SR-301-001-01 (7)
DEe IJ4~
Council Meeting: December 14, 2004
Santa Monica, CA
TO: Mayor and Councilmembers
FROM: City Staff
SUBJECT: Authorize City Manager to Execute Agreements with the Santa Monica
Unified School District for Community Use
Introduction
At the City Council meeting of May 11, 2004 the Council agreed to terms for a new
community use agreement with the Santa Monica Malibu Unified School District. Sub-
agreements define the practical understanding between the parties for specific
programs on school sites. This report seeks authorization for the City Manager to
execute the documents that formalize these agreements.
Backqround and Discussion
Over the course of several months in 2003 and 2004, City and District staff negotiated a
multi-year Master Agreement under which the City will provide financial consideration
($6M annually initially) for use of District property for public programs. The School
Board and City Council approved the terms that spring (see attachment). Individual
programs at school sites are governed by sub-agreements to the Master agreement and
have been in preparation over the ensuing months. Resulting documents will be ready
for execution in the coming weeks. Formal direction to the City Manager to execute the
documents is required.
DEe 1 4 2004
1
J~
. t:
Budqet/Financial Impact
Funds for the purpose of payments required under the Master Agreement are available
at account 01274.566820. The Community and Cultural Services budget makes
provision for the cost of individual programs at school sites.
Recommendation
Staff recommends that the City Council direct the City Manager to execute the Master
Agreement and sub agreements with the Santa Monica Unified School District that
provide for community use of District property.
Prepared by: Susan E. McCarthy, City Manager
Attachment: May 11, 2004 Staff Report
2
'~
Council Meeting: May 11, 2004
Santa Monica, CA
TO: Mayor and City Council
FROM: City Staff
SUBJECT: Request for Direction to Staff Regarding Proposed Terms For A New
Contract Providing Payments to the Santa Monica-Malibu Unified School
District in Exchange for Community Access to School Facilities
Introduction
This report conveys proposed terms developed in discussions between the
Superintendent of Schools and the City Manager regarding a new contract providing
payments to the Santa Monica-Malibu Unified School District (District) in exchange for
community access to school facilities and requests Council direction regarding
finalization of the terms.
Backqround
The City and District currently have a contract under which the City provides payments
to the District in exchange for community use of school facilities when they are not
required for District use. The pattern in recent years has been to have single-year
contracts to memorialize this exchange of value. In December of 2003 and again in
January of 2004, the City Council directed the City Manager to engage in discussions
that could lead to a new, longer-term contract with the District and enhance the
exchange of value over the term. The City Manager and Superintendent have had
several discussions to that end and have developed a working draft of proposed terms
for a contract. The working draft is attached to this report.
1
Discussion
The proposed terms provide for potential increase in the exchange of value over the
term, recognize that the fiscal status of the two organizations may affect the exchange
of value, and provide flexibility to respond to changing conditions while providing a level
of predictability for the parties in regard to the intent and expectations associated with
the contract.
Budqet Financial Impact
The proposed City fiscal year 2004/05 General Fund budget and the plan for fiscal year
2005/06 that Council will consider in study sessions beginning May 25, will include the
proposed base payments to the District of $6 Million and the anticipated second year
growth by a cost of living factor. Based on currently available information and proposed
City service levels, staff projects that revenue will accommodate the new payment
levels. Due to the considerable uncertainty surrounding State funding for local
government over the next several years and the likelihood that Council may wish to
restore at least some of the service level reductions made over the past several years to
balance the City budget, new or enhanced revenue streams will likely be required and
Council will be asked to consider placing such a measure on the November 2004 ballot.
Recommendation
Staff recommends that the City Council consider the working draft of proposed terms
attached and provide direction to staff regarding preparation of a contract.
Prepared by: Susan E. McCarthy, City Manager
Attachment: Proposed Term Sheet
2
PROPOSED TERM SHEET: WORKING DOCUMENT PREPARED 5/5/2004
(1 :40 p,m.)
CONDITIONS OF RELEASE: THIS DOCUMENT REPRESENTS THE JOINT WORK
OF THE CITY MANAGER AND SUPERINTENDENT TO DATE AND IS PRESENTED
FOR THE CONSIDERATION OF THE CITY COUNCIL AND BOARD OF EDUCATION.
IT IS EXPRESSLY NOTED THAT THIS PROPOSED TERM SHEET HAS NOT BEEN
REVIEWED BY LEGAL COUNSEL AND FURTHER CLARIFICATION AND
DEFINITION MAY BE NECESSARY.
INTENT AND EXPECTATIONS OF THE PARTIES
1,) Intent of parties is to maximize the exchange of value - community use of school
facilities and revenue flow to district. It is recognized by both parties that new and
onf;loing resources are desired and necessary to fully support the strategic plan(s) and
the community's expectations of both organizations. The parties understand that if any
initiative is approved by the voters that would adjust or amend the City Charter for the
purposes of funding educational programs, the contract is no longer binding.
TERM(S)
2.) Initial five Year term beginning July 1, 2004 and ending June 30, 2009 with two
2.5 year options to extend by mutual agreement.
BASE PAYMENTS
3,) Effective July 1,2004 annual base payments will total $6,000,000.00.
3
ANNUAL ADJUSTMENT TO BASE
4.) Annual Base Payments will be adjusted by the Consumer Price Index for all
urban wage earners and clerical workers for LNLB SMSA (CPI), as measured from
February to February with a minimum 2% and a maximum 4% adjustment.
OTHER ADJUSTMENTS TO BASE
Conference and Participation
5.) In January 2007 the parties will convene an adjustment conference to assess the
state of community use of school facilities and the fiscal status of the two organizations
with the objective of adjusting the current payments for the use of said facilities upward
or downward by a maximum of $1 ,000,000.00, or holding payments constant for
2007/2008. The adjustment conference participants (conferees) will consist of the
following persons: the City Manager, the Superintendent of Schools, the Finance
officers of both the City and School District, the Mayor, and the School Board President.
The, conferees will participate in the adjustment conference with the objective to have
recommendations before the City Council and School Board by March 1, 2007.
Revenue Sources
6.) In assessing the fiscal status of the City in order to establish the payments for
the use of school facilities, the total of the following "Big Eight" General Fund revenue
sources will be used: 1) property tax, 2) sales tax, 3) utility users tax, 4) transient
occupancy tax (TOT), 5) business licenses tax, 6) real property transfer tax, 7) parking
facilities tax, and 8) fines/forfeitures.
4
Trigger
7.) If the cumulative growth of the actual "Big Eight" revenues (see section 6.
Revenue Sources) over the two-year period 2004/2005 and 200520/06 exceeds the
increase of CPI by 4% and the increase in each of those years exceeds the CPI by at
least 1.25%, the conferees will discuss adjusting the base payments by an additional
3/4 of 1 % of the average of the actual "Big Eight" revenues for 2004/2005 and
2005/2006 by a maximum of $1,000,000.00 effective 2007/2008. While the result of the
discussions can not be pre-determined, the conferees will be mindful of the intent of this
contract in approaching the discussion.
8.) If the actual cumulative growth of the revenue sources found in the "Big Eight"
exceeds CPI but does not reach the level specified in #7, above, the conferees will
discuss whether to recommend if there should be any adjustment to base payments
above that specified in #4, above. While the result of the discussions can not be pre-
determined, the conferees will be mindful of the intent of this contract in approaching the
discussion.
9.) If the actual cumulative growth of the revenue sources found in the "Big Eight"
does not increase by at least CPI in 2004/2005 and 2005/2006, the conferees will
discuss whether: 1) base payments should be held constant, 2) the CPI contemplated in
#4, above, withheld, or 3) base payments reduced by some amount which in no case
would exceed $1,000,000.00. While the result of the discussions can not be pre-
5
determined, the conferees at the conference will be mindful of the intent of this contract
in approaching the discussion.
CONTRACT EXTENSION and ADDITIONAL ADJUSTMENT
10.) In January 2009, the adjustment conference described above will be convened to
assess the state of community use of school facilities and the fiscal status of the two
organizations and discuss whether the contract should be extended for an additional 2.5
years, using the formula described in 7 and 8, above to set the 2009/2010 base
payments, except that the $1,000,000.00 maximum will be adjusted for the change in
CPI since the 2007/2008 adjustment, providing a new maximum cap. Should the
second contract extension option be exercised, the same process would be followed to
set the 2012/2013 base.
EXTRAORDINARY CONDITIONS
11 .) If in each of any two consecutive fiscal years over the term of the contract the
actual growth of the total "big eight" revenues exceeds 7,5%, the conferees will meet in
January to discuss adjusting payments above the then applicable cap effective July 1 of
the same calendar year.
12.) If in each of any two consecutive fiscal years over the term of the contract the
actual revenue from the total "big eight" declines by 7.5%, the City may convene the
conference to discuss temporarily suspending the contract.
6