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HomeMy WebLinkAboutPCDC Resolution 2008-09 12/08/2008 RESOLUTION NO. 2008-09 PETALUMA COMMUNITY DEVELOPMENT COMMISSION APPROVING A DESIGN CHANGE FOR THE RIVERFRONT APARTMENTS, .AUTHORIZING EXECUTION OF A MASTER AGREEMENT TERMINATING THE THEATER DISTRICT DEVELOPMENT AGREEMENT AND THE THEATER DISTRICT OWNER PARTICIPATION AGREEMENT WITH BASIN STREET PROPERTIES AND APPROVING FIRST AMENDMENT TO PARKING GARAGE EASEMENT AND OPERATING AGREEMENT WHEREAS, the City of Petaluma ("City") and Basin Street Properties ("Basin Street') entered into that certain Development Agreement ("Development Agreement") dated as of February 27, 2004, in accordance with procedures established by applicable law for such agreements; and, WHEREAS, the Petaluma Community Development Commission ("Agency") and Basin Street entered into that certain Owner Participation Agreement dated as of February 27, 2004 as amended by that certain First Amendment to Owner Participation Agreement dated as of January 23, 2006. Such Owner Participation Agreement and First Amendment to .Owner Participation Agreement are hereinafter collectively referred to as "Participation Agreement"; and, WHEREAS, by letter agreement between Basin Street and the City dated Janudry 21, 2004. ("Livery Stable Agreement") and by cultural resources mitigation measures required of Basin Street by both the Development Agreement and the Participation Agreement, Basin Street assumed certain obligations regarding the historic Livery Stable on the Project Property, including relocation of the Livery Stable from the Project property to a permanent location on City property, and negotiation with the City Manager to establish funding for ongoing restoration and maintenance of the Livery Stable from revenue sources to be determined by Basin Street; and, WHEREAS, Basin Street has relocated the Livery Stable to a permanent location on City property in accordance with the Livery Stdble Agreement; and, WHEREAS, to satisfy its obligation under the Livery Stable Agreement to negotiate to establish funding for ongoing restoration and maintenance of the Livery Stable, Basin Street has proposed a Master Agreement with the City and the Agency, a copy of which is attached hereto as Exhibit A and incorporated herein by reference, and described further below, which, among other things, provides for extending by 40 additional years at no cost to the City the present term of an existing 20 year Parking Garage Easement and Operating Agreement recorded as Document No. 200709 2 1 34 in the Official Records of Sonoma County ("Garage Easement") executed between Basin Street and the City, which provides public parking spaces and public access to them in the 'D' Street Garage constructed as part of the Project; and, WHEREAS, Basin Street has completed, and City has accepted, by Resolution No. 2008- PCDC Resolution No. 2008-09 Page 1 220 N.C.S. adopted December 1 , 2008, the public improvements required by the Development Agreement and Participation Agreement; and, WHEREAS, Basin Street has completed, and City has issued Certificates of Occupancy for all components of the private improvements required to be constructed by Basin Street except for 15 of 105 total apartment units in the Riverfront Apartments and a parking structure to serve the Riverfront Apartment, all as shown on the Construction Plans approved for the Theater District project ("the Project"); and, WHEREAS, City staff has determined that the existing parking available to serve the Riverfront Apartments and its associated retail/commercial development is adequate and meets th'e standards required within the Central Petaluma Specific Plan area without construction of the Riverfront Apartments parking structure; and, WHEREAS, the 15 residential units in the Riverfront Apartments which have not been constructed pursuant to the originally approved Construction Plans forthe Project do not constitute a material unfulfilled element of Basin Street's performance under the Development Agreement and Participation Agreement, given the size and scope of the other private residential, retail, office and commercial space that comprise the Project and which have been constructed; and, WHEREAS, Section 9.3 of the Development Agreement provides that amendments to the Development Agreement which do not relate to (a) the term of the Development Agreement, (b) the permitfied uses of the property involved in the Project, (c) provisions for "significant" reservation or dedication of land, (d) conditions, terms, restrictions or requirements for subsequent discretionary actions, (e) the density or intensity of use of the Project, (f) the maximum height or size of proposed buildings or (g) monetary contributions by the Developer provided for in the Development Agreement shall not require. hearing before the Planning Commission or City Council before the parties may execute an amendment to the Development Agreement; and, WHEREAS, the proposed design change, not being a material part of Basin Street's performance under the Development Agreement, does not require formal action to amend the Development Agreement; and, WHEREAS, acceptance of the proposed design change, a copy of which is attached hereto as Exhibit A and incorporated herein by reference, means that all Certificates of Occupancy necessary for the Project have been issued, and the Development Agreement therefore terminates by its own terms, as sefforth in Section 4.3 of the Development Agreement; and, WHEREAS, the Master Agreement proposed by Basin Street and attached hereto as Exhibit A would, in addition to providing for extension of the Garage Easement, (i) accept the Riverfront Apartments design change; (ii) terminate the Development Agreement and the Participation Agreement such that future transferees of the property and/or the private improvements in the Project would not be bound by the provisions, conditions, covenants and/or warranties contained in the Development Agreementbr the Participation Agreement; and (iii) satisfy all remaining obligations of Basin Street regarding the Livery Stable; and, WHEREAS, as part of the Master Agreement, Basin Street as an entity would continue to be bound by certain conditions, covenants and warranties expressly stated in Exhibit B to the Master Agreement, despite termination of the Development Agreement and the Participation PCDC Resolution No. 2008-09 Page 2 Agreement; and, WHEREAS, the First Amendment to Parking Garage.Easement and Operating Agreement extending the term of the Garage Easement is attached to the Master Agreement as Exhibit C thereto; and, WHEREAS, Basin Street has caused to be prepared by a retained consultant a Petaluma Theatre District parking Garage Financial Analysis (Walker Parking Consultants, November, 2008, "Walker Report") which values the cost to the City of replacing the 216 public spaces provided under the Garage Easement at the end of its existing 20 year term at a sum between $3.0 million dollars (surface parking) and $9.3 million dollars (parking structure); and, WHEREAS, the Walker Report projects that institution of a paid parking program could permit the City to realize "more than $7.1 million in new revenue" over the extended period of the Garage Easement if the paid parking program were implemented; and, WHEREAS,. this action is exempt from the California Environmental Quality Act ("CEQA") pursuant to 14 California Code of Regulations, Section 15061 (b)(3) because it can be seen with certainty that there is no possibility that this action may have a significant effect on the environment as defined under CEQA. NOW, THEREFORE, BE IT RESOLVED, by the Petaluma Community Development Commission as follows: l . The recitals stated above are adopted as true and correct and findings of the Petaluma Community Development Commission. 2. The Petaluma Community Development Commission approves the.change to the Theater District Construction Plans for the Riverfront Apartments to eliminate 15 unconstructed residential units and the parking structure originally proposed to serve the Riverfront Apartments; as shown in Exhibit B attached hereto and incorporated herein by reference. 3. The City Council authorizes and directs the Executive Director to execute on behalf of the Petaluma Community Development Commission the Master Agreement attached hereto as Exhibit A and incorporated herein by reference. 4. The Petaluma Community Development Commission acknowledges termination of the Development Agreement and Owner Participation Agreement identified herein and the fulfillment of Basin Street's obligdtions under the Livery Stable Agreement upon execution and recordation of the Master Agreement attached hereto as Exhibit A , S. The Petaluma Community Development Commission authorizes and directs the Executive Director to execute and cause to be recorded, on behalf of the Petaluma Community Development Commission, the First Amendment to Parking Easement and Operating Agreement attached as Exhibit C to the Master Agreement. ADOPTED this 8'h day of December, 2008, by the following vote: PCDC Resolution No. 2008-09 Page 3 Commissioner Aye No Absent Abstain Barrett X Freitas X Harris X Npu X O'Brien X Vice Chair Rabbitt X Chair Torliatt _ X i ~ i~ Pamela Torliatt, Chair/ ATTEST: 1,~1~~~~~~~ ~ ~ . Deborah L. Padovan~CMC, Recording Secretary I t APPROVE `AS'TO FORM: Eric Danly eneral Counsel PCDC Resolution No..2008-09 Page 4 EXHIBIT A MASTER AGREEMENT THIS MASTER AGREEMENT ~"Agreement") is entered into as of the lst day of December, 2008, by and between the CITY OF PETALUMA ("City"), a municipal corporation, the PETALUMA COMMUNITY DEVELOPMENT COMMISSION ("Agency"), and BASIN STREET PROPERTIES ("Bdsiri Street"), a California corporation, and PETALUMA THEATRE DISTRICT PARKING, LLC ("Parking Owner"), a California limited liability company. THE PARTIES ENTER into this Agreement on the basis of the following facts, intentions and understandings: A. City and Basin Street entered into that certain Development Agreement ("Development Agreement") dated as of February 27, 2004. B. Agency and Basin Street have entered into that certain Owner Participation Agreement dated as of February 27, 2004 as amended by that certain First Amendment to Owner Participation Agreement dated as of January 23, 2006. Such Owner Participation Agreement and First Amendment to Owner Participation Agreement are hereinafter collectively referred to as "Participation Agreement." C. City, Agency and Basin Street entered into that certain Parking Garage Easement and Operating Agreement executed on February 27, 2004, ("Original Parking Agreement") which was made a condition of development of the Petaluma Theater District project by terms of the Owner Participation Agreement between Agency and Basin Street. The Original Parking Agreement was modified to change the capacity of the easement grantor and property owner from Basin Street to Parking Owner and permit recordation. The modified Parking Garage Easement and Operating Agreement ("Modified Parking Agreement") is dated as of June 30, 2007. D. City and Basin Street have entered into that certain relocation of livery stable letter agreement ("Livery Agreement") dated January 21, 2004. E. The parties acknowledge that Basin Street, Parking Owner, City and Agency have completed all of their respective obligations under the Development Agreement, Participation Agreement, and Parking EasemenT (collectively "Existing Agreements"), including, but not limited to, completion of all of the improvements anticipated under the Existing Agreements, and City has issued Certificates of Occupancy to Basin Street and Parking Owner with respect to all such improvements.. F. The parties further acknowledge that, although the improvements have been complete, the parties still maintain certain contingent obligations and other obligations to one another as further described in this Agreement. G. The economy, as a result of the financial crisis, has become difficult and has caused Basin Street, the City, and the Agency to have to curtail certain programs and reduce staff in ways that limit the parties economic development and the provision of services to PCDC Resolution No. 2008-09 Page 5 the community. H. The parties desire to explore opportunities for economic development in the community as more specifically set forth in this Agreement, and the parties desire to terminate the Development Agreement, the Participation Agreement and the Livery Agreement except as.specified herein and to possibly amend the Modified Parking Agreement as specified herein. NOW, THEREFORE, in consideration, and mutual promises and covenants of the parties, the parties hereto agree as follows: 1. Amendment. The Development Agreement and Owner Participation Agreement are hereby amended such that the original design for the Waterfront Apartment portion of the Theater DistricYproject, which included 105 apartment units and a three story parking structure, is hereby revised and replaced with the existing as-built design attached hereto as Exhibit A, which includes 90 apartment units served by covered parking in lieu of the parking structure: 2. Development Agreement. The parties acknowledge that the Development Agreement is, as of the date first above written, terminated immediately following the amendment specified in Section 1, and the parties further acknowledge that the termination is pursuant to Section 4.3 of the Development Agreement in that final Certificates of Occupancy for the project have been granted by the City to Basin Street. 3. Owner Participation Agreement. The parties hereby terminate the Owner Participation Agreement except for those obligations of the parties as specified in Exhibit B attached hereto and incorporated herein by reference thereto, and City hereby accepts the improvements pursuant to Section 2.6.6.2 and shall take all actions necessary to effectuate such acceptance. 4. Modified Parking Agreement. The parties hereby agree to explore amending the Modified Parking Agreement on the following terms: a. Consultant. Basin Street, at its sole cost and expense, shall spend up to $10,000 on a parking consultant mutually acceptable to City and Basin Street to explore developing income streams from-the existing parking structure ~"Structure"). The parties shall select a parking consultant within thirty (30) days of execution of this Agreement, and the City designates City Manager, on City's behalf, as having the right to make a decision on the parking consultant. b. Existing Commitments. During such thirty X30) day period, the City, Agency; Basin Street and Parking Owner shall explore and catalog all of the existing parking commitments in the. Structure the parties have made to third parties, and they shall jointly prepare a statement of existing parking conditions for the parking consultant. c. Task. The parking consultant shall be requested to recommend methodologies for developing income from the.Structure consistent with the existing parking conditions. d. Profit Sharing. The parties agree that should they find a mutually acceptable parking program that can develop profit from the Structure, the parties shall share the net profits 50% each. From time to time, the parties may amend the parking program and alter the same as they deem mutually acceptable, but PCDC Resolution No. 200&-09 Page b with no change in the profit split. Net profits shall be all profits calculated arinudlly from the Structure diter [epayment to Basin Street of expenditures for the parking,consultanf and payment of all expensesin connection with the develdpment qnd implementation of`any parking fee prpgram, including, but not. limited to, gdfes,.mefers, enforcement, security and accounting expenses of the Structure directly related tdafVie pdrkingprdgram, but hot pre-existing taxes, insurance, maintenance and any existing debt'on the Structure. The City's share of annual net profits frdm the parking program will be disbursed by or before each 'year. •In;cohsidering whether td institute a parkirig progrdm the parties shall endeavor to avdid instituting;a parking program that negatively affects;the revenue received by any of the parties from the downtown Tenants and dwne~s. e. Term, The parties agree that the term of the Modified Parking Agreement shall be extended to a term pf sixty (60) years. f. Amendment. The. parties agree that they shall amend the Modified.Parking Agreemerit.to take Into accdunt any mutually aaceptdbte amendmenfs tp the Modified Parking AgreemeriYas a result of theiFdetermindtion regdrding lhcome streams from the Sfrue#ure by executing, acknowledging and recording contemporaneously with fhe execution hereof'jle=First Amendment to Modified Pdrking Agreement dtidched hereto as Exhibit C., g. Liverv Adreement. The Livery Agreement is hereby-)ermihated, and Basin Street specifically acknowledges that City may use profitsiCity derives from the Structure forsueh uses astlie City determines in City's sole discretion. l . Bdrid.Reauiremehts. 'The City, Agency, Basin, Street and Parking Owner ackndwledge that 8dsin Street"discovered one bond obligation'thdt Basin Street had not fulfilled, but-all parties now acknowledge that Basin Street hds delivered a bond for the public improvemeriis io'Cty and all bond'dbligations have been met by Basin Street and Parking Owner. 2.. Economic Development. Given the economy, the partiesshall work in good faith to determihe,mutually acceptable methods for increasing the economic benefits that the parties derive from the developments referenced iri the Existing Agreements. IN WITNESS WHEREOF, the parties have executed this Agreement: as of the day and year first above written. Dated`.. CITY OF PETALUMA By: _ John Browh, City'Mdridgef Attest; By. ;Claire Copper; City Clerk PCDG Resolution No. 2008-09 Page 7 Approved As to Form: By: Eric Danly, City Attorney Dated: BASIN. STREET PROPERTIES, a California-corporation By: Matthew T. White, President Dated: PETALUMA COMMUNITY DEVELOPMENT COMMISSION By: John Brown, Executive Director Approved As to Form: By: Eric Danly, Agency Counsel Dated: PETALUMA THEATRE DISTRICT PARKING LLC, a California limited lidbilitycompany By: G&W Ventures, LLC, a California limited liability company By: Matthew T. White, Manager PCDC Resolution No. 2008-09 Ppge 8 a PETELUfv1A RI~IEfi _ - - I - 1 _ ~ _ - I * Zf I I .v.en ` Y .J - 1 1 ...a_ _ _ _ T - I ~ ` 41 x «r rnrx r ~ ~,.c. ._i.. ~ J'. 3~ i ~ ..,F,i T L,, ~ ~ ~S~ I u ~I ' n~~ u 1-~1u ~1 ~I ~ I ~-z:.~s,.a=..-; C 1. y ~ q N I - I~ ~ A~3~.'f Y I ~p E I ~ . i I 7 ~ i _I 1_'r ~I l ~ f~ I ~ t ~ ~ ~ o ~~~II ~ ri,_xa 'i I I "I~ ~ ~ I ((I ~ i_~_~ ~ ~ ~ ~ ~F'I ~ Ir-.. i "m _ 'I 11 , o L.~ i ra'- Irr ~ ~ i ~ , I _ w 41 I I eF _Fe f LAS." - .I,.T fi^}T ...emu. I ~~~~r~ I ,~.II i ~I APA RTM GNTS Z ~ -e I _ L,fi. _P~ tB ~A 1 LI fwd I ~ I' i t`I o ss f I sxa rn.e~ I h r„M„ ,d'~LTI, r i I i PerALUraa r'+ O 1 ~ C7 - `wu I arum _rxr_tL I j O I' -I ~ 'Jj ~ ~ ~ N Q ~ ,CrP ^~a~r,. I -^=s+d~iari maam-- -_-'lYy~'•- ~ 1 ~ r . ~ °-~-I - 2003030 ~ I:. W ~ ~ ~ _ - - ~ a_ ~ ~.~.I AflG I t _ ~T ' ~M.CS ~ 6VtDIRG TYPE • BLILD9IG TYFE C ! MtOJEGT gg6pAAAY hRTECTURAL STE PLAN -..s. e I _.,...a... xsnr DUl1)IHIl !Yt'= B 91ALON6 TVVE 9' mow. eu~www+. 6VEf1ALL PNRKpW 3UdMFY _ ( .mm. ~ ..,..„..o-.. I r ......e.. «:A:i.:ow~..w ..r... w~~o w'.x~ .nm~wma... ~..~ma..v~..swa..+..iw.........m.. ,...i~aw.w.. EXHIBIT B fto Master Acareementl The parties acknowledge that the following provisions contained in the Participation Agreement shall remain in full force and effect for the term provided in the Owner Participation Agreement. 1. Section 2.6.5 (Warranty Provisions) 2. Section 3.8 (Indemnity Provisions) 3. Section 4.2 (Obligation to Refrain from Discrimination Provisions) 4, Sections 7.1 and 7.2 (Hazardous Material Provisions) 5. Section 8.1 (Relocation.Holds Harmless and Indemnity Provisions) 6. Section 10.1 (Indemnity Provisions) PCDC Resolviion No. 2008-09 Page 10 EXHIBIT C fto Master Agreementl Recording Requested by And Return To: City Clerk's Office City of Petaluma 1 1 English Street Petaluma, CA 94952 EXEMPT FROM RECORDING FEES PER GOVERNMENT CODE §§6103, 27383 FIRST AMENDMENT TO PARKING GARAGE EASEMENT AND OPERATING AGREEMENT Petaluma Theatre District (Petaluma, California) THIS FIRST AMENDMENT TO PARKING GARAGE EASEMENT AND OPERATING AGREEMENT (the "First Amendment") is made and entered into as of the _ day of December, 2008, by and among the City of Petaluma, a municipal corporation ("City"), the Petaluma Community Development Commission ("Agency"), Basin Street Properties, a Califdmia corporation ("Basin Street"J, and Petaluma Theatre District Parking, LLC, a California limited liability company ("Parking LLC"). City, Agency, Basin Street and Parking LLC are individually referred to in this First Amendment asa "Party" and collectively as the "Parties". RECITALS A. The Parties entered into-that certain Parking Garage Easement and Operating Agreement dated as of June 30, 2007 (the "Agreement"). The Agreement was recorded in the Official Records of Sonoma County on August 20, 2007 as Instrument No. 2007092134. B. The First Amendment is being entered into pursuant to that certain Master Agreement between the Parties of even date herewith. C. The Parties wish to amend the Agreement as set forth in more detail below. AGREEMENT NOW, for good and valuable consideration and other mutual covenants, the Parties hereby agree as follows: Extension of Term. The 20-year term of the easement granted in Section 3(d) of the Agreement, and the 20-year term of the Agreement as set forth in Section 29 of the Agreement, are hereby extended foran additional period of forty (40) years, for a total term of sixty (60) years. PCDC Resolution No. 2008-09 Page 1 1 Maintenance. Notwithstanding Section 7 of The Agreement, expenses incurred by Parking LLC in connection with the generation or collection of parking revenue from the Parking Garage shall be subject to reimbursement out of revenue generated from the Parking Garage, as more fully set forth in the Master Agreement. Parking Fees. Without limiting Parking LLC's existing rights to charge for parking in the Parking Garage, Parking LLC shall have the right to charge for parking in the Parking Garage in accordance with any shared revenue parking program established pursuant to the Master Agreement. Counterbdrts. This .First Amendment may be executed in two or more counterparts, which when taken together shall constitute one and the same instrument. IN WITNESS WHEREOF, the Parties have executed this First Amendment as of the day and year first above written: Dated: CITY OF PETALUMA By: John Brown City Manager Attest: By: City Clerk Approved As to Form. By: City Attorney PCDC Resolution No. 2ooa-09 Page 12 Dated: BASIN STREET PROPERTIES, a California corporation By: Matthew T. White, President Dated: PETALUMA COMMUNITY DEVELOPMENT COMMISSION By: John Brown, Executive Director Approved As to form: By: Agency Counsel Dated: PETALUMA THEATRE DISTRICT PARKING, LLC, California limited liability company By: G&W Ventures, LLC, a California limited liability company By: Matthew T. White, Manager PCDC Resolution No.2008-09 Page 13 STATE OF CALIFORNIA ) COUNTY OF ) On 2008 before me, ,Notary Public, personally appeared ,who proved to me on the basis of satisfactory evidence to be the persons) whose riame~s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity~ies), and that by his/her/their signafure~s) on the instrument the persons), or the enfityupon behalf of which the persons) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature' (seal) PWC Resoletion No. 2008-09 Page 14 m a - - PEfELUMA Fil4'ER ~ ~ y... I ~ _ - t - _ ~ ~ ~ _ _ h ~ _ ~ _ py _ u i ~ I ~ -W - = i p I °,1- - i ~ ~ ~ ~ 4 ~ "n~.~' I~ t ~ ; ~ - _ r ~ ~ ur, i i ~ ~ i .G i t x. ~ ~ .o T~ ~ ii "f n.c+r ~ 1 LI t ~ I ~ ~'-..s.~"~~'''-q ` _ I -1 I i J~ T~ 11 I ~ I I J t ~ ~ ~ ti, I ~t;~jj!~~y,, ~ 1 4~~ ~ I' I ~ ~ ~ i i! '~i ~ sv 19 i ~In , n. ~~~1 +1~ j o I tst~II t9 ~I i 1~ I i t • ~ m ~ s _ _ tS ~ ~ r ~ VERTOA h ' ' i.rt. ~-ii A s~ h+i r ~ RI ~ _I I _ iTIT l ' _ 1 I i. i APARTMENTS Z m ~ • ~ .t ~ . i ~ ryg b ._>jp 1 ~-~iJ,~ ~ _ III;;. ~a o. 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