Agenda Item B.3
CPMS CONSENT CALENDAR
Meeting Date: May 17, 2022
TO: Mayor and Councilmembers
FROM: Matt Fore, General Services Director
SUBJECT: Term Extension to Goleta Valley Community Center Management an d Lease Extension
RECOMMENDATION:
Approve and authorize the City Manager to execute Amendment Number 3 to the Interim Management and Lease Agreement with the Goleta Valley Community Center extending the term through December 31, 2022.
BACKGROUND:
The City owns the Goleta Community Center (GCC) campus and has a lease agreement with the nonprofit Goleta Valley Community Center (“GVCC”) organization for the provision of recreational, literary, scientific, and educational opportunities to the public. At its meeting on June 18, 2019, the City Council approved a two-year extension to the lease from January 30, 2020, through June 30, 2022, to allow time for staff to evaluate whether community center functions should be provided by GVCC, another nonprofit, or City staff.
In January 2021, based on an opinion from the City’s Building Official (Willdan), City Council amended the lease again to exclude the main Auditorium and Dining Hall until seismic upgrades are complete and these spaces can again be safely occupied.
On August 31, 2021, the City Council held a special workshop regarding the GCC facility and its operation. Council considered recommendations from the Goleta Community Center Ad Hoc Committee. The Committee recommended that the City assume direct management of the Goleta Community Center (GCC) upon the June 30, 2022, expiration of the lease with the GVCC.
Following the August 31, 2021, workshop, Council asked staff to return at a future date for two purposes: 1) to present a Management Plan and timeline to assume management of the facility from GVCC on July 1, 2022; and 2) to discuss a process to develop and adopt a Strategic Plan for the Goleta Community Center. The proposed plan would allow the City to manage the GCC during the upcoming $8 million (or m ore) seismic and ADA improvements capital project and to develop a comprehensive Str ategic Plan for the 1 Meeting Date: May 17, 2022
Community Center before determining the best long-term manageme nt model for the future.
Staff returned to Council on February 24, 2022 and presented a draft Management Plan for direct management of the Community Center by the City upon expiration of the agreement with the GVCC. The draft Management Plan assumed that the City would commence management of the facility on July 1, 2022. However, C ouncil thought it prudent to extend the GVCC lease through December 2022, to allow GVCC to transition its role from facility manager to program manager under the new management model.
This was assumed to be possible because construction was not pl anned to begin until January 2023.
Ultimately, Council approved a pl an for the City to assume direct management of the Goleta Community Center effective January 1, 2023 and authorized the City Manager to negotiate a lease extension with the GVCC with an expiration date of December 31, 2022.
Staff and the Goleta Community Center Ad Hoc Committee have beg un the strategic planning process. A request for proposals (RFP) for consultant services has been issued, and a Working Group has been formed to assist and advise the Ad Hoc Committee in that effort. Simultaneously, the Public Works Department has been moving forward with the seismic and ADA upgrade projects, which are tentatively sch eduled to begin this winter, but may need to begin earlier, as explained in the “Discussion” section of this report. The City’s proposed Fiscal Year 2022 -23 Budget includes a budget for Community Center operations, and a staffing plan is being implemented.
Staff have also discussed the transition with the GVCC and offered the City’s assistance to them as they plan to move from a facility manager to a new o perational model in January 2023.
DISCUSSION:
Consistent with Council’s direction, Staff is recommending that Council approve and authorize the City Manager to execute Amendment Number 3 to the Interim Management and Lease Agreement with the Goleta Valley Community Center extending the term from June 30, 2022, to December 31, 2022 (Attachment 1). The interim L e a s e a n d Management Agreement (Agreement no. 2016-156), Amendment No. 1 and Amendment No. 2 to Interim Lease and Management Agreement are provided in Attachment 2.
An important exception to Council’s prior direction is included in the proposed lease amendment. The California Governor’s Office of Emergency Services (CalOES) approved a grant deadline time extension for the project to Apr il 1, 2023, however, they were unable to approve the requested extension to May 21, 2024, because the Federal Emergency Management Agency (FEMA) must approve any extensions that go beyond the overall grant period. Cal OES has submitted an extension re quest to FEMA and believes that it will be approved, however, there is still a po ssibility that FEMA may not grant additional time.
2 Meeting Date: May 17, 2022
As a result, Public Works has reviewed the project timeline to provide for a continency plan if the grant extension is not received. In order to start and complete the project by the CalOES deadline, construction would need to begin by approximately October 1, 2022. The timeline for completion of the project would be much tighter, meaning that the building should be emptied and readied to go by approximately September 1, 2022. Also, we would not have as much flexibility to stage work to minimize disruption in and around the building. However, staff feel s that these alterations to the project schedule may be needed in order to retain the project funding and complete the project.
In light of this, the proposed lease extension includes a reser vation of rights by the City to earlier terminate the lease on or after August 1, 2022, by giving 30-days written notice to the GVCC as needed in order to make the necessary seismic improvements in compliance with funding deadlines.
Staff met with the GVCC to explain the contingency language and the GVCC still wishes to extend the lease.
FISCAL IMPACTS:
Extending the GVCC lease for an additional six months to December 31, 2022 would lead to the City managing the Center for just six months of Fiscal Year 2022-23,. As a result, the City’s FY 2022-23 budget will only reflect revenues and expenditures for the period of January 1, 2023 – June 30, 2023. Specifically, Staff estimates that under City management, Community Center revenues would be approximately $1 91,940 and expenditures would be $299,191 resulting in a General Fund subsidy of approximately $127,250 in the second half of FY 2022-23. Should earlier assu mption of GVCC management be necessary to meet grant funding construction timelines, staff would return to Council with a related budget adjustment request at that time.
ALTERNATIVES:
In addition to the recommendation above, the City Council could choose to not extend the agreement and go to a month-to-month lease, or let the lease expire on June 30, 2022.
Reviewed By: Legal Review By: Approved By:
___________________ ___________________ _________________ Kristine Schmidt Megan Garibaldi Michelle Greene
Assistant City Manager City Attorney City Manager
ATTACHMENTS:
1. Proposed Amendment No. 3 to Interim Lease and Management Agr eement – 6 Month Extension
3 Meeting Date: May 17, 2022
2. Interim Lease and Management Agreement (Agreement no. 2016-1 56), Amendment No. 1 and Amendment No. 2 to Interim Lease and Manage ment Agreement
4 Attachment 1
Proposed Amendment No. 3 to Interim Lease and Management Agreem ent – 6 Month Extension
5 City of Goleta
Amendment No. 3 to Agreement No. 2016-156
AMENDMENT NO. 3
TO AN INTERIM LEASE AND MANAGEMENT AGREEMENT
BETWEEN THE CITY OF GOLETA
AND
GOLETA VALLEY COMMUNITY CENTER
This Amendment No. 3 to an INTERIM LEASE AND MANAGEMENT AGREEMENT by and between the City of Goleta, a municipal corporation ("City") andGoleta Valley Community Center, a California nonprofit corporation ("Lessee") dated January 30, 2017 ("Agreement," Agreement No. 2016-156) is made this 17th day of May 2022.
SECTION A. RECITALS
1. The Agreement was entered into to allow Lessee to operate the Goleta Community Center at 5679 Hollister Avenue ("Property"), owned b y City, for recreational, literary, scientific, and educational purposes; and
2. This Agreement has been amended to extend the term to January 3 0, 2020 (Amendment No. 1); and
3. This Agreement has been amended to extend the term to June 30, 2022 (Amendment No. 2); and
4. The Agreement currently provides in Section 2A for the termination of the Agreement on June 30, 2022; and
5. The parties desire to amend the Agreement so as to extend the termination of the Agreement to December 31, 2022 with the right to earlier termination by the City in order to make necessary improvements for seismic, earthquake and other purposes; and
6. The City Council approved this Amendment No. 3, on this 17th day of May 2022.
SECTION B. AMENDED TERMS
Now therefore City and Lessee agree as follows that the Agreement be, and hereby is, amended as follows:
1. Section 2A is amended to read in its entirety:
"The term of the Agreement is from the Effective Date (January 30, 2017) to December 31, 2022 with a reservation of rights by the City to earlier terminate by giving 30-days written notice in order to make necessary seismic, earthquake,
6 City of Goleta
Amendment No. 3 to Agreement No. 2016-156
and other improvements in compliance with funding deadlines for such improvements. In no event shall the term expire earlier than August 1, 2022"
7 City of Goleta
Amendment No. 3 to Agreement No. 2016-156
2. Except as otherwise specifically provided herein, all other provisions of the Agreement shall remain in full force and effect
In concurrence and witness whereof, this Amendment No. 3 has been executed by the parties effective on the date and year first above writt en.
CITY OF GOLETA LEESEE
GOLETA VALLEY COMMUNITY CENTER
Michelle Greene, City Manager Bri an Larinan, GVCC Board Chair
ATTEST:
Deborah Lopez, City Clerk
APPROVED AS TO FORM:
MEGAN GARIBALDI, CITY ATTORNEY
Winnie Cai, Assistant City Attorney
8 Attachment 2
Interim Lease and Management Agreement (Agreement no. 2016-156), Amendment No. 1 and Amendment No. 2 to Interim Lease and Management Agreement
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