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HomeMy WebLinkAboutRDA Minutes 2009-02-11~Tx SANF 1VIINUTE o`` o ~;' = ~ ~tiN REDEVELOPMENT AGENCY ~._W.;~ " ~ CITY OF SOUTH SAN FRANCISCO _..: ~'~LIFOR~~~' REGULAR MEETING MUNICIl'AL SERVICES BUILDING COMMUNITY ROOM WEDNESDAY FEBRUARY 11, 2009 CALLED TO ORDER: 6:30 p.m. ROLL CALL: Present: Boardmembers Garbarino, Gonzalez and Mullin, Vice Chairman Addiego and Chairwoman Matsumoto. Absent: None. AGENDA REVIEW None. PUBLIC COMMENTS None. CONSENT CALENDAR Motion to approve the minutes of January 14, 2009 and January 28, 2009. 2. Motion to approve the expense claims of February 11, 2009 in the amount of $622,706.65. 3. Resolution No. 2-2009 authorizing the execution of a Subordination Agreement with Willow Gardens Housing Associates (an affiliate of Mid-Peninsula Housing Coalition) and Union Bank for the Willow Gardens Revitalization Project and making a finding that an alternative method of refinancing is not reasonably available without subordination. Motion-Boardmember Gonzalez/Second-Boardmember Garbarino: to approve Consent Calendar Items Nos. 1 & 2. Unanimously approved by voice vote. Item 3: Boardmember Mullin questioned the meaning of subordination as pertinent to the proposed agreement with Willow Gardens Housing Associates. Manager of Housing and Redevelopment Fragoso explained that Mid Peninsula Housing had secured the property with 50% of the funds coming from a loan from the Redevelopment Agency and 50% coming from conventional financing methods. Subordination meant the City would give up its place on the lien and the bank would take its place. This was fairly standard in this type of circumstance. Boardmember Mullin stated the subordination would increase the Agency's exposure somewhat, but only if a default situation occurred. Chairwoman Matsumoto questioned the relationship between Willow Gardens Housing Associates and Mid- Peninsula. Manager Fragoso responded that Mid-Peninsula set up a holding company for every property it operated to prevent comingling and to keep its various projects separate. Willow Gardens was the holding company on this project. Boardmember Garbarino questioned the funding mechanism in the event of default. Counsel Mattas advised that in the event of default, the Agency would have the opportunity to cure it by paying-off the senior debt. Manager Fragoso advised funds to cure the default would come from the Low-Mod Housing Fund and that it was probably unlikely that tax credits could be applied quickly enough in a default situation. Vice Chairman Addiego requested confirmation that the Agency was already invested in the properties up to 50% of the original acquisition price and further questioned what that amounted to. Manager Fragoso stated the City was invested in the property up to 50% of the original acquisition price. She opined the value of the properties presently exceeded the 1998 acquisition cost, although she did not know the current value. She further noted the refinance Mid-Peninsula was pursuing did not pertain to the entire property value, but only to a $2 million dollar amount. Executive Director Nagel added that $2 million -and not the entire acquisition cost of the property -would be the Agency's payout if it had to save the loan transaction. Vice Chairman Addiego questioned whether there would be advantages to the Agency's stepping up to pay the amount now. Manager Fragoso advised she did not foresee an advantage given that the amount would have to be funded by cash out of pocket. Motion -Boardmember Garbarino/Second -Boardmember Gonzalez: to approve Resolution No. 2-2009. Unanimously approved by voice vote. REGULAR REDEVELOPMENT AGENCY MEETING FEBRUARY 1 I, 2009 MINUTES PAGE 2 PUBLIC HEARING 4. Hyatt Place Hotel Vijay Patel/applicant SRI Krishna Enterprises/owner 550 Gateway Blvd P07-0073: PP07-0001, SIGN07-0047, VAR07-0004, TDM08-0003, DR07-0046 & MND07-0003 Precise Plan, Type "C" Sign Permit, Design Review, Transportation Demand Management Plan & Variance applications fora 166 room, eight-story Hyatt Place Hotel, at 550 Gateway Boulevard, in the Gateway Specific Plan District in accordance with SSFMC chapters 20.57, 20.85, 20.86 & 20.120. Continued from regular meetings of November 12, 2008, December 10, 2008 and January 14, 2009. Motion to continue to the regular meeting of March 11, 2009. Public Hearing opened: 6:47 p.m. Public Hearing Closed: 6:47 p.m. Boardmember Gonzalez questioned the recommendation to continue the public hearing. Senior Planner Beaudin responded the applicant was seeking more time to comply with requests the Agency had made for additional information and a model of the proposed project. He further noted the Public Hearing would need to be continued to a date certain to avoid a time period issue in light of the zoning code. Boardmember Garbarino opined preparation of a model was likely not holding-up the project. Senior Planner Beaudin advised he was in fairly regular contact with the applicant. He noted the applicant was taking time to look into the incorporation of green elements with his design team. He was also exploring the issue of rebates on solar improvements. Chairwoman Matsumoto and Vice Chairman Addiego stated that in these economic times, they did not want to force the applicant to reapply by denying the continuance. Chairwoman Matsumoto questioned whether the Agency had requested a model for projects of similar size. Senior Planner Beaudin responded that of late, project applicants had been preparing models. Vice Chairman Addiego stated he didn't recall a consensus amongst the Agency members with respect to the request for a model. REGULAR REDEVELOPMENT AGENCY MEETING FEBRUARY I I, 2009 MINUTES PAGE 3 Counsel Mattas advised the consensus of the majority was to request the applicant to return with answers/resolutions to several requests that had been made by various Agency members, including sustainability features, a local labor issue and preparation of a model. If the Agency was desirous of having the applicant return without a model, staff could so inform the applicant. Boardmember Garbarino stated that if the applicant wanted his approval, he had better show-up with a model. Boardmember Mullin stated that in deference to Boardmember Garbarino, he supported the request that the applicant provide a model. Chairwoman Matsumoto requested that the applicant show-up at the next meeting to provide an update on his progress. If for some reason a model was not completed, he should be prepared to explain the shortcoming. Motion -Boardmember Garbarino/Second -Boardmember Gonzalez: to continue the Public Hearing on the matter to the Regular Meeting of March 11, 2009. Unanimously approved by voice vote. ADMINISTRATIVE BUSINESS Annual Redevelopment Reporting Requirements. Finance Director Steele advised that on an annual basis the Agency was required to submit to the State Controller's Office and review with the governing body reports pertaining to property, housing activities, blight progress, financial transactions and audited financial statements. Director Steele explained the reports were submitted to the Agency and/or were accessible as directed in the staff report. He then presented several highlights of the reports as follows: A table identifying the net assets of the Redevelopment Agency as of June 30, 2008 was presented reflecting page five (5) of the financial statements. He advised that current assets were down against 2007 because the agency used cash and the cost of several properties went up. In addition, current liabilities went up due to an unfavorable ruling from a judge on a property tax issue. A table identifying outstanding Redevelopment Agency debt as of June 30, 2008 was presented reflecting page 8 of the financial statements. Director Steele advised the largest piece of the nearly $2 million debt reduction was attributable to the 2006 revenue bonds and that there were smaller decreases pertaining to the 1999 Certificates of Participation relating to the Conference Center and the 2000 HUD Section 108 Loan. Director Steele also called attention to the RDA Statement of Revenues and Expenditures reflected on page 16 of the financial statements. REGULAR REDEVELOPMENT AGENCY MEETING FEBRUARY 11, 2009 MINUTES PAGE 4 Chairwoman Matsumoto noted that the report showed the City owed $17 million for hook ramps and flyovers. Director Steele advised this related to the relationship between the Impact Fee Fund and the RDA. Director of Economic and Community Development Van Duyn advised that as an example, the Alexandria Real Estate project had a substantial impact fee obligation likely in excess of $2 million. This $2 million would be put towards repaying the loan to the RDA and save a substantial amount of interest. Chairwoman Matsumoto further questioned how the Agency was addressing the Auditors' comments on page 39 with respect to "control deficiencies." Director Steele advised this was a generic statement the auditors include in the event of a control deficiency. However, they had not identified any such deficiencies with respect to the Agency. Motion -Boardmember Gonzalez /Second -Boardmember Garbarino: receive and accept the Annual Redevelopment Report. Unanimously approved by voice vote. ADJOURNMENT Being no further business, Chairwoman Matsumoto adjourned the meeting at 7:05 p.m. Submitted b~/: ~, r ~~----~_ ~_~ Krista Martinelli-Larson, Clerk City of South San Francisco Approved: Karyl Matsumoto, Chairwoman City of South San Francisco REGULAR REDEVELOPMENT AGENCY MEETING MINUTES FEBRUARY 11, 2009 PAGE 5