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07-0619_DAVID TAUSSIG & ASSOCIATES, INC._Consultant Services Agreement0 C] CONSULTANT SERVICES AGREEMENT THIS AGREEMENT is made and entered into this 19th day of June, 2007, by and between the City of San Juan Capistrano (hereinafter referred to as the "City") and David Taussig & Associates, Inc. (hereinafter referred to as "Consultant"). RECITALS: WHEREAS, City desires to retain special tax consulting services for analyzing Centra Realty's request for a Community Facilities District at their Ventanas Business Center; and, WHEREAS, Consultant is qualified by virtue of experience, skills, training, education and expertise to accomplish such services; and, WHEREAS, The City is a municipal corporation duly organized and validly existing under the laws of the State of California with the power to carry on its business as it is now being conducted under the statutes of the State of California; and, WHEREAS, City has solicited and received a proposal from Consultant, has reviewed the previous experience and evaluated the expertise of Consultant, and desires to retain Consultant to render professional consulting services under the terms and conditions set forth in this Agreement. NOW, THEREFORE, City and Consultant mutually agree as follows: Section 1. Scope of Work. The scope of work to be performed by Consultant shall consist of those tasks as set forth in Exhibit'A," attached and incorporated herein by reference. Consultant warrants that all of its services shall be performed in a competent, professional and satisfactory manner and in accordance with the prevalent standards of its profession. Section 2. Term. This Agreement shall commence on the effective date of this Agreement and services required hereunder shall be completed by no later than September 30, 2007. Section 3. Compensation. 3.1 Amount. City shall pay Consultant upon the submission of required work product Page 1 of 13 0 0 prepared to the satisfaction of the City for each task as set forth in Exhibit "A" the Scope of Work Total compensation for the scope of services for this Project shall not exceed twenty five thousand dollars ($25,000.00) plus a percentage of Bond issuance for consultation tasks 1 through 11, as set forth in Exhibit "B," attached and incorporated herein by reference. No payments for expenses or labor shall be paid by City unless it is related to this Agreement. 3.2 Rate Schedule. The services shall be billed to the City at the hourly rate set forth in Exhibit "C," attached and incorporated herein by reference. Included within the compensation are the entire Consultant's ordinary office and overhead expenses incurred by it, its agents and employees, including meetings with the City representatives and incidental costs to perform the stipulated services. Submittals shall be in accordance with Consultant's proposal. 3.3 Method of Payment. The City shall pay Consultant upon the completion of services required hereunder and upon submission of invoice by Consultant for tasks which have been satisfactorily completed. For extra work not part of this Agreement, a written authorization from the City is required prior to Consultant undertaking any extra work. 3.4 Records of Expenses. Consultant shall keep complete and accurate records of all expenses incidental to services covered by this Agreement. These records will be made available at reasonable times to City. Section 4. Independent Contractor. It is agreed that Consultant shall act and be an independent contractor and not an agent or employee of City, and shall obtain no rights to any benefits which accrue to City's employees. Section 5. Limitations Upon Subcontracting and Assignment. The experience, knowledge, capability and reputation of Consultant, its principals and employees were a substantial inducement for City to enter into this Agreement. Consultant shall not contract with any other entity to perform the services required without written approval of the City. This Agreement may not be assigned, voluntarily or by operation of law, without the prior written approval of the City. If Consultant is permitted to subcontract any part Page 2 of 13 0 0 of this Agreement by City, Consultant shall be responsible to City for the acts and omissions of its subcontractor as it is for persons directly employed. Nothing contained in this Agreement shall create any contractual relationships between any subcontractor and City. All persons engaged in the work will be considered employees of Consultant. City will deal directly with and will make all payments to Consultant. Section 6. Changes to Scope of Work. In the event of a change in the Scope of Work provided for in the contract documents as requested by the City, the Parties hereto shall execute an addendum to this Agreement setting forth with particularity all terms of the new agreement, including but not limited to any additional Consultant's fees. Section 7. Familiarity with Work and Construction Site. By executing this Agreement, Consultant warrants that: (1) it has investigated the work to be performed; (2) it understands the facilities, difficulties and restrictions of the work under this Agreement. Should Consultant discover any latent or unknown conditions materially differing from those inherent in the work or as represented by City, it shall immediately inform City of this and shall not proceed with further work under this Agreement until written instructions are received from the City. Section 8. Time of Essence. Time is of the essence in the performance of this Agreement. Section 9. Compliance with Law. Consultant shall comply with all applicable laws, ordinances, codes and regulations of federal, state and local government. Section 10. Conflicts of Interest. Consultant covenants that it presently has no interest and shall not acquire any interest, direct or indirect, which would conflict in any manner or degree with the performance of the services contemplated by this Agreement. No person having such interest shall be employed by or associated with Consultant. Section 11. Copies of Work Product. At the completion of the contract period, Consultant shall have delivered to City at least one (1) copy of any final reports containing Consultant's findings, conclusions, and recommendations with any support documentation. All reports submitted to the City shall be in reproducible format. All services to be rendered hereunder shall be subject to the direction and Page 3 of 13 0 approval of the City. Section 12. Ownership of Documents. 11 All reports, information, data and exhibits prepared or assembled by Consultant in connection with the performance of its services pursuant to this Agreement are confidential to the extent permitted by law, and Consultant agrees that they shall not be made available to any individual or organization without prior written consent of the City. All such reports, information, data, and exhibits shall be the property of the City and shall be delivered to the City upon demand without additional costs or expense to the City. The City acknowledges such documents are instruments of Consultant's professional services. Notwithstanding the above, all computer financial models including without limitation compilations of formulas and spreadsheet models used or developed by the Consultant in performing its work are proprietary and shall remain property owned solely by the Consultant. Section 13. Indemnity. Consultant agrees to protect, defend and hold harmless City, its elected and appointed officials and employees from any and all claims, liabilities, expenses or damages of any nature, including attorneys' fees, for injury or death of any person or damage to property or interference with use of property and for errors and omissions committed by Consultant arising out of or in connection with the work, operation or activities of Consultant, its agents, employees and subcontractors in carrying out its obligations under this Agreement. Notwithstanding the above, for purposes of Professional Liability, Consultant shall only indemnify, protect, defend and hold harmless City and any and all of its officials, and employees and agents ("Indemnified Parties") from and against any and all loses, liabilities, damages, costs and expenses, including reasonable attorney's fees and costs to the extent same are caused in whole or in part by any negligent or wrongful act, error or omission of Consultant, its officers, agents, employees or sub consultants (or any entity or individual that Consultant shall bear legal liability thereof) in the performance of professional services under this Agreement. Section 14. Insurance. Insurance required herein shall be provided by Admitted Insurers in good standing with the State of California and having a minimum Best's Guide Rating of A - Class VII or better. 14.1 Comprehensive General Liability. Throughout the term of this Agreement, Consultant shall maintain in full Page 4 of 13 r� F_ 1 force and effect Comprehensive General Liability coverage in the following minimum amounts: $500,000 property damage; $500,000 injury to one person/any one occurrence/not limited to contractual period; $1,000,000 injury to more than one person/any one occurrence/not limited to contractual period. 14.2 Comprehensive Automobile Liability. Throughout the term of this Agreement, Consultant shall maintain in full force and effect Comprehensive Automobile Liability coverage, including owned, hired and non -owned vehicles in the following minimum amounts: $500,000 property damage; $500,000 injury to one person/any one occurrence/not limited to contractual period; $1,000,000 injury to more than one person/any one occurrence/not limited to contractual period 14.3 Worker's Compensation. If Consultant intends to employ employees to perform services under this Agreement, Consultant shall obtain and maintain, during the term of this Agreement, Worker's Compensation Employer's Liability Insurance in the statutory amount as required by state law. 14.4 Proof of Insurance Requirements/Endorsement. Prior to beginning any work under this Agreement, Consultant shall submit the insurance certificates, including the deductible or self -retention amount, and an additional insured endorsement to the Consultant's general liability policies to the City's General Counsel for certification that the insurance requirements of this Agreement have been satisfied. 14.5 Errors and Omissions Coverage Throughout the term of this Agreement, Consultant shall maintain Errors and Omissions Coverage (professional liability coverage) in an amount of not less than One Million Dollars ($1,000,000). Prior to beginning any work under this Agreement, Consultant shall submit an insurance certificate to the Clerk of the Board's office for Page 5 of 13 0 0 certification that the insurance requirements of this Agreement have been satisfied. 14.6 Notice of Cancellation/Termination of Insurance. The above policy/policies shall not terminate, nor shall they be cancelled, nor the coverage's reduced, until after thirty (30) days' written notice is given to City, except that ten (10) days' notice shall be given if there is a cancellation due to failure to pay a premium. 14.7 Terms of Compensation. Consultant shall not receive any compensation until all insurance provisions have been satisfied. 14.8 Notice to Proceed. Consultant shall not proceed with any work under this Agreement until the City has issued a written "Notice to Proceed" verifying that Consultant has complied with all insurance requirements of this Agreement. Section 15. Termination. City and Consultant shall have the right to terminate this Agreement without cause by giving thirty (30) days' advance written notice of termination to the other party In addition, this Agreement may be terminated for cause by providing ten (10) days' notice to the other party of a material breach of contract. If the other party does not cure the breach of contract, then the agreement may be terminated subsequent to the ten (10) day cure period. Section 16. Notice. All notices shall be personally delivered or mailed to the below listed addresses, or to such other addresses as may be designated by written notice. These addresses shall be used for delivery of service of process: To City: City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 Attn: Douglas D. Dumhart, Economic Development Manager To Consultant: David Taussig & Associates, Inc. 1301 Dove Street, Suite 600 Newport Beach, California 92660 Attn: Andrea Roess, Senior Vice President Page 6 of 13 0 0 Section 17. Attorneys' Fees. If any action at law or in equity is necessary to enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to reasonable attorneys' fees, costs and necessary disbursements in addition to any other relief to which he may be entitled. Section 18. Dispute Resolution. In the event of a dispute arising between the parties regarding performance or interpretation of this Agreement, the dispute shall be resolved by binding arbitration under the auspices of the Judicial Arbitration and Mediation Service ("JAMS"). Section 19. Entire Aareement. This Agreement constitutes the entire understanding and agreement between the parties and supersedes all previous negotiations between them pertaining to the subject matter thereof. viA /// /// N /// Page 7 of 13 0 0 IN WITNESS WHEREOF, the parties hereto have executed this Agreement. David Taussig, APPROVED AS TO FORM: • -ENDS l! Page 8 of 13 0 0 Exhibit A Scope of Work David Taussig & Associates, Inc. shall provide special tax consulting services, as described in the tasks below, necessary to assist the City in the formation of a CFD to fund certain fees and improvements. Task 1. Initial Meeting Attend an initial meeting to discuss the scope of work, proposed schedule, and to identify any other issues prior to beginning work. Task 2. Research Gather the necessary data from the developer (the "Project Developer"), and/or the City with the assistance of DTA. The Project Developer and/or the City are responsible for providing and verifying data describing types of projected development, improved property values, development absorption rates, net taxable acreage, and the estimated cost of the public improvements proposed to be financed. DTA shall rely on such data provided by the City and Project Developer, and shall not be responsible for verifying its accuracy. Verification of project information by city staff does not constitute the projects land use approvals or entitlements. The City may hire an appraiser or other outside consultants to verify this data. DTA shall also compile assessor's data for the project area. Task 3. Preliminary Tax Spread Prepare initial spread of special taxes (the "Tax Spread") based on land use, building square footage, and/or acreage as obtained through Task 2 above. Calculate special taxes to support proposed financing. DTA may recommend alternative techniques to apportion special taxes to enhance project feasibility. Task 3A. Tax Spreads for Additional Improvement Areas or Zones (OPTIONAL) Should more than one Project Developer participate in the CFD, and should it be necessary to establish separate Improvement Areas or Zones for any of these additional Project Developers, DTA shall prepare Tax Spreads and undertake the activities listed under Task 3 for each additional Improvement Area or Zone. The City and each additional Project Developer shall have the same responsibilities as listed under Task 3. This may require additional fees. Task 4. Rate & Method of Apportionment Prepare the Rate and Method of Apportionment of Special Tax (the "RMA") which describes the methodology used to calculate the annual special tax levy for the CFD. DTA shall work with City staff to modify the RMA as needed. Page 9 of 13 0 0 Task 5. Public Report Prepare the Public Report, as described in Section 53321.5 of the California Government Code, containing descriptions of the proposed public facilities, their estimated costs, projected bonded indebtedness, the anticipated issuance date and maximum annual special tax rates. Task 6. Document Review and Preparation Assist Bond Counsel and Underwriter's Counsel with the preparation of required documents, including the Resolution of Intention, Resolution of Formation, various tables in the Official Statement and related items. Also provide necessary data and advice to Bond Counsel regarding the implementation of the CFD, including policies which address changes in land uses which occur after district formation, parity bonds tests, integration of reimbursement programs from the State or other public districts or fee programs, and the formation of an advisory board to make decisions regarding the issuance of parity bonds and/or the enrollment of special taxes. Task 7. Bond Sizing Assist Underwriter in sizing of bond issue (e.g., use of increasing debt service, capitalized interest, etc.) to establish an optimal schedule of bond sales to maximize funding capacity and generate the greatest possible benefit to all interested parties, as well as to alleviate cash flow constraints. Task 8. Special Tax Consultant Certificate DTA shall prepare and execute a Special Tax Consultant Certificate confirming the adequacy of special taxes to meet debt service requirements for first bond issue. If applicable, DTA shall require an executed landowner information certificate from each Project Landowner confirming net taxable acreage and other relevant data prior to executing the Special Tax Consultant Certificate. Task 9. Verbal Consulting Services Provide verbal consulting services and advice to City and Project Landowner regarding the financing during the period in which Tasks 1 through 8 are being completed. Task 10. Coordination DTA shall attend up to a total of six meetings (not including Task 1). These meetings may be used to discuss or present the Tax Spread, Rate and Method of Apportionment of Special Tax, Public Report, or other items prepared by DTA. They may also be used for the protest hearing, or other public meetings. After a total of six meetings attended by DTA have been completed, additional meetings will require fees beyond the maximum established in the Fee Schedule if the budgeted amount has been completely Page 10 of 13 0 0 expended based on hourly rates quoted herein. Task 11. Preparation of Boundary Map (optional) This task entails the preparation of the CFD boundary map pursuant to the requirements of the Mello -Roos Act and the County Recorder's Office, assuming that computerized base maps are provided by Project Developer. Record map at the County Recorder's office and distribute copy of recorded map to the project team. Page 11 of 13 0 0 Exhibit B Fee Schedule Total compensation (excluding expenses) for completion of Tasks 1 through 10 of the Scope of Work should a Community Facilities District be formed and a first bond issue be sold shall be based on the size of the bond issue, due to the increased liability risk associated with larger bond issues. DTA's proposed budget for Optional Task 11 is $3,500. The total fee to be charged for Tasks 1 through 11 shall be based on the following schedule: First Bond Issue Size Less than $2,000,000 $2,000,000 - $5,000,000 $5,000,001 - $10,000,000 $10,000,001+ Total Fee (excluding Out-of-pocket Expenses) $25,000 $25,000 + 0.0035 of amount over $2,000,000 $35,500 + 0.0025 of amount over $5,000,000 $48,000 + 0.00075 of amount over $10,000,000 Prior to the sale of a first bond issue, DTA shall be remunerated for services based on the hourly rates shown in Exhibit C, with invoices being submitted to City on a monthly basis. Upon the sale of a first bond issue, any remaining portion of the total fee shall be paid from the proceeds of the issue. Should no bonds be sold, DTA shall only receive remuneration for hours worked and out-of-pocket expenses. Should more than one Project Landowner participate in the formation of the CFD, and should one or more of these additional Project Landowners desire to be placed in a separate Improvement Area or Zone from the first Project Landowner, additional time and materials may be charged, up to a maximum of $6,000 per Improvement Area or Zone (Optional Task 3A). Page 12 of 13 0 0 Exhibit C Hourly Rates President $225/Hour Senior Vice President - $210/Hour Vice President - $210/1 -lour Manager - $180/Hour Senior Associate - $160/Hour Associate - $140/Hour Senior Analyst - $130/Hour Analyst - $120/Hour Research Assistant - $100/Hour Consulting services related to the annual collection of special taxes, or the preparation of certifications or tax spreads for later bond issues, shall be covered under a separate Agreement. Any additional tasks assigned by City if the total fee listed in Exhibit B has been exceeded, shall be charged at the hourly rates listed above. An excessive number of meetings (more than seven including Task 1) or tax spread computer runs (more than fifteen) may also require additional fees if the total fee has been exceeded. Such additional fees shall be added to the 'Total Fee" amounts listed above. The hourly fees listed above apply for a twelve month period after execution of this Agreement, and are subject to a cost -of -living increase after that period and on an annual basis thereafter. In addition to fees for services, City shall reimburse DTA for travel, photocopying, and courier, facsimile, clerical, telephone expenses, and administrative charges, not to exceed $2,000. Page 13 of 13 11 32400 PASEO ADELANTO SAN JUAN CAPISTRANO, CA 92675 (949) 493-1171 (949) 4931053 FAX www.sanjuancapistrano.org TRANSMITTAL TO: Andrea Roess, Senior Vice President David Taussing & Associates, Inc. 1301 Dove Street, Suite 600 Newport Beach, CA 92660 DATE: July 25, 2007 FROM: Maria Morris, Deputy City Clerk (949) 443-6309 MEMBERS OF THE CITY COUNCIL SAM ALLEVATO THOMAS W. HRIBAR MARK NIELSEN JOE SOTO DR. LONDRES USO RE: Consultant Services Agreement — Ventanas Business Center Special tax Consulting Services Thank you for providing documentation confirming compliance with the terms of the agreement related to insurance. Please keep in mind this documentation must remain current with our office during the term of this agreement. If you have questions related to insurance requirements, please call me at (949) 443-6309. If you have questions concerning the agreement, please contact Douglas D. Dumhart, Economic Development Manager (949) 443-6316. An original agreement is enclosed for your records. Cc: Douglas D. Dumhart, Economic Development Manager San Juan Capistrano: Preserving the Past to Enhance the Future �..� Printed on 100%recycled paper 0 AGENDA REPORT TO: Dave Adams, City Manager 941` • 6/19/2007 FROM: Douglas D. Dumhart, Economic Development Manager D14 SUBJECT: Consideration of Consultant Services Agreement with David Taussig & Associates, Inc., for Special Tax Consulting Services. RECOMMENDATION: By motion, approve the Consultant Services Agreement with David Taussig & Associates, Inc., for Special Tax Consulting Services in an amount not to exceed $25,000 plus fees based on bonds issued, and authorize the Mayor to execute. SUMMARY: Centra Realty owners of the 18 vacant acres of property at the terminus of Calle Arroyo and the 1-5 freeway has requested the formation of a Community Facilities District (CFD) for their Ventanas Business Park project. They have requested the CFD to assist in the financing of extraordinary expenses and extensive public improvements and development fees associated with their project. See their letter dated February 8, 2007, provided as Attachment 1. Typically, municipalities seek out the services of a special tax consultant to utilize the consultant's specialized qualifications to advise and provide technical assistance to (i) ensure numerical and technical accuracy in the special tax calculations and apportionment methodology, (ii) develop an equitable distribution of the special tax burden, and (iii) otherwise assist with the structuring of a CFD in a manner which is consistent with the municipality's stated goals and policy objectives. Staff has identified David Taussig and Associates, Inc., (DTA) to assist with the processing of Centra Realty's request. At this time staff is recommending the City Council approve and execute the Consultant Services Agreement with DTA for work on the Ventanas Business Park CFD. BACKGROUND: DTA is a public finance and urban economics consulting firm that specializes in the preparation of financing plans and the implementation of public finance mechanisms used to fund the construction of public capital facilities and the provision of public services. DTA's consulting services include: Special Tax and Assessment Engineering Public Infrastructure and Public Services Financing Strategies Agenda Report • • June 19, 2007 Page 2 Fiscal and Economic Impact Analyses • Proposition 218 and AB 1600 Compliance Studies • Redevelopment Finance • Economic Development and Revitalization Studies Since its establishment in 1985, DTA has completed consulting assignments pertaining to the financing and public infrastructure and services for more than 2,000 clients in ten states. During this period, the firm has been involved in the formation of more than 1,500 public finance districts, with total bond authorizations exceeding $50 billion. DTA is particularly known for their specialized expertise in the design and administration of Mello -Roos community facilities districts. DTA has provided special tax consulting services for CFD formations to virtually every major city government in California, including the following: :• City of Anaheim e City of Ontario :• City of Arvin d• City of Orange :• City of Bakersfield d• City of Oxnard City of Banning ❖ City of Palmdale City of Barstow ❖ City of Pasadena o City of Beverly Hills •:• City of Pomona :• City of Buena Park :• City of Rancho Cucamonga City of Burbank f• City of Riverside :• City of Chino Hills ❖ City of Sacramento City of Encinitas ❖ City of San Bernardino City of Fillmore :• City of San Diego :• City of Fontana ❖ City of San Jacinto :• City of Fullerton d• City of San Jose City of Huntington Beach :• City of San Marcos City of Lake Forest 4 City of Santa Clarita :• City of Lancaster :• City of Seal Beach :• City of La Quinta E• City of Simi Valley • City of Lawndale ❖ City of Temecula :• City of Long Beach :• City of Thousand Oaks :• City of Los Angeles City of Torrance :• City of Newhall :• City of Tustin :• City of Oceanside California counties with whom DTA have successfully provided these same CFD formation services include the following: :• County of Contra Costa County of Imperial .• County of Kern County of Los Angeles County of Madera County of Orange County of Placer County of Riverside County of San Bernardino County of San Diego .• County of Santa Barbara Agenda Report • • June 19, 2007 Page 3 COMMISSION/BOARD REVIEW AND RECOMMENDATIONS: Not Applicable. FINANCIAL CONSIDERATIONS: The city would bear no costs associated with this Consultant Services Agreement. These expenses are covered in the Deposit/Reimbursement Agreement executed with the Developer. Should the CFD be formed and bonds issued the Developer is refunded their expenses from bond proceeds. DTA's fees can be found in Exhibit B of the Consultant Services Agreement provided as Attachment 2 to this report. NOTIFICATION: Stephen Sandland, Centra Realty" Denise Herring, Straddling, Yocca, Carlson & Rauth' James Fabian, Fieldman, Rolapp & Associates' Andrea Roess, David Taussig & Associates" Peter Piller, DPFP, Inc." ("Received copy of Agenda Report) RECOMMENDATION: By motion, approve the Consultant Services Agreement with David Taussig & Associates, Inc., for Special Tax Consulting Services in an amount not to exceed $25,000 plus fees based on bonds issued, and authorize the Mayor to execute. Respectfully submitted, Douglas D. Dumhart Economic Development Manager Attachments: 1. Letter from Centra Realty dated February 8, 2007. 2. Consultant Services Agreement with DTA 0 0 FEB 9 2007 CENTRA REALTY C 0 R P 0 R A T 1 0 N February 8, 2007 Mr. Douglas D. Dumhart Economic Development Manager City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 SUBJECT: Formation of a Community Facilities District Dear Douglas, Centra Realty Corporation, the managing partner for Centra Tirador LLC, hereby requests the consideration of the City of San Juan Capistrano for the formation of a Community Facilities District ("CFD") for the property between Calle Arroyo and the San Juan Creek as shown on the attached exhibit. The funds from this CFD will be used to pay for public improvements and fees associated with the development of the Ventanas Business Park on this property. Please contact me to discuss the next steps in the formation of this CFD. Very truly yours, CENTRA RVOILYY CORPORATION a' Sphen P. aSandland Vice President Attachment SS/bd 3 Park Plaza, Suite 1490. Irvine, California 92614. T 949.476.2246. F 949.476.8520 www.centrarealtycorp.com ATTACHMENT 0 0 ,,•. � % till � a 0 0 CONSULTANT SERVICES AGREEMENT THIS AGREEMENT is made and entered into this 19th day of June, 2007, by and between the City of San Juan Capistrano (hereinafter referred to as the "City") and David Taussig & Associates, Inc. (hereinafter referred to as "Consultant"). RECITALS: WHEREAS, City desires to retain special tax consulting services for analyzing Centra Realty's request for a Community Facilities District at their Ventanas Business Center; and, WHEREAS, Consultant is qualified by virtue of experience, skills, training, education and expertise to accomplish such services; and, WHEREAS, The City is a municipal corporation duly organized and validly existing under the laws of the State of California with the power to carry on its business as it is now being conducted under the statutes of the State of California; and, WHEREAS, City has solicited and received a proposal from Consultant, has reviewed the previous experience and evaluated the expertise of Consultant, and desires to retain Consultant to render professional consulting services under the terms and conditions set forth in this Agreement. NOW, THEREFORE, City and Consultant mutually agree as follows: Section 1. Scope of Work. The scope of work to be performed by Consultant shall consist of those tasks as set forth in Exhibit'A," attached and incorporated herein by reference. Consultant warrants that all of its services shall be performed in a competent, professional and satisfactory manner and in accordance with the prevalent standards of its profession. Section 2. Term. This Agreement shall commence on the effective date of this Agreement and services required hereunder shall be completed by no later than September 30, 2007. Section 3. Compensation. 3.1 Amount. City shall pay Consultant upon the submission of required work product Page 1 of 13 ATTACHMENT prepared to the satisfaction of the City for each task as set forth in Exhibit "A" the Scope of Work Total compensation for the scope of services for this Project shall not exceed twenty five thousand dollars ($25,000.00) plus a percentage of Bond issuance for consultation tasks 1 through 11, as set forth in Exhibit "B," attached and incorporated herein by reference. No payments for expenses or labor shall be paid by City unless it is related to this Agreement. 3.2 Rate Schedule. The services shall be billed to the City at the hourly rate set forth in Exhibit "C," attached and incorporated herein by reference. Included within the compensation are the entire Consultant's ordinary office and overhead expenses incurred by it, its agents and employees, including meetings with the City representatives and incidental costs to perform the stipulated services. Submittals shall be in accordance with Consultant's proposal. 3.3 Method of Payment. The City shall pay Consultant upon the completion of services required hereunder and upon submission of invoice by Consultant for tasks which have been satisfactorily completed. For extra work not part of this Agreement, a written authorization from the City is required prior to Consultant undertaking any extra work. 3.4 Records of Expenses. Consultant shall keep complete and accurate records of all expenses incidental to services covered by this Agreement. These records will be made available at reasonable times to City. Section 4. Independent Contractor. It is agreed that Consultant shall act and be an independent contractor and not an agent or employee of City, and shall obtain no rights to any benefits which accrue to City's employees. Section 5. Limitations Upon Subcontractinq and Assignment. The experience, knowledge, capability and reputation of Consultant, its principals and employees were a substantial inducement for City to enter into this Agreement. Consultant shall not contract with any other entity to perform the services required without written approval of the City. This Agreement may not be assigned, voluntarily or by operation of law, without the prior written approval of the City. If Consultant is permitted to subcontract any part Page 2 of 13 0 0 of this Agreement by City, Consultant shall be responsible to City for the acts and omissions of its subcontractor as it is for persons directly employed. Nothing contained in this Agreement shall create any contractual relationships between any subcontractor and City. All persons engaged in the work will be considered employees of Consultant. City will deal directly with and will make all payments to Consultant. Section 6. Changes to Scope of Work. In the event of a change in the Scope of Work provided for in the contract documents as requested by the City, the Parties hereto shall execute an addendum to this Agreement setting forth with particularity all terms of the new agreement, including but not limited to any additional Consultant's fees. Section 7. Familiarity with Work and Construction Site. By executing this Agreement, Consultant warrants that: (1) it has investigated the work to be performed; (2) it understands the facilities, difficulties and restrictions of the work under this Agreement. Should Consultant discover any latent or unknown conditions materially differing from those inherent in the work or as represented by City, it shall immediately inform City of this and shall not proceed with further work under this Agreement until written instructions are received from the City. Section 8. Time of Essence. Time is of the essence in the performance of this Agreement. Section 9. Compliance with Law. Consultant shall comply with all applicable laws, ordinances, codes and regulations of federal, state and local government. Section 10. Conflicts of Interest. Consultant covenants that it presently has no interest and shall not acquire any interest, direct or indirect, which would conflict in any manner or degree with the performance of the services contemplated by this Agreement. No person having such interest shall be employed by or associated with Consultant. Section 11. Copies of Work Product. At the completion of the contract period, Consultant shall have delivered to City at least one (1) copy of any final reports containing Consultant's findings, conclusions, and recommendations with any support documentation. All reports submitted to the City shall be in reproducible format. All services to be rendered hereunder shall be subject to the direction and Page 3 of 13 0 0 approval of the City. Section 12. Ownership of Documents. All reports, information, data and exhibits prepared or assembled by Consultant in connection with the performance of its services pursuant to this Agreement are confidential to the extent permitted by law, and Consultant agrees that they shall not be made available to any individual or organization without prior written consent of the City. All such reports, information, data, and exhibits shall be the property of the City and shall be delivered to the City upon demand without additional costs or expense to the City. The City acknowledges such documents are instruments of Consultant's professional services. Notwithstanding the above, all computer financial models including without limitation compilations of formulas and spreadsheet models used or developed by the Consultant in performing its work are proprietary and shall remain property owned solely by the Consultant. Section 13. Indemnity. Consultant agrees to protect, defend and hold harmless City, its elected and appointed officials and employees from any and all claims, liabilities, expenses or damages of any nature, including attorneys' fees, for injury or death of any person or damage to property or interference with use of property and for errors and omissions committed by Consultant arising out of or in connection with the work, operation or activities of Consultant, its agents, employees and subcontractors in carrying out its obligations under this Agreement. Notwithstanding the above, for purposes of Professional Liability, Consultant shall only indemnify, protect, defend and hold harmless City and any and all of its officials, and employees and agents ("Indemnified Parties") from and against any and all loses, liabilities, damages, costs and expenses, including reasonable attorney's fees and costs to the extent same are caused in whole or in part by any negligent or wrongful act, error or omission of Consultant, its officers, agents, employees or sub consultants (or any entity or individual that Consultant shall bear legal liability thereof) in the performance of professional services under this Agreement. Section 14. Insurance. Insurance required herein shall be provided by Admitted Insurers in good standing with the State of California and having a minimum Best's Guide Rating of A - Class VII or better. 14.1 Comprehensive General Liability. Throughout the term of this Agreement, Consultant shall maintain in full Page 4 of 13 0 0 force and effect Comprehensive General Liability coverage in the following minimum amounts: $500,000 property damage; $500,000 injury to one person/any one occurrence/not limited to contractual period; $1,000,000 injury to more than one person/any one occurrence/not limited to contractual period. 14.2 Comprehensive Automobile Liability. Throughout the term of this Agreement, Consultant shall maintain in full force and effect Comprehensive Automobile Liability coverage, including owned, hired and non -owned vehicles in the following minimum amounts: $500,000 property damage; $500,000 injury to one person/any one occurrence/not limited to contractual period; $1,000,000 injury to more than one person/any one occurrence/not limited to contractual period 14.3 Worker's Compensation. If Consultant intends to employ employees to perform services under this Agreement, Consultant shall obtain and maintain, during the term of this Agreement, Worker's Compensation Employer's Liability Insurance in the statutory amount as required by state law. 14.4 Proof of Insurance Requirements/Endorsement. Prior to beginning any work under this Agreement, Consultant shall submit the insurance certificates, including the deductible or self -retention amount, and an additional insured endorsement to the Consultant's general liability policies to the City's General Counsel for certification that the insurance requirements of this Agreement have been satisfied. 14.5 Errors and Omissions Coverage Throughout the term of this Agreement, Consultant shall maintain Errors and Omissions Coverage (professional liability coverage) in an amount of not less than One Million Dollars ($1,000,000). Prior to beginning any work under this Agreement, Consultant shall submit an insurance certificate to the Clerk of the Board's office for Page 5 of 13 0 0 certification that the insurance requirements of this Agreement have been satisfied. 14.6 Notice of Cancellation/Termination of Insurance. The above policy/policies shall not terminate, nor shall they be cancelled, nor the coverage's reduced, until after thirty (30) days' written notice is given to City, except that ten (10) days' notice shall be given if there is a cancellation due to failure to pay a premium. 14.7 Terms of Compensation. Consultant shall not receive any compensation until all insurance provisions have been satisfied. 14.8 Notice to Proceed. Consultant shall not proceed with any work under this Agreement until the City has issued a written "Notice to Proceed" verifying that Consultant has complied with all insurance requirements of this Agreement. Section 15. Termination. City and Consultant shall have the right to terminate this Agreement without cause by giving thirty (30) days' advance written notice of termination to the other party In addition, this Agreement may be terminated for cause by providing ten (10) days' notice to the other party of a material breach of contract. If the other party does not cure the breach of contract, then the agreement may be terminated subsequent to the ten (10) day cure period. Section 16. Notice. All notices shall be personally delivered or mailed to the below listed addresses, or to such other addresses as may be designated by written notice. These addresses shall be used for delivery of service of process: To City: City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 Attn: Douglas D. Dumhart, Economic Development Manager To Consultant: David Taussig & Associates, Inc. 1301 Dove Street, Suite 600 Newport Beach, California 92660 Attn: Andrea Roess, Senior Vice President Page 6 of 13 Section 17. Attorneys' Fees. If any action at law or in equity is necessary to enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to reasonable attorneys' fees, costs and necessary disbursements in addition to any other relief to which he may be entitled. Section 18. Dispute Resolution. In the event of a dispute arising between the parties regarding performance or interpretation of this Agreement, the dispute shall be resolved by binding arbitration under the auspices of the Judicial Arbitration and Mediation Service ("JAMS"). Section 19. Entire Agreement. This Agreement constitutes the entire understanding and agreement between the parties and supersedes all previous negotiations between them pertaining to the subject matter thereof. ttt FIN ui Fa51 iii va viA Page 7 of 13 0 0 IN WITNESS WHEREOF, the parties hereto have executed this Agreement. City: Sam Allevato, Mayor Attest: Margaret R. Monahan, City Clerk APPROVED TO •John R. Shav�, City Attorney - Page 8 of 13 n L Exhibit A Scope of Work 0 David Taussig & Associates, Inc. shall provide special tax consulting services, as described in the tasks below, necessary to assist the City in the formation of a CFD to fund certain fees and improvements. Task 1. Initial Meeting Attend an initial meeting to discuss the scope of work, proposed schedule, and to identify any other issues prior to beginning work. Task 2. Research Gather the necessary data from the developer (the "Project Developer"), and/or the City with the assistance of DTA. The Project Developer and/or the City are responsible for providing and verifying data describing types of projected development, improved property values, development absorption rates, net taxable acreage, and the estimated cost of the public improvements proposed to be financed. DTA shall rely on such data provided by the City and Project Developer, and shall not be responsible for verifying its accuracy. The City may hire an appraiser or other outside consultants to verify this data. DTA shall also compile assessor's data for the project area. Task 3. Preliminary Tax Spread Prepare initial spread of special taxes (the "Tax Spread") based on land use, building square footage, and/or acreage as obtained through Task 2 above. Calculate special taxes to support proposed financing. DTA may recommend alternative techniques to apportion special taxes to enhance project feasibility. Task 3A. Tax Spreads for Additional Improvement Areas or Zones (OPTIONAL) Should more than one Project Developer participate in the CFD, and should it be necessary to establish separate Improvement Areas or Zones for any of these additional Project Developers, DTA shall prepare Tax Spreads and undertake the activities listed under Task 3 for each additional Improvement Area or Zone. The City and each additional Project Developer shall have the same responsibilities as listed under Task 3. This may require additional fees. Task 4. Rate & Method of Apportionment Prepare the Rate and Method of Apportionment of Special Tax (the "RMA") which describes the methodology used to calculate the annual special tax levy for the CFD. DTA shall work with City staff to modify the RMA as needed. Page 9 of 13 0 10 Task 5. Public Report Prepare the Public Report, as described in Section 53321.5 of the California Government Code, containing descriptions of the proposed public facilities, their estimated costs, projected bonded indebtedness, the anticipated issuance date and maximum annual special tax rates. Task 6. Document Review and Preparation Assist Bond Counsel and Underwriter's Counsel with the preparation of required documents, including the Resolution of Intention, Resolution of Formation, various tables in the Official Statement and related items. Also provide necessary data and advice to Bond Counsel regarding the implementation of the CFD, including policies which address changes in land uses which occur after district formation, parity bonds tests, integration of reimbursement programs from the State or other public districts or fee programs, and the formation of an advisory board to make decisions regarding the issuance of parity bonds and/or the enrollment of special taxes. Task 7. Bond Sizing Assist Underwriter in sizing of bond issue (e.g., use of increasing debt service, capitalized interest, etc.) to establish an optimal schedule of bond sales to maximize funding capacity and generate the greatest possible benefit to all interested parties, as well as to alleviate cash flow constraints. Task 8. Special Tax Consultant Certificate DTA shall prepare and execute a Special Tax Consultant Certificate confirming the adequacy of special taxes to meet debt service requirements for first bond issue. If applicable, DTA shall require an executed landowner information certificate from each Project Landowner confirming net taxable acreage and other relevant data prior to executing the Special Tax Consultant Certificate. Task 9. Verbal Consulting Services Provide verbal consulting services and advice to City and Project Landowner regarding the financing during the period in which Tasks 1 through 8 are being completed. Task 10. Coordination DTA shall attend up to a total of six meetings (not including Task 1). These meetings may be used to discuss or present the Tax Spread, Rate and Method of Apportionment of Special Tax, Public Report, or other items prepared by DTA. They may also be used for the protest hearing, or other public meetings. After a total of six meetings attended by DTA have been completed, additional meetings will require fees beyond the maximum established in the Fee Schedule if the budgeted amount has been completely Page 10 of 13 0 0 expended based on hourly rates quoted herein. Task 11. Preparation of Boundary Map (optional) This task entails the preparation of the CFD boundary map pursuant to the requirements of the Mello -Roos Act and the County Recorder's Office, assuming that computerized base maps are provided by Project Developer. Record map at the County Recorder's office and distribute copy of recorded map to the project team. Page 11 of 13 0 0 Exhibit B Fee Schedule Total compensation (excluding expenses) for completion of Tasks 1 through 10 of the Scope of Work should a Community Facilities District be formed and a first bond issue be sold shall be based on the size of the bond issue, due to the increased liability risk associated with larger bond issues. DTA's proposed budget for Optional Task 11 is $3,500. The total fee to be charged for Tasks 1 through 11 shall be based on the following schedule: First Bond Issue Size Less than $2,000,000 $2,000,000 - $5,000,000 $5,000,001 - $10,000,000 $10,000,001+ Total Fee (excluding Out-of-pocket Expenses) $25,000 $25,000 + 0.0035 of amount over $2,000,000 $35,500 + 0.0025 of amount over $5,000,000 $48,000 + 0.00075 of amount over $10,000,000 Prior to the sale of a first bond issue, DTA shall be remunerated for services based on the hourly rates shown in Exhibit C, with invoices being submitted to City on a monthly basis. Upon the sale of a first bond issue, any remaining portion of the total fee shall be paid from the proceeds of the issue. Should no bonds be sold, DTA shall only receive remuneration for hours worked and out-of-pocket expenses. Should more than one Project Landowner participate in the formation of the CFD, and should one or more of these additional Project Landowners desire to be placed in a separate Improvement Area or Zone from the first Project Landowner, additional time and materials may be charged, up to a maximum of $6,000 per Improvement Area or Zone (Optional Task 3A). Page 12 of 13 0 0 Exhibit C Hourly Rates President $225/Hour Senior Vice President - $210/Hour Vice President - $210/Hour Manager - $180/Hour Senior Associate - $160/Hour Associate - $140/Hour Senior Analyst - $130/Hour Analyst - $120/Hour Research Assistant - $100/Hour Consulting services related to the annual collection of special taxes, or the preparation of certifications or tax spreads for later bond issues, shall be covered under a separate Agreement. Any additional tasks assigned by City if the total fee listed in Exhibit B has been exceeded, shall be charged at the hourly rates listed above. An excessive number of meetings (more than seven including Task 1) or tax spread computer runs (more than fifteen) may also require additional fees if the total fee has been exceeded. Such additional fees shall be added to the 'Total Fee" amounts listed above. The hourly fees listed above apply for a twelve month period after execution of this Agreement, and are subject to a cost -of -living increase after that period and on an annual basis thereafter. In addition to fees for services, City shall reimburse DTA for travel, photocopying, and courier, facsimile, clerical, telephone expenses, and administrative charges, not to exceed $2,000. Page 13 of 13 • 32400 PASEO ADELANTO SAN JUAN CAPISTRANO, CA 92675 (949) 493-1171 (949) 493-1053 FAX www sanjuancapistrano. org IA[AAIAAAffA AAAA AI SAAR 1961 1776 MEMBERS OF THE CITY COUNCIL NOTIFICATION OF MEETING OF POTENTIAL INTEREST OF THE SAN JUAN CAPISTRANO CITY COUNCIL SAM ALLEVATO THOMAS W. HRIBAR MARK NIELSEN JOE SOTO DR. LONDRES USO The City Council of San Juan Capistrano will meet at 7:00 p.m. on June 19, 2007 in the City Council Chamber in City Hall, to consider: "Consideration of Consultant Services Agreement with David Taussig & Associates, Inc., for Special Tax Consulting Services" — Item No. D14. If you have specific thoughts or concerns regarding this item, you are encouraged to participate in this decision making process. You can communicate with the City Council through correspondence addressed to the Council and/or by attending the meeting and speaking to the Council during the public meeting. Correspondence related to this item must be received at the City Clerk's office by 5:00 p.m. on Monday, June 18, 2007 to allow time for the Council to consider its content. If you would like to speak at the meeting, please complete a yellow "Request to Speak" form found inside the entrance to the Council Chamber. This form is turned in at the staff table, just in front of the Council dais. You will be called to speak by the Mayor when the item is considered. You have received this notice at the request of the City staff member Douglas D. Dumhart, Economic Development Manager. You may contact that staff member at (949) 443-6316 with any questions. The agenda, including agenda reports, is available to you on our web site: www.sanivancaaistrano.orp. If you would like to subscribe to receive a notice when agendas are posted to the web site, please make that request by sending an e-mail to: citvclerk(cil sa n iva ncaaistra no.org. Meg Monahan, MMC City Clerk cc: Stephen Sandland, Centra Realty'; Denise Herring, Straddling, Yocca, Carlson & Rauthrr; James Fabian, Fieldman, Rolapp & Associates'; Andrea Roess, David Taussig & Associates'; Peter Piller, DPFP, Inc";; Douglas D. Dumhart, Economic Development Manager Received staff report San Juan Capistrano: Preserving the Past to Enhance the Future 0 Printed on 100% recycled paper 0 0 TRANSMITTAL June 20, 2007 TO: Douglas Dumhart, Economic Development Manager FROM: Meg Monahan, City Clerk SUBJECT: Taussig Agreement As you know the council took the following action last night Consultant services agreement with David Taussig 6 Associates, Inc. for special tax consulting services, in an amount not to exceed $25,000 plus fees based on bonds issued, revised to include language that anything provided by staff is in no way a verification of any approvals, approved; and the Mayor authorized to execute the agreement: Soto/Uso, 5-0 Attached is the original agreement — it has been executed by the Mayor with the understanding the agreed to changes will be made and you will confirm that Taussig is in agreement. Return the revised agreement to our office to be finalized. If Taussig does not agree to the changes, please send a memo to the Council and copy appropriate staff, including me. Thank you, Xajo 00-6,( f L44L,Vl,--