CITY OF POMONA
COUNCIL REPORT
May 6, 2024
To: Honorable Mayor and Members of the City Council
From: Anita Gutierrez, City Manager
Submitted By: Kirk Pelser, Economic Development Director SUBJECT: APPROVAL OF AN EXCLUSIVE NEGOTIATION AGREEMENT WITH NATIONAL COMMUNITY RENAISSANCE OF CALIFORNIA, ARTECO, AND VILLAGE PARTNERS FOR THE SALE AND DEVELOPMENT OF VEHICLE PARKING DISTRICT LOTS 6 & 7 AND ADJACENT VEHICLE PARKING DISTRICT OWNED PARCELS ON THE 400 BLOCK OF WEST 2ND STREET RECOMMENDATION:
It is recommended that the City Council:
Approve the attached Exclusive Negotiation Agreement (ENA) with National Community Renaissance of California, Arteco & Village Partners (Developer) regarding the sale of Vehicle Parking District (VPD) Lots 6 & 7 and adjacent VPD owned parcels Generally Located on the 400 Block of West 2nd Street.
Authorize the City Manager to execute the ENA in substantially the form as attached (Attachment No. 2) and subject to approval as to form by the City Attorney.
EXECUTIVE SUMMARY:
The City Council will consider approval of an ENA with the Developer. The terms of the ENA include consideration of sale of the parcels owned by the City/VPD The City/VPD owns Parking Lots 6 & 7 and adjacent vacant property and one commercial building, collectively the Downtown Development Opportunity Site (the “Development Site”). This Development Site had previously been committed to a proposed Maya Cinema project, which ultimately proved infeasible and the related sales agreement with Maya was terminated in 2021. In March of 2022, the Council approved a Request for Qualifications/Proposals (RFQ/P) process with the intent of selecting an experienced development partner to acquire the Development Site and to develop it in a manner that is consistent with Pomona’s vision for the downtown as expressed in the adopted General Plan and The Downtown Pomona Specific Plan. Sale of the Development Site must also comply with the requirements of the State’s Surplus Land Act, which provides for an exemption if a site can accommodate development that will yield at least 300 residential units, with not less than 25% of the units restricted to low or very-low income households.
The RFQ/P process initially yielded three responses, with the Council ultimately selecting a Developer team in February of this year. Staff is now recommending that the Council approve an ENA with the selected Development Team of Village Partners/Arteco Partners/National CORE to move forward to the next phase, which is negotiation of a Disposition and Development Agreement (DDA).
FISCAL IMPACT:
If approved, the terms of the ENA require Developer to make a $25,000 deposit to cover the City’s legal and consultant costs related to the negotiations that occur during the period of the ENA.
SB1439/GOVERNMENT CODE §84308 APPLICABILITY:
☐ When this box is checked, it indicates the agenda item is subject to the Levine Act SB1439 requirements. Councilmembers are reminded to check their campaign contributions and determine whether they have received a campaign contribution of $250 or more that would require disclosure and/or recusal from discussing or acting on this agenda item. Campaign contributions of $250 or more made 1) by any person or entity who is identified in the agenda report as the applicant or proposer; or 2) on behalf of the applicant or participant, including a parent, subsidiary or otherwise related business entity; or 3) by any person who has a financial interest in the agenda item requires a councilmember to comply with SB1439.
DISCUSSION:
The City currently owns and operates 25 Vehicle Parking District parking lots throughout the Downtown. The District was created between 1951 and 1958, as separate districts and later amended and combined. The District was created to provide equitable and adequate parking to all Downtown businesses, property owners and stakeholders. Since its inception, the character, land uses, boundaries and businesses in the area have changed and/or evolved. Businesses and land uses in certain areas of the Downtown that once required public parking no longer exist, uses have changed, or businesses provide their own private parking.
The City Council has expressed a desire to see new and innovative mixed-use development in the Downtown. The subject Development Site is comprised of Parking Lots 6 & 7, adjacent vacant property and one commercial building and was previously intended for development of a multi-screen cinema project with ancillary commercial retails uses. The previously planned cinema project proved infeasible and in 2021 the Council terminated the related prior agreement to sell the property. In an effort to accommodate new development, the Council directed staff to prepare a competitive RFQ/P process with the intent of selecting a highly qualified and experienced development partner to acquire the Development Site and to articulate a vision and scope for its development in a manner consistent with Pomona’s General Plan and the Downtown Specific Plan.
The sale of surplus land by a City is largely governed by the State’s Surplus Land Act (SLA) as found in Government Code Section 54220 et seq. In 2019, Assembly Bill No. 1486 was adopted, which amended certain sections of the Surplus Land Act relating to the sale of surplus property. These amendments went into effect on January 1, 2020. The SLA defines surplus land as “land owned in fee simple by any local agency for which the local agency’s governing body takes formal action in a regular public meeting declaring that the land is “surplus” and not necessary for the agency’s use”. The declaration process is required to be supported by written findings. Additionally, AB 1486 amends the SLA by prohibiting local agencies from negotiating land sales and leases of surplus land prior to sending out “Notices of Availability” to designated entities which must including the following:
• California Department of Housing and Community Development (HCD) • Local public entities within the jurisdiction where the surplus land is located. • Developers who have notified HCD of their interest in developing affordable housing on surplus land.
However, the SLA does provide exemptions in certain circumstances for sale of surplus land, including surplus land that is put out to open, competitive bid by a local agency, provided all entities identified in subdivision (a) of Section 54222 will be invited to participate in the competitive bid process, for … [a] mixed-use development that is more than one acre in area, that includes not less than 300 housing units, and that restricts at least 25% of the residential units to lower income households, as defined in Section 50079.5 of the Health and Safety Code, with an affordable sales price or an affordable rent, as defined in Sections 50052.5 and 50053 of the Health and Safety Code, for a minimum of 55 years for rental housing and 45 years for ownership housing” (Government Code section 54221(f)(1)(F)(ii)) (the “SLA Exemption”).
The subject Development Site can accommodate the above described requirements for exemption to the SLA process and the RFQ/P expressly incorporated the applicable requirements.
The Table below lists all of the parcels that comprise the Development Site.
Site Address
APN
Site Name
Zoning
Square Feet
400 W. 2nd St
8341-003-902
“Gist” Building
Specific Plan
4,471
8341-003-903
Vacant land
Specific Plan
2,957
8341-003-904
Vacant Land
Specific Plan
2,515
8341-003-905
Vacant Land
Specific Plan
5,367
8341-003-906
Vacant Land
Specific Plan
2,657
8341-003-907
Vacant Land
Specific Plan
5,261
8341-003-908
Vacant Land
Specific Plan
2,300
8341-003-909
Vacant Land
Specific Plan
5,246
8341-003-901
Public Parking Lot # 6
Specific Plan
30,855
8341-004-902
Public Parking Lot # 7
Specific Plan
31,324
When approving the RFQ/P in March 2022, the Council adopted Resolution No. 2022-53, declaring the subject property as exempt surplus property per Government Code 54221. This process included a required Notice of Availability, which was sent via email to all parties then registered with the State Department of Housing & Community Development (HCD).
The ENA will provide for a twelve month initial term for negotiations with one ninety day extension, if necessary, and at the sole discretion of the City Manager. Staff will endeavor to bring back a comprehensive DDA for Council consideration as soon as feasible and hopefully well in advance of the ENA’s time allowance. During this time the Developer will refine the project scope and financial proforma. A summary of the proposed project can be found in Attachment No. 1 with the below general characteristics:
Approximately 330,000 square feet and up to five stories 351 rental apartments and live work units
81 affordable units with income restrictions from 30-80 of AMI National CORE residential services
15,000 square feet of storefront retail/restaurants
2,000 square feet of community space/art galleries and co-working center 21,000 square feet of new and retrofitted public plazas 450 parking stalls on site including 116 City controlled VPD stalls ENVIRONMENTAL ANALYSIS:
Pursuant to section 15061(b)(3) of the CEQA Guidelines, it can be seen with certainty that there is no possibility that entering into an ENA regarding the subject Property will have a significant effect on the environment and, therefore, approval of the ENA is not subject to CEQA. The proposed ENA concerns merely the consideration of disposition of property, and any entitlements, change in use, or similar alternation to the Property will be subject to future discretionary action by the Pomona City Council and/or Planning Commission, as applicable.
COUNCIL PRIORITIES & GOALS:
City Council Priority 2: Economic Development – Goal J: Encourage the development and maintenance of quality housing opportunities for all.
Prepared by:
_____________________________
Kirk Pelser
Economic Development Director
ATTACHMENT(S):
Attachment No. 1 – Preliminary Conceptual Site Plan
Attachment No. 2 – Exclusive Negotiation Agreement
65318.50901\34784169.1
65318.50901\34784169.1
65318.50901\34784169.1
65318.50901\34784169.1
Approval of an Exclusive Negotiation Agreement