Honorable Mayor and Members of the City Council Phil Kamlarz, City Manager. William Rogers, Acting Director, Parks Recreation & Waterfront

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1 Office of the City Manager To: From: Submitted by: Subject: Honorable Mayor and Members of the City Council Phil Kamlarz, City Manager CONSENT CALENDER October 28, 2008 William Rogers, Acting Director, Parks Recreation & Waterfront Contract No. R7572 Amendment of License Agreement with Young Kim dba Bay Point Sales (bait shop at Berkeley Marina) RECOMMENDATION: Adopt a Resolution authorizing the City Manager to execute an amendment to the license agreement Contract No. R7572 with Young Kim doing business as Bay Point Sales at 225 University Avenue in Berkeley, California that commenced on April 22, 2008 and runs through December 31, FISCAL IMPACTS OF THE RECOMMENDATION Revenue from this license agreement is deposited in the Marina Enterprise Fund Budget Code ; Contract Management Services number is F2FQU. The current license agreement with Bay Point Sales commenced on April 22, 2008 and has the following payment terms to the City: a) a monthly license rental fee; b) a fee of 5% of gross sales on certain items sold in the shop; and c) a $1.00 per passenger loading fee to cover charter boat activity. The monthly license rental fee was set at $1,800 per month, which would have generated $163,943 in revenue to the City over the term of the license agreement. This amendment will reduce the license rental fee from $1,800 to $900 for the period of April 22, 2008 through December 31, 2008, after which the monthly fee will return to $1,872 (base rent plus annual 4% increase). This amendment will decrease the total revenue due to the City for the minimum monthly license fee for the nearly seven-year term of the license by $7,470 from $163,943 to $156,473. CURRENT SITUATION AND ITS EFFECTS On May 1, 2008, the federal Pacific Fishery Management Council voted to close the California salmon sport fishing season due to the low salmon count. This had a significant impact on the sale of bait at the bait shop at the Berkeley Marina, and Young Kim, operator of the bait shop, requested a temporary reduction in the monthly license fee owed to the City. In an effort to maintain Young Kim as a tenant, staff recommend amending the license agreement to reduce the monthly rental fee from $1,800 to $ Milvia Street, Berkeley, CA Tel: (510) TDD: (510) Fax: (510) manager@ci.berkeley.ca.us Website:

2 Contract No. R7572 Amendment of License Agreement CONSENT CALENDAR with Young Kim dba Bay Point Sales October 28, 2008 for the period of April 22, 2008 through December 31, This will help the bait shop to remain in business and avoid defaulting on their license agreement with the City. BACKGROUND There has been a bait shop at the Berkeley Marina for many decades and is known as the Berkeley Marina Sport Center. Upon completion of a request for proposal process in December 2007, the City selected Young Kim, operator of Hana Japan at the Berkeley Marina, to operate the bait shop and executed a license agreement that commenced on April 22, RATIONALE FOR RECOMENDATION The salmon sport fishing season in California is extremely variable from year to year. Due to the closure of the California salmon sport fishing season this year by the federal Pacific Fishery Management Council, sales at the bait shop were significantly impacted. A one-time reduction in the monthly license fee for the year 2008 will allow the current operator of the bait shop, Young Kim, to comply with the terms of the license agreement, and continue to offer amenities (food items, sundries, and bait when needed) to the visitors to the Berkeley Marina. Beginning January 1, 2009, the monthly fee will resume at $1,872 (the initial monthly rental amount with a 4% increase). ALTERNATIVE ACTIONS CONSIDERED None CONTACT PERSON John Mann, Waterfront Manager, Attachments: 1: Resolution Exhibit A: Amendment to License Agreement Page 2

3 RESOLUTION NO. -N.S. LICENSE AMENDMENT TO CONTRACT NO. R7572 WITH YOUNG KIM TO USE CITY PROPERTY AT 225 UNIVERSITY AVENUE TO OPERATE THE BAIT SHOP AT THE BERKELEY MARINA UNTIL DECEMBER 31, 2014 WHEREAS, on March 25, 2008 the Berkeley City Council approved of the License Agreement With Young Kim (Resolution No. 64,005); and WHEREAS, due to the closure of the California salmon season in 2008 by the federal Pacific Fishery Management Council, Young Kim, current operator of the bait shop, requested a temporary reduction in the monthly license fee owed to the City; and WHEREAS, City staff has reviewed the request and determined it to be fair and equitable to all parties; and WHEREAS, the amended license agreement will be effective April 22, 2008 to December 31, The monthly license fee will decrease from $1,800 to $900 for the remaining months of 2008 (April 22 through December 31, 2008). This amendment will decrease the total revenue to the City for the term of the license by $7,470 from $163,943 to $156,473. Beginning January 1, 2009, the monthly fee will resume at $1,872 (the initial monthly rental amount with a 4% increase); and WHEREAS, this license agreement provides income to the Marina Enterprise Fund (budget code ). CMS No. F2FQU. NOW THEREFORE, BE IT RESOLVED by the Council of the City of Berkeley that the City Manager is authorized to execute an amendment to Contract No. R7572 with Young Kim for the use of 225 University Avenue on the Berkeley for a decrease in the monthly license fee from $1,800 to $900 for the period of April 22, 2008 through December 31, A record signature copy of said agreement and any amendments (Exhibit A) to be on file in the Office of the City Clerk.

4 EXHIBIT A AMENDMENT TO LICENSE AGREEMENT This license amendment ( Amendment ) is made on, between the CITY OF BERKELEY ( City ) and YOUNG KIM doing business as Bay Point Sales ( Licensee ), who agree as follows: This Amendment is made with reference to the following facts and objectives: A. The City entered into a License Agreement with Licensee on April 21, 2008 ( License ) to use the City s property, consisting of use of the name (a) the Berkeley Marina Sports Center, (b) the primary phone numbers for the BMSC and (c) ground floor space in the building located at 225 University Avenue, as set forth in the License. A copy of the License is attached hereto as Exhibit A. B. In the License, the City and Licensee agreed to an initial term, beginning on April 22, 2008 and ending December 31, C. Because the federal Pacific Fishery Management Council closed the 2008 California salmon sport fishing season, Licensee wishes to reduce the base monthly fee from $1,800 per month to $900 per month for the remainder of the year Therefore, the City and Licensee agree as follows: 1. Section 2 FEE, subsection (a) of the License is replaced as follows: a. In consideration for the rights conveyed by this License, Licensee shall pay to City a fee of NINE HUNDRED DOLLARS ($900.00) per month for calendar year 2008, starting on April 22, Beginning on January 1, 2009, the monthly fee will be $1,872 and each January 1 thereafter through January 1, 2014, the license fee will increase FOUR (4%) each and every year. If an Option is granted pursuant to Paragraph 3.c, the fee for the option period to begin at market rate determined by negotiation, but in no event shall the fee for the option period be less than TWO THOUSAND THREE HUNDRED SIXTY-NINE DOLLARS ($2,369) per month for the first year (a FOUR (4%) increase over the last year of the initial term.) If the parties have not agreed to a higher rate, the fee for the remaining years of the option period will increase FOUR (4%) per year. Additionally, Licensee will pay $100 per month into a capital fund for Marina access and infrastructure capital projects that benefit the structure at University. Use of these accumulated capital funds will be at the discretion of the Waterfront Manager in consultation with Bay Point Sales. The monthly fee shall be as follows: Year 2009 $1,872 per month, Year 2010 $1,947 per month, Year 2011 $2,025 per month, Year 2012 $2,106 per month,

5 Year 2013 $2,190 per month, Year 2014 $2,278 per month. 2. In all other respects, the License Agreement dated January 12, 2004, shall remain in full force and effect. IN WITNESS WHEREOF, City and Licensee have executed this Amendment as of the date written on the first paragraph above. CITY OF BERKELEY BY: APPROVED AS TO FORM: City Manager City Attorney REGISTERED BY: ATTEST: City Auditor Deputy City Clerk LICENSEE THE BERKELEY MARINA CHARTER BOAT ASSOCIATION, INC.: By: Title: City of Berkeley Business License No.

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