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HomeMy WebLinkAboutPW Fire Station 57 Construction Project____________________________________________________________________________________ FOR CITY CLERK ONLY File No.: 4-13-37 Council Meeting: 12/3/2018 Disposition: Resolution No. 14611 Agenda Item No: 4.m Meeting Date: December 3, 2018 SAN RAFAEL CITY COUNCIL AGENDA REPORT Department: Public Works Prepared by: Lisa Goldfien, Asst. City Attorney Bill Guerin, Public Works Director City Manager Approval: _____ _________ TOPIC: FIRE STATION 57 CONSTRUCTION PROJECT SUBJECT: RESOLUTION APPROVING A FIRST AMENDMENT TO LEASE AGREEMENT BETWEEN THE COUNTY OF MARIN, COUNTY SERVICE AREA 19, AND THE CITY OF SAN RAFAEL CONCERNING FIRE STATION 57 AT 3535 CIVIC CENTER DRIVE RECOMMENDATION: Adopt a resolution approving the First Amendment to the Lease Agreement between the County of Marin, County Service Area 19, and the City of San Rafael concerning Fire Station 57 at 3535 Civic Center Drive. BACKGROUND: The County of Marin, County Service Area 19 (“CSA 19”), and the City of San Rafael have worked together since 1976 to provide fire protection services to a number of unincorporated areas within CSA 19 that are contiguous to the City of San Rafael (Santa Venetia, Los Ranchitos, Country Club, Bayside Acres and California Park). As part of an agreement in 1976, the County leased the land at 3535 Civic Center Drive to the City for a 30-year term, at an annual cost to the City of $1. The City constructed Fire Station 57 on the property, with the County contributing $85,000 to the construction, which was one half of the cost. In 2006, the County, CSA 19, and the City entered into a new 10-year lease under which the City paid market value to lease the land where Fire Station 57 is located, and the City was compensated by the County and CSA 19 for fire protection services provided to unincorporated areas. In 2016, the County, the City, and CSA 19 entered into a new lease of the land at Fire Station 57 (“Lease Agreement”). In view of the City’s decision to build a new Fire Station 57 at 3535 Civic Center Drive, one of the terms of the Lease Agreement was for a contribution to the costs of that project by CSA 19. At the time the Lease Agreement was negotiated, the project costs were estimated to be $12 million. CSA 19 agreed to contribute 46 percent (46%) of the project costs, not to exceed $5,520,000, and the City agreed to pay 54 percent (54%) of the costs plus all expenses in excess of $12 million. The City is now in the process of constructing new Fire Station 57. SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2 ANALYSIS: During construction of Fire Station 57, the City’s contractor encountered unforeseen site conditions that have caused the total costs of the project to increase by a projected $1,425,000. In recognition and furtherance of their ongoing partnership with the City, and of their desire to work together to ensure timely completion of Fire Station 57 for the benefit of all, the County of Marin and CSA 19 have agreed to contribute additional funds towards the increased project costs. Since the Lease Agreement provides for CSA 19 to pay 46 percent (46%) of the total project costs for Fire Station 57, the County/CSA 19 are willing to pay 46 percent (46%) of the increased costs, or an additional $655,500. Staff recommends that the City Council adopt the attached resolution approving a First Amendment to the Lease Agreement that memorializes this agreement. The First Amendment is attached as an exhibit to the resolution. The First Amendment will also require approval by the County Board of Supervisors at one of its next meetings. FISCAL IMPACT: Approval of the First Amendment to Lease Agreement by all parties will result in a payment by the County/CSA 19 of up to an additional $655,500 towards the Fire Station 57 project if total project costs increase by at least $1,425,000. OPTIONS: The City Council has the following options to consider on this matter: 1.Adopt the resolution approving the First Amendment to Lease Agreement as presented. 2.Adopt the resolution with modifications. 3.Direct staff to return with more information. 4.Take no action. RECOMMENDED ACTION: Adopt the resolution approving the First Amendment to Lease Agreement between the County of Marin, County Service Area 19, and the City of San Rafael. ATTACHMENTS: 1.Resolution 2.Exhibit A to Resolution: First Amendment to Lease Agreement 1 RESOLUTION NO. 14611 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL APPROVING A FIRST AMENDMENT TO LEASE AGREEMENT BETWEEN THE COUNTY OF MARIN, COUNTY SERVICE AREA 19, AND THE CITY OF SAN RAFAEL CONCERNING FIRE STATION 57 AT 3535 CIVIC CENTER DRIVE WHEREAS, since 1976, the City of San Rafael, the County of Marin and County Service Area 19 of the County of Marin (“CSA 19”) have cooperated in the provision of fire services to a number of unincorporated areas within CSA 19 that are contiguous to the City of San Rafael (Santa Venetia, Los Ranchitos, Country Club, Bayside Acres and California Park), through the County’s lease of County-owned property at 3535 Civic Center Drive (the “Property”) to the City, and the City’s construction and operation of a fire station on the Property (“Fire Station 57”) with monetary contributions by CSA 19; and WHEREAS, the Essential Facilities Strategic Plan adopted by the City Council on July 20, 2015 provides for the construction of a new Fire Station 57 on the Property; and WHEREAS, the current lease agreement for the Property, entered into on June 21, 2016 between the County of Marin, CSA 19 and the City of San Rafael (hereafter the “Lease Agreement”) provides that the City will pay the County rent for the Property and will construct a new Fire Station 57 on the Property, and that CSA 19 will make a contribution to the City’s costs of the construction project; and WHEREAS, the Lease Agreement estimated the total project costs for the construction of new Fire Station 57 to be $12.0 million, and provides for the City to bear 54.0% of the project costs and all project costs in excess of $12.0 million, and for CSA to bear 46.0% of the project costs, not to exceed $5,520,000; and WHEREAS, the City is now in the process of constructing new Fire Station 57; and WHEREAS, during construction the City encountered unexpected site conditions at the Property that required additional City construction costs, which also delayed the Fire Station 57 construction project; and WHEREAS, the total additional costs of the project are estimated to total at least $1,425,000; and WHEREAS, in recognition and furtherance of their ongoing partnership, the City of San Rafael, the County of Marin and CSA 19 desire to work together to ensure timely completion of Fire Station 57 for their mutual benefit and to share in the additional project costs, and wish to memorialize their agreement in an amendment to the Lease Agreement; NOW THEREFORE, BE IT RESOLVED by the San Rafael City Council that the Mayor is hereby authorized to execute, on behalf of the City, the “First Amendment to Lease Agreement” attached hereto as Exhibit A, subject to final approval as to form by the City Attorney; 2 BE IT FURTHER RESOLVED, that the City Manager is authorized to take such other and further actions as he deems necessary to implement the executed First Amendment to Lease Agreement. I, LINDSAY LARA, City Clerk of the City of San Rafael, hereby certify that this Resolution was duly and regularly introduced and adopted at a regular meeting of said City Council held on the 3rd day of December 2018 by the following vote, to wit: AYES: COUNCILMEMBERS: Colin, Gamblin, McCullough & Mayor Phillips NOES: COUNCILMEMBERS: None ABSENT: COUNCILMEMBERS: Bushey ____________________________ LINDSAY LARA, City Clerk FIRST AMENDMENT TO LEASE AGREEMENT THIS FIRST AMENDMENT TO LEASE AGREEMENT (First Amendment), is made and entered into this j day of December 2018, by and between the COUNTY OF MARIN, hereinafter referred to as "COUNTY", COUNTY SERVICE AREA 19 OF THE COUNTY OF MARFN, hereinafter referred to as "CSA", and the CITY OF SAN RAFAEL, hereinafter referred to as "CITY". WHEREAS, the parties entered into a Lease Agreement dated June 21, 2016 (Lease) for the property where Fire Station #57 is located, more fully described in Paragraph 4 of the Lease Agreement (Property); WHEREAS, CITY is in the process of constructing a new Fire Station #57 on the Property (the `'Project"); WHEREAS, pursuant to Paragraph 1 of the Lease, the total project costs were estimated to be $12.0 million, with CITY to bear 54.0% of the project costs and all project costs in excess of $12.0 million, and CSA to bear 46.0% of the project costs, not to exceed $5,520,000; and WHEREAS, during construction CITY encountered unexpected site conditions at the Property owned by County as lessor that required additional City construction costs, which also delayed the Project; WHEREAS, the total additional costs of said Project are estimated to total at least $1,425,000; WHEREAS, the parties desire to work together to ensure timely completion of Fire Station 457 for mutual benefit and share in said additional costs. NOW THEREFORE, it is mutually agreed that the Lease shall be amended as follows: 1. Paragraph 1 of the Lease shall be amended to increase the total estimated project budget from $12.0 million to $13,425,000 to reflect the unanticipated additional project costs; to increase the cap on the CSA's contribution from $5,520,000 to $6,175,500, and to reflect that CITY shall bear all project costs in excess of $13,425,000. 2. Except as expressly modified by this First Amendment, all other terms and conditions of the Lease, not specifically modified, amended or superseded herein, shall continue in full force and effect. q-13 -31 IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to be executed by their duly authorized agents on the day and year first written above. CITY OF SAN RAFAEL ATTEST: c7 -- LINDSAY - LINDSAY LARA, City Clerk APPROVED AS TO FORM: L. j -a �- � - L Ax ROBERT F. EPSTEIN, `ity Attorney 2 COUNTY OF MARIN and COUNTY SERVICE AREA 19 President of the Board of Supervisors ATTEST: County Cleric APPROVED AS TO FORM: BRIAN WASHINGTON, County Counsel JENNA BRADY, Deputy County Counsel SETTLEMENT AGREEMENT AND RELEASE BETWEEN COUNTY OF MARIN, COUNTY SERVICE AREA 19, AND CITY OF SAN RAFAEL THIS SETTLEMENT AGREEMENT AND RELEASE (Agreement), is made and entered into this S day of December, 2018, by and between the COUNTY OF MARIN, hereinafter referred to as "COUNTY", COUNTY SERVICE AREA 19 OF THE COUNTY OF MARIN, hereinafter referred to as "CSA", and the CITY OF SAN RAFAEL, hereinafter referred to as "CITY". WHEREAS, the parties entered into a Lease Agreement dated June 21, 2016 (Lease Agreement) for the property where Fire Station #57 is located, more fully described in Paragraph 4 of the Lease Agreement (Property); WHEREAS, the Lease Agreement provides that CITY shall be responsible for the disposal of any hazardous materials placed on the Property by CITY or CITY's agents and that COUNTY shall be responsible for any other hazardous materials found on the Property; WHEREAS, CITY is in the process of constructing a new Fire Station #57 on the Property; WHEREAS, during construction CITY encountered unexpected site conditions that included inadequate soil conditions at the Property; WHEREAS, CITY estimates that the cost related to these unexpected site conditions, including site preparation and costs relating to delay, total approximately $1,425,000; and WHEREAS, the parties desire to work together to resolve this issue and ensure timely tD completion of Fire Station #57; NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL COVENANTS AND CONDITIONS CONTAINED HEREIN, the parties hereto do agree as follows: I . COUNTY, by and through the CSA, shall increase the cap of $5,520,000 set forth in Paragraph I .D of the Lease Agreement by $655,500 for a new cap of $6,175,500 to contribute to the increased cost of the project due to soil conditions at the Property. The parties will reflect the increased cap through an amendment to the Lease Agreement, and COUNTY may request documentation or certification by City that City has incurred and paid additional and unexpected project costs, causing said project to total at least $13,425,000. 2. The parties understand and agree that the COUNTY's payment of any amounts pursuant to this Agreement are not to be construed as an admission of liability by COUNTY, its employees, agents or servants, by whom liability is expressly denied. I CITY agrees that for and in consideration of COUNTY's increased contribution to the project pursuant to Paragraph 1 of this Agreement that CITY does hereby release, acquit and forever discharge COUNTY and CSA and its agents, servants and employees from any and all actions, causes of action, claims, demands, damages, costs, expenses, and compensation, on account of, or in any way growing out of, any and all known and unknown damages resulting or alleged to result from any and every aspect of the soil conditions at the Property that were discovered and remediated by CITY in 2017, including, but not limited to, costs related to removal of the soil, delays, consulting, administration, testing and/or attorneys' fees. 4. In entering into this Agreement, and the release provided for herein, CITY expressly acknowledges and agrees that the release contained in this Agreement includes a waiver of all rights under Section 1542 of the California Civil Code. California Civil Code Section 1542 provides: A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR. CITY acknowledges that there is a risk that the damages it believes it has suffered, the claims it believes it holds, and other facts upon which it may be relying in entering into this Agreement, may later turn out to be other than, or different from, those now known, suspected or believed to be true. CITY acknowledges that in entering into this settlement and the release provided for in this Agreement, CITY expressly agrees to accept the risk of such possible unknown damages, claims, demands, actions, causes of action or issues of fact related to the soil conditions at the Property that were discovered and remediated by CITY in 2017, which the parties agree shall not include any fixture soil conditions discovered at the Property unrelated to the 2017 soil conditions that are subject to Section 13 of the Lease Agreement. CITY acknowledges, represents and warrants that in waiving all rights or benefits which any of it may have had under California Civil Code Section 1542, it has had the advice of counsel, and it further represents, warrants and agrees that this Agreement shall remain in frill force and effect, notwithstanding the occurrence of any such possible changes or differences in material fact. 7 5. Except as expressly set forth herein, CITY and COUNTY agree that nothing contained in this Agreement alters or amends the terms of the Section 13 of the Lease Agreement entitled "Hazardous Materials" or the respective rights and obligations of the parties pursuant thereto. IN WITNESS WHEREOF, the parties have executed and delivered this Agreement consisting of 3 pages, including signatures. Dated: _ 11,1 S 2 01 CITY ( Dated: COUNTY OF MARIN LOIN Damon Connolly, President Board of Supervisors APPROVED AS TO FORM: Dated: By: Robert F. Epstein, San)kafael ity Attorney Dated: By: Jenna Brady, Deputy County Counsel County of Marin 3