1990 12 18 RDAd_ REDEVELOPMENT AGENCY
AGENDA
CITY COUNCIL CHAMBERS
78-105 Calle Estado
La Quinta, California 92253
REGtJLAR KKETING
December 18, 1990 7:00
CALL TO ORDER Beginning Res. No. RA 90-9
a) Roll Call
PUBLIC HEARINGS
BUSINESS SESSION
CONSENT CALENDAR
1. Approval of Minutes of December 4, 1990.
2. Approval of Appropriation of Funds from the Low-Mod Housing Fund for
the Continuation of the Sewer Subsidy Program.
3. Authorization to Call for Bids for Bear Creek Channel Bike Path.
CLOSED SESSION
a. Discussion of Negotiations with Transpacific Development Co. Regarding
Specific Plan 39-14 Pursuant to Government Code Section 54956.8.
ADJOURNMENT
DECLARATION OF POSTING
I. Saundra L. Juhola, Secretary of the La Quinta Redevelopment Agency. do
hereby declare that the foregoing agenda for the Redevelopment Agency Meeting
of December 18, 1990 was posted on the outside entry to the Council Chamber,
78-105 Calle Estado and on the bulletin board at the La Quinta Post Office on
Friday, December 14. 1990.
Z
ZUNDRA L. Z
La Quinta. Redevelopment Agency
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d_ MEMORANDUM
TO: The Honorable Mayor and Members of the Council
FROM: Ronald L. Kiedrowski, City Manager
DATE: December 18, 1990
SUBJECT: LA QUINTA TS RESTAURANT DEVELOPMENT PROJECT
Attached is correspondence from the Rosenow Spevacek Group
regarding the referenced development project. In summary the
correspondence indicates that this development project which is
located on the north side of Highway 111 and west of Point Happy
will require Agency assistance to make the project viable. The
project includes an upscale restaurant and office complex, and is
considered an entry point to our Highway 111 Corridor. It is
anticipated that Agency assistance will be required to line the
Whitewater Channel on both the north and west sides of the project.
Agency Council and staff are currently preparing an Owner
Participation Agreement to accomplish Agency assistance and project
completion. The City Manager requests authorization to sign and
execute the necessary Owner Participation Agreement with an Agency
contribution not to exceed $250,000.
RECOMMENDATION:
Authorize City Manager to execute the necessary Owner Participation
Agreement with an Agency contribution not to exceed $250,000.
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d_ A
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a Z
OsENOwsPEVZqcEK GROUP INC.
DATE: December 12, 1990
TO: Tom Genovese, Assistant City Manager
CITY OF LA QUINTA
Z V
Zames
FROM: D. Williams, RSG
Frank J. Spevacek, RSG I
SUBJECT: LA QUINTA TS DEVELOPMENT PROJECT
Based upon the information provided by the developer we have prepared pro formas for
the restaurant and the office building proposed by TS Development. The pro formas were
prepared to assist the Agency in determining whether financial assistance by the Agency is
necessary to ensure successful project completion. In order to provide a complete analysis,
separate pro formas were prepared for the office and for the restaurant. Each is analyzed
as a separate development project with parking allocated as necessary to the development.
Site costs and landscaping are also allocated as prescribed by each development. The
restaurant would be the first structure to be built and no determination has been made by
the developer as yet for the development date of the office structure.
Land purchase costs are included for both structures and an additional land rental payment
is included for the restaurant. According to the developer, this rental payment is necessary
to fully cover the total land cost. When normal operating costs for the restaurant are
included with this land rental payment, the project becomes very marginal financially. As
noted in the operating pro forma the Free and Clear return is 6.4% and this return should
be approximately 10% for a successful project. The returns on cash investment are in the
3% to 5% range in the early years of the development as can be seen in the Cash on Cash"
line of the pro forma. These returns should be approximately 11% to 12% or better.
Finally the Internal Rate of Return is 6.4%, a measure which should be closer to 12% to
15%.
The office component presents a more successful economic model with the following
projected returns:
Free and Clear 11.3%
Cash on Cash 18.7%
IRR 21.5%
These returns are, however, based on a net monthly rate of $1.50 per square foot. This is a
very aggressive rental rate and it is not clear to us that such a rental rate could be achieved.
Discussion with the developer did not provide an answer to the question.
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d_Tom Genovese, Assistant City Manager
CITY OF LA QUINTA
December 12, 1990
Page 2
Based on the information provided it is our opinion that assistance by the Redevelopment
Agency would be aPPro?riate for successful project completion. However, we would need
additional information rom the developer to formulate a recommendation on a specific
dollar amount. This information would best be collected through a meeting with the
developer that has your advance blessing.
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d_ Z
OF
COUNCIL MEETING DATE: December 18, 1990 AGENDA CATEGORY:
PUBLIC HEARING:
ITEM TITLE:
BUSINESS SESSION:
APPROVAL OF APPROPRIATION OF FUNDS FROM THE
REDEVELOPMENT AGENCY LOW-MOD HOUSING FUND FOR CONSENT CALENDAR:
THE CONTINUATION OF THE SEWER SUBSIDY PROGRAM.
STUDY SESSION:
BACKGROUND:
Due to the success of the sewer subsidy program, more funds are needed so
that additional households may take advantage of the project.
FISCAL IMPLICATIONS:
The $125,000 necessary is available in the Redevelopment Agency Low-Mod
Housing Fund for transfer.
APPROVED BY:
RECOMMENDATION:
Authorize transfer of funds from the Redevelopment Agency Low-Mod Housing
Fund to the following accounts:
1) 062-5000-006-001 $25,000, 2) 062-5000-006-002 $50,000, and
3) 062-5000-006-003 $50,000 for the continuation of the sewer subsidy
program.
Submitted by: Approved for submission to
City Council:
/ / /< / 4
I
Signature RONALD L. KIEDROWSKI, CITY MANAGER
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199
d_REDEVELOPMENT AGENCY
MEETING DATE: December 18, 1990 AGENDA CATEGORY:
ITEM TITLE: PUBLIC HEARING:
Authorization to call for bids BUSINESS SESSION:
for the Construction of Bear
Creek Bike Path. CONSENT CALENDAR: 3
STUDY SESSION:
BACKGROUND:
The Bear Creek Bike Path is an approved capital improvement
project in the FY 90 91 Budget. The project consists of
constructing an 8-foot wide portland cement concrete bike path
from the top of the Cove at the intersection of Calle Tecate and
Avenida Montezuma southerly along the Bear Creek Flood Control
Channel then eventually passing into the street right of way
along Avenida Montezuma, Avenida Carranza, Calle Tampico and
Eisenhower Drive street right of ways and terminating at the
south end of the Eisenhower Drive Bridge that crosses over the
Oleander Reservoir. Kicak & Associates commenced design work on
the construction plans in May 1990 and the plans are currently
under final review by the Coachella Valley Water District for
comment.
FISCAL IMPLICATIONS: APPROVED BY:
The FY 90 91 Budget has appropriated $360,000 of
Redevelopment Funds for this project. Subsequent to budget
approval, the City received a $50,000 grant of SB-821 Program
Funds for this project from the Riverside County Transportation
Commission. The Engineer's Estimate for this project is $478,675
which forecasts a $68,675 overall shortfall if the bids resemble
the estimate. Nevertheless, staff recommends that a call for
bids be made so the actual construction cost can be obtained. If
the bids exceed the available funding, the project can be
reevaluated and scaled back in size or additional funds
identified and appropriated to construct it as proposed.
RECOMMENDATION:
It is recommended that the Redevelopment Agency authorize the
Executive Director to call for bids for the construction of the
Bear Creek Bike Path.
Submitte by: Approved for submission to
Redev1e1opnZ,enZ Agency:
RON ZKIEDRZWSKI, EXECUTIVE DIRECTOR
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