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HomeMy WebLinkAbout2012-120 - Setting Rent for Residential Piers Located Upon TidelandsRESOLUTION NO. 2012 -120 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH SETTING RENT FOR RESIDENTIAL PIERS LOCATED UPON TIDELANDS WHEREAS, pursuant to the 1978 Beacon Bay Bill, as amended, ( "Beacon Bay Bill ") the City of Newport Beach ( "City ") acts on behalf of the State of California as the trustee of Tidelands located within the City's limits, including Newport Harbor; WHEREAS, the Beacon Bay Bill and Chapter 17.60 of the Newport Beach Municipal Code ( "NBMC ") allow the City to authorize third parties to construct/maintain residential piers upon tidelands; WHEREAS, on July 27, 2010 the City Council formed the Council Ad Hoc Committee on Harbor Charges ( "Committee ") and tasked the Committee with performing a comprehensive review of tidelands uses. The Committee looked at mooring fees, rents at the Balboa Yacht Basin, and rents charged to persons holding commercial pier permits but did not review rents for residential piers; WHEREAS, Mayor Gardner and Council Members Henn and Rosansky have acted as a working group to review residential pier rental rates, as the Committee's specific scope of work neared completion; WHEREAS, the Beacon Bay Bill, California Constitution Article 16, Section 6, and City Council Policy F -7(D) require the City to receive fair market value Rent from third parties using the Tidelands; WHEREAS, the City Council has the exclusive discretion to determine fair market value Rent based upon the findings of a City - selected appraiser; WHEREAS, an appraisal report by Rasmuson Appraisal Services, and an appraisal report by Netzer & Associates, were prepared and delivered to the City and have been reviewed and considered by the City Council, which reports are part of the record for this matter; WHEREAS, on'November 19, 2012, the working group held a public outreach meeting with Residential Pier Permittees to solicit their input and participation in the Tidelands review process and this meeting afforded the public the opportunity to comment on this matter as well as allowing the working group to provide to the public information relating to this matter; -x- WHEREAS, on November 28, 2012, the City Council held a Special Meeting to solicit input from Residential Pier Permittees and members of the community regarding the proposed fair market rent for Residential Piers; WHEREAS, the City Council has considered all documents and comments in the record in connection with this resolution; WHEREAS, all previous resolutions and actions regarding the fair market value Rent for Residential Piers located upon Tidelands that are in conflict with the Rent established by the City Council in this resolution are hereby repealed. NOW, THEREFORE, the City Council of the City of Newport Beach resolves as follows: Section 1: The Recitals provided above are true and correct and are incorporated into the substantive portion of this resolution. Section 2: The City Council finds that the Rent provisions contained in the attached Residential Pier Tidelands Rent Calculations, which is incorporated by reference, provide for the charging of fair market value Rent and that the rental rate (and adjustments) in the attachment constitute fair market value Rent for Residential Piers located upon Tidelands, which findings are made by the City Council in its exclusive discretion but are based on the information in the appraisals of its City - selected appraisers and, in addition, on other testimony and documents in the record for this matter. The City Council further finds and determines the Rent for Residential Piers located upon Tidelands, operating under an annual permit, shall be set in accordance with the attached Residential Pier Tidelands Rent Calculations. The Rent established in this resolution shall only be applicable to Permittees with a Residential Pier located over Tidelands. Section 3: The City Council finds the setting of Rent for residential piers located upon Tidelands is not subject to the California Environmental Quality Act ( "CEQA ") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Alternatively, the City Council finds the setting of Rent for residential piers located upon Tidelands is entitled to a Class 1 Categorical Exemption pursuant to CEQA Regulation Section 15301 because the Rent contemplates the continued use of existing facilities, with no expansion of the proposed use. Further, the City Council finds the setting of Rent for residential piers located upon Tidelands is entitled to a Statutory Exemption pursuant to CEQA Regulation Section 15273(a)(1) because the fair market value Rent established by the City Council will be used to meet operating expenses within the Tidelands. -2- Lastly, the City Council finds the setting of Rent for residential piers located upon Tidelands is not a project under CEQA Regulation Section 15061(b)(3) because it has no potential for causing a significant effect on the environment. Section 4: If any section, subsection, sentence, clause or phrase of this resolution is, for any reason, held to be invalid or unconstitutional, such decision shall not affect the validity or constitutionality of the remaining portions of this resolution. The City Council hereby declares that it would have passed this resolution, and each section, subsection, clause or phrase hereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses and phrases be declared unconstitutional. Section 5: This resolution shall take effect immediately upon its adoption by the City Council and the City Clerk shall certify the vote adopting the resolution. ADOPTED this 11th day of December, 2012_ ATTEST: c - Leilani L'Brown, ti City Clerk Attachment: Residential Pier Tidelands Rent Calculations -3- Residential Pier Tidelands Rent Calculations Residential Pier Rent (1) Beginning on March 1, 2013, Residential Pier Permittees shall pay as Rent Fifty -Two and One -Half Cents ($0.525) per square foot of the Premises, as phased in and adjusted pursuant to this resolution. Two (2) examples of the Rent calculation are provided below for illustrative (2) Beginning on March 1, 2013, Permittees that desire to rent/lease their Residential Pier shall notify the City in writing. Permittees that rent/lease their Residential Pier, either in whole or in part, shall pay the Rent applicable to Small Commercial Marinas as established in Resolution No. 2012 -98, or any successor resolution, for the Premises. (3) To the extent a Residential Pier is shared by two (2) or more Permittees, the Rent shall be apportioned equally among the Permittees (i.e., if a Residential Pier is shared by two (2) Permittees half (112) of the Rent shall be billed to one (1) Permittee and the other half (112) of the Rent shall be billed to the other Permittee). The Permittees shall be joint and severally M liable for the Rent. Each Permittee shall receive a permit from the City indicating the percentage of the Premises apportioned to the Permittee. Periodic Adjustments of Rent And Phase In Rent for Residential Piers provided by this resolution, shall be phased -in and adjusted as follows in the table below. In the table, "A" represents the calculated rent based on the known square footage under permit in 2012, multiplied by Fifty -Two and One -Half Cents a square foot ($0.525/SF): Fifty -Two and One -Half Cents ($0.525) Rent Phase -in Table and Adiustment r §SSt 9sa�t5t n�adt '�cmx 10.. Ett� L,ma iL*fi`n4L,ttN `n,i U k.evt�xt.. General Example �� •- 100 199 $ 299 i! During the phase -in period there shall be no adjustment by the U.S. Department of Labor, Bureau of Labor Statistics, Consumer Price Index for All Urban Consumers ( "CPI "), Los Angeles - Riverside- Orange County region or otherwise. Beginning in 2018 and indefinitely beyond, the rental rate shall be adjusted by the change in the CPI or two percent (2 %) whichever is less. The City may conduct a new appraisal of residential pier rental rates in Newport Harbor after March 1, 2018, and every fifth (5t") year thereafter, as part of the appraisal required by Resolution No. 2012- 96, or any successor resolution. The City Council, at its discretion, may use the appraisal to adjust Rent for the following year (i.e., the Rent determined by the appraisal following March 1, 2018 shall be effective March 1, 2019). if the City Council chooses not to adjust Rent across the Class of Permit, it shall use the appraisal's results to adjust the Rent of only those individual Permits that transfer ownership following each appraisal. Once adjusted, these transferred Permits shall be adjusted by the change in CPI or two percent (2 %), whichever is less, until such time that a new appraisal applies to this Permit or Class of Permit- -5- Definitions Unless otherwise provided, the terms provided in the Newport Beach Municipal Code ( "NBMC ") shall apply to this resolution. The singular of any term also includes the plural. (1) Class of Permit means all Permits for Residential Piers in Newport Harbor. (2) Permit refers to a permit issued by the City authorizing a Residential Pier upon the Premises. (3) Permittee means a person who has a permit from the City to construct/maintain a Residential Pier. (4) Premises means those Tidelands which are subject to the applicable permit and are more particularly described and depicted in the applicable permit, excluding any Private Waterways and improvements owned by the Permittee or Tidelands subject to recorded easements for pier and slip purposes. The Premises shall include only the portion of the Tidelands located under a Residential Pier plus up to ten feet (10') of boatable berth space around the dock and float area. The ten feet (10') of boatable berth space shall be reduced to the extent an adjacent property line projects within the ten foot (10') area, or other obstructions (e.g., sediment build up, beach location, etc.) that cause the ten foot (10') area, in the sole and absolute discretion of the City Manager, or his /her designee, to be unusable for purposes of the calculation. In no event shall the rear of the Residential Pier be included within the Premises. (5) Private Waterways means privately owned submerged lands or submerged lands subject to recorded easements for pier and slip purposes. (6) Rent means the annual fair market rent charged on a square footage basis for the use of the Premises. (7) Residential Pier means a pier used by the owner or occupant(s) of the abutting residentially zoned upland property. A Residential Pier shall include the entire pier system, including, but not limited to, the float, gangway, gangway landing, pier, pier platform and internal area of a slip(s). (8) Tidelands means certain tidelands and submerged land (whether filled or unfilled), located in the City of Newport Beach, County of Orange, State of California granted to the City of Newport Beach, as trustee, by the State of California, pursuant to the Tidelands Grant. (9) Tidelands Grant means uncodified legislation related to the State of California's grant of certain rights in the Tidelands to the City of Newport Beach, including, without limitation, the Beacon Bay Bill (Chapter 74 of the Statutes of 1978, as amended [citations omitted]). -7- STATE. OF CALIFORNIA } COUNTY OF ORANGE CITY OF NEWPORT BEACH } 1, Leiiani 1. Brown, City Clerk of the City of Newport Beach, California, do hereby certify that the whole number of members of the City Council is seven; that the foregoing resolution, being Resolution No. 2012 -120 was duly and regularly introduced before and adopted by the City Council of said City at a regular meeting of said Council, duly and regularly held on the 11'h day of December, 2012, and that the same was so passed and adopted by the following vote, to wit: Ayes: Hill, Rosansky, Curry, Henn, Mayor Gardner Noes: Daigle Recuse: Selich IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed the official seal of said City this 14'h day of December, 2012, 41� , /Sw� City Clerk Newport Beach, California (Seal)