Loading...
HomeMy WebLinkAboutReso 1988-13716 RESOLUTION NO. 13716 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA APPROVING AGREEMENT BETWEEN THE CITY OF CHULA VISTA AND EASTLAKE DEVELOPMENT COMPANY FOR THE M~INTENANCE OF TELEGRAPH CANYON CHANNEL AND AUTHORIZING THE MAYOR TO EXECUTE SAID AGREEMENT The City Council of the City of Chula Vista does hereby resolve as follows: NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Chula Vista that that certain agreement between THE CITY OF CHULA VISTA, a municipal corporation, and EASTLAKE DEVELOPMENT COMPANY, for the maintenance of Telegraph Canyon Channel dated the 2nd day of August , 198 8, a copy of which is attached hereto and incorporated herein, the same as though fully set forth herein be, and the same is hereby approved. BE IT FURTHER RESOLVED that the Mayor of the City of Chula Vista be, and he is hereby authorized and directed to execute said agreement for and on behalf of the City of Chula Vista. Presented by Approved as to form by u374a ADOPTED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF HUL. JISTA, CALIFORNIA, this 2nd dQy Of. August ~ 88 , by the following vote, to--wit: YES: Councilmembers Cox, McCaudZiss, Nader, Malcolm, Moore AYES: Counci 1 members None BSTAIN: Councilmembers None BSENT: Cound ] members None '~~'~~~/he/~ffy of Chulo Vista TTEST ~ ~ ~~,-~---- c,,y rAT, F CALIFORNIA ) DUNTY OF SAN DIEGO ) ss. TY OF CHULA VISTA ) I, JENNIE M. FULASZ, CMC, CITY CLERK of the City of Chula Vista, California, HEREBY CERTIFY thot the obove ond foregoing is 0 full, true ond correct copy of RESOLUTION N0. 13716 ,ond fhot the some hos not been omendedor repeoled ~TED City Clerk CI1Y OF CHULA VISIA ~-660 AGREEMENT FOR THE MAINTENANCE OF DRAINAGE CHANNEL AND ESTABLISHMENT OF CHANNEL MAINTENANCE DISTRICT This Agreement is entered into on this 2nd day of Augus~ 1988, by and between THE CITY OF CHULA VISTA ("City"), a municipal corporation, and EASTLAKE DEVELOPMENT COMPANY, a California general partnership consisting of corporations ("EDC") based on the following facts and circumstances: RECITALS 1. The EastLake I Public Facilities Financing Plan requires the widening of Telegraph Canyon Road/Otay Lakes Road. This widening requires the construction of a drainage channel ~ "Channel") of varying widths and approximately three miles (16,200 linear feet) in length. 2. The road widening project necessitates the relocation of the existing drainage course to the ultimate one hundred (100) year storm design. 3. The City and EDC both desire to establish a drainage Channel Maintenance District as quickly as possible but recognize that some period of maintenance may be required until the formation of the district. 4. The road improvements are currently planned to be constructed in three phases identified in Exhibit A. The Channel improvements will be constructed concurrently with each road phase. NOW, THEREFORE, IN CONSIDERATION OF THE ABOVE FACTS, AND FOR EHER VALUABLE CONSIDERATION, RECEIPT OF WHICH IS HEREBY ACKNOWLEDGED, THE PARTIES AGREE AS FOLLOWS: 1. Obligations of EDC 1.1. Maintenance by EDC. For a period of one year from the date a Notice of Completion is filed for each phase of the Channel construction, (pursuant to City's standard timing and practice for such Notice), EDC shall maintain at its sole cost and expense, that portion of the Channel for which construction is then complete. 1.2. Maintenance by City. For each of the next two years after each phase of the Channel is completed, or until the Channel Maintenance District is formed, whichever occurs first, EDC shall pay to the City the costs of Channel maintenance for .~hatever phases of the Channel have been completed. At the beginning of each fiscal year, the City shall prepare a scope of work and cost estimate for the Channel maintenance and submit them to EDC for review. EDC will have the opportunity to review and discuss with the City the proposed scope of work. EDC shall remit payment in full within sixty (60) days. If, and only if, payment is not made within sixty (60) days, the City shall draw upon the security posted by EDC as described in Section 1.3, below, for said amount. The maximum maintenance costs per phase are: Phase I, $8,750.00, Phase II, $17,850.00; Phase III, $8,400.00. 1.3. Prepaid Maintenance Costs. In addition to the obligations set forth in Section 1.1 and 1.2 to maintain the Channel, EDC shall post Letters of Credit or alternate security -2- ~cceptable to the City in the total amount of Five Hundred ~housand Dollars ($500,000.00), hereafter referred to as the "Principal", which is estimated to be an amount which will generate a yearly interest return sufficient to fund future maintenance requirements. The Letters of Credit or alternate security acceptable to the City shall be provided in accordance with the requirements of Section 1.4 below, and shall remain in force for a period of three years or until the Channel Maintenance District is formed, whichever occurs first. If the Channel Maintenance District is not formed within a period of three (3) years from the completion of the first phase of Channel construction, the City will make a written demand on EDC for that portion of the security listed in Section 1.4 below. EDC will -emit the requested amount within sixty (60) days. If EDC does not remit the requested amount within the specified time, the City shall have the right to draw down the Letters of Credit or alternate security acceptable to the City, and deposit said funds in an interest bearing account to be used exclusively for the maintenance of the Channel. 1.4. It is the City's intention to utilize the Principal received from EastLake as a trust fund using only the interest earnings to cover the yearly maintenance costs of each completed portion of the Channel; however, because a full year's interest may not be accrued prior to the time the City must expend funds for the maintenance of the Channel, EDC shall provide a Letter of Credit or other security satisfactory to the 7ity by phase in the amounts shown in Section 1.5. This security -3- 13 will be utilized to supplement the interest earned during a partial year the Principal is on deposit. It shall be posted by phase at the same time the principal security in Section 1.5 is posted. For purposes of this section, "interest" shall be defined as the interest regularly paid on similar interest bearing accounts by the institution of the City's choice for maintaining the above-mentioned trust fund account; provided, however, that if such amount is less, on a pro rata basis, than the amounts contained in Section 1.2, EDC'S maximum liability shall be limited to the amounts countained in Section 1.2. 1.5. Posting of the Letters of Credit or Alternate Security Acceptable to the City. For each phase of the Channel Improvements, Letters of Credit or alternate security acceptable ~Io the City shall be posted in an amount which represents the prorata portion of the entire Channel which that phase bears to the whole with the City on a date which is one year from the date of completion of that phase of the Channel as follows: Supplemental Principal Security Amounts Amounts Phase I (4,500 ft.) 28% $ 140,000 $ 8,750 Phase II (8,600 ft.) 53% 265,000 17,850 Phase III (3,100 ft.) 19% 95,000 8,400 $ 500,000 $35,000 provided, however, that the Letter of Credit or alternate security satisfactory to the City shall in no event be posted later than the date on which the bond or other security for the guaranty and warranty of improvements (on the Channel) is released, or in the event that no such bond has been posted, no -4- /3 ?/~ ~ater than the date on which the faithful performance bond for Construction of the Channel is released. 1.6. EDC agrees to advance to the City of Chula vista such funds as may be reasonably necessary for the formation of the Channel Maintenance District. These costs for the formation of the district shall be reimbursed from fees collected from the Channel Maintenance District after it is formed. 2. Obligations of City 2.1. The City shall use its best efforts in, and diligently pursue, the formation of the Channel maintenance district, which will include as much as practicable, all of the land within the drainage basin served by the Channel IImprovements. 2.2. The City shall cooperate with the County of San Diego and use its best efforts to include in the Channel maintenance district all property within the drainage basin which is within the jurisdiction of the County. 2.3. In the event that EDC remits cash or the City draws down the Letters of Credit or alternate security satisfactory to the City, the City shall place the proceeds in a separate interest-bearing account earmarked solely and specifically for the purpose of defraying the costs of Telegraph Canyon Road/0tay Lake Road Channel maintenance within the reaches shown on Exhibit A, and neither the principal nor the interest may be used for any other purpose. -5- /3 2.4. In the event that the Channel Maintenance District is formed after cash is remitted or the Letters of Credit or alternate security satisfaction to the City has been drawn upon, and placed into the account described in Section 2.4, the security so deposited, plus accumulated interest, or any portion thereof remaining after all duly incurred expenses to that point have been paid, shall be returned to EDC. 2.5. Attorneys' Fees. In the event either party commences litigation for a specific performance or damages for the breach of this Agreement, the prevailing party shall be entitled to a judgment against the other for an amount equal to reasonable attorneys fees and court costs incurred. 2.6. Severability. If any provision of this Agreement is held invalid, the remainder of this Agreement shall not be affected thereby, if the remainder within continues to conform to applicable law. CITY OF~VISTA~. ~ EASTLAKE DEVELOPMENT COMPANY, a California general partnership its