Los Angeles Rent Agreement

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Executive Director's
Report to the
DATE: DECEMBER 27,2006 Board of Harbor Commissioners

FROM: REAL ESTATE DIVISION

SUMMARY:

In March 2006, the Port issued a Request for Proposal (RFP) to Child Care Center operators for
the operation of its Child Day Care facility located at 100 West 5th Street. The YWCA of the
Harbor Area & South Bay, located at 437 West gth Street in San Pedro, was selected as the top-
ranked candidate. An operating agreement has been negotiated for a three-year term, with an
additional three-year term option. The Port will reimburse the operator for incurred expenses
related to materials and supplies, living wage salary differential, and ten percent (10%) discount
for Harbor employees, in an amount not to exceed $100,000 per year. The not to exceed amount
excludes maintenance, security, utilities, custodial services and landscaping. Those costs will be
absorbed by the Port.

RECOMMENDATION:

It is recommended that the Board of Harbor Commissioners:

1. Find that in accordance with City Charter Section 1022, it is more feasible for this work to be
done by an independent contractor than by City employees;

2. Adopt the Order approving the operating agreement for operation of the Child Day Care
Center between the City of Los Angeles Harbor Department and the YWCA of the Harbor
Area and South Bay;

3. Direct the Board Secretary to transmit to the City Council for approval of the Order and
Agreement, pursuant to City Charter 373; and

4. Authorize the Executive Director to execute the operating agreement and the Board Secretary
to attest to said operating agreements after Board of Harbor Commissioners and City Council
approval.

PREVIOUS BOARD ACTION:

1. In April 1994, the Board of Harbor Commissioners approved Agreement No. 1777
selecting the YWCA of the Harbor Area to establish Worldtots LA and assume
I
DATE: DECEMBER 27,20b6 PAGE 2 OF 4

1 FROM: REAL ESTATE DIVISION

SUBJECT: PROPOSED AGREEMENT BETWEEN THE PORT OF LOS ANGELES
AND YOUNG WOMEN'S CHRISTIAN ASSOCIATION (YWCA) OF THE
HARBOR AREA & SOUTH BAY FOR THE OPERATION OF THE
CHILD DAY CARE CENTER COMMONLY KNOWN AS WORLDTOTS
LA, LOCATED AT 100 WEST 5THSTREET IN SAN PEDRO
I
responsibility for staffing, supplying and administering the child care center in
accordance with all applicable laws, regulations, and requirements. '-The initial agreement
was for a three-year period and subsequently amended in 1997,2000, and 2003 to extend the
term of the agreement in three-year increments. Agreement No. 1777, as amended, expired
on May 10,2006, at which time when the City had not completed the process of finalizing a
successor agreement.

I
2. The three Bridge Agreements (Nos. 2471, 2484 and 2495), which were approved by the
I
Board of Harbor Commissioners on April 25,2006, August 10,2006, and November 2,2006,
respectively, provided that the child care center operations continued until a successor multi-
year agreement was completed and brought before the Board of Harbor Commissioners and
City Council. The third bridge agreement will expire March 7, 2007. All other terms and
conditions will remain unchanged.

DISCUSSION:

1. In support of the City of Los Angeles, Child Care Policy, the Harbor Department also
recognizes the importance of high quality child care and is committed to supporting
existing center-based child care facilities. Recognizing that access to consistent and
stable child care arrangements improves employee productivity, the City of Los
Angeles has established three high quality child care centers to serve its employees and
the community. Worldtots LA, a child care center supported by Harbor Department
employees, is one such facility.

2. The YWCA of the Harbor Area and South Bay is licensed by the State of California for
the operation of a Child Day Care facility. The YWCA has operated the Harbor
Department Child Day Care facility, commonly known as Worldtots LA since 1994. The
YWCA has continued to meet the needs of Department employees and the community
by providing a high quality child day care program for ages 0-5 years.

In March 2006, the Request for Proposal was advertised through the Port's legal
advertisement service provider, including advertisements in local minority community
publications, trade journals and websites relevant to the work to be performed. In
addition to advertising this opportunity through the Port's legal advertisement services
and website, the Port requested bids from seventeen local companies that were identified
by the County of Los Angeles, Office of Child Care. The mailing list of the companies
notified, accompany this report as an attachment. The Port's efforts resulted in five
companies participating in the pre-proposal meeting and only one company, YWCA,
submitting a proposal.
DATE: DECEMBER 27,2006 PAGE 3 OF 4

FROM: REAL ESTATE DIVISION

4. In consideration for providing the services required by this agreement, the Port will
provide a rent-free facility together with furnishings, maintenance, landscape, security
and custodial services. The Port will reimburse the operator for incurred expenses related
to materials and supplies, living wage salary differential, and ten percent (10%) discount
for Harbor employees in an amount not to exceed $100,000 per year.

5. Based on household income guidelines established for the City of Los Angeles, the
YWCA's Child Day Care Program meets the 25% threshold for participation of children
in the low to moderate income inltheir child day care program. The child care cost for
families of low to moderate income are subsidized by the State Children Home Society,
Department of Social Services GAIN Program and other governmental and private
resources.

6. The duties and responsibilities for the operator and the City are incorporated in the
proposed successor operating agreement, together with the standard language required in
all City agreements.

7. The proposed successor operating agreement requires the City Council approval, in
addition to the Board of Harbor Commissioners approval.

8. The proposed successor operating agreement will supersede (replace) the any applicable
bridge agreement that may be in place.

ENVIRONMENTAL ASSESSMENT:

The Director of Environmental Management has determined that the proposed action is exempt
from the California Environmental Quality Act (CEQA) in accordance with Article 111, Class 1
(14) of the Los Angeles City CEQA Guidelines.

FINANCIAL IMPACT:

Approval of this Agreement would authorize the Port to enter into a three-year agreement (with
an additional three-year term option) with the YMCA to operate a child day care facility in
accordance with the City's Child Care Policy. The Agreement provides for the Port to reimburse
the YWCA up to $100,000 per year for a total not-to-exceed amount of $300,000 over three
years. It is anticipated that the reimbursed funds will be used to cover a portion of child care
related supplies and discounts given to Port employees who use its services. Historically the
amount reimbursed by the Port has been under the $100,000 authorized per fiscal year with last
fiscal year's reimbursement amount being about $39,000. Of the 61 children under the Center's
care, 46% have parents who are employees of either the City or the Port's tenants with the
remaining 54% of the children coming from the community.
DATE: DECEMBER 27,2006 PAGE 4 OF 4

FROM: REAL ESTATE DIVISION

Funds for FY 2006107 are available in Account No. 54290 (Miscellaneous Professional Services)
Center No. 0424, Program 000. The remaining contract amount will be incorporated in the FY
2007108 and FY 2008109 budget process.

CITY ATTORNEY:

The operating agreement have been reviewed and approved as to form by the Office of the City
Attorney.

TRANSMITTALS:

j 1. Operating Agreement
2 Board Order

Director of
Real Estate Division

G E ~ I N KNATZ, P ~ . D .
E
Ex utive Director
PAT:PEW:raw
BL173raw
ADP # 060531-107