HomeMy WebLinkAboutMinutes 2004-05-19 MINUTES
CITY COUNCIL
CITY OF SOUTH SAN FRANCISCO
SPECIAL MEETING
CITY HALL CONFERENCE ROOM
400 GRAND AVENUE
WEDNESDAY, MAY 19, 2004
o
(Cassette Tape No. 1)
Call to Order
Roll Call
6:05 p.m.
Present:
Councilmembers Femekes, Garbarino and
Gonzalez* and Mayor Matsumoto
Absent:
Vice Mayor Green (excused)
*Councilman Gonzalez arrived at 6:15 pm
Staffpresent:
City Manager Wilson, Assistant City Attorney
Johnson, Assistant City Managers Nagel and
Van Duyn, Finance Director Steele,
Conference Center Director O'Toole
Others present:
Laurie Masetti, Jim Metz, Peter Grenell,
Dalton Smith, Robert Erskine (Amoroso
Construction), Michael Flynn (DMJM
Design), Steve Howard (Leyman Bros.);
Emily Fancher (SMCo. Times)
Public Comments
Study Session: Oyster Point Hotel Proposal - Dalton Smith, Developer
City Manager Wilson gave a brief synopsis of the previous development proposals (Raiser
and Corporex) to build a full service hotel at Oyster Point Marina. He further stated that
Mr. Dalton Smith expressed an interest two and a half years ago to build a full service hotel
and has been working with staff recently to explore the feasibility of tying in a conference
center.
Mr. Smith, president of Public Project Management, gave an overview (Power Point
presentation) of the 332 rooms, ten story, full service hotel proposal, with Hilton Hotels as
the operator. He reviewed conceptual drawings, the site plan and land improvements, site
contamination issues, financing and terms of agreement with the City, and presented the
project design team. He explained the public-private partnership proposal, that the non-
profit organization is eligible for tax-exempt bonds and that the 8% TOT generated by the
hotel will help pay off the bonds. Messrs. Smith and Flynn provided brief information on
the conference center site plan.
Design team members, Messrs. Erskine, Flynn and Howard reviewed their companies'
portfolio of projects and experience.
Mr. Smith stated that the business community is underserved in the East of 101 area and is
in need of a high quality hotel. He stated that in order to move forward with the project he
is requesting a memorandum of understanding with the City that includes an agreement to
pledge the TOT to the bonds. He stated that the convention center is a separate issue
requiring a lease agreement and a separate bond issue, but would be accomplished with the
same non-profit status. He added that the non-profit status has been approved by the IRS.
(Recess: 7:05 p.m. - 7:12 p.m.)
Councilman Gonzalez questioned the non-profit status determination by the IRS, the range
of view the hotel will capture, and suggested a cocktail lounge on the top floor be included.
Councilman Fernekes concurred with the cocktail lounge suggestion and that it would be
advantageous both for the operator and city. He stated that he was not ready to make a
decision tonight. He asked what the next step in the process would be if Council concurred
and City Manager Wilson stated that there are a number of steps, including an owner
participation agreement which would include the Harbor District, and initating the
planning/design review process. He further stated that the conference center consultant
(Mark Tobin) would need to be involved to look at the economics of the project.
Councilman Femekes stated that a quality project is a priority and that a more detailed
design presentation, such as a model, is recommended. He questioned the financing, the
TOT commitment and whether the proposed 1% TOT increase is included.
Councilman Garbarino questioned the landfill issue (methane gas) and the City's liability
for exposure. Mr. Smith responded that borings indicate all is benign, but there can always
be a surprise. He stated he is prepared to do remediation work. Councilman Garbarino
suggested a model be prepared, and Mr. Flynn responded that a computerized model could
be created.
Mayor Matsumoto stated she supports the project and questioned if construction costs took
into consideration prevailing wage requirements, and Mr. Erskine stated it was assumed.
She further questioned the timeline, and Messrs. Erskine and Smith stated Summer 2005 is
anticipated, but it may be as early as Spring. Other concerns Mayor Matsumoto mentioned
were BCDC permits, and if other projects of this type have succeeded or failed in the last
ten years. Mr. Howard stated that the information was not immediately available, but
recalled a project in Sacramento. He stated the information would be forwarded to
Council. Director Steele stated he was particularly interested in projects in California.
Councilman Gonzalez asked if a childcare facility is included for employees and Mr. Smith
stated that he believes Hilton does participate in a program for providing childcare through
an employee cafeteria plan.
SPECIAL CITY COUNCIL MEET1NG MAY 19, 2004
MINUTES PAGE 2
After a discussion on a plan for moving forward, Council concurred to set a date in July for
a second meeting on the proposal; in the meantime informational data will be provided to
Council to consider.
5. Adjournment
Being no further business, Mayor Matsumoto adjourned the meeting at 7:55 pm.
Submitted by:
S/S~ylv~i M. Payne, City Clerk
City of South San Francisco
~.~r.~, K~~ayor
City of South San Francisco
SPECIAL CITY COUNCIL MEETING MAY 19, 2004
M1NUTES PAGE 3