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HomeMy WebLinkAbout01/22/1985 . DOWNTOWN MINUTES REGULAR JOINT MEETING DEVELOPMENT COMMISSION/COMMUNITY REDEVELOPMENT SANTA ANA, CALIFORNIA JANUARY 22, 1985 AGENCY The Regular Joint Meeting of the Downtown Development Commission/Community Redevelopment Agency was called to order by Vice Chairman P. Lee Johnson at 7: 02 PM in the lower level conference room of the Standard Concrete Building at 117 West Fourth Street, Santa Ana, California. Following the Pledge of Allegiance, the roll was called: PRESENT ABSENT . Daniel Griset, Chairman (7:28 PM) Wilson B. Hart P. Lee Johnson, Vice Chairman Robert Luxembourger patricia McGuigan Scott Morgan (ex-officio alternate) Daniel 8. Young John Acosta Others in Attendance: . Robert C. Bobb, City Manager Jan Perkins, Deputy City Manager/Operations Rex Swanson, Deputy City Manager/Development Edward Cooper, City Attorney Janice Guy, Clerk of the Council Dave Ream, Executive Director/Economic Development Phil Freeland, Executive Director/Community Development and Housing Laurie Cottrell, Executive Director/Communications and Marketing Roger A. Kooi, Downtown Development Commission Director Edward V. Henning, Asst. Director Downtown Development Commission Robert Hoffman, Principal Real Estate Officer Ken Tomlinson, Santa Ana Police Department George Gragg, Community Preservation Officer Gareth T. Craig, Downtown Development Commission Admin. Asst. Janet Grane, Downtown Development Commission Stenographic Clerk Angel R. Viley, Downtown Development Commission Temporary Clerk Mark Briggs, President of Mark Briggs and Associates, Inc. Irving M. Chase, Greater Eastern Development Corp. MINUTES A motion was made by Commissioner Luxembourger, seconded by Commissioner McGuigan, and carried unanimously (5: 0) to approve the minutes of the Regular Joint Meeting held on November 20, 1984. I~-- - - PUBLIC HEARING Vice Chairman Johnson announced that this was the time and place for the Public Hearing on the issue of the public necessity to aquire by condemnation that property identified by Assessor Parcel Numbers as Book 402, Page and Block 101, parcels 1, 2, 3, 4, 7, 21, 22, 23, 25 and a portion of parcel 26, and Book 402, Page and Block 112, parcels 1 and 2, for redevelopment purposes, Vice Chai rman Johnson requested that staff identify the property or issues and give staff recommendation. David N. Ream, Executive Director/Economic Development, introduced Robert B. Hoffman, principal Real Estate Officer of the Economic Development Agency. Mr. Hoffman read from a prepared statement as follows: . The property is located west of the Newport-Costa Mesa Freeway, north of Edinger Avenue and east of Ritchey Street, and contains approximately 43 acres. Approximately 95% of the site is owned by the Santa Fe Railway Company and the Santa Fe Land Company, and is used on an interim basis for agricultural purposes. The remainder of the site in the vicinity of Trotter Street, which will serve as the major entryway into the Auto Mall, is occupied by two service stations, a firewood retailer, a soil and plant testing laboratory, an industrial hardware distributor, and restaurant parking. The redevelopment project is a retail auto mall comprising dealèrships for at least ten makes of new automobiles. . The public interest and necessity require the property for the 'following reasons: . 4. 1. At its meeting of December 18, 1984, the Redevelopment Agency executed nine Lease, Option and Development Agreements for redevelopment of all of the subject properties as an auto mall. 2. The aformentioned Agreements provide that the Agency shall convey the subject property to the redevelopers for development of the auto mall. I 3. This redevelopment project represents an effort by the Redevelopment Agency to retain existing auto dealerships in Santa Ana. It is estimated that the possible relocation of a substantial number of the City's present dealerships to other cities would result in a sales tax loss for the Ci ty of over $800,000 per year. In addition, recruitment of new dealerships into the mall, and the general volume increases typically realized by such "massing" of dealerships, is expected to produce additional sales tax revenues for the City of approximately $900,000 per year. The development of the Auto Mall promotes the goals and objectives of the Redevelopment Plan for the South Main Redevelopment project through private commercial development and capital investment, the development of vacant land in the project Area, and the improved market potential for surrounding vacant and under-utilized parcels. 1 . The project is planned and located pursuant to meetings and hearings held by the City's Redevelopment Commission, the Planning Commission, The Redevelopment Agency and the City Council. As previously mentioned, 95% of the site is presently utilized for agricultural purposes, minimizing the number of businesses which must be relocated. All of the businesses to be displaced are eligible for and will receive full relocation assistance benefits according to Federal And State laws. All of the subject property is necessary for the project in order to provide adequately sized parcels for dealerships, ,and in order to ensure adequate access to and visibility of the development. Offers of just compensation have been made to all record property owners, pursuan t to Section 7267.2 of the Government Code. In fact, negotiations continue for all of the subject property, however, project schedules require that the Agency adopt the subject resolutions at this time in order to guarantee our timely possession of the site, and in order to keep our commitments to the auto dealer developers. Vice Chairman Johnson requested to hear from those persons in favor and those persons opposed to the issue. . Mike Lucey, of 1201 South Beach Blvd. in La Habra, California, spoke as a property specialist of Chevron U.S.A. Inc. Mr. Lucey expressed opposition to the redevelopment program using all of the property. He stated that the Chevron service station currently located on parcel 25 was built in 1971 and is estimated by Chevron to be a potentially viable business for another 25 years. Mr. Lucey stated that the service station owner had received an offer to purchase which was only for the property rather than one which included the existing facilities. Mr. Lucey further stated that a building permi t had been granted by the Ci ty for work which was completed in July, 1984. According to Mr. Lucey, an appraisal is being done by Chevron, inclusive of both the land and the facility. Upon completion of such an appraisal, Mr. Lucey indicated that he would submi t the resul ts to the Agency. Charles McClung, Jr., an attorney representing Otis Matkin, spoke on behalf of his client regarding parcels 402-101-21 and 22. Mr. McClung objected to the necessity of those parcels for this development, pointing out that these parcels would be part of a 5 acre parcel which is larger than the other proposed parcels. 'Otis Matkin, of 18041 Blue Ridge Drive in Santa Ana, spoke as the owner of Soil and plant Laboratory, Inc. which currently occupies parcels 21 and 22. Mr. Matkin stated that his building was constructed in 1946 and was specifically designed for his business. Mr. Matkin stated that this was not a case of redevelopment, but simply a development matter. He further expressed an opinion that this was not an issue of public good, but, rather, one of City convenience. Mr, Matkin stated that any attempts to inflict the least private injury had not been fulfilled because he had worked to find another location and his present location cannot be replaced. In addition, Mr. Matkin contended that a suitable relocation would cost more than double what he had been offered for his property by the Agency. 1 . D.W. Sprague, of 5832 Velfield in Huntington Beach, California, spoke as a representative of the Sixty-Eight Scar teen Corporation/union oil Company of California regarding parcel 402-10-1-23. Mr. Sprague stated that he operates a modern facility which he feels would enhance the project rather than interfere with it. Mr. Sprague further stated that the offer for the property which he has received from the Agency is "woefully inadequate" and that he had previously submitted an independently solici ted appraisal to the Agency. Following Mr. Sprague's comments, and having no additional individuals present wishing to comment, the public hearing was declared closed. Mr. Luxembourger asked if staff planned to widen the street upon which the subject parcels are located. Rex Swanson, Deputy City Manager/Development, stated that the street under discussion will be an entrance to the Auto Center. Mr. Ream explained that it was an important street by its nature, and that it will be improved and slightly widened. Mr. Luxembourger asked why the subject street would be a major entry in consideration of the egress/ingress rights on Ritchey. Mr. Ream replied that there was no comparison between the two streets in terms of traffic entries. Mr. Luxembourger then asked, in reference to the service station, if compensation would be based upon Agency appraisals or on the station's . appraisals. Mr. Ream replied that Agency appraisals would be used, at which time Edward Cooper, City Attorney, stated that the Agency was not committed to dollar amounts at this time. Chairman Griset entered the meeting at 7:28 PM, at which time Vice Chairman Johnson deferred to the Chairman. Mr. Young stated that the meeting was neither the time nor the place to settle value amounts, and that he hoped the Agency would be sensitive to particular situations. Mr. Hart inquired about Mr. Matkin's entitlement, and Mr. Ream deferred to Mr. Hoffman. Mr. Hoffman assured all that just compensation for the property, as well as for the cost of relocating, would be forthcoming and that compensation may be available for Mr. Matkin's loss of good will. Mr. Hart then asked if "just compensation" was fair market value or replacement value, to which Mr. Hoffman responded that it was fair market. Mr. Hoffman went on to explain that, if Mr. Matkin were to purchase a new building, he would receive more years of use from the new structure than could be expected from the existing structure. . Mr. Luxembourger inquired regarding the time factor pertaining to the relocation. Mr. Hoffman stated that rough grading is scheduled to begin in late March, but that the dealer improvements on the south portion of the project were more flexible and that a two month extension would be possible. Mr. Luxembourger asked if an extension of time could be incorporated into the motion. Mr. Swanson suggested, as an alternative, that staff be instructed to be sensitive to needs regarding relocation and be instructed to report back to the Agency. 1 Ms. McGuigan pointed out that finding a greenhouse to replace Mr. Matkin's . facility may not be possible, and that the Agency may need to perform construction. Mr. Swanson replied that such accommodations had been performed in the past and that the Agency is used to working with special environs. Vice Chairman Johnson asked if there is a mechanism to lessen the economic crunch, to which Mr. Swanson replied that financing programs are available. Pursuant to the resolution of questions, comments, and discussion, Chairman Griset called for a vote, It was moved by Mr. Young, seconded by Vice Chairman Johnson, and carried unanimously (6:0) to adopt the following: 1. Resolution No. 85-02: A RESOLUTION OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA AUTHORIZING AND DIRECTING THE CONDEMNATION OF CERTAIN REAL PROPERTY FOR REDEVELOPMENT PURPOSES IN THE SANTA ANA AUTO CENTER DEVELOPMENT SITE IN THE CITY OF SANTA ANA, STATE OF CALIFORNIA, AND DECLARING THE PUBLIC NECESSITY THEREFOR (ASSESSOR PARCELS 402-101-01, 402-101-02,402-101-04, AND 402-112-02); . 2, Resolution No. 85-03: A RESOLUTION OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA AUTHORIZING AND DIRECTING THE CONDEMNATION OF CERTAIN REAL PROPERTY FOR REDEVELOPMENT PURPOSES IN THE SANTA ANA AUTO CENTER DEVELOPMENT SITE IN THE CITY OF SANTA ANA, STATE OF CALIFORNIA, AND DECLARING THE PUBLIC NECESSITY THEREFOR (ASSESSOR PARCELS 402-101-03, AND 402-112-010) ; 3. Resolution No. 85-04: A RESOLUTION OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA AUTHORIZING AND DIRECTING THE CONDEMNATION OF CERTAIN REAL PROPERTY FOR REDEVELOPMENT PURPOSES IN THE SANTA ANA AUTO CENTER DEVELOPMENT SITE IN THE CITY OF SANTA ANA, STATE OF CALIFORNIA, AND DECLARING THE PUBLIC NECESSITY THEREFOR (1535 TROTTER AVENUE); 4. Resolution No. 85-05: A RESOLUTION OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA AUTHORIZING AND DIRECTING THE CONDEMNATION OF CERTAIN REAL PROPERTY FOR REDEVELOPMENT PURPOSES IN THE SANTA ANA AUTO CENTER DEVELOPMENT SITE IN THE CITY OF SANTA ANA, STATE OF CALIFORNIA, AND DECLARING THE PUBLIC NECESSITY THEREFOR (2021 EAST EDINGER AVENUE); 5. Resolution No. 85-06: A RESOLUTION OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA AUTHORIZING AND DIRECTING THE CONDEMNATION OF CERTAIN REAL PROPERTY FOR REDEVELOPMENT PURPOSES IN THE SANTA ANA AUTO CENTER DEVELOPMENT SITE IN THE CITY OF SANTA ANA, STATE OF CALIFORNIA, AND DECLARING THE PUBLIC NECESSITY THEREFOR (1530-1534 TROTTER AVENUE); , 6. Resolution No. 85-07: A RESOLUTION OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA AUTHORIZING AND DIRECTING THE CONDEMNATION OF CERTAIN REAL PROPERTY FOR REDEVELOPMENT PURPOSES IN THE SANTA ANA AUTO CENTER DEVELOPMENT SITE IN THE CITY OF SANTA ANA, STATE OF CALIFORNIA, AND DECLARING THE PUBLIC NECESSITY THEREFOR (2031 EAST EDINGER AVENUE); 7. Resolution No. 85-08: A RESOLUTION OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA AUTHORIZING AND DIRECTING THE CONDEMNATION OF CERTAIN REAL PROPERTY FOR REDEVELOPMENT PURPOSES IN THE SANTA ANA AUTO CENTER DEVELOPMENT SITE IN THE CITY OF SANTA ANA, STATE OF CALIFORNIA, AND DECLARING THE PUBLIC NECESSITY THEREFOR (2051 EAST EDINGER AVENUE); 1 8. Resolution No. 85-09: A RESOLUTION OF THE COMMUNITY REDEVELOPMENT . AGENCY OF THE CITY OF SANTA ANA AUTHORIZING AND DIRECTING THE CONDEMNATION OF CERTAIN REAL PROPERTY FOR REDEVELOPMENT PURPOSES IN THE SANTA ANA AUTO CENTER DEVELOPMENT SITE IN THE CITY OF SANTA ANA, STATE OF CALIFORNIA, AND DECLARING THE PUBLIC NECESSITY THEREFOR (2101 EAST EDINGER AVENUE). REQUEST FOR CONCEPTUAL APPROVAL OF A-8 SITE PRELIMINARY MASTER PLAN AND AMENDMENTS TO THE EXCLUSIVE NEGOTIATION AGREEMENT Roger A. Kooi, Downtown Development Commission Director, deferred to Edward Henning, DDC Assistant Director, to present staff's oral report. Mr. Henning provided a very brief background on the City's first ownèr/tenant participation development site. Mr. Henning then introduced Mark Briggs, President of Mark Briggs and Associates, who has been serving as an Urban Development Action Grant (UDAG) consultant on this project. Mr. Briggs presented a summary of the UDAG program and indicated that the A-8 application would be submitted by the March 31st deadline. . Chairman Griset asked what the prospects for this development would be in the event that the UDAG is not procured. Mr. Briggs stated that such a scenario would mean higher equity for the owners. Mr. Hart asked what kind of return the owners would receive for their 30% equity, and Mr. Briggs replied that 10-15% is all that is expected. Mr. Young asked what was going to be done about the gap in finances. Mr. Briggs replied that several financial programs were available to the development entity. Mr. Young then asked at what point in the schedule the matter of private equity would come up. Mr. Luxembourger queried about the staging of construction. Mr. Henning stated that the Agency is buying several buildings within the si te. Relati ve to over-runs and the cost factor, Mr. Briggs stated that the development enti ty has to be responsible for its project. Mr. Young asked if there is now a central ownership entity and if it will be the party attempting to borrow, to which Mr. Briggs replied that, out of the Greater Eastern Development Corporation, a limited partnership having approximately 12 parcels will be formed and will retain parcel ownership. Mr. Briggs then introduced Mr. Irving M. Chase, of the Greater Eastern Development Corporation and of Chase Development, who narrated a land use master plan. Mr. Chase referred to extensive condi tions, covenants, and restrictions which would be intended to serve the community already in place. - Mr. Luxembourger asked what size the proposed parking structure will be. ~ Mr. Kooi stated that both a bond counsel and an economics consultant were being utilized for the proposed parking structure, with approximately 500 spaces being proposed at this time. Chairman Griset asserted that the development concept appears to be constantly changing. Mr. Chase responded that, due to the many individuals involved with the A-8 planning process to date, it has been a challenge to pinpoint an exact scope of development, but that it appears at this time that they are close to a final concept. Mr. Chase also stated that each owner will have to sign development agreements with the partnership, thereby assuring architectural maintenance and use controls over the entire A-8 site. Chairman Griset summarized the 1 . . . amendment to the development agreement, which will accelerate some improvements in the Downtown before the rest of the project becomes operative. Mr. Kooi stated that the amendment gives the Agency the ability to work toward the removal of four beer bars - El Latino, Chico Club, Balboa, and El Zarape. Mr. Luxembourger expressed a concern for other businesses in the area. A motion was made by Mr. Luxembourger, seconded by Mr. Young, and carried unanimously (6:0) to conceptually approve the preliminary A-8 site master plan and development methodology proposed by the Greater Eastern Development Corporation; and to approve amendments to the September 25, 1984 Exclusive Negotiation Agreement as follows: A. Provide for prioritized relocation of certain businesses within the A-8 site master plan; and B. Extend the effective term of the Exclusive Negotiation Agreement 90 days. RECESS At 8: 29 PM a recess was called. reconvened at 8:39. The parties present prior to the recess ORAL COMMUNICATIONS Mr. Kooi asked Mr. Cooper if it was necessary for the Downtown Development Commission to designate and formally appoint a Chairman and vice Chairman independently of the Community Redevelopment Agency. Mr. Cooper stated that such action was not required. ADJOURNMENT There being no further business to come before the Agency/Commission, the joint meeting was adjourned at 8:42 PM to a regular adjourned meeting of the City Council on this same day immediately following. Do.'. a.¡2;~ w Daniel E. Griset Chairman Executive Director/ Economic Development 1