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HomeMy WebLinkAbout2017-013 1 RESOLUTION NO. 2017-13 2 RESOLUTION OF THE MAYOR AND CITY COUNCIL OF THE CITY OF SAN 3 BERNARDINO APPROVING A PARKING AGREEMENT BETWEEN THE CITY AND 320 N. E STREET, LLC FOR USE OF 125 UNRESERVED PARKING STALLS 4 IN THE CITY HALL PARKING STRUCTURE 5 6 WHEREAS, Enterprise Technology Alliance, Inc. (ETA) is wishing to relocate to the 7 City of San Bernardino; and 8 WHEREAS, Alan Stanly is founder and President of ETA and the sole shareholder of 9 320 N. E Street, LLC, which is currently in escrow to purchase the Andreson Building located 10 11 at 320 N. "E" Street; and 12 WHEREAS, Through the purchase of the Andreson Building, ETA and 320 N. E 13 Street, LLC have plans to refurbish the historic structure and make the building a Class A 14 professional office building; and 15 WHEREAS, ETA is a start-up technology firm currently doing business in the Inland 16 17 Empire and is focused on the logistics industry; and 18 WHEREAS, ETA is a good fit for the City based upon our strong performance in the 19 logistics sector and the high wages of technology firms; and 20 WHEREAS, the City Hall parking structure is underutilized and has excess parking 21 capacity currently and into the future. 22 23 NOW THEREFORE, BE IT RESOLVED BY THE MAYOR AND CITY COUNCIL OF 24 THE CITY OF SAN BERNARDINO AS FOLLOWS: 25 SECTION 1. The Mayor and City Council hereby approve the Parking Lease 26 27 Agreement with 320 N. E Street, LLC, and authorize and direct the City Manager to take such 28 1 1 steps necessary to execute the Agreement, including but not limited to the making of clerical 2 or non-substantive revisions to the Agreement as may be necessary to effectuate its intent. 3 SECTION 2. In order to comply with Government Code Section 53083, the Mayor 4 and City Council finds that ETA located at 320 N. E Street, San Bernardino, California, 92418 5 will benefit from the five years of free parking that commences on the effective date of the 6 7 Parking Agreement and ending five years thereafter. The subsidy is in the form of free 8 parking representing an opportunity cost to the City, which based upon 1999 lease rates, is a 9 maximum of $38,000 annually. However, the actual opportunity cost is hard to quantify 10 because there are no parking charges in downtown and the City cannot determine if a business 11 would be willing to pay for parking. The benefits of having 20-40 full-time employees 12 13 working for a technology company focused on the logistics industry is a natural fit for the 14 City of San Bernardino. While the City will realize no new tax revenue from this subsidy, 15 having a technology company in a renovated historic structure in the City is a benefit that will 16 help start the revitalization of the downtown core. These benefits override the opportunity cost 17 of potentially renting the parking spaces for the next five years. 18 SECTION 3. Approval of the Parking Lease Agreement is not considered a project 19 20 under the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines 21 Section 15378(a). 22 SECTION 4. If any section, subsection, subdivision, sentence, or clause or phrase in 23 this Resolution or any part thereof is for any reason held to be unconstitutional, invalid or 24 ineffective by any court of competent jurisdiction, such decision shall not affect the validity or 25 26 effectiveness of the remaining portions of this Resolution or any part thereof. The Mayor and 27 Common Council hereby declares that it would have adopted each section irrespective of the 28 2 1 fact that any one or more subsections, subdivisions, sentences, clauses, or phrases be declared 2 unconstitutional, invalid, or ineffective. 3 4 5 6 8 9 10 11 12 13 14 15 /// 16 17 18 /// 19 20 21 /// 22 23 24 25 26 27 /// 28 3 1 RESOLUTION OF THE MAYOR AND CITY COUNCIL OF THE CITY OF SAN BERNARDINO APPROVING A PARKING AGREEMENT BETWEEN THE CITY 2 AND 320 N. E STREET, LLC FOR USE OF 125 UNRESERVED PARKING STALLS IN THE CITY HALL PARKING STRUCTURE 3 4 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor 5 6 and City Council of the City of San Bernardino at a joint regular meeting thereof, held on the 7 23rd day of January, 2017, by the following vote, to wit: 8 Council Members: AYES NAYS ABSTAIN ABSENT 9 MARQUEZ X 10 11 BARRIOS X 12 VALDIVIA X 13 SHORETT X 14 NICKEL X 15 RICHARD X 16 17 MULVIHILL X 18 � 19 Georgeann tanna, CM ,City Clerk 20 21 The foregoing Resolution is hereby a pp roved this �yY of January, 2017. 22 23 24 R. Carey Da�ernardino's, Mayor City of San 25 Approved as to form: 26 Gary D. Saenz, City Attorney 27 28 4 2017-13 PARKING LICENSE AGREEMENT (ANDRESON BUILDING) This Parking License Agreement ("Agreement") is made on January 73 , 2017 ("Effective Date"),by and between the City of San Bernardino ("City") and 32o N. E Street, LLC ("Licensee"). The parties to this Agreement are collectively referred to herein as the "Parties" and individually as a"Party." This Agreement is made with respect to the facts set forth in the Recitals below: — RECITALS — A. The City owns a three-level parking structure located at property in the City known as the Carousel Mall ("Mall Structure") and a five-level parking structure located to the south of City Hall ("City Hall Structure"). B. Licensee owns or is in escrow to acquire a 62,411 square foot commercial office building located at 32o North "E" Street in the City, referred to as the Andreson Building. The Andreson Building has no or virtually no on-site parking. However, the Andreson Building is adjacent to the Mall Structure and within walking distance of the City Hall Structure. C. Licensee wishes to secure parking for occupants and invitees of the Andreson Building within the Mall Structure to the extent available, and to the extent not available, within the City Hall Structure. D. The City's Development Code ("Code") requires that new and expanded land uses in the land use zone and transit overlay district in which the Andreson Building is located provide one on-site parking space for every 500 square feet of floor area. Code Section 19.62.030 provides that a nonconforming use which lawfully existed prior to the effective date of the Code,but which is no longer permitted in the zone in which it is located, may continue subject to certain requirements. These requirements include that additional development of the property shall require that new uses conform to the Code, and that a nonconforming once converted to a conforming use may not be resumed. As a legal nonconforming use, the Andreson Building may continue to operate without providing on- 1 2017-13 site parking as would otherwise be required, subject to the Code requirements for a legal nonconforming use. —AGREEMENT- 1. License of Parking Spaces. Commencing on the Effective Date of this Agreement, Licensee shall be licensed on a non-exclusive basis to use the number of undesignated, non-reserved parking spaces specified in Section 2(c) in the Mall Structure and, to the extent that number of spaces are or may become unavailable at the Mall Structure, a sufficient number of such spaces at the City Hall Structure to provide Licensee with a total of the number of spaces specified in said Section. The spaces provided may be at one structure, or the other, or divided among the two. The terms "non-exclusive," "undesignated," and"non-reserved" mean that the City will not, while this Agreement is in effect, assign to or reserve for third parties, on an exclusive basis, a number of spaces at the two structures that would result in fewer than the number of spaces specified in Section 2(c) remaining unassigned among the two structures,but do not mean that the City warrants or guarantees that said number of spaces will remain free of vehicles and available to occupants and business invitees of the Andreson Building at any given time. Licensee acknowledges and understands that the undesignated, non-reserved spaces at the Mall Structure and City Hall Structure are currently and may continue to be open for use by the general public, and that demand for those spaces may exceed the number of spaces available at any given time. 2. Term of Agreement and Number of Spaces. (a) The initial term of this Agreement shall be five years following the Effective Date of this Agreement ("Initial Term"). (b) After the Initial Term, Licensee may, with the consent of the City, opt to extend the term of this Agreement for up to four additional five-year periods, for a total maximum term of 25 years counting the Initial Term and all optional extensions. Licensee shall notify the City in writing of Licensee's exercise of each option to extend not later than 18o days before the expiration of the then current term of this Agreement. (c) At the time of the exercise by Licensee of the first of its options to extend under Section 2 (b), Licensee shall specify the number of spaces it wishes to be licensed to use for the twelve (12) months beginning with the first day of the extended term, up to a maximum of 125. Licensee shall follow the same procedure at the end of said twelve 2 2017-13 (12) months period, and at the end of each ensuing twelve (12) months for the term of this Agreement. At the time Licensee makes such specification of the number of spaces requested,the Parties shall agree upon the amount to be paid by Licensee for the use of the spaces, as set forth in Section 3(b). (d) The City's consent to extension and its agreement to license to Licensee the number of spaces requested by Licensee shall not be unreasonably withheld, but may be withheld if the City determines the number of spaces requested will not be available during the period for which the spaces are requested. 3. Payment. (a) For the Initial Term, Licensee shall be licensed to use 125 spaces, on the terms set forth in Section 1, at no cost. The City's agreement to this provision is in consideration of the current occupancy level of the Andreson Building, Licensee's intent to relocate the business operations of itself and/or its affiliate(s) to downtown San Bernardino, and the anticipated economic benefit to the City and its residents of such relocation. Licensee therefore agrees that the City shall have no obligation to extend the no-cost parking provision of this Section 3(a) to any transferee of the Andreson Building, and that any such transferee who wishes to be licensed to use parking spaces in the Mall Structure or City Hall Structure will be required to comply with Section 3(b) of this Agreement, beginning immediately upon the transfer of title. Licensee further agrees to advise any such transferee of the provisions of this Section 3(a) in advance of such transfer. (b) Following the Initial Term, Licensee shall pay the City a monthly fee for the use of the number of parking spaces which it is licensed to use under this Agreement. The monthly fee shall be agreed upon by the Parties at the time of the exercise by Licensee of the first of its options to extend under Section 2 (b) and every twelve (12) months thereafter for the term of this Agreement. The fee shall be negotiated in good faith so as to be substantially equivalent to the prevailing market rate,based upon a parking study performed by the City. At the end of the initial 12 months following the Initial Term, and every 12 months thereafter, the monthly fee shall be adjusted by the percentage increase or decrease in the Consumer Price Index for Los Angeles-Riverside-Orange Counties, CA during the preceding 12 months, as published by the U. S. Department of Labor, Bureau of Labor Statistics. 3 2017-13 (c) Payment shall be remitted on the first business day of each month to the City at the address set forth later in this Agreement or at such other address as may later be designated by the City. (d) Where payment is required under this Agreement, Licensee shall pay for the number of spaces it is licensed to use each year,whether or not Licensee actually needs or uses that number of spaces. 4. Licensee's Right of Assignment. Licensee may assign to occupants of the Andreson Building and their business invitees the right to use any of the parking spaces licensed to Licensee under this Agreement. With the consent of the City,which shall not be unreasonably withheld, Licensee may assign any or all of its rights under this Agreement to a purchaser of the Andreson Building, except the right to be licensed to use spaces at no cost during the Initial Term, as stated in Section 3(a). All persons using parking spaces licensed to Licensee under this agreement must agree in writing to comply with all terms of this Agreement and with all applicable rules, regulations, City of San Bernardino Municipal Code provisions, and other provisions of law governing the use of the spaces. 5. Limitation on Duration of Parking. Licensee shall not allow any parking space licensed to Licensee under this agreement to be used by the same vehicle for more than 72 consecutive hours. 6. Nonexclusive Right. Licensee's right to use parking spaces in the Mall Structure and City Hall Structure shall be on a non-exclusive basis. Nothing in this Agreement precludes the City from licensing such spaces to third parties, so long as at least the number of spaces licensed to Licensee remain unassigned among the two structures, or from designating any such spaces for use by the public. 7. Closure of Facilities. The City shall have the right, on 3o days'notice, to close the Mall Structure or City Hall Structure, or both,temporarily to make necessary repairs or modifications or for such other purposes as may be reasonably required. Closure may be on less notice in the event of emergency or other non-foreseeable need for repair. In addition, Licensee acknowledges and understands that the City is in the process of redevelopment of the Carousel Mall and that such redevelopment may cause the permanent closure of the Mall Structure. Permanent closure of both the Mall Structure and the City Hall Structure for any reason shall terminate this Agreement. 4 2017-13 8. Eminent Domain. If any part of the Mall Structure or the City Hall Structure is taken by eminent domain,the compensation for such taking shall belong to the City, except for relocation expenses paid or awarded to Licensee. 9. Loss or Destruction. Loss or destruction of any of the parking spaces licensed to Licensee under this Agreement shall terminate this Agreement as to those spaces,without liability on the part of either of the Parties. 1O. Possessory Interest Tax. The property interest created by this Agreement may be subject to property taxation, and Licensee may be subject to the payment of property taxes levied on the interest. Licensee agrees to pay when due any possessory interest tax that is levied on Licensee's right to the use of parking spaces under this Agreement. 11. Indemnity. Licensee agrees to defend, indemnify and hold harmless the City against all claims and any loss, liability, or damage of whatever nature arising out of or in any way relating to Licensee's use or occupancy of parking spaces pursuant to this Agreement. 12. Insurance. Licensee shall maintain the following policies of insurance throughout the term of this Agreement: (a) Commercial general liability coverage, including coverage for assumed contractual liability under this Agreement, of at least $2 million aggregate per occurrence. The City and its elected officials, officers, employees, and agents must be named as additional insureds. Coverage must protect against claims for bodily injury, personal injury and property loss or damage based upon, involving or arising out of the use or occupancy of any of the parking spaces licensed to Licensee under this Agreement. Coverage shall be on an occurrence basis. The policy shall not contain any intrainsured exclusions as between insured persons and organizations, and the insurer shall waive subrogation as against the City. Coverage shall be primary to and not contributory to any insurance carried by the City. Any and all City insurance shall be considered excess insurance only. Coverage shall not be subject to cancellation or modification except on at least 3o days' notice to the City. (b) If and to the extent required by law, Licensee shall maintain workers' compensation or similar insurance in the form and amounts required by law. Insurers providing coverage shall be qualified to do business in California and shall maintain during the term of the policy an A.M. Best Financial Strength Rating of at least A and a Financial Size Category designation of at least V. Satisfactory evidence of coverage must be provided to the City before this Agreement will become effective. 5 2017-13 13. Default and Cure. Failure to perform, or material delay in performing, any material term of this Agreement shall constitute a default. The defaulting Party shall have thirty(30) days after notice of default to cure the default and pay any consequential damages to the Party damaged by the default. If the default is not timely cured, the non- defaulting Party may, at its option,terminate the Agreement and seek all available legal remedies. 14. No Waiver. Delay by a Party in asserting or failure to assert any right or remedy under this Agreement or provided by law shall not constitute a waiver of said right or remedy. 15. Entire Agreement. This Agreement is the entire agreement of the Parties concerning the matters addressed herein and supersedes all prior and contemporaneous expressions, discussions, negotiations, or agreements with respect to those matters. 16. Approvals. This Agreement shall not be signed on behalf of the City, and shall not be effective, until the City Council of the City, also referred to as the Common Council ("Council")has approved the Agreement on behalf of the City. 17. Modification. This Agreement can only be modified in a writing signed by all Parties. Any modifications must be approved in writing by the Council. 18. Choice of Law; Venue. This Agreement and its interpretation shall be governed by the law of the State of California including, as applicable, the City of San Bernardino Municipal Code. Venue for any legal action arising out of this Agreement shall be in the Superior Court of the State of California for the County of San Bernardino. 19. Interpretation. Neither of the Parties shall be considered to have drafted this Agreement,for purposes of the rule that ambiguity in an agreement shall be construed against the drafting party. 20. Severability. If any provision of this Agreement is declared by a court or other entity of competent jurisdiction to be invalid or otherwise unenforceable, all remaining provisions not affected by said declaration of invalidity or unenforceability shall be fully enforceable. 21. Additional Documents. The Parties agree to execute such additional documents as may be required to effectuate the provisions of this Agreement. 22. Authorization. Each of the Parties certifies that the individual executing this Agreement on its behalf has the authority to do so. 6 2017-13 23. Notices. Notices or other communications under this Agreement shall be in writing and shall be deemed to have been properly given on the day delivered in person, or seven (7) days after deposit in the United States Mail, postage prepaid, certified with return receipt requested. Notices shall be given at the following addresses: City: City of San Bernardino Office of the City Manager 30o North`D' Street, Sixth Floor San Bernardino, CA 92418 Attn: City Manager Licensee: 32o N. E Street, LLC Dillon Gerardi Hershberger Miller&Ahuja, LLP 5872 Owens Avenue, Suite 200 Carlsbad, California 92008 Either Party may change its address for purposes of notice under the Agreement by giving notice to the other Party in accordance with this Section 23. 24. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed to be an original. CITY OF SAN BERNARDINO By: Date: 72017 Title: 7 2017-13 32o N. E STREET, LLC By: Date: , 2017 Title: APPROVED AS TO FORM: Gary D. Saenz, City Attorney By. 8