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HomeMy WebLinkAbout2026 05 19 CC MinutesCITY COUNCIL MINUTES TUESDAY, MAY 19, 2026 CALL TO ORDER A regular meeting of the La Quinta City Council was called to order at 3:00 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 City Manager McMillen requested to pull Consent Calendar Item No. 4 related to approving a Community Card Customer Agreement with Yiftee, Inc. for economic development subsidy for small businesses in La Quinta for fiscal year 2026/27 and consider it as Business Session Item No. 2 on tonight's agenda. Council concurred. 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 2. CONFERENCE WITH LEGAL COUNSEL — EXISTING LITIGATION; PURSUANT TO PARAGRAPH (1) OF SUBDIVISION (d) OF GOVERNMENT CODE SECTION 54956.9; NAME OF CASE: CONSTRUCTION LOAN SERVICES II, LLC V. SILVERROCK DEVELOPMENT COMPANY, ET AL. (U.S. District Court, District of Delaware, CASE NO. 25-1342-CFC) 3. CONFERENCE WITH LEGAL COUNSEL — EXISTING LITIGATION; PURSUANT TO PARAGRAPH (1) OF SUBDIVISION (d) OF GOVERNMENT CODE SECTION 54956.9; CITY COUNCIL MINUTES Page 1 of 8 MAY 19, 2026 NAME OF CASE: CITY OF LA QUINTA V. SILVERROCK DEVELOPMENT COMPANY, ET AL. (RIVERSIDE COUNTY SUP. CT. CASE NO. CVPS2404750) 4. CONFERENCE WITH LEGAL COUNSEL — ANTICIPATED LITIGATION; INITIATION OF LITIGATION PURSUANT TO PARAGRAPH (4) OF SUBDIVISION (d) OF GOVERNMENT CODE SECTION 54956.9 (NUMBER OF CASES: 1) COUNCIL RECESSED THE OPEN SESSION PORTION OF THE MEETING AND MOVED INTO CLOSED SESSION AT 3:02 P.M. MAYOR EVANS RECONVENED THE OPEN SESSION PORTION OF THE CITY COUNCIL MEETING AT 4:03 P.M. WITH ALL MEMBERS PRESENT REPORT ON ACTION(S) TAKEN IN CLOSED SESSION: City Attorney Ihrke reported the following pursuant to Government Code section 54957.1 (Brown Act): • CLOSED SESSION ITEM NO. 1 — no reportable action; 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 LLC and its responsive affiliates as reported out for Closed Session Item No. 2 from the August 6, 2024, Council meeting. Mr. Ihrke noted that a summary of the bankruptcy proceedings status for SilverRock Development Company LLC and its affiliates will be provided under the Announcements, Presentations, and Written Communications section of the agenda, as Presentation Item No. 1. • CLOSED SESSION ITEM NO. 2 — no reportable action. • CLOSED SESSION ITEM NO. 3 — no reportable action. • CLOSED SESSION ITEM NO. 4 — pursuant to Government Code section 54957.1(a)(2), Council took the following action: MOTION — A motion was made and seconded by Councilmembers Pena/Fitzpatrick to authorize the City Attorney's office to initiate an action related to the anticipated litigation. Motion passed unanimously. Mr. Ihrke explained that while at this time the action, defendants, and other particulars do not need to be identified, once formal action has commenced, the action, defendants, and other particulars relating to the nature of the action would be disclosed to any person upon inquiry, unless to do so would jeopardize the City's ability to effectuate service of process on one or more unserved parties or to do so would jeopardize the ability to conclude any settlement negotiations to the City's advantage. CITY COUNCIL MINUTES Page 2 of 8 MAY 19, 2026 PLEDGE OF ALLEGIANCE Councilmember Sanchez led the audience in the Pledge of Allegiance. PUBLIC COMMENT ON MATTERS NOT ON THE AGENDA PUBLIC SPEAKER: Tom Brohard, La Quinta — thanked Council for the restriping on Highway 111; mentioned previous discussion on widening the sidewalk for pedestrians - cyclists -carts; and suggested the driveway exiting Rubio's be restricted to entrance only. City Manager McMillen provided details on the City's examination of that access and egress as well as discussions with Fire personnel and are considering options. City Clerk Radeva said WRITTEN PUBLIC COMMENTS were received from La Quinta resident Morgan Murmo requesting pedestrian crosswalk improvements at the Avenue 52 and Avenida Bermudas Roundabout leading to Fritz Burns Park, which were distributed to Council, made public, published on the City's website, and included in the public record of this meeting. ANNOUNCEMENTS, PRESENTATIONS AND WRITTEN COMMUNICATIONS 1. SILVERROCK (FORMERLY TALUS) DEVELOPMENT PROJECT — STATUS UPDATE City Attorney Ihrke said on August 5, 2024, SilverRock Development Company LLC and its affiliates (debtors), 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. A milestone for the case was accomplished with the December 9, 2025, sale of the debtors' 130+/- acre property, formerly known as the Talus project, to Turnbridge Equities (TBE) pursuant to the bankruptcy court's order authorizing the sale. Furthermore, TBE continues to move forward with the preliminary studies and property review, in furtherance of the Development Agreement and related agreements and reports that were approved by the City Council as part of the sale of the property and approval of TBE's project. Prior Announcements regarding the bankruptcy case are available on the City's website at www.Iaquintaca.gov/talus. Mr. Ihrke said, as previously summarized a couple meetings ago, the case in the Bankruptcy Court resumed with a "wind -down" process, in which the court has the matter of resolving the allocation and distribution to creditors of the Sale Proceeds from the sale of the debtors property to TBE, along with wrapping -up the proceedings in the Bankruptcy Court. In connection with that "wind -down" process, the Bankruptcy Court granted the debtors motion for an order (i) approving a Preliminary Combined Disclosure Statement and Chapter 11 Liquidation Plan (the "Plan") on an Interim Basis for Solicitation Purposes CITY COUNCIL MINUTES Page 3 of 8 MAY 19, 2026 Only; (ii) approving Solicitation and Voting Procedures for Creditors; and (iii) scheduling a combined Hearing for decisions to be made on the Plan. As that name implied, debtors' Solicitation Motion was a procedural step under Bankruptcy Law, teeing -up the Plan for creditors to approve or object to the proposed amounts and methodology of liquidating and allocating the net proceeds from the sale of debtors' former property to TBE, among other provisions. During that solicitation period, several key creditors objected to the proposed Plan. As a result of those objections, many of the parties in the bankruptcy case litigation propounded discovery, which is a method to obtain information or evidence, and served discovery requests on one another. As such, the debtors, City, and key creditors once again engaged in settlement discussions and agreed to a "Global Plan Settlement," which among multiple deal points, would amend for a second time the Combined Disclosure Statement and Chapter 11 Liquidation Plan (the "Second Amended Plan"), and will be considered by the Bankruptcy Court later this week. Notably, several contingencies are included in the Global Plan Settlement, including the requirement that the City Council must approve the final terms of any settlement, if the Second Amended Plan is approved by the Bankruptcy Court. The City Manager, Special Counsel, and the City Attorney's office will keep the Council informed as to progress and the status of this case. 2. PROCLAMATION IN RECOGNITION OF THE 57TH ANNUAL PROFESSIONAL MUNICIPAL CLERKS WEEK - MAY 3-9, 2026 Mayor Evans and Councilmembers presented a proclamation recognizing the 57th Annual Professional Municipal Clerks Week to the City Clerk's Department and thanked staff for their professionalism, dedication, and commitment to public service. 3. PROCLAMATION IN RECOGNITION OF LARRY BOHANNAN, A LEGENDARY GOLF JOURNALIST FOR THE COACHELLA VALLEY, AND CONGRATULATING HIM ON HIS RETIREMENT FROM THE DESERT SUN Mayor Evans presented a proclamation recognizing the 40-year career and accomplishment of Larry Bohannan as the area's legendary golf journalist for the Desert Sun newspaper. 4. PRESENTATION BY COLLEGE OF THE DESERT (COD) PARTNERSHIP AND COMMUNITY EDUCATION DIRECTOR VERONICA IZURIETA ON THE LANDSCAPING CERTIFICATION PROGRAM THROUGH COD, IN PARTNERSHIP WITH THE COACHELLA VALLEY ASSOCIATION OF GOVERNMENTS (CVAG) AND COACHELLA VALLEY WATER DISTRICT (CVWD) CITY COUNCIL MINUTES Page 4 of 8 MAY 19, 2026 PRESENTER: COD PaCE Director Izurieta provided a presentation regarding the Landscaping Certification program offered by COD in partnership with CVAG and CVWD, including the mission and purpose of the program, goals, subjects covered, bilingual instruction, types of participants, location, number of students, free to all, La Quinta being one of the cities that require this certification, and program is open to all interested. 5. PRESENTATION BY SUNLINE TRANSIT AGENCY CEO/GENERAL MANAGER MONA BABAUTA ON THE AGENCY'S RIDES REIMAGINED PROJECT — PHASE 2 PRESENTER: SunLine Transit Agency CEO/General Manager Babauta — announced that SunLine is conducting another survey; explained SunLine's Rides Reimagined project Phase 2 which is to develop service scenarios based on public input from Phase 1 surveys and public input forums; key findings from Phase 1 were provided along with two possible scenarios; public input will again be sought on the service scenarios developed. Council discussed changes to La Quinta's routes, and effect of gasoline prices on ridership. CONSENT CALENDAR 1. APPROVE COUNCIL SPECIAL MEETING MINUTES DATED MAY 1, 2026 2. APPROVE AMENDMENT NO. 1 TO AGREEMENT FOR CONTRACT SERVICES WITH ACTION PARK ALLIANCE FOR MANAGEMENT AND OPERATIONS OF THE LA QUINTA X-PARK 3. APPROVE AMENDMENT NO. 7 TO AB 2766 MEMORANDUM OF UNDERSTANDING WITH THE COACHELLA VALLEY ASSOCIATION OF GOVERNMENTS TO PROVIDE FUNDING FOR THE REGIONAL PM10 STREET SWEEPING PROGRAM 4. Pulled from Consent Calendar by staff and considered as Business Session Item No. 1 >» APPROVE COMMUNITY CARD CUSTOMER AG_rREEMEN H YIFTEE, INC FOR ECONOMIC DEVELOPMENT SUBSIDY FOR SMALL BUSINESSES IN , A QUINTA FOR FISCAL YEAR 226T`7 5. APPROVE PLANS, SPECIFICATIONS, AND ENGINEER'S ESTIMATE, AND ADVERTISE FOR BID THE CITYWIDE MISCELLANEOUS CONCRETE IMPROVEMENTS PROJECT NO. 2024-06 6. AUTHORIZE THE PUBLIC WORKS DEPARTMENT TO UTILIZE RED TERRA NURSERY TO PURCHASE UP TO $70,000 OF PLANT MATERIAL IN FISCAL YEAR 2025/26 7. RECEIVE AND FILE THIRD QUARTER FISCAL YEAR 2025/26 TREASURY REPORTS FOR JANUARY, FEBRUARY, ND MARCH 2026 CITY COUNCIL MINUTES Page 5 of 8 MAY 19, 2026 MOTION — A motion was made and seconded by Councilmembers Fitzpatrick/McGarrey to approve Consent Calendar Item Nos. 1-3 and 5-7, as presented. Motion passed unanimously. BUSINESS SESSION 1. Pulled from Consent Calendar by staff and considered as Business Session Item No. 1 »> APPROVE COMMUNITY CARD CUSTOMER AGREEMENT WITH YIFTEE, INC FOR ECONOMIC DEVELOPMENT SUBSIDY FOR SMALL BUSINESSES IN LA QUINTA FOR FISCAL YEAR 2026/27 City Manager McMillen presented the staff report, which is on file in the Clerk's Office. Council discussed that the subsidy is part of the Shop Local program and is totally digital; vendors are paid the same day; time frame for use; trial program for the summer months in the Coachella Valley; marketing plan for the program; definition of summer months; set up to be done by Yiftee, Inc.; City's limited ability by State law to subsidize local businesses; the financial benefit to the City revenues and City businesses of this program since the card funds must be spent within the City. MOTION — A motion was made and seconded by Councilmembers Pena/Fitzpatrick to approve Community Card Customer Agreement with Yiftee, Inc. for economic development subsidy for small businesses in La Quinta for fiscal year 2026/27; and authorize the City Manager to execute the agreement. Motion passed unanimously. STUDY SESSION 1. DISCUSS FISCAL YEAR 2026/27 PRELIMINARY PROPOSED BUDGET Finance Director Martinez presented the staff report, which is on file in the Clerk's Office. Council discussed unfunded pension liability payments; scoring and ranking of cities based on fiscal stability; transparency of the budget; development impact fees (DIF) payoff over the next fiscal year through the City's Capital Improvements Program; the City's fiscal year 2029-30 Recognized Obligation Payment Schedule (ROPS) payoff; Measure G funds; Financial Advisory Commission review and oversight; guidance from public workshops; results visible; and reinvestments in the City. Council reviewed the dates for future budget review meetings in May and June, with consideration of budget adoption scheduled for June 16, 2026, and had no additional directions for staff. PUBLIC HEARINGS — None DEPARTMENTAL REPORTS — All reports are on file in the City Clerk's Office. CITY COUNCIL MINUTES Page 6 of 8 MAY 19, 2026 MAYOR'S AND COUNCIL MEMBERS' ITEMS Councilmembers thanked staff for the restriping on the west end of Highway 111, for the additional trash receptacles in the Park, and the rattlesnake signs at the top of the Cove. Mayor Evans reported on her, and other Councilmembers' attendance at Read With Me at Truman Elementary School; CVlink Day — La Quinta's entry point and section; Concert - in -the -Park; Southern California Association of Governments (SCAG) conference; Jack Bouquin's 100th birthday; La Quinta High School IT Academy Senior Recognition event; Women Who Rule luncheon; Desert Sands Unified School District Chili Golf Tournament; Cathedral City State -of -the -City; Bruce Lee Memorial; Palm Springs Air Museum joint mixer; Harvey Milk diversity Breakfast; and Rotary Club's First Responder Recognition. Councilmember Pena reported on his attendance at the Contract Cities Gonzales Dinner. Councilmember Sanchez reported on his, and other Councilmembers' attendance at 29- PSP; and the Air Museum Learning Center. REPORTS AND INFORMATIONAL ITEMS La Quinta's representative for 2026, Mayor Evans reported on her participation in the following local, regional and State meeting(s): • CVAG COACHELLA VALLEY CONSERVATION COMMISSION La Quinta's representative for 2026, Mayor Pro Tem Fitzpatrick reported on her participation in the following local, regional and State meeting(s): • RIVERSIDE COUNTY TRANSPORTATION COMMISSION (RCTC) La Quinta's representative for 2026, Councilmember McGarrey reported on her participation in the following local, regional and State meeting(s): • COACHELLA VALLEY MOUNTAINS CONSERVANCY • DESERT RECREATION DISTRICT COMMITTEE (Fitzpatrick & McGarrey) • LEAGUE OF CALIFORNIA CITIES — EXECUTIVE COMMITTEE, RIVERSIDE COUNTY DIVISION La Quinta's representative for 2026, Councilmember Pena reported on his participation in the following local, regional and State meeting(s): • CV MOSQUITO AND VECTOR CONTROL DISTRICT BOARD OF TRUSTEES • CVAG PUBLIC SAFETY COMMITTEE La Quinta's representative for 2026, Councilmember Sanchez reported on his participation in the following local, regional and State meeting(s): • SOUTHERN CALIFORNIA ASSOCIATION OF GOVERNMENTS CITY COUNCIL MINUTES Page 7 of 8 MAY 19, 2026 ADJOURNMENT There being no further business, a motion was made and seconded by Councilmembers McGarrey/Fitzpatrick to adjourn at 6:04 p.m. Motion passed unanimously. Respectfully submitted, MONIKA RADEVA, City Clerk City of La Quinta, California CITY COUNCIL MINUTES Page 8 of 8 MAY 19, 2026