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ABSTRACT:
CITY OF
NEWPORT BEACH
City Council Staff Report
March 25, 2014
Agenda Item No. 14.
HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
Aaron Harp, City Attorney — (949) 644 -3131, aharp @newportbeachca.gov
Aaron C. Harp, City Attorney
949 - 644 -3131
Ordinance Amending Newport Beach Municipal Code Subsection 17.60.030(A)
Relating to Residential Pier Permits
On February 14, 2013, the Newport Beach Dock Owners Association and Robert McCaffrey
(collectively, "Association ") filed a complaint against the City of Newport Beach ( "City ") alleging
a violation of the Ralph M. Brown Act relating to the City's adoption of a resolution establishing
fair market value rent for residential piers and a model residential pier permit. The City strongly
disagrees with the Association's allegations and has consistently asserted that the City fully
complied with all requirements of the Act. Nonetheless, to conserve limited resources and avoid
on -going litigation, the parties mutually desire to resolve all disputes and differences between
them. As part of the proposed settlement, the City agreed to consider an amendment to
Newport Beach Municipal Code ( "NBMC ") Subsection 17.60.030(A) regarding the issuance and
renewal of residential pier permits.
RECOMMENDATION:
a) Introduce Ordinance No. 2014 -8, An Ordinance of the City Council of the City of Newport
Beach Amending Newport Beach Municipal Code Subsection 17.60.030(A) Relating to
Residential Pier Permits, and pass the ordinance to second reading on April 8, 2014; and
b) Authorize the City Manager to execute the Settlement Agreement and Release with the
Association, if Ordinance No. 2014 -8 is adopted on April 8, 2014.
FUNDING REQUIREMENTS:
There is no fiscal impact related to this item.
DISCUSSION:
On February 14, 2013, the Association filed a complaint against the City alleging a violation 0385
the Ralph M. Brown Act relating to the City's adoption of a resolution establishing fair market
value rent for residential piers and a model residential pier permit (Newport Beach Dock
Owners Association, et al. v. Newport Beach City Council, et al. (Orange County Superior Court
Case No. 30- 2013 - 00630419- CU- WM -CJC)) ( "Litigation "). The City has consistently maintained
the Litigation lacks merit and the City has fully complied with the open meeting rules of the Act.
However, rather than continue to expend resources in the Litigation, the parties desire to
mutually settle this matter and allow the City to move on with the important mission of serving
its residents.
As part of the proposed settlement, the Association asked the City to consider an amendment
to NBMC Subsection 17.60.030(A) relating to the manner in which residential pier permits are
issued and renewed within Newport Harbor. The proposed amendment maintains City control
over the tidelands, while giving abutting upland property owners' greater assurances in the
residential piers located in front of their properties. The draft language in the attached
ordinance re- states the City's long standing practice and policy of issuing residential pier
permits to the abutting uplands property owner, while staying within the existing 10 year permit
period of NBMC Subsection 17.60.060(A)(2) and the overall 50 year limitation of the Beacon
Bay Bill.
ENVIRONMENTAL REVIEW:
Staff recommends the City Council find the recommended actions are not subject to the
California Environmental Quality Act ( "CEQA ") pursuant to Sections 15060(c)(2) (the activities
will not result in a direct or reasonably foreseeable indirect physical change in the environment)
and 15060(c)(3) (the activities are not a project as defined in Section 15378) of the CEQA
Guidelines, California Code of Regulations, Title 14, Chapter 3, because they have no potential
for resulting in physical change to the environment, directly or indirectly.
NOTICING:
The agenda item has been noticed according to the Brown Act (72 hours in advance of the
meeting at which the City Council considers the item).
ATTACHMENTS:
Description
Attachment A - Ordinance
Attachment B - Settlement Agreement
Attachment C - Redlined Ordinance
:.
ATTACHMENT A
ORDINANCE NO. 2014 -
AN ORDINANCE OF THE CITY COUNCIL OF
THE CITY OF NEWPORT BEACH,
CALIFORNIA AMENDING NEWPORT
BEACH MUNICIPAL CODE SUBSECTION
17.60.030(A) RELATING TO RESIDENTIAL
PIER PERMITS
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 Title 17 of the Newport Beach Municipal
Code ( "NBMC ") allow the City to authorize third parties to construct and maintain
residential piers upon tidelands;
WHEREAS, on February 14, 2013, the Newport Beach Dock Owners Association
and Robert McCaffrey (collectively, "Association ") filed a complaint against the City
alleging a violation of the Ralph M. Brown Act relating to the City's adoption of a
resolution establishing fair market value rent for residential piers and a model residential
pier permit;
WHEREAS, the City disagrees with the Association's allegations and asserts that
it has fully complied with all requirements of the Ralph M. Brown Act;
WHEREAS, the parties have proposed a draft Settlement Agreement and
Release to resolve all disputes and differences between them as to the claims set forth
in Newport Beach Dock Owners Association, et al. v. Newport Beach City Council, et al.
(Orange County Superior Court Case No. 30- 2013 - 00630419- CU- WM -CJC); and
WHEREAS, the draft Settlement Agreement and Release contemplates a
potential revision to NBMC Subsection 17.60.030(A) relating to the issuance and
renewal of residential pier permits.
NOW THEREFORE, the City Council of the City of Newport Beach ordains as
follows:
Section 1: NBMC Subsection 17.60.030(A) is hereby amended to read as
follows:
A. Pier Permits. Upon the request of the abutting upland
residential property owner, lessee or agent of the owner, and
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in accordance with all applicable laws, a residential pier
permit shall be issued for up to ten (10) years. The City shall
extend the term of any residential pier permit for up to ten
(10) years upon: (i) permit expiration and the request of the
owner, lessee or agent of the owner; or (ii) upon sale of the
abutting upland property and the request of the new owner,
lessee or agent of the owner. The maximum term of any
permit issued hereunder, with extensions, shall be fifty (50)
years. After fifty (50) years, the abutting upland residential
property owner, lessee or agent of the owner shall be
required to apply for a new residential pier permit.
Section 2: The City Council finds the introduction and adoption of this ordinance
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 approval of
this ordinance 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 3: The Mayor shall sign and the City Clerk shall attest to the passage of
this ordinance. The City Clerk shall cause this ordinance, or a summary thereof, to be
published pursuant to Charter Section 414.
This ordinance was introduced at a regular meeting of the City Council of the City
of Newport Beach, held on the 25th day of March, 2014, and adopted on the 8th day of
April, 2014, by the following vote, to wit:
AYES, COUNCILMEMBERS
NOES, COUNCILMEMBERS.
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ABSENT COUNCILMEMBERS
RUSH N. HILL, II, MAYOR
APPROVED AS TO FORM:
THE CITY ATTORNEY'S OFFICE
-- c. # °',--
AARON C. HARP, CO ATTORNEY
ATTEST:
LEILANI I. BROWN, CITY CLERK
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ATTACHMENT B
SETTLEMENT AGREEMENT AND RELEASE
This Settlement Agreement and Release ( "Agreement") is made and entered into
on February L1, 2014 ( "Effective Date ") by and between the Newport Beach Dock
Owners Association and Robert McCaffrey (collectively, "Association ") and the Newport
Beach City Council and the City of Newport Beach (collectively, "City") (together, the
"Parties ").
RECITALS
WHEREAS, the City is a municipal corporation and charter city duly organized
and existing under the laws of the State of California;
WHEREAS, the Newport Beach City Council is the elected body that represents
and governs the City under the City Charter;
WHEREAS, the Association is a California corporation composed of tidelands
users and an individual whose principal address is 1410 South Bay Front, Newport
Beach, California 92662;
WHEREAS, on February 14, 2013, the Association filed a complaint against the
City alleging a violation of the Ralph M. Brown Act relating to the City's adoption of a
resolution establishing fair market value rent for residential piers and a model residential
pier permit;
WHEREAS, the City disagrees with the Association's allegations and asserts that
it has fully complied with all requirements of the Ralph M. Brown Act; and
WHEREAS, the Parties desire to mutually resolve all disputes and differences
between them as to the claims set forth in Newport Beach Dock Owners Association, et
al, v. Newport Beach City Council, et al. (Orange County Superior Court Case No. 30-
2013- 00630419- CU- WM -CJC) ( "Litigation ").
NOW, THEREFORE, for their mutual benefit, the Parties hereby agree and
confirm that this Agreement finally resolves and satisfies all claims that were or could
have been asserted in the Litigation and agree as follows:
1. The recitals provided above are true and correct and are incorporated into
the substantive portion of this Agreement.
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2. The City will amend Newport Beach Municipal Code Subsection
17.60.030(A) to provide as follows: "upon the request of the abutting upland residential
property owner, lessee or agent of the owner, and in accordance with all applicable
laws, a residential pier permit shall be issued for up to ten (10) years. The City shall
extend the term of any residential pier permit for up to ten (10) years upon: (i) permit
expiration and the request of the owner, lessee or agent of the owner; or (ii) upon sale
of the abutting upland property and the request of the new owner, lessee or agent of the
owner. The maximum term of any permit issued hereunder, with extensions, shall be
fifty (50) years. After fifty (50) years, the abutting upland residential property owner,
lessee or agent of the owner shall be required to apply for a new residential pier permit.
A copy of the Revised Residential Tidelands Pier Permit, as adopted by Resolution No.
2013 -88, is attached to this Agreement.
3. Within five (5) calendar days of the Effective Date of this Agreement, the
Association shall dismiss the Litigation with prejudice.
4. The Parties shall bear their own attorneys' fees and costs.
5. This Agreement shall constitute a complete and final settlement of all
claims which were asserted, or could have been asserted, by the Association against
the City in the Litigation.
6. This Agreement shall not constitute an admission of evidence of any fact,
wrongdoing, misconduct, or liability on the part of the City, its officers and employees or
any person affiliated with the City.
7. For good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, Association hereby releases and forever discharges the City
from any and all actions, causes of action, suits, controversies, claims, damages and
demands, at law or in equity, that Association now has or had relating to the Litigation,
including any claim for damages, fees, or costs arising out of the Litigation.
8. This Agreement is fully binding on the Parties, their successors and
assigns, and has been reviewed by legal counsel, and the terms are fully understood
and voluntarily accepted as a complete and final settlement of any and all claims
between the Parties, including those in the Litigation.
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9. This Agreement constitutes the entire agreement between the Parties.
The individuals executing this Agreement on behalf of the respective Parties have
express and lawful authority to do so, and it may be executed in counterparts.
10. This Agreement shall be construed in accordance with the laws of the
State of California.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed on the dates written below.
APPROVED AS TO FORM:
THE CITY ATTO NEY'S OFFICE
Date: 3 zc /y
By: '49L
f
Aaron C. Harp
City Attorney
ATTEST:
Date:
Bv:
Leilani I. Brown
City Clerk
CITY:
Date:
Bv:
Dave Kiff
City Manager
ASSOCIATION;
Date: �- (Z t I Zd/ Y
Byq-
Name: Robert McCaffrey
Title: President
Date: 2 (Z l (ZO l
By:
Name:
Title:
Attachment: Revised Residential Tidelands Pier Permit
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Residential Tidelands Pier Permit
(1) Permittee: This Permit is issued on to
( "Permittee ") to construct/maintain a residential pier located upon City of Newport Beach ( "City's
tidelands, as more particularly described and depicted in Attachment 1 ( "Premises "), which is
attached hereto and incorporated by reference. By acceptance of this Permit, the Permittee
agrees to be bound by the terms contained in this Permit.
(2) Term: This Permit shall be valid for a period of _ year(s) beginning on March 1, 20
and expiring on February _, 20_, unless terminated earlier as provided herein. A new permit
may be automatically Issued upon expiration, provided rent is paid and the pier is maintained.
The City's longstanding policy is to re- issue residential permits annually to the upland property
owner, who also owns the physical dock associated with the Premises.
(3) Rent: Rent shall be calculated pursuant to Resolution No. 2013 -88, or any
successor /amended resolution. Resolution No. 2013 -88 and any successor /amended
resolution are automatically incorporated by reference into this Permit, without any further action
by the parties, when adopted by the Newport Beach City Council.
(A) Periodic Payment of Rent: One -sixth (116) of annual rent for a particular year
shall be received by the City within nineteen (19) days after the mailing of the
Municipal Services Statement to Permittee. Bi- monthly rent will be billed with the
Permittee's Municipal Services Statement.
(B) Place for Payment of Rent: All payments of rent shall be made in lawful money of
the United States of America and shall be paid to City on line at
www.newportbeachca.gov, in person or by United States' mail, or overnight mail
service, at the Cashier's Office located at 100 Civic Center Drive, Newport
Beach, CA 92660, or to such other address as City may from time to time
designate in writing to the Permittee. The Permittee assumes all risk of loss and
responsibility for late charges and delinquency rates if payments are not timely
received by the City regardless of the method of transmittal.
(C) Late Charges: A ten percent (10 %) late charge, or the maximum rate allowable
under State law, shall be added to all payments due but not received by City by
the due date.
(D) Third -Party Use: This Permit o allows / o does not allow (check one) the
Permittee to rent/lease the Premises to a third -party.
(4) Utilities and Taxes: The Permittee is solely responsible for obtaining all utilities and
paying all taxes (including possessory interest tax, if applicable), fees and assessments for the
Premises or Improvements located thereon.
(5) Maintenance: The Permittee assumes full responsibility for operation and maintenance
and repair of the Premises and associated improvements throughout the term of this Permit at
its sole cost, and without expense to the City.
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(6) Transfer /Assignment: This Permit may be transferred or assigned by the Permittee as
provided In the Newport Beach Municipal Code.
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Attachment 1
Description & Depiction of Premises
Premise's Address (or description of general location):
Premise's Square Footage:
Premise's Depiction:
fti`Ir1
ATTACHMENT C
17.60.030(A)
A. Pier Permits. Upon the request of the abutting upland residential property owner,
lessee or agent of the owner, and in accordance with all applicable laws, a residential
pier permit shall be issued for up to ten (10) years. The City shall extend the term of
any residential pier permit for up to ten (10) years upon: 0) permit expiration and the
request of the owner, lessee or agent of the owner: or (ii) upon sale of the abutting
Upland property and the request of the new owner, lessee or agent of the owner. The
maximum term of any permit issued hereunder, with extensions, shall be fifty (50) years.
After fifty (50) years, the abutting upland residential property owner, lessee or agent of
the owner shall be required to apply for a new residential pier permit. PeFmits f9F pieFs
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