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HomeMy WebLinkAboutMinutes 1998-09-02 Mayor Eugene R. Mullin Council: James L. Datzman Joseph A. Fernekes ~Karyl Matsumoto John R. Penna MINUTES City Council Municipal Services Building Community Room September 2, 1998 SPECIAL MEETING CITY COUNCIL OF THE CITY OF SOUTH SAN FRANCISCO SEPTEMBER 2, 1998 NOTICE IS HEREBY GIVEN, pursuant to Section 54956 of the Government Code of the State of California, that the City Council of the City of South San Francisco will hold a Special Meeting on Wednesday, the 2nd day of September 1998, at 5:30 p.m. in the Municipal Services Building, Community Room, 33 Arroyo Drive, South San Francisco, California. Purpose of the meeting is a study session for discussion of: Downtown development issues. City Clerk City of South San Francisco Dated: August 27, 1998 CALL TO ORDER: ROLL CALL: AGENDA (Cassette No. 1) Downtown development issues ACTION TAKEN 6:37 p.m. Mayor Mullin presiding. Council Present: Council Absent: Datzman, Fernekes, Matsumoto and Muilin. Penna. Mayor Mullin stated Councilman Penna has an unavoidable conflict of interest that he related to himself and the City Clerk. Director of Economic & Community Development Van Duyn related: there are three separate staff reports in the packet; one is on the corridor of land along Grand and Baden between Airport and the railroad tracks; the second is a review of a draft work program to coordinate staff's efforts for the general plan update; the third is the proposed part- 9/2/98 Page 1 AGENDA Downtown development issues - Continued. 9/2/98 Page 2 ACTION TAKEN nership between the Redevelopment Agency and Terranomics/Metrovation; staff feels the primary thing is the development option along Airport; the review of the work plan and agreement with Terranomics is the least important, but if staff does not get to them it will not be the end of the world; the agreement proposal between the Agency and Terranomics is scheduled for the next meeting of the Agency. Mayor Mullin stated the items will be taken in or- der. Coordinator of Economic & Community Develop- ment Beyer related: this item is a follow-up of a May study session where Council discussed the extension of the Caltrain and the status of the Joint Powers Board study on a potential land use option; Council asked staff to come back with a more de- tailed analysis on the parcels on Airport between Baden and Grand Avenues; the alternatives were an all transportation use or a retail/hotel/office use and residential, and the option to leave it as is with the property owners developing their own properties; one of the assumptions is that the Caltrain Station platform would be extended; essen- tially Caltrans property will be used for access to the area and for pedestrian access to Grand Avenue; the transportation interest was determined several years ago, and the concept for connecting trains, buses, bike and pedestrian use in the downtown area; late last year staff asked the general plan consultant to take a look at the area and relocate the Caltrain Station to provide accessibility to pedestrians from the downtown area, shuttle drop-offs, vehicle and pedestrian accessibility from businesses east of the station and bus/taxi interface from bus routes along Airport Boulevard; the consultant came up with two designs, but there was one that was favored to pro- vide egress to the site and provide a loop for the buses; there is a certain amount of square footage that could be developed for some other uses that are not articulated in the staff report; the other alterna- tive suggested a different loop, however, this would not be useful for southbound buses because they could not access the site and would limit uses for transportation on the site; the alternative would not generate any revenue but would have a substantial implementation cost; the Agency would have to acquire all of the property on the site that would range from $2.5 million to 3 million and another AGENDA Downtown development issues - Continued. 9/2/98 Page 3 ACTION TAKEN $200,000 in potential moving costs for the existing businesses on the site, and an additional $300,000 is needed for site clearance and improvements; the next alternative is retail use and four alternative site plans were studied for this area - a major regional retailer, two different design alternatives with a smaller major retailer and a pad, and a major retail- er and a pad, three smaller retailers with a pad for fast food; each retail use site plan is significantly impacted by the pedestrian access to the train station to Grand Avenue; staff estimated the potential sales tax for the alternatives; next is the hotel use, and there are two scenarios, one for 150 rooms and 200 rooms and he spoke of projected T.O.T. revenue; next alternative is an office/residential use that Council asked staff to look at, we didn't speak to that because there are noise problems that need significant mitigation if a residential use was put on the site, but one was done for office use of 22,400 sq. ft. with residential use above the office use; the primary constraint is the amount of parking to serve the land use, and the other option is that the Agency not proceed on the parcels, but the individual prop- erty and the extension of the train depot facility and then, the pedestrian walkway for the site; staff showed revenue for each of the options, and in conclusion was not enamored by any of the options to provide a designation and a design impact with the property being on the other side of Airport Blvd., and the other constraint is that it is very difficult to come up with a design and use perspec- tive that enhances or adds to the downtown; there are two hotel concepts, the first is 150 rooms and the second 200 rooms; a hotel use, if designed appropriately can make a design statement on the site; the owner, Mr. Desai, has presented a plan for 150 room hotel incorporating all of the parcels under review and would provide a restaurant with some meeting facilities that would generate between $199,290 and $229,950 annually in T.O.T. revenues over the first three years; Mr. Desai has also pre- sented revenue projects for a 200 room hotel; staff does not know if a hotel on this site would be suc- cessful or not, for they are not hotel owners. Councilman Fernekes related: he still has existing concerns; his preference is in a inter-modal station, as he said the last time, and he believes that would best suit that area and assist the people that need to go to work and make it an entrance to Grand Ave- nue; he would be opposed to a large hotel, but AGENDA Downtown development issues - Continued. 9/2/98 Page 4 ACTION TAKEN wants a large modal station. Vice Mayor Datzman related: he was having trou- ble conceptually; Council initially talked about the idea of Caltrain and the whole transportation thing, and now staff is saying we have to come up with $3 million, or are there other issues. Director of Economic & Community Development Van Duyn stated, let's not confuse the ultimate goal for the extension of the platform with this devel- opment site and the Caltrans property that runs along Grand Avenue, for it has always been the City's intent to purchase the property. It is still staff's intent to request the Redevelopment Agency to acquire the Caltrans property to control the en- trance with some sort of improvement that is mod- est. If the City does get the platform extension, for we are going full board, and it appears to be suc- cessful with the Joint Powers Board and it will give the City a public place to take people all the way to the train station. Also in the train station is the east side access which was in the charrette, for we pre- pared some sketches of the site to improve the rela- tionship to the interface to downtown, the Borba property and the Caltrans property could provide the transportation station we would need. So, that is an option, and does not preclude any of the project. Discussion followed: Vice Mayor Datzman asked if the option allows for Caltrans to be altered; nothing stands in the way of that; Vice Mayor Datzman stated the diagram, the one for transit, is saying clearly the same kind of pedestrian access is there and there is a turn around for buses and cars, so why wouldn't we want to do this; because of the cost, it is expensive, you have to purchase the Borba property and the Caltrans property for $2.5 to $3 million and you are looking at the site clearance, and further expenses for site improvement; to get the tracks moved and get the access on the east side, that is at least a million and a half dollars or it could be more than that; Councilman Fernekes, stated Council spoke of having the inter-modal station with transit related businesses, which was also what Mr. Borba talked about; Director of Economic & Com- munity Development Van Duyn stated staff is say- ing, in their estimate, retail can be accommodated on the site with transit activity, but the consultants are saying, if we decide to do retail they can not assure that, for they would need parking to attract AGENDA Downtown development issues - Continued. 9/2/98 Page 5 ACTION TAKEN other than train customers and they would have to be given assurances that they could attract custom- ers; Vice Mayor Datzman did not see anything in number 5 that makes him jump up and down to do something based on the costs; Mayor Mullin dis- counted the $3 million for a bus to turn around; Mayor Datzman stated the staff report in the first paragraph says the only land use that meets this objective is the hotel use and looks like staff is saying the hotel use is the only one that makes sense; Director of Economic & Community Devel- opment Van Duyn stated in a perfect market that gives us a high profile and yes a full service hotel justifies the improvements and there are some pro- posals with a cocktail lounge and some activity adjacent to the trains; so, the transportation is a good marriage and they feed off of each other; if it can be proved that it does not need an excessive amount of parking, for staff is not looking for space that wouldn't be used; staff has been told that the retail development cannot stand on its own, it needs parking, and at this ratio it is going to attract park- ing; if a retail use comes in and says, we don't need parking, that is one thing, because the City does not get revenue from parking; Vice Mayor Datzman would like to know how people feel on the retail configuration, and there are several retailers here, but nothing jumps out to say this makes sense and he recognizes that is not what it is about tonight; Director of Economic & Community Development Van Duyn does not feel confident that the market is in good shape for a 4-star hotel, for it is a busy corridor with a busy access and exit; Vice Mayor Datzman stated parking was a big issue, and asked, does that mean that with a smaller hotel parking is not an issue; Director of Economic & Community Development Van Duyn stated a hotel, restaurant and cocktail lounge has the biggest opportunity for revenue; staff needs to make sure the pedestrian access works also; the freeway is noisy and Title 20 development is obligated to meet the noise levels; all elements were talked about in the charrette as being an entryway for the City and there could be some retail on the site, however, they failed to give the parameters to the consultant; Councilwoman Matsumoto considers this the greater part of the downtown, yet the consultant's remarks reveal that hotels represent transit; she is not revenue driven and feels the Council should give back to the citi- zens; she questioned if it would help to have busi- nesses be open to 8:00 or 9:00 p.m. to help the AGENDA Downtown development issue - Continued. 9/2/98 Page 6 ACTION TAKEN downtown; City Manager Wilson stated East of 101 is not sufficient to generate evening traffic, whereas a hotel would generate night traffic; he related the economics of it - when staff was approached by Mr. Desai on the hotel he planned, staff evaluated the City's future plans and solicited him for a larger site; so, if that occurs there needs to be City partici- pation for it to be feasible; so, when you are taking a look at what generates dollars, staff looks for pay back, maybe not on a loan, but justify monies going out; this analysis - when the Borba's said there were other options, there is nothing to say there cannot be retail and a hotel on the site; in looking at it staff said it doesn't meet some of the objectives; if you take a look at the factors and the perfect world, the hotel could meet most of the criteria, but certainly the other could too; Councilman Fernekes stated if the Council was looking for a major theme - it is not a hotel, for he saw something different in the charrette, and Mr. Borba wants retail related uses; Director of Economic & Community Development Van Duyn stated a transit modal could be put in, but the total cost for the station and interface is signifi- cant -- like $5 million; Vice Mayor Datzman stated he is pro hotel, but it looks like a shoehorn when you talk about that property, that is his concern, and thinks all other alternatives make more sense; Mayor Mullin thinks it is Hobson's Choice, in reading through the staff report and the alternatives, where none occur to him to be his ultimate for the site; if the City does an inter-modal the cost is prohibitive on the site, the Caltrain is in jeopardy and we are fortunate that we got a grant to get better numbers to do the east site - if we don't do anything but the Caltrain site; he is intrigued with Karyl's comments about Terranomics and staff having them sort of follow through with an in-depth analysis with the downtown, but he is chilled with what he read about them; he is not sure they will be able to help us on a site that is at best difficult to work with the hotel option, which seems to make the most sense which will bring in traffic for Buon Gusto and the other restaurants; he feels it is a project that will be a gateway type of project, it is not the charrette; he is concerned about the market and eastern europe, the over emphasis on hotels and have some fail, and that exists with the emphasis on the new hotel; there is no clear cut answer, so he is inclined to hold off a little and hear what Terranomics has to say, and see if we can do with an analysis to give us somewhat clearer direction; maybe have a transportation inter- ~NDA ACTION TAKEN ._Downtown development issues - Continued. 9/2/98 Page 7 modal interface maybe across the street to do it in close proximity and be able to free up more of the land. Mr. Phil Copeland stated he is Mr. Desai's architect and was born and raised in S.S.F. He recognizes the Council's problem with the site and the argu- ments made tonight. He stated the most critical for him is the difficult site, and he feels it is important to establish Council's goals. He stated the solution is a minimal turn around, for in the past more peo- ple used the train than now and does not see the activity to support what the Council is talking about. He stated he has taken part in many charrettes that are to create imagination, to think unfettered about economics and they rarely come out with a solution. He personally believes that the hotel will solve the problems better than anything else, and there is an opportunity to do a quality hotel. He stated fran- chises are at a premium and everyone is after them, like the Sheraton, and people have to move fast. He stated Daly City is trying to get a Sheraton and these are the franchises that made these viable as a hotel. To facilitate a positive impact on the City this should be as soon as possible for the potential of a hotel. He requested, if any traffic studies on vehicle or pedestrian traffic are made, that would suggest that the greatest use is indeed for model transporta- tion. Mr. Bill Borba stated he is a property owner on Airport Blvd. and Grand Avenue. He stated he is not going to espouse the virtues of one use over the other, but will explain his standpoint. He related: there were discussions with City staff; his family was approached by other people for their property; his family is interested in and very much like to see something happen; in discussions with staff the concept of reconfiguring the property and develop- ing into retail use, and the question was posed if we as a family wanted to be a part of the development; we would, and we still like to be a part of this de- velopment; the issues are many for the Council to determine; Mike Wilson mentioned the return in- volved if it is a dollars and sense, then the hotel is best use for the City; his original interpretation from the charrette, and to the merchants, was that many of the majority intent was bringing the downtown to the east side and opening up and bringing in the workforce; he thinks that is the Council's greatest resource over dollars and sense; that started remod- AGENDA ..~owntown development issues - Continued. Mayor Mullin Left the Meeting at 6:44 p.m. 9/2/98 Page 8 ACTION TAKEN eling the interior and spent a considerable amount of funds; the family shares five businesses plus his son's interest; they have not moved into the build- ing, so they are ham strung and put it on hold, but at some point we need directions because other wise we will go ahead and fix the property for their current use which is important for his son's busi- ness; the family has been there 42 years, which is a long time, so, if anyone wants to know about flyover noise - come see him; the Borba's as a family feel something major has to be done in the downtown for the survival, and for the merchants; they want to be around for generations to come, want to assist and be kept informed of what is going 0n. Discussion followed: Mayor Mullin stated he had to leave for a Roundtable meeting, but would give his comments: he has no problem with Terranomics and their work plan; he does want to make com- ments and will be a harder sell during the second time around; the larger package, that Council sug- gested in the preferred case was something like a Trader Joe's or a specialty area; City Manager Wilson stated those stores draw the affluent airline crowd that are attracted to the food and try to attract workers to this area that do not participate on Grand Avenue, so it could be twenty different variety stores, or it could be a commuter park. Chief Planner Harnish summarized the work plan and its three basic elements: target new studies to augment the efforts by enhancing the work program and focusing a little more effort; targeting the efforts of Terranomics and the retail attraction components; looking at the sign ordinance and revising; looking at the new design on the main street program and looking for a code enforcement program, and these would be originated under an umbrella; staff will work with the business community and the Cham- ber, which will be the nucleus of the long term success of the program; one of the first efforts is to refine the work program and come back to Council for direction; the budget is essentially in place and will come back to you as the programs are devel- oped; a single staff person will be identified as a coordinator. Discussion followed: there are three general areas, objectives and the cost; Mayor Pro Tern Datzman is concerned about the impact on existing property AGENDA ACTION TAKEN ~'~'-~ __Downtown development issues - Continued. 9/2/98 Page 9 owners, the City and different uses on the downtown from a hotel and still has many questions; City Manager Wilson stated he has worked with Terranomics and feels they are exciting and contin- ues to recommend them for the study of the down- town; Councilwoman Matsumoto still thinks bring- ing in Terranomics would be an overlap, and ques- tioned if the Council was putting the cart before the horse; Chief Planner Harnish stated Terranomics is included in here so when we talk about the retail development the element will be embraced and included in the umbrella; Councilwoman Matsumoto stated we are talking about $215,000 and that in- cludes the market analysis program; yes; it is possi- ble to see what portion is already approved in the present budget; Terranomics is budgeted, but staff needs Council's approval; City Manager Wilson stated a number of these items talk about strategies and plans; staff has been working code enforcement and they want to talk to Council about an ordinance that talks about increased eftbrts and manhours; Vice Mayor Datzman was talking about a downtown unified approach where staff is ready to look at clear cut issues, if we are going to take it anywhere, like the sign ordinance and code enforcement which are going to result in mixed reactions - but, are they needed - yes; who is the lead person and who gets the credit if it is successful - the Director of Eco- nomic & Community Development; Mayor Pro Tem Datzman was concerned about traffic flow on Grand Ave., including parking; Mr. Mike Pacelli, Cham- ber of Commerce, supports this and will develop participation with the business community; Coordi- nator of Economic & Community Development Beyer stated they are going to jump start the retail development downtown; are trying to find a niche to provide services and a retail mix; should do a study, determine a niche and form a partnership with Terranomics; what the City buys designated build- ings; bring in retailers and develop, City spends time and money, Terranomics spends time and the developer spends money; it sounds like a lot of eminent domain to Councilwoman Matsumoto; Director of Economic & Community Development Van Duyn stated yes, that could happen; the Mayor's concern was that the City did not see a return in the past on its money; only spend $20,000 if there is a project; etc. M/S Fernekes/Matsumoto - To adjourn the meeting. AGENDA ACTION TAKEN DJOURNMENT: Carried by unanimous voice vote. Time of adjournment was 7:15 p.m. RESPECTFULLY SUBMITTED, Barbara A. Battaya, City Clerk City of South San Francisco APPROVED. ugen~. Mullin, Mayor City ot~South San Francisco The entries of this Council meeting show the action taken by the City Council to dispose of an item. Oral communica- tions, arguments and comments are recorded on tape. The tape and documents related to the items are on file in the Office of the City Clerk and are available for inspection, review and copying. 9/2/98 Page 10