HomeMy WebLinkAboutrda min 1985/08/08
MINUTES OF AN ADJOURNED REGULAR MEETING OF THE REDEVELOPMENT AGENCY
OF THE CITY OF CHULA VISTA, CALIFORNIA
Thursday, August 8, 1985 Council Conference Room
4:00 p.m. Ci ty Ha 11
ROLL CALL
MEMBERS PRESENT: Chairman Cox; Members Malcolm, Moore, McCandliss, Scott
MEMBERS ABSENT: None
STAFF PRESENT: Acting Executive Director Asmus, Community Development
Di rector Desrochers, Agency Attorney Harron, Finance
Director Christopher
CLOSED SESS I ON
MSUC (Cox/Scott) to go into Closed Session for purposes of Bayfront
litigation regarding the Section 404 permit.
The meeti ng recessed for Closed Session at 4:02 p.m. The Agency meeti ng
reconvened at 4:40 p.m.
ITEM NO. 1 - WORKSHOP - BAYFRONT ECONOMIC EVALUATION
The firm of Gruen Gruen + Associates has been working with Agency staff and
the Chula Vista Investment Company in order to prepare an economic pro forma
for the Bayfront Redevelopment Project. The i nformati on provi ded by the
consultants will serve as the basis for the negotiations between Agency staff
and officials of the Chula Vista Investment Company (CVIC).
Executive Director Goss reported that the consultants are available to provide
economic i nformati on relative to infrastructure cost and payment for the
Bayfront Redevelopment Project.
Dr. Claude Gruen, Gruen Gruen + Associates, 564 Howard Street, San Francisco,
94111 , distributed copies of a matrix describing the steps involved in the
financial analysis process. He noted that assumptions have been made whereby
prospective developers would take raw land and develop it for sale. The unit
costs used in the estimates are bonding costs and should not be considered as
actual construction costs, but instead used as a basis for comparison. The
summary provided to the Agency with their packets included a list of design
and indirect fees for development. However, it was noted that due the
magnitude and diversity of development possibilities, these figures should not
be assumed as exact or all-inclusive.
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Workshop Session of
the Redevelopment Agency - 2 - August 8, 1985
Discussion ensued relative to the square footage rates used as examples for
development in the Bayfront. Community Development Di rector Desrochers
pointed out that this i nformati on was based on statistics obtai ned from
Col dwell Banker. Dr. Gruen further pointed out that during the initial
conversations between the City of Chula Vista and the Chula Vista Investment
Company, basic defi ni ti ons as to what shoul d be buil tin the Bayfront were
derived from the Specific Plan. Therefore, these projections can be changed.
Mr. Jack Dimond, representing Chula Vista Investment Company, explained that
CVIC's proposals are based on the City's Specific Plan of the Bayfront
Redevelopment Project. For example, in the business park, CVIC propose
improvements of the same type that are currently buil tin Chul a Vi sta, whi ch
go for 45¢ per square foot. He explained the estimated cost per square foot
that would be charged in the various phases of the project as well (i.e.,
fi rst phase - 75¢/sq. ft., fourth phase - 95¢1sq. ft.). He added that all
revenues and cost of construction are proposed in 1985 dollars.
Dr. Gruen narrated a slide presentation displaying land values and projected
rents, including infrastructure costs to be incurred by Chula Vista Investment
Company.
In response to Member Malcolm's question, Community Development Di rector
Desrochers explained that Rick Engineering prepared a study that also included
school fees. CVIC applied this information which had a significant impact on
thei r cost. The cost for the Gunpowder access and ti del ands have increased
si gni fi cantly because of the envi ronmental demands that must be incorporated
into all desi gns. Mr. Desrochers added that staff has confidence in the study
prepared by Rick Engineering.
Di scussi on by the consultant ensued relative to the present infrastructure
cost, $49 mi 11 i on; establ i shi ng an assessment di stri ct so that the property
owner would incur the infrastructure cost; and additional assessments charged
as a result of Coastal Commission di recti on that the City maintain the
wetlands.
Member Malcolm expressed concern as to the direction staff is going regarding
requests for funding for the infrastructure costs. In response, Mr. Charles
LeMenager, representi ng Chul a Vi sta Investment Company, stated that CVIC has
studied all the vari ous construction costs as well as City revenue and
variables. These figures have been run through the computer and are available
upon request by the Agency. Executive Director Goss interjected that the City
has not taken a posi ti on du ri ng discussions regardi ng this sUbject. He
clarified that CVIC has not requested a fee and it is staff's intent to obtain
direction from the Agency in order to develop a position. Member McCandliss
stated that until a rate of return is determined for this project, the return
is still negotiable.
Chairman Cox questi oned the proj ected dates 1 i sted on the various tables
submitted by the consultant. Dr. Gruen explained that the indebtedness runs
out in the year 2017. The life of the Redevelopment Project itself expires in
the 1990s.
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Workshop Session of
the Redevelopment Agency - 3 - August 8, 1985
Mr. Joseph Davis, representing Watt Industries (a joint venture partner with
Santa Fe Railroad) stated that the project must make sense for both the City
and CVIC to be feasible. It is his contention that there shoul d be a
reasonable rate of return for the risks involved. Mr. LeMenager added that
three years ago when this project was undertaken, the developers realized that
the land would be difficult to develop. Therefore, CVIC embarked upon thi s
venture with a spirit of partnership and hope that it would continue.
In response to Member Malcolm's request, Executive Di rector Goss indicated
that the assumpti ons di scussed by Mr. LeMenager coul d be provi ded for the
Agency to review at Tuesday evening's Council meeting.
Chairman Cox thanked the Gruens for their presentation and attendance at this
afternoon's meeting and, on behalf of the Redevelopment Agency and CVIC, he
welcomed a groundbreaking in the near future.
ITEM NO. 2 - REPORT: CONSIDERATION OF HIRING CONSULTANT FOR BAYFRONT RELATED
MATTERS
Chairman Cox noted that staff would not be able to provide an oral report
regarding this item this afternoon.
ADJOURNMENT AT 5 :45 p.m. to the mi d-month meeti ng of Thursday, August 15,
1985, at 4:00 p.m.
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