HomeMy WebLinkAboutAUGUST 18,1998
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CITY COUNCIL PROCEEDINGS ARE AUDIO AND VIDEO TAPE RECORDED AND ON FILE IN THE OFFICE OF
THE CITY CLERK
ROLL CAli.:
1.
2.
2a,
OVERVIEW
REDEV.
PROJECTS
GOALS AND
OBJECTIVES
0610-90
MINUTES
CITY COUNCIL OF THE CITY OF ARCADIA
and the ARCADIA REDEVELOPMENT AGENCY
REGULAR MEETING
AUGUST 18, 1998
The City Council and the Arcadia Redevelopment Agency met in a Regular Meeting on
Tuesday, August 18, 1998 at 5:00 p.m, in the Conference Room of the City Council
Chambers,
PRESENT:
Council/Agency Members Chandler, Harbicht, Marshall, Roncelli and
Kovacic
None
ABSENT:
AUDIENCE PARTICIPATION
Bob Edqley, Arcadia resident of the south part of the City, General contractor, expressed
his concern about the Live Oak commercial area, Mr, Edgley would like to see this area
included in the Redevelopment Project Area,
STUDY SESSION (TRANSCRIPT HAS BEEN PREPARED)
The Arcadia Redevelopment Agency was formed in 1968. The Central Redevelopment
Project was adopted in December 1973 and took effect in 1974, the "Base Year" for
property tax collection. In FY 1974-75, the Agency received tax increment revenue in
the amount of $13,183. In FY 1997-98, the Agency received tax increment revenue in
the amount of $2,602,600.
In December, 1997 the Agency adopted the updated Five-Year Implementation Plan
(1994-1999) and established priority projects for the following two (2) years in
redevelopment and housing,
The purpose of the study session this date was to inform the Agency Board of what the
Agency has accomplished, explain the Agency's resources and limitations, and obtain
direction as to its future objectives and projects.
EMINENT California Redevelopment Law permits redevelopment agencies to use the power of
DOMAIN/ eminent domain to condemn private property for a public purpose if the power is set forth
PROPERTY in the community's redevelopment plan, A "public purpose" includes agency acquisition
ACQUISITIONS of property for future development of commercial. industrial, and{or residential property
by a private party, as well as for more typical public uses such as city halls, city parks,
fire/police stations. low income housing, public roads. etc,
The Arcadia Redevelopment Agency's original 1974 Redevelopment Plan authorized the
use of eminent domain, In 1986, the State of California required that all redevelopment
agencies set a maximum time period of twelve (12) years for the use of this power. The
Arcadia Redevelopment Agency's power to use eminent domain expired on June 30,
1998,
Redevelopment Law permits the Agency and City Council to reauthorize eminent domain
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8{18{98
POSSIBLE
SO,UTH ARC.
REDEV,
PROJECT
AREA
40:0211
for up to twelve (12) years, The Redevelopment Plan must be amended by City I
ordinance following a noticed public hearing, Notice of the hearing on the proposed
amendment must be sent to each land owner and tenant in the project area, as well as
all taxing entities and community organizations,
The discussion of the Council/Agency centered on whether or not the power of eminent
domain should be extended or reinstituted and if so, in the entire project area or limited
to industrial and commercial properties, Following the discussion the following motion
was voted,
It was MOVED by Agency Member Chandler to DIRECT staff to pursue reinstatement of
the power of eminent domain (condemnation) and to include all project areas residential
use with the exclusion of residential properties on the north and south side of Colorado
and south of the alley south of Huntington Drive, and provide an inventory of residential
uses within the non-excluded area, which the Agency will have an opportunity to fine- ,
tune at the time of the hearing, seconded by Agency Member Harbicht and CARRIED on
roll call1/ote as' foliows: '.', '
AYES:
NOES:
ABSENT:
Agency Members Chandler, Harbicht, Marshall, Roncelli and Kovacic
None
None
The South Arcadia Business district extends along Live Oak Avenue and Las Tunas
Drive from the City border near Sixth Avenue on the east to EI Monte Avenue on the
west. There is serious evidence of blight in this area. Significant commercial properties
are vacant, and/or in poor condition due to their age and functional obsolesce,
Conflicting land uses, commercial manufacturing, residential single and multi-family, are
often adjacent to each other, .
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A preliminary study of existing conditions in the South Arcadia area was done by Keyser,
Marston & Associates (KMA) a consulting firm that specializes in redevelopment. KMA
believes significant parts of the commercial area are blighted as defined in
redevelopment law. The Arcadia Redevelopment Agency may wish to consider adoption '
of a new redevelopment project area of annexation of the South Arcadia commercial
district into the existing Central Redevelopment Project. The project adoption or
amendment process staff noted is very complex. lengthy and formal. The law requires
preparation of a preliminary plan, preliminary review and dissemination of the plan by
the Planning Commission and notice of the proposed amendment sent to all owners and
tenants in the project area, and to community organizations with an interest in the
proposed project area, Further, the owners of the property which the Agency
contemplates possibly acquiring by use of eminent domain during the next twelve (12)
years must receive specific notice of this potential acquisition, If more than seven (7)
people residing in the proposed project area may be displaced by Agency action, the
Agency must first form an advisory Project Area Committee (PAC). The PAC are
setforth in the August 18, 1998 staff report, If the PAC recommends against adoption of
a proposed plan, the Agency must adopt the plan by a two. thirds vote (4 of 5),
Considerable discussion ensued about the Live Oak/Las Tunas commercial area and the
following motion was put forth:
It was MOVED by Agency Member Chandler, seconded Agency Member Harbicht and
CARRIED on roll call vote as follows to DIRECT staff to come back to the Agency with a I
formal proposal, to amend our existing Redevelopment Project Area to include the Live
Oak and Las Tunas commercial area from EI Monte Avenue to near Sixth Avenue,
AYES:
Agency Members Chandler, Harbicht. and Kovacic
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NOES:
ABSENT:
Agency Members Marshall and Roncelli
None
PROJ Staff presented information regard potential project opportunity sites and explained the
OPPORTUNITY various marketing efforts staff has completed in connection with the Foulger Ford site at
SITES the northeast corner of Santa Clara and Huntington Drive, A mailing was done informing
the retail community across the country of the availability of this highly desirable
property, Staff also noted that staff has focused on the Bekins Storage building and the
Elks Lodge on Huntington Drive, for possible redevelopment" Staff suggested that, with
the Agency's consent, they could do an economic analysis of there two sites to
determine if there is economic value or benefit for a redevelopment project. The
Agency, by consensus, agreed to this proposal.
Self storage uses were briefly discussed, in particular, the Western Security Bank site on
East Santa Clara, affordable senior housing was also mentioned by an Agency member.
REFINANCING/ In the August 18, 1998 report staff provided the Agency with information regarding
FINANCING/ different ways of financing or refinancing existing debt and discussed this date the
DEBT advantages or disadvantages of these potential revenue sources, The possibility of
REPAYMENT bonding against tax increment to generate about $11 million in new funds for a police
facility for example, Certificates of Participalion were briefly discussed as another way of
financing, with the tax increment as a funding source to payoff the debt. Staff noted
that the funding sources outlined in the staff report were for information.., the Agency
has options since income has grown to a certain point.
3,
CLOSED SESSION
3a
Ol/CI. '10
Pursuant to Government Code Section 54957,6 to confer with City labor negotiators
William Kelly and Carol Przybycien regarding Teamsters Local 911, AFSCME Local
2264, AFFA, APOA, Management and non-represented employees,
At 6:37 p,m, the City Council/Agency RECESSED to the Closed Session which
concluded at 6:55 p.m. and RECONVENED the Regular Meeting in the Council Chambers
at 7:05 p.m,
INVOCATION Reverend Ray Petzholt, Mandarin Baptist Church
PLEDGE OF Staff Sgt. Ed Bacon, U,S, Army, Retired
ALLEGIANCE
ROLL CALL:
PRESENT:
ABSENT:
Councilmembers Chandler, Harbicht, Marshall, Roncelli and Kovacic
None
4,
PRESENTATIONS
MAYOR'S
COMMUNITY
SERVICE
AWARD (Yuen)
Mayor Kovacic presented the Mayor's Community Service Award to Annie Yuen stating
in part that throughout her life Mrs, Yuen has emphasized family, volunteerism and
humor, she is often the first person to offer help when needed and her big heart has
made her a friend to many, Mrs, Yuen is a pharmacist by trade, a wife and mother, and
an involved Arcadia resident. Mayor Kovacic noted the many associations to which Mrs.
Yuen has volunteered time and expertise, The Mayor commented Mrs. Yuen was also
recognized by the Southern California Pharmacy Guild and the recipient of the 1998
Woman of Achievement Award from the Arcadia Branch of the American Association of
University Women,
Mrs, Yuen graciously accepted the Mayor's Community Service Award and noted that
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she receives back much more than she gives to these associations,
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5.
MAYORS
EMPLOYEE
RECOGNITION
AWARD
(Casalou)
Mayor Kovacic presented the Mayor's Employee Recognition Award for this month to
Mike Casalou, Management Analyst, Arcadia Fire Department. Mayor Kovacic noted
Mike's accomplishments for the department, in particular, ,the creation and
implementation of the Paramedic Subscription Program, a low cost altemative to
supplement health insurance. In the past three years nearly four-thousand residents and
. family members have enrolled in this program, Further, Mike worked many long hours
along with other members of the Fire Department analyzing the Los Angeles County Fire
Annexation of Arcadia fire protection services to the County, It was largely due to his
efforts that it was determined that the City was providing a comparable and quality
service at a lower price to Arcadia citizens. Mike also participated in the recent audit of
the Arcadia Fire Department payroll practices procedures which proved extremely
beneficial in confirming that these matters are being handled properly, Mayor Kovacic
congratulated Mike for his positive and enthusiastic service to the public and the City of
Arcadia.
Mr. Casalou expressed appreciation to Mayor Kovacic for the recognition and to his
colleagues in the Fire Department who also worked on the mentioned projects,
6.
ARCADIA
CROSSING
GUARD
(Fischer)
Mayor Kovacic presented the Mayor's Certificate of Commendation to Frank Fischer for
his dedication to the children of Arcadia and the Arcadia Police Department for the
twenty-one years of service as a school crossing guard. Mr. Fischer said it has been
twenty beautiful years of service to the beautiful school children and he hopes to
continue for one or two more years, '
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7.
SUPPLEMENTAL INFORMATION FROM STAFF REGARDING AGENDA ITEMS
City Manger Kelly reported that Agenda Item 11 e contained a typographical error. The
figure in the staff report should read $24,144 rather than $21,144. Also, in response to
Council, the procedure to replace City vehicles is predicated upon repair costs, per mile
basis, yearly costs for labor, parts, fuel, outside services and miles driven, An analysis is
then made of what the cost would be per year for a similar vehicle,
8,
QUESTIONS FROM CITY COUNCIUREDEVELOPMENT AGENCY REGARDING
AGENDA ITEMS
In reference to Agenda item 11 e Councilmember Harbicht requested that the savings of
$23,712 in maintenance costs in the 1998-99 Operating Budget be used, rather than
appropriating $24,144 in additional funds from the Capital Improvement Fund, to cover
the maintenance portion of the contract for the Live Oak and Las Tunas Median
Modification and Irrigation Upgrade,
ORD. & RES, It was MOVED by Mayor Pro tem Chandler, seconded by Council member Roncelli and
READ BY TITLE CARRIED that ordinances and resolutions be read by title only and that the reading in
ONLY full be WAIVED,
9.
AUDIENCE PARTICIPATION
I
Staff Sot. Ed Bacon, U,S, Army, Retired, 1807 South Baldwin Avenue, stated in part that
now that the City and County fire option is over it is time that the City Council brings the
Fire Department back to its Class I status, The City Manager noted the insurance
company that does the rating could come in at any time and re-rank the department.
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However, he is not aware of anything pending at this time, Further, City staff is
discussing sharing operations. including comm,unications, with Monrovia,
Ray Whitmer, representing Teamsters Local 911, general employees and professional
and confidential City employees. On the September 1 st Council agenda a Request For
Proposals (RFP) for a comprehensive classification compensation study will be before
the Council. He understands the City has received proposals from a number of firms
that do these studies. The Teamsters wholly support such a study, it is needed because
the City's classification/specifications are very outdated, The current job
classification/specifications no longer represent the actual work that is performed by the
employees, according to Mr. Whitmer. Further, the Teamsters have three employees
who have submitted requests for reclassifications which will be addressed in the study,
which Local 911 supports,
Georqe Hanna, tenant at the Arcadia Landmark Center on East Huntington Drive, The
tenants at the Landmark Center received a letter from City Code Enforcement stating
that portable signs are not allowed on sidewalks unless the business storefront is facing
the street. The stores at Landmark Center are in back of a parking area which fronts on
Huntington Drive, The business owners on the lower level of the building signed a
petition requesting they be allowed to place portable signs on the sidewalk to draw
attention to their establishments, which would help them stay in business, Mr. Hanna
submitted the letter/petition to the City Clerk for staffs information, Mr, Hanna reiterated
the importance of this kind of advertising and that the signs would be done correctly. At
the request of Mayor Kovacic, Mr. Hanna named the other business people from the
Landmark Center who were in the audience: Mr. Nguyen, Panda Express, the bakery
owner, and a person from the sung lass shop, Mr. Hann's business is C & G Software,
Mr, Nquyen said the small portable signs that the business owners are requesting should
be placed on the sidewalk in order to be seen since two restaurants in the shopping
center block out some of the stores in the back, Mr, Hanna noted that portable signs are
allowed in some areas on the City for stores fronting the street. It is his opinion that
these establishments do not need the exposure since they can be seen from the street.
Steve Vezarian. previously requested that the City open up some property for BMX'ers
and bicycle riders to make trails and different types of dirt tracks to practice on, The
Director of the Recreation Department showed him a City property on Live Oak Avenue,
He asked Council if they had reached a decision about any property that could be used
for such an activity, Mr. Vezarian offered his time to oversee such an area if Council
would open up a property on a trial basis, Mayor Kovacic advised that Council had
received Director Collins' report... no decision has been made as yet. Mayor Pro tem
Chandler, liaison to the Recreation Commission, reported the Commission felt that the
request had merit, however the Youth Master Plan has been high on the Commission's
priority list for some time, He felt that this request should be formally presented to the
Recreation Commission for a recommendation to the Council before the Council
considers Mr. Vezarian's reques!, Councilmember Marshall felt Mr. Vezarian's plan
would cost the City very little. She could see the biking program as part of the Youth
Master Plan, Councilmember Harbicht agreed with Mayor Pro tem Chandler that the
Recreation Commission should formally consider Mr, Vezarina's request. Following a
motion by Councilmember Marshall and second by Council member Roncelli, it was the
consensus of the Council that the Recreation Commission place the matter on a future
agenda for study and a recommendation for the Council.
Mr, Vezarian added that the bike riders would prepare the track themselves at no cost to
the City,
Drew Krvnicki. 321 Leroy Avenue, stated in part, in reference to the earlier study session
overview of Redevelopment Agency projects, that in his opinion, if the Redevelopment
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MARSHALL
(FY 1997-98
Dpt. Budgets)
(Paramedic
Prog,)
.. -
(U-Turn signs
Santa Anita)
40:0215
Agency incorporates the Live Oak area into the Redevelopment Project Area, the City I
would lose more in property tax revenues than would be gained from sales tax revenue
form this area,
James Dolbeck, owner of Marketowne Liguors, 148 East Las Tunas Drive, expressed
concerns about the deterioration of the Live Oak/Las Tunas commercial area and the
many business' in that area that have moved out. He would like to see the City
intervene so that an Orchard Hardware could located on Live Oak Avenue, which has
been in negotiation with the property owners, There are over thirty-two (32) vacant
business locations on Live Oak from EI Monte Avenue to Sixth Avenue, He has been in
business in this area for two years and has seen a proliferation of homeless persons and
drug dealers during that time, He feels that the Police Department has done nothing
about these problems, He is concerned that he will go bankrupt if the City does not step
in and make this a redevelopment project area and put some pressure on the property
owners along Live Oak to close the deal with Orchard Hardware. Mayor Kovacic
requested the crime information stated by Mr. Dolbeck be forwarded to Police Chief
Gamer by the City Manager.
MATTERS FROM ELECTED OFFICIALS
Councilmember Marshall thanked all the City department heads for staying within their
budgets in fiscal year 1997-98,
Mrs, Marshall suggested that an ad be placed in the Arcadia Weekly newspaper
informing residents of the City's Paramedic Subscription Program, This ad would inform
new residents and remind others, and could increase sign-ups for the program. City
Manager Kelly commented he would look into this and noted that press releases can also
be issued on the subject,
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Regarding "U-turn" signs on Santa Anita Avenue, staff advised that Mr. Cline, Traffic
Engineer, Development Services Department, monitored this situation on the final day of
school this year and will revisit the matter when school is again in session in September.
Htg. Dr.
Downtown)
(Tenant leases - Mrs, Marshall referred to a letter received from a Huntington Drive property owner who
RONCELLI
(Town Hall
meetings)
(Qrt'ly Budget
Reviews)
has not been able to lease her building for sixteen months due to restrictions in the
Redevelopment downtown area, Council member Marshall MOVED that this matter be
placed on a future Council agenda for discussion. The motion was seconded by
Councilmember Roncelli, The City Manager noted the Agency previously debated at
length the goal for the downtown area and he did not believe a hardship problem was a
category to grant an exception to the restrictions in downtown Arcadia, Mayor Kovacic
said he would agree to have the limited issue of a hardship exception placed on a future
agenda for discussion,
Council member Roncelli said he was pleased that the idea of Town Hall Meetings was
endorsed by the Mayor and hoped these meetings would soon start. He suggested an
item for discussion could be the Redevelopment Agency, Mayor Kovacic reported the
first Town Hall Meeting will be held on Wednesday, September 23rd around the theme,
"How do we keep Arcadia a great place to live and work", A panel of residents will be
assembled and the public invited,
Councilmember Roncelli noted the expected quarterly Budget Review was not received,
He would like to review, in particular, the departments 'that were over budget for FY
1997-98, The City Manager advised the first quarterly report for FY 1998-99 would be
issued in October for the first fiscal year quarter ending September 30th,
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(City Hall Hours) Mr. Roncelli said he would like to initiate a brief discussion of the pros and cons of
reopening City Hall five days a week to better serve the citizens. The increase of
building activity merits reconsideration of this matter. Councilmember Marshall agreed.
The City Manager advised many contractors and builders are pleased with the extra
daily hours at City Hall. Mayor Kovacic commented he is satisfied with the current
schedule and would not vote for further study,
(Downtown Arc.
Bldg. Facade
Upgrade Prog.)
Council member Roncelli felt the Downtown 2000 Building Facade Upgrade Program
should come to an end since many business establishments have not taken advantage
of the program, The City Manager reported there are nine (9) business facade upgrades
currently in process, He further explained this process takes a certain amount of time
and the allocation of funds per year is limited.
(Fire Dpt. Study) In response to Councilmember Roncelli, the City Manager reported the Fire Department
and Administrative Services are meeting to go over the recommendations in the Peat,
Marwick report regarding Fire Department issues, Once the City Manager receives this
report it will be brought to the City Council.
(Public
Comments)
Mr, Roncelli thanked the persons in the audience who addressed the Council for their
interest in what is going on in the City,
HARBICHT Council member Harbicht commented on the national scene, in particular, the personal
(Pres. Clinton issues surfacing about President Clinton, and the potential fall-out that accrues to the
Personal Issues) local level. The investigation into these matters is purported to have cost $40 million so
far... Council member Harbicht noted his share of this cost works out to be 15~. Fifteen
cents for every man, woman and child in America. For 15~ the people found out that the
president is a flat out liar. Further, if anyone thinks that 15~ is too much of a burden,..
he will give it back to them, He is concerned that these revelations might undermine the
public confidence in all elected officials.., this. he feels is unfair. His motivation for over
twenty-one years in City government in two different cities is to try and make his City a
better place in which to live, He has worked as hard as he can and been honest the
entire time, Mr. Harbicht has served with a lot of Councilmembers and Planning
Commissioners during that time and has never known one who was dishonest in his
dealings as a City Council member, Planning Commissioner, or any of the other
Commissioners of the City he has come in contact with, There are disagreements now
and then but all of these people are in this for the same reason... to try and make this
City a better place in which to live and work. For the record, "I feel that the people that
I've come in contact with.., the elected officials. the appointed officials, are honest,
sincere, hard working people who are not lying to the citizens, We're doing the job that
you elected us to do and I hope that you will give us the benefit of the doubt and not
paint us with the same brush as I hear these comments, 'Well, they're all a bunch of
crooks'.., and that is not the case."
(Freeway
Signage)
Os-"'. ,5'0
AIr,
In reference to the City securing a cooperative effort to put up on freeway signs that
would feature several City business', the City Manager reported the cities of Arcadia and
Monrovia formed a "HotellRestaurant Group", Arcadia staff discussed with them one
sign.., several signs, it is up to the group to decide an area name and the kind of
signage, An update will be forthcoming of where this group stands.., then staff will
infonn the Council of the role Arcadia will play. The emphasis was to make it the groups
project, not the two cities. Council member Harbicht expressed concem that Arcadia
signage regulations do not permit signs over a certain height and the City's new hotel
and other hotels in that area do not have signs with freeway exposure as do the new
Monrovia hotel and the new restaurant, the "Macaroni Grill', Mr. Harbicht noted the
competition between the hotels and feels that perhaps the City signage policy is too
restrictive for the hotels that are near or adjacent to the freeway, He would be in favor of
something like a "Freeway Zone" which would allow taller signs for the Arcadia hotels
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40:0217
along the freeway.., or at least take this possibility under advisement. The City Manager I
' reported this code change is in process.., Council will soon receive an update on this
matter.
KOVACIC
(Volunteers)
Mayor Kovacic reported that Nancy Miner, Senior Citizens' Commissioner, felt the bus
bench at the Assistance League House should have a cover. He since learned that City
staff are looking into a Citywide program for such a project, however, the City is many
months away from implementing such a program. In discussion with some parents of
scouts, a prospective Eagle Scout, Jeremy Conrad, suggested, as a project for his Eagle
Scout award, to build a cover for the bus bench at the Assistance League House. As a
result of this, Mayor Kovacic sent letters to all the City's boy and girl scout leaders
advising them that the City is always in need of community service project and would
appreciate their help.., this would extend to all the service clubs in town or at the high
school. The Mayor suggested any interested club or person telephone the City
Manager's staff if they would like volunteer.
11.
CONSENT ITEMS
11a.
MINUTES
(July 30 and
Aug, 4,1998)
11b. () ~~O _6 c)
FINAL MAP OF APPROVED The Final Map of Tract No, 52311 for a 5-unit residential condominium
TR, 52311 (333 project- at 333 California Street, provided that prior to recordation of the tract map any I
Calif. Sl. 5-unit outstanding conditions of approval are' complied with to the satisfaction of the City
res. condo.) Engineer.
APPROVED the minutes of the July 30, 1998 Joint Meeting with the Sierra Madre City
Council and the August 4, 1998 Regular Meeting,
11c. O~;(5fj ~O
FINAL MAP OF APPROVED The Final Map of Tract No. 52393 for a 6-unit residential condominium
TR. 52393 (6- project at 167-169 EI Dorado Street, provided that before the final map is recorded all
unit res. condo, outstandig conditions of approval shall be complied with to the satisfaction of the City
167-169 Engineer.
EI Dorado Sl.)
l1d. (J/.?:) ,'. d
RESOLUTION ADOPTED RESOLUTION NO, 6066, entitled, "A RESOLUTION OF THE CITY
NO, 6066 COUNCIL OF THE CiTY OF ARCADIA, APPROVING THE DESTRUCTION OF
(PD Records) CERTAIN POLICE DEPARTMENT RECORDS, DOCUMENTS, AND PAPERS,
PURSUANT TO SECTIONS 34090 AND 34090,6 OF THE GOVERNMENT CODE OF
THE STATE OF CALIFORNIA:
11e.
AWARD See Page q,
CONTRACT
(Live Oak and
Las Tunas
Mediansl
Irrigation)
11f, t). i -'It)....J ()
EQT, AWARDED a contract for the purchase of four (4) 1998 Ford Crown Victoria Unmarked I
PURCHASE Police Interceptor 4-Door Sedans to Robert H, Loud Ford in the amount of $90,796,30;
(PD Interceptr, WAIVED the formal bidding process and piggy-back the City of Pasadena bid and
Sedans - Pasa, AWARD a contract in accordance with Recommendation 1; AUTHORIZED The City
Bid) Manager to EXECUTE a contract in a form approved by the City Attorney,
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11g. t).J'k .,':j
EQT, WAIVED the competitive bidding process and piggy-back the City of Los Angeles' bid
PURCHASE and AWARD a contract for the purchase of four (4) 1998 Ford Crown Victoria Police
(PD Interceptr, Interceptor 4-Door Sedans to Robert H. Loud Ford in the amount of $94,595,40;
Black & White AUTHORIZED The City Manager to EXECUTE a contract in a form approved by the City
Sedans LA, Attorney,
Bid)
11h, 0 ?\I'th ()
EQT, AWARDED a contract for the purchase of one (1) 1998 Ford Ranger Super Cab 1/2 Ton
PURCHASE Rear Wheel Drive Pick-up Truck to Robert H, Loud Ford in the amount of $16,446.40:
(PD Pick-up AWARD a contract to Advance Concepts and Design Inc" for the installation of right side
Truck w/Rt. Side steering assembly for $4,560,00; WAIVED competitive bidding process and piggy-back
Stmg, Monrovia the City of Monrovia bid and AWARD contract in accordance with Recommendation 1
Bid) and 2; AUTHORIZED the City Manager to EXECUTE a contract in a form approved by
the City Attorney.
11i.c)'),.fJ,S'O
ACCEPT PROJ, ACCEPTED project for work performed by General Pump Company as complete for the
(Rehab. Rehabilitation of Orange Grove Well #6; and AUTHORIZED final payment to be made in
O,G.Well #6) accordance with the contract documents subject to retention of $3.958,
11j, o <7...U.
AWARD
CONTRACT
(Rehear. Live
Oak & 1st Ave,
Job Nos.
1996-97-1
1997-98-2)
1'-0
AWARDED a contract to E,G. Construction, Inc, in the amount of $229,430.80 for the
Rehabilitation of Live Oak Avenue from EI Monte Avenue to Santa Anita Avenue; and
First Avenue from Colorado Boulevard to Foothill Boulevard - Job Nos. 1996-97-1 and
1997-98-2; WAIVED all informalities in the bid process; AUTHORIZED the City Manager
and City Clerk to EXECUTE a contract in a form approved by the City Attomey,
ALL OF THE ABOVE CONSENT ITEMS 11a, b, c, d. f, g, hand i APPROVED ON
MOTION BY COUNCILMEMBER HARBICHT, SECONDED BY MAYOR PRO TEM
CHANDLER AND CARRIED ON ROLL CALL VOTE AS FOLLOWS:
AYES:
NOES:
ABSENT:
Councilmembers Chandler, Harbicht, Marshall, Roncelli and Kovacic
None
None
11e. ~(II? V.'
AWARD Consideration of the report and recommendation to award a contract to Golden Bear
CONTRACT Arborists, Inc, for the Live Oak and Las Tunas Median Modification and Irrigation
(Live Oak and Upgrade,
Las Tunas
Median Mod.! Following a brier' discussion it was MOVED by Council member Harbicht, seconded by
Irrigation Upgrd, Mayor Pro tem Chandler and CARRIED on roll call vote as follows to AWARD a contract
(APPROVED) in the amount of $102,9'44,00 to Golden Bear Arborists, Inc" for the Live Oak and Las
Tunas Drive Median Modification and Irrigation Upgrade, BaldWin Avenue to Santa Anita
Avenue; SUPPLEMENT the original budgeted $24,144 in Capitai Improvement Funds
with the $23,712 savings in Maintenance Costs - 1998-99 Operating Budget; and
APPROPRIATE $432 in additional Capital Improvement Funds to complete the project;
AUTHORIZED the City Manger and City Clerk to EXECUTE a contract in a form
approved by the City Attorney.
AYES:
NOES:
Councilmembers Chandler, Harbicht, Marshall, Roncelli and Kovacic
None
9
8[18/98
40:0219
Mayor Kovacic and Councilmember Roncelli requested staff provide information
regarding tree trimming procedures within the City by West Coast Arborists,
I
ABSENT: None
12,
CITY MANAGER
12a. 0,.') :(0, 6 '2
RECRUIT/FILL Consideration of the report and recommendation to authorize the Maintenance Services
POSITIONS Department to fill six full-time positions: One Street Superintendent, two Public Works
(St. Super.:PW Formen and three Maintenance Workers in the Water Distribution Unit. Staff also
Foremen, Maint. requested authorization to fill vacancies that may result from possible intemal
Wk'rs etc., promotions related to the stated recruitments, All requested positions are fully funded
PD Officers & through appropriations in the 1998-99 Operating Budget. The Maintenance Wor1<er
Rec. Clk.) positions are wholly funded through the Water Enterprise Fund,
(APPROVED)
The Police Department currently has three vacant police officer positions and one
records clerk position, All four positions have been budgeted in FY 1998-1999, staff
requested authorization to fill these vacancies,
Following the staff report considerable discussion ensued concluded by the following
motion:
It was MOVED by Mayor Pro tem Chandler, seconded by Councilmember Harbicht and
CARRIED on roll call vote as follows to AUTHORIZE the Maintenance Services Director
to fill the positions of one Street Superintendent, one Public Wor1<s Foreman- I
Greenscape Unit; one Public Works Foreman-Street Sweeping Unit and three
Maintenance Workers in the Water Distribution Unit; and fill two other possible
"vacancies in the Maintenance Services Department; AUTHORIZE the Chief of Police to
fill the three police officer positions and one records clerk position,
AYES:
NOES:
ABSENT:
Councilmembers Chandler, Harbicht, Marshall, Roncelli and Kovacic
None
None
12b, /0 ~- v
PROF. S'va),
AGREEMENT
(L.e;JisIative
Ai:toJocacy Svcs.)
(APPROVED)
("II,)
Consideration of the report and recommendation to enter into a Professional Services
Agreement with Joe A, Gonsalves & Son for legislative advocacy services. In many
cases, State legislation has a direct impact on cities. In the past this impact has not
always been positive and has sometimes resulted in money being taken away from cities
and/or the institution of unfunded mandates, In an attempt to become more involved in
the State legislative process and better informed on the multitude of legislative bills
being propose, staff recommended that the services of a legislative advocacy be
retained on behalf of the City,
The funds to utilize the services of Gonsalves & Son for a trial period of one year are
available in the adopted fiscal year 1998-1999 budget, divided as follows: $8,000 from
the Redevelopment Fund, $8,000 from the Water fund and $20,000 from the General
Fund,
Following discussion, it was MOVED by Councilmember Harbicht, seconded by Mayor
Pro tem Chandler and CARRIED on roll call vote as follows to AUTHORIZE the City I
Manager to enter into a Professional Services Agreement with Joe A. Gonsalves & Son
in the amount of $36,000 for legislative advocacy services, subject to approval as to
form by the City Attorney,
10
8[18[98
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12c.
POST HOLJDA.Y
ST. SWEEPING
~IIQ
V'If'PROVED)
O-/,;)(}~~\
40:0220
AYES:
NOES:
ABSENT:
Council members Chandler, Harbicht, Marshall. Roncelli and Kovacic
None
None
Consideration of the report requesting post holiday street sweeping procedures and
potential altematives, At the August 4, 1998 regular meeting, the City Council requested
that staff provide information on the present street sweeping program schedule and to
investigate alternate scheduling procedures for street sweeping following holidays, Staff
identified four alternatives for consideration of the Council
Each year City street sweeping crews clean approximately 14,400 curb miles of City
streets, Between the months of February and October each residential street is swept
twice a month. During the months of heavy leaf fall, November through January, each
residential street is swept on a weekly basis, Members of the street sweeping crew work
eight-hour shifts, five days a week, There are ten (10) recognized holidays for all
members of the American Federation of State, County and Municipal Employee
(AFSCME) of which the street sweeping crew are members, Newco Waste Systems
observe six (6) major holidays and adjusts their refuse collection within the City
accordingly. Newco observes New Years Day, Memorial Day, Independence Day, Labor
Day, Thanksgiving and Christmas,
A concern raised at the August 4th Council meeting was that following a holiday the
street sweeping schedule often conflicts with the refuse collection schedule, This
situation occurs because the refuse contractor shifts its route schedule backwards one
day and then continues collection on Saturday to make-up for the day that was missed
due to the holiday, When the refuse contractor alters its schedule this results in refuse
containers being left at the curb when the street sweeping vehicles are scheduled to
sweep causing the street sweepers to sweep around the containers, resulting in areas of
the street not being swept. Another area of concern was that because a significant
number of holidays fall on Mondays, areas normally scheduled for sweeping on these
days are not swept as frequently because other daily schedules cannot be completely
resolved in a cost-efficient manner,
In the discussion Council agreed that, of the four altematives staff presented, Altemative
III would be the most beneficial to the community, Under Altemative III the additional
cost per year to the City was listed at $5,700, Nine City holidays remain to be
recognized by the refuse contractor this fiscal year amounting to approximately $5,130,
It was MOVED by Councilmember Harbicht, seconded by Mayor Pro tem Chandler and
CARRIED on roll call vote as follows to IMPLEMENT Altemative III to alter the post
holiday street sweeping schedule to coincide with the refuse collection schedule and add
ten (10) extra sweeping days a year to cover all City recognized holidays; and,
APPROPRIATE $5,130 from the General Fund reserve to the Street Sweeping
Operating Budget for implementation of this altemate,
AYES:
NOES:
ABSENT:
Councilmembers Chandler, Harbicht. Marshall, Roncelli and Kovacic
None
None
12d, e; P
ARC. CHI\.o1BR. Consideration of the request to approve the FY 1998-99 agreement for services with the
COMMERCESVC,Arcadia Chamber of Commerce, The Chamber of Commerce assists the City with
AGREEMENT economic development and marketing activities pursuant to an annual Agreement For
(FY1998-99) Services contract. The Chamber's report on their performance under the FY 1997-98
V'If'PROVED) contract was attached to the August 18, 1998 staff report, The Chamber requested
11
8/18/98
40:0221
tem{Agency Member Chandler and CARRIED on roll call vote as follows to AUTHORIZE I
the City ManagerfExecutive Director to EXECUTE the Agreement For Services for FY
1998-99 with the Arcadia Chamber of Commerce, subject to approval by the City
Attorney{Agency Counsel as to form,
AYES: Councilf Agency Members Chandler, Harbicht, Marshall, Roncelli and
Kovacic
NOES: None
ABSENT: None
ADJOURNMENT At 9:16 p.m, the City Council ADJOURNED to 6:30 p.m" Wednesday, August 16, 1998,
(Aug. 26, 1998) at the Arcadia Community Center, 365 Campus Drive, for an Adjoumed RegUlar (Joint)
Meeting with the City Council of the City of Sierra Madre.
ATTEST:
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8{18f98
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TRANSCRIPT
(Insofar as decipherable)
RELATING TO
A REGULAR CITY COUNCIL AND REDEVELOPMENT AGENCY MEETING
AUGUST 18, 1998
I
AGENDA ITEM NO, 2a,
OVERVIEW OF REDEVELOPMENT AGENCY PROJECTS, GOALS AND OBJECTIVES
I
ARCADIA CITY COUNCIL AND REDEVELOPMENT AGENCY MEETING AUGUST 18. 1998
OVERVIEW OF REDEVELOPMENT AGENCY PROJECTS, GOALS AND OBJECTIVES
Agency Chairperson Gary Kovacic:
We move on to item No, 2 which is the Study Session, Mr. Kelly,
City Manager William Kelly:
Mayor and City Council I am not gonna talk a lot tonight I do not want to spread my cold germ,
the presentation tonight is fundamentally to bring the new City Council up to date on where we
were and where we are going and Don Penman will go over that with you as well as giving
specific recommendations on activities, projects, properties we think we should go fOlWard in
terms of the next generation of redevelopment in Arcadia, prior to Don speaking I would like to
have the City Attorney introduce the Agency to the City Council.
City Attorney Mike Miller:
Thank you, I am going to introduce Mr. Stephen Deitsch, who represented the Agency since
1985, He is with the Law Firm of Best, Best and Krieger, he has represented Redevelopment
Agencies throughout the California and frequently a guest speaker on Redevelopment Agency
Seminar Programs and Steve has a good background with the agency since the year 1985 and
worked very closely with the staff and various Agency and City Council members, thank you,
Okay Don,
Assistant Executive Director, Redevelopment Agency Don Penman:
As the study session I like to try to keep this as formal as possible and encourage questions as
we go along because I think that will help facilitate as good discussion about Redevelopment.
We provided you with lot of material, it woutdn't be my intend this evening to go through every
piece, you know, page by page, but to provide an overview of what we provided you. There are
some areas where we are seeking some specific directions in terms of Agency activities, So with
that, I think probably one of the fundamental questions is why Redevelopment? what does it do?
what is its purpose? and I think the fundamental answer to that is that Redevelopment is an
economic development tool to help create value in a community, and one of the things that it
specifically does is eliminate blight. It is not in and of itself design to generate revenue, revenue
is a by product of a successful redevelopment program, but it is a tool that is used to help
promote economic development in a community to create jobs, it is again revenue generation
could be by product of that if it is a successful program, I think what happens in many
communities that have had problems in where there are perceived abuses they look at revenue
generation as the primary goal of redevelopment, in another words go out there try to get the
sales tax, so therefore we gonna go after the big box, and that is our goal, whereas revenue
generation certainly, it is one of the important benefits of redevelopment that, bur it is to
eliminate the blight and create value and economic development in the community,
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Council/Agency Member Gino Roncelli:
How do you grade yourself? or how would you, after a project is over, how would you decide it
was successful or unsuccessful?
Mr. Penman:
Sure, I think when a project is formed, the plan has to identify a number of goals and objectives
and what the project is designed to do, is the project for larger project area, and then when a
specific project is developed, I think when you develop that project one has to look at what are
intending to do here? what are our goals and objectives, the project I think is real important to
understand, a project does not always pencil out in terms of the economics, there are a lot of
other factors that can go in to a project in terms of does it make sense, it eliminates blight, it
might serve as a catalyst for other developments that occur without the redevelopment project is
successful, then possibly the future projects might need less and less assistance, so each project
really has to stand by itself and when you analyze a project in terms of has it been successful, it
depends on the goals that were established to begin with, why are we doing this project? What
are we trying to accomplish? But clearly it has to be to eliminate blight , but it could be to
assemble property, so that we can do a project that can create jobs in the community, that can
create some economic value so then it might enhance development opportunities for
neighboring properties,
Member Roncelli:
How would the public grade that, I mean is there a way of....
Mr. Penman:
Well, I think the public, you know, the process of redevelopment for the most part is an open
process, clearly when we meet with a property owner, that is not a public process, but when we
take a project to the Council, all the economics are spelled out, the goals and objectives are
spelled out and then the public has an opportunity to really look at that and say, we agree or
disagree with that before hand and then after the fact to see if it did what it was suppose to do, I
mean, did it accomplish the goals and objectives that the Redevelopment Agency set out when
they undertook that project, did they achieve, attract the kind of tenants they wanted or the kind
of development, the quality they wanted, any number of variables and I might be jumping a little
ahea~ of myself a little bit here, but a good example could be the Outback project for example.
The City and the Agency, in fact I don't have the numbers right in front of me, I have them
somewhere in my report here, put a lot of money and project sold it to the Outback for less than
what we paid for it, we could have sold it to a fast food restaurant for more money. now one has
to make a value judgment, which is the best, is it better to sell it to maybe a, sit-down dinner
house for less money as oppose to something that it might generate more immediate income.
What are we trying to accomplish with that? One might say the same thing for the possible with
Angels, it is a site that has been sitting vacant for a long time, We don't allow fast food
restaurants with dirve-throughs at that location, but I can assure you if we did we would probably
2
get plenty of inquiries from the fast food restaurants who would love to do a drive-thru there, We
have to evaluate what our goals are for that site.
Member Roncelli:
So, I mean having Outback there, is better than In N Out or better not said In N Out.
Mr. Penman:
A fast food,
Member Roncelli:
A fast food, I understand that, but the economics from what I understand doesn't pencil at all,
and I guess we have to live with the value of having that in town rather than something else that
wasn't worth the differences, is that what you are trying to say?
Mr. Penman:
Exactly, and that is a judgment that Council has to make each time a project is looked at, in
terms of, does this make sense for us? Are we going to do this project knowing what the
alternatives are,
Member Roncelli:
Well, Outback make sense? I guess that is the question,
Mr, Penman:
Are you asking me?
Member Roncelli:
Yes, you used that example I
Mr. Penman:
I think in terms of whether it was on Outback or a MacDonalds, I say Outback is a better deal,
because I mean, in terms of the quality that it brought and hopefully then the spin-off effects for
other restaurants and businesses in the area,
I
Member Roncelli:
Is win-win an objective? And a better place, and yes get pencil both,
Mr. Penman:
Absolutely.
Member Roncelli:
Okay, that would be more of a goal, that would be more of a goal.
Mr. Penman:
I dearly sure, I mean, probably the hotel deals were the Embassy Suites, I think we give the
economics, not only did buy the land, we sold it to them for more than we paid for it plus the
T.O,T (Transient Occupancy Taxes) it generates is wonderful so, I mean, that is probably you
have a continuum of projects of what's the absolute very best, that would be at one end, we
actually sold the land at fair market value, we have to sell it at fair market value I think, is that I
right Steve?
Mr. Deitsch:
Either that or? fair value it's done an appraisal, whichever is lower can be done.
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Mr. Penman:
Right, that would be clearly a win-win, but unfortunately they're not always quite that simple, but
that would be a goal. So, I think you know from a redevelopment stand point we look at a
number of facts not just doing big box, doing lots of money, you know, for the Agency or for the
City, we look at eliminating blight, a number of things, we provided a lot of information, staff
report, about some of these projects, I don't want to really go into all the detail, but most of the
Hotel projects I think we provide lot of information on the revenue that they generated and my
assessment is that those were successful projects, so,, they generate lot of T.O.T tax, about
eighty five (%85) percent of our Transient Occupancy Tax or "Bed Tax" is come from
redevelopment projects, we eliminate a lot of blight, people can remember back what those sites
looked like prior to redevelopment. It brought a lot of restaurants in there, generate some sales
tax to the area, and then one of the things that's tough to quantify though is generating revenue
from those people that come to those Hotels that we do not know where it's spent, I mean if a
business person is here for a weeks, staying in the Hotel, they may go to the Mall and may go to
other places and spend their money, so, I think those projects generally speaking I think would
be hard to argue with their success. and we have provided some information economics of
those in the in the staff reports, and we've actually listed all the projects in a matrix in there of
all the uses that have come about from that redevelopment. I think it is important to understand
when, a project like that is under taken it is a very complicated process not one that we've done
quickly, I think probably the North west corner property where we, got a development disposition
agreement on Hilton and Marriott is a good example, there have been lots of starts and stops on
that project, negotiating with Hotel the deal falls apart, negotiating with the new potential
property owner the deal does not work, and keep working, probably the Agency could have set a
lower standard revolt for another use in that location, maybe industrial business which would
generate jobs, maybe not the tax revenue that the hotels would generate, so, but the point is
there is a lot involved a site, starting from the marketing of it, doing an analysis of what potential
users will go there, certainly it does not make sense to have a four acre site and then say we're
gonna get a Price Club there, because obviously we know it is not going to fit there.., we have to
look at what the market really can bring to that site, once you have done that, identify developer,
we would typically enter into what is called ERN exclusive right to negotiate with somebody, so
somebody will have the opportunity to do more detailed analyses, which could lead to
development disposition agreement, or in the case of an owner who wanted to develop this site,
an OPA or owner participation agreement, we have to do environmental work in terms of sequa
we have to do environmental work in terms of toxic, we have to do appraisals, there is a real
detailed process under the law, that we have to follow when we do a appraisals that the property
owners have the opportunity to meet with appraisers, we have to appraise fixtures, furnishings
and equipment, we have public hearings, we have relocation expenses, I am just mentioning that
very briefly, that these projects are very complex, sometimes it can take years, or even if you
have one user it could take up to two years to develop that project by the time you go through all
4
that, there is a goodwill issue which has to deal with the amount of business income generated
from business versus if they relocate to another location there is goodwill appraisals, there is a I
lot of detailed work which if you are interested Steve can provide more information on that, but it
is a very complicated involved process and we have undertaken that three of four times in doing
projects in that area.
Having that as kind of a overview a little bit about where we have been, what the purpose of
redevelopment is, now I can just talk about a couple of things that we are seeking some direction
from the Council on, or pardon me, Agency Board this evening that is the matter of eminent
domain property acquisition and then a possible project area amendment, I would like to go into
the first item on eminent domain as we informed the Board in the past the Agency's power of
eminent domain expired on June 30, the law I believe indicates we could have a twelve (12)
years cycle and that twelve (12) year cycle expired and what we are asking tonight the Agency
Board previously directed they wanted to include that back into project as one of tools we have,
but with new Council and Board we want to reaffirm that direction and what we are
recommending is that the Agency Board give us a direction to initiate that process to do an
amendment that would reauthorize eminent domain for an additional twelve (12) years. Now,
historically it is very interesting, eminent domain does have certain connotation that creates lot
of concern with people, but my understanding in all the projects we have done we never had to
go all the way to court on an eminent domain case, and yet we've assembled dozens of
properties through these projects, what eminent domain dose, is a tool that brings basically a I
level playing field to the negotiation process, The Agency by law has to pay fair market value or
reuse value, clearly there is always differences of opinion over what a persons property is worth
so, we would do the appraisal we would make an offer that the property owner might disagree,
they might submit their own appraisal information, we might negotiate and negotiate and just got
no, not getting anywhere and then we might initiate an action requesting Council to adopt a
Resolution necessity and start the process toward condemnation, but the Agency has never had
to use the condemnation powers, so you might say why even have it? but without it, it makes it
virtually impossible to assemble large parcels, a large group of parcels, to do a redevelopment
project, so, we are suggesting that we need that tool to be effective and as we go in to some of
these projects later that we think are opportunity sites in the downtown where there are multiple
ownership's, we think that is the reason you see multiple ownership's that you could take one
property owner for example, we have one site that we are looking at there is literally there a
silver of undevelopable land but it is separate through title property, and it makes perfect 'sense
to include in a project but without eminent domain, this person literally could refuse to sell and
the whole project could be in jeopardy, so we think it is a tool that's important if you are going to
have an effective redevelopment program, even though the City has been very conservative has
not had actually go all the way to court in terms of its process and maybe I like to digress a little I
bit in terms of characterizing Arcadia, I work for four cities, Arcadia really is a pretty
conservative Redevelopment Agency, For example our debt to the City Six Million ($
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6,000.000) when we payoff, when we receive the proceed for the sale for Hilton Marriott Hotel,
that will be $ 2,1 million, the City will get to reduce it to $4,0 million, our overall Agency debt is
very low, for example Covina has Eighty million dollars (80,000,000) in Agency debt, Monrovia is
about somewhere between thirty five ($35) and forty ($40) million, so Arcadia generally is a
pretty conservative Redevelopment Agency as redevelopment agencies go in terms of how we
approach the projects, the amount of debt we incur and I think that has been evident through our
property acquisition procedures in the past. So, on that subject what we are suggesting is that
the Agency give us direction to go ahead, initiate the process to do an amendment to reauthorize
the use of eminent domain, and we will be happy to discuss that with Steve and talk about the
process of that , it is a real involved process, all the property owners have to get letters be
informed about there is that potential that the property could be, acquired and there will be full
public hearing process and opportunity for anyone affected by it to participate in that process,
and if did include significant number, I am not sure significant five or ten residential properties,
still there would have to be a Project Area Committee where these people have a chance...
regular ongoing committee where they would have a chance to participate in the process.
Member Roncelli:
Is this really current in redevelopment area or -------?
Mr. Penman:
Yes, well, both, when the project was formed initially the PAC requirement where not in place so
we do not have to comply with those, but now we are going to reinstitute the power of eminent
domain we have to comply with the laws that exist today, so if we reinstitute it the eminent
domain powers Council that means if they approve those, the residential properties that apply to
they would have to form a PAC,
Member Harbicht:
Are there residential properties within the project area, significant enough to cause a PAC to be
formed
Mr. Penman:
Yes, based on the current project area, yes.
Chairperson Kovacic:
If I could just correct one statement you made Don, you said the City had never resorted to the
power of eminent domain, I think you misspoke, law suits have been filed in the domain actions
to prior property it just no action has done on the trial and all been settled before trial.
Mr. Penman:
I believe that is the case, you are right.
Chairperson Kovacic:
So, we have in past adopted the Resolutions of necessity filed in domain actions, got in the court
and some point before trial settled up with the property owner,
Council/Agency Member Roger Chandler:
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I might add just for the benefit of others, Bob and I were on City Council from 86 to 90 that was
involved in the use of eminent domain, basically to redevelop East Huntington Drive, basically I
the Hotels and everything on South side and Souplantation and all those restaurants, anyhow, if
we did not have the tool of eminent domain at the time and we were committed to using it all the
way we would never have been able to do that, what so ever it would have been virtually
impossible, and at the time if you recall there were old City Motels there, there was prostitution,
there were a lot of little rental houses in there, it was really a badly blighted area and nothing
happened quick there and we went back and forth with lawyers, and finally it was solved out of
court but, my only comment was, that it was not that distant that we actually use that tool and
without it we're dead in the water that is the power of government, if it used this properly it can
bring a better benefit for everybody,
None of you guys were here, but we have been in redevelopment eminent domain usage in other
cities,
Chairperson Kovacic:
Okay, I guess the question being posed by staff is whether we want to extend the power of
eminent domain or reinstitute the power of eminent domain, both I guess initially on the existing
redevelopment project area and then potentially any other project area that we talked about, I
guess the question is whether we discuss that now or wait for the entire presentation to be made I
before we come to some conclusions, one way or the other,
Member Harbicht.
What is their pleasure, how does staff view this?
Mr. Penman:
Well, I think maybe we should go through the whole thing because it might tie in some of the
opportunity sites that we have identified where there might be multiple parcels and also with the
south Arcadia area, so we can walk through this and then kind of address....
Chairperson Kovacic:
I have one question.., go ahead Gino, I am sorry
Member Roncelli:
Maybe you can tell'me where the residents are in the redevelopment area...
Mr. Penman:
Surely.
Member Roncelli:
Colorado..
Mr. Penman:
Yes, the vast majority of the are in the area north of Colorado area.. yes 28.., if you look toward
Santa Anita the north end near North of Colorado that is where the vast majority of residents are I
Member Roncelli:
This is the....
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Mr. Penman:
There are a few scattered residents.... now, that is one of questions, you will certainly have the
option saying well, in this one particular area for example Colorado we do not want it because we
do not invasion a project where we want to go to acquire those,
Member Roncelli:
Did you take that out of the redevelopment area.
Mr. Penman:
Well, I do not know, Steve
Mr. Dietsch:
But it is very difficult when you have outstanding bonds as we do here, you have to make
findings or have a financial consultant make findings by removing property, you are not
preventing bond holders from having a source ...
Chairperson Kovacic:
Steve can we exempt properties from eminent domain,
In fact there is a provision in health and safety code to do that
Mr. Dietsch:
Absolutely, there are may allernatives many options you can pursue in that regard, keeping
within the project area, but leaving the use of eminent domain perhaps to commercial industrial
properties or maybe only along the certain intersections in major streets, perhaps something like
that, so you do have options,
Mr. Penman:
So, we do not have to include jf you want to consider; considering that authority in that
residential area,
Mr. Dietsch:
Because, I would think that gets pretty costly,
Mr. Penman:
well, it is something ----- goal you see, that is the area that we want to look at it in terms of
clearing that out. There are few other scattered areas the main one that I can think of it is on
Fifth Avenue right in the border of Arcadia and Monrovia there is a twenty unit apartment
complex, that is in commercial industrial area, that is one that...
Member Roncelli:
If we ever bring it back in, lets say you said residential are out, can you later on say now we
decided it is in....
Mr. Dietsch:
Yes, you will amend your plan again, and do a public hearing process, and perhaps add back the
power of eminent domain to the property that you originally excluded from that power,
Member Roncelli:
That might require a PAC
Mr. Dietsch:
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Yes.
Member Roncelli: I
So, that suppose to be the whole process again, it is not just a hearing.
Mr. Dietsch:
The whole process if, by the amendment itself a significant of substantial member of low or
moderate income families might be displaced, by the readoption of eminent domain or that new
area,
Chairperson Kovacic:
I have seen redevelopment plan that exclude the power of eminent domain to all residential,
units which may be appropriate at least for the parcels North of Colorado, for something like off
of Fifth, it is right in the middle of potential development area and that becomes a question
whether you want to exempt...
Member Roncelli:
It that residential?
Chairperson Kovacic:
it is residentially used.
Mr. Penman:
The zoning is for commercial
Member Roncelfi:
It is commercial......so as long as it's being used residentially you have to have a PAC. I
Mr. Dietsch:
Well, as long as it is possible the substantial number of lower moderate income families might
have to be relocated, even if they are in nonconforming.., And your standard by the way, could
be to exempt all residential properties from eminent domain or non-conforming could be subject
to eminent domain, but conforming residential not subject to eminent domain, things like that are
possible..
Member Harbicht:
If we were to exempt that property along Fifth, would that also prevent us from using friendly
condemnation there?
Mr. Dietsch:
Yes, if you do not have the authorities or the redevelopment plan for the specific site, you could
not even have friendly condemnation, you have to have end of the line authority to condemn,
Member Chandler:
Steve, for the clarification, condemning residential is not necessarily as costly as condemning
commercial is it? it seems to me with commercial businesses were the ones we really got
hooked, you know, with Goodwill, and all that relocation and all that it seem to me we had
several residential that were part of the condemnation process and they were relatively cheap, I
So, please clarify that for us here.
Mr. Dietsch:
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It might be, it all depends on of course, on nature of the property, Some commercial property
can be sub-de-valued bad shape, or its cheaper, ----------- some residential property can be may
be not so bad m__ and could be little bit more expensive, but on average maybe lot by lot
residential property in the redevelopment project area which is blighted might be a little cheaper
than commercial or industrial property....
Member Chandler:
I might say, last time we did this, that was the cheaper at the end of the deal.
Member Harbicht:
The question really is not what will be the cost, it is what process we should go through to re
institute the right condemnation if we include residential property,
Chairperson Kovacic:
If I can follow up on Bob's question, when he mentioned friendly condemnation, there is not even
without the power of eminent domain, there is nothing to stop the agency from purchasing a
piece of property within the project area, the only benefit to "friendly condemnation" is that the
property owner will get certain tax benefits that apply an acquisition by eminent domain or under
the power of eminent domain, , is it correct? that does not apply to the purchase of property by
an entity does not have the power of condemnation,
Mr. Deitsch:
That is correct, it does not apply to the purchase of property by the agency, if it did not have
eminent domain authority for that property,
Chairperson Kovacic:
So a property owner who is willing to sell property, at a assumed agreed upon the price to the
Redevelopment Agency theoretically would much prefer that the Agency have the power of
condemnation and not because that person gets certain tax benefits,
Mr. Deitsch:
I believe so, that is correct.
Member Harbicht:
So why wouid we want to exclude residential?
Mr. Deitsch:
Because of the requirement to have a PAC as far as this process, O,K" it is just a complication,
but.
Member Harbicht:
I do not say that we necessarily do, I mean I do not care about the property North of Colorado,
we are not doing anything there but' do care about the property....
Chairperson Kovacic:
It seems to me that the PAC wanted another level of,review, it is time consuming and if the PAC
works against the use of condemnation then a super majority of The Council, four-fifths, would
have to pass instead of a simple majority
Member Harbicht:
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That is correct....,
Mr, Deitsch:
Two-third vote (4 of 5) to be qualified to go to council but then it has to approve-------four votes,
--- to be qualify.
Member Roncelli:
You were here when we were talking about a piece of ground in the Third Street which was Third
street -m-----it was a piece of ground in there own by one property owner, I think you almost went
to condemnation or you got very close to going to court about it, somehow we accepted
property?
Mr. Deitsch:
Yes.
Member Roncelli:
And after we accepted whatever ___m_ and what the price wili be, then there was a clean-up
problem after that as J remember, it was pretty high, ----- the owner of property as J remember
got very little for his property, if given a choice to stay there on his own, it might not be very good
for the City, but for the owner of property could have been O,K" because I think the cost of clean
up today is lot less than it used to be so I am just looking at the property owner side of this.
Mr. Deitsch:
It depends on how you look at it. The value of property would have been reduces for all kinds
times sake, the cost of clean up and whatever, --------- if you ------ over time the cost of clean up I
might be fine and property values might __m_ you are right, they might have done better simply
sit on the property, even if they were not using it, they were not using it to full capacity, on the
other hand they would always have difficulty finding a ready, willing and able buyer to pay good
price if the buyer knew, and believe me today they know that there Is a clean up that has to be
done on some parcels
Member Roncelli:
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but..,
Mr. Deitsch:
No, you have'to clean it up in some point.
Member Roncelli:
I mean, he did not really have a choice to keep it or not.
Mr. Deitsch:
No,
Member Roncelli:
Do we ever make a deal, where we cleaned the property up? Let's say we excepted as it is.
Mr. Deitsch:
Well, you could do that. By the way, at the time we acquire that property, we also have the City
yard which had a clean up issue of it's own, on the Gribble Site, and we have to clean that up
voluntarily of course, because we are using it for purposes of Gribble project yes, you could
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clean up a property on your own if you wish to absorb some of the cost, or paying higher price of
the property and then have the property owner absorb the part of the cost with the higher price
that you paid there are ways to structure a deal I suppose I'd question, why he'd want to do that?
Chairperson Kovacic:
Gino, if I can just follow up on what you said, the property owner had a choice to disagree with
whatever the City said the offset should be on value, we go to court and have a judge determine
how that contamination effects overall value of property,
Member Roncelli:
I do not think they knew about the condemnation of the property at the time of the sale, did they?
City Attomey Mike Miller:
There was a question back then, there was a disclosure problem, and the law was a little
different then. We had a similar problem with the property called the Keywit property where the
property owner was not disclosing what they are supposed to disclose, similarly the bond to the
point, so we had to go after them to preclude.., so we were successful in doing that, but it was
litigation..
Member Harbicht:
All has been changed through out the years, by pulling out the plug letting the oil drain straight in
the ground and putting it back in and putting the oil in, and there was significant contamination
there, that he created,
City Attorney Mike Miller:
He knew, and he should have known, but he did not tell us,
Member Harbicht:
What happened in the ground was great, but it was on top that was really bad,
Chairperson Kavacic:
Nowadays, nobody likes that issue .... well, does anyone else has any questions about eminent
domain?
CounCil/Agency Member Gail Marshall:
I have a moral problem when it comes to eminent domain residences, I mean, like this poor old
guy that buys a place, he says, weill am gonna buy this house, I want to die here, this is where I
want to stay, he gets in there, he is comfortable and watching TV, pretty soon City comes along
and he says you are out of here he says but I do not want to go anywhere, he says too bad you
are out of here and they force the guy in to leaving and moving and so on and so forth. I do not
feel it is American to do that, to a citizen, now, if you can work with businesses and businesses
are relocating and every thing is fair and every thing, but on residential side of it, I really do have
problems with that people, in fact my parents went through where K-Mart sits, they had four
houses and a piece of property three of them where their income property, that is what they
made their living off, They did not want to go anywhere, they had the best piece of property in
the whole redevelopment area and it was their income and they were not offered that much for
the property, somebody said sure, you can go to court, you can fight it by the time he got done
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paying lawyers he was gonna end up with worst shape than that, I almost lost my father from a
heart attack over that, over that whole scenario unto this day, he is eighty four he still talks about
his property over there where K-Mart sits, So, I morally have little bit of problem when it comes
,
to residents and families and doing that to them, that is just my opinion,
Chairperson Kovacic:
I think that is a valid opinion if I can just offer ---- I think when Roger mentioned, residences
being cheaper, ) think in large part in practice they are cheaper, because for whatever reason,
owners of single family residences do not fight, they in large part take the offer from the City and
that is it. I disagree on your discussion about the attorneys only, because that is what I do, I
represent the property owners in eminent domain cases......, and most of time an eminent
domain attomey is going take it on contingency which is a percentage over what has been
offered by the City, so I would say the number of cases where the property owner ends up for the
less than what was offered by the City are very few, on the other hand, when an attorneys get
involved the price of the City can increase, so that is something to factor in, as far as it being not
American, you know, we are talking about the fifth amendment it is to right an obligation in the'
Constitution, but I understand because lot of my clients are in the same situation and they feel
right it is just not right for government to take their property whether it is their home or their
business, their strawberry patch, their mountain retreat or whatever, so I think that is a legitimate
concern and I am not sure there is anyway that we can get around that court and court morality is
the issue
Member Marshall:
Now if someboCly has to come through with freeway and has no other place to put the freeway
and the streets have to be widened take a section of somebody's property for widening the street
because they have to be for a certain reason but they're not taking somebody and throwing them
out in the street and freeway that's a little different situation but just to do that to somebody and
then move in a commercial site, I do not know,
Mr, Penman:
Maybe there is a distinction here, I think there is a very valid concerns about the properties off
the Colorado, I mean there really any goal doing anything not I am aware of, and there is a lot of
in housing stock up there from what I've seen, at least in pretty good shape, and so the Council
will be interested for us to look at it, we will probably want to do an inventory of the housing
stock that is in the balance of the area, often times, I can not say this for a fact, what we find is
very substandard housing in some of these areas particularly, when its in non conforming use,
we have got an apartment complex silting in the middle of industrial area, I am not saying that
this the case here because I didn't inventory it, but many times we find that housing is very
substandard its occupied by low and moderate income people, the way the law works, many
times these people are placed in better housing provided, sometimes they are atlowed because I
the way the law works they get section eight of certificates of housing authority to provide them
some assistance so there are lot of protections,
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I guess what I would suggest there are probably two different areas that we are really looking at
here, you know, the single family and purely residential area, which is what we have on the North
of Colorado, and then some spot residential in our commercial industrial areas, if you want to
look at see in what kind of condition they are in, because many times the residence actually and
I believe most of those are rentals, would actually come out ahead, but we have to look at that
and make that determination in terms of the condition of housing.
Chairperson Kovacic:
Okay staff are looking for direction and let me try to list the options and add some more if I
already do not have them all, we probably have a redevelopment project area there that does
not have the power of condemnation, one option is to keep it that way, maintain the
redevelopment project area also, the prohibition against condemnation, another option would be
to reinstitute the power of condemnation for the entire project area, another would be to
reinstitute the power of condemnation but not for residential uses, another would be to reinstitute
the power of condemnation and exclude certain residential uses but not all of the residential
uses, are there any other options?
Member Chandler:
One more for Clarification, did we cover the fact that we could omit certain residential area but
include the other,
Chairperson Kovacic:
On the residences the one action that we can take is just not have our power of condemnation
apply to any residential use, another would be to pick and choose the residential areas that we
think ought to be exempt from condemnation.
Mr. Penman:
You probably not conforming..,
Chairperson Kovacic:
What you suggested Don, or at least put on the table was that West of the City is really wild
about redeveloping the residential uses, you said North of Colorado, actually there are some on
the South side of Colorado as well.
Mr, Penman:
There are
Chairperson Kovacic:
Maybe exempt that area but you would like to take a closed look at the others because they may
be in the middle of the potential development.
Mr. Penman:
I suspect that their conditions probably is not as....
Member Roncelli:
We got a church in here to...
Mr. Penman:
In North..,
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Member Roncelli:
South side of Colorado, over here on Huntington and Colorado,.. Santa Anita Church, and we
have got number of Motels along there,
Chairperson Kovacic:
Obviously putting in the plan of power of condemnation, does not mean that we are gone
condemn all this people. OK what is the Council preference, Bob,
Member Harbicht:
You know the first question we need to answer is, are we going to reinstitute the power of
condemnation or not? and, if we are not then essentially we are just winding the Agency down,
because you can not do redevelopment projects without the power of condemnation, you know,
people will not come to the bargaining table, so it becomes an agency with no power, and
nothing further would happen, Also, if we decide we do not want to reinstitute the power of
condemnation there is no sense talking about having an agency down in the Live Oak area
because we could not do anything down there either. So, in my mind I think that we should
reinstitute the power of condemnation, With regard to the residences, I personally do not have
any interest in doing any redevelopment North of Colorado or along Colorado and to exclude that
area is a slam dunk form me, Over on Fifth, we have significant potential for development
there, we were trying to do a deal in concert with Monrovia when they did the Hotel and Macaroni
Grill and also developed our side of Fifth Avenue. we ran into problems because, of those
residences there and significant cost in acquiring that property, but that does not mean that we
always going to have problems there, the owner of property may at some point want to sell it and
us having the right of friendly condemnation to work with him could be a significant benefit to
him and it should be a significant benefit to the Agency because we could buy the property with
far less money, than if he could not get that tax benefit, and so, I think excluding those
residences over there would be a mistake, because there is a potential at some time that we
would want to do something over there, I think it would probably be in the area of friendly
condemnation, because we----- never pencil out to actually----- but the fact that they may be
some residences on those streets between Santa Anita and Second where is just mostly
industrial now and slowly redeveloping, most of it privately redeveloping, but there are some
residences in there, and if we exclude all residential, then we have a potential for one little tiny
house in there to clear the whole deal, virtually, all of that property is renter occupied not owner
occupied, but if we do not have the right power of condemnation the owner of property can, it is
not because he feels for his renters, it is because he holds all the aces, could stop a project, so, I
would not be in favor of excluding all residential, I would be in favor of excluding that residential
from Colorado North, so that is where I stand on it.
Chairperson Kovacic:
Does staff have any problem with excluding the Colorado area, I mean is there any.. this does
not seem like, this is a no brainer for you guys,
Mr. Penman:
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Probably in the horizon of the Agency's plans, we 'would never get up to that area, it is not a
blighted area,
Chairperson Kovacic:
It is not bladed, O,K.
City Manager Mr. Kelly:
On the residential that Bob described it is more indicative and needs change,
Member Harbicht:
Some of that stuff on Third Avenue, was almost literally falling down, I mean to those people we
did a favor, they did move to much better housing and got plenty of economic benefits, they
were all renters, but we have to help them to,
Chairperson Kovacic:
Well, I would like to follow Bobs explanation, and just put a motion on the table
xxxx:
Unless you want more discussion,
Chairperson Kovacic:
Well we could have more discussion before or after the motion, but I want Gino and Gail express
their opinions to,
Member Roncelli:
Is there a way of eliminating the residential up on, say, Colorado, in the South side of Colorado
North I guess where it would be, and also, having the places over on Fifth Avenue, there are
rentals down there included in the development...
City Manager Kelly:
We probably have to inventory, all the residential and decline in adopting Resolution and
Ordinance, with description of both legal and graphic of these properties, excluded the power of
eminent domain, so, we got to see when we do a field survey moo update with the Council one by
one by one, ---- look at each piece of property before decided.
Mr. Penman:
We can do, what you are suggesting,
Member Roncelli:
When you decide to do this, do not we need to know that ahead of time, do not we need to know
what is eliminated and what is not? Before we vote on it? Or not.
Mr. Penman:
I think what we are really asking for is seeking direction, we are coming back with subsequent
reports information to the Agency needing with more detailed information as Bill said -------
analyses of who many residents,..
Member Roncelli:
Will still ----- a little bit.
Mr. Penman:
Absoiutely, yes
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Chairperson Kovacic:
So, your feeling is, we should include that residential in Colorado North,
Member Roncelli: I
Yes, I would think so to, There may be some other areas, that I did not really look at yet, you
know, like a Church, and there is a nice building up there at the corner of Colorado and Colorado
Place too, and I do not know why that would not be an issue,
Chairperson Kovacic;
That is North of Colorado
Member Roncelli:
What is on the South side of Colorado,
Chairperson Kovacic:
O.K. we can include that in the motion to exclude that.
Member Marshall:
We are not deciding which is yes and which is no to night.
Chairperson Kovacic:
No, we are going to take ultimately a vote on direction there gonna go back study it, keeping in
mind our sense of direction and then come back with a proposed motion,
Member Marshall:
I am not proponent of us doing __m taking somebody's property from them, I am sorry that was
a wrong terminology I should have said taking because it is asking not taking, we pay them for it. I
However could go along a little more if we are differentiating on residents,
Chairperson Kovacic:
Any residents?
Member Marshall:
We will have to be real choosy, no not if it is a really a bad fallen down thing, that you are
actually dOing a favor for somebody, there are times that it would be a favor to...
City Manager Kelly:
For us to actually condemn, the Agency Board must vote on
END OF SIDE ONE
Member Marshall:
We are voting in for twelve years
Member Harbicht:
We, don't have to use it.
Member Marshall:
No, I am saying we will,
City Manger Kelly:
It is a public hearing as well, it is --- on the Agenda public hearing, both sides speak, it is a very I
complicated legal process it doesn't just happen,
Chairperson Kovacic:
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Okay the sense I get is that nobody is really on favor of the eminent domain power being apply
to the residential areas along Colorado and North of Colorado, it is that true? that is one sense of
direction, the other sense of direction is that it looks like the majority of us are looking favorably
at reinstituting the power of condemnation South of Colorado but there may be pockets of uses
or buildings or whatever that we might want to fine tune, and we will ask the staff to inventory
this area and then come back with the proposal concerning that, is that the sense everybody
has?
Member Roncelli:
No problem.
Chairperson Kovacic:
Okay, I have one question, if in fact we decide to reinstitute the power of condemnation and
start going through the process of doing that, what is the price tag to do that, with the various
hearings and possible PAC's and all that, do we know?
Mr. Penman:
Seventy five to hundred twenty five thousand, if we did an amendment, including the area South,
it is just a narrow amendment for condemnation of this project area the major cost will be.... and
Live Oak, Yes,
Chairperson Kovacic:
That is just to acquire the power of eminent domain without acquiring one piece of property, we
are going spend..,
Mr. Penman:
We did an estimate on cost of amendment including the Live Oak area, much less than that, the
major cost will be, the PAC would be staff by us, so that is just an in-house process and we have
to actually inventory the properties and sent a mailing..
Chairperson Kovacic:
I am sure you will make that part of your statement
Mr. Penman:
It is not in the seventy five and over hundred twenty five thousand dollars area,
Member Harbicht
I would like just add to it that we probably should also direct them to exclude the area South of
the alley South,of the Huntington, in other words North side of Alta Street, because that is all
apartments,
Chairperson Kovacic:
We need an extra motion or roll call?
Member Roncelli:
What about the hundred and one club that is in there,
Member Chandler:
I would move to reinstate the power of condemnation and to
Member Harbichl:
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It is the sense of direction, to direct staff,
Member Chandler:
Yes, and to direct staff to pursued the reinstatement the power of condemnation, and to include
all project areas residential use to the exclusion 'of residential properties on the North side of
Colorado and South of the Alley, South of Huntington,
Member Roncelli:
What about South side of Colorado,
Member Chandler:
And the South side of Colorado,
Chairperson Kovacic:
Okay, there is a motion and does that motion assume that there will be an inventory of
residential uses within the non excluded area and that we have an opportunity to fine-tune that at
the time of the hearing,
Okay, any discussion, roll call please,
City Clerk June Alford:
Council/Agency Member Chandler,
Member Chandler:
Yes,
City Clerk Alford:
Harbicht?
Member Harbicht:
Yes.
City Clerk Alford:
Marshall?
Member Marshall:
Yes,
City Clerk Alford:
Roncelli?
Member Roncelli:
Yes,
City Clerk Alford:
Kovacic?
Chairperson Kovacic:
Yes,
Chairperson Kovacic:
Okay that takes care of central redevelopment project area, and Don as I understand you now
want to move South to Live Oak, I
Mr, Penman:
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Yes. Very briefly, one of the goals of the Economic Development Division and Development
Services Department is to work with each of the commercial areas in the City, and as you are
aware we spend considerably amount of times in the down town and Central Business District
area the next area that we started to look at, we describe as South Arcadia Live Oak area and
we had been visiting property owners down there, we actually had some development interest in
that area as you are aware, the Meekers, who own a substantial amount of properties are looking
for some development opportunities in their site, As you are also aware we were approached by
a major retailer looking at a location in the Live Oak area, One of the things we encountered is
that our ability to try to make some of the projects work based on some interest was hindered
and so, we wanted to look at all the available tools that might be at the City's disposal try to
promote an improved area in the Live Oak area and revitalization. Formerly, we asked our
attorneys Steve's office as well as a consulting firm that we want to take it very preliminary look
at Live Oak to see if it might qualify for redevelopment, I do not want to say it would but might,
enough to at least pursue it further to see if it meets all the criteria of law, The law is much
more strict today than it was certainly when our original project area was formed, but the
preliminary feed back as the staff report indicates is that there seems to be enough of the
conditions that exist down in that area, that may meet the criteria under redevelopment law.
What we are suggesting is that we initiate steps to study that further, which would involve the use
of consultants, doing more inventory of the properties, because the law is much more specific
today, in terms of what criteria must be met to qualify, It would not be an absolute commitment
to do that, but just take the next step to look at it, if you are going to do that, there are really two
options in how you wish to explore that, One could be a separate redevelopment project area all
by itself or an amendment of South Arcadia Live Oak area to existing project area, either they
are not contiguous, the law does not allow for amendment. The advantage of the amendment to
the existing project areas is you would have resources immediately available from the existing
project area, from our Central Business District area that we could bring to the Live Oak area to
have the immediate impact, therefore, other than may be the initial formation cost which could
be paid back, we wouldn't need to borrow funds from the City or some other entity to create
revenue or I should said, say the resources to do something to Live Oak, We did Live Oak by
itself, if you want to pursue that, and we did not do an amendment, we really have no revenue
because, as you may be aware the base here is established any increases in value from the
initial year of the projects form the Agency gets that, but today to pass the requirements to other
Outside agency's are much more extensive, so we would be passing through a significant
amount of revenue to the other agencies, which we would have to do for this area anyway, if we
brought in an amendment, we could use resources from Down town area today, therefore we
could have an immediate impact in doing something down there, so, if you give us direction to
pursue that, we recommend that we pursue an amendment to the existing project area than a
project all by itself,
Member Harbicht:
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Don, other than the pass-thru requirements that this area would have, that the other does not
have, would we have other restrictions on what we could do or how we operate in this area that I
we currently do not have in the Down town area,
Mr. Penman:
I like to om_ Steve
Mr. Deitsch:
Not really, in depends on what your plan calls for but you can pretty much have your plan call for
land uses you see fit, and you set the eminent domain, consistent with what we have just
discussed inregard to the main project. There are no other severe limitations for the amended
area that I could think of, off hand,
xxxxx
The only limitation then is that, we will a much smaller in tax entry,
Mr. Deitsch:
That is correct, but It will be co-mingled with the entire redevelopment project area, if you were to
amend the existing redevelopment project area to land territory, As opposed to having a stand
alone project area,
Mr. Penman:
This is to clarify, the new area would be subject to the new pass-thru the existing area would not
go,
Mr. Deitsch:
That is correct, the existing area is fortunate that it will rules, but continue to survive, without the
pass throughs under today's law that would only be applicable to the end of the territory
Member Marshall:
Who much bigger the pass-thru will be?
Mr, Penman:
Well, it is ranges from twenty five to sixty percent. Well, when the redevelopment project area
has been formed, new revenue generated from the project area from that date fOlward a
hundred percent of that goes to the Agency, but the laws have been changed over the years,
where the agency is now required, what they call pass through or give some of the percentage of
that revenue to the other taxing entities, So, in the past.
Member Roncelli:
Such as?
Mr. Penman:
County Flood Control, County Genera Fund of schools, they have to do pass through with
schools, things like that. In the past where our project .was originally formed there were no pass
through requirements and we did not do any, and there was a period of time where agency's had
to negotiate with taxing agencies basically, you do whatever deal you could cut with them in
terms of giving them a percentage of it, now the law is more specific about what you have to do,
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so we would not get a hundred percent of tax increment, but we would get a much smaller
percentage based on the form that identified on page seven of staff report,
Member Harbichl:
Basically, if there was a piece of property in the area and they build a hundred thousand dollar
building on it their taxes will go up a thousand dollars, and if it was in this area the entire
thousand will come to redevelopment agency every year, but if it down there a certain
percentage of that thousand would go to other taxing agencies, redevelopment agency will get
some of it ranging from forty percent to seventy five percent,
Member Roncelli:
Will the General Fund get any of that?
Member Harbichl:
No,
Mr. Penman:
In fact, I believe the General Fund of the City precluded from getting it, we are not allowed to....
Member Roncelli:
The School is getting?
Mr, Penman:
Yes, the schools a different animal for the basic reason, the schools basically made whole by the
State, another words on in law today, and I am not a school finance expert, but the State by law
is required to give every School District the same amount of money per student,
Member Roncelli:
So, if the City does not fund them enough, the State will,
Mr. Penman:
The State makes up, That equalizes the poor Districts versus the wealthy Districts, it goes back
to Serrano vs, Supreme Court decision, so, while redevelopment might take money away from
Schools, then the School is then made whole by the State.
Member Roncelli:
So this new law has made not as lucrative for redevelopment areas as that it used to be, is that
what you are saying?
Mr. Penman:
Yes,
Member Chandler:
Basically it makes it tougher to payoff your debt.
Mr. Penman:
It makes it tougher to finance projects, and it makes whole the other agencies,
Member Chandler:
At the same time if we make this part of the other project area, then we can use funds from the
other area down here,
Member Harbichl:
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I can not think there is anything wrong with that, it is all one City,
Member Roncelli:
There does not have to be any way to connect it just part of you are saying..,
Member Chandler:
Yes, and as the other area pays off its debts and continue to receive funding we can funnel some
of the funding down here to an area which frankly badly needs it, hopefully get the same kinds
of, you know, really effective kinds of development that we have gotten up here,
Member Roncelli:
Why does this agency have to fold up its tent anyway?
xxxxx
Twenty fourteen (2014).
Member Roncelli:
So, we are talking about fifteen years or something, and that is it for this project if we would be
part of that, right.
Member Chandler:
We could not extend it, even it was a separate, beyond twenty four---
Mr, Deitsch:
Yes, and no, the reason redevelopment plan in the first instance may expire in terms of what you
can do to redevelop but you continue to collect taxes for at least ten years beyond that, if
necessary, to payoff existing indebtedness,
Member Roncelli:
So, it could go into twenty, twenty four (2024),
Mr, Deitsch:
You could,
Chairperson Kovacic:
Gail, I'll recognize you but I just want to give the council warning we have a Close Session, that
Mr. Kelly indicates will take about an half an hour, so we should either target this study session to
end at 6:30 or go to 7:00 and have the Close Session afterwards and, we do not have to make
that decision now, but I just want to give everybody a warning, okay Gail.
Member Marshall:
I have done some very, very, very extensive study on this for the last four days, and have written
my ideas down, and if you would not mind I just, of the top of my head, if I could please let you
know how I felt about this and where I came working my pencil and thinking about that. First of
all my hat is off to the Redevelopment Agency for the great job they have done with the hotel
development. In 1997 the Agency assisted the hotels and brought in one million dollars in bed
tax to the City, It would be great if we continue to build more hotels, as far as I am concerned
that is the best of the best that redevelopment has to offer. At the current time however, we
have to wait until market absorbs the new units that are going to be brought on line, How have
we done with the Redevelopment Agency projects, aside from hotels? The Downtown project
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area generates one hundred fifty-thousand dollars of sales tax, Only a hundred and eight
thousand of that is attributable to the Agency assisted projects. The property tax increment in the
Downtown project area is 2.4 million, if the Redevelopment Agency ceased to exist, after debt
was paid off, the City will receive two-hundred-and-thirty-two thousand (232,000) in property tax
revenue, In other words Arcadia looses twice as much in lost property tax revenue as it gains
from sales tax due to redevelopment.
Our decisions tonight must be based on the current situation and not on the past. At this point
we are giving up services for the citizens due to frozen property taxes, In my opinion the citizens
find that education and services to be the priority at this time, The only way to increase these
priorities is to increase the General Fund, This will not take place if we continue to put any
increases in the tax dollars back into redevelopment. In lieu of redevelopment, I believe we
should work with businesses to expedite processes and make it easier for them rather than using
the subsidies and giving away land,
Do you remember when Mr. Kelly showed us the tax bill from Monrovia during the budget
session? Monrovia had lots of assessments and bond, I have a copy of it right here, if anybody
want to refer to it. And Monrovia has also over thirty five million in debt for redevelopment, it is
apparent if you study redevelopment, these two issues go hand in hand. Arcadia is only six point
million in debt at present and I want to see this decrease and not grow, If the redevelopment is
working so well in Monrovia, why do they have so many bond debts and assessment to deliver
services to the citizens. I do not believe in taking money from the citizens to subsidize large
corporations, I believe if the citizens truly understood the redevelopment and how it works they
would be up in arms about it. I got copies of some information, I'd like to pass around please,
that is taken from the US Census Bureau, California State Controller. Table five shows Cities
with redevelopment compared to the cities without redevelopment pertaining per capita income,
growth, I believe it is on second page, Cities without redevelopment faired thirty-eight percent
better than cities with redevelopment. I called Redlands which has population of approximately
seventy two thousand, their City Manager said Redlands put their Redevelopment Agency on
inactive status ten years ago, they still feel that was a wise decision, they are doing fine without
it, a large theater was built and it is thriving, they have two large box retailers right now, such as
the K-Mart, Home Depot and Wal Mart are in the making without any incentives or give aways.
A car dealership was offered a million dollars by a neighboring City, they moved collected their
million and after a short time moved back to Redlands, because business was better in
Redlands, Redlands is proof that businesses will come to a City, where their business will thrive,
if a company only opens because of give aways and incentives, they probably will not last
anyway.
I urge any of you to talk to Redlands Manager, and hear it first hand, the City Manager handles
all development without using redevelopment. In the over view of the Arcadia our
redevelopment project that we all got here to study, if you please turn to page seven, its states
under new redevelopment project area, although an analysis by a financial consultant is needed,
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it is questionable whether a small project area in South Arcadia could generate significant tax
increment revenue to be feasible, and then if you jump down to the bottom of the page it said, if
the Agency wishes to create a new project area, existing project area funds can not be used,
The City could loan the funds to the Agency, to be repaid with interest from the project area
revenue when received, If the project area is not adopted by the Agency and City Council, or
there was insufficient revenue to repay the loan, the City would bear this cost, I say, let free
enterprise work on Live Oak and work with private companies to make this all happen, No one
wants to see Live Oak developed more than I do, I see it every single day, However, it is on an
up swing and I would like to see the citizens benefit the services instead of rich corporate
businesses given money, We do have things on the table for down there already, that we are
looking at and I think that would really help, this brings up another issue tonight we vote on
upgrading the median along Live Oak between Santa Anita and Baldwin, the median between
Santa Anita and Sixth Avenue is in lot worse shape, I said iets look at the median spend the
money where it is in worse shape, or we want to develop, that is sounds like it would make more
sense to me or maybe it would help the development come along,
After studying the figures, it is a fact that the property tax increment is greater than the sales tax
generated in our redevelopment area, I truly believe the timing was perfect for us to down scale
our Redevelopment Agency to one person, We are a built up City, we cannot build any more
hotels, We do not need to burden tax payers with bond debts and assessments or cut services,
Arcadia can return to the thriving city once it was, when we look at the facts and figures and vote
accordingly, We owe it to the citizens,
Chairperson Kovacic:
Okay, thank you Gail. The calculation you did on your first page when you compared sales tax
to property tax, is that the calculation you did?
Member Marshall:
Seven hundred, that it generates seven hundred and fifty thousand in sales tax,
Chairperson Kovacic:
That is the Central Business District,
Member Marshall:
Yes, hundred and eighth of that is attributed to, only hundred eight to the Agency Assisted
Projects, the rest comes from the things that already existed or that were not assisted by the
Agency,
Chairperson Kovacic:
Okay, then you had the calculation about sales tax versus property tax, what was that?
Member Marshall:
Well, now I got to go back and find it.
Chairperson Kovacic:
Anyway, I am not sure that you included the tax increment part of redevelopment, so maybe staff
can take Gail's figures and see if you compete with them,
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XXX)(
Well, I understand the numbers,
Member Harbicht:
It is a lesser amount now, but it is still a big portion, still does go,
Chairperson Kovacic:
As I understand it, the tax increment that the Redevelopment Agency gets is more than the taxes
the City would be get absent Redevelopment, and so you have to factor in whether its worth the
extra money we get in tax increment to have a Redevelopment project.
Member Roncelli:
It does not come to the City, it goes to the Redevelopment, so it does not come to the citizens to
spend on things we need,
Member Marshall:
We would have another two hundred thirty two thousand in the General Fund if that did not go,
that is our tax increment, if we develop South Arcadia and do not put it under redevelopment,
that hundred percent of those property taxes and the sales taxes and everything will go to the
City, we will up our General Fund,
Member Harbicht:
That is funny reasoning,
Member Marshall:
What do you mean..,
Member Harbicht:
What ever it is it would go to the City rather than the Redevelopment Agency,
Member Chandler:
Yes, everything is down there now, the City's portion goes to the City,
Member Harbicht:
Whatever would be developed on its own will come to the City,
Member Marshall:
Hundred percent of tax would go to the City, we would not have the income,
Member Harbicht:
Now, if you stop it now in redevelopment, nothing will go to the City.
Chairperson Kovacic:
I think it is safe to assume, that if same level of development would occur both with and without
the Redevelopment, then it is better to have free enterprise than Redevelopment. I think the
issue here is in why Redevelopment Agency's for the most part of businesses is that people are
convinced that without the Redevelopment efforts the areas wouid not improve at the same
rates, so I think that is jus!.....,
Member Marshall:
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However, we already have three things that are in the making and we have not put it under
Redevelopment, and I feel once that starts it probably would generate that area, if staff will be
working willing to work as you have been anyhow with these people,
Member
Let me just set the stage for Live Oak then, If we do not have Redevelopment and we keep it
the way it is, the City has what power? the City can tweak the zoning to sort of entice certain
uses, we can go on and spend money for trees, and landscaping and all that kind of stuff, and we
can sit down with the various owners and say, hey why don't you fix up your property, in this case
we have an unusual situation because, contrary to lot of Redevelopment project areas, where
you have a lot of disbursed absentee owners here and there, you have just one major owner
down there, so it is not a typical Redevelopment scenario necessarily....
Member Marshall:
That is true,
Mr. Penman:
In the one block,
Member Harbicht:
You have anybody from Meeker family here to talk to us?
Mr. Penman:
Not that I am aware of.
Member Marshall:
However, in the second block you only have, I believe isn't t it two people that are outstanding,
he owns the other block doesn't he?
Chairperson Kovacic:
He owns, on one block he owns all but two pieces,
Member Marshall:
That is all, that is owned the whole area, the whole two block,
Mr, Penman:
I think the survey, and I understand that the survey that I looked at, the entire street as you know,
the Arcadia Santa Anita Bowling Alley site is for sale, and we looked at a project there, but the
project does not make sense, based on the size of the site, that is why you know..,
Member Roncelli:
One of the pieces of property is the Arcadia Assistance League Bargain Box that they own, on
the South side of Live Oak,
Member Marshall:
So that might make three pieces of property,
Member Roncelli:
But no one would be to condemn that, I can tell you, not me..,
Chairperson Kovacic:
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Again, when we talk about redevelopment we are not necessarily talking about condemnation, I
want to get staffs input, Right now the City can do certain things and I have sort of outlined what
those things are,
Mr. Penman:
Correct.
Chairperson Kovacic:
Okay, and I am sure....
Mr. Penman:
The only other thing is that we have Community Redevelopment Block Grant which is Federal
funds, there may be a possibility of using some of those monies, but when you do that, you use
Federal funds, then you have to comply with all the Federal requirements which has to deal with
paying prevailing wages, et cetera....
Member Roncelli:
I always understood the CDBG money can only be used in the Downtown area, because it is the
only one that qualified under the income basis.
Mr. Penman:
That is correct, we just met two weeks ago with the Community Development Commission staff
to see if there is a way to qualify that area, they said it is possible, that we could, but we would
have to be able to prove blight. Some of the same criteria you have to meet for redevelopment,
you could prove that under the Federal Law then you could potentially use CDBG, but then, of
course, you have the Federal strings to go with it, in terms of you have to pay certain wages to
anybody who does work on that public project and meet other requirements, We are not even
certain that could be done, we are saying that is the possibility for funding,
Member Roncelli:
So anyway, those things are in place and we have those powers, and we can either use them
wisely or there is things we can do, In the future to do something, What's staffs position about
the benefits of Redevelopment? What other toots would you get if this was put in a
Redevelopment project area that would improve the area that you don't have now,
Mr. Penman:
Well, I think the example that we are working with, which is an exciting is one, we have a user
who wants to develop down there but he needs more property than what they can assemble
property owners want, you know, over thirty dollars a foot for their land, when the appraisal is
probably and the twenty dollars per foot, so it gets back to the issue, It gives you a tool, to try to
negotiate with the property owners, to try to make a project work, and then also, having the
resources we can do a lot of the side work down there, like we have done on the Downtown in
terms of trying to improve some of the building facades and appearance of the property, and we
can also do public improvements,
Chairperson Kovacic:
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Let me just take that example then" and I do not want to commit to specific uses, but let's
assume that it is something like that, and we say, yes we can set up a -------- project area, but we
got to pay Steve a lot of money and with all these meetings and all this kind of stuff, and in the
end the guy's are asking thirty bucks a foot, we think it is twenty five bucks a foot, can the City
somehow loses and just say why don't we just chip in some money and help get this thing
going?
Mr. Penman:
The City?
Chairperson Kovacic:
Yes, that is the only apparatus,
Member
The Redevelopment Agency,
Chairperson Kovacic:
We do not have a Redevelopment Agency, what I am saying is can we kind of cut our loses and
help out these potential developers without forming a Redevelopment area?
Mr. Penman:
The only thing, maybe Steve wants to talk about what was done in another project, but the only
thing I can envision is sometimes there are dedications, public improvements, that are neede, so
for example if a traffic signal need to be installed or moved the City could, if it is in the right-of-
way pay for that even though we could also condition developer. We also have a program if the
Council already approved, where we can waive certain types of permit costs, building, planning,
They don't add to huge numbers, in fact, we looked at that form of assistance on this one project,
and they amounted to about fifty thousand dollars, which is not a drop in the bucket, but when
you are probably a million dollars apart it does not make a difference to close the deal.
Member Harbicht:
Can I just comment on that, even if there were a way, then we have taken care of one project
and one property owner. We are talking about a huge area here,
Chairperson Kovacic:
That is sort of... the point I am trying to make, but, I guess the spectrum of thought is that taking
this particular project as an example, On the one side, lets let the free market do what it is going
do, and staff doesn't think It is going do it but maybe some other people think that ultimately that
property is going be developed one way or another, and on the opposite end of the spectrum is,
you need government to kick-start it a bit to heip in the acquisition of this parcel and maybe get
some leverage over this hold-out and ail, And that is sort of the spectrum we are talking about.
Okay, and staff feels that based on the condition of Live Oak and the historic condition of Live
Oak and without government involvement not much has been happened,
Mr. Penman:
That is the believe at this point of time, And if you have..
Chairperson Kovacic:
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Lets say we had it right now, it was amended, it was a done deal. All the paper-work had been
taking care of. Do you think you can make some of these existing deals work?
Mr. Penman:
One that we are excited about is, you know, we are just too far apart, I think the examples earlier
that we had some leverage then the property owners get some benefit tax wise because they
have reinvestment opportunities, and if there is a gap there, One of the problems people donl
understand with redevelopment is when you appraise it you have to appraise on highest and best
use, what is on there today, even if the property will be leveled, we have to pay for those
improvements and that is technically the gap that the Redevelopment Agency comes in makes
up, so, it is that gap is what we could be talking about, and you know I feel confident, I mean I
would love to see the project happen without it as you know we have worked extensively on that,
talking to property owners, talking to the potential user and really trying to make it happen. It has
not happened yet and I believe that if we had redevelopment we could make that happen.
Member Roncelli:
Is there a possibility they are holding out knowing that this could be a..,
Mr. Penman:
The owners? yes there is always that possibility,
Member Roncelli:
Knowing that, If we turn this in to redeveiopment, they are going to get more money for it.
Mr. Penman:
Well, there may get some tax breaks,
Member Roncelli:
That is what I am saying, why wouldn't they wait?
Member Harbicht:
I think that the are looking at kind of a long shol plus a long period time, this is not going to
happen overnight.,
Member Roncelli:
Could take forever...,
Member Roncelli:
Even if we put it in Redevelopment area, nothing going to happen,
Member Harbicht:
No, it would take. how iong would it take to make this happen, do you think?
xxxxx
ON nine months, perhaps,
Mr. Penman:
I think the other thing is that in the initial conversations that took place between the broker for
the retailer and the property owners took place before we even thought about redevelopment, so
when we said, well maybe this is an operative,
Member Roncelli:
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It is my belief that Mr, Meeker, his family trust, has been buying properties for a long period of
time, and they have ideas of developing this without our dollars,
Mr, Penman:
Correct.
Member Roncelli:
They have always had this idea, from what I understand they wanted to build back all the way to
the alley and pit the parcel in the front, that was kind of their idea, and I do not see anything that
would stop them from doing that.
City Manager Kelly:
Let me bring up an issue here, one of the issues and we are raising this with Rays for
consideration is, one or two years ago the Council was being chastised for not doing anything to
Live Oak Avenue, it is getting worse and worse and worse, we can not say what are our options?
We looked at the PBID which is a private business development corporation, no interest. We
looked at getting the owners together with the Chamber of Commerce to do something no
interest. The Meekers are one large owner of two blocks and the rest of the area is going
downhill, and they are letting that happen deliberateiy waiting out some owners inside, They
have month to month tenants and I can tell you that when that happens the uses go right to the
bottom so, we have an area that is just looking worse and worse every year, and the Council said
what are our options, we identify the options and putting one over on them tonight. The ultimate
short term option to cause change is Redevelopment. If we do not do redevelopment and we
use the tools that we have right now as the Mayor said we have some carrots on the City side,
we do not have the hammer you might say in the Agency side,
The Councils question is, do you want to let the Free Market go as it is right now and see what
happens or interject the Agency as a tool to help it happen, The Agency creation is not going to
change itself just what happens down there, and yes the tax money will be deverted, your
threshold question is here if you want to continue as it is and wait for things to happen or interject
the City slash Agency into the equation,
Member Harbicht:
Well, I do not think that we should be talking about Meeker or his property, we are talking about
both sides of the street for what, a couple of miles, I have heard for years, why doesn't the City
do something about Live Oak? This area has been moribund for twenty years, twenty five
years, not much has happened, and I think it is a question we have to come to grips with, Do we
want to do something about it or do we want to just let it continue as it has been? We can let it
continue as it has been, but the feed back I get from the people who iive in that area and some
of the business people in that area 's that they want some help, they would like to see this area
upgraded, The only way that we can do it is by making it part of the Redevelopment Agency,
everything else is just little nudges here and there it is not going to make it happen, that is what it
comes down to, if it is the Councils pleasure to say no, let it continue as it has been going, and if
you have confidence that all of a sudden it is going to make a U turn and come back then we
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should not be involved, I do not happen to have that confidence, but i've been watching it for too
long and it has not happened, so that is really the question that is before us not whether one
piece of property is or is not going to sell to the Meekers who trying to gouge them for fifty
percent premium on the value of property, that is not what is before us, what is before us is this
entire area down here, It is an area which is probably the most depressed commercial area in
the City right now, and has been for a long time, nothings happened and I do not think anything
going to happen, and if you want to let it just sit there and nothing happen, then it is easy all we
do is say nothing do not bring us..,
Member Roncelli:
Do you think the Government can force something to happen?
Member Harbicht:
Can the Government force things to happen? No, but we can help things to happen as you can
look over on East Huntington Drive to what was all basically a slum and is now returning
millions dollars a year in tax increment and Transient Occupancy Tax and sales tax and also
providing valuable things for the people of this community to go to dinner, to lunch, all of these
kinds of things, came about because the Redevelopment Agency stepped in and working with
developers cause that to happen, If we have not done that, we still have those motels over
there, and we still would have the cops doing prostitutes things and we would still have those
slums up there on Third Avenue, and we would still have that contaminated property where the
bombs were, and where Keywig was we would still be burying fifty-five gallon drums of
contaminant under the ground that we found them there, all of that would still be there, and it is
not there anymore because we took a very reasoned to approach and we created a very nice
part of our City over there, I do not know if it would work, but I know what we are doing now is
not working, it is not happening by free market forces, and I think that is a shame, and I think the
City is guilty Of ignoring this area, We could be doing something, that could perhaps make this
an area that Arcadia can be proud of. That is what I think, and I think the people down there, the
property owners, the people who live just just north of there who are exposed to this everyday
deserve a little attention from the City, so, that is, I am willing to give it a try,
Member Roncelli:
Is there estimate as to what this will cost us? so that we can..,
xxxxx
Probably a hundred thousand bucks to put the Agency together.
Member Roncelli:
No I mean once we get an Agency,
Member Harbicht:
Then you start talking about individual projects, when each come before us to be individually
considered, the way every project we have done comes before us to be considered but first we
have to have the apparatus, the authority, We have to put up hundred thousand dollars, create
the apparatus, It could be that we would create it and we would never get a deal, that could
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happen and if so, we invested a hundred thousand dollars and become a coffer, but it also could
be that we could help some of these property owners to pull projects together and create things
that would be valuable for that area, and valuable to our City, I
Member Roncelli:
What is the cost of the Agency to continue, too, though, I mean, that is quite a cost,
xxxx
If we are not doing anything there is not much, Our Agency is going to continue anyhow it is
whether we amend it to include Live Oak,
Member Roncelli:
So, if we don't down size it, lets put it that way
xxxx
Well,we..,
Chairperson Kovacic:
We already made a decision to reinstitute the power of eminent domain which mean..
Member Marshall:
That does not mean we can not down size you can still do that..
Member handler:
You missed a bet because we already passed that.
Chairperson Kovacic:
We did not pass anything, we give them a directions it will come back for the motion, I think we
could count the votes and I would imagine it is going to pass but I do not know, but I think it is
unfair to say we adopted the power of condemnation,
Member Harbichl:
I hope we are not telling the staff the spend ....
Chairperson Kovacic:
I do not think we are
Member Harbichl:
We are asking lot of questions,
Member Marshall
That is what m_ we are talking eminent domain we are talking..,
Chairperson Kovacic:
We are getting off the point, Gail you had a point about Live Oak and I think we have to give
staff some more direction,
Member Marshall:
We already have things starting to happen down there, people here do not know it but we do,
that are starting to happen down there, isn't this a bit premature, we know about it we can not talk
about it to you yet You will know when the deals are finalize, I want to see it developed, I would
like to see City get the full taxes from it instead of it going back to the Redevelopment Agency
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because our General Fund is frozen. our services are rising, our costs are rising and the only
way we can keep up with it because it all goes back to Redevelopment, is to cut services,
Member Harbicht:
The Redevelopment is paying back the City's loan at something like four to five hundred
thousand dollars a year, it's not like this is....
Member Marshall:
And we turn around and loan it right back to them,
Member Harbicht:
We have not done that for a while, we are talking about it here, We are getting two million
dollars a year in our General Fund when these hotels are billed out every single year.
Member Marshall:
That is hotels Bob
Member Harbicht:
It is from Redevelopment.
Member Marshall:
One million is in bed tax. This down there you can't put any hotels down there.
Chairperson Kovacic:
I do not think that we going to reach a consensus so why don't we decide whether we are going
to go forward with this or not..
Member Chandler:
Mr. Mayor, I disagree with Gail a hundred percent, sorry, and I do not think we should consider
what may be under way I think we need to plan for the future, long range and that what this is all
about, and the marketplace is so competitive now, if we do not have an edge we are not going to
compete and that has come to past that is why there is no hope right now for Live Oak, we do
not have an edge we do not have a tool. I would like to make a motion that we amend our
current Redevelopment sphere include to Live Oak, to direct staff to do the appropriate staff
work, administrative work to amend our existing Redevelopment Agency to include Live Oak, the
whole district.
Chairperson Kovacic:
Okay, again, that is to direct staff to come back with a formal proposal. Okay, any comments?
roll call please.!
City Clerk Alford:
Council/Agency Member Chandler.
Member Chandler:
Yes,
City Clerk Alford:
Harbicht?
Member Harbicht:
Yes.
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City Clerk Alford:
Marshall?
Member Marshall:
No,
City Clerk Alford:
Roncelli?
Member Roncelli:
No,
City Clerk Alford:
Kovacic?
Chairperson Kovacic:
Yes,
Chairperson Kovacic:
Okay, there is one other issue..,
Member Harbichl:
Let me ask a question, to actually adopt this do we need a majority or a super majority?
Mr. Penman:
To do the amendment itself?
Mr. Deitsch:
That depends on whether a project area committee has to be formed and what their vote is?
Member Harbichl:
If they recommend against?
Mr, Deitsch:
tf the Planning Commission recommends against, then the super majority of two-thirds of the
Council would be required,
Chairperson Kovacic:
And that depends on whether there is residential areas involved is that the soul determining
factor?
Mr. Deitsch:
That is correct, specifically whether a significant number of lower moderate income families
might be displaced,
Member Harbichl:
Why go ahead, with this, we have got two people who are opposed to it. Then we are just
spinning our wheels,
Member Roncelli:
Maybe there is another way of doing it
Member Harbichl:
Why go ahead with including this area in the redevelopment zone, if we have two that are
against it?
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Member Roncelli:
The whole idea is that we are seeing the increment not come back to the City, that is where we
are losing out, if that increment came back to the City, would be great, every body wins.
Member Harbicht:
Eighty nine (%89) percent of it would not come to the City anyway, and goes to other Agency'
Member Roncelli:
I agree, but the ten (% 1 0) percent does, so, you'd rather have ten (%10) percent to the City than
hundred (%100) percent tot he Agency? And you are discounting all of the sales tax revenue
and all that, this is what it is going to cost us?
Member Harbicht:
I do not know what the cost is we are saying __m__ how much we are going to spend I do not
know, I just do not want the staff to spin their wheels to spend lot of money putting together all of
this whole thing,
Chairperson Kovacic:
I think we are going to know by the time the staff present it to the Council, whether we need a
super majority on anything, We are going to need super majority on any condemnation,
Member Harbicht:
Oh no,.. we are going to run into a lot of cost initially to form the PAC, we have to do all legal
work and if it then comes back to us and it takes a super majority, apparently it is not going to
pass, so why incur those costs? Lets just let the area go like it has been for the past fifteen
years, but it is not my fault.
Chairperson Kovacic:
Do we know now whether it will take the super majority?
Mr. Penman:
Well, we have not... we are not really contemplating residential based on our surveys, so frankly
we will try to avoid having to form a PAC, because of the issues related residential relocation,
but we have to go down there and do a more detailed survey, What we would propose is to bring
back that information to you along with more specific proposals from the various consultants,
that we would need to utilize as to what it will cost, so at that point, we will be able to tell you
what process we need to follow, PAC or no PAC, obviously will be the Councils ultimate call in
what those cost would be and then you could provide that direction at that time, But we did not
want to go seek consult proposals, identify project area, looking residential without...
Chairperson Kovacic:
You are not gonna be spending much money to get it back....
Mr. Penman:
Initial part will be the staff time, to bring back report and get proposals from consulting firms that
we need to assist us, and then bring that back to you with a more definitive budget time frame
and issues,
Member Marshall:
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Don, isn't.. in a matter of time to see what is going to take place, whit what is going on now, we
could re-address this again it that does not move on or take place or all falls through couldn't we I
address this again, and the we could..,
Mr. Penman:
You could do it either way, you could initiate it and at any time you can abandon the process, or
you could wait, I mean it is really the Councils call...
Member Marshall:
But once, this put in redevelopment areas then it is a redevelopment area, isn't it?
Mr. Penman:
But, it will take about nine months or a year to form a project, so, I mean it is Councils call, but
you could stop the process at some point and say we are satisfied, there is things going on down
there that won't necessitate redevelopment or you could wait,
Chairperson Kovacic:
Unless somebody wants to change their vote, I think the staff has the direction to come back with
a formal proposal and then we will have the formal vote on whether to go forward with it or not
our eye is open as far as what it is going to cost, and whether we need any super majorities,
END OF SIDE TWO OF TAPE ONE
Chairperson Kovacic:
That is the issue of refinancing the loan, keeping it the same or using the information,..,..
How long would the Close Session....
City Manager Kelly:
Probably about thirty minutes,
Chairperson Kovacic:
Why do not we break to the Close Session and then come back after the meeting for any further
discussion about Redevelopment issues, Is that okay?
Okay we are now going to Close Session..
Roll call please,
City Clerk Alford:
Council/Agency Member Chandler,
Member Chandler:
I am here, thank you,
City Clerk Alford:
Harbicht?
Member Harbicht:
Here,
City Clerk Alford:
Marshall?
Member Marshall:
Yes,
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City Clerk Alford:
Roncelli?
Member Roncelli:
Yes.
City Clerk Alford:
Kovacic?
Chairperson Kovacic:
Yes, and as I understand it, Mr. Kelly, somebody is going to talk about debt structure and then
Mr, Penman you want to tell us about at least one potential project,
Mr. Penman:
Yes, I was not planning to go through all of the project in the item 4 I just want to highlight a
couple of things first, just for your information as you know Foulger Ford has fallen out of escrow,
so you are aware of what we have been doing, we have identified a number of retailer users that
we think will be highly desirable in Arcadia and we mailed twenty nine (29) lellers to those
retailers across the country, with packets and side information, try to generate some interest.
Much like what we try to do there on the Arcadia Lumber site, so we do not know for sure what
will hit, but we trying to make the retail community aware that this site is available and we are out
there marketing it, so just so you know what we are doing there, On the other site I want to just
focus on, we really have not done much with that in quite some time, at least looking at it,
whether it makes some economic sense is what we want to look at, and that is item f, and that is
the Bekins{Elks property, it is a prominent property in the downtown, the Elks property is on the
tax roll at about five dollars a foot, compared to the, for example, the Foulger Ford site, that is
for sale for twenty eight ($28) a foot. What we are suggesting here is we just want to go out do
some economic analysis of that site, internally, maybe get a little bit of outside assistance to see
if there is any economic value or benefit that could be done in terms of economic to try to do a
project there, We do not know if we can or not, but the reality is one of the most prominent sites
in our downtown is that self storage use and a non profit organization, and maybe a non profit
group may not even want to stay there, we have been told that is a possibility so all we are
saying is that we would like to explore that see what we can come back with,
Chairperson Kovacic:
Any objections, to that.
Member Harbicht:
I think it is a good idea,
Member Chandler:
The American Leagon was once relocated, they seem quite happy..
Chairperson Kovacic:
I refer some of the views on this parcel, is that a public discussion?
Mr, Penman:
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Yes, good question, the Western Security Bank, as you may recall, I believe it was in December,
the owner of the property the bank had come to the City looking for City support to do a self
storage use on that site, The Council said no, we want it pursued for at least a year or so some I
office type of use we think will be more appropriate for the area, Since then the owners met at
least three times with staff, myself included, to try to promote the idea of self storage site,
however in that time, we also had number of other meetings, we met with brokers, we looked at
possibilities for fitness use on this site, for office industrial storage type of use, so, what we are
encouraged by the fact that there is a lot of interest in that location, it is not just self storage,
because, for the benefit of new members, our feeling was with the Residence Inn and the new
Hilton/Marriott project across the street, we felt that there was a higher and better use for that
location than just self storage, Hopefully what we seen so far is bearing that out, so we continue
working with you folks on that.
Member Roncelli:
We eventually gonna have to buy some property and build some affordable housing, what about
that location?
Mr. Penman:
Well, we actually looked as a possibility at that location, it tends to be a little bit more of
industrial area and the Councils policy is Senior Housing, so when you look at Senior Housing
the thing you want to try to do is provide it close to services and amenities that the Seniors can
take advantage,
Member Roncelli:
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Well, it is close to Restaurants,..
Mr. Penman:
It is close to the Restaurants, the only thing that it lacks is a Super Market.
Member Roncelli:
And the Medical.
Mr. Penman:
Well, we do have a .. fortunately we have such an excellent Dial-a-Ride program, we have a
great transpiration program, so that tends to mitigate some of those things, some communities
do not have such a good program,
Member Marshall:
Medical is not that far, we have big Medical buildings, lot of they use it is right there by the
Hospital, is not that far.
Member Roncelli:
I give up..,
Mr. Penman:
The site is a little small, there is sort of a certain threshold for Senior Housing, probably is about
two acres isn't it, Pete, that is what we are hearing?
Member Roncelli:
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You mean, no more than two?
Mr. Penman:
No, at least two .., but the Johnson property behind it is larger, that may be a possibility, but then
again it is tough against the freeway and the water tanks and, you need a certain size to make
the economics work, so they can provide the amenities for the Seniors in there, so it is probably
minimum to two acres, that is what we need, but we are exploring different locations throughout
the community trying to find appropriate site,
Member Roncelli:
How long you are going to look for other people?
Mr. Penman:
A year is what the date that the Council set, we are about half way through that time period now,
Council Member Roncelli:
Okay, so it was six months ago ..,
Mr. Penman:
Yes, that was December when it came before the Council...
Member Roncelli:
So, if nothing happens in six months from now, you probably are going to say that this is a good
idea..,
Mr. Penman:
I am sure that they will come back and remind us of that.
City Manager Kelly:
We may never say that this is a good idea, but ....,
Member Roncelli:
Speaking for myself, I am against self storage in that property now, a year from now, ever,
Surrounded by Hotels, does not make sense.. That's a good piece of property,
Chairperson Kovacic:
Okay, any other questions about any of the other opportunity sites in the package? Okay we are
going to move on to Refinancing/Financing{Debt Repayment to City page twenty five (25),
Mr. Penman:
Yes, we have provide some information for you regarding the possibility of doing financing or
refinancing, we look at two different ways, one is simply refinancing the existing debt and what
that saving money in terms of our debt service and cash flow, the answer to that is minimal
about twenty five ($25,000) to thirty ($30,000) thousand dollars, so we spend a lot of money in
consultants and bond attorneys to refinance to save twenty five ($25.000) thousand dollars, so
that does not make any economic ,..,
Member Roncelli:
You say refinance, you mean same principle we just get a better rate, it that right?
Mr. Penman:
Correct...
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Member Harbicht:
What is the rate,
Mr. Penman:
It floats, it is probably five (%5) or six (%6) six percent in that range right now, tax exempt.
Member Harbicht:
Why couldn't can the City just loan them the money, because we do not get six (%6) percent of
our money now?
Mr. Penman:
Yes, we would probably get pretty close to what you would get through local Agency Investment
Fund, so, our point was we would spend a lot of time and money, because we have to hire bond
attorneys and underwriters and we would save twenty five ($25,000) thousand a year would not
be worth it, but the other option though, which is addressed is as you know we generate about
$2.4 million tax increment today, and the debt service on the existing bonds is three hundred -
three hundred fifty thousand dollars, then we have other annual expenses, If we maximized the
amount of tax increment we receive, about $1.2 million, we could net out about $11 million
dollars in "new" money, Okay, we get $2.4 million, we have about a million dollars in expenses,
paying for City overhead staff, overhead and Agency, project cost for Downtown, thing of that
sort, Housing Set Aside fund four hundred thousand for that..
Member Roncelli:
So that you are down to seven hundred thousand, so what is the total cost?
Mr. Penman:
We are about $1,1 million,
Member Roncelli:
So take out five hundred thousand, it is what you are saying?
Mr. Penman:
No, I did not explain it very well. Why don't you turn to page twenty nine (29),
Now if you look at where it says $2.4 million tax increment, now look at the Economic
Development Operations seven hundred eighty three ($783,000) thousand, then look at the
Business Programs of two hundred forty ($240,000) thousand and Miscellaneous, right about
$1,1 - $1,2 million there, then you have the Housing Set Aside, that leaves around $1,0 million
dollars of tax increment that we could bond against, okay, now if we took the amount of money
we have available in tax increment and bond it against that we could generate about $11 million
dollars of new money,
Member Roncelli:
You are saying that we borrow against it.
Mr. Penman:
Right, there is a tax we borrow and use a tax increment to pay debt.
Member Roncelli:
So we borrow $11 million dollars,
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Mr. Penman:
We borrow $11 million dollars, and we have the capacity right now with our tax increment to do
that. We are not suggesting that we go out and do that but, it does dovetail in to the next
discussion about the Civic Center, if you are looking at resources, we could potentially do
something in Civic Center, such as a Police facility, as well as some projects my point simply is
that there are resources there that you could tap into to do that, because the tax increment grown
the only bond issue that we have now the debt service,
Member Roncelli:
And we still have to payoff at the same time, is that what you saying?
Mr. Penman:
No, we go out twenty, twenty-four, the payoff date now is twenty-fifteen,
Member Roncelli:
Now, if we did not have a Redevelopment Agency, and we have the same debt structure that we
have now, I do not know if that is possible could the City do this as well, or it is something that
unique to a Redevelopment Agency,
Mr. Penman:
Well, the Redevelopment Agency does not need voters approval the only thing the City can do is
the Certificate of Participation, however, Certificate of Participation is great but you still need a
funding source to payoff the debt. In this case the Agency would be the funding source using
the bond proceeds,..
Member Roncelli:
The tax increment is a steady source of ....
Mr. Penman:
Exactly, you would pledge your tax increment, if the City sold bonds through a Certificate of
Participation it will do that, we have to pledge a revenue source which would have to be General
Fund or some other source such as that,
Member Harbicht:
How can we use the money generated by that bond sale for say a Civic Center or the Police
Station,
Mr. Penman:
Well, it is adjacent to the project area we would have to make a finding of benefit we talked to
our legal counsel and we would not suggest that we do the whole thing, or take all the money,
but we can probably make some finding of benefit to the project area and utilize some of those
funds to pay for a Police Station, It is not allowed for City Hall, it IS illegal for City Hall, but for a
Police Station you could do it.
You have to look at the project cost of the project first, so lets say it is a fifteen million dollar
building, then you have to come up with percentage that we believe is justified based on benefit
to the project area, to the cost of service number of businesses.., But it is not incommon to use
the Redevelopment money to pay for public facilities,
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City Manager Kelly:
So they are of benefit, a Police Station is of clear benefit and the Fire Station and things of that
nature, It is the way to raise money to buiid a facility and have a guaranteed funding source, I
This will cost us fifteen million dollars, Forty five and fifty five thousand square feet, and it
depend to the kind of jail we build or don't build,
Member Roncelli:
It is that a kind of jail, where you jail other Cities people, so that you charge them?
City Manager Kelly:
The fifty thousand is a larger which allows that to occur and then you charge other cities, we
have to do a very careful cost analysis benefit because if we ---
Member Roncelli:
Do we want to do that?
City Manager Kelly:
Well, we have to do study it. If we sign a contract with some Cities and they withdraw got an
empty jail.
Member Roncelli:
What is an adequate size?
City Manger Kelly:
Probably forty five thousand square feet, approximately,
Member Roncelli:
What do they have now?
City Manger Kelly:
Twenty five thousand, and that, includes the trailer,
Member Roncelli:
So it will be double what we have now,
City Manager Kelly:
The Station was designed for I think thirty police officers, we have almost sixty or seventy, Build
in 1952,
Member Gail:
What is the population right now,
City Manger Kelly:
Fifty thousand,
Member Chandler:
That is not a good way, that does not make any sense at all. The jail is a big issue, the
communications what you do with that is a big issue, and the records,.... This modern Police
Stations are a whole different can of worms than the old one you know, you and I could have
built an old one,
(Inaudible)
Mr. Penman:
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When we are not making any suggestions for getting it financed, all we are simply saying is the
increments have grown to a point, you have some options you could use it to pay debt or make
public improvements of projects and this is for your information at this point..
Member Roncelli:
What the other method is, that you go to the public and say well, this is what we need,
Chairperson Kovacic:
We asked you once, we asked you twice....
Okay anything else, any other questions? about Redevelopment, any other concerns, any
comments...... No
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