Susana Alcala Wood, City Attorney Jorge Oseguera, City Auditor Mindy Cuppy, City Clerk Howard Chan, City Manager John Colville, City Treasurer City Council Report
915 I Street, 1st Floor
Sacramento, CA 95814
www.cityofsacramento.org
File ID: 2021-01410 February 1, 2022 Consent Item 07
Title: Streetcar Subrecipient and Interagency Agreement Termination (S15131800)
Location: Districts 4
Recommendation: Pass a Motion authorizing the City Manager or the City Manager’s designee to terminate the Subrecipient and Interagency Agreement for Streetcar Funding between the City of Sacramento, the City of West Sacramento, Sacramento Regional Transit, and the Riverfront Joint Powers Authority.
Contact: Fedolia “Sparky” Harris, Principal Planner, (916) 808-2996, [email protected]
; David Edrosolan, City Traffic Engineer, (916) 808-5974, [email protected], Department of Public Works
Presenter: None.
Attachments:
1-Description/Analysis
2-Streetcar Termination of Subrecipient and Interagency Agreement
File ID: 2021-01410 Consent Item 07
February 1, 2022
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City of Sacramento
Description/Analysis
Issue Detail: Under a Memorandum of Understanding initiated in 2004, the Cities of Sacramento and West Sacramento agreed to jointly develop and provide funding support for a streetcar system between the two cities. Under the original plan, development of the 4.4-mile project was managed by a Joint Powers Agency (JPA) to be constructed and operated by Sacramento Regional Transit (RT). The original project managed by the JPA proved to be financially infeasible. The project has evolved to include a shorter line to be owned and operated by RT alone. Without the JPA managing the project, the subrecipient agreement to allow the JPA to access Federal Transit Authority (FTA) funding is no longer needed. RT is continuing to pursue funding and implementation of a shorter segment between the Sacramento Valley Station and Sutter Health Field in West Sacramento.
Policy Considerations: Termination of the Subrecipient and Interagency Agreement for Streetcar Funding is consistent with the Signing Authority Policy.
Economic Impacts: None.
Environmental Considerations:
California Environmental Quality Act (CEQA): The action of terminating an agreement does not have the potential to cause a significant effect on the environment and is therefore exempt under California Environmental Quality Act (CEQA) Guidelines, Section 15061(b)(3).
Sustainability: Not applicable.
Commission/Committee Action: None.
Rationale for Recommendation: The Subrecipient Agreement signed in 2017 was necessary to ensure that FTA funds received by RT for the Streetcar Project were passed through to the JPA as the party legally responsible to acquire, plan, design, finance, construct, own, operate, and maintain the project. On August 18, 2020, City Council approved a motion to dissolve the JPA and to relinquish City ownership of the Riverfront Streetcar Project to RT. Therefore, the Subrecipient Agreement no longer serves any purpose.
Financial Considerations: The Subrecipient and Interagency Agreement for Streetcar Funding did not include any additional City contributions beyond $9 million previously committed by the City Council; however, it did provide that any cost overruns beyond what was identified in the budget will need to be paid by the JPA or the two cities.
File ID: 2021-01410 Consent Item 07
February 1, 2022
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City of Sacramento
Termination of the Subrecipient and Interagency Agreement will eliminate any threat of liability for project cost overruns.
Local Business Enterprise (LBE): Not applicable.
Background: Under a Memorandum of Understanding initiated in 2004, the Cities of Sacramento and West Sacramento agreed to jointly develop and provide funding support for a streetcar system between the two cities. Under the original plan, the project was managed by a Joint Powers Agency to be constructed and operated by Sacramento Regional Transit. The project has evolved to include a shorter streetcar line to be owned and operated by RT alone.
Without the JPA or City participation in federal funding, this Subrecipient Agreement is no longer needed.
Since 2012, the project has been managed by the Sacramento Area Council of Governments (SACOG) and Sacramento Regional Transit (RT). In March 2017, the Cities of Sacramento and West Sacramento approved a Joint Exercise of Powers Agreement (JEP), City Agreement No. 2017- 0382, that created a separate legal entity, the Riverfront Joint Power Authority (JPA) to acquire, plan, design, finance, construct, own, operate, and maintain a fixed-rail streetcar system that will operate within and between Sacramento and West Sacramento.
On May 5, 2017, the President signed the omnibus spending bill for Fiscal Year (FY) 2017 that included $50 million in Small Starts Grant funding for the Downtown Riverfront Streetcar Project. Upon approval, RT would receive the $50 million as the designated recipient for Federal Transit Administration (FTA) grants in the Sacramento Metropolitan Area. On July 25, 2018, RT and the JPA entered into three agreements collectively referred to as the “Governance Documents”, to set forth the parameters for funding, design, construction and operations of the project, including the Subrecipient and Interagency Agreement for Streetcar Funding (to which the Cities are also parties)(“Subrecipient Agreement”), the Design, Procurement and Construction Agreement (“DPC Agreement”), and the Operations and Maintenance Agreement (“O&M Agreement”).
On March 20, 2019, the JPA issued a stop notice to RT consultants and staff to cease work on the project. In the intervening period, RT, the Cities, the JPA and SACOG have worked with the FTA to determine a path forward to use the appropriated federal funds, with local match, to complete a 1.1-mile portion of the project, within the available budget that would be owned, operated, and maintained by RT exclusively.
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Termination Agreement for
Subrecipient and Interagency Agreement
for Streetcar Funding
1 TERMINATION AGREEMENT FOR
SUBRECIPIENT AND INTERAGENCY AGREEMENT FOR STREETCAR FUNDING
THIS TERMINATION AGREEMENT, is made and entered into on __________________________, 2021 (“Effective Date”) , between the SACRAMENTO REGIONAL TRANSIT DISTRICT , a public corporation (herein referred to as "RT" ), the RIVERFRONT JOINT POWERS AUTHORITY , a joint power authority established by the Cities of Sacramento and West Sacramento (herein referred to as “Authority”), the CITY OF SACRAMENTO, and the CITY OF WEST SACRAMENTO, who agree as follows:
RECITALS
WHEREAS, since 2006, RT, the Cities of Sacramento and West Sacramento (“Cities”) and the Sacramento Area Council of Governments (“SACOG”), have collaboratively pursued a streetcar project that would connect the Cities across the Sacramento River (the “Project”); and
WHEREAS, in 2017, the Cities formed the Authority to conduct the Project activities on their behalf, including ownership and operation of the Project; and
WHEREAS, Congress has appropriated $50 million for the Project and the Federal Transit Administration (“FTA”) approved development and implementation of the Project, which had an estimated total Project cost in 2018 of $208 million for acquisition of streetcar vehicles and equipment and construction of Project facilities; and
WHEREAS, on July 25, 2018, RT and the Authority entered into three agreements collectively referred to as the “Governance Documents”, to s et forth the parameters for funding, design, construction and operations of the Project, including the Subrecipient and Interagency Agreement for Streetcar Funding (to which the Cities are also parties)(“Subrecipient Agreement”), the Design, Procurement an d Construction Agreement (“DPC Agreement”), and the Operations and Maintenance Agreement (“O&M Agreement”); and
WHEREAS, the Subrecipient and Interagency Agreement contemplated that RT would receive both federal and state grant funds for the Project and w ould provide those funds to the Authority as a subrecipient to own, prosecute, operate, and maintain the Project, with RT in turn invoicing the Authority as a contractor for design and construction work under the DPC Agreement;
WHEREAS, RT completed final design of the Civil, Track, Systems and Station work for the Project and, in October 2018, issued an Invitation to Bid (IFB) for Construction of Downtown/Riverfront Streetcar Civil, Track, Structures, Stations & Systems; and
WHEREAS, the bids received i n response to the IFB in January 2019 were far in excess of the amount budgeted for that portion of the Project; and
WHEREAS, RT, the Cities, the Authority and SACOG have been working with the FTA to determine a path forward to use the appropriated federal funds, with local match, to complete a 1.5-mile portion of the Project, within the available budget; and
WHEREAS, the parties have determined that RT will continue work on the revised Project, with direct local match funding from the Cities, without the involvement of the Authority and that the Project, if constructed, will be owned, operated and maintained by SacRT as the sole recipient of grant funding for the Project; and
WHEREAS, term of the Subrecipient Agreement provides that it will continue so long as there remain outstanding grant obligations; and
_____________________________
Termination Agreement for
Subrecipient and Interagency Agreement
for Streetcar Funding
2 WHEREAS, the parties desire to terminate the Subrecipient Agreement in recognition of the new structure for prosecuting the Project
NOW, THEREFORE, ASSIGNOR, ASSIGNEE, AND CITIES AGREE AS FOLLOWS:
1. EFFECTIVE DATE. This Agreement is effective on the date this Agreement is signed by all parties.
2. TERMINATION OF SUBRECIPIEN T AND INTERAGENCY AGREEMENT. Upon the Effective Date of this Agreement, the Subrecipient Agreement will be terminated and the parties will have no further obligations with respect to the Project under the Subrecipient Agreement.
3. MODIFICATION. No waiver, alteration, modification, or termination of this Agreement shall be valid unless made in writing and signed by the authorized parties hereof.
4. SEVERABILITY. If any term, covenant, or condition of this Agreement is held by a court of competent jurisdiction to be invalid, the remainder of the Agreement shall remain in effect.
5. SUCCESSORS. This Agreement is binding upon and the benefits of this Agreement inure to the successors of the parties hereto.
6. AUTHORITY. Each of the signatories to this Agreement represent that they are authorized to sign the Agreement on behalf of such party and that all approvals, resolutions and consents which must be obtained to bind such party have been obtained that no further approvals, acts or consents are required to bind such party to this Agreement.
7. AMBIGUITIES. The parties have each carefully reviewed this Agreement and have agreed to each term of this Agreement. No ambiguity is presumed to be construed against either party.
_____________________________
Termination Agreement for
Subrecipient and Interagency Agreement
for Streetcar Funding
3 IN WITNESS WHEREOF, the parties have entered into this Agreement on the day and year first hereinabove appearing.
RIVERFRONT JOINT POWERS SACRAMENTO REGIONAL
AUTHORITY TRANSIT DISTRICT
By: By:
KIRK TROST HENRY LI
Executive General Manager/CEO
Approved as to Legal Form:
By:
OLGA SANCHEZ-OCHOA
General Counsel
CITY OF SACRAMENTO CITY OF WEST SACRAMENTO
By: By:
HECTOR BARRON AARON LAUREL
Assistant City Manager City Manager
Approved as to Legal Form:
By: By:
WENDY KLOCK-JOHNSON JEFFREY MITCHELL
Assistant City Clerk City Attorney
Approved as to Legal Form:
By:
GERALD HICKS
City Attorney
I:\LG\CONTRACTS\2020 to 2024\K21Q2\ASSIGNMENT AND RELEASE AGREEMENT Streetcar Final.docx