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HomeMy WebLinkAbout2022-08-31 CVBFFA Agenda PacketSan Diego Unified Port District  3165 Pacific Hwy. San Diego, CA 92101  Meeting Agenda  Chula Vista Bayfront Facilities Financing Authority    Wednesday, August 31, 2022  3:00 PM    Don L. Nay Port Administration Boardroom     ****Pursuant to Assembly Bill 361 and state or local officials’ continued recommend measures to  promote social distancing in response to the COVID‐19 pandemic, the CHULA VISTA BAYFRONT  FACILITIES FINANCING AUTHORITY (AUTHORITY) hereby provides notice that it will hold a regular  meeting of the BOARD OF DIRECTORS OF THE AUTHORITY (BOARD). Some of the Directors may attend  the meeting and participate remotely to the same extent as if they were present.    The public is welcome to attend in person, or alternatively.    MEMBERS OF THE PUBLIC MAY JOIN THIS MEETING VIA TEAMS at:    Join on your computer or mobile app Click here to join the meeting Meeting ID: 226 942 974 992 Passcode: ioxXZF Download Teams | Join on the web Or call in (audio only) +1 619-535-7686,,267326495# United States, San Diego Phone Conference ID: 267 326 495#   PROVIDING PUBLIC COMMENT  Public comment is limited to 2 minutes per speaker on both agenda, and non‐agenda items.  The time  allotted for speakers may be adjusted by the Board Chair at his or her discretion.    PUBLIC COMMENT IS AVAILABLE FOR THIS MEETING BY DOING ONE OF THE FOLLOWING NO LATER  THAN THE TIME THE PUBLIC COMMENT PORTION FOR THE AGENDA ITEMS IS CONCLUDED, HOWEVER  THE PUBLIC IS STRONGLY ENCOURAGED TO DO SO PRIOR TO THE ITEM BEING CALLED:    In‐Person Participation: Complete and submit a Speaker Slip and give to the District Clerk.     Remote Participation:    1. Call 619‐736‐2155 and leave a brief voicemail message that will be played during the meeting.  A  voicemail longer than the time allotted for public comment on that item will be stopped after that time  has elapsed.  2. Email a request to provide live comments to PublicRecords@portofsandiego.org to receive a link  to participate in the meeting to provide live comments. *  3. Submit written comments to PublicRecords@portofsandiego.org which will be forwarded to the  Board and included in the agenda‐related materials record for the meeting.     * Neither the San Diego Unified Port District nor the Authority are responsible for the member of the  public’s internet connections or technical ability to participate in the meeting. It is highly recommended  that you use voicemail rather than provide live comment.    In keeping with the Americans with Disabilities Act (ADA), the Authority and San Diego Unified Port  District will make every reasonable effort to encourage participation in all its public meetings. If you  require assistance or auxiliary aids in order to participate at this public meeting, please contact the  Office of the District Clerk at publicrecords@portofsandiego .org or (619) 686‐6206 at least 48 hours  prior to the meeting.    Board of Directors  Honorable City of Chula Vista Mayor Mary Casillas Salas City of Chula Vista Councilman Stephen Padilla  Port Commissioner Ann Moore Port Commissioner Rafael Castellanos  Port Commissioner Dan Malcolm      A. Call to Order    B. Roll Call    C. Non‐Agenda Public Comment    Each individual speaker is limited to two (2) minutes    D. Consent Items    RESOLUTION:    (1) MAKING FINDINGS REGARDING VIRTUAL MEETINGS OF THE BOARD IN ACCORDANCE WITH THE  RALPH M. BROWN ACT AND CALIFORNIA ASSEMBLY BILL 361;     (2) AUTHORIZING THE CO‐COUNSELS OF THE AUTHORITY TO EXECUTE AND DELIVER A SECOND  AMENDMENT TO THE LEGAL SERVICES AGREEMENT WITH STRADLING YOCCA CARLSON & RAUTH  (STRADLING) FOR BOND COUNSEL AND DISCLOSURE COUNSEL SERVICES (STRADLING CONTRACT) FOR A  NOT‐TO‐EXCEED AMOUNT OF $1.69 MILLION AND TO AMEND THE STRADLING CONTRACT TO PERMIT  CO‐COUNSEL TO ENGAGE STRADLING FOR ADDITIONAL SPECIAL SERVICES; AND    (3) AUTHORIZING CHANGES TO THE FREQUENCY OF THE REGULAR MEETINGS OF THE BOARD TO  ONCE A MONTH ON THE THIRD WEDNESDAY OF EACH MONTH, BEGINNING SEPTEMBER 1, 2022, AND  TO ESTABLISH THE LOCATION OF THE REGULAR MEETINGS.    E. Action Items    None.    F. Staff Comments    G. Board Comment    H. Adjournment  DATE: August 25, 2022 SUBJECT: RESOLUTION: A. AUTHORIZING THE CO-COUNSELS OF THE CHULA VISTA BAYFRONT FACILITIES FINANCING AUTHORITY (AUTHORITY) TO EXECUTE AND DELIVER A SECOND AMENDMENT TO THE LEGAL SERVICES AGREEMENT WITH STRADLING YOCCA CARLSON & RAUTH (STRADLING) FOR BOND COUNSEL AND DISCLOSURE COUNSEL SERVICES (STRADLING CONTRACT) FOR A NOT- TO-EXCEED AMOUNT OF $1.69 MILLION AND TO AMEND THE STRADLING CONTRACT TO PERMIT CO-COUNSEL TO ENGAGE STRADLING FOR ADDITIONAL SPECIAL SERVICES B. AUTHORIZING CHANGES TO THE FREQUENCY OF THE REGULAR MEETINGS OF THE BOARD OF DIRECTORS OF THE AUTHORITY (AUTHORITY BOARD) TO ONCE A MONTH ON THE THIRD WEDNESDAY OF EACH MONTH, BEGINNING SEPTEMBER 1, 2022, AND TO ESTABLISH THE LOCATION OF THE REGULAR MEETINGS C. MAKING FINDINGS REGARDING VIRTUAL MEETINGS OF THE AUTHORITY BOARD IN ACCORDANCE WITH THE RALPH M. BROWN ACT AND CALIFORNIA ASSEMBLY BILL 361 EXECUTIVE SUMMARY: The Chula Vista Bayfront Facilities Financing Authority (Authority) was formed through that certain Joint Exercise of Powers Agreement between the City of Chula Vista (City) and the San Diego Unified Port District (District) dated as of May 1, 2014 and filed in the Office of the District Clerk as Document No. 61905 (Original Authority Agreement), as amended and restated by that certain Amended and Restated Joint Exercise of Powers Agreement between the City and District dated July 25, 2019 and filed in the Office of the District Clerk as Document No. 70245 (A&R Authority Agreement), and as further amended by that certain Amendment No. 1 to the Amended and Restated Joint Exercise of Powers Agreement dated August 10, 2022 (Amendment No. 1, together with the A&R Authority Agreement, the Authority Agreement). The District and the City (each, a Member of the Authority) are the sole members of the Authority. The District and the City have been working collaboratively for decades to plan and implement the Chula Vista Bayfront Master Plan (CVBMP). Since 2014, the District and the City have been working to deliver the catalyst project for the CVBMP, an approximately 275,000 net usable square foot convention center (Convention Center) and a 1,570 to 1,600 room resort hotel (Resort Hotel) to be located on Parcel H3 of the CVBMP. The project also requires the construction of extensive public infrastructure to Page 2 of 8 the areas surrounding Parcel H3 (Phase 1A Infrastructure Improvements). On May 26, 2022, the Authority issued tax and tax-exempt bonds (collectively, Authority Bonds) to finance the public contribution for the construction of the Convention Center and Phase 1A Infrastructure Improvements. Since the issuance of the Authority Bonds, the District and the City can now move into the next phase, which requires Authority staff to implement the various requirements of the Authority Bonds and regulate the construction and implementation of the Phase 1A Infrastructure Improvements and Convention Center. Second Amendment to Stradling Contract The Authority and Stradling, Yocca, Carlson & Rauth (Stradling) entered into a Bond Counsel and Disclosure Counsel Agreement (Original Agreement) on April 1, 2020. The Original Agreement provided for a not-to-exceed legal services fee amount of $450,000. The not-to-exceed amount was amended on October 6, 2021 to $1.5 million through the approval by the Board of Directors of the Authority (Authority Board) of a First Amendment to the Original Agreement. The First Amendment, together with the Original Agreement, are hereinafter referred to as, the “Agreement”. Subsequent to the Authority’s approval of the First Amendment, changes in the public finance market occurred requiring additional modifications to the transaction, and substantial additional, unforeseen legal work by Stradling in order to restructure certain elements of the deal, renegotiate deal points and implement changes to the necessary finance and project implementation documents. The necessary additional work caused Stradling to exceed the $1.5 million not-to-exceed amount provided in the Agreement by $190,000. Stradling timely apprised Authority legal and business staff of the additional amount. Authority business and legal staff recognize the legitimacy of this request, are satisfied with the work performed by Stradling to date, and believe that the increased amount of $190,000 is justified under the circumstances. Therefore, Authority staff recommends that the Authority Board approve a second amendment to the Agreement to increase the not-to-exceed amount to $1.69 million (Attachment A, Second Amendment). In addition, in order to provide for additional legal services from Stradling in order to address issues that are expected to arise in connection with the distribution of funds and construction of the Convention Center, Resort Hotel, and Phase 1A Infrastructure Improvements, Authority staff is also recommending that the Second Amendment include a provision for such additional services, subject to the prior joint approval and direction of the Co-Counsel, and subject to available funds for legal services as set forth in the annual budget of the Authority. Such additional services will not be subject to the not-to-exceed amount of $1.69 million, shall be performed at the hourly rates set forth in Exhibit A of the Agreement (inclusive of out-of-pocket costs), and shall be in an amount not-to-exceed the amount of Authority funds allocated for legal services as set forth in the annual budget of the Authority. The annual budget of the Authority is expected to be prepared in the next few months. Page 3 of 8 Change to Frequency and Location of Regular Meetings of the Authority Board Pursuant to Section 4.C(1) of the Authority Agreement, the Authority Board shall hold its regular meetings at such times and at such locations as may be established by the Bylaws or by resolution of the Authority Board. The Bylaws of the Authority do not establish a schedule for the regular meetings. On December 13, 2021, the Authority Board adopted Resolution No. 2021-004 which provides that the Authority Board shall hold a regular meeting every Wednesday of each month, commencing January 1, 2022, and establishes the location of the regular meetings as the City of Chula Vista located at 276 Fourth Avenue, Chula Vista, California 91910 for the first and third meetings of each month and the San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101 for the second, fourth, and fifth meetings of each month. Resolution No. 2021-004 did not change the time of the regular meetings which continues to be 3:00 pm. On April 13, 2022, the Authority Board adopted Resolution No. 2022-004 which added May 12, 2022 and May 13, 2022 as regular meetings and established the location of the May 12, 2022 and May 13, 2022 at the San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101. While there is still ample work that District and City staff have to perform to implement the various requirements of the Authority Bonds and regulate the construction and implementation of the Phase 1A Infrastructure Improvements and Convention Center, much of the work can be performed through the guidance of previously approved documents and policies of the Authority Board and multiple meetings are no longer required to address time sensitive issues. By reducing the frequency of the meetings, administrative time would be saved from having to cancel meetings each week that are not needed. Staff recommends that the frequency of the regular meetings be limited to once per month, on the third Wednesday of each month, with the location of the regular meeting to alternate each month between the City of Chula Vista City Hall located at 276 Fourth Avenue, Chula Vista, California 91910 and the San Diego Unified Port District, Don L. Nay Administration Building, located at 3165 Pacific Highway, San Diego, California 92101. There is no proposed change to the time of the regular meetings which will continue to take place at 3:00 pm. If the Authority Board accepts staff’s recommendation, the next meeting would occur on September 21, 2022 at 3:00 p.m. at the San Diego Unified Port District, Don L. Nay Administration Building. Virtual Meetings of the Authority Board The Authority Board meeting on August 31st will be held at San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101. California Assembly Bill 361 (AB 361) enacted certain exceptions to the Ralph M. Brown Act (Brown Act) to allow virtual and hybrid meetings of the public agencies when there is a proclaimed state of emergency and state or local officials are recommending measures to promote social distancing. On March 4, 2020, the Governor Page 4 of 8 of California declared a state of emergency related to COVID-19, and the District similarly declared a state of emergency on March 18, 2020. Both state of emergencies remain in force. In addition to other social distancing recommendations by state, federal, and local agencies, on September 23, 2021, Wilma J. Wooten, the Public Health Officer for the County of San Diego, issued a Health Officer Teleconference Recommendation which recommends continued virtual Brown Act meetings to help prevent the spread of COVID- 19. Staff recommends that the Authority Board adopt the resolution (i) authorizing the Co- Counsels of the Authority to execute and deliver the Second Amendment; (ii) authorizing the change to the frequency of the regular meetings of the Authority Board to monthly to occur on the third Wednesday of each month, beginning September 1, 2022, with the location of each monthly meeting alternating between the District and the City; and (iii) making the finding that, based on continued state, federal, and local recommendations for social distancing, the Brown Act meetings of the Authority Board held in accordance with the Brown Act are permitted to use the exceptions to Brown Act rules set forth in AB 361 and such authorization shall not expire if renewed at the following regular meeting of the Authority Board. RECOMMENDATION: ADOPT RESOLUTION: A. AUTHORIZING THE EXECUTION AND DELIVERY OF THE SECOND AMENDMENT; AND B. AUTHORIZING THE CHANGE TO THE FREQUENCY OF THE REGULAR MEETINGS OF THE AUTHORITY BOARD TO ONCE A MONTH ON THE THIRD WEDNESDAY OF EACH MONTH, BEGINNING SEPTEMBER 1, 2022, AND TO ESTABLISH THE LOCATION OF THE REGULAR MEETINGS; AND C. MAKING FINDINGS REGARDING VIRTUAL MEETINGS OF THE AUTHORITY BOARD IN ACCORDANCE WITH THE BROWN ACT AND AB 361 FISCAL IMPACT: The Authority Board’s approval of the Second Amendment will result in an immediate fiscal impact of $190,000. The Authority has sufficient funds to pay for these fees. The performance of additional legal services by Stradling is limited to those special services jointly approved and directed by the Co-Counsels of the Authority and the payment of such special services is limited to such amount as is allocated to legal services in the annual budget of the Authority. The requested Authority Board action to change the frequency of the Authority Board regular meetings to once a month on the third Wednesday of each month and establish the location of the regular meetings will not immediately result in a direct fiscal impact to Page 5 of 8 the Authority, as the Authority Board’s action does not authorize the use of any public funds and the Authority Agreement provides for a mechanism for the District and the City to recover the cost of services performed by the officers who are employed by the District and the City, as applicable. The requested Authority Board action to make findings regarding virtual meetings of the Authority Board will not have a fiscal impact on the Authority. DISCUSSION: I. Second Amendment to Stradling Agreement The material provisions of the Second Amendment are (1) to increase the not-to-exceed amount of the Agreement to pay for the additional legal services performed by Stradling in the amount of $190,000; and (2) provide a mechanism for Co-Counsel to administer the Agreement and continue to procure services from Stradling on an as needed basis based on the budget that is allocated for legal services in the Authority’s annual budget. The special services would include a wide range of services needed to implement the various requirements of the Authority Bonds and regulate the construction and implementation of the Phase 1A Infrastructure Improvements and Convention Center. Examples include compliance with the Authority Bonds, revisions to the documents or agreements related to the Authority Bonds, or the drafting of any documents that may be necessary or appropriate in the opinion of the Co-Counsel to implement the financing, operation and construction of the Phase 1A Infrastructure Improvements and Convention Center. The performance of special services is not guaranteed and is subject to the joint prior approval and direction of the Co-Counsels. If special services are requested, the special services are not subject to the not-to-exceed amount of $1.69 million, are to be performed at the previously negotiated hourly rates set forth in the Agreement (inclusive of out-of-pocket costs), and are to be in an amount not-to-exceed the amount of Authority funds allocated for legal services as set forth in the annual budget of the Authority. II. Change to Frequency of Regular Authority Board Meetings Pursuant to Section 4.C(1) of the Authority Agreement, the Authority Board shall hold its regular meetings at such times and at such locations as may be established by the Bylaws or by resolution of the Authority Board. The Bylaws of the Authority do not establish a schedule for the regular meetings. On December 13, 2021, the Authority Board adopted Resolution No. 2021-004 which provides that the Authority Board shall hold a regular meeting every Wednesday of each month, commencing January 1, 2022, and establishes the location of the regular meetings as the City of Chula Vista located at 276 Fourth Avenue, Chula Vista, California 91910 for the first and third meetings of each month and the San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101 for the second, fourth, and fifth meetings of each month. Resolution No. 2021-004 did not change the time of the regular meetings which continues to be 3:00 pm. On April 13, 2022, the Authority Board adopted Resolution No. 2022-004 which added May 12, 2022 and May 13, 2022 as regular meetings and Page 6 of 8 established the location of the May 12, 2022 and May 13, 2022 at the San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101. The Authority Board meeting on August 31st will be held at San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101. While there is still ample work that District and City staff have to perform to implement the various requirements of the Authority Bonds and regulate the construction and implementation of the Phase 1A Infrastructure Improvements and Convention Center, much of the work can be performed through the guidance of previously approved documents and policies of the Authority Board and multiple meetings are no longer required to address time sensitive issues. By reducing the frequency of the meetings, administrative time would be saved from having to cancel meetings each week that are not needed. Staff recommends that the frequency of the regular meetings be limited to once per month, on the third Wednesday of each month, with the location of the regular meeting to alternate each month between the City of Chula Vista City Hall located at 276 Fourth Avenue, Chula Vista, California 91910 and the San Diego Unified Port District, Don L. Nay Administration Building, located at 3165 Pacific Highway, San Diego, California 92101. There is no proposed change to the time of the regular meetings which will continue to take place at 3:00 pm. If the Authority Board accepts staff’s recommendation, the next meeting would occur on September 21, 2022 at 3:00 p.m. at the San Diego Unified Port District, Don L. Nay Administration Building. III. Authority Board Virtual Meetings in Accordance with the Brown Act and AB 361 AB 361 enacted certain exceptions to the Brown Act to allow virtual and hybrid meetings of the public agencies when there is a proclaimed state of emergency and state or local officials are recommending measures to promote social distancing. On March 4, 2020, the Governor declared a state of emergency related to COVID-19 which still remains in effect. The District declared a state of emergency on March 18, 2020 which also still remains in effect. Several state, federal, and local agencies continue to recommend social distancing to prevent the spread of COVID-19. For example: • On September 23, 2021, Wilma J. Wooten, the Public Health Officer for the County of San Diego, issued a Health Officer Teleconference Recommendation which recommends continued virtual Brown Act meetings to help prevent the spread of COVID- 19. • Cal-OSHA adopted temporary emergency standards for workplaces that do not require social distancing but do require employers to provide effective training and Page 7 of 8 instruction to employees that includes “The fact that particles containing the virus can travel more than six feet, especially indoors, so physical distancing, face coverings, increased ventilation indoors, and respiratory protection decrease the spread of COVID- 19, but are most effective when used in combination.” [Available at: https://www.dir.ca.gov/dosh/coronavirus/ETS.html.] • The California Department of Healthcare Services, which administers the state’s Medi-Cal program provides the following in its Frequently Asked Questions for Medi-Cal beneficiaries: “Even after being vaccinated, people will still need to practice other precautions, like wearing a mask, social distancing, handwashing, and other hygiene measures, until public health officials say otherwise.” [Available at https://www.dhcs.ca.gov/Documents/COVID-19/COVID-19-Vaccine- Beneficiary-FAQ.pdf.] • The California Department of Public Health has issued guidance about additional vaccine doses for persons who are immunocompromised. The guidance contains the following: “As a person with a weak immune system, once I get an additional dose, can I reduce the use of other precautions such as masking, distancing, and avoiding groups and crowds.” A: “No, because even with an extra dose of mRNA vaccine, not everyone with a compromised immune system appears to mount a normal immune response. We are still learning about this, but at this time, we consider it prudent to continue taking extra precautions.” [Available at: https://www.cdph.ca.gov/Programs/CID/DCDC/Pages/COVID- 19/ThirdVaccineDoseQandA.aspx.] Therefore, staff recommends the Authority Board adopt a resolution making the finding that, based on continued state, federal, and local recommendations for social distancing, the Brown Act meetings of the Authority Board are permitted to use the exceptions to Brown Act rules set forth in AB 361. And further, that this authorization expires if not renewed at the next regular meeting of the Authority Board that is not cancelled. III. Recommendation As more fully discussed above, staff recommends that the Authority Board adopt the resolution (a) authorizing the execution and delivery of the Second Amendment; (b) authorizing the change to the frequency of the regular meetings of the Authority Board to monthly to occur on the third Wednesday of each month, beginning September 1, 2022, with the location of each monthly meeting alternating between the District and the City; and (c) making the finding that, based on continued state, federal, and local recommendations for social distancing, the Brown Act meetings of the Authority Board are permitted to use the exceptions to Brown Act rules set forth in AB 361. Page 8 of 8 Co-Counsel’s Comments: Each Co-Counsel has reviewed this agenda sheet and Attachment A as presented to him or her and approve each as to form and legality. Environmental Review: The proposed action by the Authority Board is to adopt a resolution approving the execution and delivery of the Second Amendment, approving the change to the frequency of the regular meetings and location of the regular meetings, and making the finding that, based on continued state, federal, and local recommendations for social distancing, the Brown Act meetings of the Authority Board are permitted to use the exceptions to Brown Act rules set forth in AB 361. The proposed action does not constitute a “project” under the definition as set forth in the California Environmental Quality Act (CEQA Guidelines § 15378(b)(2)) because they will not have a potential to result in a direct or indirect physical change in the environmental and are, therefore, not subject to CEQA. No further action under CEQA is required. In addition, the proposed Authority Board action would not conflict with the Port Act of the District or the Public Trust Doctrine. Finally, the proposed action does not allow for “development,” as defined in Section 30106 of the California Coastal Act, or “new development,” pursuant to Section 1.a. of the District’s Coastal Development Permit Regulations. Therefore, issuance of a Coastal Development Permit or exclusion is not required. PREPARED BY: Elizabeth C. Alonso Deputy Co-Counsel Michael Shirey Deputy Co-Counsel Attachment(s): Attachment A: Second Amendment 1 SECOND AMENDMENT TO BOND COUNSEL AND DISCLOSURE COUNSEL AGREEMENT CHULA VISTA BAYFRONT FACILITIES FINANCING AUTHORITY BAYFRONT PROJECT This SECOND AMENDMENT (“Second Amendment”) is entered into effective as of this ______ day of _________, 2022 (the “Effective Date”) by and between the CHULA VISTA BAYFRONT FACILITIES FINANCING AUTHORITY, a California joint powers authority organized and existing under the laws of the State of California (“Authority”) and STRADLING, YOCCUM, CARLSON & RAUTH, a Professional Corporation (“Stradling”) with reference to the following facts: RECITALS WHEREAS, the Authority and Stradling previously entered into a Bond Counsel and Disclosure Counsel Agreement (the “Original Agreement”) on April 1, 2020; and WHEREAS, the Original Agreement provided for a not-to-exceed legal services fee amount of $450,000; WHEREAS, in light of the substantial increase in the complexity of the deal structure and the corresponding increase in the amount of negotiations, analysis and document production time (drafting and redrafting) required to produce final versions of the many lease, project development and public financing documents required for the project, Stradling requested an increase in the not-to-exceed legal services amount to $1.5 million; and WHEREAS, because Authority business and legal staff recognized the legitimacy of this request, were satisfied with the work performed by Stradling to date, and believed that the increased maximum amount of $1.5 million was justified under the circumstances, recommended that the Board of Directors of the Authority (“Authority Board”) approve a contract amendment reflecting such increase (“First Amendment”, together with the Original Agreement, the “Agreement”); and WHEREAS, the Authority Board considered and approved the First Amendment at its meeting on October 6, 2021 and authorized Co-General Counsel to execute the First Amendment on its behalf; and WHEREAS, subsequent to the Authority’s approval of the First Amendment, changes in the public finance market occurred requiring additional modifications to the transaction, and substantial additional, unforeseen legal work by Stradling in order to restructure certain elements of the deal, renegotiate deal points and implement changes to the necessary finance and project implementation documents; and 2 WHEREAS, the necessary additional work caused Stradling to exceed the $1.5 million dollar not-to-exceed amount provided in the Agreement; and WHEREAS, Stradling timely apprised Authority legal and business staff of the additional work required and now requests that the Authority amend the Agreement to approve an additional amount of $190,000 in consideration of the worked required to close the transaction; and WHEREAS, because Authority business and legal staff recognized the legitimacy of this request, are satisfied with the work performed by Stradling to date, and believe that the increased amount of $190,000 is justified under the circumstances, Authority staff recommended that the Authority Board approve a contract amendment reflecting such increase (“Second Amendment”); and WHEREAS, in order to provide for additional legal services from Stradling to address issues that are expected to arise in connection with the distribution of funds and construction of the Gaylord Pacific and Convention Center Project (“Project”), Authority staff is also recommending that the Second Amendment include a provision for such additional services, subject to the prior joint approval and direction of the Co-General Counsel, and subject to available funds for legal services as set forth in the annual budget of the Authority; and WHEREAS, such additional services will be performed at the hourly rates set forth in Exhibit A of the Agreement. NOW, THEREFORE, in consideration of the above recitals and the mutual obligations of the parties set forth herein, Authority and Stradling agree as follows: 1. Section 2.A of the Agreement is hereby amended as follows: The not-to-exceed total amount is amended from $1.5 million to $1.69 million. 2. Section 1.B of the Agreement is hereby amended to read in its entirety as follows: For purposes of this Agreement, “Special Services” may include the services outlined in Section 1.A above in addition to other services including, but not be limited to, any legal work performed by Stradling after the issuance of the Authority Bonds related to the amendment of the Authority Bonds, the documents or agreements related to the Authority Bonds, or that may be necessary or appropriate in the opinion of the Co- General Counsel to implement the financing, operation and construction of the Hotel Project or the Financed Improvements. The performance of “Special Services” is not guaranteed and shall be subject to the joint prior approval and direction of the Co- General Counsel. If Special Services are requested, the Special Services shall not be subject to the not-to-exceed amount set forth in Section 2.A of the Agreement, shall be performed at the hourly rates set forth in Exhibit A of the Agreement (inclusive of out- of-pocket costs), and shall be in an amount not-to-exceed the amount of Authority funds allocated for legal services as set forth in the annual budget of the Authority. 3 Stradling will not be compensated for services provided once the maximum budget for legal services under the Authority annual budget is reached without amendment to this Agreement. Stradling shall not be required to perform further services after the maximum compensation has been reached. However, Stradling shall monitor total expenditures under this Agreement and shall give both of the Co-General Counsel prompt written notice when 60% of the maximum is reached, and again when 80% of the maximum is reached, and any other time that Stradling anticipates the need for services in excess of the maximum amount. Whether or not notice is given by Stradling, if Stradling performs work in excess of the maximum amount authorized by this Agreement, it does so as its own risk. Only a written amendment to this Agreement, executed by both the Co-General Counsel, increasing the amount of compensation can obligate the Authority to pay for such services, and only such amendment is in the sole and absolute discretion of each of the Co-General Counsel. 3. Section 3 of the Agreement is hereby amended to delete the last sentence and replace it with the following sentence: This Agreement will be administered by the Co-General Counsel of the Authority, or their designees. 4. Section 5.C of the Agreement is hereby amended to delete the last sentence. 5. Except as expressly provided herein, all other terms and conditions of the Agreement shall remain in full force and effect. 6. Each party represents that it has full right, power and authority to execute this Second Amendment and to perform its obligations hereunder, without the need for any further action under its governing instruments, and the parties executing this Second Amendment on the behalf of such party are duly authorized agents with authority to do so. 7. This Second Amendment may be executed in any number of counterparts, each of which shall be the original and all of which shall constitute one and the same document. The words “execution”, “execute”, “signed”, “signature”, and words of like import in or related to any document signed or to be signed in connection with this Second Amendment and the transaction contemplated hereby shall be deemed to include electronic signatures, contract formations on electronic platforms approved by the parties, or the keeping of such electronic signatures and electronic contracts in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the California Uniform Electronic Transaction Act, or any other similar state laws based on the Uniform Electronic Transactions Act. (Signature Page Follows.) 4 SIGNATURE PAGE TO SECOND AMENDMENT TO BOND COUNSEL AND DISCLOSURE COUNSEL AGREEMENT CHULA VISTA BAYFRONT FACILITIES FINANCING AUTHORITY BAYFRONT PROJECT STRADLING, YOCCUM, CARLSON & RAUTH, A PROFESSIONAL CORPORATION CHULA VISTA BAYFRONT FACILITIES FINANCING AUTHORITY BY:________________________________ BY: ________________________________ Robert J. Whalen Thomas A. Russell Shareholder Co-General Counsel BY:________________________________ Glen R. Googins Co-General Counsel https://chulavistaca-my.sharepoint.com/personal/mshirey_chulavistaca_gov/Documents/Covid-19 Work From Home/CVB-FinancingAuthority- JPA/Agreements/JEPA-1stAmend-StradlingK-9.14.21-Final.docx https://chulavistaca-my.sharepoint.com/personal/mshirey_chulavistaca_gov/Documents/Covid-19 Work From Home/CVB-FinancingAuthority- JPA/Agreements/RevFinals/JEPA-1stAmend-StradlingK-9.21.21-GRGRevFinal.docx 2022-0XX Page 1 of 7 CHULA VISTA BAYFRONT FACILITIES FINANCING AUTHORITY RESOLUTION 2022-0XX RESOLUTION (A) AUTHORIZING THE CO- COUNSELS OF THE CHULA VISTA BAYFRONT FACILITIES FINANCING AUTHORITY (AUTHORITY) TO EXECUTE AND DELIVER A SECOND AMENDMENT TO THE LEGAL SERVICES AGREEMENT WITH STRADLING YOCCA CARLSON & RAUTH (STRADLING) FOR BOND COUNSEL AND DISCLOSURE COUNSEL SERVICES (STRADLING CONTRACT) FOR A NOT- TO-EXCEED AMOUNT OF $1.69 MILLION AND TO AMEND THE STRADLING CONTRACT TO PERMIT CO-COUNSEL TO ENGAGE STRADLING FOR ADDITIONAL SPECIAL SERVICES; (B) AUTHORIZING CHANGES TO THE FREQUENCY OF THE REGULAR MEETINGS OF THE BOARD OF DIRECTORS OF THE AUTHORITY (AUTHORITY BOARD) TO ONCE A MONTH ON THE THIRD WEDNESDAY OF EACH MONTH, BEGINNING SEPTEMBER 1, 2022, AND TO ESTABLISH THE LOCATION OF THE REGULAR MEETINGS; AND (C) MAKING FINDINGS REGARDING VIRTUAL MEETINGS OF THE AUTHORITY BOARD IN ACCORDANCE WITH THE RALPH M. BROWN ACT AND CALIFORNIA ASSEMBLY BILL 361 WHEREAS, the Chula Vista Bayfront Facilities Financing Authority (Authority) was formed through that certain Joint Exercise of Powers Agreement between the City of Chula Vista (City) and the San Diego Unified Port District (District) dated as of May 1, 2014 and filed in the Office of the District Clerk as Document No. 61905 (Original Authority Agreement), as amended and restated by that certain Amended and Restated Joint Exercise of Powers Agreement between the City and District dated July 25, 2019 and filed in the Office of the District Clerk as Document No. 70245 (A&R Authority Agreement), and as further amended by that certain Amendment No. 1 to the Amended and Restated Joint Exercise of Powers Agreement dated August 10, 2022 (Amendment No. 1, together with the A&R Authority Agreement, the Authority Agreement); and WHEREAS, the District and the City (each, a Member of the Authority) are the sole members of the Authority; and WHEREAS, the District and the City have been working collaboratively for DRAFT 2022-0XX Page 2 of 7 decades to plan and implement the Chula Vista Bayfront Master Plan (CVBMP); and WHEREAS, since 2014, the District and the City have been working to deliver the catalyst project for the CVBMP, an approximately 275,000 net usable square foot convention center (Convention Center) and a 1,570 to 1,600 room resort hotel (Resort Hotel) to be located on Parcel H3 of the CVBMP; and WHEREAS, the project also requires the construction of extensive public infrastructure to the areas surrounding Parcel H3 (Phase 1A Infrastructure Improvements); and WHEREAS, on May 26, 2022, the Authority issued tax and tax-exempt bonds (collectively, Authority Bonds) to finance the public contribution for the construction of the Convention Center and Phase 1A Infrastructure Improvements; and WHEREAS, since the issuance of the Authority Bonds, the District and the City have moved into the next phase, which requires Authority staff to implement the various requirements of the Authority Bonds and regulate the construction and implementation of the Phase 1A Infrastructure Improvements and Convention Center; and WHEREAS, the Authority and Stradling, Yocca, Carlson & Rauth (Stradling) entered into a Bond Counsel and Disclosure Counsel Agreement (Original Agreement) on April 1, 2020; and WHEREAS, the Original Agreement provided for a not-to-exceed legal services fee amount of $450,000; and WHEREAS, the not-to-exceed amount was amended on October 6, 2021 to $1.5 million through the approval by the Board of Directors of the Authority (Authority Board) of a First Amendment to the Original Agreement (the First Amendment, together with the Original Agreement, are hereinafter referred to as the “Agreement”); and WHEREAS, subsequent to the Authority’s approval of the First Amendment, changes in the public finance market occurred requiring additional modifications to the transaction, and substantial additional, unforeseen legal work by Stradling in order to restructure certain elements of the deal, renegotiate deal points and implement changes to the necessary finance and project implementation documents; and WHEREAS, the necessary additional work caused Stradling to exceed the $1.5 million not-to-exceed amount provided in the Agreement by $190,000 and Stradling timely apprised Authority legal and business staff of the additional amount; and WHEREAS, Authority business and legal staff recognize the legitimacy of this request, are satisfied with the work performed by Stradling to date, and believe 2022-0XX Page 3 of 7 that the increased amount of $190,000 is justified under the circumstances and recommends that the Authority Board approve a second amendment to the Agreement to increase the not-to-exceed amount to $1.69 million (Exhibit A, Second Amendment); and WHEREAS, in order to provide for additional legal services from Stradling in order to address issues that are expected to arise in connection with the distribution of funds and construction of the Convention Center, Resort Hotel, and Phase 1A Infrastructure Improvements, Authority staff is also recommending that the Second Amendment include a provision for additional special services; and WHEREAS, the special services would include a wide range of services needed to implement the various requirements of the Authority Bonds and regulate the construction and implementation of the Phase 1A Infrastructure Improvements and Convention Center; and WHEREAS, examples of the special services include compliance with the Authority Bonds, revisions to the documents or agreements related to the Authority Bonds, or the drafting of any documents that may be necessary or appropriate in the opinion of the Co-Counsel to implement the financing, operation and construction of the Phase 1A Infrastructure Improvements and Convention Center; and WHEREAS, the performance of special services is not guaranteed and is subject to the joint prior approval and direction of the Co-Counsels of the Authority; and WHEREAS, if special services are requested, the special services are not subject to the not-to-exceed amount of $1.69 million, are to be performed at the previously negotiated hourly rates set forth in the Agreement (inclusive of out-of- pocket costs), and are to be in an amount not-to-exceed the amount of Authority funds allocated for legal services as set forth in the annual budget of the Authority; and WHEREAS, pursuant to Section 4.C(1) of the Authority Agreement, the Authority Board shall hold its regular meetings at such times and at such locations as may be established by the Bylaws or by resolution of the Authority Board; and WHEREAS, the Bylaws of the Authority do not establish a schedule for the regular meetings; and WHEREAS, on December 13, 2021, the Authority Board adopted Resolution No. 2021-004 which provides that the Authority Board shall hold a regular meeting every Wednesday of each month, commencing January 1, 2022, and establishes the location of the regular meetings as the City of Chula Vista located at 276 Fourth Avenue, Chula Vista, California 91910 for the first and third meetings of each month and the San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101 for the second, fourth, and fifth meetings of each month; and 2022-0XX Page 4 of 7 WHEREAS, Resolution No. 2021-004 did not change the time of the regular meetings which continues to be 3:00 pm; and WHEREAS, on April 13, 2022, the Authority Board adopted Resolution No. 2022-004 which added May 12, 2022 and May 13, 2022 as regular meetings and established the location of the May 12, 2022 and May 13, 2022 at the San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101; and WHEREAS, while there is still ample work that District and City staff have to perform to implement the various requirements of the Authority Bonds and regulate the construction and implementation of the Phase 1A Infrastructure Improvements and Convention Center, much of the work can be performed through the guidance of previously approved documents and policies of the Authority Board and multiple meetings are no longer required to address time sensitive issues; and WHEREAS, by reducing the frequency of the meetings, administrative time would be saved from having to cancel meetings each week that are not needed; and WHEREAS, staff recommends that the frequency of the regular meetings be limited to once per month, on the third Wednesday of each month, with the location of the regular meeting to alternate each month between the City of Chula Vista City Hall located at 276 Fourth Avenue, Chula Vista, California 91910 and the San Diego Unified Port District, Don L. Nay Administration Building, located at 3165 Pacific Highway, San Diego, California 92101; and WHEREAS, there is no proposed change to the time of the regular meetings, which will continue to take place at 3:00 pm, and if the Authority Board accepts staff’s recommendation, the next meeting would occur on September 21, 2022 at 3:00 p.m. at the San Diego Unified Port District, Don L. Nay Administration Building; and WHEREAS, California Assembly Bill 361 (AB 361) enacted certain exceptions to the Ralph M. Brown Act (Brown Act) to allow virtual and hybrid meetings of the public agencies when there is a proclaimed state of emergency and state or local officials are recommending measures to promote social distancing; and WHEREAS, on March 4, 2020, the Governor of California declared a state of emergency related to COVID-19 which still remains in effect; and WHEREAS, the District declared a state of emergency on March 18, 2020 which still remains in effect; and WHEREAS, in addition to other social distancing recommendations by state, federal, and local agencies, on September 23, 2021, Wilma J. Wooten, the Public Health Officer for the County of San Diego, issued a Health Officer Teleconference Recommendation which recommends continued virtual Brown Act 2022-0XX Page 5 of 7 meetings to help prevent the spread of COVID-19; and WHEREAS, the August 31, 2022 Authority Board meeting will be held at the San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101; and WHEREAS, staff recommends that the Authority Board adopt a resolution making the finding that, based on continued state, federal, and local recommendations for social distancing, the meetings of the Authority Board held in accordance with the Brown Act are permitted to use the exceptions to Brown Act rules set forth in AB 361; and further, that this authorization expires if not renewed at the following regular meeting of the Authority Board that is not cancelled. NOW THEREFORE, BE IT RESOLVED by the Board of Directors of the Chula Vista Bayfront Facilities Financing Authority (Authority Board) as follows: a. The Authority Board hereby directs the Co-Counsels of the Chula Vista Bayfront Facilities Financing Authority (Authority) to execute and deliver the Second Amendment to Bond Counsel and Disclosure Services for legal services with Stradling Yocca Carlson & Rauth in substantially the form attached hereto as Exhibit A. b. The Authority Board hereby authorizes the changes to the frequency of the regular meetings of the Authority Board to once a month on the third Wednesday of each month, beginning September 1, 2022, with the location of the regular meetings alternating between the offices of the City of Chula Vista and the San Diego Unified Port District. c. The Authority Board hereby finds that, based on continued state, federal, and local recommendations for social distancing, the meetings of the Authority Board held in accordance with the Ralph M. Brown Act (“Brown Act”) are permitted to use the exceptions to Brown Act rules set forth in California Assembly Bill 361; and further, that this authorization shall expire if not renewed at the following regular meeting of the Authority Board that is not cancelled. APPROVED AS TO FORM AND LEGALITY: CO-COUNSEL Thomas A. Russell, General Counsel, San Diego Unified Port District Glen R. Googins, City Attorney, City of Chula Vista 2022-0XX Page 6 of 7 PASSED AND ADOPTED by the Board of Directors of the Chula Vista Bayfront Facilities Financing Authority, this 31st day of August 2022, by the following vote: AYES: NAYS:. EXCUSED: ABSENT: ABSTAIN: Mary Casillas Salas, Chair Board of Directors ATTEST: __________________________________ Donna Morales Secretary 2022-0XX Page 7 of 7 EXHIBIT A SECOND AMENDMENT TO STRADLING CONTRACT (to be attached prior to execution.)