Item No. 4.
| MEETING DATE: 11/16/2020 |
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| TO: | HONORABLE CHAIR AND DIRECTORS |
| FROM: | JIM SADRO, EXECUTIVE DIRECTOR By: Miranda Cole-Corona, Housing and Economic Dev Manager |
| SUBJECT: | APPROVE AND AUTHORIZE THE EXECUTIVE DIRECTOR TO EXECUTE A FIVE-YEAR AGREEMENT WITH AUGUSTA COMMUNITIES, LLC, FOR ASSET MANAGEMENT, PROPERTY MANAGEMENT, AND MANUFACTURED HOUSING CONSULTING FOR PARK LA HABRA MOBILE HOMES AND VIEW PARK MOBILE HOME ESTATES LOCATED AT 1731 AND 1750 WEST LAMBERT ROAD |
RECOMMENDATION:
That the City of La Habra Housing Authority approve and authorize the Executive Director to execute a five-year agreement with Augusta Communities, LLC, (Augusta) for asset management, property management, and manufactured housing consulting services for Park La Habra Mobile Homes and View Park Mobile Home Estates located at 1731 and 1750 West Lambert Road.
DISCUSSION:
On October 1, 2018, the La Habra Housing Authority (Housing Authority) entered into a thirteen-month agreement with Augusta to provide asset and on-site property management for the two mobile home parks owned by the Housing Authority, Park La Habra Mobile Homes and View Park Mobile Homes Estates. On November 4, 2019, the Housing Authority entered into a new one-year agreement with Augusta to continue asset and property management services. The 2018 and 2019 agreements allowed for uninterrupted management services at the two mobile home parks.
La Habra Ordinance No. 1740 outlines the purchasing requirement for goods and services. Subject to a few exceptions, this ordinance requires that goods and services being acquired by the City go through a bidding process. Typically, the Housing Authority would conduct a Request for Proposals (RFP) for mobile home park management services before entering into a long term contract for services; however, due to the unique complexities of operating multiple mobile home parks and the high level of quality service that has been provided by Augusta since they have been in place, staff is recommending waiving the bidding requirement and entering into a long term agreement with Augusta on a negotiated basis.
Pursuant to Section 4.20.080 B of Ordinance No. 1740, exceptions to bidding requirements for Purchase of Service include instances in which "[a] service firm has established such a successful past history of work with the City that it is clearly in the public interest not to negotiate with any other source." Staff believes that Augusta highly effective track record of managing the Housing Authority's mobile home properties since 2018 meets this exemption and that negotiating to secure a long term management agreement is in the best interest of the public, the Housing Authority, and the residents at the two mobile home parks.
Prior to entering into the October 2018 agreement with Augusta, Housing Authority staff and members of the City Council were dealing with a variety of tenant-related issues and complaints about the prior property management firm. Staff fielded complaints from tenants regarding discrimination and favoritism, as well as a host of complaints about mass evictions, some tenants being allowed to pay rent late, and a general lack of transparency and communication.
Since Augusta was hired by the Housing Authority to provide park management services, the situation at the two parks have vastly improved. There is now an open line of communication between Augusta and its subcontractor, Les Frames, who provide day-to-day on-site property management services at the two mobile home parks. Augusta has also developed and implemented the following management practices to improve operations:
La Habra Ordinance No. 1740 outlines the purchasing requirement for goods and services. Subject to a few exceptions, this ordinance requires that goods and services being acquired by the City go through a bidding process. Typically, the Housing Authority would conduct a Request for Proposals (RFP) for mobile home park management services before entering into a long term contract for services; however, due to the unique complexities of operating multiple mobile home parks and the high level of quality service that has been provided by Augusta since they have been in place, staff is recommending waiving the bidding requirement and entering into a long term agreement with Augusta on a negotiated basis.
Pursuant to Section 4.20.080 B of Ordinance No. 1740, exceptions to bidding requirements for Purchase of Service include instances in which "[a] service firm has established such a successful past history of work with the City that it is clearly in the public interest not to negotiate with any other source." Staff believes that Augusta highly effective track record of managing the Housing Authority's mobile home properties since 2018 meets this exemption and that negotiating to secure a long term management agreement is in the best interest of the public, the Housing Authority, and the residents at the two mobile home parks.
Prior to entering into the October 2018 agreement with Augusta, Housing Authority staff and members of the City Council were dealing with a variety of tenant-related issues and complaints about the prior property management firm. Staff fielded complaints from tenants regarding discrimination and favoritism, as well as a host of complaints about mass evictions, some tenants being allowed to pay rent late, and a general lack of transparency and communication.
Since Augusta was hired by the Housing Authority to provide park management services, the situation at the two parks have vastly improved. There is now an open line of communication between Augusta and its subcontractor, Les Frames, who provide day-to-day on-site property management services at the two mobile home parks. Augusta has also developed and implemented the following management practices to improve operations:
- Regular updates are provided to staff on late rent payments, incidents in the park that have the potential to cause injury or liability claims against the Authority and/or the City, disputes between tenants, potential eviction filings and any other issues or concerns that may trigger a tenant to contact Housing Authority staff;
- Augusta has instituted a multi-level complaint system that allows tenants to speak freely with multiple people about issues and complaints and provide park managers an opportunity to try to reach resolution before tenants contact Housing Authority staff with their concerns;
- Monthly Asset reports that outline revenues and expenditures, as well as updates on maintenance and quality of life issues, along with tenant related issues, that happened during the month;
- Augusta and Housing Authority staff meet regularly via conference call or in-person meetings to provide updates on projects, tenant issues and suggested programs and protocol that can be put in place to assist with operations in the mobile home parks;
- Augusta regularly provides suggestions on how to better utilize assets, such as informing Housing Authority staff of opportunities to purchase units that are available for sale within the mobile home parks, and to allow those units to be repaired or replaced at a lower cost than a third party would be able to provide. This allows the units to then be sold or rented at affordable prices; and
- Augusta is working with Housing Authority staff to collect and verify income status of tenants living in the mobile home parks to ensure the Authority meets the required percentage of low-income households.
In addition, Augusta has worked closely with Housing Authority staff and tenants during the coronavirus pandemic, keeping residents informed of best practices that can help slow the spread of COVID-19. Staff has received no complaints during the pandemic about manager's willingness to work with tenants on unpaid rent. Augusta has adopted a management policy that allows tenants experiencing difficulties related to COVID-19 to pay back rent over several months so that rent can still be affordable and protect residents from possible eviction for lack of payment. This approach has led to fewer late payments and fewer evictions in the mobile home parks. Augusta recognizes the uniqueness of the Housing Authority's mobile home parks and strives to develop resident focused communities with the hopes of providing quality living environments that will result in long-term stable revenue.
Should the Housing Authority Directors decided not to approve a negotiated five-year agreement with Augusta at this time, staff would recommend that the Authority approve a six-month extension to the current agreement with Augusta so that staff can prepare and release a Request for Proposals soliciting proposals for asset management, property management and manufacturing housing consultation. Once proposals are received, staff would conduct an evaluation process, negotiate with prospective firms and then bring back to the Authority a recommendation and potential agreement with a firm for management of the mobile home parks.
Should the Housing Authority Directors decided not to approve a negotiated five-year agreement with Augusta at this time, staff would recommend that the Authority approve a six-month extension to the current agreement with Augusta so that staff can prepare and release a Request for Proposals soliciting proposals for asset management, property management and manufacturing housing consultation. Once proposals are received, staff would conduct an evaluation process, negotiate with prospective firms and then bring back to the Authority a recommendation and potential agreement with a firm for management of the mobile home parks.
FISCAL IMPACT/SOURCE OF FUNDING:
If approved, the cost of this agreement will not exceed $470,000 per year, for a total of no more than $2,350,000, over the proposed five-year term. The cost of the first year will not exceed $455,851. Contract costs will be adjusted annually beginning in November 2021 by the percentage change in the Consumer Price Index. After negotiating with Augusta on their proposed fees, staff was able to secure a five percent decrease in costs compared to their current annual agreement. The rent revenues generated by both mobile home parks are sufficient to fund the cost of this agreement.
GENERAL PLAN RELEVANCE:
H.3.3-Support and Participate in Housing Programs
Attachments
- Augusta 5-Yr Agreement
- Proposal Scope of Work and Fees
- Les Frames Agreement
- COI
- Work Comp
- AI Endorsement
- Primary Wording End.