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HomeMy WebLinkAboutMinutes - City Council - 2000-02-22 ,v 43 Joint City Council and Redding Redevelopment Agency Meeting Council Chambers 777 Cypress Avenue Redding, California February 22,2000 7:00 p.m. I The joint meeting of the City Council and the Redding Redevelopment Agency was called to order by Mayor Anderson with the following Council! Agency Members present: Cibula, Kight, Pohlmeyer, and Chair McGeorge. Also present were City Manager Warren, Assistant City Manager Perry, Deputy City Manager Starman, Assistant City Attorney Tranberg, Public Works Director August, Economic Development Director Mitchell, Senior Planner Morgon, Senior Planner Haddox, Housing Program Supervisor Meek, Housing Program Supervisor Buckley, Associate Planner Thompson, Assistant Planner Dent, City Treasurer Clark, City Clerk Strohmayer, and Executive Secretary Rudolph. PARTICIPATION AGREEMENT WITH MT. SHASTA MALL REGARDING EXPANSION AND RENOVATION OF THE MT. SHASTA MALL AND ASSOCIATED FINDINGS (R-030-050-310) Council! Agency Members Anderson and McGeorge abstained from discussion and voting on this matter. I City Manager Warren provided an overview of the Report to City Council and Redding Redevelopment Agency (Agency), as well as the memorandum to the City Council, both dated February 8, 2000, incorporated herein by reference. Mr. Warren explained that the owners of the Mt. Shasta Mall (Owners) had entered into an agreement with Federated Department Stores for Macy' s to locate at the north end of the Mt. Shasta Mall (Mall). He related that the Owners intended to demolish the former Rite-Aid Store and prepare and sell the pad to Federated, which would in turn construct Macy's. He indicated that the Owners were proposing $32 million in improvements to the Mall ($17 million for Macy's and $15 million to the balance of the Mall). He related that the Agency was being requested to allocate up to $795,000 to assist in financing the following public improvements: (1) a traffic signal at the intersection of Dana Drive and Canby Road; (2) a portion of the cost associated with enclosing the Little Churn Creek channel adjacent to the Mt. Shasta Mall; and (3) improvements to Old Alturas Road between Churn Creek and Canby Roads. I Mr. Warren noted the following differences between the Gottschalks and Macy's proposals: (1) the Agency proposed to provide $475,000 in public improvements for $15 million in private sector improvements relative to the development of Gottschalks. With respect to Macy's, the Agency would provide $795,000 to leverage $32 million in private sector improvements; and (2) the Macy' s agreement would only provide funding for infrastructure improvements. In addition, the Owners would do major facade improvements and add an additional 35,000-square-feet of retail space to the Mall with the construction ofMacy's. He believed that the addition of Macy' s would not only strengthen the Mall, but the Canby- Hilltop-Cypress Redevelopment Project Area and the community as well. He indicated that the proposed request for funding was a typical method of spending redevelopment dollars. Mr. Warren explained that it was estimated that under the proposed plan, the Agency would receive approximately $111,000 of the $150,000 in additional property tax revenue, with the County of Shasta and various school and special districts receiving the remaining $39,009. 02/22/2000 44 In addition, staff estimated the net increase in sales tax revenue to the City would total approximately $100,000 per year. Mr. Warren summarized by stating that the Agency and the City would recover their investment in less than four years and the requested funding would be utilized for already needed public improvements. He noted that Macy' s would also reduce the sales tax leakage occurring and improve the overall quality of the Mt. Shasta Mall. ML 'Warren related that, as in the past, the Owners would need to utilize a portion of Canby Road for parking in order to satisfy its agreement with Ie. Penney. He recalled that the City had abandoned a portion of Canby Road last year as a part of the Gottschalks project, but it had not yet provided an easement to the Owners to utilize this City-owned property for parking. The Owners would, in turn, create approximately 67 parking spaces, 41 fewer than were needed for the Gottschalks project. I ML Warren indicated that staffwas proposing a change to Section 2.11 of the Agreement, wherein stronger language was being recommended relative to the use of local contractors. He stated that this is similar to what the City attempted to do with the Civic Center project. It is the recommendation of staff that if the City Council and the Agency decides to participate in the project, the following actions would be necessary: 1. Both the City Council and the Agency would adopt resolutions making the findings required by Sections 33421.1 and 33445 of the California Redevelopment Law; 2. The City Council and the Agency would adopt resolutions approving the Participation Agreement (which includes a 20-year easement to the Mt. Shasta Mall for public parking in the vacated portion of Canby Road) and authorize the Mayor Pro Tempore and the Vice Chairman, respectively, to execute said Agreement. I Mr. Friedman, representing the Owners, related that this project was larger and more ambitious than the previous Gottschalks project. In addition, the proposed project would provide a complete exterior remodel, parking lot modifications, and entice new tenants. He opined that the City's return on investment associated with this project looked very strong -- for every dollar of public sector money spent, the private sector would spend $40. Council! Agency Member Kight stressed the importance of using local individuals to work on public and private projects whenever possible. Mr. Friedman related that they would provide local contractors with a fair opportunity to do the work. . Barbara Jagger, Macy's representative, related that she has been employed with Macy's for 33 years, working her way up through the ranks. She indicated that she had served on the Danville City Council and understood the City Council's and Agency's obligations. She stated that the proposed store in Redding would be a prototype store and, if successful, would be utilized in similar markets. She related that the store would have approximately 120 employees, with approximately one-half being considered full time. During peak sales periods, an additional 40 to 50 employees would be added. She added that the sales projections they utilized were conservative. She provided an overview of the store's layout and highlighted the products which would be featured in each department. In response to Council! Agency Member Cibula, Ms. Jagger related that there would be approximately ten executive positions. Full-time employees would receive partial medical and dental benefits and well as employee discounts. Part-time employees would receive discounts and vacation benefits. I Council! Agency Member Pohlmeyer cited studies showing retail sales leakage in the range of $20 million and questioned what part of this leakage Macy's hoped to recapture. 02/22/2000 45 Ms. Jagger indicated that she did not have any firm numbers, but would strive to get back as much as possible. Frances Jenkins conveyed her excitement over the prospect of being able to buy quality items locally. She stressed the importance of having a local upscale store in order to prevent people from driving out of the area to shop, thereby keeping sales dollars in the local community. I Kent Dagg, Shasta Builders' Exchange, expressed support for the proposed project. He stated that he had talked with both the Owners and the Federated representatives regarding the amended language relative to the use of local contractors and he believed they would make efforts to utilize local contractors. He, therefore, lent the Shasta Builders' Exchange support to the proposed project, staff's recommendation, and the proposed modification to the Agreement. Dave Ragnell, President of the Greater Redding Chamber of Commerce, conveyed that the Chamber saw no downside to the proposed Project. He indicated that the $32 million project would revitalize the Mall and make it the shopping extravaganza it should have been a long time ago and urged the CounciV Agency to support the request. Marge Cantrell related that she owns approximately 1.5 acres within one block of the Mall, and questioned whether the channel was on the Mall's property. She also asked how far the improvements would go on Churn Creek Road. I Mr. Starman stated that it was his recollection that the channel was on the Mall's property, but the City retained an easement. He explained that the improvements being proposed are on Old Alturas Road between Churn Creek and Canby Roads. In addition, the speed bumps currently located behind the former Rite-Aid building would be removed. He related that the 20-year easement would only provide parking on the west side of Canby Road and there was nothing in the agreement which required the Mall to forfeit the pad located by the mini market. Ms. Cantrell believed this was an excellent project and her only concern was the channel. She stated that she was personally excited about the project and wanted to welcome Macy's to Redding. Linda Miller welcomed Macy's to Redding. She questioned, however, how it could be considered a viable venture if there were not sufficient funds to sustain it without the City's investment. Mr. Friedman replied that they had looked at different investment alternatives and, without public assistance, they would not be able to take the project forward. -I Ms. Miller expressed concern about the use of redevelopment funds for the proposed project. She related that the channel was supposed to be what classified this project to meet the blighted standards, and the project, as proposed, would not even cover the entire channel. She indicated that a requirement to provide a two-story parking structure would eliminate the need to reduce the number oflanes on Canby Road. She did not believe that the traffic study prepared by Gottschalks took into account the increased traffic resulting from recent development in the area or the proposal to connect Dana Drive into Highway 44. While she would like to see Macy's locate in Redding, however, she disagreed with the blighted designation of the Mt. Shasta Mall area. She requested that the City Council and the Agency carefully consider the use of redevelopment money on such a project. In response to CounciV Agency Member Kight, Mr. Friedman indicated that the parking problem at the Mall would be resolved prior to the Christmas season. 02/22/2000 46 Council/Agency Member Cibula stated that after listening carefully to all the comments made, he believed the proposed project represented a good investment. He opined that the funds were being spent on public improvements which would provide a large benefit to the community. In addition, he believed the investment would assist in stopping sales leakage and also bring new people to the area, thereby benefitting the existing stores and businesses, while at the same time bringing new investment and business to the area. Council/Agency Member Pohlmeyer concurred with his comments. Council/Agency Member Kight also concurred with Council/Agency Member Cibula's comments. He expressed appreciation to Macy's for selecting Redding as one of its locations and was anxious to be not only a good business partner, but a good neighbor as well. He also hoped that Macy's would participate in local activities and give something back to the community. I In response to City Manager Warren, Mr. Friedman stated that they anticipated construction to begin April 2, 2000, and be completed in one year. MOTION: Made by Council Member Pohlmeyer, seconded by Council Member Cibula, to adopt Resolution No. 2000-39, a resolution of the City Council of the City of Redding approving the use of up to $795,000 in redevelopment funds to assist with certain public improvements associated with the Mt. Shasta Mall expansion project and making the following findings: (a) The public improvements are of benefit to the Project Area; (b) No other reasonable means of financing the public improvements are available to the community; (c) The payment of funds for the development of the public improvements will assist in the elimination of blighting conditions within the Canby-Hilltop-Cypress Project Area and is consistent with the Project Area's adopted Implementation Plan; and (d) The provision of the public improvements is necessary to effectuate the purposes of the Redevelopment Plan for the Canby-Hilltop-Cypress Project Area. Voting was as follows: Ayes: Noes: Absent: Abstain: Council Members - Cibula, Pohlmeyer, and Kight Council Members - None Council Members - None Council Members - Anderson and McGeorge I Resolution No. 2000-39 is on file in the office of the City Clerk. MOTION: Made by Council Member Pohlmeyer, seconded by Council Member Cibula, to adopt Resolution No. 2000-40, a resolution of the City Council of the City of Redding authorizing the execution of a Participation Agreement between the City of Redding, the Redding Redevelopment Agency, and the owners of the Mt. Shasta Mall regarding the expansion and renovation of the Mt. Shasta Mall (including a 20-year easement to the Mt. Shasta Mall for public parking in the vacated portion of Canby Road) contingent upon the amendment of Section 2.11, Use of Local Contractors. Voting was as follows: Ayes: Noes: Absent: Abstain: Council Members - Cibula, Pohlmeyer, and Kight Council Members - None Council Members - None Council Members - Anderson and McGeorge Resolution No. 2000-40 is on file in the office of the City Clerk. I MOTION: Made by Agency Member Pohlmeyer, seconded by Agency Member Cibula, to adopt Resolution No. 2000-03, a resolution of the Redding Redevelopment Agency approving the use of up to $795,000 in redevelopment funds to assist with certain public improvements associated with the Mt. Shasta Mall expansion project and making the following findings: (a) The public improvements are of benefit to the Project Area; (b) No other reasonable means of financing the public improvements are available to the community; 02/22/2000 'I I 'I 47 (c) The payment offunds for the development of the public improvements will assist in the elimination of blighting conditions within the Canby-Hilltop-Cypress Project Area arid is consistent with the Project Area's adopted Implementation Plan; and (d) The provision of the public improvements is necessary to effectuate the purposes of the Redevelopment Plan for the Canby-Hilltop-Cypress Project Area. Voting was as follows: Ayes: Noes: Absent: Abstain: Agency Members - Cibula, Pohlmeyer, and Kight Agency Members - None Agency Members - None Agency Members - Anderson and McGeorge Resolution No. 2000-03 is on file in the office of the Redding Redevelopment Agency. MOTION: Made by Agency Member Pohlmeyer, seconded by Agency Member Cibula, to adopt Resolution No. 2000-04, a resolution of the Redding Redevelopment Agency authorizing the execution of a Participation Agreement between the Redding Redevelopment Agency, the City of Redding, and the owners of the Mt. Shasta Mall regarding the expansion and renovation of the Mt. Shasta Mall contingent upon the amendment of Section 2.11, Use of Local Contractors. Voting was as follows: Ayes: Noes: Absent: Abstain: Agency Members - Cibula, Pohlmeyer, and Kight Agency Members - None Agency Members - None Agency Members - Anderson and McGeorge Resolution No. 2000-04 is on file in the office of the Redding Redevelopment Agency. STILLWATER BUSINESSIINDUSTRIAL PARK (E-050-800) City Manager Warren stated that it would be helpful in securing planning and infrastructure grants from the State and Federal government if the City Council would adopt a resolution indicating their support for the Stillwater Business and Industrial Park. It was, therefore, the recommendation of staff that the City Council adopt a resolution supporting the Stillwater Business and Industrial Park. MOTION: Made by Council Member Kight, seconded by Council Member Cibula, that Resolution No. 2000-41 be adopted, a resolution of the City Council of the City of Redding supporting the Stillwater Business and Industrial Park. Voting was as follows: Ayes: Noes: Absent: Council Members - Cibula, Kight, McGeorge, Pohlmeyer, and Anderson Council Members - None Council Members - None Resolution No. 2000-41 is on file in the office of the City Clerk. ADJOURNMENT There being no further business, at the hour of 8:07 p.m., Mayor Anderson declared the meeting adjourned. APPROVED Zc//ed:b~ ayor ATTEST tZ-/~4 City Clerk 02/22/2000