The City has contracted with the County to provide animal care services since July 1982.  The services provided include animal control services, animal care special services, animal shelter services and barking dog complaint services.  Animal control services are those services provided by animal care officers in the field, including the apprehension of stray animals and the investigation of animal related complaints.  Special services consist primarily of licensing animals and animal related facilities.  Animal shelter services are those services provided by the animal shelter, including the impounding of animals. 

The charge to the City for animal care services is based on the City's level of use.  For field services, the City is charged a portion of the total cost of providing field services in the County, based on the City percentage of the total field actions performed.  The charges for special services are based on the City's proportion of total animal licenses.  For animal shelter services, the City is charged on the basis of animal charge days for animals impounded from within City limits, or received from City residents.  The City’s cost for barking dog complaint services is determined by applying the City’s percentage of barking dog complaints to the total cost of providing these services.  

In general, the services provided by the County have been very good.  However, over the past five years, the cost for animal care services has increased substantially.  In Fiscal Year (FY) 2011-12, the City paid $729,163 for animal care services; in FY 2014-15, the City paid $956,296 for animal care services; and for FY 2015-16, costs are projected to be $1,350,000.

Additionally, due to the age and condition of the existing shelter, the County believes it is now desirable to construct a new animal shelter in which enhanced shelter and care services can be provided.  The new Orange County Animal Shelter will be built on 10 acres of land at the former Tustin Marine Base located at the intersection of Armstrong Avenue and Bell Avenue.  A Request for Proposal (RFP) was issued in December 2015 for a design/build contract and proposals are currently being evaluated. 

The County is asking its 18 contract cities to contribute a majority of the funds to construct the new facility, which will have a maximum cost of $35 million.  The County is contributing the land, plus $5 million toward the project.  Garden Grove’s share is estimated to be $4,142,755 (see Attachment 1).

Presently, the County is seeking long-term commitments from cities by April 1, 2016.  These commitments and related agreements are expected to have a 10-year term, with cities contributions toward the new shelter being financed over the ten-year period.  Therefore, in addition to the annual cost for animal care services, the City would be obligated to pay an additional annual payment of approximately $430,828 for the new shelter.  The projected cost for FY 2016-17 for animal care services, including the new shelter payment is $1,780,828. 

Review of Alternative Animal Care Options

Due to the substantial cost increase over the past several years for animal care services and the County’s request for a long-term commitment toward construction and operation of a new shelter, staff has explored and evaluated potential alternative animal care service options. 

The Orange County Humane Society (OCHS) has submitted a proposal and term sheet for the provision of animal care and shelter services to the City (see Attachment 2).  According to the proposed terms, animal care and shelter services would be provided at an estimated annual flat rate cost of $290,000 for up to 3,500 animals and $310,000 for up to 3,900 animals for a five year term. The term sheet also includes a one-time financial contribution of up to $25,000 toward the expansion of OCHS facilities for a new drop-off/remote office that would provide additional space to accommodate the City’s animal shelter needs.  Shelter service would begin within six months of execution of a formal agreement.  The proposal from OCHS does not include field or animal licensing services.  Therefore, these services would need to be undertaken by City staff. 

Aside from the County and OCHS, there are no other services providers that can accommodate the City’s animal care and shelter needs at this time.  

Contracting with the County for field and shelter animal care services is estimated to cost $1,780,828 per year, including the new shelter payment.  Contracting with OCHS for animal shelter services is estimated to cost approximately $335,000 per year for animal shelter and related services.  Field and licensing services can be conducted by City staff at an estimated cost of under $700,000.

It is recommended that the City Council:

• Approve the attached term sheet setting forth the proposed terms and conditions for the provision of animal care and shelter services by the Orange County Humane Society to the City of Garden Grove;
  
  
• Authorize the City Manager to negotiate and execute an agreement with the Orange County Humane Society based on the terms outlined in the attached term sheet;
  
  
• Direct staff to terminate the existing agreement with the County upon execution of the agreement with Orange County Humane Society; and
  
  
• Direct staff to advise the County in writing that the City will not enter into a participation agreement for a new animal shelter.