JOINT MEETING AND PUBLIC HEARING WITH THE REDEVELOPMENT AGENCY

The Redevelopment Agency of the City of Santa Rosa met in joint special study session with the Council of the City of Santa Rosa at 5:49 p.m. on the 29^th day of June, 2010, in the Council Chamber, City Hall, 100 Santa Rosa Avenue, Santa Rosa, California.

CALL TO ORDER AND ROLL CALL OF THE COUNCIL AND THE REDEVELOPMENT AGENCY

Councilmembers present: Mayor Gorin, Vice-Mayor Wysocky (by speakerphone), Councilmembers Oliveras, VasDupre, Jacobi, Bender, and Sawyer.

Redevelopment Agency:  Present:  Chairman Ours, Vice-Chairman Arnone, Agency Members Olsen and Lemke.  Absent:  Agency Member Evans.  Others in attendance included Executive Director David E. Gouin, Economic Development and Redevelopment Manager Jocelyn Lundgren, Program Specialist Frank Kasimov, Special Legal Counsel Ethan Walsh, Consultant Tim Kelly, and Recording Secretary Shirley Stevens.

STATEMENTS OF ABSTENTION BY COUNCILMEMBERS AND REDEVELOPMENT AGENCY MEMBERS

None

Item No.4

JOINT PUBLIC HEARING WITH CITY COUNCIL - AT&T SITE DISPOSITION AND DEVELOPMENT AGREEMENT, 520 THIRD STREET

Dave Gouin, Director of Economic Development and Housing, introduced the team involved in working with the developer team to produce the proposed Development and Disposition Agreement for the AT&T building downtown.

Frank Kasimov, Program Specialist, made the staff presentation for the approval of the disposition and development agreement with Museum Square LLC.  The former AT&T building had been vacant for over 15 years.  The Redevelopment Agency purchased the site to mitigate physical and economic blighting influences; prevent a speculative purchase and potentially incompatible uses; and to control and plan for the long term use of the building to benefit the downtown area.  Redevelopment of the AT&T site as a mixed-use, infill project meets Redevelopment objectives, Council goals and the Economic Development Strategy because it reduces physical and economic blighting influences; promotes additional cultural, employment, residential and economic activity downtown; helps reduce carbon generation as evidenced by the expectation that the building will achieve LEED Gold status; and provides new jobs and residential units with access to various modes of alternative transportation. 

The Disposition and Development Agreement (DDA), which required approval by both the Agency and Council, provided the terms and conditions under which the Agency would sell the Site to the Developer for the development of the project.  The Project is estimated to generate net revenue to the Agency of approximately $400,000; net revenue to the City over a 10-year period of approximately $1.2 million; annual, local private-sector economic activity of about $68.5 million; and 784 jobs of which 523 are long terms jobs and 261 are construction related jobs.  He said the proposal set forth by Museum on the Square LLC was found by the review panel to be the most viable use for

the site, which would include a street level museum and other mixed uses including commercial, residential, and a restaurant. Ethan Walsh, legal counsel representing the Redevelopment Agency, reviewed the price and terms of agreement which was basically a purchase and sale agreement which requires the developer to build specifically what the City wants for downtown uses, and conditions are placed within the agreement to assure those objectives are met.  $1.93 million was the sales price of the property in as-is condition which was determined to be within the fair market value price range. Mr. Kasimov closed by summarizing the project benefits. Bill Carle, Museum on the Square LLC, provided further details of the development proposal. Diane Evans, Sonoma County Museum, made a presentation on the museum and the art exhibits planned for the new museum location on site. 

PUBLIC HEARING 6:50:22 PM

Jack Osborne characterized the proposal as a sweetheart deal for the developer as the sales price represents a $1.3 loss from the agency’s purchase price and also objected to the contract clause which compels the agency to pay the lender in the event of default.  He questioned the use of only one appraisal and the lack of a performance bond.

Don Tomasi, TLDC Architecture, said their firm will be one of the key tenants in the building and that their firm is passionate about creating a good environment for downtown employees with transit options, larger offices and by providing more office space downtown.  He said this is an opportunity to replace an eyesore with an iconic structure that will provide needed urban housing downtown.

Jack Buckhorn, AFL-CIO, spoke in support of approval of the agreement with the provision that it be amended to favor hiring local contractors and apprentices to put those workers hard hit by the housing crisis back to work at living wage jobs.  He said that their proposed apprenticeship language would not exclude any contractor.  They want every local contractor to have a shot and use local apprentices.  He volunteered to meet to develop a compromise agreement.

Mark Shelley, member of the Glaziers Union, spoke in support of the apprenticeship program opportunities, noting it is a way of giving back to the community.

Jose Casias, Luther Burbank Savings, said that their 60 downtown employees would love to live in such a building and be able to walk to work. 

Doug Clark, ATA, said that their software firm has selected Santa Rosa as a new location and is excited to be a part of this project by being housed in the building.  The Washington DC area firm will be relocating to Santa Rosa and will provide high wage jobs in the community.

Amy Bacari, COO at ATA, said she was given the choice to stay at their Washington DC location or move to Santa Rosa and she chose the Santa Rosa location which in turn brought her husband’s company to the area.  She noted this project will have similar multiplier effects. 

Daniel Howes, unemployed electrician apprentice, said this will help to stimulate the local economy and asked that the Council approve the contract with provisions to support local contractors and apprentices.

John House, also spoke in support of apprenticeship programs and including the contract provision.

Dennis Rusotti, Sonoma County Conservation Action, supported the project as it creates an opportunity for a transit oriented downtown, has excellent amenities, and included a LEED Gold goal. He also supported adding the language on the local hires in order to take care of our own as much as possible.

Steve Rabinowitsh spoke in support as it is a wonderful opportunity for the museum and the arts by giving life to the arts district which would help revitalize the downtown.  He said he was glad to hear about the commitment on local hiring.

Lisa Maldonado, North Bay Labor Council, spoke in support of the project with the addition of the apprenticeship contract language.

Peter Tcherneff, supported Jack Osborne’s questions and sustainable gardening.

Evalina Molina, North Bay Institute of Green Technology, said it was very important to have an apprenticeship written in to the contract to help serve younger workers and the at-risk population. 

Hearing no further testimony, Mayor Gorin closed the public hearing at 7:21:07 PM.

Mr. Walsh responded to questions raised during public testimony, noting that since this is a property sale a performance bond would not be required as it would for a construction contract, noting also that conditions must be fulfilled before the title to the property is conveyed.  He said as the project goes forward the City would have some continuing control of the development process and that the risk of assuming the liability is remote since at that point the project would be concluded and in successful operation.

With respect to the request to modify the contract language for apprenticeship considerations, Mr. Carle said that he and Mr. Futrell would be happy to meet with the interested parties to maximize the opportunities but did not want to begin renegotiating the agreement at this point with language that had not been requested prior.

Mr. Buckhorn spoke as to the nature of the apprenticeship program, which is on the job training with academic instruction.

COUNCIL DISCUSSION 7:39:09 PM

Council discussion ensued regarding the issue of the apprenticeship program, with the developer agreeing to amend the language to add “and substantially allows for use of apprenticeship programs.”

MOVED by Councilmember Olivares, seconded by Councilmember Sawyer, carried unanimously, to adopt and waive reading of the text of the resolution, as amended, in item 12.4 as follows:

RESOLUTION NO. 27673 ENTITLED:  RESOLUTION OF THE COUNCIL OF THE CITY OF SANTA ROSA APPROVING AND AUTHORIZING THE EXECUTION OF A DISPOSITION AND DEVELOPMENT AGREEMENT

BETWEEN THE REDEVELOPMENT AGENCY OF THE CITY OF SANTA ROSA AND MUSEUM ON THE SQUARE, LLC

REDEVelopment agency COMMENT 7:54:07 PM

There was a consensus of support for the amended contract language as stated above.

Moved by Mr. Arnone, seconded by Ms. Lemke, carried 4-0-1-0 (Mr. Evans    absent), to adopt, as amended, and waive the reading of the text as follows:

RESOLUTION NO.  1627   ENTITLED:  RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF SANTA ROSA APPROVING AND AUTHORIZING THE EXECUTION OF A DISPOSITION AND DEVELOPMENT AGREEMENT BETWEEN THE AGENCY AND MUSEUM OF THE SQUARE, LLC

ADJOURN SPECIAL MEETING OF THE REDEVELOPMENT AGENCY

With no other business to come before the Redevelopment Agency, Chairman Ours adjourned the meeting at 8:00 p.m.

_______________________________

Shirley Stevens, Recording Secretary