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Home My WebLink AboutRDA Minutes 2011-06-22 4)- � S� SPECIAL MEETING am fElon MINUTES J �O REDEVELOPMENT AGENCY 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: MUNICIPAL SERVICES BUILDING COMMUNITY ROOM 33 ARROYO DRIVE WEDNESDAY, JUNE 22, 2011 1. Call to Order. Time: 6:34 p.m. 2. Roll Call. Present: Boardmembers Addiego and Gonzalez, Vice Chairman Garbarino and Chairman Mullin. Absent: Boardmember Matsumoto. 3. Agenda Review. Executive Director of the Agency Nagel recommended that items 6 and 7 be held over and heard contemporaneously with the budget items included on the City Council Agenda for the evening. Boardmembers agreed. 4. Public Comments — comments are limited to items on the Special Meeting Agenda. None. CONSENT CALENDAR 5. Submittal of Annual Redevelopment reports to the State Controller as required by California Health & Safety Code 33080.1. Motion— Boardmember Garbarino /Second— Boardmember Gonzalez: to approve Consent Calendar Item No. 5. Approved by the following voice vote: AYES: Boardmembers Addiego and Gonzalez, Vice Chairman Garbarino and Chairman Mullin. NOES: None. ABSTAIN: None. ABSENT: Boardmember Matsumoto. CLOSED SESSION 8. Real Property Negotiations (Pursuant to Government Code Section 54956.8) Agency Negotiator: Marty Van Duyn related to: 315 -321 Airport Blvd. Owner: The Gonzalez Family Trust 401 Airport Blvd. Owner: The Gonzalez Family Trust 411 Airport Blvd. Owner: The Gonzalez Family Trust 421 Airport Blvd. Owner: The Gonzalez Family Trust 216 Miller Avenue Owner: The Gonzalez Family Trust 405 Cypress Avenue Owner: The Gonzalez Family Trust Closed Session opened: 6:36 p.m. Meeting resumed: 6:55 p.m. Report out of Closed Session: Chairman Mullin requested that Attorney Mattas relay the action taken in closed session. Attorney Mattas advised the RDA was briefed on modifications to a purchase agreement between the Gonzalez Family Trust, the City and the Agency. By a 4 -0 vote the Redevelopment Agency approved the changes attached to these minutes. Recess: 6:56 p.m. Meeting resumed: 8:37 p.m. SPECIAL REDEVELOPMENT AGENCY MEETING JUNE 22, 2011 MINUTES PAGE 2 ADMINISTRATIVE BUSINESS 6. Resolution 24 -2011 approving the Redevelopment Agency Operating Budget for 2011- 2012. After hearing the staff report that Budget Manager Tribby presented to the City Council and the Redevelopment Agency Board simultaneously, the Agency took the following action: Motion— Boardmember Garbarino /Second— Boardmember Gonzalez: to approve Resolution No. 24 -2011. Approved by the following voice vote: AYES: Boardmembers Addiego and Gonzalez, Vice Chairman Garbarino and Chairman Mullin. NOES: None. ABSTAIN: None. ABSENT: Boardmember Matsumoto. ** See Minutes of the Regular City Council Meeting of June 22, 2011 for a summary of the staff report and discussion on this item. 7. Resolution Providing Interim Spending Authority for the First 60 Days of the 2011 -12 Fiscal Year. Item not heard. 8. Adjournment. Being no further business, Chairman Mullin adjourned the meeting at 8:59 p.m. Submitted Ap ro ed: Nor MAALIA1 i ' to Marti 11 K vin Mullin Clerk Redevelopment Agency Chairman City of South San Francisco City of South San Francisco SPECIAL REDEVELOPMENT AGENCY MEETING JUNE 22, 2011 MINUTES PAGE 3 3. Conveyance of Title. At the close of escrow for conveyance of the Property to Buyer ( "Close of Escrow "), Seller shall convey by grant deed to Buyer marketable fee simple title to the Property, free and clear of all recorded and unrecorded liens, encumbrances, assessments, leases and taxes except: (a) Taxes for the fiscal year in which the escrow for this transaction closes, which shall be prorated as of the Close of Escrow and handled in accordance with Section 4986 of the California Revenue and Taxation Code; (b) The Redevelopment Plan for the Project Area; and (c) The items described as exception numbers in that certain preliminary report for the Property dated 20 and issued by Title Company (collectively, together with such other title exceptions as Buyer may approve in writing, the "Permitted Exceptions "). Without limiting the generality of the foregoing, Seller shall convey the Property to Buyer free and clear of all monetary liens and encumbrances, including without limitation, liens relating to delinquent taxes and assessments, deeds of trust, and other security instruments. 4. Escrow; Escrow Instructions. Within five (5) business days following the Effective Date, the Parties shall open an escrow to consummate the purchase and sale of the Property pursuant to this Agreement at the office of Title Company located at Street, , CA ( "Title Company" or "Escrow Agent ") or such other title company as may be mutually agreed upon by the Parties. Upon the opening of escrow, the Parties shall deposit with the Escrow Agent an executed copy of this Agreement, which shall serve as the joint escrow instructions of Buyer and Seller for this transaction, together with such additional instructions as may be executed by the Parties and delivered to the Escrow Agent. 5. Earnest Mone De I osit. D • i osit of Purchase Price. Upon the opening of escrow and in no event later than seven (7) business days after the Effective Date, BuyerAgency shall deposit the sum of five thousand Dollars ($5,000) (the "Deposit ") into escrow in an interest bearing account for the benefit of Buyer. The Deposit, and all interest earned thereon, shall be applied to the Purchase Price at the Close of Escrow. Agency will deposit the balance of the Purchase Price less the amount of the Remediation Cost Estimate (subject to and as defined in Section 12.1) into escrow in an interest bearing account for the benefit of Buyer within sixty (60) days following the Effective Date. If escrow fails to close because this Agreement is terminated in accordance with Section 13 or because of non - satisfaction of Buyer's closing conditions in Section 11, this Agreement shall terminate, the Deposit and all interest earned thereon and all other sums deposited into escrow by or on behalf Buyer shall be returned to Buyer, and thereafter neither Seller, Buyer, nor BAgency shall have any further obligations hereunder except as expressly set forth herein. 6. Title Documents. By not later than ten (10) business days following the Effective Date, Buyer shall obtain an updated title report for the Property ( "Title Report "). Buyer shall 1666030 11605181.1 2 approve or disapprove each title exception, as set forth in the Title Report within twenty (20) days following the Effective Date. Buyer's failure to approve the Title Report within such time period shall be deemed to be a disapproval of the title exceptions. If Buyer objects to, or is deemed to have disapproved any title exception, Seller shall use its best efforts at Seller's sole expense to remove from title or otherwise satisfy each such exception no later than fourteen (14) days prior to the Close of Escrow and in a form that is reasonably satisfactory to Buyer. If Seller fails to remove or satisfy any title exception to the satisfaction of Buyer, Buyer shall have the option, in its sole discretion, to terminate this Agreement, or to accept title subject to such exception. If Buyer elects to terminate this Agreement, the Purchase Pricc,Deposit and all other funds and documents deposited into escrow by or on behalf of Buyer shall be returned to Buyer, and thereafter neither Seller nor, Buyer, nor Agency shall have any further obligations hereunder except as expressly set forth herein. It shall be a condition to the Close of Escrow that Title Company shall deliver to Buyer no later than five (5) business days prior to the Close of Escrow, a title commitment for a CLTA Owner's Title Insurance Policy ( "Title Policy ") (or at Buyer's election, an ALTA Owner's Title Insurance Policy) to be issued by Title Company in the amount of the Purchase Price for the benefit and protection of Buyer, showing fee simple title to the Property vested in Buyer, subject only to the Permitted Exceptions, including such endorsements as may reasonably be requested by Buyer, and committing Title Company to issue the Title Policy to Buyer upon the Close of Escrow. 7. Closing Documents and Funds. (a) Seller. (A) By no later than two (2) business days prior to the Close of Escrow, Seller shall deposit into escrow all of the following: (i) A Grant Deed, substantially in the form attached hereto as Exhibit B ( "Grant Deed "), duly executed and acknowledged, conveying to Buyer fee simple title to the Property, subject only to Permitted Exceptions; (ii) A bill of sale, executed by Seller in form acceptable to Buyer, conveying to Buyer Seller's interest in the personal property identified therein (the "Bill of Sale "); (iii) Seller's affidavit of non - foreign status and Seller's certification that Seller is a resident of California, each executed by Seller under penalty of perjury as required by state and federal law; (iv) An Assignment of Leases, executed by Seller in form acceptable to Buyer, conveying to Buyer Seller's interest in the leases and rental agreements identified therein (the "Assignment of Leases "); 1666030.11 605181.1 3 (v) Evidence that all utilities payable with respect to the Property have been paid prorated as of the Close of Escrow; (vi) Tenant Estoppels (as described in Section 13.d); (vii) All original leases, rental agreements and /or contracts to be assumed by Buyer; (viii) If applicable, an Assignment of Contracts, executed by Seller in form acceptable to Buyer, conveying to Buyer Seller's interest in the contracts identified therein (the "Assignment of Contracts "); and (ix) Such additional duly executed instruments and documents as the Escrow Agent may reasonably require to consummate the transaction contemplated hereby. (B) Unless Seller elects to have the following charges deducted from the funds to be distributed to Seller at Close of Escrow, no later than one (1) business day prior to Close of Escrow, Seller shall deposit into escrow immediately available funds in the amount necessary to pay: (i) funds in the amount necessary to pay Seller's share of closing costs the-Title-Policy in accordance with Section 9 below; and (ii) all costs and expenses payable pursuant to Section 25 below. (b) Buyer and Agency. (A) By no later than two (2) business days prior to the Close of Escrow, Buyer shall deposit into escrow all of the following: (i) A duly executed Certificate of Acceptance in the form shown in Exhibit B, as required by California Government Code Section 27281; (ii) If applicable, the Assignment of Leases, executed by Buyer; (iii) If applicable, the Assignment of Contracts, executed by Buyer; and (iv) Such additional duly executed instruments and documents as the Escrow Agent may reasonably require to consummate the transaction contemplated hereby. (B) No less than one (1) business day prior to the Close of Escrow, Agency shall deposit into escrow immediately available funds in the amount equal to 1666030.11605181.1 4 - . . orations- between the Parties: and(ii) funds in the amount necessary to pay Buyer's share of closing costs and the cost of the Title Policy in accordance with Section 9 "below, subject to any prorations bemeen the Parties. 8. Close of Escrow. The Parties intend to close escrow by August 31, 2011, provided that all of Buyer's conditions to closing (described in Sections 11 and 13 below) have been satisfied by such date, unless this Agreement is terminated pursuant to the terms hereof or extended by mutual agreement of the Parties. The Escrow Agent shall close escrow by: (i) causing the Grant Deed to be recorded in the official records of San Mateo County, California; (ii) issuing the Title Policy and delivering same to Buyer; (iii) delivering to Seller the monies constituting the Purchase Price less prorated amounts and charges to be paid by or on behalf of Seller; (iv) delivering to Buyer a conformed copy of the Grant Deed indicating recording information thereon; and (v) delivering to Buyer, if applicable, the Bill of Sale, Assignment of Leases, and the Assignment of Contracts, each executed by Seller. Possession of the Property shall be delivered to Buyer at the Close of Escrow. 9. Closing Costs. Each PartyBuyer and Seller shall each pay one -half (1/2) of all escrow fees. Seller shall pay all governmental transfer taxes and conveyance fees and Buyer will pay all recording fees. Buyer Seller will pay the cost of the Title Policy._; however. if Buyer elects to II Y. .• Y V • r . . .. . . ♦ .... • ♦ W .. . V . • and the cost of any required survey. ✓ 10. Prorations. Property taxes shall be prorated as of the Close of Escrow based upon the most recent tax bill available, including any property taxes which may be assessed after the Close of Escrow but which pertain to the period prior to the transfer of title to the Property to Buyer, regardless of when or to whom notice thereof is delivered. 11. Buyer's Conditions to Closing. The Close of Escrow and Buyer's obligation to purchase the Property are conditioned upon satisfaction (or Buyer's waiver, exercisable in Buyer's sole discretion) of each of the following: (i) the performance by Seller of each obligation to be performed by Seller under this Agreement within the applicable time period, or the waiver by Buyer of such obligation; (ii) Seller's representations and warranties contained in this Agreement being true and correct as of the Effective Date and the Close of Escrow; (iii) the commitment by Title Company to issue and deliver the Title Policy in the form required by Buyer pursuant to Section 6, subject only to the Permitted Exceptions; (iv) Buyer's approval of the condition of the Property and other matters pursuant to Section 13; #--(v) approval of the purchase of the Property by Buyer's governing board:; and (vi) completion of both a Phase 2 environmental analysis of the Property and a cost estimate for remediation of Hazardous Materials on the Property pursuant to Section 12.1. Should any condition to closing fail to occur, excepting any such conditions that have been waived by Buyer, Buyer shall have the right, exercisable by giving written notice to Seller, to cancel the escrow, terminate this Agreement, and recover the Deposit and all other funds deposited into escrow b or on behalf of Buyer, together with all interest earned thereon and any and all other amounts paid by Buyer to Seller or deposited with the Escrow Agent by or on behalf of Buyer, and thereafter, neither Seller, Buyer nor Agenc shall have an further 1666030.11605481.1 5 obligations hereunder except as expressly set forth herein. The exercise of this right by Buyer shall not constitute a waiver by Buyer of any other rights Buyer may have at law or in equity. 12. Studies, Reports and Investigations. Seller agrees to make available to Buyer within two (2) business days following the Effective Date, any and all correspondence with governmental agencies, information, studies, reports, investigations, contracts, licenses, leases, rental agreements and other documents concerning or relating to the Property which are in Seller's possession or which are reasonably available to Seller (collectively, "Property Documents "), including without limitation any CC &Rs affecting the Property and any analyses, surveys, environmental site assessments, studies, reports and investigations concerning the Property's physical, environmental or geological condition, habitability, or the presence or absence of Hazardous Materials (defined in Section 17.1) in, on, under or about the Property and the compliance by the Property with Environmental Laws (as defined in Section 17.1). 12.1 Phase 2 Report; Remediation Cost Estimate. Prior to the Close of Escrow. Buyer shall cause its consultant to complete a Phase 2 environmental assessment of the Property and a cost estimates for the remediation of Hazardous Materials on the Property ( "Remediation Cost Estimate "). The Remediation Cost Estimate will be based upon applicable regulations and the assumption that the Property will be developed as a mixed use project that will include either commercial or residential uses on the ground level and above. If the Remediation Cost Estimate is equal to or less than the sum of Five Hundred Thousand Dollars ($500,000), then the amount of the Remediation Cost Estimate shall be credited against the Purchase Price. If the Remediation Cost Estimate exceeds the sum of Five Hundred Thousand Dollars ($500,000), then either Seller or Buyer may terminate this Agreement by written notice delivered to the other Parties in accordance with Section 26.3. In the event of such termination, all funds and documents deposited into escrow by or on behalf of Buyer shall be returned to Buyer, and all rights and obligations hereunder shall terminate except as expressly provided herein. Notwithstanding the foregoing, Seller shall have the right to prevent termination of this Agreement by delivery of written notice to Buyer and Agency in accordance with Section 26.3 if Seller agrees that the full amount of the Remediation Cost Estimate will be applied as a credit a! ainst the Purchase Price. If this A reement is not terminated and the sale of the Pro s ert is completed pursuant to this Agreement, the Agency will pay any remediation costs that exceed the Remediation Cost Estimate. 13. Buyer's Additional Conditions to Closing. Buyer's obligation to purchase the Property is conditioned upon Buyer's review and approval of the condition of the Property and the Property Documents (defined in Section 12) pursuant to this Section. (a) Feasibility Studies. During the period commencing on the Effective Date and ending on the forty -fifth (45th) day thereafter or such later date as mutually agreed upon by the Parties ( "Due Diligence Period ") Buyer may, at Buyer's expense, undertake an inspection and review of the Property and analysis of the Property Documents, including without limitation (i) review and analysis of the physical condition of the Property, including but not limited to, inspection and examination of soils, environmental factors, Hazardous Materials, and archeological information relating to the Property; (ii) a review and investigation of the effect of any zoning, maps, 1666030.11605181.1 6 permits, reports, engineering data, regulations, ordinances, and laws affecting the Property, and (iii) an evaluation of the Property to determine its feasibility for Buyer's intended use. Buyer may consult with or retain civil engineers, contractors, soils and geologic engineers, architects and other specialists in its investigation, and may consult with or retain other consultants to determine if the Property is suitable for Buyer's intended use. 1# II-aye-Cs env.ir n e iatal consultants t require additional time to determine the the right, exercisable by delivering written notice to Seller prior to the expiration of the Due Diligence Period, to extend thcThe Due Diligence Period and the date for Close of Escrow shall be extended for-t -to twenty (20) additional days to complete the testing.in order to permit Buycr s civironmcnt4al consultants to complete a Phase 2 environmental assessment of the Property and a cost estimate for remediation of Hazardous Materials on the Property. Notwithstanding anything to the contrary set forth herein, the Parties agree that Close of Escrow shall not take place prior to the completion of both a Phase 2 environmental analysis of the Property and a cost estimate for remediation of Hazardous Materials on the Property pursuant to Section 12.1. Notwithstanding the preceding sentence if the cost estimate for the remediation is not complete within the Due Diligence Period and extension set forth herein, the parties may, by mutual agreement, extend the due diligence period or either party may terminate this agreement. (b) (b) Other matters. During the Due Diligence Period, Buyer may inspect, examine, survey and review any other matters concerning the Property, including without limitation, any and all studies or reports or Property Documents provided by Seller, all contracts, leases, licenses, rental agreements and other obligations relating to the Property, and the Property's conformity with all applicable laws and regulations. (c) Rent Roll; Tenant Leases. Within five (5) business days following the Effective Date, Seller shall deliver to Buyer a current rent roll, certified by Seller, listing for each tenant of any part of the Property, all of the following: tenant name, premises occupied, monthly rent, amount of deposit, amount of prepaid rent, and term of lease. Within five (5) business days following the Effective Date, Seller shall deliver to Buyer certified copies of all tenant leases, including any amendments and modifications. On or before the Close of Escrow, Seller shall assign all of Seller's rights and remedies under the tenant leases, including the right to any security deposits and prepaid rent, to Buyer pursuant to an assignment of leases and security deposits in form and substance satisfactory to Buyer (the "Assignment of Leases "). (d) Estoppel Certificates. No later than ten (10) business days after the Effective Date, Seller shall deliver to Buyer an estoppel certificate in form satisfactory to Buyer executed by each Tenant of the Property. Seller shall deliver updated estoppel 1666030.11605181.1 7 (h) Seller has disclosed to Buyer all information, records, and studies in Seller's possession or reasonably available to Seller relating to the Property concerning Hazardous Materials and their use, storage, spillage or disposal on the Property; (i) Seller has not received any notice from any governmental authority of any threatened or pending environmental violation that has not previously been corrected, and no condition on the Property violates any Environmental Law; (j) there are no land use controls or other restrictions (other than zoning limitations) that would prohibit certain uses on the Property; and (k) Seller has disclosed all material facts concerning the environmental condition of the Property. 19. Environmental Indemnity. ToSub_ect to Section 12.1 to the fullest extent allowed by law, Seller agrees to unconditionally and fully indemnify, protect, defend (with counsel satisfactory to Buyer), and hold Buyer and the Agency, and their respective elected and appointed officers, officials, employees, agents, consultants and contractors harmless from and against any and all claims (including without limitation third party claims for personal injury, real or personal property damage, or damages to natural resources), actions, administrative proceedings (including without limitation both formal and informal proceedings), judgments, damages, punitive damages, penalties, fines, costs (including without limitation any and all costs relating to investigation, assessment, analysis or clean up of the Property), liabilities (including without limitation sums paid in settlements of claims), interest, or losses, including reasonable attorneys' and paralegals' fees and expenses (including without limitation any such fees and expenses incurred in enforcing this Agreement or collecting any sums due hereunder), together with all other costs and expenses of any kind or nature (collectively, the "Costs ") that arise directly or indirectly from or in connection with the presence, suspected presence, release, or suspected release, of any Hazardous Materials in, on or under the Property or in or into the air, soil, soil gas, groundwater, or surface water at, on, about, around, above, under or within the Property, or any portion thereof, except those Costs that arise solely as a result of actions by Buyer. The indemnification provided pursuant to this Section shall specifically apply to and include claims or actions brought by or on behalf of employees of Seller or any of its predecessors in interest and Seller hereby expressly waives any immunity to which Seller may otherwise be entitled under any industrial or worker's compensation laws. In the event the Buyer suffers or incurs any Costs, Seller shall pay to Buyer the total of all such Costs suffered or incurred by the Buyer upon demand therefore by Buyer. The indemnification provided pursuant to this Section shall include, without limitation, all loss or damage sustained by the Buyer due to any Hazardous Materials: (a) that are present or suspected by a governmental agency having jurisdiction to be present in the Property or in the air, soil, soil gas, groundwater, or surface water at, on, about, above, under, or within the Property (or any portion thereof) or to have emanated from the Property, or (b) that migrate, flow, percolate, diffuse, or in any way move onto, into, or under the air, soil, soil gas, groundwater, or surface water at, on, about, around, above, under, or within the Property (or any portion thereof) after the date of this Agreement as a result of Seller's or its predecessors' activities on the Property. The provisions of this Section shall survive the termination of this Agreement and the Close of Escrow. 1666030.11605181.1 12