HomeMy WebLinkAbout2004-08-02 City Council (4)City of Palo Alto
C ty Manager’s Report
TO:HONORABLE CITY COUNCIL ~ ¯
FROM:CITY. MANAGER DEPARTMENT: PLANNING &
COMMUNITY ENVIRONMENT
DATE:AUGUST 2, 2004 CMR: 369:04
SUBJECT: APPROVAL OF CONTRACT WITH KEYSER MARSTON
ASSOCIATES, INC. IN THE AMOUNT OF $137,085 FOR ANALYSES TO
SUPPORT THE CITY OF PALO ALTO’S BELOW MARKET RATE (BMR)
HOUSING PROGRAM
RECOMMENDATION
Staff recommends that the City Council approve the attached contract with Keyser
Marston Associates, Inc., in collaboration with Anderson and Associates, in the amount
of $137,085 for analyses to update the City of Palo Alto’s Below Market Rate Housing
Program; and authorize the Mayor to execute the contract.
BACKGROUND
The City founded its Below Market Rate (BMR) Housing Program in 1974, making it
one of the first established in the U.S. Over the past 30 years, the City and Palo Alto
Housing Corporation (PAHC), a private non-profit corporation under contract to the City
as the program administrator, have acquired significant expertise in developing,
marketing, selling, maintaining and reselling BMR units, as well as enforcing deed
restrictions relating to occupancy, rental and transfers.
Over time, however, various administrative issues have arisen regarding implementation
of the program due, to a large degree, to the unforeseen escalating values in the Palo Alto
housing market resulting in unanticipated long-term ownership of many of the BMR
units. Deed restrictions and appreciation formulae of the BMR Program vary with
individual projects and should be re-evaluated. In addition, Program H-37 of the City’s
recently adopted 2002 Housing Element, which calls for adoption of an ordinance
codifying the BMR Program, needs to be implemented. In adopting the 2002 Housing
Element, the Council gave general direction for an overall re-evaluation and update of the
BMR Program.
CMR: 369:04 1 of 5
Staff, working closely with PAHC, developed a work. program for the update process.
The intent of the update is to evaluate opportunities for improving the program that will
further the City’s goal of producing and retaining affordable housing, in addition to
dealing with the aforementioned administrative issues. The update analysis would
provide data for the City Council to assess the future direction of the program with a
focus on increasing effectiveness and efficiency in the BMR Program.
After outlining tasks and identifying principal work products and the type of expertise
needed, staff evaluated cost-effective ways to supplement the limited staff time and
resources that could be dedicated to the update effort. A contract planner was hired in
July 2003 to manage the overall update process. In early June 2004 a graduate student
was hired for research tasks and database preparation to supplement the consultant and
contract planner work.
DISCUSSION
Scope of Services Description
The scope of work to be performed under the proposed contract is for a range of analyses
to support the BMR Program. Please see Attachment B for the complete scope of
services. Major tasks in the scope include:
[]Background, Housing Inventory and Related Analyses: Comment on inventory
database and owner survey instrument
[]BMR Unit Value and Maintenance: Examine initial sales prices of new units,
appreciation schedule, maintenance and treatment of capital improvements, special
assessments
[]Deed Restrictions: review impact of deed restrictions On buyer financing,
enforcement of program requirements and implementation of new deed
restrictions
[]Administrative Procedures Manual: examine waiting list administration and
resale .process and procedures
[] Program hnplementation Policy Analysis: evaluate in-lieu fee formula, increasing
supply of BMR units, program’s history vs. current needs, qualitative and
quantitative policy analysis of economic costs and benefits of program and rental
vs. ownership
[] Public Meetings: study session with Planning and Transportation Commission
(PTC) and City Council and punic hearings with both Council and PTC on the
draft recommendations
The update process will involve participation by both City staff as well as the consultant
team to complete the overall effort. In conjunction with the consultant contract, the
City’s contract planner will prepare a revised BMR Procedures and Policies Manual for
administrative use and a BMR owner handbook as well as update the BMR inventory
CMR: 369:04 2 of 5
database of housing stock. The City Attorney’s Office will prepare the BMR Ordinance
and new legal documents for enforcement of the revised deed restrictions. City staff will
be working in full partnership with PAHC in the update process. Attached is a summary
of the principal work products and responsibilities for completion of the update
(Attachment C).
Summary of Solicitation Process
Proposal Description!Number
Proposed Length of Project
Number of Proposa!s Mailed
Total Days to Respond to
Proposal
Pre-proposal Meeting Date
Number of Proposals Received:
Company Name
Analyses to Support the city of Palo Alto’s Below
Market Rate (BMR) Housing Program/105048
Selected for
interview?
No interviews held
12 months~
9
28
None
2
Location (City, State)
1. Keyser Marston Associates,San Francisco, CA
Inc.
2. Vernazza!Wolfe Associates Oakland, CA No interviews held
Range of Proposal Amounts $87,000 to $137,085
Submitted
oral
A Request for Proposals (RFP) to select a consultant team to prepare the bulk of the
analyses for the BMR Program update process was distributed to nine consultants in
February of 2004. Two proposals were received. One proposal was from Keyser
Marston Associates, Inc. (ICMA) for $137,085 and the other was from Vernazza/Wolfe
Associates for $87,000.
An evaluation committee consisting of representatives from the Department of Planning
and Community Environment, the City Attorney’s Office and Palo Alto Housing
Corporation reviewed the proposals. The committee carefully reviewed each firm’s
qualifications and submittal in response to the criteria identified in the RFP including:
completeness of response and evidence of understanding the purpose, objectives and
requirements of the project; composition of the consultant team and project manager and
their direct experience and expertise with administration of inclusionary housing
programs; flexibility and availability to accommodate meetings and public consultation;
experience and skill in public presentations and facilitating meetings; demonstrated
experience and familiarity with legal aspects of real estate/title deed documents; and
contract cost.
CMR: 369:04 3 of 5
The results of the selection committee were unanimous; all members of the selection
committee favored the I~VIA team because it offered the best approach to the analyses
and the team included Anderson and Associates, who had hands-on experience in
developing and implementing below market rate programs. Although the
Vernazza/Wolfe Associates (VWA) proposal was less costly, the committee considered
the IGX4A proposal to be more focused on the relevant issues for the study, primarily the
deed restrictions, the appreciation schedule and maintenance and treatment of capital
improvements in the units. Janet Anderson’s extensive experience in administering as
well as developing below market rate programs was a critical factor in the selection of the
KMA team.
RESOURCE IMPACT
Funds for the update were appropriated from the Residential Housing In-Lieu Fund’s
FY2003-04 budget for contract and consultant services, with unspent funds carried over
to FY04/05. Funding allocated to the update consists of an overall budget of
approximately $205,000 including $137,085 for the consultant contract, $50,000 for the
contractplanner, $8,000 for the intern and $10,000 for contract legal assistance.
POLICY IMPLICATIONS
Preparation of a comprehensive update to the BMR Program is consistent with the overall
goals of the Housing Element of the Comprehensive Plan and specifically with policies
H-36 and H-37 that pertain to the BMR Program.
ENVIRONMENTAL REVIEW
The approval of an agreement for consulting services is statutorily exempt (Section
15262) from the California Environmental Quality Act.
ATTACHMENTS
Attachment A:Contract
Attachment B:Scope of Services
Attachment C:BMR Update Overall Work Program
CMR: 369:04 4 of 5
PREPARED BY:~~O~ Advance Planning Manager
DEPARTMENT HEAD:
STE"nMS£ ,
of Planning and Community Environment
CITY MANAGER APPROVA
EMIL’~FIARRISON
Assistant City Manager
CMR: 369:04 5 of 5
ATTACHMENT A
CONTRACT NO.
EETWU~EN THE CiTY OF PALOALTO ~!qI)
KEYSER I<~[STON ASSOCIATES, INCo
FOR CONSULTING SERVICES
This .Contract No.is entered into ,
by and between the CITY OF PAL0 ALTO, a chartered city and a
municipal corporation of the State of California ("CITY"), and
KEYSER YIRSTON ASSOCIATES, INC. located at 55 Pacific Avenue Mall,
San Francisco, CA 94111 ("CONSULTANT").
RECITALS:
WHEREAS, CITY desires certain professional consulting
services ("Services") and the preparation and delivery of, without
limitation, one or more sets of documents, drawings, maps, plans,
designs, data, calculations, surveys, specifications, schedules or
other writings ("Deliverables") (Services and Deliverables are,
collectively, the "Project"), as more fully described in Ey~ibit
"A"; and
WHEREAS, CITY desires to engage CONSULTANT, including its
employees, if any, in providing the Services by reason of its
qualifications and experience in performing the Services, and
CONSULTANT has offered to complete the Project on the terms and in
the manner set forth herein;
NOW, THEREFORE, in consideration of the covenants, terms,
conditions, and provisions of this Contract, the parties agree:
SECTION i. TERM
i.I This Contract will commence on the date of its
execution by CITY, and will terminate upon the completion of the
Project, unless this Contract is earlier terminated by CITY. Upon
the receipt of CITY’s notice to proceed, CONSULTANT will commence
work on the initial and subsequent Project tasks in accordance with
the time schedule set forth in Exhibit "A". Time is of the essence
of thisContract. In the event that the Project is not completed
within the time required through any fault of CONSULTANT, CITY’s
city manager will have the option of extending the time schedule
for any period of time. This provision will not preclude the
recovery of damages for delay caused by CONSULTanT.
SECTION 2.SCOPE OF PROJECT; CHANGES & CORRECTIONS
2.1 The scope of Services and Deliverables constituting
the Project will be performed, delivered or executed by CONSULT;~T
under the phases of the Basic Services as described below.
2.2 CITY may order substantial changes in the scope or
character of the Basic Services, the De!iverables, or the Project,
040722 syn 8250036
either decreasing or increasing<:.hhe amount of work required of
CONSULTAI~T. In the .e~ent that such changes are ordered, subject to
the approval of CIT¥’~iCity Counci!, as may be required, CONSULTANTwill be entitled to fu!$~ compensation for all work performed prior
to CONSULT_~qT’s receipt of the notice of change and further wil! be
entitled to an extension of the time schedule. Any increase in
compensati0n: .for :. substantial changes wil! be determined in
accom~an~e with the~:provisions of this Contract. CITY will not be
.~,~able fore.the c0s~_,or pa]~ment of any:change in work, unless the
~mount~0[ additiona~, compensation att~ributable to the change in
work is agreed to, inwriting, by CITY before CONSULTANT commences
the performance of any such change in work.
SECT!ON 3. QUALIFICATIONS, STATUS,
CONSULTanT
DUTIES OF
3.1 coNSULTANT represents andwarrants that it has the
eAstertide, land profe~isional qualifications to furnish or cause to be
furnished the Services and Delivera~les. CONSULT’A~T further
represents and warrants that the project director and every
individual, including any consultant (or contractors), charged with
the. performance of the Services are duly lidensed or certified by
the State of.. California,~ to the extent such licensing or
certification~ is required by law to perform the Services, and that
the Project will be executed by t.hemor under their supervision.
COHSULTANT will furnish to CITY for approval, prior to execution of
this Contract, .a list of all individuals and the names of their
empl0yers or principals to be emp!oyed as consultants.
3.2 In reliance on the representations and warranties
set forth in this Cont}act, CITY hires CONSULTANT to .execute, and
CONSULTANT covenants and agrees that it wil! execute or cause to be
executed, the--Project.
3.3 CONSULTANT will assign Debbie M. Kern as the project
director to have supervisor], responsibility for the performance,
progress, and execution of~the Project-. Debbie M. Kern will be
assigned as the projec-t coordinator who will represent CONSULTANT
during the day-to-day.work on the Project. If circumstances or
conditions subsequent to the eiecution of this Contract cause the
substitution of the pro]ect director or project coordinator for any
reason, the appointment of a substitute project director or
substitut@ project coordinator will be subject to the prior written
a~proval of the project manager.
3.4 CONSULTANT represents and warrants that it will:
3.4.1 Procure all permits and licenses, pay all
charges and fees, and give al! notices which may be necessary and
incident to the due and lawfu! prosecution of the Project;
3.4.2
future Federal,
Keep itself-fully informed of all existing and
Sta.t.e of California,_ and local laws, ordinances,
regulations, orders,<,, and decrees which may affect those engaged or
emp!oyed under this Contract and any materials used in CONSULTANT’s
performance of the .Servi~ces;
~3_.4..3 .:i At all times observe and comply with, and cause
its employees’ and ~consultants, if any, who are assigned to the
performance of this_Contract to observe and comply with, the laws,
ord£nanmes, regulmti:0ns, :o.r~ders and.decrees mentioned above; and
3.4.4 " -Wi,ll report immediately to the project manager,
in writing, any discrepancy or inconsistency it discovers in the
laws, ordinances, regulations, orders, and decrees mentioned above
in relation to the Deliverables.
" 3.5 Any Deliverablesgiven to, or prepared or assembled
by, C0NSJLTANT or its consultants, if any, under this Contract will
become the property:-,of CiTY and will not be made available to any
individual or organization by CONSULTANT or its consultants, if
any, without the priQr written approval of the city manager.
3.6 CONSULTANT will provide CITYwith ten (i0) copies of
any documents .which ~re :a part of the Deliverables upon their
completion and acceptance by CITY and one electronic copy in
Microsoft Word 2000..
~ ~ 3.7 if C:~TY requests additional copies of any documents
which are a part of the Deliverables, CONSULTANT will provide such
additional copies and CITY will compensate CONSULTANT for its
duplicating costs.
3.8 _CONSULTANT will be responsible for employing or
engaging al! persons necessary to execute the Projects All
consultants of CONSULT~qT will be deemed to be directly controlled
and supervised by CONSULTANT, which will be responsible for their
performance. If any employee or consultant of CONSULTANT fails or
refuses to carry out the provisions of this Contract or appears to
be incompetent or to.act in a disorderly or improper manner, the
employee or consultant will be._discharged immediately from further
performance under this ~Contract on demand of the project manager.
3.9 In the execution of the Project, CONSULTANT and its
consultants, if any, will at all times be considered independent
contractors and not’agents or employees of CITY.
3.10 CONSULTANT will perform or obtain or cause to be
performed or obtained any and all of the following Additional
Services, not included under the Basic Services, if so authorized,
in writing, by CITY:
3.10.1 Providing services as an expert witness in
connection with any public hearing or meeting, arbitration
proceeding,or proceeding of a court of record;
3.10.2 Performing.any other Additional Services that
may be agreed upon by the parties subsequent to the execution of
this Contract.; and
3.10~3 Other Additional Services
descmibed, in Exhibit ~’!A’! to this Contract.
SECTION 4~<<~DUTIES OF C!TY
now or hereafter
4.1 CITY wi~ll furn’ish or cause to be furnished the
services listed in Exhibit ’~A’~ and such information regarding its
requirements applicable to the Project as may be reasonably
requested by_CONSULTANT.
4.2 ClT~-will review and approve, as necessary, in a
~±me{ly manner the De.liverables and each phase of work performed by
~0NSULT~T. CITY~’s estimated time of review and approval wil! be
furnished to CONSULTanT at the time of submission ~of each phase of
work. CONSULTANT acknowledges and understands that the interrelated
exchange of information among CITY’s various departments makes it
extremely difficult for CiTY to firmly establish the time ofeach
review and ~appr@vai task. CITY’s failure to review and approve
within the estimated time schedule will not constitute a default
mnder ~this Contract.
4.3 The city manager will represent CITY for all
purposes under this Contract. Chief Planning Officer is designated
as the project manager for the:city manager. The project manager
will supervise the performance, progress, and execution of the
Project, and will be assisted by the Advance Planning Manager.
~.4 If CITY observes or otherwise becomes aware of any
default-.in the per~ermance of CONSULTANT, CITY will use reasonable
efforts to give wri:i%ten notice t~ereo~f to CONSULTANT in a timely
SECTION 5.COHPENSATiON
5.1 .CITY will compensate CONSULTANT for the following
services and work:
5.1.1 In consideration of the full performance of the
Basic Services, including any..amShorized r~imbursable expenses,
CITY will pay CONSULTANT a fee not to exceed One Hundred Thirteen
Thousand Three Hundred Five Dollars ($103,875). The amount of
compensation will be calculated in accordance with the hourly rate
schedule set forth in Exhibit "B", on a time and materials basis,
up to the maximum amount set forth in this Section. Consultant
agrees to perform all services set forth in Exhibit B within the
not to exceed amount of this contract. The fees of the
consultants, who have direct contractual relationships with
GONSULT~qT, will be .approved, in advance., by CITY. CITY reserves
4
the right to refuse payment of such fees, if such prior approval is
not obtained by CONSULTANT.
5.1.2 Inconsideration of the full performance of
Additional Services~ ~:the amount :of compensation set forth in
Exhibit<’!9" will nat exceed Thir~ty:Three ~Thousand Two Hundred Ten
Dollars ($33,210).
5.1.3 The ful! payment of charges for extra work or
changes, or both, in the execution of the Project will be made,
provided such_request for payment is initiated by CONSULTANT and
authorized~ in wri:ting, by the project manager. Payment will be
made :.within thirty (30) days of submission by CONSULTANT of a
statement, in triplicate, of itemized costs covering such work or
changes, or both. _rPrior to commencing such extra work or changes,
or both, the parties will agree in writing upon an estimated
maximum cost for such extra work or changes. CONSULTanT wil! not
be paid for extra work or changes, including, without limitation,
any design work or change order preparation, which is made
necessary on account of CONSULTAATT’s errors, omissions, or
oversights~
5.1.4 _.~.Direct personnel expense of employees assigned
tothe .execution ol the Project by CONSULTANT will include only
consultants and administrative support staff. Included in the cost
of direct personnel expense of these employees are salaries and
mandatory and customary benefits such as statutory employee
benefits, insurance, sick leave, holidays and vacations, pensions
and similar benefits.
5.2 The schedule of payments will be made as fol!ows:
5.2.1 . :Pa]~ent of the Basi.c Services will be made in
monthly progress payments.in proportion to the quantum of services
performed, or in accordance with any other schedule of .payment
mutually agreed upon by the parties, as set forth in Exhibit "B", or
within thirty (30) days of submission, in triplicate, of such
requests if a schedule of payment is not specified. Fina! payment
will be made by CITY aft~er CONSULTANT has submitted all
Deliverables, including, without limitation, reports which have
been approved by the project manager.
5.2.2 Payment of the Additional Services will be made
in monthly progress payments for services rendered, within thirty
(30) days of submission, in triplicate, of such requests.
5.2.3 No deductions will be made from CONSULTANT’s
compensation on account of penalties, liquidated damages, or other
sums withheld by CITY from payments to genera! contractors.
5
040722 svn 8250036
SECTION.@. ACC0~\~T!NG, AUDITS, OWNERSHIP OF RECORDS
6.1 Records of~ the _direct. personnel expenses and
expensesincurred .in connection with the performance of Basic
Services and Additional Services pertaining to the Project will be
prepared, maintained, and retained by CONSULT~IgT in accordance with
generally accepted accounting principles and will be made available
to CITY for auditing, purposes at mutually convenient times during
the term of ~!thi~s Contract and for three (3) years following the
expiration or earlier termination of this Contract.
:,~.~.:<~ . , _6.2 The originals of .the Deliverables prepared by or
under the direction<of CONSULTANT :in the performance of this
Contract will become ~the property of CITY irrespective of whether
the Project is completed upon CITY’s payment of the amounts
required to be paid to CONSULTANT. These originals will be
delivered to CITY without additional compensation. CITY will have
the right to,utilize any final and incomplete drawings, estimates,
specifications, and any other documents prepared hereunder by
CONSULTANT, but CONSULTANT disclaims any responsibility or
liability for any alterations or modifications of such documents.
SECTION 7. iNDEHN!TY
7.1 CONSULTANT agrees to protect, indemnify, defend and
hold harmless CITY, its Council members, officers, employees and
agents, from any and al! demands, claims, or liability of any
nature .... inqluding death or injury to any person, property damage or
any other loss, caused by or arising out of CONSULTANT’s, its
officers’, agents’,k-consultants’ or employees’ negligent acts,
errors, or omissions, or willful misconduct, or conduct for which
applicable law may impose strict liability on CONSULTANT in the
performance of or failure to. perform its obligations under this
Contract.
SECTION 8.WAIVERS
8.1 The waiver by either party of any breach or
Violation of any~covenant, term, ~ondition or provision of this
~ontract or of the-provisions of any ordinance or law will not be
deemed to be a waiver of any such covenant, term, condition,
provision, ordinance,_ or law or of any subsequent breach or
violation of the same or of any other covenant, term, condition,
provision, ordinance or law. The subsequent acceptance by either
party of any fee or other money which may become due hereunder wil!
not be deemed to be a waiver of any preceding breach or violation
by .the .other party of any covenant, term, condition or provision of
this Contract or of any app!icable law or ordinance.
8.2 No pa]~ent, partia! payment, acceptance, or partial
acceptance by CITY will operate as a waiver on the part of CITY of
any of its rights under this Contract.
SECTION 9.INSUKhNCE
9.1 CONSUETANT, ~t its’ sole cost and expense, will
obtain and maintain_i in fullforce and effect during the term of
this Contract, the insurance:c~overage described in Exhibit "C",
insuring not only CONSULTanT and its consultants, if any, but also,
with the exception,mf workers’ compensation, employer’s liability
and professional.liability insurance, naming CITY as~ an .additional
insured:<cen~erning. CONSULTANT~s performance under this Contract.
9.2 All insurance coverage required hereunder wil! be
provided through carmiers with Best’s Key Rating Guide ratings of
A:VII or higher whi:ch .are admitted to transact insurance business
in the State of California. Any and all consultants of CONSULT}2qT
retained to perform Services under this Contract will obtain and
maintain, in ful! force and effect during the term of this
Contract, identica! insurance coverage, naming CITY as an
additiona! insured undersuch policies as re~ired above.
~_~Y~,’<.’ . i. 9.3 Cert.ificat.es of_.such insurance, preferably on the
forms provided by CITY, will be filed with CITY concurrently with
the execution of this Contract. The certificates will be subject
to the approval of CI.TY’s risk manager and will contain an
endorsement stating that tie insurance is primary coverage and will
not be canceled, or altered by the insurer except after filing with
the CITY’s .city clerk thirty .(30) days’ prior written notice of
such canc~llation or alteration, and that the City of Pa!o Alto is
named as an additional insured except in policies of workers’
compensa:tion, employer’s liability,._ and professiona! liability
insurance. Current certificates of such insurance will be kept on
file at all times during the term of this Contract with the city
clerk.
9.4 The procuring of such required policy or policies
of insurance will not be construed to limit CONSULTANT’s liability
hereunder nor to fulfill the indemnification provisions of this
Contract. Notwithstanding the policy or policies of insurance,
CONSULTANT will be <obligated for the fmll and total amount of any
damage, injury, orloss caused by or directly arising as a result
of the Services performed under this Contract, including, such
damage, injury, or loss arisi~g: after the Contract is terminated or
the term has expired..
SECTION i0.WORKERS’ COMPENSATION
i0.i CONSULTANT, by executing this Contract, certifies
hhat it is aware of the provisions of the Labor Code of the State
of California which mequire every employer to be insured against
liability for workers’ compensation or to undertake self-insurance
in accordance with the provisions of that Code, and certifies that
it will comply with such provisions, as applicable, before
commencing the performance of the Project.
7
040722 svn 8250036
SECTION ~ii. TEP~iNATION OR SUSPENSION OF CONTP~CT OR
PROJECT
ii.i The city manager may suspend the execution of the
Project, in whole or~in part, or terminate this Contract, with or
without cause, by ~giving thirty (30) days~ prior written notice
thereof to CONSULTANT, or immediately after submission to CITY by
C0NSULTAI~T of any:._c:ompleted item of Basic Services. Upon receipt
of:::.~such-~:notice, CONSULTANT wil! immediately discontinue its
performance under this Contract.
11.2 CONSULTANT may terminate this Contract or suspend
its execution of the ~Project ~by giving thirty (30) days’ prior
written notice thereof to CITY, but only in the event of a
substantial failure of performance by CITY or in the ~event CITY
indef±nitely.wi!thholds or withdraws its request for the initiation
or continuation .of Basic Services or the execution of the Project.
ii.3 Upon such suspension or termination by CITY,
CONSULTANT will be:compensated for the Basic Services and
Additiona! Services performed and De!iverables received and
approved prior to receipt of written notice from CITY of .such
suspension or abandonment, together with authorized additional and
reimbursable e~-’penses then due. If the Project is resumed &fret it
has been. suspended for more than 180 days, any change in
CONSULTANT’s compensation will be subject to renegotiation and, if
necessary, approvai~_ of CITY’s City_Comncil. If this Contract is
suspended or termin~t,ed on ~ccount of a_default by CONSULTANT, CITY
will be obligated to.compensate CONSULTANT only for that portion of
C0NSULTAI\VT’s services.~which are of direct and immediate benefit to
CITY, as such determination may be made by the city manager in [he
reasonable exercise of her discretion.
11.4 !n the event of termination of this Contract or
susp÷nsion of work~on the Project by CITY where CONSULTANT is not
default, CONSULTANT wil! receive compensation as follows:
11.4.1 E0r approved items of services, CONSULTANT wil!
be compensated for each item of Service fully performed in the
amounts authorized under this Contract.
!1.4...2 For approved items of services on which a
notice to proceed is issued by CITY, but which are not fully
performed, CONSULTANT will be compensated for each item of service
in an amount which ~ears the same ratio to the total fee otherwise
payable for the p_erformance ~f the service as the quantum of
service actually rendered bears ~o the services necessary for the
full performance of that item of service.
11.4 3 The total compensation payable under the
~h_s Section will not exceed the paymentpreceding paragraphs of ~ ~
specified under Section 5 for the respective items of service to be
furnished by CONSULTANT.
11.5 Upon such suspension or termination, CONSULT_ANT
will deliver to the mity.manager immediately any and all copies of
the Deliverables, whether or not completed, prepared by CONSULTANT
or its ~onsultants, if any, or given to CONSULTANT or its
consu!tants, if ar~y, in connection with this Contract. Such
materLals~..will become the property_of CITY.
ii. 6 The i~ilure of CITY to agree with CONSULT}~Tr s
independent findings, conclusions, or recommendations, if the same
are called for under.this Contract, on the basis of differences in
matters of judgment} :will not be construed as a failure on .the part
of CONSULTANT to ::fulfil! its obligations under this Contract.
SECTION !2.~ ASSIGNMENT
12.1 This Contract is for the persona! services of
CONSULTanT, therefore, CONSULTANT wil! not assign, transfer,
convey, or otherwise dispose of this Contract or any right, title
or interest in or to the.same or any part thereof without the prior
written consent of CITY. A consent to one assignment will not be
deemed to _be a consent to any subsequent assignment. Any
assignmenit made wi-thout the approva! of CITY wil! be void and,. at
the option of thecity manager, this Contract may be terminated.
This Contract will~.~ot be ~assignable._by..operation of law.
SECTION 13~._ NOTICES
13.1 All notices hereunder will be given, in writing,
and mailed, postage prepai.d, by certified mail, addressed as
follows:
To CITY:Office of the City Clerk
,City of Palo Alto
.~,Bost Office Box 10250
Palo Alto, CA 94303
To CONSULTANT: Attention of the project director
at the address of CONSULTanT recited above
SECTION 14.CONFLICT OF INTEREST
14.1 !n accepting this Contract, CONSULTANT covenants
:hat it presently has no interest, and will not acquire any
interest, direct or in-direct, financial or otherwise, which would
conflict in any manner or degree with the performance of the
Services.
14.2 CONSULTanT further covenants that, in the
performance of this Contract, it will not employ contractors or
persons having such an interest mentioned above. CONSULTANT
9
certifies that no on~:,~who has or will have any financial interest
under this Contract:~!is an officer or emp!oyee of CITY; this
provision will be interpreted in accordance with the applicable
provisions of the .Pal~.Alto Municipal Code and the Government Code
of the State of California.
~ SECTiON!I:5. NONDISCRIMINATION
15.1 As .s~et forth in the Palo Alto Municipal Code, no
discrimination will be made in the employment of persons under this
Contract because of the ag.e, race, color, national origin,
ancestry, religion, disability, sexual preference or gender of such
person. If the~alue o.f this Contract is, or may be, five thousand
dollars ~($5./00,0~ or more, CONSULTanT agrees to meet all
requiremenfis of /t~e P.alo Alto Municipal Code pertaining to
nondiscrimination in employment, including completing the requisite
form furnished by CITY and set forth in Exhibit "D".
15.2 CONSUL~ANT agrees that each contract for services
from independent providers will contain a provision substantially
as follows: ~
’!:[Name of Provider] will provide CONSULTANT
With a mertificate stating that [Name of
Provider].is currently in compliance with al!
.:Federa! and State of California. laws covering
nondiscgim&nation in employment; and that
[Name of Provider] will not discriminate in
the employment of any person under this
contract becaus6 of the age, race, color,
national origin, ancestry, religion,
disability, sexua! preference or gender of
such person.."
15.3 If GONSULT~9 i.s ~ :i~mmnd in violation of the
nondiscrimination provisions of the State of California Fair
Employment Practices:Act or .similar provisions of Federal law or
executive order in theperformance of this Contract, it wil! be in
default of this Contract. Thereupon, CITY wil! have the power to
cancel or suspend this Contract, in whole or in part, or to deduct
the sum of twenty-five dollars ($25) for each person for each
calendar day during which such person was subjected to
discrimination, as damages for breach of contract, or both. Only a
finding of the State of California Fair Employment Practices
Commission or the: equivalent federal agency or officer wi!I
constitute evidence of a breach of this Contract.
SECTION 16.~MISCELLANEOUS PROVISIONS
16.1 CONSULTANT represents and warrants that it has
knowledge of the requirements of the federal Americans with
Disabilities Act of 199@, and the Government Code and the Health
and.Safety Code of<the Sta~te of sa±~ro, nza, relating to access ~
i0
public buildings and accommodations for disabled persons, and
relating to facilitie-s for disabled persons~ CONSULTAI~T will
comply with or ensure by its advice that compliance with such
provisions will,be ~effected pursuant to the terms of~this Contract.
16.2 Upon the agreement of the parties, any controversy
or claim arisin~ o~t~._of or ~rel~tin~ tolthis Contract may be settled
by arbitration in accordance with the Rules of the American
Arbitration Association, and judgment upon the award rendered by
the Arbitrators may be e~tered in any court having jurisdiction
thereof.
16.3 This Contract will be governed by the laws of the
State of California, excluding its conflicts of law.
~:. ~ ~16.4 In ~he event that ~an .action is brought, the parties
igree that trial of_such action will be vested exclusively in the
state courts of California or in the United States District Court
for the Northern District of .California in the County of Santa
Clara, State of California.
16.5 The prevailing party in any action brought to
enforce the terms o£ this Contract or arising out of this Contract
may recover its reasonable costs and attorneys’ fees expended in
connection with that action.
16.6 This. document represents the entire and integrated
Contract between the parties and supersedes al! prior negotiations,
representations, and contracts, either written or ora!. This
document may he amended only by a written instrument, which is
signed by the parties.
16.7 All provisions of this Contract, whether covenants
or conditions, will be deemed to be both covenants and conditions.
16.8 The~covenants, terms, conditions and provisions of
this Contract will apply to, and wil! bind, the heirs, successors]
executors, administrators, assignees, and consultants, as the case
may be, of the parties.
16.9 If a court of com_metent jurisdiction finds or rules
that: any provision..of this Contract or any amendment thereto is
void or unenforceable, the unaffectedprovisions of this Contract
and any amendments thereto wil! remain in full force and effect.
16.10 All exhibits referred to in this Contract and any
addenda, appendices, attachments, and schedules which, from time
to time, ma~ be referred to in any duly executed amendment hereto
are by such reference incorporated in this Contract and will be
deemed to be a part of this Contract.
16.11 This Contract may be executed in any number of
counterparts,each of which will be an original, but all of which
together~will,constbtute one and the same instrument.
16.12 This Contract is subject to the fiscal provisions
of the Charter of the,City .of Pa£o Altoand the Palo Alto Municipal
Code. This Contract ~wi!l terminate without any penalty (a) at the
end of any fiscal yearin the event that funds are not appropriated
for the following fisca! ~ear,. or (b) at any time within a fiscal
year in the event that funds are only appropriated for a portion of
the fisca! year and funds for this Contract are no longer
available. This Section 16.12 will take precedence in the event of
a conflict with any other covenant, term, condition, or provision
~f this. Contract. .
IN WiTNESS}.~EREOF, the parties hereto have by their duly
authorized representatives executed this contract on the date first
above written.
APPROVED AS TO FORM:CITY OF PALO ALTO
:-:~Senior Asst. City Attorney
APPROVED :
Director of Planning and
Community.Environment
Director of Administrative
Services .~
insurance Review
Assistant City Manager
KEYSER KLARSTON ASSOCIATES,
INC.
By:
Name:
Title:
By.:
Name:
Title:
Taxpayer I.D. No.
(Compliance with Corp. Code § 313 is
requir.ed if the entity on whose behalf
this contract is signed is a corporation.
In the alternative, a certified corporate
resolution attesting to the signatory
authority of the individuals signing in
their respective capacities is
acceptable) .
Attachments:EXHIBIT "A" :
EXHIBIT "B" :
EXHIBIT "C" ¯
EXHIBIT "D" :
SCOPE OF PROJECT &TIME SCHEDULE
RATE SCHEDULE
INSURANCE
NONDISCRIMINATION COHPLIANCE FORM
12
STATE OF
COUNTY OF
¯ CERTIFICATE OF ACI41~OWLEDGMENT
(Civil Code § i189)
)
On , 2004, before me, the undersigned, a
Notagy Public in and for said County and State, personally appeared
, personally known to
me or proved to me on the basis of satisfactory evidence to be the
person(s) whose name(s) is/are subscribed to the within instrument
and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their
signature s) on the instrument the person(s), or the entity upon
behalf of which the person.(s) acted, executed the instrument.
WITNESS my hand and official sea!.
Signature of Notary Public
13
CERTIFICATE OF ACIqNOWLEDGMENT
(Civil Code § 1189)
STATE OF
COUNTY OF )
On , 2004, beforeme, the undersigned, a
Notary Public in and for said County and State, personally appeared
, personally ]Known to
me or proved to me on the basis of satisfactory evidence to be the
person(s) whose name(s) is/are subscribed to the within instrument
and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ieS), and that by his/her/their
signature s) on the instrument the person(s), or the entity upon
behalf of which the person(s) acted, executed the instr-~ment.
WITNESS my hand and official seal.
Signature of Notary Public
14
ATTACHMENT B
Exhibit A: Scope of Services
KEYSER MARSTON ASSOCIATES, INC.
Below Market Rate Housing Study - City of Palo Alto
The following highlights the specific approach that Keyser Marston (KMA) and Anderson
Associates (AA) will take in undertaldng the Below Market Rate (BMR) Housing Study for the
City of Palo Alto.
The BMR Housing Study will be divided into two phases. The first phase consists of Tasks 1
and 2. These two tasks encompass all of the analytical work required by the work program and
necessary to prepare sound recommendations. Phase II consists of the Public Review Process
(Task 3) and any possible participation by Keyser Marston Associates (KMA) in reviewing new
legal program documents, such as a formal BMR ordinance, that the City’s legal counsel will
have prepared based on the findings of these analyses. This phase also provides for additional
staff meetings as part of the Phase II work scope.
PHASE I
Task 1. Housing Inventory and Related Analyses
The objective of this task is two-fold. The first is to provide the City with a solid understanding
of its BMR housing stock and the BMR homeowners. The second is to expand and enhance the
existing database so that it provides a full detail of each BMR unit and can easily be updated and
manipulated to generate useful periodic reports. KMA/AA’s role is to be limited to:
(a) Reviewing and advising the City on the data fields to be included in the database;
(b)Developing the format of the periodic reports to be generated by the database and
provide software recommendations; and
(c)Advising the City on the content and mechanics of conducting the owner survey in
order to generate useful data for the BMR policy analyses.
The City will input data into the database, develop a set of images of the inventory, develop a
computer model to generate the periodic reports, and conduct the survey of BMR owners and
compile the results.
The specific subtasks to be undertaken by KMA are as follows:
I. 1. Background on Current Issues
KMA and AA will meet with the City and Palo Alto Housing Corporation (PAHC) to further
define the City’s goals for the analyses as well as challenging issues facing the BMR program.
The team will review all pertinent existing documents, such as copies of deed restrictions and
administrative procedures.
I. 2, Amend Inventory of Existing BMR Ownership Units
I45VIA/AA will review the database and suggest modifications to the data fields. KMA will also
provide recommendations regarding the most effective computer software to be used.
I. 3. Analyses of Inventory of Existing BMR Ownership Units
KMA/AA will work with staff to determine the content and format of summary reports that can
be generated from the database. One element to be tracked is-the approximate equity that has
accrued for each BMR home and for the entire Program. To estimate accrued equity, KMA will
review recent home sales in each neighborhood for similar homes.
1.4. Survey of BMR Owners
KMA will advise the City on the mechanics of conducting the survey and compiling results.
KMA/AA will also review and comment on the survey questionnaire prepared by the City.
I. 5. Work Products for Task 1
KMA will prepare the work products specified in the RFP, including two administrative drafts, a
public draft~ and a final document for each of the following:
¯Additions/edits to inventory template;
¯Additions/edits to survey instrument
¯Sample summary report templates from inventory database; and
~Estimate of total equity that has accrued for each BMR owner unit and the BMR program
as a whole.
I. 6. Meetings
KMA/AA will participate in two meetings with staff. The purpose of the first meeting will be to
kick-off the study. The second meeting will be to discuss survey questions and the draft
templates for the summary reports.
Task II.A - Analyses of BMR Unit Value and Maintenance
The basic structure for the following analyses will be to first review the Program’s existing
provisions, compare the provisions to those of other successful programs, evaluate (where
appropriate) the economic impacts of the existing provisions to alternative provisions, and then,
based on the analyses, recommend specific changes to the existing Program.
II.A. 1. Initial Sales Price for New Units
The purpose of this task is to evaluate the existing formula for establishing the maximum
affordable price at which developers can sell the deed restricted affordable units contained in
their project. The objective is for the formula to maximize affordability while being
economically viable. Under the City’s current program, maximum prices are based on a
comparison of an income:driven pricing formula. KMA will evaluate the terms of the existing
formula in terms of its impact on allowable prices, impact on project feasibility, ease of
administration, and consistency with the policies of other jurisdictions in the State. To evaluate
prices, KMA will evaluate the development economics ofprototypical condominium,
townhouse, and single-family developments in Palo Alto. Based on this evaluation, KMA in
coordination with AA will recommend a pricing formula for the deed-restricted units in the
future.
II.A.2. Appreciation Schedule
The objective of this task is to determine the most appropriate index and formula for calculating
permitted appreciation in home prices and equity returns to homeowners for both existing and
newly built BMR units. KMA/AA will identify the appreciation terms of other successful
programs and compare the impacts of the existing program’s terms to those of other programs.
KMA will prepare examples of the application of various different formulas with up to three
different prototypes of BMR stock for staff’s review. The examples will show financial returns
to the seller (and City) under a range of assumptions regarding market appreciation, appreciation
that can be realized by the seller, and deed restriction provisions. Based on this comparison, the
Team will provide recommendations for amending the appreciation terms of the Program. The
appreciation terms can then be incorporated into the deed restrictions.
II.A. 3. Maintenance and Treatment of Capital Improvements on Resale
The focus of this task is to evaluate mechanisms by which the homeowners and the City maintain
the BMR units in good, marketable condition through repairs, rehabilitation, and capital
improvements. KMA will review the existing deed restrictions to determine if the existing
provisions in the deed restrictions function as a disincentive to owners to improve their units. If
appropriate, KMA will prepare comparative economic analyses to illustrate economic impacts of
alternative provisions. KMA and AA will prepare recommendations based on our collective
experience, a review of the existing program, a review of the existing program, a review of
available outside funding sources for repairs, rehabilitation, and capital improvements grants and
loans, and .information gathered by the homeowner survey. The team’s recommendations will be
provided in sufficient detail to be incorporated iiato the deed restrictions and/or the Procedures
Manual.
II.A. 4. Major Special Assessments for Capital Repairs and Increasing Monthly Condominium
Dues
Uncontrolled HOA dues and major special assessments are important issues facing many BMR
programs. KMA/AA will evaluate alternative techniques and ease of administration for handling
major special assessments and increases in monthly HOA fees, the effectiveness of the existing
BMR Emergency Loan Program and identify potential sources of ongoing funds.
II.A. 5. Work Products for Task 2A
ICMA!AA will prepare a series of interim technical memorandums for each issue. The format of
the formal documentation will be determined in collaboration with City staff.
II.A. 6. Meetings for Task 2A
Two meetings with staff are envisioned for this task.
discuss preliminary findings and conclusions.
The purpose of the meetings will be to
Task II.B -Deed Restrictions
II.B. 1. Impact of Deed Restrictions on Buyer Financing
There has been considerable movement on the part of lending ins.titutions regarding the priority
pos.ition of the affordability covenants vis-it-vis the lender’s first deed of trust. KMA will
evaluate the covenants in light of these recent changes. KMA will work with the City’s legal
counsel to identify conceptual deed restrictions that meet the City’s needs and are likely to be
accepted by the lending community based on past experience. AA will take the lead in advising
on sources of down payment assistance that are compatible with the City’s deed restrictions.
II.B. 2. Enforcement of ~Program Requirements within Deed Restrictions
AA will research and propose provisions in the deed restrictions that will prevent and enforce
¯ BMR program requirements, in particulars: owner occupancy of unit, prohibition of rental of
unit, and prohibition of transfer without City review and consent.
II.B. 3. Implementing New Deed Restrictions
KMA and AA will collaborate with City staff and legal counsel regarding establishing the
elements of new deed restrictions, including securing the City’s position with a silent second
deed of trust, and providing for a sale to an income-eligible buyer and a sale at Fair Market
value.
II.B. 4. Work Product of Task II. B
KMA/AA will prepare a series of technical memoranda for each issue, including a summary of
each recommended change to the existing deed restrictions.
II.B.5. Meetings for Task II.B
Two meetings are anticipated for this task.
Task II.C - Administrative Procedures for the Sale and Resale of BMR Units
II. C. 1. Waiting List Administration and Resale Process and Procedures
AA will review the deed restrictions, waiting list, BMR application, the BMR Policies and
Procedures manual, BMR information package, resale procedures and other related documents.
AA will compare the procedures of the existing Program for administering the waiting list,
application screening, buyer selection, and resale of BMR units to those of other successful
programs in the State.
II. C. 2. Work Product for Task 2C
AA will prepare a draft memorandum evaluating the City’s procedures related to the waiting list,
application screening, buyer selection, and resale process and timeline; presenting and evaluating
alternatives, including how improvements can be made to the unit between owners; and making
recommendations.
II. C.3. Meetings for Task 2C
Two meetings are envisioned for this task. AA and KMA will first meet with staff of the City
and PAHC to discuss the strengths and weaknesses of the existing process. The purpose of the
second meeting will be to discuss the evaluation and recommendations.
Task II.D - BMR Program Implementation: Policy Analysis
KMA will explore ways in which the existing program could be modified to both increase in-lieu
fee revenue generation and the production of BMR units. A third subtask will explore maj or
policy change away from BMR ownership unit production in favor of increasing the supply of
BMR rental units with the basic framework of the existing program assumed as a given - that is
the percentage requirements and income levels are not subject to change.
II.D. 1. In-Lieu Formula for BMR Housing
KMA will analyze the existing in-lieu formula and how it compares to other traditional
approaches to establishing the in-lieu equivalents to building required BMR units. Since the
formula is applied to a range of residential types and price ranges, the analyses must cover the
application of in-lieu measures to the full spectrum of new units in the Palo Alto Market. In
order to accomplish this task, KMA will:
Meet with staff to discuss the existing in-lieu formula and how its history, any perceived
difficulties or shortcomings and initially to brainstorm alternatives. Assemble
information, with the help of City staff, on residential construction activity - number of
units in typical in-fill projects, number of units per year by project size, etc.
Conduct market survey covering rental and ownership units. For ownership units, survey
a cross section of new (or recent) condominium, townhouse and single family detached
units selling in Palo Alto to ascertain sales price per unit and square foot, b major
amenities, and geographic patterns of the marketplace. For rental units, survey rent levels
for newer units, research information on operating expenses per unit, including property
taxes, and establish unit values.
Confirm affordable prices for various size ownership units, based on the City’ formula
and current income levels. Similarly, confirm rental unit affordable rents and derive unit
values. Compare market rate prices and rent levels to the affordable unit values. For all
types of units, establish affordability gaps.
Translate affordability gaps to in-lieu equivalents using a number of approaches such as
the City’s existing percentage approach, fixed or sliding scale fees on per unit owed
basis, per unit in the project basis. Identify practices in other jurisdictions. Explore per
square foot fee approaches, as have been employed in some of the more recently adopted
inclusionary BMR programs.
Review the City’s current and past practices for applying in-lieu fees to special
applications and compare to practices elsewhere. Special applications include very small
projects, single-family detached projects and subdivisions. Evaluate if the City could use
different practices to improve efficiency without reducing revenue.
Summarize options for the City for structuring in-lieu fees and other modifications to
maintain or increase the revenue currently generated by the fee program. Conduct
telephone interviews with selected jurisdictions that have differing practices for input on
effectiveness. Summarize the pros and cons of each option from several standpoints,
such as administrative aspects, perceived fairness, any influence on how residential
projects are configured, etc.
II.D. 2 Increasing the Supply of BMR Units
Explore options for increasing the supply of BMR Units appropriate to the most critical
affordable housing needs of Palo Alto. As a first step, KMA will confer with City staff and
reach agreement on what the most critical needs are. KMA will examine BMR applications to
specific situations, such as those indicated below, and recommend adjustments to Palo Alto
practices that would increase BMR Unit production.
Application procedures with respect to R-1 subdivisions, particularly for the condition
where the developer that subdivides is not likely to also be the end builder.
Application procedures with respect to rentalswith condo maps, and the demolition of
rental housing. Explore practices elsewhere, seek out pitfalls and best practices, and
recommend accordingly.
Application of program elements relative to applying BMR requirements to senior
assisted living facilities, e.g., approaches to handling monthly charges. KMA
recommendations will be based on experience with other programs and limited additional
research.
Density Bonus. Assist with applying State Law provision to the Palo Alto program and
explore how Palo Alto might incorporate its oma version of a DenSity Bonus into its
ordinance. This task will address differences in income levels in the two programs,
equivalencies of the affordability requirements, the value of the bonus as relates to land
costs per unit and related topics.
Evaluate options for increasing production of BMR units in specific situations. Assist
staff withexamining options to alter the program when very large size units are proposed.
II.D.3. Evaluate the BMR program ’s history, pelformance and original goals and objectives in
light of the current local housing market and the City’s affordable housingprogram.
Assess to what extent the program has or has not met the City’s original objectives, to evaluate
the City’s current needs, and to identify potential program changes to best meet the City’s
current and anticipated needs.
To set the context for the evaluation, KMA proposes to:
Review ofthe City’s original goals and objectives for the BMR program, the market
conditions that shaped these objectives, and the City’s original thoughts on the
administrative effort/expense that would be required;
Review of the performance of the BMR program. Much of this information will be
generated from the inventory review, discussions with City. staff, as well as the survey of
owners. Examine to what extent has the BMR program has facilitated transition to
market rate ownership housing?
Assess the City’s current affordable housing needs in terms of ownership versus rental,
level of affordability, target populations, etc. based on disCussions with staff and a review
of ABAG regional housing needs data.
II.D. 3.A. Conduct a Policy Analysis and Evaluation with quantification of the economic impacts
and benefits to the City’s Affordable Housing Program, of major policy changes to the BMR
Program.
As an initial step, KMA will prepare a qualitative assessment of each of the five alternative
structures (two for existing ownership properties and three for new developments). The
qualitative assessment would evaluate each alternative relative to the following criteria:
City Administration/Cost/Implementation!Institutional Factors,
Required City Financial Participation,
Result in increase in BMR units,
Populations or constituencies served,
Compatibility with balance of project,
Feasibility from the Private Market/Developer’s Perspective,
Feasibility from the Existing Owner’s Perspective, and
Legal Factors
This initial qualitative assessment will be presented in the format of a matrix, which will enable
policy makers to easily compare the pros and cons and tradeoffs of each alternative. This initial
qualitative assessment will be used to narrow the feasible alternatives for a quantitative/detailed
assessment. The types of analyses that are likely include:
Quantify fee revenues resulting from altered policies related to new ownership projects.
Fees will be based on the in-lieu quantification task above (II.D. 1) and rate of
construction based on historic performance or other scenario if requested by City staff.
In-lieu fee amounts will be considered on average units and on a range basis (i.e., explore
varying the fee amount by the price range of the market rate units in the project).
Evaluate aspects of converting existing BMR ownership units to market rate units and
City receiving the sales proceeds over and above the proceeds owed to the seller.
Quantify, on an order of magnitude basis, the revenue the City would realize from
conversion of each BMR unit (built at various time periods). Identify the number of units
likely to transition each year, based on past history (or possibly with an incentive
program). Worldng with City staff and legal input, .identify administrative aspects of
transitioning units. With City input, estimate staff costs per unit for each transition.
Summarize non-quantifiable aspects of the conversion option.
Evaluate aspects of requiring new ownership projects to set aside units for rental instead
of ownership. Quantify the cost/burden to the developer equivalency aspects. Identify
issues this option raises with respect ownership of the rental unit, management of the
unit, operating expenses, other condo owners in a project, HOA contributions, etc.
II.D. 4. Work Product for Task IID
KMA will prepare three technical memoranda summarizing the analysis, findings, and
recommendations for each of the task groups.
II.D. 5. Meetings for Task IID
KMA anticipates two meetings with staff.
PHASE II
Task III- Public Review of Analyses and Participation in New Legal Documents
III.1. Public Review Process
The KMA team will participate in public meetings at the direction of staff. Separate time and
materials costs will be required to prepare for meetings and attend meetings.
III.2. Participation in Preparation of Legal Documents
The KMA team will confer with the City’s legal counsel regarding the preparation of the deed
restrictions and other documents at the City’s election. These services will be provided on a time
and material basis.
o
(D
ATTACHMENT C
WORK PROGRAM
UPDATE OF THE CiTY OF PALO ALTO BNIR PROGRAM
Ju~ 19, 2004
Principal Work Products:
[Not in order of completion or priority]
1) BMR Ordinance for Council adoption
¯2a) New, Revised Deed Restrictions: To be applied to all future
units.
2b) New Legal Documents for Enforcement: To improve notice
and enforcement of the Deed Restrictions
3) Revise Appreciation Formula: Recommendation to increase
the rate of appreciation
4) New and revised Administrative Procedures and Policies
Manual: For use by PAHC and City staff covering all aspects of
program administration
5) BlViR Owner Handbook: For use by BMR owners to
understand conditions ofBMR Program
6) Update Existing Inventory / Expand Database of the City’s
stock of BMR and Discount Units and Rental BMR Units:
Include title search, physical inspections and owner survey, all
versions of deed restrictions and BMR agreements. Examine
mechanisms for periodic ongoing monitoring of title records
7) Develop mechanism(s) to prevent physical deterioration of
older BMR units
8) Improve Administrative Procedures to Increase
Effectiveness and Limit Costs: Analysis of total current
Primary
Responsibility
City Attorney (with review by
outside counsel)
City Attorney
(with input from Consultant)
Consultant
PAHC, Consultant and
Contract Plarmer
Contract Planner
Contract Planner, Intern,
PAHC, Consultant, Real
Estate, Title Search Company
Contract Planner, attorney,
consultant & PAHC
Contract Planner, City
staff, PAHC
H:~BMR Study Matrix Revised Per 2-2-04 Mtg.d~c Page 1
administrative costs; recommend changes to streamline
workload, reduce costs and time expended and increase
effectiveness.
9) Analysis of City’s policy goals & objectives for the BlViR
ownership p~ogram:
A) Summary of program’s history, philosophy and rationale
B) How can City improve its use of the BMR requirement to
increase the City’s affordable housing stock?
C) Analysis of possible major policy changes to the Program
including:
¯Converting existing owner units to rental as owners sell, or
¯Selling existing owner units at market prices & using
proceeds to develop subsidized rental housing
¯ Requiring some or all developers of ownership projects to
provide rental BMR units either within the project or off-site
Taking an in-lieu fee instead of units in all ownership
projects
Consultant (with legal
analysis)
Also contract planner,
PAHC, Staff
H:\BMR Study Matrix Revised Per 2-2-04 Mtg.doc Page 2