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Home My WebLink AboutCC 8 TRAFFIC SIG IMPROV 7-2-90DATE: TO: FROM: JUNE 22, 1990 WILLIAM HUSTON, CITY MANAGER "NSENT CALENDAR NO. 8 7/2/90 Inter - Com PUBLIC WORKS DEPARTMENT/ENGINEERING DIVISION SUBJECT: TRAFFIC SIGNAL IMPROVEMENT PROJECTS CONTRACT RECOMMENDATION: That the Tustin City Council at their meeting of July 2, 1990 approve the Escrow Agreement for Escrow Deposits in Lieu of Retention for the Traffic Signal Improvement Projects at Main Street and Stoneglass, Main Street and E1 Camino Real,and Walnut Avenue and Franklin Avenue and authorize the Mayor to execute said agreement. BACKGROUND: The contractor for the Traffic Signal Improvement Projects at Main Street and Stoneglass, Main Street and E1 Camino Real, and Walnut Avenue and Franklin Avenue, Intersection Maintenance Service, has requested an escrow account be set up as a substitute for the retention earnings required to be withheld by the City pursuant to the construction contract entered into between the City and the Contractor. These retention monies amount to 10% of the total monies earned by the Contractor for the duration of the contract. Section 22300 of the Public Contracts Code of the State of California provides the Contractor the option to deposit securities with an Escrow Agent as a substitute for the above-mentioned retention earnings. The market value of the securities at the time of substitution shall be at least equal to the cash amount then required to be withheld as retention. This procedure/escrow account then allows the City to make payments directly to the Contractor which otherwise would have been withheld. The City Attorney's office has been indicated that Section 22300 of the Public Contracts Code requires the City to participate in this procedure once the Contractor has requested said action. DISCUSSION: The attached Escrow Agreement has been reviewed by the City Attorney's office and provides for the following: 1. California Republic Bank, Trust Financial Services, P.O. Box 2468, Bakersfield, CA 93303, to be designated as "Escrow Agent". 2. Contractor is responsible for all fees and expenses incurred by the Escrow Agent in administering the escrow account. 3. Interest earned on securities or money market accounts held in escrow shall be for the sole account of the Contractor. 4. City shall control the withdrawal of any part of the principal of the escrow account until the account is no longer required and closed at i TRAFFIC SIGNAL IMPROVEMENT PROJECTS CONTRACT JUNE 22, 1990 PAGE 2 the completion of the project and the acceptance of the project by the City. 5. City maintains the right to draw upon the securities in the event of default on the contract by the Contractor. The attached agreement is presented for the City Council's review, approval, and execution by the Mayor. 4�� 01 C-zz� Bob Ledendecker Director of Public Works/City Engineer BL:mv ESCROW AGREEMENT FOR ESCROW DEPOSITS IN LIEU OF RETENTION THIS ESCROW AGREEMENT is made arid entered into on 1990, by and between the CITY OF TUSTIN whose address is 300 CENTENNIAL WAY, TUSTIN, CALIFORNIA 92680, hereinafter called "Owner," INTERSECTION MAINTENANCE SERVICE, whose address is 244 E. AVENUt� K-4, LANCASTER, CALIFORNIA 935351 hereinafter called "Contractor," and CALIFORNIA REPUBLIC BANK, whose address is P.O. BOX 2468, BAKERSFIELD, CALIFORNIA, 93303, hereina t ter called "Escrow Agent". For the consideration here ina f ter set forth, the Owner, Contractor, and Escrow Agent agree as follows: (1) Pursuant to Section 2210 of the Public Contract Code of the State of California, Contractor has the option to deposit securities with Escrow Agent as a substitute for retention earnings required to be withheld by Owner pursuant to the Construction Contract entered into between the Owner and Contractor for the TRAFFIC SIGNAL IMPROVEMENT AT MAIN S'T'REET AND STONEYGLASS, MAIN STREET AND EL CAMINO REAL, AND WALNUT AVENUE AND FRANKLIN AVENUE in the amount of ONE HUNDRED FORTY FIVE THOUSAND DOLLARS ($ 145, 000.00) dated �VIARCH 5, 1990 (hereinafter referred to as the "Contract") . 4hen the Contractor deposits the securities as a substitute for Contract earnings, the Escrow Agent shall notify the owner within ten days of the deposit. The market value of the securities at the time of the substitution shall be at least equal to the cash amount then required to be withheld as retention under the terms of the Contract between the Owner and Contractor. Securities shall be held in the name of the CITY OF TUSTIN, and shall designate the Contractor as the beneficial owner. (2) The Owner shall ini ke progress payments to the Contractor for such funds which otherwise would be withheld from progress payments pursuant to the Contract provisions, provided that the Escrow Agent holds securities in the form and amount specified above. (3) Alternatively, the Owner may make payments directly to Escrow Agent in the amount o t retention for the benefit of the Owner until such time as the escrow created hereunder is terinina ted. (4) Contractor shall be responsible for paying all fees for the expenses incurred by Escrow Agent in administering the escrow account. These expenses and payment terms shall be determined by the Contractor and Escrow Agent. -1- (5) The interest earned on the securities or the money market accounts held in escrow and all interest earned on that interest shall be for the sole account oL Contractor and shall be subject to wi thdrawa L by Contractor a t any time and Crom time to Lime without notice to the 0'wner. (6) Contractor shall have the right to withdraw all or any p -art of the principal in the Escrow Account only by written notice to Escrow Agent accompanied by written authorization from Owner_ to the Escrow Agent that Owner consen is to the withdrawal of the amount sought to be withdrawn by Contractor. (7) The Owner shall have a right to draw upon the securities in the event oL deL:ault by the Contractor. Upon seven days written notic(-� to the Escrow Agent frorn the Oviner of the default, the Escrow Agent shall immediately convert the securities to cash and shall distribute the cash as instructed by the Owner. (8) Upon receipt of written notification from the Owner certifying that the Contract is final and completer and that the Contractor has complied with all requirements and procedures applicable to the Contract, Escrow Agent shall release to Contractor all securities arid interest on deposit less escrow fees and charges of the Escrow Account. The escrow shall be closed immediately upon disbursement of all monies on deposit and payments of fees and charges. (9) Escrow Agent shall r_eLy on the written notifications from the Owner and the Contractor pursuant to Sections (3) to (6), inclusive, of this agreement and the Owner and Contractor shall hold Escrow Agent harmless from Escrow Agent's release and disbursement oL the principal and interest as set forth above. (10) The names of the persons who are authorized to give written notice or to receive written notice on behalf of the Owner and on behalf of Contractor in connection with the foregoing, and exemplars of their r_,�!spective signatures are as follows: On behalf oL the Owner: On behalf oL the Contractor: PRESIDENT Tit 1 e -_-- BRENDA A. PAXIN Name __------- Name V Signature Signature INTERSECTION MAINTENANCE CITY OF TUSTIN SEKV.[CE 300 CENTENNIAL NAY 244 E. AVENUE K-4 TUSTIN, CA 92680-- LANCASiERr CA92803Y- Address Address -2- On behalf of the Escrow Agent: Senior Vice President CALIFORNIA REPUBLIC BANK "T'RUS'T FINANCIAL SERVICES P.O. BOX 2468 BAKERSFIELD, CA 93303 Address �-- ~------ At the time the Escrow Account is opened, the Owner and Contractor shaLl deliver_ to the Escrow Agent a fully executed counterpart of this Agreement. IN WITNESS WHEREOF, the parties hava executed this Agreement by their proper officers on the date first set forth above. CITY OE' `TUSTIN By------ ---- -- -- "Owner" INTERSECTION MAINTENANCE SERVICE; BRENDA A. PAXIN, PRESIDENT Ti tle -3- "Contractor" ACCEPTANCE California Republic Bank, named as the Escrow Agent above, hereby accepts the Loregoin(J, reserving the right, to ue exercised by its diving thirty (30) days written notice to the Owner and the Contractor, to resign as Escrow Agent. Upon California Republic Bank's giving notice of resignation, the Owner and the Contractor shall jointly designate a new Escrow Agent to act hereunder and give written notice thereof to California Republic Bank. Upon receipt oL such written notice, California Republic i3ank shall deliver all property held hereunder to such new Escrow Agent. California kepubl is Bank shall continue to act as Escrow Agent until receipt of such written notice designating the neer Escrow Agent, provided that in the event such written designation is not made within fifteen (15) days after the expiration oL its thirty (30) day notice of resignation, California Republic Bank may, at any time thereafter, file an interpleading action in Kern County Superior Court interpleading all property it holds as the Escrow Agent. Escrow Account # 80-0025-02 -4- CA jl1�0-RNIIC HANK By .,.- �' nig ice esident By Financial Service Officer