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HomeMy WebLinkAboutPasco Public Facilities District (PPFD) - ILA for Admin., Financial, Legal and Op. Services of Aquatics CenterINTERLOCAL AGREEMENT between THE CITY OF PASCO, WASHINGTON and THE PASCO PUBLIC FACILITIES DISTRICT for ADMINISTRATIVE, FINANCIAL, LEGAL SERVICES, AND OPERATIONS OF AQUATICS CENTER This Interlocal Agreement ("Agreement") is made and entered into this day of - r 15 20261 by and between the City of Pasco, Washington, a municipal corporation of the state of ashington (the "City"), and the Pasco Public Facilities District, a municipal corporation of the state of Washington (the "District," and, together with the City, the "Parties"), and the Parties agree to the following terms: WHEREAS, the District was created pursuant to Chapter 35.57 of the Revised Code of Washington for the purposes of acquiring, constructing, operating and financing one or more regional centers through cooperative and joint ventures with one or more qualifying public facilities district; and WHEREAS, due to legislative changes in 2019 to RCW 35.57.020, the District became eligible to acquire, construct, own, remodel, maintain, equip, reequip, repair, finance, and operate one or more recreational facilities other than a ski area upon obtaining voter approval pursuant to RCW 82.14.048(4)(a). WHEREAS, in April of 2022, voters approved a 2/1oth of one percent sales tax increase to acquire, construct, own, remodel, maintain, equip, reequip, repair, finance, and operate an aquatics facility (the "Aquatics Center") pursuant to RCW 82.14.048(4)(a). WHEREAS, the District possesses, by law, all of the usual powers of a corporation for public purposes, as well as all other powers that may now or hereafter be specifically conferred by statute, including but not limited to the authority to hire employees, staff, and services, as well as to enter into contracts and agreements; and WHEREAS, the District desires to contract with the City for the purpose of securing those services necessary for fulfillment of the District's functions. NOW THEREFORE, in consideration of the mutual covenants contained herein, the Parties agree as follows: ARTICLE I PURPOSE The purpose of this Agreement is to create a cooperative basis upon which the District may utilize the personnel and obtain the services of the City needed to fulfill the District's statutory 2026 ILA — City of Pasco/District Administrative, Financial, Legal Services, and Operations of Aquatics Center- 1 functions and to provide the basis of compensation to the City for such services for the management and operation of the District's the voter -approved Aquatics Center. ARTICLE II SERVICES PROVIDED BY THE CITY Section 2.1. General. The management and operational and administrative services required by the District under this Agreement for the Aquatics Center will be provided by City employees in the Parks, Recreation and Facilities Division of the City's Administrative and Community Services Department. The City Manager, or their designee, shall serve as the primary liaison between the City and the District. Other City officials, employees, or agents may provide specific or specialized services as may be necessary. At all times under this Agreement, the District will remain the owner of the Aquatics Center. Section 2.2. Administrative, Financial and Legal Services. The City shall provide, at the request of the District, the following services: (a) City Clerk. The City Clerk shall serve as the ex officio secretary of the Board of Directors (the "Board") of the District for purpose of receipt of claims, providing notices of public meetings of the Board required by the Washington Open Public Meetings Act (RCW 42.30), repository of official records of the District, keeping and maintaining minutes of Board meetings (including recorded records), and providing for the public inspection and copying of such records in accordance with the policies and Municipal Code of the City and the applicable requirements of the Washington Public Records Act (RCW 42.56). The City Clerk or their designee also shall provide other support services to the District, including providing meeting space for Board meetings, agenda coordination, advertisement, general correspondence with Board members, and public records management, maintenance and storage. (b) City Attorney. The City Attorney may provide legal services for the District, but the District also may contract with outside counsel for legal services. (c) Senior City Staff Support. The City Manager, and their designee(s) shall provide support services to the District in the following general areas: i. General coordination between members of the District Board and staff with the City Council and City staff, ii. Staff liaison support to the District Executive Director, iii. Staff support for all City -led efforts outlined herein, iv. Coordination of real estate transactions, V. Coordination of applicable interlocal agreements, and vi. Development of policy (d) City Finance Director. The City Finance Director, or their designee, shall serve as the financial officer for the District, whose duties will include preparing quarterly and annual financial 2026 ILA — City of Pasco/District Administrative, Financial, Legal Services, and Operations of Aquatics Center- 2 reports, including claims, revenue and expense reports, and performing all accounts payable and receivable functions. Section 2.3. Aquatics Center Operational Services. The City will be responsible for overall management and operation of the Aquatics Center, while the Board will provide general oversight and ensure the alignment of the Aquatics Center's operations with the voter -approved goals and funding of the Aquatics Center. (a) General Operations. The City will provide regular reporting to the District to ensure effective management and operation of the Aquatics Center. Reports will be made available on a monthly, quarterly, and annual basis, as appropriate, including: i Financial Reports: Detailed expense reporting, revenue reports, Profit and Loss (P&L) statements, and budget vs. actual comparisons. ii. Attendance and Usage Metrics: Daily attendance, capacity utilization, membership enrollment, program participation, and special events attendance. iii. Customer Feedback and Satisfaction: Customer satisfaction surveys and complaints log. iv. Maintenance and Facility Management Reports: Maintenance logs, equipment replacement schedules, facility condition assessments, work order completion rates, and energy efficiency reporting. V. Safety and Risk Management Reports: Incident and accident reports, emergency drills, and compliance reports. vi. Programming Success Metrics: Program effectiveness, new program development, and revenue vs. cost analysis for programs. vii. Staffing Reports: Staffing levels, training and certifications, and staff performance evaluations. viii. Marketing and Outreach Reports: Effectiveness of marketing campaigns and community engagement. ix. Concession and Retail Reports: Concession stand revenue, cost of goods sold (COGS), and retail sales reports. X. Sustainability and Environmental Impact Reports: Water and energy usage reports, and waste reduction metrics. xi. Sponsorship and Community Benefit Reporting: Sponsorship success and community impact reporting. xii. Benchmarking and Competitive Analysis: Comparative analysis of performance metrics against regional and national aquatics centers. (b) Facilities Maintenance Policy. In order to assist and provide clear direction to the City in its provision of maintenance services with respect to the property and facilities comprising the Aquatics Center, the City and the District shall jointly develop a specific facilities and equipment maintenance policy ("maintenance policy") for the Aquatics Center, subject to final approval by the District's Board. The maintenance policy shall include specific maintenance, repair and safety procedures and standards for the facilities and equipment comprising the Aquatics Center. Those procedures and standards shall be comparable to 2026 ILA — City of Pasco/District Administrative, Financial, Legal Services, and Operations of Aquatics Center- 3 procedures and standards that are customary for other aquatics centers of similar size and character to the District's Aquatics Center. ARTICLE III COMPENSATION FOR CITY SERVICES Section 3.1. Annual Operating Budgets. On or before November 1 of each year, the City shall provide the District with a proposed operating budget for the Aquatics Center for the succeeding calendar year. The District shall adopt a final budget for the Aquatics Center by December 31 of each year. The Parties will cooperatively develop an initial operating budget for the partial calendar year of 2026, which shall be presented to the District's Board for revision and adoption by May 1, 2026. Each budget shall be based on the types and extent of aquatics programs and activities to be offered at the Aquatics Center and the estimated costs and expenses of the City's services needed to carry out those programs and activities. Each budget shall include a general list of the various services to be provided by the City. The specific levels of programming (e.g., hours of operation, adult versus free swim schedule, classes, swim meets, etc.) shall be determined at least on an annual basis by a collaborative process between the District and the City and formalized in the budget adopted pursuant to this Agreement. Section 3.2. City Compensation Based on Cost of Service. The District shall compensate the City on a cost -of -service basis for "direct billable costs" of services provided and expenses incurred by the City that are solely attributable to the operation of the Aquatics Center. These "district billable costs" are listed and described below. The District also shall compensate the City on a cost -of -service basis for a proportionate share of "indirect billable costs" of services provided and expenses incurred by the City that benefit both the Aquatics Center and the City's departments and operations unrelated to the Aquatics Center. These "indirect billable costs" also are listed and described below. Section 3.3. Direct Billable Costs. Direct billable costs shall be those expenses incurred by the City that are solely attributable to the operation of the Aquatics Center. The following expenses shall be treated as direct billable costs and will be directly billed to the District for the operation of the Aquatics Center: All Staffing: Lifeguards, instructors, facility manager, supervisors, customer service staff, and cashier staff, technical, grounds and maintenance, human resources, recreation, finance, and communications, or other required city staff. Aquatics Center Operating Schedule: Costs related to maintaining the Aquatics Center's annual, seasonal, and daily operating hours. Aquatics Center Programming: Swim lessons, fitness programs, lap swim, open swim, private bookings, and special events. Technology: Software, network infrastructure, computers, printers, point -of -sale systems, access control, security cameras, fire and security monitoring. 2026 ILA — City of Pasco/District Administrative, Financial, Legal Services, and Operations of Aquatics Center- 4 Marketing and Advertising: Website maintenance, social media management, print ads, radio/TV spots, promotions, branding, and community outreach. Sponsorship and Promotions: Development and management of sponsorship deals and promotional events. Operational Plans, Policies, and Rules: Creation, maintenance, and enforcement of facility operational policies. Concessions Management: Managing and operating concession stands within the facility. Maintenance and Repair: Routine and emergency repairs for facility equipment and infrastructure. Janitorial and Cleaning Services: Costs related to cleaning services to maintain the facility. Landscape Services: Exterior maintenance, including landscaping, gardening, and outdoor facility upkeep. Chemicals and Supplies: Pool chemicals, cleaning supplies, and other operational materials. Operating Permits and Inspections: Costs for obtaining required permits and passing routine inspections. Utilities: Electricity, water, heating, cooling, and other necessary utilities. Equipment: Costs for the purchase and maintenance of necessary equipment for operations. Insurance: Coverage for the facility and its operations. Safety and Risk Management Costs: Regular safety audits, inspections, first aid supplies, AEDs, safety drills, and incident response training for staff. Facility -Specific Licensing Fees: Licenses required for specific activities (e.g., swim competitions), and fees for regulatory compliance. Guest Services & Amenities: Locker room supplies (towels, toiletries) and additional guest services such as towel and locker rentals. Water Quality Management: Water testing, filtration systems, and water treatment. 2026 ILA — City of Pasco/District Administrative, Financial, Legal Services, and Operations of Aquatics Center- 5 Aquatics Facility Furnishings & Fixtures: Poolside furniture, lane dividers, safety ropes, signage, and other specialty items for programming. Professional Services: Contracted services such as professional divers for inspections or legal services related to operations. Capital Reserve Fund Contributions: Funds set aside for future capital improvements or significant repairs. Risk and Liability Insurance for Events: Additional insurance coverage for special events or competitions. Security and Access Control: Installation and maintenance of security systems such as remote surveillance or access control. Sustainability Initiatives: Costs for energy -saving measures such as solar panels or water conservation systems. On a monthly basis the City shall charge to the District and the District shall pay to the City for direct billable costs for the provisions of the foregoing services. City Attorney services (if utilized by the District) rendered for the District shall be charged in addition to the above monthly charge and billed separately. Section 3.4. Indirect Billable Costs. Indirect billable costs shall be those expenses incurred by the City for the operation of the Aquatics Center that are not treated as direct billable costs under Section 3.3, and which are shared proportionately between the Aquatics Center and other City operations consistent with the City's then -effective cost allocation policy and model. The following expenses shall be treated as indirect billable costs to be proportionately shared between the District and the City for services or operational costs incurred for both the Aquatics Center and other City operations: General Overhead Allocation: Share of city-wide administrative costs such as City Manager's oversight, HR management, and public records compliance not otherwise related to services provided in Article II of this Agreement. IT Services Fee: Costs for centralized IT infrastructure, maintenance, software licenses, cybersecurity, and technical support. Fleet Management Fees: Shared costs for vehicle maintenance, fuel, and repairs for vehicles used by the Aquatics Center. Purchasing and Procurement Services: Costs for acquiring goods and services for the Aquatics Center, and contract management. 2026 ILA — City of Pasco/District Administrative, Financial, Legal Services, and Operations of Aquatics Center- 6 Risk Management and Liability Claims Administration: Shared costs for workers' compensation, liability insurance, and risk mitigation. Finance Department Services: Costs for centralized accounting, payroll processing, budgeting, and audit compliance. Permit and Licensing Fees: Internal fees for special permits and licenses related to the facility's operation and events. Communications and Public Relations Fees: Costs for public relations and communications efforts related to facility promotion and media relations not covered by direct billable costs. Emergency Preparedness and Disaster Recovery: Shared costs for city-wide emergency management services, including disaster recovery planning. Strategic Planning and Economic Development: Proportionate share of planning and economic development costs that benefit the Aquatics Center. Records Management: Costs for document storage, archiving, and responding to public records requests related to facility operations. On a monthly basis the City shall charge to the District and the District shall pay to the City for indirect billable costs for the provisions of the foregoing services. Section 3.5. Semi -Annual True -Up of Operating Expenses. The City and the District recognize that the actual costs incurred by the City to operate and manage the Aquatics Center may be more than or less than the costs anticipated in the annual operating budget of the Aquatics Center jointly developed by City and the District. In July and January of each year, adjustments shall be made to the amount of compensation payable by the District to the City for management, operation and maintenance services provided by the City in the previous six months. These adjustments shall reconcile or "true -up" compensation with actual incurred costs of the City for those services in that prior year. If the amount paid by the District to the City varies from the amount found to have been due for the prior calendar year, the District will adjust its payments to the City in the current calendar year by adding or crediting the overpayment or underpayment amount to remaining District payments for the current calendar year, by disbursing or billing the overpaid or underpaid amount as a lump sum or invoice, or by some other payment adjustment method agreed to by the City and the District. A reconciliation process involving City Staff and the Budget and Finance Committee of the District will be utilized to review all actual costs are accounted for and allocated appropriately. Section 3.6. Joint Development of an Aquatics Center Capital Improvement Plan. The City and the District acknowledge that future additions and improvements to the Aquatics Center may change (increase or decrease) the character and amounts of operating and maintenance expenses required to operate and maintain the Aquatics Center. Therefore, the City and the District shall 2026 ILA — City of Pasco/District Administrative, Financial, Legal Services, and Operations of Aquatics Center- 7 jointly develop a capital improvement plan ("CIP") for the Aquatics Center, subject to final approval by the District's Board. The CIP shall include: • A listing of potential future capital additions and improvements to the Aquatics Center that would enhance the District's ability to carry out aquatics programs and activities for the community; • Anticipated sources of District funding for those capital improvements, including proceeds of additional District parity bonds to the extent permitted to be issued under District Resolution No. 2024-09; District sales tax revenue and operating revenue; and grants, gifts and other available District sources; and • Projections of the additional management and operational and administrative expenses reasonably expected to be associated with the new additions and improvements to the Aquatics Center that will be incurred by the City, together with the sources of District funding reasonably expected to be available to meet those additional expenses. Section 3.7. Joint Development of Aquatics Center Renewal and Replacement Reserve Policy. The City and the District also acknowledge that the establishment and maintenance of healthy renewal and replacement reserves for the property and facilities comprising the Aquatics Center will assist both Parties in managing future operating and maintenance expenses required to operate and maintain the Aquatics Center. Therefore, the City and the District also shall jointly develop a renewal and replacement ("R&R") reserve policy for the Aquatics Center, subject to final approval by the District's Board. The R&R reserve policy shall include, among other things: • An inventory of the various types of existing facilities and equipment required for the operation of the Aquatics Center and schedules of the respective estimated useful lives of those facilities and items of equipment; and • A financial plan under which the District will accumulate District sales tax revenue and operating revenue that is available after the District's required debt service payments and required payments to the City under the Agreement to establish and maintain an R&R reserve in amounts sufficient to provide for the repair and/or replacement of those facilities and items of equipment at the end of their respective useful lives. ARTICLE IV INTERLOCAL COOPERATION ACT PROVISIONS The District shall be solely responsible for all costs, materials, supplies and services necessary for its performance under the terms of this Agreement. All property and materials secured by the District in the performance of this Agreement shall remain the sole property of the District. All funding incident to the fulfillment of this Agreement, shall be borne by the party necessary for the fulfillment of their responsibilities under the terms of this Agreement. No special budgets or funds are anticipated, nor shall be created incident to this Agreement. It is not the intention that a separate legal entity be established to conduct the cooperative undertakings, nor is the acquisition, holding, or disposition of any real or personal property anticipated under the specific terms of this Agreement. The District shall adopt and follow City policies and procedures 2026 ILA — City of Pasco/District Administrative, Financial, Legal Services, and Operations of Aquatics Center- 8 when deemed efficient and in compliance with applicable regulations. The City Manager and the District's Executive Director shall be designated as Co -Administrators of this Agreement. ARTICLE V INITIAL TERM, RENEWAL AND TERMINATION OF AGREEMENT The initial term of this Agreement shall commence on the date this Agreement is mutually executed and delivered, and shall continue until December 31, 2028. The term of this Agreement shall be automatically renewed for one-year periods thereafter unless either the City or the District provides, at least twelve (12) months prior to the end of that current term of this Agreement, written notice to the other Party of its intention not to renew the Agreement at the end of its current original or renewal term. ARTICLE VI INSURANCE AND LIABILITY Section 6.1. Provisions for Insurance. The District and the City each shall obtain and maintain insurance, or risk pool self-insurance insurance, for their respective acts and omissions under this Agreement, and as otherwise customarily provided in connection with the governmental ownership and operation of aquatic facilities comparable to the District's Aquatics Center. Among other types of insurance coverages that may be appropriate for governmentally -owned aquatics centers comparable in size and character to the District's Aquatics Center, the following insurance coverages shall be obtained and maintained: • The District shall insure, at replacement cost value, the buildings, facilities and equipment comprising the Aquatics Center under appropriate policies of "all-risk" casualty insurance; • The District and the City each shall maintain General Liability insurance, or risk pool self-insurance, for Bodily Injury, Property Damage Liability, Public Officials Errors and Omissions and Automobile Liability in specified minimum amounts customarily provided in connection with the ownership and operation of aquatic facilities comparable to the District's Aquatics Center. • The City shall maintain Workers Compensation insurance as required by state statute and federal law if applicable. Section 6.2. Indemnification Provisions. The District and the City shall defend, indemnify and hold the other Party, its officers, officials, employees and volunteers harmless from any and all claims, injuries, damages, losses or suits including attorney fees, arising out of or resulting from the acts, errors or omissions of the indemnifying Party in performance of this Agreement, except for injuries and damages caused by the sole negligence of the indemnified Party. These indemnification provisions shall be reviewed and revised as necessary by counsel for the District and the City to ensure compliance with applicable provisions of state law, as well as by the Washington Cities Insurance Authority to the extent the City obtains and maintains risk pool self- insurance from that Authority for the purposes of the Agreement. 2026 ILA — City of Pasco/District Administrative, Financial, Legal Services, and Operations of Aquatics Center- 9 ARTICLE VII ENTIRE AGREEMENT This Agreement contains all the terms and conditions agreed upon by the Parties. No other understandings, verbal or otherwise, in regard to the subject matter of this Agreement, shall be deemed to exist. Any modifications to this Agreement shall be in writing and signed by both Parties to be effective. ARTICLE VIII APPLICABLE LAW This Agreement is governed, construed and enforced in accordance with the substantive laws of the State of Washington. Should any dispute arise concerning the enforcement, breach, or interpretation of this Agreement, venue shall be placed in Franklin County, Washington, and the prevailing party shall be entitled to its reasonable attorney fees and costs as additional judgment. ARTICLE IX AUTHORITY FOR EXECUTION Each of the Parties warrants and represents that its representatives, whose signatures are below, possess all required authority to sign this Agreement and such powers have not, as of the date of this Agreement, been revoked or revised. IN WITNESS WHEREOF, the Parties have executed this Agreement by the duly authorized officers on the day and year first written above. PASCO PUBLIC FACILITIES DISTRICT By: a Ma fk Morissett , Chair Attested to by: Krystle Shanks, CMC, City Clerk CITY OF PASCO By: HarolcrL. Stewart, II, City Manager 2026 ILA — City of Pasco/District Administrative, Financial, Legal Services, and Operations of Aquatics Center- 10