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HomeMy WebLinkAbout75A - PH 75 FT DIGITAL PYLON AUTO MALLREQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: OCTOBER 17, 2017 TITLE: PUBLIC HEARING - ZONING ORDINANCE AMENDMENT NO. 2017-03 TO AMEND SPECIFIC DEVELOPMENT NO. 60 TO ALLOW A NEW 75 -FOOT TALL DOUBLE FACE DIGITAL ILLUMINATED PYLON SIGN AT THE SANTA ANA AUTO MALL LOCATED AT 1505 SOUTH AUTO MALL DRIVE — SCOTT HAMPTON, APPLICANT / APPROVE SALES TAX LOAN AGREEMENT BETWEEN CITY OF SANTA ANA AND SANTA AUTO MALL AUTO DEALERS ASSOCIATION; APPROVE PAYMENT TO EMI INC. FOR THE PURCHASE OF AN LED SIGN AT THE SANTA ANA AUTO MALL {STRATEGIC PLAN NO. 3,21 RECOMMENDED ACTION CLERK OF COUNCIL USE ONLY: APPROVED ❑ As Recommended ❑ As Amended ❑ Ordinance on 15' Reading ❑ Ordinance on 2n' Reading ❑ Implementing Resolution ❑ Set Public Hearing For CONTINUED TO FILE NUMBER NOV 0 7 2017 1. Adopt an ordinance approving Zoning Ordinance Amendment No. 2017-03. 2. Authorize the City Manager and the Clerk of the Council to execute a Sales Tax Loan Agreement between the City of Santa Ana and the Santa Ana Auto Dealers Association LLC, subject to non -substantive changes approved by the City Manager and the City Attorney. 3. Approve the payment to EMI, Inc. for purchase and installation of an LED sign at the Santa Ana Auto Mall PLANNING COMMISSION ACTION At its regular meeting on September 25, 2017, the Planning Commission recommended that the City Council adopt an ordinance approving Zoning Ordinance Amendment No. 2017-03 to amend Specific Development No. 60 of the Santa Ana Municipal Code (SAMC) to allow a new 75 -foot tall double face digital illuminated pylon sign at the Santa Ana Auto Mall located at 1505 South Auto Mall Drive. The Planning Commission made no changes to the modifications outlined in the attached staff report (Exhibit A). 75A-1 Zoning Ordinance Amendment No. 2017-03 — Amend Specific Development No. 60 for Santa Ana Auto Mall Digital Sign October 17, 2017 Page 2 DESCRIPTION Scott Hampton, representing HSA LLC., is requesting approval to install a new 75 -foot tall double face digital illuminated pylon sign at the Santa Ana Auto Mall. The proposed code changes will allow installation of a more visible sign utilizing new L.E.D. technology. Currently, SD -60 standards allow a 70 -foot tall, 835 -square -foot, double -sided electronic reader board sign which was approved in April of 1994 and constructed shortly after. Since the date of construction of the existing , pylon sign, competing auto malls have been approved with new full color digital electronic message display signs. To facilitate the new sign, modifications to the specific development zoning document are needed. The modifications would allow for an increase in total height of 75 feet and a maximum signable area of 1,200 square feet for the new sign. One additional change to the code will eliminate the option for individual dealerships to place a logo or name brand on the column of the sign. The new sign will help provide an enhanced method of business identification and advertising and will contribute to the community and the City by advertising the Auto Mall regionally. The Auto Mall recognizes that the current sign is obsolete in nature and allowing the new sign will help ensure that the Auto mall remains competitive to other automobile centers in the area. Full sized site plans are available for public viewing in the Clerk of the Council Office. Sales Tax Loan between the City of Santa Ana and Santa Ana Auto Mall Dealer's Association Exhibit C The City has maintained a long and successful relationship with the Santa Ana Auto Mall (Auto Mall) for almost forty years. During that time the Auto Mall has become a regional destination in purchasing and/or leasing vehicles. As a result of the successful business environment for the Auto Mall, it has been a high performing Sales Tax generator for the City. Since 2011, the Auto Mall has undergone extensive renovation of its facilities totaling approximately $66 million, which includes modernization of the various components of the existing dealers for consumers as well as expansion of its inventory base. Also it has attracted new franchises / dealers to the Auto Mall expanding their vehicle selection. This recent investment by the dealers has allowed the Auto Mall to remain competitive with other nearby dealers and has provided for future increase in the amount of vehicles to be sold/leased resulting in both higher revenue and greater sales tax for the City. Adoption of the ordinance and recommended actions will allow for the purchase and installation of the new sign. In order to continue leveraging its investment of its dealers, the Auto Mall has approached the City to assist with the Purchase of an Auto Mall Sign (Sign). The sign will be utilized as the primary advertising medium, for the. Auto Mall, reaching approximately 250,000 vehicles a day traversing on the 55 freeway. The Sign will contain up -to date LED technology and disclose the various dealers in business at the Auto Mall along with the various incentives for prospective buyers. 75A-2 Zoning Ordinance Amendment No. 2017-03 — Amend Specific Development No. 60 for Santa Ana Auto Mall Digital Sign October 17, 2017 Page 3 The Sign is estimated to increase revenue for the Auto Mall which is projected to increase approximately 8% to 12% (Exhibit D) of Sales Tax for the City. A review of the previously completed five fiscal years disclosed the average sales tax received by the City (from the Auto Mall) is approximately $2.8 million. An analysis conducted by the Auto Mall anticipates the Loan to be repaid the City (General Fund) in approximately six years. The assistance requested by the Auto Mall is as follows: • Payment of the Sign - $1,032,948 • Term - 10 years • Payable - 50% increase in Sales Tax over Base Year • Base Year - Calendar Year 2016 • Other — Remaining loan balance will be repaid by the Auto Mall if increase in Sales Tax is not incurred As noted if the projected sales tax increase is not received by the City, the Auto Mall will be responsible for repaying the remaining loan balance at the end of the loan term including accrued interest. Funding of the Loan The Loan to the Auto Mall will be funded, from the City's Operating Reserve which as of June 30, 2017 maintained a balance of $42,397,974. The funding of this loan will reduce the Operating Reserve•to $41,364,446. When the repayment of the Loan occurs, via fifty percent of the sales tax received over and above the base year, the Operating Reserve will be increased by the amount of the repayment earned in the given year. Payment to EMI Signs EMI (Electric Media, Inc.) is the vendor designated by the Auto Mall to demolish the existing sign; and install the new sign (see Exhibit E). The City's sole responsibility is to furnish payment on behalf of the Auto Mall. Subsequently the Auto Mall will be responsible for the operation, maintenance and liability of the Sign. As noted above, the Sign costs will be $1,032,948. In addition, Auto Mall has also agreed to provide the City access to sign for the purpose of marketing City sponsored events (e.g. Council or Commission or Special events). The programming would assist in increasing notification efforts to the public for City business and recreational events. STRATEGIC PLAN ALIGNMENT Approval of this item supports the City's efforts to meet Goal #3 - Economic Development, Objective #2 (create new opportunities for business/job growth and encourage private development through new General Plan and Zoning Ordinance policies). 75A-3 Zoning Ordinance Amendment No. 2017-03 — Amend Specific Development No. 60 for Santa Ana Auto Mall Digital Sign October 17, 2017 Page 4 FISCAL IMPACT There is no fiscal impact associated with this action regarding the Planning and Building activities. Sales Tax Loan Agreement A Receivable will be established in the General Fund Note Receivable account (01101001- 11465) in the amount of $1,032,948. Repayment will be made by offsetting Sales Tax received by the City which is fifty percent over the base year amount (noted above). Interest received / accrued annually will be recorded in Earnings on Investments account (01102002-58000). Payment to EMI, Inc. Funds will be appropriated from the General Fund Note Receivable account (01101001-11465) in the amount of $1,032,948 for the purchase and installation of the sign and funded via the City's General Fund Operating Reserve (fund balance). Candida Neal, AICP Acting Executive Director Planning & Building Agency IO:rb S:RFCA\10-17-17\ZOA2017-03.m APPROVED AS TO FUNDS AND ACCOUNTS: Francisco Gutierrez Executive Director Finance and Management Services Agency Exhibit: A. Planning Commission Staff Report B. Ordinance C. Sales Tax Agreement D. Auto Mall Deal Points E. EMI Signs Invoice 75A-4 REQUEST FOR Planning Commission Action PLANNING COMMISSION MEETING DATE: SEPTEMBER 25, 2017 TITLE: PUBLIC HEARING - FILED BY SCOTT HAMPTON FOR ZONING ORDINANCE AMENDMENT NO. 2017-03 TO AMEND SPECIFIC DEVELOPMENT NO. 60 TO ALLOW A NEW 75 -FOOT TALL DOUBLE FACE DIGITAL ILLUMINATED PYLON SIGN AT THE SANTA ANA AUTO MALL LOCATED AT 1505 SOUTH AUTO MALL DRIVE (STRATEGIC PLAN NO. 3, 2) Prepared by Ivan Orozco. PLANNING COMMISSION SECRETARY APPROVED ❑ As Recommended ❑ As Amended ❑ Set Public Hearing For DENIED ❑ Applicant's Request ❑ 'Staff Recommendation CONTINUED TO Acting Executive irector Acting Plari ing Manager RECOMMENDED ACTION Recommend that the City Council adopt an ordinance approving Zoning Ordinance Amendment No. 2017=03 to revise Specific Development No. 60 of the Santa Ana Municipal Code (SAMC). Executive Summary Scott Hampton, representing HSA LLC., is requesting approval to install a new 75 -foot tall double face digital illuminated pylon sign at the Santa Ana Auto Mall. The proposed code changes will allow installation of a more visible sign utilizing new L.E.D. technology. Staff is recommending approval of the request because the site meets all Santa Ana Municipal Code requirements and applicable development standards and because the site is located away from any sensitive land uses. Table 1: Project and Location Information Item Information Project Address 1505 South Auto Mall Drive Nearest Intersection Auto Mall Drive and East Edinger Avenue General Plan Designation Industrial (IND) Zonin Designation $ ecific Develo ment SD No. 60/Santa Ana Auto Mall Surrounding Land Uses North Automobile Dealership and LOSSAN railroad corridor East Costa Mesa SR -55 Freeway South Automobile Dealership West Automobile Dealership Pro erty Size 120,661 square feet 2.77 acres Existing Site Develo ment The site contains an existing automobile dealership building. Use Permissions Permitted by right Zoning Code Sections Affected Use Signage Requirements I SD -60, Section No. 3 ISD -60, Section No. 8 EXHIBIT A 75A-5 Zoning Ordinance Amendment No.'201 V03, September.25, 2017 Page 2 Project Description Currently, $D=60 standards allow.a 70 -foot tall, 835 -square -foot, double sided: electronic reader, board sign. The applicantiis now proposing to, remove the existing teader'board sign and construct a new full-color double-sided,75-foot tall, 11020-square400t LED sign.. As a.result of the new sign's larger size, .changes to. the 'SD are needed that will allow the new sign to be, constructed. Table 2rAuto Mall Reader Board Signage'Requirements Standards Required by current,SD NoAQ 'Proposed by, amendment to'SD'Nd. 0 One electronic reader board sign One full color digital electronic message. Pylon.Sign for the Santa And Auto Mall shall display sign for the Santa,Ana,Auto'Mall be,p&mltted,along the Costa -Mesa_ shall be permitted along the Costa Mesa (SR -55) Freeway. (SR -55) Freeway. Maximum Height 8f P Ion.Si" n 70;Feet 75 Feet ,Square Footage of. Sigh'Face g35 Square Feet l7 ptor 1,206Square Fee t The copy area.for individual merchandise shall be limited to .either the registered logo or the Dealership Branding manufacturer's product name. Colors utilized shall be the To be deleted !standard auto manufacturer's color mode, which is typically a shade of red,, blue or black'. Prolect'Backaround The'Santa Ana Auto Mall is constantly striving to be competitive with similar auto malls in the surrounding area, including those 'in Costa Mesa,. Garden Grove, Tustin and. Irvine. Over the years, ;the majority of the dealerships within the auto mall have either expanded from their existing footprints_ or have remodeled their buildings, all in an effort to remain competitive. In April 1994, the City of Santa Ana approved a proposal to construct a 70 -foot high electronic reader board designed to be used for advertising for the existing automobile dealerships. 'Since the date of construction of the existing pylon sign, competing auto malls have been approved with new full color digital electronic message display signs. The Auto Mall originally approached the City approximately two years .ago with a similar proposal, but the City never received a formal application. The ownership's 'association is now requesting that the City partner with them in the construction of a new full color digital electronic message display :sign. To facilitate the new sign, modifications to the specific development zoning document are needed. 75A-6 Zoning .Ordinance Amendment No: 2017-03 September 25, 2017 Page 3 Table 3: Proiect *Analysis .Issue or Topie. Analysis CEQA7ype The proposed sign conforms to all'the conditions and provisions of the Document Type electronic message display:section of the Santa Ana Municipal Code (Sec. 41-885). These standards are designed to minimize light intrusion Conformity to development into any surrounding periods and require that brightness be automatically standards for digital signs adjusted depending on weather and ambient light conditions. Additionally, Exempt or Analysis the proposed sign, the subject, property, and corresponding structures will be in compliance with all applicable development standards in SD -60.. Strategic Plan •Ali g ninerit The sign will not be detrimental to persons residing or working in the Approval of this item supports the City's efforts to meet Goal No.3 (Economic area as it is located within an area of the City that is, predominantly Proximity to Sensitive Land Uses commercial in nature with no sensitive land uses located nearby. In and encourage private development through new General Plan and.Zoning addition, the SR -55 freeway provides a buffer between the project site Ordinance policies. and residential uses in Tustin. The new sign will help provide an enhanced method of business identification and advertising and will contribute to the community and, the City by advertising the Auto Mall regionally. The Auto Mall Significant Impacts to Project Site recognizes that the current sign is obsolete in nature and allowing the. new.sign will help ensure that the Auto mall remains competitive to other automobile centers in the area. Since the sign is a replacement of an existing pylon sign no negative, impactswill occur to the project site. Staff has analyzed the applicant's request and has worked closely with the firm contracted to construct the sign to ensure that its design and architectural, style. match the modern, high-tech industrial architecture required for all structures in the Santa Ana Auto Mall. In addition, modifications to SD -60 require the proposed sign will allow the City to enter into an agreement with the. Auto Mall association for revenue sharing. This agreement, part of a separate effort led by the Community Development Agency, will provide enhanced revenues to:the City while providing new signage and advertising options to the Auto Mall through the digital sign. Table 4• CEQA Strategic Plan Alignment and Public Notification & Community Outreach, CECA, Strategic Plan Ali nment,;and'Public Notification &CbmmunityOutreach CEQA CEQA7ype Cate orical Exemption Section 15311 Document Type Existing Facilities ER No. 2017-107 Class 11 exemptions apply to accessory structures. The proposed sign is a replacement of an existing pylon sign which is located 10 feet.south of the proposed Reason(s) location. As the new sign will only be a replacement and is partof a larger auto mall Exempt or Analysis development and no other building expansion being proposed, this accessory structure will not result in a substantive change to the site. Strategic Plan •Ali g ninerit Approval of this item supports the City's efforts to meet Goal No.3 (Economic Goal(s) and Development) Objective No. 2 of creating new opportunities for business/job-growth Policy(s), and encourage private development through new General Plan and.Zoning Ordinance policies. 75A-7 Zoning Ordinance -Amendment No. 2017-03 .September 25, 2017 Page 4 Public Notification & Community- Outreach A public noticed was posted on the project site on September 15, 2017. Required Measures Notification by mail was mailed to all property owners and occupants within 500 -feet Of the project site on September 15; 2017. Newspaper posting was published in the Orange County Reporter on September 15, 2017. Conclusion The proposed action would amend Specific Development (SD) No. 60. provided within this report, staff recommends that the Planning Commission Council approve Zoning Ordinance Amendment. No. 2017-03. Ivan Orozco .v Assistant Planner tO.jm M.TlanningCommisslon11505AutoMall 1ZOA2017-03.pc Exhibits 1. Vicinity Zoning and Aerial View 2. Site Plan 3. Site Photo 4. Sign Elevations 5. Ordinance 75A-8 Based on the analysis recommend that the City 911312017 ZOA-2017-03 5 South Auto Mall D G—�.%`�,;r}, ilii• � - Santa Ana Boundary' y ' '1250 fee[ Exhibit 1 e ; - -- n 2n14 niniral Man Protlllrr<. All rinht, rP<nrvad. http:l/maps.digitaimapcentral.com/production/DashboardIB/6/5/releasglyt Il/lgpWUcommands/printlhtmlprinUPdnlPreview.hlml# 7/1 ZOA NO. 2017-03 AMENDEMENTTO SPECIFIC DEVELOPMENT NO. 60 1505 SOUTH AUTO MALL DRIVE EXHIBIT 2 75A-10 ZOA NO. 2017-03 AMENDEMENTTO SPECIFIC DEVELOPMENT NO. 60 1505 SOUTH AUTO MALL DRIVE EXHIBIT 3 75A-11 WA As inti � j' ZOA NO. 2017-03 AMENDEMENTTO SPECIFIC DEVELOPMENT NO. 60 1505 SOUTH AUTO MALL DRIVE EXHIBIT 4 75A-12 I 35 �£ WA As inti � j' ZOA NO. 2017-03 AMENDEMENTTO SPECIFIC DEVELOPMENT NO. 60 1505 SOUTH AUTO MALL DRIVE EXHIBIT 4 75A-12 LS 925.17 ORDINANCE NO. NS -XXX AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA ANA APPROVING AN AMENDMENT TO PROVISIONS OF SPECIFIC DEVELOPMENT (SD) NO. 60; PERTAINING TO THE SANTA ANA AUTO MALL, RELATING TO THE SIGNAGE REQUIREMENTS THE CITY .COUNCIL OF THE CITY OF SANTA ANA DOES ORDAIN•,AS' FOLLOWS: 'Section 1. Th.e,City Councilof the City of Santa. Ana hereby finds,•deterrnines and declares as follows: .A. In a continuing effort to establish high-quality development' standards and to create a user friendly environment for the business community within the city, the. applicant is requesting that the existing .signage requirements for Specific: Development (SD):No. 60 be revised in order to construct a. new75-foot'tall full color electronic digital messeige'board.. B. After a :thorough analysis of the signage code requirements for Specific Development (SD) No. 60, -specifically Section 8 m (A) of the zoning docuent, staff identified the applicant's request to revise the allowed signage type, ,the maximum allowed height and maximum allowed sign face square footage for a pylon sign dedicated to the Santa 'Ana Auto Mall development site. The proposed changes to the allowed signage requirements for a pylon sign enable the City to implement a regulatory framework that both ,protects the health; safety, and welfare of the city and offers .alternative forms of business growth .and identification 'for business operators and o developers. Staff analyzed several projects With similar characteristics including physical construction of large pylon signs in automobile dealerships or other commercial uses that have already provided signage of this extent. In addition to allowing a taller and larger pylon sign, the applicant has also requested that the construction of the sign•allow for a full color digital electronic message displaysign. By making this change, staff guarantees that the proposed sign will meet all applicable development standards set forth`in the Specific Development No. 60. C. Section8 of Specific Development (SD) No. 60 describes•all signage types allowed and addresses the signage requirements for each type of sign. Currently the applicant is only requesting to modify Section 8(A)(1) through Section 8(A)(4) which state that a proposed electronic reader board pylon.sign can have a maximum height'of 70 feet and,a maximum"face area square footage of 835 square feet. The applicant has requested- that equestedthat signage requirements for a pylon sign consider the 'installation of an electronic full Ordinance No. NS -XXX EXHIBIT 5 Page 1 of 4 75A-13 color digital electronic message display sign and be allowed a maximum height of 75 feet with the face area square footage Maxim um. allowed being 1,200 square feet, In an effort to. provide a modem approach to signage and considering the recent remodeling of the majority of automobile dealerships within the Santa Ana Auto Mall, staff has also revised Section 8(A)(4) to be removed in its entirety. The last sub -section allowedfor individual dealerships to place •a'logo or manufacturer's product name on the solid,portion of the Pylon structure. The determination was made to remove such sub -section in order to guaranteethat a clean, sleek, and full color digital electronic message display sign will complete the look'forthe Auto Mall that proJides'an industrial, Modem style. D. On September 25, '2017 the Planning Commission 'held 'a. duly noticed ,public hearing on Zoning Ordinance Amendment 2017-03. E. The City Council has held,a noticed public hearing on this Ordinanceand has. considered all,testimony, presented .thereto: THE CITY COUNCIL OF THE CITY OF SANTA ANA DOES HEREBY ORDAIN AS FOLLOWS: Section 2: In orderto implement a regulatory framework that both protects the health, safety, and welfare of. the :city and promotes business growth for business operators and developers, Section 8 of the Specific• Development ,(SD) No..- 60 is hereby. amended such that it reads as follows: &&tion B. Signage Requirements. A. Electronic Reader-E3eaFd Pylon Sign.. 1. One full, color -digital electronic message display sign for the.Santa An Auto Mall shall be permitted along the Newooit-Costa Mesa Freeway (SR -55):, The sign shall be located on parcel 6 or parcel7 per Exhibit A. 2. The maximum'height of the readier board sign shall 6e 7- 0 75 feet •in , height: 3. The maximurri square footage.of the dig_ ital sign face shall be up Lo 9W 1:200.square feet. 4, Thliep s, the area feF. .. �.. a i a I h limit eitheF the registeFe4 lege er t , PFGd Gt .. QGIGFS utilized shall be the t ;31k�2-BF�126k. brd_ina_ nce _No.'NS-XXX Page 2 of 4 75A-14 Section 3. .In accordance with the California Environmental Quality Act (CEQA) the recommended action is .exempt from CEQA per•Section 15311. This exemption applies to accessory structures. The proposed sign ,is a direct replacement of an existing pylon sign which is located Just ten feet:south of the proposed ilocation. As the new sign will only be a replacement and is.part of a larger,auto mall development with no other building expansion being proposed, this accessory"structure will not result in a substantive change to the site. Categorical Exemption'No. ER 2017-107 will be filed for 'this' project. Section 4. If any section, subsection, sentence, clause, phrase or portion of this ordinance is for any reason held to be invalid or unconstitutional by the decision of anv court of competent jurisdiction, such.decision shall not affect the validity of :the remaining portions of this ordinance: The City 'Council of the City. of Santa Ana hereby declares that it. would have adopted this -ordinance and each section, ;subsection; sentence; clause phrase, or :portion thereof .irrespective ;of the, fact. 'that' _ any one or more sections, subsections, sentences_, .clauses, ,phrases, or portions, be .declared invalid or unconstitutional ADOPTED this: day of APPROVED AS TO. FORM:. Sonia R. Carvalho City-Attomey By: Lisa Storck Assistant Ciity-Attorney AYES`. NOES:'. ABSTAIN: NOT PRESENT: Councilmerribers Councilmembers.- Councilmembers ,Council members 2017. Miguei A: Pulido. Mayor 75A-15 Ordinance No. NS -XXX Page 3 of 4 CERTIFICATE.OF ATTESTATION AND ORIGINALITY I, MARIA D. HUIZAR, Clerk of the Council, do hereby attest to and certify that the attached Ordinance No. NS -XXX .to, be the original ordinance adopted by the City Council of the City of Santa Ana .on . and that said ordinance. was published in accordance with the Charter of the City of Santa Ana. .Date: Clerk• of the Council City of Santa Ana Ordinance No. NS -XXX Page..4 of 4 75A-16 LS 9.25.17 ORDINANCE NO. NS -XXX AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA ANA APPROVING AN AMENDMENT TO PROVISIONS OF SPECIFIC DEVELOPMENT (SD) NO. 60, PERTAINING TO THE SANTA ANA AUTO MALL RELATING TO THE SIGNAGE REQUIREMENTS THE CITY COUNCIL OF THE CITY OF SANTA ANA DOES ORDAIN AS FOLLOWS: Section 1. The City Council of the City of Santa Ana hereby finds, determines and declares as follows: A. In a continuing effort to establish high-quality development standards and to create a user friendly environment for the business community within the city, the applicant is requesting that the existing signage requirements for Specific Development (SD) No. 60 be revised in order to construct a new 75 -foot tall full color electronic digital message board. B. After a thorough analysis of the signage code requirements for Specific Development (SD) No. 60, specifically Section 8(A) of the zoning document, staff identified the applicant's request to revise the allowed signage type, the maximum allowed height and maximum allowed sign face square footage for a pylon sign dedicated to the Santa Ana Auto Mall development site. The proposed changes to the allowed signage requirements for a pylon sign enable the City to implement a regulatory framework that both protects the health, safety, and welfare of the city and offers alternative forms of business growth and identification for business operators and developers. Staff analyzed several projects with similar characteristics including physical construction of large pylon signs in automobile dealerships or other commercial uses that have already provided signage of this extent. In addition to allowing a taller and larger pylon sign, the applicant has also requested that the construction of the sign allow for a full color digital electronic message display sign. By making this change, staff guarantees that the proposed sign will meet all applicable development standards set forth in the Specific Development No. 60. C. Section 8 of Specific Development (SD) No. 60 describes all signage types allowed and addresses the signage requirements for each type of sign. Currently the applicant is only requesting to modify Section 8(A)(1) through Section 8(A)(4) which state that a proposed electronic reader board pylon sign can have a maximum height of 70 feet and a maximum face area square footage of 835 square feet. The applicant has requested that signage requirements for a pylon sign consider the installation of an electronic full Ordinance No. NS -XXX Page 1 of 4 Exhibit 8 75A-17 color digital electronic message display sign and be allowed a maximum height of 75 feet with the face area square footage maximum allowed being 1,200 square feet. In an effort to provide a modern approach to signage and considering the recent remodeling of the majority of automobile dealerships within the Santa Ana Auto Mall, staff has also revised Section 8(A)(4) to be removed in its entirety. The last sub -section allowed for individual dealerships to place a logo or manufacturer's product name on the solid portion of the pylon structure. The determination was made to remove such sub -section in order to guarantee that a clean, sleek, and full color digital electronic message display sign will complete the look for the Auto Mall that provides an industrial modem style. D. On September 25, 2017 the Planning Commission held a duly noticed public hearing on Zoning Ordinance Amendment 2017-03. E. The City Council has held a noticed public hearing on this Ordinance and has considered all testimony presented thereto. THE CITY COUNCIL OF THE CITY OF SANTA ANA DOES HEREBY ORDAIN AS FOLLOWS: Section 2: In order to implement a regulatory framework that both protects the health, safety, and welfare of the city and promotes business growth for business operators and developers, Section 8 of the Specific Development (SD) No. 60 is hereby amended such that it reads as follows: Section 8. Signage Requirements. A. Electronic Reader-SeaFd Pylon Sign. 1. One elPctrc^;c read-e-FbeaFd full color digital electronic message display sign for the Santa Ana Auto Mall shall be permitted along the Newpoft-Costa Mesa Freeway (SR -55). The sign shall be located on parcel 6 or parcel 7 per Exhibit A. 2. The maximum height of the reader board sign shall be 7&75 feet in height. 3. The maximum square footage of the digital sign face shall be up Lo 8351,200 square feet. 4. redYGt Y hl, Lq Ar ^I' bR. Ordinance No. NS -XXX Page 2 of 4 75A-18 Section 3. In accordance with the California Environmental Quality Act (CEQA) the recommended action is exempt from CEQA per Section 15311. This exemption applies to accessory structures. The proposed sign is a direct replacement of an existing pylon sign which is located just ten feet south of the proposed location. As the new sign will only be a replacement and is part of a larger auto mall development with no other building expansion being proposed, this accessory structure will not result in a substantive change to the site. Categorical Exemption No. ER 2017-107 will be filed for this project. Section 4. If any section, subsection, sentence, clause, phrase or portion of this ordinance is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this ordinance. The City Council of the City of Santa Ana hereby declares that it would have adopted this ordinance and each section, subsection, sentence, clause phrase or portion thereof irrespective of the fact that any one or more sections, subsections, sentences, clauses, phrases, or portions be declared invalid or unconstitutional. ADOPTED this day of 2017. Miguel A. Pulido Mayor APPROVED AS TO FORM: Sonia R. Carvalho City Attorney �¢ By: a `.EJ';i-- Lisa Storck Assistant City Attorney AYES: Councilmembers NOES: Councilmembers ABSTAIN: Councilmembers NOT PRESENT: Councilmembers Ordinance No. NS -XXX Page 3 of 4 75A-19 CERTIFICATE OF ATTESTATION AND ORIGINALITY I, MARIA D. HUIZAR, Clerk of the Council, do hereby attest to and certify that the attached Ordinance No. NS -XXX to be the original ordinance adopted by the City Council of the City of Santa Ana on , and that said ordinance was published in accordance with the Charter of the City of Santa Ana. Date: Clerk of the Council City of Santa Ana 75A-20 Ordinance No. NS -XXX Page 4 of 4 SALES TAX LOAN AGREEMENT This SALES TAX LOAN AGREEMENT ("Agreement") is made and entered into this day of November, 2017, by and between the Santa Ana Auto Mall Dealers Association, LLC, a California limited liability company ("Auto Mall"), and the City of Santa Ana, a charter city and municipal corporation organized and existing under the Constitution and laws of the State of California ("City"). RECITALS A. Sales tax assistance is an economic development tool used to encourage the development or upgrade of businesses that create additional sales tax for a City. The purpose of this Agreement is to help pay the costs of installing a new 75 -foot tall double face digital illuminated pylon sign at the Santa Ana Auto Mall located at 1505 South Auto Mall Drive. B. The City has maintained a long and successful relationship with the Auto Mall for almost forty years. During that time the Auto Mall has become a regional destination in purchasing and/or leasing vehicles. As a result of the successful business environment for the Auto Mall, it has been a high performing Sales Tax generator for the City. C. During the past five years, the Auto Mall has undergone extensive renovation of its facilities, which include modernization of the various components of the existing dealers for consumers as well as expansion of its inventory base. Also it has attracted new franchises / dealers to the Auto Mall expanding their vehicle selection. This recent investment has allowed the Auto Mall to remain competitive with other nearby dealers and has provided for future increase in the amount of vehicles to be sold/leased resulting in both higher revenue and greater sales tax for the City. D. In order to continue leveraging the investment of its dealers, the Auto Mall approached the City to assist with the purchase and installation of a new double face digital illuminated pylon sign at the Santa Ana Auto Mall ("Sign"). The Sign will have a total height of 75 feet and a maximum signable area of 1,200 square feet. The Sign will contain up -to date LED technology and disclose the various dealers in business at the Auto Mall along with the various incentives for prospective buyers. A true and correct copy of Auto Mall's initial request letter to the City is attached hereto as Exhibit A and incorporated herein by reference. E. The Sign will be utilized as the primary advertising medium for the Auto Mall, reaching approximately 250,000 vehicles a day traversing on the 55 freeway. The Sign will help provide an enhanced method of business identification and advertising and will contribute to the community and the City by advertising the Auto Mall regionally. The Auto Mall recognizes that the current sign is obsolete in nature and the new Sign will help ensure that the Auto Mall remains competitive to other automobile centers in the area. F. Electric Media, Inc. ("EMI") is the vendor designated by the Auto Mall to demolish the existing sign, and install the new Sign. The City's sole responsibility as part of this Agreement is to furnish payment to EMI on behalf of the Auto Mall. Subsequently, the Auto Mall will be responsible for the operation, maintenance and liability of the Sign. The total Sign costs will be $1,032,948.00. A true and correct copy of EMI's purchase order is attached herewith as Exhibit B and incorporated herein by reference. Exhibit C 75A-21 G. The Auto Mall will be responsible for repaying the Loan Amount to the City over 10 years. Each year the Auto Mall will receive credit for 50% of the new sales tax revenue generated to the City over the base year (calendar year 2016), which will be applied as a yearly repayment of the Loan Amount. At the end of 10 years of Loan Repayments, the remaining Loan Amount, if any, will be due and payable by the Auto Mall to the City. H. Additionally, the Auto Mail has agreed to provide the City access to space on the Sign for the purpose of marketing City sponsored events (e.g. Council or Commission or Special events). The programming would assist in increasing notification efforts of the public for City business and recreational events. NOW THEREFORE, in consideration of the mutual and respective promises, and subject to the terms and conditions hereinafter set forth, the parties agree as follows: DEFINED TERMS, The following terms when used in this Agreement shall have the meanings set forth below: "Base Year" shall mean January 1, 2016, through December 31, 2016. "Commencement Date" shall mean the date on which EMI completes the Sign installation, as set forth in a written notice from Auto Mall to the City. The parties anticipate that such work will take approximately 90-120 days to complete. "Contract Year" shall mean the period from January 1 to December 31 during each year of the Operating Period. For the purposes of this Agreement, the first Contract Year ends on December 31, 2018. "Covered Parties" shall mean the City and its elected and appointed boards, members, officials, officers, agents, representatives, employees and volunteers. "Effective Date" shall mean the date first written on page 1 of this Agreement. "Loan Amount" shall mean the amount paid by the City to EMI, on behalf of the Auto Mall, for the delivery and installation of a new 75 -foot tall double face digital illuminated pylon Sign at the Santa Ana Auto Mall, which shall not exceed $1,032,948.00, pursuant to the terms of the EMI purchase order attached hereto as Exhibit B, plus an interest rate of 0.92%, which is the California Local Agency Investment Fund ("LAIF") rate of return as of June 30, 2017. The interest rate (0.92%) will be applied to the remaining loan balance after the annual repayment on an annual basis. "Loan Repayment" shall mean the amounts to be credited by the City to the Auto Mall for repayment of the Loan Amount. The credit shall be calculated as 50% of the new sales tax revenue generated to the City by the Auto Mall over the base year. The base year shall be calendar year 2016, in which the City received $2,483,889.00 in sales tax revenue from the Auto Mall. The credits shall continue for 10 years from calendar year 2018 through calendar year 2027. At the end of the 10 years, the Auto Mall shall be responsible for payment of any remaining Loan Amount and accrued interest, if any, to the City. "Operating Period" shall mean the period commencing as of the Commencement Date, and continuing until and expiring after ten (10) years. 75A-22 "Required Operations" shall collectively refer to the following on and with respect to Auto Mall dealerships conducting automotive retail sales and service operations in the City: (i) Auto Mall shall have dealerships as its members which own or lease facilities in the City to allow the automotive retail sales and service operations to be conducted; and (ii) Auto Mall shall have dealerships as its members which operate automotive retail sales and service operations within the corporate boundaries of the City. "Sates Tax(es)" means that portion of taxes that is allocated, paid to, and actually received by City from the imposition of the Bradley -Burns Uniform Sales and Use Tax law (commencing with Section 7200 of the California Revenue and Taxation Code), or any successor law thereto, arising from all taxable sales transactions, occurring from Required Operations conducted by Auto Mall dealerships within the City during the Operating Period. "Sales Tax" shall not include sales tax revenues that are provided to a city based upon a special election and are limited to be used for a specified governmental function or functions. "Sales Tax Reports" shall include, for each Contract Year: (t) a statement identifying the amount of Sales Tax paid by Auto Mall dealerships from Required Operations within the City during the Contract Year; and, (ii) copies of all statements and reports filed with the State Board of Equalization. SALES TAX LOAN. 2.1 Loan Amount. On behalf of the Auto Mall, the City shall make payment to EMI in an amount not to exceed $1,032,948.00 ("Loan Amount") for the delivery and installation of a new 75 -foot tall double face digital illuminated pylon Sign at the Santa Ana Auto Mall, including the demolition and removal of the old sign, pursuant to the terms of the EMI purchase order attached hereto as Exhibit B. The City shall not be responsible for any other payments, expenses, or change orders beyond the Loan Amount. 2.1.1 Interest Rate. The Loan Amount shall include an Interest rate of 0.92°/x, which is the California Local Agency Investment Fund ("LAIF') rate of return as of June 30, 2017. 2.2 Repayment of Loan Amount to City. 2.2.1 Calculation of Auto Mall Consideration. The Auto Mall will be responsible for repaying the Loan Amount, including interest, to the City. Each Contract Year the Auto Mall will receive Loan Repayment credit for 50% of the new sales tax revenue generated to the City over the base year, which will be applied as a yearly repayment of the Loan Amount. The base year shall be calendar year 2016, in which the City received two -million, four -hundred and eighty-three thousand, and eight -hundred and eighty-nine dollars ($2,483,889.00) in sales tax revenue from the Auto Mall. At the end of 10 Contract Years of repayments, commencing with calendar year 2018 and continuing through calendar year 2027, the remaining Loan Amount not covered by the Loan Repayments, if any, will be due and payable by the Auto Mall to the City. 2.2.1.1 Subject to Paragraph 2.1.1.2 below, for Required Operations conducted by Auto Mall dealerships in the Operating Period, the Auto Mall shall receive Loan Repayment credit toward the Loan Amount based on the actual net amount of Sales Tax directly received by the City from the State Board of Equalization during that Contract Year. Subject to the terms of Section 2.1.2, the Loan Repayments for each Contract Year shall be 75A-23 applied to Loan Amount in a single calculation within ninety (90) days following the end of that Contract Year. 2.2.1.2 Loan Repayments shall be applied to the Loan Amount from any source of funds legally available to City. in this regard, it is understood and agreed that the Sales Tax from the Auto Mall's Required Operations in the City is being used merely as a measure of the amount of Loan Repayments that are periodically applied by the City to the Loan Amount, and that City does not and legally cannot pledge any portion of that Sales Tax to Auto Mall. 2.2.1.3 Once the City receives the sales tax from the Auto Mall, the entire amount of the sales tax revenue will remain with the City. No sales tax will be paid or credited back to the Auto Mall from the City as part of this Agreement. 2.2.1.4 City shall analyze the Loan Repayments after five (5) years, in November of 2022, and return to the City Council to provide an update on the sufficiency of the Loan Repayments and the remainder of the Loan Amount. 2.2.2 Repayment Procedure. 2.2.2.1 After the end of each Contract Year, and no later than one hundred and twenty (120) days after the Auto Mall dealerships' payment of the Sales Tax to the State Board of Equalization for that Contract Year, Auto Mall shall submit to City the Sales Tax Reports for the preceding Contract Year and a written request for application of the Loan Repayment amount for said Calendar Year to the Loan Amount. Any delay shall not constitute either a breach of this Agreement or a waiver of Auto Mall's right to receive Loan Repayment credit under this Agreement, but may result in a delay in the City's application of the Loan Repayment to the extent that such delay by Auto Mall causes the City to be unable to meet its obligations in a timely manner. 2.2.2.2 Calculation of the Loan Repayment amount determined by City to be credited to Auto Mall for each Contract Year shall be made by City within ninety (90) days after the later of the following: (i) Auto Mall's submission of its completed Loan Repayment request; and (ii) City's verification, based upon corroborating information provided to City by either the State Board of Equalization and/or a sales tax consultant retained by City, that City has received the Sales Tax attributable to sales from all Required Operations within the City for the applicable Contract Year. Any disapproval by City of an Auto Mall Loan Repayment request shall state in writing the reasons for disapproval and shall be provided to Auto Mall within fifteen (15) days after City has received information necessary to make the determination that the Loan Repayment request cannot be approved. City agrees to expeditiously process Auto Mall's requests for Loan Repayment. Auto Mall expressly understands that nothing contained in this Agreement shall obligate or otherwise commit City to apply the Loan Repayment for a Contract Year unless and until City receives reasonably satisfactory verification that City has received the Sales Tax attributable to sales from the Required Operations in the City for that Contract Year. 2.2.2.3 In the event that the State Board of Equalization conducts a review or audit of Auto Mall's Required Operations or Sales Tax payments during the Operating Period that results in an actual and final loss or reduction of monies that City has already applied to the Loan Repayment for one or more Contract Years, or in the event that Auto Mall amends any sales tax returns that causes a reduction in the Sales Tax due to the City for one or more Contract Years, the City shall recalculate the Loan Repayment accordingly. In the event that the State Board of Equalization conducts a review or audit of Auto Mall's Required Operations or 4 75A-24 Sales Tax payments during the Operating Period that results in an increase of Sales Tax that Auto Mall must pay for one or more Contract Years, or in the event that Auto Mall amends any sales tax returns that causes an increase in the Sales Tax due for one of more Contract Years, Auto Mall shall inform the City and the City shall commensurately increase the Loan Repayment credited to Auto Mall. The provisions of this paragraph shall survive the termination of this Agreement. 2.2.2.4 The parties acknowledge that certain payments of Sales Tax received by City may be based on estimates and that such amounts will be periodically reduced or increased by the State Board of Equalization to reflect the actual amount of Sales Tax owed to City. The Loan Repayments shall be adjusted accordingly as necessary to conform to such reconciliations. The adjustment shall be made within sixty (60) days through any necessary recalculation. Within thirty (30) days of a written request by Auto Mall, the City shall provide Auto Mall with documentation to substantiate the adjustment of the Loan Repayment(s). 2.2.2.5 Within ninety (90) days following the end of each Contract Year, the City may conduct an accounting of all of Auto Mall's Sales Tax Reports and Sales Tax payments during the immediately preceding Contract Year, and the amount of the Loan Repayments applied to Auto Mall during that immediately preceding calendar year. However, the City may also conduct such an accounting at any time by giving thirty (30) days written notice in the event that facts or circumstances arise, such as change in operations, change of ownership or business entity status, which can impact the method or amount of Auto Mall's Sales Tax Reporting or Payments. The City shall provide Auto Mall a copy of that accounting and reconciliation upon its completion. In the event that the accounting and reconciliation identifies a disparity between the Required Operations, Auto Mall's Sales Tax payments, or Loan Repayments during that immediately preceding calendar year, appropriate adjustments shall be made within sixty (60) days. 2.2.3 No Acceleration. It is acknowledged by the parties that any Loan Repayments by City provided for in this Agreement may only be applied for those periods in which City receives the performance of Auto Mall pursuant to this Agreement. Therefore, the failure of City to apply any Loan Repayments or the failure by City to perform any of its other obligations hereunder shall not cause the acceleration of any anticipated future Loan Repayments by City. 2.3 Conditions Precedent to City's Obligations. City's obligation to perform hereunder, including without limitation its obligation to apply the Loan Repayment pursuant to Section 2.1 of this Agreement, shall be contingent and conditional upon Auto Mall's full and satisfactory performance of its obligations set forth in this Agreement. Notwithstanding the foregoing, any delay by Auto Mall in sending reports or other information to the City, or the existence of inadvertent errors in reports or information sent by Auto Mall to the City, shall not constitute either a breach of this Agreement or a waiver of Auto Mall's right to receive credit for the Loan Repayments under this Agreement. However, such delay or error by Auto Mall may result in a delay in the City's calculation of Loan Repayments to the extent that such delay or error by Auto Mall causes the City to be unable to meet its obligations on a timely basis. 2.4 Disclosure of Payments. Auto Mall agrees that the calculation of Loan Repayments and the amounts thereof do not constitute a violation of Revenue and Taxation Code Section 7056 or any other provision of law pertaining to the disclosure of sales tax information, shall be a matter of public record, may be disclosed to any person, and may be included on the City's warrant register. Auto Mall waives any law that is contrary to any of the agreements in this Section 2.4. 75A-25 2.5 City Facilitation of Site Improvements. The City shall take commercially reasonable steps to expedite the review and processing of building permits, certificates of occupancy and final instruction, and other permits, approvals and entitlements needed by Auto Mall in connection with the installation of the Sign. AUTO MALL OBLIGATIONS. 3.1 Operating Agreement Continuous Operation. The Auto Mall hereby covenants and agrees to continuously conduct or cause to be conducted Required Operations within the City during the entire Operating Period. Such continuous operations shall be subject to the force majeure provisions of Section 5.11 hereof. Notwithstanding any provision of this Agreement to the contrary, nothing contained herein shall restrict or prevent any member of the Auto Mall from closing or relocating its dealership or transferring or selling its dealership property or business. Further, provided, that any such closing, relocation, transfer or sale shall not constitute an event of default under this Agreement provided that at least one automotive dealership that is a member of the Auto Mall continues to perform the Required Operations. 3.2 Maximization of Sales Tax. At all times during the Operating Period, the Auto Mall shall designate its dealerships and sales offices in the City as the point of sale for sales and use tax purposes in all automotive retail sales and service operations that originate from within the City. 3.3 Payment of Taxes. The Auto Mall dealers shall pay or cause to be paid any and all taxes applicable to or arising out of the lease, operation and/or use of its dealerships and sales offices in the City, including, without limitation, all taxes attributable to sales occurring at such offices, except that the Auto Mall dealers retain the right to protest and contest County of Orange decisions related to the value of its interest in any property or leasehold. The Auto Mall dealers shall make or cause to be made timely sales and use tax payments to the State Board of Equalization, except that the Auto Mall dealers retain the right to protest and contest State Board of Equalization assessments or decisions that it believes to be erroneous. 3.4 Compliance with Laws. Subject to the Auto Mall dealers' right to contest same, the Auto Mall dealers shall conduct or cause to be conducted all activities within the City and shall perform its obligations under this Agreement in conformity with all applicable federal, state, and local laws, ordinances, and regulations. Nothing in this Agreement is a representation or warranty by City that any construction work performed by EMI within the City on or after the date of this Agreement is not a public work as defined in Labor Code Sections 1720, et seq., including but not limited to Sections 1771 and 1781. 3.5 Title and Ownership of Sion. The Auto Mall shall own and take full responsibility for the operation and maintenance of the Sign. City acknowledges and agrees that title to the Sign shall be vested exclusively in the Auto Mall immediately upon City's payment to EMI in the amount set forth in Recital F. Upon City's payment to EMI, City will cooperate with Auto Mall regarding any documents that may be reasonably necessary in order to vest title to the Sign with the Auto Mall. 3.6 City Time on Sign. The Auto Mall shall provide the City access to digital space on the Sign for the purpose of marketing City sponsored events (e.g. Council or Commission or Special events). The Auto Mall shall dedicate 10% of its advertising time on the Sign (e.g. six minutes per hour) to City sponsored events provided by the City. The provisions of this paragraph shall survive the termination of this Agreement. 75A-26 4. TERM. 4.1 This Agreement shall commence on the Commencement Date and terminate on March 31, 2028, unless terminated earlier in accordance with Section 5, below. The Term of this Agreement may be extended for the purpose of completing final calculations only, if necessary, upon a writing approved and executed by the City Manager, City Attorney, and the representative for the Auto Mall. 5. TERMINATION RIGHTS. 5.1 City Termination Rights. Subject to the force majeure provisions of Section 6.12 below, Cityshall have the right to terminate this Agreement if, following the Commencement Date, Required Operations are not conducted within the City by at least one dealership who is a member of the Auto Mall for a period of ninety (90) consecutive days. If the City terminates the Agreement pursuant to this Section 5. 1, any remaining balance of the Loan Amount and accrued interest shall be immediately due and payable from the Auto Mall to the City. 5.2 Auto Mall Termination Rights. Auto Mall may terminate this Agreement for any reason, or no reason, upon one hundred and eighty (180) days written notice to the City, at which point, any remaining balance of the Loan Amount and accrued interest shall be immediately due and payable from the Auto Mall to the City. 5.3 Mutual Termination Rights. City makes no representation or warranty to Auto Mall as to the legality of the Loan Repayments or the City's authority to make such Loan Repayments. In the event that a final, non -appealable judgment or decree is rendered against City invalidating its Loan Repayment obligations set forth in this Agreement, either City or Auto Mall may terminate this Agreement by delivery of written notice of termination to the other party, and any remaining balance of the Loan Amount and accrued interest shall be immediately due and payable from the Auto Mall to the City. 6. GENERAL PROVISIONS. 6.1 Incorporation of Recitals. The recitals to this Agreement are deemed by the parties to be true and correct and are hereby incorporated into the Agreement by this reference. 6.2 Entire Agreement. and Amendments. This Agreement incorporates all of the terms and conditions mentioned herein, or incidental hereto, and supersedes all negotiations and previous agreements between the parties with respect to the subject matter hereof. Any amendment or modification to this Agreement must be in writing and executed by Auto Mall and City. 6.3 Limitations on City's Liability. Auto Mall and City acknowledge and agree that: 6.3.1 The relationship between Auto Mall and City pursuant to this Agreement is and shall remain solely that of contracting parties, and City and Auto Mall neither undertakes nor assumes any responsibility pursuant to this Agreement to review, inspect, supervise, approve, or Inform the other party of any matter in connection with this Agreement or the Required Operations, except as required by the terms of this Agreement; 6.3.2 City shall not be directly or indirectly liable or responsible for any loss or injury of any kind to any person or property, except to the extent proximately caused by 75A-27 City's active negligence or intentional misconduct, resulting or in any way arising from: (a) any defect in any building, grading, landscaping, or other onsite or offsite improvement; (b) any act or omission of Auto Mall or any of Auto Mall's agents, employees, independent contractors, licensees, sub lessees or invitees; or (c) any accident at the Auto Mall facility, or any fire or other casualty or hazard thereon; and 6.3.3 By accepting or approving anything required to be performed or given to City under this Agreement, City shall not be deemed to have warranted or represented the sufficiency or legal effect of the same, and no such acceptance or approval shall constitute a warranty or representation by City to anyone. 6.4 Interpretation: Governing Law; Venue. This Agreement shall be construed according to its fair meaning and as if prepared by both parties hereto. This Agreement shall be construed in accordance with the laws of the State of California, without regard to conflict of law principles. All legal actions must be instituted and maintained in the Superior Court of the County of Orange, State of California, or in any other appropriate court in that County. 6.5 Severability. If any term, provision, agreement, or condition of this Agreement is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remainder of this Agreement shall not be affected thereby to the extent such remaining provisions are not rendered impractical to perform taking into consideration the purposes of this Agreement. 6.6 Binding Effect Successors and Assigns. This Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. 6.7 Notices. All notices and other communication required under this Agreement shall be in writing and shall be delivered by either: (i) personal delivery, (ii) reliable courier service that provides a receipt showing date and time of delivery, (iii) registered or certified U.S. Mail, postage prepaid, return receipt requested, or (iv) facsimile. Notices shall be addressed to the respective parties as set forth below or to such other address and to such other persons as the parties may hereafter designate by written notice to the other party hereto: To City: City of Santa Ana 20 Civic Center Plaza P.O. Box 1988 Santa Ana, CA 92702 Attn: City Manager Facsimile: (714) 647-6954 To Auto Mall: Santa Ana Auto Mall Dealers Association, LLC c/o Premier Property Management 25108 Marguerite Parkway #A-262 Mission Viejo, CA 92692 Email: emilybenedick@gmail.com Each notice shall be deemed delivered on the date delivered if by personal delivery or by overnight courier service, on the date of receipt as disclosed on the return receipt if by mail, or on the date of transmission with confirmed successful transmission and receipt if by facsimile. By giving to the other party written notice as provided above, the parties to this Agreement shall have 75A-28 the right from time to time, and at any time during the term of this Agreement, to change their respective addresses or contact persons. 6.8 Representations and Warranties. As a material inducement to City's entry into this Agreement, Auto Mall represents and warrants to City that (i) Auto Mall has the full power and authority to enter into and perform under this Agreement; and (ii) all authorizations and approvals required to make this Agreement binding upon Auto Mall have been duly obtained. As a material inducement to Auto Mall's entry into this Agreement, City represents and warrants to Auto Mall that, subject to and limited by the provisions of Section 5.2: (i) City has the full power and authority to enter into and perform under this Agreement; and, (ii) all authorizations and approvals required to make this Agreement binding upon City have been duly obtained. 6.9 Litigation Expenses. If either of the parties institutes any legal action against the other in connection with any controversy related to, concerning or arising out of this Agreement, or any facts based upon or involving this Agreement, then the prevailing party, whether in court, through mediation, arbitration or by way of out-of-court settlement, shall be entitled to recover from the non -prevailing party such prevailing party's reasonable attorneys' fees, court costs, expert witness fees and other expenses relating to such controversy, including such fees, costs and expenses on appeal, if any; and the arbitrator(s), if any, is hereby authorized to make such an award to the prevailing party in arbitration. 6.10 Termination. In the event this Agreement terminates, no termination shall release any party in default and this Agreement shall survive for purposes of allowing a party to enforce its rights and remedies under this Agreement in the event of a default. All indemnification provisions and any other provision that by its nature cannot be performed during the term of this Agreement shall survive the termination of this Agreement. 6.11 Defense of Third Party Claims. To the fullest extent permitted by law, Auto Mall shall indemnify, defend and hold harmless the City, its officers, agents, and employees from and against any and all losses, liabilities, damages, costs and expenses, including attorney's fees and costs in the event that a third party files litigation challenging the validity or enforceability of this Agreement, or any Loan Repayments. The City and Auto Mall may jointly defend the Agreement and/or Loan Repayments. The Auto Mall's obligation to defend, hold harmless and indemnify is contingent on the City cooperating in the defense of the action throughout the litigation, and entering into a mutually agreeable Joint Defense Agreement, although the Auto Mall will be responsible for any and all costs and fees related to any such defense. 6.12 Force Majeure. The obligations by either party hereunder shall not be deemed in default and times for performance hereunder shall be extended where delays are caused by fire/casualty losses; strikes, riots or war; litigation; unusually severe weather; inability to secure necessary labor, materials or tools because of a shortage in the market; delays of any contractor, subcontractor or supplier; unjustified acts or failure to act by City in the processing or approval of plans or permits or inspection or approvals of improvements; acts of God, or other similar causes without the fault and beyond the reasonable control of the party, despite the party's diligent efforts (collectively, "force majeure"), if written notice is provided to the other party within a reasonable period following commencement of any such circumstances and, provided further; that the extension of time shall be only for the period of the force majeure delay. Adverse market conditions or the inability to obtain financing shall not constitute an event of force majeure. 75A-29 6.13 Counterparts. This Agreement may be executed in two or more counterparts, each of which when so executed and delivered shall be deemed an original and all of which, when taken together, shall constitute one and the same instrument. 10 75A-30 IN WITNESS WHEREOF, the parties hereto have executed this Agreement the date and year first above written. ATTEST: CITY OF SANTA ANA MARIA D. HUIZAR Clerk of the Council Raul ManGodager 11 g City Manager APPROVED AS TO FORM: SONIA City AA By: IL Ryan O. RECOMMENDED FOR APPROVAL: FRANCISCO GUTIERREZ Executive Director Finance and Management Services 75A-31 SANTA ANA AUTO MALL DEALERS ASSOCIATION, LLC Jim Speck Volvo of Orange County George Raysik — Secretary and Treasurer PAG Santa Ana B1, LLC d/b/a Crevier BMW George Raysik— Secretary and Treasurer PAG Santa Ana AVW, Inc. d/b/a Audi South Coast George Raysik— Secretary and Treasurer PAG Orange County S1, Inc. d/b/a Subaru Orange Coast 12 Derrick Van Nieulande Freeway Honda George Raysik— Secretary and Treasurer PAG Santa Ana B1, LLC d/b/a Crevier Mini George Raysik— Secretary and Treasurer PAG Santa Ana AVW, Inc. d/b/a Volkswagen South Coast George Raysik— Secretary and Treasurer PAG Orange County L1, Inc, d/b/a Lincoln South Coast 75A-32 EXHIBIT A Santa Ana Auto Mall Dealers Association Initial Request Letter 13 75A-33 SANTA AN, {A AUTO MALL DEALERS ASSOCIATi TON; LLC C!0 Premier Property Management ♦ 25108 Marguerite Parkway #A-2621 Mission Viejo, CA 92692 0: 949.837.2701 D: 714.348.0002 E: emilybenedick@gmail.com August 28, 2017 City Council City of Santa Ana 20 Civic Center Plaza Santa Ana, CA 92701 RE: Santa Ana Auto Mall Freeway Sign Upgrade for Increased Revenue Dear Honorable Mayor and City Council Members, The Santa Ana Dealers Association (SADA) is hereby requesting the City's assistance in a Sales Tax Participation Agreement to upgrade the electronic freeway sign that is used as the Auto Center's main advertising medium to reach the 250,000 cars/day that drive on the 55 freeway. It is near Impossible to convey to the public driving by on the freeway, that the Santa Ana Auto Mall encompasses 35+ acres of different Auto Dealerships without an Impactful electronic freeway sign that has up-to-date technology. The assistance needed from the City of Santa Ana for this project Is an upfront funding of $1,032,948 (100% of project cost) In order to capitalize on the 11 %-13% average sales increase for a sign upgrade of this size. This sales increase will result in a sales tax revenue increase of the same proportion to the City; this will allow the City to recoup their costs in 12 years or less. If the total amount of is not recouped by year 12, the SADA will pay the remaining balance to the City. Note: final terms of agreement to be finalized and approved by SADA and the City of Santa Ana. The recoup structure breakdown Is as follows: ➢ Total Remitted Sales Tax 2016 (approx.): $3,000,000 ➢ 12% Increase Estimate on 2018 (approx,): $360,000 ➢ 50% of that Increase Goes To City: $180,000 ➢ Recoup Time: approx. 6 years $1,080,000 SADA agrees to guarantee that any shortage not paid back to the City from Increased sales tax at the end of the term, shall be paid by the Dealers Association. With this mutual investment, the SADA will be able to make their sign a landmark and will be able to capture more of the Orange County market share from other Cities who also have digital Auto Center signs such as: Tustin, Irvine, Anaheim, Huntington Beach, Westminster and Garden Grove. In order to capture the above market share as soon as possible, please support our request and schedule the SADA project for a Planning Commission meeting to vote on approval by the last meeting In September 2017. Regards, Santa Ana Auto Mall Dealers Association EXHIBIT C 75A-34 SANTA ANAAUTO MALL DEALERS ASSOCIATION LLC C10E:[emierproPertyM�egmnenfi2 Joaftgm petAwayRA282iWS*nM40,CAW92 0:948.N72TOf 0:714.348.M �emryhenedidn�pmimm Crevier BMW (Penske) Penske Lincoln South Coast Penske Audi South Coast Frea X —D m mdn -' Crevier Mlni (Penske) Penske Volkswagen South Coast x.. x _ ce n liwbz—� Volvo of Orange County Jfm Spac4 75A-35 EXHIBIT B Electra -Media, Inc. Purchase Order 14 75A-36 EMI ELECTRA-MEDIA, INC. ustomer E.Oylpmenl Address: Sante Ana Aola Dcalen ASfOC,a:iOP 55 Freeacy 1505 Auto Mall Dave Santo Ana. CA 92705 I/V/e hereby order_ for purchase under the terms and conditions of this agreement, incorperated herein by reference, the following pmducl(s) 20MM RESOLUTION — YESCO SIGN INSTALLATION Product Dwell n: Remove ealire existing 70' Santa Ana Auto 61011 sign Cul existing pipes lull bolaw grade, cap and pave over. Fabricate and iretall new 75' double tow pylon sign, ute ing fooling and steel pip-, wah Mo (2) no.. single face, full color Pdutsvia-V'd LED displays 1304 pixels high by 70; p�xCs .villa - 20MM Resclueom) v ilb metal on nolo of sign lemdng back, top and bottom open lur an open V siructmo'modern' appearance. Encs pixel to be comprised Of premium diodes lied, blue and green) of the highest quality Each pixel to be shaded by a conastonl linear lommy. Display to hoo-e night.iime dimming mpobiihy to 1% of full brightness, still maintaining 100% of the color spectrum. The LED circuit boards and modules to be confameal mated, and enclosed in a sealed. ..roer.11910 enclosure. All electrical components are to be wired into central distribution panel whtds then will connect to existing primory disconnects. YESCO and EMI technicians will Complete all wiring, lum-on and tell display. Also includes lime and temperature, two (2) remote computers In marquee, aotort is dimming circuit, modem and ventilation system Manufacture and install lo (2) new single lace lop ID calinab 5' s 48' 2.5' and install onto steel pipes will, intervally illuminated (.1m while LEDs) black channel letters that and 'Santa Ana A.L. Moil' Includes two (2) I'8' a 48' 2.5' painted silver aluminum decorative bonds Installed below LED cabinets and two 12) 1'6' s 45'10' painted blue aluminum decoralive bonds installed below aluminum decorative bonds. Fabricate and install custom .090 aluminum Pole weer will, lermte finish, includes Yl' s 46'6' radius painted alumina, edge sa-fion and install ever structural steel. See Etdi! yESCO Design #803367-1L Note: All fabrication, installation and permits to be performed by California Licensed Contractor -Young Electric Sign Company- (YESCO), State Contractors License C-45 #250739 and EMI State Contractors License C-45 0815508. EMI Maintenance Centrad: Includes all parts, labor and crane labor for five 151 years for monthly service to change out LED malulm, power supplies, interface cards, line dOxii OVI cards, transformers, fuses, rectifier boards, modem, controllers, S.fl.am, etc., i wah prevantative maintenance calls once per month over and abo+e emergency wa„kend calls. Also inclad,n pads and labor for servicing illuminated rdentilicofon displays, including LEDs, ballasts and transiormom. EMI Programming Contract: Includes ail programming services for live (5) ..is which consists of <fail, updates, ank iled changes, videa gt ie transfer. Int,,mcl downloads, a.mail confirmafons, holiday graphics, and weekly frame rviews- Aho includes our pro tcGva E6Il Ieam periodically r(Mewing sign content to ers.ro that messages Stay up to dale. Doliverv: 90.120 days from dote permits are obbind and down puymenl is receieed Electrical. Phone & Web Cams: Rause existing alearicnl and apgrmfo communications In Ve,aan Conular as included m price Lei—, Valuer solli xs foe of S60/mo. to li billed separately by EMI. Also includes two (2) web comers, one pm face, and monitoring service 124 hours a day, 7 days o wooL, viewed avary hew will amotl notifications upon risers to EMI and Santa Amo Deale,s Association) for one vmr. Add,tlanal mw imring .ill be available so ansiol, fharmher for S 150/ma. ra be paid bt Dealers Assecimr.r. CiN EundIng 8' Pe,'milt, Includes morrdlna6roshsg ng and procCity Funding Agreement grid Co, permit Le: Actual cost of City application fees. inspttlon welding fees, structural eng:neeMg, soil report lees. acquisition Inbar and final building permit fees are to be billed sapomlely. Soil: Does not include installation m mralmil sea cendifions (if applicable). Note: If high -alar tahle c-xin1s, stool casings may be needd Contingency: Agreement contingent upon EMI and Deafsn Association obtaining 100% lunding hon the Cil, of Santa Are tfuough o $ales lux participation cg,cemant with final payment terms and conditions of funding agreement being appro*eri by Santa Arm Auto Mall Deah,m AssvAtion EMI to uss;st in coordinating the Cp funding process and provide sampf. Iunding aq,,,ts encs used recently at other cities Prevailing Wage: Price based on prevailing .age for orrnte labor. Price Eampmant 6 Labor 51.032,948.00 Applicable Tax. Included Total Will, Tax S1,032,9E8 00 Payment Terms i 3.1.316.00 Darn Posmmm Upon Signing 5 344,316.00 Upon Shiprnem of LEDs S 344,31600 Upan Completion II I WITNESS (`:HEREOF, Owner and FMi have nsadd flys agreuumm flys I_' day of Septomber. 2017 Qmu": Sona Ara Auto Deolen Associrtien 1505 Auto bioll Drive 5 mea Ana, CA 92705 gy.. .. - ooh lira pets. Elocu. Mndfa, Inc 4'371.'.' 156' Snit La.odale.'CA 90260 fig ./�-, - - . �R ,Wilson Dale 0101 l FIF EXHIBIT D 75A-37 75A-38 SANTA ANA AUTO MALL DEALERS ASSOCIATION ION LLC CIO Premier Properly Management ♦ 25108 Marguerite Parkway #A-262 ♦ Mission Viejo, CA 92692 0: 949.837.2701 D: 714.348.0002 E: emJybenedlck@gmail.com August 28, 2017 City Council City of Santa Ana 20 Civic Center Plaza Santa Ana, CA 92701 RE: Santa Ana Auto Mall Freeway Sign Upgrade for Increased Revenue Dear Honorable Mayor and City Council Members, The Santa Ana Dealers Association (SADA) is hereby requesting the City's assistance in a Sales Tax Participation Agreement to upgrade the electronic freeway sign that is used as the Auto Center's main advertising medium to reach the 250,000 cars/day that drive on the 55 freeway. It is near impossible to convey to the public driving by on the freeway, that the Santa Ana Auto Mall encompasses 35+ acres of different Auto Dealerships without an impactful electronic freeway sign that has up-to-date technology. The assistance needed from the City of Santa Ana for this project is an upfront funding of $1,032,948 (100% of project cost) in order to capitalize on the 11%-13% average sales increase for a sign upgrade of this size. This sales Increase will result in a sales tax revenue increase of the same proportion to the City; this will allow the City to recoup their costs in 12 years or less. If the total amount of is not recouped by year 12, the SADA will pay the remaining balance to the City. Note: final terms of agreement to be finalized and approved by SADA and the City of Santa Ana. The recoup structure breakdown is as follows: ➢ Total Remitted Sales Tax 2016 (approx.): $3,000,000 ➢ 12% Increase Estimate on 2018 (approx.): $360,000 ➢ 50% of that Increase Goes To City: $180,000 ➢ Recoup Time: approx. 6 years $1,080,000 SADA agrees to guarantee that any shortage not paid back to the City from increased sales tax at the end of the term, shall be paid by the Dealers Association. With this mutual Investment, the SADA will be able to make their sign a landmark and will be able to capture more of the Orange County market share from other Cities who also have digital Auto Center signs such as: Tustin, Irvine, Anaheim, Huntington Beach, Westminster and Garden Grove. In order to capture the above market share as soon as possible, please support our request and schedule the SADA project for a Planning Commission meeting to vote on approval by the last meeting in September 2017. Regards, Santa Ana Auto Mall Dealers Association EXHIBIT 75A-39 SANTA ANA AUTO MALL DEALERS ASSOCIATION LLC CFOPremier MP6dYM2ne9"nt♦26108Mer6aeftPmk*q#A-282#WIOWO,CA 62662 0:81flW2101 0,14.3aWIQ E:emYwmdd4NmWLccm Crevier BMW (Penske) Penske Lincoln South Coast X-, x._! Crevier Mini (Penske) Penske Volkswagen South Coast K iQ _ x Volvo of Orange County 75A-40 EMI ELECTRA-MEDIA, INC. customer E,qupment Addrau: San,. Ana Auto Dsaien Assoc,onoo 55 Freeway 1505 Auto Mali Duvc Sam. Ann. CA 92705 1/We hereby order for purchase under the terms and conditions of this agreement, incorporated herein by reference, she lollowmg pmduct(s) 20MM RESOLUTION — YESCO SIGN INSTALLATION Product Description: Re.ve entire existing 70' Santa Ano Auto Mall sign. Cut evsnng apes just below grade. cap and pave over FnOricare and .nstn1l ne. 75double face pylon sign, ncludng louring and steel papa, .cath two (2) n,, sAg1A face, full tato. PAs nwmw V'd LED displays 1304 piu s, high by 704 pueu w¢ie 20MM Resolution) with metal on nose of sign having back, top and banom open lar an open V gructvwo'mori oppenrance Each pixel to be Comprised n) internam diodes (red, blue and green) of the highest yutilit, Each pival 1. be shaded by a convslenl linear louver Display to hose nighl4.me dimming capability ro 1% of lull brightness, 61.11 maintaining 100% of the color spKeum The LED ci cult bounds and modules to be mnlormol cooled, and enclosed m a sealed. .aeotight enclosure. All electrical components are In be carred into central dis:nhutan pane! which then will connect to unsung pfimary dlsconnerls. YESCO one EMI technicians will complete all wiring, lum.an and !eel display Also mcladea time and !emperatuee, two (2) romoto computers In marquee, m,omnac dimming circui!, modem and +entWiAn ryste-o Manu&tdure and ins,.11 two (21 ne» single face or, ID cabinets 3'5' s 48' 2.5' and lash11 area steel pipes with ,memclly d o rnn. ed (with while LEDs) bloat channel letters the, reed 'Sorb Ana Arlo MAID Includes two (2) 1'8' a 48' 2.5' pmmed silver afomirwm decomlae brads metalled below, LED cabinets and two (2) 1'6' 1 45'T0' palmed blue aluminum decorative bonds installed below aluminum decorative bands. fabocma and Asia)) cusmm ,090 clummum pole cover, wah to,,we lunch, includes 2'l ' s 46'6' radius pointed aluminum edge section and install over etruearol steel. See Eh111 yESCO Design >803367-11 NNote: All fabrication, Installation and permits to be performed by California Lkensod Contractor "Young Electric Sign Company" (YESCO), State Contraction Liconse C-45 0250739 and EMI State Contractors License C-05 0!815508. EMI Maintenance Contract: Includes all porn, labor and crane labor for live (5) yeen lot montFlr service to change out LED modules, pawer sumttom, interface curds, line drivws, DVI cards, tmnsformen, fuses, rectifier boards. modem, cooudlen. sohwe,e, etc., along wish preventative maintenance calls onto incl month over and bawe emergency wrekend calls. Also includm pans and labor lar servicing itlummmed .dani,f<ofon displms, mdudmg LEDs, ballasts and twnsformess. EMI Psoarammfna Contract: Includes all programming services fon live (5) yeah which consists of daily updates. unli.,I d changes, v,da4 graphic tansies, bdemel downloods, ..mail confirmations, holiday graphics. and weekly frorne rwtews. ;deo mclu&S our puma,+e EMI Team prmoda(1lly ra+aw.ag sign come t to ensom thot messages stay ep to date. Delhie : 90 .120 dory hom dote pennns esu obtained and auwn p.ymem a rsxasvud Electrical, Phone & Web Cams: Red" esisting alacvicol and upgrade cinntmgnma.an, to Venice, C.Vula, as mdudad .n price below Veracn servo- Ire of W/mo to be billed separately by EMI. Also includes n.o 12) web cameras. one pct loce, and monaoring serrata 124 hours o day. ? days a work. wowed esery hour yob emoil nouFcarusns upon eaors Io EMI and Sent. Ann Dealws Assocnriarl in, one year Add. crl.t mn t dog will be Available s.paolcl, thedoffle, for $15D/mo. As be paid by Dealers Astaci.6on tlN Fuadi"a 8 Per min:. Includes coordinating and processing Cil, Fumifig Ag,eemnm and City perm, Nota. Actual call of City appl,cc non Ices, msec +ion +cos, welding Ices, sounswal anginearing, soil ropon leen, acit,00o, lobar and final building pernm leas arc to it billed sapamlelr Soil: Dees nal indudv. muaholiam in abnormal sal conditions (if oppl,wble.). Note: 11 high wore, sable ausb, st_ei casings may be needed Cont naon<v: Agreement contingent upon EMI and Dealer, Association obtaining 100% landing from the City of Santa Ana through 0 soles In. purocryohn, agreomont with final payment toms and condilions al Funding ag,eemenl beteg approved by Santo Ann Asda Mull D:atea Aasa'iolion EMI to assssl in coordinating the City funding process and provide sample funding agnsemena Ano recentf, at other ones Prevailing Wage: Price based on prevailing wage for on-site labor Price E.mpm,tm 6 Laba- Applicable Tac S 1.032 948 00 Included Payment Terns S 344,51600 Dean Pnymn•nl Upon Stu n.,.g S 344.31600 Upon Shipment of LEDs Total Wilk Tor $1,032,948 00 S 344,316 00 Upon Camhlan.a ,N WITNESS s%HEREOF. Gane, nod EMI have nuocuid this agreemnm this Ila day of September. 2017 Gw_nc,' Sento Ana Auto Dealers Association 1505 Auto Mel Dnvp FAAO. CA 927058 Duro Elea,n Meda, in, 4737 'n, 156' Snord Lawndde. CA 90260 _ /i 9- /y 8r jgff l /i Orae OI O) t1 EXHIBIT E 75A-41 75A-42