HomeMy WebLinkAbout11 - Civic Center Project FinancingCITY OF NEWPORT BEACH
CITY COUNCIL STAFF REPORT
Agenda Item No. 11
July 27, 2010
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Administrative Services Department
Tracy McCraner, Administrative Services Director
(949) 644 -3123 or tmccraner(a)newportbeachca.gov
Dan Matusiewicz, Deputy Administrative Services Director
(949) 644 -3126 or danm(a2newportbeachca.gov
SUBJECT: PROFESSIONAL SERVICES AGREEMENTS RELATED TO THE CIVIC
CENTER PROJECT FINANCING
ISSUE:
Consider approval of an appropriation in the amount of $410,000 to provide needed
professional financial services to the City in connection with the financing of the Civic
Center project.
RECOMMENDATION:
1) Approve a budget amendment appropriating $410,000 from future bond
proceeds for initial financing costs associated with the financing of the proposed
Civic Center project.
2) Approve the attached Professional Services Agreements with:
a) Fieldman Rolapp & Associates for Financial Advisory Services;
b) Stradling Yocca Carlson & Rauth for Bond Counsel Services;
c) Hawkins Delafield & Wood LLP for Disclosure Counsel Services; and
d) William R. Hansen and Associates for Appraisal and Valuation Services
DISCUSSION:
On March 8, 2010, the Finance Committee met and determined it was time to form a
financing team to plan and prepare for the financing of the proposed Civic Center. A
typical financing team is composed of a financial advisor, bond counsel, disclosure
counsel, one or more underwriters and City staff members. Collectively, the financing
team is charged with determining the best financing structure to deliver the lowest
Professional Services Agreements Related To The Civic Center Project Financing
July 27, 2010
Page 2
overall cost of borrowing. In addition, they are responsible for the coordination and
development of all legal and financial services and documents necessary to issue
bonds.
When the Civic Center was contemplated at the 3300 Newport Boulevard location, a
financial advisor, bond counsel and underwriter were engaged to develop the plan to
finance the project. Since the project ultimately halted, the consultants were not
compensated for their efforts. Due to their widely recognized expertise in public finance
and the significant amount of time and resources invested in the previous financing plan
and documents, the Finance Committee recommended that staff continue to utilize the
services of Fieldman Rolapp & Associates as Financial Advisor, Straddling Yocca
Carlson & Rauth as Bond Counsel and Stone & Youngberg as Senior Underwriter with
additional underwriters to be selected at a later date through Requests for Proposals
(RFP). While the bond purchase agreements with underwriters will be brought to
Council at the time staff seeks the authorization to sell bonds, it is necessary to contract
for services with remaining team members at this time. Fieldman Rolapp & Associates
and Straddling Yocca Carlson and Rauth have agreed to honor their previous fee
quotes of not to exceed $70,000 as financial advisor and not to exceed $100,000 as
bond counsel, respectively.
The Finance Committee also directed staff to prepare RFPs for the disclosure counsel
and necessary appraisal services. On March 10, 2010 an RFP's to provide Disclosure
Counsel were sent to six qualified firms. Proposals were reviewed in consultation with
Fieldman Rolapp & Associates. The firm of Hawkins Delafield & Wood was selected
based on their proposed staff's combined knowledge, experience and expertise at a not
to exceed fee quote of $60,000.
Appraisal and valuation services are also necessary for this financing to minimize
capitalized interest. In order to provide sufficient collateral for the proposed borrowing,
as many as eighteen properties may be appraised to serve as interim collateral while
the Civic Center is being constructed. On June 10, 2010, RFP's were distributed to
seven qualified appraisal firms. The City received five proposals and reviewed them in
consultation with Fieldman Rolapp & Associates. The top two proposers were then
interviewed. The joint proposal submitted by independent appraisers William R. Hansen
and Gary L. Vogt were selected based on their extensive qualifications, local area
expertise and their understanding of the project needs. If it is necessary to appraise all
eighteen properties, their appraisal fees may approach $61,000.
Due to the size and complexity of the proposed bond issue it will be necessary to obtain
bond ratings from at least two of the three recognized rating agencies. It is estimated
that fees to rating agencies may approach $110,000.
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Professional Services Agreements Related To The Civic Center Project Financing
July 27, 2010
Page 3
Staff recommends that the attached budget amendment be approved in the amount of
$410,000 which will provide for the following professional services in connection with
the proposed Civic Center financing:
SERVICE
Financial Advisor
Bond Counsel
Disclosure Counsel
Appraisal Services
Rating Services
Other
TOTAL
CONSULTANT
Fieldman Rolapp & Associates
Straddling, Yocca, Carlson & Rauth
Hawkins Delafield & Wood
William Hansen & Associates
Rating Agencies To Be Determined
Misc
FEE
$ 70,000
100,000
60,000
61,000
110,000
9,000
$ 410,000
The initial cost of financing excludes underwriters' fees, trust fees, printing fees and
other filing and registration fees which will be determined at a later date.
Staff further recommends approving the attached Professional Services Agreements
with Fieldman Rolapp & Associates to act as Financial Advisor, Straddling Yocca
Carlson & Rauth to act as Bond Counsel, Hawkins Delafield & Wood to provide
Disclosure Counsel, and William R. Hansen and Associates to provide appraisal and
valuation services, in connection with the Civic Center Project Financing.
Environmental Review:
This action is not subject to the California Environmental Quality Act ( "CEQA ") pursuant
to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable
indirect physical change in the environment) and 15060(c)(3) (the activity is not a
project as defined in Section 15378) of the CEQA Guidelines, California Code of
Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical
change to the environment, directly or indirectly.
Public Notice:
This agenda item has been noticed according to the Brown Act (72 hours in advance of
the meeting at which the City Council considers the item).
Fundinq Availability:
Funding will be available subject to the sale of bonds for this project. Proposed fees to
Bond Counsel and Disclosure Counsel are solely contingent on the issuance of bonds.
However, even if bonds are not sold, as much as $40,000 may be due to the financial
advisor and fees for services rendered to the appraisal and rating agencies would
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Professional Services Agreements Related To The Civic Center Project Financing
July 27, 2010
Page 4
become due as incurred. If bonds are not sold for this project, funding for these
services would be provided by the General Fund.
Alternatives:
City Council may elect to not approve the budget amendment and /or the Professional
Services Agreements and direct staff to provide other financing team options.
Prepared by:
Dan Matusiewicz
Deputy Administrative Se Ices ' ector
Submitted by:
Tracy McC Naq er
Administrate a Services Director
Attachments:
Professional Services Agreement with Fieldman Rolapp & Associates
Professional Services Agreement with Stradling Yocca Carlson & Rauth
Professional Services Agreement with Hawkins Delafield & Wood
Professional Services Agreement with William R. Hansen
Budget Amendment No. 11 BA-001
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PROFESSIONAL SERVICES AGREEMENT WITH
FIELDMAN, ROLAPP & ASSOCIATES, INC. FOR
FINANCIAL ADVISORY SERVICES
THIS AGREEMENT is made and entered into as of this _ day of
2010, by and between the CITY OF NEWPORT BEACH, a Municipal Corporation
( "City "), and FIELDMAN, ROLAPP & ASSOCIATES, INC., A California Corporation,
whose address is: 19900 MacArthur Blvd., Suite 1100, Irvine, California, 92612
( "Consultant "), and is made with reference to the following:
RECITALS
A. City is a municipal corporation duly organized and validly existing under the laws
of the State of California with the power to carry on its business as it is now being
conducted under the statutes of the State of California and the Charter of City.
B. City is contemplating financing the construction of various public improvements
through the issuance and sale of municipal securities such as lease revenue
bonds ('Bonds "). Potential public improvements that may be financed by the
issuance of Bonds include, but are not limited to, the development and
construction of a new Civic Center, Sunset Ridge Park, Marina Park, and the
Oasis Senior Center. Bonds may also be used to refinance the outstanding
Central Library Certificates of Participation (Refunded Series 1992) (` COPs ").
Collectively, all the contemplated public improvements, Bonds and COPs
refinancing shall be referred to as the "Project'.
C. The City desires to retain the professional and technical services of the
Consultant for the purpose of providing financial advisory services as they pertain
to the financing of the Project.
D. Consultant possesses the skill, experience, ability, background, certification and
knowledge to provide the services described in this Agreement.
E. Consultant has designated Thomas M. DeMars, Robert Porr and Paul Pender as
principal consultants for purposes of the Project.
F. City has solicited and received a proposal from Consultant, has reviewed the
previous experience and evaluated the expertise of Consultant, and desires to
retain Consultant to render professional services under the terms and conditions
set forth in this Agreement.
NOW, THEREFORE, it is mutually agreed by and between the undersigned parties as
follows:
1. TERM
The term of this Agreement shall commence on the above written date, and shall
terminate upon completion of all Project work or on the 31St day of December 2012,
whichever is sooner.
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2. SERVICES TO BE PERFORMED
3.
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Consultant shall diligently perform all the services described in the Scope of
Services attached hereto as Exhibit A and incorporated herein by reference
( "Services "). The City may elect to delete certain tasks of the Scope of Services
at its sole discretion.
TIME OF PERFORMANCE
Time is of the essence in the performance of services under this Agreement and
the Services shall be performed to completion in a diligent and timely manner.
The failure by Consultant to perform the services in a diligent and timely manner
may result in termination of this Agreement by City.
COMPENSATION TO CONSULTANT
City shall pay Consultant for Services on a time and expense not -to- exceed basis
in accordance with the provisions of this Section and the Schedule of Billing
Rates attached hereto as Exhibit B and incorporated herein by reference.
Consultant's compensation for all Services performed in accordance with this
Agreement shall not exceed the amounts set forth in schedule set forth in Section
4.2. No billing rate changes shall be made during the term of this Agreement
without the prior written approval of City.
4.1 Consultant shall submit monthly invoices to City describing the Services
performed the preceding month. Consultant's bills shall include the name
of the person who performed the Services, a brief description of the
Services performed and /or the specific task in the Scope of Services to
which it relates, the date the Services were performed, the number of
hours spent on all work billed on an hourly basis, and a description of any
reimbursable expenditures. City shall pay Consultant no later than thirty
(30) days after approval of the monthly invoice by City staff.
4.2
PAR VALUE OF THE BONDS FEE SHALL NOT EXCEED
-$0- To $15,000,000 $15,000
$15,000,001 To $49,999,999 $25,000
$50,000,000 and Greater $40,000
4.3 In the event any proposed series of Bonds, are issued, Consultant shall
receive a fee upon closing of the bond issue in accordance with the
following schedule.
A. Contingent Fee Schedule
PAR VALUE OF THE BONDS FEES
-$0- To $15,000,000 $30,000
$15,000,001 To $49,999,999 $50,000
$50,000,000 and Greater $70,000
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Prior to disbursement by City, all contingent fees due to Consultant under
this Section 4.3 shall be reduced by any fees paid to the Consultant on an
hourly basis pursuant to this Section.
4.4 Expenses. Expenses will be billed separately and will cover, among
other things, travel, lodging, subsistence, overnight courier, computer, and
conference call charges. Expenses for each distinct series of bonds shall
not exceed $5,000.
4.5 Consultant shall not receive any compensation for Extra Work performed
without the prior written authorization of City. As used herein, "Extra
Work" means any work that is determined by City to be necessary for the
proper completion of the Project, but which is not included within the
Scope of Services and which the parties did not reasonably anticipate
would be necessary at the execution of this Agreement. Extra Work shall
be paid in accordance with the Schedule of Billing Rates as set forth in
Exhibit B.
5. PROJECT MANAGER
Consultant shall designate a Project Manager, who shall coordinate all phases of
the Project. This Project Manager shall be available to City at all reasonable
times during the Agreement term. Consultant has designated Thomas M.
DeMars to be its Project Manager. Consultant shall not remove or reassign the
Project Manager without the prior written consent of City. City's approval shall
not be unreasonably withheld.
Consultant, at the sole discretion of City, shall remove from the Project any of its
personnel assigned to the performance of services upon written request of City.
Consultant warrants that it will continuously furnish the necessary personnel to
complete the Project on a timely basis as contemplated by this Agreement.
6. ADMINISTRATION
This Agreement will be administered by the Administrative Services
Department. Dan Matusiewicz shall be the Project Administrator and shall have
the authority to act for City under this Agreement. The Project Administrator or
his /her authorized representative shall represent City in all matters pertaining to
the services to be rendered pursuant to this Agreement.
7. CITY'S RESPONSIBILITIES
To assist Consultant in the execution of its responsibilities under this Agreement,
City agrees to, where applicable provide access to, and upon request of
Consultant, one copy of all existing relevant information on file at City. City will
provide all such materials in a timely manner so as not to cause delays in
Consultant's work schedule.
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8. STANDARD OF CARE
8.1 All of the services shall be performed by Consultant or under Consultant's
supervision. Consultant represents that it possesses the professional and
technical personnel required to perform the services required by this
Agreement, and that it will perform all services in a manner commensurate
with community professional standards. All services shall be performed
by qualified and experienced personnel who are not employed by City, nor
have any contractual relationship with City. By delivery of completed
work, Consultant certifies that the work conforms to the requirements of
this Agreement and all applicable federal, state and local laws and the
professional standard of care.
8.2 Consultant represents and warrants to City that it has, shall obtain, and
shall keep in full force in effect during the term hereof, at its sole cost and
expense, all licenses, permits, qualifications, insurance and approvals of
whatsoever nature that is legally required of Consultant to practice its
profession. Consultant shall maintain a City of Newport Beach business
license during the term of this Agreement.
8.3 Consultant shall not be responsible for delay, nor shall Consultant be
responsible for damages or be in default or deemed to be in default by
reason of strikes, lockouts, accidents, or acts of God, or the failure of City
to furnish timely information or to approve or disapprove Consultant's work
promptly, or delay or faulty performance by City, contractors, or
governmental agencies.
9. HOLD HARMLESS
To the fullest extent permitted by law, Consultant shall indemnify, defend and
hold harmless City, its City Council, boards and commissions, officers, agents,
volunteers, and employees (collectively, the "Indemnified Parties') from and
against any and all claims (including, without limitation, claims for bodily injury,
death or damage to property), demands, obligations, damages, actions, causes
of action, suits, losses, judgments, fines, penalties, liabilities, costs and expenses
(including, without limitation, attorney's fees, disbursements and court costs) of
every kind and nature whatsoever (individually, a Claim; collectively, "Claims'),
which may arise from or in any manner relate (directly or indirectly) to any breach
of the terms and conditions of this Agreement, any work performed or services
provided under this Agreement including, without limitation, Consultant's
presence or activities conducted on the Project (including the negligent and /or
willful acts, errors and /or omissions of Consultant, its principals, officers, agents,
employees, vendors, suppliers, consultants, subcontractors, anyone employed
directly or indirectly by any of them or for whose acts they may be liable or any or
all of them).
Notwithstanding the foregoing, nothing herein shall be construed to require
Consultant to indemnify the Indemnified Parties from any Claim arising from the
sole negligence or willful misconduct of the Indemnified Parties. Nothing in this
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indemnity shall be construed as authorizing any award of attorney's fees in any
action on or to enforce the terms of this Agreement. This indemnity shall apply to
all claims and liability regardless of whether any insurance policies are
applicable. The policy limits do not act as a limitation upon the amount of
indemnification to be provided by the Consultant.
10. INDEPENDENT CONTRACTOR
It is understood that City retains Consultant on an independent contractor basis
and Consultant is not an agent or employee of City. The manner and means of
conducting the work are under the control of Consultant, except to the extent
they are limited by statute, rule or regulation and the expressed terms of this
Agreement. Nothing in this Agreement shall be deemed to constitute approval
for Consultant or any of Consultant's employees or agents, to be the agents or
employees of City. Consultant shall have the responsibility for and control over
the means of performing the work, provided that Consultant is in compliance with
the terms of this Agreement. Anything in this Agreement that may appear to give
City the right to direct Consultant as to the details of the performance or to
exercise a measure of control over Consultant shall mean only that Consultant
shall follow the desires of City with respect to the results of the services.
11. COOPERATION
Consultant agrees to work closely and cooperate fully with City's designated
Project Administrator and any other agencies that may have jurisdiction or
interest in the work to be performed. City agrees to cooperate with the
Consultant on the Project.
12. CITY POLICY
Consultant shall discuss and review all matters relating to policy and Project
direction with City's Project Administrator in advance of all critical decision points
in order to ensure the Project proceeds in a manner consistent with City goals
and policies.
13. PROGRESS
Consultant is responsible for keeping the Project Administrator and /or his /her
duly authorized designee informed on a regular basis regarding the status and
progress of the Project, activities performed and planned, and any meetings that
have been scheduled or are desired.
14. INSURANCE
Without limiting Consultant's indemnification of City, and prior to commencement
of work, Consultant shall obtain, provide and maintain at its own expense during
the term of this Agreement, a policy or policies of liability insurance of the type
and amounts described below and in a form satisfactory to City.
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A. Certificates of Insurance. Consultant shall provide certificates of
insurance with original endorsements to City as evidence of the insurance
coverage required herein. Insurance certificates must be approved by
City's Risk Manager prior to commencement of performance or issuance
of any permit. Current certification of insurance shall be kept on file with
City at all times during the term of this Agreement.
B. Signature. A person authorized by the insurer to bind coverage on its
behalf shall sign certification of all required policies.
C. Acceptable Insurers. All insurance policies shall be issued by an
insurance company currently authorized by the Insurance Commissioner
to transact business of insurance in the State of California, with an
assigned policyholders' Rating of A (or higher) and Financial Size
Category Class VII (or larger) in accordance with the latest edition of
Best's Key Rating Guide, unless otherwise approved by the City's Risk
Manager.
D. Coverage Requirements.
Workers' Compensation Coverage. Consultant shall maintain
Workers' Compensation Insurance and Employer's Liability
Insurance for his or her employees in accordance with the laws of
the State of California. In addition, Consultant shall require each
subcontractor to similarly maintain Workers' Compensation
Insurance and Employer's Liability Insurance in accordance with
the laws of the State of California for all of the subcontractor's
employees. Any notice of cancellation or non- renewal of all
Workers' Compensation policies must be received by City at least
thirty (30) calendar days (10 calendar days written notice of non-
payment of premium) prior to such change. The insurer shall agree
to waive all rights of subrogation against City, its officers, agents,
employees and volunteers for losses arising from work performed
by Consultant for City.
ii. General Liability Coverage. Consultant shall maintain commercial
general liability insurance in an amount not less than one million
dollars ($1,000,000) per occurrence for bodily injury, personal
injury, and property damage, including without limitation,
contractual liability. If commercial general liability insurance or
other form with a general aggregate limit is used, either the general
aggregate limit shall apply separately to the work to be performed
under this Agreement, or the general aggregate limit shall be at
least twice the required occurrence limit.
iii. Automobile Liability Coverage. Consultant shall maintain
automobile insurance covering bodily injury and property damage
for all activities of the Consultant arising out of or in connection with
work to be performed under this Agreement, including coverage for
any owned, hired, non -owned or rented vehicles, in an amount not
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less than one million dollars ($1,000,000) combined single limit for
each occurrence.
iv. Professional Errors and Omissions Insurance. Consultant shall
maintain professional errors and omissions insurance, which covers
the services to be performed in connection with this Agreement in
the minimum amount of two million dollars ($2,000,000).
E. Endorsements. Each general liability and automobile liability insurance
policy shall be endorsed with the following specific language:
The City, its elected or appointed officers, officials, employees,
agents and volunteers are to be covered as additional insureds with
respect to liability arising out of work performed by or on behalf of
the Consultant.
ii. This policy shall be considered primary insurance as respects to
City, its elected or appointed officers, officials, employees, agents
and volunteers as respects to all claims, losses, or liability arising
directly or indirectly from the Consultant's operations or services
provided to City. Any insurance maintained by City, including any
self- insured retention City may have, shall be considered excess
insurance only and not contributory with the insurance provided
hereunder.
iii. This insurance shall act for each insured and additional insured as
though a separate policy had been written for each, except with
respect to the limits of liability of the insuring company.
iv. The insurer waives all rights of subrogation against City, its elected
or appointed officers, officials, employees, agents and volunteers.
V. Any failure to comply with reporting provisions of the policies shall
not affect coverage provided to City, its elected or appointed
officers, officials, employees, agents or volunteers.
vi. The insurance provided by this policy shall not be suspended,
voided, canceled, or reduced in coverage or in limits, by either party
except after thirty (30) calendar days (10 calendar days written
notice of non - payment of premium) written notice has been
received by City.
F. Timely Notice of Claims. Consultant shall give City prompt and timely
notice of claim made or suit instituted arising out of or resulting from
Consultant's performance under this Agreement.
G. Additional Insurance. Consultant shall also procure and maintain, at its
own cost and expense, any additional kinds of insurance, which in its own
judgment may be necessary for its proper protection and prosecution of
the work.
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15. PROHIBITION AGAINST ASSIGNMENTS AND TRANSFERS
Except as specifically authorized under this Agreement, the services to be
provided under this Agreement shall not be assigned, transferred contracted or
subcontracted out without the prior written approval of City. Any of the following
shall be construed as an assignment: The sale, assignment, transfer or other
disposition of any of the issued and outstanding capital stock of Consultant, or of
the interest of any general partner or joint venturer or syndicate member or
cotenant if Consultant is a partnership or joint-venture or syndicate or cotenancy,
which shall result in changing the control of Consultant. Control means fifty
percent (50 %) or more of the voting power, or twenty -five percent (25 %) or more
of the assets of the corporation, partnership orjoint- venture.
16. SUBCONTRACTING
The parties recognize that a substantial inducement to City for entering into this
Agreement is the professional reputation, experience and competence of
Consultant. Assignments of any or all rights, duties or obligations of the
Consultant under this Agreement will be permitted only with the express written
consent of City. Consultant shall not subcontract any portion of the work to be
performed under this Agreement without the prior written authorization of City.
17. OWNERSHIP OF DOCUMENTS
Each and every report, draft, document and other writing produced (hereinafter
"Documents "), prepared or caused to be prepared by Consultant, its officers,
employees, agents and subcontractors, in the course of implementing this
Agreement, shall become the exclusive property of City, and City shall have the
sole right to use such materials in its discretion without further compensation to
Consultant or any other party. Consultant shall, at Consultant's expense, provide
such Documents to City upon prior written request.
Documents prepared by Consultant pursuant to this Agreement are not intended
or represented to be suitable for reuse by City or others on any other project.
Any use of completed Documents for other projects and any use of incomplete
Documents without specific written authorization from Consultant will be at City's
sole risk and without liability to Consultant. Further, any and all liability arising
out of changes made to Consultant's deliverables under this Agreement by City
or persons other than Consultant is waived against Consultant and City assumes
full responsibility for such changes unless City has given Consultant prior notice
and has received from Consultant written consent for such changes.
18. CONFIDENTIALITY
All Documents, including drafts, notes and communications that result from the
services in this Agreement, shall be kept confidential unless City authorizes in
writing the release of information.
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22.
RECORDS
Consultant shall keep records and invoices in connection with the work to be
performed under this Agreement. Consultant shall maintain complete and
accurate records with respect to the costs incurred under this Agreement and
any services, expenditures and disbursements charged to City, for a minimum
period of three (3) years, or for any longer period required by law, from the date
of final payment to Consultant under this Agreement. All such records and
invoices shall be clearly identifiable. Consultant shall allow a representative of
City to examine, audit and make transcripts or copies of such records and
invoices during regular business hours. Consultant shall allow inspection of all
work, data, Documents, proceedings and activities related to the Agreement for a
period of three (3) years from the date of final payment to Consultant under this
Agreement.
WITHHOLDINGS
City may withhold payment to Consultant of any disputed sums until satisfaction
of the dispute with respect to such payment. Such withholding shall not be
deemed to constitute a failure to pay according to the terms of this Agreement.
Consultant shall not discontinue work as a result of such withholding. Consultant
shall have an immediate right to appeal to the City Manager or his /her designee
with respect to such disputed sums. Consultant shall be entitled to receive
interest on any withheld sums at the rate of return that City earned on its
investments during the time period, from the date of withholding of any amounts
found to have been improperly withheld.
ERRORS AND OMISSIONS
In the event of errors or omissions that are due. to the negligence or professional
inexperience of Consultant which result in expense to City greater than what
would have resulted if there were not errors or omissions in the work
accomplished by Consultant, the additional expense shall be borne by
Consultant. Nothing in this paragraph is intended to limit City's rights under the
law or any other sections of this Agreement.
CITY'S RIGHT TO EMPLOY OTHER CONSULTANTS
City reserves the right to employ other Consultants in connection with the
Project.
23. CONFLICTS OF INTEREST
The Consultant or its employees may be subject to the provisions of the
California Political Reform Act of 1974 (the "Act "), which (1) requires such
persons to disclose any financial interest that may foreseeably be materially
affected by the work performed under this Agreement, and (2) prohibits such
persons from making, or participating in making, decisions that will foreseeably
financially affect such interest.
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If subject to the Act, Consultant shall conform to all requirements of the Act.
Failure to do so constitutes a material breach and is grounds for immediate
termination of this Agreement by City. Consultant shall indemnify and hold
harmless City for any and all claims for damages resulting from Consultant's
violation of this Section.
24. NOTICES
All notices, demands, requests or approvals to be given under the terms of this
Agreement shall be given in writing, and conclusively shall be deemed served
when delivered personally, or on the third business day after the deposit thereof
in the United States mail, postage prepaid, first -class mail, addressed as
hereinafter provided. All notices, demands, requests or approvals from
Consultant to City shall be addressed to City at:
Attn: Dan Matusiewicz
Administrative Services Department
City of Newport Beach
3300 Newport Boulevard
Newport Beach, CA 92663
Phone: 949 - 644 -3126
Fax: 949 - 644 -3339
All notices, demands, requests or approvals from CITY to Consultant shall be
addressed to Consultant at:
Attn: Thomas M. DeMars
FIELDMAN, ROLAPP & ASSOCIATES, INC.
19900 MacArthur Blvd., Suite 1100
Irvine, CA, 92612
Phone: 949 - 725 -4000
Fax: 949 - 725 -4100
25. TERMINATION
In the event that either party fails or refuses to perform any of the provisions of
this Agreement at the time and in the manner required, that party shall be
deemed in default in the performance of this Agreement. If such default is not
cured within a period of two (2) calendar days, or if more than two (2) calendar
days are reasonably required to cure the default and the defaulting party fails to
give adequate assurance of due performance within two (2) calendar days after
receipt of written notice of default, specifying the nature of such default and the
steps necessary to cure such default, and thereafter diligently take steps to cure
the default, the non- defaulting party may terminate the Agreement forthwith by
giving to the defaulting party written notice thereof.
Notwithstanding the above provisions, City shall have the right, at its sole
discretion and without cause, of terminating this Agreement at any time by giving
seven (7) calendar days prior written notice to Consultant. In the event of
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termination under this Section, City shall pay Consultant for services satisfactorily
performed and costs incurred up to the effective date of termination for which
Consultant has not been previously paid. On the effective date of termination,
Consultant shall deliver to City all reports, Documents and other information
developed or accumulated in the performance of this Agreement, whether in draft
or final form.
26. COMPLIANCE WITH ALL LAWS
Consultant shall at its own cost and expense comply with all statutes,
ordinances, regulations and requirements of all governmental entities, including
federal, state, county or municipal, whether now in force or hereinafter enacted.
In addition, all work prepared by Consultant shall conform to applicable City,
county, state and federal laws, rules, regulations and permit requirements and be
subject to approval of the Project Administrator and City.
27. WAIVER
A waiver by either party of any breach, of any term, covenant or condition
contained herein shall not be deemed to be a waiver of any subsequent breach
of the same or any other term, covenant or condition contained herein, whether
of the same or a different character.
28. INTEGRATED CONTRACT
This Agreement represents the full and complete understanding of every kind or
nature whatsoever between the parties hereto, and all preliminary negotiations
and agreements of whatsoever kind or nature are merged herein. No verbal
agreement or implied covenant shall be held to vary the provisions herein.
29. CONFLICTS OR INCONSISTENCIES
In the event there are any conflicts or inconsistencies between this Agreement
and the Scope of Services or any other attachments attached hereto, the terms
of this Agreement shall govern.
30. INTERPRETATION
The terms of this Agreement shall be construed in accordance with the meaning
of the language used and shall not be construed for or against either party by
reason of the authorship of the Agreement or any other rule of construction which
might otherwise apply.
31. AMENDMENTS
This Agreement may be modified or amended only by a written document
executed by both Consultant and City and approved as to form by the City
Attorney.
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9309AVI :1 - 111111wil
If any term or portion of this Agreement is held to be invalid, illegal, or otherwise
unenforceable by a court of competent jurisdiction, the remaining provisions of
this Agreement shall continue in full force and effect.
33. CONTROLLING LAW AND VENUE
The laws of the State of California shall govern this Agreement and all matters
relating to it and any action brought relating to this Agreement shall be
adjudicated in a court of competent jurisdiction in the County of Orange.
34. EQUAL OPPORTUNITY EMPLOYMENT
Consultant represents that it is an equal opportunity employer and it shall not
discriminate against any subcontractor, employee or applicant for employment
because of race, religion, color, national origin, handicap, ancestry, sex or age.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed on
the day and year first written above.
APPROVED AS TO FORM: CITY OF NEWPORT BEACH,
n� A Municipal Corporation
By: By:
onie'Mulvihill, Keith D. Curry, Mayor
Assistant City Attorney City of Newport Beach
City of Newport Beach
ATTEST:
Leilani Brown, City Clerk
City of Newport Beach
CONSULTANT:
(Corporate Officer)
Print N
By:
(Financial Officer)
Title:
Print Name:
Attachments: Exhibit A — Scope of Services
Exhibit B — Billing Rates
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EXHIBIT A
SCOPE OF SERVICES
A. General Services.
The Consultant shall perform all the duties and services specifically set forth herein and
shall provide such other services as City and Consultant mutually deem necessary or
advisable, or are reasonable and necessary to accomplish the intent of this Agreement
in a manner consistent with the standards and practice of professional financial advisors
prevailing at the time such services are rendered to the City.
The City may, with the concurrence of Consultant, expand this Agreement to include
any additional services not specifically identified within the terms of this Agreement.
Any additional services may be described in an addendum to this Exhibit A and are
subject to fees described in Exhibit B to this Agreement.
B. Debt Issuance Services.
The Consultant shall assume primary responsibility for assisting the City in coordinating
the planning and execution of each debt issue relating to the Project. Insofar as the
Consultant is providing Services which are rendered only to the City, the overall
coordination of the financing shall be such as to minimize the costs of the transaction
coincident with maximizing the City's financing flexibility and capital market access. The
Consultant's proposed debt issuance Services may include, but shall not be limited to,
the following:
• Establish the Financing Objectives;
• Develop the Financing Schedule;
• Monitor the Transaction Process;
• Review the Official Statement, both preliminary and final;
• Procure and Coordinate Additional Service Providers;
Provide Financial Advice to the City Relating to Financing
Documents;
• Compute Sizing and Design Structure of the Debt Issue;
• Plan and Schedule Rating Agency Presentation and Investor
Briefings;
• Conduct Credit Enhancement Procurement and Evaluation;
• Conduct Market Analysis and Evaluate Timing of Market Entry;
• Recommend Award of Debt Issuance;
• Provide Pre - Closing and Closing Assistance;
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Specifically, Consultant will:
1. Establish the Financing Objectives.
At the onset of the financing transaction process for the Project, the
Consultant shall review the City's financing needs and in conjunction with the
City's management, outline the objectives of the financing transaction to be
undertaken and its proposed form.
Unless previously determined, Consultant shall recommend the method of
sale of debt and outline the steps required to achieve efficient market access.
2. Develop the Financing Timetable.
The Consultant shall take the lead role in preparing a schedule and detailed
description of the interconnected responsibilities of each team member and
update this schedule, with refinements, as necessary, as the work
progresses.
3. Monitor the Transaction Process.
The Consultant shall have primary responsibility for the successful
implementation of the financing strategy and timetable that is adopted for
each debt issue relating to the Project. The Consultant shall coordinate (and
assist, where appropriate) the review of the legal and disclosure documents
and shall monitor the progress of all activities leading to the sale of debt. The
Consultant shall prepare the timetables and work schedules necessary to
achieve this end in a timely, efficient and cost - effective manner and will
coordinate and monitor the activities of all parties engaged in the financing
transaction.
4. Review the Preliminary and Final Official Statement
a. Generally, SEC, MSRB, and GFOA guidelines encourage full
disclosure so that potential investors have sufficient data to analyze
each proposed financing. When reviewing the Preliminary Official
Statement, the Consultant shall review the following:
• Security for the Financing;
• Restrictions on Additional Financings;
• Purpose and Funds for which the Financing is Being Issued;
• Revenue Sources: Historic, Current and Projected;
• Outstanding Financings;
• Planned Future Financings;
• Labor Relations and Retirement Systems;
• Economic Base;
• Annual Financial Statements;
• Legal Opinions Regarding Tax Exemption;
• Such Other Matters as the Context May Require.
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5. Procure and Coordinate Additional Service Providers.
Should the City desire, the Consultant may act as City's representative in
procuring the services of financial printers for the official statement and related
documents, and for the printing of any securities. In addition, the Consultant may
act as the City's representative in procuring the services of trustees, paying
agents, fiscal agents, feasibility consultants, or other professionals, if the City
directs.
6. Provide Financial Advice to the City Relatina to Financina Documents.
Simultaneous with assisting in the preparation of official statements for each debt
issue relating to the Project, the Consultant shall assist the managing
underwriters, bond counsel and /or other legal advisors in the drafting of the
respective financing resolutions, notices and other legal documents. In this
regard, the Consultant shall monitor document preparation for a consistent and
accurate presentation of the recommended business terms and financing
structure of each debt issue relating to the Project, it being specifically
understood however that the Consultant's services shall in no manner be
construed as the Consultant engaging in the practice of law.
7. Compute Sizing and Design Structure of Debt Issue.
The Consultant shall work with the City's staff to design a financing structure for
each debt issue relating to the Project that is consistent with the City's objectives,
that coordinates each transaction with outstanding issues and that reflects
current conditions in the capital markets.
8. Plan and Schedule Rating Agency Presentation and Investor Briefings.
The Consultant shall develop a plan for presenting the financing program to the
rating agencies and, if deemed appropriate, the investor community. The
Consultant shall work with other financing team members to schedule rating
agency visits, if appropriate; to assure the appropriate and most knowledgeable
rating agency personnel are available for the presentation and will develop
presentation materials and assist the City officials in preparing for the
presentations.
9. Conduct Credit Enhancement Evaluation and Procurement.
Upon the City's direction, the Consultant will initiate discussions with bond
insurers, letter of credit providers and vendors of other forms of credit
enhancements to determine the availability of and cost benefit of securing
financing credit support.
10. Conduct Market Analysis and Evaluate Timing of Market Entry.
The Consultant shall provide regular summaries of current municipal market
conditions, trends in the market and how these may favorably or unfavorably
affect the City's proposed financing.
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Negotiated Sales.
In the case of a negotiated sale of debt, the Consultant shall perform a
thorough evaluation of market conditions preceding the negotiation of the
terms of the sale of debt and will assist the City with the negotiation of final
issue structure, interest rates, interest cost, reoffering terms and gross
underwriting spread and provide a recommendation on acceptance or
rejection of the offer to purchase the debt. This assistance and evaluation
will focus on the following areas as determinants of interest cost:
• Size of financing
• Sources and uses of funds
• Terms and maturities of the debt issue
• Review of the rating in pricing of the debt issue
• Investment of debt issue proceeds
• Distribution mix among institutional and retail purchasers
• Interest rate, reoffering terms and underwriting discount with
comparable issues
• Redemption provisions
11. Recommend Award of Debt Issuance.
Based upon activities outlined in Task 10 above, the Consultant will make a
recommendation to accept or reject offers to purchase the debt issue. If the
City elects to award the debt issue, the Consultant will instruct all parties and
help facilitate the actions required to formally consummate the award.
12. Provide Pre - Closina and Closing Activities.
The Consultant shall assist in arranging for the closing of each financing. The
Consultant shall assist counsel in assuming responsibility for such
arrangements as they are required, including arranging for or monitoring the
progress of bond printing, qualification of issues for book -entry status, signing
and final delivery of the securities and settlement of the costs of issuance.
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EXHIBIT B
SCHEDULE OF HOURLY BILLING RATES
Personnel
Hourly Rate
Executive Officer ..................... ........................$300.00
Principal .................. ...............................
$290.00
Senior Vice Presidents ............ ........................$275.00
Vice Presidents ....................... ........................$225.00
Assistant Vice Presidents ........ ........................$195.00
Senior Associate .............. ...............................
$150.00
Associates ........................ ...............................
$125.00
Analyst...... ............................... .........................
$85.00
Administrative Assistants ... ...............................
$65.00
Clerical ( Other) ......................... .........................$35.00
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PROFESSIONAL SERVICES AGREEMENT WITH
STRADLING YOCCA CARLSON & RAUTH FOR
BOND COUNSEL SERVICES
THIS AGREEMENT is made and entered into as of this day of
, 2010 ( "Effective Date "), by and between the CITY OF NEWPORT
BEACH, a Municipal Corporation ( "City "), STRADLING YOCCA CARLSON & RAUTH,
A California Professional Corporation, whose address is: 660 Newport Center Dr., Suite
1600, Newport Beach California, 92660 -6422 ( "Consultant'), and is made with
reference to the following:
RECITALS
A. City is a municipal corporation duly organized and validly existing under
the laws of the State of California with the power to carry on its business as it is now
being conducted under the statutes of the State of California and the Charter of City.
B. City is contemplating financing the construction of various public
improvements through the issuance and sale of municipal securities such as lease
revenue bonds ( "Bonds'). Potential public improvements that may be financed by the
issuance of Bonds include, but are not limited to, the development and construction of a
new Civic Center, Sunset Ridge Park, Marina Park, and the Oasis Senior Center,
Bonds may also be used to refinance the outstanding Central Library Certificates of
Participation (Refunded Series 1992) ( "COPs "). Collectively, all the contemplated public
improvements, Bonds and COPs refinancing shall be referred to as the "Project'.
C. City desires to engage Consultant to act as Bond Counsel in connection
with the proposed Project.
D. Consultant possesses the skill, experience, ability, background,
certification and knowledge to provide the services described in this Agreement.
E. The principal attorney with the Consultant for purposes of the Project shall
be David R. McEwen.
F. City has solicited and received a proposal from Consultant, has reviewed
the previous experience and evaluated the expertise of Consultant, and desires to retain
Consultant to render professional services under the terms and conditions set forth in
this Agreement.
NOW, THEREFORE, it is mutually agreed by and between the undersigned
parties as follows:
1. TERM
The term of this Agreement shall commence on the Effective Date, and shall
terminate upon either the issuance of the Bonds and completion of all Project work or
on 31St day of March 2011, whichever is sooner.
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2. SERVICES TO BE PERFORMED; EXCLUDED SERVICES
Consultant shall diligently perform all the services described under the heading
"Services Included" in the Scope of Services attached hereto as Exhibit A and
incorporated herein by reference. The City may elect to delete certain tasks of the
Scope of Services at its sole discretion. Consultant shall not be responsible for the
services described under the heading "Services Excluded" in Exhibit A.
3. TIME OF PERFORMANCE
Time is of the essence in the performance of services under this Agreement and
the services shall be performed to completion in a diligent and timely manner. The
failure by Consultant to perform the services in a diligent and timely manner may result
in termination of this Agreement by City.
4. COMPENSATION TO CONSULTANT
Consultant's compensation for all work performed in accordance with this
Agreement, contingent upon issuance of the Bonds, shall be the total sum of One
Hundred Thousand Dollars and no /100 ($100,000.00). The total sum shall not be
exceeded without prior written authorization from City. In the event that no Bonds are
sold, Consultant shall only be entitled to be reimbursed for reimbursable items set forth
herein and shall not be entitled to any fees or other compensation under this
Agreement.
4.1 City shall reimburse Consultant for those costs or expenses specifically
approved in this Agreement, or specifically approved in writing in advance by City.
Unless otherwise approved, such costs shall be limited and include nothing more than
the following costs incurred by Consultant:
A. Document reproduction charges, overnight delivery and messenger
charges, telecommunication charges, printing costs, filing fees, and long distance
telephone calls.
B. Actual costs and /or other costs and /or payments specifically
authorized in advance in writing by City and incurred by Consultant in the performance
of this Agreement.
4.2 Consultant shall not receive any compensation for Extra Work performed
without the prior written authorization of City. As used herein, "Extra Work" means any
work that is determined by City to be necessary for the proper completion of the Project,
but which is not included within the Scope of Services and which the parties did not
reasonably anticipate would be necessary at the execution of this Agreement. Extra
Work shall be paid at the customary hourly rate of the attorney performing such
services, which rate in no event will exceed $325.00 per hour.
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5. PROJECT MANAGER
Consultant shall designate a Project Manager, who shall coordinate all phases of
the Project. This Project Manager shall be available to City at all reasonable times
during the Agreement term. Consultant has designated David R. McEwen to be its
Project Manager. Consultant shall not remove or reassign the Project Manager without
the prior written consent of City. City's approval shall not be unreasonably withheld.
Consultant, at the sole discretion of City, shall remove from the Project any of its
personnel assigned to the performance of services upon written request of City.
Consultant warrants that it will continuously furnish the necessary personnel to
complete the Project on a timely basis as contemplated by this Agreement.
6. ADMINISTRATION
This Agreement will be administered by the Administrative Services
Department. Dan Matusiewicz shall be the Project Administrator and shall have the
authority to act for City under this Agreement. The Project Administrator or his
authorized representative shall represent City in all matters pertaining to the services to
be rendered pursuant to this Agreement.
7. CITY'S RESPONSIBILITIES
To assist Consultant in the execution of its responsibilities under this Agreement,
City agrees to, where applicable, provide access to, and upon request of Consultant,
one copy of all existing relevant information on file at City. City will provide all such
materials in a timely manner so as not to cause delays in Consultant's work schedule.
8. STANDARD OF CARE
8.1 All of the services shall be performed by Consultant or under Consultant's
supervision. Consultant represents that it possesses the professional and technical
personnel required to perform the services required by this Agreement, and that it will
perform all services in a manner commensurate with community professional standards.
All services shall be performed by qualified and experienced personnel who are not
employed by City, nor have any contractual relationship with City. By delivery of
completed work, Consultant certifies that the work conforms to the requirements of this
Agreement and all applicable federal, state and local laws and the professional standard
of care.
8.2 Consultant represents and warrants to City that it has, shall obtain, and
shall keep in full force in effect during the term hereof, at its sole cost and expense, all
licenses, permits, qualifications, insurance and approvals of whatsoever nature that is
legally required of Consultant to practice its profession. Consultant shall maintain a City
of Newport Beach business license during the term of this Agreement.
8.3 Consultant shall not be responsible for delay, nor shall Consultant be
responsible for damages or be in default or deemed to be in default by reason of strikes,
lockouts, accidents, or acts of God, or the failure of City to furnish timely information or
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to approve or disapprove Consultant's work promptly, or delay or faulty performance by
City, contractors, or governmental agencies.
9. HOLD HARMLESS
To the fullest extent permitted by law, Consultant shall defend City, its City
Council, boards and commissions, officers, agents, volunteers, and employees
(collectively, the "Indemnified Parties ") against any and all claims (including, without
limitation, claims for bodily injury, death or damage to property), investigations,
challenges, demands, obligations, damages, actions, causes of action, suits, losses,
judgments, fines, penalties, liabilities, costs and expenses (including, without limitation,
attorney's fees, disbursements and court costs) of every kind and nature whatsoever
(individually, a Claim; collectively, "Claims "), which may arise from or in any manner
relate (directly or indirectly) to any breach of the terms and conditions of this
Agreement, any Work performed or Services provided under this Agreement including,
without limitation, defects in workmanship or materials or Consultant's presence or
activities conducted on the Project (including the negligent and /or willful acts, errors
and/or omissions of Consultant, its principals, officers, agents, employees, vendors,
suppliers, subconsultants, subcontractors, anyone employed directly or indirectly by any
of them or for whose acts they may be liable or any or all of them).
To the fullest extent permitted by law, Consultant shall indemnify and hold
harmless City, its City Council, boards and commissions, officers, agents, volunteers,
and employees (collectively, the "Indemnified Parties ") from and against any and all
claims (including, without limitation, claims for bodily injury, death or damage to
property), demands, obligations, damages, actions, causes of action, suits, losses,
judgments, fines, penalties, liabilities, costs and expenses (including, without limitation,
attorney's fees, disbursements and court costs) of every kind and nature whatsoever
(individually, a Claim; collectively, "Claims "), which is proximately caused by any breach
of the terms and conditions of this Agreement and any Work performed or Services
provided under this Agreement (including the negligent and /or willful acts, errors and /or
omissions of Consultant, its principals, officers, agents, employees, anyone employed
directly or indirectly by any of them or for whose acts they may be liable or any or all of
them).
Notwithstanding the foregoing, nothing herein shall be construed to require
Consultant to indemnify the Indemnified Parties from any Claim arising from the sole
negligence or willful misconduct of the Indemnified Parties. Nothing in this indemnity
shall be construed as authorizing any award of attorney's fees in any action on or to
enforce the terms of this Agreement. This indemnity shall apply to all claims and liability
regardless of whether any insurance policies are applicable. The policy limits do not act
as a limitation upon the amount of indemnification to be provided by the Consultant.
10. INDEPENDENT CONTRACTOR
It is understood that City retains Consultant on an independent contractor basis
and Consultant is not an agent or employee of City. The manner and means of
conducting the work are under the control of Consultant, except to the extent they are
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limited by statute, rule or regulation and the expressed terms of this Agreement.
Nothing in this Agreement shall be deemed to constitute approval for Consultant or any
of Consultant's employees or agents, to be the agents or employees of City. Consultant
shall have the responsibility for and control over the means of performing the work,
provided that Consultant is in compliance with the terms of this Agreement. Anything in
this Agreement that may appear to give City the right to direct Consultant as to the
details of the performance or to exercise a measure of control over Consultant shall
mean only that Consultant shall follow the desires of City with respect to the results of
the services.
11. COOPERATION
Consultant agrees to work closely and cooperate fully with City's designated
Project Administrator and any other agencies that may have jurisdiction or interest in the
work to be performed. City agrees to cooperate with the Consultant on the Project.
12. CITY POLICY
Consultant shall discuss and review all matters relating to policy and Project
direction with City's Project Administrator in advance of all critical decision points in
order to ensure the Project proceeds in a manner consistent with City goals and
policies.
13. PROGRESS
Consultant is responsible for keeping the Project Administrator and /or his duly
authorized designee informed on a regular basis regarding the status and progress of
the Project, activities performed and planned, and any meetings that have been
scheduled or are desired.
14. INSURANCE
Without limiting Consultant's indemnification of City, and prior to commencement
of work, Consultant shall obtain, provide and maintain at its own expense during the
term of this Agreement, policies of insurance of the type and amounts described below
and in a form satisfactory to City.
A. Proof of Insurance. Consultant shall provide certificates of insurance to
City as evidence of the insurance coverage required herein, along with a
waiver of subrogation endorsement for workers' compensation. Insurance
certificates and endorsement must be approved by City's Risk Manager
prior to commencement of performance. Current certification of insurance
shall be kept on file with City at all times during the term of this contract.
City reserves the right to require complete, certified copies of all required
insurance policies, at any time.
Consultant shall procure and maintain for the duration of the contract
insurance against claims for injuries to persons or damages to property,
which may arise from or in connection with the performance of the Work
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hereunder by Consultant, his agents, representatives, employees or
subconsultants. The cost of such insurance shall be included in
Consultant's bid.
B. Acceptable Insurers. All insurance policies shall be issued by an
insurance company currently authorized by the Insurance Commissioner
to transact business of insurance in the State of California, with an
assigned policyholders' Rating of A- (or higher) and Financial Size
Category Class VII (or larger) in accordance with the latest edition of
Best's Key Rating Guide, unless otherwise approved by the City's Risk
Manager.
C. Coverage Requirements.
Workers' Compensation Coverage. Consultant shall maintain
Workers' Compensation Insurance (Statutory Limits) and
Employer's Liability Insurance (with limits of at least one million
dollars ($1,000,000)) for Consultant's employees in accordance
with the laws of the State of California, Section 3700 of the Labor
Code In addition, Consultant shall require each subconsultant to
similarly maintain Workers' Compensation Insurance and
Employer's Liability Insurance in accordance with the laws of the
State of California, Section 3700 for all of the subconsultant's
employees.
Any notice of cancellation or non - renewal of all Workers'
Compensation policies must be received by City at least thirty (30)
calendar days (ten (10) calendar days written notice of non-
payment of premium) prior to such change.
Consultant shall submit to City, along with the certificate of
insurance, a Waiver of Subrogation endorsement in favor of City, its
officers, agents, employees and volunteers.
ii. General Liability Coverage. Consultant shall maintain commercial
general liability insurance in an amount not less than one million
dollars ($1,000,000) per occurrence for bodily injury, personal
injury, and property damage, including without limitation, blanket
contractual liability.
iii. Automobile Liability Coverage. Consultant shall maintain
automobile insurance covering bodily injury and property damage
for all activities of the Consultant arising out of or in connection with
Work to be performed under this Agreement, including coverage for
any owned, hired, non -owned or rented vehicles, in an amount not
less than one million dollars ($1,000,000) combined single limit for
each accident.
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iv. Professional Liability (Errors & Omissions) Coverage. Consultant
shall maintain professional liability insurance that covers the
Services to be performed in connection with this Agreement, in the
minimum amount of five million dollars ($5,000,000) limit per claim
and in the aggregate.
D. Other Insurance Provisions or Requirements.
The policies are to contain, or be endorsed to contain, the following provisions:
L Waiver of Subrogation. All insurance coverage maintained or
procured pursuant to this agreement shall be endorsed to waive
subrogation against City, its elected or appointed officers, agents,
officials, employees and volunteers or shall specifically allow
Consultant or others providing insurance evidence in compliance
with these requirements to waive their right of recovery prior to a
loss. Consultant hereby waives its own right of recovery against
City, and shall require similar written express waivers and
insurance clauses from each of its subconsultants.
ii. Enforcement of Contract Provisions. Consultant acknowledges and
agrees that any actual or alleged failure on the part of the City to
inform Consultant of non - compliance with any requirement imposes
no additional obligations on the City nor does it waive any rights
hereunder.
iii. Requirements not Limiting. Requirements of specific coverage
features or limits contained in this Section are not intended as a
limitation on coverage, limits or other requirements, or a waiver of
any coverage normally provided by any insurance. Specific
reference to a given coverage feature is for purposes of clarification
only as it pertains to a given issue and is not intended by any party
or insured to be all inclusive, or to the exclusion of other coverage,
or a waiver of any type.
iv. Notice of Cancellation. Consultant agrees to oblige its insurance
agent or broker and insurers to provide to City with thirty (30) days
notice of cancellation (except for nonpayment for which ten (10)
days notice is required) or nonrenewal of coverage for each
required coverage.
E. Timely Notice of Claims. Consultant shall give City prompt and timely
notice of claims made or suits instituted that arise out of or result from
Consultant's performance under this Agreement.
F. Additional Insurance. Consultant shall also procure and maintain, at its
own cost and expense, any additional kinds of insurance, which in its own
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judgment may be necessary for its proper protection and prosecution of
the Work.
15. PROHIBITION AGAINST ASSIGNMENTS AND TRANSFERS
Except as specifically authorized under this Agreement, the services to be
provided under this Agreement shall not be assigned, transferred contracted or
subcontracted out without the prior written approval of City. Any of the following shall
be construed as an assignment: The sale, assignment, transfer or other disposition of
any of the issued and outstanding capital stock of Consultant, or of the interest of any
general partner or joint venturer or syndicate member or cotenant if Consultant is a
partnership or joint- venture or syndicate or cotenancy, which shall result in changing the
control of Consultant. Control means fifty percent (50 %) or more of the voting power, or
twenty -five percent (25 %) or more of the assets of the corporation, partnership or joint -
venture.
16. SUBCONTRACTING
The parties recognize that a substantial inducement to City for entering into this
Agreement is the professional reputation, experience and competence of Consultant.
Assignments of any or all rights, duties or obligations of the Consultant under this
Agreement will be permitted only with the express written consent of City. Consultant
shall not subcontract any portion of the work to be performed under this Agreement
without the prior written authorization of City.
17. OWNERSHIP OF DOCUMENTS
Each and every report, draft, document and other writing produced (hereinafter
"Documents "), prepared or caused to be prepared by Consultant, its officers,
employees, agents and subcontractors, in the course of implementing this Agreement,
shall become the exclusive property of City, and City shall have the sole right to use
such materials in its discretion without further compensation to Consultant or any other
party. Consultant shall, at Consultant's expense, provide such Documents to City upon
prior written request.
Documents prepared by Consultant pursuant to this Agreement are not intended
or represented to be suitable for reuse by City or others on any other project. Any use
of completed Documents for other projects and any use of incomplete Documents
without specific written authorization from Consultant will be at City's sole risk and
without liability to Consultant. Further, any and all liability arising out of changes made
to Consultant's deliverables under this Agreement by City or persons other than
Consultant is waived against Consultant and City assumes full responsibility for such
changes unless City has given Consultant prior notice and has received from
Consultant written consent for such changes.
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18. CONFIDENTIALITY
All Documents, including drafts, notes and communications that result from the
services in this Agreement, shall be kept confidential unless City authorizes in writing
the release of information.
19. RECORDS
Consultant shall keep records and invoices in connection with the work to be
performed under this Agreement. Consultant shall maintain complete and accurate
records with respect to the costs incurred under this Agreement and any services,
expenditures and disbursements charged to City, for a minimum period of three (3)
years, or for any longer period required by law, from the date of final payment to
Consultant under this Agreement. All such records and invoices shall be clearly
identifiable. Consultant shall allow a representative of City to examine, audit and make
transcripts or copies of such records and invoices during regular business hours.
Consultant shall allow inspection of all work, data, Documents, proceedings and
activities related to the Agreement for a period of three (3) years from the date of final
payment to Consultant under this Agreement.
20. WITHHOLDINGS
City may withhold payment to Consultant of any disputed sums until satisfaction
of the dispute with respect to such payment. Such withholding shall not be deemed to
constitute a failure to pay according to the terms of this Agreement. Consultant shall
not discontinue work as a result of such withholding. Consultant shall have an
immediate right to appeal to the City Manager or his /her designee with respect to such
disputed sums. Consultant shall be entitled to receive interest on any withheld sums at
the rate of return that City earned on its investments during the time period, from the
date of withholding of any amounts found to have been improperly withheld.
21. ERRORS AND OMISSIONS
In the event of errors or omissions that are due to the negligence or professional
inexperience of Consultant which result in expense to City greater than what would
have resulted if there were not errors or omissions in the work accomplished by
Consultant, the additional expense shall be borne by Consultant. Nothing in this
paragraph is intended to limit City's rights under the law or any other sections of this
Agreement.
22. CITY'S RIGHT TO EMPLOY OTHER CONSULTANTS
City reserves the right to employ other Consultants in connection with the
Project.
23. CONFLICTS OF INTEREST
The Consultant or its employees may be subject to the provisions of the
California Political Reform Act of 1974 (the "Act "), which (1) requires such persons to
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disclose any financial interest that may foreseeably be materially affected by the work
performed under this Agreement, and (2) prohibits such persons from making, or
participating in making, decisions that will foreseeably financially affect such interest.
If subject to the Act, Consultant shall conform to all requirements of the Act.
Failure to do so constitutes a material breach and is grounds for immediate termination
of this Agreement by City. Consultant shall indemnify and hold harmless City for any
and all claims for damages resulting from Consultant's violation of this Section.
24. NOTICES
All notices, demands, requests or approvals to be given under the terms of this
Agreement shall be given in writing, and conclusively shall be deemed served when
delivered personally, or on the third business day after the deposit thereof in the United
States mail, postage prepaid, first -class mail, addressed as hereinafter provided. All
notices, demands, requests or approvals from Consultant to City shall be addressed to
City at:
Attn: Dan Matusiewicz
Administrative Services Department
City of Newport Beach
PO Box 1768
3300 Newport Boulevard
Newport Beach, CA 92658
Phone: (949) 644 -3126
Fax: (949) 644 -3339
All notices, demands, requests or approvals from CITY to Consultant shall be
addressed to Consultant at:
Attn: David R. McEwen
Stradling Yocca Carlson & Rauth
660 Newport Center Dr., Suite 1600
Newport Beach, CA 92660 -6422
Phone: (949) 725 -4162
Fax: (949) 823 -5162
25. TERMINATION
In the event that either party fails or refuses to perform any of the provisions of
this Agreement at the time and in the manner required, that party shall be deemed in
default in the performance of this Agreement. If such default is not cured within a period
of two (2) calendar days, or if more than two (2) calendar days are reasonably required
to cure the default and the defaulting party fails to give adequate assurance of due
performance within two (2) calendar days after receipt of written notice of default,
specifying the nature of such default and the steps necessary to cure such default, and
thereafter diligently take steps to cure the default, the non - defaulting party may
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terminate the Agreement forthwith by giving to the defaulting party written notice
thereof.
Notwithstanding the above provisions, City shall have the right, at its sole
discretion and without cause, of terminating this Agreement at any time by giving seven
(7) calendar days prior written notice to Consultant. In the event of termination under
this Section, City shall pay Consultant for services satisfactorily performed and costs
incurred up to the effective date of termination for which Consultant has not been
previously paid. On the effective date of termination, Consultant shall deliver to City all
reports, Documents and other information developed or accumulated in the
performance of this Agreement, whether in draft or final form.
26. COMPLIANCE WITH ALL LAWS
Consultant shall at its own cost and expense comply with all statutes,
ordinances, regulations and requirements of all governmental entities, including federal,
state, county or municipal, whether now in force or hereinafter enacted. In addition, all
work prepared by Consultant shall conform to applicable City, county, state and federal
laws, rules, regulations and permit requirements and be subject to approval of the
Project Administrator and City.
27. WAIVER
A waiver by either party of any breach, of any term, covenant or condition
contained herein shall not be deemed to be a waiver of any subsequent breach of the
same or any other term, covenant or condition contained herein, whether of the same or
a different character.
28. INTEGRATED CONTRACT
This Agreement represents the full and complete understanding of every kind or
nature whatsoever between the parties hereto, and all preliminary negotiations and
agreements of whatsoever kind or nature are merged herein. No verbal agreement or
implied covenant shall be held to vary the provisions herein.
29. CONFLICTS OR INCONSISTENCIES
In the event there are any conflicts or inconsistencies between this Agreement
and the Scope of Services or any other attachments attached hereto, the terms of this
Agreement shall govern.
30. INTERPRETATION
The terms of this Agreement shall be construed in accordance with the meaning
of the language used and shall not be construed for or against either party by reason of
the authorship of the Agreement or any other rule of construction which might otherwise
apply.
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31. AMENDMENTS
This Agreement may be modified or amended only by a written document
executed by both Consultant and City and approved as to form by the City Attorney.
32. SEVERABILITY
If any term or portion of this Agreement is held to be invalid, illegal, or otherwise
unenforceable by a court of competent jurisdiction, the remaining provisions of this
Agreement shall continue in full force and effect.
33. CONTROLLING LAW AND VENUE
The laws of the State of California shall govern this Agreement and all matters
relating to it and any action brought relating to this Agreement shall be adjudicated in a
court of competent jurisdiction in the County of Orange.
34. EQUAL OPPORTUNITY EMPLOYMENT
Consultant represents that it is an equal opportunity employer and it shall not
discriminate against any subcontractor, employee or applicant for employment because
of race, religion, color, national origin, handicap, ancestry, sex or age.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed on the day and year first written above.
APPROVED AS TO FORM:
OFFICE OF THE CITY ATTORNEY
Leonie Mulvihill,
Assistant City Attorney
City of Newport Beach
ATTEST:
Leilani I. Brown, City Clerk
City of Newport Beach
CITY OF NEWPORT BEACH,
A Municipal Corporation
Keith D. Curry, Mayor
City of Newport Beach
CONSULTANT: Stradling Yocca Carlson
& Rauth
(Corporate Officer)
Print Name:
By:
(Financial Officer)
Title:
Print Name:
Attachments: Exhibit A — Scope of Services
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EXHIBIT A
SCOPE OF SERVICES
Services Included
The City retains Bond Counsel to provide, and Bond Counsel will provide, legal services
in connection with the issuance of the Certificates. Bond Counsel agrees to consult with
and advise City officials as to the best legal method of accomplishing the issuance of
the Certificates. Such services shall include, but not limited to, the drafting of
resolutions, agreements and other documents required for the issuance of the
Certificates and the rendering of a legal opinion (hereinafter called "the opinion ")
pertaining to the issuance of the Certificates to the effect that:
(a) The Certificates have been properly authorized, executed and delivered
and are valid binding obligations;
(b) The essential sources of security for the Certificates have been legally
provided; and
(c) Interest with respect to the Certificates is exempt from California personal
income taxation and is excluded from gross income for purposes of
federal income taxes.
Bond Counsel's services will also include compiling a sufficient record justifying the
opinion by:
(i) Researching applicable laws and ordinances relating to the Certificates;
(ii) Attending conferences and consulting with City staff and counsel
regarding such laws, and the need for amendments thereto, or additional
legislation;
(iii) Participating with any financial advisors, underwriters or other experts
retained by the City in structuring the issuance of the Certificates;
(iv) Supervising and preparing documentation of certain steps to be taken
through the issuance of the certificates including:
a. Drafting all resolutions, rules and regulations, and other legal
documents relating to the security of the Certificates, in consultation
with City, its counsel, financial advisors, underwriter and other experts;
b. Preparing the record of proceedings for the authorization, sale and
issuance of the Certificates;
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c. Reviewing those portions of the official statement or placement
memorandum for the Certificates which describe the Certificates, the
financing documents prepared by us and our opinion;
d. Reviewing the purchase contract or the bidding documents for the
Certificates and participating in the related negotiations;
e. Attending informational meetings and other conferences scheduled by
the City, the financial advisors or the underwriter;
f. Consulting with prospective purchasers of the Certificates, their legal
counsel and rating agencies;
g. Consulting with counsel to City concerning any legislation or litigation
during the course of the financings;
h. Consulting with the trustee for the Certificates, and counsel to the
trustee;
L Preparing the form of the Certificates, and supervising their production
or printing, signing, authentication and delivery;
Rendering the final approving opinion as to the validity of the
Certificates for use and distribution upon their issuance; and
k. Rendering any necessary collateral legal opinions as to the
applicability of the registration requirements of federal securities laws.
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PROFESSIONAL SERVICES AGREEMENT WITH
HAWKINS DELAFIELD & WOOD, LLP FOR
DISCLOSURE COUNSEL SERVICES
THIS AGREEMENT is made and entered into as of this day of
, 2010 ( "Effective Date "), by and between the CITY OF NEWPORT
BEACH, a Municipal Corporation ( "City "), HAWKINS DELAFIELD & WOOD, LLP, A
California Professional Corporation, whose address is: 333 South Grand Avenue, Suite
3650, Los Angeles, California 90071 ( "Consultant"), and is made with reference to the
following:
RECITALS
A. City is a municipal corporation duly organized and validly existing under
the laws of the State of California with the power to carry on its business as it is now
being conducted under the statutes of the State of California and the Charter of City.
B. City is contemplating financing the construction of various public
improvements through the issuance and sale of municipal securities such as lease
revenue bonds ('Bonds "). Potential public improvements that may be financed by the
issuance of Bonds include, but are not limited to, the development and construction of a
new Civic Center, Sunset Ridge Park, Marina Park, and the Oasis Senior Center,
Bonds may also be used to refinance the outstanding Central Library Certificates of
Participation (Refunded Series 1992) ( "COPs "). Collectively, all the contemplated public
improvements, Bonds and COPS refinancing shall be referred to as the 'Project'.
C. City desires to engage Consultant as disclosure counsel in connection
with the proposed Project.
D. Consultant possesses the skill, experience, ability, background,
certification and knowledge to provide the services described in this Agreement.
E. The principal attorney with the Consultant for purposes of the Project shall
be Arto C. Becker.
F. City has solicited and received a proposal from Consultant, has reviewed
the previous experience and evaluated the expertise of Consultant, and desires to retain
Consultant to render professional services under the terms and conditions set forth in
this Agreement.
NOW, THEREFORE, it is mutually agreed by and between the undersigned
parties as follows:
1. TERM
The term of this Agreement shall commence on the Effective Date, and shall
terminate upon either the issuance of the Bonds and completion of all Project work or
on 31St day of March 2011, whichever is sooner.
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2. SERVICES TO BE PERFORMED; EXCLUDED SERVICES
Consultant shall diligently perform all the services described under the heading
"Services Included" in the Scope of Services attached hereto as Exhibit A and
incorporated herein by reference. The City may elect to delete certain tasks of the
Scope of Services at its sole discretion.
3. TIME OF PERFORMANCE
Time is of the essence in the performance of services under this Agreement and
the services shall be performed to completion in a diligent and timely manner. The
failure by Consultant to perform the services in a diligent and timely manner may result
in termination of this Agreement by City.
4. COMPENSATION TO CONSULTANT
Consultant's compensation for all work performed in accordance with this
Agreement, contingent upon issuance of the bonds, shall be the total sum of Sixty
Thousand Dollars and no /100 ($60,000.00). The total sum shall not be exceeded
without prior written authorization from City. In the event that no Bonds are sold,
Consultant shall only be entitled to be reimbursed for reimbursable items set forth
herein and shall not be entitled to any fees or other compensation under this
Agreement.
4.1 City shall reimburse Consultant for those costs or expenses specifically
approved in this Agreement, or specifically approved in writing in advance by City.
Unless otherwise approved, such costs shall be limited not to exceed Two Thousand
Dollars and no /100 ($2,000.00) and include nothing more than the following costs
incurred by Consultant:
A. Document reproduction charges, overnight delivery and messenger
charges, telecommunication charges, printing costs, filing fees, and long distance
telephone calls.
B. Actual costs and /or other costs and /or payments specifically
authorized in advance in writing by City and incurred by Consultant in the performance
of this Agreement.
4.2 Consultant shall not receive any compensation for Extra Work performed
without the prior written authorization of City. As used herein, "Extra Work" means any
work that is determined by City to be necessary for the proper completion of the Project,
but which is not included within the Scope of Services and which the parties did not
reasonably anticipate would be necessary at the execution of this Agreement. Extra
Work shall be mutually agreed upon in writing prior to the commencement of any Extra
Work.
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5. PROJECT MANAGER
Consultant shall designate a Project Manager, who shall coordinate all phases of
the Project. This Project Manager shall be available to City at all reasonable times
during the Agreement term. Consultant has designated Arto C. Becker to be its
Project Manager. Consultant shall not remove or reassign the Project Manager without
the prior written consent of City. City's approval shall not be unreasonably withheld.
Consultant, at the sole discretion of City, shall remove from the Project any of its
personnel assigned to the performance of services upon written request of City.
Consultant warrants that it will continuously furnish the necessary personnel to
complete the Project on a timely basis as contemplated by this Agreement.
6. ADMINISTRATION
This Agreement will be administered by the Administrative Services
Department. Dan Matusiewicz shall be the Project Administrator and shall have the
authority to act for City under this Agreement. The Project Administrator or his
authorized representative shall represent City in all matters pertaining to the services to
be rendered pursuant to this Agreement.
7. CITY'S RESPONSIBILITIES
To assist Consultant in the execution of its responsibilities under this Agreement,
City agrees to, where applicable, provide access to, and upon request of Consultant,
one copy of all existing relevant information on file at City. City will provide all such
materials in a timely manner so as not to cause delays in Consultant's work schedule.
8. STANDARD OF CARE
8.1 All of the services shall be performed by Consultant or under Consultant's
supervision. Consultant represents that it possesses the professional and technical
personnel required to perform the services required by this Agreement, and that it will
perform all services in a manner commensurate with community professional standards.
All services shall be performed by qualified and experienced personnel who are not
employed by City, nor have any contractual relationship with City. By delivery of
completed work, Consultant certifies that the work conforms to the requirements of this
Agreement and all applicable federal, state and local laws and the professional standard
of care.
8.2 Consultant represents and warrants to City that it has, shall obtain, and
shall keep in full force in effect during the term hereof, at its sole cost and expense, all
licenses, permits, qualifications, insurance and approvals of whatsoever nature that is
legally required of Consultant to practice its profession. Consultant shall obtain and
maintain a City of Newport Beach business license during the term of this Agreement.
8.3 Consultant shall not be responsible for delay, nor shall Consultant be
responsible for damages or be in default or deemed to be in default by reason of strikes,
lockouts, accidents, or acts of God, or the failure of City to furnish timely information or
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to approve or disapprove Consultant's work promptly, or delay or faulty performance by
City, contractors, or governmental agencies.
9. HOLD HARMLESS
To the fullest extent permitted by law, Consultant shall defend City, its City
Council, boards and commissions, officers, agents, volunteers, and employees
(collectively, the "Indemnified Parties ") against any and all claims (including, without
limitation, claims for bodily injury, death or damage to property), investigations,
challenges, demands, obligations, damages, actions, causes of action, suits, losses,
judgments, fines, penalties, liabilities, costs and expenses (including, without limitation,
attorney's fees, disbursements and court costs) of every kind and nature whatsoever
(individually, a Claim; collectively, "Claims "), which may arise from or in any manner
relate (directly or indirectly) to any breach of the terms and conditions of this
Agreement, any Work performed or Services provided under this Agreement including,
without limitation, defects in workmanship or materials or Consultant's presence or
activities conducted on the Project (including the negligent and /or willful acts, errors
and /or omissions of Consultant, its principals, officers, agents, employees, vendors,
suppliers, subconsultants, subcontractors, anyone employed directly or indirectly by any
of them or for whose acts they may be liable or any or all of them).
To the fullest extent permitted by law, Consultant shall indemnify and hold
harmless City, its City Council, boards and commissions, officers, agents, volunteers,
and employees (collectively, the "Indemnified Parties') from and against any and all
claims (including, without limitation, claims for bodily injury, death or damage to
property), demands, obligations, damages, actions, causes of action, suits, losses,
judgments, fines, penalties, liabilities, costs and expenses (including, without limitation,
attorney's fees, disbursements and court costs) of every kind and nature whatsoever
(individually, a Claim; collectively, "Claims "), which is proximately caused by any breach
of the terms and conditions of this Agreement and any Work performed or Services
provided under this Agreement (including the negligent and /or willful acts, errors and/or
omissions of Consultant, its principals, officers, agents, employees, anyone employed
directly or indirectly by any of them or for whose acts they may be liable or any or all of
them).
Notwithstanding the foregoing, nothing herein shall be construed to require
Consultant to indemnify the Indemnified Parties from any Claim arising from the sole
negligence or willful misconduct of the Indemnified Parties. Nothing in this indemnity
shall be construed as authorizing any award of attorney's fees in any action on or to
enforce the terms of this Agreement. This indemnity shall apply to all claims and liability
regardless of whether any insurance policies are applicable. The policy limits do not act
as a limitation upon the amount of indemnification to be provided by the Consultant.
10. INDEPENDENT CONTRACTOR
It is understood that City retains Consultant on an independent contractor basis
and Consultant is not an agent or employee of City. The manner and means of
conducting the work are under the control of Consultant, except to the extent they are
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limited by statute, rule or regulation and the expressed terms of this Agreement.
Nothing in this Agreement shall be deemed to constitute approval for Consultant or any
of Consultant's employees or agents, to be the agents or employees of City. Consultant
shall have the responsibility for and control over the means of performing the work,
provided that Consultant is in compliance with the terms of this Agreement. Anything in
this Agreement that may appear to give City the right to direct Consultant as to the
details of the performance or to exercise a measure of control over Consultant shall
mean only that Consultant shall follow the desires of City with respect to the results of
the services.
11. COOPERATION
Consultant agrees to work closely and cooperate fully with City's designated
Project Administrator and any other agencies that may have jurisdiction or interest in the
work to be performed. City agrees to cooperate with the Consultant on the Project.
12. CITY POLICY
Consultant shall discuss and review all matters relating to policy and Project
direction with City's Project Administrator in advance of all critical decision points in
order to ensure the Project proceeds in a manner consistent with City goals and
policies.
13. PROGRESS
Consultant is responsible for keeping the Project Administrator and /or his duly
authorized designee informed on a regular basis regarding the status and progress of
the Project, activities performed and planned, and any meetings that have been
scheduled or are desired.
14. INSURANCE
Without limiting Consultant's indemnification of City, and prior to commencement
of work, Consultant shall obtain, provide and maintain at its own expense during the
term of this Agreement, policies of insurance of the type and amounts described below
and in a form satisfactory to City.
A. Proof of Insurance. Consultant shall provide certificates of insurance to
City as evidence of the insurance coverage required herein, along with a
waiver of subrogation endorsement for workers' compensation. Insurance
certificates and endorsement must be approved by City's Risk Manager
prior to commencement of performance. Current certification of insurance
shall be kept on file with City at all times during the term of this contract.
City reserves the right to require complete, certified copies of all required
insurance policies, at any time.
Consultant shall procure and maintain for the duration of the contract
insurance against claims for injuries to persons or damages to property,
which may arise from or in connection with the performance of the Work
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hereunder by Consultant, his agents, representatives, employees or
subconsultants. The cost of such insurance shall be included in
Consultant's bid.
B. Acceptable Insurers. All insurance policies shall be issued by an
insurance company currently authorized by the Insurance Commissioner
to transact business of insurance in the State of California, with an
assigned policyholders' Rating of A- (or higher) and Financial Size
Category Class VII (or larger) in accordance with the latest edition of
Best's Key Rating Guide, unless otherwise approved by the City's Risk
Manager.
C. Coverage Requirements.
i. Workers' Compensation Coverage. Consultant shall maintain
Workers' Compensation Insurance (Statutory Limits) and
Employer's Liability Insurance (with limits of at least one million
dollars ($1,000,000)) for Consultant's employees in accordance
with the laws of the State of California, Section 3700 of the Labor
Code In addition, Consultant shall require each subconsultant to
similarly maintain Workers' Compensation Insurance and
Employer's Liability Insurance in accordance with the laws of the
State of California, Section 3700 for all of the subconsultant's
employees.
Any notice of cancellation or non - renewal of all Workers'
Compensation policies must be received by City at least thirty (30)
calendar days (ten (10) calendar days written notice of non-
payment of premium) prior to such change.
Consultant shall submit to City, along with the certificate of
insurance, a Waiver of Subrogation endorsement in favor of City, its
officers, agents, employees and volunteers.
ii. General Liability Coverage. Consultant shall maintain commercial
general liability insurance in an amount not less than one million
dollars ($1,000,000) per occurrence for bodily injury, personal
injury, and property damage, including without limitation, blanket
contractual liability.
iii. Automobile Liability Coverage. Consultant shall maintain
automobile insurance covering bodily injury and property damage
for all activities of the Consultant arising out of or in connection with
Work to be performed under this Agreement, including coverage for
any owned, hired, non -owned or rented vehicles, in an amount not
less than one million dollars ($1,000,000) combined single limit for
each accident.
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iv. Professional Liability (Errors & Omissions) Coverage. Consultant
shall maintain professional liability insurance that covers the
Services to be performed in connection with this Agreement, in the
minimum amount of five million dollars ($5,000,000) limit per claim
and in the aggregate.
D. Other Insurance Provisions or Requirements.
The policies are to contain, or be endorsed to contain, the following provisions:
i. Waiver of Subrogation. All insurance coverage maintained or
procured pursuant to this agreement shall be endorsed to waive
subrogation against City, its elected or appointed officers, agents,
officials, employees and volunteers or shall specifically allow
Consultant or others providing insurance evidence in compliance
with these requirements to waive their right of recovery prior to a
loss. Consultant hereby waives its own right of recovery against
City, and shall require similar written express waivers and
insurance clauses from each of its subconsultants.
ii. Enforcement of Contract Provisions. Consultant acknowledges and
agrees that any actual or alleged failure on the part of the City to
inform Consultant of non - compliance with any requirement imposes
no additional obligations on the City nor does it waive any rights
hereunder.
iii. Requirements not Limiting. Requirements of specific coverage
features or limits contained in this Section are not intended as a
limitation on coverage, limits or other requirements, or a waiver of
any coverage normally provided by any insurance. Specific
reference to a given coverage feature is for purposes of clarification
only as it pertains to a given issue and is not intended by any party
or insured to be all inclusive, or to the exclusion of other coverage,
or a waiver of any type.
iv. Notice of Cancellation. Consultant agrees to oblige its insurance
agent or broker and insurers to provide to City with thirty (30) days
notice of cancellation (except for nonpayment for which ten (10)
days notice is required) or nonrenewal of coverage for each
required coverage.
E. Timely Notice of Claims. Consultant shall give City prompt and timely
notice of claims made or suits instituted that arise out of or result from
Consultant's performance under this Agreement.
F. Additional Insurance. Consultant shall also procure and maintain, at its
own cost and expense, any additional kinds of insurance, which in its own
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judgment may be necessary for its proper protection and prosecution of
the Work.
15. PROHIBITION AGAINST ASSIGNMENTS AND TRANSFERS
Except as specifically authorized under this Agreement, the services to be
provided under this Agreement shall not be assigned, transferred contracted or
subcontracted out without the prior written approval of City. Any of the following shall
be construed as an assignment: The sale, assignment, transfer or other disposition of
any of the issued and outstanding capital stock of Consultant, or of the interest of any
general partner or joint venturer or syndicate member or cotenant if Consultant is a
partnership or joint- venture or syndicate or cotenancy, which shall result in changing the
control of Consultant. Control means fifty percent (50 %) or more of the voting power, or
twenty -five percent (25 %) or more of the assets of the corporation, partnership or joint -
venture.
16. SUBCONTRACTING
The parties recognize that a substantial inducement to City for entering into this
Agreement is the professional reputation, experience and competence of Consultant.
Assignments of any or all rights, duties or obligations of the Consultant under this
Agreement will be permitted only with the express written consent of City. Consultant
shall not subcontract any portion of the work to be performed under this Agreement
without the prior written authorization of City.
17. OWNERSHIP OF DOCUMENTS
Each and every report, draft, document and other writing produced (hereinafter
"Documents "), prepared or caused to be prepared by Consultant, its officers,
employees, agents and subcontractors, in the course of implementing this Agreement,
shall become the exclusive property of City, and City shall have the sole right to use
such materials in its discretion without further compensation to Consultant or any other
party. Consultant shall, at Consultant's expense, provide such Documents to City upon
prior written request.
Documents prepared by Consultant pursuant to this Agreement are not intended
or represented to be suitable for reuse by City or others on any other project. Any use
of completed Documents for other projects and any use of incomplete Documents
without specific written authorization from Consultant will be at City's sole risk and
without liability to Consultant. Further, any and all liability arising out of changes made
to Consultant's deliverables under this Agreement by City or persons other than
Consultant is waived against Consultant and City assumes full responsibility for such
changes unless City has given Consultant prior notice and has received from
Consultant written consent for such changes.
18. CONFIDENTIALITY
All Documents, including drafts, notes and communications that result from the
services in this Agreement, shall be kept confidential unless City authorizes in writing
the release of information.
19. RECORDS
Consultant shall keep records and invoices in connection with the work to be
performed under this Agreement. Consultant shall maintain complete and accurate
records with respect to the costs incurred under this Agreement and any services,
expenditures and disbursements charged to City, for a minimum period of three (3)
years, or for any longer period required by law, from the date of final payment to
Consultant under this Agreement. All such records and invoices shall be clearly
identifiable. Consultant shall allow a representative of City to examine, audit and make
transcripts or copies of such records and invoices during regular business hours.
Consultant shall allow inspection of all work, data, Documents, proceedings and
activities related to the Agreement for a period of three (3) years from the date of final
payment to Consultant under this Agreement.
20. WITHHOLDINGS
City may withhold payment to Consultant of any disputed sums until satisfaction
of the dispute with respect to such payment. Such withholding shall not be deemed to
constitute a failure to pay according to the terms of this Agreement. Consultant shall
not discontinue work as a result of such withholding. Consultant shall have an
immediate right to appeal to the City Manager or his /her designee with respect to such
disputed sums. Consultant shall be entitled to receive interest on any withheld sums at
the rate of return that City earned on its investments during the time period, from the
date of withholding of any amounts found to have been improperly withheld.
21. ERRORS AND OMISSIONS
In the event of errors or omissions that are due to the negligence or professional
inexperience of Consultant which result in expense to City greater than what would
have resulted if there were not errors or omissions in the work accomplished by
Consultant, the additional expense shall be borne by Consultant. Nothing in this
paragraph is intended to limit City's rights under the law or any other sections of this
Agreement.
22. CITY'S RIGHT TO EMPLOY OTHER CONSULTANTS
City reserves the right to employ other Consultants in connection with the
Project.
23. CONFLICTS OF INTEREST
The Consultant or its employees may be subject to the provisions of the
California Political Reform Act of 1974 (the "Act "), which (1) requires such persons to
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disclose any financial interest that may foreseeably be materially affected by the work
performed under this Agreement, and (2) prohibits such persons from making, or
participating in making, decisions that will foreseeably financially affect such interest.
If subject to the Act, Consultant shall conform to all requirements of the Act.
Failure to do so constitutes a material breach and is grounds for immediate termination
of this Agreement by City. Consultant shall indemnify and hold harmless City for any
and all claims for damages resulting from Consultant's violation of this Section.
24. NOTICES
All notices, demands, requests or approvals to be given under the terms of this
Agreement shall be given in writing, and conclusively shall be deemed served when
delivered personally, or on the third business day after the deposit thereof in the United
States mail, postage prepaid, first -class mail, addressed as hereinafter provided. All
notices, demands, requests or approvals from Consultant to City shall be addressed to
City at:
Attn: Dan Matusiewicz
Administrative Services Department
City of Newport Beach
PO Box 1768
3300 Newport Boulevard
Newport Beach, CA 92658
Phone: (949) 644 -3126
Fax: (949) 644 -3339
All notices, demands, requests or approvals from CITY to Consultant shall be
addressed to Consultant at:
Attn: Arlo C. Becker
Hawkins Delafield & Wood, LLP
333 South Grand Avenue
Suite 3650
Los Angeles, CA 90071
Phone: (213) 236 -9050
Fax: (213) 236 -9060
25. TERMINATION
In the event that either party fails or refuses to perform any of the provisions of
this Agreement at the time and in the manner required, that party shall be deemed in
default in the performance of this Agreement. If such default is not cured within a period
of two (2) calendar days, or if more than two (2) calendar days are reasonably required
to cure the default and the defaulting party fails to give adequate assurance of due
performance within two (2) calendar days after receipt of written notice of default,
specifying the nature of such default and the steps necessary to cure such default, and
thereafter diligently take steps to cure the default, the non - defaulting party may
10
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terminate the Agreement forthwith by giving to the defaulting party written notice
thereof.
Notwithstanding the above provisions, City shall have the right, at its sole
discretion and without cause, of terminating this Agreement at any time by giving seven
(7) calendar days prior written notice to Consultant. In the event of termination under
this Section, City shall pay Consultant for services satisfactorily performed and costs
incurred up to the effective date of termination for which Consultant has not been
previously paid. On the effective date of termination, Consultant shall deliver to City all
reports, Documents and other information developed or accumulated in the
performance of this Agreement, whether in draft or final form.
26. COMPLIANCE WITH ALL LAWS
Consultant shall at its own cost and expense comply with all statutes,
ordinances, regulations and requirements of all governmental entities, including federal,
state, county or municipal, whether now in force or hereinafter enacted. In addition, all
work prepared by Consultant shall conform to applicable City, county, state and federal
laws, rules, regulations and permit requirements and be subject to approval of the
Project Administrator and City.
27. WAIVER
A waiver by either party of any breach, of any term, covenant or condition
contained herein shall not be deemed to be a waiver of any subsequent breach of the
same or any other term, covenant or condition contained herein, whether of the same or
a different character.
28. INTEGRATED CONTRACT
This Agreement represents the full and complete understanding of every kind or
nature whatsoever between the parties hereto, and all preliminary negotiations and
agreements of whatsoever kind or nature are merged herein. No verbal agreement or
implied covenant shall be held to vary the provisions herein.
29. CONFLICTS OR INCONSISTENCIES
In the event there are any conflicts or inconsistencies between this Agreement
and the Scope of Services or any other attachments attached hereto, the terms of this
Agreement shall govern.
30. INTERPRETATION
The terms of this Agreement shall be construed in accordance with the meaning
of the language used and shall not be construed for or against either party by reason of
the authorship of the Agreement or any other rule of construction which might otherwise
apply.
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31. AMENDMENTS
This Agreement may be modified or amended only by a written document
executed by both Consultant and City and approved as to form by the City Attorney.
32. SEVERABILITY
If any term or portion of this Agreement is held to be invalid, illegal, or otherwise
unenforceable by a court of competent jurisdiction, the remaining provisions of this
Agreement shall continue in full force and effect.
33. CONTROLLING LAW AND VENUE
The laws of the State of California shall govern this Agreement and all matters
relating to it and any action brought relating to this Agreement shall be adjudicated in a
court of competent jurisdiction in the County of Orange.
34. EQUAL OPPORTUNITY EMPLOYMENT
Consultant represents that it is an equal opportunity employer and it shall not
discriminate against any subcontractor, employee or applicant for employment because
of race, religion, color, national origin, handicap, ancestry, sex or age.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed on the day and year first written above.
APPROVED AS TO FORM:
OFFICE OF THE CITY ATTORNEY
By I ' yvvy W
eonie Mulvihill,
Assistant City Attorney
City of Newport Beach
ATTEST:
By:
Leilani 1. Brown, City Clerk
City of Newport Beach
CITY OF NEWPORT BEACH,
A Municipal Corporation
0
Keith D. Curry, Mayor
City of Newport Beach
CONSULTANT: Hawkins Delafield &
Wood, LLP
0
(Corporate Officer)
Print Na
(Financial Officer)
Print
Attachments: Exhibit A — Scope of Services
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EXHIBIT A
SCOPE OF SERVICES
Services Included
The legal services to be provided by the Firm shall include:
(a) Preparation of the preliminary official statement and official statement
pertaining to each series of the bonds issued for the project to ensure compliance with
all applicable securities regulations, such effort to include undertaking of appropriate
due diligence in the review of all transactional documents, applicable state and federal
law, closing documents and opinions and all other necessary documentation;
(b) Participation in the hearings related to the proceedings, and attending any
other meetings where attendance is requested by the City;
(c) Preparation or review of the bond purchase agreement with the
underwriter for the sale of each series of the bonds to be sold on a negotiated basis or
of the notice of sale for the sale of each series of the bonds to be sold on a competitive
basis;
(d) Preparation of any undertaking pertaining to the ongoing disclosure
requirements for the bonds to insure compliance with Rule 15c2 -12;
(e) Consult with and advise staff and other members of the financing team
regarding disclosure issues and the disclosure obligations of the City;
(f) Provision of an appropriate 10(b)5 opinion to the City and the underwriter
of the bonds; and
(g) Review of all required closing documentation to ensure all closing
requirements as specified in the official statement and other applicable disclosure
documents have been complied with prior to closing.
A -t
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PROFESSIONAL SERVICES AGREEMENT WITH
THE REAL ESTATE APPRAISAL OFFICES OF WILLIAM R. HANSEN FOR
REAL ESTATE APPRAISAL AND VALUATION SERVICES
THIS AGREEMENT is made and entered into as of this day of ,
2010, by and between the CITY OF NEWPORT BEACH, a Municipal Corporation
( "City "), and WILLIAM R. HANSEN, MAI, whose address is: 3334 E. Coast Highway,
#295, Corona del Mar, California, 92625 ( "Consultant "), and is made with reference to
the following:
RECITALS
A. City is a municipal corporation duly organized and validly existing under the laws
of the State of California with the power to carry on its business as it is now being
conducted under the statutes of the State of California and the Charter of City.
B. In connection with a contemplated financing of various public improvements, City
is in need of appraisal and valuation services to determine the value and annual
rental value of City -owned properties including some or all of the properties listed
in Exhibit B and potentially additional City -owned properties of a similar nature
and use that may be necessary to support the needs of the contemplated
financing. All the appraisal services shall be referred to as the 'Project'.
C. The City desires to retain the professional and technical services of the
Consultant for the purpose of providing real estate appraisal and valuation
services as they pertain to the Project.
D. Consultant possesses the skill, experience, ability, background, certification and
knowledge to provide the services described in this Agreement.
E. Consultant has designated independent appraisers William R. Hansen and Gary
L. Vogt as the principal consultants for purposes of the Project.
F. City has solicited and received a proposal from Consultant, has reviewed the
previous experience and evaluated the expertise of Consultant, and desires to
retain Consultant to render professional services under the terms and conditions
set forth in this Agreement.
NOW, THEREFORE, it is mutually agreed by and between the undersigned parties as
follows:
1. TERM
The term of this Agreement shall commence on the above written date, and shall
terminate upon completion of all Project work or on 15th day of September 2010,
whichever is sooner.
2. SERVICES TO BE PERFORMED
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3.
4.
Consultant shall diligently perform all the services described in the Scope of
Services attached hereto as Exhibit A and incorporated herein by reference
( "Services "). The City may elect to delete certain tasks of the Scope of Services
at its sole discretion. The Services shall be performed in two phases, which are
described as Phase 1 and Phase 2 as follows: Phase 1 includes the individual
property inspections, data search, preliminary estimate of the property value,
estimated annualized property value and a proposal for Phase 2 fees for each
property. Upon delivery of the Phase 1 report, City will determine which properties
the Consultant will prepare Phase 2 summary appraisal report(s).
TIME OF PERFORMANCE
Time is of the essence in the performance of services under this Agreement and
the Services shall be performed to completion in a diligent and timely manner.
The failure by Consultant to perform the services in a diligent and timely manner
may result in termination of this Agreement by City.
COMPENSATION TO CONSULTANT
City shall pay Consultant for Services in accordance with the provisions of this
Section. Compensation to the Consultant associated with this Agreement shall
not exceed the amounts set forth in schedule set forth in Section 4.1 and 4.2. No
billing rate changes shall be made during the term of this Agreement without the
prior written approval of City.
4.1 Phase 1 Appraisal Services ......................... .....................$25,000.00
Consultant shall provide an invoice for Phase 1 services upon delivery of
the Phase 1 report. Consultant's bills shall include a brief description of
the Services performed and the applicable phase of the work completed.
City shall pay Consultant no later than thirty (30) days after acceptance of
the report.
4.2 Phase 2, Appraisal Services Fee .............................. $1,000 to $2,000
per Appraisal Report Property
Upon completion of Phase 1 services, City will selectively authorize the
Consultant to complete a summary appraisal report ( "Appraisal Report")
on some or all of the properties in Exhibit B at the per property fee quoted
by Consultant at the end of Phase 1 which is not to exceed $2,000 per
property. Consultant shall provide City invoices upon delivery of report(s).
City shall pay Consultant no later than thirty (30) days after acceptance of
the report.
4.3 Consultant shall not receive any compensation for Extra Work performed
without the prior written authorization of City. As used herein, "Extra
Work" means any work or additional Appraisal Reports properties not
contemplated in Exhibit B that is determined by City to be necessary for
the proper completion of the Project, but which is not included within the
Scope of Services and which the parties did not reasonably anticipate
would be necessary at the execution of this Agreement.
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5. PROJECT MANAGER
Consultant shall designate a Project Manager, who shall coordinate all phases of
the Project. This Project Manager shall be available to City at all reasonable
times during the Agreement term. Consultant has designated William R. Hansen
as Project Manager. Consultant shall not remove or reassign the Project
Manager without the prior written consent of City. City's approval shall not be
unreasonably withheld.
Consultant, at the sole discretion of City, shall remove from the Project any of its
personnel assigned to the performance of services upon written request of City.
Consultant warrants that it will continuously furnish the necessary personnel to
complete the Project on a timely basis as contemplated by this Agreement.
6. ADMINISTRATION
This Agreement will be administered by the Administrative Services
Department. Dan Matusiewicz shall be the Project Administrator and shall have
the authority to act for City under this Agreement. The Project Administrator or
his /her authorized representative shall represent City in all matters pertaining to
the services to be rendered pursuant to this Agreement.
7. CITY'S RESPONSIBILITIES
To assist Consultant in the execution of its responsibilities under this Agreement,
City agrees to, where applicable provide access to, and upon request of
Consultant, one copy of all existing relevant information on file at City. City will
provide all such materials in a timely manner so as not to cause delays in
Consultant's work schedule.
8. STANDARD OF CARE
8.1 All of the services shall be performed by Consultant or under Consultant's
supervision. Consultant represents that it possesses the professional and
technical personnel required to perform the services required by this
Agreement, and that it will perform all services in a manner commensurate
with community professional standards. All services shall be performed
by qualified and experienced personnel who are not employed by City, nor
have any contractual relationship with City. By delivery of completed
work, Consultant certifies that the work conforms to the requirements of
this Agreement and all applicable federal, state and local laws and the
professional standard of care.
8.2 Consultant represents and warrants to City that it has, shall obtain, and
shall keep in full force in effect during the term hereof, at its sole cost and
expense, all licenses, permits, qualifications, insurance and approvals of
whatsoever nature that is legally required of Consultant to practice its
profession. Consultant shall maintain a City of Newport Beach business
license during the term of this Agreement.
3 1 55
8.3 Consultant shall not be responsible for delay, nor shall Consultant be
responsible for damages or be in default or deemed to be in default by
reason of strikes, lockouts, accidents, or acts of God, or the failure of City
to furnish timely information or to approve or disapprove Consultant's work
promptly, or delay or faulty performance by City, contractors, or
governmental agencies.
9. HOLD HARMLESS
To the fullest extent permitted by law, Consultant shall indemnify, defend and
hold harmless City, its City Council, boards and commissions, officers, agents,
volunteers, and employees (collectively, the "Indemnified Parties ") from and
against any and all claims (including, without limitation, claims for bodily injury,
death or damage to property), demands, obligations, damages, actions, causes
of action, suits, losses, judgments, fines, penalties, liabilities, costs and expenses
(including, without limitation, attorney's fees, disbursements and court costs) of
every kind and nature whatsoever (individually, a Claim; collectively, "Claims'),
which may arise from or in any manner relate (directly or indirectly) to any breach
of the terms and conditions of this Agreement, any work performed or services
provided under this Agreement including, without limitation, Consultant's
presence or activities conducted on the Project (including the negligent and /or
willful acts, errors and /or omissions of Consultant, its principals, officers, agents,
employees, vendors, suppliers, consultants, subcontractors, anyone employed
directly or indirectly by any of them or for whose acts they may be liable or any or
all of them).
Notwithstanding the foregoing, nothing herein shall be construed to require
Consultant to indemnify the Indemnified Parties from any Claim arising from the
sole negligence or willful misconduct of the Indemnified Parties. Nothing in this
indemnity shall be construed as authorizing any award of attorney's fees in any
action on or to enforce the terms of this Agreement. This indemnity shall apply to
all claims and liability regardless of whether any insurance policies are
applicable. The policy limits do not act as a limitation upon the amount of
indemnification to be provided by the Consultant.
10. INDEPENDENT CONTRACTOR
It is understood that City retains Consultant on an independent contractor basis
and Consultant is not an agent or employee of City. The manner and means of
conducting the work are under the control of Consultant, except to the extent
they are limited by statute, rule or regulation and the expressed terms of this
Agreement. Nothing in this Agreement shall be deemed to constitute approval
for Consultant or any of Consultant's employees or agents, to be the agents or
employees of City. Consultant shall have the responsibility for and control over
the means of performing the work, provided that Consultant is in compliance with
the terms of this Agreement. Anything in this Agreement that may appear to give
City the right to direct Consultant as to the details of the performance or to
exercise a measure of control over Consultant shall mean only that Consultant
shall follow the desires of City with respect to the results of the services.
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11. COOPERATION
Consultant agrees to work closely and cooperate fully with City's designated
Project Administrator and any other agencies that may have jurisdiction or
interest in the work to be performed. City agrees to cooperate with the
Consultant on the Project.
12. CITY POLICY
Consultant shall discuss and review all matters relating to policy and Project
direction with City's Project Administrator in advance of all critical decision points
in order to ensure the Project proceeds in a manner consistent with City goals
and policies.
13. PROGRESS
Consultant is responsible for keeping the Project Administrator and /or his /her
duly authorized designee informed on a regular basis regarding the status and
progress of the Project, activities performed and planned, and any meetings that
have been scheduled or are desired.
14. INSURANCE
Without limiting Consultant's indemnification of City, and prior to commencement
of work, Consultant shall obtain, provide and maintain at its own expense during
the term of this Agreement, a policy or policies of liability insurance of the type
and amounts described below and in a form satisfactory to City.
A. Certificates of Insurance. Consultant shall provide certificates of
insurance with original endorsements to City as evidence of the insurance
coverage required herein. Insurance certificates must be approved by
City's Risk Manager prior to commencement of performance or issuance
of any permit. Current certification of insurance shall be kept on file with
City at all times during the term of this Agreement.
B. Signature. A person authorized by the insurer to bind coverage on its
behalf shall sign certification of all required policies.
C. Acceptable Insurers. All insurance policies shall be issued by an
insurance company currently authorized by the Insurance Commissioner
to transact business of insurance in the State of California, with an
assigned policyholders' Rating of A (or higher) and Financial Size
Category Class VII (or larger) in accordance with the latest edition of
Best's Key Rating Guide, unless otherwise approved by the City's Risk
Manager.
D. Coverage Requirements.
i. Workers' Compensation Coverage. Consultant shall maintain
Workers' Compensation Insurance and Employer's Liability
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J
Insurance for his or her employees in accordance with the laws of
the State of California. In addition, Consultant shall require each
subcontractor to similarly maintain Workers' Compensation
Insurance and Employer's Liability Insurance in accordance with
the laws of the State of California for all of the subcontractor's
employees. Any notice of cancellation or non - renewal of all
Workers' Compensation policies must be received by City at least
thirty (30) calendar days (10 calendar days written notice of non-
payment of premium) prior to such change. The insurer shall agree
to waive all rights of subrogation against City, its officers, agents,
employees and volunteers for losses arising from work performed
by Consultant for City.
ii. General Liability Coverage. Consultant shall maintain commercial
general liability insurance in an amount not less than one million
dollars ($1,000,000) per occurrence for bodily injury, personal
injury, and property damage, including without limitation,
contractual liability. If commercial general liability insurance or
other form with a general aggregate limit is used, either the general
aggregate limit shall apply separately to the work to be performed
under this Agreement, or the general aggregate limit shall be at
least twice the required occurrence limit.
iii. Automobile Liability Coverage. Consultant shall maintain
automobile insurance covering bodily injury and property damage
for all activities of the Consultant arising out of or in connection with
work to be performed under this Agreement, including coverage for
any owned, hired, non -owned or rented vehicles, in an amount not
less than one million dollars ($1,000,000) combined single limit for
each occurrence.
iv. Professional Errors and Omissions Insurance. Consultant shall
maintain professional errors and omissions insurance, which covers
the services to be performed in connection with this Agreement in
the minimum amount of one million dollars ($1,000,000).
E. Endorsements. Each general liability and automobile liability insurance
policy shall be endorsed with the following specific language:
The City, its elected or appointed officers, officials, employees,
agents and volunteers are to be covered as additional insurers with
respect to liability arising out of work performed by or on behalf of
the Consultant.
ii. This policy shall be considered primary insurance as respects to
City, its elected or appointed officers, officials, employees, agents
and volunteers as respects to all claims, losses, or liability arising
directly or indirectly from the Consultant's operations or services
provided to City. Any insurance maintained by City, including any
self- insured retention City may have, shall be considered excess
6 S8
insurance only and not contributory with the insurance provided
hereunder.
iii. This insurance shall act for each insured and additional insured as
though a separate policy had been written for each, except with
respect to the limits of liability of the insuring company.
iv. The insurer waives all rights of subrogation against City, its elected
or appointed officers, officials, employees, agents and volunteers.
V. Any failure to comply with reporting provisions of the policies shall
not affect coverage provided to City, its elected or appointed
officers, officials, employees, agents or volunteers.
vi. The insurance provided by this policy shall not be suspended,
voided, canceled, or reduced in coverage or in limits, by either party
except after thirty (30) calendar days (10 calendar days written
notice of non - payment of premium) written notice has been
received by City.
F. Timely Notice of Claims. Consultant shall give City prompt and timely
notice of claim made or suit instituted arising out of or resulting from
Consultant's performance under this Agreement.
G. Additional Insurance. Consultant shall also procure and maintain, at its
own cost and expense, any additional kinds of insurance, which in its own
judgment may be necessary for its proper protection and prosecution of
the work.
15. PROHIBITION AGAINST ASSIGNMENTS AND TRANSFERS
Except as specifically authorized under this Agreement, the services to be
provided under this Agreement shall not be assigned, transferred contracted or
subcontracted out without the prior written approval of City. Any of the following
shall be construed as an assignment: The sale, assignment, transfer or other
disposition of any of the issued and outstanding capital stock of Consultant, or of
the interest of any general partner or joint venturer or syndicate member or
cotenant if Consultant is a partnership or joint- venture or syndicate or cotenancy,
which shall result in changing the control of Consultant. Control means fifty
percent (50 %) or more of the voting power, or twenty -five percent (25 %) or more
of the assets of the corporation, partnership or joint- venture.
16. SUBCONTRACTING
The parties recognize that a substantial inducement to City for entering into this
Agreement is the professional reputation, experience and competence of
Consultant. Assignments of any or all rights, duties or obligations of the
Consultant under this Agreement will be permitted only with the express written
consent of City. Consultant shall not subcontract any portion of the work to be
performed under this Agreement without the prior written authorization of City.
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17. OWNERSHIP OF DOCUMENTS
Each and every report, draft, document and other writing produced (hereinafter
"Documents "), prepared or caused to be prepared by Consultant, its officers,
employees, agents and subcontractors, in the course of implementing this
Agreement, shall become the exclusive property of City, and City shall have the
sole right to use such materials in its discretion without further compensation to
Consultant or any other party. Consultant shall, at Consultant's expense, provide
such Documents to City upon prior written request.
Documents prepared by Consultant pursuant to this Agreement are not intended
or represented to be suitable for reuse by City or others on any other project.
Any use of completed Documents for other projects and any use of incomplete
Documents without specific written authorization from Consultant will be at City's
sole risk and without liability to Consultant. Further, any and all liability arising
out of changes made to Consultant's deliverables under this Agreement by City
or persons other than Consultant is waived against Consultant and City assumes
full responsibility for such changes unless City has given Consultant prior notice
and has received from Consultant written consent for such changes.
18. CONFIDENTIALITY
All Documents, including drafts, notes and communications that result from the
services in this Agreement, shall be kept confidential unless City authorizes in
writing the release of information.
19. RECORDS
Consultant shall keep records and invoices in connection with the work to be
performed under this Agreement. Consultant shall maintain complete and
accurate records with respect to the costs incurred under this Agreement and
any services, expenditures and disbursements charged to City, for a minimum
period of three (3) years, or for any longer period required by law, from the date
of final payment to Consultant under this Agreement. All such records and
invoices shall be clearly identifiable. Consultant shall allow a representative of
City to examine, audit and make transcripts or copies of such records and
invoices during regular business hours. Consultant shall allow inspection of all
work, data, Documents, proceedings and activities related to the Agreement for a
period of three (3) years from the date of final payment to Consultant under this
Agreement.
20. WITHHOLDINGS
City may withhold payment to Consultant of any disputed sums until satisfaction
of the dispute with respect to such payment. Such withholding shall not be
deemed to constitute a failure to pay according to the terms of this Agreement.
Consultant shall not discontinue work as a result of such withholding. Consultant
shall have an immediate right to appeal to the City Manager or his /her designee
with respect to such disputed sums. Consultant shall be entitled to receive
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interest on any withheld sums at the rate of return that City earned on its
investments during the time period, from the date of withholding of any amounts
found to have been improperly withheld.
21. ERRORS AND OMISSIONS
In the event of errors or omissions that are due to the negligence or professional
inexperience of Consultant which result in expense to City greater than what
would have resulted if there were not errors or omissions in the work
accomplished by Consultant, the additional expense shall be borne by
Consultant. Nothing in this paragraph is intended to limit City's rights under the
law or any other sections of this Agreement.
22. CITY'S RIGHT TO EMPLOY OTHER CONSULTANTS
City reserves the right to employ other Consultants in connection with the
Project.
23. CONFLICTS OF INTEREST
The Consultant or its employees may be subject to the provisions of the
California Political Reform Act of 1974 (the "Act "), which (1) requires such
persons to disclose any financial interest that may foreseeably be materially
affected by the work performed under this Agreement, and (2) prohibits such
persons from making, or participating in making, decisions that will foreseeably
financially affect such interest.
If subject to the Act, Consultant shall conform to all requirements of the Act.
Failure to do so constitutes a material breach and is grounds for immediate
termination of this Agreement by City. Consultant shall indemnify and hold
harmless City for any and all claims for damages resulting from Consultant's
violation of this Section.
24. NOTICES
All notices, demands, requests or approvals to be given under the terms of this
Agreement shall be given in writing, and conclusively shall be deemed served
when delivered personally, or on the third business day after the deposit thereof
in the United States mail, postage prepaid, first -class mail, addressed as
hereinafter provided. All notices, demands, requests or approvals from
Consultant to City shall be addressed to City at:
Attn: Dan Matusiewicz
Administrative Services Department
City of Newport Beach
3300 Newport Boulevard
Newport Beach, CA 92663
Phone: 949 - 644 -3126
Fax: 949 - 644 -3339
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All notices, demands, requests or approvals from CITY to Consultant shall be
addressed to Consultant at:
Attn: William R. Hansen
3334 E. Coast Highway, #295
Corona Del Mar, CA 92625 -2328
Phone: 949 - 675 -7600
25. TERMINATION
In the event that either party fails or refuses to perform any of the provisions of
this Agreement at the time and in the manner required, that party shall be
deemed in default in the performance of this Agreement. If such default is not
cured within a period of two (2) calendar days, or if more than two (2) calendar
days are reasonably required to cure the default and the defaulting party fails to
give adequate assurance of due performance within two (2) calendar days after
receipt of written notice of default, specifying the nature of such default and the
steps necessary to cure such default, and thereafter diligently take steps to cure
the default, the non - defaulting party may terminate the Agreement forthwith by
giving to the defaulting party written notice thereof.
Notwithstanding the above provisions, City shall have the right, at its sole
discretion and without cause, of terminating this Agreement at any time by giving
seven (7) calendar days prior written notice to Consultant. In the event of
termination under this Section, City shall pay Consultant for services satisfactorily
performed and costs incurred up to the effective date of termination for which
Consultant has not been previously paid. On the effective date of termination,
Consultant shall deliver to City all reports, Documents and other information
developed or accumulated in the performance of this Agreement, whether in draft
or final form.
26. COMPLIANCE WITH ALL LAWS
Consultant shall at its own cost and expense comply with all statutes,
ordinances, regulations and requirements of all governmental entities, including
federal, state, county or municipal, whether now in force or hereinafter enacted.
In addition, all work prepared by Consultant shall conform to applicable City,
county, state and federal laws, rules, regulations and permit requirements and be
subject to approval of the Project Administrator and City.
27. WAIVER
A waiver by either party of any breach, of any term, covenant or condition
contained herein shall not be deemed to be a waiver of any subsequent breach
of the same or any other term, covenant or condition contained herein, whether
of the same or a different character.
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28. INTEGRATED CONTRACT
This Agreement represents the full and complete understanding of every kind or
nature whatsoever between the parties hereto, and all preliminary negotiations
and agreements of whatsoever kind or nature are merged herein. No verbal
agreement or implied covenant shall be held to vary the provisions herein.
29. CONFLICTS OR INCONSISTENCIES
In the event there are any conflicts or inconsistencies between this Agreement
and the Scope of Services or any other attachments attached hereto, the terms
of this Agreement shall govern.
30. INTERPRETATION
The terms of this Agreement shall be construed in accordance with the meaning
of the language used and shall not be construed for or against either party by
reason of the authorship of the Agreement or any other rule of construction which
might otherwise apply.
31. AMENDMENTS
This Agreement may be modified or amended only by a written document
executed by both Consultant and City and approved as to form by the City
Attorney.
32. SEVERABILITY
If any term or portion of this Agreement is held to be invalid, illegal, or otherwise
unenforceable by a court of competent jurisdiction, the remaining provisions of
this Agreement shall continue in full force and effect.
33. CONTROLLING LAW AND VENUE
The laws of the State of California shall govern this Agreement and all matters
relating to it and any action brought relating to this Agreement shall be
adjudicated in a court of competent jurisdiction in the County of Orange.
34. EQUAL OPPORTUNITY EMPLOYMENT
Consultant represents that it is an equal opportunity employer and it shall not
discriminate against any subcontractor, employee or applicant for employment
because of race, religion, color, national origin, handicap, ancestry, sex or age.
11 � 3
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed on
the day and year first written above.
APPROVED AS TO FORM:
OFFICE OF THE CITY ATTORNEY
8,211AMA 11 Iw
Leonie Mulvihill,
Assistant City Attorney
City of Newport Beach
ATTEST:
31
Leilani Brown, City Clerk
City of Newport Beach
CITY OF NEWPORT BEACH,
A Municipal Corporation
By:
Keith D. Curry, Mayor
City of Newport Beach
CONSULTANT:
By:
(Corporate Officer)
Title:
Print Name:
By:
(Financial Officer)
Title:
Print Name:
Attachments: Exhibit A — Scope of Services
Exhibit B — Properties List
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EXHIBIT A
SCOPE OF SERVICES
A. General Services.
The Consultant shall perform all the duties and services specifically set forth herein and
shall provide such other services as City and Consultant mutually deem necessary or
advisable, or are reasonable and necessary to accomplish the intent of this Agreement
in a manner consistent with the Code of Professional Ethics and the Standards of
Professional Appraisal Practice of the Appraisal Institute and the Uniform Standards of
Professional Appraisal Practice (USPAP) of the Appraisal Foundation prevailing at the
time such services are rendered to the City.
The City may, with the concurrence of Consultant, expand this Agreement to include
any additional services not specifically identified within the terms of this Agreement.
Any additional services may be described in an addendum to this Exhibit A and are
subject to fees described in Section 4 of this Agreement.
B. Appraisal and Valuation Services.
The Consultant shall assume primary responsibility for assisting the City in coordinating
the planning and execution of an appraisal strategy seeking to identify a group of assets
which have an aggregate fair market value of at least $130 million and an aggregate
annual fair rental value of at least $9 million relating to the Project. Insofar as the
Consultant is providing Services which are rendered only to the City, the overall
appraisal strategy shall be such as to maximize the reasonably estimated values of its
assets, yet minimize the costs and time involved in reaching the targeted aggregate
amounts identified above. The Consultant's proposed appraisal and valuation strategy
Services may include, but shall not be limited to, the following:
• Develop the appraisal strategy to obtain required results;
• Provide appraisal summary reports for selected City -Owned assets.
• Develop the appraisal Schedule so long as the group of asset's
values are reasonably determined by late August, 2010.
The appraisal techniques underlying an opinion of value from the Consultant include the
sales comparison, cost and income capitalization approaches. Depending upon the
individual property and defined value, one or more of approaches may be applicable.
The initial phase of the assignment includes individual property inspections and a data
search of recent sale and lease transactions within the competitive market area
encompassing commercial, industrial, residential and institutional uses for both land and
improved properties.
Specifically, Consultant will perform the following services to address the variety of
improvements and uses to be appraised:
13 6S
■ Individual Property Inspections — Asset List of 18 Properties
• Improvement Characteristics
• Land Characteristics
• Locational Characteristics
■ Data Search — Recent Transactions within Competitive Market Area
• Land Sale Transactions
• Commercial
• Industrial
• Residential
• Institutional
• Improved Property Sale Transactions
• Commercial
• Industrial
• Residential
• Institutional
• Improved Property Lease Transactions
• Commercial
• Industrial
• Residential
• Institutional
Following the property inspection and data collection phase, Consultant will provide
preliminary range of value indications for the following valuation alternatives.
1. Fair Market Value — Land:
Land value would reflect the individual characteristics of the property, assuming
the site to be a vacant land parcel. Fair market value, or market value, is briefly
defined as the price the site would bring if offered on the open market. For
special use and /or public facilities, the valuation would consider an alternative
highest and best use for the site, reflecting the feasibility of zone and /or general
plan land use change including the time, cost and risk of achieving the alternative
use potential.
1 a. Value in Use — Land:
For special purpose public facilities, land value could be measured by a) market
value, as described above, or b) the cost to acquire an equivalent site to support
the special purpose use (also known as the "across the fence" value). Across the
fence land value assumes the appraised site to have the use characteristics of
the adjacent privately owned land, disregarding the actual public use, zoning
and /or general plan restrictions.
2. Fair Market Value — Improvements:
Improvement value would reflect the individual characteristics of the property,
including size, age, condition and functional utility. Fair market value, or market
value, is briefly defined as the price the property would bring if offered on the
14 6�
open market. For special use and /or public facilities, the valuation would consider
an alternative highest and best use for the improved property, reflecting the costs
of use conversion and the feasibility of zone and /or general plan land use change
including the time, cost and risk of achieving the alternative use of the
improvements.
2a. Value in Use — Improvements:
Special purpose public facilities including community centers, fire stations,
libraries, and other public facilities, typically have limited conversion potential and
a limited or non - existent market. The "value in use" methodology would
incorporate the Cost Approach or improvement replacement cost plus land value.
The replacement cost would reflect the individual characteristics of the
improvements, including size, age, condition and functional utility for the
continuation of the public use.
3. Annual Fair Market Rental Value:
Fair market rental value would reflect the individual characteristics of the
property, including size, age, condition and functional utility. Fair market rental
value, or market rental value, is briefly defined as the rent the property would
bring if offered on the open market reflecting the terms and conditions of the
lease. Assumptions regarding the terms and conditions of the lease (including
obligations of taxes, insurance, maintenance and repair, etc.) are required prior
to estimating rental value. The lease terms and conditions may vary depending
upon the individual property characteristics. The estimate of annual fair market
rental value is the most complex, and likely the most subjective, of the requested
appraisal services.
3a. Annualized Property Value:
For privately held commercial and industrial properties, net rental values are
typically related to an annualized return on property value. The property return
rates are generally competitive with other investment alternatives including long
term bond yields and mortgage interest rates. As an alternative to the annual fair
market rental value may be derived by multiplying the value of the City -Owned
Asset by a competitive rate of return. The resulting "annualized property value"
is roughly equivalent to net annual rent.
C. Purpose of Appraisal.
1. Initially develop preliminary range of value estimates (see following value
definition) for eighteen city -owned properties. These preliminary value estimates
will then be used to determine which properties are to be included in the final
appraisal.
2. Prepare a final appraisal in summary format containing brief descriptions, value
conclusions, and supporting market data and analysis for the selected properties.
15 (o%
3. Estimate an annualized rate of return applicable to the aggregate value of the
selected assets that takes into account market rates of return currently being
achieved from various categories of leased real property as well as annual yields
on competitive investment opportunities such as bonds and mortgages.
D. Definition of Value and Appraisal Methodology.
It is agreed that the value to be estimated for purposes of this assignment is "use value"
and not "market value ". Use value is defined by The Appraisal of Real Estate, 13th
Edition, as "the value a specific property has for a specific use ".
Use value, or value in use, is most often employed for special purpose properties such
as churches, schools, public buildings, or specialized factories which typically have little
conversion potential and a limited or non - existent competitive market. In estimating use
value, the appraiser focuses on the value the real property contributes to the enterprise
of which it is a part, without regard to the property's highest and best use or the
monetary amount that might be realized from its sale in the open market.
The appraisal methodology commonly employed to develop use value estimates is most
akin to the cost approach as used in conventional market value appraisals. Depending
upon the circumstances, estimates of use value may be higher or lower than market
value estimates for the same property. In the case of the city properties, we would
expect that the application of the use value concept will result in higher values in most
instances for the following reasons:
1. For use value estimates, land value is typically measured by the cost to acquire
an equivalent site to support the special purpose use (also known as the "across
the fence" value). Across the fence land value assumes the appraised site to
have the use characteristics of the adjacent privately owned land, disregarding
the actual public use, zoning and /or general plan restrictions. Whereas a third
party buyer in the open market would likely discount the property value for the
limitations imposed by the existing land use controls and /or for the time, costs,
and risks associated with obtaining a different land use, no such discount is
applied when estimating value in use.
2. The contributory value of the improvements for value in use appraisals is typically
measured by the improvement replacement cost method. The replacement cost
estimate reflects the individual characteristics of the improvements, including
size, age, condition and functional utility for the continuation of the public use. A
deduction for accrued depreciation is made based upon age and observed
condition. However, no deduction is made for design and functional
characteristics unique to the specialized public use or for conversion costs
necessary to adapt the structure to a private market use.
E. Scope of Work.
It is anticipated that the following primary steps will be undertaken during the course of
this appraisal assignment:
1. Inspect each property and assemble relevant property information including:
16 69
• Land size (net usable)
• Zoning and General Plan designations and any other pertinent land use
controls for both the appraised city properties and adjoining properties
• Site and building floor plans, if available
• Improvement size, age, construction type, design features, electrical &
mechanical equipment, and condition
• Construction cost data for newer buildings, if available
• Insurance descriptions and replacement cost estimates, if available
2. Assemble and process residential, commercial /retail, office, industrial and
institutional land sales for purposes of the land value estimates. To the extent
possible, the search for comparable land sales will be confined to the central
coastal region of Orange County.
3. Assemble and process lease and sale transactions involving various categories
of investment real property as well as rate of return data from other investment
options for purposes of estimating an annualized rate of return applicable to the
aggregate appraised value of the selected properties.
4. Prepare and report a preliminary range of value estimate for each property and a
preliminary estimate of the appropriate annualized rate of return. It is anticipated
that the preliminary conclusions will be reported in a spreadsheet or summary
table format.
5. Prepare a consolidated summary appraisal report containing the final value
estimate for each selected property together with the concluded annual rate of
return. The final report will contain property descriptions together with market
data and analyses supporting the final value and rate of return estimates.
17 �9
EXHIBIT B
PROPERTIES TO BE APPRAISED
*Includes 1972, 1976, 1984 additions. Fire Station completed 1962.
* *Balboa Library completed in 1950
18 -70
Year
Sq. Ft.
Sq. Ft.
Property /Facility
Street Address
Constructed
Land
Structure
1
Newport Coast Community Center
6401 San Joaquin Hills Road
2007
133,548
16,865
2
Mariner's Library
1300 Irvine Avenue
2006
66,307
15,305
3
Fire Station 7
20401 Acacia Avenue
2007
91,912
11,027
4
Fire Station 8
6502 Ridge Park Road
1995
47,350
6,975
Central Library
1000 Avocado Ave
1997
174,648
43,957
6
P
City Hall Complex &. Fire Station 2
3300 Newport Blvd. & 475 32nd St.
1948
243,936
61,086
75
Oasis Senior Center
800 Marguerite Avenue
2010
172,546
36,500
8
Corporate Yard
592 Superior Avenue
1984
435,600
67,920
9
Fire Station 1 incl. Balboa Library
100 & 110 East Balboa Boulevard
1962 **
23,375
11,286
10
Fire Station 3
868 Santa Barbara Drive
1971
65,340
13,605
11
Fire Station 4
124 Marine Avenue
1994
4,500
1,230
12
Fire Station 5
410 Marigold Avenue
1950
6,903
2,095
13
Fire Station 6
1348 Irvine Avenue
1957
21,780
2,965
14
Police Station
870 Santa Barbara Drive
1973
82,764
47,964
15
Community Youth Center
3000 5th Avenue
1988
30,492
5,146
16
West Newport Community Center
883 15th Street
1988
41,421
6,800
17
Carroll Beek Community Center
115 Agate Avenue
1980
11,650
1,533
18
Corona del Mar Library 1420
Marigold Avenue
1958 1
13,612
4,323
*Includes 1972, 1976, 1984 additions. Fire Station completed 1962.
* *Balboa Library completed in 1950
18 -70
City of Newport Beach
BUDGET AMENDMENT
2010 -11
EFFECT ON BUDGETARY FUND BALANCE:
Increase Revenue Estimates
X Increase Expenditure Appropriations AND
Transfer Budget Appropriations
SOURCE:
from existing budget appropriations
from additional estimated revenues
PX from future bond proceeds
EXPLANATION:
This budget amendment is requested to provide for the following:
NO. BA- 11BA -001
AMOUNT: $alo,000.00
Increase in Budgetary Fund Balance
X Decrease in Budgetary Fund Balance
No effect on Budgetary Fund Balance
To increase expenditure appropriations in the Civic Center Fund to cover the initial costs associated with the financing
of the proposed Civic Center project.
ACCOUNTING ENTRY:
BUDGETARY FUND BALANCE
Fund Account Description
410 3605 Civic Center Fund - Fund Balance
REVENUE ESTIMATES (3601)
Fund /Division Account
EXPENDITURE APPROPRIATIONS (3603)
Division
Number
Account
Number
Division
Number
Account
Number
Division
Number
Account
Number
Division
Number
Account
Number
Description
Description
7410 City Hall Construction
C1002027 Civic Center Bond Issuance Cost
Signed: , tit W 0-
Signed:
Financial Appt*al: Administrative Services Director
Administrative Approval: Citl►Manager
Amount
Debit Credit
$410,000.00 *
' Automatic
$410,000.00
a6- 16
Date
7L74� to
Date
Signed:
City Council Approval: City Clerk Date