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HomeMy WebLinkAboutMin - CC - 1976.12.06239 BURL i N6AME, CAL I FORN I A December 6, 1916 CALL TO ORDER A regular meeting of the Burlingame City Council was held on the above date in the City Hall Council Chambers. The meeting was called to order at B:05 P.M. by Mayor Victor A. Mangini. PLEDGE OF ALLEGI ANCE TO THE FLAG:Led by Wayne M. Swan, City Planner. ROLL CALL Counci I Counci I Members Present: Members Absent: Amstrup, Crosby, Harrison, Mangini, Martin None M I NUTES The minutes of the regular meeting of Novmeber 15, 19-76 were approved and adopted. Mayor Mangini introduced Mr. John Rando, director of Burlingame High School Choir, who led the caroling group of the choir in several well received renditions of Christmas music. HEAR I NGS 1. CITY COUNCIL APPEAL OF PLANNING COMMISSION APPROVAL OF SPECIAL PERMIT TO USE PORTION OF PROPERTY AT 2828 TROUSDALE DRIVE FOR CHURCH PURPOSES BY CONGREGATION OF JEHOVAHIS WITNESSES. Mayor Mangini requested report from the City Planner. City Planner reviewed circumstances leading to this appeal. He stated the Planning Commission on September 27r 1976 had approved special permit for this congregation with two conditions: The 4*t of blacktop paralleling the sidewalk was to be removed and replaced with planting, and all parking spaces were to be sfriped. After Council appeal of this Planning Commission decision, an amended site plan was received on December 1, 1976 which eliminated proposed re-subdivision of the property. City Planner quoted letter of November 30, 1916 from Grant Ellis, presiding leader of the BurliRgame Congregation, confirming there would be no parcel map to re-subdivide Lots 25 and 26. City Planner stated he had been informed that the slope of the property to the rear, permitting drainage of the parking area, would not be as steep as pneviously proposed. ln response to Council question, he sfated this site plan implements the two conditions of Planning Commission approval. Councilman Amstrup referenced letter of November 11, 1976 from Wm. M. Hardy, atforney for this church, which he felt implied the possibility that Council appeal was because of bias. He declared there was no prejudice involved, and that he strongly disagreed with the tenor of this letter. Mayor Mangini opened the meeting for publ ic comment. Mr. Grant Ellis, 1469 Bellevue Avenue, stated the church had decided at the conclusion of the Planning CommisBion hearing that the property would not be subdivided. He emphasized that the intention of the church was to cooperate in all respects with the Planning Commission and neighboring residents. He noted that the church is now the official owner of the property, since escrow cleared on December 3, 1916. Mr. James G. Koras, 2853 l4ariposa Drive, read from a prepared statement which listed his concerns as: subdivision of the two lots into three, thepossibility of the church building going to high rise, the possiblilty that development of future parking spaces on the hill behind the church would cause a slide, and weed problems on the property with possible fire hazard. I CHR I STN4AS PRESENTAT ION 240 lP r.* There were no further comments and the publicihearing was declared closed. Councilman Martin questioned the grade of the slope behind the church. This was estimated by the City Planner at approximately 1* to 1. Mayor Mangini questioned if weed abatement should be a condition of approval, but it was decided this was not necessary because of the Cityrs yearly weed abatement program. Councilman Amstrup raised the question of the rfNo Left'Turnff sign at the exit of the church parking.lot and City Planner stated the church representative had volunteered to erect such a sign. Replying to Mr. Korasr concerns, Counci lman Martin commented any possible high rise v'lould require Counci I approval, and engineering and proper construction of any additional parking on the slope would be the responsibility of the property owner. He considered this active congregation would keep the grounds weed-free and in good order, and added his main concern had been with the subdivision of these two lots. Councilman Harrison moved that the action of the Planning Commission be sustained, with the additional condition that arrNo Left Turnrrsign be installed at the parking lot exit. Second by Councilman Crosby, all aye roll call vote. 2. APPLICATION OF SOL AND HOPE GITTELSOHN TO RECLASSIFY A PORTION OF THE PROPERTY AT 15OO HOWARD AVENUE FROM R-l (SINGLE.FAMILY DWELLING) TO R-3 (MULTI.FAMI LY DWELLING) DISTRICT At the request of the Mayor, City Planner reviewed Planning Commission action on this application which included approval of tentative parcel map and reclassification, and passage of a resol ution recommending such reclassi fication. Noting Council approval on November 15, 1916 of this parcel map combining the two lots, City Planner quoted Code Section 25.12.020 (4) which provides that when two such lots in different zoning districts are combined and developed as a unit, the lesser restricted use applies to the whole. City Attorney added that because of this code, section reclassification is automatic, but formal action is being taken so that it can be a matter of record. There were no comments for or against this reclassification, and the public hearing was declared closed. Counci lman Amstrup moved that the Counci I accept Planning Commission recommendation for reclassification. Second by Counci lman Harrison, al I aye roll calll vote. ORDINANCE NO. 1095 IIAN ORDINANCE AMENDING SECTION 25.12.010 OF THE BURLINGAI.4E [4UNICIPAL CODE AND THE ZONING MAPS THEREIN INCORPORATED BY RECLASSIFYING LOT 3, BLOCK 4, BURLINGAME PARK N0. 2 FR0N4 FIRST RESIDENTIAL (R-1) DISTRICT TO THIRD RESIDENTIAL (R.3) DISTRICTI' was introduced for first reading by Counci lman Amstrup. COMMUNICATIONS .I. STATE OF CALIFORNIA DEPARTI4ENT OF TRANSPORTATION CONCERNING RELINQUISHMENT OF PROPERTY SKYLINE BOULEVARD Counci I had received communication from fhe State Department of Transportation dated November 23, 1976 notifying the City that the Department is now in position to formally relinquish rfParcel 1ff of State Highway right of way. Parcel 1 consists of portion of Skyline frontage road between Trousdale Drive and Rivera Drive and adjoining portion of Trousdale Drive. *;;i>a Jr a-ffiF ,*trrFftr4@t 24L I Communication included map of this parcel and copy of resolution to be adopted formally relinquishing title at the January, 197-7 meeting of the Hlghway Commission. Cify Attorney informed Council the City has 90 days to respond to this notification. lf no response is made, the State will go ahead with the rel inquishment. No action was considered necessary. STA[- F MEI4ORANDA CITY MANAGER: LIABILITY INSURANCE City Manager memo of December 2, 1976 enclosed proposals from several insurance companies on a City sel f-insured program for I iabi I ity insurance and a proposal by R.L. Kautz & Company, Los Angeles, for claims adjusting and administration of such a program. City Manager recommended proposal of Kindler & Laucci, 50 California Street, San Francisco for this $65,000 self-insured program and the firm of R.L. Kautz & Company for its administration. City Attorney explained ramifications of the program and the necessity for Counci I approval of contracts. With concurrence of Counci l, Mayor Mangini directed City Attorney to prepare neeessary documentation for submission to Council for these two compan i es. Councilman Martin announced he is opposed to a self-insured program andwill probably vote ttnott. 2. CITY MANAGER - COMMISSION APPOINTMENTS City Manager memo of December 1r 1976 transmitted applications for Council consideration of people wishing to serve on Beautification Commission and on Park and Recreation Commission. Memo noted'vacancy on Park and Recreation Commission caused by one memberts moving; and that two incumbents on each commission, whose terms are expired, are willing to serve another term. Counci lman Harrison nominated Frank J. Pagl iaror'Jr. for the Park and Recreation Commission fo fill vacancy caused by relocation of John 0rLeary. Counci lman Amstrup seconded the nomination; Nominations were closed on motion of Counci lman Harrison. Counci I agreed unanimously to the appointment of Mr. Pagl iaro. At this point Counci lman Martin commented he would vote against reappointing the present incumbents on the Park and Recreation Commission because of his position that no commissioner should serve more than two terms. Counci lman Harrison nominated Dennis Huajardo to replace Pol ly Hernick and nominated incumbent Wi I I iam Buetfler for another term. Counci lman Martin nominated Connie Schrager to replace Pol ly Herrick. Counci lman Amstrup nominated Pol ly Herrick, Mayor Mangini seconded the nomination. Nominations were closed on motion of Counci lman Crosby. Counci lman Crosby nominated Wi I I iam Buettler to continue on this commission. Counci lman Amstrup seconded the nomination. Nominations were closed on motion of Mayor Mangini. By vote of Council majority, Mrs. Herrick and Mr. Buettler were reappointed Counci lman Martin wished his vote recorded against Mrs. Herrick and Mr. Buettler for reasons previously stated. t 3 I 242 Mayor Mangini declared nominations open for the Beautification Commission. Counci lman Amstrup nominated incumbents Joseph Harvey and Dale Perkins for another term. Mayor Mangini seconded the nomination. Councilman Martin commented he was opposed only to Mr. Perkinst nomination because he had already served two terms. Nominations were closed. By vote of counci I majority Mr. Harvey and Mr. Perkins were reappoint<id. Counci lman Martin commented that notificaiion of openings on commissions would be erroneous if incumbents were constantly reappointed. 3 CITY CLERK: EXPIRATION 0F TERMS 0F CIVIL SERVIC COMM I SS IE ONERS City Clerkrs letter of November 15, 1976 notified of term expiration of two members of the Civil Service Commission, Dorothea W. l-lughes and Michael R. Nave. Mayor Mangini directed that applications be taken for these openings until the first Council meeting in January, 1977, and requested staff to check with incumbents to ascertain if they wish to continue serving. Counci lman Harrison stressed that new appl icants for these Commissions should be informed of the need for regular attendance. Councilman Crosby noted that one applicant for Park and Recreation, John C. Franklin, had shown a preference for the Civil Service Commission. Councilman Martin suggested that new applicants be given the same opportunity at these openings as the incumbents. 7)CITY ATTORNEY: SIGN PERMIT APPLICATI0N - DICK BULLIS CHEVROL City Attorney memo of November 24, 1976 reviewed current problems with outsize sign painted on wall facing railroad tracks at Dick Bullis Chevrolet Company, 100 Cal ifornia Drive. Memo noted City receipt of appl ication for this signrwhich Planning Commission had referred to Council for decision, since Counci I had heard original appeal on a Planning Commission decision on December 15, 1915. City Attorney recommended hearing on this matter. Mr. Vladimir Lefterotf, 4300 Camden Avdnue, San Mateo, appeared for Dick Bullis, and stated he would be Mr. Bullisr representative at the hearing. However, he would not be able to attend a meeting until January 1Jr 1977. Counci lman Amstrup emphasized that Mr. Lefteroff should be properly authorized to make decisions on Mr. Bul I isr behalf. Mr. Lefteroff stated he would have letter of authorizafion from Mr. Bul I is. City Attorney protested delaying hearing to this date because of the flagrant abuse of permit I imitations. With Counci I concurrence, Mayor Mangini set hearing for this appl ication on January |f, 1911. APPLICATION FOR AMUSEMENT LICENSE LUCKY LADY, 410 AIRPoRT BOULEVARD. APPL I CANTS COLLEEN JOHNSON AND RICHARD ROSSI, Counci I received letter of November 10, 1976 from Lieutenant Quinn, Burl ingame Pol ice Department, giving defai led information on principals and operation proposed for this estab;l ishment. The Police off icial noted he had requested written resume from Mr. Rossi of his business operations and associates or partners. To date this report had not been received. The communication advised that because of this and other complexities, the Department is not able to make a recommendafion yef. I+, 1 t.*-Ma.ri--. 243 Also transmitted to Council were two Fire Department reports dated OctoberB, 1976 and October 22,1976 noting deficiencies in sfructure in need of correct i on. Mayor Mangini questioned if there had been any change in information received by the Police Department. The Police Chief stated that a letter from the principals, dated December 1, 19-76, had been received in the City Clerkrs office, which he wished to check out. The Mayor suggesfed this matter be carried over to the next Counci I meeting. Mr. David Keyston addressed the Council on behalf of his tenants, Mr. Rossi and Ms. Johnson, stating they had been attempting to get on the Council agenda for six weeks; he urged action because the principals wished to open for young people in time for Christmas vacation. Police Chief noted this permit had been on the November 1 r 1916 agenda. At that time Police Department staff had requested the additional information. Nothing had been received unti I the letter of December 1. Councilmen Amstrup and Harrison voiced strong concerns about the number of people to be accomodated and the fact they are in the 10-21 age group. Mr. Robert Rossi, 238 Westview Drive, South San Francisco, emphasized that the intention at the present time was to open the club only for the first part of the proposed schedule, hours of 6:00 P.M. to 1:00 A.M. Security will be furnished by Anza patrol, and all young people under the age of 18 must observe the 10:00 P.M. curfew. He added he had clearance from the County Hea lth Department. Councilman Crosby pointed out that this information had not been received by the City, and Council could not act without police recommendation. There was further Council discussion, at fhe close of which Councilman Marfin suggested City Attorney work with Mr. Rossi to insure that all proper information is gafhered and submitted to the City. Hearing on this application was delayed until all information and police recommendation are recei ved. CONSENT CALENDAR TENTATIVE & FINAL PARCEL MAPS RECOMMENDED BY PLANNING COMMISSION: 1. 823/832 EL CAM|NO REAL. FRANK P. DoNAHUE AND THoMAS VANNoNI, APPLICI\|)ITS City Engineer memo of December 1, 1976 transmitted this tentative and findl ffiop, with explanation that its purpose is for the construction of apartments at this address. City Engineer recommended approval. Memo of December 1, 1976 from City Engineer transmitted this tentative parcel map, referred to Council because easements are required. Approval was recommended. - 3. ENCROACHI4ENT PERM I T DAVID N4. KENNEY 1 330 CAST I LLO AVENUE Assistant City Engineerrs memo of December 1, 1976 transmitted map and explanation of this encroachment which increases backyard area at this address. Approval was recommended. Counci lman Harrison moved consent calendar approval. Second by Counci lman Crosby. Al I aye rol I cal I vote. ( 2. 958 CHULA VISTA AVENUE. THON4AS MCLAUGHLIN. OWNER 241 RESOLUT I ONS 1. RESOLUTION NO. 81-16 IIAFFIRMING GRANTING OF SPECIAL PERMIT 1521 CABRILLO AVENUE, BURLINGAME|| was introduced by Counci lman Harrison who moved its adoption. Second by Counci lman Amstrup, carried on fol lowing rol I cal I vote: AYES: COUNC I LMEN: NAYES: COUNC I LMAN: AMSTRUP, CROSBY, HARRISON, MANGINI MARTlSl (for reasons given at November 15, 1916 meeting) 2. RESOLUTION NO. 88-76 IIAUTHORIZING EXECUTION OF AGREEMENT WITH DE LEUW, CATHER & COMPANY FOR ENVIRONN4ENTAL IMPACT REPORT FOR THE BROADWAY GRADE SEPARATIONT| was introduced by Counci lman Crosby who moved its adoption. Second by Counci lman Martin, al I aye rol I cal I vote. 3 RESOLUTION NO 89-16 IIAUTHORIZING AGREEMENT WITH COUNTY OF SAN MATEO FOR PART IC I PAT ION I N THE PUBL IC SERV ICE EI4PLOYMENT PROGRAM.II There was Council comment that this resolution and attached material had not been received in sufficient time for thorough investigation. City manager explained this routine documentation had just been received today and must be returned to County by December 15, 1976. RESOLUTI0N N0. 89-76 was introduced b y Counci lman Crosby, adopt i on, ORD I NANCES second by Counci lman Harrison, al I aye rol I cal who moved its I vote. Second Reading Hearing 1 . ORD I NANCE NO. 1 092 IIORD I NANCE AN4END I NG SECT I ON 25 .12.020 OF THE BURLINGAME MUNICIPAL CODE REGARDING ZONING DISTRICT BOUNDARlESil was given its second reading. Mayor Mangini declared the hearing open. There were no comments from the floor and the hearing was declared closed. On motion of Councilman Harrison, second by Councilman Crosby, the ordinance passed its second reading and was unanimously adopfed on rol I cal I vote. 2. ORDI NANCE NO 1093 'IORDINANCE ADDING CHAPTER 4.14 TO THE BURLINGAME MUNICIPAL CODE TO ESTABLISH RESERVE FUND FOR WORKERSI COMPENSATION CLAIMSII was given its second reading. Mayor Mangini declared the hearing open. There were no comments from the floor and the hearing was declared closed. On mofion of Councilman Harrison, second by Councilman Crosby the ordinance passed its second reading and was unan imous I y adopted on rol I ca I I vote. 3 ORDINANCE NO 4 IIAN ORDINANCE AMENDING THE PROVISIONS OF CHAPTER 9.04 OF THE BURLINGAME MUNICIPAL CODE RELATING TO DOG LICENSING AND IMPOUND ING FEESTT was given its second reading. Mr. Richard F. Ward, General Manager of the Peninsula Humane Society, announced his avai labi I ity for questions. Mayor Mangini declared the hearing open. There were no comments from the floor and the hearing lvas declared closed. Counci lman Martin had several objections to this ordinance. He considered the impound fees, particularly $60.00 for the fourth offense, excessive; and that they amounted to a trial by agency with no recourse in a court of law. He suggested that an increase in license fee dright be difficult for senior citizens who have watchdogs. He particularly objected to the house fo house investigation by Humane Society staff to see if animals are in the household. He commented on the personal experience of being sent a notice to get a dog license because of their observance of a cat dish. t, .iLitu.&4 rery- 245 To these sfatements Mr. Ward replied that the Humane Society is presenting to the County for implementation as soon as possible a senior citizen license and impound fee schedule; and that the people who were responsible for the house to house program are no longer with.the Society. The program is being redeve I oped. Councilman Harrison approved of increased license fees so that the Society could perform more adequate service, but disapproved of increased impound fees. Mayor Mangini approved the fee increase in both licensin$ and impounding,citing large number of dogs running loose, particularly on the school campus and their possible danger to the community. Councilman Amstrup suggested the ordinance be amended to increase license fees but not impound fees. Councilman Martin emphasized his objection was not the amount of impound fee but the apparent effort to impose a fine. He suggested Council wait on ordinance unti I senior citizensr fees are proposed. Mr. Ward replied impound fees were raised because of repeated of,fenders, and noted fee schedule is in effect for orily one year after which it will be reviewed Counci lman Harrison moved Ordinance 1094 be adopted with the substitution of current impound fees of $10.00 for first offense, $20.00 for second offense, $10.00 for each occurrence thereafJer. Second by Counci lman Amstrup. Ordinance passed its secono reading and was adopted on the fol lowing rol I cal I vote: AYES: COUNCI LMEN: AMSTRUP, NAYES: COUNCI LMEN: MANGINI, cRosBY, HARRtSoN MART I N UNFINISHED BUSINESS BOCCE BALL COURTS - WASH I Mayor Mangini questioned the status of these courts. He was informed by the City Manager that this was a [-ionrs Club project and the status of completion was not known. He noted fhat equipment for their use is available at the Recreation Deparfment, and stated he would check on this project with a report to Counci l. LIGHTS - WASHINGTON PARK BALL FIELD Mayor Mangini questioned if these I iglrlstandards, considered unsafe, had come down, as agreed af Council study meeting. City Manager informed him this would be accomplished. . BUSINESS LICENSE - D. C. MILEY JR. - 2531 POPPY DRIVE Counci lman Harrison questioned status of investigation on this matter. City Atforney repl ied information is sti I I being gathered. A home occupation business license is apparently being used for a trucking business and a possible revocation of business license may be in order. BOARD OF SUPERV I SORS Counci lman Harrison announced Board of Supervisors meeting on dissolution of harbor district at 2:00 P.M. on December 7. BART Counci lman Amstrup noted recenf newspaper publ icity concerning Peninsula Transit Alternatives Project Committee and its-representation before the Metropol itan Transportation Commission. He noted Counci I rs stand on BART 7 Jru--y',u 24f: ry ffry) and questioned if MTC had been informed of the Cityrs attitude. City Manager replied letter of objection had been written after receipt of Final Summary Report for San Mateo County Transit Development Project. He assumed this letter had been turned over to MTC. At Councilman Amstruprs request, he stated he would again communicate the Cityrs objections to BART to the MTC. CHOPE COMMUNITY HOSPITAL Councilman Amstrup stated the County Board of Supervisors would be considering Dr. George Pickettrs recommendation that this institution be turned into a psychiatric hospital rather than a general use faci I ity. The Counci lman considered Chope should be renovated and brought up to date, keeping its present use. He suggested Council go on record as supporting this purpose. Counci I concurred. City Manager was directed to send a letter supporting the present use of Chope. NORTH SAN N4ATEO COUNTY COUNC I L OF CITIES Counci lman Amstrup brought up the subject of the spring conference organization, and its proposed location at Quai I Lodge at Carmel. his objecfions for this seminar location, since it could be held i Mateo County. B. Minutes: Beautification Commission, November 4; 16; Planning Commission, November B and 22; fraftic, 11, 1976. this repeated an Park & Recreation, November Safety, Parking, November of He nS "t, J Councilman Martin, reporting as a member of the program committee for this organization, stated that a recent vote had insured this conference would be held in San Mateo Countyl , ACKNOWLEDGMENTS 1. City Manager report of December 1, 1976 on communication from lbrahim J. Kaileh, 948 Howard Avenue concerning storm drain construction on Myrtle Avenue. 2. City Manager report of December 1, 1976 on Burlingame Arts Council. 3. City Manager report of December 2, 1976 on request of M. Behravesh for walkway easement from Alvarado to Hi I lside. City Engineer told Counci I that granting of this easement would cause inconvenience to people walking to different locations. City Manager to so inform Mr. Behravesh, 1475 Alvarado Avenue. 4. Memo of November 22, 1976 from Director of Recreation explaining Special Needs Program. 5. Treasurerrs Report of 0ctober 31, 1916. 6. Letters of commendation for City Fire Department from Elsa Carlson and Mr. and Mrs. E. Mishler, 1621 Albermarle Way; Transport Workers Union of America, 1521 Rollins Road; S.M. County Regional Qccupational Program, 1845 Rol I ins Road. Letter of commendation for City Pol ice Department, San Mateo County Counci I Boy Scouts of America, 728 Crossway Road. 7. of Mayor Mangini announced adjournment of present meeting to study meeting of November B, 1916 to consider Capital lmprovement Budget and appointment of Finance Director; and to Saturday, December 11 at 9:00 A.M. in Conference Room B, City Hal l, concerning Convention Center Projecf. RECESS 3. After brief recess at 10:00 P.M. Counci I meeting reconvened. 247 CONVENTION CENTER PROJECT 1. AGREEMENT REGARDING FEASIBILITY STUDY AND DRAFT ENVIRONMENTAL IMPACT REPORT.2. A RESOLUTION AUTHORIZING EXECUTION OF AGREEMENT REGARDING FEASIBILITY STUDY AND DRAFT ENVIRONMENTAL IMPACT REPORT.3. PRESENTATION OF AGREEMENT FOR PROVIDING ECONOMIC FEASIBILITY STUDY4. A RESOI-UTION AUTHORIZING EXECUTION OF AGREEMENT FOR PROVIDING ECONOMIC FEASIBILITY STUDY Mr. Kenneth Jones of trVilson, Jones, Morton and Lynch explained to Council detai I s of documenfation I i sted above. He emphasized particular care should be taken at thi's point, since consideration is being given to entering into contractual relations with third parties. His presentation fol lows: An agreement has been prepared with Mr. Barry Silverton as a preliminary to presenting other agreements involving the City or Redevelopment Agency inthird party relationships. This agreement is to provide the City with meansof f inancing the'f irst phases of two reports. Tlfe f irst report is an economic feasi bi I ity study, by an agreement with Nationa I Feasibi I ity Corporation. The second is an environmental impact report by agreement with HKS. Both of these actions are proposed to be provided in two stages under the agreements. Direction to National Feasibility is to carry feasibility study to a prel iminary determination.' Two tests are involved in this. The first relates solely to the continued operation of the Sheraton Hotel, of primary concern fo Silverton and his group as their source of backup. That test is 'to determine if the holel will continue to produce in the f irst f ive years of operation the net profit of some $1,600,000 per year before faxes, insurance, interest, etc. The second test is of primary concern to the City, and must assure that the combined operation of the existing Sheraton Hotel and the convenf ion center facility 'i,ill produce in the next f ive years an average net income each year to 1.6 times bond service, with nef income defined to include all cost of operation, including any purchase money owed on the hotel. That test is derived from the municipal bond market. These are revenue bonds, sole security for which will be the income from the lease. ln a facility where the City has control in the form of police power, utility services, coveragetest is 1.3 or 1.5 times bond service. ln a more speculative type of revenue test - golf course, recreational faci lities- the test goes up to '1.5. Feasibi I ify study wi I I use 1.6 as a conservative measure. Deposit of $51000 is required f rom Silverton for the f irst ph'ase of feasibi lity study. Deposit of $31000 is requir:ed from Silverton for the first phase of ElR, bringing it to the point where major impacts are identified. lf the feasibility sfudy does not show affirmative feasibilityr'the project will stop. lf the EIR identif ies impacts so neg;ative and unfavora'ble fhat it will not be an asset to the Cityr'the project:will stop. A third safeguard is the agreement with Mr. Silverton which provides that he is to submit to the Council on or before the date both preliminary reports are due, data and information which will identify the people who will be acting as principals, and their financial responsibi I ity. lf the City determines these three reports are satisfactory, it must then take on the direct cash responsibility of $171000 to complete the economic feasibi I ity study. A feasibi I ity report total ly financed by the entrepreneur is worthless. lf the project is not ulfimately successful, there are two ways the City can be reimbursed for the $171000: 1. lf bonds have been issued and sold, the City can recover $17,000 from bond proceeds. 2. lf bonds are not issued, since the plan contains proviSion for tax allocation from the project area, proceeds of this allocation would be used to pay costs to the City and entrepreneur. This provision would have a fixed fee - $17,000 by the City, $14,000 by Mr. Si lverton. 7 Fr.rlffi,ffi lP-r'ry.iTr--E{t'rF, rr*{.,r:.!!6\r& 248 Tax allocation: At this point there would be an approved project area and a redevelopment plan. lf bonds fai l, that plan would sf il I exist. The Sheraton Hotel would still exist, and would have been accruing in assessed evaluation. The tax al location would get the difference between the assessed evaluation of that facility as it now stands and assessed evaluation as it accrues year by year. The tax proceeds will derive from the increment in the assessed evaluation of the hotel. lf bond proceedings are successful, the plan can be changed fo delefe the provision for reimbursement. Fol lowing Mr. Jonesr presentation, Counci I discussed Agreement Regarding Feasibi I ify Study and Draft Environmental lmpact Report. Councilman Harrison questioned Paragraph b) Page 3,tt.. the sub-lessee will agree to pay rental in an amount at least equal to debt service on the bonds plus $100r000 per year..I He'considered previous discussions had indicated at least $100,000 with the possibility of even more. Mr. Jones stated this would be oreof the elements in the conipetitive bidding for the whole package. Councilman Harrison questioned the derivation of the figure of $2,3001000 for the sublease extension. Mr. Jones stated the source was Mr. Si lvertonis lawyers and he had not yet analyzed it. Councilman Harrison questioned if it would be possible to haveamutual agreement on the sublease figure based on what might be reasonable at the time the bonds are paid off, and Mr. Jones again replied that would be an item in the bid package. Mr. Cyrus McMi I lan introduced himself as attorney for Mr. Si lverton. He stated he had a copy of the agreement signed by Mr. Silverton, and two cashierrs checks from him in the amounts of $31000'and $5r000. He explained that if there is to be a mortgage on the hotel, the lender would require that the lease extend well beyond the term of the mortgage. lf amortization of the mortgage requires 50 years, a 25 year sublease would be preferred, a I fhough the term i s negot i ab I e. Councilman Amstrup restated this as meaning the City would have to turn over control of the whole project tor 25 more years, and questioned how long the lease might be specif ically. Mr. McMillan stated he was sure Mr. Silverton would agree to 15 years. The City would get titl'e at the end of the bond period, but the lender would require this option to extend on this l.easehold mortgage. Mayor Mangini questioned if there were any indication of what the IRS ruling might be on fhe project. Mr. McMillan deferred to Mr. Jonesr opinion on this. Councilman Amstrup questioned the subleasing of rrparking areasrt as noted in Paragraph d) Page 3. He noted that some of that parking belongs to the presenf City Park. Mr. Jones replied that the existing parki0g, either for the City or the Sheraton, is not part of the project. The parking referred to is the possibility of the additional Anza parking on the south side and whatever additional parking is required for the convention center itself. Mr. Jones referred Council to map identifying the survey area, which includes a segment of Anza property located south-east of Bayside Park to be acquired as supp I ementa I parki ng. Councilman Harrison noted the survey area includes 1B parcels of land and questioned what the actual expansion of area had been from original proposal City Engineer stated the original proposal included about 4 acrds. Present proposal with these 1B lots envisions about 17 acres. Mr. Jones gave rationale for fhis additional area: Overf low parking would be needed for large conventionsi the site as it had existed would put some constraints on the design of the golf course; operation of these expanded faci I ities would produce flow of cash. Mr. McMillan amplified fhat the amount of Anza land acquired would be approximately four acres next to fhe golf course for putting in a complete /o. L *--:\: llj-.4.ie*,&i\d - :-AIJ Y-==:=q-L- . i I.! l Q r = t t! 1; {l, liL [. ='-:QS !==! g A "E-t{ l L- BID SUMMARY CITT SIbLWILK H.LPAIE. PROC,{RAM 1976.t 977 Auo"eoCo..rIr R.otrr.W. Scozr Rosr, 0.VAus,rrr.'e qe.,ts,qi.cnltrst ruc. ITEM NO.0ESCRtPTr0lr ESTIMATEO QUANTITY AMOUNT UN IT PR ICE UNIT PRICE AMOUNT U NIT PR ICE A MOU NT UN IT PR ICE AhOUNT UNIT PR ICE AiTOUfl T A ilOUilT UNI T PRIC F I . St.DE.WALK 49oo 5r.2Ao I t760e ?.c6 l3o34e9 z.7s t 3475Y 3.rs Z:15ls43ss ?-DA.IVE \A/AT I o oo5.q 2.cS 3.?.b 3.30 33oo eg 3.ooz:96,6eazcsoe2.96 =.c.UR-B lgd LF.6.00 | tOSO €7.oG t??o&(,50 ttzoe 700 ?.ootzLoE I I4SEPARATE qUTIER I oo s.n a.0s 263e 70L2e C.oo Las 5.ao 5@2L L,U7.0L E c-rrRB E (+u'?.rER.I+O LJ:9.oo I Z66qL B.5L t tgEe 9.oo tz(,0e l0.so t+7os l0.ao G t.zo t.5a ?49Q Z4aol zJ0 4NV t.a519z09SrbLwAL< q.uf F RIMoVL I 6o5E I.So I I 9.9t5'oatIl'7 ZoTY lts*V s t9,e1s8 z?,3ts"!rrr BIO OPENING OATE ' OCTOBL ZG,1976, z.'oo Pr.,\JOB NO. : 76 -Zo II1 AMOUNT ll 249 golf course and about 10 additional acres for parking. Mayor Mangini questioned how an internal transportation system would be set up. Mr. McMillan stated that the use of Anza airport shuttle buses was contemplated and that part of the plan was to move the airport parking in that direction so that it would service the center. Mayor Mangini brought up the question of the garbage disposal area. Mr. Jones replied the plan had considered the acquisition of additional lands beyond the parking to serve as a transfer station. However, this was decided to be not feasible, and all references to transfer station in the documents should be de I eted Councilman Harrison questioned if anyfhing in the additional acreage to be acquired would require relocation. Mr. David Keyston repl ied there was not. Mr. Silverton had made an offer to buy the present parking, and all facilities such as gates and fences would be relocated and the area repaved out of the proceeds of the sale. Counci lman Harrison requested confirmation that no other agency could participate in the tax increment of the difference between present assessments and future evaluations. Mr. Jones stated they could not, up to the limit of $31r000 necessary to reimburse the City and Mr. Si lverton. Councilman Amstrup questioned the present cost of the plan as opposed to the original proposal of $13r000,000. Mr. Jones $ave a figure of $1619001000. The Councilman objected to the fluctuation in plans, stating he preferred a definite, orderly proposal. Mr. Jones sympathized, but stated that a project in the conceptual stage such as this, is subjected to a certdin amount of brainstorming ideas. He emphasized that the present consideration of feasibility and EIR is a first stage preliminary to identifying a project area and specific redevelopment plan. Mr. McMillan stated that Mr. Silverton will prove good faith by putting up money and signing an agreement. He emphasized that the City has to find economic feasibi I ity, environmental impacts , and identity responsibi I ity of the entrepreneurs acceptable before they have the liability of the $171000. Also, there are provisions for recapfure of that amount. Councilman Crosby stated his understanding of this, and suggested the present position was whether to take thi's first step or to forget the project. Councilman Harrison pointed out that this might be a good project, but fhe City must have answers. He questioned if something could be done about the negotiable point of the sublease in terms of years or money. Mr. Jones repeated that the sublease, payments and extension, would be components of the bidding, but agreed that Council should discuss if it i s not acceptab I e. Councilman Harrison stated he would agree with the 15 years, but wanted a safeguard on the financial terms Mayor Mangini commented he could concur up to the point of the $171000, but was concerned about deciding on the rest of the proposal at this meeting. City Attorney noted the'language of the agreement sfates the rental shall be $100r000. He suggested substifriltion of rr... ert least $100r000...rr At this point, Mr. McMillan announced that Mr. Silverton would concede the term of the sublease option to be 15 years and the amount of rental, Page 4, line 5, of agreement, to show rf... at least $1001000...fr This met with Counci I agreement. /1. @%-l 4t4a'rt4 q,,-f.d; ,, 250 City Attorney questioned description in first paragraph of the agreement defining convention center in terms of proposals of October 20, 1976. He noted project has changed since then. Mr. Jones considered it communicated the basic structure of the project. Councilman Martin questioned why part of Bearint lndustrial Park is included in area on the map. Mr. Jones referred to City staff, since they prepared map. City Engineer pointed out that this is a survey area and the project area will be developed at a later date within this boundary. Map was designed to give the greafest latitude possible, and includes freeway interchanges. Councilman Martin quesfioned if the tax increment applies to every parcel in the survey area. Mr. Jones stated fhis survey area is shrunk down to the project area which produces the money and he did not know whether these Bearint Park parcels would be included. Councilman Martin commented that the $51,000 would be financed by a tax increase, and it didnrt seem a clean deal fo have the money come out of the taxes. Mr. Jones amplified that the increase money would come out at the ratio that the Cityrs tax rate bears to the total tax rate. Couniilman Martin estimated the Cityrs rate at about 11% of the total, and requested verification that other agencies, such as school districts, could not participate in this increment. Mr. Jones verified this, but noted that an amendment to the State redevelopment law required the impotinding of 20% of all fax incremerit values in fhe project area to apply to low and moderate income housing. Councilman Martin stated he had several concerns. He considered that in any bidding the bidder in confrol of the Shejraton would be the most likely to be successful. He insisted on revision of the contract to provide an escalation clause before he would agree to it. Also,'he thought it was time for Si lvertonrs disclosure. ln addifion, he stated he was almost adamant against the 15 year extension. He repeated he would not agree to the agreement as it is now written. Mr. Jones stated that the essence of the undertaking, which they are wanting to extract from the sublease, is the guarantee on the bonds. He noted that, of course, is 100% covered, and stated the $1001000 is really in there as a kicker. Councilman Martin declared fhat the original deal was proposed asa money maker for the City but has now become a revenue bond issue on which the City is getting $1001000 a year for 30 years, with a golf course on which the lessee gains all the revenue. He poinfed ouf thaf hotel rates will raise but the City will still get $100,000. 0riginally Mr. Silverton had said the $100,000 would I'ast only a few years and escalation had been discussed. Mr. Jones reported he had drafted the agreement on the basis of what he thought were the negotiations with the Cify, and referred Council to Mr. McMillan for further discussion of terms. Mr. McMillan told Council the amount of the mortgage would be fixed, the amount of the bonds would be fixed, payments of $100r000 and the $2,300,000 could be negotiated on cost of living increase with a feasible limit. He emphasized fhat the 15 year sublease was essential for mortgage purposes and that Mr. Silverton could not make disclosure until he had an agreement with the City. He pointed out that Mr. Silvertori must take action soon. Counci lman Harrison commented that before Mr. Si lverton had approached the City all that was considered was a driving range and golf course wifh an income of $601000 a year and no large capital outlay. He thought fhis looked like a good package but agreed with Councilman Martin that escalation was i mportant Mr. Silverton addressed the Council. The main points he stressed were that a sublease was essential, but that 15 years would be satisfactory. 0n this sublease $2r3O0,000 wou[d be for the first'!dar with an escalation after that. He suggested an escalafion based on the cost of living not to exceed 3f, per year, this increase to be evaluated every five years. He confirmed that /2, u,l ga ^.t-t.&aq .u Ji-t*-.* . 251 wording in the agreement could beffat leastrr$100,000 and the $1001000 could be escalated at 3/' a year. Mr. Silverton commented that he was taking the risk at this point, not the City; and if he showed a financial statement of $25,000,000, they had nothing to fear. He stated that the area of the project had been increased to make fhe bond'issue stronger, and noted he had been informed several hotel chains would bid. He commented that if the City wantedto put the transfer statlon back in, he would be agreeable; and urged immediate Counci I action on fhe agreement. Mayor Mangini commdnted that initially it was stated the City would own the hotel in 30 years. Mr. Silverton pointed out this was still true; there would merely be a lease for another 15 years. Councilman Harrison questioned it 3% escalation could be considered the norm. Mr. McMillan reported that it was extremely di-ffi.cult to reference rate in direct proportion to the cost of living, and most lenders will not accept actual costof living because their profit does not go up that fast. They need some maximum. Counci lman Harrison remarked that 5% seemed reasonable. At this point Councilman Amstrup pointed out that the Council had not actually had a chance to discuss this proposal as a group and most discussion had been at presentations. He suggested ful I Counci I discussion before decision. There followed some discussion of a special meeting with Mr. Silverton urging immediate action because he had brought staff from National Feasibility from out of state to start work on the feasibi I ity study. Councilman Martin stated he did not like the 3% escalation because there was no way of knowing what inflation could rise to. He suggested a clause representing a percentage of gross income or gross profit, which would protect both the entrepreneur and the City. He pointed out that when this agreement is modified, it will be the basis for the bids. Mr. McMillan agreed to negotiate, but considered that agreement could not be reached tonight on exactterms. He thought the agreement as now modified would allow for exact determination at a later date. Counci lman Martin did not agree. Mr. Silverton suggested that 3% be used initially, with a future determinationof 60% of the annual cost of I iving increase. Councilman Harrison suggested the $1001000 and the $2r3001000 be subject to negotiations. Mr. Jones agreed this could be done. Councilman Martin stated he did not consider the contract in shape to negotiateat this meeting and he would approve none of it. Council agreed to special meefing to be set for Saturday morning, December 11. Mr, Silverton declared he would not agree to a sublease of less than 15 years, and questioned what could be worked out at a special meeting that was not before the Counci I now. Councilman Martin suggested Mr. Silverton confer with his advisors and bring to the meeting suggestions on ways of effecting an escalation clause. He suggested that the period of the bonds could be reduced so that the lease extension would not be so long. He also suggested some method of providing a surplus, so that if the operation fails the City would not be placed in the position of forced sale. One method would be to have the corporation deClare no dividends for a certain period of time. Mr. Silverton indicated he would appear at the special meeting, but declared there are certain I imitations on guarantees. He noted that the National Feasibility company had been chosen by the City, not by him; and all of these points would be covered by fheif report. |lrR" f@".d r--ffiri,tT' ffit'ry"<F /3. ,E-l!T1I'"rl7K'+tr.,!{qrF ttb ,|ilrrFf*;Ersyryi.lillF4 . rffi-'?;1iq 252 RECONVENE After a short recess at 12:05 A.M., the meeting reconvened. Mr. Jones reviewed accepted amendments to the agreement as: insertrrat leastrr before $1001000 on Page 3; reduce term of sublease trom 25 years to 15 years; and insert rraf leastrr before $213001000 on Page 4. He considered that whatever final determinations are made they would not be contained in this document; and these amendments to it would serve the purpose. Mayor Mangini announced adjournment of this meeting to the.study meeting of December B, 1976, and the adjour:nment of that meeting to the special meeting of December 1'l , 19'16. Meeting adjourned at 12:15 A.M. Respectfu I I y submitted, z.i r,, ,- Z/ ZllC "Evetyn/H. Hill City 9lerk ri t+.