The parties acknowledge that changes to the Project may be appropriate and mutually desirable. The CITY shall act on such applications, if any, in accordance with the Existing Land Use Regulations, subject to the Reservations of Authority, or except as otherwise provided by this CCA. If approved, any such change in the Existing Development Approvals shall be considered an additional Existing Project Approval.
4.4 Reservations of Authority . Any other provision of this CCA to the contrary notwithstanding, the Project shall be subject to subsequently adopted ordinances, resolutions ("Subsequent Land Use Regulations" or sometimes referred to as "Reservation of Authority") on the following topics:
4.4.1 Processing Fees imposed by the CITY to cover the estimated or actual costs to the CITY of processing applications for the Project or for monitoring compliance with any requirements for approval, granted or issued, which fees are charged to reimburse the CITY's lawful expenses attributable to such applications, proces sing, permitting, review, and inspection and which are in force and effect on a general basis at such time as said approvals, permits, review, inspection, or entitlement are granted or conducted by the CITY.
4.4.2 Procedural regulations relating to hearing bodies, petitions, applications, notices, findings, records, hearings, reports, recommendations, appeals and any other matter of procedure.
4.4.3 Regulations governing engineering and construction standards and specifications including, any and all uniform codes adopted by the State of California and subsequently adopted by the CITY.
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4.4.4 Regulations which may be in conflict with the Development Plan, but which are reasonably necessary to protect the public health and safety; provided, however, the following shall apply:
(a) That to the extent possible, such regulations shall be applied and construed so as to provide LICENSEE with the rights and assurances provided in this CCA. (b) That such regulations apply uniformly to all new development projects of the same uses within the CITY.
4.4.5 Regulations that do not conflict with the Project. The term "do not conflict" means new rules, regulations, and policies which: (a) do not modify the Project, including, without limitation, the permitted land uses, the density or intensity of use, the phasing or timing of the Project, the maximum height and size of propos ed buildings on the Property, provisions for dedication of land for public purposes and Development Exactions, except as expressly permitted elsewhere in this CCA, and standards for design, development and construction of the Project; (b) do not prevent LICENSEE from obtaining any Subsequent Project Approvals, including, without limitation, all necessary approvals, permits, certificates, and the like, at such dates and under such circumstances as LICENSEE would otherwise be entitled by the Project; or (c) d o not prevent LICENSEE from commencing, prosecuting, and finishing grading of the land, constructing public and private improvements, and occupying the Property, or any portion thereof, all at such dates and schedules as LICENSEE would otherwise be entitle d to do so by the Development Plan.
4.4.6 The CITY shall not be prohibited from applying Subsequent Land Use Regulations that do not affect permitted uses of the land, density, design, public improvements (including construction standards and specifications) or the rate of development of the Development, nor shall the CITY be prohibited from denying or conditionally approving any Subsequent Project Applications on the basis of such Subsequent Land Use Regulations.
4.5 Other Public Agencies. It is acknowledged by the parties that other public agencies not within the control of the CITY possess authority to regulate aspects of the Project, separately from or jointly with the CITY, including, but not limited to the Los Angeles County Health Department, the Los Angeles County Fire Department, and the STATE. This CCA does not limit the authority of such other public agencies. The CITY shall reasonably cooperate with such other public agencies processing Project Approvals.
4.6 Tentative Subdivision Map and Project Approvals Lifespan . The term of any tentative subdivision map shall be in effect for a period of fifteen (15) years, and may be extended pursuant to the provisions of the California Subdivision Map Act (Government Code §§ 66410 et seq.) All Project Approvals shall not expire if LICENSEE commences Substantial Construction of the Project within one (1) year from the Effective Date of this CCA, which period shall be tolled during any necessary applications for permits or other local entitlements, that are within the control of the Licensee; otherwise, no tolling period. "Substantial Construction" means the submittal of a building permit in furtherance of the Project.
4.7 Satisfaction of Conditions of Approval. LICENSEE shall comply with any and all conditions of approval for any entitlement, permit, or license it receives from the CITY.
4.8 Subsequent Entitlements. Prior to commencement of construction of the Project, LICENSEE shall be required to submit applications for any and all subsequent entitlements, if any, consistent with the terms and conditions set forth in this CCA.
4.9 CITY Records Inspection. LICENSEE acknowledges and agrees that the CITY is empowered to examine LICENSEE's books and records. The CITY has the power and authority to examine such books and records at any reasonable time, with seventy-two (72) hours written notice, including but not limited to, during normal business hours; provided however, that, should the CITY elect to examine LICENSEE’s books and records more than one (1) time per calendar year, LICENSEE shall only bear the cost of such review in the initial instance, and the costs of any subsequent examination(s) shall be borne solely by the CITY; CITY shall keep all books and records strictly confidential . If the CITY wishes to inspect the areas of the Property where the commercial cannabis is being retailed, CITY may do so at any time with no prior notice to LICENSEE. In addition, CITY agree s that all of its employees or agents which enter the manufacturing facility shall follow all of the policies and guidelines imposed on LICENSEE's employees, including without limitation, the wearing of any clothing or equipment to ensure that no pests or impurities shall enter the manufacturing areas.
4.10 Commencement of Project by LICENSEE . Within six (6) months after the execution of this CCA, LICENSEE shall commence the submittal of applications for and use entitlements, permits, certificate of occupancy, etc. If LICENSEE fails to apply to CITY for entitlements, permits, etc., within six (6) months from the execution of the CCA, CITY shall have the right to Termination of the CCA, and may avail itself of any other remedies, as set forth herein.
The CITY, it its sole and absolute discretion, may grant exte nsions to the LICENSEE to comply with this subsection, provided the LICENSEE demonstrates a good faith attempt to seek entitlements, permits, etc.
ARTICLE 5. PUBLIC BENEFIT S FEE; ADMINISTRATIVE FEE ; JOB CREATION,
AND PERSONAL GUARANTY
5.1 Intent. The parties acknowledge and agree that the Project will result in substantial public needs and further acknowledge and agree that this CCA confers substantial private benefits on LICENSEE, which should be balanced by commensurate public benefits. Accordin gly, the parties intend to provide consideration to the community to balance the private benefits conferred on LICENSEE by providing more fully for the satisfaction of the public needs resulting from the Project. The Parties further acknowledge and agree that the LICENSE confers substantial private benefits on the LICENSEE that will impose burdens on the CITY’s infrastructure, maintenance, repair, safety, services, traffic, noise, pollution, etc., and that the private benefits provided to the LICENSEE should be balanced with commensurate public benefits for the community (“ Public Benefits”).
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5.2 Public Benefits. LICENSEE agrees to provide Public Benefits to the CITY, in compliance with the Public Benefits Plan, as set forth in Attachment No. 8, hereto . All commitments made by LICENSEE in the Application, inclusive of the Public Benefits Plan are incorporated into this CCA as if fully set forth in this CCA. The LICENSEE agrees that the Public Benefits Fee, which has been set by the City Council, is deemed fair and reasonable, and that full payment of such fees is required by LICENSEE under this CCA.
5.3 Penalty for Nonpayment. Failure to pay the Public Benefits Fee within thirty (30) days after the due date shall result in a penalty for nonpayment in a sum equal to twenty-five percent (25%) of the total amount due. Additional penalties will be assessed in the following manner: ten percent ( 10%) shall be added to the first day of each calendar month following the month of the imposition of the twenty-five (25%) penalty if the fees remain unpaid in whole or in part – up to a maximum of 100% of the fee payable on the due date.
5.4 Annual Public Benefits Fee. LICENSEE agrees to pay the CITY an annual Public Benefits Fee in the amount of one-hundred seventy five thousand dollars ($175,000.00), which is based upon the square feet set forth in the Application and the “Premises” as defined by the State.
5.5 Public Benefits Fee Schedule. LICENSEE shall commence payment of the Public Benefits Fee to the CITY six months after issuance of the Certificate of Occupancy (COO), from the CITY or, within twelve (12) months from the execution date of this CCA, whichever occurs first (“Fee Commencement Date”) . Thereafter the Public Benefits Fee shall be payable on an annual basis on the anniversary date of the Fee Commencement Date.
5.6 Reassessment of Public Benefits Fee . The Public Benefits Fee is subject to reassessment by the CITY every five (5) years, after execution of this CCA. At the end of year five (5), the CITY will set a new Public Benefits Fee which will be applied in years 6 through 10.
At the end of year 10, the CITY will set new Public Benefits Fee which will be applied in years 11 through 15. No one factor is dispositive in the CITY’s determination of the new Public Benefits Fee.
5.7. Administrative Fee Deposit . The Administrative Fee is a regulatory fee that LICENSEE shall be responsible to compensate the CITY for all of the CITY's Reasonable costs associated with processing, issuance and compliance of the Project Approvals including, but not limited to, costs associated with the CITY's review , processing, performing investigations, inspections, and audits, administrative enforcement of this CCA an adjudication thereof including, but not limited to , staff review of Project entitlements, including all environmental clearance documents, permits, licenses and all documents evidencing compliance with state and local law , and consultant and City Attorney Fees. As such, upon submittal of the application to the CITY for Project entitlements, LICENSEE must make an initial deposit of Fifty thousand and 00/100 dollars ($50,000.00) with the CITY for the purpose of reimbursing the CITY for any Reasonable costs associated with the Project, as detailed above and reimbursing the CITY for its Reasonable costs incurred in drafting and processing this CCA. LICENSEE will be liable for the CITY's Reasonable costs incurred in processing future Project approvals and/or applications and compliance by the State or the CITY . CITY acknowledges and agrees that this payment is only a deposit and LICENSEE will be requested to deposit additional funds as needed in increments of Five Thousand
Dollars ($5,000.00). LICENSEE agrees that this Administrative Fee is not a tax, but a fee for cost- of-service (see California Constitution, Article XIIIC).
5.8. Project Plan. LICENSEE shall provide a detailed Project Plan if LICENSEE has not already submitted a Project Plan in its Business Plan as part of its CITY Cannabis Permit Application Form.
5.9 Financial Projections . Three (3) years of Financial Projections will be provided with the CCA. Thereafter annual Financial Projections will be provided on the anniversary of the execution of this CCA, as set forth in Attachment No. 7, herein.
5.10 Jobs and Wage Creation.
5.10.1. Local Hiring. LICENSEE agrees to use its Reasonable, good faith efforts to hire qualified CITY residents for jobs at the Project. LICENSEE shall also use Reasonable efforts to retain the services of qualified contractors and suppliers who are located in the CITY or who employ a significant number of CITY residents. The LICENSEE shall comply with the living wage requirement for all employees at the commercial cannabis facility. Unions shall be allowed, and LICENSEE shall not discriminate against such union activity.
5.10.2. Wage Creation. LICENSEE shall make Reasonable, good faith efforts to employ at least forty percent (40%) of the Project’s workforce consisting of CITY residents. Such Reasonable, good faith efforts shall include, without limitation, job announcements posted at CITY Hall, along with proof that the job announcements were advertised in at least two (2) newspapers published, printed, or distributed in the CITY and , is applicable, on various social media sites accessible to the general public. In addition, LICENSEE shall make a good faith effort to advertise job announcements at local job fairs and/or on local radio and use any other medium to advertise job announcements to the broadest audience possible.
5.10.3. Status Reports. LICENSEE shall provide the CITY with written annual status reports to monitor compliance with this Section 5. 10. Status Report Form to be provided by CITY.
5.11. Penalty for Nonpayment. Failure to pay the quarterly installment fees within thirty (30) days after the due date shall result in a penalty for nonpayment in a sum equal to twenty-five (25%) of the total amount due. The CITY may use all available legal means to collect any unpaid quarterly installment fees, inlcuding, but not limited to contracting with collection agencies, encumvrance of the Licensee’s real property, and seeking judgment in court; any unpaid balance will be subject to an additional collection fee of nineteen percent (19%).
5.12. Personal Guaranty. LICENSEE shall execute a Personal Guaranty , as set forth in Attachment No. 5, hereto, in favor of the CITY to secure the payment of all fees associated with this CCA. The initial amount of the Personal Guaranty shall be Two-Hundred Thousand Dollars ($200,000.00).
5.13 Nexus/Reasonable Relationship Challenges. LICENSEE agrees that the terms and conditions, the Public Benefit Fees, and the Administrative Fees imposed in this Article V, are in fact reasonable and related to the amelioration of the negative impacts of the Project on the CITY and consents to, and waives any rights it may have now or in the future to challenge the legal validity of, the conditions, requirements, policies or programs set forth in this CCA including, without limitation, any claim that the terms in this CCA constitute an abuse of the p olice power, violate substantive due process, deny equal protection of the laws, effect a taking of property without payment of just compensation, and/or impose an unlawful tax.
ARTICLE 6. DISTRIBUTION AND TRANSPORTATION
6.1 Transportation of Commercial Cannabis. Transfers of commercial cannabis goods into and out of the CITY may be completed by a duly licensed commercial cannabis distributor in compliance with MAUCRSA and the BPMC.
6.2 Distribution of Commercial Cannabis. LICENSEE shall distribute its commercial cannabis and commercial Cannabis Products through any duly licensed commercial cannabis distributor in compliance with MAUCRSA and the BPMC.
6.3 Agreement with Distributor(s). LICENSEE and any distributors shall reach their own agreement regarding fees for the distributor’s services, if applicable.
6.4. Self-Distribution. LICENSEE may engage in “Self-Distribution” of commercial cannabis products that are cultivated or manufactured on the Property for a period of five (5) years, provided LICENSEE pays an annual fee of ten thousand dollars ($10,000.00) to the CITY in annual installments of two thousand dollars ($2,000.00), for five (5) years, or one ten thousand dollars ($10,000.00) payment. LICENSEE shall also maintain current a distributor transport permit from the State of California and comply with MAUCRSA and the BPMC. A distributor transport only self-distribution licensee is not permitted to transport cannabis goods cultivated or manufactured by other licensees in the CITY or elsewhere.
ARTICLE 7. REVIEW FOR COMPLIANCE.
7.1 Periodic Review. The CITY Council shall have the option, in its sole and absolute discretion, to direct the Chief Executive Officer to review this CCA once every calendar year, on or before each anniversary of the Effective Date, in order to ascertain LICENSEE's good faith compliance with this CCA. During the Periodic Review, LICENSEE shall be required to demonstrate good faith compliance with all the terms and conditions of the CCA including good faith towards getting a Certificate of Occupancy.
7.2 Special Review. The CITY Council, in its sole and absolute discretion, may order a special review of compliance with this CCA by the Chief Executive Officer at any Reasonable time if the Chief Executive Officer is informed and believes that LICENSEE is in default o f any terms and conditions of the CCA. The CITY may also inspect any Property of the LICENSEE associated with the Project, at any time without notice. The failure by LICENSEE to allow entry
into the Property or Properties, at any time, shall be deemed a breach of this CCA and may result in the termination of this CCA, as originally agreed, or as modified.
7.3 Review Hearing. At the time and place set for the review hearing before the Chief Executive Officer, LICENSEE shall be given an opportunity to be heard. If the Chief Executive Officer finds, based upon substantial evidence, that LICENSEE has not complied in good faith with the terms or conditions of this CCA, the Chief Executive Officer may: (a) recommend that the City Council terminate this CCA notwithstanding any other provision of this CCA to the contrary, or (b) modify this CCA and impose such conditions as are reasonably necessary to protect the best interests of the CITY , with any Minor Amendment to this CCA approved by the Chief Executive Officer, and any Major Amendment to this CCA approved by the City Council. After the Review Hearing, the decision of the Chief Executive Officer shall be appealable to the City Council of the CITY . Any appellate decision of the City Council shall be final, subject only to judicial review.
7.4 Certificate of Compliance . If, at the conclusion of a periodic or special review following a LICENSEE’s default , the Chief Executive Officer determines that LICENSEE is in compliance with this CCA, the CITY shall issue a Certificate of Compliance ("Certificate") to LICENSEE stating that after the most recent Periodic Review or Special Review and based upon the information known or made known to the Chief Executive Officer , that (a) this CCA is reinstated in full force and effect and (b) LICENSEE is not in default. The CITY shall not be bound by a Certificate if a default existed at the time of the Periodic Review or the Special Review, but wa s not disclosed, concealed, or otherwise not known to the City Council of the CITY, regardless of whether the Certificate is relied upon by assignees or other transferees or LICENSEE.
7.5 Failure to Conduct Review . The CITY's delay or failure to conduct a Periodic Review or a Special Review of this CCA shall not constitute a breach of this CCA.
7.6 Cost of Review . The costs incurred by CITY in connection with the Periodic Reviews or Special Review shall be borne by the CITY. The LICENSEE is not liable for any costs associated with any CITY Periodic Review or Special Review of this CCA.
ARTICLE 8. EVENTS OF DEFAULT.
8.1 Material Breach of this CCA. Any of the following events shall be deemed an Event of Default and a material breach of this CCA:
8.1.1 Final Judgment. The entry of a final judgment (or a decision on any appeal therefrom) voiding the CITY's General Plan or any element thereof, which judgment or decision would preclude development of the Project, but only if the CITY is unable to cure such defect in the General Plan or element within one hundred and eighty (180) days from the later of entry of final judgment or decision on appeal.
8.1.2 Payment of Fees. Failure to timely pay any fees to the CITY, as determined by the CITY in its sole and absolute discretion.
8.1.3 Land u se entitlements, permits . Failure to apply for land use entitlements, permits, with the CITY and the State of California, Department of Cannabis Control, within six (6) months after execution of this CCA. The CITY will grant extensions upon written request and proof of progress in seeking entitlements, permits, etc.
8.1.4 Certificate of Occupancy. Failure to move forward in good faith to obtain a Certificate of Occupancy (COO) on a timely basis.
8.1.5 Cure Period. In the event of any material breach of this CCA, the CITY shall mail a notice to LICENSEE, offering an opportunity to cure the breach, within sixty (60) days. Proof of the cure of the event MUST be presented within the sixty (60) days to CITY; provided, however, that if such material breach is capable of being cured but is of such a nature that it cannot be cured within said time period, then CITY shall not be entitled to terminate this CCA so long as Licensee is working diligently and in good faith to cure such breach, as determined by CITY in its sole and absolute discretion. Failure to cure within the time set forth herein, shall be grounds for Termination as set forth in Section 3. 7, above, at the discretion of the CITY .
LICENSEE shall only be entitled a ten (10) day cure period for Automatic Termination as set forth in Section 3.6, above.
ARTICLE 9. REMEDIES.
9.1 Remedies in General . It is acknowledged by the parties that the CITY would not have entered into this CCA if it were to be liable in damages with respect to this CCA or the Application thereof, except as hereinafter expressly provided. Subject to extensions of time by mutual consent in writing, failure, or delay by either party to perform any term or provision of this CCA shall constitute a default.
9.2 Event of Default. In the event of alleged default or breach of any terms or conditions of this CCA, the party alleging such default or breach shall give the other party thirty (30) days' notice in writing specifying the nature of the alleged default and the manner in which said default may be satisfactorily cured during any such sixty (60) day period, the party charged shall not be considered in default for purposes of termination or institution of legal proceedings, except for the events detailed in Section 3.6, above, wherein a ten (10) day notice to cure is required.
9.3 Legal or Equitable; Monetary Damages. In general, each of the parties hereto may pursue any remedy at law or equity available for the breach of any provision of this CCA through any state court, except that the CITY shall not be liable in monetary damages, unless expressly provided for in this CCA, to LICENSEE, to any mortgagee or lender, or to any successors in interest of LICENSEE , if successors in interest are permitted under this CCA or mortgagee or lender, or to any other person, and LICENSEE covenants on behalf of itself and all successors in interest, if successors in interest are permitted under this CCA, to the Property or any portion thereof, not to sue for damages or claim any damages:
(i) For any breach of this CCA or for any cause of action which arises out of this CCA; or
(ii) For the impairment or restriction of any right or interest conveyed or provided under, with, or pursuant to this CCA, including, without limitation, any impairment or restriction which LICENSEE characterizes as a regulatory taking or inverse condemnation; or
(iii) Arising out of or connected with any dispute, controversy or issue regarding the Application or request for a permit for manufacturing or interpretation or effect of the provisions of this CCA.
9.4 Waiver/Release of Claims. LICENSEE hereby agrees to waive and/or release the CITY for any claim or claims or cause of action, not specifically and expressly reserved herein, which LICENSEE may have at the time of execution of this CCA relating to any Application to the CITY including, but not limited to, any Application for any type of manufacturing permit, any Application for any manufacturing rights, or any Application for manufacturing license from the CITY.
CALIFORNIA CIVIL CODE SECTION 1542
The LICENSEE expressly acknowledges that this CCA is intended to include in its effect, a waiver without limitation, of all claims or causes of actions which have arisen and of which each side knows or does not know, should have known, had reason to know or suspects to exist in their respective favor at the time of execution hereof, that this CCA contemplates the extinguishment of any such Claim or Claims. The LICENSEE specifically acknowledges and waives and releases the rights granted to LICENSEE under California Civil Code Section 1542 , which states as follows:
A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party.
By expressly waiving the rights granted to LICENSEE under California Civil Code Section 1542, the LICENSEE represents that they understand and acknowledge that if they have suffered any injury, damage as a result of the Application for or request for any permit from the CITY and (i) they are not presently aware of any damage or injury, or (ii) any damage or injury has not yet manifested itself, any claims for any such damage or injury are forever released and discharged.
9.5 Reservation of Rights – CITY. Nothing herein shall modify or abridge any defenses or immunities available to the CITY and its employees pursuant to the Government Tort Liability Act and all other applicable statutes and decisional law.
9.6 Reservation of Rights – LICENSEE. Nothing contained herein shall modify or abridge LICENSEE's rights or remedies (including its rights for damages, if any) resulting from the exercise by the CITY of its power of eminent domain. Nothing contained herein shall modify or abridge LICENSEE's rights or remedies (including its rights for damages, if any) resulting from the grossly negligent or malicious acts of the CITY and its officials, officers, agents, and employees.
9.7 Limitation of Rights . Except as set forth in the preceding paragraph relating to eminent domain, LICENSEE's remedies shall be limited to those set forth in this Section 9.1, Section 9.2, and Section 9.3.
9.8 Specific Performance. The parties acknowledge that money damages and remedies at law are inadequate, and specific performance and other non -monetary relief are particularly appropriate remedies for the enforcement of this CCA and should be available to all parties for the following reasons:
(i) Except as provided in Section 9.1, money damages are unavailable against the CITY.
(ii) Due to the size, nature, and scope of the Project, it may not be practical or possible to restore the Property to its natural condition once implementation of this CCA has begun. After such implementation, LICENSEE may be foreclosed from other choices it may have had to use the Property or portions thereof. LICENSEE has invested significant time and resources and performed extensive planning and processing of the Projec t in agreeing to the terms of this CCA and will be investing even more significant time a nd resources in implementing the Project in reliance upon the terms of this CCA, and it is not possible to determine the sum of money which would adequately compensate LICENSEE for such efforts; the parties acknowledge and agree that any injunctive relief may be ordered on an expedited, priority basis.
9.9 Termination of CCA for Default by CITY. LICENSEE may terminate this CCA only in the event of a default by the CITY in the performance of a material term of this CCA and only after providing written notice to the CITY of default setting forth the nature of the default and the actions, if any, required by the CITY to cure such default and, where the default can be cured, the CITY has failed to take such actions and cur e such default within sixty (60) days after the effective date of such notice or, in th e event that such default cannot be cured within such sixty (60) day period but can be cured within a longer time, has failed to commence the actions necessary to cure such default within such sixty (60) day period and to diligently proceed to complete suc h actions and cure such default.
9.10 Attorneys' Fees and Costs . In any action or proceeding between the CITY and LICENSEE brought to interpret or enforce this CCA, or which in any way arises out of the existence of this CCA, or is based upon any term or provision contained herein, the "prevailing party" in such action or proceeding shall be entitled to recover from the non -prevailing party, in addition to all other relief to which the prevailing party may be entitled pursuan t to this CCA, the prevailing party's Reasonable attorneys' fees and litigation costs, in an amount to be determined by the court. The prevailing party shall be determined by the court in accordance with California Code of Civil Procedure Section 1032. Fees and costs recoverable pursuant to this Section 8.10 include those incurred during any appeal from an underlying judgment and in the enforcement of any judgment rendered in any such action or proceeding.
9.11 LICENSEE Default . No building permit shall be issued or building permit application accepted for any structure on the Property after LICENSEE is determined by the CITY
to be in default of the terms and conditions of this CCA until such default thereafter is cured by LICENSEE or is waived by the CITY. If the CITY terminates this CCA because of LICENSEE'S default, then the CITY shall retain any and all benefits, including fees received by the CITY hereunder.
9.12 Additional Fees and Fines. LICENSEE shall be subject not only to the Fees due, as set forth in the CCA, but shall also be subject to an additional Collections Fee in the amount of the legal rate of interest is 10% of outstanding balance due to the CITY, which shall be due to the Collections Agency designated by the CITY for any and all collections efforts initiated by the CITY, if payment is not received within thirty (30) days after request from the CITY’s designated collections agency.
9.13 Termination by CITY . Upon default by L ICENSEE, the CITY may, i n its sole discretion, terminate this CCA and may, in its sole discretion and following a Review Hearing pursuant to Section 7.3 and the applicable appeal referenced therein, report said termination to the Department of Cannabis Control of the State of California (DCC).
ARTICLE 10. THIRD PARTY LITIGATION.
10.1 General Plan Litigation. The CITY has determined that this CCA is consistent with its General Plan. LICENSEE has reviewed the General Plan and concurs with the CITY's determination. The CITY shall have no liability under this CCA, or otherwise, for any failure of the CITY to perform under this CCA, or for the inability of LICENSEE to develop the Property as contemplated by the Project Plan, which failure to perform or inability to develop is as the result of a judicial determination that the General Plan, or portions thereof, are invalid, inadequate, not in compliance with law, or that this CCA or any of the CITY's actions in adopting it, were invalid, inadequate, or not in compliance with law. Notwithstanding the foregoing, neither party shall contend in any administrative or judicial proceeding that the CCA or any Project Approval is unenforceable based upon federal, state, or local statutes, ordinances, or regulations in effect on the Effective Date.
10.2 Hold Harmless Agreement. LICENSEE hereby agrees to, and shall hold CITY, its elective and appointive boards, commissions, officers, agents, and employees harmless from any liability for damage or claims for damage for personal injury, including death, as well as from claims for property damage which may arise from LICENSEE or LICENSEE's contractors, subcontractors, agents, or employees operations under this CCA, whether such operations be by LICENSEE, or by any of LICENSEE's contractors, subcontractor s, agents, or employees operations under this CCA, whether such operations be by LICENSEE, or by any of LICENSEE's contractors, subcontractors, or by any one or more persons directly or indirectly employed by, or acting as agent for LICENSEE or any of LICENSEE's contractors or subcontractors. LICENSEE agrees to and shall defend CITY and its elective and appointive boards, commissions, officers, agents and employees from any suits or actions at law or in equity for damage caused, or alleged to have been caused, by reason of any of the aforesaid operations.
10.3 Indemnification. LICENSEE shall defend, indemnify and hold harmless the CITY and defend its officers, agents, and employees, against and from any and all liabilities, demands,
lawsuits, claims, government claims, actions or proceedings and costs and expenses incidental thereto (including costs of defense, settlement and Reasonable attorneys' fees), which the CITY, its officers, agents, and employees, may suffer, incur, be responsible for or pay out as a result of or in connection with any challenge to the legality, validity or adequacy of any of the following:
(i) this CCA and the concurrent and subsequent permits, licenses and entitlements approved for the Project or Property; (ii) if applicable, the environmental impact report, mitigated negative declaration or negative declaration, as the case may be, prepared in connection with the development of the Property; and (iii) the proceedings or procedure undertaken in connection with the adoption or approval of any permit or any of the above. In the event of any legal or equitable action or other proceeding instituted by anyone against the CITY, its officers, agents, and employees, and any third party (including a governmental enti ty or official) challenging the validity of any provision of this CCA or procedure upon which the permit was issued, or any portion thereof as set forth herein, the parties shall mutually cooperate with each other in defense of said action or proceeding. Notwithstanding the above, the CITY, at is sole option, may tender to LICENSEE, and LICENSEE agrees to accept any such tender of the complete defense, of any third-party challenge as described herein. In the event the CITY elects to contract with special counsel to provide for such a defense, the CITY may do so in its sole discretion and LICENSEE will be required to pay the defense costs of the CITY as the costs are incurred. LICENSEE agrees to pay any and all attorney's fees or retainer regarding the select ion of special counsel, and LICENSEE shall pay all costs and all attorneys' fees related to retention of such special counsel.
10.4 Environmental Contamination. LICENSEE shall indemnify and hold the CITY, its officers, agents, and employees, free and harmless from any liability, based or asserted, upon any act or omission of the LICENSEE, its officers, agents, employees, subcontractors, predecessors in interest, successors, assigns and independent contractors, excepting any acts or omissions of CITY as successor to any portions of the Property dedicated or transferred to CITY by LICENSEE, for any violation of any federal, state, o r local law, ordinance or regulation relating to industrial hygiene or to environmental conditions on, under or about the Property, including, but not limited to, soil and groundwater conditions, and LICENSEE shall defend, at its expense, including attorneys' fees, the CITY, its officers, agents, and employees, in any action based or asserted upon any such alleged act or omission. The CITY may in its discretion participate in the defense of any such claim, action or proceeding. The provisions of this Section 10.4 do not apply to environmental conditions that predate the LICENSEE's ownership or control of the Property or applicable portion, which shall be determined exclusively by the CITY. However, the foregoing limitation shall not operate to bar, limit, or modif y any of LICENSEE's statutory or equitable obligations as either a LICENSEE or seller of the Property.
10.5 CITY Selection of Counsel. With respect to Sections 10.1 through 10.4, the CITY reserves the right to select its own special counsel or otherwise engages special counsel to defend the CITY hereunder, which fees shall be paid by LICENSEE.
10.6 Acceptance of Reasonable, Good Faith Settlement. With respect to this Article 10, the CITY shall not reject any Reasonable, good faith settlement. Before accepting any such settlement offer, CITY shall notify LICENSEE of the offer and provide LICENSEE with a copy of the settlement offer. If LICENSEE disagrees with the CITY's intention to accept the offer, prior
to the CITY's response to any offer, the parties shall meet and confer, in good faith, in order to attempt to resolve the parties' differences. If the CITY does reject a Reasonable, good faith settlement that is acceptable to LICENSEE, LICENSEE may enter into a settlement of the action, as it relates to LICENSEE, and the CITY shall thereafter defend such action (including appeals) at its own cost and be solely responsible for any judgments rendered in connection with such action.
This Section 9.6 applies ex clusively to settlements pertaining to monetary damages or damages which are remedial by the payment of monetary compensation. LICENSEE and the CITY expressly agree that this Section 9.6 does not apply to any settlement that requires an exercise of the CITY's police powers, limits the CITY's exercise of its police powers, or affects the conduct of the CITY's municipal operations.
10.7 Administrative Actions. The parties acknowledge that in the future there could be claims, enforcement actions, requests for information, subpoenas, criminal or civil actions initiated or served by either the Federal Government or the State Government in connection with LICENSEE's development, operation, and use of the Property (collectively, "Actions"). The CITY shall not disclose information and documents to the Federal Government or State Government, its officers, or agents regarding any party to this CCA absent a grand jury s ubpoena, civil or administrative subpoena, warrant, discovery request, summons, court order or similar process authorized under law hereinafter called "Governmental Notice." If any Action is brought by either the Federal or State Government, CITY shall im mediately notify LICENSEE of the nature of the Claim including all correspondence or documents submitted to the CITY. Prior to responding to the Governmental Notice, CITY shall provide LICENSEE ten (10) days from the date of such notice subpoena or the like to serve and obtain on the CITY a protective order, or the like, from a court of competent jurisdiction.
10.8 Survival. The provisions of Sections 10.1 through 10.7 inclusive, shall survive the termination or expiration of this CCA, until such time as the uses of the Property established in the Development Plan are permanently terminated.
ARTICLE 11. THIRD PARTY LENDERS, ASSIGNMENT & SALE.
11.1 Encumbrances. The parties hereto agree that this CCA shall not prevent or limit LICENSEE, in any manner, at LICENSEE's sole discretion, from encumbering the Property or any portion thereof or any improvement thereon by any mortgage, deed of trust or other security device securing financing with respect to the Property.
11.2 Lender Requested Modification/Interpretation. The CITY acknowledges that the lenders providing such financing may request certain interpretations and modifications of this CCA and agrees upon request, from time to time, to meet with LICENSEE and representatives of such lenders to negotiate in good faith any such request for interpretation or modification. The CITY will not unreasonably withhold its consent to any such requested interpretation or modification provided such interpretation or modification is consistent with the intent and purposes of this CCA and as long as such requests do not minimize, reduce, curtail, negate or in any way limit CITY’s rights under this CCA.
11.3 Non-Transferable Without CITY Approval. LICENSEE shall not sell or transfer its right, title and interest in this CCA and any permits, licenses, entitlements, and related benefits , except in full compliance with the transferability provisions in Chapter 128 of the BPMC.
ARTICLE 12. MISCELLANEOUS PROVISIONS.
12.1 Amendment of CCA. This CCA shall be amended only by mutual consent of the Parties. All amendments shall be in writing and executed by both Parties. The City Council hereby expressly authorizes the Chief Executive Officer to approve a Minor Amendment to this CCA. A Major Amendment to this CCA shall be approved by the City Council. The Chief Executive Officer shall, on behalf of CITY, have sole discretion to determine if an amendment constitutes a Minor Amendment or a Major Amendment. Nothing in this CCA shall be construed as requiring a noticed public hearing, unless required by law.
12.2 Entire Agreement. This CCA sets forth and contains the entire understanding and agreement of the parties, and there are no oral or written representations, understandings or ancillary covenants, undertakings or agreements that are not contained or expressly contained herein.
12.3 Severability. If any term, provision, covenant, or condition of this CCA shall be determined invalid, void, or unenforceable, by a court of competent jurisdiction, the remainder of this CCA shall not be affected thereby and shall remain in full force and effect to the extent such remaining provisions are not rendered impractical to perform taking into consideration the purposes of this CCA.
12.4. Federal Law. The Parties expressly agree that each Party is strictly prohibited from failing to perform any and all obligations under this CCA on the basis that this CCA is invalid, unenforceable, or illegal under federal law. By entering into this CCA, each Party disclaims any right to tender an affirmative defense in any arbitration or court of competent jurisdiction, that performance under this CCA is not required because the CCA is invalid, unenforceable, or illegal under federal law.
12.5 Interpretation and Governing Law. Any dispute arising hereunder shall be governed and interpreted in accordance with the laws of the State of California. This CCA shall be construed as a whole according to its fair language and common meaning to achieve the objectives and purposes of the parties hereto, and the rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be employed in interpreting this CCA, since all parties were represented by counsel in the negotiation and preparation of this CCA, and/or were advised to consult counsel and had the opportunity to obtain counsel for the negotiation and preparation of this CCA.
12.6 Section Headings . All section headings and subheadings are inserted for convenience only and shall not affect any construction or interpretation of this CCA.
12.7 Singular and Plural; Gender, and Person . Except where the context requires otherwise, the singular of any word shall include the plural and vice versa, and pronouns inferring
the masculine gender shall include the feminine gender and neuter, and vice versa, and a reference to "person" shall include, in addition to a natural person, any governmental entity and any partnership, corporation, joint venture or any other form of Project entity.
12.8 Time of Essence . Time is of the essence in the performance of the provisions of this CCA as to which time is an element.
12.9 Waiver. Failure by a party to insist upon the strict performance of any of the provisions of this CCA by the other party, or the failure by a party to exercise its rights upon the default of the other party, shall not constitute a waiver of such party's right to insist and demand strict compliance by the other party with the terms of this CCA thereafter.
12.10 No Third-Party Beneficiaries. The only parties to this CCA are LICENSEE and the CITY. This CCA is made and entered into for the sole protection and benefit of the parties and their successors and assigns. There are no third-party beneficiaries, and this CCA is not intended, and shall not be construed, to benefit, or be enforceable by any other person whatsoever.
12.11 Mutual Covenants. The covenants contained herein are mutual covenants and also constitute conditions to the concurrent or subsequent performance by the party benefited thereby of the covenants to be performed hereunder by such benefited party.
12.12 Counterparts. This CCA may be executed by the parties in counterparts, which counterparts shall be construed together and have the same effect as if all of the parties had executed the same instrument.
12.13 Jurisdiction and Venue. Any action at law or in equity arising under this CCA or brought by a party hereto for the purpose of enforcing, construing or determining the validity of any provision of this CCA shall be filed and prosecuted in the Superior Court of the County of Los Angeles, State of California, and the parties hereto waive all provisions of federal or state law or judicial decision providing for the filing, removal or change of venue to any other state or federal court, including, without limitation, Code of Civil Procedure Section 394.
12.14 Project as a Private Undertaking . It is specifically understood and agreed by and between the parties hereto that the development of the Project is a private development, that neither party is acting as the agent of the other in any respect hereunder, and that each party is an independent contracting entity with respect to the terms, covenants and conditions contained in this CCA. No partnership, joint venture or other association of any kind is formed by this CCA.
The only relationship between the CITY and LICENSEE is that of a government entity regulating the development of private property and the LICENSEE of such property.
12.15 Further Actions and Instruments. Each of the parties shall cooperate with and provide Reasonable assistance to the other to the extent contemplated hereunder in the performance of all obligations under this CCA and the satisfaction of the conditions of this CCA.
Upon the request of either party at any time, the other party shall promptly execute, with acknowledgment or affidavit if reasonably required, and file or record such required instruments and writings and take any actions as may be reasonably necessary under the terms of this CCA to
carry out the intent and to fulfill the provisions of this CCA or to evidence or consummate the transactions contemplated by this CCA.
12.16 Eminent Domain. No provision of this CCA shall be construed to limit or restrict the exercise by the CITY of its power of eminent domain.
12.17 Agent for Service of Process. In the event LICENSEE is not a resident of the State of California or it is an association, partnership or joint venture without a member, partner or joint venturer, resident of the State of California, or if it is a foreign corporation, then LICENSEE shall file, upon its execution of this CCA, with the Chief Executive Officer or his or her designee, upon its execution of this CCA, a designation of a natural person residing in the State of California, giving his or her name, residence and Project addresse s, as its agent for the purpose of service of process in any court action arising out of or based upon this CCA, and the delivery to such agent of a copy of any process in any such action shall constitute valid service upon LICENSEE. If for any reason service of such process upon such agent is not feasible, then in such event LICENSEE may be personally served with such process out of the County of Los Angeles and such service shall constitute valid service upon LICENSEE. LICENSEE is amenable to the process so described, submits to the jurisdiction of the Court so obtained, and waives any and all objections and protests thereto.
12.18 Good Standing. LICENSEE represents and warrants to the CITY that the LLC is duly organized, validly existing, and in good standing under the laws of the State in which it is incorporated, and that it has all power and authority required to enter into and perform this CCA.
12.19 Authority to Execute . The person or persons executing this CCA on behalf of LICENSEE warrants and represents that he/she/they have the authority to execute this CCA on behalf of his/her/their corporation, partnership or Project entity and warrants and represents that he/she/they has/have the authority to bind LICENSEE to the performance of its obligations hereunder. LICENSEE shall each deliver to CITY on execution of this CCA a certified copy of a resolution and or minute order of their respective board of directors or appropriate governing body authorizing the execution of this CCA and naming the officers that are authorized to execute this CCA on its behalf. Each individual executing this CCA on behalf of his or her respective company or entity shall represent and warrant that:
(i) The individual is authorized to execute and deliver this CCA on behalf of that company or entity in accordance with a duly adopted resolution of the company's board of directors or appropriate governing body and in accordance with that company's or entity's articles of incorporation or charter and bylaws or applicable formation documents; and
(ii) This CCA is binding on that company or entity in accordance with its terms; and
(iii) The company or entity is a duly organized and legally existing company or entity in good standing; and
(iv) The execution and delivery of this CCA by that company or entity shall not result in any breach of or constitute a default under any mortgage, deed of trust, loan agreement,
credit agreement, partnership agreement, or other contract or instrument to which that company or entity is party or by which that company or entity may be bound.
12.20 No Damages Relief Against CITY. The parties acknowledge that the CITY would not have entered into this CCA had it been exposed to damage claims from LICENSEE, its agents, officers, employees, or anyone acting on behalf of LICENSEE for any breach thereof. As such, the parties agree that in no event shall LICENSEE, or LICENSEES' agents, officers, employees, partners, or anyone acting on behalf of LICENSEE be entitled to recover damages against CITY for breach of this CCA.
12.21 Laws. LICENSEE agrees to comply with all applicable state, regional, and local laws, regulations, polices and rules. In addition, LICENSEE further agrees to comply with all issued entitlements, permits, licenses, including any and all applicable development st andards.
Specifically, LICENSEE agrees to comply with all applicable provisions of BPMC.
12.22 Compliance with Conditions of Approval . LICENSEE agrees to comply with and fulfill all conditions of approval for any and all entitlement, permits, and/or licenses it receives from the CITY. All conditions of approval for all entitlements, permits and/or licenses are attached hereto and incorporated herein by this reference.
12.23 Consistent with State and Federal Regulations . The CITY acknowledges that this CCA shall be read consistent with any statewide or national regulation of commercial cannabis that is promulgated in the future, either by legislative action or voter approval. In the event national or statewide regulations are promulgated which decriminalize or legalize the adult -use of marijuana for recreational use, this CCA shall govern the conduct of the property under such future regulations.
12.24 Compliance with Applicable Laws . LICENSEE shall comply with all applicable laws, ordinances, administrative regulations, and permitting requirements in carrying out its obligations under this CCA.
12.25 Necessary Acts. Each Party shall execute and deliver such papers, documents, and instruments, and perform such acts as are necessary or appropriate, to implement the terms of the CCA and the intent of the Parties to the CCA.
12.26 Consultation with Counsel. The Parties have entered and executed this CCA freely and voluntarily based on their own independent judgment, after consultation with their respective counsel, and without duress, coercion, or undue influence of any kind.
12.27 Superseding C lause. This CCA supersedes any and all other agreements or contracts, either oral or written, between the parties with respect to the subject matter herein. ///
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12.28. Documents Attached to this CCA. The following documents are attached to and, by this reference, are made part of this CCA:
No. 1 – Legal Description of the Property and/or Properties ; No. 2 – Map showing Property and its location;
No. 3 – CITY Cannabis Permit Application Form (proprietary information to be redacted); No. 4 – Landlord Consent;
No. 5 – Personal Guaranty;
No. 6 -- Project Plan;
No. 7 –Three years revenue projections from date of execution of CCA (to be updated annually);
No. 8 – Public Benefits Plan
No. 9--California State License Type ( Manufacturer and Self-Distribution), when issued by the DCC; and
No. 10- Checklist for Determination of Renewal of CCA by CEO (per § 3.4, herein).
[Signatures on the following page]
IN WITNESS WHEREOF, the parties hereto have caused this CCA to be executed as of the dates written above.
CITY OF BALDWIN PARK
a California municipal corporation
By: ____________________________
Emmanuel J. Estrada, Mayor
CALIFORNIA HARVEST FUND, LLC,
a California limited liability company
By: _____________________________
Name: Jason Turchin, Managing Partner
Date: ____ ___, 2024
ATTEST:
By: ____________________________
City Clerk
Approved as to Form:
By: _______________________________
Julia Sylva, Special Counsel
Commercial Cannabis Activity,
City of Baldwin Park
Approved as to Form:
By: __________________________________
Alejandro Herrera, Counsel to Licensee
No. 1 - Legal Description of Property:
Lot 3 of Tract 36684, in the City of Baldwin Park as per Map recorded in Book 921 Pages 18 to 20, inclusive, of Maps, in the Office of the County Recorder, County of Los Angeles.
Common Address: 15023 Ramona Boulevard, Baldwin Park, CA 91706 Assessor’s Parcel Number: 8437-021-006
No. 2 – Map showing Property and its location
No. 3 – CITY Cannabis Permit Application
(proprietary information to be redacted)
SEE ATTACHED.
No. 4 – Landlord Consent, if applicable
SEE ATTACHED.
No. 5 – Personal Guaranty
SEE ATTACHED.
No. 6 – Project Plan
SEE ATTACHED.
No. 7 – Financial Projections
TO BE DETERMINED.
No. 8 – Public Benefits Plan
The City of Baldwin Park will establish a “Public Benefits Fund” to allocate a portion of the Public Benefits Fee, which will be uses to support community-based programs and activities in the City. The City will adopt a policy to provide guidelines and procedures for the distribution and use of these allocated public funds.
No. 9 -- California State License Types
Manufacturing State License Type:
Self-Distribution State License Type:
No. 10 – Checklist for Determination of Renewal of CCA by CEO
CITY OF BALDWIN PARK
Commercial Cannabis Agreement (CCA)
Checklist for Contract Renewal
as of November 2023
No. Task Status
1 Compliance with Payment of Fees to City
2 Compliance with City Ordinance, Title XI,
Chapter 127
3 Compliance with Environmental Requirements
4 Compliance with Local Hiring Requirements in
CCA
5 Compliance with Reporting Requirements to DCC
Consent to Sublease Form
15023 Ramona Blvd, Baldwin Park Ca 91706
Landlord's Information:
K8 INVESTOR HOLDINGS LLC
Attention Corey Eagle
120 S. Sierra Avenue, Solace Beach
Ca 92075, 858.683.7100
Email Address: ceaglebruttenglobal.com
Phone Number: 858.683.7100
Tenant's Information:
T-Rex Real Estate Holdings, LLC
Attention Juan H. Herrera
15260 Ventura Blvd Suite 1210
Sherman Oaks ca. 91403
Email Address: [email protected]
Phone Number: 818-968-2440
Subtenant's Information:
California Harvest Fund, LLC
Attention Jason Turchin
15023 Ramona Blvd
Baldwin Park Ca. 91706
Email Address: [email protected]
Phone Number: 818-335-3177
Property Information:
15023 Ramona Blvd
Baldwin Park Ca. 91706
Lease Start Date: 02/01/2024 Month-to-Month lease
Original Lease Agreement Reference: K8 Investor Holdings, LLC and T-Rex Real Estate Holdings, LLC
Effective Date of Sublease: March 1, 2024
DocuSign Envelope ID: A9371736-AB5B-4903-9169-B20746AB564F Docusign Envelope ID: 1E6F2B2F-188F-4B35-B87C-858A410E9B6E The undersigned, being the Manager of K8 Investor Holdings, LLC, (the “Landlord”) the legal owner the property located at 15023 Ramona Blvd, Baldwin Park Ca 91706 (the “Property“) and the landlord under that certain lease to T-Rex Real Estate Holdings, LLC (the “Tenant” ) for the Property (the “Lease”), hereby grants its consent to Tenant to sublease the Property to California Harvest Fund, LLC, a California limited liability company (the “Subtenant”) under this Consent to Sublease, effective March
1, 2024 subject to the following conditions:
• T-Rex Real Estate Holdings, LLC, remains responsible for all obligations outlined in the original lease agreement.
• California Harvest Fund, LLC shall abide by the terms and conditions set forth in the original lease agreement and shall communicate directly with T-Rex Real Estate Holdings, LLC. regarding any concerns or issues related to the sublease. • This consent to sublease does not constitute a transfer of tenancy or release of T-Rex Real Estate Holdings, LLC. from any obligations under the original lease agreement. • This approval is contingent upon compliance with all terms and conditions set forth in the original lease agreement between K8 Investor Holdings, LLC and T-Rex Real Estate Holdings, LLC and is intended to facilitate the necessary approvals from the City of Baldwin Park.
• Additional terms as outlined below are hereby included in these conditions By signing below, the parties to this Consent to Sublease acknowledge that they have read and understand the terms and conditions of this consent to sublease the Property.
Landlord: K8 Investor Holdings, LLC Date: July 17, 2024 ________________________
Corey Eagle, Owner
Tenant: T-Rex Real Estate Holdings, LLC Date: _____________________ ________________________
Juan H. Herrera, CEO
Subtenant: California Harvest Fund, LLC Date: _____________________ ________________________
Jason Turchin,
Managing Member
Consent to Sublease:
Additional terms
• Both of this consent as well as any related lease, sublease, master lease or any other agreement shall expire and no longer be in effect at the earlier of a) City of Baldwin Park not approving and signing Settlement Agreement with K8 Investor Holdings LLC as result of City Council hearing on July 17th, 2024, b) City of Baldwin Park not approving T-Rex Real Estate Holdings LLC and/or California Harvest Fun LLC for a Cannabis Commercial Agreement as a result of City Council hearing on August 7th, 2024 or earlier date, or c) August 15th, 2024 at the latest.
Docusign Envelope ID: 1E6F2B2F-188F-4B35-B87C-858A410E9B6E 7/17/2024
7/17/2024
SUMMARY OF BASIC SUBLEASE
INFORMATION
This SUMMARY OF BASIC SUBLEASE INFORMATION (“Summary”) is hereby incorporated into and made a part of the attached Sublease Agreement, which pertains to the Subleased Premises described below. All references in the Sublease Agreement to the “Sublease” shallinclude this Summary. If there is any inconsistency between the Summary and the Sublease Agreement, the provisions of the Sublease Agreement shall control.
1.1 7HQDQWAddress:
1.2 SubWHQDQWAddress:
1.3 /DQGORUG$GGUHVV:
T-Rex Real Estate Holdings, LLC
15260 Ventura Blvd suite 1200
Sherman Oaks Ca. 91403
CALIFORNIA HARVEST FUND LLC
14431 Ventura Blvd Suite 270
Sherman Oaks, Ca 91423
.,19(6725+2/',1*6//&
166LHUUD$YHQXH
6RODQD%HDFK&D
1.4 Subleased Premises: 15023 Ramona Blvd, Baldwin Park Ca 91706
1.5 Initial Sublease Term: 0RQWKWRPRQWK
1.6 Rent Commencement
Date:
1. Monthly Rental:
1. Utilities:
1. Permitted Use:
1.1 Security Deposit:
1.1 Guarantor:
03/01/2024
$50,000.00 Fee per month.
SubWHQDQW shall be responsible for all utilities consumed at the Subleased Premises. This is meant to be a triple net sublease with SubWHQDQW responsible for all repairs, costs, and maintenance.
Premises shall be used for general office, administration, and use for cultivation, processing, product
manufacturing, distribution and wholesale operations of cannabis and cannabis products,
$50,000 due upon execution of sublease.
The SubWHQDQW will be subject to delivery of a fully
executed Guaranty of Lease executed by
7/30/2024
Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD 7/31/2024
7/31/2024
1.1 Commencement of Rent:
Jason Turchin in the form attached hereto
as Exhibit C.
The VXEWenant, California Harvest Fund, LLC, agrees
that the obligation to commence rent payments under
the Lease Agreement shall be contingent upon the
approval of the California State-issued cannabis
license from the Department of Cannabis Control
("DCC") and the California Department of Public
Health ("CDPH"). Rent payments shall commence
once the state and the City of Baldwin Park issue the
approval.
Additional term
• All of the Summary of Basic Sublease, the Consent to Sublease, as well as any related Lease, Sublease, Master Lease or any other Agreement shall expire and no longer be in effect at the earlier of a) City of Baldwin Park not approving and signing Settlement Agreement with K8 Investor Holdings LLC as result of City Council hearing on July 17th, 2024, b) City of Baldwin Park not approving T-Rex Real Estate Holdings LLC and/or California Harvest Fun LLC for a Cannabis Commercial Agreement as a result of City Council hearing on August 7th, 2024 or earlier date, or c) August 17th, 2024 at the latest. __________________________
Corey Eagle
K8 Investor Holdings, LLC
7/30/2024
Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD
CALIFORNIA HARVEST FUND LLC
Jason Turchin
7/31/2024
7/31/2024
Juan Herrera
T-REX REAL ESTATE
HOLDINGS LLC
SUBLEASE AGREEMENT
This Sublease Agreement (the “Sublease”) is made and entered into, effective as of the 26th day of )HEUXDU\,2024,(the “Effective Date”), by and among T-REX REAL ESTATE HOLDINGS LLC , on the one hand, (the " 7HQDQW") and CALIFORNIA HARVEST FUND LLC, a California limited Liability Company (the "Sub WHQDQW"). Each of 7HQDQW and Sub WHQDQW is sometimes referred to herein individually as a “Party”) and, collectively, as the "Parties").
Purpose. The Parties agree that the SubWHQDQW shall lease from the7HQDQW(the “Sublease")a total of 100% of the building of the 7HQDQWV leasehold interest in the premises locatedat 15023 Ramona Blvd, Baldwin Park Ca 91706, as described in Exhibit A, (the “Premises"), pursuant to the terms and conditions contained in that certain Lease Agreement by and between the /DQGORUG and T-Rex Real Estate Holdings, LLC (the “WHQDQW”), atrue and correct copy of which is attached as Exhibit B to this Agreement (the “Lease &RQVHQWWR6XEOHDVH”).Except where otherwise indicated, capitalized words used but not defined in this Sublease shall have the respective meanings given to them in the Lease, and each reference in this Sublease shall be deemed by the Parties, and construed, to incorporate all of the terms and conditions set forth in the Lease. Sublease Term .S u bWHQDQW shall occupy the Sublease RQ D PRQWKWRPRQWK WHUP .
Thecommencement date will begin 0DUFK VW
Guaranty. SuEWHQDQW shall provide to the satisfaction of the Landlord and the 7HQDQW,a Lease Guaranty, substantially in the form provided as Exhibit C attached to the Lease (a “Lease Guaranty”).
Rent. SuEWHQDQW shall pay, throughout the Sublease Werm, an amount equal to Fifty Thousand Dollars ($50,000.00 per month, and its pro rata proportion of any other charges, taxes, utilities and assessments for whichWHQDQW
is obligated to pay under the Lease. Rentis
due on the 1st of every month. Late fee of 10% will be added if rent is not received by the5th day of the month. This includes fees payable under the Management Agreement 5HQW SD\PHQWVVKDOOFRPPHQFHRQFHWKH6WDWHDQGWKH&LW\RI%DOGZLQ3DUNLVVXHWKHDSSURYDO Security Deposit . Upon execution of this Sublease Agreement, Sub WHQDQW shall remit to WHQDQW a Security Deposit in the amount of )LIW\ Thousand Dollars ($50,000.00).
Security Deposit payments shall commence once the state and the City of Baldwin Park issue the approvalDQGXSRQWKHDSSURYDORIWKH&DOLIRUQLD6WDWHLVVXHGFDQQDELVOLFHQVH IURPWKH'HSDUWPHQWRI&DQQDELV&RQWURO
³'&&´
DQGWKH&DOLIRUQLD'HSDUWPHQWRI3XEOLF
+HDOWK
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Subleasing and Assignment. SubWHQDQW may not lease, sublease, or assign the Sublease hold without the prior written consent of the WHQDQW and the Landlord, as applicable. In no event, may Sub WHQDQW make any Restricted Transfer as defined and set forth in Section 18 of the Lease without obtaining the WHQDQWV and the Landlord’s prior written consent,which SubWHQDQW understands and agrees may be given or withheld in their sole discretion.
Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD Any purported Sublease of the Sublease hold space in the Premises, shall be in writing, and signed by all Parties thereto. Any sublease or assignment which is made without adhering to the provisions of this Section 6 shall be null and void ab initio. Compliance with Laws. The Parties each hereby agree that in the custody and use of their respective allocated portions of the Premises, no Party will take, omit to take, or suffer to be taken by any other person any act, where the taking, omission, or occurrence of such act on the Premises, does, will, or could reasonably be expected to, create a breach or violation (including without limitation upon the giving of notice or the passage of time, or both), of any Laws and Orders, as defined in and described in Section 7.1 of the Lease. Additionally, the SubWHQDQW further covenants and agrees to the 7HQDQW, that throughout its usage of the Sublease hold, it shall not, and shall permit any other person to, take or omit to take any action which does or could jeopardize in any respect, the 7HQDQWV rights and interests in and to its Licenses provided by the Bureau of Cannabis Control, CA Department of Consumer Affairs (the “Licenses”). The SuEWHQDQW hereby agrees to indemnify and hold harmless the WHQDQW, its partners, owners, officers, directors, managers, consultants, employees, agents, contractors, representatives, attorneys, joint venturers and other affiliates, and any of their respective, partners, employees, managers, consultants, attorneys, landlords, spouses, domestic partners, agents, representatives, from and against any damages, claims, injuries, obligations or other liabilities, arising or resulting from any breach or violation of SubWHQDQW of the provisions of this Section 7 of the Lease. Complete and Binding Agreement; Controlling Agreement. All prior discussions, negotiations, agreements, understandings, and undertakings between the Parties are merged into, and superseded by, the terms of this Sublease. Any modification to this Agreement must be in writing, signed by both 7HQDQW and Sub WHQDQW. In the event that any discrepancy between this Sublease and the Lease shall arise, the Lease shall be the controlling document, and the Parties shall work together in good faith to modify this Sublease so as to conform with the Lease.
Notices. All communications required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given when personally delivered or when mailed by United States express, certified or registered mail, postage prepaid to the legal mailing addresses of the Parties.
Construction. This Agreement shall be governed by the internal laws of the State of California, without giving effect to the principles of conflicts of law applied thereby. Any dispute arising hereunder may be brought in any court of the State of California sitting in and for the County of Los Angeles. In the event that either Party shall be required to bring or defend against any action or otherwise to enforce any of its rights under this Letter, the prevailing Party in such action shall be entitled to recover from the non-prevailing Party all of the costs and expenses incurred in bringing or defending against such action (including, without limitation, reasonablyattorney’sfees and expenses). Counterparts; Facsimiles; Electronic Scans . This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Facsimiles and electronic scans
Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD containing original signatures shall be dee med for all purposes to be originally-signed copies of the documents which are the subject of such facsimiles or scans.
Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD
SIGNATURE PAGE
IN WITNESS WHEREOF, the Parties hereto have executed this Sublease as of the day and year written below.
7(1$17:
T-REX REAL ESTATE HOLDINGS, LLC
By:
Juan Herrera
Chief Executive Officer
SU%7(1$17:
CALIFORNIA HARVEST FUND, LLC
By:
Name:
Title:
" $!
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$33529('%</$1'/25'
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Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD
EXHIBIT A
LEGAL DESCRIPTION
Property address: 15023 Ramona Blvd, Baldwin Park Ca 91706 County: Los Angeles
Parcel ID: APN 8437-021-006
Census Tract 405201
Block 21
Tract 36684
Lot No. 3
Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD
EXHIBIT B
COPY OF MASTER LEASE
Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD Consent to Sublease Form
5DPRQD%OYG%DOGZLQ3DUN&D
Landlord's Information:
.,19(6725+2/',1*6//&
Attention &RUH\(DJOH
66LHUUD$YHQXH6RODQD%HDFK
&D
Email Address: FHDJOHEUXWWHQJOREDOFRP
Phone Number:
Tenant's Information:
T-Rex5HDO(VWDWH+ROGLQJV//&
$WWHQWLRQ-XDQ++HUUHUD
15260 Ventura Blvd Suite 1210
Sherman Oaks ca. 91403
Email Address: [email protected]
Phone Number: 818-968-2440
Subtenant's Information:
&DOLIRUQLD+DUYHVW)XQG, LLC
$WWHQWLRQ-DVRQ7XUFKLQ
5DPRQD%OYG
%DOGZLQ3DUN Ca.
Email Address: MDVRQWXUFKLQ#JPDLOFRP
Phone Number: 8
Property Information:
5DPRQD%OYG
%DOGZLQ3DUN Ca.
Lease Start Date:0RQWKWR0RQWKOHDVH
Original Lease Agreement Reference: .,QYHVWRU+ROGLQJV, LLC and T-Rex 5HDO(VWDWH +ROGLQJV//&
Effective Date of Sublease: 0DUFK 2024
Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD The undersigned, being the Manager of .,QYHVWRU+ROGLQJV, LLC, (the “Landlord”) the legal owner the property located at 5DPRQD%OYG%DOGZLQ3DUN&D (the “Property“)
and the landlord under that certain lease to T-Rex 5HDO(VWDWH+ROGLQJV//& (the “Tenant”) for the Property (the “Lease”), hereby grants its consent to Tenant to sublease the Property to &DOLIRUQLD+DUYHVW)XQG, LLC, a California limited liability company (the “Subtenant”) under this Consent to Sublease, effective 0DUFK 1, 202 subject to the following conditions:
x T-Rex 5HDO(VWDWH+ROGLQJV//&, remains responsible for all obligations outlined in the original lease agreement
x &DOLIRUQLD+DUYHVW)XQG, LLC shall abide by the terms and conditions set forth in the original lease agreement and shall communicate directly with T-Rex5HDO(VWDWH +ROGLQJV//&. regarding any concerns or issues related to the sublease. x This consent to sublease does not constitute a transfer of tenancy or release of T-Rex 5HDO(VWDWH+ROGLQJV//&. from any obligations under the original lease agreement. x 7KLVDSSURYDOLVFRQWLQJHQWXSRQFRPSOLDQFHZLWKDOOWHUPVDQGFRQGLWLRQVVHWIRUWKLQ WKHRULJLQDOOHDVHDJUHHPHQWEHWZHHQ.,QYHVWRU +ROGLQJV//&DQG75H[5HDO (VWDWH+ROGLQJV//&DQGLVLQWHQGHGWRIDFLOLWDWHWKHQHFHVVDU\DSSURYDOVIURPWKH &LW\RI%DOGZLQ3DUN
x $GGLWLRQDOWHUPVDVRXWOLQHGEHORZDUHKHUHE\LQFOXGHGLQWKHVHFRQGLWLRQV By signing below, the parties to this Consent to Sublease acknowledge that they have read and understand the terms and conditions of this consent to sublease the Property.
Landlord: .,QYHVWRU+ROGLQJV, LLC Date: -XO\ ________________________
&RUH\(DJOH, 2ZQHU
Tenant: T-Rex 5HDO(VWDWH+ROGLQJV//& Date: _____________________ ________________________
-XDQ++HUUHUD&(2
Subtenant: &DOLIRUQLD+DUYHVW)XQG, LLCDate: _____________________ ________________________
-DVRQ7XUFKLQ, 0DQDJLQJ0HPEHU
Consent to Sublease:
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QRWDSSURYLQJDQGVLJQLQJ6HWWOHPHQW$JUHHPHQWZLWK.,QYHVWRU+ROGLQJV//&DVUHVXOW RI&LW\&RXQFLOKHDULQJRQ-XO\WKE
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Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD
EXHIBIT C
GUARANTY OF SUBLEASE
THIS GUARANTY OF LEASE(“Guaranty”) is dated February 26th, 2024 and is made and entered into by JASON TURCHIN, an individual residing in the County of Los Angeles, State of California, (“Guarantor”) to be effective as of the date of the Sublease (as defined below).
RECITALS
A. This Guaranty is being executed and delivered by Guarantor as an essential inducement to that certain Sublease dated as of February 26 th, 2024 (the “Sublease”), between 7 REX REAL ESTATE HOLDINGS LLC as 7HQDQW and CALIFORNIA HARVEST FUND LLC, a California limited Liability Company, as SuEWHQDQW, covering the Premisesas described in the Sublease.
% Unless otherwise defined in this Guaranty, all capitalized terms used in this Guaranty have the same definitions as are set forth in the Sublease.
AGREEMENT
For good and valuable consideration, the re ceipt and sufficiency of which are hereby acknowledged, Guarantor agrees, covenants, represents and warrants as set forth below.
1. Guaranty . Guarantor hereby unconditionally guarantees the timely payment and performance of all rent, charges, and obligations of Sublessee under the Sublease and all other documents evidencing or securing the obligati ons under the Sublease existing and/or accruing during the Sublease Term, including, without limitation, Sublessee’s obligations to pay all base rent, percentage rent, additional rent, common area maintenance costs and expenses, taxes and to perform all of Sublessee’s obligations under the Sub lease including, without limitation, maintenance and indemnity obligations unde r the Sublease (collectively, the “Guarantied Obligations”). This Guaranty is an absolute guarant y of payment and performance and not of collection. This Guaranty will survive the termin ation of the Sublease and will continue in full force and effect with respect to any of Sublessee’s obligations under the Sublease which are not fully performed.
2. Rights of Sublessor . Guarantor authorizes Sublessor to, at any time and from time to time, in Sublessor’s discretion, (a) take and hold, and apply, any security for the Guarantied Obligations; (b) accept addition al or substituted security; (c) subordinate, compromise or release any security; (d) release S ublessee or any other person from its liability for all or any part of the Guarantied Obligations; (e) participate in any settlement offered by Sublessee or any guarantor, whether in liquidation, reorganization, receivership, bankruptcy or otherwise; (f) release, substitute or add any one or more guarantors or endorsers; (g) assign this Guaranty and/or the Guarantied Obligations in whole or in part; or (h) modify, extend and/or amend the Guarantied Obligations. Sublessor may take any of the foregoing actions upon any terms and conditions as Sublessor may elect, without giving notice to Guarantor or obtaining the consent of Guarantor and without affecting the liability of Guarantor to Sublessor.
Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD
3. Independent Obligations . Guarantor’s obligations under this Guaranty are independent of those of Sublessee or of any other guarantor. Sublessor may bring a separate action against Guarantor without proceeding (either before, after or concurrently) against Sublessee or any other guarantor or person or any security held by Sublessor and without pursuing any other remedy. Sublessor’s rights under this Guaranty shall not be exhausted by any action of Sublessor until all of the Guarantied Obligations have been fully performed.
4. Waiver of Defenses. Guarantor waives:
4.1 Any right to require Sublessor to proceed against Sublessee or any other person or any security now or hereafter held by Sublessor or to pursue any other remedy whatsoever, including, without limitation, any such right or any other right set forth in or arising out of Sections 2845, 2848, 2849, 2850, 2855 or 3433 of the California Civil Code.
4.2 Any defense based upon any legal disability of Sublessee or any guarantor, or any discharge or limitation of th e liability of Sublessee or any guarantor to Sublessor, or any restraint or stay applicable to actions against Sublessee or any other guarantor, whether such disability, discharge, limitation, re straint or stay is consensual, or by order of a court or other governmental authority, or aris ing by operation of law or any liquidation, reorganization, receivership, bankruptcy, insolven cy or debtor-relief proceeding, or from any other cause.
4.3 All setoffs, counterclaims, presentment, demand, protest or notice of any kind, except for any notice which may be expressly required by the provisions of this Guaranty.
4.4 Any defense based upon the modification, renewal, extension or other alteration of the Guarantied Obligations, or of the documents executed in connection therewith.
4.5 Any defense based upon the negligence of Sublessor, including, without limitation, the failure to file a claim in any bankruptcy of the Sublessee or any guarantor.
4.6 Any defense based upon a statute of limitations and any defense based upon Sublessor’s delay in enforcing this Guaranty.
4.7 All rights of subrogation, reimbursement, indemnity, all rights to enforce any remedy that Sublessor may have against Sublessee, and all rights to participate in any security held by Sublessor for the Guarantied Obligations , including, without limitation, any such right or any other right set forth in Sections 2845, 2848 or 2849 of the California Civil Code, until the Guarantied Obligations have been paid and performed in full.
4.8 Any defense based upon or arising out of any defense that the Sublessee or any other person may have to the performance of any part of the Guarantied Obligations other than Sublessor’s prior material breach.
4.9 Any defense based upon the death, incapacity, lack of authority or termination of existence or revocat ion hereof by any person or entity or persons or entities, or the substitution of any party hereto.
Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD
4.10 Any defense based upon or related to Guarantor’s lack of knowledge as to Sublessee’s financial condition.
4.11 Any defense based upon Section 2809 of the California Civil Code.
4.12 Any and all rights to revoke this Guaranty in whole or in part, and all rights and benefits of Section 2815 of the California Civil Code.
4.13 Any defense based upon any action taken or omitted by Sublessor in any bankruptcy or other insolvency proceeding involving Sublessee, including any election to have Sublessor’s claim allowed as secured, partia lly secured or unsecured, any action taken by t he Sublessor in connection with a motion to assume , assign or reject the Sublease, any extension of credit by the Sublessor to the Sublessee in any such proceeding, and the taking and holding by the Sublessor of any security for any such extension of credit.
4.14 Any right or defense that is or may become available to the Guarantor by reason of California Civil Code Sections 2787 to and including 2855, 2899 and 3433.
4.15 All rights and defenses arising out of an election of remedies by Sublessor, even though that election of remedies destroys or impairs Guarantor’s right of subrogation and/or reimbursement against Sublessee.
5. Bankruptcy.
5.1 Until all of the Guarantied Obligations have been paid and performed in full, Guarantor shall not, without the prior written consent of Sublessor, commence, or join with any other person in commencing, any bankruptcy, reorganization, or insolvency proceeding against Sublessee. The obligations of Guarantor under this Guaranty shall not be altered, limited, or affected by any proceeding, voluntary or invol untary, involving the bankruptcy, insolvency, receivership, reorganization, liquidation, or arrangement of Sublessee, or by any defense Sublessee may have by reason of any order, decree, or decision of any court or administrative body resulting from any such proceeding. No limitation upon or stay of the enforcement of any obligation of Sublessee by virtue of any such proceeding shall limit or stay Sublessor’s enforcement of Guarantor’s payment or performance of such obligation under this Guaranty. In furtherance of the foregoing, Guarantor agrees that if acceleration of the time for payment of any amount payable by Sublessee under the Sublease or in respect of the other Guarantied Obligations is stayed for any reason, all such amounts which would be subject to acceleration shall nonetheless be deemed to be accelerated for purposes of this Guaranty and the full amount thereof shall be payable by Guarantor hereunder forthwith upon demand.
5.2 Guarantor shall file in any bankruptcy or other proceeding in which the filing of claims is required or permitted by law all claims that Guarantor may have against Sublessee relating to any indebtedness of Sublessee to Guarantor, and will upon request assign to Sublessor all rights of Guarantor thereunder. In all such cases, whether in administration, bankruptcy, or otherwise, the person or persons authorized to pay such claim shall pay to Sublessor the amount payable on such claim. Guar antor hereby assigns to Sublessor all of the Guarantor’s rights to any such payments or distributions to which Guarantor would otherwise
Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD be entitled; provided, however, that Guarantor’s obligations hereunder shall not be satisfied except to the extent that Sublessor receives cash by reason of any such payment or distribution.
If Sublessor receives anything hereunder other than cash, the same shall be held as collateral for amounts due under this Guaranty.
6. Costs and Expenses . Guarantor agrees to pay, upon Sublessor’s demand, Sublessor’s reasonable out-of-pocket costs and expenses, including but not limited to attorneys’ fees, costs and disbursements, incurred in any effort to collect or enforce any of the Guarantied Obligations or this Guaranty, regardless whether a ny lawsuit is filed, and in the representation of Sublessor in any insolvency, bankruptcy, re organization or similar proceeding relating to Sublessee or Guarantor. Until paid to Sublessor, such sums will bear interest from the date such costs and expenses are incurred at the rate set forth in the Sublease for past due obligations. The obligations of the Guarantor under this Section s hall include payment of all such costs and expenses incurred by Sublessor in enforcing any judgments.
7. Reinstatement . The liability of Guarantor here under will be reinstated and revived, and the rights of Sublessor will continue, with respect to any amount at any time paid on account of the Guarantied Obligations which Sub lessor is thereafter required to restore or return or which is avoided in connection with the bankruptcy, insolvency or reorganization of Sublessee or otherwise, all as though such amount had not been paid. The determination as to whether any such payment or performance must be restored or returned will be made by Sublessor in its sole discretion; provided, however, that if Sublessor chooses to contest any such matter, Guarantor agrees to indemnify, defend and hold harmless Sublessor from all costs and expenses (including, without limitation, reasonab le legal fees and disbursements) of such contest. Further, upon demand from Sublessor, Guarantor will restore or return such payment or performance directly on Sublessor’s behalf in furtherance of Guarantor’s obligations hereunder.
Sublessor will be under no obligation to retu rn or deliver this Guaranty to Guarantor, notwithstanding the payment of the Guarantied Obligations. If this Guaranty is nevertheless returned to Guarantor or is otherwise released, then the provisions of this Guaranty will survive such return or release, and the liability of Guaran tor under this Guaranty will be reinstated and continued under the circumstances provided herein notwithstanding such return or release.
8. Subordination . Any indebtedness of Sublessee to Guarantor now or hereafter existing shall be, and such indebtedness here by is, deferred, postponed and subordinated to payment and performance of the Guarantied Ob ligations. Any payment made to Guarantor by Sublessee or any third party with respect to the indebtedness subordinated hereunder at any time when an Event of Default exists under the Sublease or while any Guarantied Obligations are otherwise then payable or performable shall be he ld in trust by Guarantor for the benefit of Sublessor and shall be turned over to Sublessor immediately upon receipt thereof for application by Sublessor against the Guarantied Obligations. Any lien, charge or claim which Guarantor now has or hereafter may have on or to any re al or personal property of Sublessee (including without limitation any real property subject of the Sublease, the personal property located thereon, any rights therein and related thereto, and the revenue and/ or income realized therefrom) and any security for any loans, adva nces or other indebtedness of Sublessee to Guarantor, shall be, and hereby is, subordinated to the payment and performance of the Guarantied Obligations.
Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD
9. Representations and Warranties . Guarantor makes the following representations and warranties, which are de emed to be continuing representations and warranties until payment and performance in full of the Guarantied Obligations.
9.1 Guarantor has all the requisite power and authority to execute, deliver and be legally bound by this Guaranty on the terms and conditions herein stated. Guarantor is a California corporation validly existing and in good standing in the State of California with the full power and authority to enter into this Guaranty.
9.2 Guarantor has all the requisite power and authority to transact any other business with Sublessor as necessary to fulfill the terms of this Guaranty.
9.3 This Guaranty constitutes the legal, valid and binding obligations of Guarantor enforceable against Guarantor in accordance with its terms.
9.4 Neither the execution and de livery of this Guaranty nor the consummation of the transaction contemplate d hereby will, with or without notice and/or lapse of time, (a) constitute a breach of any of the terms and provisions of any note, contract, document, agreement or undertaking, whether written or oral, to which Guarantor is a party or to which Guarantor’s property is subject; (b) accelerate or constitute a ny event entitling the holder of any indebtedness of Guarantor to accelerate the maturity of any such indebtedness; (c) conflict with or result in a breach of any writ, ord er, injunction or decree against Guarantor of any court or governmental agency or instrumentality; or (d) conflict with or be prohibited by any federal, state, local or other governmental law, statute, rule or regulation.
9.5 No consent of any other person not heretofore obtained and no consent, approval or authorization of any person or entity is required in connection with the valid execution, delivery or performance by Guarantor of this Guaranty.
9.6 Guarantor will receive substantial and material benefits from the leasing of the Premises to Sublessee and the consideration received by Guarantor for this Guaranty is sufficient in all respects.
9.7 Guarantor presently has and will at all times maintain sufficient assets and tangible net worth to timely pay and perform all of the Guarantied Obligations, and Guarantor will not take any action nor participate in any transaction which would materially impair Guarantor’s ability to so pay and perform the Guarantied Obligations.
9.8 Neither this Guaranty nor any other statement furnished by Guarantor to Sublessor in connection with the transactions contemplated hereby (including, without limitation, any financial statements or other business information) contains any untrue statement of material fact or omits to state a material fact necessary in order to make the statements contained herein or therein true and not misleading.
10. Joint and Several Liability . The obligations, waivers, promises, representations and warranties set forth herein are the joint a nd several undertakings of each of the persons or entities executing this Guaranty as a Guarantor and of any other guarantors or other persons or
Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD entities obligated from time to time with respect to the Guarantied Obligations. Sublessor may proceed hereunder against any one or more of said persons or entities without waiving its rights to proceed against any of the others. Any married person who executes this Guaranty agrees that recourse may be had against his or her separate and community property.
11. Inducement; No Assignment . Guarantor acknowledges that the undertakings given in this Guaranty are given in consideration of Sublessor’sentering into the Sublease and that Sublessor would not enter into the Sublea se but for the execution and delivery of this Guaranty. Guarantor’s obligations hereunder are personal to Guarantor and Guarantor may not assign or delegate any of its obligati ons under this Guaranty without Su blessor’s prior written consent, which consent may be withheld in Sublessor’s sole, absolute and arbitrary discretion.
12. Guarantor Information . Guarantor will promptly supply such financial statements and business information regarding Guarantor as may reasonably be requested from time to time by Sublessor or any lender or prospective purchaser of Sublessor for the purpose of evaluating the creditworthiness of Guarantor and Guarantor’s ability to perform its obligations under this Guaranty.
13. Sublessee’s Financial Condition. Guarantor is relying upon its own knowledge and has made such investigation as Guarantor has deemed necessary with respect to Sublessee’s financial condition. Guarantor a ssumes full responsibility for keeping fully informed of the financial condition of Sublessee and all other circumstances affecting Sublessee’s ability to pay and perform its obligations under the Sublease, a nd agrees that Sublessor will have no duty to report to Guarantor any information which Sublessor rec eives about Sublessee’s financial condition or any circumstances bearing on Sublessee’s ability to perform.Guarantor agrees that Sublessor has made no representations or assurances regarding Sublessee’sfinancial condition or Sublessee’s ability to pay and perform Sublessee’s obligations under the Sublease.
14. Default . The occurrence of any one or more of the following events shall, at the election of Sublessor, be deemed an event of default under this Guaranty: (a) Guarantor fails to pay any monetary Guarantied Obligation within five days after demand from Sublessor; (b) Guarantor fails to perform any non-monetary Guarantied Obligation within 15 days after demand therefor from Sublessor (or, Guarant or is not able through the use of commercially reasonable efforts to perform such Guaranteed Obligation with a 15-day period, if Guarantor does not commence to perform such obligation within such 15-day period and diligently pursue such performance to completion within an additi onal 60 days after the expiration of the initial 15-day period); (c) Guarantor fails or neglects to perform, keep or observe any other term, provision, agreement or covenant contained in this Guaranty; (d) the commencement of any liquidation, reorganization, receivership, bankruptcy, assignment for the benefit of creditors or other similar proceeding by or against Guarantor; (e) if any representation or warranty made in this Guaranty shall be or become false in any material respect; or (f) the death, legal incapacity, dissolution or termination of the Guarantor. U pon the occurrence of an event of default under this Guaranty, at the option of Sublessor, the Guarantied Obligations shall be accelerated and shall all be due and payable and enforceable against Guarantor (regardless whether the Guarantied Obligations are then due and payable under the Sublease or otherwise) and Sublessor may, in its sole discretion, in addition to any other right or remedy provided by law or at equity, all of which are cumulative and non-exclusive, proceed to suit against the Guarantor.
Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD
15. Transfer by Sublessor . If Sublessor obtains Master Lessor’s consent to transfer, encumber or assign (other than for collateral security purposes) a majority of Sublessor’s membership interests or any other form of assign ment as defined under the Master Lease, this Guaranty shall automatically apply in favor of Master Lessor with respect to all Guarantied Obligations arising or accruing from and after the date of the transfer. In addition, this Guaranty shall remain in full force and effect in favor of the transferor with respect to all Guarantied Obligations arising or accruing under the Sublease prior to the date of the transfer including, without limitation, all Guarantied Obligations relating to Sublessee’s Indemnity and insurance obligations (and similar obligations) under the Sublease with respect to matters arising or accruing during the transferor’s period of ownership.
16. Severability . If any one or more of the cove nants, provisions or terms of this Guaranty is, in any respect, held to be invalid, illegal or unenforceable for any reason, the remaining portion thereof and all other covenant s, conditions, provisions, and terms of this Guaranty will not be affected by such holding, bu t will remain valid and in force to the fullest extent permitted by law.
17. Notices . All notices, demands and other communications with, to, from or upon the Guarantor and the Sublessor required or perm itted hereunder shall be in writing, addressed to the parties at their respective addresses as follows: (a) with respect to Sublessor, to the notice address(es) for Sublessor under the Sublease; and (b) with respect to Guarantor, unless a separate notice address is specified on the signature page of this Guaranty, to Guarantor in care of Sublessee at the notice address(es) for Sublessee under the Sublease; or (c) as to either, at such other address as shall be designated in a written notice to the other complying with the terms of this Section.
All such communications shall be deemed effective upon the earliest of (i) actual delivery if delivered by personal delivery; (ii) four Busine ss Days following deposit, first class postage prepaid, with the United States mail; (iii) if sent by certified postage prepaid mail, upon the earliest to occur of (a) four Business Days followi ng deposit thereof in the United States mail, or (b) receipt (or refusal to accept delivery); or (iv) on the next Business Day after deposit with an overnight air courier with request for next business day delivery.
18. Miscellaneous. No provision of this Guaranty or Sublessor’s rights hereunder may be waived or modified nor can Guarantor be released from its obligations hereunder except by a writing executed by Sublessor. No such waiver shall be applicable except in the specific instance for which given. No delay or failure by Sublessor to exercise any right or remedy against Sublessee or Guarantor will be construed as a waiver of that right or remedy. All remedies of Sublessor against Sublessee and Guarantor are cumulative. This Guaranty shall be governed by and construed under the laws of the State of California. The provisions of this Guaranty will bind and benefit the heirs, executors, administrators, legal representatives, successors and assigns of Guarantor and Sublessor. The term “Sublessee” will mean not only the Sublessee named herein but also any other person or entity at any ti me occupying all or any portion of the Premises or assuming or otherwise becoming liable (other than as a guarantor) for all or any part of the Guarantied Obligations. This Guaranty constitutes the entire agreement between Guarantor and Sublessor with respect to its subject matter, and supersedes all prior or contemporaneous agreements, representations and understandings.
Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD All headings in this Guaranty are for c onvenience only and shall be disregarded in construing the substantive provisions of this Guaranty.
IN WITNESS WHEREOF, this Guaranty has been duly executed on behalf of Guarantor and delivered to Sublessor as of the date set forth above, to be effective as of the Effective Date set forth in the Sublease.
GUARANTOR:
Name: Jason Turchin
Title: OWNER
A Resident of Los Angeles County, California
By:
Name:
Notice Address for Guarantor:
______________________________
______________________________
______________________________
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Docusign Envelope ID: DEC7DB64-5895-460E-9281-29D734EC0CBD
STAFF REPORT
ITEM NO. ____HA1____
TO: Chair and Members of the Housing Authority
FROM: Rose Tam, Director of Finance
PREPARED BY: Grace Nguyen, Senior Finance Clerk
DATE: August 7, 2024
SUBJECT: Baldwin Park Housing Authority’s Warrants and Demands
SUMMARY
Attached are the Warrants and Demands Registers for the City of Baldwin Park Housing Authority to be ratified by the Board.
RECOMMENDATION
Staff recommends that the Board ratify the attached Warrants and Demands Register.
FISCAL IMPACT
The total of the Warrants and Demands for Housing Authority was $818,797.41.
BACKGROUND
The attached Claims and Demands report format meets the required information as set out in the California Government Code. Staff has reviewed the requests for expenditures for the appropriate budgetary approval and for the authorization from the departmen t head or its designee. Pursuant to Section 37208 of the California Government Code, the Chief Executive Officer or his/her designee does hereby certify to the accuracy of the demands hereinafter referred. Payments released since the previous meeting and the following is a summary of the payment released:
1. The June 07, 2024 to July 08, 2024 Warrant check numbers 73062 through 73089 in the amount of $17,762.88 and Automated Clearing House (ACH) in the amount of $801,034.53 were made on behalf of City of Baldwin Park Housing Authority constituting of claims and demands, are herewith presented to the Board as required by law, and hereby ratified.
LEGAL REVIEW
Not Applicable
ATTACHMENTS
1. Happy Check Register
2. Happy Check Register ACH
Check Register ReportDate Range: 6/7/2024...7/8/2024VMS Date Range:...Program:-Payment Type:Check Numbers: ...Direct Deposit: Exclude Direct DepositCheck Cleared: AllPort Status: Include Port InsZero HAPs: Include Zero HAPsVoided Payments:Omit Voided PaymentsHeld Checks: Exclude Held ChecksGrouped by:Sorted by: Check Number7/8/2024Check Number Check Date Payee Name Amount DDVMS Date73062 06/12/2024 Cameron Properties $6745.0004/01/202473063 07/01/2024 Julie L Fonseca $19.0007/01/202473064 07/01/2024Vanessa G Ross$109.0007/01/202473065 07/01/2024 Jacqueline Chaves $154.0007/01/202473066 07/01/2024 Carmen Rivera-Madrid $27.0007/01/202473067 07/01/2024 Mona L Martin $57.0005/01/202473068 07/01/2024Xiomara A Martinez$21.0007/01/202473069 07/01/2024 City of Pomona Housing Authority $819.4407/01/202473070 07/01/2024 Ken Chi-Kin Yu $13.0007/01/202473071 07/01/2024 Jasmine Janae Rhodes $138.0007/01/202473072 07/01/2024 Monica A Escalante $45.0007/01/202473073 07/01/2024 Sheila M Freeman $29.0007/01/202473074 07/01/2024 Christine A Rodriguez $37.0007/01/202473075 07/01/2024 Gwendolyn Jean Adams $16.0007/01/202473076 07/01/2024 Jess Edward Peralta $10.0007/01/202473077 07/01/2024 Ricky Garcia $31.0007/01/202473078 07/01/2024 Elaina A Caldera $4.0007/01/202473079 07/01/2024 Manuel Ochoa $159.0007/01/202473080 07/01/2024 Maria L Lopez $21.0007/01/202473081 07/01/2024 Tricia J Haseltine $120.0007/01/202473082 07/01/2024 Eternal Link LLC $1893.0007/01/202473083 07/01/2024 Flemisha Perowe $135.0007/01/202473084 07/01/2024 Isabel Herrera$116.0007/01/202473085 07/01/2024 George Ka Chun Chew $2494.0007/01/202473086 07/01/2024 City of Carlsbad$1121.4407/01/202473087 07/01/2024 Cameron Properties $2526.0007/01/202473088 07/01/2024Venancio Felix$732.0005/01/202473089 07/01/2024 Mary F Ballesteros $171.0007/01/2024Check Register Report GN 07/08/2024 Page 1Copyright © 2011-2024, HAPPY Software, Inc. $17,762.88Total12Unit Count$1,083.58Average Weighted by Unit Count$455.46AverageHard to House Count Check Register Report GN 07/08/2024 Page 2Copyright © 2011-2024, HAPPY Software, Inc.
Check Register ReportDate Range: 6/7/2024...7/8/2024VMS Date Range:...Program:-Payment Type:Check Numbers: ...Direct Deposit: Include Direct DepositCheck Cleared: AllPort Status: Include Port InsZero HAPs: Include Zero HAPsVoided Payments:Omit Voided PaymentsHeld Checks: Exclude Held ChecksGrouped by:Sorted by: Check Number7/8/2024Check Number Check Date Payee Name Amount DDVMS Date33932 06/12/2024 The Six Straws LLC $120.0006/01/202433933 06/12/2024 Post Brookhollow , LP $5397.0004/03/202433934 06/12/2024 $5033.0005/01/202433935 06/12/2024 Monrovia Heritage Park LP $5574.0004/01/202433936 07/01/2024Y & H Investment, Inc.$1617.0005/01/202433937 07/01/2024 Eunice Property, LLC $1225.0007/01/202433938 07/01/2024 Wilson Apartment Associates L.P. $1816.0007/01/202433939 07/01/2024 Monet Huong Nguyen $3029.0007/01/202433940 07/01/2024ASCENSION HOLDINGS LLC$1268.0007/01/202433941 07/01/2024 Tom Cinquegrani $513.0007/01/202433942 07/01/2024 Mark T. Fernandez $881.0007/01/202433943 07/01/2024 Melody (Muoi) Dao $1597.0007/01/202433944 07/01/2024 John W. Ruwitch and Anh Lam Truong $2012.0007/01/202433945 07/01/2024Adam King Lee and Joyce Ng Lee$1374.0007/01/202433946 07/01/2024 Mingyu Qu $2201.0007/01/202433947 07/01/2024 SAE GROUP, LLC $2169.0007/01/202433948 07/01/2024 Wei Zhen Su $1600.0007/01/202433949 07/01/2024 Mallorca Apartments, LTD $3404.0007/01/202433950 07/01/2024 Michael I. or Ling Brooks $941.0007/01/202433951 07/01/2024 Cipriano Salazar Jr. $1612.0007/01/202433952 07/01/2024 Dung Tran $2357.0007/01/202433953 07/01/2024 $1395.0007/01/202433954 07/01/2024 Monrovia 612, LP $29598.0007/01/202433955 07/01/2024 Leslie K Ng $1684.0007/01/202433956 07/01/2024 Jun Hua Hu $2837.0007/01/202433957 07/01/2024 Lien Diep $1585.0007/01/202433958 07/01/2024 Rosa Lamas-Serratos $2369.0007/01/202433959 07/01/2024Villa Olive Oak dba Oak Park- South$5468.0007/01/202433960 07/01/2024 Malcolm Oso $875.0007/01/202433961 07/01/2024 Dajojo, LLC $1285.0007/01/202433962 07/01/2024 Investor Trust Realty Group, Inc. $1427.0007/01/202433963 07/01/2024 Sieu Tuan Phan $3249.0007/01/2024Check Register Report GN 07/08/2024 Page 1Copyright © 2011-2024, HAPPY Software, Inc. 33964 07/01/2024 Don Norwood $1463.0007/01/202433965 07/01/2024Ana Thai$921.0007/01/202433966 07/01/2024 SRI Properties No 15 LLC $1397.0007/01/202433967 07/01/2024 Larry Chow $1851.0007/01/202433968 07/01/2024 T & T Asset Holding, LLC $537.0007/01/202433969 07/01/2024 Michael Alfred Alarcon $1269.0007/01/202433970 07/01/2024 Mousa Boushaaya $1798.0007/01/202433971 07/01/2024 Tuan Viet Ho $2190.0007/01/202433972 07/01/2024Xiaomin Lin and Xiaoxi Wu$2717.0007/01/202433973 07/01/2024 Jun Ye and Ming Feng$1124.0007/01/202433974 07/01/2024 4324 Walnut St LLC$2118.0007/01/202433975 07/01/2024 El Monte Housing Partners LP - The $12163.0007/01/202433976 07/01/2024 Joseph T. Tung $1202.0007/01/202433977 07/01/2024Alamitas LLC$402.0007/01/202433978 07/01/2024Avalon Monrovia LLC$1473.0007/01/202433979 07/01/2024 Pro Management Inc. $1600.0007/01/202433980 07/01/2024Andrew & Eva Fogg$1419.0007/01/202433981 07/01/2024 Heritage Park Villas LP $25575.0007/01/202433982 07/01/2024 Heritage Park Villas LP $3852.0007/01/202433983 07/01/2024 Manapa Enterprises LLC $1507.0007/01/202433984 07/01/2024Villa Olive Oak dba Oak Park - South$6755.0007/01/202433985 07/01/2024$11960.0007/01/202433986 07/01/2024 Palo Verde Apartments, LP $899.0007/01/202433987 07/01/2024 Sharon Campbell $3149.0007/01/202433988 07/01/2024 John M Jacquet Sr. $1975.0007/01/202433989 07/01/2024 Linda Alice Enriquez $1327.0007/01/202433990 07/01/2024 Ha X Van $4495.0007/01/202433991 07/01/2024 Chen Jackson $1210.0007/01/202433992 07/01/2024 Philip Tsui $337.0007/01/202433993 07/01/2024 Paul Yen $1719.0007/01/202433994 07/01/2024 Mie Chen $2778.0007/01/202433995 07/01/2024 Becky Binh Nguyet Luu or Eddie Ma $2131.0007/01/202433996 07/01/2024 Tinh Van Le $627.0007/01/202433997 07/01/2024 The Six Straws LLC $12563.0007/01/202433998 07/01/2024 Everardo Garcia $1755.0007/01/202433999 07/01/2024 Ngoc T. Lieu $3008.0007/01/202434000 07/01/2024Alfred Tai-Kong Ho and Lisa Chen$562.0007/01/202434001 07/01/2024 Covina 023 Woods 206 LP c/o $882.0007/01/202434002 07/01/2024 Doreen Han $1662.0007/01/202434003 07/01/2024 PI Properties No. 94 LLC$1154.0007/01/202434004 07/01/2024 Cecilia Lan Cao $785.0007/01/202434005 07/01/2024 Baldwin Park Family Housing Limited $30651.0007/01/202434006 07/01/2024 Baldwin Park Family Housing Limited$1126.0007/01/202434007 07/01/2024 Grace Chiou $1370.0007/01/202434008 07/01/2024 Marina Alvarez $4405.0007/01/202434009 07/01/2024 Zhi Min Li and WXL Investments Inc. $945.0007/01/2024Check Register Report GN 07/08/2024 Page 2Copyright © 2011-2024, HAPPY Software, Inc. 34010 07/01/2024 Sui Man Mak $802.0007/01/202434011 07/01/2024 Henry Wong $2223.0007/01/202434012 07/01/2024 West Covina Senior Villas II, LP $506.0007/01/202434013 07/01/2024 Dung Trung Pham and Tammy Tram $750.0007/01/202434014 07/01/2024 Francisco J. Sanchez and Gloria $1045.0007/01/202434015 07/01/2024 Blessed Rock of El Monte $28486.0007/01/202434016 07/01/2024 Blessed Rock of El Monte $3981.0007/01/202434017 07/01/2024 Joanne Pham Chau$2118.0007/01/202434018 07/01/2024 $7379.0007/01/202434019 07/01/2024Alfonso Contreras$1308.0007/01/202434020 07/01/2024 Ryan Quach and Hue Cao $1886.0007/01/202434021 07/01/2024 Windwood West Covina, L.P. c/o GK $1860.0007/01/202434022 07/01/2024Alta Vista Villas, LP c/o Yale$3491.0007/01/202434023 07/01/2024 West Covina Seniors Villas I $997.0007/01/202434024 07/01/2024 Post Brookhollow , LP $17790.0007/01/202434025 07/01/2024 Rahmat Ray Nehdar$1135.0007/01/202434026 07/01/2024Alexander Chan$2260.0007/01/202434027 07/01/2024 Phat Binh Vuong $1242.0007/01/202434028 07/01/2024Alan Wu$813.0007/01/202434029 07/01/2024 Keymax Group, Inc $2370.0007/01/202434030 07/01/2024 Lawe Family Trust $795.0007/01/202434031 07/01/2024 Henry Ho $1288.0007/01/202434032 07/01/2024 PAMA IV Properties, LP $5164.0007/01/202434033 07/01/2024 Roger Hin Nam Mak $9531.0007/01/202434034 07/01/2024 LAT Investments, LLC $3231.0007/01/202434035 07/01/2024 Kimmie Mu Matsunaga $4364.0007/01/202434036 07/01/2024Xitlalai Del Real Sanchez$1560.0007/01/202434037 07/01/2024 Delgar IV LLC $1376.0007/01/202434038 07/01/2024 Mary L Haynes$1121.0007/01/202434039 07/01/2024 Betty Chim Lieu $1846.0007/01/202434040 07/01/2024 Clinett Glazis $309.0007/01/202434041 07/01/2024 Jim & Nancy Bailey $523.0007/01/202434042 07/01/2024 Kimberly Nguyen $1022.0007/01/202434043 07/01/2024 Gregory W. Pratt $4266.0007/01/202434044 07/01/2024 Joseph M. Kwok $2094.0007/01/202434045 07/01/2024 Leng Zhang and Bao Ying Jiang $1680.0007/01/202434046 07/01/2024 Mack E Titus $1232.0007/01/202434047 07/01/2024$1198.0007/01/202434048 07/01/2024 Lourdes J. Garrison $5295.0005/01/202434049 07/01/2024 Lois J Gaston $1737.0007/01/202434050 07/01/2024 Doan & Lily Thi $2100.0007/01/202434051 07/01/2024 El Monte Affordable Housing Partner $821.0007/01/202434052 07/01/2024 Jose Baudelio Delgado $349.0007/01/202434053 07/01/2024 Larry Mimms $1600.0007/01/202434054 07/01/2024 Jaime Jimenez $702.0007/01/202434055 07/01/2024 Guillermo Vasquez $2641.0007/01/2024Check Register Report GN 07/08/2024 Page 3Copyright © 2011-2024, HAPPY Software, Inc. 34056 07/01/2024 $1772.0007/01/202434057 07/01/2024 $2920.0007/01/202434058 07/01/2024 Fat Law $903.0007/01/202434059 07/01/2024 Kevin Kambor Kwong and Yuk Ming $1572.0007/01/202434060 07/01/2024 Dwight Chang $2291.0007/01/202434061 07/01/2024 Cameron Park Community Partners, $1798.0007/01/202434062 07/01/2024 Mozhgan Tavakoli $1638.0007/01/202434063 07/01/2024Anmelindon LLC$1865.0007/01/202434064 07/01/2024 Lourdes Vela $3745.0007/01/202434065 07/01/2024 Gilbert Roybal $597.0007/01/202434066 07/01/2024 Philip & Fanny Kwok $1578.0007/01/202434067 07/01/2024 Primrose Villa dba Oak Park-North$11024.0007/01/202434068 07/01/2024 Woodside Village Apartments LP $19144.0007/01/202434069 07/01/2024 Cynthia Pham $685.0007/01/202434070 07/01/2024 Katie Yau and Daniel Hong $3088.0007/01/202434071 07/01/2024 Fanny Chan $1055.0007/01/202434072 07/01/2024 Baldwin Rose LP $1896.0007/01/202434073 07/01/2024 Kwan and Mei Chiang $1026.0007/01/202434074 07/01/2024 Sergio Molina $236.0007/01/202434075 07/01/2024 Fortune America $1700.0007/01/202434076 07/01/2024 Jason Tran $1298.0007/01/202434077 07/01/2024 Chuen Lau $9120.0007/01/202434078 07/01/2024 Tanya H Chen $2281.0007/01/202434079 07/01/2024 Dan Thanh Peng and Hoan Peng $1626.0007/01/202434080 07/01/2024 Sunset Square #200U, LP $9710.0007/01/202434081 07/01/2024 Ngoc Lieu $1243.0007/01/202434082 07/01/2024 Lark Ellen Village$11337.0007/01/202434083 07/01/2024Xuyen Thach Han$2940.0007/01/202434084 07/01/2024 EZ APT LLC $1776.0007/01/202434085 07/01/2024 Kim Wah Wong and Sau Yi Wong $1490.0007/01/202434086 07/01/2024 Lucena A Ewing $4496.0007/01/202434087 07/01/2024 Jocelyn Jae Jhong $3172.0007/01/202434088 07/01/2024 Emilio De Jesus Cruz $1425.0007/01/202434089 07/01/2024 Delgar V LLC $961.0007/01/202434090 07/01/2024 Isabel R Sanchez $1855.0007/01/202434091 07/01/2024 Cienega Garden Apartments $9389.0007/01/202434092 07/01/2024Vinh Hong Lai$4189.0007/01/202434093 07/01/2024 LPC 1829 E Workman Ave., LLC $2910.0007/01/202434094 07/01/2024 Doreen E Ewing $1381.0007/01/202434095 07/01/2024 Moller Property Management $1045.0007/01/202434096 07/01/2024 TPA/NASCH LLC, Westgate as a sole $1357.0007/01/202434097 07/01/2024 TDF LP - Pacific Towers c/o Winn $14109.0007/01/202434098 07/01/2024 Paul & Annie W Chau $892.0007/01/202434099 07/01/2024 Steven Eraj Espantman and Marta $1295.0007/01/202434100 07/01/2024 Gilbert Dominguez $10867.0007/01/202434101 07/01/2024 Eric Yu $1883.0007/01/2024Check Register Report GN 07/08/2024 Page 4Copyright © 2011-2024, HAPPY Software, Inc. 34102 07/01/2024 Up Hill Investment Inc. $1766.0007/01/202434103 07/01/2024 Dieu Van Huynh $918.0007/01/202434104 07/01/2024 Kelly Nguyen $1877.0007/01/202434105 07/01/2024Vijay Gulati$4752.0007/01/202434106 07/01/2024 Nancy Mikhaiel $2151.0007/01/202434107 07/01/2024 Badillo Street Senior Apartments, LP $23829.0007/01/202434108 07/01/2024 Monrovia Heritage Park LP $28548.0007/01/202434109 07/01/2024 Tyler-Valley Metro Housing, LP $15764.0007/01/202434110 07/01/2024 James or Barbara Fox$1125.0007/01/202434111 07/01/2024 Mayra Ortega $1263.0007/01/202434112 07/01/2024 Sel Homes LLC $9094.0007/01/202434113 07/01/2024 Hui Chuan Wang $4668.0007/01/202434114 07/01/2024 725-731 W. Duarte Rd, LLC $1036.0007/01/202434115 07/01/2024 Nhan Nguyen and Amy Tran $2948.0007/01/202434116 07/01/2024 Puente Villa LLC $2431.0007/01/202434117 07/01/2024 RAMONA BLVD. FAMILY$11138.0007/01/202434118 07/01/2024AJG Realty Inc.$2053.0007/01/202434119 07/01/2024 Maria Martha Martinez $7382.0007/01/202434120 07/01/2024Antonio & Aida Rinos$1773.0007/01/202434121 07/01/2024 Greater San Gabriel Valley Property $832.0007/01/202434122 07/01/2024Annette C Scott$1572.0007/01/202434123 07/01/2024 1024 Royal Oaks LP dba Whispering $18522.0007/01/202434124 07/01/2024 1024 Royal Oaks LP dba Whispering $12719.0007/01/202434125 07/01/2024 Khiem Nguyen, Authorized Signer $2341.0007/01/202434126 07/01/2024 Derek Sim$1197.0007/01/202434127 07/01/2024 Josephine Tran$1124.0007/01/202434128 07/01/2024Allan M. & Virginia J Chipp and Ralph$1060.0007/01/202434129 07/01/2024 Zi Jian Li $1227.0007/01/202434130 07/01/2024 Minh A Nguyen $1902.0007/01/202434131 07/01/2024 DelGar I LLC. $1315.0007/01/202434132 07/01/2024 Jaime Barcena $1400.0007/01/202434133 07/01/2024 Monica D Mao $1665.0007/01/202434134 07/01/2024 Shiu-Ein Huang $248.0007/01/202434135 07/01/2024 The Promenade Housing Partners, LP $5081.0007/01/202434136 07/01/2024 Paramjit S Nijjar $3120.0007/01/202434137 07/01/2024 Rosa Beltran $1890.0007/01/202434138 07/01/2024 David Wagner$1173.0007/01/202434139 07/01/2024Ynfante Holdings I, LLC$1008.5307/01/202434140 07/01/2024 Roman Basin $1453.0007/01/202434141 07/01/2024 Sandhya Kal and Padma Kal $1519.0007/01/202434142 07/01/2024 K. Carl and Zitta A Setian $1380.0007/01/202434143 07/01/2024 Nomer Lacson $2038.0007/01/202434144 07/01/2024Anna & Simon Choi$1429.0007/01/202434145 07/01/2024 Chung Thi Pham $2695.0007/01/202434146 07/01/2024 Roy Lam $1298.0007/01/202434147 07/01/2024 Golden Dragon Properties LLC c/o $970.0007/01/2024Check Register Report GN 07/08/2024 Page 5Copyright © 2011-2024, HAPPY Software, Inc. 34148 07/01/2024 Nancy H Shen $766.0007/01/202434149 07/01/2024 Richard A DaSylveira$611.0007/01/202434150 07/01/2024 Sara Romo $2447.0007/01/202434151 07/01/2024 T & P Property LLC $925.0007/01/202434152 07/01/2024 Singing Wood Senior Housing LP $18819.0007/01/202434153 07/01/2024 Sitara B. Mamdani $2362.0007/01/202434154 07/01/2024 Garvey Senior Affordable Partners, LP $3601.0007/01/202434155 07/01/2024Amy Phan Tran$1146.0007/01/202434156 07/01/2024 Ryan Kinpong Woo and Ching King $573.0007/01/202434157 07/01/2024 Mei Yan Chen $1205.0007/01/202434158 07/01/2024 Shawn Hui Zhen $2698.0007/01/2024$801,034.53Total539Unit Count$1,480.49Average Weighted by Unit Count$1,472.49Average4Hard to House Count Check Register Report GN 07/08/2024 Page 6Copyright © 2011-2024, HAPPY Software, Inc.
STAFF REPORT
ITEM NO. _____HA 2 ____
TO: Chair and Members of the Housing Authority
FROM: Rose Tam, Director of Finance
PREPARED BY: Anthony Ceballos, Accountant
DATE: August 7, 2024
SUBJECT: Treasurer’s Report HA – May 2024
SUMMARY
Attached is the Treasurer’s Report for the month of May 2024. The Treasurer’s Report lists all cash for the City which includes the Baldwin Park Financing Authority, the Housing Authority, and the Successor Agency to the Community Development Commission (CDC). All investments are in complia nce with the City’s Investment Policy and the California Government Code.
RECOMMENDATION
Staff recommends that the Board receive and file the Treasurer’s Report for May 2024.
FISCAL IMPACT
None
BACKGROUND
City of Baldwin Park Investment Policy requires the Treasurer’s Report be submitted to the Mayor and City Council on a monthly basis.
LEGAL REVIEW
Not Applicable
ATTACHMENTS
1. Exhibit “A”, Treasurer’s Report
ESTIMATED
INVESTMENT INTEREST PURCHASE MATURITY PAR CURRENT BOOK MARKET
DESCRIPTION RATE DATE DATE VALUE PRINCIPAL VALUE VALUE
State of California Local Agency Investment Fund (LAIF) * City-Including General Fund & all other Special Revenue Funds 4.332% Varies Varies 12,466,047.01$ 12,466,047.01$ 12,466,047.01$ 12,466,047.01$ * Housing Authority 4.332% Varies Varies 426.28 426.28 426.28 426.28 12,466,473.29 12,466,473.29 12,466,473.29 12,466,473.29 Certificate of Deposit
* Traditions Bancorp Inc. (Cambridge Investment Research) 4.650% 11/4/2022 11/4/2024 250,000.00 250,000.00 250,000.00 249,087.50 * BMO 5.400% 4/26/2024 7/26/2024 10,000,000.00 10,000,000.00 10,000,000.00 10,051,780.82 10,250,000.00 10,250,000.00 10,250,000.00 10,300,868.32 US Treasury Securities
* United States Treas NTS 3.000T 07/31/24 B/E DTD 07/31/22 1st CPN DTE 01/31/23 CPN PMT Semi Annual (Multi-Bank Securities Inc.) 3.000% 7/13/2023 7/31/2024 6,500,000.00 6,500,000.00 6,500,000.00 6,474,390.00 * United States Treas Bills 0.000% 08/22/24 B/E DTD 02/22/24 (Piper Sandler & Co.) 0.000% 2/22/2024 8/22/2024 3,000,000.00 3,000,000.00 3,000,000.00 2,965,020.00 * United States Treas Bills 0.000% 09/26/24 B/E DTD 03/28/24 (Piper Sandler & Co.) 0.000% 4/3/2024 9/26/2024 10,000,000.00 10,000,000.00 10,000,000.00 9,833,100.00 19,500,000.00 19,500,000.00 19,500,000.00 19,272,510.00 US Government Bonds
* Federal Natl Mtg Assn 5.210% 02/14/25 B/E DTD 02/16/24 Callable 08/14/24 @ 100.000 (Multi-Bank Securities Inc.) 5.210% 2/16/2024 2/14/2025 2,000,000.00 2,000,000.00 2,000,000.00 1,995,420.00 * Federal Natl Mtg Assn 5.210% 02/14/25 B/E DTD 02/16/24 Callable 08/14/24 @ 100.000 (Piper Sandler & Co.) 5.210% 2/16/2024 2/14/2025 2,000,000.00 2,000,000.00 2,000,000.00 1,995,420.00 * Federal Home LN BKS CONS BD 5.250% 12/30/24 B/E DTD
03/28/24 Callable 06/28/24 @ 100.000 (Piper Sandler & Co.) 5.250% 4/2/2024 12/30/2024 5,000,000.00 5,000,000.00 5,000,000.00 4,994,050.00 * Federal Home LN BKS CONS BD 5.350% 04/3/25 B/E DTD
04/4/24 Callable 07/3/24 @ 100.000 Moody Rating Aaa (Piper Sandler & Co.) 5.350% 4/4/2024 4/3/2025 7,000,000.00 7,000,000.00 7,000,000.00 6,992,720.00 * Federal Home LN BKS CONS BD 5.180% 10/2/25 B/E DTD
04/2/24 Callable 01/2/25 @ 100.000 Moody Rating Aaa S & P (Piper Sandler & Co.) 5.180% 4/2/2024 10/2/2025 7,000,000.00 7,000,000.00 7,000,000.00 6,991,320.00 * Federal Home LN BKS CONS BD 5.125% 03/27/26 B/E DTD
03/28/24 Callable 12/27/24 @ 100.000 Moody Rating Aaa S & P (Piper Sandler & Co.) 5.125% 4/2/2024 3/27/2026 7,000,000.00 7,000,000.00 7,000,000.00 6,981,940.00 30,000,000.00 30,000,000.00 30,000,000.00 29,950,870.00 US Bank - Debt Service Trustee Accounts
* Fiscal Agent Funds (Trust/Debt Service Fund) Varies Varies Varies 7,247,477.12 7,247,477.12 7,247,477.12 7,247,477.12 * Fiscal Agent Funds - Successor Agency (Trust/Debt Service Fund Varies Varies Varies 869.66 869.66 869.66 869.66 7,248,346.78 7,248,346.78 7,248,346.78 7,248,346.78
79,464,820.07$ 79,464,820.07$ 79,464,820.07$ 79,239,068.39$ Total Investments 79,464,820.07$
Cash with BMO
574,649.26
394,484.92
249.66
628,747.07
4,592,781.63
1,020,008.93
Total Cash with BMO 7,210,921.47
Investment Brokerage (Cash & Cash Equivalents) 27,472.09 Total Cash and Investments $ 86,703,213.63
CITY OF BALDWIN PARK
TREASURER'S REPORT
5/31/2024
Housing Authority
City Miscellaneous Cash (W/C, P/R)
City Checking (General)
CNG Station
Money Market Plus
Successor Agency
CITY OF BALDWIN PARK
TREASURER'S REPORT
5/31/2024
Approved by:
Rose Tam
Director of Finance
* Schedule of Cash and Investments includes city-wide assets as included in the Comprehensive Annual Financial Report.
Statement of Investment Policy.
* There was no investment purchase transactions made for the month of May 2024 and several deposits were made through the Local Agency Investment Fund.
In compliance with the California Government Code Section 53646 et seq., I hereby certify that sufficient investment liquidity and anticipated revenues are available to meet the City's expenditure requirements for the next six months that all investments are in compliance to the City's
STAFF REPORT
ITEM NO. ____HA 3 ____
TO: Chair and Members of the Housing Authority
FROM: Rose Tam, Director of Finance
PREPARED BY: Anthony Ceballos, Accountant
DATE: August 7, 2024
SUBJECT: Treasurer’s Report HA – June 2024
SUMMARY
Attached is the Treasurer’s Report for the month of June 2024. The Treasurer’s Report lists all cash for the City which includes the Baldwin Park Financing Authority, the Housing Authority, and the Successor Agency to the Community Development Commission (CDC). All investments are in compliance with the City’s Investment Policy and the California Government Code.
RECOMMENDATION
Staff recommends that the Board receive and file the Treasurer’s Report for June 2024.
FISCAL IMPACT
None
BACKGROUND
City of Baldwin Park Investment Policy requires the Treasurer’s Report be submitted to the Mayor and City Council on a monthly basis.
LEGAL REVIEW
Not Applicable
ATTACHMENTS
1. Exhibit “A”, Treasurer’s Report
ESTIMATED
INVESTMENT INTEREST PURCHASE MATURITY PAR CURRENT BOOK MARKET
DESCRIPTION RATE DATE DATE VALUE PRINCIPAL VALUE VALUE
State of California Local Agency Investment Fund (LAIF) * City-Including General Fund & all other Special Revenue Funds 4.480% Varies Varies 12,466,047.01$ 12,466,047.01$ 12,466,047.01$ 12,466,047.01$ * Housing Authority 4.480% Varies Varies 426.28 426.28 426.28 426.28 12,466,473.29 12,466,473.29 12,466,473.29 12,466,473.29 Certificate of Deposit
* Traditions Bancorp Inc. (Cambridge Investment Research) 4.650% 11/4/2022 11/4/2024 250,000.00 250,000.00 250,000.00 249,217.50 * BMO 5.400% 4/26/2024 7/26/2024 10,000,000.00 10,000,000.00 10,000,000.00 10,096,164.38 10,250,000.00 10,250,000.00 10,250,000.00 10,345,381.88 US Treasury Securities
* United States Treas NTS 3.000T 07/31/24 B/E DTD 07/31/22 1st CPN DTE 01/31/23 CPN PMT Semi Annual (Multi-Bank Securities Inc.) 3.000% 7/13/2023 7/31/2024 6,500,000.00 6,500,000.00 6,500,000.00 6,487,260.00 * United States Treas Bills 0.000% 08/22/24 B/E DTD 02/22/24 (Piper Sandler & Co.) 0.000% 2/22/2024 8/22/2024 3,000,000.00 3,000,000.00 3,000,000.00 2,977,350.00 * United States Treas Bills 0.000% 09/26/24 B/E DTD 03/28/24 (Piper Sandler & Co.) 0.000% 4/3/2024 9/26/2024 10,000,000.00 10,000,000.00 10,000,000.00 9,873,700.00 19,500,000.00 19,500,000.00 19,500,000.00 19,338,310.00 US Government Bonds
* Federal Natl Mtg Assn 5.210% 02/14/25 B/E DTD 02/16/24 Callable 08/14/24 @ 100.000 (Multi-Bank Securities Inc.) 5.210% 2/16/2024 2/14/2025 2,000,000.00 2,000,000.00 2,000,000.00 1,998,080.00 * Federal Natl Mtg Assn 5.210% 02/14/25 B/E DTD 02/16/24 Callable 08/14/24 @ 100.000 (Piper Sandler & Co.) 5.210% 2/16/2024 2/14/2025 2,000,000.00 2,000,000.00 2,000,000.00 1,998,080.00 * Federal Home LN BKS CONS BD 5.250% 12/30/24 B/E DTD
03/28/24 Callable 06/28/24 @ 100.000 (Piper Sandler & Co.) 5.250% 4/2/2024 12/30/2024 5,000,000.00 5,000,000.00 5,000,000.00 4,995,350.00 * Federal Home LN BKS CONS BD 5.350% 04/3/25 B/E DTD
04/4/24 Callable 07/3/24 @ 100.000 Moody Rating Aaa (Piper Sandler & Co.) 5.350% 4/4/2024 4/3/2025 7,000,000.00 7,000,000.00 7,000,000.00 6,993,770.00 * Federal Home LN BKS CONS BD 5.180% 10/2/25 B/E DTD
04/2/24 Callable 01/2/25 @ 100.000 Moody Rating Aaa S & P (Piper Sandler & Co.) 5.180% 4/2/2024 10/2/2025 7,000,000.00 7,000,000.00 7,000,000.00 6,992,510.00 * Federal Home LN BKS CONS BD 5.125% 03/27/26 B/E DTD
03/28/24 Callable 12/27/24 @ 100.000 Moody Rating Aaa S & P (Piper Sandler & Co.) 5.125% 4/2/2024 3/27/2026 7,000,000.00 7,000,000.00 7,000,000.00 6,985,860.00 30,000,000.00 30,000,000.00 30,000,000.00 29,963,650.00 US Bank - Debt Service Trustee Accounts
* Fiscal Agent Funds (Trust/Debt Service Fund) Varies Varies Varies 3,917,687.87 3,917,687.87 3,917,687.87 3,917,687.87 * Fiscal Agent Funds - Successor Agency (Trust/Debt Service Fund Varies Varies Varies 873.28 873.28 873.28 873.28 3,918,561.15 3,918,561.15 3,918,561.15 3,918,561.15
76,135,034.44$ 76,135,034.44$ 76,135,034.44$ 76,032,376.32$ Total Investments 76,135,034.44$
Cash with BMO
614,795.68
272,867.39
249.66
721,962.65
6,603,501.58
1,073,517.88
Total Cash with BMO 9,286,894.84
Investment Brokerage (Cash & Cash Equivalents) 27,559.94 Total Cash and Investments $ 85,449,489.22
Money Market Plus
Successor Agency
CITY OF BALDWIN PARK
TREASURER'S REPORT
6/30/2024
Housing Authority
City Miscellaneous Cash (W/C, P/R)
City Checking (General)
CNG Station
CITY OF BALDWIN PARK
TREASURER'S REPORT
6/30/2024
Approved by:
Rose Tam
Director of Finance
Statement of Investment Policy.
* There was no investment maturity and no purchase transactions made for the month of June 2024 and no deposits/withdrawals were made through the Local Agency Investment Fund.
In compliance with the California Government Code Section 53646 et seq., I hereby certify that sufficient investment liquidity and anticipated revenues are available to meet the City's expenditure requirements for the next six months that all investments are in compliance to the City's * Schedule of Cash and Investments includes city-wide assets as included in the Comprehensive Annual Financial Report.