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HomeMy WebLinkAboutrda min 1994/06/07 CC MINUTES OF A JOINT MEETING OF THE REDEVELOPMENT AGENCY/ CITY COUNCIL OF THE CITY OF CHULA VISTA Tuesday, June 7, 1994 Council Chambers 7:42 p.m. Public Services Building CALL TO ORDER 1. ROLL CALL: PRESENT: Agency/Council Members Fox, Horton, Moore, Rindone, end Chairman/Mayor Nader ALSO PRESENT: John D. Goss, Director/City Manager; Bruce M. Boogsard, Agency/City Attorney; end Beverly A. Authelet, City Clerk 2. APPROVAL OF MINUTES: May 17, 1994' MSC (Horton/Nader) to approve the minutes of May 17, 1994 as presented. Approved 40-0-1 with Rindone CONSENT CALENDAR (Items pulled: none) CONSENT CALENDAR OH~'ERED BY AGENCY/COUNCIL MEMBER HORTON, reading of the text was waived, passed and approved 4.0.0-1 with Fox abstalnin~. Agency/Council Member Fox stated he would abstain from voting as he had not reviewed the information as he was out of town on City business. WRH'IEN CO1VI1VFUNICATIONS: None submitted. 4.A. HESOLUTION 1406 APPROVING A DOWN PAYMENT ASSISTANCE AND LAST RESORT HOUSING PAYMENT IN THE AMOUNT OF $7,313.76 PURSUANT TO THE ADOFrED HELOCATION PLAN FOR A RENTAL UNIT HOUSEHOLD LOCATED AT 459 F STREET WITHIN THE TOWN CENTRE II REDEVELOPMENT PROJECT AREA-At the Joint Meeting of 4/5/94 the Agency/Council approved Advance Assistance end Moving Expense relocation payments for the five te~nants located at 459 F Street. Marco and Cecelia Gonzalez hereby make their final claim for assistance. Staff recommends approval of the resolutions. (Community Development Director) B. RESOLUTION 17505 AUTHORIZING THE EXPENDITURE OF $7,313.76 PROM THE CMC CENTER EXPANSION PROJECT (#GG-130) CIP FOR THE PAYMENT OF A DOWN PAYMENT ASSISTANCE AND LAST RESORT HOUSING PAYMENT FOR A RENTAL UNIT HOUSEHOLD LOCATED AT 459 F STREET 5. RESOLUTION 1407 APPROVING A FINAL RENTAL ASSISTANCE CLAIM FOR A TENANT PREVIOUSLY RESEDING AT 334 CHURCH AVENUE AND TO AUTHORIZE PAYMENT IN THE AMOUNT OF $3,300 THEREFOR AS PART OF THE CHURCH AND CENTER PARKING LOT Minutes June 7, 1994 Page 2 PROJECT-The Agency approve~l the acquisition of this properly at its 3/3/92 meeting. Staff requests a final Rental Assistance payment for the last tenant to file a claim per Agency authorization. Staff recommends approval of the resolution. (Comraunity Development Director) 6. RESOLUTION 1408 APPROVING SIGN PROGRAM FOR SOUTHBAY CHEVROLET AUTOMOBILE DEALERSHIP ON OTAY VALLEY ROAD-The Chula Vista Auto Center Master Plan for the Chula Vista Auto Park requires that the Agency and the Design Review Committee approve sign programs for the new auto dealerships. Staff recommends approval of the resolution. (Community Development Director) 7.A. RESOLUTION 17506 APPROVING A SITE LEASE BY AND BETWEEN He RETAIL PROPERTIES I LIMITED PARTNERSHIP AND THE CITY OF CHULA VISTA FOR THE CHULA VISTA CENTER PARKlNG GARAGE-On 3/5/92 the Agency approved the Second Expansion of the Chula Vista Center. This recently completed project required $2.6 million in assistance by the Agency toward construction of the parking garage. Certificates of Participation were recently sold for the purpose of satisfying the Agency's assistance obligation. Staff recommends approval of the resolutions. (Community Development Director) B. RESOLUTION 17507 APPROVING AN OPERATING LEASE BY AND BETWEEN THE CITY OF CHULA VISTA AND He RETAIL PROPERTIES I LIMITED PARTNERSHIP FOR OPERATION AND MAINTENANCE OF THE CHULA VISTA CENTER PARKING GARAGE * * END OF CONSENT CALENDAR * * PUBLIC HEARINGS AND RELATED RESOLUTIONS AND ORDINANCES 8. PUBLIC HEARING REGARDING THE SALE OF SPACE NUMBER 111 AT ORANGE TREE MOBILEHOME PARK-This is a request to authorize the sale of Agency-owned Space 111 at Orange Tree Mobilehome Park. Staff recommends approval of the resolution. (Community Development Dh'ector) RESOLUTION 1409 APPROVING THE SALE OF SPACE NUMBER 111 AT ORANGE TREE MOBILEHOME PARK AND AUTHORIZING THE COMMUNITY DEVELOPMENT DIRECTOR TO EXECUTE A lrU'RCHASE AGREEMENT AND ESCROW INSTRUCTIONS This being the time and place as advertised, the public hearing was declared open. There being no public testimony, the public hearing was declared closed. RESOLUTION 1409 OI~'I~ERED BY CHAIRMAN NADER, reading of the text was waived. Chairman Nader questioned if it was the space where his office staff had made an inquiry of Commtmity Development staff. Chris Salomone, Dixector of Community Development, responded that he did not know. Chairman Nader requested that staff follow-up and let him k/low. Agency Member Fox stated he would abstain from voting because he had not reviewed the materials. VOTE ON RESOLUTION 1409: approved 4-4)-0-1 with Fox abstaining. Minutes June 7, 1994 Page 3 ORAL COMMUNICATIONS None ACTION ITEMS None submitted. ITEMS PULLED FROM THE CONSENT CALENDAR Items pulled: none. The minutes will reflect the published agenda order. OTHER BUSINESS 9. DIRECTOR/CITY MANAGER'S REPORT(S) - None 10. CHAIRMAN/MAYOR'S REPORT(S) - None 11. AGENCY/COUNCIL MEMBERS' COMMENTS - None ADJOURNMENT ADJOURNMENT AT 8:57 P.M. to the Regular Redevelopment Agency Meeting on June 21, 1994 at 6:00 p.m., immediately following the City Council meeting, in the City Coun(d Chambers. Respectfully submittal, by: Vicki C. Soderquist, Deputy Ci~..~~ MINUTES OF AN ADJOURNED SPECIAL MEETING OF THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA Tuesday, June 7, 1994 Council Conference Room 7:42 p.m. City Hall Building CALL TO ORDER 1. ROLL CALL: PRESENT: Agency Members Fox, Horton, Moore, Rindone, and Chah'man Nader ALSO PRESENT: John D. Goss, Director; Bruce M. Boogsard, Agency Attorney; and Beverly A. Authelet, City Clerk 2. APPROVAL OF MINUTES: None. BUSINESS Member Rindone noted there were two Redevelopmerit Agency agendas and questioned why that had occurred. Chris galoreone, Director of Community of Development, responded that the budget item was continued to the current meeting from the last budget workshop. The agenda had be~n forwarded to Council as a result of the adjourned meeting action. The other agenda had teken the normal path through the agenda process. The two agendas should have been combined. 3. RESOLUTION 1390 ADOPTING THE HEDEVELOPMENT AGENCY BUDGET FOR FY 1993-94 AND APPROPRIATING FUNDS THEREFOR-The FY 1993-94 Redevelopment Agency Budget was reviewed as part of the City budget approval process. As the Redevelopmeat Agency is a separate legal entity, it is necessary to approve the budget separately as required by California Community Redevelopment Law. The formal Agency adoption of the budget had been delayed in order to determine the full impact of State budget resolutions end to complete the evaluation of staffing needs for the Economic Development function in the Cornmtlnity Development Depa~ment as directed by City Council during and subsequent to the City's budget review process. This item was continued from the meetinl~ of June 1. 1994. Staff recommeads annroyal of the resolution. (Community Development Director) Mr. Goss stated one of the major issues was the deficit of the Agency that was occurring annually. One of the reasons for the deficit was a significant reduction in revenue due to State take aways and the Rohr re, assessment. It was unknown as to what the future State take aways would bo. It would take time for the {ax increment and various project areas to increa.s~ to the point where they would support the regular operating expenses. Options presented were: 1) cut back on City operations supported by the General Fund; 2) borrow from Genend Fund reserves; 3) borrow money from sewer reserves; 4) borrow money from General Fund and sewer reserves; 5) change the City's investment policy to enable the pooled investment account to be reinvested in the RDA; and 6) sell City assets. Staff had originally recommended that money be borrowed from the sewer fund in order to cover the deficit for 1993/94, but in reviewing all accounts of the RDA they would not be going into a deficit for 1993/94, but would next fiscal year. He proposed the Agency adopt the 1993/94 budget and replenish the low/moderate income housing fund in 1994/95 through one of the options presented. The turn around for the low/moderate income housing fund would have to be done as soon as possible becaus~ there was always a risk of a lawsuit. He presented a chart which showed the dates the properties had been pttrchased. He felt whatever action taken by the Minutes June 7, 1994 Page 2 Agency should be reviewed annually. He recommended the Agency sell some of their assets and look at the investment policy to bridge the gap until the tax increment of the Agency improved. He felt the Agency had been successful in promoting economic development. Member Rindone stated he was concerned with the deficit of the RDA and the loss of approximately $2.2 million annually. He questioned what the bond rating was for the 1993 Certificates of Participation. Susan Merrill, Interim Finance Administrator, responded they were between 6.4% and 6.8%. Member Rindone questioned if there was any significance in reissuing the Certificates of PaRieipatinn. He further questioned what had caused the change in the 1986 Tax Allocation Bonds in the proposed budget from the 3/15/94 Ms. Merrill responded that the first draft of the budget was done on a calendar year and the second draft was done on a fiscal year basis. Ch~s Salemone, Director of Community Development, stated for the last three years staff had been holding over the Agency budget until the State impact was known. Early in January staff was ready to come forward with the budget and the Agency had directed staff to look at economic development staffing. The same budget was brought forward in March. When it was sent back staff went to Finance to look at current fund balances, accurate data, etc. which resulted in the changes. Since the budget was six months late staff went back and got the fund balances which historically had not been available when the budget was approved. Member Pindune note~l the Agency was in month twelve of a twelve month budget and questioned how a public agency could spend money without an adopted budget. Mr. Salemone responded that the budget was adopted as part of the City's full budget package. What was not done was the nxlundant action of the Agcoey adopting the budget. Under State law that process had to be followed. Over the last three years because the State did not adopt their budget until months after the fiscal year and they were raiding the Agency's funds the budget had been held back to make those adjustments. The budget the Agency was operating under was a budget that had been adopted by the Council, but the duplicate budget had not been adopted by the Agency. Member Rindone stated he respectfully discerned with staff because they were sitting as the Agency and the authorization of expenditure of funds from the RDA had to be from the RDA budget. He did not feel it was appropriate to spend money from a budget that had not been approved. The budget should be adopted prior to the beginning of a fiscal year and if there were changes or modifications those should be brought forward as necessary. The Redevelopmeat Agency had been lax in that procedure and he would not condone that type of activity in the Member Moore stated Council approvod all the money whether it was the Agency or Council through the regular budget process. He questioned why the State required that the Agency forward a budget. Mr. Salemone responded that the City operated as n Redevelopmeat Agency under State law and they required the Agency to submit tt budget and audited the Agency frequently. Member Rindone stated an item that was on the 3/15/94 budget, and not on the revised budget, was fund 300 for Town Centre II and questioned why it was no longer it debt service. Lyle Haynes, Principal Commlnlity Development Specialist, responded that the particular item was folded in and separated into the 1987 Certificates of Participation, Series B, Town Centre I and Town Center II. It was a more accurate way of showing the actual debt service in the revised budget. Minutes June 7, 1994 Page 3 Member Rindone stated those numbers were in the previous budget and since the Mamh 15th budget it did not show a reflection of the $571,000. He requested that staff get back to him on that item. He referred to the shortfall and a fund balance of $760,000 from a loan from another City fund and questioned what the loan was. Mr. Goss respondud that since there was a positive fund balance the would not be a n~l for a loan from another City fund. Member Rindone questioned how much the Agency supported the General Fund through ganeration of sales tax revanues and the payment of staffing costs for other departments s'mc~ the 1986 Certifications of Participation had b~ea funded. Mr. Goss responded the bond money was not used solely for oparatious b~ause at the ting the Agency had other revenue sources such as minor leases and tax increments from various project aseas which belp~l to support operations. As far as supporting City staff, it was supporting City staff outside of Community Development that supported the operations of the Commullity Development Department. Member Rindone felt before the Agency could make a decision on the budg~ they needed to know what had born siphoned off from the RDA for staff costs. Them was another way of looking at it, i.e. it prevented the City from digging into the General Fund reserves to cover those costs. Therefore, it was building up Gen~ral Fund reserves at the expense ofthe Redevelopment Ageney. He referral to the twenty-fourpropartiesl~stedandquestionedifstaff could attest that all properties, except for one, i.e. b'23, had been directly purchased by the RDA budget 1986 Tax Allocation bonds. Mr. Salomone responded that he could not. The corporation yard had been purchased prior to that date and it would require further analysis to determine. Staff would report back to the Agancy with that information. Member Rindone stated $36 million had been anthorizKI in 1986 and there was just less than $.25 million in purchases, there was at least a gap of $11 million since 1986. He questioned where that $1.5 million was going every year. Mr, Salomone stated one clear source was to pay the de~bt service on the bends. Member Rindone stated he also wanted information on the payment of staffing costs to other d~partmeats annually since 1986. Mr. Goss stated the RDA operat~l in arrears as they put money into land, proparty, and development and they received the tax increment later and the City rec.~ived the sales tax. Historically, the General Fund had loaned money to the Agency and the Agency still owed money to the General Fund. Member Rindone stated he was going to urge the development of a plen to get the Agency out of debt and was trying to get the information necessary to devise that plan. He stated it was clear to him that they did not have a plan to address the deficit. Mr. Goss stated he had presented options for enusiderstion and had expoeted feedback from the Agency. He could develop a plan on what he wanted the City and Agency to do, but it was a major issue and there was a wide range of alternatives, therefore, he felt he needed to get feedback from the policy makers. Member Rindone questioned why that had not beea done on 3/15/94 as it impacted the solvency of the City. Mr. Goss stat~l because it was so close to the end of the fiscal year it was his intent to present those options during the course of the budget as the Agency looked ahead. It had originally appeared that a loan from another fund could Minutes June 7, 1994 Page 4 have finished out 1993/94 because the basic problem was much bigger and could not be solved in two or three months. Member Rindone questioned how many loans had been made to the agency and what the total was. Mr. Goss stated they had been done on an as needed basis with most of them made in the early and mid-1980's. He felt approximately $1-$1.7 million was still outstanding. He did not know the total amounts of the loans. Member Rindone requested that staff return with that information. Mr. Salomone responded that the information was conta/ned on page 3-19, i.e. $1,907,091. Member Rindone suggested that staff not only look at the loans in arrears, but the shortfall between the revenues and expenditures, what had to be mitigated because of the loss of revenues due to the tax aHocalion bonds having to pay the debt service back, and roturn with a plan for the Agency's consideration. Mr. Goss stated it was more complicated than that because they would have to take into account the tax increment received and how it had been reduced. Certain assumptions had also been presented, i.e. that in four or five years there would be the beginning Of a tax increment stream on the bayfront. If the Agency did not feel that was a correct assumption staff needed to know that before putting together a recommended solution. Member Rindone felt staff should present a preferred option and then several alternatives for review. In the interim he felt information should be brought back to the Agency on the four or five items discussed. Member Moore felt there was room for improvement regarding information flow. Redevelopment by design was in debt, the question was how much profit there was to pay the staff to continue their economic and redevelopment eftotis and have money to antice, attract, and subsidize business. The country was in a recession and the Agency reflected that. If the Agency wanted increased funding they needed to get the bayfront developed. He felt the Agency could sell the public works yard with the condition that they move within a specified number of years and a plan would be submitted with checks and balances. Information presented should include old data with strikeouts and new data for comparison. Member Fox stated he was extremely reluctant to approve any option that relied on bayfront revenues. MS (Rindone/ltorton) to trail the it~n for two weeks and direct staff to: 1) provide data requested during the discussion of the budget; 2) staff return with a plan for the adoption of the 1993/94 RDA budget; 3} staff retm'n with a plan for the adoption of the 1994/95 RDA budget; and 4) retm'n with a preliminary discussion of options for addrlssing the RDA deficit between the present time and 2002 or the projected bresk even point for revenues and expenditures. Member Hotton stated she did not want to consider the selling of the City corporation yard as the Agency would not get even half of the value of the propeTty. She felt it would be a tremendous loss to the Agency. Items 21 and 22 could be sold and she questioned if there was someone interested in the properties. Mr. galoreone responded that there were potential buyers for those two properties. Chairman Nader stated he would support the motion, but could not support an option that relied on bayfront revenues. He was concerned that a hayfront plan would be appwved that was not in the City's best interests just because it had been budgeted. VOTE ON MOTION: approved unanimously. Minutes June 7, 1994 Page 5 ORAL COMMUNICATIONS None OTHER BUSINESS 4. DIRECTOR'S/CffY MANAGER'$ REPORT(S) - None 5. CHAIRMAN'S/MAYOR'S REPORTfS} - None 6. AGENCY/COUNCIL MEMBER COMMENTS - None ADJOURNMENT ADJOURNMENT AT 8:57 P.M. to the Regular Re:development Agency Meeting on June 21, 1994 at 6:00 p.m., immediately following the City Council meeting, in the City Council Chambers. Respectfully submitted, BEVERLY A. AUTHELET, CMC, City Clerk by: Vi~ C. Soderquist, Deput~lClerk