CC - Item 4B - Los Angeles County Metropolitan Transportation AuthorityROSEMEAD CITY COUNCIL
STAFF REPORT
TO: THE HONORABLE MAYOR AND CITY COUNCIL
FROM: OLIVER CHI, CITY MANAGER
DATE: MARCH 10, 2009
SUBJECT: EXCHANGE AGREEMENT - CONVERSION OF FEDERAL SURFACE
TRANSPORTATION LOCAL (STP-L) FUNDS TO FLEXIBLE LOS
ANGELES COUNTY METROPOLITAN TRANSPORTATION
AUTHORITY FUNDS
SUMMARY
The Federal Surface Transportation Program Local (STP-L) program provides a funding
source for a variety of transportation and local infrastructure projects. In order to
obligate the use of these funds, local agencies must go through a lengthy and
• administratively in-depth process due to federal grant regulations. The Los Angeles
County Metropolitan Transportation Authority (Metro) offers local agencies an exchange
program where STP-L funds may be exchanged for more flexible Metro funds allowing
for easier access to transportation funds.
Staff Recommendation
Staff recommends that the City Council approve the exchange agreement with the Los
Angeles County Metropolitan Transportation Program for the City's Federal Surface
Transportation Program Local (STP-L) funds and authorize the City Manager to execute
the agreement on behalf of the City.
DISCUSSION
The Los Angeles County Metropolitan Transportation Authority (Metro) has initiated a
program to allow local agencies to exchange Federal Surface Transportation Program
Local (STP-L) funds for flexible Metro funds. This exchange program allows local
agencies to access these STP-L funds without having to go through the complex federal
obligation process for use of these transportation funds. In addition, this exchange
program makes funding available immediately upon the execution of the exchange
agreement rather than going through a restrictive and timely reimbursement process.
The City of Rosemead currently holds an STP-L balance of $832,116. Upon execution
of this-cchange_agreement-Mietro wilLmake-an-electronic-disbursement-ire-tbe-amount
• of $815,473 to the City, which includes a 2% processing and administrative fee payable
to Metro. Staff has determined that this fee is acceptable and that this exchange
agreement will speed up project delivery, reduce administrative processing
requirements, and allow the City to begin earning interest on these funds immediately.
APPROVED FOR CITY COUNCIL AGENDA: L ITEM NO.. 48
City Council Meeting
• March 11, 2009
Page 2 of f 2
The City's Fiscal Year 2008-09 Capital Improvement Budget includes a street
resurfacing project on Garvey Avenue from San Gabriel Boulevard to the westerly City
limit. Processing this exchange agreement will allow staff to streamline the design
process for this project by several months and take advantage of extremely favorable
bidding conditions for public works projects.
FINANCIAL REVIEW
If approved, the cost to convert the STP-L funds to more flexible Metro funds is the 2%
administrative fee of $16,643.
PUBLIC NOTICE
This agenda item has been noticed through the regular agenda notification process.
Prepared by:
Chris Marcarello
Deputy Public Works Director
• Submitted by:
Brian Saeki
Assistant City Manager
Attachment A: Exchange Agreement
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• Enclosure B
EXCHANGE AGREEMENT AND ASSIGNMENT OF FEDERAL SURFACE
TRANSPORTATION PROGRAM - LOCAL FUNDS
This Exchange Agreement and Assignment of Federal Surface Transportation Program -
Local Funds ("AGREEMENT"), is made and entered into as of January 23, 2009, by
and between City Rosemead (the "CITY") and the Los Angeles County Metropolitan
Transportation Authority ("LACMTA").
RECITALS:
A. CITY is eligible for and has available Federal Surface Transportation Program-
Local funds (the "STP-L Funds").
B. CITY desires to exchange $ 832,116 of CITY's STP-L Funds for a like amount of
LACMTA STP-L Local Transportation Funds (the "LACMTA Funds").
C. LACMTA is willing to exchange $ 832,116 in LACMTA Funds for a like amount
of CITY's STP-L Funds subject to the terms and conditions contained herein.
• D. An exchange of CITY's STP-L Funds with LACMTA Funds is beneficial to and
in the general interest of CITY and LACMTA.
NOW THEREFORE, in consideration of the mutual benefits to be derived by CITY and
LACMTA and of the promises contained herein, it is hereby agreed as follows:
AGREEMENT:
1. CITY hereby assigns to LACMTA $ 832,116 of CITY'S STP-L Funds.
LACMTA shall be authorized to deduct such amount from CITY's STP-L Fund balance.
This assignment shall be automatically effective upon full execution of this
AGREEMENT without the necessity of the execution, delivery or recording of any
further instrument whatsoever. Notwithstanding the foregoing, at LACMTA's request,
CITY shall execute and deliver such documents and instruments as may be required to
evidence such assignment of STP-L Funds.
2. LACMTA hereby accepts CITY's assignment of CITY's STP-L Funds for use on
Federal-aid-eligible project(s), to be determined by LACMTA in its sole and absolute
discretion.
3. Upon receipt of (i) a fully executed AGREEMENT, (ii) CITY's written
certification of the amount of CITY's STP-L Fund Balance, as defined herein, which
ITY's STP=LFurid-Balance shows that-CITY has sufficient STP-Ii funds to meei its
• obligations hereunder, and (iii) LACMTA's deduction of the CITY's STP-L Funds as
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• provided in paragraph 1 above, LACMTA shall pay CITY $815,473 of LACMTA Funds
which includes the deduction for the processing fee described in paragraph 5 below, For
purposes of this AGREEMENT, the CITY's STP-L Fund Balance shall mean the amount
of funds contained in CITY's STP-L Fund account as of the date this AGREEMENT is
fully executed plus CITY's FY2009 apportionment share of STP-L Funds. If the STP-L
Fund Balance is insufficient to satisfy CITY's exchange obligations hereunder, CITY
hereby authorizes LACMTA to deduct from CITY's future STP-L Funds until LACMTA
has in the aggregate received the amount of CITY's STP-L Funds specified in paragraph
1 above.
4. LACMTA will make all disbursements electronically unless an exception is requested
in writing. CITY must complete an Automated Clearing House (ACH) form as provided in
Exhibit A. Disbursements via ACH will be made at no cost to CITY.
5. CITY shall pay LACMTA a two (2) percent processing and administrative fee
("Processing Fee") in connection with the exchange contemplated by this
AGREEMENT. The Processing Fee shall be assessed against the total amount of
LACMTA Funds payable to CITY. The CITY hereby authorizes LACMTA to deduct the
Processing Fee from the amount LACMTA is to pay CITY hereunder.
6. CITY shall expend the LACMTA Funds on STP-L Eligible Projects within three
(3) years from the date this Agreement is fully executed. For purposes of this
• Agreement, STP-L Eligible Projects shall mean any transportation capital improvements .
that would normally qualify for the STP-L program, provided however, any federal
regulations and standards relating to procurement and other project delivery issues that
might apply may be substituted with applicable state and local regulations, standards and
policies; and "expend" as used in this section shall mean that the LACMTA Funds have
been encumbered by an awarded contract.
7. LACMTA, and/or its designee, shall have the right to conduct audits of CITY'S use
of the LACMTA Funds to determine compliance with terms and conditions of this
AGREEMENT. CITY shall establish and maintain proper accounting procedures and cash
management records and documents in accordance with Generally Accepted Accounting
Principles (GAAP). CITY shall reimburse LACMTA for any expenditure not in
compliance with this AGREEMENT. CITY's records shall include, without limitation,
any supporting evidence deemed necessary by LACMTA to substantiate CITY's use of
LACMTA Funds. These records must be retained by CITY for three years following
CITY's last use of the LACMTA Funds.
The term of this AGREEMENT shall commence on the date this AGREEMENT is
fully executed and, shall terminate once the CITY has expended all the LACMTA Funds
and all LACMTA audit and reporting requirements have been satisfied.
9. CITY shall fully indemnify, defend and hold LACMTA and its officers, agents
• and employees harmless from and against any liability and expenses, including, without
limitation, defend costs, any costs or liability on account of bodily injury, death or
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• personal injury of any person or for damages of any nature whatsoever arising out of (i) a
breach of CITY's obligations under this AGREEMENT; or (ii) any act or omission of
CITY or its officers, agents, employees, contractors or subcontractors in the use of the
LACMTA Funds.
10. LACMTA shall fully indemnify, defend and hold CITY and its officers, agents
and employees harmless from and against any liability and expenses, including, without
limitation, defend costs, any costs or liability on account of bodily injury, death or
personal injury of any person or for damages to or loss of risk of property, any
environmental obligations, any legal fees and any claims for damages of any nature
whatsoever arising out of (i) a breach of LACMTA's obligations under this
AGREEMENT; or (ii) any act or omission of LACMTA or its officers, agents,
employees, contractors or subcontractors in the use of CITY'S STP-L Funds.
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11. This AGREEMENT may be amended or modified only by mutual written consent
of LACMTA and CITY.
12. Any correspondence, communication, or contact concerning this AGREEMENT
shall be directed to the following:
CITY:
LACMTA:
Los Angeles County Metropolitan Transportation Authority
One Gateway Plaza
Los Angeles, California 90012
Attn: Frank Flores
13. This AGREEMENT shall be interpreted and governed by the laws of the State of
California.
14. This AGREEMENT constitutes the entire understanding between the parties with
respect to the subject matter herein.
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IN WITNESS WHEREOF, the parties hereto have caused this AGREEMENT to be
executed by their respective officers as of the date stated below.
CITY:
[INSERT CITY NAME]
By:
Name:
Its:
Date:
LACMTA
Los Angeles County Metropolitan Transportation Authority
• By:
ROGERSNOBLE DATE
Chief Executive Officer
Approved as to form:
Raymond G. Fortner, Jr.
County Counsel
By:
DEPUTY
J
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