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HomeMy WebLinkAbout011411 - Agenda Packet 011411 ContractsNOTICE OF A SPECIAL MEETING ATASCADERO CITY COUNCIL Friday, January 14, 2011 5:45 p.m. City of Atascadero City Hall 6907 El Camino Real, Conference Room #4 Atascadero, California CONTRACTING SERVICES WITH THE COMMUNITY REDEVELOMENT AGENCY OF ATASCADERO ROLL CALL: 1. Historic City Hall Contract and Loan Agreement  Recommendations: Council: 1. Adopt the Draft Resolution confirming the allocation of funds for completion of the City of Atascadero’s Historic City Hall Project; and, 2. Authorize the City Manager to execute a Financing Contract with the Community Redevelopment Agency of Atascadero for the Historic City Hall Project; and, 3. Authorize the City Manager to execute a Loan Agreement with the Community Redevelopment Agency of Atascadero for the Historic City Hall Project.  Fiscal Impact: No net fiscal impact. Receipt of $13,000,000 and $10,000,000 in loan funds from the Community Redevelopment Agency of Atascadero. Expenditure of $13,000,000 on the Historic City Hall Project. [City Manager] 2. Blight Elimination Projects Contract  Recommendations: Council: 1. Adopt the Draft Resolution confirming the allocation of funds for completion of the Agency Identif ied Blight Elimination Projects; and, 2. Amend the budget by increasing Transfer from Redevelopment Age ncy Revenues by $180,000 and appropriating $180,000 of these revenues for the Zoo Wall Improvement Project; and, 3. Authorize the City Manager to execute a Change Order with the Community Redevelopment Agency of Atascadero for the Financing Agreement dated December 9, 2009 for the Zoo Wall Improvement Project in the amount of $180,000; and, 4. Authorize the City Manager to execute a Financing Contract with the Community Redevelopment Agency of Atascadero for Agency Identified Blight Elimination Projects.  Fiscal Impact: No net fiscal impact. Receipt of $8,176,820 from the Community Redevelopment Agency of Atascadero. Expenditure of $8,176,820 on Blight Elimination Projects. [City Manager] 3. Affordable Housing Contract  Recommendation: Council authorize the City Manager to execute a Financing Contract with the Community Redevelopment Agency of Atascadero for the production of 24 affordable housing units.  Fiscal Impact: No net fiscal impact. Receipt of $5,383,800 from the Community Redevelopment Agency of Atascadero; Expenditure of $5,383,800 on Affordable Housing. [City Manager] 4. Contract Services for Blight Reduction and Economic Growth  Recommendation: Council authorize the City Manager to execute a Financing Contract with the Community Redevelopment Agency of Atascadero for contract services for blight reduction and economic growth.  Fiscal Impact: No net fiscal impact. Receipt of $5,621,180 from the Community Redevelopment Agency of Atascadero; Expenditure of $5,621,180 on Blight Reduction and Economic Growth. [City Manager] ADJOURNMENT: The City Council will adjourn to the next Regular Session scheduled on Tuesday, January 25, 2011, at 6:00 p.m. STATE OF CALIFORNIA ) COUNTY OF SAN LUIS OBISPO ) CITY OF ATASCADERO ) MARCIA MCCLURE TORGERSON, C.M.C., being fully sworn, deposes, and says: That she is the duly elected City Clerk of the City of Atascadero and that on Thursday, January 13, 2011, she caused the above Notice to be posted on the doors of the City's Administration Building, 6907 El Camino Real in Atascadero, California. MARCIA MCCLURE TORGERSON, C.M.C. City Clerk City of Atascadero ITEM NUMBER: #3 DATE: 01/14/11 Atascadero City Council Staff Report – Administrative Services Production of 24 Affordable Housing Units Contract RECOMMENDATION: Council authorize the City Manager to execute a Financing Contract with the Community Redevelopment Agency of Atascadero for the production of 24 affordable housing units. DISCUSSION: One of the fundamental purposes of redevelopment is to increase and improve the community’s supply of low and moderate income housing. In addition to being a purpose that is dictated by the State Health and Safety Code, the Agency Board has indicated, through past actions, that affordable housing is a priority. Since the Board’s adoption of the Housing Production Plan, 183 market rate residential dwelling units have been constructed within the Redevelopment Agency Project Area, which requires that 28 low to moderate income units be provided (11 very low income units and 17 low / moderate income units). The Agency has thus far sponsored the production of four (4) very low income units within the Project Area, which leaves a remaining obligation to produce twenty-four (24) additional affordable housing units. Among the Board’s past actions is the adoption of an Affordable Housing Funds Policy, which allows the City to facilitate in the financial participation of affordable housing projects. The City currently employs a staff of professionals with a full range of skills and experience to manage the development of affordable housing projects. The expertise of City staff is currently used by the Agency, as these individuals have contacts in the community and can best ensure that the appropriate developers are selec ted to build the required affordable housing units. Affordable housing projects require land use entitlements, engineering, architecture, construction, financing, and legal agreements. The City currently employs planners, civil engineers, architectural plan checkers, building inspectors, finance experts, and attorneys that have the experience and capability to implement any type and size of affordable housing project. Due to this level and range of experience and expertise, City staff is able to best leverage the affordable housing funds, making the City a proper entity to assist the Agency in providing affordable housing. In order to protect funding for the production of the remaining 24 affordable housing units, the City and Agency need to formalize and document the Agency’s commitment to complete the project. Staff is recommending that the Board take the following two actions: (1) Authorize the City Manager to execute a Financing Contract with the Redevelopment Agency in order to receive funding for the completion of the project. This Contract commits the Agency to pay a total of $5,543,800 for the production of the remaining 24 affordable housing units . This commitment is part of a legally binding financing agreement with the City and on ce pledged, cannot be reversed. The City will only receive reimbursement for actual amounts spent. Execution of this agreement commits the City to the production of the remaining 24 affordable housing units and being reimbursed by the Agency (up to $5,543,800) for the Project. The City will not receive any additional administrative funds from the Agency. FISCAL IMPACT: No net fiscal impact. Receipt of $5,383,800 from the Community Redevelopment Agency of Atascadero; Expenditure of $5,383,800 on Affordable Housing. ATTACHMENTS: 1. Draft Financing Contract - Production of 24 Affordable Housing Units FINANCING CONTRACT PRODUCTION OF 24 AFFORDABLE HOUSING UNITS THIS FINANCING CONTRACT (“Contract”) is made and entered into this 14th day of January, 2011 by and between the CITY OF ATASCADERO, a general law city and municipal corporation (“City”) and the COMMUNITY REDEVELOPMENT AGENCY OF ATASCADERO, a public body, corporate and politic (“Agency”). Hereinafter, City and Agency shall be referred to collectively as the “Parties” and singularly as the “Party.” R E C I T A L S WHEREAS, the City Council previously adopted a Redevelopment Plan (the “Redevelopment Plan”) for a redevelopment project area (the “Project Area”); and, WHEREAS, the Agency is vested with responsibility pursuant to the Community Redevelopment Law (Part 1 of Division 24 of Health and Safety Code of the State of California) (the “Law”) to implement the Redevelopment Plan both within and without the Project Area; and, WHEREAS, Sections 33000 et. seq. of the Law states that one of the fundamental purposes of redevelopment is to increase and improve the community’s supply of low and moderate income housing; and, WHEREAS, the Law requires that 20% of the tax increment revenues received by the Agency be placed in a Low and Moderate Income Housing Fund (“LMIHF”). The LMIHF funds are to be used to increase, improve and preserve the supply of low and moderate income housing in the Project Area and within City limits (H&S 33334.2); and, WHEREAS, The Agency must replace low and moderate income housing that is removed as a result of a redevelopment project (the replacement rule, H&S 33413(a)); and, WHEREAS, 15% of all housing constructed in a redevelopment project area must be affordable to low and moderate-income persons and families (the inclusionary rule, H&S 33413(b)); and, WHEREAS, the Law requires that each redevelopment agency shall adopt a Housing Production Plan, in conjunction with its Implementation Plan, which is consistent with the governing General Plan Housing Element. In addition, Sections 33413.5 and 33334.5 require replacement housing plans for any units that will be demolished within the Project Area; and, WHEREAS, since the Housing Production Plan’s adoption, 183 market rate residential dwelling units have been constructed within the Redevelopment Agency Project Area, which requires that 28 low to moderate income units be provided (11 very low income units and 17 low / moderate income units); and, WHEREAS, the Agency has sponsored the production of four (4) very lo w income units within the Project Area, which leaves a remaining obligation to produce twenty-four (24) additional affordable housing units (the “Project”); and, 2 WHEREAS, the Project conforms to the General Plan of the City; and, WHEREAS, the Agency is authorized by the California Redevelopment Law to enter into a binding contract with the City pursuant to which the Agency will irrevocably commit the LMIHF funds to the Project and due to the Agency’s previous commitment to the Project the Agency intends to provide funding in the amount of $5,543,800.00 (“the LMIHF Funds”) to assist the City with the cost of the Project because the Project will directly benefit the Project Area; and, WHEREAS, the City provides a full staff of planning, construction and finance professionals, who are experienced in the planning, financing and construction of affordable housing projects; and, WHEREAS, pursuant to Section 33334.3 of the Law, the Agency may use LMIHF funds to pay for services provided through interagency agreements, including usual indirect costs related thereto, for the purpose of producing affordable housing units; and, WHEREAS, a duly noticed public meeting of the Agency was held on January 14, 2011 wherein the Agency adopted Resolution No. ________ making all required findings for the use of the LMIHF Funds for the Project pursuant to Section 33445. NOW, THEREFORE, the Parties hereto state and agree as follows: 1. The purpose of this Contract is to set forth the understanding and agreement of the Parties with respect to the Agency’s commitment to fund the Project through reimbursement of the City’s share of Project costs, up to a defined amount. The contents of this Contract are intended to be as comprehensive as possible with respect to the Agency’s commitment of LMIHF Funds (as defined in paragraph 3 of this contract) to the Project yet not exhaustive with respect to additional issues and expenses that may arise relative to the development of the Project. In the event that issues and expenses occur that are not identified in this Contract, the Parties agree to work together in good faith to resolve each matter. 2. The Agency anticipates that the Project will address the goals and objectives of the Redevelopment Plan for the Project Area and will be of benefit to the Project Area by increase, improving and preserving the supply of low and moderate income housing in the Project Area and within City limits. The Agency has agreed to commit a total sum of five million five hundred forty-three thousand eight hundred dollars and no cents ($5,543,800.00) (“LMIHF Funds”) to the Project to pay for the Project’s direct benefit to the Project Area. 3. Within thirty (30) business days of the Parties executing this Contract, Agency shall segregate the sum of five million five hundred forty-three thousand eight hundred dollars and no cents ($5,543,800.00) within the Agency’s accounts to be held in a separate account (“LMIHF Account”) to pay the Project costs. The Agency Funds shall be held in the LMIHF Account until 2 months from the latest of the date the project is completed or the date of the final invoice. The City shall request reimbursement from the Agency for Project costs actually incurred and the Agency shall reimburse the City from the LMIHF Funds from the LM IHF Account. 3 4. In contemplation of the provisions of Section 895.2 of the California Government Code imposing certain tort liability jointly upon public entities solely by reason of such entities being Parties to an agreement as defined in Section 895 of said code, the Parties hereto, as between themselves pursuant to the authorization contained in Sections 895.2 and 895.6 of said code, will each assume the full liability imposed upon it or any of its officers, agents or employees by law for personal injury, property damage or loss to third Parties caused by a negligent or wrongful act or omission of that party occurring in the performance of the Contract. To achieve the above stated purpose, each party indemnifies and holds harmless the other party for any damage, loss, cost or expense arising out of its own negligent or wrongful acts or omissions. 5. These obligations, as set forth herein, are binding on the successors, assigns or heirs, including any private or public entities, of both parties. 6. This Contract shall be governed by the laws of California and represents the entire agreement of the Parties as to the subject matter of this Contract. IN WITNESS WHEREOF, the City and Agency have approved the foregoing FINANCING CONTRACT effective January 14, 2011, and caused the same to be executed by their duly authorized officers as set forth below. AGENCY CITY By:_________________________________ By:________________________________ Wade G. McKinney Wade G. McKinney Executive Director City Manager ATTEST: ATTEST: By:_________________________________ By:________________________________ Marcia McClure Torgerson, C.M.C. Marcia McClure Torgerson, C.M.C. Board Secretary City Clerk Date:________________________________ Date:_________________________________ APPROVED AS TO FORM APPROVED AS TO FORM Community Redevelopment Agency City of Atascadero of Atascadero By:__________________________________ By:________________________________ Brian A. Pierik, Agency General Counsel Brian A. Pierik, City Attorney FINANCING CONTRACT ATASCADERO CAPITAL PROJECTS THIS FINANCING CONTRACT (“Contract”) is made into and effective this 14th day of January, 2011 by and between the CITY OF ATASCADERO, a general law city and municipal corporation (“City”) and the COMMUNITY REDEVELOPMENT AGENCY OF ATASCADERO, a public body, corporate and politic (“Agency”). Hereinafter, City and Agency shall be referred to collectively as the “Parties” and singularly as the “Party.” R E C I T A L S WHEREAS, the City Council previously adopted a Redevelopment Plan (the “Redevelopment Plan”) for a redevelopment project area (the “Project Area”); and, WHEREAS, the Agency is vested with responsibility pursuant to the Community Redevelopment Law (Part 1 of Division 24 of Health and Safety Code of the State of California) (the “Law”) to implement the Redevelopment Plan both within and without the Project Area; and, WHEREAS, the governing Board of the Agency has identified a list of priority blight elimination projects within the City (Project List) for the Agency; and, WHEREAS, the Agency has commenced or will soon commence construction on each of the projects of the Project List; and, WHEREAS, the Project List consists of the following Projects, hereinafter known collectively as “Projects”: Wayfinding Signage Downtown Pedestrian Bridge Downtown Parking Downtown Restrooms Commercial Property Purchase Archway Sign Creek Trail Extension Creek Improvements Maiden Statue Restoration Downtown Streetscape Downtown Lighting Projects Lewis Ave Bridge; and WHEREAS, the Wayfinding Signage Project listed in the Project List provides for plans and construction of the Wayfinding Program including downtown pedestrian signs, one entrance (to the City) sign, and one monument sign to enhance pedestrian and motor traffic navigation in the downtown area and is included in the Redevelopment Project Area; and, 2 WHEREAS, the Wayfinding Signage Project listed in the Project List has been a priority for the Agency governing Board and has been funded in two of the three previous two-year budget cycles; and, WHEREAS, the Wayfinding Signage Project listed in the Project List was ranked by the Agency governing Board in June, 2010, as the number one priority of all outstanding projects; and, WHEREAS, the Downtown Pedestrian Bridge Project listed in the Project List provides for the design and construction of a pedestrian bridge across Atascadero Creek from Colony Square to the Sunken Gardens to enhance pedestrian and reduce motor traffic in the downtown area and is included in the Redevelopment Project Area; and, WHEREAS, the Downtown Pedestrian Bridge Project listed in the Project List has been a priority for the Agency governing Board and has been funded in a previous two -year budget cycle; and, WHEREAS, the Downtown Pedestrian Bridge Project listed in the Project List was ranked by the Agency governing Board in June, 2010, as the number two priority of all outstanding projects; and, WHEREAS, the Downtown Pedestrian Bridge Project listed in the Project List has construction documents that are approximately 90% complete; and, WHEREAS, the Downtown Parking Project listed in the Project List provides for the design and construction of parking improvements identified in the Downtown Parking Study of 2006 and whose purpose is to enhance business and tourism and eliminate blight in the downtown area which is included in the Redevelopment Project Area; and, WHEREAS, the Downtown Parking Project listed in the Project List has been a priority for the Agency governing Board and has been funded in three previous two-year budget cycles; and, WHEREAS, the Downtown Parking Project listed in the Project List was ranked by the Agency governing Board in June, 2010, as the number three priority of all outstanding projects; and, WHEREAS, the Downtown Restroom Project listed in the Project List provides for the design and construction of public restroom facilities in the Downtown area to enhance business and tourism, improve sanitation and eliminate blight in the downtown area which is included in the Redevelopment Project Area; and, WHEREAS, the Downtown Restroom Project listed in the Project List was ranked by the Agency governing Board in June, 2010, as the number four priority of all outstanding projects; and, 3 WHEREAS, the Commercial Property Purchase Project listed in the Project List provide s for the purchase of property in the Redevelopment Area to encourage investment and development and to eliminate blight in the Redevelopment Project Area; and, WHEREAS, the Commercial Property Purchase Project listed in the Project List has been a priority for the Agency governing Board and has been funded in two of the three previous two- year budget cycles; and, WHEREAS, the Commercial Property Purchase Project listed in the Project List was ranked by the Agency governing Board in June, 2010, as the number five priority of all outstanding projects; and, WHEREAS, the Archway Sign Project listed in the Project List provides for the construction of an archway sign as part of the larger Downtown design. The Sign has been fully designed and replicates an historic sign that previously existed Downtown and whose purpose is to enhance business and tourism and eliminate blight in the downtown area which is included in the Redevelopment Project Area; and, WHEREAS, the Archway Sign Project listed in the Project List has been a priority for the Agency governing Board and has been funded in two of the three previous two-year budget cycles; and, WHEREAS, the Archway Sign Project listed in the Project List was ranked by the Agency governing Board in June, 2010, as the number seven priority of all outstanding projects; and, WHEREAS, the Creek Trail Extension Project listed in the Project List provides for the design and construction of an extension of the Atascadero Creek trail from the Downtown area to the City’s new Colony Park Community Center to enhance pedestrian traffic between the two endpoints while promoting a pedestrian-friendly green community and the elimination of blight in the downtown area which is included in the Redevelopment Project Area; and, WHEREAS, the Creek Trail Extension Project listed in the Project List was ranked by the Agency governing Board in June, 2010, as the number eight priority of all outstanding projects; and, WHEREAS, the Creek Improvements Project listed in the Project List provides for creek clean up, bank stabilization, and aesthetics to enhance the downtown area and is included in the Redevelopment Project Area; and, WHEREAS, the Creek Improvements Project listed in the Project List has been a priority for the Agency governing Board and has been funded in the three previous two-year budget cycles; and, WHEREAS, the Maiden Statue Restoration Project listed in the Project List provides for the restoration, relocation, and re-installation of the historic Maiden Statue. This Statue is also known as the Wrestling Bacchantes and was created by the Italian artist Petrilla and exhibited at the 1904 World’s Fair by the Italian Government. Atascadero’s Founder, E.G. Lewis, purchased 4 it for display in the Civic Center. It was located in the City’s downtown and included in the Redevelopment Project Area at the time that it was transported to Cambria, California for restoration; and, WHEREAS, the Maiden Statue Restoration Project listed in the Project List has been a priority for the Agency governing Board and has been funded in the three previous two-year budget cycles; and, WHEREAS, the Downtown Streetscape Project listed in the Project List provides for the design and construction of decorative sidewalk and bridge railings, decorative lighting, and street paving within the downtown core to enhance safety, improve transportation and eliminate blight which is a priority goal included in the Redevelopment Area goals; and, WHEREAS, the Downtown Streetscape Project listed in the Project Lis t is the third and last phase to complete the project; and, WHEREAS, the Downtown Streetscape Project listed in the Project List has been a priority for the Agency governing Board and the various phases have been funded in the five previous two-year budget cycles; and, WHEREAS, the Downtown Streetscape Project listed in the Project List is fully designed and has gone out to bid, bids were rejected by the City Council and will go out to bid a second time; and, WHEREAS, the Downtown Streetscape Project listed in the Project List received appropriated grant funding from the Federal American Recovery and Reinvestment Act in the amount of $685,000; and, WHEREAS, the Downtown Lighting Project listed in the Project List provides for the design and construction of decorative lighting and power outlet improvements throughout the downtown area to enhance tourism, improve safety and eliminate blight fronting properties throughout the downtown core which is a priority goal included in the Redevelopment Area goals; and, WHEREAS, the Downtown Lighting Project listed in the Project List has been a priority for the Agency governing Board and has been funded in the three previous two-year budget cycles; and, WHEREAS, the Agency has expended over $75,000 over the last 5 years on the Downtown Lighting Project listed in the Project List; and, WHEREAS, the Lewis Avenue Bridge Project listed in the Project List provides for the required contractual Atascadero Creek maintenance and vegetation control necessary as a result of the recent construction of the Lewis Avenue Bridge over the Atascadero Creek within in the Redevelopment Area to enhance pedestrian and motor traffic in and around the Downtown Area and to eliminate blight in the Redevelopment Project Area; and, 5 WHEREAS, the Agency contributed significant funding for the construction of the Lewis Avenue Bridge Project and the required creek maintenance is a condition of that Project; and, WHEREAS, the Lewis Avenue Bridge Project listed in the Project List has been a priority for the Agency governing Board and has been funded in the three previous two-year budget cycles; and, WHEREAS, the facilities in the Project List upon their completion will be owned and operated by the City; and, WHEREAS, the City lacks sufficient capital or general funds available which could be used to fully fund the Projects and bring them to completion and it is not practical to arrange for assessment district, City-paid bond issue, or similar financing for the Projects; and, WHEREAS, the Projects will address the goals and objectives of the Redevelopment Plan for the Project Area and will be of benefit to the Project Area in that the Project s will attract additional tourists, assist with improving physical aesthetics, deter crime, stimulate additional desired activity in the Project Area, and alleviate blighting conditions in the Project Area; and, WHEREAS, the Projects are consistent with and will promote the Agency’s Implementation Plan; and, WHEREAS, the Agency intends to provide funding (“the Agency Funds”) to assist the City with the cost of the Projects because the Projects will directly benefit the Project Area; and, WHEREAS, the estimated cost of the individual Projects on the Project List are as follows: Wayfinding Signage 168,000$ Downtown Pedestrian Bridge 1,680,000 Downtown Parking 840,000 Downtown Restrooms 672,000 Commercial Property Purchase 2,050,000 Archway Sign 720,000 Creek Trail Extension 1,512,000 Creek Improvements 150,000 Maiden Statue Restoration 51,590 Downtown Streetscape 252,820 Downtown Lighting Projects 72,200 Lewis Ave Bridge 8,210 Total Projects' Cost 8,176,820$ ; and WHEREAS, pursuant to Health and Safety Code Section 33445, the Agency may, with the consent of the City Council, pay part or all of the cost of the construction of the Project if the Board and the City make certain specified findings; and, WHEREAS, a duly noticed Agency meeting was held on January 14, 2011 wherein the Agency adopted Resolution No. RA 2011-003 making all required findings for the use of Agency funds for the Projects pursuant to Section 33445. 6 NOW, THEREFORE, the Parties hereto state and agree as follows: 1. The purpose of this Contract is to set forth the understanding and contract of the Parties with respect to the Agency’s commitment to fund the Projects. The contents of this Contract are intended to be as comprehensive as possible with respect to the Agency’s commitment of funds to the Projects yet not exhaustive with respect to additional issues that may arise relative to the development of the Projects. In the event that issues occur that are not identified in this Contract, the Parties agree to work together in good faith to resolve each matter. 2. The Parties understand that the City will be required to complete final planning and public bidding required on the Projects. Those final plans and the public bidding are prerequisites for the City’s construction of the Projects, including the improvements that will be of benefit to the Project Area. 3. The estimated total cost of the Projects is $8,176,820 (“Total Cost”). The Agency anticipates that the Projects will address the goals and objectives of the Redevelopment Plan for the Project Area and will be of benefit to the Project Area in that the Projects will attract additional tourists, assist with improving physical aesthetics, deter crime, stimulate additional desired activity in the Project Area, and alleviate blighting conditions in the Project Area. The Agency has agreed to commit a total sum of eight million one hundred seventy-six thousand eight hundred twenty dollars ($8,176,820.00) (“Agency Funds”) to the Projects to pay for the direct benefit to the Project Area. The parties understand and agree that while the estimated total cost of the Projects is $8,176,820, the actual cost for each individual component of the Projects is subject to change. The Agency’s commitment of $8,176,820 is a commitment to all of the Projects and recognizes that some components will cost less than the estimate and some will cost more. Any cost in excess of $8,176,820 must be borne by the City. 4. The Parties agree that the Agency shall use the Agency Funds to the extent that such funds have not been previously committed to pay for and/or reimburse City for costs and expenses associated in any way with the design and construction of the Projects. 5. Within thirty (30) business days of the Parties executing this Contract, Agency shall segregate the sum of eight million one hundred seventy-six thousand eight hundred twenty dollars ($8,176,820.00) within the Agency’s accounts to be held in a separate account (“Blight Elimination Projects Fund”) to pay the Agency’s share of the Projects’ costs. The Agency Funds shall be held in the Blight Elimination Project Fund until the later of two (2) months from the date the project is completed, two (2) months from the date of the final invoice, or six (6) months from the closure of any grants related to the Project. The City shall request reimbursement from the Agency for Projects’ costs actually incurred and the Agency shall reimburse the City from the Agency Funds in the Blight Elimination Project Fund. It is understood and agreed between the Parties that any funds remaining in the Blight Elimination Project Fund at the expiration of the later of two (2) months from the date the Project List is completed, two (2) months from the date of the final invoice, or six (6) months from the closure of any grants related to the Project List, shall revert to the full control and discretion of the Agency. 6. The City understands and agrees that a portion of the source of the Agency Funds may be the proceeds of tax exempt bonds secured by the tax increment revenue the Agency 7 receives pursuant to California Health and Safety Code Section 33670 (the “Bonds”). The City covenants and agrees with respect to the Projects to comply with all applicable requirements of the federal Internal Revenue Code necessary to preserve the tax -exempt status of the interest on the Bonds and specifically covenants, without limiting the generality of the foregoing, as follows: (a) Private Activity. The City will take no action or refrain from taking any action or make any use of the proceeds of the Bonds or of any other monies or property which would cause the Bonds to be “private activity bonds” within the meaning of Section 141 of the Internal Revenue Code of 1986, as amended; and (b) Arbitrage. The City will make no use of the proceeds of the Bonds or of any other amounts or property, regardless of the source, or take any action or refrain from taking any action which will cause the Bonds to be “arbitrage bonds” within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended; and (c) Federal Guaranty. The City will make no use of the proceeds of the Bonds or take or omit to take any action that would cause the Bonds to be “federally guaranteed” within the meaning of Section 149(b) of the Internal Revenue Code of 1986, as amended; and (d) Information Reporting. The City will cooperate with the Agency in providing information that the Agency needs to comply with the informational reporting requirement of Section 149(e) of the Internal Revenue Code of 1986, as amended; and (e) Hedge Bonds. The City will make no use of the proceeds of the Bonds or any other amounts or property, regardless of the source, or take any action or refrain from taking any action that would cause the Bonds to be considered “hedge bonds” within the meaning of Section 149(g) of the of the Internal Revenue Code of 1986, as amended, unless the City takes all necessary action to assure compliance with the requirements of Section 149(g) of the of the Internal Revenue Code of 1986, as amended, to maintain the tax exempt status of interest on the Bonds for federal income tax purposes and such action has been approved by the Agency. 7. In contemplation of the provisions of Section 895.2 of the California Government Code imposing certain tort liability jointly upon public entities solely by reason of such entities being Parties to an contract as defined in Section 895 of said code, the Parties hereto, as between themselves pursuant to the authorization contained in Sections 895.2 and 895.6 of said code, will each assume the full liability imposed upon it or any of its officers, agents or emplo yees by law for personal injury, property damage or loss to third Parties caused by a negligent or wrongful act or omission of that party occurring in the performance of the Contract. To achieve the above stated purpose, each party indemnifies and holds harmless the other party for any damage, loss, cost or expense arising out of its own negligent or wrongful acts or omissions. 8. This Contract shall be governed by the laws of California and represents the entire contract of the Parties as to the subject matter of this. 9. These obligations, as set forth herein, are binding on the successors, assigns or heirs, including any private or public entities, of both parties. 8 10. This Contract shall be governed by the laws of California and represents the entire agreement of the Parties as to the subject matter of this Contract. IN WITNESS WHEREOF, the City and Agency have approved the foregoing FINANCING CONTRACT effective January 14, 2011, and caused the same to be executed by their duly authorized officers as set forth below. AGENCY CITY By:_________________________________ By:________________________________ Wade G. McKinney Wade G. McKinney Executive Director City Manager ATTEST: ATTEST: By:_________________________________ By:________________________________ Marcia McClure Torgerson, C.M.C. Marcia McClure Torgerson, C.M.C. Board Secretary City Clerk Date:________________________________ Date:_________________________________ APPROVED AS TO FORM APPROVED AS TO FORM Community Redevelopment Agency City of Atascadero of Atascadero By:__________________________________ By:________________________________ Brian A. Pierik, Agency General Counsel Brian A. Pierik, City Attorney RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ATASCADERO, CALIFORNIA, CONFIRMING THE ALLOCATION OF FUNDS FOR COMPLETION OF THE AGENCY IDENTIFIED BLIGHT ELIMINATION PROJECTS WHEREAS, the City Council for the City of Atascadero (the “City”) has adopted the Redevelopment Plan for the Project Area (the “Redevelopment Plan”); and, WHEREAS, the Community Redevelopment Agency of Atascadero (the “Agency”) and the Agency Board of Directors (“Board”) is vested with responsibility pursuant to the Community Redevelopment Law (Part 1 of Division 24 of Health and Safety Code of the State of California) (the “Law”) to implement the Redevelopment Plan in the Project Area; and, WHEREAS, the governing Board of the Agency has identified a list of priority blight elimination projects within the City (“Project List”) for the Agency; and, WHEREAS, the Agency has commenced or will soon commence construction on each of the Projects of the Project List; and, WHEREAS, the Project List consists of the following Projects, hereinafter known collectively as “Projects”: Wayfinding Signage Downtown Pedestrian Bridge Downtown Parking Downtown Restrooms Commercial Property Purchase Archway Sign Creek Trail Extension Creek Improvements Maiden Statue Restoration Downtown Streetscape Downtown Lighting Projects Lewis Ave Bridge WHEREAS, the Wayfinding Signage Project listed in the Project List provides for plans and construction of the Wayfinding Program including downtown pedestrian signs, one entrance (to the City) sign, and one monument sign to enhance pedestrian and motor traffic navigation in the downtown area and is included in the Redevelopment Project Area; and, WHEREAS, the Downtown Pedestrian Bridge Project listed in the Project List provides for the design and construction of a pedestrian bridge across Atascadero Creek from Colony Square to the Sunken Gardens to enhance pedestrian and reduce motor traffic in the downtown area and is included in the Redevelopment Project Area; and, WHEREAS, the Downtown Parking Project listed in the Project List provides for the design and construction of parking improvements identified in the Downtown Parking Study of 2006 and whose purpose is to enhance business and tourism and eliminate blight in the downtown area which is included in the Redevelopment Project Area; and, WHEREAS, the Downtown Restroom Project listed in the Project List provides for the design and construction of public restroom facilities in the Downtown area to enhance business and tourism, improve sanitation and eliminate blight in the downtown area which is included in the Redevelopment Project Area; and, WHEREAS, the Commercial Property Purchase Project listed in the Project List provides for the purchase of property in the Redevelopment Area to encourage investment and development and to eliminate blight in the Redevelopment Project Area; and, WHEREAS, the Archway Sign Project listed in the Project List provides for the construction of an archway sign as part of the larger Downtown design. The Sign has been fully designed and replicates an historic sign that previously existed Downtown and whose purpose is to enhance business and tourism and eliminate blight in the downtown area which is included in the Redevelopment Project Area; and, WHEREAS, the Creek Trail Extension Project listed in the Project List provides for the design and construction of an extension of the Atascadero Creek trail from the Downtown area to the City’s new Colony Park Community Center to enhance pedestrian traffic between the two endpoints while promoting a pedestrian-friendly green community and the elimination of blight in the downtown area which is included in the Redevelopment Project Area; and, WHEREAS, the Creek Improvements Project listed in the Project List provides for creek clean up, bank stabilization, and aesthetics to enhance the downtown area and is included in the Redevelopment Project Area; and, WHEREAS, the Maiden Statue Restoration Project listed in the Project List provides for the restoration, relocation, and re-installation of the historic Maiden Statue. This Statue is also known as the Wrestling Bacchantes and was created by the Italian artist Petrilla and ex hibited at the 1904 World’s Fair by the Italian Government. Atascadero’s Founder, E.G. Lewis, purchased it for display in the Civic Center. It was located in the City’s downtown and included in the Redevelopment Project Area at the time that it was transported to Cambria, California for restoration; and, WHEREAS, the Downtown Streetscape Project listed in the Project List provides for the design and construction of decorative sidewalk and bridge railings, decorative lighting, and street paving within the downtown core to enhance safety, improve transportation and eliminate blight which is a priority goal included in the Redevelopment Area goals; and, WHEREAS, the Downtown Lighting Project listed in the Project List provides for the design and construction of decorative lighting and power outlet improvements throughout the downtown area to enhance tourism, improve safety and eliminate blight fronting properties throughout the downtown core which is a priority goal included in the Redevelopment Area goals; and, WHEREAS, the Lewis Avenue Bridge Project listed in the Project List provides for the required contractual Atascadero Creek maintenance and vegetation control necessary as a result of the recent construction of the Lewis Avenue Bridge over the Atascadero Creek within in the Redevelopment Area to enhance pedestrian and motor traffic in and around the Downtown Area and to eliminate blight in the Redevelopment Project Area; and, WHEREAS, the Agency contributed significant funding for the construction of the Lewis Avenue Bridge Project and the required creek maintenance is a condition of that Project; and, WHEREAS, the facilities in the Project List upon their completion will be owned and operated by the City; and, WHEREAS, the estimated cost of the individual Projects on the Project List are as follows: Wayfinding Signage 168,000$ Downtown Pedestrian Bridge 1,680,000 Downtown Parking 840,000 Downtown Restrooms 672,000 Commercial Property Purchase 2,050,000 Archway Sign 720,000 Creek Trail Extension 1,512,000 Creek Improvements 150,000 Maiden Statue Restoration 51,590 Downtown Streetscape 252,820 Downtown Lighting Projects 72,200 Lewis Ave Bridge 8,210 Total Projects' Cost 8,176,820$ ; and WHEREAS, the Agency intends to provide funding (“the Agency Funds”) to assist the City with the cost of the Projects because the Projects will directly benefit the Project Area; and, WHEREAS, the Projects will address the goals and objectives of the Redevelopment Plan for the Project Area and will be of benefit to the Project Area in that the Projects will attract additional tourists, assist with improving physical aesthetics, deter crime, stimulate additional desired activity in the Project Area, and alleviate blighting conditions in the Project Area; and, WHEREAS, the Projects are consistent with and will promote the Agency’s Implementation Plan; and, WHEREAS, the construction of the Projects conforms to the General Plan of the City; and, WHEREAS, pursuant to Health and Safety Code Section 33445, the Agency may, with the consent of the City, pay part or all of the cost of the P roject if the Board and the City make certain specified findings; and, WHEREAS, the Agency has made the requisite findings pursuant to section 33445 and has committed to provide the City with a Agency Funds for the Projects; and, WHEREAS, the City lacks sufficient capital or general funds available which could be used to undertake the Project and bring it to completion and it is not practical to arrange for assessment district, City-paid bond issue or any other similar financing for the Project; and, WHEREAS, the staff report to the City Council at its meeting held on January 14, 2011 (the “Staff Report,” incorporated herein by reference), which sets forth facts supporting the findings made in this Resolution pursuant to Section 33445 of the Health and Safet y Code, has been prepared to accompany this Resolution. NOW, THEREFORE BE IT RESOLVED by the City Council of the City of Atascadero: 1. That the City Council hereby finds and determines pursuant to California Health and Safety Code section 33445 that: (a) the Projects will be of benefit to the Project Area by helping to eliminate blight within the Project Area; (b) no other reasonable method of financing the gap between the total cost of the Project s and the funds available to the City is available to the community; (c) Agency assistance for the Project is consistent with the Agency’s current Implementation Plan. The factual and analytical basis used by the Agency in making these findings and determinations is set forth in the Staff Report, and records regarding the Project. 2. That the City Council consents to the Agency’s financial commitment to the Project and desires that the Project continue to move forward in a manner that will most effectively provide the foregoing benefits to the Project Area. 3. That the City Council consents to the Agency expenditure of the Agency Funds and Agency Loan set forth in the Contract, between the Agency and the City and submitted to the Agency in connection with consideration of this Resolution. 4. That the City Council directs the City Manager to execute the Contract with the Agency concerning the Agency Funds. IT IS FURTHER RESOLVED AND ORDERED that this resolution will become effective January 14, 2011 upon the approval by the City Council. On motion by Council Member ___________________ and seconded by Council Member _____________________, the foregoing resolution is hereby adopted in its entirety on the following roll call vote: AYES: NOES: ABSENT: ADOPTED: CITY OF ATASCADERO By:__________________________ Tom O’Malley, Mayor ATTEST: _______________________________ Marcia McClure Torgerson, C.M.C., City Clerk APPROVED AS TO FORM: _______________________________ Brian A. Pierik, City Attorney ITEM NUMBER: #2 DATE: 01/14/11 Atascadero City Council Staff Report – Administrative Services Blight Elimination Projects Contract RECOMMENDATIONS: Council: 1. Adopt the Draft Resolution confirming the allocation of funds for completion of the Agency Identified Blight Elimination Projects; and, 2. Amend the budget by increasing Transfer from Redevelopment Agency Revenues by $180,000 and appropriating $180,000 of these revenues for the Zoo Wall Improvement Project; and, 3. Authorize the City Manager to execute a Change Order in the amount of $180,000 with the Community Redevelopment Agency of Atascadero for the Financing Agreement dated December 9, 2009 for the Zoo Wall Improvement Project; and, 4. Authorize the City Manager to execute a Financing Contract with the Community Redevelopment Agency of Atascadero for Agency Identified Blight Elimination Projects. DISCUSSION: The Agency Board has indicated, through past actions, that there is a short list of priority blight elimination projects that the Board would like to see complete. The Agency has either appropriated funding, begun the projects, or has agreed on a priority list of projects that will be completed with current Agency resources. In totality these projects are collectively known as the Identified Blight Elimination Projects and are referred to herein after as “The Project.” The Agency began budgeting for many of these projects in the budget cycle that included fiscal years 2005-2006 and 2006-2007. In order to protect funding for the Project, the City and Agency need to formalize and document the Agency’s commitment to complete the Project. Staff is recommending that the Board take the following actions: (1) Adopt the attached draft resolution determining that the Project meets the required findings in Health and Safety Code Section 33445, reaffirming the Agency’s financial commitment to the Project, approving the expenditure of Agency funds, and approving the execution of the Financing Contract irrevocably committing a total sum of eight million one hundred seventy-six thousand eight hundred twenty dollars ($8,176,820.00) of Agency Funds to the Project. (2) Authorize the Executive Director to execute a Financing Contract with the City to provide funding for the completion of the Project. This Contract commits the Agency to pay a total sum of eight million one hundred seventy- six thousand eight hundred twenty dollars ($8,176,820.00) for the Project. This commitment is part of a legally binding financing contract with the City and once pledged, cannot be reversed. The Agency will not pay the City any additional administrative funds and any funds remaining at the end of the project will be returned to the Agency. Execution of this agreement commits the City to completing the Identified Blight Elimination Projects and being reimbursed by the Agency (up to $8,176,820.00) for the Project. The City will be reimbursed for actual costs incurred and shall not receive any additional administrative funds from the Agency. Any funds remaining at the end of the Project shall revert to the Agency. The Project While estimated dollar amounts are provided for each phase of the Project, these are for informational purposes only. The executed contract is intended to be for the totality of Project. Wayfinding Signage 168,000$ Downtown Pedestrian Bridge 1,680,000 Downtown Parking 840,000 Downtown Restrooms 672,000 Commercial Property Purchase 2,050,000 Archway Sign 720,000 Creek Trail Extension 1,512,000 Creek Improvements 150,000 Maiden Statue Restoration 51,590 Downtown Streetscape 252,820 Downtown Lighting Projects 72,200 Lewis Ave Bridge 8,210 Total Project Cost 8,176,820$ Wayfinding Signage: The W ayfinding Signage Project provides for plans and construction of the Wayfinding Program including downtown pedestrian signs, one entrance (to the City) sign, and one monument sign . The Signage will enhance pedestrian and motor traffic navigation in the downtown area will help the traveling public locate key economic development interests within the Redevelopment Area quickly and easily. The signage will create interest for the public to spend more time in the area, or identify places or activities that they may have otherwise not known about or explored. Downtown Pedestrian Bridge: The Downtown Pedestrian Bridge provides for the design and construction of a pedestrian bridge across Atascadero Creek and will link the Colony Square commercial development area with the downtown / Sunken Gardens area. It will create a convenient linkage for pedestrians to travel, shop, and dine more easily in the currently underutilized downtown core and will enhance pedestrian and motor traffic in that area. Downtown Parking: The proposed parking lot in the downtown core will make it easier and more convenient for the public to visit the businesses and activities in this portion of the Redevelopment Area. The offsite parking allows commercial land to be fully developed with building square footage, with little or no area dedicated to parking spaces. Downtown Restrooms: The restroom facility will reduce the need for unsightly portable toilet facilities during community events, enhance the area for additional business and recreational activities, and will also reduce homeless or other individuals from using the creek riparian area for the same purpose. Downtown Property Purchase: The Downtown core is currently characterized as older underutilized structures with current business activities that are not consistent with the City’s economic development goals. The purchase of property would allow the RDA to create a seed project that will set the tone both architecturally and functionally in a manner consistent with RDA Plan and community vision. Archway Sign: The proposed archway sign will create a strong attrac tive architectural element that signifies the Downtown core “place”. It will establish an architectural theme that other building renovations or new construction can incorporate that will help create a unifying theme for the downtown area. Creek Trail Extension: The creek trail extension will create a landscaped and suitably maintained pedestrian corridor that links the Downtown and Redevelopment Area together making the public’s experience of shopping, dining or recreating in the area easier and more enjoyable. It will also reduce vehicular traffic and air pollution in the area by supplying an alternative mode of transportation. Creek Improvements: Atascadero Creek is a major riparian corridor through the downtown, and it provides flood control prote ction, passive recreation and wildlife habitat. The proposed Creek Improvement project provides for creek clean up, bank stabilization, and will enhance the visual appearance of the creek as well as help maintain it in a healthy condition. Maiden Statue Restoration: The Maiden Statue is also known as the Wrestling Bacchantes and was created by the Italian artist Petrilla and exhibited at the 1904 World’s Fair by the Italian Government. Atascadero’s Founder, E.G. Lewis, purchased it for display in the Civic Center. It was located in the City’s downtown and included in the Redevelopment Project Area at the time that it was transported to Cambria, California, for restoration. The Statue has suffered from years of vandalism, neglect and well intended but inappropriate modifications that resulted in a dilapidated condition. The proposed restoration Project of the Statue will revitalize it to a near original condition, provide a suitable protective enclosure to help pres erve the beauty into the future, and provide for relocation and installation of the Statue to an appropriate location in Atascadero. Downtown Streetscape: The Project will replace an older, blighted concrete bridge railing that not only looks poorly but also does not meet current highway safety standards. The decorative railing, pilasters and lighting will enhance the safety and appearance of the bridge over Atascadero Creek. Downtown Lighting Project: Portions of the downtown are dark and unsuitable for pedestrian use at night-time. Consequently businesses have not thrived, nor are they open after dark in the area, leading to a reduced ability of owners to invest in the appearance of their buildings / businesses. The improved lighting will allow businesses to effectively stay open later, enhance safety, deter crime, improve sales and reinvest in the structure appearance. Lewis Avenue Bridge Project: The Lewis Avenue Bridge Project provides for the required contractual Atascadero Creek maintenance and vegetation control necessary as a result of the recent construction of the Lewis Avenue Bridge over the Atascadero Creek. The bridge enhances pedestrian and motor traffic in and around the Downtown area. No Other Method of Financing With the condition of the local, state, and national econom y, the City has reduced the general fund budget. All but the highest Council priorities have been cancelled or postponed. The City has indicated to the Agency that sufficient funding is not otherwise available. It is not practical to arrange for an assessment district or other funding mechanism for the Project at this time. Zoo Wall Improvement Project The Redevelopment Agency contracted with the City on December 8, 2009 for the completion of the Zoo Wall Improvement Project. At that time construction was estimated at $240,000. Since that time, the Project has been better defined and a more current estimate has been established at $420,000. This increase requires a change order to the original contract with the City, for both the time allotted and the funding allocated and a budget amendment reflecting the net zero increase in revenues and expenses. FISCAL IMPACT: No net fiscal impact. Receipt of $8,176,820 from the Community Redevelopment Agency of Atascadero. Expenditure of $8,176,820 on Agency Identified Blight Elimination Projects. ATTACHMENTS: 1. Draft Resolution 2. Draft Financing Contract – Agency Identified Blight Elimination Projects FINANCING CONTRACT HISTORIC CITY HALL PROJECT THIS FINANCING CONTRACT (“Contract”) is made and entered into this 14th day of January, 2011 by and between the CITY OF ATASCADERO, a general law city and municipal corporation (“City”) and the COMMUNITY REDEVELOPMENT AGENCY OF ATASCADERO, a public body, corporate and politic (“Agency”). Hereinafter, City and Agency shall be referred to collectively as the “Parties” and singularly as the “Party.” R E C I T A L S WHEREAS, the City Council previously adopted a Redevelopment Plan (the “Redevelopment Plan”) for a redevelopment project area (the “Project Area”); and, WHEREAS, the Agency is vested with responsibility pursuant to the Community Redevelopment Law (Part 1 of Division 24 of Health and Safety Code of the State of California) (the “Law”) to implement the Redevelopment Plan both within and without the Project Area; and, WHEREAS, on December 22, 2003, the San Simeon earthquake, declared a natural disaster by the President of the United States, severely damaged the historic City Hall building, located in the Project Area within the City; and, WHEREAS, the City has commenced a construction project to rehabilitate the Historic City Hall (the “Project”), which public facilities upon their completion will be owned and operated by the City; and, WHEREAS, the Project includes design, de-construction, construction, project/construction management, inspection, testing, permitting, construction support, grant administration, general conditions and other costs associated with the repair, hazard mitigation and rehabilitation of the Historic City Hall, its grounds, adjacent parking lot and adjacent public infrastructure; and, WHEREAS, the Project is estimated to cost $42,926,000, of which the majority of the funding will come from Federal and State grant funds due to the historic nature of the City Hall and the fact that it was damaged in a natural disaster, but there remains a gap between the total estimated cost of the Project and the amount of grant funds and other public funds available for the Project; and, WHEREAS, the City lacks sufficient capital or general funds available which could be used to fully fund the Project and bring it to completion and it is not practical to arrange for assessment district or similar financing for the Project; and, WHEREAS, the Project will address the goals and objectives of the Redevelopment Plan for the Project Area and will be of benefit to the Project Area in that the Project will attract additional tourists, assist with improving physical aesthetics, and alleviate blighting conditions in the area serving as the gateway to the Project Area; and, 2 WHEREAS, the Project is consistent with and will promote the Agency’s Implementation Plan; and, WHEREAS, on July 27, 2010, the Board approved a reimbursement agreement by and between the City and the Agency to provide for the Agency to reimburse the City for the City’s repayment of bonds issued by the City to assist with the financing of the Project; and, WHEREAS, the Agency is authorized by the California Redevelopment Law to enter into a binding contract with the City pursuant to which the Agency will irrevocably commit the Agency Funds and the Agency Loan to the Project and due to the Agency’s reimbursement obligation the Agency intends to provide funding in the amount of $13,000,000.00 (“the Agency Funds”) to assist the City with the cost of the Project because the Project will directly benefit the Project Area; and, WHEREAS, pursuant to Health and Safety Code Section 33445, and specifically subsection (e)(2)(B) of that Section, the Agency may, with the consent of the City Council, pay part or all of the cost of the construction of the Project if the Board and the City make certai n specified findings; and, WHEREAS, a duly noticed public meeting of the Agency was held on January 14, 2011 wherein the Agency adopted Resolution No. RA 2011-002 making all required findings for the use of Agency monies for the Project pursuant to Section 33445. NOW, THEREFORE, the Parties hereto state and agree as follows: 1. The purpose of this Contract is to set forth the understanding and agreement of the Parties with respect to the Agency’s commitment to fund the Project through reimbursement of the City’s share of Project costs, up to a defined amount. The contents of this Contract are intended to be as comprehensive as possible with respect to the Agency’s commitment of Agency Funds (as defined in paragraph 3 of this contract) to the Project yet not exhaustive with respect to additional issues and expenses that may arise relative to the development of the Project. In the event that issues and expenses occur that are not identified in this Contract, the Parties agree to work together in good faith to resolve each matter. 2. The Parties understand that the City will be required to complete final planning and public bidding required on the Project. Those final plans and the public bidding are prerequisites for the City’s construction of the Project, including the improvements that will be of benefit to the Project Area. 3. The estimated total cost of the Project is $42,926,000 (“Total Cost”). The Agency anticipates that the Project will address the goals and objectives of the Redevelopment Plan for the Project Area and will be of benefit to the Project Area by alleviating blighting conditions, attracting additional tourists, and assisting with improving physical aesthetics.. The Agency has agreed to commit a total sum of thirteen million dollars and no cents ($13,000,000.00) (“Agency Funds”) to the Project to pay for the Project’s direct benefit to the Project Area. 4. The Parties agree that the Agency shall use the Agency Funds to the extent that such funds have not been previously committed to pay for and/or reimburse City for costs and 3 expenses associated in any way with the Project including, but not limited to, services and costs for design, de-construction, construction, project/construction management, inspection, testing, permitting, construction support, grant administration, general conditions and other costs associated with the repair, hazard mitigation and rehabilitation of the Historic City Hall, its grounds, adjacent parking lot and adjacent public infrastructure. Any previous commitment by the Agency of Agency Funds to the Project shall be deducted from the $13,000,000.00 total amount of Agency Funds available for the Project. 5. Within thirty (30) business days of the Parties executing this Contract, Agency shall segregate the sum of thirteen million dollars and no cents ($13,000,000.00), less any of Agency Funds already spent to date on the Project, within the Agency’s accounts to be held in a separate account (“Historic City Hall Project Account”) to pay the Agency’s share of the Project costs. The Agency Funds shall be held in the Historic City Hall Project Account until 2 months from the latest of the date the project is completed, the date of the final invoice, or the date of resolution of the final audit by regulatory/granting agencies. The City shall request reimbursement from the Agency for Project costs actually incurred and the Agency shall reimburse the City from the Agency Funds from the Historic City Hall Project Account. 6. The City understands and agrees that a portion of the source of the Agency Funds may be the proceeds of tax exempt bonds secured by the tax increment revenue the Agency receives pursuant to California Health and Safety Code Section 33670 (the “Bonds”). The City covenants and agrees with respect to the Project to comply with all applicable requirements of the federal Internal Revenue Code necessary to preserve the tax -exempt status of the interest on the Bonds and specifically covenants, without limiting the generality of the foregoing, as follows: (a) Private Activity. The City will take no action or refrain from taking any action or make any use of the proceeds of the Bonds or of any other monies or property which would cause the Bonds to be “private activity bonds” within the meaning of Section 141 of the Internal Revenue Code of 1986, as amended; and (b) Arbitrage. The City will make no use of the proceeds of the Bonds or of any other amounts or property, regardless of the source, or take any action or refrain from taking any action which will cause the Bonds to be “arbitrage bonds” within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended; and (c) Federal Guaranty. The City will make no use of the proceeds of the Bonds or take or omit to take any action that would cause the Bonds to be “federally guaranteed” within the meaning of Section 149(b) of the Internal Revenue Code of 1986, as amended; and (d) Information Reporting. The City will cooperate with the Agency in providing information that the Agency needs to comply with the informational reporting requirement of Section 149(e) of the Internal Revenue Code of 1986, as amended; and (e) Hedge Bonds. The City will make no use of the proceeds of the Bonds or any other amounts or property, regardless of the source, or take any action or refrain from taking any action that would cause the Bonds to be considered “hedge bonds” within the meaning of 4 Section 149(g) of the of the Internal Revenue Code of 1986, as amended, unless the City takes all necessary action to assure compliance with the requirements of Section 149(g) of the of the Internal Revenue Code of 1986, as amended, to maintain the tax exempt status of interest on the Bonds for federal income tax purposes and such action has been approved by the Agency. 7. In contemplation of the provisions of Section 895.2 of the California Government Code imposing certain tort liability jointly upon public entities solely by reason of such entities being Parties to an agreement as defined in Section 895 of said code, the Parties hereto, as between themselves pursuant to the authorization contained in Sections 895.2 and 895.6 of said code, will each assume the full liability imposed upon it or any of its officers, agents or employees by law for personal injury, property damage or loss to third Parties caused by a negligent or wrongful act or omission of that party occurring in the performance of the Contract. To achieve the above stated purpose, each party indemnifies and holds harmless the other party for any damage, loss, cost or expense arising out of its own negligent or wrongful acts or omissions. 8. This obligations, as set forth herein, are binding on the successors, assigns or heirs, including any private or public entities, of both parties. 9. This Contract shall be governed by the laws of California and represents the entire agreement of the Parties as to the subject matter of this Contract. IN WITNESS WHEREOF, the City and Agency have approved the foregoing FINANCING CONTRACT effective January 14, 2011, and caused the same to be executed by their duly authorized officers as set forth below. AGENCY CITY By:_________________________________ By:________________________________ Wade G. McKinney Wade G. McKinney Executive Director City Manager ATTEST: ATTEST: By:_________________________________ By:________________________________ Marcia McClure Torgerson, C.M.C. Marcia McClure Torgerson, C.M.C. Board Secretary City Clerk Date:________________________________ Date:_________________________________ APPROVED AS TO FORM APPROVED AS TO FORM Community Redevelopment Agency City of Atascadero of Atascadero By:__________________________________ By:________________________________ Brian A. Pierik, Agency General Counsel Brian A. Pierik, City Attorney RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ATASCADERO, CALIFORNIA, CONFIRMING THE ALLOCATION OF FUNDS FOR COMPLETION OF THE CITY OF ATASCADERO’S HISTORIC CITY HALL PROJECT WHEREAS, the City Council for the City of Atascadero (the “City”) has adopted the Redevelopment Plan for the Project Area (the “Redevelopment Plan”); and, WHEREAS, the Community Redevelopment Agency of Atascadero (the “Agency”) and the Agency Board of Directors (“Board”) is vested with responsibility pursuant to the Community Redevelopment Law (Part 1 of Division 24 of Health and Safety Code of the State of California) (the “Law”) to implement the Redevelopment Plan in the Project Area; and, WHEREAS, on December 22, 2003, the San Simeon earthquake, declared a natural disaster by the President of the United States, severely damaged the historic City Hall building, located in the Project Area within the City; and, WHEREAS, the City has commenced a construction project to rehabilitate the Historic City Hall (the “Project”), which public facilities upon their completion will be owned and operated by the City; and, WHEREAS, the Project includes design, de-construction, construction, project/construction management, inspection, testing, permitting, construction support, grant administration, general conditions and other costs associated with the repair, hazard mitigation and rehabilitation of the Historic City Hall, its grounds, adjacent parking lot and adjacent public infrastructure; and, WHEREAS, the Project is estimated to cost $42,926,000, of which the majority of the funding will come from Federal and State grant funds due to the historic nature of the City Hall and the fact that it was damaged in a natural disa ster, but there remains a gap between the total estimated cost of the Project and the amount of grant funds and other public funds available for the Project; and, WHEREAS, the Project will address the goals and objectives of the Redevelopment Plan for the Project Area and will be of benefit to the Project Area in that the Project will alleviate blighting conditions, attract additional tourists and assist with improving physical aesthetics; and, WHEREAS, the Project is consistent with and will promote the Agency’s Implementation Plan; and, WHEREAS, the construction of the Project conforms to the General Plan of the City; and, WHEREAS, a portion of the funding for the Project is through federal and state reimbursement grants; and, WHEREAS, pursuant to Health and Safety Code Section 33445, the Agency may, with the consent of the City, pay part or all of the cost of the Project if the Board and the City make certain specified findings; and, WHEREAS, the Agency has made the requisite findings pursuant to section 33445 and has committed to provide the City with a grant of money for the Project (“Agency Funds”) as well as access to additional funds on a loan basis (“Agency Loan”); and, WHEREAS, in the absence of the Agency Funds and the Agency Loan, the City would lack sufficient capital or general funds available which could be used to undertake the Project and bring it to completion and it is not practical to arrange for assessment district or si milar financing for the Project; and, WHEREAS, the staff report to the City Council at its meeting held on January 14, 2011 (the “Staff Report,” incorporated herein by reference), which sets forth facts supporting the findings made in this Resolution pursuant to Section 33445 of the Health and Safety Code, has been prepared to accompany this Resolution. NOW, THEREFORE BE IT RESOLVED by the City Council of the City of Atascadero: 1. That the City Council hereby finds and determines pursuant to California Health and Safety Code section 33445 that: (a) the Project will be of benefit to the Project Area by helping to eliminate blight within the Project Area; (b) no other reasonable method of financing the gap between the total cost of construction of the Project and the funds available to the City is available to the community; (c) Agency assistance for the Project is consistent with the Agency’s current Implementation Plan. The factual and analytical basis used by the Agency in making these findings and determinations is set forth in the Staff Report, and records regarding the Project. 2. That the City Council further finds and determines that pursuant to California Health and Safety Code section 33445(e)(2)(B), the use of tax increment funds for the Project is authorized because the City Hall was damaged in a earthquake that was declared by the President of the United States to be a natural disaster. 3. That the City Council consents to the Agency’s financial commitment to the Project and desires that the Project continue to move forward in a manner that will most effectively provide the foregoing benefits to the Project Area. 4. That the City Council consents to the Agency expenditure of the Agency Funds and Agency Loan set forth in the Contract, between the Agency and the City and submitted to the Agency in connection with consideration of this Resolution. 5. That the City Council directs the City Manager to execute the Contract with the Agency concerning the Agency Funds. 6. That the City Council hereby authorizes the City Manager to execute the Agency Loan. IT IS FURTHER RESOLVED AND ORDERED that this resolution will become effective upon the effective date of approval by the City Council. On motion by Council Member ___________________ and seconded by Council Member _____________________, the foregoing resolution is hereby adopted in its entirety on the following roll call vote: AYES: NOES: ABSENT: ADOPTED: CITY OF ATASCADERO By:__________________________ Tom O’Malley, Mayor ATTEST: _______________________________ Marcia McClure Torgerson, C.M.C., City Clerk APPROVED AS TO FORM: _______________________________ Brian A. Pierik, City Attorney ITEM NUMBER: #1 DATE: 01/14/11 Atascadero City Council Staff Report – Administrative Services Historic City Hall Project Contract and Loan Agreement RECOMMENDATIONS: Council: 1. Adopt the Draft Resolution confirming the allocation of funds for completion of the City of Atascadero’s Historic City Hall Project; and 2. Authorize the City Manager to execute a Financing Contract between the Community Redevelopment Agency of Atascadero and the City of Atascadero, for the Historic City Hall Project; and 3. Authorize the Mayor to execute a Loan Agreement with the Community Redevelopment Agency of Atascadero for the Historic City Hall Project. DISCUSSION: The Redevelopment Agency Board has indicated, through past actions, that the Historic City Hall Project is a high priority. This priority is high enough that project costs outside the work that will be reimbursed by FEMA, Cal EMA and CCHE have been budgeted to be funded with Agency general funds and proceeds from the recent bond issue. The Agency began budgeting for this project in fiscal year 2006-2007 and funding for the Project is included in the Agency’s budget. Construction activities for the Project have begun and bond/reimbursement agreement proceeds are now available. Since the earthquake occurred in fiscal year 2003/2004, the Redevelopment Agency has demonstrated financial commitment to the Project by: Repeated budgeting for cash contributions (transfers) to the City’s Historic City Hall Project Fund in order to fund expected Project amounts that will not be paid for by FEMA, CalEMA, CCHE or other funding sources. Entering into a financing arrangement in order to fund the Project. (In order to receive a lower interest rate, the City issued bonds, but the Agency receive d the bond proceeds and is responsible for paying all debt service on the Bonds.) Providing “Due To /Due From” cash advances to the City’s Historic City Hall Project Fund in order to pay invoices while waiting for grant determinations and reimbursements In order to protect funding for this Project, the City and Agency need to formalize and document the Agency’s commitment to complete the Historic City Hall Project. Staff is recommending that the Council take the following two actions: (1) Authorize the City Manager to execute a Financing Contract with the Redevelopment Agency in order to receive funding for the completion of the Project. This Contract commits the Agency to pay a total of $13,000,000 for the Project. This commitment is part of a legally binding financing agreement with the City and once pledged, cannot be reversed. The City will only receive reimbursement for actual amounts spent and any additional administrative funds and any funds remaining at the end of the project will be returned to the Agency. (2) Authorize the City Manager to execute a Loan Agreement with the Redevelopment Agency in order to provide the necessary cash flow for the Project. This agreement commits the Agency to loan the City up to a maximum outstanding amount of $10,000,000 for cash flow needs of the Project. This loan is intended to be a revolving loan whereby the City borrows enough to pay immediate costs associated with the Project, and then immediately pays back the Agency as it receives cash/reimbursement from the other funding sources. Execution of this agreement commits the City to completing the Historic City Hall Project and being reimbursed by the Agency (up to $13,000,000) for the Project. The City will be reimbursed for actual costs incurred and shall not receive any additional administrative funds from the Agency. Any funds remaining at the end of the Project shall revert to the Agency. FISCAL IMPACT: No net fiscal impact. Receipt of $13,000,000 and $10,000,000 in loan funds from the Community Redevelopment Agency of Atascadero. Expenditure of $13,000,000 on the Historic City Hall Project. ATTACHMENTS: 1. Draft Resolution 2. Draft Financing Contract - Historic City Hall Project 3. Draft Loan Agreement – Historic City Hall Project LOAN AGREEMENT FOR HISTORIC CITY HALL PROJECT 1. PARTIES AND EFFECTIVE DATE 1.1 Parties to this Agreement. The parties to this Loan Agreement (“Agreement”) are (i) The Redevelopment Agency of the City of Atascadero (“Agency”), a public body, and (ii) The City of Atascadero (“City”), a California municipal corporation. This Agreement is dated as of January 14, 2011, for reference purposes only. This Agreement will not become effective until the Effective Date described in Section 1.2 below.1 1.2 Effective Date. This Agreement will become legally effective and binding as of the date (“Effective Date”) on which this Agreement has been approved by the City Council and the Agency’s governing board and executed by the City’s and Agency’s duly authorized representatives. 2. RECITALS. 2.1 The City Council previously adopted a Redevelopment Plan (the “Redevelopment Plan”) for a redevelopment project area (the “Project Area”). 2.2 The Agency is vested with responsibility pursuant to the Community Redevelopment Law (Part 1 of Division 24 of Health and Safety Code of the State of California) (the “Law”) to implement the Redevelopment Plan both within and without the Project Area. 2.3 On December 22, 2003, the San Simeon earthquake, declared a natural disaster by the President of the United States, severely damaged the historic City Hall building, located in the Project Area within the City. 2.4 The City has commenced a construction project to rehabilitate the Historic City Hall (the “Project”), which public facilities upon their completion will be owned and operated by the City. 2.5 The Project includes design, de-construction, construction, project/construction management, inspection, testing, permitting, construction support, grant administration, general conditions and other costs associated with the repair, hazard mitigation and rehabilitation of the Historic City Hall, its grounds, adjacent parking lot and adjacent public infrastructure. 1 All Section references shall be to Sections of this Agreement, unless otherwise stated. Loan Agreement Atascadero Redevelopment Agency & City of Atascadero Page 2 2.6 The Project is estimated to cost $42,926,000, of which the majority of the funding will come from Federal and State grant funds due to the historic nature of the City Hall and the fact that it was damaged in a natural disaster, but there remains a gap between the total estimated cost of the Project and the amount of grant funds and other public funds available for the Project. 2.7 The City lacks sufficient capital or general funds available which could be used to fully fund the Project and bring it to completion and it is not practical to arrange for assessment district or similar financing for the Project. 2.8 The Project will address the goals and objectives of the Redevelopment Plan for the Project Area and will be of benefit to the Project Area in that the Project will attract additional tourists, assist with improving physical aesthetics, and alleviate blighting conditions in the area serving as the gateway to the Project Area. 2.9 The Project is consistent with and will promote the Agency’s Implementation Plan. 2.10 Pursuant to Health and Safety Code Section 33445, and specifically subsection (e)(2)(B) of that Section, the Agency may, with the consent of the City Council, pay part or all of the cost of the Project if the Board and the City make certain specified findings. 2.11 Pursuant to Health and Safety Code 33125, th e Agency has the general power to execute instruments necessary or convenient to the exercise of its powers and may therefore enter into an agreement to loan funds for the Project; and 2.12 The Agency Board approved, via adoption of Resolution No. RA 2011-002 at a duly noticed public meeting of the Agency on January 14, 2011, this no-interest loan agreement with the City to meet the cash flow needs of the Project while the City is waiting for Federal and State grant funds and any other reimbursement grants funds made by third parties to be forwarded to meet incurred Project costs. 2.13 Wherein the Agency adopted Resolution No. RA 2011-002 making all required findings for the use of Agency monies for the Project pursuant to Section 33445. 3. TERMS. 3.1 Loan Amount; Disbursement of Funds; Repayment of Funds. Loan Agreement Atascadero Redevelopment Agency & City of Atascadero Page 3 3.1.1 Loan Amount. Agency hereby commits to keep on reserve an amount not to exceed ten million dollars and zero cents ($10,000,000.00) (“Agency Loan”). The entire Loan Amount shall be reserved for the duration of the Project to serve as a revolving loan or series of bridge loans to keep the Project’s cash flow liquid during periods in which the City is awaiting reimbursement by the Federal or State government for amounts to which one or both of those governments have pledged to provide funding or is awaiting any other grants made by third parties that would create a situation in which the City would experience a delay between submitting a request for payment and receipt of payment such that the Agency Loan could be necessary to provide sufficient cash flow for the Project. . 3.1.2 Disbursement of Funds. The Agency agrees to disburse to the City all or any portion of the total Agency Loan amount upon request by the City. 3.1.3 Projected Repayment of Funds. City agrees to repay to Agency outstanding loan proceeds within thirty (30) days of receipt of grant funds from the Federal or State government(s), or funds from other third party sources. City shall complete the repayment of outstanding loan proceeds within three (3) years of the final disbursement of Federal and State grant funds following completion of the Project audit by the Federal Emergency Management Agency. 3.2 Interest. Any and all portions of the Agency Loan disbursed by the Agency to the City shall not bear interest. 3.3 Commitment to Complete Repayment. In the event the Federal or State government or other third party granting entity does not fulfill its obligation to disburse to City the grant funds that the parties anticipate will be available to repay the Agency Loan, City agrees to repay the Agency Loan, or any portion thereof demanded by the Agency, within ten (10) days following demand by the Agency, provided that such demand may not be made prior to the sixth (6th) anniversary of the completion of the Project. 3.4 Subordination. The City’s obligations hereunder shall be paid primarily from the grant funds available to the City from the Federal and State governments for completion of the Project. Obligations not paid out of these funds shall be paid out of all legally available funds of the City. The City’s obligations under this Agreement are subject and subordinate to Loan Agreement Atascadero Redevelopment Agency & City of Atascadero Page 4 any preexisting City indebtedness including, without implied limitation, bonded indebtedness, and to any other indebtedness including, without implied limitation, bonded indebtedness, which is incurred subsequent to the Effective Date of this Agreement. Without any further action or agreement required of the Agency, the Agency hereby expressly subordinates to any and all such City indebtedness, either heretofore or hereafter incurred, the Agency’s right to receive repayment of all or any portion of the Loan. 3.5 No Third Party Beneficiaries. This Agreement is for the sole and exclusive benefit of the Agency and the City. No person or entity not a party to this Agreement is intended to be benefited by any provision of this Agreement and no person or entity not a party to this Agreement shall have any rights, causes of action, or claims against either the Agency or the City due to the fact either the Agency’s and/or the City’s entry into and performance or non- performance pursuant to this Agreement. 3.5 Counterpart Originals. This Agreement may be executed in two (2) counterpart originals, each of which shall be deemed to be an original, but, when taken together, shall constitute one and the same instrument. CITY OF ATASCADERO COMMUNITY REDEVELOPMENT AGENCY A California Municipal Corporation OF ATASCADERO A California Public Agency By:____________________________ By:_________________________________ Tom O’Malley, Mayor Wade McKinney, Executive Director ATTEST: ______________________________ ____________________________________ Marcia McClure Torgerson, City Clerk Marcia McClure Torgerson, Board Secretary Date:__________________________ Date:________________________________ APPROVED AS TO FORM: ______________________________ ____________________________________ Brian A. Pierik, City Attorney Brian A. Pierik, Agency General Counsel ITEM NUMBER: #4 DATE: 01/14/11 City of Atascadero Staff Report – Administrative Services Contract Services for Blight Reduction and Economic Growth RECOMMENDATION: Council authorize the City Manager to execute a Financing Contract with the Community Redevelopment Agency of Atascadero for contract services for blight reduction and economic growth. DISCUSSION: The Agency Board has indicated, through past actions, that the reduction of blight and economic growth are high priorities. The Agency has put considerable investment into economic development, Downtown maintenance and beautification, tourism, marketing and promotions to enhance the Project Area. Section 33126(b) of the State Health and Safety Code dictates that the Agency may contract with any other agency, for the furnishing of any necessary staff services associated with or required by redevelopment and which could be performed by the staff of an agency. In other words, the Agency may contract with the City of Atascadero for blight reduction and economic growth services. The activities that have been provided to date by the Agency include but are not limited to: Economic Growth: Investment in the City’s Office of Economic Development Staff time or professional services toward economic development The Façade Improvement Program Site Design Assistance / Design Guidelines Economic Development Studies Permit Fee Waiver Program Sign Program Legal services and pertinent professional development of staff Other economic stimulus services 2 Tourism, Marketing and Promotions: Advertising Special Events Visitor’s and Conference Bureau Tourism, marketing and promotions contract Other tourism, marketing or promotion services Downtown Maintenance and Beautification: Sunken Gardens maintenance and costs Downtown landscape maintenance Downtown tree trimming Fountain maintenance Sidewalk steam cleaning Street sweeping Empty trash cans Trash pick-up and weeding Spot maintenance Janitorial service-trash pick-up Sunken Gardens holiday enhancements Other downtown maintenance and beautification Administration: Independent auditor services Professional legal services Supplies and administrative staff time Other administration services The contract between the Agency and the City is for a period of seven (7) years. After that time, the Agency and the City will re-evaluate the need for such services and will, at that time, negotiate an additional contract if desired by both parties. FISCAL IMPACT: No net fiscal impact. Receipt of $5,621,180 from the Community Redevelopment Agency of Atascadero; Expenditure of $5,621,180 on Blight Reduction and Economic Growth. ATTACHMENT: 1. Draft Financing Contract - Blight Reduction and Economic Growth FINANCING CONTRACT CONTRACT SERVICE FOR BLIGHT REDUCTION AND ECONOMIC GROWTH THIS CONTRACT (“Contract”) is made and entered into this 14th day of January, 2011 by and between the CITY OF ATASCADERO, a general law city and municipal corporation (“City”) and the COMMUNITY REDEVELOPMENT AGENCY OF ATASCADERO, a public body, corporate and politic (“Agency”). Hereinafter, City and Agency shall be referred to collectively as the “Parties” and singularly as the “Party.” R E C I T A L S WHEREAS, the City Council previously adopted a Redevelopment Plan (the “Redevelopment Plan”) for a redevelopment project area (the “Project Area”); and, WHEREAS, the Agency is vested with responsibility pursuant to the Community Redevelopment Law (Part 1 of Division 24 of Health and Safety Code of the State of California) (the “Law”) to implement the Redevelopment Plan both within and without the Project Area; and, WHEREAS, the City and Agency have declared blight elimination and economic development to be a top priority; and, WHEREAS, the Agency is tasked with eliminating blight in the Redevelopment Area by creating jobs, improving properties, and attracting new businesses through marketing and business attraction efforts; and, WHEREAS, the Agency is given certain legal abilities that provide a revenue stream for these activities including collecting tax increment and issuing financings; and, WHEREAS, the Agency has used these revenues to purchase properties, build capital projects, and implement programs that market and develop the community's economy; and, WHEREAS, the City has commenced a number of activities to reduced blight and promote economic growth (the “Contract Service”), including but not limited to: Economic Development – services may include but are not limited to providing an Office of Economic Development; implementing a Façade Improvement Program; providing Site Design Assistance; executing a Permit Fee Waiver Program; conducting Economic Development Studies; implementing a Sign Program; and providing other economic stimulus programs in the Redevelopment Area Tourism, Marketing and Promotion – services may include but are not limited to advertising; conducting special events; supporting the Visitors & Conference Bureau; providing a Tourism, Marketing and Promotion Program; and providing other tourism, marketing and promotion services 2 Downtown Maintenance and Beautification – services may include but are not limited to providing a higher maintenance level in the Sunken Gardens; maintenance downtown streetscape and landscape; downtown tree trimming services; Sunken Gardens fountain maintenance; steam cleaning of the downtown sidewalks; street sweeping in the downtown core; trash pickup and other extra maintenance services in the downtown core; provision and maintenance of holiday enhancements; and other downtown maintenance and beautification services Administration – includes administrative costs related to the provision and funding economic development, tourism, marketing, promotion and downtown maintenance and beautification. Services may include, but are not limited to l egal fees; invoice payment; record retention services; audit services; and other administrative services; and, WHEREAS, the Contract Service addresses the goals and objectives of the Redevelopment Plan for the Project Area and will be of benefit to the Project Area in that the Contract Service will alleviate blighting conditions, attract additional tourists and assist with improving physical aesthetics; and, WHEREAS, the Contract Service is consistent with and will promote the Agency’s Implementation Plan; and, WHEREAS, Section 33126(b) of the Law dictates that the Agency may contract with any other agency, for the furnishing of any necessary staff services associated with or required by redevelopment and which could be performed by the staff of an agency; and, WHEREAS, the Agency is authorized by the California Redevelopment Law to enter into a binding contract with the City pursuant to which the Agency will irrevocably commit the Agency Funds to the Contract Service the Agency intends to provide funding in the amount of $5,621,180 (“the Agency Funds”) to assist the City with the cost of the Contract Services because the Contract Services will directly benefit the Project Area; and, WHEREAS, the Agency desires to contract for Contract Services for a period of seven years; and, WHEREAS, a duly noticed public meetin g of the Agency was held on January 14, 2011 wherein the Agency adopted Resolution No. ________ making all required findings for the use of Agency monies for the Contract Service. NOW, THEREFORE, the Parties hereto state and agree as follows: 1. The purpose of this Contract is to set forth the understanding and agreement of the Parties with respect to the Agency’s commitment to fund the Contract Service. The contents of this Contract are intended to be as comprehensive as possible with respect to the Agency’s commitment of Agency Funds to the Contract Service yet not exhaustive with respect to additional issues and expenses that may arise relative to the development of the Contract Service. In the event that issues and expenses occur that are not identified in this Contract, the Parties agree to work together in good faith to resolve each matter. 3 2. The Parties understand that the City will be required to complete public bidding as required on the Contract Service. The public bidding may be prerequisites for the City’s Contract Service activities, including improvements that will be of benefit to the Project Area. 3. The Agency anticipates that the Contract Service will address the goals and objectives of the Redevelopment Plan for the Project Area and will be of benefit to the Project Area by alleviating blighting conditions, attracting additional tourists, and assisting with improving physical aesthetics. The Agency has agreed to commit a sum of five million six hundred twenty-one thousand one hundred eighty dollars and no cents ($5,621,180.00) (“Agency Funds”) over the next seven fiscal years to pay for the direct benefit to the Project Area. 4. Within thirty (30) business days of the Parties executing this Contract, Agency shall segregate the sum of five million six hundred twenty-one thousand one hundred eighty dollars and no cents ($5,621,180.00), within the Agency’s accounts to be held in a separate account (“Economic Growth Account”) to pay the Contract Service costs for the next seven fiscal years. The City shall request reimbursement from the Agency for Contract Service costs actually incurred and the Agency shall reimburse the City from the Agenc y Funds from the Economic Growth Account. 5. The Agency agrees that, at the conclusion of seven fiscal years, the Agency and the City shall evaluate the success of the Contract Service activities to determine the future need of such Contract Service to benefit the Project Area. 6. In contemplation of the provisions of Section 895.2 of the California Government Code imposing certain tort liability jointly upon public entities solely by reason of such entities being Parties to an agreement as defined in Section 895 of said code, the Parties hereto, as between themselves pursuant to the authorization contained in Sections 895.2 and 895.6 of said code, will each assume the full liability imposed upon it or any of its officers, agents or employees by law for personal injury, property damage or loss to third Parties caused by a negligent or wrongful act or omission of that party occurring in the performance of the Contract. To achieve the above stated purpose, each party indemnifies and holds harmless the other party for any damage, loss, cost or expense arising out of its own negligent or wrongful acts or omissions. 7. This obligations, as set forth herein, are binding on the successors, assigns or heirs, including any private or public entities, of both parties. 8. This Contract shall be governed by the laws of California and represents the entire agreement of the Parties as to the subject matter of this Contract. IN WITNESS WHEREOF, the City and Agency have approved the foregoing Contract Service for Blight Elimination and Economic Growth effective January 14, 2011, and caused the same to be executed by their duly authorized officers as set forth below. 4 AGENCY CITY By:_________________________________ By:________________________________ Wade G. McKinney Wade G. McKinney Executive Director City Manager ATTEST: ATTEST: By:_________________________________ By:________________________________ Marcia McClure Torgerson, C.M.C. Marcia McClure Torgerson, C.M.C. Board Secretary City Clerk Date:________________________________ Date:_________________________________ APPROVED AS TO FORM APPROVED AS TO FORM Community Redevelopment Agency City of Atascadero of Atascadero By:__________________________________ By:________________________________ Brian A. Pierik, Agency General Counsel Brian A. Pierik, City Attorney