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HomeMy WebLinkAbout2018-02-22MINUTES REGULAR MEETING OF THE BOARD OF DIRECTORS OF THE SUCCESSOR AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY THURSDAY, FEBRUARY 22, 2018 CIVIC CENTER COUNCIL CHAMBER 73510 FRED WARING DRIVE, PALM DESERT, CA 92260 I. CALL TO ORDER - 3:00 P.M. Chair Jonathan convened the meeting at 3:05 p.m. II. ROLL CALL Present: Director Jan C. Harnik Director Kathleen Kelly Director Gina Nestande Vice Chair Susan Marie Weber Chair Sabby Jonathan Also Present: Lauri Aylaian, Executive Director Robert W. Hargreaves, City Attorney Rachelle D. Klassen, Secretary Lori Carney, Director of Administrative Services Russell Grance, Director of Building & Safety Ryan Stendell, Director of Community Development Martin Alvarez, Director of Economic Development Janet M. Moore, Director of Finance/City Treasurer Tim Jonasson, Interim Director of Public Works Frankie Riddle, Director of Special Programs Stephen Y. Aryan, Risk Manager John Cortez, Battalion Chief, Palm Desert Fire/Riverside Co. Fire Dept./Cal Fire Lt. Matt Martello, Asst. Chief, Palm Desert Police/Riverside Co. Sheriff's Dept. Grace L. Rocha, Deputy City Clerk MINUTES SUCCESSOR AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY MEETING IV. RECONVENE REGULAR MEETING - 4:00 P.M. FEBRUARY 22, 2018 A. REPORT ON ACTION FROM CLOSED SESSION. None With Successor Agency Board concurrence, Chair Jonathan adjourned the meeting to Closed Session of the City Council at 3:06 p.m. He reconvened the meeting at 4:10 p.m. V. AWARDS, PRESENTATIONS, AND APPOINTMENTS None VI. CONSENT CALENDAR A. MINUTES of the February 8, 2018, Regular Meeting of the Board of Directors of the Successor Agency to the Palm Desert Redevelopment Agency. Rec: Approve as presented. B. CLAIMS AND DEMANDS AGAINST SUCCESSOR AGENCY TREASURY - Warrants Dated 1/31/2018, 2/2/2018, and 2/9/2018. Rec: Approve as presented. Upon motion by Harnik, second by Kelly, and 5-0 vote of the Board of Directors of the Successor Agency (AYES: Harnik, Kelly, Nestande, Weber, and Jonathan; NOES: None), the Consent Calendar was approved as presented. Vil. CONSENT ITEMS HELD OVER None VIII. RESOLUTIONS None 2 MINUTES SUCCESSOR AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY MEETING IX. NEW BUSINESS FEBRUARY 22, 2018 A. REQUEST FOR AUTHORIZATION OF THE IMPLEMENTATION OF A PROPERTY DISPOSITION STRATEGY FOR THE DESERT WILLOW LOT PADS OWNED BY THE SUCCESSOR AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY (SARDA) (JOINT CONSIDERATION WITH THE PALM DESERT CITY COUNCIL). Mr. Alvarez displayed a map of the Desert Willow lot pads owned by the Successor Agency to the Redevelopment Agency, and the lot pads are identified as A, B, C, and D. He said staff is tasked with the disposition of these parcels by getting them out to market and maximize the returns for the taxing entities. The City of Palm Desert is a taxing entity, so the City will retain about 3% of the proceeds. In conjunction with moving forward with the sale of these properties, staff is providing the City and Successor Agency a recommendation on a disposition strategy. The strategy outlined in the staff report identifies each parcel and its strengths and opportunities to attract specific targeted markets. He will provide a brief overview of the targeted uses and strategy for disposition of each parcel as follows: Parcel A: This parcel is outlined in red on the map. It's 16.86 acres and designated as resort/entertainment in the General Plan; the zoning is Planned Residential. This is a premier resort residential parcel and is located in close proximity to the clubhouse and has access to the circle on Desert Willow Drive. This is good opportunity to seek a developer that will provide additional resort residential use, which includes timeshares, fractional ownership, and vacation ownership that could be managed through a property manager. Staff is recommending going out for Request for Proposal (RFP) to seek the targeted land use he just described. Parcel B: This parcel is located south of the clubhouse and south of the overflow parking lot, and it's 13.72 acres. In his opinion, this is a premier lot that affords an opportunity to attract a boutique hotel with some branded villas. This lot is the highest elevated pad, which has 360 degree views around the entire lot. He noted Lot B and C are currently in an Exclusive Negotiating Agreement (ENA) with a developer that is seeking to establish a wave pool and hospitality project. Within the next two months, the developer will choose one of the two Tots. If Lot B is not chosen, staff will strongly recommend looking for a developer for a boutique hotel and branded villas through a RFP process. Parcels C and D: These Tots are unique, in that the two lots split at the Mountain View Golf Course Hole No. 5. Again, Lot C is currently in an ENA, and if the developer does not choose this lot, staff's recommendation is to look at keeping Lots C and D together. Staff will seek to bring a resort/residential component to these lots. The benefit of C and D, in terms of opportunities, is to tie Lots C/D to E, in that if you have a residential component there, it will certainly serve commercial uses that are 3 MINUTES SUCCESSOR AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY MEETING FEBRUARY 22, 2018 potentially on Lot E, and you have proximity to other shopping amenities that currently exists. Parcel E: Lot E is the key focal point of the staff report, because it's commercially zoned. It is 11.5 acres and the property has a driveway that bisects at the northern end of the lot that leads into the Ralph's Shopping Center. Staff recommends that the City Council invest in the purchase of this property to retain control and then seek a developer that is geared toward an entertainment/restaurant anchored facility. Retail is currently a soft market, so staff recommends the City seek a developer that will be focused on entertainment or music oriented uses, a small high -end theater, a branded brew house, unique experiential restaurants, cafes, dessert shops, or a unique experiential retail. The other component of this parcel is that the City has the opportunity of bond funds that are currently in place from the former Redevelopment Agency that can be used for infrastructure and parking, which would benefit the entire region. In combination of having control of the parcel, the City can secure a RFP and put it out to market and attempt to attract some of the uses mentioned. One possibility for utilizing existing former RDA bond funds is to facilitate a parking structure that would be underground. It could be designed to structurally hold a platform that would support commercial use on top, which would be a benefit to the region and a potential developer. In conclusion, he recommended approval of the proposed property disposition strategy and the City purchasing Lot E from the Successor Agency, and look for opportunities to develop that site through a RFP process. He offered to answer questions. Councilmember/Director Nestande commented that Lot B would be a better choice for the wave pool, so that Lots C and D can be kept together to be tied in with Lot E. She also wondered if there was anything that could be done at this point, since it was currently in an ENA. Mr. Alvarez replied he was reluctant to share his opinion, because he was waiting for all the information to come back from the developer, stating they are the ones doing the due diligence and analyzing their best options for that use. He added that he wasn't an expert on wave pools, but certainly both lots have their positives and challenges. As mentioned previously, Lot B is a premier lot for a hospitality project, but there will be challenges on both lots, because of the access and proximity to the other uses. Councilmember/Director Nestande inquired if there was a time expiration for the use of the Redevelopment funds for the purchase of a property. Mr. Alvarez explained that funds for the purchase of the property would have to come from General Fund Reserves. With respect to the bond funds, he deferred to Ms. Moore to answer the question. 4 MINUTES SUCCESSOR AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY MEETING FEBRUARY 22, 2018 Ms. Moore noted that bond funds could be used if the City decided to do any improvements with respect to public parking, but as far as acquiring the property, the funds would have to come from the General Fund. Mayor/Chair Jonathan asked for the definition of Resort Residential Project as it relates to pads C and D. Mr. Alvarez said Resort Residential Project could be a combination of timeshares or villas, and fractional ownership is similar or the same thing, it's just the way they are managed. However, you could have a combination of the three, including a community where you have vacation homes that are privately owned but managed through a property manager, similar to a homeowners association. Further responding, he said it would not exclude hotels. Mayor/Chair Jonathan inquired about what will happen to SA -RDA and these properties after June 30, 2018. Mr. Alvarez stated the local Oversight Board goes away and the City will then report to the Riverside County Oversight Board (RCOB). The City will have representation on that board from the City Council, including one staff member, but items and requests will have to be taken to the RCOB. Responding to question, he said the Successor Agency will still own and manage the properties, but it will lose some control, in terms of knowing some of the Oversight Board members here locally. Mayor/Chair Jonathan stated these lots mean a great deal to the future of Palm Desert, so to what extent was the City losing control and what can it do about it. Mr. Alvarez replied the City will still have land -use control through the existing General Plan and zoning regulations, and that process will still go through the City. The only control it would be losing is that when it decides to sell, the property value will be established through an appraised value and staff will need to seek approval for it from the County Board that may or may not have knowledge of the local market or the goals the City is trying to achieve. Mayor/Chair Jonathan commented that the mechanism that exists today where Council has a say as to what happens on those pads, he questioned if that ability will continue once the City has to go through RCOB. Mr. Alvarez replied that Council will have that ability in context of what is allowed under the current zoning regulations. Mayor/Chair Jonathan said he continues to be concerned about traffic circulation, ingress and egress, and what it would do to the quality of that development. On Desert Willow Drive there are five of these parcels attached to it and that's 75 acres of development, which is too much for that one drive even if it went to two lanes on each side. He said he wasn't including parcel G, because it will have its own direct 5 MINUTES SUCCESSOR AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY MEETING FEBRUARY 22, 2018 access. He encouraged staff to address this issue and have options in mind as development starts occurring. For example, there are possibilities for developing additional access off of Cook Street and Portola Avenue, and it may take some creativity. He believed there were possibilities for grading additional traffic circulation, ingress and egress, and he wouldn't want to lose that opportunity by not planning for it ahead of time. Mr. Alvarez agreed, stating staff will definitely keep that in mind. He said the Planning Department will look at it as well, especially the first project. Staff will look at the entire strategic plan and look at potential uses and traffic demands that will be generated. Interim Director of Public Works Tim Jonasson explained he would need to look at the Environment Impact Report (EIR) of the project, which would have included a traffic study, and he would need to be comfortable with whatever is being proposed. He added that he would be looking at the impacts and usuage to avoid problems with circulation, because that would be something that Public Works will be focused on. Councilmember/Director Kelly said she took Mr. Jonasson's comment to be that the City doesn't want to just minimally meet the needs, because of the importance of this destination as a resort. She believed the phrase used at one point when discussing this issue, is that it wants to achieve "Desert Chill" and not "LA Stress." She greatly supports his encouragement to explore solutions that assure the City is doing more than is minimally necessary to foot traffic. Councilmember/Director Nestande moved to, by Minute Motion: 1) Authorize staff to implement a property disposition strategy for the Desert Willow Lot Pads as outlined on Exhibit "A" of the accompanying staff report; 2) authorize SARDA Executive Director/City Manager to execute a Purchase and Sale Agreement (PSA) to sell SARDA-owned Desert Willow Lot Pad E to the City of Palm Desert for the appraised value of $2,670,000 after receiving approval from the Oversight Board and the State Department of Finance; 3) appropriate $2,670,000 plus related closing costs from the Unobligated General Fund Reserves. Motion was seconded by Weber and carried by a 5-0 vote (AYES: Harnik, Kelly, Nestande, Weber, and Jonathan; NOES: None). Councilmember/Director Kelly added she was very excited to see this on the agenda, because it struck her as the best response to the concerns Mayor/Chair Jonathan raised about moving it along while the City has maximum opportunity to influence outcomes. Mayor/Chair Jonathan commented there were high-level items on the agenda with the City Goals, Economic Development Plan, and the Desert Willow pads, adding that Council was addressing important policy issues that certainly shape the community's future 6 MINUTES SUCCESSOR AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY MEETING FEBRUARY 22, 2018 X. CONTINUED BUSINESS None XI. OLD BUSINESS None XII. PUBLIC HEARINGS None XIII. REPORTS, REMARKS, SUCCESSOR AGENCY BOARD ITEMS REQUIRING ACTION A. EXECUTIVE DIRECTOR None B. SUCCESSOR AGENCY COUNSEL None C. CHAIR AND MEMBERS OF THE SUCCESSOR AGENCY None XIV. ADJOURNMENT With Successor Agency Board concurren, air Jon ban -adjourned the meeting at 5:54 p.m. ATTEST: RAC ELE D. KLASSEN-, SECRETARY SUCCESSOR AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY SA AN, CHAIR 7