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Inland Memorial / Hermosa Gardens Cemetery Update <br />June 16, 2009 City Council Meeting Page 2 <br />The City's efforts to complete the HCP have been delayed. Shortly after the purchase of the <br />Schafer Parcel and the initiation of the HCP efforts, City staff was contacted by representatives <br />from Inland Memorial expressing an interest to come and present plans to expand Hermosa <br />Cemetery. An initial meeting was held on August 28, 2007 where staff shared with the <br />representatives of Inland Memorial the Cooperative Conservation strategy and its impacts on their <br />ability to expand throughout the entire undeveloped 20 acres of cemetery property. City staff <br />indicated that they wanted to work with Inland Memorial to ensure their long-term financial <br />stability, but that it was going to be difficult for them to expand into the undeveloped 20 acres due <br />to the presence of "the fly." <br />Throughout the next seven months, a City Council subcommittee was formed, numerous <br />meetings with Inland Memorial occurred, and a variety of documents and assertions were <br />exchanged. On December 27, 2007, City Manager Parrish issued a "Notice of Material Violations <br />of Lease Agreement and Demand for Corrective Action". Included in this document were a <br />number of findings concerning the actions of Inland Memorial that violated the Lease Agreement <br />between the City and Inland Memorial. As a result of these actions, the entire City Council hosted <br />a meeting with Inland Memorial representatives on January 2, 2008. City Council directed the City <br />Attorney and staff to work with Inland Memorial representatives to arrive at a decision as to <br />whether to include Inland Memorial in the City's HCP efforts or to carve them out of those efforts. <br />After two meetings between the representatives of Inland Memorial and the City, it was staff's <br />recommendation that the only reliable alternative for the City was to pursue an HCP excluding the <br />undeveloped parcel adjacent to Hermosa Cemetery (i.e., carve out Inland Memorial from the HCP <br />development). The City Council endorsed this decision and approved the recommendation to <br />bifurcate the HCP process at the April 1, 2008 City Council meeting. <br />DISCUSSION/ANALYSIS: <br />On January 20th, 2009, staff provided City Council and the community with an overview <br />presentation that highlighted nine (9) outstanding issues of concern. By way of summary, the nine <br />issues involved: <br />1. Improper Quarterly Reporting <br />2. Failure to Pay Endowment Fund / Rent on Pre -Need Contracts <br />3. Failure to Make Utility Payments <br />4. Unapproved Substitution of Key Personnel <br />5. Lack of Insurance / Trust Fund to Cover Future Burials <br />6. Underfunded Endowment Care Fund <br />7. Failure to meet Performance Bond provision <br />8. Failure to advise city on DSF Progress <br />9. Improper attempts to access Hermosa Gardens Cemetery Trust Account <br />In recent weeks, City staff has met with representatives from Inland Memorial on two separate <br />occasions (May 20th and June 2"d) to ascertain what (if any) efforts were being taken to address <br />the outstanding issues identified in the Notice of Default (dated March 27, 2009). This dialog <br />continues with many of the issues unresolved. However, Inland Memorial has brought the utility <br />bills current and has implemented a reorganization to address issues with the management at the <br />Cemetery. <br />2 <br />