HomeMy WebLinkAboutPCDC Minutes 06/05/20001
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City of Petaluma, California
Minutes of a Regular Meeting
Petaluma Community Development Commission
Monday, June 5, 2000
The Petaluma Community Development Commission met on this day at 3:05 P.M. in
the Council Chambers.
ROLL CALL
Present: Commissioners Cader-Thompson (3:10 p.m.), Healy, Keller, Maguire,
Chair Thompson, Vice -Chair Torliatt
Absent: Hamilton
PUBLIC COMMENT
COMMISSION COMMENTS
None
AGENDA CHANGES. ADDITIONS. AND DELETIONS
None
UNFINISHED BUSINESS
1. Discussion and Possible Direction Regarding LOK Marina Hotel Development
Group and Redevelopment Agency Participation for Project Financing for a
Three Star/Four Diamond Rated Hotel. (Stouder)
A. Resolution of the Community Development Commission of the City of
Petaluma Approving an Owner Participation Agreement By and Between the
Community Development Commission of the City of Petaluma and Lok
Petaluma Marina Hotel Company, LLC.
Commissioner Keller wanted shorter loan equity position and clarification of
"sale" and "partner," and he wanted to know who the other investors were.
Minutes of a
City of Petaluma, California
Petaluma Community Development Commission Meeting
Monday, June 5, 2000
Page 1
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Vice Chair Torliatt noted that Mr. Hawkins had presented the Commission
with a proposal made by the developer.
Mr. Hawkins disagreed and noted that he had been asked to prepare an
ownership agreement that reflected the current terms. He did not think the
meeting was the appropriate arena to discuss terms.
Attorney Don Black echoed Mr. Hawkins' comments.
Commissioner Keller had heard that labor negotiations had fallen through. If
that was true, he had no intention of supporting the project.
Commissioner Maguire preferred that the City Manager represent the
Commission in negotiation discussions. He had told Andy Lee and Kurt Lok
that he supported card neutrality; however, more importantly, he wanted to
hire locally.
Vice Chair Torliatt stated further that the Commission had not had the
opportunity to have a discussion with the consultant and she wanted to have
public comment before the Commission discussed what action or direction to
take.
Public Comment
Daniel Angel, 4024 Magee Avenue, Oakland, spoke in opposition to the
project if union labor agreement negotiations were dropped.
Al Semmler, 1700 Corby Avenue, Santa Rosa, spoke in opposition to the
project if union labor agreement negotiations were dropped.
Don Weisenfluh, 1092 Wren Drive, spoke in opposition to the project.
Vince Landof, 12 Cordelia Drive, spoke in opposition to the project.
Victor Chechanover, 2301 Marylyn, spoke in opposition to the project.
Geoff Cartwright, 56 Rocca Drive, spoke in opposition to any development in
the floodplain
Andy Lee, Restaurant and Hotel Workers Union Representative, spoke in
support of the City's participation in the project in order for the hotel and
restaurant workers to be employed.
Minutes of a
City of Petaluma, California
Petaluma Community Development Commission Meeting
Monday, June 5, 2000
Page 2
1 End of Public Comment
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4 Commissioner Cader-Thompson did not think the City was adequately
5 protected by the proposed agreement. She agreed with other
6 Commissioners' comments and questions and noted that she was
7 disappointed about the status of the union labor negotiations. She asked that
s the principals provide information for Commission's review in a timelier
9 manner.
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11 Commissioner Healy wanted to address how, procedurally, the Commission
12 would continue discussion. Substantively, he was not as concerned as other
13 Commissioners about the terms and he elaborated on Mr. Hawkins' analysis
14 as stated on pages 4 and 5 of the report dated May 31, 2000. He was
15 pleased with City Management's decision to hire Tim Kelly to analyze the
16 proposal and he supported the City's participation in the project.
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18 Commissioner Keller asked Mr. Lok what type of development would go in at
19 the property if the City did not participate and what kind of a market there
20 would be.
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22 Kurt Lok replied it was to be a development similar to a Marriott Courtyard.
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24 Vice Chair Torliatt noted that this was not a slight to Mr. Lok or his family and
25 acknowledged his continuing efforts in the community. Her thoughts on the
26 project were not personal, they were strictly professional. She understood
27 that a project may begin in the downtown area in the fall and could jeopardize
28 the City's security. She thought the Commission needed to focus on the TOT
29 revenue stream, and wanted to know if the City had budgeted the $750,000
30 in the Redevelopment Budget; she understood that the City was floating
31 revenue bonds at the rate of 6% interest. She noted she had a discussion
32 with other cities' council members regarding supporting hotel development.
33 They had indicated that it was not good; that is, that it was a very complex
34 issue.
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36 ADJOURN
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38 Chair Thompson adjourned the meeting at 4:20 P.M.
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42 RECONVENE
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44 The Petaluma Community Development Commission reconvened on this date at 7:05
45 P.M. in the Council Chambers.
Minutes of a
City of Petaluma, California
Petaluma Community Development Commission Meeting
Monday, June 5, 2000
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ROLL CALL
Present
Absent:
Commissioners Cader-Thompson (3:10 p.m.), Healy, Keller, Maguire,
Chair Thompson, Vice -Chair Torliatt
Hamilton
PUBLIC COMMENT
None
COMMISSION COMMENTS
None
AGENDA CHANGES, ADDITIONS, AND DELETIONS
UNFINISHED BUSINESS
2. Discussion and Possible Direction Regarding LOK Marina Hotel Development
Group and Redevelopment Agency Participation for Project Financing for a
Three Star/Four Diamond Rated Hotel. (Stouder) - (Continued from the
Afternoon Session)
B. Resolution of the Community Development Commission of the City of
Petaluma Approving an Owner Participation Agreement By and Between the
Community Development Commission of the City of Petaluma and Lok
Petaluma Marina Hotel Company, LLC.
J. T. Wick, President, Petaluma Area Chamber of Commerce, spoke in
support of the Lok Marina Hotel and development of a conference center.
Vince Landof, 12 Cordelia Drive, spoke in opposition to the City financing the
Lok Marina Hotel and development of a conference center.
Minutes of a
City of Petaluma, California
Petaluma Community Development Commission Meeting
Monday, June 5, 2000
Page 4
I Victor Chechanover, 2301 Marylyn Circle, spoke in opposition to the City
2 financing the Lok Marina Hotel and development of a conference center and
3 provided information about the sale to the prior owner of the parcels included
4 with this development project.
6 End of Public Comment
7
s Commission Chair Thompson wanted interest on the loan and an improved
9 position as a lender.
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11 Commissioner Maguire wanted principal and interest repaid, a secured loan
12 amortized over twenty years, due in ten, and in second position to the
13 construction loan. He also asked that the attorneys review the proposal
14 structure and verify that the City's position was secure and that an agreement
15 with the union for card neutrality be included.
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Commissioner Cader-Thompson acknowledged the necessity of a
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conference center and indicated that she wanted interest on the loan; she
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wanted a stronger position, so if sold, the investors and the City would be
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repaid at the same time. She agreed with Commissioner Maguire's
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statements regarding union card neutrality. She thought it was important that
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the Commission have more than a 4/3 vote. She thought the $750,000 was
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legitimate; however, she questioned the TOT.
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Commissioner Keller noted that the City had already subsidized the property
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for development, though not with Lok; but a 99 -year repayment agreement
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with Marina Office Park Associates (MOPA) to make ready for a Sheraton
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Hotel in 1992. He thought there existed a question of precedence. He
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agreed with Mr. Wick that this was a good location. He was concerned about
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financing assistance that had a lesser prime equity position to assure
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repayment to the City. He wanted a definition of "sale," such as a sale
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between partners. This was not a slight to Mr. Lok, but he wanted to know
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who the partners were, who were the equity partners in the venture. He
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suggested that perhaps they investigate the possibility of securing repayment
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by a tax lien and provide for repayment at below market rate interest. He
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thought union card neutrality was necessary. He asked if the cost of the
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parking lot for which the redevelopment funds were to pay was $450,000,
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why was $750,000 needed. He did not want to see a repeat performance of
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past City practices where the paper work was sloppy. Perhaps the $2.75
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million could be financed by subscriptions from community businesses and
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individuals.
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44 Vice Chair Torliatt added to Commissioner Keller's comments that should the
45 City subsidize the project, she favored a bond being floated for the interest.
Minutes of a
City of Petaluma, California
Petaluma Community Development Commission Meeting
Monday, June 5, 2000
Page 5
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She was not in favor of the proposal on the table but did think the marina was
a fine place to have the hotel. With the Petaluma Specific Plan, construction
in the downtown area would present competition and she had concerns with
the TOT revenue stream that a downtown proposal could pose. The City
should not have to subsidize a project to get a conference room. The TOT
funds could go to develop a City -owned facility. Regarding personal
guarantees, she noted that the developer had not agreed to do this in its
entirety. She thought financing by the City should minimally be secured as a
second in equity position.
Commissioner Maguire added that he favored a "sale" that would trigger
payment of the loan.
Commissioner Cader-Thompson was not clear why the facility could not be
scaled down. Regarding the TOT funds, she thought they should go towards
developing the area from which they were generated.
The Commission agreed that Mr. Stouder would present the developers and
their attorneys with Commission comments and direction. They scheduled a
meeting for Wednesday, June 14, at 5:30 P.M. to bring back the item back
for a status report, continued discussion, and possible action.
"-,1 11911100 1
Chair Thompson adjourned the meeting at 7:40 P.M.
E. Clark Thompson, Chair
ATTEST:
Beverly J. Kline, Recording Secretary
Minutes of a
City of Petaluma, California
Petaluma Community Development Commission Meeting
Monday, June 5, 2000