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HomeMy WebLinkAbout2010-11-23 - AGENDA REPORTS - AMEND LEASE DARCY LIBRARY (2)Agenda Item: CITY OF SANTA CLARITA AGENDA REPORT NEW BUSINESS City Manager Approval: Item to be presented by: Ken Striplin DATE: November 23, 2010 SUBJECT: AMENDMENT NO. 2 TO LEASE NO. 73694, CANYON COUNTRY JO ANNE DARCY LIBRARY, 18601 SOLEDAD CANYON ROAD, CITY OF SANTA CLARITA DEPARTMENT: City Manager's Office RECOMMENDED ACTION City Council: Authorize the City Manager or designee to sign, subject to City Attorney approval, amendment No. 2 to lease No. 73694, Canyon Country Jo Anne Darcy Library, 18601 Soledad Canyon Road, City of Santa Clarita. 2. Authorize a loan in the amount of $622,600 from the General Fund Capital Projects Reserve to the Public Library Fund at an interest rate equal to the rate of return on investments of the City's cash and investment portfolio and to be repaid at such time as is possible by the Public Library Fund; and appropriate said amount within Fund 309. BACKGROUND On July 10, 2001, the City Council approved lease No. 73694 between the City of Santa Clarita, as lessor, and the County of Los Angeles, as lessee. Per lease No. 73694, 12,500 square feet of the Canyon Country Jo Anne Darcy Library was leased by the City of Santa Clarita to the County of Los Angeles to be operated and maintained by the County Library. The remaining 4,500 square feet was not initially used for public library services and for a time was leased by the City to College of the Canyons. The term of the lease, including options, is 40 years, with the provision that the lease is terminated in the event the City withdraws from the County Library. On July 30, 2009, the City Manager signed Amendment No. 1, the primary purpose of which was to lease the additional 4,500 square feet to Los Angeles County and to clarify responsibilities � �� r U related to compliance with the Americans with Disabilities Act. On September 15, 2009, as part of their action to approve Amendment No. 1, the Los Angeles County Board of Supervisors appropriated public library developer fee funds for and approved the expansion of the Canyon Country Jo Anne Darcy Library to include the vacant 4,500 square feet. Construction of the expansion commenced on May 14, 2010. Per the County Library, the total estimated project cost is $1,852,000. On August 24, 2010, following a duly noticed public hearing, the City Council adopted a resolution to withdraw from the County Library, effective July 1, 2011. On August 30, 2010, construction of the expansion was halted. At issue is the funding source used to complete the project, given the upcoming withdrawal of the City from the County Library. Per the County Library, expenditures to date total $1,188,660 as follows: $752,400 for construction; $291,260 for furniture and equipment; $144,000 for library materials; and $1,000 for civic art. Per the County Library, the estimated cost to complete construction is $522,600, and the cost of the remaining furniture and equipment to be purchased is $10,000. The estimated time for completion of the expansion and reopening of the library is 12 weeks. City and County staff have had numerous discussions and held two in-person meetings to negotiate an equitable agreement on the completion and funding of this project. These discussions and meetings have been cordial, professional, and productive. The deal points both parties have agreed to recommend to their governing bodies are below. County Library staff will present this proposed Amendment No. 2 to the Board of Supervisors for their consideration in December. • The City and County Library agree it is in the best interest of the community to complete the expansion project and reopen the library as soon as possible. The County Library will complete the expansion project and reopen the library by March 1, 2011. The City will pay the County Library the cost of completion, totaling $522,600, and will pay $100,000 for costs incurred by the County related to HVAC, fire supression, and low -voltage systems, for a total of $622,600. Both parties agree liquidated damages of $500 per day will be assessed in the event the expansion is not completed and the library is not opened by March 1, 2011. The County Library will support the application of the Santa Clarita Public Library to join the Southern California Library Cooperative. In return, the City will provide basic public library services on an equal basis to residents of unincorporated Los Angeles County for a period of not less than five years. • The lease will terminate on June 19, 2011, to provide sufficient time to transition public library operations at that facility from the County Library to the Santa Clarita Public Library. E • As part of the upcoming negotiations between the City and the County Library regarding the purchase of library facilities, collections, furniture, and equipment located at all three local libraries, the City will consider purchasing from the County Library the new library materials, furniture, and equipment the County Library purchased for the expansion of the Canyon Country Jo Anne Darcy Library. If the City chooses to purchase the new library materials, furniture, and equipment the County Library purchased for the Canyon Country Jo Anne Darcy Library, the City will pay the County Library the actual purchase costs incurred for these items. ALTERNATIVE ACTIONS Other action as determined by the City Council. FISCAL IMPACT Funds of $622,600 will be loaned from the General Fund Capital Projects Reserve to the Public Library Fund and paid to Los Angeles County for the completion of the expansion of the Canyon Country Jo Anne Darcy Library. The funds will incur interest and be repaid in the future by the Public Library Fund. 2