Loading...
HomeMy WebLinkAbout09/28/2004 - Regular MeetingCITY OF NEWPORT BEACH City Council Minutes Regular Meeting September 28, 2004 - 7:00 p.m. - Cancelled. CLOSED SESSION - Cancelled. INDEX A. RECESSED AND RECONVENED AT 7:00 P.M. FOR REGULAR MEETING B. ROLL CALL Present: Heffernan, Rosansky, Bromberg, Webb, Daigle, Nichols, Mayor Ridgeway Absent: None C. CLOSED SESSION REPORT - None. D. PLEDGE OF ALLEGIANCE - Council Member Daigle. E. INVOCATION - Mayor Ridgeway. F. PRESENTATIONS Presentation of plaques to outgoing Board and Commission members. Mayor Ridgeway reported that Walt Howald was on the Board of Library Trustees from July 1, 2000 to June 30, 2004 and presented Mr. Howald with a plaque. He added that he was also very instrumental in obtaining the library grant for the joint use project at Mariners Library. Mr. Howald thanked Council for their support on the project. Mayor Ridgeway reported that Lyn Belasco was on the City Arts Commission for eight years. Ms. Belasco indicated that the Concerts in the Park was her pride and joy, and that Shakespeare by the Sea extended from that. She stated that she was one of the founders of the Newport Beach Arts Foundation and will continue with the Arts Foundation. She added that she will miss working with the City and her fellow Commissioners. Friends of the Library Check Presentation. Barbara Day, President of the Friends of the Library, stated that they have over 800 members, of which, 100 work in the store every month. She added that they are open seven days a week, run four book sales a year, and process about 250,000 books a year. She reported that they are giving the library a check for $200,000. She added that they are also one of the beneficiaries of the Atkin Taylor Trust and have pledged $100,000 towards building the children's room in the Mariner's Library and $100,000 for construction costs and overruns. She thanked the people who donate books and the customers. She believed that they are one of the real jewels of the City. Volume 56 - Page 1230 City of Newport Beach City Council Minutes September 28, 2004 INDEX Harry Hamilton stated that, on behalf of the Board of Library Trustees, they gratefully accept the money. He stated that they are deeply grateful to the Friends of the Library for all their hard work and expressed appreciation to those that buy books. Corona del Mar Centennial. Peggy Fort, Executive Director of the Corona del Mar Centennial Foundation, invited the entire City to attend the Centennial Celebration. She announced that it will be held October 14 to October 17 and highlighted the events that will take place over the weekend. She stated that people can get more information by calling the Centennial Foundation at 675 -0501, visiting their website (www.cdm2004,com), or emailing them at info�cdm2004.com. She reported that they have a volunteer orientation meeting tomorrow at 6:00 p.m. at Sherman Gardens and a committee meeting on October 6. She displayed the centennial tile and reported that it can be purchased at Color Me Mine or people can contribute to the donor wall at the Centennial Plaza. G. NOTICE TO THE PUBLIC H. CITY COUNCIL ANNOUNCEMENTS OR MATTERS WHICH COUNCIL MEMBERS WOULD LIKE PLACED ON A FUTURE AGENDA FOR DISCUSSION. ACTION OR REPORT (NON- DISCUSSION ITEM): • Mayor Ridgeway introduced newly- appointed Council Member Daigle. • Council Member Heffernan announced that the Friends of the Library need more books. • Council Member Heffernan provided information regarding early voting in the County from October 5 to October 29. He stated that more information can be obtained by calling the City Clerk at 644 -3007. • Council Member Rosansky requested an update relative to the Santa Ana River dredging project. Assistant City Manager Kiff stated that the proposal would not use any trucks, but would store material at the mouth of the river and use a dredge to liquefy the material, and then place it in a pipe to go to the offshore disposal zone. • Council Member Rosansky stated that trucks that are painted with billboards are being parked in residential neighborhoods and are not being moved. He indicated that they are also parked in driveways, specifically at River and Balboa Boulevard. He requested a report about what the City can do about this. Acting City Attorney Clauson indicated that they are working on a way to regulate this through amendments to the sign code. She added that they are also looking at constitutional issues related to trucks with signs on them. She noted that the City only has provisions regarding parking on public streets. Mayor Pro Tem Bromberg reported that, at the last Council meeting, it was announced that the City arrived at a settlement with Irvine regarding the Scholle project in which the City will receive $396,000 for traffic mitigation measures at Jamboree and MacArthur. He credited staff and EQAC for their work in coming to this solution. Mayor Ridgeway clarified that the agreement for the money was with the Scholle proponents, not Volume 56 - Page 1231 City of Newport Beach City Council Minutes September 28, 2004 the City of Irvine. Mayor Pro Tem Bromberg noted that the City adopted the First Battalion First Marines from Camp Pendleton. He announced that, on October 26, there will be a "Mess Night" at the Balboa Bay Club for $200 per person. He stated that they expect to have a surplus of $20,000 to $30,000. He noted that the Marines will be going back to Iraq in December and that the surplus will be used to help their families. He stated that the cost of the tickets also pays for a Marine to attend the event. He indicated that tickets can be purchased by calling 644 -3202. Council Member Webb stated that Orange Coast College and the Sanitation District are looking at constructing a pedestrian bridge over Coast Highway. He noted that Caltrans has indicated to them that they would need to have input from the City. He asked that someone from Public Works work with the Sanitation District and Orange Coast College on the details. Council Member Webb stated that Council designated him to attend the League of California Cities Conference two weeks ago. He announced that the City was presented with the Helen Putnam Award for the Administrative Services Department Master Customer Identification Program. Council Member Webb also reported that the League is supporting Proposition IA to help protect local funding from the State and provided each Council Member with a Proposition 1A brochure. Council Member Nichols stated that Corona del Mar needs more sand, as does other communities further south. I. CONSENT CALENDAR READING OF MINUTESIORDINANCES AND RESOLUTIONS 1. MINUTES OF THE ADJOURNED REGULAR AND REGULAR MEETING OF SEPTEMBER 14, 2004. Waive reading of subject minutes, approve as written and order filed (Council Member Daigle abstained). 2. READING OF ORDINANCES AND RESOLUTIONS. Waive reading in full of all ordinances and resolutions under consideration, and direct City Clerk to read by title only. ORDINANCE FOR INTRODUCTION 3. TRAFFIC CONTROL ON VIA FIRENZE. Introduce Ordinance No. 2004 -22 amending Section 12.52.070 of the NBMC to designate Via Firenze between Via Lido Saud and Piazza Lido as one -way, northeast bound traffic only. ORDINANCES FOR ADOPTION 4. REVISION OF PARKING METER ZONE IN MARINERS VILLAGE. Adopt Ordinance No. 2004 -20 to amend Parking Meter Zone 2 in Volume 56 - Page 1232 INDEX (100 -2004) (100 -2004) City of Newport Beach City Council Minutes September 28, 2004 Municipal Code Section 12.44.020 to add the "Northerly side of Avon Street from Riverside Avenue to 150 feet westerly "; and to amend Section 12.44.040 to establish fees for parking meters on Avon Street. 5. Removed at the request of an audience member. RESOLUTIONS FOR ADOPTION 6. Removed at the request of Council Member Nichols. 7. Removed at the request of an audience member. S. Removed at the request of Council Member Webb. 9. Removed at the request of staff. 10. Removed at the request of staff. CONTRACTS AND AGREEMENTS 11. IRVINE AVENUE 24 -INCH WATER MAIN REPLACEMENT - APPROVAL OF PROFESSIONAL SERVICES AGREEMENT WITH TETTEMER & ASSOCIATES. Approve a Professional Services Agreement with Tettemer & Associates of Irvine for engineering services for the Irvine Avenue 24 -inch Water Main Replacement project at a contract price of $148,308 and authorize the Mayor and City Clerk to execute the agreement. 12. Removed at the request of Council Member Nichols. MISCELLANEOUS ACTIONS 13. Removed at the request of Council Member Nichols. 14. Removed at the request of Council Member Nichols. 15. BUDGET AMENDMENT TO ACCEPT A CHECK FROM THE FRIENDS OF THE NEWPORT BEACH LIBRARY AND APPROPRIATE FUNDS TO MAINTENANCE & OPERATIONS BUDGET ACCOUNTS FOR FY 2004/05. Approve a budget amendment (05BA -014) increasing revenue estimates by $93,000 in 4010 -5901, Private Donations /Contributions, and increasing maintenance and operations expenditure estimates by $93,000 in Division 4091, Friends. 16. ACCEPT FEMA SUPPLEMENTAL EMERGENCY OPERATIONS PLANNING GRANT. 1) Accept the 2002 Federal Emergency Management Agency Supplemental Emergency Operations Planning Grant for $11,283 in funding for emergency operations planning; and 2) approve a budget amendment (05BA -015) increasing revenue estimates by $11,283 in 2355 -4894, and appropriating those funds into Fire Department account 2355 - 82001. Volume 56 - Page 1233 INDEX C -3708 Irvine Avenue 24 -inch Water Main Replacement (38/100 -2004) (100 -2004) (100 -2004) City of Newport Beach City Council Minutes September 28, 2004 17. APPROVE PURCHASE OF PDSI TELESTAFF SOFTWARE. Approve the purchase of PDSI Telestaff software for a total not to exceed $93,870 (contract price of $85,338 + 10% contingency). 18. Removed at the request of Council Member Rosansky. Motion by Mayor Pro Tern Bromberg to approve the Consent Calendar, except for those items removed (5, 6, 7 8, 9, 10, 12, 13, 14 and 18), and noting the abstention on Item 1 by Council Member Daigle and the abstention on Items 9 and 10 by Council Member Rosansky. The motion carried by the following roll call vote: Ayes: Heffernan, Rosansky, Bromberg, Webb, Daigle, Nichols, Mayor Ridgeway Noes: None Abstain: None Absent: None J. PUBLIC COMMENTS Allan Beek apologized if his signs that he will be putting up, which say "Give Away Public Bayfront - L No ", offends anyone. Dolores Otting, Council candidate, noted that the pump station that is operated by the Sanitation District had a spill a few weeks ago and asked what happened to their backup system. She requested that Mayor Ridgeway, as a representative on the Sanitation District, find out what happened. She believed that the City should maintain or test the Sanitation District's generators. Mayor Ridgeway stated that a public report will probably be available in the next four weeks and reported that he will bring it to the meeting when it is available. He added that the newspapers will also receive the report. Tom Billings stated that the Irvine Family gifted the land years ago from the Balboa Bay Club to the Arches for public use, but most of it has been converted to commercial and private use. He reported that the City will soon be voting on Measure L to modify the General Plan to change Marinapark from Recreation and Environmental Open Space to Marine Commercial. He stated that, once this is done, the land can be developed and believed that another piece of public land is lost. He indicated that there is limited harbor front access and scarcity of open space on the bay, and the City is built out. He stated that no amount of the developer's money can change the fact that public parkland and open space must be preserved. He urged every voter to vote "no" on Measure L. Mark Tabbert stated that Mayor Ridgeway spoke about all the opportunities the public had to be a part of the GPAC process. He indicated that he wrote the Daily Pilot about a member of the public being roughly treated at a GPAC meeting he attended. He stated that he did not take offense to the Mayor's remarks, but added that he was pleased to hear his comments at the last meeting. He believed that the letters that appeared in the Daily Pilot after his letter and the Mayor's comments Volume 56 - Page 1234 INDEX C -3735 Telestaff Software (38/100 -2004) City of Newport Beach City Council Minutes September 28, 2004 INDEX prove that his letter touched a cord that the public's desire for a certain type of future is at odds with real estate, legal, and business interests as presented by GPAC. Mr. Tabbert presented and read a statement that he hoped all the Council Members and those running for Council will sign regarding the future of Banning Ranch. Mayor Ridgeway clarified that his comments were directed to another individual regarding the Local Coastal Plan (LCP) process, not GPAC or GPUC. • Pam Murray stated that she is a Marine Mom and suggested that the surplus money for the Marine families also be used to purchase web cams for the troops. Ms. Murray stated that she is a property owner that lives in close proximity to Marinapark. She indicated that she supports the proposed hotel and resort, and does not support a plan for an aquatic park, boat launch, and soccer and t -ball fields. She expressed concern about the noise, traffic, and parking issues that a park would bring, noting that traffic for a hotel runs opposite of beach traffic. She believed that a resort would be an asset to the area and will help propel the revitalization of the Peninsula. • Jan Vandersloot indicated that people who don't live on the Peninsula have trouble finding parking when they want to visit the beach or the bay. He believed that a park could provide up to 200 parking spaces. He stated that, if the City is to have public access to the beach and bay, it ought to maintain its Recreation and Environmental Open Space area. He stated that, if the voters vote "yes" on Measure L, it will only be available to a select few. However, a "no" vote will keep the land available to the citizens, their children, and their grandchildren no matter where they live. He urged the people of the City to keep the parkland and vote "no" on Measure L. • Rollin Sanders stated that he has been watching this issue on cable and wanted to be on record as being opposed to building a hotel at Marinapark. He believed that the land should be kept as open space to build a park because once it is given away, the City cannot get it back. Ann Watts stated that she is working with www.ocmil.com who is trying to reopen the base housing at El Toro for military families. She noted that the rent stipend sometimes does not cover the cost of rent, and when it does, there is very little for other expenses. She noted that over 1,000 units of base housing sit empty, but taxpayers continue to pay for them. She reported that Steve Rose of Tustin's Affordable Housing made an offer to the Department of Navy to buy the units, renovate them at no cost to the taxpayer, and rent them at below market rates to the troops. She added that Congressman Cox is also working with them. She suggested that people call the Congressman's office to let him know they support his effort to reopen E1 Toro base housing for our troops and encouraged Council to draft a resolution to send Congressman Cox. Volume 56 - Page 1235 City of Newport Beach City Council Minutes September 28, 2004 INDEX John Hedlund stated that he is a transplant from Glendale. He reported that he was active in Glendale city affairs, and was instrumental in forming the Glendale Partners to help the city look long range and to fund studies. He believed that, in order to have a vital city that responds to the needs of the community, it needs managed, intelligent growth. He indicated that he served on the redevelopment agency in Glendale and they would consider the Marinapark area a blighted area. He believed that a hotel would offer community rooms, improve the Girl Scout House, update the American Legion, and provide more parking. Tom Birch stated that he is a colleague of Mr. Hedlund's. He indicated that he saw a presentation by Mr. Sutherland and believed that his project would be an asset to the community since the hotel was low density and it provided an improved Girl Scout facility and increased parking. He noted that he is a member of American Legion Post 291 and stated that it also would get many benefits. He asked that people consider voting "yes" on Measure L. Don Regan stated that he has 16 grandchildren who have all slid down the slide at the tot lot, believing that they are the only 16 of maybe 30 people who have used it in the last three years. He believed that the project would upgrade the facility, add parking, be more usable to the community, and be good for the tax base. He stated that there is a large sentiment in the community for this type of use and facility on the property. John Buttolph, Council candidate, agreed that a park has no economic return but took issue that this is what it is coming down to. He asked if the City is about taking open space in order to maximize economic return. He stated that he realizes that cities need to make revenue, but this does not mean that government advocates its responsibility as stewards of public parkland. He urged voters to vote "no" on Measure L. Mayor Ridgeway pointed out that five acres is currently taken up by a mobilehome park. Laura Dietz noted that Council is also stewards of an entire community. She stated that she was initially hesitant about this project because of concerns she had for the American Legion, but noted that the Legion will benefit from this, a community center will be added, the hotel will bring in revenue, and the contiguous properties will probably spruce up which will increase property values. She encouraged people to support Measure L. She added that the City has an abundance of parkland, reporting that the City has the Back Bay, 32 parks, and two more that are coming onboard. She stated that the Coastal Commission would also agree with this. Joe Repus stated that Mr. Sutherland said at a Peninsula Point Homeowners Association meeting that he will spend up to $1.5 million to remodel the American Legion Hall and another $1.5 million for a 6,200 square foot combination community center, oasis center, and Girl Scout House. He indicated that Mr. Sutherland has State tax liens, IRS liens, and judgments, and asked how the City could give him a $100 million piece of property. He stated that Mr. Sutherland is not an architect, a designer, or a developer, and that no one has heard of Steve Sutherland. He believed that the City has lost close to $3 million to date on Volume 56 - Page 1236 City of Newport Beach City Council Minutes September 28, 2004 Marinapark. He stated that the Marinapark tenants would've been paying $1,529,000 a year and they offered to pay $1.7 million. He believed that, until the hotel goes through, the City will now be wasting $700,000 a year. K. ORAL REPORTS FROM CITY COUNCIL ON COMMITTEE ACTIVITIES Ad Hoc General Plan Update Committee (GPUC) — None. Local Coastal Program Certification Committee — None. Newport Coast Advisory Committee — Assistant City Manager Kiff reported that they met September 13 and will meet again on October 4 at 5:30 p.m. at the Newport Coast Elementary School. He stated that they've been working on the Newport Coast Community Center site design and this will come before Council for comments and approval. He added that they discussed the landscaping for Newport Coast Drive and the plan is currently in Public Works. Mr. Kiff stated that the Newport Coast Elementary School loop road was also discussed. Council Member Heffernan added that NCAC adopted a resolution to not divert construction traffic from Ridge Park Road so they could see how the loop road is working. He stated that they feel that the signalized intersection at the school is a better turning point for construction traffic. Further, the road is also wider than other road alternatives. Mariners Joint Use Library Ad Hoc Steering Committee — Public Works Director Badum reported that they are awaiting final approval from the State Library Board, but they are poised to award the contract in October or November. Aviation Committee — Mayor Pro Tem Bromberg announced that there will be a meeting on October 4 at 8:30 a.m. in the Friends Room at the Central Library. Telecommunications Committee — Council Member Heffernan reported that the committee met last week. He stated that they received an explanation from their outside counsel as to why the cable franchises are not likely to get extended. He reported that cell providers attended the meeting but would not provide examples of rent amounts. He stated that the City established a range and reported that there are eight pending cell contracts to consider. L. PLANNING COMMISSION AGENDA AND ORAL STATUS REPORT 19. PLANNING COMMISSION AGENDA FOR SEPTEMBER 23, 2004. Planning Director Temple reported that three items were continued. 'She noted that the Gates residence and St. Andrews Presbyterian Church items were continued without discussion. Regarding the condominium conversion and tentative tract map for a seven unit apartment project at 329 Marguerite Avenue, she indicated that the Commission requested new analysis and continued the item to October 7. Ms. Temple reported that the use permit for the Balboa Theater was approved with no testimony or comment. Volume 56 - Page 1237 INDEX (100 -2004) City of Newport Beach City Council Minutes September 28, 2004 Ms. Temple reported that the Commission recommended approval to the City Council of the general plan amendment, zoning amendment, use permit, traffic study, and environmental document for St. Mark Presbyterian Church. She stated that this will be brought before Council at the October 12 meeting. In response to Council Member Nichols' question, Ms. Temple confirmed that there are seven apartments at 329 Marguerite Avenue that will be converted to condominiums. She clarified that the City allows conversions for any multi - family project. M. CURRENT BUSINESS 20. MARINAPARK RESORT & COMMUNITY PLAN — MEMORANDUM OF UNDERSTANDING (MOU) — TERM SHEET. Contract Attorney Burnham reported that Kim Thompson of Rutan & Tucker who is the special real estate counsel is in attendance to answer questions, but Economic Advisor Cal Hollis is not present tonight. Mr. Burnham stated that Council appointed a subcommittee consisting of Mayor Ridgeway and Council Member Heffernan to talk with the Marinapark proponent about possible lease terms and conditions so the voters could be informed of the terms prior to the election; and to also determine whether the revenue generated through the lease terms and conditions would be comparable to the forecast in the fiscal impact report. He indicated that an MOU and a draft of the term sheet are included that represent the status of those discussions and a summary of the issues. He pointed out that there was no conceptual agreement on a number of issues, including the amount and timing of option considerations, the method by which the City would insure that it had no obligation to provide services or amenities to the timeshare owners in the event the property went into default, and the manner and amount of the percentage of rent the City would receive from the fractional units. Mr. Burnham reported that they drafted an MOU but walked the fence between not wanting to commit the City to a particular term or condition, and giving the voters a level of comfort or confidence that they could rely on these terms and conditions if they were to vote on this project. He stated that most of the discussion relative to the fiscal analysis included the base rent and the in lieu Transient Occupancy Tax (TOT) that the City would receive from the fractional units and the TOT that the resort would generate. Mayor Ridgeway noted that the lease does not provide for the standard return of property taxes and /or TOT. Mr. Burnham confirmed that, except for the supplemental rent, these terms are above and beyond what would represent the in lieu hotel tax. Beside the vote on November 2, he stated that staff and special counsel acknowledge that there are a number of issues that need to be resolved before any agreement is signed, including clarification that Mr. Talla has withdrawn, the nature of the entity that remains, and the identity of the financial partners that need to be brought on board. Volume 56 - Page 1238 INDEX C -3389 Marinapark (38/100 -2004) City of Newport Beach City Council Minutes September 28, 2004 INDEX Mayor Pro Tem Bromberg noted that MOUs usually don't deal with leases. He asked what the MOU gives Mr. Sutherland if the Mayor signs the document. He further asked if the City is bound to deal with Mr. Sutherland if the measure passes. Mr. Burnham indicated that, in his opinion, the City is not bound to deal with him if the measure passes. However, the MOU does not clarify that issue, believing that it may be appropriate for the MOU to acknowledge that currently there is some question as to what Mr. Sutherland's rights are vis -a -vis the City and the City's obligations to Mr. Sutherland and STH, the entity the 2000 and 2003 agreements were signed with. He reported that he asked Mr. Thompson to look into those questions and that they are not comfortable giving an opinion on any of those issues right now. He indicated, however, that the MOU would commit the City to use as a basis for further discussions, the $1.1 million in annual rent. He noted that Mr. Hollis has indicated that this is fair market rent for this property given the use and other provisions outlined in the staff report. He. stated that the items in the term sheet that represent contractual commitments work to benefit the City. Mayor Pro Tem Bromberg stated that, if Measure L is approved in November and the City chooses not to do business with the developer, he wants to be sure that the City is not locked into something in the event those contingencies occur. Mr. Burnham noted that Council entered into an exclusive negotiating agreement in 2000 and 2003 with Sutherland Talla Hospitality after a lengthy request for proposal (RFP) process. However, since that time, there have been changes in the nature of the entity. He reiterated that Mr. Thompson is not comfortable telling Council what the rights and duties are with respect to the City and Mr. Sutherland. He stated that, if this is approved by the voters, Council needs to have a comfort level that the people they are dealing with are of good moral character, have the financial ability to construct the entire project including the community center and all the public improvements, and the ability to operate the resort as a luxury resort. He indicated that this type of protection comes first from making sure that the people with whom you are dealing with are capable in all of those respects. Further, this can be achieved through negotiations of the terms and conditions of the option. He reported that, the way the term sheet is set up, the option cannot be exercised until Council has received evidence that there is a construction loan, a contract with a luxury resort manager or a luxury resort manager owns the facility, and other levels of protection to ensure that this resort will be constructed as it has been presented with appropriate materials and finishes, and it will be operated in a way that is a credit to the community. Mr.. Burnham stated that those levels of protection exist in the term sheet and they would be included in the option agreement that is subject to Council approval. He emphasized that, when the MOU was drafted, it was an attempt to walk the line between giving the voters a level of confidence that these were terms and conditions they could rely on without obligating the Council to sign a particular lease with a particular entity. Kim Thompson, Rutan & Tucker, stated that they need to look into the issue of authority and who signed the document, and the effects of what has happened since the 2000 and 2003 agreements. Regarding the MOU, Volume 56 - Page 1239 City of Newport Beach City Council Minutes September 28, 2004 INDEX he believed that there needs to be some tweaking done to the language before it is adopted. For example, he stated that he would change the wording in Section 3 (Future Negotiations). Mayor Pro Tem Bromberg asked if the MOU is premature. Mr. Burnham indicated that, based on what he has seen over the last couple of days and the discussions he has had with Mr. Thompson, he believes that there are changes to the MOU that should be crafted before it is approved by Council. Mayor Ridgeway asked if this has to be called an MOU and suggested calling it a proposed term sheet. Mr. Burnham stated that the idea of having discussions preceding the election were not to commit Council or the proponent to a particular lease, but to give the voters a broad brush of what the business deal might look like if Measure L were approved. He believed that the MOU probably goes beyond where it needs to go and should be revised. In response to Council Member Rosansky's questions, Mr. Burnham indicated that neither the 2000 nor 2003 agreements required the City to enter into an MOU prior to the election. He stated that Council could have a receive and file item that deals with the status of the negotiations to date. He noted that there was a desire by some individuals to give greater credence to the status of the negotiations rather than a statement of terms and conditions so there is no alternation of the terms and conditions at a future time. Council Member Rosansky stated that he doesn't want to be bound to anything until an agreement has been negotiated. Mayor Pro Tern Bromberg pointed out that last year Council promised the public that a number of things would occur before this went to a vote, including having proposed lease terms. However, he noted that they never said there would be an MOU or an agreement regarding the proposed lease terms. Mr. Burnham stated that they can simplify the term sheet and focus on the core issues and terms, and then bring it back as a receive and file item. Council Member Heffernan stated that he and Mayor Ridgeway are on the negotiating team and have different opinions about the measure. He indicated that he thought that, once this was on the ballot, they'd know the feasible and complete outline of terms, i.e. who the tenant was, their background, and essentially what the lease might be. He noted that they last met in early July. He believed that, in order to create a document that binds the City under an MOU, it is hard to use best efforts, commercially reasonable efforts, or good faith efforts when you don't have all the terms. Further, the process should be scrapped since it is too late to enter into intense negotiations to develop the full points. He noted that he asked who the tenant was going to be five weeks ago. Motion by Mayor Pro Tern Brombere to continue the item to the October 12, 2004 Council meeting and direct staff to bring the item back as a receive and file item. Volume 56 - Page 1240 City of Newport Beach City Council Minutes September 28, 2004 ufUN i7OM Mr. Burnham confirmed for Council Member Nichols that the contract states that STH has the sole negotiating right if this is approved by the voters. He stated that the project would generate about $2.2 million or $2.3 million when the resort stabilized if you assume a $1.1 million base rent, look at the percentage rents, and assume the projections from PKF are correct relative to room rates and occupancy. He noted that a lot of issues arose during the discussions, some of which involve the fractional units and how those would be structured to not impact the hotel parcel and vice versa so the City wouldn't have any additional obligations. Council Member Nichols noted that timeshares were not in the original contract. He expressed concern that the developer could pull money out at an early date and that clear beach access may be inhibited at the center and at the ends of the hotel. Mr. Burnham stated that this is not the way he understood the project was going to be designed since it's not supposed to go beyond the current development line. He agreed that the 2000 or 2003 agreements did not reference fractional units or timeshares, but reported that the EIR contained an assumption that the project might include up to 12 fractional units. Council Member Heffernan stated that Mr. Sutherland has spent a lot of money and effort on this project. He emphasized that he wants to be fair and present the terms appropriately, and that it is not his objective to scuttle the project by presenting harsh terms. He stated that he wants to present complete terms that are fair and agreed to by both sides. Joe O'Hora believed that the MOU transcends the debate about parks and hotels; that the first line can be construed as fiscal malfeasant and failure to exercise the fiduciary responsibility required of elected officials; and all citizens agree that the City must stop negotiating with an unqualified individual and an entity that doesn't exist. He stated that his legal advisors confirmed that Sutherland Talla Hospitality LLP is a non - entity, believing that the City Attorney's office knew this. He believed that these agreements will lead to the transfer of 8.5 acres of designated parkland. He stated that he read Mr. Sutherland's financial and experience book, believing that he is not qualified to undertake this project. He took issue with the MOU and the terms, and believed that the City will be more deeply involved in questionable actions and relationships with this document. He stated that he has been advised that such activity, past and present, could be sufficient grounds for rendering all previous agreements with this individual and company null and void regardless of the outcome of the election. John Buttolph stated that he is running for City Council largely because of what he sees in this Council's activities with respect to hotels. He indicated that he reviewed the agreements that the City has with Sutherland Talla LLP and noted that an LLP can only be formed by lawyers, accountants, or architects. He stated that Council and the City Attorney know that there is no LLP, adding that the Acting City Attorney has never seen evidence of the LLP. He stated that Council can walk away from this deal at anytime and the other person cannot enforce it. He believed that now the public is compelled to vote on this because Council passed on it and entered into an agreement with a non - existent entity. Volume 56 - Page 1241 City of Newport Beach City Council Minutes September 28, 2004 INDEX Stephen Sutherland reported that Sutherland Talla never was an LLP and he never presented it as an LLP. He stated that Sutherland Talla has never been anything more than an agreement between himself and Mr. Tana to proceed on this project since 1999. He indicated that a little over two months ago, he discovered that Mr. Talla had a business investment that he was uncomfortable with, so he asked him to withdraw from the partnership. He pointed out that the personal attacks he has gone through for the past five years are without basis. He agreed that this item needs more study and should come back at a future meeting. In response to Mayor Ridgeway's question, Acting City Attorney Clauson reported that Mr. Buttolph came by her office yesterday requesting the incorporation documents. She stated that she told him that she was not under the impression that Sutherland Talla Hospitality was a corporation or an LLP, but a partnership. Further, from her review of the agreement, the City didn't have an agreement with Sutherland Talla Hospitality LLP. She stated that the general partnership was not noted. Mr. Burnham reported that the amended 2003 agreement is with Sutherland Talla Hospitality, and does not state LLP. He indicated that he doesn't have a copy of the primary agreement with him at this time. He stated that Mr. Thompson confirmed that LLP's are for purposes of architecture or law and that Mr. Sutherland, to his knowledge, has never represented himself as an LLP. He stated that he cannot explain why the original agreement had that representation. He indicated that Mr. Sutherland told him that there was a verbal partnership between himself and Mr. Talla. He reported that Mr. Thompson is sorting through the legal significance of all of the things being said this evening. In response to Council Member Webb's questions, Mr. Sutherland stated that he was vice president of a local architectural firm in the late 1980s, he began his own architectural firm in 1990 with a local architect and was the president of that corporation. He indicated that they designed and built projects in the United States, Mexico, and Spain. He stated that he has stacks of letters from clients that he would show Council privately because he does not want the opponents of the project harassing his former clients. He noted that he has been published on a number of occasions, he has had two projects a part of American Institute of Architects (AIA) awards, and he was a member of AIA. He noted that, as a president of an architectural firm, he had all legal rights to carry on full architectural duties except stamp construction documents. Don Regan stated that he was the city attorney For a number of cities and was the founder of a company that built assisted living facilities. He indicated that more than half of their projects were on behalf of an LLP in formation or a handshake partnership. He stated that the method that Council is following is the method that they followed. He noted that an LLP is not formed until a certificate is formed. He stated that he is surprised at the vitriol that is coming out against this project. Iie expressed the opinion that the proposed project would be better for the community. Volume 56 - Page 1242 City of Newport Beach City Council Minutes September 28, 2004 INDEX Joe Repus believed that Mr. Sutherland states things that are not true and noted that he has had tax liens since the 1980s. He asked how much the Balboa Bay Club paid in rent, noting that the facility is bigger than Marinapark. Council Member Webb stated that they paid roughly $2.6 million. Mr. Repus indicated that the first four quarterly payments are about $2 million to $2.1 million, but Mr. Sutherland is claiming that he will make $2.1 million on a facility that is half the size. He asked when the last time a 12 boat marina was built in the City. He asked Council Member Heffernan to follow up on Mr. Sutherland's references. Allan Beek stated that he is the secretary of Stop Polluting Our Neighborhood (SPON) who is suing the City and had to serve on the real party in interest. He indicated that their attorney had a tough time finding the real party in interest and had to serve it on Mr. Sutherland because he couldn't find the other entities. He noted that most contracts state that notices have to be given to someone in case of default; however, this contract didn't have that information. He indicated that Mr. Burnham noted that the purpose of the MOU was to give voters a sense of confidence, but believed that the voters are not confident if they're watching this meeting. Geoffrey Davis indicated that he is in favor of the proposed luxury hotel, believing that it will have a positive affect on property values and improve quality of life. He asked the City to do something for them instead of the visitors. He stated that the Girl Scout House will become a clean, safe, state -of- the -art facility for the children and the public; and the American Legion will also benefit. He noted that there may be 75 years of precedence since many private and commercial enterprises have benefited and existed on publicly -owned land, i.e. the Beacon Bay Development, marine fueling station, and the Balboa ferry. He believed that the opponents of Measure L are promoting frivolous, legal maneuvers aimed at preventing the public from voting on this issue. He stated that we cannot allow special interest groups to take control of the City's future by demanding that everyone continue to live in the past. John Rettberg stated that no one is trying to stop a vote, but are interested in having the facts to make an informed decision. He believed that the current information is not adequate for people to make an informed decision. He indicated that he would've been thrown out if he went to a board of directors with the information that has been provided. Craig Morissette stated that there was a gasp by the audience at the July 27 Council meeting when it was revealed that millions of dollars from the sale of the timeshares was going to go to the developer. He noted that the MOU doesn't discuss this but believed that it needs to be addressed. He expressed concern with Mr. Sutherland's credentials attached to the staff report. He stated that the Secretary of State's Office confirmed that there is no Sutherland Talla Hospitality LLP or LLC; there is no Stephen Sutherland licensed in California according to the Architects Board and the Contractors Licensing Board; and that Mr. Sutherland is no longer a member of AIA. He provided Council with a list of questions he would like answered tonight. Volume 56 - Page 1243 City of Newport Beach City Council Minutes September 28, 2004 INDEX Tom Billings believed that, pursuant to the previous comments and, on behalf of the voters of Newport Beach, he urged Council to invalidate and void the MOU. Laura Dietz stated that Mr. Sutherland has already answered Mr. Morissette's questions. She took issue with Mr. Billings speaking on behalf of the voters of the City since he was not elected to City Council. She agreed with Mayor Pro Tem Bromberg and Council Member Rosansky that this may not really be an MOU, but there needs to be general terms for voters to base their vote. She encouraged Council to have staff review all the critical elements that the public can use to make a determination whether this project is good for Newport Beach. Jan Vandersloot noted that the MOU mentions Sutherland Talla Hospitality LLP and that Mr. Sutherland asked his partner, Mr. Talla, to leave the partnership after it was brought to light a couple of months ago that Mr. Talla had an ownership interest in a Las Vegas topless club. He reported that he found an article on the internet dated June 2003 that talks about Mr. Talla's ownership of the Sapphire Club. He asked if the City knew who they were dealing with in 2003 and if it would've made a difference if we knew. He stated that we don't even know tonight who we're dealing with. He believed that this property should be a park available to all the people of Newport Beach and not given away and leased for 50 years. He stated that Mr. Talla's name is still on the list as the entity the City is dealing with and believed that the City also needs to deal with him, as well as Mr. Sutherland. He indicated that Council should reject the MOU and the public should look at the controversy and vote "no" on Measure L. Dolores Otting, Council candidate, stated that fair market rent today is $1.1 million, but the MOU doesn't have any acceleration to determine what the rent should be if the project doesn't start until at least 2008. She noted that the lease negotiating subcommittee hasn't met since early July. She stated that, when you purchase a home, they don't let you move in and then 30 days or 60 days later, determine if you can qualify for the mortgage. She asked if it is legal for the City to enter into an agreement to give somebody $100 million worth of property for $1 million a year with someone that isn't a company. She stated that this is how the County got into bankruptcy. She stated that, on July 27, she brought Council information about the Sapphire Club, the LLCs, the LLPs, etc., but the City still doesn't know who it is doing business with. She stated that the City didn't want the Mermaid, but its okay to be associated with money from a strip club. Ms. Otting stated that she is starting to feel bad for Mr. Sutherland because she's starting to think that he's getting set up on this deal. She indicated that it is not her job and two other women's job to find out the things they did about Mr. Talla. She stated that it is the City's job, noting that this is one of the reasons why she is running for City Council. She believed that the voters have nothing to vote on. She emphasized that they should've had all of this information in 2003. Mr. Burnham emphasized that there is nothing that Council is considering that involves giving Mr. Sutherland $100 million worth of property. He stated that making comparisons to Mr. Talla and the Volume 56 - Page 1244 City of Newport Beach City Council Minutes September 28, 2004 INDEX Mermaid ignores what the term sheet states. He reported that the term sheet talks about an initial five year option in which the proponent has to satisfy a number of conditions that resolve the issues that the public mentioned. He agreed that there are problems with regard to the identity of the entity or individual, but there is nothing being proposed that represents the "give away" that the public is describing. He stated that this is an MOU that tries to describe the status of discussions that Council initiated in good faith to try to give the voters some information. He emphasized that the testimony tonight is not reasonably related to what they are presenting to Council. He confirmed that they have not had discussions with Mr. Sutherland since some time in July. Mayor Ridgeway noted that no one has addressed the financial terms and conditions tonight, but have chosen to make public, personal attacks on Mr. Sutherland and any association that he has. Phillip Arst believed that the MOU is the clearest example of the incomplete information that will be given to the voters and the City's irresponsible giveaway of public facilities and possibly public funds. He stated that he is in favor of the public voting on major general plan amendments such as this, but only with complete information. He expressed concern that some of the provisions in the MOU may result in a burden on the taxpayers, there is no assurance of the City's ability to control the property, and the EIR was issued in the name of Marinapark LLC. Further, the MOU states that the current developer can sell its property rights without Council approval to anyone with a 20% down payment and an agreement with an individual with the necessary experience in hotel management. He believed that the City loses at least $800,000 during the up to seven year option and construction period, and up to $1.7 million possible annual rent from the mobilehomes, and is stuck with the full cost of removing them. He asked what City services will be cut back while the City covers these losses. He stated that the City might as well have a park for the people to enjoy. He believed that the City will get little if any revenue because any sales by the hotel will just take revenue from the other hotels in the City. He added that the $1.1 million base rent for the hotel should probably be closer to $3 million, considering the property value. Further, it is not adjusted for inflation over a 25 year period. Mr. Burnham stated that the term sheet does allow assignment without the City's consent to a recognized luxury hotel operator or an entity with no less than 20% equity that has a contract with a luxury resort operator or has the requisite ability. He indicated that he is not sure if Mr. Arst was referring to that provision or the provision that says that the City receives 20% of the profits if there is a transfer within the first 54 months. He clarified that the proponent would basically be allowed to sign the resort to an entity that was a luxury resort or an entity with substantial equity in the property and had a contract with a luxury resort operator to ensure that the operation of the facility was in accordance with the standards. He emphasized that this was a summary of a term rather than the precise language of an agreement that would probably cover more contingencies. Volume 56 - Page 1245 City of Newport Beach City Council Minutes September 28, 2004 INDEX Council Member Nichols commended Mr. Sutherland for paying all of his bills to the City and upholding his monetary commitments. Mayor Pro Tem Bromberg stated that this time of the election year is the "silly season" because people act in a way that they normally don't act. He pointed out that there is nothing to make null or void because there is no legal document. He clarified that his motion was to continue this and bring it back as a receive and file item which is a non - binding document on anybody. He believed that this threw off the people who had prepared statements. He indicated that the people in favor of the project and only two people opposed spoke to the issue. He stated that the others made personal attacks. He emphasized that, if Measure L passes and Mr. Sutherland is not who or what he says he is, the City does not have to do business with him. Council Member Daigle stated that she would like to follow the advice of the legal representatives that an MOU is premature and expressed her support of the motion. She believed that there is benefit to providing voters with factual information and stated that she wants to move in that direction in whatever form that takes. She noted that we live in an age of consumer empowerment where people have a lot of information about everything. She stated that the constituents are smart and savvy, and want information. Regarding Exhibit A, Council Member Webb asked why the term should be extended beyond the option date as opposed to adding extra time. He referenced Section 2.2(b) and requested that the statement clearly indicate that the site plan that was presented in the environmental document may not be the plan that's approved because there's a number of items that need to be resolved. He believed that a clause was supposed to be added to Section C which asks for the City to be able to determine the character of the people whom it would be dealing with and allows the City to get out of the document if it felt that the moral turpitude was not appropriate for it to enter into a contract. He stated that he does not understand what "abatement" means in Section 3.1. Regarding reappraisal, he stated that the City needs to make sure that the statement does not allow for the rent to go down. Council Member Webb stated that it needs to be determined whether the City should receive some portion of the sale price of the fractional units. He believed that the ballot measure stating that the community center and public recreation facilities shall be on three acres is a constraint and should be in Section 5.2. He stated that the hotel is on about five acres and the public, recreational facilities are on at least three acres. Council Member Webb stated that partialization should discuss the split between the public recreational facilities and the hotel facilities related to the five and three acres. Regarding transfers, he believed that it is reasonable for the City to have some say about who the property gets transferred to. Council Member Nichols noted that a vote against the motion really has no meaning and that a vote in favor of the motion just means that it's coming back at the next meeting. Volume 56 - Page 1246 City of Newport Beach City Council Minutes September 28, 2004 Mayor Pro Tem Bromberg stated that acceleration of rent occurs when the project is successful. However, if the project is not successful, we need to be sure that the City is covered. Council Member Heffernan asked, if this is brought back as a receive and file item, is that then something that the City is obligated under, even though the City Council does not vote on it. He stated that Council Member Webb raised issues that are really deal terms and asked how they are going to be solved in two weeks. Mr. Burnham stated that Council would simply be seeing a status report at the next meeting that discusses the opinions of Council. Further, the report would then respond to the questions and comments that Council Member Webb and Mayor Pro Tem Bromberg posed. He believed that there would not be time nor would it be productive to meet with Mr. Sutherland. He stated that they would bring back a term sheet that looks somewhat like the one provided, but would have additional explanations and address issues raised by Mayor Pro Tem Bromberg and Council Member Webb. Council Member Heffernan asked why the City can't use Cal Hollis' proposed term sheet since the City won't be negotiating with anyone. Mr. Burnham stated that it was his understanding that the request was to give Council the status of the discussion. Council Member Heffernan believed that we're trying to get to a point that explains what the trade off is if the City loses the park site. He noted that the trade off would be the revenue source for a certain amount of time. He added that it should also list the risks, rewards, and contingencies. He emphasized that presenting enough information without handcuffing the City is a difficult thing to do. Mayor Ridgeway stated that Mr. Burnham can meet with him and Council Member Heffernan. He reported that this is an unsubordinated ground lease and the City will not subordinate to any lender. He emphasized that, if the project is built and there is a default, the City gets the project and the bank loses. The motion carried by the following roll call vote Ayes: Heffernan, Rosansky, Bromberg, Webb, Daigle, Nichols, Mayor Ridgeway Noes: None Abstain: None Absent: None 21. UNSCHEDULED VACANCY ON THE PLANNING COMMISSION. Motion by Mayor Rid ewav to 1) declare a vacancy on the Planning Commission due to the appointment of Leslie Daigle to the District 4 City Council position; 2) confirm the Mayor's appointment of Mayor Ridgeway, Mayor Pro Tem Bromberg, and Council Member Webb to serve on the Ad- Hoc Appointments Committee; and 3) direct the City Clerk to post and publish a Special Vacancy Notice requesting that applications be submitted by 4:00 p.m. on Thursday, October 14, 2004, and schedule the submission of the nominations to the Council on October 26, 2004 with the final appointment to be made on November 9, 2004. Volume 56 - Page 1247 INDEX (100 -2004) City of Newport Beach City Council Minutes September 28, 2004 The motion carried by the following roll call vote: Ayes: Heffernan, Rosansky, Bromberg, Webb, Daigle, Nichols, Mayor Ridgeway Noes: None Abstain: None Absent: None 22. APPOINTMENTS TO FILL VACANT POSITIONS ON VARIOUS COMMITTEES CREATED BY THE RESIGNATION OF MAYOR PRO TEM ADAMS. Motion by Mayor Ridgeway to confirm the Mayor's appointment of Council Member Daigle to fill the following committee vacancies created as a result of the resignation of Mayor Pro Tern Adams: 1) Web Site Review Ad Hoc Committee (Chair); 2) SR73 /SR55/I -405 Freeways Confluence Policy Committee; 3) City Centennial 2006 Committee; and 4) Newport Beach/Irvine Borders Committee. The motion carried by the following roll call vote: Ayes: Heffernan, Rosansky, Bromberg, Webb, Daigle, Nichols, Mayor Ridgeway Noes: None Abstain: None Absent: None Mayor Ridgeway recessed the meeting at 10:10 p.m and reconvened the meeting at 10:20 p.m. (Council Member Heffernan arrived at 10:30 p.m ) N. ITEMS REMOVED FROM THE CONSENT CALENDAR 5. ZONING AMENDMENT /GROUP LIVING USES. Mark Bernie believed that part of the City's goal with multi - family dwellings should be to maintain affordable housing for individuals, like himself, who opt to live in apartments and are interested in being a part of the community and not just living here for 30, 60, or 90 days. He indicated that the building he resides in has changed ownership, the residents are being displaced, and the property is being converted to a rehabilitation facility. He asked what efforts are being made to maintain affordable multi - family dwelling residences. Mr. Bernie indicated that all the residents were sent termination notices and the new leasing agent told them that the property will become a rehabilitation facility. Mayor Ridgeway clarified that, since the property is not within the City's stock of affordable housing, the City cannot protect Mr. Bernie and the other tenants in his building. Mr. Bernie indicated that he meant affordable housing in a more general term, not Section 8, etc. Mayor Ridgeway reported that 44% of the City's 37,500 units are multi- family or rental units. Volume 56 - Page 1248 INDEX (100 -2004) (100 -2004) City of Newport Beach City Council Minutes September 28, 2004 Paul Lopez stated that he owns the property next door to Mr. Bernie and expressed concern that the 8 -unit complex will be converted to a rehabilitation facility. He believed that this would completely change the social environment of the area and increase the density. Mayor Ridgeway stated that the ordinance will actually protect Mr. Lopez. He explained that, if there are six or less people in a unit, there is nothing the City can do. However, if there are seven or more, then the rehabilitation facility will have to get a Federal Exemption Permit and will have to comply with certain rules and regulations. Acting City Attorney Clauson suggested that Mr. Lopez contact the Planning Department for more clarification. Gerry Marshall stated that he is representing Narconon. He noted that there is an email in the staff report from the Planning Director to a neighbor that indicated that the City has been enforcing the codes and Narconon has been in compliance with those codes. He stated that he understands that it is the City's intent to try to make a better situation for all the residents and to make sure that the centers are in compliance. He announced that September is National Recovery Month and the last week in October is Red Ribbon Week. Motion by Council Member Webb to adopt Ordinance No. 2004 -16 amending the Zoning Code. Council Member Nichols referenced Mrs. Martin's letter in the staff report and believed that this was supposed to go to the Planning Commission. Mayor Ridgeway suggested that he discuss this with Ms. Clauson. The motion carried by the following roll call vote: Ayes: Heffernan, Rosansky, Bromberg, Webb, Daigle, Mayor Ridgeway Noes: Nichols Abstain: None Absent: None 6. GRANTS FOR THE BIG CANYON CREEK RESTORATION PROJECT. Council Member Nichols asked if this project is second to the Back Bay project. Assistant City Manager Kiff explained that this project is outside of the footprint of the Upper Bay project. He stated that the pot of money that the City received comes from a different source than what is being sought after for the Upper Bay project. He added that they are not in direct competition with each other nor do their construction activities impact each other. Motion by Council Member Webb to adopt Resolution No. 2004 -83 relating to grants for the Big Canyon Creek Restoration Project. The motion carried by the following roll call vote: Volume 56 - Page 1249 INDEX C -3594 Big Canyon Creek (38/100 -2004) City of Newport Beach City Council Minutes September 28, 2004 Ayes: Heffernan, Rosansky, Bromberg, Webb, Daigle, Nichols, Mayor Ridgeway Noes: None Abstain: None Absent: None RESOLUTION AUTHORIZING THE CITY TO ENTER INTO A CONSTRUCTION AND LEASE AGREEMENT BETWEEN THE CITY AND THE RANCHO SANTIAGO COMMUNITY COLLEGE DISTRICT TO USE DISTRICT FUNDS TO CONSTRUCT A FIRE TRAINING TOWER ON CITY PROPERTY AND SHARE ITS USE BETWEEN THE TWO PARTIES. Dolores Otting, Council candidate, asked where the tower will be built and stated that she believes that the City should be training with Costa Mesa. She noted that Costa Mesa is also going to be receiving $350,000 and, if the money was pooled at one location, $700,000 would buy a lot for one training tower program. She stated that the City is a rich city right now, but something could happen. She suggested that the City do anything it can to make sure the firefighters' needs are met without being redundant with programs. Fire Chief Riley stated that the tower would be built at the new fire station. He indicated that the Santa Ana College (SAC) Fire Technology Program has a regional approach to providing training and utilizes multiple centers throughout the County. He pointed out that it was their desire to try to enhance existing training programs instead of consolidate their funds. He reported that Newport Beach, Costa Mesa, Huntington Beach, and Santa Ana will be getting money as part of the Community College Bond Fund that was passed three years ago. Regarding training in other cities, he stated that he believes that the value to the community of maintaining resources in the local arena as opposed to traveling outside the jurisdiction is important. He indicated that the continuous downtime and travel were primary reasons why they got out of the training agreement with Huntington Beach. In response to Mayor Ridgeway's questions, Chief Riley reported that the Fire Department has 120 safety employees. He added that they could also share the tower with the Police Department to use for their smaller, basic SWAT operation. He stated that, when the City is not using it, the agreement allows SAC to use it as long as it doesn't impact their operation. Chief Riley indicated that the fire station will cost about $4.1 million. Council Member Nichols stated that the $350,000 only equates to $12,000 to $15,000 a year for a lease that's over 20 years. Chief Riley clarified that the agreement provides for a full payment of the $350,000 on completion of the construction. He noted that the money is only designed to pay for the construction of the training tower and no other facilities. He added that this doesn't pay for the use of the fire station or the rest of the ground. He stated that SAC does have to drive on the grounds to use the tower, but emphasized that their use of the tower will be on a very limited basis. Volume 56 - Page 1250 INDEX C -3733 Fire Training Tower (38/100 -2004) City of Newport Beach City Council Minutes September 28, 2004 Chief Riley clarified that the County will provide $2.5 million for the purchase of the property and some additional money for the construction of the fire station. He stated that, due to the changes that have occurred in the construction industry and what is happening with Public Works projects, they will be going back to the County to request more money for the construction costs. Motion by Mayor Pro Tern Brombere to adopt Resolution No. 2004 -84. The motion carried by the following roll call vote: Ayes: Heffernan, Rosansky, Bromberg, Webb, Daigle, Mayor Ridgeway Noes: Nichols Abstain: None Absent: None S. ACCEPTANCE OF IRREVOCABLE OFFER OF DEDICATION: NEWPORT RIDGE PARK; CONVEYANCE OF OWNERSHIP TO THE NEWPORT RIDGE COMMUNITY ASSOCIATION. Council Member Webb stated that he has no problem with accepting the irrevocable offer of dedication. He explained that one of the reasons this had an irrevocable offer of dedication was because it met the park dedication requirements for the development of the Newport Coast area. He noted that the community associations are doing all the work already and, in effect, leasing the property. However, he believed that the City should not give up all its park property rights forever. He stated that the City is short on active parks and noted that there may be a time in the future that the City may need recreational activity in this area. He requested that Council consider changing "quitclaim or otherwise transfer" to "lease" in recommendation 3. Mayor Ridgeway reported that, at Newport Ridge Park, from the restroom inward to the Newport Ridge Community Association, the City agreed to keep that portion private in the Pre - Annexation Agreement (PAA). Council Member Webb stated that he does not object to that portion, but is concerned about the athletic fields from the restroom out to San Joaquin. Assistant City Manager Kiff stated that the fourth line in the resolution title can be changed to read, "...and directing the lease... ", and "quitclaim or otherwise transfer or" can be removed in Section 2. He indicated that this will allow the City to exact the lease and further discuss with the NCAC whether the City could have some control over the ball fields. Motion by Council Member Webb to adopt amended Resolution No. 2004 -85 which: 1) authorizes the acceptance of an Irrevocable Offer of Dedication for Newport Ridge Park; 2) authorizes the Mayor or City Manager to accomplish the acceptance in any manner deemed feasible provided that such acceptance generally follows the terms of 1996 San Joaquin Hills Local Parks Irrevocable Offer of Dedication; and 3) authorizes the City Manager to lease that portion of Newport Ridge Park exclusive of the property needed for the proposed Newport Coast Community Center to the Newport Ridge Community Association or similar entity. Volume 56 - Page 1251 INDEX (100 -2004) City of Newport Beach City Council Minutes September 28, 2004 In response to Council Member Nichols' questions, Mr. Kiff explained that the City would own the entire property and would lease back to the association the portion that is not necessary for the community center and its parking lot. Further, there could be a control in the lease that would allow some City use of the two baseball diamonds and soccer overlay. He stated that the association is okay with the concept of leasing the property and maintaining it since they do that today. However, he has not talked with them specifically about some control over the fields. He indicated that the City would discuss the parking lot and the ball fields with the association and not be concerned about everything past the two fields and the parking lot. He noted that the property actually belongs to The Irvine Company and explained that only a public agency can accept an irrevocable offer to dedicate. He confirmed that, by the City leasing it back to the association, the association would retain control and continue the maintenance as they do now. Council Member Webb indicated that this would allow the City to change the lease if situations change in the future. Council Member Heffernan indicated that discussion will ensue at the NCAC meeting relative to who will have long term control of the ball fields between the community center and the parking lot adjacent to the tennis court. The motion carried by the following roll call vote: Ayes: Heffernan, Rosansky, Bromberg, Webb, Daigle, Nichols, Mayor Ridgeway Noes: None Abstain: None Absent: None Without objection, Mayor Ridgeway requested that Item Nos. 9 and 10 be considered together. 9. SALE OF BONDS FOR UNDERGROUND ASSESSMENT DISTRICT NO. 68 — NEWPORT SHORES. 10. SALE OF BONDS FOR UNDERGROUND ASSESSMENT DISTRICT NO. 69 — WEST NEWPORT. Council Member Rosansky recused himself. Administrative Services Director Danner stated that bond counsel and the financial advisors are in the audience. He reported that, by adopting the resolutions, Council is authorizing the bonds to be issued, sold, and delivered; authorizing the City Manager, the Director of Administrative Services, or other City official so designated to execute the various documents and instruments; approving the bond indentures that are on file with the City Clerk; approving the preliminary official statement that is on file with the City Clerk; approving the continuing disclosure agreements that are on file with the City Clerk; authorizing the City to apply for a bond rating and insurance if advisable by the financial consultants; and approving the bonds to be sold competitively on October 19. Volume 56 - Page 1252 I AN1 Assessment District No. 68/ Newport Shores (89/100 -2004) Assessment District No. 69/ West Newport (89/100 -2004) City of Newport Beach City Council Minutes September 28, 2004 Motion by Council Member Webb to adopt Resolution No. 2004 -86 which sets forth the terms and conditions for the sale of bonds and approves the Purchase Agreement submitted by the designated underwriter for Assessment District No. 68; and adopt Resolution No. 2004 -87 which sets forth the terms and conditions for the sale of bonds and approves the Purchase Agreement submitted by the designated underwriter for Assessment District No. 69. The motion carried by the following roll call vote Ayes: Heffernan, Bromberg, Webb, Daigle, Nichols, Mayor Ridgeway Noes: None Abstain: Rosansky Absent: None 12. APPROVAL OF A PROFESSIONAL SERVICES AGREEMENT (PSA) WITH ORANGE COUNTY COASTKEEPER FOR A COOPERATIVE PROJECT TO DEVELOP A CONTAMINATED SEDIMENT REMEDIATION PLAN FOR THE RHINE CHANNEL. Motion by Council Member Webb to approve the PSA with Orange County Coastkeeper providing $68,000 in matching funds for SWRCB Grant Agreement No. 03 -183- 558 -0. The motion carried by the following roll call vote Ayes: Heffernan, Rosansky, Bromberg, Webb, Daigle, Nichols, Mayor Ridgeway Noes: None Abstain: None Absent: None 13. HUMAN SERVICES GRANTS FOR 2004 -2005. Council Member Nichols asked where the money comes from, why the City be giving it to people, and why the City is in the charity business. Assistant City Manager Kiff reported that Council Policy A -12, while in effect, is brought before Council every year and is provided for in the budget. He stated that the $25,000 goes to non - profit groups that provide human services for residents of Newport Beach. He indicated that the City sends letters to the organizations they know about, but continue to build the list. He stated that, of those that respond, they evaluate and propose this every September. He indicated that, if Council Member Nichols felt strongly that this policy needed to be revisited, he could call up this policy for a Council meeting. Motion by Mayor Pro Tem Brombere to authorize the allocation of $25,000 in Human Services Grants in the amounts and to the agencies described in the staff report. The motion carried by the following roll call vote: Volume 56 - Page 1253 INDEX C -3734 Contaminated Sediment Remediation Plan for the Rhine Channel (38/100 -2004) (100 -2004) City of Newport Beach City Council Minutes September 28, 2004 Ayes: Heffernan, Rosansky, Bromberg, Webb, Daigle, Mayor Ridgeway Noes: Nichols Abstain: None Absent: None 14. APPOINTMENT OF STAFF REPRESENTATIVES FOR THE ORANGE COUNTY AREA HOUSING AND FINANCING AGENCY. Council Member Nichols believed that the City should not be in the housing business of giving loans. Program Administrator Trimble noted that the issue is not whether the City participates in the Orange County Area Housing and Finance Agency. He stated that the City has been a member since 2002 and the staff report is simply recommending a change in the representative appointment to the board. Motion by Council Member Webb to authorize the position of Assistant City Manager, currently Sharon Wood, to act as a Director on the Board of the Orange County Area Housing and Finance Agency, and authorize the position of Program Manager, currently Daniel Trimble, to act as an Alternate Director. The motion carried by the following roll call vote: Ayes: Heffernan, Rosansky, Bromberg, Webb, Daigle, Mayor Ridgeway Noes: Nichols Abstain: None Absent: None 18. SUNSET RIDGE PARK UPDATE (contd. from 9114/04). Assistant City Manager Kiff reported that the information the City sent to the State includes the proposed operating lease with State Parks and the document that would transfer jurisdiction. He explained that the City sends money to State Parks and enters into a long term agreement with them, the State Parks buys the property from Caltrans, they take title to it, and then the City's lease is effective. He reported that they informed their legislative advocate to dog it for the City and expect to have some movement to report to Council quickly. He stated that the City is trying to change the legislation to clearly include the easterly parcel, noting that Caltrans doesn't believe that the City included it in the legislation. Council Member Rosansky noted that the staff report talks about a ten year lease, although a long term lease was discussed. Acting City Attorney Clauson indicated that there are provisions in State law that Emit the ability to lease for more than 10 years, but there is a subsection in that law that allows for authorization through the State legislature to get an extension on the lease. She added that this can only be applied for during the budget season. She stated that the draft that was sent to the State has a subsection that includes the City's intent to go through the process so that the City has a longer lease. Council Member Rosansky believed that there was a process that didn't have to wait until the State Volume 56 - Page 1254 ►Ifi m. (100 -2004) (100 -2004) City of Newport Beach City Council Minutes September 28, 2004 budget discussions. Ms. Clauson stated that the process is through the Department of Public Works. Mr. Kiff reported that the City will try to do both to see what can be done faster. Council Member Rosansky requested that staff forward him a diagram that specifically outlines where the 15.05 acres is. Mr. Kiff stated that this will be done as part of developing the property's formal legal description. O. MOTION FOR RECONSIDERATION - None. P. ADJOURNMENT - 11:12 p.m. xxxxxxxxxxxxxxxxxxx The agenda for the Regular Meeting was posted on September 22, 2004, at 3:00 p.m. on the City Hall Bulletin Board located outside of the City of Newport Beach Administration Building. City Clerk .i Recording Secretary Mayor Volume 56 - Page 1255 IIa,01�