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Current Council Agenda and Past Meeting Information

CITY COUNCIL AGENDA ITEM NO. 13

Meeting Date: October 9, 2007

Subject/Title: Adopt a Resolution approving and authorizing the City Manager or designee to execute a second amendment to the Lease agreement with the Contra Costa Community College District pertaining to Los Medanos College located at the Brentwood Education and Technology Center and authorizing the City Manager or designee to agree to non-substantive changes to the agreement following a review of such changes by the Community Development and Finance Directors in consultation with the City Attorney

Prepared by: Jim Malberg, Assistant Director of Finance & Information Systems

Submitted by: Pamela Ehler, Director of Finance & Information Systems

RECOMMENDATION
Adopt a Resolution approving and authorizing the City Manager or designee to execute a second amendment to the Lease agreement with the Contra Costa Community College District pertaining to Los Medanos College located at the Brentwood Education and Technology Center and authorizing the City Manager to agree to non-substantive changes to the agreement following a review of such changes by the Community Development and Finance Directors in consultation with the City Attorney.

PREVIOUS ACTION
On September 14, 1999, City Council approved Resolution No. 99-147, authorizing the purchase and sale of property at 101 Sand Creek Road in an amount not to exceed $1.35 million, CIP Project No. 336-3112.

On June 27, 2000, City Council authorized the City Manager to execute a lease with the Contra Costa Community College District for the Brentwood Education and Technology Center.

On September 4, 2001, Los Medanos College opened in Brentwood

On December 19, 2001, the parties executed the lease agreement between the City of Brentwood and the Contra Costa Community College District to lease 17,000 square feet at the Brentwood Education and Technology Center.

On March 20, 2002, City Council approved Amendment No. 1 to the lease between the City of Brentwood and Contra Costa Community College District. This amended the parking and janitorial services for Los Medanos College.

BACKGROUND
The agreement between the Contra Costa Community College District (CCCCD) and the City of Brentwood, authorized by the City Council in June of 2000, provided the City with the ability to lease approximately 17,000 square feet of space at the Brentwood Education and Technology Center to CCCCD. Additionally, the City Council authorized an amendment to the agreement with CCCCD in March of 2002 to resolve matters related to the on-going parking and janitorial services for Los Medanos College (LMC).

At the time the original lease agreement was executed in 2001, it was anticipated that enrollment at LMC would slowly grow to 500 full-time equivalent students. That was a very conservative estimate and in fact enrollment reached 500 students during the first year that LMC was opened. Currently there is an opportunity for the City to lease and LMC to convert an additional 1,830 square feet of space into 3 classrooms to better serve their students.

The purpose of the proposed amendment is to establish the parameters under which the additional 1,830 square feet of space will be leased by the City to CCCCD. More specifically, the original lease of 17,000 square feet of space was based on full-time student enrollment and included utilities, whereas the lease of the additional 1,830 square feet of space will be on a rent per square foot amount to be established annually by the City Council with the approval and adoption of the Cost Allocation Plan and Fee Schedule. LMC will pay the City for their pro-rated share of utility cost for the additional leased space. Provisions have been added to address tenant improvements as well as adding a relocation waiver. The remainder of the agreement is unchanged from the previous version approved by Council.

At the time this staff report was prepared, the CCCCD legal counsel had not completed their review of the agreement. The resolution authorizes the City Manager or designee to agree to non-substantive changes to the agreement. If there are any substantive changes to the agreement, as determined by the Community Development and Finance Directors in consultation with the City Attorney, the agreement will be brought back before Council for further consideration.

FISCAL IMPACT
The City Council approved monthly rental rate for office space during the 2007/2008 fiscal year is $3.71 per square foot. This equates to a monthly lease amount from CCCCD to the City of $6,789.30 for an annual amount of $81,471.60. In addition, the pro-rated utility cost, which is based on the actual 2006/2007 cost per square foot, is $325 per month ($3,900 annually) which CCCCD will pay to the City with their lease payment. The monthly square footage rental rate will be adjusted annually based on the City Council approved Cost Allocation Plan and Fee Schedule which is tied to the Consumer Price Index for the San Francisco Bay Area. In addition, the utility cost will be adjusted annually based on the actual utility cost per square foot of the preceding fiscal year. The original agreement calls for CCCCD to make semi-annual lease payments on January 15th and July 15th of each calendar year.

Attachments:
Resolution
Second Amendment

RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BRENTWOOD APPROVING AND AUTHORIZING THE CITY MANAGER OR DESIGNEE TO EXECUTE A SECOND AMENDMENT TO THE AGREEMENT WITH THE CONTRA COSTA COMMUNITY COLLEGE DISTRICT PERTAINING TO LOS MEDANOS COLLEGE LOCATED AT THE BRENTWOOD EDUCATION AND TECHNOLOGY CENTER AND AUTHORIZING THE CITY MANAGER OR DESIGNEE TO AGREE TO NON-SUBSTANATIVE CHANGES TO THE AGREEMENT FOLLOWING A REVIEW OF SUCH CHANGES BY THE COMMUNITY DEVELOPMENT AND FINANCE DIRECTORS IN CONSULTATION WITH THE CITY ATTORNEY

WHEREAS, on September 14, 1999, City Council approved Resolution No. 99-147, authorizing the purchase and sale of property at 101 Sand Creek Road in an amount not to exceed $1.35 million, CIP Project No. 336-3112.; and

WHEREAS, on June 27, 2000, City Council authorized the City Manager to execute a lease with the Contra Costa Community College District for the Brentwood Education and Technology Center; and

WHEREAS, on December 19, 2001, the lease agreement between the City of Brentwood and the Contra Costa Community College District was executed whereby the City leased to Contra Costa Community College District 17,000 square feet at the Brentwood Education and Technology Center; and

WHEREAS, on March 20, 2002, City Council approved Amendment No. 1 to the lease between the City of Brentwood and Contra Costa Community College District amending the parking and janitorial services for Los Medanos College; and

WHEREAS, the parties desire to amend the agreement to increase Contra Costa Community College District’s total leased area.

NOW, THEREFORE BE IT RESOLVED that the City Council of the City of Brentwood does hereby:
1. Approve and authorize the City Manager or designee to execute a second amendment to the agreement with the Contra Costa Community College District pertaining to Los Medanos College located at the Brentwood Education and Technology Center in the form attached hereto, subject to revisions made pursuant to item 2 below; and
2. Authorize the City Manager or designee to agree to non-substantive changes to the agreement following a review of such changes by the Community Development and Finance Directors in consultation with the City Attorney.

PASSED, APPROVED AND ADOPTED by the City Council of the City of Brentwood at a regular meeting held on the 9th day of October 2007 by the following vote:

SECOND AMENDMENT TO LEASE
BRENTWOOD EDUCATION AND BUSINESS CENTER

This Second Amendment to Lease – Brentwood Education and Business Center (the “Second Amendment”) is entered into as of , 2007 (the “Effective Date”), by and between the City of Brentwood, a municipal corporation (“Landlord”) and Contra Costa Community College District, a public community college district established under the laws of the State of California (“Tenant”).

Recitals

A. Landlord and Tenant entered into that certain Lease – Brentwood Education and Business Center, dated December 19, 2001, for the Tenant’s lease of certain Landlord-owned property defined as the Demised Premises, and that certain Amendment No. 1 to Lease dated March 20, 2002, to address parking and janitorial services (collectively, the “Lease”). Any capitalized term not defined herein shall have the definition set forth in the Lease.

B. The parties desire to amend the Lease to (1) provide for the lease of an additional 1,830 square feet of property located adjacent to the Demised Premises and depicted on Exhibit A-2 attached hereto (the “Additional Demised Premises”); (2) provide for the Tenant’s work on the Additional Demised Premises; and (3) add a relocation waiver in favor of City. The Demised Premises and the Additional Demised Premises may hereinafter be collectively referred to as the “Leased Premises.”

Terms

NOW, THEREFORE, in consideration of the foregoing recitals and for other good and valuable consideration, the parties agree as follows:

1. Effective Date. This Second Amendment shall be effective as of the Effective Date.

2. Amendment of Section 2.

2.1. Section 2 of the Lease is hereby renumbered and retitled “2.1. Rental of the Demised Premises.”

2.2. The following sentence is added to the beginning of Section 2.1 of the Lease, as modified above:

“This Section 2.1 pertains only to the payment for rental of the Demised Premises, and does not address the payment for rental of the Additional Demised Premises, which is addressed in Section 2.2.”

2.3. Section 2.2 is hereby added to the Lease as follows:

“2.2. Rental of the Additional Demised Premises. Tenant and Landlord agree that Tenant shall lease the Additional Demises Premises from the Landlord for a monthly rental payment of $6,789.30 per month, plus an additional $325.00 for utilities (the “Additional Demised Premises Rent”). The Additional Demised Premises Rent shall be paid semi-annually on January 15 and July 15 of each year. The Additional Demised Premises Rent shall be adjusted annually based on the City’s Cost Allocation Plan. The rental rate shall be tied to the Consumer Price Index for the San Francisco Bay Area and the utilities charge shall be based on the Tenant’s proportionate share of the actual cost of utilities.”

2.4 Section 2(d) on Definition of Rent is hereby deleted in its entirety.

2.5 Section 2.3 is hereby added to the Lease as follows:

“2.3 Definition of Rent. Any and all payments of Minimum Yearly Rent or Base Rent and Additional Demised Premises Rent shall constitute “Rent” for purposes of this Lease. Any Rent payable to Landlord by Tenant for any fractional year shall be prorated based on a 365-day year. Any and all Rent payments shall commence on the Rent Commencement Date.”

3. Addition of Language to Section 3. The following language is added to the end of Section 3:

“Possession of the Additional Demised Premises shall be on November 1, 2007.”

4. Amendment of Section 4.

4.1. Section 4 of the Lease is hereby renumbered and retitled “4.1. Demised Premises Construction Work.”

4.2. Section 4.2 is hereby added to the Lease as follows:

“4.2. Additional Demised Premises Construction Work. Landlord shall deliver the Additional Demised Premises vacant and in “broom clean” condition and otherwise “as-is” condition. Tenant shall immediately commence the work described in Exhibit E-2, and no other work, and diligently pursue work to completion. At expiration or termination of this Lease, Tenant agrees to remove at Tenant’s expense, Tenant’s fixtures and those interior and other improvements made by Tenant which Landlord which designates in writing not less than 30 days prior to such expiration that Tenant shall be required to remove, and shall otherwise return the Additional Demised Premises to Landlord in good condition, ordinary wear and tear, damage by casualty, condemnation act of god and/or failure to make repairs by Landlord excepted. Notwithstanding any provision of this Lease to the contrary, in no event shall Tenant be required to remove any improvements and/or alterations which are incorporated into the building structure and/or enclosed in any exterior or interior wall of the Additional Demised Premises, Landlord shall be permitted to post Notices of Non-Responsibility in connection with completion of Tenant’s work by Tenant’s contractor and subcontractors at the Additional Demised Premises.”

5. Replacement of Term “Demised Premises” and “Premises” with “Leased Premises.” In Sections 5 through 36 of the Lease, the terms “Demised Premises” and “Premises” shall be replaced with the term “Leased Premises,” in order to ensure that the lease provisions incorporate the Additional Demised Premises.

6. Addition of Section 37 regarding Relocation Waiver. Section 37 is hereby added to the Lease as follows:

"37. Relocation Waiver. Tenant hereby waives and releases Landlord and its and their officers, employees, agents and representatives, harmless from, any claims, demands, damages, defense costs or liability that may be asserted by Tenant or any person or business residing or located upon the Leased Premises for relocation benefits or assistance, replacement dwelling(s) or any other compensation of any nature whatsoever available or alleged to be available under any Federal, State or local law, regulation or ordinance, including the California Relocation Assistance Act of 1970, as amended (California Government Code § 7260 et seq.), the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended (42 U.S.C. § 4601 et seq.), and implementing State and Federal regulations.”

7. Lease in Full Force and Effect. Except as amended by this Second Amendment, the Lease remains in full force and effect.

Tenant:

Contra Costa Community College District, a public community college district established under the laws of the State of California

By:
Printed Name:
Title:

Date:

By:
Printed Name:
Title:

Date:

Landlord:

City of Brentwood, a municipal corporation


By:
Donna Landeros, City Manager

Date:

ATTEST:


By:
Margaret Wimberly, City Clerk


APPROVED AS TO FORM:


By:
Damien B. Brower, City Attorney


Exhibit A-2

Depiction of Additional Demised Premises

Exhibit E-2

Description of Tenant’s Work on Additional Demised Premises

 

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Brentwood, CA 94513
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E-mail allcouncil@brentwoodca.gov