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HomeMy WebLinkAboutC23340 Munifinancial - Formation of Assessment District (Section 29)Contract No. C23340 CITY OF PALM DESERT STAFF REPORT REQUEST: APPROVAL OF AN AGREEMENT FOR PROFESSIONAL SERVICES WITH MUNIFINANCIAL IN CONNECTION WITH THE FORMATION OF AN ASSESSMENT DISTRICT (SECTION 29) SUBMITTED BY: DENNIS M. COLEMAN, REDEVELOPMENT/HOUSING FINANCE MANAGER DATE: JANUARY 27, 2005 CONTENTS: AGREEMENT WITH MUNIFINANCIAL FOR PROFESSIONAL SERVICES Recommendation: That the City Council, by minute motion: 1) Approve the agreement with MuniFinancial for professional services in connection with the formation of an assessment district (Section 29) in an amount not -to -exceed $44,000; and 2) Authorize the Mayor to execute the agreement. Funds are available in Account No. 610-0000-228-2100. Executive Summary Approval and execution of this agreement allows for the necessary step for the property owners to vote on the formation of the assessment district for public improvements. Discussion: On November 18, 2004, the City Council approved the Deposit and Reimbursement Agreement with Ponderosa Homes II, Inc. for the reimbursement of costs associated with the formation of an assessment district for construction of public improvements. The District is located in a northwest section of the City with Monterey Avenue to the west, Gerald Ford Drive to the south, Portola Avenue to the east, and Avenue 35 to the north. The proposed District is approximately 300 acres and includes five property owners. The proposed District includes property owned by the Macloed Family Trust, Lowes G:1RDA1Dennis Coleman\DATA\WP\REPORTS1012705 munifin sec 29 cc.wpd Contract No. C2334O Staff Report Approval of an Agreement to Provide Professional Services with MuniFinancial Page 2 January 27, 2005 Corporation, The Sares-Regis Group, Rillington Communities, and Ponderosa Homes II, Inc., and the Noble Company. The public improvements to be funded by the District include street improvements on Monterey Avenue, Gerald Ford Drive, Gateway Drive, Dinah Shore, Portola and others. The District will also fund storm drain improvements, water main improvements, sewer improvements, and will relocate utility poles. Staff solicited a proposal from MuniFinancial to provide the district formation services, including the Assessment Engineer's Report, the assessment district maps and diagrams, and the Proposition 218 balloting services. Staff has received an agreement for services which is not -to -exceed $44,000. The agreement will be paid from the $50,000 deposit the Ponderosa Homes II, Inc. has given to the City that has been placed in trust to be used for purposes such as this. Staff is recommending that the City Council approve the agreement with MuniFinancial and authorize the Mayor to execute it. Submitted By: Dennis M. Coleman Redevelopment Finance Manager DMC:mh Approval: Carlos . 1 rteg City Manager G:1RDA1Dennis ColemanlDATA\WPIREPORTS1012705 munifin sec 29 cc.wpd Department Head: avid Yrigoyen Director of Re • evelopment Paul S. Gibson Director of Finance/Treasurer Contract NO. C23340 AGREEMENT FOR PROFESSIONAL SERVICES THIS AGREEMENT, made and entered into this 30th day of December 2004, by and between MuniFinancial, a corporation, and the City of Palm Desert, hereinafter referred to as "Client." WHEREAS, Client desires to employ MuniFinancial to furnish ongoing professional services in connection with Local Improvement District Formation Services, hereinafter referred to as the "Project." NOW, THEREFORE, in consideration of the mutual premises, covenants and conditions herein contained, the parties agree as follows: SECTION I - BASIC SERVICES MuniFinancial shall provide to the Client the basic services described in detail in Exhibit "A," Scope of Services, attached hereto and incorporated herein by this reference. SECTION II - ADDITIONAL SERVICES If authorized, MuniFinancial shall furnish additional services, which are in addition to the basic services. To the extent that the additional services have been identified in this Agreement, they are itemized in Exhibit "A" and will be paid for by Client as indicated in Section III hereof. As further additional services are requested by Client, this Agreement may be modified and subject to mutual consent by execution of an addendum by authorized representatives of both parties, setting forth the additional scope of services to be performed, the performance time schedule and the compensation for such services. SECTION III - COMPENSATION MuniFinancial shall be compensated for basic services rendered under Section I, as in accordance with the terms and conditions indicated in Exhibit "B," Fees for Services; and MuniFinancial will be compensated for any additional services rendered under Section II as more particularly described in a fully approved and executed addendum to this Agreement. If no addendum is executed, then MuniFinancial shall be compensated at its then -prevailing hourly rates for such additional services. MuniFinancial may submit monthly statements for basic and additional services rendered. It is intended that Client will make payments to MuniFinancial within thirty (30) days of invoice. All invoices not paid within thirty (30) days shall bear interest at the rate of 1-1/2 percent per month or the then legal rate allowed. MurFinancial Page 1 City of Palm Desert Contract No. C23340 SECTION IV - INDEMNITY; INSURANCE REQUIRED A. Indemnity. MuniFinancial shall indemnify and hold harmless Client, its officers, officials, directors, employees, designated agents, and appointed volunteers from and against all claims, damages, losses and expenses, including attorney fees, arising out of the performance of the services described herein, caused in whole or in part by the negligent acts, errors or omissions of MuniFinancial, any subconsultant, anyone directly or indirectly employed by any of them or anyone for whose acts any of them may be liable, except where caused by the active negligence or willful misconduct of Client or Client's officers, agents or employees. B. Insurance. Without in any way limiting MuniFinancial's liability pursuant to the indemnification described above, MuniFinancial shall maintain, during the term of this contract, the following insurance: Coverage Minimum Limits General Liability Comprehensive General Liability, including: Premises and Operations Contractual Liability Personal -Injury Liability Independent Contractors Liability (if applicable) Automobile Liability Comprehensive Automobile Liability, (including owned, non -owned and hired autos) Workers' Compensation and Employer's Liability Workers' Compensation Insurance Employer's Liability $1,000,000 Combined Single Limit, per occurrence and general aggregate $1,000,000 Combined Single Limit, per occurrence Statutory, $1,000,000 Professional Liability $1,000,000 per claim and annual aggregate Professional Liability Insurance SECTION V - INDEPENDENT CONTRACTOR STATUS MuniFinancial shall be an independent contractor and shall have responsibility for and control over the details and means of providing the services under this Agreement. MuniFinancial Page 2 City of Palm Desert Contract No. C23340 SECTION VI - OWNERSHIP AND MAINTENANCE OF DOCUMENTS MuniFinancial may rely upon the accuracy of any documents provided to MuniFinancial by Client. All documents, including without limitation, reports, plans, specifications, field data, field notes, laboratory test data, calculations, estimates, schedules, spreadsheets, or other documents furnished by MuniFinancial pursuant to this Agreement, regardless of media (e.g., paper, electronic, magnetic, optical, Mylar, etc), are instruments of MuniFinancial's services in respect to this Project and not products. All such documents shall remain the property of MuniFinancial provided, however, that a copy of the final documents shall be made available to Client upon request. These documents are not intended nor represented to be suitable for reuse by Client or any others on extensions of this Project or on any other project. These documents shall not be changed or reused without the prior written consent of MuniFinancial. Any modification or reuse without specific written verification and adoption by MuniFinancial for the specific purposes intended will be at user's sole risk. Client agrees to save, keep and hold harmless MuniFinancial from all damages, costs or expenses in law and equity including costs of suit and attorneys' fees resulting from such unauthorized reuse. Client further agrees to compensate MuniFinancial for any time spent or expenses incurred by MuniFinancial in defense of any such claim, in accordance with MuniFinancial's prevailing fee schedule. Client acknowledges that its right to utilize the services and instruments of services of MuniFinancial will continue only so long as Client is not in default of the terms and conditions of this agreement and Client has performed all obligations under this agreement. Client further acknowledges that MuniFinancial has the unrestricted right to use the services provided pursuant to this agreement as well as all instruments of service provided pursuant to this agreement. Client agrees not to use or permit any other person to use any instruments of service prepared by MuniFinancial, which are not final and which MuniFinancial does not sign. Client agrees to be liable for any such use of non -final instruments of service not signed, stamped or sealed by MuniFinancial and waives liability against MuniFinancial for their use. MuniFinancial's records, documents, calculations, test information and all other instruments of service shall be kept on file in legible form for a period of not less than two years after completion of the services covered in this Agreement. SECTION VII - SUSPENSION OF SERVICES Client may, at any time, by thirty (30) days' written notice, suspend further performance by MuniFinancial. All suspensions shall extend the tune schedule for performance in a mutually satisfactory manner and MuniFinancial shall be paid for all services performed and reimbursable expenses incurred prior to the suspensions date. MuniFinancial Page 3 City of Palm Desert Contract No. C23340 SECTION VIII - TERMINATION Either party may terminate this Agreement at any time by giving thirty (30) days' written notice to the other party of such termination. If this Agreement is terminated as provided herein, MuniFinancial will be paid an amount which bears the same ratio to the total compensation as the services actually performed bears to the total services of MuniFinancial covered by this Agreement, less payments of compensation previously made. SECTION IX - COMPLIANCE WITH LAW Each party hereto will use reasonable care to comply with applicable laws in effect at the time the services are performed hereunder, which to the best of their knowledge, information and belief apply to their respective obligations under this Agreement. SECTION X - SUCCESSORS AND ASSIGNS This Agreement shall be binding on the successors and assigns of the parties, but either party, without written consent of the other party, shall not assign it. SECTION XI - ATTORNEYS FEES In the event that any judgment is entered in any action upon this Agreement, the party hereto against whom such judgment is rendered agrees to pay the amount equal to the reasonable attorneys fees of the prevailing party in such action and that such amount may be added to and made a part of such judgment. SECTION XII - ALTERNATIVE DISPUTE RESOLUTION If a dispute arises between the parties relating to this Agreement, the parties agree to use the following procedure prior to either party pursuing other available remedies: A. A meeting shall be held promptly between the parties, attended by individuals with decision -making authority regarding the dispute, to attempt in good faith to negotiate a resolution of the dispute. B. If, within thirty (30) days after such meeting, the parties have not succeeded in negotiating a resolution of the dispute, they will jointly appoint a mutually acceptable neutral person not affiliated with either of the parties (the "neutral"), seeking assistance in such regard if they have been unable to agree upon such appointment within forty (40) days from the initial meeting. The parties shall share the fees of the neutral equally. MuniFinancial Page 4 City of Palm Desert Contract No. C23340 C. In consultation with the neutral, the parties will select or devise an alternative dispute resolution procedure ("ADR") by which they will attempt to resolve the dispute, and a time and place for the ADR to be held, with the neutral making the decision as to the procedure, and/or place and time (but unless circumstances require otherwise, not later than sixty (60) days after selection of the neutral) if the parties have been unable to agree on any of such matters within twenty (20) days after initial consultation with the neutral. D. The parties agree to participate in good faith in the ADR to its conclusion as designated by the neutral. If the parties are not successful in resolving the dispute through the ADR, then the parties may agree to submit the matter to binding arbitration or a private adjudicator, or either party may seek an adjudicated resolution through the appropriate court. SECTION XIII - RECORDS Records of MuniFinancial's direct labor costs, payroll costs and reimbursable expenses pertaining to the Project covered by this Agreement will be kept on a generally recognized accounting basis and made available during normal business hours upon reasonable notice. MuniFinancial's records will be available for examination and audit if and as required. SECTION XIV - MISCELLANEOUS PROVISIONS This Agreement is subject to the following special provisions: A. The tides used in this Agreement are for general reference only and are not a part of the Agreement. B. This Agreement shall be interpreted as though prepared by both parties. C. Any provision of this Agreement held to violate any law shall be deemed void, and all remaining provisions shall continue in full force and effect. D. This Agreement shall be interpreted under the laws of the State of California. E. This Agreement comprises a final and complete repository of the understandings between the parties and supersedes all prior or contemporary communications, representations or agreements, whether oral or written, relating to the subject matter of this Agreement. F. Any notices given pursuant to this agreement shall be effective on the third business day after posting by first class mail, postage prepaid, to the address appearing immediately after the signatures below. G. MuniFinancial shall not be liable for damages resulting from the actions or inactions of governmental agencies including, but not limited to, permit processing, environmental impact reports, dedications, general plans and amendments thereto, zoning matters, annexations or consolidations, use or conditional use permits, project or plan approvals, and building permits. MuniFinancial Page 5 City of Palm Desert Contract No. C23340 H. MuniFinancial's waiver of any term, condition, or covenant, or breach of any term, condition, or covenant, shall not constitute the waiver of any subsequent breach of any other term, condition or covenant. I. Client acknowledges that MuniFinancial is not responsible for the performance of services by third parties, provided that said MuniFinancial has not retained third parties. IN WITNESS WHEREOF, the parties hereto have accepted, made and executed this Agreement upon the terms, conditions and provisions above stated, the day and year first above written. MUNIFINANCIAL By: Title: Address: Paul Whitelaw Senior Vice President 27368 Via Industria, Suite 110 Temecula, California 92590-3661 CITY OF PALM DESERT By: Title: Address: Buford A. Crites Mayor 73-510 Fred Waring Drive Palm Desert, California 92260-2578 MuniFinancial Page 6 City of Palm Desert Exhibit A Contract No. C23340 SCOPE OF SERVICES Local Im • rovement District Formation MuniFinancial and Willdan will participate with the project team to provide the following services: District Formation Services Task 1: Kickoff Meeting Attend initial kick-off meeting with City staff and consultants to discuss procedures, responsibilities, and to develop a detailed timeline. Task 2: Data Gathering A. Gather information related to the project from the City, the County Assessor's Office and Auditor/Controller's Office, the financial advisor, and the City's engineer. Information will be gathered through meetings, correspondence, and follow-up phone calls to ensure accuracy and completeness. B. Prepare a detailed parcel database showing Assessor's Parcel Number, assessment number, lot area, front footage, assessed land and structure values, County land use, development status, ownership, property address, mailing address, and any other necessary information. The database will be used to calculate each parcel's assessment amount, and to prepare a mailing list for balloting and notice requirements. Task 3: Report Methodology A. Based on information gathered, prepare a preliminary assessment analysis. The analysis will include assessment rates per land use comparisons, value -to -lien calculations, and overlapping tax analyses. 1. We will prepare an assessment roll and related computations from our database, including: a. Determining the boundary of the district, the Assessor's parcels in the boundary and assigning each parcel an assessment number; b. Identifying the appropriate measurement factors on which to spread the assessment lien and assigning factors to each parcel; c. Computing the assessment lien for each parcel in the district derived from the factors assigned to each parcel and the improvement costs determined to be of special benefit. 2. The assessment methodology will take into consideration the potential of land use, density, and absorption changes from those projected. The assessment methodology proposed will be designed to protect the bonds, as well as fairly assess properties expected to be in the district. B. Prepare an 18-inch by 26-inch assessment diagram that is suitable for recording, as well as in an 8-inch by 11-inch format that will include the following items: 1. Legal parcels that will exist at the time of district formation; 2. The Assessor parcel numbers or tract and lot information for each parcel; 3. The assessment number assigned to each lot, corresponding to the assessment roll; MuniFinancial Page 7 City of Palm Desert Contract No. C23340 Exhibit A 4. If necessary, the distinction between the benefit boundary and the district boundary; and 5. If necessary, the distinction between benefit zones. C. Determine the improvements to be included in the district. This information will be based on input from the City, the City engineer, bond counsel, and our engineering analysis of general and special benefit. Then prepare a narrative description to be included in the Engineer's Report. If required, additional improvement zones will be established and different methodologies can be developed to address the benefit one area receives from improvements or services that another area does not receive. D. Prepare a cost estimate of the improvement items, incidentals and issuance costs related to the district to be included in the Engineer's Report. The project cost estimate, including incidentals, will be coordinated with the City engineer. The bond issuance costs will be discussed with the team to insure all appropriate costs have been included correctly, such as capitalized interest, official statement printing, reserve fund level and any required bond security. E. Based on the boundaries of the district, develop the Method of Assessment, the improvements to be funded, the proposed development, and any effective tax rate limitations. To ensure all considerations have been addressed, the method will be discussed with the project team, and then fmalized for the preliminary and the final Engineer's Reports. The method will be devised to specifically address general benefit; the special benefit that each parcel receives; the special and general benefit ascribed to public agency parcels; and the effect, both financial and political, on the homeowner or secondary property owners. Task 4: Report Preparation A. Compile items from Tasks 2 and 3 above into the preliminary and final Engineer's Reports, and submit five (5) copies each for review and comment to City staff, with additional copies to the financing team. Submit up to ten (10) copies each of the preliminary and final Engineer's Reports to City staff for filing with the City council. If requested, we will present the report to City council and field any questions received at the public hearing. The preliminary and final Engineer's Reports will include the following components: 1. A description of the proposed public facilities to be funded; 2. Plans and specifications (or reference to those on file); 3. A detailed cost estimate of the proposed facilities, including estimates of bond issuance and other incidentals costs; 4. The assessment roll showing Assessor number, parcel identification, and assessment lien; 5. The Method of Assessment; 6. The assessment diagram; 7. The maximum annual administrative add -on assessment; 8. A right-of-way schedule indicating right-of-way still to be acquired (if necessary); and 9. A public property schedule indicating the public property assessed in the district (if necessary). Task 5: Prepare Mailing Prepare the required mailing of the Notice of Public Hearing and Assessment Ballot to the property owners within the district. MuniFinancial Page 8 City of Palm Desert Contract No. C23340 Exhibit A Task 6: Meetings Throughout the formation process, we will attend meetings and participate, as necessary, in conference calls with the City to facilitate in a timely manner the completion of resolutions, the Engineer's Report and, as needed, the official statement to allow for bonds issuance. This includes attending up to ten (10) meetings with City staff, utility coordination and/or citizen workshops, as well as two (2) City council meetings to approve the Resolutions of Intention and the public hearing. Based on our hourly fees (see "Additional Services" section), we will be available to attend additional meetings at the City's request. Post Formation Services If the district is not formed, our services are concluded. If the district is formed, we will notify property owners of their final assessments and prepayment amounts, assist the financing team with data required to fund the improvements, and record necessary documents. Task 1: Recording of Documents Hand -walk the assessment diagram and Notice of Assessment through the City to obtain appropriate signatures and record the documents at the County of Riverside Recorder Office. Task 2: Mailing of Notice Prepare and mail confirmed assessment apportionment and Notice of Assessment to each property owner of record within the district. The notice will serve as the beginning of the 30-day cash collection period and will provide the discounted payoff amount to property owners that wish to pay off their assessment prior to the sale of bonds. We will supply certification stating that this task has been completed. Task 3: Prepare Paid/Unpaid List After the 30-day cash collection period, we will coordinate with the City on any payoffs and prepare the paid and unpaid list of assessments for the finance and final bond documents. Task 4: Prepare Official Statement Tables As necessary, provide information and review the preliminary official statement or state loan documents. Develop data tables for the official statement, including value -to -lien summaries, top owners, development status, and other data required by the financing team. Task 5: Prepare Final Report Prepare a final Engineer's Report that includes any cost savings from those originally estimated and to reflect parcels that paid off their assessments during the 30-day cash collection period. File the final report with the Superintendent of Streets. Task 6: Meetings Participate in up to two (2) meetings with the financing team regarding the financing and issuance of bonds. MuniFinancial Page 9 City of Palm Desert Contract No. C23340 Exhibit A Pro • osition 218 Ballotin • Services Following is our work plan, by task, for the Proposition 218 assessment balloting proceeding for the proposed district. 1. Prepare and mail the legal notice of public hearing and the protest ballots to conform to all current legislation. The legal notice will include the time, date and place of the public hearing and will also serve as an information mailer. The property owner ballots will include the Assessor's parcel number, the property owner and mailing address (or the situs address based on discussions with bond counsel and City staff), the proposed assessment amount broken down by improvement type, the Method of Assessment and the property's specific benefit as required by Proposition 218. 2. Prepare all necessary resolutions regarding the proposed assessment increase that are necessary at the Intent Meeting and the public hearing. 3. Coordinate with the City to tabulate all ballots. We have developed a software program that quickly and accurately tabulates all ballots. Each ballot will include unique barcodes that can be scanned and tabulated within our program. Typically, we can tabulate approximately 500 ballots per hour. Client Res • onsibilities For this project, the City will provide the following: • Complete documentation and data related to the district, including electronic copies of pertinent information. (This may also include the City's assistance in gathering such information from the developers or their consultants.) • Opinions, as requested, from the City Attorney's Office. The City of Palm Desert acknowledges that MuniFinancial shall be relying upon the accuracy of the information provided by the City or their designees and that MuniFinancial shall not be liable for any inaccuracies contained in such information. MuniFinancial Page 10 City of Palm Desert Exhibit B Contract No. C23340 FEES FOR SERVICES Local Im • rovement District Formation MuniFinancial and Willdan will provide assessment -engineering services for the formation of the proposed Section 29 Area Assessment District for the following "not -to -exceed" fees: Assessment District Formation Services Service Fee District Formation Services $ 33,000 Post Formation Services 7,000 Balloting Services 4,000 Total $ 44,000 Manner of Payment Based on hours performed on the project and out-of-pocket expenses incurred, MuniFinancial will bill on a monthly basis. Reimbursable Ex • enses MuniFinancial will be reimbursed, at cost, for out-of-pocket expenses. Examples of reimbursable expenses include, but are not limited to: printing and delivery of any additional Engineer's Reports, travel expenses or expenses related to updated maps or diagrams, postage, mileage (40.5¢ per mile), county maps, electronic data furnished from the County and/or other applicable resources, construction cost periodicals, and copying (currently 6¢ per copy). Any additional expense for reports or from outside services will be billed to the City, at our cost, with no overhead markup. Charges for meeting and consulting with counsel, the City, or other parties regarding services not listed in the scope of work above will be at our then -current hourly rates (see the "Additional Services" section). In the event that a third party requests any documents, MuniFinancial may, in accordance with MuniFinancial's applicable rate schedule, charge such third party for providing these documents. MuniFinancial Page 11 City of Palm Desert Contract No. C23340 Exhibit B Additional Services Additional services may be authorized by the City of Palm Desert and will be billed at our then -current hourly consulting rates. Our hourly rates are: Hourly Rates - Schedule of Fees MuniFinancial's Rates Wilidan's Rates Title Hourly Rate Title Hourly Rate Division Manager $180 Principal Engineer $160 Principal Consultant 145 Division Manager 150 Senior Project Manager 125 Senior Engineer 120 Project Manager 105 Associate Engineer 110 Senior Analyst 85 Senior Designer 105 Analyst 75 Designer 95 Analyst Assistant 65 Design Engineer I 90 Property Owner Services Representative 50 Drafter 1 75 Support Staff 45 Technical Aide 65 MumFinancial Page 12 City of Palm Desert