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HomeMy WebLinkAbout08/20/1999 BAKERSFIELD (~/~~, l//~ Patricia J. DeMond, Chair .,~lan Tandy, City I~'n~ger Mike Maggard Staff: Darnell Haynes Mark Salvaggio AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE Friday, August 20, 1999 12:00 noon City Manager's Conference Room 1. ROLL CALL Call to Order at 12:10 p.m. Present: Councilmembers: Patricia J. DeMond, Chair; and MarkSalvaggio Absent: Councilmember, Mike Maggard 2, ADOPT JULY 19, 1999 AGENDA SUMMARY REPORT Adopted as submitted. Councilmember DeMond made note that Councilmember Maggard did review the agenda prior to the meeting. 3, PRESENTATIONS None 4. PUBLIC STATEMENTS None 5. DEFERRED BUSINESS A. UPDATE OF AGREEMENT AND SECOND DEED OF TRUST WITH THE BAKERSFIELD MUSEUM OF ART Councilmember Maggard was apprised of the sole subject on the agenda prior to the meeting and was supportive of the meeting proceeding without his attendance. The City of Bakersfield's ("City") donation of property to the Bakersfield Museum of Art for the sum of $5,000 was to support their stated objective to remain in Central Park and enlarge ADOPTEI) AS $llBt. t-I't'TE])OIZTOBER 13, 1999 ilL[ COPY AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE Friday, August 20, 1999 Page -2- the facility. The sales agreement, as approved by both parties in September of 1997, included a clause which reverted the property to the City in the event it ceased to function as a museum. Committee Chair DeMond stated it was her understanding that should the museum decide to sell to a third party at some future date, the existing legislative body in place at that time would have the option to exercise the right of first refusal. Deputy City Attorney Gennaro, stated the answer was yes. In October 1998, the Museum's director contacted City staff and indicated it was their desire to enlarge the facility in one phase, instead of in stages, as originally contemplated. This would require that bank financing be obtained. A request for additional property and funding from the City was also included. Over a period of several months, staff, museum representatives and Attorney Terence Werdel, legal counsel for the Museum, deliberated the issues. After an extended period of time, the focus was pdmadly on how to remove the reverter clause while protecting the City's interest. The subject was reviewed and discussed during Committee meetings on February 8, March 29, and May 17, 1999. Atthe July 19, 1999 meeting, an agreement appeared to be reached to eliminate the reverter clause and giving the City a right of first refusal. A final draft of the proposed amendment was forwarded to Attorney Werdel for examination. The Committee's meeting on August 20, 1999 remained scheduled as this subject was the only item on the agenda to affirm the amendment, and forward it to the Council for action on August 25,'1999. Committee Chair DeMond stated it was her understanding that should the Museum cease to function as such, or a decision was made to sell to a third party, the legislative body in place at that time would have the option to exercise the right of first refusal. Deputy City Attorney Gennaro stated the answer was yes. Attorney Werdel then indicated concern the term "right of first refusal" was too vague and unenforceable. There also was discussion regarding the method and what an appropriate basis for valuing the property would be 'in the event a cause for reversion would occur. Attorney Gennaro read language clarifying the City's intent. The "Beneficiary," which is the City, "shall have the option of first right of refusal to purchase said property." The purchase price is to be based upon an appraisal prepared in accordance with the Uniform Standard of Professional Appraisal Practice (USPAP). There was agreement that three (3) appraisals would be obtained, with the City paying for one. There was also agreement the methodology to .be utilized would be determined by the appraisers at the time such action would be required. AGENDA SUMMARY REPORT BUDGET AND FINANCE COMMITTEE Friday, August 20, 1999 Page -3- The Committee asked if there were any further general issues of legal language that needed to be worked out. There was agreement that the Committee, Museum representatives and staff felt comfortable with the proposed concepts. Committee Chair DeMond called for the motion. It was unanimously approved and staff was directed to forward the finalized agreement to the full Council for consideration at the August 25, 1999 Council meeting. 6. NEW BUSINESS None 7. COMMITTEE COMMENTS The Committee's thoughts were expressed by Committee Member Mark Salvaggio when he stated everyone felt the Museum should remain in Central Park and hoped this agreement would facilitate that objective. 8. ADJOURNMENT The meeting was adjourned'at 12:30 p.m. Staff present:City Attorney, Alan Tandy; Assistant City Manager Alan Christensen; Assistant to the City Manager Damell Haynes; City Attorney Bart Thiltgen; and Deputy City Attorney, Virginia Gennaro. Others present: Chades Meyer and Terence Werdel, Bakersfield Museum of Art; Gene Tackett; and Richard Chang, Bakersfield Californian. cc: Honorable Mayor and City Council DWH:al S:\Darnell\Bud and Fin\BF99aug20minutes.wpd