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HomeMy WebLinkAbout18883 - RESOLUTIONS - 8/7/1996 RESOLUTI.ON NO. 18883 OF THE CITY COUNCIL OF THE CITY OF PALM SPRINGS, CALIFORNIA, APPROVING AN KIENDMENT TO THE DISPOSITION AND DEVELOPMENT AGREEMENT ENTERED INTO SEPTEMBER 7, 1994 , WITH THE AGUA CALIENTE BAND OF CAIIUILLA INDIANS, REGARDING VARIOUS TRANSFERS OF PROPERTY AND CONTEMPLATED ' DEVELOPMENT OF AN _lNDIAN GAMING FACILITY. WHEREAS, The Community Redevelopment Agency of the City of Palm Springs, California ("Agency") is duly formed and constituted under the Community Redevelopment Law (California Health & Safety Code Sections 33000, qt se�,rr . ) to carry out the purposes of redevelopment in the City of Palm Springs ("CityO°) ; and WHEREAS, the City Council adopted the Tahquitz-Andreas Redevelopment Project Area by Ordinance No. 1187, effective August, 1983 , which encompasses significant portions of an area adjacent to downtown Palm Springs; and WHEREAS, in Ordinance No. 1187, the City of Palm Springs made certain findings with respect to blight in the Tahquitz-Andreas Redevelopment Project Area, which findings were never questioned or challenged by judicial proceeding within the applicable statute of limitations for bringing any such challenge; and WHEREAS, on September 7, 1994, after significant negotiation and public hearings conducted pursuant: to California Health & Safety ' Code Section 33433 et seg. , both the City Council and the Agency reviewed and approved a Disposition and Development Agreement ("DDA") with the Agua Caliente Rand of Cahuilla: Indians (Tribe") ; and WIIEREA.S, the DDA provided for the contemplated construction of an Indian gaming facility over an approximately 10. 3 acre site as further identified therein, and contemplated to encompass some 119 , 000 square feet of casino facilities; and WHEREAS, the Tribe and the Agency have determined that it is in their mutual best interest to provide various minor modifications to the DDA, to make minor modifications to contemplated property transfers and to the proposed location and layout of the anticipated gaming facility; and WHEREAS, to accomplish these purposes, representatives of the Tribe and the Agency have negotiated and come to an agreement, which is embodied in the document entitled "Amendment No. 1 to Disposition and Development Agreement" ; and WHEREAS, a Summary Report, attached to the staff report presented to the Agency in connection with consideration of this Resolution, has been prepared as required by California Health & Safety Code Section 33433 , and is incorporated herein by this reference; and WHEREAS, the Summary Report specifies: (i) the modified cost of the Amendment to the DDA to the Agency, (ii) the estimated value of the property interest to be conveyed by the Agency, valued at the highest and best use permitted under the Redevelopment Plana, (iii) the value of the property interest to be conveyed determined with reference to the restrictions imposed by the Amendment to the DDA, (K) the purchase and/or lease price of all property interests to be conveyed, (v) an enpla.nation of the conditions imposed under the Amendment to the DDA on the property interests conveyed, and how the consideration to be received by the Agency is not less than the fair reuse value and the end use with such; covenants and 159/OM084-073i30109071.1 43/05/96 Page 2 conditions, and developments costs author ` ned by the sale or lease, and (vi) an explanation of how the trans „ction contemplated under the Amendment to the DDA will assist in eliminating blight; and. WHEREAS, the Summary ;Report is and has been made available to the public for review; and WHEREAS, it is the intent of the Agency and the desire of the City to work in cooperation with the Tribe on ventures which provide mutual benefit to both their constituencies. NOW, THEREFORE, DE IT RESOLVED by the City Council of the City of , Palm Springs as follows: SECTION 1. The City Council hereby finds that the Amendment to the DDA will benefit the Agency in a number of ways. The Amendment will still facilitate the contemplated development of: an Indian gaming facility within the Redevelopment Area, but: will do so at substantially less commitment of Agency property and funds then previously Contemplated under the original DDA. The prior agreement contemplated the Agency using up to $1. 5 million of the proceeds from sale of properties to acquire additional property to be donated to the Tribe. This $1. 5 million subsidy has been eliminated as the Tribe will fully fund any acquisitions of additional parcels. The Amendment to the DDA further provides the City Council an additional degree of certainty in connection with the "Mitigation Fee" amounts to be received from the Tribe, as an offset to public service and other impact's which will result from the ' operation of an Indian gaining facility on the contemplated site, or any other use thereon. SECTION 2 . The City Council finds that the Amendment to the DDA does not alter the original findings of the Agency made on September 7, 1994 , in connection with the manner in which the sale or lease of the property and development of the project contemplated under the DDA will result in the elimination of those blighted conditions which served as the basis for the establishment of the Tahqui.tz-Andreas Redevelopment Project; Area under Ordinance No. 1187 . Specifically, nothing in the First Amendment to the DDA changes the (i) urbanization of the area involved; (ii) the partial occupation in the area by unsafe, unhealthy buildings characterized by serious building code violations, defective design and physical construction, faulty or inadequate utilities, dilapidation and deterioration; nor (i ii) excessive vacant lots which, due to land ownership patterns, Location,, and economic blight, reflect the lack of proper utilization, and constitute a serious physical and economic burden; nor (iv) economically blighting conditions within the area, including depreciated or stagnant property values, abnormally high business vacancies, and high turnover rates. These characteristics taken together- were found in Ordinance No. 1187 to constitute blight under Health & Safety Code Section 33030 and 33031, and nothing in the First Amendment to the DDA makes any changes to these: conditions or these findings. i5a/OU,�BE-OD73/3GI1907Y.1 n68/CG/9ti —2— R18883 Page 3 SECTION 3 . The City Council finds that carrying out the Amendment to the DDA will assist in the elimination of blight; by assisting the development of a proposed Indian gaming facility within the downtown area of the City of Palm Springs, which will enhance the City's reputation and marketability as a tourist destination, will enhance the City's economic base., both by providing direct employment opportunities to members of the Tribe and. the ' general population, and by providing opportunities for enhancing and expanding on the City's tourist trade, including improvement in hotel and motel vacancy rates with a corresponding increase in transient occupancy tax revenues, and will provide additional recreational and social opportunities in the Community to residents and visitors alike, thereby carrying out the objectives of the General Plan. SECTION 4 . The consideration to be obtained by the Agency for the contemplated sale of the Fire Station parcel is not less than the fair market value of that parcel at its highest and best use in accordance with the plan, in that the parcel was appraised in 1993 at a fair market value of $581, 000. The Amendment to the DDA contemplates transfer of the property no later than one year after the effective date at the purchase price of $596, 000. This $596, 000 price may be offset by urn;, to $18 , 000 worth of credit for a lease payment to be made by the Tribe pursuant: to a single year lease payment with an option to purchase. Even presuming ' the full $18 , 000 offset to the purchase price, however, the consideration to be received amounts to $578, 000, or a drop from the 1993 appraised price of less than one-half of one percent. ,Based upon the Agency°S experience in this and other redevelopment areas, fair market value for properties generally have decreased in an amount more than one -half of one percent since 1993 . Consequently, even assuming full offset of the 10 _ease to purchase" payment. the Cif".+i Council has concluded the Agency is receiving not less than the fair market value for the sale of the property. SECTION 5. The City Council finds 'that the Agency is receiving not less than the fair reuse value for the property in connection with the one- year lease of the hire Station parcel to the Tribe at. the Mat rental rate of $18, 000. Eased upon a presumption that, the annual fair market rental rate is ten percent (]_0%) of fair market value (a presumption which under the Agency's experience. in this and other ' redevelopment project areas A a reasonable one for estimating fair market rental. value) , the fair market rental value of this property is between $58, 000 and $59, 6O0 per year. This fair market value rental is offset by a number of restrictions on the property in the hands of the lessee, however, as follows: (a) the $18, 0O0 rental payment must be made 0°up front, 0° instead of as accrued, and is nonrefundable in the event of any termination of the leasehold prior to the expiration of the full year term, without exercise of the option to buy, (o) the lessee is restricted in 159/014084-007313009071.2 48/O6196 -3- Page 4 its use of the property, a -.d may utilize it only for parking facilities„ (c) the lessee is required to make not. less than $25, 000 worth of improvements to the property over the course of the lease term, (d) improvements made by the lessee on the property must be surrendered to the Agency at the end of the lease, in the event the purchase option is not exercised, (e) utilization of the site is subject to the nondiscrimination covenants in ' the First Amendment to the DDA. ¢>iven all these restrictions, the City Council has determined that the $18 , 000 rental payment the Agency will receive is not less than the fair reuse 'value at the use of the property with the covenants and conditions and development coats authorized by the First Amendment to this DDA. SECTION 6 . The City Council finds that the First Amendment to the DDA is consistent with the implementation plan adopted by the Agency pursuant to California Health & Safety Code Section 33490, in that it will assist in achieving the following identified goals of that implementation plan, for the: reasons stated below: (a) Assemble and Consolidate 'Under Utilized "Land. The Project is contemplated to incorporate the Fire Station parcel in an overall gaming facility, which will be assembled with the nearby Spa Hotel site and other related sites, and unified in terms of use into a tourist destination ' gaming facility. In addition, the gaming facility will provide additional parking in the downtown area. (b) Coordinate Fu'tu'r_j= Devel.omme.. Completion of the Project contemplated under the First Amendment to the DDA will result in development of undeveloped areas which are stagnant or improperly utilized, as identified in the findings of blight made in ccajnection with 'the original establishment of the redevelopment area. (c) Assure Commercial Vitality„ The contemplated gaming hacility will enhance the amount of ]o tsisacss activity anticipated for retail, hotel, and other non--gaming businesses located or expected to be relocated to the area. (r ) >'=imu.late ],3co?�omae�l]nt]e's o�-�i;�en .. The development of a coordinated gaming facility will strengthen the economic base of the project area, by providing , direct con';-ribu'tio-n in the way of the "Mitigation Fee" and the economic benefits which will come from additional business activity and enhanced tourist viability of the downtown area. (e") P:rovrde A_i .itionxl=P Y1_i.�N. Spaces. The First Amendment to the DDA anticipates the provision of additional parking spaces in connection with the Phase 1 of the Casino development, with potential additional future parking spaces in the A R18883 Page 5 event the developeY' `7pts to construct additional phases, (r) Prot_ec'c Unicue C .a:racter Of Cc,munun_�y. The Project will assist the Tribe in the development of its cult_...tral resources, and in addition will serve to complement ' the convention facility by providing additional social and economic activity in the area of the Convention Center. SECTION 7 . The First A"iiieandment to the Disposition and Development Agreement by and between the Agency and the Tribe is hereby approved and on file in the office of the City Clerk. ADOPTED this 7th day or August, 1996 . AYES: Members Oden, Spurgin and Mayor Kleindienst NOES: We AESENT: Members Barnes and Hodges ATTEST: r TP' Trx;S PA 1 ;PFC By: ki y Clerk --- y anager REVIEWED & APPROVES]