HomeMy WebLinkAboutE-10 Staff Report - Control Air Agreement TransferCONSENT ITEM
E-10
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
VIA: SERGIO GONZALEZ, CITY MANAGER
FROM: DANIEL BOBADILLA, P.E., DIRECTOR OF PUBLIC WORKS/CITY ENGINEER
DATE: JUNE 3, 2019
SUBJECT: AUTHORIZATION TO TRANSFER EXISTING MAINTENANCE SERVICES
AGREEMENT WITH CONTROL AIR CONDITIONING SERVICE CORPORATION
TO CONTROL AIR ENTERPRISES LLC
BACKGROUND:
The City has contracted with Control Air Conditioning Service Corporation (CACSC) for HVAC
maintenance and repair services since July 1, 2016, with a one-year extension through June 30, 2020
approved on April 1, 2019. CACSC is going through a reorganization transaction in which it will
become wholly owned by a newly formed Delaware holding company having substantially the same
owners and the same management. As part of the reorganization transaction, CASC will be merged into
Control Air Enterprises LLC, a Delaware limited liability company, which will be a wholly owned
subsidiary of the holding company. Accordingly, CACSC is requesting authorization from the City to
transfer its existing maintenance services agreement to Control Air Enterprises LLC. All contract terms
and conditions will remain the same, owners will remain substantially the same, and management will
remain the same.
RECOMMENDATION:
Staff recommends the City Council take the following actions:
1)Approve the transfer of an existing maintenance services agreement with CACSC to Control Air
Enterprises LLC; and
2)Authorize the City Manager to execute the Consent to Transfer/Assignment of Maintenance
Services Agreement, in a form acceptable to the City Attorney, on behalf of the City.
ANALYSIS:
On June 6, 2016, City Council awarded the HVAC maintenance and repair contract to CACSC. This
contract is effective through June 30, 2020, with one remaining one-year extension available.
APPROVED
CITY COUNCIL
6/3/2019
Transfer of Maintenance Services Agreement with CACSC
June 3, 2019
Page 2
Recently, CACSC began engaging in a corporate reorganization transaction in which it will become
Control Air Enterprises LLC, a newly formed Delaware holding company having substantially the same
owners and the same management. The City’s consent is required for the effectiveness of the
assignment. Section 3.5.7 of the existing agreement allows a transfer of the agreement with consent from
the City. Transfer of the agreement will not create an adverse impact as key staff currently providing the
required maintenance services to the City will continue providing the same services. In addition, the
terms and conditions of the existing agreement will remain in full force and effect.
FISCAL IMPACT:
There is no fiscal impact associated with the recommended actions.
Prepared by: Reviewed and Approved:
Nikki Rosales Daniel Bobadilla, P.E.
Senior Management Analyst Director of Public Works/City Engineer
Reviewed and Approved:
Sergio Gonzalez
City Manager
Attachment:
1) Consent to Transfer/Assignment
2) Existing Maintenance Services Agreement
Attachment 1
Attachment 2