16-0719_NEW TURTLE ISLAND_F13_Correspondence 2 7/19/2016
F13
Date: July 7, 2016
Subject: Opposition to Extending the Personal Services Agreement with New Turtle Island for the City's
Owner Occupied Rehabilitation Loan Program
To: Mayor Pam Patterson, Esq.,
Mayor pro tem Kerry K. Ferguson,
Council Members John M. Perry, Derek Reeve and Sam Allevato,
Ben Siegel, City Manager
Joel Rojas, Development Services Director
I am a citizen of San Juan Capistrano and I am also a user of the Owner Occupied Rehabilitation
Loan Program. I am extremely opposed to the approval of any extension or continuation of the
Personal Services Agreement with New Turtle Island ("NTI")for its administration of the City's Owner
Occupied Rehabilitation Loan Program. Based upon my personal first-hand experience with NTI,the
approval by the City Council to extend the Personal Service Agreement with NTI would not be in the
best interest of the taxpaying citizens of San Juan Capistrano. Based upon my interactions with NTI for
over the last six months, I have concluded that the performance of NTI is less than adequate. NTI's
operations are incompetent and deficient, and as the result of NTI's failures to abide to the terms of it's
agreement,the City Council should deny the Second Amendment to the Personal Services Agreement
with New Turtle Island.
The proposal to execute and approve a Second Amendment to the Personal Service Agreement
with NTI was listed as item#14 on the consent calendar for the June 21, 2016 City Council meeting. The
proposed agreement was removed from the calendar and is now intended to be reintroduced and
included during the City Council meeting scheduled for July 19, 2016.
My opposition to extension and continuation of the Personal Services Agreement with New
Turtle Island is two-fold. First, NTI administration of the Owner Occupied Rehabilitation Loan Program
has been substandard and has not met the expectation of the original agreement first approved in
2012. Second, and more importantly, I have had horrendous problems with NTI concerning its
oversight of my Occupied Rehabilitation Loan. I do not believe any rational review of the work
performed by NTI should be considered as excellent. Rather,as I will explain below,the work of NTI
should be considered deficient and inferior to the expectations of a well run and proficiently managed
program that puts the best interest of the citizens of this city as a priority.
Failure to Meet the Expectations of the Original Agreement of July.17, 2012
On April 7, 2015, the City Council approved and adopted a First Amendment to the Personal
Services Agreement with New Turtle Island for the administration of the City's Owner Occupied
Rehabilitation Loan Program which extended to agreement until June 30, 2016. The original agreement
adopted on July 17, 2012 was to cover a period of 3 years and included provisions for NTI to market the
loan program as necessary to meet program performance measures and reach all demographics within
the City of San Juan Capistrano. Between July 2012 and June 2015, NTI had approved 29 loans.
However, per the staff report submitted to the City Council under item#13 on the consent calendar on
April 7, 2015, city staff expected that between April 1, 2015 and June 30, 2016, approximately 21
additional loans would be generated under the loan program administered by NTI. Contrary to
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expected 21 new loans, the staff report for the June 21, 2016 City Council meeting provides only 31
loans have been provided since 2012. By simple mathematic deduction, it would appear based upon
the information provided by the city staff,that NTI has only generated two loans between the April 7,
2015 staff report(consent calendar item#13)and the June 21, 2016 staff report(consent calendar
item#14). 1 don't know how anyone could consider this to be an efficient and effective marketing
program that would meet performance standards of 21 new loans as described in the staff report of
April 7, 2015.
Also,the staff report of June 21, 2016 explains that currently that due to unexpected delays in a
couple of Owner Occupied Rehabilitation loans,the City has not completed as many loans as expected.
This issue of unexpected delays,to a certain extent, are due to ineffective and deficient work of NTI. I
know this because I deem myself to be one of the unexpected delays in the loan project. As I will
explain in more detail below, NTI has incompetently administered the oversight of my loan and such
unsatisfactorily performance should not be rewarded.
I do not consider the lack of productively,the failure to aggressively market and generate new
loans, and to shoddily complete loans in progress to be excellent work, rather, as I will further explain,
the work by NTI has been deficient and has failed to fulfill the standards of work as contained in its
agreement with the City of San Juan Capistrano.
Deficiencies and Failure to Fulfill the Standards of Work as Cited_in-the Agreement
On November 6, 2015 1 entered into a contract under the City's Owner Occupied Rehabilitation
Loan Program. This loan was administered by New Turtle Island under the oversight of Patrick Piatt,
Owner of NTI. To put it bluntly, the project has been a nightmare.
The project was to be completed within 30 days of commencement,with a projected final
completed date of December 9, 2015. The project was never completed and finally April 15, 2016, after
numerous problems with inferior workmanship, improper materials, roof leaks,and the failure by the
contractor to fulfill the standards of work as required under the City of San Juan Capistrano Owner
Occupied Rehabilitation Loan Program, I informed the contractor(Govea Co.)that I no longer wanted
him or his employees on my property. This was after the state inspectors from the California
Department of Housing and Community Development("HCD"), Divisions of Codes and Standards, during
an April 12, 2016 re-inspection of the work completed by the contractor,failed to pass the work
performed by the contractor.
While much of the blame can be placed upon the contractor, Govea Co.,the incompetent
oversight and failures of NTI have resulted in my problem. While there have been numerous
deficiencies by NTI,to keep it short, I will cite only some of the most egregious and obvious failure by
NTI.
• Under its agreement with the City, under the bid process section (page 7 of NTI bid, under
Attachment 2,to the July 17, 2012 staff report), NTI is supposed to hold a job walk for
projects at the site and to hold a discussion about the project and to hold a pre-
construction meeting with the Owner and Contractor at the property. NTI failed to
perform or be present at the a job walk, and I had to meet with the contractors by myself
and try to answer questions that I was not trained or qualified to do.
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• During the bid process, one of the contractors who came to my residence, when NTI was not
even there for a job walk,was not included in the bids provided to me by NTI. I have since
found out that contractor has stopped bidding on the SJC Owner Occupied Rehabilitation
Loan Program due to the bids not being accepted for reasons, including as being too high. I
completely understand the wise and prudent spending of tax dollars, but the old adage of
"you get what you pay for" and "the cheapest is not always the best" is very relevant to my
problems. I only went with the contractor, who was cited by NTI as being very good,since I
had faith the city's loan program would be held to the highest standards. I have since
determined I would never accept any recommendations or advice by NTI, and I feel that the
costs should be at the discretion of the home owner who will eventually pay back the loan.
Neither NTI, nor any other program administrator should ever advise on the ability of the
contractors, unless the administrator is going to stand behind the workmanship of the
contractor. Although NTI has continuously advised that there has never been a problem
with the contractor on my project, I now am stuck with a shoddy and dishonest contractor.
• NTI under its agreement is to properly prepare and execute all documents and have such
documents properly notarized. NTI failed to properly process the executing my loan
documents. 1 was told by Mr. Piatt/NTI on October 23, 2015, at my residence to sign my
documents, and leave the date line blank. NTI did not prepare the proper documents and
have me re-sign them until Dec 4th -28 days into the project. In March of 2016(5 months
later)when I requested copies of my documents from NTI (which I had never received)to
file a complaint with CSLB,the documents I had signed Dec 4th were nowhere to be found,
and the documents I had signed in October,were dated by NTI and attached to the new
revised documents. I do not believe this is legal, or a professional way to handle the City's
Grant Loans.Also NTI added comments to the documents after I had signed them,which I
also deem to be prohibited. -NTI more than once requested that I sign documents and leave
dates line not filled in so NTI would not have to come back to my residence.
NTI under its agreement is to monitor the construction and provide conflict resolution. Mr.
Platt/NTI failed to properly monitor my project and completely failed to perform
satisfactory conflict resolution.
A. There are delays in the contractor starting work and contractor fails to level mobile
home before installing new aluminum roof. Numerous problems include-roof and rain
gutters leak;contractor improperly installs new roof over kitchen vent; contractor orders
wrong materials, including ordering non- Energy Star widows as specifically required in the
contract; contractor damages mobile home when loading roofing materials. I sent
numerous emalls to Mr. Platt/NTI,who fails to promptly respond.
B. On November 28, 2015, Mr. Piatt/NTI comes to my residence for the first time in
regards to my complaints and he states he will pass the non-Energy Star windows. The
contractor,upon my inquiry when I did not see a Energy Star marking told me they were
Energy Star, it was only after I called the manufacturer did I determine that the contractor
had provided false and dishonest information. I requested to Mr. Platt to have the
contractor removed and retain a different contractor to complete the project. Mr.
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Piatt/NTI failed to do so and is putting the interest of the contractor,and its own
compensation before the taxpaying citizen of San Juan Capistrano.
C. After having an awful smell in my mobile home, I determined that the contractor had
covered a plumbing vent in the kitchen when installing the new roof. The contractor
originally said the smell in my kitchen had nothing to do with his work. I was lucky that I
had taken 'before' pictures of the roof to prove there was a vent there. Finally after making
verbal complaints, I officially emailed the contractor and Mr. Piatt/NTI on December 3 and
it took until December 9 to fix the problem. I had to contact the City's Building and Safety
Department on December 7 after the smell was making me sick. Not only did NTI fail to
promptly have the deficient work fixed,NTI did not have adequate before and after
pictures as per its agreement(see page 6 under the Inspection/Work Write-Up Section of
Attachment two of original bid submitted per July 7,2012 city staff report).
D. On December 4, after experiencing further leaks,the ordering of an improper sky light,
issues with the roof being installed before a bathroom fan, creating a construction problem,
Mr. Piatt/NTI returns to my residence. Even with all these issues, Mr. Piatt wants me to
sign a Pay Authorization for portions of the project, even though they are incomplete or
fail to meet good workmanship standards. 1 refuse to sign,even after Mr. Piatt states I can
sign it undated and the bills won't be paid until the work is corrected. I am glad I did not
take Mr. Platt's deficient advice.
E. Also on December 4, Mr. Piatt/Ms. Herzog/NTI had me sign an extension.The original
copy of the contract I signed on October 23, 2015, had a final completion date of November
30, 2015 listed in the contract.The contract dated November 6, 2015,which I did not sign,
had a final completion date of December 9, 2015. 1 did not want to sign the extension and
explained why-I was NOT the reason for the stop work,Govea,the contractor was. I was
coerced and was told I had to sign it because I was going on vacation. My vacation was only
Dec 10—Dec 20th, 10 days. The real reason for NOT starting back up until Jan 4th was
because the contractor did not have materials and it was going to take 20 days for materials
to arrive, per the contractor. I was upset Ms. Herzog was having me sign an extension for
the contractor not having the materials even ordered, nearly 30 days after the last final
completion date. I wrote my comments on the change order worksheet and signed and
dated 12/4 with my comments. The back page of the contract I signed on Oct. 23 was
attached to the new, re-written contract. Is this how the city program is being run? I was
FINALLY mailed a copy of the pieced together contract on March 31,2016,which has
discrepancies as to the proper dates.And the change order I signed with my comments on
it,were stated not to be found. The agreement states the loan documents are to be
notarized,and I feel the contract is part of the loan documents,another failure of lack of
proper attention by NTI.
F. Throughout the whole process with the substandard work by the contractor,only Mr.
Piatt actually performed any review of the work performed by the contractor.Yet,when I
read the City's agreement with NTI, Mr. Piatt does not list his qualifications as being that of
a building inspectors or having specific knowledge in local building codes. In the
Agreement, NTI does list two individuals who would be considered as having knowledge in
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building codes,yet these two individuals never came and looked at my complaints of
shoddy and inferior workmanship. Does the City Council know that problems with
workmanship and work failing to meet code are not being inspected by NTI by the
individuals listed in the agreement as meeting these specific qualifications and skills?
These individuals were specifically listed as being assigned to the City of San Juan
Capistrano.
G. I had problems with the installation of a skylight throughout the project, and even after
numerous complaints to NTI, I was told the skylight was proper and installed within the
building code guidelines. I had to call HCD to advise them of the failure to install the
skylight within manufacturer guidelines and it was during their more comprehensive re-
inspection of April 12, 2016,that the work of the contactor failed to pass the building
inspection. Although I had repetitively informed Mr. Platt/NTI of my concerns, it took my
own work and initiative to be able to document the problems that NTI should have
completed and had knowledge of according to their scope of work and cited experience
and bid to obtain the original Service Agreement in 2012.
• On February 15, 2016, Mr. Piatt/NTI shows-up unscheduled at my residence. Even though it is
way past even the expended final completion date of February 4, 2016,the contractor has
failed to even start many of the items listed in my contract, including the pigtailing of
electrical outlets,the installation of windows and a sliding door, leveling of the mobile
home, installing a new vent fan in the guest bath,and other listed items in the contract.
It was the First time NTI had been out since December 4, 2015. It was then very clear to
everyone that the contractor was not going to be able to complete the project to the
workmanship standards as required and defined under Item#9 of my contract. That is
"compliance with the work write-up and all applicable building codes and regulations with
regard to material, methods and assembly will not, in itself,assure acceptance of the
construction. Of equal im ortance is good and sound workmansho, the Jack of which shall
be sufflcr"ent cause to refuse acceptance of the construction," (emphasis added). Not only
had the contractor failed to the work write up and building code elements,the contractor
had also clearly failed to provide good and sound workmanship. Finally, after nearly 5
months of agony, I was agreeable to ending the contract with the contractor and paying a
reduced sum for the limited work the contractor had completed. During the February 15
meeting,the contractor, NTI and I made a verbal agreement to end the contract and I
would pay the contractor$4,500 and have a ten year warranty on the workmanship. The
contractor had only installed a roof, rain gutter and a new skylight, all of which I had
problems with. Unfortunately, on February 22, 1 received a revised contract written by NTI
that was not to what was verbally agreed to on February 15. On March 1, 1 submit my
proposed settlement offer to NTI,and NTI took no further action, only forwarding it to the
contractor. Again,Mr. Piatt/NTI demonstrated a lack of interest to the citizen of San Juan
Capistrano and provided more advantageous attention to the contractor. On March 12,
20161 experience another leak in my roof creating damage to my inside ceiling. Mr.
Platt/NTI does nothing more to resolve my complaints with the contractor..
• On or about March 21, 2016, 1 receive a phone call from the contractor advising I have until the
end of the day to sign an arbitration agreement going into private arbitration at great
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expense to me. Upon my review of the contract, I determine that I should have rights to go
to the California State License Board (CSLB)which offer arbitration for free to the public.
On March 23, 2016, 1 receive an email from Mr. Piatt/NTI stating I do not qualify for CSLB
arbitration. Upon my(and my brother's research), it is determined that Mr. Platt was
quoting the wrong CSLB arbitration process, and that I should quality for the for CSLB
arbitration. I have since filed a complaint with the CSLB and the complaint is now under
investigation. Not only was Mr. Piatt/NTI deficient in the understanding of the CLSB
regulations, NTI was incompetent to the legal requirements of the laws of California. The
City of San Juan Capistrano Owner Occupied Rehabilitation Loan Program contract was
determined to be deficient and not in compliance with California state law. Under Article
12 of Chapter 9 of the Business and Professions Code,the contract entitled "City of San Juan
Capistrano Owner Occupied Rehabilitation Loan Program" did not contain the language as
required under Section 7191(b). Under Section 7191(c),the language of the written
contract did not comply with the prohibitions of Section 7191 and therefore the arbitration
clause is not enforceable in the City contract. NTI under its agreement is supposed to be
knowledgeable of the laws of California in regards to the building codes and laws. Not only
was NTI unaware of the law, NTI provided false and incompetent information. It should
not be the responsibility of the citizens of San Juan Capistrano to research the law,it
should be the responsibility of NTI,who is being paid to have the knowledge and
expertise to know the rules. The City's legal department has since acknowledged the
language of the contract for the City of San Juan Capistrano Owner Occupied
Rehabilitation Loan Program needs to be updated.
In closing, I assert that the Personal Services Agreement with New Turtle Island should not be renewed
or amended. NTI has failed on many aspects to provide professional and knowledgably oversight of the
Owner Occupied Rehabilitation Loan Program. Rather than proficiently assisting citizen of San Juan
Capistrano, it has acted in a deficient manner. Having first-hand knowledge of capabilities of NTI, I
implore the City Council to find a better qualified and proficient administrator who will look out for the
best interest of the citizen.
I just became aware of proposed changes to the oversight of the Owner Occupied Rehabilitation Loan
Program. Unfortunately I need to travel on an urgent family matter and may be gone for several days. I
will not have an opportunity to adequately address all of the proposed changes in the Owner Occupied
Rehabilitation Loan Program prior to the next scheduled City Council meeting on July 19,2016.
Therefore, I would request any action on this issue of proposed changes to the oversight of the Owner
Occupied Rehabilitation Loan Program be postponed until the next scheduled meeting of the city
Council on August 2, 2016. The fact that the Development Services Department has seen a need to
address some very relevant issues only confirms my concerns. Also,since l have not had a chance to
thoroughly review all the proposed changes, my preliminary response would be that these changes are
needed, but in my first reading it would appear the safeguards of item#9 of the contract dealing with
good and sound workmanship may be being deleted,which would be wrong.
Again, I assert that New Turtle Island should,not be given an extension or amendment to its personal
service agreement due to inferior and deficient work clearly demonstrated in my rehabilitation program
loan. Due to the lack of proper oversight by NTI, I am now in no man's land. I do not have faith in the
ability of the contractor to complete the job to specifications and with good and sound workmanship,
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and I cannot according to Development Services,get a new contractor to start and complete the
projects items that the original contractor never even started after five months on the job.
Sincerely,
Patricia Nigg
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