Loading...
HomeMy WebLinkAboutrda min 1988/08/23 MINUTES OF AN ADJOURNED REGULAR MEETING OF THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA, CALIFORNIA Tuesday, August 23, 1988 5:40 p.m. ROLL CALL: Council Conference Room Ci ty Hall MEMBERS PRESENT: MEMBERS ABSENT: STAFF PRESENT: Chairman Cox, Members Nader, Moore and McCandliss Member Malcolm Executi ve Di rector Goss, Communi ty Development Director Desrochers, Assistant City Attorney Rudolf 1. a) RESOLUTION 951 APPROVING AND AUTHORIZING THE EXECUTION OF THE EXCLUSIVE NEGOTIATION AGREEMENT BETWEEN THE REDEVELOPMENT AGENCY AND CHULA VISTA INVESTMENTS b) RESOLUTION 952 APPROVING AND AUTHORIZING THE EXECUTION OF THE LOAN AND OPTION AGREEMENT BETWEEN THE REDEVELOPMENT AGENCY AND CHULA VISTA INVESTMENTS AND APPROVING THE FORM OF PROMISSORY NOTES AND DEEDS OF TRUST Executi ve Director Goss noted thi s item was conti nued from the meeti ng of August 18, 1988 in which certain documents were given to the Agency members regarding these two resolutions. Mr. Goss stated the attorneys will go through the documents received by the Agency in order to indicate minor corrections that have been made since the meeting of August 18. Mr. Goss also noted a 1 etter dated August 22 from Rohr had been received. The 1 etter indicates Rohr's interest in buying +10 acres of this property. It is Mr. Goss' understanding there will be a response to that letter from CVI. Ms. Marcia Scully, special counsel to the Agency, discussed the Exclusive Negotiation Agreement. She stated there was only one change since the August 18 meeting. The change was a deletion in §105 of the agreement, deleting reference to a pre 1 imi nary time schedul e that was goi ng to be attached as Exhibit C. Instead, a time schedule is to be approved mutually by the parties within thirty days. Respondi ng to Member McCandl i ss' questi ons, t~s. Scully stated the Agency has not committed to subordination in this agreement. §700 of this agreement i ndi cates that by enteri ng into thi s agreement, the Agency has not approved anything which requires any subsequent acts on the Agency. Mr. Stephen Delany of TopMark, consultants to the Agency, stated the current Note and Deed of Trust have no reference whatsoever to subordi nati on. The only reference to subordination is where Mr. Barkett has requested the Agency consider subordination during further negotiations. - MINUTES -2- August 23, 1988 Responding to questions raised by Chairman Cox, Ms. Scully stated the definition of the site does not include the Rohr parcels. Member McCandl i ss referred to §l 04, paragraph 8, where it states "Developer has proposed the following terms for consideration relative to subordination". She suggested changing that sentence to read "Developer has proposed the following terms for Agency consideration relative to subordination". Mr. Tom May, attorney for the developer, discussed the Loan and Option Agreement. A copy of the agreement marked to show changes was given to each Agency member. Mr. May pointed out the substantive changes to the agreement. Regarding Section 3.6, Exercise of Option, Mr. May explained Mitigation Credi ts may be purchased in amounts not 1 ess than ten acres, and the ten or more acres shall be conti guous wi th one another to the extent practi cab 1 e. CVI did not want to be left with holdings with mitigation credits that are chopped up in small, unusable chunks. Further language added to this section, was intended to accomplish a "shifting" option. If after initially designating 40 acres for the option, the Agency wishes to change its mind, it may do so. As to the ri ght of fi rst refusal credits, the Agency access to those credits are subject to two conditions. (1) The developer's use of those credits for its own projects. (2) The potential for prior sale to third parties that would trigger the Agency's right of first refusal. In reference to the use of mitigation credits for the developer's own projects, Member Nader asked if this refers to developer's projects at any place, or developer's projects on the Bayfront? Mr. May stated it refers to developer's projects without limitation as to location. This point was discussed during the negotiations. Member Nader suggested South Bay projects have pri ority. Member Nader asked if the Agency staff is confident that the Agency will not need more than forty acres for projects significant in Chula Vista. Mr. Desrochers stated it is not known at this time what mitigation credits may be needed in the future. Mr. Nader asked if there is a significant possibility that more than forty acres will be needed? Mr. Desrochers stated yes. In this event, Mr. Nader stated the priority should be to make sure the credits are available for South Bay projects. Mr. May stated the way to assure this is through an Owner Participation Agreement (OPA). This transaction was structured in order to create incentive to complete the OPA. Mr. May pointed out the Agency has the loan subject to a 120 day call provision; the Agency has firm access to 40 mitigation credits; the Agency has right of first refusal to the balance of the mitigation credits; and the Agency has an OPA process in the future which gives strong possibilities of getting further access to more mitigation credits. Responding to concerns addressed by Mr. Nader, Mr. Barkett pointed out if CVI should decide to sell mitigation credits to a third party, CVI is obligated to offer the mitigation credits to the Agency at the same price. MINUTES -3- August 23, 7988 Mr. May further pointed out a new section was added to this document, 4.10 Rohr Negotiations. This is CVI's contractual commitment to the Agency with respect to negotlations with Rohr. Mr. May next discussed the Acquisition Note (Promissory Note Secured by Deed of Trust). Referri ng to Secti on 1 C., the sentence begi nni ng wi th (i i i) was deleted. This sentence referred to the discontinuing of the call provision upon the cl osi ng of any sale of mi ti gati on credits pursuant to the Agency's exercise of the option. This was the only change to this document. Mr. May reported there were no other changes to the balance of the documents. Mr. Art Sellgren representing Rohr Industries addressed the Agency with regard to the status of their negotiations with CVI. Rohr is appreciative of the protecti on the Agency has embodi ed in the documents before the Agency for approval. Rohr has given to Mr. Barkett two documents: (1) proposal for agreement, and (2) letter of agreement. Rohr does want to continue negotiating. The management of Rohr wanted to have a basic agreement in place prior to the closing of escrow which is why the short form letter of agreement was given to Mr. Barkett. That particular letter of agreement has six points that are important to Rohr. (1) Understanding that Rohr is being required to acquire more than the 11.6 acres they desired. The total parcel is 16.4 acres (including the Park). (2) Rohr wanted to maintain a purchase price of $3,250,000. (3) Rohr wanted to assume the same representations, warranties and indemnification that Santa Fe will pass on to Mr. Barkett. (4) Rohr realizes that after closing it will be necessary to go through the subdivision process. At that time, Rohr woul d deed the park parcel back to Mr. Barkett. They wanted indemnification from all costs and liabilities arising from Rohr's temporary ownership of the Park. (5) Rohr is willing to pick up the development costs on the parcel. (6) Rohr is interested in being able to utilize the 404 permit that will be assigned to Mr. Barkett. Mr. Sellgren further noted a meeting has been scheduled for August 31 with Mr. Barkett and that negotiations will continue. Mr. Desrochers stated it is recommended that the Agency approve these documents. He noted the Loan and Option Agreement will have an attachment, and a Letter of Credit, and he suggested these be left up to the discretion of the Agency's legal counsel. Assistant City Attorney Rudolf noted the only change that has been made at this meeting is the addition of the word Agency on page 4, paragraph 8, in the sixth line following the word "for" in the Exclusive Negotiation Agreement. Mr. Rudolf al so noted the final document will correct the error of repeating section D [§ 104]; changing the second section D [§ 104] to read section E [§ 105] and the current section E [§ 105] will become section F [§ 106]. MSUC (Cox/McCandliss) that the corrections explained by Assistant City Attorney Rudolf be reflected in the resolution. MINUTES -4- August 23, 1988 of the text was waived of the text was waived RESOLUTION A WAS OFFERED BY CHAIRMAN COX, the reading by unanimous consent, passed and approved unanimously. RESOLUTION B WAS OFFERED BY CHAIRMAN COX, the reading by unanimous consent. Member Moore asked the Executive Director if he had spoken with Member Malcolm and if hi s concerns had been addressed. Mr. Goss reported he spoke wi th Member Mal col m and the concerns he expressed to Mr. Goss are addressed and reflected in these documents. The resolution passed and was approved unanimously. 2. ORAL COMMUNICATIONS: None 3. DIRECTOR'S REPORT: None 4. CHAIRMAN'S REPORT: None MEMBERS' COMMENTS Member McCandl i ss stated there was a 1 etter from the former 1 andowner of the bayfront property (CVIC) in the Council packet regarding dumping on the bayfront. She stated she would like to see this letter addressed. ADJOURNMENT at 7:00 p.m. to the regular meeting of September 1, 1988 at 7:00 p.m. ~~Æ- Community Development Director WPC 3743H AGENDA AN ADJOURNED REGULAR MEETING OF THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA, CALIFORNIA Tuesday, August 23, 19S5 5:30 p.m. ROLL CALL Council Conference Room City Hall 1. a) RESOLUTION Approving and authorizing the execution of the Exclusive Negotiation Agreement between the Redevelopment Agency and Chula Vista Investments b) RESOLUTION Approving and Authorizing the Execution of the Loan and Option Agreement between the Redevelopment Agency and Chula Vista Investments and approving the form of Promissory Notes and Deeds of Trust 2. ORAL COMMUNICATIONS 3. DIRECTOR'S REPORT 4. CHAIRMAN'S REPORT 5. MEMBERS' COMMENTS ADJOURNMENT to the regular meeting of September 1, 1988 at 7:00 p.m.