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Home My WebLink AboutHA32321 - AMND - Property Management Svcs HA32321 PALM DESERT HOUSING AUTHORITY STAFF REPORT REQUEST: APPROVAL OF AN AMENDMENT TO THE AGREEMENT FOR PROPERTY MANAGEMENT SERVICES BETWEEN THE PALM DESERT HOUSING AUTHORITY AND RAY, DOUGLAS, ANN AND PATRICK, INC., A.K.A. RPM COMPANY SUBMITTED BY: Janet M. Moore, Director of Housing DATE: June 12, 2014 CONTENTS: Amendment to the Agreement for Property Management Services Letter dated February 17, 2014 from RPM Company Recommendation By Minute Motion that the Housing Authority: 1) Approve the Amendment ("AmendmenY') to the Agreement for Property Management Services ("Agreement") with Ray, Douglas, Ann, and Patrick, Inc., a.k.a. RPM Company, effective January 1, 2015, at no increase in management fees; 2) Authorize the Executive Director to finalize the Amendment. Commission Recommendation The Housing Commission has reviewed the recommendation at its regularly scheduled meeting of May 14, 2014. The Housing Commission recommended approval of the Amendment to the Agreement for Property Management Services. Executive Summary Authority approval will authorize an extension to the Agreement with RPM Company for an additional 24 months, beginning January 1, 2015 with no increase to the current per door management fee of $35.00 per month. RPM provides the day-to-day management and operation of the properties, including but not limited to, record keeping, leasing, overall maintenance and repairs. Pursuant to Section 28-b of the Agreement the parties shall initiate negotiations at least ninety (90) days prior to the termination for a new agreement for Property Management Services. The existing agreement terminates on December 31, 2014. Discussion The property manager is responsible for day-to-day management of the properties identified in the agreement. The property operations are subject to visual inspections, annual audits, property performance analysis and tenant surveys. HA32321 Staff Report RPM Management Agreement June 12, 2014 Page 2 of 2 The Housing Authority properties continue to be well maintained and operate within budget even with the constraints and uncertainty of the elimination of redevelopment in February 2012. The management fee will not increase for the extended contract period. The fee will remain at $35.00 per door per month. Based on the current property portfolio the annual fee for services is approximately $430,000. This amount will fluctuate based on downed units, vacancy and rehabilitations. The Authority's management requirements are unique in that they include the Authority's rent structures, certification, compliance with the Stipulated Judgment, and now the new requirements with the elimination of redevelopment. RPM's management staff is local and provides tenants face-to-face interaction during income qualification and recertification. Staff believes that this provides a more stable population because the tenants are familiar with the managers and vice-versa. The consistency of management at the properties also provides a sense of reliability to both the tenants and the Authority. This Agreement will extend their contract for an additional 2 year period which is in compliance with existing tax laws applicable to the bond issues used to purchase the properties. Staff recommends approval of the Amendment to the Agreement for Property Management Services by and between the Palm Desert Housing Authority and Ray, Douglas, Ann, and Patrick, Inc., a.k.a. RPM Company, effective January 1, 2015. Fiscal Analvsis The fiscal impact of the extension is the same as the current impact as the management fee is not increasing with this extension. Submitted by: _ ,,, , ,,-' _� m P.�� Hc�� c�� —C.%� � �� r�..�....�., ' z'�`� Jane M. Moore, Director of Housing "'"�"'�° l��i�Fc�� 3Y: �" r� Approval: �!'e�6C1�! �s� �il� ��,� �Rty �f�� !�#�� '�ts' �i2�1,�ktrniK,,s��e%�c1.��r, � 7�anne J �va� .� �/�� Paul S. Gibson, Di ector of Finance Joh M. Wohlmuth, Executive Director ;pl G:\HOUSING\RENTAL\RPM\MANAGEMENT CONTRACll2013-2014\SR for amendmenl lo eMend RPM Agreement to 12-31-16.docx HA32321 AMENDMENT TO AGREEMENT FOR PROPERTY MANAGEMENT SERVICES THIS AMENDMENT ("Amendment") to the AGREEMENT FOR PROPERTY MANAGEMENT SERVICES (the "AgreemenY') is made as of, January 1, 2015, ("Effective Date") by and between the PALM DESERT HOUSING AUTHORITY, a public body, corporate and politic having a principal place of business at 73-510 Fred Waring Drive, Palm Desert, California, (the "Authority") and RAY, DOUGLAS, ANN & PATRICK, INC., a California corporation, dba RPM Company Apartment Management Services, having a principal place of business at 1420 S. Mills, Suite M, Lodi, California 95242 (the "Manager"). The Authority and the Manager may be referred to herein individually as a "Party" and collectively as the "Parties." RECITALS A. The Authority is a public body, corporate and politic. B. The Manager is engaged in the business of managing, maintaining, repairing, operating and leasing apartment buildings, and has represented to the Agency that the Manager is experienced and competent in said business. C. The Authority and Manager desire to enter into this Amendment to the Agreement. D. The Parties entered into that certain Agreement for Property Management Services by and between Palm Desert Housing Authority and RPM Company dated January 1, 2013 ("AgreemenY'). NOW, THEREFORE, the Parties agree to amend the Agreement as follows: 1. Term. The parties agree that the term ("Term") of the Agreement shall be extended, beginning January 1, 2015 for an additional twenty four.(24) month term, and ending December 31, 2016 or upon written notice by either party in accordance with the provisions of Section 28 in the Agreement. (Amends Section 6 of the Agreement as of the Effective Date). All other terms of the Agreement to remain unchanged and in full force and effect. IN WITNESS THEREOF, the Parties have executed this First Amendment on the date first above written. Manager: Authority: RAY, DOUGLAS, ANN & PATRICK, INC., PALM DESERT HOUSING AUTHORITY, a a California corporation, dba RPM Company public body, corporate and politic By: Title: By: Title: Executive Director By: ATTEST: Title: Rachelle D. Klassen, Secretary � COMPANY apartment management services 1�ECEII/�D February 17, 2014 �c` � o ��-'S`` CITY OF PALM DESERI" Ms.lanet Moore—Director of Housing �ousir�g Department Palm Desert Housing Authority 73-510 Fred Waring Drive Palm Desert, California 92260-2578 Via: U.S. Mail & E-mail RE: Property Management Contract HA28381— Renewal Dear Ms. Moore: I am writing you today regarding the Property Management contract HA28381; which term is ending December 31, 2014. As listed in Section 28 (b), at least 90 days prior to the contract term ending, the parties shall initiate negotiations for a new agreement. RPM Company herein offers to extend the contract for an additional term of 24 months under the current terms of the existing contract. Under the continued current economic environment, we understand that with this offer we continue to partner with the Housing Authority of the City of Palm Desert to maintain the costs of managing the Palm Desert Authorities affordable housing communities. We appreciate your consideration of this offer. Please do not hesitate to contact me with any questions. Respectfull , Donnie R. Garibaldi President/CEO Cc: Teresa Vakili—Regional Vice President Marilyn M. Mack-Controller LIVE THE DIFFERENCE HEADQUARTERS 1420 south mills ave., suite m • lodi, california 95242 209-333-3400 • fax 209-333-3430