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HomeMy WebLinkAbout25B - BUS SHELTER AND BUS BENCHREQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: MAY 4, 2009 TITLE: AMENDMENT TO AGREEMENT WITH CLEAR CHANNEL OUTDOOR INC. FOR BUS SHELTER AND BUS BENCH SERVICES CITY RECOMMENDED ACTION CLERK OF COUNCIL USE ONLY: APPROVED ^ As Recommended ^ As Amended ^ Ordinance on 1S` Reading ^ Ordinance on 2"d Reading ^ Implementing Resolution ^ Set Public Hearing For_ CONTINUED TO FILE NUMBER Authorize the City Manager and Clerk of the Council to execute the attached amendment to the agreement with Clear Channel Outdoor Inc., subject to non-substantive changes approved by the City Manager and City Attorney extending the agreement to provide and maintain bus stop shelters and bus benches throughout the City. DISCUSSION The City currently has an agreement with Eller Media (subsequently re- named to Clear Channel Outdoor Inc.) to provide bus shelter and benches throughout the City. The agreement is due to expire in June 2010. The City has approximately 145 bus shelters and 613 bus benches. The bus shelters have advertising on one, two-sided panel at each location. There is no advertising on the bus benches. These shelters and benches provide bus patrons with shelter from the elements, a location visible to the public, a safer environment from criminal activity at night and a location for the disabled and elderly to rest while waiting for the bus. The total annual payment made to the City is currently $672,000. Under the terms of the current agreement the City will receive one additional payment in July. Clear Channel has suffered severe cutbacks in their revenues due to the downturn in the economy and has approached the City with an offer to extend the current agreement for three years under the same terms, 25B-1 Amendment to Agreement With Clear Channel Outdoor Inc. May 4, 2009 Page 2 with a payment reduction in the last year of the existing agreement to $504,000. With the extension the City will also receive payments at this level for the three years covered by the extension. The alternative to the extension is to end the agreement next June and to seek competitive proposals. However, in the current economic climate, the City can expect to receive substantially reduced payments and may be faced with no bidders or Clear Channel as the only bidder. In 2000 the City sought competitive proposals and only two companies responded. The second company that presented a proposal is now out of business. Staff has contacted other cities and the proposal made to Santa Ana will result in higher per-shelter payments than those paid to other cities. Santa Ana has one of the largest bus shelter and bus bench inventories in the County and public transportation remains an important aspect of the community. Based on current circumstances, staff is recommending an amendment to the agreement with Clear Channel Outdoor Inc., extending the agreement for an additional three years. ENVIRONMTNTAL IMPACT There is no environmental impact associated with this action. FISCAL IMPACT With approval of the amendment the City will receive $504,000 in FY 2009-10 through FY 2012-13 in the general fund (account no. 11-01- 5927). APPROVED AS TO FUNDS AND ACCOUNTS: J es G. Ross Francisco Gutierrez ecutive Director Executive Director l~' ublic Works Agency Finance & Mgmt. Services Agencylu 25B-2 FIRST AMENDMENT TO AGREEMENT THIS FIRST AMENDMENT TO AGREEMENT is entered into on May 4, 2009, by and between Clear Channel Outdoor, Inc., a California corporation {"Grantee") and the City of Santa Ana, a charter city and municipal corporation organized and existing under the Constitution and laws of the State of California ("City"). RECITALS: A. The City and Eller Media Company, a Delaware corporation, entered into that certain Agreement A-2000-179, dated December 8, 2000, (hereinafter "said Agreement") by which Grantee was granted the exclusive right to install, operate and maintain bus shelters and bus benches in the City of Santa Ana. B. On July 1, 2001 Eller Media Company completed a name change to Clear Channel Outdoor, Inc. C. In accordance with the terms and conditions of said Agreement, the parties wish to amend the Schedule of Payments and extend the term of said agreement for an additional three-year period. WHEREFORE, in consideration of the covenants contained in said Agreement, and subject to all the terms and conditions of said Agreement, except those amended in this First Amendment to Agreement, the parties agree as follows: 1. Section 2, TERM OF AGREEMENT, shall be amended to extend the term for an additional three year period, to expire on June 30, 2013, unless said Agreement is terminated earlier, pursuant to the provisions of said Agreement, or otherwise according to law. 2. Section 3, COMPENSATION TO CITY, shall be amended by reducing the annual payment amount set forth in the annual Schedule of Payments, Attachment A to said Agreement, and extending the payment schedule for an additional three years. Said Annual Payment shall be reduced from $672,000 to $504,000 for the 2009-2010 Contract Year. Grantee shall pay to the City annual payments in the amount of $504,000 for each of the three succeeding fiscal Contract Years, including 2010/2011 through 1012/2013. 3. Except as hereinabove amended, all terms and conditions of said Agreement shall remain in full force and effect. // 25B-3 IN WITNESS WHEREOF, the parties hereto have executed this First Amendment to Agreement on the date and year first written above. ATTEST: PATRICIA E. HEALY Clerk of the Council APPROVED AS TO FORM: JOSEPH W.FLETCHER City Attorney By: Laura Sheedy Assistant City Attorney CITY OF SANTA ANA DAVID N. REAM City Manager CLEAR CHANNEL OUTDOOR, INC. Greg McGrath President, Southern California Division 25B-4