MEMORANDUM OF UNDERSTANDING
BETWEEN THE CITY OF COSTA MESA AND
THE CITY OF NEWPORT BEACH
This MEMORANDUM OF UNDERSTANDING (" Agreement") is dated as of December 15, 2020 (" Effective Date"), and entered into by and among the City of Costa Mesa, a municipal corporationorganizedandexisting underCalifornia law (" Costa Mesa") and the City of Newport Beach, which is a California charter city (" Newport Beach"), ( cumulatively the Parties," and at times individually a " Party"), with reference to and in consideration of the following:
WHEREAS, like manyother regionsin California, the County of Orange ("County") has seen a rapid growth in the homeless population over the past several years, a condition that has been difficult to address given the high cost of housing and property in the area; WHEREAS, as a result, local jurisdictions throughout the County have experienced increasedincidentsof unlawful campingand loitering activities in and upon portions of public propertyincluding, but not limited to, publicrights-of-way, parks, andotherpublic facilities Public Property") in violation of local ordinancesincluding, but not limited to, anti -camping, anti -loitering, and/or park closure ordinances and regulations (" Anti -Camping Ordinances"); WHEREAS, the useof Public Propertyin this mannercreateshealthand safetyrisks to homeless persons due to traffic hazards, exposure to weather, inadequate sanitation, and other conditionsdetrimentalto their wellbeing, and negativelyimpactsthe health, safety, andgeneral welfareof thecommunityby degradingtheenvironmentalandphysicalconditionof suchPublic Property, increasingrisksassociatedwith publichealthissues, andimpactingthepublicpurpose for which such Public Property is dedicated;
WHEREAS, on a broaderscale, the County is a complexjurisdiction of interconnected systems, manyof whichhavebeenimpactedby thehomelesscrisisin theregion, including, but not limited to, health care, criminal justice, social services, public transportation, as well as economic, social, legislative and political systems;
WHEREAS, in efforts to addressthis crisis, the County establishedan integratedSystem of Care to guide homeless individuals and families through acomprehensive array of services and housingdesignedto preventandendhomelessness;
WHEREAS, to better coordinate access points, assessments, resources, and programs servingpersonsexperiencinghomelessness, theSystemof CaredividedtheCountyintothree (3) geographic " Service Planning Areas" ( or " SPAs"), with the " Central Service Planning Area" Central SPA") includingthecitiesof CostaMesa, GardenGrove, FountainValley, SantaAna, Seal Beach, Westminster, Newport Beach, Huntington Beach, and Tustin; WHEREAS, on September 4, 2018, the United States Court of Appeals for the Ninth Circuit issued its decision in Martin v. City of Boise (" Boise Decision"), holding "[ t] hat ... as long asthereis no optionof sleepingindoors, the governmentcannotcriminalizeindigent, homelesspeoplefor sleepingoutdoors, on public property, on thefalsepremisethey hada choice
ATTACHMENT C
in the matter.";
WHEREAS, on January 29, 2018, a legal action captioned Orange County Catholic Worker et al. v. Orange County et al., was filed in United States District Court, Central District of California as Case No. 8: 18- cv- 00155 ( the " Action"), against the County, the City of Anaheim, Costa Mesa, and the City of Orange (cumulatively " Defendants"), alleging that, pursuant to the Boise Decision, Defendants' enforcement of their local Anti - Camping Ordinances against homeless persons was unconstitutional given the lack of accessible overnight shelter beds available to serve the homeless population within their respective jurisdictions; WHEREAS, on March 4, 2019, Costa Mesa entered into a settlement agreement in the Action by which it committed to create62 shelterbedsin the City of CostaMesa ("Settlement Agreement");
WHEREAS, on April 5, 2019, Costa Mesa opened a temporary shelter at the Lighthouse Church with 50 beds, which combined with 12 crisis stabilization unit beds at College Hospital in the City of Costa Mesa met Costa Mesa' s obligations under the Settlement Agreement; WHEREAS, onApril 9, 2019, CostaMesaclosedescrowon realpropertyat 3175Airway Avenue, in the City of Costa Mesa (" the Property" as more fully described in section 2.10) for 6,925,000 for the purpose of developing a permanent shelter in the City of Costa Mesa (" the Shelter");
WHEREAS, Costa Mesa has allocated $ 1.9 million of CDBG funds to the Shelter Capital Improvement Program (" CIP") Project and has submitted a grant proposal to County of Orange Continuum of Care (" CoC") in responseto a Requestfor Information in February2020 for the Homeless Housing Assistance Program ( HHAP) State funding - CoC allocation in the amount of 2,529,126. CostaMesaanticipatesthat this applicationmay not be fundedat the amountof the full request;
WHEREAS, Costa Mesa has processedthe necessaryentitlements and permitting, including compliancewith the California Environmental Quality Act (" CEQA"), designed and awarded a contract to construct improvements required to redevelop the Property into a permanent 70 bed homeless shelter (" Project"). Day- to-day operations have been contracted out to an experienced third party service provider (" Operator"); WHEREAS, 12,285 squarefeet of the structurelocatedon the Propertywill be usedfor the Shelter, which is currently under construction;
WHEREAS, CostaMesaintendsfor the Shelterto provide temporary shelterand social services assistance with a " housing first" model of operation. The goal is to assist individuals experiencinghomelessnessby providing themwith temporaryshelterwhile working with aclient case manager to create and follow through on a housing plan that seeks to find permanent supportive housing as soon as possible;
2 WHEREAS, in furtheranceof the health, safety, andwell-being of all their residents, to return and preserve Public Property for its intended purpose, the Parties, located within the Central SPA, have worked together cooperatively and in good -faith towards developing a regional solution to the current homeless crisis;
WHEREAS, Newport Beach is committed to a regional solution to address homelessness and, assuch, has expressed a desire to partner with Costa Mesa to provide funding to develop and operate the Shelter and to support Costa Mesa in seeking funding to assist in financing the acquisition, construction, and operation of the Shelter, as provided herein, in exchange for use of up to 20 beds in the Shelter;
WHEREAS, thePartiesdesireto memorializethetermsandconditionsby which Newport Beach will provide funding to support the build out and operation of the Shelter and to agree on how Shelter beds will be accessible for Newport Beach; certain aspects of Shelter governance; how the Parties will share access to the capacity- provided by the Shelter; how the Parties will share the costs and responsibilities associated with the acquisition, construction, operation, and maintenance of the Shelter; and other related matters in furtherance of their common purpose; WHEREAS, in addition to addressing the needs of homeless persons through the provision of overnight shelter, the Parties are committed to increasing the inventory of long- term affordable andsupportivehousingunits, suchthathomelesspersonsreceivingservicesunderthisAgreement may transition from emergencyshelterfacilities, andinto long-termandstablehousingsolutions; and
WHEREAS, each Party has caused this Agreement to be duly approved by its respective governing body, andby so doing, has found and determined that this Agreement furthers the health, safety, and general welfare of their respective residents.
NOW THEREFORE, in consideration of the mutual covenants and conditions contained herein, andother good andvaluableconsideration, the receiptand adequacyof which are hereby acknowledged, the Parties agree as follows:
AGREEMENT
1. PURPOSE
This Agreement establishesa memorandumof understandingfor establishing, constructing, developing, maintaining, providing, operating, and facilitating the provision of temporary housingin theShelter, andtheprovision of certainservicesto homelessandchronically homeless adults located within the boundaries of the Parties. This Agreement defines the respective rights and responsibilities of the Parties with respect to the financing, implementing, operating, and the provision of Services, as defined in Section 2. 14, at the Shelter. 3 2. DEFINITIONS
In additionto theothertermsandphrasesdefinedelsewherein this Agreement, the following key capitalized terms and phrases used throughout this Agreement shall have the meaning assigned in this Section.
2. 1. " Case Management Plan" shall mean the individual plan for each Shelter Resident that, among other things, sets forth details how the Shelter Resident can reach the goal of obtaining long- term stable housing.
2. 2. " FF& E" shall have the meaning ascribed in Section 4.2.
2. 3. " Managementand OperationsPlan" shall meanand refer to the plan approvedby CostaMesaandthe ShelterOperator, which detailstheterms, conditions, andstandardsbywhich Services are made available to Shelter Residents at the Shelter and shall require Services to meet or exceed industry standards.
2. 4. " Newport BeachCapitalPayment" shall havethe meaningascribedin Section4.1.
2. 5. " Newport BeachFF&E Payment" shall havethe meaningascribedin Section4.2.
2. 6. " Operating Agreement" shall mean and refer to the contract between Costa Mesa and the Shelter Operator for the operation of the Shelter.
2. 7. " Party Representative" shall mean and refer to the highest- ranking appointed executiveofficial for eachof theParties, or his/or herduly authorizeddesignee.
2. 8. " Program" shall meanandreferto theParties' cooperativefinancing andplanning for the acquisition, construction, operation and the provision of Services at the Shelter.
2. 9. " Program Area" shall mean and refer to the CentralService Planning Area of Orange County, California.
2. 10. " Property" shall mean the approximately 29,816 square foot building on a 1.34 acre parcel, located at 3175 Airway Avenue, Costa Mesa, CA ( A. P.N. 427- 091- 12).
2. 11. " Project" shall have the meaning ascribed in the Recitals above.
2. 12. " Project Commencement" shall mean when the Project is fully operational such that all Servicesare being offered and available for Residentsreferred to the Project by both Parties.
2. 13. " ResidentTransportation" shall meanthe meansby which eachPartyshall arrange for its respective Shelter Residents to be transported from and to the Shelter and for appointments related to their Case Management Plan.
2. 14. " Services" shall mean and refer to the provision of overnight shelter and other sanitation, nutritional, health, educational, supportive, and/ or basic human services at the Shelter, as described in the Management and Operations Plan.
2. 15. " Service Commencement Deadline" shall mean December 31, 2021, the deadline for the Shelter to be fully operational.
2. 16. " Shelter Advisory Committee" shall mean any committee formed with local stakeholdersto provide review of Shelteroperations, enhancecommunity relations, andprovide informationto theneighborhoodsurroundingtheShelter, local businesses, theParties' respective staff or City Council of either Party, and Shelter Operator and service providers.
2. 17. " ShelterOperator" shallmeanandreferto anexperiencedandqualified third -party contractedby CostaMesato provide comprehensiveand "turnkey" day-to-day managementand operation of the Shelter.
2. 18. " ShelterResidents" shall mean and refer to homelessand chronically homeless adults located within the Program Area who receive services and reside at the Shelter.
2. 19. " Up -Front Costs" shall mean the Newport Beach Capital Payment and Newport Beach FF& E Payment.
3. TERM
3. 1. General Term. This Agreement shall be effective as of the date which the last of the Parties has executed the same, which shall be inserted as the Effective Date in the first paragraph above, and shall remain in full force and effect for five ( 5) years, until December 15, 2025, with two optional extension terms of five ( 5) years each (" the Term"). Options to extend shall be implementedat least 90 days prior to the then -scheduledexpiration date by mutual agreementof thePartiesin writing, which extensionmay beapprovedby theauthority of theCity Manager of each Party; provided there is no material change of terms for such extended Term.
This Agreement may be earlier terminated in accordance with the provisions of this Agreement.
3. 2. Termination by Parties. If either of the following occur: ( i) a Judge determines that Newport Beach cannot enforce any Anti -Camping Ordinances in its jurisdiction because providing shelter to persons experiencing homelessness in Costa Mesa, pursuant to the terms of this Agreement, doesnotprovidecredit to Newport Beachfor theprovision of twenty (20) shelter beds, or (ii) the Project Commencement doesnot occur by the Service Commencement Deadline, exceptasprovided in Section9.4 hereof, andCostaMesahasnot curedthis default after having beenprovided notice thereof and an opportunity to cure, then Newport Beach may, in its sole discretion, terminate this Agreement by giving ninety ( 90) days written notice to Costa Mesa of its intent to terminatethe Agreement. If the Agreementis terminatedduring the initial five (5) year term underSubsection3.2 (i), Newport Beachshall recoupa pro ratashareof its Up -Front Costs paid pursuant to Sections 4. 1 and 4. 2 below. If the Agreement is terminated under Subsection3.2 (ii) of this provision, Newport Beachshall recoupall of its Up -Front Costspaid pursuant to Sections 4. 1 and 4.2 below. If such termination occurs after the initial five ( 5) year Term, no Up -Front Costs will be refunded to Newport Beach.
3. 3. Termination for Default. Upon the occurrence of any default, and following written notice and expiration of the time to cure as provided in Section 7. 1 herein, the non - defaulting Party may, at its option declare this Agreement null and void with respect to the defaulting Party, in which casethe defaulting party shall not be entitled to the benefits and privileges of this Agreement or the Program following termination. Nothing herein shall be construedas the non -defaulting Party's exclusive remedy for the remediation of default by a Party, and the non -defaulting Partyreservesthe right to pursueany and all available rights and remedies at law or in equity.
3. 4. Liquidated Damages. If the defaulting Party is Newport Beach, Costa Mesa shall retain all of the funds paid by Newport Beach up to the date of Termination for Default as liquidated damages. If the defaulting Party is Costa Mesa, Costa Mesa shall refund to Newport Beach any and all funds contributed by Newport Beach for any time period in which Newport Beach was unable to use its allocation of Shelter beds due to Costa Mesa' s default; and, if the Termination for Default occurs in the initial five ( 5) year Term, Newport Beach will also be entitled to: ( i) a pro rata refund for any of its Up -Front Costs paid in connection with this Agreement, if the Shelteris openby the ServiceCommencementDeadline; or (ii) all Up -Front Costs paid in connection with this Agreement if the Shelter is not open by the Service Commencement Deadline, except as provided in Section 9.4 hereof, and Costa Mesa has not cured this default after having beenprovided notice thereof and an opportunity to cure. The Parties acknowledge and agree that the retention and refunding of funds provided for in this Section shall constitute liquidated damages and not penalties and are in addition to all other rights of the Parties, including the right to call a default of this Agreement. The Parties further acknowledge that: ( i) the amountof loss, costs, or damageslikely to be incurredby thePartiesresulting from a Party's default which leads to terminating this Agreement before the end of the Term, is incapable or is difficult to precisely estimate; ( ii) the funds to bepaid to or retainedby thenon -defaultingParty bearsa reasonablerelationshipto, and is not plainly or grosslydisproportionateto, theprobable lossesor costs likely to be incurred by the other Party by virtue of a Party's defaultleadingto termination of this Agreement before the end of the Term; ( iii) one of the reasons for the Parties reaching an agreement asto suchamounts is the uncertainty regarding the question of actual losses, costs, or damagesto be incurred by the Parties in such event; and (iv) the Parties are sophisticated businessparties, have been representedby sophisticated and able legal counsel, and have negotiated this Agreement at arm' s length.
3. 5. Continuing Enforceability. Following the effective date of termination, the Parties shall have no further obligations or rights with respect to this Agreement, except as expressly provided otherwise herein.
4. NEWPORT BEACH' S OBLIGATIONS.
4. 1 Newport Beach Capital Contribution. Newport Beach shall contribute One Million Four Hundred Thousand Dollars ($ 1, 400, 000) (" Newport Beach Capital Payment") in Capital Improvement Costs on a one time basis to support the development of the Project. Newport Beachshall pay to CostaMesathe Newport BeachCapital Paymentwithin thirty (30) daysof the Effective Date. This Newport Beach Capital Payment is not contingent upon the outcome of the G
Costa Mesa HHAP grant application/ award; provided that Costa Mesa shall not be relieved of its obligations under this Agreement if the HHAP grant or any other grant sought by Costa Mesa is delayed, not funded in its entirety or denied.
4. 2 Newport Beach Contribution for Furniture, Fixtures and Equipment.
Newport Beach shall make a one- time contribution of Two Hundred Thousand Dollars ($ 200, 000) ten thousand dollars [$ 10, 000] per bed to which it has use rights as provided for herein) (" Newport Beach FF& E Payment") for thepurposeof purchasingfurniture, fixtures andequipmentincluding, beds, desks, mattresses, linens, indoor and outdoor storage equipment, office equipment, tables, chairs, kitchen supplies, and the like (" FF& E"). Costa Mesa shall be solely responsible for paying all othercostsfor any andall FF&E, asmay benecessaryor desirablefor the Projector provision of Services.
4. 3 Newport Beach Annual Contribution for Operations Costs. Upon Project Commencement, Newport Beach shall be obligated to pay an annual operational cost of One Million Dollars ($ 1, 000, 000) (" Newport Beach Operations Payment"), with Newport Beach OperationsPaymentto be madein four quarterly installments, within thirty ( 30) daysof the end of each quarter, prorated for the first operational quarter, which is specifically to provide for operational costs of Fifty Thousand Dollars ($ 50, 000) per bed to which Newport Beach has use rights as provided for herein, for the initial Term of the Agreement, and optional term extensions, if mutually agreed to by the Parties, subject to annual increases as provided in Section 4.4 hereof.
The Parties expressly agree that Newport Beach shall not be liable for any operational costs prior to the date the Shelter is fully operational and open to Newport Beach for the housing of Shelter Residents. Newport Beach shall be obligated to make its annual Newport Beach Operations Payment regardless of the level of use of the beds to which it has use rights.
4. 4 CPI Increase. Commencing one year following the approval date of this Agreement, there shall be an annual increase in the Newport Beach Operations Payment. The annual Newport Beach Operations Payment will be increased following the month of the one year anniversary of this Agreement, and eachyear of the Term thereafter, by the percentage increase in the Consumer Price Index for the preceding twelve month period. For purposes hereof " Consumer Price Index" shall mean the Los Angeles -Long Beach -Anaheim Consumer Price Index for All Urban Consumers ( CPI - U); provided, however, the annual contribution shall increase by a minimum of 2% and a maximum of 4%.
4. 5 Newport Beach Outreach. Newport Beach shall assign a designated staff member as the main point of contact for all Shelter related items, who will participate in the monthly Homeless Solutions Collaborative meetings. Newport Beach reserves the right to amend the designated staff member; provided Newport Beach shall give Costa Mesa prior written notice of any new designee. Newport Beach outreach providers shall provide potential client referrals to CostaMesa's NeighborhoodImprovementManager/ShelterOperatorto confirm bed availability and acceptance. Newport Beach will coordinate outreach within its jurisdiction and provide transportation to the shelter.
4. 6 Resident Transportation. Unless the Parties expressly agree on an alternative plan for the provision of ResidentTransportationto ShelterResidentsreferredby Newport Beach, Newport Beach shall separately provide for all Resident Transportation for Shelter Residents 7 referredby Newport Beachfor thedurationof their stayat the Shelterandfor their departurefrom theShelter. Newport Beachshallberesponsiblefor maintainingcontactwith the ShelterOperator to ensureappropriatetransportationfor Newport Beachreferrals is provided timely to assistin working toward satisfaction of their Case Management Plan.
4. 7 Allocation of Beds. Newport Beach will work collaboratively with Costa Mesa to ensure the Central SPA cities are coordinating with the County and that the shelter beds addressed in this Agreement are prioritized to meet the greatest needs of both Parties, with 50 beds for Costa Mesa' s use and 20 beds for Newport Beach' s exclusive use for its referrals. The Parties expresslyagreethat it is the Parties' intent to transition Shelter Residentsto long-term stable housingandNewport Beach's consentshall be requiredto continueto houseany personreferred by Newport Beach at the Shelter for more than six ( 6) months.
4. 8 No Subletting. Subletting of Beds will not be allowed. Newport Beach shall be allocateduseof 20 bedsfor Newport Beachto refer homelessindividuals deemedby Newport Beachto be highestpriority personsreferredto the Projectby Newport Beachover time.
5. 0 COSTA MESA OBLIGATIONS
5. 1 Acquisition, Construction and Furnishing Shelter. CostaMesahasor will pay for all costsassociatedwith acquisition of the Property, constructionto reconfigure the Property for use, including but not limited to removal of the existing improvements, design/entitlements/permitsrequiredandforconstructionof all improvements, aswellasobtaining and installing all FF&E. Notwithstanding any of Newport Beach's contributions or paymentsas providedfor in this Agreement, CostaMesashall own the Property, all improvements, the Shelter and all FF& E installed therein. The Shelter itself shall be utilized exclusively for purposes consistent with this Agreement, and/or the terms and conditions of the Community Development Block Grant (" CDBG") or other funding which may be used by Costa Mesa for the Shelter or the Program.
5. 2 Operation of Shelter. CostaMesashall act asthe leadagencywith respectto the operation of the Shelter. CostaMesa shall provide to Newport Beach a copy of the Operating Agreement and Management and Operations Plan, which provides the Standards of Care for the Program, which meet or exceed industry standards. Costa Mesa shall ensure that Shelter Residents referred to the Shelter by either Costa Mesa or Newport Beach shall receive the same level of Services, as provided for in the Operating Agreement and Management and Operations Plan, except where expressly excluded in this Agreement such as the obligation of Newport Beach to provide Resident Transportation to Shelter Residents it refers to the Project.
5. 3 Intake. Costa Mesa shall maintain oversight of the Shelter intake clearance process for a reservationat the Shelter, which requiresclearanceby either Party's Police Departmentor the Neighborhood Improvement Manager/ Designee. Entry will not be approved for individuals with anactivefelony warrant, who area registeredsexoffenderand/or havebeenconvictedof any arson offense, as reflected on their background check. as confirmed by Costa Mesa Police Department or Newport Beach Police Department prior to entry. 8 5. 4 Shelter Resident Outcomes. The Parties agree to cooperate to build a system where outcomesrelated to family unification, employment opportunities, affordable housing placement and services for subpopulations ( veterans, domestic violence, seniors and youth) are addressed through connections to the broader Countywide System of Care. The Parties agree that suchsystemshallincludeprovisionsto excludeall non -emancipatedminorsfromutilizinganyof the Services or being housed at the Shelter.
5. 5 Modifications to Shelter. Prior to commencement of construction of any future significant modifications or improvements to the Shelter, Newport Beach will be provided a reasonable opportunity to review and provide input on the proposed design and amenities of the modifications or improvements, and Costa Mesa will, in good faith, consider the input of Newport Beachin finalizing the same; providedthat if Newport Beachcontributesfunding for suchfuture modifications or improvements, Newport Beachshall retain authority to approvethe designand amenities of the modification or improvements.
5. 6 ServiceContracts. CostaMesawill be the "contractingparty" to any written agreements with qualified professional ( s), service providers, and/ or licensed contractor( s) Consultant") necessary for the development or operation of the Shelter consistent with this Agreement.
5. 7 Procurement Practices. Costa Mesa shall follow its own procedural formalities and requirementsfor services, purchasesandacquisitionsrelating to the Propertyandthe Shelter.
5. 8 Provision of Documents. Costa Mesa agrees to provide all relevant documents relatedto the OperatingAgreement, ManagementandOperationsPlan, andoperatingcostsof the Shelter, within forty five (45) daysof requestfrom Newport Beach. With respectto anyadditional documents, besidestheaforementioned, eachrequestwill beevaluatedonacasebycasebasisand may be provided at an additional administrative cost.
6. JOINT OBLIGATIONS
6. 1 Grants and other Third Party Funding. The parties shall work together in regional alignment on any applications for local, state, and federal funding. As the permanent Shelteron the Propertyis ownedandoperatedby CostaMesa, CostaMesa will serveasthe lead agency, working in concert with Newport Beach, on all applications, requests and solicitations for federal, state and/or county funding and grant opportunities, loans, and subsidies related to all costs associated with the Shelter. Newport Beach agrees to cooperate in the grant application process by providing any datanecessaryto improve the chancesof securinggrant funding. The Parties will work together cooperatively to augment shelter operational enhancements whenever advantageous, with CostaMesaas leadapplicantendorsinggrantapplicationsandpartnerships.
For future OperatingGrantsand/or Funding Opportunities: If any of the aforementioned jointly solicitedgrantsorfinds arereceivedtohelpreimburseorsubsidizeannualrecurringshelter operational costs, each Party' s costs will be reduced by a commensurate pro rata share (71.43% to Costa Mesa and 28. 57% to Newport Beach).
I
For Capital Grantsand/or Funding Opportunities: If any of the aforementionedjointly solicited grantsor fundsarereceivedfor paymentor reimbursementof property acquisitionand/or tenant improvement costs associatedwith the Shelter, each Party will be reimbursed and participateon a GAAP FIFO accountingbasis (First In, First Out), with Newport Beachreceiving aproportionateshareof reimbursement/funding for theNewportBeachCapitalPaymentonly after all prior capital expenditures incurred by Costa Mesa, as described in the recitals hereof have been fully reimbursed.
Costa Mesa must participate, support and approve grant funding sourcesapplied to Shelter operations or costs associated with this Agreement.
This sectionshallnot apply to funds which areallocatedindividually to the Partiesunder SenateBill No. 2, CDBG or other grants allocatedto individual cities or funding commitments securedindependentlyby a Party.
6. 2 Security. CostaMesashall ensurethat adequatesecuritymeasuresandpolicies are incorporated into the operation of the Project. This includes the requirementthat entry to the Shelteris controlled by referral only, with no walk-up admission. Both Partiesshall ensuretheir outreachstaff provide cleardirection to potential ShelterResidentson requirementsfor accessing the Shelterand its services, including the prohibition of walk-ups. Newport Beachwill abideby any reasonableintakeproceduresandprotocolsestablishedby CostaMesa.
6. 3 Resident Transportation. Unless the Parties expressly agree on a plan for the provision of joint ResidentTransportationof ShelterResidentsper Section4.6, eachParty shall arrange for Resident Transportation of its respective Shelter Residents. Newport Beach shall be responsible to provide all security with respect to its Resident Transportation.
6. 4 Coordination with Central SPA Cities. The Parties agree to work together to engage other Central SPA Cities in coordinated outreach that refers homeless persons to the best resources to meet their needs based on residency. The cities within the Central SPA which have sheltersinclude: SantaAna, Tustin, Huntington Beach, andCostaMesa. TheCountyYale Shelter will also serve the Central SPA Cities.
6. 5 Long Term Housing. Consistent with the purposes of this Agreement, Newport Beach agreesto cooperate with Costa Mesa in providing for a regional solution to the unsheltered homelesspopulation within the ProgramArea, with the goal of transitioning ShelterResidents from theemergencyshelterto long-term housing.
6. 6 Community Coordination and Communication. The Parties are committed to communication with neighbors on an ongoing basis. During the Term, the Parties and the Shelter Operator will work together cooperatively and in good faith to facilitate the Shelter Advisory Committee, generate educational or outreach materials, and engage in similar activities to promote or further the purposes of the Program. The goal of such efforts will be to provide members of the community with opportunities to ask questions and receive information about the Shelter and the Program. Any printed or published materials relating to the Program shall be subject to approval by the Party Representatives.
a) Complaints / Inquiries. Any community complaints and/or inquiries about the Programshouldbe recordedand forwarded to the appropriateParty, or its designatedpoint of contact, for prompt investigation. The Party Representatives and Shelter Operator shall work together to facilitate appropriate responses to customer service requests and prompt resolution of community complaints.
b) Visitors / Tours. Visits by members of the community and tours of the Shelter Shouldbemadereasonablyavailableby CostaMesaandwill becoordinatedby andthroughCosta Mesa outreach staff and the Shelter Operator.
c) Coordination of Government Agencies. The Program will be operated for the public good, and successful implementation will require the partnership of various stakeholders including the Parties, the Shelter Operator, local school districts, and other local political subdivisions and community organizations. The Parties are, and the Shelter Operator shall be, committed to working cooperatively with numerous stakeholders to serve Shelter Residents in theProgramArea. The Partiesandthe Operatorwill communicateandwork collaborativelywith local healthcare, housing, social services, and public safety departmentsthrough all stagesof Program implementation, including but not limited to the implementation of the Management OperationsPlan and Operating Agreement, including ensuring compliance with intake and security procedures, implementationof Case ManagementPlans and placement in long term housing; however, Newport Beach shall have no obligations related to the Program not specifically addressed in the Operating Agreement, Management and Operations Plan and/or in this Agreement, unless expressly agreed to by Newport Beach.
6. 7 Cooperation. The Partiesagreeto cooperateto theextentnecessaryin connection with ongoing administrative, grant funding, regulatory, and/or litigation proceedings, other than the Action, and similar matters which affect both Parties to this Agreement.
7. DEFAULTS, AND REMEDIES
7. 1 Defaults.
a) Notice and Time to Cure. The failure by any Party to perform any of its obligations set forth in this Agreement shall constitute a default, except as provided in Section
9.4 hereof. Exceptasrequiredto protectagainstfurtherdamages, thenon -defaultingPartymay not institute legal proceedingsagainstthe Party in default until the non -defaulting Party has provided the defaulting Party notice of the default and the cure period has expired. The cure period for any default shall be thirty ( 30) calendar daysafter the defaulting Party's receiptof written notice from thenon -defaulting Party that suchobligation was not performed. In thecase of a defaultwhich cannotbecuredwithin the cureperiodssetforth in this Section, thedefaulting Party shall commenceefforts to cure within such time periods and shall diligently thereafter pursue to cure the default to completion within a reasonable period of time. b) Cooperative Resolution. During the cure period set forth in paragraph ( a), and prior to pursing any remedies described in this Section, the Parties will attempt, in good faith, to find a mutually agreeableresolution through communicatingwith eachother and attemptingto resolve any substantive problems arising under this Agreement, including challenges arisingfrom funding difficulties, and/or any difficulty with effectively implementing the responsibilities detailed in this Agreement. Communication and attempts to resolve such problems and difficulties prior to pursing remedies under this Agreement include, but are not limited to, meeting together, amending this Agreement, and/or seeking the assistanceof ajointly agreed upon mediator.
7. 2 Remedies. Upon the occurrence of any default, and following written notice and expiration of the time to cure, the non -defaulting Party may, at its option: declare this Agreement null andvoid with respectto the defaulting Party, in which casethedefaulting party shall not be entitled to the benefits and privileges of this Agreement or the Program; or pursue damages or specific performanceor other legal and equitableremediesthe injured Partiesmay haveagainst the non -defaulting Party in accordancewith applicablelaw. Nothing hereinshall be construedas thenon -defaultingParty'sexclusiveremedyfor theremediationof defaultby aParty, andthenon - defaulting Party reserves the right to pursue any and all available rights and remedies at law or in equity.
7. 3 Non -refund of Contributions. The paymentsmadeby all Partiespursuantto this Agreement shall be used for the Program in the manner described herein, and all Parties acknowledge and agree that the development, administration, and operation of the Program, including developmentof the Shelter, provides an immediatebenefit to eachParty and that no payments made pursuant to this Agreement shall be refunded for any reason other than as specifically authorized herein.
8. INDEMNITY AND INSURANCE
8. 1. Indemnity / Hold Harmless. Each Party shall hold harmless, indemnify, and defend the other Party, and its officers, employees, and agents, from and againstany and all claims, suits, or actionsof every kind brought for or on accountof injuries to or deathof any personor damageto any property of any kind whatsoeverand to whomsoeverbelongingto the extent causedby a Party's failure to fulfill any obligation of suchParty arising pursuantto the performance or nonperformance of the Party' s covenants and obligations under this Agreement, and/or which result from the negligent or wrongful act of the Party, or its officers, employees, or agents. This provision requiring a Partyto hold harmless, indemnify, and defendthe otherParty shall expresslynot apply to claims, losses, liabilities, or damagesarising solely from actionsor omissions, negligent or otherwise, of any independent contractor providing services pursuant to a contract with any other Party. In the event of concurrent negligence of the Parties, their respective officers, or employees, then the liability for any and all claims for injuries or damages to persons and/or property or any other loss or cost which arises out of the terms, conditions, covenants or responsibilities of this Agreement shall be apportioned in any dispute or litigation according to the California theory of comparative negligence. Costa Mesa, in contracting following the effective date of this Agreement with third parties for design, development, construction, equipping, maintenance and repair of the Property, and operation of any aspect of the Project, shall require full indemnification and hold harmlessclausesnaming all Partiesas provided for herein below. Newport Beach, in contracting following the effective date of this 12 Agreementwith anythirdpartiesrelatingto operationof anyaspectsof theProject, including, but not limited to, street outreach and transportation of Newport Beach referrals to and from the Shelter, shall requirefull indemnificationand hold harmlessclausesnamingall Partiesas provided for hereinbelow.
8. 2. Insurance. CostaMesashallinsurethePropertyandtheProject, andshallrequire any Consultants, contractorsor subcontractorsoperatingor performing work at the Property, or fortheProject, toholdpoliciesof insurancewithcoverageandlimitscommensuratewith industry standards and practices, which shall be agreed to by the Risk Managers of the Parties. Both Partiesand their respectiveofficers, employeesand agents shall be named insuredson any liability coverage. Each Party shall provide for Workers' Compensation coverage for its own employees. Each party shall obtain endorsements from its workers' compensation insurer waiving subrogationrights under its workers' compensationinsurancepolicy againstthe other and their respective officers, agents, employees, and volunteers arising from this Agreement and to require eachof its subcontractors, if any, to do likewise under their workers' compensation insurance policies.
8. 3. Insurance for Consultants. EachPartyshallrequireany Consultantsengagedby them in conjunction with this Agreementto obtain, maintain, and keep in full force and effect duringthe life of this Agreementall of thefollowing minimum scopeof insurancecoverageswith an insurance company admitted to do business in California, rated " A," Class X, or better in the mostrecentBest's Key InsuranceRating Guide, and approvedby eachParty's Risk Manager:
a) Commercial general liability, including premises -operations, products/ completed operations, broad form property damage, blanket contractualliability, independentcontractors, personal injury or bodily injury with a policy limit of not less than One Million Dollars 1, 000, 000. 00), combined single limits, per occurrence. If such insurance contains a general aggregatelimit, it shall apply separately to this Agreement or shall be twice the required occurrence limit.
b) Business automobile liability for owned vehicles, hired, and non -owned vehicles, with a policy limit of not less than One Million Dollars ($ 1, 000, 000. 00), combined single limits, per occurrencefor bodily injury andproperty damage.
C) Workers' compensation insurance as required by the State of California.
Consultants shall be required to waive, and to obtain endorsements from their workers' compensationinsurer(s) waiving subrogationrights undertheir workers' compensationinsurance policy(ies) againsteachParty, its officers, agents, employees, andvolunteersarising from work performed by Consultantfor the Party and to require eachof its subcontractors, if any, to do likewise under their workers' compensation insurance policies. d) Professional errors and omissions (" E& O") liability insurance with policy limits of not less than One Million Dollars ($ 1, 000, 000. 00), combined single limits, per occurrence and aggregate. Architects' andengineers' coverageshall beendorsedto includecontractualliability.
If the policy is written asa "claims made" policy, the retro dateshall be prior to the startof the contractwork. Consultantsshallobtainandmaintain, saidE&O liability insuranceduring thelife of the Agreement and for three years after completion of the work thereunder. 13 C) In addition, the Shelter Operator shall be required to provide Sexual abuse/ molestation coverage with limits of not less than One Million Dollars ($ 1, 000, 000. 00) per occurrence and Two Million Dollars ($ 2, 000, 000. 00) in the aggregate and Cyber liability insurance with policy limits of not less than One Million Dollars ($ 1, 000, 000. 00) per occurrence and Two Million Dollars ($ 2,000,000.00) in the aggregate covering: ( i) all acts, errors, omissions, negligence, infringement of intellectual property; ( ii) network security and privacy risks including, but not limited to, unauthorizedaccess, failure of security, breachof privacy perils, wrongful disclosure, collection, or negligencein thehandlingof confidential information, privacy perils including coverage for related regulatory defense and penalties; and ( iii) data breach expenses payable whether incurred by the Parties or Shelter Operator including, but not limited to, consumer notification, whether or not required by law, computer forensic investigations, public relationsandcrisis managementfirm fees, credit file or identity monitoring or remediation services in the performance of services for Costa Mesa and/ or Newport Beach. f) Endorsements. Unless otherwise agreed to by the Parties, all insurance referred to in this section8.3 shall containor be endorsedto containthe following provisions:
i) Additional insureds: " The City of Costa Mesa and the City of Newport Beach and their elected and appointed boards, officers, officials, agents, employees, and volunteers are additionalinsuredswith respectto: liability arisingout of activitiesperformedby or onbehalf of the Consultant pursuant to its contract with the respective city; products and completed operations of the Consultant; premises owned, occupied or used by the Consultant; automobiles owned, leased, hired, or borrowed by the Consultant." This endorsement requirement does not apply to Professional Errors and Omissions insurance required by subsection ( d) of this section 8. 3.
ii) Notice: " Said policy shall not terminate, be suspended, or voided, nor shall it be cancelled, nor the coverage or limits reduced, until thirty ( 30) days after written notice is given to the City of Costa Mesa and City of Newport Beach." iii) Other insurance: " The Consultant' s insurance coverage shall be primary insurance as respects the City of Costa Mesa, the City of Newport Beach and their officers, officials, agents, employees, and volunteers. Any other insurance maintained by the City of Costa Mesa or the City of Newport Beach shall be excess and not contributing with the insurance provided by this policy."
g) Any failure to comply with the reporting provisions of the policies shall not affect coverage provided to Costa Mesa, Newport Beach, or their respective officers, officials, agents, employees, and volunteers.
h) The Consultant' s insurance shall apply separately to each insured against whom claim is madeor suit is brought, exceptwith respectto the limits of the insurer's liability. i) Deductible or Self Insured Retention. If any of such policies provide for a deductible or self- insured retention to provide such coverage, the amount of such deductible or self- insured retentionshall beapprovedin advanceby thecontractingParty. No policy of insuranceissuedas 14 to which the Parties are an additional insured shall contain a provision which requires that no insuredexceptthenamedinsuredcansatisfyany suchdeductibleor self-insuredretention.
8. 4. Certificates of Insurance. Consultantsshallberequiredto provide to eachParty certificates of insurance showing the insurance coverages and required endorsements described above, in a form andcontentapprovedby the Parties, prior to performing any servicesunderthe agreement. The certificates of insurance shall be attached to any Consultant agreement.
8. 5. Non -limiting. Nothing in this Sectionshall beconstruedaslimiting in anyway, theindemnificationprovision containedin this Agreement, or theextentto which anyConsultants contracted by either Party may be held responsible for payments of damages to persons or property.
9. MISCELLANEOUS
9. 1. Approval by Party Representatives. Any term or provision of this Agreement that callsfor thedirection, approval, or consentof thePartiesor PartyRepresentatives, shallmean andreferto the direction, approval, or consentof bothof thePartyRepresentatives; providedthat, notwithstanding anything contrary in this Agreement, Costa Mesa shall have sole discretion to approveor disproveanysuchactionthat: directly relatesto theoperation, management, capacity, construction, location, design, or scaleof the Shelter, so long asNewport Beach's ability to use its allocatedbedsis not unreasonablyimpairedthereby; or anyotheraction that, in CostaMesa's reasonable discretion, will have a reasonably foreseeable negative material impact on residents, business, or public facilities in the areasurroundingthe Shelter, materially increasethe intensity of Shelter use or capacity, or materially increase burdens on public services provided to said area.
Except as specifically provided herein, all actions reasonably necessary to effectuate the purpose of this Agreementandthe Programmaybeperformedby thePartyRepresentativesexceptasmay otherwise be prohibited by state or federal law.
9. 2. Notice. Any notice, demand, request, document, consent, approval, or communicationeither Party desiresor is required to give to the other Party or any other person shall be in writing and either served personally or sent by prepaid, first- class mail to the person(s) at the address below. Either Party may change its address by notifying the other party of the changeof addressin writing. Notice shall be deemedcommunicatedat the time personally delivered or in seventy-two ( 72) hours from the time of mailing if mailed as provided in this Section.
CITY OF COSTA MESA
Lori Ann Farrell Harrison
City Manager
77 Fair Drive
Costa Mesa. CA 92626
15 CITY OF NEWPORT BEACH
Grace K. Leung
City Manager
100 Civic Center Drive
Newport Beach, CA 92660
With a copy to:
Kimberly Hall Barlow
City Attorney
3777 N. Harbor Blvd.
Fullerton, CA 92835
Aaron C. Harp
City Attorney
100 Civic Center Drive
Newport Beach, CA 92660
9. 3. Parties as Independent Contractors. Each Party is, and at all times shall be deemedto be, anindependentcontractorasto theotherParty. Nothing hereinis intendedor shall be construed as creating the relationship of employer and employee, or principal and agent, betweenany Party, or any Party's agentsor employees. EachParty shall retain all authority for rendition of services, standards of performance, control of personnel, and other matters incident to the performance of the Program pursuant to this Agreement. Each Party, and its agents and employees, shallnot beconsideredto beemployeesof anyother Party.
9. 4. Force Majeure. In no event shall either Party be responsibleor liable for any failure or delayin theperformanceof itsobligationshereunderarisingout of orcausedby, directly or indirectly, forces beyond the control of the party obligated, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, epidemic, and interruptions, loss or malfunctions of utilities, communications or computer ( software and hardware) services; it being understood that the Parties shall each use reasonable efforts to resume performance as soon as practicable under the circumstances.
9. 5. Survival of Terms at Termination. The provisions of sections 3. 4, 7. 1- 7. 3, 8. 1,
8. 2, 8. 5, 9. 2, 9. 4- 9. 10, and 9. 12 shall survive the termination of this Agreement.
9. 6. Governing Law and Venue. This Agreement has been negotiated and executed in the State of California and shall be governed by and construed under the laws of the State of California. In the event of any legal action to enforce or interpret this Agreement, the sole and exclusivevenueshallbe a court of competentjurisdiction, locatedin OrangeCounty, California, andthePartiesagreeto andherebysubmitto thejurisdiction of suchcourt, notwithstandingCode of Civil ProcedureSection394. Furthermore, the Partiesspecifically agreeto waive any and all rights to request that an action be transferred for trial to another county.
9. 7. Amendments / Entire Agreement. Amendments to this Agreement must be in writing and approved by the governing body of each Party. This Agreement, and the various Exhibits referenced herein which are incorporated fully by this reference, is the entire agreement among the Parties with respect to the subject matter hereof; and it supersedesany prior written or oral agreements with respect to the subject matter.
9. 8. Severability. If any section, subsection, paragraph, term, or provision of this Agreement, or the application thereof, is held by a court of competent jurisdiction to be invalid, void or unenforceable, such section, subsection, paragraph, term, or provision. to the extent the sameisvalid andenforceable, andall otherremainingprovisionshereof, shallremainin full force and effect, to the fullest extent possible, and shall in no way be affected, impaired or invalidated thereby to the extent such are not rendered impractical to perfonn taking into consideration the purposes of this Agreement.
16 9. 9. Interpretation. This Agreement has been negotiated at arm' s length and between persons sophisticated and knowledgeable in the matters dealt with in this Agreement. In addition, each Party has been represented by experienced and knowledgeable independent legal counsel of its own choosingor hasknowingly declinedto seeksuchcounseldespitebeing encouragedand given the opportunity to do so. Each Party further acknowledges that is has not been influenced to any extent whatsoeverin executingthis Agreementby the other Parties, or by any person representing the other Parties, or both. Accordingly, any rule or law ( including Civil Code Section 1654) or legal decisionthat would require interpretationof any ambiguities in this Agreement against the Party that has drafted it is not applicable and is waived. The provisions of this Agreement shall be interpreted in a reasonable manner to affect the purpose of the Parties and this Agreement.
9. 10. Non - Waiver of Rights and Remedies. No term or provision of this Agreement shall bedeemedwaived andno breachexcused, unlesssuchwaiver or consentshall bein writing and signedby the Party claimedto havewaived or consented. Any consentby any Partyto, or waiver of, a breach by the other, whether express or implied, shall not constitute consent to, waiver of, or excuse for any other different or subsequent breach.
9. 11. Authority. The Partiesrepresentand warrant that this Agreementhasbeenduly authorizedby their respectivegoverningboards, andexecutedby aduly authorizedrepresentative thereof, and constitutesthe legally binding obligation of their respectiveParty, enforceablein accordance with its terms.
9. 12. Assignment. Except as otherwiseexpresslyprovided for herein, no Party shall assignany of its obligations or rights hereunderwithout the consentof the other Party, andany such assignment without consent shall be null and void.
9. 13. Execution in Counterparts. This Agreementmay be executedin counterparts, each of which, when the Parties have signed this Agreement, shall be deemed to be an original, and such counterparts shall constitute one and the same instrument.
SIGNATURE PAGE( S) TO FOLLOW]
17 IN WITNESS WHEREOF, the Parties to this Agreement have caused the same to be executedby eachof their duly authorized officers as follows:
Dated: November _, 2020
APPROVED AS TO FORM.
Kimberly Hall Barlow
City Attorney
Dated: lermber , 2020
J
APP OVED AS TO FORM.
C.
Aaron C. Harp
City Attorney
ATTEST:
Ml/ X
i
tall ..
City Clerk
18 CITY OF COSTA MESA
am
CITY OF NEWPORT BEACH
By: o
Will O' Neill
Mayor
IN WITNESSWHEREOF, thePartiestothisAgreementhavecausedthesameto be executedby eachof theirduly authorizedofficersasfollows:
Dated: e, 2020
PP _ OVED AS TQ
FORM.
Kimberly Hall Barlow
City Attorney
Dated: Nevenfcm _, 2020
Dea• bsr `
APPROVED AS TO FORM.
0' —
A ron C. Harp
City Attorney
ATTEST:
d4aJ-'6M'-
Teilani1. Brown
City Clerk a6WA.,
18 CITY OF COSTA MESA
CITY OF NEWPORT BEACH
By:
4Willlgeill
Mayor
EXHIBIT A.
Legal Description
Parcel4, in theCity of CostaMesa, County of Orange, Stateof California, asper mapfiled in book 34, page13of parcelmaps, in theoffice of the county recorderof saidcounty.
Excepttherefromtheminerals, oil, gas, andotherhydrocarbonsubstanceslying below the surface of said land.
APN/ Parcel ID( s): 427- 091- 12
Commonly known as 3175 Airway Ave, Costa Mesa, California Photographic depiction of the Property
K
EXHIBIT B.
Site plan and proposed scope of improvements.]
I
Total Space ( 1st floor) = 26, 710 SF
Total Building z 28, 848 SF