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HomeMy WebLinkAbout04/11/84 MINUTES RA MINUTES BAKERSFIELD REDEVELOPMENT AGENCY Regular Meeting---April 11, 1984 The Regular Meeting of the Bakersfield Redevelopment Agency was called to order by Chairman Rockoff on Wednesday, April 11, 1984 at 5:03 p.m. in the City Hall Council Chambers. The Secretary called the roll as follows: MEMBERS PRESENT: James Barton James Childs Rollie Moore Thomas Payne Art Rockoff MEMBERS ABSENT: Donald Ratty MINUTES Upon a motion by Agency Member Childs, the Minutes of the Regular Meeting of March 14, and the Regular Meeting of March 28, 1984, were approved as presented. REPORTS Report from Robert Corsaro, representative of the Convention Center Hotel developer, regarding the financing of the proposed Convention Center Hotel. Mr. Corsaro stated that Aircoa has completed several projects and outlined each of them. He stated that in addition to the original investors, several others have indicated a desire to buy shares in the hotel. He stated that with the complexity of the project, it has taken the banks a little longer to present their proposal. Verbal commitments have been made by five institutions and Aircoa has now eliminated it to two whom they will meet with next week. He stated that there is also a chance that they can do this with a private placement and save a lot of underwriting fees which could go back into the project and secure their downside risk in the first two or three years. He commented that he is 101 percent sure that this deal will be financed, and they will get the guarantee for the letter of credit. He explained that the conceptual plans are in progress and should be completed. He stated that they will probably have the information by the 23rd, but no later than April 30th, on who the lender will be or who will be doing the financing. He stated that the Agency should take a close look at the offer for the second hotel. He stated that they talked to Mr. Gill and offered to let him look at their study because, in their opinion, there is no room for another hotel at this time. He commented that they believe that the Moreland Corporation should start with the first phase of the building and then work into the second phase. Agency Member Christensen asked when the final day of financing can be assured. Mr. Corsaro stated that they have the commitments, and it is a matter of finalizing these commitments. The final date would be April 23, and no later than the 30th to give the Agency the name of the lender. Agency Member Childs questioned if the financing of the project is finalized by the 30th, when would construction be anticipated to begin. Mr. Corsaro stated that as soon as they get the plans from the architect which would take approximately five months. They would like to start sometime in 1984 to break the ground. Agency Member Childs questioned the status of acquiring the property. Mr. Kennon explained that upon the submittal of the developer's proof of financing (letter of credit), the Agency has 30 days to review and approve it. Upon approval, the Agency has a minimum of six months to acquire, assemble and prepare the site for develop- ment. He stated that it is difficult to really determine how quickly the process might go. He further commented that there are certain public hearings that must occur. Agency Chairman Rockoff requested that Mr. Corsaro come back to the April 25 meeting to tell the Agency whether or not they have the financing, so that the Agency can start acquiring the land. Agency Member Childs questioned if there would be any problems with acquiring the area. Mr. Kennon stated that they have had numerous contacts with the property owners, and they are aware and supportive of the project and its benefits, and seem to be cooperative. He stated that the old Meat Packing Plant which is owned by an estate, would require a little effort, but no major problems are anticipated. City Attorney Oberholzer explained that several years ago the City went to court on that property and got an order in 1980 allowing the sale of that property, but the estate has been in probate since 1967 and it is still not completed. The trustee has notified the City that he is interested in pursuing a sale of that property. Agency Member Childs questioned how this would affect the project. City Attorney Oberholzer stated that it would proceed in eminent domain and the Agency would have to go with an action of immediate possession, and act out the litigation with respect to fair market value. Report from Gordon Gill, representative of Moreland Development Corporation, regarding the status of negotiations with California Republic Bank. Mr· Gordon Gill, of Millard Archuleta, Eddy, Paynter Associates, stated that they have had discussions with California Republic Bank with regard to acquisition of approximately 10,260 square feet of the parking ramp and parking facilities for the construc- tion of the first phase of the Galleria. He commented that the banks have been cooperative, and they are in the final stages of preparing the agreement. As a part of the DDA, they are required to settle the acquisition of the parking ramp, with a portion of the parking structure, with the bank and the owners of that property. He stated that there are four entities that they have to discuss the acquisition with: California Republic Bank, Chester Avenue Associ- ates, First Interstate Bank, and the tenants of the California Republic Bank building. To accomplish this acquisition, all parties have to agree to a final resolution with regard to the acquisition of that property. He stated that it is premature whether they would be successful in negotiating a lease and purchase price with all the parties. He stated that if they are unable to successfully negotiate an agreement with all parties concerned, they request the Agency's consideration with regard to eminent domain proceedings at that point, only if they are unable to proceed with the acquisition based upon the provisions of the DDA. Agency Member Christensen questioned if they were going to use eminent domain because it is ablighted area. City Attorney Oberholzer stated that the basis of eminent domain would be an issue of public necessity. He explained that the whole redevelopment project area has a general provision that it is to be determined to be a blighted area, not any specific piece, but it is a general overall concept, and the requirement is public necessity. A resolutionof public necessity must be adopted which requires an affirmative vote of five members. Agency Member Childs questioned the properties involved in this matter. Mr. Gill responded that it is the ramp that leads to the second level of the parking structure and approximatley 16 feet of depth on the existing structure on the southerly side. This property is owned by California Republic Bank. City Attorney Oberholzer stated that the most the Agency could do is indicate that they would consider eminent domain at this time. There are procedures that have to be followed to change the DDA. Agency Member Moore questioned who would initiate the proceedings. City Attorney Oberholzer responded that, whether or no~ the Agency must use eminent domain will depend upon whether the developer can make or negotiate a purchase of the property, if not, then the Agency can consider the use of eminent domain. This particular property was not included in those properties to be acquired by the Agency, but instead, it specifically provided in the DDA the developer was to acquire it. There is no provision for the Agency to either negotiate for the purchase of the subject property or for the Agency to use powers of eminent domain. Before any action could be taken, a public hearing would have to be held to make changes to the DDA. Anything the Agency does would not be binding, at this time, but it may indicate the intent of the Council. Agency Member Payne questioned if Mr. Gill's request was for the Agency to use eminent domain to insure the continuation and progress of the Galleria project. Mr. Gill responded that only if it is necessary, if they cannot negotiate with all the parties concerned and the Galleria project would be stopped because of it. Agency Member Moore questioned if the parking structure in question was part of the Redevelopment Agency project for the California Republic Bank building. City Attorney Oberholzer stated that the parcel of land which includes the parking structure and California Republic Bank was all part of the negotiation for that project and the City acquired portions of that land. He commented that the only reason the Agency should consider eminent domain is if the de- veloper is unable to acquire the property. Agency Member Childs stated that since the Moreland Corporation is still negotiating, it might cause some resentment to the other parties if the Agency should grant to consider this issue. He questioned if they could consider this matter until after the May 15 deadline, when Mr. Gill comes back with his proposal regarding the status of the parking problem. Mr. Terry Moreland, of Moreland Development Corporation, stated that it is up to the Moreland Corporation to submit the financing of the project to the Agency. He stated that they have commitments in writing, and that a half a million dollars, non- refundable, would have to be put up, and every six months they would have to put up an additional $250,000. He stated that he did not want to put up that money and then deal with California Republic Bank, and therefore, asked that the Agency consider eminent domain now, because the deadline is May 21. Agency Member Moore questioned how long it would take to get the notice of public hearing and the changes made if the DDA needs to be changed. City Attorney Oberholzer stated that it would take approxi- mately 30 days, if they rush it through. Agency Member Childs made a motion, that since the Moreland Corporation is asking for a change in the DDA, to direct staff to begin proceedings to see what changes the Moreland Corporation is requesting in the DDA and provide the Agency with all the information necessary in case there is a need to implement some of those changes. City Attorney Oberholzer explained that eminent domain was used for the purpose of allowing the property owners of California Republic Bank the right to take advantage of the tax benefits, but did not proceed to trial on the acquisition of any of these properties. Agency Member Payne questioned staff if downtown redevelopment would work without the ability to exercise, or the Agency expressing a willingness to use powers of eminent domain and whether it is part of downtown redevelopment. Mr. Kennon stated that it is an important part of redevelopment. He explained that the Agency can do many things without concerning itself with eminent domain. However, major developments involving multiple properties owned by many different individuals cannot be achieved without eminent domain being a part of the strategy. He stated that there would be concern of any developer's ability to acquire and assemble a site if the Agency were reluctant to use eminent domain when it is necessary. Mr. Lawrence Guay, of Chester Avenue Associates, stated that they have been studying this proposal and before he makes any comments on the outcome of this project, that they must complete the negotiating phase that they are currently involved with. He commented that closing Eye Street is a problem for their project. He stated that he did not like being threatened by eminent domain during the middle of negotiations. He stated that anything else would be said at a public hearing. The motion made previously by Agency Member Childs, to direct staff to begin proceedings to see what changes Moreland Development Corporation is requesting in the DDA and provide the Agency with all the information necessary if they have to implement some of those changes, was carried. CONSENT CALENDAR (a) Design Review Board recommendations for approval: Signage for Western Outfitters, 1229 19th Street; 2. Signage for Emporium Western Store, 10t~ 19th Street; 3. Exterior remodel of the Morenet Building, northeast corner of 18th and Eye Streets; 4. Signage for the Potato Shed, 1804'Chester Avenue; 5. Signage for Ice Cream & Yogurt, 1408 18th Street; 6. Signage for Country Classic Gifts, 1919 Chester Avenue; 7. Exterior remodel and signage for L.A. Connection, 1615 19th Street. Upon a motion by Agency Member Payne, item (a) of the Consent Calendar was approved by the following roll call vote: AYES: Childs, Christensen, Moore, Payne, Rockoff, Barton NOES: None ABSENT: Ratty DEFERRED BUSINESS (a) Consideration of Moreland Development Corporation regarding request for a feasibility study to allow for consideration of a hotel within the proposed Truxtun Galleria project. Mr. Gordon Gill requested continuance of this issue until the April 25, 1984 Agency meeting. Agency Member Childs made a motion, to defer this item until the April 25, 1984 meeting, which was carried. NEW BUSINESS (a) Resolution No. RA2-84 of the Redevelopment Agency of the City of Bakersfield declaring the completion of the public parking facility located at 18th and Eye Streets. Agency Member Barton made a motion to adopt Resolution No. RA2-84 declaring the completion of the public parking facility located at 18th and Eye Streets, which was carried by the following roll call vote: AYES: Childs, Christensen, Moore, Payne, Rockoff, Barton NOES: None ABSENT: Ratty City Attorney Oberholzer stated that the sale could not be completed until the bonds, which were public bonds, were taken from the 18th and Eye Street garage and placed on the other garage. (b) Appointment of Design Review Board Members Acting Executive Director Richard Russell stated that the information would be presented at the next Agency meeting regarding the Design Review Board and the process for filling the vacancy. Martha Walters was recognized by Agency Member Moore and expressed her concern that the downtown should be preserved and that the developers should locate and develop with their own money. ADJOURNMENT There being no further business to come before the Redevelop- ment Agency, Agency Member Christensen made a motion to adjourn the meeting at 6:10 p.m. ARTHUR L. ROCROFF, ~/~4~an  Bakersfield Redevelop~ht Agency ~~R~e~o~tS~ry