HomeMy WebLinkAboutCOW 2009-07-13 Item 5I - Agreement - Hold Harmless for Distribution of Proceeds from Jail Alternative Group Property Sale with City of BellevueCAS NUMber 09-102
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SUMMARY
EU'I?NDI'l'URl? RI ;OUIRI?D
Fund Source:
Comments:
MTG. DATE
7/13/09
MTG. DATE
7/13/09
COUNCIL AGENDA SYNOPSIS
Meeting Date
07/13/09
07/20/09
Mtg Date 07/13/09 AItg Date 07/20/09 illtg Date
Initials
Prepared by 1 Mayor's review 1 Council review
SH I A. 4'
SH
ITEM INFORMATION
ORIGINAL AGENDA D, \'I'E: JULY 13, 2009
Ac;I:NI).\ Authorization for the Mayor to sign a hold harmless agreement with Bellevue
regarding distribution of proceeds from sale of the Jail Alternative Group (JAG)
property.
C,\ t'I:X OR\ Dl scrawl on Motion Resolution Ordinance 1 Bid Award n Public Hearing Other
Mtg Date
AMOUNT BUDGETED
Council Myer Actin Svcs n DCD Finance I ".Fire 1 1 Legal P&R Police PW
Mtg Date
RECORD OF COUNCIL ACTION
ATTACHMENTS
Informational Memorandum dated 6/30/09
Proceeds Distribution and Hold Harmless Agreement
JAG Property Proceeds Distribution (for informational purposes only)
Minutes from the Finance and Safety Committee meeting of 7/7/09
n Planning Comm.
ITEM No.
Altg Date ALtg Date
This agenda item authorizes the Mayor to sign a hold harmless agreement with the City of
Bellevue concerning distribution of proceeds from the sale of the JAG property in Bellevue.
The agreement acknowledges the City's intent to use the proceeds to fund design and
other costs for the SCORE jail facility.
The Council is being asked to authorize the Mayor to sign the hold harmless agreement.
RI C\' E l wl :D BY I COW Mtg. CA &P Cmte F &S Cmte Transportation Cmte
Utilities Cmte LI Arts Comm. I I Parks Comm.
DATE: 7/7/09
RECOMMENDATIONS:
Si NS()R /ADMIN. Finance Department
CommITTEF, Unanimous Approval; Forward to Committee of the Whole
COST IMPACT FUND SOURCE
APPROPRIATION REQUIRED
TO:
FROM:
DATE:
SUBJECT:
ISSUE
BACKGROUND
DISCUSSION
City of Tukwila
INFORMATIONAL MEMORANDUM
Mayor Haggerton
Rhonda Berry
Finance and Safety Committee
Shawn Hunstock, Finance Director
June 30, 2009
JAG Proceeds Distribution and Hold Harmless Agreement
The Proceeds Distribution and Hold Harmless Agreement establishes the following:
Jim Haggerton, Mayor
The City of Bellevue is requesting each JAG City execute a Proceeds Distribution and
Hold Harmless Agreement prior to distribution of the proceeds from the recently
completed sale of the Bellevue JAG property.
In 2002, King County entered into a Land Transfer Agreement with the City of Bellevue
conveying property to Bellevue on behalf of all cities in King County to facilitate the
building of, or contracting for, additional misdemeanant jail capacity so that JAG Cities
could reduce their King County jail housed misdemeanant population to zero by
December 31, 2012. The Jail Services Agreement between certain individual JAG
Cities and King County (JSA) and the Interlocal Agreement for Jail Administration
(Interlocal Agreement) contain provisions related to the expenditure of jail proceeds
from the sale of this property and Bellevue's role in returning proceeds to King County
should these provisions be violated.
Based on the anticipated sale of the jointly owned property, on March 26, 2008, the Jail
Oversight Assembly authorized the distribution of the sales proceeds based on a
formula of an average of each King County city's AV (assessed value) and ADP (inmate
average daily population). The sale of the property closed on March 16, 2009 with a
purchase price of $13 million.
1) The intent of the agreement is to insure that Bellevue stands in no worse (or better)
position than any other JAG City because of Bellevue's unique contractual obligation
to King County to return proceeds if there is a violation of Paragraph 12 of the Jail
Services Agreement,
2) Terms and conditions for a JAG City to receive proceeds from the sale of the JAG
jail property,
INFORMATIONAL MEMO
Page 2
3) Uses to which the proceeds must be spent, and
4) Consequences to JAG Cities should one or more of these Cities either misspend the
proceeds or fail to meet the population reduction goal contained in the JSA and /or
the Interlocal Agreement.
All member cities of SCORE, including Tukwila, expect to allocate the proceeds from
the sale of the JAG property to start -up expenses for the SCORE jail, including design,
site work, permitting and other similar expenses. It is expected that such expenses meet
the requirements of Paragraph 12 of the Jail Services Agreement with King County.
RECOMMENDATION
The Council is being asked to authorize the Mayor to sign the Proceeds Distribution and
Hold Harmless Agreement between the City of Tukwila and the City of Bellevue.
This item is scheduled to be discussed at the July 7, 2009 Finance and Safety
Committee meeting, the July 13, 2009 Committee of the Whole meeting and
subsequent July 20, 2009 Regular Meeting.
ATTACHMENTS
Proceeds Distribution and Hold Harmless Agreement
JAG Property Proceeds Distribution spreadsheet
C:\temp\XPg rpwise\I n foMemoJAGP roceeds. doc
PROCEEDS DISTRIBUTION AND HOLD HARMLESS AGREEMENT
This Proceeds Distribution and Hold Harmless Agreement (Agreement) is entered into
between the City of Tukwila (JAG City) and the City of Bellevue and is effective upon
the date of the last signature below.
RECITALS
A. Whereas, King County entered into a Jail Services Agreement (JSA) with many of the
cities located in King County (Contract Cities) to house and provide jail services for
Contract Cities' misdemeanants;
B. Whereas, the JSA provides for the transfer of real property located in Bellevue with
tax parcel numbers 2825059291, 2825059292, and 2825059015 (Jail Property) to the
City of Bellevue on behalf of the JAG Cities to facilitate the Contract Cities reducing
their jail population housed by King County as provided in Section 11 of said JSA;
C. Whereas, Section 12 of the JSA provides that the Jail Property (or the proceeds from
its sale [Proceeds]) will be used to contribute to the cost of building secure capacity,
or contracting for secure capacity, and at the sole discretion of the Contract Cities,
building or contracting for alternative corrections facilities, sufficient to enable the
Contract Cities to meet the final step of the population reduction schedule in the JSA;
D. Whereas, Section 12 of the JSA further provides that in the event the Contract Cities
do not meet the objectives set forth in said section, King County would be entitled to
return of Proceeds;
E. Whereas, on October 31, 2002, the City of Bellevue and King County entered into a
Land Transfer Agreement [City of Bellevue Clerk's Receiving 33014] conveying
the Jail Property to the City of Bellevue on behalf of all cities in King County (JAG
Cities) for the purposes described in Section 12 of the JSA;
F. Whereas, JAG Cities, except Kent and Enumclaw, entered into an Interlocal
Agreement for Jail Administration (Interlocal Agreement) in part to create rules for
administering the obligations related to Sections 11 and 12 of the JSA;
G. Whereas, the obligations of Section 12 of the JSA are incorporated into Section 7.1 of
the Interlocal Agreement including its application to all King County Cities;
H. Whereas, on March 16, 2009, the City of Bellevue (Bellevue) sold the Jail Property to
Seattle Children's Hospital for $13 million;
I. Whereas, on March 26, 2008, the Assembly created by the Interlocal Agreement
approved the distribution of Jail Proceeds;
1 June 10, 2009
J. Whereas, some Cities have acted to designate their portion of the Proceeds towards
fulfilling their obligations under the JSA through undertakings such as the SCORE
facility;
K. Whereas, it is the intent of this Agreement that Bellevue stand in no worse (or better)
position than any other JAG City with respect to liability or costs associated with the
distribution of and /or possible return of Proceeds to King County because of its
unique obligations to King County in Section 12 of the JSA as incorporated into the
Interlocal Agreement (unique Section 12 obligations);
L. Now therefore, in consideration of the mutual promises contained herein and other
good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, and as a precondition for receipt of said Proceeds, the JAG City and
Bellevue agree:
AGREEMENT
1. Per the Jail Oversight Assembly approved formula noted in the city -by -city proceeds
distribution (Attachment A), Bellevue shall pay JAG City, $287,711.75 (representing
$289,916.34 its proportionate share of the Proceeds, including interest, minus
$2,204.58 its proportionate share of the expenses Bellevue may recoup as provided in
Section 7.2 of the Interlocal Agreement) within 30 days of the execution of this
Agreement.
2. Upon receipt of said Proceeds, JAG City acknowledges and agrees that Bellevue has
lawfully discharged all obligations and duties of Bellevue to that JAG City under the
first paragraph of Section 7.2 of the Interlocal Agreement, and that Bellevue is
discharged from all of its obligations and duties to that JAG City under the second
paragraph of Section 7.2 of the Interlocal Agreement.
3. JAG City will abide by all requirements regarding the use of and goals related to the
proceeds as provided in Section 7.1 of the Interlocal Agreement (whether a party to a
JSA or not). JAG City will only leave or place a City Inmate in King County Jail
after December 31, 2012 (post 2012 inmate housing) if King County confirms in
writing that this post 2012 inmate housing does not violate the population reduction
schedule referenced in Section 12 of the JSA and incorporated into Section 7.1 of the
Interlocal Agreement.
4. Should there be a determination that a JAG City failed to abide by the requirements
of Section 7.1 (at -fault JAG City) triggering an obligation for Bellevue to return all or
part of the at -fault JAG City's Proceeds and any required interest to King County,
said Proceeds shall be paid to Bellevue within 10 working days of written notice
unless the at -fault JAG City makes other acceptable arrangements with Bellevue
and /or King County or the at -fault JAG City obtains injunctive or other legal relief
2 June 10, 2009
against King County that absolves Bellevue of any legal obligation to return said
Proceeds and interest prior to the expiration of the 10 working day period.
5. Bellevue and JAG Cities maintain that King County may only require return of
Proceeds from an at -fault JAG City. However, if there is a determination that there is
an obligation to return to King County Proceeds in an amount in excess of the amount
distributed to an at -fault JAG City(s) then each non at -fault JAG City shall pay up to
the full amount of its Proceeds and any required interest to Bellevue within 10
working days of written notice unless the non at -fault JAG City makes other
acceptable arrangements with Bellevue and /or King County or the non at -fault JAG
City obtains injunctive or other legal relief against King County that confirms
Bellevue has no legal obligation to return said Proceeds and interest prior to the
expiration of the 10 working day period. If the obligation to return Proceeds is in
excess of the at -fault JAG City's distribution, but less than each JAG City's full
Proceeds, the amount due King County from the non at -fault JAG Cities shall be a
prorated amount based on the percent of Proceeds received to the total Proceeds
minus the amount representing the at -fault JAG City's share. The same prorated
formula shall apply to required interest due from non at -fault JAG Cities.
6. Should Bellevue be sued for return of proceeds solely because of its unique Section
12 obligations, the alleged at -fault JAG City(s) shall immediately undertake the
defense of Bellevue and pay all expenses and costs (including attorney's fees)
associated with said defense whether or not said JAG City maintains it is or is
ultimately determined to be not at- fault. Should King County be entitled to its
attorney's fees in the suit, the at -fault JAG City shall hold Bellevue harmless and
indemnify Bellevue from any liability or costs associated with the obligation to pay
King County's attorney's fees.
7. Should Bellevue be the only party sued based on the alleged fault of other JAG Cities,
those alleged at -fault JAG Cities agree to stipulate to being named as defendants with
the concurrence of Plaintiff and /or not oppose Bellevue's motion to be included in the
suit as an indispensible party. The obligations of Paragraph 6 shall apply whether or
not the alleged at -fault JAG City is named in the litigation.
8. If King County sues Bellevue for return of proceeds because of Bellevue's alleged
violation of Section 12 of the JSA regarding use of proceeds or the reduction in jail
population along with other JAG Cities for their violations, each party will undertake
its own defense at its own cost.
9. At -fault JAG Cities shall be responsible for costs of whatever form or nature
associated with Bellevue's unique Section 12 obligations, including but not limited to
staff costs in coordinating and collecting proceeds or attorneys fees, and including
administrative costs Bellevue incurs even where timely payment of Proceeds is made.
Said costs shall be prorated among at -fault JAG Cities as appropriate.
3 June 10, 2009
10. In the event Bellevue incurs liability or costs associated with its unique Section 12
obligations and said liability or costs are not addressed in any other provision of this
Agreement, each JAG City shall indemnify, hold harmless and defend Bellevue and
its elected officials, employees agents and representatives from and against any and
all claims, demands, causes of action, liabilities, judgments, settlements, damages or
costs, including reasonable attorney's fees of whatever form related to Bellevue's
unique Section 12 obligations in proportion to its share of the proceeds.
11. Each JAG City shall keep its Proceeds in a segregated fund and keep records
sufficient to demonstrate that all expenditures of the Proceeds comply with Section
7.1 of the Interlocal Agreement. Said records shall be kept for at least 6 years from
the date of the expenditure of the last Proceeds of the JAG City.
12. The JAG City representative who will be responsible for management and
expenditure of the fund and for receiving notices related to the obligations under 7.1
of the Interlocal Agreement is (include name, title, address phone
a. City Clerk, City of Tukwila
6200 Southcenter Blvd.
Tukwila, WA 98188
JAG City shall notify Bellevue of any change in this designated representative or
contact information.
13. The City of Bellevue as a recipient of $971,638.82 (representing $979,083.99 its
proportionate share of the Proceeds, including interest, minus $7,445.16 its
proportionate share of the expenses) is also a JAG City and in that capacity shall be
bound by the same terms under this Agreement as any other JAG City.
14. This Agreement shall be authorized by each JAG City's legislative body or other
authorizing authority if not within authority of legislative body.
15. General Provisions:
A. Governing Law; Forum. The Agreement will be governed by the laws of
Washington and its choice of law rules. The JAG City consents to the exclusive
personal jurisdiction and venue of the federal and state courts located in King
County, Washington, with respect to any dispute arising out of or in connection
with the Agreement, and agrees not to commence or prosecute any action or
proceeding arising out of or in connection with the Agreement other than in the
aforementioned courts.
B. Severability. If any provision of the Agreement is held to be invalid or
unenforceable for any reason, the remaining provision will continue in full force
without being impaired or invalidated in any way. The parties agree to replace
any invalid provision with a valid provision that most closely approximates the
intent and economic effect of the invalid provision.
4 June 10, 2009
By:
Title:
By:
Title:
C. Nonwaiver. Any failure by a party to enforce strict perfoimance of any
provision of the Agreement will not constitute a waiver of that party's right to
subsequently enforce such provision or any other provision of the Agreement.
D. No Assignment. Neither the Agreement nor any of the rights or obligations of
the JAG City arising under the Agreement may be assigned without Bellevue's
prior written consent. Subject to the foregoing, the Agreement will be binding
upon, enforceable by, and inure to the benefit of, the parties and their successors
and assigns.
E. Notices. All notices and other communications under the Agreement must be in
writing, and must be given by registered or certified mail, postage prepaid, or
delivered by hand to the party to whom the communication is to be given, at its
address set forth in this agreement.
F. Legal Fees. In any lawsuit between the parties with respect to the matters
covered by the Agreement, the prevailing party will be entitled to receive its
reasonable attorney's fees and costs incurred in the lawsuit, in addition to any
other relief it may be awarded.
G Counterparts. The Agreement may be signed in counterparts, each of which
shall be deemed an original, and all of which, taken together, shall be deemed
one and the same document.
In witness whereof, the parties have executed this Agreement and it shall be effective as
of the last date written below.
CITY OF TUKWILA
CITY OF BELLEUVE
Date:
Date:
5 June 10, 2009
JAG Property Proceeds Distribution, Methodology Approved by the Jail Oversight Assembly
on March 26, 2008
Cities
Algona
Auburn
Beaux Arts
Bellevue
Black Diamond
Bothell
Burien
Carnation
Clyde Hill
Covington
Des Moines
Duvall
Enumclaw
Federal Way
Hunts Point
Issaquah
Ken more
Kent
Kirkland
Lake Forest Park
Maple Valley
Medina
Mercer Island
Milton
Newcastle
Normandy Park
North Bend
Pacific
Redmond
Renton
Sammamish
SeaTac
Seattle
Shoreline
Skykomish
Snoqualmie
Tukwila
Woodinville
Yarrow Point
Sale Price
$12,986,694.50
Avg. of AV
ADP (1)
523,168.33
5801,366.31
52,520.18
6970,635.68
$13,282.47
5126,754.71
5152631.47
$6,301.24
542,491.88
$66, 049.99
$1 77,128.08
527, 973.08
590,688 23
5591,788.18
518, 431.60
6219,690.57
5124,016.44
61,166,452.48
5425,046.74
$80,748.97
555, 716.09
576, 614.51
5215,059.90
$1,943.87
553, 960.39
$34,419.82
$26,466.09
514,058.03
5454,343.94
51,002,868.14
5208,156.50
5163,329.98
$4,707.346.10
5385,405.07
51,61792
$67,185.14
5287,414.71
$86,231.67
$17,390,02
512,986,694.50
Adminlother costs
$99,613.08
Proportionate Share
of Costs (2)
$177.71
$6,146.80
519.33
$7,445.16
5101.88
$972,26
51,170.74
548.33
6325.93
$506.63
51.358.64
5214.56
5695,61
54,539.25
5141.38
61,685.11
5951.26
$8,947,15
$3,260.28
5619,38
S427.36
5587.66
$1,649.59
$14.91
5413.90
5264.01
S203.01
6107.83
63.485.00
57,692.40
51, 596.64
51,252.81
536,107.21
62,956.21
512.41
5515.34
52, 204.58
5661.43
6133.39
$99,613.08
Interest/Revenue
$113,034.78
Proportionate Share
of Revenues (3)
5201.65
56,975.01
521.94
58,448.31
5115.61
51,103.26
51.328.49
654.85
5369.84
6574.89
51,541.70
6243.47
$789.34
$5,150.86
5160.43
51,912.16
51,079.43
510,152.68
$3,699.56
5702.83
5484.95
5666.84
51
516.92
5469.67
5299.59
5230.36
$122.36
$3.954.56
$8,728.86
51,811.77
51,421.61
540,972.23
53,354.52
$14,08
6584,77
52.501.63
6750.55
5151.36
5113,034.78
Cities' Distribution
$13,000,116.20
Final City -by -City
Proceeds
Distribution
$23,192.28
5802.194.52
52.522.78
$971.638.82
$13.296.20
126.885.71
5152.7 89.21
56,307.75
$42.535.80
$66,118.25
5177,311.14
528.001,99
590.781.96
5592.399.79
518.450.65
5219,917.62
5124.144.61
61,167,658.01
$425,486.02
$80,832.42
$55,773.68
$76,693.70
5215,282,16
51,945.88
554,016.16
534,455.39
$26,493.44
$14,072.56
$454.813.50
51,003,904.60
5203,371.63
5163,498.78
54,712,211.12
5385,803.38
$1,619.59
567,254.57
$287,711.75
$86,320,79
517,407.99
$13,000,116.20
NOTES:
(1) The proceeds formula is an average of
each city's AV and ADP. Assessed Value
(AV) was derived from the King County
Assessors Office estimates for 2007.
Average Daily Population (ADP) was based
on 2005 -2007 data provided by each city.
The methodology was approved at the March
26, 2008 Jail Oversight Assembly Meeting.
(2) The costs were incurred by the City of
Bellevue on behalf of the rest of the cities anc
are recoupable as provided in Paragraph 7.2
of the Interlocal Agreement.
(3) This column includes all interest
generated to -date in the account holding the
sale property proceeds.
CRAFT:
6/' 0/09
Finance Safety Committee Minutes July 7. 2009 Paae 2
Cascade Water Alliance will be issuing approximately $96 million dollars in bonds for the purchase of
Lake Tapps and for the settlement of water rights issues. As a member of Cascade Water, the City of
Tukwila must give approval to continue providing disclosure of certain information which is required by
the bond purchase agreement as well as provide financial and operating information for CWA's official
statement.
Rates already include repayment of this debt, meaning this item will not result in an additional increase in
water rates. UNANIMOUS APPROVAL. FORWARD TO JULY 13 COW FOR DISCUSSION.
C. Proceeds Distribution Hold Harmless Agreement for Sale of Jail Administrative Group (JAG) Property
Staff is seeking full Council authorization for the Mayor to sign a Proceeds Distribution and Hold
Harmless Agreement with the City of Bellevue for the recent sale of the Jail Administrative Group owned
property located in Bellevue.
Originally purchased jointly by JAG cities, this property is no longer needed for its intended purpose and
was sold earlier this year. In order to receive the funding disbursement from this sale, all JAG cities must
sign this Proceeds Distribution and Hold Harmless Agreement. This Agreement establishes the
appropriate use of proceeds and consequences for misuse. It is estimated that the City of Tukwila will
received approximately $287,000, all of which will be utilized for expenses relative to the SCORE jail
(this funding must be used for jail purposes). UNANIMOUS APPROVAL. FORWARD TO JULY 13
COW FOR DISCUSSION.
D. Fire Department
Staff is seeking full Council approval to purchase mass casualty supplies (including: tools, trailers,
equipment and medical supplies) from various vendors in the amount of $222,053.35.
The funding for this purchase will come from the Fire Equipment Cumulative Reserve (Fund 107).
Several years ago Sound Transit provided mitigation of approximately $1.5 million to the City for Fire
Department purchases relative to the light rail project. The Fire Department has utilized portions of the
mitigation to purchase such items as an aerial truck, fire hose and equipment all of which will assist with
emergency responses involving link light rail. Approximately $328,000 remains from the original
mitigation payment.
Committee members requested several clarifications be made to the information memo which will go to
full Council:
Clarify the funding mechanism as South Transit mitigation funds
Provide a grand total of the funds being requested reflecting the complete expenditure
Give a brief history which shows the amount of funding the City received from Sound
Transit, and what items have been purchased and respective costs.
Staff further explained the rotation schedule for mass casualty supplies and equipment specifications and
that state approved bidders' list. UNANIMOUS APPROVAL. FORWARD TO JULY 13 COW FOR
DISCUSSION.
E. Sales Tax Report: April 2009
Shawn Hunstock reviewed the April Sales Tax Report, noting that numbers showed a minimal
improvement. Sales tax receipts continue to be below budget for the year. If receipts continue to remain at
this level, the City may need to consider other options for addressing such financial issues.
INFORMATION ONLY.
III. MISCELLANEOUS
Acting Committee Member Hernandez mentioned blogs that are utilized by the Seattle Police and Fire
Departments and circulated front page samples of each. She commented that she would like to see the