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HomeMy WebLinkAboutrda min 1978/09/07 MINUTES OF A REGULAR MEETING OF THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA Thursday - 7:00 p.m. September 7, 1978 A regular meeting of the Redevelopment Agency of the City of Chula Vista was held on the above date beginning at 7:00 p.m. in the Council Chambers of City Hall, 276 Fourth Avenue, Chula Vista, California with the following: MEMBERS PRESENT Chairman Hyde; Members Cox, Gillow, Scott Members Absent Member Egdahl STAFF PRESENT Executive Director Cole, Special 'Counsel Reed, Community Development Director Desrochers, Community Development Coordinator Boyd, Administrative Analyst Sanseverino, Assistant Planner Welch ALSO PRESENT Robert Pierre, Joe Street, Jr. ITEM NO. 1 - APPROVAL OF MINUTES It was moved by Member Scott, seconded by Chairman Hyde and unanimously carried by those present to approve the minutes of August 3, 15, and 22, 1978 as mailed. ITEM NO. 2 - REPORT: ORANGE DEVELOPMENT & INVESTMENT COMPANY An Exclusive Negotiation Agreement with Orange Development & Investment Company was signed by the Redevelopment Agency on May 16, 1978. Phase I of the agreement called for the acquisition of four parcels by the Agency. Three parcels have been purchased and the fourth parcel is before the Agency tonight for condemnation. It is hoped that the Agency and developer may proceed with Phase II of the agreement which, on the part of the Agency, includes: processing of all materials (users/concepts, etc.) submitted by the developer; assisting the developer in the processing for approval of the developer's EIR and Coastal Commission application; and entering into an agreement for engineering services for the design of off-site improvements. During the second phase, the developer agrees to: the submission of a plot plan to th e Agency; preparation of an EIR and application for a permit from the San Diego Regional Coast Commission; presentation to the Agency of a financing plan demonstrating the financial feasibility of the project and willingness of identified investors and lenders to actually finance the project; and preparation and submission of plans to th e Agency. Community Development Director Desrochers reported that he has spoken to representa- tives of the Orange Development & Investment Company regarding the project's progress. This is the first instance that we have used redevelopment funds to actually acquire the property. In other instances, Block Grant funds were used. Although the develop- ers have several tenants, they do not have their key user. Mr. Desrochers indicated that if the company has not firmed up all of their leases by the October Agency meeting, we should impose a "Goodwill" deposit upon them. The director reminded Agency members that it has been three months since the Exclusive Negotiation Agreement was approved and that agreement provides the City the opportunity to rescind it if they haven't performed certain duties within a specified time. 9/7/78 -2- Redevelopment Agency Meeting September 7, 1978 In response to Special Counsel Reed's comments to delay action on the resolution under Item No.6, Community Development Director Desrochers stated that it is incumbent that the Agency proceed with the resol ution as proposed. It was moved by Chairman Hyde, seconded by Member Scott and unanimously carried by those present to accept the report. ITEM NO. 3 - RESOLUTION - REQUESTING U.S. MAGISTRATE TO ASSIST IN EXPEDITING DEVELOPMENT PROPOSAL REVIEW The conceptual plans for Ramada Inn have been completed; the soils test and topographic study are in preparation. Bay Boulevard Corporation has deposited a franchise fee and expended a great amount of funds relative to the development of the complex. Now, due to the inability of the Federal Receiver to approve the conceptual plans, all pro- gress must be stopped. It is the opinion of the Federal Receiver that their portion of the property does not provi de for the hi ghest and best use. As stated in the agree- ment between the Receiver and the Streets, when matters cannot be resolved between the two parties, then a third party arbitrator shall settle the matter. Staff feels that the City has a direct interest in the problem in that the momentum already established for the redevelopment of Bay Boulevard will be greatly affected by this delay. On August 30, 1978, a letter addressed to the Federal Receiver, R. N. Gould, was sent by the Community Development Director. This letter explained the importance of Mr. Gould's understanding of the total development and urged the Receiver to meet with the corporation's representativ~ Mr. Pierre, to resolve the issue as quickly as possible. Community Development Di rector Desrochers informed the Agency that he had contacted Mr. Gould on Wednesday, August 30 and asked if he would not consider talking with representatives of the Bay Boulevard Corporation. That meeting has taken place; therefore, the di rector recommended the resol uti on be fi led. It was moved by Chairman Hyde, seconded by Member Cox and unanimously carried by those present to file the resolution. Robert E. Pierre, representing Bay Boulevard Corporation, along with Joe Street, Jr., displayed a colored rendering of the Ramada Inn that depicted the main entrance to the motel, the 13,000 square foot restaurant, banquet facilities, cocktail lounge and kitchen. Mr. Desrochers explained that the draft Owner Participation Agreement (in conjunction with this project) will be presented to the Agency at their October 5 meeting. The agreement was held up when the aforementioned problems were encountered. Mr. Des rochers informed members that design review by the Planning Commission along with the EIR will also be required prior to Agency acceptance of the design. ITEM NO.4 - RESOLUTION NO. 135 - APPROVING AN AGREEMENT BETWEEN THE AGENCY, BAY BOULEVARD CORPORATION, ORANGE DEVELOPMENT & INVESTMENT COMPANY AND WESTEC SERVICES, INC. FOR THE PREPARATION OF DRAFT AND FINAL EIR'S AND APPROPRIATION OF FUNDS With progress of the projects being developed by Joe Street (Bay Boulevard Corporation) and the Orange Development & Investment Company proceeding, it appears that plans for 9/7/78 -3- Redevelopment Agency Meeting September 7, 1978 both projects can be submitted by the end of the calendar year. In order to take action, the Redevelopment Agency must first consider the environmental impact of the projects. An RFP for the preparation of one EIR for both projects is recommended by staff in order to save time and money. The RFP has been distributed to five consult- ing firms in the San Diego area. The firm submitting the lowest fee is WESTEC Services, Inc. at $9,236. Therefore, staff recommends the Redevelopment Agency contract with WESTEC to prepare the EIR. Chairman Hyde questioned the legality of combining the EIR's. Community Development Director Desrochers indicated there is no legal problem. Offered by Member Cox, the reading of the text was waived by unanimous consent of those present, passed and adopted by the following vote, to-wit: AYES: Member Cox, Hyde, Gillow, Scott Noes: None Absent: Member Egdahl ITEM NO. 5 - REPORT: BAY FRONT FREEWAY SIGNING With the assurance of Bay Boulevard development, staff now sees the need to consider the identification of this visitor/commercial area. The Bayfront Plan calls for one freeway-related sign in each direction; the Coastal Commission concurred with the Bayfront Plan stipulation in their review of Anthony's sign. Realizing that the task of designing an aesthetically pleasing sign structure is not simple, staff has taken the liberty of requesting proposals from area architects. After design and approval, actual construction will be accomplished by the Redevelopment Agency. It was moved by Chairman Hyde, seconded by Member Cox and unanimously carried by those present to accept the report. ITEM NO. 6 - RESOLUTION NO. 136 - a. DETERMINING AND DECLARING THE PUBLIC NECESSITY OF THE ACQUISITION OF PROPERTY OWNED BY EMMET AND MERLE KAUL b. AUTHORIZING THE EXPENDITURE OF $1,000 FOR GOODWILL APPRAISAL At a special meeting of the Redevelopment Agency on May 16, 1978, the authorization of the purchase of five parcels of land along Bay Boulevard was made. Three of the five parcels have been acquired to date. The parcel owned by Emmet Kaul (South Bay Auto Wreckers) has yet to be purchased and, due to this fact, could hold up redevel- opment of the site. Settlement of the land and improvement value is foreseen but there seems to be a problem concerning the goodwill or value of business at the particular location. The principles involved, Emmet and Merle Kaul, were informed of tonight's public hearing and were duly notified of their right under California law to appear at the hearing. As was stated in the notice urging the Kaul's to file a written request to speak on the issues, a letter dated August 28, 1978 from Jon P. Chester, esq. (re- presenting Mr. & Mrs. Kaul), addressed to the Executive Secretary of the Redevelopment Agency was received. Mr. Desrochers proceeded to read this letter into evidence. 9/7/78 -4- Redevelopment Agency Meeting September 7. 1978 There being no pumlic testimony, the public hearing was declared closed. In response to Chairman Hyde's question regarding settlement of the monetary value for goodwill, Community Development Director Desrochers remarked that this is the problem hindering settlement. Staff has discussed this with the Kaul's and their attorney and our calculations from their figures was too low for consideration on their part. Our appraiser (Lee C. Johnson) stated that he would certify the calcu- I ations; staff felt, though, that this should be done by means of a more formal presentation. Special Counsel Reed clarified that in most appraisal situations where owner occupancy is involved, a goodwill appraisal is required. He noted that Mr. Desrochers' obser- vation is correct with respect to negotiated land rights. There is great discrepancy though between the Agency's offer and the owner's demand which puts it clearly into condemnation context. Procedurally, the City is at the point of starting condemnation proceedings, obtaining the goodwill appraisal so as to structure further negotiations; or, if necessary, initiate condemnation proceedings and let the court decide. Offered by Member Scott, the reading of the text was waived by unanimous consent of those present, passed and adopted by the following vote, to-wit: AYES: Member Scott, Cox, Hyde, Gillow Noes: None Absent: Member Egdah I Member Cox questioned staff as to whether Item 6(b) required a separate resolution for authorization of the expenditure. Special Counsel Reed, in answer to this question, remarked that an additional resolution was not required since the City has a master contract with the Lee C. Johnson, Co. that provi des for any additi ons to it. In lieu of a separate resolution, Mr. Reed noted that a minute action would suffice. Director Desrochers commented that funds are available in the Bayfront account. It was moved by Member Cox, seconded by Chairman Hyde and unanimously carried by those present to authorize the expenditure of $1,000 for a goodwill appraisal. ITEM NO. 7 - RESOLUTION NO. 137 - DETERMINING AND DECLARING THE PUBLIC NECESSITY OF THE ACQUISITION OF PROPERTY OWNED BY FRANK E. FERREIRA The 2.11 + acre parcel in question is key to the Zogob condominium development. In order to avoid litigation, attempts will be made in accordance with the Agency's established policy. Authority to purchase and to utilize eminent domain is requested in order to facilitate the acquisition As required by California law, an attempt was made to notify Mr. Ferreira by mail of his right to appear before the Agency at tonight's public hearing. Special Counsel Reed informed the Agency that he had finally contacted Mr. Ferrei ra on Wednesday, August 30, apprising him of his right to speak and providing him with a notice of these proceedi ngs. There being no further comments by staff or the Agency, and this being the time and place as noticed, the public hearing was declared open. 9/7/78 -5- Redevelopment Agency Meeting September 7, 1978 There being no public testimony, the public hearing was declared closed. Offered by Chairman Hyde, the reading of the text was waived by unanimous consent of those present, passed and adopted by the following vote, to-wit: AYES: Member Hyde, Gillow, Scott, Cox Noes: None Absent: Member Egdahl ITEM NO. 8 - REPORT: ZOGOB DISPOSITION & DEVELOPMENT AGREEMENT No financial commitments have been received although negotiations between Mr. Zogob and staff have been completed. A commitment is expected from either Bank of America or Stone & Youngberg/Merri 11 Lynch Hubbard, Inc. A draft of a I etter to be sent (upon Agency concurrence) to Bank of America has been made available for Agency review. In v;,ew of the recent tax increment situation involving Proposition 13, the whole spectrum of redevelopment financing has changed. If the bank can present a better arrangement than our consultant, Stone & Youngberg, our relationship with them will be ended. In order to qualify for UDAG, a commitment must be made in the first half of September. Stone & Youngberg informs us that their position will be known by September 12th. Bank of Ameri cia has al so been noti fi ed of the timi ng requi rement. Member Scott requested clarification from the special counsel regarding his eligi- bility to vote on this item since the firm he is currently employed with is a sub- sidiary of Merrill Lynch Hubbard, Inc. Mr. Reed informed Member Scott that according to a letter he sent to the City Attorney in this regard, there does not seem to be a conflict of interest and that in the event something should arise in which there would be a conflict, he would be notified. Full discussion ensued with regard to soliciting a financial institution that will provide a letter of credit of up to $2'2 million and that said amount has been de- termi ned wi thout Agency acti on. Special Counsel Reed clarified that the draft letter to Bank of America is a response to their representatives signifying that if they can assemble a financing package acceptable to Ufe Agency and the developer, the Agency would execute the letter of understanding relative to the Disposition & Development Agreement. Mr. Reed continued that the Agency is not committing any money or write down figures, but rather trying to pull together a package that implements the Disposition & Development Agreement. The special counsel commented that this item is deserving of a workshop session in order to explain the entire package to the members. It was moved by Member Cox, seconded by Chai rman Hyde and unanimously carried by those present to accept the report. It was moved by Member Scott, seconded by Chairman Hyde and unanimously carried by those present to schedule a workshop for Saturday, September 23, 1978 at 8:00 a.m. in the Council Conference Room to discuss the Disposition & Development Agreement develop- ment. 9/7 /78 -6- Redevelopment Agency Meeting September 7, 1978 ITEM NO. 9 - REPORT: a. PARKING - THIRD AVENUE REDEVELOPMENT AREA b. CONSTRUCTION SCHEDULE FOR THIRD AVENUE STREET IMPROVEMENTS PARKING - THIRD AVENUE REDEVELOPMENT AREA Parking in Subarea 1 of the Town Centre Redevelopment Area has been a problem for several years. The City Council and Redevelopment Agency have been considering solutions to the problems and have recently come up with several determinations in- cluding: evaluation and implementation of an in-lieu fee for new construction and remodeling in Subarea 1; parking district expansion and bond sale; cancelling the purchase of two parcels on Church Avenue; preparation of a long-range plan for parking in Subarea 1 and a program for its implementation. The long-range plan is being developed withlinput from the Project Area Committee, Parking Place Commission, Chamber of Commerce and Town Centre Business & Professional Association gathered for formal presentation to the Agency and Council at a later date. CONSTRUCTION SCHEDULE The Agency at its August 3rd meeting, directed staff to prepare a report that would outline the manner in which street improvements would be considered on Third Avenue. Due to the possibility of hardships caused by the length of construction, this project is considered highly sensitive. Realizing these hardships, staff has requested the Small Business Administration to investigate the eligibility of this area for any type of federally assisted loans to help these businesses throughout the hardship period. Due to the extensive delays already experienced by this project, it is important that groundbreaking proceed at the beginning of the year. With Agency concurrence, should a delay beyond January be foreseen, staff recommends the delay be no longer than six to eight weeks or a project start date of February IS, 1979. It was moved by Member Cox, seconded by Chairman Hyde and unanimously carried by those present to accept the report. ITEM NO. 10 - REPORT: TOWN CENTRE PROJECT #II STATUS The possibility of expansion and redevelopment of the Chula Vista shopping center has been discussed with representatives of Carter Hawley Hale Properties, Inc. and Gruen Gruen + Associates. Preparation of a financial feasibility report has begun so as to determine the extent of both developer and Agency participation. It is anticipated that a financing commitment will be required within the near future. Once the feasi- bility analysis has been completed, the next step will be to consider negotiating an agreement with the firm. Upon Agency direction, and pending resolution of the situ- ation between the developer and the Agency, the Public Works staff will make plans for a temporary closure of Fifth Avenue. Chairman Hyde commented that he was impressed with the degree of cooperativeness dis- played by Mr. Joe Ochoa, manager of Sears and a member of the Town Centre Project Area Committee, with regard to the Fifth Avenue street closure. The Chairman noted that at the meeting of the Project Area Committee this morning, Member Ochoa expressed concern due to the impact the closure would have on Sears' TBA store. 9/7/78 -7- Redevelopment Agency Meeting September 7, 1978 It was moved by Member Cox, seconded by Chairman Hyde and unanimously carried by those present to accept the report. MEMBERS' COMMENTS Member Gillow noted that due to business commitments, he was unable to attend the Town Centre tour but will be accompanying the Environmental Control Commission on a s imil ar tour. DIRECTOR'S COMMENTS Executive Director Cole pointed out that every two years a hearing involving redevelop- ment districts is required by law. One such hearing is scheduled for the Agency meeting in October along with the public hearing on the Local Coastal Program. Chairman Hyde requested permission to be absent from the Redevelopment Agency meeting on October 5 as he will be on vacation. It was moved by Member Cox, seconded by Member Scott and unanimously carried by those present to approve the Chai rman' s request. Further discussion ensued with regard to holding a special Redevelopment Agency meeting for Disposition & Development Agreement discussion purposes. It was moved by Chairman Hyde, seconded by Member Scott and unanimously carried by those present to schedule a special meeting of the Redevelopment Agency on September 26, along with the regularly scheduled City Council meeting. ADJOURNMENT . The meeting was adjourned at 7:47 p.m. to the Redevelopment Agency workshop scheduled for Saturday, September 23, 1978. J , // " >.-, , ,,- ~..:'i- /. " .. -'?::,'.. t,- c;//f'- .. i",l. PaúféG:'ße;rocher~, Secretary 917178