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HomeMy WebLinkAbout1 - Original Submission_ BGC Management Agreement 2021 Final1 MANAGEMENT AGREEMENT BREMERTON GOVERNMENT CENTER THIS AGREEMENT relating to the management of Bremerton Government Center, a Condominium (the “Condominium”), is made as of this __1__ day of March___2021___, by and between BREMERTON GOVERNMENT CENTER ASSOCIATION (the “Association”) and CITY OF BREMERTON (the “Managing Agent”) upon the terms hereinafter set forth. Unless otherwise specified, capitalized terms used herein have the same meaning provided in the Condominium Declaration for Bremerton Government Center, a Condominium (the “Condominium Declaration”), recorded under Kitsap County Auditor’s No. 200409300447. A. DUTIES OF THE ASSOCIATION: The Association agrees: 1. To retain the Managing Agent to perform the management services set forth herein for the term of this Agreement. 2. To furnish the Managing Agent with: a. a complete list of Owners, lessees, and other users, to include addresses, primary contacts, telephone numbers, and other information reasonably necessary for communication and billing purposes, supplemented and updated as Units are sold or leased; b. a set of the building plans and specifications used for construction of the Condominium; c. a current copy of the Declaration, Articles, Bylaws, and rules and regulations and any amendments thereto; and d. a complete set of all financial, maintenance, service contracts, and all other records pertaining to the Managing Agent’s management of the Condominium. 3. To pay to the Managing Agent the Management Fee as approved by the Board in connection with adoption of the annual budget of the Association and agreed to by the Managing Agent on the first day of each month in advance, as a fee for management and other services rendered hereunder, except as hereinafter otherwise specifically provided. The Management Fee covers normal and usual administrative expenses of the Managing Agent as specified under B below ("Basic Services of the Managing Agent"). The Association shall pay unusual expenses of the Managing Agent including Capital Improvements or other services required the Board, as specified under C below ("Additional Services of the Managing Agent"). 4. To provide the Managing Agent with evidence of authority by way of certified resolutions or otherwise and such specific directions as the Managing Agent may reasonably DocuSign Envelope ID: 1DE6051C-71D1-49FF-9391-52887F4AF938 2 require to take actions in the management of the Bremerton Government Center. 5. To hold the Managing Agent harmless and free from all liability in the event of bankruptcy, receivership, insolvency, or failure of a depository for the Association's funds, provided the depository is insured by a Federal agency to the full extent of the deposited funds or otherwise specifically designated by the Board. 6. To defend, indemnify, and hold the Managing Agent harmless from all liability whatsoever arising in connection with its management of the Condominium, except in cases of the Managing Agent’s negligence or willful misconduct, and to carry, at its own expense, necessary public liability insurance adequate to protect the Managing Agent to the same extent it protects the Association, and on request provide the Managing Agent with evidence that such insurance is in force and effect and that the Managing Agent is named as an additional insured. 7. To cooperate reasonably with the Managing Agent to the extent required for the Managing Agent to perform expeditiously, efficiently, and economically the management services required under this Agreement. 8. To designate one member as the Board's representative to deal with the Managing Agent on any matter relating to management of the Association. In the absence of any other designation, the President of the Board will be deemed to have this authority. B. BASIC SERVICES OF THE MANAGING AGENT: The Managing Agent shall provide the following Basic Services for the Association: 1. Provide advice to the Association relating to staffing requirements, hire and discharge personnel, negotiate service contracts, and purchase repair and maintenance materials and equipment to be used in the ordinary course of the operation and maintenance of the Condominium. All personnel performing services on behalf of the Managing Agent for the Association primarily at the Condominium will be employed by the Managing Agent. These personnel initially consist of the Building Superintendent, and half-time Maintenance worker currently employed by Housing Kitsap. These individuals will be offered 12-month temporary employment by the Managing Agent in their current roles, and upon the end of the 12 months the positions will be advertised for open recruitment. It is understood that employees of the Kitsap Public Health District will be providing janitorial services with respect to the common areas on the third and fourth floors of the building. 2. Prepare an annual operating budget after consulting with the President of the Board and present it to the Board within thirty (30) days prior to the end of the fiscal accounting year, itemizing anticipated expenses and disbursements for the new fiscal year in accordance with the Declaration. 3. Prepare and distribute monthly and year-to-date statements of revenues and expenditures prepared on an accrual basis showing: assessments and other cash receipts collected; amount and purpose of each disbursement as compared with budgeted expenses by budget; net cash gain or loss, cash-on-hand, and reserve accounts; names of any Owners delinquent in payment DocuSign Envelope ID: 1DE6051C-71D1-49FF-9391-52887F4AF938 3 of their assessments and the amount of each delinquency. 4. Collect assessments and direct charges due from Owners or other payments owing to the Association. The Managing Agent may take such action in the name of the Association by way of legal process or otherwise as required for the collection of delinquent monthly assessments and direct charges. The Association shall reimburse the Managing Agent for all reasonable legal costs incurred for collection. 5. Write checks on behalf of the Association to pay utility fees; service contracts, material, supply and equipment purchases; subscriptions; insurance payments and all other required expenditures included in the Annual Budget as approved by the Board. Expenditure Authority for the Managing Agent shall generally comply with City of Bremerton Municipal Code Section 2.76 “Procurement and Disposal Code”, except that all requirements for Mayor or City Council approval or authorization shall require approval of the Board. It is specifically noted that this provision allows the Managing Agent to make purchases and execute contracts for activities included in the approved Annual Budget with a value up to $25,000 without additional approval of the Board. 6. Assist in and permit the inspection, auditing and copying of books and records relating to this Agreement by authorized agents of the Association during normal business hours with reasonable prior notice. 7. Timely prepare reports and forms the Association is required to submit by law with the exception of income tax returns. 8. Arrange for investment of Association funds, separate and apart from the Managing Agent's own funds, in trust accounts, securities, or other investments as directed by or mutually agreed upon by the Association and the Managing Agent; receipts and disbursements to be promptly reported to the Association. 9. Secure and maintain appropriate insurance coverages for fire and extended coverage, general liability, fidelity bonds, statutory, and other approved forms of insurance coverages as required by the Declaration or authorized by the Board. 10. Process insurance claims made under the Association's insurance policies. 11. Maintain comprehensive financial records of the Association's receipts and disbursements. 12. Maintain a list of current Owners and lessees. 13. Attend all meetings of the members of the Association and the Board, and ensure the Board is informed on all current building issues and projects. 14. Addendum No. 1 to this Agreement entitled "HIPAA Business Associate Addendum" has been executed between the Managing Agent and the Kitsap Public Health District to ensure the privacy and security of protected health information in the Health District's office Units, as required by the Health Insurance Portability and Accountability Act of 1996, as amended. DocuSign Envelope ID: 1DE6051C-71D1-49FF-9391-52887F4AF938 4 C. ADDITIONAL SERVICES OF THE MANAGING AGENT: The following Additional Services, which are not of a routine nature, shall be provided only if authorized by the Board either by approval in the Annual Budget, or through separate Board action, and are not within the Management Fee for Basic Services provided in Section B above. 1. The Managing Agent shall manage and inspect improvement, rehabilitation, and construction projects as included in the Annual Budget or separately approved by the Board as Capital Expenditures with similar staffing and the same standard-of-care it uses in delivering similar projects for the City of Bremerton. All authorized, documented and reasonable costs incurred by the Managing Agent shall be reimbursed. 2. Insurance claims administration. Processing insurance claims in excess of $5,000 between members and insurer or for the Association are charged at the cost of $75.00 per hour. 3. Assistance with legal proceedings. If the Managing Agent is called upon to assist the Association in any legal or quasi-legal proceedings, including but not limited to litigation, mediation or arbitration, the Managing Agent shall be entitled to be reimbursed for the amount of the authorized, reasonable and documented costs it incurs in so assisting the Association. These costs will include reimbursement for personnel time expended and for out-of-pocket expenses incurred in answering questions, participating in meetings or proceedings, and retrieving or compiling information or records. The Managing Agent, however, shall not be entitled to such reimbursement to the extent that a proceeding arises from the willful misconduct or the negligence of the Managing Agent or its officials, officers, employees or agents. D. COSTS CHARGED AGAINST ASSOCIATION FUNDS 1. All acts performed by the Managing Agent in accordance with the above provisions shall be for the benefit of the Association and its members, and all obligations and expenses reasonably incurred by the Managing Agent that exceed the value of the Management Fee (including but not limited to the cost of hiring contractors, accountants, attorneys, and other personnel; negotiating, managing and executing service contracts; updating Reserve Studies; developing and managing Capital Improvement Plans; and the cost of copying, postage, long distance telephone, deliveries, etc.) shall be reimbursed by the Association at the Managing Agent’s authorized, documented and reasonable cost. 2. The Managing Agent shall not be required to perform any act or duty hereunder involving the expenditure of money unless the Managing Agent shall have in its possession sufficient Association funds available therefor. If at any time such funds are not sufficient to pay charges incident to this Agreement, the Managing Agent may advance such sums as it reasonably deems necessary, and the Association shall, upon notice, pay to the Managing Agent the sums necessary to cover such deficit or such advances together with interest at twelve percent (12%) DocuSign Envelope ID: 1DE6051C-71D1-49FF-9391-52887F4AF938 5 per annum from and after ten (10) days from date of payment. E. STANDARD OF CARE OF MANAGING AGENT: The Managing Agent is a municipality with experience managing a variety of properties. The Managing Agent shall use its best efforts to perform the services required of it under this Agreement in a professional manner and in accordance with usual and customary, professional and industry standard practices. F. INDEMNIFICATION: Each party to this Agreement agrees to defend and indemnify the other party and its elected and appointed officials, officers, employees and agents against all claims, losses, damages, suits and expenses, including reasonable attorneys' fees and costs, to the extent they arise out of, or result from, the negligence or willful misconduct of the indemnitor or its elected or appointed officials, officers, employees and agents in the performance of this Agreement. The indemnitor' s duty to defend and indemnify extends to claims by the elected or appointed officials, officers, employees and agents of the indemnitor or of any contractor or subcontractor of indemnitor. The indemnitor waives its immunity under Title 51 (Industrial Insurance) of the Revised Code of Washington solely for the purposes of this provision. The provision shall survive expiration or termination of this Agreement. G. INSURANCE: Each party shall maintain insurance coverages in amounts and type, including commercial general liability, that are required under the Declaration or are appropriate in light of its obligations under this Agreement. Without limiting the foregoing, the Managing Agent shall maintain fidelity insurance in accordance with Section 19.6 of the Declaration. Any insurance coverages obtained pursuant to this Agreement shall be consistent with the requirements and specifications set forth in Article 19 (Insurance) of the Condominium Declaration. H. TERM AND TERMINATION: The term of this Agreement shall begin on the date written first above and continue for an initial term of one year; and shall continue thereafter for annual terms unless terminated at the end of any term as provided herein. This Agreement may be terminated without cause at the end of the initial term or the end of any subsequent term by either party upon the giving of written notice sixty (60) days prior to the termination date. If the Managing Agent fails to perform any material obligation under this Agreement and such failure is not cured within 30 days after written notice by the Association or such longer period of time as may be reasonable under the circumstances, the Association may immediately terminate this Agreement by written notice to the Managing Agent and shall have all rights and remedies available to it under general law. In such event, the Managing Agent shall extend its full cooperation during any transition period to a new managing agent, which DocuSign Envelope ID: 1DE6051C-71D1-49FF-9391-52887F4AF938 6 obligation shall survive termination of this Agreement. I. MISCELLANEOUS: 1. The Managing Agent assumes no liability whatsoever for any acts or omissions of the Board, or any previous boards, Owners, or agents of the Association. DocuSign Envelope ID: 1DE6051C-71D1-49FF-9391-52887F4AF938 7 agent. 2. The relationship of the parties to this Agreement shall be that of principal and 3. Except with respect to payment of fees due and owing the Managing Agent, performance by either the Association or the Managing Agent is excused if and so long as prevented by governmental restrictions, war, insurrection or civil commotion, labor disputes, or other causes beyond the control of the nonperforming party. 4. The Managing Agent agrees not to collect for its own account or benefit any undisclosed fees, rebates, or discounts. 5. Except as otherwise provided for herein with respect to the Condominium Declaration, this Agreement shall constitute the entire agreement between the contracting parties, and no variance or modification thereof shall be valid and enforceable, except by an executed and approved agreement in writing. 6. Waiver by either party hereto of a default or breach of any provision hereunder shall not be construed to be a waiver of any succeeding default or breach of such provision or waiver of the provision itself. 7. Notice by one party to the other shall be in writing and must be delivered personally or sent by registered or certified mail. 8. This Agreement shall inure to the benefit of and constitute a binding obligation upon the Association and the Managing Agent, and their respective heirs, administrators, successors, and assigns. 9. The parties understand and agree that the Managing Agent, during the entire term of this Agreement, may pursue and engage in such business and nonbusiness activities for its own account and not on behalf of the Association, as the Managing Agent may deem necessary or desirable, regardless of whether or not such activity relates to the Condominium, and may receive for its own accounts the income, profits, and compensation resulting from such activity, provided that during the term of this Agreement the Managing Agent shall not pursue or engage in any activity that would conflict with or prevent performance of the Managing Agent's duties provided for hereunder. Notwithstanding the foregoing, the Association acknowledges that the Managing Agent: (a) may own one or more Units in the Condominium, and (b) may have a person employed by or affiliated with the Managing Agent as a member of the Board. If Managing Agent becomes aware of any actual or potential conflict of interest arising between the Managing Agent's duties under this Agreement and its other capacities or activities relating to the Condominium, the Managing Agent shall promptly bring such conflict to the attention of the Board for discussion and resolution. 10. The Managing Agent and its officials, officers, employees and agents shall comply with all applicable federal, state, and local laws, rules and regulations in the performance of their duties under this Agreement. DocuSign Envelope ID: 1DE6051C-71D1-49FF-9391-52887F4AF938 8 11. Except as expressly provided otherwise in this Agreement, the Managing Agent in the performance of its duties under this Agreement shall use only its bona fide employees and shall not delegate or subcontract any of its duties to any other party without the approval of the Board, which approval may not be unreasonably withheld. 12. In performing its duties under this Agreement, the Managing Agent and its officials, officers, employees and agents shall not discriminate against any person on the basis of race, color, creed, religion, national origin, age, sex, marital status, veteran status, disability or any other basis prohibited by law. 13. This Agreement shall be governed by the laws of the State of Washington, and any legal proceeding arising under, or relating to, it shall be maintained only in a court of competent jurisdiction in Kitsap County, Washington. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written. ASSOCIATION: BREMERTON GOVERNMENT CENTER ASSOCIATION By____________________________ Its Board President ATTEST: Board Secretary MANAGING AGENT: CITY OF BREMERTON By __________________________________ Its Mayor ATTEST: City Clerk DocuSign Envelope ID: 1DE6051C-71D1-49FF-9391-52887F4AF938 Approved as to form: __________________________________ Roger Lubovich, City Attorney 9 DocuSign Envelope ID: 1DE6051C-71D1-49FF-9391-52887F4AF938