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HomeMy WebLinkAbout6/21/2017 - STAFF REPORTS - 3.A. A. P A.M sA9 iy O N CITY COUNCIL STAFF REPORT 4<IFOAN% DATE: JUNE 21, 2017 LEGISLATIVE SUBJECT: INTRODUCTION OF AN ORDINANCE OF THE CITY OF PALM SPRINGS, CALIFORNIA, ADDING SECTION 5.26.080 OF THE PALM SPRINGS MUNICIPAL CODE, REGARDING EXTENSION OF A DEVELOPMENT OR CONSTRUCTION TIMELINE FOR QUALIFICATION AND ELIGIBILITY FOR HOTEL OPERATIONS INCENTIVE PROGRAM FROM: David H. Ready, City Manager BY: Edward Z. Kotkin, City Attorney SUMMARY The proposed Ordinance codifies the City Council's Charter authority as to the discretion to extend the timeline that controls qualification and eligibility of a hotel operator to participate in the City's established and finite Hotel Operations Incentive Program. RECOMMENDATION: Waive the reading of text in its entirety, read by title only, and introduce for first reading Ordinance No. , "AN ORDINANCE OF THE CITY OF PALM SPRINGS, CALIFORNIA, ADDING SECTION 5.26.080 OF THE PALM SPRINGS MUNICIPAL CODE, REGARDING EXTENSION OF A DEVELOPMENT OR CONSTRUCTION TIMELINE FOR QUALIFICATION AND ELIGIBILITY FOR HOTEL OPERATIONS INCENTIVE PROGRAM." STAFF ANALYSIS: The City Council has previously taken action, on a case-by-case basis, pursuant to its Charter authority and recommendations by staff to extend the development or construction timeline mandated by the City's Hotel Operations Incentive Program originally adopted in 2008, and then amended in 2010 and again in 2013. Hotel developers plan their projects based upon analysis that incorporates any material benefit that they may expect to realize during the operation of their hotel, e.g., a rebate of transient occupancy tax pursuant to the City's program. Hotel development and construction presents certain unique challenges. From time to time, a worthwhile hotel PfEM NO. 5' P� City Council Staff Report June 21, 2017 -- Page 2 EXTENSION OF TIMELINE FOR HOTEL INCENTIVE PROGRAM project that will advance the public welfare and serve to stimulate tourism, create jobs, and enhance the City as a destination may fail to meet timelines as originally planned and/or approved. The Council has previously granted extensions of time to allow particular hotels additional time to secure entitlements or to commence construction. The program as legislated included its development and construction timelines in Section 5.26.060, the section providing definitions for terms used throughout the chapter of the Palm Springs Municipal Code that created the incentive program. In granting extensions, the Council exercised its authority, pursuant to Sections 200 and 300 of the Charter of the City of Palm Springs, to make and enforce laws and regulations with respect to municipal affairs. The incentive program has always been finite, but it has been implemented with a modicum of flexibility by the Council to prevent the City from losing hotel projects. Staff recommends that the Council adopt an Ordinance that specifically enumerates the City's authority, with respect to the program's development and construction timelines, as the Council has exercised, and may intend to continue to exercise that authority. The timeliness of the proposed Ordinance is manifest in the developer requested extension to be considered by the Council at the June 21, 2017 meeting, along with this proposed Ordinance. Further, staff anticipates presenting at least three (3) more proposed extensions prior to the Council's August recess. While the Council has the authority to consider and approve or reject these extensions pursuant to the City's Charter, staff submits that an extension of a timeline under the Program is not a "new' matter. Rather, the extension of a development or construction timeline for a hotel in the Program is a matter of a project's compliance with the Municipal Code. The Code should not contain provisions that could be interpreted as inconsistent with the City's Charter power. As such, staff favors a process specifically reflected and codified in Chapter 5.26 of the Code. The language of the proposed Ordinance is simple. The Council will have the enumerated authority to extend a project development or construction timeline established in Section 5.26.060 in a fashion that advances the City upon a specific finding that a failure to do so would be inconsistent with at least one of three (3) municipal goals: equity with respect to an established program participant's interests, the City's best economic interest, and/or the public welfare. Notwithstanding the Council's desire to implement the Program to the City's maximum benefit, the Program is not perpetual. A developer that has not secured a land use entitlement or approval in relation to its proposed hotel use on or before December 31, 2015 shall not be eligible for any extension of a timeline under the proposed Ordinance. ALTERNATIVES: Decline to adopt this proposed Ordinance, and continue to consider, and on a discretionary basis, extend development and construction timelines related to the hotel incentive program based upon the City's authority under its Charter. City Council Staff Report June 21, 2017-- Page 2 EXTENSION OF TIMELINE FOR HOTEL INCENTIVE PROGRAM project that will advance the public welfare and serve to stimulate tourism, create jobs, and enhance the City as a destination may fail to meet timelines as originally planned and/or approved. The Council has previously granted extensions of time to allow particular hotels additional time to secure entitlements or to commence construction. The program as legislated included its development and construction timelines in Section 5.26.060, the section providing definitions for terms used throughout the chapter of the Palm Springs Municipal Code that created the incentive program. In granting extensions, the Council exercised its authority, pursuant to Sections 200 and 300 of the Charter of the City of Palm Springs, to make and enforce laws and regulations with respect to municipal affairs. The incentive program has always been finite, but it has been implemented with a modicum of flexibility by the Council to prevent the City from losing hotel projects. Staff recommends that the Council adopt an Ordinance that specifically enumerates the City's authority, with respect to the program's development and construction timelines, as the Council has exercised, and may intend to continue to exercise that authority. The timeliness of the proposed Ordinance is manifest in the developer requested extension to be considered by the Council at the June 21, 2017 meeting, along with this proposed Ordinance. Further, staff anticipates presenting at least three (3) more proposed extensions prior to the Council's August recess. While the Council has the authority to consider and approve or reject these extensions pursuant to the City's Charter, staff submits that an extension of a timeline under the Program is not a "new" matter. Rather, the extension of a development or construction timeline for a hotel in the Program is a matter of a project's compliance with the Municipal Code. The Code should not contain provisions that could be interpreted as inconsistent with the City's Charter power. As such, staff favors a process specifically reflected and codified in Chapter 5.26 of the Code. The language of the proposed Ordinance is simple. The Council will have the enumerated authority to extend a project development or construction timeline established in Section 5.26.060 in a fashion that advances the City upon a specific finding that a failure to do so would be inconsistent with at least one of three (3) municipal goals: equity with respect to an established program participant's interests, the City's best economic interest, and/or the public welfare. Notwithstanding the Council's desire to implement the Program to the City's maximum benefit, the Program is not perpetual. A developer that has not secured a land use entitlement or approval in relation to its proposed hotel use on or before December 31, 2015 shall not be eligible for any extension of a timeline under the proposed Ordinance. ALTERNATIVES: Decline to adopt this proposed Ordinance, and continue to consider, and on a discretionary basis, extend development and construction timelines related to the hotel incentive program based upon the City's authority under its Charter. oz City Council Staff Report June 21, 2017 -- Page 3 EXTENSION OF TIMELINE FOR HOTEL INCENTIVE PROGRAM Provide direction to staff to return to Council with a revision to this proposed Ordinance as to what criterion or criteria the Council will consider and/or apply in considering an extension of a development and/or construction timeline for the hotel incentive program. CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: This Ordinance is not a "project' for purposes of the California Environmental Quality Act (CEQA), as that term is defined by CEQA guidelines (Guidelines) section 15378. This Ordinance is organizational or administrative activity by the City of Palm Springs in furtherance of its police power, and will not result in a direct or indirect physical change in the environment, per section 15378(b)(5) of the Guidelines. FISCAL IMPACT: Not analyzed. Edward Z. Kotkin, Marcus L. Fuller, MPA, P.E., P.L.S., City Attorney Assistant City Manager David H. Ready, Esq., City Manager Attachments: Ordinance City Council Staff Report June 21. 2017-- Page 3 EXTENSION OF TIMELINE FOR HOTEL INCENTIVE PROGRAM Provide direction to staff to return to Council with a revision to this proposed Ordinance as to what criterion or criteria the Council will consider and/or apply in considering an extension of a development and/or construction timeline for the hotel incentive program. CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: This Ordinance is not a "project' for purposes of the California Environmental Quality Act (CEQA), as that term is defined by CEQA guidelines (Guidelines) section 15378. This Ordinance is organizational or administrative activity by the City of Palm Springs in furtherance of its police power, and will not result in a direct or indirect physical change in the environment, per section 15378(b)(5) of the Guidelines. FISCAL IMPACT: Not analyzed. Edward Z. Kotkin, Marcus L. Fuller, MPA, P.E., P.L.S., City Attorney Assistant City Manager David H. Ready, Esq., City Manager Attachments: Ordinance 03 ORDINANCE No. AN ORDINANCE OF THE CITY OF PALM SPRINGS, CALIFORNIA, ADDING SECTION 5.26.080 OF THE PALM SPRINGS MUNICIPAL CODE, REGARDING EXTENSION OF A DEVELOPMENT OR CONSTRUCTION TIMELINE FOR QUALIFICATION AND ELIGIBILITY FOR HOTEL OPERATIONS INCENTIVE PROGRAM City Attorney Summary This Ordinance provides for the City Council's discretion to modify timelines applicable to the development or construction of hotels with operators that participate in and benefit from the City's Hotel Operations Incentive Program, adopted by Ordinance in 2008. The City Council of the City of Palm Springs Ordains: SECTION 1. The City Council hereby makes the following factual findings: (l) from time to time, a worthwhile hotel project that will advance the public welfare and serve to stimulate tourism, create jobs, and enhance the City as a destination may fail to meet timelines as originally planned and/or approved, (H) the City always intended its successful Hotel Operations Incentive Program (the "Program"), codified in Chapter 5.26 of the Palm Springs Municipal Code (the "Code"), to be finite, (W) pursuant to its Charter power, the City has previously granted extensions of time allowed in the Program to allow particular hotels additional time to secure entitlements or to commence construction, (iv)to harmonize the City's lawful exercise of its Charter power with the Code, the Council wishes to adopt this Ordinance. SECTION 2. Add Section 5.26.080 to Chapter 5.26 of the Palm Springs Municipal Code, regarding the City's "Hotel Operations Incentive Program," to read: The City Council, upon a recommendation by the City Manager may, in an exercise of discretion, modify and extend a development or construction timeline reflected in Section 5.26.060. In approving any such modification or extension, the City Council shall make a factual finding that the modification or extension in question advances at least one of the following three municipal goals. The modification or extension in question: A. is mandated by equity with respect to an established program participant's interests, B. advances the City's best economic interest, and/or C. enhances the public welfare. Notwithstanding the merit of any proposed modification or extension, none shall be Page 1 ORDINANCE No. AN ORDINANCE OF THE CITY OF PALM SPRINGS, CALIFORNIA, ADDING SECTION 5.26.080 OF THE PALM SPRINGS MUNICIPAL CODE, REGARDING EXTENSION OF A DEVELOPMENT OR CONSTRUCTION TIMELINE FOR QUALIFICATION AND ELIGIBILITY FOR HOTEL OPERATIONS INCENTIVE PROGRAM City Attorney Summary This Ordinance provides for the City Council's discretion to modify timelines applicable to the development or construction of hotels with operators that participate in and benefit from the City's Hotel Operations Incentive Program, adopted by Ordinance in 2008. The City Council of the City of Palm Springs Ordains: SECTION 1. The City Council hereby makes the following factual findings: (i) from time to time, a worthwhile hotel project that will advance the public welfare and serve to stimulate tourism, create jobs, and enhance the City as a destination may fail to meet timelines as originally planned and/or approved, (ii) the City always intended its successful Hotel Operations Incentive Program (the "Program"), codified in Chapter 5.26 of the Palm Springs Municipal Code (the "Code"), to be finite, (ili) pursuant to its Charter power, the City has previously granted extensions of time allowed in the Program to allow particular hotels additional time to secure entitlements or to commence construction, (iv) to harmonize the City's lawful exercise of its Charter power with the Code, the Council wishes to adopt this Ordinance. SECTION 2. Add Section 5.26.080 to Chapter 5.26 of the Palm Springs Municipal Code, regarding the City's "Hotel Operations Incentive Program," to read: The City Council, upon a recommendation by the City Manager may, in an exercise of discretion, modify and extend a development or construction timeline reflected in Section 5.26.060. In approving any such modification or extension, the City Council shall make a factual finding that the modification or extension in question advances at least one of the following three municipal goals. The modification or extension in question: A. is mandated by equity with respect to an established program participant's interests, B. advances the City's best economic interest, and/or C. enhances the public welfare. Notwithstanding the merit of any proposed modification or extension, none shall be Page 1 granted unless an Operator has secured a land use entitlement or approval in relation to his/her/its proposed Hotel on or before December 31, 2015. SECTION 3. Neither introduction nor adoption of this Ordinance represents a "project" for purposes of the California Environmental Quality Act (CEQA), as that term is defined by CEQA guidelines (Guidelines) section 15378, because this Ordinance is an organizational or administrative activity that will not result in a direct or indirect physical change in the environment, per section 15378(b)(5) of the Guidelines. SECTION 4. The Mayor shall sign, and the City Clerk shall certify to the passage and adoption of this Ordinance and shall cause the same, or the summary thereof, to be published and posted pursuant to the provisions of applicable law, and this Ordinance shall take effect thirty (30) days after its adoption. PASSED,APPROVED AND ADOPTED BY THE PALM SPRINGS CITY COUNCIL THIS 21st DAY OF JUNE, 2017. ROBERT MOON, MAYOR ATTEST: KATHIE HART, INTERIM CITY CLERK Page 2 granted unless an Operator has secured a land use entitlement or approval in relation to his/her/its proposed Hotel on or before December 31, 2015. SECTION 3. Neither introduction nor adoption of this Ordinance represents a "project' for purposes of the California Environmental Quality Act (CEQA), as that term is defined by CEQA guidelines (Guidelines) section 15378, because this Ordinance is an organizational or administrative activity that will not result in a direct or indirect physical change in the environment, per section 15378(b)(5) of the Guidelines. SECTION 4. The Mayor shall sign, and the City Clerk shall certify to the passage and adoption of this Ordinance and shall cause the same, or the summary thereof, to be published and posted pursuant to the provisions of applicable law, and this Ordinance shall take effect thirty (30) days after its adoption. PASSED,APPROVED AND ADOPTED BY THE PALM SPRINGS CITY COUNCIL THIS 218t DAY OF JUNE, 2017. ROBERT MOON, MAYOR ATTEST: KATHIE HART, INTERIM CITY CLERK Page 2 05