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HomeMy WebLinkAboutcc min 1991/05/28 RDA 1 Copy of Minutes for Notebook/File - M]NUTF~ OF A SPECUR, MEJ~'IING OF THE ttJaU~.vr_,J..UJ-aq.r.,~ t At~mxlt.¥ OF ~ ~ LY OF ~ ~A Tuesday, May 28, 1991 Co~cfl Ch~bers 6:53 p.m. Public Se~ces Bu~d~g ~ TO O~ 1. RO~ ~ P~S~: Membe~ M~colm, Nader, ~done, ~d Cha~ Moore ~O P~SE~: Jo~ D. Goss, D~ector; ~ch~d D. Rudolf, ~sist~t ~ency A~omey; ~d Beverly ~ Au~eler, CiW Clerk 2. APPROVAL OF MINLrFES: None. BUSINESS 3. WRri-i-//N COMMUNICATIONS: None. 4. RESOLUTION 1172 APPROVING sEMI -EXCLUSIVE NEGOTIATI ON AGR EleMENT WiTH PALII.'IC S(~aNE INC. (PSD FOR DEVELOPMENT OF COMMERCIAL SHOPPING CENTER AT THE SoIYrH SIDE OF PALOMAR :~-iREET BE'r~{uq INDU~-i-RIAL BOULEVARD AND BROADWAY; AUTHORIZING CHAIRMAN TO EXECUTE SAID AGR I~RMENT; AND AUTHORIZING THE EXECUTIVE DIRECTOR TO ENGAGE IN A~I'IIE. S AND ENTER INTO CONTRACrS AS NECESSARY TO DEVELOP THE EXPANDED CENTER PLAN FOR AN AMOUNT NOT-TO-EXC~.gr~ $100,000; AND APPROPRIATING $250,000 THEREFOR-In August 1990 the City, the Redevelopment Agency, and Pacific Scene, Inc. entered into an "Expanded Plan Agreement' regarding the proposed commercial shopping center. PSI and staff are exploring the feasibility of an expanded center plan; PSI has been pursuing acquisition of additional adjacent properties and has need of Agency assistance in this regard. Staff recommends that the Agency approve a Semi-exclusive Negotiation Agreement with Pacific Scene, Inc., including not-to-exceed $150,000 Agency assistance, authorizing the Executive Director to engage professional services necessary to process the shopping center plan, and appropriating $250,000 therefor. - 4/Sths Vote Requ/red David Gustafson, Assistant Director of Community Development, reviewed the semi-exclusive negotiating agreement with the Redevelopment Agency and Pacific Scene, Inc. He then gave a brief history of the project. Pacific Scene, Inc. is now asking for the following considerations due to the length of the process: 1) build the project in one construction phase, if that is not possible they woUld like to develop in two phases, the first being a 15 acre parcel and the second the 3 acre comer parcel, and 2) they be assisted in this extended processing process with fee assistance from the Agency in the amount of $150,000. The agreement allows Pacific Scene to phase the project with incentives built in to move the project along in one phase if possible and provides $150,000 of Agency funds. The requirements are that Pacific Scene would pay back the $1S0,000 if they built the center out or if they breached the agreement. They woUld pay back 50% if the project did not go forward if both parties acted in good faith. The Semi-exclusive Negotiation Agreement replaces the existing Expanded Plan Agreement. The City Attorney felts that the new document was more sound in structuring negotiations for a Disposition and Development Agreement and in allowing for owner participation rights. There is a significant change in the Agreement to one of the conditions which requires that 65 percent of the tenancy of the expanded volume center be tenants that woUld yield annual sales tax in excess of $275 per square foot. It was felt that such yields were unrealistic so a more realistic figure of $150 per square foot/per year in sales tax generation was added. The Agency retains the May 28, 1991 Page 2 right to approve 6S percent of the project tenancy. There is a strong desire by Pacific Scene to resolve the agreement as soon as possible. Pacific Scene does have specific objections to several components they would like to discuss with Council before signing the agreement. Jim Moxham, 2801 Albatross Street, San Diego, CA, representing Pacific Scene, Inc., distributed a copy of a letter from Pacific Scene, Inc. Member Malcolm questioned whether staff or the legal department had seen the letter submitted. He did not feel the meeting was a place to negotiate the seven items listed in the letter. He requested that the City be given until Tuesday to work their requests out. Mr. Moxham did not want to work out the details of the agreement from the podium but stated there were significant payments that had been deferred until tomorrow. He would therefore like to move forward in the hope that Council could reach a consensus on the issues. Member Rindone agreed with Member Malcolm and questioned what problems would be caused by a delay. He felt the agreement should be referred back to staff. Mr. Moxham responded that the problems would be economic but were problems that Pacific Scene would deal with. He felt most of the items could be dealt with readily by working with staff. Items #7 regarding the repayment of the $150,000, would be the most significant issue. Pacific Scene had worked with the project for over three years and had expended over $600,000. Issues such as the approval of the FIR, disposition end development agreement and conditions unknown at this time, were all outside of their control. He requested that if any of those events occur they not be required to repay the funds. Member Malcolm felt flexibility'was build into the contract. Items 3, 4, 5, and 6 were minor items that would be easily agreed upon. He did not feel Item I could be reached upon by the City as long as an outside time limit was set. He then reviewed the original plan as submitted and stated that the Agency had requested a bigger center, condemnation of 7-11, and moving the church and other businesses. He felt that if the FIR was not approved by the Agency their request was not unreasonable. The agreement should be good for Pacific Scene and the Agency. Mr. Gustafson stated that staff was familiar with the conditions and they would be comfortable with all requests except for Item 7. Director Goss questioned whether the Attorney felt the condition of the FIR being approved would prejudge or put leverage on that decision and therefore would not be as unbiased as it might be. Chairman Moore noted that the zoning had been changed from industrial to commercial. If there was a concern over the EIR, or if it failed on something within the original acreage there would be no refund. If it had to do with the expanded acreage the repayment would then be considered. Member Nader stated that the approval or disapproval of the FIR was strictly in determining whether the FIR was adequate not whether the project was desirable. If the EIR was legally inadequate the Agency should hold the consultant preparing the document responsible, not the Agency or the applicant. The developer pays for an EIR done by a consultant picked by the City, this procedure should not be departed from. If the Agency approves the EIR and denies ~e project for other policy reasons, then the Agency should discuss the amount the developer is entitled to based on the amount they had paid and work done to that point. He felt Item 7 repaid not only the cost of the FIR but other fees also. Minutes May 28, 1991 Page 3 Director Goss stated that verbiage needed to be included that the Agency would act reasonably. Agency Attorney Rudolf stated that Pacific Scene was requesting language in 6.B.4 which could be changed to state that the developer has no obligation in that event. Pacific Scene felt that they should not be held responsible if the project is turned down for reasons that are out of their control. Member Rindone felt the Agency was negotiating the agreement from the dias and recommended tha~ the item be continued to a special meeting to be held after the Gouncil meeting on Tuesday night. Staff'needed sufficient time with legal counsel to work out the agreement. MSUC (Rindone/Malcolm) to continue the itm to a spedal meeling to be held immediately after the City Council meeting on June 4, 1991. Chairman Moore questioned whether this continuance was inappropriate. Mr. Gustafson responded that it was not inappropriate for staff. Mr. Moxharn responded that it was not inappropriate if the Agency felt it necessary. Mr. Salomone felt that staff had received sufficient direction from the Agency and would meet with Pacific Scene in resolving Item 7. $. ORAL COMMUNICATIONS: None. OTHER BU~ 6. D3R~,.ECTOR'S REPORT None. 7. GHAIRMAWS REPORT None. 8. MEJVIBERS' COMMENTS None. ADJOURNMF2qT ADJOURNMENT AT 7:25 P.M. to a Special Meeting of the Redevelopment Agency scheduled for Tuesday, June 4, 1991 at 4:00 p.m., immediately following Council Meeting. Respectfully submitted, BEVERLY A. AUTI-~.I.ET, CMC, City Clerk Vicki C. Soderqulst, Deputy ~ Clerk ?