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HomeMy WebLinkAboutMinutes 2014-03-19 @6:00 SPECIAL MEETING °� �. MINUTES s» t!v o CITY COUNCIL c q Fo OF THE CITY OF SOUTH SAN FRANCISCO P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, California 94083 Meeting to be held at: CITY HALL CONFERENCE ROOM 400 GRAND AVENUE SOUTH SAN FRANCISCO, CA WEDNESDAY, MARCH 19, 2014 6:00 P.M. Purpose of the meeting: 1. Call to Order. Time: 6:02 p.m. 2. Roll Call. Present: Councilmembers Addiego, Gupta and Normandy, Vice Mayor Garbarino and Mayor Matsumoto Absent: None. 3. Public Comments—comments are limited to items on the Special Meeting Agenda. Mayor Matsumoto reviewed the meeting protocol and explained the process for public comments. After concluding the study sessions additional comments and questions could be made. Bruce Wright spoke in relation to item 5 (b) and on behalf of the Rotary Plaza, providing clarification on the funding of the proposed project. He gave specific steps and figures that were up coming. He also emphasized that other sites and listed them. After analyzing, it was concluded that the 300 block of Miller best fits their project. He went on to clarify the characteristics and timing expectations of the project and provided a description of the potential residents' financial situations. Deborah Justinson, current administrator at Rotary Plaza, spoke on its behalf and on the need for affordable housing. With a waiting list 221 applications, the need for another facility was evident. Tracy Choi of the Housing Leadership Council of San Mateo County reiterated her statements from the previous study session, commenting on the benefits of providing housing to lower and middle income residents in the downtown area. She noted a series of studies that showed that local jobs were supported by senior housing development and her belief that the project, with a healthy mix of housing options, would provide a good way to help local businesses. Edward Koaler, resident of Rotary Plaza,believed there was a need for more low income housing. He clarified that residents were charged rent based on their income and that without Rotary, he would be out in the street. He felt they provided a lot of good things for the community and there should be more housing for the elderly. 4. Agenda Review. No changes. 5. Study Session: Economic Development Strategy: a. Proposed marketing program for the 2014 Bio International Convention in San Diego. Economic and Community Development Consultant reviewed the staff report, which contained details about the proposed marketing program for the 2014 Bio International Conference that would be occurring at the end of June. Items discussed in detail included the City's booth features and placement,pre/during/post-conference meetings, and marketing/promotional materials and strategies. Expenses included $16,000 for the bio-tech package and $8,000 for creative concept and messaging. These figures were in addition to funds already spent. Feedback and direction was requested. Council comments focused on the importance of maximizing the benefits of the City's attendance of the conference. Feedback was given on the placement and features they wanted for the booth, materials to be made available, and the preference for outreach and promotional material to be substantial and up to trend. Potential of hosting a breakfast was discussed and it was requested that a senior level staff person be appointed to provide follow up on serious connections made at the Conference. Council saw potential for the City's uncommon factors, such as mature infrastructure and current critical mass, to be highlight at the conference. Council also wanted to be assured that facilities would also be available to hold one-on-one meetings if the circumstances were called for. Consultant O'Keeffe understood the importance of the Councilmember's suggestions and would do his best to have the implemented and added that any other comments would be greatly appreciated. He asked Council if they were ok with the $8000 and the Bio-tech package. Council responded affirmatively. Interim City Manager Mattas stated that if Council was okay with the concept and price range for staff could come back with some additional options. Mayor Matsumoto thanked him and stated that they support the concept. SPECIAL CITY COUNCIL MEETING MARCH 19,2014 MINUTES PAGE 2 b. Proposed development of 310-320 Miller Avenue. Consultant O'Keeffe reviewed the four options to consider for the 310-320 Miller site: Option 1: proceed to development agreement with the Brookwood group for a 55-unit mixed income development, 80%market rate, 20% affordable. Option 2: proceed to a negotiation agreement with the Rotary Club for a 69-unit, 100% affordable senior development. Option 3: add some more sites to the discussion, have Rotary proceed on the 310 Miller site,have Brookwood proceed on two other sites, Grand Cypress and 418 Linden. Option 4: start over and do a request for proposals on any or all of those parcels. He reviewed the specifics of the sites, the development teams and the financial aspects and each development. Noticing the material being reviewed was not in her packet, the Mayor directed that all future power point presentations be included as part of the staff report. If they were available ahead of time, she would like them ahead of time as well. Direction was received by staff. Councilmember Addiego requested the updated financials be highlighted. Consultant O'Keeffe, focusing on Brookwood, stated the contribution requested was the land, valued at about $1.2 million and an additional $2.4 million of cash assistance, either 100% from the City or a blend of the City providing $1 million loan and $1.4 million grant from HEART, totaling $3.6 million in assistance for the proposal. The City would potentially get all of it back with interest if the project performed well but that could not be guaranteed. After a 5-7 years holding period, there will be a refinancing of the project, either sold and the original lenders get cashed out or the owner keeps it and they refinance it. At that point, the bank that provided the loan gets paid first, followed by the equity lenders and then the City for its equity contribution of land and cash. He stated that it has to perform well at the end in order to see that money. Council sought clarification on whether Brookwood intended to hold the units as rentals and mentioned the possibility of condominium conversions. Mr. Shephard Heery, Chief Executive of the Brookwood Group, stated the intent was to map them as condominiums from the outset but operate it as a rental income property for the first ten years. Brief discussion was help on the risk and exposure for the developer in regards to condos as well as the current market for rental units, which was currently up. Councilmember Addiego sought further clarification as to what the turnover number would be for the City to recoup its money. Consultant O'Keeffe stated a pro forma had been provided with certain assumption of rent increases and an applied capitalization rate. That gets deducted to yield an overall project value. Staff had reviewed the numbers and felt comfortable, but didn't want to oversell. Brookwood Project Manager, Jelani Dotson reviewed the formula used to generate the overall SPECIAL CITY COUNCIL MEETING MARCH 19,2014 MINUTES PAGE 3 project value and added that the market would determine if it made better financial sense to execute as condos upon completion of the project. Mr. Heery stated there would be a collaborative relationship with the City in terms of the design itself to make sure the design objectives were being met. Consultant O'Keeffe moved on to the Rotary financials, with the same amount proposed in land contribution at$1.2 million and an amount from the City or an outside source,but a smaller amount, $1 million instead of$2.4 million. The reason for the big difference was that Rotary had $10 million to invest in their own equity. Discussion was then had about option 3, dividing up the two developers on different sites. Rotary would proceed with 310-320 Miller and Brookwood could shift over to doing a combined project of the Grand Cypress and the 418 Linden sites. The Grand Cypress was a Redevelopment parcel and Linden is a City parcel. The City's affordable housing obligations were discussed as was the option of going out to bid for the project. Interim City Manager Mattas stated if Council chose to go out for RFP something similar to what occurred with the Ford properties; interest in bidding, paying for the land and building at prevailing wage. While the market was better you don't know what kind of response you are going to get until you actually issue the RFP. The inclusion of ground floor retail was brought up for discussion. Consultant O'Keeffe stated that having that ground floor retail on a retail street was really important,but trying to impose that requirement on a street that was not a retail street was a non-starter, providing the Miller Avenue Garage as an example of the chance for it to become vacant retail. The places that it should be required included Grand Avenue because that was an established retail street. For the Cypress Grand parcel, it was important to have some ground floor retail there but the Miller parcels for Ford were not good areas for retail and neither was Linden Avenue. Based on direction from Council the following, Interim City Attorney Rosenberg prepared the following motion: A motion to direct staff to negotiate an exclusive negotiating rights agreement with Rotary for the development of the 310-320 Miller Avenue parcels as well as negotiate a collaborative development agreement with Brookwood for the development of two mixed income housing development projects at Grand Cypress and 418 Linden, all based on the direction provided by Council tonight. Motion—Vice Mayor Garbarino/Second—Councilmember Normandy. Unanimously approved by roll call vote. . 6. Study Session: Discussion of ordinance related to downtown smoking ban. Interim City Attorney Jason Rosenberg provided a brief background on the history of the potential ordinance. California had given cities full control of how far to go on bans on second hand smoke, and in 2010, the City considered banning second hand smoke in downtown areas SPECIAL CITY COUNCIL MEETING MARCH 19,2014 MINUTES PAGE 4 which did not go any further. In 2013, an update was adopted consistent with state law, but did not include a ban in the downtown area. The matter was coming before Council again to get an idea of Council's interest in creating a more inclusive ban. Interim City Manager Mattas noted the last time this had been brought forth there had been opposition from downtown business so this time there would be an outreach component included if Council directed. Council stated they would like to hear from the business owners. Mayor Matsumoto stated that she was the one who initiated this for downtown as many cities were moving towards smoke free environments. Interim City Attorney Rosenberg recalled the process from 2010. Draft language allowed smoking in the 2nd and 4th lanes and alleys and funding for smoke receptacles that dispose of butts in an environmentally friendly way were being looked into. Interim City Manager Mattas mentioned that the Solid Waste fund could potentially be used for such a purpose. The fund was believed to be fairly healthy but the exact amount available was unknown. Further comments from Council expressed their preference for the ordinance to not be too onerous for the Police Department. Questions covered the topics of current enforcement issues, signage options, the merchant/community outreach plan, and regulations related to electronic smoking devices. Interim City Attorney Rosenberg clarified the current ban and explained that to go further with the ban downtown, they would need to actually cover sidewalks and areas that are not city-owned but public areas. There would be a provision added to the ordinance that would to apply to the use of electronic smoking devices in city facilities. Interim City Manager Mattas stated enforcement would largely be complaint driven, though bike patrol might stop if they see someone smoking. Signage would be needed but could be relatively modest. Examples could be brought back with any draft version of the ordinance. Regarding public outreach,he thought there was an opportunity to coordinate with Maria Martinucci through the South San Francisco Chamber of Commerce to gather input from local merchants. This would help gauge the depth of support or opposition. Brief discussion was held about perhaps pursuing an ordinance relative to smoke free apartments and a request for further information was made. Interim City Manager Mattas advised that,based on his recent experience with other cities; Council should expect strong feelings on either side of the issue. Council provided direction to continue with preparing a draft ordinance related to a smoking ban and conduct public outreach. SPECIAL CITY COUNCIL MEETING MARCH 19,2014 MINUTES PAGE 5 7. Adjournment. Being no further business, Mayor Matsumoto adjourned the meeting at 8:21 p.m. Submitted by: Approved by: • Anna M. Brown, Deputy City Clerk aryl sumoto, Mayor City of South San Francisco City of South San Francisco SPECIAL CITY COUNCIL MEETING MARCH 19,2014 MINUTES PAGE 6