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HomeMy WebLinkAboutReg 2012-09-04 Item 4D - Contract Amendment - Tukwila Urban Access (Klickitat) LID #33 with Foster Pepper for $25,000COUNCIL AGENDA SYNOPSIS AGENDA ITEM TITLE Initials Meeting Date Prepared by Ma or's review 09/04/12 PMC� ITEM INFORMATION STAFF SPONSOR: PEGGY MCCARTHY Council review ITEMNO. F ORIGINAL AGENDA DATE: 0 9/04/12 Tukwila Urban Center Access (Klickitat) Project LID Foster Pepper PLLC Bond Counsel Contract Amendment CATEGORY Discussion ®Motdonl Consent Resolution Ordinance Bid Award Public Hearing Other Mtg Date Mtg Date 09104112 Mtg Date Mtg Date Mtg Date Mtg Date Mfg Date SPONSOR Council Mayor HR DCD Finance Fire IT P&R Police PWI SPONSOR'S The City has an existing contract with Foster Pepper PLLC as its Bond Counsel for the SUMMARY Tukwila Urban Center Access (Klickitat) Project Local Improvement District. The original contract did not include litigation services. This amendment provides these services, if litigation does occur. The Finance Department is seeking Council approval for the Mayor to sign the contract amendment with Foster Pepper PLLC. REVIEWED BY COW Mtg. CA &P Cmte F &S Cmte Transportation Cmte Utilities Cmte Arts Comm. Parks Comm. Planning Comm. DATE: 08/21/12 COMMITTEE CHAIR: DE'SEAN QUINN RECOMMENDATIONS: SPONSOR /ADMIN. Finance Department COMMITTEE Unanimous Approval; Forward to Committee of the Whole COST IMPACT/ FUND SOURCE EXPENDITURE REQUIRED AMOUNT BUDGETED APPROPRIATION REQUIRED $25,000.00 $1,525,000.00 $0.00 Fund Source: 104 ARTERIAL STREETS (PG 13, 2012 CIP) Comments: MTG.DATE1 RECORD OF COUNCIL ACTION 9/4/12 1 MTG. DATE J ATTACHMENTS 9/4/12 Informational Memorandum dated 08/21/12 2009 Contract with Foster Pepper PLLC Draft Contract Amendment with Foster Pepper PLLC Minutes from the Finance and Safety Committee meeting of 08/21/12 21 22 City of Tukwila FROM: BY: DATE: SUBJECT ISSUE Jim Haggerton, Mayor INFORMATIONAL MEMORANDUM Mayor Haggerton Finance Safety Committee Peggy McCarthy, Finance Director Richard Takechi, Fiscal Coordinator August 21, 2012 Amending Contract #09 -130 Between the City of Tukwila and Foster Pepper PLLC Amend Contract #09 -130 between the City and Foster Pepper PLLC to provide for up to $25,000 of litigation services and thereby increasing the total contract to $63,040. BACKGROUND The City has retained Foster Pepper PLLC as its Bond Counsel as it relates to the Tukwila Urban Center Access (Klickitat) Project Local Improvement District. The current contract excludes litigation services. The amendment will allow Foster Pepper PLLC to perform certain litigation services should any LID property owners contest the assessment role or related decisions. This amendment will increase the contract to over $40,000, thus, needing Council approval. DISCUSSION The attached proposed amendment will increase the contract in an amount not to exceed $25,000 in the event of litigation. The City is anticipating appeals to the Hearing Examiner, and consequently, potential litigation. This amendment will cover that cost, the exception being litigation which is appealed to the superior court. If this occurs, the City would have the discretion of modifying this agreement or utilizing other sources. This $25,000 amendment will increase the original contract amount not to exceed $63,040. Having Foster Pepper PLLC perform the services will appear fair and unbiased as a third party. RECOMMENDATION The Council is being asked to authorize the Mayor to sign the contract amendment in an amount not to exceed $25,000 and the entire contract not to exceed $63,040 and forward this item to the Consent Agenda of the September 4, 2012 Regular Meeting. ATTACHMENTS Amendment to contract #09 -130. Contract #09 -130. 23 24 CITY OF TUKWILA CONTRACT FOR SERVICES Amendment 1 Between the City of Tukwila and Foster Pepper PLLC That portion of Contract No. 09 -130, 4A between the City of Tukwila and Foster Pepper PLLC is amended as follows: 4.A. Payment for the work provided by Bond Counsel shall be made as provided on Exhibit C attached, provided that the total amount of payment to Bond Counsel for Bond Counsel work shall not exceed $17,640 plus $5,400 for a total of $23,040. This amount is based on the current estimated maximum bond amount of $9,500,000. Payment for the work provided by Bond Counsel for special counsel services, including special counsel work previously performed under the Original 2006 Agreement, shall not exceed $15,000. In the event of litigation in connection with the formation of the LID or the assessment roll confirmation, or related contested hearings, with the exception of an assessment appeal to superior court, Bond Counsel will represent the City for work in an additional amount not exceeding $25,000. If an assessment(s) is appealed to superior court, then the City has the option to amend this Agreement as it pertains to this type of litigation. The maximum amount payable under this Agreement (including special counsel work previously paid) shall not exceed $63,040 without a written modification of this Agreement signed by both parties. All other provisions of the contract shall remain in full force and effect. Dated this day of 2012. FOSTER PEPPER PLLC Contractor Hugh Spitzer, em ATTEST/ AUTHENTICATED Christy O'Flaherty, MMC, City Clerk CITY OF TUKWILA Jim Haggerton, Mayor APPROVED AS TO FORM City Attorney Date approved by City Council (Applicable if contract amount is over $40,000) contractamend.doc 57235859.1 25 26 09 -130 Council Approval N/A AGREEMENT FOR BOND COUNSEL. SERVICES THIS AGREEMENT is entered into between the City of Tukwila, Washington (the "City and Foster Pepper PLLC ('Bond Counsel in consideration of the mutual benefits, terms, and conditions hereinafter specified. This Agreement supersedes and replaces a similar agreement entered into in 2006 (the "Original 2006 Agreement 1. Project Designation. Bond Counsel is retained by the City to perform bond counsel services and special counsel services in connection with the Southcenter Urban Access Improvement Project Local Improvement District (the "LID"). 2. Scope of Services. Bond Counsel agrees to perform the bond counsel services described on Exhibit A attached, and the special counsel services described on Exhibit B attached. 3. Commencement of Performance. Work under this contract has commenced under the terms of the Original 2006 Agreement. 4. Payment. Bond Counsel shall be paid by the City for completed work and for services rendered under this Agreement as follows: A. Payment for the work provided by Bond Counsel shall be made as provided on Exhibit C attached, provided that the total amount of payment to Bond Counsel for Bond Council work shall not exceed $17, 640 plus $5,400 for a total of $23,040. This amount is based on the current estimated maximum bond amount of $9,500,000. Payment for the work provided by Bond Counsel for special counsel services, including special counsel work previously performed under the Original 2006 Agreement, shall not exceed $15,000. The maximum amount payable under this contract (including special counsel work previously paid) shall not exceed $38,040 without a modification of this Agreement signed by the City.The parties recognize that this maximum amount for special counsel work does not contemplate Bond Counsel representing the City in any litigation challenging the formation of the LID or challenging the assessment roll. B. Bond Counsel may submit invoices to the City once per month for special counsel services during the progress of the work for partial payment for that portion of the project completed to date. Special counsel invoices should identify the attorney or legal assistant performing the work, the date of the work, a short description of the tasks performed, and the amount charged for that work. Both special counsel and Bond Counsel work should summarize expenses charged. Invoices will be checked by the City and, upon approval thereof, payment shall be made to Bond Counsel in the amount approved. Invoices should be sent to: Cyndy Knighton, Senior Transportation Engineer, City of Tukwila, 6300 Southcenter Blvd., Suite 100, Tukwila, WA 98188. C. Payment is provided in this section shall be full compensation for work performed and for all materials, supplies, equipment and incidentals necessary to complete the 51006939.3 27 work, except that Bond Counsel shall be reimbursed for photocopying (not more than .10 /page), travel expenses, long distance telephone charges, and courier services. D. Bond Counsel's records and accounts pertaining to this Agreement are to be kept available for inspection by representatives of the City and state for a period of three years after final payments. Copies shall be made available upon request. 5. Ownership and Use of Documents. All documents, and other materials produced by Bond Counsel in connection with the services rendered under this Agreement shall be the joint property of the City and Bond Counsel. Bond Counsel shall be permitted to retain copies, including reproducible copies, of all documents for information, reference and use in connection with Bond Counsel's endeavors. Bond Counsel shall not be responsible or liable for any use of the said documents, or other materials by the City on any project or financing other than the project and financing specified in this Agreement. 6. Compliance with Laws. Bond Counsel shall, in performing the services contemplated by this Agreement, faithfully observe and comply with all federal, state, and local laws, ordinances and regulations, applicable to the services to be rendered under this Agreement. 7. Conflicts of Interest. Bond Counsel represents many political subdivisions, companies and individuals in numerous business, real estate, securities and financing transactions, some of which may involve the City. Bond Counsel does not foresee that any such representation will adversely affect its ability to represent the City as provided in this Agreement, because the potential for such adversity is remote or minor and outweighed by the consideration that it is unlikely that advice given to the other client will be relevant to any aspect of the work undertaken as a result of this Agreement. However, during the terms of this engagement Bond Counsel shall not represent any adverse parties against the City without the City's prior written approval. By retaining Bond Counsel as its counsel on this transaction, the City recognizes that firm's representation of any adverse clients for whom waivers have previously been granted by the City. The City also approves Bond Counsel's representation, in matters unrelated to the Bonds or the City, of any bond underwriter that ultimately may purchase the City's LID bonds. 8. Indemnification. Bond Counsel shall indemnify the City, its officers, agents and employees, from and against any and all claims, losses or liability, including attorney's fees, arising from injury or death to persons or damage to property occasioned by any negligent act, omission or failure of Bond Counsel, its officers, agents and employees, in performing the work required by this Agreement. With respect to the performance of this Agreement and as to claims against the City, its officers, agents and employees, Bond Counsel expressly waives its immunity under Title 51 of the Revised Code of Washington, the Industrial Insurance Act, for injuries to its employees, and agrees that the obligation to indemnify, provided for in this paragraph extends to any claim brought by or on behalf of any employee of Bond Counsel. This waiver is mutually negotiated by the parties. This paragraph shall not apply to any damage resulting from the sole negligence -2- 510069393 W of the City, its agents and employees. To the extent any of the damages referenced by this paragraph were caused by or resulted from the concurrent negligence of the City, its agents or employees, this obligation to indemnify is valid and enforceable only to the extent of the negligence of Bond Counsel, its officers, agents and employees. 9. Insurance. Bond Counsel shall secure and maintain in force throughout the duration of this contract comprehensive general liability insurance, with a minimum coverage of $500,000 per occurrence and $1,000,000 aggregate for personal injury; and $500,000 per occurrence/ aggregate for property damage, and professional liability insurance in the amount of $1,000,000 per occurrence and annual aggregrate. 10. Independent Contractor. Bond Counsel and the City agree that Bond Counsel is an independent contractor with respect to the services provided pursuant to this Agreement. Nothing in this Agreement shall be considered to create the relationship of employer and employee between the parties hereto. Neither Bond Counsel nor any employee of Bond Counsel shall be entitled to any benefits accorded City employees by virtue of the services provided under this Agreement. The City shall not be responsible for withholding or otherwise deducting federal income tax or social security or for contributing to the state industrial insurance program, otherwise assuming the duties of an employer with respect to Bond Counsel, or any employee of Bond Counsel. 11. Covenant Against Kickbacks. Bond Counsel warrants that they have not employed or retained any company or person, other than a bonafide employee working solely for Bond Counsel, to solicit or secure this contract, and that they have not paid or agreed to pay any company or person, other than a bonafide employee working solely for Bond Counsel, any fee, commission, percentage, brokerage fee, gifts, or any other consideration contingent upon or resulting from the award or making of this contract. For breach or violation of this warrant, the City shall have the right to annul this contract without liability, or in its discretion to deduct from the contract price or consideration, or otherwise recover, the full amount of such fee, commission, percentage, brokerage fee, gift, or contingent fee. 12. Discrimination Prohibited. Bond Counsel, with regard to the work performed by it under this Agreement, will not discriminate on the grounds of race, color, national origin, religion, creed, age, sex or the presence of any physical or sensory handicap in the selection and retention of employees or procurement of materials or supplies. 13. Assignment. Bond Counsel shall not sublet or assign any of the services covered by this Agreement without the express written consent of the City. 14. Non Waiver. Waiver by the City of any provision of this Agreement or any time limitation provided for in this Agreement shall not constitute a waiver of any other provision. -3- 51006939 3 c e 15. 'Termination. A. The City reserves the right to terminate this Agreement at any time by giving ten days written notice to Bond Counsel. Bond Counsel may terminate this Agreement by giving 30 days written notice to the City, subject to the Rules of Professional Conduct governing attorneys. B. In the event of the death of a member, partner or officer of Bond Counsel, or any of its supervisory personnel assigned to the project, the surviving members of Bond Counsel hereby agree to complete the work under the terms of this Agreement, if requested to do so by the City. This section shall not be a bar to renegotiations of this Agreement between surviving members of Bond Counsel and the City, if the City so chooses. 16. Notices. Notices to the City of Tukwila shall be sent to the following address: City Clerk City of Tukwila 6200 Southcenter Boulevard Tukwila, WA 98188 Notices to Bond Counsel shall be sent to the following address: Hugh D. Spitzer Foster Pepper PLLC 1111 Third Avenue, Suite 3400 Seattle, WA 98101 IT Integrated Agreement. This Agreement, together with attachments or addenda, represents the entire and integrated Agreement between the City and Bond Counsel and supersedes all prior negotiations, representations, or agreements written or oral regarding Bond Counsel's services with respect to the LID. This Agreement may be amended only by written instrument signed by both the City and Bond Counsel. DATED the later execution date by each of the parties to this Agreement. CITY OF TUKWILA C#1 H erton, M Attest/Au enticated: ..lei x Christy O' Flaherty City Clerk 1-1 51006939.3 -4- BOND COUNSEL a� -A Hugh D' Spitzer, Member` Approved as to Form: O ice th ity ttorney 0111 10.14:1.1 j.M SCOPE OF BOND COUNSEL SERVICES FOSTER PEPPER PLLC In the following, we use the term "bonds" to include any obligation of the City for which we are asked to serve as bond counsel. A. BOND COUNSEL SERVICES Those services which Foster Pepper PLLC traditionally provides as bond counsel to the City include. (1) Advising the City and its consultants on the legal requirements applicable to and, when requested, participating with those consultants and City staff in planning, the financing of a project, including advice on state law and federal income tax and securities laws; (2) Reviewing the transcripts relating to the prior issuance by the City of related outstanding obligations (typically revenue obligations), to assure conformity of the bonds with applicable covenants and conditions; (3) Based on facts provided by the City, performing the necessary legal analysis to determine, in financings in which the bonds are intended to be tax exempt, whether interest on the bonds will qualify for an exclusion from gross income for federal income tax purposes, and preparing tax exemption and nonarbitrage certificates; (4) Drafting the ordinances /resolutions and other documents necessary to authorize the bonds to be sold and issued (including, where applicable, ballot title ordinances /resolutions); (5) Attending certain meetings relating to the sale and issuance of the bonds; (6) Forwarding City financing documents to bond rating agencies and/or bond insurers, when requested by the City or the City's financial consultant or underwriter, and explaining those documents to agency and insurer representatives; (7) When requested by the City or the City's financial consultant or underwriter, reading those portions of drafts of the official statement, offering circular or other sales material relating to the bonds prepared by the City's investment bankers necessary to assure the accuracy only of the 'description of the bonds, the source of payment and security for the bonds, any continuing disclosure undertaking and the federal tax treatment of the interest on the bonds; (8) Preparing closing documents necessary to support the issuance of the bonds and assembling the transcript after the closing; and (9) Subject to the completion of proceedings to our satisfaction, furnishing the firm's approving legal opinion for the bonds regarding the validity and binding effect of the bonds and the excludability of interest on the bonds from gross income for federal income tax purposes. Exhibit A 1 510069393 31 Bond Counsel's bond opinion will be based on facts and law existing as of its date, and will constitute the expression of our professional judgment on the matters expressly addressed and not a guarantee of result. In rendering that opinion, Bond Counsel will rely upon the certified proceedings and other certifications of public officials and other persons furnished to us without undertaking to verify the same by independent investigation, and we will assume the City's continuing compliance, after the issue date, with applicable laws relating to the bonds. During the course of this engagement, we will rely on the City to provide us with complete and timely information on all developments pertaining to any aspect of the bonds and their security, as well as the expected use of bond proceeds. Bond Counsel understand and expect that officers and employees of the City will cooperate in this regard. B. OTHER SERVICES Traditional bond counsel services described above do not include the following additional bond and project- related work for the City which we would be pleased to perform on request, working with the City's attorney or other designated representatives. The provision of these services involves separate fee arrangements and compensation at the hourly rates set forth in Exhibit B. (1) The drafting or review for sufficiency of any environmental impact statements or other evidence of compliance with the State and National Environmental Policy Acts, the Shorelines Management Act, Growth Management Act and similar laws; (2) The drafting or review for accuracy of portions of any official statement, offering circular or other sales material relating to the issuance of the bonds prepared by the City or its underwriter or otherwise used in connection with such bonds, other than the review of those portions of the official statement describing the bonds, the source of payment and security for the bonds, any continuing disclosure undertaking and the expected federal tax treatment of the interest on the bonds is included in our services as bond counsel (See item A.7 above); (3) Giving advice to the City's consultants regarding the applicability of the registration requirements under federal or state securities laws or regarding federal and state securities disclosure requirements or due diligence review; (4) Drafting or negotiating of bond purchase agreements (though as a matter of course as bond counsel we typically review such agreements to assure that they conform to the City's bond authorization documents); (5) Negotiation and drafting of repurchase agreements, investment contracts, custodial agreements, swap agreements, credit enhancement or liquidity facilities (other than bond insurance), and contracts (including contracts with developers or owners of property included within local improvement districts formed by the City), or disputes or litigation in connection therewith; (6) Attending rating agency or public information meetings in connection with the issuance of bonds; Exhibit A 2 51006939.3 32 (7) Preparation of supplemental opinions required of bond counsel by the City or the underwriter of bonds in connection with their issuance; (8) The drafting or obtaining of state or federal legislation; (9) Participating in administrative proceedings, trial or appellate litigation; (10) Drafting special assessment district formation and assessment documents and attending special assessment hearings (see Exhibit B); (11) Work in connection with seeking or obtaining governmental assistance or approvals from governmental agencies other than the City, necessary for carrying out the purposes of the bond issue; (12) Providing services relating to public works bidding, negotiating design or construction contracts, or carrying out the acquisition of property or the construction of projects; (13) Representing the City in Internal Revenue Service examinations or inquiries, or Securities and Exchange Commission investigations; (14) After closing, providing continuing advice to the City or any other parry concerning any actions necessary to assure that interest paid on the bonds will continue to be excludable from gross income for federal income tax purposes (e.g., our engagement as bond counsel does not include rebate calculations for the bonds, dealing with changes of use or delays in the expenditure of proceeds); (15) Assisting the City with its continuing disclosure obligations consistent with applicable securities laws; or (16) Addressing any other matter not specifically set forth above that is not required to furnish our bond opinion. C. FILE MANAGEMENT After the transaction is concluded, Bond Counsel will deliver to the City a complete copy of the transcript of the transaction. A transcript is delivered generally within 30 to 60 days after closing. We then close our files regarding the matter, and Bond Counsel's representation on the transaction is completed. Additional services after closing would be addressed under Part B, above. Exhibit A 3 51006939.3 33 EXHIBIT B SPECIAL COUNSEL SERVICES 1. Prepare LID formation documents, including notices, resolution of intention and formation ordinance, or review such documents prepared by the office of the City Attorney. 2. Prepare assessment roll confirmation documents, including notices and confirmation ordinance, or review such documents prepared by the office of the City Attorney. 3. Prepare form of notice for collection, or review such notice as prepared by the office of the City Attorney. 4. Attend meetings with staff and consultants as requested by City. 5. Attend and advise the City at the formation hearing, if requested by the City. 6. Attend and represent the LID or the City Council in assessment roll confirmation hearings, if requested by the City. 7. Perform such other tasks as the City may reasonably request in connection with the formation of the LID, confirmation of the assessment roll and preparation of notices for collection. Exhibit B 5 1006939 3 34 EXHIBIT C 1. Bond Counsel fees for LID revenue bonds shall be calculated according to the following schedule: Issue Size Revenue Bonds $100,000 or less $4,800 $100,000 $999,999 $4,800 3.60 per $1,000 in excess of $100,000 1M $4.999 M $8,040 2.40 per $1,000 in excess of $1 million 5M $9.999 M $17,640 1.20 per $1000 in excess of $5 million 10M $20M $23,640 +.60 per $1,000 in excess of $10 million Over $20M Negotiable SPECIAL RULES: Bond Anticipation Notes: 0.65 times the bond fee, then 1/2 the bond fee on each rollover. 2. Fees for Special Counsel Services will be charged each attorney's standard hourly rate then in effect, minus a 10% discount. The following reduced rates are currently in effect: Hugh D. Spitzer $420.00 P. Stephen DiJulio 375.00 Other Members "Partners 375.00 (est.) Associates 260.00 (est.) Exhibit C 510069393 35 Rim Finance Safety Committee Minutes Auoust 21, 2012 Paae 2 C. Lease Agreement: Xerox Corporation for Copiers Staff is seeking Council approval to enter into lease agreements with the Xerox Corporation of the next two years for a total of 19 copiers in an amount to exceed $210,000. Six copiers will be leased immediately, and the remaining copiers will be leased over a two -year period as current copy machines require replacement. Cost savings over a five -year period are estimated to be $9,667. Staff will make a small adjustment to the wording in the Recommendation to reflect the exact number of copiers being leased. UNANIMOUS APPROVAL. FORWARD TO SEPTEMBER 4 CONSENT AGENDA. D. Contract Amendment: Bond Counsel LID #33 Staff is seeking Council approval to enter into a contract amendment with Foster Pepper PLLC in the amount of $25,000 for litigation services, as required, in regard to contested assessments by Local Improvement District (LID) #33 property owners. This amendment will take the current contract past the $40,000 Council approval threshold, and therefore, staff is seeking Council approval. The Committee asked staff to confirm where the funds for this amendment are taken. UNANIMOUS APPROVAL. FORWARD TO SEPTEMBER 4 CONSENT AGENDA. E. 2012 Market Studv for Non Represented Emplovees As information only, staff notified the Committee of the positions that will be reviewed for a market study comparison per Resolution No. 1769. These positions fell in the 5% range after application of the 2012 wage adjustment. INFORMATION ONLY. III. MISCELLANEOUS Meeting adjourned at 6:33 p.m. Next meeting: Wednesday,* September 5, 2012 5:15 p.m. Conference Room #3 *Wednesday due to HOLIDAY Committee Chair Approval Minutes by KAM. 37