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04-018, Keyser Marston Associates ~-ol ~ AGREEMENT FOR THE PERFORMANCE OF SERVICES BY AND BETWEEN CITY OF CUPERTINO, CALIFORNIA AND KEYSER MARSTON ASSOCIATES, INC. This agreement for the performance of services ("Agreement") is made and entered into on this 21st day of Januarv, 2004 ("Effective Date"), by and between Keyser Marston Associates, Inc., a California Corporation, with its principal place of business located at 55 Pacific Avenue Mall. San Francisco. CA 94111 ("Contractor"), and the City of Cupertino, California, a general law municipal corporation, with its principal place of business located at 10300 Torre Avenue, Cupertino, California 95014 ("City"). City and Contractor may be referred to herein individually as a "Party" or collectively as the "Parties" or the "Parties to this Agreement." RECITALS Whereas: A. City desires to secure professional servIces more fully described m this Agreement; B. Contractor represents that it, and its sub-contractors, if any, have the professional qualifications, expertise, desire and any licensees) necessary to provide certain goods and/or required services of the quality and type which meet the City's requirements; and, C. The Parties have specified in this Agreement the terms and conditions under which such services will be provided and paid for. Contractor and City agree as follows: AGREEMENT PROVISIONS 1. SERVICES TO BE PROVIDED City employs Contractor to perform the services ("Services") more fully described in Exhibit A entitled, "SCOPE OF SERVICES." Exhibit A is attached and incorporated by this reference. Except as otherwise specified in this Agreement, Contractor shall furnish all necessary technical and professional services, including labor, material, equipment, transportation, supervision and expertise to satisfactorily complete the work required by City at his/her own risk and expense. 2. TERM OF AGREEMENT Unless this paragraph is subsequently modified by a written amendment to this Agreement, the term of this Agreement shall begin on the Effective Date and terminate at the end of day on September 30, 2001. a. Commencement of Services Contractor shall begin performing Services after receiving written notice from the City to proceed. b. Completion of Services Contractor shall complete Services within the time limits set forth in the Scope of Services or as mutually determined in writing by the Parties. When City determines that Contractor has satisfactorily completed the Services, City shall give Contractor written Notice of Completion, and Contractor shall not incur any further costs under this Agreement after receiving such notice. 3. COMPENSATION AND PAYMENT a. In consideration for Contractor's complete performance of Services, City shall pay Contractor for all materials provided and services rendered by Contractor at the rate per hour for labor and cost per unit for materials as outlined in Exhibit B, entitled "SCHEDULE OF FEES," attached and incorporated by this reference. b. Contractor will bill City on a monthly basis for Services provided by Contractor during the preceding month, subject to verification by City. City will pay Contractor within thirty (30) days of City's receipt of invoice. 4. NO ASSIGNMENT OF AGREEMENT City and Contractor bind themselves, their successors and assigns to all covenants of this Agreement. This Agreement shall not be assigned or transferred without the prior written approval of City. 5. NO THIRD PARTY BENEFICIARY This Agreement shall not be construed to be an agreement for the benefit of any third party or parties, and no third party or parties shall have any claim or right of action under this Agreement. 6. INDEPENDENT CONTRACTOR Contractor and all person(s) employed by or contracted with Contractor to furnish labor and! or materials under this Agreement are independent contractors and do not act as agent(s) or employee(s) of City. Contractor has full rights, however, to manage its employees in their performance of Services under this Agreement. Contractor is not authorized to bind City to any contracts or other obligations. 7. SUBCONTRACTING None of the Services under this Agreement shall be performed by subcontractors unless Contractor specifically identifies subcontractors in writing and City pre-approves such subcontractors in writing. Contractor shall be as fully responsible to City for the acts and omissions of its subcontractors, and of persons either directly or indirectly employed by them, as Contractor is for the acts and omissions of persons directly employed by it. 8. CONTRACTOR ASSIGNED PERSONNEL Contractor shall designate in writing an individual to have immediate responsibility for the Services under this Agreement. Key personnel to be assigned by Contractor shall be stipulated in the Scope of Services. Substitution of any assigned person shall require the written prior approval of the City, which shall not be unreasonably withheld. If the City determines that a proposed substitution is not responsible or qualified to perform the services then, at the request of the City, Contractor shall substitute a qualified and responsible person. 9. OWNERSHIP OF DOCUMENTS a. All work products, drawings, data, reports, files, estimates and other information and materials, with the exception of proprietary computer programs, accumulated by the Contractor to complete services under this Agreement shall be owned by the City. b. Contractor shall retain' custody of all project data and documents other than deliverables specified in the Scope of Services, but shall make access thereto available to the City at all reasonable times the City may request. City may make and retain copies for information and reference. . 10. RECORDS OF LABOR AND COSTS a. Contractor shall maintain for the Services, records of labor and costs used in claims for compensation under this Agreement. Records shall mean a contemporaneous record of time for personnel; a methodology and calculation of the Multiplier for fringe benefits and indirect costs; and invoices, time sheets, or other factors used as a basis for determining other nonlabor charges for Services. These records must be made available to the City upon reasonable notice of no more than 48 hours during the period of the performance of this Agreement. b. After delivery of Services (completion of Scope of Work) under this Agreement, the Contractor's records of all costs used in claim's for compensation under this Agreement shall be available to City's accountants and auditors for inspection and verification. These records will be maintained by Contractor and made reasonably accessible to the City for a period of three (3) years after completion of Scope of Work under this Agreement. c. Contractor agrees to cooperate and provide any and all information concerning the Project costs which are a factor in determining compensation under this Agreement as requested by the City or any public agency which has any part in providing financing for, or authority over, the Services which are provided under the Agreement. d. Failure to provide documentation or substantiation of all costs for Services used as a factor in compensation paid under Provision 3 hereof will be grounds for City to refuse payment of any statement submitted by the Contractor and for a back charge for any City funds, including interest from payment; or grant, matching or other funds from agencies assisting City in financing the Services specified in this Agreement. 11. NONDISCLOSURE OF PROPRIETARY INFORMATION Contractor shall consider all information provided by City and all drawings, reports, studies and other documents resulting from the Contractor's performance of the Services to be proprietary unless such information is available from public sources. Contractor shall not publish or disclose proprietary information for any purpose other than the performance of the Services without the prior Written authorization of City or in response to legal process. 12. USE OF CITY NAME OR EMBLEM Contractor shall not use City's name, insignia, or emblem, or distribute any information related to services under this Agreement in any magazine, trade paper, newspaper or other medium without express written consent of City. 13. AUDITS City, through its authorized representatives, has the right during the term of this Agreement, and for three (3) years from the date of final payment for goods and/or Services provided under this Agreement, to audit the books and records of Contractor regarding matters covered by this Agreement. Contractor agrees to maintain accurate books and records in accordance with generally accepted accounting principles. Any expenses not so recorded shall be disallowed by City. Contractor agrees to help City meet any reporting requirements with respect to Contractor's Services if requested by City in writing. 14. QUALIFICATIONS OF CONTRACTOR Contractor represents that its personnel are qualified to furnish Services of the type and quality, which City requires. City expressly relies on Contractor's representations regarding its skills and knowledge. Contractor shall promptly perform all Services requested by City in a safe manner and in accordance with all federal, state, and local operation and safety regulations. Contractor shall work closely with and be guided by City. Contractor shall also perform all work in accordance with generally accepted business practices and performance standards of the industry. 15. MONITORING OF SERVICES City may monitor the Services performed under this Agreement to determine whether Contractor's operation conforms to City policy and to the terms of this Agreement. City may also monitor the Services to be performed to determine whether financial operations are conducted in accord with applicable City, county, state, and federal requirements. If any action of Contractor constitutes a breach, City may terminate this Agreement pursuant to the provisions described herein. 16. WARRANTY Contractor expressly warrants that all materials and services covered by this Agreement shall be fit for the purpose intended, shall be free from defect, and shall conform to the specifications, requirements, and instructions upon which this Agreement is based. Contractor agrees to promptly replace or correct any incomplete, inaccurate, or defective Services at no further cost to City when defects are due to the negligence, errors or omissions of Contractor. If Contractor fails to promptly correct or replace materials or services, City may make corrections or replace materials or services and charge Contractor for the cost incurred by City. 17. FAIR EMPLOYMENT Contractor shall not discriminate against any employee or applicant for employment because of race, color, creed, national origin, sex, age, condition of physical handicap, religion, ethnic background, or marital status, in violation of state or federal law. 18. CONTRACTOR TO HOLD CITY HARMLESS To the extent permitted by law, Contractor agrees to indemnify, protect, defend, and hold harmless City, its City Council, officers, employees, volunteers and agents from and against any claim, injury, liability, loss, cost, and/or expense or damage, including all costs and reasonable attorney's fees in providing a defense to any claim, arising from Contractor's negligent, reckless or wrongful acts, errors, or omissions with respect to or in any way connected with the performance of the Services by Contractor, its agents, subcontractors and/or assigns under this Agreement. 19. INSURANCE REQUIREMENTS During the term of this Agreement, and for any time period set forth in Exhibit C, Contractor shall purchase and maintain in full force and effect, at no cost to City insurance policies with respect to employees and vehicles assigned to the Performance of' Services under this Agreement with coverage amounts, required endorsements, certificates of insurance, and coverage verifications as defined in Exhibit C attached and incorporated by this reference. 20. AMENDMENTS This Agreement may be amended only with the written consent of both Parties. 21. INTEGRATED DOCUMENT This Agreement represents the entire agreement between City and Contractor. No other understanding, agreements, conversations, or otherwise, with any representative of City prior to execution of this Agreement shall affect or modify any of the terms or obligations of this Agreement. Any verbal agreement shall be considered unofficial information and is not binding upon City. 22. SEVERABILITY CLAUSE In case anyone or more of the provisions in this Agreement shall, for any reason, be held invalid, illegal or unenforceable in any respect, it shall not affect the validity of the other provisions, which shall remain in full force and effect. 23. LAW GOVERNING CONTRACT This Agreement shall be governed and interpreted usmg the laws of the State of California. 24. DISPUTE RESOLUTION a. Any controversies or claims between Contractor and City regarding this Agreement must first be put in writing and delivered to the other Party. The Parties will meet in good faith to attempt to resolve the issue in question. If the Parties fail to come to an agreement on the resolution of the issue, all required administrative procedures must be followed. If all administrative procedures are exhausted and the Parties are unable to resolve the issue, the matter must be submitted to mediation within thirty (30) calendar days after the written request for mediation is delivered by one Party. b. The Parties may agree on one mediator. If they cannot agree on one mediator, the Party demanding mediation shall request that the Superior Court of Santa Clara County appoint a mediator. The mediation meeting shall not exceed one work day [eight (8) hours]. The Parties may agree to extend the time allowed for mediation under this Agreement. C. Mediation under this section is a condition precedent to filing an action in any court. In the event litigation or mediation arises out of any dispute related to this Agreement, the Parties shall each pay their respective attorneys' fees, expert witness costs and cost of suit, regardless of the outcome of the litigation. d. Only after both the administrative dispute resolution procedure and the mediation procedure have failed to resolve a dispute between the Parties may one or both of the Parties file suit in the appropriate civil court. 25. VENUE The venue of any suit filed by either Party shall be vested in the state courts of the County of Santa Clara, or if appropriate, in the United States District Court, Northern District of California, San Jose, California. 26. ELECTION OF REMEDIES The pursuit by any Party of any specific remedy shall not exclude any other remedy available to the Party. 27. CONFLICT OF INTERESTS This Agreement does not prevent either Party from entering into similar agreements with other parties. To prevent a conflict of interest, Contractor certifies that to the best of its knowledge, no City officer, employee or authorized representative has any financial interest in the business of Contractor and that no person associated with Contractor has any interest, direct or indirect, which could conflict with the faithful performance of this Agreement. Contractor is familiar with the provisions of California Government Code Section 87100 and following, and certifies that it does not know of any facts which would violate these code provisions. Contractor will advise City if a conflict arises. 28. TERMINATION OF THE AGREEMENT a. Termination Without Cause Either Party may terminate this Agreement without cause by giving the other Party written notice ("Notice of Termination") which clearly expresses that Party's intent to terminate the Agreement. Notice of Termination shall become effective no less than thirty (30) calendar days after a Party receives such notice. After either Party terminates the Agreement, Contractor shall discontinue further services as of the effective date of termination, and City shall pay Contractor for all Services satisfactorily performed up to such date. b. Termination For Cause F or purposes of this Agreement, the term "default" shall mean the failure of any Party to perform any material obligation in the time and manner provided by this Agreement. Either Party may terminate this Agreement in the event of a default by the other Party by providing a written Notice of Termination to the defaulting Party. Such Notice of Termination shall become effective no less than ten (10) calendar days after a Party receives such notice. Such Notice of Termination for cause shall include a statement by the terminating Party setting forth grounds for determination of default under the Agreement. In the event this Agreement is terminated for cause as set forth under this section, City shall pay Contractor for all Services satisfactorily performed up to the date the Agreement is terminated. City may deduct from such payment the amount of actual damage, if any, sustained by City due to Contractor's failure to perform the Services or for breach of this Agreement. c. Opportunity to Cure Default Upon receipt of a Notice of Termination by a Party arising from its default under this Agreement, the defaulting Party shall have five (5) days from the receipt of such notice to cure the default by making such payment or performing the required obligation. If the default is cured to the mutual satisfaction of the Parties, the Agreement shall remain in effect upon written acceptance of the cure by the Party who issued the Notice of Termination for cause. 29. NOTICES All notices to the Parties shall, unless otherwise requested in writing, be sent to City addressed as follows: City of Cupertino Community Development Department Attn: Vera Gil 10300 Torre Avenue Cupertino, CA 95014 or by facsimile at (408) 777-3333 And to Contract address as follows: Keyser Marston Associates, Inc. 55 Pacific Avenue Mall San Francisco, CA 94111 Phone: (415) 398-3050 Facsimile: (415) 397-5065 30. COMPLIANCE WITH ETHICAL STANDARDS Contractor shall: a. Read Exhibit D, entitled "ETHICAL STANDARDS FOR CONTRACTORS SEEKING TO ENTER INTO AN AGREEMENT WITH THE CITY OF CUPERTINO, CALIFORNIA," attached and incorporated by this reference; and, b. Execute Exhibit E, entitled "AFFIDAVIT OF COMPLIANCE WITH ETHICAL STANDARDS" attached and incorporated by this reference. The Parties acknowledge and accept the terms and conditions of this Agreement as evidenced by the following signatures of their duly and authorized representatives. It is the intent of the Parties that this Agreement shall become operative on the Effective Date. III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III CITY OF CUPERTINO, CALIFORNIA a General Law Calirornia municipal corporation Charles Kilian City Attorney BY:~f David W. Knapp City Manager 2 . ?(, . Ot.{ ArrEST: ~~ Kimberly ~ City Clerk 10300 Torre Avenue Cupertino, California 95014 Telephone: (408) 777-3200 Facsimile: (408) 777-3333 "City" Keyser Marston Associates, Inc. a California Corporation By: Kate Ea Ie Funk Princi 55 Pacific Avenue Mall, S Francisco, CA 94111 Telephone: (415) 398-3050 Facsimile: (415) 397-5065 "Contractor" AGREEMENT FOR THE PERFORMANCE OF SERVICES BY AND BETWEEN CITY OF CUPERTINO, CALIFORNIA AND KEYSER MARSTON ASSOCIATES, INC. EXHIBIT A SCOPE OF SERVICES The Services to be performed for the City by the Contractor under this Agreement are more fully described in the Contractor's proposal entitled Scope of Services, consisting of.2 pages, which is attached to this Exhibit A and incorporated by this reference. Scope of Services Page 1 of 1 Exhibit A EXHIBIT A SCOPE OF SERVICES PART I - HOUSING MITIGATION IN-LIEU FEE NEXUS STUDY UPDATE Overview and "Kick-off' Meeting The following scope describes the major analysis tasks for the preparation of a revised nexus analysis report to meet the requirements of AB 1600 and additional tasks to assist policy makers in updating and possibly expanding the nexus program in Cupertino. The scope has been structured to analyze a range of options, with the understanding that staff and policy makers may wish to reduce the options before determining the final program. Specifically, the following assumptions will be addressed in the analysis: · Building types or land uses subject to a nexus fee . Office/High Tech/R&D . Retail/Entertainment . Hotel/Lodging · Income Levels . Very low income (under 50% median) . Low income (50% to 80% median) . Median income (80% to 100% median) . Moderate income (100% to 120% median) · Housing Products (for determining affordability gaps) . Rental apartments for very low and low income categories . Condominium units for median and/or moderate income category The scope follows the outline and content of the report At the "kick-off' work session with staff, we will go over these assumptions on scope and make any adjustments and refinements. Additionally, we will provide you, in advance, a list of data and input needs that we can go over and discuss. 99900\900b-314.doc Task A - The Housing Nexus Concept and Housing Programs in Cupertino The first section of the Economic Nexus Analysis report will be a narrative laying out the nexus concept and its application to commercial construction in Cupertino. The major subsections cover: 1. The Legal Basis and Context and the Nexus Concept - Issues, fundamental assumptions and major variables at the local level. What is counted and not counted in the analysis. 2. The Cupertino Affordable Housing Context - A summary of other Cupertino housing initiatives and policies, and how a nexus fee relates to the affordable housing program overall, based on materials provided by the City. (This subtask is optional for update purposes and has been excluded from the budget.) Task B - Micro Economic Analysis of the Jobs Housing Nexus This section produces the numerical nexus analysis that meets the requirements of AB 1600 to demonstrate the quantitative relationships between the construction of the building types under study and the mitigation required (building affordable units or paying the in-lieu fee.) KMA has developed a proprietary computerized model to perform the analysis in a highly efficient manner. Data is drawn from on-line governmental sources that provide cross matrices of occupations into building types, and local, recent compensation data from the state Employment Development Department. For ease of analysis and understanding, we conduct the analysis on prototype buildings of, say, 100,000 square feet. At the conclusion of the analysis, the findings are divided by the building size to express the linkage in fractions of housing units. The analysis will contain the following steps or subtasks (not necessarily in order): 1. Category or Building Type Definition - Working with staff at the first meeting, it will be useful to discuss the types of projects to be subject to the fee program. 2. Translation to Number of Employees - The findings on employment density and trends from the macro analysis will be utilized in this section estimate the number of employees associated with the prototype building. 3. Adjustment for Commuting to Outside the City - Based on the findings of the macro analysis, the share of employees likely to seek housing outside of the City will be an analysis adjustment. Since the propensity to commute is already influenced by the inadequate supply of affordable housing in Cupertino, existing commuting percentages could warrant some further adjustment. 99900\900b-314.doc 4. Adjustments for Workers Per Household and Changes in Labor Force Participation - Using U.S. Census and other government data sources, the number of employees will be adjusted to the number of households. We will also adjust for changes in labor force participation. 5. Allocation of Employee Households to Income Categories - The nexus model than takes the employees into an allocation by occupation and from occupation to income level using local wage and salary inputs, to household income. 6. Conclusions on the Number of Households at Each Income Category - The conclusions are first expressed for the total prototype building and then converted to the per square foot level. The analysis produces findings on the number of housing units for each income classification. Task C - Affordability Gap and Justified Fee levels This task has some overlap with tasks in the BMR Update Program although for nexus purposes, we would be using only one selected housing prototype for rental units and one for ownership units. We would work with City staff on selecting appropriate prototypes and affordability gap figures. This task provides the dollar link between the nexus findings (end of Task C) and the cost of mitigation. The major subtasks of the analysis are: 1. Summarize the affordable rents and ownership unit prices for the various affordability level (BMR update work). 2. Update the cost of developing apartment and townhouse/condominium products, on average in Cupertino. 3. Determine the average affordability gap for each income affordability classification. For sale units will be linked to median and/or moderate income and rental units to the lower income classifications. 4. The affordability gap for each income level is applied to the number of units per square foot of building area. The result is total nexus cost, or the highest fee level supported by the analysis. The fee that the City elects to charge may be any amount lower than the dollar nexus. 99900\900b-314.doc Task D - Tasks to Assist in Identifying a Fee Program for Cupertino The tasks in this section are offered to provide guidance to policy makers in Cupertino in updating the fee program. This task group particularly addresses the question of a fee on retail and hotel type projects. This task also addresses raising the fee on office/high tech. 1. Fee Impact Analysis - This task is an assessment of the economic impact of a nexus fee (or alternative fee levels) on construction activity. One approach is to examine fee levels against total development costs and land costs. The subtasks of the impact assessment are: a. Evaluate overall market conditions for the three building types, particularly focusing on retail. Inspect existing retail concentrations and assess the competitive environment in Cupertino and vis-a-vis neighboring cities. Discuss issues and perceptions with City staff. b. Summarize development costs for office and high tech building types and assemble information for retail/entertainment and hotel/lodging projects. Total development costs include construction, tenant improvements, indirect costs and land. Other significant fees, such as traffic mitigation fees, will be summarized. c. Evaluate alternative fee levels against total development costs. Test the relationship of fees at different levels against the total costs. Evaluate potential fee levels in the context of other impact fees in Cupertino. d. Identify the required adjustment in rental income to recapture the fee cost (recognizing that rental increases may not be possible); or adjustment in land value to compensate for the fee, or other measure. 2. Review housing nexus fees in other jurisdictions, particularly those in the other Silicon Valley cities and where similar market conditions are present. 3. Advise the City with respect to other fee program issues such as minimum size thresholds for fee application, exempted uses, exempted areas (such as redevelopment areas), timing of collection of fees, etc. to meet objectives and concerns about specific type projects. 4. Recommend an appropriate fee range for each of the three building types. Task E - Report Preparation A work session with staff is suggested following the completion of the analysis. Table sets summarizing the analysis will be presented to staff and other groups as requested. Once the 99900\900b-314.doc tables, analyses, and presefltation recommendations are agreed upon, we will prepare the report document. The nexus report will be presented in a manner to meet the needs of AB 1600 and relevant sections of the Government Code 66000 et. seq. Task F - Focus Group Meeting Per the RFP, we would be pleased to host a focus group meeting with affected developers and other industry representatives. For new programs we regularly recommend such meetings to explain the program and concept and solicit input on local market issues that the fee program design might take into consideration. Since several Silicon Valley cities have commercial fees, it will be of interest to ascertain the extent to which development decisions are in any way affected by these fees vis-a-vis other factors. PART II - BMR UPDATE PROGRAM Task A - Affordability levels and BMR Pricing In this task we will review your current formulas and practices in establishing BMR rent levels and for sale unit pricing. We will evaluate your formulas in comparison to our own independent calculations of affordable rents and units for various income levels and size households matched to units, done a manner widely used elsewhere. We will evaluate issues of consistency and impacts to various affected parties. Task B - Survey of BMR Rental Rates and Pricing Per the request, we will obtain information on how other jurisdictions in the Silicon Valley area establish BMR rent levels and sales prices for comparable affordability levels and household/unit sizes. We will seek to obtain code language and other documentation as well as deed restriction differences on a generalized level. (See Task F for a more in depth investigation of this subject.) To the extent that BMR pricing does differ from one city to another, we will advise Cupertino on impacts and recommend changes, if appropriate. Task C - Focus Group Meeting We would be pleased to host focus group meeting(s) with interested developers to discuss pricing formulas and practices. The topic of this meeting could be broadened to cover other aspects of the existing BMR program and how it might be modified as part of this update process. We should be clear that the basic program requirements are not subject to reevaluation but that minor provisions and practices could be adjusted as part of the update process and legislative package. We have in mind various "offsets" or "incentives" that the City mayor could offer, fractional unit practices and other like details. Task 0 - RecommendationslTechnical Memorandum 99900\900b-314.doc We believe the analysis, findings and recommendations of Tasks A, B, and C of the update program will be suitable material for a technical memorandum. The memorandum will recommend, if appropriate, adjustments to the current BMR rental rate and sale price formulas, with new schedules or rental rates and sales prices by affordability level and household/unit size. We will initially present our findings and recommendations to staff and following any staff input, draft the final memorandum. The memorandum will be suitable for attachment to the staff report going to commissions and Council. Electronic versions of formula and schedules will be transmitted. (Alternatively, we could produce a more formal report which would cost a little more) Task E - Deed Restrictions Review KMA has worked on developing improved deed restrictions in a number of communities, primarily to improve buyer financing. There has been movement on the part of lending institutions regarding the priority position of affordability covenants vis-a-vis the lender's first deed of trust. KMA will review the current deed restrictions and will collaborate with the City's legal counsel regarding alternative strategies for replacing current deed restrictions as relates to new projects, and possibly negotiating revisions in the restrictions with existing BMR unit owners. Product: Technical memorandum on the financing issue. The format of the final documentation will be determined in collaboration with City staff. Task F -In-Lieu Formula Revisions As part of this BMR update program, the City may wish to reexamine in-lieu fees amounts. The reexamination could be limited to an update to reflect the spread between current development costs/market values of new rental and ownership units and affordable units. If BMR rent levels and unit prices are adjusted (as a result of the reevaluation of BMR pricing and rent setting per BMR Task A), then recalculation of the in-lieu amount might be appropriate in any case. This task would require a survey of recent residential construction to ascertain market pricing by unit size, type of unit and possibly geographic area within the City. For rental projects, we would survey recently constructed rental properties and ascertain market rent levels by unit size. To convert rental income to unit value for purposes of the affordability gap and in-lieu amounts, we would research current operating expense experience as well. An expanded version of this task could include reexamination of the application of in-lieu fees to smaller projects, including single detached units, and other variations that would enhance fee revenue potential. Product: Technical Memorandum which summarizes the research and analysis. 99900\900b-314.doc PART III - MEETINGS AND PRESENTATIONS A Keyser Marston Associates Principal will participate in each of two focus meetings to be held with developers and other stakeholders. It is anticipated that one meeting will be with residential developers, property owners, and stakeholders and one meeting with commercial developers, etc. The City will host the meetings and be responsible for inviting appropriate attendees. A Keyser Marston Associates Principal will attend up to six public meetings, which could be the Housing Commission, Planning Commission, City Councilor possibly a joint session of more than one group. Consultant will be available to make presentations at such meetings. 99900\900b-314. doc BUDGET ESTIMATE NEXUS STUDY AND BMR UPDATE CUPERTINO, CA KMA Hours Maureen Kate Debbie Nagle KMA Funk Kern Senior Budget Principal Principal Associate Associate Admin. Totals Billing Rate $205 $205 $150 $130 $63 I Commercial Nexus Fee A. Housing Nexus Concept and Housing Programs/Project Initiation 15 0 0 5 $3,388 B. Micro Economic Analysis of the Jobs Housing Nexus 15 0 10 30 5 $8,788 C. Affordability Gap and Justified Fee Levels 0 0 20 5 5 $3,963 D. Tasks to Assist in Identifying a Fee Program 10 0 30 5 $6,863 E. Report Preparation 15 0 15 0 20 $6,575 F. Focus Group Meeting (see below) 0 $0 Subtotal 55 0 75 35 40 $29,575 II BMR Program Services A. Affordability Levels and BMR Pricing 0 15 10 0 0 $4,575 B. Survey of BMR Rental Rates and Pricing 0 5 20 0 0 $4,025 C. Focus Group Meeting (see below) 0 10 0 0 0 $2,050 D. RecommendationslT echnical Memorandum 8 15 0 0 5 $5,028 Subtotal 8 45 30 0 5 $15,678 Other BMR Services. E. Deed Restrictions Review 0 12 0 0 1 $2,523 F. In-lieu Formula Revisions 20 8 30 0 1 $10,303 Subtotal 20 20 30 0 2 $12,825 III Meetings and Presentations Focus Group Meetings (2) 8 8 0 0 0 $3,280 Presentations to Commission and Council (6) 18 18 0 0 0 $7,380 PowerPoint Preparation. 4 0 0 0 8 $1 ,320 Subtotal 30 26 0 0 8 $11,980 Expenses (KMA & AA) Task I (Travel and report reprod.) $250 Task II (Travel & related) $250 Task III (Travel & related) $500 Subtotal $1,000 Contingency 1,471 Total $72,529 PE~;Wr8R)!if<m@~rston Associates, Inc. Filename:' !l~/9!lgtJ'6/budget cupertino.xlsBudget; 2/3/2004 4:24 PM mc AGREEMENT FOR THE PERFORMANCE OF SERVICES BY AND BETWEEN CITY OF CUPERTINO, CALIFORNIA AND KEYSER MARSTON ASSOCIATES, INC. EXHIBIT B SCHEDULE OF FEES In no event shall the amount billed to City by Contractor for Services performed under this Agreement exceed Seventy Two Thousand Five Hundred Twenty Nine Dollars and No Cents ($72,529.00) dollars, subject to budget appropriations. Compensation for consulting services performed under this Agreement shall be compensated for on a time and materials basis, in accordance with the following fee schedule: A. JERRY KEYSER * $225.00 MANAGING PRINCIPALS* $220.00 PRINCIPALS * $205.00 MANAGERS * $165.00 SENIOR ASSOCIATES $150.00 ASSOCIATES $130.00 SENIOR ANAL YSTS $115.00 ANALYSTS $100.00 TECHNICAL STAFF $ 78.00 ADMINISTRATIVE STAFF $ 62.50 Directly related job expenses not included in the above rates are: auto mileage, air fares, hotels and motels, meals, car rentals, taxies, telephone calls, delivery, electronic data processing, graphics and printing. Directly related job expenses will be billed at 110% of cost. Monthly billings for staff time and expenses incurred during the period will be payable within thirty (30) days of invoice date. A charge of 1 % per month will be added to all past due accounts. * Rates for individuals in these categories will be increased by 50% for time spent in court testimony. Schedule of Fees Page 1 of 1 Exhibit B AGREEMENT FOR THE PERFORMANCE OF SERVICES BY AND BETWEEN CITY OF CUPERTINO, CALIFORNIA AND KEYSER MARSTON ASSOCIATES, INC. EXHIBIT C INSURANCE REQUIREMENTS Contractor shall provide and maintain at all times during the performance of the Agreement the following insurances: 1. Workers' Comuensation and Emulover's Liability Insurance for protection of Contracor's employees as required by law and as will protect Contractor from loss or damage because of personal injuries, including death, to any of his employees. 2. Comurehensive Automobile Liability Insurance. Contractor agrees to carry a Comprehensive Automobile Liability Policy providing bodily injury liability. This policy shall protect Contractor against all liability arising out of the use of owned or leased automobiles both passenger and commercial. Automobiles, trucks, and other vehicles and equipment (owned, not owned, or hired, licensed or unlicensed for road use) shall be covered under this policy. Limits of liability for Comprehensive Automobile Liability Insurance shall not be less than $1,000,000 Combined Single Limit. 3. Comurehensive General Liability. Insurance as will protect Contractor and City from any and all claims for damages or personal injuries, including death, which may be suffered by persons, or for damages to or destruction to the property of others, which may arise from the Contractor's operations under this Agreement, which insurance shall name the City as additional insured. Said insurance shall provide a minimum of $1 ,000,000 Combined Single Limit coverage for personal injury, bodily injury, and property damage for each occurrence arid aggregate. Such insurance will insure Contractor and City from any and all claims arising from the following: 1. Personal injury; 2. Bodily injury; 3. Property damage; 4. Broad form property damage; 5. Independent contractors; 6. Blanket contractual liability. 4. Contractor shall maintain a policy of professional liability insurance, protecting it against claims arising out of negligent acts, errors, or omissions of Contractor pursuant to this Agreement, in an amount of not less than $1,000,000. The said policy shall cover the indemnity provisions under this Agreement. Standard Insurance Requirements Page 1 of3 Exhibit C 5. Contractor agrees to maintain such insurance at Contractor's expense in full force and effect in a company or companies satisfactory to the City. All coverage shall remain in effect until completion of the Project. 6. Contractor will furnish the City with certificates of insurance issued by Contractor's insurance carrier and countersigned by an authorized agent or representative of the insurance company. The certificates shall show that the insurance will not be cancelled, altered, or reduced without at least thirty (30) days prior written notice to the City. The certificates for liability insurance will show that liability assumed under this Agreement is included. LIABILITY AND INDEMNIFICATION 7. Having considered the risks and potential liabilities that may exist during the performance of the Services; and in consideration of the promises included herein, City and Contractor agree to allocate such liabilities in accordance with this Exhibit. Words and phrases used in this Exhibit shall be interpreted in accordance with customary insurance industry usage and practice. 8. Contractor shall indemnify and save harmless and defend the City and all of their agents, officers, and employees from and against all claims, demand, or cause of action of every name and nature arising out of negligent error, omission, or act of Contractor, its agents, servants, or employees in the performance of its services under this Agreement. 9. In the event an action for damages is filed in which negligence is alleged on the part of City and Contractor, Contractor agrees to defend City. In the event City accepts Contractor's defense, City agrees to indemnify and reimburse Contractor on a pro rata basis for all expenses of defense and any judgment or amount paid by Contractor in resolution of such claim. Such pro rata share shall be based upon a final judicial determination of negligence or, in the absence of such determination, by mutual agreement. 10. Contractor shall indemnify City against legal liability for damages arising out of claims by Contractor's employees. .City shall indemnify Contractor against legal liability for damages arising out of claims by City's employees. 11. Indemnity provisions will be incorporated into all contractual arrangements entered into by City for these Services and will protect City and Contractor to the same extent. 12. Upon completion of all services, obligations and duties provided for in the Agreement, or in the event of termination of this Agreement for any reason, the terms and conditions of this ExhIbit shall survive. Standard Insurance Requirements Page 2 of3 Exhibit C 13. To the maximum extent permitted by law, Contractor's liability for City's damage will not exceed the aggregate compensation received by Contractor under this Agreement or the maximum amount of professional liability insurance required by this Agreement, which ever is greater. III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III III Standard Insurance Requirements Page 3 of3 Exhibit C AGREEMENT FOR THE PERFORMANCE OF SERVICES BY AND BETWEEN CITY OF CUPERTINO, CALIFORNIA AND KEYSER MARSTON ASSOCIATES, INC. EXHIBIT D ETHICAL STANDARDS FOR CONTRACTORS SEEKING TO ENTER INTO AN A GREEMENT WITH THE CUPERTINO, CALIFORNIA Termination of Agreement for Certain Acts A. The City may, at its sole discretion, terminate this Agreement in the event anyone or more of the following occurs: 1. If a Contractor1 does any of the following: a. Is convicted2 of operating a business in violation of any Federal, State or local law or regulation; b. Is convicted of a crime punishable as a felony involving dishonesty3 ; c. Is convicted of an offense involving dishonesty or is convicted of fraud or a criminal offense in connection with: (1) obtaining; (2) attempting to obtain; or, (3) performing a public contract or subcontract; d. Is convicted of any offense which indicates a lack of business integrity or business honesty which seriously and directly affects the present responsibility of a City contractor or subcontractor; and/or, For purposes of this Agreement, the word "Contractor" (whether a person or a legal entity) means any of the following: an owner or co-owner of a sole proprietorship; a person who controls or who has the power to control a business entity; a general partner of a partnership; a principal in a joint venture; or a primary corporate stockholder [i.e., a person who owns more than ten percent (10%) of the outstanding stock ofa corporation] and who is active in the day to day operations of that corporation. For purposes of this Agreement, the words "convicted" or "conviction" mean a judgment or conviction of a criminal offense by any court of competent jurisdiction, whether entered upon a verdict or a plea, and includes a conviction entered upon a plea of nolo contendere within the past five (5) years. As used herein, "dishonesty" includes, but is not limited to, embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, failure to pay tax obligations, receiving stolen property, collusion or conspiracy. Ethical Standards for Contractors Page 1 of2 Exhibit D e. Made (or makes) any false statement(s) or representation(s) with respect to this Agreement. 2. If fraudulent, criminal or other seriously improper conduct of any officer, director, shareholder, partner, employee or other individual associated with the Contractor can be imputed to the Contractor when the conduct occurred in connection with the individual's performance of duties for or on behalf of the Contractor, with the Contractor's knowledge, approval or acquiescence, the Contractor's acceptance of the benefits derived from the conduct shall be evidence of such knowledge, approval or acquiescence. B. The City may also terminate this Agreement in the event anyone or more of the following occurs: 1. The City determines that Contractor no longer has the financial capability4 or business experience5 to perform the terms of, or operate under, this Agreement; or, 2. If City determines that the Contractor fails to submit information, or submits false information, which is required to perform or be awarded a contract with City, including, but not limited to, Contractor's failure to maintain a required State issued license, failure to obtain a City business license (if applicable) or failure to purchase and maintain bonds and/or insurance policies required under this Agreement. C. In the event a prospective Contractor (or bidder) is ruled ineligible (debarred) to participate in a contract award process or a contract is terminated pursuant to these provisions, Contractor may appeal the City's action to the City Council by filing a written request with the City Clerk within ten (10) days of the notice given by City to have the matter heard. The matter will be heard within thirty (30) days of the filing of the appeal request with the City Clerk. The Contractor will have the burden of proof on the appeal. The Contractor shall have the opportunity to present evidence, both oral and documentary, and argument. Contractor becomes insolvent, transfers assets in fraud of creditors, makes an assignment for the benefit of creditors, files a petition under any section or chapter of the federal Bankruptcy Code (1 I U.S.c.), as amended, or under any similar law or statute of the United States or any state thereof, is adjudged bankrupt or insolvent in proceedings under such laws, or a receiver or trustee is appointed for all or substantially all of the assets of Contractor. Loss of personnel deemed essential by the City for the successful performance of the obligations of the Contractor to the City. Ethical Standards for Contractors Page 2 of2 Exhibit D AGREEMENT FOR THE PERFORMANCE OF SERVICES BY AND BETWEEN CITY OF CUPERTINO, CALIFORNIA AND KEYSER MARSTON ASSOCIATES, INC. EXHIBIT E AFFIDAVIT OF COMPLIANCE WITH ETHICAL STANDARDS [CITY OF CUPERTINO] I, Kate Earle Funk, being first duly sworn, depose and say that I am a Principal of Kevser Marston Associates. Inc. and I hereby state that I have read and understand the language, entitled "ETHICAL STANDARDS FOR CONTRACTORS SEEKING TO ENTER INTO AN AGREEMENT WITH THE CITY OF CUPERTINO, CALIFORNIA" (herein "Ethical Standards") set forth in Exhibit D. I have authority to make these representations on my own behalf or on behalf of the legal entity identified herein. I have examined appropriate business records and I have made inquiry of those individuals potentially included within the definition of "Contractor" contained in the Ethical Standards. Based on my review of the appropriate documents and the necessary inquiry responses, I hereby state that neither the business entity nor any individual(s) belonging to a category identified in footnote #1 of Exhibit D [i.e., owner or co-owner of a sole proprietorship, general partner, person who controls or has power to control a business entity, etc.] has been convicted of anyone or more of the crimes identified in Exhibit D within the past five (5) years. The above assertions are true and correct and are made under penalty of perjury under the laws of the State of California. ERVICES SILICON VALLEY NOTARY'S ACKNOWLEDGMENT TO BE ATTACHED Please execute the affidavit and attach a notary public's acknowledgment of execution of the affidavit by the signatory. If the affidavit is on behalf of a corporation, partnership, or other legal entity, the entity's complete legal name and the title of the person signing on behalf of the legal entity shall appear above. Written evidence of the authority of the person executing this affidavit on behalf of a corporation, partnership, joint venture, or any other legal entity, other than a sole proprietorship, shall be attached. Affidavit of Compliance With Ethical Standards Exhibit E Page I of 1 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT STATE OF CALIFORNIA ) COUNTY OF :3 A A/ -F;1{Jt1 j.J cO: SCO ) OnF~CVfA-f '4J ~ '1 DATE before me~A.?'t<; R'. ~n>~ J/P-rJf JJ-y' fJC4~L,",'~ NAME, TITLE OF OFFICER - E.G.., "JANE DOE, NOTARY PUBLIC" 4,JL /L.-,AR.L!t- Fuf.J e: personally appeared, personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by hislher/their signature( s) on the instrument the person( s), or the entity upon behalf of which the person( s) acted, executed the instrument. WITNESS my hand and official seal. ~ ~4-- NOTAR Y PUBLIC SIGNATURE (SEAL) y.------------ o CURTIS K. KASPER ~ COMM. # 141lB93 ~ f . NOTARY PU.BUC-CAUFORN/A" L SAN FRANCISCO COUNTY 0 . ~ ~ - ~ ~O:'~. ~p ...JU~E 21.~2~ OPTIONAL INFORMATION THIS OPTIONAL INFORMATION SECTION IS NOT REQUlRED BY LAW BUT MAY BE BENEFICIAL TO PERSONS RELYING ON TInS NOT ARlZE.D DOCUMENT. . A ~A OA u,-r o?-- Ct,A.I1~-.~~ U/,"rct lkC:rftb~~ TITLE OR TYPE OF DOCUMENT ~r;y"u;)f4i)S C~'::(y lJ iF t:A..P.L~,/IJc> ") DATE OF DOCillvlENT If} ~/ .ke/ .J..eI,.?4./ . ( I NUMBER OF PAGES SIGNER(S) OTHER THAN NAMED ABOVE .#iY9 -' SIGNER'S NAME SIGNER'S NAME RIGIIT lHUMBPRINT RIGIIT lHUMBPRINT