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CIT~OF SAN BERNARDI~ - REQUEU FOR COUNCIL AC1JN
Dept:
Community Development
1~97 OCT -8 IJ!:'I!
CDBG DEMOLITION ASSISTANCE REQUEST
EMPIRE BUILDING MATERIALS - 940 WEST
SECOND STREET
~n
From:
Kenneth J. Henderson, Direck'fC'D. _ AOMIM. 5tt,if~t:
Date:
October 7, 1987
Synopsis of Previous Council action:
NONE
Recommended motion:
Community Development Citizen Advisory Committee Recommendation:
That the Mayor and Common Council approve demolition assistance in the form of a loan not to exceed
$20,000 to Mr. Stanley Lang, owner of the building located at 940 West Second Street, San Bernardino, subject
to the negotiation of an appropriate interest rate and that the loan be paid in full upon receipt by Mr. Lang of
insurance settlement.
Staff Recommendation
That the Mayor and Common Council approve request for demolition assistance in the form of a loan, authorize
and direct Community Development staff to solicit bids, se ct the lowest reasonable bid, and direct staff to
negotiate an appropriate interest rate and amortization sc dule, direct City Attorney to prepare an appropriate
loan agreement and authorize Mayor to execute same.
Signature
Contact parson: Ken Henderson/Lisa Dickey
Phone:
5065
Supporting data attached:
Yes/Staff REport
Ward:
3
FUNDING REQUIREMENTS:
Amount: N/A
Source:
( ACCT.
( ACCT.
NO.) N/A
DESCRIPTION)
N/A
Finance:
Council Notes:
.....n.,Il..'
Agenda Item No.
9
CIT~ OF SAN BERNARDI~ - REQUEQ FOR COUNCIL AC~N
STAFF REPORT
In July, 1987, Lang's Empire Building Materials was destroyed
by fire. The Fire Department has since been in contact with
Mr. Lang, the owner, and has issued a citation because
clearance of the site has not been accomplished.
On August 25, 1987, Mr. Lang contacted Community Development
staff regarding the CDBG Demolition Assistance Program (see
attached) and asked for consideration of his request for
funds to clear the property located at 940 West 2nd street.
On September 3, 1987, he was advised that the request would
be forwarded to the Community Development citizen Advisory
Committee (CDCAC) for review and that if approved, the
assistance would be in the form of a loan, as commercial
properties are not eligible for grants.
On October 1, 1987, the CDCAC met on this matter. The
Committee approved a demolition assistance loan subject to
the following conditions:
1. Loan not to exceed $20,000.
2. Loan subject to negotiation of an appropriate interest
rate.
3. Staff solicit demolition bids.
4. That the lowest reasonable bid be selected.
5. Loan be paid back in full upon receipt of insurance
settlement by Mr. Lang.
The staff recommendation is that the Mayor and Common Council
authorize demolition assistance subject to the selection of
the lowest reasonable bidder and the negotiation of appro-
priate interest rate and amortization schedule. Further,
that the City Attorney be directed to prepare a loan agree-
ment and the Mayor authorized to execute same.
Kenneth J. Hen erson
Director of Community De elopment
KJH/LRD/lab/0524
attachment
10/7/87
75-0264
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Ms. Lisa Dickey
City of San Bernardino Community Development Dept.
300 North "D" Street
San Bernardino, CA 92418
940 WEST SECOND STREET
SAN BERNARDINO, CALIFORNIA 92410
r.-'- -88li-SZ6!l ".825-7327
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117t W, LA CADENA AVE
RIVERSIDE, CALIFORNIA
682-4560
August 25, 1987"
Dear Ms. Dickey,
I had a Building Material Supply house at 940 West Second Street here
in San Bernardino which burned on this past July 7th, 1987. We had been at
this location since October 1st, 1964. The building and drive-thru consisted
of approximately 12,000 square feet in size and was completely burned and is
not repairable.
Except for some extremely helpful and nice people in the Fire Depart-
ment and the Building Department who helped me to open our doors again within
a matter of days at 950 West Second Street, I have encountered nothing but
problems with insurance company in trying to settle things.
The building was insured for two hundred thousand, an amount with which
I thought I could rebuild another metal building if anything ever happened.
Just the month prior I had turned my insurance agent down when they wanted
increase the amount to two hundred and fifty thousand. I felt I had enough
to do the job. The talk the insurance people have given me so far runs like
this: Because it is older than forty years, they seem to automatically want
to cut the amount by fifty percent to one hundred thousand. Then they went so
far as to say it could be depreciated back to thirty thousand because it was
as old as it was. Since then I have been made aware of the fact that the
demolition charges have got to come out of the building replacement money from
the policy. The bids for demolition and removal range from $17,000. to 28,000.
which leaves from $1200. to $13,000. as a down payment to replace a building
I thought could be replaced for around $200,000. (which I was paying premiums
for and thought I would be getting.
Ms. Dickey, I am telling you all of these things as I understand that,
through the Community Development Department, the City of San Bernardino has
set aside certain Community Development Department Block Grant Funds for the
purpose of demolition and clearance in situations such as this. I understand
that our business is within the Enterprise Zone and also within the City's
Special Impact area.
To me, the tragedy of all of this is that I have been paying on this
building for such a long time and I was only $4400. from having it paid off.
I was looking forward to being completely out of debt. The first part of next
year and it would have been paid for.
I have requested an extension of time to clean up the mess from the Fire
Department, Fire Marshall Mikel Park. He told me to ask you to write him)
letting him know about how much time we would need, 'in order for all the paper
work to go through as well as the actual clean-up time. At this time, we have
until the first week of September. I had asked him for a 30 day extension, but
I did not know how much time your department may need. I thank you and
appreciate anything you can do for me. You may contact me at 950 West Seconder
at 885-5769 or 825-7327. Thanks again.
ServIng Ihe Inlend EmpIre with Melerlell lor Ihe Plellerlng end Dry
Since 1964