Oversight Board Meeting

MINUTES OVERSIGHT BOARD MEETING Wednesday, January 23, 2013 – 7-9 p.m. ORCA Conference Room 735 Pacific Street MONTEREY, CALIFORNIA Oversight Board Members Present: Chip Rerig, Mitch Winick, Harvey Kuffner, Michael Adamson, Stephen Ma, Dave Potter Absent: Chuck Della Sala City Staff Present: Finance Director Don Rhoads, Housing and Property Manager Rick Marvin, City Attorney Christine Davi, Julie Porter, Assistant Finance Director, Legal Counsel Richard Glenn, and Secretary to Board, Maria Buell. CALL TO ORDER Chair Rerig called the meeting to order at 7:02 PM. APPROVAL OF MINUTES 1. The Minutes of the January 9, 2013 meeting were approved by the following vote: ADOPTED BY THE OVERSIGHT BOARD OF THE SUCCESSOR AGENCY OF THE CITY OF MONTEREY REDEVELOPMENT AGENCY this 23rd day of January 2013, by the following vote: AYES: 4 MEMBERS: Rerig, Adamson, Ma, Kuffner NOES: 0 MEMBERS: None ABSENT: 2 MEMBERS: Della Sala, (Potter arrived after approval of Minutes) ABSTAIN: 1 MEMBERS: Winick PUBLIC APPEARANCE 2. Approve Successor Agency Authorized Lease Amendment for Monterey History and Art Association at 5 Custom House Plaza Staff Presentation/Board Member Questions Staff member Marvin presented the staff report and answered board member questions. He provided a brief background to this Lease: the Monterey Maritime Museum of Monterey (now Museum of Monterey) is adjacent to Custom House plaza; a lease amendment was requested to provide flexibility in the operation of the museum and allow them to better implement a new vision and business plan. The lease was transferred to the Successor Agency (SA) upon the dissolution of the RDA. The SA considered the Lease amendment and approved the requested modifications that were proposed for the purpose of the improving of business operations, increasing revenues and implementing a new vision for the museum. 1 Mr. Marvin stated staff had determined the action of the SA to amend the lease was consistent with Health and Safety Code Section 34181(e) in regards to administration of real property assets. Mr. Marvin acknowledged that Oversight Board (OB) Counsel Glenn interpreted the SA action differently. City Attorney Davi stated that more discussion with OB Counsel Glenn is needed regarding his concerns before the OB should take action on this item. She indicated a meeting with Mr. Glenn would be scheduled. Ms. Davi indicated a decision was not urgent at this time and that the decision could be postponed. Chair Rerig reminded the Board that City Attorney Davi represents SA only. OB Counsel Glenn said the OB should have a clear understanding of the management and disposition aspects of the former RDA real property assets through the unwind process before completing any decisions relating to real property. Mr. Glenn recommended the OB bring this property decision back for further discussion at a future meeting. Board member Kuffner asked Mr. Glenn if the issue is not being made more complicated than what it already is. Counsel Glenn answered that real estate issues need further analysis and he recommends the OB take its time to clearly understand the issues prior to decisions. Board member Kuffner asked if City collects $1/year from Museum and if the mission of the Museum had changed. Staff member Marvin confirmed the amount of rent collected by City and stated that amendment was supported because staff was concerned over the perception that the operation of the Museum had changed. Mr. Marvin said the intent of the lease amendment was to ensure the museum vision aligned with the use requirements in the Lease. Board member Kuffner asked if the purpose of changing internal operations is to improve the financial viability of the museum. Staff member Marvin answered affirmatively and that conclusion had been presented to the SA. Board member Adamson asked what changes were made by the Museum. Staff member Marvin said changes included modification of museum hours, recognition of changes in museum displays such as representations of more than just Monterey maritime history and changes to the type and content of the products sold in the Museum store. Board member Ma asked if staff knew how DOF reviews real estate transfers and ROPs. OB Counsel Glenn said that DOF has a 60-day review process, and if no reaction is received from them then they become effective. Mr. Marvin stated staff needs to inform the DOF and other agencies anytime actions are taken by Oversight Board and actions must be documented by resolution but specific criteria for evaluating real estate determinations is unknown at this time. Board member Winick said that Counsel Glenn’s concern appears to be that OB should not “set precedent” and then be questioned later. If OB agrees with Mr. Glenn, would it be possible that OB can say it’s an appropriate government use. Counsel Glenn stated that it is his understanding that the museum changes should go forward between City and Museum and then the OB can follow its own process. He further stated that a determination does not have to be made tonight and that Staff could begin working on how all governmental or public use can best be incorporated into the real estate disposition analysis. Chair Rerig asked how many more properties are involved. Staff member Marvin said 9 or so properties and that Staff is gathering all the documents to be presented at a future meeting. 2 Chair Rerig asked what the posture should be in taking the Lease language verbatim and not allow the State to liquidate this asset and asked if other jurisdictions have threaded this already. OB Counsel Glenn responded that he was not aware of any transfers of this type that had been reviewed by DOF. Chair Rerig stated that there appeared to be no eminent deadline on this item and asked if staff would be adverse to tabling the item until City Attorney Davi and OB Counsel Glenn meet. Staff member Marvin said that Staff agrees that more discussion on real property matters is needed, even if it takes more time. MOTION: On a motion by Board member Winick, seconded by Board member Kuffner, the Board unanimously moved to table the Approval of Successor Agency Authorized Lease Amendment for Monterey History and Art Association at 5 Custom House Plaza. ADOPTED BY THE OVERSIGHT BOARD OF THE SUCCESSOR AGENCY OF THE CITY OF MONTEREY REDEVELOPMENT AGENCY this 23rd day of January 2013, by the following vote: AYES: 6 MEMBERS: Rerig, Winick, Ma, Kuffner, Adamson, Potter NOES: 0 MEMBERS: None ABSENT: 1 MEMBERS: Della Sala ABSTAIN: 0 MEMBERS: None Public Comments: Chair Rerig opened discussion to members of public on this item. Having no requests to speak, Chair Rerig closed public comment. PUBLIC COMMENTS No member of the public provided input. Public Comments closed. OTHER BUSINESS 3. Executed January 9, 2013 Resolution BOARD MEMBER COMMENTS Finance Director Rhoads was asked if they had received any communications from DOF. He stated that a new format for ROPS 4 was just disclosed and that he would share it at the next meeting. Board member Kuffner asked if there were any meet and confer meetings coming up. Staff member Marvin stated that the next meet and confer meeting with DOF is scheduled for February 4th and he would attend by himself. Mr. Marvin indicated he would provide an update at the next meeting. ADJOURNMENT There being no further business, the meeting adjourned at 7:41 PM. Respectfully Submitted, Approved, _______________________ _______________________ Maria Buell Chip Rerig Secretary Oversight Board Chair, Oversight Board Next Oversight Board meeting is scheduled for February 27, 2013, at 7:00 PM. 3