HomeMy WebLinkAboutAgenda Package - StudySession_Apr11_2024
PALM DESERT CITY COUNCIL
STUDY SESSION MEETING
AGENDA
Thursday, April 11, 2024
3:00 p.m.
Council Chamber, City Hall
73-510 Fred Waring Drive
Palm Desert, California
NOTICE IS HEREBY GIVEN that the purpose of the Study Session is to review the items listed on the
agenda. No action will be taken.
This is a joint meeting of the Palm Desert City Council, Successor Agency to the Palm Desert
Redevelopment Agency, and the Palm Desert Housing Authority. Pursuant to Assembly Bill 2449, this
meeting may be conducted as a hybrid meeting allowing public access via teleconference or in
person, and up to two Councilmembers may attend remotely.
WATCH THE MEETING LIVE: Watch the City Council meeting live at the City’s website:
www.palmdesert.gov under the “Council Agenda” link at the top of the homepage, or on
the City’s YouTube Channel.
OPTIONS FOR PARTICIPATING IN THIS MEETING:
If unable to attend the meeting in person, you may choose from the following options:
OPTION 1: VIA EMAIL
Send your comments by email to: CouncilMeetingComments@palmdesert.gov.
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OPTION 2: LIVE VIA ZOOM
Access via palmdesert.gov/zoom or zoom.us, click “Join Meeting” and enter Webinar ID 833
6744 9572.
1.
OPTION 3: LIVE VIA TELEPHONE
(213) 338-8477 and enter Meeting ID 833 6744 9572 followed by #.1.
Indicate that you are a participant by pressing # to continue.2.
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3.
Pages
City Council Study Session
Page 2 of 30
1.CALL TO ORDER - STUDY SESSION
2.STUDY SESSION TOPICS
2.a STUDY SESSION: UPDATED MILLS ACT ELIGIBLE SCOPES OF WORK 5
RECOMMENDATION:
Provide feedback on proposed changes to the Mills Act Contract Guidelines.
2.b STUDY SESSION: UPDATE ON DINING DECK PROGRAM 19
RECOMMENDATION:
Provide feedback on Dining Deck Program
3.ADJOURNMENT
4.PUBLIC NOTICES
NOTE: Pursuant to Assembly Bill 2449, this meeting may be conducted by
teleconference. Study Session is accessible in person or on the City’s website:
www.palmdesert.gov under the Council Agenda link at the top of the page.
Agenda Related Materials: Pursuant to Government Code §54957.5(b)(2) the
designated office for inspection of records in connection with this meeting is the
Office of the City Clerk, Palm Desert Civic Center, 73-510 Fred Waring Drive,
Palm Desert. Staff reports for all agenda items considered in open session, and
documents provided to a majority of the legislative bodies are available for
public inspection at City Hall and on the City’s website at www.palmdesert.gov
by clicking “Council Agenda” at the top of the page.
Americans with Disabilities Act: It is the intention of the City of Palm Desert to
comply with the Americans with Disabilities Act (ADA) in all respects. If, as an
attendee or a participant at this meeting, or in meetings on a regular basis, you
will need special assistance beyond what is normally provided, the City will
attempt to accommodate you in every reasonable manner. Please contact the
Office of the City Clerk, (760) 346-0611, at least 48 hours prior to the meeting to
inform us of your needs and to determine if accommodation is feasible.
AFFIDAVIT OF POSTING
I, Níamh M. Ortega, Assistant City Clerk of the City of Palm Desert, do hereby
certify, under penalty of perjury under the laws of the State of California, that the
foregoing agenda for the Palm Desert City Council, Successor Agency for the
Palm Desert Redevelopment Agency, and Housing Authority, was posted on the
City Hall bulletin board and City website www.palmdesert.gov no less than 72
hours prior to the meeting.
/S/ Níamh M. Ortega
Assistant City Clerk
City Council Study Session
Page 3 of 30
Page 4 of 29
Page 1 of 1
CITY OF PALM DESERT
STAFF REPORT
MEETING DATE: April 11, 2024
PREPARED BY: Carlos Flores, AICP, Principal Planner
REQUEST: STUDY SESSION: UPDATED MILLS ACT ELIGIBLE SCOPES OF WORK
RECOMMENDATION:
Provide feedback on proposed changes to the Mills Act Contract Guidelines.
BACKGROUND/ANALYSIS:
Mills Act contracts require a 10-year work plan indicating how the tax savings will be reinvested
into the rehabilitation, restoration, and/or ongoing maintenance of the property. The purpose of
this study session is to provide an overview of proposed changes to Appendix A of the Guidelines
pertaining to eligible scope of work criteria that are a component of the Mills Act Contracts.
Appendix A categorizes proposed improvements as either contributing to “structure integrity”,
“architectural/historical integrity,” or ineligible.
Legal Review:
This report has been reviewed by the City Attorney’s office.
Cultural Resources Preservation Committee (CRPC)
At its regular meeting on January 24, 2024, the CRPC recommended approval of the draft
Guidelines revisions, with the condition that staff amend to make the repair or new construction
of walls or fences eligible under Architectural and/or Historical integrity.
ATTACHMENTS:
1. Presentation
Page 5 of 29
Page 6 of 29
Mills Act
Background & Criteria
CITY COUNCIL
APRIL 11, 2024
4/11/2024 CITY COUNCIL STUDY SESSION 1
Page 7 of 29
Mills Act - Background
Legislation enacted in 1972 - Authority for Local governments to enter contracts with owners of
qualified historic properties who actively participate in the restoration and maintenance of
their historic properties according to the US Secretary of Interior Historic Standards, in
exchange for receiving property tax relief.
Each local government establishes their own criteria and determines how many contracts they
will allow in their jurisdiction.
Involved Agencies: City of Palm Desert, CA Board of Equalization, Riverside County Tax
Assessors Office
Framework established in:
California Government Code, Article 12, Sections 50280 - 50290
California Revenue and Taxation Code, Article 1.9, Sections 439 – 439.4
24/11/2024 CITY COUNCIL STUDY SESSION
Page 8 of 29
Mills Act – How does it work
4/11/2024 CITY COUNCIL STUDY SESSION 3
Mills Act assess using the
Income Approach to Value
vs. Market Approach to
Value
For owner-occupied
properties, the "income" is
determined based on
comparable rents for
similar properties in the
area.
For income-producing
properties, the income
amount is based on actual
rent received and typical
rents for similar properties
with similar uses.
Page 9 of 29
Mills Act – Hypothetical Example
44/11/2024 CITY COUNCIL STUDY SESSION
Single Family Home Assessed Value: $500,000 Taxes: $5,000 (1.0%)
Gross Income $48,000 ($4,000 * 12 mo.)
Less Expenses $5,000 (insurance, repairs, utilities)
Net Income $43,000 ($48,000 - $5,000)
Capitalization Rate
(Riverside County Assessor)
13.55%Interest component at 4.25%
Historic property risk component at 4%
Amortization component at 4.3%
Property tax component at 1.0%
New Valuation $317,344 ($43,000 / 0.1355)
New Taxes $3,174 ($317,344 * 0.01)
Annual Tax Reduction $1,826 (37%)($5,000 - $3,174)
Page 10 of 29
Contract – 10-YR Rehabilitation/Restoration Plan
Mills Act contracts require a 10-year work plan indicating how the tax savings will
be reinvested into the rehabilitation, restoration, and/or ongoing maintenance of
the property.
The intent is to:
Preserves life of the historic features of the property
Corrects any critical systems or structural deficiencies
Reverses inappropriate alterations
All work must meet the Secretary of the Interiors Standards for Rehabilitation
There is no requirement that the cost of the rehab/restoration and maintenance equal
the amount of tax savings.
54/11/2024 CITY COUNCIL STUDY SESSION
Page 11 of 29
Contract Compliance
Under the state legislation enabling Mills Act Contracts, the City is
required to conduct an in-person inspection once every five years
to ensure that the property is being properly maintained (or
restored) in accordance with the Mills Act program.
As part of the annual self-reporting, the property owner will be
asked to submit the following to staff:
Copies of invoices and receipts for all work completed
(materials, labor, etc.);
A list of any additional work completed on the property since
initiation of the contract, that may not have been included on
the Rehabilitation Plan;
An updated Rehabilitation Plan indicating items completed with
dates to indicate if completion is ahead or behind schedule;
Photographic documentation of any completed or in-progress
work.
64/11/2024 CITY COUNCIL STUDY SESSION
Page 12 of 29
Contract – 10-YR Rehabilitation/Restoration Plan
Eligible Improvements & Maintenance Items
•Eligible work currently includes “any necessary repair,
maintenance, restoration, or rehabilitation of a Historic
property”
•Previously approved Plans have included:
◦New appliances (washer & Dryer, refrigerator)
◦Drapes and curtains
◦HOA fees
74/11/2024 CITY COUNCIL STUDY SESSION
Riverside County Appraiser
Interior items such as drapes,
appliances, paint,etc don’t
significantly impact valuation.
Valuation only impacted if it’s
more of a construction level
project. If it’s interior, it can’t be
items that are easily replaced
Page 13 of 29
Consideration – Eligible Improvements
1.Staff seeking Council’s input on updating Appendix A of Guidelines to have clearer
eligible improvements in the work plan
•CRPC recommended approval of the updated guidelines on January 24, 2024
•Updated Appendix A categorizes improvements as either contributing to “Structure Integrity”,
“Architectural/Historical Integrity” or Ineligible
•Additional input received at the March CPRC meeting from an existing property owner/Mills Contract
that there should be no changes - primarily interior improvements
84/11/2024 CITY COUNCIL STUDY SESSION
Page 14 of 29
Appendix A
9
SCOPE OF WORK ELIGIBLE INELIGIBLE
Structure Integrity Architectural and/or
Historical Integrity
Interior
1.New/repair appliances X
1.New/repair carpet X
1.New/repair countertops X
1.New/repair flooring X
1.Interior painting X
1.Changes to interior walls X
1.Carpentry restoration work (example:
Windows, molding, framing)X
Roofing
1.Patch/Repair Roof X
1.New Roof (different material)X
1.New roof (original material)X X
1.Altering Building Roof (ridge, dormers, gables,
etc.)X
1.Repair roof framing X
1.Repair of eaves/overhangs X
1.Flashing/waterproofing X
1.Install rooftop photovoltaic system (Solar
panels)X
Windows/Doors/Awning/Shutters
1.Replace exterior doors and/or windows X
1.Alteration/creation of window or door opening X
1.Replacement/repair of shutters or awnings X
1.Install or remove shutters or awnings X
SCOPE OF WORK ELIGIBLE INELIGIBLE
Structure
Integrity
Architectural and/or
Historical Integrity
1.Whole house exterior painting X
1.Touch up paint X
1.Re-stucco (like for like)X
1.Stucco repair (like for like)X
1.Repair, restore, or repaint masonry X
1.Cleaning of walls X
1.New/replacement wall cladding X
Architectural Elements
1.Repair, remove, or alter existing patios,
balconies, and/or chimneys X
1.Construct new patio, balcony, and/or
chimney X
1.Construct new attached wall X
1.Repair or replace gutters and downspouts X
1.Repair existing architectural element X
1.Add new architectural element X
Mechanical
1.New HVAC system(s)X
1.New venting or duct work X
1.New water heater X
1.New fans X
1.HVAC system maintenance/repair X
Electrical
1.New electrical outlets, circuits, panels X
1.Whole house rewiring X
1.Electrical panel upgrade X
1.New service lines to detached structure X
1.Electric vehicle charger X
1.Battery storage or generator X
1.Security lighting and/or alarm system X
1.Exterior lighting fixtures X
1.Interior lighting fixtures X
4/11/2024 CITY COUNCIL STUDY SESSION
Page 15 of 29
10
SCOPE OF WORK INELIGIBLE
Structure
Integrity
Architectural and/or
Historical Integrity
1.Whole house repiping X
1.New plumbing fixtures (sink, tub, shower,
faucets)X
1.Plumbing repairs X
1.New service or supply lines X
Fire Protection
1.Install fire sprinkler system X
1.Install smoke/CO2 alarms X
Structural/Foundation
1.Foundation bolting, wall bracing, and
related seismic work
X1.New/repair foundation
1.Seismic retrofitting
1.Repair or reinforce wall/ceiling framing or
bracing
Drainage/Water Protection
1.Flashing
X
1.New/repair Exterior Drains
1.Water damage repair (interior/exterior)
1.Re-grading of property for drainage
purposes
SCOPE OF WORK INELIGIBLE
Structure
Integrity
Architectural and/or
Historical Integrity
Accessory Structures
1.New/repair of walls or fences X
1.Landscaping and hardscape X
1.ADU or JADU construction X
1.Install/remove/repair swimming pool X
1.Construct/repair/removal of original
accessory structure X
1.Construct/repair/removal of non-original
accessory structure X
General Maintenance
1.HOA Fees X
1.Regular common area or landscaping fees X
1.Termite Treatment
X
1.Mold remediation
1.Abestos remediation
1.Radon gas prevention/remediation
1.Lead-based paint removal
4/11/2024 CITY COUNCIL STUDY SESSION
Page 16 of 29
Consideration – Value of Improvements
2.Whether the cost of the rehab/restoration and maintenance improvements
proposed as part of the 10-year Plan should at a minimum equal the amount
of annual tax savings for all new 10-year Contacts and renewals of 10-year
Contracts.
114/11/2024 CITY COUNCIL STUDY SESSION
Page 17 of 29
Next Steps
4/11/2024
Based on input received, Staff will prepare an action
item for City Council consideration on April 25th
CITY COUNCIL STUDY SESSION 12
Page 18 of 29
Page 1 of 1
CITY OF PALM DESERT
STAFF REPORT
MEETING DATE: April 11, 2024
PREPARED BY: Richard D. Cannone, AICP, Development Services Director
REQUEST: STUDY SESSION: UPDATE ON DINING DECK PROGRAM
BACKGROUND/ANALYSIS:
The purpose of this study session is to provide an update and seek Council input and feedback
on the dining deck program based on City Council direction from the November 16, 2023 meeting
that includes the creation of a new fee for the use of the right of way based on square footage.
Legal Review:
This report has been reviewed by the City Attorney’s office.
ATTACHMENT:
1. Presentation
Page 19 of 29
Page 20 of 29
DINING DECK UPDATE
STUDY SESSION
CITY COUNCIL
JANUARY 11, 2024
Page 21 of 29
Background: City Council Direction (11/16/2024)
Updated Temporary Outdoor Dining Deck Design Guidelines
Went into effect January 1, 2024
Focus on Dining Decks within street, not sidewalk cafes
Extended Temporary Outdoor Dining Deck Program to June 30, 2026
New Temporary Use Permit (TUP), Guidelines, & Revocable License to be effective July 1, 2024
Annual application thereafter
Directed staff to research an annual fee based on a square feet and return at a future
meeting
No longer part of an emergency order
Level of fairness
04/11/2024 CITY COUNCIL STUDY SESSION 2
Page 22 of 29
Existing Dining Decks w/in ROW – 8 TUPs
Location/Restaurant Approx SF
El Paseo (7)
Armando's Bar and Grill 889 SF
Daily Grill 254 SF
Kitchen 86 635 SF
Mamma Gina 554 SF
Piero's PizzaVino 318 SF
Sweet Basil 597 SF
The Fix 856 SF
HWY 111 Frontage Roads (1)
Little Bar 428 SF
04/11/2024 CITY COUNCIL STUDY SESSION 3
Page 23 of 29
Update/Considerations – Within El Paseo
Dining Decks located within El Paseo – 7 Temporary Use Permits (TUP)
o TUPs expire June 30th
o New TUP application/guidelines required
El Paseo paving project starting June/July to October 2024
o Dining Decks must be removed no later than June 30th
Week of April 15th - Staff will be delivering a notice the to TUP holders
informing them that dining decks must be removed for the paving project &
steps to needed to apply under the new TUP guidelines.
o New Dining Decks may be placed within ROW October/November 2024
El Paseo Merchants Association - Staff attending the April 18th meeting to
provide update and answer questions.
04/11/2024 CITY COUNCIL STUDY SESSION 4
Page 24 of 29
Exclusive Use Fee Methodology
Area Avg Asking Rate SF/YR*Avg Market Rate SF/YR*
El Paseo (Portola to Hwy 74)$ 39.65 SF $ 34.82 SF
San Pablo (Roundabout to Hwy 111)-$ 23.50 SF
Highway 111 Frontage Roads (Portola to
Monterey)
$ 28.73 SF $ 26.62 SF
Blended Avg Market Rate $ 28.31 SF
04/11/2024 CITY COUNCIL STUDY SESSION 5
*Source: CoStar
Page 25 of 29
Consideration/Options – Market Rate Annual Fee
Location/Restaurant Approx SF Annual Fee Annual Fee
Blended Avg
Annual Fee
50% Reduction*
El Paseo $ 34.82 SF/YR $ 28.31 SF/YR $ 17.41 SF/YR
Armando's Bar and Grill 889 SF $ 30,955 $ 25,168 $ 15,922
Daily Grill 254 SF $ 8,844 $ 7,191 $ 4,422
Kitchen 86 635 SF $ 22,111 $ 17,977 $ 11,055
Mamma Gina 554 SF $ 19,290 $ 15,684 $ 9,654
Piero's PizzaVino 318 SF $ 11,073 $ 9,003 $ 5,536
Sweet Basil 597 SF $ 20,788 $ 16,901 $ 10,394
The Fix 856 SF $ 29,806 $ 24,233 $ 14,903
HWY 111 Frontage Road $ 26.62 SF/YR $ 28.31 SF/YR $ 13.31 SF/YR
Little Bar 428 SF $ 11,393 $ 12,177 $ 5,697
*Reduction based on seasonal peak
04/11/2024 CITY COUNCIL STUDY SESSION 6
Page 26 of 29
Consideration/Options – Max Size of Area
Under current guidelines, no maximum size established. Three options to
consider:
1.Up to 2 parking spaces or 352 SF [(8’x22’)x2]
2.Limited to Frontage of Business
Option to encroach into ½ of frontage of one neighboring business
with their approval.
3.No limitation
04/11/2024 CITY COUNCIL STUDY SESSION 7
Page 27 of 29
Update:
Dining Decks
w/in On-Site
Private Parking
Lots
04/11/2024
After June 30, 2024, must be permitted through a
Conditional Use Permit
◦One application under review (Wildest Restaurant)
CITY COUNCIL STUDY SESSION 8
Page 28 of 29
Staff Recommendation
Exclusive Use License Fee:
Effective July 1, 2024, and prior to issuance of the TUP
Applicant pay an annual fee based on the Blended Market Rate of $28.31 SF
04/11/2024 CITY COUNCIL STUDY SESSION 9
Maximum Size of Dining Deck:
Limited to the Business Frontage
Option to encroach into ½ of frontage of one neighboring business with their
approval
Page 29 of 29