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Home My WebLink AboutRDA Packet 1997/10/21 '" declare un"cr pcn-!ty of pc,'"rv the! 1 am em 10"01 by ~:c ";¡", 0" "h':", '101" In thc d P ,f' ,"'en,,:' ",'" il':rmð that I poste Com""", t! ,e"c" " " the" ,I\'c~ '0' , " . ,~:;;: ~~ the Tuesday, October 21, 1997 Pu;1 c e.v ces "'d'1 n , ,11 ' a, "'t~,4 ~ L'1 ' <¡¡ouncil Chambers 6:00p,m, , , ,:)~TE,~SIGNED~1 J.. Puè!te Servlces Bmldmg (mnnedIately followmg !he CIty CouncIl meelmg Joint Meeting of the Redevelopment Agencv/Council of the City of Chula Visla CALL TO ORDER 1. ROLL CALL: Agency/Council Members Moot -' Padilla -' Rindone -' Salas -, and Chair/Mayor Horton - 2. APPROVAL OF MINUTES: October 7, 1997 (Joint meeting) CONSENT CALENDAR (NONE SUBMITTED) ORAL COMMUNICATIONS This is an opportunity for the general public to address the Redevelopment Agency on any subject matter within the Agency's jurisdiction that is not an item on this agenda. (State law, however, generally prohibits the Redevelopment Agency from taking action on any issues not included on the posted agenda.) If you wish to address the Agency on such a subject, please complete the "Request to Speak Under Oral Communications Form" available in the lobby and submit it to the Secretary to the Redevelopment Agency or City Clerk prior to the meeting. Those who wish to speak, please give your name and address for record purposes and follow up action. PUBLIC HEARINGS AND RELATED RESOLUTIONS AND ORDINANCES The following items have been advertised and/or posted as public hearings as required by law. If you wish to speak to any item, please fill out the "Request to Speak Form" available in the lobby and submit it to the Redevelopment Agency or the City Clerk prior to the meeting. 3. PUBLIC HEARING: REGARDING THE SALE OF SPACE NUMBER 122 AT ORANGE TREE MOBILEHOME PARK--In November 1987, Orange Tree Mobilehome Park converted to resident ownership. The Agency assisted the residents in purchasing their park with a $600,000 acquisition loan which was converted to loans for lower income residents to help them purchase their spaces. At that time, 29 residents did not wish to purchase their space, and the Agency agreed to purchase these spaces after the newly-formed homeowner's association was unable to secure financing to purchase these unsold spaces. The residents who did not purchase their space remained as renters. The Agency's desire is to sell these spaces as new home buyers move into the park, The Agency currently owns 16 spaces, having sold 13 spaces. Staff recommends approval of the resolution. (Director of Community Development) Agenda -2- October 21, 1997 AGENCY APPROVING THE SALE OF SPACE NUMBER 122 AT ORANGE TREE RESOLUTION 1561 MOBILEHOME PARK AND AUTHORIZING THE COMMUNITY DEVELOPMENT DiRECTOR TO EXECUTE A PURCHASE AGREEMENT 4, PUBLIC HEARING: CONSIDERATION OF AN AMENDED AND RESTATED OWNER PARTICIPATION AGREEMENT WITH SCRIPPS HEALTH FOR THE EXPANSION OF HOSPITAL AND RELATED FACILITIES AT THE NORTHEAST CORNER OF "H" STREET AND FIFTH A VENUE--On 11/7/91, the Agency approved an Owner Participation Agreement with Scripps Memorial Hospital (now Scripps Health) for expansion of their hospital. Changes in the medical services industry resulted in substantial downsizing of Scripps' expansion plans. Scripps and City staff have negotiated an amended Agreement. Staff recommends approval of the resolution. (Community Development Director) AGENCY ADOPTING AN EIR ADDENDUM 90-07 A AND APPROVING AN RESOLUTION 1562 AMENDED AND RESTATED OWNER PARTICIPATION AGREEMENT BY AND BETWEEN THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA AND SCRIPPS HEALTH FOR THE EXPANSION OF HOSPITAL AND RELATED FACILITIES AT THE NORTHEAST CORNER OF "H" STREET AND FIFTH AVENUE ACTION ITEMS The items listed in this section of the agenda are expected to elicit substantial discussions and deliberations by the Agency/Council, staff, or members of the general public. The items will be considered individually by the Agency/Council and staffrecommendations may in certain cases be presented in the alternative. Those who wish to speak, please fill out a "Request to Speak" form available in the lobby and submit it to the Secretary to the Redevelopment Agency or the City Clerk prior to the meeting. 5. AGENCY ADOPTING NEGATIVE DECLARATION IS-98-02, DEEMING ALL RESOLUTION 1563 OWNER PARTICIPATION RIGHTS WAIVED, AND APPROVING AND PURCHASE AND SALE AGREEMENT BY AND BETWEEN THE CITY COUNCIL OF CHULA VISTA, AND THE RESPECTIVE PROPERTY RESOLUTION 18801 OWNERS OF 3554 MAIN STREET, CHULA VISTA, FOR THE PURPOSES OF SITING THE OTAY GYMNASIUM PROJECT--On 5/6/97, the Agency/Council authorized staff to negotiate for the acquisition of property at 3554 Main Street for the proposed Otay Gymnasium. An Initial Study was conducted and a Negative Declaration was issued for public review. Staff recommends approval of the resolution. (Community Development Director) Agenda -3- October 21, 1997 OTHER BUSINESS 6. DiRECTOR/CITY MANAGER'S REPORTfS) 7. CHAIR/MAYOR'S REPORTtS) 8. AGENCY/COUNCIL MEMBER COMMENTS ADJOURNMENT The meeting will adjourn to the Regular Redevelopment Agency Meeting on November 4, 1997 at 4:00 p.m., immediately following the City Council meeting, in the City Council Chambers. [M: \HOME\COMMDEVIAGENDAS\1 0-21-97 .AGD] MINUTES OF A JOINT MEETING OF THE REDEVELOPMENT AGENCY/CITY COUNCIL OF THE CITY OF CHULA VISTA Tuesday, October 7, 1997 Council Chambers 5:05 p.m. Public Services Building CALL TO ORDER 1. ROLL CALL: PRESENT: Agency/Councilmembers: Moot, Padilla, Rindone, Salas, and Chair/Mayor Horton ABSENT: Agency /Councilmembers: None ALSO PRESENT: Executive Director/City Manager, John D, Goss; Legal Counsel/City Attorney, John M. Kaheny; and City Clerk, Beverly A. Authelet CONSENT CALENDAR (Items pulled: none) CHAIR/MAYOR HORTON OFFERED THE CONSENT CALENDAR, headings read, texts waived, passed and approved unanimously 5-0. 2. APPROVAL OF MINUTES: September 16, 1997 3. a. RESOLUTION 1557 APPROVING PRELIMINARY PLAN FOR THE AMENDMENT TO THE TOWN CENTRE I REDEVELOPMENT PLAN - The Agency directed staff to proceed with amendments to the Bayfront and Town Centre I Redevelopment Plans to allow addilional time for removal of blighting conditions and impedimenls lhat prohibit the Agency from completing its redevelopment goals and objectives in each Project Area. In addition, the Agency proposes to amend the Bayfronl Redevelopment Plan to add approximately 145 acres of Port District property in order to facilitate redevelopment of these properties as well. Approval of the Preliminary Plans is the first step in the plan amendment process. Staff recommends approval of the resolutions. (Community Development Director) b. RESOLUTION 1558 APPROVING PRELIMINARY PLAN FOR THE AMENDMENT TO THE BA YFRONT REDEVELOPMENT PLAN Member Rindone stated that in the recommendation he observed that the timetfame for the Agency to collect tax increment for the Bayfront was 2024 and for the Town Centre was 2026. He asked what was the cause for the two year difference. Pam Bucham, Principal Community Development Specialist, replied that they were initiated two years apart. The Bayfront was initiated in 1974 and the Town Centre was initiated in 1976. We are extending both to the maximum. 4. AGENCY RESOLUTION 1559 AND COUNCIL RESOLUTION 18791 APPROVING A PROFESSIONAL SERVICES AGREEMENT WITH KEYSER MARSTON ASSOCIATES, INC. TO SERVE AS A MARKET ANALYST AND FINANCIAL FEASffiILITY CONSULT ANT TO THE CITY OF CHULA VISTA AND CHULA VISTA REDEVELOPMENT AGENCY ON A PROJECT -BY-PROJECT BASIS - Until expiration of their contract, Keyser Marston Associates, Inc. had been the City's consultant for the last several years, On 7/2/97, staff sent requests for qualifications to 25 firms; 5 firms responded. A City Manager/Executive Director-approved panel reviewed the proposals and interviewed each firm. Based upon the panel's recommendation, staff recommends approval of lhe resolution. (Communily DeVeiopmenl Director) 02-1 - . .. - Minules October 7, 1997 Page 2 5. RESOLUTION 1560 EXTENDING THE OWNER PARTICIPATION AGREEMENT WITH LAWRENCE M. AND STEPHEN P. CUSHMAN, DATED SEPTEMBER 1,1992, FOR A PERIOD OF TWO YEARS - On 09/01/92, the Agency and owners of approximately 10 acres of property located at 517 Shinohara Lane entered into an Owner Participation Agreement. On 03/01/94, the Agreement was extended for lwo years; and then on 11/07/95, the agreement was extended for an additional two years. The Owners have graded the site but have not applied for building permits due to adverse economic conditions impacting industrial development in the region, The owners are now requesting an extension until 10/17/99 in order to apply for building permits and start construction. Staff recommends approval of the resolution. (Community Development Director) . . . END OF CONSENT CALENDAR' . . ORAL COMMUNICATIONS There were none. PUBLIC HEARINGS AND RELATED RESOLUTIONS AND ORDINANCES 6. PUBLIC HEARING CONSIDERATION OF AN AMENDED AND RESTATED OWNER PARTICIPATION AGREEMENT WITH SCRIPPS HEALTH FOR THE EXPANSION OF HOSPITAL AND RELATED FACILITIES AT THE NORTHEAST CORNER OF "H" STREET AND FIFTH A VENUE - Scripps has requested that this item be continued to the meeting of October 21, 1997. (Community Development Director) MSUC (HortonlPadilla) to continue the item tn October 21, 1997. Motion carried unanimuusly 5-0. ITEMS PULLED FROM THE CONSENT CALENDAR No items were pulled. OTHER BUSINESS 7. DIRECTOR'S REPORTtS) - none. 8. CHAIR'S REPORTtS) - none. 9. AGENCY MEMBER COMMENTS - none. ADJOURNMENT The meeting adjourned at 5:08 p.m. Respectfully submitted, Beverly A. Authelet, CMC/AAE City Clerk ;2..;1... - . - - REDEVELOPMENT AGENCY AGENDA STATEMENT Item .J Meeting Date 10/21/97 ITEM TITLE: PUBLIC HEARING: REGARDING THE SALE OF SPACE NUMBER 122 AT ORANGE TREE MOBILEHOME PARK RESOLUTION ¡Sill APPROVING THE SALE OF SPACE NUMBER 122 AT ORANGE TREE MOBILEHOME PARK AND AUTHORIZING THE COMMUNITY DEVELOPMENT DIRECTOR TO EXECUTE A PURCHASE AGREEMENT SUBMITTED BY: C"~""ity D,..,o"". m.~. REVIEWED BY: Executive Director ~~ /J (4/liths Vote: Yes- No_XJ BACKGROUND: In November 1987, Orange Tree Mobilehome Park converted to resident ownership. The Agency assisted the residents in purchasing their park with a $600,000 acquisition loan which was converted to loans for lower income residents to help them purchase their spaces. At that time, 29 residents did not wish to purchase their space, and the Agency agreed to purchase these spaces after the newly.formed homeowner's association was unable to secure financing to purchase them. The residents who did not purchase their space remained as renters. The Agency's desire is to sell these spaces as new home buyers move into the park. The Agency currently owns 16 spaces, having sold 13 spaces. RECOMMENDATION: That the Agency conduct a public hearing, consider testimony, and adopt the resolution approving the sale of Space 122 at Orange Tree Mobilehome Park at 521 Orange Avenue for $20,750. BOARDS/COMMISSIONS RECOMMENDATION: Not applicable. DISCUSSION: This tenant for Space 122 has sold the coach in order to move to another location. The Community Development Department currently has a buyer interested in purchasing the property. The value of the property has been appraised at $21,000 and the buyer has offered to purchase the lot for $20,750. Staff recommends accepting the offer. If approved, the Community Development Director will be authorized to execute the purchase contract and related documents for space number 122 as approved by the City Attorney's office. FISCAL IMPACT: Proceeds of the sale will be deposited into the Agency's Low and Moderate Income Housing Set.Aside Fund. Staff costs are minimal and budgeted in the Low.Mod Housing Fund. IJFI H,\HOME\COMMOEV\STAFF.REPll0,21.9710TMHPI22,113 [October 10, 1997 19,37amll J-I RESOLUTION NO. /~ëøl RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA APPROVING THE SALE OF SPACE NUMBER 122 AT ORANGE TREE MOBILEHOME PARK AND AUTHORIZING THE COMMUNITY DEVELOPMENT DIRECTOR TO EXECUTE A PURCHASE AGREEMENT WHEREAS, the Redevelopment Agency currently owns mobilehome spaces at Orange Tree Mobilehome Park located at 521 Orange Avenue, Chula Vista; and, WHEREAS, these spaces are leased to tenants on a month-to-month basis; and, WHEREAS, the City wishes to sell the Agency-owned property at this park; and, WHEREAS, Article 11, Section 33431 of the California Community Redevelopment Law requires that a Public Hearing be held for any sale or lease of Agency-owned property without competitive bidding; and, WHEREAS, said Public Hearing has been conducted pursuant to Section 33431 for the sale of the vacant parcel know as space number 122 in the Orange Tree Mobilehome Park. WHEREAS, the property is being sold for its approximate fair market value. NOW THEREFORE, THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA does hereby find, order, determine and resolve to approve the subject sale of the parcel know as space number 122 in Orange Tree Mobilehome Park and authorizes the Community Development Director to execute a purchase agreement, financing documents, and related documents on the terms and conditions presented, in final forms approved by the Agency Attorney. Presented by Approved as to form by ~~ Chris Salomone Director of Community Development ItJFI H,\HOMElCOMMDEV\RESOSlOTMHP152,RES {Ootob" 7, 1997 ",23pmlt .J'-Ø1. .. . . JOINT REDEVELOPMENT AGENCY/COUNCIL AGENDA STATEMENT Item 4 Meeting Date 10121197 ITEM TITLE: PUBLIC HEARING: CONSIDERATION OF AN AMENDED AND RESTATED OWNER PARTICIPATION AGREEMENT WITH SCRIPPS HEALTH FOR THE EXPANSION OF HOSPITAL AND RELATED FACILITIES AT THE NORTHEAST CORNER OF "H" STREET AND FIFTH AVENUE RESOLUTIDN /$"~;l ADOPTING AN EIR ADDENDUM 9O.O7A AND APPROVING AN AMENDED AND RESTATED OWNER PARTICIPATION AGREEMENT BY AND BETWEEN THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA AND SCRIPPS HEALTH FOR THE EXPANSION OF HOSPITAL AND RELATED FACILITIES AT THE NORTHEAST CDRNER OF "H" STREET AND FIFTH AVENUE SUBMITTED BY: Community Development Director ¿, "'!,. REVIEWED BY: Executive Directoð (4/Sths Vote: Yes- Nol) BACKGROUND: The Agency approved an Owner Participation Agreement (OPA) with Scripps Memorial Hospital (now Scripps Health) on November 7, 1991 for expansion of their hospital located on UH" Street to include additional bed capacity, two medical office buildings and a parking garage. The expansion was to take place on an 8.9 acre site located at the northeast corner of "H" Street and Fifth Avenue within the Town Centre II Redevelopment Project Area. Early in 1995, Scripps staff informed City staff that plans for redevelopment of the site would be amended due to changes in the medical services industry which would result in substantial downsizing of their expansion plans. Later that same year, revised expansion plans were submitted to, reviewed and recommended for approval by the Design Review Committee. In February 1996, Scripps submitted a restated OPA incorporating their new plans to City staff. Following negotiations between Scripps and City staff, mutually acceptable business terms were developed and submitted to the Agency on January 7, 1997 for conceptual approval. Based upon their inclusion in the restated OPA, the Agency approved the following terms (A 113 included as Exhibit C). 1. The Agency will collect in.lieu payments currently due to the City under the OPA from Scripps' failure to develop the site as scheduled totalling $113,193. Scripps will receive credit for all verified property tax increments paid from land and improvements on the redevelopment site towards the amount due. 4.. I Page 2, Item ~ Meeting Date 10/21197 2. Scripps will be required to continue the payment equal to the tax increments accruing from their purchase of the property for approximately half of the site as contemplated under the original OPA in an amount not less than $16,000 annually. 3. Scripps will make annual in.lieu payments totalling $36,000 for the proposed oncology center if not constructed by June 30, 1999. This payment will increase by 2% yearly from that date. 4. Scripps will make annual in-lieu payments for the first medical office building proposed under the revised plans if not constructed by June 30, 2003 in the amount of $80,000. This amount will increase by 2% annually from that date. 5. The first medical office building will be located per approved site plans on the corner of "H" Street and Filth Avenue. The second medical office building will be located between the oncology center and the hospital expansion. If the second medical office building is not constructed by June 30, 2005, Scripps will make in- lieu payments in the amount of $80,000. This amount will increase by 2% annually from that date. 6. Scripps will guarantee that the redevelopment site will be devoted to medical services and related uses until 2014. 7. In-lieu payments shall cease upon expiration of the Redevelopment Plan 12028). City and Scripps staff and consultants proceeded to work out the details of the terms and conditions and finalize the Agreement. In the process of doing so, the condition relating to payment of past due in lieu fees was further negotiated and revised. All other terms approved by the Agency are included in the restated agreement (see Exhibit E). The document presented to the Agency this evening has the support and recommendation of City staff and has been approved by Scripps. RECOMMENDATION: That the City Council and Agency hold the public Hearing, and that the Agency adopt Addendum 90.07 A and approve the amended and restated Owner Participation Agreement with Scripps Health. BOARDS/COMMISSIONS RECOMMENDATION: The Redevelopment Agency and City Council, in a joint meeting on November 7, 1991, approved a conditional use and special permit for the original hospital expansion proposal. The Agency and City Council also authorized condemnation of real property and conveyance of the site to Scripps without competitive bidding. Finally, at the same meeting, the Agency and Council approved an OPA with the developer. Because of the size of the agenda package, the original OPA is not attached but is available for review at the Community Development Department. 4...;1. - - Page 3, Item ~ Meeting Date 10121/97 On July 24, 1995, the Design Review Committee (DRC) reviewed and conceptually approved the revised expansion plans for the hospital and related facilities. The letter of approval from the DRC to the developer is attached as Exhibit A. The revised plans for the project are attached as Exhibit B. On January 7, 1997, the Agency reviewed the status of the project and conceptually approved business terms and directed staff to negotiated final terms of an amended OrA. The agenda statement and minutes from the Agency's meeting are attached as Exhibit C. The Economic Development Commission (EDC) reviewed the project at their meeting of September 3, 1997. The Commission endorsed the project as being in the best interests of the City. The EDC has submitted a letter to the Council with their recommendation. The Town Centre I Project Area Committee, which also serves a the Project Area Committee for the Town Centre II Project Area, will review the project at their October 2, 1997 meeting. The recommendation will be presented orally to the Agency/Council. DISCUSSION: SITE UTILIZATION. COMPARISON OF ORIGINAL AND REVISED PLANS The original and current site plans for the hospital expansion at the northeast corner of Fifth Avenue and H Street are attached for comparative purposes as Exhibit D. The original plans included the expansion of hospital facilities to accommodate 100 additional beds, updated emergency treatment facilities, two medical office buildings and a parking garage. The original project was to be phased with one medical office building comprising approximately 63,000 square feet and hospital expansion comprising 120,000 square feet occurring in Phase 1. The medical office building was to have been completed by mid.1995. The phase I hospital expansion should have been completed this year. Phase II of the original proposal was to consist of a second medical office building (62,000 square feet), additional hospital office expansion of approximately 133,000 square feet, and a sizeable parking garage. Since approval of the expansion project in 1991, substantial changes have occurred in the medical services industry. These changes were promulgated by efforts by the Federal government to control costs, the proliferation and consolidation of health maintenance organizations and the consequential changes in health delivery systems to become more efficient and cost effective. This has resulted, in part, in a reduction in the need for in-patient hospital facilities as illustrated by the number of hospitals which have recently closed or have been acquired and consolidated. In order to stay competitive and profitable, Scripps has had to re-think plans for expansion of its Chula Vista campus which resulted in the decision to downsize expansion and somewhat reoriented priorities. The revised plans substantially reduce Phase 1 development on the site to a 13,000 square foot oncology center (not proposed in the original plans) in what was to be the location of the parking garage and a scaled back, 34,000 square foot (twenty-four intensive care beds) hospital expansion which includes modernizing of emergency 4..~ Page 4, Item JL Meeting Date 10/21/97 room facilities. The remainder of the site in Phase I is devoted to surface parking and landscaping, with the exception of the Redi-Care and First Interstate Bank (FIB! buildings which were to be demolished under the original plans, but now remain in place until Phase II is developed. The former users have been relocated and Scripps has taken over use of the boildings for additional office space. The oncology center would be developed immediately. Hospital expansion is subject to State review and will commence construction in December 1997. The second revised phase includes a 60,000:t square foot medical office building on the present site of the Redi. Care and FIB buildings to be developed by 2003. If market conditions warrant, an additional medical office building will be constructed between the oncology center and the expanded hospital. If the additional office buildings are constructed in Phase II, a multi-story parking garage will be added. A side-by-side comparison of the improvements to be constructed under the original and revised expansion plans, assumino comDlete build out, is presented below. COMPARISON OF PHASE I SQUARE FEET Original Plan Revised Plan Phase I 182,740 Total s.t. 47,000 Total s.f. Hospital Expansion 1 119,560 (99 beds) 34,100 (24 beds) Medical Office Buildings 63,180 (1 bldg.) -- Oncology Center (not in original plan) 12, 900 s.f. Parking Onsite 370 spaces 331 spaces Parking Garage N/A N/A COMPARISON OF PHASE II SQUARE FEET Phase II Original Plan Revised Plan Additional Development 194,810 s.f. 207,425 s.f. Hospital Expansion 132,570 82,925 Medical Office Buildings 62,240 124,500 (2 bldgs.) Oncology Center (not in original plan) -- Parking Onsite 103 spaces 283 spaces Parking Garage/Deck 775 spaces 625 spaces FINANCIAL BENEFITS FROM EXPANSION UNDER THE ORIGINAL OPA The hospital and related staff office facilities do not produce property tax revenues due to Scripps' status as a non-profit hospital. However, under the original plan, it was provided that the proposed medical office buildings 'Existing hasp.a! is 105,050 sJ, and 159 beds. There are currentiy 64 parking spaces attributed to the existing hospital. 4-'1 .. .. - Page 5. Item -4 Meeting Date 10/21/97 (together with the portion of the parking garage attributable to those buildings) would generate property tax revenue. In order to ensure this, in the event that these facilities either: i) were not built, ii) were built but were declared tax exempt by the County Assessor, or iii) were built but were assigned a valuation lower than anticipated, Scripps is presently required to pay the Agency an "in.lieu" tax in an amount equal to the property tax revenues originally projected to be generated from these facilities. In accordance with the formula in Schedule C of the original OPA, in.lieu payments totalling $92,000 annually were to be made by Scripps in the event that the Phase I medical office building was not constructed by July 1995. If constructed and valuated lower than projected, Scripps would have to make up the difference. There was no in.lieu guarantee for sales tax revenues which were anticipated from pharmacy/gift shop sales. In-lieu payments for the Phase I office building were to increase by 2% annually from August 1, 1992. The Agency would, under the original agreement, also be eligible to receive in-lieu payments for failure to construct the Phase II medical office building and parking garage if these facilities were not completed by the end of July 1998. The values of these facilities were estimated at $9.2 and $5.6 million, respectively, and were also subject to the 2% annual escalator from August 31, 1992. Based upon the requirements stated above, staff has requested remittance of in.lieu fees from Scripps for 1995 and 1996 totalling $113,193, without regard to taxes actually paid. FINANCIAL BENEFITS FROM EXPANSION UNDER THE PROPOSED AMENDED OPA Under terms first submitted by Scripps for the revised plan, the hospital and related office space would not have produced property tax revenues. The oncology center in Phase I and two medical office buildings in Phase II would not have been taxable. However, with the exception of the oncology center and first 62,000 sq. ft. office building, Scripps would not have been obligated to make "in lieu" payments in the event that the tax generating expansion facilities were not built. Further, the revised plan provided no "in lieu" payments in the event these facilities were built but were granted a tax exemption by the Assessor or were assigned a lower than anticipated valuation. Additionally, under Scripps' proposed revisions, the hospital could have avoided its "in lieu" obligation with respect to the medical office building by acquiring the existing medical office building located at 480 Fourth Avenue which is adjacent to, but outside of the redevelopment site. Although this purchase, which has in fact already occurred, has increased City property tax revenues, since it is outside of the redevelopment area, the City will only receive its normal share of taxes through the County estimated in excess of $16,000 annually. A side-by-side comparison of the financial benefits to be derived by the Agency and City from the original and revised expansion plan, assuminQ complete build out, as well as the benefits which would have accrued absent redevelopment, is presented below. Sales tax revenues are considered as a constant under both hospital expansion plans, since they would be derived from gift/flower shop and pharmacy sales. 4..~ - .. -. Page 6, Item i- Meeting Date 10/21/97 COMPARISON OF TAX REVENUES ORIGINAL PROJECT REVISED PROJECT BEFORE SITE CLEARANCE PHASE I PHASE II PHASE I PHASE II Property tax increments $1,200' $102,0003 $219,300' $52,0005 $182.4006 Sales Tax $39,624 $31,500' $31,500 $31,500 $31,500 Total Revenue $40,824 $133,500 $250,800 $83,500 $203,900 Aoencv Authorized Business Terms for the Amended OPA Following staff discussions with Scripps' consultants late in 1996, business terms were negotiated which provided better financial benefits to the City/Agency. Staff recommended and the Agency authorized incorporation of these terms and conditions into the amended OPA at the meeting of January 7, 1997 (A-113 included as Exhibit C). In. Lieu Pavments Owed to Citv Concerning in-lieu payments currently due to the City (item 1 above), staff calculated a net amount of $72,000 currently owed to the City. This amount took into consideration property taxes paid by Scripps since their acquisition of the site in 1993. Verified payments totalling $41,000 were deducted from the $113,000 owed tot he Agency to arrive at a net amount of $72,000. In further discussing the calculations with Scripps' consultants, it was indicated that Scripps' concept of taxes paid included property base taxes paid to all entities ( not just tax increments paid to the Agency). This is estimated at $65,000 from the date of acquisition to the end of 1996 which would arguably reduce the amount owed to $7,000. In addition, Scripps consultants argued that the City received business and sales tax revenues from businesses which remained on the site much longer than anticipated (Express Gas and Arby's continue to operate on the site). In subsequent discussions between 'This area was included in redevelopment in 1988. City still shares in $32,000 base year taxes. '$92.000 per Section 1Idl of Attachment 12 of the DDA Isee Exhibit CI and $10,900 in property tax increments. 'Additional 60,000 s.l. office building and parkin9 garage @ 60% of cost. Also includes 2% annual escalator since August 31, 1992. 'Oncology Center, $2.6 million (Scripps' estimatel and $10,000 in property tax increments; $16,000 in property tax increments. 'Two 62,000 s.t. office buildings @ $130 s.t.; $16,000 in property tax increment. No escalators. 'Based on Scripps' estimate for pharmacy/flower shop sales. p..{. Page 7. Item 4 Meeting Date 10/21/97 City staff and Scripps consultants, the latter agreed that Scripps would pay the Agency $40,000 as an appropriate compromise. This has been approved by Scripps and is recommended by City staff. In-lieu Pavments Under the Amended OPA Concerning in.lieu payments for the one half of the land value, the oncology center and medical office buildings, Scripps has agreed to the following: 8 Beginning January 1, 1997, if the Agency receives less in annual property tax revenues from the site (including possessory interest taxes) than the guaranteed base amount of $16,320, Scripps will pay the Agency the difference between the annual property tax revenues received by the Agency and the guaranteed base amount. This amount will increase by 2% annually. 8 Beginning July 1, 1999, if the Agency receives less in annual property tax revenues from the site (including possessory interest taxes) than the sum of the guaranteed base amount (as described above) and the guaranteed tax increment for the oncology center (initially, $36,000), then Scripps will pay the Agency the difference between the annual property tax revenues received by the Agency and the sum of the guaranteed base amount and the guaranteed tax increment for the oncology center. The base amount for the oncology center will increase by 2% annually. If the assessed valuation of the oncology center is higher than anticipated, and the property remains on the tax roles, the Agency will receive the higher tax increment. However, if the property is taken off of the tax roles, the Agency will only be guaranteed the Base amount of $36,000 plus the annual increase. 8 Beginning July 1, 2003, if the Agency receives less in annual property tax revenues from the site (including possessory interest taxes) than the sum of the guaranteed base amount (as described above), the guaranteed tax increment for the oncology center (as described above) and the guaranteed tax increment for the first medical office building (initially, $80,000), then Scripps will pay the Agency the difference between the annual property tax revenues received by the Agency and the sum of the guaranteed base amount, the guaranteed tax increment for the oncology center and the guaranteed tax increment for the first medical office building. The base amount for the office building will be $80,000, increasing by 2% annually. If the office building has a higher valuation and remains on the tax roles, the Agency will receive the high amount. If the property is exempted from taxes, the Agency will still receive the higher amount, but that amount will not receive an automatic 2% increase. 8 Beginning July 1. 2005, if the Agency receives less in annual property tax revenues from the site (including possessory interest taxes) than the sum of the guaranteed base amount (as described above), the guaranteed tax increment for the oncology center (as described above), the guaranteed tax increment for the first medical office building (as described above) and the guaranteed tax increment for the second medical office building (initially, $80,000), then Scripps will pay the Agency the difference between the annual property tax revenues received by the Agency and the sum of the guaranteed base amount, the guaranteed tax increment for the oncology center, the guaranteed tax increment for the first medical office ;building and the guaranteed tax increment for the second medical office building. If the building has a higher valuation and'remains on the tax roles, the Agency will receive the higher amount in taxes. /1-7 ( - . - - Page B. Item I{ Meeting Date 10/21197 If the building is declared tax exempt, the Agency will receive the guaranteed base or highest valuation, whichever is higher. If the Agency receives the highest valuation, the 2% escalator will not apply. All in-lieu payments shall be made in arrears commencing on July 1 following (and calculated back to) the applicable calculation dates described above through July 1, 2028 (expiration of the Redevelopment Plan). Use of Site for Health and Related Services Scripps has agreed to devote the entire site to medical uses including medical services such as the oncology center, cancer diagnostic and treatment center, together with health related activities until 2014. Health related activities include skilled nursing and intermediate care facilities, hospices, medical offices, outpatient surgery centers, clinics, health maintenance organization offices, pharmacies, gift shops, restaurants and other commercial uses compatible and complimentary to hospitals and related medical facilities. CON ClUSIONS/RECOMMEN OA TIONS Although tax payments in the initial years are considerably less than anticipated under the original OPA, the project as conceived in 1991 is not practical and will not be developed today. Since approval of the original project there have been substantial changes in the medical services industry. In order to remain profitable and effective in this new environment, Scripps has had to rethink their expansion plans and the result has been a reduction in the size of the proposed facilities. Should needs change in the future, as they well may, Scripps will have a campus in Chula Vista which can accommodate additional expansion. The presence of Scripps health related facilities is an important anchor to the City's growing medical services industry which is particularly strong in the downtown area. Alternative development proposals which were analyzed for this site in 1991 appeared to provide greater tax revenues. However, since that time, both Walmart and the UH" Street Price/Costco centers have been developed. The viable and youth serving businesses formally located on this site have been successfully relocated. In conclusion, staff recommends the approval of the amended and restated OPA for expansion of Scripps Hospital and related facilities as in the best interests of the long term development of the City. FISCAL IMPACT: Before redevelopment of the northeast corner of Fifth Avenue and "H" Street, combined property and sales taxes accruing from the site were estimated at $41,000. The original plans for expansion of the hospital would have provided an estimated $133,500 annually to the Agency/City after build out of Phase I (1995), and an estimated $250,000 annually after completion of Phase II (1998) based upon construction cost estimates provided by Scripps (see chart on page 6). Pursuant to the provisions for in-lieu payments in the original OPA which guaranteed that the Agency would receive its share of these revenues, Scripps currently owes the Agency $113,000. Credit for taxes revenues paid since acquisition of the property by Scripps reduces this amount to $72,000. In consideration of additional tax payments made 4..9 - . -- Page 9. Item .-!L Meeting Date 10/21/97 by Scripps and their tenants from the date of acquisition, Scripps has requested a compromise payment be made to the Agency totalling $40,000. Under the amended and restated OPA as presented to the Agency, recommended by staff and approved by Scripps, the Agency/City will be guaranteed the following amounts; FY 97/98 $12,240 (75% of the guaranteed base of $16,320) FY 98/99 $16,646 FY 99/00 $52,979 (Completion of Phase I oncology center) FY 00/01 $54,039 FY 01/02 $55,120 FY 02/03 $56,222 FY 03/04 $137,347 FY 04/05 $140,093 FY 05/06 $222,895 (Completion of Phase II medical office buildings) The final amount above will increase by 2% every year thereafter. If evaluation of development exceeds the anticipated amounts and the development remains on the tax roles, the sums above may be higher. In addition, the City will receive any sales and utility user taxes accruing from the development. EXHIBITS A- letter of Approval from the ORC B - Revised Project Plans C - 01107/97 Agency Staff Report and Minutes 0 - Original and Current Site Plans E. Amended and Restated Owner Participation Agreement IFK! H:IHOME\COMMOEV\STAFF.REP\10,O7.97ISCRIPPS,OPAIOct,be, 16, 199713:50pmll 4 - e¡ RESOLUTION NO. /b-r. '- RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA ADOPTING AN EIR ADDENDUM 90-07A AND APPROVING AN AMENDED AND RESTATED OWNER PARTICIPATION AGREEMENT BY AND BETWEEN THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA AND SCRIPPS HEALTH FOR THE EXPANSION OF HOSPITAL AND RELATED FACILITIES AT THE NORTHEAST CORNER OF "H" STREET AND FIFTH AVENUE WHEREAS, on November 7, 1991, the Agency approved an Owner Participation Agreement (OPA) with Scripps Memorial Hospital (now Scripps Health) for expansion of their hospital located on an B.9 acre site located within the Town Centre II Redevelopment Project Area at the northeast corner of "H" Street and Fifth Avenue to inciude additional bed capacity, two medical office buildings and a parking garage; and WHEREAS, due to changes in the medical services industry resulting in substantial downsizing of their expansion plans, revised expansions were submitted to, reviewed and recommended for approval by the Design Review Committee; and WHEREAS, in February 1996, Scripps submitted a restated OPA incorporating their new expansion pial1s to City staff; and WHEREAS, Scripps and City staff negotiated mutually acceptable business terms; and WHEREAS, on January 7, 1997, the Agency approved in concept an agreement with Scripps for the amendment of the OPA; and WHEREAS, staff and Scripps subsequently prepared a formal OPA amendment to implement the agreement, making certain clarifications thereto; and WHEREAS, a public hearing was duly noticed for October 7, properly continued until October 21, and conducted on October 21, at which public testimony was taken and considered by the Agency; and WHEREAS, the project contemplated by the amended OPA is consistent with the Town Centre II Redevelopment Pian and wiil assist in the elimination of blight within that Project Area; and WHEREAS, minor technical changes were made in the project design since the certification of EIR 90-07 necessitated an addendum thereto which has been prepared in accordance with CEQA. NOW, THEREFORE, BE IT RESOLVED the Redevelopment Agency of the City of Chula Vista does hereby (1) adopt the EIR Addendum 90-07 A; (2) approve the amended and restated Owner Participation Agreement with Scripps Hea!th in substantialiy the form presented, with such minor modifications as may be approved by the City Attorney; (3) authorize the Chairman to execute same; and (4) authorize staff to take any and all additional steps reasonable or necessary to implement the terms of same. Presented by Approved as to form by Chris ~, ~ ~ Director of Community Development IIMDI H,\HDMEICOMMDEV\RESDS\SCRIPPS ID""" 16, 1997 ",'9pml! 4-/0 ~\\It-. Î / Ó IT, A ::-.. § EXHIBIT A Cl1Y Of 'CDMMI!NlT\";"'r.^.~-- g ,~~~L~;;~~" r-:;:~li July 26, 1995 ~ i . I Scripps Health f Attn: Tom Gammiere $35 "E" Street Chula Vista, C~ 91910 Subject: DRC-95~46 Dear Þ.pplicant: On July 24, 1995, the Design Review Committee consiåereå thE Remoåe1 anå Expansion proposal for the Scripps Hospital ~ocatEd locateå at 435 "E" Street within the Town Centre! reåevilopmenL 1'.rea. The Committee, after hearing staff's presentation Ene applicant's testimony, approvEå the projEct by unanimous votE and is forwarding a positive recommEndation to the Reåevelopment Agency suggesting that the following conditions be adopteå for this proj ect: a. 1'- conåitional use permit shall be obtained for all Existing ariå/or proposed temporary strùctures. b. Off-site parking. facility shall be upgraåeå to meEt current site design stanåa~ås (lanåscaping, paving, :o:1i¡-.g ..;all, parking scrE:Enir,g, EtC.). c. An encroachment permit shall be obtained to justify the first phase Encroachment of parking onto the public right-of-way. d. Deleted E. Existing roof mounted equipment shall bE screeneå with compatible .ffiat:ei'ials anå finish treatment. f. A comprehensive sign program shall be submitteå to stat: for final review.anå approval. g. Aåditional l~nåscape treatmentshàll be proviåeå along the easterl~ Eåge o~ the prbject site, aåjacent to the apartment .compIEx, .. h. Existing lanåscaped areas and meåians on ~E" Street shall be adåresseå in the formal lanåscape anå' irrigation ,J:;' plans. i. 1'.11 Exterior lanås!:apE noåES within the parking 10t'5 shall havE a minimum wiåth åimEnsion of 6 fEet. A-( 276 F-:JURTHAVENUE . CHULA VISTA. CALIFORNIA. 91910 . ('-'91 ,;'.:101 - - . - < j., The tree ~ell cutoutS at the "H" Street and Fifth Avenue intersect~on shall incorporate tree srates. K. A parking Screening soiution alo~g "E" Street shall be incorporated as part of the landscaping program. - 1. The site master plan is, approved 2.S shown in the plans submitted by James A. Leary Architecture and Planning dated June 9/ 1995. m. 1". pedestrian sidewalk connecting the hoSpital main entrance with "H" Street siåewalk shall be installed along the east side of the central driveway. n. An effort shall be made to extend the colonade and it's design components of the spinal pedestrian walk as far west as Possible. Failure to present the development proposal to the Redevelopment 1".gency for final action within one year from the date of this letter shall cause the approval and endorsement of this project to become null and void unless a written reGuest for an extension is recel.vo:d and granted by the Design Revie"w Committee prior to Lho: expiratior'. date. If you have any questions in regards to this matter, please call me at E9l-S090. SÜ.cerely, ,-- Or I Associate Planner cc: James 1".. Leary 1".IA, 9845 Erma Road, Suite 205A, San Diego, CÞ. 92131 -' J .- , ,L" /I-~ CITY OF CHUlA VISTA -- - o. I f EXHIBIT B I I ADDENDUM TO ENVIRONMENTAL IMPACT REPORT EIR-90-07A Scripps Memorial Hospital Expansion PROJECT NAME: Scripps Memorial Hospital Expansion Amendments PROJECT LOCATION; Northeast comer of Fifth Avenue and H Street PROJECT APPLICANT; Scripps Memorial Hospital CASE NO,; EIR-90-07 A I. INTRODUCTION The environmental review procedures of the City of Chula Vista allow the Environmental Review Coordinator (ERC) to prepare an addendum to an Environmental Impact Report, if one of the following conditions is present: 1. The minor changes in the project design which have occurred since completion of the Final EIR have not created any new significant environmental impacts not previously addressed in the Final EIR; 2. Additional or refined information available since completion of the Final EIR regarding the potential environmental impact of the project, or regarding the measures or alternatives available to mitigate potential environmental effects of the project, does not show that the project will have one or more significant impacts which were not previously addressed in the Final EIR. Additionally, Section 15162 of the CEQA Guidelines describe conditions that call for preparation of a subsequent EIR. None of those conditions exist with respect to the proposed action, as evidenced by the following. The project involves reduction in total building area of an approved expansion analyzed in EIR 90-07. An Environmental Impact Report was prepared for the expansion of Scripps Memorial Hospital which contemplated expansion from 159 beds to 258 beds contained within 834,144 total square feet of building area. The proposed modification to the expansion would result in a facility with a total of 230 beds within 570,975 square feet. The project represents a reduction of 28 beds and 263,169 square feet of building area as compared to what was previously analyzed in EIR 90- 07. The significance of environmental impacts identified in EIR-90-07 would be less than those anticipated with implementation of the proposed modifications. /!J-' No substantial changes with respect to the circumstances with which the project is undertaken would occur with the proposed reductions. Additionally, no new mitigation measures or project alternatives exist at this time that would be considered significantly different from those analyzed in the previously certified EIR. Therefore, in accordance with Section 15164 of the CEQA Guidelines, as amended, the City has prepared the following Addendum to the Final EIR for the Scripps Memorial Hospital Expansion EIR-90-07A. A. PROJECT SETTING The approximately 13.5 acre project site is located on the northeastern comer of Fifth Avenue and H Street in the City of Chula Vista. An existing 159 bed hospital facility occupies the site. B. PROJECT DESCRIPTION The project proposes to modify expansion plans for the hospital to reduce the total approved capacity of the ultimate facility from 258 beds to 230 beds, with a corresponding reduction in proposed building are from 834,144 to 570,975 square feet. C. IDENTIFICATION OF POTENTIAL ENVIRONMENTAL EFFECTS The project does not represent a change in the level of significance or the quality of any of the environmental impacts documented in the previously certified EIR-90-07, and may reduce the severity of some impacts due to the reduction in size and capacity of the facility. No changes in environmental conditions or in the feasibility of any mitigation measures or project alternatives have occurred since the certification of EIR-90-07 that would result in any environmental impacts upon implementation of the proposed project. -2- ß-:J. D. CONCLUSION No new significant environmental effects would result from implementation of the project as proposed based on the inability of the action to have any such effects. No additional mitigation is required beyond that specified in the previously certified EIR-90-07. Pursuant to Section 15164 of the State CEQA Guidelines and based upon the above discussion, I hereby find that the project revisions to the proposed project will result in only minor technical changes or additions which are necessary to make the Final EIR adequate under CEQA. ~ ~----, E ONMENTAL REVIEW COORDINATOR REFERENCES Final EIR ,Scripps Memorial Hospital Expansion General Plan, City of Chula Vista Title 19, Chula Vista Municipal Code City of Chula Vista Environmental Review Procedures -3- 13-.3 EXHIBIT C REDEVELOPMENT AGENCY AGENDA STATEMENT Item ....L Meeting Date 01/07/97 ITEM TITLE: Report Proposed changes to the Owner Participation Agreement with Scripps Health for the Expansion of Hospital Facilities SUBMITTED BY: Community Development Director REVIEWED BY: Executive Directv (4/5ths Vote: Yes- No..!...) BACKGROUND: The Agency approved an Owner Participation Agreement (OPA) with Scripps Memorial Hospital (now known as Scripps Health) on November 1, 1991 for expansion of their hospital located on H Street to include additional bed capacity, two new medical office buildings and a parking garage. The expansion was to take place on an 8.9 acre parcel located at the northeast corner of Fifth Avenue and H Street, within the Town Centre II Redevelopment Project Area. Early in 1995, Scripps staff informed City staff that plans for redevelopment of the site would be altered due to changes in the medical services industry which would result in substantial downsizing of their expansion plans. Later that year, revised plans were submitted, reviewed by staff and recommended for approval by the Design Review Committee. In February 1996, Scripps submitted proposed revisions to the OrA incorporating their new plans. Processing of the new hospital expansion plans through the State regulatory agencies is awaiting Agency approval of revisions to the orA City staff has reviewed the revisions to the orA and met with Scripps consultants to further discuss the changes in their expansion plans which substantially reduce anticipated revenues to the Agency. City and Scripps staff have reached mutual agreement on terms for inclusion in an amended orA which will best address the financial impact from the downsizing. These terms are presented to the Agency for review and comment. If deemed acceptable, they will be included in an amendment to the orA RECOMMENDATION: That the Agency review the financial terms for the proposed changes in the Scripps Hospital expansion plans and direct staff to bring back an amendment to the orA which embodies the terms as described below: The Agency will collect in lieu payments curreñtly due to the City under the OrA from Scripps' failure to develop on the site. Scripps will receive credit for all verified property tax increments paid from land and improvements on the redevelopment site towards the amount due. Require continued payment of tax increments accruing from Scripps purchase of the property for approximately half of the site as contemplated under the existing orA in an amount not less than $16,000 annually. Scripps will make annual in lieu payments totalling $36,000 for the proposed oncology center if not constructed by June 30, 1999. This payment will increase by 2% yearly from that date. I{ t! - f I ' - .. . - Page 2, Item ~ Meeting Date 01/07/97 Scripps will make annual in lieu payments for first medical office building proposed under the revised plans if not constructed by June 30, 2003 in the amount of $80,000. This amount will increase by 2% yearly from that date. The first medical office building will be located per approved site plans on the corner of H Street and Fifth Avenue. The second medical office building will be located between the oncology center and hospital expansion. If the second office building is not constructed by June 30, 2005, Scripps will make in-lieu payments in the amount of $80,000. This amount will increase by 2% yearly from that date. Scripps will guarantee that the redevelopment site will be devoted to medical services use until 2014. In lieu payments shall cease upon expiration of the Redevelopment Plan (2028), BOARDS/COMMISSIONS RECOMMENDATION: The Redevelopment Agency and City Council, in a joint meeting on November 1, 1991, approved a Conditional Use Permit and Special Permit for the original hospital expansion proposal. The Agency and City also authorized the condemnation of real property and conveyance to Scripps without competitive bidding. Finally, at that same meeting, the Agency and Council approved an OPA with the developer. Because of the size of the agenda package for this meeting, it has not been included but is available for review at the Community Development Department. On July 24, 1995, the Design Review Committee (DRC) reviewed and conditionally approved the revised expansion plans for the hospital and related facilities. The letter of approval from the DRC to the developer is attached as Exhibit A. The revised plans will be presented to the Agency for final approval with the revisions to the OPA. The Town Centre I Project Area Committee which serves as the Project Area's Committee for the Town Centre II Project Area does not presently have enough members to make a quorum and, consequently, has not reviewed this item. DISCUSSION: Site Utilization - Comparison of Oriainal and Revised Plans' The original and current site plans for the hospital expansion at the northeast corner of Fifth Avenue and H Street are attached for comparative purposes as Exhibit B. The original plans included the expansion of hospital facilities to accommodate 100 additional beds, updated emergency treatment facilities, two medical office buildings and a parking garage. The original project was to be phased with one medical office building comprising approximately 63,000 square feet and hospital expansion comprising 120,000 square feet occurring in Phase 1. The medical office building was to have been completed by mid-1995. The phase I hospital expansion should have been completed this year. C-d-. .4 'J- - - .. - Page 3, Item ....!... Meeting Date 01/07/97 Phase II of the original proposal was to consist of a second medical office building (62,000 square feet), additional hospital office expansion of approximately 133,000 square feet, and a sizeable parking garage. Since approval of the expansion project in 1992, substantial changes have occurred in the medical services industry. These changes were promulgated by efforts by the Federal government to control costs, the proliferation and consolidation of health maintenance organizations and the consequential changes in health delivery systems to become more efficient and cost effective. This has resulted, in part, in a reduction in the need for in-patient hospital facilities as illustrated by the number of hospitals which have recently closed or have been acquired and consolidated. In order to stay competitive and profitable, Scripps has had to re-think plans for expansion of its Chula Vista campus which resulted in the decision to downsize expansion and reoriented priorities. The revised plans substantially reduce Phase 1 development on the site to a 13,000 square foot oncology center (not proposed in the original plans) in what was to be the location of the parking garage and a scaled back, 34,000 square foot (twenty-four bed) hospital expansion which includes upgrading of emergency room facilities. The remainder of the site in Phase I is devoted to surface parking and landscaping, with the exception of the Redi-Care and First Interstate Bank (FIB) buildings which were to be demolished under the original plans, but now remain in place until Phase II is developed. The former users have been relocated and Scripps has taken over use of the buildings for additional office space. The oncology center would be developed immediately. Hospital expansion is subject to State review and would follow in about two years. The second revised phase includes a 60,000:t square foot medical office building on the present site of the Redi-Care and FIB buildings to be developed by 2003. If market conditions warrant, an additional medical office building will be constructed between the oncology center and the expanded hospital. If the additional office buildings are constructed in Phase II, a parking deck will be added, A side-by-side comparison of the improvements to be constructed under the original and revised expansion plans, assuminQ complete buildout. is presented below. COMPARISON OF PHASE I SQUARE FEET ORIGINAL PLAN REVISED PLAN PHASE I 182,740 TOTAL S.F. 47,000 TOTAL S.F. Hospital Expansion 1 119,560 (99 béds) 34,100 (24 beds) Medical Office Buildings 63,180 (1 bldg.) -- Oncology Center (not in original plan) 12,900 s.f. Parking Onsite 370 spaces 331 spaces Parking Garage/Deck N/A N/A 'Existing hospital is 105,050 sJ. and 159 beds. There are currently 64 parking spaces attributed to the existing hospital. C-3 r - . .. Page 4, Item ~ Meeting Date 01/07/97 COMPARISON OF PHASE II SQUARE FEET Phase II Original Plan Revised Plan Additional Development 194,810 s.f. 207,425 s.f. Hospital Expansion 132,570 82,925 Medical Office Buildings 62,240 124,500 (2 bldgs.) Oncology Center (not in original plan) - Parking Onsite 103 spaces 283 spaces Parking Garage/Deck 775 spaces 625 spaces Financial Benefits from Expansion and In Lieu Payments The hospital and related staff office facilities do not produce property tax revenues. However, under the original plan, it was provided that the proposed medical office buildings (together with the portion of the parking garage attributable to those buildings) would generate property tax revenue. In order to ensure this, in the event that these facilities either; i) were.JlQ1 built, Ii) were built but were declared tax exempt by the County Assessor, or Iii) were built but were assigned a valuation lower than anticipated, Scripps is presently required to pay the Agency an "in lieu" tax in an amount equal to the property tax revenues originally projected to be generated from these facilities (see Exhibit C - "In-lieu Tax Payment Schedule and Exhibit 0 - Schedule of Performance). In accordance with the formula in Schedule C of the OPA, in lieu payments totalling $92,000 annually are to be made by Scripps in the event that the Phase I medical office building was not constructed by July 1995. If constructed and valuated lower than projected, Scripps would have to make up the difference. There was no in lieu guarantee for sales tax revenues which were anticipated from pharmacy/gift shop sales. In lieu payments for the Phase I office building were to increase by 2% annually from August 1, 1992. The Agency will also be eligible to receive in lieu payments for failure to construct the Phase II medical office building and parking garage if these facilities are not completed by the end of July 1998. The values of these facilities were estimated at $9.2 and $5.6 million, respectively, and are also subject to the 2% annual escalator from August 31, 1992: However, in lieu payments for these facilities are prorated (see chart in Fiscal Impact section on page 9). Staff has recently requested remittance of in lieu fees from Scripps for 1995 and 1996 totalling $113,193 (Exhibit F). Note that the payment for 1995 is prorated since, pursuant to the formula for computation, the eligible period for in lieu payments in that year was only two months. Under terms first submitted by Scripps for the revised plan, the hospital and related office space do not produce property tax revenues. The oncology center in Phase I and the medical office buildings and related parking garage in Phase II would be taxable. However, with the exception of the oncology center and first 62,000 square foot office building, Scripps would not be obligated to make "in lieu" payments in the event that the tax generating expansion facilities were not built. Further, the revised plan provides no "in lieu" payments in the event these facilities were built but were (! -4 ry - . .- Page 5, Item ....!.-. Meeting Date 01/07/97 granted a tax exemption by the Assessor or were assigned a lower than anticipated valuation. Additionally, under Scripps' proposed revisions, the hospital may avoid its "in lieu" obligation with respect to the medical office building by acquiring the existing medical office building located at 480 Fourth Avenue which is adjacent to, but outside of the redevelopment site. Although this purchase may increase City property tax revenues, since it is outside of the redevelopment area, the City will only receive its normal share of taxes through the County. The purchase appears to be going through at this time and, in staffs opinion, is motivated by the need to consolidate access and parking for the hospital and is not directly related to the amendment of the OPA. While it is unlikely that Scripps will obtain tax exemptions for all improvements, it is to their advantage to apply for exemptions under the revised plan. A side-by-side comparison of the financial benefits to be derived by the Agency and City from the original and revised expansion plan, assuminq complete buildout. as well as the benefits which would have accrued absent redevelopment, is presented below. Sales tax revenues are considered as a constant under both hospital expansion plan, since they would be derived from gift/flower shop and pharmacy sales. COMPARISON OF TAX REVENUES ORIGINAL PROJECT REVISED PROJECT Before Site Clearance Phase I Phase II Phase I Phase II Property tax increments $1,2002 $102,000' $219,3004 $36,0005 $210,800. Sales Tax $39,624 $31,500' $31,500 $31,500 $31,500 Total Revenue $40,824 $133,500 $250,800 $67,500 $242,300 Under the original plan, the Agency was assured that it would receive these property tax revenues regardless of whether build out occurred. However, under the revised terms, Scripps was not obligated to make "in lieu" payments except with respect to the oncology center and first medical office building. Consequently, under the revised terms, total tax revenues could be as low as $158,100.. Furthermore, in the event that Scripps acquires the medical office building located at 480 Fourth Avenue, their requirement to construct the 62,000 square foot office building on site is satisfied. In that event, tax revenues from redevelopment could be as low as $67,500. 'This area was inciuded in redevelopment in 1988, City still shares in $32,000 base year taxes, , $92,000 per Section 1 (d) of Attachment 12 of the DDA (see Exhibit C) and $10,900 in property tax increments, . Additional 60,000 S,F. office building and parkin9 garage @ 60% of cost Also includes 2% annual escalator since August 31, 1992. , Oncology Center, $2.6 million (Scripps' estimate) and $10,000 in property tax increments, . Two 62,000 S,F. office buildings @ $130 sJ.; one parking garage @60%; $16,000 in property tax increment No escalators. , Based on Scripps' estimate for pharmacylflower shop sales. , Total of tax revenues from oncology center office building and related sites, and sales tax revenue, c.-~ ~ - - -- Page 6, Item -L Meeting Date 01/07/97 The graph attached as Exhibit E compares revenues from the site over time to illustrate the impact of the original and revised plans as well as the benefits which would have occurred absent redevelopment. Note that, even assuming full build-out under the revised plans, tax revenues generated from the site will not begin to approach revenues which the City and Agency would have received under the original plans until beyond 2005. In the interim period, as a result of the delay and downsizing of the project, the City and Agency have foregone over $1 Million in tax revenues that they were otherwise entitled te receive under the terms of the present CPA. By way of illustration of the shortfall, in accordance with the development schedule approved under the current CPA, the first medical office building should have been completed in July 1995 or "in lieu" payments would be required to be made to the Agency. Based on the formula, and assuming two tax years, the Agency is presently owed approximately $113,000 in tax increments (see Exhibit F). In addition, in lieu payments for the second medical office building, if not constructed, are to begin next year. Staff/Scripps Revised Proposal and Recommendations As illustrated on the chart on page 5, combined annual tax increment and sales tax revenues accruing from this site before Scripps' involvement were estimated at approximately $41,000. Under the original Phase I, annual revenues of approximately $133,500 were anticipated. The in lieu payment provisions guaranteed the Agency's receipt of $92,000 (plus land value increments) if the Phase I office building was not constructed by 1996, and an additional $92,000 if the Phase II office building was not constructed by 1998. These amounts each increase yearly by 2% after their first due dates. Under revised expansion plans, revenues from Phase I could reach $67,500, but there was no guarantee of increase beyond that. Total revenues to the Agency are substantially reduced under the revised expansion plans. This site originally contained ten businesses including Ardans, Rollerskateland, Fiesta Twin Cinema, Captain Kidd's, Farrells Ice Cream Parlor, Wherehouse Records, Redi-Care Clinic and FIB. Additionally, Arby's and Express Gas remain in operation and will eventually be relocated. Although the Scripps Hospital expansion project as currently proposed produces less revenue than originally anticipated, the project will provide many other benefits to the City including support for our local medical services industry, the provision of skilled and unskilled job opportunities, and draw many new people to this area, Going forward with the project also insures that the hospital will remain functional, unlike others in the region which have recently closed or consolidated. Additionally, Scripps has paid almost all of the costs associated with this project so far, including acquisition expenses (estimated in excess of $11 million) and the successful relocation of the youth serving businesses (Rollerskateland and Fiesta Twin Cinema) as required by the Agency. These businesses have been doing very well in their new locations. The only expenses to the Agency thus far have been legal consulting, staff, a relocation loan guarantee and relocation loan (guaranteed by Scripps) for $300,000, C-t. .¡-t;; - - .. Page 7, Item -L Meeting Date 01/07/97 Changes in the medical services industry which have forced Scripps to rethink their plans are outside of their control. However, their revised plans, particularly if limited to Phase I, appear to underutilize the site which has commercial potential. Redevelopment of this site was very controversial and required the disruption of ten businesses. The Agency supported Scripps' plans over competing proposals partly in consideration of the anticipated financial benefits which compared favorably with commercial redevelopment of the site, Unfortunately, circumstances have changed and the Agency must reconsider the benefits from this project In negotiating with Scripps, staff contended that the Agency and City should be guaranteed a reasonable flow of tax revenues from redevelopment Furthermore, since any development under the revised plan beyond Phase I is uncertain, the Agency should retain, through its right of reversion, the ability to take back parcels at the northeast corner which have not been redeveloped within a reasonable period of time. In response, Scripps indicated their willingness to pay in lieu fees in exchange for a reverter. Scripps also agreed to guarantee continued use of the site for medical services until 2014, and pay tax increments for the increased land value on the site as envisioned in the current CPA. Finally, Scripps requested that the Agency credit them for unanticipated property taxes accruing from the site since they purchased the property in 1993. The summary of the negotiated deal points appears below. 1. Scripps will pay in-lieu fees which are presently due under the CPA and estimated at $113,000. However, it is recommended that the Agency allow credit for tax increments accruing from the site since its purchase by Scripps early in 1993 estimated at approximately $40,000 per year. Some of this revenue was unanticipated since Scripps failed to take the property, including improvements which they are currently using for hospital business, off of the tax roles. In addition, the CPA allows credit for "post closing possessory tenants" for which Arby's and Express Gas and, arguably, the facilities which are being used by Scripps would qualify. Credit would be granted to Scripps upon verification of taxes paid which could exceed the total amount due under the in-lieu payment formula. It should also be noted that the City has continued to receive sales taxes from Arby's and Express Gas estimated at $32,000 annually. 2. Under the CPA, the site purchased by Scripps was to be divided into three parcels, The easterly half of the site was to be devoted to hospital expansion and be exempt from taxation. The westerly half of the site was to be divided into two approximately equal parcels. The corner of "H" and Fifth Avenue was to be the site of the taxable medical office buildings. The parking structure was to be constructed on the northerly quarter and would have been ultimately taxed at 60% since 40% of the use of the facility would have been attributed to the hospital expansion. Since purchase of the property in 1994, Scripps has not applied for removal of any portion of the site from the tax roles and the Agency has benefited by collecting an estimated and unanticipated $40,000 annually. Under the CPA, the Agency would have continued to collect approximately $16,000 annually from the taxable portions of the site, It is proposed, and Scripps agrees, that this provision remain in any revision of the CPA. C-Î ~ - - -- Page 8, Item ~ Meeting Date 01/07/97 3. Under Scripps proposal, they would be excused from making in lieu payments for failure to construct the first medical office building by the end of 2003 if they purchase the medical office building at 480 Fourth Avenue. This transaction appears to be occurring at this time. Although revenue from redevelopment of the site was not the prime consideration in selecting Scripps as redeveloper, it is an important consideration. Under the Scripps proposal, the Agency would have only been guaranteed tax increments from the oncology center and related land area (an estimated $36,000). This would not have compared favorably with the commercial redevelopment proposals submitted for this site. It was therefore considered reasonable for the Agency to require additional "failure to construct in- lieu" payments from the site. Scripps has agreed to make in-lieu payments for the oncology center if not constructed by June 30, 1999; the first medical office building if not constructed by June 30, 2003; and the second medical office building if not constructed by June 30, 2005. Each of these in-lieu payments will increase by 2% yearly from the date they are first due. In this manner, the Agency will be guaranteed minimum tax increments accruing from the site which will increase with predictability. 4. The northeast corner of Fifth avenue and "H" Street is presumed to have the greatest potential for commercial redevelopment. Under the current Scripps proposal, this will be the site of the first new medical office building, if constructed. The second medical office building is proposed to be constructed between the oncology center and the hospital expansion to the north of the corner site. This location appears to be a more appropriate location for the first medicai office building since it will provide greater development density and retain the corner site for possible commercial development if not needed for further medical use. Scripps staff has indicated that their board will be opposed to a reverter for the corner property since the hospital campus is already considered undersized for a major medical facility. Because of the expense and complex nature of the facilities which comprise a hospital campus, Scripps' planning must be flexible and long range. Any uncertainty concerning the future availability of the two acres on the corner may adversely impact their ability to respond to future needs. Furthermore, developing the first medical office building on this site first will require construction of a parking garage in Phase I (rather than Phase 11) and position the structure on or near the corner. Pis an alternative, Scripps proposed to retain the proposed location and phasing of the office buildings, with the first building constructed on the corner. The Agency would also drop the reverter. In exchange, Scripps agreed to make in lieu payments for the Phase II building as described above and provide an operating covenant to continue medical services use on the site until the year 2014. If the structure constructed exceeds that valuation, the Agency will receive greater revenues (tax increments). If the building is not constructed, or constructed and valued lower, Scripps will have to make up the difference through the in lieu payments. 5. In lieu payments will be required for the duration of the Town Center II Redevelopment Plan (2028). ~-g i{ y - - Page 9, Item ....!... Meeting Date 01/07/97 It is recommended that the Agency favorably consider these business points and provide direction to staff to prepare appropriate revisions to the CPA. Pursuant to State Community Redevelopment Law, any proposed changes to the CPA will require public notification and hearing before final consideration by the Agency. FISCAL IMPACT: Before redevelopment of the northeast corner of Fifth Avenue and H Street, combined property and sales taxes accruing from the site were estimated at $41,000 annually. The original plans for expansion of the hospital, construction of two medical office buildings and a parking garage would have provided an estimated $133,500 annually to the Agency/City in Phase I, and $250,800 in Phase II based upon construction cost estimates of the new facilities provided by Scripps. As a result of the Scripps' "in lieu" obligation under the present CPA, receipt of these estimated amounts by the City/Agency is essentially guaranteed. Pursuant to the CPA, in lieu payments totalling $92,000 were to be made by Scripps in the event that the Phase I medical office building was not constructed by July 1995. If constructed and valuated lower than projected, Scripps would have to make up the difference (see Exhibit C). The Agency would also receive tax increments from the portion of the site which was to remain on the tax roles totalling approximately $16,000. Thus, the Agency was guaranteed to receive no less than $108,000 annually if no Phase I improvements had been completed. There was no in lieu guarantee for sales tax revenues which were anticipated from pharmacy/gift shop sales. In lieu payments for the Phase I office building were to increase by 2% annually from August 1, 1992. The Agency will also be eligible to receive in lieu payments for failure to construct the Phase II medical office building and parking garage if these facilities are not completed July 1998. The values of these facilities were estimated at $9.2 and $5.6 million, respectively, and are also subject to the 2% annual escalator from August 31, 1992. However, in lieu payments for these facilities were prorated as follows: Medical Office Parking Garage Building July 1998 25% $4,317 15% $1,577 July 1999 50% $52,839 30% $19,298 July 2000 75% $80,845 45'Yo $29,526 July 2001 100% $109,949 60% $40,155 Based on this formula, in lieu payments accruing to the Agency in 1998 would have included $103,607 for Phase I, $5,894 for Phase II, and approximately $16,000 for land value; or a grand total of $125,501. This figure would increase to $193,816 in 1999. Staff has recently requested remittance of in lieu fees from Scripps for 1995 and 1996 totalling $113,193 (Exhibit F). Note that the payment for 1995 is prorated since, pursuant to the formula for computation, the eligible period for in lieu payments in that year was only two months. Proposed revisions by Scripps to the redevelopment plans have reduced Phase I estimates to $67,500 which is due to the reduced intensity and delay of development proposed for the site. The C-e¡ ~- j Page 10, Item -L Meeting Date 01/07/97 ultimate buildout of the project could produce as much as $242,300 annually. However, there was no guarantee that development beyond Phase I would occur and, as a result of the substantial reduction of Scripps' "in lieu" obligation under the proposed OPA revisions, revenues to be derived from the site under the revised plans may not substantially exceed $67,500. The Scripps/City staff negotiated proposal would; 1. Offset in lieu payments due by verified tax increments paid to the Agency since 1993; 2. Construction of the first medical office building would be guaranteed by in-lieu payment of $80,000 if not constructed by June 30, 2003. This payment will be subject to a 2% escalator each year thereafter; 3. Construction of the second medical office building would be guaranteed by an in-lieu payment of $80,000 if not constructed by June 30, 2005. This payment will be subject to a 2% escalator each year thereafter; 4. Scripps will continue to pay tax increments or in lieu payments of at least $16,000 annually for land reevaluation; 5. Scripps will guarantee use of the site for medical services until 2014, 6. In lieu payments shall be due for the duration of the redevelopment program (2028). The chart attached as Exhibit E comparatively illustrates the project income accruing to the Agency from these different alternatives. ATTACHMENTS: Exhibit A: Letter of approval from DRC to Developer Exhibit B: Original & Revised Site Plans Exhibit C: In-Lieu Tax Payment Schedule Exhibit D: Schedule of Performance Exhibit E: Comparative Analysis of Annual Tax Revenues Exhibit F: Buser Letter dated 1215/96 (fl<) M:IHOME\COMMOEV\STAFF.REP\11-19-9"'";pp,,dda (O""mb" 23, 1996 (3"Opm)] c.-fO "1- / 7J - . .,- Minutes January 7, 1997 Page 5 ORAL COMMUNICATIONS None. ACTION ITEMS 4. REPORT: PROPOSED CHANGES TO THE OWNER PARTICIPATION AGREEMENT WITH SCRIPPS HEALTH FOR THE EXPANSION OF HOSPITAL FACILITIES--On 11/1191, the Agency approved an OPA with Scripps for expansion of their hospital located at the northeast comer of 5th Avenue and H Street within the Town Centre IT Redevelopment Project Area. In February 1996, Scripps submitted proposed revisions to the OP A which would result in substantial downsizing of their expansion plans. Staff requests the Agency review the financial impacts of the proposed changes and direct staff to bring back a proposal. (Community Development Director) Fred Kassman, Redevelopment Coordinator, reported that Scripps entered into an owner participation agreement with the Agency in 1991 and that agreement is currently in effect. As part of that agreement, a former Redevelopment Agency required Scripps to pay the full cost of the property acquisition and relocation of use serving facilities, which included Rollerskate Land and Fiesta Twin Cinema. The property settlement and acquisition occurred in 1993, and development of the first phase of the hospital expansion and the first medical office building should have occurred or been under construction by this time: however, since the early 1990s there have been significant changes in the medical services industry which are generally characterized by a downsizing and consolidation of facilities and a concentration on outpatient short-term care, as opposed to long-term hospital care. The Agency and Scripps have agreed on deal points which are conceptual in nature and will require a considerable amount of details to be worked out. If the conceptual deal points are approved by the Agency, they will function as direction to negotiators for City staff to continue to work with Scripps to refine the terms and develop the language for the revised owner participation agreement. Chris Salomone, Director of Community Development, indicated Scripps literally paid all of the fare of this project and the enormous legal costs. There were a number of businesses with leases there, and it was one of the most complicated redevelopment projects the City was involved with. . James Leery, 9845 Irma Road, San Diego, CA, architect representing Scripps, explained that health care industry is undergoing a revolution in San Diego, and the costs of health care are the heart of the issue. The difficulties it presents to a planner is the uncertainty of what the land use needs will be over the next 20 years. The combination of thai site with the existing site, less the amount they will give to the school, represents approximately 13 acres. If lhey build the first outpatient facility on the comer, they can still park the required cars on the surface of the site. If the first facility is moved to the rear, they will have to build i parking structure with that medical office building: Assuming they would leave the comer open for potential commercial or non-hospital use, a reversion would force them to probably invest an additional $5 million with that first element, which makes the whole project come apart financially. Senate Bill 1953 is asking hospitals to evaluate their seismic characteristics and certain components of existing hospitals may have to be replaced. Scripps needs the flexibility with the planning to deal with these kinds of things. MSUC (PadillalHorton) to accept staff's report. OTHER BUSINESS 5. DIRECTOR'S/CITY MANAGER'S REPORT<S): None. c.-If - . . . I EXHIBIT D - r~ ' ~' % '.1' ~ ã ¡!g ¡, , - - "3 "I : ~ ~ 2~ i ,'" a. ~u . ~ ~ §~ ~ ~ ~~ z - ~u a. a. ~ '" u 0 ~ z '~.l. (W , l (Q:) ~. 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I ~IHd¡1I ~,..""",..., , I " 1 2 3 4 5 6 7 AMENDED AND RESTATED OWNER PARTICIPATION AGREEMENT 8 REDEVELOPMENT AGENCY OF THE 9 CITY OF CHULA VISTA, CALIFORNIA 10 and 11 SCRIPPS HEALTH, a California non-profit public benefit corporation 12 13 14 15 , 199 - 16 17 . 18 19 20 21 22 TownCentre II Redevelopment Project 23 24 25 26 27 £-1 .-- 1 TABLE OF CONTENTS 2 Page 3 I. [§100] SUBJECT OF AGREEMENT 2 A. [§lOl] Purpose of this Agreement 2 4 B. [§102] The Redevelopment Plan 2, c. [§103] The Project Area 3 5 D. [§104] The Site 3 E. [§lOS] Parties to this Agreement 6 6 1. [§106] Agency 6 2. [§107] Participant 6 7 F. [§108] Conditions Precedent to Agency Acceptance and Execution of Prior Agreement. . . . . . .. 8 8 1. [§ 108] Satisfaction of Conditions Precedent 8 2. [§ 109] Agency Option. 9 9 3. [§ 110] Agency Reverter. 9 4. [§ 111] Site LOC 9 10 II. [§200] CONVEYANCE OF THE SITE TO PARTICIPANT 10 11 A. [§20l] Site Acquired and Conveyed to Participant 10 B. [§202] Indemnification of Agency. 10 12 1. Generally. 10 2. Exemptions 11 13 3. Expense Limitation 13 14 III. [§300] DEVELOPMENT OF THE SITE. 14 A. [§301] Development of the Site by Participant 14 15 1. [§302] Scope of Development; Relationship of . Ultimate Phase to Agreement. . . . . 14 16 2. [§303] Basic Concept Drawings 15 3. [§304] Construction Plans, Drawings and Related 17 Documents 15 4. [§30S] Agency Approval of Plans, Drawings and . 18 Related Documents 16 5. [§306] Cost of Construction 18 19 6. [§307] Construction Schedule 20 7. [§307A] Delivery of Evidence of Equity Capital 20 and Mortgage Financing Commitments 20 8. [§308] Insurance and Indemnification. 22 21 9. [§309] Delivery of Evidence of Submission and Approval by State of Plans for Expansion 22 Hospital Facility; City and Other Governmental Agency Permits 23 23 10. [§310] Rights of Access 24 11. [§311] Local, State and Federal Laws 25 24 12. [§312] Anti-Disorimination During Construction. 25 13. [§313] Consummation of Certain Relocation 25 Agreements 25 B. [§314] Parcel Map 26 26 c. [§3l5] Taxes, Assessments, Encumbrances and Liens 28 D. [§316] Prohibition Against Transfer of Site, the 27 Buildings or Structures Thereon and Assignment of Agreement. . . . . . 29 -i- £'-~ . 1 E. [§317] Security Financing; Rights of Holders 31 1. [§318] Use of Financing 31 2 2. [§319] Holder Not Obligated to Construct Improvements 31 3 3. [§320] Notice of Default to Mortgage, Deed of Trust or Other Security Interest Holders; 4 Right to Cure 32 4. [§321] Failure of Holder to Complete 5 Improvements 33 5. [§322] Right of Agency to Cure Mortgage, Deed of 6 Trust or Other Security Interest Default 35 F. [§323] Right of Agency to Satisfy Other Liens on the 7 Site After Title Passes 35 G. [§324] Certificate of Completion. 36 8 IV. [§400] COVENANTS PERTAINING TO THE SITE 40 9 A. [§401] Uses 40 B. [§402] Maintenance 41 10 C. [§403] Obligation to Refrain from Discrimination. 44 D. [§404] Form of Nondiscrimination and Non-Segregation 11 Clauses 44 E. [§405] Obligation to Make Payments in Lieu of 12 Property Taxes 47 F. [§406] Waiver of Right to Protest Formation of 13 District .....,......... 50 G. [§407] Effect and Duration of Covenants 51 14 H. [§408] Rights of Access - Public Improvements and Facilities 52 15 V. [§500] DEFAULTS, REMEDIES AND TERMINATION 53 16 A. [§501] Defaults - General 53 B. [§502] Legal Actions 54 17 1. [§503] Institution of Legal Actions 54 2. [§504] Applicable Law 55 18 3. [§505] Acceptance of Service of Process 55 C. [§506] Rights and Remedies.are Cumulative 56 19 D. [§507] Mutual Release 56 2. [§509] Release of Participant 58 20 3. [§510] No Assignment 59 21 VI. [§600] GENERAL PROVISIONS 60 A. [§601] Notices of Demands and Communications Between 22 the Parties 60 B. [§602] Conflicts of Interest 61 23 C. [§603] Non-Liability of Agency Officials and Employees .'. 62 24 D. [§604] Enforced Delay: Extension of Times of Performance 62 25 E. [§605] Inspection of Books and Records 63 F. [§606] Plans and Data 64 26 G. [§607] Reference 64 H. [§608] Indemnities 69 27 I. [§609] Attorneys' Fees 69 -ii- £-3 1 VII. [§700] SPECIAL PROVISIONS 69 A. [§701] Amendment of Redevelopment Plan. 69 2 B. [§702] Amendments to this Agreement 70 C. [§703] Implementation Agreements 70 3 VIII. [§800] ENTIRE AGREEMENT, WAIVER AND AMENDMENTS 71 4 IX. [§900] TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY 71 5 ATTACHMENT NO. 1 TownCentre II Project Area Map 6 ATTACHMENT NO. 2 Site Map ATTACHMENT NO. 3 Legal Description of Site 7 ATTACHMENT NO. 4 Scope of Development ATTACHMENT NO. 5 Schedule of Performance 8 ATTACHMENT NO. 6 In-Lieu Tax Payment Schedule ATTACHMENT NO. 7 Certificate of Completion 9 10 11 12 13 14 15 16 17 , 18 19 20 21 22 23 24 25 26 27 -i)!--ý - - . 1 AMENDED AND RESTATED 2 OWNER PARTICIPATION AGREEMENT 3 4 THIS AMENDED AND RESTATED OWNER PARTICIPATION AGREEMENT 5 is entered into as of the - day of , 199 - (the 6 "Execution Date"), by and between the REDEVELOPMENT AGENCY OF THE 7 CITY OF CHULA VISTA, CALIFORNIA ("Agency") and SCRIPPS HEALTH, a 8 California non-profit public benefit corporation ("Participant"), 9 with reference to the following facts: 10 11 A. Agency and Participant (under its former name of 12 Scripps Memorial Hospitals) entered into the Owner Participation 13 Agreement dated November 7, 1991, as modified by the First 14 Addendum to the Owner Participation Agreement (collectively, the 15 "Prior Agreement"): 16 17 B. Agency and Participant now wish to make certain ; 18 amendments to the Prior Agreement, and incorporate them into this 19 Amended and Restated Owner Participation Agreement ("this 20 Agreement"). Agency and Participant intend that this Agreement 21 shall completely supersede the Prior Agreement, which will be of 22 no further force or effect. 23 24 NOW, THEREFORE, in consideration of the mutual 25 covenants and conditions hereinafter set forth, Agency and 26 Participant agree as follows: 27 RBK\AGM1\141931.8 £-,"" 10/09/97 11.07am 1 1. [§lOO] SUBJECT OF AGREEMENT 2 3 A. [§lOl] Purpose of this Aqreement 4 5 This Agreement amends and restates the Prior Agreement 6 and completely supersedes the Prior Agreement, which shall be of 7 no further force or effect. 8 9 The purpose of this Agreement is to effectuate the 10 Redevelopment Plan for the TownCentre II Redevelopment Project 11 (the "Project") by providing or the development of certain real 12 property (the "Site") included within the boundaries of the 13 Project (the "Project Area") and to insure the provision of 14 adeqùate medical facilities to service the residents of the City 15 of Chula Vista. . 16 17 The development of the Site pursuant to this Agreement . 18 and the fulfillment generally of this Agreement are in the vital 19 and best interests of the City of Chula Vista, California (the 20 "City"), and the health, safety, morals and welfare of its 21 residents, and in accord with the public purposes and provisions 22 of applicable federal, state and local laws and requirements. 23 24 B. [§102] The Redevelopment Plan 25 26 This Agreement is subject to the provisions of the 27 Redevelopment Plan for the Project, which was approved and RBK\AGMTl141931.8 -2 - £-(. 10/09/97 1 ¡,Q7am 1 adopted on August 15, 1978, by the City Council of the City of 2 Chula Vista by ordinance No. 1827 and amended on May 19, 1987, by 3 Ordinance No. 2207 and on July 12, 1988 by Ordinance No. 2274 4 (the "Redevelopment Plan"). The Redevelopment Plan, as it now 5 exists and as it may be subsequently amended pursuant to 6 Section 701, is incorporated herein by reference and made a part 7 hereof as though fully set forth herein. 8 9 C. [§103] The pro"iect Area 10 11 The Project Area is located in the City of Chula Vista, 12 California, and the exact boundaries thereof are specifically 13 described in the Redevelopment Plan. The boundaries approximate 14 those shown on the TownCentre II Project Area map attached hereto 15 and incorporated hérein as Attachment No. 1. 16 17 D. [§104] The Site . 18 19 The Site is that portion of the Project Area shown on 20 the Site Map (Attachment No. 2), and is more particularly 21 described in the Legal Description of the Site (Attachment 22 No. 3). The Site is comprised of approximately 8.9 acres of real 23 property presently owned by Participant. The Site is adjacent 24 and contiguous to certain real property currently owned or leased 25 by Participant and developed with a hospital and medical office 26 building (the "Participant's Adjacent Property"). Participant's 27 Adjacent Property is shown on the Site Map (Attachment No. 2). RBK\AGM1\141931.8 -3- £-7 10/09/97 lL07am - - .- 1 The Site shall be divided into five (5) parcels (each, 2 a "Parcel") substantially as shown on the Site Map and described 3 as follows: 4 5 (a) the Cancer Center Parcel - The Cancer Center 6 Parcel shall be the site of the Cancer Center, as described in 7 more detail in the definition of the First Phase below in this 8 Section lO4A¡ 9 10 (b) the First M.O.B. Parcel - The First MOB shall be 11 the site of the First MOB, as described in more detail in the 12 definition of the Ultimate Phase below in this Section lO4A¡ 13 14 (c) the Second MOB Parcel - the Second MOB Parcel 15 shall be the site of the Second MOB, as described in more detail . 16 in the definition of the Ultimate Phase below in this Section 17 104A¡ . 18 19 (d) the Parking Parcel - the Parking Parcel shall be 20 the site of the Parking Structure, as described in more detail in 21 the definition of the Ultimate Phase below in this Section 104A; 22 and 23 24 (e) the Hospital Pùrcel - the Hospital Parcel, which 25 shall include a portion of the Participant's Adjacent Property, 26 shall be the site of the hospital expansions in the First Phase 27 RBKIAGMT\141931.8 -4- 10/09/97 [[,07"" £-v - - .- . 1 and the Ultimate Phase, as described in more detail below in this 2 Section 104A. 3 4 For the purposes of this Agreement, the "First Phase" 5 shall consist of the construction of hospital expansion measuring 6 approximately 34,100 gross square feet, the construction of a 7 radiation oncology facility containing approximately 11,000 8 square feet of floor area (the "Cancer Center") and the 9 installation of surface parking spaces (as described in the Basic 10 Concept Drawings), all as described in the Basic Concept 11 Drawings, which have been prepared by Participant and approved by 12 Agency and other applicable government agencies as described in 13 Section 303 of this Agreement. For the purposes of this 14 Agreement the "Ultimate Phase" shall consist of construction of a 15 hospital expansion"measuring approximately 82,925 gross square 16 feet, the construction of two medical office buildings, 17 containing approximately 124,500 square feet of floor area in the . 18 aggregate (respectively, the "First MOB" and the "Second MOB") 19 and the installation of a parking structure (as described in the 20 Basic Concept Drawings), all in accordance with the Basic Concept 21 Drawings, which have been prepared by Participant and approved by 22 Agency and other applicable government agencies as described in 23 Section 303 of this Agreement. The Scope of Development 24 (Attachment No. 4) more particularly sets forth,the component 25 parts of the First and Ultimate Phases ( collectively, the 26 "Phases") ." 27 RBKIAGMT\141931.8 -5- £-, 10/09/97 1I,07am 1 E. [§105] Parties to this Aqreement 2 3 1. [§106] Aqency 4 5 Agency is a public body, corporate and politic, 6 exercising governmental functions and powers and organized and 7 existing under the Community Redevelopment Law of the State of 8 California (Health and Safety Code Section 33000, et. ~.). The 9 office of Agency is located at 276 Fourth Avenue, Chula Vista, 10 California 92010. "Agency", as used in this Agreement, includes 11 the Redevelopment Agency of the City of Chula Vista and any 12 assignee of or successor to its rights, powers and 13 responsibilities. 14 15 2. [§lQ7] Participant 16 17 Participant is SCRIPPS HEALTH, a California non- , 18 profit public benefit corporation. For purposes of this 19 Agreement, the address of Participant is 4275 Campus Point Court, 20 San Diego, California 92121. Wherever the term "Participant" is 21 used herein, such term shall include any permitted nominee, 22 assignee or successor in interest as herein provided. 23 Participant's counsel are Richard F. Seiden, Esq. and Ralph B. 24 Kostant, Esq., of Foley LardnerWeissburg & Aronson, at 25 2029 Century Park East, Suite 3500, Los Angeles, California 26 90067-3000. 27 RBK\AGM1\141931.8 -6- £-10 10109197 11:07"" - - 1 The qualifications and identity of Participant are 2 of particular concern to City and Agency, and it is because of 3 such qualifications and identity that Agency has entered into 4 this Agreement with Participant. No voluntary or involuntary 5 successor-in-interest of Participant shall acquire any rights or 6 powers under this Agreement except as expressly set forth herein. 7 Except as otherwise expressly set forth herein, Participant shall 8 not assign all or any part of this Agreement without the prior 9 written approval of Agency which approval is reserved to the sole 10 discretion of Agency. Agency shall not withhold its approval of 11 an assignment by Participant of its interest under this Agreement 12 as to particular buildings or Parcels to an affiliate company 13 (hereafter, a "Participant Affiliate") directly controlling, 14 controlled by or under common control or membership with 15 Participant (inc1 uding, without limitation, a limited partnership 16 in which Participant is a general partner) provided that: 17 (1) Participant remains responsible for the performance of the . 18 obligations of Participant under this Agreement; (2) such 19 assignment will in no way diminish, at the time of such approval 20 or at any time thereafter, Agency's rights under this Agreement 21 or Participant's ability to perform its obligations under this 22 Agreement; and 3) such assignee shall be of comparable experience 23 and qualifications as Participant, shall demonstrate the capacity 24 to perform the obligations of Participant and shall expressly 25 assume in a writing satisfactory to Agency the obligations of 26 Participant with respect to the interest so assigned. 27 RBKlAGMTl141931.8 -7- £ -, I 10/09/97 II.07am - - 1 Participant shall promptly notify Agency of any 2 and all changes whatsoever resulting, in the aggregate, in a 3 change of more than fifty percent (50%) of the membership of 4 Participant. 5 6 The parties hereby acknowledge that one purpose of 7 this Agreement is to provide for the expansion of the existing 8 hospital facility located on Participant's Adjacent Property and 9 that any attempt to transfer Participant's rights under this 10 Agreement apart from Participant's Adjacent Property (except to a 11 Participant Affiliate), or for purposes other than the proposed 12 expansion of the existing hospital and construction of the Cancer 13 Center, medical offices and parking facilities shall be void. 14 15 F. [§108] . Conditions Precedent to Aqencv Acceptance and 16 Execution of Prior Aqreement 17 ' 18 1. [§ 108] Satisfaction of Conditions Precedent 19 20 Agency and Participant agree and acknowledge that 21 Participant fully performed all of its obligations under 22 Sections 109 through 117 of the Prior Agreement and that all of 23 the conditions precedent to Agency's Acceptance and Execution of 24 the Prior Agreement were satisfied. 25 26 27 RBKIAGMT\141931.8 -8- £ -I 2- 1O/09/9711:07am 1 2. [§ 109] Aqency Option 2 3 Because Participant has acquired the entire Site, 4 the conditions for exercise of the Agency Option described in 5 Sections 116 and 121 of the Prior Agreement can no longer occur. 6 Concurrently with the execution of this Agreement, Agency and 7 Participant return the Agency Option, which has not been 8 recorded, to Participant, and the Agency Option thereupon shall 9 terminate and be of no further force or effect. 10 11 3. [§ 110] Aqency Reverter 12 13 Participant and Agency recognize that the Agency 14 Reverter described in Section 121 of the Prior Agreement presents 15 an impediment to obtaining adequate development financing for the 16 First Phase and the Ultimate Phase. Therefore, concurrently with 17 the execution of the Agreement, Agency and Participant shall . 18 execute, deliver and record a document terminating the Agency 19 Reverter. 20 21 4. [§ 111] Site LaC 22 23 Agency and Participant agree and acknowledge that 24 the obligations of Participant, regarding acquisition of the Site 25 and relocation of the businesses formerly located on the Site, 26 which were secured by the Site LaC described in Section 120 of 27 the Prior Agreement, have been fully performed and satisfied. RBK\AGMTlI41931.8 -9- £-/~ 10/09/97 11:07am - . 0"- 1 Consequently, concurrently with the execution of this Agreement, 2 Agency shall release the Site LOC to Participant. 3 4 II. [§20Q] CONVEYANCE OF THE SITE TO PARTICIPANT 5 6 A. [§201] Site Acquired and Conveved to Participant 7 8 Agency and Participant agree and acknowledge that 9 Agency has acquired the Site and conveyed it to Participant, and 10 that both Agency and Participant have fully performed all of 11 their respective obligations under Sections 201 through 211 of 12 the Prior Agreement. 13 14 B. [§202] Indemnification of Aaencv 15 16 1. Generallv. It is understood and agreed that the 17 parties hereto have entered this Agreement as a method of . 18 providing necessary Agency assistance to Participant in 19 connection with the elimination of blight and re-development of 20 the Site pursuant to the Redevelopment Plan and that by assisting 21 in the accomplishment of such redevelopment, City and Agency 22 assume no responsibility for insuring that the same is adequately 23 undertaken (including, without limitation, the remediation of any 24 hazardous or toxic substance¿ on the Site) and as a material 25 consideration to Agency for entering into this Agreement, except 26 as expressly provided to the contrary in this Agreement, and 27 except as expressly provided to the contrary in clause 2, below, RBK\AGMT\141931.8 -10- ~-/~ 10/09/97 [[,00"" - - -- 1 Participant agrees to indemnify, defend and hold Agency and City 2 harmless from and against any and all claims, actions, demands, 3 liabilities, obligations, expenses, damages, losses or costs, 4 which may arise or are in any manner connected with the 5 redevelopment of the Site pursuant to this Agreement, including 6 any unresolved relocation issues. Further, except as expressly 7 provided to the contrary in clause 2, below, Participant hereby 8 agrees to indemnify, defend and hold Agency and City harmless 9 from and against any and all claims, actions or proceedings which 10 seek to attack, set aside, void or annul the approval, execution 11 or consummation of this Agreement (or any land use entitlements 12 granted to Participant to permit its development of the Site 13 pursuant to the provisions of this Agreement), which claims, 14 actions or proceedings are based, in whole or in part, upon 15 allegations that such approval, execution or consummation was 16 undertaken without compliance with law, including, by way of 17 example only, the requirements of the California Environmental . 18 Quality Act (Public Resources Code Section 21000, e t .ê..§g.), the 19 Community Redevelopment Law (Health and Safety Code Section 20 33000, et .ê..§g.) or the Eminent Domain Law (CCP Section 1230.010, 21 e t .ê..§g.). The indemnity by Participant as set forth above shall 22 survive the termination of this Agreement regardless of the 23 reason for such termination. 24 25 2. Exemptions. The obligations of the Participant to 26 indemnify, defend and hold Agency and City harmless under 27 clause 1 above shall not extend to claims, actions, proceedings, RBK\AGMT\141931.8 -11- E-/~ 10/09/97 11,07"" - - - - 1 demands, liabilities, obligations, expenses, damages, losses or 2 costs which arise out of or are based upon (i) the intentionally 3 wrongful, reckless or grossly negligent acts or omissions of 4 officers, officials or employees of Agency or City; or (ii) the 5 failure by Agency to follow proper procedures, including public 6 notices and public hearings, in the adoption of this Agreement. 7 If a matter arises out of or is based in part upon matters 8 excepted from the indemnification obligations of Participant by 9 this paragraph, and in part upon matters that are covered by 10 Participant's indemnification obligations, then Participant shall 11 be responsible only for the portion of the claim, actions, 12 proceeding, demand, liability, obligations, expense, damage, loss 13 or cost that is fairly attributable to matters covered by 14 Participant's indemnification obligations under clause 1, based 15 on an application óf the principles of comparative liability 16 under California law. If Agency or City tender a matter to 17 Participant for indemnification or defense pursuant to this . 18 Section 202, and Participant reasonably and in good faith 19 believes that the matter is subject to the exception to 20 Participant's indemnification obligations contained in this 21 clause 2, then Participant shall assume the defense of such 22 matters subject to a reservation of the right to claim, following 23 final determination for the matter, that the matter was not 24 subject to the indemnification obligations of Participant. To 25 the extent the final resolution of any such matter includes a 26 determination that an officer, official or employee of City or 27 Agency committed an intentionally wrongful, reckless or grossly RBK\AGM1\141931.8 -12- £: -If. 1O/09/9711:07am 1 negligent act or omission, then the matter shall be deemed not to 2 be covered by Participant's indemnification obligations. Any 3 dispute remaining over whether a matter is covered by 4 Participant's indemnification obligations following final 5 determination for the matter shall be resolved by a reference 6 proceeding, as described in Section 607, below. If such a 7 dispute is resolved in Participant's favor, then Agency shall 8 reimburse Participant for all out-of-pocket costs and expenses 9 incurred by Participant on account of the matter, including 10 payments made in satisfaction of judgments or awards, attorneys' 11 fees and litigation costs and expenses. 12 13 3. Expense Limitation. Notwithstanding anything to 14 the contrary set forth in this Section 202, in the event that, at 15 any time, Agency r~asonably determines that the aggregate 16 monetary risk to Agency (in terms of potential reimbursement 17 obligations of Agency arising out of defenses which Participant . 18 has assumed subject to the "reservation of rights" described, 19 above) is greater than $100,000.00, Agency may, upon written 20 notice to Participant, elect to terminate the executory 21 provisions of this Agreement. Such election to terminate shall 22 not be effective in the event that, within thirty (30) calendar 23 days of Agency's election to so terminate, Participant notifies 24 Agency of its election to waive any such "reservation of rights," 25 as to the monetary risk to the Agency in excess of $100,000.00. 26 27 RBK\AGMTl141931.8 -13- £-/7 10109/97 11 ,07am - - -- 1 III. [§300] DEVELOPMENT OF THE SITE 2 3 A. [§30l] Development of the Site bv Participant 4 5 1. [§302] Scope of Development: Relationship of 6 Ultimate Phase to Aqreement 7 8 The First Phase shall be developed by Participant, 9 within the time set forth in the Schedule of Performance 10 (Attachment No. 5), at Participant's sole cost and expense, being 11 comprised of, generally, a hospital expansion measuring 12 approximately 34,100 gross square feet, the Cancer Center 13 containing approximately 11,000 square feet of floor area and 14 surface parking spaces (as described in the Basic Concept 15 Drawings). 16 17 The Ultimate Phase, generally comprised of a , 18 hospital expansion measuring approximately 82,925 gross square 19 feet, two medical office buildings, the First MOB and the Second 20 MOB, respectively, containing in the aggregate approximately 21 124,500 square feet of floor area and a parking structure (as 22 described in the Basic Concept Drawings) (all as described in the 23 Basic Concept Drawings and as shown in the Scope Development 24 (Attachment No. 4)), is not r€quired to be developed by 25 Participant pursuant to this Agreement. 26 27 RBKIAGMT\141931.8 -14- E-li 10/09/97 11 :07= - - 1 Notwithstanding that Participant shall not be 2 required to develop the Ultimate Phase, no development of the 3 Site beyond the First Phase shall be undertaken unless such 4 development is in accordance with the Basic Concept Drawings for 5 the Ultimate Phase (as such Basic Concept Drawings may be further 6 developed pursuant to the mechanics generally described in this 7 Article III) and in full compliance with the requirements of this 8 Article III relating to insurance and indemnification, rights of 9 access, compliance with laws and anti-discrimination. 10 11 2. [§303] Basic Concept Drawinqs 12 13 The Site shall be developed as generally 14 established in the Basic Concept Drawings as approved by the 15 Design Review Committee on July 24, 1995 (referred to in this 16 agreement as the "Design Approval" or the "Basic Concept 17 Drawings"). . 18 19 3. [§304] Construction Plans. Drawinqs and Related 20 Documents 21 22 Participant shall prepare and submit plans, 23 drawings and related documents to Agency for architectural and 24 site planning review and written approval as and at the times 25 established in the Schedule of Performance (Attachment No. 5). 26 The plans, drawings and related documents are divided into two 27 stages: preliminary and final working. Preliminary plans, RBK\AGM1\141931.8 -15- £: -1'1 10/09/97 11.07"" 1 drawings and related documents already have been submitted to and 2 approved by Agency. With respect to final working plans, 3 drawings and related documents for the proposed hospital 4 expansion, final working plans, drawings and related documents 5 are hereby defined as those submitted to the California Office of 6 Statewide Health Planning and Development ("COSHPD") to obtain a 7 building permit. With respect to all other final working plans, 8 drawings and related documents, final working plans, drawings and 9 related documents are hereby defined as those in sufficient 10 detail to obtain a building permit. 11 12 Participant has prepared and submitted preliminary 13 landscaping plans, which Agency has reviewed and approved. 14 Participant shall also prepare and submit to Agency for its 15 review and written 'approval final landscaping and finished 16 grading plans for the Site. Such final landscaping and finished 17 plans shall be prepared and submitted within the times , 18 established in the Schedule of Performance (Attachment No. 5). 19 20 4. [§305] Aqencv Approval of Plans. Drawinqs and 21 Related Documents 22 23 Agency's principal concerns in its review of 24 plans, drawings and related documents referred to in Section 304, 25 above (collectively, the "Plans") are (a) external aesthetics, 26 (b) relationship to adjacent land and improvements, particularly 27 RBK\AGM'T\141931.8 -16- £-,;J-Q 10109/97 11:07"" - - .,- 1 Participant's Property, including public rights-of-way, and 2 (c) traffic. 3 4 The Executive Director (or designee) shall, on 5 behalf of Agency, approve or disapprove the Plans within the 6 times established in the Schedule of Performance (Attachment 7 No. 5). Any disapproval shall state in writing the reasons for 8 disapproval and the changes which Agency requests be made. Such 9 reasons and such changes must be consistent with the Scope of 10 Development (Attachment No. 4) and any items previously approved 11 under this Agreement by Agency. Participant, upon receipt of a 12 disapproval based upon powers reserved by Agency hereunder, shall 13 revise such Plans and resubmit them to Agency as soon as possible 14 after receipt of the notice of "disapproval, provided that in no 15 case shall Agency Be entitled to require changes inconsistent 16 with the Scope of Development and any previously approved items. 17 . 18 If any revisions or corrections of the Basic 19 Concept Drawings or the Plans previously approved by Agency shall 20 be required by the City Department of Building and Housing, 21 COSHPD or any other government official, agency, department or 22 bureau having jurisdiction, or any lending institution involved 23 in Acceptable Mortgage Financing, Agency shall give reasonable 24 consideration to such revisions or corrections. To the extent 25 such revisions or corrections are materially inconsistent with 26 such overall design or would materially diminish such economic 27 value, Participant and Agency shall cooperate in efforts to RBKIAGMT\141931.8 -17- E-d-( 10/09/97 [[ :07am - - .- 1 obtain a waiver of such requirements or to develop a mutually 2 acceptable alternative. 3 4 In no event shall any approval by Agency of any 5 item for which Agency's approval is required pursuant to 6 Sections 304 or 305 of this Agreement be unreasonably withheld. 7 In the event Agency fails to evidence its disapproval of any such 8 item within the time frames provided for under the terms of 9 Sections 304 or 305, such approval shall be deemed given. 10 11 It is understood by Participant that Agency's 12 review of the Plans, as described above, shall be primarily 13 focused upon aesthetics, interrelationship and traffic, and that 14 there will be significant other review of the Plans required by 15 other governmental 'agencies (including, without limitation, the 16 City Department of Building and Housing). Participant shall bear 17 full responsibility for making timely submittals and obtaining . 18 all approvals in connection with such other reviews, all as more 19 particularly provided in Attachment No. 5 (Schedule of 20 Performance). The Executive Director (or designee) shall provide 21 all assistance deemed appropriate by Agency to Participant in 22 connection with such other reviews. 23 24 5. [§306] Cost of Construction 25 26 The cost of developing the Site and constructing 27 all improvements thereon shall be borne by Participant. Without RBK\AGMT\141911.8 -18- .. -,;2~ 10/09/97 11 :07am - - 1 limiting the generality of the foregoing, Participant shall be 2 responsible for any and all costs associated with the 3 accomplishment of any mitigation measures and offsite 4 improvements (including, by way of example only, those which may 5 be described: (i) in the Environmental Impact Report of the 6 Project (the "Project EIR") , (ii) in connection with the City 7 Design Review Board's approval of the Basic Concept Drawings, or 8 (iii) as part of the "Municipal code Requirements" imposed in 9 connection with City's approval of the "Parcel Map", as provided 10 in Section 314, below), which mitigation measures or offsite 11 improvements have been (or shall hereafter be) specifically 12 required to be accomplished as conditions to development of the 13 Site pursuant to this Agreement. It is understood that due, in 14 part, to such factors as the number of agencies involved in the 15 approval of the PrQject and the length of time over which the 16 Project will (or may, with respect to the Ultimate Phase) be 17 developed, Agency can offer Participant absolutely no assurances , 18 as to the complete scope of on-site and off-site improvements or 19 mitigation measures which Participant may be required to 20 accomplish or the effective periods of any and all entitlements 21 granted to permit such development, it being agreed that such 22 matters are the sole responsibility of Participant. 23 24 25 26 27 RBK\AGMT\141931.8 -19- £-~3 10/09/97 11.07am - - . T 1 6. [§307] Construction Schedule 2 3 By the milestone date set forth in the Schedule of 4 Performance (Attachment No. 5), Participant shall begin and 5 thereafter shall diligently prosecute to completion the 6 construction of the improvements and the development of the First 7 Phase. Participant shall begin and complete all construction and 8 development within the times specified in the Schedule of 9 Performance (Attachment No. 5) or such reasonable extension of 10 said dates as may be granted by Agency or as provided in 11 Section 604 of this Agreement. The Schedule of Performance is 12 subject to revision from time to time as mutually agreed upon in 13 writing between Participant and Agency. 14 15 During the period of construction, but not more 16 frequently than once a month, Participant shall submit to Agency 17 a written progress report of the construction when and as . 18 requested by Agency. The report shall be in such form and detail 19 as may reasonably be required by the Executive Director (or 20 designee) and shall include a reasonable number of construction 21 photographs taken since the last report submitted by Participant. 22 23 7. [§307A] Deliverv of Evidence of Eauitv Capital 24 and Mortaaae Financina Commitments 25 26 Within sixty (60) days after the Execution Date, 27 as required in the Schedule of Performance (Attachment No. 5), RBKIAGMT\14193L8 -20- £-.:2'1 1O/09/9711,07am - - I 1 Participant shall have submitted to Agency evidence reasonably 2 satisfactory to the Executive Director that Participant has the 3 equity capital and financing commitments for "Acceptable Mortgage 4 Financing" (as such term is defined below) necessary for 5 development of the First Phase (or portion thereof) pursuant to 6 this Agreement. As used herein, the term "Acceptable Mortgage 7 Financing" shall mean financing reasonably satisfactory to 8 Agency. In no event shall Agency's disapproval be deemed 9 unreasonable in the event (i) such proposed financing is not from 10 a reputable financial or lending institution, or (ii) in the 11 event any mortgage, deed of trust or other security instrument 12 associated with such financing is proposed to encumber the Site, 13 or any portion thereof: (x) the proceeds of such financing are to 14 be used, in whole or in part, for purposes other than the 15 development of the.First Phase (or applicable portion thereof) 16 pursuant to this Agreement, (y) the portion of the Site which is 17 to be encumbered by such financing is not capable of being , 18 reconveyed from the lien thereof based upon an "at par" formula, 19 or (z) if any holder of an Acceptable Mortgage Financing were to 20 acquire title to such encumbered portion of the Site under such 21 mortgage, deed of trust or other security instrument, such 22 acquisition would have the effect of extinguishing, or 23 diminishing, the effect of the' "Reciprocal Parking Agreement" (as 24 such term is defined in Section 314 below) with respect to such 25 acquired portion, to the detriment of the remainder of the Site. 26 Participant shall use best efforts to cause any such Acceptable 27 Mortgage Financing which shall encumber the Site to be assumable RBK\AGMT\141931.8 - 21- I: -tiZ :;-- 10/09/97 11,07am 1 without the payment of a fee or premium (hereafter, an 2 "Assumption Fee"). In no event shall the provision for the 3 payment of a reasonable prepayment penalty (a "Prepayment 4 Penalty") be grounds for disapproval by Agency of any proposed 5 financing. 6 7 8. [§308] Insurance and Indemnification 8 9 Prior to the commencement of construction on the 10 Site or any portion thereof, with respect to any given Phase, 11 Participant shall furnish or cause to be furnished to Agency 12 duplicate originals or appropriate certificates of bodily injury 13 and property damage insurance in a combined single-limit policy 14 amount of at least $5,000,000, naming Agency and City, and their 15 respective officer~, employees, agents, invitees and contractors, 16 as additional or co-insureds. Participant shall also furnish or 17 cause to be furnished to Agency evidence reasonably satisfactory . 18 to the Executive Director (or designee) that any contractor with 19 whom it has contracted for the performance of work on the Site 20 carries workers' compensation insurance as required by law. 21 22 In addition to the insurance requirements of this 23 Section, Participant shall assume and be responsible for, and 24 shall indemnify, defend and hold harmless Agency and City, and 25 their respective officers, employees, agents, invitees and 26 contractors, from and against any and all claims, actions, 27 demands, liabilities, obligations, expenses, damages, losses or RBKIAGMT\141931.8 -22- E - õ2.f. 10/09/97 II 001"" - . .. 1 costs, which may arise out of or are in any manner connected with 2 the performance of the work called for by this Agreement, except 3 to the extent the same arise as a result of the negligence or 4 willful misconduct of Agency, City or their respective officers, 5 employees, agents, invitees and contractors. 6 7 The obligations to provide insurance as set forth 8 in this Section 308 shall remain in effect with respect to any 9 given Parcel under any given Phase only until a Certificate of 10 Completion has been issued with respect to such Parcel under the 11 given Phase, however, such insurance shall provide protection to 12 City and Agency against claims, actions, demands, etc., arising 13 after issuance of the Certificate of Completion for acts or 14 omissions during construction and Participant's obligation to 15 save, indemnify, d~fend and hold City and Agency harmless from 16 and against all of the same, shall survive the obligation to 17 insure and the termination of this Agreement regardless of the . 18 reason for such termination. 19 20 9. [§309] Delivery of Evidence of Submission and 21 Approval bv State of Plans for Expansion 22 Hospital Facilitv: Citv and Other 23 Governmental Aqencv Permits 24 25 No later than the times specified in the Schedule 26 of Performance (Attachment No. 5), Participant shall deliver to 27 Agency evidence satisfactory to the Executive Director (or RBK\AGM1\141931.8 -23- £-,;¿7 10/09/97 11,07am . . 1 designee) that it has submitted to, and has received approval by, 2 all necessary agencies of the State of California of the Plans 3 for the First Phase expansion of the existing hospital facility 4 as contemplated by this Agreement. Before commencement of 5 construction or development of any buildings, structures or other 6 work of improvement upon the Site, Participant shall, at its own 7 expense, secure or cause to be secured any and all permits which 8 may be required by City or any other governmental agency having 9 jurisdiction over such construction, development or work. The 10 Executive Director (or designee) shall provide all assistance 11 deemed appropriate by Agency to Participant in securing these 12 permits. 13 14 10. [§310] Riqhts of Access 15 . 16 For the purposes of assuring compliance with this 17 Agreement, representatives of Agency and City shall have the , 18 reasonable right of access to the Site without charges and at 19 normal construction hours during the period of construction for 20 the purposes of this Agreement, including, but not limited to, 21 the inspection of the work being performed in constructing the 22 improvements. Such representatives of Agency shall be those who 23 are so identified in writing by the Executive Director. Agency 24 shall indemnify and hold harmless Participant and its officers, 25 employees, agents, invitees and contractors from any and all 26 actions, claims, demands, obligations, liabilities, losses, 27 expenses, costs and damages arising out of its exercise of this RBKIAGMT\14193I.8 -24- /:-;¿f' 1O/O919711,07am - - ... - 1 right to access, except to the extent any of the same arise as a 2 result of the negligence or willful misconduct of Participant or 3 its officers, employees, agents, invitees and contractors. The 4 foregoing obligation to indemnify and hold harmless shall survive 5 the termination of this Agreement regardless of the reason for 6 such termination. 7 8 11. [§311] Local. State and Federal Laws 9 10 Participant shall carry out the construction of 11 the improvements in conformity with all applicable laws, 12 including all applicable federal and state labor standards. 13 14 12. [§312] Anti-Discrimination Durinq Construction 15 16 Participant, for itself and its successors and 17 assigns, agrees that in the construction of the improvements , 18 provided for in this Agreement, Participant will not discriminate 19 against any employee or applicant for employment because of race, 20 color, creed, religion, sex, marital status, age, handi caps, 21 ancestry or national origin. 22 23 13. [§313] Consummation of Certain Relocation 24 Aqreements 25 26 Agency and Participant agree and acknowledge that 27 Agency and Participant have fully performed their respective RBK\AGM1\141931.8 -25- £-:1'1 10/09/97 11:07"" 1 obligations under Section 313 of the Prior Agreement and the 2 Theater/Skating Relocation Obligations, except for their 3 respective continuing obligations under guarantees entered into 4 pursuant to performance of the Relocations Obligations. 5 6 B. [§3l4] Parcel Map 7 8 Agency, through its staff, shall make good faith 9 efforts to cooperate with any and all reasonable requests for 10 assistance that Participant may make in connection with 11 processing of a parcel map (the "Parcel Map") subdividing the 12 Site into the Parcels in substantially the configuration set 13 forth on the Site Map. Provided that Participant files its 14 application for the Parcel Map within the time period required by 15 the Schedule of Pe~formance, and thereafter diligently prosecutes 16 its application, responding in a timely manner to all reasonable 17 requests from City for materials supporting the application for . 18 the Parcel Map, then the obligation of Participant to commence 19 construction of the First Phase shall be conditioned upon 20 approval by City of the Parcel Map, and delays in approval of the 21 Parcel Map beyond the time period specified in the Schedule of 22 Performance shall be deemed an event entitling Participant to an 23 extension of time of performance under the provisions of Section 24 604 of this Agreement (to the extent such delays actually cause 25 delay in Participant's performance of its obligations under this 26 Agreement). However, Participant may elect to waive that 27 condition, and to commence construction of the First Phase RBKIAGMT\141931.8 -26- £ -3D 10/09/97 11007= 1 without approval of the Parcel Map, in which case City shall 2 issue a building permit for the First Phase without prior 3 approval or recordation of the Parcel Map. 4 5 In no event shall Participant be required, in order to 6 obtain approval of the Parcel Map or a building permit for the 7 First Phase, to agree to any conditions of approval requiring 8 construction of on-site improvements or off-site public 9 improvements, or implementation of environmental mitigation 10 measures, other than those (collectively, the "Project 11 Measures"): (i) specifically contemplated in the Basic Concept 12 Drawings (including, without limitation, any conditions to the 13 City Design Review Board's approval thereof), (ii) imposed 14 pursuant to terms of the Project EIR, the Conditional Use Permit 15 or the Special Use.permit as a condition to development of the 16 Project, or (iii) other municipal code requirements (the 17 "Municipal Code Requirements") generally required to be satisfied 18 by developers of projects of the sort contemplated to be 19 developed by Participant pursuant to the provisions of this 20 Agreement, including, without limitation, the payment of any and 21 all fees required (whether now or in the future) to be paid on or 22 before issuance of building permits, excluding therefrom, 23 however, any such municipal code requirements requiring 24 construction of on-site impro~ements or off-site public 25 improvements, or-fees or other financing defraying the costs of 26 such improvements. 27 E-~I RBKIAGMT\141931.8 -27- 10/09/9711:07"" - . - T 1 As a condition for the final approval of the Parcel 2 Map, an agreement (the "Reciprocal Easement Agreement"), in form 3 and content reasonably acceptable to Agency (and City, if 4 applicable), providing for the joint use of parking facilities 5 and easements for vehicular and pedestrian passage on the Site 6 and Participant's Adjacent Property by the owners of the Site and 7 Participant's Adjacent Property, tenants and their respective 8 employees and invitees, shall be prepared and executed, and shall 9 be recorded immediately upon recordation of the Parcel Map. 10 11 C. [§315] Taxes. Assessments. Encumbrances and Liens 12 13 Participant ,shall pay when due all real estate taxes 14 and assessments assessed and levied on the Site. Prior to the 15 issuance of the Final Certificate of Completion, Participant 16 shall not place or allow to be placed on any portion of the Site 17 which is not the subject of a Certificate of Completion any , 18 mortgage, trust deed, encumbrance or lien other than those 19 arising out of Acceptable Mortgage Financing (hereafter, each an 20 "Acceptable Mortgage"). Prior to the issuance of the Final 21 Certificate of Completion, Participant shall remove or have 22 removed any levy or attachment made on any portion of the Site 23 which is not the subject of a Certificate of Completion or shall 24 assure the satisfaction thereof, within a reasonable time, but in 25 any event prior to a sal.e thereunder. Nothing herein contained 26 shall be deemed to prohibit Participant from contesting the 27 validity or amounts of any tax, assessment, encumbrance or lien, RBK\AGM1\141931.8 -28- £-ß;}.. 10/09/97 11,07"" 1 nor to limit the remedies available to Participant in respect 2 thereto. 3 4 Participant understands that under certain conditions, 5 under applicable tax law, its control of the Site under this 6 Agreement may give rise to the imposition of possessory interest 7 tax on said property. In such event, Participant agrees to pay, 8 or cause to be paid, when due any such possessory interest tax. 9 10 Following the issuance of the Final Certificate of 11 Completion, Participant shall be entitled to freely encumber any 12 portion of the Site; provided, however, that without the prior 13 written consent of Agency, which may be withheld in Agency's sole 14 and absolute discretion, no holder of any such encumbrance shall 15 acquire any rights'under this Agreement. 16 17 D. [§316] prohibition Aqainst Transfer of Site. the , 18 Buildinqs or Structures Thereon and 19 Assiqnment of Aqreement 20 21 Prior to the issuance by Agency of the Final 22 Certificate of Completion, Participant shall not sell, transfer, 23 convey, assign or lease any part of the Site which is not the 24 subject of a Certificate of Completion without the prior written 25 approval of Agency; provided, however, that Agency shall not 26 withhold its approval of such a sale, transfer, conveyance, 27 assignment or lease by Participant to a Participant Affiliate; -29- £-33 RBK\AGMT\14193I.8 10109197 11 :07am - - -- 1 and provided further that Participant may lease the Cancer Center 2 Parcel to Scripps Chula Vista Outpatient Radiology Oncology 3 Center, L.P., a California limited partnership or its assignee. 4 This prohibition shall not be deemed to prevent the granting of 5 easements or permits to facilitate the development of the Site or 6 to prohibit or restrict the leasing or preleasing of any part or 7 parts of a building or structure when said improvements are 8 completed. 9 10 Following the issuance of the Final Certificate of 11 Completion, Participant shall be entitled to freely transfer any 12 portion of the Site; provided, however, that without the prior 13 written consent of Agency, which may be withheld in Agency's sole 14 and absolute discretion (except with respect to Participant 15 Affiliates), no su~h transfer shall act to grant or transfer to 16 the transferee any rights under this Agreement. 17 . 18 In the absence of specific written agreement by Agency, 19 no such transfer, assignment or approval by Agency shall be 20 deemed to relieve Participant or any other party from any 21 obligations under this Agreement or the Deed. 22 23 24 25 26 27 RBKIAGMT\141931.8 -30- £: -~" 10/09/97 1 1o07am - - 1 E. [§317] Securitv Financinq; Riqhts of Holders 2 3 1. [§3l8] Use of Financinq 4 5 Any financing used by Participant to develop the 6 First Phase, if secured by all or any portion of the Site, must 7 be Acceptable Mortgage Financing. 8 9 2. [§319] Holder Not Obliqated to Construct 10 Improvements 11 12 The holder of any Acceptable Mortgage shall in no 13 way be obligated by the provisions of this Agreement to construct 14 or complete the improvements or to guarantee such construction or 15 completion, nor sh~ll any covenant or any other provision in the 16 Deed be construed so to obligate such holder. Nothing in this 17 Agreement shall be deemed to construe, permit or authorize any . 18 such holder to: (i) devote the Site to any uses or to construct 19 any improvements thereon other than those uses or improvements 20 provided for or authorized by this Agreement, or (ii) once title 21 to the Site is conveyed to any such holder, avoid any other 22 obligation set forth in the Deed which is provided therein to run 23 with the land (including, without limitation, the obligation to 24 make In-Lieu Tax Payments, as described in Section 405, below). 25 26 27 RBK\AGMTl141931.8 -31- E:-4~ 10/09/9711007= - - I 1 3. [§320] Notice of Default to Mortqaqe. Deed of 2 Trust or Other Securitv Interest 3 Holders; Riqht to Cure 4 5 Whenever Agency shall deliver any notice or demand 6 to Participant with respect to any breach or default by 7 Participant in completion of construction of the improvements, 8 Agency shall at the same time deliver a copy of such notice or 9 demand to each holder of record of any Acceptable Mortgage who 10 has previously made a written request to Agency therefor. Each 11 such holder shall (insofar as the rights of Agency are concerned) 12 have the right, at its option, within ninety (90) days after the 13 receipt of the notice, to cure or remedy or commence to cure or 14 remedy any such default and to add the cost thereof to the 15 security interest debt and the lien on its security interest. In 16 the event there is more than one such holder, the right to cure 17 or remedy a breach or defåult of Participant under this Section , 18 320 shall be exercised by the holder first in priority or as the 19 holders may otherwise agree among themselves, but there shall be 20 only one exercise of such right to cure and remedy a breach or 21 default of Participant under this Section 320. Nothing contained 22 in this Agreement shall be deemed to permit or authorize such 23 holder to undertake or continue the construction or completion of 24 the improvements (beyond the extent necessary to conserve or 25 protect the improvements or construction already made) without 26 first having expressly assumed Participant's obligations to 27 Agency by written agreement satisfactory to Agency. The holder RBKIAGMT\141931.8 -32- E-.3-(. 10/09/97 l1:07am - - 1 in that event must agree to complete, in the manner provided in 2 this Agreement, the improvements to which the lien or title of 3 such holder relates and submit evidence satisfactory to Agency 4 that it has the qualifications and financial responsibility 5 necessary to perform such obligations. Subject to the 6 limitations described in Section 324, below, any such holder 7 properly completing such improvements shall be entitled, upon 8 written request made to Agency, to a Certificate of Completion 9 from Agency. 10 11 4. [§321] Failure of Holder to Complete 12 Improvements 13 14 In any case where, six (6) months after default by 15 Participant in completion of construction of improvements under 16 this Agreement, the holder of any Acceptable Mortgage has not 17 exercised the option to construct, or if it has exercised the , option and has not proceeded diligently with construction, 18 Agency 19 may purchase the Acceptable Mortgage by payment to the holder of 20 the amount equal to the sum of the following: 21 22 (a) The unpaid debt secured by the mortgage, deed 23 of trust or other security interest (less all 24 appropriate credits, including those 25 resulting from collection and application of 26 rentals and other income received with 27 respect to the Site); and RBKIAGM'!'\141931.8 -33- £-~7 10/09/97 1 ¡,Q7am - - -- 1 (b) Any other costs incurred and amounts advanced 2 by the holder to protect its security, as may 3 provided in the mortgage, deed of trust or 4 other security interest documents. 5 6 If the ownership of the Site has vested in the holder, Agency, if 7 it so desires, shall be entitled to a conveyance of the Site from 8 the holder to Agency upon payment to the holder of an amount 9 equal to the sum of the following: 10 11 (a) The unpaid debt secured by the mortgage, deed 12 of trust or other security interest of the 13 holder at the time title became vested in the 14 holder (less all appropriate credits, 15 . including those resulting from collection and 16 application of rentals and other income 17 received during foreclosure proceedings); . 18 19 (b) All expenses with respect to foreclosure; 20 21 (c) The net expenses, if any (exclusive of 22 general overhead), incurred by the holder as 23 a direct result of the subsequent management 24 of the Si'te; and 25 26 (d) The costs of any improvements made by such 27 holder authorized by this Agreement. RBKIAGMT\141931.8 -34- £-~'f 10/09/97 I L07"" 1 5. [§322] Riqht of Aqencv to Cure Mortqaqe. Deed 2 of Trust or Other Securitv Interest 3 Default 4 5 In the event of a default or breach by Participant 6 of an Acceptable Mortgage prior to the completion of development, 7 and the holder has not exercised its option to complete the 8 development, Agency may cure the default prior to completion of 9 any foreclosure. In such event, Agency shall be entitled to 10 reimbursement from Participant of all costs and expenses incurred 11 by Agency in curing the default. Agency shall also be entitled 12 to a lien upon the Site to the extent of such costs and 13 disbursements. Any such lien shall be subject to prior 14 Acceptable Mortgages. 15 . 16 F. [§323] Riqht of Aqencv to Satisfv Other Liens on the 17 Site After Title Passes . 18 19 After the conveyance of title to, or possession of, the 20 Site and prior to the issuance of the Final Certificate of 21 Completion (and after Participant has had a reasonable time to 22 challenge, cure or satisfy any liens or encumbrances on the 23 Site), Agency shall have the right to satisfy any such liens or 24 encumbrances, provided, however, that nothing in this Agreement 25 shall require Participant to payor make provision for the 26 payment of any tax, assessment, lien or charge so long as 27 Participant in good faith shall contest the validity or amount RBKIAGMT\141931.8 -35- /:-.5' 1O/09/9711,07am 1 thereof, and so long as such delay in payment shall not subject 2 the Site to forfeiture or sale. 3 4 G. [§324] Certificate of Completion 5 6 Promptly after completion of all construction and 7 development to be completed by Participant upon any given Parcel 8 under this Agreement with respect to any given Phase of the 9 development of the Site, other than tenant improvements, and 10 provided Participant is not otherwise in default under this 11 Agreement, Agency shall issue to Participant, with respect to 12 such Parcel, a certificate of completion (each, a "Certificate of 13 Completion") upon written request therefor by Participant. The 14 Certificate of Completion to be issued to Participant with 15 respect to the las~ Parcel required to be developed by 16 Participant under this Agreement in the First Phase shall also be 17 referred to herein as the "Final Certificate of Completion". . 18 Each Certificate of Completion shall be in the form attached 19 hereto as Attachment No. 7 and shall be recorded in the office of 20 the County Recorder of San Diego County. 21 22 A Certificate of Completion shall be, and shall so 23 state, conclusive determination of Participant's satisfaction of 24 its obligation to complete the construction required by this 25 Agreement with respect to the applicable Parcel under the 26 applicable Phase and required parking to serve that Parcel; 27 provided, however, that in no event shall such Certificate RBK\AGM1\141931.8 -36- E-c/O 1O/09/9711:07am - - . - 1 constitute a representation by Agency for any other purpose as to 2 the adequacy or completeness of such improvements or otherwise 3 relieve Participant of any liability for improper design or 4 construction (or other performance) of the improvements or of any 5 liability for any indemnity or other obligation undertaken by 6 Participant with respect to such improvements. 7 8 After issuance of the Final Certificate of Completion, 9 any party then owning or thereafter purchasing, leasing or 10 otherwise acquiring any interest in the Site shall not (because 11 of such ownership, purchase, lease or acquisition) incur any 12 obligation or liability under this Agreement, except that sùch 13 party shall be bound by any covenants contained in the Deed. 14 Except as otherwise provided herein, after the issuance of the 15 Final Certificate ~f Completion neither Agency, City nor any 16 other person shall have any rights, remedies or controls with 17 respect to the Site that it would otherwise have or be entitled . 18 to exercise under this Agreement as a result of a default in or 19 breach of any provision of this Agreement, except in the event of 20 the breach of any of the covenants contained in the Deed, and 21 except for those obligations specifically enumerated in this 22 Agreement which are intended by the parties hereto to survive 23 termination of this Agreement. 24 25 Agency shall not unreasonably withhold any Certificate 26 of Completion. If Agency refuses or fails to furnish a 27 Certificate of Completion after written request from Participant, RBK\AGMTlI41931.8 -37- £-", 10/09/97 [[ :07om - - .. - . 1 Agency shall, within ten (10) days of such written request, 2 provide Participant with a written statement of the reasons 3 Agency refused or failed to furnish a Certificate of Completion. 4 The statement shall also contain Agency's opinion of the action 5 Participant must take to obtain a Certificate of Completion. If 6 the reason for such refusal is confined to the immediate 7 unavailability of specific items or materials for landscaping, 8 Agency will issue its Certificate of Completion upon the posting 9 of a bond by Participant with Agency in an amount representing a 10 fair value of the work not yet completed. Any dispute between 11 the parties with respect to whether a Certificate of Completion 12 should be issued shall be resolved pursuant to Section 607 below. 13 14 Except as expressly provided in the second paragraph of 15 this Section 324, ~uch Certificate of Completion shall not 16 constitute evidence of compliance with or satisfaction of any 17 obligation of Participant to any holder of a mortgage or any . 18 insurer of a mortgage securing money loaned to finance the 19 improvements or any part thereof. Such Certificate of Completion 20 is not a notice of completion as referred to in California Civil 21 Code Section 3093. 22 23 Within fifteen (15) days of written request by 24 Participant, Agency shall execute and deliver to Participant or 25 to the holder of any Acceptable Mortgage an estoppel certificate 26 providing the following information, to the extent it is true: 27 RBK\AGMT\141931.8 -38- £-4~ 10109197 11007"" - - _.- 1 (i) that this Agreement is in full force and effect; 2 3 (ii) the amount of any funds and a description of any 4 letters of credit on deposit with Agency pursuant to the 5 provisions of this Agreement; 6 7 (iii) identification of any escrow that Agency has with 8 respect to the Site or with Participant pursuant to the 9 provisions of this Agreement; 10 11 (iv) that Participant is not in breach of any 12 obligations under this Agreement; but if Participant is in 13 breach, Agency should specify the nature of the breach in 14 reasonable detail; 15 16 (v) whether any circumstances have occurred that, with 17 the giving of notice by Agency or passage of time, would become a , 18 default under this Agreement; and 19 20 (vi) such other information about the Project as the 21 holder of the Acceptable Mortgage may reasonably request, with 22 the response to be limited to the best knowledge of Agency and 23 its officers and employees. 24 25 26 27 RBK\AGM1\141931.8 -39- E -43 10/09/9111007"" - - OCT-16-97 THU 14: 45 JAMES LEARY ARCH FAX NO. 5870576 P, 02 ac: :6. :99' ~: iZYM HW A "', -... - IV. [5400] COVElWfl'S PERTAmING TO THE SITE 2 11.. [5401J !l!!ü 3 P~rtic;.pant covenants and agr... for itself, 1ts 4 successors, its assigns and,every successor in interest that 5 during construction and thereafter, participant. its successors 6 and assignees shall d.evcte the entire Site to medical uses 7 ("Medioal Servioes"), including use IUI !l radiaticm oncology 8 facility and cance~ diagnQstic and treatment center (hereafter, 9 collectively, the "Dominant Uses"), together with ancillary 10 "Health-Related Activities" (as such te~ is defined below) or 11 such other uses as may De .pecified in the Deed, this Agreement 12 and a. specifically authorized in writing by Agency for the 13 periods of time specified therein, The foregoing covenants shall 14 run with the land and shall continue in effect until December 31, IS 2014, at which time they sball expix-e and =e of no fu:rthar 16 force or effecc. As used here;l.:¡, the term "HeAlth-Related 17 Activibies' shall m..n skilled nursing and intermediate care 18 facilitieø and hospice.; offices of health care professionals, HI including, without limitation. physicians, dentists, 10 psychologists, chirgprvctors, phYBica~ therapists an~ 21 optometrists, health education, therapy and counseling centers; 22 therapy and rehabilitation facilities; outpatient suzge%y 23 centere; clinics, offices of health maintenance organizations, 24 independent physicians associations, physiciAn practice 2S organizations, medical scaff groups and other health industry I 26 organizations: child care centers; pharmacies, gift shops, 27 restaurente and health care equipment stores; and other IUD<IA<!M'I'II"IIIJI.I -40- _11- £-4~ -. . . I 1 commercial, office and retail uses compatible with hospital and 2 medical office building use. Notwithstanding the generality of 3 the foregoing, it is understood and agreed that the intent of the 4 party hereto is to provide Participant with reasonable 5 flexibility to create a mix of uses for the Site other than the 6 Dominant Uses which supplement the overall quality of such 7 Dominant Uses and, to the extent Participant's use, or proposed 8 use, of the Site would suggest otherwise, the foregoing 9 definition shall be interpreted to be narrowed accordingly. 10 Additionally, all permitted uses must be conducted within the 11 hospital and medical building structures approved for development 12 pursuant to the terms of this Agreement. Uses of the Site other 13 than Medical Services shall be subject to the prior written 14 approval of Agency, which approval shall not be unreasonably 15 withheld or delayed and shall be based upon the foregoing 16 described criteria. The restrictive covenants set forth in the 17 last paragraph in Section 302 of this Agreement are hereby also , 18 incorporated into this Section 401 as covenants which shall run 19 with the land. 20 21 B. [§402] Maintenance 22 23 Participant hereby covenants and agrees for itself, its 24 successors, its assigns and every successor in interest to 25 maintain the Site and all improvements on the Site in first class 26 condition and repair and in accordance with all applicable laws, 27 permits, licenses and other governmental authorizations, rules, RBKIAGMJ\141931.8 -41- E - ciS" 10/09/9711,07= 1 ordinances, orders, decrees and regulations now or hereafter 2 enacted, issued or promulgated by federal, state, county, 3 municipal and other governmental agencies, bodies and courts 4 having or claiming jurisdiction and all their respective 5 departments, bureaus and officials. In addition, Participant 6 shall keep the Site free from any accumulation of debris or waste 7 materials, maintain in a healthy condition the landscaping 8 required to be planted in accordance with the Scope of 9 Development (Attachment No. 4), and to maintain the exterior of 10 all buildings on the Site in accordance with the Scope of 11 Development and the approved Plans. Any change in the exterior 12 of any building on the Site shall be subject to the prior written 13 approval of colors, design and materials by Agency. 14 15 participånt shall promptly and diligently repair, 16 restore, alter, add to, remove, and replace, as required, the 17 Site and all improvements and landscaping to maintain or comply , 18 as above, or to remedy all damage to or destruction of all or any 19 part of the improvements or landscaping. Any repair, 20 restoration, alteration, addition, removal, maintenance, 21 replacement and other act of compliance under this paragraph 22 (hereafter collectively referred to as "Restoration") shall be 23 completed by Participant whether or not funds are available from 24 insurance proceeds or tenant contributions, except to the extent 25 such Restoration is required as a result of damage or destruction 26 and either (i) insurance proceeds are not sufficient as,a result 27 of Participant's inability to obtain or maintain satisfactory RBK\AGMT\141931.8 -42- E -t/f" 10/09/97 11,07am - - I 1 insurance coverage at commercially reasonable rates, or 2 (ii) regardless of the availability of insurance proceeds, 3 Participant is able to demonstrate, to Agency's reasonable 4 satisfaction, that Restoration is economically infeasible, in 5 which event Participant's Restoration shall consist of clearing 6 and securing the applicable portion of the Site in a manner 7 reasonably satisfactory to Agency such that such portion of the 8 Site does not endanger public health, safety and welfare or 9 create a visual blight. In all other events of damage or 10 destruction, the Restoration shall return the condition of the 11 Site, improvements or landscaping to the condition existing 12 immediately prior to the date of such damage or destruction. If 13 at any time Participant or its successors fail to commence and 14 diligently prosecute to completion any required Restoration 15 within five (5) days after written notice from Agency, either 16 Agency or City may perform the necessary Restoration, and 17 Participant, or its successors in interest, shall pay such costs . 18 as are reasonably incurred for such Restoration. The foregoing 19 covenants shall run with the land. 20 21 For purposes of this Section 402, "first class 22 condition and repair", means Restoration which is necessary to 23 keep the Site, improvements and landscaping in efficient and 24 attractive condition, at least substantially equal in quality to 25 the condition which exists upon issuance of a Certificate of 26 Completion by Agency, subject to normal aging processes which 27 cannot be remedied by routine maintenance or which would not, RBK\AGMT\141931.8 -43- £-<17 10/09/9711:07"" - - . í 1 under standards which are applicable to improvements and 2 landscaping of comparable design and quality, normally be the 3 subject of an undertaking of renovation. 4 5 C. [§403] Obliqation to Refrain from Discrimination 6 7 Participant covenants by and for itself, its 8 successors, its assigns and every successor in interest to the 9 Site or any part thereof, that there shall be no discrimination 10 against or segregation of any person or group of persons on 11 account of race, color, religion, sex, marital status, age, 12 handicaps, ancestry or national origin in the sale, lease, 13 sublease, transfer, use, occupancy, tenure or enjoyment of the 14 Site, nor shall Participant itself or any person claiming under 15 or through it estaðlish or permit any such practice or practices 16 of discrimination or segregation with reference to the selection, 17 location, number, use or occupancy of tenants, lessees, . 18 subtenants, sublessees or vendees of the Site. The foregoing 19 covenants shall run with the land. 20 21 D. [§404] Form of Nondiscrimination and Non-Seqreqation 22 Clauses 23 24 Participant shall refrain from restricting the rental, 25 sale or lease of the Site on the basis of race, color, creed, 26 religion, sex, marital status, age, handicaps, ancestry or 27 national origin of any person. All such deeds, leases or RBKIAGMT\141931.8 -44- E - elf' 10/09/9711:07"" - - "" - . 1 contracts shall contain or be subject to substantially the 2 following nondiscrimination or non-segregation clauses: 3 4 1. In deeds: "The grantee herein covenants by and 5 for himself or herself, his or her heirs, 6 executors, administrators and assigns, and all 7 persons claiming under or through them, that there 8 shall be no discrimination against or segregation 9 of any person or group of persons on account of 10 race, color, creed, religion, sex, marital status, 11 age, handicaps, national origin or ancestry in the 12 sale, lease, sublease, transfer, use, occupancy, 13 tenure or enjoyment of the premises herein 14 conveyed, nor shall the grantee himself or 15 herself, or any person claiming under or through 16 him or her, establish or permit any such practice 17 or practices of discrimination or segregation with ' 18 reference to the selection, location, number, use 19 or occupancy of tenants, lessees, subtenants, 20 sublessees or vendees in the premises herein 21 conveyed. The foregoing covenants shall run with 22 the land." 23 24 2. In leases: "The lessee herein covenants by and 25 for himself or herself, his or her heirs, 26 executors, administrators and assigns, and all 27 persons claiming under or through him or her, and RBK\AGMT\141931.8 -45- £49 10/09/97 11 :07am - - 1 this lease is made and accepted upon and subject 2 to the following conditions: 3 4 "That there shall be no discrimination against or 5 segregation of any person or group of persons on 6 account of race, color, creed, religion, sex, 7 marital status, age, handicaps, national origin or 8 ancestry, in the leasing, subleasing, 9 transferring, use, occupancy, tenure or enjoyment 10 of the premises herein leased, nor shall the 11 lessee himself or herself, or any person claiming 12 under or through him or her, establish or permit 13 any such practice or practices of discrimination 14 or segregation with reference to the selection, 15 locåtion, number, use or occupancy of tenants, 16 lessees, subtenants, sublessees or vendees in the 17 premises herein leased." . 18 19 3. In contracts: "There shall be no discrimination 20 against or segregation of any person or group of 21 persons on account of race, color, creed, 22 religion, sex, marital status, age, handicaps, 23 national origin or ancestry in the sale, lease, 24 sublease, transfer, use, occupancy, tenure or 25 enjoyment of the premises, nor shall the 26 transferee himself or herself, or any person 27 claiming under or through him or her, establish or RBKIAGMT\141931.8 -46- £-sv 10/09/97 llÆam - - .-- . 1 permit any such practice or practices of 2 discrimination or segregation with reference to 3 the selection, location, number, use or occupancy 4 of tenants, lessees, subtenants, sublessees or 5 vendees of the land." 6 7 E. [§405] Obliqation to Make Payments in Lieu of 8 Propertv Taxes 9 10 1. As a part of the consideration to Agency for this 11 Agreement and Agency's assistance in the acquisition of the Site, 12 Participant, on behalf of itself and its successors, covenants 13 and agrees that it shall pay to Agency the amounts set forth in 14 Attachment No. 6 hereto, which are described as the "In-Lieu Tax 15 Payments. " . 16 17 2. Concurrently with the execution of this Agreement . 18 by Participant, Participant shall pay Agency the sum of Forty 19 Thousand Dollars ($40,000.00), which Agency and Participant agree 20 is the total In-Lieu Tax Payments due and payable by Participant 21 to Agency under the Prior Agreement up to and through the 22 Execution Date. Participant's satisfaction of its obligations 23 pursuant to this paragraph shall be a condition precedent to the 24 effectiveness of this Agreement. 25 26 3. The obligation to make the In-Lieu Tax Payments 27 shall survive the termination of this Agreement except in the RBKIAGMTlI41931.8 -47- £: -~-I 10/09/9711:07am - - .- 1 event such termination occurs as a result of an Agency Default; 2 provided, however, that in the event such termination occurs for 3 reasons other than either party's default Participant's only 4 obligation with respect thereto shall be to make In-Lieu Tax 5 Payments in arrears to the date of termination, which obligation 6 shall be satisfied immediately upon such termination and shall 7 survive such termination if not so timely paid. 8 9 4. If any possessory interest tax is paid in any tax 10 year with respect to any given portion of the Site, the amount of 11 the possessory interest tax shall be included in actual annual 12 property tax revenues for purposes of calculating Participant's 13 obligation to make In-Lieu Tax Payments as set forth in 14 Attachment No. 6. 15 16 5. Except as expressly provided to the contrary in 17 Attachment No. 6, in no event shall any provision of this , 18 Agreement (including, without limitation, Section 314 or 19 Section 604), or any agreement by the parties hereto to extend 20 the times specified in the Schedule of Performance (Attachment 21 No. 5) for Participant's performance, act to extend the time 22 frames for Participant's payment of In-Lieu Tax Payments. 23 24 6. .It is understood and agreed that, by virtue of its 25 inclusion in the Deed, although the obligation to make In-Lieu 26 Tax Payments is intended to be an obligation running with the 27 land, such obligation is, and shall remain, regardless of any RBK\AGM1\141931.8 -48- £ -5"óJ. 10/09/97 11:07am 1 transfer of the Site, the personal obligation of Participant; 2 provided, however, that (i) in the event any such transferee 3 defaults in its obligation to make In-Lieu Tax Payments, to the 4 extent Participant satisfies such defaulted upon obligation, 5 Participant shall be subrogated to Agency's rights to recover 6 such amount from such defaulting transferee, (ii) in the event 7 any such transferee constructs upon the Site improvements which 8 have received the approval of Agency, In-Lieu Tax Payments shall 9 be subject to an offset, on a year-by-year basis, by the amount 10 of actual property tax revenues generated thereby, and (iii) if 11 any such transferee is approved by Agency (which approval shall 12 not be unreasonably withheld) as a "Substantial Transferee" (as 13 defined below) prior to such transfer, Participant shall, upon 14 such transfer to the Substantial Transferee, be relieved as to 15 any personal oblig~tion accruing with respect to the transferred 16 portion of the Site after the date of such transfer. As used 17 herein, the term "Substantial Transferee" shall mean a person or , 18 entity with a net worth of greater than $25,000,000.00, which, in 19 the reasonable judgment of Agency staff, has the demonstrable 20 ability to assume and continue to perform Participant's In-Lieu 21 Tax Payment obligations under this Agreement with respect to the 22 portion of the Site so transferred (i.e., has a substantial 23 likelihood of performing such obligations while continuing to 24 maintain the net worth minimum set forth above), and which shall 25 execute an agreement in form and content acceptable to Agency 26 staff assuming such personal obligation of Participant. (Without 27 limiting the generality of the foregoing, such assumption RBK\AGMT\141931.8 -49- £"-.)-..3 10/09/97 [[ 007"" 1 agreement shall contain the agreement of such Substantial 2 Transferee to the provisions of Section 607 regarding reference 3 proceedings.) In no event are the provisions of this sub- 4 paragraph to be interpreted to permit Participant to conveyor 5 encumber any portion of the Site, or to permit Participant to 6 assign or be relieved of any of its obligations under this 7 Agreement pertaining to any portion of the Site, which portion is 8 not yet the subject of a Certificate of Completion (i.e., in 9 violation of any other provision of this Agreement expressly 10 forbidding the same), it being understood and agreed that any 11 deviation from provisions prohibiting the same shall be the 12 subject of separate inquiry by Agency under the terms of this 13 Agreement. 14 15 7. Failure of Participant to timely and fully pay any 16 and all property taxes which may be levied against the Site (and 17 which are not otherwise the subject of Participant's contest , 18 thereof) shall constitute a default by Participant under the 19 terms of this Section 405 and this Agreement. 20 21 F. [§406] Waiver of Riqht to Protest Formation of 22 District 23 24 Participant covenants and agrees, for itself, its 25 successors, its assigns and every successor in interest, that 26 should either City or Agency seek to form an assessment district, 27 community facilities district or similar entity or area RBKIAGMT\141931.8 -50- II!: -~-y 10/09/97 I 1o07am . - or " 1 designation (in any case, an "Assessment District") to include 2 the Site and provide for the assessing of assessments, levying of 3 special taxes or imposition of similar cost or fee (in any case, 4 "Assessments") for the purposes of the satisfaction of all or any' 5 portion of the Project Measures (as defined in Section 314, 6 above) other than the Municipal Code Requirements, Participant 7 shall not oppose the formation of, or levying of Assessments by, 8 such Assessment District and shall, if an election or hearing is 9 called or held, cast its vote in favor, or otherwise indicate its 10 approval, thereof; provided, however, that in no event shall 11 Participant hereby be deemed to have waived any right it may have 12 to protest any inequitable allocation or spreading (if 13 applicable) of Assessments which are applicable to the Site. 14 15 G. [§407] . Effect and Duration of Covenants 16 17 Except as otherwise provided, the covenants contained . 18 in this Agreement and the Deed shall remain in effect until 19 December 31, 2028. The covenants against discrimination shall 20 remain in effect in perpetuity. As stated in Section 401, the 21 covenants of that Section requiring use of the Site for Medical 22 Services shall expire on December 31, 2014. The covenants 23 established in this Agreement and the Deed shall, without regard 24 to technical classification and designation, be binding for the 25 benefit and in favor of Agency, its successors and assigns, City 26 and any successor in interest to the Site or any part thereof. 27 RBK\AGMT\141931.8 -51- E-~ 10/09/9711o07am - - .,- 1 Agency is deemed the beneficiary of the terms and 2 provisions of this Agreement and of the covenants running with 3 the land for and in its own right and for the purposes of 4 protecting the interests of the community and other parties, 5 public or private, in whose favor and for whose benefit this 6 Agreement and the covenants running with the land have been 7 provided. This Agreement and the covenants shall run in favor of 8 Agency without regard to whether Agency has been, remains or is 9 an owner of any land or interest therein in the Site, any parcel 10 or subparcel, or in the Project Area. Agency shall have the 11 right, if this Agreement or the covenants are breached, to 12 exercise all rights and remedies and to maintain any actions or 13 suits at law or in equity or other proper proceedings to enforce 14 the curing of such breaches to which it or any other 15 beneficiaries of t~is Agreement and the covenants may be 16 entitled. 17 , 18 H. [§408] Riqhts of Access - Public Improvements and 19 Facilities 20 21 Agency, for itself and for City and other public 22 agencies at their sole risk and expense, reserves the right to 23 enter the Site or any part thereof at all reasonable times and 24 with as little interference a~ possible for the purposes of 25 construction, reconstruction, maintenance, repair or service of 26 any public improvements or public facilities located on the Site. 27 Any such entry shall be made only after reasonable notice to RBK\AGMT\141931.8 -52- E- STo 1O/(J9/97 [[007"" - . 1 Participant, and, with respect to entries by Agency, Agency shall 2 indemnify and hold Participant and its officers, employees, 3 agents, invitees and contractors harmless from any and all 4 actions, demands, claims, obligations, liabilities, losses, 5 expenses, costs and damages pertaining to such entry by Agency, 6 except to the extent any such damage or injury arises as a result 7 of the negligence or willful misconduct of Participant or its 8 officers, agents, employees invitees or contractors. Such 9 obligation to indemnify and hold harmless shall survive the 10 termination of this Agreement regardless of the reason for such 11 termination. Any damage or injury to the Site resulting from 12 such entry shall be promptly repaired at the sole expense of the 13 public agency responsible for the entry, except to the extent any 14 such damage or injury arises as a result of the negligence or 15 willful misconduct ,of Participant or its officers, agents, 16 employees, invitees or contractors. 17 . 18 V. [§500] DEFAULTS, REMEDIES AND TERMINATION 19 20 A. [§50l] Defaults - General 21 22 Subject to the extensions of time set forth in Section 23 604, failure or delay by either party to perform any material 24 te.rm or provision of this Agr'eement constitutes a default under 25 this Agreement. The party who so fails or delays must 26 immediately commence to cure, correct or remedy such failure or 27 delay and shall complete such cure, correction or remedy with RBK\AGMT\141931.8 -53- £-S"? 10/09/97 11:07am ..- 1 reasonable diligence and during any period of curing shall not be 2 in default. 3 4 The injured party shall give written notice of default 5 to the party in default specifying the default complained of by 6 the injured party. Except as required to protect against further 7 damages, the injured party may not institute proceedings against 8 the party in default or take actions to terminate until thirty 9 (30) days after giving such notice. Failure or delay in giving 10 such notice shall not constitute a waiver of any default nor 11 shall it change the time of default. 12 13 Except as otherwise expressly provided in this 14 Agreement, any failure or delay by either party in asserting any 15 of its rights or remedies as to any default shall not operate as 16 a waiver of any default or of any such rights or remedies or 17 deprive such party of its right to institute and maintain any . 18 actions or proceedings which it may deem necessary to protect, 19 assert or enforce any such rights or remedies. 20 21 B. [§502]. Leqal Actions 22 23 1. [§503] Institution of Leqal Actions 24 25 In addition to any other rights or remedies, 26 either party may institute action to cure, correct or remedy any 27 default, or recover damages for any default, or to obtain any RBKIAGM'!\141931.8 -54- E -~-V 10/09/97 II.07am 1 other remedy (including specific performance) consistent with the 2 purpose of this Agreement. Such actions must be maintained 3 pursuant to Section 607 below. 4 5 2. [§504] Applicable Law 6 7 The laws of the State of California shall govern 8 the interpretation and enforcement of this Agreement. 9 10 3. [§505] Acceptance of Service of Process 11 12 In the event that any legal action is commenced by 13 Participant against Agency, service of process on Agency shall be 14 made by personal service upon the Executive Director of Agency or 15 in such other manner as may be provided by law. 16 17 In the event that any legal action is commenced by . 18 Agency against Participant, service of process on Participant 19 shall be made by personal service upon either the Chief Executive 20 Officer, the Chief Operating Officer, or the Chief Financial 21 Officer of Scripps Health and the Administrator of Scripps 22 Memorial Hospital - Chula Vista, or in such other manner as may 23 be provided by law and shall be valid whether made within or 24 without the State of California. 25 26 27 RBK\AGMT\141931.8 -55- £ -~--v 10/09/97 l1o07:un 1 C. [§506] Riqhts and Remedies are Cumulative 2 3 Except as otherwise expressly stated in this Agreement, 4 the rights and remedies of the parties are cumulative, and the 5 exercise by any party of one or more of such rights or remedies 6 shall not preclude the exercise by it, at the same time or 7 different times, of any other rights or remedies for the same 8 default or any other default by the other party. 9 10 D. [§507] Mutual Release 11 12 1. [§508] Release of Aqencv and Citv 13 14 For and in consideration of the promises and 15 covenants set fort~ in this Agreement, Participant, for itself, 16 its successors, assigns and any and all persons claiming through 17 or under it, hereby releases and forever discharges Agency, City . 18 and their respective officers, employees, insurers and assigns, 19 agents, attorneys, and all persons acting by and through, under 20 or in concert with them, of and from any and all claims, demands, 21 claims for relief, obligations, rights, and/or liabilities of any 22 nature, whether anticipated or unanticipated, known or unknown, 23 fixed or contingent, past or present (hereinafter referred to as 24 "Claims"), which Participant now has against Agency, City or 25 their respective officers, employees, insurers and assigns, 26 agents, attorneys, or any persons acting by and through, under or 27 in concert with them, arising out of or in connection with the RBK\AGM1\141931.8 -56- £' - reo 1O/œ/97 11.O1am 1 Prior Agreement, including, without limitation, the performance 2 of Agency and City under the Prior Agreement up to and including 3 the Execution Date. 4 5 PARTICIPANT REPRESENTS, ACKNOWLEDGES AND AGREES 6 THAT IT HAS BEEN ADVISED BY ITS LEGAL COUNSEL OF, AND IS FAMILIAR 7 WITH, THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1542, WHICH 8 PROVIDES AS FOLLOWS: 9 10 "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH 11 THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN 12 HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, 13 WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY 14 AFFECTED HIS SETTLEMENT WITH DEBTOR." 15 16 PARTICIPANT SPECIFICALLY WAIVES ANY AND ALL RIGHTS AND/OR 17 BENEFITS WHICH IT MAY HAVE UNDER CALIFORNIA CIVIL CODE . 18 SECTION 1542, OR ANY OTHER STATUTE OR COMMON LAW PRINCIPLES OF 19 SIMILAR SUBSTANCE AND EFFECT, WITH RESPECT TO THE MATTERS 20 RELEASED PURSUANT TO THIS AGREEMENT AND REPRESENTS, ACKNOWLEDGES 21 AND AGREES THAT THE KNOWING AND VOLUNTARY WAIVER OF THE 22 PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1542 IS AN ESSENTIAL 23 AND MATERIAL TERM OF THIS AGREEMENT, AND ACKNOWLEDGES THAT 24 WITHOUT SUCH A WAIVER, AGENC~ WOULD NOT HAVE ENTERED INTO THE 25 AGREEMENT. 26 27 RBKIAGM1\141931.8 -57- E-fol 10/09/97 11 :07"" - - or 1 2. [§509] Release of Participant 2 3 For and in consideration of the promises and 4 covenants set forth in this Agreement, Agency for itself, its 5 successors, assigns and any and all persons claiming through or 6 under it, hereby releases and forever discharges Participant and 7 its affiliates, successors, related entities, insurers and 8 assigns, members, trustees, officers, employees, agents, 9 attorneys, and all persons acting by and through, under or in 10 concert with it, of and from any and all claims, demands, claims, 11 for relief, obligations, rights, and/or liabilities of any 12 nature, whether anticipated or unanticipated, known or unknown, 13 fixed or contingent, past or present (hereinafter referred to as 14 "Claims"), which Agency now has against Participant or its 15 respective affiliates, related entities, insurers and assigns, 16 members, trustees, officers, employees, agents, attorneys, or any 17 persons acting by and through, under or in concert with it, , 18 arising out of or in connection with the Prior Agreement, 19 including, without limitation, the performance of Participant 20 under the Prior Agreement up to and including the Execution Date. 21 22 AGENCY REPRESENTS, ACKNOWLEDGES AND AGREES THAT IT 23 HAS BEEN ADVISED BY ITS LEGAL COUNSEL OF, AND IS FAMILIAR WITH, 24 THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1542, WHICH 25 PROVIDES AS FOLLOWS: 26 27 RBKIAGM1\14193I.8 -58- E-'-;J.. 10/09/97 11 :07"" - - - T 1 "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH 2 THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN 3 HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, 4 WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY 5 AFFECTED HIS SETTLEMENT WITH DEBTOR." 6 7 AGENCY SPECIFICALLY WAIVES ANY AND ALL RIGHTS AND/OR BENEFITS 8 WHICH IT MAY HAVE UNDER CALIFORNIA CIVIL CODE SECTION 1542, OR 9 ANY OTHER STATUTE OR COMMON LAW PRINCIPLES OF SIMILAR SUBSTANCE 10 AND EFFECT, WITH RESPECT TO THE MATTERS RELEASED PURSUANT TO THIS 11 AGREEMENT AND REPRESENTS, ACKNOWLEDGES AND AGREES THAT THE 12 KNOWING AND VOLUNTARY WAIVER OF THE PROVISIONS OF CALIFORNIA 13 CIVIL CODE SECTION 1542 IS AN ESSENTIAL AND MATERIAL TERM OF THE 14 AGREEMENT, AND ACKNOWLEDGES THAT WITHOUT SUCH A WAIVER, 15 PARTICIPANT WOULD NOT HAVE ENTERED INTO THE AGREEMENT. 16 17 3. [§510] No Assiqnment , 18 19 Agency and Participant each represent and warrant 20 to the other party that there has been no assignment or other 21 transfer to any other person, firm or corporation in any manner, 22 including by way of subrogation or operation of law or otherwise, 23 of all or any portion of any claim, demand, right, action or 24 claim for relief that it had,. has or might have arising out of 25 the matters released in this Agreement, nor of all or any portion 26 of any recovery or settlement to which it may be entitled. In 27 the event that any claim, demand or suit should be made or RBKIAGMT\141931.8 -59- £-~3 10/09/97 11 :07am 1 instituted against a party because of any such purported 2 assignment, subrogation or transfer, each party agrees to 3 indemnify and hold the other party harmless against such claims, 4 demand or suit, together with any costs, expenses and attorneys' 5 fees incurred by the other party as a result of any person's 6 assertion of any such assignment or transfer. 7 8 VI. [§600] GENERAL PROVISIONS 9 10 A. [§601] Notices of Demands and Communications Between 11 the Parties 12 13 Formal notices, demands and communications between 14 Agency and Participant shall be sufficiently given if 15 (i) delivered pers~nally, (ii) sent via Federal Express (or other 16 messenger service), or (iii) dispatched by registered or 17 certified mail, postage prepaid, return receipt requested, to the . 18 principal offices of Agency (Attn: General Counsel) and 19 Participant (Attn: General Counsel) and their respective counsel 20 as set forth in Sections 106 and 107 hereof (and/or to such other 21 addresses as either party may from time to time designate in 22 writing). Personally delivered notices shall be deemed given 23 upon actual personal delivery to the above address. Notices sent 24 via Federal Express (or other messenger service) shall be deemed 25 given upon delivery to the above address (as evidenced by the 26 receipt of the delivery service). Mailed notices shall be deemed 27 given upon the earlier of three (3) business days after deposit RBK\AGM1\141931.8 -60- E-"C¡ 10/09/9711.07am 1 into the United States mail, registered or certified, with 2 postage fully prepaid, or the date of actual receipt as evidenced 3 by the return receipt. All such notices, etc. to Participant 4 shall also be delivered to Scripps Memorial Hospital, 435 H 5 Street, Chula Vista, California 92010, Attention: 6 Administrator. 7 8 B. [§602] Conflicts of Interest 9 10 No member, official or employee of Agency shall have 11 any personal interest, direct or indirect, in this Agreement, nor 12 shall any such member official or employee participate in any 13 decision relating to this Agreement which affects his personal 14 interests or the interests of any corporation, partnership or, 15 association in which he is directly or indirectly interested. 16 17 Participant warrants that it has not paid or given, and . 18 will not payor give, any third person any money or other 19 consideration for obtaining this Agreement. This warranty shall 20 not be deemed to prohibit the payment of professional fees to 21 attorneys, architects, engineers and other professional 22 consultants who assist Participant in the negotiation of this 23 Agreement or the planning and development of the Project. 24 25 26 27 RBKIAGMT\141931.8 -61- £-,r 10/09/97 II :07am - - -- 1 c. [§603] Non-Liability of Aqency Officials and 2 Employees 3 4 No member, official or employee of Agency shall be 5 personally liable to Participant in the event of any default or 6 breach by Agency or for any amount which may become due to 7 Participant or on any obligations under the terms of this 8 Agreement. 9 10 D. [§604] Enforced Delav: Extension of Times of 11 Performance 12 13 In addition to the specific provisions of this 14 Agreement, performance by any party hereunder shall not be deemed 15 to be in default where delays or defaults are due to war; 16 insurrection; strikes; lock-outs; riots; floods; earthquakes; 17 fires; casualties; acts of God; acts of public enemy; epidemics; . 18 quarantine restrictions; freight embargoes; lack of 19 transportation; governmental restrictions or priority; 20 litigation, including delays beyond the reasonable control of 21 Agency, in concluding eminent domain proceedings or related legal 22 proceedings instituted by Agency to acquire and vacate the Site 23 or portions thereof; unusually severe weather; inability to 24 secure necessary labor, materáals or tools; delays of any 25 contractor, subcontractor or supplier; acts of another party; 26 acts or the failure to act of any public or governmental agency 27 or entity (except that acts or the failure to act of Agency or RBK\AGMT\I41931.8 -62- £-,~ 10/09/9711,07"" 1 City shall not excuse performance by Agency) or any other causes 2 beyond the control or without the fault of the party claiming an 3 extension of time to perform. An extension of time for any such 4 cause shall only be for the period of the enforced delay (which 5 period shall commence to run from the time of the commencement of 6 the cause), and only to the extent such period of delay actually 7 causes delay in such performance. If, however, notice by the 8 party claiming such extension is sent to the other parties more 9 than thirty (30) days after the commencement of the cause, the 10 period shall commence to run only thirty (30) days prior to the 11 giving of such notice. Times of performance under this Agreement 12 may also be extended in writing by Agency and Participant. 13 14 E. [§605] Inspection of Books and Records 15 16 Agency has the right, upon not less than seventy-two 17 (72) hours notice, at all reasonable times, to inspect the books . 18 and records of Participant pertaining to the Site as pertinent to 19 the purposes of this Agreement. 20 21 Participant also has the right, upon not less than 22 seventy-two (72) hours notice, at all reasonable times, to 23 inspect the books and records of Agency pertaining to the Site as 24 pertinent to the purposes of this Agreement. 25 26 27 RBKIAGMT\141931 ,8 -63- E -" 7 10/09/97 11:07am - - -, - 1 F. [§606] Plans and Data 2 3 If this Agreement is terminated for any reason other 4 than a default by Agency, Participant shall immediately 5 thereafter deliver to Agency any and all plans, studies, reports 6 and data concerning the Site, and Agency or any other person or 7 entity designated by Agency shall be free to use such plans, 8 studies, reports and data, including plans, studies, reports and 9 data previously delivered to Agency, for any reason whatsoever 10 without cost or liability therefor to Participant or any other 11 person. This obligation shall not extend to internal reports 12 prepared by Participant, plans, reports or other documents 13 prepared by the architect of the Project and reports or portions 14 of reports containing confidential or proprietary information. 15 Matters relating to the physical characteristics of the Site, 16 ownership interests in the Site, environmental documentation and 17 other related items, shall not be considered proprietary. . 18 19 G. [§607] Reference 20 21 Each controversy, dispute or claim between the parties 22 arising out of or relating to this Agreement, which controversy, 23 dispute or claim is not settled in writing within thirty 24 (30) days after the "Claim Date" (as hereinafter defined), will 25 be settled by a reference proceeding in San Diego County, 26 California in accordance with the provisions of Section 638 et 27 .ê.§g. of the California Code of Civil Procedure, or their RBKIAGMT\141931.8 -64- £-~f' 10/09/97 1 W7am 1 successor sections ("CCP") , which shall constitute the exclusive 2 remedy for the settlement of any controversy, dispute or claim 3 concerning this Agreement, including whether such controversy, 4 dispute or claim is subject to the reference proceeding and the 5 parties waive their rights to initiate any legal proceedings 6 against each other in any court or jurisdiction other than the 7 Superior Court of San Diego County (the "Court"). The referee 8 ("Referee") shall be a retired Judge of the Court selected by 9 mutual agreement of the parties, and if they cannot so agree 10 within forty-five (45) days after the Claim Date, the Referee 11 shall be promptly selected by the Presiding Judge of the 12 San Diego County Superior Court (or his representative). The 13 date on which the Referee is selected is herein called the 14 "Selection Date." The Referee shall be appointed to sit as a 15 temporary judge, with all of the powers of a temporary judge, as 16 authorized by law, and upon selection should take and subscribe 17 to the oath of office as provided for in Rule 244 of the . 18 California Rules of Court (or any subsequently enacted Rule). 19 The Referee shall set the matter for hearing within sixty 20 (60) days after the Selection Date, and try any and all issues of 21 law or fact and report a statement of decision upon them, if 22 possible, within ninety (90) days of the Selection Date. Any 23 decision rendered by the reference will be final, binding and 24 conclusive and judgment shall be entered pursuant to CCP 644 in 25 any court in the State of California having jurisdiction. Either 26 party may apply for a reference at any time after thirty (30) 27 days following the date (the "Claim Date") one party notifies the RBK\AGMT\141931.8 -65- £-'f 10/09/97 lL07am - . - í 1 other party of a controversy, dispute or claim; by filing a 2 petition for a hearing and/or trial. All discovery permitted by 3 this Agreement (as more particularly provided below), shall be 4 completed no later than fifteen (15) days before the first 5 hearing date established by the Referee. The Referee may extend 6 such period in the event of a party's refusal to provide 7 requested discovery for any reason whatsoever, including, without 8 limitation, legal objections raised to such discovery or 9 unavailability of a witness due to absence or illness. No party 10 shall be entitled to "priority" in conducting discovery. 11 Depositions of a party or its affiliates may be taken by the 12 other party upon seven (7) days written notice, and, request for 13 production or inspection of documents on a party or its 14 affiliates shall be responded to within ten (10) days after 15 service. All disp~tes relating to discovery which cannot be 16 resolved by the parties shall be submitted to the Referee whose 17 decision shall be final and binding upon the parties. , 18 19 Except as expressly set forth in this Agreement, the 20 Referee shall determine the manner in which the reference 21 proceeding is conducted including the time and place of all 22 hearings, the order or presentation of evidence, and all other, 23 questions that arise with respect to the course of the reference 24 proceeding. All proceedings ctnd hearings conducted before the 25 Referee, except for trial, shall be conducted without a court 26 reporter, except that when any party so requests, a court 27 reporter will be used at any hearing conducted before the RBKIAGM'I\141931.8 -66- /:-70 10109/97 11007"" - . .. - 1 Referee. The party making such a request shall have the 2 obligation to arrange for and pay for the court reporter. The 3 costs of the court reporter at the trial shall be borne equally 4 by the parties. 5 6 The Referee shall be required to determine all issues 7 in accordance with existing case law and the statutory laws of 8 the State of California. The rules of evidence applicable to 9 proceedings at law in the State of California will be,applicable 10 to the reference proceeding. The Referee shall be empowered to 11 enter equitable as well as legal relief, to provide all temporary 12 and/or provisional remedies and to enter equitable orders that 13 will be binding upon the parties. The Referee shall issue a 14 single judgment at the close of- the reference proceeding which 15 shall dispose of a~l of the claims of the parties that are the 16 subject of the reference. The parties hereto expressly reserve 17 the right to findings of fact, conclusions of law, and a written . 18 statement of decision. 19 20 ARBITRATION OF DISPUTES 21 22 IN THE EVENT THAT THE ENABLING LEGISLATION WHICH 23 PROVIDES FOR APPOINTMENT OF A REFEREE IS REPEALED (AND NO 24 SUCCESSOR STATUTE IS ENACTED)., ANY DISPUTE BETWEEN THE PARTIES 25 THAT WOULD OTHERWISE BE DETERMINED BY THE REFERENCED PROCEDURE 26 HEREIN DESCRIBED WILL BE RESOLVED AND DETERMINED BY ARBITRATION. 27 THE ARBITRATION WILL BE CONDUCTED BY A RETIRED JUDGE OF THE RBK\AGM1\141931.8 -67- E-7( 10/09/97 11o07am - - -- 0.. 1 COURT, IN ACCORDANCE WITH THE CALIFORNIA ARBITRATION ACT, SECTION 2 1280 AND 1294.2 OF THE CCP AS AMENDED FROM TIME TO TIME; 3 PROVIDED, HOWEVER, THAT NOTWITHSTANDING ANY PROVISION TO THE 4 CONTRARY REGARDING DISCOVERY SET FORTH IN THE CALIFORNIA 5 ARBITRATION ACT, THE RIGHTS AND LIMITATIONS WITH RESPECT TO 6 DISCOVERY AS SET FORTH HEREINABOVE SHALL APPLY TO ANY SUCH 7 ARBITRATION PROCEEDING. 8 9 "NOTICE: BY INITIALLING IN THE SPACE BELOW YOU ARE 10 AGREEING TO HAVE ANY DISPUTE ARISING OUT OF THE MATTERS INCLUDED 11 IN THE 'ARBITRATION OF DISPUTES' PROVISION DECIDED BY NEUTRAL 12 ARBITRATION AS PROVIDED BY CALIFORNIA LAW AND YOU ARE GIVING UP 13 ANY RIGHTS YOU MIGHT POSSESS TO HAVE THE DISPUTE LITIGATED IN A 14 COURT OR JURY TRIAL. BY INITIALLING IN THE SPACE BELOW YOU ARE 15 GIVING UP YOUR JUD~CIAL RIGHTS TO DISCOVERY AND APPEAL, UNLESS 16 THOSE RIGHTS ARE SPECIFICALLY INCLUDED IN THE 'ARBITRATION OF 17 DISPUTES' PROVISION. IF YOU REFUSE TO SUBMIT TO ARBITRATION . 18 AFTER AGREEING TO THIS PROVISION, YOU MAY BE COMPELLED TO 19 ARBITRATE UNDER THE AUTHORITY OF THE CALIFORNIA CODE OF CIVIL 20 PROCEDURE. YOUR AGREEMENT TO THIS ARBITRATION PROVISION IS 21 VOLUNTARY." "WE HAVE READ AND UNDERSTAND THE FOREGOING AND AGREE 22 TO SUBMIT DISPUTES ARISING OUT OF THE MATTERS INCLUDED IN THE 23 'ARBITRATION OF DISPUTES' PROVISION TO NEUTRAL ARBITRATION." 24 25 AGENCY PARTICIPANT 26 27 RBKIAGM1\14193 1.8 -68- £ -7 if}.. 10/O9/971L07am 1 H. [§608] Indemnities 2 3 No indemnity given by Agency under this Agreement shall 4 be construed as including any obligation to defend or to pay (or 5 reimburse) the costs of any defense. All indemnities given by 6 Participant under this Agreement shall include the obligation to 7 defend and to pay (and/or reimburse) the reasonable costs of any 8 good faith defense. 9 10 I. [§609] Attornevs' Fees 11 12 In the event of any conflict or dispute with respect to 13 the interpretation or enforcement of any of the terms or 14 provisions of this Agreement, the prevailing party shall be 15 entitled to recove~ from the other party all of its costs and 16 expenses reasonably incurred in connection therewith, including, 17 without limitation, attorneys' fees. . 18 19 VII. [§700] SPECIAL PROVISIONS 20 21 A. [§701] Amendment of Redevelopment Plan 22 23 Pursuant to provisions of the Redevelopment Plan for 24 modification or amendment thereof, Agency agrees that no 25 amendment which changes the uses or development permitted on the 26 Site or changes the restrictions or controls that apply to the 27 Site or otherwise materially and adversely affect the development RBK\AGMTlI41931.8 -69- £-73 10/09/97 11:07am - - 1 of the Site pursuant to this Agreement, shall be made or become 2 effective without the prior written consent of Participant. 3 Amendments to the Redevelopment Plan applying to other property 4 in the Project Area shall not require the consent of Participant 5 except to the extent that such amendments would materially and 6 adversely affect the construction, use, development or economic 7 feasibility of the Project. 8 9 B. [§702] Amendments to this Aqreement 10 11 Participant and Agency agree to mutually consider 12 reasonable requests for amendments to this Agreement which may be 13 made by any of the parties hereto, lending institutions, bond 14 counselor financial consultants to Agency, provided such 15 requests are consistent with this Agreement and would not 16 substantially alter the basic business terms included herein. 17 . 18 c. [§703] Implementation Aqreements 19 20 Minor technical changes, corrections and clarifications 21 or agreements implementing the provisions of this Agreement which 22 do not substantively change the terms of this Agreement, or 23 changes to the Schedule of Performance (Attachment No. 5), may be 24 made by writing executed by Participant and the Executive 25 Director of Agency or designee upon approval of Agency's general 26 counsel. 27 RBK\AGM1\141931.8 -70- E-7{ 10/09/97 11 :07am - - --- I 1 VIII. [§800] ENTIRE AGREEMENT, WAIVER AND AMENDMENTS 2 3 This Agreement is executed in five (5) duplicate 4 originals, each of which is deemed to be an original. This 5 Agreement comprises pages 1 through 72, inclusive, and 6 Attachments No. 1 through 7, attached hereto and incorporated 7 herein by reference, all of which constitute the entire 8 understanding and agreement of the parties. 9 10 This Agreement integrates all of the terms and 11 conditions mentioned herein or incidental hereto, and supersedes 12 all negotiations or previous agreements between the parties with 13 respect to all or any part of the subject matter hereof. 14 15 All waivers of the provisions of this Agreement must be 16 in writing and signed by the appropriate authorities of Agency 17 and Participant, and all amendments hereto must be in writing and , 18 signed by the appropriate authorities of Agency and Participant. 19 20 IX. [§900] TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY 21 22 This Agreement, when executed by Participant and 23 delivered to Agency, must be authorized, executed and delivered 24 by Agency within thirty (30) Àays after the Execution Date or 25 this Agreement shall be void, except to the extent that 26 Participant shall consent in writing to further extensions of 27 time for the authorization, execution and delivery of this RBKIAGM'1\141931.8 -71- € -7 S- 10/09/97 11007"" 1 Agreement. By executing this Agreement and submitting it to 2 Agency, Participant is making an irrevocable offer to enter into 3 this Agreement, which offer shall continue for the period of time 4 specified above. The effective date of this Agreement shall be 5 the date when this Agreement has been signed by Agency. 6 , 19 - REDEVELOPMENT AGENCY OF 7 THE CITY OF CHULA VISTA, a public body, corporate 8 and politic 9 By 10 CHAIRMAN 11 "AGENCY" 12 13 APPROVED AS TO FORM: 14 15 John M. Kaheny, Ese¡:. Agency General Counsel 16 17 , 199 - SCRIPPS HEALTH, a California . 18 non-profit public benefit corporation 19 20 By 21 Its 22 "PARTICIPANT" 23 24 25 26 27 RBK\AGMT\141931.8 -72 - £-7(. 10/09/97 1 L07"" - - oW - , 1 ATTACHMENT NO. 1 2 TownCentre II Prolect Area Map 3 4 Attached is a depiction of the entire Project Area, as amended 5 by the second Plan amendment. 6 7 8 9 10 11 12 13 14 15 16 17 . 18 19 20 21 22 23 24 25 26 27 £-11 RBKIAGM1\141931.8 10/09/97 11007"" . - ... \~ "J / --í... ,y- --- - ------ - /' ¡ \ I I ~" -, 'j ¡- ~ ¡\ /'.- ~::._., ","","... ~-: c",. ,~, ,/ - - < ~/ ----- ~ ~ " -,- ',' - - ,- \ ,- - ----, ' , \1 -'\':~ / ,- ,-- \. ' -, '---... "..-:~.... ,-- -- .- r. I, \ \ ; ~ ' ,\ . \ ~ " i ~ \~- l -- - ,,';:-- C-¡ , ' ' '\ UL , =_1!l. -,-:L. ~ ^.'. =~MeNDMI!NT ARIA CITY OF 01ULA VISTA REDEVE!..CPMENT AGENCY--'~-=' U BOUNDARY ...- _,, .- I.; -CO" - ~ m .. ","-,-". ",- L.. ----=--.... AaeCNlNrAAEA .'. EXISTINGPIIOJECTAREA ~;!;IfEY ... ,.- . . - - ' - 1 ATTACHMENT NO. 2 2 Site Map 3 4 Attached are separate depictions of the Site as developed by the 5 First and Ultimate Phases. 6 7 8 9 10 11 12 13 14 15 16 17 . 18 19 20 21 22 23 24 25 26 27 RBKIAGMT\141931.8 £-79 1O/O9/9711:07arn - - II '[:1 í i í Gi 1\ ':' , ' III " ,- ~ < . I,) .¡!Iæ¡¡i ¡¡EB-,i~~ ~",ž; I ¡¡I! i. , i'rÌ II ' if ro ~ ¡ , ~I¡; i ! r I lI!hl ! : ' " :i I ";.. "InD< co ' ;; :I: U I ,i!'! ¡ LJ œ 6 . e = ::." <, ",,: "~ ~ ~ ',~I\.L--' ~9=f-' '" -, I ~ " ><5 I ~~r!]lln:¡~f~"= I~'~^' i I' j ;' , 1'=: , II ¡ 'f:: ILJ' I! i I .. , ' , ' !~ l I !! "I', . ~ I ~;: ~I~ ", I ] ,J ¡¡ii,'; l' , .1 !" 'I' . ill Ii II , I ~ ~ II hI , ~ . oX Ii I I. ! !' I"!'!'!','I', ¡, . ~ ¡¡lill: I ,j,l ;: ~ ( ¡li!il'l'i ~ I i , [I, I'I'!"I' I '"I'" 'I" I I'" . , '" ¡; ,i, ' I i 1!¡!!!I!lbl ' ! I I:il,;i;i¡¡ II I 'i ~ ]' !: , .",," . , ¡"',"'I' I " ",I,!,i; I i,I!:,:"il,; , ,i!!. ' : ~ " ¡i!!"I!!n,!¡ 11""1 !ìl,¡,;¡!!d 11::,." . --- I"~ ,¡i""':" li~Ui¡ : I~--- -~~~"3^,:"-L-,~olr--m-r ! ~;', ' ,~.~~ !~¡! ~.~ r' ~oolt. "]Iî""-""'"'--~"';'~Ú;" ~=L";;;"'~""",. - '...... -~:;;;~ o. lie ; ~. !!.. i i -- '.1 jl' . .0 " :" : w ~ 11 I U II: R~ z 0.5 ~c 5 w u 0 , ~ [J) ¡; ¡ (~~;) .~ ',~.. - "",,'1ií¡ 1 ATTACHMENT NO. 3 2 Leqal Description of Site 3 4 THE WEST HALF OF THE TEN ACRE LOTS 13 AND 14 IN QUARTER SECTION 148 OF CHULA VISTA, IN THE CITY OF CHULA VISTA, COUNT OF SAN 5 DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 505, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, 6 MARCH 13, 1888. EXCEPTING THEREFROM ALL THAT PORTION OF SAID LOT 13 AS GRANTED TO THE CITY OF CHULA VISTA, IN DEED RECORDED 7 AUGUST 9, 1968 AS FILED NO. 136346 OF OFFICIAL RECORDS, AND MORE PARTICULARLY DESCRIBED AS FOLLOWS: 8 THAT PORTION OF SAID LOT 13, LYING SOUTHERLY AND WESTERLY OF THE 9 ARC OF A 24.00 FOOT RADIUS CURVE, CONCAVE NORTHEASTERLY AND TANGENT TO THE SOUTHERLY LINE OF SAID LOT 13 (BEING THE NORTHERLY 10 LINE OF "H" STREET) AND THE WESTERLY LINE OF SAID LOT 13 (BEING THE EASTERLY LINE OF FIFTH AVENUE, FORMERLY KNOWN AS FIRST 11 AVENUE). 12 13 14 15 16 17 . 18 19 20 21 22 23 24 25 26 27 RBKlAGMTl141931.8 £ -~ d- 10/09/97 11:07"" - - 1 ATTACHMENT NO. 4 2 Scope of Development 3 4 See Site Map (Attachment No. 2) 5 6 7 8 9 10 11 12 13 14 15 16 17 , 18 19 20 21 22 23 24 25 26 27 RBK\AGM1\141931.8 F- -~ 3 10/09/9711:07= - - -- 1 ATTACHMENT NO.5 2 Schedule of Performance 3 4 ACTION DATB 5 Submittal of Basic Concept Completed. 6 Drawinqs. Participant shall submit basic 7 concept drawings and preliminary landscaping plans 8 (Sections 108 and 1170) . 9 Environmental Review and Completed. Section 33431 Hearinq. 10 The conditions precedent set forth in Sections 109 and 115 11 shall be satisfied. Execution of Aqreement bv Within thirty (30) days after 12 Aqency. execution and delivery of this Agency and City Council shall Agreement by Participant, but 13 hold a public hearing to in no event prior to the authorize execution of this satisfaction of all conditions 14 Agreement by Agency, and, if precedent. so authorized, Agency shall 15 execute and deliver this Agreement to Participant 16 (Sections 108 and 900). 17 Submittal of Application for Completed. Parcel Map. , 18 Participant shall file a complete application for the 19 Parcel Map with the City of Chula Vista (Section 314). 20 Approval by City of Parcel Within six (6) months after ~. submission by Participant of 21 The City of Chula Vista shall the complete application for 22 have approved or disapproved the Parcel Map. the Parcel Map (Section 314). 23 Submittal of Cancer Center Within six (6) months after Plans. Participant shall the execution of this 24 submi t the Cancer Center Agreement by Agency. construction plans, including 25 landscaping and grading plans to the City Building and 26 Housing Department, and Agency for plan review and approval 27 (Section 304) . RBK\AGM1\141931.8 -1- E -fief 1O/O9/9711:07am I 1 ACTION DATB 2 Approval of Cancer Center Within four (4) months after 3 Plans. the submission to the City The City Building and Housing Building and Housing 4 Department and Agency shall Department and Agency of the have finally approved or Cancer Center plans. 5 disapproved the Cancer Center plans. Subject to Agency's 6 obligations under Article III, Participant shall bear full 7 responsibility to obtain final approval in a timely manner. 8 Commencement of Construction Within sixty (60) days of 9 of the Cancer Center Participant's receipt of all Improvements. required approvals of the 10 Participant shall commence Cancer Center Building Plans. construction of the Cancer 11 Center improvements (Section 307). 12 Completion of Construction of Within fourteen (14) months the Cancer Center after commencement of 13 Improvements. construction. Participant shall complete 14 construction of the Cancer Center improvements 15 (Section 307). 16 Submittal of Phase One Completed. Hospital Plans. 17 Participant shall submit the . Phase One hospital 18 construction plans, including landscaping and grading plans, 19 to the State of California (Office of Statewide Health 20 Planning and Development), the City Building and Housing 21 Department, and Agency for plan review and approval 22 (Section 304). 23 24 25 26 27 - RBKIAGM1\14193\.8 -2 - E-ý~ 10/09/97 [[ :07am - - ... 1 ACTJ:ON DATI!: 2 Approval of Phase One Hospital Within eight (8) months after 3 Plans. submission to the State of The State of California, the California, the City Building 4 City Building and Housing and Housing Department, and Department, and Agency shall Agency of the Phase One 5 have finally approved or hospital plan. disapproved the Phase One 6 hospital plans. Subject to Agency's obligations under 7 Article III, Participant shall bear full responsibility to 8 obtain final approval in a timely manner. 9 Submission of Evidence of Within thirty (30) days of 10 Eauitv or Financina. Participant's receipt of all Participant shall submit to required approvals of Phase 11 Agency evidence of equity or One hospital plans from the financing, as required by State of California, the City 12 Section 307A, to develop the Building and Housing Phase One hospital Department, and Agency. 13 improvements. Commencement of Construction Within four (4) months after 14 of Phase One Hospital receipt of all required Improvements. approvals of Phase One 15 The Participant shall commence hospital plans from the State construction of Phase One of California, the City 16 hospital improvements Building and Housing (Section 307). Department, and Agency, and 17 the submittal of Evidence of . Equity or Financing. 18 Completion of Construction of Within twenty-four (24) months 19 Phase One Hospital after commencement of Improvements. construction. 20 Participant shall complete construction of Phase One 21 hospital improvements (Section 307). 22 23 24 25 26 27 RBK\AGMT\141931.8 -3- £- t¡, 10/09/97 I l.07am - - -. 1 ATTACHMENT NO. 6 2 In-Lieu Tax Payment Schedule 3 1. As used in this Attachment No. 6, the following 4 definitions shall apply: 5 (a) "Guaranteed Base" shall mean the sum of $16,320, subject to a prospective two percent (2%) annual 6 increase every July 1, with the first increase occurring on July 1, 1998. 7 (b) "Guaranteed Cancer Center Increment" shall 8 mean the sum of $36,000, subject to a prospective two percent (2%) annual increase every July 1, with the first increase 9 occurring on July 1, 1999, and subject to adjustment as set forth in Section 3 below. 10 (c) "Guaranteed First MOB Increment" shall mean 11 the sum of $80,000, subject to a prospective two percent (2%) annual increase every July 1, with the first increase occurring 12 on July 1, 2003, and subject to adjustment as set forth in Section 3 below. 13 (d) "Guaranteed Second MOB Increment" shall mean 14 the sum of $80,000, subject to a prospective two percent (2%) annual increase every July 1, with the first increase occurring 15 on July 1, 2005, and subject to adjustment as set forth in Section 3 below. 16 2. The following amounts shall, collectively, 17 constitute " In-Lieu Tax Payments": ' 18 (a) Beginning January 1, 1997, if Agency receives less than the Guaranteed Base from the Site in annual property 19 tax revenues (including possessory interest taxes), then Participant shall pay Agency the difference between the actual 20 property tax revenues (including possessory interest taxes) received by Agency from the Site and the Guaranteed Base. For 21 purposes of calculating In-Lieu Tax Payments due for the half tax year from January 1, 1997 through June 30, 1997, if one half of 22 the property tax revenues received by the Agency for the entire 1996-97 tax year (including possessory interest taxes) is less 23 than half of the Guaranteed Base, then Participant shall pay Agency the difference. 24 (b) Beginning July 1, 1999, if Agency receives 25 less than the sum of the Guaranteed Base and the Guaranteed Cancer Center Increment in annual property tax revenues 26 (including possessory interest taxes) from the Site, then Participant shall pay Agency the difference between the actual 27 property tax revenues (including possessory interest taxes) RBKIAGMT\141931 ,8 -1- E-i'1 10/09/97 IIo07am . . . T 1 received by Agency from the Site and the sum of the Guaranteed Base and the Guaranteed Cancer Center Increment. 2 (c) Beginning July 1, 2003, if Agency receives 3 less than the sum of the Guaranteed Base, the Guaranteed Cancer Center and the Guaranteed First MOB Increment in annual property 4 tax revenues (including possessory interest taxes) from the Site, then Participant shall pay Agency the difference between the 5 actual property tax revenues (including possessory interest taxes) received by Agency from the Site and the sum of the 6 Guaranteed Base, the Guaranteed Cancer Center Increment and the Guaranteed First MOB Increment. 7 (d) Beginning July 1, 2005, if Agency receives 8 less than the sum of the Guaranteed Base, the Guaranteed Cancer Center, the Guaranteed First MOB Increment and the Guaranteed 9 Second MOB Increment in annual property tax revenues (including possessory interest taxes) from the Site, then Participant shall 10 pay Agency the difference between the actual property tax revenues (including possessory interest taxes) received by Agency 11 from the Site and the sum of the Guaranteed Base, the Guaranteed Cancer Center Increment, the Guaranteed First MOB Increment and 12 the Guaranteed Second MOB Increment. 13 3. (a) If the San Diego County Tax Assessor should in the future determine that the Cancer Center, the First MOB or 14 the Second MOB is wholly tax exempt (a "Tax-Exempt Facility"), and if the amount of the real property taxes that would have been 15 assessed against the Tax-Exempt Facility but for the tax exemption (the "Assessed Taxes") exceeds the Guaranteed Increment 16 for that Tax-Exempt Facility, determined as provided in Section 1 above, then for purposes of the formula for computing the In-Lieu 17 Tax Payments payable by ,Participant in Section 2 above, the , Assessed Taxes for the Tax-Exempt Facility shall be deemed to be 18 the Guaranteed Increment for the Tax-Exempt Facility. For example, if in July 1999, the San Diego County Tax Assessor 19 determines that the Cancer Center is tax exempt, and the Assessed Taxes for the Cancer Center equal $40,000, then, since $40,000 is 20 greater than the Guaranteed Cancer Center Increment of $36,000, the Guaranteed Cancer Center Increment would increase to $40,000 21 for purposes of the computation of In-Lieu Tax Payments under Section 2 above. 22 (b) If the San Diego County Tax Assessor should 23 in the future determine that a portion of the Cancer Center, the First MOB or the Second MOB iß tax exempt (a "Tax-Exempt 24 Portion"); and if the amount of the real property taxes that would have been assessed against the Tax-Exempt Portion but for 25 the tax exemption (the "Portion Assessed Taxes") exceeds the corresponding portion (based on the percentage that the floor 26 area of the Tax-Exempt Portion bears to the total floor area of the facility) of the Guaranteed Increment for that facility, 27 determined as provided in Section 1 above (the amount of such RBK\AGM1\141931.8 -2- £-f?t:t 10/09/97 1l,07am -. .¡ 1 excess being the "Difference"); then, for purposes of the formula for computing the In-Lieu Tax Payments payable by Participant in 2 Section 2 above, the Guaranteed Increment for the facility shall be increased by the amount of the Difference. For example, if in 3 July 1999, the San Diego County Tax Assessor determines that 20% of the Cancer Center (the Tax-Exempt Portion) is tax exempt, and 4 the amount of real property taxes that would have been assessed against the Tax-Exempt Portion but for the tax exemption is $8000 5 (the Portion Assessed Taxes), then, since that amount exceeds the corresponding portion (20%) of the Guaranteed Cancer Center 6 Increment ($7200) by $800 (the Difference), the Guaranteed Cancer Center Increment would increase by $800 to $36,800 for purposes 7 of the computation of In-Lieu Tax Payments under Section 2 above. 8 (c) For purposes of this Section 3, the Assessed Taxes and Portion Assessed Taxes shall be determined by reference 9 to the San Diego County Tax Assessor's rolls, which, it is the parties' understanding and assumption, shall continue to reflect 10 the then-current assessed value of each parcel of the Site, regardless of any tax exemption to which a parcel may be subject, 11 in the same manner as property that is not subject to a tax exemption. 12 4. In-Lieu Tax Payments shall be made in arrears 13 commencing upon the first July 1 following (and computed back to) the applicable calculation dates described in Section 2 above, 14 and, thereafter, shall continue to be paid annually on or before July 1, until the termination date of the Redevelopment Plan. 15 16 17 , 18 19 20 21 22 23 24 25 26 27 RBK\AGM1\141931.8 -3- £ -g9 10100197 1 ¡,Q7am . 0 or 1 ATTACHMENT NO. 7 2 Certificate of Completion 3 4 RECORDING REQUESTED BY AND WHEN RECORDED RETURN TO: 5 Redevelopment Agency of the 6 City of Chula Vista 276 Fourth Avenue 7 Chula Vista, California 92010 8 CERTIFICATE OF COMPLETION 9 10 THIS CERTIFICATE OF COMPLETION (the "Certificate") is given as of this ------ day of , 19-----, by 11 REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISA, a public body, corporate and politic (hereinafter referred to as "Agency") to 12 (hereinafter referred to as "Owner"), with reference to the following: 13 A. Owner is the owner of the real property in the 14 City of Chula Vista, County of San Diego, State of California (hereinafter referred to as the "Property"), described in 15 Exhibit A, attached hereto and incorporated herein by this reference; and 16 B. The Property is situated within the Town Centre II 17 Redevelopment Project area (the "Project Area") in the City of , Chula Vista (the "City"), said Project Area being specifically 18 described in the Redevelopment Plan (the "Redevelopment Plan") for the Project Area (which was adopted on August 15, 1978 by the 19 City Council of the City of Chula Vista by Ordinance No. 1827 and amended on May 19, 1987, by Ordinance No. 2207 and on July 12, 20 1988, by Ordinance No. 2274); and 21 C. That Owner has agreed to develop the Property in accordance with that certain Amended and Restated Owner 22 Participation Agreement (the "OPA") entered into between Owner and Agency dated , 199--, and the Redevelopment 23 Plan. Capitalized terms used herein but not otherwise defined shall have the same meaning ae set forth in the OPA. 24 D. This Certificate is given pursuant to Section 324 25 of the OPA to evidence Owner's completion of the 26 27 RBK\AGMT\141931.8 -1- £-'10 10/09/97 l1o07am . - ..- 1 NOW, THEREFORE, AGENCY CERTIFIES AS FOLLOWS: 2 1. This Certificate shall constitute conclusive determination by Agency that Owner has satisfied its obligations 3 to complete the improvements pursuant to . Article II of the OPA; provided, however, that in no event shall 4 this Certificate constitute a representation by Agency for any other purpose as to the adequacy or completeness of such 5 improvements or otherwise relieve Owner of any liability for improper design or construction (or other performance) of the 6 improvements or of any liability for any indemnity or other obligation undertaken by Owner with respect to such improvements. 7 2. Except to the extent expressly provided above, 8 this Certificate shall not constitute evidence or compliance with or satisfaction of any obligation of Owner to any holder of a 9 mortgage or any insurer of a mortgage securing money loaned to finance the improvements or any part thereof. This Certificate 10 is not a notice of completion as referred to in California Civil Code Section 3093. 11 IN WITNESS WHEREOF, Agency and Owner have executed this 12 Agreement. 13 "Agency" 14 REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA, a public body, 15 corporate and politic 16 By: 17 Chairman . 18 APPROVED AS TO FROM: 19 20 John M. Kaheny, Esq. Agency General Counsel 21 "Owner" 22 23 a 24 By: 25 Its: 26 By: 27 Its: RBKIAGMT\14193LB -2- £ -'II 10/09/97 11:07am . . -.- JOINT REDEVELOPMENT AGENCY/COUNCIL AGENDA STATEMENT Item S' Meeting Date 10/21/97 ITEM TITLE: AGENCY RESOLUTION /4-,.3 COUNCIL RESOLUTION /ggO' ADOPTING NEGATIVE DECLARA TION IS-98- 02, DEEMING ALL OWNER PARTICIPATION RIGHTS WAIVED, AND APPROVING A PURCHASE AND SALE AGREEMENT BY AND BETWEEN THE CITY OF CHULA VISTA, CHULA VISTA REDEVELOPMENT AGENCY AND THE RESPECTIVE PROPERTY OWNERS OF 3554 MAIN STREET, CHULA VISTA, FOR THE PURPOSES OF SITING THE DTAY GYMNASIUM PROJECT ~ ' SUBMITTED BY: '"mm~;ty D~.I"..."t DI.,,", { . ~ ~ P,," R""~';"" ,"d 0,. ~.""" REVIEWED BY: Executive Director J~ ~ /} (4/5ths Vote: Yes - No ÅJ BACKGROUND: On May 6, 1997, the City Council and Redevelopment Agency Board authorized staff to negotiate the acquisition of the 1.37 acre parcel (APN 623.23.26) located at 3554 Main Street for the purpose of siting the proposed Otay Gymnasium. The proposed site is located in the Southwest Redevelopment Project Area immediately adjacent to Otay Elementary School and the San Diego Gas and Electric Substation at Main and Albany. Staff has reached agreement with the three property owners and requests that the City Council/Redevelopment Agency approve the proposed Purchase and Sale Agreement and Joint Escrow Instructions ("Agreement"). The Agreement is included as Attachment 1. An Initial Study for the Otay Gym was conducted and a Negative Declaration was issued for public review (Attachment 2). RECOMMENDATION: It is recommended that the Council/Agency approve the resolution: 1) adopting Negative Declaration IS-98-02; and 2) approving the Agreement for the property located at 3554 Main Street for the purpose of siting the proposed Otay Gymnasium Project. BOARDS/COMMISSIONS RECOMMENDATION: Not applicable. DISCUSSION: As indicated in the Agenda Statement of May 6, 1997, staff had two appraisals completed by different firms which concluded that the fair market value for the site, including improvements, is $410,000. Prior to issuing an offer to acquire, staff had an updated valuation completed which substantiated the previous value. Based upon those appraisals and site environmental studies, staff issued formal offer letters at full fair market value. Staff is pleased to advise that the three respective property owners eventually agreed to the purchase price and all terms and conditions. 5-1 Page 2. Item ~ Meeting Date 10/21197 Staff, in the offer letters, extended proper owner participation rights to the property owners and the existing tenant on site (Valencia's Diesel Truck Repair) porsuant to the Southwest Redevelopment Plan. All parties elected not to exercise these rights. Therefore, as part of this action, the resolution deems that all owner participation rights have been waived. It is important to note that the City/Agency will be responsible for relocating the existing tenant and will be utilizing the services of a relocation consultant (Ryals and Associates) to perform the necessary obligations under the Uniform Relocation Assistance Act. The City will be pursuing that action shortly after approval of the Agreement. After approval, escrow will be opened and expected to close within 30 days. At that time, the property will be available for development by the City. It should also be noted that the site has been cleared of the dilapidated and blighted structures that previously occupied the site. Due to the "attractive nuisance" and potential dangerous health and safety conditions, staff went ahead and utilized available and appropriate CDBG funds to clear the site. The property owners agreed that they would share in the costs up to $2,000. The total cost of the work was $4,500; with the City being credited $2,000 through escrow. SUMMARY OF PURCHASE AGREEMENT The proposed Purchase Agreement has been reviewed and approved by the City Attorney's office and includes all standard protections and provisions. Below is a summary of the agreement deal points: - Property to be sold for $410,000 (including improvements) - City/Agency is credited for $2,000 for the demolition costs. - City is responsible for all escrow costs and fee. No broker commissions are included in this transaction. - City has a maximum 45-day contingency period within which to withdraw from the transaction in the event that circumstances arise during the escrow period that results in the City electing not to close escrow. - Liquidated damages to the seller are limited to $5,000. ENVIRONMENTAL REVIEW An Initial Study was conducted for the Otay Gym project in accordance with CEQA. No significant impacts were identified by that study and a Negative Declaration was issued. The public review period closed on September 4, 1997. A copy of the Negative Declaration and public comments are included as Attachment 2. CURRENT STATUS OF DTAY GYMNASIUM PROJECT Staff has commenced, in earnest, the Otay Gymnasium Capital Improvement Project. A Project Team has been formed with staff from Engineering, Operations, Planning, Fire, Community Development, and Building and Housing. The Architect has re-mobilized his design team and a new site plan for the Main Street parcel has been developed (see Site Plan, Attachment 3). Further, a conceptual landscape plan was completed and both design plans were distributed for review to the appropriate Departments. On June 18, 1997, the concept plans were S-~ Page 3. Item 5' Meeting Date 10/21/91 reviewed at an Otay community meeting and the community consensus was to support the design proposed by the Department. The Parks and Recreation Commission, at their regular meeting of July 17, 1997, reviewed the Dtay Gymnasium Concept Plan and accepted staff's recommendation on the design plan for the Main Street site. Staff is also meeting and discussing with San Oiego Gas and Electric (SDG&E), a proposed lease of the electrical substation property directly west of the project (on the corner of Main and Albany) for the use of the land as an overflow parking lot for the gymnasium. Since this is SDG&E property, the parking lot would be considered "temporary" in nature; but would suffice for the parking needs of the project. For SDG&E's current fiscal year, there is a budget of approximately $30,000 that will be used to construct the parking lot. Discussions are continuing regarding the funding of landscaping on SDG&E property. Hiaher Construction Costs and Potential Additional Fundina for the Proiect: When the Otay Gymnasium project was first conceived, the plan was to build the gymnasium on the Otay Elementary School site. It was initially believed that by relocating the siting of the gymnasium from the school site to the Main Street there would be cost savings. The higher costs associated with building the gymnasium on the school site, were attributed to the standards and specifications of the Division of the State Architect. By moving the site, the costs for the gymnasium were reduced from $3,010,000 to $2,840,000. However, because of the length of time that this project has taken to determine the appropriate location for the gym and then negotiate the procurement of the site; construction costs have risen. The current Capital Improvement Project appropriation for the gymnasium (PR.133) is $2,840,000 in COBG funds. The new costs are estimated to be $3.453,318. The difference in cost is attributable to the gymnasium and associated site development costs (see cost line items listed on the next page). It has been two years since the project costs were originally estimated. During these two years, the construction industry has had a revival and the bids for City projects are coming in higher. Contractor's Overhead and Profit has increased by 3%; and there is a market escalation factor of 10%. This brought the construction cost section of the CIP from a total of $1,729,000 to $2,220,345 (before construction contingency factor is added). Staff believes this discussion regarding costs is important to be noticed to the Council at this time due to the changing dynamics of this project and the construction cost estimates. Final design approval and a financing package will be brought to the Council at a later date. This will include a variety of options to either stay within the currently approved CIP budget of $2,840,000, or a recommendation to approve an amended budget for increased construction and site improvements for this project. In addition to any discussion regarding the ultimate costs of the gymnasium project; staff will also be recommending street improvements adjacent to the gymnasium site. While the following discussion describes the proposed street improvements; it should be noted these street improvements are already scheduled in the future CIP and that the projects are merely being accelerated to coincide with the gymnasium project. 5"~3 Page 4, Item !r Meeting Date 10/21197 Main Street ImDrovements and Traffic Sienal: At the Albany and Main Street intersection, there are existing street and right-of-way improvements, and traffic signal plans, scheduled for a future date (see Site Plan and Site Elevation, Attachments 3 and 4). The traffic signal at this intersection is currently on the proposed traffic signal list and has a high priority. Street and right- of-way improvements are projected to cost about $309,000. A traffic signal is projected to cost about $160,000. These are unanticipated costs that were not factored into the project's budget. The City has developed a long-range plan to eventually improve this section of Main Street. However, the CIP for this section of Main Street is in Phase III, scheduled for the year 2001. It is anticipated that the Main Street CIP project could be accelerated and constructed concurrently with the Otay Gymnasium Project. For the street improvements, funds could be utilized from TransNet; and for the traffic signal, from the Traffic Signal Fund. COST ITEM PREVIOUS COST ESTIMATED COST DIFFERENCE Preparatory Planning $ 69,900 $69,900 +$0 land Acquisition $ 430,000 $430,000 +$0 Design $ 199,000 $199,000 +$0 Staff Services $ 20,100 $20,100 +$0 Construction; Building $1,290,500 $1.670,000 + $379,500 Grading $55,000 $70,000 +$15,000 Sewer and Utilities $50,000 $36,860 ($13,140) Site Hardscape Costs increased due to design of $0 $101)85 +$101)85 plaza feature Streets/Drainage scope of work increased to $5,000 $71,700 + $66,700 Streets/Drainage/Site A-C/Paving Lighting $27,500 $27,500 +$0 landscaping/lrrigation $140,000 $150,000 +$10,000 Equipment $20,000 $25,000 + $5,000 Site furnishings, paving $141,000 $47,500 ($93,500) Construction Costs Sub-Total $1)29,000 $2,200,345 + $471,345 Construction Contingency $172,900 $220,035 +$47,135 Construction Changes Sub-Totals $1,901,900 $2,420,380 +$518,480 General Administration Contingency $219,100 $313,938 + $94,838 Changes Totals $2,840,000 $3,453,318 +$613,318 ~-" Page 5. Item S Meeting Date 10/21/97 Due to the uncertain nature of the construction market, the project Architect will be updating these costs before the construction bid is noticed, in order to gauge more accurately the construction costs. The current source of funds for the Dtay Gymnasium Project is Community Development Block Grant (CDBG). It is anticipated that an allocation from the CDBG City allotment for FY 98/99 will be recommended to the Council to fund the construction cost increases. However, the CDBG program could not absorb $613,318 in one program year without adversely affecting other projects, programs, and services. Therefore, a funding plan will need to be devised whereby the amount is spread out over several years or other funding sources are utilized such as PAD monies. FISCAL IMPACT: Approval of the Agreement will result in the expenditure of $41O,DOO with a credit, through escrow, of $2,000 for site clearance costs. The funds have been approved and are available in the Otay Gymnasium CIP project (PR-133). Although not a part of this item, the City will be responsible for relocation benefits to the business tenant on site. Staff estimates a total obligation of approximately $20,000 for that purpose. Based on current construction cost information, the costs for the entire project may increase as follows: PREVIOUS COST ESTIMATED COST DIFFERENCE Gymnasium Construction - PR.133 $2,840,000 $3.453,318 $613,318 (CDBG Funds) Main Street Improvements $309,000 $309,000 $0 (Trans Net and/or other Street Funds) Albany/Main Traffic Signal $160,000 $160,000 $0 (Traffic Signal Funds) TOTAL $3,309,000 $3,922,318 $613,318 Additional costs proposed to be funded from future CDBG and/or PAD funds. ATTACHMENTS 1 - Agreement 2. Initial Study, Negative Declaration and Public Comments 3 - Site Plan 4. Site Elevation {CHI Ho\HOME\COMMOEV\STAff,REP\IO.O7.97\OTAYGYMIO,tob" IS. 1997 112:20pmll 5"'~ - . -. AGENCY RESOLUTION NO. /~"",3 and I COUNCIL RESOLUTION NO. JttD JOINT RESOLUTION OF THE CITY COUNCIL AND THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA ADOPTING NEGATIVE DECLARATION IS-98-02, DEEMING ALL OWNER PARTICIPATION RIGHTS WAIVED, AND APPROVING A PURCHASE AND SALE AGREEMENT BY AND BETWEEN THE CITY OF CHULA VISTA AND THE RESPECTIVE PROPERTY OWNERS OF 3554 MAIN STREET, CHULA VISTA, FOR THE PURPOSES OF SITING THE OTAY GYMNASIUM PROJECT WHEREAS, on May 6, 1997, the City Council and Redevelopment Agency Board authorized staff to negotiate the acquisition of the 1.37 acre parcel (APN 623-23-26) located at 3554 Main Street ("Property") for the purpose of siting the proposed Otay Gymnasium; and WHEREAS, the proposed site is located in the Southwest Redevelopment Project Area adjacent to Otay Elementary School and the San Diego Gas and Electric Substation at Main Street and Albany; and WHEREAS, owner participation rights were extended to all property owners and the existing business tenant on site pursuant to the Southwest Redevelopment Plan; and WHEREAS, the property owners and tenant elected not to exercise those rights; and WHEREAS, staff has reached agreement with the three property owners and a formal Purchase and Sale Agreement ("Agreement") has been prepared; and WHEREAS, an Initial Study for the project was completed in accordance with the California Environmental Quality Act (CEQA) and Negative Declaration (IS-98-02) was issued. NOW, THEREFORE, BE IT RESOLVED the City Council and Redevelopment Agency of the City of Chula Vista do hereby adopt Negative Declaration IS-98-02 as the lead and responsible agencies, respectively. BE IT FURTHER RESOLVED the City Council and Redevelopment Agency of the City of Chula Vista do hereby approve the Agreement for acquisition by the City of the Property for the purpose of siting the proposed Otay Gymnasium Project; such Agreement is approved in substantially the form presented with such minor modifications as may be required or approved by the City Attorney. BE IT FURTHER RESOLVED, that the Mayor is authorized to execute the Agreement, a copy of which shall be kept on file with the City Clerk as Document No.~ Presented by Approved as to form by ~~ç~ Chris Salomone, Director of Community Development [{CHI Ho\HOMElCOMMDEV\RESOSlOTAYGYM 10oto'" 16,1997 "o21pmll S'-fo - . PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS SELLER: OBOULIA E. ALLEN, an individual, ROBERT A. COATS, an individual, and CHRISTINA E. COATS, an individual, as tenants in common BUYER: CITY OF CHULA VISTA, a municipal corporation ESCROW NO: DRAFT: September 10, 1997 H:"ha""lattomeylobdul" /I 1- ( 1 - . PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS This PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS ("Agreement"), is entered into effective as of , 1997 by and between the OBDULIA E. ALLEN, an individual, ROBERT A. COATS, an individual, and CHRISTINA E. COATS, an individual, as tenants in common (collectively, "Seller"), and the CITY OF CHULA VISTA, a municipal corporation, ("Buyer"). NOW, THEREFORE, in consideration of the mutual covenants set forth herein, and for other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer agree as follows: ARTICLE 1 AGREEMENT OF PURCHASE AND SALE 1.1 Description of Propertv. Seller owns certain real property ("Property") located at 3554 Main Street in the City of Chula Vista, County of San Diego, California (Assessor's Parcel No. 623- 23-26), comprised of an approximately 1.37 acre parcel. The Property is more particularly described on Exhibit "A" attached hereto. 1.2 Offer to Purchase. Seller's execution of this Agreement constitutes an irrevocable offer to sell the Property on the terms and conditions stated herein. Such offer may be revoked by Seller in the event that Buyer fails to (a) accept Seller's offer by approving this Agreement by no later than October 28, 1997 by formal Resolution, and/or (b) deliver an executed copy of this Agreement to Escrow (as provided herein) before 5:00 P.M. on October 31, 1997. 1.3 Purchase and Sale. Buyer's execution of this Agreement within the time period specified in Section 1.2 shall create a binding agreement between the parties hereto, effective on the date of Buyer's execution, whereby Seller agrees to sell the Property to Buyer and Buyer agrees to purchase the Property from Seller, on the terms and conditions stated herein. 1.4 Purchase in Lieu of Condemnation. Buyer requires the Property for the purpose of construction of a public gymnasium thereon, a purpose for which Buyer may exercise the power of eminent domain. Seller is compelled to sell and Buyer is compelled to acquire the Property. Both Seller and Buyer recognize the expense, time, effort and risk to both parties in resolving a dispute over compensation for the Property by eminent domain litigation; and the compensation set forth herein for the Property is in compromise and settlement in lie.u of such litigation. 1.5 Deposit. (a) Good Faith Deposit. Upon Buyer's approval of this Agreement, Buyer shall deposit Ten Thousand Dollars ($10,000) into Escrow as a good faith deposit. Such deposit shall be made pursuant to the terms of Section 3.3 hereof, below. If Buyer elects to proceed to acquire the Property after satisfaction or waiver of all contingency period approvals, Buyer shall immediately increase Buyer's good faith deposit to a total of Fifty Thousand Dollars ($50,000). Such amounts shall collectively be referred to hereinafter as the "Deposit". If Buyer proceeds to acquire the Property, Buyer's Deposit, plus any interest earned thereon, shall be applied towards the Purchase Price at Close of Escrow. Buyer's Deposit payments shall be in the form of either a direct wire transfer to Escrow, a cashier's or certified checks drawn on a California bank account payable to Escrow Agent. Buyer's failure to make the Deposit payments when required shall be a material default hereunder, and Seller shall have the right to terminate this Agreement. Escrow Agent shall invest the Deposit amounts in a federally-insured, interest-bearing account approved by Buyer, and ;4 /- 2. all interest earned thereon shall be credited to Buyer. The Deposit shall be returned to Buyer if Buyer elects to terminate this Agreement and the Escrow for nonsatisfaction of any condition pursuant to Section 5.4. (b) LIQUIDATED DAMAGES. IF BUYER FAILS TO COMPLETE THE PURCHASE OF THE PROPERTY AND SUCH FAILURE CONSTITUTES A DEFAULT HEREUNDER, AND IS NOT THE RESULT OF NONSATISFACTION OF CONDITIONS OR A DEFAULT BY SELLER, THE PARTIES ACKNOWLEDGE AND AGREE THAT (1) SELLER'S DAMAGES WILL BE EXTREMELY DIFFICULT AND IMPRACTICAL TO ASCERTAIN, AND (2) THE AMOUNT OF FIVE THOUSAND DOLLARS ($5,000) REPRESENTS A REASONABLE ESTIMATE OF SUCH DAMAGES, CONSIDERING ALL THE CIRCUMSTANCES EXISTING ON THE DATE OF EXECUTION OF THIS AGREEMENT. THEREFORE, THE PARTIES ACKNOWLEDGE AND AGREE THAT IN THE EVENT OF SUCH FAILURE TO PERFORM BY BUYER, SELLER SHALL HAVE THE RIGHT TO RETAIN $5,000 OF THE DEPOSIT AS LIQUIDATED DAMAGES PURSUANT TO CALIFORNIA CIVIL CODE SECTION 1671. SUCH LIQUIDATED DAMAGES SHALL CONSTITUTE SELLER'S SOLE AND EXCLUSIVE REMEDY AGAINST BUYER, ALL OTHER REMEDIES BEING HEREBY EXPRESSLY WAIVED BY SELLER. ANY REMAINING AMOUNTS OF THE DEPOSIT SHALL BE RETURNED TO BUYER. SELLER WAIVES ALL RIGHTS SELLER MAY OTHERWISE HAVE PURSUANT TO CALIFORNIA CIVIL CODE SECTION 3389 TO SPECIFICALLY ENFORCE THIS AGREEMENT. BY SIGNING THEIR INITIAlS BELOW, EACH PARTY CONFIRMS ITS CONSENT TO AND AGREEMENT WITH THE PROVISIONS OF THIS PARAGRAPH: Seller's Initials Buyer's Initials ARTICLE 2 PURCHASE PRICE 2.1 Purchase Price. The total Purchase Price which Buyer agrees to pay and Seller agrees to accept for the Property is the sum of FOUR HUNDRED TEN THOUSAND DOLLARS ($410,000), payable through Escrow as follows: (a) The aggregate Deposit of $50,000 shall be delivered to Escrow Agent in two installments as provided in Section 1.4; (b) The sum of $360,000 shall be delivered to Escrow Agent in cash, in the form of a cashier's or certified check or wired funds prior to the Close of Escrow. ARTICLE 3 ESCROW 3.1 Escrow Aqent. Spring Mountain Escrow Company [ATTN: Escrow Officer], located at 1150 Broadway, Suite 210, EI Cajon, CA 92021, ("Escrow Agent") is designated, authorized and instructed to act as Escrow Agent pursuant to the terms of this Agreement. Escrow Agent shall acknowledge the Opening of Escrow and its agreement to act as the escrow agent hereunder by: (a) executing the Consent of Escrow Agent attached hereto; and (b) promptly delivering a copy of the executed Consent to Seller and Buyer. 3.2 Escrow Instructions. This Agreement shall constitute initial escrow instructions to Escrow Agent. Escrow Agent's general conditions are attached hereto as Exhibit "B" and made a part hereof, to the extent they are consistent with the provisions of this Agreement. The parties 14/ -oJ . . shall execute any additional escrow instructions reasonably required by Escrow Agent to consummate the transaction provided for herein; provided, however, such additional escrow instructions shall not modify the provisions of this Agreement, unless such instructions (a) state the modification in full, and (b) are signed by both parties. 3.3 OpeninG of Escrow. Within three (3) business days after execution by both parties, Buyer shall deliver a fully executed copy of this Agreement and the Deposit to Escrow Agent. Opening of Escrow shall be the date Escrow Agent executes the Consent described in Section 3.1. 3.4 Close of Escrow. "Close of Escrow" or "Closing" means the date Escrow Agent records the Grant Deed in favor of Buyer and delivers the Purchase Price to Seller. Escrow shall close on the day falling five (5) days after the expiration of the Contingency Period defined in section 5.1 hereof, below; provided that, if all conditions are satisfied and all funds and documents required hereunder are deposited in Escrow at an earlier date, Escrow Agent shall close the Escrow on such earlier date. Buyer shall have the unilateral right to extend the Contingency Period for an additional fifteen (15) days by written notice to Escrow Agent (with a copy of to Buyer) delivered prior to 5:00 p.m. on the date for the initial expiration of the Contingency Period The Closing Date may not be further extended except by a written escrow instruction signed by Buyer and Seller. If the Escrow does not close on or before the Closing Date for any reason other than a default by Seller, and if the Closing Date has not been validly extended as provided hereunder, then Buyer shall be in material default hereunder and Seller shall have the unilateral right to terminate this Agreement and the Escrow by delivering written notice to Escrow Agent with a copy to the other party), in which event Seller shall have no further obligation hereunder. 3.5 Deliveries to Escrow. Prior to the Closing Date specified in Section 3.4, each party shall timely deliver to Escrow all funds and documents required of such party in order to complete the Closing under the terms of this Agreement, including, but not limited to, prorated amounts and other payments required under Section 3.7. 3.6 Completion of Documents. Escrow Agent is authorized: to insert the Closing Date and othelWise complete the documents deposited in Escrow, where appropriate and consistent with this Agreement. 3.7 Prorations. Escrow Fees and Costs. (a) Prorations. The following items shall be prorated in Escrow, as of the date of Close of Escrow: real estate taxes, based on the most recent information available in the office of the taxing entity and any rental income arising from tenancies or contracts which shall be assumed by Buyer. All prorations shall be made on the basis of a 30-day month and a 360-day year, unless the parties othelWise agree in writing. If Buyer receives, after tre Closing, any supplemental bill for real estate taxes or assessments which relates, in whole or in part, to the period prior to the Closing, such supplemental bill shall be allocated between Seller and Buyer as of the Closing Date, and Seller shall pay the amount due to Buyer within thirty (30) days after Seller's receipt of a statement and request for payment. (b) Seller's Pavments. Seller will pay: (1) the County Documentary Transfer Tax, in the amount Escrow Agent determines to be required by law; and (2) the cost of the Title Policy described in Section 4.2. (c) Buver's Pavments. Buyer will pay: (1) any and all non-customary Escrow charges; (2) Escrow Agent's escrow fee (or Escrow cancellation charges, if any); and (3) all other customary Seller and Buyer Escrow charges and expenses, except for Seller's payments provided in Section 3.7(b), above. 4/1/- 4- (d) Default. Notwithstanding the foregoing, in the event of a default by Buyer or Seller hereunder, all cancellation and other escrow charges shall be paid by the defaulting party. 3.8 Exislinq Encumbrances. Escrow Agent is authorized to secure beneficiary demands and requests for reconveyance for those monetary liens which are not Permitted Exceptions pursuant to Section 4.2 and the Property shall be reconveyed from each of the foregoing at Close of Escrow. 3.9 Distribution of Funds and Documents. At the Close of Escrow, Escrow Agent shall do each of the following: (a) Pavmenl of Encumbrances. Pay the amount of those monetary liens which are not Permitted Exceptions to the obligees thereof, in accordance with the demands approved by Seller, utilizing funds to which Seller shall be entitled upon Close of Escrow and funds (if any) deposited in Escrow by Seller. (b) Recordation of Documents. Submit to the County Recorder of San Diego County the Grant Deed for the Property and each other document to be recorded under the terms of this Agreement or by general usage, and, after recordation, cause the County Recorder to mail the Grant Deed to Buyer and each other such document to the grantee, beneficiary or person acquiring rights thereunder or for whose benefit said document was recorded. (c) Non-Recorded Documents. Deliver by United States mail (or hold for personal pickup, if requested): (1) the Title Policy to Buyer; each other non-recorded document received hereunder to the payee or person acquiring rights thereunder or for whose benefit said document was acquired. (d) Distribution of Funds. Deliver by United States mail (or comply with other unilateral instructions given by the applicable party): (1) To Seller, the cash portion of the Purchase Price, adjusted for prorations, charges and other credits and debits provided for herein ("Seller Proceeds"). Seller Proceeds shall be distributed among the parties comprising Seller as follows: (i) 50% to Obdulia E. Allen, or order; (Ii) 25% to Robert A. Coats, or order; and (iii) 25% to Christina E. Coats, or order. (2) to Buyer, or order (i) The sum of $2,000, to be reimbursed to Buyer out of Buyer's deposited funds, to compensate Buyer for necessary demolition and debris removal work on the Property; and (ii) any excess funds delivered to Escrow Agent by Buyer. ARTICLE 4 TITLE MATTERS 4.1 Preliminarv Title Report. (a) Deliverv to Buver. As soon as possible after Opening of Escrow, Escrow Agent shall provide to Buyer, at Seller's expense, a preliminary title report ("PR") issued by First American Title Company, or such other company designated by Buyer and reasonably approved by Seller ("Title Insurer") reflecting the status of title to the Property. The PR will be deemed received by Buyer on the date of personal delivery or three (3) days after mailing by Escrow Agent. (b) Time to Obiect. Buyer shall have thirty (30) days after the date of receipt of the PR to notify Escrow Agent (with a copy to Seller), in writing, of its objection to the legal description and any matters indicated as exceptions in the PR. Buyer shall not object unreasonably. (c) No Objection. If Buyer's written approval is not received by Escrow Agent within said 30-day period, Buyer shall be deemed to have approved the PRo 5 III-~ - - (d) Time to Eliminate Exceptions. If Buyer objects to one or more exceptions indicated in the PR, Seller may cure such objection by delivering to Escrow Agent (with a copy to Buyer), within ten (10) days after Seller's receipt of Buyer's objection, Seller's written agreement to eliminate such exception(s) by the Closing Date. (e) Riç¡ht to Cancel or Perform. If Seller does npt agree to cure each exception to which Buyer has objected, Buyer shall elect one of the following, by delivering written notice to Escrow Agent (with a copy to Seller) within five (5) days after receipt of notice of Seller's election or expiration of the 10-day period described in (d) above (whichever occurs first): (1) to waive its objections, take title subject to such exceptions, and proceed with Close of Escrow; or (2) to terminate this Agreement and the Escrow, in which event neither party shall have any further obligation hereunder and Buyer shall be entitled to recover its Deposit. 4.2 Title Insurance. As of Close of Escrow, Title Insurer shall issue, or be committed to issue, at Seller's sole cost, a standard form AL T A Owner's Title Insurance Policy ("Title Policy") insuring Buyer's title to the Property in the amount of the Purchase Price, subject only to the following permitted exceptions ("Permitted Exceptions"): (a) current, non-delinquent real estate taxes and assessments; (b) the lien of supplemental taxes, if any, assessed pursuant to Chapter 3,5 of the California Revenue and Taxation Code; (c) the matters set forth in the PR and approved by Buyer pursuant to Section 4.1 (c) or (e); (d) any other matters approved in writing by Buyer; and (e) matters excepted or excluded from coverage by the printed terms of the Title Policy's standard form. 4.3 Grant Deed. Prior to Close of Escrow, Seller shall deposit in Escrow a Grant Deed, duly executed and acknowledged in recordable form, conveying the Property to Buyer subject only to all matters of record and the Permitted Exceptions. ARTICLE 5 CONDITIONS TO CLOSE OF ESCROW 5.1 ContinGency Period. As used herein, the "Contingency Period" means a period beginning on the day following Buyer's approval of this Agreement by formal Resolution and ending on the day falling 30 days thereafter: provided, however, if Seller fails to deliver the items described in Section 5.2(a) within the 10-day period described therein, the Contingency Period shall be extended on a per diem basis, for each day of delay until all of the items are delivered to Buyer. Buyer shall have the unilateral right to extend the Contingency Period for an additional fifteen (15) days by written notice to Escrow Agent (with a copy of to Buyer) delivered prior to 5:00 p.m. on the date for the initial expiration of the Contingency Period 5.2 Buyer's Conditions to Close of Escrow. Close of Escrow shall be subject to satisfaction of each of the following conditions precedent, which are for the benefit of Buyer, prior to expiration of the Contingency Period: (a) Title Matters. Buyer's approval of the PR, or Seller's election to cure each exception disapproved by Buyer, or Buyer's waiver of any remaining disapproved exception(s), pursuant to Section 4.1. (b) Seller's Deliveries. Seller's delivery to Buyer, within ten (10) business days after Opening of Escrow, of complete copies of the following items relating to the Property; (1) Copies of all current effective leases, rental agreements or other arrangements, if any, relating to the property which are to remain in effect after Buyer takes title to the property. /II-' 6 .. ... (2) Copies of any existing property survey(s) within Seller's possession or of which Seller is aware and are reasonably available to the Seller. (3) Copies of any existing reports relating to the environmental condition of this Property within possession or of which Seller is aware and are reasonably available to the Seller. (c) Buyer's Approval. Buyer's approval, in Buyer's reasonable discretion, prior to expiration of the Contingency Period, of the physical and environmental conditions of the Property, the items delivered by Seller pursuant to Section 5.2(b), the feasibility of acquisition, development, improvement, operation, maintenance and use of the Property for Buyer's intended purposes and the status of approval of any and all required development entitlements including, without limitation, Design Review approval. In order to conduct its feasibility review, Buyer shall have the right, after Opening of Escrow, to enter the Property, pursuant to Section 7.1. (d) Required Tax Documents. Seller's delivery to Escrow of completed state and federal non-foreign affidavit and/or disclosure documents. (e) Relocation Aqreement. Buyer shall have entered into a relocation agreement with the existing lawful tenants on the Property on terms and in a form reasonably approved by Buyer. 5.3 Satisfaction. Waiver of Conditions. Buyer's approval, wherever required to satisfy a condition, shall be evidenced by written notice delivered to Escrow Agent (with a copy to Seller). If Buyer's written approval is not received by Escrow Agent within the specified time limit, the matter shall be deemed approved provided Buyer has made its increased deposit to Escrow. 5.4 Seller's Conditions to Close of Escrow. (a) Buyer's deposit of the entire Purchase Price plus any of Buyer's closing costs required hereunder; 5.5 Failure of Conditions. If any of the foregoing conditions is neither salisfied nor waived by the benefitted party within the specified time limit, such party may unilaterally terminate this Agreement and the Escrow by giving written notice of termination to Escrow Agent (with a copy to the other party). In the event of such termination, Buyer's Deposit shall be immediately returned, and neither party shall have any further obligation hereunder; provided. 5.6 Diliqence: Cooperation. Each party agrees to exercise due diligence in satisfying each and every condition to Close of Escrow for which such party is responsible. Each party agrees to cooperate with the other party in satisfying those conditions to Close of Escrow for which such other party is primarily responsible. ARTICLE 6 REPRESENTATIONS AND WARRANTIES 6.1 Buyer's Representations and Warranties. Buyer agrees, represents and warrants, as of the date of its execution of this Agreement and as of Close of Escrow, as follows: (a) Authoritv. Buyer has full legal right, power and authority to execute and fully perform its obligations under this Agreement, without the need for any further action; and the persons executing this Agreement and other documents required hereunder on behalf of Buyer are the duly designated agents of Buyer and are authorized to do so. (b) Indemnity. Buyer shall indemnify, hold harmless and defend Seller and the Property from and against any and all liens, claims, liability, loss, damages, costs, expenses, suits or judgments for labor performed or materials furnished to or for Buyer, or for injuries to person or property damage, arising out of any accident or occurrence in any way connected with entry upon, 7 /11- 7 - - testing or inspection of the Property by Buyer or its agents pursuant to Section 7.1 of this Agreement. (c) Investiqation of Propertv. Buyer will make an independent investigation, to the extent Buyer deems necessary or appropriate, concerning the physical condition (including the existence of hazardous materials), value, development, use, marketability, feasibility and suitability of the Property, including (but not limited to) land use, zoning and other governmental restrictions and requirements. Buyer is acquiring the Property "AS IS," in its present state and condition solely in reliance upon Buyer's own investigation, and no representations or warranties of any kind, express or implied, have been made by Seller or its representatives, except as specifically set forth in Section 6.2. 6.2 Seller's Representations and Warranties. Each party comprising Seller, on his or her own behalf, agrees, represents and warrants, as of the date of execution of this Agreement and as of Close of Escrow, as follows: (a) Authoritv. Seller is the owner of the Property and has full legal right, power and authority to execute and fully perform its obligations under this Agreement and to convey the Property to Buyer and the persons executing this Agreement and other documents required hereunder on behalf of Seller are the duly designated agents of Seller and are authorized to do so. (b) Non-Foreiqn Affidavit. Seller represents and warrants to Buyer that it is not a foreign person and is a United States person as defined in Section 7701(1)(30) of the Internal Revenue Code, as amended ("Code"). (c) Condition of Propertv. To the best of Seller's knowledge there are no material adverse physical conditions or hazardous materials on the Property which would prevent the reasonable development of the property. 6.3 Real Estate Commissions. Each party represents and warrants to the other party that no brokers or finders have been employed or are entitled to a commission or compensation in connection with this transaction. Each party agrees to indemnify, protect, hold harmless and defend the other party from and against any obligation or liability to pay any such commission or compensation related to this transaction arising from the act or agreement of the indemnifying party. 6.4 Survival of Warranties. The representations and warranties given by Buyer and Seller in this Article 6, and all obligations to be performed under the terms of this Agreement after Close of Escrow, shall survive the Close of Escrow and delivery of the Grant Deed to Buyer. ARTICLE 7 ADDITIONAL OBLIGATIONS 7.1 Access to Propertv. Between the date of Opening of Escrow and the Close or earlier termination of Escrow, Seller shall allow Buyer and its agents reasonable access to the Property, upon reasonable notice to Seller, for the purpose of inspecting, surveying and testing the same. 7.2 Governmental Permits and Processinq. During the Escrow period, Buyer shall have the right to file applications for and to process, at Buyer's expense, applications for governmental permits and approvals for zoning, land use, subdivision, improvement, development and construction relating to the Property and Buyer's intended use. Buyer agrees to diligently pursue any and all such necessary approvals in order to permit the Close to occur prior to the Closing Date. Seller shall execute any applications or other documents referenced by applicable governmental authorities to authorize Buyer to process such permits and approvals, and shall cooperate reasonably with Buyer in connection therewith. 8 /l1-fj 7.3 Condemnation or Damaqe. If, prior to Close of Escrow, an action is commenced for the condemnation of the Property or any material portion thereof or interest therein, or the Property is materially damaged by fire, earthquake or other cause, so as, in either event, to render the Property unsuitable for Buyer's use, then Buyer shall have the right to terminate this Agreement by delivering written notice to Seller (with a copy to Escrow Agent) within ten (10) days after Buyer receives notice of the condemnation or damage. If Buyer terminates this Agreement within such 10- day period, then the Escrow shall be cancelled, neither Buyer nor Seller shall have any further obligation under this Agreement, and Buyer's Deposit shall be returned. If Buyer fails to deliver written notice of termination within said 10-day period, Buyer shall be deemed to have waived and Buyer shall proceed to consummate the purchase pursuant to this Agreement. Buyer shall have no other remedies against Seller as a result of such condemnation or destruction of the Property except as set forth in this Section. Buyer shall have no other remedies against Seller as a result of such condemnation or damage except as set forth in this Section. 7.4 Possession. Possession of the Property shall be delivered by Seller to Buyer on the Closing Date after recordation of the Grant Deed. All risk of loss and damage to the Property from whatever source shall be the sole responsibility of Buyer after Close of Escrow. 7.5 Relocation of Existinq Tenants. Buyer shall be solely responsible for relocating any and all existing lawful tenants on the Property. ARTICLE 8 GENERAL PROVISIONS 8.1 Assiqnment. Buyer may not assign this Agreement or any of its rights hereunder without the prior written consent of the Seller, which consent shall not be unreasonably withheld; provided, however, Buyer may freely assign its rights hereunder to the Redevelopment Agency of the City of Chula Vista. 8.2 Attornevs' Fees. If either party commences legal proceedings for any relief against the olher party arising out of this Agreement, the losing party shall pay the prevailing party's legal costs and expenses, including, but not limited to, reasonable attorneys' fees and costs as determined by the court. The prevailing party shall be that party receiving substantially the relief sought in the proceeding, whether brought to final judgment or not. 8.3 Computation of Time Periods. All periods of time referred to in this Agreement shall include all Saturdays, Sundays and state or national holidays, unless the period of time specifies business days, provided that if the date or last date to perform any act or give any notice or approval shall fall on a Saturday, Sunday or state or national holiday, such act or notice may be timely performed or given on the next succeeding day which is not a Saturday, Sunday or state or national holiday. - 8.4 Counterparts. This Agreement or any escrow instructions pursuant to this Agreement may be executed in multiple copies, each of which shall be deemed an original, but all of which shall constitute one Agreement after each party has signed such a counterpart. 8.5 Entire Aqreement. This Agreement, together with all exhibits attached hereto and other agreements expressly referred to herein, constitutes the entire agreement between the parties with respect to the purchase and sale of the Property. All prior or contemporaneous agreements, understandings, representations, warranties and statements, oral or written, are superseded. 8.6 Exhibits. All exhibits referred to herein are attached hereto and incorporated herein by reference. 9 /I f -1 - - 8.7 Further Assurances. The parties agree to perform such further acts and to execute and deliver such additional documents and instruments as may be reasonably required in order to carry out the provisions of this Agreement and the intentions of the parties. 8.8 Gender. Number. As used herein, the singular shall include the plural and the masculine shall include the feminine, wherever the context so requires. 8.9 Governinq Law. This Agreement shall be governed, interpreted, construed and enforced in accordance with the laws of the State of California. 8.10 Headinqs. The captions and paragraph headings used in this Agreement are inserted for convenience of reference only and are not intended to define, limit or affect the construction or interpretation of any term or provision hereof. 8.11 Modification. Waiver. No modification, waiver, amendment or discharge of this Agreement shall be valid unless the same is in writing and signed by both Buyer and Seller. The escrow instructions shall be considered a part of this Agreement, and no provision in said escrow instructions shall supersede or contradict the provisions of this Agreement, unless the parties agree in writing to such change. 8.12 Notice. Notice to either party shall be in writing and either personally delivered or sent by certified mail, postage prepaid, return receipt requested. addressed to the party to be notified at the address specified herein. Any such notice shall be deemed received on the date of personal delivery to the party (or such party's authorized representative) or three (3) business days after deposit in the U.S. Mail, as the case may be. Seller's Address for Notice: Buver's Address for Notice: Ms. Obdulia E. Allen 276 Fourth Avenue 3334 N. Mountain View Drive Chula Vista, CA. 91910 San Diego, Ca. 92116; and Attn: Community Development Director Ms. Christina E. Coats 1360 Pine Drive EI Cajon, Ca. 92020 Mr. Robert A. Coats 5712 Baltimore Drive, #489 La Mesa, CA 91942-1692 Either party may change its address for notice by delivering written notice to the other party as provided herein. 8.13 Severabilitv. If any term, provision, covenant or condition of this Agreement is held to be invalid, void or otherwise unenforceable, to any extent, by any court of competent jurisdiction, the remainder of this Agreement shall not be affected thereby, and each term, provision, covenant or condition of this Agreement shall be valid and enforceable to the fullest extent permitted by law. 8.14 Successors. All terms of this Agreement shall be binding upon, inure to the benefit of, and be enforceable by the parties hereto and their respective heirs, legal representatives, successors, and assigns. 8.15 Time. Time is of the essence of each provision of this Agreement, including without limitation all time deadlines for satisfying conditions and Close of Escrow. IN WITNESS WHEREOF, the parties have entered into this Agreement as of the date first written above. [Remainder of This Page Intentionally Left Blank] 10 III-Ið IN WITNESS WHEREOF, the parties have entered into this Agreement as of the date first written above. SELLER: OBDULIA E. ALLEN, an individual, tenant in common ROBERT A. COATS, an individual, tenant on common CHRISTINA E. COATS, an individual, tenant in common BUYER: CITY OF CHULA VISTA, a municipal corporation By: Shirley Horton, Mayor ATTEST Secretary APPROVED AS TO FORM BY John M. Kaheny City Attorney 11 !I(-(! LIST OF EXHIBITS A Legal Description of Property B General Escrow Conditions 13 ¡f I - (!J EXHIBIT "A" LEGAL DESCRIPTION OF PROPERTY [To be provided] A-1 /II-Ie( - . -- EXHIBIT "B" GENERAL ESCROW INSTRUCTIONS [To be provided] B-1 ,A I-IS- o. .. CONSENT OF ESCROW AGENT SELLER; OBDULIA E. ALLEN, ROBERT A. COATS, CHRISTINA E. COATS BUYER: CITY OF CHULA VISTA ESCROW NO.: The undersigned ("Escrow Agent") hereby: (1) acknowledges delivery of a Purchase and Sale Agreement and Joint Escrow Instructions ("Agreement") dated , 1997 between the Seller and Buyer identified above, and delivery of the initial $10,000 Deposit described in Section 1.4 of the Agreement; and (2) agrees to act as the Escrow Agent in accordance with the provisions of the Agreement. This Consent is executed on ,1997 which shall constitute the "Opening of Escrow" pursuant to Section 3.3 of the Agreement. ESCROW AGENT: Spring Mountain Escrow By: Escrow Officer 12 /If-I;J... -. . . Negative Declaration PROJECT NAME: Otay Gymnasium PROJECT LOCATION: 3554 Main Street, Chula Vista ASSESSOR'S PARCEL NO.: 623-230-26 PROJECT APPLICANT: City of Chula Vista CASE NO: IS-98-02 DATE: August 15, 1997 A. Project Setting The approximately 1.37 acre project site is located at 3554 Main Street. Access to the site would be directly from Main Street. Existing surrounding uses include the Otay Elementary School to the north, an SDG&E substation to the east, a vacant equipment rental yard to the west and industrial-manufacturing uses to the south across Main Street. Residential uses exist further north of the site. The project site is a graded lot with no existing native vegetation and is relatively level and at-grade with Main Street. B. Project Description The proposed project consists of a 16,000 square foot, single-story building housing a 12,000 square foot gymnasium and 4,000 square feet of support/community use areas. Also proposed on the site would be landscaping parking and signage. The facility is expected to serve approximately 250 - 300 visitors per day on average. Utility connections and drainage improvements would be provided to serve the proposed building. All utilities are accessible from Main Street. C. ComDatibilitv with Zoning and Plans The General Plan land use designation for the site is Research and Limited Manufacturing with a zoning designation of Limited Industrial. The project is considered an unclassified use and would require a Special Land Use permit to be consistent with existing designations. D. Identification of Environmental Effects An initial study conducted by the City of Chula Vista (including the attached Environmental Checklist Form) determined that the proposed project will not have a significant environmental effect, and the preparation of an Environmental Impact Report will not be required. This Negative Declaration has been prepared in accordance with Section 15070 A ol -( IS-98-02: Otay Gymnasium 2 of the State CEQA Guidelines. The attached Initial Study provides explanations for each of the checklist categories and their application to the proposed project, including areas identified as "no impact" and "less than significant impact". E. Mitigation necessarv to avoid significant effects The proposed project will not result in any significant or potentially significant environmental impacts, therefore, no project specific mitigation is required. F. Consultation 1. Individuals and Organizations City of Chula Vista; Cliff Swanson, Engineering Anne Pedder-Pease, Planning Department Ken Larsen, Director of Building & Housing Doug Perry, Fire Marshal Crime Prevention, MaryJane Diosdada Jess Valenzuela, Parks & Recreation Dept. Chula Vista City School District: Lowell Billings Sweetwater Union High School District: Andrew B. Campbell Applicant's Agent: City of Chula Vista 2. Documents Chula Vista General Plan (1989) and EIR (1989) Title 19, Chula Vista Municipal Code 3. Initial Studv This environmental determination is based on the attached Initial Study, any comments received on the Initial Study and any comments received during the public review period for this Negative Declaration. The report reflects the independent judgement of the City of Chula Vista. Further information regarding the environmental review of this project is available from the Chula Vista Planning Department, 276 Fourth Avenue, Chula Vis ta, CA 91910. ~ Envir enta Review Coordmator tI~-~ Case No. IS-98-02 ENVIRONMENTAL CHECKLIST FORM 1. Name of Proponent: City of Chula Vista 2. Lead Agency Name and Address: City of Chula Vista 276 Fourth Avenue Chula Vista, CA 91910 3. Address and Phone Number of Proponent: Same as above 4. Name of Proposal: Otay Gymnasium 5. Date of Checklist: August 15, 1997 A;¿ -3 H.IHOMEICOMMDEVIMONACOUS-98-0Z CKL Page 1 - - Po"""'" p"",;",y S;g,m"" L,.. <b,o Sig,m"" ""... Sig,'""" No Imp'" MI"g,"d Imp", Imp'" I. LAND USE AND PLANNING. Would the proposal: a) Conflict with general plan designation or 0 0 ~ 0 zoning? b) Conflict with applicable envirournental plans or D D D 181 policies adopted by agencies with jurisdiction over the project? c) Affect agricultural resources or operations (e.g., D D D 181 impacts to soils or farmlands, or impacts from incompatible land uses)? d) Disrupt or divide the physical arrangement of D 0 0 181 an established community (including a low- income or minority community)? Comments: The project is considered to be an unclassified use and therefore requires a Special Land Use permit to be consistent with existing General Plan designations and zoning. No environmental plans or policies exist in the project area that could be affected by the project. No agricultural activities exist on the project site. The project is compatible with surrounding land uses. II. POPULATION AND HOUSING. Would the proposal: e) Cumulatively exceed official regional or local 0 0 D 181 population projections? f) Induce substantial growth in an area either 0 0 181 D directly or indirectly (e.g., through projects in an undeveloped area or extension of major infrastructure)? g) Displace existing housing, especially affordable 0 0 0 181 housing? Comments: The project consists of urban infill development, and its impacts are not considered significantly growth-inducing. The project site does not contain any existing housing. II. GEOPHYSICAL. Would the proposal result in or expose people to potential impacts involving: a) Unstable earth conditions or changes in D D 181 D geologic substructures? b) Disruptions, displacements, compaction or D 0 181 0 overcovering of the soil? c) Change in topography or ground surface relief 0 D D 181 features? d) The destruction, covering or modification of D D D 181 any unique geologic or physical features? e) Any increase in' wind or water erosion of soils, 0 0 181 0 either on or off the site? fi.2-C¡ H. "iOME\eOMMDEVIMON ACOIIS-98-0' eKL Page 2 - - 0-- P""""" P"",;.II, s;"m,..1 L,.. (h,. Si"m..., V,I,.. si"m..., N, Imp", M;",,',d Imp", Imp", t) Changes in deposition or erosion of beach 0 0 ~ 0 sands, or changes in siltation, deposition or erosion which may modify the channel of a river or stream or the bed of the ocean or any bay inlet or lake? g) Exposure of people or property to geologic 0 0 ~ 0 hazards such as earthquakes, landslides, mud slides, ground failure, or similar hazards? Comments: Grading of the project site will be required to accommodate building pads, outdoor use areas and parking. This will necessarily require some excavation and fill operations. However, since the project site is relatively level, only minor grading would be required and environmental impacts associated with such grading are considered less than significant. III. WATER. Would the proposal result in: a) Changes in absorption rates, drainage patterns, 0 0 ~ 0 or the rate and amount of surface runoff? b) Exposure of people or property to water related 0 0 0 ~ hazards such as flooding or tidal waves? c) Discharge into surface waters or other alteration 0 0 0 ~ of surface water quality (e.g., temperature, dissolved oxygen or turbidity)? d) Changes in the amount of surface water in any 0 0 0 ~ water body? e) Changes in currents, or the course of direction 0 0 0 ~ of water movements, in either marine or fresh waters? t) Change in the quantity of ground waters, either 0 0 0 ~ through direct additions or withdrawals, or through interception of an aquifer by cuts or excavations? g) Altered direction or rate of flow of 0 0 0 ~ groundwater? h) Impacts to groundwater quality? 0 0 0 ~ i) Alterations to the course or flow of flood 0 0 0 ~ waters? j) Substantial reduction in the amount of water 0 0 0 ~ otherwise available for public water supplies? Comments: Measures to avoid impacts associated with stormwater runoff will be incorporated into the project as a part of standard grading plan and building plan review. These measures will include site specific drainage facilities to adequately convey anticipated runoff volumes. A õl -~ HIHOME\COMMDEYMONACO"S-98-02 CKL Page 3 - . ., - Pm"".", Pm"".", Slg,I".." Lm th.. Sig,I".." ",I.., Sig,i".." N. 'mp." Mi"g.',d Imp." Imp." IV. AIR QUALITY. Would the proposal: a) Violate any air quality standard or contribute to 0 0 0 181 an existing or projected air quality violation? b) Expose sensitive receptors to pollutants? 0 0 0 181 c) Alter air movement, moisture, or temperature, 0 0 0 181 or cause any change in climate, either locally or regionally? d) Create objectionable odors? 0 0 0 181 e) Create a substantial increase in stationary or 0 0 181 0 non-stationary sources of air emissions or the deterioration of ambient air quality? Comments: The project will increase traffic levels in the project area by less than 100 Average Daily Trips (ADT). Vehicular emissions resulting from the project are not considered significant, either on an individual or cumulative basis. V. TRANSPORT A TION/CIRCULA TION. Would the proposal result in: a) Increased vehicle trips or traffic congestion? 0 0 181 0 b) Hazards to safety from design features (e.g., 0 0 0 181 sharp curves or dangerous intersections) or incompatible uses (e.g., farm equipment)? c) Inadequate emergency access or access to 0 0 0 181 nearby uses? d) Insufficient parking capacity on-site or off-site? 0 0 0 181 e) Hazards or barriers for pedestrians or bicyclists? 0 0 0 181 t) Conflicts with adopted policies supporting 0 0 0 181 alternative transportation (e.g. bus turnouts, bicycle racks)? g) Rail, waterborne or air traffic impacts? 0 0 0 181 h) A "large project" under the Congestion 0 0 0 181 Management Program? (An equivalent of 2400 or more average daily vehicle trips or 200 or more peak-hour vehicle trips.) Comments: As mentioned above, the project will increase traffic levels in the project area by less than 100 Average Daily Trips (ADT). The impacts associated with this increase are not considered to be significant. A ~ -G. HIHOMEICOMMD EV\MONAeO"S-98-02. eKL Page 4 - - P",.".u, p"",ti,U, s"",","" Lm th.. Si""",",, V"I... Si""",",, N" Imp'" Mil'"", Imp'" Imp", VI. BIOLOGICAL RESOURCES. Would the proposal result in impacts to: a) Endangered, sensitive species, species of D D D 181 concern or species that are candidates for listing? b) Locally designated species (e.g., heritage trees)? D D D 181 c) Locally designated natural communities (e.g, D 0 0 181 oak forest, coastal habitat, etc.)? d) Wetland habitat (e.g., marsh, riparian and vernal 0 0 0 181 pool)? e) Wildlife dispersal or migration corridors? D D D 181 f) Affect regional habitat preservation planning 0 0 0 181 efforts? Comments: The project is proposed in an area previously entirely disturbed and graded. No impacts to biological resources would result from project implementation. VII. ENERGY AND MINERAL RESOURCES. Would the proposal: a) Conflict with adopted energy conservation 0 D 0 181 plans? b) Use non-renewable resources in a wasteful and 0 0 0 181 inefficient manner? c) If the site is designated for mineral resource D 0 D 181 protection, will this project impact this protection? Comments: The project would not use extraordinary amounts of energy or affect mineral resources. VIII. HAZARDS. Would the proposal involve: a) A risk of accidental explosion or release of 0 0 0 181 hazardous substances (including, but not limited to: petroleum products, pesticides, chemicals or radiation)? b) Possible interference with an emergency 0 D 0 181 response plan or emergency evacuation plan? c) The creation of any health hazard or potential D D D 181 health hazard? d) Exposure of people to existing sources of 0 0 0 181 potential health hazards? e) Increased fire hazard in areas with flammable 0 0 0 181 brush, grass, or trees? IIJ-1 H'HOMEICOMMDEVIMON ACOIls.".a2. CKL Page 5 - - .- p""""",, p"""".,,, ",","".", Lm <b." "'"'""""' V"'". "'"'""'"' No Imp.", MI<"."d Imp.", Imp.", Comments: The project does not propose activities that would include the use and storage of volatile and/or hazardous materials. IX. NOISE. Would the proposal result in: a) Increases in existing noise levels? 0 0 181 0 b) Exposure of people to severe noise levels? 0 0 0 181 Comments: Increased traffic from the proposed project and activities on the site would increase noise levels in the project vicinity. No significant impacts to any sensitive receptors would result from project implementation, nor would the project violate the City's Noise Ordinance. X. PUBLIC SERVICES. Would the proposal hove an effect upon, or result in a need for new or altered government services in any of the following areas: a) Fire protection? 0 0 0 181 b) Police protection? 0 0 0 181 c) Schools? 0 0 0 181 d) Maintenance of public facilities, including 0 0 0 181 roads? e) Other governmental services? 0 0 0 181 Comments: No new governmental services would be required to serve the project. XI. Thresholds. Will the proposal adversely impact the 0 0 0 181 City's Threshold Standards? As described below, the proposed project does not adversely impact any of the seen Threshold Standards. a) FireÆMS The Threshold Standards requires that fire and medical units must be able to respond to calls within 7 minutes or less in 85% of the cases and within 5 minutes or less in 75% of the cases. The City of Chula Vista has indicated that this threshold standard will be met, since the nearest fire station is three miles away and would be associated with a 6 minute or less response time. The proposed project will comply with this Threshold Standard. Comments: An Automatic Aid Agreement with the City of San Diego provides for response from San Diego Fire Station No.6. In addition, Fire Station No.3 in the City of Chula Vista is proposed for relocation to Sunbow, which would significantly reduce response time. A tJ. -v H .\HOME\COMMD E VIMON ACOIIS-98-02. CKL Page 6 - - .- P""""'" P""';"'" S;g';""" L... "" S;g';o"" v".., SIg';""" N, 'mp", M";g,,',d Imp"" Imp." b) Police The Threshold Standards require that police units must respond to 84% of Priority I calls within 7 minutes or less and maintain an average response time to all Priority 1 calls of 4.5 minutes or less. Police units must respond to 62.10% of Priority 2 calls within 7 minutes or less and maintain an average response time to all Priority 2 calls of 7 minutes or less. The proposed project will comply with this Threshold Standard. Comments: The Police Department has indicated that the project will not impact police services. c) Traffic The Threshold Standards require that all intersections must operate at a Level of Service (LOS) "C" or better, with the exception that Level of Service (LOS) "D" may occur during the peak two hours of the day at signalized intersections. Intersections west of 1-805 are not to operate at a LOS below their 1987 LOS. No intersection may reach LOS "E" or "F" during the average weekday peak hour. Intersections of arterials with freeway ramps are exempted from this Standard. The proposed project will comply with this Threshold Standard. Comments: The 100 or less additional trips generated by the project, would not cause Level of Service on local roadways or intersections to fall below LOS "C". d) Parks/Recreation The Threshold Standard for Parks and Recreation is not applicable. Comments: The project will relieve demand for recreational facilities in the area. e) Drainage The Threshold Standards require that storm water flows and volumes not exceed City Engineering Standards. Individual projects will provide necessary improvements consistent with the Drainage Master Plan(s) and City Engineering Standards. The proposed project will comply with this Threshold Standard. Comments: The project will be required to install all necessary drainage facilities to adequately convey runoff consistent with City Engineering Standards. f) Sewer The Threshold Standards require that sewage flows and volumes not exceed City Engineering Standards. Individual projects will provide necessary improvements consistent with Sewer Master Plants) and City Engineering Standards. The proposed project will comply with this Threshold Standard. Comments: Adequate sewer capacity exists to serve the proposed project. ,A"" -1 HIHOMEICOMMDEV\MON ACOliS-98-02. CKL Page 7 P.".",II, P",,'lolly Sig.m"., L... 'h" Sig.m,,", ".1... Sig.m"., N. Imp", Mitig..,d Imp," Imp", g) Water The Threshold Standards require that adequate storage, treatment, and transmission facilities are constructed concurrently with planned growth and that water quality standards are not jeopardized during growth and construction. The proposed project will comply with this Threshold Standard. Applicants may also be required to participate in whatever water conservation or fee off- set program the City of Chula Vista has in effect at the time of building permit issuance. Comments: Application of required water conservation devices or fee offset will reduce the project's impact to a less than significant level. The project may result in the need for new water systems or upgrades to existing systems to meet fire flow requirements. XII. UTILITIES AND SERVICE SYSTEMS. Would the proposal result in a need for new systems, or substantial alterations to the following utilities: a) Power or natural gas? 0 0 0 181 b) Communications systems? 0 0 0 181 c) Local or regional water treatment or distribution 0 0 0 181 facilities? d) Sewer or septic tanks? 0 0 0 181 e) Storm water drainage? 0 0 0 181 f) Solid waste disposal? 0 0 0 181 Comments: Extension of facilities to serve the project will be required. Existing infrastructure adequate to serve the project's needs exist on adjacent properties. XIII. AESTHETICS. Would the proposal: a) Obstruct any scenic vista or view open to the 0 0 0 181 public or will the proposal result in the creation of an aesthetically offensive site open to public view? b) Cause the destruction or modification of a 0 0 0 181 scenic route? c) Have a demonstrable negative aesthetic effect? 0 0 0 181 d) Create added light or glare sources that could 0 0 181 0 increase the level of sky glow in an area or cause this project to fail to comply with Section 19.66.100 of the Chula Vista Municipal Code, Title 19? e) Produce an additional amount of spill light? 0 0 181 0 A;.. -/ () HIHOMEICOMMDEVIMON ACO"5.98.O2. CKL Page 8 - - Po"",.II, Po'""',II, S;g,;fi"" em <h" S;g,ifi,,", ",;", Sig,ifi"" No Impo" M;"g,,"d Imp." 'mp." Comments: The project will result in construction of a single-story building and parking areas. The project will be subject to design review. Due to the location, nature and size of the proposed project, and application of the design review process, the project is not anticipated to result in any significant impacts to visual resources or to produce any significant adverse light and glare impacts. XIV. CULTURAL RESOURCES. Would the proposal: a) Will the proposal result in the alteration of or 0 0 0 181 the destruction or a prehistoric or historic archaeological site? b) Will the proposal result in adverse physical or 0 0 0 181 aesthetic effects to a prehistoric or historic building, structure or object? c) Does the proposal have the potential to cause a 0 0 0 181 physical change which would affect unique ethnic cultural values? d) Will the proposal restrict existing religious or 0 0 0 181 sacred uses within the potential impact area? e) Is the area identified on the City's General Plan 0 0 181 0 EIR as an area of high potential for archeological resources? Comments: The project site is highly disturbed, graded and surrounded by development. No impacts to cultural resources would result from project implementation. XV. PALEONTOLOGICAL RESOURCES. Will the 0 0 181 0 proposal result in the alteration of or the destruction of paleontological resources? Comments: No known paleontological resources exist on the site. The project would not result in any significant impacts to paleontological resources. XVI. RECREATION. Would the proposal: a) Increase the demand for neighborhood or 0 0 0 181 regional parks or other recreational facilities? b) Affect existing recreational opportunities? 0 0 0 181 c) Interfere with recreation parks & recreation 0 0 0 181 plans or programs? Comments: The project would provide facilities for recreational purposes, fulfilling a need for such facilities for community residents. A,¡ -( I HIHOMEleOMMO EVIM ON ACOUS-98-II'. en Page 9 - - Po"""'" P.".'I.", Sig.lfim' E", <b.. 'Ig.m"., V.I", Sig.lfi"., N. Imp." MI<lg."d Imp." Imp." XVII. MANDATORY FINDINGS OF SIGNIFICANCE: See Negative Declaration for mandatory findings of significance, If an EIR is needed, this section should be completed. a) Does the project have the potential to degrade 0 0 0 181 the quality of the environment, substantially reduce the habitat of a fish or wildlife species, cause a fish or wildlife population to drop below self-sustaining levels, threaten to eliminate a plant or animal community, reduce the number or restrict the range of a rare or endangered plant or animal or eliminate important examples of the major periods or California history or prehistory? Comments: None of the impacts resulting from the project are not considered significant and the project as a whole would not degrade the environment or substantially affect any biological habitats or cultural resources. b) Does the project have the potential to achieve 0 0 0 181 short-term, to the disadvantage of long-term, environmental goals? Comments: The scope and nature of the project would not result in the curtailment of any long-term environmental goals. c) Does the project have impacts that are 0 0 181 0 individually limited, but cumulatively considerable? ("Cumulatively considerable" means that the incremental effects of a project are considerable when viewed in connection with the effects of past projects, the effects of other current projects, and the effects of probable future projects.) Comments: No cumulative effects would result from this project. d) Does the project have environmental effect 0 0 0 181 which will cause substantial adverse effects on human beings, either directly or indirectly? Comments: The project is not of sufficient size or scope to cause any such impacts. 11d. -/~ H\HOME\COMMDEVIMON ACO\IS-98-OZ. eKE Page 10 -. -- ENVIRONMENTAL FACTORS POTENTIALLY AFFECTED: The environmental factors checked below would be potentially affected by this project, involving at least one impact that is a "Potentially Significant Impact" or "Potentially Significant Unless Mitigated," as indicated by the checklist on the following pages. D Land Use and Planning D Transportation/Circulation D Public Services D Population and Housing D Biological Resources D Utilities and Service Systems D Geophysical D Energy and Mineral Resources D Aesthetics D Water D Hazards D Cultural Resources D Air Quality D Noise D Recreation D Mandatory Findings of Significance DETERMINATION: On the basis of this initial evaluation: I find that the proposed project COULD NOT have a significant effect on the environment, and . a NEGATIVE DECLARATION will be prepared. 1 find that although the proposed project could have a significant effect on the environment, D there will not be a significant effect in this case because the mitigation measures described on an attached sheet have been added to the project. A MITIGATED NEGATIVE DECLARATION will be prepared. I find that the proposed project MAY have a significant effect on the environment, and an D ENVIRONMENTAL IMPACT REPORT is required. I find that the proposed project MAY have a significant effect(s) on the environment, but at least D one effect: I) has been adequately analyzed in an earlier document pursuant to applicable legal standards, and 2) has been addressed by miligation measures based on the earlier analysis as described on attached sheets, if the effect is a "potentially significant impacts" or "potentially significant unless mitigated." An ENVIRONMENTAL IMPACT REPORT is required, but it must analyze only the effects that remain to be addressed. EnviQz~ ¿Jp:;- /97 Date Ad -/~ H IHOM EICOMM D EVIMaN ACOIIS-98-02. CK L Page II - . -,- NOTICE OF INITIAL STUDY NOTICE IS HEREBY GIVEN that the Environmental Review Coordinator of the City of Chula Vista is conducting an Initial Study (IS) to detennine if the project identified and described below will have a significant impact on the environment. If the project may have a significant effect on the environment, . an Environmental Impact report will be prepared to evaluate the environmental consequences of the project. If the project will not have significant environmental impact or if mitigation measure have been included in the project which will avoid any significant impacts, a Negative Declaration will be prepared. This determination does not constitute approval or rejection of the project. This IS application, project description and other material are on file and available for public review at the Chula Vista Planning Department, Public Services Building, 276 Fourth Avenue, Chula Vista, California 91910. Any Comments on this Initial Study must be presented in writing to the Environmental Review Coordinator, P.O. Box 1087, Chula Vista, California, 91912, prior to 5:00 p.m. on August 1, 1997 If you have any questions or comments on this IS; please call the Environmental Projects Manager of the Community Development Department at (619) 691-5016. Project Description: ConstructIon of a 16,000 sq. ft. building with a 12,000 sq. ft. gymnasium and 4,000 sq. ft. support/community use component. Project Location: 3554 Main Street Project Applicant: City of Chula Vista, Joe Monaco, Community Development Dept. Æ~e~ Environmental Review Coordinator Date: July 18, 1997 Case No: 18-98-02 (En'. not) /l~ -rV - . --- i . I I' I ¡ c-/ /'" / '; I II LlJ--.LL1 I ~~,... ,.C,. ." "~'" " / :, i I l'y -". ¡' ", MONTGOMERY ST t '. 0 / ;! ¡ ¡ i , 0 " . 'I .-:.. " ¡ I , I "0 ! - , I I I! I ¡ r /f ~ . : $INGLEFAMILY I ¡ III' f \: '..1 I RESIDE~CESI Ii::: Lei (\ I ;, CO . "', "-,- I ' . ~f", . . OTAY ~..,«, . ~ " ._,S"'~--., -.' ELEMENTARY ~~~ .... " mo,::ì;'¡" IITID; , " ,SCNOOL,-r-. ""'CT", S. 'E'",I-¡! SlDRAGE 0°0 'Le, ' ~ '1T't:-UL..'- ..J 1;: 0 8ÇH I , -(L' PROJECT. ~ I ZENITH ST LOCATIO '.Ii ' I ~ '1m I I I I ' ~ ,j 'SERVICE , SINGLE FAMIL~ I ~. ~, I I ""0 ¡ RESIDEÍlCESf---j . "~'1 . I I I I ! " ~y --LLLL.J . SDG & E VAlENCIA I ' ALlE' SUBSTATIION OŒSEL I I MOBIlE LI~~DE OFFICES I ¡ - I ¡ IllUlAJlffiAL ! ¡ mor¡ MAIN ST I I ' " , AfFORDABLE BURRO I CLB I :! TIRES A""CAN RESrAURAHr "RAIE' MFA ¡rlllwr i, BERor I 4 11!wœG EQUIPMENr I, I' lESS "",~ING I, I ! PAX~ON CEIfYER to ¡ ! I -- .~ ~ I' [ Sf REc~~I.., I GLENVIEW TOWING ACTION AUTO WRECKING ; ~ i CHULA VISTA PLANNING DEPARTMENT LOCATOR PRO.JECT City 01 Chula Vista PROJECT DESCRIPTION: Œ) APPUCANT: INITIAL STUDY ~ 3554 Main Street Request; Proposal for construction of a 16,000 sq. ft. building with a 12,000 sq. ft. gymnasium and a 4,000 SCALE: I ALE NUMBER: sq. ft. support community use component. NORTH No Scale I IS-98-o2 h:lhomelplanning\carlos\locators\ls9802.cdr 7/15/97 //;l -/ ~ SWEETWATER UNION HIGH SCHOOL DISTRICT ADMINISTRATION CENTER 1130 FIFTH AVENUE CHULA VISTA, CALIFORNIA 91911 (619) 691-5553 ~e DivisionojPlanningandFacilities _e- -7;997 --- - - ------\ J\-- ---==-'-:-:- \ .--""7 ) July31,1997 \ --lì':::"j¡ \ \ l- --1 \ - I Mre Douglas D. Reid ------ Environmental Review Coordinator City ofChula Vista 276 Fourth Avenue Chula Vista, CA 91910 Dear Doug: Re: 16,000 Square Foot Gymnasium/Community Use Facility 3554 Main Street Since the above referenced project is tax exempt, pursuant to California Government Code 65995, they are also exempt from paying school impact fees. Thank you for the opportunity to comment. Sincerely, M~~ Director of Planning KW/sf /I~-(Cø - . -. , AITACHMENT D I r (S:;7 --.-,.-- -I. f' . c ~ . ,/ '1, ,/ ~//' ,/: '.' : ",,:,' l' t>o ¡:q""¡ ',¿¡ ~ -/7 J: /cJò/t( J.1.FW/JLk Ti-JRtJU6¡! T//é ST/fëET5) Our T//£ (}O65 <Jéll!?i:!;) Me p LOT /-?A//.? 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REEVES SECRETARY Subject: WATER AVAILABILITY PROPOSED 16,000 SF BUILDING 3554 MAIN STREET, CASE NO: IS-98-02 SWA Gen. File: Water Availability, 1997 Dear Mr. Reid: This letter is in response to your Notice of Initial Study for the subject project within the Sweetwater Authority service area. There is an 8-inch water main located on the north side of Main Street adjacent to the proposed development. Our records indicate that there is one water service to this property. Enclosed is a copy of 1/4 SEC. 23-B map which shows the existing water facilities. At this time, we cannot comment on the adequacy of the existing system to provide fire protection for this project. As plans develop for structures, the Owner must submit a letter to the Authority from the appropriate fire agency stating fire flow requirements. Based on this requirement, this project may result in the need for new water systems or substantial alteration to the existing water system. The Authority recommends that your Agency work with ours to determine if the existing water facilities are adequate to meet the added demands prior to issuing a building permit. If the Owner provides the required fire flow information and enters into an agreement for water facility improvements with the Authority, water service can be obtained at a pressure ranging from a maximum of 80 p.s.i. to a minimum of 70 p.s.i. If you have any questions, please contact Mr. Russell Collins at 422-8395, ext. 639. Very truly yours, SWEETWATER AUTHORITY / J,~ ames L. Smyth Chief Engineer /I).. -~ I A Public Agency, Serving National City, Chula Vista and Surrounding Areas - - enclosure: photocopy of 1/4 SEC. 23-8 map pc: Joe Monaco City of Chula Vista Community Development Department 276 4th Avenue Chula Vista, CA 91910 i:\engJ>ool\3554main.wat Ad) -~~ - . .- r "." ." ~~J:8'.?'_"_"--_,, '_'1""-'~ ~~~I ~<:"::'::" .é.;..:A),:) Ii ~ ,m . - '" ~~ ii " ,~.m " '" N ~'~ " '" . ~~~ II «, I co '¡ig,~ g~~ -l'~ ~~~:n, .:¿ ~ ',: - ,h~I' -l J ,"'" . t~,~k J 1 ~' "..,. I ~. //.' . / / II /,/ / / / - . J ~ ~. OH, 'n / ,/ . / /' /// ;, 00.'-22).0 ~'/ / / 'I'~/ MAIN/ - , . ,,-ON 1m' ,-,c ,m '0) . 23-A ¡..=. f----- ---,-- - ..---........-..:-_c ------, ~ ~ I ~ :::~.~:~:::;::;:.::~ "::.:~...... . "'°." .. .m- """", ,.'" """'."-', - d " ~ I ~ I ~ <1 U ~~ ~ 0,0-""" ADD IT t N ~<.2? --B r- \-'--=0 3 (f) ~ !- ~..'" ~ "'" w -': "",¡!:,'U " 0O....., <C ' TO 0 AY :2 4 8 5 6 w 0:: ,1.-;13 . - . - - ~ I " ¡ , : ¡ q¡ ,; ¡, I:. "I :. !. ¡¡ ¡ ¡. 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