SR-900-003-01
City Council Meeting: June 28, 2005 Santa Monica, California
TO: Mayor and City Council
FROM: City Staff
SUBJECT: Recommendation to Authorize the City Manager to Negotiate and
Execute a Modification to the Windward School Lease
Introduction
This report recommends that the City Council authorize the City Manager to
negotiate and execute the Fourth Amendment to the Windward School Lease.
Background
Since 1983 the City of Santa Monica has leased to Windward School a portion of
City property located at Sawtelle Boulevard and Palms Boulevard in West Los
Angeles. The property is the Charnock well field, comprising approximately 7.5
acres south of the flood control channel at the location. Under the terms of the
original lease, Windward was authorized to use the property for recreational
purposes, principally as outdoor play fields and as basketball courts. Windward
was also allowed to build a structure to be used as classroom facilities. The initial
duration of the lease was July 1, 1983 to June 30, 1998 (15 years).
Under a successor lease dated June 1, 1990, Windward was authorized to
construct a gymnasium facility. Also under the 1990 lease, the gymnasium, play
fields, and outdoor courts were considered ?Shared Use Facilities? which allows
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the City the right to use the facilities for City recreational programs. The 1990
revision extended the termination date to June 30, 2020.
In July 1994, the City and Windward executed a First Amendment to the 1990
lease. Under this amendment Windward was authorized to build the following
additional improvements: (1) two buildings to be used as classroom,
administrative, or other related uses; (2) men?s and women?s restrooms; (3)
student pavilion, dining area, kitchen, classrooms, administrative offices, or other
related uses; (4) girls and boys locker room facilities; (5) pedestrian bridge over
the L.A. County flood control channel; (6) a paved parking lot; (7) a covered
student waiting area; and (8) an electrical power room. Windward agreed to pay
an increased lease amount to the City for authorization to construct the additional
improvements and the lease term was extended to June 30, 2024.
In August of 1996, the City and Windward executed a second amendment to the
1990 lease. Under this amendment, Windward was granted a revision allowing it
to site improvements anywhere within existing improvement areas already
approved by the City. The primary reasons for the second amendment were to
address unforeseen conditions and elimination of a potential conflict with existing
City water production facilities. For example, unforeseen rocky soil conditions
had prevented Windward from proceeding with construction in a previously
approved area, and a previously approved development area was determined by
the City to be too close to an existing water well. This amendment provided more
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flexibility to the City in approving the siting of Windward improvements in order to
prevent conflicts with existing or future City facilities. There was no increase in
the total size of the allowable building area, and no change in the monthly lease
payments. The lease termination date remained June 30, 2024.
In July 1999, a third amendment to the Windward Lease was approved,
addressing the school?s newly developed master plan proposing construction of
additional educational and administrative facilities. The master plan proposed
modified existing building areas and recreational facilities on the portion of land
leased from the City. The third amendment included a reconfiguration of
allowable building zones such that the total area for allowable building was
unchanged. Windward-funded improvements/modifications included construction
of campus-dedicated electrical and water service to serve the portion of the
campus south of the flood control channel (previously this service was provided
and billed to the school by the City, which maintained water and electrical service
for its property south of the channel), relocation of the City?s Metropolitan Water
District (MWD) 24-inch diameter feeder line and appurtenances (vault and control
valves) necessary to avoid conflicts with planned and approved construction, and
necessary fence, wall and surface improvements. There was no change to the
payment terms. The lease termination date remained June 30, 2024.
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Discussion
Representatives of Windward and City staff have met in recent months to discuss
Windward?s proposal to modify the existing lease terms in a manner beneficial to
both parties. Windward desires to more efficiently utilize their existing leasehold
and make use of additional land to create a new surface parking area, remove
the overlap of existing play fields, connect the building zones between the
existing gymnasium and the outdoor basketball courts, and extend the lease
term. In considering this proposal, City staff?s principal objective is to ensure the
safe and efficient operation of the City?s water facilities. Nothing in the proposed
lease modifications will have an adverse effect upon the current or future use of
the Charnock site for the City?s water operations. Accordingly, proposed terms
for a fourth amendment to the 1990 lease meet Windward?s long term objectives,
and provide the City with added value in terms of facility and security upgrades,
community access to recreation facilities as well as increases in the lease
payments over the term of the agreement.
Specifically, the proposed fourth amendment includes the following provisions:
Windward may utilize additional land areas for additional parking area and
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to eliminate overlap of playing fields and may connect the building zones
between the existing gym and the existing outdoor basketball courts.
Should the playing field modification require relocation of any existing
water wells, the existing wells will be closed and reconstructed by the City
at another location on the property at Windward?s expense. Total
additional land area for playfield modifications and parking area is 22,935
square feet.
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Extend the lease termination date to June 30, 2055. This is an extension
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of thirty one (31) years from the current termination date.
Upgrades in the level of security provided by Windward for the property
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they will be leasing adjacent to the City?s water facilities. This enhanced
security will complement the City?s security measures for the water wells
and facilities:
Windward to install closed circuit cameras to monitor the entire
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perimeter of their campus, as well as the City?s perimeter fences,
including tape recording capabilities (no closed circuit requirement
in the current lease)
Two guards on duty during school hours (one in current lease)
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One guard on duty Saturday and Sunday (none in current lease)
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One guard on duty during holidays (none in current lease)
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Additional guards engaged during special events (no additional
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guards during the school year in the current lease)
Drive by and walk through surveillance on the premises every 60
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minutes (90 minutes in current security services)
Windward will maintain fencing around entire area of campus (no
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requirement in the current lease to maintain fencing)
Windward School will provide increased specificity regarding the
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availability of its current recreational facilities for use by the City to support
its ongoing organized recreational programs and those of Santa Monica
sports organizations receiving permits through the City:
Annually, Windward will submit to the City a calendar indicating
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blocks of time that will be available for use by the City to meet the
community access provisions of the Lease.
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The annual calendar will include, at a minimum, an average of nine
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hours per week for use of the currently existing play field,
calculated on an annual basis .
Windward will provide timely information to all public and private
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schools located in Santa Monica through direct mailings to the
schools and through press releases to the local media regarding all
school-year or summer recreational/educational programs offered
or sponsored by Windward that are offered to non-Windward
students, including sports training and enrichment programs.
Upon construction of new recreational facilities specified in Windwards
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current Master Plan (a planned second gymnasium and new Aquatics
Center), Windward will increase its total minimum community access
hours by 50%, including, at a minimum, an average of five hours per
week of Aquatics Center use, calculated on an annual basis.
All other non-financial terms and conditions of the existing lease remain
unchanged. In particular, the ability of the City to operate its facilities at the site
for water production and treatment is not diminished. Conditions for the Shared
Use Facilities remain in force, continuing the City?s right to use these facilities for
recreational programs. This joint-use arrangement between the City and
Windward is working satisfactorily. It should also be noted that the entire site is
currently zoned as open space by the City of Los Angeles, but Windward is able
to continue operating on the site as an approved non-conforming use.
Alternative uses by the City of the areas used by Windward for non-water
production purposes would therefore be very limited.
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Budget/Financial Impact
Included in the proposed fourth amendment are increases in the lease payments
to be made by Windward to the Water Fund, in consideration of the use of
additional land area and extending the lease termination date. Presently,
Windward pays $119,306 annually for 281,933 square feet, equivalent to $0.423
per square foot. Under the proposed fourth amendment, Windward would add
22,935 square feet of useable area at the same price per square foot, or $9,702
annually.
The rent would increase on January 1, 2006 by 7.5% and again in January 1,
2007 by 7.5%. On a fiscal year basis, total FY 2005-06 revenue will be $133,846
or $14,540 more than what would have been paid during FY 2005-06 under the
existing lease terms. For FY 2006/07, the total annual lease revenue will be
$143,885.
Subsequent annual rent increases will continue per the existing CPI
arrangements (an annual CPI increase based on a standard CPI index), with
terms added to address conditions for re-opening the lease to review lease
payments that may provide further financial benefit to the Water Fund.
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Recommendation
Staff recommends that the City Council authorize the City Manager to negotiate
and execute the Fourth Amendment to the Windward School Lease as described
herein.
Prepared by: Craig Perkins, Director, Environmental and Public Works Management
Gil Borboa, P.E., Water Resources Manager
Jeff Mathieu, Director, Resource Management
Steve Stark, Director, Finance
(Reference Modification to Contract No. 5457 (CCS).)
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