Attachment 4
MEMORANDUM OF UNDERSTANDING BETWEEN
THE CITY OF SAN DIEGO
AND
THE CITY OF CHULA VISTA
FOR THE SAN DIEGO REGION REVOLVING LOAN FUND
This Memorandum of Understanding for the San Diego Region Revolving Loan Fund (MOU) is entered into by and between the CITY OF SAN DIEGO, a municipal corporation (San Diego) and the CITY OF CHULA VISTA, a municipal corporation (Chula Vista), sometimes referred to collectively as the “Parties” and each individually, as a “Party.” The Parties enter into this MOU with reference to the following recited facts (each, a “Recital”):
RECITALS
A. In 2002, the cities of San Diego and Chula Vista established the San Diego Regional Revolving Loan Fund (Regional RLF) with total funding of $2,766,616, operated by San Diego for the benefit of businesses in the cities of San Diego and Chula Vista. Regional RLF utilized EDA Grant #07-79-05269 in the amount of $1,383,308 and participant funding amounting $1,283,308 from San Diego and $100,000 from Chula Vista.
B. On October 10, 2019, the Regional RLF was consolidated with the Micro Revolving Loan Fund to form the San Diego Region Revolving Loan Fund (SDRRLF) as EDA RLF Grant #07-57-05269, for a total of $4,274,958.
C. San Diego may request to de-federalize the SDRRLF under the Reinvigorating Lending for the Future Act, which authorizes the U.S. Department of Commerce Economic Development Administration (EDA) to release its federal interest in certain SDRRLF awards that have operated satisfactorily for seven years beyond disbursement of grant funds. Such a release will reduce the administrative burden on SDRRLF recipients and allow SDRRLF award funds to be used for broader economic development purposes beyond lending.
D. De-federalized SDDRLF assets ascribed as federal funds will still be subject to certain ongoing EDA requirements. The proposed use of de-federalized funds is subject to EDA approval and must be consistent with the federal Public Works and Economic Development Act (PWEDA).
E. A separate fund, the CARES Act Revolving Loan Fund (CARES Act RLF), is a disaster recovery and resiliency public revolving loan fund operated by San Diego on behalf of San Diego and Chula Vista, adopted in September 2020. At the time of this MOU, the CARES Act RLF is not eligible for de-federalization with EDA, and an existing Administrative Plan, approved by the EDA, is in effect. San Diego will continue to service existing loans for businesses based in Chula Vista that are a part of the CARES Act RLF until those loans reach maturity or are written off, after which San Diego will no longer make new loans to Chula Vista businesses.
F. In advance of this de-federalization opportunity, both San Diego and Chula Vista desire to enter into this MOU in order to unwind the combined loan program for the SDRRLF.
G. The Council of the City of San Diego (“San Diego City Council”) adopted Resolution R- _______, ( ____________, 2024) and the Council of the City of Chula Vista (”Chula Vista City Council”) adopted Resolution R-_______, ( ____________, 2024), authorizing each Party to enter into this MOU.
NOW, THEREFORE, San Diego and Chula Vista agree as follows:
1. Term. This MOU shall be effective on the date it is executed by the last Party to sign the Agreement, and approved by the City Attorney in accordance with San Diego Charter Section 40 and remain effective through the date of the maturity of the last Chula Vista CARES Act loan or five years from the signing of this MOU, whichever occurs first. This MOU supersedes and terminates all prior MOUs between the San Diego and Chula Vista for the SDRRLF.
2. Amendments to MOU. This MOU may be amended by a written document signed by authorized representatives of both Parties.
3. Termination. Either San Diego or Chula Vista may terminate this MOU for any reason by providing 30 days written Notice to each other.
4. San Diego Region Revolving Loan Fund Grant Transfer. The initial Chula Vista grant match of $100,000.00 has been expended in administrative costs over the 22-year period of the SDRRLF, and no grant transfer will occur to return funds to Chula Vista.
5. San Diego Responsibilities.
5.1. San Diego shall administer the SDRRLF, including loans made in Chula Vista.
5.2. San Diego shall administer the CARES Act RLF, until all loans reach maturity. San Diego will not make new loans in Chula Vista using CARES Act funds.
5.3. San Diego shall fulfill reporting requirements to the EDA, including semi-annual ED- 209 reporting and Schedule of Expenditures of Federal Awards reporting. Any data collection required for such reports will be the responsibility of San Diego.
5.4. San Diego shall administer all Chula Vista loans under the SDRRLF and CARES Act RLF and, upon maturity, the close out activities for all loans. In cases where a loan borrower is no longer able to fulfill their monthly payment obligation, San Diego shall make all attempts to collect funds with payment solutions, or write-off the loan when applicable.
5.5. San Diego will abide by the established EDA Administration Plans for the SDRRLF and CARES Act RLF.
6. Chula Vista Responsibilities.
6.1. Chula Vista City Manager will recommend that the Chula Vista City Council
approve this MOU with San Diego.
7. Compliance with Federal, State and local Regulations. San Diego and Chula Vista shall comply with all applicable federal, State and local regulations, including the Public Works and Economic Development Act (“PWEDA”).
8. San Diego Revolving Loan Fund Advisory Board (SDRLF Advisory Board).
8.1. San Diego will continue to administer the SDRLF Advisory Board.
8.2. Chula Vista will continue to have a designated representative on the SDRLF Advisory Board for as long as Chula Vista loans, including those that are a part of the CARES Act RLF, remain a part of San Diego’s overall RLF portfolio. Once all Chula Vista loans mature and reach the end of their terms, the representative will rotate off the board, unless otherwise agreed upon by San Diego and Chula Vista.
9. San Diego Representative. The person identified below is San Diego’s representative for all purposes of this MOU (“San Diego Representative”). The San Diego Representative shall communicate with Chula Vista on all matters related to the administration of this MOU, the SDRRLF, and Chula Vista’s performance of its obligations under this MOU.
When this MOU refers to communications to or with San Diego, those communications shall be with the San Diego Representative, unless this MOU or the San Diego Representative specifies otherwise. When this MOU refers to an act or approval to be performed by San Diego, that act or approval shall be performed by the San Diego Representative, unless this MOU specifies otherwise. San Diego may change the identity of the San Diego Representative at any time by Notice to Chula Vista at least ten (10) days in advance of the effective date of such change.
Sean Karafin, Interim Deputy Director, Economic Development Department, [email protected], (619) 727-9562
10. Chula Vista Representative. The person identified below is Chula Vista’s representative for all purposes of this MOU (“Chula Vista Representative”). The Chula Vista Representative shall communicate with San Diego on all matters related to this MOU. When this MOU refers to communications to or with Chula Vista, those communications shall be with the Chula Vista Representative, unless this MOU or the Chula Vista Representative specifies otherwise. When this MOU refers to any act or approval to be performed by Chula Vista, that act or approval shall be performed by the Chula Vista Representative, unless this MOU specifies otherwise. Chula Vista may change the identity of the Chula Vista Representative at any time by Notice to San Diego at least ten (10) days in advance of the effective date of such change.
Maria V. Kachadoorian, City Manager, [email protected], (619)691- 5031
11. Indemnification. To the fullest extent provided by law, San Diego and Chula Vista, each respectively, agree to defend, indemnify, protect, and hold harmless one another, including
their elected officials, officers, agents, representatives, departments, subcontractors, and employees, from and against any and all claims, demands, actions, proceedings, suits, liabilities, damages, costs (including reasonable attorneys’ fees) or expenses for, including damage to property, the loss or use thereof, or injury or death to any person, caused by, arising out of, or related to the performance of services under this MOU by San Diego or Chula Vista, their elected officials, officers, agents, representatives, departments, subcontractors and employees. San Diego’s and Chula Vista’s duty to indemnify and hold harmless one another shall not include any claim or liability arising from the established sole negligence or willful misconduct of the other, or the other’s elected officials, officers, agents, representatives, departments, subcontractors, and employees.
12. Insurance. San Diego certifies that it is self-insured and will maintain the same level of insurance throughout the duration of this MOU.
13. Notice. Unless otherwise specified, in all cases where Notice is required under this MOU, Notice shall be in writing and transmitted to the address of San Diego or Chula Vista, as applicable, as designated in Exhibit A, by one or more of the following methods: (a) electronic mail; (b) messenger for same day personal delivery; (c) overnight delivery via a nationally recognized delivery service (Federal Express, United Parcel Service, etc.); or (d) registered or certified mail, postage prepaid, return receipt requested, through the United States Postal Service. Notice must be sent to the address specified by each Party in Exhibit A unless a Party has changed its address by issuing a notice in accordance with this section 14, in which case the changed address shall be used instead. Notice shall be deemed received by the addressee on the date sent by electronic mail, if sent before 3:00 p.m. Pacific Time, the date the Notice is delivered by personal delivery, on the date the Notice is delivered (or the date of the second attempted delivery, as set forth in a written statement of the delivery service) by a nationally recognized overnight delivery service, or three (3) calendar days after the Notice is deposited with the United States Postal Service as provided in this section 14.
Rejection, other refusal to accept or the inability to deliver a Notice because of a changed address of which no Notice was given, shall be deemed receipt of the Notice. San Diego or Chula Vista may change its Notice address by Notice delivered in accordance with this section 13.
14. General Provisions
14.1. Governing Law . The terms and conditions of this MOU shall be construed and interpreted in accordance with the laws of the State of California.
14.2. Jurisdiction and Venue. The Parties agree to submit to the personal jurisdiction of, and that venue shall be in, any State of California court within the County of San Diego, State of California, for any dispute, claim, or matter arising out of, or related to, this MOU.
14.3. Integration and Amendment . This MOU and the exhibits attached to this MOU fully express all understandings of the Parties concerning the matters covered in this MOU.
All prior negotiations and agreements between the Parties regarding the subject matter of this MOU are merged into th is MOU. No change, alteration, amendment, or modification of the terms or conditions of this MOU, and no verbal understanding of
the Parties, their officers, agents, or employees shall be valid, unless made in the form of a written amendment to this MOU signed by both Parties. The Parties agree to enter into any and all amendments to this MOU that are necessary to comply with any and all new or modified federal or State of California laws applicable to this MOU.
14.4. No Waiver. No failure of either San Diego or Chula Vista to insist upon the strict performance by the other of any term, covenant, or condition of this MOU, nor any failure to exercise any right or remedy consequent upon a breach of any term, covenant, or condition of this MOU, shall constitute a wa iver of any such breach or the requirement to comply with such term, covenant, or condition. No waiver of any breach shall affect or alter this MOU, and each and every term, covenant, and condition in this MOU shall continue in full force and effect regard ing any existing or subsequent breach.
14.5. Successors in Interest. This MOU and all rights, obligations, or duties under this MOU, shall be in full force and effect, whether or not any Party to this MOU has been succeeded by another entity, and all rights, obligations, or duties under this MOU shall be vested and binding on any Party’s successor in interest, subject to the limitations in this MOU on assignment of this MOU.
14.6. No Assignment. Neither Party may assign any rights or obligations under this MOU without the prior written consent of the other Party.
14.7. Severability. The unenforceability, invalidity, or illegality of any provision of this MOU shall not render any other provision of this MOU unenforceable, invalid, or illegal.
14.8. Conflicts between Terms . If an app arent conflict or inconsistency exists between the main body of this MOU and any exhibit, the main body of this MOU shall control. If a conflict exists between an applicable law, rule, regulation, order, or code and this MOU, then the law, rule, regulation, order, or code shall control. Varying degrees of stringency among the main body of this MOU, the exhibits, and laws, rules, regulations, orders, or codes are not deemed conflicts, and the most stringent requirement shall control. Each Party shall notify the other in writing immediately upon the identification of any apparent conflict or inconsistency concerning this MOU.
14.9. Principles of Interpretation. No inference in favor of or against any Party shall be drawn from the fact that such Party has drafted an y part of this MOU. The Parties have both participated substantially in the negotiation, drafting, and revision of this MOU, with advice from legal and other counsel and advisers of their own selection. A word, term or phrase defined in this MOU may be used in the singular, plural, past tense or future tense, regardless of how it is defined, all in accordance with ordinary principles of English grammar, which shall govern all language in this MOU. The words “include” and “including” in this MOU shall be construed to be followed by the words: “without limitation.” Each collective noun in this MOU shall be interpreted as if followed by the words “(or any part of it),” except where the context clearly requires otherwise. Every reference to any document, including this MOU, refers to such document, as modified from time to time (excepting any modification that violates this MOU), and includes all exhibits, schedules, addenda and riders to such document. The word “or” in this MOU includes the word “and,” except w here the context requires otherwise. Every reference to a law, statute, regulation, order, form or similar governmental requirement
in this MOU refers to each such requirement as amended, modified, renumbered, superseded or succeeded, from time to time.
14.10. Counterparts. This MOU may be signed in multiple counterparts, which, when taken together, shall constitute a single signed original, as though all Parties had signed the same MOU.
14.11. Headings. All headings in this MOU are for convenience of reference only an d shall not affect the interpretation of this MOU.
14.12. Exhibits Incorporated . All exhibits referenced in or attached to this MOU are incorporated into this MOU.
14.13. Survival of Obligations . All representations, indemnifications, warranties, and guarantees made in, required by, or given in accordance with this MOU, and all continuing obligations set forth in this MOU, shall survive expiration or earlier termination of this MOU.
14.14. Incorporation of Recitals . The Recitals preceding this MOU are true and correct and are incorporated into and made a part of this MOU.
14.15. Time of Essence . Time is of the essence of each provision of this MOU, unless otherwise specified in this MOU.
14.16. Further Assurances. San Diego and Chula Vista agree to cooperate fully and execute any and all supp lementary documents and take all additional actions which may be necessary or appropriate to give full force and effect to the basic terms and intent of this MOU.
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SIGNATURE PAGE
TO
MEMORANDUM OF UNDERSTANDING BETWEEN
THE CITY OF SAN DIEGO
AND
THE CITY OF CHULA VISTA
FOR THE SAN DIEGO REGION REVOLVING LOAN
FUND
IN WITNESS WHEREOF, this MOU is entered into by the City of San Diego, acting by and through its Mayor or designee, and by the City of Chula Vista, by and through the signature of its authorized representative(s), all as set forth below.
CITY OF CHULA VISTA,
a California municipal corporation
By:_______________________________
CITY OF SAN DIEGO,
a California municipal corporation
By: _______________________________
APPROVED AS TO FORM:
By: _______________________________
APPROVED AS TO FORM:
HEATHER FERBERT
CITY ATTORNEY
By: _______________________________
Deputy City Attorney
Marguerite E. Middaugh
Exhibit A-1
San Diego Region Revolving Loan Fund
EXHIBIT A
Notice Addresses
San Diego:
The City of San Diego
Economic Development Department
1200 Third Avenue, Suite 1400, San Diego, CA 92101
[email protected]
CHULA VISTA:
The City of Chula Vista
276 Fourth Avenue
Chula Vista, CA 91910
[email protected]