MINUTES
REDEVELOPMENT AGENCY AND CITY COUNCIL
REGULAR MEETING
MAY 8, 2007 - 6:00 p.m.
CALL TO ORDER
The regular meeting of the City Council and Redevelopment Agency of the City of Highland was called to order at 6:00 p.m. by Mayor Jones at the Donahue Council Chambers, 27215 Base Line, Highland, California.
The invocation was given by Reverend Jeff Bumgardner of Immanuel Baptist Church and the Pledge of Allegiance was led by Councilwoman Scott.
ROLL CALL
Present: Lilburn, McCallon, Scott, Timmer, Mayor Jones
Absent: None
SPECIAL PRESENTATIONS
Citrus Harvest Festival Community Spirit Awards were presented.
COMMUNITY INPUT
Ms. Fay Jure stated the property at Base Line and Olive has a request for construction of three homes. She never received a copy of these plans. She was not aware of any proposed building on the property. She did contact City Hall and was informed the notification was mailed out some time ago. She never received it. The only way she received a copy is by coming to City Hall and getting the copy here. Her main concern is how the proposed brick wall is going to affect coming to the street. From looking at the plan she can see nothing where it indicates where these items will be located.
CITY COUNCIL/REDEVELOPMENT AGENCY CONSENT CALENDAR
A MOTION was made by Councilman McCallon, seconded by Mayor Pro Tem Lilburn, to add an additional item to the agenda declaring a vacant seat on the Public Nuisance Hearing Board and to direct the City Clerk to advertise the vacancy pursuant to the Maddy Act. Motion carried, 5-0.
A MOTION was made by Councilman Timmer, seconded by Mayor Pro Tem Lilburn, to approve the consent calendar as submitted with the exception of item #7, #9, #10 and #11 being pulled for further discussion. Motion carried on a roll call vote, 5-0, with Councilwoman Scott abstaining from item #2 and #3 and also with Councilman Timmer abstaining from item #2 and #3.
1. Waive the Reading of All Ordinances
Waived the reading of all Ordinances in their entirety and read by title only.
2. Minutes - April 10, 2007 City Council Regular Meeting
Approved Minutes as submitted.
3. Minutes - April 10, 2007 RDA Regular Meeting
Approved Minutes as submitted.
4. Warrant Register
Approved Warrant Register No. 440 for May 8, 2007, in the amount of $1,235,534.69 and Payroll of $117,992.83.
5. Treasurer's Report for March 2007
Received and filed Treasurer's Report for March 2007.
6. Claim Consideration - Maritsa PapaAndreas
Rejected claim.
8. Adoption of Resolution No. 2007-019 Ordering the Sale of One (1) Excess City Vehicle
Adopted Resolution No. 2007-019 ordering the sale of one (1) excess City vehicle (VIN# 1GBGC24K7SE219304) through Nationwide Auction Systems, 13005 E. Temple Avenue, Industry, CA 91746.
RESOLUTION NO. 2007-019
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF HIGHLAND, CALIFORNIA,
ORDERING THE SALE OF AN EXCESS CITY VEHICLE
ITEMS REMOVED FROM THE CONSENT CALENDAR
7. Memorandum of Understanding with Smart & Final Stores Corporation for Emergency Supplies During Disasters and Emergencies
Councilwoman Scott stated she has reviewed the list of supplies and there is no cost associated with the supplies. There also is no comparison in relation to other warehouse stores. She opposes certain selections of foods such as candy and colas. She would also like to know who will be declaring an emergency status.
City Manager Hughes stated this would be like any other declaration of an emergency by the city, same process, and this item is an additional tool the city will have.
Mayor Jones stated he is in opposition to Councilwoman Scott's comment about the candy and colas because the job expected by these individuals to conduct in all types of adverse conditions, in all types of adverse situations, we ought to do everything in our power to keep their morale, their spirit, their desire to be able to fight in any situation at its highest. If it requires a candy bar or so he's in favor of buying those.
Councilwoman Scott stated she does not want candy bars for the emergency supplies. She feels it is not appropriate.
Mayor Jones stated it is for emergency personnel who are working in these conditions and is needed to keep them going.
Administrative Analyst Rissmiller stated the list in which Councilwoman Scott is referring to is just an example of what is stocked in the stores. The MOU allows the city access 24 hours a day, 7 days a week to any Smart and Final store and to any product in the store if it is needed.
A MOTION was made by Councilwoman Scott, seconded by Councilman McCallon, to authorize the City Manager to execute the 2007 Disaster Relief Memorandum of Understanding (MOU) with Smart & Final Stores Corporation for emergency supplies during disasters. Motion carried, 5-0.
9. Donation of Two (2) 2007 Magnum Portable Light Towers to San Bernardino County Sheriff's Department
Councilwoman Scott inquired if the portable light towers will stay at the Highland station and if they are used by another city or by the county as a whole, will there be reimbursement paid to the city for use of the equipment.
City Manager Hughes responded the equipment was purchased by the Homeland Security Grant Fund. The city is temporarily donating the usage to the Sheriff's office. Once the use of the equipment is over, the equipment will return to the city and disposed of. In an emergency situation, if a city is need of our resources, we will certainly assist them and vice versa.
A MOTION was made by Councilwoman Scott, seconded by Councilman McCallon, to authorize the donation of two (2) 2007 Magnum Portable Light Towers (VIN #5AJLS16187B0071151) & VIN# 5AJLS16137B0071154) to San Bernardino County Sheriff's Department. Motion carried, 5-0.
10. Notice of Completion for Project Entitled "Highland Athletic Center Phase II"
Councilwoman Scott stated she would like to inquire if this project is 100% completed. The staff report shows it not being completed.
City Manager Hughes stated the status is down to minor punch list items and items in their maintenance period. For all intent this project is completed. This is a multiple prime contract and the majority of the contractors have been done with their portion for quite some time. There is one contractor who has a few more punch list items to complete, which is P.W. Construction. One suggestion is to release all the other completed subcontractors and hold P.W. Construction until they are completed.
A MOTION was made by Councilwoman Scott, seconded by Mayor Pro Tem Lilburn, as amended and will not release P.W. Construction until all items are completed; authorized the Mayor to sign the Notice of Completion for the project entitled "Highland Athletic Center Phase II"; directed the City Clerk to record the Notice of Completion with the San Bernardino County Recorders Office; and authorized staff to release the 10% retention funds 35 days from the recordation of the Notice of Completion. Motion carried, 5-0.
11. Bid Award - Project No. 2002-05 "5th Street Improvements - Palm Avenue to Boulder Avenue"
Councilwoman Scott stated this is strictly for four lanes.
City Engineer Wong responded correct.
Councilwoman Scott stated redevelopment bonds are also going to be discussed tonight and will the approval of this item hold us to just the four lanes.
City Engineer Wong responded no. This project is designed to allow for future widening to six lanes, therefore, approving this project does not in any way hinder further widening.
A MOTION was made by Councilwoman Scott, seconded by Councilman McCallon, to award the contract for Project 2002-05 "5th Street Improvements - Palm Avenue to Boulder Avenue" to RJ Noble Company in the amount of $1,549,622.45. Motion carried, 5-0.
CITY COUNCIL/REDEVELOPMENT AGENCY PUBLIC HEARING
12. Resolution No. 2007-020 Fixing the Highland Paramedic Special Tax Rate for Fiscal Year 2007-08
City Manager Hughes gave a brief review of the staff report.
Mayor Jones opened the public hearing.
There were no speakers.
Mayor Jones closed the public hearing.
A MOTION was made by Councilman Timmer, seconded by Councilwoman Scott, to adopt Resolution No. 2007-020 fixing the Highland Paramedic Special Tax rate for Fiscal Year 2007-08. Motion carried, 5-0.
RESOLUTION NO. 2007-020
A RESOLUTION OF THE CITY COUNCIL OF
THE CITY OF HIGHLAND, CALIFORNIA,
FIXING THE HIGHLAND PARAMEDIC SPECIAL TAX
RATE FOR FISCAL YEAR 2007-08
CITY COUNCIL/REDEVELOPMENT AGENCY LEGISLATIVE
13. Issuing Bonds for the RDA Projects
City Manager Hughes stated item 13 is a recommendation by the Public Works Subcommittee regarding the issuance of RDA Bonds for city projects. The total bond proceeds are expected to be approximately $30 million with net of $27,400,000 for Agency projects. We had a study session with the City Council back in December to discuss this issue. We also had a follow up study session with the City Council and with the development community regarding improvements along Greenspot Road. At that time this issue was deferred back to the Public Works Subcommittee and they have made the recommendation to go forward at this time with, for lack of a better term, other city related projects to fabricate the Greenspot Road at this time and to look at options such as a Community Facilities District, Greenspot Road improvements. Another option, which is not discussed in the staff report is doing an additional RDA bond with a future date once we know a little more about what's going to happen precisely down there on Greenspot Road. That's staff's presentation. We have Marshall Linn from Urban Futures here who is our special consultant on bond issues and he can answer any detailed questions you may have as well as Chuck Dantuono and Ernie Wong.
Mayor Jones stated in this project, Joe, would the ones that you have chosen as I at least reviewed from the Public Works agenda, what portion of those do we have revenues to repay the bonds for.
City Manager Hughes stated actually we can hand out what was given at the Public Works Subcommittee which may help with the discussion.
Councilwoman Scott stated is $30 million the maximum.
City Manager Hughes stated no it is not and Marshall can maybe elaborate.
Marshall Linn, Urban Futures, stated at the present time the Agency, if so, actually has the ability to do up to $37 million worth of bonds. According to the list of projects, he would think that it would be appropriate to issue the bond of $30 million which would net the Agency $27,400,000.
Councilwoman Scott stated so actually $37 is our max.
Marshall Linn stated at this particular time given the amount of property tax flowing into the Agency, $37 is the maximum amount.
Councilwoman Scott stated then how much would the Agency actually realize out of $37 million.
Marshall Linn stated if the Agency issued $37 million, the amount on the bonds would be $42 million, the net to the Agency would be $37 million. To net $27 million, the amount on the bonds would be $31 million.
Councilwoman Scott stated if $30 million, we net $27,400,000, at $37 million we would net what.
Marshall Linn stated if you issue $42 million, if the Agency wanted to net $27 million, the amount of bonds issued would be $31 million. Don't forget, keep in mind now, that the dominant share of that differential goes into a reserve fund that the Agency holds and assuming that fund is not tapped that becomes a last payment on the bond.
Councilwoman Scott stated she guesses she is confused because the staff report says, okay, the $30 should be a $31 on the staff report.
City Manager Hughes stated if the Agency wanted to do a $37 million total, what would the net be approximately to the city.
Marshall Linn stated $37 million probably approximately, probably about $31, no wait a minute, $37 million probably going to be about $33, $34 million. That's a real approximation.
Councilwoman Scott stated we have so many projects that we need to really get on in order to get development that is going to bring the dollars back into the city to pay off the bonds, it costs us every time we refinance. I mean when you refinance your home it costs you so much every time and rather than going for an amount to just get this done and then you know, three, four years later coming back and paying a large amount to refinance again. She calls it refinancing. She'd rather go for the whole hog all at one time.
Mayor Jones stated he thinks that is truly a good representation because the thing that happens that makes RDA's work is that you have to have a tax increment increase to repay the bond or you're just going in debt and not getting anything.
Marshall Linn stated that is not true.
Mayor Jones stated that is not true, you're going to give these to us for free.
Marshall Linn stated no, that is not the case. You actually have the increment right now if nothing else was ever built within the project area. You have the increment right now to promptly pay for the debt service on the bonds if nothing else happened.
Councilman Timmer stated the $31 million.
Marshall Linn stated that is correct.
Mayor Jones stated from the current revenues that are coming in from the increments that are there now.
Marshall Linn stated that is correct.
Mayor Jones stated and to pay for what level.
Marshall Linn stated right now you have enough increment, at this particular time, to issue up to $42 million on bonds and to net you $37 million. You have the increment to cover that if you so chose to. Please keep in mind that we have a three-year expenditure limitation that we need to be inside this bond issue to pretty much match up with the ability of staff, engineering staff, contracting staff and so on. To spend the $37 million within the period of 36 months.
Councilman McCallon stated the Public Works Subcommittee took a look at this and the reason we recommend moving this thing forward with the projects that are there because the other things along Greenspot Road have not been well defined and the costs have not been really put together yet. We've asked the developers to do that. As yet they have not come back with anything to us. It's been three weeks since we asked for that and nothing has come back to us yet. The issue about the bonding, the increment we have now is increment that's been generated from the existing Redevelopment Agency, not any of the development that we're talking about on Greenspot. That increment, the Public Works Subcommittee feels, should be put toward projects that would benefit the existing community and that's what this project list is. Since we felt the cost for the Greenspot Road was going to be outside the bonding capacity that we have right now, our Bond Counsel recommends one thing we could do is go either for a CFD, which allows us to bond against the tax, the CFD tax and be able to reimburse the developer out of the increment based on them, meeting some performance parameters which we mutually agree on. Those parameters could be occupancy, could be sales tax, could be whatever we mutually agreed upon and then if they met those performance parameters then what they paid in the tax on the CFD would be reimbursed out of the tax increment. We thought that would be a win-win situation way to go on this and that's why we recommend the move forward with the current $27.5 million and put this other together and cover the overall cost.
Mayor Jones stated he thinks the direction of the Council at the last Council meeting was to go back to the Public Works Subcommittee and include the Greenspot project within that consideration and we were given the infrastructure costs for improving and doing all the work that was proposed for that including the storm drain, the landscape meridian, the traffic signals, the undergrounding and everything else and it came in to be around $11,373,000 and then there was a differential cost between, of course, whether it be underground of your overhead and that was another $669,000 involved in that and which depending on whom you're going to allocate those costs or who you're not going to. He would propose because this particular area is in fact the crown jewel of the City of Highland that we need to make an investment in it to make sure that we are stepping out front and saying we want this to be our crown jewel.
Councilman McCallon stated he does not disagree with Mayor Jones. All of us agree with that and our proposal doesn't say anything about not agreeing with that, we're just talking about the way of finance.
Mayor Jones stated he understands that but he thinks the timing is the critical issue. All of the developers who are there currently, who either own property or will own properties, in fact are saying that they want to move this project forward and they're looking for some direction from us to be able to do that.
Councilman McCallon stated as he has said before at our Public Works Subcommittee, we asked the developers to provide us with something and they said they would. They have not come forward with that at all. Now if they are interested in moving forward on an expedited time table, you'd think they give us what we asked for.
Mayor Jones stated what did you ask for.
Councilman McCallon stated to come back with costs, what they think they would need for the . . .
Mayor Jones stated we have those costs.
Councilman Timmer stated no we don't. They added additional things at the meeting they would like to fund. They seem supportive in a process we chose to go forward with as a recommendation. They seem to think that was an appropriate way to go. They just needed to crunch some numbers and get additional time to do that.
Councilman McCallon stated we have a letter from all three of them saying that this CFD approach is one that is acceptable.
Mayor Jones stated he does not think this is true, at least in his conversations that he has had, and he's not saying the vehicle is not the correct one.
Councilman McCallon stated we have a letter signed by all of them.
Mayor Jones stated okay but a number of months ago he asked them, all of these developers, to get together and decide on or at least give some input as to what their projects were going to be and how those projects would fit into the infrastructure that may need to come into play in relationship to that.
Councilman McCallon stated they haven't come forward with that.
Mayor Jones stated they did.
Councilman McCallon stated again they did not.
Mayor Jones stated it's right here.
Councilman McCallon stated not in our Public Works Subcommittee meeting.
Mayor Jones stated again it's right here.
Mayor Pro Tem Lilburn asked were they invited to the Public Works Subcommittee meeting?
Councilman McCallon stated absolutely.
Councilman Timmer stated they were there. Mayor, if you're going to give direction without the Council, you asked this to go back to the Public Works Subcommittee. We looked at the options, staff gave us some options of what would work with the developers. They seemed agreeable. They're going to provide us that information and we didn't want to delay getting some infrastructure put into the city, parts of the city that have not had infrastructure in years. We felt this was a good way to get the thing started. They seemed agreeable with the CFD process. It was something they could work with. They just needed to crunch some numbers to get back to us and that's pretty much bottom line and we came back to the full Council with a recommendation.
Mayor Jones stated this is simply a design and some ideas. It is not a proposal or anything of that type. It is simply a design that be built or could be built if we would take the leadership role to do that. Basically what we have here is the freeway going here, this is in entrance into the Greenspot corridor. This plan needs to become ours. It shouldn't be the developers, it should be ours because this is the crown jewel that we want to develop and, therefore, we ought to be able to take the lead and decide what that is.
Councilman McCallon stated those are design guidelines. All of that paper is design guidelines. It has nothing to do with the infrastructure. He agrees we need to come up with design guidelines for that corridor but that is a separate issue from the infrastructure.
Mayor Jones stated it isn't a separate issue, the design is the infrastructure.
Councilman McCallon stated he understands but this is one developer's concept on the design guidelines and he would be more than amenable to direct staff to come up with some design guidelines working with the developers.
Mayor Jones stated that is one of the problems the developers have had is that we have not provided that guidance.
Councilman McCallon stated well we can do that now.
Mayor Jones stated okay, that's what he's saying.
Councilman McCallon stated design guidelines, work with staff to come up with some design guidelines.
Mayor Jones stated now this proposal, of course, shows for sidewalks on the north side and landscaping of being about 25 feet wide and the other parts that go along with that, landscaping and sidewalks and everything else. The same thing the developers on the south have proposed only 15 or 17 feet. He's not sure. He couldn't quite scale what that was but he thinks at least, as far as the project coming from the City of Highland, we ought to make both sides the same. Then you would have these typical pod areas which they have outlined here, which would consist of some block walls, a pilaster and then a concrete bench that would be along there and they would appear at various spots there. You would have, of course, the signal light which would then allow entrance in and out of the projects on both sides, another signal light as where Ernie has already outlined the footage on those and he's assuming that's the scale for those and if it isn't, that should be changed and then of course an In-N-Out depending upon what projects would or would not develop there. Moving over here, you would have the same type of an entrance coming out of Redlands into Highland on Boulder so that very definitely when you reach this point you would in fact see a change in the road scape and know that you're moving into and experience a community, a town center if you will, that would in fact determine that this was different from an ordinary road that you're driving on. Along Boulder here, this would be the re-change of the signal off of Webster changing it to go directly into the project and then the redesign, of course, of Webster so that there's only a right turn out of that project. Each of these areas, of course, are definitely identified with cobblestone or brick or whatever so that you make a transition across the entire road not just on the sides thereof and then you, we can go on and talk about many, many others. His concern is it doesn't go far enough. The area we ought to be including, as a project, is the entire area in the Golden Triangle and that basically goes here. If you come up Boulder to the wash and then back down the wash to the freeway and then back along and pick up this. We have flood control property here that needs to be taken into the project and considered as part of this entire crown jewel. If we fail to develop that piece of property then in fact, we failed to support the entire project as to what it should be included within that. We also have another piece of property, he's told, on the south side right next to the mini-storage that Marie Tobin owns and she has not been, she's been talked to but not willing, of course, talk about sale or including that in that. It would be a disaster if we allowed this project to move forward and not include that in the project and develop at the same time the rest of the project is developed. Now that all being said his proposal would be to expand and add this project area to the bonding so that in fact we can have the resources available and the financing to be able to develop and do this entire design, whatever the city wants and include within that. The area that he mentioned up above, the flood control property, that is an open space property that will always be open space unless we design it as an open space park and include it in the project and blend it in so that it's usable, it's accessible. Many of our citizens are currently using it with ATV's and other things as they ride those mounds in and out of the sagebrush and other things that are there but it needs to be included. We need to have a plan and we need to move forward now, not later. The urgency of this is really on top of us. To wait any period of time or to postpone this to a later time is assassination on our point because what we're doing is telling developers we don't really have an interest in your project. We don't have an interest in taking a lead position and creating a project design of what we, the City of Highland, want and therefore they may lose interest and go elsewhere. They may decide not to build because we just can't seem to get this all together. It would be his proposal that we, in fact, include this project area, all of the area, in the current bonding considerations and move forward with that to include the improvements that are necessary in the financing to be able to do these projects.
Councilman McCallon stated he does not think any Council Member disagrees with you that the importance of the Greenspot area. Everything you have discussed, he thinks is something, other than the park issue on the flood control land, is something that we've all wanted and so on. All we're talking about is, we are planning to move forward, all we're talking about is fabricating, doing this current issue and then getting the rest of the stuff put together. The development community is ready to move forward, he hopes, the city is too. He agrees with Mayor Jones that we should direct staff to do some design guidelines for that corridor and this is a good start to look at. It would probably take four months or so to put that together and he has no problem with that. He is opposed to delaying this bond issue for this inclusion and expanding it and he will vote against it.
Mayor Jones stated he is not proposing to delay it. He is proposing to expand it. Marshall, if we were to expand this at this time to the full limit of our bonding capacity, what would that entail?
Marshall Linn stated at the present time, again, bonds are sold only on the pretense that you have enough increment now to pay for that increment, to pay for the actual debt service, you have the ability to sell bonds today and it would net you approximately $37-$38 million and that's a Council vote but you do have that ability at this time.
City Manager Hughes stated he would like to point out what we're talking about here, what's on that drawing up there, will be more than $10 million.
Mayor Pro Tem Lilburn stated she thought it would be around $14 million.
City Manager Hughes stated he thinks that is a number that was thrown out by the development community at a study session if they were to include Boulder and he does not want to have a preconceived notion that if we did go for the maximum amount that we would have enough funding to do all those things.
Mayor Jones stated he is not proposing that would in fact do that. What he is saying that we could put the project in there, we could have the financing available to begin those, you know, additions and improvements to the area, the developers would be allowed to, in fact, put in their sidewalks, put in their curbs and gutters and then come and get credit for those improvements that they're making to the corridor and to the area that's in the project.
Marshall Linn stated maybe a good compromise here would be to do this. It would be to issue bonds right now in the lesser amount and come back because number one the comment was made, yes it's an expensive process to issue new bonds but the most expensive part of the new bond issue is the underwriter's discount and let's assume that the discount is $10 a bond. Whether you sell $10 million worth of bonds or $100 million worth of bond, it's still $10 a bond. That's the most expensive part of issuing bonds. The other cost, legal costs, our fees and so on are somewhat similar and significantly less than what the underwriter as to what you have to pay. Maybe an appropriate method would be to issue the smaller amount of bonds now, work with all the firms, such as all the firms that are interested in building in the Greenspot. On a very preliminary basis, extremely preliminary because we have not received hard numbers, he thinks we can raise through a CFD approximately $5-$6 million. That's $5-$6 million less that the city has to issue. If there's a short fall, if that doesn't cover all the improvements that you may want two to three months from now, we could go back very easily and issue another small tax allocation bond to make up that difference.
Mayor Jones stated well the urgency or the reason that we want to move ahead on the bonds now is because of the interest rate. Why would we want to wait and do those bonds later, maybe at a higher interest rate, which would incur additional costs in the total cost of the repayment of those bonds?
Marshall Linn stated he cannot give any advice on interest rates. There are only three things interest rates can do, go up, go down or stay the same and you're absolutely right we are at a very great time right now but he can't tell if interest rates will go up in two months or go down, he doesn't know. He does think that maybe the compromise that he outlined would get you to where you want to be but probably at $4-$6 million less of your own money. His own personal feeling is that the developers should pay for most of the infrastructure. If we sat down with them, formed a CFD, let's move ahead and we can go ahead and reimburse you for the special taxing and property if you meet certain criteria which we have to enumerate and they all said yes, that sounds like a very excellent plan. We have not received any numbers from them. When they do give us numbers, we'll sit down and meet with them again. He doesn't vote on the Council but he thinks we can save $5 or $6 million, monies that can be put into other projects that benefit everyone within the City of Highland. That might be a very excellent compromise.
Councilwoman Scott stated but does the difference between $5 and $6 million and adding $10 million now at the low, low interest rate that we're trying to go for right now.
Marshall Linn stated he thinks there are two issues on the table. He thinks one issue, if he hears things right, is how much public assistance that you're going to give out as an Agency Board to the individuals that are going to build that project.
Mayor Jones stated we are not providing any subsidy, we are not providing any incentive to them. He is not proposing that at all. He is simply proposing to set up a financing device by which we can get together with the developers and discuss who can build these and whether there will be financing available to do that and a reimbursement if they do it or if we have to do it.
Councilman McCallon stated he thinks that's what Marshall Linn's outline was.
Mayor Jones stated he understands but he is not willing to pass a Mello Roos for this project. He just is not. Mello Roos to him, everyone that he has been a part of, has been a disaster and that's what Marshall's proposal.
Councilman Timmer stated there's two issues that's really in front of us. One is that when the Public Works Subcommittee based on Council direction, we looked at the projects that we could adequately handle with staff and hiring consultants to do that. That's where we came up with that money. Staff said they can do that. The other is we, he thinks Marshall pointed out, we have basically on redevelopment loans three years really to spend the money. If you don't, you end jeopardizing the bonds and have to pay back and some other issues. So, if we pile another $14 or $15 or $16 million of bonds on top of what were asking, really what were saying is that were now on the very upper limits of what our increment can pay back and any other projects for the next foreseeable future will there be no funding. Basically we'll be at our spending limit and we'll have no discretionary funding to do other emergency things that we may want to do in the city to use the redevelopment dollars to do any additional streets or a park or whatever we want to spend. We won't have any discretionary monies left if we go this direction and basically saying every dollar we have in increment is going to pay back some bonds that we may or may not be able to spend all that money within the next three years which creates other legal issues but his concern is that we then have no ability, as a City Council, if something comes, if some developer comes to us with another project that's good for the city, we have no discretionary dollars to do any of those things anymore. We are encumbering basically all of our increment to these bonds.
Mayor Jones stated there is no question in his mind that we would be able to design, build and provide this entire infrastructure in the next three years if the City of Highland did all of it.
Councilman Timmer stated but we also have another $27 million worth of projects we felt were important also for the existing people that are living here. People on the west side of town that haven't had a curb, sidewalk or a storm drain for all these years, that's where the money was going to do that. This is a project that's going to help development, which will hopefully help the city to create shopping and so forth, but he is concerned we'll have no discretionary dollars. If someone wants to come into the town center and needs some assistance, that money will not be available to do that.
Mayor Jones stated let him explain the discretionary dollars that Councilman Timmer is talking about. This project alone, on both sides of the street, these developers are talking about spending $660,000,000 plus. Talk about tax increment, talk about increased increment that we can be able to spend, Marshall, what would that do for the bonding capacity or the RDA in the City of Highland.
Marshall Linn stated basically the maximum would probably be around $150 million. That would probably give you bonding capacity to raise another $10-$12 million.
Councilman Timmer stated the issue, really to him, is that's betting on something that is going to happen. We've been talking about the project at Highland and Boulder creating increment for us for four, five years, nothing is being built. We can go and put all this infrastructure, if the developers choose not to or for whatever economic reasons delay the building, we're now basically saying we're going to be having future increment that may or may not come in to help pay the bonds. He does not feel comfortable borrowing money based on income that may come in or may not come in, hopefully it will but if it doesn't develop, something goes sour, they find another endangered species that will have to take another four years to review, we're in trouble. He is not going to jeopardize the fiscal responsibility of the city by saying we're going to borrow money on money that we do not have coming in yet. He has a problem. In fact, he does not like bonding at all. He thinks most folks know that but he does not have a problem bonding to a certain level with an income that we have today. The old story, don't spend more than you have in income but we're going the opposite. We're going to spend more than we have in income if this doesn't develop.
Mayor Jones stated that is not true.
Mayor Pro Tem Lilburn stated she has a few comments on this whole situation and she's not sure if Marshall was present at the last meeting but she thought it was clear that we all agreed that we were given direction that we were going to help do some infrastructure support in the Golden Triangle because it was an opportunity to give our residents a chance to do some retail shopping here and that was the direction that we were given or that we gave. The Public Works Subcommittee was going to come back with a recommendation but on the recommendation she sees that we have a CFD and she does not know how that played into work. She knows we talked about several projects and we had these other projects that we were for sure going with and so she guesses that we're probably at a spot that we need to come to some kind of happy medium. Are there some funds that we can spend that we know we can spend within the three years that's going to help with the infrastructure and that we can do this in a phased situation? She thinks the goal was to make sure that the developers knew that we were on board with this project and that we supported them and that we were going to work as a team in order to improve that Golden Triangle. That meant a lot to us and that we really were going to invest in it.
Councilman McCallon stated the Public Works Subcommittee made that point.
Mayor Pro Tem Lilburn stated she understands and she thinks where we're falling down here is she thinks the developers should have been there with the subcommittee so they could have given you some clear direction so we wouldn't be here and that our Mayor has some clear direction but if the Public Works Subcommittee doesn't have the clear direction . . .
Councilman McCallon stated Public Works had clear direction, the developers were there, they agreed that they were going to come back with some numbers and we would, with Marshall, we'd put together a proposal.
Councilman Timmer stated they were all present at the meeting except for one developer who wasn't present but all of them were there and they said this sounds like a good process to go through.
City Manager Hughes stated there were two separate Public Works Subcommittee meetings and between the two meetings various developers attended. Some couldn't attend one, some couldn't attend the other but between the two meetings, there was attendance by, he believes, the majority of the property owners.
Councilman McCallon stated we're all saying we're all working together, we all agree we need to move forward, we're ready to do that. We're just waiting for the developer to come back with the information that we asked for.
Mayor Pro Tem Lilburn stated in the mean time what's going to happen. Are we willing to add that into the bond?
Councilman McCallon stated the reason we recommended moving this bonding forward is because this other thing was being delayed and we thought it was important to get this started and we can do additional bonding for whatever or a CFD, whatever we come up with.
Mayor Jones stated timing is critical. We have this Citrus Plaza to the south of us who in fact is in the process of expanding their facilities.
Councilman McCallon stated he agrees timing is critical but the developers didn't respond like they should have.
Mayor Jones stated that problem is at the RDA. We have put the cart in front of the horse. We need to take the RDA back and put the horse in front of the cart and take the leadership responsibility here to plan the community that we want. That's what RDA's are for. They are to plan the community that you want and then to reach out to developers to participate in that. We have not taken that position as an RDA and he proposes that we take the position.
Councilman McCallon stated he disagrees with Mayor Jones.
Mayor Jones stated okay, show me where we have, where have we taken the leadership position and given them the design, the outline and the things that we need to make this work.
Councilman Timmer stated one thing we changed the general plan to address many of these concerns so that as they develop the general plan already considered many of those infrastructure needs. We certainly looked at the town center with a new concept to the general plan and that's going to have some demand on redevelopment dollars at some future point. We came back with an option, he thought was a good option, the developers seemed to think it was okay that didn't put the city in jeopardy of spending more than we have. To me that's the key.
Mayor Jones stated Marshall has already told us that we can bond to our full capacity of $38 million and it would be covered by that with which we already have, so that's not a good excuse.
Councilman Timmer stated no, because if you add up the numbers, $14 million I'm sure, they threw $11 million out at the study session, they came up with some other projects, they want to put gas pipe lines in now with additional undergrounding, so we're probably closer now if you want to put all these gingerbread things that you're talking about in there, we're talking $14, $15 million. If you add that to what the Public Works Subcommittee and this Council has already gone on recommendation of supporting the other $31 million in projects, you add those two together, we're above the bonding capacity that Marshall said. So, we're borrowing money that we have to pay back with monies that we don't have at this point.
Mayor Pro Tem Lilburn asked Marshall when we're bonding $30 million and we're only netting $27 million, where does the additional $3 million go?
Marshall Linn stated the dominant share of this spread between the bond and the net on the bonds goes to a fund, a reserve fund, that you are mandated by the bond holders and the insurance companies that will secure these bonds. It sits there in case there's a drastic turn around in increments within the Agency, there's money to cover the debt services for an extended period of time.
Mayor Pro Tem Lilburn stated so then like for payments and things like that. So, we're bonding and a piece of that bond portion is to cover a piece of insurance.
Marshall Linn stated for instance if you needed to net $27 million, the bond would be approximately $31 million.
Mayor Pro Tem Lilburn stated so, we're only really bonding $27 million.
Marshall Linn stated no, you're taking $31 million, you're netting $27 million but of that total about $1.8 million goes into this fund. That fund for a period of 30 years is investing in a major bank and just sits there, assuming that you don't ever have to use that, that nothing goes wrong, that becomes your last payment. So, at the 29th year you simply draw out of that money and make your final payment.
Councilwoman Scott stated it's gaining interest all that time, right?
Marshall Linn stated it earns interest and right now the rates are at a level where we can invest that money at the same deal as the bond.
Mr. Glenn Elsmann, Mission Development, stated he really appreciates all the dialogue and the discussion here tonight. He is hearing a lot of positive things about where people's goals and directions and visions of what can happen for the community particularly within the Golden Triangle but outside of that the investment into the existing community as a means of enhancing and making the rest of the community grow. He does not think we are up against an either or situation here at all. He is not hearing anybody suggest that the work the infrastructure committee and the list of projects that are generated would be excluded from this discussion or what is being contemplated nor is he hearing that and maybe there's some point of clarification that he did some observation that might help the discussion. Nobody is suggesting that the bond be higher than what your current capacity is. There are going to be, when it's all said and done, there are going to be far more costs associated with the vision of the Golden Triangle on the north and south side than what this bond capacity would be or what even future CFD's would be. So that's what he thinks is important in the discussion to focus on is what is the vision and the goal of what the city would like to see from an infrastructure point of view. What level of quality, what level of statement, what kind of community do we want the citizens of this town to have as it relates to maximizing the value for the community within the Golden Triangle. Part of the logic of perhaps making use of the additional increment and maximizing the bond capacity today relates to the issues that are being talked about with timing. There are critical infrastructures that it seems like, from a construction point of view and a traffic flow point of view and so forth that would be good to get in up front. None of the developers control the time of the other projects and what is going on and if you can get certain minimum basic things done seems like you're going to be further ahead that as projects come in these issues are addressed and handled down the road. The comment that Councilman McCallon has commented on, we have provided staff with a list of projects and some of the costs associated with those. We apologize if not all that information was readily available in time for some of those workshop issues. We have been diligently trying to put together some suggestions and ideas but by no means are we saying this is the way it should be but we want to be part of the vision of what can happen here within the Golden Triangle. We have some ideas that can benefit everybody involved. The other thing that he thinks is important here is Greenspot Road is not just for the benefit of the property owners on the north and south side. This is a gateway to the entire community. It is something that is going to be, that is going to last for decades and decades and what is that ultimately going to be become. We definitely see that it is going to be a benefit regionally for the city and for the region, not just any one particular project. We're not looking for a subsidy. These are huge infrastructures dollars that are going in, there are communities all over southern California that look to say how can we maximize our ability to compete in the marketplace and unlock the retail commercial development values. Go to Rancho Cucamonga, Victoria Gardens, the City of Rancho Cucamonga has made $100's of millions of dollars worth of investments to be able to do what it takes to create projects that people want to go to, that want to shop at and it's going to sustain and deal with the competitive forces that are in the marketplace today. That's just one example the list could go on and on. So, I think there's a win-win for everybody. The solutions that have been talked about in the infrastructure committee are ones that are part, this is a tool box, there is no one tool but to suggest that we have an opportunity to make a dent into the overall impact of what can go on here, that's what the discussion to me sounds like and is it okay to take, not over encumber, just do what bond counseling said. You can service the stead, it's not like you're going backwards with what you're doing. There's reserves and you have the ability to do it. His question is if you're not going to do that, what are you going to do with it? Put it somewhere else but if it seems like why not take advantage of it and allow good infrastructure to occur that will benefit the whole community. That's to me what some of this discussion is all about.
Mayor Jones stated and that's his issue entirely. The people of the City of Highland need entertainment, they need places to eat, they need places to shop, we need as the City of Highland to do something to guarantee the disposal income that is being spent out of Highland, which is 85% of all money that is coming here, is going outside of Highland and being spent. What are we doing constructively as an RDA to encourage money to stay here? By providing the shops, entertainment, recreation and other things that we need to keep it here. He would move that we include in the RDA project area, the Golden Triangle and increase the bonding to the maximum amount so we can provide for the City of Highland.
Councilman Timmer stated first he would like to know what that amount is. If we tie up every increment dollar coming into the city and that's what this is going to do if we go to the maximum amount. Now hopefully growth will occur but if it doesn't and during the early 90's it didn't, if we go into a period of time like that, we won't have enough, we won't have other increments to do some housing things that we're mandated to do, some of the other things that we've already putting work plan to redo some of the stuff along Base Line, those monies are now gone because they are committed to the bond if we go to the maximum amount. That's why we kind of chose not to go the full amount, something less that we can look at another option to get the vision that we want to get accomplished but still have some discretionary dollars to do some things that may come up in the future. He knows we all want to do some things along Base Line and that money is no longer there unless we borrow more money.
Mayor Pro Tem Lilburn stated when does this money need to be incurred by.
Marshall Linn stated the Federal Law states that not all the proceeds have to be spent. They have to be encumbered with projects and contracts within a period of 36 months. We will ask City Manager Hughes at the closing to sign a certificate stating that.
Mayor Pro Tem Lilburn stated we really, really need to think can we spend and she knows the intention is good and we want this, but we just need to make sure before we bond all this cause I know we were having trouble spending some of the current funds that we have right now. We need to make sure. She does not have a problem supporting this but she does not want to put the city in a position that we can't spend the money and we jeopardize not being able to spend those funds.
Mayor Jones stated he does not think there's a problem at all on being able to spend the money as he said. If the city took it on and did it themselves, we could spend the money in the three-year period of time. Doing these improvements, which would in fact, tell to the development community the City of Highland really is interested in making an investment in the community so that we can invite them to come here and develop ahead of the Citrus Plaza and to be able to get the tax dollars and disposable income being spent in Highland where the people need to be spending it in the community that they live.
Councilman McCallon stated we really need to consult staff to see if within the overall work program they can do what you say they can do. Second of all he does not believe anybody on this Council doesn't support the Golden Triangle. You are implying that the Public Works Subcommittee is not caring for this vision and he resents that because we do have this vision. We're just talking about how we're going to finance it and how we're going to make it move forward. We all want to make it move forward. We all want to make it forward expeditiously but we need to have a plan on how to do that. To sit here and say oh, we're going to bond for this much and the staff is going to do it and let's go ahead with it. Why do we have these committees if you want the Council to do all this work? Just do away with the committees.
Councilman Scott stated she seconded the motion simply because she knows that timing is of the essence. She can remember when Stater Bros. opened and one of the comments that Jack Brown made during the Grand Opening was now was the time and again, Citrus Plaza is expanding and if we don't get something on board here in Highland we're going to lose that opportunity. She doesn't like debt any more than anybody else here but sometimes you have to bite the bullet to get it kick started, jump started. It's not just that development project. It's Greenspot even getting onto the freeway, if anybody has driven that road that's a disaster, especially in the morning and it's going to get worse.
Councilman Timmer stated the reason we haven't done that and you were on the committee are the environmental issues that jump through all those hoops. We finally got through to that and we're going out to bid or we awarded the bid tonight to do that project.
Councilman Scott stated she knows the Wooly Star and the Kangaroo Rat, they really hold up things on a lot of projects. She thinks we need to go forward with this.
Mayor Pro Tem Lilburn stated she is still not clear on the amount being asked for.
Councilman Timmer stated he would like to know where we volunteering to tie up our increment for the next 30 years and what the amount is. He has a little concern. He mentioned $41, $38 million, he mentioned a bunch of numbers.
Marshall Linn stated the maximum bonding capacity you have would be $42,770,000 which is subject to change tomorrow morning with interest rates; this is as of today. That would net you a rounded up figure of approximately $38,000,000. Public Works, after we met a number of times going over projects, recommended course of action was to sell bonds that would net you approximately $27,400,000 which would be a paramount bond of approximately $31,000,000 so let's make sure we understand the $42,770,000 or $43,000,000, that's maximum paramount bond we can sell today is 125% coverage which means for every dollar of debt we have, we have $1.25 coverage. We can do that on a fairly conservative bond. Keep in mind, again, the three-year rule we have to make the best faith efforts to spend those monies within three years. We have to have them appropriated. We have to have the funds appropriated and projects moving within the 30-36 months.
Mayor Pro Tem Lilburn stated she has a question for the subcommittee. This was not included, these funds were not included in these so we can come back and talk and re-bond. Why can't we do it all now? Did you discuss that?
Councilman Timmer stated because we did not have hard numbers to say what we needed. Every time the developers came they added more projects when the city opens its wallet. He would do the same thing. He's going to offer more parts on how to spend the city's money.
Mayor Pro Tem Lilburn asked did they add in more projects than the night we talked about at the study session.
Councilman Timmer stated yes they did.
Mayor Pro Tem Lilburn asked how much more.
Councilman Timmer stated we don't know. They wanted pipelines and other things put in.
City Manager Hughes stated at the study session we basically talked about Greenspot Road. He believes we talked about five projects: underground utilities, storm drains, widening of the road, median and the signal. What was added at the subcommittee was a gas line and now we're looking at Boulder Avenue all the way up which wasn't discussed at the subcommittee level.
Mayor Pro Tem Lilburn stated how much were the numbers did we have for the study session.
Mayor Jones stated $11,373,000.
City Manager Hughes stated he believes the gas line is about $450,000.
Mayor Pro Tem Lilburn asked did we get some hard confirmed figures? She knows we were throwing numbers out there. Do we have anything?
City Manager Hughes stated those were our best estimates but we haven't done anything formal.
Councilman Timmer stated also they left that part of the undergrounding along Boulder above ground and that was not included and we haven't talked about that as a dollar amount yet either and we also talked about the 66 KV lines that were not going to be underground and we felt they needed to be underground. So, there was a lot of budgetary dollar amounts that we couldn't say this is what its going cost us, this is what we want to bond for but we, as a subcommittee, felt we needed to move some of this development started, some of the infrastructure improvements on the west side of Highland, start now while these issues are being resolved so staff suggested the CFD process. The developers seemed to think it was a good way because they're going to get a rebate for the increment that they create based on some performance that they have. They seemed comfortable with that and he didn't particularly want to tie up every increment dollar we have for the next 30 years without having some other because there are other things that we as a Council want to do in this city.
Councilwoman Scott stated but the projects on the west side, they are already in progress and they already in.
Councilman Timmer stated a lot of the funding wasn't complete for a lot of those projects as well and that's why you see some of them funded with zero dollars and others. Those are all projects that we identified that were important to the west side of Highland.
Councilwoman Scott stated there are a lot of them where the additional RDA funding required as zero so the funding is there now. There are projects already that are in progress. Here's a whole page in progress.
Mayor Jones stated let's take into consideration of what we're really doing. The $27 million you're talking and proposing to spend there are going to provide for bridge expansion, sidewalks and gutters. Not one nickel of that is going to go towards an investment in the community that will raise the tax increment. Are we saying that we want to spend that money but we do not want to invest in the development community?
Councilman Timmer stated that is not what we said because we came back with another alternative of looking at options that the developers seemed to feel was a good approach so this was just the first part or first phase of what we thought we needed to do.
Councilman McCallon stated it has been successfully implemented and worked in another community.
Mayor Jones stated he understands. It's easy to say that we can go put a Mello-Roos in there and pay for these expenses. He's not willing to put another Mello-Roos in this community.
Councilman McCallon stated but it's reimbursable out of the increment.
Mayor Jones stated you do not have to explain the positives to him. He understands the process.
Councilman Timmer stated you have approved other Mello-Roos in the city.
Mayor Jones stated he has approved and hated every one of them and he will go on public record to say that. So, what we're saying is we want to make an investment in our community so that we can shop here, so that we can be entertained here, so that we can, in fact, go buy clothing and go to a show or the other things that we can do here. That's the investment we're making.
Councilman McCallon stated we don't disagree with you. We're just talking about how to get there.
Mayor Jones stated okay, that's what we're trying to create here, a process by which that can take place.
City Manager Hughes stated he wants emphasize one more time so that we're all very clear, what we're talking about even if we go up to the maximum amount of the $42 net, $38, that's going to give you about $10,000,000 more. That's still not enough. Just so you know it's still not enough to do all those items and the other things that we've talked about.
Mayor Jones stated that is correct. We have not discussed whose going to pay for it. Whether this is going to pay for it or it's just going to be a financing device to assist the developers in doing it and then be reimbursed for that. We have not discussed that at all.
City Manager Hughes stated right. He just doesn't want anyone to come away with the idea that this additional $10,000,000 is enough to fund everything we talked about. It's not.
Mayor Jones stated we need to also to take into consideration that this is sustaining the philosophy we've always had of the city is to pay as you go. We have got in place the funds to be able to pay for that and we're not spending beyond our income.
Mayor Jones called for the vote.
Councilman Timmer stated we still don't have an amount.
Mayor Pro Tem Lilburn stated she wants to support this project.
City Manager Hughes stated the maximum amount is $42,770,000 with a net of approximately $38,000,000. We still have to come back at the next Council meeting with the resolution and all the paperwork to actually go forward with the bond.
Mayor Pro Tem Lilburn stated during this time, she would like to see our work program to see if we have the time. She'll support this item tonight but she would like to see on the next agenda that we have the time frame in order to spend the money and that we do have a project list and the accurate prices.
Councilman Timmer stated he would like for everyone to be aware if we go forward with another $14,000,000 we have to recognize we're going to have to hire a lot more consultants to get this stuff through and he knows we're all concerned when we hire more employees. So be aware, up front, engineering staff is going to have to be hiring more consultants to do a lot of preparation and engineering work because we don't have the staff to do it.
Mayor Jones asked do we know how many jobs these developments will bring to the City of Highland? Those are jobs. Let's not argue about those but also the ones that propose in the commercial. We're going to bring 600, 800 new jobs to the City of Highland. Nothing we've ever done has brought that number of jobs to the City of Highland.
Councilman Timmer stated we're not against this project.
A MOTION was made by Mayor Jones, seconded by Councilwoman Scott, to include the Golden Triangle project in the RDA project area and to increase the bond the maximum allowance of $42,770,000 with a net amount of $38,000,000. Motion carried, 3-2, with Councilman McCallon and Councilman Timmer dissenting.
Mayor Pro Tem Lilburn stated she will support this tonight with the provision that when the developers come back they need to have hard figures for staff and she'll support it right now and she won't support it if they don't have it at the next meeting.
14. Assembly Bill 538 (Emmerson) Sales & Use Tax Exemption
City Clerk Hughes gave a brief review of the staff report.
Councilman McCallon stated as a member of the Kiwanis Club of Highland he would like to excuse himself from the discussion of this item.
Councilman Timmer stated he will excuse himself as well since he is also a member of the Kiwanis Club of Highland and will not participate in the discussion.
Sue Hulse, Kiwanis Club of Highland, gave a brief presentation of their request.
Councilwoman Scott stated she has concerns. She feels the lawmakers need to spend time and energy on issues for the whole state and for all of the people. There are many non-profit organizations and if one organization is given a no sales tax prerogative, she thinks it opens the door for all the rest. When there are special drives for clothing, the stores already give large discounts which are usually more than what the sales tax would be.
A MOTION was made by Mayor Pro Tem Lilburn, seconded by Councilwoman Scott, to not have the City of Highland take a position regarding the request from the Kiwanis Club of Highland, Inc. Motion carried, 3-0, with no participation from Councilman McCallon and Councilman Timmer.
Mayor Pro Tem Penny Lilburn left the dais at 8:00 p.m.
15. Consideration of Adoption of Resolutions of Necessity for the Acquisition by Eminent Domain of Certain Real Property Interests for Public Purposes in Connection with the City's Proposed Widening of Victoria Avenue Southbound to the Intersection of Highland Avenue
City Engineer Wong stated you have a very detailed staff report with all the attachments that provides you the information needed for you to make finding to adopt a resolution of necessity related to acquisition of some easements and constructions easements in relation to the construction of city improvements at the northwest corner of Highland Avenue and Victoria Avenue. He is not going to get into the detail very much but he just wants to quickly point out a few things. In order for you to fully visualize the project and the area that we are acquiring the easement with. Turn to page 16 of your staff report. There is a drawing that shows the proposed project. The City of Highland is proposing to improve the northwest corner of Highland Avenue and Victoria Avenue by constructing a southbound right turn pocket on Victoria Avenue and constructing curbs, gutters, sidewalks and paving on both Victoria Avenue and Highland Avenue at the northwest corner. You may also see that on the drawing there's also some proposed work on the south side of Highland Avenue that will be done by the City of San Bernardino as a separate project. Highland's project is only pertaining to the northwest corner. If you look at the next page, 17, you see four parcels. On the left side is parcel 11. That is an existing commercial building. The current use of that building is a pawn shop. At the corner of Victoria and Highland Avenue, parcel 9, is a gas station. North of that is parcel 8, an apartment complex. Actually 8 and 10 are both being used as the apartment with the building on parcel 8 and parking area on the north half of parcel 10. Parcels 8 and 10 are for apartment use but the south half of parcel 10 is vacant although it is part of the use for apartments. You have an aerial photo on the next page, on page 18, that shows these various properties. The city has contacted the property owners of these parcels to acquire a street and drainage easement along Highland Avenue and along Victoria Avenue. In addition to that we have also contacted property owners for acquisition of a temporary construction easement which would only last for twelve months or less depending on the length of construction period. The city had an appraisal done for these easements and has offered in writing to acquire these easements based on the value established by the appraisers. The reason that this item is put before you is to have the acquisition process go along so that it can fit the construction scheduled. This project is funded by an Indian Gaming Grant and it has a funding deadline of October of this year. That's the time line we have to meet. In order to fit that time schedule so that we don't lapse in terms of performance, we're asking that the Council consider adoption of this notice of resolution of necessity. This is the first step, the first legal step, that the City Council took in order to authorize the City Attorney to continue with the process, if necessary. It is the city's intent to continue to negotiate in good faith with the property owners and we had good meetings previously and will continue to do so. This meeting, however, does not deal with the amount of compensation because that is a subject of negotiation and further appraisal especially for the gas station. That is a subject for future determination. Tonight, what the Council is requested to do is to review the information before you and to open the meeting for public comment, listen to public comment and after that consider all the findings and consider adoption of the resolution of necessity. In order for you to adopt the resolution of necessity, there are four points you have to find that if it is met affirmatively. One, that the public interest and the necessity require the project. Two, that the project is planned and located in the manner that is most compatible with the greatest property and least private injury. Three, that the easements described in the resolution of necessity are necessary for the proposed project and finally, four, that the city has made an offer according to the California Government Code to each of the property owners. The Council is asked to consider each resolution of necessity individually and in fact if you find any findings it is affirmative that you adopt each of the resolutions by a 4/5 vote. He understands one of the property owners and his legal counsel is in the audience and they have requested that they be heard.
Mr. Roger Walker stated he is an Attorney for Victoria Services, ARCO and Jhawar Enterprises. Mr. Jhawar is present and he will ask him to raise his hand. The proposal on its face sounds rather benign, however, we'd like to make a couple of points for consideration. The proposed construction is not a minor inconvenience to my client, it's not a short term disruption, it's not a temporary set back in which there will be reasonable recovery. Rather it will cause irreparable harm to the business. Some particular points to be made are fairly obvious. The construction as proposed would take out the island closest to the street, cutting the ability to access the station in half. There would be no access for parking fuel trucks to resupply the fuel tanks. As proposed the entrance and exits, one on Victoria and on one on Highland, trucks could not maneuver in this location. Finally there's a loss of three of seven parking spaces, where there are only seven spaces for the mini mart. There are some other points but he is not going to dwell on them tonight or discuss. It is their position that approval of this construction would put Mr. Jhawar out of service as this is his sole source of income to support his family. In essence, this would make it a situation where he would no longer be a viable commercial enterprise. He just wants the Council to consider that as they consider adoption of the resolution of necessity.
Mayor Jones asked for any additional speakers. Hearing none he closed the public hearing portion.
City Attorney Battersby stated we want to thank the property owner and his representative for their comments tonight. The staff report does set forth the detailed findings as to why the project is located in the manner most compatible with the greatest public good and the least private injury and these findings are and the basis of the findings as set forth in the record, the staff report and the resolutions you're being requested to consider tonight. As City Engineer Wong indicated, we would like you to separately consider each of the three resolutions which needs a 4/5 vote to approve them. You would need a unanimous vote tonight to approve these resolutions.
Councilwoman Scott stated Mr. Walker mentioned the availability of the tankers being able to refuel there. Is there going to be adequate space for the tankers to come in and refuel the station?
City Engineer Wong stated that issue has not been looked into yet and it will be as a part of the mixed appraisal which is the business good will appraisal. That appraisal will look at how this project will impact the business and what would be a fair compensation for that business.
City Attorney Battersby stated in addition and in response to the question, this is an unusual case because this property owner's predecessor developed the gas station property in the manner that used the southern most pumping island and used the city's right-of-way for access to that southern most pumping island. So in some way, the design of the gas station requires the use of city property which is going to determine this. City Engineer Wong stated correct. The issue of compensation is not before you tonight. What is before you tonight are these four items.
Councilwoman Scott stated she understands that but if there's a problem with being able to refuel and they have to move the pumps because it's already in our right-of- way. She does not want the city getting stuck for having to move the pumps.
City Attorney Battersby stated the issue of compensation is not before you today.
Councilwoman Scott stated we have to widen the street because if we don't it's going to be a pile up.
City Attorney Battersby stated that's the issue that's before you today.
A MOTION was made by Councilman Timmer, seconded by Councilwoman Scott, to approve Resolution No. 2007-021, a resolution of necessity which is to include an approximate 290 square foot permanent easement for public street and drainage purposes and all uses necessary or convenient thereto and an approximate 1,304 square foot temporary construction easement with a term of twelve (12) month on the real property commonly known as 26454 E. Highland Avenue, and identified as San Bernardino County Assessor's Parcel Number 0285-742-11 ("To Property"). Motion carried, 4-0, with Mayor Pro Tem Lilburn absent.
RESOLUTION NO. 2007-021
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HIGHLAND
DECLARING CERTAIN PROPERTY INTEREST NECESSARY FOR PUBLIC PURPOSES AND AUTHORIZING THE ACQUISITION THEREOF,
IN CONNECTION WITH THE CITY'S PROPOSED WIDENING OF
VICTORIA AVENUE SOUTHBOUND TO THE INTERSECTION OF
HIGHLAND AVENUE AND IMPROVEMENT OF HIGHLAND AVENUE
WEST OF VICTORIA AVENUE
(ASSESSOR'S PARCEL NUMBER 0285-742-11)
City Engineer Wong stated the second resolution deals with the gas station. That is Assessor's Parcel Number 0285-742-09.
A MOTION was made by Councilman McCallon, seconded by Councilwoman Scott, to approve Resolution No. 2007-22, a resolution of necessity which is to include an approximate 1,699 square foot permanent easement for public street and drainage purposes and all uses necessary or convenient thereto and an approximate 581 square foot temporary construction easement with a term of twelve (12) month on the real property commonly known as 26492 E. Highland Avenue, and identified as San Bernardino County Assessor's Parcel Number 0285-742-09 ("Jhawar Enterprise property"). Motion carried, 4-0, with Mayor Pro Tem Lilburn absent.
RESOLUTION NO. 2007-022
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HIGHLAND
DECLARING CERTAIN PROPERTY INTEREST NECESSARY FOR PUBLIC PURPOSES AND AUTHORIZING THE ACQUISITION THEREOF,
IN CONNECTION WITH THE CITY'S PROPOSED WIDENING OF
VICTORIA AVENUE SOUTHBOUND TO THE INTERSECTION OF
HIGHLAND AVENUE AND IMPROVEMENT OF HIGHLAND AVENUE
WEST OF VICTORIA AVENUE
(ASSESSOR'S PARCEL NUMBER 0285-742-09)
City Engineer Wong stated the third resolution deals with the apartment that has two parcels. Parcel Numbers 0285-742-08 and 0285-742-10.
A MOTION was made by Councilman Timmer, seconded by Councilman McCallon, to approve Resolution No. 2007-23, a resolution of necessity which is to include a permanent easement for public street and drainage purposes and all uses necessary or convenient thereto totaling approximately 1,286 square feet and an approximate 2,851 square foot temporary construction easement with a term of twelve (12) months on the real property commonly known as 6476 Victoria Avenue and identified as San Bernardino County Assessor's Parcel Numbers 0285-742-08 and 0285-742-10 ("Jhawar Trustees and Gardner Trustees property"). These property interests consist of an approximate 825 square foot permanent easement and an approximate 1,475 square foot temporary construction easement with a term of twelve (12) months on Assessor's Parcel Number 0285-742-08 and an approximate 461 square foot permanent easement and an approximate 1,376 square foot temporary construction easement with a term of twelve (12) months on Assessor's Parcel Number 0285-742-10. Motion carried, 4-0, with Mayor Pro Tem Lilburn absent.
RESOLUTION NO. 2007-023
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HIGHLAND
DECLARING CERTAIN PROPERTY INTEREST NECESSARY FOR PUBLIC PURPOSES AND AUTHORIZING THE ACQUISITION THEREOF,
IN CONNECTION WITH THE CITY'S PROPOSED WIDENING OF
VICTORIA AVENUE SOUTHBOUND TO THE INTERSECTION OF
HIGHLAND AVENUE AND IMPROVEMENT OF HIGHLAND AVENUE
WEST OF VICTORIA AVENUE
(ASSESSOR'S PARCEL NUMBERS 0285-742-08 & 0285-742-10)
16. Three (3) Appointments to the Planning Commission
City Clerk Hughes announced three (3) vacancies on the Planning Commission. There are seven applications before Council for consideration.
Councilman McCallon nominated the two incumbents and Tom Fujiwara for the vacancies.
Councilwoman Scott nominated Michael Willhite in addition to the two incumbents.
City Clerk Hughes called for further nominations. Hearing none, the City Clerk closed the floor for nominations.
City Clerk Hughes called for the vote for Richard Haller and John Gamboa.
Incumbents Richard Haller and John Gamboa received four votes and will be reappointed to the Planning Commission with terms to expire in May 2011.
City Clerk Hughes called for the vote for Tom Fujiwara.
Tom Fujiwara received two votes.
City Clerk Hughes called for the vote for Michael Willhite.
Michael Willhite received two votes.
City Clerk stated there is a tie vote.
City Clerk Hughes called for the vote for Tom Fujiwara.
Tom Fujiwara received no votes.
City Clerk Hughes called for the vote for Michael Willhite.
Michael Willhite received four votes.
Michael Willhite has been appointed to the Planning Commission with term limits expiring in May 2011.
17. 2007-2009 Preliminary Budget and Study Session Date
The Redevelopment Agency/City Council received the 2007-2009 Preliminary Budget and set May 23, 2007, at 10:00 a.m. as the Study Session date.
18. Update on SANBAG, SCAG, Omnitrans, Work Program and Regional/Legislative Issues/Development Issues/Subcommittees/AB 1234 Updates
Councilman McCallon stated SANBAG adopted a strategy for organizational realignment. Also adopted was the San Bernardino passenger rail short range transit plan which included the white rail between San Bernardino and Redlands and also the extension of the gold line out to Montclair. At the regional Council, a resolution was adopted asking the President and Governor to declare a state of national emergency relative to the 2.5 exposure that we are going to have in this region because we cannot attain that level required by the EPA without the state and/or federal government regulating the levels that are causing the problem such as the ships and rail lines.
19. San Bernardino International Airport Authority and IVDA
None
20. Declare Vacancy on Public Nuisance Hearing Board
A MOTION was made by Councilman McCallon, seconded by Councilman Timmer, declaring a vacant seat on the Public Nuisance Hearing Board and to direct the City Clerk to advertise the vacancy pursuant to the Maddy Act. Motion carried, 4-0, with Councilwoman Lilburn absent.
Mayor Pro Tem Lilburn returned to the dais at 8:28 p.m.
ANNOUNCEMENTS
Wednesday, May 23 at 10:00 a.m. Budget Study Session
Thursday, May 24 at 5:00 p.m. City Council Meeting
CLOSED SESSION
At 8:29 p.m., the City Council and Redevelopment Agency convened into closed session regarding the following:
PUBLIC EMPLOYEE PERFORMANCE EVALUATION
Pursuant to Government Code Section 54957:
Title: City Manager
At 8:48 p.m., the City Council and Redevelopment Agency convened into open session, with all members present, making no announcements.
ADJOURN
There being no further business, Mayor Jones adjourned the meeting in memory of Bill Clingman.
Submitted By: Approved By:
Betty Hughes, CMC Ross B. Jones
City Clerk Mayor