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2005-05-17 Joint CC CIC ARRA Minutes MINUTES OF THE SPECIAL JOINT CITY COUNCIL COMMUNITY IMPROVEMENT COMMISSION, AND ALAMEDA REUSE AND REDEVELOPMENT AUTHORITY TUESDAY- -MAY 17, 2005- -7:25 P.M. Mayor/Chair Johnson convened the Special Joint meeting at 7:35 p.m. Councilmember/Commissioner/Board Member deHaan led the Pledge of Allegiance. ROLL CALL - Present: Councilmembers / Commissioners / Board Members Daysog, deHaan, Gilmore, Matarrese and Mayor Johnson - 5. Absent: None. CONSENT CALENDAR Councilmember/Commissioner Matarrese moved approval of the Consent Calendar. Vice Mayor/Commissioner Gilmore seconded the motion, which carried by unanimous voice vote – 5. (05-226CC/05-024CIC) Minutes of the Special Joint City Council and Community Improvement Commission Meeting of May 3, 2005. Approved. (05-025CIC) Recommendation to approve an Amended Contract with Michael Stanton Architecture (MSA) by increasing the Contract amount an additional $40,000 for design review services for the proposed Civic Center Parking Garage Project. Accepted. (05-026CIC) Recommendation to receive and file revised Alameda West Strategic Retail Implementation recommendations. Received and filed. AGENDA ITEMS (05-027CIC) Recommendation to approve a First Amendment to an Acquisition Agreement by which the Community Improvement Commission acquired an Affordable Housing Covenant from the Alameda Reuse and Redevelopment Authority for thirty units of very low income housing at the Bachelor Officers’ Quarters located within the Alameda Point Improvement Project. Commissioner/Board Member deHaan moved approval of the staff recommendation. Special Joint Meeting Alameda City Council, Community Improvement Commission and Alameda Reuse and Redevelopment Authority May 17, 2005 1 Commissioner/Board Member Matarrese seconded the motion, which carried by unanimous voice vote – 5. (05-028CIC) Resolution No. 05-136, “Resolution of Necessity to Acquire Property by Eminent Domain for Redevelopment Purposes; Authorizing Commencement of Litigation to Acquire Property and for Order of Possession; Code of Civil Procedure Section 1245.235 et seq. (APN 071-0203-014 and APN 071-0203-015; 2315-2323 Central Avenue, Alameda, California – Alameda Theatre/Cineplex and Parking Structure.” Adopted. Lester Cabral, Tenant, stated that a lot of information has just been received; that he opposes the resolution until the tenants are notified about what is going on; that he understands an eviction notice might be forthcoming. Chair Johnson requested staff to meet with Mr. Cabral to answer his questions. In response to Commissioner deHaan’s question about the property Mr. Cabral is concerned about, Mr. Cabral responded Hair Shapers at 2321 Central Avenue. Lars Hansson, Park Street Business Association (PSBA) Board President, stated the PSBA Board supports the staff recommendation and urges adoption of the resolution; the resolution will springboard negotiations with the owner to allow reaching a fair market value within a short period of time. Duane Watson, PSBA Board Vice President, urged moving forward with the project. Robb Ratto, PSBA Executive Director, stated the project is important for PSBA and all of Alameda; the restoration of the historic theatre was identified as the number one priority in the downtown vision process; urged support of the staff recommendation; stated Video Maniacs has been successfully relocated with the assistance of Development Services. Daniel A. Muller, Attorney for Cocores Development Company, submitted a letter; stated the letter submitted includes five categories of objections to the Resolution of Necessity and right to take the property; the offer of $1.5 million recently submitted is less than half of the value that a qualified, MAI [Masters of the Appraisal Institute] appraiser provided 1½ years ago; said appraiser, Mike Dunn, was jointly retained by the City and Cocores and came up with a value of $3.7 million; the appraisal the City is Special Joint Meeting Alameda City Council, Community Improvement Commission and Alameda Reuse and Redevelopment Authority May 17, 2005 2 using is over a year old; for a jointly hired appraiser to come up with $3.7 million and the City to disregard the offer and use a year old appraisal that is less than half of the jointly appraised value is fundamentally flawed; secondly, the City has not followed the adopted owner participation rules required by law; the rules specify that the City will give preference to property owners within the project area, which has not occurred; the City allowed Cocores to jointly pay for an appraisal and took half of the $25,000 price for a feasibility study in 1996 that has been shelved; the City has been willing to take Cocores’s money in partnership, but has not continued to follow through with any owner participation rules; the third problem is that the City claims the justification for the public use of the project is remediation of blight; the area is not blighted; the blight findings are unfounded and not supported by the evidence; additionally, there is evidence that the outcome of the hearing is predetermined; news articles indicate the City has commissioned construction reports and studies and committed itself contractually towards the condemnation and project; the City is conducting a sham hearing and is committed to going forward with the project; requested adoption of the resolution be delayed for a couple of meetings to allow the City to re-engage Mr. Cocores on the fair market value issue; stated City staff offered $2.5 million to Mr. Cocores at one point and even offered $3 million if structured as $2 million upfront and $1 million over a period of years; similar negotiations could continue if the resolution is delayed; if not, the City will face a right to take challenge; good faith negotiations seem to have terminated but could be restarted; additional evidence of predetermination is the Disposition and Development Agreement (DDA) that has been entered into with a developer; although the DDA is carefully worded that the Commission is not committing itself to condemnation, the mere fact that a DDA has been executed with a developer suggests there is no longer a discussion with the owner; urged delaying action to resume good faith negotiations and avoid spending resources on unnecessary litigation; finally, there are fatal, fundamental problems with the mitigated negative declaration; deferral of some of the mitigation measures are impermissible under California Environmental Quality Act (CEQA); CalTrans raised problems, such as traffic impacts and impacts to certain intersections, that were not addressed; the City must comply with CEQA prior to adoption of the Resolution of Necessity; failure to comply with CEQA can create right to take challenges. Chair Johnson inquired whether the Commission could adopt the resolution and give direction to staff to continue negotiations, to which Legal Counsel responded in the affirmative. Special Joint Meeting Alameda City Council, Community Improvement Commission and Alameda Reuse and Redevelopment Authority May 17, 2005 3 The Development Services Director stated staff would continue to talk to the owner about acquiring the property; staff has attempted to talk to the owner and has not had success. Chair Johnson stated it appears the owner is now willing to talk and the City should enter into discussions if the owner is willing. The Development Services Director stated the City has been working on the project for many years; a Request for Proposals (RFP) for redevelopment of the project was sent to the owner in December 2000; the owner sent a letter in January 2001 which thanked the City for sending the RFP and stated: “the owner’s desire is to wholeheartedly endorse the City’s effort to locate a developer to redevelop the Alameda Theatre;” staff has been proceeding on said basis for sometime; the DDA does not pre-commit the condemnation action; staff has always intended and hoped to acquire the property amicably; noted the property owner did not object at the CEQA hearings or DDA adoption. Commissioner Matarrese requested staff to comment on the claim of defects in the appraisal. Legal Counsel responded the Commission’s action is not predicated on the joint appraisal; staff has full faith and confidence in the appraisal upon which the action is being based. Commissioner Matarrese stated the project is important; the City has an opportunity to save the Alameda Theatre; the City should continue negotiating with the owner. Commissioner Matarrese moved adoption of the resolution. Chair Johnson inquired whether Commissioner Matarrese would amend the motion to include approval of direction to continue negotiations. Commissioner Matarrese agreed to amend the motion to include direction to continue to negotiate [with Mr. Cocores]. Chair Johnson stated negotiations should continue if the owner is willing; the owner has indicated a willingness to continue to negotiate; the City hopes to resolve the matter by agreement; hopefully, the owner is sincere about being willing to negotiate. Commissioner Gilmore seconded the motion. Under discussion, Commissioner Daysog stated moving forward is in Special Joint Meeting Alameda City Council, Community Improvement Commission and Alameda Reuse and Redevelopment Authority May 17, 2005 4 the best interest of the City. Commissioner deHaan requested staff to clarify whether Hair Shapers received notification. The Development Services Director stated that on March 22, all the tenants were notified that the City made a bona fide offer to the owner; the City’s relocation and acquisition agents provided information to all of the tenants at that time; staff would ensure the tenant has all the facts. Commissioner deHaan stated that he supports the action to go forward to allow a common position to be reached. On the call for the question, the motion carried by unanimous voice vote – 5. ADJOURNMENT There being no further business, Mayor/Chair Johnson adjourned the Special Joint meeting at 8:02 p.m. Respectfully submitted, Lara Weisiger, City Clerk Secretary, Community Improvement Commission The agenda for this meeting was posted in accordance with the Brown Act. Special Joint Meeting Alameda City Council, Community Improvement Commission and Alameda Reuse and Redevelopment Authority May 17, 2005 5