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04-062 Bay Area Economics for Professional ServicesAGREEMENT BETWEEN CITY OF CLTPERTINO AND BAY AREA ECONOMICS FUR PROFESSION?.L SERVICES THIS IS AN AGREEMENT MADE p,S OF May 6, 2004, BETWEEN CITY OF CUPERTINO (hereinafter referred to as CIT~i'), and BAY AREA ECONOMICS (hereinafter referred to as Consultant). WITNESSETH: WHEREAS, CITY intends to provide Fiscal ~~nalysis of Potential Height, Setback and Density Initiatives (hereinafter referred to as F'roj ect) and, WHEREAS, CITY requires certain professional fiscal analysis services in connection with Project (hereinafter referred as Services); and WHEREAS, Consultant is qualified and prepared to provide such Services; NOW, THEREFORE, in consideration of the ~~romises contained herein, the parties agree as follows: ARTICLE 1 -SERVICES TO BE PERFORMED BY CONSULTANT 1.1 Specific Services and the associated scope of services, payment, schedule, and personnel will be defined in specific T;~sk Order as mutually agreed by City and Consultant. 1.2 All Task Orders will by reference inco~:porate the terms and conditions on this Agreement, and become formal amendments hereto. ARTICLE 2 -COMPENSATION 2.1 Compensation for Consulting services performed under this Agreement shall be compensated for on a Cost Plus Fixed I~ ee basis. When using this basis of PC/DIR/C ITY/FRM S/A92502 compensation, the City agrees to pay Consultant actual costs incurred, subject to an agreed upon Cost Ceiling, plus a Fired Professional Fee (Fixed Fee). For purposes of this Agreement, the actual costs shall include: Direct Labor Cost Overhead Cost Other Direct Costs (Direct Non-salary Costs) Outside Services Labor rates shall be based on a normal 8-hour day, 40-hour week, with overtime paid for authorized work. Technicians, drafters, and support personnel are paid at one and one-half times their regular rate for overtime. Professional personnel are paid at their regular rate for overtime. Overhead Cost shall be the sum of Fringe Benefits and Indirect Costs. As a portion of the total compensation to be paid to Consultant, City shall pay a Fixed Professional Fee negotiated for each Task Order as profit for services rendered by Consultant covered by this; Agreement and its Task Orders. The Fixed Fee maybe increased for additional authorized services only by subsequent task order or amendment changing the scope of work: Definitions are as follows: a) Direct labor is salaries and wages paid to personnel for time directly chargeable to the project. Direct labor does not include the cost of Consultant's statutory and customary benefits, such as sick leave, holidays, vacations; and medical and retirement benefits nor the cost of the time of executive and administrative personnel and others whose time is not identifiable to the project. b) Fringe benefits include Consultant's statutory and customary benefits, such as sick leave, holidays, vacations, medical and retirement benefits, incentive pay, tuition, and other costs classified as employee benefits. c) Indirect costs are allocations of costs that are not directly chargeable to a specific engagement and are colmmonly referred to as Consultant's overhead. Indirect costs include provisions for such things as clerical support, office space, light and heat, insurance, statutory and customary employee benefits, and the time: of executive and administrative personnel and others whose time is not identifiable to the Fiscal Analysis of Potential Height, Setback and Density Initiatives Project or to any other project. Under no circumstances can the same labor costs be charged as direct labor and also appear at the san;~e time as indirect costs, and visa versa. C:\WINNT\Profiles\colinj\Temporary Internet Files\OLKS\Bay Area Economics.doc 2 d) Other (non-labor) direct costs include such typical expenses as cost of transportation and subsistence, printing and reproduction, computer time and programming costs, identifiable supplies, and charges by reviewing authorities. e) Outside Services shall include .all charges from outside consulting firms or subconsultants. 2.2 Reimbursement for mileage shall not exceed the prevailing Internal Revenue Service's standard mileage rate. 2.3 A Cost Ceiling will be established for each Task Order which is based upon estimated labor-hours and cost estimates. Costs as described above, comprising direct labor, overhead cost, and other direct costs, shall be payable up to a Cost Ceiling as specified in the Task Order. A Maximum Fee Ceiling, or Task Order Firm Ceiling, will also be established ibr each Task Order which includes the Cost Ceiling plus the Fixed Fee. 2.4 Consultant shall invoice City monthly for the actual costs incurred, and a pro- rated portion of the Fixed Fee for work: performed during the previous month. If the Maximum Fee Ceiling is reached,l:he Consultant will complete the agreed- upon work for the Maximum Fee Ceiling. With City staff approval, labor hours may be reallocated within the tasks wi~:hout renegotiation in such a manner so as not to exceed the Maximum Fee Ceiling. 2.5 The Consultant shall provide the City with a review of the budget amounts when 75 percent of the Cost Ceiling for any task has been expended. Consultant may request a revision in the Cost Ceiling fir performance of this Agreement, and will relate the rationale for the revision to the specific basis of estimate as defined in the Scope of Services. Such notification will be submitted to the City at the earliest possible date. The authorized ~~ost Ceiling shall not be exceeded without written approval of the City. 2.6 The fixed professional fee will not be changed except in the case of a written amendment to the Agreement, which alters the Scope of Services. City and Consultant agree to negotiate an increase or decrease in Cost Ceiling and Fixed Fee for any change in Scope of Services required at any time during the term of this Agreement. Consultant will not commence work on the altered Scope of Services until authorized by City. 2.7 Direct labor rates are subject to revision to coincide with Consultant's normal salary review schedule. Adjustments iIl direct labor rates shall not affect the firm ceiling without prior written authorization of the City. 2.8 City shall pay Consultant in accordance; with each Task Order for Services. C:\WINN'T\Profiles\colinj\Temporary Internet Files\OLKS\Bay Area Economics.doc 3 2.9 Consultant shall submit monthly statements for Services rendered. City will make prompt monthly payments in response to Consultant's monthly statements. ARTICLE 3 -PERIOD OF SERVICE 3.1 Consultant's services will be performed and the specified services rendered and deliverables submitted within the time period or by the date stipulated in each Task Order. 3.2 Consultant's services under this Agreemment will be considered complete when the services are rendered and/or final deliverable is submitted and accepted by City. 3.3 If any time period within or date by which any of the Consultant's services are to be completed is exceeded through no fault of Consultant, all rates, measures and amounts of compensation and the time for completion of performance shall be subject to equitable adjustment. ARTICLE 4 -CITY'S RESPONSIBILITIES. City will do the following in a timely manner so as not to delay the services of Consultant. 4.1 Provide all criteria and full information as to City's requirements for the services assignment and designate in writing a person with authority to act on City's behalf on all matters concerning the Consultant's services. 4.2 Furnish to Consultant all existing studies, reports and other available data pertinent to the Consultant's services, obtain or authorize, Consultant to obtain or provide additional reports and data as required, and furnish to Consultant services of others required for the performance of Consultant's services hereunder, and Consultant shall be entitled to use and lrely upon all such information and services provided by City or others in performit>g Consultant's services under this Agreement. 4.3 Arrange for access to and make all pro~~isions for Consultant to enter upon public and private property as required for Consultant to perform services hereunder. 4.4 Perform such other functions as are indicated in each Task Order related to duties of City. 4.5 Bear all costs incident to compliance with the requirements of this Section. C:\WINNT~Profiles\colinj\Temporary Internet Files\OLKS\Bay Area Economics.doc 4 ARTICLE 5 -STANDARD OF CARE 5.1 Consultant shall exercise the same degree of care, skill, and diligence in the performance of the Services as is ordinarily provided by a professional Consultant under similar circumstance and Consultant shall, at no cost to City, re-perform services which fail to satisfy the foregoing standard of care. ARTICLE 6 -OPINIONS OF COST AND St~HEDULE 6.1 Since Consultant has no control over the cost of labor, materials, equipment or services furnished by others, or over contractors', subcontractors', or vendors' methods of determining prices, or over' competitive bidding or market conditions or economic conditions, Consultant's cost estimate and economic analysis shall be made on the basis of qualification and experience as a professional. 6.2 Since Consultant has no control over the resources provided by others to meet contract schedules, Consultant's forecast schedules shall be made on the basis of qualification and experience as a professional. Consultant cannot and does not guarantee that proposals, bids or actual project costs will vary from his cost estimates or that actual schedules will not vary from his forecast schedules. ARTICLE 7 -SUBCONTRACTING 7.1 No subcontract shall be awarded by Consultant until prior written approval is obtained from the City. ARTICLE 8 -CONSULTANT-ASSIGNED PERSONNEL 8.1 Consultant shall designate in writing arl individual to have immediate responsibility for the performance of th.e services and for all matters relating to performance under this Agreement. Ke;y personnel to be assigned by Consultant will be stipulated in each Task Order. Substitution of any assigned person shall require the prior written approval of the; City, which shall not be unreasonably withheld. If the City determines that a proposed substitution is not responsible or qualified to perform the services then, Ott the request of the City, Consultant shall substitute a qualified and responsible person. ARTICLE 9 -OWNERSHIP OF DOCUMENTS 9.1 All work products, drawings, data, repc-rts, files, estimate and other such information and materials (except proprietary computer programs, including source codes purchased or developed with Consultant monies) as maybe C:\W[NN71Profiles\colinj\Temporary Internet Files\OLKS\Bay Area Economics.doc 5 accumulated by Consultant to complete services under this Agreement shall be owned by the City. 9.2 Consultant shall retain custody of all project data and documents other than deliverables specified in each Task Or~3er, but shall make access thereto available to the City at all reasonable times the (:ity may request. City may make and retain copies for information and reference. 9.3 All deliverables and other information prepared by Consultant pursuant to this Agreement are instruments of service in respect to this project. They are not intended or represented to be suitable for reuse by City or others on extensions of this Project or on any other project. Al~y reuse without written verification or adaptation by Engineer for the specific purpose intended will be at City's sole risk and without liability or legal exposure to Consultant; and City shall indemnify and hold harmless Consultant against all claims, damages, losses, and expenses. including attorney's fees arising out of or resulting from such reuse. Any such verification or adaptation will entitle Consultant to further compensation at rates to be agreed upon by City and Consult;~nt. ARTICLE 10 -RECORDS OF LABOR AND COSTS 10.1 Consultant shall maintain for all Task Orders, records of labor and costs used in claims for compensation under this Agreement. Records shall mean a contemporaneous record of time for personnel; a methodology and calculation of the Multiplier for fringe benefits and ir.~direct costs; and invoices, time sheets, or other factors used as a basis for determining other nonlabor Project charges. These records must be made available ~to the City upon reasonable notice of no more than 48 hours during the period of the performance of this Agreement. 10.2 After delivery of Services (completion of Task Orders) under this Agreement, the Consultant's records of all costs used in claim's for compensation under this Agreement shall be available to City's ~l<ccountants and auditors for inspection and verification. These records will be maintained by Consultant and made reasonably accessible to the City for a period of three (3) years after completion of Task Orders under this Agreement. 10.3 Consultant agrees to cooperate and provide any and all information concerning the Project costs which are a factor in determining compensation under this Agreement as requested by the City or any public agency which has any part in providing financing for, or authority over, the Services which are provided under the Agreement. 10.4 Failure to provide documentation or substantiation of all Project costs used as a factor in compensation paid under Article 2 hereof will be grounds for City to refuse payment of any statement submitted by the Consultant and for a back charge for any City funds, including interest from payment; or grant, matching or C:\WINNT\Profiles\colinj\Temporary Internet Files\OLKS\Bay Area Economics.doc 6 other funds from agencies assisting City in financing the Services specified in this Agreement. ARTICLE II -INSURANCE Consultant shall provide and maintain at all times during the performance of the Agreement the following insurances: 11.1 Workers' Compensation and Employer's Liability Insurance. Consultant agrees to carry Workers' Compensation and Employer's Liability Insurance for protection of Consultant's employees as required bylaw and as will protect Consultant from loss or damage because of personal injuries, including death, to any of his employees. 11.2 Comprehensive Automobile LiabilitYl:nsurance. Consultant agrees to carry a Comprehensive Automobile Liability Policy providing bodily injury liability. This policy shall protect Consultant against all liability arising out of the use of owned or leased automobiles both passenger <<nd commercial. Automobiles, trucks, and other vehicles and equipment (owned, not owned, or hired, licensed or unlicensed for road use) shall be covered under this policy. Limits of liability for Comprehensive Automobile Liability Insurance shall not be less than $1,000,000 Combined Single Limit. 11.3 Comprehensive General Liability. Insurance as will .protect Consultant and City from any and all claims for damages or personal injuries, including death, which maybe suffered by persons, or i:or damages to or destruction to the property of others, which may arise frc-m the Consultant's operations under this Agreement, which insurance shall name the City as additional insured. Said insurance shall provide a minimum of $1,000,000 Combined Single Limit coverage for personal injury, bodily in-jury, and property damage for each occurrence arid aggregate. Such insur:llnce will insure Consultant and City from any and all claims arising from the following: 1. Personal injury; 2. Bodily injury; 3. Property damage; 4. Broad form property damage; 5. Independent contractors; 6. Blanket contractual liability. 11.4 hall maintain a policy of professional liability insurance r against claims arising o ~~,, p~aanntt , or omissions of Consultant pursuant to ent, in an~ ess than $1,000,000. The said s all cover the indemnity provisions under this ent. C:\W INNT\Profiles\colinj\Temporary Internet Files\OLKS\Bay Area Economics.doc 7 11.5 Consultant agrees to maintain such insurance at Consultant's expense in full force and effect in a company or companies satisfactory to the City. All coverage shall remain in effect until completion of the Project. 11.6 Consultant will furnish the City with certificates of insurance issued by Consultant's insurance carrier and cowltersigned by an authorized agent or representative of the insurance compa~iy. The certificates shall show that the insurance will not be cancelled, altered, or reduced without at least thirty (30) days prior written notice to the City. 7,he certificates for liability insurance will show that liability assumed under this Agreement is included. ARTICLE 12 -LIABILITY AND INDEMNIFICATION 12.1 Having considered the risks and potential liabilities that may exist during the performance of the Services; and in consideration of the promises included herein, City and Consultant agree to allocate such liabilities in accordance with this Article 12. Words and phrases used in this Article shall be interpreted in accordance with customary insurance industry usage and practice. 12.2 Consultant shall indemnify and save h~~rmless and defend the City and all of their agents, officers, and employees from and against all claims, demand, or cause of action of every name and nature arisin;; out of negligent error, omission, or act of Consultant, its agents, servants, or emIloyees in the performance of its services under this Agreement. 12.3 In the event an action for damages is filed in which negligence is alleged on the part of City and Consultant, Consultant agrees to defend City. In the event City accepts Consultant's defense, City agrees to indemnify and reimburse Consultant on a pro rata basis for all expenses of defense and any judgment or amount paid by Consultant in resolution of such claim. Such pro rata share shall be based upon a final judicial determination of negligence or, in the absence of such determination, by mutual agreement. 12.4 Consultant shall indemnify City against legal liability for damages arising out of claims by Consultant's employees. City shall indemnify Consultant against legal liability for damages arising out of claims by City's employees. 12.5 Indemnity provisions will be incorporated into all Project contractual arrangements entered into by City and will protect City and Consultant to the same extent. 12.6 Upon completion of all services, oblig~~tions and duties provided for in the Agreement, or in the event of termination of this Agreement for any reason, the terms and conditions of this Article shall survive. C:\WINNT\Profiles\colinj\Temporary Internet Files\OLKS\Bay Area Economics.doc g 12.7 To the maximum extent permitted bylaw, Consultant's liability for City's damage will not exceed the aggregate compen~;ation received by Consultant under this Agreement or the maximum amount of professional liability insurance required by this Agreement, which ever is greater. ARTICLE 13 -INDEPENDENT CONTRACTOR Consultant undertakes performance of the Services as an independent contractor and shall be wholly responsible for the methods of perfi~rmance. City will have no right to supervise the methods used, but City will havt; right to observe such performance. Consultant shall work closely with City in performing Services under this Agreement. ARTICLE 14 -COMPLIANCE WITH LAW S In performance of the Services, Consultant will comply with applicable regulatory requirements including federal, state, and local laws, rules, regulations, orders, codes, criteria and standards. Consultant shall procure the permits, certificates, and licenses necessary to allow Consultant to provide Fisc~Il Analysis of Potential Height, Setback and Density Initiatives. Consultant shall not be re;~ponsible for procuring permits, certificates, and licenses required for any construction unless such responsibilities are specifically assigned to Consultant in Task Order. ARTICLE 15 -NONDISCLOSURE OF PROPRIETARY INFORMATION Consultant shall consider all information provided by City and all drawings, reports, studies, design calculations, specifications, anti other documents resulting from the Consultant's performance of the Services to be: proprietary unless such information is available from public sources. Consultant shall not publish or disclose proprietary information for any purpose other than the performance of the Services without the prior Written authorization of City or in response to legal process. ARTICLE 1.6 -TERMINATION OF CONTRACT 16.1 The obligation to continue Services under this Agreement may be terminated by either party upon seven days written notice in the event of substantial failure by the other party to perform in accordance with the terms hereof through no fault of the terminating party. 16.2 City shall have the right to terminate this Agreement or suspend performance thereof for City's convenience upon written notice to Consultant, and Consultant shall terminate or suspend performance: of Services on a schedule acceptable to City. In the event of termination of suspension for City's convenience, City will pay Consultant for all services performed and costs incurred including termination or suspension expenses. Upon restart of a suspended project, equitable adjustment shall be made to Consultant's compensation. C:\W INNT\Profiles\colinj\Temporary Internet Files\OLKS\Bay Area Economics.doc 9 ARTICLE 17 -UNCONTROLLABLE FORCES 17.1 Neither City nor Consultant shall be considered to be in default of this Agreement if delays in or failure of performance shall be due to uncontrollable forces, the effect of which, by the exercise of reasonable diligence, the nonperforming party could not avoid. The term "uncontrollable forces" shall mean any event that results in the prevention or delay of performance by a party of its obligations under this Agreement and which is beyond the control of the nonperforming party. It includes, but is not limited to, fire, flood, earthquake, storms, lightening, epidemic, war, riot., civil disturbance, sabotage, inability to procure permits, licenses, or authorizations from any state, local, or federal agency or person for any of the supplies, materials, accesses, or services required to be provided by either City or Consultant under this Agreement, strikes, work slowdowns or other labor disturbances, and judicial restraint. 17.2 Neither party shall, however, be excused from performance if nonperformance is due to uncontrollable forces which are removable or remediable, and which the nonperforming party could have, with the exercise of reasonable diligence, removed or remedied with reasonable ~3ispatch. The provisions of this Article shall not be interpreted or construed to require Consultant or City to prevent, settle, or otherwise avoid a strike, wort: slowdown, or other labor action. The nonperforming party shall, within a re~lsonable time of being prevented or delayed from performance by an uncontrollable: force, give written notice to the other party describing the circumstances and uncontrollable forces preventing continued performance of the obligations of this ,agreement. The Consultant will be allowed reasonable negotiated extension of time or adjustments for City initiated temporary stoppage of services. ARTICLE 18 -MISCELLANEOUS 18.1 A waiver by either City or Consultant of any breach of this Agreement shall not be binding upon the waiving party unless such waiver is in writing. In the event of a written waiver, such a waiver shall not affect the waiving party's rights with respect to any other or further breach. 18.2 The invalidity, illegality, or unenforceability of any provision of this Agreement, or the occurrence of any event rendering any portion or provision of this Agreement void, shall in no way effect the validity or enforceability of any other portion or provision of the Agreement. Any void provision shall be deemed severed from the Agreement and the balance of the Agreement shall be construed and enforced as if the Agreement did n~~t contain the particular portion or provision held to be void. C:\WINNT1Profiles\colinj\Temporary Internet Files\OLKS\Bay Area 13conomics.doc 1 ARTICLE 19 -INTEGRATION AND MOD]FICATION 19.1 This Agreement (consisting of pages 1 to 14), together with all exhibits executed by the undersigned, is adopted by City and Consultant as a complete and exclusive statement of the terms of the Agreement between City and Consultant. This Agreement supersedes all prior a~~eements, contracts, proposals, representations, negotiations, letters, or other communications between the City and Consultant pertaining to the Services, whether written or oral. 19.2 The Agreement may not be modified Unless such modifications are evidenced in writing signed by both City and Consultant. ARTICLE 20-SUCCESSORS AND ASSIGNS 20.1 City and Consultant each binds itself and its directors, officers, partners, successors, executors, administrators; ;assigns and legal representatives to the other party to this Agreement and to the partners, successors, executors, administrators, assigns, and legal representatives of such other party, in respect to all covenants, agreements, and obligations of this Agreement. 20.2 Neither City nor Consultant shall assign, sublet, or transfer any rights under or interest in (including, but without limitation, monies that may become due or monies that are due) this Agreement without the written consent of the other, except to the extent that the effect of this limitation may be restricted by law. Unless specifically stated to the contraary in any written consentto an assignment, no assignment will release or dischargt; the assignor from any duty or responsibility under this Agreement. clothing contained in this paragraph shall prevent Consultant from employing su~~h independent consultants, associates, and subcontractors as he may deem appropriate to assist him/her in the performance of the Services hereunder and in accordance with Article 7. 20.3 Nothing herein shall be construed to give any rights or benefits to anyone other than City and Consultant. C:\WINNT1Profiles\colinj\Temporary Internet Files\OLKS\Bay Area Economics.doc 11 ARTICLE 21-EXECUTION IN WITNESS THEREOF, the parties hereto nave made and executed this Agreement as of the day and year first above written. CITY OF CUPERTINO By Colin Jung enior anner ~ Zi ~ Date: CHARLES T. KILIAN LEGAL COUNSEL By: Legal Counsel I lJ~-,!r.~s-~ ,-~~e~t. ~~ r'~t ~ w4,rf ~ ` ~ . BAY AREA ECONOMICS (CONSULTANT) By: _ ~ r'- Janet Smith-Heimer Title: Managin>; Principal Date: C:\WINNT\Profiles\colinj\Temporary [ntemet Files\OLKS\Bay Area Economics.doc 12 TASK ORDER NO. 1 to AGREEMENT BETWEEN CITY OF C>`TPERTINO AND BAY AREA ECONOMICS FOlZ PROFESSIONAL SERVICES Dated Ma~Y 6, 2004 I. PURPOSE The consultant shall provide Fiscal Analysis of Potential Height, Setback and Density Initiatives on behalf of the cit}~ of Cupertino for submission to the Cupertino City Council according to trle attached Schedule for Inititiative Report Preparation (Exhibit B). 2. PROJECT COORDINATION Project shall be coordinated with Colin Jung, Senior Planner, in the Community Development Department. Consultant may need to coordinate work with other City staff and the City's housing and legal consultants as directed. 3. SCOPE OF SERVICES Attached Proposal for Fiscal Analysis ~of Potential Height, Setback and Density Initiatives, Exhibit A, is hereby incorp~~rated as part of this agreement. 4. COST CEILING FOR DIRECT COSTS The cost ceiling for the analysis of the potential height, density, and setback initiatives shall be set at $48,000. This. fee shall include the preparation of the written analysis, consultation with Cit}~ staff, City's housing and legal consultants, review of background material, mapping of affected parcels, analysis of fiscal impact on school districts, analysis of fiscal impact on City of Cupertino, preparation of final report and attendance at three to four meetings. IN WITNESS WHEREOF, the parties hereto ]lave made and executed this Task C:\WINNT\Profiles\colinj\Temporary Internet Files\OLKS\Bay Area Economics.doc 13 Order No. One 1 as of May 6, 2004 and theY•ewith incorporate it as part of the Agreement. CITY City of Cupertino ~~u lip---- By: Colin Jung, e for P er CONSULTANT Bay Area Economics Janet Smith-Heimer Title: Managing Principal C:\WINNTU'rofiles\colinj\Temporary Internet Files\OLKS\Bay Area Economics.doc 14 EXHIBIT A Initiative Report Scope of Work Fiscal Analysis The City requests an impartial and objective report that analyzes three proposed initiatives, which would through the City's Gc;neral Plan restrict building heights, building setback lines and residential density 1:hroughout Cupertino (See attachments A, B, & C). The report shall examine and evaluate the fiscal effects of the proposed initiatives on the City and its elementary and High school districts: Cupertino Union School District (elementary and middle schools) and Fremont Union High School District. Fiscal Effects on School Districts The report shall analyze the costs incurred and the revenues earned (both one-time and ongoing costs and revenues) by the two aforementioned school districts for new residential developments with a density of 15 dwellings or less per net acre, and residential developments with a density of 16 or more dwellings per net acre, up to the limit allowed by the current General Plan. Co::t estimates shall include infrastructure costs and ongoing costs to serve anticipated student population. Comparable cost/revenue data shall be determine for new commercial and office/industrial developments. Part of this analysis will look at the estimated number of elementary, middle and high school students generated by new residential developments in order to calculate school costs. Elementary, middle and high school student numbers must be calculated for new residential developments with a density of 15 dwellings or less per net acre, and new residential projects with 16 or more dwellings per net acre. While the report should use student generation factors utilized by the individual school districts, the study shall validate the forecasts by using other data sources, such as census data, occupancy data from property owners, developer information ;and/or actual surveys of residents. If there are significant discrepancies between the forecasts and actual attendance figures, the report shall offer explanations. If there are significant negative fiscal effects on the school district(s), the report shall suggest a range of alternative measures that cam be implemented by the City or the school districts to address the fiscal effects. Fiscal Effects on the City The Fiscal Report shall contain the following elements: 1) A map of the parcels in the City that v~~ould be directly affected by the three initiatives; 2) Specific fiscal analyses on 6 prototypical sites within the City, reporting on potential revenues and costs that would be incurred by the City and its Redevelopment Agency for alternative; hypothetical developments that would be allowed by the existing general plan aald zoning regulations and what would be allowed under the initiatives; 3) A survey of professionals familiar with local land use and economic development trends to identify project types/busine::ses that would be attracted and discouraged from locating in Cupertino because of the restrictions in the initiatives, including the reasons why they would be attracted or discouraged; 4) Identification of any properties, if any. that would be potentially denied a reasonable use of their land, where potential inverse condemnation claims may arise and the resultant potential fiscal impact on the City; 5) Assessment of the impact on property values for properties affected by the initiatives; 6) Identification of the measures the City must take to comply with the initiatives if they become law. If there are alternatives to the identified measures, they should also be identified. Separate reports on the legal and housing implications of the initiatives are being prepared under separate contracts. The Contr~ictor for the fiscal analysis shall work cooperatively with the other selected consulta~lts in order to integrate the housing, legal and fiscal analyses as much as possible. EXHIBIT B 2004 Schedule for Initiative Report Preparation Date Task April 16t" Director Approves Draft Scope of Work April 19t" - 30t" Scope of Work refined, contract amount established, contract awarded. May 6t" Contract Signed May 6'" -June 6t" Initiative Report Preparation June 7t" Draft Reports Delivered to Staff June 14t" Staff Comments :Due back to Consultants June 28t" Final Initiative Reports Delivered to City June 30'" Deadline for City Council Packet July 6'" City Council Mef;ting on Initiative Report B~, Area Economics Apri128, 2004 Colin Jung City of Cupertino Planning Division 10300 Torre Avenue Cupertino, CA 95014-3202 Dear Mr. Jung, EXHIBIT C This letter presents a scope of services in response to the City's request to conduct a fiscal impact analysis on three proposed ballot initiatives. These initiatives would amend the City's General Plan to restrict building heights to 36 feet, establish a minimum building set back of 35 feet, and require that all mixed-use projects have a maximum density of 15 dwelling units per net acre. The City seeks to understand the fiscal impacts of these initiatives on the Cupertino General Fund and the local school districts, and what steps the City would need to take to comply with the initiatives if they were passed. City staff and Council will use the results of this analysis will in planning their strategic response to each initiative:. Proposed Scope Task 1: Start-Up Meeting and Review of Background Material BAE will meet with City of Cupertino staff to understand the project context, acquire relevant background materials, and finalize the scope of v~~ork. Following the meeting, BAE will tour the City and surrounding neighborhoods. BAE will :hen review background materials associated with the proposed initiatives, including the City':. General Plan and Housing Element. BAE will also contact Goldfarb and Lipman and Melanie Freitas to understand their scopes of work and how our tasks might inform one another. Task 2: Map Affected Parcels Using GIS software, BAE will map the parcels iri the City that would be directly affected by the three proposed initiatives. In order to expedite this task under the short time frame, BAE will need to obtain parcel layers and any available geocoded data (e.g., General Plan designations) from the City's Planning Division. If these items are not available, the timeframe and budget shown in this proposal will be modified accordingly to reflect additional work needed to create data layers and geocode necessary information. Task 3: Fiscal Impact Analysis on Local School' Districts BAE will analyze the potential fiscal impact of tl~e maximum density measure on the Cupertino Union School District and Fremont Union High School District. This task contains three main steps. First, BAE will compare the student generation rites for projects up to 15 units per net acre and projects with more than 15 units per net acre. B~`-E will cross-reference a variety of data sources to determine fair and accurate student generation rates for both scenarios. These data sources include standard factors used by local school districts, interviews with developers and property Headquarters 510.549.7310 2560 9th Street, Suite 211 fax 510.549.7028 Berkeley, CA 94710 bael@bael.com bayareaeconomics.com ~, Bay'Area'~co~~omics EXHIBIT C managers of sample projects in the area, and PUIvIS data from the 1990 and 2000 Census. PIJMS is the unpublished raw data from a five percent s;nnple of long-form Census responses, and allows for detailed analysis ofcross-tabulated information such as number of school age children per household tabulated by type of dwelling unit. Next, BAE will reference the maps produced in ']Cask 2 and the City's General Plan to determine how many units in Cupertino would be produced under each scenario, and the resulting number of students. Finally, BAE will contact and collaborate with th.e local districts to assess the one-time and ongoing costs and revenues generated by additiolal students under each scenario. Task 4: Fiscal Impact Analysis on City of Cupe~7ino General Fund This task contains three subtasks which examine various ways in which the three proposed initiatives might affect Cupertino's fiscal and economic vitality. Subtask 1: Fiscal Analysis of Prototype Sites. BAE will analyze up to six prototypical sites within the City, comparing how alternative developments under the existing General Plan and the proposed initiatives would generate revenues and costs for the City General Fund. Revenue items include additional sales tax, property tax, property transfer tax, transient occupancy tax (for any lodging uses), business license revenue, franchise fees, and any other applicable taxes. Cost items include police, fire, public works, recreation and library services, and general government services. BAE will work with City staff to identify appropriate sites that vary according to location, potential uses, and zoning regulations. Subtask 2: Property Value Analysis. I:tAE will conduct land residual analyses on each of the six prototype sites to assess how th.e proposed initiatives, in comparison with current General Plan and zoning regulations, would impact local property values. Aland residual value analysis estimates the potential value of a specific parcel given local land use and zoning regulations, resulting development potential, likely rents and/or sale prices from new development, and the costs to create the project. In addition, BAE will use First American Real Estate Solutions (FARES) to research any recent land sales in the area and examine how land use regul~ltions have influenced land value trends. As part of this task, BAE will also identify any properties that would be denied a reasonable use of their land, leading to a :possible takings claim. The completion of the this step will hinge on an analysis by Goldfarb and Lipman on the land use, zoning, or entitlement conditions that could lead to ;such a claim. If relevant, Goldfarb and Lipman will also suggest a legally appropriate methodology for calculating the lost value of the property and the owner's potential claim. Following Goldfarb and Lipman's analysis, BAE would identify areas or specific properties where these conditions occur, and estimate the potential cost that the City m.ay incur as a result of the proposed initiatives. Subtask 3: Key Informant Interviews. BAE will interview up to eight members of the development and business community, including local real estate brokers, developers, Headquarters 510.549.7310 2560 9th Street, Suite 211 fax 510.549.7028 Berkeley, CA 94710 bae1(~bael.com bayareaeconomics.com EXHIBIT C Bay Arag I=COnDm9C5 property owners, and growing and established business owners to qualitatively assess the impact of the three proposed initiatives an local economic development. The interviews would include a discussion of how the initiatives may encourage or discourage business attraction and growth. BAE will work with City staff to assemble a diverse set of stakeholders with various perspectives o~1 the issue. Task S: Fiscal Impact Analysis Memorandum BAE will summarize the methodology and findings of Tasks 2 through 4 in an Administrative Draft memorandum to be submitted to City staff. The memorandum will also describe the measures that the City must take to comply with the initiatives should they pass. Following staff's review of the Administrative Draft, BAE will incorporate any comments and prepare a Final Draft Memorandum. Task 6: Presentation to City Council BAE will present the main findings of the Fiscal Impact Analysis to the Cupertino City Council via a PowerPoint slideshow. Proposed Schedule Assuming contract authorization by May 1, BAE will complete Tasks. l through 4 of the scope and submit an Administrative Draft of the Memorandum by June 7, 2004. A Final Draft of the Memorandum will be delivered by June 28. The timing of Task 6 will occur at the City's request. Proposed Budget BAE will perform the above scope of work on a fixed fee basis not to exceed $48,000, according to the following budget: Task Budget Task 1: Start-Up Meeting and Review of Background Material $2,000 Task 2: Map Affected Parcels $5,000 Task 3: Fiscal Impact Analysis on Local School Districts $10,000 Task 4: Fiscal Impact Analysis on City of Cupertino $20,000 Task 5: Fiscal Impact Analysis Memorandum $5,000 Task 6: Presentation to City Council $5,000 Subtotal Labor $47, 000 Data Expenses up to $1, 000 Total $48,000 Headquarters 2560 9th Street, Suite 211 Berkeley, CA 94710 510.549.7310 fax 510.549.7028 bael(v~baet . com bayareaeconomics.com EXHIBIT C Ba, Area Economics For 2004, BAE's hourly professional rates are as follows (to be applied to any meetings or tasks not specified in this proposal): Principal $200/hr Vice President $175/hr Senior Associate $150/hr Associate $100/hr Analyst $70/~ All work authorized by this proposal will be invoiced on the first day of each month, for the duration of the contract. All invoices are due anti payable within 30 days of receipt by the City of Cupertino. If you wish to authorize the above sa~pe please sign a copy of this letter and fax it to the number below. Thank you for thinking of BAE in distributing the RFP. We look forward to working with you on this important project. Sincerely, Janet Smith-Heimer Managing Principal Colin Jung :Date City of Cupertino Headquarters 510.549.7310 2560 9th Street, Suite 211 fax 510.549.7028 Berkeley, CA 94710 bael@bael.com bayareaeconomics.tom ACORD„ CERTIFICATE OF LIABILITY INSURANCE CSR EW DATE (MM/DD/YYYY) BAYAR-5 06/07/04 PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION R. L. Milsner, Inc. ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE CA License #0557311 HOLDER. THIS CERTIFICATE DOES NOT AMEND, EXTEND OR P . O. Box 8197 ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. 'Walnut Creek CA 94596 Phone:925-932-0424 Fax:925-932-2317 INSURED Bayy Area Economics 25b0 Ninth Street, Suite 211 Berkeley CA 94710 INSURERS AFFORDING COVERAGE I NAIC # INSURERA Hartford Insurance Co 22357 INSURER B INSURER C: INSURER D: I - - INSURER E: I COVERAGES THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT. TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAYBE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT --0 ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. AGGREGATE LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. INSR ~ADD'C T POLICY EFFECTIVE POLICY EXPIRATION LTR INSRD TYPE OF INSURANCE POLICY NUMBER DATE MM/DDIYY DATE MM/DD/YY LIMITS ~' .GENERAL LIABILITY EACH OCCURRENCE $ 1 , OOO , OOO A '. X ~I X COMMERCIAL GENERALLIABILITY i 57 SBA GL2374 :LO/03/03 10/03/04 PREMISES (Eaoccurence) $ 300,000 ' ', ~~ _' CLAIMS MADE I, ~ OCCUR MED EXP (Any one person) $ 10 , 000 ', ----- -.. __-- PERSONAL & ADV INJURY $ 1 , OOO , OOO '--1 1 - - - GENERAL AGGREGATE $ 2 , OOO , OOO I GEN'L AGGREGATE LIMIT APPLIES PER: -- PRODUCTS -COMP/OP AGG $ 2 , OOO , OOO ~ PRO- ~ ! LOC POLICY X JECT AUTOMOBILE LIABILITY ~ I COMBINED SINGLE LIMIT (Ea accident) $ 1 ~~~ 000 i X ANYAUTO A -- 57 UEC TL1438 j :L2/24/03 12/24/04 j ''~ '. ALL OWNED AUTOS 'I ~ I BODILY INJURY $ ~, ~ ~ SCHEDULED AUTOS _i '~. (Per person) ' ~ ' HIRED AUTOS i I, j BODILY INJURY $ '. ~I NON-OWNED AUTOS I, (Per accident) ' _ __ PROPERTY DAMAGE $ (Per accident) ~' 'GARAGE LIABILITY AUTO ONLY - EA ACCIDENT $ I '~~ ANY AUTO OTHER THAN EA ACC $ AUTO ONLY: AGG $ it ~I EXCESS/UMBRELLA LIABILITY EACH OCCURRENCE $ I ' OCCUR ~ ~ CLAIMS MADE AGGREGATE $ DEDUCTIBLE $ ~I ~ RETENTION $ i ' $ ~'i WORKERS COMPENSATION AND TORY LIMITS ER EMPLOYERS' LIABILITY I ANY PROPRIETOR/PARTNER/EXECUTIVE ~ E.L. EACH ACCIDENT $ ' OFFICER/MEMBER EXCLUDED? E.L. DISEASE - EA EMPLOYEE $ I If yes, describe under '~ SPECIAL PROVISIONS below E.L. DISEASE -POLICY LIMIT $ OTHER DESCRIPTION OF OPERATIONS /LOCATIONS /VEHICLES /EXCLUSIONS ADDED BY ENDORSEMENT /SPECIAL PROVISIONS The City of Cupertino, and all their Agents, Officers and Employees are named as Additional Insureds as respects the operations of the Named Insured *Except 10 Days Notice For Non-Payment CERTIFICATE HOLDER CANCELLATION C I TYCUP SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATIO DATE THEREOF, THE ISSUING INSURER WILL ENDEAVOR TO MAIL * 3O DAYS WRITTEN City Of Cupertino NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE LEFT, BUT FAILURE TO DO SO SHALL Attn : Colin Jung IMPOSE NO OBLIGATION OR LIABILITY OF ANY KIND UPON THE INSURER, ITS AGENTS OR 10300 Torre Avenue Cupertino CA 95014 REPRESENTATIVES. AUTHORIZED REPRESENTATIVE /~ R.L. Milsner Inc. /1 '~ 1.~~/ ~ ACORD 25 (2001/08) ©ACORD CORPORATION 19S