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Home My WebLink AboutJOHN STEWART COMPANY, INC - 2006-10-02I--" Council/Agency Meeting Held: Deferred/Continued to: r `. + Appr ve ❑ Conditionally Approved t7 berried ... City kf s ignat Council Meeting Date: 10/2/2006 Department UDumb&- ED 06-37 CITY OF HUNTINGTON BEACH REQUEST FOR CITY COUNCIL ACTION SUBMITTED TO: HONORABLE MAYOR AND CITY C9VKIL MEMBERS SUBMITTED BY: PENELOP CULB TH-GRAFT, PA, C ADMINISTRATOR PREPARED BY: STANLEY SMALEWITZ, DIRECTOR OF ECONOMIC DEVELOPMENT SUBJECT: APPROVE MANAGEMENT CONTRACT FOR EMERALD COVE SENIOR APARTMENT COMPLEX Statement of Issue, Funding Source, Recommended Action, Alternative Action(s), Analysis, Environmental Status, Attachment(s) Statement of Issue: Approve a five-year management agreement with the John Stewart Company, Inc. for the operation and management of the City -Owned Emerald Cove Senior Apartment Complex. Funding Source: $400,000 is budgeted for this contract in FY 06/07 Emerald Cove Account 50380101.69505. An additional $88,920 is requested from the Emerald Cove Fund Balance Fund 503 during the 2006/07 fiscal year. Subsequent years budgets will reflect a not -to - exceed amount of $488,920 per year. Recommended Action: Motion to: 1. Approve the Management Agreement with the John Stewart Company, Inc. for the management of Emerald Cove Complex subject to approval of the insurance and bond requirements by the City Attorney, and 2. Authorize the Mayor and City Clerk to execute the agreement. 3. Designate $88,920 of Emerald Cove Fund Balance at September 30, 2006 to cover anticipated increases to the 2006-07 requested budget. Alternative Action(s): 1. Do not approve the agreement with the John Stewart Company, Inc. and award the contact to another company that submitted a proposal for the management services of Emerald Cove Complex; or 2. Do not approve the agreement with the John Stewart Company, Inc. and direct staff to solicit bids again. E_ REQUEST FOR CITY COUNCIL ACTION MEETING DATE: 10/2/2006 DEPARTMENT ID NUMBER: ED 06-37 Analysis: The City's five-year management contract with the current managers of Emerald Cove, Western Seniors Housing, Inc., will expire soon. Expecting this, in July the Real Estate Services division solicited bids from 14 management firms experienced with affordable and/or senior housing. Five proposals were received from various management firms, including Community Housing Services Management, Living Opportunities Management Company (LOMCO), Western Seniors Housing, Barker Management Incorporated, and John Stewart Company, Inc. Staff reviewed the proposals and also requested that Keyser Marston Associates (KMA) objectively review, analyze and perform background checks on each proposal, including a comparison of the affordable and senior housing experience, knowledge, financial stability, proposed staffing and site management experience, budget preparation and management fee, references and senior program services being offered by each proposer. Overall, staff and KMA ranked John Stewart Company, Inc. (Stewart) first in all categories and recommends Stewart as the most qualified managing agent for the Emerald Cove complex (See Attachment #1 and Attachment #2- Exhibit F). An interview with the regional managers of Stewart was attended by Community Services, Senior Center, Economic Development and Real Estate Services department staff. The interview included a review of Stewart's accounting and management procedures, recreational and social programming, maintenance standards, ability and experience with regard to large, "tenant -in -place" capital repair projects, and management transition needs. Additionally, staff toured several of the facilities now being managed by Stewart. Staff is recommending that Stewart be awarded the five-year contract for the management of Emerald Cove based on the above analysis, interview, and the many new social and independent living programs and facility enhancements that will be made available to Emerald Cove residents and Stewart's ability to coordinate major "tenant in place" rehabilitation projects. The management fee being charged by Stewart is $78,240 per year ($40 per rented unit per month), which is equal to $391,200 over the life of the five year contract. Staff has confirmed that this amount is comparable to the management fees being charged at other similar senior apartment complexes. The term of the agreement is five (5) years, with an option to extend the agreement for an additional two (2) times in increments of two (2) years. The total proposed annual budget for Emerald Cove is as follows: *Income Rents $ 972,600.00 Other Income $ 22,560.00 Total Estimated Income $ 995,160.00 #Ex enses Operating Expenses $ 360,150.00 Maintenance & Repairs $ 50,050.00 Management Fee $ 78,720.00 Total Estimated Expenses $ 488,920.00 -2- 9/20/2006 9:02 AM REQUEST FOR CITY COUNCIL ACTION MEETING DATE: 10/2/2006 DEPARTMENT ID NUMBER: ED 06-37 Net Income $ 506,240.00 *Income based on actual July 2006 rents received #Antici ated expenses as per proposed budget To accommodate anticipated and unexpected monthly expenses, the Emerald Cove Operating Account balance will be raised to $50,000.00. An amount not to exceed $488,920.00 will be budgeted annually to cover the monthly expenses associated with Emerald Cove. All other differences between the former contract with Western Seniors Housing, Inc., prepared by the City Attorney, and the attached contract are minimal. Staff's recommendation of Stewart was presented to the Economic Development Committee on August 14, 2006 where it was recommended that staff seek City Council's approval of the attached five-year contract with Stewart for the management of the Emerald Cove Complex. The attached management contract between the City of Huntington Beach and John Stewart Company, Inc. is being presented to the City Council for approval (See Attachment #2). Environmental Status: Not applicable. Attachment(s): -3- 9/20/2006 9:02 AM Analysis of Stewart Proposal for the Management of Emerald Cove Senior Apartment Complex from Keyser Marston and Associates ATTACHME-N--T 1 Attachment #3 Analysis Results for John Stewart Company, Inc. From Keyser Marston Associates THE JOHN STEWART COMPANY EMERALD COVE SENIOR HOUSING COMPLEX HUNTINGTON BEACH, CALIFORNIA Organization A. Proposal Forms Property Management Services Proposal Form Provided Address 624 S. Grand Ave., 2500, Los Angeles, CA 90017 Phone Number (213) 833-1860 Organizational Structure Corporation Contact Person Lori L. Horn, Vice President RFP Submission Checklist Provided B. Business Structure Years in Business 28 Number of Employees 1,100 (+) Mission Statement Provide secure, service -oriented, well maintained and professionally managed housing that serves the interests of residents and owners alike. Key Staff Judy Cunningham, Sr. Regional Manager Lori Horn, Vice President Donna Lambe, Regional Director Daphne Oakley, Accounting Manager Michele Kuraner, Director of Compliance Qualifications Judy Cunningham has 25+ years of experience in affordable housing and supervises properties in Orange County area. Lori Horn has over 20 years of experience in affordable housing management, and is responsible for over 90 affordable multifmaily communities in So. California. Donna Lambe has 20+ years of experience and supervises 700 multi -family units. Project Experience Bolded Projects - managed for previous 3 ears Name - City (Size. Unit types. Affordable %. Senior %. Year Built, No. Staff) Heritage Villas - Mission Viejo (143 units, 1,2-bdrm, 100%A/100%S, Built in 2004, 4 staff) Project #1 Project #2 Mendocino at Talega - San Clemente (186 units, 2,3,4-bdrm, 100%A/0%S, Built in 2002, 7 staff) Project #3 Montecito Vista - Irvine (162 units, 2,3-bdrm, 100%A/0%S, Built in 2006, 6 staff) Project #4 Olen Jones - Rancho Cucamonga (97 units, 1,2-bdrm, 100%A/100%S, Built in 2005, 3 staff) Project #5 Villa Pacifica - Rancho Cucamonga (158 units, 1,2-bdrm, 100%A/100%S, Built in 1999, 4 staff Project #6 Harvest Ridge - Chula Vista (90 units, 1-bdrm, 100%A/100%S, Built in 2004, 3 staff) Project #7 Osage Senior - Inglewood (91 units, 1,2-bdrm, 100%A/100%S, Built in 2004, 3 staff) Project #8 Luis Spud Moreno - Calexico (90 units, 1,2-bdrm, 100%AI100%S, Built in 2003, 2 staff) Project #9 Lindbrook Court - Anaheim (82 units, 1,2-bdrm, 100%AI100%S, Built in 2002, 2 staff) Project #10 Villa Escondido - Escondido (112 units, studio,1-bdrm, 100%A/100%S, Built in 2002, 4 staff) Rent Schedule by Unit Type Not Provided Financial Capability A. Audit/Review of Financial Statements Provided B. Certified copy of Financial Statement Provided Prepared by: Keyser Marston Associates Filename: Emerald Cove RFP Review; John Stewart; 814/2006; cb Page 1 of 2 THE JOHN STEWART COMPANY EMERALD COVE SENIOR HOUSING COMPLEX HUNTINGTON BEACH, CALIFORNIA V. VI. VII. Vill. IX. Budget and Management Plan A. Proposed Budget & Management Plan Proposed Operating Budget (NOI) 2006 $1,048,083 2007 $1,100,487 2008 $1,155,512 2009 $1,213,287 2010 $1,273,951 2011 $1,337,649 Proposed Management Plan Provided B. Financial and Management Reports (samples) Included sample budget and various financial reports (monthly financial report, cash analysis, check register, open invoice report, accounts payable, balance sheet, income statement, checking statement, general ledger, rent roll) C. Narrative (anticipated expenses, revenues, Sample provided net income References A. References (at least 3) Reference #1 Jamboree Housing - Irvine (Mary Jo Goelzer) Reference #2 Los Angeles Housing Partnership - Los Angeles (Lou Benardy) Reference #3 Community Housing Works - Escondido (Rosemary Stabrawa) B. 10 Senior resident references Included 10 resident references & letters from 5 different properties (Sorrento Villas, Villa Paloma, Rugby Plaza, Camden Place, Linbrook Court) Questions A. Difference between assisted & market rate props. Main difference is the focus and rental objective. Assisted housing properties have more stable tenancy, but more complicated (and sometimes conflicting) regulatory restrictions (certifying households, regulatory auditsfinspections) Market rate focuses on maximizing rents and minimizing vacancy rates. Vacancy costs, concessions, marketing commission and advertising costs are most important factors. B. Transition Plan Attached comprehensive takeover list (lists important documents & issues to be addressed). Will request meeting with existing management and interview existing staff initially. C. Goals & Objectives Maintain property professionally, provide rich/supportive rental environment, achieve budgeted operating results. Will work closely with City. D. Resident Outreach/Tenant Activity Programs Several community -sponsored activities (listed in monthly newsletter). Experience providing seniors with supportive services. E. 'Tenant in Place" renovation project Coordinate with contractors, maintain consistent business hours and complete exterior work without disrupting residents. Submittals A. Newsletter Provided sample newsletters from 3 different properties B. Maintenance Plan & Schedule Provided Miscellaneous A. Contract Approval Agreed to all contract terms B. Management Fee per month Approximately $40 per month C. Any other Submittals Included insurance limits Comments Prepared by: Keyser Marston Associates Filename: Emerald Cove RFP Review; John Stewart; 8/4/2006; cb Page 2 of 2 Contract Between the City of Huntington Beach and John Stewart Company for Management Services of Emerald Cove Senior Housing Complex ATTACHMENT 2 MANAGEMENT AGREEMENT BETWEEN THE CITY OF HUNTINGTON BEACH AND JOHN STEWART COMPANY, INC. FOR THE MANAGEMENT .OF EMERALD COVE SENIOR HOUSING COMPLEX TABLE OF CONTENTS LPURPOSE ...............................................................................................................................1 2. SITE........................................................................................................................................1 3. TERM OF AGREEMENT AND TERMINATION............................................................... 2 4. MANAGEMENT FEE............................................................................................................ 2 5. SERVICES NOT COVERED BY MANAGEMENT FEE .................................................... 3 6. MARKETING.........................................................................................................................3 7. RENTALS...............................................................................................................................3 8. COLLECTION OF RENTS AND OTHER RECEIPTS........................................................ 4 .9. OPERATING ACCOUNT...................................................................................................... 4. 10. DISBURSEMENTS FROM OPERATING ACCOUNT....................................................... 4 11. ANNUAL OPERATING BUDGET....................................................................................... 5 12. TENANTS' ACTIVITIES ACCOUNT.................................................................................. 6 13. ENFORCEMENT OF LEASES ............................ ... .............................................................. 6 . 14. WAITING LISTS AND APARTMENT MOVES................................................................. 6 15. MAINTENANCE AND REPAIR ..................................................... :.................................... 7 16. UTILITIES AND SERVICES................................................................................................ 8 17. EMPLOYEES......................................................................................................................... 8 18. BOOKS, RECORDS, AND REPORTS................................................................................. 9 19. FIDELITY BOND.............................................................................................. .............10 20. BIDS, DISCOUNTS, REBATES, ETC................................................................................10 21. ON -SITE MANAGEMENT FACILITIES...........................................................................10 22. TRANSFER OF MANAGEMENT.................................................................................10 23. HOLD HARMLESS.................................................................................... .....................10 24. WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY INSURANCE......... i 1 25. GENERAL LIABILITY INSURANCE...............................................................................11 26. CERTIFICATES OF INSURANCE; ADDITIONAL INSURED ENDORSEMENTS ...... 12 27. NONDISCRIMINATION.....................................................................................................12 28. NOTICES ........... :.................................................................................................................. 12 29. CONTRACT ADMINISTRATOR.......................................................................................13 30. COVENANTS, REPRESENTATIONS AND WARRANTIES..........................................13 31. HAZARDOUS MATERIALS..............................................................................................13 , 32. NO ASSIGNMENT.........................................................................................................14 33. FORCE MAJEURE - UNAVOIDABLE DELAYS............................................................14 34. COMPLIANCE WITH LAWS.............................................................................................14 35. BINDING ON HEIRS AND SUCCESSORS.......................................................................14 36. INTERPRETATION OF THIS AGREEMENT...................................................................14 37. WASTE OR NUISANCE.................................................................................. ........... Is 38. INSURANCE HAZARDS....................................................................................................15 39. INSURANCE PROCEEDS.................................................................................................. 15 40. TIME OF ESSENCE................................................................ .......15 ..................................... 41. GOVERNING LAW............................................................................................................. 15 42. SURVIVAL.......................................................................................................................... 16 43. CITY EMPLOYEES AND OFFICIALS..............................................................................16 44. IMMIGRATION.................................................................... ....................16 ........................... 45. LEGAL SERVICES SUBCONTRACTING PROHIBITED ........................:...................... 16 46. ATTORNEY'S FEES.........................................................................................................16 47. WAIVER OF BREACH.......................................................................................................16 48. DUPLICATE ORIGINAL....................................................................................................16 49. CAPTIONS...........................................................................................................................17 50. SOLE AND ONLY AGREEMENT.....................................................................................17 ii MANAGEMENT AGREEMENT BETWEEN THE CITY OF HUNTINGTON BEACH AND JOHN STEWART COMPANY, INC. FOR THE MANAGEMENT OF EMERALD COVE SENIOR HOUSING COMPLEX THIS MANAGEMENT AGREEMENT ("Agreement'l is made and entered into by and between the CITY OF HUNTINGTON BEACH, a municipal corporation of the State of California ("City') and JOHN STEWART MANAGEMENT COMPANY, INC., a California corporation (°`Manager"). WHEREAS, City desires to engage .the services of a management company to provide management services for the Emerald Cove Senior Housing Complex ("Site") and Manager has been selected to perform said services. NOW, THEREFORE, it is agreed by City and Manager as follows: 1. PURPOSE The purpose of this Agreement is to provide for the management of the "Site". The management of the Site pursuant to this Agreement and the fulfillment of this Agreement are in the vital and best interests of City, and the health, safety, morals and welfare of its residents, and in accordance with the public purposes and provisions of applicable Federal, State and local laws and requirements. In addition to the terms, conditions and covenants contained herein, Manager shall perform those services as set forth in Exhibit "F" (Management Services Plan) attached hereto and incorporated herein by this reference to this Agreement. The Management Services Plan includes programs and activities that will be provided by Manager to residents. All terms and conditions (including but not limited to all policies and procedures regarding employment, transfer of records, accounting, reporting, records retention, purchasing/procurement, establishment of accounts, security deposits, occupancy, rent collection and retention, budgets, tenant grievances, and maintenance and security) detailed in the Management Services Plan are subordinate to the terms and conditions of this Management Agreement and in the event of a conflict, the terms of this agreement shall control. All terms and conditions/programs and activities detailed in the Management Services Plan shall be pre -approved and subject to modification at the sole discretion of the City. 2. SITE The Site is that portion of the land shown on the map of the `Site," incorporated herein by this reference and attached hereto as Exhibit "A" and located at 18191 Parktree Circle, Huntington Beach, California, 92648. A senior affordable housing development (known as the "Emerald Cove Senior Housing Complex" and hereinafter referred to as "Emerald Cove") consisting of the land, buildings, comprising one hundred sixty-four (164) dwelling units, and other improvements is located on the Site. City is the owner of the Site and Emerald Cove. W 434/4105 Page 1 of 20 ZAb This Agreement shall be in effect for a period of five (5) years beginning on the kd day of OU'DB-12 , 2006 (the "Commencement Date"), and ending on the 30th day of OMA ' , 2011, subject, however to the following conditions: A. City shall have the option of extending this Agreement twice in increments of two (2) years and shall give written notice of its intent to exercise this option six (6) months prior to the expiration of this Agreement. Manager must submit in writing within thirty (30) days from receipt of City's notice that it agrees to continue as a party under the same terms and conditions of the Agreement for the stated two (2) year extension. B. All services contracted for under this Agreement must be performed in a manner acceptable to City. City shall have the power to terminate this Agreement at any time if City determines that Manager has breached this Agreement, by giving Manager thirty (30) days written notice, whether or not the term of Agreement has ended. C. In addition to the above, City may terminate this Agreement at any time upon sixty (60) days written notice if City determines that it does not have sufficient funds to pay for Manager's services under this Agreement or City transfers, sells, or otherwise divest control of the Site. D. In the event a petition in bankruptcy is filed by or against Manager, or in the event Manager makes an assignment for the benefit of creditors or takes advantage -of any insolvency act, City may terminate this Agreement immediately upon written notice to Manager of such termination. E. In the event of condemnation, the Agreement shall terminate as of the date title to the Site vests in the condemning authority. If any property . described herein or hereinafter added hereto is taken in eminent domain, the entire award shall be paid to City. This Agreement shall have no condemnation value to Manager. F. Upon termination, Manager will submit to City all records, including all financial ledgers, as specified in, but not limited to, Section 18 of this Agreement. After the parties have accounted to each other with respect to all matters outstanding as of the date of termination, City will return to Manager its fidelity bond, in form and principal amount as determined by City, minus any unpaid obligations or liabilities Manager incurred under this Agreement. 4. MANAGEMENT FEE Manager shall be entitled to a Management Fee for its services under this Agreement equal to Forty Dollars ($40.00) per leased unit per month prorated for any lease entered into or terminated after the first of the month. The Management Fee shall be due and payable monthly to Manager on the first day of each month, commencing at the end of the first full calendar month of the term hereof if supporting documentation is received by the City prior to the tenth (101h) day of the 0&43V4105 Page 2 of 20 month on which payment is due. On the first business day of each subsequent month, City will pay the monthly Management Fee conditioned upon City's prior receipt and written approval of Manager's prior month's Management Fee calculation. 5. SERVICES NOT COVERED BY MANAGEMENT FEE The following expenses shall not be bome by Manager, but shall in all cases by paid for directly from the Operating Account for the Site: A. Resident manager. B. Other on -site staff, listed in Section 17 of the Agreement. C. Auditing expenses, finance and accounting materials and services. D. Maintenance and repairs. E. Security personnel, if required. F. Around -the -clock personnel, as pre -approved in writing by City. G. Cost of eviction proceedings. 6. MARKETING Manager will market the Site as is necessary for full and continued occupancy of Emerald Cove, according to a tenant selection policy as specified by City. Manager will begin marketing upon execution of this Agreement and all associated marketing expenses shall be paid out of the Operating Account (defined in Section 9 of this Agreement), and such expenses shall not exceed the amount budgeted for that expense in the Annual Operating Budget (defined in Section I 1 of this Agreement) without prior written consent from City. 7. RENTALS Manager will offer for rent and will rent the dwelling units, parking spaces, and other rental facilities located on the Site. Incident thereto, the following provisions will apply: A. Manager will follow the tenant selection policy as specified by City. B. Manager will show the Site and will provide a step-by-step process required for tenancy to prospective tenants. C. Manager will take and process applications for rentals. Manager will review applications based upon objective criteria agreed upon by both City and Manager. If an application is rejected, the application along with a completed criteria sheet indicating rating will be kept on file for one (1) year. D. Manager will prepare all tenant leases and parking permits using forms that have been submitted and pre -approved in writing by City, and will execute the same in City's name. 06434/4105 Page 3 of 20 E. Manager will submit to City annually a proposed rent schedule showing the proposed rent increases for dwelling units, and other charges for facilities and services. The proposed rent schedule shall be based upon a market comparison with similar type units and facilities, which shall be completed by Manager. City will review such rent schedules and will make adjustments as will best suit its purpose. No increase in rents or fees shall be presented or implemented to the tenants of the Site without the prior express written consent of City. M► 1 1. I1 M01 y Manager will collect when due all rents, security deposits, late charges and other amounts receivable on City's account in connection with the management and operation of the Site. Manager, upon execution, will use the current rent and security schedule incorporated herein and attached hereto as Exhibit 'B", which is incorporated herein by this reference, as the basis for collection. Such receipts will be deposited daily in bank account(s) designated by City. Manager will send City monthly reports in a format approved by the City of all collected rents. 9. OPERATING ACCOUNT Manager shall establish a bank account to pay for certain operating expenditures described in this Agreement (the "Operating Account"). Manager shall have signature authority over this account and be entitled to withdraw disbursals from the Operating Account for reimbursable costs pre - approved in writing by City. City shall deposit Fifty Thousand Dollars ($50,000.00) into this account as an initial balance to cover approved expenses for the first month of this Agreement. Manager shall refund all amounts received upfront from the City by transferring said. amounts into a bank account designated by the City Treasurer upon termination of this Agreement. In no event shall an amount be disbursed from the Operating Account for a particular expense to the extent such expense exceeds the amount budgeted for that expense in the Annual Operating Budget as specified in Section 11 of this Agreement. In case of an emergency, Manager may be entitled to additional disbursal(s) from the Operating Account to cover the additional expenses arising from such emergency and upon submission of a report and prior written approval by City. Upon monthly submission by the Manager to the City on or before the tenth (10th) day of the month upon which expenses are requested, and City's written approval of the report required by Section 18 of this Agreement, City shall deliver to Manager the amount of the approved expenses. In addition to the monthly reimbursement from the Operating Account by City, City may reimburse the Manager as needed to meet operating expenses, upon presentation by Manager and prior written approval by City of invoices for authorized expenses. Manager agrees to work with the City to develop a cost effective means of reimbursement. 10. DISBURSEMENTS FROM OPERATING ACCOUNT From the funds in the Operating Account, Manager will make the following disbursements after presentation of an invoice to City and City's written approval thereof and subsequent transfer of funds into the Operating Account: 0"34/4105 Page 4 of 20 A. Reimbursement for compensation payable to Manager's employees including all taxes and assessments payable to local, State, and Federal governments in connection with the employment of such personnel. Manager will be responsible for remitting all required payroll items and is the employer of record. B. The payments required to be made by City for taxes and assessments, fire and other hazards insurance premiums, and rental interruption insurance premiums for the Site. C. All sums otherwise due and payable by City as expenses of Manager authorized to be incurred by Manager under the terms of this Agreement, including the Management Fee payable to Manager for its services hereunder. 11. ANNUAL OPERATING BUDGET Manager shall submit to City, by February 1 of each year that this Agreement is in effect, a proposed budget for the following year (the "Annual Operating Budget"). The Annual Operating Budget shall, to the extent applicable, include: A. A statement of all revenues estimated to be derived from the Site, including, but not limited to all sums payable, pursuant to all leases, and all sums payable in lieu thereof, including, but not limited to, insurance proceeds payable as a result of business interruption and damages payable in lieu of rent, and all advances estimated to be required to balance the budget. B. A statement of estimated costs and expenses regularly incurred, including, but not limited to, the following: i) All costs and expenses to be incurred in connection with the management, operation, maintenance, or repair of the Site, including, but not limited to: 1) All sums payable under service contracts, including, but not limited to, agreements related to air-conditioning and heating, general cleaning, utilities, refuse removal, grounds and plant maintenance, pest control, security, windowing cleaning, etc. 2) All other charges, costs and expenses of a regular nature for services and supplies provided to and for the benefit of the Site and in the normal operation thereof. ii) The installments of impositions and insurance premiums as may be required. C. A statement of costs and expenses of an extraordinary nature, including, but not limited to, the following: i) Estimated costs and expenses to be incurred in connection with the provision of any capital improvements. ii) Projected costs due to lack of reimbursement for claims made under any policy of insurance covering the Site or projected costs arising from or under any guarantee or warranty bond or other contract relating to the Site as may be known at the time of budgeting. iii) Estimated costs and expenses, to the extent known at time of budgeting, to be incurred pursuant to the order or direction of any State, Federal or municipal authority having jurisdiction over the Site. 06.4-W4105 Page 5 of 20 D. A statement of estimated capital improvements, replacements or repairs, on a five (5) year schedule, required to maintain the Site in a safe and healthy environment suitable for tenant occupancy including, but not limited to, the following: i) Projected replacement schedule for all major equipment, i.e. boiler, heat and ventilating systems. ii) Projected schedules for painting exterior and common interior areas of the Site. 12. TENANTS' ACTWITES ACCOUNT Manager shall establish a tenants' activities account for the placing of all funds collected from tenants for tenants' association activities. This account shall be under the sole control of Manager, and City shall incur no liability to tenants or others in connection with the funds from this account. Manager shall maintain a complete accounting record of amounts received from tenants, for what purpose, the expense by item, and any other such tracking as may be appropriate. Manager shall submit monthly a copy of the ledger and copies of all receipts and disbursements to City for the tenants' activities account. 13. ENFORCEMENT OF LE Manager will secure full compliance by each tenant with the terms of their lease and the Emerald Cove Resident's Handbook, a copy of which is attached hereto as Exhibit "C" and incorporated herein by this reference. Manager shall maintain at the Site individual lease files, coded by unit number and tenant name. Voluntary compliance shall be emphasized, and Manager shall counsel tenants and make referrals to community agencies in cases of financial hardship or other circumstances deemed appropriate by Manager, all to the end that involuntary termination of tenancies shall be avoided to the maximum extent, consistent with sound management of the Site. Nevertheless, Manager may lawfully terminate any tenancy with at least three (3) days prior written notice to City when, in Manager's judgment sufficient cause (including, but not limited to, nonpayment of rent) for such termination occurs under the terms of the tenant's lease. Manager is authorized to consult with legal counsel to bring actions for eviction and to execute notices to vacate and judicial pleadings incident to such action; provided, however, that Manager shall obtain the prior written approval of the City Attorney for any such consultation, and that Manager follow such instructions as City may prescribe for the conduct of any such action. Subject to the City Attorney's prior written approval, attorney's fees and other necessary costs incurred in connection with such actions will be paid out of the Operating Account as Site expenses. 14. WAITING LISTS AND APARTMENT Manager shall maintain an official waiting list of interested parties who desire an opportunity for tenancy in the Site. This list shall, at a minimum, include the parties' name, current address, telephone, and date of the parties' request to be placed on the waiting list. Each interested party must fill out and sign an "Interest Form". If an existing tenant desires to move to a different apartment within Emerald Cove, the tenant must fill out and sign an "Apartment Change Request Form". Manager also shall maintain an apartment change waiting list with all relevant information. Manager shall maintain both lists in an accurate and detailed manner with a proper 0&43 91os Page 6 of 20 filing system as backup so that any person will understand his or her place on the respective list and the basis for his or her position. Manager and City will establish guidelines for the proper use of these lists. All lists shall be maintained in a secure location and Manager shall be responsible to maintain the confidentiality of the lists. 15. MAINTENANCE AND REPAIR Manager will cause, the Site to be maintained in a decent, safe and sanitary condition at all times acceptable to City in accordance with the Huntington Beach Municipal Code and the laws of California, including, but not limited to cleaning, painting, decorating, plumbing, carpentry, grounds care, landscaping and such other maintenance and repair work as may be necessary, subject to any limitations and/or conditions imposed by City in addition to those contained herein. Manager agrees to operate and manage the Site in a high quality manner and shall maintain the Site in accordance with the minimum maintenance standards as listed in the attached Exhibit "D", which is incorporated herein by this reference. City reserves the right to amend Exhibit "D" at any time during the term of the Agreement with at least thirty (30) days prior written notice to Manager indicating such changes. Manager agrees it shall provide an overall standard of services at least equal to a "B" or better rating as described in the monthly Site evaluation report (the "Evaluation Report'), which is attached hereto as Exhibit "E" and incorporated herein by this reference, with no single category maintained below a "C" rating. In the event the Evaluation Report indicates that the Site does not meet the minimum rating requirements set forth above, City may issue a detailed, itemized list of all items that need to be corrected, improved, or repaired on the Evaluation Report. The Evaluation Report shall serve as City's written notice pursuant to Section 28 of this Agreement. Manager shall ensure that as soon as reasonably possible after receiving such notice, City and Manager shall meet and discuss the monthly Evaluation Report, and shall, in good faith, attempt to agree upon the steps Manager shall take to correct, improve, or repair the items included on the Evaluation Report and the time schedule for doing so. Except as provided below, Manager shall have thirty (30) days after receipt of the monthly Evaluation Report to correct, improve, or repair each of the items on the Evaluation Report, provided that if any item cannot be corrected, improved, or repaired in such period, Manager shall have such additional time as reasonably necessary to complete such correction, improvement, or repair so long as Manager begins such work within the thirty (30) day period and diligently proceeds with such correction, improvement, or repair to completion. Incident thereto, the following provisions shall apply: A. Manager shall give special attention to preventative maintenance, and to the greatest extent feasible, the services of Manager's regular maintenance employees will be used B. Subject to City's prior written approval for maintenance and for extraordinary repairs beyond the capability of Manager's regular maintenance employees, Manager will contract with qualified independent contractors utilizing competitive bidding whenever practicable. 0&4.W4105 Page 7 of 20 C. Manager will systematically and promptly receive, investigate, and document all service requests from tenants, take such action thereon as may be justified, and keep records of the same. Manager shall perform services on an emergency request within twenty-four (24) hours of the receipt of such request. Complaints of a serious nature will be reported to City after investigation. City shall have the right to receive copies of all service requests and the reports of action taken thereon. D. Manager is authorized to purchase all materials, equipment, tools, appliances, supplies and services necessary for proper maintenance and repair of the Site. Manager shall use its best efforts to take such action as is necessary to comply with any and all orders or requirements of Federal, State, county, or municipal authorities having jurisdiction over the Site and orders from fire underwriters, insurance companies, and other similar bodies. E. Notwithstanding any of the foregoing provisions, the prior approval of City will be required for any expenditure which exceeds One Thousand Dollars ($1,000.00) in any one instance for labor, materials or otherwise in connection with the maintenance and repair of the Site, except for recurring expenses within the limits of the Annual Operating Budget or emergency repairs involving manifest and immediate danger to persons or property, or required to avoid suspension of any necessary service to the Site. When such recurring or emergency expenditure occurs, Manager will inform City of the facts as promptly as possible, and, in no event later than twenty-four (24) hours from the occurrence of the event. 16. UTILITIES ANDSE,RVJCES Manager will make arrangements for water, electricity, gas, sewage and trash disposal, vermin extermination, decorating, laundry facilities, and telephone service to the Site. Subject to City's prior written approval, Manager will enter into such contracts as may be necessary to secure such utilities and services. Manager shall implement an appropriate recycling program of aluminum, glass, paper and any other materials pursuant to sound waste management practices. 17. EMPLOYEES In performing its duties and exercising its rights hereunder, Manager shall at all times be acting as an independent contractor. In no event shall Manager hold itself out as having any relationship with City other than as expressly created herein. Any personnel employed by Manager in rendering services hereunder shall be employees of Manager and shall not be deemed employees of City. All on -site personnel will be employees of Manager and will be hired, paid, supervised, and discharged through Manager, subject to the following conditions: A. The compensation (including fringe benefits) of Manager's resident manager, community services coordinator, maintenance employees, bookkeeping, clerical, and other management personnel shall be set forth in the Site's Annual Operating Budget, as approved by the City Council in City's annual budget. 0&43V4105 Page 8 of 20 B. Compensation (including fringe benefits) payable to the on -site management and maintenance .employees, and other personnel employed in the operation of the Site and all local, State and Federal taxes and assessments (including, but not limited to, Social Security taxes, unemployment insurance, and workers' compensation insurance) incident to the employment of such personnel, will be paid out of the Operating Account and will be treated as Site expenses. C. Manager shall comply with all of the provisions of the Workers' Compensation Insurance and Safety Acts of the State of California, the applicable provisions of Division 4 and 5 of the California Labor Code and all amendments thereto; and all applicable State and Federal acts and laws. All employees of Manager are expressly prohibited from making any work arrangements with the residents of the Site where compensation is exchanged between the resident and employee. All work by employees of Manager shall be as directed by Manager in the execution of this Agreement. Manager shall have the following record keeping responsibilities: A. Manager shall establish and maintain a comprehensive system of records, books, and accounts in a manner satisfactory to City. Further, all records, books, and accounts shall be maintained in an electronic format acceptable to City. Manager shall allow City's authorized representatives to examine its records, books, and accounts during normal business hours. B. With respect to each fiscal year ending during the term of this Agreement, Manager shall cause an annual financial report prepared by a certified public accountant or other person acceptable to City. The report shall be certified by the preparer and Manager, and will be submittal to City within ninety (90) days after the end of the fiscal year. Any compensation for the preparer's services will be paid out of the Operating Account after the invoice is approved in writing by City and the approved amount is transferred by City into the Operating Account. C. Manager shall prepare a monthly report comparing actual and budgeted figures for receipts and disbursements, along with a schedule of accounts receivable and payable from the Operating Account, and will submit each such report to City within fifteen (15) days after the end of the month covered. Manager also shall furnish City with all 'appropriate backup material related to such disbursements as proof of such expenses upon request. Once the report has been approved in writing by City, City will transfer the approved amount to the Manager. D. Manager shall promptly furnish such information (including, for example, occupancy reports) as may be requested by City from time to time with respect to the financial, physical, or operational conditions of Site. E. All records produced or used by Manager, whether located on -site or at the Manager's business, shall remain the property of City. 0&4349105 Page 9 of 20 19. FIDELITY BOND Manager will furnish to City, at Manager's sole cost and expense, a fidelity bond in the principal sum of Two Hundred Five Thousand Eight Hundred Sixty Dollars ($205,860.00), or an amount equal to the Site's gross potential income for two (2) months plus the initial deposit of Fifty Thousand Dollars ($50,000.00), whichever is greater, and is conditioned to protect City against, without limitation, misappropriation of the Site funds by Manager and its employees. Acceptance of this bond by City is conditioned upon the prior written approval of such bond by the City Attorney. Manager's costs associated with this bond (including the premium) shall not be included in any Annual Operating Budget or paid out of the Operating Account and bond amount shall be recalculated annually as of October 1. Annual bonding of Manager employees assigned to Emerald Cove may be paid out of Operating Account with a maximum of $400.00 per year total. Manager shall notify City if premiums are unpaid for ten (10) days and Manager shall promptly ensure that the premiums are paid in full. 20. BIDS, DISCOUNTS, REBATES, ETC. Manager shall obtain contracts, materials, supplies, utilities, and services on the most advantageous terms to City and the Site, and shall solicit, at least three (3) written bids, for items that exceed Five Hundred Dollars ($500.00) and can be obtained from more than one source. Manager will secure and credit to City all discounts, rebates or commissions obtainable with respect to any purchases, service contracts, and all other transactions on City's behalf or with regards to the Site. 21. ON -SITE MANAGEMENT FACILITIES Subject to further agreement of City and Manager as to more specific terms, Manager shall maintain a management office on the Site. City reserves the right and sole discretion to instruct Manager to change the resident manager or other responsible employee at any time during the term of this Agreement with at least sixty (60) days prior written notice. Employment of the resident manager or other responsible employee is subject to prior written approval by City. City shall not withhold approval or require Manager to change resident manager in violation of any federal, state or local law. 22. TRANSFER OF MANAGEMENT Manager shall be responsible to take all actions necessary to obtain all information from the outgoing management company to ensure that a smooth and efficient transfer occurs. All necessary documents, records, systems, and contracts shall be in place by Manager effective the Commencement Date of this Agreement. Manager shall make every effort to make the transfer of management transparent to the residents of the Site. Manager shall obtain and maintain a business license from City. 23. HOLD HARMLESS Manager shall protect, defend, indemnify and save and hold harmless City and its officers, officials, employees, and agents from and against any and all liability, loss, damage, expenses, 06-434/4105 page 10 of 20 and cost and demands, (including without limitation cost and fees of litigation of every nature) arising out of or in connection with Manager's performance of this Agreement or Manager's failure to comply with any of Manager's obligations contained in the Agreement by Manager, its officers, agents or employees except such loss or damage which was caused by the sole negligence or willful misconduct of the City. City shall be reimbursed by Manager for all costs and attorney's fees incurred by the City in enforcing this obligation. 24. WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY INSURANCE Pursuant to California Labor Code Section 1861, Manager acknowledges awareness of Section 3700 et seq. of said Code, which requires every employer to be insured against liability for workers' compensation; Manager covenants that it will comply with such provisions prior to commencing performance of the work hereunder, and shall indemnify, defend and hold harmless City from and against all claims, demands, payments, suit, actions, proceedings, and judgments of every nature and description, including attorney's fees and costs presented, brought or recovered against City, for or on account of any liability under any of said acts which may be incurred by reason of any work to be performed by Manager under this Agreement. -Manager shall maintain workers' compensation and employers' liability in amounts not less than the State statutory limits. Manager shall require all sublicensees to provide such workers' compensation and employers' liability insurance for all of the sublicensees' employees. Manager shall famish to City a certificate of waiver of subrogation under the terms of the workers' compensation and employers' liability insurances and Manager shall similarly require all sublicensees to waive subrogation. 25. GENERAL LIABILITY INSURANCE In addition to the workers' compensation and employers' liability insurance and Manager's covenant to indemnify City, Manager shall obtain and furnish to City, a policy of general public liability insurance, including automotive bodily injury and property damage insurance covering the Site and Manager's activities under this Agreement. The policy shall indemnify Manager, its officers, agents and employees, while acting within the scope of their duties, against any and all claims arising out of or in connection with the Site or Manager's activities under this Agreement, and shall provide coverage in not less than the following amount: combined single limit bodily injury, personal injury and property damage, including products/completed operations liability and blanket contractual liability, of One Million Dollars ($1,000,000.00) per occurrence. If coverage is provided under a form which includes a designated general aggregate limit, the aggregate limit must be no less than One Million Dollars ($1,000,000.00) for the Site and Manager's activities under this Agreement. The policy shall name City, its agents, officers, employees and volunteers as Additional Insureds, and shall specifically provide that any insurance coverage which may be applicable to the Site or Manager's activities under this Agreement shall be deemed excess coverage and that Manager's'insurance shall be primary. Under no circumstances shall the above - mentioned insurance contain a self -insured retention, or a "deductible" or any other similar form of limitation on the required coverage. 0&434/4105 Page 11 of 20 26. CERTIFICATES OF INSURANCE: ADDITIONAL INSURED ENDORSEMENTS Prior to the execution of this Agreement, Manager shall furnish to City certificates of insurance subject to approval of the City Attorney evidencing the foregoing insurance coverages as required by this Agreement; these certificates shall: A. provide the name and policy number of each carrier and policy. B. shall state that the policy is currently in force. C. shall promise that such policies shall not be suspended, voided or canceled by either party, reduced in coverage or in limits except after thirty (30) days' prior written notice; however, ten (10) days' prior written notice in the event of cancellation for nonpayment of premium. Manager shall maintain the foregoing insurance coverages in force during the entire term of this Agreement or any extensions or renewals thereof. The requirement for carrying the foregoing insurance coverages shall not derogate from the provisions for indemnification of City by Manager under the Agreement. City or its representatives shall at all times have the right to demand the original or a copy of all said policies of insurance. Manager shall pay, in a prompt and timely manner, the premiums on all insurance hereinabove required. 27. NONDISCRIMINATION In the performance of its obligations under this Agreement, Manager shall comply with the provisions of any Federal, State or local law prohibiting discrimination in housing on the grounds of race, color, sex, creed or national origin. All notices, certificates, or other communications hereunder shall be sufficiently given and shall be deemed received when (a) personally delivered; or (b) three (3) business days after being deposited in the United States mail in registered form with postage fully prepaid; or (c) one (1) business day after being sent by reputable overnight courier, in each case to the addresses specified below; provided that City and Manager, by notice given hereunder, may designate different addresses to which subsequent notices, certificates, or other communications will be sent: CITY: Director of Economic Development City of Huntington Beach 2000 Main Street Huntington Beach, CA' 92648 MANAGER: The John Stewart Company, Inc. Attn: Lori Horn, Vice President 624 South Grand Avenue, Ste. 2500 Los Angeles, CA 90017 3 3 2-�p 0&4.W4105 Page 12 of 20 29. CONTRACT ADWMSTRATOR City's Director of Economic Development, or his designee, shall be City's contract administrator for this Agreement with the authority to act on behalf of City for the purposes of this Agreement, and all approvals and notices required to be given herein shall be so directed and addressed. 30. COVENANTS, REPRESENTATIONS AND WARRANTIES Manager acknowledges, represents, warrants and agrees that: A. City intends that Manager's duties to be that of a fiduciary, with respect that any decision made or action taken in connection with the rendering of the performance of Manager's duties and services under this Agreement, and Manager will discharge its duties with respect to the Site solely in the interests of City and with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of like character and with like aims. B. Manager has complied with and shall comply with, all regulations, registrations, filings, authorizations, consents or examinations required by any governmental authority having jurisdiction over its activities or the acts contemplated by this Agreement. C. The personnel of Manager who will responsible for carrying out this Agreement are individuals experienced in the ' performance of the various functions contemplated by this Agreement. D. Manager shall promptly notify City of any contemplated change in control of Manager and of any and all legal or financial actions against Manager, directly or indirectly, by any and all parties. E. Manager shall promptly notify City in the event that any of the foregoing acknowledgements, representations, warranties or agreements shall no longer be true. The foregoing acknowledgments, representations, warranties and agreements are understood by Manager to be relied upon by City in agreeing to enter into this Agreement. Unless approved in advance in writing by City, Manager shall not allow or permit any "Hazardous Materials" to be brought upon, stored, manufactured, generated, handled, recycled, treated, disposed, or used on, under or about the Site for any purpose; provided that, Manager may permit the storage and use of general office and landscape maintenance materials for the Site used in the ordinary course of business, such as copier toner, liquid paper, glue, ink and janitorial cleaning solvents. All materials must be used in the manner for which they were designed and in such amounts as may be typical for management operations for the Site so long as the disposition, handling, storage or quantity of such items are at all times in compliance with all applicable laws. "Hazardous Materials" shall be interpreted broadly to mean any substance or material defined or designated as hazardous or toxic waste, hazardous or toxic material, hazardous or toxic or radioactive substance, or other similar term by any Federal, State or local environmental law, regulation or rule presently in effect or promulgated in the future, as such laws, regulations or rules 06•4349105 Page 13 of 20 may be amended from time to time; and it shall be interpreted to include, but not be limited t3D, any substance which after release into the environment will or may reasonably be anticipated to cause sickness, death or disease. 32. NO ASS This Agreement is personal to Manager, and Manager shall not assign, transfer or sell this Agreement or any privilege hereunder in whole or in part, and any attempt to do so will be void and confer no right on any third party. Any purported transfer of control, voluntarily or by operation of law, except with the prior written consent of City, shall render this Agreement absolutely null and void. 33. FORCE MAJEURE — UNAYOIDABLE DELAYS Should the performance of any act required by this Agreement to be performed by either City or Manager be prevented or delayed by reason of an act of God, strike, lockout, labor troubles, inability to secure materials, restrictive governmental laws or regulations, or any other cause except financial inability not the fault of the party required to perform the act, the time for the performance of the act will be extended for a period equivalent to the period of delay and the performance of the act during the period of delay will be excused, provided, however, that nothing contained in this Section shall excuse Manager's prompt deposit of rents and other cash receivables to City as required by this Agreement or the performance of any act rendered difficult solely because of the financial condition of the party, City or Manager, required to perform the act. 34. COMPLIANCE WITH LAWS Manager shall, at Manager's sole cost and expense, comply with all statutes, ordinances, regulations, and requirements of all governmental entities, including Federal, State, county and municipal, relating to Manager's use and occupancy of the Site whether such statutes, ordinances, regulations, and requirements be now in force or hereinafter enacted. The judgment of any court of competent jurisdiction, or the admission by Manager in a proceeding brought against Manager by any government entity, that Manager has violated any such statute, ordinance, regulation, or requirement shall be conclusive as between City and Manager and shall be ground for termination of this Agreement by City. Manager will obtain all permits and other governmental approvals required in connection with Manager's activities hereunder. 35. BINDING ON HEIRS AND SUCCESSORS This Agreement shall be binding on and shall inure to the benefit of the heirs, executors, administrators, successors, and assigns of the parties hereto. The provisions of this Section shall not be deemed to be a waiver of any of the conditions against assignment set forth herein. 36. INTERPRETATION OF THIS AGREEMENT The language of all parts of this Agreement shall in all cases be construed as a whole, according to its fair meaning, and not strictly for or against any of the parties. If any provision of this 06434/4105 Page 14 of 20 Agreement is held by an arbitrator or court of competent jurisdiction to be unenforceable, void, illegal or invalid, such holding shall not invalidate or affect the remaining covenants and provisions of this Agreement. No covenant or provision shall be deemed dependent upon any other unless so expressly provided here. As used in this Agreement, the masculine or neuter gender and singular or plural number shall be deemed to include the other whenever the context so indicates or requires. Nothing contained herein shall be construed so as to require the commission of any act contrary to law, and wherever there is any conflict between any provision contained herein and any present or firture statute, law, ordinance or regulation contrary to which the parties have no right to contract, then the latter shall prevail, and the provision of this Agreement which is hereby affected shall be curtailed and limited only to the extent necessary to bring it within the requirements of the law. 37. WASTE OR NUISANCE Manager shall not commit or permit the commission by others of any waste on the Site. Manager shall not maintain, commit, or permit the maintenance or commission of any nuisance as defined in Section 3479 and/or Section 3480 of the California Civil Code on the Site; and Manager shall not use or permit the use of the Site for any unlawful purpose. 38. INSURANCE HAZARDS Manager shall not commit or permit the commission of any acts on the Site nor use or permit the use of the Site in any manner that will increase the existing rates for or cause the cancellation of any property, liability or other insurance policy insuring the Site or the improvements on the Site. Manager shall comply with any and all requirements of insurance carriers necessary for the continued maintenance at reasonable rates of property, liability and other insurance policies on the Site and the improvements on the Site. 39. INSURANCE PROCEEDS Any insurance proceeds received by City because of the total or partial destruction of the Site or the improvements on the Site shall be the sole property of City. 40. TIlME OF ESSENCE Time is expressly declared to be the essence of this Agreement. 41. GOVERNING LAW This Agreement shall be governed by the laws of the State of California and an and all actions initiated under or as a result of this Agreement shall be brought solely and exclusively in a court of competent jurisdiction in the County of Orange, State of California and no other court. O"-W4105 Page 1S of 20 42. Terri and conditions of this Agreement which by their sense and context survive the termination or expiration of this Agreement shall so survive. 43. CM EMPLOYEES AND OFFICIALS Manager shall employ no City official nor any regular City employee in the work performed pursuant to this Agreement. No officer or employee of City shall have any financial interest in this Agreement in violation of the applicable provision of the California Government Code. 44. I AMGRATION Manager shall be responsible for full compliance with the immigration and naturalization laws of the United States and shall, in particular, comply with the provisions of the United States Code regarding employment verification. 45. LEGAL SERVICES SUBCONTRACTING PROHIBITED Except as expressly set forth in Section 13 of this Agreement, Manager and City agree that City is not liable for payment of any subcontractor work involving legal services, and that such legal services are expressly outside the scope of services contemplated hereunder. Manager understands that pursuant to Huntington Beach City Charter Section 309, the City Attorney is the exclusive legal counsel for City; and City shall not be liable for payment of any legal services expenses incurred by Manager. 46. .ATTORNEY'S FEES Except as expressly set forth herein, in the event suit is brought by either party to enforce the terms and/or provisions of this Agreement or to secure the performance hereof, each party shall bear its own attorney's fees. 47. WAIVER OF BREACH The waiver by City of any breach by Manager of any of the provisions of this Agreement shall not constitute a continuing waiver or a waiver of any subsequent breach by Manager either of the same or another provision of this Agreement. 48. DUPLICATE ORIGINAL The original of this Agreement and one or more copies hereto have been prepared and signed in counterparts as duplicate originals, each of which so executed shall, irrespective of the date of its execution and delivery, be deemed an original. Each of the parties hereto shall retain an originally signed copy hereof. Each duplicate original shall be deemed an original instrument as against any party who has signed it. 06434MI05 Page 16 of 20 49. CAPTIONS Captions used in this Agreement are for ease of reference only and shall not affect the construction or interpretation of this Agreement. 50. SOLE AND ONLY AGREEMENT This Agreement constitutes the entire agreement and understanding between City and Manager respecting the Site and the subject matter, and correctly sets forth the obligations of City and Manager to each other. Any agreements or representations respecting the Site or the subject matter hereof not expressly set forth in this instrument are null and void. This Agreement or any part of it may not be changed, altered, modified, limited or extended orally or by any Agreement between the parties, unless such Agreement is expressed in writing, signed and acknowledged by City and Manager, or their successors in interest. This Agreement supersedes any and all prior agreements, written or verbal, between the parties respecting the Site and the subject matter hereof. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by and through their authorized officers on Oc_ Ta A 0 R . 20 0 6. MANAGER: JOHN STEWART COMPANY, INC. By: �`u-- oves . *&-r-� print name ITS: (circle one) Chairrl�m resider 'ce President M ITS: (circle one) Secretiar��FinancW Secretary - Treasurer CITY: CITY OF HUNTINGTON BEACH, a municipal corporation of the State of California Mayor City Clerk APPROVED AS TO FORM: r ity a -\1 -01P INITIATED -AND APPROVED: Director of Economic velopment REVIEWED AND APPROVED: r Exhibits: 06.434/4105 Page 17 of 20 A. Site Map of location at 18191 Parktree Circle. B. Rent and Security Schedule. C. Emerald Cove Resident's Handbook. D. Maintenance Standards. E. Evaluation Report. F. Request for Proposal and Manager's Response to Request for Proposal dated 7/12/06 06.43"105 Page 18 of 20 r1 EXHIBIT ."A" 09 m A=0wrx= i YRW ft "0 Aw TM-+s fo a ft 29 more - OWW A Aseo INO' r AW RIB l! I fm f L 77,';1 1 EMERALD COVE SENIOR APARTMENTS AFFORDABLE HOUSING STANDARDS TENANT INCOME LIMITS: " 1#OUSFH4I.D SQE VERY LOW WCOME 7a ftaFoC LOIN INCOME Ton%orocY ONE $2$A00 $45.450 TWO SW Aso $51po THREE $3000 $5%400 MAXIMUM RENTS: f# UNITS SITE VERY LOW MAXIMUM IVW MNOMUM RENT STUDIO $wl iT98 ONE BEDROOM $751 �9Q7 `On 1 3, 2003, CIVY Cound daNi wbdOW 50% offhe Cmemid 0" WO (82 urfs) be resbkbd MD kxV dua k ear» ft 50% or I= of Me modan lrwv m, as osbbbW aemusW by HUD, and the rwmkft 50 % of Me unb (82 un fs) be mahtted is #WVWduvls ewnft BO% orless of Me arse med bn kmme, w osbbkW annua8y by HUD, fora n m ofabdyyam .Yi r- ♦ - - � - r r e err _.ter : )�; � :+:�: r •; 1 r •: rt� 'h I',= •,. t, •.r •� ?�: a r h .hf. 1 :i r r ,j �: i, 7"Tr ! � .etc • EXHIBIT "C" L ��••••• •.t� �r�w� A J r..• •A •'ri• .y..:•sil WI�r 0 i,�..:::. .. �a..r.w L.ti.•r iyir�iii • MVM?ALD CONE • RMWEN'CS HANDBOOK I. WBLCOMS Welcome to your new home in EMERALD COVE[ We hope you will soon fcel ~at home" in your new surrouuldings. The prialary Purpose of B1v1RRALD COVE is to provide quality housing for senior citizens. We think you will also discover that it is more thanjust a p to live - - it's a way of living that indudes many possibBities'for malCirtg raw f : friends and Participating in various pleasant activitieL Residency is open to all persons without regard for race, religion, sex or national origin. t . This handbook will answer many questions you may have about your new home and help you get settled. It contains some general information as well as some specific regulations. Please read it carefully and keep it for future reference. f'" - 2. TBE OWNER L WEIRALD COVE is owned by the City of Huntington Beach and is one of the. first of its kind. It is the result of a pioneering effort on the part of the City to provide low cost housing for the elderly. The City, asp owner, establishes policies for residency, approves and monitors the operating budget, and sets the rents. 3. TM MANAG &OW The ENMRALD DOVE complex % operated under an Agreement with a muu- agement company hired by the City. The manygement company is responsible for all operations, programs and Wig, and works within the policies set for& • by the City. MAIL ' s- - The mad is delivered in accordance with US Pont Office rules and regulations. All mail, except larger packages, will be deposited inyour private mailbox. Your mail box number is the same as your apartment number. Private aalboxes tar buildings 2 fit rough 3 are located on Park Varw Lane. • . Mailboxes for buildings 6 through 9 are located on Park Tree Cirde. Mailboxes for buildings 4 and S are located on both streets. Check with the office for the lo- cation of your maHbox if you are living in binding 4 or 3. Your mailing address is as inllows: .� (Your Name) (Your street address and Apt #) .. Huntington Beach, CA 92 1 °V13/01 i . RESIDM- T'S HANDBOOK Omission of your apartment number may cause a delay in the delivery of your mail. Packages that we too large for the mailbox may be delivered to the Office for pickup during Office hours. The Office carrot accept Rimed Neil. r• Note: Be sure to notify the US Post Officeof your new address when movingin or out of the facility. Please leave your forwarding address with the Office when _. morning out 5. THE ADNIIN137l TION .' The policies established the owner and the -to-da operations are admin P� by day-to-day P� istered by the Management Agent high the Adn�3nistrator. The Administra- tor will welcome any and all questions and suggest%ns you may have to imn- prove the quality of We in.the facility. Do& the, , " M P Can yaw and the ' atvwillnevYiWall owSubi i t�din xvr�itir{gand a wxWenmopaum will t _ be forwarded try you. 6 6. BLiSINI S6OMCEHOUM The office is open Monday through Friday. Check with the Office for the daffy . schedule. If necessary, arrangements canbe made.with the Admhdstrafiar for b appoit .11W outside of repIn office k mom. . 7. RPQUnURdE NiS FOR C ONIE41M 1 "135IDENCY It is the hope and intention of all persons involved in the operation of Emerald Cove to do everything possible to belp make your residency here a long and pleasant aTederkm Your lease agreement, along with tills handbook„ spells out the conditions with which you must comply to help make this hope and i aten- M tion come true. r -• L This facility is designed and operated for those who are 60 years of age or older -and who.are filly capable of meeting the terms of the lease. Neither the man- agement company nor the City provides personal or health care services. Each resident must be able to take care of his or her own raeds. This may be acconr pushed by taking responsibility to arrange for someone else to Perm perswal and home manytSCUMMUchores as needed to fulfill the lease hernia. Applicants who are accepted for residency mast sign a statement indicating their antler st mft did this facility Is designed for apartment living, and that if, in the opinion of Management, they become unable to meet the lease teams, they will willingly vacate dveirapartment movin& Pals+ to a fay Mty that can better meet their needs. 2 oy13/oi EMERALD COVE • REMDENrS HANDBOOK 27w C.rtyrulasforow&pancgrsquth,e tfrath isapartmentmustbe one's Dory plaew afra ideam How+ever residents maylwld their apartment dreg two. nuyB wwwhileabsentfarmedicaltmF,, wtandconnvahoca vthatduesnot : exeaeed oneyerar: The advam v peymerht nffull monddyzwd must cmdnue dur- In the alp In can of temporary or limited incapacity, family members may assist the resident is order to mairttain proper care for the resident and his/her #' apartmmmt ht absence of f 2n*y assistardr, there may be 41, r r notarwes where : temporary homemaker services can be obtained through the Orange County .; Public Services Agency (714-7Od4W 0) or Senior Outreach Program at 536-24 . When a resident vacates an apartment and transfers to another faaili for health reasons, and (ben. regains the to maintain full co npliance the tenons of the lease, the person whli be given priority overnewrenial appBw6kne for Liv- ing_ unit in this facility if so desired. Please remember that yerur lease aft refers to your obligation to refrain from behaviar that wM disturb die rights and coaftts of dm residents,. Spedfi- 'h cabby, intwdcation or excessive use of alcoholic dru diamdedl 8�► ilte:gal . � y condue - obscene language and/or objectionable noise or odw eiisturbaictcce by the resident or the guests of a resident shall be sufficient cause for termination of & TERMNATION OF RESIDENCY Residents may terminate their lease agreements at any time by giving a thirty •(30) day written notice of their hVMnt to vacate fl ehr apartment Rent and all ofixx charges, if any, will be paid fivough the vacating date. The City may request a tetvWation of residency w1mm, in the judgment of both • _ the autnagarnent coarpanyand the sty, a person can no Langer live k depend- ently. Every effort will be made to work cooperatively with the resident and the residwes famly in. these instance. Persons who vacate under these conditions and who later become able to livve independently, And who wish to return as a. # i readdeett, will be green priority on dwHunttngfari Besrch *W&gl4 for a living z unit in lids facility.. The3-City reserves the right to enforce termination of oecupane y m accordance with the psoceeiu res described in the.lease and the laws of the State of Calif mda. . a it • :! e+ -� n•jiliq. • 1%7.1 The City wIU make every effort to provide good martagernent which has a genuine concern. for people, coupled with professional connpetency in properly care and fiscal c:oittrol. 3 a/ts/en w EMMLID CDVB RESIDENT'S HANDBOOK Tice b n I Agent hires all staff petsoarwil, who we under the dhvd su- pervision of the AdmIr6hator. Only the has the authorky to w sign dudes. Residents should not give insttuctians to any =Wkyee,'Arvy sW gesdons or requests that the redderds may have about ww* to be done or about staff PermA should )r e made At wnffngdtrecdY to fire *12tarorfilrovo the Budness Offler- Employees may riot accept tips or personal gifts fwm the resident nor ham diek famMea. To do so udgbi: result in unequal service to other residents. All resi- dents are required to observe this regulatIon. The Administrator and staff are to be sensitive and responsive to any gdevam or conVhdrds brought to them by or an behalf of resklenbL Resident numffily meetInVwill beheld. The prone furicLion of the redden tmeeftpwUlbeto plan and wordhuft programs and acdvftkm that wM enrich We wld& the com- pkx. The meedW will also be used as a sounding board for tenaW corcem kVzdtag day-to-day operaSm and tenent poHdes. Qkvances may conte Cur redly from tine tamaaunt to the motor or through aedm by the residents at their monfidy nueftp. All such cancww will be ghrm proper aftenfim by the Administrator. •• A. Every resident is free to express any =mn, w&"fian or Sdevence. However, In m%W to be fmully dealt with, &= =ftws must be put In writing on printed gdevance fasne that we available in the CW= B. ThM wxWen items will fiat be dealt with and resiponded to by the A& mb*fttw. If the reddest Is not sa"ed with the fin- spomeheorshe should request ameeftWith the Management Super visor or any officer of the MainagP,rnentcampaRy- , - C MzwtsetWed WM the zawlbfrvm the convect wM the A--A.W '-0-- xWor dw Manqwent Chotpaw, the zeddent nu r fdo dw MAMW to CwsftffhwzeW&w. 27i*j*Wewwfflbecandudediydie Commun(ty SevicwDepar&amt,aropmmmd*hvmthe ClysRadBaOL-Servxes DhWa� and repromtedvehm the atrAdmkvsftWs COm -T#j • sr-7,9-,;7,7 -�777777 ; 0 1 t M.4f 4;! ATF-I Pr ffit+1NtALD COVET . f , MME"S J � HsM WM r' 10. FlAYMEM OP RENT Vn Your monthly rent payment is due and payable on or before the first day of each month. Rents are overdue if not paid by they day of the month b3r5:00 p.m. A $25.00late charge will be assessed. i. Payment shall be made to the office. Receipts for rent and other payments will be issued as soon, as the item. is posted in the account ledger. Please make sure that you receive a receipt for your rent parymeent. The monthly rent charges are set by zwolutloon ofthe Hrmtir{g m Beach 4aty CvundL ' IL MOVING FROM ONE APARTMENT TO ANOTIM Residents who wish to dwige apt should make a wzi men request to the ' Administrator. When permission is given and a move takes place, a fee of $100 00 will be charged. Payment may be paid in 3 montbly huftdIments of $33.33. Receipts for rent and other payments will be issued as soon as the item is posted in the aacountledger. IM AffiARTMMd g15PBG'1710N sw. L . At move -in or move -out, inspection of each aparmnent will be made by both the resident and Management. Ruts of these inspections are recorded on a farm, that is signed by both parties. This forum becomes a part of the residenes lease ' and is used to determine the basis for damage daims„ if any, upon move -out. ' Manageaus t will also make arrant with residents for addhional mut- ` . a=nnuid inspections of apartments as a maintenatm pmendon measure. 13. — SBCURITY DEPOSIT Each rat will make a security deposit at the time of moving into the hAlUy. l This deposit will be is addition to any rent paid. The deposit will be held intrust by Management and will be returned to full when a tenant vacates an a providing there has been no damage to the apartment, and no rent is owed per provision of the lease. 5 OV" a ' EIGRALD COVE • RE MMrSHANDBOOK . 14. APARTMEM PURNLSi-i'iNGS Residents will furnish their own apartments with the exception of , drapes and major kitchen appliances with the exception of the refrigerator. Any carpets • kitchen or Math flooring, window covering; or appliance changes made by the resident must be approved in writing by the Adonizlistrat!ar. 15. APARTbUM MURANCB The Citq or Managennent carries no h samwe of any kind on the belongiW in your apartment. The resident is enco=ged to' pumbase adequate insunim coverage for such possessions as well as personal liability k= ance to cower atiy claim that mI& arise from accidents o==mg in your apatmntt resulting in U*" to gins or to the building and equipment. C 16. APAR'f'MBNT HONE Sash apartmett is provided with a telephone outlet. If you want tdVb one service, make direct contact wilt: the talephsme cam. There are specific rats for law -use Qeplom service that may be of interest to yuu. If you null a telephome, ply give the office your telephone nuwJ=. Your teiephom nntnber Will not to given out to other persons, but if wM aid the Office T lncmwctkqycu. Nlsitagex nt mIdnt0 ns telephone lh within the walls of the apartment. Faulty i telepbone iiraes within the walls will be repaired without charge provided loss of 4 service was not caused by negiigaue on the part of the resident or by a defect in *.: resident -owned comaramicaSon devices. Requests for telephone line, repair are to be made tiw ugh the Bps Offlre. Iv nageaieat does not accept responsir bllhp for payment of service calls and orlxed by a resident directly to the We- 17. TBLBVi.SiOM AND RADIOS Each aunt is provided with a television antenna outlet. Radio and televi. sion sets should be operated in a manner that will not disturb other residents. This is espedaUy true during "quiet hours^' from 10:00 p.m. to S.M axa. .. 6 04/16/01 .. .. •BIVIfiRALUCAVE ('I . { ' . RESIDENT'S HANDBOOK 18. HOLSHkEMG The maintenance staff will clean and maintain the clubhouse and other pubes ar- eas. Residents are expecW to n whusin their own apartmft with high ohm. dards of sar tation and freddom from hazards. 19 REDSMRATION AND ALTRRATIONS Management will.do redecorat:ian of apartments on a fixed schedule. Reddents t who are not satisfied with the infierior color scheme of their living unit m4y make arrattgenhexhI s for a donge of color acme of tier choice, but at their own ex- pense. It is expected thatthey will also place on deposit with the office sufficient funds to restore the apa t at to the standard color schemes. Although your apartment was designed with safety in mk4 you may feel an altera11 - Unwessa2y to make your home more accessible. Alterations for acoes:- #� sibiility are dbwed at the residenes expense providing the written mquest has been made to the Ad--'-'-- --- and written approval given before work is be. gun. A d� funds sufficient to restore the apart=mwt to standard condition, :.;1 ! :. 1 Yi e< /•.. 1 y r+.�, .:. t `ti1 • a /;11 •Il M • �• . a •7 • '/ =t1ii`-: ) %Y 1 ;I Y1 =+\1 !J ► . r ■ • 1 M t ■ 14 •All requests for maintenance servim are to be made through the office and are to y - be written on a work order form • No verbal requests for such service are to be given to the mahtenarice personnel by residents. F. Maintenance pereound should not be asked to make repairs on equipment or furniture owned by residents during office hours. Z1. REMOVAL OF TRASH AND GARBAGE Residents must not accumulate any trash or waste material so as to create a haz- ard of any kind or to be a violation of any heatlth, safety or fire prevention rule,.. 7 CV1s/m WARALaD CM=D"� RBRDENrS regulation or directive. Residents must keep the rented premises in a clean and rs sanitary condition and free of of Eensive odors. TheTheh bW are well located and easily accessible from eachbulding. There are a ? • tDtal of five (5) bins for your use. Any "wet" garbage placed in the bins should. be securely wrapped in plastic bags. cardboard boxes AKwId be aiearnantled to conserve space. Ga baee fvosal units are in every apartmnt sink. All wet garbage should be disposed of through tUs unit jamo such things as paper, corn husks,, pats, barrel and other hard or fibrous hears, which should be carefaily wrapped, placed in a gaUpbag and placed in the trash bins as noted above. turn on the cold water W= turning on the disposal, and alw_ ays leave the water running fir a minme or two Aft tarning off the disposal. 22. HBATING SYfir M Each apartment hM its oven individual unit for providing heat. 11w Manage- ment Maintenance Staff gives you by truccttons when you move in, and should be consulted in case of malfunction of the heating system. 23. USE OF PUM IC A ?R Public areas are for the use'and enjoyment of all residents. The CluNwuse is available for casual resident use frown 9:00 a.m. urn319:00 pan. unless a scheduled program is in sewiim Smoiangg is permitted only in one's own aparbuent. Smoking is prohibited in all other areas hwkx ing staizmses and con munity spaces. X -USE OF LAUNDRY r Coin -operated dryers and washing machines are located in the Clubhouse, ` Rest- dents are requested to dean lint filters alter each use. It is expected that residents �• will develop their own schedule so as to provide equal oppa nunity for all to use - the laundry fiiliities. As a courtesy to other residents who may be waiting to do their laundry, please be sure to remove your laundry frown the appliuw a hm ne- diately after it is washed or dried. Your aasistanve in keeping the laundry zoom clean and in order will be appreciated. 25. DIMS IN PUBLIC AREAS All residents are expectedto dress rtppropriiat+dy inall public areas. Please - - no bathrobes, bare mkidffs, short shorts, etc. 9=4 E1MALD COMB t RBSMEM HANDBOOK - 26. PARKING The parking areas are fot use of reddaft and staff only. Residents who use the parking area do so at their own risk. Arrargemerits for a parking space should t be made through the office. Guests must park to clearly marked visitor parking spaces or outside the fang area. 27. IMPONISB lil O F24MG'ENCY CALLS . i J If you fed you have a medical emergency, the fastest way to get help is to dial 1 911. You may also contact a project staff member anytime by dialing 80-08M Staff wdl respond as quickly as possible to an emergency call. Safi will aid the resident in calling for professional or family help, if may. It should be noted. that NO doctors or nurses are on call at the fatty. 28. RMERGENCY INFORMATIO PME >r,With your aadstance, the offim keeps an enwrgmcy Wommflon Me on each frt residentfile has 1Inforination on. your ... uiti • t preferred •s r riff By contacts, as well as infornudlon about your general bed& Your help is needed If •..! ' ow file Y f Yf f :If !I ,'r :JI .=,! ri Me '{ ! na •� r • !r . n NI •a r ! •1-%--+ r ! i of the -r,Ya,.:: % i 29. DAILY CHBM ON RBSII )UNW HEALTH AND WBLL BEING Although this facility is designed far independent Uvki& it is reassuring to know 1 that saarwoQe ores about your well being. Residents should his m the Office ` when they leave the complex for an odended period. Residents are encouraged to adopt a "buddy' system with a neighbor. 30. APARTUMT SBCURM f For your own safety, keep your apartent locked at all tunes. No resident shall j alter or replace aparton,xt locks. ititanageFnertt must be able to enter apartments with a passkey in times of emergency. For this same reason, residents are not to install chain locks on aparbnt doors. Swept in ens xgeri4 s, in - and repairs will be made on a scheduled basis Vd& proper edwwce Maim While we are happy to aeconnawdabe an occasiond lock -out, repeated key loss will be charged for. .. 9 u+Vtsim • . • SMSRAM COVE k RESIDENT'S HANDBOOK 31. RMUDFRS,1Z3BfeT OR VANDALISM If you suspect that someone is in or about the budding who should not be there, or if you see someone convrdtting acts of theft or vandalism,, &a CELL 9-1-1 and report what you suspect - - tbm contact the Office immediately. 32 EeIRB • - In compliance with Tide 19 of the State Fire Code, each building has been fur- ,,, nis%ed with a fire eodlulg ddw located at the bottom of every other st chweli. � Remember, Emerald Cove lai been dedgned as a fire resistant facility. Should a fire ocemr, it would normally be limited to furniture and hvnWaugs in your aparint or in the building The Hintington Beach Fire Department provides periodic fire safety wmkkshops in tine clubhouse for our resklen& • In ad- entice, the Fire Safety Officers will carAut a voluntary safety walk through each residents apartment in order to alert the resident to potential fire hazards. We encourage you to talm advantage of this potentially We saving servim 33_ GUESTS ' Your apartment is your private residence. You are.weleomo to have guests in your home. Guests are also welcome in the recreational areas when accompa- nied by a resident. As a courtesy to other residents, be sure that ciu`ldren visiting you are properly supervised. ` Remember that the resident wilt beheld directly responsible for the acticros of all their guests. Guests must comply with all the property rules, including but not limited to, hose rules pertaining to DOW, parking, and Feu• KA In accotdanoewith our regulatory agreement, octupaney of your unit is linufed to qualif ed persons reamed an your lease. Residents may have overnight visi- tors; however, the resident is required to notify management on tine day the Yhow arrives. A visitor may not became on unofficial roommate or an unau- thorized iesidern. An orixed resident is: b A visitor who stays wkhout timely =Mcatiop to manag t by the real- : dent D Lvisitar about wham the — t bas been noticed but slays longer than the notification period; > A visitor who stays longer then 21 days in any 12 month period without prism . written autiuorization Eroom management. _ j0 .oslulca • EMERALD COVE (,i. ' . RESIDENT'S HANDBOOK 34. SOUCMATION In order to protect the residents within the facility, there is a NO SOUC rATION POLICY in effect. If anyone observes solicitations of any kind, please notify the r" Office immediately. 35.-RESIDRUACTIVITMS Residents are invited to participate in any social activities occurring in the public areas of this facility or on argadzed field trips. All participation is os npetely s voluntary. Should you have any summons regarding social activitiesy please contact the Office. 36 BALCONl]3S AND PATIOS t If you have a balcony or patio, please use it as a pleasant additional living space and at as a storage area. You are welcome to place appropriate outdoor furor tore and plants in your patio or on your balcony. Plants must be placed in pots with receptacles so that water will not drip on the balcony below. Please do not hang laundry or other unsightly iten s M the patio or balcony rails. axe not permitted becsauae of sawke and odor problem for neighbor- ing apartau+nts An off -write ndl" shade may be pe dtt�, with manage- �. went approval, to be attached to your overbang to keep out the hot sun i. Please refrain washing or sweeping over the edge of the balcony, or shale ing dust mops or rugs over the fail,, as this causes inconvenience arA hazards for peaplebelow. 37. P$1"5 r Small pets are allowed providing they are registered. A security deposit is re - ZIP gaixed. As►tuuegistezed pet, inctuding visiting pets, is prohibited. 'Pet rotes and fotms for registeation an avadabie in the office. - W. CARWASHING Because of the Hn*ed space between ears in our resident parking areas and problems arising from splashes and over -spraying on neighboring can, cars must not lie wasived within the BMHRALD COVE complex. 11 - oohs✓m EXHIBIT "D" (AA! Emerald Cove V General Maintenance Standards • Lawn Maintenance. a. HWU - Lawn should be mowed weekly at a height of 2 K inches or as _ appropriate curing the aetive.growing season and 2 inches or as -needed dmt3g the winter months. During the winter months. lawns will be mowed on an as needed basi% weather pmdttiag, Lavine will be kept up adaft a wd maintaiued appearanft b. fA" - Lam borders along sidewalks vfII be edged on a regular basis with the mowing sdxdule. Lawn borders around flowerbeds will be t edged bb+eY and supplemented by systemic herbiddes. C. E 8- Application, h quency to be a mirdmzm of four times per year or as required to maintain a healthy turf euvIv anent. Fertilizer is to be a high ,grade. balanced organic bl=4 web as Turf Supreme 16.E-8 or d. Weed�co Ud - pre emergent weed control shad be applied a mbitam of two tomes per year for broad leaf cm U*& C. Anumm,- Lawns will be serified twice per year. f. nWd&Z ad IM RM=Um - Upon reWests. lawns shall be thatdied and renovated. I� IL. Trees t ftmtpg.of trees and slimbs under 12 feet sballbepmued an=Ay durfug the dormant season. b. Suppler pruning and hedging will be done on an as -needed basis tbrougthout the year. C. Trees shall be homed to keep then neat, healthy and to proem obstrucdon to pedestrians. vdddes and Doting. Pruning sW be done € _ selecxl * to enhance the natural form of the plant nnaterM _ UL Shrubs Q. Shrubs will be pruned and trimmed on an asieeded basis to keep all �- sinubs neat.. dean seed bealft and to prevent obstruction to pedestiiaons. . --vehbdes and 3ightfiog. -. . • b. Muvbs "be staked and tied as needed to support desired grorwth;Md y develapmew. z ' N ground Cover ice a. Ground cover shall be edged to keep from spreading over w4 ways. curbs or up wails and feaces unless ofinerwist stated by city. b. weed =yA - Ground cover areas will be weeded and cleared of AU debris on a regular basis to mafnfn a um and d�eaa appearance. Emerald Cove General Maintenance Schedule V. hilgation, Maintenance 2L Clock Sc=g - Irrigation docks shall be set and adjusted accordtog to the seasonal water requf=ents, quantities and frequendes consistent with. seasondftqpirement of plant materfal and landscape atas aud aoordtag to diinges: In weather, trjAqF= SLIALC alzmrdn fall, etc. b. Rewim - The repairing maintenance- of the trrigallm controller, electrical whing and pressure -pipe ftm the meter to the distribution valves WHI be the respbnsMtv of the contractor and be performed on a time and material basis. VL Walkways Wallmws shall be kept neat and cleaned. All apft graffiti and trash shall be remooed. immediately. WaUMM "be inspected on a regular bats and aay uplifting or MMW Imues associated with wallomys sha be reported to the city immediately. VIL. U*Wng Maiat, a. All lfgb shall be inspected an a rqpW basis. b. All secmdty II&Ing and walkway path lighting shall be replaced Umedfatply whm I%hft goes out - C. Any major n0wenswe associated with I%hdAg repair shall be reported to the dly. ftmedlately, Veit. Parking Parking lot shall be inspected on a regular basis. All trash and debris shall be removed from the parking lots. Puking lot striping shall be maintabed In a manner that preve= labft. An pmking areas shall be kept neat and cleated. Office areas shall be kept neat and deaned. There shall be an attracdn offtee mektafned for access by residents. X. Clubhouse L Clubhouse shall be kept in a neat and orderly fashion. b. Carpets shall be deaned daily. c. Posters, fliers, etc shall be maMtWhed to a manner so as not to clutter the clubhouse. Equipment such as teleyWws, chairs, tables, etc- dWI be kept In good wmidng order. XL Lmmdry Maintenance a. Laundry room shall be kept neat and cleaned. b. Laundry room shall be inspected daily. 2 . 1 • . ' Emerald Cove .� . Gem al Maintenance Schedule r+ • LWa. r C. Posted hours shall be dearly visible. d. Machines shall. be kept in good worldng order and repair. Patio Maintenance a. Patios shall be kept dean and free. of debris. b. Tables and chairs shall be matukned so as to be safe and attractive C. Patios areas shall not serve as storage areas for mW equipment, etc Restrooml Maintenance a. Resnvoms shalt be cleaned periodically as needed. b. • Restrooms shall be kept in a dean and neat state. C. Ail ffifiures shall be maintained so that facilities work dispensers are to be kept ib11 and paper towels shall be kept available. XV. Trash Areas a. Ali trash areas sha11 be maimed in a neat and orderly manner. b. Buns shall be kept free of grad. C. Inspections shall be dare to insure that bias we not ovedilled. d. Cont factors shall insure that trash bins are picked up on a regular basis. XV Pest Control insects, Pests and Disease a. Contractor shall apply a material required to help with cbntrolliug insects and disease b. If pest wntrd is done wader contract with a third party, city shall conu-= for Pc. Proper notification of repellents and pest control systems shall be given to all residents. XVL Apartment Bwildffg Malnteaanoe a Apauroment bullftigs shall be kept In a clean and visually pleasing• state. b. Painting of apartment building hickkDag towed up work. dew*e etc. . shall be performed to keep apartment bufldtgs visually attractive. A mWd== number of ten points shall be awarded with each maintenance area. Contractor m m�aintafn a 70 percent score or better to not be is default of m� management cenbact. 3 EXHIBIT "E" l ) City of Huntington Beach Emerald Cove Evaluation Report Month Year TodWs Date _ K ' i_ inspected $y t • V s / lit It Total Points Earned (160 matunm) Score (Total Points Earned f 160) Received By Emerald Cove EXHIBIT "F" Exhibit F MANAGEMENT SERVICES PLAN BACKGROUND AND PROJECT DESCRIPTION The Emerald Cove Senior Apartment Complex (Complex) was constructed in 1984 as affordable housing for low and very low-income senior citizens (60 years or older). The Complex has 164 apartment units--32 studios and 132 one -bedroom units --which are grouped into nine buildings. The Complex Includes one manager's unit and a recreation building for use by all tenants. All persons living in the Complex must be able to care for themselves and live independently, and must qualify as low or very -low Income according to U.S. Department of Housing and Urban Development (HUD) income standards. Since 1984, the City has contracted with two different property management firms, utilizing a management agreement that is negotiated every five years. The management firm will be expected to provide for the complete maintenance, repair, and operation of the facilities. Additional expected services include recreational activities, limited counseling, 24 hour on -duty staff presence, and rent collection. Because an exterior renovation project is scheduled to begin in the near future, the selected management company will provide a "tenant in place" program as defined by industry standards for construction -repair projects. The Complex is subject to walk-through inspections by the City on a monthly basis. MANAGEMENT QUALIFICATIONS To ensure a high -quality level of operation for the Complex, Manager has Indicated a sufficient level of experience and qualifications of the following: • Experience in successfully operating and managing a similar type of property for a minimum of five (5) years. • Fiscal solvency and capacity to manage and operate a 164 unit housing complex. • A minimum of at least three (3) years experience managing a property with affordability restrictions. • Demonstrated track record of being an equal opportunity employer. The management firm chosen will be responsible for hiring the necessary qualified personnel to manage the Complex. The operator will comply with all federal, state, and- local laws related to minimum wage, social security, nondiscrimination, ADA, unemployment compensation, and workers' compensation. • Must not be currently indebted to the federal government, State of California, or the City of Huntington Beach for non-payment of taxes, fines, judgments, liens, or fees. In general Manager shall provide the following: a. Custody of books and records for the Complex b. Custody of on -site personal property owned by the City (owner) c. Collection of rentals and other payments due from tenants d. Payment processing for goods and .services and expense reimbursement processing associated with the operation of the Complex e. Regular monthly remittance and reporting of financial activities of the Complex to the City (owner) f. Development and submittal of annual operating budget for the Complex g. Administration and enforcement of leases and related instruments associated with the Complex or the management of the Complex h. Development of a tenant retention plan i. Maintenance and repair of the Complex j. Development of a preventative maintenance program for the Complex k. Providing of accounting services within a uniform chart of accounts as provided by the City I. Compliance with governmental regulations m. Supervision of onsite personnel n. Training of employees to ensure that employees are current in fair housing and operational requirements o. Marketing and advertising of the Complex p. Identification of needed capital improvements and Implementation of approved capital improvement projects q. Establishment of life safety procedures and testing program K The above requirements are provided in more detail in the Management Agreement, and/or -in this Exhibit. Certain procedures and plans detailed above have not been developed as of the date of this agreement. Any such procedures and plans shall be developed and/or implemented within the time frame and substantive requirements of the City. 3 MANAGEMENT SERVICES PLAN (CONTINUED) PROJECT NAME: EMERALD COVE APARTMENTS PROJECT LOCATION: HUNTINGTON BEACH, CALIFORNIA OWNER NAME: CITY OF HUNTINGTON BEACH MANAGER: THE JOHN STEWART COMPANY Development Description Emerald Cove Apartments is a 164 unit senior tax credit apartment complex located in Huntington Beach California. The property is spread over 4 acres adjacent to Terry Park. The property has a central recreation center, which houses the rental office, laundry facility and community room. Statement of Management Policy The goal of The John Stewart Company is to ensure Resident satisfaction, and the long-term financial and physical well being of Emerald Cove Apartments through the provision of high quality tenant relationships and management services. Toward this end, this plan has been developed to set forth the relationship between the Owner and the Manager and to describe in detail the policies, procedures and regulatory requirements to be observed in the management of the project. Specifically, the plan intends to outline a definite program of action to assure: 1. A well managed and properly maintained project. 06-434/4449 1 2. A pleasant, healthy, and secure living environment for the Residents. 3. A pleasant relationship among the Residents, the Manager's employees, and members of the surrounding community. Unless otherwise stated in the plan, the term "Owner" will refer to City of Huntington Beach. The term "Manager" will refer to The John Stewart Company and the term "Project" will refer to Emerald Cove Apartments. On at least an annual basis, Manager will review this Management Plan with Owner and the on -site manager to determine whether any changes are required as a result of lintited paFtaeF either procedural changes or new laws or regulations affecting Project management operations. Any proposed changes will be incorporated in an updated management plan and be forwarded to the Owner and for review and approval. I. MANAGEMENT A. The Manager, based on previous experience with effective management practice, shall provide advice and recommendations to Owner to establish general policies for the operation Emerald Cove Apartments. Such policies shall include, but are not limited to: Resident selection criteria and property guidelines, eviction policies, house rules; security and emergency services; social services; allocation of parking spaces; and cash handling procedures. Once the policies have been established by the Owner, the Owner shall delegate authority to the Manager to implement the policies. The Manager will, by means of periodic budgets, financial statements, and status reports, advice the Owner on the operation of the Project. In addition, the following procedures shall be followed to 06.434/4449 2 ensure effective day -today operations and cooperation between the Owner and Manager: 1) Day to day operation of the Project will be under the direct supervision of the Resident Manager who will report to the Regional Manager of the Manager. 2) A senior management person shall be the Manager's representative in reporting to the Owner. 3) The Owner shall appoint a key contact person or liaison to represent the Owner in regular communications with the Manager. 4) There will be regular meeting times between the Owner and the Manager for the purpose of reviewing policies, management procedures, resident relations, and budget control. Owner and Manager will work jointly to establish any changes in the policies and procedures. Should it become necessary to alter these policies, the Manager will not do so without the prior approval of the Owner. 5) To the extent practicable as determined by the Owner, Owner's concerns and suggestions shall generally be communicated to the Manager's senior management representative or Regional Manager who shall issue instructions to the Resident Manager. a. As described in the Management Agreement, the Annual Operating Budget for the Project will be prepared by the manager and approved by the Owner. In the event that items need to be purchased that either o6-aM409 3 were not budgeted, or that would bring the Project over budget, the Manager will promptly inform the Owner, who will review and approve such additional purchases in writing. In the event that the Manager must arrange for emergency repairs involving manifest danger to persons or property, or make payments required to avoid suspension of any necessary service to the Project, the Manager will inform the Owner of the facts as promptly as possible. b. In the event that the Owner or Manager shall terminate the Management Agreement the Manager will transfer all files and records related to the Project to the Owner. These files shall include marketing and rent -up materials, prospective tenant applications and documents relating to the management of the Project. c. Personnel policy and staffing arrangements Once the personnel and staffing requirements have been established by the Owner and Manager, the Manager shall hire, train, pay and supervise all personnel, including independent contractors and other service providers. 06434/"49 4 B. The anticipated staffing pattern will be as follows: itl / siti 'on Resident Manager Per approved operating2perating budget Full Time live on site Maintenance Person Per approved operating budget Full Time Assistant Manager Per ME9ved operating budget Full Time Janitor Per approved operating bud et Full Time *A rental unit is part of the Resident Manager's compensation, and is counted as income and expense. The Resident Manager's unit is subject to local, state and federal tax regulations. The on -site manager will report to a Regional Manager who, in turn, reports to the Vice President of The John Stewart Company Southern California Regional Office. C. Specific responsibilities for all project personnel are detailed in the job descriptions, which shall be provided to Owner. 1) Hiring Policies a. All hiring of the John Stewart Company employees shall conform to Equal Employment Opportunity requirements. The John Stewart Company shall not discriminate against any applicant for employment because of race, religion, color, ancestry, national origin, or age, sex, pregnancy, marital status, disability, sexual orientation or AIDS. b. Special efforts will be made to provide information regarding job openings to minority candidates and contractors through outreach to community organizations, bulletin boards, newspapers and other communication media. All hiring materials will indicate the Emerald Cove Apartments is an "Equal Opportunity Employer." 2) The John Stewart Company believes in hiring personnel with previous experience in their particular field. Nevertheless all personnel will receive training specific to The 06 43M4449 5 John Stewart Company's policies and procedures. This training will include the following: a. One-to-one counseling and supervision on the part of the Regional Manager of the Project. b. Written guidelines, manuals, and materials. i. Periodic attendance at special training workshops sponsored by various property management associations for the purpose of updating and renewing work -related skills. 3) As indicated in the Management Agreement, all on -site personnel shall be employees of the Manager. However, compensation payable to on -site staff and service providers, and for all taxes and assessments incident to the employment of such personnel will be treated as a Site expense and paid out of the Emerald . Cove Apartments General Operating Account. 4) Employment grievances, termination of employment, and promotions shall be conducted according to the Manager's personnel policies and procedures, which conform to equal opportunity and affirmative action goals and requirements. D. Plan for maintaining adequate accounting records and handling necessary forms and vouchers. 1) Financial accounting, reports and records shall be in conformance with modified accrual basis accounting procedures, and responsible to the guidelines provided by the Owner or regulatory agencies connected with the Project. Accordingly, the Manager will maintain accurate files of all Resident transactions, revenue, and 0"3V4"9 6 expenditures and prepare for the following monthly reports for the Owner's review and send it to Owner within 30 days after end of month. a. Cash status report and financial summary b. Monthly and year-to-date budget comparisons c. List of disbursements d. List of accounts payable e. Vacancy report f. Bank statements with reconciliations g. Certified Rent roll h. Balance sheet i. Income statement j. Copies of all invoices and receipts associated with expenses for which reimbursement is being requested. k. Accounts Payable Aged Summary 1. Budget Comparison and Cash Flow m. Resident Prepayments n. Check Register o. General Ledger 2) Bills will be paid and accounts will be funded pursuant to the requirements of the Project's Management Agreement and Huntington Beach Charter and Municipal Code. Specifically: 06-434/4449 7 p. A purchase order system will be utilized to document all project expenses with the exception of items and services provided on a regular contractual basis (utilities, trash removal, service contracts, etc.) q. All purchases shall be pre -approved by the Manager's Regional Manager in writing. r. Invoices will be matched with outstanding purchase orders by the on -site manager, reviewed for accuracy by the Regional Manager, and then vouchered for payment by the Manager's central office. Checks will be processed semi-monthly or as required by Owner for payment of any payables on hand. s. The following separate accounts shall be established: i. "Emerald Cove Apartments", General Operating Account into which rent and other miscellaneous income will be deposited and from which the Project's operating expenses will be paid. ii. "Emerald Cove Apartments Security Deposit Account" to be funded by the Resident's security deposits. Policies and procedures for administering this account are noted in Section I (C)(6) below. iii. All project financial records will be audited annually by an independent CPA firm and provided to Owner within 60 days of completion. 3) The Manager maintains a computerized General Ledger program, which shall be continually updated to meet the accounting and reporting needs of the Project and to produce a quality audit trail. 0&4-W4449 8 a. Careful monthly monitoring shall allow for cost control, prompt identification of potential problems and sufficient lead-time to develop plans to meet project needs. b. Major budget variances shall be reviewed by the Manager with the Owner and appropriate actions shall be taken to ensure that monthly cash flow is sufficient to meet the Project's operating expenses. 4) In order to ensure strict compliance with all regulatory restrictions herein, the Manager will systematically review all of the Owner's pertinent Regulatory Requirements and establish a manual of instructions, schedules and tickler files indicating relevant deadlines, reporting formats, etc. This manual will be distributed to all bookkeeping and accounting personnel on the John Stewart Company staff, and to any accounting firms hired to provide audits or other reports for the Project. 5) Vacancies and rent losses will be noted and recorded on the balance sheet summarizing monthly financial activities for the Project. Such losses can also be inferred for the monthly variance reports indicating budgeted versus actual rental income. 6) Security Deposits a. Residents shall be required to make a refundable security deposit in accordance with the terms of their leases and applicable state and local laws. The security deposits shall be held in a separate interest bearing trust account with a depository insured agency of the federal government or a comparable federal deposit insurance program. The balance of this account shall at all times equal or exceed the aggregate of all outstanding deposits. 0& 434/"49 9 b. When a unit has been vacated, the manager will perform a move -out inspection to determine any damages to be corrected or cleaning necessary over and above normal wear and tear, which shall be charged against the security deposit. A Resident may, but will not be required to, participate in the inspection. The move -out inspection form will be compared to the move -in inspection format to determine the extent, of Resident caused damages. c. Within 21 days from the day of the move -out, a security deposit refund will be completed in accordance with applicable state and federal laws, indicating: i. Security deposit on hand I Amount of interest earned, if applicable iii. Amount of rent or unpaid charges owing as of the date of the move - out. iv. Amount of damage or cleaning charges to be assessed. An itemized list of work and actual costs will be attached to the forms for repair, cleaning or replacement of items above actual normal wear and tear. The balance of the security deposit and interest after deductions for outstanding rent charges, cleaning and damages will be refunded to the Resident with the move -out inspection form and itemization of costs. iv. As part of the Resident orientation interviews, Residents shall receive an explanation of the use of security deposits, and shall sign a security deposit agreement. 7) Year -End Audited Financial Statement 06-434/4449 10 Manager shall work with the Owner's independent third party auditor to insure that the audited financial statement and tax returns are prepared in an accurate and timely fashion. The audited financial statement and the tax return are due no later than 75 days after the close of each fiscal year. E. Procurement of contract services 1) At least three competitive bids will be sought for contract service over $500 such as landscape maintenance and services related to periodic capital improvements (exterior painting, roofing, etc.) 2) The Manager shall prepare such bid specifications and supervise the bid proposals and acceptance procedures. In the event that items need to be purchased that either were not budgeted or that would bring the Project over budget, the Manager will promptly inform the Owner, who will review and approve such additional purchases. E. Insurance U. Per the Management Agreement, the Manager will report, investigate, and pursue the resolution of all accidents or claims in connection with the operation of the Project. OCCUPANCY A. Plan for Sustaining Occupancy Emerald Cove Apartments is a fully occupied apartment complex. Based upon the demographics of the existing resident to date, it is not anticipated that any household will be relocated to comply with regulatory restrictions. Units shall be marketed in accordance with Affirmative Fair Housing marketing guidelines, and the following resident selection criteria. 0& 434l4"9 11 1) Application Process: The units at the complex will be rented in accordance with the property's Regulatory Agreements. Screening shall be performed by the Resident Manager in accordance with the following procedures. a. Applications will be stamped, dated and numbered as they are received, and then sorted for family size, income level and eligibility status. Even ineligible applicants shall receive a number in case they become eligible in the future. b. Applicants will be processed and selected in the order in which completed applications are received. c. Separate lists will be established for each unit size and income designation. In order to ensure adequate number of applicants for each income category and unit size, twice the number of eligible applicant households will be processed for each unit. Applicants will be placed in the order of their "dated" number. The remaining eligible households will be put on waiting lists, (by unit size, income designation and floor level desired) and shall receive a letter informing them of their status with an estimate of when the next unit of the size, income designation and floor level they seek, based on previous turnover history for the Emerald Cove Apartments , may be available. d. Ineligible applicants will be advised of the reason for their ineligibility and their right to appeal this determination. 2) Both public and private community agencies will be used as referral sources for notifying a representative number of the area's general population of the availability of the assisted housing at Emerald Cove Apartments. In addition, local newspapers, radio stations and other media will be sent press releases and marketing material, and 06.434/4 49 12 be used to place classified advertising as necessary, all in accordance with the City's policies, regulations and the Management Agreement. 3) Procedures will be followed to assure that waiting lists are current and have adequate number of applicants for each income category. Such procedures shall include the following: a. Separate lists shall be kept for each income category with a second reference to the floor level desired. b. Applicants will be instructed to notify Resident Manager of their continued interest at least twice a year. c. A postcard will go out to all applicants on the waiting list every 6 months, asking them to advise manager of their continued interest. 4) Resident Orientation Shall Include: a. Written orientation material including general information about Emerald Cove Apartments, a list of emergency numbers for hospitals, ambulance, fire emergency procedures, as well as neighborhood services and amenities. b. Personal interviews with every Resident in order to acquaint them with the physical layout of Emerald Cove apartments and the location of fire alarms, fire extinguishers, and fire exits, as well as a review of fire precautions and evacuations procedures. c. A thorough review of the House Rules & Regulations, as contained in the Emerald Cove Resident's Handbook, with each and every Resident. In addition, at the time the rental agreement is signed, all provisions of the rental 0& 434/4"9 13 agreement will be thoroughly explained and each Resident will be provided with a copy of the agreement. d. Inspection of each dwelling unit by the Resident Manager and new Resident(s). At this time both parties will sign a checklist of the unit's condition. Written instructions will be provided to all Residents explaining the use and care of all appliances, maintenance and service request procedures. e. Orientation and orientation materials will be provided in the language of the Resident if the Resident in not fluent in English whenever possible. B. Procedures for Determining Tenant Eligibility and for Certifying and Annually Recertifying Household Income and Size 1) The Manager shall apply all Emerald Cove, State and Federal requirements in determining tenant eligibility at initial rent -up and during subsequent recertification of tenant income. 2) When filling a vacancy, initial eligibility of prospective Residents shall be determined by the following procedures: a. A brief conversation by phone to determine if the applicant household meets minimum eligibility criteria. b. Personal interview. c. Prospective Residents who have been determined to be ineligible will be so notified so that they will have an opportunity to provide further information if they feel an error has been made on assessing their eligibility. d Actual eligibility will be determined as follows: 0"3M4"9 14 i. Each prospective Resident shall complete an application form and return it to the Resident Manager with signed permission for third part verification of income. I When an applicant's name nears the top of the waiting list, pertinent information will be confirmed as current and third part verification letters are sent. iii. The Resident Manager shall conduct a personal interview with all members of the prospective household, and if necessary, conduct a home visit. iv. Third party verification forms will be used to compute income eligibility and a determination will be made concerning applicant household's ability to live harmoniously within the Emerald Cove Apartments. v. Written notice will be sent advising applicants of their final eligibility status. 2) The annual tenant recertification procedure will be as follows: a. A "Tickler File" will be kept on the move -in dates of all Residents. All residents will be recertified on an annual basis within twelve months of their initial move -in date. Also, within twelve months of the initial move -in date, Residents currently being charged less than the rent determined by the Owner and HUD for their income level and unit type, will receive, on an annual basis, a 2% rent increase until such a time that their rent is equal to the rent currently being charged to new Residents at their 06434/4449 15 same income level and unit type, as outlined in the City's Regulatory Documents for the Project. b. Ninety (90) days prior to their recertification date, Resident will receive a letter advising them of their impending recertification date and asking them to sign the release portion of the third party verification forms and complete an application for recertification. These will be forwarded to the appropriate third parties. c. Sixty (60) days prior to the recertification date, the Resident Manager will review the income information and determine the continued eligibility and income status of each Resident due to be recertified, and schedule appointments with those Residents. d. Thirty (30) days prior to the recertification date the Resident Manager will interview the Residents due to be recertified in the following month. At this interview the Residents will be advised of any changes in their eligibility and income status and/or rental obligation. 3) If a household exceeds their units income level and are eligible to move up to next income level available at the property, then every effort will be made to transfer the tenant eligibility of their unit to another one if one is available. If one is not available then they will be given a notice stating that they are over qualified and that they will need to move out within 60 days, subject to applicable law and the City's Regulatory Documents for the Project. 4) Tenant occupancy standards shall be established and implemented in accordance with State and Federal regulations, and other policies established by the Owner. These standards are outlined in the Emerald Cove Apartments Resident Handbook and the City's Regulatory Documents for the Project. Special occupancy procedures include: 0"34l4949 1 16 a. Tenant Death / Incapability Emerald Cove: Occupants may be required to name a conservator in the event a Resident dies or becomes disabled while an occupant of the Project. Procedures will be included in the rent -up process to obtain the name and telephone numbers of an organization or individual to notify in an emergency. Depending on the situation these could include law enforcement authorities; social service / welfare agencies, including legal guardians and/or conservators; attorneys; the Social Security Office, or local or state agencies on aging. b. Live-in Personal Care Attendants: A household may require attendant on as temporary or permanent basis to assist in the care of a household member. In such circumstances management will indicate the attendant's occupancy in the unit, the limits of the attendants' obligations, and the exclusion of the attendant's earning from the household's income for rent calculation purposes. c. Changes in Household Size: If there is an increase or decrease in the number of household members or adults, this must be noted on an amendment. The size of the unit occupied and the eligibility income is based on the number of persons in the household. F. Rent Collection Policies and Procedures The Resident orientation information (both written and oral) for Emerald Cove Apartments shall address rent collection policies and procedures. Such policies and procedures shall be strict, consistent, easily understood, and firmly enforced. This information will be provided to all Residents at move -in as well as to all management staff and its Owner. 1) Rent payments are mailed or delivered to the on -site manager of Emerald Cove Apartments. 0"_W4449 17 2) All rent will be due and payable on the first day of the month but in no event later than five (5) working days after due date. Method, time and place will be made clear to the Residents and will specify that payment is to be made on -site either by check or money order. Cash will not be accepted. 3) Rent collections will be deposited in the property's operating account on a weekly basis. 4) Rents not received by the fifth (5d) of the month are considered late and will be dealt with through personal contact by a representative of John Stewart Company, and a written notice of delinquency will be sent. If the rent is not received by the tenth (10"), The John Stewart Company will pursue unlawful detainer actions, with the consent of Owner. 5) Partial rent payments (except for pro -rated rents involving a mid month move -in date) will not be accepted. However where the Resident is receiving a Welfare or Social Security check, the Resident's payment schedule may be arranged accordingly. G) Should Resident cause damage to the Premises in the course of his/her tenancy, the Resident will be billed for the repair of such damages when they occur, in order to avoid using the Resident's security deposit for payment. These damage charges will appear on the Resident's file and will show a tenant invoice as a balance due until paid in full. However should these charges still be owed when the Resident vacates the unit, such charges will be deducted from the security deposit refund. 7) Residents having financial problems that affect payment of their rent may be referred to an appropriate social agency for assistance with remedying their problems. 8) A fee of $25.00 will be charged in connection with any rent payment not received by the fifth (5`) of the month. These late fees will be collected without exception. 0& 43V4"9 18 9) A service fee of $25.00 will be charged for returned checks. Following the occasion of two (2) checks being returned by the bank, rent payment by cashier's check or money order will be required for the following two (2) years. G. Procedures for Appeal and Grievance 1) The Manager shall enforce the terms of the Residential Lease as they apply to the eviction policies and procedures. All such eviction policies and procedures shall be consistent with any applicable City policies. 1. a. Cases involving nonpayment of rent shall be handled as follows: i. As stated above in Section H (C) (7), Residents having financial problems that affect payment of their rent may be referred to an appropriate social agency for assistance with remedying their problems. A list of social service agencies shall be maintained in the Resident Manager's office and will be made available to all persons seeking assistance in financing services. Any rent payment workouts resulting from the above will be in writing and signed by the Resident household. Such documentation will become part of the household's permanent file. ii. Notwithstanding the above, Residents who do not pay their rents by the fifth (5'') day of the month shall receive a Three (3) Day Notice to Pay or Quit. Such notice shall be in accordance with the California Code of Civil Procedures. If the Notice is not complied with and management is unable to work out a suitable rent payment program with the Resident, an Unlawful detainer action may be filed (with 06-4W4"9 19 Owner's approval) and the matter may be referred to a professional eviction service or attorney specializing in this area of the law. Once such procedures are initiated, the eviction process should take between 45 and 60 days. iii. If the rent is paid in full during the eviction process, the resident's tenancy will not necessarily be reinstated and eviction procedures may be carried out to completion. b. Cases involving a violation of the Residential Lease or House Rules, as contained in the Emerald Cove Resident Handbook, shall be handled as follows: i. Management will keep Residents advised, through newsletters, reminders or written warning notices, of policies in place at the Emerald Cove Apartments. Management will work with Residents and enlist the support of service agencies as required to .prevent recurrent violations. Thirty (30) day notice of intent to terminate tenancy will take place as a last resort and only after approval from the Owner. ii. Residents shall receive written notice of minor infractions of the Lease and House Rules. The initial notice shall advise Residents that such infractions are violations of the Lease and/or House Rules and that upon issuance of the third warning notice for the same violation, management will issue a 30-day notice of Intent to Terminate Tenancy. ob-aW 49 20 Any notice of termination or eviction shall contain a statement of the facts constituting the cause for the termination or eviction and a statement of the Resident's rights under the grievance and appeal procedures. 2) Processing Tenant Complaints. The Manager's Regional Manager is responsible to understand the terms/conditions of the lease and take the following steps. a. Timely and appropriate action to address the problem. b. Document all violations notifying the Resident in writing. c. Follow up promptly as needed to resolve the problem. 3) Residents in violation of the lease or house rules will be subject to the eviction procedures as described above and in the Management Agreement. 4) Appeals and Grievances. All appeals and grievances will be handled in accordance will Emerald Cove Apartment appeal procedures contained herein. H. Social Services / Resident Participation As a senior property, Emerald Cove Apartments will provide Residents with a rich and social environment. Resident -management relations shall be based on a policy of cooperation and communication. Residents shall be encouraged to understand that their involvement with Emerald Cove Apartments, and therefore their ideas, priorities, suggestions and concerns, are both sought and valued. 1) Residents will be provided copies of the Emerald Cove Resident Handbook and other materials pertaining to policies governing their occupancy at the Emerald Cove Apartments. 0& 4-W"49 21 2) Management staff will also provide the Residents with a list of emergency numbers for hospitals, ambulance, fire department and police department, as well as the phone number of the on -site office and back-up information in the event of emergencies when the office is closed. Residents will also receive information about energy conservation and what each Resident can do to reduce energy waste. 3) Emergency Preparedness: All persons will be familiarized with building evacuation procedures, use of smoke alarms, and fire extinguishers. A Residents' meeting will be held with Fire Department and Police Department representatives where practical. • A sign with the John Stewart Company 24 hour emergency number will be prominently posted at the property. III. MAINTENANCE / SECURITY A. The On -Going Maintenance Program shall include the following: 1) Scheduled preventative maintenance and repair of installed equipment in accordance with manufacturer's recommendations and the requirements of equipment operating manual. Skilled maintenance contractors will perform this work. 2) Routine repairs to kitchen appliances, electrical, plumbing, and heating equipment. On - site staff -or independent contractors will perform this work. 3) Preventative annual apartment inspections to regularly and consistently ascertain the condition of each unit. Maintenance problems discovered during these inspections shall be handled according to the work order procedures. 4) Preventative regular inspections and inspections of common areas and equipment, as well as regular schedules (daily, weekly, monthly, quarterly, annually) for maintaining same. Maintenance of exterior and common areas shall include keeping ground free of litter, 0643W4a9 22 trash and paper. Parking areas will be maintained in good repair and free from dirt and litter, to be maintained by the Resident manager. 5) Garbage removal will be provided by the local collection services. The trash areas will be swept daily and scrubbed with disinfectant when necessary. 6) Pest control/extermination services will be contracted for, so as to provide a high level of sanitation and cleanliness. 7) The maintenance of the grounds shall be on a contract basis with a landscape firm or grounds maintenance personnel. B. Preventive Maintenance Schedule Interior painting and redecoration of individual units shall occur based on need substantiated by the annual physical inspection, or as occupancy changes, or as the Manager and Owner may otherwise deem necessary. C. All items needing repair or replacement, whether reported by the Residents or discovered by management staff, shall be recorded by the manager on a maintenance work order form. 1) The form shall be completed in triplicate; one copy each shall be given to the Resident and service provider, and one copy shall be retained in a suitable ledger for follow-up as the work proceeds. 2) The work order form shall indicate the costs of labor and materials and the Resident Manager shall determine any charges to Residents for damages beyond normal wear and tear. Residents will be billed promptly for damages they cause, and, per the lease agreement, be required to reimburse the Project within 30 days or other reasonable time agreed upon by the Manager and Resident. 0"34l4449 23 3) Once the work is completed and the Resident has acknowledged this by signing a copy of the work order, the ledger copy shall be placed in the permanent file assigned to the Resident's unit. 4) All receipts and invoices for which the Manager requests reimbursement shall reference the work order number that originated the work. D. Routine maintenance requests will be completed within ,72 hours. All emergency repairs or replacements, regardless of the time of day they occur, shall be handled promptly. Emergency needs shall be defined as those situations posing immediate threat to the health and safety of Residents and/or the integrity of the grounds, buildings, and equipment, including: the interruption of services, hot or cold running water, electrical, gas, adequate heart and plumbing; glass breakage which deprives Residents of security or heat; or repairs that if not performed would expose Residents to injury. Graffiti shall be removed within 24 hours. In case of an emergency after business hours, a 24-hour answering service. will be maintained to notify the John Stewart Company. E. Major interior redecorating of common areas, exterior painting and projected replacements to building infrastructure, heating and ventilation systems shall be integrated into a capital improvements schedule which shall serve as a basis for computing and establishing the annual operating budget. This schedule shall project the anticipated useful life and replacement costs for such major items. 06-43V4 a9 24 Fiscal Impact Statement ATTACHMENT 3 CITY OF HUNTINGTON BEACH INTERDEPARTMENTAL COMMUNICATION TO: PENELOPE CULBRETH GRAFT, DPA, CITY ADMINISTRATOR FROM: DAN T.VIL LELLA, CPA, FINANCE OFFICER SUBJECT: FIS 2005-06 —31 APPROVE MANAGEMENT CONTRACT FOR EMERALD COVE SENIOR APARTMENT COMPLEX DATE: AUGUST 23, 2006 As required by Resolution 4832, this Fiscal Impact Statement has been prepared for "Approve Management Contract for Emerald Cove Senior Apartment Complex." If the City Council approves this action, an amount of $88,920 will be designated at September 30, 2006 to cover additional costs in the requested City budget for Emerald Cove for 2006-07. This will reduce the unrestricted Emerald Cove Fund Balance at September 30, 2006 to $1,775,000. Dan Villella., Finance Officer Client#: 10464 JOHNSTE ACORD- CERTIFICATE OF LIABILITY INSURANCE 08122,�D/YYYY, PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION Hilb Rogal 8r Hobbs 7250 Redwood Blvd, Suite 300 ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. P.O. Box 6132 Novato, CA 94948-6132 INSURERS AFFORDING COVERAGE NAIC # INSURED John Stewart Company, Inc. 1388 Sutter Street, 11th Floor San Francisco, CA 94109-5427 INSURER A: Fireman's Fund Insurance Company 21873 INSURER B: Republic Indemnity Company of Americ 22179 INSURER c: Hartford Insurance Group 29424 INSURER D: Safeco Insurance Company of America 24740 INSURER E: COVERAGES THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. AGGREGATE LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. INSR LTR ADD'L NSR TYPE OF INSURANCE POLICY NUMBER POLICY EFFECTIVE DATE MM/DD/YY POLICY EXPIRATION DATE MWDD/YY LIMITS A GENERAL LIABILITY MZX80848055 10/01/05 10/01/06 EACH OCCURRENCE $1,000,000 X COMMERCIAL GENERAL LIABILITY MADE � OCCUR DDAMIAGE TO RENTED PRECLAIMS $1,000,000 MED EXP (Any one person) $10 000 PERSONAL &ADV INJURY $1,000,000 GENERAL AGGREGATE $2 000 000 GEN'L AGGREGATE LIMIT APPLIES PER: PRODUCTS - COMP/OP AGG s2,000,000 POLICY PRO LOC JECT D AUTOMOBILE X LIABILITY ANY AUTO 01CG3931213 10/01/05 10/01/06 COMBINED SINGLE LIMIT (Ea accident) $1,000,000 BODILY INJURY person) $ ALL OWNED AUTOS SCHEDULED AUTOS /II7"1 O V ED J o oD11 d 1�.1Y1 X INJURY (Per accident) $ HIRED AUTOS NON -OWNED AUTOS eA0[ IFER McG A��BODILY TH, City A ®(Per me r X PROPERTY DAMAGE (Per accident) $ GARAGE LIABILITY AUTO ONLY - EA ACCIDENT $ OTHER THAN EA ACC $ 1 ANY AUTO H $ AUTO ONLY: AGG A EXCESS/UMBRELLA LIABILITY XA000087241774 10/01/05 10/01/06 EACH OCCURRENCE $5000000 OCCUR CLAIMS MADE AGGREGATE $5 000 000 $ DEDUCTIBLE $ X RETENTION $ 0 B WORKERS COMPENSATION AND 269615 01/01/06 01/01/07 X WCSTATU- OTH- EMPLOYERS'LIABILITY ANY PROPRIETOR/PARTNER/EXECUTIVE E.LEACHACCIDENT $1,000,000 E.L. DISEASE - EA EMPLOYEE $1,000,000 OFFICER/MEMBER EXCLUDED? Ryes, describe under SPECIAL PROVISIONS below E.L. DISEASE - POLICY LIMIT $1,000,000 C OTHER Crime 57BDDA17796 01/01/06 01/01/07 $5,500,000 $25,000 Deducible DESCRIPTION OF OPERATIONS / LOCATIONS I VEHICLES / EXCLUSIONS ADDED BY ENDORSEMENT / SPECIAL PROVISIONS City of Huntington Beach, its agents, officers and employees are named additional insured as respects general liability as per written contract. Waiver of subrogation applies for Workers Compensation. City of Huntington Beach 2000 Main St. Huntington Beach, CA 92648 SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, THE ISSUING INSURER WILL XKg0MjtXjt MAIL 'in DAYS WRITTEN TO THE CERTIFICATE HOLDER NAMED TO THE LEFT REPRESENTATIVE /A'_VRU Aa kzVV 1/V6) j of Z ri53b45/3/M3449Ktf LSM V M%,UMI! I.VRYVMAI IUFM Iyoa IMPORTANT If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must be endorsed. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). DISCLAIMER The Certificate of Insurance on the reverse side of this form does not constitute a contract between the issuing insurer(s), authorized representative or producer, and the certificate holder, nor does it affirmatively or negatively amend, extend or alter the coverage afforded by the policies listed thereon. ACORD 25-S (2001/08) 2 of 2 #S364573/M344188 POLICY NUMBER: MZX80848055 COMMERCIAL GENERAL LIABILITY THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. ADDITIONAL INSURED - DESIGNATED PERSON or ORGANIZATION This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART SCHEDULE Name of Person or Organization: City of Huntington Beach 2000 Main St. Huntington Beach, CA 92648 (If no entry apppears above, information required to complete this endorsement will be shown in the Declarations as applicable to this endorsement.) WHO IS AN INSURED (Section II) is amended to include as an insured the person or organization shown in the Schedule, but only with respect to liability arising out of your operations or premises owned by or rented to you. City of Huntington Beach, its agents, officers and employees are named additional insured as respects general liability as per written contract. CG 20 26 11 85 RCA ROUTING SHEET INITIATING DEPARTMENT: Economic Development Department SUBJECT: Approve Management Contract for Emerald Cove COUNCIL MEETING DATE: October 2, 2006 RCA ATTACHMENTS STATUS Ordinance (w/exhibits & legislative draft if applicable) Attached Not A plicable Resolution (w/exhibits & legislative draft if applicable) Attached Not Applicable Tract Map, Location Map and/or other Exhibits Attached Not Applicable Contract/Agreement (w/exhibits if applicable) Attached (Signed in full by the City Attorney) Not Applicable ❑ Subleases, Third Party Agreements, etc. Attached 171 (Approved as to form by City Attorney) Not Applicable Certificates of Insurance (Approved by the City Attorney) Attached Not Applicable ❑ Fiscal Impact Statement (Unbudgeted, over $5,000) Attached Not A plicable ❑ Bonds (If applicable) Attached 11 Not Applicable Staff Report (If applicable) Attached Not Applicable Commission, Board or Committee Report (If applicable) Attached Not Applicable Findings/Conditions for Approval and/or Denial Attached Not Applicable EXPLANATION FOR MISSING ATTACHMENTS REVIEWED RETURNED FORWARDED Administrative Staff ( ) ( ) Assistant City Administrator Initial ( J City Administrator Initial City Clerk EXPLANATION•- RETURN OF (Below Space For City Clerk's Use Only) RCA Author: Terri King x8831 CITY OF HUNTINGTON BEACH 2000 MAIN STREET OFFICE OF THE CITY CLERK JOAN L. FLYNN CITY CLERK October 9, 2006 The John Stewart Company, Inc. 624 South Grand Avenue, Suite 2500 Los Angeles, CA 90017-3326 Attn: Lori Horn, Vice President Dear Ms. Horn: CALIFORNIA 92648 Enclosed is a fully executed copy of the Management Agreement Between the City of Huntington Beach and John Stewart Company, Inc. for the Management of Emerald Cove Senior Housing Complex. Sincerely, j" %'-1494() 7L. Flynn City Clerk JF:pe Enclosure: Agreement G:fo1Iowup:agrmt1tr (Telephone: 714536-5227 )