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HomeMy WebLinkAboutStaff Report 5.E 10/07/2019DATE October 7, 2019 Agenda Item #5.E TO: Honorable Mayor and Members of the City Council through City Manager FROM: Ingrid Alverde, Director, Economic Development & Open Government, Eric Danly, City Attorney '` j SUBJECT: Adoption of a Resolution of Intent to Convey the Polly Klaas Performing Arts Center Property and $65,000 in Renovation Funding to the Polly Klaas Foundation Subject to the Foundation Raising $1 Million for Renovations and Other Specified Conditions RECOMMENDATION Staff recommend that the City Council adopt the attached Resolution of Intent to Convey the Polly Klaas Performing Arts Center Property and $65,000 in Renovation Funding to the Polly Klaas Foundation Subject to the Foundation Raising $1 Million for Renovations and Other Specified Conditions. BACKGROUND The Polly Hannah Klaas Performing Arts Center ("Center") is located at 417 Western Ave., identified as Assessor Parcel Number 008-043-001, on the triangular parcel that lies between the intersections of English Street, Post Street and Western Avenue ("Property") in the City of Petaluma. The Center, constructed in 1910-1911, is directly across English Street from Petaluma City Hall. In 1971, the City of Petaluma agreed to purchase the Property from the Christian Church of Petaluma for $22,500, with the intention of demolishing the structure and utilizing the site for parking to support City Hall expansion. Following acquisition by the City, concerned citizens launched a campaign to save the building. The facility was assigned to the Recreation Department and was referred to as the Five Corners Community Center. City records reflect that some renovation was completed during this time, including a roof replacement and electrical upgrades. The building was moderately used for recreation activities that included performing arts. In January 1994 the City Council adopted Resolution 94-13 N.C.S. naming the building the Polly Hannah Klaas Performing Arts Center. The resolution declared the City Council's intent to establish a lasting tribute to Polly Hannah Klaas, citing the Center as an appropriate remembrance because theater and the performing arts held a special place in the heart of Polly Klaas, and further declared that "the memory of this special child will forever be a part of the community of Petaluma." Several attempts have been made to generate revenue to renovate and operate the Center for the purpose of providing a venue for youth perfonning arts. The most notable effort was that of the non-profit group Polly Hannah Klaas Performing Arts Theater Company ("Theater Company"). The members of the Theater Company were originally part of the Petaluma Leadership class of 2000, and they adopted the Theater Company project and spent several years fundraising for it. Unfortunately, their efforts were derailed in 2004 by a contracted executive director who was found guilty of embezzling funds from the group. The Theater Company left nearly $170,000 in an account with the City to be used for Center renovations. The City continues to hold those funds. In approximately 2007, the Center's fire rating was changed from Assembly Occupancy to Storage. In part, the change in designation reflected its use. However, a contributing factor was that many of the building's safety features require maintenance, repair or upgrades and that as a result it was unsafe for large gatherings. Efforts were made to partner with Cinnabar Theater for Center renovations and operation. However, as the economy weakened in 2008 and 2009, the Cinnabar Theater withdrew from discussions in order to concentrate on assuring funding to continue existing operations. During the same time, the City too suffered from the effects of what would be known as the Great Recession and began a steady reduction in staffing and funding for Parks and Recreation facilities and programs, among other programs. Thus, the effort to revive the Center was delayed. A 2012 campaign to adopt a parcel tax for local parks and recreation projects and operations was yet another attempt to generate funds for the Center renovation. The Center was included as a priority project of the Measure X campaign. However, the measure, which required a two-thirds majority yes vote to pass, was narrowly defeated, achieving a 61.9% yes vote. DISCUSSION While the City's available funds for parks and recreation facilities and programs have declined, the demand for services has not. Since 2007, the life -blood of Petaluma parks and recreation facilities and programs has been City partnerships with self-sustaining, non-profit groups who have provided a crucial array of support services and fund raising for parks and recreation. Some examples of successful partnerships and partnership programs include: • Petaluma Wetlands Alliance Support at Petaluma's Wetlands • Miracle League of North Bay Development of facilities at Lucchesi Park • Petaluma Small Craft Coalition Development of the Floathouse and Community Boathouse • Friends of the Petaluma River Restoration of River Heritage Center and Other Support • Mentor Me Petaluma Restoration and Operations of Cavanagh Recreation Center City staff has concluded that the only currently -feasible approach for renovating and operating the Center is the development of a public/private partnership that can convert the Center from a City liability into a community asset. K The Polly Klaas Foundation ("Foundation") is a Petaluma -based, national nonprofit dedicated to the safety of all children, the recovery of missing children, and public policies that keep children safe in their communities. According to the Foundation's website, since its founding in 1993, the Foundation has used compassion, experience and professionalism to help more than 10,000 families find missing children. The Foundation has consistently expressed an interest in the status of the Center. As a result, City staff has been engaged in discussions with Foundation staff for nearly 2 years regarding a potential partnership in support of the Center. During this time, approximately $6,000 left by the Theater Company has been used to analyze the Center and develop renovation renderings. As costs of an initial renovation became better known, and as Foundation staff began to consider available options, discussions began to focus on a partnership. In January 2018, City staff proposed a potential partnership to the Foundation Board, following which the Foundation expressed a strong desire to assume full responsibility for renovation, maintenance and operations as owners of the Center. The Foundation appears uniquely positioned to assume such a partnership role that can prevent demolition by neglect of what can become an important community asset. The Foundation indicates a strong desire to assure a lasting and appropriate tribute to Polly Klaas. The Foundation is an appropriate partner to lead this effort, and in doing so, can provide recreational opportunities and a safe place for Petaluma youth. The proposed partnership would include a Foundation capital campaign, and conveyance of the Center and the Property upon conclusion of the funding campaign, subject to purchase and sale conditions and deed restrictions intended to protect the public's interest in the availability and sound management of the Center as a permanent tribute to Polly Klaas and the Foundation's service mission in her memory. The City would also contribute the funds it is holding for renovation of the Center. The property transfer would require adoption of an ordinance to satisfy City Charter requirements. The transactional documents effecting the property transfer, following successful completion of Foundation fundraising efforts, would prescribe deal terms, and include a purchase and sale agreement and quitclaim deed, and assurances that use of the facility continues as intended. The proposed deal points include: 1) Transfer from the City to the Foundation of funding in the amount of $65,000 to assist the Foundation in launching a capital campaign to raise funds for Center renovations and maintenance. 2) The Foundation raising $1,000,000 towards a total $1, 200,000 fundraising goal before the conveyance of the property. The funding efforts are anticipated to raise both cash and in- kind contributions. 3) Following a successful fundraising campaign generating a total value of $1,000,000 in cash and in-kind donations, the City conveying the Center and the Property to the Foundation for the appraised value of $18,500 and the City releasing to the Foundation the remaining renovation funds totaling approximately $105,000 held by the City from previous fundraising efforts. 4) A long-term parking agreement between the City and the Foundation to give Center programs and activities access to needed parking in the City Hall parking areas during times of low use. 5) City review and approval proposed building renovations including by the Planning Commission, Historic and Cultural Preservation Committee, and Building Department as required to for code compliance and building safety and to ensure that the integrity of the historic building is retained. 6) Safeguards in the transactional documents to assure that the Center will continue to operate as a youth oriented performing arts center and a memorial to Polly Klaas in perpetuity. Adoption of the attached resolution of intent would provide support for Foundation fundraising efforts and provide direction to City staff regarding development of terins of sale and transactional documents to be brought before the Council for review and approval. PUBLIC OUTREACH The Recreation, Music and Parks Commission considered the partnership proposal at their regular meeting in December 2018 and supported the project and the building sale once the Foundation has successfully raised $1,000,000 toward the needed $1,200,000 to renovate the Center. FINANCIAL IMPACTS A fund balance of $170,000 is held in a City donation account for use in the Center renovation. Upon adoption of the attached resolution, $65,000 would be transferred from the City to the Foundation for use in the capital campaign. If the capital campaign is successful, the remaining fund balance would be transferred for use in the renovation, subject to the sale and other terms approved by the City Council. ATTACHMENTS 1. Resolution 0 ATTACHMENT 1 RESOLUTION OF INTENT TO CONVEY THE POLLY KLAAS PERFORMING ARTS CENTER PROPERTY AND $65,000 IN RENOVATION FUNDING TO THE POLLY KLAAS FOUNDATION SUBJECT TO THE FOUNDATION RAISING $1 MILLION FOR RENOVATIONS AND OTHER SPECIFIED CONDITIONS. WHEREAS, the Polly Hannah Klaas Performing Arts Center ("Center"), constructed in 1910-1911, is located at 417 Western Avenue, identified as Assessor Parcel Number 008-043- 001, on the triangular parcel that lies between the intersections of English Street, Post Street and Western Avenue ("Property"), directly across English Street from Petaluma City Hall in the City of Petaluma; and WHEREAS, in 1971, the City of Petaluma agreed to purchase the Property from the Christian Church of Petaluma for $22,500, with the intention of demolishing the structure and utilizing the site for parking to support City Hall expansion; and WHEREAS, following acquisition by the City, concerned citizens launched a campaign to save the facility, which was assigned to the Recreation Department, referred to as the Five Corners Community Center, partially renovated with a roof replacement and electrical upgrades, and used for recreation activities that included performing arts; and WHEREAS, in January 1994 the City Council adopted Resolution 94-13 N.C.S. naming the building on the Property the Polly Hannah Klaas Performing Arts Center and declaring the City Council's intent to establish a lasting tribute to Polly Hannah Klaas, citing the Center as an appropriate remembrance because theater and the performing arts held a special place in the heart of Polly Klaas, and further declaring that "the memory of this special child will forever be a part of the community of Petaluma;" and WHEREAS, several attempts have been made to generate revenue to renovate and operate the Center for the purpose of providing a venue for youth performing arts, including those of the non-profit group Polly Hannah Klaas Performing Arts Theater Company ("Theater Company") that were derailed in 2004 when its executive director was found guilty of embezzling funds from the group; and WHEREAS, a further attempt to partner with Cinnabar Theater for Center renovations and operation failed when the economy weakened in 2008 and 2009 and the Theater withdrew from discussions in order to concentrate on assuring funding to continue existing operations; and WHEREAS, a 2012 campaign to adopt a parcel tax for local parks and recreation projects included the Center as a priority project, but was narrowly defeated despite achieving a 61.9% yes vote; and WHEREAS, in approximately 2007, the Center's fire rating was changed from Assembly Occupancy to Storage, in part because many of the building's safety features require maintenance, repair or upgrades, making it was unsafe for large gatherings; and WHEREAS, the City continues to hold nearly $170,000 raised by the Theater Company for Center renovations; and WHEREAS, thePolly Klaas Foundation• oPetaluma-based, national nonprofit dedicated t• the safety of all ` • of • and public policies that keep childrenacommunities; and according to the Foundation'swebsite,• • in 1993, Foundation has used compassion, experience and professionalism to help more than 10,000 families i missing children;and WHEREAS, the Foundation has consistently expressed an interest in the status of the Center and City and Foundation staff have been engaged in discussions for nearly 2 years regarding a potential partnership in support of the Center; and WHEREAS, approximately $6,000 of funds held by the City for renovation of the Center has been used to analyze the Center and develop renovation renderings; and WHEREAS, in January 2018, City staff proposed a potential partnership to the Foundation Board; and WHEREAS, the Foundation has expressed its intent to acquire the Property from the City and to renovate and operate the Center on the Property as a youth -focused performing arts and community center; and WHEREAS, the $170,000 the Theater Company previously raised for Center renovations is well short of the estimated $1.2 million needed to rehabilitate the Center; and WHEREAS, the Foundation appears uniquely positioned to assume a partnership role with the City that can prevent demolition by neglect of the Center, instead helping it become an important community asset that provides recreational opportunities and a safe place for Petaluma youth; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Petaluma as follows: 1. The City Manager is hereby authorized and directed to oversee transfer from the City to the Foundation of funding in the amount of $65,000 raised by the Theater Company for renovation of the Center to assist the Foundation in launching a capital campaign to raise funds for Center renovations and maintenance. 2. The City Manager and the City Attorney are hereby authorized and directed to work with the Foundation Board and staff to establish the details of a partnership between the City and the Foundation intended to protect the public's interest in the availability and sound management of the Center as a youth oriented performing arts center and a permanent tribute to Polly Klaas and the Foundation's service mission in her memory. The proposed partnership should include a Foundation capital campaign, conveyance of the Center and the Property to the Foundation upon conclusion of the campaign, and contribution the remaining funds the City is holding for renovation of the Center to the project, subject to appropriate purchase and sale and conditions and deed restrictions in accordance with this resolution of intent. 3. Staff are hereby directed to return to the City Council with transactional documents for implementing the proposed City/Foundation partnership for renovation and operation of the Center. The transactional documents should include an ordinance for effecting property transfer in accordance with City Charter requirements, and a purchase and sale agreement and quitclaim deed, and such other documents as may be necessary and appropriate and should include safeguards ensuring that the intended use of the Center will continue as a permanent use. The transactional documents should implement and include the following requirements: a. Acknowledgment of transfer from the City to the Foundation of funding in the amount of $65,000 to assist the Foundation in launching a capital campaign to raise funds for Center renovations and maintenance. b. The Foundation raising $1,000,000 in cash and in-kind contributions towards the total $1,200,000 fundraising goal before the conveyance of the Property. c. Following a successful capital campaign generating a total value of $1,000,000 in cash and in-kind donations, the City conveying the Center and the Property to the Foundation for the appraised value of $18,500 and the City releasing to the Foundation the remaining renovation funds totaling approximately $105,000 held by the City from previous fundraising efforts. d. A long-term parking agreement between the City and the Foundation to give Center programs and activities access to needed parking in the City Hall parking areas during times of low use. e. City review and approval of proposed building renovations including by the Planning Commission, Historic and Cultural Preservation Committee, Building Department and other departments as required to assure code compliance and building safety and to ensure that the integrity of the historic building is retained. f. Safeguards in the transactional documents to assure that the Center will continue to operate as a youth oriented performing arts center and a memorial to Polly Klaas and the Foundation's service mission in her memory in perpetuity. g. Satisfaction of all substantive and procedural requirements that apply to the proposed partnership, sale, and renovation, including state law requirements (including California Environmental Quality Act requirements), City Charter and Municipal Code requirements, and other applicable requirements.