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HomeMy WebLinkAbout1997-08-28MINUTES — REGULAR PALM DESERT REDEVELOPMENT AGENCY MEETING THURSDAY, AUGUST 28, 1997 CIVIC CENTER COUNCIL CHAMBER * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * I. CALL TO ORDER Chairman Kelly convened the meeting at 4:00 p.m. H. PLEDGE OF ALLEGIANCE - Member Robert A. Spiegel III. INVOCATION - Chairman Richard S. Kelly IV. ROLL CALL Present; — Vice Chairman Jean M. Benson Member Buford A. Crites Member Walter H. Snyder Member Robert A. Spiegel Chairman Richard S. Kelly Also Present: Carlos L. Ortega, Executive Director Ramon A. Diaz, City Manager David J. Erwin, City Attorney Sheila R. Gilligan, Agency Secretary Richard J. Folkers, ACM/Director of Public Works John Wohlmuth, ACM/Director of Administrative Services Pat Conlon, Director of Building and Safety Phil Drell, Director of Community Development Paul Gibson, Finance Director/City Treasurer John Nagus, Community Arts Manager Paul Shillcock, Economic Development Manager Mary P. Gates, Deputy City Clerk MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * V. ORAL COMMUNICATIONS None VI. CONSENT CALENDAR A. MINUTES of the Adjourned Meeting of the Redevelopment Agency of August 7, 1997, and the Regular Meetings of July 10, July 24, and August 14, 1997. Rec: Approve as presented. B. CLAIMS AND DEMANDS AGAINST THE AGENCY TREASURY - Warrant Nos. 1RDA, 2RDA, 3RDA, 4RDA, 5RDA, 6RDA, 7RDA, 8RDA, 9RDA, 10RDA, 11RDA, 12RDA, 1DR, 2DR, 3DR, 6DR, 7DR, 8DR, 9DR, 10DR, 11DR, and 12DR. Rec: Approve as presented. C. INVESTMENT PORTFOLIO SUMMARY as of June 30, 1997. Rec: Receive and file. D. MINUTES of Housing Advisory Committee Meetings of May 14 and June 11, 1997. Rec: Receive and file. E. MINUTES of Economic Development Advisory Committee Meetings of May 15 and June 19, 1997. Rec: Receive and file. F. REQUEST FOR AUTHORIZATION to Advertise and Call for Bids for the Rehabilitation of 73-625 Santa Rosa Way, Santa Rosa Apartments (Contract No. R1332Q). Rec: By Minute Motion, authorize the City Clerk to advertise and call for bids for the rehabilitation of the Santa Rosa Apartments located at 73-625 Santa Rosa Way. 2 M NUTS PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * G. REQUEST FOR RATIFICATION of Miscellaneous Design Service Contracts for Desert Willow Golf Course Project. Rec: By Minute Motion, ratify the following (under $5,000) contracts for miscellaneous design services on the Desert Willow Golf Course project: 1) Dream Engineering (Palm Desert) for electrical engineering services in the amount of $2,300.00; 2) Jon Tandy (Yucca Valley) for weld inspection services in the amount of $1,200.00; 3) Pearson & Associates (Palm Desert) for architectural design services in the amount of $4,990.00. H. REQUEST FOR APPROVAL of Engineering Services for Highway 111 and El Paseo Proposal (Contract No. R13330). Rec: By Minute Motion, approve the engineering services to be provided by Robert Bein, William Frost & Associates for the development of the parking lot in the northeast area of El Paseo and Highway 111 and appropriate $32,200.00 for such services. I. REQUEST FOR CONSIDERATION of Extension of Contract for Services with the Desert Community College District Auxiliary (Contract No. R10342). J. Rec: This matter was held for separate discussion under Section VII, Consent Items Held Over. See that portion of the Minutes for discussion and action. REQUEST FOR APPROVAL of Cancellation of Exclusive Negotiating Right with F&M Associates (Contract No. R12970) Rec: By Minute Motion, cancel the Exclusive Negotiating Right with F&M Associates for the proposed entertainment center at Palms to Pines East. K. REQUEST FOR APPROVAL of Change Order No. 1 to Contract No. R10900 (Pearson & Associates) for Additional Architectural Programming Services on the Desert Willow Project. Rec: By Minute Motion, approve Change Order No. 1 to Contract No. R10900 (Pearson & Associates) for additional architectural programming services in the amount not to exceed $5,000.00 plus $1,200.00 for reimbursables and authorize the transfer of funds from Account No. 851-4663-454-4001 to the contract base account. 3 MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * L. REQUEST FOR APPROVAL of Change Order No. 1 to Contract No. R10960 (Nuevo Engineering) for Additional Construction Services on the Tournament Course at the Desert Willow Project. Rec: By .Minute Motion: 1) Approve Change Order No. 1 to Contract No. R10960 for additional construction services in the amount of $5,050.00; 2) authorize the transfer of funds from the contract's contingency to the base in the amount of $2,345.00; and 3) appropriate an additional $2,705.00 from project Account No. 851-4663-454- 4001. M. REQUEST FOR ACCEPTANCE OF WORK for Contract No. R10960, Construction Prewatering of North Course of Desert Willow Project. Rec: By Minute Motion, authorize the City Clerk to file a Notice of Completion for Contract No. R10960. Member Spiegel asked that Item I be removed for separate discussion under Section VII, Consent Items Held Over, of the Agenda. Upon motion by Spiegel, second by Benson, the Consent Calendar, with the exception of Item I, was approved as presented by unanimous vote of the Agency Board. VII. CONSENT ITEMS HELD OVER I. REQUEST FOR CONSIDERATION of Extension of Contract for Services with the Desert Community College District Auxiliary (Contract No. R10342) Member Spiegel stated that it appeared there was an overlap between the Redevelopment Agency and the City's Business Support Center. He asked whether the Business Support Center had been made aware of this item and whether the Agency should continue to spend $50,000 for some things that are being done by the Business Support Center. Mr. Shillcock stated that the scope of services proposed is based on items in the work program, an Agenda item which was later in this meeting. He said it had been reviewed by the City Manager and Director of Community Development who felt there was no overlap in services. Member Spiegel suggested that this matter be held until further in the Agenda when the work program is considered, and then both items could be voted on at the same time. After further discussion under New Business Item D, Member Crites moved to continue this matter to the meeting of September 11, 1997. Motion was seconded by Benson and carried by unanimous vote. 4 MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * RESOLUTIONS None IX. NEW BUSINESS A. REQUEST FOR CONSIDERATION OF RESALE OF LOT 38 AND LOT 133 - DESERT ROSE. Mr. Ortega noted the report in the packets and stated that Ms. LaRocca was available to answer any questions. Member Spiegel stated that he had commented to Ms. LaRocca that he felt she was doing an outstanding job in sales of the Desert Rose homes. He said he would like to go on record that the Agency Board is very proud of what has been accomplished at that project. Member Spiegel moved to, by Minute Motion, determine that the Agency will not exercise its option to purchase Lot 38 and ratify an action not exercising the option to purchase Lot 133 at Desert Rose. Motion was seconded by Crites and carried by unanimous vote. B. REQUEST FOR AWARD OF CONTRACT FOR CONSTRUCTION OF THE PERIMEThR LANDSCAPE AND SIDEWALK AT THE NORTH COURSE OF THE DESERT WILLOW PROJECT SITE (Contract No. R12780). Mr. Ortega reviewed the staff report, noting that this matter had been before the Desert Willow Committee which recommended the scope of work. Member Spiegel asked if the price for the sidewalk would remain the same if the City were to become a Charter City as a result of the November election. Mr. Ortega responded that a legal analysis had been done by Agency Counsel and that this particular project would not be affected because it has already gone out to bid. He added that this project was bid under the Agency and would be paid for by the Agency and that the Charter City issue would not make a difference to this project cost. Member Crites noted that what staff had provided to him an hour ago indicated that whether the City becomes a Charter City or not, the Agency would still have to pay prevailing wage. Mr. Ortega agreed and said that if the City becomes a Charter City and chooses not to pay prevailing wage, that may not excuse the Redevelopment Agency from paying prevailing wage. 5 1bIINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Member Spiegel noted that the last sentence indicated that we might be able to get around paying prevailing wage. He said it was also his understanding that this was being looked at in Sacramento. Mr. Ortega stated that the prevailing wage issue in Sacramento seemed to be an issue that has come up every year for the past five years. He said as far as staff was aware, the Legislature had not been successful in getting that passed through. Chairman Kelly stated he felt the Agency should move ahead with this project. Member Spiegel disagreed and said he did not feel this particular sidewalk would be used by many people for quite a while. Chairman Kelly stated that this was landscaping also, not just the sidewalk. He said a lot of money had been spent on the artistic wall and the golf course, and he felt it would be wrong to wait on the landscaping and sidewalk project. He added that there was just as good a chance that it will cost more rather than less if we wait. Member Crites questioned the last paragraph in the memorandum from Agency Counsel Bill Strausz that under certain circumstances the Agency can avoid paying prevailing wage. He said if the Agency has to pay prevailing wages anyway, it is a useless issue to discuss waiting on this project. However, on this sidewalk, he asked if the Agency could use the last paragraph in the memorandum in some way in which prevailing wages would no longer apply. Mr. Erwin noted that the Health and Safety Code indicates if it is a Redevelopment Agency project, it is a prevailing wage project. On the other hand, were it a City project that was initiated and bid by the City with some financial assistance from the Agency, there is a way to accomplish it. He said the assumption is that the City is a Charter City and that we have adopted the appropriate ordinances to eliminate the prevailing wage requirement. Member Crites asked whether that would apply to this golf course, this sidewalk, and the way in which it was put together. Mr. Erwin responded that he did not know because he had not been involved in putting it together and the bid process, etc. He said his assumption was that it required prevailing wages in the bid. Member Crites stated that this had been a Redevelopment Agency project, and he asked if it was possible to make this a City project.. Mr. Erwin responded that it was possible to do that. 6 MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Chairman Kelly asked if that meant the City would then pay for it, and Mr. Erwin responded that this was correct. Member Crites asked if it was possible to change a Redevelopment Agency project into a City project, not pay prevailing wage, and then have the Agency reimburse the City for the total cost of the City project. Mr. Erwin responded that it was possible with some assumptions in that process such as passage of the Charter City issue at the election. Member Spiegel moved to continue this matter to the meeting of September 11, 1997, in order to get a more definitive answer. Motion was seconded by Crites and carried by unanimous vote. C. REQUEST FOR AWARD OF CONTRACT FOR STREET IMPROVEMENTS ON HOVLEY LANE EAST FROM OASIS CLUB DRIVE TO WASHINGTON STREET (Project 629-97, Contract No. R13010) Mr. Ortega reviewed the staff report, noting that this was one of the Project Area Four projects and that the Committee had recommended it as a priority. — Member Crites asked whether the same issues would apply to this project as the perimeter sidewalk project relative to prevailing wages. Mr. Ortega responded that the same issues could apply because this is a City project. Chairman Kelly stated he felt it was important to evaluate what the savings will be versus what will be lost. He said this is a public safety issue, and certain promises have been made to residents in the area. He said he felt this project should proceed at this time. Member Snyder agreed. Member Benson stated that if this project were held up, the City could explain to residents that it was being delayed in order to save money. Member Spiegel moved to, by Minute Motion: 1) Award Contract R13010 to Matich Corporation of Colton, California, for the street improvements on Hovley Lane East in the amount of $467, 652.00 plus a ten percent contingency in the amount of $46,765.20. Funds are available in Account No. 854-4675-433- 4001; 2) authorize the Chairman to execute the agreement. Motion was seconded by Snyder and carried by a 3-2 vote, with Members Benson and Crites voting NO. Member Crites explained that his no vote was made with notation that he would prefer continuance to see how much less expensive it would be if the City were to become a Charter City. 7 MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * D. REQUEST FOR CONSIDERATION OF ECONOMIC DEVELOPMENT WORK PROGRAM FOR FISCAL YEAR 1997/98. Mr. Shillcock reviewed the staff report and offered to answer any questions. Member Spiegel noted the "Cook Street Business Association Formation" and "Commercial Space Inventory" paragraphs in the staff report and said he felt there was a tremendous overlap between Economic Development and Business Support. He said there must be some meshing as far as who will be responsible for what and do we actually need the College to supply us with the information as far as empty retail spaces or if this could be taken over by Business Support. He said he had no problems with a good part of what the memorandum discussed such as the 22 hours per week on funded feasibility study and ten hours per week on funded fuel cell projects; however, he said he felt it would be appropriate before we approve the College that a meeting be held with the Business Support people to see how everything meshes together. Member Benson agreed. Member Crites moved to continue this matter to the meeting of September 11, 1997. Motion was seconded by Benson and carried by unanimous vote. E. REQUEST FOR APPROPRIATION OF FUNDS TO SUPPORT CONTRACT NO. R10730 (SCAQMD) FOR FISCAL YEAR 1997/98. Mr. Ortega reviewed the staff report and offered to answer any questions. Member Crites moved to, by Minute Motion, approve the following: 1) Appropriation of $200,000.00 from the Agency's Unobligated Funds (Bond Funds) for Fiscal Year 1997/98; 2) authorization to spend the funds per the obligations contained in Contract No. R10730. Motion was seconded by Spiegel and carried by unanimous vote. 8 MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * F. REQUEST FOR AWARD OF CONTRACT FOR CONSTRUCTION OF THE RESORT COURSE (BID PACKAGE SC -A) AT THE DESERT WILLOW PROJECT SITE (Contract No. K12790). The following is a verbatim transcript of this portion of the Minutes: KcX RSK Richard S. Kelly, Chairman CLO Carlos L. Ortega, RDA Executive Director RAS Robert A. Spiegel, Agency Board Member RA Rudy Acosta, Project Manager BAC Buford A. Crites, Agency Board Member JMB Jean M. Benson, Vice Chairman WHS Walter H. Snyder, Agency Board Member SRG Sheila R. Gilligan, Agency Secretary RSK Next item is a request for award of a contract for construction of the Resort Course. — CLO Mr. Chairman, once again, you do have a report before you. You do have the results of bids that were received. If you have any questions, Rudy is here to answer those. RAS I guess my question is the same as the one that I had earlier. RA Regarding the prevailing wage rates? BAC Yes, but we don't have an answer to it from Dave. CLO Let's make the assumption that in fact the Council does proceed to become a Charter City and does adopt the appropriate ordinances. You would not be doing that until some time after the year. In terms of the schedule and our commitment to deliver the second golf course, our recommendation would not be feasible, but you can take action as you wish. RAS Do we have any idea of the dollars that we could save? RA Yes, sir. In anticipation of the question and the request, about a week ago I completed a report that did a comparison with respect to the maintenance facility (that is an ongoing project), the clubhouse (that is an anticipated project), and the currently... _ CLO Rudy, would you like me to pass a copy because... RA Yes. 9 MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BAC I think I'm the only person...I don't think: everyone has this document. RA It would be easier to follow along. Starting with the maintenance facility, because that was the easiest one to approach because that is a current ongoing project, what I did was I asked the contractor of.record, James E. Simon Company, to go back and look at their line item bid for the maintenance facility and give me percentage of what would be projected savings on this project had we bid it out with nonprevailing wage rate. The project budget, as you know, is a million dollar budget. Of that, 40% of it is attributed to labor. The reason why labor is important is because that's the only place where prevailing wage rate affects. It does not affect materials. Of that, we took 40% of that for $400,000, and then he appropriate a savings of approximately 15% to that, so we would have had the opportunity to realize an approximately $60,000 savings on the million dollars we're spending on the maintenance facility today. So I took that same figure and applied it to the $5 million projection for the golf clubhouse, and we're looking at what amounts to somewhere in the neighborhood of $270,000. Then, in going on to the golf course, what I did was looking at the current bid analysis that we had received from Park West, who is the apparent low bidder, I had them go back and apply an appropriate percentage of savings to each and every line item. It's a 30-page, 46-schedule line item for every nut and bolt that goes into the golf course. He came up with appropriate percentages, and then I did the arithmetic, banged it out. The result of it, long story short, is that the savings were somewhere around the five and a half percent. Now when applied to a $12.5 million project, it's a significant amount of money. However, we looked at this project from the standpoint of how does it affect the current timelines that we have projected, and that's where, starting on page two and page three of this report, it outlines some mitigating factors that would more than offset the savings that we may realize of $670,000 on this golf course. Item one is that we are currently under an ideal construction scenario in terms of grassing windows, it allows us to coordinate with the development of IROC, it allows us any delays due to weather. We do have a potential El Nino condition that may cause us some delays in the process. Those are all speculative, but those are all things that we've put into a schedule to help us achieve a drop dead completion date. Probably most significant and important would be item two, is that taking into account that the Agency Board or the City Council would have to adopt a resolution to, I guess, to waive the prevailing wage rate requirements, I would then be backed up into a start date of somewhere in January/February, which makes it next to impossible to deliver a golf course by November 1 without coming back to you for an additional request of $1 million or $1.2 million for sodding. The other thing is that this schedule that we're on allows us to, if we deliver this course by November 1, it allows us to take advantage of potential revenues that we could earn for the months of November and December. Those are considered shoulder seasons, but they are significant amounts that we could gain on those two months. Likewise, because the schedule would allow us to possibly bring it in even before November, we would not have to shut down the entire facility for the month of October. We could do an alternate and still take advantage of October revenues, where single -course developments lose October. At Desert Willow, we would have that opportunity to gain that revenue. We also have to consider the fact that this current schedule takes into account all the consultants that we have on line today. A three to four month delay 10 MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * would justify them coming back for time extensions, so that's a cost that I can't apply to it at this time because I don't know that for sure. But that is a potential cost as well. Another real important thing is that the golf industry is picking up. It's getting very busy. We have The Canyons at Big Horn, Shadow Rock, The Reserve. Those are all projects that are getting ready to get started, and when the industry is busy, we don't get the good prices that we get when they're not busy. That was apparently so in the north course, and it's still apparent for this resort course as well. So I would not be sitting here guaranteeing you that we could hold these prices after January 1 should we rebid the project. Also, we do have an agreement with Intrawest to deliver a playable golf course by November 1, and that deadline is also significant by the fact that it does come with a $5 million payment on that, and that would effectively delay that payment and possible other payments that would come within that year. So we would potentially lose the interest that we could earn on that as well. Therefore, with those eight items, or seven items, listed in there, staff cannot recommend any further delay on the project if the Council wishes to go ahead with this project. I think that...I think it was a worthwhile exercise to go through, to do the cost comparison studies, but for this particular bid package, it doesn't seem to pan out any particular advantage to us to wait. RAS First of all, the maintenance facility, that's underway, is that correct? RA Yes, sir. RAS Okay, so that $60,000 that's just what you took a look at. RA Yes, sir. RAS We have not approved the golf clubhouse. RA No, sir, you haven't. RAS So, that $270,000 that comes in at the price that you say, we're going to be able to save, is that correct? RA We could, but I would probably ask you to read the body of the report because there are some factors there that could possibly more than offset the $270,000 savings. RAS Okay, but we haven't even gotten that yet. We don't even know... RSK But we have an opportunity to look at that later. RA Yes, you have that. It's in this report. RSK We have another opportunity to look at that. 11 111IINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * RA You have an opportunity to look at that before we approve the clubhouse. RAS So the only thing we're looking at right now is the contractor to build the golf course, is that correct? RA Yes, sir. RAS And you're recommending Park West Golf because they came in at the low bid. RA Yes, sir. RAS Are you familiar with the fact that Council received a letter from one of the subcontractors indicating that Park West was slow in paying their bills... RA Yes, I am. RAS ...and recommending to Council that we not take Park West Golf. RA Yes, sir. That was a subcontractor that was brought out to the site to provide about $1,700 worth of watering when we were experiencing some extreme wind conditions. Park West has delivered a letter to the Agency that indicated yes, they do admit they were late in payment on the first invoice. It had to do with the fact that he had faxed an invoice, not given them an original. So they went back and forth. Eventually he did pay it. The other payment that was in dispute was paid within a 45 day period. So he has been paid up. RAS Were there any other complaints from any other subcontractors against Park West? RA None that were not taken care of already through the normal process when we issued the release of retention. In fact, those who had are all listed as his subcontractors for this project as well. RSK They're so dissatisfied that they're staying with him again. RAS Okay. You answered my questions. Thanks. RA Yes, sir. RSK Other questions or comments? BAC We have a date of delivery on this golf course of what date? RA November 1, 1998. 12 MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * — BAC November 1. RA Yes, sir. BAC And if not, as you say, IROC forfeits a year of payment, which is how much? RA $5 million? I believe Carlos knows the figures. CLO There are two or three instances in which payments get delayed to us, and those substantial payments would well exceed, I think, the savings... BAC How much? CLO We could calculate those. I could bring those to you. BAC Can you give me a close, I mean... RSK Take a wild guess. BAC You're listing it as a reason to not delay, so tell me what it is. CLO Well, number one is absent no financial ramifications except a default on our part, we would not deliver them the pads for their building, okay, so that would be an automatic default, they could pull out of the deal. In addition, there are payments that are to be made on a yearly basis. Those payments would be delayed every year. When you calculate the compound effect that that would have, top of the head, it would well exceed a million dollars as a penalty for us, so if the savings by waiting, assuming there was not a default issue, if we could say we're going to save a couple million, $2 million, I would say certainly it's worth looking at it and maybe even going back to IROC and say what about this, what about that. I think what we're saying is at this date we would not recommend that we delay it because of the ramifications, both contractual and financial. JMB CLO JMB CLO What are the ramifications if IROC defaults? We had to change the schedule once before for them. What if they ask for the schedule to be changed again? But all of those changes were made prior to executing the final agreement. Now that the agreement is executed, if IROC defaults we have $3.5 million on deposit. I didn't say default. I mean, if they would ask for a delay, it's not on schedule, or they want two or three extra weeks the same as... You cannegotiate anything in a contract, and I suppose that if the Council gave us that direction that we renegotiate the schedule, that's what we would do. 13 MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * JMB Well, I would just reiterate again. I think we should wait until after to see. I think we're trying to convince the public to be a charter city and the money we're going to save and award the biggest contract before they vote looks to me like we're not doing justice by trying to get them to vote for a charter city. RSK Well, the problem is that we're going to have lots of projects in the future, and there are lots of items in here that are going to cost us money, not...it has nothing to do with prevailing wage, it has to do with scheduling and it has to do with revenues we have an opportunity to bring in. We can keep a golf course open there 365 days a year, that's $5,000 a day at least right there, more than that probably in that time of the season. But...so we have a golf course open continually next year if we keep the schedule we have here. So all that revenue that we have coming in looks to me like lots of advantages to moving ahead, so from a business standpoint if I go and look through this whole thing, it seems to me that we need to move ahead on it. JMB But we have a golf course out there that's not used... RSK But we have to close it to seed it in October if we don't have another one available. I guess I should explain that in more detail. We have to close this October, so we have no golf course, we lose all that revenue, we still have the people there and the expense. Next year if we have a golf course coming in on line in November, we can leave our golf course open until November the first and then as that golf course opens up, we can close the one we have to reseed which we need to do for a month. So we gain a month's revenue on our golf course if we move ahead with this schedule. It has nothing to do with prevailing wages. JMB Well, I don't think... RAS Mr. Mayor, could I make a comment? If we go by what you suggested, Rudy, and I normally do, if you take a look at page two, we're going to have to sod the thing if we don't do it now, is that correct? RA First off the bat, yes, I would come back with the change order to sod. RAS And if we do sod, it's going to run between $600,000 and $1 million, right? RA That's right. RAS And if we wait for charter city, the most we're going to save is $670,000, right? RA And that's optimistic because if we... RAS Okay, but anyway, optimistic that's $670,000. So you're saying it's going to cost us $600,000 if we wait, and we're able to save the $670,000. 14 MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Yes. RAS So it's kind of...it's a push based on what you're telling me. The City really isn't going to save anything if we wait to see if we're a charter city. RA That's right. RAS And with that information, I move to approve. BAC I have a question, if I may, sir. If we approve today, what's your schedule for completion? RA My schedule for completion is that I should have grow -in by July of 1998. BAC So, golf balls bouncing around? RA Well, it depends on how well everything grows in. That's for the golf course. But there is also the entry road improvements that we have to... BAC When are you looking at having golf balls hit by real people paying money? — RA Drop dead date is in October. BAC Okay. How much down time does that assume this winter? RA I've probably got about only three weeks fudge in there. BAC Just as a side note and don't...who knows what you're going to predict and everything else, but I just have to...if you watch the local newspapers and last night half of ABC evening news and...we may have the driest winter on record. But everybody who's predicting winters is telling us that we need to get Ken Weller alive and on the issue of buying sand bags and everything else. RSK Palm Valley Storm Drain is not going to be dry this year? BAC There is a suggestion that you would be unwise to camp in it...to approximately 400% of normal rain. If that's true, you may have some problems on scheduling. RA That's correct. BAC And, again, that may not, we may not have a drop of water all winter, but every meteorological straw in the wind suggests that we may have an interesting time. 15 MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * RAS I'm surprised, Councilman Crites, that you do not read the Farmers Almanac. If you were to read the Farmers Almanac you would find out that it's supposed to be a very dry winter. BAC I stand corrected as do most other people. RSK We don't have all that spare time down in San Diego. We've been back here working. CLO If we were delayed in our schedule due to inclement weather, and our contracts include that provision, inclement weather, wars, or strikes, like that, that is an excuse for delays. BAC An act of God. RSK It doesn't get there where we're going. CLO They would not penalize us, but I think delaying it would. WHS Mr. Mayor, I second the motion. RSK Any other discussion? Please vote. SRG The motion carries by a 4-1 vote, with Councilmember Benson voting NO. For purposes of clarifying the action taken by the Agency Board, Member Spiegel moved to, by Minute Motion, authorize the Chairman to enter into an agreement with Park West Golf, Inc., in the amount of $12,375,742.26 and authorize a ten percent contingency in the amount of $1,237,574.23 for the construction of the resort course at the "Desert Willow" project. Motion was seconded by Snyder and carried by a 4-1 vote, with Vice Chairman Benson voting NO. NOTE: THIS ITEM WAS LISTED ON AN AGENDA ADDENDUM POSTED 72 HOURS PRIOR TO THE MEETING. G. REQUEST FOR CONSIDERATION OF BUILDING HORIZONS PROPOSAL. Mr. Ortega stated that this item was related to a City item and suggested that the Agency Board perhaps bring up the City item at this time in order to have a better discussion. Ms. LaRocca reviewed the staff report, noting that staff had gone before the Planning Commission at its meeting of August 19 requesting approval of a lot split which was to be contributed to the Building Horizons proposal for construction of two single-family homes. The vote was to approve the split with the condition that each home be 2,000 square feet under roof. She said that given that condition and the implications that it could cause with regard to the stipulation for entry of judgment with the Wester Center, it would not be staff s recommendation to build two homes of 2,000 square feet. In lieu of that, staff had identified 16 MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * a single-family parcel on Buena Vista, currently owned by the Agency, which was properly zoned for construction of one single-family home. She said staff had advised Building Horizons that that site was available to them should they elect to go in that direction. Staff would also be recommending participation with the mortgage buy -down to a family of lower income and requested preparation of a disposition and development agreement. Staff also requested a zero interest loan of $75,000 to Building Horizons for the construction of that home and requested appropriation of funds. She offered to answer any questions. Member Crites stated that he assumed the reason for the lot split was that Building Horizons wanted to build two homes. Ms. LaRocca agreed. Member Crites asked what was being done to provide a location for a second home. Ms. LaRocca responded that Building Horizons was currently scouting the area for two possible sites and had advised her that they had located sites on Royal Palm. She said she had no information at this time relative to those sites but understood they were adjacent to one another. She said she did not know what the asking price was and whether there were any extenuating circumstances that would require Planning Commission approval. Member Crites asked what staff planned to do with the lot now owned by the Agency. Ms. LaRocca stated that it could be sold at some point in the future. Member Crites asked why staff did not recommend building two 2,000 square foot homes. Mr. Ortega noted that the settlement with the Western Center was a Closed Session items, and he stated that he would prefer discussion of the specifics to take place during Closed Session. Chairman Kelly suggested that this item be continued until after discussions in Closed Session. Member Crites asked whether three Building Horizons homes could be built. MR. STEVE JONES, 72-830 Ambrosia, spoke as a resident of Palm Desert and Board Member of Building Horizons. He said his organization had been doing some lot searching in the last several days and had found three parcels, each containing two contiguous lots, that would work with for the program. He said initial inquiries had been made but no negotiating at this point. Chairman Kelly asked if there was another lot that the Agency could move ahead on. Mr. Jones stated that it was important for the program to have lots that are contiguous, and there were three situations that had been found that would work. Member Crites asked if Mr. Jones was saying that he would rather not proceed with this one lot at this time. Mr. Jones responded that building only one home did not work for the program economically and that the overhead could not be supported with just one home. He agreed with Member Crites that he would rather not proceed with just the one lot. 17 MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 1997. Member Benson stated that since the Agency has supported this program from the very beginning, it would important to work with Building Horizons on the lots they have found since the Agency's lot will not work. She said if the Agency then has to sell its lot and put that money toward the other two lots for Building Horizons to purchase, that would be okay too. She said the Agency said it would give them a lot. If the lot does not work, the Agency should go forward and help them get two lots together so they can do the program. Member Crites moved to, by Minute Motion, continue this matter to the meeting of September 11, Mr. Jones stated that school would start on September 8th, and there are currently 18 students signed up for this program. Member Crites withdrew his motion and moved to, by Minute Motion, continue this matter to a date uncertain so that whenever the Agency has something to take action on, it will do so. Mr. Jones asked if the Agency Board could approve the program in concept. He said if the lots could be put together in the next week or two they would be able to move ahead without delay on their end. He said they had plans ready to go. Member Crites withdrew his motion and moved to, by Minute Motion, approve the program in concept without specific sites noted and direct staff to work with Building Horizons to come up with appropriate dollars. Motion was seconded by Benson and carried by unanimous vote. X. CONTINUED BUSINESS None XI. OLD BUSINESS None XII. REPORTS, REMARKS, AND AGENCY BOARD ITEMS REQUIRING ACTION A. EXECUTIVE DIRECTOR Mr. Ortega noted the Closed Session items listed on the Agenda. 18 MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * B. AGENCY COUNSEL Inquest for Closed Session: Conference with Legal Counsel regarding existing litigation pursuant to Government Code Section 54956.9(a): 1) Stull v. Bank of America NT & SA, et al, Superior Court of the State of California, City and County of San Francisco, Case No. 968-484 2) City of Palm Springs v. All Persons Interested in the Matter of the Redevelopment Plan for the Palm Desert Redevelopment Project Area No. 2, et al, Case No. Indio 51124 Conference with Legal Counsel - Anticipated Litigation pursuant to Government Code Section 54956.9: Significant exposure to litigation pursuant to subdivision (b): Number of potential cases: Conference with Real Property Negotiator pursuant to Government Code Section 54956.8: 1) Property: Vacant land Street Address: 73-075 Highway 111, Palm Desert, APN 627-191-004 Negotiating Parties: Agency: Carlos Ortega/Dave Yrigoyen Property Owner: Shell and Joyce Cohn Under negotiation: _x_ Price Terms of Payment 2) Property: 74-047 San Marino Circle, Palm Desert Negotiating Parties: Agency: Carlos Ortega Property Owner: Gary Tryon Under negotiation: L Price g Terms of Payment 3) Property: 74-039 San Marino Circle, Palm Desert Negotiating Parties: Agency: Carlos Ortega Property Owner: Ray Winner Under negotiation: Price Terms of Payment 19 MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 4) Property: Land located in Section 4 Negotiating Parties: Agency: Carlos Ortega/Dave Yrigoyen Property Owner: Palm Desert Redevelopment Agency Other party: United Properties Limited Under negotiation: Price .1 . Terms of Payment C. CHAIRMAN AND MEMBERS OF THE AGENCY None Upon motion by Spiegel, second by Crites, and unanimous vote of the Agency Board, Chairman Kelly recessed the meeting at 6:10 p.m. for dinner and Closed Session. He reconvened the meeting at 7:00 p. m. XIII. AWARDS, PRESENTATIONS, AND APPOINTMENTS None XIV. PUBLIC HEARINGS A. REQUEST FOR CONSIDERATION OF FIVE-YEAR IMPLEMENTATION PLAN OF THE PALM DESERT REDEVELOPMENT AGENCY ADOPTED BY SAID BODY IN DECEMBER OF 1994. Mr. Ortega noted the report in the packets and offered to answer any questions. Chairman Kelly declared the public hearing open and invited testimony in FAVOR of or OPPOSED to this plan. No testimony was offered, and he declared the public hearing closed. No Agency Board action required on this matter. XV. ORAL COMMUNICATIONS None 20 MINUTES PALM DESERT REDEVELOPMENT AGENCY MEETING AUGUST 28, 1997 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * XVI. ADJOURNMENT Upon motion by Spiegel, second by Crites, and unanimous vote of the Agency Board, Chairman Kelly adjourned the meeting at 8:50 p.m. ATTEST: SHEILA R. G AN, SE TARY TO THE PALM DESERT REDEVE'1MENT AGENCY 2 RIC 'A ' . KELLY, CHAIRMAN 21