Staff Report.NUMU Lease Amendment
PREPARED BY: Arn Andrews
Assistant Town Manager
Reviewed by: Town Manager, Town Attorney, and Finance Director
110 E. Main Street Los Gatos, CA 95030 ● (408) 354-6832
www.losgatosca.gov
TOWN OF LOS GATOS
COUNCIL AGENDA REPORT
MEETING DATE: 06/28/2022 ITEM NO: 2
DATE: June 23, 2022
TO: Mayor and Town Council
FROM: Laurel Prevetti, Town Manager
SUBJECT: Authorize the Town Manager to Execute a Second Amendment to the Lease
Agreement with Los Gatos Museum Association (LGMA) to Extend the
Council Consideration Date in Section 7.2 of the First Amendment.
RECOMMENDATION:
Authorize the Town Manager to execute a second amendment to the lease agreement with Los
Gatos Museum Association (LGMA) to extend the Council consideration date in Section 7.2 of
the First Amendment.
BACKGROUND:
On April 21, 2020, the Town Council approved a First Amendment to the Lease Agreement with
LGMA (Attachment 1), also known as New Museum Los Gatos (NUMU), to minimize and/or
eliminate utility and rent obligations. In exchange for the elimination of utility payments and
outstanding obligations, NUMU was willing to accelerate rent payments, provide in-kind
services for residents of Los Gatos, and reconfigure the lower level of their staff office area for
use by Town employees.
DISCUSSION:
The First Amendment included the following stipulation in Section 7.2 of the Agreement:
7.2 Past Utilities Due. Lessee acknowledges that pursuant to the terms of the Lease
before this Amendment, that there is due and owing to the Town the sum of $24,417.58
for utilities and operating expenses under this Paragraph. If Lessee performs
satisfactorily pursuant to the Agreement and this Amendment, Town Council, in its own
and sole discretion, shall consider, prior to July 2022, whether to waive the amount past
due. Until such time as Council makes a determination, no amount shall be due from the
PAGE 2 OF 2 SUBJECT: 2nd Amendment NUMU Lease Agreement DATE: June 23, 2022
DISCUSSION (continued):
Lessee to the Town for the above referenced amount.
Due to the adverse effects on NUMU’s operations associated with COVID-19 health mitigation
restrictions, it is not practical at this time for Council to ascertain “If Lessee performs
satisfactorily” under this Section. As such, staff recommends amending the agreement and
extending the consideration period to prior to July 2024 (Attachment 2).
CONCLUSION:
Execution of the Second Amendment will provide Council sufficient time to determine if NUMU
has meet its obligations under Section 7.2 and if the outstanding sum of $24,417.58 should be
waived.
FISCAL IMPACT:
None.
ENVIRONMENTAL ASSESSMENT:
This is not a project defined under CEQA, and no further action is required.
Attachments:
1. First Amendment
2. Draft Second Amendment