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2004 04 06 RDAe4 4,4atwaj Redevelopment Agency Agendas are Available on the City's Web Page @ www.la-quinta.org REDEVELOPMENT AGENCY AGENDA CITY COUNCIL CHAMBERS 78-495 Calle Tampico La Quinta, California 92253 Regular Meeting Tuesday, April 6, 2004 - 2:00 P.M. Beginning Resolution No. RA 2004-04 CALL TO ORDER Roll Call: Agency Board Members: Adolph, Osborne, Perkins, Sniff,. and Chairperson Henderson PUBLIC COMMENT At this time, members of the public may address the Redevelopment Agency on any matter not listed on the agenda. Please complete a "request to speak" form and limit your comments to three minutes. Please watch the timing device on the podium. CLOSED SESSION NOTE: Time permitting; the Redevelopment Agency Board may conduct Closed Session discussions during the dinner recess. In addition, persons identified as negotiating parties are not invited into the Closed Session meeting when the Agency is considering acquisition of real property. 1. CONFERENCE WITH AGENCY'S LEGAL COUNSEL PURSUANT TO GOVERNMENT CODE SECTION 54956.9(c), INITIATION OF LITIGATION (ONE MATTER.) i Redevelopment Agency Agenda 1 April 6, 2004 2. CONFERENCE WITH AGENCY'S LEGAL COUNSEL PURSUANT TO GOVERNMENT CODE SECTION 54956.9(a), PENDING LITIGATION, LA QUINTA REDEVELOPMENT AGENCY, ET AL., v. ALL PERSONS INTERESTED IN THE MATTER OF THE LOAN AGREEMENT, ETC., RIVERSIDE SUPERIOR CASE NO. INC 041253. 3. CONFERENCE WITH AGENCY'S REAL PROPERTY NEGOTIATOR, MARK _ WEISS, PURSUANT TO GOVERNMENT CODE SECTION 54956.8 CONCERNING POTENTIAL TERMS AND CONDITIONS OF ACQUISITION AND/OR DISPOSITION OF A PORTION OF 525 t ACRES LOCATED AT THE SOUTHWEST CORNER OF AVENUE 52 AND JEFFERSON STREET. PROPERTY OWNER/NEGOTIATOR: MATT HLADEK. 4. CONFERENCE WITH AGENCY'S REAL PROPERTY NEGOTIATOR, JERRY HERMAN, PURSUANT TO GOVERNMENT CODE SECTION 54956.8 CONCERNING POTENTIAL TERMS AND CONDITIONS OF ACQUISITION AND/OR DISPOSITION OF REAL PROPERTY LOCATED AT 78-990 MILES AVENUE - APN 604-032-022. PROPERTY OWNER/ NEGOTIATOR: SHEILA WELDON RECONVENE AT 3:00 P.M. PUBLIC COMMENT At this time members of the public may address the Agency Board on items that appear within the Consent Calendar or matters that are not listed on the agenda. Please complete a "request to speak" form and limit your comments to three minutes. When you are called to speak, please come forward and state your name for the record. Please watch the timing device on the podium. For all Agency Business Session matters or Public Hearings on the agenda, a completed "request to speak" form should be filed with the City Clerk prior to the Agency beginning consideration of that item. CONFIRMATION OF AGENDA APPROVAL OF MINUTES 1. APPROVAL OF MINUTES OF MARCH 16, 2004. Redevelopment Agency Agenda 2 April 6, 2004 CONSENT CALENDAR NOTE: Consent Calendar items are considered to be routine in nature and will be approved by one motion. 1. APPROVAL OF DEMAND REGISTER DATED APRIL 6, 2004. BUSINESS SESSION 1. CONSIDERATION OF AN AGREEMENT THAT ASSIGNS AFFORDABLE HOUSING OBLIGATIONS PERTAINING TO A 26-UNIT APARTMENT COMPLEX LOCATED AT 51-025 - 51-085 AVENIDA MARTINEZ FROM LA QUINTA 34, LLC (LAWRENCE RAEL, MANAGING MEMBER) TO MAUKA VIEW, LLC (JAMES SORENSON AND JAMES MCKELLAR, MANAGING MEMBERS), DUE TO THE PENDING SALE OF THIS PROPERTY. A. MINUTE ORDER ACTION 2. CONSIDERATION OF INITIAL BRANDING PROCESS FOR SILVERROCK RESORT. A. MINUTE ORDER ACTION. 3. CONSIDERATION OF LOGOS FOR SILVERROCK RESORT. A. MINUTE ORDER ACTION 4. CONSIDERATION OF MODIFICATIONS TO THE CONCEPTUAL MASTER PLAN FOR SILVERROCK RESORT. A. MINUTE ORDER ACTION. STUDY SESSION 1. DISCUSSION OF LA QUINTA ARTS FOUNDATION REQUEST FOR USE OF THE SILVERROCK RESORT PROPERTY FOR THE ARTS FESTIVAL. CHAIR AND BOARD MEMBERS' ITEMS - NONE Redevelopment Agency Agenda 3 April 6, 2004 3 PUBLIC HEARINGS 1. JOINT PUBLIC HEARING OF THE LA QUINTA CITY COUNCIL AND REDEVELOPMENT AGENCY TO CONSIDER ADOPTION OF A RESOLUTION TO USE TAX INCREMENT REVENUE FROM LA QUINTA REDEVELOPMENT PROJECT AREA NO. 1 TO FUND THE CONSTRUCTION OF A LIBRARY FACILITY TO BE LOCATED ON THE CIVIC CENTER CAMPUS. A. RESOLUTION ACTION 2. JOINT PUBLIC HEARING OF THE LA QUINTA CITY COUNCIL AND REDEVELOPMENT AGENCY TO CONSIDER ADOPTION OF A RESOLUTION TO USE TAX INCREMENT REVENUE FROM LA QUINTA REDEVELOPMENT PROJECT AREA NO. 1 TO FUND THE CONSTRUCTION OF CERTAIN PUBLIC FACILITIES LOCATED AT SILVERROCK RESORT. A. RESOLUTION ACTION ADJOURNMENT ADJOURN TO A REGULARLY SCHEDULED MEETING OF THE REDEVELOPMENT AGENCY TO BE HELD ON APRIL 20, 2004, COMMENCING WITH CLOSED SESSION AT 2:00 P.M. AND OPEN SESSION AT 3:00 P.M. IN THE CITY COUNCIL CHAMBERS, 78-495 CALLE TAMPICO, LA QUINTA, CA 92253. DECLARATION OF POSTING I, June S. Greek, City Clerk of the City of La Quinta, do hereby declare that the foregoing agenda for the La Quinta Redevelopment Agency meeting of Tuesday, April 6, 2004, was posted on the outside entry to the Council Chamber, 78-495 Calle Tampico and on the bulletin board at the La Quinta Chamber of Commerce and at Stater Bros. 78-630 Highway 111, on Friday, April 2, 2004. DATED: April 2, 2004 2�;� --cx. '<!�� JUNE S. GREEK, CMC, City Clerk City of La Quinta, California Redevelopment Agency Agenda 4 April 6, 2004 4 T 6 44f 4 AGENDA CATEGORY: COUNCIL/RDA MEETING DATE: APRIL 6, 2004 ITEM TITLE: Demand Register Dated April 6, 2004 RECOMMENDATION: It is recommended the Redevelopment Agency Board: BUSINESS SESSION CONSENT CALENDAR STUDY SESSION PUBLIC HEARING Receive and File the Demand Register Dated April 6, 2004 of which $18,806.15 represents Redevelopment Agency Expenditures. PLEASE SEE CONSENT CALENDAR ITEM NUMBER 1 ON CITY COUNCIL AGENDA J COUNCIL/RDA MEETING DATE: April 6, 2004 ITEM TITLE: Consideration of an Assignment and Assumption Agreement that Assigns Affordable Housing Obligations Pertaining to a 26-Unit Apartment Complex located at 51-025 - 51-085 Avenida Martinez From La Quinta 34, L.L.C. (Lawrence Rael, Managing Member) to Mauka View, L.L.C. (James Sorenson and James McKellar, Managing Members) Due to the Pending Sale of this Property RECOMMENDATION: AGENDA CATEGORY: BUSINESS SESSION: / CONSENT CALENDAR: STUDY SESSION: PUBLIC HEARING: Approve the Assignment and Assumption Agreement that assigns affordable housing obligations pertaining to a 26-unit apartment complex located at 51-025 - 51-085 Avenida Martinez from La Quinta 34, L.L.0 to Mauka View, L.L.C. and authorize the Executive Director to execute the necessary documents. FISCAL IMPACT: None. The Agency previously appropriated $350,000 to fund property purchase and rehabilitation activities; $73,589 of this amount has been expended to date. The Assignment and Assumption Agreement does not result in the expenditure of additional Agency funds. BACKGROUND AND OVERVIEW: On September 13, 2001 the Agency entered into an Affordable Housing Agreement with Lawrence Rael (La Quinta 34, L.L.C.) that funded a $350,000 loan to increase off-street parking and rehabilitate a 34-unit apartment complex located southeast of the intersection of Eisenhower Drive and Calle Tampico. Agency funds were designated to purchase an adjoining 10,000 square foot property that would be improved with off-street parking and carports, increasing the complex's off-street parking inventory. Agency loan funds were also allocated towards replacing the wood mansard roof with tile. In return, the Agency secured 14 of the 34 units as rental housing affordable to moderate income households. To date $73,589 of the $350,000 loan has been allocated towards purchasing the 10,000 square foot parcel, and the tile mansard roof has been installed. A fire subsequently destroyed 8 of the 34 units. Mr. Rael initially proposed to rebuild these units. However, he then elected to use the space once occupied by the eight units as off-street parking for the remaining 26 units, and to develop the 10,000 square foot lot with five or more rental residential units. In December 2002, the Agency approved the First Amendment to the Affordable Housing Agreement that reallocated the remaining $276,411 of Agency loan funds to underwrite building carports for the off-street parking associated with the 26 units, and some of the costs associated with building the five or more new units. Fourteen units continued to be reserved as affordable housing for moderate income families. In February 2004, Agency staff was contacted by both Mr. Rael and James S. Sorenson regarding Agency consideration of transferring the Affordable Housing Agreement from Mr. Rael to a limited liability company controlled by Mr. Sorenson and Mr. McKellar (Mauka View, L.L.C.). They desire to purchase the apartment complex and the adjoining 10,000 square foot parcel from Mr. Rael, build the carports on the parking lot contiguous to the 26 units, erect the five or more new units with carports, and operate the apartment complex. Based upon the resumes and the background information they provided, Mr. Sorenson is an investment adviser and a La Quinta resident, and Mr. McKellar is associated with a property management firm located in Hawaii. The Assumption Agreement provides for the following: • Agency approval to transfer the rights and responsibilities contained in the Affordable Housing Rehabilitation Agreement from Mr. Rael to Mauka View L.L.C.; • Requires Mauka View L.L.C. to construct the carports that will serve the 26 apartment units, and the five or more new units with carports on the 10,000 square foot parcel; • Transfers the remaining $280,000 loan reserved for the carports and the five or more units with carports to the Mauka View, L.L.C. to fund costs related to these improvements; • Establishes a new date to submit a Village Use Permit application related to the carports (30 days after Mauka View L.L.C. acquires fee title to the apartment complex and the 10,000 square foot parcel); 7 02 • Reduces the interest rate from 7 % to 5 % on the Agency loan to reflect current interest rates (loan principal and interest is due and payable only if the 14 units do not remain affordable to moderate income households for 30 years, or if the . Agency -imposed occupancy, maintenance and management covenants are not maintained); and • Requires that 14 units remain affordable to moderate income households for 30 years (since this Agreement was instituted before the Redevelopment Law was amended to require 55 year covenants for multi -family units, the Agency may continue to count these units towards its inclusionary housing requirements even though their term is 30 years). FINDINGS AND ALTERNATIVES: Alternatives available to the Agency Board include: 1. Approve the Assignment and Assumption Agreement that assigns affordable housing obligations pertaining to a 26-unit apartment complex located at 51- 025 — 51-085 Avenida Martinez from La Quinta 34, L.L.0 to Mauka View, L.L.C. to Mauka View, L.L.C. and authorize the Executive Director to execute the necessary documents; or 2. Do not approve the Assignment and Assumption Agreement that assigns affordable housing obligations pertaining to a 26-unit apartment complex located at 51-025 — 51-085 Avenida Martinez from La Quinta 34, L.L.0 to Mauka View, L.L.C. to Mauka View, L.L.C. and do not authorize the Executive Director to execute the necessary documents; or 3. Provide staff with. alternative direction. Respectfully submitted, J HFX HernUn C unity Development Director Approved for submission: Thomas P. Genovese, Executive Director Attachment: 1. Assignment and Assumption Agreement 03 ATTACHMENT 1 ASSIGNMENT AND ASSUMPTION AGREEMENT This ASSIGNMENT AND ASSUMPTION AGREEMENT ("Agreement") is entered into as of this 6th day of April, 2004, by and among the LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic ("Agency"), LA QUINTA 34 LLC, a California limited liability company ("Seller"), and MAUKA VIEW, LLC, a California limited liability company ("Purchaser"). RECITALS A. On or about September 13, 2001, Agency and Seller entered into that certain Affordable Housing Rehabilitation Agreement, as amended by that certain First Amendment to Affordable Housing Rehabilitation Agreement dated December 17, 2002 (collectively, the "Housing Agreement"). The Housing Agreement provides for Seller to rehabilitate that certain real property more particularly described therein as the "Site." Any capitalized terms contained in this Second Amendment which are not defined herein shall have the meaning given in the Housing Agreement, unless expressly provided to the contrary. B. Pursuant to the Housing Agreement, Agency agreed to provide a loan to Seller in the amount of Three Hundred Fifty Thousand Dollars ($350,000) ("Rehabilitation Loan") for Seller's rehabilitation of the Site. The Rehabilitation Loan is evidenced by that certain Note dated September 13, 2001 ("Agency Note"). The Agency Note is secured by that certain Deed of Trust With Assignment of Rents and Rider Attached Hereto dated September 13, 2001, from Seller, as trustor, in favor of Agency, as beneficiary, recorded on September 28, 2002, as Instrument No. 2001-474253 in the Official Records of Riverside County, California ("Agency Deed of Trust"). C. Pursuant to the Housing Agreement, Agency and Seller entered into that certain Regulatory Agreement and Declaration of Covenants and Restrictions dated September 13, 2001, and recorded on September 28, 2001, as Instrument No. 2001-474254 in the Official Records of Riverside County, California ("Regulatory Agreement"), which places covenants on the use and operation of the Site to ensure that the Site is operated as a rental housing project with fourteen (14) units to be rented and occupied by moderate income households at affordable rent. D. Seller desires to sell the Site to Purchaser and Purchaser desires to purchase the Site from Seller and to assume the obligations of Seller under the Housing Agreement, Agency Note, Agency Deed of Trust, and Regulatory Agreement (collectively, the "Agency Agreements"). E. The Agency Agreements prohibit Seller from transferring or selling any interest in the Site or assigning the Agency Agreements without Agency's approval. F. Seller and Purchaser have requested that Agency approve the transfer of the Site to Purchaser, and the assignment of the Rehabilitation Loan and Agency Agreements by Seller to Purchaser. In addition, Purchaser has requested that Agency reduce the interest rate under the Rehabilitation Loan and modify the Housing Agreement to, among other things, extend the time under the Housing Agreement to submit the application for the village use permit for the 538/015610-0040 04 485158.02 a03/31104 installation of the carports. Agency has agreed to consent to the transfer of the Site to Purchaser, the assignment and assumption of the Agency Loan and Agency Agreements between Seller and Purchaser, and to modify the Rehabilitation Loan and Housing Agreement, subject to the terms and conditions set forth in this Agreement. AGREEMENT Based upon the foregoing Recitals, which are incorporated herein by this reference, and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Agency, Seller and Purchaser agree as follows: 1. Definitions. The following terms as used in this Agreement shall have the meanings given below unless expressly provided to the contrary: "Acquisition Parcels" shall mean the portion of the Site known as Assessor Parcel Nos. 773-073-004 and 005. "Agreement" shall mean this Assignment and Assumption Agreement among Agency, Seller, and Purchaser, including all exhibits and other documents attached hereto. "Agency Agreements" shall collectively refer to the Housing Agreement, Agency Note, Agency Deed of Trust, and Regulatory Agreement. "Agency Deed of Trust" shall mean that certain Deed of Trust With Assignment of Rents and Rider Attached Hereto dated September 13, 2001, from Seller, as trustor, in favor of Agency, as beneficiary, recorded on September 28, 2002,' as Instrument No. 2001-474253 in the Official Records of Riverside County, California, securing the obligations under the Agency Note. "Agency Note" shall have the meaning ascribed in Recital B of this Agreement. "Allonge to Note" shall mean the Allonge to Note to be entered into by Agency and Purchaser in the form attached as Attachment No. 3 to this Agreement. "Apartment Parcel" shall mean the portion of the Site known as Assessor Parcel No. 773- 071-017. "Effective Date" shall have the meaning ascribed in Section 2 of this Agreement. "Escrow" shall mean the escrow that has been opened with the Escrow Agent for Purchaser's acquisition of the Site under Escrow Nos. 1-2428-RJ and 1-2429-RJ. "Escrow Agent" shall mean Escrow Avenue whose offices are located at 95 Argonaut, Suite 230, Aliso Viejo, CA 92656. "Housing Agreement" shall mean that certain Affordable Housing Rehabilitation Agreement between Agency and Seller dated September 13, 2001, as amended by that certain First Amendment to Affordable Housing Rehabilitation Agreement dated December 17, 2002. 10 538/015610-0040 485158.02 a03/31/04 -2- "Memorandum of Agreement" shall mean the Memorandum of Assignment and Assumption Agreement to be entered into by Agency and Purchaser in the form attached as Attachment No. 1 to this Agreement. "Modification of Deed of Trust" shall mean the Modification of Deed of Trust in the form attached to this Agreement as Attachment No.4 to be entered into by Agency and Purchaser. "Rehabilitation Loan" shall have the meaning ascribed in Recital B to this Agreement. . "Regulatory Agreement" shall mean the Regulatory Agreement and Declaration of Covenants and Restrictions between Agency and Seller dated September 13, 2001, and recorded on September 28, 2001, as Instrument No. 2001-474254 in the Official Records of Riverside County, California ("Regulatory Agreement'), which places covenants on the use and operation of the Site. "Second Amendment" shall mean the Second Amendment to Affordable Housing Rehabilitation Agreement to be entered into by Agency and Purchaser in the form attached to this Agreement as Attachment No. 21 which provides for the Housing Agreement to be amended. "Site" shall have the meaning ascribed in Recital A of this Agreement. "Title Company" shall mean First American Title Insurance Company having its offices at 2 First American Way, Santa Ana, CA 92707. "Transfer Conditions" shall mean the conditions set forth in Section 2 of this Agreement that must be satisfied before the transfer of the Site and the assignment of the Agency Agreements are permitted. 2. Conditions Precedent; Effective Date. This transfer of the Site from Seller to Purchaser and the assignment contemplated under this Agreement, and Agency's approval thereof, is contingent and conditional upon the satisfaction of the following conditions precedent (collectively, the "Transfer Conditions") and such transfer and assignment shall not become effective until the Transfer Conditions are satisfied: (a) Agency Title Policy. Title Company is irrevocably committed to issue to Agency a lender's policy of title insurance ("Agency Title Policy"), with liability in the amount of the Rehabilitation Loan, showing fee title to the Site vested in Purchaser, insuring in favor of Agency the Agency Deed of Trust as modified by the Modification of Deed of Trust, subject only to (i) the standard printed exceptions and exclusions contained in the form of the Title Policy commonly used by the Title Company; (ii) non -delinquent property taxes and assessments; (iii) as to the Acquisition Parcels, the deed of trust in favor of LaJolla Bank in the amount of $105,000 securing the loan to Purchaser for the acquisition of the Acquisition Parcels; (iv) as to the Apartment Parcel, the deed of trust in favor of LaJolla Bank in the amount of $1,770,000 securing the loan to Purchaser for the acquisition of the Apartment Parcel; and (v) such other matters as may be approved by Agency in its sole and absolute discretion. 538/015610-0040 485158.02 a03/31/04 -3- (b) Execution and Delivery of Documents. Purchaser shall have executed and delivered to Agency the documents referred to in Section 8 of this Agreement. (c) Insurance. Purchaser has provided Agency the evidence of .insurance required pursuant to Section 8.0 of the Housing Agreement and Section 7.0 of the Regulatory Agreement. The date that all of the Transfer Conditions are satisfied and the grant deed conveying fee title to the Site to the Purchaser has been recorded in the Official Records of Riverside County, California shall be the "Effective Date." Seller shall not transfer and Purchaser shall not accept title to the Site until all of the Transfer Conditions are satisfied. If the Transfer Conditions are not satisfied on or before May 20, 2004, or such later date as the parties may mutually agree in writing in the sole and absolute discretion of each of them, each party shall have the right to terminate this Agreement by delivery of written notice to the other parties. 3. Assignment. Effective on the Effective Date, Seller hereby assigns to Purchaser all of Seller's rights, title, and interest in and to the Housing Agreement, the Agency Note, the Agency Deed of Trust, and the Regulatory Agreement (collectively, the "Agency Agreements"), including the right to receive disbursements of the Rehabilitation Loan. 4. Assumption. Effective on the Effective Date, Purchaser hereby accepts the foregoing assignment, assumes the Agency Agreements, and agrees to timely pay, perform and discharge all of the obligations of Seller under the Agency Agreements, including without limitation construction of the Minimum Improvements described in Paragraphs A.1 and A.3 of the Scope of Development attached to the First Amendment to Affordable Housing Rehabilitation Agreement as Attachment No. 1, and payment of the Rehabilitation Loan upon the occurrence of certain events described in the Agency Note. Purchaser acknowledges that if the events permitting Agency to accelerate the Rehabilitation Loan occur, Purchaser shall be required to repay the Rehabilitation Loan disbursed by Agency and interest thereon, including the portion of the Rehabilitation Loan disbursed to Seller prior to the Effective Date. As of the date of this Agreement, Agency has disbursed to Seller Rehabilitation Loan proceeds in the amount of Seventy Thousand Dollars ($70,000). 5. Seller's Relinquishment of Rehabilitation Loan. Effective on the Effective Date, Seller hereby releases Agency from and relinquishes all rights, claims, demands, and obligations of any kind or nature, whether known or unknown, suspected or unsuspected, against Agency with respect to disbursements of proceeds of the Rehabilitation Loan, and agrees it shall not bring any claims for or seek disbursements of the Rehabilitation Loan for any work performed, prior to or after the Effective Date, including any of the Minimum Improvements or the Additional Improvements (as those terms are described in the Scope of Development attached to the First Amendment to Affordable Housing Rehabilitation Agreement). 6. Consent by Agency. Provided all of the Transfer Conditions are satisfied in full, effective on the Effective Date, Agency consents to the transfer of the Site to Purchaser and the assignment of the Agency Agreements by Seller to Purchaser and the assumption of the Agency Agreements by Purchaser. Such consent by Agency shall not constitute a consent to any further 1� 538/015610-0040 07 485158.02 a03/31/04 —4— or subsequent sale, conveyance, transfer or assignment of the Site or the Agency Agreements, or any part thereof, or any interest therein. 7. Amendment to Housing Agreement and Rehabilitation Loan. Item 11 of the Schedule of Performance attached as Attachment No. 1 to the First Amendment to Affordable Housing Rehabilitation Agreement requires Seller to submit to Agency an application for a village use permit within sixty days after the completion of the asphalt paving on the Apartment Parcel. As of the date of this Agreement, the asphalt paving has been completed but the application for the village use permit has not been submitted. Purchaser has requested Agency extend the date to submit the application. In addition, Purchaser has requested Agency reduce the interest rate under the Agency Note for interest accruing after the Effective Date from seven percent (7%) to five percent (5%). Agency has agreed to extend the date to submit the application for the village use permit and to reduce the interest under the Agency Note provided that the Transfer Conditions are satisfied and the Site is transferred to Purchaser. In connection therewith and to effectuate those modifications, Agency and Purchaser shall enter into the Second Amendment, the Allonge to Note, and the Modification of Deed of Trust as set forth in Section 8 of this Agreement, each to become effective on the Effective Date. 8. Execution and Delivery of Memorandum and Modification Documents. No later than ten (10) days prior to the date Purchaser and Seller are scheduled to close the Escrow for the conveyance of the Site, Purchaser shall deliver to Agency in trust all of the following documents: (a) the Memorandum of Agreement, executed and acknowledged by Purchaser; (b) two copies of the Second Amendment, executed by Purchaser; (c) the Allonge to Note, executed by Purchaser; and (d) the Modification of Deed of Trust, executed and acknowledged by Purchaser. Agency shall execute and acknowledge the Memorandum of Agreement and the Modification of Deed of Trust and shall deposit said documents into the Escrow with instructions to the Escrow Agent to record said documents concurrently with Purchaser's acquisition of the Site provided the Transfer Conditions have been satisfied. Agency shall execute both copies of the Second Amendment and the Allonge to Note and, within ten (10) days after the Effective Date, provide Purchaser one fully signed original of the Second Amendment and one copy of the executed Allonge to Note. The agreements referred to in this Section 8 shall not become operative until the Effective Date notwithstanding that they may be executed prior to the Effective Date. In the event this Agreement is terminated pursuant to Section 2, any documents delivered by Agency and Purchaser under this Agreement shall be returned to it. 9. Escrow and Closing Costs. Seller and Purchaser each shall pay one-half of any Escrow fees attributable to the transactions contemplated under this Agreement. Seller shall pay the premium for the Agency Title Policy referred to in Section 2(a) of this Agreement; it being understood that Seller was obligated to deliver a lender's title insurance policy to Agency under Section 3.4 of the Housing Agreement and that obligations has not been performed. 10. Acknowledgment of Agreement to Hold Property as One Parcel. Purchaser acknowledges that the Site is encumbered by that certain Declaration of Covenants, Conditions, 13 538/015610-0040 (� 485158.02 a03/31/04 —5— 0 and Restrictions and Agreement to Hold Property as One Parcel dated September 13, 2001, recorded on September 28, 2001, as Instrument Number 2001-474255 in the Official Records of Riverside County, California, which provides for the parcels comprising the Site to be held under common ownership and Purchaser covenants and agrees to be bound by said agreement from and after the Effective Date. 11. Miscellaneous. 11.1 Entire Agreement, Waivers and Amendments. This Agreement, together with the Agency Agreements and other agreements referred to herein, incorporates all of the terms and conditions mentioned herein, or incidental hereto, and supersedes all negotiations and previous agreements among the parties with respect to all or part of the subject matter hereof. All waivers of the provisions of this Agreement must be in writing and signed by the appropriate authorities of the party to be charged. A waiver of the breach of the covenants, conditions or obligations under this Agreement by either party shall not be construed as . a waiver of any succeeding breach of the same or other covenants, conditions or obligations of this Agreement. Any amendment or modification to this Agreement must be in writing and executed by the appropriate authorities of Agency, Seller and Purchaser. 11.2 Severability. If any term, provision, covenant, or condition of this Agreement is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remaining provisions of the Agreement shall continue in full force and effect, unless and to the extent the rights and obligations of one or both parties has been materially altered or abridged by such holding. 11.3 Applicable Law. This Agreement shall be construed and enforced in accordance with the internal laws of the State of California. 11.4 Litigation Expenses. If any party to this Agreement commences an action against any other party to this Agreement arising out of or in connection with this Agreement, the prevailing party shall be entitled to recover reasonable attorneys' fees, expert witness fees, costs of investigation, and costs of suit from the losing party. 11.5 Authority. The persons executing this Agreement on behalf of the parties hereto warrant that they are duly authorized to execute this Agreement on behalf of said parties and that by so executing this Agreement, the parties hereto are formally bound to the provisions of this Agreement. 11.6 Execution in Counterpart. This Agreement may be executed in several counterparts, and all so executed shall constitute one agreement binding on all of the parties hereto, notwithstanding that all parties are not signatories to the original or the same counterpart. [signatures on next page] 538/015610-0040 485158.02 a03/31/04 -6- 09 IN WITNESS WHEREOF, Agency, Seller, and Purchaser have entered into this Agreement as of the date first written above. ATTEST: Agency Secretary APPROVED AS TO FORM: RUT & T CKER, LLP Attorneys for the La Quinta Redevelopment Agency "AGENCY" LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic M Executive Director "SELLER" LA TA 3 C, a California limited lia lity comp B Y• Lawrence C. Rael, Managi g Member "PURCHASER" MAUKA VIEW, LLC, a California limited liabilit company 3 f Y James S. Sorenson, on behalf of the Sorenson Family 2001 Revocable Trust, Member 538/015610-0040 91 1 485158.02 a03/31/04 -7- ATTACHMENT NO. 1 MEMORANDUM OF ASSIGNMENT AND ASSUMPTION AGREEMENT [Attached] 538/015610-0040 485158.02 a03/31/04 RECORDED AT THE REQUEST OF AND WHEN RECORDED RETURN TO: La Quinta Redevelopment Agency 78-495 Calle Tampico La Quinta, CA 92253 Attn: Executive Director (SPACE ABOVE FOR RECORDER'S USE) This Memorandum of Assignment and Assumption Agreement is recorded at the request and for the benefit of the La Quinta Redevelopment Agency and is exempt from the payment of a recording fee pursuant to Government Code Section 27383. MEMORANDUM OF ASSIGNMENT AND ASSUMPTION AGREEMENT This MEMORANDUM OF ASSIGNMENT AND ASSUMPTION AGREEMENT ("Memorandum") is dated as of , 2004, and entered into by and between the LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic ("Agency"), and MALTKA VIEW, LLC, a California limited liability company ("Purchaser"). This Memorandum is made with reference to the following: 1. On or about the date of the recordation of this Memorandum, Purchaser acquired from La Quinta 34 LLC, a California limited liability company ("Seller"), fee title to that certain real property located in the City of La Quinta, County of Riverside, State of California, more particularly described in the legal description attached hereto as Exhibit "A" and incorporated herein by this reference ("Site"). 2. On or about September 13, 2001, Agency and Seller entered into that certain Affordable Housing Rehabilitation Agreement, as amended by that certain First Amendment to Affordable Housing Rehabilitation Agreement dated December 17, 2002 (collectively, the "Housing Agreement"). The Housing Agreement provides for Seller to construct certain improvements on the Site. 3. Pursuant to the Housing Agreement, Agency agreed to provide a loan to Seller in the amount of Three Hundred Fifty Thousand Dollars ($350,000) ("Rehabilitation Loan") for Seller's rehabilitation of the Site. The Rehabilitation Loan is evidenced by that certain Note dated September 13, 2001 ("Agency Note"). The Agency Note is secured by that certain Deed of Trust With Assignment of Rents and Rider Attached Hereto dated September 13, 2001, from Seller, as trustor, in favor of Agency, as beneficiary, recorded on September 28, 2002, as Instrument No. 2001-474253 in the Official Records of Riverside County, California ("Agency Deed of Trust"). .17 538/015610-0040 12 485158.02 a03/31 /04 -1- 4. Pursuant to the Housing Agreement, Agency and Seller entered into that certain Regulatory Agreement and Declaration of Covenants and Restrictions dated September 13, 2001, and recorded on September 28, 2001, as Instrument No. 2001-474254 in the Official Records of Riverside, California, which places covenants on the use and operation of the Site to ensure that the Site is operated as a rental housing project with fourteen (14) units to be rented and occupied by moderate income households at affordable rent. 5. In connection with and effective upon Purchaser's acquisition of the Site, Seller assigned to Purchaser and Purchaser assumed from Seller the obligations of Seller under the Housing Agreement, the Agency Note, the Agency Deed of Trust, and the Regulatory Agreement as more fully set forth in that certain Assignment and Assumption Agreement ("Assignment") among Seller, Purchaser and Agency dated April 6, 2004. 6. The parties desire to enter into this Memorandum and to record the same in the Official Records of Riverside County, California, to provide record notice to all persons of the Assignment. 7. This Memorandum may be executed in several counterparts, and all so executed shall constitute one agreement binding on both parties hereto, notwithstanding that both parties are not signatories to the original or the same counterpart. [signatures on next page] IV 538/015610-0040 13 485158.02 a03/31/04 -2- IN WITNESS WHEREOF, Agency and Purchaser have entered into this Memorandum as of the date first set forth above. ATTEST: Agency Secretary APPROVED AS TO FORM: RUTAN & TUCKER, LLP Attorneys for the La Quinta Redevelopment Agency "AGENCY" LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic LIM Executive Director "PURCHASER" MAUKA VIEW, LLC, a California limited liability company By: James S. Sorenson, on behalf of the Sorenson Family 2001 Revocable Trust, Member 538/015610-0040 14 10 485158.02 a03/31 /04 _3 _ STATE OF CALIFORNIA ) ) ss COUNTY OF ) On , before me, personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s) acted, executed the instrument. Witness my hand and official seal. Notary Public [SEAL] STATE OF CALIFORNIA ) ) ss COUNTY OF On , before me, , personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s) acted, executed the instrument. Witness my hand and official seal. Notary Public [SEAL] 40 538/015610-0040 15 485158.02 a03/31/04 -4- EXHIBIT "A" TO MEMORANDUM LEGAL DESCRIPTION OF SITE All that certain property located in the City of La Quinta, County of Riverside, State of California, described as follows: LOTS 1 TO I INCLUSIVE IN BLOCK 126 OF SANTA CARMELITA AT VALE LA QUINTA, UNIT NO. 14, IN THE CITY OF LA QUINTA, COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 18 PAGES 82 AND 83 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. EXCEPTION THEREFROM THOSE PORTIONS OF LOTS 11, 5, 6 AND II, DEEDED TO THE COUNTY OF RIVERSIDE, BY DOCUMENTS RECORDED MARCH 23, 1978 AS INSTRUMENT NOS. 55038 AND 55039 OF OFFICIAL RECORDS OF RIVERSIDE COUNTY, CALIFORNIA. LOTS 6 AND 7 IN BLOCK 125 OF SANTA CARMELITA AT VALE LA QUINTA UNIT NO. 14, AS SHOWN BY MAP RECORDED IN BOOK 18, PAGE 82 OF MAPS, RECORDS OF RIVERSIDE COUNTY, CALIFORNIA. 538/015610-0040' 485158.02 a03/31/04 ATTACHMENT NO.2 SECOND AMENDMENT TO AFFORDABLE HOUSING REHABILITATION AGREEMENT [Attached] 17 538/015610-0040 485158.02 a03/31/04 (?4r) SECOND AMENDMENT TO AFFORDABLE HOUSING REHABILITATION AGREEMENT This SECOND AMENDMENT TO AFFORDABLE HOUSING REHABILITATION AGREEMENT ("Second Amendment") is dated as of 2004, and entered into by and between the LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic ("Agency"), and MAUKA. VIEW, LLC, a California limited liability company ("Participant"). RECITALS A. On or about September 13, 2001, Agency and La Quinta 34 LLC, a California limited liability company ("Original Participant"), entered into that certain Affordable Housing Rehabilitation Agreement which provides for Agency to loan to Original Participant funds for Participant's rehabilitation of that certain real property more particularly described therein as the "Site" ("Original Agreement"). B. On or about December 17, 2002, Agency and Original Participant entered into that certain First Amendment to Affordable Housing Rehabilitation Agreement ("First Amendment"). The Original Agreement and the First Amendment are collectively referred to in this Second Amendment as the "Housing Agreement." C. On or about April 6, 2004, Agency, Original Participant and Participant entered into that certain Assignment and Assumption Agreement ("Assignment Agreement") which provides for Original Participant to assign the Housing Agreement to Participant upon the satisfaction of certain conditions. Provided those conditions are satisfied, Participant and Agency desire to amend the Housing Agreement on the terms set forth in this Second Amendment. AGREEMENT Based upon the foregoing Recitals, which are incorporated herein by this reference, and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Agency and Participant agree as follows: 1. Defined Terms. Any capitalized terms contained in this Second Amendment which are not defined herein shall have the meaning given in the Housing Agreement, unless expressly provided to the contrary. 2. Effective Date. This Second Amendment shall become effective on the Effective Date of the Assignment Agreement. The "Effective Date" is the date Participant acquires fee title to the Site after the satisfaction of certain conditions referred to in the Assignment Agreement as the "Transfer Conditions," as more fully explained in Section 2 of the Assignment Agreement. If the Transfer Conditions are not satisfied and the Assignment Agreement is terminated in accordance with the terms set forth in the Assignment Agreement, this Second Amendment shall automatically terminate upon the termination of the Assignment Agreement. 538/015610-0040 485158.02 a03/31/04 3. Project; Scope of Development. The Housing Agreement provides for Participant to construct five (5) apartment units on the Acquisition Parcel. Participant may desire to construct more than five (5) apartment units on the Acquisition Parcel and Agency has agreed that Participant will not be restricted by the Housing Agreement from constructing more than five (5) units. In order to effectuate this modification, Paragraph A.1 of the Scope of Development attached to the First Amendment as Attachment No. 1 is hereby modified to read: "The Acquisition Parcel shall be improved with at least 5 new apartment units, parking for the units, and landscaping." Notwithstanding the foregoing, Participant understands and acknowledges that Agency cannot guarantee the number of units that ultimately will be approved for development on the Acquisition Parcel as that determination is subject to the City's normal planning review process. 4. Schedule of Performance. Agency has agreed to extend the time for Participant to submit the application for the village use permit for the construction of the carports on the Apartment Parcel. Accordingly, the time for performance of Item 10 (submittal of application for village use permit for carports) in the Schedule of Performance attached to the First Amendment as Attachment No. 2 is hereby amended to read "On or before the date that is thirty (30) days after the date Mauka View, LLC acquires fee title to the Site from La Quinta 34 LLC." 5. Modification of Loan. Participant has requested that Agency modify the Rehabilitation Loan by reducing the interest rate from seven percent (7%) to five percent (5%) effective from and after the Effective Date. Pursuant to the Assignment Agreement, Agency and Participant entered into an Allonge to Note and a Modification of Deed of Trust to implement this modification. Effective as of the Effective Date, all references in the Housing Agreement to the "Agency Note" shall mean and refer to the Agency Note, as amended by the Allonge to Note, all references in the Housing Agreement to the "Agency Deed of Trust" shall mean and refer to the Agency Deed of Trust, as amended by the Modification of Deed of Trust, and all references in the Housing Agreement to the "Rehabilitation Loan" shall mean the Rehabilitation Loan, as amended in those documents. 6. Full Force and Effect; Conflicts. Except as expressly set forth in this Second Amendment, all terms, conditions, and provisions of the Housing Agreement shall remain in full force and effect. If there is a conflict between the provisions of this Second Amendment and the provisions of the Housing Agreement, the provisions of this Second Amendment shall control. 7. Execution in Counterparts. This Second Amendment may be executed in several counterparts, and all so executed shall constitute one agreement binding on both parties hereto, notwithstanding that both parties are not signatories to the original or the same counterpart. [signatures on next page] 538/015610-0040 485158.02 a03/31/04 —2— IN WITNESS WHEREOF, Agency and Participant have entered into this Second Amendment as of the date first written above. ATTEST: Agency Secretary APPROVED AS TO FORM: RUTAN & TUCKER, LLP Attorneys for the La Quinta Redevelopment Agency "AGENCY" LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic I' , Executive Director "PARTICIPANT" MAUKA VIEW, LLC, a California limited liability company By: James S. Sorenson, on behalf of the Sorenson Family 2001 Revocable Trust, Member 538/015610-0040 485158.02 a03/31/04 -3- ATTACHMENT NO.3 ALLONGE TO NOTE [Attached] 538/015610-004091 485158.02 a03/31/04 ~ ALLONGE TO NOTE This ALLONGE TO NOTE ("Allonge") is affixed to and forms a part of that certain Note dated September 13, 2001, in the original principal amount of Three Hundred Fifty Thousand Dollars ($350,000) ("Note"), issued by La Quinta 34 LLC, a California limited liability company ("Original Maker"), whose interest under the Note was assigned to Mauka View, LLC, a California limited liability company ("Maker"), effective as of the Effective Date, and payable to the La Quinta Redevelopment Agency ("Agency"). Effective on , 2004 ("Effective Date"), the Note is hereby endorsed and modified as follows: (a) All references in the Note to "Agency Deed of Trust" shall mean and refer to the Agency Deed of Trust, as amended by that certain Modification of Deed of Trust between Agency and Maker recorded on or about the Effective Date. (b) The Note provides for simple interest to accrue on the outstanding principal amount of the Loan at seven percent (7%) per annum, compounded annually. Interest for the period prior to the Effective Date shall be at the rate set forth in THE preceding sentence. From and after the Effective Date, simple interest shall accrue on the outstanding principal amount of the Loan at five percent (5%) per annum, compounded annually. Except as expressly modified by this Allonge to Note, the Note shall remain unmodified and in full force and effect. [signatures on next page] 538/015610-0040 485158.02 a03/31/04 -1- IN WITNESS WHEREOF, this Allonge to Note has been executed as of this day of 102004. "MAKER" MAUKA VIEW, LLC, a California limited liability company 0 James S. Sorenson, on behalf of the Sorenson Family 2001 Revocable Trust, Member "AGENCY" LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic Lo Executive Director ATTEST: Agency Secretary APPROVED AS TO FORM: RUTAN & TUCKER, LLP Attorneys for the La Quints Redevelopment Agency 538/015610-0040 485158.02 a03/31/04 -2- 8 23 4. ATTACHMENT NO.4 MODIFICATION OF DEED OF TRUST [Attached] 538/015610-0040 485158.02 a03/31/04 24 RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: La Quinta Redevelopment Agency 78-495 Calle Tampico La Quinta, California 92253 Attention: Executive Director (Space Above For Recorder's Use) This Modification of Deed of Trust is recorded at the request and for the benefit of the La Quinta Redevelopment Agency and is exempt from the payment of a recording fee pursuant to Government Code Section 27383. MODIFICATION OF DEED OF TRUST This MODIFICATION OF DEED OF TRUST ("Modification") is dated as of , 2004, and made by and between the LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic (`Beneficiary"), and MAUKA VIEW, LLC, a California limited liability company ("Trustor"). RECITALS A. Trustor's predecessor executed that certain Deed of Trust With Assignment of Rents and Rider Attached Hereto dated September 13, 2001, in favor of Orange Coast Title, as Trustee, and Beneficiary, as the beneficiary thereunder, recorded on September 28, 2002, as Instrument No. 2001-474253 in the Official Records of Riverside County, California ("Deed of Trust"). Pursuant to the Deed of Trust, Trustor granted to the Trustee, for the benefit of Beneficiary, certain real property more particularly described in the Deed of Trust and on Exhibit "A" attached hereto ("Property"). B. Trustor and Beneficiary now desire to amend the Deed of Trust as more particularly described herein. NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto agree as follows: 1. Modification to Note. The Note secured by this Deed of Trust has concurrently herewith been modified to reduce the rate of interest payable as more particularly provided in the Allonge to Note dated on or about the date hereof. 2. No Other Modification. Except as expressly modified by this Modification, the Deed of Trust shall remain unmodified and in full force and effect. 30 538/015610-0040 485158.02 a03/31 /04 -1— �.► IN WITNESS WHEREOF, the parties have executed this Modification as of the date set forth above. ATTEST: Agency Secretary APPROVED AS TO FORM: RUTAN & TUCKER, LLP Attorneys for the La Quinta Redevelopment Agency "BENEFICIARY" LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic Executive Director "TRUSTOR" MAUKA VIEW, LLC, a California limited liability company LIM James S. Sorenson, on behalf of the Sorenson Family 2001 Revocable Trust, Member 538/015610-0040 _2_ 485158.02 a03/31/04 STATE OF CALIFORNIA ) ss. COUNTY OF ) On , 2004, before me, a notary public in and for said state, personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacities, and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. Witness my hand and official seal. Notary Public [SEAL] STATE OF CALIFORNIA ) ss. COUNTY OF ) On , 2004, before me, a notary public in and for said state, personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacities, and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. Witness my hand and official seal. Notary Public [SEAL] 538/015610-0040 7 485158.02 a03/31/04 -3- ow EXHIBIT "A" TO MODIFICATION OF DEED OF TRUST LEGAL DESCRIPTION OF PROPERTY All that certain property located in the City of La Quinta, County of Riverside, State of California, described as follows: LOTS 1 TO 11 INCLUSIVE IN BLOCK 126 OF SANTA CARMELITA AT VALE LA QUINTA, UNIT NO. 14, IN THE CITY OF LA QUINTA, COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 18 PAGES 82 AND 83 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. EXCEPTION THEREFROM THOSE PORTIONS OF LOTS 1, 5, 6 AND 115, DEEDED TO THE COUNTY OF RIVERSIDE, BY DOCUMENTS RECORDED MARCH 23, 1978 AS INSTRUMENT NOS. 55038 AND 55039 OF OFFICIAL RECORDS OF RIVERSIDE COUNTY, CALIFORNIA. LOTS 6 AND 7 IN BLOCK 125 OF SANTA CARMELITA AT VALE LA QUINTA UNIT NO. 143, AS SHOWN BY MAP RECORDED IN BOOK 18, PAGE 82 OF MAPS, RECORDS OF RIVERSIDE COUNTY, CALIFORNIA. �3 538/015610-0040 485158.02 a03/31/04 Q ceit�t 4 aCP QumrAo COUNCIL/RDA MEETING DATE: April 6, 2004 ITEM TITLE: Consideration of Initial Branding Process for SilverRock Resort RECOMMENDATION: AGENDA CATEGORY: BUSINESS SESSION:' CONSENT CALENDAR: STUDY SESSION: PUBLIC HEARING: As deemed appropriate by the Redevelopment Agency Board. FISCAL IMPLICATIONS: None. BACKGROUND AND OVERVIEW: On February 17, 2004, the Redevelopment Agency considered an item related to the branding process for SilverRock Resort. As the Agency was advised, McMurry, the marketing firm for SilverRock, retained the expertise of Mr. Duane Knapp, author of The BrandMindset, to lead the brand development effort. Stephen Williams of McMurry presented Mr. Knapp's tried and tested five -step plan (Attachment 1) to the Agency, indicating that the first four steps would be employed to develop a genuine and unique brand for SilverRock Resort. McMurry and Mr. Knapp intend to move forward with the initial phase of this branding effort beginning with the first step, Brand Assessment (Attachment 2). This initial effort involves conducting creative sessions with key stakeholders of SilverRock Resort. The goal is to articulate in writing a Brand Promise for SilverRock Resort utilizing the thoughts and sentiments gathered at these meetings (Attachment 3 provides more detail on the development of a Brand Promise) . The first creative session is proposed for Friday, April 16, 2004 in the Session Room at City Hall. A representative from McMurry and Mr. Knapp will be available to guide the Agency through this initial phase and to help answer any questions. 24 FINDINGS AND ALTERNATIVES: The alternatives available to the Redevelopment Agency Board include: 1. Approve the initial step of the branding process for SilverRock Resort; or 2. Approve the initial step of the branding process for SilverRock Resort with changes; or 3. Do not approve the initial step of the branding process for SilverRock Resort; or 4. Provide staff with alternative direction. Respectfully submitted, Mark Weiss, Assistant Executive Director Approved for submission by: ell < Thomas P. Genovese, Executive Director Attachments: 1. SilverRock Ranch Brand Development Process 2. SilverRock Resort Brand Development Process, Initial Phase 3. Developing a BrandPromise® Commitment for SilverRock Resort 2 V Attachment 1 SilverRock Ranch Brand Development Process McMurry, Inc. has retained Duane Knapp and his company Brand Strategy, Inc to facilitate the development of the SilverRock Ranch BrandPromise® Commitment (Promise). Duane will employ the first four steps of his tried and tested five -step plan to develop a genuine, unique SilverRock Ranch brand. The fifth step, Brand Advantage cannot be facilitated until SilverRock Ranch is an ongoing, viable entity serving real customers. Step five is therefore not within the scope of this initial engagement. The basic steps are as follows: 1.) Brand Assessment In this initial phase, Duane and McMurry will conduct "inspirational" research meetings with key stakeholders including but not limited to representatives from the La Quinta RDA, GMA, Palmer Course Design, Landmark... This constituent committee, under Duane's tutelage will develop a consensus regarding the SilverRock Ranch brand position. Ideally, the constituent "interviews" and discussions will be held in a collective, live workshop. If critical constituents are not available for the group meeting(s), their input will be sought through telephonic interviews. A review of the brand experience as delivered by locally, competitive properties will be included. 2.) Brand Promise What should the SilverRock Ranch's Promise be? A distillation of the collective thoughts and discussions derived from the first Brand Assessment meeting will be articulated in a written definition of the Promise from the customer's perspective. The Promise is the foundation from which the brand principals are developed. 3.) Brand Blueprint How will the brand be communicated to the myriad SilverRock Ranch audiences? Duane will advise McMurry in developing a blueprint to chart the path to effectively create, design and communicate the intended brand perception. It will signal what SilverRock Ranch will deliver in its golf course product, services, attitude and internal culture. 4.) Brand Culturalization In essence, Duane will identify how every SilverRock Ranch employee must understand and adopt the Brand Promise. Each and every SilverRock Ranch employee and associate must understand and adopt the Promise and the Promise must be an integral part of the SilverRock Ranch culture and must drive every related decision. Culturalization will occur as a result of consistent, persistent and passionate training of all SilverRock Ranch staff and associates. To this end, Landmark plays a 3 critical role as they are the primary on -site management. As a key constituent throughout the branding process, Landmark will be an integral and essential brand partner. How long will this entire branding process take? The four steps of the process as identified herein will take approximately two months and will require at least two constituent meetings and numerous telephonic interviews. As soon as the list of participatory constituents is agreed to, the first Brand Assessment meeting can be scheduled and the process evolves from there. It should be understood that the fourth step, Brand Culturalization is ostensibly never completed as training must be continual, not only to ensure effective Brand Culturalization amongst new hires but to ensure that standards are maintained across all existing staff. Next Steps? In co-operation with the La Quinta RDA, McMurry and Duane Knapp we will identify the key constituent entities and who specifically within those entities should serve as a valued representative on the branding committee. 4 Attachment 2 SilverRock Resort Brand Development Process, Initial Phase As per the previous document on this subject, the development of the SilverRock Resort Brand Promise will follow the first four steps of Duane Knapp's Brand Strategy Inc. tried and tested five step process. The first and initial Brand Assessment phase will be conducted in a live session held in the Session Room at La Quinta City Hall on Friday, April 16, 2004. A suggested list of key stakeholders to be included in this initial assessment is detailed below —single or multiple representatives from these entities are acceptable. In this initial phase, Duane Knapp will lead the group by asking a series of inspirational, thought - provoking questions specifically designed to illicit identification of the core brand position as deemed critical by each participating stakeholder. Through continued discussion and debate, what initially will be a varied and possibly conflicting articulation of the desired brand promise will be distilled to a concentrated and unilaterally agreed upon consensus. Although it is preferable that all constituents attend a "live" session, if this is not possible, the session can be augmented by telephonic interviews with non -attendees. The distillation or collective thoughts derived from phase one of the process will be made available by Duane Knapp and will form the Brand Promise as detailed in phase two of the process. Preliminary list of SilverRock Resort branding constituents and stakeholders: La Quinta Redevelopment Agency/City Council City of La Quinta representative(s) SRR Project Management (including Mark Weiss and Roy Stephenson) GMA International Landmark McMurry, Inc. Brand Strategy Palmer Course Design Attachment 3 DEVELOPING A BRANDPROMISE® COMMITMENT FOR SILVERROCK RESORT Thinking like a brand requires a different mindset, perspective and approach than just business as usual. The BrandPromise® Commitment is the key to this different approach and is absolutely fundamental to creating a Genuine Brand Image for SilverRock Resort. A BrandPromise (promise) communicates three inherent attributes: • something will be done A there is an expressed assurance A a perception of distinctiveness and excellence A promise is written to define the intended functional and emotional benefits from the customer's point of view after experiencing SilverRock Resort. Because it incorporates the customer's viewpoint, a promise is distinctly different from a business's mission or vision statement. The promise represents SilverRock Resort's commitment to its guests and how it wants them to feel. Creating a successful marketing strategy for SilverRock requires a discipline that is focused on a BrandPromise Commitment that will create a distinctive and valued perception that results in "preference" or "insistence" that is much more desirable than other competing golf developments. BrandPromise Methodology The promise should serve as the "guiding star" for everything SilverRock Resort becomes. Its primary purpose is to communicate clearly what the brand stands for to every stakeholder (guests, employees, agents, representatives, etc.). Developing a BrandPromise® Commitment BrandStrategy, Inc. will facilitate two BrandPromise creative sessions which will focus on answering three primary questions in order to develop an effective promise: A What is our brand experience? A What differentiates our products and services from competitors? • What is superior about the value we offer our guests? Guests will develop their perception of value through a subjective feeling as a result of comparing the brand's products and service offerings with those of its competitors based on his or her own needs, preferences, buying behavior, and characteristics. Thus, guests' perceptions of value constantly change. Consequently, SilverRock's ability to deliver "exceptional experiences" for its guests is deeply rooted in the promise. Genuine Brands make a promise and they deliver on that promise consistently, eagerly; and at the guest's convenience. BrandMindset®, BrandPromise®, and BrandStrategyTm are trademarks of BrandStrategy, Inc. All other trademarks are the property of their respective companies. Additionally, other easily recognizable brands and brand names are used for illustrative purposes and are not associated with BrandStrategy, Inc. A J a i> i to G e n a i n a D r u u J 2415 T Avenue, Suite 210 Anacortes, WA 98221 Phone 360.293.8810 Fax 360.293.8811 Email dknapp@brandstrategy.com ^ (� 4 sepQul�c1u. COUNCIL/RDA MEETING DATE: April 6, 2004 ITEM TITLE: Consideration of Logos for SilverRock Resort RECOMMENDATION: AGENDA CATEGORY: BUSINESS SESSION: CONSENT CALENDAR: STUDY SESSION: PUBLIC HEARING: As deemed appropriate by the Redevelopment Agency Board. FISCAL IMPLICATIONS: None. BACKGROUND AND OVERVIEW: One of the tasks currently being undertaken by McMurry, Inc., the marketing firm for SilverRock Resort, is development of a logo. McMurry first presented the Redevelopment Agency with a set of logo images on January 6, 2004 during a study. session. The Agency reviewed the images and engaged in a constructive discussion, yet no single image seemed to capture the Agency's vision for SilverRock. Therefore, the Agency directed McMurry to move forward to the next phase of development. They asked McMurry to examine the spring 2003 submission more closely and incorporate La Quinta's natural features more prominently. Subsequently, McMurry submitted a second round of logo images, which were considered by the Agency on February 17, 2004. The images were submitted in black and white and, as directed by the Agency, more of them incorporated the sun and mountains. McMurry recommended narrowing the selection to two or three images before exploring a color palette. After some discussion, the Agency selected four logo images for continued exploration and color application, and directed McMurry to design two new logos for consideration during the next cycle. On March 16, 2004, the Agency considered a third submission from McMurry, which contained 12 logo images. Color applications were incorporated and appeared in 40 variations, depending on the logo. After consideration of each image, the Agency selected three marks for further consideration, including one script (Attachment 1). McMurry was to explore a new font for the script, and place the marks on merchandise to help visualize the actual transfer from paper to product. McMurry's Latest work, which includes a cover letter as well as new and returning logos, is represented in Attachment 2. A representative from McMurry will be available to provide an explanation on this logo submittal and present a sampling of SilverRock merchandise. McMurry hopes a preferred image for SilverRock Resort can be selected during this meeting in order to facilitate the implementation of other marketing efforts. FINDINGS AND ALTERNATIVES: The alternatives available to the Redevelopment Agency Board include: 1. Approve the selection of a logo for SilverRock Resort; or 2. Approve the selection of a logo for SilverRock Resort with changes; or 3. Do not approve the selection of a logo for SilverRock Resort; or 4. Provide staff with alternative direction. Respectfully submitted, Mark Weiss, Assistant Executive Director Approved for submission by: s homas P. Genovese, Executive Director Attachments: 1. Three Returning Logos for SilverRock Resort (black/white) 2. McMurry Cover Letter and Latest Logo Submittal (black/white) 412 Attachment 1 x V z 42 3 4 43 Attachment 2 Client: City of La Quinta Project: SilverRock Item: Logo development — discussion points Please find herein, brief discussion points relative to the 7 logos that form a part of the staff report for the RDA session to be held on Tuesday, April 6/04. For the benefit of clarity, I will address each logo in the order in which they appear in this report. We have brought forth two logos (graphic element with type) virtually unchanged from the prior submission, adjusted one of these to address concerns raised by Landmark Golf Company, created a new logo (graphic element with type that was inspired by a prior submission) and explored three pure type logos (no graphic element). McMurry firmly believes that a development of distinction should be represented by more than a type -only logo. If a substantial, distinguished "mark" or graphic element accompanies the type, the two can be utilized as a single combined element as well as be potentially separated for independent use depending upon application specific requirements. A graphic mark is also considerably more memorable, significantly enhancing brand equity over time. Landmark Golf Company is confidant that a type -only logo is sufficient and in recognizing their potential, significant involvement in the project as the golf course operator; we have also explored a range of type -only logos. Logo #1 (Mountains between two horizontal bars) This logo is a perennial pleaser brought forth at the request of the RDA. Originally created in the late spring of 2003 and surviving with almost no modification, the only adjustment since the last session is a refinement of the color which is now incorporated on the upper and lower bars which are also detached from the body element. Logo #2 (Stylized SR) This logo is brought forth at the request of the RDA and is without modification save for a tightening of the space between the two R's so as to reinforce that SilverRock is a single word. Logo #3 (New version of Stylized SR) McMurry created a new version of logo #2 to answer concerns that the original might appear too feminine and may also not have sufficient clarity and impact in an embroidered application. The body of the mark is thickened, the top of the "S" is wrapped and a seraph treatment extended to the tail of the element to outline the "R" more substantially. Logo #4 (Type -only with a golf ball, tee element incorporated) This is a new logo, created to address requests from both the RDA and Landmark Golf Company for a type -only logo. The font is contemporary with a deliberate play between the two R's. To reinforce that the development is primarily golf oriented, we have 45, included a golf ball and golf tee element with the letter "O" in Rock. Of the three type - only logos, McMurry much prefers this one. Logo #5 (Type -only with shadow) This logo is new but is substantially influenced by the previous submission from the Landmark Golf Company. As a type -only logo, it is clear, easily read and will apply well to all mediums. Unfortunately it also lacks the distinctive elegance that a world class, destination resort needs. Logo #6 (Type -only in a forward moving font) This type -only logo is also new and submitted to offer variety. Although the forward motion of the font is interesting, it is our opinion that, again, it is not appropriate for this distinctive application. Logo #7 (Stylized SR within a box with same font -type beneath) This logo is similar to one previously submitted and favorably reviewed by the RDA. We have made a few significant adjustments as follows; the second "R" has been removed and the highly stylized and extremely elegant "SR" is now encased within a bold box. This answers concerns that the previous version might have been too insubstantial to be embroidered and retain impact. The font also works well when the type is removed from the graphic element. McMurry will be prepared to present these logos on merchandise to help the Agency visualize the transfer of these marks from paper to actual products (e.g., shirts, caps). 46 7 47 8 LVE KF, 0 C K 43 S1LVEI�ROCK S%LVEI���CI�. 11 rRock� / J J 2 f 1'i�c�����ocf{ r� 14 011 OF 'I9 COUNCIL/RDA MEETING DATE: April 6, 2004 ITEM TITLE: Consideration of Modifications to the Conceptual Master Plan for SilverRock Resort RECOMMENDATION: AGENDA CATEGORY: BUSINESS SESSION: CONSENT CALENDAR: STUDY SESSION: PUBLIC HEARING: Adopt a resolution of the Redevelopment Agency approving the revised Conceptual Master Plan for SilverRock Resort. FISCAL IMPLICATIONS: None for this action. BACKGROUND AND OVERVIEW: On May 6, 2003, the Redevelopment Agency adopted Resolution Number RA 2003- 08, approving the Conceptual Master Plan for SilverRock Resort (Attachment 1). On May 30, 2003, the Agency retained Palmer Course Design Company to design the tournament golf course adjacent to the mountains. The golf course design has been completed, and the final design has produced several changes to the master plan. The adopted master plan had the tournament golf course at 7,210 yards; however, in response to concerns that the course be large enough to accommodate today's players, the final golf course design has 7,548 yards (par 72). The golf course design has changed the location and configuration of the casitas/residence club areas. The original master plan had three casitas/residence club pads totaling 20 acres, all located within the southeast quadrant of the property. The new plan has a 13-acre casitas/residence club pad located within the golf course, which greatly increases the value of this property given the spectacular views of both v� the mountains and golf course. In addition, there are still three casitas areas located in the southerly section of the property, including an 1 1-acre parcel, a 16.5-acre parcel, and a 6.5-acre parcel. In summary, the marketable casitas/residence club acreage has increased from a total of 20 acres to a total of 47 acres. The placement of casitas acreage within the golf course envelope, coupled with the reconfiguration/increased yardage of the golf holes by Palmer Design, has moved the "clubhouse road" off Avenue 52 to the northeast. This, in turn, has necessitated rerouting the second golf course and shifting the practice range slightly east. In order to create a "world -class" golf facility, a short game practice area has been added adjacent to the practice range. The short game practice area will allow for golf instruction, and is strongly recommended by Landmark Golf Management. Because of the changes to the practice range, the configuration of the 45-acre. "optional park, golf, civic use" area has been altered. The parcel at the northeast corner of the property is now 37 acres in size, and an additional eight acres of open space has been captured in a triangular configuration just south of the canal adjacent to Jefferson Street. A bridge will be required for access between the two parcels. The placement of lakes/water features has also changed; however, PACE Engineering (the Agency's water/lakes engineer) has confirmed that the overall project still conforms to the water management plan. The final design of the village lake has increased the resort/retail pad from 10 acres to 1 1.5 acres and the boutique hotel pad from 5.5 acres to 10 acres. Finally, the overall configuration of the maintenance facility at Avenue 54 has changed due to input from the golf course operator; the original master plan allocated 2.5 acres, but it has increased slightly to 3 acres. This will allow for more efficient service to both golf courses. GMA International will also present an overlay to the master plan which shows the proposed golf cart/pedestrian tunnel under Avenue 52 from the Watermark Villas. There is a concern with the tunnel grade, shown at 15 % by Watermark Villas' developer, as being too steep for optimal golf cart use. However, a lesser grade will require more land. GMA is prepared to discuss this issue with the Agency Board. 2 %5 FINDINGS AND ALTERNATIVES: The alternatives available to the Agency Board include: 1. Adopt a resolution of the Redevelopment Agency approving the revised Conceptual Master Plan for SilverRock Resort; or 2. Do not adopt a resolution of the Redevelopment Agency approving the revised Conceptual Master Plan for SilverRock Resort; or 3. Provide staff with alternative direction. Respectfully submitted, �— I\- a.-- .. Mark Weiss, Assistant Executive Director Approved for submission by: Thomas P. Genovese, Executive Director Attachments: 1. Original Conceptual Master Plan 2. Revised Conceptual Master Plan 3 Resolution No. RA 2004- SilverRock Resort Adopted: Page 4 RESOLUTION NO. RA 2004- A RESOLUTION OF THE LA QUINTA REDEVELOPMENT AGENCY OF THE CITY OF LA QUINTA, CALIFORNIA, APPROVING THE REVISED CONCEPTUAL MASTER PLAN FOR SILVERROCK RESORT WHEREAS, on May 6, 2003, the La Quinta Redevelopment Agency (Agency) adopted Resolution No. RA 2003-08, approving the Conceptual Master Plan prepared by GMA International; and WHEREAS, on May 30, 2003, the Agency selected Palmer Course Design Company as golf course architect for the Phase 1 touTnament-quality public golf course; and WHEREAS, the golf course design has been completed and this design has altered the approved Conceptual Master Plan; and WHEREAS, the potential for hosting a PGA golf tournament as well as other community events has accelerated Phase 3 development; and WHEREAS, the Agency finds the revised Conceptual Master Plan accurately reflects Agency and Community objectives for the property. NOW, THEREFORE, BE IT RESOLVED, by the La Quinta Redevelopment Agency of the City of La Quinta, as follows: 1. Approves the revised conceptual master plan for SilverRock Resort. PASSED, APPROVED and ADOPTED at a regular meeting of the La Quinta Redevelopment Agency held on this 61h day of April, 2004, by the following vote to wit: AYES: NOES: ABSENT: ABSTAIN: 4 v� Resolution No. RA 2004- SilverRock Resort Adopted: Page 5 TERRY HENDERSON, Chairperson City of La Quinta, California ATTEST: JUNE S. GREEK, CMC, Agency Secretary City of La Quinta, California (City Seal) APPROVED AS TO FORM: M. KATHERINE JENSON, Agency Counsel City of La Quinta, California 5-$ v - v I�t r �.•✓� ..ram � �s. ssr+'- .,'. - �' - - _.� Trall ` P OL N17, vr C z IPA 7 © k, ' O % `1,.�, ✓ .nt , .fF1 ➢1��..J.AL�� .�, - r � � x LL q�j . �° ,: Ord- ► '' ` �.�_,� # ;�'e", y, �� � �• ' � 'JE`tT +� �.•�' -� � Y`�J .�L.i�,m -�� �� ..a'`'P.+a''.''d -�IY[:v�~ .fi Y� AJ r ..�i �� _ Y4ri.. y 1'S`'rv� y.$►;;'.+� J' ,.9 �jsa _' ��.'� � e' spa• �t �.'S1 � � Ord yr�r d'�'� ` J �_-�.. "`.�. � m �_..,.d t •,fir , 6 rr", `.w .♦,t a' a` 1u y�.tii� '� t.a 4� 'Y�� a �j..�F �, f��'��t i � '�, � C�'Y 4< < � �� � � Fu.�� a �- M 'ai �+ i7 s. dd ;�y '`.•"Y' `,�.� �y� L.'�C'�.l 1 '= q ►-6!,� "''^mayINAN �..P C co • fir'-%JnF..r ' yi .."'s"ts.-'{ _�}y�fl ?'° - - 5 At j g :r 4`X ^�ea.,z' •�. �1 .k _ , Oa�.rte,a A. 4^1 � r 70 c} "�Zy6 sr''J V_-t 4A A.rt�yr'J'^ fr�•i 5i��'Y �a. `�'tt �`J�YJ11� }���� � '�,1�� �. � �`,♦��'1 q. '.:- ��© ,�� � ;�F� , Jo Ile 1"s Fr9� >°YI 4 .,h� i.' Ss.$. , l � ' P -p/' . tar "1•.'. ',yam .k � �� � k r ,p�,�`� t r :.#� � ;, '� *ell' �". � " � t � --� � .. ' r j -• ° `y, ' �..t �� q' D �, � ,�. . �a `nPi.� '� � 1'. ATTACHMENT 2 7 60 ox C4J ts OF �ti COUNCIL/RDA MEETING DATE: April 6, 2004 ITEM TITLE: Discussion of La Quinta Arts Foundation Request for Use of the SilverRock Resort Property for the Arts Festival RECOMMENDATION: As deemed appropriate by the Redevelopment Agency. FISCAL IMPLICATIONS: AGENDA CATEGORY: BUSINESS SESSION: CONSENT CALENDAR: STUDY SESSION: PUBLIC HEARING: Options for temporary installation of turf for parking, soil stabilization and arts festival activities range from approximately $104,000 to $339,000 for installation plus annual maintenance costs (i.e., estimates ranging from $25,000 to $100,000 or more depending upon quality of maintenance preferred). BACKGROUND AND OVERVIEW: The La Quinta Arts Foundation submitted correspondence in December 2003 requesting use of the SilverRock driving range, or "an alternative suitable location" within the SilverRock Resort project for the 2005 Arts Festival. The City Council reviewed this correspondence at its meeting of January 20, 2004, and referred the matter to the Agency as a Study Session item. The Agency considered the matter at its regular meeting of February 3, 2004, and reviewed the following options: • Design/redesign the practice facility to accommodate Festival use; i • Expedite development of the optional park, golf and other uses area; 61 • Design and develop a temporary facility for the Foundation; • Lease acreage to the Arts Foundation and allow the Foundation to make specified interim improvements; and • Defer action on the Foundation's request until Phase II development occurs. The Agency expressed interest in the concept of developing a temporary facility and staff pledged to refine some conceptual designs to that end (see meeting minutes from February 3, 2004, Attachment 1). Staff conferred with representatives from David Evans and Associates and Western Turf in developing various temporary facility options for consideration. The options presented in Attachment 2 attempt to stabilize the entire "Optional Park, Golf, Civic Uses" area of SilverRock Resort to allow maximum flexibility for festival and other alternative parking uses.. 1. Option 1 assumes that the entire "Optional Park, Golf, Civic Uses" area is grassed with an underground irrigation system. This option provides a flat grassed area that can be used for multiple events. It has not been master planned for multiple uses, however, with landscaping or features (i.e., amphitheatre(s), etc.). Cost: Approximately $339,000 plus annual maintenance expense. 2. Option 2 provides turf on only 10 acres and assumes that 14 acres of parking could be stabilized with a polymer in an effective manner. The 10 acres of turf would have underground irrigation. Cost: Approximately $125,000 plus annual maintenance. 3. Option 3 provides a true "minimalist" approach for the entire "Optional Park, Golf Civic Uses" area. It assumes minimal grassing expenses in that the City may have a golf course operator under contract that could more easily expand golf course operations services to include seeding the park area at minimal expense. Irrigation would be provided via an above -ground system that would be installed and removed manually to accommodate events. Maintenance would be negotiated and included as part of the operator's contract. Current thought is that the City might consider installing a rye grass only that would accommodate events during the, season, but then die and "stabilize" the area until being over -seeded for the following year. Cost: Approximately $104,000 initially, followed by annual maintenance plus seeding costs, approximately $25,000 to $35,000. Um Each of the aforementioned options requires some level of additional master planning and traffic control and consideration. Even interim decision(s) made with respect to the "Optional Park, Golf, Civic Uses" area may impact long-term uses for the property. For example, access to the site for parking and/or events may require curb cuts, median cuts, and coordination with perimeter landscaping improvements and/or other access points (i.e., the Watermark Villas have proposed a golf cart tunnel under Avenue 52). It is estimated that curb and median cuts alone will add $100,000 to each of the aforementioned options. Strategically placed, however, these cuts may service the ultimate project design. Each option will require some level of maintenance that may be addressed as an extension of the contract with the golf course operator. And each option will necessarily impact and require some diversion of resources from SilverRock Phase I development activities. FINDINGS AND ALTERNATIVES: The alternatives available to the Agency include: 1. Discuss options for interim improvements to accommodate the La Quinta Arts Festival at SilverRock Resort and provide staff with any appropriate direction; or 2. Provide staff with alternative direction. Respectfully submitted, Mark Weiss, Assistant Executive Director Approved for submission by: Thomas P. Genovese, Executive Director Attachments: 1. February 3, 2004, Redevelopment Agency Meeting minutes 2. Site stabilization options 63 3 2. DISCUSSION REGARDING A LA QUINTA ARTS FOUNDATION REQUEST FOR USE OF SILVERROCK RANCH PROPERTY FOR THE ARTS FESTIVAL. Assistant Executive Director Weiss presented the staff report, and reviewed options to accommodate the Arts Foundation's request. Board Member Adolph suggested the possibility of. grading and planting grass on the 45 acres at the northeast corner of the site for the Arts Foundation to use. He also referenced the southeast corner 1hat.the Bob Hope Chrysler Classic uses for parking. Mr. Weiss noted the Bob Hope Chrysler Classic has been responsible for clearing and securing the parking area at an approximate cost of $30,000. He stated it may be possible to plant grass for the same amount but there would also be maintenance and water requirements. Another consideration may be to determine a more -permanent location if the area is made available to both the Arts Foundation and the Bob Hope Chrysler Classic. Board Member Adolph referenced the possibility of using some of the Arts Foundation funding for soil stabilization, and stated he is in favor of the Arts Foundation's request. Board Member Sniff spoke in support of developing the northeast corner for the Arts Festival and other events throughout the year, and stated he feels there may be multiple options for the property. If the Arts Foundation's escrow was closed, he would feel better about their ability to potentially participate in the development of the site in return for' a long-term lease of maybe .20 years. He pointed out if something can be worked out on the site it will give the Arts Foundation long term viability and a new beginning. He suggested developing the site in phases over several years and beginning now. Board Member Osborne stated he would support working something out to bring the Arts Festival to the project site on a permanent basis, as well as a share of cost with a long-term lease. However, he feels it may be too soon to discuss using the northeast corner since Phase 11 of the project is still to be determined. 64 Redevelopment Agency Minutes 7 February 3, 2004 Board Member Perkins stated he feels it's premature to make any kind of long-term commitment. He would like to support the Foundation but feels the City should be cautious until Phase II is determined. Chairperson Henderson agreed there has been significant discussions about potential uses for the northeast corner of the project, and noted it's a $3.6 million part of the overall project. She concurs it's too early to discuss long-range plans but feels it's unlikely the City will be looking to do anything with the property for the next two years. She supports making an effort to work out an agreement with the Arts Foundation and maybe -the Bob Hope Chrysler Classic, for use of the site, and indicated, she would hate to see the property vacant while the Arts Foundation struggles to find a site. She noted the Agency will not know what can be done or what the costs are until staff is directed to investigate it. Board Member Adolph noted the Arts Foundation is looking for a commitment on a site location for their 2005 Arts Festival. Chairperson Henderson stated she is ready to have staff bring something back for Agency to consider. Jim Parrish, President of .La Quinta Arts Foundation, stated they are willing to work with the City and the Bob Hope Chrysler Classic to find a way to make this work. Christi Salamone, Executive Director of . La Quinta Arts Foundation, stated she hopes the Agency will be able to make a commitment to do whatever it can to ensure that the Arts Festival stays in La Quinta. She commented on the importance of continuity for the event. Chairperson Henderson noted the Agency needs additional information on 'the financial involvement and whether or not the Arts Foundation and/or Bob Hope Chrysler Classic will be able to participate financially. Mr. Weiss stated the Agency will be asked to make a critical decision in two weeks that will relate to the scope of the project for the golf course. He added plans are being developed for -the village lake, hotel pads, an extensive entry statement on Avenue 52, and the golf course, and it may require moving a lot of dirt to the Phase II portion of the project, including the two areas in question. There are also budget challenges and staff will- be coming back with bid options that may scale the project back. If the decision is made to go forward as currently designed, dirt will be moved on the entire site and he is not 65 9 =Redevelopment Agency Minutes 8 February 3, 2004 sure how stabilized it will be, and if the project is scaled back the alternatives may change. Most likely the southeast corner will be needed for parking during the Bob Hope Chrysler Classic for one more year, and he feels it makes sense to do that in joint fashion with the Arts Festival. He advised staff will come back with a viable alternative by the first meeting in April but noted the budget will. depend on the needs of the Arts Foundation. CHAIR AND BOARD MEMBERS' ITEMS - None PUBLIC HEARINGS — None ADJOURNMENT There being no further business, it was moved by Board Members Adolph/Perkins to adjourn. Motion carried unanimously. Respectfully submitted, JUNE S. GREEK, Secretary City of La Quinta, California 6 ATTACHMENT 2 CITY OF IA QUINTA ARTS FOUNDATION INTERIM SITE OPTION NO. 1 (Grass w/underground irrigation) ITEM NO. DESCRIPTION QTY. UNIT UNIT PRICE EXTENDED PRICE 1 Mobilization 1 LS $ 10,000.00 $ 10,000.00 2 lCommercial Drive A oach 2 EA $ 5,000.00 $ 10,000.00 3 Furnish & Install Turf (42 Acres) w/ underground irrigation 1,829,520 SF $ 0.15 $ 274,428.00 SUB -TOTAL: 15% CONTINGENCY: TOTAL: $ 294,428.00 $ 44,164.20 $ 338,592.20 Note: the commercial driveway approach on Jefferson Street will also require a median cut to allow left turn access into the proposed interim parking lot. The improvements will require modification to the existing landscape and irrigation, as well as, modification to the median curb. The estimated costs for these improvements are not presented above. Based upon recent costs associated with similar improvements on Washington Street, the costs associated with the median modifications are estimated at $100,000. 6 ? CITY OF LA QUINTA ARTS FOUNDATION INTERIM SITE OPTION NO. 1 OPTION 1 GRASS AND OVER 42f IRRIGATION ACRES %m .U_11 o 1�0 blip I u ± 01 ...... - — —---_..T- - AVENUE az � se i . ';•.=. •� ..•.•.• �� .•.•.•.•.•.•.•.•.•COMMERCIAL•.•.•.•.•..• .... ......... DRIVEWAY •.•.•.•.•.• .•.•� . . . . ... ......... .•.~.•...• -.•.•..•.•.•.•.•.•.••-•-APPROACH •,•,-•--•,• •••,, . . . - . . . . . . . . . . . . . . . . . . . . . . • . . . . . . . . • • . • • • • • • • . • • • • . • • • • • • . . • • • . . . • • • • • p . • . . . . . . . . . . . . . . . . . . . • . . . • . . . . . . . . . . . . . . . . . . . . . . . . . . . .. • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • .•.•.•.•..•.•.-.•.•.•.•.•:•.•. '4 _ ACRES'•'•' ...... •:•.•.•.•.•� ............... . G 3 AND IRRIGATION . ..... '' ..•. .......... ...... ............... . ..... . .. ..... ............ .... ............... ...... ................................. . .... ......... ....................... ...... .... ........................ C011ERCIAL.• • . .... ... .................... .•. ............................ & DRIVEWAY : ... ........................ ....... ...................... APPROACH :.X ... .. ................ .... .. ..................... .. ... ALL AMERICAN CANAL: DEFT Tt POCKET MEDIAN MODIFICATION low 7_71 0 CITY OF LA QUINTA ARTS FOUNDATION INTERIM SITE OPTION NO.2 (Grass w/Stabilized Parking) ITEM NO. DESCRIPTION QTY. UNIT UNIT PRICE EXTENDED PRICE 1 Mobilization 1 LS $ 10,000.00 $ 10,000.00 2 Commercial Drive Approach 2 EA $ 5,000.00 $ 10,000.00 3 Furnish & Install Turf (10 Acres) w/underground irrigation 435,600 SF $ 0.15 $ 65,340.00 5 Stabilized Parkin Area (14 Acres) 14 AC $ 1,000.00 $ 14,000.00 6 Stabilizer for dust control (18 Acres) 18 AC $ 500.00 $ 9,000.00 SUB -TOTAL: 15% CONTINGENCY: TOTAL: $ 108,340.00 $ 16,251.00 $ 124,591.00 Note: the commercial driveway approach on Jefferson Street will also require a median cut to allow left turn access into the proposed interim parking lot. The improvements will require modification to the existing landscape and irrigation, as well as, modification to the median curb. The estimated costs for these improvements are not presented above. Based upon recent costs associated with similar improvements on Washington Street, the costs associated with the median modifications are estimated at $100,000. t m 1) 1 al [or., 1 CITY OF LA QUINTA ARTS FOUNDATION I*iTERIM SITE OPTION NO. 3 (Grass w/overhead irrigation) ITEM NO. DESCRIPTION QTY. UNIT UNIT PRICE EXTENDED PRICE 1 Mobilization 1 LS $ 10,000.00 $ 10,000.00 2 Commercial Drive Approach 2 EA $ 5,000.00 $ 10,000"00 3 Furnish & Install Turf Seed 42 Acres 1 LS $ 25,000.00 $ 25,000.00 4 Irrigation System(temporary aboveground) 1 LS $ 45,000.00 $ 45,000.00 SUB -TOTAL: 15% CONTINGENCY: TOTAL: $ 90,000.00 $ 13,500.00 $ 103,500.00 Note: 1. The commercial driveway approach on Jefferson Street will also require a median cut to allow left tam access into the proposed interim parking lot. The improvements will require modification to the existing landscape and irrigation, as well as, modification to the median curb. The estimated costs for these improvements are not presented above. Based upon recent costs associated with similar improvements on Washington Street, the costs associated with the median modifications are estimated at $100,000. 2. The estimated costs for installing grass seed are based upon information obtained from West Coast Turf during the March 15, 2004 meeting. 71� CITY OF LA QUINTA ARTS FOUNDATIOWINTERN SITE OPTION NO. 3 OPTION 4 GRASS SEED AND TEMPORARY IRRIGATION OVER 42f ACRES t I vri III U-11 0 1�) 6 4 L41 0 A �l a I AV az ... .... ......... COMMERCIAL ...... . . . . ... ......... ........ .. . . .... ......... DRIVEWAY •.•.•.•.•.• .•.•� . . ... ......... -•:•:•::•:•:-:-:-:-:-:•:•APPROACH :•::-::.- : •;•;•;-;•;• •;•;, ..... ..................... ... .. . . . . . . . . . - . • . . . . . . . . • J ......... .... 9,0 ..... ..... .... ................... . .. ......... ........-•...•••... .... PROPOSED . . . . :•;•;•;•; • • . . . . . . . . . . . . . . . • . . . . • . • . . . . . . . :•:•:•:•:•:•.•:•:•:;•;•:•:•:•:•:•:•:•:•:•:•:•:-:•:•:•;•:•:.:..�.•.:. PRACTICE . - .. ............ ..... - .. .................... ..� ., ............................ '•'•'•'•••••'•'•'•'•••••••'•�•'•'••••'.•.• RANt3E •'•'•'•'•'•'•••••'•�••••• .•.•.•�� : . . . . . . . . . . . • • . . . • . • . . . . . . . • . . . . . . . . . . . .... ............... .•.•.•.�..•.•.•.•.•.•--.-.•.•. ......... ... .............. ..... .. ............... ...... 4 ACRES'•'•'•'•'•'•'•'•`• '•'•'•'•••'� .... ... " .... ........... . ........ ...... ' ..... ' . " . G S AND IRRIGATION ..... .......... ...... .............. .. • ..... .............. ... ............... ...... .... ..... ............. .............. ...... ....... ..... ................. .... .. • . • ..o . . . . . . . . . t. • • • • • • . . . . . . . . . . .ow ,,.....,...,_._ ...... ......... ....:........................•........ ....................... . .... ........................ COMMERCIAL_ ... . .... 0........................IVEWAY -••.... .•.•.•• .... ............../�.... .•.•..•.•.•.•.•.•.•.•.•.•.•.•.•.�•..• -:-:-:-APPROACH:-:-:*' -•, ................ ... — _ ALL AMERICAN CANAL LEFT TM POCKET MEDIAN MODIFICATION ti O 0 of A If 4r COUNCIL/RDA MEETING DATE: April 6, 2004 ITEM TITLE: Joint Public Hearing Between the La Quinta City Council and Redevelopment Agency to Consider Adoption of a Resolution to Use Tax Increment Revenue From La Quinta Redevelopment Project Area No. 1 to Fund the Construction of a Library Facility to be Located on the Civic Center Campus RECOMMENDATION: AGENDA CATEGORY: BUSINESS SESSION: CONSENT CALENDAR: STUDY SESSION: PUBLIC HEARING: Adopt a Resolution of the Redevelopment Agency approving the use of up to $4,300,000 of La Quinta Redevelopment Project Area No. 1 tax increment revenue to construct a library facility that will be owned by the City of La Quinta, and making certain findings thereto. FISCAL IMPLICATIONS: Approving this action will facilitate the use of up to $4,300,000 of Project Area No. 1 tax increment revenue. This expenditure has been programmed into the City's Capital Improvement Program and in the Redevelopment Agency's five-year cash flow programming. BACKGROUND AND OVERVIEW: r The City is moving forward with the construction of a 20,000 square foot municipal library on the Civic Center Campus. While this project is included in the City's Development Impact Fee Program, sufficient funds are not available at this time to facilitate the construction time frame. To achieve the construction schedule, the City will be requesting that the Agency fund up to $4,300,000 of the construction costs using Project Area No. 1 tax increment revenue. It is anticipated that the loan agreement will be presented for the Agency Board's consideration at the next Agency meeting. The California Community Redevelopment Law provides that the Redevelopment Agency may fund public facilities that benefit a project area if certain findings are made. This action authorizes the Agency to fund this public facility and presents the findings required by the Redevelopment Law. 73 Attachment 1 presents a Summary Report that addresses the requirements of the Redevelopment Law and reviews the following: • The amount of tax increment revenue proposed to be used to acquire land and pay for the construction of any publicly -owned building, including interest payments. • An explanation of why the buildings, facilities, structures, or other improvements are of benefit to the project area or the immediate neighborhood in which the project is located. • An explanation as to why no other reasonable means of financing the buildings, facilities, structures, or other improvements, are available to the community. • How the expenditure of tax increment revenue for the acquisition of land or the cost of buildings, facilities, structures, or other improvements will assist in the elimination of one or more blighting conditions inside the project area or provide housing for low- or moderate -income persons, and is consistent with the implementation plan adopted pursuant to Section 33490. • Describes the redevelopment purpose for which the tax increment revenue is being used to pay for the land and construction of such publicly -owned building. The- library will be located in La Quinta Redevelopment Project Area No. 1. When Project Area No. 1 was established in 1983, the lack of cultural and recreation facilities was cited as one of the blighting conditions that warranted redevelopment to rectify. Further, the Redevelopment Plan for Project Area No. 1 identifies constructing new public facilities as a redevelopment implementation goal. Agency funding of the library facility improvements will address a blighting condition while implementing a redevelopment goal. Further, Agency funding for this improvement has been scheduled in the City/Agency Capital Improvement Program, and has been included as part of the Agency's five-year expenditure program. This loan expenditure will be from tax increment revenue the Agency has reserved for this purpose. Notice A notice of public hearing was published in the Desert Sun on March 22"d and 29th, 2004, and the Summary Report was made available on March 22, 2004 in the Community Development Department at City Hall. FINDINGS AND ALTERNATIVES: The alternatives available to the Redevelopment Agency include: 1. Adopt a Resolution of the Redevelopment Agency approving the use of up to $4,300,000 of La Quinta Redevelopment Project Area No. 1 tax increment revenue to construct a library facility for that will be owned by the City of La Quinta, and making certain findings thereto; or 2. Do not adopt a Resolution of the Redevelopment Agency approving the use of up to $4,300,000 of La Quinta Redevelopment Project Area No. 1 tax increment revenue to construct a library facility for that will be owned by the City of La Quinta, and making certain findings thereto; or 3. Provide staff with alternative direction. Respectfully submitted, Tom Hartung Director of Building and Safety Approved for submission: *26 Thomas P. Genovese, Executive. Director Attachment: 1. Summary Report S:\CityMgr\STAFF REPORTS ONLY\PH 3 LibraryApprRDA.doc 03r RESOLUTION NO. RA 2004- A RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF LA QUINTA MAKING CERTAIN FINDINGS PURSUANT TO HEALTH AND SAFETY CODE SECTIONS 33445(a) AND 33679 AUTHORIZING THE EXPENDITURE OF FUNDS FOR CONSTRUCTION OF A MUNICIPAL LIBRARY WHEREAS, the Redevelopment Agency of the City of La Quinta ("Agency") is a public body, corporate and politic, organized and existing under the California Community Redevelopment Law (Health & Safety Code § 33000 et seq.); and WHEREAS, the California Community Redevelopment Law, at Health and Safety Code Section 33445, requires that before the Agency may pay for all or part of the value of the land for and the cost of the installation and construction of certain publicly owned improvements, the Agency and the City Council must adopt a resolution making certain findings; and WHEREAS, the need for cultural and recreational opportunities and facilities were documented as one of the conditions of blight that justified the formation of the La Quinta Redevelopment Project Area No. 1 ("Project Area"), as cited in the December 1983 Report to the La Quinta City Council on the Proposed Redevelopment Plan for La Quinta Redevelopment Project Area No. 1; and WHEREAS, the construction of a municipal library ("Library Project") would afford the Agency the opportunity to address some of the aforementioned conditions of blight; and WHEREAS, the Economic/Community Development Program component of the Agency's Implementation Plan prepared pursuant to Health and Safety Code Section 33490 lists a municipal library as a foreseeable and desired project; and WHEREAS, the Library Project will be located in La Quinta Redevelopment Project Area No. 1 (the "Project Area"); and WHEREAS, there is inadequate funding within the City's General Fund or from other sources to construct the Library Project; and WHEREAS, Section 518 of the Redevelopment Plan for La Quinta Redevelopment Project Area No. 1, as amended by Amendment No. 1, authorizes the Agency to undertake the funding of the civic and cultural facilities; and G:\WPDOCS\CCReso-COA\LibraryRDAReso.DOC tl 4 76 Resolution RA 2004- Library Health & Safety Code Findings Adopted: April 6, 2004 WHEREAS, the California Community Redevelopment Law, at Health and Safety Code Section 33679, further requires that if any of the publicly owned improvements to be funded with Agency funds is a publicly owned building, and the Agency's funds for such purpose are tax increment funds the Agency receives pursuant to Health and Safety Code Section 33670, the Agency and City Council must, prior to adopting the resolutions referred to in the preceding Recital, hold a duly noticed joint public hearing in connection with the proposed use of Agency funds for such purpose and in connection therewith have prepared a report summarizing (i) the estimated amounts of such tax increment funds to be used for such purpose, (ii) the facts supporting the findings required to be made pursuant to Health and Safety Code Section 33445 as referred to in the previous Recital, and (iii) setting forth the redevelopment purpose for which such funds are being used to pay for such purpose (the "Summary Report"); and WHEREAS, the Agency, in compliance with Health and Safety Code Section 33679, duly noticed a public hearing on the matter of the use of Agency funds for payment for the cost of the installation and construction of certain publicly owned improvements made part of the Library Project; and WHEREAS, the Summary Report was duly and timely prepared and made available for public review, inspection, and copying in compliance with Health and Safety Code Section 33679; and WHEREAS, on April 6, 2004, the Agency held its duly noticed public hearing on the Agency's payment for certain publicly owned improvements associated with the Library Project ("Public Hearing"); and WHEREAS, at the Public Hearing the Agency received and considered the staff report and such other information, testimony, and evidence as presented; and NOW, THEREFORE, BE IT RESOLVED, by the La Quinta Redevelopment Agency as follows: SECTION 1. The above recitations are true and correct and are adopted as the findings of the Agency Board. SECTION 2. The Agency Board hereby authorizes Agency funding up to $3.4 million to be utilized for the Library Project . SECTION 3. Pursuant to Health and Safety Code Section 33445(a), the Agency finds and determines that: G:\WPDOCS\CCReso-COA\LibraryRDAReso.DOC n,5 77 Resolution RA 2004- Library Health & Safety Code Findings Adopted: April 6, 2004 A. The Library Project will be located within the Project Area and thus will service the residents, businesses, property owners, and others located within the Project Area, as well at the City at -large. B. That no other reasonable means of financing the buildings, facilities, structures, and other improvements are available to the community other than Agency funding. In light of the current economic situation in the nation, State and locally, the continuing requirement for the City and Agency to provide contributions to the State, and that City general funds are already committed to expenditures for necessary police, fire, and other public safety purposes, recreational purposes, administrative, operations and maintenance purposes, and other previously identified capital improvements, Agency funding is the only available source of funds to the community for the Library Project. C. The Library Project will assist in the elimination of one or more blighting conditions by providing needed cultural and recreational opportunities and facilities within the Project Area as identified by the Economic Development/Community Development Program portion of the Agency's Implementation Plan. PASSED, APPROVED and ADOPTED at a regular meeting of the La Quinta Redevelopment Agency held on this 6th day of April, 2004, by the following vote: AYES: NOES: ABSENT: ABSTAIN: TERRY HENDERSON, Chair La Quinta Redevelopment Agency ATTEST: JUNE S. GREEK, CMC, Agency Secretary La Quinta Redevelopment Agency G:\WPDOCS\CCReso-COA\LibraryRDAReso.DOC n n � try Q . ! V Resolution RA 2004- Library Health & Safety Code Findings Adopted: April 6, 2004 APPROVED AS TO FORM: M. KATHERINE JENSON, Agency Counsel La Quinta Redevelopment Agency, California G:\WPDOCS\CCReso-COA\LibraryRDAReso.DOC � f 7 ATTACHWKT 1 SUMMARY REPORT FOR THE EXPENDITURE OF TAX INCREMENT REVENUE BY THE LA QUINTA REDEVELOPMENT ON A LIBRARY FOR THE CITY OF LA QUINTA PURSUANT TO HEALTH & SAFETY CODE SECTIONS 33445 AND 33679 The La Quinta Redevelopment Agency ("Agency") is the redevelopment agency activated by the City Council of the City of La Quinta ("City" or "City Council" as appropriate) pursuant to the California Community Redevelopment Law (Health & Safety Code § 33000 et seq.) ("CRL"). The Agency and City Council have scheduled a joint public hearing for April 6, 2004 to consider the Agency's use of up to $4,300,000 of La Quinta Redevelopment Project No. 1 tax increment revenue to fund construction of a library facility that will be owned by the City. Pursuant to Health and Safety Code Sections 33445 and 33679, whenever the Agency proposes to use tax increment funds to acquire land and/or to pay for the construction or installation of a publicly owned building, the Agency and City Council must hold a public hearing on the use of the tax increment funds for that purpose. At the conclusion of the public hearing, the Agency and City Council may adopt resolutions approving the use of Agency tax increment funds for that purpose. Prior to the public hearing, Health and Safety Code Section 33679 requires that the Agency prepare a summary report that: • Estimates the amount of tax increment revenue proposed to be used to acquire land and pay for the construction of any publicly owned building, including interest payments. • Provides an explanation of why the buildings, facilities, structures, or other improvements are of benefit to the project area or the immediate neighborhood in which the project is located. • Provides an explanation as to why no other reasonable means of financing the buildings, facilities, structures, or other improvements, are available to the community. • Describes how the expenditure of tax increment revenue for the acquisition of land or the cost of buildings, facilities, structures, or other improvements will assist in the elimination of one or more blighting conditions inside the project area or provide housing for low- or moderate -income persons, and is consistent with the implementation plan adopted pursuant to Section 33490. • Describes the redevelopment purpose for which the tax increment revenue is being used to pay for the land and construction of such publicly owned building. 394/017161-0001 08 391215.02 a03/22/04 30 BACKGROUND The City has been planning for the construction of a 20,000 square foot municipal library on the as part of the Civic Center Campus. Plans call for the library to be constructed in two phases. Phase 1 will entail building the 20,000sgare foot building shell of which 10,000 +/- square feet will be finished, furnished and equipped for use. The unfinished space will include rough wiring, lighting and dry wall improvements. This space will not be occupied until there is a need to expand library services. The site is located in the Civic Center campus which was purchased and improved in . The project will also entail modifying the existing parking lot to facilitate handicap parking and access by service vehicles. SUMMARY REPORT ITEMS • Estimates of the amount of tax increment revenue proposed to be used to acquire land and pay for the construction of any publicly owned building, including interest payments. The City estimates that the above described improvements could cost up to $5,639,500 to complete. Of this amount, the Agency proposes to fund $4,300,000 from Project No. 1 tax increment revenue. No bond proceeds are being used and as such, there will be no interest payments. • An explanation of why the buildings, facilities, structures, or other improvements are of benefit to the project area or the immediate neighborhood in which the project is located. The proposed library is located within the La Quinta Redevelopment Project Area No. 1 and thus services the residents, businesses, property owners, and others located within the Project Area, as well as the City at -large. The current library is also located in Project Area in leased facilities. Library operations are provided by the County of Riverside. • An explanation as to why no other reasonable means of financing the buildings, facilities, structures, or other improvements, are available to the community. In light of the current economic situation in the nation, State, and locally, the continuing requirement for the City and Agency to provide contributions to the State, and that City general funds are already committed to expenditures for necessary police, fire, and other public safety purposes, recreational purposes, administrative and operations and maintenance purposes, and other previously identified capital improvements, Agency funding is the only available source of funds to the community for the library. • A description as to how the expenditure of tax increment revenue for the acquisition of land or the cost of buildings, facilities, structures, or other improvements will assist in the elimination of one or more blighting conditions inside the project area or provide housing for low- or moderate -income persons, and is consistent with the implementation plan adopted pursuant to Section 33490. The library will assist in eliminating one or more blighting conditions within Project Area by expanding cultural and recreational opportunities and facilities for Project Area and City residents. This project is listed under the Economic Development/Community Development Program component of the Agency's July 1999 Implementation Plan pursuant to Section 33490. 394/017161-0001 _2- n981, 391215.02 a03/22/04 • Describe the redevelopment purpose for which the tax increment revenue is being used to pay for the land and construction of such publicly owned building. The Redevelopment Plan for Project No. 1 identifies improving public facilities as a redevelopment goal. Further, both the Agency's Report to City Council and the subsequent Implementation Plans identified the need to improve public facilities, and expanding cultural and recreation opportunities as a means to address blight within the Project Area. Using tax increment revenue to fund the library improvements works to implement the goal contained in the Redevelopment Plan, and address a condition of blight identified in both the Agency Report to Council and subsequent Implementation Plans. This Summary Report has been prepared in compliance with California Health and Safety Code Section 33679. A photocopy of this Report may be obtained from the Agency Secretary/City Clerk by paying the usual photocopy fee regularly charged by the Agency and City. 8 394/017161-0001 391215.02 a03/22/04 COUNCIL/RDA MEETING DATE: April 6, 2004 ITEM TITLE: Joint Public Hearing Between the La Quinta City Council and Redevelopment Agency to Consider Adoption of a Resolution for the Use of Tax Increment Revenue From La Quinta Redevelopment Project Area No. 1 to Fund the Construction of Certain Public Facilities Located at SilverRock Resort RECOMMENDATION: AGENDA CATEGORY: BUSINESS SESSION: CONSENT CALENDAR: STUDY SESSION: PUBLIC HEARING: oL Adopt a Resolution of the Redevelopment Agency approving the expenditure of up to $1 1,510,000 of proceeds from the La Quinta Redevelopment Project Area No. 1 Series 2002 Tax Exempt Bonds and the Series 2003 Taxable Bonds to fund the construction of part of the Phase 1 golf course improvements at SilverRock Resort, and making certain findings thereto. FISCAL IMPLICATIONS: This action will approve the expenditure of up to $1 1,510,000 in bond proceeds. The referenced bonds were sold to fund these projects, which are part of the City's Capital Improvement Program and in the Agency's five-year cash flow programming. BACKGROUND AND OVERVIEW: In May 2002, the City and Agency approved the purchase of 525 acres of land for the development of a golf resort. This action initiated master planning and golf course/driving range design activities during 2003, and approval, in March 2004, of contracts to build the first tournament quality golf course and related improvements. The Agency sold tax exempt and taxable tax allocation bonds to fund this effort. The Series 2002 Tax Exempt Bond proceeds will fund the public activity uses, and the Series 2003 Taxable Bond proceeds will fund the private activity uses that will be located at SilverRock Resort. Both of these uses include public facilities that will be transferred to the City of La Quinta upon completion. These facilities include temporary and permanent clubhouses, a maintenance building and yard, Phase 1 golf course restroom facilities, and the irrigation pump house building. G:\WPDOCS\CC Stf RP Iis\SRA ro RDA.doc PP P m The California Community Redevelopment Law provides that the Agency may fund public facilities that benefit a project area if certain findings are made. This action authorizes the Agency to fund these public facilities and presents the findings required by the Redevelopment Law. Attachment 1 presents a Summary Report that addresses the requirements of the Redevelopment Law and reviews the following: • The amount of tax increment revenue proposed to be used to acquire land and pay for the construction of any publicly -owned building, including interest payments. • An explanation of why the buildings, facilities, structures, or other improvements are of benefit to the project area or the immediate neighborhood in which the project -is located. • An explanation as to why no other reasonable means of financing the buildings, facilities, structures, or other improvements, is available to the community. • How the expenditure of tax increment revenue for the acquisition of land or the cost of buildings, facilities, structures, or other improvements will assist in the elimination of one or more blighting conditions inside the project area or provide housing for low- or moderate -income persons, and is consistent with the implementation plan adopted pursuant to Section 33490. • Describes the redevelopment purpose for which the tax increment revenue is being used to pay for the land and construction of such publicly -owned building. These public buildings and facilities will be located in La Quinta Redevelopment Project Area No. 1 which was established in December 1983. Two of the blighting conditions cited for establishing the Project Area were the lack of recreation facilities and the lack of enterprises that stimulate business activity: Constructing the Phase 1 golf course and these facilities at the SilverRock Resort will afford the opportunity to develop municipal/public golf and other passive recreation uses. Further, this will provide the Agency additional means to draw resort, hospitality, and related uses that will attract patrons to the Project Area, generating additional demand for Project Area businesses. The temporary clubhouse improvements entail restoring and improving the Ahmanson family ranch house. This building has been identified as a historic structure. The $1.4 million of improvements slated for this facility will restore the structure and facilitate public access and use. Once the permanent clubhouse is operational, these facilities will then be available for small conferences and community events. The permanent clubhouse is proposed to serve not only the needs of the two golf courses planned for S:\CityMgr\STAFF REPORTS ONLY\PH 4 SRappropRDA.doc the SilverRock Resort, but also to provide additional meeting space, restaurant and recreation facilities for Project Area residents as well as the greater community. The restrooms are needed to service the needs of the Phase 1 golf course patrons, while the maintenance building and yard, and the pump house building, will service the operations of the Phase 1 and 2 golf courses, and the park, trails, and rights -of -ways that will be developed for public use. Notice A notice of public hearing was published in the Desert Sun on March 23"d and 30", 2004, and the Summary Report was made available on March 22, 2004 in the Community Development Department at City Hall. FINDINGS AND ALTERNATIVES: The alternatives available to the Redevelopment Agency include: 1. Adopt a Resolution of the Redevelopment Agency approving the expenditure of up to $11,510,000 of proceeds from the La Quinta Redevelopment Project Area No. 1 Series 2002 Tax Exempt Bonds and the Series 2003 Taxable Bonds to fund the construction of a part of the Phase 1 golf course improvements at SilverRock Resort, and making certain findings thereto; or 2. Do not adopt a Resolution of the Redevelopment Agency approving the expenditure of up to $11,510,000 of proceeds from the La Quinta redevelopment Project Area No. 1 Series 2002 Tax Exempt Bonds and the Series 2003 Taxable Bonds to fund the construction of a part of the Phase 1 golf course improvements at SilverRock Resort, and making certain findings thereto; or 3. Provide staff with alternative direction. Respectfully submitted, vw 0 � QM,..... Mark Weiss Assistant Executive Director Approved for submission: Thomas P. Genovese, Executive Director Attachment: 1. Summary Report S:\CityMgr\STAFF REPORTS ONLY\PH 4 SRappropRDA.doc 853 RESOLUTION NO. RA 2004- A RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF LA QUINTA MAKING CERTAIN FINDINGS PURSUANT TO HEALTH AND SAFETY CODE SECTIONS 33445(a) AND 33679 AUTHORIZING THE EXPENDITURE OF FUNDS FOR CONSTRUCTION OF PUBLIC BUILDINGS AT THE MUNICIPAL GOLF COURSE WHEREAS, the Redevelopment Agency of the City of La Quinta ("Agency") is a public body, corporate and politic, organized and existing under the California Community Redevelopment Law (Health & Safety Code § 33000 et seq. ); and WHEREAS, on the 15th day of May, 2001, the City Council for the City of La Quinta ("City Council") approved the 2001-2002 Economic Development Plan which included implementation policies supporting economic diversification, business expansion, economic protection and preservation, and recreational opportunities; and WHEREAS, the California Community Redevelopment Law, at Health and Safety Code Section 33445, requires that before the Agency may pay for the cost of publicly owned improvements, the Agency and the City Council must adopt a resolution making certain findings; and WHEREAS, on 15th day of April, 2002 and again on the 21 st day of October, 2003, the Agency made findings pursuant to Health and Safety Code Section 33445 to approve the expenditure of tax increment funds the Agency receives pursuant to Health and Safety Code Section 33670 to fund all or part of the value of land for and the cost of the installation and construction of the SilverRock Municipal Golf Course ("Golf Course"); and WHEREAS, the Agency now owns 525 acres of property (the "SilverRock Property") located in La Quinta Redevelopment Project Area No. 1 (the "Project Area"); and WHEREAS, the Agency wishes to update its prior findings now that it is ready to commence construction of the public buildings on the Golf Course; and WHEREAS, the need for recreational facilities and opportunities was documented as one of the conditions of blight that justified the formation of the La Quinta Redevelopment Project Area No. 1 ("Project Area"), as cited in the October 1983 Report to the La Quinta City Council on the Proposed Redevelopment Plan for La Quinta Redevelopment Project Area No. 1; and 86 G:\WPDOCS\CCReso-COA\SR RDA Reso.DOC 4 Resolution RA 2004- SilverRock Health & Safety Code Findings Adopted: April 6, 2004 WHEREAS, the construction of the Golf Course would afford the Agency the opportunity to address some of the aforementioned conditions of blight; and WHEREAS, the Agency's Implementation Plan prepared pursuant to Health and Safety Code Section 33490 provides for the Golf Course; WHEREAS, the Golf Course will be located in La Quinta the Project Area; and WHEREAS, there is inadequate funding within the City's General Fund or from other sources to construct the Golf Course; and WHEREAS, Section 518 of the Redevelopment Plan for La Quinta Redevelopment Project Area No. 1, as amended by Amendment No. 1, authorizes the Agency to undertake the funding of the Golf Course; and WHEREAS, the California Community Redevelopment Law, at Health and Safety Code Section 33679 requires that if any of the publicly owned improvements to be funded with Agency funds is a publicly owned building, and the Agency's funds for such purpose are tax increment funds the Agency receives pursuant to Health and Safety Code Section 33670, the Agency and City Council hold a duly noticed joint public hearing in connection with the proposed use of Agency funds for such purpose and in connection therewith have prepared a report summarizing (i) the estimated amounts of such tax increment funds to be used for such purpose, (ii) the facts supporting the findings required to be made pursuant to Health and Safety Code Section 33445, and (iii) setting for the redevelopment purpose for which such funds are being used to pay for such purpose (the "Summary Report"); and WHEREAS, the Agency, in compliance with Health and Safety Code Section 33679, duly noticed a public hearing on the matter of the use of Agency funds for payment for the cost of the installation and construction of certain publicly owned improvements made part of the Golf Course; and WHEREAS, the Summary Report was duly and timely prepared and made available for public review, inspection, and copying in compliance with Health and Safety Code Section 33679; and WHEREAS, on April 6, 2004, the Agency held its duly noticed public hearing on the Agency's payment for certain publicly owned improvements associated with the Golf Course ("Public Hearing"); and G:\WPDOCS\CCReso-COA\SR RDA Reso.DOC 875 Resolution RA 2004- SilverRock Health & Safety Code Findings Adopted: April 6, 2004 WHEREAS, at the Public Hearing the Agency received and considered the staff report and such other information, testimony, and evidence as presented; and NOW, THEREFORE, BE IT RESOLVED, by the La Quinta Redevelopment Agency as follows: SECTION 1. The above recitations are true and correct and are adopted as the findings of the Agency Board. SECTION 2. The Agency Board hereby authorizes Agency funding up to $1 1,510,000 to be utilized for the Golf Course. SECTION 3. Pursuant to Health and Safety Code Section 33445 (a), the Agency finds and determines that: A. The Golf Course will be located within the Project Area and thus will provide recreational facilities and opportunities for the residents, businesses, property owners, and others located within the Project Area, as well as the City at -large. B. That no other reasonable means of financing the buildings, facilities, structures, and other improvements are available to the community other than Agency funding. In light of the current economic situation in the nation, the State and locally, the continuing requirement for the City and Agency to provide contributions to the State, and that City general funds are already committed to expenditures for necessary police, fire, and other public safety purposes, recreational purposes, administrative, operations, maintenance purposes, and other previously identified capital improvements, Agency funding is the only available source of funds to the community for the Golf Course. C. The Golf Course will assist in the elimination of one or more blighting conditions inside the Project Area, including the lack of recreational facilities and opportunities, and is consistent with the Agency's Implementation Plan adopted pursuant to Health and Safety Code Section 33490. PASSED, APPROVED and ADOPTED at a regular meeting of the La Quinta Redevelopment Agency held on this 61h day of April, 2004, by the following vote: AYES: NOES: G:\WPDOCS\CCReso-COA\SR RDA Reso.DOC 88 6 Resolution RA 2004- SilverRock Health & Safety Code Findings Adopted: April 6, 2004 ABSENT: ABSTAIN: TERRY HENDERSON, Chair La Quinta. Redevelopment Agency ATTEST: JUNE S. GREEK, CMC, Agency Secretary La Quinta Redevelopment Agency APPROVED AS TO FORM: M. KATHERINE JENSON, Agency Counsel La Quinta Redevelopment Agency, California 29 G:\WPDOCS\CCReso-COA\SR RDA Reso.DOC 7 REVISED SUMMARY REPORT FOR THE EXPENDITURE OF TAX INCREMENT REVENUE BY THE LA QUINTA REDEVELOPMENT ON CLUBHOUSE, MAINTENANCE BUILDING, PUMP HOUSE AND RESTROOM FACILITIES AT SILVERROCK RESORT FOR THE CITY OF LA QUINTA PURSUANT TO HEALTH & SAFETY CODE SECTIONS 33445 AND 33679 March 30, 2004 The La Quinta Redevelopment Agency ("Agency") is the redevelopment agency activated by the City Council of the City of La Quints ("City' or "City Council" as appropriate) pursuant to the California Community Redevelopment Law (Health & Safety Code § 33000 et seq.). The Agency and City Council have scheduled a joint public hearing for April 6, 2004 to consider the Agency's use of up to $11,510,000 of proceeds from the Series 2002 Tax Exempt Bonds and the Series 2003 Taxable Bonds to fund the construction of temporary and permanent clubhouses, a maintenance building and yard, Phase 1 golf course restroom facilities, and the irrigation pump house building as part of the Phase 1 golf course improvements at SilverRock Resort. Debt service payments for these bonds are funded by La Quinta Redevelopment Project No. 1 non -housing tax increment revenue. All of these facilities will be subsequently owned by the City. This is a revised Summary Report. The original Summary Report indicated that $10,710,000 of Bond proceeds would be used for these facilities. Subsequent review of the construction estimates lead to revised costs for the temporary clubhouse (increasing from $1.2 million to $1.4 million) and the maintenance building and yard ($1.2 million to $1.8 million). The total amount of Bond proceeds that will be used is $11, 510, 000. Pursuant to Health and Safety Code Sections 33445 and 33679, whenever the Agency proposes to use tax increment funds to acquire land and/or to pay for the construction or installation of a publicly owned building, the Agency and City Council must hold a public hearing on the use of the tax increment funds for that purpose. At the conclusion of the public hearing, the Agency and City Council may adopt resolutions approving the use of Agency tax increment funds for that purpose. Prior to the public hearing, Health and Safety Code Section 33679 requires that the Agency prepare a summary report that: • Estimates the amount of tax increment revenue proposed to be used to acquire land and pay for the construction of any publicly owned building, including interest payments. • Provides an explanation of why the buildings, facilities, structures, or other improvements are of benefit to the project area or the immediate neighborhood in which the project is located. • Provides an explanation as to why no other reasonable means of financing the buildings, facilities, structures, or other improvements, are available to the community. 90 G:\WPDOCS\Documents\SumRptSilverRock.doc 8 • Describes how the expenditure of tax increment revenue for the acquisition of land or the cost of buildings, facilities, structures, or other improvements will assist in the elimination of one or more blighting conditions inside the project area or provide housing for low- or moderate -income persons, and is consistent with the implementation plan adopted pursuant to Section 33490. • Describes the redevelopment purpose for which the tax increment revenue is being used to pay for the land and construction of such publicly owned building. BACKGROUND In May 2002 the City and Agency approved the purchase of 525 acres of land for the development of a golf resort. This action initiated master planning and golf course/driving range design activities during 2003, and approval, in March 2004, of contracts to build the first tournament quality golf course and related improvements. The Agency sold tax exempt and taxable tax allocation bonds to fund this effort. Tax exempt bond proceeds are being used to fund the public activity uses, and the taxable bonds the private activity uses, that will be located at SilverRock Resort. Construction has commenced on the Phase 1 improvements. These include: • an 18-hole tournament quality golf course, driving range, practice facility, and restrooms • a temporary, and once the Phase 1 golf course is operational, the permanent clubhouse and golf -cart storage facility • on -and off -site utility, street, drainage systems and irrigation systems, including a structure to house the main system irrigation pumps • a facility maintenance building and yard. SUMMARY REPORT ITEMS Estimates of the amount of tax increment revenue proposed to be used to acquire land and pay for the construction of any publicly owned building, including interest payments. On May 15, 2002 that Agency and City Council approved the summary report and the expenditure of tax increment revenue to purchase the land upon which the public facilities and improvements (the subject of this summary report) will be constructed. This summary report deals with the cost to construct the temporary and permanent clubhouses, a maintenance building and yard, Phase 1 golf course restroom facilities, and an irrigation system pump house building. The total ' estimated cost to construct these facilities is $11,510,000, not including interest expense. It is estimated that total interest costs for the Series 2002 and 2003 Bond proceeds used to fund these improvements will be $13,000,000, for a total estimated cost of $24,510,000. The estimated construction cost for each facility is as follows: Temporary clubhouse $1,400,000 Permanent clubhouse 8,000,000 SumRptSilverRock 919 Maintenance building 1,800,000 Phase 1 course restrooms 250,000 Pump house building 60,000 An explanation of why the buildings, facilities, structures, or other improvements are of benefit to the project area or the immediate neighborhood in which the project is located. These public buildings and facilities will be located in La Quinta Redevelopment Project Area No. 1 which was established in December 1983. Two of the blighting conditions cited for establishing the Project Area were the lack of recreation facilities and the lack of enterprises that stimulate business activity. Constructing the Phase 1 golf course and these facilities at the SilverRock Resort will afford the opportunity to develop municipal/public golf and other passive recreation uses. Further, this will provide the Agency additional means to draw resort, hospitality, and related uses that will attract patrons to the Project Area, generating additional demand for Project Area businesses. The temporary clubhouse improvements entail restoring and improving the Ahmanson family ranch house. This building has been identified as a historic structure. The $1.4 million of improvements slated for this facility will restore the structure and facilitate public access and use. Once the permanent clubhouse is operational, these facilities will then be available for small conferences and community events. The permanent clubhouse is proposed to serve not only the needs of the two golf courses planned for the SilverRock Resort, but to also provide additional meeting space, restaurant and recreation facilities for Project Area residents as well as the greater community. The restrooms are needed to service the needs of the Phase 1 golf course patrons, while the maintenance building and yard, and the pump house building, will service the operations of the Phase 1 and 2 golf courses, and the park, trails, and rights -of -ways that will developed for public use. An explanation as to why no other reasonable means of financing the buildings, facilities, structures, or other improvements, are available to the community. In light of the current economic situation in the nation, State, and locally, the continuing reallocation of City and Agency funds to resolve the State budget deficit, and existing City funding obligations towards police, fire, other public safety, recreation, administrative, operations and maintenance purposes, the City does not have the capacity to fund these improvements without the use of Project No. 1 tax increment revenue. The City's February 2004 cash -flow forecast indicates that the General Fund will experience modest surpluses during the next three years. Starting in fiscal year 2007-2008, the General Fund is projected to incur deficits because a majority of General Fund revenue is derived from one-time development fee income. One reason for developing SilverRock Resort is to secure new revenue generating uses that produce transient occupancy and sales tax income to off -set the projected decline in one-time development fee income. This is needed to support City services. Grant funds are available for park facility and open space improvements. However, a majority of the proposed expenditures will be for golf course related improvements; ample grant funding in not available for golf related improvements. Finally, property assessments may be an option. However, these facilities will serve both the Project Area and the greater community. Securing the necessary super majority vote to increase property assessments would be difficult given the recent failure to secure the necessary majorities to pass a City-wide fire and paramedic assessment. 9 SumRptSilverRwk 10 A description as to how the expenditure of tax increment revenue for the acquisition of land or the cost of buildings, facilities, structures, or other improvements will assist in the elimination of one or more blighting conditions inside the project area or provide housing for low- or moderate -income persons, and is consistent with the implementation plan adopted pursuant to Section 33490. The facilities will be located in the Project Area which was established, in part, to address a lack of recreation facilities and a lack of enterprises that stimulate business activity. The facilities will accommodate the operations of a tournament quality golf course that will stimulate the development of resort, recreation and retail uses, and generate additional demand for local businesses. Further, the golf and other planned passive recreation uses will expand recreation opportunities for both Project Area and City residents. This project is listed under the Economic/Community Development Program component of the Agency's Implementation Plan as amended on May 15, 2002, pursuant to Section 33490. Describe the redevelopment purpose for which the tax increment revenue is being used to pay for the land and construction of such publicly owned building. The Redevelopment Plan for Project No. 1 identifies expanding recreation opportunities and business enterprises in the Project Area as redevelopment goals. Further, both the Agency's Report to City Council and the subsequent Implementation Plans identified the need to expand cultural and recreation facilities as a means to address blight within the Project Area. Using tax increment revenue to fund the construction of these facilities will implement the goal contained in the Redevelopment Plan, and address a condition of blight identified in both the Agency Report to Council and subsequent Implementation Plans. This summary report has been prepared in compliance with Health and Safety Code Section 33679. A photocopy may be obtained from the Agency Secretary/City Clerk by paying the usual photocopy fee regularly charged by the Agency and City. 93 SumRptSilverRock 111