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HomeMy WebLinkAbout2014 CON HA City of National City - Office Space Rental MOU (2)RESOLUTION NO. 2014 — 27 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY AUTHORIZING THE CHAIRMAN TO EXECUTE A MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF NATIONAL CITY AND THE COMMUNITY DEVELOPMENT COMMISSION — HOUSING AUTHORIY OF THE CITY OF NATIONAL CITY FOR THE RENTAL OF OFFICE SPACE WHEREAS, the Community Development Commission -Housing Authority of the City of National City ("CDC -HA) is, and has been, paying the City of National City rent for the office space at the Martin Luther King, Jr. Community Center (the "Community Center"), and paying the City internal service charges and indirect overhead costs for the administration of the Housing Choice Voucher Program (the "Program") through fund transfers; and WHEREAS, the City's external auditors, Pun & McGeady, LLC, performed a single audit on March 11, 2014, and issued a Single Audit Report for the year ending June 30, 2014 (the "Audit Report"); and WHEREAS, in the Schedule of Findings and Questioned Costs, Section III of the Audit Report, the auditors found that there was a lack of documentation clearly delineating the rent fee, which is only for the use of office space occupied by Housing Choice Voucher staff members at the Community Center, from the internal service charges and indirect overhead costs; and WHEREAS, the proposed Memorandum of Understanding sets forth the process by which the CDC -HA transfers funds to the City for rent and other allowable costs, and documents the separate fund transfers from the CDC -HA to the City for rental costs and internal service charges and indirect overhead costs for the administration of the Program. NOW, THEREFORE, BE IT RESOLVED by the Community Development Commission -Housing Authority of the City of National City that the Chairman is hereby authorizes to execute a Memorandum of Understanding to set forth the process by which the Community Development Commission -Housing Authority of the City of National City transfers funds to the City of National City for rent and other allowable costs. The Memorandum of Understanding is on file in the Office of the City Clerk. PASSED and ADOPTED this 21st day of October, 2014. ATTEST: A'PROVED AS O FORM. . Leslie Deese, Secretary audia acitua General Co s: I Passed and adopted by the Community Development Commission — Housing Authority of the City of National City, California, on October 21, 2014 by the following vote, to -wit: Ayes: Boardmembers Cano, Morrison, Natividad, Sotelo-Solis. Nays: None. Absent: Boardmember Rios. Abstain: None. AUTHENTICATED BY: RON MORRISON Chairman, Housing Authority Secretary, Housing Authority By: Deputy I HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of RESOLUTION NO. 2014-27 of the Community Development Commission — Housing Authority of the City of National City, California, passed and adopted on October 21, 2014. Secretary, Housing Authority By: Deputy NOTE TO FILE 10-30-14 IN THE MATTER OF: Resolution of the CDC — Housing Authority of the City of National City authorizing the Chairman to execute a Memorandum of Understanding (MOU) between the City of National City and the CDEC — Housing Authority of the City of National City for the rental of office space. Please note the following: THE FULLY EXECUTED ORIGINAL MOU HAS BEEN FILED WITH CITY COUNCIL RESOLUTION NO. 2014-154 UNDER THE SAME FILE NO. C2014-45 • Only one fully executed original MOU has been provided for both Housing Authority Resolution No. 2014-27 and City Council Resolution No. 2014-154 NTF MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF NATIONAL CITY AND THE COMMUNITY DEVELOPMENT COMMISSION — HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY This Memorandum of Understanding ("MOU") is entered into between the City of National City ("City"), a California municipal corporation, and the Community Development Commission — Housing Authority of the City of National City, a corporate and politic public body. RECITALS A. The City Council of the City of National City established the Community Development Commission of the City of National City (the "CDC") and the Housing Authority of the City of National City pursuant to Ordinance No. 1484, dated October 14, 1975, and vested in the Community Development Commission all the powers, duties and responsibilities of the Redevelopment Agency of the City of National City (the "Redevelopment Agency") and the Housing Authority. The purpose of Ordinance No. 1484 was to enable the CDC to operate and govern the Redevelopment Agency and the Housing Authority under a single board and as a single operating entity. B. Enactment of Part 1.85 of Division 24 of the California Health and Safety Code dissolved all redevelopment agencies, including the Redevelopment Agency, on February 1, 2012. The CDC was not dissolved and the enactment of Part 1.85 did not affect or impair the Housing Authority. C. The City Council designated the Housing Authority to receive the transfer of all of the housing assets, rights, powers, duties, obligations, liabilities and functions previously performed by the Redevelopment Agency upon the dissolution of the Redevelopment Agency, pursuant to Resolutions Nos. 2012-16, passed on January 10, 2012, and 2012-30, passed on January 24, 2012. The CDC acting in its capacity as the Housing Authority of the City of National City is referred to as the CDC -Housing Authority (the "CDC -HA"). D. The CDC -HA receives federal funds from the U.S. Department of Housing and Urban Development ("HUD") to administer the Housing Choice Voucher Program (the "Program"). City staff in the Housing, Grants and Asset Management Department manage the Program. These City staff are housed in the Martin Luther King Jr. Community Center located at 140 East 12th Street, Suite B, in the City of National City (the "Community Center"). The Housing Choice Voucher staff members occupy approximately 1,760 square feet of office space in the Community Center. E. HUD pays the CDC -HA a fee for the costs of administering the Program. F. OMB Circular A-87 (the "Circular") establishes principles and standards for determining costs for Federal awards carried out through grants, including the Program. G. Indirect costs, as described in Section F of Attachment A to the Circular, and rental costs, as described in Section 37 of Attachment B to the Circular, are allowable costs, among many others. H. The City's internal service charges are allocated to each City Department each year. The City's internal service charges are calculated every year and the amount due from each Department may change from year to year. The City's internal service charges include Building Service Charges, Vehicle Services Charges, Insurance Charges, and Information Systems Maintenance Charges. I. Indirect overhead costs consist of central services or support functions shared across Departments. J. The CDC -HA is, and has been, paying the City for rent of the office space at the Community Center and paying the City internal service charges and indirect overhead costs for the administration of the Program through fund transfers. K. The City's external auditors, Pun & McGeady, LLC, performed a single audit pursuant to OMB Circular A-133 and, on March 11, 2014, issued a Single Audit Report for the year ending June 30, 2014 (the "Audit Report"). L. In the Schedule of Findings and Questioned Costs, Section III of the Audit Report, the auditors found that there was a lack of documentation clearly delineating the rent fee from the internal service charges and indirect overhead costs. The rent fee is only for the use of office space occupied by Housing Choice Voucher staff members at the Community Center. M. The purpose of this MOU is to set forth the process by which the CDC -HA transfers funds to the City for rent and other allowable costs pursuant to OMB Circular A-87. Specifically, this MOU will clearly document the separate fund transfers from the CDC -HA to the City for rental costs and internal service charges and indirect overhead costs for the administration of the Program. AGREEMENT 1. Term. The duration of this MOU is for the period of March 11, 2014 through June 30, 2014. 2. The fair market rent for the office space shall be determined based on current local information such as comparable leases of comparable space. 3. The CDC -HA agrees to allow the transfer of $3,366 to the City each month by fund transfer for rent costs. Memorandum of Understanding 2 City of National City and March 11, 2014 — June 30, 2014 CDC -Housing Authority of National City 4. The CDC -HA agrees to allow the separate transfers of its allocation of the internal service charges and indirect overhead costs upon notification by the Director of Finance, or his or her designee, of the amounts of those charges and costs. 5. Any amendment or modification to the terms of this MOU must be in writing and signed by both Parties. 6. This MOU may be terminated by either Party upon thirty -days' written notice to the other Party. 7. This MOU supersedes any prior agreements, negotiations and communications, oral or written, and contains the entire agreement between the Parties. The Parties have executed this MOU on October 21, 2014. CITY OF NATIONAL CITY COMMUNITY DEVELOPMENT COMA — HOUSING AUTHORITY By: Leslie Deese, City Manager APPROVED S TO FORM: doleiv �' , Claudia Gac ua Silva City A .orne on Morrison, Chairman PROVED AS O FORM: dia Gacitua ',ilva General Counsel Memorandum of Understanding 3 City of National City and March 11, 2014 —June 30, 2014 CDC -Housing Authority of National City COMMUNITY DEVELOPMENT COMMISSION - HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY AGENDA STATEMENT MEETING DATE: October 21, 2014 AGENDA ITEM NO. 1.9 ITEM TITLE: Resolution of the Community Development Commission of the City of National City acting in its capacity as the Housing Authority of the City of National City ("CDC -HA") authorizing the Chairman to execute the Memorandum of Understanding between the City of National City and the Community Development Commission — Housing Authority of the City of National City for the rental of office space. PREPARED BY: Javier Carcamo (Ext. 4331) DEPARTMENT: Financein.0 APPROVED BY: � T EXPLANATION: In conducting the FY2013 single audit, the City's auditors, Pun & McGeady, LLC determined, the lack of documentation clearly delineating the nature of the rent fee charged to the Community Development Commission -Housing Authority represented a significant deficiency in internal control as defined in Government Auditing Standards issued by the Comptroller General of the United States. In its response to this finding, the City stated its corrective action would be the execution of a memorandum of understanding for the rental office space. Execution of the Memorandum of Understanding resolves the finding. FINANCIAL STATEMENT: APPROVED: `144.44 ,Cw -" Finance ACCOUNT NO. Acct # 502-419-462-268 Acct # 001-00000-3312 No change from current budget/appropriation. ENVIRONMENTAL REVIEW: This is not a project and, therefore, not subject to environmental review. ORDINANCE: INTRODUCTION: FINAL ADOPTION: STAFF RECOMMENDATION: Adopt the resolution, authorizing the Chairman to execute the Memorandum of Understanding between the City of National City and the Community Development Commission -Housing Authority of the City of National City. BOARD / COMMISSION RECOMMENDATION: NA ATTACHMENTS: 1. Memorandum of Understanding 2. Resolution MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF NATIONAL CITY AND THE COMMUNITY DEVELOPMENT COMMISSION — HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY This Memorandum of Understanding ("MOU") is entered into between the City of National City ("City"), a California municipal corporation, and the Community Development Commission — Housing Authority of the City of National City, a corporate and politic public body. RECITALS A. The City Council of the City of National City established the Community Development Commission of the City of National City (the "CDC") and the Housing Authority of the City of National City pursuant to Ordinance No. 1484, dated October 14, 1975, and vested in the Community Development Commission all the powers, duties and responsibilities of the Redevelopment Agency of the City of National City (the `Redevelopment Agency") and the Housing Authority. The purpose of Ordinance No. 1484 was to enable the CDC to operate and govern the Redevelopment Agency and the Housing Authority under a single board and as a single operating entity. B. Enactment of Part 1.85 of Division 24 of the California Health and Safety Code dissolved all redevelopment agencies, including the Redevelopment Agency, on February 1, 2012. The CDC was not dissolved and the enactment of Part 1.85 did not affect or impair the Housing Authority. C. The City Council designated the Housing Authority to receive the transfer of all of the housing assets, rights, powers, duties, obligations, liabilities and functions previously performed by the Redevelopment Agency upon the dissolution of the Redevelopment Agency, pursuant to Resolutions Nos. 2012-16, passed on January 10, 2012, and 2012-30, passed on January 24, 2012. The CDC acting in its capacity as the Housing Authority of the City of National City is referred to as the CDC -Housing Authority (the "CDC -HA"). D. The CDC -HA receives federal funds from the U.S. Department of Housing and Urban Development ("HUD") to administer the Housing Choice Voucher Program (the "Program"). City staff in the Housing, Grants and Asset Management Department manage the Program. These City staff are housed in the Martin Luther King Jr. Community Center located at 140 East 12th Street, Suite B, in the City of National City (the "Community Center"). The Housing Choice Voucher staff members occupy approximately 1,760 square feet of office space in the Community Center. E. HUD pays the CDC -HA a fee for the costs of administering the Program. 1411.. F. OMB Circular A-87 (the "Circular") establishes principles and standards for determining costs for Federal awards carried out through grants, including the Program. G. Indirect costs, as described in Section F of Attachment A to the Circular, and rental costs, as described in Section 37 of Attachment B to the Circular, are allowable costs, among many others. H. The City's internal service charges are allocated to each City Department each year. The City's internal service charges are calculated every year and the amount due from each Department may change from year to year. The City's internal service charges include Building Service Charges, Vehicle Services Charges, Insurance Charges, and Information Systems Maintenance Charges. I. Indirect overhead costs consist of central services or support functions shared across Departments. J. The CDC -HA is, and has been, paying the City for rent of the office space at the Community Center and paying the City internal service charges and indirect overhead costs for the administration of the Program through fund transfers. K. The City's external auditors, Pun & McGeady, LLC, performed a single audit pursuant to OMB Circular A-133 and, on March 11, 2014, issued a Single Audit Report for the year ending June 30, 2014 (the "Audit Report"). L. In the Schedule of Findings and Questioned Costs, Section III of the Audit Report, the auditors found that there was a lack of documentation clearly delineating the rent fee from the internal service charges and indirect overhead costs. The rent fee is only for the use of office space occupied by Housing Choice Voucher staff members at the Community Center. M. The purpose of this MOU is to set forth the process by which the CDC -HA transfers funds to the City for rent and other allowable costs pursuant to OMB Circular A-87. Specifically, this MOU will clearly document the separate fund transfers from the CDC -HA to the City for rental costs and internal service charges and indirect overhead costs for the administration of the Program. AGREEMENT 1. Term. The duration of this MOU is for the period of March 11, 2014 through June 30, 2014. 2. The fair market rent for the office space shall be determined based on current local information such as comparable leases of comparable space. 3. The CDC -HA agrees to allow the transfer of $3,366 to the City each month by fund transfer for rent costs. Memorandum of Understanding 2 City of National City and March 11, 2014 — June 30, 2014 CDC -Housing Authority of National City 4. The CDC -HA agrees to allow the separate transfers of its allocation of the internal service charges and indirect overhead costs upon notification by the Director of Finance, or his or her designee, of the amounts of those charges and costs. 5. Any amendment or modification to the terms of this MOU must be in writing and signed by both Parties. 6. This MOU may be terminated by either Party upon thirty -days' written notice to the other Party. 7. This MOU supersedes any prior agreements, negotiations and communications, oral or written, and contains the entire agreement between the Parties. The Parties have executed this MOU on October 21, 2014. CITY OF NATIONAL CITY COMMUNITY DEVELOPMENT COMMISSION — HOUSING AUTHORITY By: Leslie Deese, City Manager APPROVED AS TO FORM: Claudia Gacitua Silva City Attorney By: Ron Morrison, Chairman APPROVED AS TO FORM: Claudia Gacitua Silva General Counsel Memorandum of Understanding 3 City of National City and March 11, 2014 — June 30, 2014 CDC -Housing Authority of National City RESOLUTION NO. 2014 — 27 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY AUTHORIZING THE CHAIRMAN TO EXECUTE A MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF NATIONAL CITY AND THE COMMUNITY DEVELOPMENT COMMISSION — HOUSING AUTHORIY OF THE CITY OF NATIONAL CITY FOR THE RENTAL OF OFFICE SPACE WHEREAS, the Community Development Commission -Housing Authority of the City of National City ("CDC -HA) is, and has been, paying the City of National City rent for the office space at the Martin Luther King, Jr. Community Center (the "Community Center"), and paying the City internal service charges and indirect overhead costs for the administration of the Housing Choice Voucher Program (the "Program") through fund transfers; and WHEREAS, the City's external auditors, Pun & McGeady, LLC, performed a single audit on March 11, 2014, and issued a Single Audit Report for the year ending June 30, 2014 (the "Audit Report"); and WHEREAS, in the Schedule of Findings and Questioned Costs, Section III of the Audit Report, the auditors found that there was a lack of documentation clearly delineating the rent fee, which is only for the use of office space occupied by Housing Choice Voucher staff members at the Community Center, from the internal service charges and indirect overhead costs; and WHEREAS, the proposed Memorandum of Understanding sets forth the process by which the CDC -HA transfers funds to the City for rent and other allowable costs, and documents the separate fund transfers from the CDC -HA to the City for rental costs and internal service charges and indirect overhead costs for the administration of the Program. NOW, THEREFORE, BE IT RESOLVED by the Community Development Commission -Housing Authority of the City of National City that the Chairman is hereby authorizes to execute a Memorandum of Understanding to set forth the process by which the Community Development Commission -Housing Authority of the City of National City transfers funds to the City of National City for rent and other allowable costs. The Memorandum of Understanding is on file in the Office of the City Clerk. PASSED and ADOPTED this 21st day of October, 2014. Ron Morrison, Chairman ATTEST: APPROVED AS TO FORM: Leslie Deese, Secretary Claudia Gacitua Silva General Counsel