REPORT/RECOMMENDATION TO THE BOARD OF SUPERVISORS
OF THE COUNTY OF SAN BERNARDINO
AND RECORD OF ACTION
March 10, 2020
FROM
TERRY W. THOMPSON, Director, Real Estate Services Department
TRUDY RAYMUNDO, Director, Department of Public Health
SUBJECT
Title
Amendment No. 4 to Lease Agreement with Victor Valley Hospital Acquisition, Inc. dba Victor Valley Global Medical Center for Office Space for the Department of Public Health, Women, Infants and Children Program in Victorville
End
RECOMMENDATION(S)
Recommendation
1. Approve the Real Estate Services Department’s use of an alternative procedure in lieu of a Formal Request for Proposals as allowed per County Policy 12-02 - Leasing Privately Owned Real Property for County Use, to extend the term of Lease Agreement No. 08-1249 with Victor Valley Hospital Acquisition, Inc. dba Victor Valley Global Medical Center for three years from April 1, 2020 to March 31, 2023 and add two three-year options to extend the term of the lease for the Department of Public Health, Women, Infants and Children Program in Victorville.
2. Approve Amendment No. 4 to Lease Agreement No. 08-1249 with Victor Valley Hospital Acquisition, Inc. dba Victor Valley Global Medical Center, to extend the term of the lease for three years for the period of April 1, 2020 through March 31, 2023, add two three-year options extending the term of the lease, and update standard lease agreement language for 3,903 square feet of office space at 15247 Eleventh Street in Victorville for the Department of Public Health, Women, Infants and Children Program in the amount of $295,056.
(Presenter: Terry W. Thompson, Director, 387-5000)
Body
COUNTY AND CHIEF EXECUTIVE OFFICER GOALS & OBJECTIVES
Provide for the Safety, Health and Social Service Needs of County Residents.
Operate in a Fiscally-Responsible and Business-Like Manner.
FINANCIAL IMPACT
Approval of this item will not require additional Discretionary General Funding (Net County Cost). The total cost of this three-year amendment is $295,056. Lease payments will be made from the Rents budget (7810001000) and reimbursed from the Department of Public Health (DPH) Women, Infants and Children (WIC) budget (9300061000), which is 100% federally funded. Sufficient appropriation is included in the 2019-20 Rents and DPH budgets and will be included in future recommended budgets. Annual lease costs are as follows:
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Year |
Annual Lease Cost |
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April 1, 2020 - March 31, 2021 |
$96,480 |
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April 1, 2021 - March 31, 2022 |
$98,352 |
|
April 1, 2022 - March 31, 2023 |
$100,224 |
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Total Cost |
$295,056 |
BACKGROUND INFORMATION
The recommended action will amend an existing lease with Victor Valley Hospital Acquisition, Inc. dba Victor Valley Global Medical Center to reflect an extension of the term of the lease from April 1, 2020 through March 31, 2023, add two three-year options to extend the term of the lease, adjust the rental rate, and update standard lease agreement language because of the continuing need to provide (WIC) services in the Victorville area.
On December 16, 2008 (Item No. 48), the Board of Supervisors (Board) approved a five-year lease agreement, No. 08-1249, with two three-year options to extend the term of the lease for 3,198 square feet of office space for the DPH WIC program located at 15247 Eleventh Street in Victorville. The original term of the lease was for the period of April 1, 2009 to March 31, 2014. In the 12 years since the lease was originally approved, the Board has approved the following three amendments to exercise options to extend the term of the lease, increase the square footage by 705 square feet, increase the rent, reflect a change of property ownership, and update standard lease agreement language.
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Amendment No. |
Approval Date |
Item No. |
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1 |
March 11, 2014 |
25 |
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2 |
December 16, 2014 |
60 |
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3 |
March 28, 2017 |
45 |
With a continuing need for WIC to provide services in this area of Victorville, DPH requested the Real Estate Services Department (RESD) extend the term of the lease three years for the period of April 1, 2020 through March 31, 2023, add two three-year options to extend the term, adjust the rent, and update standard lease agreement language. All other terms and conditions of the lease remain unchanged.
Staff has reviewed the recommended action pursuant to the California Environmental Quality Act (CEQA) and has determined that it does not constitute a project. Accordingly, no further action is required under CEQA.
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Summary of Lease Terms |
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Lessor: |
Victor Valley Hospital Acquisition, Inc. dba Victor Valley Global Medical Center (Suzanne Richards, Chief Executive Officer) |
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Location: |
15247 Eleventh Street, Victorville |
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Size: |
3,903 square feet of office space |
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Term: |
Three years commencing April 1, 2020 |
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Options |
Two three-year options |
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Rent: |
Cost per sq. ft. per month: $2.06 Full Service Gross |
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Monthly: $8,040 |
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Annual: $96,480 |
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*Mid-range for comparable facilities in the Victorville area per the competitive set analysis on file with RESD |
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Annual Increases: |
2% |
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Improvement Costs: |
None |
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Custodial |
Provided by Lessor |
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Maintenance: |
Provided by Lessor |
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Utilities: |
Provided by Lessor |
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Insurance: |
The Certificate of Liability Insurance, as required by the lease, is on file with RESD |
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Right to Terminate: |
County has the right to terminate with 90-days’ notice |
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Parking: |
Sufficient for county needs |
PROCUREMENT
On December 16, 2008 (Item No. 48), the Board approved Lease Agreement No. 08-1249, which was procured via a Solicitation of Proposals (SOP) pursuant to County Policy 12-02 - Leasing Privately Owned Real Property for County Use (Policy). Extending the term of the lease would normally require a Formal Request for Proposals (Formal RFP) process. The Policy also provides that the Board may approve the use of an alternative procedure to the Formal RFP process whenever the Board determines that compliance with the Formal RFP requirements would unreasonably interfere with the financial or programmatic needs of the County or when the use of an alternative procedure would otherwise be in the best interest of the County. RESD completed a competitive analysis of the area and found the negotiated rental rate for the extended term is competitive and the department would avoid considerable moving expenses if WIC stays in the current location. WIC is requesting the Board approve an alternative procedure, as provided in the Policy, to extend the term three years and add two three-year options to extend the term of the lease as this facility best meets the requirements of WIC to provide services to clients in the Victorville area.
REVIEW BY OTHERS
This item has been reviewed by County Counsel (Agnes Cheng, Deputy County Counsel, and Adam Ebright, Deputy County Counsel, 387-5455) on February 11, 2020; Department of Public Health (Corwin Porter, Assistant Director, 387-6218) on January 9, 2020; Purchasing Department (Michelle Churchill, Supervising Buyer, 387-2070) on January 29, 2020; Finance (Paul Garcia, Administrative Analyst, 386-8392 and Monique Amis, Administrative Analyst, 387-4883) on February 18, 2020 and County Finance and Administration (Matthew Erickson, County Chief Financial Officer, 387-5423) on February 24, 2020.
(PN: 677-8321)