Loading...
HomeMy WebLinkAboutRDA Packet 2005/02/15 ~~f? -tl- . - --- =~ - -- CIlY OF CHULA VISTA TUESDAY, FEBRUARY 15, 2005 6:00 P.M. (immediately following the City Council meeting) COUNCIL CHAMBERS PUBLIC SERVICES BUILDING MEETING OF THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA CALL TO ORDER ROLL CALL Agency Members Castaneda, Davis, McCann, Rindone; Chair Padilla CONSENT CALENDAR The staff recommendations regarding the following item(s) listed under the Consent Calendar will be enacted by the Agency/Council by one motion without discussion unless an Agency/Council member, a- member of the public or City staff requests that the item be pulled for discussion. If you wish to speak on one of these items, please fill out a "Request to Speak Form" available in the lobby and submit it to the Secretary of the Redevelopment Agency or the City Clerk prior to the meeting. Items pulled from the Consent Calendar will be discussed after Action items. Items pulled by the public will be the first items of business. 1. APPROVAL OF MINUTES - November 23, 2004, January 11, 2005 2. RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA APPROVING AN OWNER PARTICIPATION AGREEMENT WITH SUNROAD CV AUTO. INC. FOR THE OPERATION AND MAINTENANCE OF A CHULA VISTA TOYOTA DEALERSHIP - Chula Vista Toyota will be the first of several new dealerships that will be built and operated pursuant to the City's Auto Park East and Auto Park North Specific Plans. The Sunroad OPA, together with the Master OPA for Auto Park East (adopted by City Council on August 24, 2004), will establish a foundation and set the stage for the comprehensive operations and maintenance of "first quality, first class" auto dealerships within the Chula Vista Auto Park. [Community Development Director] STAFF RECOMMENDATION: Agency adopt the resolution. 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 n 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. OTHER BUSINESS 3. DIRECTOR'S REPORT 4. CHAIR REPORT 5. AGENCY COMMENTS ADJOURNMENT The meeting will adjourn to a regular meeting of the Redevelopment Agency on March 1, 2005, at 4:00 p.m., immediately following the City Council meeting in the City Council Chambers. AMERICANS WITH DISABILITIES ACT The City of Chula Vista, in complying with the Americans with Disabilities Act (ADA), request individuals who require special accommodates to access, attend, and/or participate in a City meeting, activity, or service request such accommodation at least 48 hours in advance for meetings and five days for scheduled services and activities. Please contact the Secretary to the Redevelopment Agency for specific information at (619) 691-5047 or Telecommunications Devices for the Deaf (TOO) at (619) 585-5647. California Reiay Service is ,also available for the hearing impaired. Redevelopment Agency, February 15, 2005 Page 2 MINUTES OF ADJOURNED REGULAR MEETINGS OF THE CITY COUNCIL AND THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA November 23, 2004 6:00 p.m. Adjourned Regular Meetings of the City Council and the Redevelopment Agency of the City of Chu1a Vista were called to order at 7:28 p.m. in the Council Chambers, located in the Public Services Building, 276 Fourth Avenue, Chula Vista, California. ROLL CALL: PRESENT: ABSENT: Agency/Councilmembers: Davis, Rindone, Salas, and Chair/Mayor Padilla Agency/Councilmembers: McCann ALSO PRESENT: Executive Director/City Manager Rowlands, City Attorney Moore, and City Clerk Bigelow CONSENT CALENDAR 1. APPROVAL OF MINUTES of September 21, 2004 and October 26, 2004 Staff recommendation: Council/Agency approve the minutes. 2. COUNCIL RESOLUTION NO. 2004-382 AND AGENCY RESOLUTION NO. 1899, RESOLUTION OF THE CITY COUNCIL AND THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA APPROVING THE SECOND AMENDMENT TO THE AGREEMENT WITH ADVOCATION INCORPORATED, EXERCISING THE CITY'S OPTION TO EXTEND THE CONTRACT FOR THE 2005-2006 LEGISLATNE SESSION, AND AUTHORIZING THE MAYOR/CHAIR TO EXECUTE THE SECOND AMENDMENT ON BEHALF OF THE CITY OF CHULA VISTA On December 31, 2004, the current agreement with Advocation Incorporated expires. This agreement was for the provision of legislative representation in Sacramento throughout the 2003-2004 legislative session. Based on the fInn's success in promoting Chula Vista's legislative agenda, staff recommends exercising the City's option to extend this contract. (Director of Community Development) Staff recommendation: Council/Agendy adopt the resolution. ACTION: Chair/Mayor Padilla moved to approve staff's recommendations and offered the Consent Calendar, headings read, texts waived. The motion carried 4-0 with Councilmember McCann absent. ORAL CO:MMUNICATIONS There were none. 1-1 ACTION ITEMS 3. CONSIDERATION OF THE FORMATION OF A 50l(c)3 PUBLIC BENEFIT CORPORATION FOR PURPOSES OF CONDUCTING REDEVELOPMENT AND PLANNING ACTMTIES WITHIN THE URBAN CORE PLANNING AND REDEVELOPMENT AREAS OF CHULA VISTA On February 3, 2004, the Council directed staff and consultants to prepare an analysis and discussion paper on the creation of a SOI(c)3 Redevelopment Corporation. As part of the preparation for this report, two facilitated workshops were held on the formation of the corporation. A detailed report was distributed to the Council and the public on July 20, 2004. The report builds upon the conclusions and recommendations from the workshops, the July report and a recent legal analysis prepared by Rutan and Tucker, LLP, attorneys, on behalf of the City Attorney's Office. (Director of Community Development) Assistant City Attorney Hull reported that the Fair Political Practices Commission has advised that, although Deputy Mayor Salas and Councilmernber Rindone both own real estate on the western side of the City, since these discussions are solely procedural, focused on the structure of an alternative agency, there is no conflict of interest with the properties they own. In addition, the nature of the Councilmembers' real estate holdings are such that a previously supplied opinion indicates that their participation would fall within the general public exception. Community Development Director Madigan presented the SOl(c)3 report. Steve Molski opposed the formation of the corporation, stating that the City does not need another agency since it has qualified Planning Commissioners and staff. He cautioned against creating a monstrous bureaucracy and associated expenses. Mayor Padilla clarified that the City would not be creating another agency but, rather, changing an existing agency, and in so doing, creating a streamlined process. Norma Cazares, President of South Bay Forum, expressed concern about the inadequacy of public noticing on the item and asked the Agency not to approve the formation of a non-profit corporation since it would be a disservice to the members of three commissions that are proposed to be eliminated from the process. She stated that citizens should be encouraged to participate more in civic matters, not less. She asked Deputy Mayor Salas not to blemish her well- established record of encouraging public participation through boards and commissions by voting to eliminate the three commissions from the redevelopment corporation process. She asked the Agency/Council to continue on its path of inclusiveness and transparency, to hold public workshops regarding the 501 (c)3 plan, and to keep doing good things for the community. Chris Lewis, Chair of the Chula Vista Urban Development Committee, commended the Council and staff for its research and stated that the proposed plan should be a flexible tool for redevelopment, with room for evolutionary processes. He believed that a combination of public and private entities would create a synergy that would attract investment to the City, creating cash flow, income and revenues to allow the City to continue with redevelopment without tapping into general funds and allowing investors to help pay the way. He stated that the proposed plan is a good initial step in the process. Page 2 Council/RDA Minutes 11/23/04 1-2 ACTION ITEMS (Continued) John Chavez asked the Council to defer voting on the item since he believed there had not been adequate public noticing. He was perplexed that this item was not mentioned at any of the numerous Urban Core Specific Plan meetings and believed that significant expertise within the City's current commissions would be bypassed. Mr. Chavez asked the Council to continue to respect and engage the public and allow sufficient time for public dialogue. Lupita Jiminez stated that citizens believe that development needs to be sustainable both environmentally and economically. Citizens are not convinced that the Council has considered the true costs of growth, environmentally, socially and economically. She stated that by eliminating consideration and analysis by the City's Resource Conservation, Design Review, and Planning Commissions, a part of community expertise and input is being eliminated. She stated that citizens must have a voice in the City's growth, and she requested that the /Council defer its vote and proceed with timely community outreach efforts. Lisa Cohen, representing the Chula Vista Chamber of Commerce, spoke m support of the proposed plan. Patricia Aguilar encouraged the Council to direct staff to begin a dialogue with the community on operating rules of the structure to ensure that there exists frequent and early opportunity for the public to have its say, prior to the formation of the 501(c)3. Pamela Bensoussan recommended that the Council proceed cautiously with the plan and expressed concern that eliminating the review process by three advisory commissions could result in a disconnect with the community. She urged the Council to consider appointing a delegate from each of the three advisory commissions to fill seats on the proposed corporation's board and expressed the need to strive for maximum citizen participation. Ms. Bensoussan also recommended placing the Historic Preservation Plan on a fast track. Sandy Duncan expressed concern about the 501(c)3 process, stating that there was insufficient noticing and information regarding the meeting. She asked the Council to defer action to allow for further public input and asked that citizens be notified of any meetings about the plan. Ms. Duncan also requested that local citizens be appointed to the corporation's board. Frank Zimly suggested that the plan be presented to residents who reside in the urban core. Deputy Mayor Salas expressed the need to move forward with the plan, stating that the Council will continue to engage the public in future discussions of the plan. Councilmember Rindone stated that change must occur in the downtown core to provide attractions and investment opportunities, and the proposed plan would jump start the development of the urban core. Mayor Padilla stated that the best public policy is to have all redevelopment areas under the same umbrella process for purposes of procedure, planning, legal and financial. He stated that the proposed plan provides the Council with the ability to move forward. Page 3 CouncilJRDA Minutes 11/23/04 1-3 ACTION ITEMS (Continued) Deputy Mayor Salas asked about areas being adopted by resolution and about multiple projects coming forward at one time. City Attorney Moore clarified that the recommendation by staff on the item is a two-step process that allows for the eventual flexibility to change territorial boundaries by resolution or ordinance and to direct staff to provide an analysis to be brought back to the Council in April 2005 to consider areas to be included in the initial formation of the corporation. Councilmember Davis stated that the proposed plan would not impede public input, and people on the west side of the City deserve the benefits to be derived from the development of the urban core. Mayor Padilla expressed the need to revitalize the City's core, connect the east and west regions of the City, incorporate public input, and respect the uniqueness of the City by preserving and enhancing its heritage. He also commented on the need to create a balanced community of investment, jobs, and housing, stating that a purpose, plan, and streamlined process must take place in order to develop a successful urban core in the City. ACTION: Mayor Padilla then offered Council Resolutions 2004-383 and 2004-384 and Agency Resolutions 1900 and 190 I, headings read, texts waived: COUNCIL RESOLUTION NO. 2004-383 AND AGENCY RESOLUTION NO. 1900, RESOLUTION OF THE CITY COUNCIL AND THE REDEVELOPMENT AGENCY OF THE CITY OF ClillLA VISTA (1) AUTHORIZING THE FORMATION OF A SOl (c)3 PUBLIC BENEFIT CORPORATION FOR PURPOSES OF CONDUCTING REDEVELOPMENT AND PLANNING ACTMTIES; (2) DIRECTING STAFF TO PREPARE NECESSARY LEGAL DOCUMENTS NEEDED FOR THE SOl (c)3 FORMATION; (3) APPROPRIATING FISCAL YEAR 2004-2005 OPERATING BUDGET AND COMPENSATION SCHEDULE FOR THE 501 (c)3 BOARD OF DIRECTORS; AND (4) DIRECTING CITY STAFF AND THE CITY ATTORNEY TO REPORT BACK TO THE CITY COUNCIL BY APRIL 2005 WITH DRAFT LEGAL AND OPERATING DOCUMENTS COUNCIL RESOLUTION NO. 2004-384 AND AGENCY RESOLUTION NO. 1901, RESOLUTION OF THE CITY COUNCIL AND THE REDEVELOPMENT AGENCY OF THE CITY OF ClillLA VISTA DIRECTING STAFF TO RETURN BY APRIL WITH RECOMMENDATIONS ON THE TERRITORY BOUNDARIES OF THE ALTERNATIVE AGENCY STRUCTURE IF APPROVED The motion carried 4-0. Page 4 CouncilJRDA Minutes 11/23/04 1-4 OTHER BUSINESS 4. DIRECTOR/CITY MANAGER'S REPORTS There were none. 5. CHAIRIMA YOR'S REPORTS There were none. 6. AGENCY/COUNCILMEMBER CO:MMENTS There were none. ADJOURNMENT At 9:00 p.m., Chair/Mayor Padilla adjourned the meeting to a Regular Meeting of the Redevelopment Agency on December 7, 2004, at 4:00 p.m., immediately folloyving the City Council Meeting in the Council Chambers. ~ ~W. ~g'~ Susan Bigelow, MMC, City Clerk Page 5 Counci1lRDA Minutes 11/23/04 1-5 MINUTES OF ADJOURNED REGULAR MEETINGS OF THE CITY COUNCIL AND THE REDEVELOPMENT AGENCY AND A SPECIAL MEETING OF THE PUBLIC FINANCING AUTHORITY OF THE CITY OF CHULA VISTA January 11, 2005 6:00 P.M. Adjourned Regular Meetings of the City Council and the Redevelopment Agency and a Special Meeting of the Public Financing Authority of the City of Chula Vista were called to order at 7 :44 p.m. in the Council Chambers, located in the Public Services Building, 276 Fourth Avenue, Chula Vista, California. ROLLCALL PRESENT: Agency/Authority/Councilmembers Castaneda, Davis, McCann, Rindone, and Chair/Mayor Padilla ABSENT: Agency/ Authority/Councilmembers: None ALSO PRESENT: Executive Director/City Manager Rowlands, Agency/Authority/ City Attorney Moore, City Clerk Bigelow CONSENT CALENDAR 1. AUDITED FINANCIAL STATEMENTS FOR FISCAL YEAR ENDED JUNE 30, 2004 Presented for Council/Agency/Authority information and acceptance were the Audited Financial Statements for the fiscal year ended June 30, 2004, as prepared by the independent audit firm of Caporicci & Larson. Both the City and Agency's Annual Financial Reports received unqualified (clean) opinions from the independent audit firm. (Director of Finance/Treasurer) Staff recommendation: Council/Agency/Authority accept the fiscal year 2003-2004 Financial Statements. ACTION: Agency/Authority/Councilmember Rindone moved to approve staff's recommendation and offered the Consent Calendar, heading read, text waived. The motion carried 5-0. ORAL COMMUNICATIONS There were none. ACTION ITEMS 2. CONSIDERATION OF A CITY COUNCIL AND REDEVELOPMENT AGENCY WORKSHOP TO ALLOW THE COUNCIL AND AGENCY THE OPPORTUNITY TO HEAR FROM THE PUBLIC IDEAS ON EFFECTIVE MEANS FOR INCLUDING PUBLIC INPUT INTO THE 501(c)3 PROCESS 1-6 ACTION ITEMS (Continued) For over two years, the Council and Redevelopment Agency have been engaged in dialogue relating to the potential to reorganize planning and redevelopment functions within the urban core and redevelopment areas of the City. In February 2004, a critical public workshop held by the City Council and Redevelopment Agency resulted in direction to staff to prepare an analysis and discussion paper on the creation of a 501(c)3 Redevelopment Corporation. As part of the preparation for this report, the Community Development Department staff conducted research, and two facilitated workshops were held. The Report on the Formation of the Chula Vista 501(c)3 Corporation was issued to the City Council and Redevelopment Agency, and made available to the public, on July 20, 2004. (Director of Community Development) Mayor Padilla stated that the 501(c)3 Redevelopment Corporation has been a public and transparent process that has included the public as well as members of the City's Commissions. He stated that input, knowledge, concerns, and expertise from the City's Boards, Commissions and Committees would be part and parcel of the creation of the Urban Core Specific Plan, which will lay out in detail how those areas should be developed. Mayor Padilla expressed the need for greater public outreach and input in the process. Kevin O'Neill urged the Council to include the City's Commissions in the public workshop process, stating that Con1mission members have experience and training, at no cost to the City. He believed that the Commissioners would be the Council's best allies in the 501(c)3 process. Mayor Padilla suggested that the Planning Commission, Design Review Committee, and Resource Conservation Commission be formally invited, along with community interest groups, to participate in the proposed Council/Agency workshop. Councilmember McCann spoke in support of conducting public workshops and improving the public input process. He also suggested that noticing for the workshops be extended beyond the required boundaries. Councilmember Rindone supported seeking ways to foster the greatest amount of input and community support. Councilmember Castaneda suggested inclusion of the City's Commissions in at least one of the future public workshops, which he believed would provide valuable viewpoints for the Council and Agency. Deputy Mayor Davis stated that a special outreach effort must be made to ensure public input, as well as that of City Commissions, in the process. Mayor Padilla suggested a Council/Agency workshop, with participation to include Commissioners, community groups, and the community at large. Councilmember McCann suggested that announcements of the proposed workshops be placed in the Star News and Union Tribune for broader public outreach. Councilmember Castaneda suggested that time be permitted during the proposed workshops for Commissions to provide presentations or proposals to the Council and Agency. Page 2 CouncilJRDAJPF A Minutes 01/11/05 1-7 ACTION ITEMS (Continued) ACTION: Mayor Padilla then offered Council Resolution No. 2005-010 and Redevelopment Agency No. 1902, heading read, text waived: RESOLUTION NO. 2005-010 AND AGENCY RESOLUTION NO. 1902, RESOLUTION OF THE CITY COUNCIL AND THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA DIRECTING COMMUNITY DEVELOPMENT STAFF TO CALENDAR A CITY COUNCIL AND REDEVELOPMENT AGENCY WORKSHOP TO ELICIT INPUT AND DIRECTION FROM THE COUNCIL AND AGENCY, AND TO ALLOW THE COUNCIL AND AGENCY THE OPPORTUNITY TO HEAR FROM THE PUBLIC IDEAS ON EFFECTNE MEANS FOR INCLUDING PUBLIC INPUT INTO THE 501(C)3 PROCESS The motion carried 5-0. OTHER BUSINESS 3. DIRECTOR/CITY MANAGER'S REPORTS There were none. 4. CHAIR/MAYOR'S REPORTS There were none. 5. AGENCY/COUNCILMEMBER COMMENTS There were none. ADJOURNMENT At 8:31 p.m., Chair/Mayor Padilla adjourned the Special Meeting of the Public Financing Authority until further notice; and the Adjourned Regular Meeting of the Redevelopment Agency to a Regular Meeting on February 1, 2005, at 4:00 p.m., immediately following the City Council Meeting in the Council Chambers. ~ ~~ ~f5~ Susan Bigelow, MMC, City Clerk Page 3 CounciVRDAlPF A Minutes 1-8 01/11/05 PAGE 1, ITEM NO.: MEETING DATE: 02/15/05 REDEVELOPMENT AGENCY AGENDA STATEMENT ITEM TITLE: RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA APPROVING AN OWNER PARTICIPATION AGREEMENT WITH SUNROAD CV AUTO, INC. FOR THE OPERATION AND MAINTENANCE OF A CHULA VISTA TOYO DEALERSHIP SUBMITTED BY: COMMUNITY DEVELOPMENT DIRECTOR lJt I- 1M REVIEWED BY: EXECUTIVE DIRECTOR ~ BACKGROUND 4/5THS VOTE: YES 0 NO D The Owner Participation Agreement ("OPA") with Sunroad CV Auto, Inc. ("Sunroad") presented this evening represents a significant milestone in the long-term efforts of the Chula Vista Redevelopment Agency ("Agency") to innovatively and effectively plan for the City's expanding auto park. The OPA will guide the operation and maintenance of a proposed Toyota auto dealership consisting of a 52,923-square-foot building (showrooms, administrative offices, service area, etc.), a service reception area, lube center, and carwash facility. Chula Vista Toyota will be the first of several new dealerships that will be built and operated pursuant to the City's Auto Park East and Auto Park North Specific Plans. The Sunroad OPA, together with the Master OPA for Auto Park East (adopted by City Council on August 24, 2004), will establish a foundation and set the stage for the comprehensive operation and maintenance of "first quality, first class" auto dealerships within the Chula Vista Auto Park. RECOMMENDATION Staff recommends that the Redevelopment Agency of the City of Chula Vista adopt the attached resolution approving the Owner Participation Agreement with Sunroad CV Auto, Inc. for the operation and maintenance of a Chula Vista Toyota dealership. BOARDS/COMMISSIONS RECOMMENDATION Not applicable. DISCUSSION During the past several years, the Agency has proactively planned for the development and expansion of the auto park along the Main Street corridor east of the 1-805 Freeway between Brandywine Avenue and Maxwell Road. As part of those planning activities, Agency and City 2-1 PAGE 2, ITEM NO.: MEETING DATE: 02/15/05 staffs have worked closely with existing auta dealerships, prospective dealerships, and master developers to coardinate the many moving parts that will facilitate the ongoing development and expansion of the auto park in. Chula Vista. With respect to the Sunroad property and the Toyota dealership, a number of prior Agency and City Council approvals have preceded the current proposed OPA: . On June 1, 2004, the City adopted a Mitigated Negative Declaration (IS-02-01 0) for the Auto Park East project and specific plan, including all future dealership-specific projects (e.g. Toyota). . On June 8, 2004, the City adopted Ordinance No. 2965 adopting a specific plan (PCM- 02-10) for the 29-acre Auto Park East property. The Specific Plan establishes the City's land use policies and entitlements that govern the 29-acre Auto Park East property and all future auto dealerships within. . On August 2, 2004, the City's Design Review Committee, pursuant to the Specific Plan, reviewed and approved the developer's proposed design concepts for the Toyota dealership with a condition that the height of the proposed tower element be reduced. During the next few weeks, Agency staff helped facilitate discussions between Sunroad and existing dealership owners regarding fair and consistent land use policies and design guidelines among the existing and future dealerships. Consistent with those discussions, the developer announced at the August 24, 2004 Agency meeting their agreement to reduce their tower element from 100' to 80'. On August 24, 2004, the Agency approved modified site plans that included the lower tower element. . At the Agency's August 24, 2004 meeting, the Agency approved a Master Owner Participation Agreement ("OPA") with Fred Borst, Borst Family Trust, Fask land, Inc., establishing development standards and performance requirements for the 29 acres of territory within the Auto Park East Specific Plan. The Master OPA sets forth a number of developer obligations of both the existing master developer and future individual developers and dealership owners, such as Sunroad and the Toyota auto dealership. The Master OPA and the proposed Sunroad OPA will concurrently guide the development, maintenance, and operation of the Sunroad property as a "first quality, first class" auto dealership. The Sunroad OPA will ensure a "first quality, first class" Toyota dealership through the imposition and purchase by the Agency of various restrictive and limiting operating covenants on the property and dealership, including specified development obligations, maintenance requirements, non-discrimination covenants, and restrictive operating covenants. In exchange for the developer's acceptance and compliance of those requirements and restrictions on the land, and the development and maintenance of the property as a "first quality, first class" auto dealership, the Agency will agree under the OPA to make quarterly payments to the developer calculated as a percentage of the City's share of net sales tax revenues generated by the project. The structure of the monetary disbursements and conditions of disbursement are further described below. 2-2 PAGE 3, ITEM NO.: MEETING DATE: 02/15/05 Disbursement Structure and Schedule Quarterly disbursements will be made by the Agency to the developer in accordance with a pre- determined schedule of disbursements (Exhibit "C" of the OPAl. The schedule outlines the percentage of the City's share of net sales tax revenues it will disburse to the developer during each year of the first seven years of operation of the auto dealership. See below table. Year of Disbursement Amount"" Operation" 1 50% 2 50% 3 50% 4 50% 5 25% 6 25% 7 25% -Disbursements will be distributed each quarter, commencing with the second quarter after Developer has commenced operations. ."'Disbursement amount will be calculated as a percentage portion of the City's share of sales tax revenues generated by Developer. The disbursements will be limited only to the first seven years of operation of the Toyota dealership. The maximum disbursement amount is limited to a percentage of the total sales tax generated, not to exceed One Million Four Hundred Thirty-five Thousand Dollars ($1,435,000). The structure of the agreement conceptually represents a shared performance agreement between the Agency and the developer whereby both parties will proportionately benefit fram the Toyota dealership's level of performance during the first seven years of operation. Conditions of Disbursement In addition to all of the maintenance requirements and operating covenants contained in the OPA, the Agreement further establishes the following conditions of disbursement: 1. Execution and Delivery of Documents. The OPA shall have been recorded against the property in the official records of San Diego County as an encumbrance to the property superior and non-subordinate to any monetary liens, including without limitation construction and/or permanent financing. 2. Insurance. The developer shall have insurance as required. 3. Reaulatory Approvals. Assuming no protests have been lodged against the location and opening of the dealership, the developer shall have obtained any legally required regulatory approval(s) from applicable governmental agency(ies) related to the developer's ownership and operation of the applicable dealership on the property. 4. Manufacturer Approval. The developer shall have received any required appraval(s) from the manufacturer for the operation of the applicable dealership upon the property. 2-3 PAGE 4, ITEM NO.: MEETING DATE: 02/15/05 5. Consent of Owner for Recordina of Aareement aaainst the Properlv. The developer shall obtain the written consent and/or agreement of each dealership and each lender allowing recordation of the OPA against the property in a superior and non-subordinate position to all other monetary liens and use restrictions on the property. 6. Payment of Properlv Taxes. No ad valorem real property taxes or assessments assessed with respect to the property shall be delinquent. 7. No Default. There shall exist no condition, covenant, event or act which would constitute an event of default, or which, upon the giving of notice or the passage of time, or both, would constitute an event of default. 8. Dealership Continuous Operation. The applicable dealership on the property shall be in continuous operation and generating sales tax revenues in compliance with the restrictive covenants of the OPA. 9. Environmental Condition of the Properlv. The developer shall not be in default of the requirements regarding the environmental condition of the property. FISCAL IMPACT The General Fund will loan the Agency an amount not to exceed One Million Four Hundred Thirty-five Thousand Dollars ($1,435,000) over seven (7) years. The amount loaned to the Agency each year is based upon a percentage of the sales tax revenue generated by the Toyota dealership. Quarterly disbursements will be made by the Agency to the developer in accordance with the pre-determined schedule of disbursements (Exhibit "C" of the OPAl. The Agency will repay the General Fund the entire amount of the loan with interest. Sales tax revenues generated by the Toyota dealership during the lifetime of the project are anticipated to far exceed the loan amount, resulting in no net impact to the general fund. J:\COMMDEV\5TAFF.REP\2005\02-1 5-05\T eyete OPA.dec 2-4 RESOLUTION NO. RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA APPROVING AN OWNER PARTICIPATION AGREEMENT WITH SUNROAD CV AUTO, INC. FOR THE OPERATION AND MAINTENANCE OF A CHULA VISTA TOYOTA DEALERSHIP WHEREAS, The Redevelopment Agency of the City of Chula Vista has proactively planned for the development and expansion of the auto park along the Main Street corridor east of the 1-805 Freeway between Brandywine Avenue and Maxwell Road; and WHEREAS, Sunroad CV Auto, Inc. proposes to develop a Toyota dealership on a portion of the property located on the south side of Main Street between Brandywine and Maxwell Road; and WHEREAS, the site for the proposed Toyota dealership is located within the Otay Valley Road Redevelopment Project Area under the jurisdiction and control of the Redevelopment Agency of the City of Chula Vista; and WHEREAS, the site for the proposed Toyota Automobile Dealership is located within the boundaries of the Auto Park East Specific Plan (PCM-02-10) approved by City Council in June 2004; and WHEREAS, in August 2004, the Redevelopment Agency of the City of Chula Vista approved a Master Owner Participation Agreement with Fred Borst, Borst Family Trust, Fask Land, Inc., establishing development standards and performance requirements for the 29 acres of territory within the Auto Park East Specific Plan; and WHEREAS, The Master Owner Participation Agreement sets forth a number of developer obligations of both the existing master developer and future individual developers and dealership owners; and WHEREAS, The Master Owner Participation Agreement and the Owner Participation Agreement with Sun road CV Auto, Inc. will concurrently guide the development, maintenance, and operation of the Toyota dealership as a "first quality, first class" auto dealership; and WHEREAS, the agreement represents the Chula Vista Redevelopment Agency's ongoing efforts to effectively plan for the City's expanding Auto Park NOW, THEREFORE, BE IT RESOLVED by the Redevelopment Agency of the City of Chula Vista that this Redevelopment Agency does hereby approve in the form presented the Owner Participation Agreement between the Redeveiopment Agency of the City of Chula Vista and Sunroad CV Auto, Inc., a copy of which shall be kept on file in the Office of the City Clerk. BE IT FURTHER RESOLVED that the Mayor of the City of Chula Vista is hereby authorized to execute said Owner Participation Agreement with Sunroad CV Auto, Inc. for and on behalf of the Redevelopment Agency of the City of Chula Vista. 2-5 Presented by Laurie A. Madigan Director of Community Development Approved as to form by 4~ ~~ f/uU nn oore City Attorney and Agency Counsel 2-6 Recording Requested By and When Recorded Mail to: CHULA VISTA REDEVELOPMENT AGENCY 276 Fourth Avenue Chula Vista, CA 91910 Attn: Linda Welch (Space Above This Line For Recorder) TIlls document is exempt from the payment of a recording fee pursuant to Government Code Section 6103. APN: 644-040-66 and 644-040-11 OWNER P ARTICIP ATION AGREEMENT This OWNER PARTICIPATION AGREEMENT ("Agreement") is entered into by and between the REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA, a public body corporate and politic ("AGENCY"), and Sunroad CV Auto, Inc. ("DEVELOPER"), dated and effective as of February ~ 2005 ("Effective Date"). WHEREAS, the DEVELOPER desires to develop real property (APN 644-040-66 and 644- 040-11) within the City of Chula Vista, generally located along the southerly side of Main Street, east of Brandywine Avenue and west of Maxwell Road, within the City of Chula Vista, California ("Property"), as further described in the map attached hereto as Exhibit" A." WHEREAS, a Master Owner Participation Agreement ("Master Agreement") was previously executed and entered into on August 24, 2004 by and between AGENCY and Fred Borst, Borst Family Trust, Fask Land, Inc. or permitted assignee ("Master DEVELOPER"), the Master DEVELOPER of Property and other contiguous properties in the Auto Park East Specific Plan, setting forth development standards and performance requirements for the Master DEVELOPER and individual dealerships, including Property; and WHEREAS, DEVELOPER shall comply with all applicable obligations, covenants, and provisions of said Master Agreement, incorporated herein by this reference; and WHEREAS, DEVELOPER has presented AGENCY plans for the development of Property as a Toyota auto dealership ("Project") in accordance with the City of Chula Vista's ("City") adopted Auto Park East Specific Plan ("Initial Entitlements"); and WHEREAS, the Project is located entirely within the MERGED REDEVELOPMENT PROJECf AREA within the jurisdiction of AGENCY; and 2-7 WHEREAS, in consideration of the specific operating covenants and restrictive covenants binding on DEVELOPER and set forth herein, AGENCY has agreed to make certain payments to DEVELOPER; and WHEREAS, AGENCY has determined it is of benefit to AGENCY, the City, and its citizens for the Property to be planned, developed, and operated in accordance with the City's adopted Auto Park East Specific Plan ("Specific Plan"), and that the imposition of certain operating covenants and restrictive covenants upon the Property for the uses set forth in the Specific Plan constitutes a valid public purpose and objective of AGENCY's Redevelopment Plan for the Project area, and therefore AGENCY desires to obtain such operating covenants and restrictive covenants on the Property and, subject to the terms hereof, DEVELOPER (for itself and its successors and assigns of the Property or any part thereof) is willing to enter into and be bound by such operating covenants and restrictive covenants; and WHEREAS, AGENCY and DEVELOPER desire that the Project be developed in accordance with the terms of this Agreement. NOW, THEREFORE, AGENCY and DEVELOPER do hereby agree as follows: 1. DEVELOPMENT OBLIGATION. DEVELOPER covenants and agrees by and for itself, its heirs, executors, administrators and assigns and all persons claiming under or through them the following: A. DEVELOPER shall develop the Property with the Project substantially in accordance with the AGENCY-approved development proposal attached hereto as Exhibit "B." B. DEVELOPER shall obtain all necessary federal, state, and local governmental permits and approvals and abide by all applicable federal, state and local laws, regulations, policies and approvals in connection with the development of the Project. DEVELOPER further agrees that this Agreement is contingent upon DEVELOPER securing said permits and approvals. DEVELOPER shall pay all applicable development impact and processing fees. Subject to applicable laws, AGENCY staff agrees to exercise good faith efforts to expedite the processing and final consideration of all entitlements and permits necessary for the Project. DEVELOPER further agrees that construction shall be completed in compliance with all applicable laws, labor standards, and Department of Industrial Relations rules and regulations. C. DEVELOPER shall apply for all necessary building permits to develop the Project within one year from the date of this Agreement, shall diligently pursue obtaining such building permits and shall actually develop the Property with the Project within one year from the date of issuance of the building permits. In the event DEVELOPER fails to meet these deadlines, AGENCY approval of DEVELOPER's development proposals shall be void and this Agreement shall have no further force or effect. D. DEVELOPER shall comply with all conditions of approval of the Auto Park East Specific Plan (PCM-02-10) and the Design Review Committee (DRC-04-66), and comply with the mitigation monitoring program adopted for Mitigated Negative Declaration 15-02-010. -2- 2-8 II. MAINTENANCE OBLIGATION. A. DUTY TO MAINTAIN FIRST CLASS CONDITION. DEVELOPER covenants to develop and maintain the Property in First Quality, First Gass Condition and Repair consistent with development, maintenance and operation standards customary for first quality, first class auto parks and first class quality automobile dealerships of comparable size within the San Diego California market region and in conformity with the Initial Entitlement, and the covenants, conditions, maintenance obligations and other restrictions therein during the term of this Agreement. Additionally, DEVELOPER shall promptly and diligently repair, restore, alter, add to, remove, and replace, as required, all improvements to maintain or comply as above, or to remedy all damage to or destruction of all or any part of the improvements except improvements dedicated to and accepted by the City. "First Quality, First Class Condition and Repair" means an efficient and attractive condition, at least substantially equal in quality to the condition which exists when the improvements on the Property were completed, ordinary wear and tear excepted, in accordance with all applicable laws and conditions. "Dealership" shall mean any person or business of any nature selling, leasing, or financing vehicles on the property. B. DELEGATION OF REPAIR AUTHORITY. In order to enforce all above maintenance provisions, the parties agree that the Community Development Director of the City of Chula Vista ("Director") is empowered to make reasonable determinations as to whether the Property is in a first class condition and repair. In accordance with the Master Agreement: 1. If the Director determines the Property appears materially different in terms of maintenance and upkeep than the remainder of the Auto Park, the Property is not in conformity with the requirements of this Agreement regarding maintenance and upkeep of the Project, DEVELOPER shall be notified in writing and provided a reasonable time to cure and! or to commence to cure and diligently and continuously complete such cure. 2. If a cure or substantial and ongoing progress to cure has not been made, the Director is authorized to effectuate the cure by City forces or otherwise, the cost of which will promptly be due from and reimbursed by DEVELOPER. 3. The Director or the City shall have the right to enforce this lien by forwarding the amount to be collected to the San Diego Tax Assessor who shall make it part of the tax bill for the Property. III. NON-DISCRIMINATION COVENANTS. DEVELOPER covenants by and for itself and any successors in interest (and each Dealership successor) that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, physical or mental disability or medical condition, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, nor shall DEVELOPER itself or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Property. The foregoing covenants shall run with the land. A. All deeds, leases or contracts with respect to the Property shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: 1. In deeds: "The grantee herein covenants by and for itself, its successors and -3- 2-9 assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of sex, marital status, race, color, creed, religion, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee itself or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land." 2. In leases: "The lessee herein covenants by and for itself, its successors and assigns, and all persons claiming under or through them, and this lease is made and accepted upon and subject to the following conditions: That there shall be no discrimination against or segregation of any petson or group of persons, on account of sex, marital status, race, color, creed, religion, national origin or ancestry in the leasing, subleasing, renting, transferring, use, occupancy, tenure or enjoyment of the land herein leased, nor shall lessee itself, or any person claiming under or through it, establish or permit such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sub lessees, subtenants or vendees in the land herein leased." 3. In contracts: "There shall be no discrimination against or segregation of any person or group of persons on account of sex, marital status, race, color, religion, creed, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land, nor shall the transferee itself or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with Reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees of the land." IV. RESTRICTIVE OPERATING COVENANTS. DEVELOPER hereby covenants and agrees (for itself and any and all successors in interest of the DEVELOPER entity, any and all AGENCY- approved assignees under this Agreement or any part thereof, and any and all successors in interest to the Property or any part, portion, or parcel thereof, including any and all AGENCY-approved transferees of the Property or any part, portion, or parcel thereof) to the following covenants: A. DEVELOPER AND DEALERSHIP'S OPERATIONS. During the operating period, DEVELOPER shall do or cause to be done the following: 1. For as long as operated as a new vehicle Dealership, to designate the Property as the point of sale for sales tax purposes in all retail sales for vehicles whose sales originate from the Property; 2. At no cost to AGENCY or City, keep and maintain the Property and the improvements thereon and all facilities appurtenant thereto, consistent with first class auto parks and first class automobile dealerships, in good order and repair and safe condition, and the whole thereof, the improvements, and landscaping in a clean, sanitary, and orderly condition; and 3. Comply with all governmental requirements but only to the extent a failure to comply materially and adversely affects DEVELOPER's (or any successor's) ability to comply with these covenants; provided, however, that DEVELOPER (nor its successors) do/does not waive its -4- 2-10 right to challenge the validity or applicability of any such governmental requirements. V. CONSIDERATION/PAYMENT FOR ANNUAL COMPLIANCE WITH RESTRICTIVE OPERATING COVENANTS. A. SALES TAX REVENUES AND RELATED DEFINITIONS. As used in this Section, "Sales Tax Revenues" shall mean that portion of taxes derived and received by the City and legally available for unrestricted use by the City's General Fund from the imposition of the Bradley Burns Uniform Local Sales and Use Tax Law, commencing with Section7200 of the Revenue and Taxation Code of the State of California ("State"), as amended, or its equivalent, arising from all businesses and activities conducted on the Property in accordance herewith from time to time, which are subject to such Sales and Use Tax Law. As used in herein "Retained Sales Tax" shall mean 1 % of Sales Tax Revenues reported in the DEVELOPER's quarterly sales and use tax report to the State and verified by the City minus an amount equal to the payment described herein if any, paid to DEVELOPER herein. B. CONSIDERA TrON. In consideration for DEVELOPER's agreement to be bound by the Restrictive Covenants in Section IV of this Agreement, AGENCY agrees, as follows: 1. AGENCY shall pay to DEVELOPER an amount equal to a portion of the City's share of Sales Tax Revenues generated by Developer on a quarterly basis as identified in the attached Exhibit "e" ("Disbursement"). The Disbursement will be based on the sales tax information received from the State Board of Equalization which is available one quarter after the submission of the DEVELOPER's quarterly sales/use tax report. The Disbursement will be distributed each quarter, commencing with the first full quarter after DEVELOPER has commenced operations during the term of the Restrictive Covenants until the earlier of (i) the Seventh (7th) anniversary date of the first payment as identified in Exhibit "C" or (ii) receipt by DEVELOPER of the aggregate amount of One Million Four Hundred Thirty-five Thousand Dollars ($1,435,000) under this subsection. a. The Disbursements due hereunder shall be payable from any source of funds legally available to AGENCY. The determination of the source of funds shall be in the sole and absolute discretion of AGENCY. b. The amount of the Disbursement due on each such payment date shall be determined by the City's sales tax consultants based on information provided by the State Board of Equalization and verified by the City's Finance Department adjusted for any corrections to previous tax reports made by the State Board of Equalization. c. Sales Tax Revenues generated each period shall be determined as follows: (i) For sales of automobiles, parts and accessories, Sales Tax Revenue shall be based upon the State Board of Equalization sales and use tax report(s) applicable to a dealership at the Property during the applicable sales period; and (1) "Sales of Automobiles" shall include all new or used vehicles conveyed to any related or independent third party, including any financing company for purposes of selling, leasing, or financing the vehicle to the end user. (ii) Upon written request by AGENCY, DEVELOPER shall -5- 2-11 promptly furnish to AGENCY any and all said information and take any and all actions which are reasonably deemed necessary by AGENCY to assist AGENCY in verifying the information contained in said sales and use tax returns and reports of new and used vehicles. AGENCY shall be entitled to review and audit the Dealership's books and records pertaining to the foregoing. (1) If an audit of the Dealership's books and records determines that DEVELOPER (or Dealership) has overstated revenues in any applicable period, DEVELOPER shall reimburse AGENCY for any overpayment, and if DEVELOPER has overstated revenues by more than ten percent (10%) in any period, DEVELOPER shall reimburse AGENCY for the cost of the audit, within thirty (30) days of notice thereof from AGENCY. (2) Reciprocally, DEVELOPER (or Dealership), atits sole cost and expense, may request an audit to verify and/ or reconcile the calculation of the amount of any payment. If such audit reveals an underpayment to DEVELOPER (or a Dealership), then AGENCY shall pay the outstanding amount of any payment hereunder to be paid to the DEVELOPER (or Dealership); and if such audit reveals an overpayment to DEVELOPER, then DEVELOPER immediately shall reimburse AGENCY for such overpayment. If AGENCY has underpaid DEVELOPER by more than 10% as a result of an error committed by the AGENCY, AGENCY shall reimburse DEVELOPER for reasonable audit costs, within 30 days of notice thereof from DEVELOPER. (3) If DEVELOPER contests the amount of Sales Tax Revenues for any period for the sales of automobiles, parts, and accessories arising from the dealership, as based upon the State Board of Equalization sales and use tax report applicable to the Dealership and the Property, at the sole expense of DEVELOPER, then AGENCY shall use good faith efforts to investigate and, if appropriate, to take steps to ensure that the correct amount of Sales Tax Revenues arising from the dealership is allocated to the City, and the correct amount of the period's payment is calculated and paid to DEVELOPER. d. If after the fourth (4th) year payments, DEVELOPER has received less than $1.1 million in compensation for compliance with the restrictive covenants contained herein, DEVELOPER may request and AGENCY shall in good faith consider modification to the payment schedule to ensure DEVELOPER receives fair and just compensation for compliance with the restrictive operating covenants being purchased by the AGENCY herein. C. PAYMENTS. Upon DEVELOPER's satisfaction of the Conditions Precedent to Disbursement set forth below, each payment shall occur within 180 days following the end of the quarter ("Payment Date") based with respect to the applicable sales period. DEVELOPER is aware and acknowledges that the determination of the Disbursement amount will be determined and based upon the receipt by the City of the State Board of Equalization report within 90 days of the end of the applicable quarter. If the City fails to receive said report within 90 days of the end of the applicable quarter, Payment Date shall be automatically extended a number of days equal to the number of days delay in the City receipt of said report. DEVELOPER is aware and acknowledges that as of the Effective Date of Agreement, CITY intends that the State Board of Equalization report will be supplemented and summarized by an outside third party fiscal consultant. 1. Each payment will be made within 180 days following the end of the quarter, except as otherwise provided herein, based on the issuance and receipt by the City of the applicable State Board of Equalization report/ disbursement. DEVELOPER acknowledges each State Board of Equalization report is also reviewed by fiscal consultant(s) to AGENCY and City. DEVELOPER acknowledges and agrees that such fiscal consultant(s) will undertake calculation of each payment and, thereafter, the calculation will be reviewed by the City's Finance Department staff. Upon the -6- 2-12 City's receipt of each quarterly report, AGENCY shall notify DEVELOPER in writing of the date of receipt and the anticipated date of delivery of payment to DEVELOPER. AGENCY will use its best efforts to review and process any and all payments due to DEVELOPER in a timely and expeditious manner. D. CONDITIONS PRECEDENT TO DISBURSEMENT. Each payment hereunder is conditioned upon the satisfaction by DEVELOPER of the respective conditions precedent (1) through (9) inclusive, described below. Such conditions ("Conditions Precedent") are solely for the benefit of AGENCY, and shall be fulfilled by DEVELOPER (or waived by AGENCY in its sole and reasonable discretion) within the time periods provided for herein. DEVELOPER may satisfy (and submit evidence of such satisfaction to the Director) one or more of such Conditions Precedent at any time prior to the first payment, so that at the time the first payment is due, DEVELOPER may have already provided satisfactory evidence of compliance with each of such Conditions Precedent. Thereafter, for subsequent payments, DEVELOPER shall have been deemed to have satisfied each of the respective conditions precedent which do not expire or contain a re=ring obligation, unless DEVELOPER fails to timely satisfy condition 7, below, in which case AGENCY may require renewal or update of any prior submittal. 1. Execution and Delivery of Documents. This Agreement shall have been recorded against the Property in the official records of San Diego County as an encumbrance to the Property superior and non-subordinate to any monetary liens, including without limitation construction and/ or permanent financing. 2. Insurance. DEVELOPER shall have insurance, including general liability coverage. 3. Regulatory Approvals. Assuming no protests have been lodged against the location and opening of the Dealership, DEVELOPER shall have obtained any legally required regulatory approval(s) from applicable governmental AGENCY(ies) related to DEVELOPER's ownership and operation of the applicable Dealership on the Property. 4. Manufacturer Approval. DEVELOPER shall have received any required approval(s) from the manufacturer for the operation of the applicable Dealership upon the Property. 5. Consent of Owner for Recording of Agreement against the Prol'ertv. DEVELOPER shall obtain the written consent and/ or agreement of each Dealership and each lender allowing recordation of this Agreement against the Property in a superior and non-subordinate position to all other monetary liens and use restrictions on the Property. 6. Payment of Property Taxes. No ad valorem real property taxes or assessments assessed with respect to the Property shall be delinquent. 7. No Default. There shall exist no condition, covenant, event or act which would constitute an event of default hereunder, or which, upon the giving of notice or the passage of time, or both, would constitute an event of default. 8. Dealership Continuous Operation. The applicable Dealership on the Property shall be in continuous operation and generating Sales Tax Revenues in compliance with the Restrictive Covenants herein. -7- 2-13 9. Envirorunental Condition of the Prof'erty. DEVELOPER shall not be in default of the requirements regarding the envirorunental condition of the Property. D. NO PLEDGE OF TAXES. AGENCY's obligations hereunder are not, shall not constitute, and shall not be construed as a pledge of funds by AGENCY or the City, in particular there is and shall not be a pledge of tax increment pursuant to Health and Safety Code Section 33671, a pledge of City sales tax revenues, a pledge of any other specific revenues of AGENCY, or a pledge of the City's general fund. All references to the Sales Tax Revenue are intended solely to create an index for calculating the amount of the payments, and shall not in any respect whatsoever be construed as a pledge of specific funds of AGENCY nor the City's general fund. Nothing in the foregoing statement that there is and shall be no pledge of specific funds hereunder, shall limit or diminish the AGENCY's obligation to make payments required hereunder to DEVELOPER, assuming all Conditions Precedent to such payment are satisfied. E. CAP ON CONSIDERATION. Notwithstanding anything else herein contained, in no event shall the total consideration paid to DEVELOPER pursuant to this Section V exceed the sum of One Million Four Hundred Thirty-Five Thousand Dollars ($1,435,000). F. NO ACCELERATION. It is acknowledged by the parties that any payments by AGENCY provided for herein may only be paid in those periods in which DEVELOPER is in compliance with the Restrictive Covenants provided for herein. Upon AGENCY satisfaction that DEVELOPER has come into compliance with the restrictive operating covenants contained within Section V, AGENCY shall make any previously withheld payments due pursuant to Section V. Therefore, the failure of AGENCY to make any payments during the contribution term provided above shall not cause the acceleration of any future payments by AGENCY to DEVELOPER beyond the date of such default. VI. SIGNAGE A. SIGN. Upon execution of this Agreement, AGENCY shall diligently pursue the construction of an auto park directional sign along Auto Park Drive in the vicinity of the eastern boundary of Interstate 805 ("Sign"). The Sign will be professionally designed utilizing auto park industry standards. At this time, such standards may include a permanent display with space for a listing of each make of auto dealership that constructs an auto dealership within the Auto Park, including but not limited to Toyota and Scion, and an electronic reader board. The Sign will be designed by the AGENCY in consultation with the Association or with Master Developer and existing dealers if the Association has not yet been formed. B. AGENCY recognizes that the DEVELOPER believes it is critical that the Sign be erected before the date upon which DEVELOPER opens the Project to the public. As a result of that acknowledgment AGENCY will use its best efforts to timely identify a location for and design of the Sign. Additionally, AGENCY will in good faith use all reasonable means necessary to procure the appropriate interest in land. C. Concurrently with site identification AGENCY will diligently pursue design and construction consultants to erect said Sign. To that end, Agency has identified the following target dates for the sign: - 8- 2-14 DATE ACTlDN February, 2005 City hires consultant to recommend potential location and design of the Auto Park Directional sign April, 2005 Proposed design of Auto Park Directional sign complete and potential sites identified May, 2005 Auto Dealers Association/ City staff select design and proposed location June, 2005 DRC and City Council Review and Approval of Design and location July, 2005 Begin acquisition process September, Acquisition of site 2005 October, 2005 Beqin construction D. DEVELOPER acknowledges and agrees that this Agreement does not bind the AGENCY to enter into any agreement or to take any particular action related to said Sign and that the AGENCY's failure to enter an agreement with a consultant to pursue installation or construction of said Sign shall not constitute a breach of this Agreement. In this regard, the AGENCY undertakes no obligation to DEVELOPER hereunder and retains its sole and unfettered discretion to adopt any resolutions and does not prejudge or commit, in any respect whatsoever, to the DEVELOPER, or any other person or entity, regarding said Sign. DEVELOPER understands that the AGENCY and City expressly and intentionally reserve the right to exercise their discretion as to all matters which they are, by law, entitled or required to exercise their discEtion. E. DEVELOPER retains its discretion to apply for and pursue construction of the above identified sign. If after consultation with the AGENCY, DEVELOPER and AGENCY reasonably determine AGENCY is unable or unwilling to erect said sign and DEVELOPER pursues private construction of said sign, DEVELOPER may request and AGENCY shall in good faith consider providing appropriate assistance to DEVELOPER. DEVELOPER acknowledges and agrees that any assistance provided to DEVELOPER shall not exceed $1.2 million for the sign. If the AGENCY determines assistance is appropriate, at least 30 days prior to DEVELOPER expending funds for the erection of the sign, DEVELOPER and AGENCY shall meet to determine the amount and form of said assistance and to devise a mutually acceptable payment schedule. F. If the DEVELOPER chooses to pursue the erection of the sign, the AGENCY acknowledges that DEVELOPER may request additional funds associated with land acquisition and financing of the sign. DEVELOPER acknowledges AGENCY has made no commitment as it relates to acquisition or financing costs but will in good faith consider said request. VII. MISCELLANEOUS. A. AGENCY and DEVELOPER agree that the covenants of the DEVELOPER expressed herein shall run with the land for the duration of the term of the MERGED REDEVELOPMENT PROJECT AREA, as it may be amended from time to time. B. DEVELOPER and AGENCY agree to mutually consider reasonable requests for amendments to this Agreement which may be made by lending institutions, AGENCY's counsel, or DEVELOPER's counsel provided such requests are consistent with this Agreement and would not -9- 2-15 substantially alter the basic business terms included herein. The Director shall have the authority to issue interpretations, waive provisions and enter into amendments of this Agreement on behalf of the AGENCY so long as such actions do not substantially change the uses permitted for the Project or the terms and provisions specified herein and as agreed to by the Agency Board. All other waivers or amendments shall require the consideration and written consent of the AGENCY Board. C. It is understood the schedule and outside dates for performance under this Agreement are subject to all of the terms and conditions set forth in the text of this Agreement. AGENCY vests in the Executive Director the sole and complete discretion to authorize extensions to the outside dates set forth herein for (i) application for all necessary permits to develop the Project, and (ii) development of the Project; provided however, that in no event shall any extension of any outside date referenced in (i) and/or (ii) of this subsection, or all extensions taken together, exceed eighteen (18) months. Additionally, each and every extension is also subject to the following provisions. (i) Each extension shall be mutually agreed upon in writing between DEVELOPER (or a successor) and the Executive Director based on extensions necessary due to changes in circumstances, market conditions relating to operation of first class, first quality automobile dealerships and franchises in Chula Vista, California, or other factors not known by the parties as of the date of this Agreement. (ii) Each request for an extension from DEVELOPER (or a successor) of an outside date shall be in writing stating the requested extension period, the reasons for such extension, the facts and circumstances related to the need for such extension, and other information reasonably necessary for the Executive Director to understand the basis for such request and the circumstances that did not exist as of the date of this Agreement that necessitate such requested extension. The Executive Director is authorized to agree to make such revisions as he/she deems reasonably necessary based on changes in circumstances or other factors not known as of the date of this Agreement. In the event an extension is granted by the Executive Director, then the performance tasks hereunder shall be extended by such period and any corresponding extension necessary to correlate the times for performance hereunder are also reasonably extended to correlate with the approved extension, as determined by the Executive Director in his/her sole and absolute discretion. D. AGENCY and DEVELOPER agree that the covenants of the DEVELOPER expressed herein are for the express benefit of the AGENCY and for all owners of real property within the boundaries of the MERGED REDEVELOPMENT PROJECT AREA as the same now exists or may be hereafter amended. AGENCY and DEVELOPER agree that the provisions of this Agreement may be specifically enforced in any court of competent jurisdiction by the AGENCY on its own behalf or on behalf of any owner of real property within the boundaries of the MERGED REDEVELOPMENT PROJECT AREA. "Notwithstanding the foregoing or anything else in this Agreement, nothing in this Agreement shall be construed to accord any party not a party to this Agreement third-party beneficiary status under this Agreement, and nothing in this Agreement shall be construed to accord any party not a party to this Agreement any right to enforce any provision of this Agreement." E. AGENCY and DEVELOPER agree that this Agreement may be recorded by AGENCY in the Office of the County Recorder of San Diego County, California. F. DEVELOPER shall and does hereby agree to indemnify, protect, defend and hold -10- 2-16 harmless AGENCY and the City, and their respective Council members, officers, employees, agents and representatives (collectively, the "Indemnified Parties"), from and against any and all liabilities, losses, damages, demands, claims and costs, including court costs incurred as result of any administrative or regulatory action, and reasonable attorneys' fees (collectively, "liabilities") arising, directly or indirectly, from (a) AGENCY'S approval of this Agreement, (b) AGENCY's or City's approval or issuance of any other permit or action, whether discretionary or non-discretionary, in connection with the Project contemplated herein, and (c) DEVELOPER's construction and operation of the Project permitted hereby. G. In the event that any court action or other legal proceeding is brought by any person not a party to this Agreement to challenge this Agreement, the granting of any entitlements, the purchasing of the operating covenant or the fulfillment of any condition to the obligations of the parties hereto, and without regard to whether or not the DEVELOPER or the AGENCY is a party to said action or proceeding, DEVELOPER and AGENCY shall meet and confer to discuss how to respond to such challenge. If the parties agree to defend against such challenge, or defense costs are otherwise reasonably in=red by AGENCY or the City prior to such determination, DEVELOPER shall indemnify the AGENCY and the City for all expenses, including attorneys' fees, to defend the City or the AGENCY from any claim, action or proceeding against the City, the AGENCY or their agents officers, or employees to attack, set aside, void or annul the approval of this Agreement or the approval of any entitlements or the purchasing of the operating covenants or condition to the obligations of the parties hereto. AGENCY and the City shall promptly notify DEVELOPER of any such claim, action or proceeding. For purposes of this Section, DEVELOPER acknowledges that the term" attorneys' fees" includes the reasonable costs incurred by the City or AGENCY in the defense of any claim, action or proceeding by the City Attorney or her staff. H. In the event of any dispute between the parties with respect to the obligations under this Agreement that results in litigation, the prevailing party shall be entitled to recover its reasonable attorney's fees and court costs from the non-prevailing party. 1. Time is of the essence for each and every obligation hereunder. J. If DEVELOPER fails to fulfill its obligations hereunder after due notice and reasonable opportunity to cure, DEVELOPER shall be in default hereunder, and in addition to any and all other rights and remedies AGENCY may have, at law or in equity, AGENCY shall have the right to terminate its approval of the Project and this Agreement. K. If a party to this Agreement fails to timely satisfy a material obligation under this Agreement as the time for performance may have been extended in its sole discretion pursuant to Section VII.C and/or Section VII.J of this Agreement (such party, a "Defaulting Party", and such failure to timely perform, an "Event of Default"), then the other party to this Agreement (the "Non- Defaulting Party") may provide the Defaulting Party written notice of such Event of Default (a "Default Notice"). Upon the Defaulting Party's receipt of a Default Notice, the Defaulting Party shall have ninety (90) days within which to cure the Event of Default, or if such Event of Default is of a nature that it cannot be cured within such 90-day period, then to begin to effect such cure and diligently pursue completion of performance in the shortest, commercially reasonable time period (the "Cure Period"). Except as otherwise provided within this Agreement, neither party to this Agreement may proceed against a Defaulting Party, nor cease to itself timely perform each and every obligation due under this Agreement, unless and until a Defaulting Party has failed to cure the Event of Default within the applicable Cure Period. If the Defaulting Party fails to cure the Event of -11- 2-17 Default within the applicable Cure Period, then in addition to any and all other rights and remedies the Non-Defaulting Party may have, at law or in equity, the Non-Defaulting Party may terminate this Agreement. 1. The qualifications and identities of the individuals comprising the DEVELOPER entities are of particular concern to the AGENCY. It is because of those qualifications and identities that the AGENCY has entered into this Agreement with the DEVELOPER. No voluntary or involuntary successor in interest of the DEVELOPER shall acquire any rights or powers under this Agreement except as expressly set forth herein. (i) DEVELOPER shall not, except as permitted by this Agreement, assign or attempt to assign this Agreement or any right herein with respect to the Proj ect, nor make any total or partial sale, transfer, conveyance or assignment ofthe whole or any part of the Property Site or the improvements thereon, without prior written approval of the AGENCY in its sole discretion. Any attempted transfer that has not been so approved by AGENCY shall be void. Except as permitted below, transfers of any interest in the DEVELOPER entity shall constitute a prohibited transfer hereunder. (ii) Notwithstanding any other provisions ofthis Agreement to the contrary, AGENCY approval ofan assignment of this Agreement or any interest herein shall not be required in connection with any of the following: (a) Any transfers among the principals of the DEVELOPER entities so long as the existing principals thereof shall be and remain in management control of the DEVELOPER entity with at least a fifty-one percent (51 %) ownership or beneficial interest in the DEVELOPER entity. (b) The granting of temporary or permanent easements or permits to governmental or quasi-governmental agencies to facilitate the development of the Property, or any component thereof. (iii) AGENCY consent will be granted if: (a) the proposed assignee/transferee expressly assumes, in writing, Master DEVELOPER's obligations hereunder as to times following the effective date of the assignment or transfer; (b) the proposed assignee/transferee has demonstrated to the reasonable satisfaction of AGENCY that such person or entity has adequate financial capacity to fulfill all obligations ofthis Agreement. (M) Notwithstanding the foregoing or anything else in this Agreement, all dates for performance set forth in this Agreement are subject to a one (1) day extension for each day of delay in performance due to a Force Majeure Event, provided that the party claiming the right to such extension provides the other party written notice of the Force Majeure Event within thirty (30) days following the occurrence of such event. As used in this Agreement, "Force Majeure Event" means any act of God, act or omission of any local, state, or federal governmental AGENCY (including, without limitation, the AGENCY and the City, and including without limitation, the failure or refusal -12- 2-18 of any such AGENCY to grant, issue or enact any entitlement, approval, or permit necessary for the use, development or disposition of the Property or any portion of the Property), casualty, stormy or inclement weather, epidemic, war, terrorism, insurrection, riot, fire, flood, earthquake, strike, boycott or other labor dispute, delay in transportation, unavailability or scarcity of!abar or materials and any legislative, administrative or judicially imposed restriction upon or prohibition against construction or development. Signature Page Follows -13- 2-19 DZ-DB-ZDD5 D7: 16PU ,ROU-SUNROAD ENTERPR I SES +85816Z844B T-ll1 P.OI5/DI8 ,-IBB Signature Page IN WITNESS WHEREOF THE PARTIES HAVE ENTERED INTO THIS AGREEMENT EFFECTNE AS OF THE DATE Fill.ST WRITTEN ABOVE. "AGENCY" REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA. a public body corporate and politic DATED: By: Stephen C. Padilla, Chairman APPROVED AS TO FORM BY: Ann Moore AGENCY Attorney "DEVELOPER" DATED: hG q 2 p~ 5 / S~~lif=;'C"""'ti~ By: Its: (./~; Fe.fJ-<l V I' NOTARY: Please attach aclcnowledgment card(s). J:IAII?meylEHull\AgreementsIToyora OPA 020205 CLEAN.doc 2-20 EXHIBIT A tljj LOCATOR MAP ~ i'! " ~ ~ c f . ~ [J ~ ~ 31 i Desl if ~~ MainSt CJ AUTO PARK PROJECT ~ lOCATION ---- --~- - fSD C HULA VISTA PLANNING AND BUILDING DEPARTMENT LOCATOR PROJECT PROJECT DESCRIPTION: C) APPLICANT: Chula Vista Toyota DESIGN REVIEW PROJECT Auto Park East ADDRESS: Request: Proposal for new auto dealership and carwash. SCALE: . FILE NUMBER: NORTH No Scale DRC-04-66 '>1 J:\planning\carIOS\locators\drc0466.cdr 07.12.04 EXHIBIT B REDUCED COPIES OF DESIGN PLANS FRONT ELEY ATION . ~~~~~...~.:....~~= CHULA VISTA ~ TOYOTA 2-22 ) f\ ~ ~: -' MAIN STREET -__ _ ,i>~::<;j/~ _.~ ..-:~-;:..::..;;:...:-..-~--~ :~~~~~"-~~:',c ~_M 1~'"";,;-~--~.- s-.:;; ;- ----- ~. "r'_.......-.:-..' .." ....;.""'T'.- -~,~.....:" l'I::;"'-"-'~"""'''''''r ....-;;r-;- ;" ~":W'.JJ!,: ,I~- ~ I j lMi.~"0 ..Cm:J1 -- 11~ ,+-l~':~----i,.- ,r:)t>< ~i: : i.. I I ',~,!: ,l-'~"~ ~ +';i>f]~'; : ~:~ llJ [~1 f' '....< F "'r~r}t'~rT.""~" L~~j'-'i rt "T,n~_ .:lt~Jr""n.n~r:'TrU ~-t - ~ >r;t:+ ... :t::.:~~. fi ',t:~;;;,,::~~: "~':'il .! L }r;,:;;'9;::l!{:,ir ?"i I' ]"f'J \~ ~ HI ~1~~i~~I~IIIiJ ~~-~,~,~:,,:~ I I H-t+.;v ! 'r~ ~ ';,' 'j I .ii'nM "'" /..""" '~~'rm -::r.- II 'tt,!f.-r(?p . -''''''f;=.l~:!~- ~..!~ ", I i ~:j_f;jJ." - --- ~ - ;f.~ 1" ..... t. t::-~ r ,--diP~'" fi ~( -....- ...._-_...~ E~~ '"l.:'~ -- -.---- ....--... ..... -- -~~.- ___ _oL__ --- =.-::.:.--- , ..,""'-, I @ -w.>.............. - - r--- I......"") -.....- -._-- ....------ -------------....... ~.,~- 2-23 -i ~ VICINITY MAP o o o i II ! g' ~I ~! ,. o. ~i 'I Iii! . ~< >0 I :IS 3!'" , , 0 i @l ~;;;.=; ~!::!~.:- Sp.., ------------~ ~ ~ ~ MAIN STREET ,~~~~*c-Tr~;:-~-~~~-:.~~-~~-;~-~--~-; -- - iT -..:::tf;-"";;-:"-kcr----- - -- 'f.. ..--.----."". .~..,..-..""...-'..I-tQj'l"'-. I' '; "'-""1'1 '"'' ': ,i t"'f'""iii'i:: " >1 , ;,'j f r~~ (:.;. i r-! ~j~ (:' "~,r ( ~" ,- ~t , ~c - k :!'l ( I ~ -- 'W.~::-:-:-W ;~ -.- / 1 ~ ...4;Y" /_--~~- ,---------~ ~ ';....'" _ , ...,:....C"~ ./ '" ~'""...'::'~~?~ ! ,::,,11" --~-~---~'.T"i.-T'ir-T+~ :,. " ,i: :il' I. C)- i"'~ i+ll-Hoo: I. '9 " ili!! l.l i d: il ;, _h_1 ...' ___ ,F tt'"-t . . ~~RA.....~~~~~ -~=Htt--H-L,_+j \:+4;iiii ;. '~1:;.ELjJl-t-!--F' ';' i . , ~ ; ; i 'It t L~ ;_~-+-f' ! i \:Ill:. !::::i ~!"'~i~i roo' ~! , ;i\,';"'!!.44"" ., ~ ".~:(,;._+-.i---i---'- QlJ, - ",-,-,-, L."'.L".' ...-- ld ~---'--~-- ,- - rl r---,--f c:: r-' :q TOYOTA , , , , L_________________________J ~4~fMHII.ljH ~~;~,.~"...~-~--~~-J;~ , ,. ,-r-t"i! i i ~ x," " "iii<" "" //,', """Q-" -; , II ill'!' ! ! 'ill" \ I \ ~-~~~~~..' 2-24 \ \ \ ; \ ~ 'i - IS . 0 ~ '* * ~ EJ ~ ~ IIIiIl II 0 ii Ii Ii!:! PLANT LEGEND -- -- - -- I:I:-.~._- =--~-=-- =-- -- -- _.....1'16_ ,~-.-.:-- --- .......,,~ -_.~.."-~.._~- .......-- -......- @ CHULA VISTA @ TOYOTA ,~n_\ (.;-n, 4". . -'''-m"""'' H+.;..,.....-l---' OJ.' ., -. '" .. . ". ~,,--' , ~......._..." ._=':""'-~ ","'.='.....;;;;.;;;..;;;.. ! -...--- , ~ ~~~~~~~:~! ~;n_' . , -~.._, -"'~-: ",_:0' , ,.;--. ~_.': ~IilUOVAT1ON " .....T.....-v...TIOtt 2-25 ., ; ,~ 4~l" o o o I el ! r .1 ~! ~i ~! III! . i!! "i!! >01 :5> ~gi " i @i . z o ~ ~ ~ri- ., a: .-- l!!~--!!!!; ~<:.~ ....2 .T1..... "1Iml' ;;';:.: @ '. ~i+=;z:_:~ --~~n~ ~I 1-... ,.. ~" . ' "........, -, . ~;' I .:::11: . I i- ,--'WEn ELEYAnoN -I" 2-26 ~ ,ji~~ "::::;.;;;;1 r1'~,,,,,!:~-~;;1 L: "" o o o I ~! I d i! ~l III! . '" !~ >01 :IS =>,..\ G i ~ 6:\ I ~t:tJ > i~= l:i-::'~ -"-2.1 (I I "":t';::::.:l -, Iji~\ - 1_,. 'r' , c::r'~~' ;:::tl..:-...:c=::::J --::-."" '- ~,' , ~>"...".-l, ~,h~/ --~, ~ l 'ti';:C-ti)-';"til' ''''''I + ';:;'! ~,.::":-d_;';-d /i "._I'.'-~----o-=~:~--rr-~--~~" ii" I r'....n,J (l!I'-"'-I:;r~""""""'''''''-'~'--L tJ, , I ' ,j -, L \, I~':, 'Vb, ;.:;:~ \, 4"'~' r" I' W-------rr+--i7-, ',,~ '--.--.-,{!' " :~K ' %>-n__~,'_::_,~ It, .": :~j,.l" 5i~">1;(1 >"; ~ ,~, ~ - .. - :,] ~~:,)>I 0~~t'f~~ ,}" ~'>I .~.~" _~~ "-~I ~;~~.- .d I ,,~J ~j"'-....",.[I , .~i , ; ~/! l:1 ~_J~_=--j~:_~ J : I I I : L---~-------------------~-------------------~--J *''OJ-''" 2-27 1 !i l"""".'''-, I ' r ~'I c_ :: f' :--d.--v la.-p 61 'I .- t~ o o o II r -u @ 11 _.0__ I , -- '0" , -.-.--- --- -- - -- "'" , q I I' ~I (1 'I l. - i el <. ! " ~l ~I ~! Ill! . ~ s:g :s>-I ~~I " I @l z S . . o 9 . ~~.."._."" III -._.___ ~ -.= ~~, 8 - -- .., ) n \ " MAIN STREET PLANT L' G END . i . -- * ---- . ---- ~ . =--~._- ~ ~ . !i:!:!-:!!'==- i l1li "'"- i . """"'-=- -- ,~'II!t1:...-.:-_ _"""Nnce. --- ..--.- ~'-=-~~-.............,....... @ . ~~~~~~..:....~~~ CHULA VISTA @ TOYOTA ......-...- 2-28 EXHIBIT C SCHEDULE OF DISBURSEMENTS Year of Disbursement Amount ODeration 1 50% 2 50% 3 50% 4 50% 5 25% 6 25% 7 25% -17 - 2-29