minutes of the JOINT San José city council
AND REDEVELOPMENT AGENCY BOARD
SAN JOSÉ, CALIFORNIA TUESDAY,
DECEMBER 9, 2003
The Council of the City of San José convened
at 2:50 p.m. to hear Item 7.1, and 7.2 in a Joint Session with the
Redevelopment Agency Board in Council Chambers at City Hall.
Present: Council Members - Chavez, Chirco, Gregory, LeZotte, Reed, Williams, Yeager.
Absent: Council Members - Campos, Cortese, Dando; Gonzales.
JOINT REDEVELOMENT AGENCY/CITY COUNCIL ITEMS
7.1 Approval
of a DDA with Green Valley Corporation for the development of 150 housing units
and restoration of the historic First Church of Christ Scientist Building and
accepting the 33433 Summary Report and Re-Use Appraisal.
(a) Adoption of resolutions by the City Council and Redevelopment Agency approving the disposition of real property (APN 467-01-118) to Green Valley Corporation, accepting the 33433 Summary Report and Re-use Appraisal, and finding that the disposition of the property will assist in the elimination of blight, is consistent with the Implementation Plan for the Century Center Redevelopment Project Area and that the consideration for the property is not less than the fair reuse value for the proposed use, with the covenants and conditions authorized by the Disposition and Development Agreement (DDA);
(b) The Redevelopment Agency adopt a resolution approving a DDA with Green Valley Corporation for the development of 150 housing units and restoration of the historic First Church of Christ Scientist Building, authorizing the Executive Director to execute ancillary documents contemplated by the DDA, to close escrow and convey the Property subject to compliance with the terms of the DDA, and to negotiate and execute amendments to the DDA substantially in conformance with the intent of the DDA as reasonably necessary to conform to lender requirements; and
(c) The Redevelopment Agency adopt a resolution approving additional revenue of $1,350,000 to the Adopted FY 2004-2005 Revenue Budget, and amending the FY 2004-2005 Agency appropriations resolution as detailed on Attachment A.
CEQA: Resolution No. 71039.1 [CENTURY CENTER]
Documents Filed: Memorandum from Redevelopment Agency Executive Director Susan Shick,
dated December 9, 2003, recommending adoptions of said resolutions by the City
Council and Agency Board.
Discussion/Action: Mayor Pro Tempore Chavez called for Public Testimony. Alex Marthews, Preservation Action Council, and Marianne Bacigalupi, Barry Swenson Builders spoke for the issue. Redevelopment Agency Interim Director Harry Mavrogenes pointed out a clarification on item 7.1(c), stating this item will be dropped as the revenues dealing with this issue are beyond this current fiscal year, and will be appropriated in next year’s budget. Council Member LeZotte moved approval of the Staff recommendation. Council Member Reed seconded the motion.
Council Member Reed stated in regard to the First Church of Christ Scientist Building understands Barry Swenson Builders will be figuring the costs after the Disposition and Development Agreement (DDA) is signed, and considering old buildings are difficult to cost out for rehabilitation, if they do not like the costs, they can terminate this arrangement. Deputy Executive Director Redevelopment Agency John Weis replied that is correct, however Staff had been negotiating with Barry Swenson Builders for approximately seven months on the idea to actually swap some property that they own downtown for this site. He stated during the process, Staff and Barry Swenson Builders looked at the church and estimated the cost of rehabilitation, based on another of the rehabilitation projects they had been involved with previously. He stated Hulberg Associates verified the appraised estimated value of the rehabilitation of the property as $2.5 million. Council Member Reed asked how long does Barry Swenson Builders have to decide, which upon reviewing Page 3, Paragraph 3(a), the Developer’s responsibilities, states prior to conveyance they can investigate the site, and evaluate the site’s suitability for the proposed project, and also asked how close is Staff to the end of this deal and to actually implementing the project. Deputy Executive Director Redevelopment Agency John Weis replied that Barry Swenson Builders has up to 20 months to finish the construction documents, and Staff expects construction to be another 20 months thereafter. He stated by April or May 2005, the design should be completed, and Staff is beginning the conceptual and schematic designs next week. Council Member Reed stated this deal is structured so that Barry Swenson Builders is taking the risk on the cost of the rehabilitation of the old building, and Deputy Executive Director Redevelopment Agency John Weis replied that is correct.
Mayor Pro Tempore Chavez asked about Letcher’s Garage and how that fits into the DDA agreement. Deputy Executive Director Redevelopment Agency John Weis replied Letcher’s Garage is a 7,000 square foot property that is owned separately by Swenson Builders, and this particular potential conveyance is 57,000 square feet owned by the Agency, which is adjacent to that property. He stated in Staff’s discussions with Swenson Builders, Swenson Builders stated they would move forward if the preservation of Letcher’s Garage was required, but they wanted to look at both options, either keeping Letcher’s Garage or removing it to come up with the best urban design for the site. Mayor Pro Tempore Chavez expressed concern about how the process works as it relates to Letcher’s Garage, and how is Staff going to continue to work with Swenson Builders on strategies for Letcher’s Garage, and the housing development component. Deputy Executive Director Redevelopment Agency John Weis replied Staff’s intention is to collaborate with the developer Barry Swenson, the Historical Landmarks Commission, and Preservation Action Council to come up with a plan for this site which clearly has as its focus, the preservation and rehabilitation of the First Church of Christ Scientist structure. He stated Staff had two subcommittee meetings with the Historical Landmarks Commission regarding this property for urban design, and analyses of the property, and clearly that was the priority. He stated Letcher’s Garage was discussed as an important structure in these meetings, but that as long as the preservation of the Church was accomplished to the Department of the Interior standards, and that Barry Swenson would be willing to look at Letcher’s Garage as to whether it would be preserved or not. He stated as Staff moves forward with the developer, the intention is to focus on the Church, with the next step to study Letcher’s Garage, and investigate how keeping the garage either contributes or detracts from the site. Mayor Pro Tempore Chavez asked if the maker of the motion would accept two amendments to the motion, requesting that Staff make good faith efforts to properly examine the use and opportunity for Letcher’s Garage, as work progresses with Barry Swenson, and to determine the liability in regard to the theatre use of the First Church of Christ Scientist Building. Council Member LeZotte accepted the amendment to the motion. On a call for the question, the motion carried unanimously, and, Resolution No. 71867, entitled: “A Resolution of the Council of the City of San José Approving the Disposition of Real Property Located on the Block Bounded by East Saint James, North First, Devine and North Second Streets to Green Valley Corporation, Accepting the 33433 Summary Report and Re-Use Appraisal, and Making Certain Findings”; and Redevelopment Agency Resolution, were adopted, Item 7.1(c) was dropped, to come back next year as part of the 2004 budget, and Staff was directed to make a good faith effort to properly examine the use and opportunity for Letcher’s Garage, as work progresses with Barry Swenson Builders, and determine the liability in regard to the theatre use of the First Church of Christ Scientist Building. Vote: 7-0-4-0. Absent: Campos, Cortese, Dando; Gonzales.
7.2 Adoption of resolutions by the City Council and Agency Board approving the Annual Report of Financial Transactions of Community Redevelopment Agencies, Fiscal Year 2002-2003, and directing Staff to forward the report to the State of California Controller. [MERGED]
Documents Filed: (1) Memorandum from Redevelopment Agency Executive Director Susan
Shick, dated November 9, 2003, recommendation adoption of said resolution the
by City Council and Agency Board. (2) Copy of the Annual Report of Financial
Transactions for the Redevelopment Agency of the City of San José for FY
2002-2003.
Discussion/Action: Redevelopment Agency Interim Director Harry Mavrogenes introduced
Redevelopment Agency Director of Finance David Baum. Redevelopment Agency
Director of Finance David Baum reported the tax allocation bonds which were
approved to be sold by the Board on November 25, 2003, were sold by the Agency
today for $135 million. Upon motion by Council Member Williams, seconded by
Council Member Reed, and carried unanimously, Resolution No. 71868, entitled:
“A Resolution of the Council of the City of San José Approving the Annual
Report of Financial Transactions of Community Redevelopment Agencies, Fiscal
Year 2002-2003, and Directing Staff to Forward the Report to the State of
California Controller”, was adopted. Vote: 7-0-4-0. Absent: Campos, Cortese,
Dando; Gonzales.
ADJOURNMENT
The Council of the City of San José and
Redevelopment Agency Board adjourned at 3:05 p.m.
CINDY CHAVEZ, MAYOR PRO TEMPORE
ATTEST:
PATRICIA L. O’HEARN, CITY CLERK