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HomeMy WebLinkAboutMinutes - City Council - 2010-04-19 - Special Meeting I I I 80 City Council, Special Meeting Council Chambers 777 Cypress Avenue Redding, California April 19, 2010 5:15 p.m. The meeting was called to order by Mayor Jones with the following Council Members present: Bosetti, Dickerson, McArthur, and Stegall. Also present were City Manager Starman, City Attorney Duvernay, Assistant City Manager Tippin, Assistant to City Manager Clark, Redevelopment Manager Thompson, Senior Redevelopment Project Coordinator Haddox, Associate Redevelopment Project Coordinator Bade, Assistant Redevelopment Project Coordinator Rudolph, Deputy City Clerk Mize, and Executive Assistant Tipton. JOINT MEETING OF THE CITY COUNCIL AND REDDING REDEVELOPMENT AGENCY At the hour of 5:21 p.m., Mayor Jones convened the Special Meeting of the Redding City Council for a joint meeting with the Redding Redevelopment Agency. JOINT PUBLIC HEARING - Canby-Hilltop-Cypress Redevelopment Plan [R-030-050-653] Chair McArthur and Mayor Jones opened the public hearing regarding amending the Canby- Hilltop-Cypress Redevelopment Plan to eliminate the time limit for the establishment of debt. The following documents are on file in the Office of the City Clerk and the Redding Redevelopment Agency: Affidavit of Publication - Notice of Public Hearing No comments had been received to date. Assistant City Manager Tippin provided an overview of the Report to City Council (Council) and Redding Redevelopmen~ Agency (Agency) dated April 12, 2010, incorporated herein by reference, relative to amending the Canby-Hilltop-Cypress (CHC) Redevelopment Plan (Plan) to eliminate the time limit for the establishment of debt. Mr. Tippin explained that in 1993, Community Redevelopment Law (CRL) was amended pursuant to Assembly Bill 1290 (AB 1290), which required that redevelopment project areas include limitations on the time period to incur and repay debt with tax increment and on the period when a redevelopment plan can be effective. Mr. Tippin further explained that in 2001, Senate Bill 211 (SB 211) was approved, allowing redevelopment agencies to delete the time limit for the establishment of debt from redevelopment plans for those project areas that were adopted prior to December 31, 1993. Mr. Tippin stated that in 2003, the Agency issued a Tax Allocation Bond for the CHC Project Area. He explained that the associated Indenture of Trust (Indenture) requires that if the Agency proposes an amendment to the Plan that may affect the amount of tax revenues payable to the Agency, it shall appoint an independent redevelopment consultant to submit a report to the Agency, the bond insurer, and the bond trustee, on the effect of the proposed amendment. Accordingly, Mr. Tippin noted that the Agency contracted with Fraser & Associates to prepare a Report. In summary, the Report concludes that the amendment of the Plan to eliminate the time limit on the incurrence of debt will not materially reduce the amount of the taxes from the Project Area eligible for allocation to the Agency. Mr. Tippin relayed that pursuant to SB 211, the amendment of the Plan would require the Agency to commence pass-through payments to those taxing entities which have not previously entered into tax sharing agreements with the Agency. As noted in the Report, Mr. Tippin stated that the Agency has tax sharing agreements with all taxing entities except two in the CHC Project Area - the City of Redding and the Shasta Water Agency. The statutory payments to those taxing entities without tax sharing agreements is based on a formula contained in AB 1290, the same formula utilized for the taxing entities receiving pass- through payments from the SHASTEC and Buckeye Redevelopment Project Areas. Additionally, the payments are only due on increases in tax increment revenues above the levels received in the year in which the debt limit would have gone into effect. In the case of the CHC Original Area, this amount would be based on increases in excess of the 2003-04 assessed values. With the CHC Amended Area, this would be based on increases to the 04/19/2010 81 2010-11 assessed values. It is estimated that the additional pass-through payment for fiscal year 2009-10 for the CHC Original Area will be $121,000. Pass-through payments on the CHC Amended Area will not commence until fiscal year 2011-12. In order for the Agency to incur debt for the CHC Project Area beyond November 6,2010, it was recommended at the close of the public hearing that: 1) the Board accept the Consultant's Report prepared by Fraser & Associates as presented, thereby demonstrating that the proposed amendment of the CHC Plan, to eliminate the time limit for the establishment of debt, will not materially reduce the Tax Revenues eligible for allocation to the Project Area; 2) staff be directed to forward the Report to the Bond Trustee and Insurer; 3) the City Council be requested to adopt a budget amendment in the amount of$121,000 for the CHC Project Area; and 4) the City Council be requested to adopt an ordinance, for first reading by title only, amending ordinances establishing and amending certain limitations with respect to the Redevelopment Plan for the Canby-Hilltop-Cypress Redevelopment Project Area, specifically the elimination of the time limit for the establishment of debt. I It was determined that no one wished to speak on the matter and the public hearing was closed. A MOTION WAS MADE by Agency Member Bosetti, seconded by Agency Member Jones, to accept the Consultant's Report prepared by Fraser & Associates as presented, thereby demonstrating that the proposed amendment of the Canby-Hilltop-Cypress Redevelopment Plan, to eliminate the time limit for the establishment of debt, will not materially reduce the Tax Revenues eligible for allocation to the Project Area; direct staff to forward the Report to the bond Trustee and Insurer; adopt Budget Amendment No.3 in the amount of$121 ,000, allocating additional pass through funds for the Canby-Hill top-Cypress Project Area; and request the City Council to adopt an ordinance amending the Canby- Hilltop-Cypress Redevelopment Plan to eliminate the time limit for the establishment of debt. The Vote: AYES: Agency Members: Bosetti, Dickerson, McArthur, Stegall, and Jones NOES: Agency Members: None ABSTAIN: Agency Members: None ABSENT: Agency Members: None I A MOTION WAS MADE by Council Member Bosetti, seconded by Council Member Stegall, offering Ordinance No. 2454, an Ordinance of the City Council of the City of Redding amending ordinances establishing and amending certain limitations with respect to the Redevelopment Plan for the Canby-Hilltop-Cypress Redevelopment Project Area, specifically the elimination of the time limit for the establishment of debt, for first reading by title only. The Vote: AYES: Council Members: Bosetti, Dickerson, McArthur, Stegall, and Jones NOES: Council Members: None ABST AIN: Council Members: None ABSENT: Council Members: None JOINT PUBLIC HEARING - Market Street Redevelopment Plan [R-030-145-652] Chair McArthur and Mayor Jones opened the public hearing regarding amending the Market Street Redevelopment Plan to eliminate the time limit for the establishment of debt. The following documents are on file in the Office of the City Clerk and the Redding Redevelopment Agency: Affidavit of Publication - Notice of Public Hearing I No comments had been received to date. Assistant City Manager Tippin provided an overview of the Report to City Council (Council) and Redding Redevelopment Agency (Agency) dated April 12, 2010, incorporated herein by reference, relative to amending the Market Street Redevelopment Plan (Plan) to eliminate the time limit for the establishment of debt. Mr. Tippin explained that in 1993, Community Redevelopment Law (CRL) was amended pursuant to Assembly Bill 1290 (AB 1290), which required that redevelopment project areas include limitations on the time period to incur and repay debt with tax increment and on the period when a redevelopment plan can be effective. Mr. Tippin further explained that in 2001, Senate Bill 211 (SB 211) was approved, allowing redevelopment agencies to delete 04/19/2010 I I I 82 the time limit for the establishment of debt from redevelopment plans for those project areas that were adopted prior to December 31, 1993. Mr. Tippin stated that in 2003, the Agency issued Tax Allocation Bonds for the Market Street Project Area. He explained that the associated Indenture of Trust (Indenture) requires that if the Agency proposes an amendment to the Plan that may affect the amount of tax revenues payable to the Agency, it shall appoint an independent redevelopment consultant to submit a report to the Agency, the bond insurer, and the bond trustee, on the effect of the proposed amendment. Accordingly, Mr. Tippin noted that the Agency contracted with Fraser & Associates to prepare a Report. In summary, the Report concludes that the amendment of the Plan to eliminate the time limit on the incurrence of debt will not materially reduce the amount of the taxes from the Project Area eligible for allocation to the Agency. Mr. Tippin relayed that pursuant to SB 211, the amendment of the Plan would require the Agency to commence pass-through payments to those taxing entities which have not previously entered into tax sharing agreements with the Agency. As noted in the Report, Mr. Tippin stated that the Agency has tax sharing agreements with all taxing entities except four in the Market Street Project Area - the City of Redding, the Shasta Water Agency, the Enterprise School District, and the Anderson-Cottonwood Irrigation District. The statutory payments to those taxing entities without tax sharing agreements is based on a formula contained in AB 1290, the same formula utilized for the taxing entities receiving pass- through payments from the SHASTEC and Buckeye Redevelopment Project Areas. Additionally, the payments are only due on increases in tax increment revenues above the levels received in the year in which the debt limit would have gone into effect. With the Market Street Amended Area, this would be based on increases to the 2010-11 assessed values. Pass-through payments on the Market Street Amended Area will not commence until fiscal year 2011-12. In order for the Agency to incur debt for the Market Street Project Area beyond July 17, 2010, it was recommended at the close of the public hearing that: 1) the Board accept the Consultant's Report prepared by Fraser & Associates as presented, thereby demonstrating that the proposed amendment of the Market Street Plan, to eliminate the time limit for the establishment of debt, will not materially reduce the Tax Revenues eligible for allocation to the Project Area; 2) direct staff to forward the Report to the bond Trustee and Insurer; and 3) the City Council be requested to offer an ordinance amending the Market Street Plan to eliminate the time limit for the establishment of debt for first reading by title only. Gary Cadd opined that the two outstanding notes relative to the Downtown Mall parking facilities should be repaid. He suggested that the sale of Agency-owned properties would be a possible funding source. In response to Mayor/Agency Member Jones, Mr. Tippin explained that the amount of increment that the Midtown Project Area receives is minimal, and if a more aggressive approach was taken to repay the loans, the Agency would be prevented from funding projects. Chair McArthur requested additional information relative to the two outstanding loans. It was determined that no one else wished to speak on the matter and the public hearing was closed. A MOTION WAS MADE by Agency Member Bosetti, seconded by Agency Member Stegall, to accept the Consultant's Report prepared by Fraser & Associates as presented, thereby demonstrating that the proposed amendment of the Market Street Redevelopment Plan, to eliminate the time limit for the establishment of debt, will not materially reduce the Tax Revenues eligible for allocation to the Project Area; direct staff to forward the Report to the bond Trustee and Insurer; and request the City Council to adopt an ordinance amending the Market Street Redevelopment Plan to eliminate the time limit for the establishment of debt. The Vote: AYES: Agency Member: Bosetti, Dickerson, Jones, Stegall, and McArthur NOES: Agency Member: None ABSTAIN: Agency Member: None ABSENT: Agency Member: None 04/19/2010 83 A MOTION WAS MADE by Council Member Bosetti, seconded by Council Member McArthur, offering Ordinance No. 2455, an Ordinance of the City Council of the City of Redding amending ordinances establishing and amending certain limitations with respect to the amended Redevelopment Plan for the Market Street Redevelopment Project Area, specifically the elimination of the time limit for the establishment of debt, for first reading by title only. The Vote: AYES: Council Member: Bosetti, Dickerson, McArthur, Stegall, and Jones NOES: Council Member: None ABSTAIN: Council Member: None ABSENT: Council Member: None RESOLUTION - Approving Use of Tax Increment Funds; and OWNER PAR TICIP A TION AGREEMENT - Shasta Community Health Center [R-030-145-350] Assistant City Manager Tippin provided a highlight of the Report to City Council (Council) and Redding Redevelopment Agency (Agency) dated March 12,2010, incorporated herein by reference, relative to the request by Shasta Community Health Center (SCHC) for assistance with the costs associated with the expansion of its main facility and the associated required findings. I Mr. Tippin presented a PowerPoint presentation that showcased SCHC' s proposal to expand its main health facility utilizing a phased approach. The first phase will include constructing additional parking facilities on two parcels adjacent to the main facility recently acquired by SCHC and installation of a photovoltaic solar array and an ice chiller off-peak cooling system. This phase will require relocation of a sewer main which currently runs through the project site between the east and west wings and construction of storm drainage improvements on Continental Street (public improvements). Mr. Tippin noted that SCHC anticipates initiating construction of this phase in early 2010. Mr. Tippin explained that the second phase ofthe expansion project will include construction of a proposed three-story, approximately 16,000-square- foot addition to the main facility. As proposed, the building addition would add a total of 20 new exam rooms and ancillary support areas, such as offices, laboratories, storage space, nurses stations, and waiting rooms on the first and second floors. The third floor will include a lunch room, kitchen, boardroom, training room, and conference rooms. Mr. Tippin noted that construction is anticipated to begin in early 2011 and be completed in 2014. I Mr. Tippin stated that in July 2009, the Board conceptually approved $200,000 in funding assistance for certain aspects ofthe project subject to the City Council making any requisite findings. Subsequently, an Owner Participation Agreement (OP A) was prepared. Under the terms of the proposed OP A, SCHC will be responsible for designing and constructing both phases of the project. Mr. Tippin explained that SCHC will competitively bid the public improvements, pay prevailing wages, and will secure performance and payment bonds. He noted that Agency funding would be utilized to reimburse SCHC for design, civil engineering, relocation of the sewer line, construction of storm drainage and possibly other public improvements such as curb, gutter and sidewalk within the City's right-of-way associated with the first phase. Mr. Tippin relayed that although the project site is located within the Market Street Project Area, a portion of the proposed relocated sewer main would extend beyond the project area's boundaries. He further explained that construction ofthe public improvements will provide for storm drainage improvements where none currently exist and assist in the elimination of physical blight conditions within the Project Area by relocating a sewer line which, because of its location, is inadequate. Mr. Tippin noted that the Analysis of Proposed Use of Redevelopment Funds, incorporated herein by reference, demonstrates the Agency's provision of funding public improvements and meets the criteria set forth by California Health and Safety (H&S) Code Sections 33421.1,33445, and 33678 in that: 1) the improvements will be of primary benefit to the Market Street Project Area; 2) there are no other reasonable means of financing the improvements; 3) will assist in the elimination of blight; 4) is consistent with the Market Street Implementation Plan; and 5) will effectuate the purposes ofthe Redevelopment Plan for the Market Street Redevelopment Project Area. I It was recoJTImended that the City Council adopt a resolution approving the use of tax increment funds to construct public improvements both within the Market Street Redevelopment Project Area and extending beyond the Project Area boundaries and making the necessary findings. It was further recommended that the Agency's Board approve the 04/19/2010 I I I 84 OP A between SCHC and the Agency to provide funding in an amount not-to-exceed $200,000 to assist with costs associated with the expansion of its main facility located at Placer and Continental Streets. A MOTION WAS MADE by Council Member Stegall, seconded by Council Member McArthur, adopting Resolution No. 2010-41, a resolution of the City Council of the City of Redding, approving the use of tax increment funds to construct public improvements associated with the Shasta Community Health Center expansion located on Placer and Continental Streets, both within the Market Street Redevelopment Project Area and extending beyond the Project Area boundaries; and making the findings required by California Health and Safety Code Sections 33421.1, 33445, and 33678. The Vote: AYES: NOES: ABSTAIN: ABSENT: Council Members: Bosetti, Dickerson, McArthur, Stegall, and Jones Council Members: None Council Members: None Council Members: None Resolution No. 2010-41 is on file in the office of the City Clerk. A MOTION WAS MADE by Agency Member Bosetti, seconded by Agency Member Jones, to approve the Owner Participation Agreement with Shasta Community Health Center to provide funding in an amount not-to-exceed $200,000 to assist with costs associated with the expansion of its main facility located at Placer and Continental Streets. The Vote: AYES: NOES: ABSTAIN: ABSENT: Agency Members: Bosetti, Dickerson, Jones, Stegall, and McArthur Agency Members: None Agency Members: None Agency Members: None ADJOURNMENT There being no further joint business, Mayor Jones declare at the hour of 5:43 p.m. ATTEST: gmyO", ~W Deputy City Clerk 04/19/2010