HomeMy WebLinkAboutrda min 1986/10/02
MINUTES OF A REGULAR MEETING OF THE REDEVELOPMENT AGENCY
OF THE CITY OF CHULA VISTA, CALIFORNIA
October 2, 1986 Council Chambers
7:00 p.m. Public Services Building
ROLL CALL
Present: Chairman Cox; Members Moore, Malcolm, McCand1iss and
Campbe 11
Staff Present: Executive Director Goss, Community Development
Di rector Desrochers, Agency Attorney Harron,
Redevelopment Coordi nator Kassman, Seni or Community
Development Specialist Buchan
ITEM ~O. 1: APPROVAL OF MINUTES OF 9/4/86
MSUC (Moore/Campbell) to approve the minutes of 9/4/86.
ITEM NO.2: REPORT: STATUS OF PAUL THORYK'S DEVELOPMENT AT BAY BOULEVARD AND
"F" STREET
Community Development Director Desrochers introduced Paul Thoryk who was
present to discuss the status of his development at Bay Blvd. and "F" Street.
Mr. Thoryk stated he has a tenant for the si te. I t has been di ffi cult to fi nd
a tenant because development of the Bayfront across the street has not
occurred. The tenant is the Soup Exchange and he is in the process of final
negotiations of the lease and financing.
Member McCand1iss stated she is familiar with the Soup Exchange and it is not
the concept she was looking for at this site. She is looking for a high
quality restaurant such as the Velvet Turtle. Mr. Thoryk responded the
operators of the qual ity restaurants being referred to need more time; they
are concerned about the 1 ack of development of the Bayfront and that the
timing may not be right. However, the Soup Exchange is ready to build now.
Mr. Thoryk feels the Soup Exchange will be a unique and exciting addition.
Member McCand1 i ss cOlTIßented if the desi red hi gh qual i ty operator is
interested, but there is a question of timing, it might be more appropriate to
take the property back and hold it until such time when this type of operator
is prepared to come in.
Member Malcolm stated perhaps the Agency is forcing development into an area
that is probably not ready for a hi gh qual ity restaurant. He asked what the
process would be, as well as the financial loss to Mr. Thoryk, if the Agency
voted to have the property revert back to the Agency. Mr. Desrochers
responded the Di sposi ti on and Development Agreement states after 3 months
notice the Agency has the right to repurchase the property at the price that
was paid for it. There are some allowable costs that can be added.
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Redevelopment Agency Minutes -2- October 2, 1986
Member Malcolm stated he would like to see this item continued for two weeks.
He is willing to view the Soup Exchange to see if it is the quality the Agency
is looking for.
Memb~r Moore stated he would not approve of a change in user or class without
another full sca1 e demonstrati on. The property has been avail ab1 e at a good
price. He will not reserve the site for years waiting for a higher quality
restaurant.
r~ember Campbell commented hi s support for a conti nuance on thi smatter. He
further asked if the reversion process can be stopped once a 3-month notice
has been given. Mr. Desrochers stated the process can be reversed.
Mr. Bob Nightingale, representing the Soup Exchange, addressed the Agency. He
stated his company has a high quality, unique prototype building proposed for
this site. It wi 11 be an Irvine Ranch, market concept with high qual i ty
salads, soups, fresh pasta, and fresh baked goods. He will provide copies of
renderings of current open locations as well as addresses.
MSUC (Malcolm/Campbell) to conti nue thi s item for two weeks and have staff
prepare what is necessary to implement reversion.
ITEM NO.3: REPORT: SELECTION OF HOTEL DEVELOPER FOR THE STREET / MERZIOTIS
PARCEL
Before beginning the presentations by the two finalists, Member Malcolm had
questi ons regardi ng the pending litigation in thi smatter. He stated the
Agency is bei ng sued in a uni que way because the a rgument goes beyond money.
The plaintiff is trying to set aside the Redevelopment Agency's right to
acqui re the property. Member Malcolm is concerned the City/Agency may be in
jeopardy if they lose the suit and the property has a structure a1 ready
constructed on it.
Agency Attorney Harron stated there was an agreement in the 1 ease that Mr.
f4erziotis had with Mr. Street when the Ci ty took the property that he cou1 d
not assign it without the consent of Mr. Merziotis. The argument in the case
is that he assigned it to the City of Chu1a Vista and that by doing so he lost
all rights to the property so that the City of Chu1 a Vista took nothing.
However, that is not what happened. The property was not assi gned to the
City. The property was condemned. The City took the property by emi nent
domain. In response to t4embe r Malcolm's question what happens if the
litigation is successful, Agency Attorney Harron stated the Agency must have
full disclosure with anyone being dealt with in this matter.
Community Development Di rector Desrochers stated he spoke to Mr. Daley, the
speci a 1 counsel assisting in this matter, this week and di scussed this
question with him. Through the Order of Immediate Possession and the
transacti ons that have taken p1 ace, a ti t1 e company shou1 d be ab1 e to issue
ti t1 e. Indemnification would not be a problem.
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Redevelopment Agency Minutes -3- October 2, 1986
Mr. Desrochers stated there are two proposals for the Agency to review. Eagle
Corporation and InnSuites International representatives both had presentations
using the slide projector.
A coin f1 i p determi ned Eag1 e Hotel Corporati on as giving the fi rst
presentati on. Mr. Bob Foster of Eagle Corporation and Mr. Bill Ho 11 enbec k,
Regional Western Director of Hampton Inns, made the presentation. Mr. Foster
stated they are part of the family of Ho1 iday Inns. Resi dence Inn is an
all-suite concept. Hampton Inn is the Holiday Inn economy line. The propo sa 1
consists of a IIhote1 comp1ex" including 80 suites (Residence Inn) and 130-room
Hampton Inn. Residence Inn is an extended stay suite concept. Hampton Inn is
a limited-service concept.
Member McCand1 i ss asked the representatives if they were made aware of the
comp1 i cated status of the property when they were submi tti ng thei r proposa 1.
Mr. Foster responded he was not made aware, however, he is not put. off by the
problem. He is sure that it could be resolved.
Michael Harty, Vice President of Real Estate Development of InnSuites, and Mr.
James Wi rth, Chai rman and owner of InnSuites, made thei r presentation. ~1r.
Harty described their proposal as a mi dd1 e market sui te hotel, full service,
sui te mi x. Thei r proposal call s for a phase 2 development. InnSuites is
interested in worki ng with the City in creating a superi or architectural
desi gn.
Member Moore stated he is concerned about the 2 phases of development. Mr.
Harty explained the second phase addition allows the use of the latest design,
decor, etc. It provides a new profile and allows for another grand opening.
It is a marketing effort building identity and clientele.
Member McCand1 i ss asked the representatives of InnSuites if they had been
apprised of the complicated nature of the land at the time they were preparing
thei r proposal. Mr. Ha rty stated he was aware of the condemnation
proceedi ngs. Hi s discussion with staff indicated ti t1 e insurance cou1 d be
secured for the property. He feels it is a workable problem and can be
reso 1 ved.
~1r. James S. Marinos, Attorney representi ng the owners of the property,
addressed the Agency. He suggested the Agency not go forward with this
matter. He stated his clients have fi 1 ed a cross complaint that legally
chall enges the ri ght of the Ci ty to take thi s property. Mr. Marinos further
stated he believes it is imprudent and substantially premature to be
entertaining the idea of hotel development on this property at this time. He
believes the title of the property is in serious question. Mr. Marinos asked
the Agency to delay acti on on this matter, opening the situation up to
additional data and input. Hi s clients will be submitting a settlement
proposal in the next 60 to 90 days that wou1 d resu1 tin two thi ngs: 1) an
amicable resolution of the lawsuit, and 2) a mutually acceptable plan for the
development of this property.
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Redevelopment Agency Minutes -4- October 2, 1986
MSUC (Campbell/Moore) for Closed Session to discuss litigation regarding this
issue.
In response to the Members request to give background on this property,
Community Oeve10pment Di rector Desrochers stated many proposals have been
revi ewed for thi s site. It has been very comp1 i cated to develop the site
because of the Securi ty Exchange Commission's 1 ease ho1 d interest in the
property. This was one of the reasons, along with Ca1trans' possible need for
the property, the City decided to acquire the property and clear title. There
are approximately 5 acres of developable property for this site. The type of
de vel opment bei ng looked for is a hotel/motel of hi gher qual ity that what is
presently in the City; somethi ng that is a gateway development to the
Bayfront. The staff is in favor of the InnSuites proposal for two reasons:
1) room rates are higher over all; and 2) their flexibility as to design.
Chairman Cox asked if any of the existing Merziotis parcel is going to be used
by Caltrans. Mr. Desrochers stated at this time it does not appear that
Caltrans is going to need any of the Merzi oti s property, however, the
possibility does still exist.
Member Malcolm commented he believes InnSuites is the better of the two
proposal s. InnSuites' willingness to be flexible in design is the only way
this proposal will be acceptable to him and if it makes a major statement. If
the City is willing to contribute towards making this a major statement then
he could support this proposal.
Member McCand1iss stated she likes what InnSuites has to offer. Thei r
proposal gives a variety of use the City does not have. Wi th rega rd to the
Residence Inns, she has a concern with the Hampton side because the Agency is
looking for an upscale use. The Residence Inn is too much like a time-share
with a full kitchen and in the long run may hurt the support servi ces
(touri st/vi si tor industry) that the City is tryi ng to attract. Member
McCand1iss is comfortable with InnSui tes, however, she will not accept
anything less than a dramatic architectural statement.
Member Moore wanted to know the key reason Mr. Street's development proposals
never came to fruition. Mr. Desrochers stated Mr. Street was proposing to use
the entire 7 acres and made arrangements with the long-term lessee of the rear
parcel. However, he had a diffi cu1 t time getti ng fi nanci ng because of the
1 ease on the property. He had a 1 ease over the sub-1 ease, as well as fee
interest on the property. Subordination for a loan was difficult to obtain.
Member Moore asked if the Security Exchange's lease hold interest was paid off
when the lease was purchased. Mr. Desrochers responded yes.
RECESSED at 8: 59 to Closed Sessi on deal i ng with subjects of potential and
pending litigation.
RECOI VENED at 9: 16 p. m.
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Redevelopment Agency Minutes -5- October 2, 1986
Chairman Cox stated he concurs with comments made regarding InnSuites as the
better proposal. He also expressed the desi re to have a dramati c and very
significant entryway into the City of Chu1a Vista.
Member Moore expressed hi s concern aga in about the bui 1 di ng of a second
phase. He would like to have this explained further as staff works with the
app1 icant.
MS (Ma1co1m/McCand1iss) to approve the InnSuites proposal in concept and to
authori ze the two member subcommittee to bri ng back an agreement regardi ng
final completion as well as a fi nanci a1 arrangement on a major architectural
statement on the site, possibly with Agency participation.
Member Malcolm stated the subcommittee is not precluded in negotiating a lease
instead of a sale.
Member Moore suggested a 90-day peri od in whi ch to negoti ate and report back
to t~e Agency.
The motion passed unanimously.
CONSENT CALENDAR
Member Moore requested items No. 8 and 9 be pulled from the Consent Calendar.
Member McCand1iss requested item No.5 be pulled.
CHAIRMAN COX OFFERED ITEMS 4, 6, 7, AND 10 FROM THE CONSENT CALENOAR, the
reading of the text was wai ved by unanimous consent, passed and adopted
unanimously.
ITEM NO.4: RESOLUTION 730 GRANTING $400,000 TO BA YFRONT CONSERVANCY TRUST
TO BE EXPENDED SOLELY FOR NIC INTERIOR EXH IBITS
AND FURNITURE, FIXTURES AND EQUIPMENT
ITEM NO.6: RESOLUTION 731 ENTERING INTO AN OWNER PARTICIPATION AGREEMENT
WITH JAMES SCHRAEFEL
ITEM NO.7: RESOLUTI ON 732 APPROVING CHANGE OF "DEVELOPER" CONCERNING TC/OP
#84
ITEM NO. 10: RESOLUTION 733 APPROVING SUBORDINATION AGREEMENT WITH HOUSING
OPPORTUNITIES, INC.
ITEM NO.5: RESOLUTION 734 APPROVING NATURE INTERPRETIVE CENTER CHANGE ORDER
NO. 1 MODIFYING THE THREE-STORY TOWER AND
APPROPRIATING $8,982 FOR REDESIGN
On June 5, 1986, the Redevelopment Agency approved a contract with Ramm
Contracting Company for the construction of the Bayfront Nature Interpretive
Center. In addition, the Agency authori zed a Change Order to reduce the
contract and modify the three-story tower building, and directed staff to work
with the architect to design a two-story tower with an access ramp.
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Redevelopment Agency Minutes -6- October 2, 1986
Coulter Winn, Architect with Winn-Cutri Architects, addressed the Agency. lie
reported that the Nature Interpretive Center is currently approaching 40%
completion of the main building. There have been a total of $9900 to date in
change orders which is approximately 11% of the contingency.
RESOLUTION OFFERED BY MEMBER MALCOLM, the reading of the text was waived by
unanimous consent.
Member Moore asked how many change orders there have been and if they are
charged to the Agency. Mr. Oesrochers stated the Agency pays for the change
orders. There have al so been credi ts. There is a procedure set up in the
City Building and Housing Department and Engineering Department to review all
the Change Orders. The C1 erk-of-the Works a1 so reviews all of the Change
Orders. All of the mi nor change orders are hand1 ed through thi s procedure,
any major change orders would come before the Agency.
The Resolution was passed and adopted unanimously.
ITEM NO.8: REPORT: APPROVING FINE ART FEATURE FOR ONE PARK APARTMENTS
When the Agency approved the design for One Park one of the conditions
required that the project be subject to the Town Centre 1% Fine Arts Fee since
the developers had not presented an actual work of art for review. Mr. Zogob,
the developer, now wishes to provide an on-site art piece in lieu of the fee
and requests that the Agency rescind the original condition.
Member Moore questi oned the 1 ocati on of the Fine Arts feature. Community
Development Director Desrochers responded the art feature will be very visible
to Memori a1 Park and the parki ng structure. There wi 11 be an access gate to
the private parking area, behind which the art feature will be placed on a
pedestal. Chai rman Cox suggested movi ng the Fine Arts feature just outsi de
the gate or at least have an unimpeded view. Member Moore suggested directing
staff to work with developer and have him find a better posi ti on for the
sculpture to be viewed by the public.
MSUC (McCand1iss/Moore) to accept staff recommendati on and incorporate the
suggestion to change the 1 ocati on of the sculpture to heighten public
vi sibi 1 ity.
ITEI4 NO.9: REPORT: AUTHORIZATIOI TO ISSUE AN RFP FOR B IOLOGI CAL STUDIES
WITHIN THE OTAY VALLEY ROAD REDEVELOPMENT PROJECT AREA
The Agency has authori zed preparati on of p1 ans for the real ignment of Otay
Valley Road and the subdivision and development of properties south of the
roadway which fall within the Otay River floodplain. Representatives from the
U.S. Army Corps of Engineers have advised staff that Section 404 permits may
be required for development in this area. In order to prepare p1 ans which
will be envi ronmentally sensi ti ve and qual ify for Secti on 404 permi tti ng, it
is necessary to undertake specific biological studies of this area to provide
information concerni ng opportunities for development and mitigation for
projects requiring fill in wetlands.
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Redevelopment Agency Minutes -7- October 2, 1986
Member Moore asked about the expenditure of $30,DDD for thi s study and asked
for fu rther information. Community Development Di rector Desrochers stated
when the Envi ronmenta1 Impact Report was prepared it was di scovered that the
Corps of Engineers and the U.S. Fish and Wil dl ife Service had some
juri sdi cti on because of ri pari an habitat that is in the Otay Valley area.
This study wi 11 provi de miti gati on responses so that the Otay Valley road
alignment can be ascertained.
t4S (r400refl.1cCand1 i ss) to accept the report.
Chairman Cox stated the City has just recently gone through a reorganization
proc%s with the Ci ty of San Di ego regardi ng two parcel s east of 1-805 and
southerly of the exi sti ng boundary of the redevelopment di stri ct. He wanted
to know if any consideration had been given to including these properties for
the purposes of this biological study. Redevelopment Coordi nator Kassman
stated it was deci ded to proceed with the study for just the project area at
this time in order to move this project along.
The motion passed unanimously (4-D; Member Malcolm not present for the vote).
DIRECTOR'S REPORT: None.
CHAIRMAN'S REPORT:
MSUC (Cox/1400re) to have a Closed Sessi on for purposes of di scussi ng pendi ng
litigation, eminent domain action, and Sierra Club vs. Marsh, et. a1. (dealing
with 54 and 1-5 widening project).
Chairman Cox asked for an update with regard to the status of reconstructing
the covering knocked down in front of Chu1 a Vista Photo. Redevelopment
Coordinator Kassman stated one bid for rebui 1 di ng the structure has been
received to date. He is anticipating the work will be done soon.
Chairman Cox further stated he has been contacted by Mr. Christianson
regarding suggestions for downtown parking.
MSUC (Cox/McCand1iss) to direct staff to prepare a report regarding Mr.
Christianson's suggestions concerning downtown parking.
Chai rman Cox stated staff is to be commended for removal of graffi ti at the
area across from Paul Thoryk' s parcel. However, he was concerned about
graffiti at the F Street bridge.
MSUC (Cox/Malcolm) direct staff to remove graffiti at F Street bridge.
MEMBER COMMENTS:
Member Campbell reques ted a statement of the financial status of the
Redevelopment Agency. Executive Di rector Goss stated he wi 11 supply this
information.
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Redevelopment Agency Minutes -8- October 2, 1986
Member Malcolm stated he disagrees with the City Attorney and his ruling on
the Brown Act. He stated he will talk to anyone that wants to tal k to him
about any item, regard1 ess if they have spoken to 2 or more council members.
Member Malcolm would like to have the Agency/City Council write the Attorney
General and ask him for a specific ruling.
MS (Malco1m/McCand1iss) direct City Attorney to get additional input from the
Attorney General regarding the Brown Act.
Agency Attorney Harron stated he has contacted the Attorney General before on
thi s matter and was deni ed an opinion on the case presented. Mr. Harron
bel i eves the Attorney General is not willing to give an opinion. Mr. Harron
suggested having a person with a concern come to an open session where
everyone will hear the same information.
The motion passed unanimously.
ADJOURNED at 10:13 to Closed Session for purposes of discussing pendi ng
litigation, eminent domain action, and Si erra C1 ub vs. Marsh, et a1; from
Closed Session to a meeting of October 7, 1986, 110wing the City Council
meeting scheduled to begin at 4:00 p.m.
au . Desrochers
Executive Secretary
WPC 2532H
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