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Home My WebLink About1999-264 RESOLUTION NO. 1999-264 2 3 RESOLUTION OF THE MAYOR AND COMMON COUNCIL (1) APPROVING AND AUTHORIZING THE RE-PROGRAMMING OF COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) FUNDS IN THE AMOUNT OF $532,977 (2) THE REALLOCATION OF CDBG FUNDS TO THE PROJECTS AND PROGRAMS CONTAINED IN SECTION 2 OF THIS STAFF REPORT; (3) AMENDMENTS TO THE CITY'S FIVE -YEAR CONSOLIDATED PLAN (1995-2000) AS PROVIDED HEREIN AND (4) EXECUTION OF A STANDARD CDBG AGREEMENT WITH COMMUNITY INVESTMENT CORPORATION (CIC) ($250,000) AND SMALL BUSINESS DEVELOPMENT CORPORATION (SBDC) ($20,000) BY THE MAYOR, AS PREPARED AND APPROVED BY THE CITY ATTORNEY 4 5 6 7 8 9 10 11 SECTION 1. That the Mayor and Common Council hereby approve the reprogramming of CDBG funds in the amount of $532,977 to the following categories: (1) Community 12 13 Investment Corporation (CIC) ($250,000); Small Business Development Center (SBDC) ($20,000); City's Demolition Program ($200,000); Modification to Carousel Mall Parking Structure ("ADA Improvements") ($40,000); and General Contingency Fund ($22,977), and 14 15 16 further authorize amendments to the City's Five-Year Consolidated Plan (1995-2000). 17 SECTION 2. That the Mayor is hereby authorized to execute the CDBG Agreement(s) 18 between the City of San Bernardino and Community Investment Corporation (CIe) and the City 19 and Small Business Development Corporation (SBDC) as prepared and approved by the City 20 Attorney, a copy of which is on file with the City Clerk, and incorporated herein by reference as though fully set forth at length. 21 22 SECTION 3. The authorization to execute the above referenced Agreements is 23 rescinded if the parties to the Agreements fail to execute them within sixty (60) days of the passage of this Resolution. 24 25 -1- 1999-264 1 RESOLUTION OF THE MAYOR AND COMMON COUNCIL (1) APPROVING AND AUTHORIZING THE RE-PROGRAMMING OF 2 COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) FUNDS IN THE AMOUNT OF $532,977 (2) THE REALLOCATION OF CDBG FUNDS TO 3 THE PROJECTS AND PROGRAMS CONTAINED IN SECTION 2 OF THIS STAFF REPORT; (3) AMENDMENTS TO THE CITY'S FIVE-YEAR 4 CONSOLIDATED PLAN (1995-2000) AS PROVIDED HEREIN AND (4) EXECUTION OF A STANDARD CDBG AGREEMENT WITH 5 COMMUNITY INVESTMENT CORPORATION (CIC) ($250,000) AND SMALL BUSINESS DEVELOPMENT CORPORATION (SBDC) ($20,000) BY 6 THE MAYOR, AS PREPARED AND APPROVED BY THE CITY ATTORNEY 7 8 SECTION 4. The Mayor and City Attorney are authorized to make changes to the Agreements provided the changes are non-substantive in nature, and do not increase the amounts 9 provided herein. 10 /II 11 1/1 12 /II 13 /II 14 /II 15 /II 16 /II 17 /II 18 /II 19 /II 20 /II 21 /II 22 /II 23 /II 24 /II 25 /II 26 /II 27 /II 28 -2- 1999-264 2 RESOLUTION OF THE MAYOR AND COMMON COUNCIL (1) APPROVING AND AUTHORIZING THE RE-PROGRAMMING OF COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) FUNDS IN THE AMOUNT OF $532,977 (2) THE REALLOCATION OF CDBG FUNDS TO THE PROJECTS AND PROGRAMS CONTAINED IN SECTION 2 OF THIS STAFF REPORT; (3) AMENDMENTS TO THE CITY'S FIVE -YEAR CONSOLIDATED PLAN (1995-2000) AS PROVIDED HEREIN AND (4) EXECUTION OF A STANDARD CDBG AGREEMENT WITH COMMUNITY INVESTMENT CORPORATION (CIC) ($250,000) AND SMALL BUSINESS DEVELOPMENT CORPORATION (SBDC) ($20,000) BY THE MAYOR, AS PREPARED AND APPROVED BY THE CITY ATTORNEY 3 4 5 6 7 8 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor and 9 joint Common Council of the City of San Bernardino at a rog..1or meeting thereof, held on the 18th day of October 10 11 , 1999, by the following vote to wit: Council Members: Abstain Ayes Nays Absent 12 13 ESTRADA LIEN MCGINNIS SCHNETZ VACANT - 5th Ward ANDERSON MILLER x --y-- 14 x X X- X 15 16 17 ~~.~ 18 19 The foregoing resolution is hereby approved this /'1-/Jt..uay of October ,1999. 20 21 ~ 22 23 Approved as to form and Legal Content: 24 James F. Penman City Attorney 25 -3- "/ By: 1999-264 CDBG SUB-RECIPIENT AGREEMENT (Economic Development Assistance) BETWEEN THE CITY OF SAN BERNARDINO ECONOMIC DEVELOPMENT AGENCY (EDA) (HOUSING & COMMUNITY DEVELOPMENT DIVISION) And Inland Empire Small Business Development Center (SBDC) 1157 Spruce Street Riverside, California 92507 1999-264 TABLE OF CONTENTS OPERATIVE PROViSiONS.............................................................................................................................................................. 1 1. Scope of SeNices....................................................................... ........................................................................... 1 2. Time of Performance.............................................................................................................................................. ..... 1 3. Compensation and Method of Payment .......................................... .................................................................. 1 4. Compliance with Laws and Assurances ...................................................................................................................... 2 5. Affirmative Action....................................................................................... .................... .......................................... . 2 6. Discrimination.................................................................... ....................... ........................................................... ..... 2 7. Accounting.................................. ..................................... ..................................... ........................................... . 2 8. Budget Section ............................................... ................................... ...................................... ......2 9. Non-Expendable Property ..................................... ..................................................................... ...... 3 10. Expendable Personal Property.................................................................................................................................... 3 11. Purchase or Lease of Non-Expendable Property or Equipment................ ................................................... .3 12. Changes in Grant Allocation........................................................................................................................................ 3 13. Revenue Disclosure Requirement................................. .................................................................... .................. .....4 14. Joint Funding ........................... ........................................ ................ ................... .............................. 4 15. Notices.............................................................. ..................... .. ................. .................................. ...........4 16. Assignment.................................................... .......................................... ..................................... 5 17. Termination and Termination Costs........... ................................................................................. ...... 5 18. Program Income......... ........................................... ....................... ........................................................................... 6 19. Reversion of Assets.................................................. ................ ...........................................................6 20. Fiscal Limitations.................................................. .......................... ........................................................................... 6 21. Use of Funds for Entertainment, Meals or Gifts.... ............................................................................................ 7 22. Release, Indemnification, and Hold Harmless.... ................ ............................................................. .... 7 23. Insurance Requirements............ ..................... .......................... ................................................ .. ... .... 7 24. Conflict of Interest............................................... ............................. ........................ ..... 9 25. Budget Modiflcations .................................... ............................. .............................. .. 9 26. Time of Performance Modifications .......................... ................................. . ......................... .......................... .........9 27. Independent (;{)ntractor..................................... .......................................................................... . 10 28. Amendments; Variations............................................................................................................................................ 10 29. Purchase and Invoice Deadlines ................................ ....................... ................................................................ 10 30. Acquisition of Supplies and Equipment ....... .... .............. ....................... ............................................................ ... 10 31. Program Monitoring ................ ................ ..................................................... .................. ... 11 32. Monthly Progress Reports. ................... .................... ................ ........................... ..... 11 33. Use of Funds ................................................ ................................................................................... ...... 11 34. Religious Proselytizing or Political Activities..... ...................................... ................................................ ..... 11 35. Audits................................................................................................................. ................................. ...... 12 36. Counterparts.................................................. ........................................ ....................................... ................. 13 37 Status of Sub-Recipient......................................... ...................................... ..................................................... ...... 13 38. Exhibits.................................................................. ............................................................................................. 13 39. Exhibit"f". Scope of Work........... ............. ........................... ...........................................................15 1999-264 AGREEMENT This Agreement is entered into this 18th day of October. 1999. by and between the City of San Bernardino, a municipal corporation, hereinafter referred to as "City" and Inland Empire Small Business Development Center, hereinafter referred to as "Sub-Recipient". WITNESSETH WHEREAS, City has entered into a contract with the United States of America through its Department of Housing and Urban Development (HUD) to execute the City's Community Development Block Grant (CDBG) Program under the Housing and Community Development Act of 1974, as amended, hereinafter called the "Act"; and WHEREAS, City and Sub-Recipient have an interest in providing necessary services to and enhancement of the quality of life of its citizens; and WHEREAS, City and Sub-Recipient recognize that the project herein is eligible under HUD regulations; and WHEREAS, City and Sub-Recipient desire to cooperate in the implementation of the program by reason of experience, preparation, organization, staffing, and facilities to provide services for the benefit of low and moderate income persons. NOW, THEREFORE, in consideration of the mutual covenants herein set forth and the mutual benefits to be derived therefrom, the parties agree as follows: OPERATIVE PROVISIONS 1. Scope of Services Sub-Recipient shall perform all the services described in the Scope of Work set forth on Exhibit "1" to this Agreement a copy of which is attached hereto and incorporated herein by this reference. 2. Time of Performance Said services of Sub-Recipient are to commence on October 18, 1999, and shall be completed no later than June 30, 2000. 3. Compensation and Method of Pavment For Performance of such services, City shall pay Sub-Recipient an amount of money not to exceed Twenty Thousand ($20,000) dollars which the Mayor and Common Council approved as part of the Fiscal Year 1999-2000 CDBG budget. Said payment shall constitute full and complete compensation for performance by Sub-Recipient of the Services under this Agreement. Method of payment shall be in the form of a Request for Reimbursement in accordance with the terms and 1 ,----- 1999-264 conditions set forth in this Agreement. All Requests For Reimbursement shall be submitted on a monthly basis in accordance with HUD regulations "Audit Ready". Verifiable written supporting documentation of expenditures for services rendered, plus proof of payment all acceptable to City in the sole discretion of City shall be submitted prior to any payment by City to Sub-Recipient. Supporting statements shall give the total of said expenses and shall also itemize the same in detail conforming to the Budget. After timely receipt of each supporting statement and approval, City will draw a warrant in favor of Sub-Recipient for the total amount of the Request For Reimbursement approved by the City. Requests for Reimbursement shall not be accepted by City unless proper documentation is provided. 4. Compliance with Laws and Assurances Sub-Recipient hereby assures and certifies that it has complied and will continue to comply with the Act and all applicable Federal, State, and Local laws, ordinances, regulations, policies, guidelines, and requirements as they relate to acceptance and use of Federal Funds for this Federally assisted program. This Agreement is subject to all such laws, ordinances, regulations, policies and guidelines, including, without limitation, the Act; Title 24, Code of Federal Regulations, Part 85; Title 24, Code of Regulations, Part 570; and U.S. Office of Management and Budget Circulars applicable including, without limitation, A-87, A-95, A-110, A-122 and A-128. 5. Affirmative Action Sub-Recipient shall make every effort to ensure that all projects funded wholly or in part by HUD CDBG funds shall provide equal employment and career advancement opportunities for minorities and women. In addition, Sub-Recipient shall make every effort to employ residents of the area and shall keep a record of the positions that have been created directly or as a result of this program. 6. Discrimination No person shall, on the grounds of race, sex, creed, color, religion or national origin, be excluded from participating in, be refused the benefits of, or otherwise be subjected to discrimination in any activities, programs, or employment supported by this Agreement. 7. Accountino Sub-Recipient shall establish and maintain on a current basis a adequate accrual accounting system in accordance with generally accepted accounting principles, practices, and standards. 8. Budoet Section No more than the amounts specified under Section 3 Compensation and Method of Payment, shall be spent without prior written approval of the Executive Director 2 1999-264 (the "Director") of the Economic Development Agency, the Administrator of the CDBG Program, or his/her Designee. 9. Non-Expendable Property A record shall be maintained by Sub-Recipient for each item of nonexpendable property acquired for this program with HUD CDBG funds. This record shall be provided to City as well as being available for inspection and audit upon reasonable notice by the City at the request of City. Non-expendable property means tangible personal property having a useful life of more than one (1) year and an acquisition cost of Three Hundred Dollars ($300.00) or more per unit. Sub- Recipient shall not purchase or agree to purchase non-expendable property without the prior written approval from the Housing and Community Development Director or his/her Designee. Upon completion or early termination of this Agreement, City reserves the right to determine the final disposition of said non- expendable property acquired for this program and HUD CDBG funds in compliance with applicable laws and regulations. Said disposition may include, but is not limited to, City taking possession of said non-expendable property. 10. Expendable Personal Propertv Expendable personal property refers to all tangible personal property other than non-expendable personal property. Sub-Recipient shall not purchase or agree to purchase expendable personal property with a unit value of Three Hundred Dollars ($300.00) or more per unit without the prior written approval of the Director or his/her Designee. 11. Purchase or Lease of Non-Expendable Propertv or Eauipment Sub-Recipient shall obtain three documented bids prior to purchasing or leasing any non-expendable personal property or equipment over Three Hundred Dollars ($300.00) in unit value as approved in the Budget. Sub-Recipient shall purchase or lease from the lowest responsive and responsible bidder. All equipment that has a purchase or lease price of over Fifty Dollars ($50.00) in unit value and life expectancy of more than one (1) year shall be properly identified and inventoried and shall be charged at its actual price, deducting all cash discounts, rebates and allowances received by Sub-Recipient. This inventory shall be provided to City as well as being available for inspection and audit upon reasonable notice by the City at the request of City. 12. Chanaes in Grant Allocation City reserves the right to reduce the grant allocation when City's fiscal monitoring indicates that Sub-Recipient's rate of expenditure will result in unspent funds at the end of the program year. Changes in the grant allocation will be done after consultation with Sub-Recipient. Such changes shall be incorporated into this Agreement by written amendments. 3 1999-264 13. Revenue Disclosure Reauirement By its execution of this Agreement, Sub-Recipient certifies that it has previously filed with the City of San Bernardino, Economic Development Agency (the "Agency"), a written statement listing all revenue received, or expected to be received, by Sub-Recipient from Federal, State, City and County, and from other governmental agencies, and applied or expected to offset, in whole or in part, any of the costs incurred by Sub-Recipient in conducting current or prospective projects or business activities, including, but not limited to, the project or business activity which is the subject of this Agreement. Such statement shall reflect the name and a description of such project, the dollar amount of funding provided, or to be provided, by each and every governmental agency to each such project or business activity, and the full name and address of each such governmental agency. During the term of this Agreement, Sub-Recipient shall prepare and file a similar written statement each time it receives funding from any governmental agency which is additional to that revenue disclosed in Sub-Recipient's initial revenue disclosure statement hereunder. Such statement shall be filed with the Agency, within fifteen (15) calendar days following receipt of such additional funding. Sub-Recipient shall make available for inspection and audit by City/Agency's representatives, upon request, at any time or times during the duration of this Agreement and during a period of five (5) years thereafter, all of its books and records relating to the operation by it of each project or business activity which is funded in whole or in part with governmental monies, whether or not such monies are received through City. All such books and records shall be maintained by Sub-Recipient at their designated business location. Failure to comply with the requirements of this section of the Agreement shall constitute a material breach of this Agreement upon which City may, among its other remedies, and without limitation, cancel, terminate, or suspend this Agreement. 14. Joint Fundina For programs in which there are sources of funds from the private sector in addition to HUD CDBG funds, Sub-Recipient shall provide proof of such funding. City shall not pay for any services provided by Sub-Recipient which are funded by other sources. All restrictions and/or requirements provided in this Agreement relative to accounting, budgeting, and reporting, apply to the total program regardless of funding sources. 15. Notices All notices herein required shall be in writing. Notices shall be sent by prepaid First Class Mail to the following Address: To City: Economic Development Agency Attn: Housing & Community Development Director Housing & Community Development Division 201 North "E" Street, Suite 301 San Bernardino, California 92401 4 1999-264 To Sub-Recipient: Inland Center Small Business Development Center 1157 Spruce Street Riverside, California 92507 16. AssiQnment This Agreement is not assignable by Sub-Recipient without the express prior written consent of City, which consent shall be given in City's sole discretion. Any attempt by Sub-Recipient to assign any performance of the terms of this Agreement shall be null and void and shall constitute a material breach of this Agreement upon which the City may, among its other remedies, and without limitation, cancel, terminate or suspend this Agreement. 17. Termination and Termination Costs (a) This Agreement may be terminated at any time by any party upon giving thirty (30) day notice in writing to the other party. The Director or his/her designee is hereby empowered to give said notice. Further, the City may immediately terminate this Agreement upon the termination, suspension, discontinuation or substantial reduction in HUD CDBG funding for the Agreement activity; not withstanding any other provision of this Agreement, if Sub-Recipient materially fails to comply with any term of this Agreement, or award the subject of this Agreement, whether stated in a Federal statute or regulation, an assurance, in a State plan or obligation, a notice of award, or elsewhere, the awarding agency or City may take anyone or more of the following actions, as appropriate in the circumstances: (i) Temporarily withhold cash payments pending correction of the deficiency by the Sub-Recipient or more severe enforcement action by the awarding agency; (ii) Disallow (that is, deny both use of funds and matching credit for) all or part of the cost of the activity or action not in compliance; (iii) Wholly or partly suspend or terminate the current award for the City's or Sub-Recipient's program; (iv) Withhold further awards for the Program; or (v) Take other remedies that may be legally available. Further, and notwithstanding any other provision of this Agreement, the award may be terminated for convenience in accordance with Title 24, Code of Federal Regulations, Part 85.44. (b) Costs of Sub-Recipient resulting from obligations incurred by the Sub- Recipient during a suspension or after termination of this Agreement are not allowable unless City expressly authorizes them in the Notice of Suspension or Termination or subsequently. Other Sub-Recipient costs 5 1999-264 during suspension or after termination which are necessary and not reasonably avoidable are allowed if: (i) The costs result from obligations which were properly incurred by the Sub-Recipient before the effective date of suspension or termination, are not in anticipation of it, and, in the case of a termination, are noncancellable; and (ii) The costs would be allowable if the award were not suspended or expired normally at the end of the funding period in which the termination takes effect. 18. Prooram Income Any and all program income (as defined at Title 24, code of Federal Regulations, Part 570.500(a)) received by Sub-Recipient during the term of this Agreement shall be immediately returned to City. Any and all program income on hand with Sub-Recipient at the time of the expiration of this Agreement, or received by Sub- Recipient after the expiration of this Agreement, shall be paid to City pursuant to the provisions of Paragraph 19 of this Agreement. 19. Reversion of Assets Upon the expiration or termination of this Agreement, for any reason whatsoever, Sub-Recipient shall forthwith transfer to City, any CDBG funds on hand at the time of such expiration or termination and any accounts receivable attributable to the use of CDBG funds including, without limitation, program income. Further, any real property under the control of Sub-Recipient that was acquired or improved in whole or in part with CDBG funds in excess of $25,000 shall either be: (a) used to meet one of the national objectives set forth in Title 24, Code of Regulations, Section 570.208, or any successor statute, until five (5) years after the expiration or termination of this Agreement, or for such longer period of time as determined to be appropriate by the City in its sole discretion; or (b) disposed of in a manner that results in the City's being reimbursed in the amount of the current fair market value of real property less any portion of the value attributable to expenditures of non-CDBG funds for acquisition of, or improvement to, such real property. 20. Fiscal Limitations HUD may in the future place programmatic or fiscallimitation(s) on CDBG funds not presently anticipated. Accordingly, City reserves the right to revise this Agreement in order to take account of actions affecting HUD program funding. In the event of funding reduction, City may reduce the budget of this Agreement as a whole or as to cost category, and may, at its sole discretion, limit Sub-Recipient's authority to commit and spend funds. Where HUD has directed or requested City to implement a reduction in funding, with respect to funding for this Agreement, the Director or his/her designee may act for City in implementing and effecting such a reduction and in revising the Agreement for such purpose. The Director or his/her designee may act for City in suspending the operation of this Agreement for up to 6 1999-264 sixty (60) days, upon three (3) days written notice to Sub-Recipient of his/her intention to so act. In no event, however, shall any revision made by City affect expenditures and legally binding commitments made by Sub-Recipient before it received notice of such revision, provided that such amounts have been committed in good faith and are otherwise allowable and that such commitments are consistent with HUD cash withdrawal guidelines. 21. Use of Funds for Entertainment. Meals or Gifts Sub-Recipient certifies and agrees that it shall not use funds provided through this Agreement to pay for entertainment, meals, or gifts. 22. Release. Indemnification. and Hold Harmless Sub-Recipient shall defend, release, indemnify and hold the City and Agency, their officers, agents, employees, and volunteers, harmless from and against any loss, liability, claim, or damages that may arise or result from activities of Sub-Recipient, its officers, agents, and employees and, shall, at its own costs, expense and risk, defend any and all legal proceedings that may be brought against City/Agency on any claim, demand, or alleged liability, and shall satisfy any settlement or judgment that may be rendered against any of them arising or resulting from activities of Sub-Recipient, and shall assume liability for any and all direct expense incurred in providing services pursuant to this Agreement and shall assume any and all responsibilities for loss or damage resulting from negligence, injury, illness or disease arising out of the provision of services. Sub-Recipient, however, is obligated to promptly notify City/Agency in writing of any such loss or damage. 23. Insurance Reauirements The Sub-Recipient shall secure and maintain throughout the term of the Agreement the following types of insurance with limits as shown: a. Statutory Worker's Compensation Insurance. Sub-Recipient shall require the carriers of this coverage to waive all rights of subrogation against the City/Agency, their officers, volunteers, employees, contractors and subcontractors. Sub-Recipient shall maintain all California statutory requirements of $1 ,000,000 limit. b. Comprehensive General and Automobile Liability Insurance. Sub-Recipient shall obtain general liability insurance on a per occurrence basis with a combined single limit of one million dollars ($1,000,000); and automobile liability insurance for owned, hired and non-owned vehicles on a per occurrence basis with a combined single limits of one million dollars ($1,000,000). Additional insured endorsements are required for general and automobile liability policy coverage. Additional insured shall be listed as: 7 1999-264 The City of San Bernardino and the Economic Development Agency, their officers, agents, employees and volunteers. c. Other Requirements and Acceptable Proof of Insurance. 1. All insurance coverage must be maintained throughout the duration of this Agreement. 2. Insurance companies must have an A.M. Best Rating of B+VII or better. 3. Policy deductibles must be stated for each coverage. Deductibles greater than $5,000 must include a letter of credit. 4. Acceptable Proof of Insurance: a. ACCORD Certificate of Insurance listing all coverage, limits, deductibles and insurers; and blanket endorsements for all applicable coverage if agent has authority to issue it; or b. Binders of insurance for all coverage. Agents must confirm that policy endorsements have been ordered from the respective insurance companies. Upon issuance, policy endorsements and a corresponding Certificate of Insurance listing all insurers and coverage must be submitted to the City and Agency. NOTE: Insurance binders are only valid for 30 days and may need to be reissued if the policy endorsements are still pending. Binders may be issued for a maximum of three, thirty (30) day periods. Sub-Recipient shall furnish certified copies of all policies and endorsements to the City and Agency, evidencing the insurance coverage above required, five business days prior to the commencement of performance of Services hereunder, which certificates shall provide that such insurance shall not be terminated or expire without thirty (30) day prior written notice to the City and Agency, and shall maintain such insurance from the time Sub-Recipient commences performance of Services hereunder, until the completion of such Services. All policies, with respect to the insurance coverage required above, except for the worker's compensation coverage, shall contain additional insured endorsements naming the City and Agency, and their officers, agents, employees and volunteers as additional name insured, with respect to liabilities arising out of the performance of Services hereunder. 8 1999-264 24. Conflict of Interest Sub-Recipient, its agents and employees shall comply with all applicable Federal, State, County and City laws and regulations governing conflict of interest. To this end, Sub-Recipient will make available or shall provide copies of all applicable Federal, State, County and City laws and regulations governing conflict of interest, to its agents and employees, and shall furnish to City or Agency, prior to execution of this Agreement, a written list of all current or proposed subgrantees/subcontractors, vendors, and personal service providers, including subsidiaries. This list may be limited to those subgrantees/subcontractors, vendors or personal service providers, including subsidiaries - which will receive Ten Thousand Dollars ($10,000) or more during the term of this Agreement. Such list shall include the names, addresses, telephone numbers and identification of principal parties and description of services to be provided. During term of this Agreement, Sub-Recipient shall notify City and Agency in writing of any change in the list within fifteen (15) days of any change. 25. Budaet Modifications City may grant budget modifications to this Agreement for the movement of funds within the budget categories identified in Exhibit "I" when such modifications: a. Do not exceed $10,000 per budget cost category; b. Are specifically requested by City; c. Do not alter the amount of compensation subject to or under this Agreement; d. Will not change the project goals or scope of services;. e. Are in the best interests of City and Sub-Recipient in performing the scope of services under this Agreement; and f. Related to salaries, are in accordance with applicable salary ordinances or laws. 26. Time of Performance Modifications City may grant time of performance modifications to this Agreement when such modifications: a. In aggregate do not exceed twelve (12) calendar months; b. Are specifically requested by City; c. Will not change the project goals or scope of services; d. Are in the best interest of City and Sub-Recipient in performing the scope of services under this Agreement; and 9 1999-264 e. Do not alter the amount of compensation under this Agreement. 27. Independent Contractor The parties hereto in the performance of this Agreement will be acting in the independent capacity and not as agents, employees, partners, joint ventures, or associates of one another. The employees or agents of one party shall not be deemed or construed to be the agent or employees of the other party for any purpose whatsoever. 28. Amendments: Variations This writing with attachments, embodies the whole of the Agreement of the parties hereto. There are no oral Agreements not contained herein. Except as herein provided, addition or variation of the terms of this Agreement shall not be valid unless made in the form of a written amendment to this Agreement formally approved and executed by all parties. 29. Purchase and Invoice Deadlines Purchase of equipment and property, other than supplies, shall be completed before the last three (3) months of the Agreement period and all equipment bills are to be paid before the last two (2) months of this period. No property or equipment, other than supplies, may be purchased during the final three (3) months of the Agreement. Sub-recipient shall complete all purchases of supplies before the last two (2) months of the Agreement and shall pay all supply bills before the final month of the Agreement. Invoices which have not been received by the Agency within sixty (60) days after the Agreement termination date shall not be honored. Exceptions to these limitations require prior written approval by City and Agency, or its designee. 30. Acauisition of Supplies and Eauipment Following approval by City for necessary supplies and equipment for Agreement performance, Sub-Recipient may purchase from a related agency/organization only if: (a) Prior authorization is obtained in writing from City; (b) No more than charges for reimbursement costs are made and no less than minimum specifications are met as provided in writing by City; (c) A community related benefit is derived from such Sub-Recipient related acquisition; and (d) No conflict of interest or private gain accrues to Sub-Recipient or its employees, agents or officers. 10 1999-264 31. Proaram Monitorina City will monitor Sub-Recipient in the performance of this Agreement. Sub- Recipient shall maintain such property, personnel, financial and other records and accounts as are considered necessary by HUD, and City, to assure proper accounting for all CDBG funds authorized under this Agreement. Sub-Recipient will permit on-site inspection by City or Agency and HUD representatives, and ensure that its employees and board members furnish such information, as in the judgment of City and HUD, may be relevant to a question of compliance with contractual conditions and HUD directives, or the effectiveness, legality, and achievements of the program. All Sub-Recipient records, with the exception of confidential client information, shall be made available to representatives of City and appropriate Federal Agencies. Sub-Recipient will maintain a copy of the Income Qualification Statement for each client served. The Director or his/her designee will conduct periodic program progress reviews. These reviews will focus on the extent to which the planned program has been implemented and measurable goals achieved, the effectiveness of program management, and the impact of the program. 32. Monthlv Proaress Reports By the fifth (5th) day of each month, Sub-Recipient shall submit a Monthly Status Report on the progress of the program to the Agency. This report shall conform to the HUD Direct Benefit Form. Totals should reflect monthly and cumulative data of all persons/households assisted under this Agreement. A supporting narrative will also be required, that describes in measurable terms, the accomplishments and activities attained during the reporting month by the Sub-Recipient in meeting the goals described in Exhibit "1". 33. Use of Funds Funds allocated pursuant to this Agreement shall be used exclusively for costs included in Sub-Recipient's program budget. Agreement funds shall not be used as security or to guarantee payments for any non-program obligations, nor as loans for non-program activities. All Bank Accounts for Sub-Recipient shall be non-interest bearing. 34. Reliaious Proselvtizina or Political Activities Sub-Recipient agrees that it will not perform or permit any religious proselytizing or political activities in connection with the performance of this Agreement. Funds under this Agreement will be used exclusively for performance of the services required under this Agreement and no funds shall be used to promote any religious or political activities. In addition to, and not in substitution for, other provisions of this Agreement regarding the provision of public services with CDBG funds, pursuant to Title 1 of the Housing and Community Development Act of 1974, as amended, and provided 11 1999-264 Sub-Recipient is and has qualified to participate in this Agreement as a religious or denominational institution or organization or an organization operated for religious purposes which is supervised or controlled by or in connection with a religious or denominational institution or organization, the Sub-Recipient: a. Represents that it is not, or may not be deemed to be, a religious or denominational institution or organization or an organization operated for religious purposes which is supervised or controlled by or in connection with a religious or denominational institution or organization; b. Agrees that, in connection with such services: (i) It will not discriminate against any employee or applicant for employment on the basis of religion and will not limit employment or give preference in employment to persons on the basis of religion; (ii) It will not discriminate against any person applying for such services on the basis of religion and will not limit such services or give preference to persons on the basis of religion; (iii) It will provide no religious instruction or counseling, conduct no religious worship or services, engage in no religious proselytizing, and exert no other religious influence in the provision of such services; (iv) The funds received under this Agreement shall not be used to construct, rehabilitate, or restore any facility which is owned by the Sub-Recipient and in which the services are to be provided; provided that, minor repairs may be made if such repairs (1) are directly related to the services, (2) are located in a structure used exclusively for non- religious purposes, and (3) constitute in dollar terms only a minor portion of the CDBG expenditure for the services. 35. Audits Sub-Recipient is required to arrange for an independent financial and compliance audit annually for each fiscal year Federal funds are received under this Agreement. An audit may also be conducted by Federal, State, or local funding source agencies as part of the City's audit responsibilities. The results of the independent audit must be submitted to City within thirty (30) days of completion. Within thirty (30) days of the submittal of audit report, Sub-Recipient shall provide a written response to all conditions or findings reported in said audit report. The response must examine each condition or finding and explain a proposed resolution, including a schedule for correcting any deficiency, within six (6) months after receipt of the audit report. The Agency, and its authorized representatives shall, at all times, have access for the purpose of audit or inspection to any and all books, documents, papers, records, property, and premises of Sub-Recipient, whose staff will cooperate fully with authorized auditors when they conduct audits and examinations of Sub-Recipient's program. If indications of misappropriation or misapplication of the funds of this Agreement cause City to require a special audit, 12 1999-264 the cost will be encumbered and deducted from this Agreement budget. Should the special audit confirm misappropriation or misapplication of funds, Sub- Recipient shall reimburse City. In the event City uses the judicial system to recover funds, Sub-Recipient shall reimburse City legal fees and court costs in addition to awards. The costs, salary and expenses of the City Attorney and members of his office in enforcing this Agreement on behalf of the City and Agency shall be considered as "legal fees" for the purposes of this paragraph. 36. Counterparts This Agreement may be executed in counterparts. When executed, each counterpart shall be deemed an original, irrespective of date of execution. Said counterparts shall together constitute one and the same Agreement. 37. Status of Sub-Recipient This Agreement shall not become effective until such time as the Director or his/her Designee submits to Sub-Recipient written notice that Sub-Recipient is an eligible Sub-Recipient ("Eligible Sub-Recipient") as defined in Title 24, Code of Federal Regulations, Section 570.204(c). Sub-Recipient represents and warrants that once recognized as an Eligible Sub-Recipient, it will take any and all necessary actions to remain an Eligible Sub-Recipient. Further, in this regard, in the event Sub-Recipient no longer qualifies as an Eligible Sub-recipient, it shall forthwith notify City in writing of such lapse of qualification. 38. Exhibits The Exhibit "I" to this Agreement is an integral part of this agreement and has been incorporated herein. 11// lIlt 11// lIlt lIlt //11 lIlt /11/ 11// /11/ 13 1999-264 IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of the day and year first written above. CITY OF SAN BERNARDINO A Municipal Corporation SUB-RECIPIENT '\^J~cidJ(jOJ ATTEST: &~.l~L J;;, ~ Rach lark, City Clerk Approved as to Form and Legal Content: James F. Penman, City Attorney .i 14 1999-264 EXHIBIT I Scooe of Work The Sub-Recipient shall use the grant proceeds granted under this Agreement to provide comprehensive technical assistance to existing and aspiring small business owners in retail, wholesale, manufacturing, service and construction type businesses within the City of San Bernardino. The Sub-Recipient shall provide general and financial management, business environmental assistance, international trade and government procurement, and small business innovative research assistance, etc. The EDA will provide office space to Sub-Recipient on an in-kind basis as part of the partnership between Sub-Recipient and the EDA. The office will be staffed by a Business Consultant from Sub-Recipient up to 12 hours per week. The Sub-Recipient's office days are on Tuesday morning and all day Wednesday of each week. On an as needed basis, Sub-Recipient will meet with San Bernardino businesses at their place of business. 15 1999-264 CDBG SUB-RECIPIENT AGREEMENT (Economic Development Micro Business Loan Program) BETWEEN THE CITY OF SAN BERNARDINO ECONOMIC DEVELOPMENT AGENCY (EDA) (HOUSING & COMMUNITY DEVELOPMENT DIVISION) And Community Investment Corporation (CIC) 4324 Latham Street, Suite 100 Riverside, California 92501 1999-264 TABLE OF CONTENTS OPERATIVE PROViSiONS..................................................................................2 1. Award of Funds...................................................................................2 2. Scope of Services ...............................................................................2 3. Time of Performance .......................................................................... 2 4. Term of Agreement............................................................................. 2 5. Payment of Funds............................................................................... 3 6. Personnel............................................................................................ 4 7. Independent Contractor ...................................................................... 4 8. Insurance............................................................................................ 5 9. Termination of Agreement ..................................................................6 10. Default............................................................................................... 7 11. Assignment ........................................................................................ 7 12. Amendment or Variations .................................................................. 7 13. Right of Entry ..................................................................................... 8 14. Permits............................................................................................... 8 15. Release, Indemnification and Hold Harmless .................................... 8 16. Attorney Fees..................................................................................... 8 17. Compliance with Laws ....................................................................... 8 18. Interest of Officials and Employees.................................................... 9 19. Nondiscrimination ............................................................................ 10 20. Americans with Disabilites Acts ....................................................... 10 21. Equal Employment Opportunity and Section 3 Compliance............. 11 22. Certification of Nonsegregated Facilities.......................................... 11 23. Political Activity ................................................................................11 24. Records and Administration ............................................................. 11 25. Entire Agreement ............................................................................. 13 26. Notices............................................................................................. 13 27. General............................................................................................ 13 28. Exhibit "I" - Scope of Services........................................................ 15 [n ________ 1999-264 AGREEMENT This Agreement is entered into this 18th day of October . 199!l by and between the City of San Bernardino, a municipal corporation, hereinafter referred to as "City" and Community Investment Corporation, a community based California non-profit corporation, hereinafter referred to as "CIC", WITNESSETH WHEREAS, City has been awarded by the United States Department of Housing and Urban Development (HUD) a Community Development Block Grant (CDBG) pursuant to Title 42, U.S.C. Sections 5301 et seq" and Title 24 C.F.R., Part 570 that specifies certain moneys are to be utilized for economic development to assist private and public, non-profit and for-profit entities; and WHEREAS, Subsection (23) of Section 5305 of Title 42, U.S,C. expressly allows Community Development Block Grant funds to be utilized for the expansion of economic opportunities by providing credit, including loan guarantees and establishing revolving loan funds for the establishment, stabilization and expansion of microenterprises; and WHEREAS, City has approved Community Development Block Grant funds for economic development activities to assist business concerns which qualify as microenterprises, which are defined as for-profit entities with five or fewer employees, one or more of whom owns the business, or for businesses in which at least 51 % of the jobs will be available to low and moderate income persons to encourage employment opportunities for low and moderate income persons; and WHEREAS, City desires to obtain technical assistance for the implementation of a Micro Business Loan Program, including the review and evaluation of all applications submitted by individuals requesting loans from this program and the funding and loan repayment thereof; and WHEREAS, the CIC is established to serve the needs of the small business community within the County and City of San Bernardino by promoting new job opportunities and by assisting in the development of small businesses; and WHEREAS, the CIC will market the Micro Business Loan Program throughout the City of San Bernardino, with priority to designated CDBG areas and redevelopment project areas, giving priority to applicants within those areas. NOW, THEREFORE, in consideration of the mutual covenants herein set forth and the mutual benefits to be derived therefrom, the parties agree as follows: 1 1999-264 OPERATIVE PROVISIONS 1. Award of Funds City agrees to award CDBG funds to CIC in the amount of two hundred fifty thousand dollars ($250,000) to be used to operate City's Micro Business Loan Program, principally as follows: $25,000 for providing mentoring and coaching assistance to inquirers, applicants and borrowers and other program participants, including loan portfolio management and counseling; $37,500 for providing administrative services as described in the Scope of Services herein and the balance of funds in the amount of $187,500 shall be used as revolving loan funds by CIC to make loans to small businesses and to perform such services as are set forth herein. 2. Scope of Services CIC agrees to provide technical assistance to City to evaluate small businesses located within the City of San Bernardino for their eligibility for loan funds through City's Micro Business Loan Program ("the Project"). The Program description and services to be provided by CIC are as set forth in the Scope of Services which is attached hereto as Exhibit "I" and by this reference is incorporated herein. 3. Time of Performance The services to be performed hereunder by the CIC shall be undertaken and completed in such sequence as to assure their expeditious completion and best carry out the purposes of this Agreement. All services required hereunder shall begin upon the execution of this Agreement. 4. Term of Aqreement The term of this Agreement shall begin upon the date of execution of this Agreement. Upon the execution of this Agreement by City, City will distribute the sum of one hundred eighty-seven thousand five hundred dollars ($187,500) of CDBG funds to CIC as provided for on Exhibit "I". These funds will be used by CIC for the making of loans to qualifying San Bernardino businesses pursuant to the provisions of this Agreement. As CIC collects loan repayments for the subject funds, CIC shall continue to loan said funds to qualifying San Bernardino businesses in accordance with the provisions of this Agreement. A complete cycle of the loan funds shall occur when the original principal loan fund amount of $187,500 has been fully loaned and fully repaid. This Agreement will continue for one cycle of the loan fund amount or for a period of seven (7) years, whichever first occurs. Upon mutual written agreement of the parties hereto, this Agreement may be extended for an additional one year period. 2 1999-264 5. Pavment of Funds Payment of CDBG funds to CIC for operations pursuant to this Agreement will be carried out as a budgeted expense not to exceed the amount of $250,000 awarded by City pursuant to this Agreement. Payments will be made by City on the following basis: a. An amount of $187,500 will be distributed by City to CIC for micro business loans. CIC will fund loans as set forth in paragraph 2. Scope of Services. b. City agrees to pay CIC an amount not to exceed $25,000 for providing mentoring and coaching assistance to inquirers, applicants and borrowers and any other qualified participant in the program. These services will be billed by CIC in accordance with an approved billing schedule as set forth in Exhibit "I" which is attached hereto and incorporated herein by this reference. c. City agrees to pay CIC an amount not to exceed $37,500 for providing administrative services, included but not limited to loan serving, and loan portfolio management as described in paragraph 2. Scope of Services. Administrative services will be billed by CIC in accordance with an approved billing schedule as set forth in Exhibit "I" which is attached hereto and incorporated herein by this reference. d. Payments to be made by City will be made within thirty (30) days of the receipt of an invoice for services submitted to City by CIC consistent with this Agreement. Invoices shall be submitted by CIC at such times as are appropriate. Payment will be made in a manner consistent with the standard accounting procedures of City (and/or the EDA). e. In no event will City be held liable for expenses incurred by CIC in excess of the amount of $250,000. f. It is hereby agreed that City may withhold payments to CIC if City makes a determination that CIC has not complied with the terms of this Agreement. g. Notwithstanding any provisions contained in this paragraph 5. Pavment of Funds City reserves the right to: (i) Reduce the payment of funds hereunder; (ii) Terminate this Agreement as provided for herein; 3 1999-264 (iii) Renegotiate the actual levels or payment allocations in the event CIC's rate of expenditures result in unexpended funds at the expiration of this Agreement. (iv) CIC shall establish a special bank account and shall deposit all funds received by CIC from City in that account. The special account may be established on the CIC account books and records as a separate account or a separate bank account may be established. (v) CIC shall maintain said special account in such a manner as to permit the tracing of all funds received by CIC from City to their final disbursement or expenditure and to permit the submittal of such reports as may be required by City concerning such funds. Records shall be maintained to show the distribution of funds to loan accounts and to mentoring and coaching assistance and administrative costs. (vi) CIC shall provide City with regular quarterly reports in a form approved by City beginning three (3) months following the execution of this Agreement. Said reports shall document any and all funds distributed pursuant to this Agreement and shall identify loan funds which have been disbursed, loan funds which remain unexpended, and funds which have been collected as loan repayments. CIC shall maintain any and all documentation to support the information contained in each quarterly report for a period of no less than five (5) years. 6 Personnel CIC represents that it has, or will secure at its own expense, all personnel required to perform the services under this Agreement. All of the services required hereunder will be performed by CIC or under its supervision and all personnel engaged in the work shall be fully qualified to perform such services. 7. Independent Contractor All acts of CIC and all others acting on behalf of CIC relating to the performance of this Agreement, shall be performed as independent contractors and not as agents, officers, or employees of City. CIC, by virtue of this Agreement, has no authority to bind or incur any obligation on behalf of City. CIC has no authority or responsibility to exercise any rights or power vested in City. No agent, officer, or employee of City is to be considered an employee of CIC. It is understood by both CIC and City that this Agreement shall not under any circumstances be construed or considered to create an employer-employee relationship or a joint venture. 4 1999-264 CIC is and at all times during the term of this Agreement shall represent and conduct itself as an independent contractor and not as an employee of City. CIC shall determine the method, details, and means of performing the work and services to be provided by CIC under this Agreement. CIC shall be responsible to City only for the requirements and results specified in this Agreement, and, except as expressly provided in this Agreement, shall not be subjected to City's control with respect to the physical action or activities of CIC in fulfillment of this Agreement. CIC has control over the manner and means of performing the services under this Agreement. CIC is permitted to provide services to others during the same period service is provided to City under this Agreement. If necessary, CIC has the responsibility for employing other persons or firms to assist CIC in fulfilling the terms and obligations under this Agreement. If in the performance of this Agreement any third persons are employed by CIC, such persons shall be entirely and exclusively under the direction, supervision, and control of CIC. All terms of employment including hours, wages, working conditions, discipline, hiring, and discharging or any other term of employment or requirements of law shall be determined by the CIC. It is understood and agreed that as an independent contractor and not an employee of City neither the CIC nor CIC's assigned personnel shall have any entitlement as a City employee, right to act on behalf of City in any capacity whatsoever as an agent, or to bind City to any obligation whatsoever. It is further understood and agreed that CIC must issue W-2 forms or other forms as required by law for income and employment tax purposes for all of CIC's assigned personnel under the terms and conditions of this Agreement. As an independent contractor, CIC hereby indemnifies and holds City harmless from any and all claims that may be made against City based upon any contention by any third party that an employer-employee relationship exists by reason of this Agreement. 8. Insurance It is expressly understood and agreed by CIC that there will be no processing and funding of this Agreement unless and until the following conditions have been fulfilled: a. Insurance. CIC shall procure and maintain during the entire period of this Agreement, at its sole expense, the following minimum insurance: (i) Workers' Compensation Insurance. CIC shall and shall require any lessee or assignee to procure and maintain Workers' Compensation 5 1999-264 Insurance as required by law for its employees to be engaged on the Project and, in case of any work that is contracted out, shall require that the contractor(s) and subcontractor(s) similarly provide Workers' Compensation Insurance for all of their respective employees engaged to work on the Project. CIC shall maintain all California Statutory requirements of $1 ,000,000 limit. (ii) Comprehensive General and Automobile Liability Insurance. CIC shall obtain general liability insurance on a per occurrence basis with a combined single limit of one million dollars ($1,000,000); and automobile liability insurance for owned, hired and non-owned vehicles on a per occurrence basis with a combined single limits of one million dollars ($1,000,000). Additional insured endorsements are required for general and automobile liability policy coverage. (iii) Certificate of Insurance. CIC shall furnish City with Certificates of Insurance showing such coverage as required above is in full force and effect, and that City is named as an additional insured including the Economic Development Agency. Said certificates shall further contain the covenant of the insurance carrier that 30 days written notice shall be given City and Agency prior to cancellation or any change or reduction in coverage of such insurance. 9. Termination of AQreement a. Consultant. CIC may not terminate this Agreement except upon the express written consent of City. b. City. City may terminate this Agreement forthwith for anyone of the following reasons without the consent of CIC: (i) In the event there is a conflict with any federal, state or local law, ordinance, regulation or rule rendering any of the provisions of this Agreement invalid or untenable; or, (ii) In the event the funding from the Department of Housing and Urban Development is terminated or otherwise becomes untenable; or (iii) In the event CIC breaches any provisions of this Agreement. c. Department of Housing and Urban Development. All parties to this Agreement understand that the underlying grant may be terminated for cause by the Department of Housing and Urban Development at any time. Upon such occurrence, this Agreement may terminate. 6 1999-264 d. Effect of Termination. If this Agreement is terminated for any reason, City shall not be obligated to advance, payor disburse any funds from its General Funds or any alternate source to begin, maintain, continue or complete the Program. Neither shall City be responsible for any injury or damage as a result of any termination. In the event of termination, City shall be under no responsibility to continue under the terms of this Agreement, but CIC shall remain liable for any and all funds disbursed to it pursuant to this Agreement and agrees to indemnify and hold City /Agency harmless for any damage incurred as a result of any termination pursuant to this paragraph. 10. Default Any violation of the terms of this Agreement, any failure to comply with the terms of this Agreement or any refusal to accept Conditions imposed by the Department of Housing and Urban Development shall be considered a default under this Agreement and all remedies, legal or equitable, to cure such default will apply, including, but not limited to, a declaration that all grant funds disbursed are immediately due and repayable, or an injunction, or the appointment of a receiver; provided, however, that no provision of this Agreement (or any agreement entered into pursuant hereto) based upon or included herein as a result of County, State or Federal laws and regulations with respect to the use of the grant proceeds and/or the operation of the facility, regardless of the language of such provision, shall not be deemed breached by CIC unless CIC is first given notice and a hearing before a court or other tribunal of competent jurisdiction, and such court or other tribunal determines that such laws or regulations have not been complied with. 11. Assiqnment Except for the assignment of collection services in the course of this Agreement, neither this Agreement nor any clause or provision contained herein may be assigned, transferred or released without the express written consent of City prior to the completion or termination of this Agreement. CIC may assign collections services for the loan funds with the prior written consent of the Economic Development Agency, Executive Director, the Administrator of the CDBG Program, which consent shall not be unreasonably withheld. 12. Amendments or Variations No part of this agreement may be modified, altered, amended, waived or changed without the express written consent of all parties, with the modification, alteration, amendment, waiver or change in writing and subscribed to by all parties to this Agreement. 7 1999-264 13. Riqht of Entrv City, and its designated representative or agent are authorized to enter CIC's business subject to this Agreement upon reasonable notice for any purpose necessary for the implementation of this Agreement. 14. Permits Nothing in this Agreement shall absolve CIC from the requirement of obtaining all necessary permits and other documents necessary from any public entity, including City. All costs and fees in obtaining these permits and other documents are not waived ad shall be the sole expense and liability of CIC. Nothing contained herein shall entitle CIC to any preference or guarantee that any or all permits will be issued. 15. Release. Indemnification and Hold Harmless CIC shall defend, release, indemnify and hold City and Agency, their officers, agents, employees, and volunteers, harmless from and against any loss, liability, claim or damages that may arise or result from activities of CIC, its officers, agents, and employees and, shall, at its own costs, expense and risk, defend any and all legal proceedings that may be brought against City/Agency on any claim, demand, or alleged liability, and shall satisfy any settlement or judgement that may be rendered against any of them arising or resulting from activities of CIC, and shall assume liability for any and all direct expense incurred in providing services pursuant to this Agreement and shall assume any and all responsibilities for loss or damage resulting from negligence, injury, illness or disease arising out of the provision of services. CIC, however, is obligated to promptly notify City/Agency in writing of any such loss or damage. 16. Attornev Fees If any action is brought to enforce the provisions of this Agreement, the prevailing party shall be entitled to an award of reasonable attorney fees, costs and necessary disbursements. The costs, salary and expenses of the City Attorney and members of his office in enforcing this contract on behalf of City/Agency shall be considered as "attorney's fees" for the purpose of this paragraph. 17. Compliance with Laws a. CIC agrees to obey the provisions of the Housing and Community Development Act of 1974 and any amendments thereto, the Federal regulations and guidelines now or hereafter enacted pursuant to the Housing and Community Development Act of 1974, the terms of the Agreement now or hereafter in effect, the regulations now or hereafter enacted by City to facilitate the administration of this Agreement. CIC is 8 1999-264 familiar with the statutes, regulations and guidelines governing the use of Community Development Block Grant funds pursuant to 24 C.F.R., Part 570 (Handbook 6500) and will bear principal responsibility for determining their applicability to the completion of the Program. b. CIC further agrees to obey the provisions of any and all Federal, State and local statues, laws and ordinances in performing its obligations pursuant to this Agreement. c. CIC shall remain fully obligated under the provisions of this Agreement notwithstanding its designation of any third party or parties for the undertaking of all or any part of the Program with respect to which assistance is being provided under this Agreement. d. CIC will not be deemed to be in violation of this paragraph or any other paragraph of this Agreement deal with Federal, State or local statutes or regulations, unless and until a court or administrative tribunal of competent jurisdiction has made a determination after a noticed hearing that the CIC is in violation of said statutes or regulations. 18. Interest of Officials and Emolovees a. City's Community Development Block grant Agreement with the Department of Housing and Urban Development prohibits any member, officer or employee of City or its designees or agents and any members of the governing body of the locality in which the Program is situated, and any other public official of such locality or localities who exercise any functions or responsibilities with respect to City's Community Development Block Grant Program during his/her tenure or for one year thereafter, from having any interest, direct or indirect, in any contract or subcontract, or the proceeds thereof, for work to be performed in connection with projects assisted with Community Development Block Grant funds. b. CIC agrees that no public official, as described in the preceding paragraph, will have any interest, family, business or other ties, direct or indirect, in this Agreement or any contract or subcontract, or the proceeds thereof, for work to be performed in connection with the Program. c. CIC agrees to include or cause to be included the regulations in paragraphs a and b of this section in every contract or subcontract in connection with the Program. d. No member of or Delegate to the Congress of the United States, and no Resident Commissioner, shall be admitted to any share or part of this Agreement or to any benefit to arise from the same. 9 1999-264 e. The assistance provided under this Agreement shall not be used in the payment of any bonus or commission for the purpose of obtaining Department of Housing and Urban Development approval of the application for such assistance or Department of Housing and Urban Development approval of applications for additional assistance, or any other approval or concurrence of the Department of Housing and Urban Development required under this Agreement, Title I of the Housing ad Community Development Act of 1974 or Department of Housing and Urban Development regulations with respect thereto; provided, however, that reasonable fees for bona fide technical, consultant, managerial or other such services, other than actual solicitation are not hereby prohibited if otherwise eligible as program costs. 19. Nondiscrimination CIC, for itself and its successors and assigns, agrees that this Agreement is subject to Title XI of the Civil Rights Act of 1964 (PUB. L 88-352) and Regulations promulgated by the Department of Housing and Urban Development pursuant thereto, including 24. C.F.R., Part 1 and 24 C.F.R. Section 570.601. Therefore, for all businesses funded in accordance with this Agreement, the following language shall be included in every application for employment, in personnel policies and procedures and shall be posted in employee areas: "No person in the United States shall on the ground of race, color, national origin or sex be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity funded in whole or in party by Federal financial assistance." In addition, in the sale, lease or other transfer of land acquired, cleared or improved with assistance provided under this Agreement, CIC, for itself and its successors and assigns, shall cause or require a covenant running with the land to be inserted in the deed or lease for such transfer prohibiting discrimination upon the basis of race, color, religion, sex or national origin in the sale, lease or rental or in the use or occupancy of such land or any improvement erected or to be erected thereon, and providing that City or its designee and the United States are beneficiaries of and entitled to enforce such covenant. 20. Americans with Disabilities Act Pursuant to the Americans with Disabilities Act and specifically 42 U.S.C. 12132, CIC acknowledges and agrees that in the performance of the Agreement, no qualified individual shall, by reason of a disability, be excluded from participation in or be denied the benefits of the services, programs or activities of the CIC or be subjected to discrimination by the CIC. 10 1999-264 21. Eaual Emplovment Opportunitv and Section 3 Compliance CIC, for itself and its successors and assigns, agrees that the Program will be conducted in accordance with the provisions of this Agreement and Section 570.601 (a) which sets forth the general requirements for Title VI of the Civil Rights Act of 1964 and S 570.602 which sets forth the general requirements for Section 109 of the Act. Together, these provisions prohibit discrimination in any activity funded in whole or in part with funds made available for CDBG funded activities. Section 3 of the Housing and Urban Development Act of 1968 , as amended, 12 U.S.C. Section 1703, requires that to the greatest extent feasible, opportunities for training and employment be given lower income residents of the Program area and contracts for work in connection with the Program be awarded to business concerns which are located in or owned in substantial part by persons residing in the area. Regulations issued pursuant to section 3 are set forth at 24 C.F.R., Part 135. 22. Certification of Nonseareaated Facilities Prior to the award of any federally-assisted funds to the Program, if applicable, CIC shall require the prospective lessee and subsequent lessee to submit a certification that the prospective lessee or subsequent lessee does not and will not maintain any facilities he/she provides for his employees in a segregated manner or permit his/her employees to perform their services at any location under his/her control where segregated facilities are maintained and that he/she will obtain a similar certification prior to the award of any CDBG grant funds. 23. Political Activitv CIC agrees that no Community Development Block Grant funds shall be expended to finance, directly or indirectly, any political activity in contravention of Chapter 15 of Title 5 of the United States Code. CIC agrees that no Community Development Block Grant funds shall be used for publicity or propaganda purposes designed to support or defeat legislation pending before Federal, State or local government. 24. Records and Administration a. CIC agrees to comply with S 85.42 Retention and access requirements for records of Revised OMB Circular A-1 02, and the provisions of S 570.506, as those sections currently exist or as they may be amended prior to the completion or termination of the Program copies of which will be provided at its request. 11 1999-264 b. CIC agrees to maintain such documents, records and accounts, including property purchased with federal funds, personnel and financial records, and submit such financial reports as are required by the Secretary of the Department of Housing and Urban Development to assure a proper accounting for all Program funds as required by the regulations adopted pursuant to the Housing and Community Development Act of 1974. CIC shall establish and maintain a meaningful financial management system that complies with Revised OMS Circular A-1 02 and any amendments thereof. Such a financial management system shall include, but shall not be limited to, the following journals and ledgers: (a) Cash receipt journal; (b) Cash disbursement journal; (C) General ledger; (d) Payroll journal; (e) Fixed assets journal; (f) Project cost accounting journal; (g) Reprogramming journal. All records and documents must be established and maintained in accordance with generally accepted accounting principles. Methods used to determine an assigned cost must conform to generally accepted accounting principles and must not differ substantially from the methods used by CIC to determine costs operations. Grant records will be available for audit purposes to City, and/or Agency, the Department of Housing and Urban Development or the Comptroller General of the United Sates, any authorized representative thereof, and will be retained for five (5) years after completion of the Program pursuant to this Agreement, at which time the documents shall be transmitted to City, and/or Agency. c. For the term of this Agreement, CIC shall and shall require any lessee or assignee to maintain personnel records sufficient to determine compliance with the provisions of Section 23. above. Such records shall be made available to City and/or Agency on reasonable notice, for inspection. d. City/Agency may withhold funds from CIC if City/Agency determines that CIC is not complying with the terms of this Agreement or is not in compliance with the law governing this Agreement. e. CIC shall be accountable to City and Agency for any and all funds expended pursuant to this Agreement by CIC or any officer, employee, agent or representative thereof, whether or not such officer, employee, agent or representative was acting within the scope of his employment. CIC shall repay City the amount of any improperly expended grant funds upon demand. City may retain any property of CIC in City's possession to liquidate the debt. f. CIC agrees that City, Agency and its agent or designee have the right to monitor and supervise the administration of the Program to completion pursuant to this Agreement to ensure compliance with all Federal, State and local statutes, laws, regulations, guidelines and ordinances. 12 1999-264 25. Entire Aareement This Agreement and Exhibits contain the entire Agreement and understanding between the parties. There are no oral understanding, terms, conditions or promises, and no party has relied upon any representation, express or implied, not contained in this Agreement. 26. Notices Any notice required or desired to be served by either party upon the other shall be addressed to the respective parties as set forth below: To City: Economic Development Agency Attn: Executive Director 201 North "E" Street, Suite 301 San Bernardino, California 92401 To Sub-recipient: Community Investment Corporation 4324 Latham Street, Suite 1 00 Riverside, California 92501 Or to such other addresses as from time to time shall be designated in writing by the respective parties. 27. General This Agreement constitutes the sole agreement between the parties. All prior conversations, agreements or representations relating hereto are integrated in this Agreement. No oral agreement, representation or warranty shall be binding upon the parties. ///1 /1/1 /1/1 /1/1 /1/1 /1/1 /1/1 13 Oct-11-99 05:41P Community Investment Corp 909 786 0050 P.03 O,,-lI-U 05;20"" FrOll-SB EDA 8081888413 T-m P 17/22 H61 1999-264 IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of the day and year first written above. CITY OF SAN BERNARDINO A Municipal Corporajion SUB-RECIPIENT I2itJ~ .E(~'I4~;V~ D:rwJo~ ATTEST: ~.J? k. ~ Ra I Claf1(, City CIef1( Approved as to Form and Legal Content: James F. Penman, City Attorney 7~ 14 1999-264 EXHIBIT I Scope of Services INTRODUCTION This proposal is presented to the City of San Bernardino, by Community Investment Corporation, hereinafter referred to as "CIC", a community based California non-profit corporation with its principal place of business at 4324 Latham, Suite 1 00, Riverside, California 92501. 1. PROGRAM DESCRIPTION Name: Micro Business Loan Program, hereinafter referred to as "PROGRAM". Goals: To stimulate the economy and promote new job opportunities by assisting in the development of small business. Activity: Risk: Eligibility: Amount: Use: CITY will make available to CIC grant funds in the amount of $250,000 and more specifically as outlined below: to capitalize a revolving loan fund. The funds will be loaned to business concerns for business purposes based on eligibility. The repayment of the loans will continue to be made available to eligible applicants for the described purposes below: The fund is designed to tolerate a high level of risk. While the fund has a high risk tolerance, loan approvals will be made based on propensity for the assisted business concern to succeed, repay the loan, create jobs and provide benefits to the community (increase in tax base, eliminate blight, spur economic activity). Aggressive underwriting methods, intensive technical assistance during all phases of loan application, project implementation loan payoff and ongoing monitoring of the loan and borrower will enable the fund to tolerate a high level of risk in deciding which requests to fund, ensure that business concerns assisted are successful in their endeavors and a high rate of return for the loan proceeds extended is recognized. New or existing businesses where either the business employs five (5) employees or less and the business owner meets federal income requirements, or 51 % of new hires meet federal income requirements. Up to $25,000. Working capital, equipment, tenant improvements. 15 1999-264 Collateral: Determined through underwriting. Loans may be made range from unsecured, partially secured, to fully secured based on risk. Loan Term: Not to exceed seven (7) years. Location: Loan Approval: assistance. Loan Process: to payoff: The PROGRAM will be marketed through out the City of San Bernardino with a specific campaign in CDBG target and redevelopment project areas. Applications coming from these areas will be given priority for funding over at-large applications. EDA will provide to CIC on an in-kind basis, office space of which CIC will spend approximately 2 days a week in order to provide assistance to local businesses per this Agreement. The following criteria will be utilized to rank applications for financial 1. Project Business Income - Submission of an annualized three year profit and loss projected balance sheet and one year monthly cash flow that supports the applicant's business plan narrative sections. 2. Job Retention or Creation - Submission of a business plan which outlines an operational and marketing plan to build the business and create and/or retain jobs. The business should be one which is conducive to job creation, such as manufacturing, construction, services. 3. Repayment Ability - The cash flow of the business, including past records and projected financial statements, will be analyzed to determine the applicant's ability to repay the loan. 4. Credit Worthiness - The applicant's credit history will be analyzed. 5. Collateral - The value of available assets to secure the loan along with outstanding debts and liens on those assets will be analyzed. The following is a summary of the steps of the process from inquiry 1. Inquiries - CIC will market the PROGRAM as described above on behalf of the CITY directing interested parties to contact CIC (which shall include advertisements, referrals, and dissemination of program brochures). Inquiries will be received and logged by CIC. Each will be carefully screened and a determination made as to the next best step. 2. Preparation - If the Inquirer appears to be a prospect for the PROGRAM, coaching will be provided with the preparation of the 16 1999-264 application and its components (business plan, etc.). During the screening and application process determination for eligibility and possibility of receiving approval will be conducted continuously and the inquirer notified. This will ensure that no more work is performed by any party unnecessarily. 3. Decision - Once the application is completed and recommended by staff for approval (the CIC Loan Officer and the Executive Director review the application during the preparation phase), it is forwarded to the CIC Credit Committee. The Committee is comprised of members of the Board of CIC, community volunteers and an optional representative from the CITY (the CITY may choose a representative to serve on the credit Committee). The CITY representative may vote on loan requests that will be funded with funds from the CITY. Staff prepares a written loan presentation for the Committee members to review. Staff delivers an oral presentation during the Credit Committee meeting. The Credit Committee generally discusses the requests, asks questions and votes whether or not to fund the requests. Applicants are notified and approved requests are prepared for funding. 4. Closing - Based on the type of the loan and collateral used to secure the loan, appropriate documents will be prepared, executed and filed. The loan will be set up for monitoring and collection. 5. Monitoring - The loan will be monitored for repayment, job creation and maintenance of eligibility as required by CDBG, the CITY and CIC. 6. Servicing - The borrower will be monitored for progress. If problems arise mentoring and coaching will be provided to keep the loan arrangement viable. If the loan is defaulted, a work out plan will be developed and implemented. All required reports to all necessary parties will be prepared and delivered. 2. PROGRAM PROCESS CIC will perform administrative services on behalf of the CITY with respect to matters affecting stimulation of local economic development through the implementation of PROGRAM summarized in the outline below: 1. Inform businesses of the availability of business financing from the PROGRAM with priority to CITY approved CDBG target and redevelopment project areas and then at-large; 2. Receive and address inquiries about the PROGRAM; 17 1999-264 3. Providing mentoring and coaching on applying for funds from the PROGRAM; 4. Accept applications from business concerns for financing from and per the guidelines of the PROGRAM; 5. Process, underwrite and recommend action on applications from business concerns for financing from the PROGRAM; 6. Present positively recommended applications for funding to the Credit Committee; 7. Carry out Credit Committee decisions on presented applications, Le., provide decline notices and close approved loans; 8. Monitor, service and collect closed loans; 9. Relend collected loan repayments; 10. Provide mentoring and coaching during all phases of participation in the PROGRAM from inquiry to payoff; 11. Prepare reports required by CDBG, CITY, Federal and State, etc. 12. Ensure that all PROGRAM requirements are met. 13. Cost of Service and use of CDBG Program funds are: $187,500 25,000 37.500 $250,000 3. DOCUMENTATION. REPORTS. INSPECTIONS AND PERFORMANCE EVALUATION a. b. c. Micro Loans Portfolio ManagemenUMentoring & Coaching Program administration/Service delivery 1. Documentation of Expenditures - All expenditures supported by properly executed payrolls, time records, invoices, contract, vouchers, and orders, and any other accounting documents pertaining in whole or in part to the proposed agreement will be clearly identified and readily accessible. CIC will maintain and keep available all such documents for a period of not less than five years from the termination of the Agreement. 18 1999-264 2. Reports - CIC, as such times and in such forms as CITY may require, will furnish CITY such statements, records, data and information as CITY may request pertaining to its performance of services in the Agreement. This will include but not be limited to: A. PROGRAM Progress Reports Form. 3. Inspections - CIC will permit, as necessary, CITY, State or Federal officials to inspect its records and data with respect to all matters covered by the proposed agreement for inspections and audit, which inspection and audit may be made at any time after reasonable notice. 4. Performance Evaluation - CIC will permit CITY, State or Federal officials to monitor, assess or evaluate CIC's performance under the Agreement on at least a monthly basis, said monitoring, assessment or evaluation to include, but not limited to, audits, inspections within the PROGRAM area and interviews with CIC's employees, agents, independent contractors and subcontractors providing the services under the Agreement and recipient thereof. 4. PAYMENT AND DISBURSEMENT OF FUNDS Payments of grant funds to CIC relative to conducting the operations of the Program as described in two herein will be carried out as a budgeted expense not to exceed the approved funds Payments and will be made in accordance with Section 1 and 5 of the Agreement. 5. CREDIT COMMITTEE CIC has a standing credit committee, herein after referred to as "Credit Committee", for the purpose of reviewing and taking action on loan applications submitted to CIC in relation to the PROGRAM. A CITY designated representative may participate on the Credit Committee by attending the portion of the Credit Committee's meetings regarding loan applications to be funded by the CITY, providing information on these applications and voting on these requests. CITY will be provided notices per current protocol. 19