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EXHIBIT 1 29, 2019 ZTO: Steven Mendoza 0 Executive Director Community Development Agency z 20 Civic Center Plaza, M-25 O Santa Ana, CA 92702 LL CC: Marc Morley Economic Development Specialist City of Santa Ana Dear Mr. Mendoza and Mr. Morley, Thank you for considering our proposal to restore the historic YMCA building into the dynamic and community - focused OCSA Design & Arts Community Center, in partnership with The Wooden Floor and Relampago del Cielo. It is our intention to convert the iconic building into a thriving hub for arts, connection, and community. The new, state-of-the-art facility would provide an opportunity for OCSA to: • enroll an additional 300 students annually, • expand its arts conservatory programs to fit the changing economic landscape, • offer enriched community programs for local residents, • grow meaningful partnerships with and permanent expansion facilities for The Wooden Floor and Relampago del Cielo, • cultivate involvement of tech giants (Google, Amazon, Microsoft, YouTube), and • bring additional jobs to Santa Ana. We have met with Mr. Harrah on multiple occasions and we have explored a variety of possibilities for collaboration with Caribou Industries. Unfortunately, when considering our constraints and needs as a non-profit public school, we do not believe there is a way to effectively share the YMCA building. Three issues remain at the forefront: 1. As we discussed in our last meeting, financing through a New Markets Tax Credit is contingent upon fee ownership. Mr. Harrah has previously expressed interest in leasing a portion of the building to OCSA; however, that arrangement would disqualify us from the financing opportunity. In addition, if OCSA owned the building and leased a portion to Caribou Industries (assuming there were no issue with student safety and security), this would challenge the integrity of our non-profit status. 2. Student safety and security remains a challenge in sharing the building — particularly with a hotel. Our current campus is not accessible to the general public and is managed through an extensive access control system. As such, we cannot have hotel visitors entering the building (campus) and in close proximity where students are present. 3. In order to meet the instructional needs of the school and to honor our programming commitment to The Wooden Floor and Relampago del Cielo and the community, OCSA would need access and control of the entire building. Lastly, as you are aware, Mr. Harrah agreed to withdraw his interest in the YMCA building contingent upon OCSA purchasing his adjacent parking structure. Although we do not see the correlation between these two properties, we have once again reviewed our current parking plan and we remain confident that we have sufficient capacity to support the acquisition of the YMCA. In addition, it would not be economically feasible for OCSA to purchase the parking structure while also renovating the YMCA.