TO: LINDA REICH, CITY MANAGER
FROM: HYE JIN LEE, DIRECTOR OF PUBLIC WORKS
SUBJECT
title
Final Acceptance of Public Improvements for the Kaiser Medical Office Buildings (PL15-0100), located at 3750 Grand Avenue.
end
RECOMMENDATION
recommendation
1) Approve a settlement agreement between the City of Chino and Kaiser Foundation Health Plan, Inc. for required public improvements in the City of Chino per the Americans with Disabilities Act and California Law; 2) accept public improvements as complete for PL15-0100; 3) authorize release of the performance bond and initiate the warranty period; and 4) authorize the City Manager to execute the necessary documents on behalf of the City.
body
FISCAL IMPACT
Approval of the settlement agreement is not anticipated to result in any immediate fiscal impact. The payment by Kaiser Foundation Health Plan, Inc. to the City in the amount of $188,925.40 is anticipated to cover costs for the City to remove and replace public improvements which are the subject of the Settlement Agreement as part of a capital improvement project. These funds will be set aside in a Balance Sheet reserve account in the Fund 320 until the improvements occur.
CITY OF CHINO MISSION / VISION / VALUES / STRATEGIC ISSUES
The recommendation detailed above further the City’s values and strategic issues that serve as key pillars on which identified priorities, goals, and action plans are built, by fostering:
• Financial Stability
• Positive City Image
• Public Service Excellence through Internal and External Partnerships
|
Revenue: |
Expenditure: |
|
Transfer In: |
Transfer Out: |
BACKGROUND
On November 16, 2015, the City of Chino Planning Commission conditionally approved PL15-0100 (Site Approval) for the construction of the Kaiser Medical Office Buildings on an 8.23-acre site located at 3750 Grand Avenue, near the northwest corner of Grand Avenue and Roswell Avenue (Exhibit A).
As a condition of approval, Kaiser Foundation Health Plan, Inc. was required to construct various public improvements, including street pavement, curb, gutter, sidewalk, and traffic signal modifications along Roswell Avenue and at the intersection with Grand Avenue. To guarantee completion of these improvements, the City Council approved a Public Improvement Agreement (PIA) and associated security bonds on November 15, 2016 (Exhibit B).
The required improvements included removal and replacement of the existing sidewalk along the project's Roswell Avenue frontage and extending south to the northwest corner of the Grand Avenue/Roswell Avenue intersection. These improvements were necessary to accommodate the widening of the west side of Roswell Avenue for a new southbound right-turn pocket identified in the project's traffic study to mitigate project-related traffic impacts.
The public improvements were constructed between 2016 and early 2017. During final inspection, City staff determined that portions of the newly constructed sidewalk and a curb ramp did not comply with City standards and the accessibility requirements of the Americans with Disabilities Act (ADA). The identified deficiencies included inadequate sidewalk widths around existing obstructions, such as streetlights and fire hydrants, and cross slopes exceeding the maximum allowable ADA standard.
In response, Kaiser retained an ADA consultant to independently evaluate the improvements. The consultant's findings confirmed multiple accessibility deficiencies, which were documented in a report completed in late 2017. Kaiser subsequently directed its contractor to reconstruct approximately 40 sidewalk panels, representing roughly 70 to 80 percent of the originally installed sidewalk. This work was completed between late 2017 and early 2018.
Following the reconstruction, Kaiser's consultant conducted another evaluation and identified additional deficiencies requiring correction. Kaiser completed a second round of corrective work, replacing a smaller number of sidewalk panels. After the work was completed, the consultant performed a final field review and concluded that the previously identified deficiencies had been corrected and that the improvements complied with applicable accessibility standards.
In September 2020, City staff conducted a follow-up inspection as part of the project closeout process. The inspection identified remaining ADA-related deficiencies similar to those previously noted, including inadequate sidewalk widths and excessive cross slopes. As a result, the public improvements were not accepted, and the Public Improvement Agreement and associated security bonds remained active.
Little additional progress occurred until September 2023, when Kaiser contacted the City to discuss project closeout. Kaiser maintained that all deficiencies identified by its ADA consultant had been corrected and indicated it was not willing to perform additional reconstruction because the project had been closed internally several years earlier. Since that time, City staff and the City Attorney's Office have worked with Kaiser representatives to resolve the outstanding dispute regarding the remaining public improvements.
ISSUES/ANALYSIS
The Kaiser Medical Office Building project is one of nine (9) development projects with outstanding public improvements that have not been formally accepted by the City. The remaining dispute centers on whether certain pedestrian improvements comply with applicable ADA accessibility requirements.
After evaluating available options, City staff determined that negotiating a settlement agreement would provide the most efficient and cost-effective path toward resolving the matter. This approach is consistent with settlement agreements previously approved by the City Council in November 2022 for similar public improvement disputes involving development projects.
Over the past three years, City staff and the City Attorney's Office have negotiated the terms of a settlement agreement with Kaiser and its legal representatives. Both parties have now reached agreement on the proposed terms.
Under the proposed agreement (Exhibit C), Kaiser will pay the City $188,925.40, representing the estimated cost to correct the remaining ADA deficiencies, plus a contingency allowance and costs for project management and design services. The settlement amount also includes $1,000 for installation of a required traffic sign shown on the approved improvement plans that is currently missing near the intersection of Grand Avenue and Roswell Avenue. The cost estimate was prepared by Kaiser and reviewed and approved by City staff.
Upon receipt of payment within 30 days of the City's invoice, the City will accept the public improvements, exonerate the performance and labor and material bonds, and assume responsibility for completing the remaining accessibility improvements and installing the missing traffic sign. The settlement funds will be restricted for these purposes.
The proposed settlement was presented to the Infrastructure/Streets Committee on December 8, 2025. The Committee supported staff’s recommendation to proceed with presenting the agreement to the City Council. Following the Committee meeting, staff worked with Kaiser to address the remaining punch list items, which consisted primarily of as-built drawings. Staff ultimately determined that the City’s approved improvement plans accurately reflect existing field conditions, thereby eliminating the need for additional as-built drawings.
Approval of the settlement agreement will fully resolve the longstanding dispute regarding the remaining accessibility improvements and allow the City Council to formally accept the public improvements eligible for City acceptance. The improvements to be accepted include the street pavement, curb, gutter, and sidewalk improvements constructed as part of the project. The traffic signal modifications and pedestrian improvements at the intersection of Grand Avenue and Roswell Avenue are under the jurisdiction of Caltrans and are therefore not subject to City acceptance. All public improvements required as conditions of approval for the project were fully funded by Kaiser.
In accordance with the settlement agreement, Kaiser has provided one-year warranty security in the amount of $68,402, representing the prorated cost to warranty the improvements that were completed to the City's satisfaction and are not subject to the settlement agreement. During the one-year warranty period following City Council acceptance, Kaiser will remain responsible for correcting any defects in those accepted improvements. Upon acceptance, ownership, operation, and maintenance responsibility for the accepted public improvements will be transferred to the City, while improvements within Caltrans' jurisdiction, including the traffic signal modifications, will remain under Caltrans' ownership and maintenance responsibility.
In addition to Kaiser's payment of the agreed-upon settlement amount, both parties will release and waive any future claims arising from the dispute, including claims for damages, reimbursement, or attorneys' fees. Acceptance of the improvements will also allow the City to incorporate the accepted infrastructure into its routine inspection and maintenance program while using the settlement funds to complete the remaining ADA improvements and install the missing traffic sign.
Accessibility
The subject of this report directly involves accessibility improvements to the public sidewalk facilities constructed on the west side of Roswell as part of the project. Although these deficiencies have not been fully resolved to the City’s satisfaction, the proposed settlement provides funding for the City to complete the remaining improvements and bring the affected facilities into compliance with applicable ADA accessibility requirements as part of a future City project
Attachments:
Exhibit A - Vicinity Map
Exhibit B - Public Improvement Agreement
Exhibit C - Settlement Agreement