There are serious concerns with the agreement that the Park Board expects CCAs to sign by September 30, 2017. One of the issues is the ability of the Park Board to terminate the Joint Operating Agreement.
We want to explain about each concern and show why CCAs are asking Park Board Commissioners to have the Park Board lawyer and CCA lawyer review the agreement.
Please read this series of blog posts on each of the six key concerns.
CONCERN 2: ABILITY OF THE PARK BOARD TO TERMINATE THE JOA
Original CCA Concern: In section 21.1, the 90-day notice period and 60-day cure period are too short to allow for a proper remedy of a material breach by a CCA. Furthermore, the proposed JOA allows the Park Board to unilaterally determine whether a CCA is “continually and diligently” working to resolve the breach and if its determination is negative it may terminate the agreement with no further notice during the period allowed the CCA to repair the breach. This is arbitrary and unfair. The language in this section is harsh and overreaching.
Park Board Response: The new JOA includes a number of additional protections, including notification of breaches and a cure period. This is a substantial change from the current JOAs, which allow the parties to terminate the JOA for any reason on 3 months’ notice with no cure periods. If a CCA were to disagree that there has been a breach they would have access to dispute resolution under the new JOA. Access to dispute resolution is another significant protection that is not included in the current JOAs.
CCA Response to Park Board: While it is true the current JOA has a 3-month termination clause, CCAs are protected by potential license to occupy, which is yet to be heard by the courts. If we sign the proposed JOA, we are foregoing this protection. Thus, we are seeking greater stability in the proposed JOA in exchange for what we are giving up. We not asking for elimination of the clauses, but that they be modified to make them more reasonable.