For City Council Meeting [September 14, 2021]
TO: Honorable City Council
APPROVAL: Marcus Fuller, City Manager
FROM: Marcus Fuller, City Manager
Title
Request City Council to Approve a Fifth Amendment to the Lease Agreement with the County of San Bernardino for the Library site located at 251 West First Street.
Body
BACKGROUND
The County of San Bernardino (“County”) currently leases and operates a public library in a City owned building of 12,400 square feet at 251 West First Street. The County’s lease commenced on May 1, 2005 and had an initial term of five years, with a one (1) three-year option and two (2) one-year options (“Lease Agreement”). A copy of the Lease Agreement is included as Attachment 1.
On May 28, 2010, the County exercised the three-year option via the First Amendment to the Lease Agreement extending the term to April 30, 2013, and subsequently exercised the two one-year options that ultimately expired on April 30, 2015.
On March 12, 2013, the City Council approved the Second Amendment to the Lease Agreement which granted the County two additional three-year options extending the lease from May 1, 2015 through April 30, 2021.
On April 28, 2015, the City Council approved the Third Amendment to allow the County to exercise its first three-year option extending the Lease Agreement from May 1, 2015 to June 30, 2018.
On August 28, 2018, the City Council approved the Fourth Amendment to allow the County to exercise its second three-year option extending the Lease Agreement from July 1, 2018 to October 31, 2021.
ANALYSIS/DISCUSSION
The County has requested that the City continue to lease its facility to the County to continue its operations as a public library. Included herewith is the Fifth Amendment to the Lease Agreement that will incorporate the following changes to the Lease Agreement:
• Extend the term four years from November 1, 2021 through October 31, 2025
• Increase the rent from its current rate of $5,952 per month to $6,026 per month and 2% in each annual extension thereafter
• Revises Section 22 “Landlord’s Remedies on County’s Default” to allow for termination upon County’s default
• Updates Section 24 “Notices” with current names and titles
The City’s use of the Library is reserved as previously agreed in the Fourth Amendment to the Lease Agreement, whereby the City can provide 7 days written request to use the Library’s community room.
The Fifth Amendment to the Lease Agreement is included as Attachment 2.
ENVIRONMENTAL IMPACT:
The action proposed is not a project under California Environmental Quality Act (CEQA). The proposed action to approve the lease amendment is an administrative or fiscal action by the legislative body and will not result in any changes to the environment.
GENERAL PLAN CONSISTENCY:
The City of Rialto has identified several goals and objectives within the City’s recently adopted General Plan through which the City looks to improve the community. The proposed action to approve the lease amendment is consistent with the following goals and objectives contained in the General Plan:
Goal 3-11: Provide community facilities that adequately support established programs, can accommodate future needs, and are accessible to all members of the community.
Goal 3-13: Provide high-quality library resources to meet the educational, cultural, and lifelong learning needs of all residents.
Policy 3-13.1: Continue the innovative partnership with the San Bernardino County Library and Friends of the Rialto Library to improve the quality of library services in Rialto.
Policy 3-13.2: Coordinate with San Bernardino County to develop programs and services that meet future needs of adults, children, and new readers.
LEGAL REVIEW:
The City Attorney prepared and approved this staff report and Fifth Amendment to the Lease Agreement.
FINANCIAL IMPACT:
Operating Budget Impact
The City will receive a total of $300,600 in rental income for the four year term extension. Revenues from this lease will be deposited into the General Fund Account No. 010-400-0001-7402.
- FY 2021/22 - $6,076 per month ($72,912)
- FY 2022/23 - $6,200 per month ($74,400)
- FY 2023/24 - $6,324 per month ($75,888)
- FY 2024/25 - $6,450 per month ($77,400)
Capital Improvement Budget Impact
The Lease Agreement in Section 12 requires the City to provide maintenance or repairs as are necessary and requires the City and County to negotiate any major capital improvement costs.
RECOMMENDATION:
Staff recommends that the City Council:
1. Approve the Fifth Amendment to the Lease Agreement; and
2. Authorize the City Manager to execute all documents.