Resolution No. 2023-XX
A Resolution of the City Council of the City of FONTANA (“cITY”) APPROVING THE THIRD AMENDMENT TO THE OPERATING COVENANT AGREEMENT BETWEEN THE CITY OF FONTANA AND THE FONTANA WOMAN’S CLUB, A CALIFORNIA DOMESTIC NONPROFIT, TO BRING current THE INSTALLMENt schedule as set forth in the second amended operating COVENANT and to effectuate conditions for repayment forgiveness thereof WHEREAS, the Fontana Woman’s Club (“Owner”), a California Domestic Nonprofit, is the owner of that certain real property located at 16880 Seville Avenue, Fontana, CA 92335 (“Property”), on which Owner plans to open a high quality, upscale restaurant while preserving the historical character of the building; and, WHEREAS, the City and Owner have negotiated an Operating Covenant Agreement (“Agreement”) designed to ensure that Fontana Woman’s Club opens a high quality, upscale restaurant, currently identified as “Spaggi’s”, or such other restaurant as listed in the agreement or as approved by the City Manager (the “Business”) in Fontana; and, WHEREAS, On March 25, 2021, the Parties entered into a Second Amendment to the Operating Covenant Agreement (the “Second Amendment”),which established a fixed loan, and repayment schedule, from the City to the Owner, to continue the maintenance and operations of the Fontana Woman’s Club; and; WHEREAS, the City desires to bring current the fixed loan installment schedule as set forth in the Second Amendment and desires to effectuate conditions for repayment forgiveness of the loan in exchange for a minimum level of annual sales tax revenue generated by the restaurant, in a Third Amendment to the Operating Covenant Agreement; and, WHEREAS, the City has determined that Owner’s operation of the business will result in substantial benefits to the City and its citizens including, without limitation, the creation of new employment opportunities, property tax revenues, sales tax revenues and other ancillary benefits. Accordingly, the City has also determined that the Operating Covenant Agreement serves a significant public purpose, while providing only incidental benefits to a private party; and, WHEREAS, pursuant to the California Environmental Quality Act (Public Resources Code, § 21000 et seq.) and the State CEQA Guidelines (California Code of Regulations, title 14, § 15000 et seq.) (collectively, “CEQA”), the City is the lead agency for the proposed Project, and WHEREAS, in accordance with CEQA, the City has determined that approval of the Project is exempt from requirements of CEQA pursuant to State CEQA Guidelines sections 15331, 15332, and 15301, and, WHEREAS, on July 25, 2023, the City Council of the City of Fontana conducted a public hearing to consider the Third Amendment to the Operating Covenant between the City and Owner and concluded said hearing on that date.
Now, Therefore be it Resolved by the City Council of the City of Fontana, California, as follows:
Section 1: Recitals. The above Recitals are true and correct and by this reference incorporated herein.
Section 2: CEQA. Compliance with the California Environmental Quality Act. Based upon its review of the entire record before it, the City Council hereby finds and determines that the proposed Project is categorically exempt from environmental review under CEQA pursuant to State CEQA Guidelines sections 15331 (Class 31 exemption), 15332 (Class 32 exemption), and 15301 (Class 1 exemption).
The Class 31 exemption applies to, among other things, the maintenance, rehabilitation, restoration, preservation, conservation or reconstruction of historical resources in a manner consistent with the Secretary of the Interior’s Standards for the Treatment of Historic Properties with Guidelines for Preserving, Rehabilitating, Restoring, and Reconstructing Historic Buildings. The proposed Project here qualifies for a Class 31 exemption because its purpose is to maintain, rehabilitate, restore, preserve, and reconstruct the Woman’s Club (an historic resource) in accordance with the Secretary of the Interior’s standards. (See ARG Rehabilitation Study for Fontana Woman’s Club Building, pp. 79-106.) More specifically, ARG recommended rehabilitation of the Woman’s Club Building as the overall treatment approach because the building possesses a high level of historic significance yet is suffering from years of deferred maintenance. (Id. at p. 79.) The Secretary of Interior’s Standards of Rehabilitation serve as the basis and guide for all treatment recommendations put forth by ARG. (Id. at pp. 79-80.) For these reasons, the proposed Project is exempt from further review under CEQA. This exemption alone is sufficient to independently exempt the whole of the Project.
Additionally, and in the alternative, the Project is exempt pursuant to State CEQA Guidelines section 15332, which exempts infill development within urbanized areas. The Project is consistent with the local General Plan and zoning requirements. It occurs within City limits on an existing site of no more than 5 acres substantially surrounded by urban uses. The Project site has no value as habitat for endangered, rare or threatened species. The Project would not result in any significant, traffic, noise, air quality or water quality impacts, as the proposed restaurant use is consistent with the current assembly use of the Woman’s Club as a catering and special events operation. Finally, the Project can be adequately served by all required utilities and public services. Accordingly, the Project is exempt under State CEQA Guidelines section 15332. For these reasons, the proposed Project is exempt from further review under CEQA. This exemption alone is sufficient to independently exempt the whole of the Project.
Finally, and also in the alternative, the Project is exempt under State CEQA Guidelines section 15301, which , among other things, exempts the operation, repair, maintenance, or minor alterations of existing public or private structures and facilities, where such activity involves negligible or no expansion of existing use. The Project qualifies for the Class 1 exemption because it proposes to rehabilitate the interior of the existing Woman’s Club building, with negligible or no expansion of existing use. For these reasons, the proposed Project is exempt from further review under CEQA. This exemption alone is sufficient to independently exempt the whole of the Project.
Furthermore, none of the exceptions to the exemptions under State CEQA Guidelines § 15300.2 apply. The Project will not result in a cumulative impact from successive projects of the same type in the same place, over time. Similarly, there are no unusual circumstances surrounding the Project that result in a reasonable possibility of a significant effect on the environment. The Project site is currently developed, there are no endangered species or wetlands on site. The proposed restaurant use of the Woman’s Club is consistent with the current assembly use as a catering and special events operation. Further, the rehabilitation and improvements would take place on the interior of the existing building. Likewise, the Project will not damage scenic resources, including trees, historic buildings, rock outcroppings, or similar resources, as the site is already developed. Moreover, the proposed Project site is not included on a list compiled pursuant to Section 65962.5 of the Government Code. Finally, the proposed project would not cause a substantial adverse change in the significance of an historical resource. Specifically, even though the Woman’s Club is listed as a California Point of Historical Interest and a City of Fontana Landmark on the City’s local inventory, the proposed project would not result in a substantial adverse change in the significance of the resource. Specifically, the Project would not (A) demolish or materially alter in an adverse manner those physical characteristics of the historical resource that convey its historical significance and that justify its inclusion in, or eligibility for, inclusion in the California Register of Historical Resources; or (B) demolish or materially alter in an adverse manner those physical characteristics that account for its inclusion in a local register of historical resources pursuant to section 5020.1(k) of the Public Resources Code or its identification in an historical resources survey meeting the requirements of section 5024.1(g) of the Public Resources Code; or (C) demolish or materially alters in an adverse manner those physical characteristics of a historical resource that convey its historical significance and that justify its eligibility for inclusion in the California Register of Historical Resources as determined by a lead agency for purposes of CEQA. (State CEQA Guidelines, § 15064.5(b)(2)(A)-(C).) (See ARG Rehabilitation Study for Fontana Woman’s Club Building.) Finally, because the proposed Project follows the Secretary of Interior’s Standards for the Treatment of Historic Properties with Guidelines for Preserving, Rehabilitating, Restoring, and Reconstructing Historic Buildings or the Secretary of the Interior’s Standards for Rehabilitation and Guidelines for Rehabilitating Historic Buildings (1995), Weeks and Grimmer, the City Council finds that the proposed Project would not have a significant impact on the historical resource. Thus, Classes 31, 32, and 1 exemptions apply, and no further environmental review is required.
Section 3: Findings. The City Council hereby finds that:
Entering into the Third Amendment to Operating Covenant Agreement will serve the following public purposes:
Opening the business within the City will create jobs and maintain economic diversity in the community by generating new opportunities for economic growth with the City; and Opening the business within the City will generate revenue for the City, allow for the retention of jobs, and assist in revitalizing the downtown area of Fontana; and , Opening the business may attract additional businesses and investment in the community due to increased services and economic activity in the area.
Based upon these and other public benefits, the public purposes of the agreement outweigh any private benefit to private persons or entities.
Opening the business will ensure the continued receipt of sales tax revenues generated by the Business for a period of ten (10) years.
Section 4: Approve Agreement. The City Council hereby approves the Third Amendment to the Operating Covenant Agreement attached to this Resolution as Exhibit A. The City Council hereby authorizes the City Manager, with the concurrence of the City Attorney, to execute said Agreement. City Manager is hereby authorized to take any additional steps necessary to facilitate the intention of this action.
Section 5: Implementation. The City Manager or his or her designee is hereby authorized and directed to, on behalf of the City, execute any and all documents in accordance with this Resolution and applicable law.
Section 6: Severability. If any provision of this Resolution or the application of any such provision to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of this Resolution that can be given effect without the invalid provision or application, and to this end the provisions of this Resolution are severable. The City declares that it would have adopted this Resolution irrespective of the invalidity of any particular portion of this Resolution.
Section 7: Certification. The City Clerk shall certify to the adoption of this Resolution.
Section 8: Effective Date. This Resolution shall become effective immediately upon its adoption.
Section 9: Custodian of Records. The documents and materials that constitute the record of proceedings on which this Resolution and the above findings have been based are in the Development Services Organization, Planning Department, located at 8353 Sierra Avenue, Fontana, CA 92335.
APPROVED and Adopted on this 25th day of July, 2023.
READ AND APPROVED AS TO LEGAL FORM:
City Attorney
I, Germaine McClellan Key, City Clerk of the City of Fontana, and Ex-Officio Clerk of the City Council, do hereby certify that the foregoing resolution is the actual resolution duly and regularly adopted by the City Council at a regular meeting on the 25th of July, 2023, by the following vote to wit:
AYES:
NOES: ABSENT: ABSTAIN:
City Clerk of the City of Fontana
Mayor of the City of Fontana
ATTEST:
City Clerk
Exhibit “A”
Third Amendment to the Operating Covenant Agreement
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Resolution No. 2023-XXX
Resolution No. 2023-XXX