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2021 Oct 5 - CC PACKET1 AGENDA EL SEGUNDO CITY COUNCIL REGULAR MEETING TUESDAY, OCTOBER 5, 2021 4:00 PM CLOSED SESSION 6:00 PM OPEN SESSION CITY COUNCIL CHAMBER 350 MAIN STREET, EL SEGUNDO, CA 90245 MEETING ID: 964 5963 7962 PIN: 730770 PUBLIC ADVISORY: THE CITY COUNCIL CHAMBER AND/OR LOBBY WILL ONLY BE OPEN TO THE PUBLIC FOR PUBLIC COMMUNICATIONS. (Face masks/coverings are required to be worn inside City facilities) Drew Boyles, Mayor Chris Pimentel, Mayor Pro Tem Carol Pirsztuk, Councilmember Scot Nicol, Councilmember Lance Giroux, Councilmember Tracy Weaver, City Clerk Matthew Robinson, City Treasurer Executive Team Scott Mitnick, City Manager Barbara Voss, Deputy City Manager Jaime Bermudez, Interim Police Chief Michael Allen, Dev. Services Director Elias Sassoon, Public Works Director Melissa McCollum, Comm. Services Director Mark Hensley, City Attorney Joe Lillio, Chief Financial Officer Deena Lee, Acting Fire Chief Rebecca Redyk, HR Director Charles Mallory, Info. Tech. Director MISSION STATEMENT: “Provide a great place to live, work, and visit.” VISION STATEMENT: “A hub for innovation where big ideas take off.” Page 1 of 80 2 How Can Members of the Public Observe and Provide Public Comments? Residents can watch the meeting live via Spectrum Channel 3, AT&T U-Verse Channel 99 and/or El Segundo TV at YouTube.com. Access remotely via Zoom from a PC, Mac, iPad, iPhone, or Android device or by phone. Use URL https://zoom.us/j/96459637962 and enter PIN: 730770 or visit www.zoom.us on device of choice, click on “Join a Meeting” and enter meeting ID and PIN. Join by phone at 1-669-900-9128 and enter meeting ID and PIN. Your phone number is captured by the Zoom software and is subject to the Public Records Act. Dial *67 BEFORE dialing in to remain anonymous. For Public Communications, members of the public may provide comments in the Lobby and/or Council Chamber or via Zoom. For in person comments, please fill out a Speaker Card located in the Chamber Lobby and for Zoom comments, notify meeting host by raising your virtual hand (see hand icon at bottom of screen) and you will be invited to speak. (If you do not wish for your name to appear on the screen, then use the drop-down menu and click on “rename” to rename yourself “anonymous”) Please note that you will be placed in a “listen only” mode and your video feed will not be shared with City Council or members of the public. For written communication, submit to ALLELECTEDOFFICIALS@elsegundo.org by 3:00 PM to be uploaded to the Website. Emails received after 3:00 PM will be posted the next day. For Public Hearings, public communication will be via zoom only. Speaker cards and attendee’s information captured by Zoom software will be considered public documents subject to possible posting on the City’s Website and are subject to disclosure under the Public Records Act. Additional Information: The City Council, with certain statutory exceptions, can only take action upon properly posted and listed agenda items. Any writings or documents given to a majority of City Council regarding any matter on this agenda that the City received after issuing the agenda packet are available for public inspection in the City Clerk’s Office during normal business hours. Such documents may also be posted on the City’s website at www.elsegundo.org and additional copies will be available at the City Council meeting. Unless otherwise noted in the agenda, the public can only comment on City-related business that is within the jurisdiction of the City Council and/or items listed on the agenda during the Public Communications portions of the Meeting. Additionally, members of the public can comment on any Public Hearing item on the agenda during the Public Hearing portion of such item. The time limit for comments is five (5) minutes per person. Before speaking to the City Council, please state: your name, residence, and organization/group you represent, if desired. Please respect the time limits. Page 2 of 80 3 In compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please contact the City Clerk’s Office at 310-524-2305. Notification 48 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility to this meeting. 4:00 PM CLOSED SESSION – CALL TO ORDER / ROLL CALL PUBLIC COMMUNICATION – (RELATED TO CITY BUSINESS ONLY – 5-MINUTE LIMIT PER PERSON, 30-MINUTE LIMIT TOTAL) Individuals who have received value of $50 or more to communicate to the City Council on behalf of another, and employees speaking on behalf of their employer, must so identify themselves prior to addressing City Council. Failure to do so shall be a misdemeanor and punishable by a fine of $250. While all comments are welcome, the Brown Act does not allow City Council to take action on any item not on the agenda. City Council and/or City Manager will respond to comments after Public Communications is closed. SPECIAL ORDERS OF BUSINESS RECESS INTO CLOSED SESSION: City Council may move into a closed session pursuant to applicable law, including the Brown Act (Government Code Section §54960, et seq.) for purposes of conferring with City’s Real Property Negotiator; and/or conferring with City Attorney on potential and/or existing litigation; and/or discussing matters covered under Government Code Section §54957 (Personnel); and/or conferring with City’s Labor Negotiators. CONFERENCE WITH LEGAL COUNSEL – EXISTING LITIGATION (GOV’T CODE §54956.9(D)(1): -0- MATTERS James Stephens v. City of El Segundo, Workers Compensation Appeals Board, Case No. ADJ11934528 CONFERENCE WITH CITY’S LABOR NEGOTIATOR (Gov’t Code §54957.6): -1- matters City’s Representative: Mark Hensley, City Attorney Unrepresented Employee: Scott Mitnick, City Manager 6:00 PM – CONVENE OPEN SESSION – CALL TO ORDER / ROLL CALL INVOCATION – Pastor Seth McKenna, The Bridge PLEDGE OF ALLEGIANCE – Councilmember Pirsztuk SPECIAL PRESENTATIONS 1.Supervisor Hahn Recognition Page 3 of 80 4 PUBLIC COMMUNICATIONS – (RELATED TO CITY BUSINESS ONLY – 5 MINUTE LIMIT PER PERSON, 30 MINUTE LIMIT TOTAL) Individuals who have received value of $50 or more to communicate to the City Council on behalf of another, and employees speaking on behalf of their employer, must so identify themselves prior to addressing the City Council. Failure to do so shall be a misdemeanor and punishable by a fine of $250. While all comments are welcome, the Brown Act does not allow Council to take action on any item not on the agenda. The Council will respond to comments after Public Communications is closed. CITY MANAGER FOLLOW-UP COMMENTS – (Related to Public Communications) A.PROCEDURAL MOTIONS Read all ordinances and resolutions on the Agenda by title only. Recommendation - Approval B.CONSENT 2. City Council Meeting Minutes Recommendation – Approve Regular City Council Meeting Minutes of September 21, 2021. 3. Warrant Demand Register for September 12, 2021 through September 23, 2021 Recommendation - 1. Ratify payroll and employee benefit checks; checks released early due to contracts or agreements; emergency disbursements and/or adjustments; and, wire transfers. 2. Approve Warrant Demand Register numbers 6A and 6B: warrant numbers 3037306 through 3037537, and 9002197 through 9002199. 4. Agreement with National Utility Locators, LLC for Utility Locating and Marking Services Project Recommendation – Authorize the City Manager to execute a Standard Public Works Contract with National Utility Locators, LLC in the amount of $76,800 for the Utility Locating and Marking Services Project, Project No. PW 20-09. 5. Extension of License Agreement with El Segundo Nursery School Group Recommendation – Authorize the City Manager to extend the License Agreement with El Segundo Nursery School Group for nine months. Page 4 of 80 5 6. Amendment to Memorandum of Understanding between the City of El Segundo and El Segundo Unified School District for Library Services Recommendation – Approve Amendment to Memorandum of Understanding between the CIty of El Segundo and El Segundo Unified School District for Library Services 7. Resolution to Conduct Public Meetings via Teleconferencing Pursuant to Assembly Bill No. 361 Recommendation – Adopt a Resolution allowing public meetings to continue to be conducted via teleconferencing pursuant to Assembly Bill No. 361 and directing City Committees, Commissions, and Boards to take certain associated actions. C.PUBLIC HEARINGS D.STAFF PRESENTATIONS 8. Affordable Housing Services Provider Professional Services Agreement Recommendation – Approve a Professional Services Agreement with Many Mansions, a California non-profit, to provide affordable housing services. 9. El Segundo Dial-A-Ride Program Update Recommendation – Receive and file. 10. Covid-19 Update and Ratify City Manager’s Amendment to Administrative Order No. 1 Dated September 29, 2021 Recommendation - 1. Receive and file COVID-19 Update. 2. Ratify Amendment to Administrative Order No. 1 addressing extended temporary encroachment permits for restaurants and retail food facilities conducting outdoor dining service within the public right-of-way. 11. FY 2020-2021 Year-End Financial Report Recommendation – Receive and file the unaudited FY 2020-2021 Year-End Financial Report E.COMMITTEES, COMMISSIONS AND BOARDS PRESENTATIONS F.REPORTS - CITY CLERK G.REPORTS - CITY TREASURER Page 5 of 80 6 H.REPORTS - COUNCIL MEMBERS 12. League of California Cities Annual Conference Report - September 22-24, 2021 Recommendation – Receive and file report. COUNCILMEMBER GIROUX COUNCILMEMBER NICOL COUNCILMEMBER PRISZTUK MAYOR PRO TEM PIMENTEL MAYOR BOYLES I.REPORTS - CITY ATTORNEY J.REPORTS/FOLLOW-UP - CITY MANAGER CLOSED SESSION The City Council may move into a closed session pursuant to applicable law, including the Brown Act (Government Code Section §54960, et seq.) for the purposes of conferring with the City’s Real Property Negotiator; and/or conferring with the City Attorney on potential and/or existing litigation; and/or discussing matters covered under Government Code Section §54957 (Personnel); and/or conferring with the City’s Labor Negotiators. REPORT OF ACTION TAKEN IN CLOSED SESSION (if required) MEMORIALS ADJOURNMENT POSTED: DATE: September 30, 2021 TIME: 1:15 PM BY: Tracy Weaver, City Clerk Page 6 of 80 EL SEGUNDO CITY COUNCIL MEETING MINUTES SEPTEMBER 21, 2021 PAGE 1 MEETING MINUTES OF THE EL SEGUNDO CITY COUNCIL TUESDAY, SEPTEMBER 21, 2021 CLOSED SESSION – Mayor Boyles called to order at 4:02 PM ROLL CALL Mayor Boyles - Present Mayor Pro Tem Pimentel - Present Council Member Pirsztuk - Present Council Member Nicol - Present Council Member Giroux - Present PUBLIC COMMUNICATION – (Related to City Business Only – 5-minute limit per person, 30-minute limit total) None. SPECIAL ORDER OF BUSINESS: Mayor Boyles announced that Council would be meeting in closed session pursuant to the items listed on the Agenda. CLOSED SESSION: City Council may move into a closed session pursuant to applicable law, including the Brown Act (Government Code Section §54960, et seq.) for purposes of conferring with City’s Real Property Negotiator; and/or conferring with City Attorney on potential and/or existing litigation; and/or discussing matters covered under Government Code Section §54957 (Personnel); and/or conferring with City’s Labor Negotiators as follows: DISCUSSION OF PERSONNEL MATTERS (GOV’T CODE §54957): -2- MATTERS City Manager and City Attorney Performance Reviews Mayor Boyles recessed Closed Session at 5:59 PM OPEN SESSION – Mayor Boyles called to order at 6:05 PM ROLL CALL Mayor Boyles - Present Mayor Pro Tem Pimentel - Present Council Member Pirsztuk - Present Council Member Nicol - Present Council Member Giroux - Present INVOCATION – Tracy Weaver, City Clerk Page 7 of 80 EL SEGUNDO CITY COUNCIL MEETING MINUTES SEPTEMBER 21, 2021 PAGE 2 PLEDGE OF ALLEGIANCE – Mayor Pro Tem Pimentel SPECIAL PRESENTATIONS: 1. Commendation read by Council Member Nicol and presented to the El Segundo Little League State Champions. 2. Bernice Coveleski 100th Birthday was honored with a video with Council Member Pirsztuk reading a Commendation to Ms. Coveleski. 3. Hispanic Heritage Month Proclamation read by Council Member Giroux, presented to Jaime Bermudez, Interim Police Chief. 4. COVID-19 Update given by Acting Fire Chief, Deena Lee. 5. Hyperion and AQMD Update reported by Elias Sassoon, Public Works Director and Tim Dafeta, LASAN (Los Angeles Sanitation) Hyperion General Manager. PUBLIC COMMUNICATIONS – (Related to City Business Only – 5-minute limit per person, 30-minute limit total) In Chamber Dallin Young, Blue Water Government Affairs President, a cannabis consulting firm, stated the company would like to work with the City on a ballot initiative and/or ordinance as an alternative to the ballot initiative currently circulating. Luis Bobadilla, MOTA Inc. President and owner of a licensed cannabis business, works with Blue Water and offered an alternative to the ballot initiative currently circulating. Via Zoom – None this evening CITY MANAGER FOLLOW-UP COMMENTS: Mr. Mitnick stated he would follow up with the two individuals who commented. A. Read all Ordinances and Resolutions on the Agenda by Title Only. MOTION by Council Member Giroux, SECONDED by Mayor Pro Tem Pimentel to read all ordinances and resolutions on the agenda by title only. MOTION PASSED BY UNANIMOUS VOICE VOTE. 5/0 B. CONSENT: 6. Approve Regular City Council Minutes of September 7, 2021. (Fiscal Impact: None) 7. Approve Warrants Demand Register for August 13, 2021 through September 10, 2021, numbers 4B and 5A and 5B and warrant numbers 3037044 through 3037305, and 9002159 through 9002196. Ratify Payroll and employee benefit Checks; Checks released early due to contracts or agreement; Emergency disbursements and/or adjustments; and, Wire transfers. (Fiscal Impact:) Page 8 of 80 EL SEGUNDO CITY COUNCIL MEETING MINUTES SEPTEMBER 21, 2021 PAGE 3 8. Notice of Completion of Roller Hockey Rink Improvements Project. Project No. PW 19-13. (Fiscal Impact: $) MOTION by Council Member Giroux, SECONDED by Mayor Pro Tem Pimentel, approving Consent Agenda items 6, 7, and 8. MOTION PASSED BY UNANIMOUS VOICE VOTE. 5/0 C. PUBLIC HEARING: None D. STAFF PRESENTATIONS: 9. Purchase of Retried Police Canine by Handler, Sergeant Alex Leavitt. (Fiscal lmpact: $1.00) Jaime Bermudez, Interim Police Chief and Sergeant Levitt with Roxy in attendance to receive her “retirement” gift and accolades. Council discussion MOTION by Mayor Pro Tem Pimentel, SECONDED by Council Member Pirsztuk authorizing the Chief of Police to sign Agreement No. 6165 for the sale of retired police canine, “Roxy," to his handler, Sergeant Alex Leavitt, for the nominal fee of one dollar ($1.00). MOTION PASSED BY VOICE VOTE. 5/0 E. COMMITTEES, COMMISSIONS AND BOARDS PRESENTATIONS: None F. REPORTS – CITY CLERK – No report G. REPORTS – CITY TREASURER – 10. Investment Portfolio Report for June 2021 (Fiscal Impact: None) Matthew Robinson, City Treasurer gave a presentation Council Discussion Council consensus to receive and file presentation. H. REPORTS – COUNCIL MEMBERS Council Member Giroux – Shout out Happy Birthday to Michael Alcala. Council Member Nicol – Reminded residents of the El Segundo Hyperion Forum via Zoom on Thursday, September 24th at 6:00 PM. Please see the City’s website for information on how to sign up and participate in the meeting. Page 9 of 80 EL SEGUNDO CITY COUNCIL MEETING MINUTES SEPTEMBER 21, 2021 PAGE 4 Council Member Pirsztuk – Thanked the Fire Department for hosting the Pancake Breakfast on September 11th and honoring the fallen heroes on this day. Mayor Pro Tem Pimentel – Asked residents to check out the local travel network, it is an effort to tie in the South Bay Cities with alternative means of travel. The network in looking for ways to tie in El Segundo, since we have industrial sites and Chevron between us and the other cities. Thanked the County Sanitation District for volunteering their time and effort in helping clean up after the Hyperion sewage spill. Mayor Boyles – Congratulated the ED! Foundation on a successful ED!toberfest event, mentioned South Bay Cities Council of Governments Board meeting is Thursday, September 24, 2021 and mentioned a couple Council Members will be attending the League of Cities conference this week in Sacramento. I. REPORTS – CITY ATTORNEY – No report J. REPORTS/FOLLOW-UP – CITY MANAGER – Stated he will be attending the League of Cities Conference in Sacramento and stated the next City Council meeting will be held Tuesday, October 5, 2021. MEMORIALS – None Open Session adjourned at 7:25 PM Reconvened into Closed Session at 7:30 PM Closed Session Adjourned at 8:37 PM ______________________________ Tracy Weaver, City Clerk Page 10 of 80 City Council Agenda Statement Meeting Date: October 5, 2021 Agenda Heading: Consent Item Number: B.3 TITLE: Warrant Demand Register for September 12, 2021 through September 23, 2021 RECOMMENDATION: 1. Ratify payroll and employee benefit checks; checks released early due to contracts or agreements; emergency disbursements and/or adjustments; and, wire transfers. 2. Approve Warrant Demand Register numbers 6A and 6B: warrant numbers 3037306 through 3037537, and 9002197 through 9002199. FISCAL IMPACT: The warrants presented were drawn in payment of demands included within the FY 2021-2022 Adopted Budget. The total of $2,859,453.36 ($1,842,503.80 in check warrants and $1,016,949.56 in wire warrants) are for demands drawn on the FY 2021- 2022 Budget. BACKGROUND: California Government Code Section 37208 provides General Law cities flexibility in how budgeted warrants, demands, and payroll are audited and ratified by their legislative body. Pursuant to Section 37208 of the California Government Code, warrants drawn in payments of demands are certified by the City's Chief Financial Officer and City Manager as conforming to the authorized expenditures set forth in the City Council adopted budget need not be audited by the City Council prior to payment, but may be presented to the City Council at the first meeting after delivery. In government finance, a warrant is a written order to pay that instructs a federal, state, county, or city government treasurer to pay the warrant holder on demand or after a specific date. Such warrants look like checks and clear through the banking system like checks. Warrants are issued for payroll to individual employees, accounts payable to vendors, to local governments, and to companies or individual taxpayers receiving a refund. Page 11 of 80 Warrant Demand Register October 5, 2021 Page 2 of 2 DISCUSSION: The attached Warrants Listing delineates the warrants that have been paid for the period identified above. The Chief Financial Officer certifies that the listed warrants were drawn in payment of demands conforming to the adopted budget and that these demands are being presented to the City Council at its first meeting after the delivery of the warrants. CITY STRATEGIC PLAN COMPLIANCE: Goal 5: Champion Economic Development and Fiscal Sustainability Objective 5B: El Segundo approaches its work in a financially strategic and responsible way. PREPARED BY: Joseph Lillio, Chief Financial Officer REVIEWED BY: Joseph Lillio, Chief Financial Officer APPROVED BY: Barbara Voss, Deputy City Manager ATTACHED SUPPORTING DOCUMENTS: 1.Register 6a_summary 2.Register 6b_summary Page 12 of 80 Page 13 of 80 Page 14 of 80 Page 15 of 80 Page 16 of 80 Page 17 of 80 Page 18 of 80 City Council Agenda Statement Meeting Date: October 5, 2021 Agenda Heading: Consent Item Number: B.4 TITLE: Agreement with National Utility Locators, LLC for Utility Locating and Marking Services Project RECOMMENDATION: Authorize the City Manager to execute a Standard Public Works Contract with National Utility Locators, LLC in the amount of $76,800 for the Utility Locating and Marking Services Project, Project No. PW 20-09. FISCAL IMPACT: Amount Budgeted: $78,000 Additional Appropriation: No Account Numbers: 501-400-7102-6206, 502-400-4301-6206, and 106-400-4202-6214 BACKGROUND: California Government Code 4216 requires that all contractors contact the Underground Service Alert (USA) notification center prior to any construction activities within and/or around public right-of-ways and easements. The Code also requires public agencies and utility entities that own, operate, and maintain any buried underground utility infrastructure to locate and mark these utilities on the ground surface when requested by USA so that the excavation can be performed with the knowledge of the existing utility in the area. The new code which was enacted in July 2020 requires mandatory reporting by utilizing the Electronic Positive Response (EPR) system through the USA notification center. The new requirement was initially effective as of January 2021; however, this deadline was extended to January 2022. The City of El Segundo owns, operates, and maintains underground utilities such as water lines, pressured sanitary sewer lines, pressured storm drain pipes, traffic signal cables, and fiber optic lines. Consequently, the City is required to locate and mark these utilities upon request. Under the new requirement, the City will be required to utilize the EPR online system to locate and reply to each request before excavation work begins. Page 19 of 80 Utility Locating and Marking Services Project October 5, 2021 Page 2 of 3 DISCUSSION: On March 2, 2021, City Council adopted the plans and specifications for the Utility Locating and Marking Services Project and authorized staff to advertise for bids. Subsequently, this project was advertised with a bid due date of March 30, 2021; however, the City Clerk did not receive any bids. Staff reached out to the prospective vendors to determine why no bids were submitted and learned that the major reasons were the prevailing wage rate requirements and the extended scope of the project. The scope of the project is marking all water lines, pressured sanitary sewer lines, pressured storm drain pipes, traffic signal cables, and fiber optic lines. The vendors indicated they could not submit a bid that would cover the specified scope and adhere to the prevailing wage rates with an annual budget of $78,000. In accordance with Public Contract Code section 22038 c), if no bids are received through the formal or informal procedure, the project may be performed by the employees of the public agency by force account, or negotiated contract without further complying with this article. Subsequently, staff contacted several nearby cities regarding companies that provide similar services in a satisfactory manner and determined that National Utility Locators, LLC (NUL) was the most qualified vendor to provide the utility marking services. NUL offered to provide utility marking services for the City's fiber optic lines, sanitary sewer lines, and pressured storm drain pipes in the amount of $76,800 for fiscal year 2021-2022. The City water crew will continue marking the water lines while the LA County crew will continue marking the City's traffic signal cables. Staff checked the vendor's references and learned that National Utility Locators, LLC successfully completed similar projects for other public agencies in a satisfactory manner. Staff recommends that City Council approve the recommended actions as noted. With the Council's authorization, utility marking services are anticipated to commence immediately after the contract is in place. CITY STRATEGIC PLAN COMPLIANCE: Goal 1: Enhance Customer Service, Engagement, and Communication; Embrace Diversity, Equity, and Inclusion Objective 1A: El Segundo Provides unparalleled service to internal and external customers. Goal 2: Support Community Safety and Preparedness Objective: El Segundo is a safe and prepared city. Page 20 of 80 Utility Locating and Marking Services Project October 5, 2021 Page 3 of 3 Goal 4: Develop and Maintain Quality Infrastructure and Technology Objective 4B: El Segundo's technology supports effective, efficient, and proactive operations. PREPARED BY: Arianne Bola, Sr. Engineer Associate REVIEWED BY: Elias Sassoon, Public Works Director APPROVED BY: Barbara Voss, Deputy City Manager ATTACHED SUPPORTING DOCUMENTS: 1.Vicinity Map 2.Location Map Page 21 of 80 6,018.7 WGS_1984_Web_Mercator_Auxiliary_Sphere Feet6,018.703,009.33 PW 20-09 Utility Locating and Marking Services Project Vicinity Map DISCLAIMER: The information shown on this map was compiled from different GIS sources. The land base and facility information on this map is for display purposes only and should not be relied upon without independent verification as to its accuracy. The City of El Segundo will not be held responsible for any claims, losses or damages resulting from the use of this map. Page 22 of 80 6,018.7 WGS_1984_Web_Mercator_Auxiliary_Sphere Feet6,018.703,009.33 PW 20-09 Utility Locating and Marking Services Project Location Map DISCLAIMER: The information shown on this map was compiled from different GIS sources. The land base and facility information on this map is for display purposes only and should not be relied upon without independent verification as to its accuracy. The City of El Segundo will not be held responsible for any claims, losses or damages resulting from the use of this map. Page 23 of 80 City Council Agenda Statement Meeting Date: October 5, 2021 Agenda Heading: Consent Item Number: B.5 TITLE: Extension of License Agreement with El Segundo Nursery School Group RECOMMENDATION: Authorize the City Manager to extend the License Agreement with El Segundo Nursery School Group for nine months. FISCAL IMPACT: This agreement will generate $600 in revenue for FY 2021-2022 in account 001-300- 0000-3879 (Reservations Fees). The cost to the City's General Fund associated with a waiver in facility rental fees is estimated at $5,600. There is no budget appropriation required. There are sufficient funds in the FY 2021-2022 Budget. BACKGROUND: The El Segundo Nursery School Group (“Co-op”) has operated a non-profit pre-school in El Segundo since 1947. Since the early 1950s, the school has been located in the Clubhouse Building in Recreation Park. During this time, it has served the community by offering a low-cost program to El Segundo residents utilizing two part-time staff members and parent volunteers to run the program. The pre-school serves up to 24 students per academic year and operates three days per week, Tuesday-Thursday, from 8:30 a.m. – 12:30 p.m., from early September through early June. The City Council approves fee schedules for recreational facilities. Applying the standard meeting room rental rate of $15.50 for a non-profit organization's use of a room this size at the Clubhouse, the cost of the Co-op's approximately 400 hours of use per year is $6,200. Due to the program's low fees and the school's corresponding limited budget, paying the standard rental fee is not feasible, according to the Co-op's director. In October 2014, the City and Co-op entered into a License Agreement for a term of three years that provided a discounted rental rate to the school over the three years as follows: $750 for FY 14/15, $1,500 for FY 15/16, and $3,000 for FY 16/17. However, on June 21, 2016, the Co-op requested a modification to the agreement and the City Council approved a fee of $1.00 for FY 16/17. The Co-op also revealed a plan to design Page 24 of 80 Extension of License Agreement with El Segundo Nursery School Group October 5, 2021 Page 2 of 2 and fund a mural outside the Clubhouse Building. The school requested that this donation be in lieu of rental fees for the FY 17/18 school year. Staff agreed and recommended that an amendment to the agreement be executed from October 1, 2017 - September 30, 2018 at no cost. The City Council approved staff’s recommendation. In 2018, City staff and the Co-op met to discuss and agree upon new terms for FY 18/19. After further discussion, the group agreed to establish a three-year contract for use of the rooms in the Clubhouse Building. Due to staffing, utility, and maintenance costs, City staff felt some cost-recovery was important. Staff recommended an amendment to the agreement with El Segundo Nursery School Group from October 1, 2018 - September 30, 2021 at $600 per year. The City Council approved this recommendation. DISCUSSION: The current agreement expires on September 30, 2021. Staff recommends offering the same terms in an amendment that covers meeting room use at the Clubhouse from October 1, 2021- June 30, 2022 at a cost of $600. The shortened term aligns the agreement to the City's new fiscal year. In addition, City staff plans to review the license agreement between the City of El Segundo and the El Segundo Nursery School Group and meeting room rental rates as part of the Finance Department's upcoming comprehensive fee study in 2022. CITY STRATEGIC PLAN COMPLIANCE: Goal 1: Enhance Customer Service and Engagement Objective A: El Segundo provides unparalleled service to internal and external customers Objective B: El Segundo’s engagement with the community ensures excellence PREPARED BY: Arecia Hester, Recreation Superintendent REVIEWED BY: Melissa McCollum, Community Services Director APPROVED BY: Barbara Voss, Deputy City Manager ATTACHED SUPPORTING DOCUMENTS: None Page 25 of 80 City Council Agenda Statement Meeting Date: October 5, 2021 Agenda Heading: Consent Item Number: B.6 TITLE: Amendment to Memorandum of Understanding between the City of El Segundo and El Segundo Unified School District for Library Services RECOMMENDATION: Approve Amendment to Memorandum of Understanding between the CIty of El Segundo and El Segundo Unified School District for Library Services FISCAL IMPACT: Estimated $127,000 of revenue for FY 2021-2022 in account 001-300-6105-3762 (ESUSD Library Support). The projected cost for providing library services to the El Segundo Unified School District for FY 2021-2022 is $127,000 ($122,000 for salaries and $5000 for new school library books). BACKGROUND: The City of El Segundo has invested considerable resources into the administration and operation of four El Segundo Unified School District school libraries since December 1991 as the City views the branches as important extensions of the public library's services. In October 2007, the City of El Segundo and El Segundo Unified School District entered into a Memorandum of Understanding regarding library services. The term of the agreement was extended in October 2012 and July 2015, and is now set to expire on June 30, 2025. A third amendment was approved in August 2020 to provide reimagined library services during the FY 2020-2021 school year due to the impact of the pandemic on school and library operations. The revised service plan outlined in the amendment reflected a reduction in school library service hours and related costs. Due to the resumption of in-person schooling, the City of El Segundo and El Segundo Unified School District plan to revert to the original terms of the agreement in terms of staffing levels and reimbursement of salaries for part-time employees working in the school libraries. Page 26 of 80 Amendment to Memorandum of Understanding between the City of El Segundo and El Segundo Unified School District for Library Services October 5, 2021 Page 2 of 2 DISCUSSION: The El Segundo Unified School District requested the addition of the following language to the Memorandum of Understanding this year. DISTRICT and CITY shall have the right to terminate this MOU for convenience for any reason without cause upon issuing thirty (30) days written notice to the CITY or DISTRICT at no cost penalty to the DISTRICT or CITY. During this notice period, the Parties shall work in good faith to determine if this MOU can be revised to address basis for termination prior to the termination date. The original Memorandum of Understanding required ninety (90) days advance written notice. CITY STRATEGIC PLAN COMPLIANCE: Goal 1: Enhance Customer Service, Engagement, and Communication; Embrace Diversity, Equity, and Inclusion Objective 1A: El Segundo Provides unparalleled service to internal and external customers. Objective 1 B: El Segundo's engagement with the community ensures excellence. Goal 5: Champion Economic Development and Fiscal Sustainability Objective 5A: El Segundo promotes economic growth and vitality for business and the community. Objective 5B: El Segundo approaches its work in a financially strategic and responsible way. PREPARED BY: Melissa McCollum, Community Services Director REVIEWED BY: Melissa McCollum, Community Services Director APPROVED BY: Barbara Voss, Deputy City Manager ATTACHED SUPPORTING DOCUMENTS: None Page 27 of 80 City Council Agenda Statement Meeting Date: October 5, 2021 Agenda Heading: Consent Item Number: B.7 TITLE: Resolution to Conduct Public Meetings via Teleconferencing Pursuant to Assembly Bill No. 361 RECOMMENDATION: Adopt a Resolution allowing public meetings to continue to be conducted via teleconferencing pursuant to Assembly Bill No. 361 and directing City Committees, Commissions, and Boards to take certain associated actions. FISCAL IMPACT: None BACKGROUND: On March 4, 2020, Governor Gavin Newsom proclaimed a State of Emergency to exist in California due to the threat of the COVID-19 pandemic. Subsequent associated gubernatorial executive orders, among other things, allowed local government bodies subject to the Ralph M. Brown Act (“Brown Act”) to conduct virtual/teleconferencing meetings without needing to comply with teleconferencing requirements set forth in the Brown Act. Specifically, the executive orders suspended requirements that mandated (1) that every location from which a member of a body was participating in a meeting must have a notice of the meeting agenda physically posted at location (24 hours in advance for special meetings, and 72 hours in advance for regular meetings) and that each teleconferencing location be open for public attendance, (2) that a majority of the members of the body must be present in the jurisdiction, and (3) that members of the public must be allowed to attend meetings in person. The applicable Executive Order N- 29-20 is expiring on September 30, 2021. In order to address the expiration of the Governor’s Order regarding teleconferencing, effective September 16, 2021, Assembly Bill No. 361 (“AB 361”) took effect which, among other things, amends certain provisions of the Brown Act governing open meetings to allow teleconferencing, including internet-based video conferencing, in a Page 28 of 80 Conduct Public Meetings via Teleconferencing October 5, 2021 Page 2 of 4 manner similar to previously issued gubernatorial executive orders. DISCUSSION: During a proclaimed state of emergency, AB 361 allows a legislative body, like the City Council, to continue utilizing teleconferencing to conduct public meetings in a manner like they have been conducted during the pandemic under certain circumstances, provided the legislative body makes certain findings. After an initial meeting in which certain findings are made, to continue meeting pursuant to AB 361, the legislative body must declare within 30 days that it has reconsidered the circumstances of the state of emergency and either: (1) the state of emergency continues to directly impact the ability of the members to meet safely in person; or (2) state or local officials continue to impose or recommend measures to promote social distancing. Accordingly, the Council’s action and the issue of teleconferencing will be revisited every 30 days. For the reasons set forth below, staff is recommending that Council, as part of the resolution, direct the commissions, committees, and boards (“CCBs”) to not meet in person and rather, for the short-term, to continue to meet via teleconferencing unless the City Manager determines that a CCB can and should meet in person based upon the then applicable health and safety regulations and the relative importance of a CCB conducting an in-person meeting. Currently, there are a myriad of state and county regulations regarding meetings conducted indoors. The County’s order prohibits such unless certain restrictions are adhered to. Additionally, the City is subject to employer regulations promulgated by CalOSHA that place additional restrictions on workplace interaction. The state and county regulations have changed numerous times during the nineteen- month period that the pandemic has existed. Council meeting protocols have been changed several times during this time based upon the changing legal requirements. The Council is currently conducting a portion of its regular open session meetings in person but with numerous restrictions and limited in-person public and staff participation for purposes of complying with existing legal requirements. While staff understands the importance of coordinating Council meetings to allow maximum public participation, staff believes it would be prudent in the short-term for the CCB’s to continue to meet virtually. It will be a significant burden on staff and the CCB’s to go through continuous changes as to how the CCB meetings will be conducted. However, there may be instances where there is a significant purpose to allow for in- person meetings if the then applicable regulations can be adhered to without significant strain on City resources. For example, there are currently several public hearings that are likely to come before the Planning Commission over the next few months that will be reviewed for potential in-person meetings based upon the above criteria. The City Manager will make decisions regarding whether a particular CCB meeting should and can be reasonably conducted in-person. Page 29 of 80 Conduct Public Meetings via Teleconferencing October 5, 2021 Page 3 of 4 Again, the above issues will be revisited by the Council every 30 days and as the various regulations/restrictions are amended or lifted, all Council and CCB meetings will be conducted in the manner they were conducted before the pandemic. The proposed Resolution would: Make the requisite findings for the City Council to continue using teleconferencing protocols for its public meetings, subject to certain notice, access, and participation requirements Require the City Council, every 30 days, to reconsider the state of emergency conditions and consider whether certain findings can be made to support continued use of teleconferencing procedures; Prohibit all Brown Act-subject City legislative bodies, including applicable commissions, committees, and boards, from meeting exclusively in person except as determined by the City Manager or until the Council provides further direction in the future; and Direct all such Brown Act-subject City legislative bodies, including applicable commissions, committees, and boards, to consider the adoption of a resolution allowing for its conducting public meetings via teleconferencing at any meeting occurring after the date of this Resolution. Approval of the proposed Resolution requires a recorded majority vote of the City Council’s total membership. CITY STRATEGIC PLAN COMPLIANCE: Goal 1: Enhance Customer Service, Engagement, and Communication; Embrace Diversity, Equity, and Inclusion Objective 1A: El Segundo Provides unparalleled service to internal and external customers. Objective 1 B: El Segundo's engagement with the community ensures excellence. PREPARED BY: Mark Hensley, City Attorney REVIEWED BY: Mark Hensley, City Attorney APPROVED BY: Barbara Voss, Deputy City Manager ATTACHED SUPPORTING DOCUMENTS: Page 30 of 80 Conduct Public Meetings via Teleconferencing October 5, 2021 Page 4 of 4 1.Resolution to Continue to Conduct Public Meetings via Teleconferencing - AB361 Page 31 of 80 - 1 - RESOLUTION NO. _____- A RESOLUTION OF THE CITY COUNCIL OF CITY OF EL SEGUNDO FINDING THAT CERTAIN CONDITIONS EXIST TO CONTINUE CONDUCTING PUBLIC MEETINGS VIA TELECONFERENCING PURUSANT TO ASSEMBLY BILL NO. 361 AND DIRECTING CITY COMMITTEES, COMMISSIONS, AND BOARDS TO TAKE CERTAIN ASSOCIATED ACTIONS. The City Council of the city of El Segundo does resolve as follows: SECTION 1: The City Council finds and declares as follows: A. On March 4, 2020, Governor Gavin Newsom proclaimed a State of Emergency to exist in California due to the threat of the COVID-19 pandemic. B. This gubernatorial proclamation, among other things, suspended local government emergency declaration, reporting, and extension requirements of Government Code § 8630 for the duration of the COVID-19 pandemic. C. Effective September 16, 2021, Assembly Bill No. 361 (“AB 361”) took effect which, among other things, amends certain provisions of the Ralph M. Brown Act (“Brown Act”) governing open meetings to allow teleconferencing, including internet-based video conferencing, in a manner similar to previously issued gubernatorial executive orders. D. During a proclaimed state of emergency, AB 361 allows a legislative body, like the City Council, to continue utilizing teleconferencing to conduct public meetings under certain circumstances, provided the legislative body makes certain findings. E. After an initial meeting in which certain findings are made, to continue meeting pursuant to AB 361, the legislative body must declare 30 days that it has reconsidered the circumstances of the state of emergency and either: (1) the state of emergency continues to directly impact the ability of the members to meet safely in person; or (2) state or local officials continue to impose or recommend measures to promote social distancing. SECTION 2: Teleconferencing A. Pursuant to Government Code § 54953(e), the City Council finds as follows: Page 32 of 80 - 2 - 1. The state of California continues to be in a declared state of emergency pursuant to Government Code § 8625 (the California Emergency Services Act; see Government Code § 54953(e)(3); see also Governor’s Proclamation dated March 4, 2020), which ; and 2. Based upon the most recent Order of the Health Officer for County of Los Angeles Department of Public Health (dated September 17, 2021 and effective October 7, 2021), masks and social distancing continue to be necessary to curb the spread of COVID-19 (Government Code § 54953(e)(3)(B)(ii)). B. Accordingly, to protect public health and safety the City Council: 1. finds that it is in the public interest to conduct public meetings of its legislative bodies via teleconference as defined by Government Code § 54953; 2. prohibits all Brown Act-subject City legislative bodies, including applicable commissions, committees, and boards, from meeting exclusively in person, except as determined by the City Manager or until the City Council provides futher direction in the future; and 3. directs all such Brown Act-subject City legislative bodies, including applicable commissions, committees, and boards, to consider the adoption of a resolution allowing for its conduct public meetings via teleconference as defined by Government Code § 54953 at any meeting occuring after the date of this Resolution. C. The City Council will adhere to all requirements of Government Code § 54953 governing teleconferencing during the emergency including, without limitation, posting agendas; allowing for real-time public comment via either call-in or internet-based; allowing for written communications that will be either read or summarized into the record during the meeting as determined by the City Council; and protecting the statutory and constitutional rights of all persons appearing before the legislative body. No physical location will be provided for persons wishing to provide real-time public comment. SECTION 3: Reporting. Every 30 days following adoption of this Resolution, the City Council will reconsider the extension of the teleconferencing method of public meetings in accordance with Government Code § 54953(e)(3). Such determinations may be placed on the consent calendar. Page 33 of 80 - 3 - SECTION 4: Electronic Signatures. This Resolution may be executed with electronic signatures in accordance with Government Code §16.5. Such electronic signatures will be treated in all respects as having the same effect as an original signature. SECTION 5: Recordation. The Mayor, or presiding officer, is authorized to sign this Resolution signifying its adoption by the City Council and the City Clerk, or duly appointed deputy, may attest thereto. SECTION 6: Effective Date. This Resolution will become effective immediately upon adoption and will remain effective unless repealed or superseded. PASSED AND ADOPTED this ___ day of ______________, 2021. ________________________________ Drew Boyles, Mayor STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) SS CITY OF EL SEGUNDO ) I, Tracy Weaver, City Clerk of the City of El Segundo, California, hereby certify that the whole number of members of the City Council of the City is five; that the foregoing Resolution No. _________ was duly passed and adopted by said City Council, approved and signed by the Mayor of said City, and attested to by the City Clerk of said City, all at a regular meeting of said Council held on the _______ day of ________________, 2021, and the same was so passed and adopted by the following roll call vote: AYES: NOES: ABSENT: ABSTAIN: ATTEST: ________________________________ Tracy Weaver, City Clerk APPROVED AS TO FORM: Page 34 of 80 - 4 - ____________________________ Mark D. Hensley, City Attorney Page 35 of 80 City Council Agenda Statement Meeting Date: October 5, 2021 Agenda Heading: Staff Presentations Item Number: D.8 TITLE: Affordable Housing Services Provider Professional Services Agreement RECOMMENDATION: Approve a Professional Services Agreement with Many Mansions, a California non- profit, to provide affordable housing services. FISCAL IMPACT: There will not be any direct fiscal impacts. Many Mansions has agreed to provide in- kind professional consulting services as the City’s affordable housing services provider in exchange for the opportunity to manage and/or develop future City-sponsored affordable housing. Future affordable housing development will be funded by the City's Affordable Housing Fund and outside sources. There is no direct General Fund impact. BACKGROUND: As explained in the attached February 16, 2021 staff report, in 2016 City Council approved a residential development (24 single-family units and 34 multi-family units) at the former Imperial Street School site located at 540 East Imperial Avenue. Subsequent to this approval, there were several meetings to discuss the number of multi-family units that might be dedicated as "affordable units." On March 17, 2020, City Council amended the Project's Specific Plan to allow the developer (DR Horton) to pay a $5.3 million "in-lieu" fee to the City in place of dedicating and/or producing future affordable housing units. Prior to spending any of the $5.3 million, the City established an Affordable Housing Fund and the money has remained intact. To assist in the production of affordable housing units in compliance with the City's Regional Housing Needs Assessment (RHNA) requirements, staff is developing an Inclusionary Housing Ordinance which will obligate future housing developments to include affordable housing units and/or pay similar in-lieu fees. In order to manage this fund and pursue future affordable housing development, the day-to-day oversight of the City's housing operations was reassigned from the former Recreation and Park Department to the reconfigured Development Page 36 of 80 Agreement with Many Mansions October 5, 2021 Page 2 of 5 Services Department. On June 16, 2020, City Council authorized staff to prepare a Request for Qualifications (RFQ) to obtain background information from firms interested in serving as the City’s Affordable Housing Services Provider to augment and assist the City in the development and management of affordable housing units within the City. On September 8, 2020, an RFQ was released with a submittal deadline of November 9, 2020. Thirteen responses to the RFQ were submitted. On February 16, 2021, after a multi-department in-depth vetting of the proposals, City Council authorized the City Manager to enter into an Exclusive Negotiating Agreement (ENA) with Many Mansions to provide affordable housing consulting services at no cost to the City. In exchange, Many Mansions would be granted a right of first refusal to manage and develop City initiated affordable housing projects. After several months of negotiating on terms and scope of services, a proposed Professional Services Agreement is now before City Council for consideration. DISCUSSION: Many Mansions has over 40 years of experience developing and managing an array of affordable housing projects in Southern California, including providing assistance to jurisdictions via managing affordable housing projects and programs. Over the years, Many Mansions has identified, built, and managed quality, environmentally sustainable affordable housing developments that assist communities in meeting the needs of low and moderate income residents while adhering to each city's RHNA goals and targets. This firm excels in providing high quality on-site tenant services and programs. Many Mansions maintains solid financial fluidity to successfully leverage a variety of funding sources to produce successful and sustainable affordable housing projects. Many Mansions currently owns 20 properties with over 600 units, and serves as a third- party manager of an additional seven properties with another 205 units, including a 57- unit senior housing complex. As a result, Many Mansions experience and track record closely align with El Segundo’s affordable housing goals. Term and Scope If approved, the proposed agreement would expire on December 31, 2029, consistent with the end of the City's current State-mandated RHNA compliance term. Leading up to the formal award of this contract, and during the term of the agreement, Many Mansions has already performed and continues to be committed to the following tasks: Develop a formal strategic plan for producing affordable housing units to assist the City in fulfilling its RHNA goals and targets: Identify properties with the potential for affordable housing development; Page 37 of 80 Agreement with Many Mansions October 5, 2021 Page 3 of 5 Identify existing rental projects that may be suitable for acquisition, rehabilitation, and conversion to deed-restricted affordable housing units; Assist with ongoing administration and management of affordable and/or senior housing units; Serve as a consultant on the development of a revised Housing Element and RHNA compliance; and Provide consultation to staff in negotiations with market rate residential developers (including the proposed Pacific Coast Commons residential development), with the goal of obtaining as many affordable housing units as possible. The full scope of work is contained in Exhibit A of the attached Professional Services Agreement. Right of First Refusal The proposed agreement contains a clause (Section 1.C) that provides Many Mansions with the right of first refusal. This will allow Many Mansions to be the first party the City would approach for a future affordable housing development project. For example, if the City solicits a RFQ for a City-initiated affordable housing project, Many Mansions would maintain a right of first refusal to be awarded, purchase, manage, or otherwise work with the City at the same price and on the same terms and conditions as those contained in another third party’s proposal. Should Many Mansions refuse, the City would then consider and approach other responsive developers. Compensation Many Mansions agreed to provide affordable housing services for the City as detailed in the attached proposed Professional Services Agreement, Exhibit A, at no cost to the City. In return, the City will allow Many Mansions a right of first refusal for future affordable housing development. Park Vista Senior Living Facility In the late 1980s, the City used General Fund dollars to acquire and construct the 97- unit Park Vista Senior Living Facility (Park Vista) located at 615 East Holly Avenue next to Recreation Park. The property is owned by the City and managed by a private property management company, Cadmin Group. In the future, Many Mansions may be provided an opportunity to purchase and/or manage Park Vista. However, this option would take place only after City Council authorizes a study to determine the feasibility of bringing in a new operator to ensure compliance with the legal affordability of each unit. As part of the feasibility study, several issues would need to be analyzed, including the ability to maintain affordability of units for current and Page 38 of 80 Agreement with Many Mansions October 5, 2021 Page 4 of 5 future residents, keeping the facility properly maintained and managed, and exploring whether this property can be utilized to assist the City in meeting its housing requirements under the RHNA mandated by the State. In order to maintain City Council oversight, it is requested that City Council provide direction that no other City commission, committee, or board, study or agendize this issue until staff returns to City Council with an analysis and recommendation. In other words, City Council will need to provide specific direction to any City commission, committee, or board to discuss this topic. Next Steps Should City Council approve the proposed Professional Services Agreement for Affordable Housing Services between the City and Many Mansions, the following actions will occur: Many Mansions to continue consulting and advising City staff processing the Pacific Coast Commons residential development project, tentatively scheduled for City Council consideration in December 2021; Many Mansions will review and contribute to the development of the City's Housing Element implementation plan and develop strategies to address RHNA allocation (including the ongoing effort to develop an Inclusionary Housing Ordinance); Many Mansions will review and advise on SB 9 and SB 10 compliance and implementation; Many Mansions will identify Federal, State, and other funding sources and grants, and program use of the existing $5.3 million in the Affordable Housing Fund; and Many Mansions will provide a semi-annual report to City Council. CITY STRATEGIC PLAN COMPLIANCE: Goal 1: Enhance Customer Service, Engagement, and Communication; Embrace Diversity, Equity, and Inclusion Objective 1A: El Segundo Provides unparalleled service to internal and external customers. PREPARED BY: Eduardo Schonborn, AICP, Principal Planner REVIEWED BY: Michael Allen, Director APPROVED BY: Page 39 of 80 Agreement with Many Mansions October 5, 2021 Page 5 of 5 Barbara Voss, Deputy City Manager ATTACHED SUPPORTING DOCUMENTS: 1.Housing Services Provider Staff Report February 16 2021 Final 2.Many Mansions PSA 10 5 21 Page 40 of 80 City Council Agenda Statement Meeting Date: February 16, 2021 Agenda Heading: Report from Staff TITLE: Selection of Many Mansions to serve as City’s Affordable Housing Services Provider RECOMMENDATION: Authorize City Manager to enter into an Exclusive Negotiating Agreement (ENA) with Many Mansions to serve as City’s Affordable Housing Services Provider to develop and manage affordable housing units, services, and programs. FISCAL IMPACT: Once an Affordable Housing Services Provider is on board, this firm will assume financial responsibility for developing and managing the City’s Affordable Housing Program. This will include being responsible for the financial aspects of this program. Eventually, the City’s General Fund direct and indirect financial exposure will be shifted to the Affordable Housing Fund and other outside funding sources. The recommended firm has offered to donate its staff time to work with the City and community throughout the initial strategic planning process. If specific studies are required as part of the process, the firm will invoice its actual cost for the time spent with no mark ups. If there are actual costs for this effort, this would be charged to the Affordable Housing Fund. The firm selected will be compensated for its work on future affordable housing development projects via outside funding sources, including the customary developer fees, revenue streams, residual receipts, etc. The firm will also be compensated for its property management services, tenant services, and monitoring services provided to affordable housing projects via fee structures that comport with industry standards, including income generated from each project and the City’s Affordable Housing Fund. One of the main goals of this effort is to ensure that each affordable project and program remains financially sustainable over the long run without requiring recurring General Fund subsidies. BACKGROUND: Pre-Affordable Housing Program (1917–2019) Throughout El Segundo’s initial 102-year history as an incorporated municipality, the City did not have a formal affordable housing program. The City did not establish its own housing authority nor has it been part of a regional housing authority. The City did not establish a Redevelopment Agency, which would have allowed the City to receive Page 41 of 80 Recommended Affordable Housing Services Provider February 16, 2021 Page 2 of 8 Property Tax Increment revenues generated by increases in property tax revenues within each redevelopment project area. Such Property Tax Increment included a required “20% Set-Aside” that was required to be used by cities to produce and manage local affordable housing units. Through the production of such affordable housing units, many California cities were able to comply with their local Regional Housing Needs Allocation (RHNA) goals. Park Vista Senior Housing Development In the late 1980s, the City used General Fund dollars to acquire and construct the 97-unit Park Vista senior housing development located at 615 East Holly Avenue next to Recreation Park. This property is owned by the City and managed by a private property management company. City staff is compiling the original acquisition documents and City Council actions related to this project to determine what income and affordability controls were placed on this development. Commitment to Establish a City Affordable Housing Program (March 2020) In 2016, City Council approved a residential development (24 single-family units and 34 multi-family units) at the former Imperial Street School located at 540 East Imperial Avenue. Subsequent to this approval, there were several meetings to discuss the number of multi-family units that might be dedicated as “affordable units”. On Mach 17, 2020, City Council amended the project’s Specific Plan to allow the developer (DR Horton) to pay an “in-lieu” fee of $5.3 million to the City in place of dedicating and/or producing future affordable housing units. Before looking to spend any of the $5.3 million, the City established an Affordable Housing Fund and the money has remained in this fund. In order to manage this fund and pursue future development of affordable housing units, the day-to-day oversight of the City’s housing operations was reassigned from the former Recreation and Park Department to the reconfigured Development Services Department. This reorganization was formally established with the adoption of the FY 2020-2021 Citywide Budget and became effective on October 1, 2020. Affordable Housing Services Provider Request for Qualifications (RFQ) On June 16, 2020, City Council authorized staff to prepare a RFQ to obtain background information from firms interested in serving as the City’s Affordable Housing Services Provider to assist in the development and management of affordable housing units and programs. Staff developed the attached comprehensive RFQ (Exhibit D) which was released on September 8, 2020 with a submittal deadline of November 9, 2020. Copies of the RFQ were distributed to several dozen firms and were posted on a variety of websites and social media platforms. As noted in the RFQ, and explained when asked by potential submitters, it was made clear that the City was interested in firms with a proven track record of providing comprehensive affordable housing services, including the following: Page 42 of 80 Recommended Affordable Housing Services Provider February 16, 2021 Page 3 of 8 • Strong track record of producing and managing affordable housing units. • Strong history of preserving and protecting existing affordable housing stock, with minimal displacement of existing tenants. • Successful history of obtaining and leveraging affordable housing funding from a variety of outside sources, including: Federal, State, and regional governments, Federal/State low income housing tax credits, non-profits, private companies, special interest groups, etc. • Demonstrated ability to produce and construct affordable housing units on time and within budget. • Recurring history of rehabilitating existing housing units which were converted to affordable housing units. • Proven history of on-site management of affordable housing units, civic engagement, provision of an array of residential services to tenants, exemplary customer service, and minimal complaints to the local city’s governing board and administrative staff from affordable housing tenants. • Ability to provide regular updates to the City and maintain a willingness to be “on call” to the City when needed. • Successful history of assisting local cities adhere to, or at least make notable progress in complying with, their local Regional Housing Needs Assessment (RHNA) goals and requirements. As noted in the RFQ, the selected Affordable Housing Services Provider may be provided an opportunity to purchase and/or manage the Park Vista property. If the firm is interested in this option, this will be discussed at a later date and will be subject to City Council approval. DISCUSSION: 13 Affordable Housing Services Provider Responses A total of 13 responses to the RFQ were received from the following firms (listed in alphabetical order with each firm’s headquarters location): 1. Abode Communities (Los Angeles, California) 2. Anton Development (Walnut Creek, California) 3. Century Housing Corporation (Culver City, California) Page 43 of 80 Recommended Affordable Housing Services Provider February 16, 2021 Page 4 of 8 4. Chelsea Investment Corporation (Carlsbad, California) 5. Community Corporation of Santa Monica (Santa Monica, California) 6. Nextgen Apartments et.al. (El Segundo and other locations, California) 7. Jamboree Corporation (Irvine, California) 8. Many Mansions (Thousand Oaks, California) 9. McCormack Baron Salazar (Los Angeles, California) 10. National Communities Renaissance (Rancho Cucamonga, California) 11. Related California (Los Angeles, California) 12. Thomas Safran & Associates (TSA) Housing (Los Angeles, California) 13. Venice Community Housing Corporation (Los Angeles, California) Affordable Housing Services Provider Review Criteria & Process In addition to using the review criteria listed above, all 13 respondents were evaluated via the following three broad categories: • Strength and experience of the respondent’s team. • Team’s capability to manage and operate the City’s Affordable Housing Program. • Capacity to create new affordable housing while meeting the City’s RHNA goals. The following point system was assigned to the specific evaluation criteria: Criteria Maximum Points Development Experience 40 Financial Capability 30 Management & Administration Experience 30 Total 100 Page 44 of 80 Recommended Affordable Housing Services Provider February 16, 2021 Page 5 of 8 The review and selection process consisted of two phases. The first phase identified a short list of five respondents rated highest within the three broad evaluation categories. The second phase consisted of interviews of the top five respondents with the City’s evaluation committee, which consisted of the following individuals: City Development Services Director, City Principal Planner, City Land Use Planning Consultant, Keyser- Marston Housing Consultant, and City Community Development Block Grant (CDBG) Consultant. During the second week of December 2020, interviews were conducted with representatives of the top five firms. Each firm demonstrated experience in developing, managing, and operating quality affordable housing projects and programs. Each firm had experience obtaining outside affordable housing assistance funding, successful community engagement, monitoring and compliance with Federal, State, and local affordable housing occupancy and reporting requirements. Top Three Affordable Housing Service Providers The evaluation committee then narrowed the list of five firms to what it considered the three most qualified firms, as follows: 1. Many Mansions 2. Jamboree Corporation 3. Abode Communities Exhibits A, B, and C contain a copy of each firm’s RFQ response. All three firms are well-qualified with proven track records. However, the evaluation team concluded that one firm rated higher for this purpose than the other two firms. Top Rated Affordable Housing Service Provider – Many Mansions One firm, Many Mansions, stood out and most closely aligned with each of the City’s stated affordable housing service provider goals and objectives. This firm ranked highest overall in both the interview and written responses to the RFQ. It scored very high in all phases of affordable housing development and management; from the start of the process (obtaining funding for a project) to developing/constructing/rehabilitating a housing project to managing a property (including being responsive to tenant needs) to working closely and effectively with the local government. Many Mansions also demonstrated significant experience in assisting jurisdictions manage a wide array of affordable housing projects and programs, including unique special needs populations. Page 45 of 80 Recommended Affordable Housing Services Provider February 16, 2021 Page 6 of 8 With over 40 years of expanding experience in affordable housing development and management, Many Mansions’ mission most closely aligns with the City’s affordable housing program goals. Specifically, this firm identifies, builds, and manages quality, environmentally sustainable affordable housing developments that assist communities to meet the needs of low and moderate income residents while at the same time helping each of their cities adhere to their RHNA goals and targets. Many Mansions is vertically integrated with a team of seasoned professionals that include architects, engineers, financial specialists, construction managers, property managers, and service providers. Many Mansions maintains solid financial fluidity to successfully leverage a variety of funding sources to produce successful and sustainable affordable housing projects. Many Mansions has completed numerous affordable housing projects relevant to El Segundo’s size, needs, and characteristics. Many Mansions staff have demonstrated experience in working with small, urban parcel types, adaptive-reuse housing, and acquisition/rehabilitation projects. This firm works very well with cities to develop specific plans and housing policies. Its portfolio includes the preservation of "at-risk" housing through re-syndication, renovation, and affordability extension. Many Mansions representatives and employees routinely engage with local community leaders and residents to understand and foster long-standing community relationships. This firm possesses the immediate capacity to administer, manage, and monitor affordable housing units. Throughout the evaluation process, Many Mansions proved to be most qualified to meet the unique needs of the City of El Segundo’s affordable housing challenges. For example, Many Mansions is firmly committed to do the following: • Develop a formal strategic plan for producing affordable housing units to assist the City in fulfilling its RHNA goals and targets. • Identify properties with potential for affordable housing development; and existing rental projects that may be suitable for acquisition, rehabilitation, and conversion to deed-restricted affordable housing units. • Assist in ongoing administration and management of affordable and/or senior housing units in El Segundo. Many Mansions currently owns 20 properties with over 600 units and also serves as a third-party manager of an additional seven properties with another 205 units, including a 57-unit senior housing complex. Many Mansions has a growing presence in both Ventura County and Los Angeles County, with existing projects in Downtown Los Angeles and new projects under construction in Lake View Terrace, and future projects in Sun Valley and Boyle Heights. Page 46 of 80 Recommended Affordable Housing Services Provider February 16, 2021 Page 7 of 8 Many Mansions works in partnership with El Segundo-based RRM Design Group to help design its construction projects. RRM Design Group has a field office in El Segundo and the team in this office will be assigned to all projects in El Segundo. In fact, it was RRM’s El Segundo office staff that first made Many Mansions aware of the El Segundo Affordable Housing Services Provider RFQ. As a growing and expanding affordable housing services provider, Many Mansions has a field office in Downtown Los Angeles (811 Wilshire Blvd) and would like to develop a field office in El Segundo to expand its presence into the South Bay. Many Mansions conveyed that would like to grow its footprint in the community via an office located here. As a policy, Many Mansions has committed to maintaining on-site staff for each affordable housing project with 16 or more units that it develops and manages within the City. Property management and tenant services for smaller projects will be consolidated to maximize efficiency. It is clear that Many Mansions wants to not just do business with the City of El Segundo. It wants to build on its existing relationship with El Segundo-based RRM Design Group and become part of the community for the long haul. CONCLUSION & NEXT STEPS: Staff recommends that City Council authorize the City Manager to enter into an Exclusive Negotiating Agreement (ENA) with Many Mansions to serve as City’s Affordable Housing Services Provider to develop and manage affordable housing units, services, and programs. In addition, this firm will play a key role in helping the City comply with its RNHA requirements. If negotiations prove successful with Many Mansions, a development and administrative services agreement will be brought before City Council to review and approve by May 18, 2021. Once approved, work will commence immediately. Staff anticipates working with the new Affordable Housing Services Provider to present a proposed Affordable Housing Strategic Plan to City Council no later than December 7, 2021 (the last scheduled City Council meeting in 2021). ENVIRONMENTAL CONSIDERATION: This action is exempt from CEQA pursuant to CEQA Guidelines §15061(b)(3) which is the general rule that CEQA applies only to projects which have the potential for causing a significant effect on the environment and CEQA does not apply where it can be seen with certainty that there is no possibility that the activity may have a significant effect on the environment. Page 47 of 80 Recommended Affordable Housing Services Provider February 16, 2021 Page 8 of 8 CITY STRATEGIC PLAN COMPLIANCE: Goal 5: Champion Economic Development and Fiscal Sustainability. Objective A: El Segundo promotes economic growth and vitality for business and the community. Activity 5: Identify areas within the community that are appropriate for housing. PREPARED BY: Tina Gall, CDBG Consultant REVIEWED BY: Sam Lee, Director of Development Services APPROVED BY: Scott Mitnick, City Manager ATTACHED SUPPORTING DOCUMENTS: A. Many Mansions RFQ Response B. Jamboree RFQ Response C. Abode RFQ Response D. El Segundo Affordable Housing Services Provider Request for Qualifications (RFQ) File: SM\Housing Services Provider Staff Report February 16, 2021 – Word Page 48 of 80 Agreement No. 1 PROFESSIONAL SERVICES AGREEMENT (AFFORDABLE HOUSING SERVICES) BETWEEN THE CITY OF EL SEGUNDO AND MANY MANSIONS, A CALIFORNIA NONPROFIT CORPORATION This Agreement is made and entered into this day of October, 2021 (the “Effective Date”), by and between the City of El Segundo, a municipal corporation and general law city (“CITY”) and Many Mansions, a California Nonprofit Corporation, (“CONSULTANT”). The parties agree as follows: 1. CONSIDERATION. A. As partial consideration, CONSULTANT agrees to perform the work listed in the SCOPE OF SERVICES, below; B. As additional consideration, CONSULTANT and CITY agree to abide by the terms and conditions contained in this Agreement; C. As additional consideration, the CITY agrees to provide the CONSULTANT a right of first refusal to be awarded, purchase, manage, or otherwise work with the CITY at the same price and on the same terms and conditions as those contained in a third party offer that the CITY expressed willingness to accept or at a set price the CITY has agreed to accept under a Request for Qualifications, Request for Proposals or similar offering by the CITY to acquire, build, convert or create City- restricted affordable housing during the 2021-2029 (6th Cycle) Housing Element period, provided the CITY is either an applicant or co-applicant for said affordable housing project and the CITY contributes funding (CITY funds or CITY-obtained grant funds) to the project, and further provided that CONSULTANT meets all of the qualifications set forth in the applicable Request for Proposals. D. In the event CITY chooses to convert the Park Vista senior housing property to a deed-restricted affordable senior housing facility, CONSULTANT may be provided an opportunity to purchase and/or manage the Park Vista property after the issue of sale of the facility to an affordable housing is studied and/or a decision is made by the City Council regarding its potential sale. If the CONSULTANT is interested in this option, this will be discussed at a later date and will be subject to City Council approval in its sole discretion. 2. SCOPE OF SERVICES. A. CONSULTANT will perform services listed in the attached Exhibit “A,” which is incorporated by reference. Page 49 of 80 Agreement No. 2 B. Other than the consideration contained in Section 1, CONSULTANT will provide its services under this Agreement without charge throughout the initial affordable housing strategic planning process. CONSULTANT will, in a professional manner, furnish all of the labor, technical, administrative, professional and other personnel, all supplies and materials, equipment, vehicles, transportation, office space and facilities, and all other means whatsoever, except as herein otherwise expressly specified to be furnished by CITY, necessary or proper to perform and complete the work and provide the professional services required of CONSULTANT by this Agreement. If third-party studies are required as part of the scope of services, CONSULTANT will invoice the CITY its actual cost for the time spent with no mark ups. No such third-party studies will be ordered or commissioned without the prior written consent of CITY. 3. PAYMENTS. No payments by CITY to CONSULTANT are anticipated or required for any of CONSULTANT’s services provided hereunder. In the event that any third-party studies are authorized by CITY in writing and ordered or commissioned by CONSULTANT, CONSULTANT must submit a detailed invoice to CITY for the completed work. If the information in the invoice is acceptable to CITY, CITY will reimburse CONSULTANT within 45 calendar days after receipt of the invoice. 4. FAMILIARITY WITH WORK. A. By executing this Agreement, CONSULTANT agrees that it has: i. Thoroughly investigated and considered the scope of services to be performed; ii. Carefully considered how the services should be performed; and iii. Understands the facilities, difficulties, and restrictions attending performance of the services under this Agreement. 5. KEY PERSONNEL. A. CONSULTANT’s key personnel assigned to perform work under this Agreement and their level of responsibility were included in the CONSULTANT’s RFQ response dated November 09, 2020, incorporated herein by this reference. B. The resume of each of the individuals identified in this Section were included in the CONSULTANT’s RFQ response dated November 09, 2020, and are incorporated herein by this reference. C. In the event CITY objects to the continued involvement with this Agreement by any of the persons listed in this Section, CONSULTANT agrees that it will replace such persons with individuals that are agreed to by CITY. Page 50 of 80 Agreement No. 3 6. PROJECT COORDINATION AND SUPERVISION. The CITY’s Director of Development Services will be the key contact person for the CITY for purposes of this Agreement and the subject matter hereof. CONSULTANT’s key personnel as identified in its RFQ response will interface and cooperate with the Director of Development Services when providing services pursuant to this Agreement. 7. TERM. The term of this Agreement will start on the Effective Date and, unless terminated sooner in accordance with Section 12, will end on December 31, 2029. 8. TIME FOR PERFORMANCE. CONSULTANT will not perform any work under this Agreement until CONSULTANT furnishes proof of insurance as required under Section 19 of this Agreement. 9. TAXPAYER IDENTIFICATION NUMBER. CONSULTANT will provide CITY with a Taxpayer Identification Number. 10. PERMITS AND LICENSES. CONSULTANT, at its sole expense, will obtain and maintain during the term of this Agreement, all necessary permits, licenses, and certificates that may be required in connection with the performance of services under this Agreement. 11. WAIVER. CITY’s review or acceptance of, or payment for, work product prepared by CONSULTANT under this Agreement will not be construed to operate as a waiver of any rights CITY may have under this Agreement or of any cause of action arising from CONSULTANT’s performance. A waiver by CITY of any breach of any term, covenant, or condition contained in this Agreement will not be deemed to be a waiver of any subsequent breach of the same or any other term, covenant, or condition contained in this Agreement, whether of the same or different character. 12. TERMINATION. A. Except as otherwise provided, CITY may terminate this Agreement at any time with or without cause. Notice will be in writing at least thirty (30) days before the effective termination date. B. CONSULTANT may terminate this Agreement at any time with or without cause. Notice will be in writing at least thirty (30) days before the effective termination date. C. Upon receiving a termination notice, CONSULTANT will immediately cease performance under this Agreement unless otherwise provided in the termination notice. Except as otherwise provided in the termination notice, any additional work performed by CONSULTANT after receiving a termination notice will be performed at CONSULTANT’s own cost; CITY will not be obligated to compensate CONSULTANT for such work. D. Should the Agreement be terminated pursuant to this Section, CITY may procure on its own terms services similar to those terminated. Page 51 of 80 Agreement No. 4 E. By executing this document, CONSULTANT waives any and all claims for damages that might otherwise arise from CITY’s termination under this Section. 13. OWNERSHIP OF DOCUMENTS. All documents, data, studies, drawings, maps, models, photographs and reports prepared by CONSULTANT under this Agreement are CITY’s property. CONSULTANT may retain copies of said documents and materials as desired but will deliver all original materials to CITY upon CITY’s written notice. CITY agrees that use of CONSULTANT’s completed work product, for purposes other than identified in this Agreement, or use of incomplete work product, is at CITY’s own risk. 14. PUBLICATION OF DOCUMENTS. Except as necessary for performance of service under this Agreement, no copies, sketches, or graphs of materials, including graphic art work, prepared pursuant to this Agreement, will be released by CONSULTANT to any other person or public CITY without CITY’s prior written approval. All press releases, including graphic display information to be published in newspapers or magazines, will be approved and distributed solely by CITY, unless otherwise provided by written agreement between the parties. 15. INDEMNIFICATION. A. CONSULTANT agrees to the following: i. Indemnification for Damages. CONSULTANT agrees to indemnify and hold CITY harmless from and against any claim, action, damages, costs (including, without limitation, attorney’s fees), injuries, or liability, arising out of this Agreement, or its performance, except for such loss or damage arising from CITY’s sole negligence or willful misconduct. Should CITY be named in any suit, or should any claim be brought against it by suit or otherwise, whether the same be groundless or not, arising out of this Agreement, or its performance, CONSULTANT will defend CITY (at CITY’s request and with counsel satisfactory to CITY) and will indemnify CITY for any judgment rendered against it or any sums paid out in settlement or otherwise. B. For purposes of this Section, “CITY” includes CITY’s officers, officials, employees, agents, attorneys, representatives, and volunteers. C. It is expressly understood and agreed that the foregoing provisions will survive termination of this Agreement. D. The requirements as to the types and limits of insurance coverage to be maintained by CONSULTANT as required by Section 19, and any approval of said insurance by CITY, are not intended to and will not in any manner limit or qualify the liabilities and obligations otherwise assumed by CONSULTANT pursuant to this Agreement, including, without limitation, to Page 52 of 80 Agreement No. 5 the provisions concerning indemnification. 16. ASSIGNABILITY. This Agreement is for CONSULTANT’s professional services and is not assignable. Any attempt by CONSULTANT to assign the benefits or burdens of this Agreement without CITY’s written approval are prohibited and will be null and void. 17. INDEPENDENT CONTRACTOR. CITY and CONSULTANT agree that CONSULTANT will act as an independent contractor and will have control of all work and the manner in which it is performed. CONSULTANT will be free to contract for similar service to be performed for other employers while under contract with CITY. CONSULTANT is not an agent or employee of CITY and is not entitled to participate in any pension plan, insurance, bonus or similar benefits CITY provides for its employees. Any provision in this Agreement that may appear to give CITY the right to direct CONSULTANT as to the details of doing the work or to exercise a measure of control over the work means that CONSULTANT will follow the direction of the CITY as to end results of the work only. 18. AUDIT OF RECORDS. CONSULTANT will maintain full and accurate records with respect to all services and matters covered under this Agreement. CITY will have free access at all reasonable times to such records, and the right to examine and audit the same and to make transcripts therefrom, and to inspect all program data, documents, proceedings and activities. CONSULTANT will retain such financial and program service records for at least three (3) years after termination or final payment under this Agreement. 19. INSURANCE. A. Before commencing performance under this Agreement, and at all other times this Agreement is effective, CONSULTANT must procure and maintain the following types of insurance with coverage limits complying, at a minimum, with the limits set forth below: Type of Insurance Limits Commercial general liability: $2,000,000 Business automobile liability $1,000,000 Workers compensation Statutory requirement B. Commercial general liability insurance will meet or exceed the requirements of the most recent ISO-CGL Form. The amount of insurance set forth above will be a combined single limit per occurrence for bodily injury, personal injury, and property damage for the policy coverage. Liability policies will be endorsed to name CITY, its officials, and employees as “additional insureds” under said insurance coverage and to state that such insurance will be deemed “primary” such that any other insurance that may be carried by CITY will be excess thereto. Such endorsement must be reflected on ISO Form No. CG 20 10 11 85 or 88, or equivalent. Such insurance will be on an “occurrence,” not a “claims made,” basis and will not be cancelable or subject to reduction except upon 30 days prior written notice to CITY. Page 53 of 80 Agreement No. 6 C. Automobile coverage will be written on ISO Business Auto Coverage Form CA 00 01 06 92, including symbol 1 (Any Auto). D. CONSULTANT will furnish to CITY duly authenticated Certificates of Insurance evidencing maintenance of the insurance required under this Agreement and such other evidence of insurance or copies of policies as may be reasonably required by CITY from time to time. Insurance must be placed with insurers with a current A.M. Best Company Rating equivalent to at least a Rating of “A:VII.” E. Should CONSULTANT, for any reason, fail to obtain and maintain the insurance required by this Agreement, CITY may obtain such coverage at CONSULTANT’s expense and deduct the cost of such insurance from payments due to CONSULTANT under this Agreement or terminate the Agreement immediately by providing written notice in accordance with Section 22. 20. USE OF CONSULTANT. CONSULTANT must obtain CITY’s prior written approval to use any consultants while performing any portion of this Agreement. Such approval must approve of the proposed consultant and the terms of compensation. 21. INCIDENTAL TASKS. CONSULTANT will meet or will participate in videoconference calls with CITY on an as-needed basis to provide the status on the project, which will include a schedule update and a short narrative description of progress during the past month(s) for each major task, a description of the work remaining and a description of the anticipated work to be done before the next schedule update. 22. NOTICES. All communications to either party by the other party will be deemed given when sent to the party at its respective name and address as follows: If to CITY: Development Services Dept. 350 Main Street El Segundo, CA 90245 Attention: Director, Development Services And: City Clerk 350 Main Street El Segundo, CA 90245 If to CONSULTANT: Many Mansions 1259 E. Thousand Oaks Blvd. Thousand Oaks, CA 91362 Attention: Rick Schroeder, President Phone: 805-496-4948 Ext. 227 Email: rick@manymansions.org Any such written communications by mail will be conclusively deemed to have been given to the addressee upon deposit thereof in the United States Mail, postage prepaid and properly addressed as noted above. In all other instances, Page 54 of 80 Agreement No. 7 notices will be deemed given at the time of actual delivery to the address indicated herein. Changes may be made in the names or addresses of persons to whom notices are to be given by giving notice in the manner prescribed in this paragraph. 23. CONFLICT OF INTEREST. CONSULTANT will comply with all conflict of interest laws and regulations including, without limitation, CITY’s conflict of interest regulations. 24. SOLICITATION. CONSULTANT maintains and warrants that it has not employed nor retained any company or person, other than CONSULTANT’s bona fide employee, to solicit or secure this Agreement. Further, CONSULTANT warrants that it has not paid nor has it agreed to pay any company or person, other than CONSULTANT’s bona fide employee, any fee, commission, percentage, brokerage fee, gift or other consideration contingent upon or resulting from the award or making of this Agreement. Should CONSULTANT breach or violate this warranty, CITY may rescind this Agreement immediately and without liability. 25. THIRD PARTY BENEFICIARIES. This Agreement and every provision herein is generally for the exclusive benefit of CONSULTANT (or its affiliates) and CITY and not for the benefit of any other party. There will be no incidental or other beneficiaries of any of CONSULTANT’s (or its affiliates) or CITY’s obligations under this Agreement. 26. INTERPRETATION. This Agreement was drafted in and will be construed in accordance with the laws of the State of California, and exclusive venue for any action involving this agreement will be in Los Angeles County. 27. COMPLIANCE WITH LAW. CONSULTANT agrees to comply with all federal, state, and local laws applicable to this Agreement. 28. ENTIRE AGREEMENT. This Agreement, and its Exhibit(s), sets forth the entire understanding of the parties. There are no other understandings, terms or other agreements expressed or implied, oral or written. This Agreement will bind and inure to the benefit of the parties to this Agreement and any subsequent successors and assigns. 29. CONSISTENCY. In interpreting this Agreement and resolving any ambiguities, the main body of this Agreement takes precedence over the attached Exhibits; this Agreement supersedes any conflicting provisions. Any inconsistency between the Exhibits will be resolved in the order in which the Exhibits appear below: Exhibit: A: Scope of Work. 30. RULES OF CONSTRUCTION. Each Party had the opportunity to independently review this Agreement with legal counsel. Accordingly, this Agreement will be construed simply, as a whole, and in accordance with its fair meaning; it will not be interpreted strictly for or against either Party. Page 55 of 80 Agreement No. 8 31. SEVERABILITY. If any portion of this Agreement is declared by a court of competent jurisdiction to be invalid or unenforceable, then such portion will be deemed modified to the extent necessary in the opinion of the court to render such portion enforceable and, as so modified, such portion and the balance of this Agreement will continue in full force and effect. 32. AUTHORITY/MODIFICATION. The Parties represent and warrant that all necessary action has been taken by the Parties to authorize the undersigned to execute this Agreement and to engage in the actions described herein. This Agreement may be modified only by written amendment signed by the Parties. 33. ACCEPTANCE OF ELECTRONIC SIGNATURES. The Parties agree that this Agreement, agreements ancillary to this Agreement, and related documents to be entered into in connection with this Agreement will be considered signed when the signature of a party is delivered by electronic (.pdf) or facsimile transmission. Such electronic or facsimile signature will be treated in all respects as having the same effect as an original signature. 34. CAPTIONS. The captions of the paragraphs of this Agreement are for convenience of reference only and will not affect the interpretation of this Agreement. 35. FORCE MAJEURE. Should performance of this Agreement be prevented due to fire, flood, explosion, acts of terrorism, war, embargo, government action, civil or military authority, the natural elements, or other similar causes beyond the Parties’ reasonable control, then the Agreement will immediately terminate without obligation of either party to the other. 36. STATEMENT OF EXPERIENCE. By executing this Agreement, CONSULTANT represents that it has demonstrated trustworthiness and possesses the quality, fitness and capacity to perform the Agreement in a manner satisfactory to CITY. CONSULTANT represents that its financial resources, surety and insurance experience, service experience, completion ability, personnel, current workload, experience in dealing with private consultants, and experience in dealing with public agencies all suggest that CONSULTANT is capable of performing the proposed contract and has a demonstrated capacity to deal fairly and effectively with and to satisfy a public agency. [Signatures on next page] Page 56 of 80 Agreement No. 9 IN WITNESS WHEREOF the parties hereto have executed this Agreement the day and year first hereinabove written. CITY OF EL SEGUNDO CONSULTANT Scott Mitnick, Rick Schroeder, City Manager President Taxpayer ID No. 953424516 ATTEST: Tracy Weaver, City Clerk APPROVED AS TO FORM: Mark D. Hensley, City Attorney Page 57 of 80 Agreement No. 10 Exhibit “A” Scope of Work 1. Meet with the City staff as needed to finalize the City’s affordable goals and objectives (consistent with goals stated in the RFQ released September 08, 2020, and any others). 2. Recommend strategies to remove constraints and/or increase affordable housing production based on industry best practices. 3. Create a list of high priority neighborhoods and/or sites based on the current (or draft) Housing Element, City recommendations, and Consultant’s expertise. 4. Solicit community feedback via a City-approved community engagement plan that includes at least two community workshops. 5. Develop a draft Affordable Housing Strategic Plan (AHSP), with an emphasis on fulfilling the 6th cycle Regional Housing Needs Assessment (RHNA) goals, for City review. 6. Work with City staff to present a proposed Affordable Housing Strategic Plan to City Council no later than June 30, 2022. 7. Utilizing the approved AHSP (if applicable), Consultant will work with the City to identify properties with the potential for affordable housing development and existing rental projects that may be suitable for acquisition, rehabilitation and conversion to City-restricted affordable housing projects. 8. Work with the City to review and revise the AHSP, as needed. 9. Assist City with the ongoing monitoring and administration of affordable and/or senior housing units produced in El Segundo. Page 58 of 80 City Council Agenda Statement Meeting Date: October 5, 2021 Agenda Heading: Staff Presentations Item Number: D.11 TITLE: El Segundo Dial-A-Ride Program Update RECOMMENDATION: Receive and file. FISCAL IMPACT: None BACKGROUND: No written staff report, staff will provide a verbal presentation. Page 59 of 80 City Council Agenda Statement Meeting Date: August 17, 2021 Agenda Heading: Staff Presentations Item Number: D.13 TITLE: Covid-19 Update and Ratify City Manager’s Amendment to Administrative Order No. 1 dated June 29, 2021 RECOMMENDATION: 1. Receive and file Covid-19 Update. 2. Ratify Amendment to Administrative Order No. 1 addressing extended temporary encroachment permits for restaurants and retail food facilities conducting outdoor dining service within the public right-of-way to September 30, 2021. FISCAL IMPACT: None BACKGROUND: When a local or state emergency is declared, the City’s municipal code provides for the carrying out of plans for the protection of persons and property within the city. In such an emergency, the City Manager serves as the Director of Emergency Services (“Director”). The Director is empowered to, make and issue rules and regulations on matters reasonably related to the protection of life and property, and to acquire equipment, materials, supplies and services without following the City’s standard purchasing procedures. However, such rules and regulations must be confirmed at the earliest practicable time by the city council. (ESMC §§ 2-2-5). DISCUSSION: On January 29, 2021, the City Manager issued Amended and Restated Administrative Order No. 1, which allowed restaurants and retail food facilities conducting outdoor dining service within the public right-of-way to apply for and be issued a temporary encroachment permit. Under that order, the permits were to automatically expire on June 30, 2021. On June 29, 2021, the City Manager issued an amendment to that Page 60 of 80 Covid-19 Update and Ratify City Manager’s Amendment to Administrative Order No. 1 August 17, 2021 Page 2 of 2 order, extending the expiration date of the previously-issued encroachment permits to September 30, 2021. The amendment also repealed a requirement that any persons in the common area of the Park Vista Senior Housing Facility must wear a face covering or mask. The Director requests the City Council ratify the amendment. CITY STRATEGIC PLAN COMPLIANCE: Goal 2: Support Community Safety and Preparedness Objective: El Segundo is a safe and prepared city. PREPARED BY: Randal A. Collins, Emergency Management Coordinator REVIEWED BY: Mark Hensley, City Attorney APPROVED BY: Barbara Voss, Deputy City Manager ATTACHED SUPPORTING DOCUMENTS: 1.SM_AmendmentOrder_June292021 Page 61 of 80 SECOND AMENDMENT TO ADMINISTRATIVE ORDER NO. 1 TO ADDRESS COVID-19 On January 29, 2021, I issued an Amended and Restated Administrative Order No. 1 to Address COVID-19 (the “Order”). The Order was subsequently amended on June 29, 2021. By virtue of authority vested in me as the City Manager of the City of El Segundo pursuant to El Segundo Municipal Code § 2-2-5 to promulgate, issue, and enforce rules, regulations, orders, and directives, the Order is again hereby amended in the following particulars: 1) Paragraph 3 is amended to provide that the Public Works Director or designee may issue Temporary Encroachment Permits that may remain effective until terminated by order of the City Manager. Any Temporary Encroachment Permit issued pursuant to the Order that is set to expire on September 30, 2021 is hereby extended and shall remain effective until terminated by order of the City Manager. Office of the City Manager Elected Officials Drew Boyles, Mayor Chris Pimentel, Mayor Pro Tem Carol Pirsztuk,Councilmember Scot Nicol,Councilmember Lance Giroux, Councilmember Tracy Weaver, City Clerk Matthew Robinson, City Treasurer Department Directors Barbara Voss, Deputy City Manager Joseph Lillio, Chief Financial Officer Melissa McCollum,Community Services Director Michael Allen, Development Services Director Deena Lee.Acting Fire Chief Rebecca Redyk,Human Resources Director Charles Mallory,Information Technology Director Jaime Bermudez,Interim Police Chief Elias Sassoon,Public Works Director Appointed Officials Scott Mitnick, City Manager Mark D. Hensley, City Attorney Scott MitnickCity Manager/Director of Emergency ServicesCity of El Segundo Date:September 29, 2021 Page 62 of 80 City Council Agenda Statement Meeting Date: October 5, 2021 Agenda Heading: Staff Presentations Item Number: D.11 TITLE: FY 2020-2021 Year-End Financial Report RECOMMENDATION: Receive and file the unaudited FY 2020-2021 Year-End Financial Report FISCAL IMPACT: None BACKGROUND: Staff has reviewed all revenues and expenditures in the General Fund, as well as all revenues and expenses in the Enterprise Funds and Internal Service Funds for FY 2020-2021. DISCUSSION: A detailed report is attached that provides discussion on how the General Fund performed with regards to both revenues and expenditures. The report also discusses the year-end performance of the various Enterprise Funds, Internal Service Funds, Debt Fund, and the Senior Housing Fund. CITY STRATEGIC PLAN COMPLIANCE: Goal 5: Champion Economic Development and Fiscal Sustainability Objective 5B: El Segundo approaches its work in a financially strategic and responsible way. PREPARED BY: Joseph Lillio, Chief Financial Officer Page 63 of 80 FY 2020-2021 Year-End Financial Report October 5, 2021 Page 2 of 2 REVIEWED BY: Joseph Lillio, Chief Financial Officer APPROVED BY: Barbara Voss, Deputy City Manager ATTACHED SUPPORTING DOCUMENTS: 1.FYE 2020-2021 Financial Review Page 64 of 80 Finance Department MEMORANDUM 350 Main Street El Segundo, CA 90245 Phone 310-524-2300 | ww.elsegundo.org To: Honorable Mayor and Members of City Council From: Scott Mitnick, City Manager & Joseph Lillio, Chief Financial Officer Date: October 5, 2021 Subject: Unaudited Fiscal Year-end 2020-2021 Financial Review BACKGROUND: The Adopted Operating Budget for Fiscal Year (FY) 2020-2021 was a balanced budget. With this budget, the City began the process to shift from using the October 1 to September 30 fiscal year cycle to a more traditional July 1 to June 30 cycle. As a result, FY 2020-21 operated within an abbreviated nine-month budget cycle from October 1, 2020 to June 30, 2021. This allowed the following year to run for a full 12 months from July 1, 2021 to June 30, 2022. COVID-19 & Social Justice Protest Impacts Due to the unanticipated effects of two simultaneous national and local “State of Emergency” situations (the global COVID-19 pandemic which started in February 2020 and the social justice protest in response to the tragic death of George Floyd in Minneapolis on May 25, 2020), the local El Segundo economy experienced considerable impacts during FY 2020-21. This has translated into significant reductions to local City revenues and funding for budget appropriations compared to the last several previous fiscal years. Until the number of Coronavirus cases drop significantly for a sustainable period and a vast majority of the public is vaccinated, the financial impacts are likely to continue to impact the local El Segundo City Budget. Extensive Budget Preparation & Discussion Process The FY 2020-2021 budget preparation process with City Council started in earnest with the April 21, 2020 Closed Session discussion of the early financial impacts of the evolving COVID-19 pandemic crisis. The public discussion commenced with the May 5th FY 2019- 2020 General Fund Mid-Year Budget Update presentation to City Council. At that meeting, staff presented “Economic Recovery Scenarios” which were based on the following three different “economic recovery” timeframes: Page 65 of 80 FYE 2020-21 Financial Review October 5, 2021 Page 2 of 11 Scenario One -- COVID-19 peaks in May 2020 & Economic Recovery starts in July 2020 With the General Fund projected to experience a $9.6 million (12%) revenue decline. Scenario Two -- COVID-19 peaks in August 2020 & Economic Recovery starts in Oct. 2020 With the General Fund projected to experience a $15.2 million (or 20%) revenue decline. Scenario Three -- COVID-19 peaks in Dec. 2020 & Economic Recovery starts in Jan. 2021 With the General Fund projected to experience a $16.1 million (21%) revenue decline. Over the course of developing the FY 2020-21 Budget, it became evident that Economic Recovery Scenario Two was the more likely outcome. Based on the best information available at the time, adjustments were made to accommodate Economic Recovery Scenario Two in the adoption of the FY 2020-21 Budget. Revenue estimates and budget appropriations were developed to ensure that FY 2020-21 adopted a balanced budget. This included not filling 20 vacant positions. GENERAL FUND Table 1: FY 2020-21 GF Revenues Adopted v. YE Actuals (unaudited) No.General Fund Revenues FY 2020-2021 Adopted Revenues FY 2020-2021 Unaudited Actuals Actuals over/(under) Budget % Received 1 Business License Tax $10,489,360 $11,818,672 $1,329,312 113% 2 Property Tax 9,645,025 10,307,172 662,147 107% 3 Sales Tax 8,373,683 8,339,284 (34,399)100% 4 Chevron Tax Reso Agree 6,000,000 6,678,446 678,446 111% 5 Utility Users Tax 4,494,047 5,022,531 528,484 112% 6 Transient Occupancy Tax 7,524,570 4,893,187 (2,631,383)65% 7 Charges for Service 3,415,836 4,024,259 608,423 118% 8 Franchise Tax 2,250,000 2,940,024 690,024 131% 9 Other Revenues 1,917,064 2,276,107 359,043 119% 10 Intergovern Revenues 1,942,770 2,084,471 141,701 107% 11 License & Permits 1,153,769 1,748,546 594,777 152% 12 Transfers -in 948,708 948,708 0 100% 13 Interest & Rentals 603,000 360,658 (242,342)60% 14 Fines & Forfeitures $294,000 $266,634 ($27,366)91% Total GF Revenue $59,051,832 $61,708,698 $2,656,866 104% Page 66 of 80 FYE 2020-21 Financial Review October 5, 2021 Page 3 of 11 The above table reflects the GF revenues that were included with the adopted FY 2020- 2021 budget and the year-end unaudited actuals. Excluding effect of the pension obligation bond issuance, the year-end unaudited actuals came in slightly higher than the revenue that was anticipated with the adoption of the budget. The year-end unaudited actuals were $2.7 million higher than the original FY 2020-2021 revenues. This equates to a 4.5% increase in revenues compared to the adopted budget. Total GF unaudited revenues ended the fiscal year $2,656,866 higher than the adopted budget. As noted in the table above, the major variances in estimates compared to the year-end actuals in revenues are as follows: 1.Business License Taxes: +$1,329,312 (+13%), mainly due to the increases in base business tax rates. 2.Property Taxes: +$662,147 (+7%), driven by the Prop. 13 increases in property values, a change in ownership of properties which reassesses the property at current market value, and the delinquency rate of 5% projected in the revised revenue projections did not materialize. 3. Sales & Use Taxes: very close to budget, the city received relative stable allocation from the state/county-wide pool during the COVID 19 pandemic, Local business and industry sales also started to pick up with graduate re- open complying with the Los Angeles County Department of Health. 4. Chevron Tax Resolution Agreement: Year-end revenue was up by $678,446 (+11%) due to this year’s payment was based on the prior year’s actual tax revenue received from Chevron and a “true-up” payment to be paid the following fiscal year once the actual tax revenues have been reconciled. There is an established annual tax ceiling for Chevron that is increased each year by the applicable Consumer Price Index (CPI). 5. UUT: +$528,484 (+12%), mainly due to increases in Electric Utility User Tax and Cogenerated Electric/Chevron. 6. Transient Occupancy Tax: -$2,631,383 (-35%), caused by hotel vacancies and delinquencies as a result of COVID-19 and travel restrictions in place by the State of California and the Los Angeles County Department of Health. The average occupancy rate (~50%) and room rate were still low in the months preceding the pandemic outbreak. 7.Charges for Services: +$608,423 (+18%), contributed by an increase in Wiseburn Drop-In Programs and Facility Reservation Fees. 8.Franchise Fees: +$690,024 (+31%), this revenue source is primarily made up of the annual payment received by Southern California Edison (SCE) and The Gas Co. The actual payments were higher than expected. 9.Other Revenues: Year-end revenue was up by $359,043 (19%) due to an increase in billing for reimbursement of staff time used by third party entities (fully burdened rate used), billings related to damage to City property Page 67 of 80 FYE 2020-21 Financial Review October 5, 2021 Page 4 of 11 (restitution), and an increase in SB90 State mandated reimbursements received. 10.Intergovernmental: +$141,701 (+7%), driven by increases in Vehicle License Fee (VLF). 11.Licenses and Permits: +$594,777 (+52%), contributed by an increase in Building Permits and Electrical Permits. 12.Transfers-in: unaudited year-end revenue was identical to the adopted revenue. The source of this revenue is the transfer-in from the Economic Uncertainty Reserve 13.Interest Earnings & Rental Income: -$242,342 (-40%), driven by decreases in Interest on Investments. The interest rate on U.S. Treasuries, Federal Agencies, municipal bonds, and CDs dropped at the end of calendar 2020 and kept the same tendency in calendar year 2021. 14.Fines & Forfeitures: -$27,366 (-9%), mainly due to a slight decrease in Parking Fines. The following graph depicts the last five years of the top ten General Fund Revenue sources from FY 2016-17 through FY 2020-21. FY 2020-21 was only nine months due to the change in fiscal year measurement period. - 2,000,000 4,000,000 6,000,000 8,000,000 10,000,000 12,000,000 14,000,000 16,000,000 FY 2016-2017 FY 2017-2018 FY 2018-2019 FY 2019-2020 FY 2020-2021 Transient Occupancy Tax Business License Tax Sales Tax Property Tax Utility Users Tax Tax Resolution Agreement Charges for Service Other Revenues Franchise Tax Top Ten GF Revenue Sources - Last 5 Years Page 68 of 80 FYE 2020-21 Financial Review October 5, 2021 Page 5 of 11 The above graph depicts the total General Revenue the City received by fiscal year from FY 2015-16 through FY 2020-21. It is evident the severe negative impacts that COVID-19 and the related economic shut down had on the City of El Segundo’s General Fund revenues. The drop in General Fund revenue from FY 2018-19 to FY 2019-20 was $7.7 million or 9.6%. However, the General Fund revenue trend would have resulted in revenue of approximately $84 million if COVID-19 did not occur. The true revenue loss from FY 2018-19 to FY 2019-20 was $11.5 million or 13.7%. The revenue loss from actual revenue received in FY 2018-19 to FY 2020-21 was $18.5 million or 23%. However, if measured against the General Fund revenue trend of approximately $84 million if COVID-19 did not occur, the true revenue loss from FY 2018-19 to FY 2020-21 was $22.3 million or 26.6%. These are drastic revenue losses that will have lasting fiscal challenges for the City to strategically address moving forward. Fiscal Year-end (FYE) 2020-2021 General Fund Appropriations Adopted General Fund Appropriations for FY 2020-2021 were $59,051,732 and the unaudited year-end expenditure actuals were $58,933,884. The adopted budget was remarkably close to the year-end actuals with variance of 0.02%, $117,848. The table below illustrates the adopted budget to unaudited actuals by department: 65,338,214 71,393,455 75,935,689 80,208,257 72,503,402 61,708,699 $0 $10,000,000 $20,000,000 $30,000,000 $40,000,000 $50,000,000 $60,000,000 $70,000,000 $80,000,000 $90,000,000 FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20 FY 2020-21 Total General Fund Revenue Page 69 of 80 FYE 2020-21 Financial Review October 5, 2021 Page 6 of 11 Table 2: FY 2020-21 General Fund Adopted Appropriations v. YE Actuals (unaudited) General Fund Appropriations FY 2020-21 FY 2020-21 ($)% of No.Department Adopted Budget Unaudited Actuals Variance Budget 1 Police $17,879,525 $17,490,039 $389,486 98% 2 Fire 13,068,393 13,494,884 (426,491)103% 3 Public Works 7,253,488 7,101,758 151,730 98% 4 Non-Departmental 3,780,217 4,802,964 (1,022,747)127% 5 Community Services 4,661,460 3,611,561 1,049,899 77% 6 Information Technology 2,440,068 2,477,865 (37,797)102% 7 Development Services 2,609,024 2,027,281 581,743 78% 8 City Manager 1,909,586 2,015,161 (105,575)106% 9 Finance & Treasury 2,038,556 1,988,815 49,741 98% 10 Transfers Out 1,250,000 1,395,956 (145,956)112% 11 Human Resources 917,405 698,334 219,071 76% 12 COVID-19 Response - 667,986 (667,986)N/A 13 City Attorney 561,950 527,127 34,823 94% 14 City Clerk 421,157 377,598 43,559 90% 15 City Council 260,903 251,947 8,956 97% 16 Social Justice Protest - $4,608 ($4,608)N/A Total $59,051,732 $58,933,884 $117,848 99.8% As noted in the table above, the major changes to estimates in expenditures are as follows: 1. Police: a decrease in salaries, benefits, and overtime due to position vacancies. 2. Fire: an increase in salaries, benefits, and overtime due to COVID-19 pandemic. 3. Public Works: a decrease in salaries and benefits due to position vacancies. 4. Non-departmental: over budget due to a combination of several factors: an increase in accrued vacation/sick payouts, significantly highly unemployment compensation expenditures associated with part-time staff that were not employed during Park, Recreation, and Library program shutdowns. 5. Community Services: due to COVID-19 the services provided by Library, Recreation, and many of the Parks were not offered and facilities were shutdown in order to comply with the State and County health mandates. 6. Information Technology: slightly above budget due to numerous technology related projects that were implemented during the fiscal year. 7. Development Services: a decrease in professional services and in salaries, benefits, and overtime due to position vacancies. 8. City Manager: $105,575 over budget due expenditures related to LAX mitigation Page 70 of 80 FYE 2020-21 Financial Review October 5, 2021 Page 7 of 11 efforts. 9. Finance & Treasury: a decrease in salaries and benefits due to position vacancies. 10.Transfers Out: over budget due to additional funds transferred out to the CIP Fund for City Council approved projects. 11.Human Resources: a decrease in salaries and benefits due to position vacancies. 12.COVID-19 Response: These costs were tracked separately in order to claim reimbursement from FEMA for the COVID related activities. This activity was not budgeted for; however, the City has filed several claims with FEMA with the intent of being reimbursed up to 100% for the COVID related expenditures. 13.City Attorney: slightly under budget. 14.City Clerk: slightly under budget due to a decrease in professional services and advertising expenditures. 15.City Council: slightly under budget due to a decrease in meetings and travel. 16.Social Justice Protests: Year-end expenditures specifically associated to the City’s response were not included in each department’s budget totaled $4,608. These costs were tracked separately in the event FEMA may decide to reimburse municipalities for the social justice protests that occurred during the Fall of 2020. The federal government has decided to disallow claims associated with social justice unrest. Therefore, the expenditures related to the social justice protests will not be eligible for either FEMA or State of California reimbursement. Fiscal Year-end (FYE) 2020-21 General Fund Results Table 3 represents the City’s General Fund balance and reserves. The fund balance is the amount of financial resources immediately available for use. The City also has a Council policy to maintain a 20% general fund financial reserve for the current fiscal year and 25% reserve for the long-term goal. The additional fund balance that is not assigned towards the required reserve is referred to as “unassigned” fund balance. These unassigned funds can be used at the discretion of City Council. Table 3: General Fund balance for Fiscal Year-end 2020-21 & FY 2021-22 Year-end estimate Actuals (Unaudited) Beginning Unassigned Fund Balance at October 1, 2020 (based on FY 2019-20 audited CAFR)$18,229,563 $18,229,563 Plus revenues for FY 2020-21 59,051,732 61,708,698 Less unaudited year-end expenditures for FY 2020-21 (includes transfers out) -59,051,732 -58,933,884 Ending Fund Balance at June 30, 2021 18,229,563 21,004,377 Plus estimated revenues for FY 2021-22 74,802,700 74,802,700 Page 71 of 80 FYE 2020-21 Financial Review October 5, 2021 Page 8 of 11 Less estimated expenditures for FY 2021-22 (includes transfer out to CIP of $225,500)-77,651,553 -77,651,553 Transfer from the OPEB Trust 0 0 Estimated Ending Unassigned Fund Balance at June 30, 2022 15,380,710 18,155,524 20% General Fund Reserve -15,485,211 -15,485,211 Unassigned reserves for FY 2021-22 ($104,501)$2,670,313 Staff will bring the FY 2021-2022 mid-year financial review to City Council during the second City Council meeting in February. During the mid-year review, staff will present to Council strategic uses for the unassigned General Fund reserves estimated at $2.67 million that fall in line with the City’s adopted Strategic Plan, including fully funding the Economic Uncertainty Reserve that meets Council’s policy direction. The table below depicts the balance in the Economic Uncertainty Fund. Economic Uncertainty Reserve Fiscal Year FY 2020-21 FY 2021-22 Reserve Balance $1,076,296 $1,619,600 Reserve Policy $2,000,000 $2,000,000 Reserve Deficit -$923.704 -$380,500 DEBT SERVICE FUND The Debt Service fund records the City’s lease payments for the Douglas Street Gap Closure capital improvement project. In September 2005, the City entered into a facility lease agreement with California Infrastructure and Economic Development Bank (CIEDB) whereby CIEDB issued $10,000,000 in bonds to finance the Douglas Street Gap Closure Project. The City makes semi-annual lease payments over a 30-year period from Traffic Mitigation Fees which began in February 2006. The General Fund does not fund the debt service. The expenses were down compared to the adopted budget due to the principal and interest payment being made in July of each year and the nine-month FY 2020-21 Budget did not include July, however, the adopted budget did include the principal payment. Revenues from traffic mitigation funds, which are the source of revenue for the debt service payment, were higher than the budgeted revenue. Debt Service Fund Revenues Expenses FY 2020-21 Budget $137,000 $545,000 FY 2020-21 Actuals (unaudited)678,614 88,655 variance $541,614 $456,345 ENTERPRISE FUNDS Page 72 of 80 FYE 2020-21 Financial Review October 5, 2021 Page 9 of 11 The increase in water revenues is due to a new agreement between West Basin Municipal Water District, Chevron, and the City of El Segundo on the rate structure for recycled water use that Chevron is billed for, a year-end accounting accrual entry, and a general increase in residential and commercial demand due to continued drought conditions during FY 2020-21 and COVID-19 restrictions being eased and the reopening of local businesses. The expenses were up slightly accordingly compared to the budget. Water Fund Revenues Expenses FY 2020-21 Budget $18,285,000 $22,083,273 FY 2020-21 Actuals (unaudited) 24,864,269 22,349,936 variance $6,579,269 $(266,663) Wastewater Fund revenues were up slightly compared to the projected revenue due to the wastewater rate increase effective April 2, 2021. The expenses were down by $1.6 million compared to the budget due to decreased contractual services and repair/maintenance services for pending capital projects. Wastewater Fund Revenues Expenses FY 2020-21 Budget $3,110,000 $4,860,165 FY 2020-21 Actuals (unaudited) 3,298,349 3,282,822 variance $188,349 $1,577,343 Golf Fund The Golf fund year-end actual revenues were up compared to the projected revenues caused by the SCE license agreement with Top Golf. Expenses were $71,350 under the budget due to winding down the golf course and driving range operation in mid-February 2021 to begin breaking ground on the Topgolf project. Top Golf is expected to open operations in April/May 2022. Golf Fund Revenues Expenses FY 2020-21 Budget $802,000 $727,000 FY 2020-21 Actuals (unaudited) 1,098,917 655,650 variance $296,917 $71,350 INTERNAL SERVICE FUNDS Page 73 of 80 FYE 2020-21 Financial Review October 5, 2021 Page 10 of 11 General Liability Fund revenues were on budget as expected. Expenses were $951,349 above the budget mainly due to several large employment claims. General Liability Fund Revenues Expenses FY 2020-21 Budget $1,395,000 $1,619,399 FY 2020-21 Actuals (unaudited) 1,458,071 2,570,748 variance $62,171 $(951,349) Workers’ Compensation Fund revenues were slightly lower than budget due to lower interest allocation to the fund. The expenses were up by $1.3 million compared to the budget primarily due to an increase in claims associated with public safety personnel. Workers’ Compensation Fund Revenues Expenses FY 2020-21 Budget $2,910,924 $2,564,421 FY 2020-21 Actuals (unaudited) 2,601,079 3,856,140 variance $(309,845) $(1,291,719) SENIOR HOUSING FUND In 1986, the City constructed a 97-unit senior housing project, Park Vista. The City continues to own and maintain Park Vista. The property is overseen by the Senior Citizen Housing Corporation Board and managed by a third-party property management firm, The Cadman Group. The decrease in actual revenue compared to the projected revenue was caused by interest rate on the reserve balance of $1 million going down. The FY 2020-2021 Senior Housing Fund budget was $75,500, which included $60,000 for capital improvements. The expense variance was the net effect of postponed capital project and new part time personnel. Senior Housing Fund Revenues Expenses FY 2020-21 Budget $10,000 $75,500 FY 2020-21 Actuals (unaudited) 3,039 96,769 variance $(6,961) $(21,269) OTHER FUNDS The Adopted FY 2020-2021 Citywide Budget also includes a number of other Special Revenue Funds and Proprietary Funds not included in this unaudited year-end update. These funds will be included in the City’s official FY 2020-2021 Annual Financial Report Page 74 of 80 FYE 2020-21 Financial Review October 5, 2021 Page 11 of 11 which will be presented to City Council in December 2021. CONCLUSION: Balancing the FY 2020-2021 Budget was a major challenge since the fiscal year operated under a radically different scenario from previous fiscal years. While the organization was able to make the necessary adjustments to ensure that the General Fund and other major Funds ended the year in the black, considerable financial difficulties remain as the cost of providing services rise and the effects of COVID-19 continue to impact the local economy. The City will continue to focus its efforts on keeping local residents and businesses safe during an unprecedented global pandemic. Expenditures on employee retirement benefits will continue to rise as CalPERS continues to phase in a lower discount rate and a lower their investment risk tolerance for the CalPERS portfolio. In addition, medical premiums are seeing significant increases for 2022. Other budgetary pressures are the rising inflationary pressures on goods and services purchased by the City and the rising costs of construction materials. Page 75 of 80 City Council Agenda Statement Meeting Date: October 5, 2021 Agenda Heading: Staff Presentations Item Number: D.10 TITLE: League of California Cities Annual Conference Report - September 22-24, 2021 RECOMMENDATION: Receive and file report. FISCAL IMPACT: None BACKGROUND: The League of California Cities (Cal Cities) is an association of California cities that work together to enhance their knowledge and skills, exchange information, and combine resources to influence policy decisions that affect member cities, collectively and individually. Founded in 1898 on the principles of local control and interagency cooperation, Cal Cities has grown from a handful of cities to 482 incorporated cities from every location of California. The association’s mission statement is committed to "restore and protect local control for cities through education and advocacy to enhance the quality of life for all Californians.” Every fall, Cal Cities holds an annual conference to provide updates on timely and topic issues confronting cities throughout the State. The annual conference provides training opportunities, workshops, and networking for local elected officials and staff. The 2021 Cal Cities Annual Conference was held at the newly remodeled SAFE Credit Union Convention Center (formerly the Sacramento Convention Center) from October 22-24, 2021. The City of El Segundo attendees were: Councilmember Carol Pirsztuk, Councilmember Lance Giroux, City Manager Scott Mitnick, and Chief Financial Officer Joe Lillio. Page 76 of 80 League of CA Cities Report October 5, 2021 Page 2 of 5 DISCUSSION: The El Segundo team attended the following sessions/presentations/events: General Sessions: League of California Cities President Cheryl Viegas Walker- Mayor, City of El Centro: President Viegas Walker welcomed over 1,900 delegates and facilitated Opening General Session speakers and announcements. She introduced Sacramento Mayor Darrel Steinberg who did the official welcome to the conference city. Cal Cities Executive Director Carolyn Coleman addressed the membership on the recent passage of detrimental housing bills and mentioned that Cal Cities was developing a strategy to deal with the increasing loss of local control. A video montage of 2021 Helen Putnam Award nominees was featured. The 2021 Board of Directors nominees were also announced. National League of Cities Executive Director, Clarence Anthony thanked Cal Cities and its members for their support in advocating for American Rescue Plan Act funding to support cities during the COVID-19 pandemic. The 2021 Lifetime Achievement Award was presented to former San Francisco Mayor and California State Assembly Speaker Willie Brown. League of Cities 1st Vice President, Cindy Silva- Councilmember City of Walnut Creek introduced two awards categories: Cities of Workforce Health and Beacon Vanguard Awards for commitment in sustainability. Keynote Speakers: Bonnie St John- Courageous Humility: Leading with Resilience in Challenging Times: The former Para-Olympian downhill skier, Rhodes scholar, Fortune 500 executive, White House staffer to President Obama, and author shared her background and key practices of staying “micro resilient.” 1. Reframe attitude to be more positive. Create a personal first aid kit for attitude. The first aid kit includes items that will prompt shifts to positive attitude e.g. vacation souvenirs, thank you notes, chocolate, pictures of children. 2. Reset when you are experiencing primitive alarms. With stress, physiological reactions overrides logic. Blood pressure, tense muscles and headache are alarms. Reset by labeling what you are feeling and writing it down. 3. Renew your spirit. Identify the touchstone that bring it down to your values. Refuel your purpose. Page 77 of 80 League of CA Cities Report October 5, 2021 Page 3 of 5 Richard Montanez- One Revelation Will Lead to a Revolution: The inventor of “Flaming Hot Cheetos” shared his life story of an immigrant non-English speaking child growing up in a labor camp who finds a job without a formal education at the Frito Lay plant as a janitor. His discovery of a new snack idea led him to naively call Frito Lay CEO for a meeting. This meeting led to a to a successful career as a Pepsi executive and a $2 billion dollar grossing popular snack. He encouraged the audience to stay inspired, encouraged and mindful of personal values. Like his unorthodox path to success if you don’t to fit in, you will stand out. Conference Sessions Attended: Fiscal Officers Department Meeting National and State Economic Outlook Legal Issues: Social Media and Cannabis Neighborhood Law Programs: Gen. Revenue, Reduce Blight & Crime CalPERS Update: A Conversation with CEO Marcie Frost Tackling the Housing Crisis - Role of Local Leaders California Coastal Group Meeting Cybersecurity Risks & Cities: Strategies to Address Escalating Threats General Resolutions Committee Building and Online Community: Local Government Outreach Aging Infrastructure: Capital Improvement Plans for Cities of the Future Legal Issues: Land Use, CEQA and Surplus Land Act State and Local Roles in Building and Measuring Fiscal Resilience Short-Term Rentals: A Balanced Approach Workforce Housing Solutions - Innovative Trends Cannabis – Perceptions vs. Reality Closing Luncheon and General Assembly: Carolyn Coleman - State of the League of CA Cities: The Executive Director showed a video montage of Cal Cites 2021 accomplishments. The total membership has increased to 482 cities. Financially, the organization is in good shape. With less than a month before the Governor’s deadline to sign bills, lobbyists are working to advocate for key bills. Some accomplishments delivered this year: More funding for Project Homekey, Roomkey and homeless services. $70 million in the budget for low income housing. $4.5 billion for wildfire prevention and mitigation. Organic waste diversion funding to help cities meet their regulations. $6 billion for greater broadband access. Page 78 of 80 League of CA Cities Report October 5, 2021 Page 4 of 5 $8 billion in direct and flexible spending through American Rescue Plan Act and technical support to assist cities on how to use funding. 20 Amicus briefs filed to support local control Continued webinars and trainings New monthly departmental roundtable discussions Advancing Equity initiative Election of New Officers 2022 League of California Cities officers were installed and provided both outgoing and inaugural comments: Board President- Cindy Silva, Councilmember- City of Walnut Creek First Vice President- Ali Sajjad Taj, Councilmember-City of Artesia Second Vice President- Dan Parra, Councilmember- City of Fowler Immediate Past President – Cheryl Villegas Walker- City of El Cerrito General Assembly- Conference Resolutions The following bylaw changes and resolutions were discussed at the General Assembly/Annual Business meeting. Bylaw Amendments: 1. Adjust the composition of the Board to achieve a higher impact and be more representative by adding Director seats to the Board for each of the five Diversity Caucuses, and transitioning members of the National League of Cities Board from Cal Cities Directors to one non-voting advisor to the Cal Cities Board. 2. Recognize the Cal Cities Diversity Caucuses in the Cal Cities bylaws to reflect the full contribution the caucuses make to Cal Cities’ mission and vision. 3. Update the League of California Cities’ moniker to Cal Cities. The amendments passed with required 2/3rds vote. Resolution # 1- Online Sales Tax Equity Resolution of the League Of California Cities (“Cal Cities”) Calling on the State Legislature to Work with Cal Cities to Pass Legislation That Has First Been Developed and Vetted By City Officials and Put Forward By The Cal Cities Board Of Directors that Page 79 of 80 League of CA Cities Report October 5, 2021 Page 5 of 5 Provides for a fair and equitable distribution of the Bradley Burns 1% local sales tax from in-state online purchases, based on data where products are shipped to, and that rightfully takes into consideration the impacts that warehouses and fulfillment centers have on host cities, but also provides a fair share to California Cities that do not and/or cannot have such facilities within their jurisdiction. The resolution passed with referral to the 2022 Revenue and Tax Committee for further study. Resolution #2- Securing Railroad Property Maintenance Resolution calling upon the Governor and State Legislature to provide necessary funding for CUPC to fulfill its obligation to inspect railroad lines to ensure that operators are removing illegal dumping, graffiti, and homeless encampments that degrade the quality of life and results in increased public safety concerns for communities and neighborhoods that abut the railroad right-of-way. The resolution passed. CITY STRATEGIC PLAN COMPLIANCE: Goal 2. Support Community Safety and Preparedness Goal 4: Develop and Maintain Quality Infrastructure and Technology PREPARED BY: Scott Mitnick, City Manager REVIEWED BY: Scott Mitnick, City Manager APPROVED BY: ATTACHED SUPPORTING DOCUMENTS: None Page 80 of 80