To: Sonoma County Board of Supervisors
Department or Agency Name(s): County Clerk-Recorder-Assessor
Staff Name and Phone Number: Amanda S. King, 707-565-1805
Vote Requirement: Majority
Supervisorial District(s): Countywide
Title:
Title
Award of Restrictive Covenant Modification Program Services Agreement
End
Recommended Action:
Recommended action
Award and authorize the County Recorder to execute a five-year professional services agreement with Extract Systems, LLC, in an amount not to exceed $500,000 with the term ending January 31, 2028, to provide services in connection with the County Recorder’s Restrictive Covenant Modification Program, and delegate authority for the County Recorder to execute minor amendments to the agreement, in a form approved by County Counsel, not to exceed $50,000.
end
Executive Summary:
The County Recorder conducted a Request for Proposals seeking a contractor to assist with the identification, redaction and re-recordation of documents that contain unlawful restrictive covenant language in connection with the County’s Restrictive Covenant Modification Program required by Assembly Bill 1466. These restrictions are often racial in nature and have existed in property records since the early 1900s. The award of this agreement will allow the County Recorder to commence its Restrictive Covenant Modification Program and start to provide data related to restrictive covenants for public information.
Discussion:
A Restrictive Covenant is a recorded restriction on the use of property. In the early part of the 20th century, it was common for restrictive covenants on properties to prevent people of color from purchasing, renting, or using property (unless as a servant). It was especially common in the 1930s and 1940s to see this type of language on recorded deeds and other real property documents.
Restrictive covenants that discriminate based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Government Code Section 12955, ancestry, or age (not including lawful restrictions on the age of occupants in senior housing or housing for older persons) are illegal and void under existing federal and state law. However, these restrictions may still exist in the record itself as it was presented and recorded at that time in the past. Most property owners would only see this document when they are asked to sign a disclosure as part of the escrow process, pledging to ignore any unlawful covenant.
Prior to 2022, Government Code Section 12956.2(a) provided that any person who holds an ownership interest in property that believes the recorded documents for the property contain any unlawfully restrictive covenants in violation of Government Code section 12955(l) may submit for recordation a Restrictive Covenant Modification (RCM) document. If the existence of unlawfully restrictive language is confirmed by County Counsel, the modification document is recorded with the unlawful restrictive covenant stricken. However, most property owners are not aware that these covenants exist and very few, eligible, property owners have completed this process.
In 2021, Assembly Bill 1466 (AB 1466) was enacted by the State Legislature and made changes to the RCM process. The new law imposes a state-mandated local program and opens the ability to all, including the County Recorder, to submit an RCM document for recording and redact the illegal restrictive language. As part of the new processes, Government Code Section 12956.3 requires the Sonoma County Clerk-Recorder’s Office to create a program to:
• Search for and identify unlawful restrictive covenants;
• Redact unlawful restrictive covenants through a recorded RCM;
• Track identified unlawful restrictive covenants;
• Make an index of recorded RCM documents available to the public;
• Maintain the original non-redacted recordings;
• Provide status reports to the County Recorders Association of California.
In spring 2023, the County Recorder conducted a Request for Proposals (RFP) process to identify and screen qualified vendors for Restrictive Covenant Modification Program Services. The County Recorder solicited proposals for automation of the entire process. The scope includes identification of wording through text searching on previously recorded documents to identify illegal restrictive language, preparation of Restrictive Covenant Modification (“RCM”) documents with the required cover page, redaction of the illegal language, submission to County Counsel for review and approval, application of electronic signatures, and submission to the County Recorder for electronic recording. The vendor’s system must also provide the capability to electronically integrate with the County Recorder’s recording software, Tyler Technologies Records Management (“Tyler”). The successful vendor must design, install, and implement the system while also providing comprehensive system training, operation and maintenance.
The RFP was sent to 392 suppliers and advertised on the County Recorder’s Restrictive Covenant Modification Program Implementation Plan website. Seven vendors submitted responsive proposals for this RFP. The selection process for awarding the contract was conducted by an internal team from the County Recorder and one outside employee from another department. Using comprehensive weighted criteria the vendors were ranked and the top three highest ranking vendors were chosen for an in-person demonstration of their system. Proposals were evaluated based on cost of services, demonstrated ability to meet the defined system functionality requirement, responsiveness of written proposals submitted, quality of work as verified by references, and locality of the proposer. The top-three highest ranking vendors were additionally ranked on their demonstration. After thorough review of all proposals received it was determined by the panel that Extract Systems, LLC was the highest ranking proposer.
The Recorder recommends award of a professional services agreement to Extract Systems, LLC, with a term commencing October 17, 2023 and expiring January 31, 2028, to provide services in connection with the Restrictive Covenant Modification Program in an amount not-to-exceed $500,000. The Recorder also requests a delegation of authority to make minor amendments to the agreement to address new issues that may arise, changes in law, and other changed circumstances. Any amendment will be approved as to form by County Counsel and amendments will not exceed a combined amount of $50,000 above the approved not-to-exceed value of the awarded contract.
The work that will be done on this project, in collaboration with Extract Systems, will provide data about racially restrictive covenants and policies. This data will be available in the future for research related to the extent and impact of racially restrictive covenants. The Recorder’s Office intends to take future steps to provide this data in a geospatial format, although that is outside the scope of this contract.
Strategic Plan:
N/A
Racial Equity:
Was this item identified as an opportunity to apply the Racial Equity Toolkit?
No
This project will serve as a tool for seeing into the past and the historical inequity and restrictions that existed. The outcome of this project will be that there will be data available for individuals and organizations to use for future equity work and research.
Prior Board Actions:
4/5/2022 - Consolidated Fee Hearing to pass $2 recording fee for Restrictive Covenant Modification program.
Fiscal Summary
|
Expenditures |
FY23-24 Adopted |
FY24-25 Projected |
FY25-26 Projected |
|
Budgeted Expenses |
$397,069 |
$25,733 |
$25,733 |
|
Additional Appropriation Requested |
|
|
|
|
Total Expenditures |
$397,069 |
$25,733 |
$25,733 |
|
Funding Sources |
|
|
|
|
General Fund/WA GF |
|
|
|
|
State/Federal |
|
|
|
|
Fees/Other |
$397,069 |
$25,733 |
$25,733 |
|
Use of Fund Balance |
|
|
|
|
Contingencies |
|
|
|
|
Total Sources |
$397,069 |
$25,733 |
$25,733 |
Narrative Explanation of Fiscal Impacts:
On 4/5/22 the Board of Supervisors adopted a new $2 fee to cover the cost of the state mandated Restrictive Covenant Program, which was effective 7/1/2022. Given that sufficient fee revenues have not been collected to date to cover the full cost of the program, the department proposes to utilize available Recorder Modernization funds to cover program costs and the Restrictive Covenant Fee Fund will reimburse Modernization funds as funding is collected, in order to complete the project in a timely manner.
|
Staffing Impacts: None |
|
|
|
|
Position Title (Payroll Classification) |
Monthly Salary Range (A-I Step) |
Additions (Number) |
Deletions (Number) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Narrative Explanation of Staffing Impacts (If Required):
None
Attachments:
1. Restrictive Covenant Modification Program Services Professional Services Agreement
2. Exhibit A - Scope of Work and Schedule of Contract
3. Exhibit B - Cost of Services for Contract
4. Exhibit C - Insurance Requirements
Related Items “On File” with the Clerk of the Board:
None