The URL can be used to link to this page

2020 05 19 HA Special MeetingHOUSING AUTHORITY 1 MAY 19, 2020 SPECIAL MEETING NOTICE AND CALL OF SPECIAL MEETING OF THE LA QUINTA HOUSING AUTHORITY TO THE MEMBERS OF THE LA QUINTA HOUSING AUTHORITY AND TO THE AUTHORITY SECRETARY: NOTICE IS HEREBY GIVEN that a Special Meeting of the La Quinta Housing Authority is hereby called to be held on Tuesday, May 19, 2020, starting at 4:00 p.m.; at La Quinta City Hall located at 78495 Calle Tampico, La Quinta, CA 92253. Pursuant to Executive Orders N-25-20, N- 29-20, N-33-20, and N-35-20, executed by the Governor of California in response to the state of emergency relating to novel coronavirus disease 2019 (COVID-19) and enabling teleconferencing accommodations by suspending or waiving specified provisions in the Ralph M. Brown Act (Government Code § 54950 et seq.), members of the Housing Authority, the Executive Director, Authority Counsel, City Staff, and City Consultants may participate in this special meeting by teleconference. The special meeting is called for the following purpose. CONSENT CALENDAR 1. APPROVE QUARTERLY MEETING MINUTES OF APRIL 21, 2020 2. RECEIVE AND FILE LA QUINTA HOUSING AUTHORITY ANNUAL REPORT FOR FISCAL YEAR 2018/19 PURSUANT TO CALIFORNIA HEALTH AND SAFETY CODE SECTION 34328 3. RECEIVE AND FILE HOUSING SUCCESSOR ANNUAL REPORT FOR FISCAL YEAR 2018/19 REGARDING LOW- AND MODERATE- INCOME HOUSING ASSET FUND PURSUANT TO CALIFORNIA HEALTH AND SAFETY CODE SECTION 34176.1(f) FOR THE LA QUINTA HOUSING AUTHORITY BUSINESS SESSION 1. APPROVE CONTRACT SERVICES AGREEMENT WITH LA QUINTA PALMS REALTY TO PROVIDE RESIDENTIAL PROPERTY MANAGEMENT SERVICES STUDY SESSION 1. DISCUSS FISCAL YEAR 2020/21 PROPOSED HOUSING AUTHORITY BUDGET HOUSING AUTHORITY 2 MAY 19, 2020 SPECIAL MEETING Dated: May 15, 2020 Robert Radi ROBERT RADI, Chairperson Attest: MONIKA RADEVA Housing Authority Secretary DECLARATION OF POSTING I, Monika Radeva, Authority Secretary, do hereby declare that the foregoing notice for the Special La Quinta Housing Authority meeting of May 19, 2020 was posted on the outside entry to the Council Chamber at 78495 Calle Tampico and on the bulletin boards at 51321 Avenida Bermudas and 78630 Highway 111 on May 15, 2020. DATED: May 15, 2020 Monika Radeva, Authority Secretary La Quinta Housing Authority HOUSING AUTHORITY AGENDA 1 MAY 19, 2020 SPECIAL MEETING HOUSING AUTHORITY AGENDA CITY HALL COUNCIL CHAMBER 78495 Calle Tampico La Quinta SPECIAL MEETING TUESDAY, MAY 19, 2020 at 4:00 P.M. ****************************** SPECIAL NOTICE Teleconferencing and Telephonic Accessibility In Effect Pursuant to Executive Orders N-25-20, N-29-20, N-33-20, and N-35-20, executed by the Governor of California in response to the state of emergency relating to novel coronavirus disease 2019 (COVID-19) and enabling teleconferencing accommodations by suspending or waiving specified provisions in the Ralph M. Brown Act (Government Code § 54950 et seq.), members of the Housing Authority, the Executive Director, Authority Counsel, City Staff, and City Consultants may participate in this meeting by teleconference. Additionally, pursuant to the above-referenced executive orders, the public is not permitted to physically attend at City Hall the meeting to which this agenda applies, but any member of the public may listen or participate in the open session of this meeting as specified below. Members of the public wanting to listen to the open session of this meeting may do so by tuning-in live via http://laquinta.12milesout.com/video/live. Members of the public wanting to address the Housing Authority either for public comment or for a specific agenda item, or both, are requested to send an email notification to the La Quinta City Clerk’s Office at CityClerkMail@LaQuintaCA.gov, and specify the following information: Housing Authority agendas and staff reports are available on the City’s web site: www.laquintaca.gov HOUSING AUTHORITY AGENDA 2 MAY 19, 2020 SPECIAL MEETING 1) Full Name 4) Public Comment or Agenda Item Number 2) City of Residence 5) Subject 3) Phone Number 6) Written or Verbal Comments The email “subject line” must clearly state “Written Comments” or “Verbal Comments.” Verbal public comments – requests to speak must be emailed to the Authority Secretary no later than 3:00 p.m. on the day of the meeting; the City will facilitate the ability for a member of the public to be audible to the Housing Authority and general public for the item(s) by contacting him/her via phone and queuing him/her to speak during the discussion. Only one person at a time may speak by telephone and only after being recognized by the Chairperson. Written public comments, received prior to the adjournment of the meeting, will be distributed to the Housing Authority, incorporated into the agenda packet and public record of the meeting, and will not be read during the meeting unless, upon the request of the Chairperson, a brief summary of any public comment is asked to be read, to the extent the City Clerk’s Office can accommodate such request. It would be appreciated that any email communications for public comments related to the items on the agenda, or for general public comment, are provided to the City Clerk’s Office at the email address listed above prior to the commencement of the meeting. If that is not possible, and to accommodate public comments on items that may be added to the agenda after its initial posting or items that are on the agenda, every effort will be made to attempt to review emails received by the City Clerk’s Office during the course of the meeting. The Chairperson will endeavor to take a brief pause before action is taken on any agenda item to allow the Authority Secretary to review emails and share any public comments received during the meeting. All emails received by the Authority Secretary, at the email address above, until the adjournment of the meeting, will be included within the public record relating to the meeting. ****************************** CALL TO ORDER ROLL CALL: Authority Members: Evans, Fitzpatrick, Peña, Sanchez, Chairperson Radi VERBAL ANNOUNCEMENT – AB 23 [AUTHORITY SECRETARY] HOUSING AUTHORITY AGENDA 3 MAY 19, 2020 SPECIAL MEETING PUBLIC COMMENT ON MATTERS NOT ON THE AGENDA At this time, members of the public may address the Housing Authority on any matter not listed on the agenda. Please email written public comments or a request to provide verbal public comments to CityClerkMail@LaQuintaCA.gov and limit your comments to three minutes (approximately 350 words). The Housing Authority values your comments; however, in accordance with State law, no action shall be taken on any item not appearing on the agenda unless it is an emergency item authorized by the Brown Act [Government Code § 54954.2(b)]. CONFIRMATION OF AGENDA CONSENT CALENDAR NOTE: Consent Calendar items are routine in nature and can be approved by one motion. PAGE 1. APPROVE QUARTERLY MEETING MINUTES OF APRIL 21, 2020 5 2. RECEIVE AND FILE LA QUINTA HOUSING AUTHORITY ANNUAL REPORT FOR FISCAL YEAR 2018/19 PURSUANT TO CALIFORNIA HEALTH AND SAFETY CODE SECTION 34328 9 3. RECEIVE AND FILE HOUSING SUCCESSOR ANNUAL REPORT FOR FISCAL YEAR 2018/19 REGARDING LOW- AND MODERATE-INCOME HOUSING ASSET FUND PURSUANT TO CALIFORNIA HEALTH AND SAFETY CODE SECTION 34176.1(f) FOR THE LA QUINTA HOUSING AUTHORITY 25 BUSINESS SESSION PAGE 1. APPROVE CONTRACT SERVICES AGREEMENT WITH LA QUINTA PALMS REALTY TO PROVIDE RESIDENTIAL PROPERTY MANAGEMENT SERVICES 35 STUDY SESSION PAGE 1. DISCUSS FISCAL YEAR 2020/21 PROPOSED HOUSING AUTHORITY BUDGET 71 CHAIR AND BOARD MEMBERS' ITEMS REPORTS AND INFORMATIONAL ITEMS – NONE HOUSING AUTHORITY AGENDA 4 MAY 19, 2020 SPECIAL MEETING ADJOURNMENT *************************************** The next regular quarterly meeting of the Housing Authority will be held on July 21, 2020 at 4:00 p.m. in the City Council Chambers, 78495 Calle Tampico, La Quinta, CA 92253. DECLARATION OF POSTING I, Monika Radeva, Authority Secretary of the La Quinta Housing Authority, do hereby declare that the foregoing agenda for the La Quinta Housing Authority was posted near the entrance to the Council Chambers at 78495 Calle Tampico and on the bulletin boards at 51321 Avenida Bermudas and 78630 Highway 111, on May 15, 2020. DATED: May 15, 2020 MONIKA RADEVA, Authority Secretary La Quinta Housing Authority Public Notices  The La Quinta City Council Chamber is handicapped accessible. If special equipment is needed for the hearing impaired, please call the City Clerk’s Office at (760) 777-7092, twenty-four (24) hours in advance of the meeting and accommodations will be made.  If special electronic equipment is needed to make presentations to the Housing Authority, arrangement should be made in advance by contacting the City Clerk's Office at (760) 777-7092. A one (1) week notice is required.  If background material is to be presented to the Housing Authority during a meeting, please be advised that eight (8) copies of all documents, exhibits, etc., must be supplied to the Authority Secretary for distribution. It is requested that this take place prior to the beginning of the meeting.  Any writings or documents provided to a majority of the Housing Authority regarding any item on this agenda will be made available for public inspection at the Authority Secretary counter at City Hall located at 78495 Calle Tampico, La Quinta, California, 92253, during normal business hours. HOUSING AUTHORITY MINUTES Page 1 of 3 APRIL 21, 2020 QUARTERLY MEETING HOUSING AUTHORITY QUARTERLY MEETING MINUTES TUESDAY, APRIL 21, 2020 CALL TO ORDER A regular quarterly meeting of the La Quinta Housing Authority was called to order at 5:31 p.m. by Chairperson Radi. This meeting was held by teleconference pursuant to Executive orders N-25- 20, N-29-20, N-33-20, and N-35-20, executed by the Governor of California in response to the state of emergency relating to novel coronavirus disease 2019 (COVID-19) and enabling teleconferencing accommodations by suspending or waiving specified provisions of the Ralph M. Brown Act (Government Code § 54950 et seq.). PRESENT: Authority Members: Evans, Fitzpatrick, Peña, Sanchez, and Chairperson Radi STAFF PRESENT: Executive Director McMillen, Authority Counsel Ihrke, Authority Secretary Radeva, Assistant to the City Manager Villalpando, Marketing Specialist Kinley VERBAL ANNOUNCEMENT – AB 23 was made by the Authority Secretary CONFIRMATION OF AGENDA Authority Secretary requested to pull Business Session Item No. 1 from the Agenda as it was included in error, and it was already considered by the Authority at the February 18, 2020 special meeting. The Authority concurred. PUBLIC COMMENT ON MATTERS NOT ON THE AGENDA – None CONSENT CALENDAR – Taken out of Agenda order 1. APPROVE SPECIAL MEETING MINUTES OF FEBRUARY 18, 2020 MOTION – A motion was made and seconded by Authority Members Fitzpatrick/Evans to approve the Consent Calendar as recommended. Motion passed unanimously. CONSENT CALENDAR ITEM NO. 1 5 HOUSING AUTHORITY MINUTES Page 2 of 3 APRIL 21, 2020 QUARTERLY MEETING BUSINESS SESSION – Taken out of Agenda order 1. Item was pulled from the Agenda >>> APPOINT HOUSING AUTHORITY CHAIRPERSON AND VICE-CHAIRPERSON FOR CALENDAR YEAR 2020 2. APPROVE FUNDING OPTION FOR AREA HOMELESS PREVENTION PROGRAMS Assistant to the City Manager Villalpando and Management Specialist Kinley presented the staff report, which is on file in the Clerk’s Office. Chairperson Radi said Linda Barrack, CEO and President of Martha’s Village and Kitchen, provided WRITTEN PUBLIC COMMENT thanking the City for considering allocating funding to help assist Area Homeless Prevention Programs; and commending the City for its quick response to the critical needs of non-profits providing services to the homeless and struggling community members during this time of need due to the spread of COVID-19. Chairperson Radi commended homeless prevention organizations for providing critical and invaluable services and support to help the community get through these difficult times. Council expressed general support for Funding Option No. 1 as presented in the staff report, providing equal funding amongst the three organizations; commended the Housing Commission for their detailed review and thoughtful recommendations; and discussed funding status for Path of Life Ministries through the Coachella Valley Association of Governments (CVAG); matching funds for CVAG offered in the past from Desert Healthcare District are no longer available; the unlikely feasibility of executing a Memorandum of Understanding between the City and CVAG to provide a guarantee to expend the funds in La Quinta as the need is primarily valley-wide; essential services and resources offered by Martha’s Village and Kitchen and Coachella Valley Rescue Mission. MOTION – A motion was made and seconded by Authority Members Evans/Peña to approve Funding Option No. 1 providing $83,333.33 assistance to area homeless service providers and homeless prevention partners: Coachella Valley Rescue Mission, Martha’s Village and Kitchen, and Coachella Valley Association of Governments. CHAIR AND BOARD MEMBERS' ITEMS – None 6 HOUSING AUTHORITY MINUTES Page 3 of 3 APRIL 21, 2020 QUARTERLY MEETING ADJOURNMENT There being no further business, it was moved and seconded by Authority Members Evans/Fitzpatrick to adjourn at 5:47 p.m. Motion passed unanimously. Respectfully submitted, MONIKA RADEVA, Authority Secretary La Quinta Housing Authority 7 8 City of La Quinta HOUSING AUTHORITY SPECIAL MEETING: May 19, 2020 STAFF REPORT AGENDA TITLE: RECEIVE AND FILE THE LA QUINTA HOUSING AUTHORITY ANNUAL REPORT FOR FISCAL YEAR 2018/19 PURSUANT TO CALIFORNIA HEALTH AND SAFETY CODE SECTION 34328 RECOMMENDATION Receive and file the Fiscal Year 2018/19 La Quinta Housing Authority Annual Report. EXECUTIVE SUMMARY •California Health and Safety Code Section 34328 requires the Housing Authority (Authority) to prepare and file an Annual Report (Report). •The Report (Attachment 1) presents all Authority activities for 2018/19. •The Report will be posted on the City’s website and filed with the City Clerk. FISCAL IMPACT – None. BACKGROUND/ANALYSIS The Report reviews the Authority’s assets, budget, housing unit compliance, and affordable housing activities during 2018/19, and includes the following findings: •No bonds were issued nor were any affordable housing commitments made. •After transferring ownership of the Washington Street Apartments project to Coachella Valley Housing Coalition on March 15, 2018, the project has been completed and officially opened on November 21, 2019. •The Authority remains in compliance with the Housing Affordability requirement wherein 50 percent of the Authority’s 1,284 assisted rental units are available to persons of very-low income. •The Authority has 395 silent second trust deed loans, and 1 residential rehabilitation loan, all of which provide affordability covenants and are monitored for compliance. CONSENT CALENDAR ITEM NO. 2 9 •The Authority did not issue any domestic violence related termination notices. ALTERNATIVES As this is a receive and file action, no alternatives are presented. Prepared by: Doug Kinley, Housing Specialist Approved by: Jon McMillen, Executive Director Attachment: 1. La Quinta Housing Authority Annual Report 10 City of La Quinta Housing Authority Fiscal Year 2018-19 Annual Report ATTACHMENT 1 Coral Mountain Apartments 11 City of La Quinta Housing Authority Fiscal Year 2018-19 Annual Report ATTACHMENT 1 Introduction About This Annual Report SUMMARY California Health and Safety Code (“HSC”) Section 34328 states that “at least once a year, an authority shall file with the clerk of the respective city or county and with the Department of Housing and Community Development (“HCD”) a report of its activities for the preceding year“(“Annual Report”). This Annual Report for the La Quinta Housing Authority (“Authority”) covers all the activities that have occurred during the 2018-19 Fiscal Year (“FY 18-19”), including housing unit compliance with affordability requirements, activities concerning existing debt obligations, as well as land transactions and development. LEGAL AUTHORITY It is the intent of the State legislature that housing authorities function as local entities with the primary responsibility of providing housing for very low- and low-income households. As such, housing authorities are distinct, autonomous, legal entities that derive their powers from State statute. The HSC, beginning with Section 34200, provides for the functioning of a local housing authority through a resolution of the local governing body. In the case of the City of La Quinta (“City”), the City Council of the City of La Quinta (“City Council”) resolved that the Authority could exercise its powers. The resolution adopted by the City Council must be accompanied by a finding that either of the following is true: (1) unsanitary or unsafe housing exists in the city or (2) there is a shortage of safe or sanitary housing available to persons of low income. On September 15, 2009, the City Council adopted Resolution No. 2009-005, confirming that both aforementioned findings have been met to establish a housing authority in accordance with the California Housing Authorities Law (Health and Safety Code Section 34200, et. seq.). The Authority adopted Bylaws and Rules of Procedure on October 6, 2009 by Resolution HA 2009-001, which was amended by the Authority on April 15, 2014. ABx1 26 dissolved redevelopment agencies in California effective February 1, 2012. Health and Safety Code Section 34176(b)(2) allows the local housing authority to assume all rights, powers, assets, liabilities, duties, and obligations associated with the housing activities of a dissolved redevelopment agency. On January 17, 2012, the La Quinta Housing Authority adopted resolution HA 2012-002, electing to be the “housing successor” to the dissolved La Quinta Redevelopment Agency. Health and Safety Code Section 34179 requires the formation of oversight boards to approve transactions related to former redevelopment agencies. The Oversight Board of the Successor Agency to La Quinta Redevelopment Agency was established on March 7, 2012. The Oversight Board subsequently approved the transfer of affordable housing properties to the La Quinta Housing Authority on April 18, 2012 via resolutions OB 2012- 008 and OB 2012-009. OBJECTIVES OF THE HOUSING AUTHORITY The Authority was established to own rental properties in the City of La Quinta that were scheduled for substantial rehabilitation, and to hold title to vacant properties that will be developed with single and multi-family housing. A detailed inventory of Authority properties is presented in Tables 1a, 1b, and 1c. The Authority contracts with private entities to manage the occupied properties. The Authority’s objectives are: • Provide safe and sanitary housing opportunities for La Quinta residents; 12 City of La Quinta Housing Authority Fiscal Year 2018-19 Annual Report ATTACHMENT 1 • Rehabilitate properties that exhibit unsafe or unhealthy characteristics; and • Increase, improve, and preserve the community’s affordable housing stock. CONTENTS OF THE HOUSING AUTHORITY’S ANNUAL REPORT This Annual Report has been developed to: • Summarize the Authority’s activities during FY 18-19, including any bond issuances, and loan or finance agreements that the Authority has entered into; • Show compliance with requirements of HSC Section 34312.3 such as the minimum amount of housing units affordable to lower income in projects assisted by the Authority, and document established base rents and/or maximum rental payments for lower income households; and • Document any domestic violence tenancy or Section 8 voucher termination as required by HSC Section 34328.1. HOUSING AUTHORITY DEBT OBLIGATIONS Pursuant to HSC Section 34328.1, the Authority must provide a complete report of all bond, loan and financing agreement transactions during the prior fiscal year. Authority activities permitted by HSC Section 34312.3 include issuing bonds, loans and financing agreements for multi-family rental housing projects. There were no new bond, loan or financing agreement transactions during FY 18-19. LAND TRANSACTIONS AND DEVELOPMENT HSC Section 34312.3 permits housing authorities to undertake activities related to: • The development, rehabilitation, or financing of housing projects; • The purchase, sale, lease, ownership, operation, or management of housing projects assisted by the Authority; conveyance of surplus lands to a developer for permitted purposes; and • Establish a special trust fund or account funded with bond proceeds or developer funds. Washington Street Apartments ownership was transferred to the Coachella Valley Housing Coalition (CVHC) on March 15, 2018. The work that has been completed as part of the affordable housing project includes, demolition, utility infrastructure upgrades, and rehabilitation of existing units, and the construction of 68 new units and associated community centers. A combination of housing funds, bond proceeds, and tax credit financing was used to pay for the design, architectural, engineering, and project management services in addition to vertical construction and rehabilitation. The Project has been completed as of November 21, 2019. HOUSING AUTHORITY ASSETS Housing Authority assets include real property assets owned or managed by the Authority and include a breakdown of the current and anticipated income levels at each property 13 City of La Quinta Housing Authority Fiscal Year 2018-19 Annual Report ATTACHMENT 1 where applicable. All Real Property Assets are shown on Table 1a and 1b. A summary of the seven (7) long-term loans made by the former La Quinta Redevelopment Agency to affordable housing developers is provided in Table 1c. These loans have been assumed by the Authority due to redevelopment dissolution. Real Property Inventory Table 1a 14 City of La Quinta Housing Authority Fiscal Year 2018-19 Annual Report ATTACHMENT 1 HOUSING UNIT COMPLIANCE As set forth by HSC Sections 34328 and 34328.1, housing authorities are required to: • Show compliance with requirements of HSC Section 34312.3 such as the minimum amount of housing units affordable to lower income households in projects assisted by the Authority, and document established base rents and/or maximum rental payments for these households; and • Document any domestic violence tenancy or Section 8 voucher termination as required by HSC Section 34328.1. The following subsections provide a summary of the Authority’s progress toward the requirements listed above. Housing Affordability Requirement The authority shall require the owners of housing projects assisted pursuant to this section to accept as tenants, on the same basis as all other prospective tenants, in the units reserved for very low income households, any very low income households who are recipients of federal certificates for rent subsidies pursuant to the existing program under Section 8 of the United States Housing Act of 1937 (42 U.S.C. Sec. 1437f), or its successor. The authority shall not permit a selection criteria to be applied to Section 8 certificate holders that is any more burdensome than the criteria applied to all other prospective tenants. No resident in housing units assisted pursuant to this section shall be denied continued occupancy or ownership because, after admission, the resident's family income increases to exceed the eligibility level. However, the authority shall ensure that percentage requirements of this section shall continue to be met by providing the next available unit or units to persons of low income or by taking other actions to satisfy the percentage requirements of this section. Table 2 provides a summary of the Authority assumed enforcement responsibility for affordability covenants within privately-owned, former redevelopment-agency properties and shows how the current affordability mix of the Authority’s assisted projects meet established requirements within HSC Section 34312.3. 15 City of La Quinta Housing Authority Fiscal Year 2018-19 Annual Report ATTACHMENT 1 The Authority has 395 silent second trust deed loans, and 1 residential rehabilitation loan, all of which provide affordability covenants on these properties. Silent second trust deed loans are not repaid unless there is a default on affordability covenants. Interest assessed only if there is a default on affordability covenants. (Due to the length of this list, it is attached as Table 5 of this report.) Base & Maximum Rents The Housing Authority monitors to ensure compliance of rental payments charged for its housing units and will make necessary adjustments to bring any rental payments that exceed the listed amounts in Table 3 into compliance. Table 3 Domestic Violence State law requires that a housing authority annually disclose data related to domestic violence incidents in units owned or operated by the housing authority. Specifically, the data must include: • Data on termination of tenancies and/or Section 8 vouchers of victims of domestic violence in housing authority units. 16 City of La Quinta Housing Authority Fiscal Year 2018-19 Annual Report ATTACHMENT 1 • Summary of steps taken by the housing authority to address any termination of tenancies and/or Section 8 vouchers of victims of domestic violence. In Fiscal Year 2018-19, there were no terminations of tenancies or Section 8 vouchers of victims of domestic violence in units owned or operated by the Authority. AUTHORITY BUDGET Table 4 presents the Authority’s actual expenditures for FY 2018- 19 as well as the estimated budget to be requested for FY 2019-20. 17 City of La Quinta Housing Authority Fiscal Year 2018-19 Annual Report ATTACHMENT 1 18 City of La Quinta Housing Authority Fiscal Year 2018-19 Annual Report ATTACHMENT 1 19 City of La Quinta Housing Authority Fiscal Year 2018-19 Annual Report ATTACHMENT 1 20 City of La Quinta Housing Authority Fiscal Year 2018-19 Annual Report ATTACHMENT 1 21 City of La Quinta Housing Authority Fiscal Year 2018-19 Annual Report ATTACHMENT 1 22 City of La Quinta Housing Authority Fiscal Year 2018-19 Annual Report ATTACHMENT 1 23 City of La Quinta Housing Authority Fiscal Year 2018-19 Annual Report ATTACHMENT 1 24 City of La Quinta HOUSING AUTHORITY SPECIAL MEETING: May 19, 2020 STAFF REPORT AGENDA TITLE: RECEIVE AND FILE HOUSING SUCCESSOR ANNUAL REPORT FOR FISCAL YEAR 2018/19 REGARDING THE LOW- AND MODERATE-INCOME HOUSING ASSET FUND PURSUANT TO CALIFORNIA HEALTH AND SAFETY CODE SECTION 34176.1 (F) FOR THE LA QUINTA HOUSING AUTHORITY RECOMMENDATION Receive and file the La Quinta Housing Successor Annual Report for fiscal year 2018/19 regarding the Low- and Moderate-Income Asset Fund pursuant to California Health and Safety Code Section 34176.1 (f) for the La Quinta Housing Authority. EXECUTIVE SUMMARY •The Housing Successor Annual Report (Report) is part of a State requirement for Housing Successors to Redevelopment Agencies. •The Report provides the Housing Authority a comprehensive representation of the City’s housing assets and activities. •Once filed, the Report will be made available to the public on the City’s website and filed with the City Clerk. FISCAL IMPACT – None. BACKGROUND/ANALYSIS The Report must provide the Housing Successor’s Low - and Moderate-Income Housing Asset Fund (LMIHAF) balance, deposits, expenditures, transfers, current projects, acquisitions, obligations, income test, senior housing test, and excess surplus test. The Report for 2018/19 reflects the following findings: •A total of $1,437,457 was deposited into the LMIHAF; the majority of the deposits originated from rental revenue generated by City-owned affordable housing properties and a $121,857 loan repayment from Coral Mountain. •A total of $776,721 was expended from LMIHAF for maintenance, monitoring, administration expenses, and homeless prevention funding. CONSENT CALENDAR ITEM NO. 3 25 •A total of $59,192,877 in assets owned by the Housing Successor was reported, assets consist of notes and loans, land, building and improvements and accumulated depreciation. •Senior Housing Test reflects that 22 percent of 1284 total Housing Successor Assisted rental units are restricted to seniors. •The Housing Successor reports no computed excess surplus; therefore, no plan exists for eliminating the excess surplus. The Report will be submitted to the California Department of Housing and Community Development to comply with California Health and Safety Code Section 34176.1(f). ALTERNATIVES As this is a receive and file action, no alternatives are presented. Prepared by: Doug Kinley, Housing Specialist Approved by: Jon McMillen, Executive Director Attachment: 1. La Quinta Housing Successor Annual Report 26 ATTACHMENT 1 HOUSING SUCCESSOR ANNUAL REPORT April 30, 2020 LOW- AND MODERATE-INCOME HOUSING ASSET FUND FOR FISCAL YEAR 2018-19 PURSUANT TO CALIFORNIA HEALTH AND SAFETY CODE SECTION 34176.1(f) FOR THE LA QUINTA HOUSING AUTHORITY 27 ATTACHMENT 1 HOUSING SUCCESSOR ANNUAL REPORT TABLE OF CONTENTS INTRODUCTION ............................................................................................................................. 1 AMOUNT DEPOSITED INTO LMIHAF ........................................................................................... 1 ENDING BALANCE OF LMIHAF ................................................................................................... 1 DESCRIPTION OF EXPENDITURES FROM LMIHAF ................................................................... 1 TABLE 1: DESCRIPTION OF LMIHAF EXPENDITURES STATUTORY VALUE OF ASSETS OWNED BY HOUSING SUCCESSOR ................................. 2 TABLE 2: STATUTORY VALUE OF ASSETS OWNED BY HOUSING SUCCESSOR DESCRIPTION OF TRANSFERS ................................................................................................... 2 PROJECT DESCRIPTIONS ............................................................................................................ 2 TABLE 3: PROJECT DESCRIPTIONS STATUS OF COMPLIANCE WITH SECTION 33334.16................................................................ 3 TABLE 4: SECTION 33334.16 COMPLIANCE DESCRIPTION OF OUTSTANDING OBLIGATIONS UNDER SECTION 33413. ......................... 4 INCOME TEST ................................................................................................................................ 4 SENIOR HOUSING TEST ............................................................................................................... 5 TABLE 5: SENIOR HOUSING TEST EXCESS SURPLUS TEST .............................................................................................................. 5 TABLE 6: EXCESS SURPLUS TEST 28 ATTACHMENT 1 LA QUINTA HOUSING AUTHORITY Page 1 INTRODUCTION This Housing Successor Annual Report (“Report”) addresses the requirements of California Health and Safety Code Section 34176.1(f) regarding the Low- and Moderate- Income Housing Asset Fund (“LMIHAF”). This Report outlines the financial and housing covenant details of the La Quinta Housing Authority (“Housing Successor”) for 2018-19 (the “Fiscal Year”). The purpose of this Report is to provide the governing body of the Housing Successor an annual report on the housing assets and activities of the Housing Successor under Part 1.85, Division 24 of the California Health and Safety Code, in particular sections 34176 and 34176.1 (“Dissolution Law”). This report includes discussion on the deposits to, ending balance of, and expenditures from the LMIHAF. A description of the Housing Successor’s assets, and any transfers of assets to other housing successor agencies are addressed as well. The report also discusses the Housing Successor’s current projects, acquisitions of any real property since February 1, 2012, or any outstanding obligations. Finally, as required by law, three separate test are discussed – the income test, senior housing test, and excess surplus test. This Report is to be provided to the Housing Successor’s governing body by December 31, 2019 (six months after the end of the Fiscal Year); however, due to a delay in finalizing the Citywide Financial Statements for fiscal year 2018/19, the submittal of this report was delayed. In addition, this Report and the former redevelopment agency’s pre-dissolution Implementation Plans are to be made available to the public on the City’s website. http: www.laquintaca.gov) AMOUNT DEPOSITED INTO LMIHAF This section provides the total amount of funds deposited into the LMIHAF during the Fiscal Year. Any amounts deposited for items listed on the Recognized Obligation Payment Schedule (“ROPS”) must be distinguished from the other amounts deposited. A total of $1,437,457 was deposited into the LMIHAF during the Fiscal Year. Of the total funds deposited into the LMIHAF, a total of $0 was held for items listed on the ROPS. These deposits originated from rental revenues generated at City-owned affordable housing properties and a $121,857 loan repayment from Coral Mountain. ENDING BALANCE OF LMIHAF This section provides a statement of the balance in the LMIHAF as of the close of the Fiscal Year. Any amounts deposited for items listed on the ROPS must be distinguished from the other amounts deposited. At the close of the Fiscal Year, the ending fund balance (inclusive of notes receivables) in the LMIHAF was $22,041,097, of which $0 is held for items listed on the ROPS. DESCRIPTION OF EXPENDITURES FROM LMIHAF This section provides a description of the expenditures made from the LMIHAF during the Fiscal Year. The expenditures are to be categorized. There was a total of $776,721 expended from the LMIHAF, divided into the following categories: 29 ATTACHMENT 1 LA QUINTA HOUSING AUTHORITY Page 2 TABLE 1: DESCRIPTION OF LMIHAF EXPENDITURES Description of Expenditures Total Expenditures Maintenance, Monitoring and Administration Expenditures $610,055 Homeless Prevention and Rapid Rehousing Services Expenditures $166,666 Housing Development Expenditures (Total of Next Three Lines) $0.00 Expenditures on Low Income Units $0.00 Expenditures on Very Low-Income Units $0.00 Expenditures on Extremely Low-Income Units $0.00 Total LMIHAF Expenditures in Fiscal Year $776,721 STATUTORY VALUE OF ASSETS OWNED BY HOUSING SUCCESSOR This section provides the statutory value of real property owned by the Housing Successor, the value of loans and grants receivables, and the sum of these two amounts. TABLE 2: STATUTORY VALUE OF ASSETS OWNED BY HOUSING SUCCESSO R Asset Type Statutory Value of Assets Notes and Loans* $33,923,705 Land $25,009,379 Building and Improvements $742,453 Less Accumulated Depreciation $482,660 Total Assets $59,192,877 *Increase in Notes and Loans is a result of adding 20% of the successor agency loan repayment balance as of June 30, 2019. The DOF approved in the Last and Final ROPS on November 22, 2017. DESCRIPTION OF TRANSFERS The Housing Successor did not make any transfers in the Fiscal Year. PROJECT DESCRIPTIONS This section describes any project for which the Housing Successor receives or holds property tax revenue pursuant to the ROPS and the status of that project. The following is a description of project(s) for which the Housing Successor receives or holds property tax revenue pursuant to the ROPS as well as the status of the project(s): TABLE 3: PROJECT DESCRIPTIONS Project Name Status Washington Street Apartments Demolition, Sitework, Infrastructure Improvements and Construction started in April 2018 Washington Street Apartments Washington Street Apartments ownership was transferred to the Coachella Valley Housing Coalition (CVHC) on March 15, 2018.The work to be completed as part of the affordable housing project includes demolition, utility infrastructure upgrades, and rehabilitation of existing units, and the construction of 68 new units and an associated community center. A combination of housing funds, bond proceeds, and tax credit financing is being used to pay for the design, architectural, engineering, and project 30 ATTACHMENT 1 LA QUINTA HOUSING AUTHORITY Page 3 management services in addition to vertical construction and rehabilitation. The project was been completed on November 21, 2019. STATUS OF COMPLIANCE WITH SECTION 33334.16 This section provides a status update on compliance with Section 33334.16 for interests in real property acquired by the former redevelopment agency prior to February 1, 2012. For interests in real property acquired on or after February 1, 2012, provide a status update on the project. Section 34176.1 provides that Section 33334.16 does not apply to interests in real property acquired by the Housing Successor on or after February 1, 2012; however, this Report presents a status update on the project related to such real property. With respect to interests in real property acquired by the former redevelopment agency prior to February 1, 2012, the time period described in Section 33334.16 shall be deemed to have commenced on the date that the Department of Finance approved the property as a housing asset in the LMIHAF; thus, as to real property acquired by the former redevelopment agency now held by the Housing Successor in the LMIHAF, the Housing Successor must initiate activities consistent with the development of the real property for the purpose for which it was acquired within five years of the date of the DOF approved such property as a housing asset. The following provides a status update on the real property or properties housing asset(s) that were acquired prior to February 1, 2012 and compliance with five-year period: TABLE 4: SECTION 33334.16 COMPLIANCE Address of Property Date of Acquisition Deadline to Initiate Development Activity Status of Housing Successor Activity Dune Palms Road and Westward Ho Drive (APN 600-030-009) 6/13/2006 6/13/2016 Deadline met- City has initiated site programming and developed conceptual plans Dune Palms Road and Westward Ho Drive (APN 600-030-003) 1/17/2007 1/17/2017 Deadline met- City has initiated site programming and developed conceptual plans Dune Palms Road and Westward Ho Drive (APN 600-030-008) 4/27/2007 4/27/2017 Deadline met- City has initiated site programming and developed conceptual plans Avenida Mendoza and Avenida Montezuma (APN 773-077-014) 11/30/2007 11/30/2017 Deadline met- City has initiated site programming and developed conceptual plans Dune Palms Road and Westward Ho Drive (APN 600-030-002) 6/12/2009 6/12/2019 Deadline met- City has initiated site programming and developed conceptual plans Dune Palms Road and Westward Ho Drive (APN 600-030-005) 1/26/2010 1/26/2020 Deadline met- City has initiated site programming and developed conceptual plans Calle Tamazula south of Avenida La Fonda (APN 770-174-002) 10/31/1990 08/31/2022 Deadline met – Sold to private party in 12/2019, will remain in listing until next year’s Report. Deposited proceeds into the 31 ATTACHMENT 1 LA QUINTA HOUSING AUTHORITY Page 4 Low- and Moderate-Income Housing Fund. Avenida Navarro between Calle Durango/Calle Sonora (APN 773-234-015) 02/01/1993 08/31/2022 Deadline met – Sold to private party in 03/2019, will remain in listing until next year’s Report. Deposited proceeds into the Low- and Moderate-Income Housing Fund. Avenida Herrera and Calle Sonora (APN 773-223-022) 03/03/2011 08/31/2022 City to market vacant property and place proceeds of sale into the Low- and Moderate- Income Housing Fund. Avenida Villa between Calle Durango/Calle Sonora (APN 733-234-015) 03/03/2011 08/31/2022 City to market vacant property and place proceeds of sale into the Low- and Moderate- Income Housing Fund. Health and Safety Code Section 33334.16 required former redevelopment agencies to initiate activities, such as zone changes or disposition and development agreements within five years of acquiring a property. Pursuant to Health and Safety Code Section 33334.16, the legislative body is authorized to extend the deadline to initiate activities by an additional five years upon affirming the intention to develop housing affordable to households of low and moderate income. In 2011, the Housing Authority extended development of the abovementioned properties by adopting Resolution 2011-070. In 2017, the Housing Authority approved a second resolution (Resolution 2017-005) extending the period during which it may retain property for an additional five (5) years. The following provides a status update on the project(s) for property or properties that have been acquired by the Housing Successor using LMIHAF on or after February 1, 2012. The Housing Successor did not acquire property on or after February 1, 2012. DESCRIPTION OF OUTSTANDING OBLIGATIONS UNDER SECTION 33413.This section describes the outstanding inclusionary housing obligations, if any, under Section 33413 that remained outstanding prior to dissolution of the former redevelopment agency as of February 1, 2012 along with the Housing Successor’s progress in meeting those prior obligations, if any, of the former redevelopment agency and how the Housing Successor plans to meet unmet obligations, if any. The housing successor does not have any obligations to fulfill under Section 33413. INCOME TEST This section provides the information required by Section 34176.1(a)(3)(B), or a description of expenditures by income restriction for a five-year period, with the time period beginning on January 1, 2014 and whether the statutory thresholds have been met. The Housing Successor has not historically tracked expenditures on extremely low- income households. Expenditures in the previous Fiscal Year can be distributed based on known household incomes (refer to Table 1 for the distribution of expenditures by household income level for the Fiscal Year). This fiscal year 18/19, the Housing Successor is tracking expenditures by income level such that the Housing Authority can report on expenditures by household income over a five-year period, as shown in Table 5. The recorded development spent on development can be tracked to the Washington Street Apartments project, having been completed in November 2019 officially. Of the 140 units, 32 ATTACHMENT 1 LA QUINTA HOUSING AUTHORITY Page 5 a total of 24 units are deed restricted to 30% AMI or lower. With an estimated cost of $71,428/Unit of development costs, there has been approximately $1,714,286 spent on Extremely Low-Income development. TABLE 5: INCOME TEST - $ SPENT ON DEVELOPMENT Category of Income $ Spent LMIHAF Spent on Extremely Low-Income Households $1,714,286 Spent on ELI (A) Total LMIHAF (Five Year Total - FY 14/15 through 18/19) $10,000,000 Total LMIHAF (B) Extremely Low-Income Test (A)/(B) 17% SENIOR HOUSING TEST This section provides the percentage of units of deed-restricted rental housing restricted to seniors and assisted individually or jointly by the Housing Successor, its former Redevelopment Agency, and its host jurisdiction within the previous 10 years in relation to the aggregate number of units of deed-restricted rental housing assisted individually or jointly by the Housing Successor, its former Redevelopment Agency and its host jurisdiction within the same time period. For this Report the ten-year period reviewed is 2008 to 2018. TABLE 6: SENIOR HOUSING TEST Unit Category # of Units Assisted Senior Rental Units 280 Total Assisted Rental Units 1284 Senior Housing Test (%) 22% EXCESS SURPLUS TEST The Housing Successor does not presently retain a computed excess surplus pursuant to Health and Safety Code Section 34176.1. For the purpose of this section of the Report, pursuant to Section 34176.1(d), “’excess surplus’ shall mean an unencumbered amount in the account that exceeds the greater of one million dollars ($1,000,000) or the aggregate amount deposited into the account during the housing successor’s preceding four fiscal years, whichever is greater.” If the Unencumbered Amount (See Table 6) does not exceed the greater of the aggregate amount deposited into the LMIHAF during the preceding four fiscal years or $1,000,000, whichever is greater, there is no excess surplus. The Housing Successor computed excess surplus is noted below in table 6. TABLE 7: EXCESS SURPLUS TEST FY 2018-19 Unencumbered Amount (Available Housing Successor Funds) $11,412,397 Aggregate Deposited for Last Four Years $12,784,296 Greater of Aggregate Deposited for Last Four Years or $1,000,000 $12,784,296 Computed Excess Surplus None 33 34 City of La Quinta HOUSING AUTHORITY SPECIAL MEETING: May 19, 2020 STAFF REPORT AGENDA TITLE: APPROVE AGREEMENT FOR CONTRACT SERVICES WITH LA QUINTA PALMS REALTY FOR PROPERTY MANAGEMENT SERVICES RECOMMENDATION Approve an Agreement for Contract Services for property management services with La Quinta Palms Realty in an amount not to exceed $42,000 annually for the first three years; and authorize the Executive Director to execute the agreement. EXECUTIVE SUMMARY •La Quinta Palms Realty (LQPR) currently provides property management services for the Housing Authority’s (Authority) inventory of properties that are provided to qualified low-income residents in the City of La Quinta (City). •The current contract with LQPR expires June 30, 2020. •On February 14, 2020, a request for proposal (RFP) was posted on the City website for residential property management services. •Staff selected LQPR, the qualified firm has worked with the City for 16 years, providing excellent services. •The Agreement for Contract Services (Agreement) would begin July 1, 2020, with an initial three-year term to expire on June 30, 2023. •The Housing Commission (Commission) reviewed the Agreement at the May 6, 2020 special Commission meeting and recommended the Authority approve the contract. FISCAL IMPACT The annual cost is not-to-exceed $42,000 per year ($3,500 monthly). The total contract cost is not-to-exceed $126,000 for the initial contract term of three (3) years. Two extensions of one (1) year each are optional, with costs subject to a potential 5% increase in total from the original annual fee, amounting to a not-to-exceed amount of $44,100 per year ($3,675 monthly). Funds are available in the Housing Authority budget (241 -9101-60103, Professional Services). BUSINESS SESSION ITEM NO. 1 35 Cost summary for the services are as follows: YEAR MONTHLY BASE ANNUAL BASE 2020/2021 $3,500 $42,000 2021/2022 $3,500 $42,000 2022/2023 $3,500 $42,000 INITIAL 3-YEAR TERM $126,000 2023/2024 $3,675 $44,100 2024/2025 $3,675 $44,100 OPTIONAL EXTENSIONS (2-YEARS) $88,200 TOTAL CONTRACT NOT TO EXCEED $214,200 BACKGROUND/ANALYSIS In February 2020, staff solicited an RFP for residential property management services and received one proposal from LQPR. During the RFP period, Staff also conducted outreach to local vendors for their review and consideration; Real Property Management, Abode Communities, Hyder Property Management, and RPM Company. LQPR is based out of La Quinta and has provided real estate and property management services throughout the Coachella Valley since its establishment in 1982. LQPR has provided professional residential property management services to the City of La Quinta/Authority for 16 years. Upon the Authority’s approval, the initial term of this Agreement would begin July 1, 2020 and expire on June 30, 2023, with an option to renew for two extensions, each being one additional year (Attachment 1). The Authority has the right to terminate the Agreement at any time with a 30 -day written notice. The Commission received staff’s report du ring the May 6, 2020 meeting and recommended the Authority approve the contract. ALTERNATIVES The Authority may elect to not approve this Agreement. However, staff does not recommend this alternative due to the immediate need for these services and limited response from other qualified firms. Prepared by: Doug Kinley, Housing Specialist Approved by: Jon McMillen, Executive Director Attachment: 1.Agreement for Contract Services 36 Page 1 of 34 AGREEMENT FOR CONTRACT SERVICES THIS AGREEMENT FOR CONTRACT SERVICES (the “Agreement”) is made and entered into by and between the CITY OF LA QUINTA, (“City”), a California municipal corporation, and LA QUINTA PALMS REALTY, Inc. (“Contracting Party”). The parties hereto agree as follows: 1.SERVICES OF CONTRACTING PARTY. 1.1 Scope of Services. In compliance with all terms and conditions of this Agreement, Contracting Party shall provide those services related to residential property management services, as specified in the “Scope of Services” attached hereto as “Exhibit A” and incorporated herein by this reference (the “Services”). Contracting Party represents and warrants that Contracting Party is a provider of first-class work and/or services and Contracting Party is experienced in performing the Services contemplated herein and, in light of such status and experience, Contracting Party covenants that it shall follow industry standards in performing the Services required hereunder, and that all materials, if any, will be of good quality, fit for the purpose intended. For purposes of this Agreement, the phrase “industry standards” shall mean those standards of practice recognized by one or more first-class firms performing similar services under similar circumstances. 1.2 Compliance with Law. All Services rendered hereunder shall be provided in accordance with all ordinances, resolutions, statutes, rules, regulations, and laws of the City and any Federal, State, or local governmental agency of competent jurisdiction. 1.3 Wage and Hour Compliance, Contracting Party shall comply with applicable Federal, State, and local wage and hour laws. 1.4 Licenses, Permits, Fees and Assessments. Except as otherwise specified herein, Contracting Party shall obtain at its sole cost and expense such licenses, permits, and approvals as may be required by law for the performance of the Services required by this Agreement, including a City of La Quinta business license. Contracting Party and its employees, agents, and subcontractors shall, at their sole cost and expense, keep in effect at all times during the term of this Agreement any licenses, permits, and approvals that are legally required for the performance of the Services required by this Agreement. Contracting Party shall have ATTACHMENT 1 37 Page 2 of 34 the sole obligation to pay for any fees, assessments, and taxes, plus applicable penalties and interest, which may be imposed by law and arise from or are necessary for the performance of the Services required by this Agreement, and shall indemnify, defend (with counsel selected by City), and hold City, its elected officials, officers, employees, and agents, free and harmless against any such fees, assessments, taxes, penalties, or interest levied, assessed, or imposed against City hereunder. Contracting Party shall be responsible for all subcontractors’ compliance with this Section. 1.5 Familiarity with Work. By executing this Agreement, Contracting Party warrants that (a) it has thoroughly investigated and considered the Services to be performed, (b) it has investigated the site where the Services are to be performed, if any, and fully acquainted itself with the conditions there existing, (c) it has carefully considered how the Services should be performed, and (d) it fully understands the facilities, difficulties, and restrictions attending performance of the Services under this Agreement. Should Contracting Party discover any latent or unknown conditions materially differing from those inherent in the Services or as represented by City, Contracting Party shall immediately inform City of such fact and shall not proceed except at Contracting Party’s risk until written instructions are received from the Contract Officer, or assigned designee (as defined in Section 4.2 hereof). 1.6 Standard of Care. Contracting Party acknowledges and understands that the Services contracted for under this Agreement require specialized skills and abilities and that, consistent with this understanding, Contracting Party’s work will be held to an industry standard of quality and workmanship. Consistent with Section 1.5 hereinabove, Contracting Party represents to City that it holds the necessary skills and abilities to satisfy the industry standard of quality as set forth in this Agreement. Contracting Party shall adopt reasonable methods during the life of this Agreement to furnish continuous protection to the Services performed by Contracting Party, and the equipment, materials, papers, and other components thereof to prevent losses or damages, and shall be responsible for all such damages, to persons or property, until acceptance of the Services by City, except such losses or damages as may be caused by City’s own negligence. The performance of Services by Contracting Party shall not relieve Contracting Party from any obligation to correct any incomplete, inaccurate, or defective work at no further cost to City, when such inaccuracies are due to the negligence of Contracting Party. 1.7 Additional Services. In accordance with the terms and conditions of this Agreement, Contracting Party shall perform services 38 Page 3 of 34 in addition to those specified in the Scope of Services (“Additional Services”) only when directed to do so by the Contract Officer, or assigned designee, provided that Contracting Party shall not be required to perform any Additional Services without compensation. Contracting Party shall not perform any Additional Services until receiving prior written authorization (in the form of a written change order if Contracting Party is a contractor performing the Services) from the Contract Officer, or assigned designee, incorporating therein any adjustment in (i) the Contract Sum, and/or (ii) the time to perform this Agreement, which said adjustments are subject to the written approval of Contracting Party. It is expressly understood by Contracting Party that the provisions of this Section shall not apply to the Services specifically set forth in the Scope of Services or reasonably contemplated therein. It is specifically understood and agreed that oral requests and/or approvals of Additional Services shall be barred and are unenforceable. Failure of Contracting Party to secure the Contract Officer’s, or assigned designee’s written authorization for Additional Services shall constitute a waiver of any and all right to adjustment of the Contract Sum or time to perform this Agreement, whether by way of compensation, restitution, quantum meruit, or the like, for Additional Services provided without the appropriate authorization from the Contract Officer, or assigned designee. Compensation for properly authorized Additional Services shall be made in accordance with Section 2.3 of this Agreement. 1.8 Special Requirements. Additional terms and conditions of this Agreement, if any, which are made a part hereof are set forth in “Exhibit D” (the “Special Requirements”), which is incorporated herein by this reference and expressly made a part hereof. In the event of a conflict between the provisions of the Special Requirements and any other provisions of this Agreement, the provisions of the Special Requirements shall govern. 2. COMPENSATION. 2.1 Contract Sum. For the Services rendered pursuant to this Agreement, Contracting Party shall be compensated in accordance with “Exhibit B” (the “Schedule of Compensation”) (the “Contract Sum”), except as provided in Section 1.7. The method of compensation set forth in the Schedule of Compensation may include a lump sum payment upon completion, payment in accordance with the percentage of completion of the Services, payment for time and materials based upon Contracting Party’s rate schedule, but not exceeding the Contract Sum, or such other reasonable methods as may be specified in the Schedule of Compensation. The Contract Sum shall include the attendance of Contracting Party at all project meetings reasonably deemed necessary 39 Page 4 of 34 by City; Contracting Party shall not be entitled to any additional compensation for attending said meetings. Compensation may include reimbursement for actual and necessary expenditures for reproduction costs, transportation expense, telephone expense, and similar costs and expenses when and if specified in the Schedule of Compensation. Regardless of the method of compensation set forth in the Schedule of Compensation, Contracting Party’s overall compensation shall not exceed the Contract Sum, except as provided in Section 1.7 of this Agreement. 2.2 Method of Billing & Payment. Any month in which Contracting Party wishes to receive payment, Contracting Party shall submit to City no later than the tenth (10th) working day of such month, in the form approved by City’s Finance Director, an invoice for Services rendered prior to the date of the invoice. Such invoice shall (1) describe in detail the Services provided, including time and materials, and (2) specify each staff member who has provided Services and the number of hours assigned to each such staff member. Such invoice shall contain a certification by a principal member of Contracting Party specifying that the payment requested is for Services performed in accordance with the terms of this Agreement. Upon approval in writing by the Contract Officer, or assigned designee, and subject to retention pursuant to Section 8.3, City will pay Contracting Party for all items stated thereon which are approved by City pursuant to this Agreement no later than thirty (30) days after invoices are received by the City’s Finance Department. 2.3 Compensation for Additional Services. Additional Services approved in advance by the Contract Officer, or assigned designee, pursuant to Section 1.7 of this Agreement shall be paid for in an amount agreed to in writing by both City and Contracting Party in advance of the Additional Services being rendered by Contracting Party. Any compensation for Additional Services amounting to five percent (5%) or less of the Contract Sum may be approved by the Contract Officer or assigned designee. Any greater amount of compensation for Additional Services must be approved by the La Quinta City Council, the City Manager, or Department Director, depending upon City laws, regulations, rules and procedures concerning public contracting. Under no circumstances shall Contracting Party receive compensation for any Additional Services unless prior written approval for the Additional Services is obtained from the Contract Officer, or assigned designee, pursuant to Section 1.7 of this Agreement. 3. PERFORMANCE SCHEDULE. 3.1 Time of Essence. Time is of the essence in the performance of this Agreement. If the Services not completed in accordance with the Schedule of Performance, as set forth in Section 3.2 and “Exhibit 40 Page 5 of 34 C”, it is understood that the City will suffer damage. 3.2 Schedule of Performance. All Services rendered pursuant to this Agreement shall be performed diligently and within the time period established in “Exhibit C” (the “Schedule of Performance”). Extensions to the time period specified in the Schedule of Performance may be approved in writing by the Contract Officer, or assigned designee. 3.3 Force Majeure. The time period specified in the Schedule of Performance for performance of the Services rendered pursuant to this Agreement shall be extended because of any delays due to unforeseeable causes beyond the control and without the fault or negligence of Contracting Party, including, but not restricted to, acts of God or of the public enemy, fires, earthquakes, floods, epidemic, quarantine restrictions, riots, strikes, freight embargoes, acts of any governmental agency other than City, and unusually severe weather, if Contracting Party shall within ten (10) days of the commencement of such delay notify the Contract Officer, or assigned designee, in writing of the causes of the delay. The Contract Officer, or assigned designee, shall ascertain the facts and the extent of delay, and extend the time for performing the Services for the period of the forced delay when and if in the Contract Officer’s judgment such delay is justified, and the Contract Officer’s determination, or assigned designee, shall be final and conclusive upon the parties to this Agreement. Extensions to time period in the Schedule of Performance which are determined by the Contract Officer, or assigned designee, to be justified pursuant to this Section shall not entitle the Contracting Party to additional compensation in excess of the Contract Sum. 3.4 Term. Unless earlier terminated in accordance with the provisions in Article 8.0 of this Agreement, the term of this agreement shall commence on July 1, 2020, and terminate on June 30, 2023 (“Initial Term”). This Agreement may be extended for two (2) additional year(s) upon mutual agreement by both parties (“Extended Term”). 4. COORDINATION OF WORK. 4.1 Representative of Contracting Party. The following principals of Contracting Party (“Principals”) are hereby designated as being the principals and representatives of Contracting Party authorized to act in its behalf with respect to the Services specified herein and make all decisions in connection therewith: (a) Jim Cathcart, Owner / Manager Tel No.: 760-275-3094 E-mail: JIM@LAQUINTAPALMSREALTY.COM 41 Page 6 of 34 (b) Robin Carney, Property Manager Tel No.: 760-564-4104 E-mail: ROBIN@LAQUINTAPALMSREALTY.COM It is expressly understood that the experience, knowledge, capability, and reputation of the foregoing Principals were a substantial inducement for City to enter into this Agreement. Therefore, the foregoing Principals shall be responsible during the term of this Agreement for directing all activities of Contracting Party and devoting sufficient time to personally supervise the Services hereunder. For purposes of this Agreement, the foregoing Principals may not be changed by Contracting Party and no other personnel may be assigned to perform the Services required hereunder without the express written approval of City. 4.2 Contract Officer. The “Contract Officer”, otherwise known as the Executive Director of the City of La Quinta Housing Authority or assigned designee may be designated in writing by the City Manager of the City. It shall be Contracting Party’s responsibility to assure that the Contract Officer, or assigned designee, is kept informed of the progress of the performance of the Services, and Contracting Party shall refer any decisions, that must be made by City to the Contract Officer, or assigned designee. Unless otherwise specified herein, any approval of City required hereunder shall mean the approval of the Contract Officer or assigned designee. The Contract Officer, or assigned designee, shall have authority to sign all documents on behalf of City required hereunder to carry out the terms of this Agreement. 4.3 Prohibition Against Subcontracting or Assignment. The experience, knowledge, capability, and reputation of Contracting Party, its principals, and its employees were a substantial inducement for City to enter into this Agreement. Except as set forth in this Agreement, Contracting Party shall not contract or subcontract with any other entity to perform in whole or in part the Services required hereunder without the express written approval of City. In addition, neither this Agreement nor any interest herein may be transferred, assigned, conveyed, hypothecated, or encumbered, voluntarily or by operation of law, without the prior written approval of City. Transfers restricted hereunder shall include the transfer to any person or group of persons acting in concert of more than twenty five percent (25%) of the present ownership and/or control of Contracting Party, taking all transfers into account on a cumulative basis. Any attempted or purported assignment or contracting or subcontracting by Contracting Party without City’s express written approval shall be null, void, and of no effect. No approved transfer shall release Contracting Party of any liability hereunder without the 42 Page 7 of 34 express consent of City. 4.4 Independent Contractor. Neither City nor any of its employees shall have any control over the manner, mode, or means by which Contracting Party, its agents, or its employees, perform the Services required herein, except as otherwise set forth herein. City shall have no voice in the selection, discharge, supervision, or control of Contracting Party’s employees, servants, representatives, or agents, or in fixing their number or hours of service. Contracting Party shall perform all Services required herein as an independent contractor of City and shall remain at all times as to City a wholly independent contractor with only such obligations as are consistent with that role. Contracting Party shall not at any time or in any manner represent that it or any of its agents or employees are agents or employees of City. City shall not in any way or for any purpose become or be deemed to be a partner of Contracting Party in its business or otherwise or a joint venture or a member of any joint enterprise with Contracting Party. Contracting Party shall have no power to incur any debt, obligation, or liability on behalf of City. Contracting Party shall not at any time or in any manner represent that it or any of its agents or employees are agents or employees of City. Except for the Contract Sum paid to Contracting Party as provided in this Agreement, City shall not pay salaries, wages, or other compensation to Contracting Party for performing the Services hereunder for City. City shall not be liable for compensation or indemnification to Contracting Party for injury or sickness arising out of performing the Services hereunder. Notwithstanding any other City, state, or federal policy, rule, regulation, law, or ordinance to the contrary, Contracting Party and any of its employees, agents, and subcontractors providing services under this Agreement shall not qualify for or become entitled to any compensation, benefit, or any incident of employment by City, including but not limited to eligibility to enroll in the California Public Employees Retirement System (“PERS”) as an employee of City and entitlement to any contribution to be paid by City for employer contributions and/or employee contributions for PERS benefits. Contracting Party agrees to pay all required taxes on amounts paid to Contracting Party under this Agreement, and to indemnify and hold City harmless from any and all taxes, assessments, penalties, and interest asserted against City by reason of the independent contractor relationship created by this Agreement. Contracting Party shall fully comply with the workers’ compensation laws regarding Contracting Party and Contracting Party’s employees. Contracting Party further agrees to indemnify and hold City harmless from any failure of Contracting Party to comply with applicable workers’ compensation laws. City shall have the right to offset against the amount of any payment due to Contracting Party under this Agreement any amount due to City from Contracting Party as a result of Contracting 43 Page 8 of 34 Party’s failure to promptly pay to City any reimbursement or indemnification arising under this Section. 4.5 Identity of Persons Performing Work. Contracting Party represents that it employs or will employ at its own expense all personnel required for the satisfactory performance of any and all of the Services set forth herein. Contracting Party represents that the Services required herein will be performed by Contracting Party or under its direct supervision, and that all personnel engaged in such work shall be fully qualified and shall be authorized and permitted under applicable State and local law to perform such tasks and services. 4.6 City Cooperation. City shall provide Contracting Party with any plans, publications, reports, statistics, records, or other data or information pertinent to the Services to be performed hereunder which are reasonably available to Contracting Party only from or through action by City. 5. INSURANCE. 5.1 Insurance. Prior to the beginning of any Services under this Agreement and throughout the duration of the term of this Agreement, Contracting Party shall procure and maintain, at its sole cost and expense, and submit concurrently with its execution of this Agreement, policies of insurance as set forth in “Exhibit E” (the “Insurance Requirements”) which is incorporated herein by this reference and expressly made a part hereof. 5.2 Proof of Insurance. Contracting Party shall provide Certificate of Insurance to Agency along with all required endorsements. Certificate of Insurance and endorsements must be approved by Agency’s Risk Manager prior to commencement of performance. 6. INDEMNIFICATION. 6.1 Indemnification. To the fullest extent permitted by law, Contracting Party shall indemnify, protect, defend (with counsel selected by City), and hold harmless City and any and all of its officers, employees, agents, and volunteers as set forth in “Exhibit F” (“Indemnification”) which is incorporated herein by this reference and expressly made a part hereof. 7. RECORDS AND REPORTS. 7.1 Reports. Contracting Party shall periodically prepare and submit to the Contract Officer, or assigned designee, such reports concerning Contracting Party’s performance of the Services required by this 44 Page 9 of 34 Agreement as the Contract Officer, or assigned designee, shall require. Contracting Party hereby acknowledges that City is greatly concerned about the cost of the Services to be performed pursuant to this Agreement. For this reason, Contracting Party agrees that if Contracting Party becomes aware of any facts, circumstances, techniques, or events that may or will materially increase or decrease the cost of the Services contemplated herein or, if Contracting Party is providing design services, the cost of the project being designed, Contracting Party shall promptly notify the Contract Officer, or assigned designee, of said fact, circumstance, technique, or event and the estimated increased or decreased cost related thereto and, if Contracting Party is providing design services, the estimated increased or decreased cost estimate for the project being designed. 7.2 Records. Contracting Party shall keep, and require any subcontractors to keep, such ledgers, books of accounts, invoices, vouchers, canceled checks, reports (including but not limited to payroll reports), studies, or other documents relating to the disbursements charged to City and the Services performed hereunder (the “Books and Records”), as shall be necessary to perform the Services required by this Agreement and enable the Contract Officer, or assigned designee, to evaluate the performance of such Services. Any and all such Books and Records shall be maintained in accordance with generally accepted accounting principles and shall be complete and detailed. The Contract Officer, or assigned designee, shall have full and free access to such Books and Records at all times during normal business hours of City, including the right to inspect, copy, audit, and make records and transcripts from such Books and Records. Such Books and Records shall be maintained for a period of three (3) years following completion of the Services hereunder, and City shall have access to such Books and Records in the event any audit is required. In the event of dissolution of Contracting Party’s business, custody of the Books and Records may be given to City, and access shall be provided by Contracting Party’s successor in interest. Under California Government Code Section 8546.7, if the amount of public funds expended under this Agreement exceeds Ten Thousand Dollars ($10,000.00), this Agreement shall be subject to the examination and audit of the State Auditor, at the request of City or as part of any audit of City, for a period of three (3) years after final payment under this Agreement. 7.3 Ownership of Documents. All drawings, specifications, maps, designs, photographs, studies, surveys, data, notes, computer files, reports, records, documents, and other materials plans, drawings, estimates, test data, survey results, models, renderings, and other documents or works of authorship fixed in any tangible medium of 45 Page 10 of 34 expression, including but not limited to, physical drawings, digital renderings, or data stored digitally, magnetically, or in any other medium prepared or caused to be prepared by Contracting Party, its employees, subcontractors, and agents in the performance of this Agreement (the “Documents and Materials”) shall be the property of City and shall be delivered to City upon request of the Contract Officer, or assigned designee, or upon the expiration or termination of this Agreement, and Contracting Party shall have no claim for further employment or additional compensation as a result of the exercise by City of its full rights of ownership use, reuse, or assignment of the Documents and Materials hereunder. Any use, reuse or assignment of such completed Documents and Materials for other projects and/or use of uncompleted documents without specific written authorization by Contracting Party will be at City’s sole risk and without liability to Contracting Party, and Contracting Party’s guarantee and warranties shall not extend to such use, revise, or assignment. Contracting Party may retain copies of such Documents and Materials for its own use. Contracting Party shall have an unrestricted right to use the concepts embodied therein. All subcontractors shall provide for assignment to City of any Documents and Materials prepared by them, and in the event Contracting Party fails to secure such assignment, Contracting Party shall indemnify City for all damages resulting therefrom. 7.4 In the event City or any person, firm, or corporation authorized by City reuses said Documents and Materials without written verification or adaptation by Contracting Party for the specific purpose intended and causes to be made or makes any changes or alterations in said Documents and Materials, City hereby releases, discharges, and exonerates Contracting Party from liability resulting from said change. The provisions of this clause shall survive the termination or expiration of this Agreement and shall thereafter remain in full force and effect. 7.5 Licensing of Intellectual Property. This Agreement creates a non-exclusive and perpetual license for City to copy, use, modify, reuse, or sublicense any and all copyrights, designs, rights of reproduction, and other intellectual property embodied in the Documents and Materials. Contracting Party shall require all subcontractors, if any, to agree in writing that City is granted a non-exclusive and perpetual license for the Documents and Materials the subcontractor prepares under this Agreement. Contracting Party represents and warrants that Contracting Party has the legal right to license any and all of the Documents and Materials. Contracting Party makes no such representation and warranty in regard to the Documents and Materials which were prepared by design professionals other than Contracting Party or provided to Contracting Party by City. City shall not be limited in any way in its use of the Documents and Materials at any time, provided that any such use not within the 46 Page 11 of 34 purposes intended by this Agreement shall be at City’s sole risk. 7.6 Release of Documents. The Documents and Materials shall not be released publicly without prior written approval of the Contract Officer, or assigned designee, or as required by law. Contracting Party shall not disclose to any other entity or person any information regarding the activities of City, except as required by law or as authorized by City. 7.7 Confidential or Personal Identifying Information. Contracting Party covenants that all City data, data lists, trade secrets, documents with personal identifying information, documents that are not public records, draft documents, discussion notes, or other information, if any, developed or received by Contracting Party or provided for performance of this Agreement are deemed confidential and shall not be disclosed by Contracting Party to any person or entity without prior written authorization by City or unless required by law. City shall grant authorization for disclosure if required by any lawful administrative or legal proceeding, court order, or similar directive with the force of law. All City data, data lists, trade secrets, documents with personal identifying information, documents that are not public records, draft documents, discussions, or other information shall be returned to City upon the termination or expiration of this Agreement. Contracting Party’s covenant under this section shall survive the termination or expiration of this Agreement. 8. ENFORCEMENT OF AGREEMENT. 8.1 California Law. This Agreement shall be interpreted, construed, and governed both as to validity and to performance of the parties in accordance with the laws of the State of California. Legal actions concerning any dispute, claim, or matter arising out of or in relation to this Agreement shall be instituted in the Superior Court of the County of Riverside, State of California, or any other appropriate court in such county, and Contracting Party covenants and agrees to submit to the personal jurisdiction of such court in the event of such action. 8.2 Disputes. In the event of any dispute arising under this Agreement, the injured party shall notify the injuring party in writing of its contentions by submitting a claim therefore. The injured party shall continue performing its obligations hereunder so long as the injuring party commences to cure such default within ten (10) days of service of such notice and completes the cure of such default within forty-five (45) days after service of the notice, or such longer period as may be permitted by the Contract Officer, or assigned designee; provided that if the default is an immediate danger to the health, safety, or general welfare, City may take such immediate action as City deems warranted. 47 Page 12 of 34 Compliance with the provisions of this Section shall be a condition precedent to termination of this Agreement for cause and to any legal action, and such compliance shall not be a waiver of any party’s right to take legal action in the event that the dispute is not cured, provided that nothing herein shall limit City’s right to terminate this Agreement without cause pursuant to this Article 8.0. During the period of time that Contracting Party is in default, City shall hold all invoices and shall, when the default is cured, proceed with payment on the invoices. In the alternative, City may, in its sole discretion, elect to pay some or all of the outstanding invoices during any period of default. 8.3 Retention of Funds. City may withhold from any monies payable to Contracting Party sufficient funds to compensate City for any losses, costs, liabilities, or damages it reasonably believes were suffered by City due to the default of Contracting Party in the performance of the Services required by this Agreement. 8.4 Waiver. No delay or omission in the exercise of any right or remedy of a non-defaulting party on any default shall impair such right or remedy or be construed as a waiver. City’s consent or approval of any act by Contracting Party requiring City’s consent or approval shall not be deemed to waive or render unnecessary City’s consent to or approval of any subsequent act of Contracting Party. Any waiver by either party of any default must be in writing and shall not be a waiver of any other default concerning the same or any other provision of this Agreement. 8.5 Rights and Remedies are Cumulative. Except with respect to rights and remedies expressly declared to be exclusive in this Agreement, the rights and remedies of the parties are cumulative and the exercise by either party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other party. 8.6 Legal Action. In addition to any other rights or remedies, either party may take legal action, at law or at equity, to cure, correct, or remedy any default, to recover damages for any default, to compel specific performance of this Agreement, to obtain declaratory or injunctive relief, or to obtain any other remedy consistent with the purposes of this Agreement. 8.7 Termination Prior To Expiration of Term. This Section shall govern any termination of this Agreement, except as specifically provided in the following Section for termination for cause. City reserves the right to terminate this Agreement at any time, with or without cause, upon thirty (30) days’ written notice to Contracting Party. Upon receipt of any notice of 48 Page 13 of 34 termination, Contracting Party shall immediately cease all Services hereunder except such as may be specifically approved by the Contract Officer, or assigned designee. Contracting Party shall be entitled to compensation for all Services rendered prior to receipt of the notice of termination and for any Services authorized by the Contract Officer, or assigned designee, thereafter in accordance with the Schedule of Compensation or such as may be approved by the Contract Officer, or assigned designee, except amounts held as a retention pursuant to this Agreement. 8.8 Termination for Default of Contracting Party. If termination is due to the failure of Contracting Party to fulfill its obligations under this Agreement, Contracting Party shall vacate any City-owned property which Contracting Party is permitted to occupy hereunder and City may, after compliance with the provisions of Section 8.2, take over the Services and prosecute the same to completion by contract or otherwise, and Contracting Party shall be liable to the extent that the total cost for completion of the Services required hereunder exceeds the compensation herein stipulated (provided that City shall use reasonable efforts to mitigate such damages), and City may withhold any payments to Contracting Party for the purpose of setoff or partial payment of the amounts owed City. 8.9 Atto rne ys’ F e e s . If either party to this Agreement is required to initiate or defend or made a party to any action or proceeding in any way connected with this Agreement, the prevailing party in such action or proceeding, in addition to any other relief which may be granted, whether legal or equitable, shall be entitled to reasonable attorneys’ fees; provided, however, that the attorneys’ fees awarded pursuant to this Section shall not exceed the hourly rate paid by City for legal services multiplied by the reasonable number of hours spent by the prevailing party in the conduct of the litigation. Attorneys’ fees shall include attorneys’ fees on any appeal, and in addition a party entitled to attorneys’ fees shall be entitled to all other reasonable costs for investigating such action, taking depositions and discovery, and all other necessary costs the court allows which are incurred in such litigation. All such fees shall be deemed to have accrued on commencement of such action and shall be enforceable whether or not such action is prosecuted to judgment. The court may set such fees in the same action or in a separate action brought for that purpose. 9. CITY OFFICERS AND EMPLOYEES; NONDISCRIMINATION. 9.1 Non-liability of City Officers and Employees. No officer, official, employee, agent, representative, or volunteer of City shall be personally liable to Contracting Party, or any successor in interest, in the event or 49 Page 14 of 34 any default or breach by City or for any amount which may become due to Contracting Party or to its successor, or for breach of any obligation of the terms of this Agreement. 9.2 Conflict of Interest. Contracting Party covenants that neither it, nor any officer or principal of it, has or shall acquire any interest, directly or indirectly, which would conflict in any manner with the interests of City or which would in any way hinder Contracting Party’s performance of the Services under this Agreement. Contracting Party further covenants that in the performance of this Agreement, no person having any such interest shall be employed by it as an officer, employee, agent, or subcontractor without the express written consent of the Contract Officer, or assigned designee. Contracting Party agrees to at all times avoid conflicts of interest or the appearance of any conflicts of interest with the interests of City in the performance of this Agreement. No officer or employee of City shall have any financial interest, direct or indirect, in this Agreement nor shall any such officer or employee participate in any decision relating to this Agreement which effects his financial interest or the financial interest of any corporation, partnership or association in which he is, directly or indirectly, interested, in violation of any State statute or regulation. Contracting Party warrants that it has not paid or given and will not pay or give any third party any money or other consideration for obtaining this Agreement. 9.3 Covenant against Discrimination. Contracting Party covenants that, by and for itself, its heirs, executors, assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of any impermissible classification including, but not limited to, race, color, creed, religion, sex, marital status, sexual orientation, national origin, or ancestry in the performance of this Agreement. Contracting Party shall take affirmative action to ensure that applicants are employed and that employees are treated during employment without regard to their race, color, creed, religion, sex, marital status, sexual orientation, national origin, or ancestry. 10. MISCELLANEOUS PROVISIONS. 10.1 Notice. Any notice, demand, request, consent, approval, or communication either party desires or is required to give the other party or any other person shall be in writing and either served personally or sent by prepaid, first-class mail to the address set forth below. Either party may change its address by notifying the other party of the change of address in writing. Notice shall be deemed communicated forty-eight 50 Page 15 of 34 (48) hours from the time of mailing if mailed as provided in this Section. To City: CITY OF LA QUINTA ATTN: Executive Director 78495 Calle Tampico La Quinta, CA 92253 To Contracting Party: LA QUINTA PALMS REALTY ATTN: Jim Cathcart 51001 Eisenhower Dr, La Quinta, CA 92253 51 Page 16 of 34 10.2 Interpretation. The terms of this Agreement shall be construed in accordance with the meaning of the language used and shall not be construed for or against either party by reason of the authorship of this Agreement or any other rule of construction which might otherwise apply. 10.3 Section Headings and Subheadings. The section headings and subheadings contained in this Agreement are included for convenience only and shall not limit or otherwise affect the terms of this Agreement. 10.4 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed to be an original, and such counterparts shall constitute one and the same instrument 10.5 Integrated Agreement. This Agreement including the exhibits hereto is the entire, complete, and exclusive expression of the understanding of the parties. It is understood that there are no oral agreements between the parties hereto affecting this Agreement and this Agreement supersedes and cancels any and all previous negotiations, arrangements, agreements, and understandings, if any, between the parties, and none shall be used to interpret this Agreement. 10.6 Amendment. No amendment to or modification of this Agreement shall be valid unless made in writing and approved by Contracting Party and by the City Council of City. The parties agree that this requirement for written modifications cannot be waived and that any attempted waiver shall be void. 10.7 Severability. In the event that any one or more of the articles, phrases, sentences, clauses, paragraphs, or sections contained in this Agreement shall be declared invalid or unenforceable, such invalidity or unenforceability shall not affect any of the remaining articles, phrases, sentences, clauses, paragraphs, or sections of this Agreement which are hereby declared as severable and shall be interpreted to carry out the intent of the parties hereunder unless the invalid provision is so material that its invalidity deprives either party of the basic benefit of their bargain or renders this Agreement meaningless. 10.8 Unfair Business Practices Claims. In entering into this Agreement, Contracting Party offers and agrees to assign to City all rights, title, and interest in and to all causes of action it may have under Section 4 of the Clayton Act (15 U.S.C. § 15) or under the Cartwright Act (Chapter 2, (commencing with Section 16700) of Part 2 of Division 7 of the Business and Professions Code), arising from purchases of goods, services, or materials related to this Agreement. This assignment shall be made 52 Page 17 of 34 and become effective at the time City renders final payment to Contracting Party without further acknowledgment of the parties. 10.9 No Third-Party Beneficiaries. With the exception of the specific provisions set forth in this Agreement, there are no intended third- party beneficiaries under this Agreement and no such other third parties shall have any rights or obligations hereunder. 10.10 Authority. The persons executing this Agreement on behalf of each of the parties hereto represent and warrant that (i) such party is duly organized and existing, (ii) they are duly authorized to execute and deliver this Agreement on behalf of said party, (iii) by so executing this Agreement, such party is formally bound to the provisions of this Agreement, and (iv) that entering into this Agreement does not violate any provision of any other Agreement to which said party is bound. This Agreement shall be binding upon the heirs, executors, administrators, successors, and assigns of the parties. [SIGNATURES ON FOLLOWING PAGE] 53 Page 18 of 34 IN WITNESS WHEREOF, the parties have executed this Agreement as of the dates stated below. CITY OF LA QUINTA, CONTRACTING PARTY: a California Municipal Corporation ___________________________ _________________________ JON MCMILLEN, Executive Director JIM CATHCART of Housing Authority Manager City of La Quinta , California Dated: ___________________________ ATTEST: ___________________________ MONIKA RADEVA, City Clerk La Quinta, California APPROVED AS TO FORM: ___________________________ WILLIAM H. IHRKE, City Attorney City of La Quinta, California 54 Exhibit A Page 1 of 1 Exhibit A Scope of Services [See Attached] 55 Exhibit B Page 1 of 1 Exhibit B Schedule of Compensation With the exception of compensation for Additional Services, provided for in Section 2.3 of this Agreement, the maximum total compensation to be paid to Contracting Party under this Agreement is not to exceed One Hundred Twenty Six Thousand Dollars ($126,000) (“Contract Sum”) during the initial term (amounting to no more than $3,500 per month as payment). There is an option for two extensions, each being one (1) year, with an increase of 5% for the total annual payment is allowed, with the monthly payment not -to-exceed $3,675, and the annual payment not- to-exceed $44,100. The Total Contract Sum w/ Extensions is a not-to- exceed amount of $214,200. This information is provided in the below table. Year Monthly Base Annual Base 2020/2021 $3,500 $42,000 2021/2022 $3,500 $42,000 2022/2023 $3,500 $42,000 Initial 3-year Term $126,000 2023/2024 $3,675 $44,100 2024/2025 $3,675 $44,100 Optional extensions (2-years) $88,200 TOTAL Contract not to exceed $214,200 56 Exhibit C Page 1 of 1 Exhibit C Schedule of Performance Contracting Party shall complete all services identified in the Scope of Services, Exhibit A of this Agreement, in accordance with the Project Schedule identified in Exhibit A of this Agreement, attached hereto and incorporated herein by this reference. 57 Exhibit D Page 1 of 1 Exhibit D Special Requirements None 58 Exhibit F Page 1 of 12 Exhibit E Insurance Requirements E.1 Insurance. Prior to the beginning of and throughout the duration of this Agreement, the following policies shall be maintained and kept in full force and effect providing insurance with minimum limits as indicated below and issued by insurers with A.M. Best ratings of no less than A-VI: Commercial General Liability (at least as broad as ISO CG 0001) $1,000,000 (per occurrence) $2,000,000 (general aggregate) Must include the following endorsements: General Liability Additional Insured General Liability Primary and Non-contributory Commercial Auto Liability (at least as broad as ISO CA 0001) $1,000,000 (per accident) Personal Auto Declaration Page if applicable Errors and Omissions Liability $1,000,000 (per claim and aggregate) Workers’ Compensation (per statutory requirements) 1. Must include the following endorsements: Workers Compensation with Waiver of Subrogation Workers Compensation Declaration of Sole Proprietor if applicable 59 Exhibit F Page 2 of 12 Cyber Liability $1,000,000 (per occurrence) $2,000,000 (general aggregate) Contracting Party shall procure and maintain, at its cost, and submit concurrently with its execution of this Agreement, Commercial General Liability insurance against all claims for injuries against persons or damages to property resulting from Contracting Party’s acts or omissions rising out of or related to Contracting Party’s performance under this Agreement. The insurance policy shall contain a severability of interest clause providing that the coverage shall be primary for losses arising out of Contracting Party’s performance hereunder and neither City nor its insurers shall be required to contribute to any such loss. An endorsement evidencing the foregoing and naming the City and its officers and employees as additional insured (on the Commercial General Liability policy only) must be submitted concurrently with the execution of this Agreement and approved by City prior to commencement of the services hereunder. Contracting Party shall carry automobile liability insurance of $1,000,000 per accident against all claims for injuries against persons or damages to property arising out of the use of any automobile by Contracting Party, its officers, any person directly or indirectly employed by Contracting Party, any subcontractor or agent, or anyone for whose acts any of them may be liable, arising directly or indirectly out of or related to Contracting Party’s performance under this Agreement. If Contracting Party or Contracting Party’s employees will use personal autos in any way on this project, Contracting Party shall provide evidence of personal auto liability coverage for each such person. The term “automobile” includes, but is not limited to, a land motor vehicle, trailer or semi-trailer designed for travel on public roads. The automobile insurance policy shall contain a severability of interest clause providing that coverage shall be primary for losses arising out of Contracting Party’s performance hereunder and neither City nor its insurers shall be required to contribute to such loss. 60 Exhibit F Page 3 of 12 Professional Liability or Errors and Omissions Insurance as appropriate shall be written on a policy form coverage specifically designed to protect against acts, errors or omissions of the Contracting Party and “Covered Professional Services” as designated in the policy must specifically include work performed under this agreement. The policy limit shall be no less than $1,000,000 per claim and in the aggregate. The policy must “pay on behalf of” the insured and must include a provision establishing the insurer’s duty to defend. The policy retroactive date shall be on or before the effective date of this agreement. Contracting Party shall carry Workers’ Compensation Insurance in accordance with State Worker’s Compensation laws with employer’s liability limits no less than $1,000,000 per accident or disease. Contracting Party shall procure and maintain Cyber Liability insurance with limits of $1,000,000 per occurrence/loss which shall include the following coverage: a. Liability arising from the theft, dissemination and/or use of confidential or personally identifiable information; including credit monitoring and regulatory fines arising from such theft, dissemination or use of the confidential information. b. Network security liability arising from the unauthorized use of, access to, or tampering with computer systems. c. Liability arising from the failure of technology products (software) required under the contract for Consultant to properly perform the services intended. d. Electronic Media Liability arising from personal injury, plagiarism or misappropriation of ideas, domain name infringement or improper deep-linking or framing, and infringement or violation of intellectual property rights. e. Liability arising from the failure to render professional 61 Exhibit F Page 4 of 12 services. If coverage is maintained on a claims-made basis, Contracting Party shall maintain such coverage for an additional period of three (3) years following termination of the contract. Contracting Party shall provide written notice to City within ten (10) working days if: (1) any of the required insurance policies is terminated; (2) the limits of any of the required polices are reduced; or (3) the deductible or self-insured retention is increased. In the event any of said policies of insurance are cancelled, Contracting Party shall, prior to the cancellation date, submit new evidence of insurance in conformance with this Exhibit to the Contract Officer. The procuring of such insurance or the delivery of policies or certificates evidencing the same shall not be construed as a limitation of Contracting Party’s obligation to indemnify City, its officers, employees, contractors, subcontractors, or agents. E.2 Remedies. In addition to any other remedies City may have if Contracting Party fails to provide or maintain any insurance policies or policy endorsements to the extent and within the time herein required, City may, at its sole option: a. Obtain such insurance and deduct and retain the amount of the premiums for such insurance from any sums due under this Agreement. b. Order Contracting Party to stop work under this Agreement and/or withhold any payment(s) which become due to Contracting Party hereunder until Contracting Party demonstrates compliance with the requirements hereof. c. Terminate this Agreement. Exercise of any of the above remedies, however, is an alternative to any other remedies City may have. The above remedies are not the exclusive remedies for Contracting Party’s failure to maintain or secure appropriate policies or endorsements. Nothing herein contained shall be construed as limiting in any way the extent to which Contracting Party may be held responsible for payments of 62 Exhibit F Page 5 of 12 damages to persons or property resulting from Contracting Party’s or its subcontractors’ performance of work under this Agreement. E.3 General Conditions Pertaining to Provisions of Insurance Coverage by Contracting Party. Contracting Party and City agree to the following with respect to insurance provided by Contracting Party: 1. Contracting Party agrees to have its insurer endorse the third party general liability coverage required herein to include as additional insureds City, its officials, employees, and agents, using standard ISO endorsement No. CG 2010 with an edition prior to 1992. Contracting Party also agrees to require all contractors, and subcontractors to do likewise. 2. No liability insurance coverage provided to comply with this Agreement shall prohibit Contracting Party, or Contracting Party’s employees, or agents, from waiving the right of subrogation prior to a loss. Contracting Party agrees to waive subrogation rights against City regardless of the applicability of any insurance proceeds, and to require all contractors and subcontractors to do likewise. 3. All insurance coverage and limits provided by Contracting Party and available or applicable to this Agreement are intended to apply to the full extent of the policies. Nothing contained in this Agreement or any other agreement relating to City or its operations limits the application of such insurance coverage. 4. None of the coverages required herein will be in compliance with these requirements if they include any limiting endorsement of any kind that has not been first submitted to City and approved of in writing. 5. No liability policy shall contain any provision or definition that would serve to eliminate so-called “third party action over” claims, including any exclusion for bodily injury to an employee of the insured or of any contractor or subcontractor. 6. All coverage types and limits required are subject to approval, modification and additional requirements by the City, as the 63 Exhibit F Page 6 of 12 need arises. Contracting Party shall not make any reductions in scope of coverage (e.g. elimination of contractual liability or reduction of discovery period) that may affect City’s protection without City’s prior written consent. 7. Proof of compliance with these insurance requirements, consisting of certificates of insurance evidencing all the coverages required and an additional insured endorsement to Contracting Party’s general liability policy, shall be delivered to City at or prior to the execution of this Agreement. In the event such proof of any insurance is not delivered as required, or in the event such insurance is canceled at any time and no replacement coverage is provided, City has the right, but not the duty, to obtain any insurance it deems necessary to protect its interests under this or any other agreement and to pay the premium. Any premium so paid by City shall be charged to and promptly paid by Contracting Party or deducted from sums due Contracting Party, at City option. 8. It is acknowledged by the parties of this agreement that all insurance coverage required to be provided by Contracting Party or any subcontractor, is intended to apply first and on a primary, non- contributing basis in relation to any other insurance or self-insurance available to City. 9. Contracting Party agrees to ensure that subcontractors, and any other party involved with the project that is brought onto or involved in the project by Contracting Party, provide the same minimum insurance coverage required of Contracting Party. Contracting Party agrees to monitor and review all such coverage and assumes all responsibility for ensuring that such coverage is provided in conformity with the requirements of this section. Contracting Party agrees that upon request, all agreements with subcontractors and others engaged in the project will be submitted to City for review. 10. Contracting Party agrees not to self-insure or to use any self- insured retentions or deductibles on any portion of the insurance required herein (with the exception of professional liability coverage, if required) and further agrees that it will not allow any contractor, 64 Exhibit F Page 7 of 12 subcontractor, Architect, Engineer or other entity or person in any way involved in the performance of work on the project contemplated by this agreement to self-insure its obligations to City. If Contracting Party’s existing coverage includes a deductible or self-insured retention, the deductible or self-insured retention must be declared to the City. At that time the City shall review options with the Contracting Party, which may include reduction or elimination of the deductible or self-insured retention, substitution of other coverage, or other solutions. 11. The City reserves the right at any time during the term of this Agreement to change the amounts and types of insurance required by giving the Contracting Party ninety (90) days advance written notice of such change. If such change results in substantial additional cost to the Contracting Party, the City will negotiate additional compensation proportional to the increased benefit to City. 12. For purposes of applying insurance coverage only, this Agreement will be deemed to have been executed immediately upon any party hereto taking any steps that can be deemed to be in furtherance of or towards performance of this Agreement. 13. Contracting Party acknowledges and agrees that any actual or alleged failure on the part of City to inform Contracting Party of non- compliance with any insurance requirement in no way imposes any additional obligations on City nor does it waive any rights hereunder in this or any other regard. 14. Contracting Party will renew the required coverage annually as long as City, or its employees or agents face an exposure from operations of any type pursuant to this agreement. This obligation applies whether the agreement is canceled or terminated for any reason. Termination of this obligation is not effective until City executes a written statement to that effect. 15. Contracting Party shall provide proof that policies of insurance required herein expiring during the term of this Agreement have been renewed or replaced with other policies providing at least the same coverage. Proof that such coverage has been ordered shall 65 Exhibit F Page 8 of 12 be submitted prior to expiration. A coverage binder or letter from Contracting Party’s insurance agent to this effect is acceptable. A certificate of insurance and an additional insured endorsement is required in these specifications applicable to the renewing or new coverage must be provided to City within five (5) days of the expiration of coverages. 16. The provisions of any workers’ compensation or similar act will not limit the obligations of Contracting Party under this agreement. Contracting Party expressly agrees not to use any statutory immunity defenses under such laws with respect to City, its employees, officials, and agents. 17. Requirements of specific coverage features, or limits contained in this section are not intended as limitations on coverage, limits or other requirements nor as a waiver of any coverage normally provided by any given policy. Specific reference to a given coverage feature is for purposes of clarification only as it pertains to a given issue and is not intended by any party or insured to be limiting or all-inclusive. 18. These insurance requirements are intended to be separate and distinct from any other provision in this Agreement and are intended by the parties here to be interpreted as such. 19. The requirements in this Exhibit supersede all other sections and provisions of this Agreement to the extent that any other section or provision conflicts with or impairs the provisions of this Exhibit. 20. Contracting Party agrees to be responsible for ensuring that no contract used by any party involved in any way with the project reserves the right to charge City or Contracting Party for the cost of additional insurance coverage required by this agreement. Any such provisions are to be deleted with reference to City. It is not the intent of City to reimburse any third party for the cost of complying with these requirements. There shall be no recourse against City for payment of premiums or other amounts with respect thereto. 21. Contracting Party agrees to provide immediate notice to City of any claim or loss against Contracting Party arising out of the work 66 Exhibit F Page 9 of 12 performed under this agreement. City assumes no obligation or liability by such notice, but has the right (but not the duty) to monitor the handling of any such claim or claims if they are likely to involve City. 67 Exhibit F Page 10 of 12 Exhibit F Indemnification F.1 Indemnity for the Benefit of City. a. Indemnification for Professional Liability. When the law establishes a professional standard of care for Contracting Party’s Services, to the fullest extent permitted by law, Contracting Party shall indemnify, protect, defend (with counsel selected by City), and hold harmless City and any and all of its officials, employees, and agents (“Indemnified Parties”) from and against any and all claims, losses, liabilities of every kind, nature, and description, damages, injury (including, without limitation, injury to or death of an employee of Contracting Party or of any subcontractor), costs and expenses of any kind, whether actual, alleged or threatened, including, without limitation, incidental and consequential damages, court costs, attorneys’ fees, litigation expenses, and fees of expert consultants or expert witnesses incurred in connection therewith and costs of investigation, to the extent same are caused in whole or in part by any negligent or wrongful act, error or omission of Contracting Party, its officers, agents, employees or subcontractors (or any entity or individual that Contracting Party shall bear the legal liability thereof) in the performance of professional services under this agreement. With respect to the design of public improvements, the Contracting Party shall not be liable for any injuries or property damage resulting from the reuse of the design at a location other than that specified in Exhibit A without the written consent of the Contracting Party. b. Indemnification for Other Than Professional Liability. Other than in the performance of professional services and to the full extent permitted by law, Contracting Party shall indemnify, defend (with counsel selected by City), and hold harmless the Indemnified Parties from and against any liability (including liability for claims, suits, actions, arbitration proceedings, administrative proceedings, 68 Exhibit F Page 11 of 12 regulatory proceedings, losses, expenses or costs of any kind, whether actual, alleged or threatened, including, without limitation, incidental and consequential damages, court costs, attorneys’ fees, litigation expenses, and fees of expert consultants or expert witnesses) incurred in connection therewith and costs of investigation, where the same arise out of, are a consequence of, or are in any way attributable to, in whole or in part, the performance of this Agreement by Contracting Party or by any individual or entity for which Contracting Party is legally liable, including but not limited to officers, agents, employees, or subcontractors of Contracting Party. c. Indemnity Provisions for Contracts Related to Construction (Limitation on Indemnity). Without affecting the rights of City under any provision of this agreement, Contracting Party shall not be required to indemnify and hold harmless City for liability attributable to the active negligence of City, provided such active negligence is determined by agreement between the parties or by the findings of a court of competent jurisdiction. In instances where City is shown to have been actively negligent and where City’s active negligence accounts for only a percentage of the liability involved, the obligation of Contracting Party will be for that entire portion or percentage of liability not attributable to the active negligence of City. d. Indemnification Provision for Design Professionals. 1. Applicability of this Section F.1(d). Notwithstanding Section F.1(a) hereinabove, the following indemnification provision shall apply to a Contracting Party who constitutes a “design professional” as the term is defined in paragraph 3 below. 2. Scope of Indemnification. When the law establishes a professional standard of care for Contracting Party’s Services, to the fullest extent permitted by law, Contracting Party shall indemnify and hold harmless City and any and all of its officials, employees, and agents (“Indemnified Parties”) from and against any and all losses, liabilities of every kind, nature, and description, damages, injury (including, without limitation, injury to or death of an employee of Contracting Party or of any subcontractor), costs and expenses, including, without 69 Exhibit F Page 12 of 12 limitation, incidental and consequential damages, court costs, reimbursement of attorneys’ fees, litigation expenses, and fees of expert consultants or expert witnesses incurred in connection therewith and costs of investigation, to the extent same are caused by any negligent or wrongful act, error or omission of Contracting Party, its officers, agents, employees or subcontractors (or any entity or individual that Contracting Party shall bear the legal liability thereof) in the performance of professional services under this agreement. With respect to the design of public improvements, the Contracting Party shall not be liable for any injuries or property damage resulting from the reuse of the design at a location other than that specified in Exhibit A without the written consent of the Contracting Party. 3. Design Professional Defined. As used in this Section F.1(d), the term “design professional” shall be limited to licensed architects, registered professional engineers, licensed professional land surveyors and landscape architects, all as defined under current law, and as may be amended from time to time by Civil Code § 2782.8. F.2 Obligation to Secure Indemnification Provisions. Contracting Party agrees to obtain executed indemnity agreements with provisions identical to those set forth herein this Exhibit F, as applicable to the Contracting Party, from each and every subcontractor or any other person or entity involved by, for, with or on behalf of Contracting Party in the performance of this Agreement. In the event Contracting Party fails to obtain such indemnity obligations from others as required herein, Contracting Party agrees to be fully responsible according to the terms of this Exhibit. Failure of City to monitor compliance with these requirements imposes no additional obligations on City and will in no way act as a waiver of any rights hereunder. This obligation to indemnify and defend City as set forth in this Agreement are binding on the successors, assigns or heirs of Contracting Party and shall survive the termination of this Agreement. 70 City of La Quinta HOUSING AUTHORITY MEETING: May 19, 2020 STAFF REPORT AGENDA TITLE: DISCUSS FISCAL YEAR 2020/21 PROPOSED HOUSING AUTHORITY BUDGET RECOMMENDATION Discuss Fiscal Year 2020/21 Proposed Housing Authority Budget. EXECUTIVE SUMMARY •The proposed 2020/21 Housing Authority (Authority) Budget is presented to the Authority for review. •The Housing Commission (Commission) reviewed and approved the proposed budget on May 6, 2020. •The proposed HA budget, when all funds are combined, has a surplus of $486,267. •Final budget adoption is scheduled for June 16, 2020. FISCAL IMPACT The preliminary Authority budget projects revenues of $1,601,067 (inclusive of the annual loan repayment) and expenditures of $1,114,800. Unappropriated loan repayment revenues of $647,767 will remain in housing reserves. BACKGROUND/ANALYSIS Each Housing Fund section contains extensive notes to explain 2018/19 actuals, changes in 2019/20, and projections for 2020/21. The budget format is similar to the prior fiscal year with additional comparison summary charts. The Commission reviewed and approved the proposed budget on May 6, 2020. If there are no further significant recommendations for adjustments at either meeting, the final budget will be adopted by the Authority on June 16, 2020. Should there be substantial changes (an increase or decrease of more than 10% in revenues or expenses), the proposed budget would be presented to the Commission and Authority for reapproval prior to adoption. STUDY SESSION ITEM NO. 1 71 The Commission has a regularly scheduled meeting on June 10, 2020. Attachment 1 provides a narrative of Authority revenue and expenses including the Redevelopment Agency loan repayment to the Authority. Line item details for these revenues and expenses are located in Exhibit A of the Attachment. ALTERNATIVES The Commission may recommend further adjustments to the budget. Per State law, the Authority must adopt a budget by June 30,2020. Prepared by: Karla Romero, Agency Finance Director Approved by: Jon McMillen, Agency Director Attachment: 1. Fiscal Year 2020/21 Proposed Budget 72 Housing Authority 2020/21 PROPOSED BUDGET The Housing Authority budget provides resources for the evaluation of future affordable housing projects and programs, ongoing operational needs and property maintenance, as well as legal and auditing services as required for the Authority. COVID-19 impacts continue to be evaluated and play a key role in budgetary discussions. With unemployment rates rising and unknown economic conditions for the foreseeable future, affordable housing will play a key role for communities. At the same time, many municipal and state governments are also facing revenue shortfalls while striving to maintain appropriate service levels. La Quinta is not imune to these challeges. However, the City and Authority have been prudent in their use of revenues, leveraging external resources for affordable housing projects, establishing effective external partnerships, and long-term financial planning. The 2020/21 Authority budget has three active funds restricted to housing operations. Line item details for these revenues and expenses are located in Exhibit A. REVENUES When all funds are combined, there is no significant anticipated change in revenues from the original 2019/20 budget to the proposed 2020/21 budget. Due to higher fund balances, interest earnings remain strong in all funds. However, as investments mature under current economic conditions, these revenues will decline accordingly. Second trust deed repayments have been lowered due to unpredictable home sales. Sale of other assets in 2019/20 for $1,061,456 reflect Housing Authority land purchased by the City on Dune Palms. Repayments and land purchases are typically recognized with a quarterly budget adjustment when they are received or are anticipated to occur. The RDA Low-Mod Housing Fund recognizes the annual loan repayment from the Last and Final Recognized Obligation Payment Schedule (ROPS) for the Successor Agency FUND #FUND NAME TOTAL REVENUES TOTAL EXPENSES SURPLUS / (DEFICIT) 241 HOUSING AUTHORITY FUND 563,300 804,800 (241,500) 243*RDA LOW-MOD HOUSING FUND 687,767 250,000 437,767 249 SA 2011 LOW/MOD BOND 350,000 60,000 290,000 1,601,067 1,114,800 486,267 HOUSING AUTHORITY FUNDS SUMMARY OF REVENUES AND EXPENDITURES BY FUND FOR 2020/21 GRAND TOTAL * General Fund and RDA Low-Mod Housing Fund estimates are for unappropriated reserves and included annual Successor Agency loan repayments as approved with the last and final recognized obligation payment schedule. The repayment for FY 2020/21 is $647,767. ATTACHMENT 1 73 (former Redevelopment Agency). For 2020/21 the total loan repayment is $3,238,833, which is allocated 80% to the General Fund ($2,591,066) and 20% ($647,767) to the Housing Authority Fund. These revenues will be recognized in reserves in each fund and are not allocated to current expenses. The final loan repayment is scheduled for fiscal year 2029/30. Remaining outstanding loan repayments after 2020/21 total $31,790,103 of which $6,358,021 will be allocated to the Housing Authority. EXPENSES The operating Housing Authority Fund has new employee allocations resulting in an increase of $148,005 to salaries and benefits. The new allocations reflect current and anticipated work performed for the Authority. The transfer out in 2019/20 is for retention basin improvements next to the City’s XPark, which will be partially utilized by the authority. There are no additional transfers out proposed in 2020/21. Revenues received from loan repayments have been used for homeless programs as approved by the Authority each fiscal year. The proposed budget for 2020/21 homeless programs is $250,000. The Authority had two bond funds, one of which was exhausted with the Washington Street Apartments Project (2004 Bond) in 2019/20. The remaining 2011 Bond is anticipated to have a balance of $17.1 million at June 30, 2020 and a $60,000 budget for 2020/21 provides for the ability to evaluate future affordable housing projects and programs. 74 2020 212020CITY OF LA QUINTA HOUSING AUTHORITY PROPOSED BUDGET EXHIBIT A 75 FUND #FUND NAME ESTIMATED AVAILABLE FUND BALANCE July 1, 2020 ESTIMATED REVENUES ESTIMATED EXPENDITURES ESTIMATED ENDING FUND BALANCE June 30, 2021 241 HOUSING AUTHORITY FUND 10,800,000 563,300 804,800 10,558,500 243*RDA LOW-MOD HOUSING FUND 2,600,000 687,767 250,000 3,037,767 249 SA 2011 LOW/MOD BOND 17,100,000 350,000 60,000 17,390,000 30,500,000 1,601,067 1,114,800 30,986,267 CITY OF LA QUINTA ESTIMATED ENDING FUND BALANCES FISCAL YEAR ENDING JUNE 30, 2021 GRAND TOTAL * General Fund and RDA Low-Mod Housing Fund estimates are for unappropriated reserves and included annual Successor Agency loan repayments as approved with the last and final recognized obligation payment schedule. The repayment for FY 2020/21 is $647,767. CITY OF LA QUINTA HOUSING AUTHORITY FY 2020/21 PROPOSED BUDGET 76 As of 5/1/2020 Housing Fund Revenues 2019/20 Original 2019/20 Current Variance Original vs Current 2020/21 Proposed Variance Current vs. Proposed % Change - 241 - Housing Authority 448,000 1,688,256 1,240,256 563,300 (1,124,956)-67% 243 - RDA Low-Mod Housing 22,000 40,000 18,000 40,000 - 0% 249 - SA 2011 Low/Mod Bond 270,000 350,000 80,000 350,000 - 0% Total Revenues 740,000 2,078,256 1,338,256 953,300 (1,124,956) -54% RDA Loan Repayment 635,065 635,065 - 647,767 12,702 Total Operating Revenues 1,375,065 2,713,321 1,338,256 1,601,067 (1,112,254) Housing Fund Expenditures 2019/20 Original 2019/20 Current Variance Original vs Current 2020/21 Proposed Variance Current vs. Proposed % Change 241 - Housing Authority 609,300 990,957 381,657 804,800 (186,157) -19% 243 - RDA Low-Mod Housing 250,000 351,000 101,000 250,000 (101,000) -29% 249 - SA 2011 Low/Mod Bond 20,000 60,000 40,000 60,000 - 0% Total Expenditures 879,300 1,401,957 522,657 1,114,800 (287,157) -20% Budget Surplus/(Deficit)495,765 1,311,364 815,599 486,267 HOUSING AUTHORITY 2020/21 BUDGET SUMMARY CITY OF LA QUINTA HOUSING AUTHORITY FY 2020/21 PROPOSED BUDGET 77 2018/19Actuals2019/20Original Budget2019/20Current Budget2019/20YTD Activity*2020/21Proposed Budget20/21 vs. Current 19/20% Change in Budget241 - HOUSING AUTHORITY9101 - Housing Authority - Admin340 - Charges for Services1000 000 %241-9101-42301 Miscellaneous Revenue340 - Charges for Services Totals:1000 000 %360 - Use of Money & Property339,095110,000230,000150,852250,00020,0009 %241-9101-41900 Allocated Interest771005993003000 %241-9101-41915 Non-Allocated Interest58,814058,800118,7890(58,800)-100 %241-9101-43500 Home Sale Proceeds001,061,45600 (1,061,456)-100 %241-9101-45000 Sale of Other Assets360 - Use of Money & Property Totals:398,680110,0001,350,256 270,239250,300 (1,099,956)-81 %380 - Transfers In187,89250,00050,000025,000(25,000)-50 %241-9101-43504 2nd Trust Deed Repayme380 - Transfers In Totals:187,89250,00050,000025,000(25,000)-50 %9101 - Housing Authority - Admin Totals:586,572160,0001,400,256 270,239275,300 (1,124,956)-80 %9103 - Housing Authority - LQRP360 - Use of Money & Property286,872288,000288,000224,726288,00000 %241-9103-43502 Rent Revenue/LQRP360 - Use of Money & Property Totals:286,872288,000288,000 224,726288,00000 %9103 - Housing Authority - LQRP Totals:286,872288,000288,000 224,726288,00000 %241 - HOUSING AUTHORITY Totals:873,444448,0001,688,256 494,965563,300 (1,124,956)-67 %243 - RDA LOW-MOD HOUSING FUND0000 - Undesignated360 - Use of Money & Property55,55522,00040,00031,01840,00000 %243-0000-41900 Allocated Interest360 - Use of Money & Property Totals:55,55522,00040,00031,01840,00000 %0000 - Undesignated Totals:55,55522,00040,00031,01840,00000 %3 - RDA LOW-MOD HOUSING FUND Totals:55,55522,00040,00031,01840,00000 %248 - SA 2004 LO/MOD BOND FUND (Refin0000 - Undesignated340 - Charges for Services0001,820000 %248-0000-42305 Miscellaneous Reimbursem340 - Charges for Services Totals:0001,820000 %1000 001000 00339,095 110,000 230,000 150,852 250,000 20,0007710059930030058,814058,800118,7890(58,800)001,061,45600 (1,061,456)398,680110,0001,350,256 270,239250,300 (1,099,956)187,89250,00050,000025,000(25,000)187,89250,00050,000025,000(25,000)586,572160,0001,400,256 270,239275,300 (1,124,956)286,872288,000288,000224,726288,0000286,872288,000288,000 224,726288,0000286,872288,000288,000 224,726288,0000873,444448,0001,688,256 494,965563,300 (1,124,956)55,55522,00040,00031,01840,000055,55522,00040,00031,01840,000055,55522,00040,00031,01840,000055,55522,00040,00031,01840,00000001,820000001,82000CITY OF LA QUINTA HOUSING AUTHORITYHOUSING AUTHORITY REVENUESFY 2020/21 PROPOSED BUDGET* As of 4/27/202078 2018/19Actuals2019/20Original Budget2019/20Current Budget2019/20YTD Activity*2020/21Proposed Budget20/21 vs. Current 19/20% Change in Budget360 - Use of Money & Property17,587005,307000 %248-0000-41900 Allocated Interest360 - Use of Money & Property Totals:17,587005,307000 %0000 - Undesignated Totals:17,587007,127000 % BOND FUND (Refinanced in 2014) Totals:17,587007,127000 %249 - SA 2011 LOW/MOD BOND FUND (Re0000 - Undesignated360 - Use of Money & Property3,289005,646000 %249-0000-41900 Allocated Interest487,581270,000350,000280,502350,00000 %249-0000-41915 Non-Allocated Interest360 - Use of Money & Property Totals:490,870270,000350,000 286,148350,00000 %0000 - Undesignated Totals:490,870270,000350,000 286,148350,00000 %BOND FUND (Refinanced in 2016) Totals:490,870270,000350,000 286,148350,00000 %17,587005,3070017,587005,3070017,587007,1270017,587007,127003,289005,64600487,581270,000350,000280,502350,0000490,870270,000350,000 286,148350,0000490,870270,000350,000 286,148350,0000490,870270,000350,000 286,148350,0000CITY OF LA QUINTA HOUSING AUTHORITYHOUSING AUTHORITY REVENUESFY 2020/21 PROPOSED BUDGET* As of 4/27/2020241 Fund Second Trust Deed Payments and Home Sale Proceeds vary from year-to-year. Additional repayment of silent second trust deeds are recognized upon receipt. 241 Fund, 241-9101-45000, Sale of Other Assets revenues in FY 2019/20 reflects the purchase and sale agreement between the City of La Quinta and the La Quinta Housing Authority for property at Dune Palms Road for the Dune Palms Retention Basin and XPark projects. 248 Fund was fully used for the Washington Street Apartment rehabilitation and expansion project. 249 Fund was partially used for the Washington Street Apartment rehabilitation and expansion project. Remaining bond funds continue to earn interest and are available for future housing projects. 79 2018/19Actuals2019/20Original Budget2019/20Current Budget2019/20YTD Activity*2020/21Proposed Budget20/21 vs. Current 19/20% Change in Budget241 - HOUSING AUTHORITY9101 - Housing Authority - Admin50 - Salaries and Benefits130,085142,000143,595101,226254,800111,20577 %241-9101-50101 Permanent Full Time00040 000 %241-9101-50105 Salaries - Overtime7503,0003,0007503,00000 %241-9101-50110 Commissions & Boards196200200163400200100 %241-9101-50150 Other Compensation10,87810,60010,6008,18017,5006,90065 %241-9101-50200 PERS-City Portion2,26200210000 %241-9101-50215 Other Fringe Benefits22,12931,80031,80018,66657,50025,70081 %241-9101-50221 Medical Insurance33700256000 %241-9101-50222 Vision Insurance1,48200974000 %241-9101-50223 Dental Insurance580052000 %241-9101-50224 Life Insurance5879009004431,50060067 %241-9101-50225 Long Term Disability2,6003,4003,4002,5505,2001,80053 %241-9101-50230 Workers Comp Insurance1,9362,1002,1001,4823,7001,60076 %241-9101-50240 Social Security-Medicare920078000 %241-9101-50241 Social Security-FICA50 - Salaries and Benefits Totals:173,391194,000195,595 135,070343,600148,00576 %60 - Contract Services59,66781,000121,00053,874100,000(21,000)-17 %241-9101-60103 Professional Services5,0005,0005,0005,0005,00000 %241-9101-60106 Auditors13,45325,00025,0003,37035,00010,00040 %241-9101-60153 Attorney60 - Contract Services Totals:78,120111,000151,00062,244140,000(11,000)-7 %62 - Maintenance & Operations1,6113,0003,0001,211500(2,500)-83 %241-9101-60320 Travel & Training153000000 %241-9101-60400 Office Supplies1,3771,5001,5002,4702,00050033 %241-9101-60420 Operating Supplies62 - Maintenance & Operations Totals:3,1414,5004,5003,6812,500(2,000)-44 %63 - Insurance10,0006,0006,0004,5008,0002,00033 %241-9101-91843 Property & Crime Insuran63 - Insurance Totals:10,0006,0006,0004,5008,0002,00033 %69 - Internal Service Charges20,00014,00014,00010,50014,00000 %241-9101-91844 Earthquake Insurance18,10024,80024,80018,60046,70021,90088 %241-9101-98110 Information Tech Charges69 - Internal Service Charges Totals:38,10038,80038,80029,10060,70021,90056 %99 - Transfers Out00278,06200(278,062)-100 %241-9101-99900 Transfers Out99 - Transfers Out Totals:00278,06200(278,062)-100 %9101 - Housing Authority - Admin Totals:302,753354,300673,957 234,595554,800(119,157)-18 %9103 - Housing Authority - LQRP62 - Maintenance & Operations307,302255,000317,000237,455250,000(67,000)-21 %241-9103-60157 Rental Expenses130,085142,000143,595101,226254,800111,20500040 007503,0003,0007503,000019620020016340020010,87810,60010,6008,18017,5006,9002,262002100022,12931,80031,80018,66657,50025,70033700256001,4820097400580052005879009004431,5006002,6003,4003,4002,5505,2001,8001,9362,1002,1001,4823,7001,60092007800173,391194,000195,595 135,070343,600148,00559,66781,000121,00053,874100,000(21,000)5,0005,0005,0005,0005,000013,45325,00025,0003,37035,00010,00078,120111,000151,00062,244140,000(11,000)1,6113,0003,0001,211500(2,500)153000001,3771,5001,5002,4702,0005003,1414,5004,5003,6812,500(2,000)10,0006,0006,0004,5008,0002,00010,0006,0006,0004,5008,0002,00020,00014,00014,00010,50014,000018,10024,80024,80018,60046,70021,90038,10038,80038,80029,10060,70021,90000278,06200(278,062)00278,06200(278,062)302,753354,300673,957 234,595554,800(119,157)307,302255,000317,000237,455250,000(67,000)CITY OF LA QUINTA HOUSING AUTHORITYHOUSING AUTHORITY EXPENSESFY 2020/21 PROPOSED BUDGET* As of 4/27/202080 2018/19Actuals2019/20Original Budget2019/20Current Budget2019/20YTD Activity*2020/21Proposed Budget20/21 vs. Current 19/20% Change in Budget62 - Maintenance & Operations Totals:307,302255,000317,000 237,455250,000(67,000)-21 %9103 - Housing Authority - LQRP Totals:307,302255,000317,000 237,455250,000(67,000)-21 %241 - HOUSING AUTHORITY Totals:610,055609,300990,957 472,049804,800(186,157)-19 %307,302255,000317,000 237,455250,000(67,000)307,302255,000317,000 237,455250,000(67,000)610,055609,300990,957 472,049804,800(186,157)CITY OF LA QUINTA HOUSING AUTHORITYHOUSING AUTHORITY EXPENSESFY 2020/21 PROPOSED BUDGET* As of 4/27/2020241 HOUSING AUTHORITY FUND - These funds are used to account for the housing activities of the Housing Authority which are to promote and provide quality affordable housing.81 Fund: 241 - HOUSING AUTHORITYPermanent Full Time254,800.00241-9101-5010120% - City Manager (80% City Manager)10% - Finance Director (90% Finance)10% - City Clerk (90% City Clerk)40% - Assistant to City Manager (60% City Manager) 60% - Management Analyst (40% Information Technology Fund)60% - Management Specialist (40% City Manager)80% - Management Assistant (20% City Manager)In 2020/21, staff has been reallocated to meet businessdemands.City Council Member Stipends (5)Professional Services100,000.00241-9101-60103Expense increase in 2019/20 due to recent request for proposalresponses. Travel & Training500.00241-9101-60320Rental Expenses250,000.00241-9103-60157In FY 2016/17 these expenses were budgeted in accountnumber 241-9102-60159.CITY OF LA QUINTA HOUSING AUTHORITYHOUSING AUTHORITY EXPENSE NOTESFY 2020/21 PROPOSED BUDGET82 2018/19Actuals2019/20Original Budget2019/20Current Budget2019/20YTD Activity*2020/21Proposed Budget20/21 vs. Current 19/20% Change in Budget243 - RDA LOW-MOD HOUSING FUND0000 - Undesignated64 - Other Expenses166,666250,000351,000100,000250,000(101,000)-29 %243-0000-60532 Homelessness Assistance64 - Other Expenses Totals:166,666250,000351,000 100,000250,000(101,000)-29 %0000 - Undesignated Totals:166,666250,000351,000 100,000250,000(101,000)-29 %3 - RDA LOW-MOD HOUSING FUND Totals:166,666250,000351,000 100,000250,000(101,000)-29 %166,666250,000351,000100,000250,000(101,000)166,666250,000351,000 100,000250,000(101,000)166,666250,000351,000 100,000250,000(101,000)166,666250,000351,000 100,000250,000(101,000)243 Fund the 2020/21 former Redevelopment Agency loan repayment of $647,767 will be recognized in reserves within this Fund. CITY OF LA QUINTA HOUSING AUTHORITYHOUSING AUTHORITY EXPENSESFY 2020/21 PROPOSED BUDGET* As of 4/27/2020243 RDA Low-Mod Housing Fund - These funds are used to account for the housing activities of the Housing Authority which are to promote and provide quality affordable housing.83 2018/19Actuals2019/20Original Budget2019/20Current Budget2019/20YTD Activity*2020/21Proposed Budget20/21 vs. Current 19/20% Change in Budget248 - SA 2004 LO/MOD BOND FUND (Refin9102 - Housing Authority - Wash St Apts60 - Contract Services00145,00000(145,000)-100 %248-9102-60103 Professional Services954,4800245,5001,7390(245,500)-100 %248-9102-60159 Relocation Benefits80,735000000 %248-9102-60185 Design/Construction60 - Contract Services Totals:1,035,2150390,5001,7390(390,500)-100 %Housing Authority - Wash St Apts Totals:1,035,2150390,5001,7390(390,500)-100 % BOND FUND (Refinanced in 2014) Totals:1,035,2150390,5001,7390(390,500)-100 %00145,00000(145,000)954,4800245,5001,7390(245,500)80,735000001,035,2150390,5001,7390(390,500)1,035,2150390,5001,7390(390,500)1,035,2150390,5001,7390(390,500)248 Fund was fully used for the Washington Street Apartment rehabilitation and expansion project. CITY OF LA QUINTA HOUSING AUTHORITYHOUSING AUTHORITY EXPENSESFY 2020/21 PROPOSED BUDGET* As of 4/27/202084 2018/19Actuals2019/20Original Budget2019/20Current Budget2019/20YTD Activity*2020/21Proposed Budget20/21 vs. Current 19/20% Change in Budget249 - SA 2011 LOW/MOD BOND FUND (Re0000 - Undesignated60 - Contract Services7,376,024000000 %249-0000-60188 Construction60 - Contract Services Totals:7,376,024000000 %68 - Capital Expenses020,00060,000060,00000 %249-0000-80050 Affordable Housing Projec68 - Capital Expenses Totals:020,00060,000060,00000 %0000 - Undesignated Totals:7,376,02420,00060,000060,00000 %BOND FUND (Refinanced in 2016) Totals:7,376,02420,00060,000060,00000 %7,376,024000007,376,02400000020,00060,000060,0000020,00060,000060,00007,376,02420,00060,000060,00007,376,02420,00060,000060,0000249 Fund was partially used for the Washington Street Apartment rehabilitation and expansion project. Remaining funds are available for future housing projects. CITY OF LA QUINTA HOUSING AUTHORITYHOUSING AUTHORITY EXPENSESFY 2020/21 PROPOSED BUDGET* As of 4/27/2020249 SUCESSOR AGENCY BOND FUND - These funds are restricted per individual bond covenants. 85 86 POWER POINTS HOUSING AUTHORITY SPECIAL MEETING MAY 19, 2020 5/19/2020 18 Housing Authority Meeting May 19, 2020 Housing Authority Meeting May 19, 2020 B1 – Contract Services Agreement with La Quinta Palms Realty for Property Management Services 35 36 5/19/2020 19 Contract for Residential Property Management Services •February 2020 - RFP posted for property management services •Several firms contacted to submit proposals, La Quinta Palms Realty was selected •Provided property management services for Housing Authority for 16 years •Contract term July 1, 2020 - June 30, 2023; •Annual cost $42,000 for initial 3-year term / option of two 1-year extensions; total contract not-to-exceed $214,200 Questions and Comments for Staff? 37 38 5/19/2020 20 Housing Authority Meeting May 19, 2020 S1 – Discuss Fiscal Year 2020/21 Preliminary Proposed Budget 39 40 5/19/2020 21 FY 2020/21 Budget Schedule Jan. 11 – Community Workshop April 7 ‐ CIP – City Council May 5 – City Council May 6 – Housing Commission May 13 – Financial Commission May 19 – City Council/Housing June 2 – City Council June 3 – Financial Commission June 16 – City Council & Authority Budget Adoption Revenue Projections Fund 241 – No anticipated changes to rental income Fund 241 – Interest earnings may be reduced, currently at $250,000 Fund 243 – Includes annual loan repayment $647,767 Fund 249 ‐ Interest earnings may be reduced, currently at $350,000 Housing Fund Revenues 2019/20 Original 2019/20 Current Variance Original vs Current 2020/21 Proposed Variance Current vs. Proposed % Change - 241 - Housing Authority 448,000 1,688,256 1,240,256 563,300 (1,124,956)-67% 243 - RDA Low-Mod Housing 22,000 40,000 18,000 40,000 - 0% 249 - SA 2011 Low/Mod Bond 270,000 350,000 80,000 350,000 - 0% Total Revenues 740,000 2,078,256 1,338,256 953,300 (1,124,956) -54% RDA Loan Repayment 635,065 635,065 - 647,767 12,702 Total Operating Revenues 1,375,065 2,713,321 1,338,256 1,601,067 (1,112,254) 41 42 5/19/2020 22 Expense Projections Fund 241 – Professional services, legal fees, upgrades and repairs, insurances, information technology charges Fund 243 – Homelessness funding Fund 249 ‐ Evaluate future affordable housing projects Housing Fund Expenditures 2019/20 Original 2019/20 Current Variance Original vs Current 2020/21 Proposed Variance Current vs. Proposed % Change 241 - Housing Authority 609,300 990,957 381,657 804,800 (186,157) -19% 243 - RDA Low-Mod Housing 250,000 351,000 101,000 250,000 (101,000) -29% 249 - SA 2011 Low/Mod Bond 20,000 60,000 40,000 60,000 - 0% Total Expenditures 879,300 1,401,957 522,657 1,114,800 (287,157) -20% Where we stand today? FUND #FUND NAME TOTAL REVENUES TOTAL EXPENSES SURPLUS / (DEFICIT) 241 HOUSING AUTHORITY FUND 563,300 804,800 (241,500) 243* RDA LOW-MOD HOUSING FUND 687,767 250,000 437,767 249 SA 2011 LOW/MOD BOND 350,000 60,000 290,000 1,601,067 1,114,800 486,267 HOUSING AUTHORITY FUNDS SUMMARY OF REVENUES AND EXPENDITURES BY FUND FOR 2020/21 GRAND TOTAL * General Fund and RDA Low-Mod Housing Fund estimates are for unappropriated reserves and included annual Successor Agency loan repayments as approved with the last and final recognized obligation payment schedule. The repayment for FY 2020/21 is $647,767. 43 44 5/19/2020 23 Housing Fund Balances FUND #FUND NAME ESTIMATED AVAILABLE FUND BALANCE July 1, 2020 ESTIMATED REVENUES ESTIMATED EXPENDITURES ESTIMATED ENDING FUND BALANCE June 30, 2021 241 HOUSING AUTHORITY FUND 10,800,000 563,300 804,800 10,558,500 243* RDA LOW-MOD HOUSING FUND 2,600,000 687,767 250,000 3,037,767 249 SA 2011 LOW/MOD BOND 17,100,000 350,000 60,000 17,390,000 30,500,000 1,601,067 1,114,800 30,986,267 CITY OF LA QUINTA ESTIMATED ENDING FUND BALANCES FISCAL YEAR ENDING JUNE 30, 2021 GRAND TOTAL * General Fund and RDA Low-Mod Housing Fund estimates are for unappropriated reserves and included annual Successor Agency loan repayments as approved with the last and final recognized obligation payment schedule. The repayment for FY 2020/21 is $647,767. What’s next? •Second Update on 6/2/2020 (if needed) •Budget Adoption on 6/19/2020 45 46 5/19/2020 24 47