HomeMy WebLinkAboutR-2009-100 Capitol Theatre Operating Agreement with the Capitol Theatre CommitteeRESOLUTION NO. R-2009-100
A RESOLUTION authorizing and directing the City Manager to execute an Operating
Agreement with the Capitol Theatre Committee to provide for regular
operations at the Theatre and setting the terms and conditions under which
the Theatre will be managed.
WHEREAS, the City of Yakima has had a long relationship with the Capitol Theatre
Committee, a non-profit corporation, for management of the Theatre; and
WHEREAS, the existing agreement between the City of Yakima and the Committee is
expiring; and
WHEREAS, it is in the best interests of the City to retain the services of the Capitol
Theatre Committee for the continued operation of the theatre; and
WHEREAS, it is necessary to make certain modifications to the existing contract,
beneficial to both parties; and
WHEREAS, the parties have agreed to those certain modifications; and
WHEREAS, the revised contract will provide for efficient management of the Theatre
in the best interests of both the City of Yakima and the Capitol Theatre Committee; Now,
Therefore,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA:
The City Manager is hereby authorized and directed to execute the attached and
incorporated Operating Agreement with the Capitol Theatre Committee to provide for the
operation of the Capital Theatre.
ADOPTED BY THE CITY COUNCIL this 7th day of July 009,
ATIEST:
1
vid Ed e , ayor
K- 2009-100
CAPITOL THEATRE OPERATING AGREEMENT
THIS AGREEMENT, made and entered into this ;5"i day of I La, u_5 r
2009, by and between CITY OF YAKIMA, a municipal corporation, hereinafter called "City,"
and CAPITOL THEATRE COMMITTEE, INC., a Washington non-profit corporation,
hereinafter referred to as "CTC."
WITNESSETH:
WHEREAS, the City of Yakima is the owner of a performing arts facility (hereinafter
referred to as the "THEATRE" which is situated upon the following described real property in
Yakima County, State of Washington, to wit:
Lots 29, 30, 31 and 32, Block 71, Town of North Yakima, now
Yakima, Washington, according to the official plat thereof
recorded in Volume "A" of Plats, page 10, and re-recorded in
Volume "E" of Plats, page 1, records of Yakima County,
Washington.
WHEREAS, CTC has been organized for the express purpose of occupying, managing
and operating the THEATRE as provided by this agreement, and
WHEREAS, both parties desire that the THEATRE be managed and operated as a place
for public entertainment and cultural events in accordance with the provisions, terms and
conditions of this agreement, to the end that the THEATRE will serve as an economic and
cultural stimulant for the community and the people of the City of Yakima and its environs;
In consideration of the mutual undertaking and promises contained herein, and the
benefits to be realized by each party and in future consideration of the benefit to the general
public by the enhancement of the economic and culture climate of the City and its environs to be
realized by the performance of this agreement, and as a direct benefit to the City, the parties
agree as follows:
A. RESPONSIBILITIES OF CTC.
1. CTC shall occupy, manage and operate the THEATRE according to the
provisions, terms and conditions of this agreement. CTC shall generally promote the THEATRE
through brochures or other means of advertising designated to attract performances and state
exhibitions and events to the THEATRE, and shall schedule and book such performances,
exhibits and events to occur at the THEATRE. CTC shall diligently pursue continuous use of
the THEATRE and shall promote current shows and events of public interest.
CTC shall be responsible for all costs of administration and daily operational expenses as
the same shall directly relate to such facility's use as a performing arts facility, auditorium and
meeting hall. CTC shall be the sole operator of the facility and, in addition to other necessary
functions, shall 1) approve all requests for the use of said facility and 2) be responsible for the
control and security of the THEATRE and all property pertaining thereto.
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2. CTC shall be responsible for general maintenance of the THEATRE
building and premises, including but not limited to, janitorial and cleaning services; removal of
snow, ice and debris from pedestrian walkways; routine minor repair and replacement of
THEATRE premises, property and fixtures (including, but not limited to, plumbing, electrical,
lighting fixtures and damage resulting from vandalism or accident); provided, the liability of
CTC to the City pursuant to this section shall not exceed Two Thousand Dollars ($2,000.00) for
each incident or item of damage or repair, or a total annual aggregate of Twenty Five Thousand
Dollars ($25,000.00) of loss or damage not covered by insurance or otherwise reimbursable to
CTC, unless the damage or necessity for repair was caused by or as a result of CTC's negligent
use of the premises or CTC's failure to perform routine repairs and maintenance as contemplated
by this agreement, in such cases the CTC shall be fully and solely responsible for the full cost of
repair.
3. All funds expended by CTC shall directly or indirectly relate to the
enhancement of the economic and cultural climate of the City and its environs. This includes,
but is not limited to the promotion, operation and/or use of such facility for assembly purposes.
4. CTC shall obtain and maintain commercial general liability insurance and
umbrella liability insurance with a minimum amount of Five Million Dollars ($5,000,000.00)
combined single limit bodily injury and property damage and name the City, its agents,
employees and elected and appointed officials as additional insureds. CTC shall file with the
City a copy of such policies or a certificate of insurance with the provision that they may not be
canceled without ten (10) days prior notice to the City.
5. CTC shall defend, indemnify, and hold harmless the City, its officers,
elected officials, employees and agents from and against any and all claims, causes of action,
damages, losses, and expenses of any kind or nature whatsoever, including but not limited to,
attomey's fees and court costs, arising out of, relating to, or resulting from CTC's performance or
non-performance of the services, duties and obligations required of it under this Agreement.
6. CTC shall manage and operate the THEATRE in accordance with all
applicable laws related thereto.
7. CTC, for information purposes, shall furnish to City, copies of policies,
rules and regulations, rental procedures, charges, hours of operation, uses to which the
THEATRE may be put, together with sample license agreements and contracts entered into with
the performances, concessionaires and so forth.
8. The rules and regulations adopted by CTC shall specifically prohibit the
giving of free tickets or other free entry to any performance of event to any City employee or
officer or to CTC employees or officers, except in the performance of their duties.
9. CTC agrees that it shall maintain fiscal records and accounts in
accordance with systems and procedures prescribed by law„ regulation, City policies and
generally accepted accounting principles as applicable to financial affairs of the City for fiscal
year end financial reporting purposes; and CTC will annually render to the City a written
financial operating statement within sixty (60) days after the end of CTC's fiscal year. It is
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understood that the interim internally prepared financial books and records of CTC may not
comply with general accepted accounting principles applicable to the financial affairs of the City.
10. CTC agrees that all of its books and records pertaining to THEATRE
management and operations shall be open and available for examination at all times by the
Yakima City Manager, Director of Finance and Budget, and other City or third party personnel
designated by either of them. The City Manager and others designated by him shall have the
right to enter upon and inspect the premises at any reasonable time.
11. Except as specifically required for THEATRE operation in accord with
individual performance contracts, CTC shall not subcontract or assign to any person, firm or
corporation, any rights or obligations of CTC under this agreement.
12. CTC agrees and promises to manage and operate the THEATRE and
afford its services to the public on a fair, equal and not unjustly discriminatory basis to all users
thereof, and further agrees that during the performance of this Agreement CTC shall not
discriminate in violation of any applicable federal, state and/or local law or regulation on the
basis of age, sex, race, creed, religion, color, national origin, marital status, disability, honorably
discharged veteran or military status, pregnancy, sexual orientation, and any other classification
protected under federal, state, or local law.
13. The CTC covenants that it will not take or permit to be taken on its behalf any
action that would adversely affect the tax-exempt status of bonds issued by the City on its behalf,
and will take or require to be taken such acts as may reasonably be within its ability, as may from
time to time be required under applicable law, to continue the tax-exempt status of the City's
bonds. City shall be responsible for providing and updating CTC with the requirements
necessary to maintain the tax-exempt status of the said bonds. The CTC shall notify the City of
any change in operating procedures having effect on any Private Activity Use of the Theatre and
be granted permission at the sole discretion of the City prior to any such change. Private
Activity Use is defined by Sec. 141 if the Internal Revenue Code of 1986, as amended. If CTC
is unsure of the affect of any change they shall contact the City for guidance.
B. RESPONSIBILITIES OF CITY.
1. The City shall perform, or cause to be performed by contract, the major
upkeep, maintenance, and repair of THEATRE premises and fixtures as indicated on the
schedule attached hereto marked Exhibit "A", to this agreement, which items of expense shall be
borne directly by the City and which will not be included within the CTC obligation of
maintenance, management and operation responsibility. In order to assure that necessary repairs,
maintenance and upkeep are provided when required, CTC shall advise the City of necessary
repairs, upkeep and maintenance on systems identified in Exhibit "A", in writing, as soon as any
such deficiencies are identified.
2. The City shall maintain property insurance on the building and its contents
in such amount as the City deems appropriate. The City shall not be responsible for insuring any
property owned by the CTC. Any funds derived from such insurance shall be used to repair or
replace the damaged items or property; except should said property as a whole be damaged to an
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extent of over fifty percent (50%) of its value, either party may cancel this agreement by notice
in writing within sixty (60) days of the date of damage. CTC and the City hereby release and
discharge each other from and against all liability arising either from fire loss or damage caused
by any of the perils covered by insurance policies which are in force and effect at the time of
such loss or damage, even though such loss or damage may be due to negligence, act or neglect
of either CTC or the City or agents or employees of either party. It is expressly understood and
agreed that it is the intention of the parties that this provision constitutes a waiver and release of
any and all subrogation rights which the insurance companies might have under such insurance
policies.
3. The City shall make available to CTC the use of City financial and
purchasing systems and forms for bookkeeping purposes, rights for the purchase of equipment,
materials and supplies, and other record keeping and business purposes connected with
THEATRE maintenance, management and operation. To facilitate the management and
operation of the THEATRE, CTC may utilize City services, procedures and forms to the extent
that the parties may agree from time to time.
C. TAXES.
CTC agrees to collect and pay to the City the admission tax on the tickets to THEATRE
events as required by applicable City laws, as they now exist or as they may be amended from
time to time. Taxes that are applicable to CTC's operation, customary use and management of
the THEATRE shall be the responsibility of CTC.
D. TERMS OF AGREEMENT
1. This agreement shall be in full force and effect for a period of three (3)
years from the date set forth at the top of this agreement and shall automatically renew for
additional three (3) year terms thereafter unless otherwise requested, in writing, by either party
hereto. In the event that either party desires to terminate or amend this agreement said party
shall do so by written notice of such intent provided to the other party no less than three (3)
months prior to the termination of the three (3) year period then in affect. In the event the
agreement is automatically renewed for subsequent three (3) year term(s), it shall be renewed
under the same terms and conditions as are set forth in this agreement, or as such terms and
conditions may hereafter be amended by written agreement of both parties hereto.
2. Subject to the City's annual budget review and approval process the City
will pay CTC for the services to be performed by CTC consisting of the occupation,
management, general maintenance (pursuant to paragraph A.2. of the agreement), and operation
of the THEATRE. Annual payments shall be made in four (4) installments, one installment to be
paid on or about the tenth (10`h) day of the month of February, May, August and November,
during the terms of this agreement.
The annual service fee is considered a base -line and may be adjusted, on an annual basis,
depending on the needs of CTC and resources available to the City for such purposes. In the
event that the City and CTC do not agree on an annual service fee to be paid to CTC for its
performance hereunder, the service fee then in effect will continue until such time as the Parties
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agree on a new fee or the or either party exercises its option to terminate this agreement as
provided in Section 3 below.
3. In the event the parties are unable to reach agreement on the service fee to
be paid, then either party shall be entitled to terminate this agreement by giving the other party
thirty (30) days written notice, by registered or certified mail return receipt requested, at the
address provided under Paragraph D.5, This agreement shall not be considered as terminated if
during the 30 day notice period the parties are able to reach agreement relating to the amount of
the service fee to be paid hereunder. In the event either party hereto shall fail to perform the
terms and conditions of this agreement ("default") the non defaulting party shall be entitled to
terminate this agreement by giving the other party thirty (30) days written notice, by registered or
certified mail return receipt requested, at the address provided under Paragraph D.5, below,
stating its desire to terminate the agreement, which notice shall contain a complete and itemized
list of all matters in which the defaulting party is in default. During said thirty (30) day period,
the party receiving notice shall be entitled to reinstate itself by correcting such default..
4. CTC shall be considered as an independent contractor in the operation of
the THEATRE, and this agreement shall not be construed as creating any form of partnership
between City and CTC. As an independent contractor CTC and its employees shall make no
claim of City employment or claim against the City any related employment benefits, social
security, and/or retirement benefits. Nothing contained herein shall be interpreted as creating a
relationship of servant, employee, partnership or agency between CTC or any officer, employee
or agent of CTC and the City.
5. In the event that any dispute shall arise as to the interpretation of this
agreement, or in the event of a notice of default as to whether such default does constitute a
breach of the contract, and if the parties hereto cannot mutually settle such differences, then the
parties shall first pursue mediation as a means to resolve the dispute. If the afore mentioned
methods are not successful then any dispute relating to this Agreement shall be decided in the
Yakima Superior Court in accordance with the laws of Washington. If both parties consent in
writing, other available means of dispute resolution may be implemented including but not
limited to final and binding arbitration.
6. Any notice herein provided to be given to the City shall be addressed and
delivered to the City Manager, Yakima City Hall, 129 North Second Street, Yakima,
Washington, 98901. Any notice to be given to the CTC shall be addressed and delivered to the
Executive Director, Capitol Theatre, 19 South Third Street, Yakima, Washington 98901.
7. The waiver of either the City or CTC of the breach of any provision of this
Agreement by the other party shall not operate and/or be construed as a waiver of any subsequent
breach by either party or prevent either party thereafter enforcing such provision.
8. If any portion of this Agreement is held to be invalid, the remainder of the
terms and conditions of the Agreement shall remain in full force and effect.
9. Any provision of this Agreement which imposes an obligation after
termination or expiration of this Agreement shall survive the term or expiration of this agreement
and shall be binding on the parties to this Agreement.
10. This Agreement shall be governed by and construed in accordance with
the laws of the State of Washington. The venue for any action to enforce or interpret this
Agreement shall lie in the Superior Court of Washington for Yakima County, Washington.
IN WITNESS WHEREOF, the parties have hereunto set their hands the day and year first
above written.
CITY OF YAKIMA
ATTEST:
By By
R. A. Zais, Jr., ty Manager
CAPITOL THEATRE COMMITTEE, INC.
By
CITY CONTRAC f NO
RESOLUTION NO' DO9� /DO
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Debbie Moore
EXHIBIT "A"
CAPITOL THEATRE OPERATING AGREEMENT
Pursuant to paragraph B.1 of the Agreement, following is a schedule of major upkeep,
maintenance and repair which shall be the obligation of the City:
A. System Maintenance
1. Air Handling System and Controls
2. Air Conditioning Equipment, Associated Pumps, Controls, etc.
3. Heating Equipment
4. Pump Motors
5. Elevator
6. Orchestra Pit Mechanism
7. Sound System
8. Lighting Control System
The City will furnish to CTC a maintenance schedule and/or other information relative to
the means by which the maintenance and repair work is to be accomplished on the foregoing
items, which maintenance schedule may be revised from time to time by the City, with
information relative to any such revision also to be furnished to CTC. Additionally; CTC shall
advise the City, in writing, of necessary repairs, maintenance and upkeep needed when such are
identified.
B. Periodic Refurbishing
The City shall periodically refurbish the Theatre building, as shall be necessary by mutual
agreement of City and CTC.
C. Damage - Repair
Pursuant to paragraph A.2. of the Agreement, the City shall be responsible for the repair
or replacement of Theatre premises, property and fixtures for any amount in excess of $2,000 for
each incident or item of damage or repair, or if the total annual aggregate exceeds $25,000, not
covered by insurance nor otherwise reimbursable to CTC, unless the damage or necessity for
repair was caused by CTC or results from the negligent use of the premises by CTC or from the
failure of CTC to perform routine repairs and maintenance as contemplated by this Agreement;
in such cases the CTC shall be fully and solely responsible for payment of damages or repairs.
The parties agree that this schedule, and the provisions of paragraphs A.2. and B.1. of the
Agreement, shall be reviewed from time to time with a view toward CTC undertaking some or
all the responsibilities of the City; and if the parties agree, this schedule and paragraphs A.2. and
B.1. shall be then amended, accordingly.
A-1
BUSINESS OF THE CITY COUNCIL
YAKIMA, WASHINGTON
AGENDA STATEMENT -
Item No.
For Meeting Of 7- 7 09
ITEM TITLE: A Resolution authorizing and directing the City Manager to execute an Operating
Agreement with the Capitol Theatre Committee to provide for regular operations
at the Theatre and setting terms and conditions under which the Theatre will be
managed
SUBMITTED BY: Finance Department
CONTACT PERSON/TELEPHONE: Rita DeBord, Finance Director 575-607
Tim Jensen, Treasury Services Officer 575-6076r
SUMMARY EXPLANATION: The existing Operating Agreement between the City and the Capitol
Theater Committee expired on June 30, 2009 and is not renewable. Staff has taken this
opportunity to update language, adjust certain conditions and terms of the Agreement, and make
several minimal housekeeping improvements to the agreement. Substantive changes include; 1)
per the recommendation of the City's insurance brokers, increased the umbrella liability coverage
the CTC carries from two to five million dollars; 2) make the agreement perpetual, with windows
every three years for necessary alterations; and, 3) added language whereby the CTC covenants
not to take any actions that will jeopardize the tax-exempt status of any bonds the City issues on
its behalf. These changes are incorporated in the attached document. Council's approval of this
Resolution will provide for a perpetual, yet flexible arrangement with the CTC into the future.
Resolution X Ordinance _ Other (Specify)
Contract X Mail to (name and address): Capitol Theatre Committee Attn: Steve Caffery 19 S 3rd Street Yakima, WA 98901
Phone 853-8000
Funding Source
APPROVED FOR SUBMITTAL:
ity Manager
STAFF RECOMMENDATION:
BOARD/COMMISSION RECOMMENDATION:
COUNCIL ACTION:
Legal/Bp
rev. effective 7/21/92