HomeMy WebLinkAbout09/12/84 MINUTES RA MINUTES
BAKERSFIELD REDEVELOPMENT AGENCY
Regular Meeting--September 12, 1984
The Regular Meeting of the Bakersfield Redevelopment Agency was
called to order by Chairman Rockoff on Wednesday, September 12, 1984
at 5:00 p.m. in the City Hall Council Chambers. The Secretary
called the roll as follows:
MEMBERS PRESENT
James Barton
James Childs
Chris Christensen
Rollie Moore
Thomas Payne
Art Rockoff
MEMBERS ABSENT:
Donald Ratty
CORRESPONDENCE
Upon a motion by Agency Member Barton, communication received
from Roger W. Yates, received September 11, 1984, in opposition to
the Truxtun Galleria project, was received and ordered to be placed
on file.
REPORTS
1. Status report on Galleria project.
City Attorney Oberholzer stated that the letter from Sears Savings
Bank that had been received at the August 29 Agency meeting was
determined not to meet the requirement of the DDA for evidence of
financing. He stated that Mr. Moreland submitted a document to
Mr. Caravalho today from Harbour Financial Corporation which purports
to be a commitment for financing. He explained that pursuant to the
terms of the DDA the Agency can receive the document and staff can
review it and make a determination in 15 days as to whether it is
acceptable for financing.
City Attorney Oberholzer stated that if the Agency fails to
respond within the 15-day period, the commitment of financing is
deemed approved. He recommended that the meeting be continued to
another date in order to present the consultant's evaluation of this
latest proposal. If it does not meet the requirements, then the
Agency has the choice of either continuing on with the agreement
allowing the developer more time, or proceeding with a motion to
find the developer in default in which the developer would have 30
days to cure the default.
Agency Member Moore stated that there is frustration in the com-
munity regarding the nonperformance of the developer and the economics
of the project. All of the earlier estimates were based on the economy
at the time the Galleria project was being reviewed, and the economics
of the project today might place the city in financial jeopardy. He
stated that during this 15-day period the Agency should determine if
these delays are causing possible detriment to the City. He stated his
concern about the two defaults placed on the developer: the financing
and inability to put together the purchasing of the project with
California Republic Bank.
City Attorney Oberholzer stated that one other area of default is
the exchange agreement between California Republic Bank and the developer
which has not been submitted. He stated that based on the DDA, the
Agency would proceed with a notice of termination for that particular
failure, and the developer would have 30 days in which to cure that
default. He indicated that it would be appropriate to see if the
document is valid evidence of financing, and if it is acceptable, and
an agreement has not been reached with California Republic Bank then
the Agency may want to force the issue.
Agency Member Childs asked what would happen if the Moreland
Corporation comes to an agreement with California Republic Bank, but
not with Chester Avenue Associates.
BAKERSFIELD REDEVELOPMENT AGENCY MEETING, Septembe 12, 1984 - Page 2
City Attorney Oberholzer stated that the draft agreement between
California Republic Bank and the Moreland Corporation purports to
accomplish this effort.
Agency Member Childs questioned if they had come to an agreement
with California Republic Bank and not with Chester Avenue Associates,
would they still be in default.
Mr. Oberholzer stated that apparently California Republic
Bank is willing to compensate Chester Avenue Associates, but if
California Republic Bank can agree with Moreland then California
Republic Bank is responsible to Chester Avenue Associates.
Executive Director Caravalho recommended that the Agency
adjourn their meeting until September 27 at 8:00 p.m. in order to
review the document received from Harbour Financial Corporation and
California Republic Bank.
Mr. Ralph Wegis, Attorney for the Moreland Corporation, stated
that they have had discussions regarding Chester Avenue Associates
and California Republic Bank. He stated that they might have an agreement
with California Republic Bank. What remains to be agreed upon is the
interest of the leaseholder, Chester Avenue Associates. They have
leased the rights from California Republic Bank and specifically, what
their concern has narrowed down to is what is to be done with the
location and construction of a parking structure. There have been
various proposals with regard to resolving that problem, and a report
was given to the Agency at the last meeting with a feeling that there
was an agreement in principle based upon an oral meeting which was
reduced to writing that turned out to be unsaleable. He commented
that he learned from other sources that some of the unwillingness
of Chester Avenue Associates to negotiate their interest in the ramp
was that they wish for some decision to be made on financing. He
requested that the Agency allow the Development Committee to meet with
the interested parties in order to help put this issue to rest. He
stated that they would only participate in information and resolution
of the problems relative to the letter of commitment.
Mr. Gordon Gill, of Millard Archuleta, Eddy, Paynter Associates,
gave a status report on the negotiations with Chester Avenue Associates.
He stated that after several attempts to amend the design for the
parking structure which have been unacceptable to Chester Avenue
Associates, he is requesting that the Agency's Development Cormmittee
assist in getting both parties together to negotiate an agreement
to resolve any outstanding issues in order to move forward.
City Attorney Oberholzer asked Mr. Wegis as representative of
the Moreland Corporation, if he concurred with the continuation of
the Redevelopment Agency on September 27 at 8:00 p.m. in order to
prepare a response to the proposed letter of commitment from Harbour
Financial Corporation.
Mr. Wegis responded that they had no problem with this date and
time.
Mrs. Martha Walters, citizen, was present and asked several
questions of staff and also expressed opposition to the Galleria
project.
Ms. Elizabeth Van Alstein stated that she was in opposition to
the Galleria project and outlined several reasons. She stated that
the site is not a blighted area and, therefore, needs no rehabilita-
tion.
Mr. Fred Katz, businessman, stated that there are other outstanding
problems in Bakersfield and downtown, and that the Galleria project would
be beneficial to the downtown.
Mr. Pat Shaffer, Bakersfield College Dean of the Downtown Center,
stated his support for the Galleria project and any other developments
in downtown Bakersfield. He stated that rejuvination is needed in this
area.
BAKERSFIELD REDEVELOPMENT AGENCY MEETING, September 12, 1984 - Page 3
Mr. Nathan Krevitz stated that he is in opposition to the Galleria
project because the government and taxpayers' money will be spent on
private enterprise.
Chairman Rockoff stated that it would be in the best interest
of the Agency for the Development Committee to meet with the parties
within this 15-day period in order to obtain more information.
Agency Member Childs made a motion to table item one until the
completion of the agenda.
Agency Member Childs made a second motion to direct staff to see
if there would be any violation of the DDA in assisting the parties
in their negotiations.
Upon a motion by Agency Member Childs, item one, evaluating
performance on the part of the Moreland Corporation as per Galleria
DDA, was tabled until the completion of the agenda.
Agency Member Childs made a motion to direct staff to assist the
Moreland Corporation in trying to reach an agreement with Chester
Avenue Associates.
City Attorney Oberholzer stated that the parties to the agreement
are the Moreland Corporation and California Republic Bank, and
pursuant to the DDA the Moreland Corporation has the obligation to
acquire the property from California Republic Bank. Mr. Oberholzer
stated that this meeting would be held to get an understanding of
what was occurring. He stated that in the past, the Development
Committee has listened to each of the parties and then had the two
parties together in a committee meeting and the resolution of that
meeting was only to proceed on.
Mrs. Walters expressed opposition to the previous motion stating
that government has no business in this effort when there is opposition
in the community to the total project. It is a violation of the trust
of the elected officials. If the parties cannot work it out between
themselves, the City shouldn't intervene.
Agency Member Childs withdrew the motion.
Agency Member Payne questioned if the Committee chairman and staff
could meet with the parties.
Agency Member Childs made a motion to continue on with the agenda.
Executive Director Caravalho stated that prior to coming to the
City there was support and interest in this project, and the Agency
entered into this contractual agreement with that intent and were
therefore, partners in this venture. In order to proceed along, the
partner has asked the Agency to facilitate in a manner to reconcile
whether the project could go forward. He suggested that maybe the
Agency should direct the Executive Director to bring the parties
together.
Chairman Rockoff stated that in 15 days the Agency should have as
much information as possible to make decisions on the two basic issues
that have to do with financing and the agreement with California
Republic Bank and Chester Avenue Associates.
Mr. Larry Moxley questioned what would happen if the developer
comes back in 15 days with another commitment.
City Attorney Oberholzer stated that if the letter submitted
is found to be unacceptable, the Agency would have several alternatives
available to them. If it is acceptable, the project will proceed. If
the remedies available are not acceptable to allow the project to
continue or that there has been a failure of performance, the Agency may
institute proceedings to terminate the agreement. He stated that if
the developer presented a letter after the 15-day period,it could go
BAKERSFIELD REDEVELOPMENT AGENCY MEETING, September 12, 1984 - Page 4
on indefinitely but it would trigger the ability of the Agency to
declare a default and proceed with termination. If the Agency finds
them in default, they have 30 days to cure the default or the project
may be terminated.
Mr. Norman Walters, citizen, stated that the Agency should make
the decision of termination which allows the developer 30 days to
"put up or shut up."
Agency Member Moore called for the question which was approved.
Agency Member Childs motion to continue with the agenda was
approved.
CONSENT CALENDAR
(a) Approval of Vouchers No. 47 thru 52 totaling $620.30.
Agency Member Childs made a motion to adopt item (a) of the
Consent Calendar by the following roll call vote:
AYES: Moore, Payne,
NOES: None
ABSENT: Ratty
Rockoff, Barton, Childs,
Christensen
NEW BUSINESS
(a) Fourth Implementation Agreement for Convention Center Hotel.
Upon a motion by Agency Member Moore, Resolution No. RA5-8~ of
the Redevelopment Agency approving and authorizing the execution of
a Fourth Implementation Agreement to the DDA between the Bakersfield
Redevelopment Agency and Bakersfield Metropolitan Association, was approved
by the following roll call vote:
AYES: Moore, Payne,
NOES: None
ABSENT: Ratty
Rockoff, Barton, Childs,
Christensen
(b) Developer's evidence of letter of credit.
Upon a motion by Agency Member Moore, the Commercial Credit
Commitment Report indicating completion of the review of the letter of
credit was approved by the following roll call vote:
AYES: Moore, Payne,
NOES: None
ABSENT: Ratty
Rockoff, Barton, Childs,
Christensen
ADJOURNMENT
Agency Member Moore made a motion to adjourn the meeting to a
certain time of 8:00 p.m. on September 27.
Agency Member Payne questioned whether the members of the
Development Committee feel comfortable in meeting with the developer.
Agency Member Barton stated that he agreed with Chairman
Rockoff that there is alot of information that the Agency should have in
order to know exactly where they stand and how to proceed.
Agency Member Moore made a substitute motion to have the Chairman
and the City Attorney meet with both parties. This motion was
approved.
Upon a motion by Agency Member Moore the meeting was adjourned
to continue until a certain time of 8:00 p.m. on September 27.
akefs~i~fld Redevelopment Agency
ARTHUR L. ROCKOFF,~hairman
Bakersfield Redevelopment Agency