HomeMy WebLinkAbout05/19/1992, C-7 - DALIDIO PROPERTY LAND VALUE ANALYSIS iIIIIIAIR�I�IIII�n�I�II�IU MEETING DATE:
II II ��u►uil cityof san L-.Is oBIspo
COUNCIL AGENDA REPORT ' NUMBER rJ
FROM: Ken Hampian, Assistant City Administrative Officer'
SUBJECT: Dalidio Property Land Value Analysis
CAO RECOMMENDATION: Approve and authorize the Mayor to execute an
agreement in the amount of $16,900 with Economic Research
Associates to complete a land value analysis of the proposal for
the Dalidio property.
DISCUSSION:
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Last November, Merriam Planning Associate's, representing the
Dalidio family, presented a proposal to the City Council for the
117 acre Dalidio property. The proposal would designate portions
of the land for commercial development (40 acres) , residential
development (12 acres) , and the preservation of open space (65
acres) . The open space preservation was proposed to be achieved
through a City purchase in the amount of $85, 000 per acre, or
nearly about $5. 5 million for the full 65 acres. The Council
received the presentation and conceptually endorsed the following:
The preservation of substantial open space on the Dalidio
property (about 65 acres) .
Commercial land uses adjacent to the Central Coast Mall
(40 acres) and some residential uses along Madonna Road
(12 acres) for inclusion in the Land Use Element and LUE
map.
Open space acquisition through purchase, with the amount,
timing, and funding source to be negotiated.
The Council's conceptual endorsement was in no way to be considered
a final agreement, but instead was to serve as direction to staff
in the further evaluation of the proposal.
Preliminary Issues Identified by Staff
A staff team including the CAO, Assistant CAO, City Attorney,
Community Development Director, and Finance Director met several
times following the November Council meeting to .identify both the
key issues associated with the proposal and a strategy for
proceeding. Several issues were identified as needing further
definition and consideration, including:
Establishing a "fair" acquisition cost, given the value
conferred to the property owner via annexation and
changing portions of the land use to commercial and
residential designations.
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COUNCIL AGENDA REPORT
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Dalidio Report
- The potential cost of acquisition versus the potential
benefit to the City.
- The timing and source of payment.
- The precedent this form of acquisition may establish
relative to the overall Open Space Program.
- The best process for keeping the City's regulatory role
separate from its proprietary interest in the open space.
Land Value Analysis
Given the issues involved, and the potentially high cost of the
project to the City, in February staff recommended to the Council
that the City complete a thorough land value analysis prior to
entering into formal negotiations for the open space acquisition.
This was recommended because there are a number of ways of
establishing value and approaching a negotiated purchase of this
kind. For example, the property owner has suggested $85,000 per
acre for the open space area. This equates to approximately $5. 5
million ($85K X 65 acres) . The basis of the owners valuation has
not been extensively analyzed, but is said by them to reflect an
"appraisal of residential land valued in its unannexed form" .
Other ways of arriving at an appropriate value which should .be
considered are:
its value as low density residential property (current
County zoning) less a "credit" for value conferred by the
40 acre commercial designation.
its value solely as agricultural land, since this is how
the City will use it (income valuation method) .
There are other valuation concepts which may be developed in
consultation with experts in these types of negotiations.
The Council concurred with the need for further land value
analysis, and directed staff to solicit a proposal from Economic
Research Associates (ERA) . ERA was selected because of their role
as the City's financial analyst for the overall open space program.
ERA's proposal is provided as a part of the attached agreement.
The proposal outlines in some detail the variety of tasks to be
completed as a part of the land value analysis. Staff would like
to point out that task #7 ("assistance in negotiations") is not
included in the recommended workscope to be included in this
contract.
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SCOUNCIL AGENDA REPORT
Page 3
Dalidio Report
However, assuming that the Council wishes to proceed with
negotiations following completion of the land value analysis, such
assistance is likely to be eventually necessary. Again, this is
a potentially costly and complex transaction, and the City should
bring proper resources to bear upon any negotiated acquisition
agreement.
CONCURRENCE:
The proposal has been reviewed by several staff members, including
the City Attorney, Community ' Development Director, Finance
Director, and Open Space Planner, and staff feels it represents the
level of analysis which needs to be completed before entering into
negotiations with the property owner.
FISCAL IMPACT:
Given the project's relationship to a potential expansion of
commercial uses adjacent to the Central Coast Mall, staff believes
that funds already budgeted in the Economic Stability Program
should be used to support the land value analysis (page D-93 , 1991-
93 Financial Plan) . The Economic Stability Program has a current
balance of $50,700 (account no. 001-1028-008-119) .
ALTERNATIVE:
The Council could direct staff to enter into negotiations without
the completion of a land value analysis. However, given the amount
of City funds potentially involved in this transaction, staff feels
that it would not be prudent to do so. It is expected that the
benefits that will ultimately result through the availability of
comprehensive land value data will far exceed the cost of this
contract.
ATTACHMENT:
Agreement and Scope of Work
kh\dalidio.rpt
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PROFESSIONAL SERVICES AGREEMENT WITH
ECONOMIC RESEARCH ASSOCIATES TO COMPLETE A
LAND VALUE ANALYSIS OF THE PROPOSAL FOR THE DALIDIO PROPERTY
This agreement, made this _ day of , 1992 by and between the CITY
OF SAN LUIS OBISPO, California (hereinafter referred to as "City"), and ECONOMIC
RESEARCH ASSOCIATES (hereinafter referred to as "Contractor").
WITNESSETH:
Whereas, the City Council received a presentation and conceptually endorsed a proposal
from representatives of the Dalidio family (Merriam Planning Associates) last November;
and
Whereas, the City desires a complete land value analysis prior to entering into formal
negotiations for open space acquisition; and
Whereas, the Contractor is currently the City's financial analyst for the overall open space
program; and
Whereas, the Contractor was selected unanimously to conduct this review based on
demonstrated expertise and understanding of the project.
NOW, THEREFORE, in consideration of their mutual covenants, the parties hereto agree
as follows:
1. PROGRAM COORDINATION
A. �V. The City Administrative Officer or his designated representative, shall
be the Project Manager representing the City for all purposes under this
agreement. He shall supervise the progress and execution of this
agreement.
B. Contractor. Contractor shall assign a single Project Manager to have overall
responsibility for the progress and execution of this agreement for
Contractor. Richard Brady is hereby designated as the Project Manager for
Contractor. Should circumstances or conditions subsequent to the
execution of this agreement require a substitute Project Manager for any
reason, the Project Manager designee shall be subject to the prior written
acceptance and approval by City Project Manager.
2. DUTIES OF CONTRACTOR
A. Services to be furnished.
1. The Contractor will provide the services as described in Exhibit 1 of
this document.
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B. Laws to be observed by Contractor.
1. Procure all permits and licenses, pay all charges and fees, and give
all notices which may be necessary and incidental to the due and
lawful prosecution of the services to be performed by Contractor
under this agreement.
2. Keep itself fully informed of all existing and proposed federal, state
and local laws, ordinances, regulations, orders, and decrees which
may affect those engaged or employed under this agreement, any
materials used in Contractor's performance under this agreement,
or the conduct of the services under this agreement.
3. At all times observe and comply with, and cause all of its employees
to observe and comply with all of said laws, ordinances, regulations,
orders, and decrees mentioned above.
4. Immediately report to the City's Project Manager in writing any
discrepancy or inconsistency it discovers in said laws, ordinances,
regulations, orders, and decrees mentioned above in relation to any
plans, drawings, specifications, or provisions of this agreement.
C. Copies of reports and information. If City requests additional copies of
= reports, drawings, specifications, or any other materials in addition to what
the Contractor is required to furnish in limited quantities as part of the
services under this agreement, Contractor shall provide such additional
copies as are requested, and City shall compensate Contractor for the
costs of duplicating of such copies at Contractor's direct expense.
D. Qualifications of Contractor. Contractor represents that it is qualified to
furnish the services described under this agreement.
E. Notwithstanding any representations, oral or written, between parties,
including any and all agents or representatives thereof, Contractor at all
times covered by the terms of this agreement is acting as a free and
independent contractor, not as any agent of the City. Any and all
supervision and direction by any City official, department or body shall be
only that necessary to provide broad general outlines, and Contractor will
use its own initiative and discretion in performing the details of work herein.
F. All services provided by the Contractor listed within this agreement are in
addition and beyond those of any and all other contracts currently held
between the City and Contractor.
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3. DUTIES OF CITY
City agrees to cooperate with Contractor and to perform work described hereto
and incorporated by this reference.
4. COMPENSATION
City shall pay to Contractor a total of $16,900 for services described in Exhibit 1.
The City will provide a retainer of$5,000 to begin the project and cover initial costs,
which will be credited against the total contract amount. Contractor will bill City on
a monthly basis and each bill will include a brief description of services furnished
during the billing period. '
5. TIME FOR COMPLETION OF THE WORK
Contractor will provide City with a completed written, report on all approved tasks
within 60 days of approval of this agreement.
6. TEMPORARY SUSPENSION
The City Project Manager shall have the authority to suspend this agreement wholly
or in part, for such period as he deems necessary due to unfavorable conditions
or to the failure on the part of the contractor to perform any provision of this
agreement. Contractor will be paid the compensation due and payable to the date
of temporary suspension.
7. SUSPENSION; TERMINATION
A. Right to suspend or terminate. The City retains the right to terminate this
agreement for any reason by notifying Contractor in writing sixty (60) days
prior to termination and by paying the compensation due and payable to the
date of termination; if this agreement is terminated for fault of Contractor,
City shall be obligated to compensate Contractor only for that portion of
Contractor services which are of benefit to City. Said compensation is to
be arrived at by mutual agreement of the City and Contractor and should
they fail to agree, then an independent arbitrator is to be appointed by
mutual agreement and his decision shall be binding upon the parties.
8. INSPECTION
Contractor shall furnish City with every reasonable opportunity for City to ascertain
that the services of Contractor are being performed in accordance with the
requirements and intentions of this agreement. All work done and all materials
furnished, if any, shall be subject to the City's Project Manager's inspection and
approval. The inspection of such work shall not relieve Contractor of any of its
obligations to fulfill its agreement as prescribed.
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9. NOTICE
All notices hereunder shall be given in writing and mailed, postage prepaid, by
Certified Mail, addressed as follows:
To Contractor: Economic Research Associates
964 5th Avenue, Suite 214
San Diego, CA 92101
Attention: William Anderson, Principal
To City: City of San Luis Obispo
P. O. Box 8100
San Luis Obispo, CA 93403-8100
Attention: Ken Hampian, Assistant Administrative Officer
10. INTEREST OF CONTRACTOR
Contractor covenants that it presently has no interest, and shall not acquire any
interest direct or indirect financial or otherwise, which would conflict in any manner
or degree with the performance of the services hereunder. Contractor further
covenants that, in the performance of this agreement, no subcontractor or person
having such an interest shall be employed. Contractor certifies that no one who
has or will have any financial interest under this agreement is an officer or
employee of the City. It is hereby expressly agreed that, in the performance of the
services hereunder, Contractor shall at all times be deemed an independent
contractor and not an agent or employee of the City.
11. INDEMNITY
Contractor hereby agrees to indemnify and save harmless City, its officers, agents,
and employees:
A. Any and all claims and demands which may be made against City, its
officers, agents or employees by reason of any injury to or death of any
person or corporation caused by any negligent act or omission of
Contractor under this agreement or of'Contractor's employees or agents;
B. Any and all damage to or destruction of the property of City, its officers,
agents, or employees, occupied or used by or in the care, custody, or
control of Contractor, or in proximity to the site of Contractor's work, caused
by any negligent act or omission of Contractor under this agreement or of
Contractor;
C. Any and all claims and demands which may be made against City, its
officers, agents, or employees by reason of any injury to or death of or
damage suffered or sustained by any employee or agent of Contractor
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under this agreement, however caused, excepting, however, any such
claims and demands which are the result of the negligence or willful
misconduct of City, its officers, agents, or employees;
D. Any and all claims and demands which may be made against City, its
officers, agents, or employees by reason of any infringement or alleged
infringement of any patent rights or claims caused by the use of any
apparatus, appliance, or materials furnished by Contractor under this
agreement; and
E. Any and all penalties imposed or damages sought on account of the
violation of any law or regulation or of any term or condition of any permit,
when said violation of any law or regulation or of any term or condition of
any permit is due to negligence on the part of the Contractor.
Contractor, at its own costs, expense, and risk, shall defend any and all
suits, actions, or other legal proceedings that may be brought against or for
employees on any such claim or demand of such third persons, or to
enforce any such penalty, and pay and satisfy any judgement or decree that
may be rendered against City, its officers, agents, or employees in any such
suit, action or other legal proceeding, when same were due to negligence
of the Contractor.
12. WORKERS COMPENSATION
Contractor certifies that it is aware of the provisions of the Labor Code of the State
of California, which require every employer to be insured against liability for
workers compensation or to undertake self-insurance in accordance with the
provisions of that code, and it certifies that it will comply with such provisions
before commencing the performance of the work of this agreement.
13. INSURANCE
Contractor shall provide proof of insurance in accordance with Insurance
Requirements for Consultants as described in Exhibit "2" attached hereto and
incorporated herein by reference as though here fully set forth.
14. AGREEMENT BINDING
The terms, covenants, and conditions of this agreement shall apply to, and shall
bind,the heirs,successors, executors, administrators, assigns,and subcontractors
of both parties.
15. WAIVERS
The waiver by either party of any breach or violation of any term, covenant, or
condition of this agreement or of any provision, ordinance, or law shall not be
deemed to be a waiver of any subsequent breach of violation of the same or of any
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other term, covenant, condition, ordinance, or law. The subsequent acceptance
by either party of any fee or other money which may become due hereunder shall
not be deemed to be a waiver of any preceding breach or violation by the other
party of any term, covenant, or condition of this agreement or of any applicable law
or ordinance.
16. COSTS AND ATTORNEY FEES
The prevailing party in any action between the parties to this agreement brought
to enforce the terms of this agreement or arising out of this agreement may
recover its reasonable costs and attorney's fees expended in connection with such
an action from the other party.
17. DISCRIMINATION
No discrimination shall be made in the employment of persons under this
agreement because of the race, color, national origin, ancestry, religion, sexual
orientation, or sex of such person.
If Contractor is found in violation of the nondiscrimination provisions of the State
of California Fair Employment Practices Act or similar provisions of federal law or
executive order in the performance of this agreement, it shall thereby be found in
material breach of this agreement. Thereupon, City shall have the power to cancel
or suspend this agreement, in whole or in part, or to deduct from the amount
payable to Contractor the sum of Twenty-Five Dollars ($25) for each person for
each calendar day during which such person was discriminated against, as
damages for said breach of contract, or both. Only a finding of the State of
California Fair Employment Practices Commission or the California Fair
Employment Practices Commission or the equivalent federal agency or officer shall
constitute evidence of a violation of contract under this paragraph.
If Contractor is found in violation of the nondiscrimination provisions. of this
agreement or the applicable affirmative action guidelines pertaining to this
agreement, Contractor shall be found in material breach of the agreement.
Thereupon, City shall have the power to cancel or suspend this agreement, in
whole or in part, or to deduct from the amount payable to Contractor the sum of
Two hundred Fifty Dollars ($250) for each calendar day during which Contractor
is found to have been in such noncompliance as damages for said breach of
contract, or both.
18. AGREEMENT CONTAINS ALL UNDERSTANDINGS
This document represents the entire and integrated agreement between City and
Contractor and supersedes all prior negotiations, representatives, or agreements
either written or oral. This document may be amended only by written instrument,
signed by both City and Contractor. All provisions of this agreement are expressly
made conditions. This agreement shall be governed by the laws of the State of
California.
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IN WITNESS WHEREOF, City and Contractor have executed this agreement on the day
and year first above written.
Economic Research Associates
BY
William Anderson, Principal
CITY OF SAN LUIS OBISPO
BY
Ron Dunin, Mayor
ATTEST:
City Clerk
APPROVED AS TO FORM:
gr7 en n,r A rney
ecoresearch.agr
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ics Research Associates
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March 18, 1992
Mr. Ken Hampian
Assistant City Administrative Officer
City of San Luis Obispo
990 Palm Street
P.O. Box 8100
San Luis Obispo, CA 93403-8100
Proposal No. 29796
Dear Ken:
Pursuant to our meeting on March 6, I've prepared this letter proposal for your consideration.
UNDERSTANDING OF THE ISSUES
We understand that the 117 acre Dalidio property is prime agricultural land located next to
the city's regional shopping center. The property owner has proposed to develop 40 acres as
commercial uses which would expand the shopping center complex, develop an additional 10
acres of high density residential uses, and sell 67 acres to the City. The City Council has
conceptually agreed to the proposal, with the intent of preserving the 67 acres the City will
acquire as open space. The development proposal will require annexation, a general plan
amendment, and a zoning change.
The value of the land to be sold to the City is in question. Under the County's jurisdiction,
the parcel is currently zoned for single family use, but we understand that development
restrictions on the property effectively limit the density to one unit per 10 acres. Under the
City's general plan, the land is currently zoned for R1 use, or approximately 6 units per acre.
The property owner is asking approximately $85,000 per acre for the 67 acres to be sold to the
City based on the comparable value of R1 properties within the unincorporated county. The
City, however, intends to keep the land in agricultural use. The City and the property owner
will soon begin negotiations regrading the sale price for the 67 acres and the development plan.
The City considers these negotiations important not only for establishing a purchase price for
this specific property,but for establishing precedent for the value of open space elsewhere in
the City's sphere of influence.
The City,.therefore, is requesting this proposal to help it prepare a strategic approach for
establishing the property's value, possibly analyze the fiscal impacts of developing a portion
964 5th Avenue, Suite 214,San Diego. California 92101•(619)544-1402 Fax:(619)544-1404
Los Angeles•San Francisco•San Diego•Chicago-Boston-Washington, D.C.•Fort Lauderdale
EXHIBIT 1 ` /
of the property, and assisting the City in its negotiations with the property owner.
PROPOSED SCOPE OF SERVICES
We propose the following scope of work to help the City address the issues raised:
I.0: Orientation
Although we have driven onto the site during our tour of potential open space areas in San
Luis Obispo, we would need to visit the Dalidio Property with City staff to carefully
understand its existing physical configuration, relationship to the regional shopping center,
surrounding uses, and access potential. We would also want to visit the adjacent shopping
center. We have already read most of the background material related to this property, so we
only anticipate a brief orientation effort.
Hou rs: 4
Budget: $520
Task 2.0- General Market Review
We have already collected data regarding land values in the San Luis Obispo area as part of
our current open space planning effort; therefore, we will only need to supplement this data
compilation effort to establish commercial, residential, and agricultural land values based on
recent sales in the region. We do anticipate some research and verification of land sales
specifically focused on this property.
We will collect demographic data including the following:
• Population growth
• Household formation and growth
' Income distribution
• Age distribution
This demographic data will help us evaluate trends and absorption potential.
We will survey commercial centers and relevant multi-family residential developments to
establish potential values, rents, and occupancy rates.
Hours: 24
Budget: $1,800
Task 3.0: Residual Land Value Analvsis
Based on the data collected above,w•e will prepare a residual land value analysis of alternative
scenarios:
1. Development of the property as proposed.
2. Development of the property under single family residential zoning as permitted
by the county.
3. Development of the property under single family residential zoning as permitted
by the city.
4. Retention of the property under its agricultural use.
Absorption and value assumptions will be based on the market review conducted in Task 2.0.
The potential amount of income each development scenario generates for the property owner,
less development costs and alternative.rates of return, will allow us to estimate how much the
Iand is worth under the different scenarios.
We will then compare the residual land value of the different scenarios to estimate the extent
different entitlements enhance the property's value to the property owner.
Hours: 32
Budget: $3,840
Task 4.0: Fiscal 1•mnaet Analvsis
The fiscal impact of the proposed development scenario is a factor which the City may
consider in evaluating the development proposal. We will estimate the net fiscal impact from
property taxes, sales taxes, fees, and other fiscal revenue, less the public costs to serve the
property for the different scenarios identified in Task 3.0. This analysis will help the City
evaluate the incremental fiscal impact of different land use scenarios, and the fiscal value of
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the proposed development scenario. Based on the market review conducted in Task 2.0, we
will estimate how much of the retail sales generated by development at.the site will be new
incremental revenue to the city versus a transfer from other retail outlets within the city.
Hours: 40
Budget: $3,600
Task 5.0; Recommendations Reeardine the City's Negotiating Position
Based on the residual land value analysis, market sales data, and the fiscal impact analysis,
we will advise the City as to the value of the enhanced entitlement to the property owner, the
value to the City of the development proposal, fiscal and economic benefits, and a reasonable
value for the 67 acres the City may acquire. This analysis is not an appraisal of the 67 acres,
but is an evaluation of the total property's value from enhanced entitlements and annexation
to the City, and an estimate of how much the City should be willing to pay and how much the
property owner should be willing to accept for the 67 acres, reasonably acting in their best
interest. It is understood that some of the 67 acres could be dedicated or protected through
the subdivision approval process, and would not have to be purchased.
Hours: 12
Budget: $1,440
Task 6.0: Memorandum Report
We will prepare a memorandum report documenting our findings and recommendations. This
report will be presented to staff in draft form and will be revised based on staff comments.
Hours: 8
Budget: $960
Task 7.0: Assistance in Negotiations
We will be prepared to assist the City in its negotiations with the property owner, either by
providing background research and developing negotiation strategies with City staff, or by
participating in the negotiations directly.
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Hours: As needed
Budget: Time and materials
Task 8.0: Meetines
We anticipate four meetings, as follows:
1) The Orientation meeting
2) Presentation of Draft Report to staff
3) Presentation of Final Report to Council
4) Strategy session with staff
Tw•o people from ERA will be available to attend each meeting.
Hours: 24
Budget: $2,880
TOTAL BUDGET AND SCHEDULE
The budget below excludes Task 7.0 which would be conducted on a time and material basis.
Budeet
Consultant Hours: $15,040
Clerical Hours (20): 360
Materials: 100
Travel: 1,400
' 4 Trips for meetings@
1.5 persons per trip
' 1 Trip for research @
1.0 person per trip
Total Budget $16,900
We hope this proposed work program meets your needs. I have enclosed resumes of the staff .
who would be assigned to this project and our brochures. If you have any questions, or would
like us to elaborate or refine particular elements of the work program please give me a call.
If you approve this proposal, we can draft the contract with this proposal serving as the Scope
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of Services. We would request a retainer of $5,000 to begin the study and cover initial costs.
This amount would be credited against the contract budget. I look forward to hearing from
you soon.
Sincerely,
William Anderson, Principal
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rSURA:'�CE REQLT)RE.NMNTS FOR CONSULTANTS
Consultant shall procure and maintain for the duration of the contract insurance against claims for injuries to persons
damages to property which may arise from or in connection with the performance of the work hereunder by the Consulta,
his agents, representatives, employees.
Minimum Scope of Insurance
Coverage shall be at least as broad as:
L Insurance Services Office Commercial General Liability coverage (occurrence form CG 0001).
2. Insurance Services Office form number CA 0001 (Ed. 1/87) covering Automobile Liability, code 1 (any
auto).
3. Workers' Compensation insurance as required by the State of California and Employer's Liability
Insurance.
4. Errors and Omissions Liability insurance as appropriate to the consultant's profession.
Minimum Limits of Insurance
Consultant shall maintain limits no less than:
I. General Liability: $1,000,000 per occurrence for bodily injury, personal injury and property damage.
If Commercial General Liability or other form with a general aggregate limit is used, either the general
aggregate limit shall apply separately to this project/]ocation or the general aggregate limit shall be twice
the required occurrence limit.
2. Automobile Liability: $1,000,000 per accident for bodily injury and property damage.
3. Employer's Liability: $1,000,000 per accident for bodily injury or disease.
4. Errors and Omissions Liability: $1,000,000 per occurrence.
Deductibles and Self-Insured Retentions
Any deductibles or self-insured retentions must be declared to and approved by the City. At the option of the City,
either. the insurer shall reduce or eliminate such deductibles or self-insured retentions as respects the City, its
officers,officials,employees and volunteers,or the Consultant shall procure a bond guaranteeing payment of losses
and related investigations, claim administration and defense expenses.
Other Insurance Provisions
The general liability and automobile liability policies are to contain, or be endorsed to contain, the following
provisions:
L The City,its officers, officials,employees, agents and volunteers are to be covered as insureds as respects:
liability arising out of activities performed by or on behalf of the Consultant; products and completed
operations of the Consultant;premises owned, occupied or used by the Consultant;or automobiles owned,
leased, hired or borrowed by the Consultant The coverage shall contain no special limitations on the
scope of protection afforded to the City, its officers, official, employees, agents or volunteers.
2. For any claims related to this project, the Consultant's insurance coverage shall be primary insurance as
respects the City, its officers, officials, employees, agents and volunteers. Any insurance or self.
insurance maintained by the City, its officers, officials, employees, agents or volunteers shall be excess
of the Consultant's insurance and shall not contribute with iL
3. Any failure to comply with reporting or other provisions of the policies including breaches of warranties
shall not affect coverage provided to the City, its officers, officials, employees, agents or volunteers.
4. The Consultant's insurance shall apply separately to each insured against whom claim is made or suit is
brought, except with respect to the limits of the insurer's liability.
5. Each insurance policy required by this clause shall be endorsed to state that coverage sball not be
suspended,voided, cancelled by either party, reduced in coverage or in limits except after thirty(30)days'
prior written notice by certified mail, return receipt requested, has been given to the City.
Acceptability of Insurers
Insurance is to be placed with insurers with a current A.M. Best's rating of no less than A:VII.
Verification of Coverage
Consultant shall furnish the City with a cer::ficate of insurance showing maintenance of the required insurance
coverage. Original endorsementse"e :=-_ral liability and automobile liability coverage required by this clause
must also be provided. The endorsements are to be si=ned by a person authorized by that insurer to bind coverage
on its behalf. All endorsements are to be received and approved by the City before work commences.
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EXHIBIT 2 C —/�