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HomeMy WebLinkAboutRPT 2 MOU FIRE FACILITY 3-19-90REPORTS NO. 2 M9-90 ►..: ik —1 Inter - Com DATE: MARCH 19, 1990 TO: WILLIAM A. HUSTON, CITY MANAGER FROM: CHRISTINE SHINGLETON, DIRECTOR OF COMMUNITY DEVELOPMENT SUBJECT: APPROVAL OF MEMORANDUM OF UNDERSTANDING AND REIMBURSEMENT AGREEMENT REGARDING CONSTRUCTION OF A FIRE FACILITY AND PURCHASE OF A NEW ENGINE PUMPER TO SERVE TUSTIN RECOMMENDATION It is recommended that the City Council authorize the City Manager to: 1. Execute the attached Memorandum of Understanding regarding the development of a fire protection facility in East Tustin, subject to final City Attorney approval. 2. Execute the attached Reimbursement Agreement for the Irvine Company assuring Project Management responsibilities for construction of the fire protection facilities, subject to final City Attorney approval. BACKGROUND Provisions of the East Tustin Development Agreement ("Agreement") determined the need for an additional fire protection facility to serve East Tustin and required the Irvine Company ("Company") to dedicate land adequate to support the facility and to fund the construction of the facility and acquisition of a new engine pumper at a cost of $1.3 million dollars. Consistent with the methods of financing authorized by the Agreement, the City has implemented a developer fee program to finance the fire protection facility and equipment; fees are payable upon issuance of building permits for development projects in East Tustin. With the rapid build -out which is occurring in East Tustin, the Fire Department was particularly interested in ensuring adequate emergency response and expressed a desire to expedite the schedule for construction of the fire protection facility. After discussing this issue with the Orange County Fire Department (OCFD), the Irvine Company and the City staff, the Irvine Company agreed to assume project management responsibilities for design and construction of the new fire station. In order to implement this arrangement, a tri -party agreement between the City, the Company and OCFD has been prepared to define the role of each party in the City Council Report Fire Station MOU and Reimbursement Agreement March 19, 1990 Page two development process. The draft Memorandum which is attached for Council approval provides agreement on the following major points: - The Company will act as project manager and will hire a design consultant and general contractor for construction of the facility. Upon completion of construction, the Company will dedicate the site and facility to the City. The OCFD will provide construction administration and coordination services. - The City utilizing developer fees will purchase, with OCFD assistance, a fire engine pumper which will be offered to OCFD for a no cost lease. The City will provide to OCFD a no cost lease for OCFD's use of the fire protection facility. OCFD will be responsible for all operation, maintenance and repair costs. The City and the Company would also agree to enter into a Reimbursement Agreement for financing construction of the fire protection facility. The Agreement defines the mechanism for the City to release collected developer fees as costs are incurred by the Company for the fire protection facility. A copy of the Reimbursement AGreement is also attached for Council action. Christine Shingl ton Director of Community Development CAS:pef Attachments: Memorandum of Understanding Reimbursement Agreement Community Development Department MEMORANDUM OF UNDERSTANDING THIS MEMORANDUM OF UNDERSTANDING by and among the City of Tustin (the "City"), the Orange County Fire Department ("OCFD"), and The Irvine Company, doing business as Foothill Community Builders ("Company"), sets forth in general terms those fundamental principles that have been reached during numerous meetings between the parties regarding the development of a fire protection facility to serve the East Tustin area ("East Tustin") . In general, the parties have agreed upon the following terms and principles: 1. The City and Company entered into the East Tustin Development Agreement (the "Agreement") on December 3, 1986. Section 1.10 of the Agreement determined the need for an additional fire protection facility to serve East Tustin. Company has agreed (a) to make available to City at no cost a one and one-quarter (14) acre parcel of land adequate to support a fire protection facility; (b) to provide for construction of the fire protection facility in conformance with City and OCFD standards; and (c) to provide funding for a new engine pumper for the fire protection facility. The total cost for (b) and (c) shall not exceed 1.3 million dollars in 1986 dollars, excluding land. Consistent with the financing methods described in the Agreement, the City and Company have implemented a fee program to finance the fire protection facility and equipment, payable upon issuance of building permits for development projects in East Tustin. 011\WP50\DEC\IRVINE\MOU.004 03/13/90 2:21pm 2. Company will assume responsibilities for the design and construction of the fire protection facility in conformity with plans and specifications approved by City, OCFD and County of Orange General Services Agency, Architect and Engineering Division ("GSA/A&E") and will upon completion of construction dedicate and convey fee title to City, with encumbrances acceptable to City, the one and one-quarter (14) acre parcel of land described on Exhibit "A" attached hereto (the "Property"), upon which the fire protection facility comprising approximately 8,000 square feet will have been constructed. The site will be used only for operation of the fire protection facility, provided, however that the City may use one-quarter (4) acre of the property for a city maintenance facility. 3. OCFD agrees to provide the following services: (a) support services from GSA Real Estate Division for the development of all agreements; (b) support services from GSA/A&E for review and counsel on the design and construction of the fire protection facility; (c) construction monitoring and project coordination by the OCFD Battalion Chief assigned to East Tustin under the lead direction of GSA/A&E; (d) OCFD will assume the primary role in resolving any or all issues relating to implementation of the design and construction of the fire protection facility, taking into account management of project costs under the lead direction of GSA/A&E; and (e) OCFD will assist City in the procurement process and preparation of the specifications of the Fire Engine. 011\WP50\DEC\IRVINE\M0U.004 2 03/13/90 2:21pm 4. City, with the cooperation and assistance of OCFD, will acquire a new engine pumper ("Fire Engine") for OCFD to use at the fire protection facility. 5. City agrees that no later than one (1) year prior to the projected opening date of the fire protection facility, City will ensure that approximately $200,000 of the funds designated to finance construction of the fire protection facility and purchase of the Fire Engine pursuant to the Development Agreement will be available for the purchase of a fully -equipped Type 1 fire engine. The City will purchase and own the Fire Engine and equipment and City will offer to enter into a standard no -cost lease agreement for OCFD's use of the Fire Engine subject to the agreement that OCFD will assume all responsibility for maintenance and repair of said equipment during the term of the Lease Agreement. The Fire Engine may be used for automatic or mutual aid assistance to other communities or cities and shall be considered part of OCFD's automatic fleet for purposes of maintenance, rotation and replacement provided an equivalent Fire Engine is assigned to Station 43. In the event the City forms its own fire department in the future, county and OCFD will at no cost to City provide a fire engine or equivalent value, reflecting depreciation, to replace the fire engine originally provided by the City for Station 43. 6. The City shall accept the grant of conveyance of the property and the fire protection facility thereon promptly upon 011\WP50\DEC\IRVINE\MOU.004 3 03/13/90 2:21pm satisfactory completion of the construction of the fire protection facility. 7. It is contemplated that OCFD and the City will enter into a no -cost lease agreement for OCFD's use of the fire protection facility. OCFD will assume responsibility for operation, maintenance, and repair of the fire protection facility during the term of the lease agreement. 8. City, OCFD, GSA/A&E and Company shall mutually agree upon a schedule for the design and construction of the fire protection facility. OCFD and City shall not withhold approval for or issuance of building permits and certificates of occupancy for Company's development in East Tustin based on the need for a fire protection facility after completion of the design and after commencement of construction of the fire protection facility in accordance with plans and specifications approved by City. City, OCFD and Company in their respective roles agree to seek the lowest design and construction costs for the project. 9. City and Company agree to enter into a Reimbursement Agreement which shall provide that City will pay Company an amount equal to the fees assessed upon and collected from development projects in East Tustin for the purposes of financing the design and construction of the fire protection facility and purchase of the fire engine. 10. Upon acceptance of the general terms of this Memorandum of Understanding, OCFD will schedule a project -scoping meeting involving appropriate staff from City, Company, and OCFD. The 011\WP50\DEC\IRVINE\MOU.004 4 03/13/90 2:21pm desired goal of the project scoping meeting shall be to identify project milestones, prepare a schedule acceptable to all parties, and identify key responsibilities for the development of a Project Implementation Agreement. The parties agree that this Memorandum of Understanding will be considered effective as of the latest signature date below. DATED: APPROVED AS TO FORM: JAMES G. ROURKE City Attorney DATED: DATED: CITY OF TUSTIN By. William Huston City Manager ORANGE COUNTY FIRE DEPARTMENT By. Patrick L. Walker Division Chief THE IRVINE COMPANY, a Michigan corporation, doing business as FOOTHILL COMMUNITY BUILDERS By. .C. B. Olson, President Foothill Community Builders By: James Cavanaugh Assistant Secretary The Irvine Company 011\WP50\DEC\IRVINE\M0U.004 5 03/13/90 2:21pm EXHIBIT "A" Property Description 011\WP50\DEC\IRVINE\MOU.004 6 03/13/90 2:21pm REIMBURSEMENT AGREEMENT FOR DEDICATION AND CONSTRUCTION OF A FIRE PROTECTION FACILITY AND PURCHASE OF A NEW ENGINE PUMPER THIS AGREEMENT this day of THE IRVINE COMPANY, Foothill Community TUSTIN, a municipal "City") (the "Agreement") is made and entered into , 1990, by and between a Michigan corporation, doing business as Builders (the "Company"), and the CITY OF corporation of the State of California (the RECITALS: A. Company is the owner of certain real property located within the area of City known as the East Tustin area ("East Tustin") . B. The Company and the City entered into that certain East Tustin Development Agreement dated December 3, 1986 (the "Development Agreement") pursuant to California Government Code Sections 65864 et sea. C. The Development Agreement provides among other things, that the Company shall dedicate to City a parcel of real property adequate for the purpose of development and construction of a fire protection facility of approximately 8,000 square feet to serve East Tustin and that Company is obligated to fund the construction of the fire protection facility of approximately 8000 square feet and the purchase of a new engine pumper (the "Fire Engine") in the ano nt of $1.3 million cayculated in 1086 dollars (the "Fire Protection Facility Obligation") and authorizes City to establish a program to collect fees on development in East Tustin. D. In conjunction with City's approval of Tentative Tract 13627, Company is required to dedicate and convey to the City one and one-quarter (114) acres of real property described in Exhibit A and shown on Exhibit B on which Company shall have constructed a fire protection facility of 8,000 square feet. Dedication of the said real property to City will be made and accepted upon satisfactory completion of construction for the proposed fire protection facility. E. The fee program established by City provides that certain fees (the "City Fees") shall be assessed upon each development project site within East Tustin and collected by the City for the specific purpose of financing the construction of the fire protection facility and the purchase of the fire engine prior to the issuance of building permits, calculated generally by distributing the Fire Protection Facility Obligation among 011\WP50\DEC\IRVINE\REI.004 03/13/90 2:21pm each phase of development within East Tustin as set forth in Tustin Council Resolution No. 88-12, a copy of which is attached hereto as Exhibit C, with such calculations based upon gross acreages of each phase. F. The City, the Company, and the Orange County Fire Department ("OCFD") entered into that certain Memorandum of Understanding effective as of , 1990 (the "Memorandum"), providing among other things, that the Company shall assume the responsibility for the design, development, and construction of the improvements and building(s) comprising the fire protection facility (the "Project") in coordination with City and OCFD. G. City and Company desire to provide for and define the duties of the Company in assuming the aforesaid obligations for the Project and to provide for payment by City to Company of the City Fees previously collected by City and City's waiver of the right to collect any future City Fees. AGREEMENT NOW, THEREFORE, in consideration of the foregoing and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, City and Company agree as follows: 1. Construction and Conveyance of Fire Protection Facility. a. Company shall at its sole cost and expense (subject to the reimbursement provided hereinafter) design and construct the Project with the power and authority to enter into and administer any or all contracts and procure any or all necessary services, including, without limitation, employment of managers, supervisors, design consultants, architects, general contractors, and sub contractors. b. Company agrees to cause the completion of the Project in accordance with the plans and specifications (the "Plans") approved by City, which approval City agrees it shall not unreasonably withhold. The contents of the Plans shall be as further defined in Exhibit D attached hereto. In preparing the Plans, Company agrees to consult with OCFD and to submit the Plans to City for review and approval prior to the commencement of construction of the Project. Company shall have the affirmative duty under this agreement to obtain the lowest construction and design costs for the Project in its role as project manager. C. City and Company in coordination with OCFD shall agree upon a construction schedule for the completion of the Project. 011\WP50\DEC\IRVINE\REI.004 2 03/13/90 2:21pm d. Upon completion of the Project, the Company shall dedicate the land and convey to City, by Grant Deed in the form of Exhibit E attached hereto, fee title to the real property and all improvements upon and appurtenant thereto to City, and City shall promptly accept such conveyance. 2. Reimbursement and Waiver of Fees. In consideration of the performance of the obligations of the Company set forth herein, the City agrees during construction to make payments to Company from City Fees within thirty (30) days of City's receipt of reimbursement requests commensurate with the portion of completed construction, subject to the provisions of the following sentence. If there is a shortfall in cumulative fees collected (i.e. Cumulative Fees collected by City are less than construction costs billed by the Company) then City agrees to reimburse company within thirty (30) days of City's receipt of such fees for the portion not reimbursed. City may withhold from payments to Company the cost of the fire engine, up to an amount not to exceed $200,000 (the "Fire Engine Fund") from the fees collected by City, which Fire Engine Fund shall be held in trust by the City in an interest bearing account to pay for the purchase of the Fire Engine pursuant to Section 4 below. Provided further, however, that City shall have no obligation to pay to or reimburse Company any amounts as provided above if and to the extent Developer fees prescribed to be paid to City by the Development Agreement between City and Company fall below one point three million dollars ($1.3M). 3. Use of Property. City agrees that the Property dedicated and conveyed by the Company to City pursuant to this Agreement shall be used only for the development, construction, and operation of the fire protection facility, provided, however, that one quarter (1/4) acre of the Property may be used by City only as a municipal maintenance facility. 4. Fire Engine Purchase. No later than one (1) year prior to the projected opening date of the fire protection facility, City shall pay from the collected City Fees an amount equal to the purchase price of the fire engine, not to exceed the amount of the Fire Engine Fund. OCFD will take primary responsibility for the procurement of the Fire Engine, subject to City review and approval. Sole and complete title and ownership of the Fire Engine shall be in City. 5. Cost of Completion. City and Company agree that Company is not obligated to incur any expenses or expend any monies in causing the completion of the Project beyond the amounts specified hereinabove less the cost of the purchase of the Fire Engine (the "Project Fund"). Company shall on a periodic basis, provide City that estimated costs for the completion of the Project. In the event the estimated costs for completion of the Project exceed the amount of the Project Fund (the "Excess Amount"), Company shall have no further obligations under this 011\WP50\DEC\IRVINE\REI.004 3 03/13/90 2:21pm Agreement or any other agreement, nor shall Company have any further obligation to cause the completion of the Project, unless and until City takes action to finance the Excess Amount so as to provide funds to allow completion of the Project by either of the following: a. City shall provide in its general fund budget for the payment of the Excess Amount to complete the Project, or b. The City shall have identified or established a special fund for the payment of the Excess Amount to complete the Project. 6. Agreement Not to Withhold Approval. Upon commencement of construction of the Project by Company, City agrees not to withhold approval for or issuance of building permits and certificates of occupancy for Company's development projects in East Tustin based solely on the need for a fire protection facility so long as Company is not substantially and materially delinquent in meeting the agreed-upon design and construction schedule for the Project. Company shall not be deemed to be delinquent in meeting the agreed-upon design and construction schedule for the Project by the fact that the Project has been delayed or abated due to the occurrence and non -resolution of an Excess Amount as provided above. 7. Indemnification. Neither Company nor any officer or employee thereof is responsible for any damage or liability occurring by reasons of anything done or omitted to be done by City under or in connection with any work, authority or jurisdiction delegated to City under this Agreement. It is understood and agreed that, pursuant to Government Code Section 895.4, City shall defend, indemnify and save harmless the Company from all claims, suits or, actions of every name, kind and description brought for or on account of injuries to or death of any person or damage to property resulting from anything done or omitted to be done by City under or in connection with any work, authority or jurisdiction delegated to the City under this Agreement. Neither City nor any officer or employee thereof is responsible for any damage or liability occurring by reasons of anything done or omitted to be done by Company under or in connection with any work, authority or jurisdiction delegated to them under this Agreement. It is understood and agreed that, pursuant to Government Code Section 895.4, Company shall defend, indemnify and save harmless the City from all claims, suits or actions of every name, kind and description brought for or on account of injuries to or death of any person or damage to property resulting from anything done or omitted to be done by Company under or in connection with any work, authority or jurisdiction delegated to them under this Agreement. 8. Successors and Assigns: Assignment. This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and assigns. The Company may assign its rights and duties hereunder upon receipt of 011\WP50\DEC\IRVINE\REI.004 4 03/13/90 2:21pm written approval of City which City agrees not to unnecessarily withhold. 9. Time of Essence. Time is of the essence as to each provision of this Agreement in which time is an element. 10. Titles. Titles and headings are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement nor as evidence of the intentions of the parties hereto. 11. Waiver. Either party hereto may specifically waive any breach of this Agreement by the other party, but no such waiver shall constitute a continuing waiver of similar other breaches. A waiving party may, at any time, upon notice given in writing to the breaching party, direct future compliance with the waived term or terms of this Agreement, in which event the breaching party shall comply as directed from such time forward. All remedies, rights, undertakings, obligations, and agreements contained in this Agreement shall be cumulative and not mutually -exclusive. 12. Invalidity of Provision. If any provision of this Agreement as applied to either party or to any circumstances shall be adjudged by a court to be void or unenforceable, the same shall in no way affect any other provisions of this Agreement, the application of such provision in any other circumstances, or the validity or enforceability of the Agreement as a whole. 13. Governing Law. The statutory, administrative, and judicial law of the State of California shall govern the execution and performance of this Agreement. 14. Complete Agreement. This Agreement, together with the Memorandum of Understanding dated , 1990 define the entire agreement and understandings concerning the subject matter hereof between the parties and supersedes and replaces all prior negotiations and proposed agreements, written and oral and if any conflict arises between the interpretation of this Agreement and the Development Agreement concerning the subject matter hereof, the terms of this Agreement shall prevail. Each of the parties hereto acknowledges that no other party, nor any agent or attorney of any other party, has made any promise, representation, or warranty whatsoever, express or implied, not contained herein except to induce it to execute this Agreement and acknowledges that each has not executed this Agreement in reliance upon any such promise, representation, or warranty not contained herein. 15. Attorneys' Fees. If an action is brought by the Company or the City to enforce any of the terms and provisions of this Agreement or to recover any damages alleged to be due by 011\WP50\DEC\IRVINE\REI.004 5 03/13/90 2:21pm reason of a breach hereof, the prevailing party in such action shall be entitled to attorneys' fees in a reasonable amount, and such fees may be recovered as part of the costs of such action and included in any judgment entered thereon. 16. Execution of Agreement. Each of the persons executing this Agreement on behalf of the signatory entity on whose he purports to act represents and warrants that he is duly authorized to execute this Agreement on behalf of said signatory entity. Each of the attorneys (law firms) approving the form of this Agreement on behalf of its respective client hereby renders its opinion that the execution of the Agreement by the person(s) purporting to act for such client is valid and binding on such signatory entity. IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written. ATTEST: Approved as to Form JAMES G. ROURKE City Attorney Approved as to Form TIC Counsel CITY OF TUSTIN BY William Huston City Manager THE IRVINE COMPANY, a Michigan corporation, doing business as FOOTHILL COMMUNITY BUILDERS BY C. B. OLSON President, Foothill Community Builders JAMES R. CAVANAUGH Assistant Secretary, The Irvine Company 011\WP50\DEC\IRVINE\REI.004 6 03/13/90 2:21pm EXHIBIT A (Description of Property) 011\WP50\DEC\IRVINE\REI.004 7 03/13/90 2:21pm EXHIBIT B (Map of Property) 011\WP50\DEC\IRVINE\REI.004 8 03/13/90 2:21pm EXHIBIT C (Fee Program) 011\WP50\DEC\IRVINE\REI.004 9 03/13/90 2:21pm EXHIBIT D (Contents of Plans) 011\WP50\DEC\IRVINE\REI.004 10 03/13/90 2:21pm