HomeMy WebLinkAboutResolutions - 2018.08.22 - 23753MISCELLANEOUS RESOLUTION #18303 August 22, 2018
BY: Commissioner Phillip Weipert, Chairperson, Planning and Building Committee
IN RE: FACILITIES MANAGEMENT — LEASE RATE INCREASE FOR 52-4 TROY DISTRICT COURT
To the Oakland County Board of Commissioners
Chairperson, Ladies and Gentlemen:
WHEREAS the County of Oakland ("the County") currently leases a building at 500 West Big Beaver
Road, Troy, Michigan, to operate the 52-4 District Courthouse (Troy); and
WHEREAS the lessor is the City of Troy; and
WHEREAS the original lease requires the County to pay an annual fixed fee for capital maintenance
($32,400) and adjustable fees for building maintenance ($29,685), custodial services ($46,131), site work
maintenance ($44,388), and insurance ($5,000) for a total of $157,604 per year; and
WHEREAS per the original lease, the adjustable fees may be increased up to six percent per year; and
WHEREAS the City of Troy has not increased any fees since the lease was originally signed in 1996; and
WHEREAS the City of Troy re-bid custodial services citywide this year and competitively selected D. M.
Burr; and
WHEREAS the increase in costs for custodial services from D. M. Burr will be effective July 1,2018; and
WHEREAS the 52-4 District Court's new share of costs for custodial services will now total $91,815 per
year, an increase of $45,684; and
WHEREAS a $45,684 per year increase violates the six percent per year condition of the original lease,
however, if the City of Troy had increased the County's annual fees by the rate of inflation (assuming 3%
CPI) since 1996, the 52-4 District Court would be paying $293,190 per year instead of the $167,604 per
year that the Court is currently paying; and
WHEREAS the 52-4 District Court, Facilities Management and Corporation Counsel recommend
executing amendment #2 to the lease between the County and the City of Troy increasing the annual fee
paid for custodial services by $45,684 per year, effective July 1, 2018.
NOW THEREFORE BE IT RESOLVED that the Oakland County Board of Commissioners hereby
approves an adjustment to the lease for the 52-4 District Courthouse (Troy) located at 500 West Big
Beaver Road, Troy, Michigan, to an annual amount of $203,288.
BE IT FURTHER RESOLVED that the Oakland County Board of Commissioners directs its Chairperson
or designee to execute amendment #2 to the lease between the County and the City of Troy and any
other related documents between the County and the City of Troy.
Chairperson, on behalf of the Planning and Building Copm4tee, I move the adoption of the foregoing
resolution.
Commissioner Philip Weipert, District #8
Chairperson, Planning and Building Committee
PLANNING AND BUILDING COMMITTEE
Motion carried unanimously on a roll call vote.
,••n•nn
I HEREBY APPROVE THE FOREGOING RESOLUTION
,ard,
to-sri 467)
ADR REVIEW SIGN OFF — Facilities Management
RESOLUTION TITLE: Lease Rate Increase for 52-4 Troy District Court
DEPARTMENT CONTACT PERSON: Paul Zachos 858-5380
DATE: 7/25/2018
DEPARTMENT REVIEW
Department of Human Resources:
Approved (No Committee) - Heather Mason (7/24/2018)
Corporation Counsel:
Approved —Jody Hall (7/24/2018)
Department of Management and Budget:
Approved — Lynn Sonkiss (7/25/2018)
AMENDMENT #2 TO LEASE
BETWEEN
THE COUNTY OF OAKLAND AND
THE CITY OF TROY
This Second Amendment (2nd Amendment) is entered into this day of
20 , between the County of Oakland, located at 1200 North Telegraph Road, Pontiac, MI 48341
("Tenant") and the City of Troy located at 500 West Big Beaver, Troy, MI 48084 ("Landlord").
BACKGROUND
A. The Parties entered into a lease that commenced on June 10, 1999 ("Lease") and entered into the
first Lease Amendment on September 28, 2017 (1st Amendment"). The l st Amendment
extended the term of the Lease until June 10, 2034.
B. The Parties desire to amend the Lease to change the square footage rate paid by the Tenant to
address an increase in costs for custodial services at the 52-4 District Courthouse.
C. In consideration of the mutual covenants contained herein, the Parties agree to amend the Lease as
follows:
2' AMENDMENT
A. Section 3.1 is amended and replaced with the following:
3.1 During the term of this Lease, Tenant shall pay Landlord monthly fees as set forth herein. This
shall include fixed fees for capital maintenance and insurance and adjustable fees for building
maintenance, custodial services and site work maintenance. The adjustable fees will reflect the
Landlord's actual costs, which will be calculated using the percentage of the area of leased space
(32,400 square feet) in proportion to the total square footage of Landlord's buildings on its civic center
(153,000 square feet), applied against the Landlord's total eligible expenditures.
3.1.1 Capital Maintenance Fee: $32,400,00 annually; paid in 12 equal installments of $2,700.00
each, payable on or before the 1 st day of each month, starting July 1, 2018, and continuing for the
duration of the Lease. The parties may periodically review this capital maintenance fee and may
mutually agree in writing to adjust this amount to accommodate requests.
3.1.2 Liability/ Property Insurance Fee: $5,000.00 annually, paid in 12 equal installments of
$416.67, payable on or before the 1 St day of each month, starting July 1,2018, and continuing for the
duration of the Lease. The parties may periodically review this fee and may mutually agree in writing
to adjust this amount to reflect significant changes.
3.1.3 Adjustable Building Maintenance & Custodial Services- The building maintenance and
custodial service fee shall be $121,500 annually, paid in monthly installments of $10,125.00, payable
on or before the 1St day of each month, starting July 1, 2018, and continuing for the duration of the
Lease. This amount is calculated based on 32,400 square feet of leased space, which is a cost of $3.75
per square foot. Starting July 1, 2019, this amount may be annually adjusted by Landlord to cover
Page I of 3
2nd Lease Amendment
Final Version (07-23-18)
increases in the actual costs for building maintenance and custodial services, but in no event, will any
annual increase exceed 6% without the written express approval of the Tenant.
3.1.4 Adjustable Site Work Maintenance Services- The site work maintenance fee shall be
44,388 annually, paid in monthly installments of $3,699.00, payable on or before the 1st day of each
month, starting July 1, 2018, and continuing for the duration of the Lease. This amount is calculated
based on 32,400 squnre feet of leased space, which is a cost of $1.37 per square foot. Starting July 1,
2019, this amount may be annually adjusted by Landlord to cover increases in the actual costs for site
work maintenance, but in no event, will any annual increase exceed 6% without the written express
approval of the Tenant.
B. Continued Effect. All other terms and conditions of the Lease shall continue with full force
and effect, except as modified herein.
C. Entire Agreement: This 2 nd Amendment and the temis and conditions of the Lease and 1st
Amendment attached as Exhibit A, constitute the entire agreement and understanding between
Landlord and Tenant and supercedes any and all other prior oral or written understandings,
communications or agreements between Landlord and Tenant.
IN WITNESS WHEREOF, hereby acknowledges that s/he is authorized
by the County of Oakland to execute this 2 nd Amendment.
TENANT: County of Oakland
By:
Date:
Subscribed and sworn to before me on the day of , 20
Notary Public,
Oakland County, Michigan
My Commission Expires:
Acting in the County Oakland
Page 2 of 3
2nd Lease Amendment
Final Version (07-23-18)
TN WITNESS WHEREOF, hereby acknowledges that
he is authorized by the City of Troy to execute this 2 nd Amendment.
LANDLORD: City of Troy
By:
Dane Slater, Mayor
Date:
Subscribed and sworn to before me on the day of
,20 .
Notary Public
Oakland County, Michigan
My Commission Expires:
Acting in the County of Oakland
By:
Aileen M. Dickson, City Clerk
Date:
Subscribed and sworn to before me on the day of
Notary Public
Oakland County, Michigan
My Commission Expires:
Acting in the County of Oakland
Page 3 of 3
2nd Lease Amendment
Final Version (07-23-1g)
Annual Lease Calculation
52-4 Judicial District Courthouse
Effective July 1, 2018
To reflect increased service for Janitorial Services
Original Lease Terms:
Section
A Building Mantenance/Custodial Services and Capital Maintenance
Fixed
Capital Maintenance
Adjustable
Building Maintenance, Custodial Services (32,400 Sq.Ft.@ $2.34 per Scift.)
Total Original Lease Cost - Building Maint./Custodial/Capital
Amendment to Original Lease:
Adjustable
Increased Custodial Service Level Through DM Burr Group
(New Contract $91,815 less Original Budget (adjusted) $46,131)
A Amended Section A (Fixed Capital $32,400 + Adjustable (32,400 Sq.Ft@$3.75))
Original Lease Terms:
Site Work Maintenance
Adjustable
Site Work Maintenance (32,400 Sq.Ftg$1.37)
Original Lease Terms:
Insurance
Adjustable
Liability/Property
Total Adjusted Annual Fee
$ 32,400
75,816
108,216
45,684
153,900
44,388
5,000
$ 203,288
Amount per invoice @ 12 monthly installments $ 16,940.67
FISCAL NOTE (MISC. #183031 August 22, 2018
BY: Commissioner Tom Middleton, Chairperson, Finance Committee
IN RE: FACILITIES MANAGEMENT — LEASE RATE INCREASE FOR 52-4 TROY DISTRICT
COURT
To the Oakland County Board of Commissioners
Chairperson, Ladies and Gentlemen:
Pursuant to Rule XII-C of this Board, the Finance Committee has reviewed the above referenced
resolution and finds:
1. The resolution authorizes Amendment #2 to the lease (approved per M.R. #96263 and
#17269) between the County of Oakland and the City of Troy for the building located at
520 West Big Beaver, Troy, Michigan that provides courthouse facilities for the 52-4
District Court.
2. The City of Troy has re-bid custodial services citywide resulting in the Court's share of
costs to increase by $45,684 per year.
3. The Departments of Facilities Management and Corporation Counsel have reviewed
and/or prepared the documents associated with Amendment #2 of the lease.
4. The adjustable fees for building maintenance and custodial services have increased to
$3.75 per square foot annually.
5. Annual prorated costs for custodial services in FY 2018 total $57,552 based on
commencement date of July 1, 2018; annual costs for custodial services in FY 2019 and
FY 2020 total $91,815.
6. Other fees such as fixed capital maintenance ($32,400 annually) as well as adjustable
fees for site work maintenance ($1.37 per square foot annually) and liability/property
insurance ($5,000 annually) will remain at the amounts denoted in the lease and continue
to be paid by the County of Oakland.
7. The new total annual lease amount is $203,288 effective July 1, 2018.
8. The FY 2018— FY 2020 budget amendments are recommended as detailed below:
General Fund #10100
Revenues:
9010101-196030-665882 Planned Use of Balance
Total Revenues
FY 2018
FY 2019- FY 2020
$ 11,421
$ 11,421
$ 45,684
$ 45,684
Expenditures:
3020501-121020-731626 Rent
Total Expenditures
$ 11,421
$ 11,421
$ 45,684
$ 45,684
missioner Thomas Middleton, District #4
Chairperson, Finance Committee
FINANCE COMMITTEE VOTE:
Motion carried unanimously on a roll call vote with Zack and Long absent.
Resolution # 18303 August 22, 2018
Moved by Long supported by Zack the resolutions (with fiscal notes attached) on the amended Consent
Agenda be adopted (with accompanying reports being accepted).
AYES: Bowman, Crawford, Dwyer, Fleming, Gershenson, Hoffman, Kochenderfer, KowaII, Long,
McGillivray, Middleton, Quarles, Spisz, Taub, Weipert, Woodward, Zack, Berman. (18)
NAYS: None. (0)
A sufficient majority having voted in favor, the resolutions (with fiscal notes attached) on the amended
Consent Agenda were adopted (with accompanying reports being accepted).
STATE OF MICHIGAN)
COUNTY OF OAKLAND)
I, Lisa Brown, Clerk of the County of Oakland, do hereby certify that the foregoing resolution is a true and
accurate copy of a resolution adopted by the Oakland County Board of Commissioners on August 22,
2018, with the original record thereof now remaining in my office.
In Testimony Whereof, I have hereunto set my hand and affixed the seal of the County of Oakland at
Pontiac, Michigan this 22nd day of August, 2018.
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Lisa Brown, Oakland County