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2022/01/13 KPC Global Medical Centers, Inc. KPC Global Medical Centers, Inc. MOU between the City of MenifeeMEMORANDUM OF UNDERSTANDING This MEMORANDUM OF UNDERSTANDING ('MOU") is entered into this /J day of January,2022 (lhe "Effective Date"), by and belween the CITY OF MENIFEE, a California municipal corporation ("City"), and KPC GLOBAL MEDICAL CENTERS, lNC. ('KPC"), on the terms and provisions set forth below. City and KPC are collectively referred to herein as the "Parties" and are each individually referred to herein as a "Party." RECITALS B. Since the City's incorporation in 2008, its population has grown by more than over 80%, and the City now has over '105,000 residents, and over 800,000 people in its trade area. The City and its regional partners have colleclively been working to improve lhe quality of life for the City's communily members and the region. As part of that effort, the City and its regional partners have sought to expand and grow needed health care services locally. C. The City's Economic Development Department recently completed a Comprehensive Economic Development Strategy ('CEDS). The CEDS focused industry outreach for the plan to four main categories, one of which is healthcare firms and medical facilities. D. The City can better diversify its local economy, support localjob creation, economic growth, and address the physician and nursing staffing needs of lhe growing region by supporting and expanding clustered healthcare amenities and services. Such services include family healthcare programming, children's services, physicians specialized networks and care, nursing and physician medical programs and schools. E. KPC is the owner and operator of the Menifee Global Medical Center, located at 28400 McCall Blvd, Menifee, CA 92585 ("Medical Facility"). KPC's mission is to support and maintain a full range of specialty services for both Menifee's inpatient and outpatient acute care needs at the Medical Facility. KPC seeks at the Medical Facility to provide Menifee residents and the surrounding region with the most comprehensive, personalized treatment plan avarlable in the healthcare industry. ,*4 Page I of9 A. The City of Menifee is consistently working to develop and build a safe, thriving, and premier place to be. ln connection with that mission, the City of Menifee works with local partners, organizations, and networks to continue to increase the quality of life for its residents, businesses, and trade areas. Quality of life is maintained and improved through a variety of means, including jobs, amenities, infrastructure, education, parks, public safety, housing, and healthcare F. KPC slrives for excellence in everything it does, from providing quality care to patients of all ages, to meeting the changing healthcare needs of the surrounding communities with a fomard-thinking perspective. G. KPC is committed to being a stable, financially sound organization that supports both Menifee and local patients, and staff at the Medical Facility. H. KPC prides itself on supporting its employees by meeting their professional needs through training, acquiring and utilizing state-ofthe-art equipment, and offering competitive services at the Medical Facility. ln turn, KPC's staff are caring and committed to their patients. KPC believes open lines of communication are at the heart of quality healthcare, and accordingly emphasizes good communication at every level of engagement with staff, its patients, and the Menifee community. l. The Medical Facility is a local hospital choice, and an award-winning facility for cardiology, computerized tomography, day surgery, gastroenterology, general surgery, laboratory and palhology, neurosurgery, medical detoxification, orthopedic services, urology, speech and occupational therapy, physical therapy, and 24-hour emergency care. J. All ages of residents of Menifee and the broader region will benefit from the collaboration between the City and the KPC, with a goal of maintaining, improving, and expanding the scope and extent of services provided by KPC at the Medical Facility and in the City of Menifee. AGREEMENT NOW, THEREFORE, in consideration of the above Recitals, which are incorporated herein by this reference, and the mutual covenants and condations contained herein, lhe Parties hereto agree as follows: 1. feg[. This IIIOU shall commence as of the Effective Date and, unless earlier terminated pursuant to the terms of this MOU, shall remain and continue in effect for a period of five (5) years. The Pa(ies may extend the period of the MOU by duly authorized written mutual consent. The terms of, and progress under, the MOU shall be reviewed annually to ensure that the MOU's purposes are being fulfilled, and to make any adjustments or modifications to the MOU, if necessary. Either Party may terminate this MOU upon thirty (30) days prior written notice, with or without cause, and without penalty or liability. 2. Purpose and Scope. The purpose of this MOU is to promote excellence in healthcare at the Medical Facility and in Menifee, study opportunities to assist in KPC in growing locally the Medical Facility, explore opportunities to expand the Medical Facility, identify strategies to support the medical needs of existing and incoming residents of Ittlenifee and of the surrounding region, and identify enhancements that would develop the Medical Facility as KPC's central hub, thereby allowing Menifee to be recognized as a regional medical economic engine and hub. 3. Roles and Responsibilities, The roles and responsibilities of City and KPC under this MOU are defined below: Page 2 of9 A. KPC's Actions. During the term of this MOU, KPC shall: 1. Collaborate with the City and promote and grow KPC's development and healthcare services footprints at the Medical Facility and in the City of Menifee to (r) assist in local job creation and development at the Medical Facility, and (lr) create at the Medical Facility opportunities for workforce development experience, enhanced quality of life services, and education pathways with local institutions. 2. KPC will continue to invest in the Medical Facility by acquiring state- of{he-art equipment and innovative healthcare excellence, and by growing its resident and physician program in Menifee through the development of a physician school and nursing school at or adjacent to the Medical Facility; work to enhance the Medical Facility fagade, either by (r) building a new hospital facility at the site of the existing Medical Facility, or (rr) expanding the programming and services and facade in the existing Medical Facility. KPC will continue to work to enhance quality healthcare and services at the Medical Facility for Menifee's expanding and growing population through its identified annual community needs assessment. The expansion and growth will include, but not be limited to, the following areas of care: specialized medicine; neurosurgery; orthopedic surgery; family and children's health care; cardiology; computerized tomography, day surgery; gastroenterology; general surgery; laboratory and pathology; urology; speech and occupational therapy; physical therapy; and 24-hour emergency care, excluding behavior health and medical detoxification; and will promote the Menifee Facility as a socio-economic hub and center for cutting edge medical services and programming raising the City of Menifee as a top location to seek medical advice, assistance, and care, particularly in the areas of specialized medicine, neurosurgery services, orthopedic surgery, and family and children's health care. 3. KPC will explore - with the assistance of specialized consultants - development opportunities, community perceptions, and financial strategies, all in connection with KPC'S effort to expand the footprint of the Medical Facility and to develop and expand that facility into a thriving and successful emergency hospital and medical and nursing school campus. 4. KPC will work with the City to support City's events and programming, such as State of the City, Mayor's Healthcare ldea Exchange, industry coalitions, trade shows, webinars, community health fairs, job fairs, emergency services, clinics, and any co-identified and mutually agreed upon events, programs, events or seryices. B. City's Actions. During the term of this MOU, City shall. 1. City will study opportunities to assist KPC to (r) assist in local job creation and development, (ir) create opportunities for workforce development experience, enhanced quality of life services, and education Pagc 3 of9 pathways with local institutions, and (llr) promote and work to attract expanded medical services for Menifee's existing, growing and projected population needs. 2. The City will, in coordination and collaboration with KPC, co-promote the Menifee Facility, when possible, at appropriate City functions coordinated by City's departments of Economic Development and/or Community Services by working with KPC to co-host health fairs, job fairs, and local physician or nursing recruitment events, and work to include and notify KPC of the city's State of the City, Mayor's Healthcare ldea Exchange, lndustry Coalitions, trade shows, webinars, and any co-identified and mutually agreed upon events, programs, events or services 3. City will support, through consultant studies, development opportunities, perception studies, financial strategies, to (i) expand KPC's development and healthcare services footprints in the City of Menifee, and (ii) develop the Menifee Facility into a thriving and successful hospital and school campus that enhances the economic vitality of the KPC at the Menifee Location, thereby creating and maintaining a regional medical hub in Menifee. 4. AuthorizedRepresentatives.Each party will appoint a person/s to serve as the official contact and coordinate the activities of each organization in carrying out this MOU The initial appointees of each organization are: (City operations) Armando Villa City Manager (Workforce, iobs, industry development, business attraction/groMh/expansion and workforce/educational pathways) Gina Gonzalez, Economic Development Director qqonzalez@citvofmenifee. us (9s1)723-37't1 (Community promotions) Phil Southard, Public lnformation Officer psoutherford@citvofmenifee. us (951) 723-3777 Page 4 of9 City of Menifee: (Community services, events, programming, promotions) Jonathan Nicks, Community Services Director inicks@citvofmenifee. us (951) 723-3707 KPC Global Medical Centere, lnc.: Peter Baronoff Chief Executive Officer Menifee Global Medical Center A. MOU as Statement of lntent. While the Actions described in this MOU represent a statement of shared interest and intent, their implementation requires additional information. Neither KPC nor the City shall be bound to incur any cost or make any binding commitment in furtherance of this MOU unless and until such information is provided, evaluated, and approved to the satisfaction of KPC and/or the City (as the case may be). For example, and without limiting the scope of the foregoing, for future consultant studies under Paragraphs 3.A.5 and 3.8.3, the City and KPC will require an acceptable scope of work, an acceptable contract price, and other acceptable contract terms. The City and KPC will work diligently and in good faith to reach acceptable terms, but each retains the sole and unfettered discretion to refuse to enter into and/or approve any consultant study for any reason. B. Preservation of Discretion. The Parties each acknowled ge and agree that nothing in this MOU in any respect does or shall be construed to affect or prejudge the exercise of City's discretion concerning the consideration of any subsequent agreement, ordinance, resolution, ballot measure, or other municipal act or action ("Discretionary Action"). City retains its full and unfettered discretion to approve, deny, or decline to act upon any Discretionary Action, and nothing in this MOU is intended to or does limit or compel the exercise of the City's discretion over any Discretionary Action. C. Future Aqreements. Cit y and KPC acknowledge and agree that they have not agreed upon the essential terms of any understanding or arrangement with regard to the expansion of the Medical Facility, and that such essential terms will be the subject matter of fu(her negotiations. Notwithstanding any activities, studies, or analysis to be made by City or KPC hereunder, and/or any extension of the term of this MOU, City and KPC acknowledge and agree that any subsequent agreement concerning the expansion of the Medical Facility would not be effective until it has been considered and formally approved by the City Council (in its sole and absolute discretion) and thereafter has been executed by authorized representatives of each of City and KPC. D. No Definitive Course of Action. Notwithstandin g anything in this MOU to the contrary, neither City nor KPC intend by this MOU to commit to a definite course of action with respect to the Medical Facility or any subsequent agreement related thereto. l'agc 5 ol 9 5. NoPredetermination, 6. Assion ment KPC may not assign, hypothecate, encumber, or otherwise transfer (voluntarily or involuntarily) this MOU or any of its rights or obligations hereunder (whether in whole or in part) (each, an "Assignment") without the prior written approval of the City Manager, which approval may be given or withheld in the City Manager's sole and absolute discretion. Any Assignment City has approved shall not be effeclive unless and until KPC submits a signed assignment and assumplion agreement in a form and with content reasonably approved by the City Attorney of City 7. General Provisions A. Limitation on Remedies Sub.ject to the Parties' respective right to terminate this MOU in accordance with the terms of Paragraph 1, the Parties exclusive remedy for an uncured default under this MOU is to institute an action for specific performance of the terms of this MOU, and in no evenl shall either Party have the right, and each Party specifically expressly waives the right, to seek monetary damages of any kind (including but not limited to actual damages, economic damages, consequential damages, or lost profits) from the other Party in the event of a default under this MOU or any action related to this MOU. B. Choice of Forum. Choice of Laws. and Service of Process Any legal action under, pursuant to, or relating to this MOU must be instituted and maintained in the Superior Court of the County of Riverside, State of California, or in any other appropriate court in that county. The laws of the State of California shall govern the interpretation and enforcement of this MOU. ln the event that any legal action is commenced by KPC against City, service of process on City shall be made by personal service upon the City Manager of City or in such other manner as may be provided by law. ln the event that any legal action is commenced by City against KPC, service of process on KPC shall be made by personal service upon KPC or in such other manner as may be provided by law and shall be valid whether made within or without the State of California. C. Attorney's Fees. ln lhe event any action is taken by either party to this MOU to enforce this MOU, each Party shall bear their own fees and costs. D. lndemnity KPC shall indemnify, protect, defend and hold harmless City and City's elected officials, officers, employees, representatives, members, and agenls from and against any challenges to this MOU, or any and all losses, liabilities, damages, claims or costs (including attorneys' fees) arising from KPC's acts, errors, or omissions with respect to its activities and obligations hereunder, excluding any such losses arising from the sole negligence or sole willful misconduct of City. This indemnity obligation shall survive the termination of this MOU. City shall have sole discretion in selecting its defense counsel. I'agc 6 ol'9 E. Notices. Demands an d Communications Between the Parties. Formal notices, demands, and communications between City and KPC shall be given by any of the following methods: (i) personal service with a receipt obtained, (ii) delivery by reputable document delivery service such as Federal Express that provides a receipt showing date and time of delivery, or (iii) or by mailing in the United States mail, certified mail, postage prepaid, return receipt requested, addressed to: To City City of Menifee 29844 Haun Rd Menifee, CA 92586 Attn: City Manager With a copy to Rutan & Tucker, LLP 18575 Jamboree Road lrvine, CA 92612 Altn: City Attorney To KPC;KPC Global Medical Centers, lnc. 28400 McCall Blvd Menifee, CA 92585 Attn: Peter Baronoff, Chief Executive Officer Notices personally delivered or delivered by document delivery service shall be deemed effective upon receipt. Notices mailed in the manner provided above shall be deemed effective on the second business day following deposit in the United States mail. Such written notices, demands, and communications shall be sent in the same manner to such other addresses as either party may from time to time designate by formal notice given in accordance with this Paragraph E. F. Im;rlcmentation of IVIOU G.@41|[14ployces;NonlinbiIitvofI(l,(]0fficials Page 7 of9 City shalt maintain authority to implement this MOU through the City Manager (or his or her duly authorized representative). The City Manager shall have the authority to make approvals, waive provisions and/or enter into certain amendments of this MOU on behalf of City so long as such actions do not materially or substantlally change the substantive business terms of this MOU. Such amendments may include extensions of time to perform, provided the cumulative amount of such extensions shall not exceed six (6) months without City Council approval. All other material and/or substantive approvals, waivers, or amendments shall require lhe consideration, action, and written consent of the City Council. :rntl IlmDlovees. No member, official, employee, or contractor of City shall be personally liable to KPC in the event of any default or breach by City or for any amount which may become due to KPC or on any obligations under the terms of the MOU. No member, official, employee, or contractor of KPC shall be personally liable to City in the event of any default or breach by KPC or for any amount which may become due to City or on any obligations under the terms of the MOU. H. lnter tion The terms of this MOU shall be construed in accordance with the meaning of the language used and shall not be construed for or against either party by reason of the authorship of this MOU or any other rule of construction which might otherwise apply. The Section and Paragraph headings are for purposes of convenience only, and shall not be construed to limit or extend the meaning of this MOU. E ntire A reemen Waivers. and Amendments.t.(l This MOU integrates all of the terms and conditions mentioned herein, or incidental hereto, and supersedes all negotiations or previous agreements between the parties with respect to all or any part of the subject matter hereof, All waivers of the provisions of this MOU must be in writing and signed by the appropriate authorities of the party to be charged, and all amendments and modifications hereto must be in writing and signed by the appropriate authorities of City and KPC. Wthout limiting the foregoing, the parties understand thatthe results of this MOU may lead to future agreements orobligations which shall only become valid (if at all) upon full execution of such future agreements. J. Counterparts. This MOU may be executed in counterparts, each of which, after all the parties hereto have signed this MOU, shall be deemed to be an original, and such counterparts shall constitute one and the same instrument. K. Successors Subject to the limitations on Assignments above, this MOU shall be binding upon and shall inure to the benefit of the permitted successors of each of the parties hereto. L. Severabilitv. [Signatures contained on following page] Pagc 8 of9 I. ln the event any section or portion of this MOU shall be held, found, or determined to be unenforceable or invalid for any reason whatsoever, the remaining provisions shall remain in effect, and the parties hereto shall take further actions as may be reasonably necessary and available to them to effectuate the intent of the parties as to all provisions set forth in this MOU. lN WITNESS WHEREOF, City and KPC have executed this MOU on the respective dates set forth below. ("city") CITY OF MENIFEE, a California municipal corporation Dated T tt By: Armando G. Villa. City Manager ATTEST: M anwaflng,City erk APPROVED AS TO FORM: R AND TUCKER, LLP T. Me Attorney B ( KPC',) KPC GLO By: Peter Its: CEO tNc. ;)-Dated Pagc 9 of 9 0^-"P ru