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HomeMy WebLinkAbout04/16/1985 . . . .~".""I!";; ~ MINUTES REGULAR MEETING COMMUNITY REDEVELOPMENT AGENCY APRIL 16, 1985 The Regular Meeting of the Community Redevelopment Agency of the City of Santa Ana was called to order at 5:30 P.M. at which time the Secretary read the following public statement prior to a closed Agency session: "The Legal Counsel requests that the Redevelopment Agency recess to closed session pursuant to Government Code Sec. 54956.9 (A) to confer with its Attorney regarding pending litigation which has been initiated formally and to which the Redevelopment Agency is a party. The title of the litigation is Ace Muffler and Transmission et al vs. City of Santa Ana, et al. At 6:25 P.M. the Agency Members entered the City Council Chambers and, after the Pledge of Allegiance to the Flag and an Invocation given by Chairman Griset, the roll was called: PRESENT ABSENT John Acosta Daniel Griset, Chairman wilson Hart P. Lee Johnson, Vice Chairman Robert Luxembourger patricia McGuigan Dan Young Others in attendance: Robert C. Bobb, City Manager Rex Swanson, Deputy City Manager/Development Services Edward J. Cooper, City Attorney David N. Ream, Executive Director/Economic Development Mellmary McNeely, Secretary COMMUNICATIONS FROM THE PUBLIC There was no response when Chairman communications from the public. Griset called for MINUTES It was moved by Mr. Johnson, seconded by Mrs. McGuigan that the Minutes of the Regular Meeting held on March 19,1985 be approved as received: AYES: Acosta, Griset, Hart, Johnson, Luxembourger, McGuigan and Young None None NOES: ABSENT: . . ~ EXCLUSIVE RIGHT TO NEGOTIATE, RIVERVIEW COMMUNITY PARTNERSHIP (FIRST STREET/FIFTH STREET/SUSAN STREET/SANTA ANA RIVER) It was moved by Mrs. McGuigan, seconded by Mr. Johnson that the Agency grant a l80-day Exclusive Right to Negotiate to the Riverview Community partnership for the development of a single family residential project on property west of the Santa Ana River between First, Fifth and Susan Streets. AYES: Acosta, Griset, Hart, Johnson, Luxembourger, McGuigan and Young None None NOES: ABSENT: EXCLUSIVE RIGHT TO NEGOTIATE, MDC REALTY, INC. Chairman Griset stated that, after discussions with McDonnell Douglas and the Santa Fe Land Improvement Company, he was convinced that the proposed project would be a great opportunity for the City of Santa Ana to move forward since it would provide thousands of new jobs for its residents. He added that he was pleased to support the motion because he felt it was a statement which demonstrated the Agency's commitment to the best interests of the community. The City Manager pointed out that the number of jobs that would be furnished by this project had been mis-stated in that there would be approximately 6,000 jobs instead of the 4,000 first reported. He added that there would be approximately 1.7 million square feet of floor space in the new development. After further discussion, it was moved by Mr. Johnson, seconded by Mrs. McGuigan that the Agency grant a 90-day Exclusive Right to Negotiate to MDC Realty, Inc. AYES: Acosta, Griset, Hart, Johnson, Luxembourger, McGuigan and Young None None NOES: ABSENT: DISPOSITION & DEVELOPMENT AGREEMENT FOR THE C-5 SITE, LOWY DEVELOPMENT CORP. It was moved by Mrs. McGuigan, seconded by Mr. Johnson that the Agency approve and consent to the assignment of that certain Disposition and Development Agreement with Lowy Development Corporation, dated July 17,1985 to Lowy/Merit. AYES: Acosta, Griset, Hart, Johnson, Luxembourger, McGuigan and Young None None NOES: ABSENT: -2- . . . A-8 SITE DEVELOPMENT The Deputy City Manager/Development Services stated that the Agency was being asked to approve a Memorandum of Understanding between the Agency and Fiesta Marketplace Partners (formerly known as Greater Eastern Development Corporation) under the terms of which the development entity, along with eight individual owner participants, will develop a $10 million, 230,000 square foot festival marketplace inclusive of dozens of specialty retail shops, numerous eating establishments, including at least two family dinner restaurants and outdoor dining areas, a new tri-plex movie theater, a performing arts center and an abundance of professional office and artisan studio space. He added that this Memorandum of Understanding was a prelude to a Disposition and Development Agreement. He pointed out that, in his opinion, the Fiesta Marketplace would reinforce the downtown businesses. The Deputy City Manager/Development Services then introduced Mr. Irv Chase of Fiesta Marketplace Partners. Mr. Chase stated that there were three issues that were unresolved after the meeting in January between the Fiesta Marketplace Partners and the Agency: 1) Ownership; 2) Finances and 3) Design uses in the project. He added that he and his partners had worked hard to resolve these problems to their satisfaction and, he hoped, to the satisfaction of the Agency. He pointed out that those involved felt that the new name of Fiesta Marketplace Partners was more in tune with what they were trying to accomplish. He added that the partnership was now working on the second draft of the participation agreement and it is expected that this agreement will be executed within 30 days. He pointed out that the Agency Members had copies of a Letter from the Bank of America in which they agreed to provide the Letter of Credit for the project. He stated that it was discussed at the January meeting that the project should have a "Disneyland Main Street" atmosphere and that the developers felt they had accomplished this. be remiss if that their particularly Mr. Al Cruz, Mr. Chase told the Agency that he felt he would he did not mention the phenomonal support Partnership had received from the City staff, Ed Henning and Roger Kooi. He then introduced Architect for the project. Mr. Cruz thanked the Agency for the opportunity to appear before it. He then made a slide presentation showing the existing conditions of the buildings in the proposed site and called the attention of the Agency Members to elevations which were on display in the Council Chambers and stated -3- . . . that these embodied the proposed changes in the buildings. He added that the partnership wished to give a "festival" air to the buildings. He pointed out that the automobile showroom shown in the drawings will be a custom restoration center which has attracted the International Packard Motor Club annually, bringing people from 35 states and 3 foreign countries to Santa Ana. He added that he felt this would provide great exposure for the City. He then stated that he and Mr. Chase would be pleased to answer any questions the Agency Members might have. In response to a question from Mr. Young, Mr. Chase stated that they hoped to begin construction on the project by January, 1986. He added that there would be several phases to the project because of the number of businesses involved and that they would begin with the new construction on vacant lots and progress to the rehabilitation of the existing buildings. Mr. Young suggested that, when the Partnership had more concrete plans, they might like to return and make a further presentation to the Agency. Mr. Chase stated that the partnership hoped to be able to sign a Disposition and Development Agreement with the Agency within 60 days. He stated that they had overcome most of the obstacles and that the only things left that might present a problem were the negotiations for the tri-plex theater and the dinner house. Mr. Chase then introduced Mr. Rick Zimmer to give the Agency an overview of the financing to be obtained for the partnership. Mr. Zimmer development the other partnership. cost of the stated that the financing of the A-8 site would be complex because of the partnership and eight owners who were not a part of the He added that it was estimated that the total development would be approximately $10 million. The following members of the Fiesta Marketplace partnership addressed the Agency and thanked them for the strong support the Agency staff had given in reaching the proposed Memorandum of Understanding and asked the Agency to endorse the Staff Recommendation: Raymond Rangel Jose Cabbalos Robert Escalante Allan Fainbarg Mrs. McGuigan stated that she felt the Agency owed these businessmen a great deal of thanks for all of their hard work in putting this proposal together. -4- . . . The Deputy City Manager/Development Services stated that, as a representative of the Agency staff, he would like to thank the group of businessmen involved in the proposed development of the A-8 Site for working so hard on this very difficult project. Mr. Luxembourger stated that he would appreciate it if the staff would present an engineering report on this project to the Agency at a later date. He said that he was particularly interested in the theater. It was moved by that the Agency: Chairman Griset, seconded by Mr. Johnson 1. Approve the proposed concept for the development of the A-8 site as outlined in the attached Memorandum of Understanding. 2. Authorize staff to prepare the final Disposition and Development Agreement and notice June 25, as the date for a Joint Public Hearing of the City Council and the Redevelopment Agency for approval. AYES: Acosta, Hart, Johnson, Luxembourger McGuigan and Young None None NOES: ABSENT: AUTHORIZATION TO HIRE AN APPRAISER WITHIN THE MAIN STREET CENTER FOR LOSS OF GOODWILL It was moved by Mr. Acosta, seconded by Mr. Luxembourger that the Agency recommend that the Redevelopment Agency enter into an agreement with Higgins, Marcus & Lovett, Inc. for the goodwill appraisal of various tenants within the Main Street Center. AYES: Acosta, Griset, Hart, Johnson, Luxembourger, McGuigan and Young None None NOES: ABSENT: AGREEMENT AUTO MALL FOR SALE AND PURCHASE OF REAL PROPERTY, SANTA ANA This item was referred to the City Manager with the request that he return the item to the Agenda of the earliest possible Agency meeting. -5- SANTA ANA BUSINESS INCUBATOR FACILITY - SITE ACQUISITION It was moved by Mr. Johnson, seconded by Mr. Luxembourger that the Agency authorize the Chairman of the Community Redevelopment Agency to execute a real property purchase agreement with the South Pacific Land Company for acquisition of certain real property on the northeast corner of Poinsettia Street and Santa Ana Boulevard, for a purchase price not to exceed $423,000, as the site for the Santa Ana Business Incubator facility. . AYES: NOES: ABSENT: Acosta, Griset, Hart, Johnson, Luxembourger, McGuigan and Young None None APPROVAL OF RESOLUTION AUTHORIZING RELOCATION PAYMENTS It was moved by Mr. Young, seconded by Mr. Johnson that the Agency adopt Resolution 85-14: A RESOLUTION OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA AUTHORIZING THE EXECUTIVE DIRECTOR OF THE AGENCY TO APPROVE RELOCATION PAYMENTS. . AYES: NOES: ABSENT: Acosta, Griset, Hart, Johnson, Luxembourger, McGuigan and Young None None TO BY-LAWS COMMUNITY OF THE PROPOSED AMENDMENT REDEVELOPMENT AGENCY THE It was moved by Mrs. McGuigan, seconded by Chairman Griset that the Agency adopt Resolution No. 85-15: A RESOLUTION OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA AMENDING ITS BY-LAWS. AYES: NOES: ABSENT: Acosta, Griset, Hart, Johnson, Luxembourger McGuigan and Young None None Chairman Griset declared a recess at 7:10 P.M. with all of the Agency Members returning to the Council Chambers at 7:25 P.M. . PUBLIC HEARING TO ADOPT RESOLUTION 85-17 DIRECTING CONDEMNATION OF PROPERTY WITHIN THE A-lO DEVELOPMENT SITE (401 EAST FIRST STREET) Chairman Griset announced that it was the time and place for the public hearing on the issue of the public necessity to -6- . . . acquire by condemnation property identified by Assessor Parcel Numbers, as Book 398, Page and Block 516, Parcels 11 and 12, for redevelopment purposes. He then asked staff to identify the property and the project and to comment on the factors and evidence necessitating the condemnation action. He asked that staff set forth why the public interest and necessity required the project: why the project is planned or located in the manner that will be most compatible with greatest public good and the least private injury: why the property sought to be acquired is necessary for the project: and, whether or not the offer as required by Section 7267.2 of the Government Code has been made to the owner or owners of record, or the offer has not been made because the owner cannot be located with reasonable diligence. The Real Estate Manager read the following statement: "The property at issue is located at 401 East First Street, on the northeast corner of First and French Streets, and contains approximately 13,500 square feet of land area. It is improved with an almost new concrete block building, in excellent condition, containing 3,250 square feet, and an older wood and stucco building containing 660 square feet. The new building is occupied by the property owners, doing business as the Ace Muffler Shop, and the older building is occupied by a tenant doing business as Santa Ana Auto Electric. The property is owned by Mr. Miguel Armando Pulido and four relatives. The public interest and necessity require the property for several reasons. The Redevelopment Agency has entered into a Disposition and Development Agreement, dated June 25,1984, with URBATEC, a California corporation as the redeveloper. The contractual agreement required the Agency to acquire a four square block area, including the subject property, for conveyance to URBATEC, for development of a neighborhood shopping center including over 100,000 square feet of retail space and parking for 460 vehicles. Shopping center anchors will be a major market and drug store. Sixteen of twenty-one ownerships within the site have been acquired, representing over three-quarters of the site. For your general information, negotiations are continuing with the Salvation Army, the owner of most of the unacquired property in this site. The timing of the Army's move to Anaheim is a complicating factor in our negotiations, and we are endeavorning to make that transition as smooth as possible for the Army. The propsed development, the neighborhood shopping center, hill serve the needs of the growing downtown residential -7- . community including over 1600 planned in the past several neighborhoods surrounding the benefit of a convenient, quality to quality and competitive particularly important to the population, such as the elderly. units of housing built or years. These units and the downtown do not have the shopping center. proximity shopping opportunities is less mobile segments of our The subject project is situated in the center of the development site on First Street, the major artery serving the site. The subject property is necessary to the development to provide adequate visual exposure, line of site exposure which is of critical importance to the major anchors, necessary parking space, and land area sufficient for development of the ancillary businesses required to make the shopping center a viable project. The project is planned and located pursuant to hearings previously held by the Redevelopment Commission, the Redevelopment Agency and the City Council. . An offer of just compensation has been presented to the property owners pursuant to Section 7267.2 of the Government Code. This project will benefit the general public, and need not create any private injury or hardship. It is in fact our guiding principle that any project for the public benefit, be it a street widening, a new fire station, or a redevelopment project such as this proposed shopping center, need not be implemented at the expense of any private individual or business. Federal and State acquisition and relocation laws have evolved to the point that a property owner or businessman can be fully compensated for any economic loss possibly incurred as a result of being displaced. California, with its provisions compensating a business for any loss of goodwill, is in the forefront in this regard. It is for these reasons that we believe that this beneficial project can proceed while the financial and business interests of the property owner can be fully protected." Chairman Griset staff report. then called upon the City Attorney for a . The City Attorney pointed out that Mr. Pulido had filed two law suits against the Agency and that the City Attorney's office had been in negotiations with the plaintiff. He added that he had offered fair market value to Mr. Pulido for his property and indicated that the Agency would deposit the money in court and permit Mr. Pulido to immediately withdraw the funds. In exchange for withdrawing the law suits, the City Attorney indicated that Mr. Pulido had been offered another site worth approximately $250,000, plus -8- . relocation costs estimated at $15,000 to $16,000 plus reimbursement for goodwill. He added that he had offered to permit Mr. Pulido to remain at his present location until June, 1985 so that he could rebuild on the new site. Chairman Griset announced that the Agency would like to hear from those people who desired to address the Agency on this issue. He added that those that desired to address the Agency, should step forward to the podium and give their name and address. He asked that they limit their comments to five minutes and identify to which property their comments pertained. He asked that those speaking keep in mind the requirements of Section 1245.235 of the Code of Civic Procedure that all comments should only address the following four issues: 2. Whether the project: Whether the project is planned or located in the manner that will be most compatible with the greatest public good and the least private injury: public interest and necessity require the 1. 3. Whether the property sought to be acquired is necessary for the project: or . 4. Whether an offer, as required by Section 7267.2 of the Government Code, has been made to the record owner. He then asked the Secretary if there were any written communications and she read telegrams from the following people, all of whom asked that the Agency proceed with all of its planned projects: Jay Meehan of CM properties, Santa Ana, CA. John McKay of McKay, Byrne, Graham and Van Dam of Santa Ana, CA. Adrienne Thome Hennings of Santa Ana, CA. Robert Neal of The Consolidated Capital Companies of Century City, CA. . Chairman Griset called a recess at 8:45 P.M. with all Members of the Agency returning to the Council Chambers at 9:00 P. M. Chairman Griset then asked for all those persons in favor of the Resolution 85-17 to step forward and address the Agency. Those speaking in favor of the Resolution were: -9- . . , Victor Alleman Allan Fainbarg Jay Meehan Helen Pearl John Co il Bill Hill Alexander Nalle Chairman Griset then asked for all those persons opposing Resolution 85-17 to step forward and address the Agency. Those speaking against Resoltuion 85-17 were: Ralph Allen Richard Brandt Daniel Calderson Mickey Conroy Al Cruz Dale Dekert Cliff Frazier Hector Godinez Harry Greenberg pricilla Holmburg Lee Kearney Mike Leach Nanette Lenschel Nativo Lopez Robert Lopez Mickey Madden Charles McClung, Jr. Salvadore Mendoza Rudy Montejano Art Murietta Clara Nava Manuel pena Luis Pulido Miguel pulido, Jr. Ralph Quiroz Merle Rabine Gerald Ramos Sam Romero David Scarborough Paul Sepulveda Roul Silva Bob thompson Gerald Wolf Jerry Wolfe Chairman Griset then asked if any of the Agency Members had questions of staff or of the Pulidos. Mrs. McGuigan asked if the Pulidos had ever received any written commitment from a developer who was willing to incorporate the Ace Muffler Shop into the A-8 site, to which Mr. Miguel pulido, Jr. responded that he had oral commitments regarding this proposed development but none were written. Mrs. McGuigan asked staff if URBATEC had received a written denial of funds from the Bank of America to which the City Manager r~sponded that he had had discussions with the Bank of America in which they had indicated to him that they would not finance the development with the muffler shop as a part of it. Mr. Hart indicated that he had a similar discussion with the Bank of America. Mr. Hart then asked the City Attorney that if, in his opinion, the Agency failed to deliver the site would it be a breach of contract and would the Agency be exposing itself to considerable liability, to which the City Attorney responded that this could be the case. -10- . . , In response to a question from Mr. Luxembourger, the City Manager stated that staff and URBATEC had had extensive discussions regarding changing the site plans to include Ace Muffler. Mr. Acosta said that he would like to find out what method staff used to arrive at the point that they would come to this meeting and say that Ace Muffler is not a good use. He added that he could not find any place where it was mentioned that a muffler shop should not be located there and he would like to know what facts staff has. The Deputy City Manager/Development Services pointed out that, when Gordon Bricken was Mayor, there was a project called "Operation Crossroads" which proposed that the Agency would invest time and money to improve the east side of the downtown area. He added that staff had requested a consultant with appropriate qualifications to do extensive master planning of this area because staff did not feel the Agency had enough facts to proceed. He pointed out that URBATEC was selected as the consultant and that, at the end of the study, had proposed a mixed-use project for this area which would also include the McLean property. He added that another property was suggested for a residential development and that URBATEC was given an Exclusive Right to Negotiate for the site at First and Broadway. He pointed out that the Agency had asked for a shopping center and that staff had looked for a major site on First Street to serve the existing neighborhoods. He pointed out that staff had brought a recommendation for a shopping center on the A-lO Site before the Agency and that it had been approved. Mr. Acosta commented that what the Deputy City Manager/ Development Services had said was the history of the A-lO Site but that what he wanted to know was what members of staff were involved in making the staff recommendation on the A-lO Site. The Deputy City Manager/Development Services replied that he, together with the other staff members and the Development Team, had been responsible for the decision. He added that the Development Team was always asked for recommendations on matters such as the development of the A- 10 Site. In response to further questioning from Mr. Acosta, the Deputy City Manager/Development Services stated that the following were members of the Development Team: Executive Director/Economic Development Executive Director/Community Development and Housing -11- . . , Executive Director/Public Services Executive Director/Water utilities Downtown Development Commission Director Development Manager Mr. Young moved that the Agency not adopt Resolution 85-17. The motion was seconded by Chairman Griset. Under discussion, Mr. Luxembourger stated that he felt it would be helpful if a study session could be held to educate the people prior to a public hearing. He added that, unfortunately, people read the newspapers and accepted their reports as gospel. He stated that he felt the things that had been said in this meeting had hurt not only the community but also everyone present, as individuals. He said that he felt each side had many valid points and that neither side was totally wrong. He added that he felt the public should understand that many manhours were put into deliberations regarding this issue. He added that he would like to ask each of those present, as individuals, not to come to Council meetings to wave banners. He pointed out that the Agency Members needed facts and help and not unnecessary verbiage. He stated that he would support the motion because he had never supported URBATEC, adding that he was not satisfied with them as a developer. He added that he was very hurt because he could not support staff since he felt that much of their material was very good. He stated that he believed that the Agency members had tried very hard to do their best and that, in his opinion, staff also tried to do what was best for the community. He added that he detected a division of the community and hoped that everyone would leave the Council Chambers in a business like manner and bury the hatchet. Mrs. McGuigan pointed out that in the not too distant past the City had been negotiating with Group W Cable on a contract and that during the deliberations she had said that "a deal is a deal" when the City Council wanted to go back and renegotiate. She said that she felt the Agency has an excellent staff who has been bringing excellent projects, such as the McDonnell Douglas development, before the Agency. She added that she felt that everyone should work with the staff and the developer and give them an opportunity to put together a good development. She added that, in her opinion, the Agency is at the crossroads and that it was time for everyone to work together. Mr. Young said that offering the motion was harder than how he would obviously vote. He added that, in his opinion, there were certain aspects of what had been learned during the discussion that were persuasive. Mr. Young stated that -17.- r . . 8 he felt the Agency should be able to admit the decision was a bad one, correct the error and continue to move forward, hopefully with the community's support. Chairman Griset then the following results: called for a vote on the motion with AYES: Acosta, Griset, Hart, Johnson, Luxembourger McGuigan and Young None None NOES: ABSENT: ADJOURNMENT There being no further business to come before the Agency, the meeting was adjourned at 10:32 P.M. ~ L4~ Rex Swanson, Executive Director Daniel E. Griset, Chairman -13-