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2025 02 04 CC MinutesCITY COUNCIL MINUTES TUESDAY, FEBRUARY 4, 2025 CALL TO ORDER A regular meeting of the La Quinta City Council was called to order at 3:30 p.m. by Mayor Evans. PRESENT: Councilmembers Fitzpatrick, McGarrey, Pena, Sanchez, and Mayor Evans ABSENT: None PUBLIC COMMENT ON MATTERS NOT ON THE AGENDA — None CONFIRMATION OF AGENDA — Confirmed CLOSED SESSION 1. CONFERENCE WITH LEGAL COUNSEL — EXISTING LITIGATION; PURSUANT TO PARAGRAPH (1) OF SUBDIVISION (d) OF GOVERNMENT CODE SECTION 54956.9; CASES NAMES AND NUMBERS — MULTIPLE (listed below, all in U.S. Bankruptcy Court, District of Delaware) CASE NAME: CASE NUMBER SilverRock Development Company, LLC 24-11647 SilverRock Lifestyle Residences, LLC 24-11648 SilverRock Lodging, LLC 24-11650 SilverRock Luxury Residences, LLC 24-11652 SilverRock Phase I, LLC 24-11654 RGC PA 789, LLC 24-11657 COUNCIL RECESSED THE OPEN SESSION PORTION OF THE MEETING AND MOVED INTO CLOSED SESSION AT 3:31 P.M. MAYOR EVANS RECONVENED THE OPEN SESSION PORTION OF THE CITY COUNCIL MEETING AT 4:00 P.M. WITH ALL MEMBERS PRESENT REPORT ON ACTION(S) TAKEN IN CLOSED SESSION: City Attorney Ihrke reported no actions were taken in Closed Session that require reporting pursuant to Government Code section 54957.1 (Brown Act): Council's authorization remains in place for the City Attorney, in coordination with the City Attorney's Office and Special Counsel, to defend and protect the interests of the City in the multiple bankruptcy cases filed by SilverRock Development Company and its responsive CITY COUNCIL MINUTES Page 1 of 8 FEBRUARY 4, 2025 affiliates as reported out for Closed Session Item No. 2 from the August 6, 2024, Council meeting. PLEDGE OF ALLEGIANCE Councilmember Pena led the audience in the Pledge of Allegiance. PUBLIC COMMENT ON MATTERS NOT ON THE AGENDA PUBLIC SPEAKER: Jeff Fishbein, Chair of the La Quinta Chamber of Commerce, Coldwell Banker Realtor, and La Quinta resident — provided an update on the recent Social Club mixer at Kiki's restaurant and Legislative Breakfast with Senator Ochoa Bogh; upcoming ribbon cutting ceremony for Desert Breeze Skin Care Aesthetics, 2025 La Quinta Hot Rod and Custom Car Show event, and Legislative Breakfast with Assemblymember Gonzalez. PUBLIC SPEAKER: Neeta Quinn, La Quinta — expressed concerns with the Riverside County Board of Supervisors adopting a resolution "affirming Riverside County to be a Vibrant, Compassionate, and Welcoming County for all Law-abiding Immigrants and Refugees," and asked the City to pass legislation declaring La Quinta as "a non -sanctuary city" as other California cities have done. PUBLIC SPEAKER: Jaime Velasquez, La Quinta — expressed concerns with vehicles speeding near the Seasons Dog Park, and requested the City consider placing speed warning signs near the park entrance and solar -powered radar speed signs or speed bumps on Summer View Way or Cloud View Way. PUBLIC SPEAKER: Karin Jaffie, Cathedral City Cove, representing Friends of the Desert Mountain — thanked the City for being a model partner in conservation of public lands; expressed gratitude for the City's hiking trails infrastructure, maintenance, and accessibility which allows people with disabilities to participate in "adaptive hikes." ANNOUNCEMENTS, PRESENTATIONS AND WRITTEN COMMUNICATIONS 1. SILVERROCK (FORMERLY TALUS) DEVELOPMENT PROJECT — STATUS UPDATE City Attorney lhrke said on August 5, 2024, SilverRock Development Company, LLC and its affiliates, collectively referred to as "SDC," voluntarily petitioned for Chapter 11 bankruptcy in U.S. Bankruptcy Court in Delaware; and per Council's direction and approval, the City retained Special Counsel who has continuously been working with the City Manager and City Attorney throughout these proceedings. Prior Announcements regarding the bankruptcy case are available on the City's website at www.laquintaca.gov/taluslq. On January 23, 2025, the U.S. Bankruptcy Court approved the Final Order relating to a Term Sheet for Debtor -In -Possession (DIP) Financing, with attachments thereto that CITY COUNCIL MINUTES Page 2 of 8 FEBRUARY 4, 2025 include a Memorandum of Understanding (MOU), City -approved final budget, and generally referred to as the "DIP Financing." As previously summarized, the DIP Financing has a not to exceed amount of $11 million as a "priming" loan from the City that serves as the financing to cover the entire anticipated timeframe for the bankruptcy case, which includes finding a new developer, entering a reorganization plan, and negotiating any amendments or new agreements relating to the project. This "priming" loan, available under federal bankruptcy law, means the City will have a "super -priority" security interest for the repayment of the loan, including "super -priority" over all other liens on the real and personal property held by debtors, subject to limited specific "carve -outs." The proceeds of the loan are to be administered through the U.S. Bankruptcy Court - approved Chief Restructuring Officer (CRO), an independent fiduciary for the administration of the debtor's estate, and, as previously announced, debtor SilverRock Development Company and its affiliates are no longer managed or controlled by Robert Green Company but is now governed by the controlling manager Christopher Sontchi, a retired, former bankruptcy judge who has previously assisted other companies in their restructuring as part of bankruptcy court proceedings. Also, in open court at the January 23, 2025, hearing, the U.S. Trustee confirmed that the U.S. Trustee's Office's motion to dismiss, or alternatively to appoint a Trustee for the bankruptcy case, will be taken off -calendar, meaning the motions will not be considered for any final ruling by the U.S. Bankruptcy Court. City Manager McMillen said, as previously reported, RD Olson Construction Company, which was the primary contractor of the project, was mobilized on January 6, 2025, to start clean-up of the project site, consisting of removal of weeds that had grown in much of the area, including the foundations and pool areas, and construction materials that had been scattered throughout the site, such as piping, conduits, and lumber, re -gluing of the site for dust control mitigation is being finalized this week, and the focus is on protecting and preserving the existing structures as best as possible in order to allow the project to be marketed. Mr. McMillen noted the Cumming Group, an independent consultant retained by the CRO, is preparing a "Property Condition Report," expected to be completed the week of February 17, 2025, to identify the site condition and cost analysis to complete the project. Mr. McMillen reported following the U.S. Bankruptcy Court approval of the DIP Financing at the January 23, 2025, hearing, as announced by the City Attorney, on January 24, 2025, the City engaged Jones, Land, LaSalle (JLL) to provide marketing services for the project to secure a future developer; Mr. McMillen has explained the project's history to JLL and identified the key items of great concern for the City moving forward; and JLL is scheduled to tour the project site this Thursday. CITY COUNCIL MINUTES Page 3 of 8 FEBRUARY 4, 2025 CONSENT CALENDAR 1. APPROVE COUNCIL MINUTES DATED JANUARY 21, 2025 2. ADOPT ORDINANCE NO. 620 ON SECOND READING APPROVING DEVELOPMENT AGREEMENT 2024-0001 TO ESTABLISH THE RESPONSIBILITIES OF THE DEVELOPER FOR BRAVO ESTATES (TTM 31852); CEQA: THE DESIGN AND DEVELOPMENT DEPARTMENT HAS DETERMINED THAT THE PROJECT IS CONSISTENT WITH ENVIRONMENTAL ASSESSMENT 2003-495; LOCATION: NORTHWEST CORNER OF AVENUE 52 AND MADISON STREET 3. ADOPT RESOLUTION TO APPROVE FINAL PARCEL MAP NO. 38740 LOCATED WITHIN THE SOLTERRA RESIDENTIAL DEVELOPMENT AT THE SOUTHWEST CORNER OF AUTO CENTRE DRIVE AND LA QUINTA DRIVE [RESOLUTION NO. 2025-003] 4. AUTHORIZE OVERNIGHT TRAVEL FOR MAINTENANCE AND OPERATIONS DEPUTY DIRECTOR TO ATTEND THE CALIFORNIA JOINT POWERS INSURANCE AUTHORITY PARKS AND RECREATION ACADEMY IN OXNARD, CALIFORNIA, FEBRUARY 11-13, 2025 5. AUTHORIZE OVERNIGHT TRAVEL FOR MARKETING MANAGER TO ATTEND VIDCON IN ANAHEIM, CALIFORNIA, JUNE 18-21, 2025 6. APPROVE DEMAND REGISTERS DATED JANUARY 10, 17, AND 24, 2025 MOTION — A motion was made and seconded by Councilmembers Pena/Sanchez to approve the Consent Calendar as presented, with Item No. 2 adopting Ordinance No. 620, and Item No. 3 adopting Resolution No. 2025-003. Motion passed unanimously. BUSINESS SESSION 1. ADOPT RESOLUTION TO APPROVE THE CITY'S GENERAL FUND BALANCE AND RESERVES POLICY (Policy) [RESOLUTION NO. 2025-004] Principal Management Analyst Hallick presented the staff report, which is on file in the Clerk's Office. Council discussed La Quinta is one of three Coachella Valley cities, alongside Indian Wells and Rancho Mirage, that have had their pension liability 100% funded at a certain point in time; the significant savings realized from the additional discretionary payments made proactively towards the City's unfunded pension liability instead of amortizing it over 20 years; adding the pension liability trust to the Policy as a restricted fund dedicated specifically for any pension funding, not a reserves category; Council has discretion on whether to fund the reserve categories and pension trust up to recommended targets per the Policy or not if there are conflicting priorities. CITY COUNCIL MINUTES Page 4 of 8 FEBRUARY 4, 2025 MOTION — A motion was made and seconded by Councilmembers Pena/McGarrey to adopt Resolution No. 2025-004 approving the City's General Fund Balance and Reserves Policy as presented. Motion passed unanimously. 2. APPROVE SECOND ROUND OF COMMUNITY SERVICES GRANTS FOR FISCAL YEAR 2024/25 Senior Management Analyst Calderon presented the staff report, which is on file in the Clerk's Office. MAYOR PRO TEM McGARREY SAID SHE SERVES AS A VOLUNTEER ON THE BOARD OF THE FRIENDS OF THE DESERT MOUNTAINS NON-PROFIT ORGANIZATION AND DOES NOT RECEIVE A STIPEND; THUS, THERE IS NO CONFLICT OF INTEREST WITH HER PARTICIPATION IN THE DISCUSSION AND VOTE ON THIS ITEM City Attorney Ihrke reiterated Mayor Pro Tem McGarrey's announcement that there is no potential conflict of interest related to her volunteer position with the Friends of the Desert Mountains as she does not receive any compensation, and in accordance with Government Code Section 1091.5. Staff noted the Ad -hoc committee for this round of grant applications review was comprised of Mayor Pro Tem McGarrey and Councilmember Fitzpatrick. Council discussed the importance and benefits of the survey data HARC, Inc. provides regionally for the Coachella Valley; and expressed general support to amend the recommended grant funding for HARC, Inc. to the maximum amount of $5,000. The following PUBLIC SPEAKERS, listed in the order in which they spoke, provided an overview of the objectives, services, and programs their respective organizations offer to the community: • HARC, Inc. — Jenna LeComte-Hinely, Chief Executive Officer — provided details on the various agencies and organizations using HARC's survey data to gauge the need of assistance and programs in the areas they service, and the number of La Quinta residents that have benefitted; and requested Council reconsider and award grant funding HARC. • Coachella Valley Horse Rescue — Grant Writer Volunteer Brenda Vatland, Special Events Director Aimee Moscoe, and Volunteer and Treasurer Kim Gehl — distributed a flyer summarizing the objectives and activities of the "Horsinalities 101 Youth Camp," a 3-day weekend camp scheduled for Spring of 2025, which was included in the public record of this meetings under WRITTEN PUBLIC COMMENTS; and provided information about the ranch's history, program's mission, volunteer program, and youth and veterans' services, and the objective of the grant is to offer a 3-day youth camp during Spring break; aiding horses and horse owners adversely impacted by the wildfires in the Los Angeles and Ventura Counties areas; and CITY COUNCIL MINUTES Page 5 of 8 FEBRUARY 4, 2025 volunteer opportunities are available at https://cvhorserescue.org and an open house coming up with details to be announced in the near future on the website. • United Cerebral Palsy of the Inland Empire — Rebecca Rizzo, Director of Donor Development — expressed the organization's gratitude for the starter grant award. • Desert Recreation Foundation — Yeilin Padilla, Management Analyst — expressed the organization's gratitude for the ad-hoc's committee recommendation to award grant funding for the on -site pilot program of adventure pool day programs for seniors and individuals with disabilities at Washington Street Apartment in collaboration with the City and the Coachella Valley Housing Coalition. • Riverside County Sheriff Explorer Post 503 — Lieutenant Randy Vasquez with Riverside County Sheriff's Department, Thermal Station, and explorers Melanie Flores and Sonya Garcia — said the Explorer program is part of the Boys Scouts of America since around the 1930s, and the Sherrif's department has had the Explorer volunteer program for approximately 50 years, for young adults from 14 to 20 years old, with its primary mission to educate and mentor youth and provide in-depth firsthand experience in the field of law enforcement. MOTION — A motion was made and seconded by Councilmembers Pena/McGarrey to approve second round Community Services Grants for fiscal year 2024/25 as detailed below, and amended to include $5,000 grant funding for HARC, Inc., for a total combined grant funding of $29,000 as follows: • Angel View $3,500 • Coachella Valley Horse Rescue $5,000 • Desert Recreation Foundation $5,000 • Friends of the Desert Mountains $5,000 • HARC, Inc. $5,000 • Riverside County Sheriff Explorer Post 503 $5,000 • United Cerebral Palsy of the Inland Empire $ 500 (starter grant) Motion passed unanimously. City Clerk Radeva said WRITTEN PUBLIC COMMENTS for Business Session Item No. 2 were received from Executive Director Kraig Johnson with Jewish Family Services of the Desert in support of the data services provided by HARC, Inc., and requesting La Quinta award grant funding to HARC, which were distributed to Council, made public, published on the City's website, and included in the public record of this meeting. 3. APPROVE AMENDMENT NO. 1 TO AGREEMENT FOR CONTRACT SERVICES WITH HAMMEL, GREEN AND ABRAHAMSON (HGA) FOR ADDITIONAL FINAL DESIGN WORK FOR CULTURAL CAMPUS PROJECT NO. 2019-01 Public Works Director and City Engineer McKinney presented the staff report, which is on file in the Clerk's Office. CITY COUNCIL MINUTES Page 6 of 8 FEBRUARY 4, 2025 APPLICANT'S REPRESENTATIVE: Benjamin Arcia, Senior Associate with McCullough Landscape Architecture, Inc. — said the design group sought to connect the design elements with the cultural significance of the Cahuilla Tribe and regional environment captured in the proposed Plaza Snake design. PUBLIC SPEAKER: Linda Williams, President of the La Quinta Historical Society, and La Quinta resident — said she is in favor of the proposed designs and expressed support for the preservation of the historic Lumberyard building. City Clerk Radeva said WRITTEN PUBLIC COMMENTS were received from the La Quinta residents listed below, in alphabetical order, in support of preserving the Lumberyard building as part of the Cultural Campus project, which were distributed to Council, made public, published on the City's website, and included in the public record of this meeting: • Edward Armendarez • David Heckman • Michael (Mike) Bebb • Cheryl Heineman • William (Bill) Borders • Sue Hertzog • Anita Broady • Jeanine Hill • Llora Cassel • Anne O'Brien • Michael Chanco and Michael Paganelli • Pete Schwartz • Christa Christopherson • Robbi Simons • Colin and Krista Ducey • Eileen Walsh • Jay Earl • Kay Wolff • Michael Hayes PUBLIC SPEAKER: Kim Richards, La Quinta Museum staff — provided historical background of the Lumberyard building; and expressed support for preserving the historical Lumberyard building. PUBLIC SPEAKER: Sharla Fox, La Quinta Museum Director — said she is in favor of the proposed designs and expressed support for the preservation of the historic Lumberyard building. Council discussed the anticipated construction costs of the proposed additional design scope; the importance of preserving the historic Lumberyard building based on the findings of the seismic and structural evaluation report commissioned by Council to ensure the building's structural integrity, functionality, and repairs would be feasible; appreciation of the proposed designs implementation of cultural significance symbolizing the region's heritage and natural environment; the desire for the Arts and Community Services Commission to make recommendations on the art for the Cultural Campus project; and options to salvage, restore, and/or relocate the Bird Song mural by artist Nate Frizell. MOTION — A motion was made and seconded by Councilmembers Sanchez/Fitzpatrick to approve Amendment No. 1 to Agreement for Contract Services with Hammel, Green, and Abrahamson for additional final design work for the Cultural Campus Project No. CITY COUNCIL MINUTES Page 7 of 8 FEBRUARY 4, 2025 2019-01, and to authorize the City Manager to execute the amendment. Motion passed unanimously. STUDY SESSION — None PUBLIC HEARINGS — None DEPARTMENTAL REPORTS — All reports are on file in the City Clerk's Office. MAYOR'S AND COUNCIL MEMBERS' ITEMS Councilmembers reported on their respective attendance at the Vista Santa Rosa Community Council meeting and the Kennedy Store refurbishment that was presented; Riverside County Office of Education Student of the Month celebration; Dunkin Donut ribbon cutting ceremony; Social Club mixer at Kiki's restaurant; Coachella Valley Firebirds ice logo installation; Chuckwalla National Monument designation celebration in the City of Mecca; and Legislative Breakfast with Senator Ochoa Bogh. REPORTS AND INFORMATIONAL ITEMS La Quinta's representative for 2025, Mayor Evans reported on her participation in the following organization's meeting: • VISIT GREATER PALM SPRINGS CONVENTION AND VISITORS BUREAU La Quinta's representative for 2025, Councilmember Fitzpatrick reported on her participation in the following organizations' meetings: • CVAG TRANSPORTATION COMMITTEE • RIVERSIDE COUNTY TRANSPORTATION COMMISSION (RCTC) La Quinta's representative for 2025, Mayor Pro Tem McGarrey reported on her participation in the following organization's meeting: • LEAGUE OF CALIFORNIA CITIES — ENVIRONMENTAL QUALITY POLICY COMMITTEE ADJOURNMENT There being no further business, a motion was made and seconded by Councilmembers Pena/Sanchez to adjourn at 5:47 p.m. Motion passed unanimously. Respectfully submitted, MONIKA RADEVA, City Clerk City of La Quinta, California CITY COUNCIL MINUTES Page 8 of 8 FEBRUARY 4, 2025