Loading...
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