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HomeMy WebLinkAboutcc min 1993/09/07 RDA MINUTES OF A SPECIAL JOINT MEETING OF THE REDEVELOPMENT AGENCY/ CITY COUNCIL OF THE CITY OF CHULA VISTA Tuesday, September 7, 1993 Council Chambers 7:49 p.m. Public Services Building CALL TO ORDER 1. ROLL CALL: PRESENT: Agency/Council Members Horton, Fox, Moore, Rindone, and Chairman/Mayor Nader ALSO PRESENT: John D. Goss, Executive Director/City Manager; Assistant City Manager Sid Morris; Bruce M. Boogaard, Agency General Counsel/City Attorney; and Berlin D. Bosworth, Secretary to the Redevelopment Agency 2. APPROVAL OF MINUTES: August 3, 1993 MSUC (Fox/Moore) to approve minutes of August 3, 1993 as presented. CONSENT CALENDAR (Items pulled: 3] BALANCE OF THE CONSENT CALENDAR OFFERED BY CHAIRMAN/MAYOR NADER. reading of the text was waived, passed and approved unanimously. 3. WRrITEN COMMUNICATIONS: a. Request for consideration for development next to KOA Kampground site - Gregory Cox -- RECOMMENDATION: Refer this item to staff to conduct an investigation and analysis of the proposal and return to the Agency with a report and recommendation. Greg Cox, 3130 Bonita Road, Suite 200, Chula Vista, CA 91910 noted the project was proposed to be built on the approximate 14-acre Lower 5weetwater Valley site which was owned by the City of Chula Vista. He proposed a public/private partnership of the City of Chula Vista/Pacific Malibu Development Corporation/Waruer Properties to build a commercial recreation center which would include a Family Fun Center as well as a Chula Vista Family Recreation Center. Mr. Ken Beck, Pacific Malibu Development Corp., 116 Tigertail Road, Brentwood, CA, presented the proposed major recreation center development in detail. The Chula Vista Family Recreation Center component included three regulation lighted/fenced softba~l fields, scoreboards, comm on concession fadlity, drinking fountains, restrooms, public areas, and bleachered seating as well as a regulation lighted/fenced equipped soccer field. The Family Fan Center component included two lighted miniature golf courses around water, a giant water slide area, a water bumper boats fadlity, a go-cart raceway fadlity, a batting cage fadlity, a kiddie land area, a covered/enclosed arcade/food and video/computer learning center facility, as well as restroom and changing fadlities. There would be shared lighted parking for 280 vehicles. Under the proposed agreement eight acres of the fourteen acres would be leased to PMBC/Waruer on an annual basis of $1, the remaining 6 acres would be conveyed to PMBC/Warner on a Fee Simple basis at inception for an contractually agreed contract to complete the recreational amenities of the Family Recreation Center; the City would need to help acquire an additional 8 acres of the McEliott property contiguous to the City's acres; the Chula Vista Parks and Recreation Department would contribute $750,000 and PMBC/Warner Minutes September 7, 1993 Page 2 would contribute up to an additional $450,000. The City was asked to fund and provide an access road and waive the traffic and signal fees as well as any other development or other fees associated with the project. The City was asked to allow PMBC/Warner to operate the recreational center under contract with the City for a period of fifteen years and award to PMBC, in perpetuity, the concession stands. At the end of the fifteen year period the City would agree to operate the Center. He asked that the proposed project be reviewed and evaluated by staff. The complete proposal, as presented, would be on file in the Office of the Secretary to the Redevelopment Agency. Mr. Cox noted the proposed site for the project under discussion was under consideration by the City for a Veterans Home. He suggested the City look at an alternative site, the 30 acre site owned by the Sweetwater Union High School District immediately contiguous to Chula Vista Community Hospital, for the Veterans Home. Agency/Council Member Fox thought the concept was bold and innovative. He asked the number of days or hours the City would be allowed the use of the facilities. Mr. Cox rephed the City would have complete control and use of the lighted ballfield facilities three days per week with three days per week on a pay-for-play type basis and the seventh day would be used for maintenance. The Family Ftm Center would basically be a commercial operation which would be held in fee title hy the partnership; however, in the computer center there would be flee public programs designed for training purposes. Other components of the facility would be made available to organized groups in the City for free usage to do various type promotional activities, e.g., miniature golf, etc. There could be a program where students who do well in school would be rewarded with flee play. Bill Ayers, Board of Supervisors County Veterans Advisory Council, 44 East Mankato Street, Chula Vista, CA, representing the leading veterans organizations in the City and the County of San Diego, pointed out the State's Veterans Home Commission was building a home in Brawley, the next home was scheduled to be built in Lancaster, and the one after that would be in Chula Vista. The Commission's report would be issued shortly. He felt changing the location now, after commitment had been made, might jeopardize location of the home in Chula Vista. Chairman/Mayor Nader noted the proposed project was an exciting concept but Council had made a commitment to the veterans community. He stated that should a better property be made available and presenting the alternative site to the Veterans Commission not damage Chula Vista's chance for a veterans home it should be explored. He pointed to several additional issues that would need to be analyzed by staff: [1] neighborhood concerns, and [2] legal issues relative to reimbursing the Low- and Moderate-lncome Housing Fund for cost of acquisition of the City-owned parcel. MS (Nader/Fox) to approve staff recommendation. AMENDMENT TO MOTION: (Moore) Authorize staff to contact the State Veterans Commission and their reporting authority and ask for a firm commiunent from them to build the Veteran's Home in (lula VLsta and begin consmiction w~thln thee years. AMENDMENT TO MOTION: (Horton) Inform the Commission and State Administration that (~mla V'Lsta has an alternative site and staff would be putting together a presentation on the alternative site. Director/City Manager Goss pointed out staff would also look at other issues such as land use, proposed project business deal, and pohcy of money for access road. VOTE ON MOTION AS AMENDED: Airproved unanimous]y. Minutes September 7, 1993 Page 3 4. RESOLUTION 1347 ADOPTING NEGATIVE DE(/ARATIONIS-93-41,APPROVINGPIANS, AND ENTERING INTO AN OWNER PARTICIPATION AGREEN[ENT X&qTH DR. LUIS SAN(~IEZ FOR THE CONSTRUCTION OF A MEDICAL OFFICE BUILDING AT 227 CHURCH AVENUE--Dr. S~nchez proposed to construct a single-story medical office building located within the Town Centre I Redevelopmerit Project Area. The Design Review Committee reviewed the project and recommended approval with conditions; the Town Centre Project Area Committee received the proposal as an information item. The Environmental Review Coordinator reviewed the proposal and determined the project will have no significant environmental effect. Staff recommends approval of the resolution. (Community Development Director) Agency/Council Member Rindone asked if the plan, as submitted relative to parking, would create a problem for single-family residences in the neighborhood. Miguel Tapia, Community Development Specialist, noted there were three parking lots across the street-- within 200 to 300 feet of the proposed project--which contained approximately 150 parking spaces. A survey conducted within the last two years showed the parking lots were being used to only 50 percent of their capacity. Agency/Council Member Rindone requested staff to include a statement such as the explanation just given in future staff reports of a similar nature. * * END OF CONSENT CALENDAR * * PUBLIC HEARINGS None submitted. ORAL COMMUNICATIONS None. ACT[ON ITEMS 5.A. RESOLtrrlON 1348 RE-CERTHTYING ENVIRONMENTAL IlViPACT REPORT 91-01 FOR THE DEVELOPMENT OF THE CHULA VISTA AUTO CENTER AND APPROVING PLANS FOR THE DEVELOPMENT OF AN AUTO DEAl .ERSHIP AT 540 AND S60 AUTO PARK DRIVE (FUI J .I~R FORD/HONDA)--The Chula Vista Auto Center Master Plan calls for plans for the new dealerships to be approved by the Redevelopment Agency subsequent to Design Review Committee review and recommendation. The plans for the proposed new South Bay Chevrolet and Fuller Ford/Honda dealerships have been reviewed and conditionally recommended for approval by the DRC and are now being submitted to the Agency for final approval. Staff recommends approval of the resolutions. (Community Development Director) B. RESOLUTION 1349 RE-CER'I'II'fiNG ENVIRONMENTAL IMPACT REPORT 91-01 FOR THE DEVELOPMENT OF THE CHULA VISTA AUTO CENTER AND APPROVING PLANS POR THE DEVELOPMENT OF AN AUTO DEALERSHIP AT 580 AUTO PARK DRIVE (SOUTH BAY CHEVROLET) Fred Kassman, Redevelopment Coordinator, pointed out the Agency was being requested to approve the plans for the Fuller Ford/Honda and South Bay Chevrolet auto dealerships in the new Auto Center. The Minutes September 7, 1993 Page 4 Master Plan called for formal approval by the Agency of the Plans. Chairman/Mayor Nader asked what the Resource Conservation Commission's recommendation on the Environmental Impact Report had been. Mr. Kassman stated they had recommended approval of the EIR about a year prior. He noted there was an issue regarding trees which could be resolved at staff level as well as an issue concerning the height of a masonry wall at the south end of the site. The Design Review Committee recommended no more than a six-foot high wall be installed, the auto developers wanted to install an eight-foot high wall. Chairman/Mayor Nader inquired about the tree issue being resolved at the staff level. Mr. Kassman replied that in discussions between staff and the auto developers the solution of clustering trees would not provide a visibility problem to the auto dealerships and would seem to resolve the issue of planting trees on Auto Park Drive. Agency/Council Member Rindone noted the report stated no on-street parking would be permitted and asked that be addressed in the presentation. Jim Salter, CM&D, Inc., (Constn~ction Management and Development, Inc.), 5473 Kearny Villa Road Suite 300B, San Diego, CA 92123, presented a brief report on the architectural features of the building and the site plan. He pointed out the concern about the trees was only along Auto Center Drive in the interior of the project; they were not asking for a reduction in the number of trees, but rather that the trees be clustered so they would not block the view of the vehicles on the pads. He stated the desired eight-foot fence was to be at the south end of the property--the back of the property, facing the river bed, and was desired for security purposes. In response to Agency/Council Member Rindone's question, all parking--both for employees and customers--was on-site for several reasons, those being esthetics (cleanliness and neatness) and view corridors to the pads and buildings. Designated parking areas had been incorporated into the plans, next to each showroom, to more than accommodate parking requirements. Agency/Council Member Fox asked if staff objected to raising the wall to eight feet. Steve Griffin, Senior Planner, responded staff would support raising the wall to eight feet. Chairman/Mayor Nader wanted to know why the applicant asked for the wall to be eight feet at such a late date. Mr. Salter replied the applicant had a pre-approved policy plan which stated the fence could be up to eight feet. Agency/Council Member Moore stated one of the first buildings built in the area was Hi-Span and less than one year after the building was erected they had serious security problems. Had the applicant not asked for an eight-foot wall he would have recommended they build it that high; they might possibly need a higher Chairman/Mayor Nader stated there was a consensus that the resolution would be nmended to reflect the wall could be built up to eight feet. RESOLUTION 1348 AND RESOLUTION 1349 OFFERED AS AMENDED BY CI~klRMAN/MAYOR NADER, reading of the text was waived, passed and approved unanimously, Minutes September 7, 1993 Page S 6.A REPORT STATUS OF MIDBAYFRONT NEGOTIATIONS--On August 3, 1993 staff presented the status of the Midbayfront negotiations to the Agency and discussed the two major issues for which concurrence with the developer had not been reached. The Agency directed staff to continue negotiations with redefined parameters. Staff continued these negotiations Mr. William Barkerr, landowner and developer, and his representatives have reached agreement on the remaining issues which are now being presented to the Agency for consideration. Staff recommends the Agency accept the report and approve the terms and conditions of financial participation by the City/Agency for inclusion within the Development Agreement. (Community Development Director) B. RESOLUTION 1350 AUTHORIZING THE PREPARATION OF AN AMENDMENT TO THE BAYFRONT RED EVELOPMENT PLAN AND APPROPRIATING FUNDS THEREFOR -- A Redevelopment Plan Amendment is required to incorporate recently approved Local Coast Plan, increase debt limitation, and extend the termination date of the Bayfront Project. An appropriation of funds is requested to pay for consulting services to complete this activity. (4/Sths Vote Required) Mr. Salomone presented a brief report. Agency/Council Member Horton stated she had a problem with asking the developer to donate the land for the Cultural Arts Center and to also provide major funding for the Cultural Arts Center; however, that was Council's direction. She was concerned with having fund raising efforts for the Nature Interpretire Center and/or the Cultural Arts Center to offset or rebate Mr. Barkett's obligation to fund them. Mr. Salomone pointed out that in the original proposal the City would receive $1 million up-front money from the developer to use; however, the Cultural Arts Commission chose to hire a fundraiser to begin fund raising efforts. Five years after Phase 1 of the project was completed, the developer would give the balance of$10million to the City ifit had not been raised. PerCouncil's/Agency's direction, the proposal provided for $2.5 million in cash "seed money" within the first six to eight years: $1,000,000 immediately, $S00,000 on issuance of first Grading Permit, $500,000 on issuance of the first Building Permit, $500,000 four years later and, five years after Phase 1 of the project was completed, the developer would give the City the balance up to $7.5 million. Agency/Council Member Horton stated fund raising efforts would probably not succeed if a donor thought his contribution would be used to offset the developer's obligation. She noted that staff indicated the first $S00,000 annual payment for funding the Nature lnterpretive Center would occur early in the development process and desired to know if staff had a more certain timeframe for that. Mr. Salomone replied that it would be subject to further negotiation and would be part of the Development Agreement. Agency/Council Member Horton asked what would be rettu~ed to the California Coastal Commission. Mr. Salomone stated the Development Agreement would need to be submitted to the Coastal Commission to get their verification that it complied with thel;provision in the Local Coastal Plan Resubmittal Number 8 that a permanent funding source was developed for the Nature Interpretire Center. Agency/Council Member Horton asked if staff had projected costs for the multi-purpose Sports Facility/Ice Skating Rink. Mr. Salomone responded the Sports Fadlity/lce Skating Rink would cost in the neighborhood of $9 million and the underground parking would add considerably to the cost. Agency/Council had directed staff to look at shared parking, parking in the SDG&E right-of-way, as well as other items that could reduce the cost of the fadlity. Minutes September 7, 1993 Page 6 Agency/Council Member Horton asked if it was correct that if the facility was not built and revenue reimbursement to the developer was $25 million, then the City was not giving up anything. Mr. Salomone replied that was correct. To get the project built, to get Phase 1 built with all the infrastructure as well as all hotels and commercial and the potential for the Cultural Arts Facility, Agency/Council direction was that an incentive in the $25 million range would seem appropriate. That figure would be net of the revenues the project produced, of paying for City services, and would be derived from a split of the revenues of the project. The direction of the Agency/Council was that an incentive should be provided so the developer would agree to build the facility in Phase 1. The incentive would go up to $30 million from $25 million if that facility were built in Phase 1. An additional incentive clause provides that should the project perform in the manner Price Waterhouse stated it could possibly perform, and Mr. Barkett did a stellar job in providing all amenities and architectural features, and promoted the project, then he could get up to an additional $15 million in that same 25 year period. The City would benefit from that as the City~s share of the revenues would be considerably increased by that kind of performance. Agency/Council Member Horton stated she had a concern with approving the incentive package and then having the developer sell the property. She thought a non-assignment clause might be appropriate. Mr. Salomone agreed and stated it had been discussed with the developer. Insertion of a Duty to Perform condition was part of Agency/Council previous direction. Mr. Bill Barkett, General Partner, Chula Vista Capital, 864 Prospect Street, La Jolla, CA 92037, stated he agreed in the most part with staffs proposal. He asked that in all future documents the project owner be referred to as Chula Vista Capital. He believed staffs document provided a good workable framework for both the City and the developer, granted a lot of detail still would need to be worked out. Agency/Council Member Fox stated he also had a concern about reimbursement of "seed money" funds to the developer due to the fund raising effort on behalf of the Cultural Arts Center. He wanted to know if there had been discussion that the City should reach a certain threshold, significantly more than $7.5 million, before the City entertained offsetting the developer's "seed money" contributions through the fund raising effort. Mr. Barker thought the original intention was for the developer to put up money to hire a fund raiser which would "seed" the whole Cultural Arts Center and enable the City to go out and raise money from other individuals; not that the money the developer would be putting in would be used to build the Cultural Arts Center. The original charge to staff throughout the negotiations was for the developer to put up the "seed money" to hire the people so they could go out as professional fund raisers to raise the money. If this individual did not raise any money, the developer was still obligated to put up the $7.5 million. Agency/Council Member Fox asked if there was discussion in the negotiations where a larger amount of money, more than the $7.5 million, would need to be raised prior to an offset being given back to the developer for his "seed money" contribution. For example, say $20 million in the Fund, raised from the developer as well as through various other sources, before any offsetting would begin to take effect. Mr. Salomone replied that had not been a topic of discussion. Agency/Council Member Fox asked Mr. Barkett what his thought might be on that proposal. Mr. Barkett stated he would oppose it. As he understood the current proposal, he would put up $1.5 million "seed money" by the time he pulled his first Building Permit. That money would be used by someone the City would hire, under their sole control, to raise money for the Cultural Arts Fund. lfby chance they raised Minutes September 7, 1993 Page 7 $300,000 within the next two years, the next "seed money" contribution of $500,000 the developer was to put in would only be $200,000. Agency/Council Member Fox said he understood the developer would be getting offsets at certain threshold levels. He asked what Mr. Barkett's response would be to a proposal to wait a longer period of time and until more money was raised for the Fund before any offsetting would kick in. Mr. Barkett replied he would be open to hearing a proposal. He had no objection to another proposal, but on the other hand if no money was raised within a certain period of time, he would want the remainder of his obligation to cease. As he saw it, he was funding the City's fund raising effort, he would not have any control over it, and he did not know how feasible it was to build the Cultural Arts Center. The feasibility study on the Cultural Arts Center he had seen stated it was not a feasible project, yet any feasibility study that had been done on his project, everybody takes as gospel. He asked for fairness. Agency/Council Member Rindone stated the proposal before the Agency/Council did not "cut it", nor did it come anywhere dose and he was not happy with it. The proposal needed to be referred back to staff and a workable proposal needed to be developed so the City had some guarantees the multipurpose Sports Facility/Ice Skating Rink would be developed in Phase 1. The negotiators need to rethink and look at what was distributed back to the developer. The Agency/Council started at $0 and was now up to a potential $40 million. It would seem the Agency/Council had gone a long way from where they initially stood. He stated his displeasure with the proposal as it had come forward. He asked that the negotiators rethink how they could come up with a project that would be more financially feasible for the developer--e.g., shared parking and use of the SDG&E right-of-way so that it would reduce those type costs; and, not provide any rebatement of initial "seed money" funds. The entire sale of the project should be looked at, so it became feasible. The two amenities that had been in the project from day one was the Cultural Arts Center, with the developer donating the land and making a significant contribution to the Fund; and a guarantee the multipurpose Sports Fadlity/Ice Skating Rink would be built in Phase 1; and, no abatement for fund raising efforts to that committed by the developer to build the project. Chairman/Mayor Nader asked if there had been any input from any professionai cultural arts fund raisers, the City's Cultural Arts Coordinator, or the Cultural Arts Commission regarding the issue. Mr. Salomone noted the only consultant, AMS, that designed the fadlity, was involved in costing it out. The Cultural Arts Commission had been involved and the additional up front "seed money" proposal was based upon Dency Souval's testimony before the Agency/Council at its last meeting. Chairman/Mayor Nader commented he was the one member of Agency/Council who wanted to forego the multipurpose Sports Fadlily/Ice Skating Rink in order to promote the Cultural Arts Center. The certified LCP called for a park as an alternative land use for that area. If the multipurpose Sports Fadlity/Ice Skating Rink were not built would that free funds from that element of the project and enable the Agency/Council to apply that capital toward the Cultural Arts Center. That, he noted, might be something for staff to take a look at some point. Susan Fuller, 523 Welton Street, Chula Vista, 91911, as a member of the Bayfront Conservancy Trust Board and a member of the Planning Commission, stated she was familiar with the project, and individually, she wasinsupportoftheprojectasitwasaterrificplan. She expressed concern about some ofthe negotiations as they would seem to tend to postpone inevitable development of the property which the Bayfront Conservancy Trust was eager to see a project such as this developed. One of the great opportunities of the project would be to demonstrate that development and conservation could make a unique conuibution. The benefit assessment district had always been a part of the Local Coastal Plan, a plan to support the operation of the Nature Center. She was in total agreement with the one item of the negotiations which was to provide $500,000 yearly to support the operation of the Center. That was the figure given by the Board to Minutes September 7, 1993 Page 8 the City as the estimated cost to operate the Center. She did not believe there should be any relationship between the admission revenues, even those attributable to the development, nor any additional earned income (grants or fund raising efforts) by the Center and the annual obligation required by the benefit assessment district. The proposed configuration of the benefit assessment district did not comply with the Local Coastal Plan and did not adequately nor fairly support the Bayfront Conservancy Trust. It jeopardized the long-term stability of the Nature Center for the potential of a Cultural Arts Center. The Cultural Arts Center was never the number one item in the proposal for the project. It was added later to the plan and she felt the efforts to fund a Cultural Arts Center had clouded the negotiations for the project. Chairman/Mayor Nader noted his concern about the perception being promoted that there was some inherent conflict between the benefit assessment district, which was part of the Local Coastal Plan and which was always understood to be part of the project for the support of the Nature Center and the Cultural Arts Center. Agenee/Council had never directed that the Cultural Arts Center be funded at the expense of the Nature Center. He pointed out he would never have voted for the project without the Cultural Arts Center being a part of the plan. Ms, Fuller stated she felt the pressure placed on the developer to participate in the funding of the proposed Cultural Arts Center with "seed money" had indeed reflected on the way he was willing to negotiate a commitment to the Nature Center. Chairman/Mayor Nader requested clarification on the mechanism (formula) being negotiated for rebating, to the developer, based upon increased attendance at the Nature Center. Mr, Barkett responded the formula was structured based upon the Nature Centet;s history of attendance and the percent annual increase in attendance. If, when the Bayfront project was built, those attendees over and above those which had historically been going to the Nature Center which could be attributed to the Bayfront project, part of that increased revenue would be used to pay the City's principal and interest on City money used to build and fund operation of the Nature Center for the past four or five years. The remainder would be applied against the $500,000 annual obligation. The cost of living increase in the formula would be shared by both the City and developer. Agenee/Council Member Horton asked if the formula was offset by projected increases in tourism and other major projects within the South Bay. Mr. Barkett replied the formula had not yet been set, the negotiators were working on the parameters for creating the formula. He stated he agreed with Planning Commissioner Fuller regarding a conflict between the Nature Center and the Cultural Arts Center. The project had only so much money to give to the public benefits that it was creating and if there were no Cultural Arts Center there would be more money and he would not be fighting as hard to get reimbursements. Of the money that would be reimbursed by the City, the project must f'ucst earn it. The developer had to 'ffront" all the money to build the infrastructure and all the facilities. Chairman/Mayor Nader pointed out the Local Coastal Plan set up the benefit assessment district and called for the Cultural Arts Center as part of the project. Mr. Barkett stated the Local Coastal Plan said the benefit assessment district would be over the entire local coastal area, which was not just the MidBayffont. Chairman/Mayor Nader asked if that were correct. Mr. Salomone responded that the Local Coastal Plan stated that a permanent funding source be established for the Natare Center. It could be interpreted any way. Minutes September 7, 1993 Page 9 Mr. Barkerr pointed out the original Local Coastal Plan covered an area larger than the MidBayfront. The Local Coastal Plan also stated that a feasibility study for a Cultural Arts Center should be done, not that the developer had to do it. Agency/Council Member Honon noted that when the project went before the Planning Commission it did not have the Cultural Arts Center in the plan. Agency/Council knew there was concern about the financial feasibility of the project and yet Agency/Council continually placed further f'mancial burden on the development of the project to the point where Agency/Council may eventually destroy the project. The project was important to the community and the City had a developer willing to donate the property for a Cultural Arts Center, which was a significant and major contribution. A Cultural Arts Center would add great benefits to the community, but it was not appropriate to place that much burden--having to donate $10 million--on the developer to get the facility built in addition to donating the land. Agency/Council may want to consider getting perhaps $1-$1.5 million "seed money" up front so the City could hire the fund raising who could then, in turn, raise the funds necessary to build the Cultural Arts Center, but the burden did not need to be placed totally on the developer. The Agency/Council needed to seriously look at that Chairman/Mayor Nader said that the $10 million was not the whole burden for the Cultural Arts Center but did concede it was a significant mount. He noted that Agency/Council, over his objection, voted to put an $18 million net burden on the project for the 5000-seat multipurpose Sports Facility that nobody had explained how it was going to be filled on a regular basis with events. He agreed the Agency/Council needed to look at what its priorities were, among the various elements, that were a financial drain on the project. The Cultural Arts Center was one of the more exciting components of the project and he would like to at least see, somebody along the lines of a professional fund raiser come and inform the Agency/Council if there was a ghost of a chance under the scheme before Agency/Council voted on it. Agency/Council Member Fox concurred, conceptually, with Agency/Council Member Horton's comments. Agency/Council knew the issues and should hold a worksession/meeting as soon as possible. The Agency/Council needed to fred out, at least in speaking with professional fund raisers, as to the possibility of raising the kind of funds and the timeframe needed to raise the funds to construct a Cultural Arts Center. He agreed the land was a significant contribution but that Agency/Council was also making some significant and innovative gestures back to the developer--one being the revenue reimbursement scheme--so there was a balance. The Agency/Council should meet with the developer and in the meantime receive input from staff on their discussions with a professional fund raiser so that Agency/Council learned something about the possibility of raising the kind of funds needed to be raised. He expressed willingness to revisit the multipurpose Sports Facility/Ice Skating Rink issue. Agency/Council Member Rindone stated that it had always been a part of the plan for the Nature Center to be funded by an assessment district and that a permanent funding base for the Cultural Arts Center needed to be developed. Agency/Council Member Moore noted while the param eters for negotiating the Development Agreement was not the f'mal ideal, staff had come a long way in the negotiation process. The Agency/City was not making any money off the MidBayfront, the land did not belong to the City, it belonged to the property owner. In looking at the staff report, there were few items that the developer did not agree to, as listed in the staff versus developer position columns. The column that was missing was the individual/joint Agency/Council members positions. In order for there to be a Cultural Arts Center on the Bayfront there must be development. If the Agency/Council thought it had problems now finding the funds to construct the Cultural Arts Center, wait until it needed to be funded on a yearly basis/He urged members to take action about development on the MidBayfront. Mr. Barkett said staff, his consultants, and he negotiated the parameters for the Development Agreement in good faith. Neither staff nor he liked everything that had been negotiated but it was something both Minutes September 7, 1993 Page 10 parties could live with. Frankly, he was flabbergasted that the Agency/Council did not think it adequate. If the Agency/Council wanted to tweak aspects of the issues that had been negotiated, he would welcome that but he would not change any of the dollar figures as had been worked out between staff and him. Chairman/Mayor Nader said Agency/Council was told the plan would require no public subsidy. When public subsidy was first recently mentioned in the plan, he took the posifon that if additional amenities were being participated in to a great extent by the developer so as to make them feasible--e.g., the Cultural Arts Center--that might justify a public subsidy. If the revenue stream with which they were talking about subsidizing the multipurpose Sports Facility/ice Skating Rink toward the other elements of the project that were burdening development, perhaps there would be an enhanced ability to fund those other elements which would thereby take some ofthe burden off the development. He thought that perhaps that was the direction Agency/Council should take to get back to the original idea of an unsubsidized development. Agency/Council Member Fox asked Mr. Barkerr if the requirement to build the multipurpose Sports Facility/Ice Skating Rink was removed, how would that affect the f'mancial commitment to fund the Cultural Arts Center. Mr. Barker responded it would not change it at all. He had made that clear at the last meeting. He asked ff Agency/Council desired him to restate his position. Agency/Council Member Fox said that was how he understood Mr. Barkett's position to be. Mr. Barker stated when the project was originally proposed there was substantially more density than there was today. By the Agency/Council lowering the density it did not automatically make the project more feasible as the infrastructure costs were still the same--parking requirement was substantially the same, more park acreage had been added than in the original plan, the lagoon was the same. The density, which created the money for the developer, was less. He thought it counterproductive to rehash all that. A proposal was on the table and he stated his willingness to work it out with the Agency/Council. Agency/Council Member Horton pointed out the two items- -Cultural Arts Center and Nature Center funding- -needed to be restructured. She suggested that could be done by adjusting the amount Agency/Council was requiring the developer to donate toward the Cultural Arts Center. Additionally, she asked that a Duty to Perform or a Non-Assignment clause be added in the Development Agreement. Mr. Salomone noted a Duty to Perform was to be in the Development Agreement and that Agency/Council direction had been that the Development Agreement would be personal to Chula Vista Capital. Staff understood that to mean it was not transferable. Mr. Barkert said he would not accept that. He would accept it to the San Diego Unified Port District only; as to any other third party he would not accept it. Agency/Council Member Horton replied then perhaps there would be no agreement. Chairman/Mayor Nader asked Mr. Barkett to clarify his statement. Mr. Barkett said he would not accept a non-assignability clause in a Development Agreement. If the Agency/Council wanted to say that some developer had to come in and meet all Chula Vista Capital's obligations that would be perfectl3/free, if they want to set an objective standard, but not that it applied to Chula Vista Capital and Chula Vista Capital only. Agency/Council Member Horton asked Mr. Barkerr why he would accept that from the Port and not from the City. Minutes September 7, 1993 Page 11 Mr. Barkett rephed he believed the City believed the Port would possibly buy the land and they did not want to increase the value for him. He would accept that premise even though he did not believe it. If the Port did buy the property, they would not build "that" project. Agency/Council Member Horton said her concern was that if Chnla Vista Capital got these incentives from the City of Chula Vista and turned around and sold it for "x" amount more than what he paid for the property, that would put a greater burden on the new developer and funding for his project would be harder to get. Mr. Barkett stated he found that hard to believe as they would still have to do all the entitlements the City required. Agency/Council Member Horton asked Mr. Barkett why he would be afraid of having that type chuse included in the Development Agreement. Mr. Barkeli said he was not afraid of it, he was just saying he would agree to it but that it could not be on a subjective standard. Should he bring a developer in that wanted to build a part of the project, and they agreed to everything Chula Vista Capital had agreed to, the City should have no problem as long as the City checked them out and they met every requirement required of Chula Vista Capital. Why would the City not allow them to build the project. Agency/Council Member Horton said the City would not disallow them. She was not talking about elements of the project but should Chula Vista Capital sell the entire project to a different developer. Mr. Barker replied that if another developer agreed to everything the City and Chula Vista Capital agreed to, the City should not care as long as that developer met every requirement that Chula Vista Capital would be required to meet. Agency/Council Member Horton said the City's concern would be to get the project built. Mr. Barkett said if he sold the project for $35 million that would be because he had that much money in it, after buying the land for $17 million; and, he would be happy to show the Agency/Council the audited statements from Price Waterhouse. Mr. Salomone stated that a consideration be added that the only change to assignability would only be with Agency approval so that any assignability would have to be approved by the Agency. Agency/Council Member Horton stated she thought that would be acceptable. Mr. Barkeli said that would be acceptable to him as well. MOTION: (Fox/I-Iorton) to schedule a worksession/meeting as soon as possible to focus solely on the MidBayfront project and spend whatever time it took to reach conclusion or impasse. Agency/Council Member Horton felt, after listening to the developer, a worksession was not necessary if the concerns expressed were addressed by staff and the developer and returned to the Agency/Council with revisions to the proposal. Mr. Salomone clarified his understanding of what the Agency/Council had directed staff to do: [1] have the developer agree to fund the Nature Center, with an escalator clause, which was 6%--shared 3%, 3%; [2] seek more up front "seed money" for a professional fundraiser, have staff consult with a professional Minutes September 7, 1993 Page 12 fundraiser, and bring that input back; and, Agency/Council had a problem with hindering fundraising efforts by crediting the developer's total $7.5 million contribution based upon fundraising efforts early on or at all. Agency/Council Member Fox said if those issues could be solved by staff without a worksession he was amenable to that approach. Mr. Barkett asked if the monies raised by the Nature Center, e.g., grants included any additional monies from the attendance--would these be lumped together. Agency/Council Member Horton said they were not lumped together. She agreed the project would generate an additional number of attendees/tourism. Her concern was specifically the new funding sources for the Nature Center, which could be grant funds or whatever type of ftmdraising for the Nature Center might occur. Mr. Barkett said he did not include grants or other of type fundraising by the Nature Center either. His and staffs proposal only dealt with increased attendance to the Nature Center generated by the project. Assistant City Manager Morris noted the Director of the Nature Center had a concern that if he were able to achieve new funding sources through grants to the Nature Center that those would become part of the negotiation process. He had been informed that they were not part of the process and would not be at risk. In terms of grants, as they related to the Cultural Arts Center, they had not been discussed as part of the funding package. Agency/Council Member Horton pointed out that the wording in the staff report relative to the Nature Center did state "if new funding sources". Mr. Morris clarified, stating the intent of the wording was that should a replacement funding source for the Nature Center be achieved, then Mr. Barkett's obligation would be transferred to the Cultural Arts Center and that it would have a cap of $45 million. The intent was that the developer would not be totally relieved of his obligation but would be a new funding source for the Cultural Arts Center effort. SLIBb'IffLITE MOTION: (Horton/Fox) to consider the information presented as well as the concerns expressed by Agency/Council memben in further negotiations between staff and the developer that dealt with two elements of the negotiations: Nature Center and Cultural Arts Center funding end return in one week with a new proposal. Chairman/Mayor Nader requested that staff work with the Cultural Arts Commission and consult with a bonafide professional fundraiser to determine the impact of different schemes on the incentive for fundraising. He expressed concern on the lack of consultation with, or participation by, the Port as he was convinced that some of the things the City wanted to see down on the MidBayfront, particularly the Cultural Arts Center, were most likely to happen with extensive Port participation with the City and developer. He asked that consultation with the Port District be added as part of the substitute motion. Maker and Second of Motion agreed as long as it did not disturb the timetable requested for the report to be returned. Agency/Council Member Moore asked for a series of short motions that were dear, conrise, and understandable. Agency/Council Member Rindone asked that the multipurpose Sports Facility/Ice Skating Rink be included in the negotiations to reach agreement on stronger assurances that the facility will be built in Phase 1. The reason he was requesting it was that the developer could choose not to build the fadlity and he wanted assurance in the Development Agreement that the facility would, in fact, be built in Phase 1. Minutes September 7, 1993 Page 13 Mr. Barkett pointed out he would not be in town next week and requested it be continued for two weeks. Maker and Second of Motion agreed. Mr. Barker stated his agreement with the Port was null and void and he did not understand why they had to get involved in negotiations between the staff and developer. They could have their own separate negotiations with the City. Chairman/Mayor Nader said if the Port District came forward with a more specific interest in taking over the Cultural Arts Center porT. ion of the MidBayfront p]an that would alter the balance of consideration he was looking at in the proposed agreement. Mr. Barkett accepted the Chairman's point of view but thought the City should be talking and negotiating separately with the Port District. Chairman/Mayor Nader said it was not his intent to have the Port District involved in the negotiations between the developer and staff but, he wanted staff to talk concurrently with the Port District. Agency/Council Member Moore pointed out nothing had been discussed relative to the revenue reimbursement formula. Chairman/Mayor Nader stated, from his perspective, the appropriateness and mounts of the revenue reimbursement formula were tied to some extent to what the City would be getting. One way of approaching the Cultural Arts Center and Nature Center would be that the City might be better off relieving the developer of those obligations, thereby necessitating less City subsidy. The justification for subsidy was tied to availability of amenities and different types of trade-offs needed to be looked at. He believed staff, who had direction to report back to Agency/Council on the issue of fundralsing for the Cultural Arts Center, would want to include in that report options for changing the subsidy formula. Agency/Council Member Moore pointed out the current subsidy formula was based on the caliber of the development, the multipurpose Sports Facility/Ice Skating Rink, the lagoon, underground parking, the Nature Center, and the Cultural Arts Center. Mr. Barkett cautioned the Agency/Council not to look at the Cultural Arts Center and Nature Center as the only public amenities. Agency/Council Member Fox stated he hoped staff understood they did not have to be held to the $25 million and $45 million figures he mentioned at the August 3, 1993 meeting. Mr. Salomone mentioned that staff originally had higher figures than those; however, staff put a cap at $45 million. Agency/Council Member Rindone asked staff to look at the parking on the SDG&E right-of-way and shared parking to see if there could be movement in those areas without destruction of the project, yet reduce major costs. Mr. Salomone noted those were part of the agreement and that Planning staff could not look at those issues until the next phase, which would be preparation of Site Plans and layout of the project. Agency/Council Member Rindone asked if those issues could be evaluated in any degree in the report or if that was too far down the pike to be able to see the impacts of effect that the shared parking or the SDG&E fight-of-way may have on the financial or fiscal ability of the project. Minutes September 7, 1993 Page 14 Mr. Salomone stated his understanding was that staff could not do that at the present stage, but he would talk to the Planning Director and respond. VOTE ON SUBb'fIflJTE MOTION AS AMENDED, S-0-0. OTHER BUSINESS 7. DIRECTOR/CITY MANAGER'S REPORT - None. 8. (]tAIRMAN/MAYOR'S RFj~RT Ratification of appointment to the Town Centre Project Area Committee - Marsha Killian MOTION (Nader/Fox) ratify appointment of Marsha Killjan to the Town Cent~e Project Area Committee, approved S-O-O. 9. MEMBERS/COUNCILMEMBERS' COMMENTS - None. The meeting adjourned at: 10:20 p.m. to a Spedal Meeting of the Redevelopmerit Agency on Tuesday, September 14, 1993 at 6:00 p.m., immediately following the City Council meeting, Council Chambers, Public Services BuiIding. Respectfully submitted, Berlin Bosworth Secretary to the Redevelopment Agency