RSTEP Program Cost Study Summary
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Revenue and Cost Specialists (RCS) was engaged to assist Bell Gardens with implementation of the new RSTEP program, which was passed by Council in October of 2022. RCS interviewed several rent stabilization operations for best practice advice covering subjects such as staffing duties, registry protocol, software solutions, and startup issues. RCS then analyzed Bell Gardens data and recommended fees, appropriate staffing, practices, and other considerations necessary to carry out the objectives of the RSTEP program.
REGIONAL RENT STABILIZATION INTERVIEWS
RCS and Bell Gardens staff held a series of interviews with both new and mature programs to better understand rent stabilization operations, requirements, and best practices. Agency interviews included:
Culver City Inglewood
Santa Ana Santa Monica
TWO ALTERNATE STAFFING PLANS AND ASSOCIATED LANDLORD REGISTRATION FEES RCSproposed a range of staffing to match the needs of the RSTEP program, a base-level staffing plan and a best-practices staffing plan. At base level, all critical functions are covered but has an impact on existing staff. The best-practices plan brings service levels up to regional industry standards.
PROJECTED ANNUAL RSTEP PROGRAM COST
To forecast total program costs, RCS used Bell Gardens internal methodology for estimating vacant positions, coupled with interviews with regional rent stabilization staff for operating costs. Projected budgets for both staffing plans are presented below.
The costs above do not account for a rent stabilization board. A rent stabilization board could add an additional $150,000 per year based on administrative staff, attorney involvement, and commissioner allowances required to operate the board.
FINDINGS AND OBSERVATIONS
The RCS report includes relevant helpful information gained throughout the course of the study. Many of the recommendations stem from interviews with subject matter experts at other rent stabilization programs.
Particularly helpful was advice related to program initiation challenges and best practices to gain compliance with the programs directives.
Rent Stabilization Ordinance
Cost of ServicesStudy
for theCity of Bell Gardens
September 25, 2023
Prepared by:
2¤µ¤´¤ lj #®²³ 3¯¤¢¨ «¨²³²Ǿ ,,#
1519 E Chapman Ave, Ste C
Fullerton, CA 92831
www.revenuecost.com
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September 11, 2023
City of Bell Gardens
7100 Garfield Avenue
Bell Gardens, CA 90201
Honorable Mayor, City Council, and City Manager:
On 12, 2022, the City Council adopted the Rent Stabilization and Tenant Eviction Protection RSTEP ). The Ordinance includes a rental registry, which is a portal where landlords register their rental units, update rental unit information, update tenancy information, submit notices, and pay the Rental Registry Fee. Per the Ordinance, all landlords with rental units in the City shall complete and submit registration forms for each of their rental units, on or before September 30, 2023.
In addition, an annual Registration Fee shall be imposed on each rental unit in the City. All landlords with rental units that are subject to the Ordinance shall pay a Registration Fee established by the City Council. The Registration Fee
support, and enforce the provisions of the RSTEP Ordinance. Regarding the amount of the fee, a landlord shall pay to the City a Registration Fee for each of the lrental units in the City.
To fulfill this statutory requirement, on November 14, 2022, the City of Bell Gardens issued a Request for Proposals seeking proposals for a Rent Stabilization and Tenant Eviction Protection Comprehensive Fee Study. Following this competitive procurement process, Revenue & Cost Specialists (RCS) was selected and approved by the City and entered into an Agreement with the City effective April 10, 2023, to conduct this Fee Study.
RCS is now providing the City of Bell Gardens (City) with a comprehensive Fee Study identifying the appropriate fee to recover all costs associated with the RSTEP Ordinance, and the Rent Stabilization Program .
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RCS interviewed staff from neighboring rent stabilization and rent control programs to determine required staffing for Bell Gardens. Based on these discussions, RCS developed two staffing plans: a base-minimum staffing plan and a best-practices staffing plan. Staffing details and total projected program budgets for each are presented in Chapter 2 of this report.
The rental registration fee required to offset the cost of each plan is presented below. .®³¤ ³§ ³ ¡®³§ ¯« ² ¨¢®±¯®± ³¤ ³¶® ¤·¨²³¨¦ ¤¬¯«®¸¤¤² §¨±¤£ ¨ ΑΏΑΑ ¶¨³§ ³§¤ ¤·¯±¤²² ¯´±¯®²¤ ®¥ ¥ ¢¨«¨³ ³¨¦ ¨¬¯«¤¬¤³ ³¨® ®¥ ³§¤ 234%0 ¯« ȁ
Total Projected Required Fee
Rental Registration Fee Budget # of Units Per Unit
Best Practice Staffing Plan $1,020,968 6,539 $156
Minimum/Base Level Staffing Plan $821,463 6,539 $126
The fee required to fund the RSTEP program ranges between $127 and $155 per unit. Additional costs include contractual support for rental registration software, public relations, legal advice, hearing officers, and development of RSTEP policies and processes.
Since the Rent Stabilization Program is a new endeavor for the City, reasonable and evidence-based assumptions were made in the areas of staff time allocation and number of task participants. Where possible, we benchmarked with data from other cities that have a rent stabilization ordinance. Our Fee Study focused on calculating the lowest fee reasonably possible to operate the Rent Stabilization Program successfully.
RCS wants to thank Gustavo Romo, Community Development Director, and his team within the Community Development Department, for providing the crucial information needed to complete this Fee Study.
Respectfully submitted,
CHU THAI Jeff Wakefield
Partner Senior Associate
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TableofContents
________________________________________________________________ ___________________________________________________
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CHAPTER V -RENT STABILIZATION BOARD___________________________________________________________23 CHAPTER VI-RENTAL REGISTRY SOFTWARE_________________________________________________________25 APPENDIX A RENT STABILIZATION AND TENANT EVICTION PROTECTIONS ORDINANCE_____21 APPENDIX B SURVEY OF RENT STABILIZATION PROGRAMS______________________________________69 APPENDIX C RENT STABILIZATION POLICIES OF CALIFORNIA CITIES 2023___________________71 APPENDIX D CULVER CITY RENT STABILIZATION BUDGET_______________________________________77 #¨³¸ ®¥ "¤«« ' ±£¤² 2¤³ « 2¤¦¨²³±¸ &¤¤ 3³´£¸ !´¦´²³ 20230 ¦¤ Ȟ 5
CHAPTERITHENEEDFORUSERFEES
ImpactofPropositions13,4,218and26
Proposition 13 was passed by California voters in 1978, forever changingcity budgets. Prior to 1978, cities and counties balanced their budgets with a property tax formula. The property tax property owners paid could increase dramatically year over year, creating hardship for those with fixed incomes. Proposition 13 capped property tax rates at 1%, withanannual inflation increase of no more than 2%. The passage of Proposition 13 immediately reduced property tax payments from homes, businesses,and farms by 57%.
The following year, Proposition 4waspassed primarily to clean up language related to taxes and appropriations limits after the wake of Proposition 13. However, there is one phrase in section 8(c) of the proposition text that better defines user charges and user fees:
¯±®¢¤¤£² ³® ¤³¨³¸ ®¥ ¦®µ¤±¬¤³Ǿ ¥±®¬ ȨΔȩ ±¤¦´« ³®±¸ «¨¢¤²¤²Ǿ ´²¤± ¢§ ±¦¤²Ǿ £ ´²¤± ¥¤¤² ³® ³§¤ ¤·³¤³ ³§ ³ ³§®²¤ ¯±®¢¤¤£² ¤·¢¤¤£ ³§¤ ¢®²³² ±¤ ²® ¡«¸ ¡®±¤ ¡¸ ³§ ³ ¤³¨³¸ Restated, any proceeds from user charges and user fees that ¢®²³² ±¤ ²® ¡«¸ ¡®±¤ considered taxes.The legal ability for government agencies to charge fees in California in the wake of all the changes wrought by Proposition 13 comes out of that little phrase. The importance, and #¨³¸ ®¥ "¤«« ' ±£¤² 2¤³ « 2¤¦¨²³±¸ &¤¤ 3³´£¸ !´¦´²³ 20230 ¦¤ Ȟ 6
« ¯¯±®¯±¨ ³¨®² ¡¸ ¤³¨³¸ ¥®± ±¤ ²® ¡«¤ ¢®²³²
¯¯±®¯±¨ ³¤ ¥®± ³§¤ ¢®³¨´ ³¨® ®¥ ²¤±µ¨¢¤ ®µ¤± ³¨¬¤ȁ 4§¨² ¨¢«´£¤² ®¦®¨¦ ¤·¯¤²¤², ²´¢§ ² ®¯¤± ³¨® ¢®²³² £ ±¤ ²® ¡«¤ ««®¢ ³¨® ¥®± ®µ¤±§¤ £ £ £¬¨¨²³± ³¨®Ǿ ¡´³ ¨³ «²® ¨¢«´£¤² ±¤²¯®²¨¡«¤ ««®¢ ³¨®² ¥®± ¢ ¯¨³ « ±¤¯« ¢¤¬¤³Ǿ ¤·¯ ²¨® ®¥
Then, Proposition 218, passed in 1996 and became Articles XIIIC & D, further restricting municipal utility rates charged on property owners. Prop 13, 4 and 218 have had, and will continue to have, a profound effect on California governments.
But it was left to the passage of Proposition 26, passed in 2010, to codify many of the fee setting practices of the previous 30 years. Article XIII C of the State Constitution was amended to formally declare that fees are not considered taxes if they do not exceed the reasonable costs of the service.
Government Code Section 66014 further defined that statement for development fees.
Some of the types of services for which reasonable fees are allowable are:
A charge imposed for a specific benefit conferred or privilege granted directly to the payor that is not provided to those not charged, and which does not exceed the reasonable costs to the local government of conferring the benefit or granting the privilege.
A charge imposed for a specific government service or product provided directly to the payor that is not provided to those not charged, and which does not exceed the reasonable costs to the local government of providing the service or product.
A charge imposed for the reasonable regulatory costs to a local government for issuing licenses and permits, performing investigations, inspections, and audits, enforcing agricultural marketing orders, and the administrative enforcement and adjudication thereof.
Article XIII C also provides that a local government agency must demonstrate that the amount of revenue to be generated by a fee is no more than necessary to cover the reasonable costs of the governmental activity supported by the fee, and that the manner in which those costs are allocated the governmental activity. For example, a fee on liquor store owners to fund an alcohol education program would not be allowed.
While Proposition 26 was built on the foundations of Propositions 4 and 218, it provided a sharper definition of the reach and limits of service fees, and the courts have looked to it when reviewing fee challenges.
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CaliforniaTenantProtectionActof2019
The California Tenant Protection Act of 2019 went into effect on January 1, 2020 and caps rent increases statewide for qualifying units at either 5% plus the increase in the regional consumer price index (CPI),or10% of the lowest rent charged at any time during the 12 months prior to the increasewhichever is less.
It is interesting to note that, with inflation (and thus regional CPI) skyrocketing in 2022-2023, literally the entire state met the 10% of lowest rent threshold rather than the CPI-based threshold, allowing landlords statewide to increase rent up to 10% annually.
Communities wanting further control or customization of their rent stabilization policies may pass by ordinance revised policies and limitations. Local rent increase percentage restrictions may be less than or equal to, but not more than state ceilings. Bell Gardens rent increase limitations of 50% of local CPI or 4%, whichever is less, complies with state law.
Additionally, and subject to the rent cap, state law limits rent increases to only twice over any 12 month periody once per year.
Legal Approach to User Fees
This Fee Study presents the analytical advantages available to the City through the institution of a comprehensive system designed by RCS to implement Article XIIIB of the California Constitution.
Constitutional Methodology. The methodology used for this analysis is the "costs reasonably borne" test established by Section 8(c) of Proposition 4, now Article XIIIB of the California Constitution. In following that process, RCS has analyzed the ways in which City services can be financed more equitably to assure the City's future financial viability.
Full Business Costs Determined. The methodology followed by both the Authors of Proposition 4, and consequently by RCS, determines the full business cost of providing the reported City services.
It also identifies the beneficiaries of those services and determines if they are paying in relationship to benefits derived or if they are deserving of a subsidy paid from the taxes paid by all local citizens and businesses. Thus, the City Council will have full knowledge and cannot ignore costs that are occurring.
Financial Integrity Established. This text summarizes the work accomplished and presents recommendations. These recommendations, if implemented, would firmly establish the financial integrity of the analyzed City services, and would establish a continuing cost control system following the business principles, which are generally espoused for government, but often are ignored in application.
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CHAPTER II IDENTIFYING THE COST OF
SERVICES
RCS was tasked with identifying appropriate staffing to carry s RSTEP program. We identified both a best practice staffing model and a minimal or base-level staffing model. RCS interviewed rent stabilization staff from Inglewood, Santa Monica, and Culver City to determine best practice staffing. Of these programs, Culver City is closest in terms of the number units in their program, community size, and characteristics. The costs determined by RCS for the various services are based on the defini
(Proposition 4) and as further defined by its authors in their background documents. The following are generally accepted elements of "costs reasonably borne."
Cost of Services
a) Labor costs and Employee Related Expenses
b) Operational services and supply expenses
c) Overhead expense
d) Administrative costs
e) Start-up costs
f) Future capital and replacement expenses
g) Costs of expansion of services
h) Repayment of debt
4 ¡«¤ 1Ȁ 3 « ±¸ lj %¬¯«®¸¤¤ Benefits Costs "¤²³ 0± ¢³¨¢¤² Staffing Ͱ ®¥ &4% 3 « ±¸ "¤¤¥¨³ 4®³ «
0±®¦± ¬ 3³ ¥¥¨¦ Employees Costs Costs Costs
License Clerk/Permit Technician 1.0 72,309 37,351 109,660 Administrative Assistant 1.0 72,250 37,320 109,570
Code Enforcement Officer 1.0 65,509 33,838 99,347
Rent Stabilization/Housing Specialist 1.0 88,993 45,969 134,962 Director of Community Development 0.1 19,172 7,856 27,029 4®³ « 0±®¦± ¬ 3³ ¥¥¨¦ 4.1 318,233 162,335 480,568
4 ¡«¤ ΑȀ 3 « ±¸ lj %¬¯«®¸¤¤ "¤¤¥¨³² #®²³² Minimum/Base Level Staffing Ͱ ®¥ &4% 3 « ±¸ "¤¤¥¨³ 4®³ «
0±®¦± ¬ 3³ ¥¥¨¦ Employees Costs Costs Costs
License Clerk/Permit Technician 0.5 36,154 18,676 54,830 Administrative Assistant 1.0 72,250 37,320 109,570
Code Enforcement Officer 0.5 32,754 16,919 49,673
Rent Stabilization/Housing Specialist 1.0 88,993 45,969 134,962 Director of Community Development 0.1 19,172 7,856 27,029 4®³ « 0±®¦± ¬ 3³ ¥¥¨¦ 3.1 249,323 126,740 376,063
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The minimal/base level staffing model reduces the License Clerk/Permit Technician and Code Enforcement Officer positions to part-
Labor and Employee Benefit Costs RCS worked with the City of Bell Gardens to identify the appropriate staffing levels and calculate associated costs. RCS calculated the labor costs based on Bell Gardenscalculated the employee benefit
costs based on the average fringe benefit percentage of each bargaining group.
Operational Services and Supply Expenses - Various contracted services and operating expenses are essential to the RSTEP Program. These include the need for a hearing officer and legal services, registration software, education & outreach services, and additional policy and process development. Other expenses include postage, legal notices, and IT hardware and software.
Indirect Administrative Costs - The purpose of deriving overhead costs is to apportion these amounts to direct service program costs. By adopting this method, the City will be aware of its true costs and be able to mirror business methods.
Bell Gardens administrative functions (ex. Finance, Human Resources, City Office) support other departments and divisions (ex. Community Development, Public Works, Public Safety) without providing a deliverable service to the public. The City Community Development budget for FY 2023-24 does not include expenditures for indirect costs or other unforeseen incidentals. Therefore, RCS included an estimated $160,000, which is 20% of program operating costs. In our minimal staffing plan, we have reduced this figure to 10%, or $75,000 of program operating costs.
Startup Costs The RSTEP Program budget includes both one-time and ongoing costs. For example, the rental registry software to be selected by the City will have an initial program cost of $30,000 for the initial year. Interviews with neighboring rent stabilization programs indicate that legal costs may be higher in the initial year as well. RSTEP policy and process development costs should be reduced or eliminated in future years, as RSTEP Program staff could take over this function.
Future Capital and Replacement Expense, Costs of Expansion of Services, and Repayment of Debt None of these costs apply to the Rent Stabilization Program.
#®¬¡¨¤£Ǿ ³§¤ ¥´«« ¢®²³ ¥®± ³§¤ 234%0 0±®¦± ¬ ¨² ͡1,020,968 ¯¤± ¸¤ ± ´£¤± ³§¤ "¤²³ 0± ¢³¨¢¤² ²³ ¥¥¨¦ ¬®£¤« £ ͡836,620 ´£¤± ³§¤ -¨¨¬ «ȝ" ²¤-L¤µ¤« s³ ¥¥¨¦ ¬®£¤«. Table 3 below presents the line-item budget for the RSTEP first year of operations.
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4 ¡«¤ 3Ȁ 0±®©¤¢³¤£ Budgets £ %²³¨¬ ³¤£ &¤¤
AccountBest PracticeMinimum/Base
0100 Salaries$318,233$249,323
03xx - Fringe Benefits 162,335 126,740
1010 - Office Supplies 6,500 6,500
1200 Postage 6,000 6,000
1302 - Copier Lease 5,000 5,000
1600 - Special Supplies 1,900 1,900
1700 - Uniforms & Protective Clothing 600 600
2043 Telecommunications 1,250 1,250
2050 - Legal Notices 8,000 8,000
2200 - Membership & Dues 650 650
2210 - Conference, Meetings, Travel 1,500 1,500
2230 Vehicle Fuel 4,000 4,000
2710 Training 2,000 2,000
280A - Rental Registration Software 72,000 72,000
280B - Public Outreach 35,000 35,000
280C - Legal Services 100,000 100,000
280D - Hearing Officer 50,000 50,000
280E - RSTEP Policy & Process Development 65,000 65,000 2807 - Translation Services 4,000 4,000
3060 - IT Hardware & Software 7,000 7,000
9999 - Indirect Administrative Costs 170,000 75,000
$1,020,968
Total Budget $821,463
6,539
Estimated Number of Rental Units 6,539
$156
Required Fee Per Unit $126
$6.50
Allowable Monthly Pass-Thru to Renters $5.25
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CHAPTERIIIALLOCATINGTIMEANDUNITS
AvailableWorkHours
The available work hours by position arebased on current labor contracts.Available work hours were calculated as the total possible workhours in a year(2,080)minus the away-from-work benefit hoursfrom holidays, vacations, personal leave, sick leave, morning/afternoon breaks, and start up/down time.
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Group3³ ±³¨¦ (®´±²Hours
Directors
Ȩ$¨±¤¢³®± ®¥ #®¬¬´¨³¸ $¤µ¤«®¯¬¤³ȩ
Middle Management
(#¨³¸ Plann¤±Ǿ "«£¦3¤±µ¨¢¤² 3´¯¤±µ¨²®±)
2,0801,571
CEAGeneral Employees
(#®£¤ %¥®±¢¤¬¤³ȝ"´¨«£¨¦ )²¯¤¢³®±Ǿ ,¨¢¤²¤
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The 4.1full-time equivalent city employees within the Rent Stabilization Program equals 6,443total ΔΓΓω ®¥ ³§¤
available work hours.Forthe Fee Study, 100% of the available work hoursforall City employees were . In other words, one staff member cannot state
µ ¨« ¡«¤ ¶®±ª
they overworked on fee services beyond 100% of their hours, and another staff member cannot §®´±² for «« 230
account for 100% of their time. Their time wasdistributed to those program tasks where the time ¤¬¯«®¸¤¤² ¶¤±¤
would be expended.
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IdentifyingServiceDeliveryAreas
From reviewing the Rent Stabilization and Just Cause Eviction Ordinance, we have divided the ¯´¡«¨¢ ²¤±µ¨¦ȁ
RSTEPProgram into the following service delivery areas:
Service Delivery Area
1.Registration Section 5.62.090
2.Petition Process
3.Enforcement and Compliance Section 5.62-110, 5.63.080, and 5.63.090
4.Hearings and Appeals Section 5.62.120, 5.62.130, 5.63.090 and 5.63.100
5.Tenant Eviction Protections -Section 5.63.030
6.Administration
For each of the service delivery areasabove, we further identified relevant program tasks. The program tasks were created basedonrequirements ofthe RSTEP Ordinance. This helps us estimate the percentageof available work hours for each City staff. #¨³¸ ®¥ "¤«« ' ±£¤² 2¤³ « 2¤¦¨²³±¸ &¤¤ 3³´£¸ !´¦´²³ 20230 ¦¤ Ȟ 12
Since the Rent Stabilization Program is a new endeavor for the City of Bell Gardens, reasonable assumptions were made to the times required for each task. It was a collaborative effort, engaging Ciexperience in
. We referred
to Stabilization and Just Cause Eviction O
stabilization program annual reports to identify trends in annual services provided. The allocation of time to tasks required several reviews before everyone was comfortable with the results.
4 ¡«¤ ΔȀ !««®¢ ³¨® ®¥ 4¨¬¤
#)49 /& "%,, '!2$%.3,¨¢¤²¤ #®£¤ $¨±¤¢³®± ®¥
!,,/#!4)/. /& 4)-%#«¤±ªȝ0¤±¬¨³ !£¬¨ %¥®±¢¤¬¤³ 2¤³ 3³ ¡¨«ȝ #®¬¬ $¤µ 02/'2!- 4!3+3TechnicianAssistantOfficer(®´²¨¦ 3¯¤¢ȨΏȁΐ &4%ȩ ΐȩ 2¤³ « 2¤¦¨²³± ³¨® ȃ 3¤¢³¨® ΔȁΕΑȁΏΘΏ 70%30%5%10%0% Rental Registry Fee (New) - Section 5.62.090
Annual Re-Registration - Section 5.62.090
Notice of New Tenancy - Section 5.62.090
Change of Onwership - Section 5.62.090
Verification of Exemption - Section 5.62.030
Termination of Exemption - Section 5.62.030(C)
Registration Fee Collection - Section 5.62.090(C)
Fee Waiver for Owner Occupied - Section 5.62.090(C.1)
Maximum Allowable Rent calculation - Section 5.62.040
Below Market Rent Increase - Section 5.62.050(3)
Notice of Pass Thru Review - Section 5.62.100(B)
Notice of Tenant Rights - Section 5.63.070
General Inquiries (Phone Calls & Walk Ins)
Αȩ 0¤³¨³¨® 0±®¢¤²² 10%20%10%15%0%
Capital Improvement Pass-Through - Section 5.62.060
Landlord Fair Return - Section 5.62.070
Tenant Rent Adjustment - Section 5.62.070(B)
10%15%50%10%10%
ΔȁΕΒȁΏΗΏǾ £ ΔȁΕΒȁΏΘΏ
Notices of violation/complaints
Code Enforcement Inspections
Citations, Prosecutions & Litigations
Case correspondence and record keeping
0%10%10%10%40%
ΔȁΕΒȁΏΘΏ £ ΔȁΕΒȁΐΏΏ
Administration of Petitions, Hearings and Appeals
Judicial Review - Section 5.62.130(D.2)
Δȩ 4¤ ³ %µ¨¢³¨® 0±®³¤¢³¨®² ȃ 3¤¢³¨® ΔȁΕΒȁΏΒΏ 0%5%5%5%0% Notice of Termination of Tenancy - Section 5.63.030(B.5) Review Possession for Family Use - Section 5.63.030(D.2.c) Oversight of relocation assistance - Section 5.63.040
Tenant Buyout Agreements - Section 5.63.050
Assistance and mediation for Tenant Eviction
Εȩ !£¬¨¨²³± ³¨®10%20%20%50%40%
Budget, Staffing, Training, Department Coordination
Policy/Program Development, Legal Compliance
Education & Outreach
Agency Liaison & Regional/State representation
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IdentifyingtheNumberofUnits
The City of Bell Gardens staff estimate that 6,539 rental units are covered under the RSTEP Ordinance and receive a proportional benefit of rent stabilization and eviction protection under the RSTEP Program.
Since the RSTEP Program has been in operation for less than one year, RCS does not have actual data for tasks and services to be performed. The table below represents unit counts from the cities of Oakland and Alameda annual reports. This should help Bell Gardens anticipate workload levels. Appendix B contains the full comparison of city annual reports that RCS was able to obtain.
#¨³¸ ®¥ / ª« £ Ȩ&9ΑΏȩ "¤«« ' ±£¤²
.´¬¡¤± ®¥ 5¨³² 0¤± ΐΏΏ Pro-Rated
TOTAL Units 14,822 6,539
Eviction/Vacation Notices 4,696 31.68 2,072
Move-Out Disclosure Certification Forms 221 1.49 97
Move-Out Relocation Agreements 62 0.42 27
Petitions Filed 599 4.04 264
Mediation & Settlement Conferences 47 0.32 21
Petitions (Appeals) Submitted to Board 634 4.28 280
Appealable Decisions 406 2.74 179
Number of Appeals Heard 56 0.38 25
Resolved at End of FY 51 0.34 22
!« ¬¤£ Ȩ&9Αΐȩ
Bell Gardens
.´¬¡¤± ®¥ 5¨³²
Per 100 Pro-Rated
FULLY Regulated Units 12,174
PARTIALLY Regulated Units 1,887
TOTAL Units 14,061 6,539
Submission for Rent Review or Registration 147 1.05 68
Petitions filed for rent adjustment 40 0.28 19
Termination of Tenancy Submissions 19 0.14 9
Buyout Agreement Submissions 21 0.15 10
Temporary relocation submissions 6 0.04 3
Capital improvement plan submission 1 0.01 0
Units monitored for compliance after "no fault" 68 0.48 32 termination
Referrals for enforcement 10 0.07 5
Public records requests 15 0.11 7
Decisions by hearing officers 11 0.08 5
Staff review of rental registration 964 6.86 448
(errors/issues)
Referred to Legal - Enforcement of Ordinance 20 0.14 9
violations
Referred to Legal - Registration Errors 197 1.40 92
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CalculatingtheUserFee
While most city services are paid by local tax dollars, cities also adopt user fee schedules to recover costs for fee services, such as recreation classes, planning applications, public works inspections, and building permits. The legal test for a user feeare:
The customer is identifiable
The service is measurable (e.g., time or cost)
The service benefits an individual or group, and the use is exclusive
The RSTEP Program is designed to serve the landlords and tenants and exclude homeowners and businesses owners. The tasks and services within the RSTEP program proportionately serve all landlords and tenants, therefore, RCS recommends a single, flat Annual Registration Fee.
The City will have more data after several years of operations and should recalculate the Annual Registration Fee then. At that time, the City could also consider separate fees for petition filing, which typically take a significant amount of staff time and resources to process.
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CHAPTER IV COST RECOVERY
RECOMMENDATIONS
Suggested Rental Registry Fee
RCS has calculated that the fee required to offset the cost of the RSTEP program will be either $156 or $126 per unit, depending on which staffing plan the City Council ultimately adopts.
Total Projected Required Fee
Rental Registration Fee Budget # of Units Per Unit
Best Practice Staffing Plan $1,020,968 6,539 $156
Minimum/Base Level Staffing Plan $821,463 6,539 $126
After timely payment of the Registration Fee, the landlord may pass through up to fifty percent (50%) of the Registration Fee to tenants of the applicable rental unit, to be paid by the tenant in twelve (12) equal monthly installments. This translates to $6.50 or $5.25 per month to be paid by the tenant.
Other Considerations
Achieving high registration compliance in Bell Gardens may be difficult with the current RSTEP Ordinance because there are few fines or penalties for landlords who do not register or pay the ability to rent out or collect rent when they are noncompliant. Bell Gardens may wish to consider updating the RSTEP Ordinance to include similar language.
The RSTEP Ordinance does not address the fine for late payments of the registry fee. Establishing the appropriate penalties is necessary to ensure compliance with the RSTEP Ordinance. Fines are not governed by Propositions 13, 4, 218 and 26, and the City may set the terms and amounts to what is appropriate and reasonable for the City. RCS recommends the following fee/late fee for the City based upon best practices from other jurisdictions with a rent stabilization ordinance:
, ³¤ &¤¤² ²³ ±³¨¦ ® /¢³®¡¤± 31 4®³ « &¤¤² lj &¨¤²
If paid late, 30 days or less past October 31 Registry Fee + 10% of remaining balance due If paid 31 to 60 days past October 31 Registry Fee + 25% of remaining balance due If paid after 60 days past October 31 Registry Fee + 50% of remaining balance due
Finally, RCS recommends creating a special revenue fund to account for all RSTEP Program revenues and expenditures. This separation from the General Fund will help the City manage the program and ensure full cost recovery. The fund should build up and maintain a 20% fund balance reserve.
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CHAPTER V RENT STABILIZATION BOARD
Consideration of a Board
Most rent stabilization and renter protection programs utilize a board. However, several of the smaller programs do not. Rent stabilization boards can either be made up of elected or appointed members. If appointed, members are usually a mix of both tenants and landlords to ensure both groups are represented. Typical appointed rent stabilization boards include two tenants, two landlords, and one homeowner. For boards that are elected, of course, the City has no control over the housing status of the various members. Most rent stabilization boards meet 16 times per year.
Meeting less often prevents timely review of exemption and other board-level requests.
The primary duties of a rent stabilization board include setting rent increase restrictions, reviewing applications for unit exemptions from landlords and complaints from tenants regarding needed repairs. Most exemption applications are prepared for the Board administratively, provided the owner submits the required documentation. Staff prepare a recommendation for the Board, and the Board then determines whether to grant the exemption. In some instances, applications are referred to a contract Hearings Officer for evidentiary hearings to determine if the owner-applicants meet all the requirements to qualify for this exemption. In these cases, a hearing officer makes a decided by the courts.
Bell Gardens
aggrieved by an administrative decision of a hearing officer pertaining to a request for appeal of a Director's decision under this Chapter, may seek judicial review in the Court pursuant to Government Code Section 53069.4 and/or Code of Civil Procedure Sections 1094.5 and 1094.6. If the City were to consider a rent stabilization board, the Bell Gardens RSTEP ordinance would have to be amended to account for the board and procedures similar to other City commissions.
Establishing and coordination with a Rent Control Board would require the following:
Developing board nominations, terms, responsibilities, and rules.
Provide adequate Board training and coordinate responsibilities among all parties.
Identify staff who will coordinate all meetings and communications, including legal.
Other Cities
RCS and Bell Gardens staff interviewed R¤³ Control Agency staff to understand the duties of their Board.
residents, which makes them unique to Bell Gardens. Their Rent Control Board was established to act independently from the City, and outside the control of the City Council. Their Rent Control Program operates 100% from fees and does not require any General Fund subsidy.
Rent Control Agency Director stated they could not function without a Board. is made up of five elected commissioners with the following duties:
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(1) Set the rent ceilings for all controlled rental units at fair and equitable levels. (2) Hire and pay necessary staff, including hearing examiners and personnel to issue orders, rules and regulations, conduct hearings and charge fees. (3) Make such studies, surveys and investigations, conduct such hearings, and obtain such information as is necessary to carry out its powers and duties. (4) Report annually to the City Council on the status of controlled rental housing. (5) Evaluate petitions for removal of units from the program are warranted based on inability to make a fair return.
(6) Administer oaths and affirmations and subpoena witnesses. (7) Establish rules and regulations for deducting penalties and settling civil claims under Section 1809.
(8) Refer violations to appropriate authorities for criminal prosecution.
Each commissioner receives a $75 allowance per meeting. Santa Monica conducts 16 rent control meetings per year, for a total cost of $6,000. The Board also has a Board Secretary who assembles the Board packets and attends meetings. The Board Secretary has many other res-to-day operations such as processing and paying bills. The personnel-related costs of the Board Secretary are approximately $100,000.
RCS interviewed ,®¦ Term 2¤³ « $¨µ¨²¨® to
understand the duties of their Rent Housing Board.
members, with four being either a residential landlord or owner and the fifth being a City employee.
Board members are nominated by City Councilmembers and appointed by the Mayor. The Rent Housing Board is responsible for hearing disputes between tenants and their landlords, and either approving or denying requests to charge back capital improvements to tenants. Inglewood staff shared with RCS that the primary reason for the creation of their Board was their City Council did not want to be involved with the duties and decisions of the program.
Finally, RCS and Bell Gardens staff interviewed
Program staff. Culver City does not use any Board, Commission or Committee for hearings or appeals. We asked their staff why Culver City decided against creating a rent stabilization board, and upon whom the traditional duties of a Board fall upon at Culver City. They responded with:
¡¤¢ ´²¤ ®¥ ³§¤ ²¨¹¤ ®¥ ³§¤ ¢¨³¸ £ «¨¬¨³¤£ ±¤²®´±¢¤² ¶¤ § £ µ ¨« ¡«¤ ³ ³§¤ ³¨¬¤ȁ 4± £¨³¨® « £´³¨¤² ®¥ ³§¤ ¡® ±£ ±¤ § £«¤£ £¬¨¨²³± ³¨µ¤«¸ȁ !² ¯±¤µ¨®´²«¸ ¬¤³¨®¤£Ǿ ¶¤ ¢®³± ¢³ ¶¨³§ µ ±¨®´² ¢®²´«³ ³²ȝµ¤£®±² ³® ¬®µ¤ ¨³¤¬² ¥®±¶ ±£ȁ ! «¸²¤² ®¥ ¯¯«¨¢ ³¨®² £ ¯¤³¨³¨®² ±¤ £®¤ ¡¸ ®´± ¢®²´«³ ³Ǿ "!% 5±¡ %¢®®¬¨¢²Ǿ ¶§¨¢§ ¶¤ ³§¤ ´²¤ ³® ¨²²´¤ ¥¨ « £¤¢¨²¨®ȁ )¥ ³§¤±¤ ±¤ ¯¯¤ «²Ǿ ³§®²¤ ±¤ ³§¤ §¤ ±£ ¡¸
#¨³¸ ®¥ "¤«« ' ±£¤² 2¤³ « 2¤¦¨²³±¸ &¤¤ 3³´£¸ !´¦´²³ 2023 0 ¦¤ Ȟ 18
Culver City staff pointed out program revenues typically ramp up over a three-year period as enforcement efforts.
Similarly, Inglewoodrent stabilization program recorded a compliancerate in the 50% range in their first year of operation, and now most recently achieved an 89% compliance rate in their third year of operation.
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CHAPTER VI RENTAL REGISTRY SOFTWARE
Bell Gardens has three available rental registry software options.
ΐȁ Permit Tracking Software The City is currently in the process of selecting permit tracking software for its development operations (Planning, Building, Engineering). This software may be used for rental registry purposes as well. The cost would have to be presented as an additional option with the selected firm.
Αȁ .¤¶ 2¤°´¤²³ ¥®± 0±®¯®² «² The City also has the option to prepare an RFP for rental registry software that may be more specific to the needs of the rental registry program and in line with what other cities with rent stabilization programs already use. This specific software includes support for cleaning, preparing, and uploading housing data to a cloud-based database, a portal for property owners to log-in, review, and correct information, data dashboards, and customized support.
Βȁ %·¨²³¨¦ HdL Software HdL is the current provider of business license software for Bell registry. Such integration might be beneficial for cross-checking purposes. HdL rental registry software clients include Concord, Culver City and Pomona.
The costs for this necessary software can range from $72,000 to $144,000.
Conclusion
It is recommended that the City staff discuss the software needs with the permit tracking firm selected as part of the current RFP process to see if the needs can be met and compare them with HdL services. If the City finds neither alternative satisfactory, then the City may elect to issue a new RFP specific to rental registry software and related services.
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APPENDIX A RENT STABILIZATION AND JUST CAUSE EVICTION ORDINANCE
APPENDIX B SURVEY OF RENT STABILIZATION PROGRAMS
SurveyofRentStabilizationPrograms
0®¯´« ³¨® 2¤³ 2¤µ¨¤¶ 2¤³ «
ApprovedOrdinance(2020"® ±£ȝ 2¤¦¨²³± ³¨® Rental
JurisdictionBy%¥¥¤¢³¨µ¤ $ ³¤Census)CommitteeRequired2¤¦¨²³± ³¨® &¤¤ Alameda CityCity Council9//1978,280Rent Review Required$155/fully regulated Advisory units; $105/partially
Committeeregulated units;
$0/rental units occupied
by subsidized tenants
Baldwin ParkCity Council12/4/19 effective 72,176NoneRequired$28/unit 1/3/20.
BerkeleyVoterRent Stabilization 124,321Rent Stabilization Required$250/full regulated unit; 6/3/80; Tenant Board$150/partially regulated
Buyout 3/14/17. ADUunits; $37/subsized unit;
Clarification, $70/summer
Emergency Exemption sorority/fraternity
11/3/20.outside member rental
unit
Culver CityCity CouncilMediation: 5/11/19. 40,799NoneRequired$167/unit Rent Control and
Tenant Protections,
10/30/20.
East Palo AltoCity CouncilTenant Protections 30,034Rent Stabilization Required$222/non-exempt unit 5/6/14; Rent Board
Stabilization
06/08/2010. Last
amended 11/8/16.
HaywardCity Council6/25/19 effective 162,954NoneNot RequiredComplaint Based Fees 7/25/19.$40/residential covered
rental unit,
$19/residential rental
unit
InglewoodCity Council5/19/2011107,762Rental Housing Required$206/unit Board$92/unit Section 8
Los Angeles CityCity Council4/21/79. Last 3,898,747Rental Housing Required$38.75/unit amended 5/20.Oversight
Commission
OaklandCity Council10/7/80. Last 440,646Residential Rent Required$101/unit amended 6/4/2019.and Relocation
Board
RichmondVoterFair Rent adopted 116,448Rent BoardRequired$218/unit fully covered, 11/08/16. Relocation $123/unit partially
adopted 12/20/16, covered and
effective 01/2017.govermentally subsidized
San FranciscoBoard of 6/79. Last amended 873,965Rent BoardRequired$59.00/apartment unit, Supervisors12/19.$29.50/residential hotel
room
Santa AnaCity Council10/19/2021310,227TBDTBD$100/unit
Santa MonicaVoterCharter: 4/10/79. Last 93,076Rent Control Required$198/unit amended 2010.Board
Tenant Relocation:
2/27/90 last amended
3/28/17.Tenant
Harassment:
10/10/95 last
amended 01/13/15.
Unincorporated Los Board of Effective 04/1/20.1,057,162Rental Housing RequiredBefore 4/22 - Free, May - Angeles CountySupervisorsOversight Sept 2022 - $90/fully Commissioncovered units
West HollywoodCity Council6/27/85. Last 35,757Rent Stabilization Required$144/unit full amended 12/2019.Commission$60/unit partial
APPENDIX C RENT STABILIZATION POLICIES OF CALIFORNIA CITIES - 2023
RentStabilizationPoliciesofCaliforniaCities-2023
MunicipalityRestrictionOrdinance
Alameda Landlords are limited to the base rent charged as of 9/1/19 plus Alameda, the Annual General Adjustment (AGA). For tenancies beginning California after 9/1/19, the base rent is the initial rent amount. The AGA is Code of calculated using 70% of the regional Consumer Price Index Ordinances §§ (CPI), with a 1% floor and 5% ceiling. Each year in May the 6-58.10 - 6- Program Administrator announces the AGA effective September 58.155 1st. A Landlord who does not increase rent by the full amount allowed annually can "bank" the unused portion and impose it in a later year. A new AGA of 3.5% went into effect on September 1, 2022. However, special Pandemic "wind-down" rules apply. See the Alameda Rent Program FAQ.
Antioch Effective 7/23/22 landlords may increase rent once every 12 Antioch months, limited to 60 percent of the local CPI or 3%, whichever Municipal is less. Single-family homes without accessory units, Code Title 11, condominiums and cooperatives are exempt as are units first Chapter 1. §§ certified for occupancy after 2/1/95. 11-1.01 - 11-
1.013. Rent
Stabilization.
Baldwin Park Rent is effectively limited to 5% per 12-month period (based on Baldwin Park the Consumer Price Index) of the "base rent ceiling" (rent in Code of effect on 3/5/19, or if none the initial rent charged on the first Ordinances day of tenancy). Chapter 11
§§ 129.01 -
129.78
Bell Gardens Rent increases are limited to 50% of the local CPI or 4%, Bell Gardens whichever ls less. Municipal
Code
Chapter 5.62,
"Rent
Stabilization",
and Chapter
5.63,
"Tenant
Eviction
Protections".
Berkeley Each January 1st rent ceilings are increased by the Annual Berkeley General Adjustment (AGA). The AGA is set by October 31 of the Municipal preceding year, but has been 65% of the percentage increase of Code §§ the regional Consumer Price Index (CPI) since 2005. Landlords 13.76.110 - or tenants may petition for exception. 13.76.120
Beverly Hills Landlord may increase rent once every 12 months, limited to 3% Beverly Hills of the current rent, or the regional Consumer Price Index (CPI), Municipal whichever is higher. Code § 4-6-3
City of Rent increases are expressly subject to the provisions of AB City of Commerce 1482 California Tenant Protections Act (Cal. Civ. Code §§ 1946.2 Commerce and 1947.12). Municipal
Code §§
19.40.010 -
19.40.090
MunicipalityRestrictionOrdinance
Culver City The rent as of 10/30/20 on then-existing tenancies, or the initial Culver City rent charged on tenancies beginning thereafter, is the "base rate" Municipal from which increases are calculated. Increases are limited per Code §§ 12-month period to the average annual change in the Consumer 15.09.200 - Price Index (CPI) with a cap of 5%; if the CPA increase is less 15.09.270 than 2%, the cap is 2%. Landlords can petition for an increase above the cap amount. (CCMC § 15.09.215).
East Palo Alto Annual rent increases are limited to 80% of the percentage East Palo Alto, increase in the regional Consumer Price Index (CPI). Overall California increase may not exceed 10% in any 12-month period. Code of Ordinances §§
14.04.040,
14.04.090 -
100
Fairfax Rent increases are limited to 60% of the percentage increase in Fairfax Town the regional consumer price index (CPI) annually. Overall Code increase may not exceed 5% total. The cap is retroactive to Title 5, 2/2/22. Business.
Chapter 5.55
"Rent
Stabilization
Program" §§
5.55.010-
5.55.120.
"Floating home "Floating home marinas" with five or more floating home berths CA Civ. Code § marinas" cannot increase rent by more than 3% plus inflation up to a 800.4 et sec. maximum of 5% per year.
Gardena Rent increases exceeding 5% are subject to mediation and Gardena binding arbitration. Municipal
Code §§
14.04.010 -
14.04.300
Glendale No limit on rent increases, but increases exceeding 7% over any Glendale 12 month period may trigger relocation payments if tenants Municipal choose to vacate rather than renew. Code §§
9.30.10 -
9.30.100
Hayward Rent increases are limited to 5% per year absent exception. Hayward Landlords may "bank" annual increases, but aggregate rent Municipal increases cannot exceed 10% in any year. Code
§§ 12:1.01 -
12:1.21
MunicipalityRestrictionOrdinance
Inglewood The base rent amount for calculations is the rent in effect on Inglewood 6/18/19 or the initial rent for tenancies starting thereafter. Only Municipal one increase is allowed every 12 months, calculated from the Code §§ 8-125 day the increase first takes effect.-8-234
For residential properties with five or more units, the maximum increase is 3% or the cost of inflation (whichever is greater), as measured by the local CPI. The increase cannot exceed 10%.
For residential properties with four or less units, the maximum increase is 5% PLUS the cost of inflation as measured by the local CPI. The increase cannot exceed 10%.
Los Angeles Only one rent increase is allowed every 12 months based upon Los Angeles the regional Consumer Price Index (CPI). Effective July 1, 2020, Municipal the annual allowable increase is 3%. Code §§
151.00 -
155.09
Unincorporated Only one rent increase is allowed annually, based on the change Los Angeles Los Angeles in the regional Consumer Price Index (CPI) up to a total of 8% County Code County including pass-throughs and fees. §§ 8.52.010 -
8.52.200
Los Gatos Rent may be increased only once annually and the increase Los Gatos cannot exceed the greater of 5% of existing rent, or 70% of the Town Code §§ regional Consumer Price Index (CPI). The landlord can always 14.80.010 - increase rent with tenant's written consent. 14.80.315
Mountain View Rents may be raised starting September 1st each year by board-Mountain determined amount that is no less than 2%, nor more than 5%, View Code of of the existing rent. Landlords may "bank" annual rent increases. Ordinances §§ 1700 - 1720
MunicipalityRestrictionOrdinance
Oakland Rent may be increased once in any twelve-month period. Oakland Increases are limited based upon the local Consumer Price Index Municipal (CPI) or to prior "banked" increases, but cannot exceed 60% of Code § the percentage increase in the CPI for April of that calendar year 8.22.065 et from April of the immediately preceding calendar year, or 3%, seq. whichever is lower. From 8/1/22 through 7/31/23 the limit is 3%. However, landlords may increase rent up to 5% for each qualifying additional tenant. Owners may also increase the rent when a tenant doesn't use the unit as a principal residence.
Subtenants are also protected from overcharging by primary tenants.
Oxnard Rent increases are limited to 4% annually, and one increase in Oxnard City any twelve (12) month period. Code §§ 27-21
27-23
Palm Springs Only one rent increase is allowed annually, limited to 75% of the Palm Springs increase in the regional Consumer Price Index (CPI). Rent Municipal control is permanently removed after the tenant voluntarily Code §§ vacates or is evicted for cause. As a result, few properties remain 4.02.010 - subject to rent control. 4.08.190
Pasadena Only one rent increase is allowed annually, limited to 75% of the Pasadena increase in the regional Consumer Price Index (CPI). Municipal Code §§ 1801-
1824
Richmond Only one increase is allowed annually, limited to the lower of Richmond either 60% of the increase in the regional Consumer Price Index Code of (CPI), or 3% of current rent, whichever is lower. Ordinances §§
11.100.010 -
11.100.130
Sacramento Rent increases cannot exceed 5% plus the percentage of annual Sacramento increase in the cost-of-living adjustment promulgated by the U.S. City Code Department of Labor, Bureau of Labor Statistics. The total §§ 5.156.010 - increase is capped at 10% annually, and only one increase is 5.156.150 allowed in any 12-month period.
San Francisco Annual rent increases are limited to 60% of the regional San Francisco Consumer Price Index (CPI). Administrative
Code § 37.3
San Jose The "Annual General Increase" is limited to the monthly rent for San Jose the previous 12 months, multiplied by 5% via one annual Municipal increase. The Landlord must petition for a higher increase. Code §17.23.310
MunicipalityRestrictionOrdinance
Santa Ana Santa Ana
Municipal
Rent increase are expressly For buildings build on or before Code §§ 8-
1/1/95, annual rent increases are limited to the lower of 3% per 1998.1 8-
year, or 80% of the percent change in the Consumer Price Index 1998.3.
over the most recent 12-month period. The allowable increase is published no later than June 30 of each year.
Santa Barbara Rent increase are expressly subject to the provisions of AB 1482 Santa Barbara California Tenant Protections Act (Cal. Civ. Code §§ 1946.2 and Municipal 1947.12). Code §§
26.50.010 -
26.50.070
Santa Monica The Rent Control Board determines each year's increase Santa Monica ("General Adjustment" or GA). The Maximum Allowable Rent City Charter (MAR) for any unit is its base rent plus the increase allowed per Amendment the annual GA. §§ 1800 -
In November 2022 voters approved Measure RC, which caps 1821 future general adjustments at 3% beginning February 2023, and reduces the MAR to .8% through August 2023 - effectively bringing the 2023 average rent increase to 3%. The city has a helpful webpage for determining allowable increases here.
Thousand Oaks Rent control is very limitedit only applies to tenants who have Thousand resided in the same unit since 1987. Oaks Rent
Stabilization
Ordinances
Nos. 755-NS,
956-NS, 1284-
NS
West Rent increases are limited to 75% of the increase in the regional West Hollywood Consumer Price Index (CPI) during the preceding 12 months. Hollywood Municipal
Code §§
17.36.020 et
seq.
ŷƷƷƦƭʹΉΉǞǞǞ͵Ɠƚƌƚ͵ĭƚƒΉƌĻŭğƌΏĻƓĭǤĭƌƚƦĻķźğΉĭğƌźŅƚƩƓźğΏƩĻƓƷΏĭƚƓƷƩƚƌΏƌğǞ͵ŷƷƒƌ 3®´±¢¤Ȁ .®«®ȁ¢®¬ ¶§®««¸ ®¶¤£ ²´¡²¨£¨ ±¸ ®¥ -( 3´¡ )Ǿ ,,#
APPENDIX D CULVER CITY RENT STABILIZATION BUDGET
#´«µ¤± #¨³¸ 2¤³ 3³ ¡¨«¨¹ ³¨® 0±®¦± ¬
&9 2023-ΑΓ 0±®¯®²¤£ "´£¦¤³ - Summary
Mike Balkman
City of Culver City
Council Chambers
9770 Culver Blvd.
Culver City, CA 90232
(310) 253-5851
Staff Report
File #:23-1087,Version:1 Item #:C-10.
CC-CONSENTITEM:(1)ReceiptofProgressReportontheStatusofImplementationofthe RentControlandTenantProtectionsOrdinances(“Program”);(2)ApprovalofanAmendment totheExistingProfessionalServicesAgreementwithBAEUrbanEconomicsinanAmount Not-to-Exceed$63,195forImplementationandSupportServicesRelatedtotheProgram;(3) ApprovalofanAmendmenttotheExistingProfessionalServicesAgreementwithTripepi SmithandAssociatesinanAmountNot-to-Exceed$32,610forPublicCommunications SupportfortheProgram;(4)ApprovalofanAmendmenttotheExistingProfessionalServices AgreementwithHdLinanAmountNot-to-Exceed$110,000forMaintenanceoftheRentalUnit RegistrationSystem;and(5)ApprovalofanAmendmenttotheExistingProfessionalServices AgreementwithBetTzedekinanAmountNot-to-Exceed$148,736forLegalServicesRelated to Landlord-Tenant and Other Housing Issues to Culver City Residents.
Meeting Date:June 26, 2023
Contact Person/Dept.:Shannon Louis/Housing and Human Services Phone Number: (310) 948-2268
Fiscal Impact: Yes \[X\] No \[\]General Fund: Yes \[X\] No \[\] Attachments:Yes \[\] No \[X\]
Public Notification: ((E-Mail) Meetings and Agendas - City Council (06/22/2023) ; Landlord Tenant Mediation Board (06/13/2023); and Advisory Committee on Housing and Homelessness (06/20/2023) Department Approval:Tevis Barnes, Housing and Human Services Director (06/10/2023) ______________________________________________________________________
RECOMMENDATION
Staff recommends the City Council:
1)ReceiveaprogressreportonthestatusofimplementationoftheRentControlandTenant Protections Ordinances; and,
2)ApproveanamendmenttotheexistingprofessionalservicesagreementwithBAEUrban Economicstoincludethedevelopmentofguidelines,procedures,andadditionalmaterialsto implementtheprocessesrelatedtoNoFaultEvictionswithconsiderationofStateSB8 requirements,finalizeaStaffHandbook,andprovideongoingpetition,application,andform support in an amount not to exceed $63,195; and,
3)ApproveanamendmenttotheexistingprofessionalservicesagreementwithTripepiSmith City of Culver CityPage 1 of 5Printed on 6/22/2023
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File #:23-1087,Version:1 Item #:C-10.
andAssociates(TSA)tocontinuethepubliccommunicationsprogramfortheRentControland Tenant Protections Ordinances in an amount not-to-exceed $32,610; and, 4)ApproveanamendmenttotheexistingprofessionalservicesagreementwithHdLtocontinue maintenanceoftheonlineresidentialrentalregistrationsystemandeducationandcompliance services in an amount not-to-exceed $110,000; and,
5)ApproveanamendmenttotheexistingprofessionalservicesagreementwithBetTzedekto continueprovidinglegalservicesrelatedtolandlord-tenantandotherhousingissuestoCulver City residents in an amount not-to-exceed $148,736.
BACKGROUND
TheCity’sRentControlandTenantProtectionOrdinanceswentintoeffectonOctober30,2020, permanentlyestablishingrentcontrolandtenantprotectionsintheCity(collectively,“Ordinance”).On May24,2021,theCityCouncilapprovedanannualregistrationfeeof$167perresidentialrental unittocoverthereasonablecostsassociatedwithadministeringtheRentControlandTenant Protections Program (Program).
DISCUSSION
Rent Control and Tenant Protections Program Progress
Overthepastfiscalyear,theHousingandHumanServices(HHS)Departmenthasmadesignificant progressintheimplementationoftheProgram.Duringthepast12months,Programstaffhas receivedatotalof2,973inquiriesviacalls,emails,andwalk-insfromthepublicwithevictions,rent increases,anduntenantableconditionsservingastheleadingtopicsofinterest.Therehavebeen twoPetitionsforNoncompliance,twoApplicationsforRentAdjustments,andtwoCapital ImprovementPass-ThroughApplicationsfiledthisfiscalyear.TheProgramiscurrentlyat81% compliancewithrespecttorentregistrationsandstaffhasactivelyconsultedwithitsvendors,HdL andTSA,toincreasecomplianceandawarenessoftheregistrationrequirementsintheCity.In additiontocoordinatingwithHdLandTSAonregistrationmatters,staffhasworkedwiththe consultantswhowillbediscussedinthisreporttoimplementtheremainingProgramandOrdinance requirements.
Guidelines and Procedures Development: BAE Urban Economics (BAE) TheCityretainedtheservicesofBAEUrbanEconomics(BAE)inJuly2019toconductarentstudy fortheInterimRentControlOrdinance(IRCO).TheCityhascontinuedtousetheirservicesasthey are needed to complete the full establishment and implementation of the Ordinances.
StaffcontinuestoworkwithBAEtodevelopwrittenmaterialsinalignmentwithindustrystandards andCulverCityspecificrequirementstoenforcetheprovisionsoftheOrdinances.BAEsupportsthe Programthroughitsresearchanddevelopmentofordinancerequiredmaterialsandprocesses.In Phase3ofitsworkwiththeCityintheimplementationoftheOrdinances,BAEwillbedeveloping guidelinesandprocedurestosupporttheevaluationofNo-FaultEvictionsandtheapplicationof StatelawunderSB8todemolitionrelatedevictions,finalizingtheadministrativehandbook identifyingoperationalprocedures,andprovidingongoingsupportinevaluatingapplicationsfor City of Culver CityPage 2 of 5Printed on 6/22/2023
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upwardordownwardrentadjustments.BAEwillalsoreviewCitydraftedmaterialstoensure compliancewiththeOrdinanceandidentifyanyareasrequiringresearchofindustrystandardswhere theOrdinanceissilent.TocontinuesupportingtheProgram’simplementationefforts,BAEhas proposed a total budget not to exceed $63,195.
Rent Registration - HdL
TheRentControlOrdinancerequireseachlandlordtoregisterwiththeCityeachrentalunitbyJuly 31annually,andeachunitmustbeissuedaregistrationcertificate.TherentregistryallowsCulver CitytocollectrentalhousingdataandbetterunderstandtheCulverCityrentalmarketplace.The ’sconsultant,HdL,iscurrentlyresponsibleforcollectingandmaintainingrentregistrydataforthe City.Todate,5,287ofthe5,561totalunitsfromthepreviousyearhavebeenregisteredfortheJuly 31,2022,registrationperiod,placingtheProgramat94%forrenewalsfromthepreviousregistration periodand81%foroverallaccountregistrations.Therehasbeen$913,738.50infeesandpenalties collectedforthesameregistrationperiod.StaffhascontinuedtocollaboratewithHdL,toaidinthe educationandcomplianceeffortstoensureallnon-compliantaccountsbecomecompliant.Ongoing discussionsbetweenHdL,staff,andtheotherconsultantslistedinthisstaffreportaretakingplaceto ensurecommunityawarenessoftheregistrationrequirementstofurtherdrivecompliance.Withouta robusteducationandcomplianceprogram,itisexpectedthatthecomplianceratefortheregistration requirementwilleitherdecreaseorremainstagnant.Tocontinuetodriveengagementanduseofthe registrationportal,notonlyforannualregistration,butalsoforchangesinownershiportenancies, HdL has proposed a total budget not to exceed $110,000.
Public Outreach and Communications - Tripepi Smith and Associates (TSA) StaffcontinuestoworkwithTSA,theCity’scommunicationsconsultant,toengageextensivelywith thecommunityandcreatewritteneducationalmaterialstopublicizethepassageandrequirementsof theOrdinance.Tohighlight,overthispastfiscalyear,amailerdedicatedtotenantprotectionsforCity tenantswasreleasedinalignmentwiththeanticipatedendtoLACounty’sCOVID-19Tenant ProtectionsResolution,thewebsitewasupdatedwithevenmorepertinentinformationtofurther increasethepublic’sunderstandingoftheOrdinancerequirementsandeasenavigationandaccess toinformation,andadecisiontreewascreatedtohelprentersunderstandtheiroptionsrelatedto rentincreases.StaffandTSAhavedevelopedaneducation,outreach,andcommunityengagement planinresponsetofrequentlyaskedquestionsandknowledgegapsthathavecomeupfromthe public.SinceJuly2021,TSAhasprovidedinformationtothepublicviatargetedsocialmediaads, mailers,decisionstreesforclarityaroundallowablerentincreasesandjustcauseevictions,regular websitemaintenanceandupdates,andpressreleasesinalignmentwithlargertenantprotection matters.TSAwillcontinuetoprovidepublicityaroundtheOrdinanceintheupcomingfiscalyear promotinginformationthroughamailer,threepressreleases,ananimatedvideo,socialmediablasts, andwebsiteupdates.TSAhasproposedatotalbudgetnottoexceed$32,610foritsworkonthe proposedcommunityengagementplan.Thisbudgetincludes$14,320inTSAlaborcosts,and $18,290 in pass-through costs (such as video, postage, and printing costs).
Bet Tzedek - Legal Services
SincethepassageoftheIRCO,andwiththeadoptionofthepermanentOrdinances,HHSregularly receivesinquiriesrelatedtolandlord/tenantrightsandresponsibilitiesunderCalifornialawand FederalFairHousinglaw.SincetheserequireinterpretationofStateandotherlaws,staffcontinues City of Culver CityPage 3 of 5Printed on 6/22/2023
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File #:23-1087,Version:1 Item #:C-10.
toreferinquiriestoBetTzedekthatareoutsidethescopeofservicesprovidedbytheCity,suchas legaladviceonviolationsofstateandfederalhousinglaw.BetTzedekisaprivate,non-profit organizationofferingavarietyoflegalservices,inLosAngelesCounty,andspecificallyprovides dedicatedlegalservicestoCulverCityresidents,includinganduptofulllegalrepresentation.The ’scontractwithBetTzedekdesignatesafull-timeattorneywhoisknowledgeableaboutCalifornia landlord/tenantlaw,FederalFairHousinglaw,andCulverCityRentControlandTenantProtections Ordinances,toassistCulverCityresidents.BetTzedek’scontractalsoallowsCulverCityresidentsto contact them through a dedicated hotline and email address to obtain legal support.
Overthepastfiscalyear,BetTzedekhastaken109cases,17ofwhichresultedin,orarepending, fullscoperepresentationinstatecourt,andtheremainderprovidingeitheradviceandcounselor limitedscoperepresentationonhousingmatters.BetTzedekcontinuestoholdHousingClinics weekly,andhaveheld48thisfiscalyear,whereresidentscancompleteanintakeandreceivelegal counselingandadvicefortheirownuniquehousingissues.Inaddition,BetTzedekhascontinued conductingeducationaloutreachtoCulverCityresidentstoensureclarityoftheirrightsand responsibilitiesundertheOrdinances,includingKnowYourRightsworkshops.Theamountrequired toextendthecontractwithBetTzedekforthenextfiscalyeartomaintaindedicatedlegalservicefor Culver City residents is not-to-exceed $148,736.
FISCAL ANALYSIS
AfeestudywascompletedattheinceptionoftheProgramtoensurethatallProgramcostswouldbe supportedwithrevenuegeneratedthroughthecollectionoftherentregistrationfee,whichis currentlysetat$167percoveredunit.Staffisusing5,287,thecurrentnumberofcompliantunits,to estimatetherevenueforFiscalYear2023/2024at$882,929.Asmoreunitscomeintocompliance, thisnumberwillbeadjusted.TheAdoptedBudgetforFiscalYear2023/2024includessufficient fundinginAccountNos.10135400.619800(RentStabilization-OtherContractualServices)and 10135400.611600(RentStabilization-LegalServicesMiscellaneous)tosupporttheamendments included in this report.
ATTACHMENTS
None.
MOTION
That the City Council:
1.Receive a progress report on the status of the implementation of the Rent Control and Tenant Protection Ordinances;
2.Approve an amendment to the existing professional services agreement with BAE Urban Economics toinclude the development of guidelines, procedures, and related materials to implement the processes relatedto No Fault Evictions with consideration of State SB 8 requirements, finalize Staff Handbook, and provide ongoing petition, application, and form support inan amount not-to-exceed $63,195; and, City of Culver CityPage 4 of 5Printed on 6/22/2023
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3.Approve an amendment to the existing professional services agreement with Tripepi Smith and Associates (TSA) to continuea public communications program for the Rent Control and Tenant Protections Ordinancesin an amount not-to-exceed $32,610; and
4.Approve an amendment to the existing professional services agreement with HdL to continuemaintenance of the online residential rental registration system and education and compliance services in anamount not-to-exceed $110,000; and,
5.Approve an amendment to the existing professional services agreement with Bet Tzedek to continue providing legal services to Culver City residents in an amount not-to- exceed $148,736; and,
6.Authorize the City Attorney to review/prepare necessary documents; and,
7.Authorize the City Manager to execute such documents on behalf of the City City of Culver CityPage 5 of 5Printed on 6/22/2023
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Revenue&CostSpecialists,LLC
1519 E Chapman Ave, Ste C
Fullerton, CA 92831
Tel (714) 992-9020
www.revenuecost.com
2023
PROFESSIONAL SERVICES AGREEMENT
(Engagement: Simultaneous Interpretation Services)
(Parties: Samantha Lubrani and City of Bell Gardens)
THIS PROFESSIONAL SERVICES AGREEMENT (hereinafter, e) is made and entered into this ___________ day of __________________ 2023 (hereinafter, the by and between the CITY OF BELL GARDENS, a municipal corporation (hereinafter, CITY and SAMANTHA LUBRANI CONSULTANT
purposes of this Agreement, CITY and CONSULTANT may be referred to collectively by CITY or
CONSULTANT interchangeably, as appropriate.
RECITALS
WHEREAS, CITY requires professional simultaneous interpretation services; and
WHEREAS, CITY staff has determined that CONSULTANT possesses the experience, skills and training necessary to competently provide such services to CITY; and
WHEREAS, the execution of this Agreement was approved by the Bell Gardens City Council at its Regular Meeting.
NOW, THEREFORE, for and in consideration of the mutual covenants and conditions herein contained, CITY and CONSULTANT agree as follows:
I.
ENGAGEMENT TERMS
1.1 TERM: This Agreement shall have a term of three (3) years commencing from the Effective Date through November 13, 2026 Nothing in
terminate this Agreement at any time for convenience or for cause as provided under Article V (Termination), below. The Term of the Agreement may be extended by the CITY subject to its same terms and conditions for a maximum of two (2) one-year extensions, provided the CITY issues written notice of its intent to extend the Term of the Agreement prior to the expiration of the initial Term.
1.2 SCOPE OF WORK:
A. Subject to the terms and conditions of this Agreement, CONSULTANT agrees to provide the services and tasks described in that certain Request Request for Proposals for Simultaneous
dated October 9, 2023,
Proposal Form -
PROPOSAL
1 CONSULTANT PROPOSAL are attached and incorporated hereto as and
collective reference to the CITY RFP and the CONSULTANT PROPOSAL. services and tasks referenced in the Scope of Work. In the event of any conflict or inconsistency between the provisions of the document entitled CITY RFP and the provisions of the document entitled CONSULTANT PROPOSAL, the requirements of the document entitled CITY RFP shall govern and control but only to the extent of the conflict or inconsistency and no further. In the event of any conflict or inconsistency between the provisions of the Scope of Work and the provisions of this Agreement to which the Scope of Work is attached, the provisions of this Agreement shall govern and control.
1.3 PROSECUTION OF WORK:
A. CONSULTANT shall perform Work continuously and with due diligence so as to complete the Work within the Term of this Agreement;
B. CONSULTANT shall cooperate with CITY and in no manner interfere with the work of CITY, its employees or other consultants, contractors or agents;
C. CONSULTANT shall not claim or be entitled to receive any compensation or damage because of the failure of CONSULTANT, or its subconsultants, to have related services or tasks completed in a timely manner;
D. CONSULTANT shall at all times enforce strict discipline and good order
E. CONSULTANT, at its sole expense, shall pay all sales, consumer, use or other similar taxes required by law.
1.4 COMPENSATION: CONSULTANT shall perform the Work in accordance with the CONSULTANT PROPOSAL. The foregoing notwithstanding, CONSULTANTs total compensation for the performance of all Work contemplated under this Agreement, will not exceed an annual budget sum of Twenty-Eight Thousand Dollars ($28,000) for the total budgeted aggregate sum of ONE HUNDRED FORTY THOUSAND DOLLARS ($140,000) (hereina-to-Exceed
during the prosecution of this Agreement, unless such added expenditure is first approved by the City Council.
projected to exceed the Not-to-Exceed Sum prior to the expiration of this Agreement
approval of any anticipated expenditures in excess of the Not-to-Exceed Sum or any other CITY approved amendment to the compensation terms of this Agreement.
1.5 PAYMENT OF COMPENSATION: Following the conclusion of the Work requested in Section 1.2, CONSULTANT shall submit to CITY an itemized invoice indicating the services performed and tasks completed during the recently concluded 2 calendar month,including services and tasks performed and the reimbursable out- of-pocket expenses incurred. If the amount of CONSULTANTs compensation is a function of hours worked by CONSULTANTs personnel, the invoice should indicate the number of hours worked, the persons responsible for performing the Work, the rate of compensation at which such services and tasks were performed, the subtotal for each task and service performed and a grand total for all services performed. Within thirty (30) calendar days of receipt of each invoice, CITY will notify CONSULTANT in writing of any disputed amounts included in the invoice.
Within forty-five (45) calendar days of receipt of each invoice, CITY will pay all undisputed amounts included on the invoice. CITY will not withhold applicable taxes or other authorized deductions from payments made to CONSULTANT.
1.6 ACCOUNTING RECORDS: CONSULTANT will maintain complete and accurate records with respect to all matters covered under this Agreement for a period of three (3) years after the expiration or termination of this Agreement. CITY will have the right to access and examine such records, without charge, during normal business hours. CITY will further have the right to audit such records, to make transcripts therefrom and to inspect all program data, documents, proceedings, and activities.
1.7 ABANDONMENT BY CONSULTANT: In the event CONSULTANT ceases to perform the Work agreed to under this Agreement or otherwise abandons the undertaking contemplated herein prior to the expiration of this Agreement or prior to completion of any or all tasks set forth in the Scope of Work, CONSULTANT will deliver to CITY immediately and without delay, all materials, records and other work product prepared or obtained by CONSULTANT in the performance of this Agreement. Furthermore, CONSULTANT will only be compensated for the reasonable value of the services, tasks and other Work performed up to the time of cessation or abandonment, less a deduction for any damages, costs or additional expenses which CITY may incur as a result of CONSULTANTs cessation or abandonment.
II.
PERFORMANCE OF AGREEMENT
2.1 CITYS REPRESENTATIVE: The CITY hereby designates Daisy Gomez, City Clerk City , to act as its representative for the
performance of this Agreement. The City Representative or their designee will act on behalf of the CITY for all purposes under this Agreement. CONSULTANT will not accept directions or orders from any person other than the City Representative or their designee.
2.2 CONSULTANT REPRESENTATIVE: CONSULTANT hereby designates Samantha Lubrani, to act as its representative for the performance of this Agreement Consultant Representative Consultant Representative will have full authority to represent and act on behalf of the CONSULTANT for all purposes under this Agreement. Consultant Representative or their designee will supervise and direct the performance of the Work, using their best skill and attention, and will be responsible for all means, methods, techniques, sequences 3 and procedures and for the satisfactory coordination of all portions of the Work under this Agreement. Notice to the Consultant Representative will constitute notice to CONSULTANT.
2.3 COORDINATION OF SERVICE; CONFORMANCE WITH REQUIREMENTS:
CONSULTANT agrees to work closely with CITY staff in the performance of the Work and this Agreement and will be available to CITY staff and the City Representative at all reasonable times. All work prepared by CONSULTANT will be subject to inspection and approval by City Representative or their designees.
2.4 STANDARD OF CARE; PERFORMANCE OF EMPLOYEES: CONSULTANT represents, acknowledges and agrees to the following:
A. CONSULTANT will perform all Work skillfully, competently and to the highest standards of CONSULTANTs profession;
B. CONSULTANT shall at all times employ such force, plant, materials, and tools as will be sufficient in the opinion of the CITY to perform the Services within the time limits established, and as provided herein. It is understood and agreed that said tools, equipment, apparatus, facilities, labor, and material shall be furnished and said Services performed and completed as
authorized representative;
C. CONSULTANT will perform all Work in a manner reasonably satisfactory to the CITY;
D. CONSULTANT will comply with all applicable federal, state and local laws and regulations, including the conflict of interest provisions of Government Code Section 1090 and the Political Reform Act (Government Code Section 81000 et seq.). CONSULTANT shall be liable for all violations of such laws and regulations in connection with Services. If CONSULTANT performs any work knowing it to be contrary to such laws, rules and regulations, CONSULTANT shall be solely responsible for all costs arising therefrom;
E. CONSULTANT understands the nature and scope of the Work to be performed under this Agreement as well as any and all schedules of performance;
F. All of CONSULTANTs employees and agents possess sufficient skill, knowledge, training and experience to perform those services and tasks assigned to them by CONSULTANT; and
G. All of CONSULTANTs employees and agents (including, but not limited to, subcontractors and subconsultants) possess all licenses, permits, certificates, qualifications and approvals of whatever nature that are legally required to perform the tasks and services contemplated under this Agreement and all such licenses, permits, certificates, qualifications and approvals will be maintained throughout the term of this Agreement and 4 made available to CITYfor copying and inspection.
The Parties acknowledge and agree that CONSULTANT will perform, at CONSULTANTs own cost and expense and without any reimbursement from CITY, any services necessary to correct any errors or omissions caused by CONSULTANTs failure to comply with the standard of care set forth under this Section or by any like failure on the part of CONSULTANTs employees, agents, contractors, subcontractors and subconsultants. Such effort by CONSULTANT to correct any errors or omissions will be commenced immediately upon their discovery by either Party and will be completed within seven (7) calendar days from the date of discovery or such other extended period of time authorized by the City Representative in writing and in their sole and absolute discretion. The Parties acknowledge and agree that CITYs acceptance of any work performed by CONSULTANT or on CONSULTANTs behalf will not constitute a release of any deficiency or delay in performance. The Parties further acknowledge, understand and agree that CITY has relied upon the foregoing representations of CONSULTANT, including but not limited to the representation that CONSULTANT possesses the skills, training, knowledge and experience necessary to perform the Work skillfully, competently and to the highest standards of CONSULTANTs profession.
2.5 ASSIGNMENT: The skills, training, knowledge and experience of CONSULTANT are material to CITYs willingness to enter into this Agreement. Accordingly, CITY has an interest in the qualifications and capabilities of the person(s) who will perform the services and tasks to be undertaken by CONSULTANT or on behalf of CONSULTANT in the performance of this Agreement. In recognition of this interest, CONSULTANT agrees that it will not assign or transfer, either directly or indirectly or by operation of law, this Agreement or the performance of any of CONSULTANTs duties or obligations under this Agreement without the prior written consent of the CITY. In the absence of CITYs prior written consent, any attempted assignment or transfer will be ineffective, null and void and will constitute a material breach of this Agreement.
2.6 SUBSTITUTION OF KEY PERSONNEL: CONSULTANT has represented to CITY that certain key personnel will perform and coordinate the Services under this Agreement. Should one or more of such personnel become unavailable, CONSULTANT may substitute other personnel of at least equal competence upon written approval of CITY. In the event that CITY and CONSULTANT cannot agree as to the substitution of key personnel, CITY shall be entitled to terminate this Agreement for cause. As discussed below, any personnel who fail or refuse to perform the Services in a manner acceptable to the CITY, or who are determined by the CITY to be uncooperative, incompetent, a threat to the adequate or timely completion of the Project or a threat to the safety of persons or property, shall be promptly removed from the Project by the CONSULTANT at the request of the CITY.
2.7 CONTROL AND PAYMENT OF SUBORDINATES; INDEPENDENT
CONTRACTOR: The Work will be performed by CONSULTANT or under CONSULTANTs strict supervision. CONSULTANT will determine the means, 5 methods and details of performing the Worksubject to the requirements of this Agreement. CITY retains CONSULTANT on an independent contractor basis and not as an employee. CONSULTANT reserves the right to perform similar or different services for other principals during the term of this Agreement, provided such work does not unduly interfere with CONSULTANTs competent and timely performance of the Work contemplated under this Agreement and provided the performance of such services does not result in the unauthorized disclosure of CITYs confidential or proprietary information. Any additional personnel performing the Work under this Agreement on behalf of CONSULTANT are not employees of CITY and will at all times be under CONSULTANTs exclusive direction and control. CONSULTANT will pay all wages, salaries and other amounts due to such personnel and will assume responsibility for all benefits, payroll taxes, Social Security and Medicare payments and the like. CONSULTANT will be responsible for all reports and obligations respecting such additional personnel, including, but not limited to: Social Security taxes, income tax withholding, unemployment insurance, disability insurance, workers compensation insurance and the like.
2.8 REMOVAL OF EMPLOYEES OR AGENTS: If any of CONSULTANTs officers, employees, agents, contractors, subcontractors or subconsultants is determined by the City Representative to be uncooperative, incompetent, a threat to the adequate or timely performance of the tasks assigned to CONSULTANT, a threat to persons or property, or if any of CONSULTANTs officers, employees, agents, contractors, subcontractors or subconsultants fail or refuse to perform the Work in a manner acceptable to the CITY, such officer, employee, agent, contractor, subcontractor or subconsultant will be promptly removed by CONSULTANT and will not be reassigned to perform any of the Work.
2.9 COMPLIANCE WITH LAWS: CONSULTANT will keep itself informed of and in compliance with all applicable federal, state or local laws to the extent such laws control or otherwise govern the performance of the Work. CONSULTANTs compliance with applicable laws will include, without limitation, compliance with all applicable Cal/OSHA requirements and applicable regulations of the Federal Department of Housing and Urbanization.
2.10 NON-DISCRIMINATION: CONSULTANT represents that it is an equal opportunity employer and it shall not discriminate against any subconsultant, employee or applicant for employment because of race, religion, color, national origin, handicap, ancestry, sex or age. Such non-discrimination shall include, but not be limited to, all activities related to initial employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination.
2.11 INDEPENDENT CONTRACTOR STATUS: The Parties acknowledge, understand and agree that CONSULTANT and all persons retained or employed by CONSULTANT are, and will at all times remain, wholly independent contractors and are not officials, officers, employees, departments or subdivisions of CITY.
CONSULTANT will be solely responsible for the negligent acts and/or omissions of its employees, agents, contractors, subcontractors and subconsultants.
CONSULTANT and all persons retained or employed by CONSULTANT will have no authority, express or implied, to bind CITY in any manner, nor to incur any 6 obligation, debt or liability of any kind on behalf of, or against,CITY, whether by contract or otherwise, unless such authority is expressly conferred to CONSULTANT under this Agreement or is otherwise expressly conferred by CITY in writing.
III.
INSURANCE
3.1 DUTY TO PROCURE AND MAINTAIN INSURANCE: Prior to the beginning of and throughout the duration of the Work, CONSULTANT will procure and maintain policies of insurance that meet the requirements and specifications set forth under this Article. CONSULTANT will procure and maintain the following insurance coverage, at its own expense:
A. Commercial General Liability Insurance: CONSULTANT will procure and broad as Insurance Services Office Commercial General Liability coverage (occurrence Form CG 0001) or its equivalent. Such CGL Coverage will have minimum limits of no less than One Million Dollars ($1,000,000.00) per occurrence and Two Million Dollars ($2,000,000.00) in the general aggregate for bodily injury, personal injury, property damage, operations, products and completed operations, and contractual liability.
B. Automobile Liability Insurance: CONSULTANT will procure and maintain Automobile Liability Insurance as broad as Insurance Services Office Form Number CA 0001 covering Automobile Liability, Code 1 (any auto). Such Automobile Liability Insurance shall have minimum limits of no less than Five Hundred Thousand Dollars ($500,000.00) per accident for bodily injury and property damage.
C. Workers Compensation Insurance/ Employers Liability Insurance: A policy of workers compensation insurance in such amount as will fully comply with the laws of the State of California and which will indemnify, insure and provide legal defense for both CONSULTANT and CITY against any loss, claim or damage arising from any injuries or occupational diseases occurring to any worker employed by or any persons retained by CONSULTANT in the course of carrying out the Work contemplated in this Agreement.
D. Errors & Omissions Insurance: For the full term of this Agreement and for a period of three (3) years thereafter, CONSULTANT will procure and maintain Errors and Omissions Liability Insurance appropriate to CONSULTANTs profession. Such coverage will have minimum limits of no less than One Million Dollars ($1,000,000.00) per claim.
3.2 ADDITIONAL INSURED REQUIREMENTS: The CGL Coverage and the Automobile Liability Insurance will contain an endorsement naming the CITY and CITYs elected and appointed officials, officers, employees, agents and volunteers as additional insureds.
7 3.3 REQUIRED CARRIER RATING: All varieties of insurance required under this Agreement will be procured from insurers admitted in the State of California and authorized to issue policies directly to California insureds. Except as otherwise provided elsewhere under this Article, all required insurance will be procured from insurers who, according to the latest edition of the Bests Insurance Guide, have an A.M. Bests rating of no less than A:VII. CITY may also accept policies procured by insurance carriers with a Standard & Poors rating of no less than BBB according to the latest published edition the Standard & Poors rating guide. As to Workers Compensation Insurance/ Employers Liability Insurance, the CITY Representative is authorized to authorize lower ratings than those set forth in this Section.
3.4 PRIMACY OF CONSULTANTS INSURANCE: All policies of insurance provided by CONSULTANT will be primary to any coverage available to CITY or CITYs elected or appointed officials, officers, employees, agents or volunteers. Any insurance or self-insurance maintained by CITY or CITYs elected or appointed officials, officers, employees, agents or volunteers will be in excess of CONSULTANTs insurance and will not contribute with it.
3.5 WAIVER OF SUBROGATION: All insurance coverage provided pursuant to this Agreement will not prohibit CONSULTANT or CONSULTANTs officers, employees, agents, subcontractors or subconsultants from waiving the right of subrogation prior to a loss. CONSULTANT hereby waives all rights of subrogation against CITY, its officials, officers, employees, agents and volunteers.
3.6 VERIFICATION OF COVERAGE: CONSULTANT acknowledges, understands and agrees, that CITYs ability to verify the procurement and maintenance of the insurance required under this Article is critical to safeguarding CITYs financial well-being and, indirectly, the collective well-being of the residents of the CITY.
Accordingly, CONSULTANT warrants, represents and agrees that it will furnish CITY with original certificates of insurance and endorsements evidencing the coverage required under this Article on forms satisfactory to CITY in its sole and absolute discretion. The certificates of insurance and endorsements for each insurance policy will be signed by a person authorized by that insurer to bind coverage on its behalf, and will be on forms provided by the CITY if requested. All certificates of insurance and endorsements will be received and approved by CITY as a condition precedent to CONSULTANTs commencement of any Work. Upon CITYs written request, CONSULTANT will also provide CITY with certified copies of all required insurance policies and endorsements.
3.7 FAILURE TO MAINTAIN COVERAGE: In the event any policy of insurance required under this Agreement does not comply with these specifications or is canceled and not replaced immediately so as to avoid a lapse in the required coverage, CITY has the right but not the duty to obtain the insurance it deems necessary and any premium paid by CITY will be promptly reimbursed by CONSULTANT or CITY will withhold amounts sufficient to pay premium from CONSULTANT payments. In the alternative, CITY may cancel this Agreement effective upon notice.
8 3.8 SPECIAL RISKS OR CIRCUMSTANCES. CITY reserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances.
IV.
INDEMNIFICATION
4.1 The Parties agree that CITY an
ity
the fullest extent permitted by law, be protected from any and all loss, injury, cost arising out of or in any way related to the performance of this Agreement. Accordingly, the provisions of this indemnity provision are intended by the Parties to be interpreted and construed to provide the City Indemnitees with the fullest protection possible under the law. CONSULTANT acknowledges that CITY wou
commitment to indemnify, defend and protect CITY as set forth herein. to Civil Code Section 2782.8, the above indemnity shall be limited, to the extent required by Civil Code Section 2782.8, to Claims that arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of the CONSULTANT. stricted to insurance
proceeds, if any, received by the CITY, its officials, officers, employees, agents or volunteers.
4.2 To the fullest extent permitted by law, CONSULTANT shall indemnify, hold harmless and defend the City Indemnitees from and against all liability, loss, expert fees and all other costs, and fees of litigation) of every nature arising out of failure
to comply with any of its obligations contained in this Agreement, except such loss or damage which is caused by the sole negligence or willful misconduct of the CITY.
4.3 CITY shall have the right to offset against the amount of any compensation due to CONSULTANT under this Agreement, any amount due to CITY from ity
Indemnitees under this
pay taxes on amounts received pursuant to this Agreement, or (ii) comply with
4.4 The obligations of CONSULTANT under this Article will not be limited by the pro
expressly waives its statutory immunity under such statutes or laws as to CITY and volunteers.
9 4.5CONSULTANT agreesto obtain executed indemnity agreements with provisions identical to those set forth herein this Article from each and every subcontractor or any other person or entity involved by, for, with or on behalf of CONSULTANT in the performance of this Agreement. In the event CONSULTANT fails to obtain such indemnity obligations from others as required herein, CONSULTANT agrees elected and appointed officials, officers, employees, agents, and volunteers from and against any and all claims and losses, costs or expenses for any damage due to death or injury to any person and injury to any property resulting from any alleged intentional, reckless, negligent, or otherwise wrongful acts, errors or involved by, for, with or on behalf of CONSULTANT in the performance of this incurred by counsel of
4.6 CITY does not, and shall not waive any rights that it may possess against CONSULTANT because of the acceptance by CITY, or the deposit with CITY, of any insurance policy or certificate required pursuant to this Agreement. This hold harmless and indemnification provision shall apply regardless of whether or not any insurance policies are determined to be applicable to the claim, demand, damage, liability, loss, cost, or expense.
4.7 This Article and all provisions contained herein (including but not limited to the duty to indemnify, defend, and hold free and harmless) shall survive the termination or normal expiration of this Agreement and is in addition to any other rights or remedies which the CITY may have at law or in equity.
V.
TERMINATION
5.1 TERMINATION WITHOUT CAUSE: CITY may immediately terminate this Agreement at any time for convenience and without cause by giving prior written notice of CITYs intent to terminate this Agreement which notice shall specify the effective date of such termination. Upon such termination for convenience, CONSULTANT will be compensated only for those services and tasks which have been performed by CONSULTANT up to the effective date of the termination.
CONSULTANT may not terminate this Agreement except for cause as provided under Section 5.2, below. If this Agreement is terminated as provided herein, CITY may require CONSULTANT to provide all finished or unfinished Documents and Data, as defined in Section 6.1, below, and other information of any kind prepared by CONSULTANT in connection with the performance of the Work.
CONSULTANT will be required to provide such Documents and Data within fifteen (15) calendar days of CITYs written request. No actual or asserted breach of this Agreement on the part of CITY pursuant to Section 5.2, below, will operate to prohibit or otherwise restrict CITYs ability to terminate this Agreement for convenience as provided under this Section.
5.2 EVENTS OF DEFAULT; BREACH OF AGREEMENT:
10 A.In the event either Party fails to perform any duty, obligation, service or task set forth under this Agreement (or fails to timely perform or properly perform any such duty, obligation, service or task set forth under this Agreement), will occur. For all Events
of Default, the Party alleging an Event of Default will give written notice to will
specify: (i) the nature of the Event of Default; (ii) the action required to cure the Event of Default; (iii) a date by which the Event of Default will be cured, which will not be less than the applicable cure period set forth under Sections 5.2(B) and 5.2(C), below, or if a cure is not reasonably possible within the applicable cure period, to begin such cure and diligently prosecute such cure to completion. The Event of Default will constitute a breach of this Agreement if the defaulting Party fails to cure the Event of Default within the applicable cure period or any extended cure period allowed under this Agreement.
B. CONSULTANT will cure the Event of Default within the following time periods:
i. Within ten (10) business days of CITYs issuance of a Default Notice for any failure of CONSULTANT to timely provide CITY or CITYs employees or agents with any information and/or written reports, documentation or work product which CONSULTANT is obligated to provide to CITY or CITYs employees or agents under this Agreement.
Prior to the expiration of the 10-day cure period, CONSULTANT may submit a written request for additional time to cure the Event of Default upon a showing that CONSULTANT has commenced efforts to cure the Event of Default and that the Event of Default cannot be reasonably cured within the 10-day cure period. The foregoing notwithstanding, CITY will be under no obligation to grant additional time for the cure of an Event of Default under this Section 5.2(B)(i) that exceeds seven (7) calendar days from the end of the initial 10-day cure period; or
ii. Within fourteen (14) calendar days of CITYs issuance of a Default Notice for any other Event of Default under this Agreement. Prior to the expiration of the 14-day cure period, CONSULTANT may submit a written request for additional time to cure the Event of Default upon a showing that CONSULTANT has commenced efforts to cure the Event of Default and that the Event of Default cannot be reasonably cured within the 14-day cure period. The foregoing notwithstanding, CITY will be under no obligation to grant additional time for the cure of an Event of Default under this Section 5.2(B)(ii) that exceeds thirty (30) calendar days from the end of the initial 14-day cure period.
In addition to any other failure on the part of CONSULTANT to perform any duty, obligation, service or task set forth under this Agreement (or the failure to timely perform or properly perform any such duty, obligation, service or task), an Event of Default on the part of CONSULTANT will include, but will not be limited to the following: (i) CONSULTANTs refusal or failure to 11 perform any of the services or tasks called for under the Scope of Work; (ii) CONSULTANTs failure to fulfill or perform its obligations under this Agreement within the specified time or if no time is specified, within a reasonable time; (iii) CONSULTANTs and/or its employees disregard or violation of any federal, state, local law, rule, procedure or regulation; (iv) the initiation of proceedings under any bankruptcy, insolvency, receivership, reorganization, or similar legislation as relates to CONSULTANT, whether voluntary of involuntary; (v) CONSULTANTs refusal or failure to perform or observe any covenant, condition, obligation or provision of this Agreement; and/or (vii) CITYs discovery that a statement representation or warranty by CONSULTANT relating to this Agreement is false, misleading or erroneous in any material respect.
C. CITY will cure any Event of Default asserted by CONSULTANT within forty- five (45) calendar days of CONSULTANTs issuance of a Default Notice, unless the Event of Default cannot reasonably be cured within the 45-day cure period. Prior to the expiration of the 45-day cure period, CITY may submit a written request for additional time to cure the Event of Default upon a showing that CITY has commenced its efforts to cure the Event of Default and that the Event of Default cannot be reasonably cured within the 45-day cure period. The foregoing notwithstanding, an Event of Default dealing with CITYs failure to timely pay any undisputed sums to CONSULTANT as provided under Section 1.5, above, will be cured by CITY within five (5) calendar days from the date of CONSULTANTs Default Notice to CITY.
D. CITY, in its sole and absolute discretion, may also immediately suspend CONSULTANTs performance under this Agreement pending
CONSULTANTs cure of any Event of Default by giving CONSULTANT written notice of CITYs intent to suspend CONSULTANTs performance CITY may issue the Suspension
Notice at any time upon the occurrence of an Event of Default. Upon such suspension, CONSULTANT will be compensated only for those services and tasks which have been rendered by CONSULTANT to the reasonable satisfaction of CITY up to the effective date of the suspension. No actual or asserted breach of this Agreement on the part of CITY will operate to prohibit or otherwise restrict CITYs ability to suspend this Agreement as provided herein.
E. No waiver of any Event of Default or breach under this Agreement will constitute a waiver of any other or subsequent Event of Default or breach.
No waiver, benefit, privilege, or service voluntarily given or performed by a Party will give the other Party any contractual rights by custom, estoppel, or otherwise.
F. The duties and obligations imposed under this Agreement and the rights and remedies available hereunder will be in addition to and not a limitation of any duties, obligations, rights and remedies otherwise imposed or available by law. In addition to any other remedies available to CITY at law or under this Agreement in the event of any breach of this Agreement, CITY, 12 in its sole and absolute discretion, may also pursue any one or more of the following remedies:
i. Upon written notice to CONSULTANT, the CITY may immediately terminate this Agreement in whole or in part;
ii. Upon written notice to CONSULTANT, the CITY may extend the time of performance;
iii. The CITY may proceed by appropriate court action to enforce the terms of the Agreement to recover damages for CONSULTANTs breach of the Agreement or to terminate the Agreement; or
iv. The CITY may exercise any other available and lawful right or remedy.
CONSULTANT will be liable for all legal fees plus other costs and expenses that CITY incurs upon a breach of this Agreement or in the CITYs exercise of its remedies under this Agreement.
G. In the event CITY is in breach of this Agreement, CONSULTANTs sole remedy will be the suspension or termination of this Agreement and/or the recovery of any unpaid sums lawfully owed to CONSULTANT under this Agreement for completed services and tasks.
5.3 SCOPE OF WAIVER: No waiver of any default or breach under this Agreement will constitute a waiver of any other default or breach, whether of the same or other covenant, warranty, agreement, term, condition, duty or requirement contained in this Agreement. No waiver, benefit, privilege, or service voluntarily given or performed by a Party will give the other Party any contractual rights by custom, estoppel, or otherwise.
5.4 SURVIVING ARTICLES, SECTIONS AND PROVISIONS: The termination of this Agreement pursuant to any provision of this Article or by normal expiration of its term or any extension thereto will not operate to terminate any Article, Section or provision contained herein which provides that it will survive the termination or normal expiration of this Agreement.
VI.
MISCELLANEOUS PROVISIONS
6.1 DOCUMENTS & DATA; LICENSING OF INTELLECTUAL PROPERTY: All Documents and Data will be and remain the property of CITY without restriction or limitation upon their use or dissemination by CITY. For purposes of this all reports,
analyses, correspondence, plans, designs, notes, summaries, strategies, charts, schedules, spreadsheets, calculations, lists, data compilations, documents or other materials developed and/or assembled by or on behalf of CONSULTANT in the performance of this Agreement and fixed in any tangible medium of expression, including but not limited to Documents and Data stored digitally, magnetically 13 and/or electronically. This Agreement creates, at no cost to CITY, a perpetual license for CITY to copy, use, reuse, disseminate and/or retain any and all copyrights, designs, and other intellectual property embodied in all Documents and Data. CONSULTANT will require all subcontractors and subconsultants working on behalf of CONSULTANT in the performance of this Agreement to agree in writing that CITY will be granted the same right to copy, use, reuse, disseminate and retain Documents and Data prepared or assembled by any subcontractor or subconsultant as applies to Documents and Data prepared by CONSULTANT in the performance of this Agreement.
6.2 CONFIDENTIALITY: All data, documents, discussion, or other information developed or received by CONSULTANT or provided for performance of this Agreement are deemed confidential and will not be disclosed by CONSULTANT without prior written consent by CITY. CITY will grant such consent of disclosure as legally required. Upon request, all CITY data will be returned to CITY upon the termination or expiration of this Agreement. CONSULTANT will not use CITYs name or insignia, photographs, or any publicity pertaining to the Work in any magazine, trade paper, newspaper, television or radio production or other similar medium without the prior written consent of CITY.
6.3 FALSE CLAIMS ACT: CONSULTANT warrants and represents that neither CONSULTANT nor any person who is an officer of, in a managing position with, or has an ownership interest in CONSULTANT has been determined by a court or tribunal of competent jurisdiction to have violated the False Claims Act, 31 U.S.C., Section 3789 et seq. and the California False Claims Act, Government Code Section 12650 et seq.
6.4 NOTICES: All notices permitted or required under this Agreement will be given to the respective Parties at the following addresses, or at such other address as the respective Parties may provide in writing for this purpose:
CONSULTANT: CITY:
Samantha Lubrani City of Bell Gardens
23209 Sesame Street 7100 S. Garfield Avenue
Torrance, CA 90502 Bell Gardens, CA 90201
Phone: 310-386-9991 Attn: Daisy Gomez, City Clerk
Phone: 562-806-7700
Such notices will be deemed effective when personally delivered or successfully transmitted by facsimile as evidenced by a fax confirmation slip or when mailed, forty-eight (48) hours after deposit with the United States Postal Service, first class postage prepaid and addressed to the Party at its applicable address.
6.5 COOPERATION; FURTHER ACTS: The Parties will fully cooperate with one another, and will take any additional acts or sign any additional documents as are reasonably necessary, appropriate or convenient to achieve the purposes of this Agreement.
6.6 SUBCONTRACTING: CONSULTANT will not subcontract any portion of the Work 14 required by this Agreement, except as expressly stated herein, without the prior written approval of CITY. Subcontracts (including without limitation subcontracts with subconsultants), if any, will contain a provision making them subject to all provisions stipulated in this Agreement, including provisions relating to insurance requirements and indemnification.
6.7 CITYS RIGHT TO EMPLOY OTHER CONSULTANTS: CITY reserves the right to employ other contractors in connection with the various projects worked upon by CONSULTANT.
6.8 PROHIBITED INTERESTS: CONSULTANT warrants, represents and maintains that it has not employed nor retained any company or person, other than a bona fide employee working solely for CONSULTANT, to solicit or secure this Agreement. Further, CONSULTANT warrants and represents that it has not paid nor has it agreed to pay any company or person, other than a bona fide employee working solely for CONSULTANT, any fee, commission, percentage, brokerage fee, gift or other consideration contingent upon or resulting from the award or making of this Agreement. For breach or violation of this warranty, CITY will have the right to rescind this Agreement without liability. For the term of this Agreement, no member, officer or employee of CITY, during the term of his or her service with CITY, will have any direct interest in this Agreement, or obtain any present or anticipated material benefit arising therefrom.
6.9 TIME IS OF THE ESSENCE: Time is of the essence for each and every provision of this Agreement.
6.10 GOVERNING LAW AND VENUE: This Agreement will be interpreted and governed according to the laws of the State of California. In the event of litigation between the Parties, venue, without exception, will be in the Los Angeles County Superior Court of the State of California. If, and only if, applicable law requires that all or part of any such litigation be tried exclusively in federal court, venue, without exception, will in the Central District of California located in the City of Los Angeles, California.
6.11 : If either Party commences an action against the other Party, legal, administrative or otherwise, arising out of or in connection with this Agreement, the prevailing Party in such litigation will be entitled to have and recover from the losing Party reasonable and all other costs of such action.
6.12 SUCCESSORS AND ASSIGNS: This Agreement will be binding on the successors and assigns of the Parties.
6.13 NO THIRD-PARTY BENEFIT: There are no intended third-party beneficiaries of any right or obligation assumed by the Parties. All rights and benefits under this Agreement inure exclusively to the Parties.
6.14 CONSTRUCTION OF AGREEMENT: This Agreement will not be construed in favor of, or against, either Party but will be construed as if the Parties prepared this 15 Agreementtogether through a process of negotiation and with the advice of their respective attorneys.
6.15 SEVERABILITY: If any portion of this Agreement is declared invalid, illegal, or otherwise unenforceable by a court of competent jurisdiction, the remaining provisions will continue in full force and effect.
6.16 AMENDMENT; MODIFICATION: No amendment, modification or supplement of this Agreement will be valid or binding unless executed in writing and signed by both Parties, subject to CITY approval. The requirement for written amendments, modifications or supplements cannot be waived and any attempted waiver will be void and invalid.
6.17 CAPTIONS: The captions of the various articles, sections and paragraphs are for convenience and ease of reference only, and do not define, limit, augment, or describe the scope, content, or intent of this Agreement.
6.18 INCONSISTENCIES OR CONFLICTS: In the event of any conflict or inconsistency between the provisions of this Agreement and any of the exhibits attached hereto, the provisions of this Agreement will control.
6.19 ENTIRE AGREEMENT: This Agreement, including all attached exhibits, constitutes the entire, complete, final and exclusive expression of the Parties with respect to the matters addressed herein and supersedes all other agreements or understandings, whether oral or written, which may have been entered into between CITY and CONSULTANT prior to the execution of this Agreement. Any statements, representations, or other agreements, whether oral or written, made by either Party that is not embodied herein will not be valid or binding on the Parties. No amendment, modification or supplement to this Agreement will be valid and binding unless in writing and duly executed by the Parties pursuant to Section
6.16, above.
6.20 FORCE MAJEURE: The Term shall be extended in the event of any delays due to unforeseeable causes beyond the control of CONSULTANT and without the fault or negligence of CONSULTANT, including but not limited to severe weather, fires, earthquakes, floods, epidemics, quarantine restrictions, riots, strikes, freight embargoes, wars, litigation, and/or acts of any governmental agency, including the CITY, if the CONSULTANT shall within three (3) calendar days of the commencement of such delay notify the City Representative in writing of the causes of the delay. The City Representative shall ascertain the facts and the extent of delay, and extend the time for performing the services for the period of the enforced delay when and if in the judgment of the City Representative such delay is
conclusive upon the parties to this Agreement. In no event shall CONSULTANT be entitled to recover damages against the CITY for any delay in the performance of this Agreement, however caused, CONSULTANT sole remedy being extension of the Agreement pursuant to this Section.
6.21 COUNTERPARTS: This Agreement may be executed in any number of 16 counterparts, each of which shall be deemed an original, but all of which when taken together shall constitute one and the same instrument. No handwritten or typewritten amendment, modification or supplement to any one counterpart will be valid or binding unless made to all three counterparts in conformity with Section
6.16, above. One fully executed original counterpart will be delivered to CONSULTANT and two original counterparts will be retained by CITY.
(SIGNATURES ON NEXT PAGE)
17 IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed the day and year first appearing in this Agreement, above.
CITY OF BELL GARDENS: SAMANTHA LUBRANI:
By:_______________________________ By:_______________________________
Name:____________________________ Name:____________________________
Title:____________________ Title:____________________
Date:_____________________ Date:_____________________
APPROVED AS TO FORM:
By:____________________________
Stephanie Vasquez, City Attorney
18 CITY RFP
19 CONSULTANT PROPOSAL
20 2023
SECOND AMENDMENT TO PROFESSIONAL SERVICES AGREEMENT
(Engagement: Website Design, Support and Hosting)
(Parties: City of Bell Gardens and Vision Technology Solutions, LLC dba VISION dba Granicus)
THIS SECONDAMENDMENT (hereinafter, “SecondAmendment”) to that certain agreement entitled “Vision Master Services Agreement for Bell Gardens” and dated November 14, 2017 (hereinafter, “Master Agreement”), is hereby made and entered into th
this 13 day ofNovember, 2023 (hereinafter, “Effective Date”) by and between CITY OF BELL GARDENS, a municipal corporation (hereinafter, “Client”) and VISION TECHNOLOGY SOLUTIONS, LLC DBA VISION DBA GRANICUS(hereinafter, “Contractor”). For purposes of this Second Amendment, the capitalized term “Parties” shall be a collective reference to both Client and Contractor. The capitalized term “Party” may refer to either Client or Contractor interchangeably, as appropriate.
RECITALS
This SecondAmendment is made and entered into with respect to the following facts:
WHEREAS, on November 14, 2017, the Parties executed and entered into the Professional Services Agreement for the Contractor toprovide website design, support and hosting; and
WHEREAS, the Term of the Master Agreement was extended for one (1) year by way of the First Amendment; and
WHEREAS, for purposes of this Second Amendment, the Master Agreement, as amended by way of the First Amendment, may be referred to collectively as the “Agreement”. The Agreement is attached and incorporated hereto as Exhibit “A”; and
WHEREAS, the First Amendment is set to expire on November 13, 2023; and
WHEREAS, the Parties wish to modify the Master Agreement to extend the Term of the Agreement to allow the Client sufficient time to issue a Request for Proposals; and
WHEREAS, on October 20, 2023, Contractor notified Client that the fees for an additional year of services would be in the amount of FIFTEEN THOUSAND NINE HUNDRED SEVENTY-SEVEN DOLLARS AND FIFTEEN CENTS ($15,977.15) (hereinafter “Granicus 2024 Invoice”); and
WHEREAS, the Granicus 2024 Invoice is attached and incorporated hereto as Exhibit “B”; and
WHEREAS, the Parties now wish to increasethetotal not-to-exceed amount of
NINETY-THREE THOUSAND EIGHT HUNDRED SEVENTY-SEVEN DOLLARS AND EIGHTY CENTS ($93,877.80) by FIFTEEN THOUSAND NINEHUNDRED SEVENTY- SEVEN DOLLARS AND FIFTEENCENTS ($15,977.15) for a new total not-to-exceed amountof ONE HUNDREDNINETHOUSAND EIGHT HUNDRED FIFTY-FOUR DOLLARS ANDNINETY-FIVECENTS ($109,854.95).
NOW, THEREFORE, in consideration of the mutual agreements contained herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and intending to be legally bound hereby, the Parties agree as follows:
SECTION 1. Section 26(TERM) of the Master Agreement is hereby amended to extend the term of the Master Agreement throughNovember 13, 2024.
SECTION 2. Section 5.3(SUBSCRIPTION FEES) of the Agreement is hereby amended to increase the total not-to-exceed amount of NINETY-THREE THOUSAND EIGHT HUNDRED SEVENTY-SEVEN DOLLARS AND EIGHTY CENTS ($93,877.80) by FIFTEEN THOUSAND NINE HUNDRED SEVENTY-SEVEN DOLLARS AND FIFTEEN CENTS ($15,977.15) for a new total not-to-exceed amount ofONE HUNDRED
NINE THOUSAND EIGHT HUNDRED FIFTY-FOUR DOLLARS AND NINETY-FIVE CENTS ($109,854.95)to allow for an additional one (1) year of services.
SECTION 3.Except as otherwise set forth in this Second Amendment, the Master Agreement, as amended by way of the First Amendment, shall remain binding, controlling, and in full force and effect.This Second Amendment, together with the Master Agreement and First Amendment, shall constitute the entire, complete, final, and exclusive expression of the Parties with respect to the matters addressed in both documents.
SECTION 4.The provisions of this Second Amendment shall be deemed a part of the Master Agreement and First Amendment, and except, as otherwise provided under this Second Amendment, the Master Agreement and First Amendment, and all provisions contained therein shall remain binding and enforceable. In the event of any conflict or inconsistency between the provisions of this Second Amendment and the provisions of the Master Agreement and First Amendment, the provisions of this Second Amendment shall control, but only in so far as such provisions conflict with the Master Agreement and First Amendment, and no further.
IN WITNESS WHEREOF, the Parties hereto have caused this SecondAmendment to be executed on the day and year first appearing above.
CLIENT: CONSULTANT:
CITY OF BELL GARDENS VISION TECHNOLOGY SOLUTIONS,
LLC DBA VISION DBA GRANICUS
By:_____________________________
By:__________________________________
Michael B. O’Kelly, City Manager
Name:_________________________
Date:
Title: ___________________________
Date:
APPROVED AS TO FORM:
By:__________________________________
Stephanie Vasquez, City Attorney
Date:
EXHIBIT “A”
AGREEMENT
EXHIBIT “B”
GRANICUS 2024 INVOICE
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5811 LIVE OAK STREET
BELL GARDENS, CALIFORNIA
T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700
EXECUTIVE SUMMARY
Subject Property:
Location:5811 Live Oak Street
Bell Gardens, California
Assessor's Parcel No.:6227-004-900
Site Area:1,050 sf (per calculations provided by the City) Zone:C-4, Heavy Commercial
Flood Hazard:Zone X, minimal flood hazard
Census Tract No.:6041.00
Present Use:Cellular equipment site
Improvement Description:Paving, iron wrought fencing and equipment building.
Highest and Best Use:Assemblage
Date of Value:June 13, 2023
Interest Appraised:Lease fee
Final Value Estimate:$170,000
T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700
TABLE OF CONTENTS
Page
Letter of Transmittal............................................................
Aerial........................................................................
Executive Summary.............................................................
Table of Contents...............................................................
CLIENT........................................................................1 INTENDED USERS...............................................................1 INTENDED USE.................................................................1 EXTRAORDINARY ASSUMPTIONS................................................1 HYPOTHETICAL CONDITIONS....................................................1 EFFECTIVE DATE OF VALUE OPINION............................................1 DATE OF REPORT...............................................................1 PURPOSE OF THE ASSIGNMENT..................................................1 SCOPE OF WORK................................................................1 REPORT OPTION................................................................3 DEFINITIONS...................................................................3 PROPERTY RIGHTS APPRAISED..................................................3 EXPOSURE AND MARKETING TIME...............................................4 SUMMARY DESCRIPTION OF THE REAL ESTATE APPRAISED.......................4 Market Area...............................................................4 Market Overview...........................................................7 Site Map.................................................................10 Ownership History.........................................................10 Location.................................................................10 Legal Description..........................................................10 Land....................................................................11 Zone....................................................................11 Improvements............................................................12 Occupancy...............................................................12 Highest and Best Use - As Vacant.............................................12 VALUATION...................................................................15 Sales Comparison Approach - Remnant and Small Lot Sales Value Analysis...........15 Sales Comparison Approach - Assemblage Valuation Analysis......................21 Discounted Cash Flow Analysis..............................................23 RECONCILIATION AND FINAL VALUE ESTIMATE.................................25 CERTIFICATION AND RESTRICTION UPON DISCLOSURE AND USE.................26 ASSUMPTIONS, CONTINGENT AND LIMITING CONDITIONS........................27
ADDENDA
Subject Photographs.................................................................
Legal Description...................................................................
Ground Lease......................................................................
Qualifications
Jeffrey T. Nagasaki, MAI......................................................
T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 CLIENT
Tierra West Advisors, Inc. and City of Bell Gardens
INTENDED USERS
The client and others as appropriate.
INTENDED USE
It is the intended use of this appraisal to provide the client with an estimate of the market value of the subject for use in the client’s possible disposition and sale.
EXTRAORDINARY ASSUMPTIONS
None.
HYPOTHETICAL CONDITIONS
None
EFFECTIVE DATE OF VALUE OPINION
The date of value used in this report is June 13, 2023.
DATE OF REPORT
This report is dated June 23, 2023, generally corresponding to the completion of our current investigations, analyses of relevant data, and completion of this report document.
PURPOSE OF THE ASSIGNMENT
The purpose of this appraisal report is to provide our opinion of the market value of the leased fee interest of the subject property, as land only, for the possible sale as a remnant site to an adjoining property owners.
SCOPE OF WORK
We determined the scope of work necessary to meet the requirements of a comprehensive appraisal analysis.
We confirmed the zoning of the subject property with the City of Bell Gardens, reviewed property ownership, and reviewed Assessor’s maps. We completed a field inspection of the subject property, reviewed the subject and adjoining sites, took photographs and noting the characteristics of the property that are relevant to its valuation. The appraisal problem did warrant a highest and best use study. Given the nature of the subject real estate, our conclusion of highest and best use was based on logic and observed evidence. This involved a review of the value as vacant land in a determination of the highest and best use of the property. We reviewed the potential uses available to the subject property consistent with its shape and size, as well as underlying zoning and general plan designation. After careful study, we concluded that the highest and best use of the subject property was assemblage with the adjoining the site to the north and west of the subject.
The subject site is currently under ground lease to New Cingular Wireless PCS, LLC which initially began July 23, 1991 for an initial ten year term with (2) five year options to extend. The original lease has been subsequently amended with lease terms which began August 1, 2011 to include an initial five year term with (5) additional five year terms. Our analysis of the subject property includes a discounted cash flow in the Income Approach which considers the current and projected rental income and reversion value of the land at lease termination. The lease was automatically renewed under the current lease on August 1, 2021 and will 1 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 end on July 31, 2026. The lease will include annual 4% increases through the end of the term. We have completed our analysis based on the current lease until its term end of July 31, 2026.
We need to now consider the reversion value of the land at lease termination and only the Sales Comparison Approach was considered a reasonable valuation measure in the context of the subject site. We completed two studies to determine the market value of this remnant site. The first approach was to consider remnant lots purchased in the open market for various purposes, but each having the same limited utility and size that essentially precluded independent development. We located transactions over a broadened time frame and geographic area due to the limited number of sale transactions. We studied sales transactions considering the size, topography, location and topography of the subject. We compared and contrasted the features of the comparable sales with the subject. In this investigation of market data we utilized the Multiple Listing Service, Loopnet, and CoStar Comps, Inc. This provided us a direct methodology of the Sales Comparison Approach, to determine the market value of the subject site.
As a second method we considered the site “as assembled” with the adjoining property to determine the value of the entire site combined. This considered the zoning and utility of the adjoining site to the north and improved with an office building. The site is fully suited for development without the subject. We studied sales transactions of commercial land in the subject location, considering the size, topography, location and zone of the subject. We arrived at a concluded unit rate for the entire site on a price psf of site area. We then applied the pro-rata unit rate and considered the impact of the limited marketability of the site to the open market of alternative buyers and sellers, as required by definition of market value. We discounted the pro-rata unit rate to arrive at the market value of the subject site, available to the broader market of potential buyers and sellers, inclusive of the adjoining property owner, but not exclusively to that potential buyer.
In order to determine the leased fee interest in the land (ground lessor’s interest) we need to calculate the present value of the ground rental payments and reversion value of the land at the end of the lease term. We have done this using a discounted cash flow model. We began with the market value of the underlying land today, to use in the projected reversion value of the land, and described above. We then utilized a discounted cash flow to arrive at the ground lessor’s interest in the land. The resulting conclusion provides the leased fee land value of the subject site.
Our investigations included research of public records through the use of commercial sources of data such as comparable data services and computerized databases. Search parameters such as dates of sales, leases, locations, sizes, types of properties, and distances from the subject started with relatively narrow constraints and, if necessary were expanded until we retrieved data sufficient to estimate market value, or until the we reasonably exhausted the available pool of data. Researched sales data were viewed and efforts were made to verify the data with persons directly involved in the transactions such as buyers, sellers, brokers, or agents.
In addition, we considered any appropriate listings or properties found through observation during the appraiser’s data collection process.
We then completed an appraisal in compliance with the Uniform Standards of Professional Appraisal Practice as promulgated by The Appraisal Foundation and the Code of Professional Ethics and Certification Standard of the Appraisal Institute. The results of our studies are presented in a Summary Appraisal Report, as defined in USPAP, which will include photographs of the subject property, descriptions of the subject neighborhood, the site, any improvements on the site, a description of the zoning, a highest and best use analysis, a summary of the most important sales used in the appraiser’s valuation, a reconciliation and conclusion with maps illustrating the sales in relationship to the subject property and other data deemed by the appraiser to be relevant to the assignment. Pertinent data and analyses not included in the report may be retained in the appraiser’s files. This report is subject to the “Certification and Restrictions Upon Disclosure and Use” and “Contingent and Limiting Conditions upon Which this Appraisal is Made.” In addition, this report is subject to the special conditions outlined in the transmittal letter. 2 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700
REPORT OPTION
This report is an Appraisal Report in accordance with the reporting requirements set forth under Standards 2-2(a) of the Uniform Standards of Professional Appraisal Practice (USPAP). The Appraisal Report will summarize the details relevant to the valuation and appraisal process. Supporting documentation for this format is contained within our files.
DEFINITIONS
Title 12 of the Code of Federal Regulations Section(s)34.41 and 323.3 define market value as:
The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby:
1)The buyer and seller are both typically motivated;
2)Both parties are well-informed or well-advised, and each acting in what they consider their own best interest;
3)A reasonable time is allowed for exposure in the open market; 4)Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and
5)The price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale.
TheDictionary of Real Estate Appraisal, Sixth Edition, by the Appraisal Institute, defines the following:
The Fee Simple Estate is defined as:
“Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat.” Leased Fee Estate is defined as:
“The ownership interest held by the lessor, which includes the right to receive contract rent specified in the lease plus reversionary right when the lese expires.” Assemblage is defined as:
“1. The combining of two or more parcels, usually but not necessarily contiguous, into one ownership or use; tile process that may create plottage value; See also plottage value. 2. The combining of separate properties into units, sets, or groups, i.e., integration or combination under unified ownership.”
Plottage is defined as:
“The increment of value that often occurs when two or more sites are combined to produce greater utility, resulting in a higher productivity or income than could be obtained from the individual smaller sites. See also assemblage.”
PROPERTY RIGHTS APPRAISED
The property rights herein appraised consist of the leased fee interest in and to the subject property, excluding mineral rights.
3 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700
EXPOSURE AND MARKETING TIME
This refers to the estimated length of time the property interest being appraised would have been offered on the market prior to the hypothetical consummation of a sale at a market value on the effective date of the appraisal; a retrospective estimate based on the analysis of past events assuming a competitive market. In the subject’s case, the exposure time was estimated to be six to nine months. We have also analyzed potential marketing time for the subject project. Our marketing time considers the current environment of demand for commercial land properties in the greater Southern California region. In addition this reflects the current environment of higher interest rates and potential for recessionary economic conditions and its impact on sale prices and purchase decision-making. We estimate that the marketing time would be six to nine months, assuming sufficient exposure to the market.
SUMMARY DESCRIPTION OF THE REAL ESTATE APPRAISED
Market Area
The County of Los Angeles contains approximately 4,083 sq. mi. It is bounded on the north by Kern County, on the east by San Bernardino County, on the southeast by Orange County, and on the northwest and west by Ventura County and the Pacific Ocean, respectively. The population estimate developed by the California Department of Finance as of January 1, 2023 was 9,761,210 a nominal 0.7% decrease from 2022.
Forty-five years ago, Los Angeles was the leading farm county in the nation. However, agricultural importance has since waned due to urban and industrial expansion. Today, the county’s varied economic base 4 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 includes trade, transportation, and utilities, government, educational and health services, professional and business services, and manufacturing. Tourism and entertainment, as well as international trade, also play a vital role in the county’s economy. Employment statistics have continued to show declining unemployment rates, after the years of recessionary conditions. Continued improvement of economic conditions are impacting growth and expansions affecting the region, state and nation. The economy has shown strong employment and fundamentals with growth projected at a positive pace, better than that of the state and other parts of the region.
According to the California Department of Finance April 2023 Monthly Following an increase of 7.8% in 2021-the highest growth rate since 1984-California real Gross Domestic Product (GDP) grew by 0.4% in 2022. The state's deceleration was sharper than the U.S., as the nation's real GDP growth slowed from 5.9% in 2021 to 2.1% in 2022. California's share of U.S. real GDP fell to 14.4% in 2022 from 14.7% in 2021, but remained just above its pre-pandemic level of 14.3% in 2019.
Also in 2022, California personal income increased by 0.4% after 7.7% growth in 2021, while U.S. personal income grew by 2.4% after 7.5% growth. Total wages and salaries continue to be the main driver of personal income growth for both the state and the nation, with California total wages (not adjusted for inflation) increasing by 5.7% in 2022 and U.S. total wages increasing by 9.1% (the highest growth rate since 1984), following growth of 11.4% and 8.9% in 2021, respectively. California's share of U.S. personal income decreased to 13.8% in 2022, in line with its 2019 share, after increasing to 14.1% in both 2020 and 2021.
I NFLATION&L ABOR M ARKET C ONDITIONS
U.S.
·U.S. headline inflation slowed for the ninth consecutive month in March, falling to 5% year-over-year from 6% in February and from its peak of 9.1% in June 2022. The decline was driven by year-over-year gasoline deflation, as gas prices had risen sharply from February to March in 2022 due to the Russian invasion of Ukraine. Core inflation- excluding food and energy-rose 0.1 percentage point from February to 5.6%. Shelter inflation, which measures rent currently paid by tenants, also rose 0.1 percentage point from 8.1% in February. This measure typically changes more slowly than other components due to contract leases.
·The U.S. unemployment rate fell 0.1 percentage point to 3.5% in March. The nation added 236,000 nonfarm jobs in March, with eight major sectors gaining jobs: leisure and hospitality (72,000), private educational and health services (65,000), government (47,000), professional and business services (39,000), other services (11,000), information (6,000), trade, transportation, and utilities (4,000), and mining and logging (3,000). Three sectors lost jobs: construction (-9,000), manufacturing (-1,000), and financial activities (-1,000).
UILDING A CTIVITY &R EAL E STATE
B
·Year-to-date through February 2023, California permitted nearly 105,000 units on a seasonally adjusted annualized rate (SAAR) basis, down 6.4% from January 2023, and down
13.4% from February 2022. February 2023 total permits consisted of over 45,000 single-family units (up 4.9% from January 2023, but down 34.9% year-over-year) and nearly 59,500 multi-family units (down 7.5% from January 2023, but up 15.9% year-over-year). ·The statewide median price of existing single-family homes increased to $791,490 in March, up 7.6% from February 2023, but down 6.8% from March 2022. Sales of existing single-family homes in California totaled 281,050 units (SAAR) in March 2023, down 1% from February 2023, but down 34.2% from March 2022. The average 30-year mortgage rate for March 2023 was 6.54%, up from 6.26% in February 2023 and up from 4.17% in March 2022.
The City of Bell Gardens has a rich history dating back to the late 1700's when the area was associated with a large amount of land situated along the lower basin of the Rio Hondo area in Los Angeles County. Bell Gardens was once a bustling agricultural center for immigrants escaping the Mexican government. The land’s original adobe dwelling was built in 1795 and named Casa de Rancho San Antonio by Lugo. When Gage occupied the residence, he added two wings and redwood siding, installed bronze fireplaces, and imported 5 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 expensive fabric wallpaper from France to serve as background for the Gage coat of arms, which enjoys a place of prominence in every room.
’early history.
Because of the rich soil and abundant land, many Japanese immigrants are part of Bell Gardens Japanese Gardeners leased land and farmed to produce quality vegetables for the marketplace. Rice fields also mushroomed within the city limits of Bell Gardens. With some of the richest agricultural land in the country, Bell Gardens remained a farming community until the 1930's. In 1927 Firestone Tire Company bought some of the land at $7,000 an acre. By 1900, Bell Gardens was divided into tracts of 40 to 100 acres. The land adjoining the city of Bell became known as Bell Gardens. In 1930, O.C. Beck purchased property and begins to build affordable homes for those suffering through the depression era. World War I and World War II brought defense plants to the area that helped build the economic stability and the population, which led to construction of new homes, more schools, and a prosperous business climate. Today, only a 2.4 square mile city, Bell Gardens maintains only a small portion of the original Lugo land grant, which is located at the site of the Casa Mobile home Park on Gage Avenue.
Bell Gardens is a relatively young city. Since its incorporation on August 1, 1961, Bell Gardens has grown from a population of approximately 4,000 to around 47,000. The median age is 27.3 There are six elementary schools, two intermediate schools, one high school and two adult schools. According to the California Department of Finance, the January 1, 2023 population estimate is 38,447 a 0.8% decrease from 2022. There are 9,986 housing units with 24% owner occupied by 76% renter occupied. Median household income was $38,170.
Demographic information for the subject was provided by Environmental Systems Research Institute (ESRI), a leader in geographic information systems (GIS). The demographics analyzed were 2022 estimates by ESRI 6 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 for the area located within a one, three and five mile ring of the subject property. The following table shows the results for the subject.
2022
1-mile ring3-mile ring5-mile ring
Population36,062330,109859,015
Households7,69589,214228,187
Average Household Size3.883.673.73
Median Age28.531.030.4
Median Household Income$50,458$62,116$60,471
Average Household Income$66,483$84,040$81,459
Per Capita Income$16,923$22,722$21,659
In addition to the resident population, there are 7,245 businesses in a one-mile ring with a employee population of 53,998, providing additional potential customer base. There are 2,329 (4.0%) owner-occupied housing units in a one mile radius with 50,421 (87.7%) renter-occupied housing units. Median home value for 2022 is $616,323 and average home value of $690,523 for the one mile ring. The area provides a modest income level in a predominantly rental housing market surrounding the subject, which also benefits from moderate commercial traffic volume near the subject property.
The subject property is located just north side of Live Oak Street . Live Oak Avenue is developed with the Bell Gardens Village Square shopping center anchored by Marshalls, Ross Dress For Less and Applebee’s restaurant. The Quality Inn hotel, Bell Gardens Intermediate school are also along the north side of the street.
Along the south side of the street are smaller multiple residential development. Most of the commercial development is located along Eastern Avenue with extensive retail and commercial development. The Bicycle Hotel and Casino is located on the west side of Eastern Avenue at Florence Avenue. The area is convenient to the transportation linkage of the Long Beach Freeway (Interstate 710) with on- and off-ramps on Florence Avenue.
Market Overview
According to CBRE Marketview Greater Los Angeles Retail Q4-2022 - “2022 finishes strong despite macroeconomic challenges”. While global and national concerns abound regarding the looming financial downturn, many economists are predicting that the potential recession will not be as bad as previously anticipated. Despite increased lending requirements and concerns regarding credit volatility, it is anticipated that interest rates will begin to level throughout 2023, barring further economic shifts as inflation and the labor market begin to coo1. In an attempt to mitigate lowered consumer confidence, retailers will continue to enhance the overall consumer experience. Superior customer service and the integration of technology like "walk-out-purchasing" will be vital to luring consumers back to stores, restaurants, and other retail destinations. Additionally, as consumers continue to purchase more environmentally friendly goods, look for retailers to gravitate towards becoming more ESG-friendly. Demand for 2nd generation and high street retail space remains strongly favored and that will sustain throughout 2023.
RentableOverall VacancyAverage Asking
Area SFRates %Rates
Sub-Market
Antelope Valley 8,136,4306.1%$1.56
Greater Downtown2,658,80712.0%3.49
Mid-Cities12,308,7954.2%2.37
Mid-Wilshire3,661,3145.8%3.14
San Fernando Valley15,014,9786.3%2.78
San Gabriel Valley20,703,4575.4%2.46
Santa Clarita Valley5,905,3235.3%2.54
7 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 RentableOverall VacancyAverage Asking
Sub-MarketArea SFRates %Rates
South Bay20,150,8013.6%2.72
Southeast Los Angeles7,269,3135.0%2.05
Tri-Cities9,204,9626.6%3.32
Ventura22,339,3235.1%2.34
West Los Angeles5,320,16112.6%5.80
Greater Los Angeles Area132,673,6645.6%2.77
th
Source: CB Richard Ellis 4 Quarter 2022
Overview:
·Vacancies in high street retail-corridors declined quarter-over-quarter, while vacancies in B- Class and lower markets saw increases.
·Woodland Hills experienced the largest retail sale across Greater Los Angeles when Kroenke bought The Village for $325 million.
·Measure ULA, which imposes an additional tax on transactions valued at $5 million or greater, was passed in Q4 2022 If a sale is between $5 million and $10 million, the tax rate will be 4.5% and any transactions greater than $10 million will be taxed at 5.5%. Previously on a sale, only the capital gains from the transaction would be taxed. With measure ULA, the tax rate is applied to the entire purchase price.
·Asking rents gradually increased throughout 2022 and are expected to continue that upward trajectory in 2023.
·As costs for ground-up developments continue to rise, look for retail developers and investors to pivot and focus on redesigning existing retail properties to attract more consumers.
Los Angeles County's seasonally unadjusted unemployment rate was 4.5% as of December 2022. While this rate stood higher than the CA state rate of 4.0'%, LA County's unemployment has cooled down from 4.9% quarter-over-quarter. The Transportation and Warehouse sector continued to post strong employment numbers at 219,600; a 1.4% increase quarter over quarter and 4,3% increase year-over-year. Although the retail workforce is beginning to level out after experiencing historic highs in both quits and job openings in late 2021 and into 2022, retailers will continue to have their hands full trying to find enough employees to fill their operations. Implications tied to staffing and employee compensation will persist in 2023 as many retailers continue to be short-staffed. The incorporation of technology to repeatable or simplified tasks, will prove valuable amidst a lack of qualified employees and high costs associated with hiring. Greater Los Angeles's average asking lease rate finished $2.77 in Q4-2022, experiencing no change quarter-over-quarter but increasing $0.02 year-over-year. Despite macroeconomic headwinds in 2022, Greater Los Angeles's asking rate remained steady throughout the year. never dipping below $2.73.
Total leasing activity declined 13% quarter-over-quarter, finishing at 21M total sq. ft. leased in Q4- 2022.
Although Greater Los Angeles posted 57,762 sq. ft. of negative absorption in Q4, several submarkets finished out the year on a high note. Mid-Cities and the San Gabriel Valley had the strongest quarters. recording 44,084 sq. ft. and 34,704 sq. ft of positive net absorption, respectively.
There were no construction deliveries reported in Q4 2022. 400,000 sq. ft. is currently under construction at Del Amo Blvd - Phase 1, in Torrance and is set to deliver in December of 2024. Hollywood Park is the largest retail project that is currently under construction in GLA. The 300-acre development next to SoFi Stadium is set to encompass 890,000 sq. ft. of retail space. This substantial retail development is 65% leased or under negotiations, and will be home to a vast range of tenants. Large tenants like Cinepolis and smaller tenants like Red Bay Coffee will be able to take full advantage of the foot traffic that spills over from the stadium, offices, and residential properties that are all within walking distance. 8 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 Concerns surrounding inflation and labor markets are some of the chief concerns for the Federal Reserve heading into the new year. This exposes the market to interest rate risk as previous low yield bonds will be devalued by higher yield bonds in the open market. This could cause instability in sectors and portfolios who have a higher exposure to debt securities in the near term. In addition to risk. this has materially affected the world of real estate capital markets with investment volume deceleration as debt has become more selective.
If trends continue, cap rate will decompress along with property pricing adjustments to attract more equity based cash buyers.
Total sales volume reached its lowest level over the span of the past five consecutive quarters, but remained higher than the historical average. Class A retail sales volume saw a 74% decrease quarter-over-quarter, while Class B property sales experienced a 25% decline quarter-over-quarter. The most active markets measured by total sq. ft. transacted includes the San Fernando Valley, East Los Angeles, and the South Bay.
TH
S OUTHEAST LOS A NGELES R ETAIL M ARKET 4Q UARTER 2022
TotalTotalOverall
No. ofBuildingVacantVacancyLease Rate
MarketBldgs.SFSFRate(SF/Month)
Southeast Los Angeles357,629,313363,1655.00%$2.05
9 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 Site Map
Ownership History
The subject property currently shows title held by:
City of Bell Gardens
We do not have details on the original acquisition of the subject site. The subject was owned by the Bell Gardens Community Development Commission and was transferred to the City of Bell Gardens on August 2, 2011 via Document No. 35684. The City is in process of returning title to the City of Bell Gardens Successor Agency. The subject property is not listed for sale. There have been no market transactions involving the subject property in the last five years.
Location
The subject site is located on the north side of Live Oak Street and has the following address:
5811 Live Oak Street
Bell Gardens, California 90201
Legal Description
The complete legal description is contained in the legal description located in the mapping in the Addenda. 10 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 Land
Shape:Rectangular;
Dimensions:20 ft. x 52.50 ft.
Area:1,050 sf (per the City)
Topography:Level at street grade.
Soils and Drainage Conditions:No soil report has been made available, but a visual inspection of the subject and surrounding properties and developments revealed no other adverse conditions. Our conclusions are subject to revision pending receipt of a soil report.
Hazardous Substances:We have not reviewed a site assessment for the subject property.
There does not appear to be any obvious negative environmental issues that might impact the marketability and/or the value of the subject property. Our appraisal report is subject to review of the environmental assessment report and the following of any clean-up recommendations contained in that report.
Zone
The subject site is zoned C-4, Heavy Commercial for the city Bell Gardens. The C-4 zone was established to provide for regional commercial needs. This zone provides for intensive commercial activities and specialized service establishments that require a central location within a large urban population. It also permits the development of wholesale businesses and major financial and administrative centers that may serve an entire region. It permits a broad variety of retail, office and commercial uses including those permitted under the C-3 zoning. The zoning does not permit residential uses. Minimum lot size is 15,000 sf maximum FAR of 5.0 and 90% lot coverage. Parking requirements are generally one space per 250 sf for retail uses, one space per 300 sf for offices, one space per 200 sf for medical offices, one space per 21 sf of seating area or for every three fixed seats, plus one space for each two employees for restaurants.
Assessor's Parcel No.: None
Assessed Value:
Land: None
Improvements:None
Total:None
Actual Taxes:As publically owned land the subject is exempt In accordance with Proposition 13, the subject would be reassessed under sale or other subsequent transfer to a private ownership.
We have reviewed a title report for the adjoining subject parcel. Visual inspection of the subject property revealed no apparent conditions that would negatively impact property value. All of the usual and necessary public utilities are available to the subject property.
The subject property enjoys full pedestrian and vehicular access to Live Oak Street, a local east/west right of way dedicated to a width of 50 feet, with one lane in each direction. Parallel parking is permitted along both sides of the street in front of the subject. The right of way has asphalt paved surface, and includes concrete curbs, gutters and partial sidewalks.
11 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 Improvements
The subject property has asphalt paving, iron wrought fencing, and equipment structure with cellular tower.
Occupancy
The subject site is currently under ground lease to New Cingular Wireless PCS, LLC which began July 23, 1991 for an initial ten year term with (2) five year options to extend. The original lease has been subsequently amended to begin August 1, 2011 for an initial five year term with (5) additional five year terms. According to the terms of the lease the current rent is $4,345.05 per month with an annual lease adjustment of 4% to occur on August 1, 2023. The projected rent on that date will be $4,518.85. The tenant is responsible for all utilities, maintenance and taxes associated with the property.
Highest and Best Use - As Vacant
Highest and Best Use as defined by The Appraisal of Real Estate, 14th Ed., Appraisal Institute: Chicago, Illinois, is:
"The reasonably probable and legal use of vacant land or improved property, which is physically possible, appropriately supported, financially feasible, and that results in the highest value. The four criteria the highest and best use must meet are legal permissibility, physical possibility, financial feasibility, and maximum productivity. Alternatively, the probable use of land or improved property -specific with respect to the user and timing of use-that is adequately supported and results in the highest present value"
Our analysis of Highest and Best Use includes two studies: Highest and Best Use of land as if vacant, and Highest and Best Use of property as improved. The highest and best use of both land as if vacant and property as improved must meet four criteria. The highest and best use must be legally permissible, physically possible, financially feasible, and maximally productive.
Legally Permissible:Under the present C-4 zone, uses are primarily limited to commercial uses but does not allow residential development. It is clear that the overall location and development trends would suggest that a retail project would be consistent with the current land use in the area, as well as the existing zoning. There are limitations on setback and size which would impact use and independent development s.
Physically Possible:The subject is a narrow site with a total of 1,050 sf, level at street grade. The size does not meet the base standard for development.
Therefore as a single site it requires assemblage with any adjoining site to provide an adequate base for development consistent with the legally permissible uses.
Financially Feasible:Those improvement programs that would produce a positive return on the investment required to construct them. Rent levels and sale prices for retail properties had been increasing over the last several years, but due to rising interest rates and potential for economic recession, this trend has slowed. A review of current construction costs plus land when compared with the sale prices for newer developments indicates that these new developments have been feasible in recent market, however the rising interest rates has made the availability for funds for financing new projects limited. This is supported by the recent slowing trend of new development and construction which is occurring in the general region. Any use or development of the subject site would 12 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 require some assemblage to provide an adequate base for development and adequate area for construction. The independent development of the subject is not achievable, the only financially feasible use of the subject would be assemblage with the adjoining site consistent with its physically possible uses.
Maximally Productive:The maximally productive use is that which results in the highest return to the subject property. Economic factors are not fully conducive to development. Therefore, we conclude the maximally productive use for the subject site, as vacant, is assemblage with the adjoining site.
Assemblage with the adjoining lot to the north and west appears feasible and does provide a significant benefit for access parking and utility. Thus, assemblage with this site appears viable and the highest and best use of the subject site.
13 14
MARKET DATA MAP - SMALL AND REMNANT LOT SALES
T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700
VALUATION
Our assignment involves the valuation of the 1,050 sf subject site with commercial zoning and a highest in best use as an assemblage site with adjoining improved commercial property. The subject is currently under a ground lease as a cellular tower site. Our analysis of the subject includes a discounted cash flow in the Income Approach which considers the current and projected rental income and reversion value of the land at lease termination. The lease was automatically renewed under the current lease on August 1, 2021 and will end on July 31, 2026. The lease includes annual 4% increases through the end of the term. We have completed our analysis based on the current lease until its term end of July 31, 2026.
We need to consider the reversion value of the land at the end of the July 2026 lease termination and only the Sales Comparison Approach was considered a reasonable valuation measure in the context of the subject site. We have utilized two methodologies in order to analyze and determine the market value of the subject site. Initially, we analyzed the valuation of the subject site as a remnant parcel to be acquired for the use in a passive manner absent ultimate development. We have collected and obtained remnant parcel acquisitions of sites which ultimately could not be developed. The variety of transactions across Southern California provided us a base of potential values for the subject property. In the second methodology, we have analyzed the subject property as vacant commercial land, assembled with the site at 5800-5810 Florence Avenue creating a 288,672 sf (6.627 acre) site. In this study, we considered commercial land sales comparing and contrasting them with the assembled site. We then considered that the unit rate assumes the site would be suitable for development as a larger single parcel. There is one other adjacent ownership which might consider assemblage, but as a public school site, there are no benefits afforded by the small site area. It is therefore clear that the limits of the site’s development are restricted and thus we must discount its value to reflect this lack of independent marketability. We considered an appropriate discount for the subject. This approach provides another methodology to consider the valuation of the subject property. Ultimately, we considered each of these approaches in our analysis and determination of market value.
Sales Comparison Approach - Remnant and Small Lot Sales Value Analysis The market for vacant land sales within the subject’s vicinity was surveyed to obtain sale information for our use in estimating the market value of the subject property at reversion. In our search, we considered sales of smaller sites, which may or may not allow use or development, that are relevant in size to the subject. We initially focused on sales of smaller sites located within the Bell Gardens area. However, with the limited set of initial sales, we expanded our search both by sale data and geographic range to include sales from 2005 to the present in the Los Angeles and Orange County areas. From the initial body of data, we narrowed our search to those sites with similar physical characteristics of the subject.
Our data search for sales of comparable properties extended from January 2005 to the present. The data items are summarized on the following table and are displayed geographically on the market data map. The sources of market data include records of the Los Angeles and Orange County Assessor’s compiled by First American Real Estate Solutions LLC, Comps, Inc., the Multiple Listing Service, and interviews with knowledgeable local brokers who specialize in the marketing land in the area.
SMALL AND REMNANT LOT LAND SALES
SOUTHERN CALIFORNIA
SALE PRICE
SaleSite
Psf
Zone
No.LocationDateArea
TotalLandComment
18059 Maple Street10/052,025R1$15,000$7.41Purchase of independent site; Bellflowernot by adjoining property
owner.
2Mermac Street3/061,934C260,00031.02Alley access only.
San Pedro
15 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 3a13327 Telegraph Road3/062,247C1 14,500 6.45Purchase as speculation; Whittier
3b10/06 35,000 15.58Purchase by adjoining property
owner for assemblage
4NWC Clarkdale & Aclare3/074,029RS-650057,00014.15Assemblage by adjoining Cerritosproperty owner
5NS of Ellis Avenue8/072,800OS-PR50,00017.86Purchase as speculative lot; Huntington Beachsold by NRRL
6NS of Gardenglen Street3/082,415R14,9002.03Purchase by adjoining property West Covinaowner
th
7204 10 Street5/082,500R50,00020.00Purchase as assemblage by a Seal Beachbuyer of the adjoining site for
residential development
8SS of Spring Street9/082,750SP438,75014.09Assemblage purchase by the Long BeachSignal Hill RDA
9SS of Spring Street9/082,750SP438,75014.09Assemblage purchase by the Long BeachSignal Hill RDA
10NS of Maple St/Michigan2/152,588RM-4818,0006.96Triangular site with full street Pasadenafrontage
113814 St Andrews Place5/201,216R226,50021.79Walk street; purchased by Los Angelesadjoining property owner.
123807 St. Andrews Place10/201,111R130,00027.02Walk street; Los Angeles
134649 Ivy Street10/20610SF5,0008.20Triangular site purchased by Pico Riveraadjoining property owner
148001 N. Bonfield Avenue9/221,146R121,00014.83Purchased by adjoining North Hollywoodproperty owner for assemblage
We therefore considered necessary to determine the impact on land sale prices across the region since 2005 to provide a foundational basis for any relevant adjustment for market conditions. We included a study of the trend in Los Angeles and Orange county land prices since 2010 for sites in between one-quarter and five acres in size. The information was obtained from CoStar Trend Report and shown on the following graphic page. The past thirteen years have been subject to fluctuation but has shown a steady increase of prices and demand for land with the improving economy, affordable interest rates, and general improvement in economic indicators. This comes after the recession of 2008 and 2009 during the last financial crisis. As a result the demand and prices paid for land has been moving upward with the increases in the numbers of transactions and prices paid. There has been a slowing of this trend given the recent increases in the recent increase in financing costs due to the moves by the Federal Reserve to raise the Federal Funds rates in order to stem the dramatic rise of inflation rates. This also may reflect some resistance due potential for recessionary conditions into the near future.
In comparing these transactions to the subject property, we consider the time of sale, conditions of sale, general location, site size, and development potential. Land sales of the size and character of the subject are priced on a total sale price and price psf basis. Factors of comparison were considered in this analysis include general location, including surrounding properties, comparable development, density, and general improvements.
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T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 Item No. 1 is the sale of a site purchased by a nearby property owner for use as a garden. Site size is too small for independent development and R1 zoning provides no attributable benefits for added assemblage or development. Location is similar. Date of sale is inferior. Larger site size is inferior on a price psf basis.
Overall, we would expect the subject to sell for a greater rate to this item.
Item No. 2 is a site located on Mermac Street in San Pedro. This is a small alley type street and is a C2 zoned lot. The site is too small for independent development and was purchased by a user for lot storage. The site remains an open lot, is similar in C2 zoning and ultimately could be developed with some commercial development. Date of sale is inferior and lot size are similar. Overall, we would expect the subject to sell for a lesser rate than this item.
Item No. 3 is the sale of a commercial lot that was designated as excess by a local water company. The buyers were speculators interested in “flipping” the property to another property owner. The lot is inferior in location due to alley access only. Date of sale is inferior. Location is slightly inferior. The conditions of sale were considered inferior and below market. They subsequently sold the site in Item No. 3b to the adjoining property owner at a sizable increase. Overall we would expect the subject to sell for a rate higher than the initial purchase but in line with the more recent of the purchase.
Item No. 4 is the sale of a site on Clarkdale Avenue in Cerritos. Date of sale is slightly superior. Larger site size is superior. The property is zoned single family residential use but it is too small for independent development. The site is located adjacent to a church facility and a vacant development site. The property was purchased by the adjoining developers of the vacant site. The property, given its size and characteristics provides no significant contribution to the assemblage value of the larger adjoining site. It was offered on the open market for $62,500 but no other buyers considered purchasing the property. Lack of build ability was a significant factor although it enjoys corner exposure and two street frontage. Overall, we would expect the subject to sell for a greater rate.
Item No. 5 is the sale of an “encyclopedia lot” in Huntington Beach. Date of sale is inferior. The site was purchased from a firm that sells sites for speculative use by marketing them to distant and foreign buyers. The owners continue to pay property taxes and apparently have not defaulted on the property. This transaction is indicative of the sale of speculative lots to unsophisticated buyers as potential investment lots. We did not give much weight to this sale but recognize that the transaction due to its location.
Item No. 6 is the sale of a small remnant parcel which is R1 zoned and located in West Covina. The site is too small to be developed into an independent site and was offered to the open market. The buyer was the adjoining property owner who essentially utilizes it as open space. It provides no additional contribution for density, as the single family zone regulations limits development to the combined site of only one residence.
Date of sale is inferior. Overall the size and characteristics of the site, we would consider the subject to sell for a greater rate than this item.
Item No. 7 is the sale of small residential lot that is not buildable, but was purchased in a transaction involving the adjoining larger site. The lots in this Seal Beach area are often similar in size to this item and developable under most conditions. The assemblage benefits, zoning and development potential are superior.
The date of sale and site size are similar. Overall we would expect the subject to sell for a slightly lesser rate than this item.
Item Nos. 8 and 9 are the sale of two smaller sites in Signal Hill. The sites were purchased from separate sellers and were assembled by the city for the development of an auto dealership site. Both sites were single sites which are not precluded from development, but certainly so small that any use or development is limited.
The sites are impacted by oil well production. The sites were purchased by the Signal Hill Redevelopment Agency at market value without threat of eminent domain. The sites were purchased for assemblage benefits which is superior. Date of sale is slightly inferior. Overall, we would expect the subject to sell for a similar to greater rate than these items.
18 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 Item No. 10 is a small triangular site with full street frontage in Pasadena. The date of sale is inferior. The site area is similar, but zoning is superior. Location is similar. Overall inferior to the subject.
Item No. 11 is smaller residential site on St. Andrews Place in Los Angeles. The date of sale is similar to slightly inferior. The site is limited in development due to walk street frontage. The site was purchased by an adjoining property owner to expand their rear yard. Location is inferior. Assemblage benefits is superior.
Overall similar to slightly superior.
Item No. 12 is another lot like Item No. 11. However this site was purchased by a nearby property owner for possible development. The date of sale is slightly inferior. Location is slightly inferior. Overall similar.
Item No. 13 is smaller triangular site purchased by the adjoining property owner for use as landscaping front yard. Date of sale is similar to slightly inferior. Smaller lot area is inferior. Assemblage benefits are superior.
Location is slightly inferior. Overall inferior to the subject.
Item No. 14is a triangular shaped site on Bonfield Avenue in North Hollywood. The date of sale is similar.
The site was purchased by the adjoining homeowner for use in expanding his yard. Location is similar. The assemblage benefits are superior. Overall similar.
Based on this set of data we would conclude with a value of the subject at $18.00 psf of site area.
This equates to the following:
1,050 sf x $18.00 psf=$18,900
Rounded:$19,000
19 20
MARKET DATA MAP - COMMERCIAL LAND SALES
T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 Sales Comparison Approach - Assemblage Valuation Analysis This methodology incorporates the valuation of subject property as assemblage with the adjoining Bell Gardens Village Square shopping center parking lot. In the scope of work, we included the adjoining commercial land site and the subject piece assembled as a single parcel. We utilized the base of data of commercial land sales to determine the value of the site assembled with this parcel.
The market for commercial land in the vicinity of the subject property was surveyed to obtain sale information for our use in estimating the market value of the fee simple interest in and to the combined subject site. We focused on commercial land sales that did not include mixed use or multiple residential development due to the current site zoning. The sources of market data were similar to our earlier study. After the market data was collected, the market data items were then compared to the subject property.
COMMERCIAL LAND SALES
SaleSite Area SFSale Price
No.LocationDateZoneArea AcreTotalPsf
112692 Garden Grove BoulevardOct-21HCSP45,302$3,100,000$68.43 Garden Grove1.04
218715 S. Western AvenueOct-21C293,2187,500,00080.46
Torrance2.14
36801 Atlantic AvenueJun-22C354,5503,100,00056.83
Bell1.25
415101 Paramount BoulevardApr-23PD-PS142,8778,600,00060.19 Paramount3.28
5521 E. 29th StreetMay-23SP-1-M240,01616,817,50070.07
Long Beach5.51
In this analysis and in other similar studies, we observed the price per square foot to be the most consistent pricing parameter. Accordingly, our comparative analyses between the sale items has been conducted with the primary emphasis on price per square foot of site area. Elements of comparison included location (surroundings), mid-block or corner exposure, accessibility), size, zoning, topography and site shape. As a reminder, this study considers the combined assemblage of the subject site with the site at 5800-5810 Florence Avenue creating a combined 288,672 sf (6.627 acre) site, with corner exposure and traffic counts of 57,503 ADT (average daily traffic) along Florence Avenue and 23,526 ADT along Eastern Avenue.
Item No. 1 is a commercial site in Garden Grove planned for a medical office complex. Date of sale is only slightly inferior. Location and exposure are similar. Site shape and topography are similar. Smaller site size superior on a price psf basis. Overall similar on a price psf basis.
Item No. 2 is the sale of a commercial site on Western Avenue in Gardena. Date of sale is slightly inferior.
Location is similar in location but commercial exposure is slightly superior adjoining the San Diego Freeway (Interstate 405). The site is presently used as car storage for a nearby car dealership. Smaller site is superior on a price psf basis. Overall, we would expect the subject to sell for a lesser rate than this item.
Item No. 3 is the sale of a smaller site located on Atlantic Avenue in Bell. Date of sale is similar. Smaller site size is superior on a price psf basis. Location is slightly inferior in traffic exposure and commercial development. The mid-block location is inferior. Site shape and topography are similar. The site is planned for a retail restaurant pad with parking and retail building. Overall, we would expect the subject to sell for a similar to slightly greater rate than this item.
Item No. 4 is the sale of a site on improved with a retail building sold for land value in Paramount. Date of sale is similar. The location is a mixed commercial /industrial area slightly inferior to the subject. The traffic 21 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 exposure is similar, but site shape is slightly inferior. The site size is slightly superior on a price psf basis.
Overall, we would expect the subject to sell for a greater rate than this item.
Item No. 5 is the large site located on Cherry Avenue in Long Beach Date of sale is similar. The site was purchased by Long Beach Memorial Hospital, adjacent to its campus to prevent separate development. The location is similar and exposure is similar. The corner location, topography, site size and shape are similar.
Overall we would expect the subject to sell for a similar to slightly lesser rate than this item.
Based upon this analysis, we have concluded with a unit rate of $68.00 to $70 psf of land area for the subject.
This is shown as follows:
1,050 sfx$68.00=$71,400
1,050 sfx$70.00=$73,500
Rounded:$72,000
Discount for Limited Marketability
The above unit rate assumes the site would be suitable for development as a single parcel. There is only one adjacent ownership which might consider assemblage. It is therefore clear that the limits of the site’s development are restricted and thus we must discount its value to reflect this lack of independent marketability. In this context, we consider that a 70% discount on the market value of an assembled site would be reasonable.
As support of this we have considered several purchases of sites in Signal Hill. Two sites were purchased from a separate sellers and were assembled by the city for the development of an auto dealership site. Both sites were single sites which are not precluded from development, but certainly so small that any use or development is limited. Item No. 3 is the recent sale of two adjoining sites. The sites are impacted by oil well production. The sites were purchased by the Signal Hill Redevelopment Agency at market value without threat of eminent domain. This provides an indication of the market value of the combined double lot situation similar to the items shown prior to this item. These sites could be considered on a direct comparison study, but also we considered the discount this provided by comparing it with otherwise normal sites in the same market, for a matched pair comparison. The following are the limited size sites that were purchased for assemblage benefits:
SaleSiteSale Price
No.Location DateZoneAreaTotalPsf Land
1SS of Spring Street9/08SP42,750$38,750$14.09
2SS of Spring Street9/08SP42,75038,75014.09
3ES of Rose Avenue11/08GI5,05353,25010.53
We considered the following three industrial land sales in the market to establish a base land value in order to compare to the smaller sites. These are shown as follows:
SaleSiteSale Price
No.Location DateZoneAreaTotalPsf Land
12000 Walnut Ave.2/07M130,056$1,025,000$34.10
2NS of Grant Ave. 1/08M19,000385,00042.78
th
Street2/08M121,031900,00042.79
33251 E. 19
This results in a range of discount between 59% and 75% from the base land value for the assemblage value of a small site. This assisted us in the discounting process and we concluded that the 70% discount is reasonable. Therefore the conclusion reflects a 30% value (100%-70% discount) and using the total value of $72,000 arrived at in our earlier study, results in the following formula:
22 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 $72,000 x 30%=$21,600
Rounded$22,000
This equates to a price psf of $20.95 psf of land area which is in the range of the sites shown earlier the Small Remnant Lot Sales Analysis.
The underlying land value of the subject property has been analyzed using the two specified methods are shown as follows:
Small Lots Sales Comparison Approach:$19,000
Assemblage Value Analysis:$22,000
We considered two separate methodologies to analyze the subject site. The first analysis provides a direct comparison of remnant sites across a broad geographic area and time frame. This approach is considered relevant because it directly reflects attitudes of buyers and sellers in the marketplace. We have a generous body of data of sales upon which to reflect in valuing the subject. The second approach considered the assembalge of the subject with the adjoining site and discounts the value due to the limited marketability to the variety of potential buyers in the market. It begins with the Sales Comparison Approach, which benefits from a number of larger commercial sales in the subject market area. The concluded unit rate is discounted due to the limited marketability which considers transactions for assemblage sites in Signal Hill area, as well as reasonable consideration of the benefits and utility to the adjoining property owner. There is some economic benefit to the adjoining property owner due to potential increased building area and improved site area, but not on a pro-rated basis of adjoining site, as development of that site can be completed without the subject. However, there should be some value associated with the subject site due to this potential contributory benefit. We considered both approaches in this study, but gave most weight to the direct comparison study and concluded with an underlying land value of $20,000. This is used for the analysis of the discounted cash flow for the reversion value of the site at the end of lease termination.
Discounted Cash Flow Analysis
In order to determine the leased fee interest in the land (ground lessor’s interest) we need to calculate the present value of the ground rental payments and reversion value of the land at the end of the lease term. We have done this using a discounted cash flow model. We began with the market value of the underlying land today, to use in the projected reversion value of the land. We then utilized a discounted cash flow to arrive at the ground lessor’s interest in the land.
Utilizing this figure to estimate the future reversion value of the underlying land at the end of the lease term we have included a 2.5% annual increase of the underlying land. We have limited this increase due to current market conditions of higher interest rates and potential for recession impacting the local, regional and national markets.
The following discounted cash flow provides the ground lessor’s interest in the land as of the date of value.
We used the following assumptions in this study:
The monthly rental payment beginning July 1, 2023 are $4,345.05 and will increase to $4,518.85 on August 1, 2023. The rental rate will grow at 4.0% per year per the lease agreement adjusted st
of each year.
August 1
The reversion value of the land at the end of the lease will be $20,000, grown 2.5% per year until the end of the lease term.
We looked at discount rates for net leased investments via PwC Investors which on a national basis ranged from 6.00% to 10.0%. We also considered the credit ratings of AT&T by Moody’s and Standard and Poor’s of Baa2 Stable and BBBStable respectively. Both ratings are considered at the lower end of investment grade securities. Based upon this, we discounted the income 23 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 stream and reversion value at 8% rate of return (monthly) recognizing the stability of the income stream, fixed payment nature of the adjustments, and remaining term of the investment.
This is shown in the following cash flow:
DateIncome
7/1/2023$4,345.05
8/1/2023$4,518.85
9/1/2023$4,518.85
10/1/2023$4,518.85
11/1/2023$4,518.85
12/1/2023$4,518.85
1/1/2024$4,518.85
2/1/2024$4,518.85
3/1/2024$4,518.85
4/1/2024$4,518.85
5/1/2024$4,518.85
6/1/2024$4,518.85
7/1/2024$4,518.85
8/1/2024$4,699.61
9/1/2024$4,699.61
10/1/2024$4,699.61
11/1/2024$4,699.61
12/1/2024$4,699.61
1/1/2025$4,699.61
2/1/2025$4,699.61
3/1/2025$4,699.61
4/1/2025$4,699.61
5/1/2025$4,699.61
6/1/2025$4,699.61
7/1/2025$4,699.61
8/1/2025$4,887.59
9/1/2025$4,887.59
10/1/2025$4,887.59
11/1/2025$4,887.59
12/1/2025$4,887.59
1/1/2026$4,887.59
2/1/2026$4,887.59
3/1/2026$4,887.59
4/1/2026$4,887.59
5/1/2026$4,887.59
6/1/2026$4,887.59
7/1/2026$4,887.59
Reversion Land Value
8/1/2026$21,537.81
$169,794Income and Reversion
$170,000Rounded
24 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700
RECONCILIATION AND FINAL VALUE ESTIMATE
We utilized an Income Approach in the analysis of the subject site given the current ground lease and is shown as follows:
Discounted Cash Flow:$170,000
We considered two separate methodologies to analyze the underlying value of the subject site for use in the determination of the reversion value. Both approaches provided a reasonable valuation methodology and resulted in similar value conclusions. We then utilized a discounted cash flow recognizing the income the site achieves under the ground lease to the end of the current term and reversionary value of the land arrived at using the Sales Comparison analysis. This provides the economic benefit to the underlying land as a result of the current income stream and return of the land at the end of the current lease term. This was considered the only applicable tool in the valuation of the subject. Therefore we conclude our opinion of the market value of the leased fee interest of the subject site, containing 1,050 square feet, as of the effective date of the appraisal, is:
ONE HUNDRED SEVENTY THOUSAND DOLLARS
($170,000)
25 T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700
CERTIFICATION AND RESTRICTION UPON DISCLOSURE AND USE
I certify that, to the best of my knowledge and belief, . . .
The statements of fact contained in this report are true and correct.
The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions, and are my personal, impartial, unbiased professional analyses, opinions, and conclusions.
I have no present or prospective interest in the property that is the subject of this report and no personal interest with respect to the parties involved.
I have no bias with respect to the property that is the subject of this report or to the parties involved in this assignment.
My engagement in this assignment was not contingent upon developing or reporting predetermined results.
My compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal.
I have not performed an appraisal or other services for the property that is the subject of this report within the three-year period immediately preceding acceptance of this assignment.
The reported analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics & Standards of Professional Appraisal Practice of the Appraisal Institute, which include the Uniform Standards of Professional Appraisal Practice.
The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives.
Paul Serragli provided significant professional assistance to the persons signing this letter. His role in this assignment included assisting in the inspection of the subject property, verifying factual data and market data confirmations. The value opinion contained in this report is that of the undersigned.
As of the date of this report, Jeffrey T. Nagasaki, MAI has completed the requirements of the continuing education program of the Appraisal Institute. Further, as of the date of this report Jeffrey T. Nagasaki, MAI (No. AG003078) has satisfied the requirements as Certified General Real Estate Appraisers, licensed by the State of California.
I have personally inspected the property which is the subject of this report. 6/23/2023
CA# AG003078Date
T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700
ASSUMPTIONS, CONTINGENT AND LIMITING CONDITIONS
·This appraisal report and all of the appraiser’s work in connection with the appraisal assignment are subject to the limiting conditions and all other terms stated in the report. Any use of the appraisal by any party, regardless of whether such use is authorized or intended by the appraiser, constitutes acceptance of all such limiting conditions and terms.
·The appraisal report is a summary appraisal which is intended to comply with the reporting requirements set forth by the Uniform Standards of Professional Appraisal Practice (USPAP) promulgated by the Appraisal Standards Board of the Appraisal Foundation. The report is also compliant with Title XI of the Financial Institution Reform, Recovery and Enforcement Act (FIRREA).
·The report is intended for use only by the addressee of this report, its executives or administrative personnel, advisors and attorneys for purposes relating to the assigned described in the Scope of the Appraisal. ·This appraisal has been prepared for the exclusive benefit of the above-named client and stated intended users. It may not be used or relied upon by another party. Any party who uses or relies upon any information in this report without the preparer’s written consent does so at his own risk. ·The Americans with Disabilities Act (“ADA”) became effective January 26, 1992. We have not made a specific compliance survey and analysis of this property to determine whether or not it is in conformity with the various detailed requirements of the ADA. It is possible that a compliance survey of the property, together with a detailed analysis of the requirements of the ADA, could reveal that the property is not in compliance with one or more of the requirements of the Act. If so, this fact could have a negative effect upon the value of the property. Since we have no direct evidence relating to this issue, we did not consider possible noncompliance with the requirements of ADA in estimating the value of the property.
·That possession of this report, or a copy of it, does not carry with it the right of publication. It may not be used for any purpose by any person other than the party to whom it is addressed without the written consent of the appraiser, and in any event only with proper written qualification and only in its entirety. ·Testimony or attendance in court by reason of this appraisal is not required unless further authorization to fully appraise the property involved is granted the appraiser at a fee to be determined prior to commencement of such additional work as may be required.
·The liability of principals signing this report is limited to the client only and to the fee actually received by the appraiser. Further, there is no accountability, obligation or liability to any third party. If this report is placed in the hands of anyone other than the client, the client shall make such party aware of all limiting conditions and assumptions of the assignment and related discussion. The appraiser is in no way to be responsible for any costs incurred to discover or correct any deficiencies of any type present in the property, physical, financial, and/or legal. ·The appraiser assumes no responsibility for economic or physical factors that may affect the opinions in this report which occur after the date of the letter transmitting the report. ·Information, estimates and opinions contained in the report, obtained from third-party sources are assumed to be reliable and have not been independently verified.
·The appraiser reserves the right to make such adjustments to the analyses, opinions and conclusions set forth in this report as may be required by consideration of additional data or more reliable data that may become available. ·Any income and expense estimates contained in the appraisal report are used only for the purpose of estimating value and do not constitute predictions of future operating results. ·The property is appraised assuming it to be under responsible ownership and competent management, and available for its highest and best use.
·If no title policy was made available to the appraiser, we assume no responsibility for such items of record not disclosed by customary investigation. No opinion as to title is rendered. Data related to ownership and legal description was obtained from Assessor’s records and is considered reliable. Title is assumed to be marketable and free and clear of all liens, encumbrances, easements and restrictions except those specifically discussed in the report. ·The appraiser assumes no responsibility for hidden or unapparent conditions of the property, subsoil, or structures that render it more or less valuable. No responsibility is assumed for arranging for engineering studies that may be required to discover them.
·The property is appraised assuming it to be in full compliance with all applicable federal, state, and local environmental regulations and laws, unless otherwise stated. ·The property is appraised assuming that all required licenses, certificates of occupancy, consents or other legislative or administrative authority from any local, state or national government or private entity or organization have been, can be obtained or renewed for any use on which the value estimate contained in this report is based, unless otherwise stated.
·No engineering survey has been made by the appraiser. Except as specifically stated, data relative to size and area were taken from sources considered reliable and no encroachment or real property improvements is considered to exist.
T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 ·No opinion is expressed as to the value of subsurface oil, gas or mineral rights or whether the property is subject to surface entry for the exploration or removal of such materials except as is expressly stated. ·Maps, plats and exhibits included in this report are for illustration only as an aid in visualizing matters discussed within the report. They should not be considered as surveys or relied upon for any other purpose, nor should they be removed from, reproduced, or used apart from the report. ·No opinion is intended to be expressed for matters that require legal expertise or specialized investigation or knowledge beyond that customarily employed by real estate appraisers. ·The distribution, in any, of the total valuation in this report between land and improvements applies only under the stated program of utilization. The separate allocations for land and buildings must not be used in conjunction with any other appraisal and are invalid if so used.
·No detailed soil studies covering the subject property were available to the appraiser. Therefore, any premises as to soil qualities employed in this report are not conclusive but have been discussed with the client and considered consistent with information available to the appraiser. ·Since earthquakes are not uncommon in the area, no responsibility is assumed due to their possible effect on individual properties, nor for assessing the reliability of the seismic qualifications of structures on the subject properties.
·No consideration has been given in this appraisal as to the value of the property located on the premises considered by the appraiser to be personal property, nor has he given consideration to the cost of moving or relocating such personal property; only the real property has been considered. ·Unless otherwise stated in this report, the existence of hazardous material, which may or may not be present on the property, was not observed by the appraiser. The appraiser has no knowledge of the existence of such materials on or in the property. The appraiser, however, is not qualified to detect such substances. The presence of substances such as asbestos, urea-formaldehyde foam insulation, or other potentially hazardous materials may affect the value of the property. The value estimate is predicated on the assumption that there is no such material on or in the property that would cause a loss in value. No responsibility is assumed for any such conditions, or for any expertise or engineering knowledge required to discover them. The client is urged to retain an expert in this field, if desired. ·The appraiser has personally inspected the subject property and finds no obvious evidence of structural deficiencies, except as stated in this report; however, no responsibility for hidden defects or conformity to specific governmental requirements, such as fire, building and safety, earthquake or occupancy codes can be assumed without provision of specific professional or governmental inspections.
·No termite inspection report was available. It is assumed there is no significant termite damage or infestation unless otherwise stated.
·Lease, rental or expense data related to the report being appraised provided by the property owners or responsible parties are assumed to be accurate.
·The conclusions of this report are estimates based on known current trends and reasonably foreseeable future occurrences. These estimates are based partly on property information, data obtained in public records, interviews, existing trends, buyer-seller decision criteria in the current market, and research conducted by third parties, and such data are not always completely reliable. We are not responsible for these and other future occurrences that could not have reasonably been foreseen on the effective date of this assignment. Furthermore, it is inevitable that some assumptions will not materialize and that unanticipated events may occur that will likely affect actual performance.
While we are of the opinion that our findings are reasonable based on current market conditions, we do not represent that these estimates will actually be achieved, as they are subject to considerable risk and uncertainty. Moreover, we assume competent and effective management and marketing for the duration of the projected holding period of this property.
·All prospective value estimates presented in this report are estimates and forecasts which are prospective in nature and are subject to considerable risk and uncertainty. In addition to the contingencies noted in the preceding paragraph, several events may occur that could substantially alter the outcome of our estimates such as, but not limited to changes in the economy, interest rates, and capitalization rates, behavior of consumers, investors and lenders, fire and other physical destruction, changes in title or conveyances of easements and deed restrictions, etc.
It is assumed that conditions reasonably foreseeable at the present time are consistent or similar with the future. ·Unless the time frame is shorter under applicable law, any legal action or claim relating to the appraisal or Appraiser's services shall be tiled in court (or in the applicable arbitration tribunal, if the parties to the dispute have executed an arbitration agreement) within two (2) years from the date of delivery to Client of the appraisal report to which the claims or causes of action relate or, in the case of acts or conduct after delivery of the report, two (2) years from the date of the alleged acts or conduct. The time frame stated in this section shall not be extended by any delay in the discovery or accrual of the underlying claims, causes of action or damages. The time frame stated in this section shall apply to all noncriminal claims or causes of action of any type. ·Any use of or reliance on the appraisal by any party, regardless of whether the use or reliance is authorized or known ents, limiting conditions and
by Appraiser, constitutes acceptance of, and is subject to, all appraisal statem assumptions stated in the appraisal report.
T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700 ·The appraisal performed under this Agreement will be subject to all statements, assumptions, limiting conditions and other conditions (collectively, "Appraisal Conditions") set forth in the appraisal report. Client agrees that Client will review the Appraisal Conditions upon receipt of the report and that Client's use of the appraisal will constitute acceptance of the Appraisal Conditions. The Appraisal Conditions shall be considered as being incorporated into and forming part of this Agreement with respect to the appraisal in which they re contained and to the services relating to that appraisal.
·Legal claims orcauses of action relating to the appraisal are not transferable or assignable to a third party, except:
(I) as the result of a merger, consolidation, sale or purchase of a legal entity, (ii) with regard to the collection of a bona fide existing debt for services but then only to the extent of the total compensation for the appraisal plus reasonable interest, or (iii) in the case of an appraisal performed in connection with the origination of a mortgage loan, as part of the transfer or sale of the mortgage before an event of default on the mortgage or note or its legal equivalent.
T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700
ADDENDA SECTION
SUBJECT PHOTOGRAPHS
LEGAL DESCRIPTION
GROUND LEASE
QUALIFICATIONS
T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700
SUBJECT PHOTOGRAPHS
5811 LIVE OAK STREET
BELL GARDENS, CALIFORNIA
View of subject. View of subject
View southerly of subject View northeasterly of subject West on Live Oak East on Live Oak
5811 LIVE OAK STREET
BELL GARDENS, CALIFORNIA
5811 LIVE OAK STREET
BELL GARDENS, CALIFORNIA
T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700
LEGAL DESCRIPTION
T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700
GROUND LEASE
T IERRA W EST A DVISORS-5811L IVE O AK S TREET F ILE N O.23-1700
QUALIFICATIONS
QUALIFICATIONS OF JEFFREY T. NAGASAKI, MAI
EXPERIENCE
Nagasaki & Associates, 2005 to present; Principal responsible for providing a broad variety of real estate consultation and valuation services for the public and private sectors. Property rights appraised include fee simple, leased fee, and leasehold interest. Services include traditional market value studies, market rent studies, historic valuation studies, value diminution analysis, partial interests for estate planning and family limited partnerships. Assignments deal with all major property types including commercial retail and office, hotel, industrial, marina, multiple residential, acreage, residential subdivisions, and special purpose properties.
He is qualified as an approved appraiser for the U.S. Department of Housing and Urban Development. Mr.
Nagasaki’s experience includes over 45 years of appraisal experience, fully competent and qualified to complete most assignments under the requirements of the competency provisions of USPAP.
Lea Associates, Inc., 1985 - 2005; Principal and Senior Vice President responsible for providing real estate appraisal and consultation services. Property types included retail, office, industrial, creative office, residential income, vacant land, and hotels. Property rights appraised include fee simple, leased fee, and leasehold interest.
Security Pacific National Bank, 1978 - 1985; Assistant Vice President with responsibility for valuation of real property, proposed and existing, including retail, office, industrial, residential income units, vacant land, special purpose properties, single-family residences, condominiums, and residential subdivisions.
EDUCATION
Continuous participation in numerous seminars relating to real estate appraisal theory and practice. A sample of these seminars include:
Limited Appraisals and Reporting OptionsCase Study in Limited Partnership Valuation Environmental Risk and the Real Estate ProcessAffordable Housing Projects Litigation SeminarMarketability discounts for real estate interests Partial AcquisitionPartial interests theory and case law Easement ValuationPublic Interest Value program
Shopping Centers AnalysisValuation of Leases, Leasehold & Leased fees Impact of Detrimental ConditionsGoing Concern Value and Real Property National IRS Symposium on ValuationSpecial Purpose Properties Appraising Family Limited PartnershipsMarket Trends
Successful completion of the following Appraisal Institute's courses and examinations:
Highest and Best Use AnalysisCase Studies in Real Estate Valuation Standards of Professional PracticeCapitalization Theory and Techniques, Part A Comprehensive Examination Capitalization Theory and Techniques, Part B Demonstration Appraisal Report Valuation Analysis and Report Writing Basic Valuation ProceduresReal Estate Appraisal Principles Residential Valuation Appraisal Curriculum Overview
California State University, Long Beach, Bachelor of Science degree in Business Administration specializing in Real Estate Finance and Financial Management, May 1978.
QUALIFICATIONS OF JEFFREY T. NAGASAKI, MAI (Cont’d)
EXPERT TESTIMONY
Mr. Nagasaki has qualified as an expert witness in real estate matters and has testified before:
Los Angeles County Superior Court Riverside County Superior Court San Bernardino County Superior CourtOrange County Superior Court Further, he has appeared in binding and non-binding arbitration hearings as an expert witness in real estate valuation.
ASSOCIATIONS
Member of the Appraisal Institute, with an MAI Designation Certified General Real Estate Appraiser - AG003078, State of California Institute of Real Estate Management (IREM) - Associate Member
5811 ½ LIVE OAK STREET
BELL GARDENS, CALIFORNIA
T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A
EXECUTIVE SUMMARY
Subject Property:
Location:5811 ½ Live Oak Street
Bell Gardens, California
Assessor's Parcel No.:6227-004-900
Site Area:1,050 sf (per calculations provided by the City) Zone:C-4, Heavy Commercial
Flood Hazard:Zone X, minimal flood hazard
Census Tract No.:6041.00
Present Use:Cellular equipment site
Improvement Description:Paving, iron wrought fencing and equipment building.
Highest and Best Use:Assemblage
Date of Value:July 10, 2023
Interest Appraised:Underlying fee simple
Final Value Estimate:$20,000
T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A
TABLE OF CONTENTS
Page
Letter of Transmittal............................................................
Aerial........................................................................
Executive Summary.............................................................
Table of Contents...............................................................
CLIENT........................................................................1 INTENDED USERS...............................................................1 INTENDED USE.................................................................1 EXTRAORDINARY ASSUMPTIONS................................................1 HYPOTHETICAL CONDITIONS....................................................1 EFFECTIVE DATE OF VALUE OPINION............................................1 DATE OF REPORT...............................................................1 PURPOSE OF THE ASSIGNMENT..................................................1 SCOPE OF WORK................................................................1 REPORT OPTION................................................................2 DEFINITIONS...................................................................2 PROPERTY RIGHTS APPRAISED..................................................3 EXPOSURE AND MARKETING TIME...............................................3 SUMMARY DESCRIPTION OF THE REAL ESTATE APPRAISED.......................3 Market Area...............................................................3 Market Overview...........................................................7 Site Map..................................................................9 Ownership History..........................................................9 Location..................................................................9 Legal Description...........................................................9 Land....................................................................10 Zone....................................................................10 Improvements............................................................10 Occupancy...............................................................11 Highest and Best Use - As Vacant.............................................11 VALUATION...................................................................15 Sales Comparison Approach - Remnant and Small Lot Sales Value Analysis...........15 Sales Comparison Approach - Assemblage Valuation Analysis......................18 RECONCILIATION AND FINAL VALUE ESTIMATE.................................22 CERTIFICATION AND RESTRICTION UPON DISCLOSURE AND USE.................23 ASSUMPTIONS, CONTINGENT AND LIMITING CONDITIONS........................24
ADDENDA
Subject Photographs.................................................................
Legal Description...................................................................
Qualifications
Jeffrey T. Nagasaki, MAI......................................................
T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A CLIENT
Tierra West Advisors, Inc. and City of Bell Gardens
INTENDED USERS
The client and others as appropriate.
INTENDED USE
It is the intended use of this appraisal to provide the client with an estimate of the market value of the subject for use in the client’s possible disposition and sale.
EXTRAORDINARY ASSUMPTIONS
None.
HYPOTHETICAL CONDITIONS
None
EFFECTIVE DATE OF VALUE OPINION
The date of value used in this report is July 10, 2023.
DATE OF REPORT
This report is dated July 12, 2023, generally corresponding to the completion of our current investigations, analyses of relevant data, and completion of this report document.
PURPOSE OF THE ASSIGNMENT
The purpose of this appraisal report is to provide our opinion of the market value of the underlying fee simple interest of the subject property, as land only, for the transfer of this remnant site from the Successor Agency to the City of Bell Gardens.
SCOPE OF WORK
We determined the scope of work necessary to meet the requirements of a comprehensive appraisal analysis.
We confirmed the zoning of the subject property with the City of Bell Gardens, reviewed property ownership, and reviewed Assessor’s maps. We completed a field inspection of the subject property, reviewed the subject and adjoining sites, took photographs and noting the characteristics of the property that are relevant to its valuation. The appraisal problem did warrant a highest and best use study. Given the nature of the subject real estate, our conclusion of highest and best use was based on logic and observed evidence. This involved a review of the value as vacant land in a determination of the highest and best use of the property. We reviewed the potential uses available to the subject property consistent with its shape and size, as well as underlying zoning and general plan designation. After careful study, we concluded that the highest and best use of the subject property was assemblage with the adjoining the site to the north and west of the subject.
We are analyzing the underlying fee simple interest of the subject site and only the Sales Comparison Approach was considered a reasonable valuation measure in the context of the subject site. We completed two studies to determine the market value of this remnant site. The first approach was to consider remnant lots purchased in the open market for various purposes, but each having the same limited utility and size that essentially precluded independent development. We located transactions over a broadened time frame and 1 T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A geographic area due to the limited number of sale transactions. We studied sales transactions considering the size, topography, location and topography of the subject. We compared and contrasted the features of the comparable sales with the subject. In this investigation of market data we utilized the Multiple Listing Service, Loopnet, and CoStar Comps, Inc. This provided us a direct methodology of the Sales Comparison Approach, to determine the market value of the subject site.
As a second method we considered the site “as assembled” with the adjoining property to determine the value of the entire site combined. This considered the zoning and utility of the adjoining site to the north and improved with an office building. The site is fully suited for development without the subject. We studied sales transactions of commercial land in the subject location, considering the size, topography, location and zone of the subject. We arrived at a concluded unit rate for the entire site on a price psf of site area. We then applied the pro-rata unit rate and considered the impact of the limited marketability of the site to the open market of alternative buyers and sellers, as required by the definition of market value. We discounted the pro- rata unit rate to arrive at the market value of the subject site, available to the broader market of potential buyers and sellers, inclusive of the adjoining property owner, but not exclusively to that potential buyer.
Our investigations included research of public records through the use of commercial sources of data such as comparable data services and computerized databases. Search parameters such as dates of sales, leases, locations, sizes, types of properties, and distances from the subject started with relatively narrow constraints and, if necessary were expanded until we retrieved data sufficient to estimate market value, or until the we reasonably exhausted the available pool of data. Researched sales data were viewed and efforts were made to verify the data with persons directly involved in the transactions such as buyers, sellers, brokers, or agents.
In addition, we considered any appropriate listings or properties found through observation during the appraiser’s data collection process.
We then completed an appraisal in compliance with the Uniform Standards of Professional Appraisal Practice as promulgated by The Appraisal Foundation and the Code of Professional Ethics and Certification Standard of the Appraisal Institute. The results of our studies are presented in a Summary Appraisal Report, as defined in USPAP, which will include photographs of the subject property, descriptions of the subject neighborhood, the site, any improvements on the site, a description of the zoning, a highest and best use analysis, a summary of the most important sales used in the appraiser’s valuation, a reconciliation and conclusion with maps illustrating the sales in relationship to the subject property and other data deemed by the appraiser to be relevant to the assignment. Pertinent data and analyses not included in the report may be retained in the appraiser’s files. This report is subject to the “Certification and Restrictions Upon Disclosure and Use” and “Contingent and Limiting Conditions upon Which this Appraisal is Made.” In addition, this report is subject to the special conditions outlined in the transmittal letter.
REPORT OPTION
This report is an Appraisal Report in accordance with the reporting requirements set forth under Standards 2-2(a) of the Uniform Standards of Professional Appraisal Practice (USPAP). The Appraisal Report will summarize the details relevant to the valuation and appraisal process. Supporting documentation for this format is contained within our files.
DEFINITIONS
Title 12 of the Code of Federal Regulations Section(s)34.41 and 323.3 define market value as:
The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby:
1)The buyer and seller are both typically motivated;
2 T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A 2)Both parties are well-informed or well-advised, and each acting in what they consider their own best interest;
3)A reasonable time is allowed for exposure in the open market; 4)Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and
5)The price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale.
TheDictionary of Real Estate Appraisal, Sixth Edition, by the Appraisal Institute, defines the following:
The Fee Simple Estate is defined as:
“Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat.” Assemblage is defined as:
“1. The combining of two or more parcels, usually but not necessarily contiguous, into one ownership or use; tile process that may create plottage value; See also plottage value. 2. The combining of separate properties into units, sets, or groups, i.e., integration or combination under unified ownership.”
Plottage is defined as:
“The increment of value that often occurs when two or more sites are combined to produce greater utility, resulting in a higher productivity or income than could be obtained from the individual smaller sites. See also assemblage.”
PROPERTY RIGHTS APPRAISED
The property rights herein appraised consist of the underlying fee simple interest in and to the subject property, excluding mineral rights.
EXPOSURE AND MARKETING TIME
This refers to the estimated length of time the property interest being appraised would have been offered on the market prior to the hypothetical consummation of a sale at a market value on the effective date of the appraisal; a retrospective estimate based on the analysis of past events assuming a competitive market. In the subject’s case, the exposure time was estimated to be six to nine months. We have also analyzed potential marketing time for the subject site as land only. Our marketing time considers the current environment of demand for commercial land properties in the greater Southern California region. In addition this reflects the current environment of higher interest rates and potential for recessionary economic conditions and its impact on sale prices and purchase decision-making. We estimate that the marketing time would be six to nine months, assuming sufficient exposure to the market.
SUMMARY DESCRIPTION OF THE REAL ESTATE APPRAISED
Market Area
The County of Los Angeles contains approximately 4,083 sq. mi. It is bounded on the north by Kern County, on the east by San Bernardino County, on the southeast by Orange County, and on the northwest and west by Ventura County and the Pacific Ocean, respectively. The population estimate developed by the California Department of Finance as of January 1, 2023 was 9,761,210 a nominal 0.7% decrease from 2022.
Forty-five years ago, Los Angeles was the leading farm county in the nation. However, agricultural importance has since waned due to urban and industrial expansion. Today, the county’s varied economic base includes trade, transportation, and utilities, government, educational and health services, professional and 3 T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A business services, and manufacturing. Tourism and entertainment, as well as international trade, also play a vital role in the county’s economy. Employment statistics have continued to show declining unemployment rates, after the years of recessionary conditions. Continued improvement of economic conditions are impacting growth and expansions affecting the region, state and nation. The economy has shown strong employment and fundamentals with growth projected at a positive pace, better than that of the state and other parts of the region.
According to the California Department of Finance June 2023 Monthly Newly released global financial data confirms that California remained the fifth largest economy in the world in 2022 for the sixth consecutive year. The state's Gross Domestic Product (GDP) grew by $225 billion to total nearly $3.6 trillion in current dollar terms, ranking ahead of India and behind Germany.
Year-over-year U.S. headline inflation slowed for the eleventh straight month to 4% in May 2023, down from
4.9% in April. The Core Consumer Price Index - which excludes the volatile food and energy categories - declined from 5.5% in April to 5.3% in May. Shelter inflation, which measures rents currently paid by tenants, fell slightly from 8.1% to 8%. This measure typically changes slower than other components, and the current slowing reflects declines in asking prices in late 2022. California headline inflation, available only for even months, slowed to 4.2% in April.
I NFLATION&L ABOR M ARKET C ONDITIONS
U.S.
·The U.S. unemployment rate rose from 3.4% in April to 3.7% in May as the labor force increased by 130,000 while civilian household employment fell by 310,000, resulting in unemployment increasing by 440,000 persons. The U.S. added 339,000 non-farm payroll 4 T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A jobs in May 2023, a gain of at least 200,000 jobs for twenty-nine months in a row. The March and April estimates were also revised upward by a combined 93,000 jobs. Most major sectors gained jobs, led by private educational and health services (97,000), professional and business services (64,000), and government (56,000).
·California's unemployment rate remained at 4.5% in May 2023 as the labor force increased by 25,000 while civilian household employment rose by 10,000, and the number of unemployed workers increased by 15,000. California added 47,300 nonfarm payroll jobs in May 2023, driven by gains in private education and health services (16,400) and professional and business services (11,700). The construction sector added 6,500 jobs. The largest job loss was in manufacturing (-5,700), followed by information (-2,800) and mining and logging (-100).
B UILDING A CTIVITY &R EAL E STATE
·Year-to-date, California permitted 98,000 units on a seasonally adjusted annualized rate (SAAR) basis in April 2023, up 1% from March 2023 but down 21.4% from April 2022.
April 2023 permits consisted of 47,000 single-family units (up 0.6% from March 2023, and down 35.6% year-over-year) and 51,000 multi-family units (up 1.3% from March 2023 and down 1.2% year-over-year).
·The statewide median price of existing single-family homes increased to $836,110 in May 2023, up 3% from April 2023 and down 6.4% from May 2022. Sales of existing single-family homes in California totaled 289,460 units (SAAR) in May 2023, up 9.8% from April 2023, and down 23.6% from May 2022. Year-to-date through May 2023, sales volume averaged 271,938 units (SAAR), which was 35.1% lower than during the same period in 2022.
The City of Bell Gardens has a rich history dating back to the late 1700's when the area was associated with a large amount of land situated along the lower basin of the Rio Hondo area in Los Angeles County. Bell Gardens was once a bustling agricultural center for immigrants escaping the Mexican government. The land’s original adobe dwelling was built in 1795 and named Casa de Rancho San Antonio by Lugo. When Gage occupied the residence, he added two wings and redwood siding, installed bronze fireplaces, and imported expensive fabric wallpaper from France to serve as background for the Gage coat of arms, which enjoys a place of prominence in every room.
’early history.
Because of the rich soil and abundant land, many Japanese immigrants are part of Bell Gardens Japanese Gardeners leased land and farmed to produce quality vegetables for the marketplace. Rice fields also mushroomed within the city limits of Bell Gardens. With some of the richest agricultural land in the country, Bell Gardens remained a farming community until the 1930's. In 1927 Firestone Tire Company bought some of the land at $7,000 an acre. By 1900, Bell Gardens was divided into tracts of 40 to 100 acres. The land adjoining the city of Bell became known as Bell Gardens. In 1930, O.C. Beck purchased property and begins to build affordable homes for those suffering through the depression era. World War I and World War II brought defense plants to the area that helped build the economic stability and the population, which led to construction of new homes, more schools, and a prosperous business climate. Today, only a 2.4 square mile city, Bell Gardens maintains only a small portion of the original Lugo land grant, which is located at the site of the Casa Mobile home Park on Gage Avenue.
Bell Gardens is a relatively young city. Since its incorporation on August 1, 1961, Bell Gardens has grown from a population of approximately 4,000 to around 47,000. The median age is 27.3 There are six elementary schools, two intermediate schools, one high school and two adult schools. According to the California Department of Finance, the January 1, 2023 population estimate is 38,447 a 0.8% decrease from 2022. There are 9,986 housing units with 24% owner occupied by 76% renter occupied. Median household income was $38,170.
Demographic information for the subject was provided by Environmental Systems Research Institute (ESRI), a leader in geographic information systems (GIS). The demographics analyzed were 2022 estimates by ESRI 5 T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A for the area located within a one, three and five mile ring of the subject property. The following table shows the results for the subject.
2022
1-mile ring3-mile ring5-mile ring
Population36,062330,109859,015
Households7,69589,214228,187
Average Household Size3.883.673.73
Median Age28.531.030.4
Median Household Income$50,458$62,116$60,471
Average Household Income$66,483$84,040$81,459
Per Capita Income$16,923$22,722$21,659
In addition to the resident population, there are 7,245 businesses in a one-mile ring with a employee population of 53,998, providing additional potential customer base. There are 2,329 (4.0%) owner-occupied housing units in a one mile radius with 50,421 (87.7%) renter-occupied housing units. Median home value for 2022 is $616,323 and average home value of $690,523 for the one mile ring. The area provides a modest income level in a predominantly rental housing market surrounding the subject, which also benefits from moderate commercial traffic volume near the subject property.
The subject property is located just north side of Live Oak Street . Live Oak Avenue is developed with the Bell Gardens Village Square shopping center anchored by Marshalls, Ross Dress For Less and Applebee’s restaurant. The Quality Inn hotel, Bell Gardens Intermediate school are also along the north side of the street. 6 T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A Along the south side of the street are smaller multiple residential development. Most of the commercial development is located along Eastern Avenue with extensive retail and commercial development. The Bicycle Hotel and Casino is located on the west side of Eastern Avenue at Florence Avenue. The area is convenient to the transportation linkage of the Long Beach Freeway (Interstate 710) with on- and off-ramps on Florence Avenue.
Market Overview
According to CBRE Marketview Greater Los Angeles Retail Q4-2022 - “2022 finishes strong despite macroeconomic challenges”. While global and national concerns abound regarding the looming financial downturn, many economists are predicting that the potential recession will not be as bad as previously anticipated. Despite increased lending requirements and concerns regarding credit volatility, it is anticipated that interest rates will begin to level throughout 2023, barring further economic shifts as inflation and the labor market begin to coo1. In an attempt to mitigate lowered consumer confidence, retailers will continue to enhance the overall consumer experience. Superior customer service and the integration of technology like "walk-out-purchasing" will be vital to luring consumers back to stores, restaurants, and other retail destinations. Additionally, as consumers continue to purchase more environmentally friendly goods, look for retailers to gravitate towards becoming more ESG-friendly. Demand for 2nd generation and high street retail space remains strongly favored and that will sustain throughout 2023.
RentableOverall VacancyAverage Asking
Sub-MarketArea SFRates %Rates
Antelope Valley 8,136,4306.1%$1.56
Greater Downtown2,658,80712.0%3.49
Mid-Cities12,308,7954.2%2.37
Mid-Wilshire3,661,3145.8%3.14
San Fernando Valley15,014,9786.3%2.78
San Gabriel Valley20,703,4575.4%2.46
Santa Clarita Valley5,905,3235.3%2.54
South Bay20,150,8013.6%2.72
Southeast Los Angeles7,269,3135.0%2.05
Tri-Cities9,204,9626.6%3.32
Ventura22,339,3235.1%2.34
West Los Angeles5,320,16112.6%5.80
Greater Los Angeles Area132,673,6645.6%2.77
th
Source: CB Richard Ellis 4 Quarter 2022
Overview:
·Vacancies in high street retail-corridors declined quarter-over-quarter, while vacancies in B- Class and lower markets saw increases.
·Woodland Hills experienced the largest retail sale across Greater Los Angeles when Kroenke bought The Village for $325 million.
·Measure ULA, which imposes an additional tax on transactions valued at $5 million or greater, was passed in Q4 2022 If a sale is between $5 million and $10 million, the tax rate will be 4.5% and any transactions greater than $10 million will be taxed at 5.5%. Previously on a sale, only the capital gains from the transaction would be taxed. With measure ULA, the tax rate is applied to the entire purchase price.
·Asking rents gradually increased throughout 2022 and are expected to continue that upward trajectory in 2023.
·As costs for ground-up developments continue to rise, look for retail developers and investors to pivot and focus on redesigning existing retail properties to attract more consumers.
7 T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A Los Angeles County's seasonally unadjusted unemployment rate was 4.5% as of December 2022. While this rate stood higher than the CA state rate of 4.0'%, LA County's unemployment has cooled down from 4.9% quarter-over-quarter. The Transportation and Warehouse sector continued to post strong employment numbers at 219,600; a 1.4% increase quarter over quarter and 4,3% increase year-over-year. Although the retail workforce is beginning to level out after experiencing historic highs in both quits and job openings in late 2021 and into 2022, retailers will continue to have their hands full trying to find enough employees to fill their operations. Implications tied to staffing and employee compensation will persist in 2023 as many retailers continue to be short-staffed. The incorporation of technology to repeatable or simplified tasks, will prove valuable amidst a lack of qualified employees and high costs associated with hiring. Greater Los Angeles's average asking lease rate finished $2.77 in Q4-2022, experiencing no change quarter-over-quarter but increasing $0.02 year-over-year. Despite macroeconomic headwinds in 2022, Greater Los Angeles's asking rate remained steady throughout the year. never dipping below $2.73.
Total leasing activity declined 13% quarter-over-quarter, finishing at 21M total sq. ft. leased in Q4- 2022.
Although Greater Los Angeles posted 57,762 sq. ft. of negative absorption in Q4, several submarkets finished out the year on a high note. Mid-Cities and the San Gabriel Valley had the strongest quarters. recording 44,084 sq. ft. and 34,704 sq. ft of positive net absorption, respectively.
There were no construction deliveries reported in Q4 2022. 400,000 sq. ft. is currently under construction at Del Amo Blvd - Phase 1, in Torrance and is set to deliver in December of 2024. Hollywood Park is the largest retail project that is currently under construction in GLA. The 300-acre development next to SoFi Stadium is set to encompass 890,000 sq. ft. of retail space. This substantial retail development is 65% leased or under negotiations, and will be home to a vast range of tenants. Large tenants like Cinepolis and smaller tenants like Red Bay Coffee will be able to take full advantage of the foot traffic that spills over from the stadium, offices, and residential properties that are all within walking distance.
Concerns surrounding inflation and labor markets are some of the chief concerns for the Federal Reserve heading into the new year. This exposes the market to interest rate risk as previous low yield bonds will be devalued by higher yield bonds in the open market. This could cause instability in sectors and portfolios who have a higher exposure to debt securities in the near term. In addition to risk. this has materially affected the world of real estate capital markets with investment volume deceleration as debt has become more selective.
If trends continue, cap rate will decompress along with property pricing adjustments to attract more equity based cash buyers.
Total sales volume reached its lowest level over the span of the past five consecutive quarters, but remained higher than the historical average. Class A retail sales volume saw a 74% decrease quarter-over-quarter, while Class B property sales experienced a 25% decline quarter-over-quarter. The most active markets measured by total sq. ft. transacted includes the San Fernando Valley, East Los Angeles, and the South Bay.
TH
OUTHEAST LOS A NGELES R ETAIL M ARKET 4Q UARTER 2022
S
TotalTotalOverall
No. ofBuildingVacantVacancyLease Rate
MarketBldgs.SFSFRate(SF/Month)
Southeast Los Angeles357,629,313363,1655.00%$2.05
8 T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A Site Map
Ownership History
The subject property currently shows title held by:
City of Bell Gardens
We do not have details on the original acquisition of the subject site. The subject was owned by the Bell Gardens Community Development Commission and was transferred to the City of Bell Gardens on August 2, 2011 via Document No. 35684. The City is in process of returning title to the City of Bell Gardens Successor Agency. The subject property is not listed for sale. There have been no market transactions involving the subject property in the last five years.
Location
The subject site is located on the north side of Live Oak Street and has the following address:
5811 ½ Live Oak Street
Bell Gardens, California 90201
Legal Description
The complete legal description is contained in the legal description located in the Addenda. 9 T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A Land
Shape:Rectangular;
Dimensions:20 ft. x 52.50 ft.
Area:1,050 sf (per the City)
Topography:Level at street grade.
Soils and Drainage Conditions:No soil report has been made available, but a visual inspection of the subject and surrounding properties and developments revealed no other adverse conditions. Our conclusions are subject to revision pending receipt of a soil report.
Hazardous Substances:We have not reviewed a site assessment for the subject property.
There does not appear to be any obvious negative environmental issues that might impact the marketability and/or the value of the subject property. Our appraisal report is subject to review of the environmental assessment report and the following of any clean-up recommendations contained in that report.
Zone
The subject site is zoned C-4, Heavy Commercial for the city Bell Gardens. The C-4 zone was established to provide for regional commercial needs. This zone provides for intensive commercial activities and specialized service establishments that require a central location within a large urban population. It also permits the development of wholesale businesses and major financial and administrative centers that may serve an entire region. It permits a broad variety of retail, office and commercial uses including those permitted under the C-3 zoning. The zoning does not permit residential uses. Minimum lot size is 15,000 sf maximum FAR of 5.0 and 90% lot coverage. Parking requirements are generally one space per 250 sf for retail uses, one space per 300 sf for offices, one space per 200 sf for medical offices, one space per 21 sf of seating area or for every three fixed seats, plus one space for each two employees for restaurants.
Assessor's Parcel No.: None
Assessed Value:
Land: None
Improvements:None
Total:None
Actual Taxes:As publically owned land the subject is exempt In accordance with Proposition 13, the subject would be reassessed under sale or other subsequent transfer to a private ownership.
We have reviewed a title report for the adjoining subject parcel. Visual inspection of the subject property revealed no apparent conditions that would negatively impact property value. All of the usual and necessary public utilities are available to the subject property.
The subject property enjoys full pedestrian and vehicular access to Live Oak Street, a local east/west right of way dedicated to a width of 50 feet, with one lane in each direction. Parallel parking is permitted along both sides of the street in front of the subject. The right of way has asphalt paved surface, and includes concrete curbs, gutters and partial sidewalks.
Improvements
The subject property has asphalt paving, iron wrought fencing, and equipment structure with cellular tower. 10 T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A Occupancy
The subject site is currently under ground lease to New Cingular Wireless PCS, LLC which began July 23, 1991 for an initial ten year term with (2) five year options to extend. The original lease has been subsequently amended to begin August 1, 2011 for an initial five year term with (5) additional five year terms. According to the terms of the lease the current rent is $4,345.05 per month with an annual lease adjustment of 4% to occur on August 1, 2023. The projected rent on that date will be $4,518.85. The tenant is responsible for all utilities, maintenance and taxes associated with the property. Our analysis does not consider the income stream from this lease and land value reflects only the underlying fee simple interest of the site.
Highest and Best Use - As Vacant
Highest and Best Use as defined by The Appraisal of Real Estate, 14th Ed., Appraisal Institute: Chicago, Illinois, is:
"The reasonably probable and legal use of vacant land or improved property, which is physically possible, appropriately supported, financially feasible, and that results in the highest value. The four criteria the highest and best use must meet are legal permissibility, physical possibility, financial feasibility, and maximum productivity. Alternatively, the probable use of land or improved property -specific with respect to the user and timing of use-that is adequately supported and results in the highest present value"
Our analysis of Highest and Best Use includes two studies: Highest and Best Use of land as if vacant, and Highest and Best Use of property as improved. The highest and best use of both land as if vacant and property as improved must meet four criteria. The highest and best use must be legally permissible, physically possible, financially feasible, and maximally productive.
Legally Permissible:Under the present C-4 zone, uses are primarily limited to commercial uses but does not allow residential development. It is clear that the overall location and development trends would suggest that a retail project would be consistent with the current land use in the area, as well as the existing zoning. There are limitations on setback and size which would impact use and independent development s.
Physically Possible:The subject is a narrow site with a total of 1,050 sf, level at street grade. The size does not meet the base standard for development.
Therefore as a single site it requires assemblage with any adjoining site to provide an adequate base for development consistent with the legally permissible uses.
Financially Feasible:Those improvement programs that would produce a positive return on the investment required to construct them. Rent levels and sale prices for retail properties had been increasing over the last several years, but due to rising interest rates and potential for economic recession, this trend has slowed. A review of current construction costs plus land when compared with the sale prices for newer developments indicates that these new developments have been feasible in recent market, however the rising interest rates has made the availability for funds for financing new projects limited. This is supported by the recent slowing trend of new development and construction which is occurring in the general region. Any use or development of the subject site would require some assemblage to provide an adequate base for development and adequate area for construction. The independent development of 11 T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A the subject is not achievable, the only financially feasible use of the subject would be assemblage with the adjoining site consistent with its physically possible uses.
Maximally Productive:The maximally productive use is that which results in the highest return to the subject property. Economic factors are not fully conducive to development. Therefore, we conclude the maximally productive use for the subject site, as vacant, is assemblage with the adjoining site.
Assemblage with the adjoining lot to the north and west appears feasible and does provide a significant benefit for access parking and utility. Thus, assemblage with this site appears viable and the highest and best use of the subject site.
12 13
MARKET DATA MAP - SMALL AND REMNANT LOT SALES
T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A
SMALL AND REMNANT LOT LAND SALES
SOUTHERN CALIFORNIA
SALE PRICE
SaleSite
Psf
Zone
No.LocationDateArea
TotalLandComment
18059 Maple Street10/052,025R1$15,000$7.41Purchase of independent site; Bellflowernot by adjoining property
owner.
2Mermac Street3/061,934C260,00031.02Alley access only.
San Pedro
3a13327 Telegraph Road3/062,247C1 14,500 6.45Purchase as speculation; Whittier
3b10/06 35,000 15.58Purchase by adjoining property
owner for assemblage
4NWC Clarkdale & Aclare3/074,029RS-650057,00014.15Assemblage by adjoining Cerritosproperty owner
5NS of Ellis Avenue8/072,800OS-PR50,00017.86Purchase as speculative lot; Huntington Beachsold by NRRL
6NS of Gardenglen Street3/082,415R14,9002.03Purchase by adjoining property West Covinaowner
th
Street5/082,500R50,00020.00Purchase as assemblage by a
7204 10
Seal Beachbuyer of the adjoining site for
residential development
8SS of Spring Street9/082,750SP438,75014.09Assemblage purchase by the Long BeachSignal Hill RDA
9SS of Spring Street9/082,750SP438,75014.09Assemblage purchase by the Long BeachSignal Hill RDA
10NS of Maple St/Michigan2/152,588RM-4818,0006.96Triangular site with full street Pasadenafrontage
113814 St Andrews Place5/201,216R226,50021.79Walk street; purchased by Los Angelesadjoining property owner.
123807 St. Andrews Place10/201,111R130,00027.02Walk street; Los Angeles
134649 Ivy Street10/20610SF5,0008.20Triangular site purchased by Pico Riveraadjoining property owner
148001 N. Bonfield Avenue9/221,146R121,00014.83Purchased by adjoining North Hollywoodproperty owner for assemblage
14 T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A
VALUATION
Our assignment involves the valuation of the 1,050 sf subject site with commercial zoning and a highest in best use as an assemblage site with adjoining improved commercial property. Only the Sales Comparison Approach was considered a reasonable valuation measure in the context of the subject site. We have utilized two methodologies in order to analyze and determine the market value of the subject site. Initially, we analyzed the valuation of the subject site as a remnant parcel to be acquired for the use in a passive manner absent ultimate development. We have collected and obtained remnant parcel acquisitions of sites which ultimately could not be developed. The variety of transactions across Southern California provided us a base of potential values for the subject property. In the second methodology, we have analyzed the subject property as vacant commercial land, assembled with the site at 5800-5810 Florence Avenue creating a 288,672 sf (6.627 acre) site. In this study, we considered commercial land sales comparing and contrasting them with the assembled site. We then considered that the unit rate assumes the site would be suitable for development as a larger single parcel. There is one other adjacent ownership which might consider assemblage, but as a public school site, there are no benefits afforded by the small site area. It is therefore clear that the limits of the site’s development are restricted and thus we must discount its value to reflect this lack of independent marketability. We considered an appropriate discount for the subject. This approach provides another methodology to consider the valuation of the subject property. Ultimately, we considered each of these approaches in our analysis and determination of market value.
Sales Comparison Approach - Remnant and Small Lot Sales Value Analysis The market for vacant land sales within the subject’s vicinity was surveyed to obtain sale information for our use in estimating the market value of the subject property at reversion. In our search, we considered sales of smaller sites, which may or may not allow use or development, that are relevant in size to the subject. We initially focused on sales of smaller sites located within the Bell Gardens area. However, with the limited set of initial sales, we expanded our search both by sale data and geographic range to include sales from 2005 to the present in the Los Angeles and Orange County areas. From the initial body of data, we narrowed our search to those sites with similar physical characteristics of the subject.
Our data search for sales of comparable properties extended from January 2005 to the present. The data items are summarized on the following table and are displayed geographically on the market data map. The sources of market data include records of the Los Angeles and Orange County Assessor’s compiled by First American Real Estate Solutions LLC, Comps, Inc., the Multiple Listing Service, and interviews with knowledgeable local brokers who specialize in the marketing land in the area.
We therefore considered it necessary to determine the impact on land sale prices across the region since 2005 to provide a foundational basis for any relevant adjustment for market conditions. We included a study of the trend in Los Angeles and Orange county land prices since 2010 for sites in between one-quarter and five acres in size. The information was obtained from CoStar Trend Report and shown on the following graphic page. The past thirteen years have been subject to fluctuation but has shown a steady increase of prices and demand for land with the improving economy, affordable interest rates, and general improvement in economic indicators. This comes after the recession of 2008 and 2009 during the last financial crisis. As a result the demand and prices paid for land has been moving upward with the increases in the numbers of transactions and prices paid. There has been a slowing of this trend given the recent increases in the recent increase in financing costs due to the moves by the Federal Reserve to raise the Federal Funds rates in order to stem the dramatic rise of inflation rates. This also may reflect some resistance due potential for recessionary conditions into the near future.
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Dec-13
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Commercial/Industrial Land Sale Prices
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$-
$90 $80 $70 $60 $50 $40 $30 $20 $10
$100
Price psf
T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A In comparing these transactions to the subject property, we consider the time of sale, conditions of sale, general location, site size, and development potential. Land sales of the size and character of the subject are priced on a total sale price and price psf basis. Factors of comparison were considered in this analysis include general location, including surrounding properties, comparable development, density, and general improvements.
Item No. 1 is the sale of a site purchased by a nearby property owner for use as a garden. Site size is too small for independent development and R1 zoning provides no attributable benefits for added assemblage or development. Location is similar. Date of sale is inferior. Larger site size is inferior on a price psf basis.
Overall, we would expect the subject to sell for a greater rate to this item.
Item No. 2 is a site located on Mermac Street in San Pedro. This is a small alley type street and is a C2 zoned lot. The site is too small for independent development and was purchased by a user for lot storage. The site remains an open lot, is similar in C2 zoning and ultimately could be developed with some commercial development. Date of sale is inferior and lot size are similar. Overall, we would expect the subject to sell for a lesser rate than this item.
Item No. 3 is the sale of a commercial lot that was designated as excess by a local water company. The buyers were speculators interested in “flipping” the property to another property owner. The lot is inferior in location due to alley access only. Date of sale is inferior. Location is slightly inferior. The conditions of sale were considered inferior and below market. They subsequently sold the site in Item No. 3b to the adjoining property owner at a sizable increase. Overall we would expect the subject to sell for a rate higher than the initial purchase but in line with the more recent of the purchase.
Item No. 4 is the sale of a site on Clarkdale Avenue in Cerritos. Date of sale is slightly superior. Larger site size is superior. The property is zoned single family residential use but it is too small for independent development. The site is located adjacent to a church facility and a vacant development site. The property was purchased by the adjoining developers of the vacant site. The property, given its size and characteristics provides no significant contribution to the assemblage value of the larger adjoining site. It was offered on the open market for $62,500 but no other buyers considered purchasing the property. Lack of build ability was a significant factor although it enjoys corner exposure and two street frontage. Overall, we would expect the subject to sell for a greater rate.
Item No. 5 is the sale of an “encyclopedia lot” in Huntington Beach. Date of sale is inferior. The site was purchased from a firm that sells sites for speculative use by marketing them to distant and foreign buyers. The owners continue to pay property taxes and apparently have not defaulted on the property. This transaction is indicative of the sale of speculative lots to unsophisticated buyers as potential investment lots. We did not give much weight to this sale but recognize that the transaction due to its location.
Item No. 6 is the sale of a small remnant parcel which is R1 zoned and located in West Covina. The site is too small to be developed into an independent site and was offered to the open market. The buyer was the adjoining property owner who essentially utilizes it as open space. It provides no additional contribution for density, as the single family zone regulations limits development to the combined site of only one residence.
Date of sale is inferior. Overall the size and characteristics of the site, we would consider the subject to sell for a greater rate than this item.
Item No. 7 is the sale of small residential lot that is not buildable, but was purchased in a transaction involving the adjoining larger site. The lots in this Seal Beach area are often similar in size to this item and developable under most conditions. The assemblage benefits, zoning and development potential are superior.
The date of sale and site size are similar. Overall we would expect the subject to sell for a slightly lesser rate than this item.
Item Nos. 8 and 9 are the sale of two smaller sites in Signal Hill. The sites were purchased from separate sellers and were assembled by the city for the development of an auto dealership site. Both sites were single 17 T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A sites which are not precluded from development, but certainly so small that any use or development is limited.
The sites are impacted by oil well production. The sites were purchased by the Signal Hill Redevelopment Agency at market value without threat of eminent domain. The sites were purchased for assemblage benefits which is superior. Date of sale is slightly inferior. Overall, we would expect the subject to sell for a similar to greater rate than these items.
Item No. 10 is a small triangular site with full street frontage in Pasadena. The date of sale is inferior. The site area is similar, but zoning is superior. Location is similar. Overall inferior to the subject.
Item No. 11 is smaller residential site on St. Andrews Place in Los Angeles. The date of sale is similar to slightly inferior. The site is limited in development due to walk street frontage. The site was purchased by an adjoining property owner to expand their rear yard. Location is inferior. Assemblage benefits is superior.
Overall similar to slightly superior.
Item No. 12 is another lot like Item No. 11. However this site was purchased by a nearby property owner for possible development. The date of sale is slightly inferior. Location is slightly inferior. Overall similar.
Item No. 13 is smaller triangular site purchased by the adjoining property owner for use as landscaping front yard. Date of sale is similar to slightly inferior. Smaller lot area is inferior. Assemblage benefits are superior.
Location is slightly inferior. Overall inferior to the subject.
Item No. 14is a triangular shaped site on Bonfield Avenue in North Hollywood. The date of sale is similar.
The site was purchased by the adjoining homeowner for use in expanding his yard. Location is similar. The assemblage benefits are superior. Overall similar.
Based on this set of data we would conclude with a value of the subject at $18.00 psf of site area.
This equates to the following:
1,050 sf x $18.00 psf=$18,900
Rounded:$19,000
Sales Comparison Approach - Assemblage Valuation Analysis This methodology incorporates the valuation of subject property as assemblage with the adjoining Bell Gardens Village Square shopping center parking lot. In the scope of work, we included the adjoining commercial land site and the subject piece assembled as a single parcel. We utilized the base of data of commercial land sales to determine the value of the site assembled with this parcel.
The market for commercial land in the vicinity of the subject property was surveyed to obtain sale information for our use in estimating the market value of the fee simple interest in and to the combined subject site. We focused on commercial land sales that did not include mixed use or multiple residential development due to the current site zoning. The sources of market data were similar to our earlier study. After the market data was collected, the market data items were then compared to the subject property. The data is shown on the following table and market data map.
In this analysis and in other similar studies, we observed the price per square foot to be the most consistent pricing parameter. Accordingly, our comparative analyses between the sale items has been conducted with the primary emphasis on price per square foot of site area. Elements of comparison included location (surroundings), mid-block or corner exposure, accessibility), size, zoning, topography and site shape. As a reminder, this study considers the combined assemblage of the subject site with the site at 5800-5810 Florence Avenue creating a combined 288,672 sf (6.627 acre) site, with corner exposure and traffic counts of 57,503 ADT (average daily traffic) along Florence Avenue and 23,526 ADT along Eastern Avenue. 18 19
MARKET DATA MAP - COMMERCIAL LAND SALES
T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A
COMMERCIAL LAND SALES
SaleSite Area SFSale Price
No.LocationDateZoneArea AcreTotalPsf
112692 Garden Grove BoulevardOct-21HCSP45,302
$3,100,000$68.43
Garden Grove1.04
7,500,00080.46
218715 S. Western AvenueOct-21C293,218
Torrance2.14
3,100,00056.83
36801 Atlantic AvenueJun-22C354,550
Bell1.25
415101 Paramount BoulevardApr-23PD-PS142,8778,600,00060.19 Paramount3.28
5521 E. 29th StreetMay-23SP-1-M240,01616,817,50070.07
Long Beach5.51
Item No. 1 is a commercial site in Garden Grove planned for a medical office complex. Date of sale is only slightly inferior. Location and exposure are similar. Site shape and topography are similar. Smaller site size superior on a price psf basis. Overall similar on a price psf basis.
Item No. 2 is the sale of a commercial site on Western Avenue in Gardena. Date of sale is slightly inferior.
Location is similar in location but commercial exposure is slightly superior adjoining the San Diego Freeway (Interstate 405). The site is presently used as car storage for a nearby car dealership. Smaller site is superior on a price psf basis. Overall, we would expect the subject to sell for a lesser rate than this item.
Item No. 3 is the sale of a smaller site located on Atlantic Avenue in Bell. Date of sale is similar. Smaller site size is superior on a price psf basis. Location is slightly inferior in traffic exposure and commercial development. The mid-block location is inferior. Site shape and topography are similar. The site is planned for a retail restaurant pad with parking and retail building. Overall, we would expect the subject to sell for a similar to slightly greater rate than this item.
Item No. 4 is the sale of a site on improved with a retail building sold for land value in Paramount. Date of sale is similar. The location is a mixed commercial /industrial area slightly inferior to the subject. The traffic exposure is similar, but site shape is slightly inferior. The site size is slightly superior on a price psf basis.
Overall, we would expect the subject to sell for a greater rate than this item.
Item No. 5 is the large site located on Cherry Avenue in Long Beach Date of sale is similar. The site was purchased by Long Beach Memorial Hospital, adjacent to its campus to prevent separate development. The location is similar and exposure is similar. The corner location, topography, site size and shape are similar.
Overall we would expect the subject to sell for a similar to slightly lesser rate than this item.
Based upon this analysis, we have concluded with a unit rate of $68.00 to $70 psf of land area for the subject.
This is shown as follows:
1,050 sfx$68.00=$71,400
1,050 sfx$70.00=$73,500
Rounded:$72,000
Discount for Limited Marketability
The above unit rate assumes the site would be suitable for development as a single parcel. There is only one adjacent ownership which might consider assemblage. It is therefore clear that the limits of the site’s development are restricted and thus we must discount its value to reflect this lack of independent 20 T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A marketability. In this context, we consider that a 70% discount on the market value of an assembled site would be reasonable.
As support of this we have considered several purchases of sites in Signal Hill. Two sites were purchased from a separate sellers and were assembled by the city for the development of an auto dealership site. Both sites were single sites which are not precluded from development, but certainly so small that any use or development is limited. Item No. 3 is the recent sale of two adjoining sites. The sites are impacted by oil well production. The sites were purchased by the Signal Hill Redevelopment Agency at market value without threat of eminent domain. This provides an indication of the market value of the combined double lot situation similar to the items shown prior to this item. These sites could be considered on a direct comparison study, but also we considered the discount this provided by comparing it with otherwise normal sites in the same market, for a matched pair comparison. The following are the limited size sites that were purchased for assemblage benefits:
SaleSiteSale Price
No.Location DateZoneAreaTotalPsf Land
1SS of Spring Street9/08SP42,750$38,750$14.09
2SS of Spring Street9/08SP42,75038,75014.09
3ES of Rose Avenue11/08GI5,05353,25010.53
We considered the following three industrial land sales in the market to establish a base land value in order to compare to the smaller sites. These are shown as follows:
SaleSiteSale Price
No.Location DateZoneAreaTotalPsf Land
12000 Walnut Ave.2/07M130,056$1,025,000$34.10
2NS of Grant Ave. 1/08M19,000385,00042.78
th
Street2/08M121,031900,00042.79
33251 E. 19
This results in a range of discount between 59% and 75% from the base land value for the assemblage value of a small site. This assisted us in the discounting process and we concluded that the 70% discount is reasonable. Therefore the conclusion reflects a 30% value (100%-70% discount) and using the total value of $72,000 arrived at in our earlier study, results in the following formula:
$72,000 x 30%=$21,600
Rounded$22,000
This equates to a price psf of $20.95 psf of land area which is in the range of the sites shown earlier the Small Remnant Lot Sales Analysis.
21 T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A
RECONCILIATION AND FINAL VALUE ESTIMATE
The underlying land value of the subject property has been analyzed using the two specified methods are shown as follows:
Small Lots Sales Comparison Approach:$19,000
Assemblage Value Analysis:$22,000
We considered two separate methodologies to analyze the subject site. The first analysis provides a direct comparison of remnant sites across a broad geographic area and time frame. This approach is considered relevant because it directly reflects attitudes of buyers and sellers in the marketplace. We have a generous body of data of sales upon which to reflect in valuing the subject. The second approach considered the assembalge of the subject with the adjoining site and discounts the value due to the limited marketability to the variety of potential buyers in the market. It begins with the Sales Comparison Approach, which benefits from a number of larger commercial sales in the subject market area. The concluded unit rate is discounted due to the limited marketability which considers transactions for assemblage sites in Signal Hill area, as well as reasonable consideration of the benefits and utility to the adjoining property owner. There is some economic benefit to the adjoining property owner due to potential increased building area and improved site area, but not on a pro-rated basis of adjoining site, as development of that site has been completed without the subject. However, there should be some value associated with the subject site due to this potential contributory benefit.
We considered both approaches in this study, but gave most weight to the direct comparison study. Therefore we conclude our opinion of the market value of the underlying fee simple interest of the subject site, containing 1,050 square feet, as of the effective date of the appraisal, is:
TWENTY THOUSAND DOLLARS
($20,000)
22 T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A
CERTIFICATION AND RESTRICTION UPON DISCLOSURE AND USE
I certify that, to the best of my knowledge and belief, . . .
The statements of fact contained in this report are true and correct.
The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions, and are my personal, impartial, unbiased professional analyses, opinions, and conclusions.
I have no present or prospective interest in the property that is the subject of this report and no personal interest with respect to the parties involved.
I have no bias with respect to the property that is the subject of this report or to the parties involved in this assignment.
My engagement in this assignment was not contingent upon developing or reporting predetermined results.
My compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal.
I have performed an appraisal of the property that is the subject of this report within the three-year period immediately preceding acceptance of this assignment with the full knowledge of the client.
The reported analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics & Standards of Professional Appraisal Practice of the Appraisal Institute, which include the Uniform Standards of Professional Appraisal Practice.
The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives.
Paul Serragli provided significant professional assistance to the persons signing this letter. His role in this assignment included assisting in the inspection of the subject property, verifying factual data and market data confirmations. The value opinion contained in this report is that of the undersigned.
As of the date of this report, Jeffrey T. Nagasaki, MAI has completed the requirements of the continuing education program of the Appraisal Institute. Further, as of the date of this report Jeffrey T. Nagasaki, MAI (No. AG003078) has satisfied the requirements as Certified General Real Estate Appraisers, licensed by the State of California.
I have personally inspected the property which is the subject of this report. 7/12/2023
CA# AG003078Date
T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A
ASSUMPTIONS, CONTINGENT AND LIMITING CONDITIONS
·This appraisal report and all of the appraiser’s work in connection with the appraisal assignment are subject to the limiting conditions and all other terms stated in the report. Any use of the appraisal by any party, regardless of whether such use is authorized or intended by the appraiser, constitutes acceptance of all such limiting conditions and terms.
·The appraisal report is a summary appraisal which is intended to comply with the reporting requirements set forth by the Uniform Standards of Professional Appraisal Practice (USPAP) promulgated by the Appraisal Standards Board of the Appraisal Foundation. The report is also compliant with Title XI of the Financial Institution Reform, Recovery and Enforcement Act (FIRREA).
·The report is intended for use only by the addressee of this report, its executives or administrative personnel, advisors and attorneys for purposes relating to the assigned described in the Scope of the Appraisal. ·This appraisal has been prepared for the exclusive benefit of the above-named client and stated intended users. It may not be used or relied upon by another party. Any party who uses or relies upon any information in this report without the preparer’s written consent does so at his own risk. ·The Americans with Disabilities Act (“ADA”) became effective January 26, 1992. We have not made a specific compliance survey and analysis of this property to determine whether or not it is in conformity with the various detailed requirements of the ADA. It is possible that a compliance survey of the property, together with a detailed analysis of the requirements of the ADA, could reveal that the property is not in compliance with one or more of the requirements of the Act. If so, this fact could have a negative effect upon the value of the property. Since we have no direct evidence relating to this issue, we did not consider possible noncompliance with the requirements of ADA in estimating the value of the property.
·That possession of this report, or a copy of it, does not carry with it the right of publication. It may not be used for any purpose by any person other than the party to whom it is addressed without the written consent of the appraiser, and in any event only with proper written qualification and only in its entirety. ·Testimony or attendance in court by reason of this appraisal is not required unless further authorization to fully appraise the property involved is granted the appraiser at a fee to be determined prior to commencement of such additional work as may be required.
·The liability of principals signing this report is limited to the client only and to the fee actually received by the appraiser. Further, there is no accountability, obligation or liability to any third party. If this report is placed in the hands of anyone other than the client, the client shall make such party aware of all limiting conditions and assumptions of the assignment and related discussion. The appraiser is in no way to be responsible for any costs incurred to discover or correct any deficiencies of any type present in the property, physical, financial, and/or legal. ·The appraiser assumes no responsibility for economic or physical factors that may affect the opinions in this report which occur after the date of the letter transmitting the report. ·Information, estimates and opinions contained in the report, obtained from third-party sources are assumed to be reliable and have not been independently verified.
·The appraiser reserves the right to make such adjustments to the analyses, opinions and conclusions set forth in this report as may be required by consideration of additional data or more reliable data that may become available. ·Any income and expense estimates contained in the appraisal report are used only for the purpose of estimating value and do not constitute predictions of future operating results. ·The property is appraised assuming it to be under responsible ownership and competent management, and available for its highest and best use.
·If no title policy was made available to the appraiser, we assume no responsibility for such items of record not disclosed by customary investigation. No opinion as to title is rendered. Data related to ownership and legal description was obtained from Assessor’s records and is considered reliable. Title is assumed to be marketable and free and clear of all liens, encumbrances, easements and restrictions except those specifically discussed in the report. ·The appraiser assumes no responsibility for hidden or unapparent conditions of the property, subsoil, or structures that render it more or less valuable. No responsibility is assumed for arranging for engineering studies that may be required to discover them.
·The property is appraised assuming it to be in full compliance with all applicable federal, state, and local environmental regulations and laws, unless otherwise stated. ·The property is appraised assuming that all required licenses, certificates of occupancy, consents or other legislative or administrative authority from any local, state or national government or private entity or organization have been, can be obtained or renewed for any use on which the value estimate contained in this report is based, unless otherwise stated.
·No engineering survey has been made by the appraiser. Except as specifically stated, data relative to size and area were taken from sources considered reliable and no encroachment or real property improvements is considered to exist.
T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A ·No opinion is expressed as to the value of subsurface oil, gas or mineral rights or whether the property is subject to surface entry for the exploration or removal of such materials except as is expressly stated. ·Maps, plats and exhibits included in this report are for illustration only as an aid in visualizing matters discussed within the report. They should not be considered as surveys or relied upon for any other purpose, nor should they be removed from, reproduced, or used apart from the report. ·No opinion is intended to be expressed for matters that require legal expertise or specialized investigation or knowledge beyond that customarily employed by real estate appraisers. ·The distribution, in any, of the total valuation in this report between land and improvements applies only under the stated program of utilization. The separate allocations for land and buildings must not be used in conjunction with any other appraisal and are invalid if so used.
·No detailed soil studies covering the subject property were available to the appraiser. Therefore, any premises as to soil qualities employed in this report are not conclusive but have been discussed with the client and considered consistent with information available to the appraiser. ·Since earthquakes are not uncommon in the area, no responsibility is assumed due to their possible effect on individual properties, nor for assessing the reliability of the seismic qualifications of structures on the subject properties.
·No consideration has been given in this appraisal as to the value of the property located on the premises considered by the appraiser to be personal property, nor has he given consideration to the cost of moving or relocating such personal property; only the real property has been considered. ·Unless otherwise stated in this report, the existence of hazardous material, which may or may not be present on the property, was not observed by the appraiser. The appraiser has no knowledge of the existence of such materials on or in the property. The appraiser, however, is not qualified to detect such substances. The presence of substances such as asbestos, urea-formaldehyde foam insulation, or other potentially hazardous materials may affect the value of the property. The value estimate is predicated on the assumption that there is no such material on or in the property that would cause a loss in value. No responsibility is assumed for any such conditions, or for any expertise or engineering knowledge required to discover them. The client is urged to retain an expert in this field, if desired. ·The appraiser has personally inspected the subject property and finds no obvious evidence of structural deficiencies, except as stated in this report; however, no responsibility for hidden defects or conformity to specific governmental requirements, such as fire, building and safety, earthquake or occupancy codes can be assumed without provision of specific professional or governmental inspections.
·No termite inspection report was available. It is assumed there is no significant termite damage or infestation unless otherwise stated.
·Lease, rental or expense data related to the report being appraised provided by the property owners or responsible parties are assumed to be accurate.
·The conclusions of this report are estimates based on known current trends and reasonably foreseeable future occurrences. These estimates are based partly on property information, data obtained in public records, interviews, existing trends, buyer-seller decision criteria in the current market, and research conducted by third parties, and such data are not always completely reliable. We are not responsible for these and other future occurrences that could not have reasonably been foreseen on the effective date of this assignment. Furthermore, it is inevitable that some assumptions will not materialize and that unanticipated events may occur that will likely affect actual performance.
While we are of the opinion that our findings are reasonable based on current market conditions, we do not represent that these estimates will actually be achieved, as they are subject to considerable risk and uncertainty. Moreover, we assume competent and effective management and marketing for the duration of the projected holding period of this property.
·All prospective value estimates presented in this report are estimates and forecasts which are prospective in nature and are subject to considerable risk and uncertainty. In addition to the contingencies noted in the preceding paragraph, several events may occur that could substantially alter the outcome of our estimates such as, but not limited to changes in the economy, interest rates, and capitalization rates, behavior of consumers, investors and lenders, fire and other physical destruction, changes in title or conveyances of easements and deed restrictions, etc.
It is assumed that conditions reasonably foreseeable at the present time are consistent or similar with the future. ·Unless the time frame is shorter under applicable law, any legal action or claim relating to the appraisal or Appraiser's services shall be tiled in court (or in the applicable arbitration tribunal, if the parties to the dispute have executed an arbitration agreement) within two (2) years from the date of delivery to Client of the appraisal report to which the claims or causes of action relate or, in the case of acts or conduct after delivery of the report, two (2) years from the date of the alleged acts or conduct. The time frame stated in this section shall not be extended by any delay in the discovery or accrual of the underlying claims, causes of action or damages. The time frame stated in this section shall apply to all noncriminal claims or causes of action of any type. ·Any use of or reliance on the appraisal by any party, regardless of whether the use or reliance is authorized or known ents, limiting conditions and
by Appraiser, constitutes acceptance of, and is subject to, all appraisal statem assumptions stated in the appraisal report.
T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A ·The appraisal performed under this Agreement will be subject to all statements, assumptions, limiting conditions and other conditions (collectively, "Appraisal Conditions") set forth in the appraisal report. Client agrees that Client will review the Appraisal Conditions upon receipt of the report and that Client's use of the appraisal will constitute acceptance of the Appraisal Conditions. The Appraisal Conditions shall be considered as being incorporated into and forming part of this Agreement with respect to the appraisal in which they re contained and to the services relating to that appraisal.
·Legal claims orcauses of action relating to the appraisal are not transferable or assignable to a third party, except:
(I) as the result of a merger, consolidation, sale or purchase of a legal entity, (ii) with regard to the collection of a bona fide existing debt for services but then only to the extent of the total compensation for the appraisal plus reasonable interest, or (iii) in the case of an appraisal performed in connection with the origination of a mortgage loan, as part of the transfer or sale of the mortgage before an event of default on the mortgage or note or its legal equivalent.
T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A
ADDENDA SECTION
SUBJECT PHOTOGRAPHS
LEGAL DESCRIPTION
QUALIFICATIONS
T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A
SUBJECT PHOTOGRAPHS
5811 ½ LIVE OAK STREET
BELL GARDENS, CALIFORNIA
View of subject. View of subject
View southerly of subject View northeasterly of subject West on Live Oak East on Live Oak
5811 ½ LIVE OAK STREET
BELL GARDENS, CALIFORNIA
5811 ½ LIVE OAK STREET
BELL GARDENS, CALIFORNIA
T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A
LEGAL DESCRIPTION
T IERRA W EST A DVISORS-5811½L IVE O AK S TREET F ILE N O.23-1700A
QUALIFICATIONS
QUALIFICATIONS OF JEFFREY T. NAGASAKI, MAI
EXPERIENCE
Nagasaki & Associates, 2005 to present; Principal responsible for providing a broad variety of real estate consultation and valuation services for the public and private sectors. Property rights appraised include fee simple, leased fee, and leasehold interest. Services include traditional market value studies, market rent studies, historic valuation studies, value diminution analysis, partial interests for estate planning and family limited partnerships. Assignments deal with all major property types including commercial retail and office, hotel, industrial, marina, multiple residential, acreage, residential subdivisions, and special purpose properties.
He is qualified as an approved appraiser for the U.S. Department of Housing and Urban Development. Mr.
Nagasaki’s experience includes over 45 years of appraisal experience, fully competent and qualified to complete most assignments under the requirements of the competency provisions of USPAP.
Lea Associates, Inc., 1985 - 2005; Principal and Senior Vice President responsible for providing real estate appraisal and consultation services. Property types included retail, office, industrial, creative office, residential income, vacant land, and hotels. Property rights appraised include fee simple, leased fee, and leasehold interest.
Security Pacific National Bank, 1978 - 1985; Assistant Vice President with responsibility for valuation of real property, proposed and existing, including retail, office, industrial, residential income units, vacant land, special purpose properties, single-family residences, condominiums, and residential subdivisions.
EDUCATION
Continuous participation in numerous seminars relating to real estate appraisal theory and practice. A sample of these seminars include:
Limited Appraisals and Reporting OptionsCase Study in Limited Partnership Valuation Environmental Risk and the Real Estate ProcessAffordable Housing Projects Litigation SeminarMarketability discounts for real estate interests Partial AcquisitionPartial interests theory and case law Easement ValuationPublic Interest Value program
Shopping Centers AnalysisValuation of Leases, Leasehold & Leased fees Impact of Detrimental ConditionsGoing Concern Value and Real Property National IRS Symposium on ValuationSpecial Purpose Properties Appraising Family Limited PartnershipsMarket Trends
Successful completion of the following Appraisal Institute's courses and examinations:
Highest and Best Use AnalysisCase Studies in Real Estate Valuation Standards of Professional PracticeCapitalization Theory and Techniques, Part A Comprehensive Examination Capitalization Theory and Techniques, Part B Demonstration Appraisal Report Valuation Analysis and Report Writing Basic Valuation ProceduresReal Estate Appraisal Principles Residential Valuation Appraisal Curriculum Overview
California State University, Long Beach, Bachelor of Science degree in Business Administration specializing in Real Estate Finance and Financial Management, May 1978.
QUALIFICATIONS OF JEFFREY T. NAGASAKI, MAI (Cont’d)
EXPERT TESTIMONY
Mr. Nagasaki has qualified as an expert witness in real estate matters and has testified before:
Los Angeles County Superior Court Riverside County Superior Court San Bernardino County Superior CourtOrange County Superior Court Further, he has appeared in binding and non-binding arbitration hearings as an expert witness in real estate valuation.
ASSOCIATIONS
Member of the Appraisal Institute, with an MAI Designation Certified General Real Estate Appraiser - AG003078, State of California Institute of Real Estate Management (IREM) - Associate Member
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AUTHENTICATED
ELECTRONIC LEGAL MATERIAL
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P
:7
2023
CONTRACT SERVICES AGREEMENT
(Contractor: Xpress Wash, Inc.)
(Nature of Engagement: Mobile Car Wash and Detail Services)
entered into this ___________ day of _________________ 2023 (hereinafter, the by and between the CITY OF BELL GARDENS, a municipal corporation XPRESS WASH, INC.
purposes of this Agreement, CITY and CONTRACTOR may be referred to collectively by CONTRACTOR interchangeably.
RECITALS
WHEREAS, CITY is a municipal corporation organized under the laws of the State of California, with power to contract for services necessary to achieve its purpose; and
WHEREAS, CITY requires qualified and experienced mobile car wash and detail services; and
WHEREAS, CITY staff has determined that CONTRACTOR possess the skills, experience and expertise required to competently provide the services and tasks contemplated under this Agreement; and
WHEREAS, the execution of this Agreement was approved by the Bell Gardens City Council at its Regular Meeting of November 13, 2023.
NOW, THEREFORE, for and in consideration of the mutual covenants and conditions herein contained, CITY and CONTRACTOR agree as follows:
SECTION 1. SCOPE OF WORK.
A. Subject to the terms and conditions of this Agreement, CONTRACTOR agrees to provide CITY mobile car wash and detail services. The various tasks and related services to be performed by CONTRACTOR are more specifically described in the Request for Proposals Mobile Car Wash and Detail Services RFP dated October 5, 2023, and the written proposal of
(hereinafter, the
RFP and the CONTRACTOR
PROPOSAL are attached and incorporated hereto as and
respectively.
RFP
a collective reference to all the various services and tasks referenced in the Scope of Work. In the event of any conflict or inconsistency between the provisions of the document entitled CITY RFP and the provisions of the document entitled CONTRACTOR PROPOSAL, the requirements of the document entitled CITY RFP shall govern and control but only to the extent of the conflict or inconsistency and no further. In the event of any conflict or inconsistency between the provisions 1 of the Scope of Work and the provisions of this Agreement to which the Scope of Work is attached, the provisions of this Agreement shall govern and control.
B. CONTRACTOR shall provide all labor, materials, tools, supplies, equipment, services, tasks and incidental and customary work necessary to competently perform and timely complete the Work. CONTRACTOR shall perform the Work in accordance with the terms and conditions of this Agreement and in accordance with such other written or verbal directives as may be issued by CITY.
C. By executing this Agreement, CONTRACTOR warrants that CONTRACTOR: (i) has thoroughly investigated and considered the nature of the work, services and tasks to be performed under this Agreement; (ii) has carefully considered how the Work should be performed; and (iii) fully understands the facilities, difficulties, and restrictions attending performance of the services under this Agreement.
CONTRACTOR warrants that CONTRACTOR has or will investigate any location where the Work is to be performed and is or will be fully acquainted with the conditions there existing, prior to undertaking any service or task requested by CITY in the manner described under Section 3, below. Should the CONTRACTOR discover any latent or unknown conditions which will materially affect the performance of the services hereunder, CONTRACTOR shall immediately inform the CITY of such fact and shall not proceed
written instructions are received from the City Representative as defined herein.
D. In the event CONTRACTOR ceases to perform the Work agreed to under this Agreement or otherwise abandons any undertaking contemplated herein prior to completion and acceptance of the Work, CONTRACTOR shall deliver to CITY immediately and without delay, all materials, records and other work product prepared or obtained by CONTRACTOR in the performance of this Agreement.
Furthermore, CONTRACTOR shall only be compensated for the reasonable value of the services, tasks and other work performed up to the time of cessation or abandonment, less a deduction for any damages, costs or additional expenses which CITY may incur as a result of CONTRACTOR
SECTION 2. TERM.
A. This Agreement shall have a term of three (3) years commencing from the Effective Date through November 13, 2026 The Term of the
Agreement may be extended by the CITY subject to its same terms and conditions for a maximum of two (2) one-year extensions, provided the CITY issues written notice of its intent to extend the Term of the Agreement prior to the expiration of the initial Term.
B. Nothing in this Section shall operate to
ability to terminate this Agreement at any time for convenience or for cause.
C. CONTRACTOR shall perform the Work continuously and with due diligence.
CONTRACTOR shall cooperate with CITY and in no manner interfere with the Work of CITY, its employees or other consultants, contractors or agents.
D. CONTRACTOR shall not claim or be entitled to receive any compensation or 2 damage because of the failure of CONTRACTOR, or its subcontractors, to have related services or tasks completed in a timely manner.
E. CONTRACTOR shall at all times enforce strict discipline and good order among employees.
F. CONTRACTOR, at its sole expense, shall pay all sales, consumer, use or other similar taxes required by law.
G. CONTRACTOR shall complete the services within the term of this Agreement, and shall meet any other established schedules and deadlines.
SECTION 3. PROSECUTION OF WORK.
A. CONTRACTOR shall perform the Work contemplated under this Agreement on an as-needed, as requested basis. Nothing in this Agreement shall be construed to grant CONTRACTOR the exclusive right to perform any of the types of services or tasks contemplated under this Agreement nor shall anything in this Agreement be construed to entitle CONTRACTOR to the receipt of any sums under this Agreement, except to the extent CITY requests the performance of any Work in the manner described below and such Work is in fact performed and completed by CONTRACTOR and accepted by CITY.
B. CONTRACTOR shall not claim or be entitled to receive any compensation or damage because of the failure of CONTRACTOR, or its subcontractors, to have related services or tasks completed in a timely manner.
C. CONTRACTOR shall at all times enforce strict discipline and good order among
D. CONTRACTOR, at its sole expense, shall pay all sales, consumer, use or other similar taxes required by law.
SECTION 4. COMPENSATION.
A. CONTRACTOR shall perform all the Work in accordance with the rates set forth in the CONTRACTOR PROPOSAL.
B.
exceed the annual sum of FORTY THOUSAND DOLLARS ($40,000) (hereinafter, Annual Not-to- CONTRACTOR further agrees that the Annual Not-to-Exceed Sum is inclusive of compensation for all labor, materials, tools, supplies, equipment, services, tasks and incidental and customary work necessary to competently perform and timely complete the Work. CONTRACTOR shall have no right or entitlement to any overage contingency sums authorized by the City Council unless the City Representative authorizes the expenditure of such overage discretion.
3 C.The Annual Not-to-Exceed Sum will be paid to CONTRACTOR in monthly increments as the Work is completed. Following the conclusion of each calendar month, CONTRACTOR will submit to CITY an itemized invoice indicating the work performed and the tasks completed during the recently concluded calendar month, including the Work and tasks performed and the reimbursable out-of-pocket number of hours worked in connection with the specific service or task requested, the persons responsible for performing the Work, the rate of compensation at which such services and tasks were performed, the subtotal for each task and service performed and a grand total for all services performed. Within thirty (30) calendar days of receipt of each invoice, CITY shall notify CONTRACTOR in writing of any disputed amounts included in the invoice. Within forty-five (45) calendar days of receipt of each invoice, CITY shall pay all undisputed amounts included on the invoice. CITY shall not withhold applicable taxes or other authorized deductions from payments made to CONTRACTOR.
SECTION 5. STANDARD OF CARE. CONTRACTOR represents, acknowledges and agrees as follows:
A. CONTRACTOR shall perform all work skillfully, competently and to the highest
B. CONTRACTOR represents and maintains that it is skilled in the professional calling necessary to perform the Work;
C. CONTRACTOR shall perform all work in a manner reasonably satisfactory to the CITY;
D. CONTRACTOR shall comply with all applicable federal, state and local laws and regulations, including the conflict of interest provisions of Government Code Section 1090 and the Political Reform Act (Government Code Section 81000 et seq.)
limitation, compliance with all applicable Cal/OSHA requirements and applicable regulations of the Federal Department of Housing and Urbanization; E. CONTRACTOR understands the nature and scope of the Work to be performed under this Agreement as well as any and all schedules of performance; F.
bcontractors and subconsultants) possess sufficient skill, knowledge, training and experience to perform those services and tasks contemplated under this Agreement;
G.
tractors and subconsultants) possess all licenses,
permits, certificates, qualifications and approvals of whatever nature that are legally required to perform the tasks and services contemplated under this Agreement and all such licenses, permits, certificates, qualifications and approvals shall be maintained throughout the term of this Agreement; and 4 H. CONTRACTOR shall at all times employ such force, plant, materials, and tools as will be sufficient in the opinion of the CITY to perform the Work within the time limits established, and as provided herein. It is understood and agreed that said tools, equipment, apparatus, facilities, labor, and material shall be furnished and said Work performed and completed as required by the Agreement, and subject to the apWork shall
meet or exceed those standards established by the CITY or County of jurisdiction.
The Parties acknowledge and agree that CONTRACTOR shall perform, at se and without any reimbursement from CITY, any
services or tasks necessary to correct any errors or omissions caused by s employees, agents, contractors,
subcontractors and subconsultants. Such effort by CONTRACTOR to correct any errors or omissions shall be commenced immediately upon their discovery by either Party and shall be completed within seven (7) calendars days from the date of discovery or such other extended period of time authorized by the City Representative in writing and behalf
shall not constitute a release of any deficiency or delay in performance. The Parties further acknowledge, understand and agree that CONTRACTOR has relied upon the foregoing representations of CONTRACTOR, including but not limited to the representation that CONTRACTOR possesses the skills, training, knowledge and experience necessary to perform the Work in a skillful and competent manner equivalent to, the standard of performance generally recognized as being employed by professionals performing the same type of work and services in the State of California.
SECTION 6. REPRESENTATIVES.
A. City Representative. For the purposes of this Agreement, the contract Captain Paul Camacho
to assure that the City Representative is kept informed of the progress of the performance of the services, and CONTRACTOR shall refer any decisions which must be made by CITY to the City Representative. Unless otherwise specified herein, any approval of CITY required hereunder shall mean the approval of the City Representative.
B. Contractor Representative. For the purposes of this Agreement, Juana Hernandez, President, is hereby designated as the principal and representative of performance under this Agreement and to make all decisions in connection therewith (hereinafter,
Representative whether written or verbal shall constitute notice to CONTRACTOR.
The ContractorWork, using their
best skill and attention, and shall be responsible for all means, methods, techniques, sequences, and procedures and for the satisfactory coordination of all portions of the Services under this Agreement.
5 SECTION 7. .
A. CONTRACTOR represents that it has, or will secure at its own expense, all personnel required to perform the Work and all other services and tasks necessary for CONTRACTOR to competently and timely complete the improvements contemplated under this Agreement. All Work, services and tasks will be engaged in the performance of the work, services and tasks contemplated under this Agreement shall possess the qualifications, permits and licenses required by applicable law to perform such work, services and tasks.
B. CONTRACTOR shall obtain at its sole cost and expense such licenses, permits, and approvals as may be required by law for the performance of the Work.
CONTRACTOR shall have the sole obligation to pay for any fees, assessments and taxes, plus applicable penalties and interest, which may be imposed by law Work, and shall indemnify, defend and hold harmless CITY against any such fees, assessments, taxes, penalties, or interest levied, assessed, or imposed against CITY hereunder.
C. CONTRACTOR shall be solely responsible for the satisfactory work performance of all personnel engaged in performing the Work.
D. In the event that CITY, in its sole reasonable discretion, at any time during the term of this Agreement, desires the removal of any person or persons assigned by CONTRACTOR to perform services pursuant to this Agreement, CONTRACTOR shall remove any such person immediately upon receiving notice from CITY of the desire of CITY for the removal of such person or persons.
E.
insurance, and Social Security.
F. CONTRACTOR shall obtain and maintain during the Agreement term all necessary licenses, permits and certificates required by law for the performance of the Work contemplated under this Agreement.
SECTION 8. SUBSTITUTION OF KEY PERSONNEL. CONTRACTOR has represented to CITY that certain key personnel will perform and coordinate the Work under this Agreement. Should one or more of such personnel become unavailable, CONTRACTOR may substitute other personnel of at least equal competence upon written approval of CITY. In the event that CITY and CONTRACTOR cannot agree as to the substitution of key personnel, CITY shall be entitled to terminate this Agreement for cause. As discussed below, any personnel who fail or refuse to perform the Work in a manner acceptable to the CITY, or who are determined by the CITY to be uncooperative, incompetent, a threat to the adequate or timely completion of the Project or a threat to the safety of persons or property, shall be promptly removed from the Project by the CONTRACTOR at the request of the CITY.
6 SECTION 9. \[RESERVED NO TEXT\]
SECTION 10. PROHIBITED INTERESTS. CONTRACTOR warrants, represents and maintains that it has not employed nor retained any company or person, other than a bona fide employee working solely for CONTRACTOR, to solicit or secure this Agreement. Further, CONTRACTOR warrants and represents that it has not paid nor has it agreed to pay any company or person, other than a bona fide employee working solely for CONTRACTOR, any fee, commission, percentage, brokerage fee, gift or other consideration contingent upon or resulting from the award or making of this Agreement.
For breach or violation of this warranty, CITY shall have the absolute and unfettered right to rescind this Agreement without liability or penalty. For the term of this Agreement, no member, officer or employee of CITY, during the term of his or her service with CITY, shall have any direct interest in this Agreement, or obtain any present or anticipated material benefit arising therefrom.
SECTION 11. INDEPENDENT CONTRACTOR.
A. All acts of CONTRACTOR, its agents, officers, subcontractors and employees and all others acting on behalf of CONTRACTOR relating to the performance of this Agreement, shall be performed as independent contractors and not as agents, officers, or employees of CITY. CONTRACTOR, by virtue of this Agreement, has no authority to bind or incur any obligation on behalf of CITY. CONTRACTOR has no authority or responsibility to exercise any rights or power vested in CITY. No agent, officer, or employee of CITY is to be considered an employee of CONTRACTOR. It is understood by both CONTRACTOR and CITY that this Agreement shall not, under any circumstances, be construed or considered to create an employer-employee relationship or a joint venture.
B. CONTRACTOR, its agents, officers, subcontractors and employees are and, at all times during the Term of this Agreement, shall represent and conduct themselves as independent contractors and not as employees of CITY.
C. CONTRACTOR shall determine the method, details and means of performing the Work. CONTRACTOR shall be responsible to CITY only for the requirements and results specified in this Agreement and, except as expressly provided in this Agreement, shall not be subjected to CITY's control with respect to the physical action or activities of the CONTRACTOR in fulfillment of this Agreement.
CONTRACTOR has control over the manner and means of performing the services under this Agreement. CONTRACTOR is permitted to provide services to others during the same period as it provides services to CITY under this Agreement. If necessary, CONTRACTOR has the responsibility for employing other persons or firms to assist CONTRACTOR in fulfilling the terms and obligations under this Agreement.
D. If in the performance of this Agreement any third persons are employed by CONTRACTOR, such persons shall be entirely and exclusively under the direction, supervision, and control of CONTRACTOR. All terms of employment including hours, wages, working conditions, discipline, hiring, and discharging or any other term of employment or requirement of law shall be determined by the CONTRACTOR.
7 E. It is understood and agreed that as an independent contractor and not an employee of CITY neither the CONTRACTOR nor CONTRACTOR'S assigned personnel shall have any entitlement as a CITY employee, right to act on behalf of CITY in any capacity whatsoever as an agent, or to bind CITY to any obligation whatsoever.
F. As an independent contractor, CONTRACTOR hereby indemnifies and holds CITY harmless from any and all claims that may be made against CITY based upon any contention by any third party that an employer-employee relationship exists by reason of this Agreement.
SECTION 12. CONFLICTS OF INTEREST. CONTRACTOR hereby warrants for itself, its employees, and subcontractors that those persons presently have no interest and shall not obtain any interest, direct or indirect, which would conflict in any manner with the performance of the services contemplated by this Agreement. No person having such conflicting interest shall be employed by or associated with CONTRACTOR in connection with this project. CONTRACTOR hereby warrants for itself, its employees, and subcontractors that no such person shall engage in any conduct which would constitute a conflict of interest under any CITY ordinance, state law or federal statute.
CONTRACTOR agrees that a clause substantially similar to this Section shall be incorporated into any sub-contract that CONTRACTOR executes in connection with the performance of this Agreement.
SECTION 13. NON-DISCRIMINATION. During the performance of this Agreement, CONTRACTOR and its subcontractors shall not unlawfully discriminate against any employee or applicant for employment because of race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, gender, gender identity, gender expression, age, sexual orientation, reproductive health decision making or military and veteran status.
CONTRACTOR and subcontractors shall ensure that the evaluation and treatment of their employees and applicants for employment are free of such discrimination.
CONTRACTOR and subcontractors shall comply with the provisions of the Fair Employment and Housing Act (Gov. Code, Section 12900 et seq.). The applicable regulations of the Fair Employment and Housing Act, set forth in Part 2.8, Division 3, of Title 2 of the Government Code are incorporated into this Contract by reference and made a part hereof as if set forth in full. CONTRACTOR and its subcontractors shall give written notice of their obligations under this clause to labor organizations with which they have a collective bargaining or other agreement. This CONTRACTOR shall include the nondiscrimination and compliance provisions of this clause in all subcontracts to perform the Work under this Agreement.
SECTION. 14. INDEMNIFICATION.
A. To the fullest extent permitted by law, CONTRACTOR hereby agrees, at its sole cost and expense, to defend, protect, indemnify, and hold harmless CITY and d appointed officials, officers, attorneys, agents, employees, volunteers, successors, and assigns (collectively "Indemnitees") from and against any and all damages, costs, expenses, liabilities, claims, demands, causes of action, proceedings, expenses, judgments, penalties, liens, and losses of any 8 nature whatsoever, including fees of accountants, attorneys, or other professionals and all costs associated therewith (collectively "Liabilities"), arising or claimed to arise, directly or indirectly, out of, in connection with, resulting from, or related to any act, failure to act, error, or omission of CONTRACTOR or any of materialmen, suppliers or their officers, agents, servants or employees, arising or claimed to arise, directly or indirectly, out of, in connection with, resulting from, or related to this Agreement and the performance or failure to perform any term, provision, covenant, or condition of the Agreement, including this indemnity provision. This indemnity provision is effective regardless of any prior, concurrent, or subsequent active or passive negligence by CONTRACTOR and shall operate to fully indemnify Indemnitees against any such negligence. This indemnity provision shall survive the termination of the Agreement and is in addition to any other rights or remedies which Indemnitees may have under the law or elsewhere under this Agreement. Payment is not required as a condition precedent to an Indemnitee's right to recover under this indemnity provision, and an entry of judgment against any one or more of the Indemnitees shall be conclusive in favor costs incurred
in enforcing this indemnification provision. Notwithstanding the foregoing, nothing in this instrument shall be construed to encompass (a) Indemnitees' sole negligence or willful misconduct to the limited extent that the underlying Agreement is subject to Civil Code § 2782(a), or (b) the contracting public agency's active negligence to the limited extent that the underlying Agreement is subject to Civil Code § 2782(b). This indemnity is effective without reference to the existence or applicability of any insurance coverage(s) which may have been required under the Agreement or any additional insured endorsements which may extend to Indemnitees. Accountants, attorneys, or other professionals employed by Indemnitor to defend Indemnitees shall be selected by Indemnitees.
CONTRACTOR, on behalf of itself and all parties claiming under or through it, hereby waives all rights of subrogation and contribution against the Indemnitees, while acting within the scope of their duties, from all claims, losses and liabilities arising out of or incident to activities or operations performed by or on behalf of the Indemnitor regardless of any prior, concurrent, or subsequent active or passive negligence by the Indemnitees.
B. or any other provision of this Agreement
will not be limited by the provisions of any workers compensation act or similar act.
CONTRACTOR expressly waives its statutory immunity under such statutes or laws as to the Indemnities.
C. CONTRACTOR agrees to obtain executed indemnity agreements with provisions identical to those in this Section from each and every subcontractor or any other person or entity involved by, for, with or on behalf of CONTRACTOR in the performance of this Agreement. In the event CONTRACTOR fails to obtain such indemnity obligations for the benefit of CITY, CONTRACTOR agrees to be fully responsible and indemnify, hold harmless and defend CITY, its officers, agents, employees and volunteers from and against any and all claims and losses, costs or expenses for any damage due to death or injury to any person and injury to any property resulting from any alleged, intentional, reckless, negligent or otherwise 9 wrongful acts, errors or omissions of CONTRACTOR or any of its officers, employees, servants, agents, subcontractors, volunteers or any other person or entity involved by, for, with or on behalf of CONTRACTOR in the performance of incurred by counsel of CITY
D. CITY does not, and shall not; waive any rights that it may possess against CONTRACTOR because of the acceptance by CITY, or the deposit with CITY, of any insurance policy or certificate required pursuant to this Agreement. This hold harmless and indemnification provision shall apply regardless of whether or not any insurance policies are determined to be applicable to the claim, demand, damage, liability, loss, cost or expense. CONTRACTOR agrees that all survive the termination of this
Agreement.
E.
agrees to indemnify and hold CITY harmless from any failure of CONTRACTOR to offset against the amount of any fees due to CONTRACTOR under this Agreement any amount due to CITY from CONTRACTOR as a result of ly pay to CITY any reimbursement or
indemnification arising under this Section.
SECTION 15. INSURANCE.
A. CONTRACTOR shall at all times during the term of this Agreement carry, maintain, and keep in full force and effect, insurance as follows:
1. Commercial General Liability Insurance with minimum limits of One Million Dollars ($1,000,000) for each occurrence and in the aggregate for any personal injury, death, loss or damage.
2. Automobile Liability Insurance for any owned, non-owned or hired vehicle used in connection with the performance of this Agreement with minimum limits of One Million Dollars ($1,000,000) per accident for bodily injury and property damage.
3. B. CONTRACTOR shall require each of its sub-consultants or sub-contractors to maintain insurance coverage that meets all of the requirements of this Agreement.
C. The policies required by this Agreement shall be issued by an insurer admitted in the State of California and
Insurance Guide.
D. CONTRACTOR agrees that if it does not keep the insurance required in this Agreement in full force and effect, CITY may either immediately terminate this Agreement or, if insurance is available at a reasonable cost, CITY may take out 10 thereon.
E. Prior to commencement of Work under this Agreement, CONTRACTOR shall file ertificates of insurance showing that the
insurance policies are in effect and satisfy the required amounts and specifications required pursuant to this Agreement.
F. CONTRACTOR shall provide proof that policies of insurance expiring during the Term of this Agreement have been renewed or replaced with other policies providing at least the same coverage. Such proof will be furnished at least two weeks prior to the expiration of the coverages.
G. The general liability and automobile policies of insurance shall contain an endorsement naming CITY, its elected officials, officers, agents, employees, attorneys, servants, volunteers, successors and assigns as additional insureds.
All of the policies shall contain an endorsement providing that the policies cannot be
CONTRACTOR agrees to require its insurer to modify the certificates of insurance to delete any exculpatory wording stating that failure of the insurer to mail written notice of
with regard to any notice provisions.
H. All policies of Commercial General Liability and Automobile Liability insurance shall be primary and any other insurance, deductible, or self-insurance maintained by the CITY, its officials, officers, employees, agents, or volunteers shall not contribute with this primary insurance. Policies shall contain or be endorsed to contain such provisions.
I. All insurance coverage provided pursuant to this Agreement shall not prohibit volunteers from waiving the right of subrogation prior to a loss. CONTRACTOR hereby waives all rights of subrogation against CITY, its officials, officers, employees, agents and volunteers.
J. Any deductibles or self-insured retentions must be approved by CITY. At the option of CITY, CONTRACTOR shall either reduce or eliminate the deductibles or self-insured retentions with respect to CITY, or CONTRACTOR shall procure a bond guaranteeing payment of losses and expenses.
K. If CONTRACTOR is a Limited Liability Company, general liability coverage must be amended so that the Limited Liability Company and its managers, affiliates, employees, agents, and other persons necessary or incidental to its operation are insureds.
L. Procurement of insurance by CONTRACTOR shall not be construed as a limitation indemnify, hold harmless and defend under Section 15 of this Agreement.
M. In the event any policy of insurance required under this Agreement does not 11 comply with these specifications or is canceled and not replaced immediately so as to avoid a lapse in the required coverage, CITY has the right but not the duty to obtain the insurance it deems necessary and any premium paid by CITY will be promptly reimbursed by CONTRACTOR or CITY will withhold amounts sufficient to pay premium from CONTRACTOR payments. In the alternative, CITY may cancel this Agreement effective upon notice.
N. CITY reserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances.
SECTION 16. RECORDS AND INSPECTION. CONTRACTOR shall keep, and require subcontractors to keep, such books and records as shall be necessary to document the performance of the Work and enable the CITY to evaluate the performance of the Work.
The Contract Officer shall have full and free access to such books and records at all times during normal business hours of CITY, including the right to inspect, copy, audit, and make records and transcripts from such records. Such records shall be maintained for a period of four (4) years following completion of the services hereunder, and the CITY shall have access to such records in the event any audit is required.
SECTION 17. TERMINATION.
A. Termination for Convenience. CITY may immediately terminate this Agreement for convenience, without cause and without penalty or liability at any time upon the issuance of written notice to CONTRACTOR specifying the effective date of such termination. Such termination for convenience shall be made in writing signed by the City Manager. CONTRACTOR may only terminate this Agreement for cause.
B. Termination for Cause. In the event either Party fails to perform any duty, obligation, service or task set forth under this Agreement (or fails to timely perform or properly perform any such duty, obligation, service or task set forth under this all Events of Default, the Party alleging an Event of Default shall give written notice specify: (i) the nature of the Event of Default; (ii) the action required to cure the Event of Default; (iii) a date by which the Event of Default shall be cured, which shall not be less than the applicable cure period set forth in this Section or if a cure is not reasonably possible within the applicable cure period, to begin such cure and diligently prosecute such cure to completion. The Event of Default shall constitute a breach of this Agreement if the defaulting Party fails to cure the Event of Default within the applicable cure period or any extended cure period allowed under this Agreement. An Event of Default shall include, but shall not be limited ions under
this Agreement within the specified time or if no time is specified, within a of any federal, state, local law, rule, procedure or regulation; (iii) the initiation of proceedings under any bankruptcy, insolvency, receivership, reorganization, or similar legislation as relates to CONTRACTOR, whether voluntary of involuntary; condition, obligati
12 that a statement representation or warranty by CONTRACTOR relating to this Agreement is false or erroneous in any material respect, including any statement, representation or warranty set forth in the Equipment Specifications.
1. CONTRACTOR shall cure the following Event of Default within the following time periods:
i.
for any failure of CONTRACTOR to timely provide CITY or employees or agents with any information and/or written reports, documentation or work product which CONTRACTOR is obligated to Prior to the expiration of the 3-day cure period, CONTRACTOR may submit a written request for additional time to cure the Event of Default upon a showing that CONTRACTOR has commenced efforts to cure the Event of Default and that the Event of Default cannot be reasonably cured within the 3-day cure period. The foregoing notwithstanding, CITY shall be under no obligation to grant additional time for the cure of an Event of Default under this subsection that exceeds seven (7) calendar days from the end of the initial 3-day cure period; or
ii. Within thirty (30)
for any other Event of Default under this Agreement. Prior to the expiration of the 30-day cure period, CONTRACTOR may submit a written request for additional time to cure the Event of Default upon a showing that CONTRACTOR has commenced efforts to cure the Event of Default and that the Event of Default cannot be reasonably cured within the 30-day cure period. The foregoing notwithstanding, CITY shall be under no obligation to grant additional time for the cure of an Event of Default under this subsection that exceeds thirty (30) calendar days from the end of the initial 30-day cure period.
If an Event of Default relates to a material falsehood or misrepresentation set forth in Exhibit B that is not susceptible to a cure, CITY in its sole and absolute discretion may elect to treat the falsehood or misrepresentation as a breach of this Agreement or waive the falsehood or misrepresentation. The foregoing notwithstanding, the prior waiver of a falsehood or misrepresentation as an Event of Default shall not operate as a waiver or any other falsehood or misrepresentation later discovered by CITY.
2. Except as otherwise specified in this Agreement, CITY shall cure any Event of Default asserted by CONTRACTOR within thirty (30) calendar days of cannot reasonably be cured within the 30-day cure period. Prior to the expiration of the 30-day cure period, CITY may submit a written request for additional time to cure the Event of Default upon a showing that CITY has commenced its efforts to cure the Event of Default and that the Event of Default cannot be reasonably cured within the 30-day cure period. The foregoing notwithstanding,
any undisputed sums to CONTRACTOR shall be cured by CITY within five (5) 13 3. CITY, in its sole and absolute discretion, may also immediately suspend any specific task or function performed by CONTRACTOR under this CONTRACTOR written notice of C
Suspension Notice at any time upon the occurrence of an Event of Default.
Upon such suspension, CONTRACTOR shall be compensated only for those services and tasks which have been rendered by CONTRACTOR to the reasonable satisfaction of CITY up to the effective date of the suspension. No actual or asserted breach of this Agreement on the part of CITY shall operate to prohibit or otherwise restrict CITY
provided herein.
4. No waiver of any Event of Default or breach under this Agreement shall constitute a waiver of any other or subsequent Event of Default or breach. No waiver, benefit, privilege, or service voluntarily given or performed by a Party shall give the other Party any contractual rights by custom, estoppel, or otherwise.
5. The duties and obligations imposed under this Agreement and the rights and remedies available hereunder shall be in addition to and not a limitation of any duties, obligations, rights and remedies otherwise imposed or available by law.
In addition to any other remedies available to CITY at law or under this Agreement in the event of any breach of this Agreement, CITY, in its sole and absolute discretion, may also pursue any one or more of the following remedies:
i. Upon written notice to CONTRACTOR, the CITY may immediately terminate this Agreement in whole or in part;
ii. Upon written notice to CONTRACTOR, the CITY may extend the time of performance;
iii. The CITY may proceed by appropriate court action to enforce the terms the Agreement or to terminate the Agreement; or
iv. The CITY may exercise any other available and lawful right or remedy.
CONTRACTOR shall be liable for all legal fees plus other costs and expenses its remedies under this Agreement.
6. In the event CITY is in breach of this Agreement, CON remedy shall be the suspension or termination of this Agreement and/or the recovery of any unpaid sums lawfully owed to CONTRACTOR under this Agreement for completed services and tasks. In no event shall CONTRACTOR 14 be entitled to receive more than the amount that would be paid to CONTRACTOR for the full performance of the services required by this Agreement.
7. No waiver of any default or breach under this Agreement shall constitute a waiver of any other default or breach, whether of the same or other covenant, warranty, agreement, term, condition, duty or requirement contained in this Agreement. No waiver, benefit, privilege, or service voluntarily given or performed by a Party shall give the other Party any contractual rights by custom, estoppel, or otherwise.
SECTION 18. FORCE MAJEURE. The Term shall be extended in the event of any delays due to unforeseeable causes beyond the control of CONTRACTOR and without the fault or negligence of CONTRACTOR, including but not limited to severe weather, fires, earthquakes, floods, epidemics, quarantine restrictions, riots, strikes, freight embargoes, wars, litigation, and/or acts of any governmental agency, including the CITY, if the CONTRACTOR shall within three (3) calendar days of the commencement of such delay notify the City Representative in writing of the causes of the delay. The City Representative shall ascertain the facts and the extent of delay, and extend the time for performing the services for the period of the enforced delay when and if in the judgment shall be final and conclusive upon the parties to this Agreement. In no event shall CONTRACTOR be entitled to recover damages against the CITY for any delay in the extension of the Agreement pursuant to this Section.
SECTION 19. NOTICES. Any notices, bills, invoices, or reports required by this Agreement shall be deemed received on: (a) the day of delivery if delivered by hand or (b) on the third business day following deposit in the United States mail, postage prepaid, to the addresses heretofore below, or to such other addresses as the parties may, from time to time, designate in writing.
If to CITY: If to CONTRACTOR:
City of Bell Gardens Xpress Wash, Inc.
7100 S. Garfield Avenue 4950 Slauson Avenue
Bell Gardens, CA 90201 Maywood, CA 90270
Attn: Police Department Attn: Juana Hernandez, President Phone: 562-806-7700 Phone: 323-560-8219
SECTION 20. PROHIBITION. CONTRACTOR shall not delegate, transfer, subcontract or assign its duties or rights hereunder, either in
written consent, and any attempt to do so shall be void and of no effect. CITY shall not be obligated or liable under this Agreement to any party other than CONTRACTOR.
SECTION 21. ATTORNEY FEES. In the event that CITY or CONTRACTOR commences any legal action or proceeding to enforce or interpret the provisions of this Agreement, 15 the prevailing party shall be entitled to recover its costs of suit, including reasonable attor
SECTION 22. ENTIRE AGREEMENT. All documents referenced as exhibits in this Agreement are hereby incorporated in this Agreement. Except as expressly provided in this Agreement or its Exhibits, in the event of any conflict or inconsistency between the express provisions of this Agreement and provisions of any document incorporated by reference, the provisions of this Agreement shall prevail and control. This instrument contains the entire Agreement between CITY and CONTRACTOR with respect to the subject matter herein. No other prior oral or written agreements are binding on the parties.
Any modification of this Agreement will be effective only if it is in writing and executed by both CITY and CONTRACTOR.
SECTION 23. GOVERNING LAW; JURISDICTION. This Agreement shall be interpreted and governed according to the laws of the State of California. In the event of litigation between the Parties, venue, without exception, shall be in the Los Angeles County Superior Court of the State of California. If, and only if, applicable law requires that all or part of any such litigation be tried exclusively in federal court, venue, without exception, shall be in the Central District of California located in the City of Los Angeles, California.
SECTION 24. SEVERABILITY. Wherever possible, each provision of this Agreement shall be interpreted in such a manner as to be valid under applicable law. If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions shall nevertheless continue in full force and effect.
SECTION 25. CAPTIONS. The captions used in this Agreement are solely for reference and the convenience of the Parties. The captions are not a part of the Agreement, in no way bind, limit, or describe the scope or intent of any provision, and shall have no effect upon the construction or interpretation of any provision herein.
SECTION 26. EXECUTION. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all of which when taken together shall constitute one and the same instrument.
\[SIGNATURES ON FOLLOWING PAGE\]
16 IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed the day and year first appearing in this Agreement, above.
CITY OF BELL GARDENS, a municipal XPRESS WASH, INC.
corporation
By: By: ______________________________
City Manager Name:____________________________
Date: Title:_____________________________
Date:
APPROVED AS TO FORM:
By:_____________________________
Stephanie Vasquez
City Attorney
Date:
17 CITY RFP
18 REQUEST FOR PROPOSALS
MOBILE CAR WASHAND DETAIL
SERVICES
RFP Release Date
Proposal Submittal Deadline
Contact Person:
TABLE OF CONTENTS
INTRODUCTION
SUBMITTAL PROCEDURES/DEADLINE
6;11!q/n/!po!Uivstebz-!Pdupcfs!2:-!3134 MOBILE CAR
WASH AND DETAIL SERVICES
SCHEDULE
SCHEDULE
TERMSAND CONDITIONS
PROFESSIONALSERVICESAGREEMENT
Exhibit
GENERAL INSTRUCTIONS, TERMS AND CONDITIONS
A.
B.
C.
D.
E.
F.
G.
H.
I.
J.
K.
L.
M.
N.
O.
P.
Q.
R.
BACKGROUND
SCOPE OF SERVICES
CITY OF BELL GARDENS RESPONSIBILITY
PROPOSAL FORMAT AND CONTENT REQUIREMENTS
Not to Exceed
EVALUATION CRITERIA
SELECTION PROCESS
SAMPLE PROFESSIONAL SERVICES AGREEMENT
DO NOT COMPLETE
B
CONTRACTOR PROPOSAL
19 2023
PROFESSIONAL SERVICES AGREEMENT
(Engagement: Training and Policy Consultant Services)
(Parties: Torben Beith Consulting and City of Bell Gardens)
THIS PROFESSIONAL SERVICES AGREEMENT (hereinafter, e) is made and entered into this ___________ day of __________________ 2023 (hereinafter, the by and between the CITY OF BELL GARDENS, a municipal corporation (hereinafter, CITY and TORBEN BEITH CONSULTING CONSULTANT For the purposes of this Agreement, CITY and CONSULTANT may be referred to collectively by
CITY or CONSULTANT interchangeably, as appropriate.
RECITALS
WHEREAS, CITY requires professional training and policy consultant services; and
WHEREAS, CITY staff has determined that CONSULTANT possesses the experience, skills and training necessary to competently provide such services to CITY; and
WHEREAS, the execution of this Agreement was approved by the Bell Gardens City Council at its Regular Meeting.
NOW, THEREFORE, for and in consideration of the mutual covenants and conditions herein contained, CITY and CONSULTANT agree as follows:
I.
ENGAGEMENT TERMS
1.1 TERM: This Agreement shall have a term of three (3) years commencing from the Effective Date through November 13, 2026 Nothing in
terminate this Agreement at any time for convenience or for cause as provided under Article V (Termination), below. The Term of the Agreement may be extended by the CITY subject to its same terms and conditions for a maximum of two (2) one-year extensions, provided the CITY issues written notice of its intent to extend the Term of the Agreement prior to the expiration of the initial Term.
1.2 SCOPE OF WORK:
A. Subject to the terms and conditions of this Agreement, CONSULTANT agrees to provide the services and tasks described in that certain Request Request for Proposals Training and Policy
dated October 12, 2023, and the
Proposal Training and Policy
PROPOSAL). The CITY
1 RFP and the CONSULTANT PROPOSAL are attached and incorporated hereto as and r
shall be a collective reference to the CITY RFP and the CONSULTANT
PROPOSAL
all the various services and tasks referenced in the Scope of Work. In the event of any conflict or inconsistency between the provisions of the document entitled CITY RFP and the provisions of the document entitled CONSULTANT PROPOSAL, the requirements of the document entitled CITY RFP shall govern and control but only to the extent of the conflict or inconsistency and no further. In the event of any conflict or inconsistency between the provisions of the Scope of Work and the provisions of this Agreement to which the Scope of Work is attached, the provisions of this Agreement shall govern and control.
1.3 PROSECUTION OF WORK:
A. CONSULTANT shall perform Work continuously and with due diligence so as to complete the Work within the Term of this Agreement;
B. CONSULTANT shall cooperate with CITY and in no manner interfere with the work of CITY, its employees or other consultants, contractors or agents;
C. CONSULTANT shall not claim or be entitled to receive any compensation or damage because of the failure of CONSULTANT, or its subconsultants, to have related services or tasks completed in a timely manner;
D. CONSULTANT shall at all times enforce strict discipline and good order
E. CONSULTANT, at its sole expense, shall pay all sales, consumer, use or other similar taxes required by law.
1.4 COMPENSATION: CONSULTANT shall perform the Work in accordance with the CONSULTANT PROPOSAL. The foregoing notwithstanding, CONSULTANTs total compensation for the performance of all Work contemplated under this Agreement, will not exceed the annual budgeted sum of Fifty-Five Thousand Dollars ($55,000) (hereinAnnual Not-to- during the
prosecution of this Agreement, unless such added expenditure is first approved by the City Council.
the Annual Not-to-Exceed Sum prior to the expiration of this Agreement, CITY may approval of any anticipated
expenditures in excess of the Annual Not-to-Exceed Sum or any other CITY approved amendment to the compensation terms of this Agreement.
1.5 PAYMENT OF COMPENSATION: Following the conclusion of the Work requested in Section 1.2, CONSULTANT shall submit to CITY an itemized invoice indicating the services performed and tasks completed during the recently concluded calendar month, including services and tasks performed and the reimbursable out- of-pocket expenses incurred. If the amount of CONSULTANTs compensation is 2 a function of hours workedby CONSULTANTs personnel, the invoice should indicate the number of hours worked, the persons responsible for performing the Work, the rate of compensation at which such services and tasks were performed, the subtotal for each task and service performed and a grand total for all services performed. Within thirty (30) calendar days of receipt of each invoice, CITY will notify CONSULTANT in writing of any disputed amounts included in the invoice.
Within forty-five (45) calendar days of receipt of each invoice, CITY will pay all undisputed amounts included on the invoice. CITY will not withhold applicable taxes or other authorized deductions from payments made to CONSULTANT.
1.6 ACCOUNTING RECORDS: CONSULTANT will maintain complete and accurate records with respect to all matters covered under this Agreement for a period of three (3) years after the expiration or termination of this Agreement. CITY will have the right to access and examine such records, without charge, during normal business hours. CITY will further have the right to audit such records, to make transcripts therefrom and to inspect all program data, documents, proceedings, and activities.
1.7 ABANDONMENT BY CONSULTANT: In the event CONSULTANT ceases to perform the Work agreed to under this Agreement or otherwise abandons the undertaking contemplated herein prior to the expiration of this Agreement or prior to completion of any or all tasks set forth in the Scope of Work, CONSULTANT will deliver to CITY immediately and without delay, all materials, records and other work product prepared or obtained by CONSULTANT in the performance of this Agreement. Furthermore, CONSULTANT will only be compensated for the reasonable value of the services, tasks and other Work performed up to the time of cessation or abandonment, less a deduction for any damages, costs or additional expenses which CITY may incur as a result of CONSULTANTs cessation or abandonment.
II.
PERFORMANCE OF AGREEMENT
2.1 CITYS REPRESENTATIVE: The CITY hereby designates Paul Camacho, Captain, City for the
performance of this Agreement. The City Representative or their designee will act on behalf of the CITY for all purposes under this Agreement. CONSULTANT will not accept directions or orders from any person other than the City Representative or their designee.
2.2 CONSULTANT REPRESENTATIVE: CONSULTANT hereby designates Torben Beith, to act as its representative for the performance of this Agreement Consultant Representative Consultant Representative will have full authority to represent and act on behalf of the CONSULTANT for all purposes under this Agreement. Consultant Representative or their designee will supervise and direct the performance of the Work, using their best skill and attention, and will be responsible for all means, methods, techniques, sequences and procedures and for the satisfactory coordination of all portions of the Work under this Agreement. Notice to the Consultant Representative will constitute notice to 3 CONSULTANT.
2.3 COORDINATION OF SERVICE; CONFORMANCE WITH REQUIREMENTS:
CONSULTANT agrees to work closely with CITY staff in the performance of the Work and this Agreement and will be available to CITY staff and the City Representative at all reasonable times. All work prepared by CONSULTANT will be subject to inspection and approval by City Representative or their designees.
2.4 STANDARD OF CARE; PERFORMANCE OF EMPLOYEES: CONSULTANT represents, acknowledges and agrees to the following:
A. CONSULTANT will perform all Work skillfully, competently and to the highest standards of CONSULTANTs profession;
B. CONSULTANT shall at all times employ such force, plant, materials, and tools as will be sufficient in the opinion of the CITY to perform the Services within the time limits established, and as provided herein. It is understood and agreed that said tools, equipment, apparatus, facilities, labor, and material shall be furnished and said Services performed and completed as
authorized representative;
C. CONSULTANT will perform all Work in a manner reasonably satisfactory to the CITY;
D. CONSULTANT will comply with all applicable federal, state and local laws and regulations, including the conflict of interest provisions of Government Code Section 1090 and the Political Reform Act (Government Code Section 81000 et seq.). CONSULTANT shall be liable for all violations of such laws and regulations in connection with Services. If CONSULTANT performs any work knowing it to be contrary to such laws, rules and regulations, CONSULTANT shall be solely responsible for all costs arising therefrom;
E. CONSULTANT understands the nature and scope of the Work to be performed under this Agreement as well as any and all schedules of performance;
F. All of CONSULTANTs employees and agents possess sufficient skill, knowledge, training and experience to perform those services and tasks assigned to them by CONSULTANT; and
G. All of CONSULTANTs employees and agents (including, but not limited to, subcontractors and subconsultants) possess all licenses, permits, certificates, qualifications and approvals of whatever nature that are legally required to perform the tasks and services contemplated under this Agreement and all such licenses, permits, certificates, qualifications and approvals will be maintained throughout the term of this Agreement and made available to CITY for copying and inspection.
4 The Parties acknowledge and agree thatCONSULTANTwillperform, at CONSULTANTs own cost and expense and without any reimbursement from CITY, any services necessary to correct any errors or omissions caused by CONSULTANTs failure to comply with the standard of care set forth under this Section or by any like failure on the part of CONSULTANTs employees, agents, contractors, subcontractors and subconsultants. Such effort by CONSULTANT to correct any errors or omissions will be commenced immediately upon their discovery by either Party and will be completed within seven (7) calendar days from the date of discovery or such other extended period of time authorized by the City Representative in writing and in their sole and absolute discretion. The Parties acknowledge and agree that CITYs acceptance of any work performed by CONSULTANT or on CONSULTANTs behalf will not constitute a release of any deficiency or delay in performance. The Parties further acknowledge, understand and agree that CITY has relied upon the foregoing representations of CONSULTANT, including but not limited to the representation that CONSULTANT possesses the skills, training, knowledge and experience necessary to perform the Work skillfully, competently and to the highest standards of CONSULTANTs profession.
2.5 ASSIGNMENT: The skills, training, knowledge and experience of CONSULTANT are material to CITYs willingness to enter into this Agreement. Accordingly, CITY has an interest in the qualifications and capabilities of the person(s) who will perform the services and tasks to be undertaken by CONSULTANT or on behalf of CONSULTANT in the performance of this Agreement. In recognition of this interest, CONSULTANT agrees that it will not assign or transfer, either directly or indirectly or by operation of law, this Agreement or the performance of any of CONSULTANTs duties or obligations under this Agreement without the prior written consent of the CITY. In the absence of CITYs prior written consent, any attempted assignment or transfer will be ineffective, null and void and will constitute a material breach of this Agreement.
2.6 SUBSTITUTION OF KEY PERSONNEL: CONSULTANT has represented to CITY that certain key personnel will perform and coordinate the Services under this Agreement. Should one or more of such personnel become unavailable, CONSULTANT may substitute other personnel of at least equal competence upon written approval of CITY. In the event that CITY and CONSULTANT cannot agree as to the substitution of key personnel, CITY shall be entitled to terminate this Agreement for cause. As discussed below, any personnel who fail or refuse to perform the Services in a manner acceptable to the CITY, or who are determined by the CITY to be uncooperative, incompetent, a threat to the adequate or timely completion of the Project or a threat to the safety of persons or property, shall be promptly removed from the Project by the CONSULTANT at the request of the CITY.
2.7 CONTROL AND PAYMENT OF SUBORDINATES; INDEPENDENT
CONTRACTOR: The Work will be performed by CONSULTANT or under CONSULTANTs strict supervision. CONSULTANT will determine the means, methods and details of performing the Work subject to the requirements of this Agreement. CITY retains CONSULTANT on an independent contractor basis and 5 not as an employee. CONSULTANTreserves the right to perform similar or different services for other principals during the term of this Agreement, provided such work does not unduly interfere with CONSULTANTs competent and timely performance of the Work contemplated under this Agreement and provided the performance of such services does not result in the unauthorized disclosure of CITYs confidential or proprietary information. Any additional personnel performing the Work under this Agreement on behalf of CONSULTANT are not employees of CITY and will at all times be under CONSULTANTs exclusive direction and control. CONSULTANT will pay all wages, salaries and other amounts due to such personnel and will assume responsibility for all benefits, payroll taxes, Social Security and Medicare payments and the like. CONSULTANT will be responsible for all reports and obligations respecting such additional personnel, including, but not limited to: Social Security taxes, income tax withholding, unemployment insurance, disability insurance, workers compensation insurance and the like.
2.8 REMOVAL OF EMPLOYEES OR AGENTS: If any of CONSULTANTs officers, employees, agents, contractors, subcontractors or subconsultants is determined by the City Representative to be uncooperative, incompetent, a threat to the adequate or timely performance of the tasks assigned to CONSULTANT, a threat to persons or property, or if any of CONSULTANTs officers, employees, agents, contractors, subcontractors or subconsultants fail or refuse to perform the Work in a manner acceptable to the CITY, such officer, employee, agent, contractor, subcontractor or subconsultant will be promptly removed by CONSULTANT and will not be reassigned to perform any of the Work.
2.9 COMPLIANCE WITH LAWS: CONSULTANT will keep itself informed of and in compliance with all applicable federal, state or local laws to the extent such laws control or otherwise govern the performance of the Work. CONSULTANTs compliance with applicable laws will include, without limitation, compliance with all applicable Cal/OSHA requirements and applicable regulations of the Federal Department of Housing and Urbanization.
2.10 NON-DISCRIMINATION: CONSULTANT represents that it is an equal opportunity employer and it shall not discriminate against any subconsultant, employee or applicant for employment because of race, religion, color, national origin, handicap, ancestry, sex or age. Such non-discrimination shall include, but not be limited to, all activities related to initial employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination.
2.11 INDEPENDENT CONTRACTOR STATUS: The Parties acknowledge, understand and agree that CONSULTANT and all persons retained or employed by CONSULTANT are, and will at all times remain, wholly independent contractors and are not officials, officers, employees, departments or subdivisions of CITY.
CONSULTANT will be solely responsible for the negligent acts and/or omissions of its employees, agents, contractors, subcontractors and subconsultants.
CONSULTANT and all persons retained or employed by CONSULTANT will have no authority, express or implied, to bind CITY in any manner, nor to incur any obligation, debt or liability of any kind on behalf of, or against, CITY, whether by contract or otherwise, unless such authority is expressly conferred to 6 CONSULTANTunder this Agreementor is otherwise expressly conferredbyCITY in writing.
III.
INSURANCE
3.1DUTY TO PROCURE AND MAINTAIN INSURANCE:Prior to the beginning of and throughout the duration of the Work, CONSULTANT will procure and maintain policies of insurance that meet the requirements and specifications set forth under this Article. CONSULTANTwillprocure and maintain the following insurance coverage, at its own expense:
A.Commercial General Liability Insurance:CONSULTANTwillprocure and broad as Insurance Services Office Commercial General Liability coverage (occurrence Form CG 0001)or its equivalent. Such CGL Coverage will have minimum limits of no less than One Million Dollars ($1,000,000.00) per occurrenceand Two Million Dollars ($2,000,000.00) in the general aggregatefor bodily injury, personal injury, property damage, operations, products and completed operations, and contractual liability.
B.AutomobileLiabilityInsurance:CONSULTANTwillprocureandmaintain AutomobileLiabilityInsuranceasbroadasInsuranceServicesOfficeForm NumberCA0001coveringAutomobileLiability,Code1(anyauto).Such AutomobileLiabilityInsuranceshallhaveminimumlimitsofnolessthan Dollars($00,000.00)peraccidentforbodily
injuryandpropertydamage.
C.WorkersCompensationInsurance/EmployersLiabilityInsurance:Apolicy ofworkerscompensationinsuranceinsuchamountaswillfullycomplywith thelawsoftheStateofCaliforniaandwhichwillindemnify,insureand providelegaldefenseforbothCONSULTANTandCITYagainstanyloss, claimordamagearisingfromanyinjuriesoroccupationaldiseases occurringtoanyworkeremployedbyoranypersonsretainedby
CONSULTANTinthe courseofcarrying outtheWorkcontemplatedinthis Agreement.
D.Errors&OmissionsInsurance:ForthefulltermofthisAgreementandfor aperiodofthree(3)yearsthereafter,CONSULTANTwillprocureand maintainErrorsandOmissionsLiabilityInsuranceappropriateto CONSULTANTsprofession.Suchcoveragewillhaveminimumlimitsof olessthanDollars ($,000.00) perclaim.
3.2ADDITIONAL INSURED REQUIREMENTS: The CGL Coverage and the Automobile Liability Insurance willcontain an endorsement naming the CITYand CITYselected and appointed officials, officers, employees, agents and volunteers as additional insureds.
7 3.3REQUIRED CARRIER RATING: All varieties of insurance required under this Agreement will be procured from insurers admitted in the State of California and authorized to issue policies directly to California insureds. Except as otherwise provided elsewhere under this Article, all required insurance will be procured from insurers who, according to the latest edition of the Bests Insurance Guide, have an A.M. Bests rating of no less than A:VII. CITY may also accept policies procured by insurance carriers with a Standard & Poors rating of no less than BBB according to the latest published edition the Standard & Poors rating guide. As to Workers Compensation Insurance/ Employers Liability Insurance, the CITY Representative is authorized to authorize lower ratings than those set forth in this Section.
3.4 PRIMACY OF CONSULTANTS INSURANCE: All policies of insurance provided by CONSULTANT will be primary to any coverage available to CITY or CITYs elected or appointed officials, officers, employees, agents or volunteers. Any insurance or self-insurance maintained by CITY or CITYs elected or appointed officials, officers, employees, agents or volunteers will be in excess of CONSULTANTs insurance and will not contribute with it.
3.5 WAIVER OF SUBROGATION: All insurance coverage provided pursuant to this Agreement will not prohibit CONSULTANT or CONSULTANTs officers, employees, agents, subcontractors or subconsultants from waiving the right of subrogation prior to a loss. CONSULTANT hereby waives all rights of subrogation against CITY, its officials, officers, employees, agents and volunteers.
3.6 VERIFICATION OF COVERAGE: CONSULTANT acknowledges, understands and agrees, that CITYs ability to verify the procurement and maintenance of the insurance required under this Article is critical to safeguarding CITYs financial well-being and, indirectly, the collective well-being of the residents of the CITY.
Accordingly, CONSULTANT warrants, represents and agrees that it will furnish CITY with original certificates of insurance and endorsements evidencing the coverage required under this Article on forms satisfactory to CITY in its sole and absolute discretion. The certificates of insurance and endorsements for each insurance policy will be signed by a person authorized by that insurer to bind coverage on its behalf, and will be on forms provided by the CITY if requested. All certificates of insurance and endorsements will be received and approved by CITY as a condition precedent to CONSULTANTs commencement of any Work. Upon CITYs written request, CONSULTANT will also provide CITY with certified copies of all required insurance policies and endorsements.
3.7 FAILURE TO MAINTAIN COVERAGE: In the event any policy of insurance required under this Agreement does not comply with these specifications or is canceled and not replaced immediately so as to avoid a lapse in the required coverage, CITY has the right but not the duty to obtain the insurance it deems necessary and any premium paid by CITY will be promptly reimbursed by CONSULTANT or CITY will withhold amounts sufficient to pay premium from CONSULTANT payments. In the alternative, CITY may cancel this Agreement effective upon notice.
8 3.8SPECIAL RISKS OR CIRCUMSTANCES. CITYreserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances.
IV.
INDEMNIFICATION
4.1 The Parties agree that CITY an
ity
the fullest extent permitted by law, be protected from any and all loss, injury, cost arising out of or in any way related to the performance of this Agreement. Accordingly, the provisions of this indemnity provision are intended by the Parties to be interpreted and construed to provide the City Indemnitees with the fullest protection possible under the law. CONSULTANT acknowledges that CITY wou
commitment to indemnify, defend and protect CITY as set forth herein. to Civil Code Section 2782.8, the above indemnity shall be limited, to the extent required by Civil Code Section 2782.8, to Claims that arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of the CONSULTANT. stricted to insurance
proceeds, if any, received by the CITY, its officials, officers, employees, agents or volunteers.
4.2 To the fullest extent permitted by law, CONSULTANT shall indemnify, hold harmless and defend the City Indemnitees from and against all liability, loss, expert fees and all other costs, and fees of litigation) of every nature arising out of failure
to comply with any of its obligations contained in this Agreement, except such loss or damage which is caused by the sole negligence or willful misconduct of the CITY.
4.3 CITY shall have the right to offset against the amount of any compensation due to CONSULTANT under this Agreement, any amount due to CITY from ity
Indemnitees under this
pay taxes on amounts received pursuant to this Agreement, or (ii) comply with
4.4 The obligations of CONSULTANT under this Article will not be limited by the pro
expressly waives its statutory immunity under such statutes or laws as to CITY and volunteers.
9 4.5CONSULTANT agrees to obtain executed indemnity agreements with provisions identical to those set forth herein this Article from each and every subcontractor or any other person or entity involved by, for, with or on behalf of CONSULTANT in the performance of this Agreement. In the event CONSULTANT fails to obtain such indemnity obligations from others as required herein, CONSULTANT agrees elected and appointed officials, officers, employees, agents, and volunteers from and against any and all claims and losses, costs or expenses for any damage due to death or injury to any person and injury to any property resulting from any alleged intentional, reckless, negligent, or otherwise wrongful acts, errors or involved by, for, with or on behalf of CONSULTANT in the performance of this incurred by counsel o
4.6 CITY does not, and shall not waive any rights that it may possess against CONSULTANT because of the acceptance by CITY, or the deposit with CITY, of any insurance policy or certificate required pursuant to this Agreement. This hold harmless and indemnification provision shall apply regardless of whether or not any insurance policies are determined to be applicable to the claim, demand, damage, liability, loss, cost, or expense.
4.7 This Article and all provisions contained herein (including but not limited to the duty to indemnify, defend, and hold free and harmless) shall survive the termination or normal expiration of this Agreement and is in addition to any other rights or remedies which the CITY may have at law or in equity.
V.
TERMINATION
5.1 TERMINATION WITHOUT CAUSE: CITY may immediately terminate this Agreement at any time for convenience and without cause by giving prior written notice of CITYs intent to terminate this Agreement which notice shall specify the effective date of such termination. Upon such termination for convenience, CONSULTANT will be compensated only for those services and tasks which have been performed by CONSULTANT up to the effective date of the termination.
CONSULTANT may not terminate this Agreement except for cause as provided under Section 5.2, below. If this Agreement is terminated as provided herein, CITY may require CONSULTANT to provide all finished or unfinished Documents and Data, as defined in Section 6.1, below, and other information of any kind prepared by CONSULTANT in connection with the performance of the Work.
CONSULTANT will be required to provide such Documents and Data within fifteen (15) calendar days of CITYs written request. No actual or asserted breach of this Agreement on the part of CITY pursuant to Section 5.2, below, will operate to prohibit or otherwise restrict CITYs ability to terminate this Agreement for convenience as provided under this Section.
10 5.2EVENTS OF DEFAULT; BREACH OF AGREEMENT:
A. In the event either Party fails to perform any duty, obligation, service or task set forth under this Agreement (or fails to timely perform or properly perform any such duty, obligation, service or task set forth under this Agreement), an evenwill occur. For all Events
of Default, the Party alleging an Event of Default will give written notice to will
specify: (i) the nature of the Event of Default; (ii) the action required to cure the Event of Default; (iii) a date by which the Event of Default will be cured, which will not be less than the applicable cure period set forth under Sections 5.2(B) and 5.2(C), below, or if a cure is not reasonably possible within the applicable cure period, to begin such cure and diligently prosecute such cure to completion. The Event of Default will constitute a breach of this Agreement if the defaulting Party fails to cure the Event of Default within the applicable cure period or any extended cure period allowed under this Agreement.
B. CONSULTANT will cure the Event of Default within the following time periods:
i. Within ten (10) business days of CITYs issuance of a Default Notice for any failure of CONSULTANT to timely provide CITY or CITYs employees or agents with any information and/or written reports, documentation or work product which CONSULTANT is obligated to provide to CITY or CITYs employees or agents under this Agreement.
Prior to the expiration of the 10-day cure period, CONSULTANT may submit a written request for additional time to cure the Event of Default upon a showing that CONSULTANT has commenced efforts to cure the Event of Default and that the Event of Default cannot be reasonably cured within the 10-day cure period. The foregoing notwithstanding, CITY will be under no obligation to grant additional time for the cure of an Event of Default under this Section 5.2(B)(i) that exceeds seven (7) calendar days from the end of the initial 10-day cure period; or
ii. Within fourteen (14) calendar days of CITYs issuance of a Default Notice for any other Event of Default under this Agreement. Prior to the expiration of the 14-day cure period, CONSULTANT may submit a written request for additional time to cure the Event of Default upon a showing that CONSULTANT has commenced efforts to cure the Event of Default and that the Event of Default cannot be reasonably cured within the 14-day cure period. The foregoing notwithstanding, CITY will be under no obligation to grant additional time for the cure of an Event of Default under this Section 5.2(B)(ii) that exceeds thirty (30) calendar days from the end of the initial 14-day cure period.
In addition to any other failure on the part of CONSULTANT to perform any duty, obligation, service or task set forth under this Agreement (or the failure to timely perform or properly perform any such duty, obligation, service or 11 task), an Event of Default on the part of CONSULTANT willinclude, but will not be limited to the following: (i) CONSULTANTs refusal or failure to perform any of the services or tasks called for under the Scope of Work; (ii) CONSULTANTs failure to fulfill or perform its obligations under this Agreement within the specified time or if no time is specified, within a reasonable time; (iii) CONSULTANTs and/or its employees disregard or violation of any federal, state, local law, rule, procedure or regulation; (iv) the initiation of proceedings under any bankruptcy, insolvency, receivership, reorganization, or similar legislation as relates to CONSULTANT, whether voluntary of involuntary; (v) CONSULTANTs refusal or failure to perform or observe any covenant, condition, obligation or provision of this Agreement; and/or (vii) CITYs discovery that a statement representation or warranty by CONSULTANT relating to this Agreement is false, misleading or erroneous in any material respect.
C. CITY will cure any Event of Default asserted by CONSULTANT within forty- five (45) calendar days of CONSULTANTs issuance of a Default Notice, unless the Event of Default cannot reasonably be cured within the 45-day cure period. Prior to the expiration of the 45-day cure period, CITY may submit a written request for additional time to cure the Event of Default upon a showing that CITY has commenced its efforts to cure the Event of Default and that the Event of Default cannot be reasonably cured within the 45-day cure period. The foregoing notwithstanding, an Event of Default dealing with CITYs failure to timely pay any undisputed sums to CONSULTANT as provided under Section 1.5, above, will be cured by CITY within five (5) calendar days from the date of CONSULTANTs Default Notice to CITY.
D. CITY, in its sole and absolute discretion, may also immediately suspend CONSULTANTs performance under this Agreement pending
CONSULTANTs cure of any Event of Default by giving CONSULTANT written notice of CITYs intent to suspend CONSULTANTs performance CITY may issue the Suspension
Notice at any time upon the occurrence of an Event of Default. Upon such suspension, CONSULTANT will be compensated only for those services and tasks which have been rendered by CONSULTANT to the reasonable satisfaction of CITY up to the effective date of the suspension. No actual or asserted breach of this Agreement on the part of CITY will operate to prohibit or otherwise restrict CITYs ability to suspend this Agreement as provided herein.
E. No waiver of any Event of Default or breach under this Agreement will constitute a waiver of any other or subsequent Event of Default or breach.
No waiver, benefit, privilege, or service voluntarily given or performed by a Party will give the other Party any contractual rights by custom, estoppel, or otherwise.
F. The duties and obligations imposed under this Agreement and the rights and remedies available hereunder will be in addition to and not a limitation of any duties, obligations, rights and remedies otherwise imposed or 12 available by law. In addition to any other remedies available to CITYat law or under this Agreement in the event of any breach of this Agreement, CITY, in its sole and absolute discretion, may also pursue any one or more of the following remedies:
i. Upon written notice to CONSULTANT, the CITY may immediately terminate this Agreement in whole or in part;
ii. Upon written notice to CONSULTANT, the CITY may extend the time of performance;
iii. The CITY may proceed by appropriate court action to enforce the terms of the Agreement to recover damages for CONSULTANTs breach of the Agreement or to terminate the Agreement; or
iv. The CITY may exercise any other available and lawful right or remedy.
CONSULTANT will be liable for all legal fees plus other costs and expenses that CITY incurs upon a breach of this Agreement or in the CITYs exercise of its remedies under this Agreement.
G. In the event CITY is in breach of this Agreement, CONSULTANTs sole remedy will be the suspension or termination of this Agreement and/or the recovery of any unpaid sums lawfully owed to CONSULTANT under this Agreement for completed services and tasks.
5.3 SCOPE OF WAIVER: No waiver of any default or breach under this Agreement will constitute a waiver of any other default or breach, whether of the same or other covenant, warranty, agreement, term, condition, duty or requirement contained in this Agreement. No waiver, benefit, privilege, or service voluntarily given or performed by a Party will give the other Party any contractual rights by custom, estoppel, or otherwise.
5.4 SURVIVING ARTICLES, SECTIONS AND PROVISIONS: The termination of this Agreement pursuant to any provision of this Article or by normal expiration of its term or any extension thereto will not operate to terminate any Article, Section or provision contained herein which provides that it will survive the termination or normal expiration of this Agreement.
VI.
MISCELLANEOUS PROVISIONS
6.1 DOCUMENTS & DATA; LICENSING OF INTELLECTUAL PROPERTY: All Documents and Data will be and remain the property of CITY without restriction or limitation upon their use or dissemination by CITY. For purposes of this analyses, correspondence, plans, designs, notes, summaries, strategies, charts, schedules, spreadsheets, calculations, lists, data compilations, documents or other materials developed and/or assembled by or on behalf of CONSULTANT in 13 the performance of this Agreement and fixed in any tangible medium of expression, including but not limited to Documents and Data stored digitally, magnetically and/or electronically. This Agreement creates, at no cost to CITY, a perpetual license for CITY to copy, use, reuse, disseminate and/or retain any and all copyrights, designs, and other intellectual property embodied in all Documents and Data. CONSULTANT will require all subcontractors and subconsultants working on behalf of CONSULTANT in the performance of this Agreement to agree in writing that CITY will be granted the same right to copy, use, reuse, disseminate and retain Documents and Data prepared or assembled by any subcontractor or subconsultant as applies to Documents and Data prepared by CONSULTANT in the performance of this Agreement.
6.2 CONFIDENTIALITY: All data, documents, discussion, or other information developed or received by CONSULTANT or provided for performance of this Agreement are deemed confidential and will not be disclosed by CONSULTANT without prior written consent by CITY. CITY will grant such consent of disclosure as legally required. Upon request, all CITY data will be returned to CITY upon the termination or expiration of this Agreement. CONSULTANT will not use CITYs name or insignia, photographs, or any publicity pertaining to the Work in any magazine, trade paper, newspaper, television or radio production or other similar medium without the prior written consent of CITY.
6.3 FALSE CLAIMS ACT: CONSULTANT warrants and represents that neither CONSULTANT nor any person who is an officer of, in a managing position with, or has an ownership interest in CONSULTANT has been determined by a court or tribunal of competent jurisdiction to have violated the False Claims Act, 31 U.S.C., Section 3789 et seq. and the California False Claims Act, Government Code Section 12650 et seq.
6.4 NOTICES: All notices permitted or required under this Agreement will be given to the respective Parties at the following addresses, or at such other address as the respective Parties may provide in writing for this purpose:
CONSULTANT: CITY:
Torben Beith Consulting City of Bell Gardens
59742 Hop Patch Spring Road 7100 S. Garfield Avenue
Mountain Center, CA 92561 Bell Gardens, CA 90201
Attn: Torben Beith Attn: Captain Camacho, Police
Phone: 714-616-6173 Department
Phone: 562-806-7700
Such notices will be deemed effective when personally delivered or successfully transmitted by facsimile as evidenced by a fax confirmation slip or when mailed, forty-eight (48) hours after deposit with the United States Postal Service, first class postage prepaid and addressed to the Party at its applicable address.
6.5 COOPERATION; FURTHER ACTS: The Parties will fully cooperate with one another, and will take any additional acts or sign any additional documents as are reasonably necessary, appropriate or convenient to achieve the purposes of this 14 Agreement.
6.6 SUBCONTRACTING: CONSULTANT will not subcontract any portion of the Work required by this Agreement, except as expressly stated herein, without the prior written approval of CITY. Subcontracts (including without limitation subcontracts with subconsultants), if any, will contain a provision making them subject to all provisions stipulated in this Agreement, including provisions relating to insurance requirements and indemnification.
6.7 CITYS RIGHT TO EMPLOY OTHER CONSULTANTS: CITY reserves the right to employ other contractors in connection with the various projects worked upon by CONSULTANT.
6.8 PROHIBITED INTERESTS: CONSULTANT warrants, represents and maintains that it has not employed nor retained any company or person, other than a bona fide employee working solely for CONSULTANT, to solicit or secure this Agreement. Further, CONSULTANT warrants and represents that it has not paid nor has it agreed to pay any company or person, other than a bona fide employee working solely for CONSULTANT, any fee, commission, percentage, brokerage fee, gift or other consideration contingent upon or resulting from the award or making of this Agreement. For breach or violation of this warranty, CITY will have the right to rescind this Agreement without liability. For the term of this Agreement, no member, officer or employee of CITY, during the term of his or her service with CITY, will have any direct interest in this Agreement, or obtain any present or anticipated material benefit arising therefrom.
6.9 TIME IS OF THE ESSENCE: Time is of the essence for each and every provision of this Agreement.
6.10 GOVERNING LAW AND VENUE: This Agreement will be interpreted and governed according to the laws of the State of California. In the event of litigation between the Parties, venue, without exception, will be in the Los Angeles County Superior Court of the State of California. If, and only if, applicable law requires that all or part of any such litigation be tried exclusively in federal court, venue, without exception, will in the Central District of California located in the City of Los Angeles, California.
6.11 : If either Party commences an action against the other Party, legal, administrative or otherwise, arising out of or in connection with this Agreement, the prevailing Party in such litigation will be entitled to have and recover from the losing Party reasonable and all other costs of such action.
6.12 SUCCESSORS AND ASSIGNS: This Agreement will be binding on the successors and assigns of the Parties.
6.13 NO THIRD-PARTY BENEFIT: There are no intended third-party beneficiaries of any right or obligation assumed by the Parties. All rights and benefits under this Agreement inure exclusively to the Parties.
15 6.14 CONSTRUCTION OF AGREEMENT: This Agreement will not be construed in favor of, or against, either Party but will be construed as if the Parties prepared this Agreement together through a process of negotiation and with the advice of their respective attorneys.
6.15 SEVERABILITY: If any portion of this Agreement is declared invalid, illegal, or otherwise unenforceable by a court of competent jurisdiction, the remaining provisions will continue in full force and effect.
6.16 AMENDMENT; MODIFICATION: No amendment, modification or supplement of this Agreement will be valid or binding unless executed in writing and signed by both Parties, subject to CITY approval. The requirement for written amendments, modifications or supplements cannot be waived and any attempted waiver will be void and invalid.
6.17 CAPTIONS: The captions of the various articles, sections and paragraphs are for convenience and ease of reference only, and do not define, limit, augment, or describe the scope, content, or intent of this Agreement.
6.18 INCONSISTENCIES OR CONFLICTS: In the event of any conflict or inconsistency between the provisions of this Agreement and any of the exhibits attached hereto, the provisions of this Agreement will control.
6.19 ENTIRE AGREEMENT: This Agreement, including all attached exhibits, constitutes the entire, complete, final and exclusive expression of the Parties with respect to the matters addressed herein and supersedes all other agreements or understandings, whether oral or written, which may have been entered into between CITY and CONSULTANT prior to the execution of this Agreement. Any statements, representations, or other agreements, whether oral or written, made by either Party that is not embodied herein will not be valid or binding on the Parties. No amendment, modification or supplement to this Agreement will be valid and binding unless in writing and duly executed by the Parties pursuant to Section
6.16, above.
6.20 FORCE MAJEURE: The Term shall be extended in the event of any delays due to unforeseeable causes beyond the control of CONSULTANT and without the fault or negligence of CONSULTANT, including but not limited to severe weather, fires, earthquakes, floods, epidemics, quarantine restrictions, riots, strikes, freight embargoes, wars, litigation, and/or acts of any governmental agency, including the CITY, if the CONSULTANT shall within three (3) calendar days of the commencement of such delay notify the City Representative in writing of the causes of the delay. The City Representative shall ascertain the facts and the extent of delay, and extend the time for performing the services for the period of the enforced delay when and if in the judgment of the City Representative such conclusive upon the parties to this Agreement. In no event shall CONSULTANT be entitled to recover damages against the CITY for any delay in the performance of this Agreement, however caused, CONSULTANT sole remedy being 16 extension of the Agreement pursuant to this Section.
6.21 COUNTERPARTS: This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all of which when taken together shall constitute one and the same instrument. No handwritten or typewritten amendment, modification or supplement to any one counterpart will be valid or binding unless made to all three counterparts in conformity with Section
6.16, above. One fully executed original counterpart will be delivered to CONSULTANT and two original counterparts will be retained by CITY.
(SIGNATURES ON NEXT PAGE)
17 IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed the day and year first appearing in this Agreement, above.
CITY OF BELL GARDENS: TORBEN BEITH CONSULTING:
By:_______________________________ By:_______________________________
Name:____________________________ Name:____________________________
Title:____________________ Title:____________________
Date:_____________________ Date:_____________________
APPROVED AS TO FORM:
By:____________________________
Stephanie Vasquez, City Attorney
18 CITY RFP
19 REQUEST FOR PROPOSALS
TRAINING AND POLICY CONSULTANT
RFP Release Date
Thursday, October 12, 2023
Proposal Submittal Deadline
5:00 p.m., Thursday, October 26, 2023
Contact Person:
Paul Camacho, Captain
City of Bell Gardens
7100 Garfield Avenue
Bell Gardens, CA 90201
(562) 806-7692
[email protected]
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TABLE OF CONTENTS
TABLE OF CONTENTS..........................................................................................................2 INTRODUCTION.....................................................................................................................3 SUBMITTAL PROCEDURES/DEADLINE...............................................................................3 SCHEDULE.............................................................................................................................3 DEFINITIONS, TERMS, AND CONDITIONS..........................................................................4 BACKGROUND.......................................................................................................................7 SCOPE OF SERVICES...........................................................................................................7 CITY OF BELL GARDENS RESPONSIBILITY........................................................................9 PROPOSAL FORMAT AND CONTENT REQUIREMENTS....................................................9 COST OF RESPONSE PREPARATION...............................................................................11 EVALUATION CRITERIA......................................................................................................11 CONSULTANT SELECTION PROCESS..............................................................................12 PUBLIC RECORDS ACT......................................................................................................12 COMMUNICATIONS.............................................................................................................13 SAMPLE PROFESSIONAL SERVICES AGREEMENT........................................................14
INTRODUCTION
is seeking a qualifiedpolice trainingand policyconsultant with proven expertise and experience.The primary goal of this RFP is to solicit proposals from qualified consultant(s)who can assist the police department with policy implementation and training management, effective and efficiently required by the Police Department.
The City reserves the right to accept or reject any or all responses received in response to this request. The City also reserves the right to waive any informality, technical defect or clerical error or irregularity in any response.nagreementwill not be based on any single factor, nor will it be based solely or exclusively on the lowest cost proposal.
If an agreementis awarded, it will be awarded to the consultantwho in the judgment of the City has presented an optimal balance of relevant experience, price, quality of service, work history and other factors which the City may consider relevant and important in determining which proposal is best for the City.Additionally, the City may, for any reason, decide not to award an agreement based on this RFP. The City reserves the right to cancel this RFP. The City shall not be obligated to respond to any responses submitted, nor be legally bound in any manner by the submission of the response. The City reserves the right to negotiate deliverables and associated costs.
SUBMITTAL PROCEDURES/DEADLINE
Proposals must be submitted electronically via email to [email protected] later than 6;11!q/n/po!Uivstebz-!Pdupcfs37-!3134. The subject line shouldread Training and Policy ConsultantLate proposals will not be considered. If the proposal includes any comments over and above the specific information requested in this RFP, such information should be included as a separate appendix and placed at the end of the proposal.
SCHEDULE
The tentative schedule for this RFPis as follows:
SCHEDULE
RFP Available OnlineOctober 12,2023
Deadline to SubmitRFP QuestionsOctober 16, 2023
Answers to RFP Questions Posted OnlineOctober 23, 2023
Proposal Due DateOctober 26, 2023, 5:00 P.M.
Proposal Review PeriodOctober26-30, 2023
Awards PostedNovember 13, 2023
*The schedule above is tentativeand subject to change at the discretion of the City, with