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2001-02-07 ARRA MinutesAPPROVED MINUTES OF THE REGULAR MEETING OF THE 2-A_ ALAMEDA REUSE AND REDEVELOPMENT AUTHORITY Wednesday, February 7, 2001 The meeting convened at 5:40 p.m. with Chair Appezzato presiding. 1. ROLL CALL Present: Albert DeWitt, Councilmember, City of Alameda Beverly Johnson, Councilmember, City of Alameda Barbara Kerr, Councilmember, City of Alameda Tony Daysog, Councilmember, City of Alameda Absent: Ralph Appezzato, Mayor, City of Alameda 2. CONSENT CALENDAR 2 -A. Approval of the minutes of the regular meeting of January 3, 2001. Member Kerr moved approval of the minutes. The motion was seconded by Member Johnson and passed by the following voice vote: Ayes -3; Noes -0; Abstentions -0 (Member Daysog arrived after the vote). 2 -13. Report and recommendation from the Finance Director to approve the annual audit for fiscal year 1999 -2000. Vice -Chair DeWitt asked if the deposits are being done in a timely manner, per the auditors Internal Control Memorandum? Zenda James, Finance Director stated that the Internal Control finding is correct and the contractor is now depositing the rental receipts on a timely basis. Member Kerr asked if the certificates of participation are being paid for as part of the long term debts? Ms. James responded that is correct because the debt service is pre - funded until year 2002. 1 Member Kerr asked what is the payment of $409,000 shown in 2001? Ms. James stated that the $409,000 is the principal and would be paid out of the bond proceeds. Vice -Chair DeWitt asked about the $1,272,422 and whether or not it indicates a loss or debt? Ms. James responded that we have expended more than current revenues for the year, however there are capital fiend projects that are drawn from the bond proceeds. David Berger, Assistant City Manager, C &ED stated that this action was pursuant to policy direction from the Board in May 1999, when the Board accepted the five -year financial plan. The bonds were issued pursuant to the financial plan and there was a transfer of bond proceeds to the City -wide capital projects in last fiscal year. Member Daysog commented about a fiscal report he received last October 2000 regarding revenues versus expenditures and asked what are the current year expenses exceeding revenues? Assistant City Manager Berger responded that the report does not reflect the ongoing cost of operating, protecting and maintaining the property and the ongoing revenues that have come out of ARRA leases. However, the current year shortfall has been covered by fiend balance. Member Johnson asked what is the projection date for the break even year since the bond financing was approved? Assistant City Manager Berger responded that staff is working on an updated financial plan, which they will bring to the Board with updated strategies due to a change of conditions. Things will not change significantly until there is a land transfer of the property and land sales. Member Kerr moved approval of the annual audit. The motion was seconded by Member Johnson and passed by the following voice vote: Ayes -4; Noes -0; Abstentions -0. 3. ACTION ITEMS 3 -A. Report from the Development Services Director recommending the approval of a lease amendment with the Alameda Point Collaborative for a portion of Building 92 to include the special purpose industry use of special events job training. Member Johnson asked when the Alameda Point Collaborative relinquishes entitlement, will it come back to the ARRA on Building 91? Assistant City Attorney Terri Highsmith responded that is correct. 2 The public hearing was opened. Wayne Ernstrom, Department of Veterans Affairs and DaVinci Fusion stated that he is experienced with the problems associated with the care and services to the homeless of the community. It is necessary to have access to job training programs capable of leading to meaningful employment at salary levels with which individuals can afford to live at with dignity. DaVinci Fusion's proposal to partner with other groups serving the homeless offer that appropriate service. Mr. Ernstrom expressed his strong endorsement of this proposal. Solomon Rosensweig, DaVinci Fusion stated DaVinci Fusion is a special event production company providing services in lighting, staging and all manners of theatrical goods and services to private, public and corporate industry. This is a good opportunity for DaVinci Fusion to provide assistance to the veterans community by providing training, job guidance and an income. This type of industry can accept the formerly homeless. Part of the program will include a network to provide jobs for the trained individuals to work for other companies. Ted Chapler, Alameda Point Collaborative asked for approval of the amendment as it is a fulfillment of the special purpose industry use for Building 92. DaVinci Fusion will provide a unique employment training and opportunity for the targeted population at Alameda Point. Jim Franz, Alameda Point Collaborative expressed his support of granting the change of lease to the Alameda Point Collaborative for DaVinci Fusion. This will provide job training and employment opportunities to formerly homeless veterans and other homeless individuals of the community. This will be a great benefit to the community. The public hearing was closed for Authority discussion. Member Johnson asked how many students will DaVinci have in the program after one year? Mr. Rosensweig stated they hope to provide training for 30 to 60 individuals a year. Member Johnson asked will the jobs be in this area or after the students complete the training, will they travel to other areas to secure their jobs? Mr. Rosensweig responded that they work all over Northern California, from Sacramento to Monterey. They transport workers to a job site to do a job and bring them back home. Wherever there is a show, they travel to. Most companies are based in this area. 3 Member Johnson asked what is the salary range for these types of jobs? Mr. Rosensweig responded that starting salary depends on skill level, which ranges from $25,000 to $85,000 per year. Member Daysog asked if the businesses they work for are event - production or event - production and job training? Mr. Rosensweig responded that they are primarily event - production. Member Daysog asked how many years have they been involved in job training? Mr. Rosensweig responded that they have seven hundred (700) individuals on their payroll who have learned on the job training. The company is not a non - profit organization. Member Daysog asked what experience do they have in delivering social services training? Mr. Rosensweig responded they are not delivering social services. They are providing job training to learn the skills and socialization necessary to secure a job and a job at the end of the training process. Member Johnson asked how long is the training program? Mr. Rosensweig responded that it depends on what the job skill level requires. If someone comes with background experience they may by -pass the training altogether and be placed in a job, as opposed to someone with no training. The purpose in the end is to get them work. Member Johnson asked is their program limited to Collaborative residence? Mr. Rosensweig replied that it is not limited solely to veterans. It is not a public funded agency, therefore they would like to provide training for people to get them off of the street. Member Johnson asked will they be residence of the Collaborative? Mr. Rosensweig responded they may or may not. The clients are referred to DaVinci Fusion by a screening through the Collaborative. Candidates not screened by the 12 Collaborative will not be accepted. Member Johnson asked what other job training programs are available at the Collaborative? Jack Shepherd, Alameda Point Collaborative responded that the Collaborative has a Service Coordinator who will have a Employment Coordinator, separate from DaVinci Fusion. They will work with the one -stop center and other in terms of occupational training for people. The people who come to DaVinci Fusion will have already been screened through the Collaborative. DaVinci Fusion is only one of the channels where they can go. There will be job training classes separate form DaVinci Fusion. Member Johnson asked is there something in our lease agreement that we have ongoing oversight over this and if the Board is not convinced that enough Collaborative residents are not part of this program that the Board can review this on an ongoing basis? Nanette Banks, Business and Special Project Manager responded that currently no where in the interim lease nor in the legally binding agreement does the City have a role in the operations of Collaborative programs. The City's role is to ensure compliance with use of the facilities and that the use does not disrupt the other uses outside of the Collaborative for management and upkeep of their property. The Collaborative does not have benchmarks they have to meet for the City for their program. Vice -Chair DeWitt asked the if the recommendation today is to allow the Collaborative to change the use of a portion of the building and if they have brought along DaVinci Fusion to show what type of training will take place in the building? Ms. Banks responded that is correct. Member Kerr asked Attorney Highsmith if the buildings must be used for the homeless? Attorney Highsmith responded that is correct. All of the benefits are to be used to directly or indirectly benefit that population of the formerly homeless. The Collaborative has an interim lease over Building 92 for warehouse purposes. They are allowed, with the Board's permission, to sublease portions of Building 92 for uses that are consistent with that warehouse purpose. The decision before the Board tonight is whether to approve the Collaborative's desire to sublease a portion of Building 92 for warehouse purposes to DaVinci Fusion and allow the Collaborative to use its special opportunity in Building 92 for a job training program. 5 Member Daysog moved approval of the recommendation with the condition that it meets the requirements of the federal law which benefits the formerly homeless Collaborative population. The motion was seconded by Member Johnson and passed by the following voice vote: Ayes - 4; Noes - 0; Abstentions - 0. 3 -B. Review of report by the Development Services Director regarding "rent subsidies" for the Hornet Foundation and Alameda Center for Environmental Technologies (ACET) (requested by Boardmember Kerr; information item only - -no action to be taken). Member Kerr stated that she brought this item onto the agenda because the expenses are exceeding the revenue at Alameda Point and the Board did borrow money for these expenses. The public hearing was open. Jerry Lutz, Aircraft Carrier Hornet Foundation stated the foundation has reduced its indebtedness by over $400,000, profit and loss is positive and they have successfiilly developed a series of new products and programs, such as the big band dance series, the live - aborad program and commercial and community conferences and events. School programs, group tours and aircraft have also been added to the organization. The Hornet will have a positive impact on the reuse of the former Naval Air Station as the media exposure increases at Alameda Point. The public hearing was closed for Authority discussion. Member Johnson expressed her appreciation of having the Hornet at Alameda Point and that it is a valuable asset to the community. Member Kerr asked Mr. Lutz how far they are behind on their current rent? Mr. Lutz responded that they are eight (8) months behind on everything with all of their creditors, including rent to the City of Alameda. Member Kerr asked has the organization thought of relocating to San Francisco to secure their financial fiiture? Mr. Lutz responded that they are not considering relocating to San Francisco because it is important to preserve this part of history in Alameda and they can make this a viable business within the City. Member Johnson expressed that it would be a tragedy to loose the Hornet and hopes that the organization will remain in Alameda. 9 Mr. Lutz responded that they hope to remain in Alameda permanently. 3 -C. Review of report by the Development Services Director on the status of efforts by the Alameda Naval Air Museum Board of Directors to raise constriction fiends required to improve and occupy Hangar 41 (requested by Boardmember Kerr; information item only - -no action to be taken). The public hearing was open. Kurt Bohan, 344 Westline Drive expressed his support for allowing the museum to pursue their efforts of upgrading Hangar 41. On Tuesday, February 6, 2001 there was a major walls through incorporating representatives from the federal government who assured there would be fiunding from the federal level via EDA money and no additional fiends would be required of the City. The City would have to show its support and request that this fiunding take place, which would be a partnership with ANAM. Marilyn York, President ANAM asked the Board to continue to endorse and show their support of this unique project. Ms. York stated they have done extensive work to some of the upgrades required to obtain a Certificate of Occupancy for the building and have been informed that they will receive federal fiunding to complete the necessary upgrades. Barbara Baack, ANAM expressed to the Board that they have worked hard to save this part of the history of the Alameda Naval Air Station. With support for federal fiunding, they believe they are within reach of completing the project. Ms. Baack asked the Board to extend the lease for Hangar 41 and to continue to support their efforts. Member Daysog asked Attorney Highsmith if the City is conveying the property or lease hold interest? Attorney Highsmith respond that is correct, it is just a lease agreement. Once the Navy transfers the property it will be either ARRA or City of Alameda property. Member Kerr stated that in the letter from Ms. York there is an assumption that the City has ownership of the property but there has been no title transfer as of yet. Richard Neveln, 1328 Park Street stated that since some of the upgrades of this building have been done, it would be foolish on the part of the City to not support it. Mr. Neveln expressed his support of this museum, as it will preserve 50 years of naval aviation history and those who served at Alameda Point. Mr. Neveln asked the Board to continue to support this project. 7 Stephen Keachie, ANAM stated that during the second half of 2000, they had expected to carry out the fire sprinkler and alarm upgrades which comprise the major expense for preparing the hangar for occupancy. The promised $200,000 from Mr. Keachie and his mother for this work remains fully available to the museum. However, after the trial sublease was written for only one year, its termination would leave the museum unprotected against the outright forfeiture to the ARRA of this substantial good faith expenditure. Mr. Keachie is asking the Board to extend the lease for five (5) years per the sublease agreement which shows that ANAM has firm commitments for the necessary building upgrades. The public hearing was closed for Authority discussion. Member Kerr requested Assistant City Manager Berger to direct his staff to respond and provide an information report to the February 6, 2001 letter from Marilyn York, ANAM President, specifically their lease extension request and endorsement of their project so they would receive federal funding. Assistant City Manager Berger responded that they will. Member Johnson asked whether the $200,000 from the Keachie's is a donation or security loan? Mr. Keachie responded that it is a unsecured loan which they will provide to ANAM and no collateral is required. They would prefer to offer the $200,000 as collateral against a low cost loan provided by the foundation or another organization which assists non - profits. Mr. Keachie stated they will loan the $200,000 directly with no collateral or security deposits required. The museum will pay back when they can and if they cannot, the loan will turn into a grant. Member Johnson asked if the upgrade costs to Building 41 are consistent with staff estimate for the total costs? Assistant City Manger Berger responded that during the walls through of Building 41 on February 6, 2001, Sandre Swanson nor did any EDA staff comment on providing funding to ANAM for the remainder of the building upgrade costs. Marilyn York, ANAM responded that they were told by Sandre Swanson that EDA representatives would provide them with full funding for the necessary upgrades. The funding would occur during the federal government's fiscal year, beginning October 1, 2001. Member Daysog asked Ms. York would it be a grant or loan from EDA and if it is a grant, what is the required local match? Ms. York responded that it would be a grant and the local match would be provided from the City of Alameda. 9 Assistant City Manager Berger responded there was a letter issued to Ms. Baack on January 12, 2000 from him indicating that provided all of the fiends staff estimated needed to upgrade the building and donated labor was in evidence to the City, there would be a $100,000 challenge grant offered to ANAM to carryout their objectives. The City Manager authorized the release of this letter. Vice -Chair DeWitt asked has the two items listed in the January 12, 2000 letter to Ms. Baack been completed, including the permits to upgrade Buildings 41 and 77; and has ANAM submitted written evidence of firm commitments for funding and /or pro bono work to cover the cost of all building upgrades? Ms. York responded that the lease does not expire until April 15, 2001. ANAM has obtained permits which expires April 8, 2001. Assistant City Manager Berger stated staff will provide the Board with a report indicating whether or not they have obtained building permits. ANAM has not provided written evidence of firm and verifiable commitments for the necessary upgrades. Vice -Chair DeWitt stated that when this comes back to the Board as an Action Item, these issues will be critical in determining the viability of this project. Member Daysog stated this is valuable public property and the Board is only exercising their due diligence. The Board would like to know that ANAM has the organization to perform the tasks that any other organization would be required to prove. 4. ORAL REPORTS 4 -A. Oral report from APAC. None. 5. ORAL COMMUNICATIONS, NON - AGENDA (PUBLIC COMMENT) Richard Neveln, 1328 Park Street stated it is unfortunate that the museum project is being talked about in terms of dollars and lacks a discussion of what is good for the Base. The museum needs to move in the direction of supporting development on the property known as Alameda Point. Mr. Neveln urged the Board to support the historical elements of the property with things like the museum. Kurt Bohan, 344 Westline Drive stated he was disturbed by the lack of the historical aspect of the Base, during the first community forum regarding the Master Developer. 9 The applicants who responded to the RFQ had not been given any information regarding the preservation of the historical buildings at the Base. Mr. Bohan urged the Board to continue their support of the history of Alameda and support going forward with ANAM. 6. COMMUNICATIONS FROM THE GOVERNING BODY None. 7. ADJOURNMENT The meeting was adjourned at 7:20 p.m. Respectfully, Lucretia Akil ARRA Secretary 10