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HomeMy WebLinkAbout2015.01.12 Council Workshop PacketAGENDA PASCO CITY COUNCIL Workshop Meeting 7:00 p.m. January 12, 2015 1. CALL TO ORDER 2. ROLL CALL: (a) Pledge of Allegiance. 3. VERBAL REPORTS FROM COUNCILMEMBERS: 4. ITEMS FOR DISCUSSION: (a) Waiver of Sewer Utility Service Requirement (ME# USW 2014-004): 1. Agenda Report from Rick White, Community & Economic Development Director dated January 6, 2015. 2. Sewer Waiver - Vicinity Map. 3. Sewer Waiver -Overview Map. 4. Sewer Waiver -Proposed Utility Service Waiver Agreement. (b) Annexation RD 80 Area: 1. Agenda Report from Rick White, Community & Economic Development Director dated January 7, 2015. 2. Annexation RD 80 Area - Boundary Map. 3. Annexation RD 80 Area - Vicinity Map. (c) Certified Local Government Agreement (MF# PLAN 2014-001): 1. Agenda Report from Jeffrey B. Adams, Associate Planner dated January 7, 2015. 2. Certified Local Government - 2015 Agreement. (d) HOME Consortium Subrecipient Agreements for 2014 Administration and Down Payment Assistance (DPA): 1. Agenda Report from Angela R. Pitman, Block Grant Administrator dated January 5, 2015. 2. Proposed Resolution. 3. Subrecipient Agreements for Down Payment Assistance and Administration. (e) Argent Road Widening Professional Services Agreement - Amendment No. 1: 1. Agenda Report from Ahmad Qayoumi, Public Works Director dated January 7, 2015. 2. Argent Road Widening - Amendment No. 1 Summary Sheet. 3. Argent Road Widening - Area Vicinity Map. 4. Argent Road Widening -Argent Rd/Rd 36 Intersection Map. (f) 9th & Washington Lift Station VFD Equipment: I . Agenda Report from Kent McCue, Interim Engineering Manager dated January 8, 2015. 2. 9h & Washington VFD Equipment - Proposed Resolution. 3. 9h & Washington VFD Equipment - Price Quote. 4. 9th & Washington VFD Equipment -Memo. 5. 9h & Washington VFD Equipment - Vicinity Map. (g) Canter Club Estates Latecomers Agreement: 1. Agenda Report from Kent McCue, Interim Engineering Manager dated January 8, 2015. 2. Canter Club Estates - Proposed Agreement. 3. Canter Club Estates - Memorandum from Michael A. Pawlak, PE, City Engineer. (h) Gesa Stadium Upgrades: 1. Agenda Report from Rick Terway, Administrative & Community Services Director dated January 7, 2015. 2. Gesa Stadium Upgrades - Amendment # 2. 3. Gesa Stadium Upgrades - Section 6.3. 5. OTHER ITEMS FOR (a) (b) (e) 6. EXECUTIVE SESSION: (a) (b) (c) Workshop Meeting 2 January 12, 2015 7. ADJOURNMENT REMINDERS: 1. 6:00 p.m., Monday, January 12, Conference Room #1 — Old Fire Pension Board Meeting (COUNCILMEMBER REBECCA FRANCIK, Rep.; SAUL MARTINEZ, Alt.) 2. 3:30 p.m., Wednesday, January 15, FCEM Office — Franklin County Emergency Management Board Meeting. (MAYOR MATT WATKINS, Rep.; COUNCILMEMBER TOM LARSEN, Alt.) AGENDA REPORT FOR: City Council January 6, 2015 TO: Dave Zabell, City Manager Workshop Mtg.: 1/12/2015 Regular Mtg.: 1/20/2015 FROM: Rick White, 1--7 Community & Economic Development Director 0 SUBJECT: Waiver of Sewer Utility Service Requirement (MF# USW 2014-004 I. REFERENCE(s): 1. Sewer Waiver — Vicinity Map 2. Sewer Waiver — Overview Map 3. Sewer Waiver — Proposed Utility Service Waiver Agreement II. ACTION REQUESTED OF COUNCIL/STAFF RECOMMENDATIONS: 1/12: 1/20: MOTION: I move to conditionally approve the sewer utility service waiver at 1209 Road 62 and authorize the City Manager to execute the waiver agreement. III. FISCAL IMPACT: None IV. HISTORY AND FACTS BRIEF: A. The applicant has applied for a utility service waiver to install a septic system for new construction of a single family dwelling at 1209 Road 62 on an existing lot. PMC 16.06 requires connection to the utility system when a building permit is issued unless such requirement is waived by action of City Council. B. Utility waivers are granted/denied by City Council in accord with the requirements of PMC 16.06.050. This section of the PMC requires that City Council base their decision on the following criteria: • Special circumstances applicable to the property in question or the intended use that do not generally apply to either properties or classes of uses in the same vicinity or zoning classification. • A waiver is necessary for the preservation and enjoyment of a substantial property right or use possessed by other properties in the same vicinity and same zoning classification, which because of special circumstances is denied to the property in question. • The granting. of the waiver will not be detrimental to the public welfare or egregious to other property improvements in such vicinity and zoning classification, which the subject property is located. • The granting of a waiver will not conflict with the general intent of this chapter. C. The above criteria contained in PMC 16.06.050 is established to measure unusual or unique circumstances peculiar to a certain property that would justify waiver of a requirement for utility connections similar to the way a land use variance would be evaluated. M J V. DISCUSSION: A. Presently, the nearest existing sewer line is approximately 389 feet from the applicant's property and it is not cost effective for a private party or the City to provide for the extension of such line at this time. B. Single family homes in this vicinity have been developed with septic systems on roughly two -acre lots. The subject site was recently created by dividing one approximately two -acre parcel while under city jurisdiction. A local improvement district to extend sewer to this part of Pasco is not likely in the near future due do the existing development pattern in the area. C. Standards for septic systems are administered through the Benton Franklin Health Department and will apply to the installation of septic systems on this property. It is not expected that the waiver will be detrimental to public health or welfare in this vicinity. D. The granting of a waiver will not conflict with the intent of Chapter 16.06 of the PMC. The significant costs associated with sewer line extension and the unlikelihood of a local improvement district in the near future leads staff to recommend that a sewer connection waiver be granted for the property. Vicinity Item: Sewer Waiver Ma Applicant: Muhlbeier N Map File #: USW2014-004 d Y.. b co r+. I ` ,7 �. AFA I F' ........... 4K O AFA I F' ........... 4K WHEN RECORDED RETURN TO: City of Pasco, Washington Engineering Department 525 North 3rd Avenue Pasco, WA 99301 UTILITY SERVICE WAIVER AGREEMENT (CHAPTER 16.06 PMC) 1) The undersigned is the owner of the real property situated in Franklin County, Washington addressed as 1209 Road 62 and described as: Tax Parcel (parent) #: 119-651-085 Legal: Lot 2, Short Plat 2014-38, according to the Plat thereof recorded in Volume 1 of Plats Page 987, records of Franklin County Auditor's Office, Washington 2) The undersigned has made application for waiver of the utility service requirements of Chapter 16.06 PMC and the Pasco City Council has by motion approved said waiver based on the following Findings: a) Presently, there is no sewer service provided near the property. The nearest existing sewer line is approximately 389 feet from the applicant's property and it is not cost effective for a private party or the City to provide for the extension of such line. b) Standards for septic systems are administered through the Benton Franklin Health Department and will apply to the installation of septic systems on this property. It is not expected that the waiver will be detrimental to public health or welfare in this vicinity; c) Single family homes in this vicinity have been developed with septic systems on roughly two acre lots. The subject site was recently created by dividing one approximately two -acre parcel. A local improvement district to extend sewer to this part of Pasco is not likely in the near future due do the existing development pattern in the area; d) The granting of a waiver will not conflict with the intent of Chapter 16.06 of the PMC. The significant costs associated with sewer line extension, the timeframe expected for the provision of infrastructure to allow the area to be served by city sewer, and the unlikelihood of a local improvement district in the near future support the granting of a waiver for connection to the city sewer system for the property. UTILITY SERVICE WAIVER AGREEMENT (MF# USW2014-004) In consideration of the mutual covenants contained herein, the sufficiency of which are hereby acknowledged, the parties agree as follows: 3) The City waives connect of the above described property to the City sanitary sewer system prior to granting of a development permit as required by PMC 16.06.010 until such time as the utility services are available as defined in PMC 16.06.010 or the basis for the waiver as provided in PMC 16.06.050 ceases to exist. 4) The waiver is conditioned upon the undersigned making the following agreements and acknowledgments with the City, which the undersigned does hereby freely and voluntarily make: a) The undersigned agrees to provide the City of Pasco with all necessary Health District approvals for the use of a septic tank system at the above referenced property; b) The undersigned acknowledges that the granting of a sewer utility waiver does not exempt him/her from any obligation that results from the formation of a Local Improvement District to provide sanitary sewer and water to the undersigned's property; c) The owners jointly and severally hereby (1) make, constitute and appoint the City as the owners' true and lawful attorney in fact for them in their name, place and stead and as an irrevocable proxy to sign a petition for the formation of a local improvement district or utility local improvement district ("LID") hereafter to be formed by the City or its successors for the improvement that will provide utilities available for the benefit of the real property describe above and (2) waive their right under RCW 35.43.180 to protest formation of such LID for such improvements. The property owners reserve and retain the right to object to the amount of the LID assessment levied against the property and to appeal that assessment to the Franklin County Superior Court; d) The undersigned shall pay an equitable share of any private sewer utility extensions abutting the undersigned's property; e) This Agreement shall be a conveyance of an irrevocable interest in land and the owners do by these presents convey to the City such limited interest in the property. The above covenants to the City shall run with the land and be binding on the owner, on the undersigned, his/her heirs, devisees, successors and assigns and all owners now or hereafter of the land above described, or of any of said land described above; f) A violation of any of the above covenants may be enjoined and the same enforced at the suit of the City with attorney fees awarded to the substantially prevailing party, g) The owners do hereby warrant that the persons named as "property owner" on the signature lines below are all of the persons or entities having any interest in the property and that they have full power to execute this Agreement. UTILITY SERVICE WAIVER AGREEMENT (MF# USW2014-004) This utility waiver and agreement has been approved by the Pasco City Council on day of 20 Signature of Legal Property Owner(s) STATE OF WASHINGTON ) ss. County of Franklin On this day personally appeared before me , to be known to be the individual(s) described in and who executed the within and foregoing instrument, and acknowledged that they signed the same as their free and voluntary act and deed for the uses and purposes therein mentioned. GIVEN under my hand and official seal this day of , 20_ NOTARY PUBLIC in and for the State of Washington Residing at: My Commission Expires: Signature of Legal Property Owner(s) STATE OF WASHINGTON ) ss. County of Franklin On this day personally appeared before me , to be known to be the individual(s) described in and who executed the within and foregoing instrument, and acknowledged that they signed the same as their free and voluntary act and deed for the uses and purposes therein mentioned. GIVEN under my hand and official seal this day of 20_. NOTARY PUBLIC in and for the State of Washington Residing at: My Commission Expires: UTILITY SERVICE WAIVER AGREEMENT (MF# USW2014-004) .............................................. a ...................... ..MENS.... This utility service waiver and agreement has been approved by the Pasco City Council on _ day of 20_ Dave Zabell, City Manager STATE OF WASHINGTON ) ss. County of Franklin ) On this day personally appeared before me, Dave Zabell, City Manager, to be known to be the individual(s) described in and who executed the within and foregoing instrument, and acknowledged that they signed the same as their free and voluntary act and deed for the uses and purposes therein mentioned. GIVEN under my hand and official seal this day of 20_. NOTARY PUBLIC in and for the State of Washington Residing at: My Commission Expires: UTILITY SERVICE WAIVER AGREEMENT (MF# USW2014-004) AGENDA REPORT FOR: City Council January 7, 2015 ++"-_- Workshop Mtg.: 1/20/15 TO: Dave Zabell, City Manager n� Regular Mtg.: 1/12/15 FROM: Rick White, Community & Economic Development Director SUBJECT: Annexation RD 80 Area I. REFERENCE(S): 1. Annexation RD 80 Area - Boundary Map 2. Annexation RD 80 Area— Vicinity Map II. ACTION REQUESTED OF COUNCH./STAFF RECOMMENDATIONS: 1/12: DISCUSSION 1/20: MOTION: I move to authorize staff to initiate formation of an ad hoc citizen committee to analyze the impact of annexation on properties in the RD 80 Area. III. FISCAL IMPACT: IV. HISTORY AND FACTS BRIEF: A. With City and County approval, the Pasco Urban Growth Area (UGA) was adopted in 1995 and joint zoning standards were adopted in 1999. The UGA serves as an important tool for effective capital investment and financial planning. The City relies on this boundary to make investments in water and sewer plants and facilities, fire stations, parks and road maintenance operations and equipment. An example of such a capital investment for eventual use in the Riverview unincorporated island is the City's Fire Station on Road 68 just north of Argent. B. The City has also installed utility and transportation infrastructure to serve the entire UGA. When City water service (and recently sewer service) has been extended to properties outside the City limits but within the UGA, the extension has been conditioned on agreements (binding on successor owners), granting the City the power of attorney to sign a future annexation petition on behalf of the property owner. C. Through the accumulation of outside utility agreements/powers of attorney over several years, the boundaries of a potential annexation area west of RD 80 have been identified and annexation of this area is now possible. D. Though challenged by a group of "donut hole" residents, a ballot issue in November 2013 resulted in city voters (and in excess of 60% of the annexed area voters) confirming that Annexation Area #2 should remain part of Pasco. E. Council adopted Resolution 3552 in May of 2014 expressing Council goals for calendar years 2014 — 2015. Goal #11 of that Resolution express the City's goal to reduce the size of the unincorporated "donut hole" through continued orderly annexation. V. DISCUSSION A. The RD 80 area as shown on Reference #1 is that portion of Pasco's UGA that is not yet incorporated but is able to be annexed through the use of outside utility agreements/powers of attorney. It has an assessed value of approximately $156,700,000, is surrounded by City limits and City utilities extend to much of the area. RD 80 Area residents use City streets for access to their homes and businesses, City police continually drive through this area while on patrol, and residents participate in City recreational programs and use City parks. 4(b) B. An important part of paying for these services and facilities is property tax the City receives. County residents do not contribute payment of property tax for use by the City, and fees and charges for services are often not set to recover their full cost. C. Potential annexation of the RD 80 Area would result in increased revenues from property and utility taxes and State shared revenue. There would be loss of revenue from the surcharge on water and an overall (although moderate) increase of expenditures for governmental service (police, fire and general government). D. Formation and use of a citizen committee to analyze impacts to properties and residents of any potential annexation area is seen as an important step to objectively identify (by citizens not necessarily staff) positive or negative impacts of annexation. Such a citizen committee was formed and used for that purpose in conjunction with the Area #2 Annexation in late 2012. Staff requests Council concurrence to solicit members for such a committee with the intent of providing the Mayor a list of potential candidates for appointment. E. This activity is predicated on Council's willingness to proceed with an annexation process for this area with conclusion of such a process before August of this year. Staff would benefit from Council discussion and direction on this issue. AGENDA REPORT FOR: City Council January 7, 2015 TO: Dave Zabell, City Manager/5 Workshop Mtg.: 1/12/15 Rick White, Regular Meeting: 1/20/15 Community & Economic Development Dire ctor,44 FROM: Jeffrey B. Adams, Associate Planner SUBJECT: Certified Local Government Agreement (MF# PLAN 2014-001) I. REFERENCE(S)- 1. Certified Local Government— 2015 Agreement II. ACTION REQUESTED OF COUNCIL / STAFF RECOMMENDATIONS: 1/12: DISCUSSION 1/20: MOTION: I move to approve the Certified Local Government Agreement with the Washington State Department of Archaeology and Historic Preservation (DAHP), and, finther, authorize the Mayor to execute the agreement. III. FISCAL IMPACT: None IV. HISTORY AND FACTS BRIEF: A. One of Council's 2012-2013 goals was to "assist the Historic Preservation Commission :with the development of a Historic Preservation Plan for the City." In November of 2013 the City approved a Historic Preservation Work Plan (Resolution 3521), which includes an action item to obtain approval as a Certified Local Government (CLG). B. City Council approved an amended Title 27 Historic Preservation (Ordinance 4178) in October 2014 in partial fulfilment of the CLG application requirements. The Historic Preservation Commission subsequently updated its Bylaws to align with the revised Ordinance. C. Finally, City Planning staff submitted Commissioner and staff resumes, along with a letter detailing the City's HPC recruitment efforts to the Washington State Department of Archaeology and Historic Preservation (DAHP) to complete the Certified Local Government application. V. DISCUSSION: A. Local governments that establish a historic preservation program which meets federal and state standards are eligible to apply to the State Historic Preservation Officer (SHPO) and the National Park Service for certification. A local government that receives such certification is known as a "Certified Local Government." B. Benefits of participating in the program include eligibility to apply for special grants from the State Historic Preservation Office (SHPO), authority to offer Special Tax Valuation to locally listed properties, technical assistance and training from the SHPO, access to the national historic preservation. assistance network, and to the State Historic Preservation Office data exchange. CLGs are expected to maintain a historic preservation commission, maintain a survey of local historic properties, enforce local preservation laws, review National Register Nominations, and engage the public in historic preservation activities. C. Among the requirements for CLG status are passage of a Historic Preservation Ordinance, adoption of a Historic Preservation Commission with qualified commissioners, and adoption of HPC Bylaws. 4(c) D. Staff has guided these efforts through the HPC and City Council, and the Department of Archaeology and Historic Preservation has accepted the application and has sent the attached Certified Local Government Agreement to the City for approval. E. In addition, the CLG Agreement requires the City to do the following: a. Enforce appropriate state or local legislation for the designation and protection of historic properties. b. Maintain a system for the survey and inventory of historic properties, and employ the use of Statewide Historic Property Inventory Online Entry System for future survey work within the City of Pasco. c. Provide for adequate public participation in the local preservation program, including the process of recommending properties to the National Register. d. Employ sufficient professional staff to carry out its federal historic preservation responsibilities. e. Adhere to requirements outlined in the State of Washington's Certified Local Government Program Requirements and Procedures, as amended 2002, issued by the Department of Archaeology and Historic Preservation. F. If Council concurs with the proposed agreement, it should be approved. CERTIFICATION AGREEMENT Pursuant to the provisions of the National Historic Preservation Act, as amended, to applicable federal regulations (36 CFR 61), and to the State of Washington's Certified Local Government Program Requirements and Procedures, as amended 2002, the City of Pasco agrees to: 1. Enforce appropriate state or local legislation for the designation and protection of historic properties [Section 101(c)(1)(A)]. 2. Establish an adequate and qualified historic preservation review commission by state or local law [Section 101(c)(1)(13)]. 3. Maintain a system for the survey and inventory of historic properties [Section 101(c)(1)(C)]. Employ the use of Statewide Historic Property Inventory Online Entry System for future survey work within the City of Pasco. 4. Provide for adequate public participation in the local preservation program, including the process of recommending properties to the National Register [Sections101(c)(1)(1)), (c)(2)(A) and (c)(2)(13)]• 5. Satisfactorily perform the responsibilities delegated to it under the National Historic Preservation Act, as amended [Section 101(c)(1)(E)]. 6. Employ sufficient professional staff to carry out its federal historic preservation responsibilities. 7. Adhere to requirements outlined in the State of Washington's Certified Local Government Program Requirements and Procedures, as amended 2002, issued by the Department of Archaeology and Historic Preservation. Upon its designation as a Certified Local Government, the City of Pasco shall be eligible for all rights and privileges of a Certified Local Government specified in the Act, federal procedures, and the procedures of the State of Washington. These rights include eligibility to apply for available CLG grant funds in competition only with other Certified Local Governments. The following signatures imply consent to this Certification Agreement and any attachments herein. STATE: Allyson Brooks, Ph.D. Director State Historic Preservation Officer LOCAL GOVERNMENT: Matt Watkins, Mayor City of Pasco Date Date AGENDA REPORT FOR: City Council January 5, 2015 TO: David Zabell, City ManageWorkshop Mtg.: 1/12/15 Rick White, l!/I� V� Regular Mtg.: 1/20/15 Community & Economic Development Director FROM: Angela R. Pitman, Block Grant Administrator COO SUBJECT: HOME Consortium Subrecinient Agreements for 2014 Administration and Down Payment Assistance (DPA) L REFERENCE(S): 1. Proposed Resolution 2. Subrecipient Agreements for Down Payment Assistance and Administration H. ACTION REQUESTED OF COUNCIL / STAFF RECOMMENDATIONS: 1/12: DISCUSSION 1/20: MOTION: I move to approve Resolution No. , authorizing the City Manager to execute the 2014 Administrative and Down Payment Assistance Subrecipient Agreements with the Tri -Cities HOME Consortium Lead Agency. III. FISCAL IMPACT: Pasco's current and future share of federal HOME entitlement funds ($200,000 for Program Year 2014), and administrative funds from Program Income when received. IV. HISTORY AND FACTS BRIEF: A. Pasco entered into a HOME consortium agreement with Richland and Kennewick in 1995, making the city eligible for federal HOME funds. The populations of the individual cities alone do not meet the U.S. Department of Housing and Urban Development (HUD) minimum. By joining together in a consortium, funds are available to the three cities. The original consortium agreement ran from 1995 through 1998. In 2007, the agreement was amended to renew automatically unless one of the cities objects. B. Per HUD regulations the Lead Agency (Richland) is required to execute subrecipient agreements with each member city, which authorizes each member city to cavy out projects on behalf of the Consortium. C. The requirement for subrecipient agreements formalizes Pasco's relationship to the Lead Agency. Without the subrecipient agreements, only the Lead Agency is authorized to expend funds and carry out projects. V. DISCUSSION: A. In November, the 2014 subrecipient agreements were revised, beginning with 2014 grant funds forward, as follows: • DPA awards will be converted from loans to grants. • DPA loans to be standardized and capped at $10,000 per household (depending on need). • In the event that any consortium -wide administrative shortfalls occur, the cost of such shortfalls shall be shared equally by all members. Members agree that compliance with new standardized forms, checklists, and processes are required in order to keep the administrative costs to currently projected levels. ■ In the event that negative interest occurs as a result of the action(s) of a particular Member, then that Member is fully responsible for reimbursing the Lead Entity; However, if negative interest occurs that's not directly related to a single Member's actions, then each Member shall equally share in that cost. • Funding timelines are reduced to allow time to redirect funds to other areas prior to timeliness becoming an issue. B. As the proposed 2014 subrecipient agreement reflects the consensus of each member city and will reduce administrative effort and costs for all, staff recommends Council / a approval. to) RESOLUTION NO. A RESOLUTION APPROVING THE 2014 SUBRECIPIENT AGREEMENTS FOR HOME PROGRAMS AND AUTHORIZING THE CITY MANAGER TO EXECUTE HOME CONSORTIUM SUBRECIPIENT AGREEMENTS FOR PROGRAM YEARS 2014 WHEREAS, the Cities of Kennewick, Pasco and Richland entered into a cooperative agreement to form a consortium to increase the local supply of decent affordable housing to low income residents as authorized by Public Law 101-625, the National Affordable Housing Act of 1990 (NAHA); and WHEREAS, Council has previously approved HOME programs contained in Consolidated Plan for program years 2015-2019; and WHEREAS, each program year Council approves programs to be carried out in the supplemental Annual Action Plan, and WHEREAS, HUD regulations require subrecipient agreements between the HOME Consortium Lead Agency and the City of Pasco authorizing the City to cant' out programs, expend funds and execute agreements; and WHEREAS, HUD has further advised that subrecipient agreements for past, current and future years and for each type of program will be required, NOW THEREORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PASCO: That the City Council approves subrecipient agreements for City of Pasco HOME programs to be executed for program year 2014 to increase the supply of decent and affordable housing to low income residents, and authorizes the City Manager to execute them. BE IT FURTHER RESOLVED that this Resolution shall take effect immediately. PASSED by the City Council of the City of Pasco this day of January, 2015 Matt Watkins Mayor ATTEST: Debra L. Clark MMC City Clerk APPROVED AS TO FORM: Leland B. Kerr City Attorney TRI -CITIES HOME CONSORTIUM SUBRECIPIENT WRITTEN AGREEMENT DOWNPAYMENT ASSISTANCE MANAGED BY SUBRECIPIENT March 4, 2014 This HOME Program Subrecipient Agreement is made and entered into as of the _ day of , 20 , between the City of Richland, Lead Entity of the Tri -Cities HOME Consortium, 505 Swift Avenue, Richland, Washington, hereinafter referred to as "Consortium," and , a member City of the Consortium, whose address is hereinafter referred to as "Subrecipient." This Agreement is authorized by Title II, Sections 216 and 217 of the Cranston -Gonzalez National Affordable Housing Act of 1990, as amended, and the correlating federal regulations found at 24 CFR Part 92, together known as the HOME Investment Partnerships (HOME) Program. W -1 -T -N -E -S -S -E -T -H: I. RECITALS WHEREAS, the Federal Government has made funds available to the Consortium pursuant to the HOME Program CFDA 14.239 to increase the number of families, especially low income families, served with decent, safe, sanitary and affordable housing, and to expand the long term supply of affordable housing; and WHEREAS, the Consortium seeks to invest a portion of its HOME allocation to support affordable home ownership opportunities through the provision of Downpayment Assistance to eligible homebuyers; and WHEREAS, the HOME Program authorizes contracts with public agencies to carry out the objective identified above; and WHEREAS, the City of Richland has been designated as the Lead Entity of the Tri -Cities HOME Consortium as delineated in the 'Tri -Cities HOME Consortium Agreement" and WHEREAS, the Lead Entity is responsible for the distribution of funds to the Subrecipient(s) who manage projects utilizing said HOME funds; and WHEREAS, the Lead Entity is also responsible for monitoring, reporting, and record- keeping to assure compliance with federal regulations of the HOME Investment Partnership Program; and WHEREAS, the U.S. Department of Housing and Urban Development ("HUD") requires the Lead Entity to execute Subrecipient Agreements when applicable; NOW, THEREFORE, the parties, for and in consideration of the promises and mutual obligations set forth below, agree as provided for in this Agreement. DPA Subrecipient Agreement Pasco 2014 Page 1 of 22 II. Definitions Section 1 — Definitions (92.2) Downpayment Assistance - HOME funds provided to assist eligible buyers in purchasing eligible homes. Up to $10,000 in direct assistance will be used to assist eligible buyers purchase eligible homes. HOME Funds - The total amount of HOME Program dollars being provided to the Subrecipient under this Agreement. HOME Assisted Unit - Those units in the Project, which are assisted with the use of HOME Funds in the form of Downpayment Assistance Lead Entitv - The unit of local government designated by the Tri -Cities HOME Consortium to act in a representative capacity of all members for the purposes of this Agreement (City of Richland). The Lead Entity will assume overall responsibility for ensuring that the Tri -Cities HOME Consortium is administered and operates in compliance with the requirements of the HOME Program. The Lead Entity serves as the official and primary contact between HUD and the Tri -Cities HOME Consortium. Project - The activity and result for which HOME Funds are being provided under this Agreement. Under this Agreement, 'Project' refers exclusively to HOME Downpayment Assistance. Project Delivery Costs - Reasonable and necessary costs incurred by the Subrecipient and/or Lead Entity associated with the financing housing assisted with HOME funds. These may include, but are not limited to, direct staff costs for work associated with a specific address and costs for services required by private lenders. Regulations - The requirements in 24 CFR Part 92 which govern the HOME Investment Partnership Program and the use of HOME Funds, and all related and applicable OMB Circulars, Codes, Regulations, State of Washington, and local requirements. Subrecipient agrees to comply, and, as applicable, to require all third parties to comply with the requirements of the regulations. Should anything in this Agreement be construed to conflict with HOME regulations, the regulations shall prevail. Subrecipient Administrator - HOME Consortium member(s) other than the non -Lead Entity who perform some HOME administrative roles as delineated under separate, specific HOME written Agreements. This term refers to the City of Kennewick and/or the City of Pasco. Tri -Cities HOME Consortium - The particular Consortium operating under the HOME Program consisting of the Cities of Kennewick, Pasco, and Richland. These three cities are each "Consortium Members." DPA Subrecipient Agreement Pasco 2014 Page 2 of 22 III. Agreement Section 2 — The Project (92.205) HOME Funds are being made available to the Subrecipient for the purpose of promoting affordable housing to very low (50% and below median), and low-income (51 % to 80% median) households through the provision of Downpayment Assistance, hereinafter called the "Project." Project Description and Schedule of Completion: Use of HOME funds: Provision of direct assistance to buyers - down payment loan, selling a home at a price below fair market value, principal reduction, and/or prepay and closing cost assistance. Program may be city-wide or limited to areas tar eted for revitalization. Role of Subrecipient: Program marketing, intake and screening of prospective homebuyers, thorough buyer underwriting, income calculation and documentation, executing required agreements with buyers, recordkee in , and ensuring long-term compliance. Role of Lead Entity: Final buyer underwriting and approval. Data entry into IDIS. Date funds must be committed: December 31, 2015 Date funds must be June 30, 2016 expended: The Subrecipient acknowledges and agrees that time is of the essence in this Agreement. HOME funds uncommitted as of December 31. 2015 will be reallocated by the Lead Entity to a CHDO development project or Downpayment Assistance in 2016. All project work will be completed no later than June 30, 2016. Failure to complete the project as agreed upon, or to comply with HOME Program and other applicable local, state or federal requirements, can result in a breach of this Agreement and cause any HOME funds drawn or incurred to become immediately due and repayable to the City of Richland, Lead Entity for the Tri -Cities HOME Consortium. Section 3 — Sources and Uses of Funds (92.504) The total amount of HOME Funds to be allocated to this Downpayment Assistance Project is $200,000 plus Program Income earned in fiscal year. The Project will use a combination of HOME Funds from consortium fiscal year (Jan -Dec) 2014 and unallocated HOME Funds. The Subrecipient will grant up to a maximum of $10,000 in funds to individuals in an amount sufficient to make the homes affordable per underwriting guidelines established by the Consortium. The Subrecipient, and/or Consortium Member, will be named as mortgagee on the properties secured by a recorded Deed and Note as required by 24 CFR 92.254 for a period not less than the period of affordability. The HOME funds shall be no lower in priority than second position on the property unless prior written authorization is granted by the Consortium. The property must be used as the household's primary residence during the term of the HOME Program loan for both homebuyer and homeowner projects. DPA Subrecipient Agreement Pasco 2014 Page 3 of 22 Section 4 — Income Eligibility (5.609) Homebuyers assisted with HOME funds must have household incomes at or below 80% of Area Median Income, as published annually by the Department of Housing and Urban Development. Income documentation will be in a form consistent with HOME requirements as stated in the HUD handbook "Technical Guide for Determining Income and Allowances Under the HOME Program," 24 CFR Part 5. Documentation of household income must be examined in accordance with Consortium HAP guidelines and projected for the next 12 -month period to determine income eligibility. Household income must be re-examined to determine continued eligibility for the HOME Program if the loan closing or recordation of the Deed of Trust occurs later than 6 months from initial income verification. All household members aged 18 or older must certify their gross annual income, including household members who declare no income and non -related adults sharing a household. Section 5 — Minimum HOME Investment (92.205(c)) Homeownership projects must meet the minimum per-unit subsidy amount at 24 CFR 92.205(c), currently established as a minimum of one percent of the purchase price or $1,000, whichever is greater. Section 6 — Maximum HOME Investment (92.250) The Consortium's maximum allowed Downpayment Assistance is $10,000 per household. If Consortium HOME assistance is provided to a household that is receiving HOME assistance, total HOME investment must not exceed the HOME subsidy limits set at 240% of the per unit dollar limits established under Section 221(d)(3)(ii) of the National Housing Act (12 USC 17151(d)(3)(ii)) for elevator -type projects that apply to Area 4 Benton and Franklin counties (per 24 CFR 92.250). HUD periodically establishes this amount, and once known, the Lead Entity is responsible for forwarding these limits to Subrecipient. If Downpayment Assistance is provided to a buyer purchasing a home developed with HOME funds, this activity must fall under the provisions of a HOME written agreement between the Subrecipient and the Lead Entity separate from this Agreement. Section 7 — Maximum Purchase Price (92.254(a)(2) HOME funds are intended to provide modest housing. The maximum purchase price for existing standard housing cannot exceed 95% of the median area purchase price for single family housing in the jurisdiction as determined annually by HUD, or as determined by the Consortium with written approval from HUD. A newly -constructed home may not exceed the maximum purchase price limit as established annually by HUD. In addition, the purchase price of a property may not exceed the appraised value of the property. Section 8 — Displacement/Relocation Requirement (92.353) and URA Any project that might displace a person, family, business, non-profit organization, or farm must be approved by the Consortium prior to any commitment of HOME funds for the project, or of entering into any type of agreement, whether verbal or written, with another party. Failure to DPA Subrecipient Agreement Pasco 2014 Page 4 of 22 receive prior approval may cause the forfeiture/repayment of any and all sums under this Agreement by the Subrecipient. Section 9 — Environmental Review (92.352) The effects of each activity related to the Project must be assessed in accordance with the provisions of the National Environmental Policy Act of 1969 and the related authorities in 24 CFR Parts 50 and 58, and as detailed in 24 CFR 92.352. The Subrecipient must, prior to committing or undertaking any activity that has physical impacts or limits the choice of alternatives with respect to the Project, regardless of whether such activity is to be funded by the HOME Program or other funds, comply, to the extent applicable, with the regulations found at 24 CFR Part 58. For HOME activities involving only Downpayment Assistance, the 58.6 "Short Form" shall be completed to ensure that there is no environmental impact to the project. Although the Consortium assumes overall responsibility for the environmental review, the Subrecipient agrees to assist in providing information relating to the environmental review. All applicable environmental review and mitigation requirements as provided in 24 CFR 58.5 must be completed by the Lead Entity and approved by the U.S. Department of Housing and Urban Development. The Subrecipient will abide by any special conditions, procedures and requirements of the environmental review, and will advise the Consortium of any proposed change in the scope of the Project or any change in environmental conditions in accordance with 24 CFR 58.71(b). The Subrecipient may not use any of the HOME Funds for acquisition or construction in identified special flood hazard areas unless the Project is subject to the mandatory purchase of flood insurance as required by Section 102(a) of the Flood Disaster Protection Act of 1973. Failure to comply with this provision will cause an immediate cancellation of this Agreement and forfeiture/repayment of HOME funds. Section 10 — Disbursement of Funds (85.22) The Subrecipient may request funds under this Agreement only when a written agreement (per 24 CFR 92.504(c)) has been fully executed, the funds are needed for payment of specific allowable costs (per 24 CFR 92.206), and only in amounts needed to pay such costs as identified in 24 CFR 85.22. The Subrecipient shall be reimbursed for eligible project costs after review and approval by the Consortium of invoices, statements and other billings, supporting documentation, and property inspection, if applicable. Upon prior approval from the Lead Entity, the Consortium may pay a vendor or contractor directly. Section 11 — Relationship The relationship of the Subrecipient to the Consortium shall be that of an independent agency. Nothing herein shall be deemed to create the relationship of employer/employee or principal/agent between the parties. Section 12 — Modifications and Amendments This Agreement may only be amended in writing signed by the Consortium and the Subrecipient. All modifications and amendments to this Agreement shall be in writing; such DPA Subrecipient Agreement Pasco 2014 Page 5 of 22 modification or amendment shall not take effect until specifically approved in writing by the Lead Entity of the Consortium and signed by all parties to this Agreement. Section 13 —Waivers No conditions or provisions of this Agreement shall be waived unless approved by the Consortium in writing. Section 14 —Assignment The Subrecipient shall not assign any interest in this Agreement, and shall not transfer any interest in this Agreement to any party (whether by assignment or novation) without prior written consent of the Consortium. Section 15 — Severability If any provision of this Agreement, or portion thereof, is held invalid by any court of rightful jurisdiction, the remainder of this Agreement shall not be affected, providing the remainder continues to conform to applicable Federal and State law(s) and regulations and can be given effect without the invalid provision. Section 16 — Insurance and Bonds The Subrecipient and its employees, volunteers, contractors or consultants shall carry throughout the life of this Agreement General Liability Insurance, Comprehensive Automobile Liability Insurance, and other such coverage as may be appropriate or required by State or Federal law, for the services to be performed. This insurance shall include the following: Professional Legal Liabilitv: Subrecipient shall maintain Professional Legal Liability or Professional Errors and Omissions coverage appropriate to the Subrecipient's profession and shall be written subject to limits of not less than $1 million per claim and $1 million policy aggregate limit. The coverage shall apply to liability for a professional error, act, or omission arising out of the scope of the work for this Agreement. Coverage shall not exclude bodily injury, hazards, or property damage related to the work in this Agreement, including testing, monitoring, measuring operations, or laboratory analysis where such services are rendered as part of the Agreement. Worker's Compensation (Industrial Insurance): Workers' Compensation insurance as required by Title 51 RCW shall be maintained, and Subrecipient shall provide evidence of coverage if so required. 3. Commercial General Liability: Commercial General Liability coverage shall be written on ISO occurrence form CG 00 01 and shall cover liability arising from premises, operations, independent contractors, personal injury and advertising injury. The insurance shall include the Consortium, its members, officers, officials, employees and agents with respect to performance of services, and shall contain no special limitations on the scope of protection afforded as an additional insured. If this Agreement is over $50,000 then Employers Liability Coverage shall also be maintained. Coverage shall include limits of not less than $1 million per occurrence, and $2 million aggregate. DPA Subrecipient Agreement Pasco 2014 Page 6 of 22 4. Automobile Liability: Business Automobile Liability insurance with a minimum combined limit no less than $1 million per accident for bodily injury and property damage shall be maintained. Coverage shall include owned, hired, leased, and non -owned automobiles. Coverage shall be written on Insurance Services Office (ISO) form CA 00 01 or a substitute form providing equivalent liability coverage. If deemed necessary, the policy shall be endorsed to provide contractual liability coverage. Insurance is to be placed with insurers with a current A.M. best rating of not less than A: VII. Subrecipient shall furnish the Consortium with original certificates and a copy of the amendatory endorsements, including, but not necessarily limited to, the additional insured endorsement, evidencing the insurance requirements prior to the commencement of the work. The insurance coverage shall be primary with respect to any insurance or self-insurance covering the Consortium, its members, elected and appointed officers, officials, employees and agents. Any insurance, self-insurance, or insurance pool coverage maintained by the Consortium shall be excess of the Subrecipient's insurance and shall not contribute with it. Subrecipient shall give 30 days' prior written notice by certified mail, return receipt requested, to the Consortium prior to any attempt to cancel any insurance policy maintained under this Agreement. Section 17 — Procurement Standards (84.40-48 Non Profit or 85.36(b) Government) If applicable to its Downpayment Assistance program, the Subrecipient will establish procurement procedures to ensure that materials and services are obtained in a cost-effective manner. At a minimum, the Subrecipient shall comply with the nonprofit procurement standards at 24 CFR 84.40-48, or 24 CFR 85.36(b) for governmental entities. Section 18 — Program Income (92.503) and Administrative Funds (92.207) Program income must be remitted to the Lead Entity within thirty (30) days of receipt to assist the Consortium from drawing additional funds from the U.S. Treasury. The Subrecipient will provide information as to the Project that generated the funds. Subrecipient will be eligible to use 10% of its own generated program income for administrative purposes, and the balance of 90% will be distributed to projects in accordance with the approved Annual Action Plan. Section 19 — Match Requirement (92.218) The HOME program requires a non -federally funded 25% match to funds drawn from the federal government. The Subrecipient is required to document sources of match, both cash and in kind, and submit this information quarterly to the Lead Entity. The Subrecipient is responsible for tracking and reporting any HOME Match generated by its Downpayment Assistance Program. As written in the Tri -Cities HOME Consortium Agreement: Should the Consortium's accrued HOME Match balance fall below one full year's Match obligation, each Member shall be responsible for generating the required match based on their share of funds. If the Match cannot be supplied by the responsible Member, then HOME funds and associated match obligation may be transferred to another Member by Lead Entity. If a member fails to supply sufficient match, their share of HOME funding may be reduced commensurate with the match deficiency, as delineated in any related Subrecipient Agreements. DPA Subrecipient Agreement Pasco 2014 Page 7 of 22 Section 20 — Period of Compliance/Period of Affordability (92.254(b)4 Owner or 92.252(e) Rental The HOME -assisted housing must meet the affordability requirements established at 24 CFR 92.254(4) for owner -occupied units, or for a period not less than specified in the following table: Homeownership Assistance HOME amount per unit* Minimum Period of Affordability In Years Under $15,000 5 $15,000 to $40,000 10 Over $40,000 or rehabilitation involving refinancing 15 This period of compliance is called the "Period of Affordability" for the Project, beginning after the Project is completed and occupied by an eligible household, and without regard to the term of the loan or the transfer of ownership, except as noted below. The terms of affordability and reporting requirements must be conveyed to the owner. Section 21 — Termination of Period of Affordability (92.254(a)(5)(i)(A) The applicability of the regulations may be terminated upon foreclosure or transfer in lieu of foreclosure. The applicability of the affordability regulations shall be revived according to the original terms if during the original Period of Affordability, the owner of record, before the foreclosure or deed in lieu of foreclosure, or any entity that includes the former owner or those with whom the former owner has or had family or business ties, obtains an ownership interest in the project or property. Subrecipient may use purchase options, rights of first refusal, or other preemptive rights to purchase the housing before foreclosure in order to preserve affordability. Section 22 — Recapture Requirements (92.254) Section 215 of the HOME statute requires that to be classified as affordable housing, the property must have an initial purchase price that does not exceed 95% of the median purchase price for the area, the house must be the principal residence of an owner who qualifies as low income (80% or below median as established annually by HUD) at the time of purchase, and be subject to either resale or recapture provisions. The Consortium uniformly applies the recapture provision to ensure affordability as set forth in 24 CFR 92.254(a)(4), and 24 CFR 92.254(a)(5)(ii)(A)(1) and (A)(2), and (A)(5). Homebuyer direct assistance including downpayment, closing costs and other direct subsidies such as principal reduction, interest buy - downs, etc. are subject to recapture provisions. It also includes any HOME investment that reduced the initial purchase price from fair market value to an affordable price (direct subsidy), and/or principal and interest balance. Deed of Trust restrictions, promissory notes, and written agreements are required on each HOME assisted unit during the period of affordability, with specific loan terms and conditions established by the Consortium. These documents enforce the recapture provision throughout the period of affordability, which starts when all funds have been drawn, information has been entered into HUD's Integrated Disbursement and Information System (IDIS), and the Project has been closed in IDIS. DPA Subrecipient Agreement Pasco 2014 Page 8 of 22 Recapture is triggered by any transfer of title, either voluntary or involuntary, or if the housing does not continue to be the principal residence of the family during the period of affordability. This period is not contingent on loan terms and an amortization period. If the property is not used as the primary residence yet is held in ownership by the HOME - assisted owner, under recapture provisions the entire HOME investment must be repaid, less any HOME Program principal repayments already made, but is not subject to prorated or other reductions during the period of affordability. Recaptured funds from the sale are determined by the amount of net proceeds available from the sale. Net proceeds are defined as the sales price minus superior loan repayment (other than HOME funds) and any closing costs. The amount recaptured will not exceed the total net proceeds available. Funds that are recaptured from the sale or transfer of property during the period of affordability must be immediately returned to the City of Richland, as Lead Agency of the Consortium. Recapture Provisions The method the Tri -Cities HOME Consortium will use to structure its recapture provisions is as follows: Direct HOME Subsidy. The PJ recaptures the entire amount of the direct HOME subsidy provided to the homebuyer before the homebuyer receives a return. The recapture amount is limited to the net proceeds available from the sale of the property during the period of affordability. If there are insufficient net proceeds available at sale, the homebuyer is not required to repay the difference between the total direct HOME subsidy and the amount that is available from net proceeds, and the PJ is not required to pay the difference to HUD. Example: A homebuyer receives $5,000 of direct HOME Downpayment Assistance to purchase a home at zero percent interest. The homebuyer sells the home after three years, during the required 5 -year period of affordability. The PJ would recapture, assuming there are sufficient net proceeds, the entire $5000 direct HOME subsidy. The homebuyer would receive any net proceeds in excess of $5, 000. The HOME Consortium will provide up to $10,000 in direct assistance to an eligible homeowner for an eligible property. The direct assistance will be forgiven at the end of the five year period of affordability. The loan will become immediately due and payable to the HOME Consortium if any of the following occurs during the duration of the loan: (1) the transfer or attempted transfer of an interest in a portion or all of the Property, whether by sale, refinance, contract, assignment or otherwise; (2) the death of all persons comprising the Borrower; (3) a default on any terms of the First Subordinate Deed of Trust, the First Promissory Note or the First Deed of Trust; (4) failure of the Borrower to use the Property continuously as the Borrower's principal or primary residence; (5) the renting, leasing or subletting of the Property to any third party for any purpose. To preserve affordability, Consortium members may use purchase options, rights of first refusal, or other preemptive rights to purchase previous HOME assisted housing prior to foreclosure or at a foreclosure sale. HOME funds may not be used to repay a HOME loan or investment. The DPA Subrecipient Agreement Pasco 2014 Page 9 of 22 additional HOME assistance, combined with the initial HOME investment, may not exceed the maximum per unit subsidy limits established at 221(d)(3) for elevator construction. The affordability restrictions may terminate upon foreclosure, transfer in lieu of foreclosure, or assignment of an FHA insured mortgage to HUD. However, affordability restrictions must be revived per the original terms if during the original affordability period, the owner of record, before the termination event, obtains an ownership interest in the housing. Section 24 — Property Standards (92.251) All existing housing assisted with Homebuyer/Downpayment Assistance must be decent, safe, sanitary, and in good repair. Acquisition of existing housing must be decent, safe, and sanitary, meet Housing Quality Standards (HQS), pass a visual paint assessment if constructed prior to 1978, and meet local ordinances and zoning at the time of project completion. Homes must meet all applicable Washington State and local City housing quality standards and code requirements. If the property is new construction and not assisted with HOME funds during the construction activities, it must have a Certificate of Occupancy issued prior to HOME Homebuyer/Downpayment Assistance and loan closing. Under the New HOME Final Rule, released in July 2013, homes must be free of any deficiencies identified by HUD in the UPCS (pursuant to 24 CFR 5.705) based on the inspectable items and inspected areas in HUD -determined physical inspection procedures. If the housing does not meet these standards, the housing must be rehabilitated to meet the standards or it cannot be acquired using HOME Downpayment Assistance funds. Note: Until HUD issues specific guidance on OPCS standards, the property standard requirements in the paragraph above will apply to all Projects. Section 25 — Non -Discrimination and Equal Opportunity The Subrecipient agrees that it will utilize and make available the HOME funds in conformity with the non-discrimination and equal opportunity requirements set out in the HUD regulations in the National Housing Affordability Act. These regulations include: The requirements of the Fair Housing Act, 42 U.S.C. 3601-20, and implementing regulations at 24 CFR Part 100; Executive Order 11063 (Equal Opportunity in Housing) as amended by Executive Order 12259 and implementing regulations at 24 CFR 107; and Title VI of the Civil Rights Act of 1964, 42 U.S.C. 2000d, and implementing regulations at 24 CFR Part 1 (Nondiscrimination in Federally Assisted Programs); 2. The prohibitions against discrimination on the basis of age under the Age Discrimination Act of 1975 (42 U.S.C. 6101-07) and the regulations at 24 CFR 146; 3. The prohibitions against discrimination on the basis of handicap under Section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794) and implementing regulations at 24 CFR, Part 8; 4. The requirements of the Executive Order 11246 (Equal Employment Opportunity) and the regulations issued under the Order at 41 CFR Chapter 60; 5. The requirements of Section 3 of the Housing and Urban Development Act of 1968, 12 U.S.C. 1702u (Employment Opportunities for Business and Lower Income Persons in Connection with Assisted Projects); and DPA Subrecipient Agreement Pasco 2014 Page 10 of 22 6. The requirements of Executive Orders 11625 and 12432 regarding Minority Business Enterprise, and 12138 regarding women's Business Enterprise, and regulations S.85.36(e) of Section 281 of the National Housing Affordability Act. 7. The requirements of Washington State law as found at RCW 49.60. 8. Equal Access to Housing in HUD Program Regardless of Sexual Orientation and Gender Identity FR -5359 February 2012. Through this final rule, HUD implements policy to ensure that its core programs are open to all eligible individuals and families based on their need regardless of sexual orientation, gender identity, or marital status. This rule follows a January 24, 2011 proposed rule which noted evidence suggesting that lesbian, gay, bisexual, and transgender (LGBT) individuals and families are being arbitrarily excluded from housing opportunities in the private sector. The rule clarifies that individuals and families may not be excluded from participation because one or more members of the household may be an LGBT individual, have an LGBT relationship, or be perceived to be such an individual or in such relationship. Owners and operators of HUD assisted housing or housing financed or insured by HUD may not inquire about the sexual orientation or gender identity of the applicant for, or occupant of, the dwelling, whether renter or owner occupied. Section 26—Affirmative Marketing (92,351(a), MBE/WBE Records (92.351(b) and 85.36(e) and Reports) The Consortium's policy is to provide information and attract eligible persons to available housing without regard to race, color, national origin, sex, religion, familial status (persons with children under 18 years of age, including pregnant women), or disability. The procedures followed are intended to further the objectives of Title VIII of the Civil Rights Act of 1968 (Fair Housing Act), and Executive Order 11063, which prohibits discrimination in the sale, leasing, rent and other disposition of properties and facilities owned or operated by the federal government or provided with federal funds. In accordance with the Affirmative Marketing regulations of the HOME Program 24 CFR §92.351, the Consortium has established an "Affirmative Marketing Plan" to ensure that all Subrecipient who are allocated HOME Funds employ a marketing plan that promotes fair housing and ensures outreach to all potentially eligible households, especially those least likely to apply for assistance. Affirmative marketing steps will be taken by the Subrecipient to provide information and otherwise attract eligible persons in the housing market area to the available housing without regard to race, color, national origin, sex, religion, familial status or disability. A detailed affirmative marketing plan must be submitted to the Lead Entity of the Tri -Cities HOME Consortium at the start of the Project. The Subrecipient will document and provide data on the outreach steps taken. Reports will be provided in accordance with 92.508(3) that gives a description of each project assisted, including the location, form, and term of assistance. DPA Subrecipient Agreement Pasco 2014 Page 11 of 22 Section 27 — Lead -Based Paint The Subrecipient must comply with the U.S. Department of Housing and Urban Development Lead -Based Paint Regulations (24 CFR Part 35) issued pursuant to the Lead -Based Paint Poisoning Prevention Act (42 U.S.C. Sections 4821-4846, et seq.) and the Residential Lead - Based Paint Hazard Reduction Act of 1992 (42 U.S.C. 4851-4856) requiring elimination of immediate lead-based paint hazards in residential structures; and notification of the hazards of lead-based paint poisoning to purchasers and/or owners of residential structures constructed prior to 1978. Properties must pass the lead-based paint visual inspection (if home built prior to 1978). The Subrecipient will be responsible for conducting a visual inspection of any homes built prior to 1978 to identify any potential issues with lead-based paint. Should the visual inspection identify potential issues, the prospective buyer will be informed, and the buyer and/or seller shall be responsible for all lead-based paint testing, required repairs using safe work practices or a certified lead-based paint abatement firm, and a clearance exam. Section 28- Reimbursement for Project Costs The Lead Entity shall reimburse the Subrecipient for the following documented costs: 1. Direct Assistance to Eligible Homebuyers: The Lead Entity shall reimburse the Subrecipient for HOME Downpayment Assistance provided to eligible buyers for eligible home purchases as delineated in this Agreement. 2. Proiect Delivery Costs: The Lead Entity shall reimburse the Subrecipient for eligible project delivery costs as defined in Section 11 of this Agreement. Staff hours and all other costs must be thoroughly documented to be fully reimbursed. 3. Administrative Costs for Proiects that do NOT go forward: If costs are incurred for a project/homebuyer that does not result in a HOME assisted unit those costs then become the financial responsibility of the Subrecipient and will not be reimbursed by the Lead Entity. The Subrecipient shall submit requests for reimbursement of eligible costs, along with all appropriate documentation to the Lead Entity within 60 days of loan closing. Failure to submit requests for reimbursement shall result in those costs becoming the financial responsibility of the Subrecipient. Section 29 — Conflict of Interest (92.356) Generally, no employee, agent, member, consultant, officer or elected or appointed official of the members in the Consortium or Subrecipient who exercises or has exercised any functions or responsibilities with respect to any activities that are in any way connected with the decision to provide the HOME Funds may obtain a financial interest, reside in, or benefit from those activities, or have an interest in any contract, subcontract or agreement with respect thereto, or the proceeds thereunder, either for themselves or those with whom they have family or business ties, during their tenure or for one year thereafter as stated in 24 CFR 92.356, and the Subrecipient must take appropriate steps to assure compliance. Section 30 — Records (92.508) Project beneficiary information pertaining to household size, income levels, racial/ethnic characteristics, disability status, household composition, female head of household composition, DPA Subrecipient Agreement Pasco 2014 Page 12 of 22 and any other information required by the Consortium and HUD, will be collected and documented in an individual and cumulative manner. Project management records must be kept which demonstrate compliance with this Agreement and related regulations of the HOME Program 24 CFR 92. Records must be kept by the Subrecipient and be made available to the Consortium that demonstrate compliance with this Agreement and with 24 CFR 92.508. Records must be maintained for at least five (5) years after the Project completion date, except for documents imposing recapture restrictions, which must be retained for five (5) years after the expiration of the period of affordability, as specified above, or as any of the following apply: 1. Records that are the subject of audit findings must be retained for three (3) years after such findings have been resolved; 2. Records for non -expendable property (as defined in OMB Circular #A-110 for non-profit organizations) shall be retained for three (3) years after its final disposition. If any litigation, claim, negotiation, audit, monitoring, inspection or other action has been started before the expiration of the required record retention period, records must be retained until completion of the action and resolution of all issues which arise from it, or until the end of the required period, whichever is later. Upon request, the Subrecipient agrees to immediately provide to the Lead Entity any and all information to document compliance with the HOME Program and related laws, rules, regulations and policies. Section 31 — Public Records The Subrecipient understands that this Agreement is subject to public records disclosure pursuant to RCW 42.56 and agrees to timely provide documents as required by law. The Subrecipient shall indemnify, defend and hold harmless the Lead Entity of the Consortium for any liability arising out of the Subrecipient's failure to produce public records as required. Section 32 — Monitoring At least annually, or more often if deemed necessary, the Lead Entity will monitor the performance of the Subrecipient to assure compliance with the requirements of this Agreement. The review may include on-site inspections and review of records to determine compliance with this Agreement through the contract period. Monitoring forms primarily used can be found at: http://portal.hud.govlhudportal/HUD?src=/program offices/administration/hudclips/handbooks/cod/6509 2 Chapter 7 for the HOME Investment Partnership Program. The Subrecipient agrees to provide any and all information to the Consortium to assist in meeting administrative and monitoring requirements, including reporting progress of the Project in IDIS. The Subrecipient agrees to work cooperatively with the Consortium to assist in meeting its obligations to HUD. Any duly authorized representative of the U.S. Department of Housing and Urban Development, authorized federal or state agent, or the Consortium shall at all reasonable times have access to and the right to inspect, copy, audit, and examine all books, records and other documents relating directly to the Subrecipient's receipt and disbursement of the HOME funds, as well as DPA Subrecipient Agreement Pasco 2014 Page 13 of 22 access to the project site(s) and all project records. The Subrecipient agrees to immediately correct any deficiencies as noted by the Lead Entity, HUD, and/or other authorized entities. The Subrecipient agrees to assist and cooperate with the Consortium in monitoring each housing unit for principal residency as provided in 24 CFR 92.254(a)(3) upon completion of the project and during the period of affordability. Section 33 — Financial Responsibility and Timeliness of Reimbursement Requests The Subrecipient agrees that it is financially and legally responsible for any monitoring/audit exception which occurs due to its negligence or failure to comply with the terms of this Agreement and/or HOME regulations. As provided in Section 28 regarding Reimbursement, the Subrecipient acknowledges that failure to submit reimbursement requests with all appropriate supportive documentation within 60 days of loan closing and direct assistance to the homebuyer shall result in those costs becoming the financial responsibility of the Subrecipient. The Subrecipient further acknowledges that if costs are incurred for a project/homebuyer that does not result in a HOME assisted unit, those expenditures may be reimbursed from the Subrecipient's administration funds derived from program income generated by other HOME projects. If the Subrecipient has no balance of HOME program income from which such costs can be reimbursed, those costs then become the financial responsibility of the Subrecipient and will not be reimbursed by the Lead Entity. Section 34— Indemnification The Subrecipient will save and hold harmless and indemnify the Lead Entity against any and all liability, claims and costs of whatever kind and nature for injury to or death of any person or persons, and for loss or damage to any property, occurring in connection with or in any way incident to or arising out of activities undertaken under this Agreement. Further, Subrecipient shall reimburse the Lead Entity for all costs incurred in connection with a negative audit finding resulting from Subrecipient's negligent or willful mismanagement of HOME funds, or its negligent or willful disregard for the laws, rules and regulations governing the HOME Investment Partnership Program. Section 35 — Corrective and Remedial Action Subrecipient will immediately correct or cause to be immediately corrected any and all actions or performance deficiencies in the Project as may be determined by the Lead Entity, or the U.S. Department of Housing and Urban Development (HUD). Failure to correct such actions or performance deficiencies within thirty (30) days from written notification from the Lead Entity shall result in suspending all HOME -funded projects, the cancellation of this Agreement and other HOME Program contracts, the reprogramming of HOME funds to other eligible activities, and/or the repayment of the HOME funds from non-federal sources. Section 36 — Attorney's Fees and Costs In the event of a lawsuit between the parties to this Agreement, the prevailing party shall be entitled to recover judgment against the other party for reasonable attorney's fees and other costs either at trial or on appeal. If either party exercises any non -judicial right or remedy to enforce such party's rights hereunder, it shall be a condition for the cure of the default that the defaulting party will pay the non -defaulting party's reasonable attorney's fees incurred and all DPA Subrecipient Agreement Pasco 2014 Page 14 of 22 reasonable costs. Failure to pay such costs and reasonable attorney's fees shall constitute an event of default under this Agreement. Section 37 — Venue and Law Except where federal law controls, this Agreement shall be governed by the laws of the State of Washington. Venue for any action under this contract shall be in Benton County, Washington. Section 38 — Suspension or Termination of Agreement The Consortium may cancel this Agreement "for cause" or "not for cause" by providing written 30 days' notice by certified mail, return receipt requested, to the other signatory members of this Agreement. There are three (3) separate methods of suspension or termination of this Agreement: By fulfillment. The Agreement will be considered to be terminated upon fulfillment of its terms and conditions. ii. By mutual consent. The Agreement may be terminated or suspended in whole or in part, at any time, if both parties consent to such termination or suspension. The conditions of the suspension or termination shall be documented by giving a minimum of thirty (30) days' written notice. For cause. The Consortium may suspend or terminate this Agreement in whole or in part, for cause, when the Subrecipient has failed in whole or in part to meet its commitments and obligations as outlined, and when the Consortium deems continuation to be detrimental to its interest. Failure to carry out the project as described and in compliance with HOME Program regulations found at 24 CFR 92 shall be deemed a failure to perform, and cause the immediate relinquishment of any interest in future HOME funds and/or require repayment of expended HOME funds. In the event of suspension, the Consortium will notify the Subrecipient in writing of the corrective action required. Further payment may be withheld at the Consortium's discretion until the Subrecipient causes corrective action or the Agreement is terminated. "For cause" includes: a. Failure to comply with the terms and conditions of this Agreement, or to substantiate compliance; b. Improper or illegal use of project funds or resources; C. Any illegal act by the Subrecipient and its representatives; Failure to submit required reports on or before the due date or failure to document compliance with the terms and conditions contained herein. In the event of termination, the Lead Entity will notify the Subrecipient in writing of its determination to terminate, the reason for such termination, and the effective date of the DPA Subrecipient Agreement Pasco 2014 Page 15 of 22 termination. Payments made to the Subrecipient or recoveries by the Consortium will be in accordance with the legal rights and liabilities of the parties. Recoveries include all HOME funds on hand at the time of Agreement termination, any accounts receivable attributable to the use of HOME funds, and any other assets acquired with HOME funds. Actions by either party under this article shall not constitute a waiver of any claim by either party arising from conditions or situations leading to such suspension or termination. HOME funds not committed to specific projects as of the termination date will be relinquished to the Consortium for redistribution to other qualified projects. Section 39 — Dispute Resolution The Lead Entity and the Subrecipient agree to negotiate in good faith for a period of 30 days from the date of notice of all disputes between them prior to exercising their legal rights under this Agreement or other law. All disputes not resolved by negotiation between the parties may be arbitrated only by mutual agreement of the parties. If not mutually agreed to resolve the claim by arbitration, the claim will be resolved by legal action. Arbitration of all claims will be in accordance with the RCW 7.04A and the mandatory rules of arbitration with venue being placed in Benton County, Washington. Arbitration shall include an award to the prevailing party of its reasonable attorney fees and costs in action against the other. Section 40 — Written Agreement with Homebuyers (92.504(a)) In accordance with the provisions of 24 CFR 92.504(c)(5), when assistance is provided to a homebuyer or homeowner, a written agreement separate from deeds, promissory notes, or other security instruments must be entered into that includes, at a minimum: For homebuyers, the agreement must conform to the requirements in 92.254(a) and specify the value of the property, principal residence, recapture provisions, and lease -purchase, if applicable. The agreement must specify the amount of HOME funds, the term and form of assistance whether grant or loan, the use of the funds for down payment, closing costs, rehabilitation, etc., and the date by which the housing must be acquired. For homeowners, the written agreement must conform to the requirements in 92.254(b) and specify the amount, term, and form of HOME assistance, rehabilitation work to be undertaken, roles and responsibilities, date for completion, and property standards to be met. The approved written agreement shall be provided to the Subrecipient by the Lead Entity Section 41 - Debarment and Suspension (2 CFR 2424) The Subrecipient may not award or permit an award of a contract to any party which is debarred, suspended or ineligible to participate in a federal program. The Subrecipient certifies that it is not debarred, suspended or ineligible to participate in a federal program. The Subrecipient will submit to the Consortium the names of contractors and any subcontractors prior to signing contracts to ensure compliance with 24 CFR Part 24, "Debarment and Suspension." The Subrecipient will also assure that language pertaining to debarred, suspended or ineligibility to participate is inserted in all contract agreements. If, during the time DPA Subrecipient Agreement Pasco 2014 Page 16 of 22 of this Agreement, the Subrecipient is debarred, suspended or ineligible to participate in a federal program, the Consortium may terminate this Agreement for cause. Section 42 — Financial Management and Audits (92.506) The Subrecipient shall adhere to the generally accepted accounting principles and procedures issued by the American Institute of Certified Public Accountants, and will utilize adequate internal controls and maintain necessary source documentation for all costs incurred. The Subrecipient shall comply with cost principles as established by OMB Circulars A-87, relocated to 2 CFR, Part 225, and with administrative requirements at A-102 if a state, local government, or Indian tribe. If the Subrecipient is a non-profit organization, it will comply with cost principles of OMB Circular A-122, relocated to 2 CFR, Part 230, and administrative requirements established at OMB Circular A-110. All costs must be reasonable and necessary. The Subrecipient shall also comply with auditing standards issued by the Comptroller General of the United States and be conducted in accordance with 24 CFR 84.26 and 85.26. All subrecipients who expend $500,000 or more in a year in federal awards, whether a direct subrecipient of this Agreement or a sub-subrecipient receiving federal funds through a pass- through entity, shall have a single audit conducted for that year in accordance with the provision of OMB A-133, Subpart B. When a Subrecipient expends federal awards under only one federal program, excluding Research and Development performed by a non-federal entity, and the program's laws, regulations, or grant agreements do not require a financial statement audit, the subrecipient may elect to have a program -specific audit conducted in accordance with Subpart B, Section 235. A program -specific audit may not be elected for Research and Development unless all of the federal awards expended were received from the same federal agency, or the same federal agency and the same pass-through entity, and that federal agency, or pass- through entity approves in advance a program -specific audit. The audit must be conducted within 60 days of completion of this Agreement. Non-federal entities who expend less than $500,000 a year in federal awards are exempt from federal audit requirements for that year, except this does not limit the authority of federal agencies, including HUD, Inspectors General, or General Accounting Office to conduct or arrange for additional audits. All records shall be made available for review or audit by appropriate local, state and federal entities. Section 43 — Title Insurance The title policy will name the Consortium as a beneficiary. For acquisition projects not involving any type of construction, the Subrecipient may request a copy of the first lien right lender's title insurance policy. Ownership must be fee simple. Section 44 — DUNS Number A Dun and Bradstreet Data Universal Numbering System (DUNS) number is required for any business or agency that receives federal assistance per the Federal Funding Accountability and Transparency Act of 2006 (FFATA). The Subrecipient will provide information on itself, will assure that all assisted agencies/businesses have been assigned a DUNS number, and shall provide this information to the Lead Entity. A free DUNS number may be requested via the web at http://fedgov.dnb.com/webform/index.isp or by calling 1-866-705-5711. DPA Subrecipient Agreement Pasco 2014 Page 17 of 22 Section 45 — SAM Registration The Federal Funding Accountability and Transparency Act of 2006, as amended (FFATA) requires the Office of Management and Budget (OMB) to maintain a single, searchable website that contains information on all federal spending awards. As part of this, all agencies/businesses that meet the following thresholds must register in SAM and report to the Consortium if they had: a) A gross income from all sources over $300,000 in the agency's previous tax year; and b) Are awarded HOME funds of $25,000 and over. This information must be reported to the Consortium within five (5) days of signing this Agreement. Free registration can be obtained at https://www.sam,gov/portal/public/SAM/. Because this registration expires annually, it must be updated and kept current during the contract period. The Subrecipient will provide information on itself and will assure that all assisted agencies/businesses have registered and remain current in SAM. Additional information is required if more than 80% of annual gross revenues of $25 million or more come from the federal government, and employee and compensation information is not already available through reporting to the SEC. Section 46 — Assessment of Homebuyer Underwriting Before a Subrecipient enters into a legally binding written agreement to provide 2012 and later HOME funds for downpayment assistance, the Subrecipient will assist the Lead Entity in conducting an underwriting review to ensure adequate need for HOME assistance. For all 2012 projects, the Subrecipient must certify to the Consortium that it has fully executed a written agreement with a homebuyer that meets the requirements of the HOME regulations, and that all statements and claims made are true and correct. Section 47 — Reversion of Assets Upon expiration of this Agreement, any HOME funds or accounts receivable that can be attributed to the use of HOME funds will revert to the Lead Entity of the Consortium. Should the Consortium Member stop participating in consortium programs or fail to perform in compliance with program requirements, assets are subject to reversion to the Lead Entity. Section 48 — Drug Free Workplace In accordance with the Drug Free Workplace Act of 1988, Subrecipient will, or will continue to, provide a drug-free workplace by: Publishing a statement notifying employees that the unlawful manufacture, distribution, dispensing, possession, or use of a controlled substance is prohibited in the workplace, and specifying the actions that will be taken against employees for violation of such prohibition; Establishing an ongoing drug-free awareness program to inform employees about: a) The dangers of drug abuse in the workplace; DPA Subrecipient Agreement Pasco 2014 Page 18 of 22 b) The Subrecipient/employer's policy of maintaining a drug-free workplace; C) Any available drug counseling, rehabilitation, and employee assistance programs; and d) The penalties that may be imposed upon employees for drug abuse violations occurring in the workplace; 3. Making it a requirement that each employee to be engaged in the performance of the grant be given a copy of the statement required by paragraph 1; 4. Notifying the employee in the statement required by paragraph 1 that, as a condition of employment under the grant, the employee will: a) Abide by the terms of the statement; and b) No later than five (5) calendar days after such conviction, notify the employer in writing of his or her conviction for a violation of a criminal drug statute occurring in the workplace; 5. Notifying the agency in writing within ten (10) calendar days after receiving notice under subparagraph 4(b) from an employee, or otherwise receiving actual notice of such conviction. Employers of convicted employees must provide notice, including position title, to every grant officer or other designee on whose grant activity the convicted employee was working, unless the federal agency has designated a central point for the receipt of such notices. Notice shall include the identification number(s) of each affected grant; Taking one of the following actions, within 30 calendar days of receiving notice under subparagraph 4(b), with respect to any employee who is so convicted: a) Taking appropriate personnel action against such an employee, up to and including termination, consistent with the requirements of the Rehabilitation Act of 1973, as amended; or b) Requiring such employee to participate satisfactorily in a drug abuse assistance or rehabilitation program approved for such purposes by a federal, state, or local health, law enforcement, or other appropriate agency; Making a good faith effort to continue to maintain a drug-free workplace by implementation and enforcement of this article while carrying out all HOME Program - related activities. Section 49 — Anti -Lobbying Certification To the best of the signatory party's knowledge and belief: No federal appropriated funds have been paid or will be paid, by or on behalf of it, to any person for influencing or attempting to influence an officer or employee of any agency, a member of Congress, an officer or employee of Congress, or an employee of a member of Congress in connection with the awarding of any federal contract, the making of any federal grant, the making of any federal loan, the entering into of any cooperative agreement, and the extension, DPA Subrecipient Agreement Pasco 2014 Page 19 of 22 continuation, renewal, amendment, or modification of any federal contract, grant, loan, or cooperative agreement; If any funds other than federal appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a member of Congress, an officer or employee of Congress, or an employee of a member of Congress in connection with this federal contract, grant, loan, or cooperative agreement, it will complete and submit Standard Form -LLL, "Disclosure Form to Report Lobbying," in accordance with its instructions; and The language of the above paragraphs of this anti -lobbying certification must be included in the award documents for all sub -awards at all tiers (including subcontracts, sub -grants, and contracts under grants, loans, and cooperative agreements) and all subrecipients/sub- subrecipients shall certify and disclose accordingly. The signatory parties are in compliance with restrictions on lobbying required by 24 CFR Part 87, together with disclosure forms, if required by that part. Section 50 — Uniform Administrative Requirements (92.505) Governmental subrecipients must comply with OMB Circular A-87 for determining allowable costs and the following sections of 24 CFR Part 85: 85.6 Additions and Exceptions 85.12 Special Grant or Subgrant Conditions for "high-risk' Grantees 85.20 Standards for financial management systems 85.22 Allowable costs 85.26 Non -Federal Audit 85.32 Equipment 85.33 Supplies 85.34 Copyrights 85.36 Procurement 85.44 Termination for Convenience 85.51 Later Disallowances and Adjustments 85.52 Collection of Amounts Due Nonprofit (nongovernmental) subrecipients must comply with OMB Circular A-122 and the following section of 24 CFR Part 84: 84.2 Definitions 84.5 Subawards 84.13 Debarment and suspension; Drug -Free Workplace 84.14 Special Award Conditions 84.15 Metric System of Measurements 84.16 Resource Conservation and Recovery Act 84.21 Standards for Financial Management Systems 84.22 Payment 84.26 Non -Federal Audits 84.27 Allowable Costs 84.28 Period of Availability DPA Subrecipient Agreement Pasco 2014 Page 20 of 22 84.30 Purpose of Property Standards 84.31 Insurance Coverage 84.34 Equipment 84.35 Supplies and Other Expendable Property 84.36 Intangible Property 84.37 Property Trust Relationship 84.40 Purpose of Procurement Standards 84.41 Recipient Responsibilities 84.42 Codes of Conduct 84.43 Competition 84.44 Procurement Procedures 84.45 Cost and Price Analysis 84.46 Procurement Records 84.47 Contract Administration 84.48 Contract Provisions 84.51 Monitoring and Reporting Program Performance 84.52 Financial Reporting 84.53 Retention and Access Requirements for Records 84.60 Purpose of Termination and Enforcement 84.61 Termination 84.62 Enforcement 84.72 Subsequent Adjustments and Continuing Responsibilities 84.73 Collection of Amounts Due Section 51 — Homeownership Assistance Program (HAP) Subrecipient agrees that it will follow and comply with Consortium -adopted HAP Guidelines 8.13 and forms, which may be modified periodically by Consortium members with Lead Entity final approval. FORM # _ FORM NAME. 01 Borrower(s) Application 01a -Non Borrower Certification of Income 01 b- Borrower/Applicant Release of Information 02 Addendum to Sales Agreement Notice of Voluntary Arm's Length Transaction 03 Addendum to Sales Agreement 3a-HQS Inspection and Visual LBP Inspection (pre -1978) 3b-HQS Inspection(post-1978) 04 Seller Disclosure Fair Market Value 05 Needs Assessment 06 Financial Records Disclosure 07 Employment Security Department. Self -Request for Records 08 Verification of Employment (VOE) 09 4506-T Request for Transcript of Tax Return 10 Initial Disclosures/Final Disclosures 11 Initial Disclosure Letter 12 Protect Your Family From Lead In Your Home Notification Pamphlet EPA DPA Subrecipient Agreement Pasco 2014 Page 21 of 22 13 Fair Housing — Equal Opportunity for All Notification Pamphlet 14 For Your Protection: Get a Home Inspection 15 Homebuyer Agreement 16 17 HOME Activity Funding Certification 18a Commitment Letter 18b Denial Letter 19 Visual Inspection Form 20 HQS Inspection Form 20a-HQS Homebuyer Self -Certification for Kitchen Appliances 21 Lead Safe Housing Requirements Screening Worksheet 22 Escrow Closing Instructions 23 Correction Agreement 24 Deed of Trust 25 Promissory Note 26 Individual Loan Data Form 27 Subsidy Layering Review—Acquisition Only 28 Sources/Uses Statement The Agreement will be effective upon the date of signing by the City of Richland, Lead Entity of the Tri -Cities HOME Consortium. SUBRECIPIENT: Signature Date Print Name and Title APPROVED AS TO FORM: Heather Kintzley, City Attorney City of Richland CONSORTIUM: Tri -Cities HOME Consortium P.O. Box 190, MS 19 Richland, WA 99352 Cynthia D. Johnson, City Manager Date City of Richland DPA Subrecipient Agreement Pasco 2014 Page 22 of 22 TRI -CITIES HOME CONSORTIUM SUBRECIPIENT WRITTEN AGREEMENT GOVERNING ADMINISTRATIVE FUNDS This HOME Program Subrecipient Agreement, hereinafter called "Agreement," has been made and entered into as of the _day of , 20_, between the City of Richland, Lead Entity of the Tri -Cities HOME Consortium, 505 Swift Avenue, Richland, Washington, hereinafter referred to as "Consortium" or "Lead Entity', and a member City of the Consortium, whose address is hereinafter referred to as "Subrecipient." This Agreement is authorized by Title ll, Sections 216 and 217 of the Cranston -Gonzalez National Affordable Housing Act of 1990, as amended, and the correlating federal regulations found at 24 CFR Part 92, together known as the HOME Investment Partnerships (HOME) Program. W -I -T -N -E -S -S -E -T -H: I. RECITALS WHEREAS, the Federal Government has made funds available to the Consortium pursuant to the HOME Program CFDA 14.239 to increase the number of families, especially low income families, served with decent, safe, sanitary and affordable housing, and to expand the long term supply of affordable housing; and WHEREAS, the HOME Program authorizes contracts with public agencies to carry out the objective identified above; and WHEREAS, the City of Richland has been designated as the Lead Entity of the Tri -Cities HOME Consortium as delineated in the "Tri -Cities HOME Consortium Agreement"; and WHEREAS, projects overseen by a Consortium Member acting as a Subrecipient may generate HOME Program Income, ten percent (10%) of which may be utilized for administrative costs incurred by the Subrecipient; and WHEREAS, Consortium Members will be equally responsible for Lead Entity administrative shortfalls; and WHEREAS, the Lead Entity is responsible for the distribution of administrative funds generated by HOME Program Income to the subrecipient when the Subrecipient's HOME activities generate program income; and WHEREAS, the Lead Entity is also responsible for monitoring, reporting, and record- keeping to assure compliance with federal regulations of the HOME Investment Partnership Program; and WHEREAS, HUD requires the Lead Entity to execute Subrecipient Agreements when applicable; HOME Subrecipient Agreement -Administrative Activities 2014 Page 1 of 14 NOW, THEREFORE, the parties, for and in consideration of the promises and mutual obligations set forth below, agree as provided for in this Agreement. II. Definitions Section 1 — Definitions (92.2) Consortium Agreement - An executed written agreement governing how the Consortium operates and outlining the roles and responsibilities of the Lead Entity and Consortium Members. HOME Funds - The total amount of HOME Program dollars being provided to the Subrecipient under this Agreement. Lead Entitv - The unit of local government designated by the in a representative capacity of all members for the pur, Richland). The Lead Entity will assume overall responsibi HOME Consortium is administered and operates in compll HOME Program. The Lead Entity serves as the official and the Tri -Cities HOME Consortium. Tri -Cities HOME Consortium to act )oses of this Agreement (City of ity for ensuring that the Tri -Cities ance with the requirements of the primary contact between HUD and Program Income - Funds received by the Lead Entity or Subrecipient Administrators that are directly generated by the use of HOME funds or matching contributions. Program income includes, but is not limited to: • Proceeds from the sale or long-term lease of real property acquired, rehabilitated or constructed with HOME funds or matching contributions; • Income from the use or rental of real property owned by the Lead Entity or Subrecipient that was acquired, rehabilitated, or constructed with HOME funds or matching contributions, minus the costs incidental to generating that income; • Payments of principal and interest on loans made with HOME or matching funds, and proceeds from the sale of loans or obligations secured by loans made with HOME or matching contributions; • Interest or other return on investment of HOME and matching funds; • Interest on program income; • Any other interest or return on the investment of HOME and matching funds. Note: Recaptured HOME funds are the repayment of original HOME investments, and are not technically program income. Proiect Delivery Costs - Reasonable and necessary costs incurred by the Subrecipient and/or Lead Entity associated with the development and/or financing of housing assisted with HOME funds. These may include, but are not limited to, direct staff costs for work associated with a specific address and costs for services required by private lenders. Regulations - The requirements in 24 CFR Part 92 which govern the HOME Investment Partnership Program and the use of HOME Funds, and all related and applicable OMB HOME Subrecipient Agreement - Administrative Activities 2014 Page 2 of 14 Circulars, Codes, Regulations, State of Washington, and local requirements. Subrecipient agrees to comply, and, as applicable, to require all third parties to comply with the requirements of the regulations. Should anything in this Agreement be construed to conflict with HOME regulations, the regulations shall prevail. Subrecipient Administrator - HOME Consortium member(s) other than the non -Lead Entity who perform some HOME administrative roles as delineated under separate, specific HOME written Agreements. This term refers to the City of Kennewick and/or the City of Pasco. Tri -Cities HOME Consortium - The particular Consortium operating under the HOME Program consisting of the Cities of Kennewick, Pasco, and Richland. These three cities are each "Consortium Members." III. Agreement Section 2 — Use & Amount of HOME Funds Use of HOME At the Member's option, the allowable percentage (10%) of program Funds: income generated by the Subrecipient HOME activities may be used Administrative & by the Subrecipient to be applied towards eligible and allowable planning costs administrative costs. related to administering the Eligible administrative costs include: HOME Program and HOME projects Staff Costs: Salaries, wages, and related costs of Subrecipient staff persons responsible for HOME Program administration. Other Administrative Costs: • Goods and services necessary for administration (such as utilities, office supplies, etc.); • Administrative services under third party agreements (such as legal services); • Providing public information; • Fair housing activities; • Indirect costs under a cost allocation plan prepared in accordance with applicable OMB Circular requirements; • Preparation of the Consolidated Plan; and • Complying with other Federal requirements; NOTE: Some of the costs described above can be categorized as either a project -related soft cost or an administrative cost. Subrecipients must count each cost as either a project -related cost or an administrative cost, but may not count a cost as both. In other words, the Subrecipient cannot be reimbursed twice for the same HOME Subrecipient Agreement - Administrative Activities 2014 Page 3 of 14 Amount of HOME The Subrecipient may receive up to ten percent (10%) of the program Funds: income generated by HOME activities overseen and/or implemented by the Subrecipient. Administrative Administrative costs over the allowable percentage of program Costs Exceeding income are the responsibility of the Subrecipient. the Allowable 10% Section 3 — Disbursement of Funds (85.22) The Subrecipient may request funds under this Agreement only when a written agreement (24 CFR 92.504(c)) has been fully executed, the funds are needed for payment of specific allowable costs (24 CFR 92.206), and only in amounts needed to pay such costs as identified in 24 CFR 85.22. The Subrecipient shall provide clear documentation of administrative costs to be reimbursed by the HOME program. Documentation may include, but is not limited to, staff timesheets, description of administrative activities conducted by staff, and receipts for supplies and/or office rent. The Subrecipient shall be reimbursed for eligible administrative costs after review and approval by the Lead Entity of invoices, statements, billings, and other supportive documentation. Upon prior approval by the Lead Agency, the Consortium may pay a vendor or contractor directly. Section 4 — Subrecipient Administrator Responsibilities. The Subrecipient Administrator shall be responsible for the following: To supply to the Lead Entity, within fourteen (14) days after request, copies of all documents which the Lead Entity is required to submit to HUD, including, but not limited to, the Consortium Member's HOME -related Consolidated Planning Strategy and Annual Action Plan. To supply to the Lead Entity a written description(s) of their HOME program(s) prior to contracting with another entity to deliver the program(s). Lead Entity retains final approval and contracting authority. Descriptions should include: o copies of program description o listing of responsible staff for each step in the delivery of the program o methods of affirmative marketing o methods of procurement o steps taken and standards imposed for the application and review process leading to the award of funds • To utilize Consortium -approved forms, policies, and procedures. • To affirmatively further fair housing in their jurisdictions. Such actions may include planning, education, outreach, and enforcement activities. • To provide quarterly and annual performance reports to the Lead Entity regarding HOME activities. • To provide other documents as required by separate HOME written agreements governing relationship between the Lead Entity and Members acting as Subrecipient Administrators. HOME Subrecipient Agreement - Administrative Activities 2014 Page 4 of 14 Section 5 — Relationship The relationship of the Subrecipient to the Consortium shall be that of an independent agency. Nothing herein shall be deemed to create the relationship of employer/employee or principal/agent between the parties. Section 6 — Modifications and Amendments This Agreement may only be amended in writing signed by the Consortium and the Subrecipient. All modifications and amendments to this Agreement shall be in writing; such modification or amendment shall not take effect until specifically approved in writing by the Lead Entity of the Consortium and signed by all parties to this Agreement. Section 7 — Waivers No conditions or provisions of this Agreement shall be waived unless approved by the Consortium in writing. Section 8 — Assignment The Subrecipient shall not assign any interest in this Agreement, and shall not transfer any interest in this Agreement to any party (whether by assignment or novation) without prior written consent of the Consortium. Section 9 — Severability If any provision of this Agreement, or portion thereof, is held invalid by any court of rightful jurisdiction, the remainder of this Agreement shall not be affected, providing the remainder continues to conform to applicable Federal and State law(s) and regulations and can be given effect without the invalid provision. Section 10 — Insurance and Bonds The Subrecipient and its employees, volunteers, contractors or consultants shall carry throughout the life of this Agreement, General Liability Insurance, Comprehensive Automobile Liability Insurance and other such coverage as may be appropriate or required by State or Federal law, for the services to be performed. This insurance shall include the following: Professional Legal Liability: Subrecipient shall maintain Professional Legal Liability or Professional Errors and Omissions coverage appropriate to the Subrecipient's profession and shall be written subject to limits of not less than $1 million per claim and $1 million policy aggregate limit. The coverage shall apply to liability for a professional error, act, or omission arising out of the scope of the work for this Agreement. Coverage shall not exclude bodily injury, hazards, or property damage related to the work in this Agreement, including testing, monitoring, measuring operations, or laboratory analysis where such services are rendered as part of the Agreement. HOME Subrecipient Agreement - Administrative Activities 2014 Page 5 of 14 2. Worker's Compensation (Industrial Insurance): Workers' Compensation insurance as required by Title 51 RCW shall be maintained, and Subrecipient shall provide evidence of coverage if so required. 3. Commercial General Liabilitv: Commercial General Liability coverage shall be written on ISO occurrence form CG 00 01 and shall cover liability arising from premises, operations, independent contractors, personal injury and advertising injury. The insurance shall include the Consortium, its members, officers, officials, employees and agents with respect to performance of services, and shall contain no special limitations on the scope of protection afforded as an additional insured. If this Agreement is over $50,000 then Employers Liability Coverage shall also be maintained. Coverage shall include limits of not less than $1 million per occurrence, and $2 million aggregate. 4. Automobile Liability: Business Automobile Liability insurance with a minimum combined limit no less than $1 million per accident for bodily injury and property damage shall be maintained. Coverage shall include owned, hired, leased, and non -owned automobiles. Coverage shall be written on Insurance Services Office (ISO) form CA 00 01 or a substitute form providing equivalent liability coverage. If deemed necessary, the policy shall be endorsed to provide contractual liability coverage. Insurance is to be placed with insurers with a current A.M. best rating of not less than A: VII. Subrecipient shall furnish the Consortium with original certificates and a copy of the amendatory endorsements, including but not necessarily limited to the additional insured endorsement, evidencing the insurance requirements prior to the commencement of the work. The insurance coverage shall be primary with respect to any insurance or self-insurance covering the Consortium, its members, elected and appointed officers, officials, employees and agents. Any insurance, self-insurance, or insurance pool coverage maintained by the Consortium shall be excess of the Subrecipient's insurance and shall not contribute with it. Subrecipient shall give 30 days' prior written notice by certified mail, return receipt requested, to the Consortium prior to any attempt to cancel any insurance policy maintained under this Agreement. Section 11 — Procurement Standards (84.40-48 Non Profit or 85.36(b) Government) If applicable to its HOME administration activities, the Subrecipient will establish procurement procedures to ensure that materials and services are obtained in a cost-effective manner. At a minimum, the Subrecipient shall comply with the nonprofit procurement standards at 24 CFR 84.40-48, or 24 CFR 85.36(b) for governmental entities. Section 12 — Conflict of Interest (92.356) Generally, no employee, agent, member, consultant, officer or elected or appointed official of the members in the Consortium or Subrecipient who exercises or has exercised any functions or responsibilities with respect to any activities that are in any way connected with the decision to provide the HOME Funds may obtain a financial interest, reside in, or benefit from those activities, or have an interest in any contract, subcontract or agreement with respect thereto, or the proceeds thereunder, either for themselves or those with whom they have family or business ties, during their tenure or for one year thereafter as stated in 24 CFR 92.356, and the Subrecipient must take appropriate steps to assure compliance. HOME Subrecipient Agreement - Administrative Activities 2014 Page 6 of 14 Section 13 — Records (92.508) Records documenting time and costs related to HOME administration must be kept which demonstrate compliance with this Agreement and related regulations of the HOME Program 24 CFR 92. Records must be kept by the Subrecipient and be made available to the Consortium that demonstrate compliance with this Agreement and with 24 CFR 92.508. Records must be maintained for at least five (5) years after expenditure of administrative funds, except when any of the following apply: Records that are the subject of audit findings must be retained for three (3) years after such findings have been resolved; 2. Records for non -expendable property (as defined in OMB Circular #A-110 for non-profit organizations) shall be retained for three (3) years after final disposition of the property. If any litigation, claim, negotiation, audit, monitoring, inspection or other action has been started before the expiration of the required record retention period, records must be retained until completion of the action and resolution of all issues which arise from it, or until the end of the required period, whichever is later. Upon request, the Subrecipient agrees to immediately provide to the Lead Entity any and all information to document compliance with the HOME Program and related laws, rules, regulations and policies. Section 14 — Public Records The Subrecipient understands that this Agreement is subject to public records disclosure pursuant to RCW 42.56 and agrees to timely provide documents as required by law. The Subrecipient shall indemnify, defend and hold harmless the Lead Entity of the Consortium for any liability arising out of the Subrecipient's failure to produce public records as required. Section 15 — Monitoring At least annually, or more often if deemed necessary, the Lead Entity will monitor the performance of the Subrecipient to assure compliance with the requirements of this Agreement. The review may include on-site inspections and review of records to determine compliance with this Agreement through the contract period. Monitoring forms primarily used can be found at: httr):/Iportal.hud.gov/hudr)ortal/HUD?src=/I)rogram offices/administration/hudclios/handbooks/cod/6509 2 Chapter 7 for the HOME Investment Partnership Program. The Subrecipient agrees to provide any and all information to the Consortium to assist in meeting administrative and monitoring requirements. The Subrecipient agrees to work cooperatively with the Consortium to assist in meeting its obligations to HUD. HOME Subrecipient Agreement - Administrative Activities 2014 Page 7 of 14 Any duly authorized representative of the U.S. Department of Housing and Urban Development, authorized federal or state agent, or the Consortium shall at all reasonable times have access to and the right to inspect, copy, audit, and examine all books, records and other documents relating directly to the Subrecipient's receipt and disbursement of the HOME funds. The Subrecipient agrees to immediately correct any deficiencies as noted by the Lead Entity, HUD, and/or other authorized entities. Section 16 — Financial Responsibility & Timeliness of Reimbursement Requests The Subrecipient agrees that it is financially and legally responsible for any monitoring/audit exception which occurs due to its negligence or failure to comply with the terms of this Agreement and/or HOME regulations. The Subrecipient acknowledges that failure to submit reimbursement requests with all appropriate supportive documentation within 120 days of incurring administrative costs shall result in those costs becoming the financial responsibility of the Subrecipient. Section 17 — Indemnification The Subrecipient will save and hold harmless and indemnify the Lead Entity against any and all liability, claims and costs of whatever kind and nature for injury to or death of any person or persons, and for loss or damage to any property, occurring in connection with or in any way incident to or arising out of activities undertaken under this Agreement. Further, Subrecipient shall reimburse the Lead Entity for all costs incurred in connection with a negative audit finding resulting from Subrecipient's negligent or willful mismanagement of HOME funds, or its negligent or willful disregard for the laws, rules and regulations governing the HOME Investment Partnership Program. Section 18 — Corrective and Remedial Action Subrecipient will immediately correct or cause to be immediately corrected any and all actions or performance deficiencies in the project as may be determined by the Lead Entity, or the U.S. Department of Housing and Urban Development (HUD). Failure to correct such actions or performance deficiencies within thirty (30) days from written notification from the Lead Entity may result in suspending the disbursement of HOME administrative funds, suspending all HOME funded projects, cancellation of this contract and other HOME Program contracts, reprogramming of HOME funds to other eligible activities, and/or repayment of the HOME funds by the Subrecipient from non-federal sources. Section 19 — Attorney's Fees -Costs In the event of a lawsuit between the parties to this Agreement, the prevailing party shall be entitled to recover judgment against the other party for reasonable attorney's fees and other costs either at trial or on appeal. If either party exercises any non -judicial right or remedy to enforce such party's rights hereunder, it shall be a condition for the cure of the default that the defaulting party will pay the non -defaulting party's reasonable attorney's fees incurred and all reasonable costs. Failure to pay such costs and reasonable attorney's fees shall constitute an event of default under this Agreement. Section 20 — Venue and Law HOME Subrecipient Agreement - Administrative Activities 2014 Page 8 of 14 Except where federal law controls, this Agreement shall be governed by the laws of the State of Washington. Venue for any action under this contract shall be in Benton County, Washington. Section 21 — Suspension or Termination of Agreement The Consortium may cancel this Agreement "for cause" or "not for cause" by providing written 30 days' notice by certified mail, return receipt requested, to the other signatory members of this Agreement. There are three (3) separate methods of suspension or termination of this Agreement: i. By fulfillment. The Agreement will be considered to be terminated upon fulfillment of its terms and conditions. By mutual consent. The Agreement may be terminated or suspended in whole or in part, at any time, if both parties consent to such termination or suspension. The conditions of the suspension or termination shall be documented by giving a minimum of 30 days' written notice. iii. For cause. The Consortium may suspend or terminate this Agreement in whole or in part, for cause, when the Subrecipient has failed in whole or in part to meet its commitments and obligations as outlined, and when the Consortium deems continuation to be detrimental to its interest. Failure to carry out the project as described and in compliance with HOME Program regulations found at 24 CFR 92 will be deemed a failure to perform, and cause the immediate relinquishment of any interest in future HOME funds and/or require repayment of expended HOME funds. In the event of suspension, the Consortium will notify the Subrecipient in writing of the corrective action required. Further payment may be withheld at the Consortium's discretion until the Subrecipient causes corrective action or the Agreement is terminated. "For cause" includes: a. failure to comply with the terms and conditions of this Agreement, or to substantiate compliance; b. Improper or illegal use of project funds or resources; C. Any illegal act by the Subrecipient and its representatives. Failure to submit required reports on or before due date or failure to document compliance with the terms and conditions contained herein. In the event of termination, the Lead Entity will notify the Subrecipient in writing of its determination to terminate, the reason for such termination, and the effective date of the termination. Payments made to the Subrecipient or recoveries by the Consortium will be in accordance with the legal rights and liabilities of the parties. Recoveries include all HOME funds on hand at the time of Agreement termination, any accounts receivable attributable to the use of HOME funds, and any other assets acquired with HOME funds. HOME Subrecipient Agreement - Administrative Activities 2014 Page 9 of 14 Actions by either party under this article shall not constitute a waiver of any claim by either party arising from conditions or situations leading to such suspension or termination. HOME funds not committed to specific projects as of the cancellation date will be relinquished to the Consortium for redistribution to other qualified projects. Section 22 — Dispute Resolution The Lead Entity and the Subrecipient agree to negotiate in good faith for a period of 30 days from the date of notice of all disputes between them prior to exercising their legal rights under this Agreement or other law. All disputes not resolved by negotiation between the parties may be arbitrated only by mutual agreement of the parties. If not mutually agreed to resolve the claim by arbitration, the claim will be resolved by legal action. Arbitration of all claims will be in accordance with the RCW 7.04A and the mandatory rules of arbitration with venue being placed in Benton County, Washington. Arbitration shall include an award to the prevailing party of its reasonable attorney fees and costs in action against the other. Section 23 - Debarment and Suspension (2 CFR 2424) The Subrecipient may not award or permit an award of a contract to any party which is debarred, suspended or ineligible to participate in a federal program. The Subrecipient certifies that it is not debarred, suspended or ineligible to participate in a federal program. The Subrecipient will submit to the Consortium the names of contractors and any subcontractors prior to signing contracts to ensure compliance with 24 CFR Part 24, "Debarment and Suspension." The Subrecipient will also assure that language pertaining to debarred, suspended or ineligibility to participate is inserted in all contract agreements. If, during the time of this Agreement, the Subrecipient is debarred, suspended or ineligible to participate in a federal program, the Consortium may terminate this Agreement for cause. Section 24 — Financial Management and Audits (92.506) The Subrecipient shall adhere to the generally accepted accounting principles and procedures issued by the American Institute of Certified Public Accountants, and will utilize adequate internal controls and maintain necessary source documentation for all costs incurred. The Subrecipient shall comply with cost principles as established by OMB Circulars A-87, relocated to 2 CFR, Part 225, and with administrative requirements at A-102 if a state, local government, or Indian tribe. If the Subrecipient is a non-profit organization, it will comply with cost principles of OMB Circular A-122, relocated to 2 CFR, Part 230, and administrative requirements established at OMB Circular A-110. All costs must be reasonable and necessary. The Subrecipient shall also comply with auditing standards issued by the Comptroller General of the United States and be conducted in accordance with 24 CFR 84.26 and 85.26. All subrecipients who expend $500,000 or more in a year in federal awards, whether a direct subrecipient of this Agreement or a sub-subrecipient receiving federal funds through a pass- through entity, shall have a single audit conducted for that year in accordance with the provision of OMB A-133, Subpart B. When a Subrecipient expends federal awards under only one federal program, excluding Research and Development performed by a non-federal entity, and the program's laws, regulations, or grant agreements do not require a financial statement audit, the subrecipient may elect to have a program -specific audit conducted in accordance with Subpart B, Section 235. A program -specific audit may not be elected for Research and Development HOME Subrecipient Agreement - Administrative Activities 2014 Page 10 of 14 unless all of the federal awards expended were received from the same federal agency, or the same federal agency and the same pass-through entity, and that federal agency, or pass- through entity approves in advance a program -specific audit. The audit must be conducted within 60 days of completion of this Agreement. Non-federal entities who expend less than $500,000 a year in federal awards are exempt from federal audit requirements for that year, except this does not limit the authority of federal agencies, including HUD, Inspectors General, or General Accounting Office to conduct or arrange for additional audits. All records shall be made available for review or audit by appropriate local, state and federal entities. Section 25 — DUNS Number A Dun and Bradstreet Data Universal Numbering System (DUNS) number is required for any business or agency that receives federal assistance per the Federal Funding Accountability and Transparency Act of 2006 (FFATA). The Subrecipient will provide information on itself, will assure that all assisted agencies/businesses have been assigned a DUNS number, and shall provide this information to the Lead Entity. A free DUNS number may be requested via the web at http://fedqov.dnb.com/webform/index.*sp or by calling 1-866-705-5711. Section 26 — SAM Registration The Federal Funding Accountability and Transparency Act of 2006, as amended (FFATA) requires the Office of Management and Budget (OMB) to maintain a single, searchable website that contains information on all federal spending awards. As part of this, all agencies/businesses that meet the following thresholds must register in SAM and report to the Consortium if they had: a) A gross income from all sources over $300,000 in the agency's previous tax year; and b) Are awarded HOME funds of $25,000 and over. This information must be reported to the Consortium within five (5) days of signing this Agreement. Free registration can be obtained at https://www.sam.gov/portal/public/SAM/. Because this registration expires annually, it must be updated and kept current during the contract period. The Subrecipient will provide information on itself and will assure that all assisted agencies/businesses have registered and remain current in SAM. Additional information is required if more than 80% of annual gross revenues of $25 million or more come from the federal government, and employee and compensation information is not already available through reporting to the SEC. Section 27 — Reversion of Assets Upon expiration of this Agreement, any HOME funds or accounts receivable that can be attributed to the use of HOME funds will revert to the Lead Entity of the Consortium. Should the Consortium Member stop participating in consortium programs or fail to perform in compliance with program requirements, assets are subject to reversion to the Lead Entity. Section 28 — Drug Free Workplace HOME Subrecipient Agreement - Administrative Activities 2014 Page 11 of 14 In accordance with the Drug Free Workplace Act of 1988, Subrecipient will, or will continue to, provide a drug-free workplace by: 1. Publishing a statement notifying employees that the unlawful manufacture, distribution, dispensing, possession, or use of a controlled substance is prohibited in the workplace, and specifying the actions that will be taken against employees for violation of such prohibition; 2. Establishing an ongoing drug-free awareness program to inform employees about: a) The dangers of drug abuse in the workplace; b) The Subrecipient/employer's policy of maintaining a drug-free workplace; C) Any available drug counseling, rehabilitation, and employee assistance programs; and d) The penalties that may be imposed upon employees for drug abuse violations occurring in the workplace; 3. Making it a requirement that each employee to be engaged in the performance of the grant be given a copy of the statement required by paragraph 1; 4. Notifying the employee in the statement required by paragraph 1 that, as a condition of employment under the grant, the employee will: a) Abide by the terms of the statement; and b) No later than five (5) calendar days after such conviction, notify the employer in writing of his or her conviction for a violation of a criminal drug statute occurring in the workplace; 5. Notifying the agency in writing within ten (10) calendar days after receiving notice under subparagraph 4(b) from an employee, or otherwise receiving actual notice of such conviction. Employers of convicted employees must provide notice, including position title, to every grant officer or other designee on whose grant activity the convicted employee was working, unless the federal agency has designated a central point for the receipt of such notices. Notice shall include the identification number(s) of each affected grant; 6. Taking one of the following actions, within 30 calendar days of receiving notice under subparagraph 4(b), with respect to any employee who is so convicted: a) Taking appropriate personnel action against such an employee, up to and including termination, consistent with the requirements of the Rehabilitation Act of 1973, as amended; or b) Requiring such employee to participate satisfactorily in a drug abuse assistance or rehabilitation program approved for such purposes by a federal, state, or local health, law enforcement, or other appropriate agency; 7. Making a good faith effort to continue to maintain a drug-free workplace by implementation and enforcement of this article while carrying out all HOME Program - related activities. HOME Subrecipient Agreement - Administrative Activities 2014 Page 12 of 14 Section 29 — Anti -Lobbying Certification To the best of the signatory party's knowledge and belief No federal appropriated funds have been paid or will be paid, by or on behalf of it, to any person for influencing or attempting to influence an officer or employee of any agency, a member of Congress, an officer or employee of Congress, or an employee of a member of Congress in connection with the awarding of any federal contract, the making of any federal grant, the making of any federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any federal contract, grant, loan, or cooperative agreement; If any funds other than federal appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a member of Congress, an officer or employee of Congress, or an employee of a member of Congress in connection with this federal contract, grant, loan, or cooperative agreement, it will complete and submit Standard Form -LLL, "Disclosure Form to Report Lobbying," in accordance with its instructions; and The language of the above paragraphs of this anti -lobbying certification must be included in the award documents for all sub -awards at all tiers (including subcontracts, sub -grants, and contracts under grants, loans, and cooperative agreements) and all subrecipients/sub- subrecipients shall certify and disclose accordingly. The signatory parties are in compliance with restrictions on lobbying required by 24 CFR Part 87, together with disclosure forms, if required by that part. Section 30 — Uniform Administrative Requirements (92.505) Governmental subrecipients must comply with OMB Circular A-87 for determining allowable costs and the following sections of 24 CFR Part 85: 85.60 Additions and Exceptions 85.12 Special Grant or Subgrant Conditions for "high-risk" Grantees 85.20 Standards for financial management systems 85.22 Allowable costs 85.26 Non -Federal Audit 85.32 Equipment 85.33 Supplies 85.34 Copyrights 85.36 Procurement 85.44 Termination for Convenience 85.51 Later Disallowances and Adjustments 85.52 Collection of Amounts Due HOME Subrecipient Agreement - Administrative Activities 2014 Page 13 of 14 The Agreement will be effective upon the date of signing by the City of Richland, Lead Entity of the Tri -Cities HOME Consortium. SUBRECIPIENT: City of [Pasco/Kennewick] CONSORTIUM: Signature Print Name and Title APPROVED AS TO FORM: Heather Kintzley, City Attorney City of Richland Date Tri -Cities HOME Consortium P.O. Box 190, MS 19 Richland, WA 99352 Cynthia D. Johnson, City Manager Date City of Richland HOME Subrecipient Agreement - Administrative Activities 2014 Page 14 of 14 AGENDA REPORT NO. 37 FOR: City Council January 7, 2015 TO: Dave Zabell, City Manager FROM: Ahmad Qayoumi, Public Works Director Workshop Mtg.: 1/12/2015 Regular Mtg.: 1/20/2015 SUBJECT: Argent Road Widening Professional Services Agreement — Amendment No. 1 I. REFERENCE(S): 1. Argent Road Widening — Amendment No. 1 Summary Sheet 2. Argent Road Widening — Area Vicinity Map 3. Argent Road Widening —Argent Rd/Rd 36 Intersection Map II. ACTION REQUESTED OF COUNCIL / STAFF RECOMMENDATIONS: 1/12: Discussion 1/20: MOTION: I move to approve Amendment No. 1 to Professional Services Agreement with MacKay Sposito, continuing professional services with respect to the Argent Road Widening Project, in the amount of $13,905.29 and change the completion date to May 31, 2015 and further, authorize the City Manager to execute the agreement. HI. FISCAL IMPACT: Arterial Fund — $13,905.29 IV. HISTORY AND FACTS BRIEF: A) Argent Road is a principal arterial that provides vital east and west connection from 4th Avenue to Road 100. One section of the corridor (20'b Ave to Road 44) runs along Port of Pasco and Columbia Basin College property. B) In early 2011, the Port of Pasco and Columbia Basin College entered into discussions regarding the future of Argent Road and the needs of the Port of Pasco, Pasco Airport, the Fire Department, Columbia Basin College and the City as the area grows and additional demand is placed on the corridor. C) In October 2011, the City entered into an agreement with MacKay Sposito to deliver a conceptual design development phase for the corridor from 20" Ave to Road 44. The concept development scope included road widening to five lanes to meet the future and current needs of the area, landscaping, bike lanes and access management. D) Through a number of interactions and meeting with the Port of Pasco and Columbia Basin College, a final concept plan was developed. E) City staff allocated federal funds in the amount of $200,000 for the design of the project. V. DISCUSSION: A) During the design phase of the project a traffic study was completed for the Argent Road Corridor from 20"' Avenue to Rd 44. This traffic study showed that all warrants are met for a new signal to be installed at the intersection of Argent Rd and Rd 36. At the time of the original contract it was not known if a new signal would be warranted at this location, so the design cost of this new signal was not included in the original contract. The work needed for this design was shown as an optional task 15 in the original scope of work in the event that a traffic study was needed at the intersection. The new traffic signal will improve safety and traffic flow through the corridor. Design cost for this addition work will be $13,905.29. B) The original Professional Services Agreement was scheduled to begin April 1, 2013 and end December 31, 2014. Due to unexpected delays in the project, outside of the consultant's control, and the addition of a new traffic signal, the design of the project is anticipated to be completed by May 31, 2015. C) It is the City's goal to construct the traffic signal as Phase I, while seeking available grants to complete the road improvements. 4(e) MacKay sposito To: CITY OF PASCO Attn: Ahmad Clayoumi City of Pasco 525 N. 3id Avenue Pasco, DATE: NOVEMBER 20, 2014 CHANGE ORDER # 2 FOR: 15620 Argent Road Widening Project All terms and conditions of Contract dated May 18, 2013 shall apply to this authorization to provide necessary professional services and professional costs to perform the following task(s). Per the signed contract, extra services will be billed on a time -and -materials basis. However, for budgeting purposes an estimated date and cost to complete the tasks are provided below. DESCRIPTION / SCOPE OF CHANGE ORDER AMOUNT Task 15.0 Signal Design for Argent Road and Road 36 Intersection (Final Design) as previously proposed in original contract. $13,905.29 TOTAL 1 $13,905.29 OriginalContract Amount......................................................................................................................................... $225,416.00 Previous Change Orders Subtotal.............................................................................................................................. $1,712.00 Total Contract Amount to Date.................................................................................................................................. $ 227,128.00 CurrentChange Order Amount................................................................................................................................ $13,905.29 RevisedContract Amount......................................................................................................................................... $ 241,033.29 Estimated Completion Date: March 31, 2015 Work Authorized By: CLIENT REPRESENTATIVE SIGNATURE Printed Name: Work Authorized By: /�j".r✓,/ )iIACKAY&POirTO REPRESENTATIVE SIGNATURE COMPANY Date: Printed Name: PRfn✓ HA72-ms&A/ Date: II�l,`r�Z0 www.mackaysposito.com Z O F= U LU U) w Ill 0- Z Z Q Z � M } �Z od U C,> H Z W U Q AGENDA REPORT NO. 29 FOR: City Council TO: Dave Zabell, City Manager k-45 Ahmad Qayoumi, P.E., Public Works Director FROM: Kent McCue, Interim Engineering Manager l" SUBJECT: 90'& Washington Lift Station VFD Equipment I. REFERENCE(S): 1. 9h & Washington VFD Equipment - Proposed Resolution 2. 9"& Washington VFD Equipment - Price Quote 3. 9" & Washington VFD Equipment — Memo January 8, 2015 Workshop Mtg.: 1/12/15 Regular Mtg.: 1/20/15 H. ACTION REQUESTED OF COUNCIL / STAFF RECOMMENDATIONS: 01/12: Discussion 01/20: MOTION: I move to approve Resolution No. , waiving competitive bidding requirements and approving the purchase of Variable Frequency Drive (VFD) units and the Programmable Logic Controller (PLC), and approving install of the equipment. III. FISCAL IMPACT: Sewer Funds IV. HISTORY AND FACTS BRIEF: A) The Public Works Department Plan Division is requesting the installation of new Allen-Bradley Variable Frequency Drive (VFD) units, Programmable Logic Controllers (PLC), and associated electrical appurtenances for controlling the pumps in the 9h & Washington Sanitary Sewer Lift Station. A VFD is a type of adjustable -speed drive used in the electro -mechanical drive systems to control AC motor speed and torque by varying motor input frequency and voltage. The PLC is the "brain" behind the entire lift station control and functionality. The unit monitors wet well levels which sends a message to the VFDs to start, stop, ramp up/down, cycle pumps, etc. B) Plant Division staff has been experiencing equipment failure on several occasions during the past year. The existing equipment is old (installed in 1997), has been rebuilt on at least two occasions, and is now beyond reasonable repair and is considered functionally obsolete. C) Failure of one or more of the VFD units could yield the Lift Station inoperable, create sewer flow backups in the system, and result in an emergency/potentially catastrophic event. The majority of city wide sanitary sewer flows through this lift station prior to its discharge to the wastewater treatment plant. D) The initial installation of the equipment was completed by H&N Electric, a local company. They have also provided all of the maintenance and repairs during the lifetime of the equipment. The configuration of the existing system was specifically developed to conform to the electrical and control systems used by the City. V. DISCUSSION: A) Allen-Bradley equipment is the current standard being used for City of Pasco Water and Wastewater electrical plant equipment to increase serviceability and functionality. With Allen- Bradley equipment the City would own the operating software and be able to make changes when needed and not have to hire an outside contractor. B) The Allen-Bradley PLC's do not use proprietary "black box" programming, which eliminates the strict dependence on the supplier for programming modifications. A new Allen-Bradley PLC will optimize controllability, maximize station capacity and increase station efficiency. C) The City's Instrument Technician is fluent in Allen-Bradley software and programming; and Allen-Bradley technicians are available locally through H&N Electric. H&N Electric originally built the current panels and system and has serviced these units for the past 17 years. Using H&N Electric will save time and money as they would not have to re-engineer the project. Additionally, H&N Electric has the VFD specialist who worked on the initial build of the current VFD's and who has performed the work on the system since its installation. D) Original funding for this project was slated under 2014's maintenance budget. In late January 2015 the funds will be reallocated through a supplemental budget request. 4(f) RESOLUTION NO. A RESOLUTION WAIVING COMPETITIVE BIDDING REQUIREMENTS FOR THE PURCHASE OF NEW VARIABLE FREQUENCY DRIVES (VFDs) AND ALLEN -BRADLEY PROGRAMMABLE LOGIC CONTROLLER (PLCs) AND AUTHORIZING THE PURCHASE AND INSTALLATION OF SAID EQUIPMENT BY H&N ELECTRIC. WHEREAS, the existing VFDs are becoming unreliable due to age and lack of spare parts, and must be replaced to maintain proper operation, and WHEREAS, the City is now considering conversion to Allen-Bradley equipment to increase serviceability and functionality, whenever existing outdated equipment is routinely replaced, and WHEREAS, it is functionally desirable for the City to be able to own the operating software and for City staff to be able to make changes when needed for ease of maintenance and efficiencies in order to facilitate consistent and dependable operations, and WHEREAS, the purchase of VFDs and Allen-Bradley PLCs will allow the City to reduce the costs of operation, maintenance and repair, and the inventory of parts by having one system that is easily programmable from a remote location, and WHEREAS, H&N Electric installed and has provided all of the maintenance on the existing equipment and system, and WHEREAS, pursuant to RCW 39.04.280 H&N Electric is the sole source of the VFDs and Allen-Bradley PLCs that are interchangeable with the equipment already installed, and the sole source that will allow the City to interchange equipment; NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PASCO, that the City Council does hereby declare that the purchase of VFDs and Allen-Bradley PLCs is clearly and legitimately limited to a single source of supply, and that the sole source of supply is H&N Electric, and BE IT FURTHER RESOLVED, that the competitive bidding requirements for the City of Pasco are hereby waived and the Pasco Public Works Department is authorized to purchase VFDs and Allen-Bradley PLCs from H&N Electric who will install said equipment for the sum of $ PASSED by the City Council of the City of Pasco this 19th day of January, 2015. Matt Watkins Mayor ATTEST: Debra L. Clark City Clerk APPROVED AS TO FORM: Leland B. Kerr City Attorney Kent McCue From: Barney, Kim M. <kbarney@hnelectric.com> Sent: Friday, September 26, 2014 2:51 PM To: Todd Marden Subject: RE: Contractor Good afternoon Todd, Below is a re -quote based on the quote of Aug. 29th to Brett C. and adding a line item for installation. Let me know if you need anything further. We are looking forward to helping you complete this project! Regards, Kim Brett, We basically finished with the design work for the 4 retrofit UL assemblies for 9th & Washington. I know this took a bit longer than I had hoped, but Mike and Steve had to make sure all the issues related to the retrofit were addressed, of which there were quite a number. Anyway, I think we have a tentative 'final design" that will work like you want. Here are costs for the basic assemblies/back panels, which would have all the components for a complete working system once installed. 1) 75hp, UL Back panel assembly, w/New SVX9000, 75hp CT1100hp VT Drive, Nema 1, input fusing, w/remote keypad kit, adapter plate, control power transformer, Thermostat (cooling), output filter, terminals/relays as required $ 11,240.00 ea. (x 2 ) 2) 150hp, UL Back panel assembly, w/New SVX9000, 125hp CT/150hp VT Drive, Nema 1, input fusing, w/remote keypad kit, adapter plate, control power transformer, Thermostat (cooling), output filter, terminals/relays as required $15,454.00 ea. 3) 150hp, UL Back panel assembly, w/ New SVX9000, 125hp CT/150hp VT Drive, Nema 1, w/ New 5811, Solid State Starter Bypass (3 contactor), w/remote keypad kit adapter plate, control power transformer, Thermostat (cooling), output filter, 24VDC Power supply, terminals/relays as required $11,817.00 ea. 4) Installation of the 4 pre -assembled Back Panels above. Includes all work @ prevailing wage, electrical permit. $ 17,950.00 Total for 4 drive packages and install - $ 79,701.00 Regards, Kim Kim Barney Electrical Services Manager H & N Electric—A Timken Brand 4224 E. B Street Pasco, Washington 99301 PH: (509) S47-1691, EXT: 739 Memo To: Dave Zabell, City Manager Ahmad Qayoumi, PE, Public Works Director From: Michael A. Pawlak, PE, City Engineer Date: November 18, 2014 Public Works Department Engineering Division Re: 9''& Washington Lift Station Programmable Logic Controller (PLC) Equipment— Sole Source Introduction. The Public Works Department Plant Division has requested the installation of a new Programmable Logic Controllers (PLC), and associated electrical appurtenances for controlling the pumps in the 9"' & Washington Sanitary Sewer Lift Station. (A programmable logic controller, PLC or programmable controller is a digital computer used for automation of typical industrial electro -mechanical processes, such as control of machinery on factory assembly lines, amusement rides, or light fixtures. PLCs are used in many industries and machines.) Plant Division staff has been experiencing equipment failure at the Lift Station, on several occasions during the past year. Staff has determined that it is necessary to update the existing controller equipment. Evaluation. Plant Division staff has been experiencing failure of the Variable Frequency Drives (VFDs) that drive the pumps at the Lift Station on a more frequent basis over the past year. The PLC is the "brain" behind the entire lift station control and functionality. Members of the Engineering Division have had numerous conversations with Derek Benningfield regarding the use of various manufactured Programmable Logic Controllers (PLCs) at City of Pasco water and wastewater facilities. Derek has suggested that we migrate from the use of Siemens PLC equipment to Rockwell's Allen-Bradley PLC equipment on all new and remodel installations of the City's supervisory control and data acquisition (SCADA) system. Upon listening to Derek's rationale and conferring with Murray Smith and Associates (the City's Consultant on the Columbia Water Supply Intake Project), a recommendation was made to City Council to sole source Allen-Bradley PLCs on that project. That recommendation was approved by Council on November 3, 2014. Either brand of PLC is likely reliable and capable of operating the City's SCADA system, as evidenced by the fact that the City has owned and operated equipment from both manufacturers. The more significant issues concerning the City are the ease of maintenance/modification of the programming software and the availability of outside support in the event City staff cannot correct a problem within the system. Maintenance issues seldom seem to be concerned with which PLC is actually in use, but rather with how easy it is to understand the operating program and how the affected instruments and separate components are attached to the system. For SCADA system 0 Page 1 maintenance personnel, software is very essential and needs to be straightforward, readily usable, and easily modified. The product supplied by Siemens does not provide these features. As in many regions of the United States, it is hard to find local Siemens support talent. Our current use of Siemens equipment requires a sole source maintenance arrangement with S&B, Inc., located in Bellevue, Washington. Additionally, S&B uses proprietary programming within a "black box" which leaves the City further dependent upon them for subsequent modifications to the PLC coding. By definition, S&B's on-site response time from Bellevue is often less than ideal and does not satisfy the immediate needs of continuously maintaining a reliable municipal system. Conversely, as Rockwell's Allen-Bradley has always been viewed in the U.S. as the benchmark for easy to use software, experienced local support for Allen-Bradley PLC installations is more readily available. In addition, the City's Instrumentation Technician has 15 years of experience working with Allen-Bradley equipment and can personally modify the open sourced programming of these PLCs to better match the needs of the City's water/sewer/irrigation support personnel. All future instrumentation technicians hired by the City will also have (or receive training) the ability to work with the open source code of the Allen-Bradley PLCs. The SCADA system at the City's Process Water Reuse Facility (PWRF) is a prime example of an in- house success story. During construction of the recent expansion project, Allen-Bradley PLCs were substituted for the previously specified Siemens PLCs. Since completion of the project, the City's Instrumentation Technician has, performed numerous small adjustments to the control logic programming at the request of the PWRF staff, in order to fine tune the operation of the facility. Utilization of S&B to perform these modifications on a propriety Siemen's system would have likely been both more time consuming and costly. Responses to the Sole Source Worksheet questions. The following are responses to the Sole Source Worksheet developed by the City Attorney for the purposes of ensuring that a reasonable and rationale evaluation is conducted in accordance to WA State Law for these types of purchases. 1. Please describe the items and its function: The 9t' and Washington Lift Station pumps approximately 75% of Pasco's wastewater through the system and to the Wastewater Treatment Plant. The existing VFDs that control the pumps are experiencing periodic failure (which often precedes complete failure); a failure of one or more of those units would yield the Lift Station inoperable, create sewer flow backups in the system, and result in an emergency / potentially catastrophic event including but not limited to potential discharge of raw sewage to the Columbia River. The PLC is the "brain" behind the entire lift station control and functionality. This unit monitors wet well levels which sends a message to the VFD's to start, stop, ramp up/down, cycle pumps etc. The existing PLC is nearly 20 years old and functionally obsolete. A new updated Allen-Bradley PLC will optimize controllability, maximize station capacity and increase station efficiency. 0 Page 2 2. This is a sole source because: (a) Sole provider of items that are compatible with existing equipment, inventory systems, programs or services. (b) Sole provider of goods or services that will meet the specialized needs of the City or perform the intended function. The more significant issues concerning the City are the ease of maintenance/modification of the programming software and the availability of outside support in the event City staff cannot correct a problem within the system. Maintenance issues seldom seem to be concerned with which PLC is actually in use, but rather with how easy it is to understand the operating program and how the affected instruments and separate components are attached to the system. For SCADA system maintenance personnel, software is very essential and needs to be straightforward,. readily usable, and easily modified. The product supplied by Siemens does not provide these features. As in many regions of the United States, it is hard to find local Siemens support talent. Our current use of Siemens equipment requires a sole source maintenance arrangement with S&B, Inc., located in Bellevue, Washington. Additionally, S&B uses proprietary programming within a "black box' which leaves the City further dependent upon them for subsequent modifications to the PLC coding. By definition, S&B's on-site response time from Bellevue is often less than ideal and does not satisfy the immediate needs of continuously maintaining a reliable municipal system. 3. What necessary features does this vendor provide which are not available from other vendors? The more significant issues concerning the City are the ease of maintenance/modification of the programming software and the availability of outside support in the event City staff cannot correct a problem within the system. Maintenance issues seldom seem to be concerned with which PLC is actually in use, but rather with how easy it is to understand the operating program and how the affected instruments and separate components are attached to the system. For SCADA system maintenance personnel, software is very essential and needs to be straightforward, readily usable, and easily modified. The product supplied by Siemens uses proprietary programming within a "black box' which leaves the City further dependent upon them for subsequent modifications to the PLC coding. Why use Allen-Bradley PLC: • City-wide we are converting to Allen-Bradley from Siemens to increase serviceability and functionality. Siemens (S&B programming) is proprietary software to which we do not own the rights. With Allen-Bradley electrical equipment, we would own the operating software and be able to make changes when needed and not have to hire an outside contractor to do so; • There are fewer technicians that work on Siemens products compared to Allen-Bradley; • Allen-Bradley technicians are available locally; • Page 3 • City of Pasco's instrument technician is fluent in Allen-Bradley software and programming; • The City is currently using Allen-Bradley equipment in the following locations: Ultraviolet Disinfection Building, Headworks Building, Rotating Drum Thickener VFD's at the Wastewater Treatment Plant, East Side Booster Pump Station, Foster Wells Road Lift Station, Industrial Pump Station at the Process Water Reuse Facility, and the Pall water treatment system at the West Pasco Water Plant. • The City is currently in the process of installing Allen-Bradley equipment at: Harris Road Irrigation Pump Station, Butterfield Water Treatment Plant, Riverview Pump Station, and the Maitland Sanitary Sewer Lift Station. 4. What steps were taken to verify that these features are not available elsewhere? Other brands/manufacturers were examined. Public Works staff has used both Allen-Bradley and Siemens equipment and have found the Allen-Bradley equipment more desirable due to: • technical support is more readily available (and local), • equipment is easier to operate and maintain, • equipment & controls are more flexible and can be adjusted by in-house staff (Siemens software is proprietary and can only be adjusted by a Siemens technical support staff member), 5. Sole source vendor certifies that the City is getting the lowest price offered for this item. On previous installations, Allen-Bradley PLC equipment has been competitive with similar products from Siemens. The City will solicit bids for the furnishing and installation of the equipment through an open bidding process to provide for overall competition. Recommendation. Staff recommends that the City of Pasco sole source the purchase of a new Allen-Bradley Programmable Logic Controller (PLC) for the 9`" & Washington Sewer Lift Station through a competitive bid solicitation for the furnishing, installation, and initial programming of the PLC and associated equipment. • Page 4 Memo To: Dave Zabell, City Manager Ahmad Qayoumi, PE, Public Works Director From: Michael A. Pawlak, PE, City Engineer Date: November 17, 2014 Public Works Department Engineering Division Re: Yh & Washington Lift Station VFD Equipment — Sole Source Introduction. The Public Works Department Plant Division has requested the installation of new Variable Frequency Drive (VFD) units, and associated electrical appurtenances for controlling the pumps in the 9h & Washington Sanitary Sewer Lift Station. (A VFD is a type of adjustable -speed drive used in electro -mechanical drive systems to control AC motor speed and torque by varying motor input frequency and voltage.) Plant Division staff has been experiencing equipment failure on several occasions during the past year. The existing equipment is old (installed in 1997), has been rebuilt on at least two occasions, and is now beyond reasonable repair and is considered functionally obsolete. Evaluation. Plant Division staff has been experiencing failure of the VFDs on the smaller sized pumps at the Lift Station on a more frequent basis over the past year. The VFDs that control the larger (main) pumps are the same type of equipment and a failure of one or more of those units would yield the Lift Station inoperable, create sewer flow backups in the system, and result in an emergency / potentially catastrophic event. The current approved 2014 Public Works Department operating budget does include a line item for the replacement of this equipment. Staff continuously researches equipment, suppliers and technical support providers for the various pieces of equipment used in the wastewater treatment process, as the system is required to be functional and operational at all times. Outside consultants and contractors are routinely used to maintain and repair pumps, VFDs, electrical components, etc. H&N Electric (local company) completed the initial installation and has provided all of the maintenance and repairs during the lifetime of the equipment, for the 9'" & Washington Lift Station. The configuration of the existing system was specifically developed for that particular lift station to conform to the electrical and control systems used by the City. This request to sole source the purchase and installation of specific equipment is recommended based on the following points and more specifically addressed in the responses for the attached Sole Source Worksheet: 0 Page 1 • The current VFDs were installed more than 18 years ago, and are outdated, functionally obsolete, and experiencing breakdowns that could cause a potentially catastrophic event; • Replacement parts for the existing VFDs, which were readily available in the past are now becoming very difficult to locate due to the age of the equipment and the advent of newer technologies and improvements; • Cutler -Hammer "EATON" drives (VFDs) are a "like kind" replacement for the older existing units, and are similar as VFDs used throughout other Plant Division facilities in the City; • The Cutler -Hammer "EATON' drives are proven reliable pieces of equipment, used by the City in other facilities associated with wastewater treatment and discharge; • H&N Electric is familiar with the current system (having built, installed and maintained it for nearly 20 years), provides nearly immediate response time, will not need to "learn the installation' in order to make these upgrades, and therefore, would be more cost effective. Responses to the Sole Source Worksheet questions. The following are responses to the Sole Source Worksheet developed by the City Attorney for the purposes of ensuring that a reasonable and rational evaluation is conducted in accordance to WA State Law for these types of purchases. 1. Please describe the items and its function: The 9h and Washington Lift Station pumps approximately 75% of Pasco's wastewater through the system and to the Wastewater Treatment Plant. The existing VFDs that control the pumps are experiencing periodic failure (which often precedes complete failure); a failure of one or more of those units would yield the Lift Station inoperable, create sewer flow backups in the system, and result in an emergency / potentially catastrophic event including but not limited to potential discharge of raw sewage to the Columbia River. A VFD is a type of adjustable -speed drive used in electro -mechanical drive systems to control AC motor speed and torque by varying motor input frequency and voltage. The existing Cutler -Hammer drives have served the City well for more than 18 years. Historically, replacement parts have been readily available but have since become increasingly more difficult to obtain due to the age of the equipment. The proposed new replacement equipment will be a "like kind" replacement utilizing the same interfaces, operational protocols and features with which Plant Division staff are familiar. The Cutler -hammer equipment would be similar to other VFDs currently being used by the City in both Water and Wastewater operations. H&N Electric installed and configured the existing electrical/mechanical system in the 9h & Washington Lift Station to the customized specifications provided by the City nearly 20 years ago. While certain pieces of equipment are being updated, the overall system will remain intact. H&N has maintained, serviced and repaired the equipment since its installation. The company is uniquely qualified and knowledgeable with the equipment and system having maintained it since it was installed. 2. This is a sole source because: (a) Sole provider of items that are compatible with existing equipment inventory systems programs or services. 0 Page 2 (b) Cutler -Hammer "EATON" drives are "like kind" replacements for the existing drives, are compatible with the systems and pumps in the Lift Station and are consistent with the equipment currently in use in other City of Pasco Wastewater treatment and discharge facilities. While there are more than one provider who can install VFDs in facilities, H&N Electric is uniquely qualified in as much as the company installed to original custom- designed system and has exclusively maintained and repaired the equipment and operating systems for nearly 20 years. Any other installer would need to "learn the system" to replace the old VFDs. Staff believes that another installer would take additional time and costs would be greater. Possible downtime of the Lift Station would also likely be greater with another installer. Minimizing downtime during equipment replacement is extremely critical given the importance of the 9t' & Washington Lift Station to the City's overall wastewater conveyance and treatment system. I What necessary features does this vendor provide which are not available from other vendors? H&N Electric originally built the current panels and system; since we are reusing the cabinets and air conditioning ducting, it stands to reason that they will be able to retrofit the equipment and instrumentation in less time and money. H&N Electric has also serviced these units for more than 18 years; they know what Inputtoutputs are needed which will save time and money as they will not have to re-engineer the project. Finally, this provider has the VFD specialist who worked on the initial build of the current VFD's and who has performed the work on the system since its installation. Reason's for replacing VFD's: • Current VFD's are obsolete, parts are harder and more expensive to attain; • VFD's are becoming unreliable due to age and lack of spare parts; • Lift station needs to have reliable and serviceable equipment to maintain proper operation; and • New VFD's will be able to operate larger horsepower (HP) pumps to accommodate future growth. 4. What steps were taken to verify that these features are not available elsewhere? While there are more than one provider who can install VFDs in facilities, H&N Electric is uniquely qualified in as much as the company installed to original custom-designed system and has exclusively maintained and repaired the equipment and operating systems for nearly 20 years. Any other installer would need to "learn the system" to replace the old VFDs. Staff believes that another installer would take additional time and costs would be greater. Possible downtime of the Lift Station would also likely be greater with another installer. Minimizing downtime during equipment replacement is extremely critical given the importance of the 9'' & Washington Lift Station to the City's overall wastewater conveyance and treatment system. 0 Page 3 5. Sole source vendor certifies that the City is getting the lowest price offered for this item. H&N Electric has provided all of the maintenance and repair efforts on this equipment and has historically presented the City with competitive invoices. The City will include a certification statement in the contract agreement requiring H&N Electric to certify that the pricing for this work will be competitive (lowest price). Recommendation. Staff recommends that the City of Pasco sole source the purchase of new Cutler -Hammer "EATON' variable frequency drives (VFDs) and further contract with H&N Electric for the installation of this equipment and any appurtenances at the 9"' & Washington Lift Station. 0 Page 4 AGENDA REPORT No. 33 FOR: City Council January 8, 2015 TO: Dave Zabell, City Manager Ahmad Qayoumi, PE, Public orks Director FROM: Kent McCue, Interim Engineering Manager SUBJECT: Canter Club Estates Latecomers Agreement I. REFERENCE(S): Workshop Mtg.: 1/12/15 Regular Mtg.: 1/20/15 1. Canter Club Estates - Proposed Agreement 2. Canter Club Estates - Memorandum from Michael A. Pawlak, PE, City Engineer II. ACTION REQUESTED OF COUNCIL / STAFF RECOMMENDATIONS: 01/12: Discussion 01/20: Public Hearing MOTION: I move to approve the Latecomers Agreement water system extension agreement with J&J Kelly Construction, Inc. and, further, authorize the City Manager to sign the agreement. IH. FISCAL IMPACT: None IV. HISTORY AND FACTS BRIEF: A) The Owner of Parcel #118 501009, J&J Kelly Construction, Inc. (Jeff & Jennifer Kelly) constructed a single-family residential development known as Canter Club Estates. As part of the development, J&J Kelly Construction extended City of Pasco watermain along N. Pearl Street from Road 64 to Road 67, including necessary valving, fittings, hydrants and other appurtenances. B) J&J Kelly provided the City with notice at the start of construction if it's intent to request a Latecomers Agreement and provided a construction cost estimate. At the conclusion of construction, J&J Kelly filed an application for Latecomers Agreement and supplied the required documentation to substantiate the request. C) During the construction of Canter Club Estates and the installation of the N. Pearl Street watermain extension, Mr. Leonid Parkhotyuk, owner of Parcel #18 591 043, requested that a watermain stub be extended to the north to facilitate the development of the parcel, which is located on the north side or and immediately adjacent to the N. Pearl Street right-of-way. That request was accommodated. V. DISCUSSION: A) City staff reviewed the actual construction cost documentation provided by J&J Kelly Construction, Inc. and determined it to be reasonable. The request for reimbursement is for 635 LF of 8 -inch watermain, valves, hydrants and appurtenances that fronts both parcels. The requested reimbursement amount included the costs for furnishing and installing materials, required construction inspection and testing, and appropriate permit fees. un B) Development of both parcels would require the watermain extension including connection to both existing watermains located along Roads 64 and 67, prior to development approval. Development of parcels, within the City of Pasco, are required to extend public infrastructure, including watermains, along the frontage of the parcel. Fronting parcels may seek reimbursement from other adjacent or benefitting landowners at the time of development of those parcels; i.e. Latecomers Agreement. C) In this circumstance, both parcels would be required to extend the watermain. The timing of which development preceded the other would make no difference in the responsibility of either parcel. Nor would the riming of either development preclude the property owner/developer from seeking a Latecomers Agreement for reimbursement of certain costs. D) Staff determined that Parcels #118 591 043 and 118 601 009 received direct benefit from the installation of and connection to the watermain extension. Considering that either parcel would be required to extend the watermain in order to create a subdivision of buildable single-family residential lots, and that neither subdivision of property could happen without the presence of a water source; it stands to reason that each parcel would gain the same benefit, regardless of how the parcels might be subdivided. Staff, therefore, determined that it is reasonable to assess fifty percent (50%) of the actual costs to each property owner. E) Staff recommends approval of the Latecomers Agreement and individual assessments. WHEN RECORDED RETURN TO: City of Pasco, Washington 525 North 3' Avenue Pasco, WA 99301 CITY OF PASCO LATECOMERS AGREEMENT THIS AGREEMENT, made and entered into this day of January 2015, by and between the City of Pasco, a Municipal Corporation of the State of Washington, hereinafter referred to as "City", and J & J Kelly Construction, Inc., their heirs, successors and assigns, hereinafter referred to as "Developers"; and WHEREAS, RCW Chapter 35.91 authorizes contracts between City and owner/developers of real estate within City, or within 10 miles of the City limits, who construct facilities to serve their own properties and other properties whereby such owner/developer may be reimbursed by the owners of other real property who did not contribute to the original cost of the construction of the facilities, but who later desire to connect their properties to the facilities previously constructed. NOW, THEREFORE, the parties hereby mutually agree as follows: Developers have constructed or will construct the following described improvement to City's facilities: 635 feet of 8 inch ductile iron waterline including fire hydrants, valves and other_ appurtenances on the new Pearl St_west of Road 64 A. The improvements have been or will be constructed in accordance with plans and specifications approved by City prior to construction and Developers have supplied City with reproducible as -built drawings regarding the facilities. B. Developers shall deed to City any and all easements pertaining to the facilities, said easements to be recorded concurrently with the final acceptance of this Agreement. 2. The facilities to be constructed will serve the following described real property: Parcel 118-591-043 and 118-601-009 (see Exhibit A) 3. If the facilities are certified as acceptable to City by the City Administrator or his designee, Developers will convey such facilities and the easements or lands wherein they lie to City for the monetary consideration provided herein Latecomers Agreement - 1 and the benefits of City services and of this Agreement. City will thereafter own and operate said facilities as part of City water/sewer system subject to all of the laws and regulations, fees and assessments of City. 4. City and Developers agree that the actual costs for the construction of the facilities is or will be Thirty nine thousand, six hundred eighteen dollars and seventy-eight cents ($39,618.78) and may be recovered for Developers in accordance with this Agreement. 5. Developers are the owners of the real property described above which will be served by the facilities described herein. 6. Unless the City provides written notice to the Developer of its intent to request a comprehensive plan approval, the Developer must request a comprehensive plan approval for utility system improvements, if required. 7. Connections of the sewer water facility to the municipal system must be further conditioned upon: a. Inspection and approval of the utility system improvements by the City; b. Full compliance with the Developers obligations under the Agreement and with the City's rules and regulations; c. Provision of sufficient security to the City to ensure completion of the utility system improvements and other performance under the Agreement; d. Payment by Developers to the City of all the City's costs associated with the utility system improvements including, but not limited to, engineering, legal, and administrative costs; e. Verification and approval of all Agreements and costs related to the utility system improvements; and f. Within one hundred and twenty (120) days of the completion of the utility system improvements, the Developers must submit the total cost of the utility system improvements to the City. 8. For a period of twenty (20) years from the date thereof, any person, firm or corporation now or hereafter owning real estate as described above, desiring to connect to the described facilities shall pay the cost of the construction of said facilities; i.e. $25.00 ;per each linear frontage foot of each parcel or portion of the real property above described that is connected to the City sewer services. 9. No person, firm or corporation shall be granted a permit or be authorized by City to tap into or use the referenced facilities during the period of time prescribed in Paragraph 6 above without first paying to City, in addition to any Latecomers Agreement - 2 and all other costs, assessments and charges made and assessed for such tap or use, the amount required by the provisions of this contract. All amounts so received by City shall be remitted to Developers or assigns within sixty (60) days of the receipt thereof. 10. Whenever any tap or connection is made into the described facilities, without such payment having first been made, the City may remove, or cause to be removed, such unauthorized tap or connection and all connecting tile or pipe located in the facilities right of way and dispose of unauthorized material so removed without any liability whatsoever. 11. Any funds collected by City in accordance with the terms of this contract shall be remitted Developers at the following address: Address: 1006 Christopher Lane, Pasco, WA 99301 Email: KeII)LWMily87&1nail.com Developers shall notify City in writing of any change in address. 12. If prior to the expiration of one (1) year after the date of execution of this Agreement or the completion of the construction of the facilities, whichever occurs later, any work is found to be defective, Developers shall promptly without cost to City, either correct such defective work or, if it has been rejected by City, remove and replace it with non -defective work. If Developers do not promptly comply with the terms of such instructions, City may have the defective work corrected or the rejected work removed and replaced and all direct and indirect costs of such removal and replacement, including compensation for professional services, shall be withheld from the latecomer's payment to Developers. 13. Developers agree that once Developers have been paid the total amount authorized for reimbursement as set forth in Paragraph 4 above, City shall collect no further fees under this contract and the provisions of this Latecomers Agreement for the collection of latecomer fees shall terminate. 14. Developers hereunder are an independent contractor and are not an agent or employee of City. 15. Developers agree to indemnify, defend and hold the City harmless from any action, claim or proceeding brought or maintained by any latecomer challenging the validity or enforceability of this Agreement. In turn, the City agrees to cooperate with the developer in the course of any such claim, proceeding or action to provide reasonable and lawful access to City records and witnesses. Latecomers Agreement - 3 CITY OF PASCO, WA David Zabell City Manager DEVELOPERS: Jeff Kelly Jennifer Kelly STATE OF WASHINGTON :as County of Franklin ) On this day personally appeared before me DAVE ZABELL, City Manager of the City of Pasco, to be known to be the individual described in and who executed the within and foregoing instrument, and acknowledged that he signed the same as his free and voluntary act and deed for the uses and purposes therein mentioned. GIVEN under my hand and official seal this day of , 20 . NOTARY PUBLIC in and for the State of Washington residing My Commission Expires: STATE OF WASHINGTON ) :ss County of Franklin ) On this day personally appeared before me Jeff and Jennifer Kelly, husband and wife, to be known to be the individuals described in and who executed the within and foregoing instrument, and acknowledged that they signed the same as their free and voluntary act and deed for the uses and purposes therein mentioned. GIVEN under my hand and official seal this day of 20_. NOTARY PUBLIC in and for the State of Washington residing My Commission Expires: Latecomers Agreement - 4 Memo To: Dave Zabell, City Manager Ahmad Qayoumi, PE, Public Works Director From: Michael A. Pawlak, PE, City Engineer Date: November 14, 2014 Public Works Department Engineering Division Re: Canter Club Estates — Latecomers Agreement Request Introduction. Jeff Kelly of J&J Kelly Construction, Inc., developer of Canter Club Estates, has applied for a Latecomers Agreement with regard to the new watermain installed along N. Pearl Street, west of Road 64. As part of the installation of public infrastructure to serve the new residential development (Canter Club Estates), J&J Kelly Construction installed 635 LF of 8 -inch Ductile Iron Water Pipe, including fire hydrants, valves and other appurtenances. The new watermain will also serve the adjacent undeveloped property along the N. Pearl Street right-of-way, upon its future development. The owner of that property, Leonid Parkhotyuk, negotiated with J&J Kelly Construction and the City at the time of the watermain installation, to have a stub watermain installed to the north for future connection. Cost and /Assessment Evaluation. Mr. Kelly submitted documentation quantifying the cost of construction of the line including pipe, fittings, hydrants, tap to the existing City watermain in Road 64, engineering plan review and construction inspection costs, and utility costs. That documentation has been reviewed by the Pasco Engineering Division and found to be reasonable and complete. Staff has also reviewed the proposed assessment area and is in agreement that the costs associated with the watermain installation should be shared equally (50/50) by each of the properties abutting N. Pearl Street along the length (635 LF) of pipe installation. The attached Exhibit A depicts both properties and the location of the new watermain. Upon development application either property would be required to extend City water along the N. Pearl Street alignment and connect to existing watermains at Road 64 and Road 67. Both property owners would also be eligible to make application for a Latecomers Agreement for partial reimbursement of eligible costs. Assessment of costs may be determined in a variety of methods; front footage, square footage, number of units, or zone and termini (PMC 14.12.040). Canter Club Estates ultimately developed a total of 27 lots. At the time of application and calculation of assessments, no proposals had been received for the property on the north side of the N. Pearl Street extension. In accordance with PMC 12.36.050, properties are required to extend utilities along the frontage of the parcels to be developed. The typical approach to assessing proportionate share of latecomer reimbursements 0 Page 1 along utility installations is the front footage method. A total estimated cost for the installation of the watermain is $39,618.78. Assessments to the two property owners would then equal: • Canter Club Estates (applicant) $19,809.39 • Leonid & Larisa Parkhotyuk (property located to the north of Pearl St) $19,809.39 Subsequent Development Application. Subsequent to the original application for developer reimbursement by J&J Kelly Construction, an application for development of the parcel on the north side of the N. Pearl Street alignment was received from Leonid Parkhotyuk. The application for Legacy Flats (Parkhotyuk) is for subdivision of the property into 4 lots fronting N. Pearl Street and 2 lots fronting on Road 64. The development application was received on September 11, 2014; two weeks after the August 29, 2014 preliminary assessment notification was sent to both property owners. Had Parkhotyuk applied for development of his parcel prior to the development of Canter Club Estates, he would have been required to extend the watermain from Road 64 to Road 67 and tie into both existing mains. He would have also been eligible to apply to the City Council for a Latecomers Agreement in order to receive some reimbursement from the adjoining property owner (Canter Club Estates) for a proportionate share of the watermain costs. That calculation would have been prepared suing the front footage method. To change the method of calculation at this time would not be fair and equitable, would place an additional burden on one property owner for the benefit of the other. Staff, therefore, recommends notification of the affected property owners and assessment of proportionate share of costs in accordance with PMC Chapter 14.12. Street and Utilities Assessment Reimbursement Agreements — Latecomers Agreements 0 Page 2 -.,s- Q� arty a?:,^'R _ �-,. . i w - � w$ AGENDA REPORT FOR: City Council 1j„- January 7, 2015 TO: Dave Zabell, City Managerr',s� Workshop Mtg.: 1/12/15 Regular Mtg.: 1/20/15 FROM: Rick Terway, Director, Administratiommunity Services SUBJECT: Gesa Stadium Upgrades I. REFERENCE(S): 1. Gesa Stadium Upgrades - Amendment # 2 2. Gesa Stadium Upgrades - Section 6.3 II. ACTION REQUESTED OF COUNCIL / STAFF RECOMMENDATIONS: 1/12: Discussion 1/20: MOTION: I move to approve the Amendment # 2 with the Tri -City Dust Devils, and authorize the City Manager to execute the agreement. III. FISCAL IMPACT: Neutral IV. HISTORY AND FACTS BRIEF: A) The City of Pasco and the Tri -City Dust Devils have created a strong partnership that has helped keep Professional Baseball in Pasco. The City of Pasco and the entire community have benefited from this partnership through economic development, civic pride and the improved quality of life that flows from a successful local professional sports team. The partnership began in 2004 and continues to flourish. V. DISCUSSION: A) Minor League Baseball has repeatedly notified the City of Pasco and the Dust Devils that the Home Clubhouse/Locker Room fails to meet professional baseball standards because it is roughly 500 square feet below the minimum size allowed. Since this is a structural improvement to the stadium, as per the City's lease agreement with the team, the responsibility for this change falls on the City. However, in the spirit of the partnership between the team and the City, the team has worked with an architect to identify a possible solution and is willing to work with the City in order to make this improvement a reality. B) The Dust Devils propose to help the City with this improvement similar to the way the team supported the City with the Office Building Improvement (Section 6.3 of our lease agreement). C) The Dust Devils will agree to pay for the clubhouse improvement project (up to $40,000) in exchange for an annual rent credit for the next 8 years, starting in 2015. The rent credit will be equal to 1/8th of the cost of the project, not to exceed $40,000. The details of the advance payment and rent credit would mirror the partnership language included in Section 6.3 of the current lease. In addition, the team will pay the cost of furnishing the new area and the cost of furnishing does not need to be reimbursed to the team by the City. D) Staff recommends approval of amendment #2- 4(h) SECOND AMENDMENT TO BASEBALL STADIUM LEASE THIS SECOND AMENDMENT TO BASEBALL STADIUM LEASE is made and entered into this day of January, 2015, by and between the City of Pasco, a Washington Municipal Corporation ("City"), and Northwest Baseball Ventures I, LLC, a Washington limited company (the "Tenant"). RECITALS: A. City and Tenant have executed that certain Baseball Stadium Lease Agreement dated January 14, 2008 (the "Lease"), which was subsequently amended by the First Amendment to Baseball Stadium Lease ("First Amendment") on the2nd day of June, 2008; and B. City and Tenant desire to modify certain terms of the Baseball Stadium Lease as provided below. NOW, THEREFORE, in consideration of the mutual covenants contained herein, it is agreed as follows; Rent. Section 4.1 entitled "Rent" shall be and hereby is amended and shall read as follows: 4.1 Rent. Tenant agrees to pay annual rent in the following amounts ("Rent"): Period Annual Rent From the Effective Date to 12/31/08 $25,000.00 1/1/09 to 12/31/09 $26,000.00 1/1/10 to 12/31/10 $27,000.00 1/l/11 to 12/31/11 $28,000.00 1/1/12 to 12/31/12 $29,000.00 1/1/13 to 12/31/13 $30,000.00 1/1/14 to 12/31/14 $31,000.00 1/1/15 to 12/31/15 $28,358.74 1/1/16 to 12/31/16 $29,244.95 1/1/17 to 12/31/17 $30,131.16 Rent shall be paid to City at 525 North 3rd Avenue, Pasco, Washington 99301, Attention: City Treasurer ("City's Address"). Tenant shall pay Rent in a lump sum annually on June 15 of each calendar year during the Tenn. Tenant shall pay a late service charge on all past due rent at the rate of five percent (5%) per month, but in no event higher than the legit limit. In addition to the Rent specified in Section 4. 1, from and after January 1, 2015, the Tenant shall pay leasehold excise tax in accordance with Chapter 82.29A RCW (the "Leasehold Tax") for the remainder of the terms in the following amounts: Second Amendment to Baseball Stadium Lease - 1 Period Tax 1/1/15 to 12/31/15 $3,641.26 1/1/16 to 12/31/16 $3,755.05 1/1/17 to 12/31/17 $3,868.84 If City raises the admission tax on tickets to view events in the Baseball Stadium above two and one-half percent (2.5%), the Rent set forth above shall be reduced on a dollar for dollar basis for each year the dollar amount of admission taxes collected by Tenant has already paid Rent, City shall refund to Tenant a portion of the Rent overpaid as a result of the application of this provision. 2. Improvements. That Section 6.3 entitled "Improvements" shall be and hereby is amended by the addition of the following: 6.3 Improvements. f. In addition to the Improvements as provided in Section 6.3.a above, the City shall allow Tenant to make and install Improvements to the clubhouse facility having an approximate value of $40,000. Tenant shall use good faith and diligent efforts to complete the construction of the Improvements and for the Improvements to be ready for occupancy no later than June 1, 2015. The Improvements shall be constructed and installed according to all governing laws and regulations, including but not limited to, the Americans with Disabilities Act. Prior to constructing or installing the Improvements, Tenant shall submit to City plans and specifications for the Improvements for City approval, such approval not to be unreasonably withheld. The location of the Improvements shall be subject to the prior approval of City. During the term of the Lease, Tenant shall maintain ownership of the Improvements; however, at the expiration of the Term, City may (i) require Tenant to remove the Improvements or (ii) allow Tenant to abandon the Improvements, at which time, the Improvements shall become part of the Property and be owned by City. g. In addition to the Improvements as provided in Section 6.3.b above, Tenant shall provide City with an accounting of the actual third -party costs and expenses incurred by Tenant to install the Improvements to the clubhouse facility, including paint, carpet/flooring and any built-in cabinets and counters, such costs not to include fees to Tenant or affiliates of Tenant, furniture or fixture costs, or other non -third party expenses. If requested by the City, the accounting shall be accompanied by receipts, contracts, or any other reasonable evidence of the costs incurred by Tenant for the Improvements. Upon City review and approval of such accounting, the costs incurred by Tenant to install the Improvements shall constitute the Approved Costs. h. In addition to the Improvements as provided in Section 6.3.c above, City shall provide Tenant with an annual credit for the against the Rent in an amount equal to one- eighth (1/8th) of the Approved Costs for the clubhouse facility, such credit shall not exceed $5,000 annually, or $40,000 in the aggregate (the "Rent Credit"). Second Amendment to Baseball Stadium Lease - 2 i. If City and Tenant mutually agree upon the Rent during the Extension Term and extend this Lease through the Extension Term for the clubhouse facility, then Tenant shall be eligible for the Rent Credit through the Extension Term in accordance with the rate provided in subsection h above. If Tenant terminates this Lease after the expiration of the Initial Term without exercising its option to extend the lease, then Tenant shall have forfeited any remaining Rent Credit. j. If Tenant exercises its option to extend this Lease for the clubhouse facility, but City and Tenant have not mutually agreed on the Rent for the Extension Term at least twelve (12) months prior to the last day of the Initial Term, then (i) upon expiration of this Lease following the end of the Initial Term and provided that Tenant has otherwise complied with the terms of this Lease, Tenant shall receive one-third (1/3) of the Rent Credit as a termination fee within sixty (60) days following the last day of the Initial Term; and (ii) this Lease shall terminate upon the expiration of the Initial Term. Notwithstanding the preceding sentence, if City proposes an amount for annual Rent for the Extension Term which does not exceed $34,000, and Tenant does not accept this proposal, then Tenant shall have forfeited any right to a termination fee upon the expiration of this Lease. 3. Remaining Terms and Conditions. All remaining terms and conditions of the Baseball Stadium Lease as amended by the First Amendment to Baseball Stadium Lease not inconsistent with the Amendments provided by this Agreement, shall remain in full force and effect. If there are any conflicts between the terms and provisions of the Lease, the First Amendment, and this Second Amendment, the terms of the Second Amendment shall control. 4. Counterparts. This Second Amendment may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Lease or any counterpart may be executed and delivered by facsimile transmission with an executed hard copy to follow. 5. Definitions. All terms and definitions used in this Second Amendment hot herein defined are to be give the definition of the term as provided in the Lease, unless specifically stated otherwise. 6. Authorization. Each party represents and warrants to the other that it fully empowered and authorized to execute and deliver this Second Amendment, and the individual signing this Second Amendment on behalf of such party represents and warrants to the other party that he or she is fully empowered and authorized to do so. IN WITNESS WHEREOF, City and Tenant have executed this Second Amendment the day and year first above written. Second Amendment to Baseball Stadium Lease - 3 CITY: City of Pasco, a Washington Municipal Corporation M Dave Zabell, City Manager TENANT: Northwest Baseball Ventures I, LLC, a Washington Limited Liability Company LO Title: Second Amendment to Baseball Stadium Lease - 4 e. If the Additional Rent is included in contract rent for purposes of calculating the Leasehold Tax, City shall pay such Leasehold Tax, including all applicable penalties and interest thereon, from the Additional Rent remitted by Tenant and the Additional Rent shall be deemed to have been reduced by the amount of such Leasehold Tax. f. Tenant shall include in all written agreements with third parties that sponsor Other Events, the right of City to audit such third parties' records regarding payment of sublease/license fees. V. UTILITIES 5.1 Utilities a. Utility Charges. Tenant shall pay or cause to be paid when due, and shall indemnify, protect and hold harmless City and the Premises from all charges for public or private utility services to the Premises during the Term, including without limiting the generality of the foregoing, all charges for heat, light, electricity, potable water, gas, telephone service, garbage collection and sewer and drainage service. Notwithstanding the foregoing, the City shall provide un -metered well irrigation water to Tenant at no cost to Tenant. b. Interruptions of Utility Services. City shall not be liable to Tenant in damages or otherwise (i) if any utility shall become unavailable from any entity (including City) supplying or distributing such utility, or (ii) for any interruption in any utility service (including, without limitation, any heating, air-conditioning or sprinkler) caused by the making of any necessary repairs or improvements or by any cause, and the same shall not constitute a termination of this Lease or an eviction of Tenant. If any utility service, used at the Premises and for which City is responsible, shall be interrupted, City shall restore such utility service as soon as practical. VI. CONDITION OF PREMISES; IMPROVEMENTS 6.1 Current Condition. Tenant agrees to accept the Premises and Baseball Stadium in its current "as is, where is" condition. Tenant acknowledges the opportunity prior to its execution of this Lease to conduct a thorough inspection of the Premises. 6.2 Air Conditioning. The air conditioning, previously installed by Tenant in the "home team" clubhouse/locker room, is part of the Premises, and during the Term shall be maintained by Tenant at Tenant's cost. Upon expiration or earlier termination of this Lease, the air conditioning equipment shall become the property of City, without additional cost or expense to City. 6.3 Improvements. Tenant has requested City's permission to install certain fixtures on the Premises during the Lease Term. City consents to Tenant's request pursuant to the requirements and conditions contained in this Section 6.3. El a. City shall allow Tenant to install a modular office building on the Property containing approximately square feet (the "Improvements"). Tenant shall use good faith and diligent efforts to complete the construction of the Improvements and for the Improvements to be ready for occupancy no later than June 15, 2008. The Improvements shall be constructed and installed according to all governing laws and regulations, including but not limited to, the Americans with Disabilities Act. Prior to constructing or installing the Improvements, Tenant shall submit to City plans and specifications for the Improvements for City approval, such approval not to be unreasonably withheld. The location of the Improvements shall be subject to the prior approval of City. During the Term of the Lease, Tenant shall maintain ownership of the Improvements; however, at the expiration of the Term, City may (i) require Tenant to remove the Improvements or (ii) allow Tenant to abandon the Improvements, at which time, the Improvements shall become part of the Property and be owned by City. b. Following completion of the Improvements, Tenant shall provide City with an accounting of the actual third -party costs and expenses incurred by Tenant to install the Improvements, including paint, carpet/flooring and any built-in cabinets and counters, such costs not to include fees to Tenant or affiliates of Tenant, furniture or fixture costs, or other non -third party expenses. If requested by the City, the accounting shall be accompanied by receipts, contracts, or any other reasonable evidence of the costs incurred by Tenant for the Improvements. Upon City review and approval of such accounting, the costs incurred by Tenant to install the Improvements shall constitute the Approved Costs. C. City shall provide Tenant with an annual credit against the Rent in an amount equal to one -fifteenth (1/15s') of the Approved Costs, such credit not to exceed $11,666 annually or $175,000 in the aggregate (the "Rent Credit'). d. If City and Tenant mutually agree upon the Rent during the Extension Term and extend this Lease through the Extension Term, then Tenant shall be eligible for the Rent Credit through the Extension Term. If Tenant terminates this Lease after the expiration of the Initial Term without exercising its option to extend the Lease, then Tenant shall have forfeited any remaining Rent Credit. e. If Tenant exercises its option to extend this Lease but City and Tenant have not mutually agreed on the Rent for the Extension Term at least twelve (12) months prior to the last day of the Initial Term, then (i) upon expiration of this Lease following the end of the Initial Term and provided that Tenant has otherwise complied with the terms of this Lease, Tenant shall receive one-third (1/3) of the Rent Credit as a termination fee within sixty (60) days following the last day of the Initial Term; and (ii) this Lease shall terminate upon the expiration of the Initial Term. Notwithstanding the preceding sentence, if City proposes an amount for annual Rent for the Extension Term which does not exceed $34,000, and Tenant does not accept this proposal, then Tenant shall have forfeited any right to a termination fee upon the expiration of this Lease. VII. REPAIRS AND MAINTENANCE 7.1 City Obli ation. City shall, at its own cost and expense, maintain and repair all structural portions of the Premises in a good and safe condition during the Term, reasonable wear and tear excepted, promptly after City is made aware of the need for such structural maintenance and/or repair. Structural portions of the Premises shall include, without limitation, all sidewalks IFA