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HomeMy WebLinkAboutCitizens' Advsry Cmte PA4 - 06/21/2010 & 07/16/20100► PALM DESERT REDEVELOPMENT AGENCY CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JUNE 21, 2010 CALL TO ORDER Chairman Benford convened the meeting at 3:00 p.m. II. ROLL CALL Present: Absent: Fred Benford, Chairman Douglas Luhring, Member Roberta Grubb, Vice Chair Terry Archer, Member Russell Campbell, Member , J� �yy f%i/,� gY RDA6'-(,) Ron Crisp, Member ON del o Jane Daugherty, Member Phyllis Harkins, Member VERIFIED BY 1 i Kelly Litecky, Member Original on file with City Clerk's Office Staff Present: Martin Alvarez, Redevelopment Manager Mark Greenwood, Director of Public Works David Hermann, Management Analyst Justin McCarthy, ACM for Redevelopment Catherine Walker, Senior Management Analyst Guests: Robert Spiegel, Councilmember Mari Schmidt, Planning Commissioner Steven Orr, Palm Desert Redevelopment Counsel Gina Tenorio, The Desert Sun III. ORAL COMMUNICATIONS Member Harkins communicated that she received an email from Pam Hegel, 42900 Texas Avenue, to be delivered to the Project Area No. 4 Committee since she could not be present. Email read as follows: CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JUNE 21, 2010 "I am a homeowner on 42900 Texas Avenue who is out of the state for the summer. I am writing because of some concerns I have regarding the golf course. I understand it has shut down again. As most of us homeowners know from past experience, the lack of maintenance can cause some negative consequences for homeowners. Is the city planning on enforcing the maintenance agreement they have with the club? Will the city monitor the situation to make sure the trees are getting watered, weeds and grass are mowed and the clippings picked up so they don't decay and cause odor and fly problems like they did last year? I am also concerned about the maintenance of the ponds. Are they being filled? Are the aerators on? Lack of upkeep could cause fish, turtles, etc. to die and of course stagnant water is a health issue. I would appreciate any answers and updates you could provide regarding these issues." Ms. Carole Cottrell, 42635 Wisconsin Avenue, informed the Committee that she lives next to a house that is rented to young boys that party night and day. She expressed that she is unable to sleep and has called the Sheriff's Department twice. Once because they were stealing electricity from her home's outside outlet, and the other time was for having a party in the front at 2:00 in the afternoon. She has also called Animal Control because their two pit bulls were barking all night and all day. Now they are constantly partying day and night, and people are coming in and out. She explained that she is unable to sleep, wears ear plugs, she cannot afford to buy double -pane windows, and she cannot afford to move. She requested help from the Committee. Ms. Cottrell also mentioned that she has also contacted the Code Compliance Department when they were stealing the electricity. She stated that she does not call the Sheriff's Department every night on them. She voiced that she does not know what to do. Mr. McCarthy suggested that City staff meet with Ms. Cottrell, and look to see if there are other recourses that are available. Typically when there is a nuisance like this, calling the Sheriff's Department is the appropriate response. He mentioned that he does not know if there are other mitigations, such as would Ms. Cottrell be eligible for assistance under some of the City's home improvements programs that handle things like double -pane windows. Councilman Spiegel asked Ms. Cottrell if the Police Department went to the house when she called. She replied that they come out and take care GArda\Monica Loredo\Word\PA No. 4Mnutes\2010\Minutes 6-21-10.docx 2 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JUNE 21, 2010 of the problem for the moment, but then they start up again. Ms. Cottrell stated that if she calls the Police Department every night, they are going to get tired of her calling. Member Grubb noted that the property owner is responsible for nuisances on the property. Mr. Kilpatrick mentioned that he has an active case on the house she is talking about. It is a house that is going into foreclosure, and that he would continue working on the foreclosure issue. He commented that he would give the guy that lives there a call and let him know about the concerns. He would also pass it on to Lieutenant Shouse. Mr. McCarthy stated to Ms. Cottrell to not feel it is inappropriate to call the Sheriff's Department. It may be helpful to have a record of nuisance complaints. Ms. Cottrell thanked the Committee for listening to her. IV. CONSENT CALENDAR A. APPROVAL OF THE MINUTES OF THE CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MEETING OF APRIL 19, 2010. Minutes of the meeting from May 17, 2010, were unanimously approved as submitted and carried by an 8-0 vote with Member Luhring ABSENT. V. UNFINISHED BUSINESS None VI. NEW BUSINESS None VII. CONTINUED BUSINESS None Vill. OLD BUSINESS None GArda\Monica Loredo\Word\PA No.4\Minutes\2010\Minutes 6-21-10.docx 3 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO.4 MINUTES JUNE 21, 2010 IX. INFORMATIONAL ITEMS A. UPDATE: PALM DESERT COUNTRY CLUB UNDERGROUNDING (Catherine Walker, Senior Management Analyst) Ms. Walker reported that at the last meeting they discussed community outreach and what will the City do in terms of educating the community. She displayed an updated estimate of the breakdown. She noted that the engineer's report will not be considered a final document until it is approved by the City Council. Ms. Walker went over the estimates, which were as follows: Annual Assessment (30 yrs. @ 8.5%) for Single -Family Residence Category 1 (w/meter or panel) $882 Category 1 (no meter) $677 Category 2 (w/meter/panel only) $540 Category 3 (condo) $99 Public Assessment & Private Assessment for Single -Family Residence Category 1 (w/meter/panel) $8,939 Category 1 (no meter) $6,737 Category 2 (meter/panel only) $5,268 Category 2 (condo) $786 Member Archer inquired if the assessment would be for 30 years. Ms. Walker replied yes. Chairman Benford asked if the annual rate is 8.5 percent. Ms. Walker answered yes. Member Archer commented that in today's interest rates, home rates are in the four's. The federal government is loaning money for less than a percent. He stated that he sees this program going at no interest charge. He does not know if that is possible under the criteria it is setup for. He mentioned that he has talked to a number of residents that are involved in this, and he has not been able to find one person willing to go on with this even if they had the cash. Member Archer commented that he is thinking of a way to possibly bring this forward to somehow do this so they wouldn't be charged an interest rate and a penalty if they decide to pay it off early. Mr. McCarthy explained that one of the challenges is that a lot of the improvements happen to be on private property, and that then drives the GArda\Monica Loredo\Word\PA No. 4Mnutes\2010\Minutes 6-21-10.docx 4 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JUNE 21, 2010 City away from tax exempt rates that might be five or six percent for this type of financing. He stated that the only way of avoiding interest is simply paying it off upfront. For the most part, the City has reduced the cost of the public improvements from approximately $15 million down to about $3 million. He stated that a de minimis portion of this is interest on the public improvements. Historically, the City has typically paid approximately 50 percent of the undergrounding districts, which is the standard. Member Daugherty asked who is making the loan. Mr. McCarthy responded that the loan is a bond issue. Chairman Benford commented that anyone can go to any bank and get a 4.5 percent loan. Member Archer mentioned that the City offers other programs through the Redevelopment Agency under the Home Improvement Program (HIP) with no or low interest grants. Councilman Spiegel interjected that they have to remember the City is paying for over 50 percent of the undergrounding. Mr. McCarthy stated that at the end of the day this is a discretionary decision on part of this community. He referred to the pictures displayed showing a community with overhead utilities and another community with undergrounded utilities. In reference to interest rates, he noted that you can impute that interest is half the 8.5 percent because the City is paying for half of the project cost. Ms. Carol Benford, 42880 Tennessee Avenue, mentioned that the city of Indian Wells is doing an undergrounding project in an area off Warner Trail and Fred Waring at no percent interest to the residents. The residents do have to pay something towards it, but are not being charged interest. She asked if she is wrong about that. Mr. McCarthy stated that he does not know the specifics. He does believe it is a deferred loan that basically the payment comes out when you sell your house. Ms. Benford inquired if it would be the same for Palm Desert. Mr. McCarthy responded no. He explained that the assessment is paid by the current owner, and remains with the successor when the home is sold. He stated that he is not sure how Indian Wells is handling the interest. However, the improvements on their property are not eligible for the G:\rda\Monica Loredo\Word\PA No. 4\Minutes\2010\Minutes 6-21-10.docx 5 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JUNE 21, 2010 Redevelopment funding. So the only way to avoid that is to have it come out of the general fund, and he can say that is not going to happen. Mr. McCarthy communicated that there is an opportunity to do the undergrounding at Palm Desert Country Club, timing is everything, and the timing is not propitious. No one anticipated three years ago when this effort was started and finally got it rolling that they would be in the middle of the economic straits that they are in right now or have the challenge that they have at the Palm Desert Country Club Golf Course. If the community wants to defer it to a later date, it would be up to the City Council to determine whether or not they would like to do that. It was mentioned that approximately $600,000 to $1 million and a great deal of staff time has been put into the undergrounding. The City will do the outreach to the community. It was noted that the City Council has directed staff to take it to ballot. Councilman Spiegel commented that it was discussed not taking it out to ballot until October when people are back in town. He noted that the vote has to be 51 percent to move forward. Mr. McCarthy noted that staff originally thought the project would cost $35 million. After receiving the estimates, the cost is one-third less than they anticipated. Councilman Spiegel briefly mentioned the process his community went through to be undergrounded. Chairman Benford inquired if people are going to vote on the estimate displayed. Ms. Walker responded no. She explained that at the time of formal balloting, each individual home owner will receive a record of the assessment amount so they know what they are voting on. Ms. Schmidt asked if the 51 percent is from those affected or 51 percent of those voting. Ms. Walker replied that it is 51 percent of those voting. Mr. McCarthy briefly explained the voting process. Member Archer commented that he personally rather pay to see a nice golf course. Ms. Walker informed the Committee that two forums are scheduled for July 14 and July 27, from 4:00 p.m. to 6:00 p.m. in the Council Chamber to provide the community with as much information as possible. GArda\Monica Loredo\Word\PA No. 4\Minutes\2010\Minutes 6-21-10.docx 6 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JUNE 21, 2010 Member Grubb suggested that staff explain at the forum the tax rolls and what happens when you sell your home. Ms. Walker mentioned that staff is also going to make an effort to have the engineer's report and property assessment accessible to the resident on the City's website. Staff is looking into the City's security and internet procedures to see what could be posted. Member Harkins inquired how the City is going to disseminate the information regarding the forums to the home owners affected. Ms. Walker responded that a letter via standard mail would be sent out to everyone. Mr. McCarthy added that the City would be happy to come out to Palm Desert Country Club if the homeowners' association (HOA) would like to host the City. Member Harkins noted that the HOA Board will not be meeting until September 14. Mr. McCarthy commented that the key from staff's perspective, the City only wants to be able to disseminate as much information and get as much information out to the community so that people can make an objective and informed decision as to what they would want to do. At the end of the day, the Committee has seen the dichotomy of opinions. How valuable is elimination of what some might consider being blight? Ms. Walker displayed a map of the potential area to be undergrounded. Chairman Benford asked how long it would take to do the undergrounding. Councilman Spiegel responded it would take about four to five months. B. UPDATE: PALM DESERT COUNTRY CLUB GOLF COURSE (Shawn Kilpatrick, Code Compliance Officer) Mr. Kilpatrick stated that he is assigned to inspect the Palm Desert Country Club area. He has been given the task to conduct a weekly inspection of the Palm Desert Country Club Golf Course. He introduced Mr. Steven Orr, City Attorney, who is assisting the City with the bankruptcy proceedings. Mr. Kilpatrick presented photos and reported on the conditions of the golf course. It was asked if the property has been transferred to Wilshire Bank. Mr. Orr replied no. The Palm Desert Country Club Golf Course is in bankruptcy so the property cannot be transferred without the Bankruptcy Court approval. GArda\Monica Loredo\Word\PA No. 4\Minutes\2010\Minutes 6-21-10.docx 7 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JUNE 21, 2010 The most likely way and almost the only way the Bankruptcy Court is going to transfer ownership is through a sale so it would be impossible for Palm Desert Country Club to transfer its assets to anybody without the Bankruptcy Court's blessing. If they attempt to, it would be part of a court proceeding that would be a publicly noticed hearing and process. It was asked what the timeframe is for a bankruptcy to take affect or the property to be transferred to somebody that can maintain it and turn it back into a golf club. Mr. Orr communicated that Palm Desert Country Club filed a Chapter 11 reorganization proceeding last year. They have not moved along very quickly. He stated that they have done so little that the Bankruptcy Court dismissed the bankruptcy for lack of action. Palm Desert Country Club then quickly filed an emergency motion to reinstate their bankruptcy proceeding, and that motion was granted on April 1 of this year. Since then, Palm Desert Country Club has done nothing in terms of filing things in the Bankruptcy Court. Mr. Orr mentioned that he will meet with the City Council in closed session on options to give the bankruptcy a kick. Mr. Orr stated that as long as it is in bankruptcy, and anything with regard to the ownership is controlled by the Bankruptcy Court. He noted that this case was transferred from a long- time bankruptcy judge to a newly appointed bankruptcy judge, and this is one of her new cases. He mentioned that Palm Desert Country Club (Debtor) has not filed an operating report for any period after January 31 of this year. It is in all likelihood, the City is going to press the Bankruptcy Court of the US Trustee or someone to force them into taking some action. Two weeks ago, Wells Fargo Financial Leasing, the entity that leases the maintenance equipment, sought relief to repossess the equipment because Palm Desert Country Club was not making the $5,400 a month payment. The Bankruptcy Court granted that motion, and they should expect to see the equipment go away along with the golf cart equipment plus anything else that was leased. Mr. Orr mentioned that after talking to one of the lawyers for Palm Desert Country Club, Wilshire Bank or Mr. Kosmont is not interested in putting more money into this project. He noted that the course may remain. As long as there is electricity, they can operate the wells. The wells are not hooked up to the City or the Coachella Valley Water District (CVWD). Mr. Orr also noted that the bankruptcy law does not prevent Southern California Edison from turning off the electricity. If the electricity is turned off, he suspects it would be a short time to where you will see significant browning and significant issues with regard to the ponds. He explained that the City has an Operations and Maintenance Agreement with the Debtor, which is a contract like any other contract that a bankrupt entity G:\rda\Monica Loredo\Word\PA No. 4\Minutes\2010\Minutes 6-21-10.docx 8 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JUNE 21, 2010 has with other people. So the City is subjected to the Bankruptcy Court's jurisdiction as to what the City could do under that contract. However, from a Code Enforcement standpoint, that means enforcing the minimum nuisance standards that apply to the community. Mr. Orr stated that does not necessarily mean a green lawn or aerated pond. The City cannot make them pay their electric bill or mow the grass. What the City can do is code enforcement, which is what the City is considering doing. His personal guess is that the Bankruptcy Court at some point will direct the Debtor to proceed towards selling the property, and someone else's guess is as good as his if there is someone out there who is going to buy the property. Mr. Orr stated that the golf course is one of the very few in the whole state where the golf course is not economically connected to the surrounding neighborhood. Ninety-eight to ninety-nine percent of courses have a relationship where there is money going in to keep it maintained. He stated that it is very unusual to have this situation, which makes it more complicated. The Bankruptcy Court could convert it from reorganization where the Debtor is in possession and is going to reorganize the business, which does not seem doable by Palm Desert Country Club. Or, it could be converted into a Chapter 7, which is liquidation and there could be an auction for the property. Chairman Benford asked what the possibility of going into Chapter 7 is. Mr. Orr responded that it is relatively good. He is assuming that no one is going to come forward with a plan of reorganization so the bankruptcy court could convert it into liquidation and cause it to be sold. It could be anyone's guess. Who would buy this property where there is no economic connection between the residents and the golf course? Mr. Orr mentioned that the bankruptcy case is public information, and anyone can monitor the case like he does. Councilman Spiegel inquired if it is recommended a group of concerned residents meet with the Bankruptcy Court to explain how important it is to them and to do something about it. Mr. Orr responded that the most effective way for a concerned citizen is to communicate with the United States Trustee, which is the entity that caused the bankruptcy to be dismissed. The last time, it was reinstated very quickly. He said that he did not have the address, but that they could email him at sorr(a)rwalaw.orq for the address. GArda\Monica Loredo\Word\PA No. 4\Minutes\2010ftnutes 6-21-10.docx 9 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JUNE 21, 2010 Ms. Schmidt asked if there is a buyer, what the restrictions on zoning are. Mr. McCarthy responded that it does not change the zoning. It would be sold as -is and subject to the current land use restrictions. Member Crisp inquired if there would be any reason why they would drag their feet in the proceedings. Is there a benefit for them? Mr. Orr answered that there is possibility to keep the creditors away for a little while, but there is not really much of a reason. It depends on what the Bankruptcy Courts wants to do. Mrs. Benford voiced that it is incredibly distressing. She believes the residents would do everything they could do, but are somewhat powerless to do very much. The residents are dependent on the City's activity, and having the City put pressure on them to do something. She stated that they are not talking about a store that closed at the mall; there are thousands of people that live in that area. There are some that have lived there for many years, and their home could be the only asset they have. Mr. Kilpatrick continued presenting pictures of the golf course. Councilmember Spiegel inquired if there are abatement issues and the City takes care of it, is there a lien put on the property. Mr. Orr responded that a lien could not be put on the property as they would normally in an ordinary nuisance abatement situation because of the bankruptcy. There is a procedure to create a special assessment that exists in the City's municipal code that could be followed. Bankruptcy law is not unsettled, but there is not much in the bankruptcy law about this kind thing. It is possible that the City would be able to put it on their property tax bill. Mr. Don Colletta, President of the Men's Club at Palm Desert Country Club, 43790 Venice Drive, La Quinta, commented that the trees are about 45 years old. If they do not continue to get watered, they will start coming down one after another. Mr. Larry Guardanapo, 43080 Illinois Avenue, mentioned that in some of the rough areas where grass is growing wildly, there are many different types if insects living in there. He also mentioned that there are weeds growing 6 to 18 inches high. Mr. Orr voiced that if they have photographs of areas that are really bad, to please send the pictures to him. They are useful to him. He mentioned that private citizens are not allowed to go on the property, but if you can get some of the bugs in a jar that is also helpful. G:\rda\Monica Loredo\Word\PA No. 4\Minutes\2010\Minutes 6-21-10.docx 10 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JUNE 21, 2010 Member Harkins stated that she has a complete list of the contact information for the bankruptcy court to submit complaints. Mr. Orr commented that the presence of bugs is a compelling instance. Vermin are particularly helpful for the purpose of going to court because there are health hazards associated with that. Vermin is defined as rats, mice; basic small furry things. Ms. Bryna Tobey, 77306 Missouri Drive, commented that she has vested quite a sum of money in her backyard. She noted that she lives on the golf course. What is happening is that the grass and the weeds from the golf course are destroying her backyard. She has pictures if they are needed. Mr. Orr said to send him the pictures. Member Daugherty asked for the formal name of the bankruptcy complaint. Following is the information. In Re: PDCC Development, LLC, Case No. 6:09-BK-23674CB. The US trustee is Everett Green, 3685 Main Street, Suite 300, Riverside, California 92501. His number is (951) 276- 6063 and fax number is (951) 276-6973. Email address is Everett. I.areena-usdoi.aov. Ms. Tobey voiced that she has a concern that the dead grass is a fire hazard. She commented that she is grateful that a huge amount of grass was taken care of by her home. Mr. McCarthy interjected that if Ms. Tobey sees something that is a fire hazard to please contact Mr. Shawn Kilpatrick. He noted that aesthetics are not a health hazard, and that the City would not mitigate aesthetics. Mr. Orr reiterated if there are pictures that indicate there is a problem, please send them to him. Mr. Colletta stated that a resident told him that the restrooms at the 14tn hole are being used for drug dealing. He was told that the Police were called several times, but they disappear onto the golf course. He stated that the restrooms need a pad lock. Mr. Kilpatrick remarked that he would let Lieutenant Shouse know that this is happening on the 14t" hole. Ms. Schmidt asked who runs the water at the golf course. Mr. Kilpatrick replied that the CVWD is pumping the water. It was noted that the well and GArda\Monica Loredo\Word\PA No. 4\Minutes\2010\M1nutes 6-21-10.docx 11 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JUNE 21, 2010 the equipment belong to the golf course, but CVWD owns and supplies the water. Mr. Kilpatrick mentioned that the City is working with Vector Control to treat the golf course for the red imported fire ants. Mr. Orr noted that if photos are submitted for the court, the person has to be willing to sign that they took the photographs. Ms. Barbara Koltweit, 77695 Michigan Drive, stated that she lives near the 4t" hole and temporary maintenance area. She mentioned that her son has been cleaning the weeds and trying to improve the area. She inquired if they are trespassing. Mr. Kilpatrick responded that the bigger concern is the people that are off-roading and drug dealing. Mr. Orr commented that people could notify other agencies besides the City such as the Fire Department for fire hazards, Vector Control, or Animal Control for loose or dumped dogs. These agencies will also respond if there are health and safety issues. He noted pictures could be sent to sorr(cDrwalaw.com. Vice Chair Grubb inquired if there is any chance in the future that the City would go in and run the golf course like the Desert Willow golf course. Mr. McCarthy responded that he would never make that recommendation to the City Council. The Palm Desert Country Club golf course is not necessarily viable. He explained that Desert Willow supports itself. It was capitalized by the Redevelopment Agency, but it is structured in such that it is high enough into the market that it tends to support its own operating costs. It is further supported economically by the timeshares that surround Desert Willow. He noted that not in terms of use, but in terms of direct fees the timeshares and developer have to pay on a one-time basis and an ongoing basis. Desert Willow was designed as an economic development strategy along with being a public amenity as a municipal golf course. He commented that those opportunities do not lend themselves or are available at Palm Desert Country Club. He also explained that from an operating standpoint, if it was not to be self supporting, you could not fill the gap with Redevelopment money and money would have to be taken from the General Fund. General Fund money is police, fire, and general services. Mr. Colletta commented that the Palm Desert Country Club golf course has been self-sustaining for 40 years, and it has had its rough times due to management and ownership. When management and ownership was right, the golf course took care of itself for a lot of years. He stated that he GArda\Monica Loredo\Word\PA No. 4\Minutes\2010\Minutes 6-21-10.docx 12 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JUNE 21, 2010 has been a member there for 20 years, and they have been through at least three rough times. If the City were to take the golf course over, you need about 180 rounds a day to maintain the course. The golf course could be viable with a little bit of advertising to bring the public back in. He believes the club could work with the right management group and enough money for advertising. C. INFORMATIONAL: LETTER FROM CAROL BENFORD REGARDING PALM DESERT COUNTRY CLUB GOLF COURSE (Fred Benford, Chairman) Mr. McCarthy stated that the letter brings up some legitimate issues. All he could offer is expanding the context a little bit. He communicated that the general theme of the letter is why not use some of the $12 million slated for the undergrounding as a capital reserve fund for the golf course to mitigate operations. Mr. McCarthy explained that the City has General Fund money, which tends to be flexible money and is used for maintenance of streets, police, general operations, and that kind of stuff. Councilmember Spiegel interjected that the General Fund money primarily comes from sales tax and hotel occupancy. Mr. McCarthy continued to explain that the City's General Fund budget is around $44 million a year, which takes care of all general operations around the City. The second largest revenue stream is Redevelopment funds. There are limitations on how you can use Redevelopment money, which are for capital type of expenditures that are typically of a public nature to help mitigate blight or promote economic development. Mr. McCarthy stated that Redevelopment money could not be used to maintain the golf course. The other fund is Affordable Housing money, and only could be used for affordable housing. He explained that if the City were to get involved with the golf course, funding would have to come out of the General Fund. He stated that staff calculated an estimate for the annual maintenance costs for the golf course. Calculations are based on a park maintenance standard. Staff estimated it would cost roughly $850,000 to $900,000 a year to maintain 173 acres of open space. He noted that the cost could be reduced if you permit the grass to die off during the winter. There are 833 homes that back up onto the golf course, and are the significant beneficiaries. The estimated annual assessment for the 833 homes would be approximately $1,073 per household. If you were to convince the neighbors that do not abut the golf course and split the cost equally, the estimated annual assessment would be approximately $581. G1rda\Modca Loredo\Word\PA No. 4\Minutes\2010ftnutes 6-21-10.docx 13 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JUNE 21, 2010 Ms. Walker presented a map that shows 25 golf courses in Palm Desert. Mr. McCarthy communicated that all 25 courses are supported in part and in some manner by the residents that are around those golf courses. Mr. Colletta voiced that the biggest complaint is that the residents did not want to support private ownership. But if it were to be a City golf course, the idea would go across. Mr. McCarthy responded that they all could express their views and different opinions, but he would still make a negative recommendation. He feels the right owner would be the homes on the golf course. He suggested letting the asset go through the difficulties that it is going to go through, and either there is going to be a successor owner that maybe can be in position where the community can have dialogue with or there may be an opportunity for the community to decide if they want to get into the golf course business. Ms. Benford commented that the information was more than she expected and thanked staff. She also commented that she would be happy to spend $100 a month to have a decent place to look at and to walk on. Member Crisp stated that when putting out the word on the undergrounding, can they bring up the golf course as well. Mr. McCarthy replied that this is a heart to heart discussion that the community needs to have with itself. Member Crisp voiced that staff is taking the undergrounding information out to the community, why can't the City take the golf course out to the community. Mr. McCarthy replied because the City is using public money for the undergrounding. Mr. Colletta expressed his concern that he has 125 members in the men's club, and they have an opportunity to move over to Palm Desert Resort Country Club. After hearing the discussion at this meeting, it is a no brainer to take their offer. Chairman Benford commented that if nothing happens with the golf course by the first of the year, let the community have a choice between undergrounding and the golf course and a $100 a month. Mr. McCarthy interjected that the community has that choice right now. The community does not need the City taking over the golf course. He stated that this is a decision that the community needs to make, and not a decision that the City needs to present to them. He explained that from the City's G:\rda\Monica Loredo\Word\PA No. 4\Minutes\2010\Minutes 6-21-10.docx 14 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JUNE 21, 2010 perspective, staff will present the undergrounding. If the community says yay, the City could move forward. If they say nay, they could move forward. Chairman Benford stated that his concern is that the City Council is going to say we have given you undergrounding, and now the community is coming back and wants the City to take over the golf course. It ends up being a timing issue. Mr. McCarthy indicated that under either scenario, he would recommend that the City Council not get involved in the golf course. As he mentioned, there is a natural right owner and right interested party; that is the collective property owners surrounding the course. Councilman Spiegel voiced that Palm Desert Country Club is not the only course that is in bad shape in the City. There are 25 courses in the City, and the City has no desire to take over all kinds of golf courses. He stated that is not what the City is supposed to do for the residents. Mr. McCarthy added that the other golf courses that have been in trouble, their solutions were basically the surrounding property owners brought the golf course out of bankruptcy. In another case, they increased their assessments. Member Daugherty inquired in order to have an assessment district, how do you legally do that. Mr. McCarthy explained that you can wait till you have a buyer and the community could approach the buyer and say what if we create a master HOA and provide you with some level of support. What if we create a landscape district that comprises the 833 homes and provide with some level of support. Or go through the same exercise that they have been through historically. You let another private operator come in, maybe a combination of an improvement in the market and the economy and a better managed operation, and this problem solves itself for a period of time. Chairman Benford commented that the key is Chapter 7. X. REPORTS AND REMARKS A. COMMITTEE CHAIRPERSON/MEMBERS B. AGENCY BOARD LIAISONS C. PLANNING COMMISSION LIAISON G:\rda\Monica Loredo\Word\PA No. 4\Minutes\201Minutes 6-21-10.docx 15 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JUNE 21, 2010 D. STAFF XI. ADJOURNMENT Upon a unanimous motion by the Project Area No. 4 Committee, the meeting was adjourned at 4:55 p.m. Monica Loredo, Recording Secretary G:\rda\Monica Loredo\Word\PA No. 4\Minutes\2010\Mlnutes 6-21-10.docx 16 �C PALM DESERT REDEVELOPMENT AGENCY CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JULY 19, 2010 CALL TO ORDER Chairman Benford convened the meeting at 3:00 p.m. II. ROLL CALL Present: Fred Benford, Chairman Roberta Grubb, Vice Chair Terry Archer, Member Jane Daugherty, Member Phyllis Harkins, Member Kelly Litecky, Member Absent: Russ Campbell, Member Ron Crisp, Member Douglas Luhring, Member Staff Present: Lauri Aylaian, Director of Community Development Mark Greenwood, Director of Public Works David Hermann, Management Analyst Shawn Kilpatrick, Code Compliance Officer Justin McCarthy, ACM for Redevelopment Pedro Rodriguez, Senior Code Officer Catherine Walker, Senior Management Analyst John M. Wohlmuth, City Manager Guests: Robert Spiegel, Councilmember Mari Schmidt, Planning Commissioner Lt. Andrew Shouse, Palm Desert Police Blake Herzog, The Desert Sun ORAL COMMUNICATIONS 06.1 ve- ! BY RDA ON q- (?- do/ o VERIFIED BY i� T original on file with City Clerk's Office Mrs. Carol Benford, 42880 Tennessee Avenue, read a letter to the Committee that was written by Mr. and Mrs. Benford. CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JULY 19, 2010 "We are homeowners in Palm Desert Country Club whose homes face the golf course and we are deeply concerned about the condition of the golf course and its future. Since the course was built, people in this community have enjoyed the benefit of living on or near a course without financial participation. The fees from golf members and public play have, until late, managed to keep the course operating. Given current costs to operate and maintain a golf course, we are doubtful that the club is a viable enterprise without support beyond memberships and public play. While the course is a benefit to the whole community, it is of particular benefit to the homes facing the course. We feel that a reasonable financial participation from the golf course facing homes may be a way to keep what has happened in the last few years from happening again. One way this participation might be handled is through a special assessment district controlled by the City. (We have no confidence in turning over funds directly to the golf course owner no matter who that may be.) There may be other methods to address this issue, and we would like to know the mind of the community. We are asking the City Council to hold a public forum, perhaps more than one, for this purpose. At present the City has held and will be holding forums regarding the underground utilities project. While we appreciate what the City has done in this regard, we believe the condition of the golf course and its future is a far more pressing issue and one which needs to be addressed sooner than later. Pease respond to Mr. Fred Benford, Chair of Project Area 4, as soon as possible." Mrs. Benford stated that she would be accepting anyone that would like to sign the letter as a sort of a petition or talk to her after the meeting. A member of the Committee asked Mrs. Benford who is "we" referred to in the letter. She responded that "we" is referred to the people who will be signing the letter. She noted that she has at least half a dozen people that are willing and ready to sign the letter, and hopes there will be more signatures. Member Grubb asked how many homes are on the golf course. Mr. McCarthy answered 833 plus the apartments. GArda\Monica Loredo\Word\PA No. 4\Minutes\2010\Minutes 7-19-10.docx 2 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JULY 19, 2010 IV. CONSENT CALENDAR None V. UNFINISHED BUSINESS None VI. NEW BUSINESS None VII. CONTINUED BUSINESS None VIII. OLD BUSINESS None IX. INFORMATIONAL ITEMS A. UPDATE: PALM DESERT COUNTRY CLUB UNDERGROUNDING (Catherine Walker, Senior Management Analyst) Ms. Walker reported that the forum was very successful. There were approximately 60 people in attendance. A second meeting is scheduled for July 27. She mentioned that staff received very good feedback. People said it was a good informational session, and staff answered questions as confidently as they possibly could. She noted that it was the same presentation given by Willdan that was presented to the Committee. Staff is working on adding the assessment information to the City's website. Member Archer mentioned that one of his neighbors never received a notice of the meetings. Ms. Walker asked if his neighbor is part of the assessment district. Member Archer responded that he is part of the assessment district, but has a different mailing address. Member Archer asked if the notices are returned if undeliverable. Ms. Walker explained that a third party mailing service was used, and that there was a verification process that notices were sent out. There were a couple of residents that did not receive the letters and staff is looking into G:\rda\Monica Loredo\Word\PA No. 4\Minutes\2010ftnutes 7-19-10.docx 3 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JULY 19, 2010 it. She noted that there will be another group of notices that will be sent out in the fall. Member Archer inquired if there is a list of addresses that are part of the undergrounding. Mr. McCarthy replied that a list will be available online. Member Harkins asked if the letters went out to local addresses. Ms. Walker responded that the letters went to the mailing address on the tax roll. Mr. McCarthy noted that he received some phone calls from people that are out of state. He asked Member Archer for the address of his neighbor so they could track it and try to correct it. Member Grubb asked what the tone of the meeting was. Ms. Walker responded that the residents were appreciative that staff was presenting all the information that they could. Mr. McCarthy added that some of the same issues were discussed; status of the golf course, its future condition, there was sentiment about waiting, and there were some people that thought it was a good idea. There was a mix response, but not hostile. He stated that a former Southern California Edison employee indicated that there might be a process under the law whereby the utilities have to depreciate their asset and maybe contribute. Staff has contacted legal counsel to look into that to see if there is some type of process. Staff is also exploring other options under the Home Improvement Program (HIP) for some of the onsite costs, primarily for the lower income people. Chairman Benford stated that comments at the meeting were less than positive. It was mentioned that the information was well presented at the meeting. Mr. McCarthy commented that the ultimate test will be the ballot, if they get to that point. B. UPDATE: PALM DESERT COUNTRY CLUB GOLF COURSE (Shawn Kilpatrick, Code Compliance Officer and Catherine Walker, Senior Management Analyst) Mr. Kilpatrick reported that there is not a lot to report. He indicated that they have started mowing, and the City Council authorized funds for the contractor abatement of the course. He noted that the bank paid for the G:\rda\Monica Loredo\Word\PA No. 4\Minutes\2010\Minutes 7-19-10.docx 4 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JULY 19, 2010 repair of the pump, and noticed the irrigation was on. He presented a few pictures of the golf course. He mentioned that he had a conversation with the special asset manager of Wilshire Bank. The manager expressed his thanks to the City Council for being pleasant with them. He also expressed it was Wilshire's desire to do what is right and take care of the asset. Mr. Kilpatrick mentioned that the electric bill was paid, but they had to pay a $34,000 deposit to maintain services. The remaining issues are that they are still getting down limbs and grass clippings. Mr. Herman interjected that he received a call from a resident this morning, and he mentioned the grass clippings were removed. Member Harkins asked for the status of the Chapter 7. Mr. McCarthy responded that Palm Desert Country Club (PDCC) golf course has filed for Chapter 7. There has been discussion with both the bankruptcy counsel and counsel with Wilshire Bank. Wilshire Bank is petitioning for authority to maintain the asset, but they have to get approval from the bankruptcy court. He stated that it appears Wilshire has engaged a bankruptcy counsel who has a good deal of experience and actually acted as a trustee for a golf course for an extensive period of time. The City speculates that the bank is definitely asserting itself more in terms of actively becoming engaged at the golf course. Things are moving forward, hopefully, to an ultimate disposition of the asset to somebody that can maybe do something with it. Chairman Benford commented that it is going to be difficult for someone to buy the golf course and make a profit off of it. Consequently, that is the purpose of the possibility of an assessment. He stated that the key factor is that the property values are dependent upon the golf course. He guesses that an assessment would be less than the undergrounding. He said many think that the golf course assessment would bring more of a benefit to the home owners and the community than the undergrounding, and that is the reason he and his wife came up with the petition. Councilmember Spiegel stated that since the bankruptcy, it is the first time in months that progress has been made at the golf course. Councilmember Spiegel asked Lt. Shouse if there has been any problem at the golf course. He replied that they will respond to any service calls on the property and investigate on a case -by -case basis. He mentioned that if there are any shenanigans going on, to please call the Police Department. He did mention for people to be reasonable about expectations. He explained that someone that is vandalizing is reasonable compared to someone that is just trespassing. GArda\Monica Loredo\Word\PA No. 4\Minutes\2010\Minutes 7-19-10.docx 5 CITIZENS' ADVISORY COMMITTEE FOR PROJECT AREA NO. 4 MINUTES JULY 19, 2010 X. REPORTS AND REMARKS A. COMMITTEE CHAIRPERSON/MEMBERS B. AGENCY BOARD LIAISONS Councilman Spiegel asked if there will be a meeting in August. Mr. McCarthy responded that staff will monitor the situation at the golf course. If there is not really a reason to have a meeting, staff will contact the Chairman about potentially going dark in August. C. PLANNING COMMISSION LIAISON D. STAFF XI. ADJOURNMENT Upon a unanimous motion by the Project Area No. 4 Committee, the meeting was adjourned at 3:25 p.m. Monica Loredo, Recording Secretary Wrda\Monica Loredo\Word\PA No.4\Minutes\2010\Minutes 7-19-10.docx 6