05 Staff Report - Animal Control and City Regarding Purchase of Thomas Road Property
DATE: TO: FROM: COUNCIL AGENDA REPORT MARCH 25, 2004 DEBRA J. FIGONE, TOWN MANAGER :MEETING DATE: 04/05/04 ITEM NO. S SUBJECT: AUTHORIZE AGREEMENT
AMONG TI;IE VALLEY ANIMAL CONTROL AUTHORITY AND ITS MEMBER CITIES REGARDING PURCHASE OF THOMAS ROAD PROPERTY /' ., i : RECOMMENDATION: Authorize agreement
among the Silicon Valley Animal Control Authority ana. its member cities regarding purchase of Thomas Road property. ' BACKGROUND: Council voted on January 5, 2004 to proceed with contract
negotiations with the City of San Jose for animal control service and approved withdrawing from the Joint Exercise ofPowers Agreement effective June 30, 2004. Since that time, the remaining
cities; Santa Clara, Campbell, and Monte Sereno have continued to proceed as a Joint Powers. DISCUSSION: The remaining cities in the Joint Exercise ofPowers Agreement; Santa Clara, Campbell,
and Monte Sereno, are proceeding with the purchase ofthe Thomas Road property for the animal shelter site. This agreement establishes an arrangement for the remaining cities to purchase
the property and ensures that. no funds from the withdrawing cities (Los Gatos, Saratoga and Cupertino), are encumbered or used in the property transaction. It also states that individually,
and as a group, the withdrawing cities release any right, title, interest or entitlement of any kind in the property. CONCLUSION: Staff supports this agreement and recommends council
approval. PREPARED BY: Scott R. Seaman 4 d1 J /Chief of Police --(!jjJCf' I Reviewed by: -e.s..:s.Assistant Town Manager rs't-Yown Atto;mey __Clerk,--_Finance __Community
Development Revised: 3/29/04 10:16 am Reformatted: 5/30/02
PAGE 2 MAYORAND TOWN COUNCIL SUBJECT: March 25, 2004 ENVIRONMENTAL ASSESSMENT: This is not a project defined under CEQA, and no further action is required. FISCAL II\1PACT: None. Attachments:
1) Purchase Agreement for Thomas Road property 2) Board ofDirectors Agenda Item #12 3) Section 8.1 -Joint Powers Agreement Distribution: General
AGREEMENT AMONG SVACAAND ITS MEMBER CITIES REGARDING PURCHASE OF THOMAS ROAD PROPERTY This Agreement is entered into among the Silicon Valley Animal Control Authority ("SVACA") and its
member Agencies, Santa Clara, Campbell, Cupertino, Los Gatos, Saratoga and Monte Sereno, on the dates hereafter indicated. WHEREAS, SVACA and its current six Member Agency cities approved
and executed the Second Restated and Amended Joint Exercise ofPowers Agreement Creating the Silicon Valley Animal Control Authority in October and November of2003 ("Joint Powers Agreement");
and WHEREAS, three Member Agencies, Cupertino, Los Gatos and Saratoga, have given notice to SVACA oftheir intent to withdraw from SVACA as ofJune 30, 2004 ("Withdrawing Cities"); and
WHEREAS, three Member Agencies, Santa Clara, Campbell and ·Monte Sereno, have elected to remain in SVACA and to carry out its mission, includingthe construction ofan animal shelter ("Continuing
Cities"); and WHEREAS, SVACA's Operating Budget for FY 03-04 ("Budget") excluded capital expenditures related to the animal shelter as some Member Agencies were weighing their longterm
participation.in SVACA when the Budget was developed; and WHEREAS, SVACA is in contract to purchase 3370 Thomas Road ("Property") for its animal shelter but SVACA does not have sufficient
funds to cover said purchase based on the agreed upon contributions from Member Agencies to support the Budget; and WHEREAS, the Continuing Cities desire to establish an arrangement
to purchase the Property which ensures that no contributions or funds from the Withdrawing Cities are encumbered or used in the Property transaction; and WHEREAS, the Withdrawing Cities
recognize their obligation under Section 8.1 ofthe Joint Powers Agreement not to affect the ability ofSVACA and the Continuing Cities to carry out and fulfill the purposes ofSVACA; and
WHEREAS,in order to achieve these objectives, SVACA and its current Member Agencies have agreed to proceed with the purchase ofthe Property in accordance with the terms and conditions
set forth below. NOW, THEREFORE, THE PARTIES AGREE As FOLLOWS: 1. The Continuing Cities will arrange among themselves to tender sufficient funding to SVACA to cover the full purchase
price ofthe Property in the amount of $2,450,000, plus any amounts that may' be needed to cover transactional costs ofthe Property acquisition ("Payment"). 1 ATTACHMENT 1 1091781.1
The Payment will be provided to SVACA in a timely manner s:uch that SVACA can meet its fmancial obligatioIis under the Purchase Agreement for the Property. 2. SVACA will place $100,000
ofthe Payment from the Continuing Cities in its current operations reserve account to reimburse SVACA for the $100,000 now on deposit in escrow forthe Property:;md previously paid out
ofSVACA's operations reserve. SVACA will place the balance oftlle Payment from the Continuing Cities in a separate and segregated account for the purchase ofthe Property. SVACA will
only use funding from this segregated account to cover anY and all financial obligations, related to and necessary for the acquisition of the Property. . 3. . SVACA shall maintain a
complete and accurate accounting ofthe funding received from the Continuing Cities pursuant to this agreement and the manner in which the fu.ndingin the segregated account for the Property
acquisition is expended. 4. Upon consummation ofthe Property acquisition, SVACA shall hold title to the Property, as contemplated by the Purchase Agreement for the Property. 5. The Withdrawing
Cities, individually.and as a group, hereby release, relinquish, discharge and forever disclaim any right, title, interest or entitlement ofany kind in the Property. IN WITNESS WHEREOF,
the parties hereto have caused this Agreement to be executed andattested by their proper officers thereupon duly authorized and their official seals to be hereto affixed on the dates
as shown herein. MEMBER AGENCIES APPROVED AS TO FORM: By: Its: Date: _ ATTEST: By: Its: Date: -----CITY OF CAMPBELL, a municipal corporation· By: Its; Date: ---------------2 1091781.1
, /'---.../APPROVED AS TO FORM: . By:. Its: Date: _ ATTEST: By: Its: Date: ----',-_ APPROVED AS TO FORM: By: Its: Date: _ ATTEST: By: Its: Date: __-'--_ APPROVED AS TO FORM: By: Its:
Date: "'----,-ATTEST: By: Its: Date: _ CITY OF CUPERTINO, a municipal corporation By: Its; Date: _ CITY OF MONTE SERENO, a municipal corporation By: Its; Date: -'--_ CITY OF SANTA CLARA,
a municipal corporation By: Its; Date: --------------3 1091781.1
APPROVED AS TO FORM: By: . Its: Date: _ ATTEST: By: Its: Date: _ APPROVED AS TO FORM: By: Its: Date: _ ATTEST: By: Its: Date: _ CITY OF LOS GATOS, a municipal corporation By: Its; Date:
_ CITY OF SARATOGA, a municipal corporation By: Its; Date: _ 4 1091781.1
SILICON VALLEY ANIMAL CONTROL AUTHORITY AGENDA ITEM No.12 Meeting Date: 3/22/2004 ITEM! /Agreement Among SVACA and Its Member Cities Regarding Purchase of Thomas
Road Property RECOMMENDED MOTION That the Board of Directors approve the Agreement Among SVACA and Its Member Cities Regarding Purchase of Thomas Road Property DISCUSSION TAC representatives
from the three remaining SVACA city members, SVACA legal counsel and staff met on March 4,2004 to discuss the manner in which SVACA can proceed with the purchase of the Thomas Road property
without impacting the current year's budget. The attached agreement establishes an arrangement to purchase the Property which ensures that no contributions or funds from the Withdrawing
Cities are· encumbered or used in the Property transaction. The agreement was written by legal counsel with input from the TAC members and staff. Withdrawing Cities recognize
their obligatIon under Section 8.1 (see attachment) of the Joint Powers Agreement not to affect the ability of SVACA and the continuing Cities to carry out and fulfill the purposes of
SVACA. At the same time, the Continuing Cities desire to purchase the Thomas Road property in a manner that keeps faith with the understanding that the Withdrawing Cities will not be
required to contribute funds toward the capital improvement expenditures for the animal shelter. In order to carry out these objectives, SVACA and its current Member Agencies would agree
to proceed with the purchase of the Property in accordance with the following: 1. The Continuing Cities will arrange among themselves to tender sufficient funding to SVACA to cover the
full purchase price of the Property in the amount of $2,450,000, plus any amounts that may be needed to cover transactional costs of the Property acquisition ("Payment"). The Payment
will be provided to SVACA in a timely manner such that SVACA can meet its financial obligations under the Purchase Agreement for the Property. ATTACHMENT 2 1092879.3
SILICON VALLEY ANIMAL CONTROL AUTHORITY Page 2 AGENDA REPORT March 22, 2004 2. SVACA will place $100,000 of the Payment from the Continuing Cities in its current operations reserve account
to reimburse SVACA for the $100,000 now on deposit in escrow for the Property and previously paid out of SVACA's operations reserve. SVACA will place the balance of the Payment from
the Continuing Cities in a separate and segregated account for the purchase of the Property. SVACA will only use funding from this segregated account to cover any all financial
obligations related to and necessary for the acquisition of the Property. 3. SVACA shall maintain a complete and accurate-accounting of the funding received from the Continuing Cities
pursuant to this agreement and the manner in which the funding in the segregated account for the Property acquisition is expended. 4. Upon consummation of the Property acquisition, SVACA
shall hold title to the Property, as contemplated. by the Purchase Agreement for the Property. 5. The Withdrawing Cities, individually and as a group, hereby release, relinquish, diSCharge
and forever disclaim any right, title, interest or entitlement of any kind in the Property. . SVACA legal counsel has distributed the Agreement to th,e City Attorneys of all of the Member
Agencies for revieW and comment. . CONCLUSION Staff believes that this agreement benefits all of the parties by clarifying the financial responsibility of the Continuing Cities for the
purchase of the Thomas Road property and releasing the Withdrawing Cities from anyresponsibHity for or interestlemtitlement in this property. Finally, the agreement ehsures that the
current year budget will not be impacted by the capital expenditures for purchase of the Property. DOCUMENTS ATTACHED Agreement Among SVACAand Its Member Cities Regarding Purchase of
Thomas Road Property . Section 8.1 of the Joint Powers Authority Agreement 1092879.3
SILICON VALLEY ANIMAL CONTROL AUTHORITY Page 3 FISCAL IMPACT AGENDA REPORT March 22, 2004 SVACA's current operations reserve account will increase by the $100,000 Payment from the ContinUIng
Cities to reimburse SVACA for the $100,000 now on deposit in escrow for the Property. 1092879.3
set forth in this Agreement. The Member Agencies acknowledge and agree that the contributions required pursuant to Section 6.3 of a Member Agency that enters into such a contract with
the Authority may be modified accordingly, with the approval ofthe Board ofDirectors, to account for the greater or lesser level of service being provided to that Member Agency by the
Authority. Member Agencies requesting other animal related services from the Authority in addition to those Animal Control Services specified in Exhibit "A" of this Agreement shall be
held financially responsible for direct additional costs incurred. or encumbered by the Authority in the implementation of special programs, projects, and services. ARTICLE VII ENFORCEMENT
Section 7.1. Reserved. Section 7.2. Enforcement byAuthority. The Authority is hereby authorized to take any or all legal or equitable actions, including but not limited to injunction
and specific performance, necessary or permitted by law, to enforce this Agreement. ARTICLE VIII WITHDRAWAL OF A MEMBER AGENCY Section 8.1. Agreement Continues. Notwithstanding the provisions
ofSection 9.1, each Member Agency agrees that the withdrawal ofa Member Agency pursuant to this Article VITI is notintended to and will not terminate this Agreement or affect the ability
of the Board of Directors or the remaining Member Agencies to carry out and fulfill the purposes ofthis Agreement. Section 8.2. Withdrawal. A Member Agency may withdraw from the Authority
and Agreement byfiling written notice thereofwith the Authority. Withdrawal will take effect on July 1 of any year provided there is a least six months advance notice. The withdrawal
of any Member Agency from the Authority shall in no way affect the rightsand obligations ofthe remainingMember Agencies. A withdrawing Member Agency is still obligated for all payments
due from it for the fiscal year of the withdrawal. Further, in the event of withdrawal of a Member Agency, the following terms and conditions will apply: Section 8.2.1. Withdrawal shall
not relieve the party ofits proportionate share ofany debts, liabilities or other contractual commitments incurred by the Authority prior to the effective date of the party's notice
ofwithdrawal; and Section 8.2.2. If Bonds have been issued and the withdrawing Member Agency benefits directly or indirectly from the Bonds issued and outstanding, the Member Agency
shall not withdraw from the Authority until such time as all of those Bonds and the interest thereon shall first have been paid in full or provision for such full payment shall first
have been contractually made with the Authority and approved by the Board ofDirectors; and Second Restated and Amended Joint Exercise of Powers Agreement -Silicon Valley Animal Control
Authority August 8, 2003 Page 13 of2l ATTACHMENT 3