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2005 07 19 RDA Minutes LA aUINTA REDEVELOPMENT AGENCY MINUTES JULY 19, 2005 CALL TO ORDER City Clerk June Greek called the La Ouinta Redevelopment Agency to order at 2:00 p.m. and declared a recess to and until the hour of 3:00 p.m. due to lack of a quorum. CLOSED SESSION - None A regular meeting of the La Ouinta Redevelopment Agency was called to order by Chairman Osborne at 4:49 p.m. PRESENT: Agency Board Members: Adolph, Henderson, Sniff, and Chairman Osborne ABSENT: Agency Board Member Perkins MOTION: It was moved and seconded by Agency Members Sniff/Adolph to excuse Agency Board Member Perkins. The motion was unanimously carried, with Agency Member Perkins ABSENT. PUBLIC COMMENT There were no requests to speak at this time. CONFIRMATION OF AGENDA Chairman Osborne reordered the agenda to move Consent Calendar Item No.6, to be considered as Business Session Item No.3. APPROVAL OF MINUTES 1. APPROVAL OF MINUTES OF JUNE 15, 2005. It was moved and seconded by Board Members Henderson/Adolph to approve the minutes of June 15, 2005 as submitted. The motion was carried with Board Member Perkins ABSENT. City of La Quinta Redevelopment Agency Minutes 2 July 19, 2005 2. APPROVAL OF MINUTES OF JULY 5, 2005. It was moved and seconded by Board Members Sniff/Adolph to approve the minutes of July 5, 2005 as submitted. The motion carried with Board Member Perkins ABSENT and Chairman Osborne ABSTAINED. CONSENT CALENDAR 1. APPROVAL OF DEMAND REGISTER DATED JULY 19, 2005. 2. TRANSMITTAL OF TREASURER'S REPORT DATED MAY 31,2005. 3. TRANSMITTAL OF REVENUE AND EXPENDITURE REPORTS DATED MAY 31, 2005 AND INVESTMENT SUMMARY REPORT FOR THE QUARTER ENDING JUNE 30, 2005. 4. APPROVAL OF PLANS, SPECIFICATIONS, AND ENGINEER'S ESTIMATE FOR SilverRock RESORT MONUMENT SIGNS. 5. APPROVAL OF AMENDMENT NO.6 TO THE KEITH COMPANIES FOR DRAINAGE IMPROVEMENT DESIGN AT SilverRock RESORT. 6. ADOPTION OF AN EMERGENCY CONTRACT RESOLUTION AUTHORIZING STAFF TO NEGOTIATE A CONSTRUCTION CONTRACT FOR THE SilverRock RESORT MOUNTAIN DRAINAGE IMPROVEMENTS. 7 . APPROVAL OF AN EXCLUSIVE NEGOTIATION AGREEMENT BY AND BETWEEN THE LA QUINT A REDEVELOPMENT AGENCY AND COACHELLA VALLEY HOUSING COALITION. MOTION: It was moved and seconded by Board Members Sniff/Henderson to approve the Consent Calendar as amended with Item No.6 moved to Business Session Item No.3. The motion carried with Board Member Perkins ABSENT. BUSINESS SESSION 1 . CONSIDERATION OF (1) A RESOLUTION APPROVING THE FISCAL YEAR 2005-2006 LA QUINT A REDEVELOPMENT AGENCY BUDGET AND (2) A RESOLUTION DETERMINING THE PLANNING AND ADMINISTRATION EXPENSES TO BE FUNDED IN FISCAL YEAR 2005-2006. \'. ~ ".\ ,. City of La Ouinta Redevelopment Agency Minutes 3 July 19, 2005 Finance Director John Falconer presented the staff report. MOTION: It was moved and seconded by Board Members Adolph/Henderson to adopt a resolution entitled: RESOLUTION NO. RA 2005-009 A RESOLUTION OF THE LA QUINT A REDEVELOPMENT AGENCY APPROVING A BUDGET FOR FISCAL YEAR 2005-2006. The motion was carried with Board Member Perkins ABSENT. MOTION: It was moved and seconded by Board Members Sniff/Adolph to adopt a resolution entitled: RESOLUTION NO. RA 2005-10 A RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF LA QUINT A DETERMINING THAT THE PLANNING AND ADMINISTRATION EXPENSES TO BE FUNDED IN FISCAL YEAR 2005-2006 BY THE LOW- AND-MODERATE INCOME HOUSING FUND ARE NECESSARY FOR THE PRODUCTION, IMPROVEMENT, AND/OR PRESERVATION OF AFFORDABLE HOUSING FOR LOW-AND-MODERATE INCOME HOUSE- HOLDS. The motion was carried with Board Member Perkins ABSENT. 2. CONSIDERATION OF CONCEPT PLAN/SITE PLAN PURSUANT TO THE . EXCLUSIVE NEGOTIATION AGREEMENT BY AND BETWEEN THE LA QUINT A REDEVELOPMENT AGENCY AND DDC DESERT DEVELOPMENT, INC., FOR DEVELOPABLE PARCELS WITHIN SilverRock RESORT. The staff report was presented by the Contract Redevelopment Agency Director, Frank Spevacek. Mr. Ted Lennon presented the changes that have been made, based on the previous comments they have' received from the Agency. He distributed a new site plan booklet for the Agency Members to follow along with his power-point presentation. Mr. Lennon provided a quick review of the vision, City of La Ouinta Redevelopment Agency Minutes 4 July 19, 2005 the miSSion statement, the values, strategy, and goals. He requested the Agency Members take some time to read the general positioning statement because it has been based upon the three prior workshops and the input they have received from the Agency. He reviewed the boutique hotel which will be called The Fountains at SilverRock. He said it will contain 128 to 150 hotel rooms. He referred to the photos which have been reviewed and effectively approved. He then went on to area two, and pointed out the enhanced boardwalk which will run along the lake from the feature hotel to the major restaurant area. He said the boardwalk may even extend to include the resort casitas/time shares at the southerly end of the lake. He said the feature hotel will be a great resort hotel which will capitalize on the expansive views. There will then be some small clusters of low-profile villas around the perimeter of the feature hotel. He reported DDC recently held a study session with the managers of their major development hotels and they brainstormed the feature hotel and the boutique hotel. Mr. Lennon said he is very excited to get the project started. He stated the Conference Center is still shown between the feature hotel and the retail village, but it will be closer to the retail area. They are still limited, however, by the Master Plan to 25,000 square feet for the retail area. There will be an amphitheater and two theme restaurants at the water's edge in this area. Mr. Lennon outlined the plan for a facility south of the retail area that will probably be best served as a time-share provided it will produce the same kind of income the City would receive from Transient Occupancy Tax (TOT). He said this facility will be more laid-back than the feature hotel and will be designed for longer-term stays. The units will be larger and geared more toward family resort use. The up-scale golf villas will be four-star units that have access to all of the feature hotel services and amenities. The villas will be from 21 to 50 units and will accommodate larger groups with the look and feel of a 4-bedroom luxury home. In area four, the final phase to be built will be dictated by what happens in the other properties, but is being conceived as a 75 to 200 unit development in the south east area of the property. City of La Ouinta Redevelopment Agency Minutes 5 July 19, 2005 Mr. Lennon said he is eager to see a golf performance center included in the Civic area and he felt they can provide the Agency with a multi-use area design that can be covered with turf to provide dust control, a parking area for major events, and other special uses. He showed the layout of a bus route that will serve the resort as well as serve as a shuttle to other featured areas of the City. They will also be adding a pedestrian/golf cart route throughout the areas of the resort. He displayed the preliminary development schedule that breaks each component of the resort down to predevelopment and planning, final design and permitting, and the construction phase. He said this schedule hinges on the negotiations being completed in 90 days. They could immediately get the architects started on the boutique hotel and get started on some of the other preliminary designs for other projects. He sees a start-to-finish time for the grand opening to take place next summer and to have The Fountains up and running for the season. The time line for the feature hotel is predicated on no changes between now and then removing the current restrictions. Mr. Lennon recommended the second golf course should go along the same time line as the feature hotel in 2009. He said the golf performance center, if it works out, would also open at the same time. The resort retail village would be expected to be 50% complete with the opening of the feature hotel and the remainder of the retail finished out within the next year. Phase four, the resort casitas might also be moved up to go along with the feature hotel time schedule. Board Member Henderson said she feels comfortable with a market-driven product and likes the flexibility the timeline offers. Mr. Lennon said one other aspect is the cost of the off-site improvements and they have done the engineering and provided that information to the agency staff. Board Member Sniff felt the market needs to be created and the agency shouldn't have to wait until the market studies show when the time is best. Mr. Lennon agreed markets can be created but said the problem lies in convincing the investment market and the financing firms. He said there currently exists an excellent market and economy and he would welcome the restrictions being removed and having the opportunity to move the time schedule up. City of La Ouinta Redevelopment Agency Minutes 6 July 19, 2005 Board Member Sniff said he would like to list some of his observations: 1) He said he is not "over-sold" on the name of the boutique hotel; 2) He questioned the boutique hotel being built first, if it might affect the prospect of getting a larger hotel. Mr. Lennon responded the larger hotel cannot be built with only 10,000 square feet of meeting space, which it would be limited to at this point. He said the site for the boutique hotel is also ready for construction, with the golf course, roads and utilities already in place. 3) He expressed concern about having to raise the site for the boutique hotel. Mr. Lennon responded, the site will be terraced down to the lake and they may have to remove dirt from the site. 4) Explained his desire to see something "uniquely La Ouinta" in the architectural theme. He questioned the reference to a general store. Mr. Lennon explained that it would be located in the retail area and he envisions it having an old-fashioned soda fountain, candy store, food items and resort related items. 5) Asked if the reason for building the casitas is a financing strategy. Mr. Lennon responded this program will be set up in such a way that units will be purchased by individuals and be in the rental program or paying fees equivalent to TOT so the City still benefits. He said the other major benefit is that if you have all hotels, the cost of construction of a hotel room might be $300,000 and that is what would go on the tax rolls. If that unit is sold for $600,000, that amount would go on the tax rolls and the Redevelopment Agency would receive that major increase in increment. 6) Expressed concern about the retail village and wondered if it should be de-emphasized in the timing so it isn't built first. Mr. Lennon said it needs to be tied to the major hotel, possibly three and a half years off. 7) Felt the entrance, lobby, major features of the boutique hotel should be more centralized in the development. Mr. Lennon responded this has been designed to have that area at the lakefront. He feels this is the most beautiful spot on the project and secondly, he would like to have the guests who are not staying at the hotel, but are using it for events like weddings, to be contained in one area and not driving all through the property and possibly disturbing the paying guests. City of La Ouinta Redevelopment Agency Minutes 7 July 19, 2005 Board Member Sniff said he still wants to see some special unique La Ouinta features and he wants to know why the project isn't being built with significant use of solar power. Mr. Lennon said he is looking into solar power at this time based on a request from an associate, Katie Barrows to give it strong consideration. Board Member Adolph asked about the permanent clubhouse, and what the "critical path" is for it. Mr. Lennon said it needs to be addressed from the standpoint of will the agency establish a budget and build it to that budget or will they build the "dream clubhouse" and pay whatever it might cost. He said once the Master Plan is approved he would want it to all work together so that there aren't redundancies built into the various facilities. He emphasized the importance of the Clubhouse being a very special facility. When building a private resort clubhouse, he said the goal is to make the quality of the clubhouse equal to or above any of the other residences at the resort. Mr. Lennon reiterated his firm would very much like to be involved in the design and development of the clubhouse. He stated he would rather see the clubhouse be small and elegant rather than be large and utilitarian looking. Board Member Adolph questioned the location of the kids club at the feature hotel, saying he doesn't feel the proper setting should be at the best view location on the whole site. Mr. Lennon's response was he agrees that the site shown for the kid's camp is not in its final location. The hotel architects will be studying all the elements to be included for the optimal locations. Board Member Henderson asked if a substantial part of this project will be its ability to service conventions. Mr. Lennon said in the boutique hotel they could realize as much as 62-63% group business for up to 100 people. He said the leisure business is really confined pretty much to weekends. He said the feature hotel could have as much as 70% groups of 200-250 people. Ms. Henderson was very pleased with the bus/shuttle routing design and asked if the line going through the civic use center would be a publicly traveled road. Mr. Lennon explained, for the bus itself, he sees it as a public route that would be a cooperative effort between the hotel's operators and the City. He said to avoid it becoming a public shortcut for auto traffic, it could be gated to only allow entrance by the shuttles using a transponder in the bus. City of La Ouinta Redevelopment Agency Minutes 8 July 19, 2005 Agency Member Henderson said she was delighted the Mayor brought up the subject of having DDC involved with the clubhouse as a design/build concept. She said while they are on site and while their expertise is being put to use on the boutique hotel, the agency should take advantage of the opportunity to have them make a proposal to build the permanent clubhouse. Chairman Osborne said he thinks DDC has done a wonderful job to-date. He said he really looks forward to moving this and the clubhouse along. He is very impressed with the design of the boutique hotel and is anxious to see it get started. Board Member Henderson said she would like to address the comment made by Board Member Sniff that he was not particularly pleased with the name of the boutique hotel. She felt in all fairness, the agency should give some input on that matter and for the record she likes the name The Fountains at SilverRock. Chairman Osborne, said he sees those decisions as being made at a later date along with the costs to the City. Board Member Adolph noted he already has received inquiries from two couples who are interested in purchasing units at the boutique hotel. He related he also saw a golf cart for the first time utilizing the multi-use trail on Jefferson. Mr. Lennon said he and his partner, Tom Cullinan, have hired a new project manager for this project and introduced Tom Devlin. M.... Devlin has been responsible for building and remodeling several dozen golf courses in the country and has great experience. Board Member Sniff said he is going to vote for approval of the concept plan but he is not going to commit to any future decisions in favor of the project until he is convinced the funding, design and the investment make good sense. He said he would like to have some level of comfort that the agency will be dealing with the same principals throughout this project. Mr. Lennon said this is the most exciting project he has ever been involved in and he certainly plans to be around through build-out. MOTION: It was moved and seconded by Agency Members Sniff/Adolph to approve the concept plan/site plan for the developable parcels within SilverRock Resort and direct staff to initiate negotiations that lead to the preparation of a development and disposition agreement (DDA) with DDC Desert Development, Inc. The motion was carried with Board Member Perkins ABSENT. City of La Ouinta Redevelopment Agency Minutes 9 July 19, 2005 3. ADOPTION OF AN EMERGENCY CONTRACT RESOLUTION AUTHORIZING STAFF TO NEGOTIATE A CONSTRUCTION CONTRACT FOR THE SilverRock RESORT MOUNTAIN DRAINAGE IMPROVEMENTS. Public Works Director/City Engineer Tim Jonasson presented the staff report and said the improvements are intended to prevent the erosion problems caused by mountain storm runoff that were experienced in February. Chairman Osborne expressed his dissatisfaction with the work done previously by PACE and the Keith Companies (TKC). He felt this appropriation is necessary because they failed to properly engineer the mountain stream runoff for the golf course on their original contract. Board Member Sniff agreed with the comments of Chairman Osborne and said he sees it as a reward for not doing the job properly in the first place. Director Jonasson explained this emergency contract is not with PACE or the Keith Companies (TKC). He said this is to be an agreement with a contractor to do the actual improvements that PACE and TKC designed. Member Adolph asked if negotiations are still ongoing with PACE and TKC. City Attorney Jenson responded, since this may be a matter of potential litigation she feels is not an appropriate subject at this time. She did confirm she and Director Jonasson have started a series of meetings last week with the contractors. Johnny Pott of Landmark Golf, the course operators, in response to Chairman Osborne said he doesn't wish to take authorship of the plans but the reason for the flooding was the newness of the course. He said the turf had just been placed and hadn't had a chance to even settle, so when the rains were especially heavy they did show what the problems were with runoff from the mountain. He said to be able to complete the work they are doing now on the waste bunkers, the water has to be stopped at the source. He said there are three holes that are being repaired and need to be completed prior to the over-seeding in approximately 55 days. He also noted the Public Works Director is hoping to continue working wi~h the contractor who presently is on-site and who he feels are very capable. It was moved by Board Members Henderson/Adolph to adopt an emergency contract resolution authorizing staff to negotiate a construction contract, authorize the Executive Director to enter into an agreement for constructing the SilverRock Resort Mountain Drainage Improvements, Project No. 2002- 07L, and appropriate $357,000 from Project Area No.1 reserves. City of La Quinta Redevelopment Agency Minutes 10 July 19, 2005 Board Member Sniff asked City Attorney Jenson if this action requires a 4/5th vote to pass and what would happen if it doesn't pass by that margin. She responded that it does require a 4/5 vote. City Manager Genovese stated the practical answer is that the Agency will be in serious trouble getting the work completed on time. Board Member Sniff asked if staff is 100% confident that the contractors can perform. Mr. Genovese replied the contract hasn't been negotiated so he doesn't know who will be performing the work. Board Member Sniff asked if staff is 100% confident that the work being performed based on the plans of PACE and TKC will be done correctly and will be adequate or more than adequate to take care of the problem. Mr. Genovese answered "No, I'm not an engineer, I'm not a registered engineer and therefore I can't say if the plans are going to correct all the problems of run-off". He said his best estimate is he believes this work should correct the problem. The motion was carried with Board Member Perkins ABSENT. STUDY SESSION - NONE CHAIR AND BOARD MEMBERS' ITEMS - NONE PUBLIC HEARINGS - NONE ADJOURNMENT MOTION: It was moved by Board Members Sniff/Adolph to adjourn at 6:03 p.m. to a regularly scheduled meeting of the Redevelopment Agency to be held on August 2, 2005 commencing with closed session at 2:00 PM and open session at 3:00 PM in the City Council Chambers, 78-495 Calle Tampico, La Ouinta, CA 92253. The motion was carried with Board Member Perkins ABSENT. Respectfully submitted, ~-d.~ June S. Greek, CMC City Clerk