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HomeMy WebLinkAboutR15-Redevelopment Agency - . RmQVELOPMENT AftENCY..Qu;ST FOR b6r..1SSION/COUtICIL A~ION ~m: ~t: GLENDA SAUL Subject: MENTAL HEALTH ASSOCIATION Redevelopment Agency Date: DECEMBER 27. 1985 Synopsis of Previous Commission/Council action: -In January, 1985, the Community Development Commission bought the old "IMA" building for $600,000 and leased the property to the Mental Health Association, with monthly lease payments in July, 1985. -In May. 1985. the Mayor and Common Council approved $15,000 in CDBG funding for the Mental Health Association's Alezheimer's program. Recommended motion: (MAYOR AND COMMON COUNCIL) c Rescind Community Development Block Grant appropriation of $15.000 for the Alzheimer's program. ,~~ Signature Contact person: Glenda Saul FUNDING REQUIREMENTS: Amount: $ NIA Phone: 383-5081 Ward: NIA Project: NI A Supporting data attached: Staff report No adverse Impact on City: C1Cil Notes: Date: January 6, 1986 Agenda Item No. /5 ... - CIW OF SAN BERNARDaQo - REQUQr FOR COUNCIL AC.wON liP"...... '- c c 75-0264 STAFF REPORT In January, 1985, the Community Development Commission authorized the purchase of the IMA building for $600,000. Later that same month, the Mental Health Association took occupancy of building, with lease payments beginning in July. 1985. Mental Health made the first monthly payment and has missed the last five (5) payments totaling $19,500.00. Following is summary of the Mental Health lease terms: YEAR LEASE RATE TOTAL ANNUAL PAYMENT 7/1/85 - 6/30/86 7/1/85 - 6/30-86 7/1/85 - 6/30/86 7/1/85 - 6/30/88 7/1/85 - 6/30/89 $46,800.00 $62,400.00 $78,000.00 $93,600.00 $109.200.00 $390,000.00 .30/sq. ft. .40/sq. ft. .50/sq. ft. .60/sq. ft. .70/sq. ft. TOTAL LEASE PAYMENTS: 1. Mental Health Association shall have no lease payments due prior to July 1, 1985. 2. Lease shall be for a period of five (5) years. 3. Mental Health Association shall be guaranteed the unequivocal right to purchase the building in the fifth year of the lease. Purchase price will be $600,000.00 plus interest, less any payments made under the lease. Interest shall be at the rate of interest Agency is paying to the seller. 4. After the fifth year of the lease, if the option to purchase is not exercised, Mental Health Association shall be offered five (5) year options on the lease for a maximum of four (4) times. 5. At the end of each five (5) year option, Mental Health Association shall have an option to purchase property at appraised value. Appraiser shall be chosen by agreement of both parties. If no agreement can be reached, an impartial arbitrator shall choose an appraiser. 6. Lease shall stipulate that the Redevelopment Agency offer the space to Mental Health Association at a below-market lease rate in lieu of relocation benefits or any claim to leasehold interests. In November, 1985, Agency staff met with Tom Wojciehowski, President of Mental Health Board, regarding the lease problems and organizational and fund raising difficulties the Association has encountered. In short, Mental Health Association has experienced severe financial problems and the Executive Director resigned her post effective October 7, 1985. c c c .... c :,) o o Based upon the above meeting, Mr. Wojciehowski sent a letter to the Agency Executive Director (attached) describing the current situation and the actions taken to date by the Association. The County of San Bernardino Mental Health Department has conducted an onsite review of the program and has agreed to conduct a financial audit of the organization within the next thirty (30) days. Mental Health is requesting that the Agency delay any action regarding the lease until the audit report can be obtained from County Mental Health. Mental Health has also requested that the 515,000 the Mayor and Common Council approved for funding of the Alzheimer's Program be returned to the City. The Redevelopment Committee suggested that action on this matter also be delayed until the audit is complete and the board and staff of Mental Health are able to determine the future course of the organization. On December 13, 1985, Mr. Wojciehowski sent a letter to Mayor Wilcox requesting a meeting and assistance from the Mayor's office in resolving their organizational and financial difficulties (also attached). This letter was briefly discussed at the Redevelopment Committee meeting of December 19, 1985. On December 27, 1985, staff spoke with representatives of the Mental Health Association regarding the status of the audit to be conducted by the County Mental Health Department and the Alzheimer's Program. The field work on the audit is scheduled for completion on Tuesday, December 31, 1985. Staff will be confering with County officals once the audit is complete. Mental Health once again indicated that they cannot comply with the fire marshal's requirements for changes to the physical plant for the Alzheimer's program. Because there has been no activity in this program and due to the lateness in the fiscal year, staff recommends that the Mayor and Common Council rescind their previous action appropriating $15,000 in CDBG funds for the Alzheimer's program. 470L .... ~ .. ~;~~ r ~6.'~e '-' 00:> Mental Health Association of San Bernardino County lOl_No. hI" Street . San Bernardino. California 92410 . 885-6843 " November 5, 1985 Glenda Saul, Executive Director San Bernardino Redevelopment Agency 300 North "D" Street San Bernardino, CA 92418 Dear Glenda: After meeting with two of your staff today, Sandra Lowder and Kenneth Heuderson, I felt it wise to write you with update information on our agency. Our Executive Director, June KIebel, resigned her positi0n as of October 7, 1985, and we are working very hard to remedy some of our fin.111Cinl difficulties, including rent due the San Bernardino Redevelopment Agency. c To put it bluntly, the Hental Health Association got over its head when it signed the lease for its present location. Th~ spdce is much too large for our use: and little has been done as promised to fill vacant space. For exar.-,ple, the Alzheimer's l'rograr.;, which "a, funde'd for $15,000 by the City of San Bernardino, cannot be opened du(' to CXt~11~iv~ r~ncvalion needed to our bui]ding to pass codes set by the Fi rc N.:lr~hiJl. For Lld S Teason I would suggest that the"'money be returned to the City so th.nt .:1 needy, worttl\.;hilt: service can: be provided to local residents. I have met "dth Bob Hartinez from the County Ikpartment of ~lental H,-,al th and he will be initiating a financiol audit of Ollr agellcy. ~len tllis is completed, ~c \,,"i11 have a much better picture oi ,dl~~t \,'(."> can nfford Oll a munthJy basis. L\: also ,,'ill be v,'orking ou a plan of acti0!1 to r(>ducl' our Cjunrtl-'rs to ,.~hat ,,'~ C;.il' afford. At that tir.}(', 1 v,'ouJd lik(> In sit ,11'0""':1 \.:lth ])('rt inC>llt rnurJH.!rS of yr,U( staff ilnd TL:'nct:;\'riat.? 51) t:l.1t L1::~ .1Fl'I~L.:>' C~l:l ~'.i1l:llll'Ll11,\, I!l(,('t it~, L,b1igatioLs. hTller. 1 n:et \.dtb Jack Strickler for Sl)]~)l' .1d\'il'l', ill.' llL,'ipcd 1-,:' f'll'('rin6 nlL- in your dir€cticn. I "..JoulJ like tc' work out a :-->i:>tt.leI11L'j)t that \o.'l~ ~d.1 C,111 agrl2'E' to and :find 81-: ac.ceptable, prof(~.sf;icnal ~c,jl.lti('n. P1E.:as.2 cor.sid-2r my rl!que~t to \,'ait. 30 di1Y~ fer ,'1]) audit" AftL:r thDt m~: lioi'I..~; are to cunference \,'ilh your stnff, (!j-.'{. t111.."!1i .1lTllrat.... fi;:'.l1h'S, and com( to cd'; agreem0Dr that is suitahle to a]) ~(~]~:('r-~(.J. c A f',it')n Pr"n: T,p( D"dddihk Orpnil,l!\lllll ~- . r- \,.... c c - c o o :) Mental Health Association, Novemher 5, 1985, Pnge 2 , Call me if any further clarification is needed. I look forward to meeting you, and hopefully over something a little mOfe ple3,;ant. Sincert:ly, ./1 ~""IJ (? . , - J ~ A.. jJt;"~':"L ."-../ bv_ VU/'. ..,.,/, Thomas Wojcieho~ski President Th"'~;nh cc: Jack Strickler, Councilman Sandra A. Lowder, Manager K~nneth J. Henderson, Manager Bob Martinez, Department of Nental Health Dr. Louise Burton, Vice Pr0sident .' - MItM{ ~l It, o <) :> Mental Health Association of San Bernardino County lor No. "I" Street . San Bernardino, California 92410 . 885-6843 \----: "'J Q~. -_. i- . tt~il C ~4"'~ December 13, 1985 }hyor Evelyn Wilcox City Hall 300 North "n" Street San Bernardino, CA 92401 Dear Mayor Wilcox: This letter is written to you on behalf of the Board of Directors of the Mental Health Association to help advise us on our dilemma of residence at 101 North "I" Street. It is hard to describe in detail our problems to date, but I do feel it is impor- tant to meet with you to briefly outline our concerns and seek advice. I have met with one Council member, two Redevelopment Af(ency staff and numerous commun- ity members. In those meetings I have received advice varying from "this issue should be looked at by the Grand Jury" to "the rent is so reasonable that it's comparable to warehouse prices.1I c As it stands now, I know we do not need a warehouse and we are to operate on a contract that was not signed by any board member or present staff. As a prior- ity, I have authorized all payments to kC0p up with utilities and maintenance. Yet, renegotiation is definitely in order if we are in fact to stay at our pre- sent location. The facts as \,7e know them could be aired in ten minutes. I am requesting one half hour of your time', at your convenience, to seck advice from you before I continue on. I would also like to request th<1t Elvin :Kicks, one of my board members from Assemblyman Eaves office, accompany me to help me with the histor- ical perspective. Please have Nan Hagman called at our office f(lT a time tllat you could fit us in, or at a lunch time that would be acceptahle. I am must interested in discuss- ing this issue before any other action brl'aks. Although this is not the best circumstances to m('et the Mayor under, I do hope you will honor my request. I look fon.,':lro to wurld.ng "lith you on the mental health needs of the citizens of San B~rl1c1rdino over the coming years. In con- cert, I am sure \\'e can really make a difference. /' c ThTW: nIl ~dIA~wf~' i'homas H~j::zlO;JSki President cc: Dr. Louise Burton, Vice Presidcllt Elvin Ricks, Finance Committee. . Glenda Saul, Director, Redevelopment ^~~('n('y../ A Non Profil Tax Deductible OrganizRtion .....'~.