In March of 2023, City Council authorized and directed the City Manager to make necessary changes to enable the City to enter into a Cooperative Agreement with the State.  On May, 30, 2023, the Cooperative Agreement was executed.  The purpose of the Cooperative Agreement is to allow the City to install fencing and decorative paving and gravel on unpaved slopes and narrow areas within the City on Route 22 from Springdale Street to Garden Grove Boulevard (the “Project”).  The Cooperative Agreement further establishes funding from the State in an amount not to exceed $600,000 (on a reimbursement basis) to implement the Project.

A draft encroachment permit has been prepared by the State of California, acting through its Department of Transportation ("Caltrans") to allow the City access to Caltrans right-of-way to implement the Project; however, the issuance of the encroachment permit is subject to execution of the DMA.  The DMA obligates the City to keep the Caltrans right-of-way areas in a safe and operational condition.  Maintenance obligations include but are not limited to litter, debris, and graffiti removal, repairs, and restoration.  The DMA provides funding of up to $230,000 for maintenance. These funds are in addition to the $600,000 appropriated under the Cooperative Agreement to install the Project.  The DMA can be terminated by the City with a thirty day notice.

The City solicited bids per the normal procurement procedure for the Project; however no bid proposals were received; therefore per the City's Municipal Code and procurement procedures, the City can sole-source a contract when in the City's best interest to do so.  Staff has recently identified a contractor capable and interested in the work but has yet to receive their proposal.  The amount is expected to exceed the City Manager's signing authority and would therefore have to come back to City Council for approval.   One of the Caltrans right-of-way areas subject to the Cooperative Agreement was cleared on Friday, September 1st and as of Wednesday, September 6th the area was already encumbered by litter and debris.  Installing the Project will facilitate the City's ability to keep the areas in a safe and operational condition.  Staff is requesting that the City Council authorize the City Manager to execute a contract with a contractor in an amount not to exceed the State funding of $600,000 in order to install the Project in the most timely manner.

There is no fiscal impact on the General Fund as a result of approving the DMA. Caltrans is providing funding for up to $230,000 for maintenance activities.  Once the funding is exhausted, the City staff will explore additional Caltrans funding options or pursue termination of the DMA. 

It is recommended that the City Council: 

• Authorize and direct the City Manager, or her designee(s) to execute the Delegated Maintenance Agreement with Caltrans and make necessary changes as appropriate there to, on behalf of the City;
• Authorize the City Manager, or her designee(s), to exercise option terms and sign the amendments;
• Authorize the City Manager to enter into a contract, as approved by the City Attorney, to install the Project for an amount not to exceed the State funding of $600,000; and 
• Appropriate funds per the Delegated Maintenance Agreement with Caltrans.

By: Jeff Brown, Sergeant, Special Resource Team