HomeMy WebLinkAboutR43-Economic Development Agency
ECONOMIC DEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARDINO
FROM:
Maggie Pacheco, Director SUBJECT:
Housing and Community Development
August 14, 2001 0 [i','~' l'i~WI,~ L
EXCLUSIVE RIGHT TO NEGOTIATE
WITH GFR ENTERPRISES, INC.-
GLACIERS RESIDENTIAL PROPERTY
IN NORTH SAN BERNARDINO
DATE:
___________________________________~___M_________________________________________________________....~__
Svnopsis of Previous Commission/Council/Committee Action(s):
On July 26,2001, the Redevelopment Committee recommended that this item be sent to the Community Development
Commission for approval.
Recommended Motion(s):
(Community Development Commission)
MOTION:
RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION AUTHORIZING AND
APPROVING AN EXCLUSIVE RIGHT TO NEGOTIATE AGREEMENT WITH GFR
ENTERPRISES, INC., RELATED TO AP#261-191-27,28,29 AND 30, COMMONLY KNOWN AS
THE GLACIER'S PROPERTY IN NORTH SAN BERNARDINO, ("THE SITE") FOR SINGLE
F AMIL Y HOUSING DEVELOPMENT.
Contact Person(s): Gary Van Osdel/Maggie Pacheco
Project Area(s) N/A
Phone:
663-1044
Ward(s):
Five (5)
Supporting Data Attached: I!'I Staff Report I!'I Resolution(s) I!'I Agreement(s)/Contract(s) I!'I Map(s) I!'I LetterlMemo
Amount: $
N/A
Source:
N/A
SIGNATURE:
Budget Authority: N/ A
f11.{?~
Maggie Pacheco, Director
Housing and Community Development
- CommissioniCounclINotes:-------------------------.-----------------------------------------------------------
GVO:MP:lag:08-20-01 GFR
COMMISSION MEETING AGENDA
Meeting Date: 08/20/2001
Agenda Item Number: A "3-
. .
ECONOMIC DEVELOPMENT AGENCY
STAFF REPORT
---------------------------------------------------------------------------------------------------------------------
Exclusive Rie:ht To Nee:otiate With GFR Enterurises. Inc.- Glaciers Residential Property In
North San Bernardino
BACKGROUND
In 1991, the City of San Bernardino formed a Mello-Roos Community Facilities District
(CFD#995) and issued bonds in order to encourage single-family residential development within
certain portions of the Verdemont Area of north San Bernardino east of the 1-215 freeway. The
CFD was structured to include properties owned by four (4) separate developers with four (4)
noncontiguous housing properties that would ultimately accommodate the development of 428
single-family homes. Only one developer was able to build 163 homes which were ultimately
sold to individual homeowners. The other developers were unable to develop their properties.
Consequently, in 1994, the three (3) developers defaulted on the tax payments leaving the 163
homeowners and the City to make the debt service payments on the outstanding bonds.
Because of the financial burden this default created upon the City and the 163 homeowners, in
1999, the City and Agency developed a financing plan that would allow the City to pay off the
outstanding CFD debt. This plan consisted of the Agency issuing Housing Bonds in the
approximate amount of $4.6 million of which the City used to payoff the CFD Bonds and in
exchange the Agency acquired two of the effected properties from the City. One of the properties
purchased by the Agency under the financing plan is commonly referred to as the Glaziers Fund
Property, which consists of approximately 29 vacant acres (the "Vicinity Map") and tentatively
mapped for 110 residential single-family homes (the "Site") (see attached Map of Site).
CURRENT ISSUE
Around March 2001, the Community Development Commission authorized staff to issue
Requests for Proposals (RFP) in order to sell and develop the Site and in May 200 I, staff
solicited and received three proposals from three development entities. These development
entities are: Neighborhood Housing Services of the Inland Empire, Inc. (NHS), Century Vintage
Homes, and G.F.R Enterprises, Inc. Each proposal varied in its deal points and experience, but
all were essentially consistent in their development plans and that was to develop 110 single-
family housing units. Please refer to the attached Summary of all three proposals.
In June 2001 an internal committee consisting of EDA, Development Services Staff and
Councilman Joe Suarez was formed and interviewed the three developers. After considering
each proposal, the Committee was unanimous in recommending that the Agency negotiate with
G.F.R Enterprises, Inc.
GYO:MP:lag:08-20-01 GFR
COMMISSION MEETING AGENDA
Meeting Date: 08/20/2001
Agenda Item Number: -R.:I.1
, .
Economic Development Agency Staff Report
Exclusive Right to Negotiate - GFR
August 8, 2001
Page Number -2-
---------------------------------------------------------------------------------------------------------------------
G.F.R. Enterprises, a California Corporation (the "Developer"), was formed in 1995 by Richard
F. Herrera and Felix Robles Jr. Together the partners have over 25 years of real estate and
development experience. See attached synopsis of the Developer experience. Presently the
Developer is developing a subdivision in Shandin Hills, the Crimson Crest, consisting of 26
single-family homes ranging in price from $170,000 to $275,000. Their total development costs
are approximately $5 million.
The Developer's proposal to the Agency is quite simple in that they propose to purchase the Site
from the Agency at the price of $875,000 with a nominal subsidy of approximately $75,000.
They plan to develop 110 single-family homes, ranging in size from 1500 sq. ft. to 2500 sq. ft.,
and ranging in price from $150,000 to $200,000. Of the 110 homes, 22 homes will be reserved
for low and moderate-income households whose incomes do not exceed 120% of the San
Bernardino County median income. South of the residential lots, the Developer is also proposing
to develop an open green space that will serve as a park for the residential development. Their
total projected development costs are $18 million.
There are a number of items and deal points that need to be considered, negotiated and
determined between the parties such as renewing the tentative parcel map, understanding the
requirements and conditions of the parcel map, infrastructure requirements and giving the
Developer an opportunity to perform their due diligence on project feasibility. Therefore, Staff
is recommending that a 60 day Exclusive Right to Negotiate be authorized between the
Developer and Agency during which time, the Developer and Agency staff will fine tune the deal
points and determine project feasibility. Based on the outcome of these negotiations, Staff may
return to the Community Development Commission with a recommendation to enter into a
Disposition and Development Agreement (DDA) with the Developer to proceed with the
ultimate development of the Site.
ENVIRONMENTAL
Under the California Environmental Quality Act (CEQA) no CEQA action is required for an
Exclusive Right to Negotiate Agreement.
FISCAL IMPACT
The Exclusive Right to Negotiate Agreement does not require the Agency to expend any
financial resources other than Staff time.
GVO:MP:lag:08-20-01 GFR
COMMISSION MEETING AGENDA
Meeting Date: 08/20/2001
Agenda Item Number: -.It cj J
Economic Development Agency Staff Report
Exclusive Right to Negotiate - GFR
August 8, 2001
Page Number -3-
---------------------------------------------------------------------------------------------------------------------
RECOMMENDATION
That the Community Development Commission adopt the attached Resolution.
~,ah~
Maggie Pacheco, Director
Housing and Community Development
GVO:MP:lag:08-20-01 GFR
COMMISSION MEETING AGENDA
Meeting Date: 08/20/2001
Agenda Item Number: ML
1
RESOLUTION NO.
2
3
RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION
OF THE CITY OF SAN BERNARDINO AUTHORIZING AND
APPROVING AN EXCLUSIVE RIGHT TO NEGOTIATE AGREEMENT
WITH GFR ENTERPRISES, INC., RELATED TO AP#261-191-27,28,29
AND 30, COMMONLY KNOWN AS THE GLACIER'S PROPERTY IN
NORTH SAN BERNARDINO (THE "SITE") FOR SINGLE FAMILY
HOUSING DEVELOPMENT
4
5
6
7
8
WHEREAS, the Community Development Commission of the City of San Bernardino
9
(the "Commission") is the governing body ofthe Redevelopment Agency of the City of San
10
Bernardino (the "Agency"), a public body corporate and politic, organized and existing pursuant
11
to the Community Redevelopment Law (California Health and Safety Code Section 33000, et.
12
seq.); and
13
WHEREAS, at the direction of the Community Development Commission, on May 18,
14
2001, Agency Staff received Request for Proposals (RFP's) from Developers for development
15
of the Site and subsequent to such receipt an internal Committee reviewed and interviewed the
16
three (3) Developers. As a result of such interviews, on July 26, 2001, the Committee
17
recommended approval of entering into an Exclusive Right to Negotiate Agreement with GFR
18
Enterprises, Inc. in order to explore the feasibility of developing the Site with 110 single family
housing units ( the "Project").
19
20
BE IT RESOLVED BY THE COMMUNITY DEVELOPMENT COMMISSION OF
THE CITY OF SAN BERNARDINO AS FOLLOWS:
21
22
SECTION 1. The Community Development Commission hereby authorizes and
23
approves execution of a sixty (60) day Exclusive Right to Negotiate Agreement (the
24
"Agreement") by and between the Redevelopment Agency of the City of San Bernardino
25
("Agency") and GFR Enterprises, Inc. ( the "Developer"). A copy of said Agreement is on file
with the City Clerk and is incorporated herein by reference.
-1-
SECTION 2.The Community Development Commission approves the Agreement
2 between the Agency and Developer, and authorizes the Agency Executive Director to execute
3 such Agreement together with such technical and conforming changes as may be recommended
4 by Agency Special Counsel.
5 SECTION 3. The authorization to execute the above referenced agreement is rescinded i
6 the parties to the agreement fail to execute it and return it to the Office of the City Clerk within
7 thirty (30) days following the effective date of this Resolution.
8 IIII
9 IIII
10 IIII
11 IIII
12 IIII
13 IIII
14 IIII
15 IIII
16 IIII
17 IIII
18 IIII
19 IIII
20 IIII
21 IIII
22 IIII
23 IIII
24 IIII
25 IIII
-2-
2
RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION
OF THE CITY OF SAN BERNARDINO AUTHORIZING AND
APPROVING AN EXCLUSIVE RIGHT TO NEGOTIATE AGREEMENT
WITH GFR ENTERPRISES, INC., RELATED TO AP#261-191-27,28,29
AND 30, COMMONLY KNOWN AS THE GLACIER'S PROPERTY IN
NORTH SAN BERNARDINO (THE "SITE") FOR SINGLE FAMILY
HOUSING DEVELOPMENT
3
4
5
6
I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Community
7
Development Commission of the City of San Bernardino at a
meeting
8
,2001, by the following vote to wit:
thereof, held on the
day of
Aves
9
Abstain
Absent
Commission Members:
Navs
10 ESTRADA
11
LIEN
12 MCGINNIS
13
SCHNETZ
SUAREZ
ANDERSON
MC CAMMACK
14
15
16
17
18
Rachel G. Clark, City Clerk
19
The foregoing resolution is hereby approved this
20
day of
,2001.
21
22
Judith Valles, Chairperson
Community Development Commission
City of San Bernardino
23
-3-
24
25 By:.
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LEGEND:
10NING: RS - Rl:SIDENTIAL SUBl.IlBI.N
TOTAL LOT COWT:
LOTS I - 13: 10. BOO S. f. l'fiJ, V {<-)
LOTS H: 110: 7.200 s.r. t~~. I!-a 0
110 LOTS
UINIIIUIl LOT SIZE:
THOIlAS OROS IW' OOOK: PAGE NO. ~9. GRID E-<
CITY OF SI.N BERNARDINO. CALIFORNIA
PlI.N PRl:P/JlE~ 12/30/99
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35 48 65 72 87 103
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G.F.R. ENTERPRISES ..........................
419 NORTH THIRD AVENUE' UPLAND. CAUFORNIA 91786. Telephone 909.949.1400' Fax 909.949-6091
G.F.R. Enterprises, a California Corporation, was formed in 1995 by Richard F. Herrera
and Felizardo Robles, Jr.. G.F.R. Enterprises is an experienced and accomplished
institution encompassing all aspects of real estate brokerage and development.
Richard F. Herrera is the President and founder of G.F.R. Enterprises. He graduated
from California State University of Fullerton with a Bachelor of Arts Degree in Criminal
Justice and Social Sciences. He also holds a General Contractors License, a Concrete
Contractors License, a Masonry Contractors License, and a Real Estate License. He
has owned his own contracting company since 1978 and has successfully established a
large client base, resulting in a referral rate of 70%. Herrera has provided custom
contracting services for homes with market values of over 1.2 million, and is skilled and
experiences in a wide variety of contract work ranging from 5 to 20 home developments.
mini-malls and shopping centers. His contracting proficiency and knowledge are an
integral aspect of G.F.R. Enterprises.
Felizardo Robles, Jr. is the Vice-President and founder of G.F.R. Enterprises. He
graduated from California Polytechnic University of Pomona with a Bachelor of Science
Degree in Social Sciences. He also holds a Real Estate Brokers License and has been
licensed to sell real estate in the state of California since 1976. After receiving his
license, Robles averaged over $15 million in sales per year of residential, raw land and
income producing properties. From 1976 to 1983 Robles was hired by several
developers to locate land for developmental use. These acquisitions resulted in the
successful completion of numerous residential and commercial properties. Robles also
assisted in the selling and leasing of these properties upon their completion. In 1984,
Robles founded Golden West Investments, a real estate brokerage company, which
aided several institutions with the marketing of their foreclosure properties. Robles also
coordinated all aspects of the rehabilitation process of said properties. These
institutions included: American Savings Bank, Beneficial Finance Company, Bank of
America, E.M.C., Fannie Mae, Invescor Inc., Household Finance, Sanwa Bank &
Standard Federal. In 1988, Robles founded Golden Pacific Industries, a real estate
development company which completed severaL residential projects in the Inland
Empire, including a 35,000 square foot retail center in the City of Upland. His real
estate brokerage and development experience is a significant contribution to the
success of G.F.R. Enterprises.
G.F.R. Enterprises is a company built on honesty and integrity and every member of the
G.F.R. team is dedicated to excellence. This commitment can be seen in each home
through its craftsmanship, design characteristics, and close attention to detail. G.F.R.
Enterprises wants every family to achieve their dreams. They build more than a house.
They build a home. They build a future that will be shared for generations to come.
3
MINUTES
REDEVELOPMENT COMMITTEE OF THE
ECONOMIC DEVELOPMENT AGENCY
CITY OF SAN BERNARDINO
REGULAR MEETING
OCTOBER 5, 2000
BOARD ROOM
The regular meeting of the Redevelopment Committee of the Economic Development
Agency of the City of San Bernardino was called to order by Council Member Anderson at 11:37
a.m., Thursday, October 5, 2000, in the Economic Development Agency Board Room, 201 North
"E" Street, Suite 301, San Bernardino, California.
ROLL CALL
Roll call was taken by Secretary Lisa Gomez with the following being present: Council
Members Anderson, Estrada and Suarez; Senior Assistant City Attorney Carlyle; Secretary
Gomez. Absent: None.
Also present: Executive Assistant to the Council Carlos; Housing and Community
Development Director Pacheco; Agency Special Counsel Holman; Ernie Vincent, Century
Crowell; Dave Cooper, Century Crowell; Harry Crowell, Century Crowell; John Pavelak,
Century Crowell; Charles E. Wessman, Mellon Johnson & Pearson CPA.
1. PUBLIC COMMENTS
There were no public comments at this meeting.
2. MINUTES
Council Member Estrada made a motion, seconded by Council Member Suarez, and
unanimously carried that the minutes of the Redevelopment Committee meeting of September 7,
2000, be approved as submitted in typewritten form.
4. TERMINATION OF MEMORANDUM OF UNDERSTANDING BETWEEN THE
COMMUNITY DEVELOPMENT COMMISSION AND THE CONVENTION &
VISITORS BUREAU
Council Member Suarez stated that he is a member of the Board of Directors for the
Convention & Visitors Bureau and abstained from voting on this item.
Council Member Estrada made a motion, seconded by Council Member Anderson, that
Redevelopment Committee recommend that the Memorandum of Understanding between the
Community Development Commission and Board of Directors of the Convention & Visitors
Bureau be terminated. Abstain: Suarez
1
10/05/00 t-
3. STATUS OF NEGOTIATIONS - ARROW VISTA PROJECT BY CENTURY
HOMES (PRESENTATION)
Housing and Community Development Director Pacheco stated that the recommendation
listed on the agenda was prepared prior to Agency Staff knowing that the developer could not
proceed to develop Arrow Vista without the addition of the Agency Glacier Property until staff
received the October 2, 2000 letter from Century and that Century's position was contrary to
their prior proposal of September II, 2000.
Ms. Pacheco gave and provided a brief verbal/written history on the chronology of events
with Century Crowell and also recommended termination of the Agreement with Century.
Council Member Estrada asked what was the value of the Glacier Property.
Ms. Pacheco stated that the property is currently being appraised and could not give a
precise value of the property; however, she further stated that the Agency purchased the property
from the City at an approximate cost of $850,000.
Discussion ensued regarding the addition of the Glacier Property to the Century Crowell-
Arrow Vista Development.
Ernie Vincent, Century Crowell, referenced the letter and clarified that Century Crowell
would have the capability once escrow is closed to build 24 homes. He stated that the September
II, 2000 letter indicated that Century Crowell had spoken to the Agency staff several times
regarding the Glacier Property. He stated that costs have risen, the market has not improved, and
thus Century Crowell has experienced higher costs without raising the price of the homes. He
further discussed that with the addition of the home on Susie Lane, school fees and the additional
cost to improvements on 19th Street, Century Crowell would generate a 2% profit margin on the
Arrow Vista Project.
John Pavelak, Century Crowell, stated that Century Crowell has been a homebuilder in
the City of San Bernardino since 1984 and discussed the various projects Century Crowell has
worked on in the City and reiterated the loss Century Crowell would incur and for this reason
could not proceed with Arrow Vista.
Ms. Pacheco reiterated that in the letter dated September II, 2000 from Century Crowell,
it clearly stated that Century Crowell was ready to move forward without the Glacier Property
and again stated that the Glacier Property would not be included as part of the deal. Ms. Pacheco \,
further stated that once Century has proven its credibility on the Arrow Vista Project, staff would
then be in the position to discuss and consider the development and sale of the Glacier Property.
Discussion ensued regarding the September II, 2000 letter and the inclusion of the
Glacier Property as part of the proposal.
2
10/05/00 'l
Council Member Estrada made a motion, seconded by Council Member Suarez, and
unanimously carried that if a commitment is not received from Century Crowell by the end of
business today, that the existing Agreement be terminated on the Arrow Vista Project; if an
acceptable commitment is received, the Committee would recommend a public hearing on
November 30, with an amended Disposition and Development Agreement.
5. CLOSED SESSION
There was no action taken on this matter.
6. ADJOURN CLOSED SESSION/MEETING
At 12:31 p.m, the meeting adjourned. The next regular meeting of the Redevelopment
Committee will be held at 11:00 a.m., Thursday, October 19, 2000, in the Economic
Development Agency Board Room, 20 I North "E" Street, Suite 30 I, San Bernardino, California.
By:
No. of Items: Six
No. of Hours: 54 minutes
Lisa Gomez
Secretary
3
10/05/00
l-
THE REDEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARDINO
EXCLUSIVE RIGHT TO NEGOTIATE FOR PROPERTY
ACQUISITION AND REDEVELOPMENT ASSISTANCE
(G.F.R. ENTERPRISES, INC.)
THIS EXCLUSIVE RIGHT TO NEGOTIATE FOR PROPERTY
ACQUISITION AND REDEVELOPMENT ASSISTANCE, is dated as of AUGUST
2001 (this "Agreement") and entered into by and between G.F.R.
ENTERPRISES, INC., a corporation (the
"Developer" ), and the REDEVELOPMENT AGENCY OF THE CITY OF SAN
BERNARDINO, a public body corporate and politic, pursuant to Health
and Safety Code Sections 33000, et seq. (the "Agency"), to
coordinate mutual planning and consideration of the sale,
acquisition and redevelopment of certain real property presently
under the control of the Agency, generally described as
and more specifically described in
Exhibit "A" attached hereto and incorporated herein by this
reference (the "Site"), upon the following terms and conditions:
-- RECITALS
WHEREAS, the Site is comprised of approximately 29 acres,
subdivided into 110 lots, and is located between Olive and
Irvington Avenues and Gregory Street in the northern portion of the
City of San Bernardino, and commonly referred to as City of San
Bernardino Tentative Tract No. 15407.
WHEREAS, the Developer and the Agency believe that
consideration of the final logistical details of the proposed
disposition of the Site by the Agency to the Developer on the
general terms outlined in the Developer's Response to Request for
Proposals dated May 18, 2001 (the "Proposal") is necessary and
appropriate, a true and correct copy of the Proposal is attached to
this Agreement as Exhibit "B" and incorporated herein by this
reference.
WHEREAS, a plot plan showing the general location of the Site
in relation to surrounding lands, together with a legal description
of the Site is attached hereto as Exhibit "A."
SB2001:23500.1
1
NOW THEREFORE, IN VIEW OF THE GOALS AND OBJECTIVES OF THE
AGENCY RELATING TO THE IMPLEMENTATION OF ITS REDEVELOPMENT HOUSING
PLAN, THE IMPLEMENTATION OF THE NORTHWEST REDEVELOPMENT PLAN AND
THE COVENANTS AND PROMISES OF THE PARTIES RELATING TO THE SITE, AS
SET FORTH HEREIN, DEVELOPER AND THE AGENCY AGREE AS FOLLOWS:
1. Developer Acknowledqements: The Developer hereby
acknowledges and agrees that no provision of this Agreement shall
be deemed to be an offer by the Agency nor an acceptance by the
Agency of any offer or proposal from the Developer to convey any
interest in the Site to the Developer. Each of the various studies
relating to the Site that may be undertaken by the Developer, in
its discretion, regarding any matter relating to the Site shall be
the sole responsibility of the Developer and no such study shall be
deemed to have been undertaken for the benefit of the Agency.
2. Term of Aqreement. The rights and duties of the
parties established by this Agreement shall commence on the seventh
(7th) calendar day following the date of both the approval of this
Agreement by the Agency and the acceptance of this Agreement by the
Developer, as provided in Paragraph 21, and, thereafter, this
Agreement shall automatically terminate and be of no further force
or effect sixty (60) days after such commencement date, unless
prior to that time:
(i) the parties execute a separate disposition and
development agreement (the "Site DDA") for a specific
program of disposition, reuse and redevelopment of the
Site to be undertaken in accordance with the general
terms of the PROPOSAL, other relevant affordable
housing development community redevelopment covenants
acceptable to the Agency and such other terms and
conditions acceptable to the parties, in which case
this Agreement will terminate on the effective date of
the Site DDA; or
(ii) the parties each agree to extend the term of this
Agreement to a specific date, subject to the Agency
first making a finding that satisfactory progress is
being made to complete the logistical details of the
acquisition of the Site by the Developer, as determined
in the Agency's sole and absolute discretion.
582001:23500.1 2
The initial term of this Agreement (and all extensions of
time approved by the Agency) is referred to in this Agreement as
the "Negotiation Period".
3. The proiect. The Developer hereby agrees to take
all reasonable actions required or necessary for determining the
feasibility of the reuse and redevelopment of the Site for the
development of affordable single family housing (the "Project") at
its sole cost and expense. A conceptual description of the Project
is set forth in the PROPOSAL (Exhibit "B"). During the Negotiation
Period the Developer is responsible for refining the description of
the Project and timely presenting the revised project description
to the Agency for its review and consideration. The parties each
acknowledge that the task of refining the Project description a
deliberative process requiring consideration of numerous different
elements. The parties further acknowledge that the completion of
this process as it relates to the Project description may require
the parties to consider various alternate structures for the
purchase and sale transaction for the Site, in order to promote the
affordable single family housing goals for the Project, on terms
that are economically feasible and mutually satisfactory to the
parties.
5. Obliqations of the Developer. During the
Negotiation Period, the Developer shall proceed diligently and in
good faith to:
a. Review, comment on and submit to the Agency
Executive Director an executed copy of the Site DDA by a date no
later than sixty (60) days after the approval of this Agreement by
the Agency (or such later date corresponding to an authorized
extension of the Negotiation Period). The Site DDA shall
incorporate the relevant provisions of the PROPOSAL and such other
terms and conditions acceptable to the Developer and the Agency, in
the sole and absolute discretion of the parties, and shall be
subject to no conditions or contingencies on the part of the
Developer, except final approval of the Site DDA by the governing
board of the Agency, completion of any agreed upon due diligence
investigations and the delivery of a policy of title insurance by
the Agency in favor of the Developer with respect to the Site;
b. Prepare and complete reuse and redevelopment
marketing plans and feasibility studies, as the Developer, in its
discretion, believes are indicated;
882001:23500.1
3
c. Keep the Agency advised on the progress of the
Developer in completing its obligations under this Agreement, on a
regular basis or as requested by Agency staff.
6. Aqency Not To Neqotiate With Others. The Agency
acknowledges that it, currently, deems the disposition, reuse and
redevelopment of the Site to be necessary and that the Developer
appears to be well qualified to undertake the task of finalizing
the logistical details relating to the sale, acquisition, reuse and
redevelopment of the Project on the Site in a manner that is
compatible with the objectives of the Agency's Redevelopment
Housing Plan and the Northwest Redevelopment Plan.
During the Negotiation Period, the Agency shall not
negotiate with any other person or entity regarding either the
disposition of the Site or the reuse and redevelopment of the
Project on the Site. The term "negotiate", as used herein, shall
be deemed to preclude the Agency from accepting any other offer or
proposal from a third party to either acquire any interest in the
Site (in whole or in part) or redevelop the Site, and from
discussing other reuse and redevelopment plans for the Site with
third persons or entities; provided, however, any person may submit
and the Agency may consider any proposal for the disposition and/or
redevelopment of any lands adjacent to the Site.
During the Negotiation Period, the Agency shall not be
precluded, however, from furnishing to persons or entities
unrelated to the Developer information in the possession of the
Agency relating to the redevelopment of any other land owned or
controlled by the Agency in close proximity to the Site and related
to the implementation of the Redevelopment Housing Plan and
Northwest Redevelopment Plan. Implementation of the Northwest
Redevelopment Plan and the Redevelopment Housing Plan shall remain
in the sole and exclusive purview of the Agency to administer. The
Agency may also provide any other information in its possession
that would customarily be furnished to persons requesting
information from the Agency concerning its activities, goals, and
matters of a similar nature or as required by law to be disclosed,
upon request.
7. Aqency Cooperation. During the Negotiation Period
the Agency shall use its best efforts to:
a. Assemble, at the request of the Developer, written
materials and documents relating to the Site that are in the
582001:23500.1 4
possession of the Agency or reasonably available to the Agency.
The Agency shall also provide appropriate comment to the Developer
with respect to one or more conceptual development plans, as may be
proposed by the Developer for the proj ect, and the reuse and
redevelopment of the Site, including, but not limited to,
conceptual plans or studies of vacation, realignment or abandonment
of public property and facilities, the installation and improvement
of public improvements and the completion of all required
environmental evaluation of the Project.
b. Provide the Developer with limited access to the
Site during the Negotiation Period for the purpose of conducting
customary due diligence investigations thereon, including
environmental investigations of the subsurface or any structure
thereon, subject to the customary terms and conditions of an
environmental investigation and inspection license agreement to be
agreed upon by the Agency and the Developer.
8. Neqotiation of Site DDA. During the Negotiation
Period the Agency and the Developer shall negotiate diligently and
in good faith to prepare and enter into the Site DDA. Both of the
parties shall exercise best efforts to complete discussions
relating to the final terms and conditions of the Site DDA and such
other matters, as may be mutually acceptable to the parties for the
reuse and redevelopment of the Project on the Site.
9. Consideration for this Aqreement and Reservation of
Riqhts. In consideration for the Agency I s entering into this
Agreement, the Developer will, on a best efforts and good faith
basis, undertake its obligations under this Agreement. The parties
agree that, if this Agreement terminates for any reason, or the
Agency fails to extend the Negotiation Period, or a Site DDA is not
finally approved by the Agency, for any reason, neither party shall
be under any further obligation to the other regarding the
disposition, acquisition, reuse, redevelopment or development of
the Project or the Site.
10. Planninq and Desiqn - Related Acknowledqrnents of the
Parties. Development standards and design controls for the Project
shall be established between the Developer and the Agency, and it
is understood that the Project and the reuse of the Site shall
conform to Agency and City of San Bernardino development and
architectural standards. Drawings, plans and specifications for
the Project shall be subject to the approval of the Agency, which
approval shall not be unreasonably withheld. The Agency shall
882001:23500.1
5
fully cooperate with the Developer I s professional associates in
providing information and assistance in connection with the
Developer I s preparation of drawings, plans and specifications.
Nothing in this Agreement shall be considered approval of any plans
or specifications for the Project or the Project itself by either
the Agency or the City.
11. Developer Financial Disclosures. The Developer
acknowledges that it may be requested to make certain confidential
financial disclosures to the Agency, its staff or legal counsel, as
part of the financial due diligence investigations of the Agency
relating to the potential disposition of the Site to the Developer.
The parties recognize that such financial disclosures may contain
sensitive information relating to other business transactions of
the Developer, that the disclosure of such information to third
parties could impose commercially unreasonable and/or anti-
competitive burdens on the Developer and, correspondingly, diminish
the value or fiscal benefit that may accrue to the Agency upon the
disposition of the Site to the Developer, if terms for such
disposition are mutually agreed upon. Accordingly, the Agency
agrees to maintain the confidentiality of any business records
described in Government Code Section 6254.15, as may be provided by
the Developer to the Agency or its consultants, to the maximum
extent permitted by law. The Agency shall not provide a copy of
any business record protected from disclosure under Government Code
Section 6254.15 to a third party, unless the Developer first
consents to such disclosure in writing or, unless a court of
competent jurisdiction copels disclosure.
12. Developer Acquires No Interest in Real Property or
in the Site from the Aqency. The Developer hereby acknowledges
that it has not acquired and will not acquire by virtue of the
terms of this Agreement, any legal or equitable interest in real or
personal property from the Agency.
13. Nondiscrimination.
discriminate against nor segregate
on account of race, color, creed,
handicap, national origin or
obligations under this Agreement.
The Developer shall not
any person, or group of persons
religion, sex, marital status,
ancestry in undertaking its
SB2001:23500.1
6
14. Default.
a. Failure or delay by either party to perform any
material term or provision of this Agreement shall constitute a
default under this Agreement; provided however, that if the party
who is otherwise claimed to be in default by the other party
commences to cure, correct or remedy the alleged default within ten
(10) calendar days after receipt of written notice specifying such
default and shall diligently complete such cure, correction or
remedy, such party shall not be deemed to be in default hereunder.
The party that may claim that a default has occurred
shall give written notice of default to the party in default,
specifying the alleged default. Delay in giving such notice shall
not constitute a waiver of any default nor shall it change the time
of default; provided, however, the injured party shall have no
right to exercise any remedy for a default hereunder without
delivering the written default notice as specified herein.
Any failure or delay by a party in asserting any of its
rights and remedies as to any default shall not operate as a waiver
of any default or of any rights or remedies associated with a
default. Except with respect to rights and remedies expressly
declared to be exclusive in this Agreement, the rights and remedies
of the parties are cumulative and the exercise by either party of
one or more of such rights or remedies shall not preclude the
exercise by it, at the same or different times, of any other rights
or remedies for the same default or any other default by the other
party.
In the event that a default of either party may remain
uncured for more than ten (10) calendar days following written
notice, as provided above, a "breach" shall be deemed to have
occurred. In the event of a breach, the party who is not in
default shall be entitled to terminate this Agreement.
15. [RESERVED -- NO TEXT].
16. Compliance with Law. The Developer acknowledges
that under the Site DDA, if mutually agreeable terms are
established, it shall be required (among other things) to carry out
the construction of certain improvements in conformity with all
applicable laws, including all applicable planning and zoning laws,
environmental planning and safety laws and federal and state labor
standards.
SB2001:23500.1
7
17. No Assiqnment of Aqreement. This Agreement shall
not be assigned by the Developer (except to a new or successor
entity, in which the principals of the Developer have an ownership
interest and management control), without the prior written
approval of the Agency, which the Agency may grant or refuse in its
sole discretion.
18. Aqency Support.
providing the Developer with
possession related to the Site,
be obligated to incur any cost
The Agency shall cooperate in
appropriate information in its
provided that the Agency shall not
or expense therefor.
19. Required Approvals. No Site DDA between the parties
shall have any force or effect nor shall the Agency be deemed to be
a party to any agreement for the disposition of real or personal
property to the Developer, until the terms and conditions of the
Site DDA are considered and approved by the Agency, following the
conclusion of a public hearing, as required by law.
20. Press Releases. The Developer agrees to discuss any
press releases it may propose relating to the Site with the Agency
Executive Director or his/her designee, prior to publication, to
assure accuracy and consistency of the information.
21. Notice. All notices required hereunder shall be
presented in person or by FAX and confirmed by First Class
certified or registered United States mail with return receipt
requested. Notice shall be deemed confirmed by United States mail
effective the second business day after deposit with the United
States Postal Service. Notice by personal service shall be deemed
effective upon delivery. Either party may change their address for
receipt of notice by notifying the other party in writing.
TO DEVELOPER:
G.F.R.Enterprises,Inc.
419 N. Third Avenue
Upland, California 91786
Attn: Richard F. Herrera, President
(909) 949-1400
TO AGENCY:
Redevelopment Agency of the City
of San Bernardino
201 North "E" Street, Suite 301
San Bernardino, California 92401
Attn: Executive Director
(909) 663-1044
SB2001:23500.1
8
22. Acceptance of Aqreement by the Developer. The
Developer shall acknowledge its acceptance of this Agreement by
delivering two (2) counterpart executed copies of this Agreement
signed by at least two (2) authorized officers of the Developer, on
or before the seventh (7th) calendar day following the approval of
this Agreement by the Agency.
23. Authority. Each signatory to this Agreement
represents and warrants that he or she has the authority to execute
this Agreement on behalf of and make this Agreement binding upon
the principal whom he or she purports to represent. This Agreement
may be executed by the parties in counterparts, all of which
together shall constitute a single agreement.
882001:23500.1
9
IN WITNESS WHEREOF, the undersigned have executed this
Exclusive Right to Negotiate for Property Acquisition and
Redevelopment Assistance on the dates indicated next to each of the
signatures of their authorized representatives as appear below.
DEVELOPER
G.F.R.Enterprises, Inc. ,
a corporation
Dated:
By:
President
Dated:
By:
Secretary
AGENCY
Redevelopment Agency of the
City of San Bernardino
Date:
By:
Gary Van Osdel
Executive Director
APPROVED AS TO FORM:
Agency Special Counsel
882001:23500.1
10
ARROW VISTA - GLAZIERS NEGOTIATIONS
CHRONOLOGY
September 19, 2000
Century Crowell was reluctant to complete negotiations and close on the acquisition of
the Arrow Vista project from RDA without the opportunity to purchase the Glaziers
property. The RDA staff was equally adamant that the Glaziers property was "not on the
table" unless and until Century closed escrow on Arrow Vista. (See attached September
19, 2000 letter from Gary Van Osdel.)
October 5, 2000
The impasse was resolved at the RDA Committee meeting of October 5, 2000. Century
was told that it would have a right to match an offer received by another developer.
Also, once Century had closed on Arrow Vista, Century could negotiate (non-exclusively)
with the RDA on a purchase. The RDA's commitment was to be memorialized in the
Minutes of the meeting per RDA counsel.
October 6, 2000
Century obtains commitment from Tokai bank to finance Arrow Vista and Glaziers (See
attached letter.)
October 13, 2000
On October 13th (correspondence attached), Century reiterated that the right of first
refusal was a condition of completing the Arrow Vista transaction.
October 17, 2000
On October 17th (correspondence attached), Century reiterated that the right of first
refusal was a condition of completing the Arrow Vista transaction.
December 5, 2000
Century received notification that the RDA had decided to put out a public Request for
Proposals ("RFP") on the Glaziers property.
December 11, 2000
Century faxed a letter to the RDA staff, and to attorneys Carlyle and Holman, stating
Century's understanding that the RFP did not over-ride the RDA's commitment to give . / /
Century a right of first refusal on Glaziers. No formal written response wa$lf!Jceived. K/ % D fo J
January 30, 2001
Century closes on Arrow Vista. Construction begins immediately.
,( Jjj
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Rlf-3
March 21, 2001
RFP on Glaziers is put out to public
May 18, 2001
Century responds to RFP.
July 10, 2001
Century makes oral presentation and written outline on RFP response to the RDA
committee. (See attached package.) Century notes increase in plan size to up to 3,000
square feet.
July 18, 2001
Century sends letter to RDA re proceeding on the 38 remaining lots at Arrow Vista
without subsidy from sale of Glazier's property
July 30, 2001
Century is notified that staff is recommending other developer for Glaziers to RDA.
August 9, 2001
Century inquires about status of right of first refusal at RDA committee meeting. RDA
instructs staff to prepare chronology to assure there is no confusion about any official
action and to respond to Century. No response received as of August 17, 2001.
City of San Bernardino
ECONOMIC DEVELOPMENT AGENCY
Redevelopment. Community Development. Housing. Business: Recruitment, Retention, RevitalIzation. Main Street, Inc.
September 19, 2000
John Pavelak, President
CENTURY CROWELL COMMUNITIES, L.P.
1535 South "D" Street, Suite 200
San Bernardino, California 92408
RE: AGENCY OWNED LAND - GLACIER (110 LOTS)
Dear John:
Thank you for your proposal of September 11, 2000 relative to the above subject matter.
Regrettably, at this time, I am not in a position to entertain a proposal from Century on the
Glazier property because we have not come to resolution of the Disposition and Development
Agreement (DDA) issues on the Arrow Vista Project.
Assuming Century and the Agency reach resolution on Arrow Vista, Century has actually closed
escrow on the project, and the Agency has not received any credible proposals, I will be happy to
re-visit your proposal regarding the Glazier Property at such time.
Again, thank you for your interest in the Glacier property. Should you wish to discuss this
matter f",~.her, please call me at (909) 663-1044.
S~)Y,
~:L/
G an Osdel,
Efecutive Director
201 North E Street, Suite 301. San Bernardino, California 92401-1507' (909) 663-1044 . FAX (909) 888-9413
A roKAl BANK
'''~ OF CALIFORNIA
October 6, 2000
RESIDENTIAL CONSTRUCTION FINANCE
800N.Ha~enAyenue,Suite250
Ontario, California 91764-4915
(909) 467-2000
Fax 19091 986-6344
Mr. John Pavelak
Century Crowell Communities, L.P.
1535 South "D" Street, Suite 200
San Bernardino, CA 92408
Re: Arrow Vista 24 proposed single family units
Dear Mr. Pavelak:
I am writing you to clarify our conversation regarding the proposed A<-row Vista Development of 24
single family houses and why we see greater risk in the marketability of this project:
. It is located in an older infill location with a less than average pride of ownership and we are
unsure of the market acceptance of new housing stock.
. The prior attempts at developing the property were apparently not successful.
. Subordinated second trust deed to be carried back by another party. This is an exception to our
bank policy, we do not allow subordinated debt.
However, due to our excellent eleven year borrowing and deposit relationship with Century Crowell
Communities, L.P., and your personal involvement and guaranty in this project we felt we could mitigate
these concerns.
Additionally, we were under the impression that if we assisted you with financing this development, that
you would be able to obtain the approvals necessary to develop the 110 lot Glazier property. The Glazier
property which is also located in San Bernardino, would meet all of our underwriting criteria without any
exceptions.
Please let me know if there is any way we can help resolve the impasse you have reached with the City
of San Bernardino. I think given your company's strength and performance you could successfully
develop both projects in a way that will be beneficial for all parties involved.
~
Nancy 1. pe~
Vice President
OCT. -13' OO(FRI) 13:56
CENTURY CROWELL COMMUNITIES
TEL:909 885 5005
P. 001
TRANSACTION REPORT
Transmission
Transaction (s) completed
DESTINATION DURATION PGS. RESULT MODE
NO. TX DATEITIME
3S4 5135 O' 00' 23' 001 OK N ECM
321 OCT. 13 13'55 909
October 13, 2000
CENTURY
VINTAGE
HOMES
Via Facsimile Transmission (909) 663-2294
Maggie Pacheco
Director, Housing and Community Development
Economic Development Agency
201 N, 'e" Street. Suite 301
San 13emardlno, California 92401
By Century Crowell
RE: Arrow Vista
Dear Maggie:
Pursuant to conversation earlier this week, Century Crowell Is willing to proceed wilh the
sale of Arrow Vista on terms and conditions as agreed since our meeting of August 23,
2000, sUbject to the follOwing additional terms and conditions:
1. Payment to ECA of $114,000 will not be secured or guaranteed, but will be
paid out of first profits from the sales of homes on the 24 lots, prior to profit
distribution to Century Crowell. EDA will not be a joint venture partner, but
will have the same audit rights as a joint venture partner.
2. Century Crowell wlll have an option/right of first refLlsal commitment on the
Glazier's property as extended to us at the EDA Committee meeting on
October 5, 2000 and set forth In the official record of said meeling.
Please call to confirm your receipt of this leUer and 10 discuss bringing the above back to
the EOA CommiUee for approval.
Sincerely,
CENTURY CROWELL COMMUNITIES. LP
FROM: EconoMic Dev Rqenc~
FRX NO.: 91393845135
113-17-813 83:46P P.04
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October 17. 2000
By Centtlry Crowo:l1
VIa Fa~lmile Transmission (909) 663-22!J4
Maggie Paeheco
Director, Housing and ComlTlllnllY Development
Economic Development Agency
201 N. "E" Street, Suite 301
San Bernardino, Cl;Ililomla 924Q1
CENTURY
--
VINTAGE
I-l 0 M E S
RE:
AfToW VIsta
PeClf Maggie:
Pursuant 10 conversatjon earlier this week. Century Crowell is prepElred \D close on
Am:Jw Vil>ta on the following additional tenns and conditions:,
'I. Payment to EDA 01 $114,000 will not bl3 secLlred or 91.laranteed, put will be paid out
of first profits from ll1e sales of nomes onthe 24 lois, prior to profit distribution l:P
COlntury CriJWell. EDA will not be a joint venture pElr\i1er. but will have the ~;;lmfl
audit rightli 'IS a joint ventl.lre p~rtner, through Mellon, Johnson & Reardon. CPA's.
2. Century CrPWell will hllve an "option/right of first refusal' on the Glaziers property as
extended tp us at the EDA Committee meeting on October 5, 2000 and liel forth In
the officisl record of said meeting; specificOIIIY, that once Century Crowell has closed
escrow on Arrow Vista. the Glaziers property will be "baCK on \he table' anc1 !:DA will
negotiate with Century Crowell concerning ils purchE13e/participation on a non.
exclusive basis, and. in any event, whether before or after close of escrow, the EDA
has agreed lh<lt if It receives an acceptable llfflOlr from anotl'1l>r bona fide party,
Century Crowell will hilve a reasonaple opportunity tp match suell offer.
Our lender ha~ indical"d verbally Ihat lhey will proceed wilh'the 10s(1, However. they will
nol give any binding commitment untillhe peckage is submitted \0 the loan commltlBe.
Unfortunately, I cannot give you anything more definite than that, as vlnually all of Qyr
lenders operElte this way.
Please call to confirm yoyr receipt of this lener and to discuSS bringing tM above back to
the EDA Committee,
Sincerely,
Cl:NTURY CROWEl-1. OOMMUNITIES, LP
Cf:NTURY HQMI!:S COMMUNITIES
~rsr
ernest O. Vincent
Vjce President CQrporate Legal
1535 Suulh "11" Street, Sl.iLe 100, San Btrnardinn, C.lifnrnia, 9140B, (9119) 38).6007, F.x (9W) 381-0041
I-BOO-~\JY.{ :I'N'I'L1RYI, hltpj/www.cenluryvin.tage.com
DEC.-12'00tTUE) 09'41
CENTURY CROWELL COMMUNITIES
TEL:909 885 5005
P. 001
TRANSACTION REPORT
Transmission
Transaction (8) completed
DESTINATION DURATION PGS. RESULT MODE
NO. TX DATE/TIME
909+383+9378 QU 00' 23- 001 OK N ECM
646 DEC. 12 09'40
December 11, 2000
Via Facsimile Transmission (B09) 663-2294
Maggie Pacheco
Director, Housing and Community Development
Economic Development Agency
201 N. "EO Street, Suite 301
San Semardino, California 92401
CENTURY
VINTAGE
HOMES
By Century Crowell
RE: Glaziers Union Property - RFP
Dear Ma9gie:
We are in receipt of your letter dated Oecember 5, 2000, wherein you have informed us
that the EDA Commission has approved putting the Glaziers property out to an RFP
sometime in January.
We assume that the Commission's direction In this regarc is consistent with the
Commission's prior commitment (October 5, 2000) to allow non-exclusive negotiations
between EDA and Century Crowell once Arrow Vista has closed, and to allow Century
Crowell a reasonable opportunity to match any other offer received.
Please let me know Immediately If this is not your understanding,
Sincerely,
CENTURY CROWELL COMMUNITIES, LP
CENTURY HOMES COMMUNITIES
~r?
DEC. -11' OO(MONl 17:21
CENTURY CROWELL COMMUNITIES
TEL:909 885 5005
P. 001
TRANSACTION REPORT
Transml ss ion
Transaction(sl comPleted
NO. TX DATE/TIME DESTINATION DURATION PGS. RESULT MODE
635 DEC. 11 li:20 909 384 5135 O. DO' 23" 001 OK N ECI<!
By Century Crowell
December 11, 2000
Via Facsimile Transmission (909) 663.2294
Magsle Pacheco
Director. Housing and Community Development
Economic Development Agency
201 N. "En Street, SLljte 301
San Bernardino, Califomia 92401
RE: Glaziers Union Property - RFP
CENTURY
VINTACE
HOMES
Pear Maggie:
We are in receipt of your letter dated December 5, 2000, wherein you have informed us
that the EDA Commission hllS approved pLllting the Glaziers property out to an RFP
sometime in January.
We assume that the Commission's direction in this regard is consistent with the
Commission's prior commitment (October 5, 2000) to allow non-exclusive negotiations
between EDA and Century Crowell once Arrow Vista has closed, and to allow Century
Crowell a reasonable opportunity to match any other offer received.
Please let me know immediatelY If this is nol your understanding.
Sincerely,
CENTURY CROWELL COMMUNITIES, LP
CENTURY HOMES COMMUNITIES
4r?
_._._ - _~ - 'I!_ _ __.
December 11, 2000
CENTURY
VINTAGE
HOMES
Via Facsimile Transmission (909) 663-2294
By Century Crowell
Maggie Pacheco
Director, Housing and Community Development
Economic Development Agency
201 N. "E" Street, Suite 301
San Bernardino, California 92401
RE: Glaziers Union Properly - RFP
Dear Maggie:
We are in receipt of your letter dated December 5,2000, wherein you have informed us
that the EOA Commission has approved putting the Glaziers properly out to an RFP
sometirne in January.
We assume that the Commission's direction in this regard is consistent with the
Commission's prior commitment (October 5, 2000) to allow non-exclusive negotiations
between EOA and Century Crowell once Arrow Vista has closed, and to allow Century
Crowell a reasonable opportunity to match any other offer received.
Please let me know immediately if this is not your understanding.
Sincerely,
CENTURY CROWELL COMMUNITIES, LP
CENTURY HOMES COMMUNITIES
~r?
Ernest O. Vincent
Vice President Corporate Legal
'J
cc: Oave Gondek, Lewis O'Amato, Brisbois & Bisgaard (909)%83-9378
Diane Holman, Lewis O'Amato, Brisbois & Bisgaard (909) ~83-9378
Huston Carlyle, City Attorney's Office (909) 384-5238 'J
1535 South "D" Street, Suite 200, San Bernardino, California, 92408, (909) 381-6007, Fax (909) 381-0041
1 CA^ 01 TV rt:'t..1TT InVt 1-....~ 1/"..,...... ,...."'.....f-........,j....4-....n-.o ....^......
CENTURY VINTAGE HOMES
CENTURY CROWELL COMMUNITIES
PRESENTATION OF
DEVELOPMENT PROPOSAL
AND STATEMENT OF QUALIFICATIONS
TO DEVELOP AND CONSTRUCT
FAIR OAKS
AT UNIVERSITY HEIGHTS
FOR THE REDEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARDINO
JULY 10, 2001
FAIR OAKS
AT UNIVERSITY HEIGHTS
CENTURY CROWELL COMMUNITIES
DEVELOPER HIGHLIGHTS
. CROWELL INDUSTRIES (HARRY CROWELL) FORMED 1963
. CENTURY HOMES (JOHN PAVELAK) FORMED 1976
. CENTURY CROWELL COMMUNITIES - SINCE 1993
. HEADQUARTERED IN SAN BERNARDINO
. FIFTEEN CURRENT ACTIVE PROJECTS
(INLAND EMPIRE/COACHELLA VALLEY)
. $100,000,000 IN SALES REVENUE AT YEAR END 2000
. PROVEN RECORD OF SUCCESSFUL PROJECTS IN
SAN BERNARDINO:
WHISPERING GLEN
CIMARRON RANCH
ARROW VISTA
112 HOMES 1990
377 HOMES 1992
24 HOMES 2001
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, JUL.-18'01(WED) 08:21
CENTURY CROWELL COMMUNITIES
TEL:909 885 5005
P. 001
TRANSACTION REPORT
Transmission
Transact ion (s) comPleted
NO. TX DATE IT IME DESTINATION
DURATION PGS. RESULT MODE
681 JUL. 18 08:16 98889413
0.04' SO" 003 OK N ECM
CENTURY
VINTAGE
HOMES
July 18, 2001
Via Facsimile Transmission (909) 888-9413
& General Deliyery
By Century Crowell
Maggie Pacheco
Director, Housing and Community Development
E:conomic Development Agency
201 N. "E" Street, Suite 301
San Bernardino, California 92401
RE: Arrow Vista - 38 I-.ots
pear Maggie:
Based on the performancE! of Arrow Vista, and ol.lr recent discussions, Century Crowell
proposes to continue the project on the nearpy 38 I-.ots owned by EDA on the following
terms and conditions:
1. EDA will convey the 38 lots to Century, free and clear of all
encumbrances, including past due taxes.
2.
EDA will assign 38 prepaid sewer capacity rights held by !:DA to Century
for use on the 38 lots,
"
3. E:DA will forgive the note on the Susie I-.ans I-Iouse in the approxim<tte
amount of $115,000. The proceeds of sale will be used for ongoing
project costs for the 38 lots,
4, EDA will, forego all distributions of profits from the Arrow Vista 24
($114,000 per pro forma). All such fu.n~~_will ~e use~ to pay p.roject costs
. _ __L._~ ~r""l ......+ .....,.,,1.6"... ~~
July 18, 2001
CENTURY
VINTAGE
HOMES
By Century Crowell
Via Facsimile Transmission (909) 888-9413
& General Delivery
Maggi~ Pacheco
Director, Housing and Community Development
Economic Development Agency
201 N. "E" Street, Suite 301
San Bernardino, California 92401
RE: Arrow Vista- 38 Lots
Dear Maggie:
Based on the performance of Arrow Vista, and our recent discussions, Century Crowell
proposes to continue the project on the nearby 38 Lots owned by EDA on the following
terms and conditions:
1. EDA will convey the 38 lots to Century, free and clear of all
encumbrances; Including past due taxes.
2.
EDA will assign 38 prepaid sewer capacity rights held by EDA to Century
for use on the 38 lots.
3. EDA will forgive the note on the Susie Lane House in the approximate
amount of $115,000. The proceeds of sale will be used for ongoing
project costs for the 38 lots.
4. EDA will. forego all distributions of profits from the Arrow Vista 24
($114,000 per pro forma). All such fundswill be used to pay project costs
of the 38 lots. First profits up to $114,000 on the entire 62 unit project as
a whole will be allocated to the EDA, with any profits above that amount
going to Century. .
5. EDA will allow Century to roll-over any unused MAP assistance from the
24 lots to the 38 lots, it being understood that no further MAP assistance
on the 38 lots is available.
6. Century will pay school fees as a project cost. All other City Fees as
allowed per City Ordinance will be deferred until close of escrow on
completed homes. Century will guaranty payment of such fees.
7. Century will have 120 days to close escrow upon signing by EDA of a
new DDA reflecting the above. Close of escrow is conditioned on:
1535 South "0" Street, Suite 200, San Bernardino, Glifornia, 92408, (909) 381-600~ Fax~9iJ9'JVj:jjll'jOO41
l-BOO.BUY.CENTURY!, http://w\\.w.centuryvintage.com
a. Approval by City Design Review Committee of the side-yard set-back,
if required.
b. Our continuing ability to pull permits with a lock-in of school fees at
$2.50 per square foot.
c. Securing of new construction loan from Tokai Bank or other lender.
d. City Council approval to proceed with formation of a 1913/1915 Act
Assessment District in the net amount of $7,000 per lot. Century to
obtain such approval or disapproval within 60 days of opening of
escrow.
8. All of the above is based on the assumption that the project will not have
to be built at prevailing wage as a. "public works" project (except for
improvements financed by the assessment district). Accordingly, EDA
will indemnify Century from any prevailing wage claims on the balance of
the project.
Attached for your information is the pro forma reflecting the above. Please review and
get back with me at your earliest convenience.
Sincerely,
CENTURY CROWELL COMMUNITIES, LP
CENTURY HOMES COMMUNITIES
~pf'
Ernest o. Vincent
Vice President Corporate Legal
2
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Monday, Au~st 20, 2001
A2enda Item No. R43
The following is a verbatim transcript of Item No. R43 which was heard by the Mayor and
Common Council of the City of San Bernardino at its joint regular meeting held on Monday,
August 20,2001.
Item No. R43 was titled as follows on the agenda:
Resolution of the Community Development Commission of the City of
San Bernardino authorizing and approving an Exclusive Right to
Negotiate Agreement with GFR Enterprises, Inc., related to AP #261-
191-27,28,29 and 30, commonly known as the <1lacier's property in
north San Bernardino ("The Site") for single family housing
development.
MOTION: That said resolution be adopted.
Van Osdel: Mayor, the Glacier property is a lID-lot subdivision that the Agency became the
proud owners of when we refunded the CFD #995. Subsequent to Commission
action, when the Agency put out an RFP soliciting proposals for development of
the Glacier property, we received three proposals. The committee, composed of
James Funk, Valerie Ross, Ray Casey, Maggie Pacheco, Mr. Suarez, and
myself, interviewed the proponents and made a recommendation to the
Redevelopment Committee, and the Committee is recommending the
recommendation today to enter into an exclusive right to negotiate for
development of the Glacier property with GFR. If you have any questions, Ms.
Pacheco is here to respond to them.
Mayor: Any questions from members of the Council?
McCammack: We were given some additional backup this morning that I've read through. I
am, it looks to me on the surface of this that we might have been in an exclusive
right to negotiate with another developer, previously.
Pacheco:
That is not my understanding. If you reflect back to your packet, we attempted
to give a chronology of some of the issues in the current staff report, but
specifically, back in October of, October 5th, 2000, the Redevelopment
Committee did discuss this matter at length, and back at that time the Committee
pretty much was very clear in my interpretation as to what position they took
with regard to negotiations. And what I recall is that in October of 2000 the
Committee, while they had extensive discussion on possibly giving Century the
1
Mayor:
opportunity to counter-propose for , the committee made no
recommendation with regard to that. In fact, the minutes that are attached to
your staff report reflect the actual Committee recommendation, and as you can
see, from that recommendation there is no discussion or motion to give Century
any exclusiveness regarding the property. Subsequent to the Redevelopment
Committee, March of 2001, we came before the CDC, and at that time you
directed us to go out with an RFP. And we did send that RFP out, as Mr. Van
Osdel indicated, and Century was in fact one of the respondents to the
proposals.
Any more questions?
McCammack: I guess we're missing some of those minutes, maybe, in this backup anyway.
Nonetheless
Mayor:
(Note: There is talking going on, but nothing being said into the mikes.)
While they are conferring, we have several speakers on this item. I'll call you
in the order that I have received them. The first speaker, Ms. McCammack, if
you don't mind I'll proceed.
McCammack: No, go right ahead, Mayor, I'm sorry.
Mayor:
Vincent:
Mayor:
Vincent:
Thank you. The first speaker is Dave Cooper.
Madame Mayor, can we go out of order? We have about four people from
Century Crowell and it will make more sense if I go first.
Sure. OK, whichever order you all wish to come forward.
Good afternoon, Honorable Mayor and members of the Council. My name is
Ernest Vincent. I'm with Century Crowell Communities, 1535 South "D"
Street, Suite 200, San Bernardino; and I'm speaking in opposition to the agenda
item at this time.
In the negotiation on the Arrow Vista project, which Century Crowell is
currently building pursuant to an agreement with the RDA, those negotiations
were finalized at that October 5th hearing. It was a committee meeting, the
RDA Committee, there were extensive negotiations about our concern with
respect to the Glacier's property--that was a property that we really wanted to
do. It was our understanding at that time, that there were a number, or there
were some other offers out from some other builders, and we were concerned
that that opportunity would pass us by.
2
Mayor:
Koon:
The staff had taken the pOSItion at that time that they were not open to
discussing the Glacier's property until we had closed and performed on Arrow
Vista. And our position was that we were concerned in the interim that we
would lose out on the opportunity to have that property. So it was suggested
that we have a right to match an offer that would come in from another
developer, and that was supposed to have been reflected in those minutes. What
happened was that the minutes made simply a general reference to a discussion
regarding the Glacier's property, and were not anymore specific than that.
In subsequent correspondence with the RDA staff in letters from myself, I
reiterated what I stated at the October 5111 meeting, and when I found out that an
RFP was going out I did send a letter asking for clarification. And that is in the
packet that you have. I didn't receive any written response to that letter. I do
recall having a conversation with staff, and I don't remember exactly what was
said, but my understanding was that the Council had spoken as to an RFP and
that was it. There was, as I can recall, never any statement that there was no
longer going to be a right of first refusal or allowing us to match an offer.
I raised this issue on the 9111 of this month at the RDA Committee hearing, and it
was my understanding that staff was going to prepare a chronology, I guess they
did, for your purposes. We don't know at this time if the RDA Committee, or
the Council as a whole, has had adequate time to review this and to make a
decision. We think it's in the City's best interest to allow us an opportunity to
match, because we do have a track record of having performed at Arrow Vista.
So that is what we are trying to fmd out today, is if the Council has looked at
this and has made a decision on it, and if not, we would think it appropriate for
them to delay this item until such time as they have had a chance to really
consider it.
Thank you, Mr. Vincent. Our next speaker, whatever order you wish to take. I
have here Mr. Richard Koon.
Hello Mayor and Council. I'm Richard Koon, I'm an executive vice president
for Invoy Mac Bank. At the time that these projects were done, particularly the
Arrow Vista Project, I was an executive vice president of Tokai Bank of
California. At the time that we looked at financing the Arrow Vista Project, we
were concerned about its location and the relative risk involved in financing a
project of that type. What we eventually agreed to do was to provide the
financing, provided we had the opportunity to also provide the financing on the
Glacier's property at a later date. We proYided Council with the letter that
states that we took some additional risk in financing Arrow Vista property, and
that it was our understanding that we were doing this with right of first refusal
going to Mr. Pavelak of Century Homes and that ultimately, we too, would be
given the opportunity to finance the project. I think if you read the letter
3
Mayor:
Pavelak:
Mayor:
attached by Nancy Pepper, Vice President , out of our Ontario office,
you'll see that's very clearly stated. Thank you.
Thank you, Mr. Koon. Next speaker, Mr. John Pavelak.
Good afternoon, Mayor, Honorable Mayor and members of the Council. My
name is John Pavelak. I'm a principal at Century Crowell Communities, 1535
South "D" Street. I wanted to mention that I am opposed to the Council
granting the exclusive right to negotiate with the other developer. What I
wanted to say, is that when I left that meeting, October 5"', my partner and I,
my partner was there--there was five of us there--we left with the understanding
that we would have right of first refusal to match any offer coming in, which
when I saw that, I said, well, that's going to be a great deal for everybody
involved, the City and so forth there, so now you have the situation where, you
know, that you can get top dollar. But I subsequently found out about the
project, because you, the Council decided to go out for an RFP, so we
responded to that, but always with the thoughts that we had first right of refusal
to match any offer coming in there, which would get the biggest amount for the
City.
The only condition was, at that October 5'" meeting, was that we perform, we
close and we went through on Arrow Vista. You know, Arrow Vista is moving
greatly, we've got a lot of sales out there, we're ready to go in for Phase II
there, the other 38 lots, that we have been talking with the, with staff on that,
it's in Betty Anderson's district there. And I felt we were the best candidate
that could get the project done and also move ahead with the Glacier's and have
a, have a rebound for here, for the City of San Bernardino.
When we reflected the offer, it was asked, for the RFP, the City had indicated,
you know, get us, get us as much as you can, we're in there for, I think we
found out later they had bought the property for $850,000. I think there was an
appraisal being done, but we never saw that, so our offer was $1 million for the
property. So then, you can see to my dismay, here's the property now maybe
going for $750,000 with the incentives, so I'm a little perplexed to say, what
happened here? So, as a matter of fact, we're ready, willing and able to go
right into a ~DA. We've done extensive due diligence, we've just got a few
little things left, we're able, we wanted to get started in the next 60-90 days
under construction and not let something drag out. The interest rates are down
right now, it's a good market, there's not a lot of new development here in
town, we think the wave is here, let's start building. So, if you have any
questions . .
Thank you, Mr. Pavelak. Mr. Chuck, I don't know if it is Werrman or
Wessman.
4
Wessman:
Mayor:
Cooper:
Mayor:
Schnetz:
Pacheco:
I'm Chuck Wessman. I'm the CPA with Mellon, Johnson & Reardon here in
San Bernardino. I'm also a resident. I live at 863 W. Ridge View Court.
Basically, I was at that August 5th meeting; it was certainly all of our
understandings when we left that Century Homes, if they performed and were
able to close the Arrow Vista 24 lots, that they would be given right of first
refusal on the Glacier's property. Since that time, they have continued to spend
money to do due diligence, and I think really, they are ready to match the offer
that is on the table and go forward with the project. So I think it is in the City's
best interest, and also I think: in good conscience, that is basically what was
represented to the company by the Committee that day. Thank you.
Thank you Mr. Wessman. Mr. Dave Cooper.
Good afternoon, Mayor and members of the RDA. I'm Dave Cooper, I'm the
project manager for Arrow Vista, I'll be the project manager if we go forward
with any future projects here in San Bernardino. One of the things that Mr.
Pavelak has consistently said at all of the hearings that we have had on Arrow
Vista and at any of the public forums, was that he was willing to take a chance
on Arrow Vista and try and help the City, but he didn't want to take a chance at
losing money--he was willing to break even, or perhaps not get all the G&A
costs that we would normally put into a development to try and make that work,
with the anticipation that if there was a shortfall, he could make it up in future
projects. And he has been very consistent in that. One of the things that you
need to be aware of, is that Mr. Pavelak personally guaranteed those loans at
Arrow Vista--it wasn't guaranteed by the corporation, it was guaranteed by him
personally--and that was in anticipation that we have the right to match any
offers that came up in the future that we could make up those shortfalls, so he
took a tremendous risk, and it's turned out to be a good one for everybody, and
we would just like to be able to continue on that vein and do a good job on the
next project, too. Thank you.
Thank you, Mr. Cooper. Is there anyone else that wishes to speak to this item?
If not, are there any comments or questions from members of the Council? Mr.
Schnetz:
Thank you. The proposal that was made by Century Homes was $300,000
down and a $300,000 note, and then up to $400,000 of a share of the profits--
that's how they came to the million dollars? And the Agency would like to do
the other one because it was less money, but it was cleaner, a quicker sale, all
cash at the front of the deal? with the 825 cash at the close of escrow?
There was various conditions placed on the Century proposal--it was contingent
upon sales. It was not a straight forward proposal where cash would be
5
Mayor:
deposited into escrow--again, it was contingent upon performance. You might
want to add a few things for clarification purposes. It is true that we had
extensive discussion at the Redevelopment Committee. In fact, on that October
5th committee, I, too, presented a chronology of events to the RDA, and at that
meeting I was very clear in my recommendation that the Glacier was not part of
the transaction on Arrow Vista. And as the Council may recall, we had, the
Agency had entered into an agreement with Century relative to Arrow Vista
over a year prior to the development coming forward, and as a result of various
impasses on the project we went back to the drawing board on Arrow Vista and
the Agency negotiated extensively and made many concessions in order to help
Arrow Vista move forward. While I realize that there wasn't a significant profit
involved for Arrow Vista and there was some risk involved to the developer, at
the same time there was also a risk involved to the Agency because we were
forgoing our purchase price as well, and there were a number of concessions
that we made. Consequently, the Agency did not get their purchase price up
front, and I think that that's the same transaction that you have in front of you
with regard to Glacier. There's a lot of contingencies placed upon the sale of
that property.
Any more questions? Ms. McCammack.
McCammack: The one paragraph of note, Maggie, in the minutes is, Council Member Estrada
made a motion, seconded by Council Member Suarez, and unanimously carried,
that if the commitment is not received from Century Crowell by the end of
today (being October 5, 2(00) the Committee would recommend a public
hearing on November 30th and an amended Disposition and Development
Agreement.
Pacheco:
Did the Century Crowell folks understand that that was the motion made and
unanimously carried at the end of that meeting?
It was very clear in terms of what I recall; that motion, and the Redevelopment
Committee members were speaking to the recommendation that the staff had
before them, and that was dealing with the Arrow Vista Project. Staff did not
want the Arrow Vista Project to be muddied up with the Glacier property. In
fact, my recommendation on October 5th was that the Redevelopment Committee
concur with staffs recommendation to terminate the DDA bind between the
Agency and Century and forward this recommendation to the Community
Development Commission, thereby, prompting the motion that is in front of you
in the minutes of October 5th. That's where we were. We were at a point
where we could not come to an agreement with Century and the Committee did,
in fact, state that if you do not have a response by the end of the day, terminate
the agreement.
6
McCarnmack: But, then in your chronology there's a letter from Century Crowell specifically
asking for a response, their letter dated October 17, I'm sorry, September 11th ,
and I guess they received no response to that letter?
Pacheco:
Mayor:
The response that they received was a verbal from, myself, my discussions were
always with Mr. Vincent, and if Mr. Vincent did not receive a written response
from me he always received a verbal response from me, and I believe that at all
times I have kept Mr. Vincent informed of the Agency's position. Prior to
going out with the RFP, I also advised Mr. Vincent that the Committee took
action to instruct us to do various things that was noted in the minutes, and then
subsequent to that, the Commission requested that we do an RFP, thereby
prompting the May 18th RFP.
Ms. McCammack.
McCammack: I remember the discussions that came back to the Commission regarding the
Arrow Vista property, and I think we were all very pleased that that project
went forward and moved forward and has moved forward as quickly as it has.
And although I understand dollars are dollars, this is a business and the cleaner
the deal the better. I'm just not sure that we don't have some kind of an
obligation to this developer for what he has already done, and the risk that he
did take, and not necessarily saying that the RDA promised him anything,
because I can't find any of that in any of this documentation. I don't know what
this body needs to do, but I sure do feel like we should be fair to any developer
that has been fair to us.
Suarez:
Mayor:
Suarez:
Mayor:
Through the chair.
Yes, Mr. Suarez.
I just want to make a couple of things clear. I've always insisted that all the
property that is up in the north end stand on their own merits--each and every
property--and have discussed that with Mr. Van Osdel, Maggie, and whatuot.
When the conversation came up with Century, and I applaud the work that they
have done in your ward, I adamantly made sure that Maggie and Mr. Van Osdel
did not include any, either the property or the Glacier property, on any
of these conversations, because each one of those was to stand on its own. Am
I correct Mr. Van Osdel? (Could not hear whether there was a response.) See,
so that then has been my stance on all the discussions that have come up. Do
not discuss those properties up in the north end because those stand on their
own.
So your understanding is that one was not contingent on the other.
7
Suarez: That is absolutely correct.
Mayor: Mr. Schnetz.
Schnetz: I just would like to ask - this is a public hearing to award it - an exclusive right
to negotiate - I think at any point, anybody can come in and say what they will
offer, and if you want to offer a better offer than GFR then this is the time we
need to hear it.
Pavelak: Well, we are here today to make that offer, but also I wanted to make a
clarification that on the offer that we did make on the Glacier's, the $1 million,
was the $300,000 down, the $300,000 note, and also the City had the first
$400,000 of profits--we didn't have any, so the first profits were going to the
City to equal that million dollars--it wasn't a share of the profits. And what
happened is, if that project only made $400,000 the City would have that and
Century Crowell wouldn't have that. We're here today to, and we appreciate
the time, and we're here ready to go into a DDA and make the offer of
$850,000 all cash for the project.
Mayor: OK - Mr. Van Osdel. Thank you Mr. Pavelak.
Van Osdel: Mayor, one of the things that's missing from the discussion and the chronology
of this is that back when the Agency entered into a Disposition and
Development Agreement for this property, it was many many months before any
of this transpired. And you may remember, that we reached the point where we
were going to hold them in default because nothing had happened pursuant to
their agreement with us. The feeling was that obviously there word was not any
good. At issue at that particular time as well was their good faith deposit, and it
was only through reluctance that the Committee and the staff went into review
and discussions with them to see if we could make some sense out of this whole
issue. And so the Committee and staff began negotiations despite the fact that
we had had a previous DDA, we tried to get something done on the Arrow Vista
Project. The reason why the Committee made the motion that they did that day,
was clearly because of their experiences that they had with this firm, trying to
reach any kind of agreement in the first . . . They did not want to run the risk
once again of jumping into a DDA with a firm that six months later, eight
months later, or twelve months later had yet to produce. They were very leery
of doing anything until there was definite It was their
request, but not acted on.
Mayor: Mr. Schnetz and then Ms. McCammack.
Schnetz: But the Arrow Vista deal is closed and it's--is it built out now--the 24 lots. And
they are all sold out.
8
Unknown:
Schnetz:
Pavelak:
Mayor:
Mumbling.
All sold out. As a matter of fact we're taking reservations for the next 38 lots.
So what I hear staff saying is part of their decision in this other direction was
their, they were not comfortable with the first set of negotiations, and the first
time they negotiated with the original DDA. Is that something that was a one-
time problem--it wouldn't happen again.
That is just a one-time problem. And when we were in negotiations, it was a
tough project--if the Council remembers, the three people that bid on it was
ourselves, Century Crowell; Inco Homes, which is now bankrupt; and then the
nonprofit organization. This new RFP went out and you have three bidders--
you have nonprofit, Century Crowell, and the other developer, GFR. We've
always looked up to my commitments, and that's why I mentioned, I had my
banker here, we've been banking with them since 1976 here, so if there was an
uneasy time with the staff, but we've been able to perform, and the timings
right, so, and I think you've always had, you know, you've had me at my word
here. I get through the projects. I don't have a situation where they are half
completed.
Thank you, Mr. Pavelak. Ms. McCammack.
McCammack: I think Mr. Van Osdel's recollection is correct. I would like to add to it my
recollection, which was, this project was going to be a very difficult project to
cancel out in the first place. There were some underlying problems with the
project in the first place. And I certainly feel we were lucky to get this project
to happen in the first place, and we're lucky to have homes built on it at this
point in time. I think the RDA at that time made their decision because they felt
like they were between a rock and a hard place and had to make a firm decision
to move the project forward or move on. I don't, I don't believe it was because
they didn't believe your word, but I'm speaking out of turn since I'm not on the
RDA. But I know when it came to this body, that's the conclusion that I came
to.
Pavelak:
Mayor:
At this point in time it seems to me, Mayor, that we've got two offers on the
table, and I don't know if that's the legal way to look at it, but it seems like we
have $850,000 cash with a $75,000 incentive, or $850,000 in cash. Would that
be the way it appears to you.
Yes, that's the way it appears.
Ms. Estrada.
9
(Note: Tape turned - may be missing words.)
Mayor: There was a clarification of the two offers that we currently. . .
Van Osdel: Normally, normally you invite offers when you go to your public hearing on
your ultimate Disposition and Development Agreement. I'm unfamiliar with the
situation where you've gone through the process, the democratic process to
select somebody, and before awarding them an exclusive right to take a peak
you take another offer. I
McCammack: Do we have the right to reject everything up to this point, or do we have some
legal and binding contract with the other developer?
10
Sabo: Well, first of all, there is no binding contract, there is nothing implied with the
other developer. What you have before you is a process that was undertaken
with a mutual committee to come up with a recommendation. As Mr. Van
Osdel said, before there can be a final binding agreement for the sale of
property, a final agreement must come back to you at a public hearing, and once
again, that process is open to the public.
Mayor:
Schnetz:
You may recall, when staff made one recommendation for a potential developer
on the INS building, at the public hearing, somebody else came forward with a
better offer and the Council decided at that time to award it to the other party.
So, the choice that you are faced with is do you take the recommendation of the
Committee to move forward, but still knowing that there is the public hearing
out there within 60--maybe 75 days--when not only the other two developers,
but anybody else can come in who wasn't a part of that process and can submit
an offer at the public hearing. That's the purpose of the public hearing because
this is not a competitive bidding process--it is a proposal process.
Thank: you for that clarification. Mr. Schnetz has a question.
According to Chuck, I don't remember Chuck's last name, Century Crowell has
been doing, you've been doing due diligence on this particular piece of property
already? Would you need to have 60 days to do exclusive right to negotiate or
could you just put together your deal right away and bring it back for public
hearing? In other words, could we save 60 days worth of time.
McCammack: That's what I'm wondering.
Mayor:
Pavelak:
Schnetz:
Mayor:
Schnetz:
Sabo:
Mr. Wessler, or Pavelak, Mr. Pavelak. You understand we're in a dilemma
here and we're trying to do the right and the fair thing.
Yes, and I appreciate that; and so are we. We would be ready to go into the
DDA there and close in 60-90 days. We've conducted quite a bit of due
diligence, we just need a couple of little verifications with the City.
So the next meeting you could actually bring back a DDA for 850 cash.
No, I don't think that's the process that was outlined.
Then we don't need an exclusive right to negotiate.
We're not going to come back with the DDA by the next meeting. What I
would say is a reasonable time period, perhaps within 60 days we would have
worked out all of the details of this, which is, every one of these is slightly
11
Pacheco:
Mayor:
Sabo:
Schnetz:
Pacheco:
Schnetz:
Pacheco:
Schnetz:
Pacheco:
Schnetz:
Pacheco:
different. There are some other issues here because of how we acquired the
property, which is different than Arrow Vista. But I don't say, at best we
would have a public hearing noticed in about 60 days. Then the issue becomes
how soon after that public hearing does the escrow c1ose--does it close within 3-
5 days, or is there another 30-60 days take off from that, which is something
that would have to be discussed. Is the due diligence being done at the same
time we're negotiating the agreement, or does it tag on afterwards, or would we
have virtually a simultaneous closing upon execution of the _ DDA.
In addition to that there are some other things that need to be taken into
consideration. There are some legal issues with regard to title, and then there's
the tentative tract map that needs to be completed. At this point in time, I can't
tell you when those items are going to be completed. Most specifically, we
need to take care of the title issues and ensuring that the title is placed in the
name of the Agency which currently is.
All that takes place prior to us taking any kind of action?
Before you take the, even the final action on the DDA, 60 days from now, a lot
of those can still be conditions at the close of escrow that we can deliver
marketable type, those items are being worked on right now but it will take
some time before they are concluded, and regardless of which party we go into
the agreement with, that work will continue and in any event be a condition at
the close of escrow. Hopefully, by the time all parties are ready to close, these
other issues are resolved. It's just a matter of mechanics and, of course, the
processing of the final tract map.
We're not processing a tract map, are we?
A tentative tract map.
They are processing a tentative tract map?
Yes, they are in the process of renewing the map.
So one of the contingencies of the escrow or even the sale would be that the map
be approved prior to the close of escrow?
Pardon?
Is one of the conditions of either one of these sales that the map be approved
prior to the close of escrow?
Yes.
12
Schnetz:
Pacheco:
Schnetz:
Pacheco:
Schnetz:
Pacheco:
Schnetz:
Pacheco:
Mayor:
Suarez:
Mayor:
Sabo:
That's going to take six months.
Well, we're hoping that we can get to Planning Commission and City Council
within 45-50 days, hopefully.
I've never gotten one approved in six months yet.
The map has been previously reviewed and we're going through the conditions
right now, and we have gone through preliminary design review and we are
scheduled to go before a formal design review in a couple of weeks.
Are we too early then?
In terms of exocivity?
If we're waiting to get the map approved, and then there's going to be
conditions of approval that everybody has to approve, that could throw the deal
sideways again, because who knows what the costs are going to be. We don't
know any conditions of approval.
We have pretty much gone through the conditions right now. We have a pretty
good sense of the preliminary approvals. Granted, there might be some items
added at Planning Commission, but it is our intent to try to get to Planning
Commission at least 30-45 days from now. At least that is what our tentative
schedule is. Before we get to Planning Commission we will certainly have the
conditions of approval. In fact, we have weeded through most of the conditions
right now.
OK, Mr. Suarez, did you have a question?
Yes, I do. I have a small dilemma in my brain because I'm not as smart as all
of you guys are, and that is, are we here to put the property up for a bidding
process today, or are we here to discuss R43, you know, so what, what affect
does approving or disapproving R43 have to do with the entire process? Or, do
we still not have a public hearing at a future date where all of this will be
resolved? Do we stop all of this process right now?
Let me see if I can clarify your dilemma, Mr. Suarez. We know we have to
have a public hearing. In order to go to the public hearing, Mr. Suarez, we
need to take some action today. The action will be to approve, is that right?
You need to give us some direction
13
Mayor:
Sabo:
Mayor:
Sabo:
Mayor:
Sabo:
Mayor:
Suarez:
Estrada:
Mayor:
So if we approve this action today, it doesn't mean it's a done deal, because it
still has to have a public hearing. However, if we don't approve of this action
today, then we don't have a public hearing, and then we go out to bid again, or
what? I think that is what Mr. Suarez wants clarified. Will you help us with
that?
If you take no action today, then it would be whenever either staff or somebody
else could to come forward with a proposal which would go back to the RDA
Committee as a single proposal to say .yes" or "no" on . . . There might be
another formal process, I don't know.
OK, and that formal process will take about how long?
It's going to take a minimum of 45-60 days by the time you get the notice out,
reviews, have an interview panel, make some evaluations, it's a 45-60 day
process.
So if we proceed, and these are all hypothetical, to give us a sense of direction,
and I know that all of us have concerns and we want to do the right and fair
thing for certainly all parties, and have acted in good faith, I believe, if we take
action today based on staffs recommendation, then we would still have a public
hearing and at that time both parties proceed with their best argument at that
public hearing, and at that public hearing we may change our minds and, not
change our minds, but we will decide who the successful bidder will be.
Both parties and anybody else that...
And anybody else, I understand. Is that clear.
That is absolutely clear, Mayor. Let me, allow me to make a motion to adopt
staffs recommendation and that said resolution be adopted.
Second that.
OK. Ms. McCammack.
McCammack: At what point during the negotiation process would then, this DDA and
exclusive right to negotiate that this resolution that is attached to this backup
would no longer be valid, even at the public hearing? What would they have to
do, now that they, I mean, this developer knows what that developer is offering,
now. Correct?
Sabo: Yes, that is correct.
14
McCammack: OK. So, in their exclusive right to negotiate, what is it that they would do that
would cause this agreement to fail, so that at the public hearing somebody else
could actually corne in and make a different offer that we could then be legally
able to accept?
Sabo:
Mayor:
Even with this exclusive right to negotiate in place, you cannot preclude
someone from corning in at the public hearing and making another offer. In
other words, if this agreement is going to limit you to accept another offer, then
it's unenforceable because you cannot make such a commitment to sell property
without a public hearing. The agreement will not preclude you in any way from
making another decision at the public hearing.
What are the implications for the DDA? I think that was your concern. It
seems like I'm reading minds today. What are the implications on the DDA.
McCammack: The legalities.
Sabo:
Mayor:
Sabo:
Mayor:
Schnetz:
On the DDA, first of all, it will become a public document two weeks before
that public hearing. When we publish the notice of the public hearing, on the
date of the first publication there is a summary of the agreement, plus the
agreement itself, in substantially final form, must be available for public
inspection. So, the entire world has access to the agreement at that time. So,
any other developer, any other party who is interested has access to those
documents and has the right to corne in when this is published at the agenda and
get the final copy of it and corne in and submit to you a showing time
periods, submit to you more lenient provisions of the Agency, a higher purchase
price, whatever they may want to submit at that time.
And also at that time the members of this Commission could also do a
qualitative analysis based on the history of the different developers that we have
had. That would also...
Whatever the process that you would want at that time. That's the reason for
the public hearing. If you've already pre-deterrnined who is going to be the
purchaser of this property, then you are making a commitment without the
benefit of complying with the redevelopment law regarding a public hearing,
which you cannot do.
Mr. Schnetz, you had a question?
If we are going to be doing the map, and as owner of the property, and any
project, or any DDA that we enter into at a future public hearing, the closure of
escrow is going to be contingent upon the developer's approval of the conditions
of approval of that tentative map as approved by the City Planning Commission,
15
Pacheco:
Mayor:
Pavelak:
Pacheco:
Mayor:
it's really not a firm deal, price wise at least, until that occurrence. Because
usually what happens, if there's something that comes up that in the approval
process, a condition comes up that, you know, some storm drain needs to be put
in, or retention basin needs to be put in, they are going to recrunch all the
numbers anyway and come back and say, we can't pay this much money, we've
got to pay less money because of this new condition. So, I really think it's kind
of a waste of time if we're going to, if we're going to be putting the map on
there, to do a public hearing before the map is completed anyway, the tentative
map is approved.
The likelihood of that occurring is probably pretty slim. We are on a fast track
for approval of the tentative tract map, because I do agree that the map must be
at least considered by the Planning Commission so that we know what we're
dealing with. After your action today, we had anticipated meeting with the
developer and sitting down and going over the conditions of approval that are
currently placed on the map right now, because we are re-visiting an old map.
There are a number of conditions that may no longer apply. But we pretty
much have a good sense of that, as I indicated earlier, by the preliminary
feedback that we've gotten from Design Review. So those discussions are going
to immediately commence regarding conditions so that the developer knows
what kind of conditions are going to be placed on the project, thereby affecting
the economics of this particular transaction.
OK, Mr. Pavelak.
Yes, if I could say one more thing. In your chronology I wanted to clarify
something. On the comparison there, that stated that Century was only going to
do houses from 1500 to 2300 feet--that was not true--we know the City is
looking for some higher income housing--we are doing 1500 to 3000 square feet
on those lots there, so I wanted to clarify that. Also, the reason I came here
today, behind me I have the whole, the DRC submittal elevations and floor
plans, and that generally takes about 60 days. That's why we want to be able to
get it in the City to know that we can build that product. Because we don't
know, and that's the process that you take, but we were going to ask that if you
could go concurrently, and as Maggie said, on the fast track and get it
approved, so that way you are underway, in no more than 90 days you are
grading and building homes, and you've got delivery, say around Christmas
time is what we are anticipating there, so you have people moving in by
Christmas and then changing their schools or whatever by January 1".
Mayor and members of the Council.
Yes, thank: you Mr. Pavelak. Ms. Pacheco.
16
Pacheco:
Mayor:
Unknown:
Mayor:
I didn't want to belabor the issue, but a couple of components that we looked at
as a committee was that the Century proposal was, in fact, conditioned upon
approval of an assessment district. The other condition that was submitted in
the proposal had to do with proceeding with Phase II of Arrow Vista, making
the Arrow Vista Phase II also a contingent opportunity. So at this point in time,
although they have expressed a desire to move forward with Phase II, we do not
have a deal. So, again, we felt we did not want to include Arrow Vista in this
transaction, nor did we feel at staff that discussing an assessment district was an
item that we wanted to bring before you. So, the proposal had a number of
things that we took into consideration as part of the evaluation process.
OK. Ms. McCammack and then Mr. Vincent. No, you're not Mr. Vincent.
Thank you, Mayor, if I could just speak briefly. As originally submitted, the
RFP did say that we expected that the Agency would take the monies from the
Glacier sale, put that into a subsidy on the 38 lots becanse there needs to be one
in order to equalize the economics between the 38 and the 24 that we are now
building. But in subsequent discussions with staff, we backed off of that
becanse Ms. Pacheco was quite honest in saying, "well, we need the cash from
Glaciers to deal with the bond that we put on in order to purchase that
property," and so I've been trying to work out with her an agreement whereby
we could go in on the 38 and not ask for that cash subsidy. So there has been
some evolution of that deal point.
The assessment district, that would be something that we can determine during
feasibility, or make a determination that we wouldn't have one. So, I just
wanted to make that point. Thank you.
Ms. McCammack.
McCammack: Thank you, Mayor. I just, I don't see anything in the backup from GFR to
kuow whether or not there was any discussion of an assessment district, and
would you even know that until you went through the whole DDA?
Pacheco:
Perhaps not, particularly not knowing the conditions of approval. GFR was not
proposing an assessment district. It has been my experience that Century pretty
much looks to an assessment district for financing for purposes of an
infrastructure.
McCammack: But we don't know for a fact that GFR wouldn't have brought that up in the
DDA?
Pacheco:
No, we don't know. We know that it was not reflected in the proposal.
17
McCammack: Would it have had to been?
Pacheco:
Mayor:
Estrada:
Mayor:
Estrada:
Typically, in our RFP we ask the development entity to identify what financing
scenarios they are going to utilize, and that was not referenced.
Any more questions. We have a motion before us. We have a second. I will
call for the question. It looks like the motion fails.
Can we still have discussion?
Can we still have discussion after a motion fails? I guess the question would be,
"what happens next?" Ms. Estrada.
Can we discuss it? I guess the point I was going to make is, sitting on the
committee, I, too, don't recall, and I don't know what Mrs. Anderson recalls,
but I would certainly be interested in finding out, what you recall as to the
exclusive right as has been discussed here today with a, on this deal. And I
guess my point is, that uuless you have a point for point comparison of what the
two proposals are, it's a little hard to go to anyone. And, what I don't
understand is not going forward with what has been presented to us now, after
all that has been said about the public hearing. At the public hearing, then the
interested parties here can come in and make their own presentation, and who
knows, you could still award it to that particular company. We don't know that.
I think by not taking any action today, all we are doing is delaying this process,
and I don't know for how long. And I don't know whether, because I'm not in
a position to be able to evaluate point for point, and neither is anybody else
around this dais, at this time, I can't say that it's a waste of our time, or
anything like that, but I do think that if we're going to try and protect the City
to the degree that we can, and the Agency, that we need to move forward with
this, with the understanding and Century knowing, of course, that they can
always come in at the hearing and present their offer. So, I don't know what
kind of jeopardy it puts Century in, or even, we know right now what the offer
is from GFR, so we know more about GFR than we do about Century, even
though we still don't have all the answers for a lot of questions, including the
plan and so on.
But, it seems like if we don't act now, you're just setting this thing, you now,
way back. So, I'm not sure what happens if between now and when we have a
public hearing, if it is going to be 60-90 days down the pike, market, if there's a
slump or whatever, what does that do, do we hang on to these properties
because these gentlemen have a perfect opportunity to back off and say, "hey,
we're not going to go into this now" and so we're still stuck with where we are
18
at now. So, I don't know, I can't understand the rationale, maybe Ms.
McCarnmack you can explain it.
McCarnmack: Before Mr. Suarez made the motion, my rationale was going to be, and I should
have jumped in and said, "Is there a reason, and what would the reason be, that
we couldn't schedule the public hearing without a DDA--do you have to have a
DDA with a developer to schedule a public hearing?"
Sabo: You have to have the DDA there, you have to have the terms, and the only
disadvantage that you have is, unless you really get some direction from the
public body to negotiate with one developer, whether it's under an exclusive or
just begin the direction with this developer, will the developee, will
the developers be willing to save the time and effort to assist in those
negotiations, so by the time you do get to a public hearing, there is a document
that both parties have thought through and it's a document that you know can
work. To just have an agreement in a vacuum, I guess it could be done, it's
probably less than desirable, but you could have the document there, but it
would be very unusual. I have not seen that be done where the public hearing is
used as a bidding process.
McCarnmack: Is there any way to enter into negotiations with both developers, since those
seem to be the only two developers up to this point that have expressed an
interest?
Sabo: That could certainly be done. I don't know that both parties, or either party
would be interested, but that could certainly be another option. I have seen that
occur in some instances, where you go down parallel tracks with two
developers, and whichever one is the easiest to work with, whichever one gets
to the public hearing process first, is the one that you go with, or the other one
still has an opportunity to match that deal. But it does compound the staff work
as well, to be negotiating simultaneously with two developers, but it is possible
as well.
McCammack: I agree with Ms. Estrada, we need to move forward with the process, and when
Mr. Schnetz said, how do we save that 60 days, you know, I'm not sure how
we can legally save those 60 days, but I just, in the back of my mind I feel like
we have some obligation to this developer, and that's not the developer sitting
on the DDA in front of us. So if there is any way to get both developers to the
table, I don't know how we do that--I don't know the legalities of it.
Mayor:
We're struggling because we're, we really want to do the fair and right thing,
which is why, I believe, the recommendation was that we proceed with this and
then we do this additional negotiations that Ms. McCarnmack was talking about.
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Estrada: Mayor, I guess if I would recall, that, in fact, when we did the deal with
Century, we were advised that they were going to be going, committing
themselves to X, Y, and Z because they were looking at this other deal down
the pike and they were going to commit themselves to a lot of these financial
commitments. I think we would have said at that point, you know--hang on a
minute, I don't know that you would want to do that--and that would have had
to have been in writing somehow, so that we said,--yes, absolutely, we have
committed ourselves to this, here it is on the record here, here it is in the
minutes, here it is in the document, and that's what we committed ourselves to.
I don't recall it that way, so it makes me, if you really want to put the, where do
we put the I mean in terms of feeling guilty about not being fair? It
seems to me that sitting on that committee, we've been dealing fair--we've been
saying, "OK, we heard this proposal, we got that other proposal, we have staff
do X, Y, and Z, and that is what has brought us to this point. At this point in
time, I'm ready to vote on this matter, but, if we know that there is still an
opportunity for Century to come back at the hearing and make their proposal, I
can't understand what is not fair about that. I would look at both of them, and
if it's a better deal for the City, you bet I'm going to support the better deal for
the City. So I don't know what the hang-up is.
Suarez: Well see, that was my logic behind making that motion, was that here's a deal,
concrete, we can act on it. The other ones are going to come. And then at that
time we make the choice. Because if we start bidding here, bidding war right
now, we may end up with nothing, we may end up with the property back, and
what will we have--business as usual. So this is what I'm getting at.
Mayor: Let me a . . .
Suarez: But that's OK. If this is what this body wants, business as usual, then, like in
the old days, let's go for it. Because if I remember correctly, that's how
business used to be done.
Mayor: We need to know, we the Mayor and members of the Commission, since this
motion did fail, and we certainly want the development of these properties,
what's the next step, what must we do now? Somebody? Mr. Van Osdel.
Van Osdel: Although I'm not sure I agree with my own idea, because quite frankly I think,
you know I sense somehow there's a suggestion here that staff has not done
their job somehow, and we've not been fair, and that's totally contrary to my
belief. I think Ms. Pacheco has done an excellent job in meeting with this
group. Nevertheless, if you're at an impasse here, why not solicit proposals
from each of the two and the highest and best wins.
Mayor: That's the point that Ms. McCammack was making, knowing. . .
20
Van Osdel: Sealed, secret.
Mayor: Sealed bids.
Van Osdel: Contingencies listed and highest best.
Pavelak?: Can I ask this then. What we all need is for the ground rules then, is it an all
cash, that's what we're looking at, so let's make it clear so it isn't because you
know, if you change, and you have terms and so forth, it affects it differently.
So what we need to do is know from you and the Council, is it the highest and
best all quick, all cash-quick close, or is it a terms deal.
Unknown: No.
Pavelak?: And then, what other subsidies from the City and so forth there. That's all we
needed, that's why we felt that the City couldn't get hurt with the first right of
refusal. As a matter of fact, I'm up here today beating his offer, you see. And
if he's in the audience, I guess he could say, he could stand up here and say, I
offer 900. I don't know if he is here or not. .
Mayor: Let me, let me suggest this. I don't feel that we are in a position to negotiate all
this publicly. I think you said it, Ms. Estrada said it, Mrs. McCanunack said it,
whatever works best for the City. The recommendation that Mr. Van Osdel
made, I think was a fair one. Now that you have heard that we really want the
best for the City and we also want to do the right thing by our developers, that
you provide us with an offer in a sealed envelope.
Van Osdel: And we will advise both parties of the conditions.
Mayor: And you will advise both parties of the conditions and the sense of the members
of the Commission. It will then go to the RDA. The RDA will make a
recommendation to us, which is why we have the RDA Committee, isn't that
right. Of course, this was the recommendation of the RDA.
Suarez: Comment with some laughing (unable to decipher).
Mayor: OK. Let's think this out to make sure that we all understand the rules. Are the
members of the Council comfortable with the recommendation that was made by
Mr. Van Osdel?
Estrada: Ouly one thing, Mayor. I would very much recommend that given that we're
going to be taking some more time here, that we get some kind of sense, some
21
kind of timeline from the staff as to how long this is going to take. Because
then it's got to come back through the process before it comes back to here.
Mayor: OK, good point. We would like to have this done in two weeks--how's that?
Van Osdel: We would hope to get it out and have some response within two weeks.
Mayor: So that we, it could be brought back to this Council at the next meeting.
Unknown: Can I interrupt here? I think I have a right to speak:.
Mayor: Certainly you do. Your name, sir.
Arrera: My name is Richard Arrera.
Mayor: Richard Arrera.
Arrera: Right. I'm with GFR Enterprises.
Mayor: Oh, oh, we were wondering if anyone was here.
Arrera: this has turned out to be. I'm here with my partner, Felix Robles,
who stands behind me here.
Mayor: OK, Mr. Arrera; and your address, Mr. Arrera.
Arrera: 549 Westminster Court, City of San Dimas. I'm not exactly sure of the process
that's going on here. I'm at a little bit of a loss. We thought we were coming
here to vote on an exclusive right to negotiate--what we were going to watch.
What I believe the process was, is that everybody had a right to put their cards
on the table months ago, or weeks ago, or whenever it was. We did, somebody
else did, so did Century. We all looked at the project, we all decided it was a
project we'd like to go on, we decided we would, and everybody got a right,
one time, put your cards on the table, this is what you are going to bid, and
whoever was chosen by the Committee was chosen, which was us, GFR.
So now it seems to me, correct me if I'm wrong, that that doesn't work. You
can come in here and say, "well, we know what you bid, we know what they're
going to bid, do let's just do a bidding war again," which doesn't seem right to
me. Everybody did it already. So we didn't have three bidders, now we've got
a fourth bidder--Century is going to come in and bid again, after they know
what we have already bid, and we know what they've bid, but our bids were
taken. And I keep hearing that you want to be fair, but that doesn't seem fair at
all. How can that be fair?
22
Mayor:
Arrera:
Mayor:
Arrera:
Mayor:
Arrera:
Mayor:
Arrera:
Mayor:
Arrera:
Mr. Arrera, I can assure you that in most cases, I would say in 90 percent of the
cases, maybe even higher than that, the bidding process that is used does work.
In this case, it didn't. Again. .
Is there not a procedure that you, that everybody followed? You have the
minutes, you have. . .
Yes, yes
You have what everybody has said and what everybody has done, and it's public
record. We all followed the procedure, so how can it not be correct?
It was correct, and you followed the procedure as indicated.
And we were chosen.
And you were recommended, but the fina1 decision is made by this body; and I
think you saw how the votes were cast. The process . . .
I think under confusion, but, because I don't think really everybody understands
what's going on.
No, I'm sure everyone understands what our bidding process is. We followed it
as we do with all the others, and it's a recommendation that comes to this body.
A recommendation does not mean a done-deal necessarily. And then the
members of this body consider all the factors involved and all the presentations,
as we have today, and some of the presentations that were made. And then the
vote is taken, and you saw what the vote was. Now, we had a choice, we could
have just gone out to bid again, which has happened in other bodies that I sit on.
All bids are rejected and then you go out again. We do that. In this case, we
are, instead of going out to bid again, which would prolong the process, we
want to shorten the process. You know what the offer is on the table. They
know what your offer is on the table. We want your best offer knowing what's
on the table and Century's best offer, knowing what is on the table, and we will
make a final determination in two weeks. We apologize for it not running as
smoothly as one would always like things to run, but in the political process
sometimes glitches happen. I'm not saying this was necessarily a glitch, but the
fInal decision is this body's, and it was a recommendation, and the
recommendation was rejected. Fortunately for some; unfortunately for others.
So Mr. Arrera, I apologize at any inconvenience that this may have caused you;
however, this is the political process.
Well, I thank you for your time, . . .
23
Mayor:
Arrera:
Mayor:
Arrera:
Mayor:
Robles:
Mayor:
Schnetz:
You're welcome.
but I just wanted to come up here to say, to clarify what we feel, where we
stand. I don't know if my partner wants to say anything. . .
Thank you, Mr. Arrera, we . . .
I think he does, so, thank you.
Thank you. Yes, sir.
My name is Felix Robles, and I'm also a principal of GFR, and I concur with
Richard. I'm a little confused at this process that has taken place here. I am
not so sure, you know, we're going to go into a sealed bid here, when the truth
of the matter is, neither one of us know the conditions of the approval. And
anything can happen at that point. Century, with all due respect, can come up
with a higher bid, as well as ourselves, and then everything is going to change
at that point again if the conditions are not what either one of us approved. So,
the process that we're now entering into just doesn't seem right, it doesn't seem
fair--really for either one of us, but, we went through the proper channels of
bidding on this project and, again, you do have the right to make a choice, I
understand that.
I assure you that we share your frustration; we understand. And the point that
Mr. Schnetz has made is that it is, well, I'll let him
If we have a sealed bid, I think, to make sure the number is a real number, we
should have the conditions of approval of the tract map and we should have a
title report.
McCammack: I agree.
Schnetz:
Pacheco:
Schnetz:
Pacheco:
How quick can we get title transferred?
In light of the calendar for the processing of the tentative tract map, two weeks
will not be sufficient.
I understand that.
I would recommend that you reject all of the proposals, and second, that you
allow us to keep moving forward with the design review process, get on the
calendar for Planning Commission, which I believe that's tentatively about 30
days from today, and once, it will be certainly be two weeks before we get on
24
Planning Commission, and we will have the conditions of approval. At that
time, if you wish, we will then transmit the conditions of approval to the
developer and have them submit a proposal to us based on the conditions that
are proposed.
Mayor:
OK, that seems fair.
Schnetz:
What about the title report? Do you have a title report that would have
everything on it except for . . .
Pacheco: We have a preliminary title report and we do, as I indicated earlier, we do have
some problems. And, 00, we will not have, in my estimation we will not have
title in 30 days--conceivably 60 days. But certainly the conditions of approval
will be adequate to the point where the developers are able to submit a
reasonable proposal.
Schnetz: Are there title problems, just basically it's still in the City's name and not the
RDA's name, or is there some other encumbrances and things that have. . .
Pacheco: That is one of the matters, and it is a technicality with regard to when the City
acquired title for the property - there was some parties that were involved in the
vesting, and we have to go through the process of obtaining quit-claim deeds
from the prior owners that hold vesting. So there are some real technical issues
that need to be resolved on the vesting, right now.
Mayor: So the recommendation, well we have now two recommendations, one was a
sealed bid . . .
Van Osdel: I withdraw mine, I like Maggie's better. . .
Mayor: Oh, you withdraw your recommendation, that you had made
Schnetz: Just finish out the tract map and get all that stuff done and then we'll know what
we're dealing with.
Van Osdel: Let me add this. . .
Mayor: Yes, Mr. Van Osdel.
Van Osdel: Since Ms. Pacheco will be going on vacation and because the Agency does not
have any housing staff, Maggie is it, our timing on this thing will be based on
when she returns, where, if I could get a housing person to go to work at the
Agency. . .
25
McCammack: I thought that was you.
Mayor: We have two recommendations. One, you already know what the first one was.
The second one was that we reject all bids, well actually, we've already taken
action--we denied it, right? So now what we need is a another motion that
would say, we've already rejected this one, that we go out to bid again. Is that
it?
Schnetz: I think: we should wait until the tract map is done.
Mayor: OK, are we in a hurry to get this done, Mr. Van Osdel? (A few words spoken
which could not be understood). Not anymore.
Pacheco: The ouly time constraints we have is that the clock is ticking with regard to the
Agency's ownership of the property. By state law, we are not supposed to hold
property beyond five years. I think we are in our second year, so I think: we're
fine in terms oftiming.
Mayor: Alright, so we are fme in terms of timing?
Pacheco: In terms of timing, in terms of state law and terms of holding. . . (tape
changed)
Mayor: Until . . .
Schnetz: the tract map is finished . . .
Mayor: the tract map is finished. . .
Schnetz: and the tentative map is approved.
Anderson: The what map is approved?
Schnetz: The tentative, it's the tentative tract map.
Mayor: the tentative map is finished; and Ms. Pacheco, did you want to say something?
Pacheco: No, I was just going to add that we can begin commencing those discussions,
not necessarily complete it, but I can understand what Mr. Schnetz is saying, so
if we project that the map, the tentative tract map approval will be done in the
next 30-45 days, we'll return to you back then.
Mayor: OK
26
Pacheco:
Mayor:
Sabo:
Mayor:
Sabo:
Mayor:
Clark:
Mayor:
Schnetz:
Anderson:
Mayor:
Estrada:
Mayor:
Estrada:
Actually, we'll go back to RDA with the recommendation.
Alright. Do I need a motion to that effect, Mr. Sabo? That's just kind of a
consensus, based on the action that we took with the last resolution.
Well, the last action was to vote for the award for the staff report. I think what
should be done is a substitute motion to make some clear direction as to what
the criteria will be when it's to be brought back.
You said clear direction as to the criteria - I don't think we've decided what that
would be.
I think when the tract map is concluded.
Ms. Clark.
Mayor, as I understand Maggie Pacheco, her recommendation was that staff be
authorized to proceed with the tentative tract map approval, then once that's
done in 30-45 days, then that the Agency go back to the Committee for their
recommendation, which will ultimately come forth to the Council. Is that
correct?
Thank you. That's correct. I will entertain a motion to that effect.
So moved.
Second.
A motion, a second . . .
Mayor, . .
Yes, Ms. Estrada.
Many times, and I understand the process and I understand what we are trying
to do here in terms of being fair, etc., but many times we do things that end up,
what we are trying to do is positively, ends up negatively, in that when you talk
to developers or when you talk to business people about coming and doing
business with us, and you ask . . . or they tell you why they won't come; a lot
of times it has to do with what happens right up here, even though we're trying
to do the right thing, but I think we need to also, always consider the flip side of
that. I know it's a done deal here for now, but we really need to be very
cognizant of that, because you can't have business people or developers say, you
know, I've heard it said before and I think all of you have too--for this reason
27
and that reason and the next reason we don't come and do business in the city.
So I think, you know, I'm trying to stay, however if that is at all possible, I
weigh out what I do on this Council, but that is something to consider.
Mayor:
Good point, Ms. Estrada. I would. . . Yes, Ms. McCammack, and then I'll call
for the question.
McCammack: Thanks, Mayor. I haven't had the history on this Council that Ms. Estrada has,
and I do take what she says with a lot of respect and I weighf it heavily; but
when something like this comes in front of us and I hear some of the
background that one developer has offered $1 million, although terms may have
been different, and one offers $875,000, I feel like I have a responsibility to the
taxpayer to make sure that we are getting the best bang for our buck. It wasn't
that we were trying to be unfair to one developer or fair to another; but I do
recollect some of the conversations that Century Crowell had with this Council
back in August and September and October of last year. And some of the
statements that Mr. Pavelak made are very similar to statements that he is
making today about the Arrow Vista property, and those are the recollections
that I am having that led me to make the decision that I made today. And it's
not to be unfair to one developer, but to make sure that we're doing the right
thing by the taxpayer--that was my motivation.
Mayor:
I will now call for the question. Mr. Arrera and Mr. Robles, thank you very
much. I apologize for any inconvenience this may have caused, but thank you.
28