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HomeMy WebLinkAboutAgenda Report - April 20, 2022 C-15CITY OF � z CALIFORNIA COUNCIL COMMUNICATION AGENDA ITEM C1015 AGENDA TITLE: Adopt Resolution Accepting Lease Extension No. 1 with The Village Adult Developmental and Community Center, located at 25 East Pine Street MEETING DATE: April 20, 2022 PREPARED BY: Public Works Director RECOMMENDED ACTION: Adopt Resolution Accepting Lease Extension No. 1 with The Village Adult Developmental and Community Center, located at 25 East Pine Street. BACKGROUND INFORMATION: On March 28, 2018, the City entered into a lease agreement with The Village Adult Developmental and Community Center (The Village) for the property located at 25 East Pine Street. The tenant originally agreed to pay $2,472.50 per month for the first six months of the lease term, and $2,687.50 per month thereafter. The original lease expired on April 30, 2021. The City and tenant mutually agreed to continue original lease on a month-to-month basis for a period of one (1) year due to uncertainties related to the COVID-19 pandemic. The proposed extension includes a five-year term of the agreement through April 30, 2027, a lease rate of $2,687.50 per month, and the option for The Village to terminate the lease prior to the five-year expiration. To exercise the termination option, tenant must be in good standing under the terms of the agreement and deliver a written notice of termination 60 days prior to end of termination date. Staff recommends Council adopt a resolution accepting Lease Extension No. 1 with The Village Adult Developmental and Community Center, located at 25 East Pine Street. FISCAL IMPACT- The proposed lease will provide annual rental revenue to the Transit fund in the amount of $32,250. FUNDING AVAILABLE: Not applicable. C "-aQ Charles E. Swimley, Jr. Public Works Director CES/JT/ib Signature: 42h jlp, i, Ju_? I I-)', r'Dil Email: sschwabauer@lodi.gov APPROVED: Steve Schwabauer Stephen Schwabauer, City Manager \\cvcfilv02\pubwks$\Transit\11) Agreements & Contracts\Parking Structure Lease -Village Adult Day Care\Lease Agreement\2022\CC_ 25 East Pine Street Lease docz 4/6/2022 EXTENSION NO. 1 LEASE AGREEMENT 25 EAST PINE STREET, LODI, CA THE VILLAGE: ADULT DEVELOPMENTAL AND COMMUNITY CENTER THIS EXTENSION NO. 1 TO LEASE AGREEMENT, is made and entered this day of , 2022, by and between the CITY OF LODI, a municipal corporation (hereinafter "CITY"), and THE VILLAGE: ADULT DEVELOPMENTAL AND COMMUNITY CENTER, a Nonprofit Public Benefit California Corporation (hereinafter "TENANT"). WITNESSETH: 1. WHEREAS, CITY and TENANT entered into a Lease Agreement on March 28, 2018 (the "Agreement"), as set forth in Exhibit 1, attached hereto and made part of; and 2. WHERAS, On April 30, 2021 the original lease expired; and 3. WHEREAS, CITY and TENANT mutually agreed to continue the Agreement on a month- to-month basis for a period of one (1) year due to uncertainties related to the COVID-19 pandemic; and 4. WHEREAS, CITY and TENANT mutually agree to extend the Agreement five -years through and including April 30, 2027; and 5. WHEREAS, TENANT agrees to pay CITY the sum of $2,687.50 per month as rent; and 6. WHEREAS, TENANT has the option to terminate the Agreement following 60 days' written notice to CITY, without further obligation, provided TENANT is in good standing under the terms of the Agreement; and 7. WHEREAS, TENANT agrees to the extension of the lease term and monthly rental payments, as set forth above. All other terms will remain as set forth in the Agreement. NOW, THEREFORE, the parties agree to extend the term of the Agreement through and including April 30, 2027, with monthly rent of $2,687.50 payable to CITY, and the option of TENANT to terminate the Agreement on 60 -days' written notice, provided TENANT is in good standing. With these exceptions, all other terms and conditions of the Agreement remain unchanged. IN WITNESS WHEREOF, CITY and TENANT have executed this Extension No. 1 on the date and year first above written. CITY OF LODI, a municipal corporation By STEPHEN SCHWABAUER City Manager ATTEST. PAMELA M. FARRIS Assistant City Clerk THE VILLAGE: ADULT DEVELOPMENTAL AND COMMUNITY CENTER, a Nonprofit Public Benefit California Corporation By KATHY PIAZZA Chief Executive Officer APPROVED AS TO FORM: JANICE D. MAGDICH City Attorney LEASE AGREEMENT 25 East Pine Street Lodi, California THIS AGREEMENT, made and entered into this A& day of IA cci—, , 201 by and between the CITY OF LODI, a municipal corporation, (hereinafter "Owner"), and THE VILLAGE: ADULT DEVELOPMENTAL AND COMMUNITY CENTER, a Nonprofit Public Benefit Corporation, hereinafter ("Tenant"). WITNESSETH: 1. PROPERTY: That for and in consideration of the rents to be paid, and the covenants to be faithfully kept and performed by Tenant, Tenant does hereby rent from Owner, the premises located at 25 East Pine Street, Lodi, California and all improvements thereto (the "Property") for the operation of a curriculum based day program for developmentally disabled adults and a community center for intellectually and developmentally disabled people, and their families, in and around the community. 2. TERM/RENEWAL: The term of this Agreement shall begin on May 1, 2018 ("Commencement Date") or on a date mutually agreed to by the parties if the California Community Care Licensing Department issues an adult day care program license to Tenant, and shall continue until April 30, 2021. Tenant shall have the right and option to extend this Agreement for an additional period of one, two or three years, at Tenant's election, the renewal term to commence May 1, 2021; to exercise the option, Tenant must be in good standing, and Tenant must deliver a written notice of renewal to Owner not later than 90 days prior to the end of the initial term; this Agreement shall be renewed at fair market value, which the parties will endeavor to agree upon in good faith, based on similarly situated properties in the same geographic area as the Property. 3. RENT: In consideration of this Agreement, Tenant agrees to pay to Owner as rent for the Property the sum of $2,472.50 per month for the first six months of the lease term, and $2,687.50 per month thereafter, due and payable by the 1s' day of each month, commencing on Lag I , 2018. A late charge of $60 may be assessed for any payment more than 115 days past due. Rental payments shall be directed to the City of Lodi, Attn: Public Works Department - Transit, P.O. Box 3006, Lodi, CA 95241, or in person to City Hall, located at 221 West Pine Street, Lodi, California, 95240, for processing and shall be paid without prior notice or demand to Tenant by Owner. 4, USE/USE PROHIBITED: The Property shall be used solely for the purpose of operating a curriculum based day program for developmentally disabled adults and a community center for intellectually and developmentally disabled people, and their families, in and around the community. The person -centered program works with each member's family and caregivers to create a meaningful daily experience while developing functional skills in a community based environment. Tenant shall not use any portion of the Property for purposes other than those specified herein, and no use shall be made or permitted to be made upon the Property, nor acts done, which will increase the existing rate of insurance upon the Property, or cause cancellation of insurance policies covering the Property. Tenant shall not engage in Zany activities excluded from coverage under its insurance policy on the Property. Tenant shall not conduct or permit any sale by auction on the Property. 5. ORDINANCES AND STATUTES: It is further understood and agreed by Tenant that Tenant must comply with all present and future laws, ordinances, rules, and regulations promulgated by any governmental authority of competent jurisdiction regulating the type of business to be conducted on the Property during the term of this Agreement and any extension thereof. Tenant shall use and occupy the Property in a quiet, lawful, and orderly manner. The commencement of pendency of any state or federal court abatement proceeding affecting the use of the Property shall, at the option of the Owner, be deemed a breach hereof. 6. SIGNS: Tenant shall not construct any projecting sign or awning without prior written consent of Owner which consent shall not be unreasonably withheld. It is agreed that Tenant will post "Hours of Operation" signs on the doors of the Property. All signs and locations of signs must be approved by the City of Lodi Public Works Director or designee. All costs associated with the purchase and installation of signs shall be the responsibility of Tenant. 7. ABANDONMENT OF PROPERTY: Tenant shall not vacate or abandon the Property at any time during the term hereof, including extensions, and if Tenant shall abandon or vacate the Property, or be dispossessed by process of law, or otherwise, any personal property belonging to Tenant left upon the Property shall be deemed to be abandoned, at the option of Owner. 8. TRADE FIXTURES: Any and all improvements made to the Property during the term hereof, including extensions, shall belong to the Owner, except trade fixtures of the Tenant. Tenant may, upon termination hereof, remove all trade fixtures, but shall repair or pay Owner for all repairs caused by damage to the Property occasioned by the removal of such trade fixtures. 9. DESTRUCTION OF THE PROPERTY: In the event of a partial destruction of the Property during the term hereof, from any cause, Owner shall forthwith repair the same, provided that such repairs can be made within sixty (60) days under existing governmental laws and regulations, but such partial destruction shall not terminate this Agreement, except that Tenant shall be entitled to a proportionate reduction of rent while such repairs are being made, based upon the extent to which the making of such repairs shall interfere with the business of Tenant on the Property. If such repairs cannot be made within sixty (60) days, Owner, at his option, may make the same within a reasonable time, this Agreement continuing in effect with the rent proportionately abated as aforesaid, and in the event that Owner shall not elect to make such repairs which cannot be made within sixty (60) days, this Agreement may be terminated at the option of either party. In the event that the building in which the Property may be situated is destroyed to an extent of not less than one-third of the replacement costs thereof, Owner may elect to terminate this Agreement whether the Property be injured or not. A total destruction of the building in which the Property may be situated shall terminate this Agreement. In the event of any dispute between Owner and Tenant with respect to the provisions hereof, the matter shall be settled by arbitration in such a manner as the parties may agree upon, or if they cannot agree, in accordance with the rules of the American Arbitration Association then in effect. 2 10. INSOLVENCY: In the event a receiver is appointed to take over the business of Tenant, or in the event Tenant makes a general assignment for the benefit of creditors, or Tenant takes or suffers any action under any insolvency or bankruptcy act, the same shall constitute breach of this Agreement by Tenant. 11. REMEDIES OF OWNER ON DEFAULT: In the event of any breach of this Agreement by Tenant, Owner may, at its option, terminate this Agreement and recover from Tenant: (a) the worth at the time of award of the unpaid rent which was earned at the time of termination; (b) the worth at the time of award of the amount by which the unpaid rent which would have been earned after termination until the time of the award exceeds the amount of such rental loss that the Tenant proves could have been reasonably avoided; (c) the worth at the time of award of the amount by which the unpaid rent for the balance of the term after the time of award exceeds the amount of such rental loss that Tenant proves could be reasonably avoided; and (d) any other amount necessary to compensate Owner for all detriment proximately caused by Tenant's failure to perform its obligations under this Agreement or which in the ordinary course of things would be likely to result therefrom. Owner may, in the alternative, continue this Agreement in effect, as long as Owner does not terminate Tenant's right to possession, and Owner may enforce all his rights and remedies under this Agreement, including the right to recover the rent as it becomes due under this Agreement. If such breach continues, Owner may, at any time thereafter, elect to terminate this Agreement. Nothing contained herein shall be deemed to limit any other rights or remedies which Owner may have. 12. RELATIONSHIP OF PARTIES: It is understood and agreed that the relationship between the parties is that of landlord and tenant and not as a party or agent of Owner. Tenant, shall carry Worker's Compensation Insurance and observe all laws and regulations applicable to employers in the State of California. 13. BUILDING INTERIOR MAINTENANCE: Building Interior Maintenance (Janitorial Services) shall be the responsibility of Tenant. 14. ASSIGNMENT AND SUBLETTING: Tenant shall not assign this Agreement or sublet any portion of the Property without prior written consent of the Owner, which shall not be unreasonably withheld. Any such assignment or subletting without consent shall be void and, at the option of the Owner, may terminate this Agreement. 15. ENTRY AND INSPECTION: Tenant shall permit Owner or Owner's agents to enter upon the Property at reasonable times and upon reasonable notice, for the purpose of inspecting the same. 16. MAINTENANCE, REPAIRS, ALTERATIONS OR ADDITIONS: Tenant acknowledges that the Property is in good order and repair, unless otherwise indicated herein. Tenant shall, at his own expense and at all times, maintain the Property in good and safe condition, and shall surrender the same, at termination hereof, in as good condition as received, normal wear and tear excepted. Tenant shall be responsible for all repairs required, excepting the roof, exterior plate glass, exterior walls, structural foundations, HVAC and all other items installed by the Owner, and common areas which shall be maintained by Owner unless damaged by Tenant's use. No repairs, alterations or additions to the Property shall be made without prior written consent of Owner. Prior to the commencement of any substantial repair, improvement, or alteration, Tenant shall give Owner at least two (2) days written notice in order that Owner may post appropriate notices to avoid any liability for liens. Tenant shall not commit any waste upon the Property, or any nuisance or act which may disturb the quiet enjoyment of any tenant of Owner. Any concerns shall be submitted in writing to the Public Works Director, City of Lodi, P. O. Box 3006, Lodi, CA 95241. 17. TENANT IMPROVEMENTS: Tenant improvements shall be provided for and funded by Tenant. Construction of Tenant improvements shall commence upon issuance of a building permit by CITY at Tenant's expense. 18. SECURITY FOR TENANT IMPROVEMENTS: Tenant shall post security with City in a form and a reasonable amount acceptable to the City Attorney upon commencement of any tenant improvements on the Property that requires a building permit. The security will be forfeited to the City in the event the Tenant fails to comply with its Tenant improvement obligations but will be returned in the event Tenant fully complies with its Tenant improvement obligations. 19. CONSTRUCTION TIMELINE: The parties anticipate that the Tenant improvements will be completed within nine months of the execution of this Agreement, but in no event shall such improvements be completed later than November 1, 2018. Failure of the Tenant to complete the construction of Tenant improvements as agreed upon by Owner shall be deemed a material breach of this Agreement. 20. OWNERSHIP OF IMPROVEMENTS UPON TERMINATION OR EXPIRATION OF LEASE: Upon surrender, termination or expiration of this Agreement, ownership of the Tenant improvements shall vest in the City. 21. SURRENDER OF PREMISES: Tenant shall, at the termination of the Agreement hereby created, or upon the earlier termination hereof for any reason, or upon the extension of the term herein set forth, quit and surrender the Property in good order, condition, and repair, reasonable wear and tear and acts of God or fire excepted. 22. FEES: Tenant shall pay all license fees, or other fees or taxes, including possessory interest taxes, levied by any governmental agency which may be imposed upon the business of Tenant or its subtenant conducted upon the Property. If any of the above charges are assessed against the Property, and because of said assessment, the Owner pays the same, the Owner will have the right to, regardless of the validity of any such levy, demand that Tenant repay to Owner all taxes and other assessments so levied against Owner. Failure of Tenant to pay such levy will constitute a breach of this Agreement. 23. UTILITIES: Tenant agrees that it shall be responsible for the payment of all utilities, including water, wastewater, gas, and electricity. During the term of this Agreement, and any extension thereof, it is understood and agreed by the parties hereto that Tenant shall be responsible for the installation, maintenance and cost of any telephone lines installed or used by Tenant, and solid waste removal, at no cost to Owner. 24. MECHANIC'S LIEN: Tenant agrees to keep the Property free from all liens and claims of mechanics, laborers, material suppliers, and others for work done, and material 4 furnished, and Tenant shall not create, or suffer to be created, any lien or encumbrance on the Property. 25, PUBLIC LIABILITY AND PROPERTY DAMAGE INSURANCE: Tenant, at its expense, shall maintain public liability insurance including bodily injury and property damage insuring Tenant and Owner with minimum coverage of $3,000,000 each occurrence. More particularly described as follows: Tenant agrees to indemnify, defend and save harmless Owner from and against all claims of whatever nature arising from any act, omission, or negligence of Tenant or Tenant's contractors, licensees, agents, servants, or employees, or arising from any accident, injury, or damage whatsoever caused any person, or to the Property of any person, occurring during the term thereof, in or about the Property where such accident, damage, or injury, including death, results, or is claimed to have resulted, from any act or omission on the part of Tenant or Tenant's agents or employees. This indemnity and hold harmless agreement shall include indemnity against all costs and expenses, including attorney's fees incurred in or in connection with any such claim or proceeding brought thereon and the defense thereof. Tenant agrees to maintain in full force during the term hereof a policy of public liability insurance under which Tenant is named as insured, and containing an additional named insured endorsement naming Owner as an additional insured, and under which the insurer agrees to indemnify and hold Tenant and Owner harmless from and against all costs, expenses, and liability arising out of, or based upon, any and all property damage, or damages for personal injuries, including death, sustained in accidents occurring in or about the Property, where such accident, damage, or injury, including death, results, or is claimed to have resulted, from any act or omission on the part of Tenant, or Tenant's agents or employees. The minimum limits of such insurance shall be $3,000,000.00 (Three Million Dollars). In addition to the additional named insured endorsement on Owner's policy of insurance, said insurance policy shall be endorsed to include the following language: "Insurance as is afforded by the endorsement for additional insureds shall apply as primary insurance. Any other insurance maintained by the City of Lodi or its elected and appointed officials, officers, directors, and employees shall be excess only and not contributing with the coinsurance afforded by this endorsement." To the maximum extent permitted by insurance policies which may be owned by Owner or Tenant, Owner and Tenant, for the benefit of each other, waive any and all rights of subrogation which might otherwise exist. A duplicate or certificate of said public liability and property damage insurance policy containing the above -stated required endorsements shall be delivered to Owner within ten (10) days after the issuance and each renewal of said policy. This paragraph, and all other provisions of this Agreement, shall apply and be construed as applying to any subtenant of Tenant. Proof of insurance is subject to approval of Owner's Risk Manager. 26. BANKRUPTCY, RECEIVERSHIP, AND INSOLVENCY: If Tenant should make a general assignment for the benefit of creditors, or file a voluntary petition in bankruptcy, or be adjudicated bankrupt or insolvent, or permit a receiver to be appointed to take possession of a substantial portion of its assets or of the premises, and such bankruptcy, insolvency, or receivership proceeding shall not be dismissed within ninety (90) days, then Owner may, without notice or demand, terminate this Agreement and forthwith reenter and repossess the Property, and remove all persons therefrom, and under no circumstances shall this Agreement be assignable or transferable by operation of law. 27. ATTORNEY'S FEES: In case suit should be brought for recovery of the Property, or for any sum due hereunder, or because of any act which may arise out of the possession of the Property, by either party, the prevailing party shall be entitled to all costs incurred in connection with such action, including a reasonable attorney's fee, the amount of which shall be determined by the court in such suit and added to and become a part of the judgment therein. 28. WAIVER: Failure of Owner to insist upon performance of any of the terms or conditions of this Agreement in any one or more instances shall in no event be construed as a waiver or a relinquishment of its right to future performance thereof, and Tenant's obligations to such future performance shall continue in full force and effect. The receipt by Owner of rent, with the knowledge of the breach of this Agreement or condition hereof, shall not be determined to be a waiver of any such breach. 29. NOTICES: Any notice which either party may or is required to give, shall be given by mailing the same, postage prepaid, to Tenant at the premises, or Owner at the address shown below, or at such other places as may be designated by the parties from time to time as provided herein. OWNER: Public Works Director City of Lodi — Public Works Department - Transit P. O. Box 3006 Lodi, California 95241 TENANT: The Village: Adult Developmental and Community Center 32 North Sunset Drive Lodi, CA 95240 Attention: Kathy Piazza, Program Director 30, HOLDING OVER: If applicable under this Agreement, any holding over after the expiration of this Agreement, with the consent of Owner, shall be construed as a month- to-month tenancy at a rental of 110% of the most recent rental rate per month, otherwise in accordance with the terms hereof, as applicable. 31. TIME: Time is of the essence of this Agreement. 32. HEIRS, ASSIGNS, SUCCESSORS: This Agreement is binding upon and inures to the benefit of the heirs, assigns and successors in interest to the parties. 33. BUSINESS LICENSE: Tenant acknowledges that Lodi Municipal Code Section 3.01.020 requires Tenant to have a city business license and Tenant agrees to secure such license and pay the appropriate fees prior to execution of this Agreement. 6 34. OWNER'S LIABILITY: The term "Owner" as used in this paragraph, shall mean only the owner of the real property that is the subject of this Agreement. In the event of any transfer of such title or interest, the Owner named herein (or the grantor in case of any subsequent transfers) shall be relieved of all liability related to Owner's obligations to be performed after such transfer. Provided, however, that any funds in the hands of Owner or Grantor at the time of such transfer shall be delivered to Grantee. Owner's aforesaid obligations shall be binding upon Owner's successors and assigns only during their respective periods of ownership. 35. ACCEPTANCE OF THE PREMISES: Tenant has examined the Property knows the conditions thereof, and accepts possession thereof in its present condition. 36. GOVERNING LAW: This Agreement shall be construed and governed by California law. 37. AUTHORITY: The signatories to this Agreement represent that each has full right, power, and authority to execute this Agreement on behalf of the entity each purports to represent. 38. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement and understanding of the parties and supersedes all offers, negotiations, and other agreements of any kind. There are no representations or understandings of any kind not set forth herein. Any modification of or amendment to this Agreement must be in writing and executed by both parties. IN WITNESS WHEREOF, Owner and Tenant have executed this Agreement on the date and year first above written. "OWNER" "TENANT" CITY OF LODI, a municipal corporation THE VILLAGE: ADULT DEVELOPMENTAL AND COMMUNITY CENTER, a Nonprofit Public Benefit California corporation STEPHEN SC AUER KATHY IAZZA City Manager Chief • xecutive O icer ATTEST: 1 NFM.A�� 'Elk, Own, ••• • F C�-Iew- Dated: 3 WLE APPROVED AS TO FORM: JANICE D. MAGDICH City Attorney RESOLUTION NO. 2022-96 A RESOLUTION OF THE LODI CITY COUNCIL AUTHORIZING THE CITY MANAGER TO EXECUTE LEASE EXTENSION NO. 1 WITH THE VILLAGE ADULT DEVELOPMENTAL AND COMMUNITY CENTER, LOCATED AT 25 EAST PINE STREET WHEREAS, on March 28, 2018, the City entered into a lease agreement with The Village Adult Developmental and Community Center (The Village) for the property located at 25 East Pine Street; and WHEREAS, the tenant originally agreed to pay $2,472.50 per month for the first six months of the lease term, and $2,687.50 per month thereafter; and WHEREAS, the lease extension includes a five-year term of the agreement through April 30, 2027, a lease rate of $2,687.50 per month, and the option for The Village to terminate the lease prior to the five-year expiration; and WHEREAS, to exercise the termination option, the tenant must be in good standing under the terms of the agreement and deliver a written notice of termination 60 days prior to end of termination date; and WHEREAS, staff recommends authorizing the City Manager to execute Lease Extension No. 1 with The Village Adult Developmental and Community Center, located at 25 East Pine Street. NOW, THEREFORE, BE IT RESOLVED that the Lodi City Council does hereby authorize the City Manager to execute Lease Extension No. 1 with The Village Adult Developmental and Community Center, located at 25 East Pine Street; and BE IT FURTHER RESOLVED, pursuant to Section 6.3q of the City Council Protocol Manual (adopted 11/6/19, Resolution No. 2019-223), the City Attorney is hereby authorized to make minor revisions to the above -referenced document(s) that do not alter the compensation or term, and to make clerical corrections as necessary. Dated: April 20, 2022 I hereby certify that Resolution No. 2022-96 was passed and adopted by the City Council of the City of Lodi in a regular meeting held April 20, 2022 by the following votes: AYES: COUNCIL MEMBERS — Hothi, Khan, Kuehne, Nakanishi, and Mayor Chandler NOES: COUNCIL MEMBERS — None ABSENT: COUNCIL MEMBERS — None ABSTAIN: COUNCIL MEMBERS — None owvdl� OLIVIA NASHED City Clerk 2022-96