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COUNTY OF SAN MATEO
Inter-Departmental Correspondence
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County Manager’s Office
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DATE:
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October 20, 2008
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BOARD MEETING DATE:
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November 4, 2008
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SPECIAL NOTICE/HEARING:
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None
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VOTE REQUIRED:
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Majority
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TO:
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Honorable Board of Supervisors
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FROM:
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John L. Maltbie, County Manager
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SUBJECT:
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Peninsula Conflict Resolution Center Agreement
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RECOMMENDATION:
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Resolution authorizing:
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1)
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Execution of an agreement with Peninsula Conflict Resolution Center (PCRC) to forgive the unsecured loan in exchange for PCRC’s agreement to provide an array of services to the County, at no cost to the County through 2021, and
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2)
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Termination of the Unsecured Loan Agreement and cancellation of the Promissory Note
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VISION ALIGNMENT:
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Commitment: Realize the Potential of our Diverse Population
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Goal 1: Our diverse population works well together to build strong communities, effective government and a prosperous economy. This action promotes strong communities and effective government by facilitating constructive civic engagement and developing conflict resolution skills among County staff.
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BACKGROUND:
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On May 1, 2001, the Board of Supervisors adopted Resolution No. 054412, where the County and PCRC entered into an agreement which provided for the County to assist in the financing of PCRC's purchase of the real property commonly known as 1300 El Camino Real, Belmont. Under the terms of the Financing Agreement, the County loaned $477,125 to PCRC under the County's Non-Profit Agency Office Purchase Loan Program for the acquisition and renovation of the Property. The loan was secured by a second deed of trust on the Property. Comerica Bank, senior lender in the acquisition of the Property, foreclosed, and the County's lien was extinguished by the foreclosure.
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On June 8, 2004, by the Board of Supervisors adoption of Resolution No. 066684, the County and PCRC agreed to terminate the Financing Agreement and to restructure PCRC’s obligation to County as an unsecured loan, and therefore the parties entered into an Unsecured Loan Agreement, and PCRC executed an adjustable rate promissory note in favor of the County, which provided for payments of Nine Hundred dollars ($900) per month from 2006 through June 2009, with payments to increase to Two Thousand Forty-Six dollars ($2,046) per month from July 2009 until the loan is paid off in 2021.
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DISCUSSION:
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PCRC has advised the County that they are unable to make the payments on the unsecured loan and still remain financially sound. However, rather than simply walking away, PCRC has requested that the County terminate the unsecured loan agreement and enter into a new agreement, whereby PCRC will provide an array of special services to the County, at no cost to the County through 2021.
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The agreement provides that PCRC shall offer to the County, and to persons and entities designated by the County, an array of ten special services, such as mediation, facilitation, workplace effectiveness training, leadership training, and facilitation of retreats, meetings, and forums. During the term of this Agreement, until 2021, the County Manager may select four of those services to be provided by PCRC at no cost to the County or the recipients of the services. The County’s forgiveness of the loan shall be full consideration for the services.
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The agreement and the resolution have been approved as to form and content by County Counsel.
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FISCAL IMPACT:
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The County will receive $12,500 a year in services from PCRC at no cost. Over the course of the 13-year agreement, the total present value of the PCRC services is $162,500. PCRC annually provides over $1.6 million in services to San Mateo County residents that are not provided by any other group in the County. Their contributions to the community combined with the free services for 13 years to the County are significantly greater than the balance of the loan.
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