Oversight Board Meeting

MINUTES OVERSIGHT BOARD SPECIAL MEETING Wednesday, May 8, 2013 – 6-8 p.m. COUNCIL CHAMBER, FEW MEMORIAL HALL OF RECORDS MONTEREY, CALIFORNIA Oversight Board Members Present: Chip Rerig, Mitch Winick, Harvey Kuffner, Michael Adamson, and, Chuck Della Sala Absent: Stephen Ma City Staff Present: Assistant Finance Director Julie Porter, Kim Bui-Burton, Conference Center Director, Housing and Property Manager Rick Marvin, Legal Counsel Richard Glenn, and Secretary to Board, Maria Buell CALL TO ORDER Chair Rerig called the meeting to order at 6:00 PM. APPROVAL OF MINUTES 1. The Minutes of the April 10, 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 8th day of May, 2013 by the following vote: vote: AYES: 6 MEMBERS: Rerig, Winick, Adamson, Kuffner, Della Sala, Potter NOES: 0 MEMBERS: None ABSENT: 1 MEMBERS: Ma ABSTAIN: 0 MEMBERS: None PUBLIC APPEARANCE 2. Receive Report on Initial Analysis of Former City of Monterey Redevelopment Agency Property Transfers. Staff Presentation/Board Member Questions Staff member Rick Marvin introduced this item and answered Board member questions. Mr. Marvin presented a power point summary and stated that this item is not intended for action yet. All the former RDA properties are properties that were purchased by RDA. The purpose is to introduce the Board to all RDA properties. DOF’s decision on DDR submitted will determine the final list of properties subject to final review of the OB and Property Management Plan. That list will identify those properties pursuant to the Dissolution Act. Staff has identified 12 properties (conservatively) and only one (1) has been identified as a housing asset (Osio plaza) and therefore is off the list. Six (6) were purchased by City and a Bond completed this purchase. Twelve (12) are enforceable obligations and ten (10) have a “government 1 purpose” which will allow its transfer to City of Monterey. These properties can be processed in this format with DOF. Staff feels it is consistent with current law and the Successor Housing Agency should take ownership of these properties. Staff concluded that the early payoff of the bond was not a violation of Section 34163. Seven (7) of the properties need to be transferred to City as enforceable obligations: five (5) per lease agreements; one (1) to Urban Renewal Development; and one (1) pursuant to Ground lease (5 Custom House). Ten (10) fall under government purpose and can be transferred to City: two (2) walkways, one (1) to Osio Plaza and the walkway adjacent to MOM connecting Marina parking lot to Alvarado Street; Del Monte properties which were purchased for Window on the Bay; Hartnell Gulch provides a natural flood control and the Hilltop recreation center; two (2) are less clear but they still fit under government purpose criteria. The list of properties was submitted to DOF and staff is awaiting a decision. If these properties are deemed not transferrable, then they become part of a Community Redevelopment Property Trust Fund to be administered by SA. Chair Rerig asked Mr. Marvin to describe a possible scenario if one of the properties does not get approved by DOF and becomes part of the Community Redevelopment Property Trust Fund. Staff member Marvin stated that the title would be held by the SA and it would be responsible for this property. SA has to develop a long range Property Management Plan (Plan). This Plan requires OB to review and approve it within 6 months after DOF provides its determination. DOF will then give its final approval after OB does its own. The property would have to be used in the manner or disposed in the manner defined. Some properties can be retained for government purpose: to fulfill an enforceable obligation; or retained for future development. All other properties must be liquidated and monies distributed to the appropriate taxing agencies. Staff concluded that no property should be liquidated. Seven (7) qualify as enforceable obligations and therefore transferrable to City. The proceeds must be used for CDBG program income; Hotel Pacific is an enforceable obligation which needs to be transferred; finally, if unsuccessful, 10 qualify as “government purpose” and must be transferred to City. Mr. Marvin referred Board members to the attachments in the report for further information. Public Comments: Chair Rerig opened discussion to members of public on this item. Having no requests to speak, Chair Rerig closed public comment. Board Member Comments: Board member Della Sala asked for the date DOF will be approached. Staff member Marvin said staff is waiting on DOF to provide a final determination of the DDR on non-housing assets; once received, staff will be able to see which properties must be reviewed and under what priorities. These properties will be “classified” and each will have to have an analysis based on value; he projects that an appraisal will be done and that it might be a requirement. Board member Kuffner asked if DOF makes determinations regarding these properties will OB then review their determinations? He also asked if staff is doing all the analysis and appraisals before or after they go to DOF. Staff member Marvin said that they are already looking at the properties identified as “non-housing assets” submitted to DOF. Six (6) were identified as belonging to City; City is on “waiting” mode. Assistant Finance Director Porter said staff is awaiting their response to see if they agree with their assessment on these properties. Staff is required to do an initial analysis. The long range property management plan will be brought to OB for approval. DOF will look at these properties again. Board member Kuffner asked if this is “kind of a Loop.” And that staff is then not sure how many more “loops” will take place before final approval is given. Board member Potter said he had a question and an observation: the hotel would go back to the argument around and around; but hard to assess the value? Staff member Marvin said that assessing the value might not be difficult. Staff believes it falls under government purpose because of agreements that subjects revenue for a very specific purpose (CDBG). 2 Staff’s position is that City is the best agency to continue doing this. Board member Potter asked if this would be a “traceable trail”? Staff member Marvin responded affirmatively regarding the community funds. Counsel Glenn said that the OB role is significant through these next two steps; this next period will be perhaps managed by the Countywide Oversight Board in 2016. Counsel Glenn said staff did a good job and initial analysis of the properties. Mr. Glenn said he spoke with the Assistant City Attorney in Santa Barbara as they are faced with similar issues as our City’s. Counsel Glenn said that this is a present issue with other parking structures in other cities and that City’s position is good. Cannery Row has several parking areas and it has a high value. County Assessor told Mr. Glenn to provide objective formal valuation opinions to City in regards to these high value assets. Mr. Glenn asked Board if he could follow up on this as he feels that the Cannery Row parking structure is worth looking at. Staff member Marvin said that outside counsel already concluded it was a “government purpose use.”Mr. Glenn agreed with Staff on position taken and that the Museum is considered a government use. Mr. Glenn commended staff for the report, but wants OB to look at the parking structure in Cannery Row. Board member Potter asked if Mr. Glenn needs specific direction from OB in order to talk to Monterey County Assessor. Chair Rerig said that informally, OB can give this direction to Counsel and would not oppose taking action. Mr. Rerig stated it should be added to next agenda. Board Member Rerig introduced Kim Bui Burton to Oversight Board. Ms. Bui-Burton introduced herself as the Community Services and Library Director. She oversees the Conference Center, Parking, Recreation and Sports Center and manages half of the properties impacted on this list. Board member Kuffner asked if the Cannery Row parking structure is the only one that needs a formal valuation. Counsel Glenn said that maybe staff could also provide Board with an acceptable appraisal in lieu of something formal. He is concerned about the expense and wants to use Monterey County Assessor instead. Board Kuffner asked if the conference center is considered an asset that must be included. Counsel Glenn said that Conference Center is definitely a public use and serves the public /community. Board member Rerig asked Mr. Marvin to bring back some ground findings that support this list. Mr. Marvin stated that staff will convince DOF that this property is already transferred. The Bond was paid in 2005 pursuant to a facilities lease agreement which required it to be transferred to City after bond was paid off. Board member Rerig: Opens for public comment. Public Comments: Chair Rerig opened discussion to members of public on this item. Having no requests to speak, Chair Rerig closed public comment. 3. Regular Scheduled May 22, 2013 Meeting is cancelled and next meeting is scheduled on June 26, 2013. PUBLIC COMMENTS No member of the public provided input. Public Comments closed. OTHER BUSINESS 3 BOARD MEMBER COMMENTS Board member Adamson said he read that State is considering re-introducing the RDA. Staff member Marvin said State is looking at ways of providing funding for affordable housing; not necessarily putting the redevelopment agencies back. Counsel Glenn said he heard some other formats to add tax increments back. Board member Potter said that there are currently 4 bills moving forward; some very specific and others trying to reinvent the redevelopment agencies. He speculates that Governor Brown will not support a “re-start and that there are a lot of communities having the same challenges our City has. ADJOURNMENT There being no further business, the meeting adjourned at 6:49 PM. Respectfully Submitted, Approved, _______________________ _______________________ Maria Buell Chip Rerig Secretary, Oversight Board Chair, Oversight Board 4