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HomeMy WebLinkAboutReso 02-2015 RESOLUTION NO. 02-2015 CITY COUNCIL, CITY OF SOUTH SAN FRANCISCO, STATE OF CALIFORNIA RESOLUTION AUTHORIZING THE CITY MANAGER TO ENTER INTO A REVENUE SHARING AGREEMENT FOR COMMERCIAL SPACE AT 636 EL CAMINO REAL WITH THE SUCCESSOR AGENCY TO THE REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO,COUNTY OF SAN MATEO, SOUTH SAN FRANCISCO UNIFIED SCHOOL DISTRICT, SAN MATEO COUNTY COMMUNITY COLLEGE DISTRICT, SAN MATEO COUNTY FLOOD CONTROL DISTRICT COLMA CREEK FLOOD CONTROL ZONE,WILLOW GARDENS PARKS AND PARKWAYS MAINTENANCE DISTRICT, SAN MATEO COUNTY RESOURCE CONSERVATION DISTRICT, BAY AREA AIR QUALITY MANAGEMENT DISTRICT AND SAN MATEO COUNTY HARBOR DISTRICT WHEREAS, In March 2011 the former Redevelopment Agency of the City of South San Francisco ("RDA"), ground-leased certain real property to the Mid-Peninsula Housing Coalition ("MPHC")and provided a loan,using its housing and non-housing funds,to MPHC for the purpose of development of a mixed-use affordable housing project to be located at 636 El Camino Real in the City of South San Francisco. Substantially concurrently therewith, pursuant to a Master Lease Agreement the RDA leased back from MPHC a portion of the property to be developed as commercial retail space and associated parking, for a term of 75 years. WHEREAS,Pursuant to the Master Lease Agreement,MPHC agreed to pay a one-time sum to the RDA to be used for commercial tenant improvements, and the RDA agreed to make tenant improvements for its subtenants. WHEREAS,The California Legislature enacted ABx1-26,effective as of June 30,2011, as interpreted and modified on December 29, 2011 by the California Supreme Court in California Redevelopment Association v.Matosantos. Pursuant thereto,the RDA was dissolved effective as of February 1,2012. Successor agencies to redevelopment agencies were charged with administering redevelopment activities and winding down redevelopment for the benefit of holders of enforceable obligations and the taxing entities that would receive certain real property tax increment formerly paid to redevelopment agencies. The actions of successor agencies were to be overseen by local "oversight boards"established by ABx 1-26,with additional review and approval authority residing in the California Department of Finance ("DOF"). WHEREAS, On January 25,2012,pursuant to Resolution No. 8-2012,the City Council of the City elected to serve as Successor Agency to the RDA and to retain the housing assets and functions of the RDA in its capacity as housing successor. WHEREAS,On July 27,2012,the California Legislature enacted AB 1484,which modified ABx1-26 by, among other things, clarifying that a redevelopment successor agency is a separate public entity from the public agency that provides for its governance. ABx1-26 and AB 1484 are referred to collectively herein as the "Redevelopment Dissolution Law." WHEREAS, Accordingly, on July 25, 2012, pursuant to Resolution No. 06-2012, the Successor Agency affirmed that it is a separate public entity from the City and provided for its governance. WHEREAS, On August 31, 2012, pursuant to the Redevelopment Dissolution Law, DOF determined that the land leased to MPHC and the loan made to MPHC by the RDA were housing assets and authorized their transfer to the City as housing successor to the RDA. WHEREAS, In September 2012 MPHC completed construction of a 109-unit affordable housing development,with approximately 5,700 square feet of unimproved commercial space and associated parking, at 636 El Camino Real (the "Development"). WHEREAS,Because the Development contains approximately 5,160 square feet of retail space, it is subject to Health and Safety Code Section 34176(f), enacted as part of the Redevelopment Dissolution Law,which provides as follows: "If a development includes both low- and moderate-income housing that meets the definition of a housing asset under subdivision(e)and other types of property use,including,but not limited to, commercial use, governmental use, open space,and parks,the oversight board shall consider the overall value to the community as well as the benefit to taxing entities of keeping the entire development intact or dividing the title and control over the property between the housing successor and the successor agency or other public or private agencies. The disposition of those assets may be accomplished by a revenue-sharing arrangement as approved by the oversight board on behalf of the affected taxing entities." WHEREAS,On April 16,2013,the Oversight Board for the Successor Agency reviewed the Development at a public meeting. Pursuant to OB Resolution No. 12-2013, the Oversight Board approved the assignment of the Commercial Portion of the Master Lease Agreement from the Successor Agency to the City, which administers the housing portion of the Master Lease Agreement. The Oversight Board found that the City held title to the entire property as housing successor to the RDA, and that such assignment would facilitate the construction of tenant improvements for the three commercial tenant spaces and the collection of rents therefor and benefit the taxing entities. The Oversight Board also directed staff to present terms for a revenue-sharing arrangement with the taxing entities, which terms have been presented to and approved by the Oversight Board. WHEREAS, Two of the three spaces in the Commercial Portion of the Development have been improved by the City as housing successor, using funds from MPHC pursuant to the Master Lease Agreement and have been subleased to subtenants. Funds for the final tenant improvements have been approved by the Oversight Board and DOF as enforceable obligations on the Recognized Obligations Payment Schedule("ROPS")14-15B and future ROPS until those tenant improvements have been completed. WHEREAS, The Parties desire to enter into this Agreement in order to comply with the Redevelopment Dissolution Law and, specifically, Health and Safety Code Section 34176(f). NOW, THEREFORE, the City Council of the City of South San Francisco does hereby resolve as follows: 1. The Recitals set forth above are true and correct,and are incorporated herein by reference. 2. The Agreement, substantially in the form attached hereto, is hereby approved, and the City Manager or his designee is hereby authorized to execute it on behalf of the City; to make revisions to the Agreement,with review and approval by the City Attorney,which do not materially or substantially increase the Agency's obligations thereunder; to sign all documents; to make all approvals and take all actions necessary or appropriate to carry out and implement the intent of this Resolution. * * * * * I hereby certify that the foregoing Resolution was regularly introduced and adopted by the City Council of the City of South San Francisco at a regular meeting held on the 14th day of January, 2015 by the following vote: AYES: Councilmembers Karyl Matsumoto, Pradeep Gupta, and Liza Normandy Vice Mayor Mark N. Addiego and Mayor Richard A. Garbarino NOES: None ABSTAIN: None ABSENT: None A TEST.. Krista M. , , City '