HomeMy WebLinkAbout01 TFYC LEASE 02-03-97DATE:
FEBRUARY 3, 1997
NO. 1
2-3-97
I n te r- C o
TO:
FROM:
SUBJECT:
WILLIAM A. HUSTON, crI~ MANAGER
REDEVELOPMENT AGENCY STAFF
SECTION 33433 APPROVAL FOR TUSTIN FAMILY AND YOUTH CENTER
LEASES AT 14722 NEWPORT AVENUE
[SUMMARY: State Comm~.ity Redevelopment Law requires the City Co~.cil to hold a
]hearing concerning any proposed sales and/or leases of Agency owned property and to approve the ]1
II...... prior to the Agency entering, into such lease&.. . . .
il
RECOMMENDATION
It is recommended that the City Council adopt Resolution No. 9%8, approving leases for a portion of
the Family and Youth Center located at 14722 Newport Avenue to The Orange Children and Parents
Together, Inc. and The Children's Bureau of Southern California.
·
BACKGROUND
Section 33433 of the California Community Redevelopment Law (CRL) requires that before any
property acquired in whole or in part by the Agency with tax increment moneys is sold and/or leased,
the sale and/or lease must first be approved by the City Council by resolution after a public hearing.
The law fxtnher requires that the Agency prepare, advertise and make available for public inspection, a
report concerning the leases, which includes the following information:
1. A copy of the proposed sale or lease.
2. A sunan~ which describes and specifies all of the following:
a) The cost of the Agreement to the Agency.
b) The estimated value of the interest to be conveyed or leased, determined at the highest
and best uses permitted under the plan.
c) The estimated value of the interest to be conveyed or leased, including an explanation
of the reasons for the difference between what the lease of the property would be under
current market conditions based on development costs on the proposed use and the
actual lease rates proposed.
William A. Huston
February 3, 1997
Page 2
d) An explanation of why the sale and lease of the property w/Il assist in the elimination of
blight.
e) An explanation of how the sale or lease of the property is consistent with the Five-Year
Implementation Plan adopted for the Project Area.
The Tustin Family and Youth Center is a 5,934 square foot building on a 22,500 square foot parcel of
land, located at the northeast comer of Newport Avenue and Sycamore Avenue. The Agency is
proPosing to lease a portion of the facility to The Orange Children and Parents Together, Inc. and
another portion to The Children's Bureau of Southern California.
The leases are also discussed in the report in the Redevelopment Agency Agenda, which is attached
herein as Attachment A. The following is summary of the lease terms:
The Orange Children and Parents Together, Inc
Lease Space:
Term of Lease:
Required use:
Initial Lease Rate
Payable to the Agency:
Estimated Annual Common Area Charges
Reimbursed to the City:
3,583 square feet of building and a
3,895 square foot outdoor playground area
5 years, with one five year extension
Licensed child care programs, specifically a
licensed Headstart program
$11,450, adjusted by the lesser of 4% per year
or the consumer price index
$16,695
The Children's Bureau of Southern California
Lease Space:
Term of Lease:
Required use:
Annual Lease Rate
Payable to the Agency:
Estimated Annual Common Area Charges
Reimbursed to the City:
543 square feet of building
5 years, with two five year extensions
Coordination of educational and social service
programs
$1,753, adjusted by the lesser of 4% per year
or the consumer price index
$2,556
Attached for the City Council's consideration is the Section 33433 Report for the proposed leases of
space within the Tustin Family and Youth Center.
William A. Huston
February 3, 1997
Page 3
The total cost of the'project to the Agency is estimated at $1,178,500, including $100,000 which was
provided to the project from the federal Community Development Block Grant (CDBG) program-
This cost includes $480,000 for acquisition, $60,000 for architectural and engineering services,
· $631,000 for remodeling the building and site and $7,500 for miscellaneous expenses.
Total estimated revenues to be returned to the Agency over the initial five-Year terms of the two leases
is $71,510. This represents a net cost ofthe project to the Agency of $1,006,990. Over the initial five-
year term, the City will also receive an estimated $111,710 reimbursement for common area charges.
This provides a combined five-year revenue to the Agency and the City of$183,220.
The CRL requires the statutory 33433 report to determine the difference between the value of the .
'~ghest and best use" for the property permitted by the Redevelopment Plan and the remm the
Agency is receiving under the proposed leases. Highest and best use is generally defined as a
theoretical use which would provide the best remm on investment 'of a property, given allowable uses
and conventional market conditions.
The current lease rates for similar retail facilities in the City of Tustin range between $.95 per
square foot and $1.15 per square foot, triple net (NNN). A triple net lease is a standard private
sector lease in which the lessee pays for taxes, utilities and maintenance. For the purposes of the
33433 Report,. a high point of this range of $1.15 per square foot was used. The proposed leases
were then compared against a private sector NNN lease resulting in the determination that the
highest and best value of lease revenues over a five-year term would be $443,536. With the
Agency's 5-year revenues of$71,510, the difference between the theoretical highest and best use lease
and the Agency's leases is $372,026.
There are several reasons for the difference between what the value of a lease interest at highest and
best use could have theoretically been and the proposed revenues that are anticipated to be paid to the
Agency. These reasom include:
The two agencies are 'leasing only 4,126 square feet of the building, or approximately 70% of
the building space. The City will control the remaining space. In the highest and best use
condition, the entire building would be leased.
Each of the proposed lessees are non-profit organiTations providing a critical social service to
low-to-moderate income residents living in the South Central Redevelopment Project Area.
The two lessees are dependent on government grants and other donations to fund their
operations and cannot meet private sector lease rates and provide the necessary level of service:
A private sector lessee would be able to adjust its business as well as revenues and expenses to
meet the market terms of a lease.
William A. Huston
February 3, 1997
Page 4
The lessees are paying lease rates 'which are based on the Agency's acquisition costs and will
reimburse the City for common area charges. It was assumed that the $631,000 cost of
remodeling the site and building'would be bom by the Agency because of the need for a facility
to accommodate recreational, child care and social service programs needed by the residents of
the Project Area.
The '33433 Report indicates that the proposed uses of the building eliminate bright because the
improvement of the property has eliminated an abandoned, boarded-up building which was not being
maintained. The property was also a dumping site for trash and other debris and the building was
falling into disrepair.
Finally, the project does conform with the Implementation Plan for the South Central Project Area,
which specifically identified an estimated $2,000,000 to be spent for facilities to serve the recreational
and other needs of children and families in the Project Area.
CONCLUSION
The report required by the Community Redevelopment Law has been properly advertised pursuant to
state law and made available to the public for review. No written comments have been received.
Attached is Resolution No. 97-8, approving the proposed lease being presented to the Redevelopment
Agency.
Christine Shi~let~n ' /] ·
Assistant City Manager ~,J
~edevelop~' gram Manager
ATTACHMENT A
REDEVELOPMENT AGENCY REPORT'
DATE:Februa,'7 3. 997 I n t e r- C o m
TO:
FROM:
SUBJECT:
William A. Huston, Executive Director
Community Services and Redevelopment Agency Staff
APPROVAL OF LEASE AGREEMENTS FOR THE
TUSTIN FAMILY & YOUTH CENTER (TFYC)
' - -- i i., r i ' "'n'.
SUMMARY: Approval .is requested for two Lease Agreements for a.portion of property
located at 14722'.N. ewport Avenue, 'de. scribed as ~e T .ustin.'Famiiy and'Youth Cen_ter.
I I · Ill lit · Il' I'
RECO~NDATIO~:
It is recommended that the Agency approve lease agreements (copies of which are attached to
Agenda Item #1.) with Orange Children and Parents Together, Inc. (OCPT) and the Children's
Bureau of Southern California (CBSC), for a portion of the Tustin Family& Youth Center, and
authorize the Assistant City Manager to execute the lease agreements after their execution by the
City Attorney.
FISCAL HVIPA(~TI':
The estimated lease revenue to be returned to the Redevelopment Agency over the initial five
year term of the two leases is $71,510.
The estimated prorated portion of common area operating costs to be reimbursed by both leases
over the initial five year term is estimated at $111,710. This amount will be transferred from the
Agency and credited to the TFYC operating budget in the General Fund.
BACKGROUND/DISCUSSION:
The TFYC is scheduled to be fully opened in late February..The 5,934 sq.ft, neighborhood
se~ice center will provide a full range of family and youth-oriented social, educational and
recreation programs; and serve as a resource referral center for families and youth of Southwest
Tustin in need and at risk, and for individuals seeking self-impr°vement and vocational
opportunities. Services will be provided by member agencies of the TAFFY (Tustin Acts For
Families & Youth) Coalition, primarily through implementation of Healthy Start and Family
Preservation Grants by the Children's Bureau of Southern California (CBSC) and Orange Children
and Parents Together, Inc. (OCPT), as well as the City's Community Services Department. The
Agency is also proposing to lease a portion of the facility to OCPT and CBSC.
The OCPT.lease space includes 3,583 sq.ft, of the facility and'a 3,895 sq.fl, outdoor playground
February 3, 1997
Page 2
area. OCPT will provide licensed Head Start programming, providing child care and readiness
programs to 51 neighborhood children, ages 3¼ to 5. years. The CBSC lease space would include
543 sq.ft, of the facility and be used to coordinate educational and special service programs.
Both lessees are obligated to make annual payments. Payments are based on a base rent for the
use of the land and a prorated share of reimbursable operating costs, such as utilities and
janitorial services. The following table illustrates the initial first year tenant rent obligations:
I
LESSEE INITIAL INITIAL ESTIMATED TOTAL
BASE RENTS .REIMB. ~ABLE PA.YMENT
". OPERATING.COSTS
·
·
OCPT $11,450.00 $ 16,696.00 $ 28,146.00
CBSC $1,753.00 $2,556.40 $4,309.40
TOTAL $13,203.00 $19,252.40 $32,455.40
,,,
Since the Center is owned by the Tustin Community Redevelopment Agency, the base rent will
be transferred to RDA-SC Project Area to partially offset development costs for the project. Rent
figure Will be adjusted annually based on the lesser of an increase in the Consumer Price Index
or four percent (4%).
The lessees' prorated Portion of the estimated reimbursable common area operating costs for the
facility, estimated at $39,220, is $19,252.40. This mount will be credited to the TFYC operating
budget in the General Fund. The remaining balance of the operating costs will be paid by the
City.
The following is a summary Of other important elements of the leases:
The term of the leases is for a period of five (5) years, with two, five (5) year extension
terms for CBSC, and one, five (5) year extension term for OCPT.
Though the space covered under these leases is proprietary, the City, as well as the
tenants, will have permission to use each other's areas for. approved supervised
programming when not in use.
OCPT (Headstart) is responsible for installing needed exterior tenant improvements to the
outdoor play area, which must be of a high quality, and are subject to City approval.
Both lessees are responsible for the first yeags annual rents to be paid in advance of
occupancy.
February 3, 1997
Page 3 .
Each lessee will be required to provide the appropriate faith performance bond or its
equivalent, as well as insurance for comprehensive liability, property coverage, workers'
compensation and builder's risk (in the mount indicated in the agreemenO. Each lessee-
is also responsible for indemnifying and holding the City and its employees harmless
against any claims, injuries or losses resulting from construction or tenant operations.
Staff will be available at the meeting to respond to any questions.
1VIlk[: I2Ienley ' Servic//~]s~
Director, Community
wp/ffyc/se./b:lea~rpt.wa h
chris~ Shingieton /0-- ""-
Assistant City l~lanager
SUMMARY REPORT
PREPARED PURSUANT TO SECTION 33433
OF THE CALIFORNIA COMMUNITY
REDEVELOPMENT LAW
Concerning .
PROPOSED LEASES BETWEEN
THE TUSTIN COMMUNITY REDEVELOPMENT AGENCY
and
ORANGE CHILDREN AND PARENTS TOGETHER, INC.
and
CHILDREN'S BUREAU OF SOUTHERN CALIFORNIA
TUSTIN COMMUNITY REDEVELOPMENT AGENCY
January, 1997
SUNIMARY REPORT
I. INTRODUCTION
This summary report has been prepared by the Tustin Community Redevelopment Agency, City
of Tusti~ California ("Agency") pursuant to' Section 33433 of the California Health and Safety
Code. This report sets forth certain details of the proposed two Lease Agreements ('Leases")
between the Agency and Orange Children and Parents Together, Inc. and Children's Bureau of
Southern California, ("Lessees"), respectively, for the lease of certain properties to the Lessees
benefiting the South Central Redevelopment Project Area ("Project"). The proposed Orange
Children and Parents Together, Inc. Lease and the proposed Children's Bureau of Southern
California Lease are available for review w/th the Tustin Community RedeveloPmem Agency.
This report also describes and specifies:
o
.
o
The cost of the proposed leases to the Agency including land acquisition costs,
rehabilitation costs, costs of other improvements tO be provided by the Agency;
The estimated value of the interests to be conveyed, detemined at the highest uses
permitted under Project Redevelopment Plan ("Plan");
The lease price to be paid by the Lessees, and an explanation of the reasons for the
difference between the lease values and the fair value of the interests to be conveyed,
determined at the highest uses consistent with the Plan;
4. The explanation of why the lease of the property will assist in the elimination ofbligt~t; and
5. How the proposed Leases comply with the Five-Year Implementation Plan for the South
Central Redevelopment Project Area.
mo
DESCRIPTION OF THE PROPOSED LEASES
The Site
The site is an approximately 22,500 square foot, generally rectangular piece of property at
the northeast comer of Newport Avenue and Sycamore Avenue in the City of Tusti~ immediately
adjacent to, and tangent with the South'Central Redevelopment Project Area. The site is
improved with an approximately 5,934 square foot building. Its previous use was as an
abandoned retail storefi'onts.
Page 1
B. Lease Area
1. Orange Children and Parents Together, Inc.
The Lease Area for the Orange Children and Parems Together, Inc. consists of an
approximately three thousand five hundred thirty-eight (3,538) square foot portion of the
building which exists on the property and an approximately 3, 895 square foot outdoor
playground on a portion of the property. The site plan for the property is included as
Attachment I. The lease area for Orange Children and Parents Together, Inc. is included
as Attachment II and m.
2. The Lease Area (Children's Bureau of Southern California.)
The Lease Area for the Children's Bureau of Southern California consists of an
approximately five hundred forty-three (.543) square foot portion of the building which
exists on the property. The lease area for Children's Bureau of Southern California is
specifically shown on Attachment
C. Lessee Responsibilities
1. Orange Children and Parents Together, Inc.
Under the proposed Lease Agreement, the Lessee shall
.a)
Lease the Lease Area from the Agency for a period of five years, with two
possible five-year extensions, only and exclusively for:
1) Licensed child care programs purposes; and/or
2) Operation of a licensed Headstart children's program; and/or
b)
c)
3) Such other purposesas are related to either of the above, provided
expressed written approval for such related activities is given by the
Agency.
Comply with a schedule of operations, to be submitted to and approved by
the Agency.
Bear the s°le expense for tenant improvements, approved by the Agency
pursuant to the Lease, necessary for the Lessee's operations
Page 2
d)
Pay to AgencY an annual lease rate of$11,450, payable monthly at one-
twelfth of the annual lease rate, to be adjusted annually pursuant to the
provisions of the lease.
e)
Pay to the Agency certain common area charges to be determined annually.
Charges at the on-set of the lease are estimated at $16,695.
Maintain premises in good, operable,, usable and sanitary order and in
good, safe and first-class condition, pursuant to the provisions of the Lease
Agreement.
g)
Operate and manage the Lease Area in a first class manner, comparable to
other first-class businesses providing similar services pursuant to the
provisions of the Lease Agreement.
2. Children's Bureau of Southern California
Under the proposed Lease Agreement, the LeSsee shall
a)
Lease the Lease Area from the Agency for a period of five years, with two
possible five-year extensions, only and exclusively for:
1) Licensed ch/Id care programs purposes; and/or
2) The provision of systems integration for the coordination oif
educational and social services programs; and/or
3) Such other purposes as are related to either of the above, provided
expressed written approval for such related activities is given by the
Agency.
b)
Comply with a schedule of operations, to be submitted to and approved by
the Agency.
c)
Bear the sole expense for tenant improvements, approved by the Agency
pursuant to the Lease, necessary for the Lessee's operations
d)
Pay to Agency an annual lease rate of $1,753, payable monthly at one-
tweltth of the annual lease rate, to be adjusted annually pursuant to the
provisions of the lease.
Page 3
e)
Pay to the Agency certain common area charges to be determined annually.
Charges at the on-set of the lease are estimated at $2,556.
Maintain premises in good, operable, usable and sanitary order and'in
good, safe and first-class condition, pursuant to the provisions of the Lease
Agreement.
g)
Operate and manage the Lease Area in a first class manner, comparable to
other first-class businesses providing similar services pursuant to the
provisions of the Lease Agreement.
D. Agency Responsibilities
Under the proposed Lease Agreement, the Agency shall
a)
Lease the Lease Area to the Lessees for a period of five years, with two
possible five-year extensions, at the annual base rent, as outlined in Section
C, above.
Cause the Common Areas to be maintained in good order, condition and
repair at its sole expense, subject to reimbursement by Lessee as provided
for in the Lease Agreement.
c)
Cause the exterior of all structures to be maintained and repaired, except
for the outdoor playground, which shall be maintained by Orange Children
and Parents Together, Inc. and also except to the extent Agency finds a
Lessee is responsible for damage to such structures.
'd)
Arrange for the furnishing of gas, electricity, water, sanitation, refuse
removal, janitorial and landscape maintenance to the Site and Lease Area,
as outlined in the Lease Agreement.
III. COST OF AGREEMENT T° THE AGENCY
The Agency has already expended funds for the acquisition and rehabilitation of the off-site
improvements for the Site. The Agency did not finance this acquisition and construction.,
Therefore no interest cost was incurred. No additional capital costs are anticipated.
The Agency will have no annual expenses. The City of Tustin General Fund will bear annual
operating and .maintenance expenses.
Page 4
Total cost of the project to the Agency is:
Acquisition of Site
Architectural/Engineering
Construction
Miscellaneous
$480,00O
60,000
531,000'
7,500
TOTAL COST $1,078,500*
* In addition, the City of Tustin has expended $I00,000 from its Community Development Block Grant
(CDBG) funds.
1. Agency and City Revenues
All Agency and City of Tustin General Fund revenues will come fi.om the lease payments made by
the lessees. These revenues are as follows:
a)
Orange Children and Parents Together, Inc.
FIRST YEAR REVENUES
Agency Rent
Common Area Charges to City (Estimated)
TOTAL FIRST YEAR INCOME
SECOND YEAR REVENUES
Agency Rent (4% Increase)
Common Area Charges to City (Estimated with 3% increase)
TOTAL SECOND YEAR INCOME
THIRD YEAR REVENUES
Agency Rent (4% Increase)
Common Area Charges to City (Estimated with 3% increase)
TOTAL THIRD YEAR INCOME
Fotra m v ma s
Agency Rent (4% Increase)
Common Area Charges to City (Estimated with 3% increase)
TOTAL FOURTH YEAR INCOME
FIFTH YEAR REVENUES
Agency Rent (4% Increase)
Common Area Charges to City (Estimated with 3% increase)
TOTAL FIFTH YEAR INCOME
$11,450
16,695
$28,145
$11,908
17,195
$29,103
$12,384
17,710
$30,094
$12,879
18,788
$31,120
$13;394
18~788
$32,182
Page 5
FIVE YEAR INCOME
Total Five Year Agency Rent
Total Five Year City Common Area Charges
TOTAL FIVE YEAR INCOME
$62,015
88,644
$150,644
b) Children's Bureau of Southern California
FIRST YEAR REVENUES
Agency Rent
Common Area Charges to City (Estimated with 3% increase)
TOTAL FIRST YEAR INCOME
$1,753
2,556
$4,309
SECOND YEAR REVENUES
Agency Rent (4% Increase)
Common Area Charges to City (Estimated with 3% increase)
TOTAL SECOND YEAR INCOME
$1,823
2,633
$4,456
THIRD YEAR REVENUES
Agency Rent (4% Increase)
Common Area Charges to City (Estimated with 3% increase)
TOTAL TmRD YEAR INCOME
$1,896
2,712
$4,608
FOURTH YEAR REVENUES
Agency Rent (4% Increase)
Common Area Charges to City (Estimated with 3% increase)
TOTAL FOURTH YEAR INCOME
$1,972
2,793
$4,765
FIFTH YEAR REVENUES
Agency Rent (4% Increase)
Common Area Charges to City (Estimated with 3% increase)
TOTAL FllZTH YEAR INCOME
$2,051
2,877
$4,928
FIVE YEAR INCOME
Total Five Year Agency Rent
Total Five Year City Common Area Charges
TOTAL FIVE YEAR INCOME
$9,495
23,066
$32,561
TOTAL FIVE YEAR INCOME FROM BOTH LEASES
Total Five Year Agency Income from Both Leases
Total Five Year City Common Charges from Both Leases
TOTAL AGENCY FIVE YEAR REVENUE
Page 6
$71,510
111,710
$183,220
2. Net Cost to the Agency
The following shows the Net Cost to the Agency for the Leases:
Total Agency Cost
Total Five Year Agency Revenues
NET AGENCY COST
$1,078,500
71,510
$1,006,990
ESTIMATED VALUE OF INTEREST TO BE LEASED: DETERMINED BY THE
HIGHEST AND BEST USE PERMITTED UNDER THE REDEVELOPMENT
PLAN.
The South Central Redevelopment Plan relies on the General Plan and the Zoning Code of the
City of Tustin to determine land use. The General Plan designates this site as
"Public/Institutional", which includes both public facilities, as the one being proposed, as well as
such private uses as hospitals and similar institutional uses. The Zoning Code designates this
parcel as C- 1, Retail Commercial, which was its use prior to being abandoned by its previous
owner.
For the purposes of this analysis, the highest and best private use for this site under the Plan is"
determined to be Retail Commercial, as allowed by the Zoning Code. If the site had remained in a
retail use, it would be a flee standing, small commerCial site, with a 5,934 square foot storefront.
It would be isolated by other uses on adjacent properties from the major commercial districts in
the immediate area.
The current lease rates for similar retail facilities in the City of Tustin ranges between $.95 per
square foot and $1.15 per square foot, triple net (NNN), with an annual cost of living escalator.
This analysis will use the high point of this range.
For the purposes of this report, the Leases will be evaluated and compared against a private
sector NNN Lease.
The following is the value of a five-year, private lease for 5,934 square feet of retail space, using
the 4% cost of living escalator estimated in the proposed Lease.
Year 1 $81,888
Year 2 85,164
Year 3 88,571
Year 4 92,114
Year 5 95,799
TOTAL FIVE YEAR LEASE VALUE 443,536
Page 7
V. PROPOSED LEASE VALUE AND REASONS FOR DIFFERENCE IN FAIR
MARKET VALUE FOR THE HIGHEST USE UNDER THE REDEVELOPMENT
PLAN
1. The Lessees shall lease the improvements on the site for 5 years. The total payments is
estimated to be $71,510.
2. The estimated lease value for the highest use for the improvements under the
Redevelopment Plan is $443,536.
3. The difference between the lease value and the fair market value is $372,026.
A component of the South.Central Redevelopment Plan established a goal of providing needed
public improvements and facilities which serve the Project Area. The South Central Project Area
is deficient in needed public recreational and social service facilities needed to serve the low to
moderate income residents of the project area.
Both Lessees are non-profit organizations, dependent primarily on public and private grants and
government assistance to provide their services to their clientele. Because of the nature of their
services, as well as the nature of their clientele, obtaining needed facilities at fair market value is a
financial burden for the Lessees. Because the Agency has determined the services the Lessees"
provide will assist the low to moderate income residents of the Project Area, it has set the
proposed lease rates at a level which will pay for the estimated value for the use of the site and
common area charges rather than setting the rate at the market value, based on private sector
standards. The cost of improvements are not considered in the Lease terms set for each Lessee.
Even though these costs off improvements are not included, the Agency will be receiving a rent
payment which takes into account the full acquisition costs of the site.
The Agency has determined that, in order to obtain these needed services in the South Central
Project Area, the lease rates must be reduced from fair market rates to meet the needs of the
service providers, rather than produce market rate revenues to the Agency. The Agency has
therefore, determined that, based on this critem, the lease rates are fair and reasonable.
VII. EXPLANATION OF WHY THE PROPOSED LEASE WILL ELIMINATE
BLIGHT
In determining whether to acquire and irnprove this property with the intent of leasing it to
providers of needed services for the low to moderate income residents of the Project Area, the
Agency relied on the following information:
Page 8
1. The site is at a major intersection in the South Central Project Area and at a freeway
entrance into the community.
2. The use of the existing building on the site had been abandoned several years ago and
the building was boarded.
3. The on-site improvements, consisting primarily of a parking lot and attendant
landscaping, were not being maintained.
4. Debris and trash regularly collect, and was dumped, on the site.
5. The site was being used by transients and others for illegal purposes.
6. Because of its lack of use, the building was falling into deterioration.
7. The previous owner had filed bankruptcy and was financially unable to repair the
building and site and place it back into productive use.
By its acquisition of the property and subsequent rehabilitation, these blighting influences have
been eliminated on this site. Further, by its use by the Lessees, the site and the site improvements
will be maintained in a non-blighted state and will serve the recreational needs of the low-to- '~
moderate income community in the Project Area.
VIIIi CONFORMANCE WITH THE IMPLEMENTATION PI.AN FOR THE SOUTH
CENTRAL PROJECT AREA
One of the goals set in the five-year Implementation Plan for the South Central Redevelopment
Project Area is "Upgrade substandard public infrastructure and public facilities, and provide for
the installation and construction of new public improvements to meet the requirements of existing
and new development in the Project Area." The acquisition, rehabilitation and the propsoed
Leases meets this goal.
The Agency also specifically proposed in the Implementation Plan the expenditure of $2,000,000
for recreational facilities to provide recreational facilities for elementary and middle school age
children, young adults and/or families. The acquisition and rehabilitation of this site and the
proposed Leases are a direct implementation of this program
Page 9
ATTACHMENT
SITE PLAN
ATTACHMENT I
i
ATTACHMENT II
BUILDING LEASE AREA
ORANGE CHILDREN AND PARENTS TOGETHER, INC.
ATTACHMENT 11
LEASE AREA
.- .
o
ATTACHMENT III
PLAYGROUND LEASE AREA
ORANGE CHILDREN AND PARENTS TOGETHER, INC.
ATTACHMENT II'I
LEASE AREA
·
I
DJ
ATTACHMENT IV
LEASE AREA
CHILDREN'S BUREAU OF SOUTHERN CALIFORNIA
ATTACHMENT IV
LEASE AREA
LEASE AGREEMENT BETWEEN
THE TUSTIN COMMUNITY REDEVELOPMENT AGENCY AND
ORANGE CHILDREN AND PARENTS TOGETHER, INC.
This Lease is made and entered into on this day of. , 1997, by and
between the Tustin Community Redevelopment Agency, a municipal, corporation, hereinafter
referred to as "Agency", and Orange Children and Parents Together, Inc. (OCPT), a California
nonprofit public benefit corporation, hereinafter referred to as "Lessee."
RECITALS
A. Agency is the owner of the Tustin Family and Youth Center (the "Property"),
located, at 14722 Newport Avenue, Tustin, California, and depicted on Exhibit "A" attached
hereto and incorporated herein by this reference; and
B. Agency is authorized by the provision of Government Code Section 37396 to lease
Agency property for the provision of services consistent with public park, recreation, and
community services purposes; and
C. Lessee desires to lease-tenant space from Agency at the Property for the purpose
of operating a licensed Headstart and child care program; and.
D. Agency desires to lease tenant space to Lessee at the Tustin Family and Youth
Center for such purposes in accordance with the terms and conditions set forth in this Lease.
NOW, THEREFORE, in consideration of the mutual covenants, promises and conditions
set forth herein, the parties hereto agree as follows:
AGREEMENT
1.0 Premises.
1.1 The Premises which are the subject of this Lease consist of an approximate three
thousand five hundred thirty-eight (3,538) square foot interior portion of the Property and a three
thousand eight hundred ninety-five (3,895) square foot exterior portion of the Property. The site
plan for the Property is shown in Exhibit "B", attached hereto and incorporated herein by this
reference. The Premises being leased hereunder, are specifically demarcated on Exhibits "C" and
"D", attached hereto and incorporated herein by this reference.
1.2 Agency hereby leases to OCPT and OCPT hereby leases from Agency, the
Premises, upon the terms and conditions set forth in this lease.
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TUSTIN COMMUNITY-REDEVELOPMENT AGENCY AND
ORANGE CHILDREN AND PARENTS TOGETHER, INC.
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1.3 Lessee has inspected and accepts Premises in their present condition and makes
no demand on 'Agency for any improvements or alteration thereof.
1.4 The title to Premises and any improvements thereon, present or future, shall remain
in Agency or Agency's successor or assignee. Lessee agrees never to assail, 'contest or resist said
title.
2.0 Term and Commencement.
2.1 The term of this Lease shall be for a period of five (5) years commencing on the
first day of the calendar month following the issuance of a "Notice to Occupy Premises" by the
Agency.
..
2.2 Lessee may apply for an extension of the term of this Lease for one successive
term of .five (5) years each; provided that the Lease has not been terminated, and no later than
sixty (60) days prior to the expiration date of the Original term of this Lease, Agency receives
a written request therefor, signed by Lessee.
2.2.1 Agency shall have the exclusive discretion and right, as a condition" of
approving said extension, to renegotiate the terms of this Lease, including, but not
limited to, base rents, common area charges, and required tenant improvements.
Said negotiation shall consider economic factors such as rent paid by similar
Headstart or other licensed child care operations in the Southern California area.
2.2.2 Lessee's option to extend this Lease may be denied by Agency based on
any of the following factors:
(1).. Lessee is in default of the terms of this Lease;
(2). Lessee has not received satisfactory performance evaluations
from Agency as set forth in Paragraph 9 of this Lease; or
(3). Any of Lessee's licenses to operate a Headstart or child
care programs have been terminated or revoked.
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2.3 Possession of the Premises, including all structures, buildings and/or improvements
thereon, shall be surrendered by Lessee to Agency immediately upon termination of this Lease.
2.4 In the event Lessee holds over beyond the term herein provided with the express
or implied consent of Agency, such holding over shall be on a month-to-month basis, subject to
all the terms and conditions of this Lease, and at the monthly compensation provided herein.
Such holding over shall not be construed as'a renewal of this Lease.
2.5 This Lease may be terminated prior to the expiration'of its term by mutual written
agreement of the parties or as provided in Paragraph 21.
3.0 Permitted Uses and Hours of Operation of Premises.
3.1 The Premises shall be used onlY and exclusively for the following and/or licensed
child care program purposes:
3.1.1 Operation of a licensed Headstart children's program.
3.1.2 Such other purposes as are related to either of the above, provided express
written approval for such "related purposes" is given by Agency.
3.2
prohibited.
Use of the Premises for human habitation or any other purpose whatsoever is
3.3 Lessee shall submit to Agency for approval, a proposed schedUle setting forth
hours and days of operation for the business. The proposed schedule shall be submitted within
ten (10) days after Agency issues a "Notice to Occupy Premises". Lessee shall comply with the
schedule approved by Agency unless prior written authorization to deviate from the schedule has
been obtained from Agency.
4.0 Tenant Improvements.
4.1 Lessee may construct upon the Premises, at Lessee's sole expense, such additions
or alterations as are necessary for Tenant's operations, (collectively the "Improvements") in
accordance with the provisions set .forth in this Section 4.
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4.2 Lessee shall prepare a written Improvement Plan, which shall describe the
proposed improvements, iheir estimated costs, and projected time frame for commencement and
completion of the Improvements. The Improvements shall comply with applicable City codes
and the requirements of state law.
4.3 Prior to the commencement of construction of the Improvements, Lessee shall do
all of the following:
4.3.1 Obtain Agency's written approval of all plans, specifications and time
frame for completion; and
4.3.2 Obtain all applicable permits and licenses; and
4.3.3 Comply with any terms and conditions as may be imposed on it by Agency
regarding such Improvements.
4.4 No modification of approved plans, specifications, or time frame shall be made
by Lessee without prior written approval by Agency.
4.4.1 Any delay in construction of the Improvements due to fire, earthquake,
war, labor dispute or other events without the fault and beyond the control of
Lessee shall extend the time frame in which said construction must be completed
by the length of such delay.
4.5 Lessee shall permit the Agency to inspect the Premises during construCtion of the
Improvements.
4.6 Lessee may undertake additional Improvements to the Premises subject to the
requirements of this Paragraph 4.
4.7 Ownership of the Premises and all Improvements, additions, alterations or changes
constructed upon Premises shall immediately vest and remain'vested in Agency, without
compensation being paid therefor by Agency.
4.8 Lessee shall COnstruct, perform, complete and maintain all Improvements in a good
and workmanlike manner and with high quality materials, and shall furnish all tools, equipment,
labor and material necessary to perform and to complete same.
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4.9 Agency has the right to require,' during any period of construction of
Improvements, that Lessee provide a performance and/or payment bond in an amount of not less
than one hundred percent (100%) of the costs for the construction to be performed, as detailed
in the Improvement Program, payable to the City of Tustin and executed by a surety admitted
in the State of California.
4.10
following:
4.9.1 Said bond(s) shall be maintained in full force and effect by Lessee until
Improvements have been completed and accepted by the Agency.
4.9.2 If Lessee completes the required Improvements in accordance with the
Improvement Program, then surety shall no longer be bound.
4.9.3 Lessee may elect, in lieu of said bonds, to deposit with Agency cash or
United States Government securities in all respects .satisfactory to Agency's
attorney. Said cash or Securities shall be deemed deposited with Agency to secure
full and satisfactory performance of the principal obligations heretofore described
for which surety may be required, and shall be released upon satisfactory
performance thereof, as evidenced by written acceptance by Agency and lhe
unconditional release of mechanics liens by all claimants. In lieu thereof, Lessee
may deposit the required amount in a bank or other financial institution whose
deposits are federally insured, provided the account is made payable to Agency
on demand and the Certificates of Deposit are deliq, ered to Agency. Lessee shall
be.entitled to all interest on the deposit and to the return of the Certificate of
Deposit upon satisfactory performance as heretofore defined.
Upon completion of Improvements, Lessee shall furnish Agency with ail of the
4.10.1 One (1) complete set of as-built construction drawings on MYlar or its
equivalent, including all circuit breakers, mechanical equipment, switches,
plumbing and fire sprinkler section and main valves Plainly labeled with a master
index of same;
4.10.2 Operating manuals for buildi'ng equipment and systems;
4.10.3 Copies of all written warranties.
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4.11 Upon completion of Improvements in a manner satisfactory to Agency, Agency
shall provide Lessee with written acceptance of Improvements.
4.12 Upon termination of this Lease, Lessee shall assign to Agency all eXpress
warranties furnished by other persons in connection with the construction and installation of the
Improvements.
4.13 Upon written request of Agency, Lessee shall obtain such insurance coverage as
Agency deems reasonably necessary for said Improvement Program.
5.0 .Rent.
5.1 Lessee shall pay to Agency a minimum annual rent of_$11.450 ("Base-Rent".)
Rent for the first year of the lease will be prepaid. Subsequent annual rent totalling one-twelfth
(1/12) of the Base Rent shall be payable monthly, in advance, on the first, day of each month.
5.2 After the expiration of the first full year of the initial term of this Lease and each
year thereafter on the anniversary of the Leas~ commencement date, Agency shall notify Lessee
of any adjustment in the Base Rent.'
5.2.1 The adjusted Base Rent shall be calculated as follows:
Base Rent for the prior full year multiplied by the lesser of
(a) The increase in the Consumer Price Index for All
Urban Consumers, Ail Items, (base year 1982-1984 equals
100) for the Los Angeles/Anaheim/Riverside geographical
area, as compiled by the United States Department of Labor
for the immediately preceding year;, or
(b) Four percent (4%).
5.2.2 If said-Consumer Price Index ceases to exist, the parties shall substitute
any official index Published by the Bureau of Labor Statistics, or successor or
similar governmental agency, as may then be in existence and shall be most nearly
equivalent thereto. If any such rental adjustment cannot be computed as of a rent
adjustment date, Lessee shall continue to pay the Base Rent theretofore payable
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until such rental adjustment can be computed, at which time an appropriate
adjustment shall be made.
5.3 Rent shall be payable at the office of the Agency's Executive Director at 300
Centennial Way, Tustin, California 92780, or at such other place or places as Agency from time
to time may designate by written notice to Lessee delivered on or before the 15th day of the
month, to be effective with the next month's payment.
5.4 Rent and other sums due Agency under this Lease Shall be due as specified in this
Lease and shall bear interest at the rate of seven percent (7%) per annum until paid, if not paid
within ten (10) calendar days after the date on which the payment is due. In no event, however,
shall any such interest charges exceed the maximum amount permitted by law. Any returned
checks will be assessed the maximum fee for returned checks permitted by state law. In addition,
the interest charge shall be added to the returned check charge unless the replacement payment
is made within ten (10) calendar days of the date on which payment was due.
6.0 Common Areas.
6.1 The common areas of the Property (collectively "Common Areas") shall consist
of the parking areas, walkways, driveways, landscaped.areas, reception area, lounge, corridors,
public restrooms, work area, custodian room, and all other areas except the Premises and other
leased areas of the building. Common Areas are specifically demarcated on Exhibit "E".
6.2 Common Areas shall be for the joint use of all tenants, their licensees; customers,
invitees, suppliers, employees and volunteers. Agency hereby grants to Lessee the nonexclusive
right to use Common Areas.
6.3 Agency shall keep and maintain Common Areas in good order, condition and
repair, at Agency's sole expense, subject to reimbursement by Lessee of its prorata share thereof
as provided in Paragraph 6.5, below.
6.4 Agency shall retain sole and exclusive control of Common Areas and shall have
the right to do the following:
6.4.1 Establish and enforce reasonable rules and regulations applicable to all
lessees concerning the maintenance, management, use, and operation of Common
Areas;
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6.4.2 TempOrarily close any Common Areas to perform maintenance or to
prevent a dedication of any Common Areas or the accrual of any rights of any
person or of the public in Common Areas;
6.4.3 Determine the natUre and extent of Common Areas and make such changes
thereto as Agency deems desirable;
6.4.4 Select an independent operator to maintain and operate any Common Areas~
if, at any. time, Agency determines that the best interests of the lessees will be
served by doing so. Agency shall have the right to negotiate and enter into a
contract with such operator on such terms and conditions and for guch period of
time as Agency 'deems reasonable and proper, both as to service and as to cost.
6.5 Lessee shall pay to Agency, as additional rent, Lessee's prorata share of the
expenses incurred by Agency for maintenance and operation of certain Common Areas, including,
without limitation, the cost of the following: cleaning; sweeping; utilities; security systems;
janitorial services; interior and exterior lighting; signage; insurance premiums on Premises;
insurance premiums on Common Areas and other areas of the Property; fire detectors and
sprinkler systems; real property taxes and assessments; and an administrative fee equal to i'en
percent (10%) of the total of such costs.
6.5.1 Lessee's prorata share shall be that fractional part of the total of such costs
which the square footage of Premises bears to the total square footage of gross
leasable space on the Property, as determined by Agency.'
6.5.2 Agency and Lessee agree that Lessee's prorata share' upon commencement
of the Lease is 59.63% of the 5,934 square foot building. This prorata share shall
be adjusted from time to time based on changes in the Lessee's square footage of
leased Premises and changes in the leasable square footage of the Property.
6.6
Lessee's prorata share of Common Area costs shall be payable as follows:
6.6.1 From and after the commencement date of this Lease, but subject to
adjustment as provided below in Paragraph 6.6.2, Lessee shall pay to Agency on
or before the first (lst) day of each calendar month during the term of the Lease,
the amount billed to Lessee, which amount shall be a reasonable estimate of
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7.0
Common Area costs. Estimated Common Area charges for the 'first year of the
lease shall be prepaid.
6.6.2 Within a reasonable time following the end of each calendar year during
the term of this Lease, Agency shall furnish Lessee a statement covering the prior
calendar year showing the actual expenses incurred in connection with Common
Areas, the actual amount of Lessee's prorata share thereof, and the payments made
by Lessee. Lessee shall promptly pay. its prorata share of such expenses which
exceeds its payments for that prior calendar year within 30 days of billing, or, if
Lessee's payments exceeded its prorata share of such expenses, Agency shall
promptly refund the excess.
Maintenance of Premises.
7.1 Lessee shall, at its sole cost and expense during the term of this Lease, keep and
maintain the Premises and all Improvements, fixtures, and equipment thereon, in good, operable,
usable and' sanitary order and repair, and in a good, safe and first-class condition, providing for
such repairs, replacements, rebuilding and restoration as may be required by Agency to comply
with the requirements of this Lease.
7.1.1 Lessee, shall furnish all necessary equipment, supplies and material of
good quality and insufficient quantity to fulfill the requirements of this Lease and
to maintain .an acceptable and professional level of maintenance.
7.1.2 Any repairs, replacements, rebuilding, restoration and/or any modifications
or additions to Premises shall have the prior written approval of Agency.
7.2 Lessee shall keep Premises free and clear of rubbish and litter and shall deposit
rubbish and litter in designated trash containers. No offensive matter or refuse or substance
constituting an unnecessary, unreasonable, or unlawful fire hazard, or material detrimental to the
public health shall be permitted to remain on Premises and Lessee shall prevent any accumulation
thereof from occurring. The charge for rubbish removal shall be included in Common Area
costs.
7.3 Should Lessee fail, after ten (10) days notice from Agency o~' the need thereof, to
perform its obligations required under this Paragraph 7, Agency, in addition to all other available
remedies may exercise its right of entry as provided in Paragraph 20.
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7.4 All work performed under this Paragraph 7 shall be performed in accordance with
the highest industry-wide standards at a frequency sufficient to maintain the aesthetic level and -
proper condition of Premises.
7.5 Agency has the right to conduct regularly scheduled maintenance inspections of
Premises. A written report of such inspection shall be recorded, retained for reference, and
forwarded to Lessee upon request.
7.6 Lessee shall provide Agency with the names and telephone numbers of at least two
(2) qualified persons who can be contacted by Agency representatives when emergency
maintenance conditions occur during the hours when Lessee's normal work force is not present.
.Agency shall call for such assistance only in the event of a genuine'and substantial emergency.
7.7 Agency shall be responsible for the maintenance and repair of the exterior of all
structures on the Property, except to the extent Agency finds Lessee is responsible for damage
to such structures or as otherwise provided in this Lease. In those cases, Agency shall have the
option of either requiring Lessee to repair the damage, or repairing the damage itself and
charging Lessee for the cost of such repair, in which case, Lessee shall prOmptly reimburse
Agency for such costs. "
8.0 Operatin~ ResPOnsibilities.
8.1 Lessee shall operate and manage Premises in a first-class manner, comparable to
other first-class businesses providing similar services.
8.2 Lessee shall conform to and abide by all applicable CitY and County Ordinances
and all state and Federal laws and regulations;, shall conform to and abide by all applicable rules
and regulations of Agency; and shall obtain all required permits and licenses necessary for the
operation of its business.
8.3 Lessee shall exercise every reasonable effort to prevent loud, boisterous or
disorderly persons from loitering about Premises.
8.4
Premises.
Lessee shall not knowingly permit any illegal activities to be conducted upon
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8.5 Lessee may, at its own expense, place signs upon Premises or Improvements
subject to the prior written approval of Agency. The placement of such signs shall comply with
Tustin City Code Sections 8600 et seq. and 9400 et seq. All signage placed upon the Premises
or Improvements by Lessee shall remain the property of Lessee and shall be removed by Lessee
upon termination or expiration of this Lease at Lessee's expense. Any damage caused by such
removal shall be repaired at Lessee's expense.
8.6 Lessee shall maintain an adequate and proper staff. Agency may at any time give
Lessee written notice of noncompliance with this Paragraph 8. Lessee shall take all reasonable
measures to ensure that the conduct and activities of Lessee's employees Shall not be detrimental
to the interest of the public patronizing Property.
8.6.1 Lessee shall establish an identification system for its staff, which-clearly
indicates to patrons the names of staff on duty. The identification system may
include appropriate attire, name badges and/or name plates.
8.6.2 Lessee shall comply with all laws regarding the employment of aliens and
others and ensure that all its employees meet the citizenship or alien sta.t, us
requirements required by Federal and State statutes and regulations. Lessee shall
obtain from all employees the documentation of employment eligibility status
required by Federal and State statutes and regulations as they currently exist and
as they may be hereafter amended. Lessee shall retain such documentation for all
employees for the period prescribed by law.
· 8.6.3 Lessee shall indemnify, defend, and hold harmless,. Agency, its officers and
employees from employer sanctions and any other liability which may be assessed
against Lessee or Agency or both in connection with any 'alleged violation of
Federal and/or State statutes or regulations pertaining to the eligibility for
employment of persons performing services under this Lease.
8.7 Agency shall arrange for the ~furnishing of gas, electricity, water, sanitation, refuse
removal, and janitorial and landScape maintenance to the Premises. -Lessee's share 'of gas,
electricity, water, sanitation and janitorial costs shall be considered as additional rent. Lessee
shall make its own arrangements for and pay for telephone and cable television.
8.7.1 Lessee waives any .and all claims against Agency for loss or damage
caused by a defect, deficiency or impairment of any utility system, water system,
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drainage system, waste system, heating system, gas system, electrical apparatus
or wires serving Premises.
8.7.2 Lessee shall keep the PremiSes free and Clear of rubbish and litter and shall
deposit rubbish and litter in designated trash containers.
8.8 Lessee may provide any legal devices, mechanisms or equipment designed for the
purpose of protecting Premises from theft, burglary or vandalism, provided prior written approval
for installation thereof is obtained from Agency. All such purchases and installation shall be at
Lessee's sole expense.
8.8.1 Upon Agency's request, during the last thirty.(30) days preceding the
expiration or termination of this Lease, Lessee shall remove same from Premises,
except for those items which have been so affixed that their removal cannot be
accomplished without damage to Premises.
8.9 Lessee, at its sole cost and expense, shall provide and install any appliances,
furniture, fixtures, equipment, padlocks, or personal property required for the operation of
Premises. '
8.9.1 During the last thirty (30) days preceding the. expiration or termination of
this lease, Lessee shall remove same from Premises, except for those items which
have been so affixed that their removal cannot be accomplished without damage
to Premises.
8.9.2 Should Lessee fail to remove same within the required thirty (30) day
period, Lessee shall lose all right, title and interest therein, and Agency maY elect
to keep same upon Premises or to sell, remove' or demolish same.
8.9.3 Lessee shall reimburse Agency for' any cost incurred in the removal or
demolition thereof, in excess of any consideration received from any sale.
8.10 Lessee shall immediately correct any unsafe condition of Premises, as well as any
unsafe practices occurring thereon. Lessee shall obtain 'emergency medical care for any employee
or patron who is in need thereof. Lessee shall cooperate fully with Agency in the investigation
of any injury or death occurring on Premises, including a prompt report thereof to Agency.
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8.11 Lessee shall not use or.permit the use of Premises in any manner which creates
a nuisance, or a measurable annoyance to persons outside Premises, including, without limitation,
live, recorded or broadcast entertainment or the use of loud speakers or sound or light apparatus
other than as may be required by law or be necessary or advisable for safety purposes.
8.12 Lessee agrees to allow inspection of Premises, at reasonable times, by Agency,
County officials, fire officials, and State officials.
9.0 Performance Evaluation.
9.1 Lessee or its designee shall meet with the Agency's Executive Director at such
times as may be requested by Agency to review Lessees' performance under this Lease:and to
discuss any problems or other matters as determined by Agency. Agency shall provide Lessee
with a written performance evaluation pursuant to this meeting.
10.0 Advertising: and Promotional Materials.
Lessee shall not promulgate nor cause to be distributed any advertising or promotio~ial
materials without the prior written approval of Agency, That approval shall not be unreasonably
withheld or delayed and shall be deemed to be given if no objection is made within fifteen (15)
business days following a written request for approval submitted by Lessee. Such materials
include, but are not limited to: advertising in newspapers, magazines and trade journals, and radio
and/or television commercials.
11.0 Destruction of Premises.
11.1 In the event Premises shall be totally or partially destroyed by a risk .covered by
insurance required by this Lease, Agency shall make the lost adjustment with the insurance
company insuring the loss and receive payment of the proceeds of insurance.
11.2 Lessee shall either opt to restore the Premises or terminate this Lease.
11.2.1 In the event Lessee chooses to restore the Premises, said' insurance
proceeds, if any, shall be held by Agency for the benefit of Lessee and shall be
disbursed in installments as construction progresses for payment of the costs of
restoration, upon satisfactory performance of the Work required, as evidenced by
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certification of completion issued to Lessee by Agency, and release Of mechanics
liens by all persons furnishing labor and materials thereon.
11.2.2 If the insurance proceeds are insufficient to pay the actual costs of
restoration, Lessee shall deposit the amount of the deficiency with Agency upon
demand therefor by Agency, and said sums shall be held for payment .of said costs
and disbursed in the manner heretofore provided.
11.2.3. Any undistributed funds shall be retained by Agency and credited to the
rent due over the remaining term of this Lease.
11.3 If Lessee elects to restore the Premises, written plans, specifications, and
construction cost estimates for the. restoration shall be prepared by Lessee and forwm:ded to
Agency for approval prior to the performance of any work. Said documents shall be prepared
and submitted in a timely manner following adjustment of the loss and.receipt of the proceeds
of insurance by Agency.
11.3.1 The required construction shall be performed by Lessee and/or licensed
and bonded contractor(s), who shall be required to carry comprehensive liabili'ty
and property damage insurance, workers compensation insurance, and standard fire
and .extended coverage insurance, with vandalism and malicious mischief
endorsements, during the period of construction, in amounts equal to the insurance
limits required herein, or as otherwise determined by Agency.
11.3.2 Said construction shall be commenced promptly following approval by
Agency, the issuance of applicable permits and posting of the construction site by
Agency with notice of non-responsibility, and shall be diligently prosecuted to
completion.
11.3.3 All work shall be performed in accordance with the approved plans and
specifications, unless changes are approved in writing, in advance, by Agency.
· 11.3.4 Lessee agrees that Agency may have on the site at any time during the
construction period, an inspector who shall have the right to access Premises and
the work occurring thereon.
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11.3.5 Lessee, at the commencement of the construction work, shall notify
Agency in writing of the identity, place of business, and telephone number of
responsible person(s) in charge of the construction.
11.3.6 All construction shall be performed in a good and workmanlike manner.
Upon completion of the restoration, Lessee shall immediately record a notice of
completion with the Orange County Recorder.
.11.4 In the event Premises shall be totally or partially destroyed by a risk for which
insurance coverage is not required or provided herein, Agency shall either restore the Premises
or terminate this Lease.
12.0 Reconstruction by Agency Affectin~ Premises.
12.1 In the event Agency is required to partially or fully reconstruct or cause to be
constructed a new facility because of destruction of the Premises as described in Section 11.4,
this Lease shall continue in full force and effect, except that the payments to be made by Lessee
shall be abated and/or other relief afforded to the extent that Agency may determine t. he
reconstruction interferes with Lessee's authorized operations, and provided a claim therefor is
filed with Agency within one hundred (100) days of the commencement of reconstruction.
12.2 Lessee shall cooperate with Agency by vacating Premises and removing all items
of inventory, trade fixtures, equipment and furnishings for such periods as are required by the
reconstruction or renovation. Lessee further agrees to cooperate in the determination of the
abatement and/or other relief to provided by furnishing all information requested relative to its
operations and permitting examination and audit of all accounting records kept in connection with
its operations.
12.3 Following completion of the new or renovated facility, Lessee shall resume its
operations within thirty (30) days of written notice from Agency that premises are available for
occupancy.
12.4 This Paragraph 12 shall also be applicable in the event of performance of work
on Premises that requires a partial or total closure thereof, except that the abatement and/or other
relief to be provided shall be based upon the extent Agency may determine that the reduction in
the public's use of Premises, due to the partia! or total closure .thereof, has affected Lessee's
operations.
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12.5 Lessee agrees to accept the remedy herein provided in the event of construction
upon Premises, and hereby waives any and all additional rights and remedies for relief or
compensation that are presently available or may hereafter be made available under the laws and
statutes of this State.
13.0 Lessor-Lessee Relationship.
13.1 This Lease is not intended and shall not be construed to create the relationship of
agent, servant, employee, or representative of the Agency by Lessee.
13.2 Lessee understands and agrees that all persons furnishing services to Lessee
pursuant to this Lease are, for purposes of workers compensation and liability, solely employees
of Lessee and not of Agency.
-.
13.3 Lessee shall bear the sole responsibility and liability for furnishing workers
compensation benefits to any person for injuries from or connected with services performed on
behalf of Lessee pursuant to this Lease.
13.4 Lessee understands and specifically agrees to inform its employees that Lesse[ is
a tenant of Agency. Lessee understands and specifically agrees to inform its employees that
Lessee is not an agent, servant, employee or representative of Agency.
13.5 Lessee understands and specifically agrees to inform its employees that they are
not agents, servants, employees, or representatives of Agency.
14.0 Defense, Indemnification and Hold Harmless.
14.1 Lessee shall defend, indemnify, and hold harmless Agency and all of its officers,
emplOyees, agents and independent contractors thereof from any claims, suits, or actions of every
kind and description, brought for, or on the account of, injuries to or death of any person
including, but not limited to, workers and the public, or damage to Agency's property arising out
of or in connection with Lessee's activities on Premises, its failure to keep Premises in good
condition and repair, or any other action by Lessee taken in connection with or in performance
of this Lease, or by or on account of any act or omission by Lessee's employees, agents,
representatives, subcontractors, or third parties in connection with Lessee's obligations under this '
Lease.
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14.2 Lessee's defense and indemnification, of Agency. shall include all costs and
expenditures, .including reasonable attorney's fees incurred by Agency or its employees, officers,
agents or independent contractors, with respect' to such claim or suit.
15.0 Insurance.
15.1 Lessee shall provide and maintain at its own expense during the term of this Lease
the following insurance covering its operations under this Lease. Such insurance shall be
provided with insurers licensed to do business in the State of California, with a rating .of at least
A; VII, according to the latest Best's KeY Rating Guide. Evidence of such insurance shall be
delivered to Agency on or before the effective date of this Lease on Agency's own form. The
Certificate of Insurance shall specifically identify this Lease and shall contain express conditions
that Agency is to be given at least thirty (30) days advance written notice, of any material
modification in or termination of insurance. Such insurance, shall be primary to and not
contribUting with any other insurance maintained by 'Agency, and shall name the Agency, the
City of Tustin, and their officers and employees as additional insureds. Ail insurance shall be
on an occurrence basis.
15.1.1 General Liability Insurance:
Comprehensive general.liability insurance covering Premises, operations, products
and completed operations, contractual, broad form property damage, and personal
injury, with a combined single limit of not less than one million dollars
($1,000,000) per occurrence.
15.1.2 Automobile Liability Insurance:
Automobile liability insurance covering owned and non-owned vehicles with a
combined single limit of not less than three hundred thousand dollars ($300,000)
per occurrence.
15.1.3 Workers Compensation Insurance:
Workers compensation insurance in an amount and form meeting all applicable
requirementS of the California Labor Code, covering all persons providing services
by or on behalf of Lessee and all risks to such persons.
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15.1.4 Property Insurance:
Real property - all. risk insurance, including flood damage, for the full insurable
replacement value with a deductible of no greater than 5%, for all risk-related
coverage; and personal property insurance for the actual cash value against the
hazards of fire, theft, burglary, vandalism and malicious mischief.
15.2 During the period of construction of tenant improvements, the following additional
insurance may be required at Agency's discretion, on the same terms and conditions as listed in
Paragraph 15.1:
15.2.1 Builders All Risk Insurance:
..
Builders all-risk insurance, including flood damage, covering 'the entire
Improvement Program against loss or damage until completion and acceptance by
Agency, in an amount covering the full replacement value of Improvements with
a deductible not exceeding 5% of the construction cost.
..
15.3 Failure by Lessee to procure or maintain required insurance shall constitute an
Event 6f Default, upon which Agency may immediately terminate this Lease. Lessee's operations
shall be subject to suspension by Agency during any period Lessee fails to maintain required
insurance in full force and effect.
15.4 Conduct of Lessee's operations shall not commence until Lessee has complied with
the aforementioned insurance requirements.
15.5 The specific level of liability insurance required herein is subject to renegotiation
on an annual basis. Should either party request renegotiation with respect to the insurance to be
provided, the determination thereof shall be established through mutual negotiations between the
parties. Should no written agreement be reached by the parties, Lessee shall continue to provide
insurance at the level and in the manner heretofore provided.
16.0 Taxes and Assessments.
16.1 Should the property interest conveyed by this Lease be subject to real property
taxation and/or assessments, Lessee shall pay, before delinquency, all lawful taxes, assessments,
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fees or charges which may be levied by the State, County, Agency, or any other tax or
assessment-levying body upon Premises and any Improvements located thereon.
16.2 Lessee shall pay, before delinquency, all taxes, assessments, fees and charges on
personal property, goods, merchandise, fixtures, appliances and equipment owned or used on
Premises.
17.0 ..Assignment, Sublease and Encumbrance.
17.1 The parties acknowledge that Agency is entering into this Lease in reliance upon
the expertise and abilities of Lessee and its principals. Consequently, Lessee shall not voluntarily
assign or encumber its interest in the Lease or in Premises, or sublease or license the use of any
part of Premises, or allow any other person or entity, except Lessee's authorized representatives,
to occupy or use any part of Premises without the prior written consent of Agency.
17.2 Lessee shall not, without the prior written consent of Agency, assign, hypothecate
or mortgage this. Lease, or sublease or license the use of any part of Premises. Any attempted
assignment, hypothecation, mortgage, sublease or license without the prior written consent of
Agency shall render this Lease null and void.
17.3 Any action to transfer this Lease or any interest herein in proceedings Of
attachment or execution against Lessee, or in voluntary or involuntary proceedings in bankruptcy
or insolvency Or receivership taken by or against Lessee, or by any process of law including
proceedings under all applicable Federal bankruptcy laws, shall render this Lease null and void.
17.4 Agency may assign any or all of its interest in this Lease at any time.
17.5 Each and-all of the provisions, agreements, terms, covenants and conditions
contained in this Lease shall be binding upon any transferee hereof or of any interest herein.
18.0 Nondiscrimination.
18.1 Lessee hereby certifies and agrees that, in all matters affecting this Lease, it shall
comply with applicable Federal and State laws and regulations prohibiting discrimination.
18.2 Lessee hereby certifies and agrees that all persons employed by it are, and shall
be, treated equally without regard to race, creed, color, national origin, POlitical affiliation, marital
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status, sex, age, or handicap, and in compliance with all Federal and State laws prohibiting
discrimination and employment, including, but not limited to, the Federal Civil Rights Act of
1964, the Unruh Civil Rights Act, and the Americans with .Disabilities Act.
18.3 Lessee certifies and agrees that subcontractors, bidders and vendors are and shall
be selected without regard to any characteristic heretofore described.
18.4 Lessee's employment records, shall be open for inspection by Agency at any
reasonable time during the term of this Lease for the purpose of verifying the practice of
nondiscrimination by Lessee in the areas heretofore described.
18.5 Any violation of the above provisions shall constitute an Event of Default as
described in Paragraph 19. Agency reserves the right to independently determine the existence
of such violations. In addition, a determination by the California Fair Employment and Housing
Department or the Federal Equal Employment Opportunity Commission or other applicable State
or Federal civil rights enforcement agency that Lessee has violated the nondiscrimination
provisions of this Lease, shall constitute an Event of Default.
18.6 Lessee shall include nondiscrimination and compliance provisions in ~11
subcontracts to perform work under, this Lease.
19.0 Events of Default:
The following shall constitute an Event of Default:
19.1 The failure of Lessee to punctually make the payments due under this Lease,
where the delinquency continues for more than ten (10) days following receipt of written notice
from Agency for payment.
19.2 The failure of Lessee to operate in the manner required by this Lease, where such
failure continues for more than ten (10) days following receipt of written notice from Agency to
correct the condition therein specified.
19.3 The failure of Lessee to maintain Premises and ImProvements in the state of repair
required under this Lease, and in a clean, sanitary, safe and satisfactory condition, where such
failure continues for more than ten (10) days fdllowing receipt of written notice from Agency to
correct the condition therein specified.
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19.3.1 Where fulfillment of said maintenance obligation requires activity over
a period of time and Lessee shall have immediately, follo~ing receipt of notice,
commenced whatever may be required to cure the particular default and continued
such performance diligently, said time limit may be waived in the manner and to
the extent determined by Agency.
19.3.2 If the maintenance deficiency involves the repair of leaking valves, said
deficiency must be corrected by Lessee within 24 hours following notification.
19.3.3 In the event Lessee fails to correct any maintenance deficiency within
the prescribed time, Agency may, at its option, exercise its rights of entry and
repair under.Paragraph 20 and/or terminate this Lease.
·
19.4 The failure of Lessee to keep, perform and observe any other promises, covenants,
conditions and agreements set forth in this Lease, where such failure continues for more than ten
(10) days after receipt of written notice from Agency to correct the condition therein specified.
19.4.1 Where fulfillment of said obligation requires activity over a period..of
time and Lessee shall have immediately, following receipt of notice, commenced
whatever may be required to cure the particular default and continued such
performance diligently, said time limit may be waived in the manner and to the
extent determined by Agency.
19.5 The filing Of a voluntary petition in bankruptcy by Lessee; the .adjudication of
Lessee as a bankrupt; the appointment of a receiver or trustee of Lessee's assets; the making of
a general assignment for the benefit of creditors; a petition or answer seeking the reorganization
of Lessee under any Federal reorganization act; the occurrence of any act which operates to
deprive Lessee permanently the rights, powers and privileges necessary for the proper conduct
of..its operations under this Lease; the levy of any attachment or execution which substantially
interferes with Lessee's operations under this Lease and which is not vacated, dismissed, Stayed
or set aside within a period of sixty (60) days; or a reasonable determination by Agency that
Lessee is insolvent.
19.5.1 Lessee shall be deemed insolvent if it has ceased to pay its debts in the
ordinary course of business or cannot pay its debts as they become due, whether
it has committed an act of bankruptcy or not, and whether insolvent, within the
meaning of Federal bankruptcy law or not.
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19.6 The determination by Agency, the State Fair Employment and Housing
Commission, the Federal Equal Employment Opportunity Commission or other State or Federal
civil rights agency, of discrimination having been committed by Lessee in violation of State
and/or Federal laws in connection with this Lease. ·
19.7 The failure to submit written plans for tenant improvements on or before the times
designated in this Lease for submission thereof.
19.8 The failure to commence required-construction of tenant improvements or any
phase thereof on or before the time approved by Agency for commencement thereof.
19.9 The failure to complete construction of tenant improvements on or before the time
approved by Agency for completion thereof.
20.0 Rie:ht of Entry.
20.1 Should Agency determine Lessee to be deficient in its performance of its'
obligations under this Lease, in'addition to all other available remedies, Agency may, but shall
not be obliged to, enter upon Premises and correct Lessee's deficiencies using Agency forc~es,
equipment and materials on premises suitable for such purposes, or by employing an independent
contractor. Agency's cost so incurred, including direct and indirect overhead costs as determined
by Agency, shall be reimbursed to Agency by Lessee and/or its sureties within thirty (30) days
of demand, thereof.
20.2 Any officers and/or authorized employees of Agency may enter upon Premises at
any and all reasonable times for the purpose of determining whether or not Lessee is in
compliance with the terms and conditions of this Lease, or for any other purpose incidental to
the rights of Agency within Premises.
20.3 In the event of abandonment, vacation or discontinuation of operations for a period
in excess of twenty-one (21) consecutive scheduled working days, Lessee hereby irrevocably
appoints Agency as an agent for continuing operation of the services granted herein,-and in
connection therewith authorizes Agency's officers, employees, agents and independent contractors
to (1) take possession of Premises, including all Improvements, equipment and inventory thereon;
(2) remove any and all persons or property on Premises and place any such property in storage
for the account of and at the expense of Lessee; (3) sublease or license the use of Premises; and
(4) after payment of all expenses of such subleasing or licensing, apply all payments realized
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therefrom to the satisfaction and/or mitigation of all damages arising from Lessee's breach of this
Lease.
20.4 Entry by the officers, employees, agents or independent contractors of Agency
upon Premises for the purpose described in this Para, graph 20 shall be without prejudice to the
exercise of any 6ther rights provided herein or by law to remedy a breach of this Lease.
21.0 Termination of Lease.
21.1 Upon the occurrence of any one or more Events of Default, Agency shall give
Lessee ten (10) days written notice by registered or certified mail, retarn receipt requested, of the
condition of default and necessary correction thereof. Said notice shall also inform Lessee that
if the default is not corrected within the time specified in the notice, the Lease shall be subject
to termination.
21.1.1 Should Lessee fail to correct the default within the time specified in the
notice, Agency shall give Lessee written notice of the termination of the Lease.
21.2 Lessee may only terminate this Lease, upon one hundred twenty (120) days writien
notice to.Agency, in the event Lessee's State or Federal funding ends, is not renewed, or is lost.
Lessee agrees to pursue all available sources of funding for its operations to' offset the loss of any
other source of funds.
21.3 Upon .termination, Agency shall have the right to take possession o'f Premises,
including all Improvements, equipment and inventory located thereon and use same for the
purpose of satisfying and or mitigating all damages arising from termination.
21.4 Action by Agency to effectuate a termination and forfeiture of possessions shall
be without prejudice to its exercise of any other rights provided herein or by law to remedy a
breach of this Lease.
22.0 Waiver.
22.1 Any waiver by Agency of any default or breach of any covenant, condition, term
and agreement contained in this Lease, shall not be construed to be a waiver Of any subsequent
or other default or breach, nor shall failure by Agency to require exact, full and complete
compliance with any of the covenants, conditions, terms or agreements contained in this Lease
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Page 24
be construed as changing the terms of this Lease in any .manner or .preventing Agency from
enforcing the full provisions hereof.
22.2 No delay, failure, omission of Agency to exercise any right, power, privilege or
option arising from any default or breach, nor any subsequent acceptance of payment then or
thereafter by Agency, shall impair any such right, power, privilege or option, or be construed as
a waiver of or acquiescence in such default or breach, or as a relinquishment of any right.
22.3 The rights, powers, options, privileges and remedies available to Agency under this
Lease shall be cumulative and shall not be construed as being exhausted by the exercise theri~of
'in one or more instances.
23.0 Surrender.
23.1 Upon expiration or termination of this Lease, Lessee shall peaceably vacate
Premises and shall remove all Improvements, equipment, inventory and personalty, unless
otherwise mutually agreed, in writing, by the parties. Title to Premises and Tenant Improvements
remains vested in Agency, pursuant t0 Paragraphs 1.3 and 4.7.
23.2 Upon expiration or termination.of this Lease, Lessee shall, at Agency's request,
execute and deliver to Agency within thirty (30) days after service of written demand, a good and'
sufficient quitclaim deed of Lessee's interest in this Lease and Premises. ShoUld Lessee fail or
refuse to deliver to Agency such quitclaim deed, written notice by Agency reciting the failure
of Lessee to execute and deliver the quitclaim deed, shall, after ten (10) days from' the date of
recordation of the notice, be conclusive evidence against Lessee and all persons claiming under
Lessee, of the termination of this Lease.
24.0 . Notices.
Any notice required to be given under the terms of this Lease or any law applicable
thereto must be either personally delivered or placed in a sealed envelope, postage prepaid,
address to the person on whom it is to be served with return receipt requested, and deposited in
the United States mail. Personal service shall be deemed complete upon delivery and service by
mail shall be deemed complete upon receipt as reflected by the return receipt. The address to
be used for any notice served by mail upon the parties shall be as follows
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ORANGE CHILDREN AND PARENTS TOGETHER, INCo
Page 25
To Lessee:
Orange Children and Parents Together, Inc.
392 South Hewes
Orange, California 92669
Attention: Sue Ko, Executive Director
To Agency:
Tustin Community Redevelopment Agency
300 Centennial Way
Tustin, California 92780
Attention: Assistant City Manager ..
Attention: Director of-Community Services
·
The parties may designate alternate addresses by giving notice as provided in this Paragraph 24.
25.0 Complete A~reement and Amendment.
,.
25.1 This Lease and exhibits attached hereto constitute the entire agreement between
the Agency and' Lessee with respect to Premises. Any other agreements, promises and
representations with resPect thereto, other than those-contained 'herein, are expressly revoked.
25.2 This Lease may only be modified in the form .of a written amendment signed by
authorized representatives of both parties.
26.0 Severability and Applicable Law.
26.1 Whenever possible, each provision of this Lease shall be interpreted in such a
manner as to be effective and valid under applicable law, but if any provision of this Lease shall
be invalid under the applicable !aw, such provision shall be ineffective only to the extent of such
prohibition or invalidity, without invalidating the remainder of that provision, or the remaining
provisions of this Lease.
26.2 This Lease has been made and entered into in the State of California and the laws
of this State shall govern its validity and interpretation in the performance hereunder by the
parties.
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27.0 Miscellaneous.
27.1 Definitions: The following word as used herein shall be construed to have the
following meaning, unless otherwise apparent from the context in which they are used.
27.1.1 "City": The City of Tustin.
27.1.2 "Agency": The Tustin Community Redevelopment Agency. The term shall
mean the Agency's Executix;e Director unless some other person or entity is
designated, in writing, by Agency's Executive Director.
27.1.3 "Executive Director": Executive Director of the'Tustin Community
Redevelopment Agency. .
27.1.4 "State": The State of California.
.27.2 Force Majeure: Except as otherwise specifically provided herein, and in the
event either party shall be delayed or prevented from performance of any act required under this
Lease by reason of fire, earthquake, war, labor dispute, or other cause without fault and beyo"nd
control of the party so obligated, performance of such acts shall be excused for the period of time
of the delay as determined, in writing, by Agency.
27.3 In the event either party commences legal proceedings for the enforcement of this
Lease, the prevailing party, shall be entitled to recover its reasonable attorney's fees and costs
incurred in the action brought upon this Lease.
27.4 Agency's Executive Director shall be responsible for the enforcement of this Lease
on behalf of Agency and shall be assisted therein by those officers and employees of Agency
designated by the Executive Director.
28.0 Conclusion.
IN WITNESS WHEREOF, Agency has, by action of the Tustin Community
Redevelopment Agency Board of Directors, authorized this Lease to be executed for and on
behalf of the Tustin Community Redevelopment Agency by the Executive Director, and Lessee
has caused the same to be executed by its duly authorized officer on the date first above written.
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TUSTIN COMMUNITY REDEVELOPMENT AGENCY AND
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Page 27
"AGENCY"
Tustin Community Redevelopment Agency
Dated:
WILLIAM A. HUSTON, Executive Director
Attest:
PAMELA STOKER
Agency Clerk
Approved as to Form-
LOIS E. JEFFREY
Agency Attorney
"LESSEE"
Orange Children and Parents Together, Inc.
Date:
By: Name
Title
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January 16, 1997
EXHIBIT "A"
Depiction of the Property
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January 16. 1997
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. t
EXHIBIT "B"
Site plan for Center
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January 16. 1997
EXHIBIT "B"
Z
EXHIBIT "C"
· .
Specific demarcation of Premises to be rented
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January 16, 1997
EXHIBIT "C"
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EXHIBIT "D"
Exterior Portion of Property
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January 16, 1997
EXHIBIT "D"
EXHIBIT "E"
Common Areas
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January 16, 1997
EXHIBIT "E"
L-
LEASE AGREEMENT BETWEEN
THE TUSTIN COMMUNITY REDEVELOPMENT AGENCY AND
CHILDREN'S BUREAU OF SOUTHERN CALIFORNIA
This Lease is made and entered into on this day of , 1997, by and
between the Tustin Community Redevelopment Agency, a municipal corporation, hereinafter
referred to as "Agency", and Children's Bureau of Southern California (CBSC), a California
nonprofit public benefit corporation, herei~iafter referred to as "Lessee."
RECITALS
A. Agency is the owner of the Tustin Family and Youth Center (the "Property"),
located at 14722 Newport Avenue, Tustin, California, and depicted on Exhibit
"A" attached hereto and incorporated herein by this reference; and
B. Agency is authorized by the provision of Government Code Section 37396 to lease
Agency property for the provision of services consistent with public park, recreation, and
community services purposes; and ~
C. Lessee desires to lease tenant space from Agency at the Property for the purpose
of providing systems integration for the coordination of educational and social services.
D. Agency desires to lease tenant space to Lessee at the Tustin Family and Youth
Center for such purposes in accordance with the terms and conditions set forth in this Leas6.
NOW, THEREFORE, in consideration of the mutual covenants, promises and conditions
set forth herein, the parties hereto agree as follows:
AGREEMENT
1.0 Premises.
1.1 The Premises which are the subject of this Lease consist of an approximate five
hundred forty-three (543) square foot interior .portion of the Property. The'site plan for the
Property is shown in Exhibit "B", attached hereto and incorporated herein by this reference. The
Premises being leased hereunder, are specifically demarcated on Exhibit "C", attached hereto and
incorporated herein by this reference.
1.2 Agency hereby leases to CBSC and CBSC hereby leases from Agency, the
Premises, upon the terms and conditions set forth in this lease.
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1.3 Lessee has inspected and accepts Premises in their present condition and makes
no demand on Agency for any improvements or alteration thereof.
1.4 The title to Premises and any improvements thereon, present or future, shall remain
in Agency or Agency's successor or assignee. Lessee agrees never to assail, contest or resist said
title.
2.0 Term and Commencement.
2.1. The term of this Lease shall be for a period of five (5) years commencing on the
first day of the calendar month following the issuance of a "Notice to Occupy Premises" by the
Agency.
.o
2.2 Lessee may apply for an extension of the term of this Lease for two (2) successive
term of five (5) years each; provided that the Lease has not been terminated, and no later than
sixty (60) days prior to the expiration date of the original term of this Lease, Agency receives
a written request therefor, signed by LesseeS.
·
2.2.1 Agency shall have the exclusive discretion and right, as a condition of
approving said extension, to renegotiate the terms of this Lease, including, but not
limited' to, base rents, common area charges, and-required tenant improvements.
2.2.2 Lessee's option to extend this Lease may be denied by Agency based on
any of the following factors:
(1). Lessee is in default of the terms of this Lease;
(2). Lessee has not received satisfactory performance evaluations
from Agency as set forth in Paragraph 9' of this Lease; or
(3). Any of Lessee's licenses have been terminated or revoked.
2.3 Possession of the Premises, including all structures, buildings and/or improvements
thereon, shall be surrendered by Lessee to Agency immediately upon termination of this Lease.
2.4 In the event Lessee holds over beyond the term herein provided with the express
'or implied consent of Agency, such holding over shall be on a month-to-month basis, subject to
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all the terms and conditions of this Lease, and at the monthly compensation provided herein.
Such holding over shall not be construed as a renewal of this Lease.
2.5 This Lease may be terminated prior to the expiration of its term by mutual written
agreement of the parties or as provided in Paragraph 21.
3.0 Permitted Uses and Hours of Operation of Premises.
3.1 The Premises shall be used only and exclusively for the following and/or licensed
child care program purposes:
3.1.1 .-The provision of systems integration ~or the coordination of educational
and social services programs; and/or ~
3.1.2 Such other purposes as are related to either of the above, provided e.xpress
written approval for such "related purposes" is given by Agency.
3.2
prohibited.
Use of the Premises for human habitation or any other purpose whatsoever is
3.3 Lessee shall submit to Agency for approval, a proposed schedule setting forth
hours and days of operation for the business. The proposed schedule shall be' submitted within
ten (10) days after Agency issues a "Notice to Occupy Premises". Lessee shall comply with the
schedule approved by Agency unless prior written authorization to deviate from the schedule has
been obtained from Agency.
4.0 Tenant Improvements.
4.1 Lessee may construct upon the Premises, at Lessee's sole expense, such additions
or alterations as are necessary for Tenant's Operations, (collectively the "Improvements") in
accordance with the provisions set forth in this Section 4.
4.2 Lessee shall prepare a written 'Improvement Plan, which shall describe the
proposed improvements, their estimated costs, and projected time frame for commencement and
completion of the Improvements. The Improvements shall comply, with applicable City codes
and the requirements of state law.
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4.3 Prior to the commencement of construction of the Improvements, Lessee shall do
all of the following:
4.3.1 Obtain Agency's written approval of all plans, specifications and time
frame for completion; and
4.3.2 Obtain all applicable permits and licenses; and
4.3.3 Comply .with any terms and conditions as may be imposed on it by Agency
regarding such Improvements.
4.4 No modification of approved plans, specifications, or time frame shall be made
by Lessee without prior written approval by Agency. ..
4.5
Improvements.
4.4.1 Any delay in construction of the Improvements due to fire, earthquake,
war, labor dispute or other events without the fault and beyond the control of
Lessee shall extend the time frame in which said construction must be completed
by the length of such delay.
,~.
Lessee shall permit the Agency to inspect the Premises during construction of'the
·
4.6 Lessee may undertake additional Improvements to the Premises subject to the
requirements of this Paragraph 4.
4.7 Ownership of the Premises and all Improvements, additions, alterations or changes
constructed upon Premises shall immediately vest and remain vested in Agency, without-
compensation being paid therefor by Agency.
4.8 l_essee shall construct, perform, complete and maintain all Improvements in a good
and workmanlike manner and with high quality materials, and shall furnish all tools, equipment,
labor and material necessary to perform and to complete same.
4.9 Agency has the right to require, during any period of construction of
Improvements, that Lessee provide a performance and/or payment bond in an amount of not less
than one hundred percent (100%) of the costs for the construction to be performed, as detailed
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in the Improvement Program, payable to the City of Tustin and executed by a surety admitted
in the State of California.
4.9.1 Said bond(s) shall be maintained in full force and effect by Lessee until
Improvements have been completed and accepted by the Agency.
4.9.2 If Lessee completes the required' Improvements in accordance with the
Improvement Program, then surety shall no longer be bound.
4.9.3 Lessee may elect, in lieu of said bonds, to' deposit with Agency cash or
United States Government securities in all respects Satisfactory to Agency's
attorney. Said cash or securities shall be deemed deposited with Agency to secure
full and satisfactory performance of the principal obligations heretofore described
for which surety may be required, and shall be released upon satisfactory
performance thereof, as evidenced by written acceptance by Agency and the
unconditional release of mechanics liens by all claimants. In lieu thereof, Lessee
may deposit the required amount in a bank or other financial institution whose
deposits are federally insured, provided the account is made payable to Agen. cy
on demand and the Certi'ficates of Deposit are delivered to Agency. Lessee shall
be entitled to all interest on the deposit and to the return of the Certificate of
Deposit upon satisfactory performance as heretofore defined.
4.10 Upon completion of Improvements, Lessee shall furnish Agency with all of the
following:
4.10.1 One (1) complete set of as-built construction drawings on Mylar or its
equivalent, including all circuit breakers, mechanical equipment, switches,
plumbing and fire sprinkler section and main valves plainly labeled with a master
index of same;
4.10.2 Operating manuals for building equipment and systems;
4.10.3 Copies of all written warranties.
4.11 Upon completion of Improvements in a manner satisfactory to Agency, Agency
shall provide Lessee with written acceptance of Improvements.
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4.12 Upon termination of this Lease, Lessee shall assign, to Agency all express
warranties furnished by other persons in connection with the construction and installation of the
Improvements.
4.13 Upon written request of Agency, Lessee shall obtain such insurance coverage as
Agency deems reasonably necessary for said Improvement Program.
5.0 Rent.
5.1 Lessee shall pay to Agency a minimum annual rent of $1,753 ("Base Rent".) One-
twelfth (1/12) of the Base Rent shall be payable monthly, in advance, on the first day of each .
month.
5.2 After the expiration of the first full year of the initial term of this Lease and each
year thereafter on the anniversary of the Lease commencement date, AgenCy shall notify Lessee
of any adjustment in the Base Rent.
5.2.1 The adjusted Base Rent'shall be calculated as follows:
Base Rent for the prior full year multiplied by the lesser of
(a) The increase in the Consumer Price Index for All
Urban Consumers, All Items, (base year 1982-1984 equals
100) for the Los Angeles/Anaheim/Riverside geographical
area, as compiled by the United States Department of Labor
for the immediately preceding year; or
(b) Four percent (4%).
5.2.2 If said Consumer Price Index ceases to exist, the parties, shall substitute
any official index published by the Bureau of Labor Statistics, or successor or
similar governmental agency, as may then be in existence and shall be' most nearly
equivalent thereto. If any such rental adjustment cannot be computed as of a rent
adjustment date, Lessee shall continue to pay the Base Rent theretofore payable
until 'such rental adjustment can be computed, at which time an. appropriate
adjustment shall be made.
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5.3 Rent shall be payable at the office of the Agency's Executive Director at 300
Centennial Way, Tustin, California 92780-1089, or at such other place or places as Agency from
time to time may designate by written notice to Lessee delivered on or before the 15th day of
the month, to be effective with the next month's payment.
5.4 Rent and other sums due Agency under this Lease shall be due as specified in this
Lease and shall bear interest at the rate of seven percent (7%) per annum until paid, if not paid
within ten (10) calendar days after the date on which the payment is due. In no event, however,
shall any such interest charges exceed the maximum amount permitted by law. Any returned
checks will be assessed the maximum fee for returned checks permitted by state law. In addition,
the interest charge shall be added to the returned check charge unless the replacement payment
is made within ten (10) calendar days of the date on which payment was due.
6.0 Common Areas.
6.1 The common areas of the Property (collectively "Common Areas") shall consist
of the parking areas, walkways, driveways, landscaped areas, reception area, lounge, corridors,
public restrooms, work area~ custodian room, and all other areas except the Premises and other
,,
leased areas of the buildin, g. Common Areas are specifically demarcated on Exhibit "D".
6.2 Common Areas shall be for the joint use of all tenants, their licensees, customers,
invitees, suppliers, employees and volunteers. Agency hereby grants to Lessee the nonexclusive
'right to. use Common Areas.
6.3 Agency shall keep and maintain Common Areas in good order, condition and
repair, at Agency's sole expense, subject to reimbursement by Lessee of its prorata share thereof
as provided in Paragraph 6.5, below.
6.4 ' Agency shall retain sole and exclusive control of Common Areas and shall have
· the right to do the following:
6.4.1 Establish and enforce reasonable rules and regulations applicable to all
lessees concerning the maintenance, management, use, and operation of Common
Areas;
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6.4.2 Temporarily close any Common Areas to perform maintenance or to
prevent a dedication of any Common Areas or the accrual of any rights of any
person or of the public in Common Areas;
6.4.3 Determine the nature and extent of Common Areas and make sUch changes
thereto as Agency deems desirable;
6.4.4 Select an independent operator to maintain and operate any Common Areas
if, at any time, Agency determines that the best interests of the lessees will be
served by doing so. Agency shall have the right to negotiate and enter into a
contract with Such operator on such terms and conditions and for such period of
time as Agency deems reasonable and proper, both as to service and as to cost.
6.5 Lessee shall pay to Agency, as additional rent, Lessee's prorata share of the
expenses incurred by Agency for maintenance and operation of certain Common Areas, including,
without limitation, the cost of the' following: cleaning; sWeeping; utilities; security systems;
janitorial services; exterior and interior lighting; installation of directional signs and markers; car
stops; parking lot restriping, sealing and repaving; insurance premiums on Premises; insurarlce
premiums on Common Areas and other areas of the Property; fire detectors and sprinkler
systems; real property taxes and assessments; and an administrative fee equal to ten percent
(10%) of the total of such costs.
6.5.1 Lessee's prorata share shall be that fractional part of the total of such costs
which the square footage of Premises bears to the total Square footage of gross
leasable space on the Property, as determined by Agency.
6.5.2 Agency and Lessee agree that Lessee's prorata share upon commencement
of the Lease is 9.13%. of the 5,934 square foot building. This prorata share shall
be adjusted from time to time based on changes in the Lessee's square footage of
leased Premises and changes in the leasable square footage of the Property.
.6.6
Lessee's prorata share of Common. Area costs shall be payable as follows:
6.6.1 From and'after the commencement date of this Lease, but subject to '
adjustment as provided below in Paragraph 6.6.2, Lessee shall pay to Agency on
or before the first (lst) day of each calendar month during the term of the Lease,
the amount billed to Lessee, which amount shall be a reasonable estimate of
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Common Area costs. Estimated Common Area charges for the first year of the
lease shall be prepaid.
6.6.2 Within a reasonable time following the end of each calendar year during
the term of this Lease, Agency shall furnish Lessee a statement covering the prior
calendar year showing the actual expenses incurred in connection with Common
Areas, the actual amount of Lessee's prorata share thereof, and the payments made
by Lessee. Lessee shall promptly pay its prorata share of such expenses which
exceeds its payments for'that prior calendar year within 30 days of billing, or, if
LeSsee's payments exceeded its prorata share of such expenses, Agency shall
promptly refund the excess.
7.0 Maintenance of Premises.
7.1 Lessee shall, at its sole cost and expense during the term of this Lease, keep and
maintain the Premises and all Improvements, fixtures, and equipment thereon, in good, operable,
usable and sanitary order and repair, and in a good, safe and first-class condition, providing for
such repairs, replacements, rebuilding and restoration as may be required by Agency to comply
with the requirements of this Lease.
7.1.1 Lessee, shall furnish all necessary equipment, supplies and material of
good quality and insufficient quantity to fulfill the requirements of this Lease and
to maintain an acceptable and professional level of maintenance.
7.1.2 Any repairs, replacements, rebuilding, restoration and/or any modifications
or additions to Premises shall have the prior written approval of Agency.
7.2 Lessee shall keep Premises free and clear of rubbish and~ litter and shall deposit
rubbish and litter in designated trash containers. No offensive matter or refuse or substance
constituting an unnecessary, unreasonable, or unlawful fire hazard, or material detrimental to the
public health shall be permitted to remain on Premises and Lessee shall prevent any accumulation
thereof from occurring. The charge for rubbish removal shall be included in Common Area
costs.
7.3 Should Lessee fail, after ten (10) days notice from Agency of the need thereof, to
perform its obligations required under this Paragraph 7, Agency, in addition to all other'available
remedies may exercise its right of entry as provided in Paragraph 20.
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7.4 All work performed under this Paragraph 7 shall be performed in accordance with
the highest industry-wide standards at a frequency sufficient to maintain the aesthetic level and
proper, condition of Premises.
7.5 Agency has the right to conduct regularly scheduled maintenance inspections of
Premises. A written report of such inspection shall be recorded, retained for reference, and
forwarded to Lessee upon request.
7.6 Lessee shall provide Agency with the names and telephone numbers of at least two
(2) qualified persons who can be contacted by Agency representatives when emergency
maintenance conditions occur during the hours when Lessee's normal work force is not present.
Agency shall call for such assistance only in the event of a genuine and substantial emergency.
7.7 Agency shall be responsible for the maintenance and repair of the exterior of all
structures on the Property, except to the extent Agency finds Lessee is responsible for damage
to such structures or as otherwise provided in this Lease. In those cases, Agency shall have the
option of either requiring Lessee to repair the damage, or repairing the damage itself and
charging Lessee for the cost of such repair, in which case, Lessee shall promptly reimburse
Agency for such costs, '~
8.0 Operatin.~ Responsibilities.
8.1 Lessee shall operate and manage Premises in a first-class manner, comparable to
other first-class businesses providing'similar services.
8.2 Lessee shall conform to and abide by all applicable City and County Ordinances
and all State and Federal laws and regulations; shall conform to and abide by all applicable rules
and regulations of Agency; and shall obtain all required permits and licenses necessary for the
operation of its business.
8.3 Lessee shall exercise every reasonable effort to prevent loud, boisterous or
disorderly persons from loitering about Premises.
8.4
Premises.
Lessee shall not knowingly permit any illegal activities to be conducted upon
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8.5 Lessee may, at its own expense, place signs upon Premises or Improvements
subject to the prior written approval of Agency. The placement of such signs shall comply with
Tustin City Code Sections 8600 et seq. and 9400 et seq. All signage placed upon the Premises
or Improvements by Lessee shall remain the property of Lessee and shall be removed by Lessee
upon termination or expiration of this Lease at Lessee's expense. Any damage caused by such
removal shall be repaired at Lessee's expense.
8.6 Lessee shall maintain an adequate and proper staff. Agency may at any time give
Lessee written notice of noncompliance with this Paragraph 8. Lessee shall take all reasonable
measures to ensure that the conduct and activities of Lessee's employees shall not be detrimental
to the interest of the public patrOnizing Property.
8.6.1 Lessee shall establish an identification system for its staff, which-clearly
indicates to patrons the names of staff on duty. The identification system may
include appropriate attire, nam.e badges and/or name plates.
8.6.2 Lessee shall comply with all laws regarding the employment of aliens and
others and ensure that all its employees meet the citizenship or alien sta. tus
requirements required by Federal and State statutes and regulations. Lessee shall
obtain from all employees the documentation of employment eligibility status
required by Federal and State statutes and regulations as they. currently exist and
as they may be hereafter amended. Lessee shall retain such documentation for all
employees for the period prescribed by law.
8.6.3 Lessee shall indemnify, defend, and hold harmless, Agency, its officers and
employees from employer sanctions and any other liability which may be assessed
against Lessee or Agency or both in connection with any alleged violation of
Federal and/or State statutes or regulations pertaining to the eligibility for
empl.oyment of persons performing services under this Lease.
8.7 Agency shall arrange for the furnis.hing of gas, electricity, water, sanitation, refuse
removal, and janitorial and landscape maintenance to the Premises. Lessee's share of gas,'
electric, water, sanitation and janitorial costs shall be considered as additional rent. Lessee shall
make its own arrangements for and pay for telephone and cable television.
8.7.1 Lessee waives any. and all claims against Agency for loss or damage
caused by a defect, deficiency or impairment of any utility system, water system,
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drainage system, waste system, heating system, gas system, electrical apparatus
or wires serving Premises.
8.7.2 Lessee shall keep the Premises free and clear of rubbish and litter and shall
deposit rubbish and litter in designated trash containers.
8.8 Lessee may provide any legal devices, mechanisms or equipment'designed for the
purpose of protecting Premises from theft, burglary or vandalism, provided prior written approval
for installation thereof is'obtained from Agency. All such purchases and installation shall be at
Lessee's sole expense.
8.8.1 Upon Agency's request, during the last thirty (30) days preceding the
expiration or termination of this Lease, Lessee shall remove same from Premises,
except for those items which have been so affixed that their removal cannot be
accomplished without damage to Premises.
8.9 Lessee, at its sole cost and expense, shall provide and install any appliances,
furniture, fixtures, equipment, padlocks, or personal property required for the operation of
Premises. "
8.9.1 During the last thirty (30) days preceding the expiration or termination of
this lease, Lessee shall remove same from Premises, except for those items which
have been so affixed that their removal cannot be accomplished without damage
to Premises.
8.9.2 Should Lessee 'fail to remove same within the required thirty (30) day
periodl Lessee shall lose all right, title and interest therein, and Agency may elect
to keep same upon Premises or to sell, remove or demolish same.
8.9.3 Lessee shall reimburse Agency for any cost incurred in the. removal or
demolition thereof, in'excess of any' consideration received from any sale.
8.10 LeSsee shall immediately correct any unsafe condition of Premises, as well as any
unsafe practices occurring thereon. Lessee shall obtain emergency medical care for any employee
or patron who is in need.thereof. Lessee shall cooperate fully with Agency in the investigation
of any injury or death occurring on Premises, including a prompt report thereof to Agency.
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8.11 Lessee shall not use or permit the use of Premises in any manner which creates
a nuisance or a measurable annoyance to persons outside Premises, including, without limitation,
live, recorded or broadcast entertainment or the use of loud speakers or sound or light apparatus
other than as may be required by law or be necessary or advisable for safety purposes.
8.12 Lessee agrees to allow inspection of Premises, at reasonable timesl by Agency,
County officials, fire officials, and State officials.
9.0 Performance Evaluation.
9.1 Lessee or its designee shall meet with the Agency's Executive Director at such
times as may be requested by Agency to review Lessees' performance under this Lease. and to
discuss any problems or other matters as determined by Agency. Agency shall provide Lessee
with a written performance evaluation pursuant to this meeting.
10.0 Advertisin_~ and Promotional Materials.
Lessee shall not promulgate nor cause to be distributed any advertising or promotional
materials without the prior written approval of Agency. That approval shall not be unreasonably
withheld or delayed and shall be deemed to be given if no objection is made within fifteen (15)
business days following a written request for approval submitted by Lessee. Such materials
include, but are not limited to: advertising in newspapers, magazines and trade journals, and radio
and/or television commercials.
11.0 Destruction of Premises.
11.1 In the event Premises shall be totally or partially destroyed by a risk covered by
insurance required by this Lease, Agency shall make the lost adjustment with the insurance
company insuring the loss and receive payment of the proceeds of insurance.
11.2 'Lessee shall either opt to restore the Premises or terminate this Lease.
11.2.1 In the event Lessee chooses 'to restore the Premises, said insurance
proceeds, if any, shall be held by Agency for the benefit of Lessee and shall be
disbursed in installments as construction progresses for payment of the costs of
restoration, upon satisfactory performance of the work required, as evidenced by
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certification of completion issued to Lessee by Agency, and release of mechanics
liens by all persons furnishing labor and materials thereon.
11.2.2 . If the insurance proceeds are insufficient to pay the actual costs of
restoration, Lessee shall deposit the amount of the deficiency with Agency upon
demand therefor by Agency, and said sums shall be held for payment of said costs
and disbursed in the manner heretofore provided.
11.2.3 Any undistributed funds shall be retained by Agency and credited to the
rent due over the remaining term of this Lease.
11.3 If Lessee elects to restore the Premises, written plans, specifications, and
construction cost estimates for the restoration shall be prepared by Lessee and forwm, ded to
Agency for approval prior to the performance of any work. Said documents shall be prepared
and submitted in a timely manner following adjustment of the loss and receiPt of the proceeds
of insurance by Agency.
11.3.1 The required construction shall be performed by Lessee and/or licensed
and bonded contractor(s), who shall be required to carry comprehensive liabili'ty
and property damage insurance, workers compensation insurance, and standard fire
and extended coverage insurance, with vandalism and malicious mischief
endorsements, during the period of construction, in amounts equal to the insurance
limits required herein, or as otherwise determined by Agency.
11.3.2 Said construction shall be commenced promptly following approval by
Agency, the issuance of applicable permits and posting of the construction site by
Agency with notice of non-responsibility, and shall be diligently prosecuted to
completion.
11.3.3 All work shall be performed in accordance with the apprOved plans and
specifications, unless changes are approved in writing, in advance, by Agency.
11.3.4 Lessee agrees that Agency may have on the site at any time during the
construction period, an inspector who shall have the. right to access Premises and
the work occurring thereon.
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11.3.5 Lessee, at the commencement of the construction work, shall notify
Agency in writing of the identity, place of business, and telephone number of
responsible person(s) in charge of the construction.
11.3.6 All construction shall be performed in a good and workmanlike manner.
Upon completion of the restoration, Lessee shall immediately record a notice of
completion with the Orange County Recorder.
11.4 In the event Premises shall be totally or partially destrOyed by a risk for which
insurance coverage is not required or provided herein, Agency shall either restore the Premises
or terminate this Lease.
12.0 Reconstruction by Agency Affecting Premises.
12.1 In the event Agency is required to partially or fully reconstruct or cause to be
constructed a new facility because of destruction of the Premises as described in Section 11.4,
this Lease shall continue in full force and effect, except that the payments to be made by Lessee
shall be abated and/or other relief afforded to the extent that Agency may determine the
reconstruction interferes with Lessee's authorized operations, and provided a claim therefor'is
filed with Agency within one hundred (100) days of the commencement of reconstruction.
12.2 Lessee shall cooperate with Agency by vacating Premises and removing all items
of inventory, trade fixtures, equipment and furnishings for such periods as are required by the
reconstruction or renovation. Lessee further agrees to cooperate in the determination of the
abatement and/or other relief to provided by furnishing all information requested relative to its
operations and permitting examination and audit of all accounting records kept in connection with
its operations.
12.3 Following completion .of the new or renovated facility, Lessee shall resume its
operations within thirty (30) days of written notice from Agency that Premises are available for
occupancy.
12.4 This Paragraph 12 shall also be applicable in the event of performance of work
on Premises that requires a partial or total closure thereof, except that the abatement and/or other
relief to be provided shall be based upon the extent Agency may determine that the reduction in
the public's use of Premises, due to the partial or total closure thereof, has affected Lessee's
operations.
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12.5 Lessee agrees to accept the remedy herein provided in the event of construction
upon Premises, and hereby waives any and all additional rights and remedies for relief or
compensation that are presently available or may hereafter be made available under the laws and
statutes of this State.
13.0 Lessor-Lessee Relationship.
13.1 This Lease is not intended and shall not be construed to create the relationship of
agent, servant, employee, or representative of the Agency by Lessee.
13.2 Lessee understands and agrees that all persons furnishing services to Lessee
pursuant to this Lease are, for purposes of. workers compensation and liability, solely employees
of Lessee and not of Agency. ..
13.3 Lessee shall bear the sole responSibility and liability for furnishing workers
compensation benefits to any person for injuries from or connected with services performed on
behalf of Lessee pursuant to this Lease.
13.4 Lessee understands and specifically agrees to inform its employees that Lesse~ is
a tenant of Agency. Lessee understands and specifically agrees to inform its employees that
Lessee is not an agent, servant, employee or representative of Agency.
13.5 Lessee understands and specifically agrees to inform its employees that they are
not agents, servants, employees, or representatives of Agency.
14.0 Defense, Indemnification and Hold Harmless.
14.1 Lessee shall defend, indemnify, and hold harmless Agency and all of its officers,
employees, agents and independent contractors thereof from any claims, suits, or actions of every
kind and description, brought for, or on the account of, injuries to or death of any person
including, but not limited to, workers and the public, or damage to Agency's property arising out
of or in connection with Lessee's activities on Premises, its failure to keep Premises in good
condition and repair, or any other action by Lessee taken in connection with oi' in performance
of this Lease, or by or on account of any act or omission by LesSee's employees, agents,
representatives, subcontractOrs, or third parties in connection with Lessee's obligations under this
Lease.
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14.2 Lessee's defense and indemnification of Agency shall'include .all costs and
expenditures, including reasonable attorney's fees incurred by Agency or its employees, officers,
agents or independent contractors, with respect to such claim or suit.
15.0 Insurance.
15.1 Lessee shall provide and maintain at its own expense during the term of this Lease
the following insurance covering its operations under this Lease. Such insurance shall be
provided with insurers licensed to do business in the State of California, with a rating of at least
A; VII, according to the latest Best's Key Rating Guide. Evidence of such insurance shall be
delivered to Agency on or before the effective date of this Lease on Agency's own form. The
Certificate of Insurance shall specifically identify this Lease and shall contain express conditions
that Agency is to be given at least thirty (30) days advance written notice, of any material
modification in or termination of insurance. Such insurance, shall be primary to and not
contributing with any other insurance maintained by Agency, and shall name the Agency, the
City of Tustin, and their officers and employees as additional insureds. All insurance shall be
on an occurrence basis.
15.1.1 General Liability Insurance:
Comprehensive general liability insurance covering Premises, operations, products
and completed operations, contractual, broad form property damage, and personal
injury, with a combined single limit of not less than one million dollars
($1,000,000) per occurrence.
15.1.2 Automobile Liability Insurance:
Automobile liability insurance covering owned and non-owned vehicles with a
combined single limit of not less than three hundred thousand dollars ($300,000)
per occurrence.
15.1.3 Workers Compensation Insurance:
Workers compensation insurance in an amount and form meeting all applicable
requirements of the California Labor Code, covering all persons providing services
by or on behalf of Lessee and all risks to such persons.
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15.1.4 Property Insurance:
Real property - all riSk insurance, including flood damage, for the full insurable.
replacement value with'a deductible of no greater than 5%, for all risk-related
coverage; and personal property insurance for the actual cash value against the
hazards of fire, theft,' burglary, vandalism and malicious mischiefi
15.2 During the period of construction of tenant improvements, the following additional
insurance may be required at Agency's discretion, on the same terms and conditions as listed in
Paragraph 15.1:
15.2.1 Builders All Risk Insurance:
Builders all-risk insurance, including flood damage, covering the entire
Improvement Program against loss or damage until completion and acceptance by
Agency, in an amount covering the full replacement value of Improvements with
a deductible not exceeding 5% of the construction cost:
e.
15.3 Failure by' Lessee to procure or maintain required insurance shall constitute an
Event of Default, upon which Agency may in'mediately terminate this Lease. Lessee's operations
shall be subject to suspension by Agency during any. Period Lessee fails to maintain required
insurance in full force and effect.
15.4 Conduct of Lessee's operations shall not commence until Lessee has complied with
the aforementiOned insurance requirements.
15.5 The specific level of liability insurance required herein is subject to renegotiation
'on an annual basis. Should either party request renegotiation with respect to the insurance to be
provided, the determination thereof shall be established through mutual negotiations between the
parties. Should no written agreement be reached by the parties, Lessee shall continue to provide
insurance at the level and in the manner heretofore provided.
16.0 Taxes and Assessments.
16.1 Should the property interest conveyed by this Lease be subject to real property
taxation and/or assessments, Lessee shall pay, before delinquency, all lawful taxes, assessments,
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fees or charges which may be levied by the State, County, Agency, or any other tax or
assessment-levying body upon Premises and any Improvements located thereon.
16.2 Lessee shall pay, before delinquency, all taxes, assessments, fees and charges on
personal property,, goods, merchandise, fixtures, appliances and equipment owned or used on
Premises.
17.0 Assienment. Sublease and Encumbrance.
17.1 The parties acknowledge that Agency is entering into this Lease' in reliance upon
the expertise and abilities of Lessee and its principals. Consequently, Lessee shall not voluntarily
assign or encumber its interest in the Lease or in Premises, or sublease or license the use of any
part of Premises, or allow any other person or entity, except Lessee's aUthorized representatives,
to occupy or use any part of Premises without the prior written consent of Agency, which consent
shall not be .unreasonably withheld.
17.2 Lessee shall not, without the prior written consent of Agency, assign, hypothecate
or mortgage this Lease, or sublease or license the use of any part of Premises. Any attempted
assignment, hypothecation, mortgage, sublease or license without.the prior written conseni' of
Agency shall render this Lease null and void.
17.3 Any action to transfer this Lease or any. interest herein in proceedings of
attachment or execution against Lessee, or in voluntary or involuntary proceedings in bankruptcy
or insolvency or receivership taken by or against Lessee, or bY any process of law including
proceedings under all applicable Federal bankruptcy laws, shall render this Lease null and void.
17.4 Agency may assign any or all of its interest in this Lease at any time.
17.5 Each and all of the provisions, agreements, terms, covenants' and conditions
contained in this Lease shall be binding upon any transferee hereof or of any interest herein.
18.0 Nondiscrimination.
18.1 Lessee hereby certifies and agrees that, in all matters affecting this Lease, it shall
comply with applicable Federal and State laws and regulations prohibiting discrimination.
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18.2 Lessee hereby certifies and agrees that all persons employed by it are, and shall
be, treated equally without regard to race, creed, color, national origin, political affiliation, marital
status, sex, age, or handicap, and in compliance with all Federal and State laws prohibiting
discrimination and employment, including, but not limited to, the Federal Civil Rights Act of
1964, the Unruh Civil Rights Act, and the Americans with Disabilities Act.
18.3 Lessee certifies and agrees that subcontractors, bidders and vendors are and shall
be selected without regard to any characteristic heretofore described.
18.4 Lessee's employment records shall be open for inspection by Agency at any
reasonable time during the term of this Lease for the purpose of verifying the practice of
nondiscrimination by Lessee in the areas heretofore described.
18.5 Any violation of the above provisions shall constitute an Event of Default as
described in Paragraph 19. Agency reserves the right to independently determine the existence
of such violations. In addition, a determination by the California Fair Employment and Housing
Department or the Federal Equal Employment Opportunity Commission or other applicable State
or Federal civil rights enforcement agency that 'Lessee has violated the nondiscrimination
provisions of this Lease, shall constitute an Event of Default. "
18.6 Lessee shall include nondiscrimination and compliance provisions in all
subcontracts to perform .work under this Lease.
19.0 Events of Default:
The following shall constitute an Event of Default:
19.1 The failure of Lessee to punctually make the payments due under this Lease,
where the delinquency continues for more than ten (10) days following receipt of written notice
from Agency for payment.
19.2 The failure of Lessee to operate in the manner required by this Lease, where such
failure continues for more than ten (10) days following receipt of written notice from Agency to
correct the condition therein specified.
19.3 The failure of Lessee to maintain Premises and Improvements in the state of repair
required under this Lease, and in a clean, sanitary, safe and satisfactory condition, where such
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failure continues for' more than ten (10) days following receipt of written notice from Agency to
correct the condition therein specified.
19.3.1 Where fulfillment of said maintenance obligation requires activity over
a period of time and Lessee shall have immediately, following receipt of notice,
commenced whatever may be required to cure the particular default and continued
such performance diligently, said time limit may be waived in the manner and to
the extent determined by Agency.
19.3.2 If the maintenance deficiency involves the repair of leaking valves, said
deficiency must be corrected by Lessee within 24 hours following notification.
19.3.3 In the event Lessee fails to correct any maintenance deficiency, within
the prescribed time, Agency may, at its option, exercise its rights of entry and
repair under Paragraph 20 and/or terminate this Lease.
19.4 The failure of Lessee to keep, perform and observe any other promises, covenants,
conditions and agreements set forth in this Lease, where such failure continues for more than ten
(10) days after receipt of written notice from Agency to correct the condition therein specifi'ed.
19.4.1 Where fulfillment of said obligation requires activity over a period of
time and Lessee shall have immediately, following receipt of notice, commenced
whatever may be required to cure the particular default and continued such
performance diligently, said time limit may be waived in the manner and to the
extent determined by Agency.
19.5 The filing of a voluntary petition in bankruptcy by Lessee; the adjudication of
Lessee as a bankruPt; the appointment of a receiver or trustee of Lessee's assets; the making of
.a general assignment for the benefit of creditors; a petition or answer seeking the reorganization
of Lessee under any Federal reorganization act; the occurrence of any act which operates to
deprive Lessee permanently the rights, powers and privileges necessary for the proper conduct
of its operations under this Lease; the levy of any attachment or execution which substantially
interferes with Lessee's operations under this Lease and which is not vacated, dismissed, stayed
or set aside within a period of sixty (60) days; or a reasonable determination by Agency that
Lessee is insolvent.
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19.5.1 Lessee shall be deemed insolvent if it has ceased to pay its debts in the
ordinary course of business or cannot pay its debts as they become due, whether
it has committed an act of bankruptcy or not, and whether insolvent, within the
meaning of Federal bankruptcy law or not.
19.6 The determination by Agency, the State Fair Employment and Housing
Commission, the Federal Equal Employment Opportunity Commission or other State or Federal
civil rights agency, of discrimination having been committed by Lessee in violation, of State
and/or Federal laws in connection with this Lease.
19.7 The failure to submit written plans for tenant improvements on or before the times
designated in this Lease for submission thereof.
19.8 The .failure to commence required construction of tenant Improvements or any
phase.thereof on or before the time approved by Agency for commencement thereof.
19.9 The failure to complete construction of tenant Improvements on or before the time
approVed by Agency for completion thereof.
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20.0 Right of Entry.
20.1 Should Agency determine Lessee to be deficient in its .performance of its
obligations under this Lease, in addition to all other available remedies, Agency may, but shall
not be obliged to, enter upon Premises and correct Lessee's deficiencies Using Agency forces,
equipment and materials on Premises suitable for such purposes, or by employing an independent
contractor. Agency's cost so incurred, including direct and indirect overhead costs as determined
by Agency, shall be reimbursed to Agency by Lessee and/or its sureties within thirty (30) days
of demand thereof.
20.2 Any officers and/or authorized employees of Agency may enter upon Premises at
any and all reasonable times for the purpose of determining whether or not Lessee is in
compliance with the terms and conditions of this Lease, or for any other purpose incidental to
the rights of Agency within Premises.
20.3 In the event of abandonment, vacation or discontinuation of operations for a period
in excess of twenty-one (21) consecutive scheduled working days, 'Lessee hereby irrevocably
appoints Agency as an agent for continuing operation of the services granted herein, and in
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connection therewith authorizes Agency's officers, employees, agents and independent contractors
to (1) take possession of. Premises, including all Improvements, equipment and inventory thereon;
(2) remove any and all persons or property on Premises and place any such property in storage
for the account of and at the expense of Lessee; (3) Sublease or license the use of Premises; and
(4) after payment of all expenses of such subleasing or licensing, apply all payments realized
therefrom to the satisfaction and/or mitigation of all damages arising from Lessee's breach of this
Lease.
20.4 . Entry by the officers, employees, agents or independent contractors of Agency
upon Premises for the purpose described in this Paragraph 20 shall be without prejudice to the
exercise of any other rights provided herein or by law to remedy a breach of this Lease.
21.0 Termination of Lease.
21.1 Upon the occurrence of any one or more Events of Default, Agency shall give
Lessee ten (10) days written notice by registered or certified mail, return receipt requested, of the
condition of default and necessary correction thereof. Said notice shall also inform Lessee that
if the default is not corrected within the time specified in the notice, the Lease shall be subj. ect
to termination.
21.1.1 Should Lessee fail to correct the default within the time specified in the
notice, Agency shall give Lessee written notice of the termination of the Lease.
21.2 Lessee may only terminate this Lease, upon one hundred twenty (120) days written
notice to Agency, in the event Lessee's State or Federal funding ends, is not renewed, or is lost.
Lessee agrees to pursue all available sources of funding for its operations to offset the loss of any
other source of funds.
21.3 Upon termination, Agency shall have the right to take possession of Premises,
including all Improvements, equipment and inventory located thereon and use same for the'
purpose of satisfying and or mitigating all damages arising from termination.
21.4 Action by Agency to effectuate a termination and forfeiture of possessions shall
be without prejudice to its exercise of any other rights provided herein or by law to remedy a
breach of this Lease.
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22.0 Waiver.
22.1 Any waiver by Agency of any default or breach of any covenant, condition, term
and agreement contained in this Lease, shall not be construed to be a waiver of any subsequent
or other default or breach, nor shall failure by Agency to require exact, full and complete
compliance with any of the covenants, conditions, terms or agreements contained in this Lease
be construed as changing the terms of this Lease in any manner or preventing Agency from
enforcing the full provisions hereof.
22.2 No delay, failure, omission of Agency to exercise any right, power, privilege or
option arising from any default or breach, nor any subsequent acceptance of payment then or
thereafter by Agency, shall impair any such right, power, privilege or option, or be construed as
a waiver of or acquiescence in such default or breach, or as a relinquishment of any righI.
22.3 The rights, powers, options, privileges and remedies available to Agency under this
Lease shall be cumulative and shall not be construed as being exhausted by the exercise thereof
in one or more instances.
23.0 Surrender.
23.1 Upon expiration or termination of this Lease, Lessee shall peaceably vacate
Premises and shall remove all Improvements, equipment, inventory and personalty, unless
otherwise mutually agreed, in writing, by the parties. Title to Premises and Tenant' Improvements
remains vested in Agency, pursuant to Paragraphs 1.3 and 4.7.
23.2 Upon expiration or termination of this Lease, Lessee shall, at Agency's request,
execute and deliver to Agency within thirty (30) days after service of written demand, a good and
sufficient quitclaim deed of Lessee's interest in this Lease and Premises. Should Lessee fail or
refuse to deliver to Agency such quitclaim deed, written notice by Agency reciting the failure
of Lessee to execute and deliver the quitclaim deed, shall, after ten (10) days from the date of
recordation of the notice, be conclusive evidence against Lessee and all persons claiming under
Lessee, of the termination of this Lease.
24.0 Notices.
Any notice required to be given under the terms of this Lease 'or any law applicable
thereto must be either personally delivered or placed in a sealed envelope, postage prepaid,
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address to the person on whom it is to be served with return receipt requested, and deposited in
the United States mail. Personal service shall be deemed complete upon delivery and service by
mail shall be deemed complete upon receipt as reflected by the return receipt. The address to
be used for any notice served by mail upon the parties shall be as follows
To Lessee:
Children'.s Bureau of Southern California
50 S. Anaheim Blvd., Suite 241
Anaheim, California, 92805
Attention: Dorothy Manzer
To Agency:
Tustin Community Redevelopment Agency
300 Centennial Way.
Tustin, California 92780
Attention: Assistant City Manager
Attention: Director of Community Services
The parties may designate alternate addresses by giving notice as provided in this Paragraph 24.
25.0 Complete A~reement and Amendment.
25.i This Lease and exhibits attached hereto constitute the entire agreement between
the Agency and Lessee with respect to Premises. Any other agreements, promises and
representations with respect thereto, other than those contained herein, are expressly revoked.
25.2 This Lease may only be modified in the form of a written amendment signed by
authorized representatives of both parties.
26.0 Severabilit¥ and Applicable Law.
26.1 Whenever possible, each provision of this Lease shall be interpreted in such a
manner as to be effective and valid under applicable law, but if any provision of this 'Lease shall
be invalid under the applicable law, such provision shall be ineffective only to the extent of such
prohibition or invalidity, without invalidating the remainder of that prOvision, or the remaining
provisions of this Lease.
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26.2 This Lease has been made and entered into in the State of California and the laws
of this State shall govern its validity and interpretation in the performance hereunder by the
parties.
27.0 Miscellaneous.
27.1 Definitions: The following word as used'herein shall be construed to have the
following meaning, unless otherwise apparent from the context in which they are used.
27.1.1 "City": The City of Tustin.
27.1.2 "Agency": The Tustin Community Redevelopment Agency. The term shall
mean the Agency's Executive Director unless some other person or entity is
designated, in writing, by Agency's. Executive Director.
27.1:3 "Executive Director": Executive Director of the Tustin Community
Redevelopment Agency.
27.1.4 "State": The State of California.
27.2 Force Majeure: 'Except as Otherwise specifically provided herein, and in the
event either party shall be delayed or prevented from performance of any act required under this
Lease by reason of fire, earthquake, war, labor dispute, or other cause without fault and beyond
control of the party so obligated, performance of such acts shall be excused for the period of time
of the delay as determined, in writing, by Agency.
27.3 In the event either party commences legal proceedings for the enforcement of this
Lease, 'the prevailing party shall be entitled to recover its reasonable attorney's fees and costs
incurred in the action brought upon this Lease.
27.4 Agency's Executive Director shall be responsible for the enforcement of this Lease
on behalf of Agency and shall be assisted therein by those officers and employees of Agency
designated by the Executive Director.
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28.0 Conclusion.
IN WITNESS WHEREOF, Agency has, by action of the Tustin Community
Redevelopment Agency Board of Directors, authorized this Lease to be executed for and on
behalf of the Tustin Community Redevelopment Agency by the Executive Director, and Lessee
has caused the same to be executed by its duly authorized officer on the date first above written.
"AGENCY"
Tustin Community Redevelopment Agency
Dated:
WILLIAM A. HUSTON, Executive Director
Attest:
PAMELA STOKER
Agency Clerk
Approved as to Form:
LOIS E. JEFFREY
Agency Attorney
"LESSEE"
Children's Bureau of Southern California
Date:
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By: Name
Title
EXHIBIT "A"
Depiction of the Property
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~;XHIBIT '"A"
'13
EXHIBIT "B"
Site plan for Center
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EXHIBIT "B"
f
!
t
z
mm
EXHIB IT ~ C"
Specific demarcation of Premises to be rented
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EXHIBIT "C"
EXHIBIT "D"
Common Areas
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~,XHIBIT "D"
¢.
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1 RESOLUTION NO. 97-8
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A RESOLUTION OF THE C1TY .COUNCIL OF THE CITY OF
TUSTIN, CALIFORNIA, APPROVING THE PROPOSED LEASES
BETWEEN THE TUSTIN COMMUNITY REDEVELOPMENT
AGENCY AND ORANGE CHILDREN AND PARENTS TOGETHER,
INC. AND CHI1,DREN'S BUREAU OF SOUTHERN CALIFORNIA
The City Council of the City of Tustin, California, DOES HEREBY RESOLVE as follows:
I. The City Council finds and determines as follows:
mo
Pursuant to Section 33433 of the State of California Community
Redevelopment Law (CRL), the Tustin Community Redevelopment Agency
"Agency" must prepare a report providing certain information concerning all
sales and/or leases to be entered into by the Agency for development purposes
and such report has been prepared; and
Bo
The Tustin Community Redevelopment Agency is proposing to enter into
leases with The Orange Children and Parents Together, Inc. and The
Children's Bureau of Southem California for property it acquired and
improved with tax increment moneys at 14722 Newport Avenue, Tustin,
California; and
C.
D.
Pursuant to Section 33433 of CRL, a public hearing must be held by the City
Council to obtain public comment concerning the proposed leases, the public
.hearing to be noticed pursuant to said Section 33433; and
e.
The City Council must approve the proposed leases before the Redevelopment
Agency enters into the leases; and
E.
The Redevelopment Agency has prepared, advertised in accordance with law
and made available for public review the report required by said Section 33433;
and
F. On February 3, 1997, the City Cotmcilheld the required public hearing; and
G.
The comideration for the proposed leases is not less than the fair reuse value at
the use and with the covenants and conditions and development costs
authorized by the proposed lease; and
H°
The proposed leases of the subject property will assist in the elimination blight;
and
The proposed leases of the subject property are consistent with the
Implementation Plan for the South Central Redevelopment Project Area
adopted pursuant to Section 33490.
Il. The City Council does hereby approve the following proposed leases
A lease between the Tustin Community Redevelopment Agency and Orange
Children and Parents Together, Inc.; and
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Resolution No. 97-8
Page 2
.
A lease between The Tustin Community Redevelopment Agency and
Children's Bureau of Southern California for the use of the Agency-owned
property at 14722 Newport Avenue.
PASSED AND ADOP'I~D at a regular meeting of the City Council held on the 3rd
day of February, 1997.
Tracy W-dis Worley
Mayor
Pamela Stoker
City Clerk
STATE OF CALIFORNIA ) .
COUNTY OF ORANGE )
CITY OF TUSTIN )
I, Pamela Stoker, City Clerk and ex-officio Clerk of the City Council of the City of Tustin,
California, do hereby certify that the whole number of the members of the City Council of
the City of Tustin is five; that the above and foregoing Resolution No. 97-8 was duly
passed and adopted at a regular meeting of the Tustin City Council, held on the 3rd day of
February, 1997, by the following vote:
COUNCILMEMBER AYES:
COUNCILMEMBER NOES:
COUNCILMEMBER ABSTAINED:
COUNC 'IDME~ER ABSENT:
PAMELA STOKER
CITY .CLERK