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HomeMy WebLinkAboutSOUTH COAST PLAZAINSURANCE NOT REQUIRED WORK MAY PROCEED CITY CLERK DATE- JAN 2 9 2024 0., vwo) REIMBURSEMENT AND INDEMNIFICATION AGREEMENT BETWEEN THE CITY OF SANTA ANA AND SOUTH COAST PLAZA FOR THE PAYMENT OF FEES AND COSTS RELATED TO CONTRACT ENVIRONMENTAL AND/OR LEGAL SERVICES FOR THE VILLAGE SANTA ANA SPECIFIC PLAN AND DEVELOPMENT AGREEMENTS N-2024-043 This Reimbursement and Indemnification Agreement ("Agreement") is entered into as of January,, 2024, by and between the CITY OF SANTA ANA, a charter city and municipal corporation, organized and existing under the Constitution and laws of the State of California ("City"), and SOUTH COAST PLAZA, a California general partnership, ("Developer"), who agree as follows: 1. Recitals, This Agreement is made with reference to the following facts and circumstances: A. Developer is seeking to obtain entitlements for certain real property described as The Village Santa Ana Specific Plan located on the northeast corner of West Sunflower Avenue and South Bear Street, transected by South Plaza Drive. The project site comprises seven parcels (Assessor's Parcel Numbers 412-451-01 through -04 and 412-131-10, -20, -21) and the primary project address is 1561 W. Sunflower Avenue, in the City of Santa Ana ("Property') and described in further detail in the attached Legal Description (Exhibit A). Developer has submitted an Amendment Application (zone change) to establish a Specific Plan (SP) to facilitate the development of the Property as a mixed -use community consisting of up to 1,583 residential units (encompassing approximately 1,850,000 square feet), up to 80,000 square feet of retail space, and 300,000 square feet of office space (the "Project"). The discretionary applications also consist of a Development Agreement (DA), Amendment Application (AA) and Tentative Tract Map (TTM). Collectively, the SP, DA, AA and TTM are referred to herein as the "Proposed Entitlements." B. Pursuant to Section 15162 of the California Environmental Quality Act (CEQA) Guidelines, the Proposed Entitlements require preparation of a Subsequent Environmental Impact Report (SEIR). C. City does not have sufficient personnel to prepare and review the Proposed Entitlements, SEIR and other related studies, reports and analyses for the Project that may be needed. In order for City to process the Project, City is in need of contracting with consultants and external legal counsel for specialized services. The work to be performed by such persons and firms in processing the Project is collectively referred to herein as the "Services." D. City believes it is in the public interest for Developer to pay for such Services. E. Developer desires to move forward with the processing of its Project subject to the reimbursement obligations set forth herein. 2. Agreement to Pay for Services. Developer agrees to pay for all reasonable professional costs and expenses related to the Services as provided for in this Agreement. 3. Legal and/or Consultant Services. A. For the purpose of conducting the environmental analysis associated with the SEIR, the Environmental Consultant and their subcontractors will review technical analysis prepared by the Developer, which include any studies deemed necessary by the City and its Environmental Consultant to properly conduct the environmental analysis. B. The Developer has submitted a draft Specific Plan and intends to submit technical studies that will need to be reviewed by the City and the Environmental Consultant. C. The City has received a proposal to provide specialized legal services from Best Best & Krieger LLP at the following rates: Partner $550 to $530 per hour Associates $360 to $310 per hour Paralegals $200 per hour D. The City Attorney's Office will provide Services in connection with this Project, on an hourly basis. The City Attorney's Office hourly billing rate for reimbursable services is Two Hundred Twenty -Five Dollars ($225.00) per hour and is not subject to a 15-percent administrative overhead fee. Upon receipt of Developer's written approval, City may also utilize additional external consultants, including, but not limited to, attorneys, planning professionals and engineers, as necessary to complete the review. Said consultants will be billed at their agreed upon rates with the City. E. Developer has provided the City the amount of Fifty Thousand Dollars $50,000 to provide initial funding for the Services to be provided by Best Best & Krieger LLP and the City Attorney's Office. This amount shall be applied to pay invoices received from Best Best & Krieger LLP and the City Attorney's Office for their Services. F. City shall provide Developer with a monthly statement of draws against the deposit described in Section 3.E., accompanied by invoices, time records, or other reasonable back-up therefor. None of the back-up documents shall be redacted. City agrees that all reimbursable expenses subject to this Agreement shall be reasonable and customary. G. It is understood and agreed that if any consultant begins Services on the Project prior to execution and delivery of this Agreement by all parties, the fees incurred in connection with the Project prior to such execution and delivery will be subject to reimbursement pursuant to this Agreement upon execution and delivery of this Agreement by all parties and the deposit of funds by Developer pursuant to Section 3.E. 4. Deposit. A. At any time that City determines in good faith that the sums then held in any deposits made pursuant to Sections 3.E above are inadequate to pay for the projected Services to be paid from such deposit over the succeeding two (2) month period, Developer shall replenish the relevant deposit with the amount requested by City in writing, which amount shall not exceed Fifty Thousand Dollars ($50,000) for any particular replenishment, within twenty (20) Business Days of such written request. B. Should any deposit not be replenished within twenty (20) Business Days of Developer's receipt of City's written request, City may direct that all Services to be paid from the deposit applicable to such Services be halted until such time as such applicable deposit is replenished. C. All deposits will be placed in a non -interest bearing trust account. Developer understands and agrees that City will not pay interest to Developer on the deposits, and Developer will not seek interest payments from City. D. No later than forty (40) days after the earliest to occur of: (1) final action is taken by City on the Project, (2) Developer notifies the City in writing of its withdrawal of the Project applications, or (3) the Project is otherwise abandoned by Developer, City will provide Developer with a final accounting of costs and expenses, accompanied by invoices, time records or other reasonable back-up therefor, which accounting the Developer agrees will be conclusive barring errors in the accounting. Should the total reimbursement amount required for any Services be less than the total amount deposited by Developer with respect to such Services, City will refund any remaining deposit amount relating to such Services to Developer within forty-five (45) days after determining the final reimbursement amount for such Services. E. In the event Developer fails or refuses to make any of the deposits required herein, Developer shall be liable to City for the amount of all fees charged to the City for Services actually provided which exceed the amount of the deposit paid by Developer for such Services, and City shall have the right to pursue a breach of contract action, or any other pertinent legal action available to the City, against the Developer. Further, the prevailing party in any dispute and/or litigation necessary to enforce or rt? interpret this Agreement shall be entitled to seek and collect its costs and reasonable attorney's fees from the other party. 5. Other Costs. Developer acknowledges that the cost of the Services does not include all application, permitting, inspection, or other fees which may be charged by City in connection with the Project. To the extent the fees ordinarily charged by City for projects similar to the Project relate to costs that are not reimbursed under this Agreement, such fees shall be separately paid in accordance with the relevant City fee schedule. 6. No Guarantee of Approval. Developer acknowledges that its payments and deposits described herein do not mean that the City will approve the Project nor that City staff will make a recommendation in favor of the Project. Even if the Project is not approved, Developer shall remain liable for all costs for Services actually provided concerning the Project. 7. Independence of Consultants. A. Unless otherwise agreed to in writing by the City, during the Term of this Agreement, Developer will not directly or indirectly enter or propose to enter into any financial or business relationship with any of City's consultants that are working on the Project. B. Developer hereby acknowledges and agrees as follows: i. City has sole discretion to select which of its employees or independent contractors are assigned to work on Developer's application. ii. City has sole discretion to determine which persons' City will hire as consultants to work on Developer's application. iii. As between City and Developer, City has sole discretion to direct the work and evaluate the performance of the consultants whom the City hires to work on Developer's Project and/or application. City retains the right to terminate or replace at any time any consultant who is assigned to work on Developer's Project and/or application. iv. Except as provided in this Agreement, City has sole discretion to determine the amount of compensation paid to consultants hired by City to work on Developer's Project and/or application. V. City, not Developer, shall pay consultants hired or assigned by City to work on Developer's Project and/or application from a City account under the exclusive control of City, which is to be funded by Developer as set forth in this Agreement. vi. Except for those disclosures required by law, including, without limitation, the Public Records Act, all conversations, notes, memoranda, correspondence and other forms of communication by and between the City and its consultants shall be, to the extent permissible by law, privileged and confidential and not subject to disclosure to the Developer. vii. Except for those disclosures required by law, including, without limitation, the Public Records Act, Developer shall have no claim to, nor shall Developer assert any right in any reports, correspondence, plans, maps, drawings, news releases or any and all other documents or work product produced by the consultants. C. City and Developer hereby acknowledge and agree that processing of Developer's application is not contingent on the hiring of any specific consultant. D. City and Developer hereby acknowledge and agree that Developer's duty to reimburse City is not contingent upon the approval or disapproval of the proposed Project, or upon the result of any action of the City. E. Neither Developer nor its officers, employees or agents, shall communicate with the Environmental Consultant, or any of the City's consultants, during the term of this Agreement without prior approval of the City, unless such communication is initiated by the Environmental Consultant, or any of the City's consultants, to obtain information about the Project which is needed to prepare the Environmental Document. 8. Term and Termination. Absent a formal withdrawal of the Project application(s), Developer shall not be entitled to terminate this Agreement. If Developer does formally withdraw the Project application(s), Developer shall remain liable for all costs for the Services incurred through the date of said withdrawal (subject to the terms of the Agreement). The Term of this Agreement shall commence upon the execution and delivery of this Agreement by all parties hereto and shall terminate on the earliest to occur of: (a) the City taking final action on the Project; or (b) Developer formally withdrawing its Project applications. The provisions of Sections 6 through 9 and 11 through 23 (inclusive) shall survive termination of this Agreement. 9. Developer Default. A. Should Developer fail to perform any of its obligations under this Agreement, then City may, at its option, pursue any or all of the remedies available to it under this Agreement, at law or in equity. B. Without limiting any other remedy which may be available to it, if Developer fails to perform any of its obligations under this Agreement, City may cease performing its obligations under this Agreement. C. If any amounts remain owing to City for Services actually performed prior to termination of this Agreement, City may bring an action to recover all costs and expenses incurred by the City in completing such Services, together with interest thereon from the date incurred at the rate of ten percent (10%) per annum, or at the maximum legal rate, whichever is greater. D. City may refuse to take the Project forward for consideration of discretionary actions unless and until all fees are paid. If any amounts remain owing to City pursuant to this Agreement for Services actually performed prior to termination of this Agreement, City may withhold consideration of discretionary actions, permits and/or certificates of occupancy until all such amounts are paid. 10. Indemnification. Developer further agrees that to the fullest extent permitted by law, the Developer shall defend, indemnify, protect, and hold harmless, the City of Santa Ana and its constituent public agency members, officers, employees, volunteers, attorneys, consultants and agents (in the aggregate, the "City Indemnitees") from any and all liability, demand, claim, action, or proceeding, whether actual, alleged, or threatened, including by way of example but not exclusion, proceedings of an administrative or regulatory nature and proceedings that may be associated with alternative dispute resolution (an "Indemnified Claim") brought by third parties against any City Indemnities (including any advisory agency of the City), to attack, set aside, void, annul, or challenge the validity of any approvals granted for the Project, the Environmental Document concerning the Project, or seeking damages which may arise from the Environmental Document concerning the Project, or this Agreement. In any defense of any City Indemnitees, City shall have the absolute right to approve the legal counsel for such City Indemnitees (with the intention of using one law firm to defend all City Indemnitees and Developer unless conflicts of interest preclude such joint representation), and any experts or consultants deemed necessary by City, which approval shall not be unreasonably withheld or delayed. in an exercise of City's sole discretion. City shall work cooperatively with Developer's attorney to avoid duplication of efforts. Developer shall reimburse City for one hundred percent (100%) of the City's actual fees and costs in connection with the Litigation ("Fees and Costs"). Such Fees and Costs shall include, but not be limited to, all reasonable court costs and attorneys' fees, including other City staff time, consultants or experts, spent in regard to defense of an Indemnified Claim. City shall render notice to the Developer of the existence of the Indemnified Claim (a "Notice") and Developer shall reimburse City for one hundred percent (100%) of the City's actual Fees and Costs. City shall cooperate fully with Developer in the defense of any Indemnified Claim. In any Notice, City shall estimate the cost of its defense, which shall include, but not be limited to, actual attorney fees, court costs, expert witnesses and consultant fees, and all other costs that may arise out of, or be incurred by City in the defense of an Indemnified Claim. Upon such Notice, assuming City and Developer have separate counsel, Developer shall promptly deposit funds equal to the first three (3) months of the Estimated Fees and Costs with the City and shall make additional deposits as and when required to fund the further costs of defending the City Indemnitees for such Indemnified Claim. Failure of Developer to deposit such funds shall be deemed a material breach of this Agreement. City shall refund, without interest, any unused portion of the deposits once litigation is finally concluded or a dispute is resolved regarding an Indemnified Claim. Developer's obligation under this Section 10 shall terminate upon the expiration of all statutes of limitation challenging the City's approval of the Project if no litigation is filed concerning the Project's Environmental Document or this agreement. 11. Compliance with Law. Developer will, at its sole cost and expense, comply with all of the requirements of all federal, state, and local laws now in force, or which may hereafter be in force, pertaining to this Agreement. 12. Waiver of Breach. Any express or implied waiver of a breach of any term of this Agreement will not constitute a waiver of any further breach of the same or any other term of this Agreement. 13. Notices. Except as otherwise expressly provided by law, all notices or other communications required or permitted by this Agreement or by law to be served on or given to either party to this Agreement by the other party shall be in writing and will be deemed received on: (i) the day of delivery if delivered by hand, e-mail (with confirmation of receiving party) and fax (both email and fax required for notices delivered by email or fax), or overnight courier service, during regular business hours; or (ii) on the third business day following deposit, with postage prepaid, in the United States Postal Service and addressed to the contracting parties. Name, address, telephone numbers, and e-mail addresses of the Parties are as follows: City: City of Santa Ana Attention: Minh Thai, Planning and Building Agency Executive Director 20 Civic Center Plaza (M-20) Santa Ana, CA 92701 Telephone: (714) 667-2706 Fax: (714) 973-1461 E-mail: MThai@santa-ana.org A Copy to: Sonia Carvalho City Attorney, City of Santa Ana 20 Civic Center Plaza (M-29) Santa Ana, CA 92701 Telephone: (714) 647-5203 Fax: (714) 647-6549 E-mail: SCarvalho@santa-ana.org Developer: South Coast Plaza Attention: Justin McCusker 3315 Fairview Road Costa Mesa, CA 92626 Telephone: (714) 546-0110 Fax: N/A E-mail: McCuskerJ@southcoastplaza.com A Copy to: South Coast Plaza Attention: Jason Poulsen 3315 Fairview Road Costa Mesa, CA 92626 Telephone: (714) 546-0110 Fax: N/A Email: PoulsenJ@southcoastplaza.com Either party may change its address for the purpose of this Section by giving written notice of the change to the other party. 14. Interpretation. This Agreement is deemed to have been prepared by all of the parties hereto, and any uncertainty or ambiguity herein shall not be interpreted against the drafter, but rather, if such ambiguity or uncertainty exists, shall be interpreted according to the applicable rules of interpretation of contracts under the law of the State of California. 15. Business Day. For purposes of this Agreement, "Business Day" means any day other than a Saturday, Sunday, a federal holiday, or a day on which City Hall for the City of Santa Ana is closed for the conduct of regular business. 16. Successors. This Agreement shall be binding on and inure to the benefit of the successors and assigns of the respective parties hereto. However, this Agreement shall not be assigned by Developer in whole or in part without the prior written consent of City. 17. Governing Law. This Agreement has been made in and will be construed in accordance with the laws of the State of California, and exclusive venue for any action involving or arising out of this Agreement will be in Orange County. 18. Attorneys' Fees. If a Party hereto files any action or brings any action or proceeding against another Party arising out of this Agreement, then the prevailing Party shall be entitled to recover as an element of its costs of suit, and not as damages, its reasonable attorneys' fees as fixed by the court, in such action or proceeding or in a separate action or proceeding brought to recover such attorneys' fees. For the purposes hereof the words "reasonable attorneys' fees" mean and include, in the case of the City, salaries (or fees) and expenses of the lawyers employed by the City (allocated on an hourly basis) who may provide legal services in connection with the representation of the City in any such matter. 19. Severability. Should any provision of this Agreement be held by a court of competent jurisdiction to be either invalid or unenforceable, the remaining provisions of this Agreement will remain in effect, unimpaired by the holding. 20. Integration. This instrument constitutes the sole agreement between City and Developer respecting the above matters, and correctly sets forth the obligations of City and Developer. Any Agreements or representations by City to Developer not expressly set forth in this instrument are void. 21. Construction. The language of each part of this Agreement will be construed simply and according to its fair meaning, and this Agreement will never be construed either for or against either party, whether or not that party drafted all or a portion hereof. 22. No Prior Agreements and No Oral Modifications. This Agreement represents the entire understanding of City and Developer with respect to the subject matter hereof and supersedes all other prior or contemporaneous written or oral agreements pertaining to the subject matter of this Agreement. This Agreement may be modified, only in writing signed by the authorized representatives of City and Developer. 23. No Partnership or Joint Entity. This Agreement is not intended to and does not create a partnership or any other form of single or joint entity or any sort comprised of the Parties and/or their attorneys. 24. Authority/Modification. Each party represents and warrants that all necessary action has been taken by such party to authorize the undersigned to execute this Agreement on behalf of such party and to engage in the actions of such party described herein. This Agreement may be modified solely by written amendment signed by both City and Developer. City's City Manager, or designee, may execute any such amendment on behalf of City. 25. Counterparts. This Agreement may be executed in any number of counterparts, each of which will be an original, but all of which together will constitute one instrument executed on the same date. {Signatures on the following page} 9 N-2024-043 IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day and year first hereinabove written. CITY OF SANTA ANA By:G�O homas Hatch Interim City Manager ATTEST: APPROVED AS TO FORM: Sonia R. Carvalho, City Attorney By: J e Montoya Assistant City Attorney DEVELOPER By: South Coast Plaza Name: .Agog Rw&-6Ea Title: -!X 2e-4Esr«F• llve(Wwo-F Date: z� 2 Signature: -^ - 10 EXHIBIT A LEGAL DESCRIPTION THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF SANTA ANA, ON THE COUNTY OF ORANGE, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS: PARCEL A: PARCELS 1 AND 2, IN THE CITY OF SANTA ANA, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS SHOWN ON A MAP MARKED EXHIBIT A, ATTACHED TO LOT LINE ADJUSTMENT NO. LL-81-6, RECORDED JANUARY 2, 1982 AS INSTRUMENT NO 82- 0001483 OFFICIAL RECORDS. IL1Y634q-3 PARCEL 2, IN THE CITY OF SANTA ANA, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP FILED IN BOOK 40, PAGE 43 OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. PARCEL C: PARCEL 2, IN THE CITY OF SANTA ANA, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP FILED IN BOOK 41, PAGE 48 OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. PARCEL D: PARCELS 3 AND 4, IN THE CITY OF SANTA ANA, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP FILED IN BOOK 41, PAGE 48 OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.