HomeMy WebLinkAbout05/07/1990 BAKERSFIELD
Kevin McDermott, Chair
Patricia DeMond
Ken Peterson
Staff: John Stinson
AGENDA
BUDGET AND FINANCE COMMITTEE
Monday, May 7, 1990
12:00 noon
City Manager's Conference Room
1. City Physician :
2. Garone (refund request)
3. Management and Internal Control Report from KPMG Peat
Marwick
4. CDBG Application Update
5. Proposed Ordinance regarding Liability Insurance
Requirements for Certificate Holders for Ambulance
Businesses.
6. Selection of Health Care Consultant
7.. Schedule Committee Review of 1990-91 Budget
CITY COUNCIL REFERRAL
MEETING OF: 06/14/89
REFERRED TO: BUDGET & FINANCE J W STINSON
ITEM: RECORD~ 2908
Communication from Gary Garone, 1001 East Hoskins
Road, dated May 31, 1989, regarding leasehold
interest in City acreage.
ACTION TAKEN BY COUNCIL:
RECEIVE AND REFER TO BUDGET AND FINANCE
COMMITTEE. APPROVED AA.
BACKUP MATERIAL ATTACHED: YES
DATE FORWARDED BY CITY CLERK: 06/16/89
STATUS:
PLEASE ENTER THE STATUS INTO THE PRIME COMPUTER
COUNCIL REFERRAL TRACKING SYSTEM AS PROGRESS tS MADE.
GARY GARONE FARMS
1001 EAST HOSKINS ROAD
BAKERSFIELD, CA 93307
[[~ (805) 831-2127
May 31, 1989
Mr. Dale Hawley
Sity Manager J~N 05 ~g~ '
1501 Truxtun Avenue
Bakersfield, CA 93301 Gi~ANA~E~'SOFFIOE
Dear Mr. Hawley,
On June 17, 1987 the City of Bakersfield and I, Gary Garone,
executed Agreement #87-140 (Agreement to Lease ~78-165) wherein I
released the use and interest in 40 acres of leased farmland to
the City. I was then to be given a leasehold interest in 144
acres the City was to acquire not later than September 1, 1987.
Since the execution of this Agreement the City has acquired
the 144 acres. The City was then going to upgrade this new land
to conform with the rest of the farm by installing new irrigation
pipelines and regrading of the land. .Upon completion of this
work, I was to be given access to the property for my farming
operation° As of this date, this work is still to be completed.
The City and I have both suffered'economic loss due to the
greatly delayed completion of this project. The City had the
potential of increased rental income and I have lost the use of
this land to farm. In my case,. I am losing the use of. the 40
acres for two and one half years and the 144 acres for two years.
Based on the Agriculture Soil Conservation Service
measurements, the farm contains 4431 farmable acres. As you
know, I presently pay the city a minimum of $200,000 annually.
This averages $45.14 per acre annual rent. Therefore, taking
into account the time and acreage lost, I am requesting that my
minimum annual rent for 1989, which is due December 31, 1989, be
reduced by $17,531.32. In addition to this, I am requesting a
further reduction of $14,400.00 for loss of crop income on that
144 acres for two years. The total amount of reduction herein
requested is $31,931.32.
I am free at anytime to further discuss this matter and if
you have any questions please contact me.
Respectfully,
GG:rj
CC: Ed Schulz
MEMORANDUM
TO: E.W. SCHULZ, PUBLIC ~DRKS DIRECTOR
FROM: DEWAYNE STARNES, CIVIL ENGINEER III
DATE: JUNE 13, 1989
SUBJECT: 140 ACRE FARMLAND - k%STEWATER TREATMENT PLANT
Plans and Specifications for irrigation of the 140 acre parcel
were completed in May of 1988. Mr. Garone had expressed his concern about
construction during the summer months and said he could not shut down the
water supply even for a day or two. The project was postponed with plans
specifications approved August 8, 1988 and bid opening September 29, 1988.
I was then notified by Mr. Garone that the land would need to be leveled.
In an attempt to level the land laser perfections was hired to survey the
parcel. Prior to surveying, Mr. Garone was contacted and paid to disc the
parcel 3 times in order to cut down the weeds.
Since the laser perfections indicated that leveling the parcel
would cost around $25,000, this eliminated the possibility of informal bid.
The ideal situation would have been to level the land prior to constructing
the irrigation system, however, this did not occur. Construction of the
irrigation line took longer than anticipated and the Contractor was not
finished with work until January/February 1989. Bid opening for the land-
leveling was January 16, 1989 and awarded to Odis Dykes on January 18, 1989.
Odis Dykes had bonding difficulties and could not meet the contract require-
ments and indicated this to us on March 20, 1989. The contract was recinded
from Odis Dykes and awarded to the next lowest bidder Turman Construction Co.
on April 12, 1988. Work on landleveling began in May of 1989 and is approxi-
mately 50% complete as of this date.
DS/lh
4 :M-061389
AGREEMENT NO. 78-165
MUNICIPAL FARM LEASE AGREEMENT
THIS LEASE is made and entered into this 20th day of
December, 1918, by and between the CITY OF BAKERSFIELD, a municipal
corporationl hereinafter referred to as Lessor, and GARONE CATTLE
COMPANY, hereinafter referred to as Lessee:
I
PURPOSE OF LEASE AND DESCRIPTION OF LAND
(a) Lessor hereby leases the below-described property to
Lessee, and Lessee hires same from Lessor, for the purpose of
conducting thereon a farming and ranching operation for growing
agricultural crops and related usage and for the purpose of spread-
ing reclaimed water for further land treatment and beneficial
irrigation use. Said property leased to Lessee is that certain
premises known as the Bakersfield Municipal Farm, situated in the
County of Kern and more particularly described as shown on Exhibit
"A" attached hereto and by this reference made a part hereof,
excepting the following lands which shall become a part of this
lease no earlier than July 1, 1979 and no later than October 30,
1979, depending upon completion and acceptance by Lessor of con-
struction work on said lands:
(1) All of that portion of Section 11, T30S, R28E,
M.D.M., as shown on Exhibit "B" attached hereto and by this
reference made a part hereof.
(2) The E 1/2 of Section 9, T31S, R28E, M.D.M.
(3) The W 1/2 of Section 15 and the SE 1/4 of
Section 15 all in T31S, R28E, M.D.M.
(4) SW 1/4 of Section 23, T31S, R28E, M.D.M.
(b) Lessee hereby agrees that the portion of the leased
premises lying within Section 4, T31S, R28E and the west one-halfl
of Section 9, T31S, R28E, shall be restricted to uses and no use
shall be permitted thereon without first having obtained the
approval of the Lessor. No land leveling will be permitted on such
premises without prior ·authorization from Lessor.
II
TERM OF LEASE
The term.shall be for seven (7) years, commencing on the
first day of January, 1979, and ending on the 31st day of December,
1985, unless sooner terminated in accordance with this agreement.
The Lessee shall have the first right of refusal for an additional
five-year period under terms and provisions determined by Lessor.
III
RENTAL
The rental to be paid by Lessee to Lessor for the use of
said premises for the seven-year period shall be the sum of
$2,733,558.00, payable yearly in two equal installments on February
10 and October 10 of each year, with the payment for the first year
to be in the amount of $225,000.00 and for each of the remaining
six years to be in the amount of $418,093.00. Should said install-
ments be not paid by Lessee when due, a penalty in an amount equal
to 10% of the past-due installment shall be assessed by Lessor and
shall be payable by Lessee. Installments more than 90 days past
due shall be cause for breach of lease under the provisions of
paragraph XXI of this lease..
IV
FARMING PRACTICES, CROP CONTROL, AND COTTON HISTORY
(a) Lessee agrees to use said premises for farming
purposes only, and in this connection further agrees to diligently
· till, prepare and plant the premises each year to crops and there-
after shall diligently cultivate, irrigate, care for, attend and
harvest, cut, pick, graze or otherwise gather all crops raised or
produced upon said premises in accordance with good husbandry and
the best farming practices in the community, all at Lessee's own
cost and expense. Subject to the approval of the Kern County
Health Department and the State Department of Public Health, Lessee
.shall have the exclusive right to determine the kinds and amounts
of crops to be planted on said premises, including the'amount of
acreage to be used for grazing or permanent pasture, during the
term of this lease; provided, however, that in the event it is
found and determined by the Public Works Director of the City of
Bakersfield, upon substantial evidence, that the kinds and/or
amounts of crops so determined by Lessee are detrimental to the
quality of the ground water table of the premises, the Lessor's
determination of the kinds and/or amounts of crops to be planted on
said premises shall govern to the end that the detriment caused by
the growing of any crops shall be avoided during the term of this
lease or any extension thereof.
(b) Lessee shall, contemporaneously with the execution
of this agreement, furnish to Lessor a statement showing the amount
of acreage to be used by Lessee for each crop or use, and the
amount of acreage which shall lay fallow during the calendar year
1979. Lessee further agrees to provide such a statement for each of
the succeeding calendar years on or before the 1st day of November,
beginning in 1979, showing theamounts of acreage proposed to be
devoted to the various specific crops and uses.
(c) Lessee shall have the right to transfer cotton
history and/or allotment under United States Government regulations
from said premises to other lands owned, leased or operated by
Lessee, or which may hereafter be owned, acquired, leased or
operated by said Lessee, if that be permitted under United States
Government regulations, provided that the leased premises under
this lease shall not suffer any loss of said cotton history and/or
allotment made to said land under Government regulations, by virtue
of transferring such cotton history from said leased premises.
V
WELLS AND PUMPING EQUIPMENT
(a) Lessor will not provide pumps or motors for the
existing water wells within the lease area. All wells constructed
and/or installed by Lessee on said premises, shall, upon the comple-
tion of each drilling operation become the property of Lessor, with
the right vested in the Lessee to use said wells fo~ the term of
this lease.
(b) Lessee shall maintain all wells and pumping equip-
ment, including pump motors, in good running condition during the
term of this lease or any extension hereof, and shall, at its own
cost and expense, repair or replace all worn out or inoperable
parts. Lessee shall provide continual routine maintenance (lubri-
cation, cleaning, etc.) for irrigation pumps located at irrigation
pump stations and tailwater pump stations as shown on plans entitled
"Wastewater Treatment Plant No. 2 Effluent Irrigation System 1977,"
Sheet G-2, attached hereto as Exhibit B. Lessee shall repair or
replace any pump located on the farm as it becomes inoperative.
(c) Any well development on said premises for the purpose
of providing irrigation water shall be approved by the Lessor prior
to construction. All wells drilled on said premises shall be
consistent with the future water requirements of said premises, the
ground water condition and the expected yield of irrigation water
from said wells as determined at the time of said well development.
VI
DITCHES, IMPROVEMENTS, OTHER APPURTENANCES
(a) Lessee shall maintain and keep in good condition and
repair all roads, ditches, pipelines, risers and valves required
for the proper'irrigation or drainage of any portion of the premises
and disposal of storm water and plant effluent, excepting those
pipelines, standpipes and overflow structures shown on Exhibit "B"
to be maintained by Lessor and the road as defined in paragraph
XVII(a)~
(b) Lessee shall maintain the embankments of all ditches
and reservoirs, except the storage reservoirs in Section 9 and 10
of ~ownship 30, Range 28, in order to keep the reservoirs and
ditches watertight. All roadways, ditches and adjacent areas
around the reservoirs, equalization ponds, wells, pump stations and
irrigation structures shall be kept free of weeds and other debris.
(c) Unless otherwise specifically provided in this
lease, all improvements or work of improvement, maintenance or
repair of any nature whatsoever necessary to be done by Lessee,
must first be approved by Lessor and shall be at the sole cost and
expense of Lessee.
(d) Lessee shall construct, build or install at his sole
cost all checks, weirs, levees, culverts and headgates or any other
appurtenances which Lessee considers necessary for the farming of
said land and the disposal of plant effluent.
(e) No provision of this lease agreement shall be con-
strued or interpreted so as to discourage or prevent the Lessor
from making or constructing new improvements upon the premises
during the term of this lease or any extension thereof. Lessor
shall not be liable'for any crop loss as a result of such construc-
tion but shall reduce the rent by an amount equal to the nu~f~r rf
acres taken out of production times the annual rental divided by
the total number of acres leased herein for the duration of the
time that Lessor occupies the land for constructing such improve-
ments.
VII
DISPOSAL OF ALL EFFLUENT
(a) Lessee shall, during the term of this lease or any
renewal or extension thereof, receive and dispose of on the premises
all wastewater effluent and any additional effluent resulting from
the reconstruction, extension or enlargement of existing sewage
disposal facilities.
(b) Lessee shall utilize all wastewater effluent from
the City Wastewater Treatment Plant on the leased premises. No
effluent shall be disposed of outside of leased premises without
written consent of Lessor. Lessee may supplement the wastewater
effluent with irrigation water. No liquid dairy waste is to be
discharged on the leased premises. The disposal of any storm
waters entering the leased premises will be the responsibility of
the Lessee.
(c) Lessee shall notify all persons employed on the
premises that irrigation water used on the premises is treated
wastewater and is not to be used for human consumption. Lessee
shall provide for immunization of all employees on the leased
premises in accordance with the requirement of the Kern County
Health Department.
(d) The Lessor does not guarantee any specific amount of
water suitable for irrigation and shall not be liable for any
damages or damage to crops in the event of insufficient irrigation
water, or in the event of damage or loss of crops through use of
oil or chemical contaminated irrigation water, or excess water.
(e) Lessee shall grade, level or drain and maintain such
areas of the premises covered by this Lease Agreement which for any
reason may be low, and Lessee shall not permit the standing and
stagnation of water.
VIII
GROUND-WATER CHARGES
Lessee shall pay all ground-water charges, taxes, fees
or penalties levied with respect to the ground water-producing
facilities operated on the leased premises during the term of this
lease or any renewal or extension thereof. It shall be the obligation
of Lessee to register with the Kern County Water Agency, on forms
provided by the Agency, all water-producing facilities on the
leased premises and Lessee shall file all statements which may be
required in the manner required by law.
IX
COSTS, EXPENSES AND OTHER CHARGES; WASTE
(a) Lessee shall pay all costs and expenses of irri-
gating, draining, cultivating and harvesting on said premises and
all crops grown thereon, and any and all other costs and charges
incident thereto, and all charges for water, including power and
standby charges, and for electrical energy and other service fur-
nished during the term of this lease or any extension thereof,
whether any of the foregoing costs or charges are levied, imposed
or made by any public utility or'by any publid or private corpora-
tion or by any other person.
(b) Lessee shall not permit or allow the collection of
any waste, debris or trash upon the premises or permit any damage
to be done to the premises.
(c) Lessee shall not allow any liens to be placed
against the leased property.
X
CONSTRUCTION OF IMPROVEMENTS AND TAXES THEREON
Except as herein otherwise provided, all operations
and/or improvements made or placed by Lessee upon the premises
shall be at the sole cost and expense of the Lessee. All buildings
constructed on the premises by the Lessee and all temporary fences,
except those designated as permanent and belonging to the Lessor,
shall be and remain the property of the Lessee and subject to
removal by Lessee within the time limits as specified in Paragraph
XIX.
Lessee shall pay and discharge all taxes, general and
special assessments and other charges of every description which
during the term of the lease shall be levied against the
land and all interests therein includ%ng Lessee's leasehold
interests and all improvements and other property thereon, whether
belonging to Lessor or Lessee, or as to which either of them may
become liable. Such charges shall be paid by Lessee not later
than ten (10) days before any fine, penalty, interest, or cost
may be added thereto for payment. Lessee shall furnish to the
Lessor, within five (5) days after the date of payment, official
receipts or copies thereof, evidencing that the charges have been
paid.
During the term of this lease, Lessee shall protect and
hold harmless the Lessor and the leased premises and all improve-
ments in, on or about the same from all liability for any and all
such taxes, assessments and charges, together with any interest,
penalty, or other sums thereon imposed, and from any sale or other
proceeding to enforce payment thereof.
XI
INDEMNIFICATION, WAIVER
The Lessee shall indemnify, save, protect and hold
harmless the Lessor, City of Bakersfield, the members of the City
Council of said City, and all other officers and employees of
said City against and.from all claims, suits, actions, demands or
liability whatsoever to any person or persons by reason of personal
injuries or death or damage or destruction of property caused by
or arising out of Lessee's operations under the terms of this Lease
Agreement, or any extension thereof, or by Lessee's failure to
comply with any of the terms or provisions of said agreement. The
Lessee shall and does hereby waive any claim against the Lessor,
City of Bakersfield, its officers or employees, for any damage to
livestock, crops, or other property connected with the Lessee's
operations under this lease arising from any cause.
XII
INSURANCE
(a) During the term of this Lease, Lessee shall main-
tain, keep in force and pay all premiums required to maintain and
keep in force liability and property damage insurance. The limits
of such policy shall not be less than five hundred thousand dollars
($500,000) for personal injuries including accidental death for
any one occurrence, and property damage in an amount not less than
thirty thousand dollars ($30,000) for any one occurrence. The
property damage insurance shall cover damage or destruction of
any property, other than that which is owned, leased or in the
care, custody or control of Lessee with the limit applying to any
one accident, disaster or claim.
(b) All insurance required by the express provisions
of this Lease shall be carried only with responsible insurance
companies licensed to do business in the State of California.
All such policies shall be non-assessable and shall contain langu-
age to the effect that:
9 ·
1. The Lessor, City of Bakersfield, its officers,
agents and employees shall be held harmless from any claim arising
out of the use of the ieased premises;
2. The policies are primary and non-contributing with
any insurance that may be carried by the Lessor;
3. The insurer waives the right of subrogation against
the Lessor, City of Bakersfield, or any of its officers, agents
or employees; and
4. The Lessor, City of Bakersfield, shall be named as
an additional insured under said policies.
XIII
ASSIGNMENT OF LEASE
No assignment of any interest in this lease shall be
valid or operative unless the Lessor shall formally approve the
assignee and such assignee executes a lease agreement with the ·
Lessor on the same terms and conditions as the assigned lease.
Lessee shall not sublease without the written consent of the
Lessor.
XIV
MOSQUITO ABATEMENT
Lessee shall comply with all rules and regulations
governing the control of mosquitoes in the operation of the leased
premises. Lessee shall bear any and all costs of mosquito abate-
ment chargeable to the premises.
XV
FENCES
Lessee shall maintain fences around exterior boundaries
and keep the same in good repair. Lessee shall hold the Lessor
harmless and free of liability for any loss sustained by Lessee
or any other person should said boundary fences fail'to confine
livestock to said premises, or for any trespassing over said land.
10.
XVI
DELIVERY OF EFFLUENT TO LEASED PREMISES
Lessor, during the term of this lease and/or extension
thereof, will deliver to the Lessee all of the effluent from the
wastewater treatment plant, for exclusive use on the premises.
Lessor does not guarantee the quantity or quality of
water, either from the wastewater plant or the irrigation wells;
and furthermore, Lessor assumes no responsibility for any crop
loss, loss of animals, or damage due to the quality or quantity of
water.
Lessor reserves the right to divert for Lessor's use 570
million gallons of effluent during the first six months of this
lease agreement. Diversion of effluent by Lessor shall not exceed
10 million gallons per day unless prior written authorization is
received from Lessee.
XVII
MAINTENANCE OF ROAD, PIPELINES, FARM HEADQUARTERS
(a) Lessor will maintain and keep in good condition, the
paved road situated between Sections 3 and 4, 9 and 10, and along
the south line of Section 9, all in T30S, R28E, M.D.M. and located
upon the said leased premises.
(b) Lessee shall maintain farm headquarters site in SE
1/4 of Section 21, T30S, R28E. Lessee's responsibility shall
include maintenance of site surface, buildings, pumps and equipment
and pay all utility costs incidental to the use and operation of
the farm headquarters.
XVIII
CLAIMS OR LIENS AGAINST PREMISES
Lessee shall not permit any claim or lien to be made
against the premises herein leased, or any part thereof, or
11.
against Lessor, for or on account of any work done or material
furnished on or to said land, and in the event that such claim or
lien is filed, Lessee shall immediately cause it to be released and
discharged of record.
XIX
HARVESTING AND REMOVAL OF CROPS
Lessee shall be entitled, at the expiration of this
lease, or any renewal or extension thereof, to an additional thirty
(30) days for the purpose of harvesting and removing therefrom all
crops then growing on said premises, including such personal property
belonging to Lessee which may rightfully be removed from said
premises; provided, however, that as soon as any crop is harvested
and removed, Lessor shall have the right to enter upon and retake
possession of each parcel of land from which such crops have been
harvested.
XX
MINERAL INTERESTS
Lessor reserves the exclusive rights to all minerals,
including but not limited to oil, gas and hydrocarbon substances,
within or underlying said land, or that may be produced therefrom,
and to prospect on said land for said water and said minerals and
to mine, drill for and remove the same.
This lease is made subject to restrictio~and conditions
of record, to any and all easements and rights-of-way and to any
and all outstanding interests in, and rights to, minerals and mineral
ores, including, but not limited to, oil, natural gases, hydrocarbon
substances, geothermal steam, brines and minerals in solution and
sand, gravel and aggregates, in and underlying the leased premises.
XXI
BREACH OF LEASE
Upon the breach by Lessee of any of the terms, covenants
or conditions of this lease, and the failure of Lessee to remedy
the default within thirty days after receipt of written notice from
Lessor so to do, then at its option Lessor may thereupon declare
this lease terminated and re-enter and take possession of said
leased premises, including all personal property thereon and all
crops growing thereon or harvested therefrom, without further
notice or demand. Lessor, without prejudice to any other remedies
it may have, may care for, harvest, remove and sell such crops,
retaining from the proceeds of the sale thereof all amounts due
Lessor from Lessee, together with a sufficient additional amount to
reimburse Lessor for all reasonable costs and expenditures incurred
in connection with caring for, harvesting, removing and selling
such crops, paying the remainder, if any, to Lessee.
The waiver by Lessor of any breach of any covenant or
condition hereof shall not be a waiver of any other or subsequent
breach hereof, not of any other covenant or condition hereof. The
acceptance of payments hereunder by Lessor shall not be deemed to
be a waiver of any preceding breach by Lessee of any provision
hereof, other than failure of Lessee to pay such particular payment
so accepted, regardless of Lessor's knowledge of such preceding
breach at the time of acceptance of such payment.
XXII
BANKRUPTCY
If Lessee is adjudicated a bankrupt, or shall make an
assignment for the benefit of creditors, or file a voluntary peti-
tion under any law having for its purpose the adjudication of
Lessee a bankrupt, or the extension of time of payment, composi-
tion, adjustment, modification, settlement or satisfaction of the
'liabilities of Lessee, or a receiver be appointed for the property
13.
of Lessee by reason of the insolvency of Lessee, notwithstanding
.anything to the contrary elsewhere in the lease. Lessor shall have
the immediate right to terminate this lease and to take exclusive
possession of the leased premises. The acceptance of rent or other
payments for the use of the leased premises shall not constitute a
waiver of Lessor's right to terminate this lease as above set
forth.
XXIII
ATTORNEYS' FEES, SURRENDER OF PREMISES
(a) Lessee agrees, in the event it becomes necessary for
Lessor to enforce any of the provisions of this lease, to pay a
reasonable amount as and for attorneys' fees as may be determined
by the court.
(b) Immediately upon the expiration or other termination
~of this lease as to the whole or any portion of the said premises,
the Lessee shall surrender to the Lessor the whole of said premises
or said portion as the case may be. Upon such expiration or termina-
tion the Lessee shall promptly execute, acknowledge and deliver to
the Lessor a good and sufficient quitclaim deed of the land to
which such expiration or termination applies.
XXIV
RIGHT OF FIRST REFUSAL
On or before January 1, 1985, the Lessee shall be in-
formed in writing that he Shall have the right of first refusal to
lease the subject premises for an additional period of five (5)
years upon terms specified by Lessor. Lessee shall exercise such
right of first refusal, by delivering a written notification to
Lessor no later than July 1, 1985.
14.
IN WITNESS WHEREOF, the parties hereto have caused this
lease agreemen% to be executed, the day and year first-above
written.
LESSOR:
CITY OF BAKERS~ELD
~ D~r~c~t ~!
o ks L 'City~lerk
APPROVED AS TO FORM:
,~ F~ ~<; Att~ey
City
COUNTERSIGNED:
/? ..;.., .
Assistant 'City ,Manager-Finance
LESSEE:
GARONE CATTLE COMPANY
doe Garone
15.
City Conlract No.
87- 0
AGREEMBNT NO.
(AMENDMENT TO LEASE AGREEMENT NO. 78-165)
THIS AMENDMENT TO LEASE AGREEMENT NO. 78-165 is made
and entered into thi~''' ~ '~ day of ~0~ , 1987, by and
between the CITY oF BAKERSFIELD, a municipal corporation, herein-
after referred to as the "City", and GARY GARONE, assignee of the
original lessee under said lease agreement, hereinafter referred
to as "Garone."
W I T N E S S E T H:
WHEREAS, the Kern High School District, hereinafter
referred to as the "District", the City and Garone have entered.
into an agreement dated __3une 17. 1987 , hereinafter referred
to as the "agreement", pursuant to which the District shall pur-
chase approximately forty (40.0) acres of real property from the
city, real p'roperty currently under lease to Garone, subject to
the terms and conditions set forth in that agreement; and
WHEREAS, pursuant to that agreement, Garone and the City
are obligated to execute this amendment, a copy of which was
attached to the agreement as an exhibit and incorporated therein
by reference.
NOW, THEREFORE, in consideration of the covenants, terms
and conditions set forth hereinbelow, the City and Garone agree
as follows:
1. The above-referen6ed 40 acres is deleted from the
leased premises set forth in Lease Agreement No. 78-165, as
amended, and Garone, as lessee thereof, relinquishes all right,
title and interest thereto except as provided in Paragraph 2
below.
2. Garone shall be entitled to use the east 45 feet of
the above-described property for purposes of moving farm equip-
ment across such east 45 feet during the term of the lease
amended hereby or any extension thereof.
~l~y shall
3. Not later than September 1, 1987, the ~'~
acquire that real property described in E~hibit ~" attached
hereto and incorporated herein by reference~ and such property
shall, by this agreement, be added to the premises leased from
City by Garone pursuant to Agreement No. 78-165, as amended, for
the entire term thereof, including the two five-year option
periods prov~ided for in Agreement No. 85-22~, if such options are
exercised. Should the City not acquire the property described in
Exhibit "A", or equivalent alternative property, the annual
rental~payment specified in Agreement No. 85-226 shall be reduced
by one percent (1%).
o0o ..........
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed, the day and year first-above written.
CITY OF BAKERSFIELD
Mayor
APPROVED AS TO FORM:
RICHARD J. OBERHOLZER
City Attorney/f
'/ ~/ GARY GARONE
AJS/meg
A AGMT 4
GARONEAMi
- 2 -
EXHIBIT "A"
That portion of the southeast quarter of Section 28, Township 30 South,
Range 28 East, M.D.B.&M., in the Count~* of Ker~, S[Ste of California, more
particularly described as follows:
Ail of Parcel "B" as shown.on Parcel Map-No. 1665 filed for
record January 14th, 1974 in Book 8 of Parcel Maps at Page 138 in
the Office of the Kern County Recorderl
Containing ]40.798 acres.
ry:mro Dll PM1665.B
MEMO. RANDUM
TO: E.W. SCHULZ, PUBLIC W~RKS DIRECTOR
FRC~4: DEWAYNE STARNES, CIVIL ENGINEER III
DATE: JUNE 14, 1989
SUBJECT: 140 ACRE PARCEL -WASTEWATER TREATMENT PLANT ~2
I have attached Agreement No. 87-140 which was entered into on
June 17, 1987.
In the agreement the City was to sell 40 acres which was under
lease by Mr. Garone to the Kern High School District. The 40 acre block of
land was deleted from the lease premises set forth in Lease Agreement 78-165
(also attached). Except for the use of the east 45 feet of the 40 acre
Parcel, Mr. Garone relinquished all right, title and interest. The only re-
quirement of the City was to acquire the 140 acre parcel prior to September
1, 1987, otherwise, the annual rental payment specified in Agreement No.
85-226 would be reduced by one percent.
DS/lh
4 :M-061489
140 ACRE FARM LAND ACQUISITION - WASTEWATER TREATMENT PLANT 2
Budget Approval For Land Acquisition July 1, 1987
City offer to purchase from land owner (Burusco) August 24, 1987
farmland at appraised value of $281,500
Threat of condemation by City September 15, 1987
Acceptance of City offer by owner (Jose Burusco) September 16, 1987
Owner requested additional time to move his
farm equipment, locate a new site and remove
crops.
Escrow instructions prepared allowing September , 1987
owner to retain possession until
December 15, 1987.
Escrow instructions revised at owners request October 12, 1987
to allow owner additional time to locate a new
site. New escrow closing date is
January 4, 1988.
Escrow instructions revised again at owners January 18, 1988
request allowing owner to retain possession
until February 4, 1988. Additional time
was for locating a new farm site.
Acquisition approVed by City Council. March 2, 1988
Escrow Closed and City took possession April 15, 1988
Plans and specifications completed for May, 1988
irrigation system for additional farmland
Garone (Farm Tenant)requested delay May, 1988
of work on irrigation system during
sum~r months.
Contract award and construction of Oct.-Dec., 1988
irrigation system.
Contract award to Odis Dykes January 18, 1988
for land leveling
Contractor for land leveling informed March, 1988
City he was unable to obtain bonding.
Contract award was rescinded April 12, 1988
and awarded to second low bidder
(Turman Const. )
Land leveling work by contractor Mayl June 1989
Land available to farm tenant June 30, 1989
4: FLA
MAY
7,
lggo
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: GREGORY J. KLIMKO, FINANCE DIRECTORA~t/~-~~
SUBJECT: MANAGEMENT LETTER
At the Council's request, I have provided a more specific response to the
Management Letter submitted by our independent audit firm of KPMG Peat Marwick.
I have listed the individual comment headings as well as the City staff assigned
to implement recommendations and appropriate deadlines.
Self Insurance Estimated Claims Liability
Scott Manzer (Risk Manger) will prepare an Incurred But Not Reported (I.B.N.R.)
estimate by July 31, 1990 for fiscal year ended June 30, 1990.
Electronic Data Processing (EDP) - File Mangement
Mike Kennedy (Data Processing Manager) will evaluate librarian products availa-
ble for the City PRIME mainframe computer system and report such findings to the
Finance Director by January 1991.
Assessment District Reserves for Debt Service
Gil Rojas (Assistant Finance Director) will draft a pOlicy by June 30, 1990 that
sets parameters for Bond Calls and Bond Reserve fund reductions based on retire-
ment of debt.
Financial Statement Preparation
The first item regarding periodic reconciliation of fund schedules to General
Ledger accounts is currently in effect and the second item regarding prepar-
ing of CAFR schedules on the City's Mainframe Computer System is a good idea,
however, it has a low priority when considered with other data processing and
finance projects.
Electronic Data Processing (EDP) - Disaster Recovery Plan
Mike Kennedy will prepare a Disaster Recovery Plan by March 1, 1991.
HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
MAY 7; 1990
PAGE TWO
Enhancement of the Internal Audit Function
All additional personnel requests are considered annually during budget prepara-
tions by the City Manager. The City Manager prioritizes all personnel requests
for recommendation to the Council.
Personal Computers
By August 1, 1990 Mike Kennedy will conduct a City-wide orientation on personal
computers in the City of Bakersfield. Topics such as recommended back-up proce-
dures and "The Care and Feeding of your PC" will be discussed. The orientation
will be an annual event which will be used as a forum to disseminate information
as well as provide an avenue for the PC users to provide input and share
experiences. The comment regarding weekly back files for off-site storage or
EDP storage is not feasible for personnal computers.
krc
GR050790
Peat Marwick
Certified Public Accountants
725 South Figueroa Street
Los Angeles, CA 90017
December 20, 1989
CONFIDENTIAL
The Honorable City Council
City of Bakersfield
1501 'Truxtun Avenue
Bakersfield, California 93301
Honorable Members of the City Council:
In connection with our audit of the general purpose financial statements of the City of
Bakersfield, California, as of and for the year ended June 30, 1989, we evaluated the
operations of the City's major-f'mancial and accounting systems. The ultimate objective of
this evaluation is to provide a basis for our independent auditors' report, but another very
important benefit is the ability to present observations about oppormrfifies for improvement
to the systems.
This letter presents our observations. It is divided in accordance with the following major
objectives:
· Enhancement of management information
· Increase in protection of assets
· Increase in accuracy of accounting records
· Prior year comments
· Discussion of nature of letter and its limitations
The implementation of changes recommended in this letter can be facilitated if management
and the members of the City Council:
· Consider and establish priorities for implementing the changes.
· Develop an overall plan and method of implementation that reflects the Priorities.
· Assign the responsibility for carrying out each change to a specific individual.
, ,.~': ~'~ ',i-: :',~.',t :~.~%: Member Firm of
~l~tbl~ Klynveld Peat Marwick Goerdeler
~Peat Marwick
Honorable Members of the City Council
City of Bakersfield
December 20, 1989
Page 2 of 7
· Establish time-frames for implementation of each change.
· Schedule progress reports from the responsible City officials and conduct
progress meetings to further discuss progress and to resolve problems that arise.
These steps should provide assurance that management and the Council's desires are carded
out in a timely and responsible manner.
Enhancement of Manaeement Information
Self-Insurance Estimated Claims Liability
The City has developed a system whereby the claims liability for reported claims is
estimated for each case and reviewed periodically by authorized personnel in order to assure
that an accurate estimate of the future claims liability is obtained. However, the City's
system does provide a method to accurately estimate claims which have been incurred but
not reported (IBNR). For the fiscal year ended June 30, 1989, the Risk Management
Department estimated IBNR claims to be 5.0% of the estimated case claims liability for
liability losses and 2.5% for workers' compensation losses.
We recommend that the City begin to prepare loss developments. We understand that in the
past, the preparation of such information would not be practical due to the variety of self
insured retentions (SIR) maintained by the City. However, since July 1, 1986, the City has
maintained its SIR at $1,000,000, and the preparation of loss developments from this date
would be a useful tool in the estimation of the City's claim reserves.
Ci_ty Response
The City agrees with this recommendation and has begun to prepare loss development
information using a method that will make estimating reserves more efficient, especially
esumates for incurred but not reported claims.
Increase in Protection of Asset~
Electronic Data Processing (EDP) - File Management
We understand that the City does not have a librarian software package installed on their
computer system. A librarian software package would provide:
~Peat Marwick
Honorable Members of the City Council
City of Bakersfield
December 20, 1989
Page 3 of 7
· an inventory of all programs installed on the system (including such information as
installation date, last modification date, etc),
· the EDP Department with a method of tracking access and attempted access to City
programs, and
· a record of the users' execution of the programs.
We recommend that the City install a librarian software package as this would enhance the
controls over access to their computer system.
City Response
The City recognizes the benefits of librarian systems to aid in the control of the modification
and implementation of modifications to programs on the central computer system. The
Primos operating system currently running on the Prime 6150 central computer system is
not supported by a librarian program. We understand there may be a similar software
product available from a third party vendor. We intend to evaluate this product for
consideration in the furore.
Increase in Accuracy of Accountine RecorO~
Assessment District Reserves for Debt Service
The City has reserved certain funds for debt service in accordance with the terms of the
indentures of various assessment district bond issues. These reserves are used to
supplement future debt service requirements on assessment district bonds should the need
arise. The balance of the reserve is to be in proportion to the amount of principal
outstanding. Upon review of the funds reserved for debt service, we noted that the City is
not making a reduction to the reserve balances for bonds which matured during the year.
We recommend that the amount of funds reserved for debt service be reviewed upon each
principal payment. A reduction in the amount reserved for debt service will enable the City
to reduce restricted cash on these issues and use the surplus funds to call bonds at an early
date.
Ci_ty Response
The City of Bakersfield is not required to reduce the reserve in proportion with the principal
outstanding. In fact, bond counsel has recommended not reducing the reserve unless it
would free up a material amount with which to call bonds.
Financial Statement Preparation
We noted that the City does not have standardized schedules for preparing fund financial
statements. Presently the City accountants prepare fund financial statements on the personal
~/~17~ Peat Marwick
Honorable Members of the City Council
City of Bakersfield
December 20, 1989
Page 4 of 7
computers (PC) utilizing a standard software package. These PC schedules are maintained
separate from the City's General Ledger accounting system. In the past, this has led to
situations whereby adjustments to the f'mancial statements which had been proposed by City
accountants were omitted from the fund financial statements.
We recommend that thc City implement a system whereby fund financial statements are
prepared using financial statement categories that are used in the City's Comprehensive
Annual Financial Report (CAFR). Fund schedules should be reconciled periodically to the
General Ledger to assure that all adjustments posted to the General Ledger have been
included in the fund financial statements. This process will assure that all adjustments
posted have been included in the financial statements. Further, the City should assess the
possibility of preparing CAFR schedules on the City's mainframe computer system. This
will allow the fund financial statements to be updated by the general ledger accounting
system upon posting of an adjustment and would reduce the time expended by City
.accountants in preparing fund financial statements.
Ci_ty Response
The City agrees with the concept of an integrated system, however, there are other priorities
for data processing computer and programming time that must be considered before
undertaking this recommendation.
Prior Year Comments
In the prior year's audit, we made the following observations and recommendations which
are also applicable to the current year's findings. Accordingly, these comments are included
for your review and have been updated for any additional findings disclosed through the
current year's audit.
Electronic Data Processing (EDP) - Disaster Recovery_ Pl~an
As noted in the prior year's letter, the City does not have a formal disaster recovery plan for
its EDP Department. In the event of a disaster involving the computer system, it would be
critical for the City to continue its EDP support processing elsewhere.
We continue to recommend that a formal written disaster recovery plan be prepared and
tested so that, in the event of a disaster, the City would be able to continue normal
operations with a minimal loss of time and information.
Ci_ty Response
The City supports the recommendation for a more formal disaster recovery program. As we
become more dependent on new technology, the need for this becomes greater. During the
1990-91 fiscal years, a more formal document with prOCedures for dealing with a disaster
will be drafted.
Peat Marwick
Honorable Members of the City Council
City of Bakersfield
December 20, 1989
Page 5 of 7
Enhancement of the Internal Audit Function
As noted in the prior year's letter, the City's Internal Audit Department is comprised of one
Internal Auditor and a one person clerical/accountant staff. The staff is currently responsible
for performing the monthly cash reconciliations, verifying the business tax proceeds
calculations from businesses within the City, and, as special areas of concern arise, other
tasks requested by the City Manager. We believe that the Internal Audit Department should
be more involved with performing operational audits of the various City Departments and
with reviewing the f'mancial data produced by the Finance Department. The tasks currently
being performed by the Internal Auditor, as described above, do not allow adequate
exposure to these other areas.
We continue to recommend that the following procedures be implemented regarding
establishment of a formal Internal Audit Function:
· The City Manager should determine the various areas within the City's
operations that would benefit most by an operational audit and prioritize the need
for internal review.
· The City Manager should then determine whether the Internal Audit Department
is adequately staffed to effectively perform the required procedures.
· The duties and procedures to be performed by the Internal Auditor, including a
schedule regarding the timing of procedures, should be formally documented.
· The City Manager should review all the results of the procedures performed by
the Internal Auditor and perform periodic evaluations.
By implementing these procedures, the Internal Audit Deparunent's responsibilities will be
enhanced to provide the City with additional information and improved internal control.
Ci_ty Response
All recommendations are in place, however, staffing levels are considered separately as a
budget issue.
Personal Computers
The City has invested in personal computers (PC) for use by various City Departments.
Accordingly, the use of PC spreadsheets by the City's accountants is an integral component
in the completion of their assignments. The City should develop formal procedures to
maintain control over the use of and data generated by the PCs.
Peat Marwick
Honorable Members of the City Council
City of Bakersfield
December 20, 1989
Page 6 of 7
We continue to recommend that the City establish basic controls over its hardware and
software. Only compatible hardware should be utilized by all City Departments and the use
of standardized software will facilitate control of PC documents and usage. A standardized
network for communication by and between the PC and mainframe should also be adopted
to control PC access to the City's mainframe computer if, indeed, such information link is
being considered. Data files and any other specialized programs that are generated by the
PCs should be backed up daily or after every use. The City should consider weekly back
up fries for off-site storage or safe keeping in the EDP Department.
Ci_ty ReSPonse
All recommendations are already in place with one exception. The suggestion that personal
computer users be admonished to back up files on a daily basis is impossible to monitor.
All users are given training conducted by the data processing staff on the care and use of
their computer. During this training, users are given instruction on the proper procedures
for backing up fries to prevent accidental loss or destruction of data.
Discussion of Nature of Letter and Its Limitatioq,5
As stated, our audit referred to in the first paragraph of this letter was based on a study and
evaluation of the system of internal accounting control and selective tests of accounting
records and related data. This study and evaluation was more limited than would be
necessary to express an opinion on the system of internal accounting control taken as a
whole. Accordingly, it would not necessarily.disclose all opportunities for improvement or
'all weaknesses in the City's system of internal accounting control. The City must rely upon
an adequate system of internal accounting control as its principal safeguard against
irregularities and it is management's responsibility to ensure that the system is adequate.
Because of inherent limitations in any system of internal accounting control, errors or
irregularities may nevertheless occur and not be detected. Also, projection of any evaluation
of the system to furore periods is subject to the risk that procedures may become inadequate
because of changes in conditions or that the degree of compliance with the procedures may
deteriorate.
A study and evaluation made for the limited purpose disclosed above would not necessarily
disclose all material weaknesses in the system. Accordingly, an expression of an opinion
on the system of internal accounting control taken as a whole cannot be made.
This letter is not intended to imply that our tests failed to disclose many commendable
features in the current operating procedures of the City. However, from the standpoint of
practicality, this letter is limited to situations which in our judgement merit or could benefit
from corrective action.
Peat Marwick
Honorable Members of the City Council
City of Bakersfield
December 20, 1989
Page 7 of 7
Finally, the comments contained in this letter were considered in determining the nature,
timing, and extent of audit tests to be applied in our audit of the City's general purpose
financial statements, and do not modify our report dated October 27, 1989 on such general
purpose financial statements.
We would be pleased to discuss the comments in this letter with you at your convenience.
We would also like to acknowledge the courtesy and helpfulness extended to us by the
personnel of the City during the course of our audit.
Very truly yours,
MEMORANDUM
May 7, 1990
TO: Dale Hawley, City Manager ~ ~ ~.~
FROM: Jake Wager, Economic Development Directo
SUBJECT: Final Staff.Recommendations for Useof FY 90-91 CDBG
Entitlement and Program Income for CDBG Activities
I. Request for CDBG Funds from Other Agencies
1. The Alliance Against Family Violence (~-'"Y~ Counseling Center
AAFV is requesting $100,000 for the acquisition of-a 2,180
square foot building at 2211 17th Street that they currently
occupy. This building will be used as an outreach counseling
center. Estimated total acquisition cost for the building is
$154,000. The agency is willing to generate up to $84,000 in
matching funds. Low to moderate income benefit is up to 100%.
Staff Recommendation - $70,000 for acquisition only. $70,000
2. The Arthritis Association of Kern County (AAKC) Adaptive
Aquatic Center
The AAKC has submitted a propoSal for construction of a 7,091
square foot adaptive aquatic center. This facility will
include the construction of a therapeutic pool, locker room and
administration offices. The association is requesting$150,000
from the City and has submitteda similar request to the County
of Kern. The site for the center is on Westwind Drive and 19th
Street.
According to theArthritis Association, the acquisition of this
9,840 square foot parcel was completed using agency funds of
$t50,000. The total cost of the project is approximately
$774,000. They are proposing to generate an additional
$324,000 of matching funds for design and construction of the
· project. Low to moderate income benefit is up to 100%.
Staff Recommendation - $150,000 for construction only. $150,000
3. Wisteria House Rehabilitation Project
Aunt Cherie's Home submitted a proposal for rehabilitating a
second center for unwed teen mothers. 'The proposed facility
is located at 701 Wisteria Street (within the County limits).
The building is currently owned by the Gleaner's and will be
leased for $t.00 per year. Total request is for $95,000
specifically for rehab of this facility. No matching funds
are proposed for this project. No application to the County
was submitted. Low to moderate income benefit is up to 100%.
Staff Recommendation - No funds~are recommended for this
project.
4. Baker Street Library Restoration Improvements - Phase II
The County of Kern is requesting funds to rehabilitate .the
'interior spaces of the main floor of the library at 1400 Baker
Street. The total floor space involved in the restoration
project is approximately 5,000 square feet. The proposed
project is estimated to cost $325,000 of which the' City is
asked to contribute $100,000. Low to moderate income benefit
is approximately 71.11%.
Staff Recommendation - No funds are recommended for this
project. This project will be considered if reprogrammed funds
are
available at the end of FY 89-90.
5. Graffiti Removal Program
The CD Division proposes to coordinate the removal of graffiti
in low-income neighborhoods within the City of Bakersfield.
The program is primarily for private properties where
permission has been received to remove graffiti. Low to
moderate benefit will be 5i%+.
Staff Recommendation - $40,000
2
6. Kern County Economic Opportunity Corporation (KCEOC) Family
Health Clinic
KCEOC is requesting assistance for the acquisition and
construction of a medical facility to replace their leased
facility. The proposed facility is to be located west of the
existing clinic at 699 E. Brundage Lane (within County limits).
The new site will increase the operation from 3,000 square feet
to a 8,000 square foot facility. KCEOC is requesting $250,000
from the City, $650,000 from the County and $370,000 from a
California Health Facility Construction Loan Insurance Program
for an estimated total cost of $1,270,000. Low to moderate
benefit will be 63%+.
Staff Recommendation - No funds are recommended for this
project.
7. Fair Housing Program
Continued promotion of fair housing program through
educational, counseling, and remediation of tenant, landlord
and housing related issues.
Staff Recommendation - $65,000
II. Requests for CDBG Funds fr°m City Departments
1. City of Bakersfield curb and Gutter Improvements - Design
and construction of approximately 15,046 1.f. of infill curb
and gutter in the following proposed residential locations:
A. Brundaqe Lane curb and Gutter Project
Construction of infill curb and gutter for the area bounded by
Palm, Brundage, A and H Streets for an estimated cost of
$60,000. Low to moderate income benefit for the eligible area
is approximately 49%. An income survey will be conducted by
CD staff Prior to design for verifying those streets that
qualify for CDBG assistance (e.g., at least 51% low/moderate
income benefit).
Staff Recommendation - $34,000
3
B. Chester Avenue Area Curb and Gutter Project
Curb and Gutter for the area bounded by 4th, 2nd, H and Chester
Avenue for an estimated cost of $45,000. Low to moderate
income benefit is approximately 49%. An income survey will be
conducted by CD staff prior' to design for verifying those
streets that qualify for CDBG assistance (e.g., at lease 51%
low/moderate income benefit).
Staff Recommendation - $39,000
C. Kern Street Curb and Gutter Project
Curb and gutter on Kern Street from Flower Street to Highway
178 for an estimated cost of $15,000. Low to moderate income
benefit is approximately 56%.
Staff Recommendation - $18,000
D. Sonora Street Area Curb and Gutter Project
Cross drains, curb and gutter for the area bounded by East
California, Truxtun Avenue, Sonora Street and Baker Street,
totaling $200,000. Low to moderate income benefit is
approximately 61%. Area is predominantly commercial in land
use.
Staff Recommendation - No funds are recommended for this
project.
E. Sumner Street Area Curb and Gutter Project
Cross drains, curb and gutter for the area bounded by East
Truxtun, Sumner, Beale and Haley for a total estimated cost of
$70,000. Low to moderate income benefit is approximately
61.29%. Area is predominantly commercial in land use.
Staff Recommendation - No funds are recommended for this
project.
2. Union Avenue Infrastructure Improvements
Sidewalk median landscaping, street lighting, and curb and
gutter along the right-of-way on Union Avenue between
California and Terrace Way for a total estimated cost of
$323,520 of which $161,760 is requested from the City. Low to
moderate income benefit is approximately 54.2%.
4
Staff Recommendation - No funds are recommended for this
pro~ect.
3. ~Jefferson Park Improvement
Construction of a new restroom facility at Bernard and Beale
Avenue to replace an out-dated 40 to 50 year-old substandard
restroom. Estimated square footage of new facility is 500
square feet. Total funds needed - $50,000. Low to moderate
income benefit is 51%.
Staff Recommendation - $55,000
4. Martin Luther King Jr. Community Center Weight Room Addition
The addition of a 750 square foot building to the Community Center
facility for an estimated cost of $20,000. Low to moderate income
benefit is approximately 74.42%.
Staff Recommendation - No funds are recommended for this
project.
5. Neighborhood Business Revitalization Program ....
Funding of special Economic Development activities designed to
enhance economic activity, encourage the growth of small
businesses, and promote commercial revitalization in targeted
areas of the City. Goals of the program are: 1) predominantly
create or retain permanent jobs for tow/moderate (LM) income
persons; 2) primarily serve a L/M income residential area; or 3)
encourage redevelopment of a blighted area.
.Staff Recommendation - $84,360
6. Bakersfield Senior Center Rehabilitation Project (Ph. II)
Retrofitting of the main facility at 530 6th Street. Improvements
to include roof and heating/cooling replacements. Low to moderate
income benefit is ~approximatety 100% (clients are senior
citizens).
Staff Recommendation - $34,000
5
7. Central Park Concrete Improvements
I~stallation of approximately 600 1.f. of walkway and curb and
gutter in downtown Central Park (corner of 19th and R Streets) to
replace dilapidated concrete.
Staff Recommendation - $18,000
8. Parks Water System Improvements - State Mandated
Installation' of state mandated back flow devices and pumps
assemblies for irrigation of Central Park (corner of 19th and R
Streets) and Jefferson Park (S.E. corner of Bernard and King
Streets).
Staff Recommendation - $27,000
III. Source of Funds
Source Amount
1990/91 Program Income $299,000
Entitlement 1990/91 $1,201,000
Total $1,500,000
Note: See attached 1990 CDBG Application Projected Use of Funds Sheet.
~ :- ~,-~CITY O~
BAKERSFIELD
'COMMUNITY DEVELOPMENT
BLOCK .GRANT"
~:A'P PLI CATI O N
F.Y. 1990- 1991
1501'TRUXTUN AVENUE
iBAKE R S Fi'E LD ,CALl FORNIA
93301
(805) 326-3764
FEDERAL ASSISTANCE
City of B~k~r~ield CommoDity
City of Bakersfield
Co--unity Development J. David Bates, Associate Planner
1501 Truxtun Avenue (805) 326-3764
Bakersfield, Kern County, CA 93301
U.S. Dept. of HUD, L.A Office, Re~ion
Co--unity Development Block Grant Program.
~E: Co--unity Development Block Grant This project is designed to address local
housing needs, upgrade the physical environ-
t= ~EC~y~i~:. c~ ua~. ,~.): ment and provide for a viable urban
co--unity.
City of Bakersfield
July 1, June 30, : "
1990 !9S~ 17th and 20th : 17'th ~D~'~Q+~
1,201,000
L~I
O,~ ~ S 558,000
299,000
*0~ I 2,058,000
J. Dale Hawley "[ City Manaoer~ (805) 326-375!
CITY OF BAKERSFIELD
COMMUNITY DEVELOPMENT
BLOCK GRANT PROGRAM
FINAL STATEMENT OF COMMUNITY DEVELOPMENT OBJECTIVES
The primary objective of the Housing and Community Development Act of 1974
is the development of viable urban communities, by providing decent housing,
suitable living environments and expanding economic'opportunities,
principally for persons of low and moderate income. Consistent with this,
the following objectives will be used for the 1990-91 Community Development
Program.
1.. the elimination of slums and blight and the prevention of
blighting influences, deterioration of property and neighborhood and
community facilities of importance to the welfare of the community,
principally for persons of low and moderate income;
2. the elimination of conditions which are detrimental to health,
safety, and public welfare, through code enforcement, demolition, interim
rehabilitation assistance, and related activities;
3. the conservation and expansion of the City s housings stock in
order to provide a decent home and a suitable living environment for all
persons, but principally those of low and moderate income;
4. the expansion and improvement of the quantity and quality of
community services, principally for persons of low and moderate income,
which are essential for sound community development and for the development
of viable urban communities;
DBNOT5.1.1
5. a more rational utilization of land and other natural resources
and the better arrangement of residential, commercial, industrial,
recreational, and other needed activity centers;
6. the reduction of the isolation of income groups within
communities and geographical areas and the promotion of an increase in
the diversity and vitality of neighborhoods through the spatial deconcentration
of housing opportunities for persons of lower income and the revitalization
Of deteriorating or deteriorated neighborhoods to attract persons of higher
income;
7. the restoration and preservation of properties of special value
for historic, architectural, or aesthetic reasons; and
8. the alleviation of physical and economic distress through the
stimulation of private investment and community revitalization in areas
with population out-migration or a stagnating or declining tax base.
DBNOT5.1.2
COMMUNITY DEVELOPMENT BLOCK GRANT
GRANTEE CERTIFICATIONS
In accordance with the Housing and Community Development Act of 1974; as'amended,
and with 24 CFR 570.303 'of the Community Development Block Grant regulations,
the grantee certifies that:
(a) It possesses legal authority to make a grant submission and to execu%e, a
community development and housing program;
(b) Its governing body has duly adopted or passed as an official act a
resolution, motion or similar action authorizing the person identified as
the official representative of the grantee to submit the final statement
and amendments thereto and all understandings and assurances contained
therein, and directing and authorizing the person identified as the
official representative of the grantee to act in connection with the
submission of the final statement and to provide such additional
information as may be required;
(c) Prior to submission of its final statement to HUD, the grantee has:
1. Met the citizen participation requirements of Section 570.30!(b);
2. Prepared its final statement cf community development objectives and
projected use of funds in accordance with Section 570.301(c) and made
the final statement available to the-public;
.(d) It is .following a detailed citizen'participation plan which:
!. Provides for and encourages citizen participation, with particular
emphasis on participation by persons of iow and moderate income who
are residents of slum and blighted areas and of areas in which funds
are proposed to be used, and provides for participation of residents
in low and moderate income neighborhoods as defined by the local
jurisdiction;
2. Provides citizens with reasonable and timely access to local
meetings, information, and records relating to the grantee's proposed
use of funds, as required by the regulations of the Secretary, and
relating to the actual use of funds under the Act;
-1-
3. Provides for technical assistance to groups representative of persons
of low and moderate income that request such assistance in developing
proposals with the level and type of assistance to be determined by
the grantee;
4. Provides for public hearings to obtain citizen views and to respond
to proposals and questions at all stages of ~the community development
program, including at least the development of needs, the: review of
proposed activities, and review of program performance, which
hearings shall be held after adequate notice, at times and locations
convenient ' to potential or actual beneficiaries ~ and with
accommodation for the handicapped;
5. Provides for a timely written answer to written complaints and
grievances, within 15 working days where practicable, and
6. ' Identifies how the needs of non-English speaking residents will be
met in the case of public hearings where a significant number of non-
English speaking residents can be reasonably expected to participate.
(e) The grant will be conducted and administered in compliance with:
1. Title VI of the Civil Rights Act of 1964 (Public Law 88-352; 42
U.S.C. Section 2000d et seq.); and
2. Title VIII of the Civil Rights Act of 1968 (Public Law 90-284; 42
U.S.C. Section 3601 et
f) It will affirmatively further fair housing;
g It has developed its final statement of projected use of funds so as to
give maximum feasible priority to activities which benefit low and moderate
income families or aid in the prevention or elimination of slums or blight;
(the final statement of projected use of funds may also include activities
which the grantee certifies are designed to meet other community
development needs having a particular urgency because existing conditions
pose a serious and immediate threat to the health or welfare of the
community, and other financial resources are not available); except that
the aggregate use of CDBG Funds received under section 106 of the Act, and
if applicable, under section 108 of the Act, during the 1987, 1988, 1989
and 1990 program years, shall principally benefit persons of low and
moderate income in a manner that ensures that not less than 60 percent of
such funds are used for activities that benefit such persons during such
period;
(h) It has developed a community development plan, for the period specified
in paragraph (g) above, that identifies community development and housing
needs and specifies both short and long-term community development
objectives that have been developed in accordance with the primary
objective and requirements of the Act;
-2-
i) It is following a current housing assistance plan which has been approved
by HUD;
j) It will not attempt to recover any capital costs of public improvements
assisted in whole or in part with funds provided under section 106 of the
Act-or with amounts resulting from a guarantee under section 108 of the
Act by assessing any amount against properties owned and .occupied by
persons of low and moderate income, including any fee charged Or assessment
made as a condition of obtaining access to such public improvements,
unless;
I. Funds received under section 106 of the Act are used to pay the.
proportion of such fee or assessment that relates to the capital , ,
costs of such public improvements that are financed from revenue
sources other than under Title I of the Act; or
2. For purposes of assessing any amount against properties owned and
occupied by persons of moderate income, the grantee certifies to the
Secretary that it lacks sufficient funds received under section 106
of the Act to comply with the requirements of subparagraph (1) above;
k) !ts notification, inspection, testing and abatement procedures concerning
lead-based paint will comply with Section 570.608;
1) It will co~mly with the acquisition and relocation requirements of the
Uniform Relocation kssistance and Real Property Acquisition Policies Act
of 1970 as required under Section 570.606(a) and Federal J_mplementing
regulations; the requirements in Section 570.606(b) governing the
residential antidisplacement and relocation assistance plan under Section
104(d) of the Act (including a certification that the grantee is following
such a plan); the relocation requirements of Section 570.606(c) governing
displacement subject to Section 104(k) of the Act; and the relocation
requirements of Section 570.606(d) governing optional relocation assistance
under Section 105(a)(ll) of the Act; and
(m) It will comply with the other provisions of the Act and with other
applicable laws.
-3-
CERTIFICATION REGARDING DRUG-FREE WORKPLACE REQUIREMENTS
The certification set out below is a material representation upon which
reliance is placed by the U.S. Department of Housing and Urban Development
in awarding the grant. If it is later determined that the grantee
knowingly rendered a false certification, or otherwise violates .the
requirements of the Drug-Free Workplace Act, the U~S. Department of Housing
and Urban Development, in addition to any other remedies available to the
Federal Government, may take action authorized under the Drug-Free
Workplace Act.
CERTIFICATION
A. The grantee certifies that it will provide a drug-free workplace by:
a) Publishing a statement notifying employees that the unlawful
manufacture, distribution, dispensing, possession or use of a
controlled substance is prohibited in the grantee's workplace and
specifying the actions that will be taken against employees for
violation of such prohibition;
b) Establishing a drug-free awareness program to inform employees about:
(!) The dangers of drug abuse in the workplace;
(2) The grantee's policy of maintaining a drug-free workplace;
(3) Any available drug counseling, rehabilitation, and e~oloyee
assistance programs; and
(4) The penalties that may be imposed upon enrployees for drug abuse
violations occurring in the workplace;
c) Making it a requirement that each employee to be engaged in the
performance of the grant be given a copy of the statement required
by paragraph (a); -~'~
d) Notifying the employee in the statement required by paragraph (a)
that, as a condition of employment under the grant, the employee
will:
(1) Abide by the terms of the statement; and
(2) Notify the employer of any criminal drug statute conviction
for a violation occurring in the workplace no ia~er than five
days after such conviction;
-4-
e) Notifying the U.S. Department of Housing and Urban Development within
t0 days after receiving notice under subparagraph (d)(2) from an
employee or otherwise receiving actual notice of such conviction;
f) Taking one of the following actions, within' 30 days of receiving
notice under subparagraph (d)(2), with respect to any employee who
is so convicted:
(1} Taking appropriate personnel action against such an employee,
up to and including, termination; or
(2) Requiring such employee to participate satisfactorily in a drug
abuse assistance or rehabilitation program approved for such
purposes by a Federal, State, or local health, law enforcement,
or other appropriate agency;
g Making a good faith effort to continue to maintain a drug-free
workplace through implementation of paragraphs (a), (b), (c), (d),
(e) and (f).
B. The grantee shall insert in the space provided on the attached "Place of
Performance" form the site(s) for the performance of work to be carried
out with the grant funds (including street address, city, county, state
and zip code). The grantee further certifies that, if it is subsequently
determined that additional sites will be used for the performance of work
under the granS, it shall notify the U.S. Department of Housing~and Urban
Development immediately upon the decision to use such additional sites by
submitting a revised "Place of Performance" form.
-5-
PLACE OF PERFORMANCE
FOR CERTIFICATION REGARDING DRUG-FREE WORKPLACE REQUIREMENTS
Name of Grant City of Bakersfield
Grant Program Name: Community Development Block Grant
Grant Number: B-90-MC-06-0510
Date: May 16, 1990
The grantee shall insert in the space provided below the sites expected to be
used for the performance of work under the grant covered by the certification:
Place of performance (include street address, city, county, state, zip code for
each site):
1. Community Development
515 Truxtun Ave.
Bakersfield, Kern County, CA, 93301
2. Economic Development
515 Tru_xtun Ave.
Bakersfield, Kern County, CA, 93301
3. Fire Deparrnnent
Business Adrministration and Fire Safety Control Divisions
2101 "H" Street
Bakersfield, Kern County, CA, 93301
4. Public Works
Administration and Engineering Divisions
1501Truxtun Ave.
Bakersfield, Kern County, CA, 93301
5. Public Works
Construction Inspection/Survey Division
4101 Truxtun Ave.
Bakersfield, Kern County, CA, 93301
dfl.la
CERTIFICATION REGARDING LOBBYING
The undersigned certifies, to the.best of his or her knowledge and belief, that:
(1) No Federal appropriated'funds have been paid or will be paid, by' or on
behalf of the undersigned, to any person for influencing or attempting to
influence an officer or employee of any agency, a Member of Congress, an officer
or employee of Congress, or an employee of a Member of Congress in.connection
with the awarding of any Federal contract, the making of-any cooperative
agreement, and the extension, continuation, r~newal, amendment, or modification
of any Federal contract, grant, loan, or cooperative agreement.
(2) If any funds other than Federal appropriated funds have been paid or will
be paid to any person for influencing or attempting to influence an officer or
employee of any agency, a Member of congress, an officer or employee of Congress,
or an employee of a Member of Congress in connection with this Federal contract,
grant, loan, or .cooperative agreement, the undersigned shall complete and submit
Standard Form-LLL, "Disclosure form to Report Lobbying," in accordance, with its
instructiOns.
(3) The undersigned shall require that the language of this certification be
included in the award documents for all subawards at all tiers (including sub-
contractors, subgrants, and contracts under grants, loans, and cooperative
agreements) and that all subrecipients shall certify and disclose accordingly.
This certification is a material representation of fact upon which reliance was
placed when this transaction was made or entered into. Submission of this
certification is a prerequisite for making or entering into this transaction
imposed by Section 1352, Title 31, U.S. Code. Any person who fails to file the
required certification shall be subject to civil penalty of not less that
$10,000 and not more than $100,000 for each such failure.
(Signature of Authorized Representative)
Date
LOTTO
CERTIFICATION REGARDING POLICY PROHIBITING USE OF EXCESSIVE~FORCE
In accordance with section 519 of-.Public Law 101-144, (the 1990 HUD'
Appropriations Act), the City of Bakersfield certifies that:
It has adopted and is enforcing a policy prohibiting the. u~e of
excessive force by law enforcement agencies within its jurisdiction
a~gainst any individuals engaged in nonviolent civil rights demon-
s~rations.
NOTE
SUMMARY
1990 CDBG APPLICATION
PROJECTED USE OF FUNDS
FUND 116
ENTITLEMENT 1,201,000
89/90 PROGRAM INCOME 299,000
TOTAL 1,500,000
ADMINISTRATION 651
Administration and Planning $292,177
HOUSING REHABILITATION 652
Direct Delivery Cost $181,636
Housing Loans $200,000
Rehab of Single Family and
Multi-Family Dwellings
Direct Housing $ 75,000
Grants for Handicap Accessibility
Total Sub-Program 652 $456,636.
NEIGHBORHOOD REVITALIZATION 653
Direct Delivery Cost $116,827
Graffitti Removal Program $ 40,000
Fair Housing $ 65,000
Neighborhood Business Revitalization $ 84,360
Program Loans for Special Economic
Development Activities.
Non-Profit Organizations
Alliance against Family $ 70,000
Violence Counseling Center-Acquisition
of property at 2211 17th Street for
an outreach counseling center to
victims of spouse abuse. (Estimated
non CDBG funding is $84,000)
Arthritis Association Adaptive $150,000
Acquatic Center - Construction of a
therapeutic pool, locker room and
administrative office near West-
wind Drive and 19th Street for the
physically impaired/handicapped.
(Estimated non CDBG funding is
$474,000)
Total Sub-Program 653 $526,187
CDBG.APP
~ D2
*CAPITAL IMPROVEMENT PROGRAMS (CIP) 765
Brundage Lane Area Curb & Gutter $ 34,000
Construct infill curb and gutter
improvements in a portion of the area
bounded by Palm Avenue on the north,
"H" Street on the east, Brundage Lane·
on the south and "A" Street on. the
west.
Chester Avenue Area Curb & Gutter $ 39,000
Construct infill curb and gutter
improvements in a portion of the area
bounded by 4th Street on the north,
Chester Avenue on the east, 2nd
Street on the south and "H" Street
on the west.
Kern Street Area Curb & Gutter $ 18,000
Construct infill curb and gutter
improvements in a portion of Kern Street
bounded by Flower Street on the
north and Highway 178 on the south.
Bakersfield Senior Center $ 34,000
Rehabilitation - Roof and heating/
cooling replacement at 530 4th
Street complex (PhaselI).
Jefferson Park Restroom Improvements $ 55,000
Construction of a new 500 sq. ft. + restroom
to replace existing facility which is beyond
repair at the S.E. corner of Bernard and King
Streets.
*Note: Ail CIP projects have direct delivery costs
included in their budgets.
CDBG.APP1
D2
Centr'al Park Concrete Improvements $ 18,000
Installation of approximately 600 i.f. of
walkway and curb and gutter in downtown
Central Park (corner of 19th and R Streets)
to replace delapidated concrete.
Parks Water System Improvements - State Mandated $ 27,000
Installation of state mandated back flow devices
and pumps assemblies for irrigation of Central'
Park (corner of 19th and R Streets) and Jefferson
Park (S.E. corner of Bernard and King Streets).
Total Sub-Program 765 $225,000
Total Ail Programs $1,500,000
CDBG.JP
D2
Community Development Block Grant Budget Summary Program Year 1989-90 16 May 90 ~
Program Year Program Year .
I. Entitlement 1989-90 1990-91
1989-90 CDBG BUDGET ENTITLEMENT $1.261.000
IIIIIIIIIIIII
1990-91CDBG BUDGET ENTITLEMENT //7///7///// SI,201 000
Program Income: $ 325,000$ 299'000
REPROGRAMMED FUNDS FROM PRIOR YEAR 261,404 '
Total Funds Available $i,84~,404 $1~500~000
II. Program BudRet Summary
Sub Programs
651 - Administration & Planning ~ 292,177 19%
652 - Housing Programs & Loans~ 456,636 31%
653 Neighborhood Revitalization 526,187 35%
765 Capital Improvement Projects 225,000 15%
Budget Total $1~500,000 100%
III. Pro,ram Budget Detail
651 - Administration. & Planning $ 292,177
Total Sub-Program 651 $ 292,177
652 - Housing Programs & Loans
Direct Delivery Costs $ 181,636
LoansI 200,000
Handicap Accessibility 75,000
Total Sub-Program 65.2 $ 456,636
653 - Neighborhood Business Revitalization
Direct Delivery Costs ~ 116,827
Graffitti Removal Program~ 40,000
Fair Housing Pro,ram 65,000
Neighborhood Bus~ness Revitalization Loans 84,360
Non-Profit Organizations
Alliance Against Family Violence Counseling'Center ~ 70,000
Arthritis Association Adaptive Aquatic Center$ 150,000
D3RPT5.9
REVISED 04-19-90
Community Development Block ~rant Budget Summary Program Year 1990-91 16 May 90 ~CONTINUED)
Program Year Program Year
III. Entitlement 1989-90 1990-91
Total Sub-Program 653 $ 526,187
765 - Capital Improvements
Curb and Gutter Projects
1. Brundage Lane Area ~C 34,000
2. Chester Avenue Area I 39,000
3. Kern Street Area _ 18,000
Parks Improvement Projects
1. Jefferson Park Restroom Improvements $ 55 000
2. Central Park Concrete Improvements I 18'000
3. Parks Water System Improvements - State mandated 27~000
Public Facility
Bakersfield Senior Center - Phase II $ 34,000
Total Sub-Program 765 $ 225,000
CDBG Pro~ram Budget Total $1~500,000
D2RPT5.9.I
VICE MAYOR REFERRAL
(PROPOSED ORDINANCES ONLY)
DATE OF REFERRAL: April 24, 1990
REFERRED TO: Budget and Finance (John W. Stinson)
ITEM:
(Proposed) An Ordinance of the Council of the City of Bakersfield
Amending Section 5.10.130 of the Bakersfield Municipal
Code Relating to Liability Insurance.
BACKUP MATERIAL ATTACHED: Yes
STATUS:
To Council Committee on
Committee Report No.
Sent to Council on
Public Hearing on
Ordinance Adopted
(date)
Proposed Ordinance Canceled
(date)
Other
cc: Carol Williams
Mary Ellen Gonzales
REFER3-90
JP
· : MEMORANDUM
April 19, 1990
TO: Vice Mayor Ken Peterson
Saalfield, City Attorney
FROM:
Arthur
J.
~w/~' -~~-~
Please refer the following proposed ordinance to whichever
committee you deem appropriate:
1) LIABILITY INSURANCE.
Background: This ordinance updates insurance
requirements for certificate holders for ambulance
businesses. It also adds a requirement that such
certificate holders indemnify the City for claims
and damages arising from works performed by the
-. certificate holders.
Thank you.
AJS/meg
ORD-REFERRAL
LIAB-INS.MEM
Attachment
cc: J. Dale Hawley
Scott Manzer
DRAFT
ORDINANCE NO.
AN ORDINANCE OF THE COUNCIL OF THE
CITY OF BAKERSFIELD AMENDING SECTION
5.10.130 OF THE BAKERSFIELD MUNICIPAL
CODE RELATING TO LIABILITY INSURANCE.
BE IT ORDAINED by the Council of the City of
Bakersfield as follows:
SECTION 1.
Section 5.10.130 of the Bakersfield Municipal Code is
hereby amended to read as follows:
5.10.130 Liability insurance.
A. The certificate holder shall save, hold harmless
and indemnify the City, its officers, agents, employees and
volunteers from all claims, demands, damages, judgments, costs or
expenses in law or equity that may at any time arise from, or be
related to, any work performed by the certificate holder under
the terms of this section.
B. No certificate of public convenience and necessity
shall be issued unless there is on file with the city an
insurance policy approved by the city manager, whereby the owner
and the driver of each of the vehicles described in the
certificate are insured against liability for damage to property
and for injury to or death of any person resulting from the
ownership, operation or other use thereof. The certificate
holder shall have commercial general liability and automobile
liability insurance coverage, providing coverage on an occurrence
basis for bodily injury, including death, of one or more persons,
property damage and personal injury, with limits of not less than
one million ($1,000,000) per occurrence. The liability policy
shall contain an additional insured endorsement in favor of the
city, its mayor, council., officers, agents, employees and
volunteers. The automobile liability policy shall provide
coverage for owned, non-owned and hired autos.
C. The.insurance policy shall contain an endorsement
providing that the policy of insurance will not be cancelled
until notice in writing has been given to the city, addressed to
the City Manager, City Hall, Bakersfield, California, at least
thirty (30) days prior to the time such cancellation becomes
effective.
D. The insurance policy must be issued by a solvent
and responsible company authorized to do business in the state.
The policy shall further provide that there shall be a continuing
liability thereon, notwithstanding any recovery on the policy.
If, at any time, the insurance policy is canCelled by the company
issuing the same, or the authority of said company to do business
in the state shall be revoked, the certificate holder shall
replace the policy with another policy approved by the city
manager.
SECTION 2.
This Ordinance shall be posted in accordance with the
City Charter provisions and shall become effective thirty (30)
days from and after the date of its passage.
- 2 -
I HEREBY CERTIFY that the foregoing Ordinance was
passed and adopted by the Council of the City of Bakersfield at a
regular meeting thereof held on , by the
following vote:
CITY CLERK and Ex Officio Clerk of the
Council of the City of Bakersfield
APPROVED
CLARENCE E. MEDDERS
MAYOR of the City of Bakersfield
APPROVED as to form:
ARTHUR J. SAALFIELD
CITY ATTORNEY of the~City of Bakersfield
LCM/meg
RISKMGMT.ORD
4/19/90
- 3 -
MEMORANDUM
MAY 3, 1990.
TO: BUDGET & FINANC~ COMMITTEE
~ _ jt~ ~ ~ ~ /~ l ~' ~
FROM: SUE WHITFIELD
~ /;
SUBJECT: HEALTH CARE CONSULTANT
On December 13, 1989, the Council approved the City Manager's
Report No. 3-89, directing staff to retain a professional advisor
to assist the City in the implementation of'a multi-year approach
to the health care cost problem, including a review of the
separation of retirees from the active employee contribution
formulas. A request for proposals was sent to the Sher Group,
Advanced Risk Management Techniques (ARMTECH), Wright Insurance
Agents, Gil Howell, and Sedgwick James Company. Proposals were
received from:
- Sher Group.
- Wright Insurance Agents
- Advanced Risk Management Techniques (ARMTECH)
- Sedgwick James Company
Ail the above groups were interviewed with the exception of
Sedgwick James Company, who cancelled their appointment. The
interview panel was made up of:
- Bill Avery - Labor Negotiator
- Gil Rojas - Assistant Finance Director
- John Stinson - Assistant to the City Manager
- Sue Whitfield - Personnel Manager
Based upon a review of the proposals and an extensive interview
with each of the consultants, the interview panel recommends the
Sher Group. With the Council's approval, Mr. Sher will perform
the services under "Scope of Work" in the attached Agreement.
The compensation for these services will consist of monthly
payments upon the submission of an invoice, for a total payment
not to exceed $20,000 for a period not exceed 6 months:.
klc
4:BFC1
I J A.Iq ~, 0
I PERSONNEL OFFICE
!
!
CITY OF BAKERSFIELD
I PROPOSAL FOR PROFESSIONAL SERVICES
SHER GROUP
100 First Street, Suite 1035
San Francisco, CA. 94105
.January 26, 1990
Il
I
Il
I
1
I SHER GROUP
City of Bakersfield
Proposal for Professional Services
I
I Proposal Outline
1. What Sher Group Believes Must Be Done.
I
I 2. The Approach Sher Group Will Use to Working with the
City of Bakersfield.
!l 3. References.
4. Proposed Timing of Work and Fee Schedule.
I
,1
I
I -
SHER GROUP
'" . ..- City of Bakersfield
..'.Proposal for Professional Services
1. What Sher Group Believes Must Be Done.
The City of Bakersfield needs to take a fresh look at the assumptions upon
which are based its ~roup health and dental benefit plans. There is a strong
case to be made for ~eturning to the basic principles of ~oup health
insurance underwriting. This approach would place all active and retired
employees in one plan which, ideally, would be able to offer both HMO and
some sort of Fee-for-Service benefits. This is a simple, elegant way of
addressing the vexing problems now facing the City.
Covering alt City health plan beneficiaries under one conn'act would permit
broad spread of risk and more equitably distribute the expense of retiree
health care coverage.
Retired and active employee coverage should incorporate some cost-sharing
at point of service. This would re-allocate the cost of covering small claims
from premium, which everyone pays, to small per-visit co-payments by
those who use the most physician services. Such change would
dramatically reduce the rate of increase in premiums thereby freeing money
for other forms of compensation.
Finally, both management and labor need to recognize that the health care
cost problem is not going to go away. Any proposed solution must be
examined for its range of possible outcomes over the next three ),ears.
Procedures. reports, management practices and personnel must be put in
place to assure consistent year-to-year direction of the City of Bakersfield's
~oup benefit plans.
3
SHER GROUP.
" City of Bakersfield
Proposal for Professional Services
2. The Approach .Sher Group Will Use to Working with /he
City of Bakersfield.
Sher Group works to assist the process of decision-making which leads to
effective benefit plan governance and management. We are as much
interested in the process of decision-making as the result of deliberations.
.~ We believe that a properly structured decision-making process leads to a
' well-thought-out consensus which generates good results.
Sher Group will, in conjunction with your Committee, work on a two phase
project:
pHASE ONE
A. Analyze data.
Analysis of enrollment, claims, income, administrative procedures, and plan
management practices are all part of understanding the status quo.
Establishment of regular, standardized reporting formats is vital to month-
to-month review of operating results and for strategic planning.
B. Educate decision-makers about the status q~)o and the results of
maintaining the status quo.
The basis of effective decision-making is a clear understanding of the status
quo and where things are going if nothing changes. Wi~ will describe for
the City of Bakersfield, based on Our experience and the City's recent plan
history., the consequences over the next two to three years o( continuing '
with plans and policies in-force today.
C. Presem alternatives to the status quo.
Rapid change in the ~Oup health environment requires flexibility and
creatMty in administrative practice and plan design. If the City does not
adapt to change', plans offered by the City will no longer meet'the needs of .
its retirees and employees. 'Regular, thorough review of alternatives to the
status quo must be performed. Administrative assumptions Such as stability
'of enrollment, rates of utilization, inflation, and so forth must be questioned
or subjected to analysis.
While benefit plans are complex, there are only four variables that ma)' be
modified. Sher Group is expert at making clear, the trade-offs involved in
changing these variables:
Benefits- what are the levels of coverage and types of ser~4ces covered?
Access- from whom beneficiaries receive care?
may
Price- how much of the cost does the employee or the employer pay?
Eligibility- who will be offered coverage?
City of Bakersfield
Proposal for Professional Services
2. The Approach Sher Group Will Use (continued).
D. Facilitate discussion of alternatives presented.
Pros and cons of alternatives must be discussed openly. As a professional
advisor, Sher Group will recommend solutions, but the ultimate
responsibility for decision-making rests with the Committee and the City
Council. We are veT good at guiding our clients from discussion of
alternatives to development of consensus for action while addressing
positive and negative consequences of alternatives.
E. Develop a three-year business plan.
The City must operate its health plans like a business. The
City
provides
coverage to employees and retirees who depend on City decision makers to
develop and maintain competitive and cost-effective benefit plans. In
California's rapidly changing health care environment, short-term decision-
making which fails to consider longer-term consequences - such as occurred
in 1989 - will lead inexorably to disaster. Sher Group will help City
develop a three-year business plan which should be re,,,iewed annuallv.
PHASE TWO
F. Negotiate with insurance carders or other vendors as required to
implement changes proposed.
Sher Group and Sher Company Insurance Services provide professional
advice to nearly one hundred California employers whose employees are
J
enrolled in plans offered by forty different carriers. We have a long and
successful record of pragmatic .negotiations and effective results with the
City's' carriers: Blue Cross and HealthNet. We will negotiate with carriers
in a manner acceptable to City decision makers with consideration that long-
run stability is generally preferable to short-term winner-take-all outcomes.
1'
G. Perform other ,services as re°uired.
Unlike larger fzrms we are very flexible and provide personal service. It is
impossible in two Pages to summarize all the tasks we have performed in
the past or may be asked to'undertake in the future. We have 'assisted in
design of communications materials, held seminars for employees,
developed requests for proposal for various products and services, analvzed
those proposals, and accomplished many other tasks. If we can perforrh a
task competently, within the budget allocation, we ,.*.'ill do it well. If we
can't do it, we'll find someone who will.
City of Bakersfield
Proposal for Professional Services
3. References .
Mr. Wesley L. Apker, Ed.D.
Executive Director
Association of California School Administrators
1517 L Street
Sacramento, CA 95814
1-(916)-444-3216
Mr. John P. Fraser
Executive Director and General Counsel
Association of California Water Agencies
910 K Street, Suite 250
Sacramento, CA 95814-3577
1-(916)-441-4545
Mr. Earl G. Eckert
Personnel Director
Butte County
County Administration Building
25 County Center
Oroville, CA 95965-3387
1-(916)-538-7651
Mr. John Worcester
Personnel Services Manager
City of Sacramento
921 Tenth Street, 2nd Floor
Sacramento, CA 95814-2693
I-(916)-449-5726
)
SHER G~OU~'
City of Bakersfield
Proposal for Professional Services
4. Proposed Timing of Work and Fee Schedule.
Timing
Phase One
.. This should take four to five months depending on the frequency of
Committee meetings and the Committee's ability to digest information. The
most important part of the process in Phase One is consensus building in
support of long-term strategy. If divisions between members of the
Committee are great or if solutions are controversial Phase One may take
more than 4-5-months. We recommend one meeting per month in this
phase. This is the hard part.
Phase Two
This will include implementation and maintenance of the plans developed in
Phase One and will be of indeterminate duration.
Fee Schedule
Sher Group's proposed fee schedule is based on a combination of a
· minimum monthly fee and actual hours worked.
Phase One:
1. A Minimum Monthly Fee will be billed at $3000 per month and will be
the least amount payable to Sher Group for any month.
2. A Maximum Monthly Fee of $4000 will be set.
3. Sher Group will track actual hours worked on City business at a rate of
$190/hour for principals, $90/hour for account executives and $60/hour
for support staff. If, f.37harees based on actual hours worked exceed the
Minimum Monthly Fe_e_,_S__her Groul~ will bill the City 1or the differ--r~rrce
between the Minimum Monthly Fee and the MaXimum Monthly Fee. -
4. Sher Group will pay all of its own expenses for travel, lodging, and routine office support services.
P hax e Two:
We propose to negotiate with the City an arrangement similar to that of
Phase One, possibly at different rates.
We believe the proposed fee schedule is extremely reasonable. It is based
on Sher group's intimate understanding of how complicated cities can be.
If Phase One is carried out over five month,s, will cost the Cit~ at most
$20,000. This fi~m. tre represents about one-half of one per. cent of the City's
19-Sr)-b~nefit expenditures of $3.8 million.
.7
~HER G~OUP
AGREEMENT NO.
CONSULTANT'S AGREEMENT
THIS AGREEMENT, is made and entered into on ,
by and between the CITY OF BAKERSFIELD, a municipal corporation,
referred to herein as "CITY" and THE SPr~.R GROUP, referred to herein
as "CONSULTANT".
RECITALS
W~MREAS, the CITY OF BAKERSFIELD issued a Request for
Proposals and CONSULTANT has submitted a proposal concerning
health care analysis; and
WHEREAS, CONSULTANT is experienced and well qualified in
analysis of health care services; and
WHEREAS, the CITY does not have expertise currently on
staff to perform analysis, recommend,.and implement a multi-year
approach to controlling health care costs for active employees and
retirees; and
WHEREAS, CONSULTANT is aware that information may come
into CONSULTANT's possession which may impact the CITY's legal
position in the event such information was released to outside
parties; and
WHEREAS, CITY now desires to employ CONSULTANT to:
a) analyze data, present alternatives to our status quo
health system;
b) facilitate discussion of alternatives presented; and
c) develop a three-year business plan as set forth herein~
NOW, THEREFORE, CITY and CONSULTANT mutually agree as
follows:
1. SCOPE OF WORK. The scope of work is generally described
as a review and analysis of CITY medical and dental benefit plans
for active and retired employees; consultative meetings
approximately once each month with CITY staff, CITY's negotiator,
the joint CITy/employee insurance committee, employees and retirees
of CITY; preparation of meeting materials and research necessary
to facilitate such consultative meetings; recommendation of changes
to current benefit plans; if necessary, preparation of reqn~ests for
proposal from alternate health and dental benefit vendors; analysis
of proposals received and presentation of comparisons between in-
force and proposed programs to various City groups. Written
reports in support of the tasks listed shall be as mutually agreed
upon between the consultant and the CITY and shall include a
summary report to the CITY by November 30 or by such date as shall
.be agreed upon between the City and the consultant. CONSULTANT's
engagement shall begin on May 21, 199.0, and~ shall terminate on
November 30, 1990, unless extended at the sole discretion of the
CITY at terms to be mutually agreed upon. The scope of work shall
include all items contained in CONSULTANT'S Proposal and CITY's
Request for Proposals. CONSULTANT'S Proposal and CITY's Request
for Proposals are set forth in Exhibit "A", and incorporated herein
by reference as though fully set forth. CONSULTANT's services will
include all the procedures necessary to properly complete the task
CONSULTANT has been hired to perform whether specifically included
in the scope of work or not.
2. COOPERATION. Upon request CITY and its officers and
employees shall provide necessary information not available to
CONSULTANT from other, sources to CONSULTANT as required to perform
the services described herein and in accordance with the scope of
work set forth above.
3o COMPENSATION. Compensation for services under paragraph
1 shall be computed as set forth in the fee schedule for Phase One
described in paragraph 4 of the CONSULTANT's proposal and shall
consist of monthly payments upon invoice for a total payment not
to exceed TWENTY THOUSAND DOLLARS ($20,000).
The compensation set forth in this paragraph shall be the
total compensation for the services provided by CONSULTANT
including all out-of-pocket cost incurred by the CONSULTANT. CITY
shall pay no fee other than the compensation listed in this
paragraph unless otherwise agreed to in writing by the CITY and
CONSULTANT.
4~ PAYMENT PROCEDURE. CONSULTANT shall be paid for services
rendered after receipt of an itemized invoice for the work
completed and approved by CITY in accordance with the terms of this
agreement. Payment by CITY to CONSULTANT shall be made within
forty-five (45) days after receipt and approval by CITY of
CONSULTANT's itemized invoice.
5. TITLE TO DOCUMENTS. All documents, plans, and drawings,
maps, photographs, and other papers, or copies thereof prepared by
CONSULTANT pursuant to the terms of this agreement, shall, upon
preparation, become the property of the CITY.
6. CONFIDENTIALITY. During the term of this agreement,
CONSULTANT will be dealing with information of a legal, and
confidential nature, and such information could severely damage
- 2 -
CITY in the event any of said information was disclosed to outside
parties. CONSULTANT will not disclose to anyone, directly or
indirectly, either during the term of this agreement or at any time
thereafter, any such information or use such information other than
as necessary in the course of services provided to the CITY under
this agreement. All documents that CONSULTANT prepares and
confidential information that might be given to CONSULTANT in the
course of providing services under this agreement are the exclusive
property of the CITY and shall remain in the CITY's possession.
Under no circumstances shall any such information or documents be
removed from the CITY without the CITY's written consent first
being obtained.
7. BEST EFFORTS. CONSULTANT is preparing a work product at
the request of the CITY. All work done under this Agreement will
be on a best efforts basis. CONSULTANT agrees to dedicate the
necessary personnel and time to carry out the work as proposed.
In the event that litigation is commenced involving the
work product of CONSULTANT, CONSULTANT will, at the request of the
CITY, assist the CITY in that litigation. Should such litigation
demonstrate that CONSULTANT was negligent or committed misfeasance
or malfeasance in preparation of the Study, or used patented,
copyrighted or proprietary information without full legal authority
to do so, no added compensation shall be due for providing such
assistance.
8. NEWS RELEASES/INTERVIEWS. All consultant and
subconsultant/subcontractor news releases, media interviews,
testimony at hearings and public comment shall be prohibited unless
expressly authorized by the Contract Administrator.
9. WAIVE~ OF DEFAULT. The failure of any party to enforce
against another a provision of this Agreement shall not constitute
a waiver of that party's right to enforce such a provision at a
later time, and shall not serve to vary the terms of this
Agreement.
10. FORUM. Any lawsuit pertaining to any matter arising-
under, or growing out of, this contract shall be instituted in Kern
County, California.
- 3 -
11. NOTICES. All notices relative to this Agreement shall
be given in writing and shall be sent by certified or registered
mail and be effective upon depositing in the United States mail.
The parties shall be addressed as follows, or at any other address
designated by notice:
CITY: CITY OF BAKERSFIELD
CITY HALL
1501 Truxtun Avenue
Bakersfield, California 93301
CONSULTANT:. THOMAS S. Sw~R
SF~R GROUP
100 First Street' Suite 1035
San Francisco, California 94105
12. ASSIGNMENT. This contract shall not be assigned by any
party, or any party substituted, without prior written consent of
all the parties.
13. BINDING EFFECT. The rights and obligations of this
Agreement shall inure to the benefit of, and be binding upon, the
parties to the contract and their heirs, administrators, executors,
personal representatives, successors and assigns.
14. ATTORNEY'S FEES. In any action to enforce the terms of
this Agreement, the prevailing party shall be entitled to recover
its attorney's fees and court costs and other nonreimbursable
litigation expenses, such as expert witness fees and investigation
expenses, whether or not such action proceeds to judgment.
15. MERGER AND MODIFICATION. This contract sets forth the
entire Agreement between the parties and supersedes all other oral
or written representations. This contract may be modified only in
a writing approved by the City Council and signed by all the
parties. In the event of a conflict'between the terms, conditions
or specifications set forth herein and those in Exhibits attached
hereto, the terms, conditions or specifications set forth in this
agreement (and not the exhibits) shall prevail.
16. CORPORATE AUTHORITY. Each individual executing this
Agreement represents and warrants that they are duly authorized to
execute and deliver this Agreement on behalf of the corporation or
organization named herein and that this Agreement is binding upon
said corporation or organization in accordance with its terms.
- 4 -
17. TERMINATION. This agreement may be terminated by any
party upon thirty (30) days written notice to all other parties.
In the event of termination, CONSULTANT shall be paid for the work
completed to the satisfaction of CITY up to the date of notice of
termination. Upon termination, CONSULTANT shall deliver all
materials relative to the Study to the CITY.
18. COMPLIANCE WIT~ ALL LAWS. CONSULTANT shall, at
CONSULTANT's sole cost, comply'with ~11 of the requirements of
Municipal, State, and Federal authorities now in force, or which
may hereafter be in force, pertaining to this Agreement, and shall
faithfully observe in all activities relating to or growing out of
this Agreement all Municipal ordinances and State and Federal
statutes, rules or regulations now in force or which may hereafter~
be in force.
19. INDEPENDENT CONTRACTOR. This Agreement calls for the
performance of the services of CONSULTANT as an independent
contractor, and CONSULTANT will not be considered an employee of
the CITY for any purpose and is not entitled to any of the benefits
provided by CITY to its employees. This Agreement shall not be
construed as forming a partnership or any other association with
CONSULTANT other than that of an independent contractor.
20. INSURANCE. In addition to any other form of insurance
or bond required under the terms of this Agreement, the CONSULTANT
shall procure and maintain for the duration of this Agreement the
following types and limits of insurance:
a. Professional liability insurance, providing
coverage on an occurrence basis for errors and
omissions with limits of not less than one
million ($1,000,000) per occurrence; and
b. Automobile liability insurance, providing
coverage on an occurrence basis for bodily
injury, including death, of one or more
persons, property damage and personal injury,
with limits of not less than one million
($1,000,000) per.occurrence; and
c. Broad form commercial general liability
insurance, providing coverage on an occurrence
basis for bodily injury, including death, of
one or more persons, ProPerty damage and
personal injury, with limits of not less than
one million ($1,000,000) per occurrence.
- 5 -
d. Workers' compensation with statutory limits
and employer's liability insurance with limits
of not less than one million ($1,000,000) 'per
accident.
Except for professional liability, all policies required
of the CONSULTANT hereunder shall be primary insurance as respects
the CITY, its mayor, council, officers, agents, employees and
volunteers and any insurance or self-insurance maintained by the
CITY, its mayor, council, officers, agents, employees and
volunteers shall be excess of the CONSULTANT's insurance and shall
not contribute with it.
The automobile liability policies shall provide coverage
for owned, non-owned and hired autos.
The liability policies shall provide contractual
liability coverage for the terms of this Agreement.
Except for professional liability, the liability policies
shall contain an additional insured endorsement in favor of the
CITY, its mayor, council, officers, agents, employees and
volunteers.
The workers' compensation policy shall contain a waiver
of subrogation endorsement in favor of the CITY, its mayor,
council, officers, agents, employees and volunteers.
All policies shall contain the following endorsement:
An endorsement providing the CITY with ten (10) days written notice
of cancellation or material change in policy language or terms.
If any part of the work under this Agreement is sublet,
similar insurance shall be provided by or on behalf of the
subcontractors to cover their operations. The insurance required
under this Agreement shall be maintained until all work required
to be performed under the terms of this Agreement is satisfactorily
completed as evidenced by formal acceptance by the CITY.
The CONSULTANT shall furnish the City Risk Manager with
a certificate of insurance evidencing the insurance required under
this Agreement.
21. INDEMNITY. CONSULTANT shall' indemnify, defend, and hold
harmless CITY_, its officers, agents and employees against any and
all liability, claims, actions, causes of action or demands
whatsoever against them; or any of them, for injury to or death of
persons or damage to property arising out of, connected with, or
caused by CONSULTANT, CONSULTANT's employees, agents or independent
contractors or companies in the performance of (or in any way
arising from) the terms and provisions~of this Agreement.
-- 6
22. EXECUTION. This Agreement is effective upon execution.
It is the product of ~negotiation and therefore shall not be
construed against any party.
23. CONTRACT ADMINISTRATOR. The Contract Administrator for
the CITY is:
Ms. Sue Whitfield
Personnel Manager
City of Bakersfield
1501 Truxtun Avenue
Bakersfield, California 93301
(805) 326-3789
CONSULTANT's project manager shall be:
Mr. Thomas S. Sher
Sher Group
100 First Street Suite 1035
San Francisco, California 94105
The Contract Administrator and the Project Manager shall be
the primary contact persons for CITY and CONSULTANT. It is
expressly understood that only the CITY may approve modifications
to the contract, which modifications must be in writing.
24. ACCOUNTING RECORDS. CONSULTANT shall maintain accurate
accounting records and other written documentation pertaining to
the costs incurred in performance of this Agreement. Such records
and documentation shall be kept at CONSULTANT's office during the
period of this Agreement, and after the term of this agreement for
a period of three years from the date of the final payment under
this Agreement, and shall be made available to CITY representatives
upon request at any time during regular business hours.
25. CONFLICT OF INTEREST. CONSULTANT 'stipulates that
corporately or individually, the firm, its employees and
subconsultants have no financial interest in either the success or
failure of any project which is dependent on the. results of the
studies prepared under this agreement.
26. TAX NUMBERS.
CONSULT~/~T's Federal Tax ID Number
CONSULTANT is a corporation? Yes X No
(Please check one.)
o0o-
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed, the day and year first-above written.
"CITY"
CITY OF BJ~KF_~SFIELD
By
CLARENCE E. MEDDERS
Mayor
APPROVED AS TO FORM:
ARTHUR J. SAALFIELD
City Attorney
~ By
COUNTERSIGNED:
By
GREGORY KLIMKO
Finance Director
"CONSULTANT"
THE SF~R GROUP
By
Title
LCM/ADD/meg/lg
SHER.K
04/26/90
Attachment
~xhibit "A"
- 8 -
SHER GROUP $20,000 6 Months
They pay all of their
travel expenses, logding
and routine office supplies.
Wright Insurance $20,000 - $24,000 12 Months
Agents On Site and Travel Time -
$100 Hour
ARMTECH $16,000 - $20,000 6 Months
Fees to increase in 1990,
but not more than 10%.
Travel, Telephone, etc.
(expenses) - 15 - 20%
Sedgwick James $30,000 - $42,000 Based on 200-
Company 300 Hours