Agenda Item   



                                                                                                                        ASR Control  19-001183




legal entity taking action:

Board of Supervisors

board of supervisors district(s):


SUBMITTING Agency/Department:

County Executive Office   (Approved)

Department contact person(s):

Thomas A. Miller (714) 834-6019 



Richard Sanchez (714) 834-2830



Subject:  Health Care Agency Lease Agreement at 21632 Wesley Drive in Laguna Beach


      ceo CONCUR

County Counsel Review

Clerk of the Board


Approved Agreement to Form

Consent Calendar



3 Votes Board Majority




    Budgeted: N/A

Current Year Cost: N/A

Annual Cost: See Financial Impact




    Staffing Impact:


# of Positions:

Sole Source: N/A

    Current Fiscal Year Revenue: N/A

  Funding Source: See Financial Impact

County Audit in last 3 years: No



    Prior Board Action: 01/29/2013 #9, 11/09/2010 #14, 03/17/2009 #12, 11/17/1998 #8






Find the project is categorically exempt from California Environmental Quality Act (CEQA), Class 1 (Existing Facilities) pursuant to CEQA Guidelines, Section 15301.



Approve and execute a new Lease Agreement with Laguna United Methodist Church for 3,800 square feet of office space located at 21632 Wesley Drive, Laguna Beach, CA, for Heath Care Agency use, for a term of five years, commencing on December 1, 2020, through November 30, 2025, with one five-year option to extend.



Authorize the Chief Real Estate Officer or designee to execute subsequent lease amendments and option terms that make non-monetary and/or monetary changes that do not increase County costs by more than $50,000 per year.







Approval of a new five-year Lease Agreement with Laguna United Methodist Church will allow for Health Care Agency's use of 3,800 square feet of office space located at 21632 Wesley Drive, Laguna Beach, CA, for its Children and Youth Behavioral Health Services.






Since September 25, 1984, the Health Care Agency’s (HCA) Children and Youth Behavioral Health (CYBH) program has occupied 3,800 square feet of office and clinic space at 21632 Wesley Drive in Laguna Beach (Existing Premises) for its South Orange County CYBH outpatient clinic (Original Lease). Laguna United Methodist Church (Lessor) owns and operates the Existing Premises. From September 1984 through November 1998, CYBH occupied the space under a donated space agreement. On November 17, 1998, your Board of Supervisors (Board) approved the Original Lease for a new five-year lease through November 30, 2003, with an option to extend for an additional five years. On November 23, 2003, your Board approved the five-year lease extension effective December 1, 2003, through November 30, 2008.


Subsequently, a First Amendment to the Original Lease was approved by your Board on March 17, 2009, that extended the term of the existing lease through November 30, 2010. A Second Amendment to the Original Lease was approved by your Board on November 9, 2010, that extended the term of the existing lease through November 30, 2015, with a new option to extend for an additional five years. A Third Amendment to Lease was approved by your Board on January 29, 2013, that revised the number of non-exclusive parking spaces and fixed the rent for the remainder of the Lease Amendment term. All other terms and conditions of the Original Lease remained the same. On September 30, 2015, the Chief Real Estate Officer executed the five-year lease extension effective December 1, 2015, through November 30, 2020.


CYBH provides a broad range of services for behaviorally, emotionally or mentally disordered children and adolescents as well as counseling services for families at this location. Services include mental health evaluation, psychotherapy/counseling to individuals, families and groups, medication management, crisis intervention and collateral services to parents and families. Consultation to schools and other local education agencies, coordination with private and public services and case management are also provided.


The Existing Premises continues to provide excellent access to services for South Orange County clients from surrounding Laguna Beach, Newport Beach, Laguna Niguel and Dana Point cities, with ease of accessibility thereby decreasing barriers to client services. In addition to occupying 3,800 square feet, CYBH can use the church kitchen and meeting rooms at no additional change. CYBH has building and directional signage onsite. Staff and clients have sufficient parking spaces at the onsite parking lot at no additional cost. The Current Lease will expire on November 30, 2020, with no options to extend the term. HCA desires to continue to occupy the Existing Premises and continue operating services that are consistent with HCA’s program goals and allow flexibility for future program requirement needs. 


CEO Real Estate negotiated a new lease for a five-year term with one additional five-year option to extend the term thereafter with advanced written notice of at least nine months (Proposed Lease). Under the terms of the Proposed Lease, the starting rental rate will be $1.42 per rentable square foot (Rent), an increase from $1.22 per rentable square foot to adust for rising building operation costs, below market for the Laguna Beach area. The Proposed Lease is a full-service gross lease, with no additional pass-throughs for the building operating expenses, and two percent annual Rent increases. The Rent during the extension term will be a fixed rate of no more than a two percent increase of the immediately preceding Rent paid by County. The Proposed Lease allows an ongoing termination option at any time during the term upon providing Lessor at least 90 days’ notice of said termination date. Lessor will provide 13 parking spaces for County’s use within the onsite parking lot, utility services, excluding telephone service, and maintenance of the Premises in good order and condition in compliance with all applicable laws. The term of the Proposed Lease shall commence on December 1, 2020.


Legal Requirements:

Compliance with CEQA: The proposed project is Categorically Exempt (Class 1) from the provisions of CEQA pursuant to Section 15301, because it involves the lease of existing office facility involving negligible or no expansion of an existing use.

General Plan: The project was previously found to conform to the General Plan of the City of Laguna Beach pursuant to a letter dated July 11, 2008. The square footage under the Proposed Lease and County’s use has remained consistent since that letter.






Appropriations for this Proposed Lease will be included in HCA’s Budget Control 042 FY 2020-21 Budget and in the budgeting process for future years. 


72% (2011 Realignment - Early and Periodic Screening, Diagnostic and Treatment; Mental Health Realignment; Senate Bill 75)


28% (Federal Financial Participation Medi-Cal)


The below table of fiscal-year costs is based upon a December 1, 2020, commencement date.

FY 2020-21

 $   37,800.00

FY 2021-22

 $   65,556.00

FY 2022-23

 $   66,867.12

FY 2023-24

 $   68,204.44

FY 2024-25

 $   69,568.51

FY 2025-26

 $   29,225.65












Health Care Agency




Attachment A- Lease GA1254-141
Attachment B- Acquisitions Questionnaire
Attachment C- Lease Summary