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HomeMy WebLinkAboutcc min 1993/03/04 RDA PRESENT: Members Fox, Horton (arrived at 4:15), Moore, Rindone and Chairman Nader ALSO PRESENT: John D. Goss, Executive Director; Bruce M. Boogaard, Agency General Counsel; Chris Salomone, Executive Secretary; and Berlin Boswo~h, Secretary to the Redevelopment Agency Bus.ss 2. MIDBAYFRONT DISPOSITION AND DEVELOPMENT AGREEMENT ISSUE~ - On 10/27/92, the City Council approved and adopted the Chula Vista Local Coastal Program Resubmittal (LPC No. 8) based upon the Bayfront Planning Subcommittee's Alternative Plan and corresponding General Plan Amendment. On 1/15/93, the California Coastal Commission adopted LCP No. 8 with modifications, on 10/17/92, Council directed staff to- undertake disposition and development agreement negotiations. The Redevelopment Agency workae~ion/meeting is to examine negotiating positions to facilitate resolution. Community Development Director Salomone presented a project overview and highlighted the meeting discussion items, stating the list of eight issues were: (1) City/Redevelopment Agency flnnncial participation in the project; (2) development of the Cultural Arts Center; (3) Nature Inteq~retive Center operational costs; (4) Ice skating ~ with 5000 seat capacity; (5) shared parking in the Core Resort area; (6) satisfaction of the low-income housing requirement; (7) disposition of the Merzintis parcel; and (8) waiver of fine arts fees and certain permit fees. Mr. Salomene noted staff had additional information to impart to the Agency in order to receive clarification and direction for continued negotiations to proceed. Member Rindone commented it was critical that the negotiations continue with Mr. Barkett and not be delayed concurrent with whatever negotiations may occur with the Port District. Chairman Nader cautioned that the Development Agreement negotiations not preclude a Port development project. Member Rindone stated he wanted a clear understanding that the Development Agreement negotiations with Mr. Barker would continue while the discussions with the Port took place. He wanted to be sure there was no disagreement among Agency members or staff on that. Mr. Salomone stated Council's direction with respect to Issue 1, City/Agency financial participation in the project, as of January 1992 was clear that there would not be. However, as staff and Mr. Barker had moved through the Development Agreement, the amenity package in the project had an impact on the financial feasibility of the project and should that amenity package be kept in place it would necessitate participation by the City. He informed the Agency that a new proposal was made by Mr. flarkett to the City and that it had not heretofore been considered by the Agency. He stated that financial participation was the most critical issue of the Development Agreement negotiations. He noted there was a Development Agreement in format and staff and Mr. Barker wanted to start filling in the blanks. Staff would like to give Mr. Barkett the opportunity to continue fruitful negotiations. Chairman Neder desired to know what was contained in the new proposal. Executive Director Goss pointed out that the new proposal consisted of the underlined material on page 5 of the staff memorandum. Mr. Salomone continued his summary. He acknowledged that, Item 2, development of the Cultural Arts Center, MINUTES March 4, 1993 Page 2 was the key amenity to the project, staff had hired a consultant to conduct a study on the impact of the cultural arts center on the project. The issue being that the cultural ax~ center, as it was envisioned by the Council in its recommendation, the project could not pay for the Center out of its revenues and remain feasible. The project without the cultural arts facility was marginally feasible. Staff desired to discuss the financing plan and the contribution of land by Mr. Barkatt to the City for the Center. He said that, Item 3, Nature Interpretive Center operational costs were to be paid through a Benefits Tax Assessment District, which were estimated to be $500,000 yearly. Mr. Barkett had a proposal that he would fund part of that through an endowment or in another I~mnner. Council gave direction that an Ice Skating Rink, Item 4, was an amenity they would prefer to have in the project or, a park or amphitheater, but that Council considered the ice skating rink an amenity the community would enjoy. He said that staff would discuss the impact of the ice skating rink on the project sa well as the type of ice skating fink Mr. Barkett wanted to build with his own resourees. Mr. Barker had proposed to build in the project a more multi-faceted, multi-purpose type facility. Member Rindona commented that the perception of how the Agency viewed the project as well as the terminology being used was important. To refer to the cultural arts center and the ice skating rink es ameoities was not in his vocabulary. He stated, for himself, he considered them central ingredients to the project. When Council voted on the project it was his understanding the two facilities were viable elements of the project and they should not be referred to as amenities. They were essential ingredients that provided a project uniquely beneficial to the City and highly desirable. Member Horton asked if the ice skating rink was an essential part of the project. Member Rindona responded the package the City Council voted on was to provid6 a unique project that benefitted all of the community and he did not want to start fragmenting any or part of the project at the early stage of negotiations. Chairman Nader stated those were issues on which Council gave very clear direction and the cultural arts center was an integral part of the project. Council direction on the ice skating rink was that it could be replaced with a park for public use if that was necessary for the economic feasibility of the project. It was his underslmlding that direction concerning the cultural arts center was to negotiate how to achieve development in the early part of the project. Mr. Salomone pointed out that Item 5, Shared Parking, was a concept that had not been presented previously. Council had stated Item 6, Satisfaction of the Low-Income Housing Requirement, could be mitigated off-site. As concerned Item 7, Disposition of the Merziotis Parcel, Mr. Barkett had requested that the City dedicate or deed the land to him for development or that he be given a right of first refusal. Staff's position was to cooperate with Mr. Barkett, however, the Agency may wish to develop it autonomously. Finally, Item 8, Waiver of Fine Arts and Certain Permit Fees, had been asked for as part of the Development Agreement. Those fees might, at a later date, warrant consideration depending on the project as it came before the Council in its fmal stages. Mr. Salomona additionally commented that on Item 1, Council direction was clear, uo Agency or City financial participation in the project; Council directed staff to do a femibility analysis, which was subsequently performed by Williams-Kuebetheck and Associates, Inc., and the analysis showed that the project was marginally feasible without the cultural arts facility and without the ice skating rink. He noted there was no closure on the actual rate of return during Council discussion, but it was clear that the project would require Agency participation without those two items. Recently, Mr. Barkett presented staff with a proposal that would mitigate some of the concerns about the feasibility of the project. That was, he would build the project without any City participation up front. One of the concerns of Council was the heavy front loaded costs--the underground parking, the lagoon, the parks, the mitigation, and such. Mr. Salomone stated that Mr. Barkett was now saying he would bear that burden but that he wanted the City to return to him a portion of the revenue; project revenues up to $3 million would be split 2/3rds for the City and 1/3rd for the developer; anything above $3 million and up to $4.6 million would be 57.5 percent for the City and 42.5 percent for the developer; and any revenues to the City above $4.6 MINUTES March 4, 1993 Page 3 million would be 40 percent for the City end 60 percent for the developer-all after the City's costs to service the project, capped at $1.9 million annually in current dollars-in perpeAuity. Mr. Salomoue also noted that Council's direction on Items 1 through 4 wes clear but staff had returned with additional information. He stated that shared parking was en item the Agency did not take un action on but wes a concept that had not been presented to the Agency previously and that the Planning Department recommended consideration of the concept. As concerned low-income housing, Mr. Salomone acknowledged that the Agency had stated it could be mitigated off-site end that staff had several ideas es to mitigating the low-income housing requirement which were unique. He noted that Mr. Berkett wented the 5.2-acre Merizotis property, located on E Street end I-5, owned by the Agency cledi,'-*t~ or deeded to him for development in his project es a whole or that he be given a right of first refusal. Staff's position was to cooperate with Mr. Barkett; however, the Agency may wish to develop it autonomously. Mr. Salomone explained that Mr. Barkett had asked for the waiver of certain fees es part of the Development Agreement, but that while there wes not a lot of precedent for this, staff believed that the Parks Fee end Fine Arts Fee did warrant consideration for waiver at a later date depending upon the project in its final stages. Paul Peterson, Esq., Peterson & Price, representing the lend owner (William Barkett), 530 B Street, Suite 2300, San Diego, CA 92101-4454, noted there had been a drastic change in the project and the subject of participation was lest discussed. Mr. Barkett was prepared and had proposed that he would put in th~, whole project up-frout with private capital end without City participation. There would be no risk to tho City. He had asked, however, in return that he would like to participate in some of tho incremental tax benefits that would come out of tho project. Mr. Peterson stated that Mr. Barkett was esked, es part of the approval of the project, to develop a financial plen so that the City could have a cultural arts center. Mr. Barkett had done so. William Barkett, Chula Vista Investors, 864 Prospect Street, La $olla, 92037, discussed his reason for making the sharing of project-generated revenues proposal. He stated that while a definite figure of income to be generated by the project could not be ascertained, by his being totally responsible for the up-front fmuncing of the project in its entirety, he should share a part of the revenue benefits he would create. Member Fox asked why Mr. Barkett felt he should share in the revenue benefits in perpetuity. Mr. Barkett responded that was his proposal but that while length of time wes not locked in concrete, he believed he was entitled to share es he would be taking the risk and not esking the City to take a risk. Member Rindone asked the definition of buildout at $450 million. Mr. Barkett replied that would be the first phase, not the full buildout. He proposed, as the first phase, what would be basically the Core, everything within Marina Parkway and 169 residential units in the Residential sector. He poin~exi out that for the market he sceked for the feasibility of the project which would be a conference center destination resort for people, he would buildout the Core es one unit. The Port, Mr. Barker believed, would likely build one hotel at a time end not have the critical mass or infrastructure in order to make the concept work. Member Rindone agreed. Member Moore esked if the buildout included Mr. Barkett building the cultural arts center end skate rink. Mr. Barkett stated no. He went on to state that it wes his belief that the Council end Bayfrout Planning Subcommittee mandated him to donate the land and prepare a financing study. He wm prepared to donate the land end had completed the financing study. He believed that wes the extent of his obligation, not to finence end build the cultural arts center. Member Fox asked what guarantee Mr. Baskett would offer to the City, if eny, that he would have the resources necessary to do what he had proposed. MINUTES March 4, 1993 Page 4 -- Mr. Barkett responded that would be the subject of the Developmeot Agreement; but that he thought Council had directed the posting of a bond or some third party assurance that the City would be assured that the project would be completed. He stated that there was more interest in the development of this project than he had dreamed possible given the economic conditions existent in California. Mr. 5alomone interjected that an aspect of the Development Agreement framework would be that Mr. Barkett provide evidence of financial resources. Fred Pierce, Price Waterhouse, 750 B Street, Suite 2400, 5an Diego, CA 92101, stated the nature of the land uses within the project created more than just property tax increment for the City; it is a use that has a significant hotel component which would generate significant transient and occupancy tsxes- celculated at $ percent-from thc 1610 hotel rooms as well as sales tax increment--celculated at I percent of projected retail eales-generated from the project. [Mr. Pierce distributed a table indicated Price Waterhousu financial analyses.] The fiscal impact from the project had been calculated by Price Waterhouse and had identified the cash flow over a 25-year period which indicated a total of $73.9 million as the sum of cash flows from property taxes which would accrue to the benefit of the City and/or Redevelopment Agency over that 25-yesr time period. The property tax increment shown on the table was net of the 20 percent affordable housing sot-aside as well as an assumed 70 percent capture of the property tax increment to the Redevelopment Agency with a 30 percent sharing with other taxing agencies or authorities. In the reversion, when the redevelopment district was over, the table assumed 17 percent of the propet~:y taxes accruing to the City. Member Moore asked the life of the project. Mr. Pierce responded that in the Price Waterhouse calculations, the life of the redevelopment district was assumed to be 25 years. Mr. Barkctt proposed to participate in perpetuity. The interest that would accrue to the owner of the property wes subtracted out from the reversion to calculate out the net reversionary interest to the City would be. The analysis showed a total tax increment (net present value) of $104 million was arrived at by adding the $73.8 million (listed under cash flow) and $30.9 million (listed under the reversion) and subtracting out present value of what it would cost the City to provide services to the project--indicating an $85.0 million net fiscal impact to the City· The City's consultant had felt that number was on the order of $52.0 million. That number (net fiscal impac0 was subject to assumption--based on operational assumptions of the hotel properties. The proposal that was submitted was a form of tax sharing, subordinated to the provision of services out of tax increment and some sharing arrangement below that--a $52 million number derived by Williams~Kuebelbeck and Associates and a $85 million number derived by Price Waterhouse--would be a sharing of the estimated numbers. Mr. Pierce commented on the overall economic impact of the project. He noted there would be approximately 1700 permanent jobs created in the City at total buildout with a majority of them being in the first phase. There would be an average of 700 jobs created coustroction for an estimated eight year period. In years two through five construction would be at its pemk and there would be approximately 1000 construction workers on-site building the project. He stated that annual visitor spending is eetimeted, in current dollars, to be $118 million yearly-at the hotels, meals in hotel restaurants, and spending in the retail centers, health clubs all within the project. There would be a multiplier effect, estimated at 2.12, on consumer expenditures which would generate so that for every $112 million there would be an economic impact of $212 million in the region, which would toUd about $250 million at current dollars. Member Rindone asked if the $118 million figure was estimated at full buildout. Mr. Pierce responded that was correct. Mr. Pierce stated it was a worid.-class facility--by its size, its features and amenities that would create visibility for the City of Chula Vista in a similar manner as La Costa had done for the City of Cerlsbad. The project would attract bi-national as well as regional residents into Chula Vista who were not currently visiting Chula Vista. It would be an international and national tourist attraction by virtue of the nature of the orientation of the conference hotel facilities. MINUTES March 4, 1993 Page 5 Mr. Pierce reiterated Mr. ]~rkett's a~ment that he was not ~ring the City to put its credit rating or bonding capacity on the line for the project. He stated Mr. Barkett was interested in a subordinated parlicipatiun by the City. Additionally, the tax increment from the project was an additional source of revenue to the City. He noted that the project could not bear the economic burden of building the cultural arts facility, but the project could bear the burden of contributing the land. The interest Mr. Barkett had proposed was purely contingent-if the project was not as successful as he envisioned he would get nothing; if the project was successful, the City would get a substantial tax increment end the developer would ~hare in that. Mr. Pierce stated that a project of that scale end magnitude with its complexity, features and mitigation requirements, in the 1990s required some form of public participation or it could not move forward. It required public participation in order to offset some of the monumental costs. The project, after reviewing the 20-year history of the bayfront, would conceivably flounder if it did not get a 'jump start' end push in that form as a part of the Development Agreement. It seemed to him that by the City participating in a subordl,at,~l interest without putting up bonds would be an effective, cheap insurance policy to give some solid foundation to the project so that it could move forward in a public/private partnership. Executive Director Goss asked Director of Finence Christopher to what extent the City would be at risk should there be a default on the assessment district bonds. Mr. Christopher responded that the developer's approach had changed. Originally the developer talked about assessment district bonds to finance infmstroctore. The risk to the City with assessment district financing was very limited. If the City were doing general obligation-type financing, there was definitely a risk. Mr. Christopher stated that the figures presented were developed by Mr. Barker end his consultants, Price Waterhouse? end in his estimation extremely optimistic end that he did not desire the Agency to make a decision to go ahead or consider participation in the project based on the $84 million figure. The figures were developed several years prior end did not take into account that the Bayfront project already had an on-going deficit to the Operating Fund; nor does it take into account current information--for instance, the City lost 16 percent of the property tax increment in the Redevelopment Agency end the State had proposed for FY 93-94 to transfer 27 percent of property tax increment from agencies to school districts end also 27 percent of cities property tax. That had not been reflected in the cash flow figures end could have tremendous impact on the amount of money generated from the project. Additionally, the cash flows reflected a revisionary revenue in perpetuity which the Redevelopment Agency had never agreed to that calculation. Mr. Christopher asked that the Agency direct staff to make a more detailed evaluation of the cash flow numbers should they went to consider rebating a portion of the revenues to the developer. Member Moore noted that for the Chula Vista Center, Homart put up $37 million and the City put up $7 million; and again with the expansion of the Center, the City put up $2.6 million and Homart put up about $7 million. He asked staff to come back with an explanation/comparison. Member Moore also mentioned the Commercial Power Center on East H Street, the Auto Sales Park: he wanted to know how much they put in and how much the City/Agency would be putting in. Member Moore stated that with the development of the Bayfront without the requirement of access to Gunpowder Point and D Street Fill-those lands having been given to U.S. Fish and Wildlife-there should not be a subsidy. But should the Agency/Council say it wanted land for a cultural arts facility, ice skating rink, more land for park land end open spaces, and scale back the number of hotel rooms end residential units, then there might be some rationale for subsidy from the City. Mr. Barkett responded to Mr. Christopher stating that he did not want the City to accept his number of $84 million cash flow number nor did he have to accept the City's number-that if the project succeeded, everybody wins. If he did not succeed, the City would still win. He said he was not saying adopt his proposal, but some such similar proposal. He stated that the project could not be compared to other projects as nothing like it had been done in California. With respect to Homart, the Auto Sales Park, and the Commercial Power Center the City enticed those businesses to do their projects, otherwise the projects would not have been done. He did not want the money to entice him to build his project; he wanted the oppommity to create his own value and share in what he would be creating. MINUTES March 4, 1993 Page 6 " Chair Nader declared that a cultural arts complex was an integral pa~ of the proposed project. He asked that staff package those two issues with the developer--D] form of public participation and [2] financing of the cultural arts complex and report back periodically on the status of negotiations. Chair Nader stated his view that he did not see public financial participation without early construction of the cultural aria complex. Member Herren said that land was set aside to be devoted to the cultural atta complex. She stated that the project, without the cultural arts center, would still be of great benefit to the community even without the cultural arts center being built in the early stages as it may not he ~onomically feszible to build it at that time. Chair Nader expressed his view that the project without the cultural a~s center was not the project he had voted for and he would find it difficult to support public fimmcial participalion without the cultural arts complex. Member Moore explained that the project, as approved by Council, was that the developer would donate the land and provide the City with a financial plan, not a design plan, and that there was nothing there that the developer, the Port, or the City would build the cultural arts center. The project did not'include building a structure called the cultural arts center. Chair Nader said that staff should pursue the development of the finance plan. Member Fox stated that he helieved the cultural arts center was an integral part of this development; the finance proposal was innovative-type thlnlring for the 1990s, the sharing in poq~etuity was somewhat excessive, and that the percentages of the tax sharing was also excessive, but that they were at a starting point from which to work. He stated his agreement with Chair Nader, that should the negotiations proceed along those lines, then the cultural __ arts center could not be separated out of the project, i~} Member Rindoue acknowledged that when the design of the project was developed with the intent of a cultural arts center and that it was clear in the approved plan that it was to be built in Phase 1 end a parmership would need to be developed to he sure that was accomplished. The new proposal the developer has presented has to be examined very carefully and very seriously. It was refreshing to acknowledge that the Agency, developer and staff were looking at creative ways to maintain the financial risk to City he very limited and also continue to go forth with a world-class project. Member Horton stated that while she agreed that the cultural arts center was an integral part of the whole plan she did not think the Bayfront Planning Subcommittee voted to make the cultural arts center mandatory to he in the first phase of construction or that it be tied in with the development. The Subcommittee wanted the land to be provided and know that it would be built sometime in the future. Mr. Barkett made the comment that a possible way to proceed would be that he had agreed to donate the land and had prepared the financing plan for the cultural arts center six months prior. It was his view that the cultural arts center was a City requirement end the City had its own mechanism to get projects done. He stated he had given the land to the City and offered to write the donation of the land into a contract, the City could take the land and build the cultural arts center when it wanted it built. He stated his obligation was to provide the lend and the financing plan and he considered his obligation complete with respect to the cultural arts center and he did not want his project held up because of the cultural arts center. If the City was going to put more obligations on him he wanted to hear them through the Development Agreement uegoliation process. MSUC [Moore/Nader] to refer this item back to staff to explore types of any subsidy and compare those subsidies with the other three major projects-Homart's Chula Vista Center, both phase, the Auto Sales Park, and the Commercial Power Center--and other anbsidized projects within the past 10 years; with and without financing of the cultural arts center, and analyze the developer's numbers for the f'mancing mechasli~n. Member Fox questioned if the motion would require staff to analyze the developer's new numbers on the financing mechanism. MINUTES March 4, 1993 Page 7 Member Moore responded that he would include that in the motion. Chair Nader agreed as second. Member Rindone asked why the comparison to the other three projects as the project was unique in and of itself. Member Moore replied that the Agency needed to get the information. Mr. Goss stated that the benefit(s) from this project and the benefit(s) from other projects should be included in the analysis. Chair Nader said any supporting information that staff could generate would be helpful and beneficial. Member Horton requested that the motion include staff re-evaluating and coming back with new and different figures on the sharing of tax revenues proposal put forward by the developer. Member Moore agreed that was hnplied in the motion. Member Rindone asked what the response time would be before staff could return with the information. Community Development Director Salomone replied staff could return with the information in 30 days. Member Rindone asked that the information be provided to the Agency members one week prior to the meeting. Motion passed 5-0-0. Paul Peterson, Esq., asked that a definitive date and time for the next workshop be set. MSUC [Moore/Fox] to set the date and time for the next Bayfront Meeting/Worksession on April 1, 1993 at 4:00 p.m., passed 5-0-0. Mr. Salomone stated that it had been stslTs position that a benefit assessment district would be set up to finance the operating cost of the Nature Interpretive Center (N1C). The developer wanted that benefit assessment district spread Citywide and he wanted an endowment that he would, perhaps, place $1,000,000 in the endowment which would provide for his obligation to the NIC. Chair Nader asked if staff had an opportunity to do an analysis of the endowment proposal and how that would compare to the original direction of Council to establish a benefit asaassment district. Mr. Salomone replied no detailed analysis had been made. Mr. Goss said he did not believe staff should drop the benefit assessment district alternative but that staff should be authorized to explore the endowment proposal. MSUC [Horton/Nader] refer back to staff to analyze the options of a benefit assessment district and/or an endowment for the Nature Interpretive Center, passed 5-0-0. Mr. Salomone explained that new information regarding the ice skating rink had been developed. Council had desired an ice skating ~ in the project and if not that, then construction of a park at the same location. The developer had indicated his de~im to build thc ice skating rink as he saw it as a desirable amenity. The proposal that the developer had presented was for a multi-purpose type facility. There was the possibility that the facility would serve some of the functions that a cultural arts center could in the interim. The facility would have the capacity as an ice skating rink, but multi-uses could accommodate a sports team as well as being a venue for concerts and cultural events. MINUTES March 4, 1993 Page 8 MSUC [Rindone/Horton] to give the developer the flexibility to develop the ice skating rink as a multi- purpose, multi-use ice skating rink facility, passed 5-0-0. Member PAndone said that a good comparison of this type facility, though it was on a smaller scale, would be the Pasadena Convention Center. Chair Nader wanted it understood that the facility would not be prasented later as a substitute for a cultural arts complex. Member Rindone replied that was a reasonable request in order to obtain the ice skating rink which was in the heart of the project. Mr. Salomone stated that staff had been exploring the uae of the SDG&E right-of-way for the shared parking concept. Member Moore asked if shared parking was restricted to the SDG&E right-of-way. Mr. Salomona replied it would not be. Mr. Barkett interjected that the concept of shared parking came into being with regard to the ice skating rink, a 5000 seat facility, end the tennis arena facility. What the developer was proposing was that there would not be two separate events simultaneously--one in the ice skating rink end one in the tennis facility, but to have a separate amount of code parking for each facility. The 5DG&E right-of-way parking would be used for overflow or some other major event taking place. Mr. Barkett stated his plen, as proposed, called for parking, according to code, for a 4000-seat tennis arena and a 5000 seat ice skating rink. Member Moore asked how many seats the cultural arts center would have. Mr. Barkett responded that that would be part of the cultural arts center proposal end a separate issue. Chair Nader said his motion would authorize staff to explore shared parking concept for the cultural arts complex. Mr. Barkett said that before the number of parking spaces could be determined, even with shared perking, the Agency needed to determine the seating capacity of the cultural arts center. At present, the City's proposal celled for a 1500 seat capacity. He desired to know if the City wanted to figure parking on that or on a 2000 seat or 2500 seat facility. Member Horton stated her belief that a 1500 seat capacity was not adegoat~ for the type facility envisioned which was distinctively different from others in the area and that would be a major facility. Member Rindone mentioned the concept of the water taxi serving Sen Diego, Coronado end Chula Vista, in lieu of people arriving by vehicles, as well as file people traveling by trolley needed to be considered in determining parking requirements. He requested that the seating capacity be determined at not less than a 2000 seat facility. MSUC [Nader/Rindone] to authorize staff to consider shared parking for the ice skating rink, the tennis facility, and the cultural arts center, passed 5-0-0. Mr. Salomone stated Council previously allowed the consideration of off-site mitigation of the low and moderate income housing requirements. The developer was required 100 units of low end moderate income housing. Staff and the developer were looking at creative ways to address it-alternatives that preserve at risk low income housing being one. The item would be brought back to the Agency when it was more fully explored. MINUTES March 4, 1993 Page 9 Member Moore stated that buying an existing apartment building was just replacing low and moderate with low and moderate income housing which did not increase low and moderate income housing stock. However, to keep at-risk housing available for the low and moderate income housing market was worth consideration. Member Rindone said he did not want low and moderate income housing concentrated in only one section of the City. Mr. Salomone then discussed the developer's request that the Merziotis property be deeded over to his project so that it could be developed in concert wflh his development, so that there would be nothing on the Merziotis property that was not compatible; or, at the very ieard he was asking for first right of refusal to purchase that property. He acknowledged staff's position, stating that the Agency had been approached recently by at least two developers and staff was not willing to give up the property or offer the right of first refusal. In any case, staff would work in cooperation with Mr. Barkett on the development of that property, the Agency would have to in order to get access as the property was landlocked. Mr. Salomone informed the Agency that the developer had asked for consideration of the waiver of the Fine Arts fees for the project. He stated that staff's position was that as there was no precedent for D.I.F. fees to be waived on a project of that type, staff would not entertain the request. The two fees that staff may consider for application of waivers at a later date would be the Park fees and the Fine Arts fee as there was precedent that if there were Fine Art features in a project that were of public benefit--and the project had some opportunity for that-we could request the Fine Arts fee be waived; and, the parks provided in the project were in excess of the park areas provided in a normal project. Staff wanted to analyze the two fees without recommending waivers now, but with the understanding that staff could at some future date recommend they be waived. MSUC [Fox/Moore] to accept staff's recommendation to consider proposing a waiver of the Fine Arts and Parks fees at a later date, approved 5-0-0. Member Rindone asked staff what their current thoughts were on school mitigation. Mr. Salomone replied that the developer and the school district were in negotiations end staff was a party to those. He explained that school mitigation was a General Plan requirement and that it was a condition of the project. Member Moore stated that he thought the school district should be looking at expanding an existing site. ORAL COMMUNICATIONS None. 3. DIRECTOR'S REPORT(S) - None. 4. CHAIRMAN'S REPORT(S) - None. 5. ~E~MMENTS - None. MINUTES - March 4, 1993 ~ Page 10 ADJOURNMENT AT 5:52 P.M. to the Adjourned and Special Joint Meeting of the Redevelopment Agency/City Council of Tuesday, March 9, 1993 at 6:00 p.m., immediately following the City Council Meeting, in the Council Chambers, Public Services Building. Respectfully submitted, Berlin D. Bosworth, Secretary to the Redevelopment Agency [c:\wP51 \AGENCYhMINUTl~\03-04-93 .MIN]