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HomeMy WebLinkAboutR05-Economic Development Agency 4 - ~ -- - -- - - - - ~ AGEaA ITEM INFORMATION SU,AtARY GENERAL INFORMATION: e SubJec1 CL (r-f' Q. c".etL i- ASSOGIATE'S" e e Author ~ Ex1.34~1 Committee Filing Dales II 1'11/89 Meeting Dates II b2/gy Funding Requirements N III CommissionJCouncil 1/ M In 11121 h'l CLEARANCES: Yes NlA III AI:counting [[] ~~.."-. ~ ~ City AdministralDr Date o o ~ o Ward I Project Area C C RDA committee ffICOmmendatlon INFORMATIONAL DATA FORWARDED TO CITY DEPARTMENTs/COUNCIL OFFICES: Date I~ ~ '~1 By By Dale Department Department COMMENTS/CONCERNS: Include pertinent comments and concerns of offices and persons clearing the summary, such as controversial Issues, time constraints and funding complications. Indicate dates when action must be taken. RDA -174 Budget Author~ RDA MANAGEMENT REVIEW: 'Jj:~{;~l. ~~&~ CITY DEPARTMENTAL REVIEW: \\- 2.0 -li"t //-.9.P-N II /1..0 , Date By Depl Depl Sent 10 Mayor'S Office Council Ward Council Ward Council Ward Council Ward REV. 6-29-89 -itS' . . . Redevelopment Agency . City of San Bernardino 300 North "D" Suee~ Fourth Floor . Sill Bernardino, Colifomia 92418 (714) 384-5081 FAX (714) 888-9413 .. ID~; ~ W" . NOVEMBER 27, 19B9 CLIFF R. CAREL & ASSOCIATES - DISPOSITION AND DEVELOPMENT AGREEMENT Synopsis of Previous Commission/Council/Committee Action: 12/20/82 Resolution 4432 authorized DDA. 03/03/83 Amendment; Resolution 4459. 05/07/84 Request for assistance in construction of storm drain; referred to Staff for review. 11/27/B4 Approval, in concept, of Second Amendment. 02/04/85 Approved Resolution 4717 authorizing Second Amendment. 06/15/87 Received and filed briefing paper. (COMMUNITY DEVELOPMENT COMMISSION) ~ Recommended Motion: That the Commission declare ClIff R. Carel & Associates in default of the Disposition and Development Agreement and authorize the Executive Director to pursue all remedies available to the Agency under the Agreement. Respectfully Submitted, Director Supporting data attached: YES Ward: FUNDING REQUIREMENTS: Project: CCE Commission Notes: RT:GW:sm:2476H Agenda of: December 4. 1989 Item No. ~ - - -- ~ --- .... - - --- . . Redevelopment Agency , . S T A F F R E P 0 R T It Is requested that the Commission declare Cliff R. Carel & Associates In default of the DDA and authorize the Executive Director to pursue all available remedies. BACKGROUND e In December 1982, the Agency entered Into a DDA with Carel for the development of five parcels of land In the Central City East Project Area. The Agency conveyed the land to Carel for $1.00 and agreed to pay a reimbursement of $131,000 for off-site Improvements. Carel agreed to pay to the Agency either 5t of the net sales price of each unit sold or 5t of the gross rentals. In February 1985, the Agency also agreed to reimburse Carel up to $150,000 for the construction of a storm drain across Phases II & III, and Carel agreed to construct the balance of the storm drain across Phase V to Waterman Avenue. The Agency reimbursed Carel the $150,000. However, Carel never completed the storm drain to Waterman Avenue. Phases I , II and III are complete. Phase IV to consist of 70 apartment units with a minimum value of $2,406,000 was to be completed by September I, 1987; however, no work has started. Phase V to consist of 170 mini storage units with a minimum value of $450,000 was to be completed by February I, 1987 but construction has not started. Due to the failure to complete the storm drain and the failure to construct Phases IV and V, Carel and Associates are In default of their agreement. Staff has been negotiating with Carel to resolve the default. The land for Phase IV was previously conveyed to Carel who encumbered it with approximately $100,000 In liens. In October 1987 Carel met with Agency staff and a memorandum of understanding was signed saying that Carel and Associates would: a) Suspend Phase IV until the preferred land use alternative of the General Plan Amendment Is adopted by the City. b) If the land use In the preferred alternative continues to be multi-family the present obligation to construct a residential project will remain. If the land use Is changed to commercial, then the agreement will be amended to provide for a reduced value commercial project. If the land use Is some third alternative then a new scheme for development will be proposed by Carel for Agency consideration. c) Release Phase V to Norsa, Inc. together with the obligation to complete the storm drain. d) Return Phase IV to the Agency (without encumbrance) if development under (b) does not proceed. e RT:GW: sm:2476H 2 . . Redevelopment Agency ~ Norsa, Inc. would: a) Complete the storm drain to Waterman Avenue ready to connect to the regional collection facility. b) Suspend development of Phase V until the preferred alternative for the General Plan amendment Is adopted. c) Construct the mini-storage project described in the current agreement If the preferred land use alternative Is for commercial use, and If the Agency succeeds In obtaining release of the Department of the Army of the storm drain easement area. The Agency would (contingent upon Commission approval): a) Contribute up to $50,000 as additional assistance to remove the bridge on Third Street and reconstruct the pavement to replace the bridge if Carel proceeds with the development of the multi-family or commercial projects. b) Negotiate with the Department of the Army for release of the storm drain easement. . . c) Transfer Phase V to Norsa when construction Is ready to proceed on the mini-storage project. Despite the agreement, It eventually became clear that Norsa, Inc. would not construct the storm drain unless It was also clear that Phase V could be successul1y developed. Various problems with the alignment of the property boundaries of Phase V make It difficult to develop and it may be desirable to develop an adjoining parcel simultaneously for a more efficient design. Existing uses on the adjacent parcels prevent their development at this time. Neverth1ess, construction of the remainder of the storm drain Is an obligation of Carel which was undertaken at the time the Agency agreed to provide $150,000 In assistance for its construction. The agreement provided for "first dollar" reimbursements and was used In construction of the west portion. The east portion remains an open ditch through Phase V. On December 9, 1988, staff met with Carel and requested that he submit a development proposal contingent upon the final land use designation adopted by the City In its comprehensive General Plan amendment. On February 24, 1989 Carel suspended negotiations pending adoption of the new General Plan. The General Plan was adopted on June 2, 1989 and on June 16, 1989, another request was made to Carel to submit a proposal. On July 6, 1989 Carel stated that he planned to construct a 110 unit senior citizen apartment complex and would submit the balance of the requested Information in 30 to 40 days. RT:GW:sm:2476H 3 -- - - ~ -- - . . Redevelopment Agency , e On August 19, 1989 Carel Informed the Agency that his architect was proceeding to finalize drawings and that financial pro formas would be submitted after a preliminary plan check approval was obtained from the Planning Department. On August 30, 1989, staff reminded Carel, by means of the attached letter, that plan check approvals are not required before submitting a concept proposal to the Agency. They are, In fact, undesirable because considerable expense can be Incurred in working drawings that are prepared for an unapproved concept which may be unacceptable. On September 15, 1989, Carel responded with the attached letter requesting that an "official position" be determined with respect to their default status. RECOMMENDA nON The major unresolved Issues are: e - Carel's failure to complete the balance of the storm drain construction; - Carel's request that the City provide engineering plans and specifications for removal and reconstruction of the "E" Street bridge. - Carel's failure to submit a proposal for analysis and for use as a basis of suggesting an amendment to the present DDA. Cliff Carel & Associates has been In default of the DDA since September 1987. The Agency has attempted to resolve the default in numerous meetings with Cliff Carel. However Mr. Carel's attached letter Indicates no concept plan or relevant pro forma Information Is to be supplied unless the Commission makes "further direction and determination" available. Under the DDA the Agency can declare a termination in favor of the Agency of the title and all rights and Interests In the property. It Is recommended that the Agency declare such a default and record a Declaration of Forfeiture causing a reversion of Phase IV to the Agency. Revesting in the Agency would not eliminate the existing $100,000 encumbrance on Parcel IV. Staff estimates the present fair market value of the land to be approximately $550,000 to $700,000. e RT:GW:sm:2476H 4 - - - - ... - . . -.J I I e WATERMAN AVENUE e > - - - \ ALLEN ST - ti w ~ - - > - f- a: ::) 0 (,) ti w a: Ii; ::r: f- a: ::) o &I. e SIERRA WAY II L ~ ~ ti w ~ Q a: ~ f- Ii \I ., . Redevelopment Agency · City or San Bernardino ~ NanII "D"..... hda FIaar . ...___ ~ c.JiraIIIia ~1. (714) 314-5011 'AX (714) Dl-9413 J-. I . L . August 30. 1989 Cl1ff Carel & Assoc1ates 76-629 Oak Flats Dr1ve Palm Desert. CalIfornIa 92261 Re: DDA - SENIOR CITIZENS COMPLEX Prtde ~ ~- Dear Cl1ff: We are 1n receIpt of your August 19. 1989 letter. I would lIke to remInd you that you are In default of the DIsposItIon Development Agreement. It Is not necessary that you obtaIn plan check approval before submIttIng your proposal to the Agency. I urge you to subm1t your proposal v1thln the next f1fteen (15) days or the Agency v111 have no recourse except to recommend to the CommIssIon that ve pursue our remedIes under the DDA. If you have any questIons. call me at (714) 384-5081. SIncerely. fi~ -/1. .AJ:,~ Gary w\lgoner <...J SenIor Project Manager - GH:sm:2305H e ._- - ~ - - . 76-629 ClEIk Flats Drive- ~~ ........ II. 0....1'''... (619) 340 1624 JMl!l.ll,. II{ - 111.-- 'lIIJL I . ~'q u.. - ---_- -v'. ;. Mayor W. R. "Bob" Holcanb City of san Bernardino City Hall, Sixth Floor 300 North "0" street san Bernardino, CA 92418 RE: CUFF R. CAREL & ASSClCIA'mS IE\IEUIlMENr STA'lU> AND AC1'lOO ~TIOOS; PARCELS 2 AND 3, MAP 9122 AND PARCEL 9, Ml\P 7140 Honorable Mayor Holcanb: Referencing our meeting with you am a staff persal in your office this date and the general cx:nclusioos reached relative to Cliff R. Carel & Assoc- iates redeve10pnent project status am meeting at;jaa..-y/city requUsetts, the following actioos were,~ --ed a}:pL..",date: . 1. '!bat an official position be det:emined by the RedeYelopnent O:mnis- sion relative to the purported Cliff R. CaIel & Associates "default" status as indicated in a letter dated August 30, 1989 frail the Redevelop- ment 1qmcy to Cliff R. ,Carel & Associates. ()]r positioo has been repeatedly made that the ultimate deteJ:minatioos of zaling and density, as adopted in the City of san Bernardino General Plan, the matter of engineering design am decisioo relative to the r;e- IIDVal of the 'Dti.rd street Bridge to the east of Sierra Way am a determi- natioo made in cx:njunctioo with the Navy/Marine Cbrps Reserve leasehold agL..anelJt has effectively caused Cliff R. Carel & Associates project con- struction delay, professiooal credibility less am significant financial damage. 2. '!bat a request be made of the PhgiMering Department to provide direc- tioo, plans and possible financing altematives for the nmoval of the '!'hird street Bridge am the r-"""$"aJ:y street reccnstructioo, to allow for prq;ler architectural design for ingress am egress in IIUppO%t of our prcr prosed 110 .:t senior citizen aparb\Ent project to be coostrocted upal Par- cels 2 am 3, Map 9122. As was indicated by our architect, Michael J. tllrphy (san Bernardino, 888-0459), his finalized plans and those relevant financial pro forma pro- jectioos depend upal further directioo am determinatioos by the Redevelopnent O:mnissioo and/or the Mayor and Cl..II'....' OJuncil. Please accept our "M-'Leclatioo for the suggestioos provided by you and your staff 1Ill!IItler. e \~~ing~ c: ~teven H. Dukett . Roger Hardgrave . . . CliffCarel&Associates 73-629 Oak Flats Drive Palm Desert, CA 92261 (619) 340-1624 December 4, 1989 Carmunity Develq:rnent Carmission City of San Bernardino City Hall - c/o Redevelopnent Agency 300 North ''D'' street San Bernardino, California 92418 RE: CLIFF R. CAREL & ASSOCIATES DISPOSITIOO AND DEVEWPMENT AGREEMENl' STA'lUS Honorable Members of the Ccmnission: Cliff R. Carel & Associates did, in a letter directed to Mayor W. R. "Bob" Holcanb dated September 15, 1989, request that an "official position" along with "further direction and detenninations" be rendered to allow us to remove the redevelopnent impediments which have prohibited the canpletion of our several final phases of project cxmnitrnent. Addressing the noted "major unresolved issues" as identified at the con- clusion of the staff Report being presented to the Ccmnission on this date, the following amplifications and positions are being presented: CAREL'S FAIWRE ro C01PIEl'E THE BALANCE OF THE S'JXlRM DRAIN (lliISTRucrlOO After the signed Disposition and Developnent Agreement (DDA) in 1982 was to be implemented, the City of San Bernardino detennined a location for a new Central Fire Station to be relocated fran its old location within the County Superblock. As an econanic and construction timetable expediency, we have as- sumed, an originally planned alignment of the Warm Creek Channel storm drain- age system was changed fran its proposed placement in Waterman Avenue and then to run to the concrete channel imnediately west of Sierra Way within Meadowbrook Park. Cliff R. Carel & Associates was not made aware of this predetennined alignment prior to signing the basic OOA document. Olr subsequent request for financial assistance was a direct result of being uninformed of the pro- posed actions and intent of the city. /s- . . , Page 2 Catmunity Developnent Carmission December 4, 1989 CAREL I S RE:t;lJEST 'llIAT THE CITY PROVIDE ENGINEERING PLANS AND SPlXU"J.CATIONS FCR REMJ\IAL AND REXmSTRUCl'ION OF THE 'lHIRD STREET BRIDGE As documented on Irore than one Engineering Department annual proposed budget subnission, a departmental request has been consistently proposed to remove the '!hird Street Bridge and to provide funds in proportions of 86% Federal Aid Urban Funds and 14% :weal Transportation Funds to accanplish the proposed proj ect. These requests were not approved by the Mayor and Carmon Council. According to our CMl1 understandings and records, also concurred upon with an Redevelopnent Agency (RDA) Carmittee Briefing Extract for April 30, 1987 and stating, "Please note that nowhere in the aqreement is Mr. Carel 0b- ligated to widen '!hird Street or to remove the existing bridge." Until the matter of the bridge removal and street reconstruction, along with curbs, gutters, sidewalks and lighting, have been engineered, the Phase IV element of the Cliff R. Carel & Associates project cannot proceed with infonnation to accurately present a financial pro fonna or design for proper grading, ingress and egress for the developnent site. AIrong other proposals, we have recannended that the concrete and other bulk residual fran the demolition of the bridge might best be used for land- fill and reclamation of a cu=ently fallow and unused section of Meadowbrook Park which is bisected by a useless and unnecessary watercourse channel. CAREL'S FAILURE 'ID SUBMIT A PROPOSAL FCR ANALYSIS AND FCR USE AS A BASIS OF StmESTING AN J\MENUI1ENT 'ID THE PRESENT IDA In recent dialogue with the RDA, the ~, INC. assigrnnent of interest and participation on the Fhase V element of the project, as far as Cliff R. Carel & Associates is concerned, is IroOt. . . . . Page 3 Cc:mmmity Developnent Carmission December 4, 1989 With the implementation of a realistic developnent canpletion timeframe, no further request for RDA assistance is being proposed. The DDA addresses the installation of a regionally oriented box culvert at Watennan Avenue; We will provide both building architectural drawings and a pro fonna for Phase IV of our developnent; however, a pro fonna will serve no specific pur- pose beyond the CCl'lveyance of infonnation. PHASE V - APPRO\1ING THE BUIIDING PROPOSAL AND PIJlNS, AND, S'IDRM mAIN EXTENSIOO cnlPLETIOO The plans for Phase V (Parcels 1, 8 and 9, Map 7140) must remain contin- gent upon the city amending an existing lease agreement with the U. S. Navy for the release of an existing stonn drain easement, realigning property boundary lines, deeding the subject property for stonn drain extension con- struction financing and canpletion, along with the construction of accept- able building improvements. Cliff R. Carel & Associates, at this time, has a potential user for the property; the prospect is a sizeable independent produce marketing opera- tion based in the los Angeles area. DDA CUIDITIOOS STIPULATE THAT PROPERTIES MUST BE BUIIDABLE WHICH NffiATES CURREN!' ''DEFAULT'' STATUS CLAIM As stipulated in a Cliff R. Carel & Associates letter attachment to the DDA Second Amendment, dated January 23, 1985 and recorded as San Bernardino County Recorders Office Instrument No. 85-032536, the developnent of any phase of the redevelopnent project will be performed in a timely manner and in good faith "unless impeded by imposed building conditions or restriction...." Both the matter of the Third Street Bridge removal and lease revision requirements with the U. S. Navy indicate significant present impediments. ....- - . . , Page 4 Camlunity Developnent Camtission December 4, 1989 '!base items indicated within the preceding paragraphs generally indicate the prohibitions and limitations with which Cliff R. Carel & Associates have been =nfronted. '!be remedy for those existing =nstruction deterrents lies beyond our =ntrol. AUTHORITY OFFICIALS ACl'ICl'lS AND EXECUITVE 'lURNOVER alMPLICATICl'lS With an understanding that there was a recognized necessity to await the amendments to the city's General Plan and accept an imposed building moratorium, and, after adoption by the Mayor and Carmon Council, Cliff R. Carel & Associates have earnestly and eagerly pursued the =ntinuance of our project. We now have a specific understanding of the property zoning requirements and density allowances. Ccmpounding the delay as related to the General Plan, there has been an almost continual appearance and disappearance of RDA Executive Directors. A firm direction and philosophical understanding of our project objectives and problems, appreciated and evaluated on a continual decision making level, has been almost non-existent. Cliff R. Carel & Associates is dedicated to the maintenance of our high standards of building performance and the steadfast carmitment to providing attractive and affordable housing for our low and moderate incane citizens. With direction as requested and a revised and realistic construction build-out schedule as could be implemented through a '!bird Amendment to our existing IDA, we will attempt in every way possible ccmplete our carmitments to the satisfaction of all concerned. Respectfully sul::mitted, \, \ ( \ . ~I :. ~ ,I. I.. . ., 1 \, '" (1\.'. \ \. t\...,_, I... "-_. '-:J... \j. Cliff R. Carel- '-' Managing Partner ~ ,..", . :j : j . ,.1.. , ... H.o,:"~L. i ~2~!IL.:.-...J ~ ...{j. ...-8'I'ItIlIR'-. ~, .n~~-s~~~T.:>..~.:. !,,:. ~ ! ~ L ; ~ '," :i~':~fr ~ ,.:.. - .. ]-.,':':,';::;,:: ~-? (. !"i'~:.;.: .. f-.....~ I . run. -. -----: ;..., . . +.: ~ . . ., . . ,\0; . t II' ".! r-: . ~::::.~::J...:j:::.=- ljuun, , t . .t. L. -' I.~~ !5+~t-:. -....."... 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'" = a , m 0 .... ~ . . 0 '-TTT-r'i tll ir c' 3 3 3 m ; .. l.ie:.:.; ~ 0 , a s: c uliU_l_. c . !;> 0 , 5- 5- '!? ~ ; 2- ~ ,- ." m >< 5- .;: ~ 5' 0 '" n ~ " 3" " ':i . m . " , ;; a , 3 < "- ~ ~ a . . .:::~:. . .. ..... . ;.:"..,r . t': :x ,.; :i ~ r: ..; t': C :.i.,. :.: :.....-1...;......:__ :...; . . e" . ...--- . I .._~ [=:-::::::::11')": r:-""'''"' ' ..:~ L"i". . ..-.: fl .,. :< c :;: r: t': :2 ..; :>:: ~ t' r: I- .., K . t': ~ rt .., AVENUE :>:: t': c: t': < t': t' C '" :;: t': :2 ..; .1 :>:: t': '" C :>:: ..; . ..-..- I I r:....,.... . = " t,',:":", . ~:]~~.:T~-l, :!: fill' .,,-"" ' "" - - . - - - -- . GENERAL VIEW AND CONDITION OF PORTION OF PROPERTY NEAR 3RD-4TH AND ALLEN STREETS r I I "' _.._--.;:~"'" :~l" t,~ :~~:-~';'."ll ":H- 1'&"" ,~;Fj, 1. ACTIVE EXCAVATION TO REMOVE FORMER DUMP SITE SOIL AND DEBRIS. NOTE DEPTH OF SOIL TO BE REMOVED. "~':L:.-";"'". 2. VIEW OF EXCAVATED SITE, LOOK- ING FROM WEST TO EAST. 3. TYPICAL RUBLE CURRENTLY BURIED AS A RESULT OF DUMP SITE. . SHEET 1 OF f SHSETS . . , GENERAL VIEW AND CONDITION OF PORTION OF PROPERTY NEAR JRD-4Tii AND ALLEN STREETS (CONT'D) - ""'I! ~~ , .<, ~ . ... ' , /'i,.. c,.~-j , .1 4. VIE. ACROSS fORMER WATER- COURSE, LOOKING NORTH TO SOUTH TOWARD THE NEW FIRE STATION SITE. .n'I" 5. VIEW INDICATING LENGTH OF FORMER WATERCOURSE AND DETAIL- :NG CURRENT TERRAIN AND GRADES. ----.._-.._._---_._~~---_..__.._., 6. MORE DISTANT VIEW OF FORMER WATERCOURSE WHICH WILL REQUIRE FILL AND GRADING. SHEET 2 OF ,. SHEETS .,., ~.1. ; , -. ~ ,,'.I!: . ~.'. .. ....,. , -- ~..'.';;;;;~ :. <e'.,..........r.<.!'>.... #". " .---."..... .."'" - -'c, '''J, . ' FOUR (4) FOUR-FLEX UNITS 16 FA-vItI 4P4RTMENTS ~Ot'THSIDE OF COURT STREET -rti<,:: ,.~; :'~(-'.~;;' -' ~,... -~..: '.-':::w<i"":,.L :'_.. ..;' ...",.,., <~..."