Jun 17 2012

Piedmont Blair Park Expenses On City Council Agenda June 18

Piedmont Recreation Facilities Organization Debt to City is “Under Discussion” – 

A June 18th staff report to the City Council by City Administrator Geoffrey Grote outlines the City’s total outside vendor expenditures for the now defunct Blair Park sports field project and Coaches Field.

The expenditures, compiled by Finance Director Mark Bichsel, total $793, 956 for Blair Park and $103,234 for a plan to install lights and artificial turf on Coaches Field.  The $897,191 grand total is for outside consultants and services and does not include the substantial costs of time estimated at almost $250,000 spent by City recreation, planning, and administrative staff over the past four-plus years on both of the failed projects.

Grote’s report states that Piedmont Recreational Facilities Organization (PRFO) owed the City a total of $303,588 for expenses dating from March 21, 2011 (the date the Council voted that all expenses for the Blair Park sports field proposal be paid by PRFO)  through April 2012.  To date PRFO has paid the City $118,000 of this amount and still owes $220,267.  Grote states that, based on the Council’s March 21, 2011 decision, City expenses incurred for Blair Park before that date, with the exception of “previously received gifts” will not be billed to PRFO.

To date, the City has received $379,200 in “donations” for Blair Park.  If PRFO pays its outstanding balance of $220,267, that will leave the City with costs of $194,489 in outside consultant and other expenses for the Blair Park project. This amount, plus $246,187 in estimated City staff time, adds up to a total of $440,676 in City expenditures.

Although PRFO made a binding “Reimbursement and Indemnification Agreement” with the City to pay all legal expenses related to Blair Park, the City has not billed PRFO for any expenditures between January and April 2012, because, according to Grote, “These expenses are the subject of ongoing discussions.”  At the same time he notes that the City is holding onto a $125,000 deposit from PRFO as a guarantee of the indemnity agreement.

Grote concludes, “It is unlikely that we will know the totality of financial circumstances of this project until all legal matters are concluded, primarily the issue of attorney’s fees in the matter of Friends of Moraga Canyon v. Piedmont.”

The full staff report can be viewed at http://www.ci.piedmont.ca.us/citycouncil/
Listed under Staff Reports: b. From the Private Contributions fund to the CIP Blair Park Account (127-0432-006-001) in the amount of $118,000

3 Responses to “Piedmont Blair Park Expenses On City Council Agenda June 18”

  1. Is this $897,191. + $250,000. the GIFT that Piedmont Recreation Facilities Organization gave the City of Piedmont/taxpayers of Piedmont???

  2. According to Geoff Grote “these expenses are the subject of ongoing discussions.” The Aug. 12, 2011 indemnification/reimbursement agreement (“agreement”) states in plain language in recitals D and E and notably at Sec 1, Purpose of Agreement, that “PRFO will pay for legal and consultant costs directly or indirectly incurred by City.” Further language is also plain that PRFO will pay all CEQA costs and costs “not limited to CEQA.” Sec 6(a) states PRFO “shall remain liable for all eligible costs” should it withdraw. All direct and indirect costs related to Blair Park are eligible; there is no legitimate reason for “ongoing discussion” about the expenses.

    Rather than present PRFO with a bill as the agreement calls for, the discussion has now turned to the viability and legality of the agreement. The agreement calls for binding arbitration should there be a dispute; while this would be an unfortunate outcome, the prospect of Council unilaterally relieving PRFO of a legal obligation will result in increased taxpayer cost for a project that was well publicized as a gift. “No taxpayer cost” was often heard from PRFO board members; the reality is a “gift” that will cost taxpayers minimally half a million dollars . . . if we’re lucky.

  3. Most likely PRFO has no money, so obtaining an arbitration award against it will be meaningless. There’s no recourse against any of the PRFO backers, is there? If not, the entire indemnification agreement was a joke. The city should have required a bond or personal guarantees.

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