Mayor Alice Patino
Mayor Pro-Tem Gloria Soto
Councilmember Mike Cordero
Councilmember Carlos Escobedo
Councilmember Maribel Aguilera-Hernandez
CITY COUNCIL AGENDA
CITY OF SANTA MARIA, CALIFORNIA
Tuesday, August 20, 2024
CLOSED SESSION - 4:15 P.M.
REGULAR SESSION - 5:30 P.M.
Oral Comments during the meeting:
In-person format. Attend the meeting in-person in the City Hall Council Chambers at 110 East Cook Street, Santa Maria, and submit a request to speak to the Clerk or City staff. •
Zoom Meeting Portal. Participate via Zoom to register to speak during the Public Comment portion of the meeting or on a particular Agenda Item. Use the Zoom link below or dial-in via telephone.
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Zoom link: https://us02web.zoom.us/webinar/register/WN_UUbd6Z-vS3iUFxekkK6J4Q Dial Phone #: 1-669-900-9128**
Webinar ID #: 844 9883 8310
**Press *6 to un-mute your phone. Press *9 to raise your hand to speak.
Watch an instructional Video on Participating using Zoom.
Public Written Comments prior to the meeting (must be received by 2:00 p.m. in advance of the meeting*):
Email - Submit Comments via email to [email protected]. In the body of your email, please include the date of the meeting and the item number (if applicable). Emails will not be read aloud during the meeting.
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Mail - Delivered by the U.S. Postal Service. Address letters to the City Council, Attn.: City Clerk's Office at 110 East Cook Street, Santa Maria, CA 93454. Letters will not be read aloud during the meeting.
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*All written correspondence will be distributed to Councilmembers and attached to the associated meeting agenda (under Public Comment or Agenda Item); however, submissions received after the deadline will not be processed until the following day.
How to watch the meeting from home:
Comcast Channel 23 - Live during the meeting, and rebroadcast on Thursday at 9:00 a.m. after the meeting and again on Tuesday at 5:30 p.m. the following week.
1. Live Webcast - Online from the Agenda Center & Meetings Portal (select meeting date) or at https://video.isilive.ca/santamaria/live.html. Note - When no meeting is streaming, the window will read "Searching for live stream."
2. You Tube Live Stream - You Tube Webcast.
Note: Live Webcast and You Tube Live are typically available within 15 minutes before the start of the meeting. There is a delay of about 15-30 seconds with both the Live Webcast and You Tube Live Stream.
3. Zoom Meeting Portal - Registration is required (link above) even for observing the meeting.4.
American Disability Act Accommodations:
Any member of the public who needs accommodations should email the City Clerk’s Office at [email protected] or call 805-925-0951 x2306. The City Clerk’s Office will use its best efforts to provide reasonable accommodation by request at least 48 hours ahead of the meeting.
CLOSED SESSION
1. CALL TO ORDER
ROLL CALL: Councilmember Aguilera-Hernandez, Councilmember Cordero, Councilmember Escobedo, Mayor Pro Tem Soto, and Mayor Patino
2. PUBLIC COMMENT PERIOD
In-person oral comments will be accepted during this time. There is no Zoom participation available for the Closed Session Public Comment period. Written comments may be submitted per the instructions above.
3. RECESS-CLOSED SESSION
The City Council will immediately recess to a closed session for the following:
3.a Conference with Labor Negotiators, Pursuant to California Government Code §54957.6
Agency Representatives: Interim City Manager Alex Posada, Interim Human Resources Officer Dawn Jackson, and Negotiations Team.
Employee Organizations: All bargaining units, unrepresented employees, managers, and executives.
3.b Public Employee Recruitment - City Manager, Pursuant to California Government Code §54957(b)(1)
3.c Public Employee Performance Evaluation, Pursuant to California Government Code §54957(b)(1)
Title: Interim City Manager & City Attorney
4. RECONVENE TO OPEN SESSION
OPEN SESSION - 5:30 P.M.
5. INVOCATION
6. PLEDGE OF ALLEGIANCE
7. CALL TO ORDER
ROLL CALL: Councilmember Aguilera-Hernandez, Councilmember Cordero, Councilmember Escobedo, Mayor Pro Tem Soto, and Mayor Patino
8. REPORT BY THE CITY ATTORNEY FROM CLOSED SESSION
9. PROCLAMATIONS
9.a Proclamation – “Women’s Equality Day” – August 26, 2024 The City Council will present a Proclamation recognizing August 26, 2024, as “Women’s Equality Day” in the City of Santa Maria.
9.b Proclamation – "Library Card Sign-Up Month" - September 2024 The City Council will present a Proclamation to recognize September 2024 as "Library Card Sign-Up Month" in the City of Santa Maria.
10. PRESENTATIONS
10.a Santa Maria’s Hometown Heroes
The City Council will receive a presentation of the Summer 2024 Class of Honorees for the Hometown Heroes program, recognizing Santa Maria residents who are actively serving in the military, veterans of the United States military, first responders, or essential workers. This recognition will include the display of a celebratory banner featuring the honoree’s photograph and branch or classification of service.
10.b Caltrans Clean CA Post Construction Overview
The City Council will receive a presentation regarding the Downtown Streetscape Pedestrian Enhancements.
11. PUBLIC COMMENT PERIOD (Not to exceed 15 Minutes)
The City Council values your input. Instructions are provided above (page 1) for communicating with the City Council. Individual speakers are limited to three minutes or as directed by the Mayor.
12. CONSENT CALENDAR
The following routine items are presented for City Council approval without discussion as a single agenda item in order to expedite the meeting. The Consent Calendar is approved by roll call vote with one motion. These items are discussed only on request of Councilmembers. Members of the public may speak on Consent Calendar items during the Public Comment Period.
SHOULD A COUNCILMEMBER WISH TO DISCUSS OR DISAPPROVE ANY ITEM, it must be dropped from the blanket motion of approval and considered as a separate item.
RECOMMENDATION:
Adopt the Consent Calendar as submitted.
12.a CITY MANAGER/CITY CLERK DEPARTMENT
12.a.1 Ordinances and Resolutions
RECOMMENDATION:
Waive the reading in full of all Ordinances and Resolutions. Ordinances on the Consent Agenda will be adopted by the same vote cast at the first meeting, unless City Council indicates otherwise.
12.a.2 Approval of Minutes
RECOMMENDATION:
Approve the Minutes of the regular City Council meeting of July 16, 2024, and special City Council meeting of August 1, 2024.
12.a.3 Responses to 2023-2024 Santa Barbara County Grand Jury Report – Individuals in Crisis
The City Council will review staff’s recommended responses to the 2023-2024 Santa Barbara County Grand Jury report titled “Individuals in Crisis | The Right Care at the Right Time”
RECOMMENDATION:
Review and approve staff’s recommended responses addressing the finding and recommendation from the Grand Jury report titled “Individuals in Crisis” and authorize the Mayor to sign and transmit the City’s Response to the Presiding Judge of the Superior Court with a copy to the current impaneled Civil Grand Jury and file a copy with the City Clerk’s Office.
12.a.4 Adoption of a Resolution Cancelling the September 3, 2024, City Council Meeting
The City Council will consider canceling the regular City Council meeting on September 3, 2024, due to the Labor Day Holiday and a lack of agenda items.
Environmental Notice: The activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
RECOMMENDATION:
Adopt a Resolution canceling the regular City Council meeting on September 3, 2024.
12.b FINANCE DEPARTMENT
12.b.1 Payment of Warrants
RECOMMENDATION:
Order ratified subject to having been certified as being in conformity with the budget and having been approved for payment by the Director of Finance.
12.b.2 Payment of Payroll
RECOMMENDATION:
Order ratified subject to having been certified by the proper Department Directors, as shown on records on file in the Department of Finance, and having been approved for payment by the Director of Finance.
12.c PUBLIC WORKS DEPARTMENT
12.c.1 Adoption of a Resolution Approving the Proposed Establishment of Limited Time Parking Zone on Airpark Drive
The City Council will consider approving the establishment of a limited-time parking zone on Airpark Drive.
Environmental Notice: The activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
RECOMMENDATION:
Adopt a Resolution establishing a limited-time parking zone on Airpark Drive.
12.d UTILITIES DEPARTMENT
12.d.1 Adoption of a Resolution Designating an Authorized Representative for a Financial Agreement with the State Water Resources Control Board for the Ray Water Company Consolidation
The City Council will consider adopting a Resolution designating the Director of Utilities as the authorized representative for a financial agreement with the State Water Resources Control Board for the Ray Water Company Consolidation.
Environmental Notice: The City Council approved a mitigated negative declaration and mitigation monitoring program for the proposed project on October 4, 2022. No further environmental review required.
RECOMMENDATION:
Adopt a Resolution designating an Authorized Representative for a Financial Agreement with the State Water Resources Control Board for the Ray Water Company Consolidation.
13. APPOINTMENTS
13.a Annual Boards & Various Appointments – August 2024 The City Council will consider making appointments to Block Grants Advisory Committee, Library Board of Trustees, and Recreation and Parks Commission.
Environmental Notice: The activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
RECOMMENDATION:
Block Grants Advisory Committee
Current terms ended July 2024. Each Councilmember will have the opportunity to make one nomination each for a new term of three years ending July 2027.
Councilmember Soto has one nomination for an unexpired term ending July 2025.
Incumbents: Nomination to be made by:
Vacant Councilmember Aguilera-Hernandez
Vacant Councilmember Escobedo
Vacant Councilmember Cordero
Vacant (Solorio, Patricia – re-applied) Councilmember Soto Vacant (unexpired term ending July 2025) Councilmember Soto New Application:
Carla Marrel
RECOMMENDATION:
Library Board of Trustees
Current terms ended July 2024. The Mayor will have the opportunity to make one appointment for a new term of three years ending July 2027.
Incumbent: Previously nominated by:
Vacant (Jameson, Hunter – re-applied) Mayor Patino
RECOMMENDATION:
Recreation and Parks Commission
Councilmember Escobedo will have the opportunity to make one nomination for an unexpired term ending January 2025.
Incumbent: Nomination to be made by:
Vacant (unexpired term ending January
2025) Councilmember Escobedo
New Applicant(s):
Berumen, Isaac
Gudino, Cynthia
Lougee, Steve
14. PUBLIC HEARING
ORDER OF PROCEEDINGS FOR PUBLIC HEARING ITEMS:
Council Agenda Report to be given.
Applicant/Appellant comments.
Questions from the City Council.
Written communications/Public input.
Public hearing to be closed.
City Council discussion and action.
14.a Adoption of a Resolution Approving Fiscal Year 2025-2026 Community Development Block Grant Funding Priorities
The City Council will conduct a public hearing to receive comments on the priorities for Fiscal Year 2025-2026 funding.
Environmental Notice: This activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
RECOMMENDATION:
Adopt a Resolution approving the Community Development Block Grant funding priorities for the 2025-2026 Fiscal Year Funding Process.
15. REGULAR BUSINESS
ORDER OF PROCEEDINGS FOR REGULAR BUSINESS ITEMS:
Council Agenda Report to be given.
Questions from the City Council.
Written communications/Public input.
City Council discussion and action.
15.a Review of the Financial Report for the Fourth Quarter Ending June 30, 2024 The City Council will review and consider receiving the 2023-24 Fourth Quarter Financial Report.
Environmental Notice: The activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
The City Council will review and consider receiving the 2023-24 Fourth Quarter Financial Report.
RECOMMENDATION:
Receive and file the Financial Report for the Fourth Quarter Ending June 30, 2024.
15.b Stormwater Basin Policy
The City Council will receive information on stormwater basins and provide direction on a policy regulating the ownership and maintenance of stormwater basins.
RECOMMENDATION:
Receive a presentation on stormwater basins and provide direction to staff to implement a policy not to accept ownership and maintenance of any stormwater basins, with exception on a case-by-case basis, provided the basin serves an agreed upon public benefit with an identified funding source.
15.c Adoption of a Resolution Approving a Sales and Disposition Agreement Between the City of Santa Maria and Vernon Property Group, LLC for City Surplus Land in Downtown
The City Council will consider adopting a Resolution approving the Sales and Disposition Agreement between the City of Santa Maria and Vernon Property Group, LLC, which includes the sale of surplus land on various parcels in Downtown.
RECOMMENDATION:
Adopt a Resolution approving a Sales and Disposition Agreement between the City of Santa Maria and Vernon Property Group, LLC for various surplus land in Downtown, including parcels identified as Lots 1 through 4.
16. REPORT BY INTERIM CITY MANAGER
17. ORAL REPORTS OF COUNCILMEMBERS AND OFFICERS (INCLUDING AB1234
REPORTS)
18. ADJOURNMENT
PLEASE NOTE:
The next regular meeting of the City Council will be held on September 17, 2024, at 5:30 p.m. The deadline for submitting items for the September 17 meeting is September 4, 2024.
City Council Meetings are televised live on Comcast cable television channel 23 and are rebroadcast at 9:00 a.m. on the next Thursday and on the following Tuesday at 5:30 p.m.
Council Meeting videos are also available for viewing on the City’s website. Your attendance at this public meeting may result in the recording and broadcast of your image and/or voice.
If you challenge a determination made on a matter on this agenda in court, you may be limited to raising only those issues you or someone else raised at the public hearing described on this agenda, or in written correspondence to the city council at, or prior to, the public hearing.
CITY COUNCIL MEETING INFORMATION AND PROCESS:
This agenda is prepared and posted pursuant to Government Code Section 54954.2. By listing a topic on this agenda, the City Council has expressed its intent to discuss and act on each item. In addition to any action identified in the summary description of each item, the action that may be taken by the City Council shall include: a referral to staff with specific requests for information; continuance; specific direction to staff concerning the policy or mission of the item; discontinuance of consideration; authorization to enter into negotiations and execute agreements pertaining to the item; adoption or approval; and disapproval. Items not on the agenda may not be discussed or acted upon except under emergency circumstances. (Government Code Section 54954.2).
Copies of the staff reports or other documentation relating to each item of business referred to on the agenda are on file in the Office of the City Clerk and available for public inspection during City Hall business hours the Friday before the meeting. Any written correspondence or documents provided to a majority of the City Council after distribution of the Agenda will also be available for public inspection in the Office of the City Clerk. If requested, the agenda and supporting documents shall be made available in alternative formats to persons with a disability. The City Clerk’s Office will answer any questions regarding the agenda.
Materials related to an item on this agenda submitted after distribution of the agenda packet will also be available with the agenda material for public inspection during normal business hours in the City Clerk’s Office, 110 E. Cook Street, Santa Maria. Subject to the ability to post the documents prior to the meeting, such documents will also be available on the City’s meetings website portal for the current City Council meeting at https://cityofsantamaria.org/meetings.
The City of Santa Maria welcomes orderly participation at its meetings from all members of the public. Orderly participation means speaking only on items of City business or on subjects within the City’s control. Though the City Council wants to hear your concerns and
values your input, it is inappropriate to defame, yell, use profane language, interrupt, or disrupt the meeting. All cellular telephones are to be turned off or set to vibrate, and signs are not to be displayed in a manner that violates the rights of others or prevents others from watching or fully participating in the Council meeting. Pursuant to Government Code Section 36813, the Mayor is authorized to prohibit such conduct, up to and including ordering anyone that disrupts the meeting to be removed from the City Council Chambers.
To receive reasonable accommodation under the Americans with Disabilities Act during the meeting, please notify the City Clerk’s office of your needs during business hours at least 48 hours in advance of the meeting (typically before 3 p.m. on the Thursday before the meeting). The Office of the City Clerk is located at 110 East Cook Street in Santa Maria; telephone (805) 925-0951, extension 2306. The City will give primary consideration to your request in providing assistance. Examples of assistance may include exhibits in large-sized format, use of assisted listening equipment, use of the California Relay Service, texting by cellular phone, or the services of a live interpreter.
Assisted listening equipment can also be used for interpretation by Spanish-only speaking persons. To allow the City to coordinate and request a Spanish interpreter from the volunteer corps, contact the Office of the City Clerk by 1:00 p.m. on Monday before the meeting.
Equipo también puede ser utilizado para la asistencia de interpretación para esas personas que solamente hablan español. Para permitirle a la Ciudad que coordine y solicite un interprete de un grupo de voluntarios, llame al (805) 925-0951 extensión 2307 a la 1:00 de la tarde el lunes antes de la junta.
I, Donna G. Schwartz, hereby certify under penalty of perjury under the laws of the State of California that the foregoing agenda was posted not less than 72 hours at the following locations: City of Santa Maria City Hall and Library and made available at https://www.cityofsantamaria.org/services/departments/city-clerk-records/agendas-reports- meeting-videos on this 15th day of August 2024.
/s/ DONNA G. SCHWARTZ
Chief Deputy City Clerk
FOR THE COUNCIL MEETING OF AUGUST 20, 2024
COUNCIL AGENDA REPORT
TO: City Council
FROM: Interim City Manager Alex Posada
SUBJECT: Proclamation – “Women’s Equality Day” – August 26, 2024
The City Council will present a Proclamation recognizing August 26, 2024, as “Women’s Equality Day” in the City of Santa Maria.
BACKGROUND:
In 1971, at the initiative of Representative Bella Abzug (D -NY), and formally passed in 1973, the U.S. Congress designated August 26 as “Women’s Equality Day.” This date was chosen to honor the certification of the 19th Amendment to the Constitution in 1920, which granted women the right to vote. The amendment marked the successful culmination of a vast and peaceful civil rights movement that began formally in 1848 at the world’s first women’s rights convention in Seneca Falls, New York. Women’s Equality Day not only commemorates the passage of the 19th Amendment but also highlights the ongoing efforts toward achieving full gender equality. Today, workplaces , libraries, organizations, and public institutions observe this day with various programs, displays, video presentations, and other activities.
DISCUSSION:
Women in the United States have long strived to achieve full rights and privileges, both public and private, legal and institutional, as citizens. Across all states and within every cultural and religious group, women worked tirelessly to secure the right to vote. In recognition of this effort, Congress designated August 26, the date of the certificat ion of the Nineteenth Amendment, as Women’s Equality Day. Celebrating this day nationwide underscores the vital role of women’s contributions to democracy and encourages all citizens to reflect on the significance of the women’s suffrage movement and the ongoing pursuit of equal rights.
Proclamation Requested by: League of Women Voters Northern Santa Barbara County and the American Association of University Women.
Attachment: Proclamation
City of Santa Maria
Santa Maria, California
Proclamation
WHEREAS, women in the United States have continuously worked to gain full rights and privileges, public or private, legal or institutional as citizens of the United States; and
WHEREAS, women in every state and every cultural and religious group worked to secure women’s right to vote; and
WHEREAS, Congress has designated August 26, the date the Nineteenth Amendment was certified, as Women’s Equality Day; and
WHEREAS, recognizing Women’s Equality Day as a day of celebration throughout the country emphasizes the importance of women’s work for democracy; and
NOW, THEREFORE, I, ALICE M. PATINO, Mayor of the City of Santa Maria hereby recognize August 26, 2024, as:
“WOMEN’S EQUALITY DAY”
in the City of Santa Maria and encourage all residents to use this time to learn the importance of the women’s suffrage movement and the work to secure and expand equal rights.
IN WITNESS WHEREOF, I have hereunto set my hand and have caused the Seal of the City of Santa Maria to be affixed hereto this 20th day of August 2024.
______________________________
Alice M. Patino, Mayor
FOR THE COUNCIL MEETING OF AUGUST 20, 2024
COUNCIL AGENDA REPORT
TO: City Council
FROM: Interim City Manager Alex Posada
BY: Library Director Dawn Jackson
SUBJECT: Proclamation – “Library Card Sign-Up Month” - September 2024
The City Council will present a Proclamation to recognize September 2024 as “Library Card Sign-Up Month” in the City of Santa Maria.
BACKGROUND:
Library Card Sign-up Month was created in 1987 as a national campaign sponsored by the American Library Association (ALA) and libraries across the country to emphasize the importance of library cards to a child’s education and to reduce illiteracy. The cam paign started as a response to then Secretary of Education, William Bennett, who stated, “Let’s have a campaign…Every child should obtain a library card and use it.” With an $85,000 grant from the Reader’s Digest Foundation, the ALA teamed up with the Nati onal Commission on Libraries and Information Science to initiate Library Card Sign-up Month.
Since 1987, thousands of public libraries have participated in the annual campaign to remind parents, caregivers, and students that signing up for a library card i s a vital step on the path to academic achievement and lifelong learning.
Libraries play a crucial role in the education and development of children, offering a variety of programs to spark creativity and stimulate an interest in reading and learning.
Through access to technology, media resources, and educational programs, a library card gives students the tools to succeed in the classroom . It provides people of all ages opportunities to pursue their dreams, explore new passions and interests, and find their voice.
DISCUSSION:
The Santa Maria Public Library (Library) encourages community members to sign up for a free library card to access the Library’s many resources, print and electronic materials, databases, programming designed to meet community ne eds, and free services to support early literacy skills and lifelong learning. A library card provides community members with many cost-saving benefits, such as free access to the internet, Wi-Fi, and online databases, borrowing of up to 50 items at one ti me, free streaming service, and checking out items from the Library of Things collection. The Library is committed to offering a path to free resources that provide a respite from rising costs and enhance the quality of life for all community members.
2 Recognizing September as Library Card Sign -up Month in the City of Santa Maria will promote greater awareness of Library services and the value libraries provide to the community. By accessing these services with a Library card, residents will connect to resources and information which will positively impact their quality of life.
Proclamation Requested by: Santa Maria Public Library
Attachment: Proclamation
City of Santa Maria
Santa Maria, California
Proclamation
WHEREAS, Library Card Sign -up Month was created in 1987 as a national campaign sponsored by the American Library Association , the National Commission on Libraries and Information Science, and libraries across the country to emphasize the importance of library cards to a child’s education; and
WHEREAS, libraries play a crucial role in the education and development of children, offering a variety of programs to spark creativity and stimulate an interest in reading and learning; and
WHEREAS, libraries provide a learning environment that fosters joyful exploration and encourages residents to research subjects they are curious about; and
WHEREAS, library cards prov ide residents opportunities to connect to resources and information which will positively impact their quality of life; and
WHEREAS, a library card empowers all people to pursue their dreams, explore new passions and interests, and find their voice; and
WHEREAS, the Santa Maria Public Library encourages community members to take advantage of the Library’s many resources, print and electronic materials, databases, specially curated programming, and free services to support early literacy skills and continuing lifelong educational support.
NOW, THEREFORE, I, ALICE M. PATINO, Mayor of the City of Santa Maria, hereby proclaim September 2024 as:
“LIBRARY CARD SIGN-UP MONTH”
in the City of Santa Maria, and encourage all residents to sign-up for a free library card and connect with fellow community members at the Santa Maria Public Library or one of its branch libraries to promote greater awareness of Library services and the value libraries provide to the community.
IN WITNESS WHEREOF, I have here unto set my hand and have caused the Seal of the City of Santa Maria to be affixed hereto this 20th day of August 2024.
Alice M. Patino, Mayor
FOR THE COUNCIL MEETING OF AUGUST 20, 2024
COUNCIL AGENDA REPORT
TO: City Council
FROM: Interim City Manager Alex Posada
BY: Interim Director of Recreation and Parks Angela Oslund
SUBJECT: Santa Maria’s Hometown Heroes
The City Council will r eceive a presentation of the Summer 2024 Class of Honorees for the Hometown Heroes program, recognizing Santa Maria residents who are actively serving in the military, veterans of the United States military, first responders, or essential workers. This rec ognition will include the display of a celebratory banner featuring the honoree’s photograph and branch or classification of service.
BACKGROUND:
The Santa Maria Hometown Heroes Military Banner Program was established through a collaboration between the Santa Maria American Legion, the Veterans of Foreign Wars #2521, and the City of Santa Maria Recreation and Parks Department. Inspired by similar recognition programs across California, the City developed its unique Santa Maria Style Hometown Heroes initiative. Initially, the program honored active military personnel and veterans of the United States military. However, in response to the ongoing public health crisis caused by the Coronavirus (COVID-19), the program has been expanded to include the City’s first responders and essential workers who have worked tirelessly to save lives and ensure the safety of the community.
DISCUSSION:
In addition to having their banner displayed along South College Road in the Bradley Square area for six months starting in July 2024, each honoree or their family/sponsor will receive a City Council Certificate of Acknowledgment and Appreciation.
The deadline for nominations for the “Summer 2024 Class of Honorees” was June 28, 2024, and the recipients will be announced at the City Council meeting on August 20, 2024.
FOR THE COUNCIL MEETING OF AUGUST 20, 2024
COUNCIL AGENDA REPORT
TO: City Council
FROM: Interim City Manager Alex Posada
BY: Interim Recreation and Parks Director Angela Oslund
SUBJECT: Caltrans Clean CA Post Construction Overview
The City Council will r eceive a presentation regarding the Downtown Streetscape Pedestrian Enhancements.
BACKGROUND:
The Clean California Beautification Program was created to advance equity in underserved and disadvantaged communities by implementing transfor mative beautification projects along the State Highway System that improve safety and transform dividing highways into spaces that unify communities.
DISCUSSION:
The California State Legislature allocated special funding to enhance the aesthetics of public spaces through projects that reduce litter, improve public health and well -being, strengthen cultural connections, and promote community placemaking.
Twelve locations across five counties in Caltrans District 5 were selected based on criteria defining underserved and disadvantaged communities.
Clean California Beautification Projects followed an expedited project delivery process, resulting in record-time construction, job creation, and the advancement of local economic prosperity.
1 CITY COUNCIL MEETING MINUTES CITY OF SANTA MARIA, CALIFORNIA
July 16, 2024, 5:30 p.m.
City Hall Council Chambers
110 East Cook Street
Santa Maria
Roll Call: Mayor Alice Patino, Councilmember Maribel Aguilera-Hernandez, Councilmember Mike Cordero, Mayor Pro Tem Gloria Soto
Members Absent: Councilmember Carlos Escobedo
Staff Present: Interim City Manager Alex Posada, City Attorney Thomas Watson, Assistant City Manager Chuen Wu, Fire Chief Bradley Dandridge, Director of Public Works Brett Fulgoni, Interim Chief Human Resources Officer Dawn Jackson, Chief Information Officer Jeffrey Marecic, Interim Director of Recreation and Parks Angela Oslund, Interim Director of Community Development Dana Eady, Chief of Police Marc Schneider, Director of Utilities Shad Springer, Assistant City Clerk Alexandra Valadez, Deputy City Clerk Ashley Arciniega, Chief Deputy City Clerk Donna Schwartz
_____________________________________________________________________
CLOSED SESSION
1. CALL TO ORDER
Mayor Patino called the meeting to order at 4:30 p.m.
ROLL CALL:
MEMBERS PRESENT:
Councilmembers Maribel Aguilera -Hernandez (Arrived at 4:34 p.m.), Mike Cordero, Mayor Pro Tem Gloria Soto, and Mayor Alice Patino.
MEMBERS ABSENT:
Councilmember Carlos Escobedo.
STAFF MEMBERS PRESENT:
Interim City Manager Alex Posada and City Attorney Thomas Watson were present, along with Chief Deputy City Clerk Donna G. Schwartz, Assistant City Clerk Alexandra Valadez, and Deputy City Clerk Ashley Arciniega.
2. PUBLIC COMMENT PERIOD
Mayor Patino invited public comment. Speaking from the public was Matt Chircop.
3. RECESS-CLOSED SESSION
3.a Conference with Labor Negotiators, Pursuant to California Government Code §54957.6
3.b Public Employee Recruitment - City Manager, Pursuant to California Government Code §54956.8 Mayor Patino recessed to a Closed Session at 4:33 p.m.
4. RECONVENE TO OPEN SESSION
OPEN SESSION - 5:30 P .M.
5. INVOCATION
2 Neil Platon with First United Methodist Church gave the Invocation.
6. PLEDGE OF ALLEGIANCE
Councilmember Cordero led the Pledge of Allegiance.
7. CALL TO ORDER
Mayor Patino convened the meeting and called the meeting to order at 5:34 p.m.
Mayor Patino announced that item 14.b will be pulled from the agenda per staff's request.
8. REPORT BY THE CITY ATTORNEY FROM CLOSED SESSION
City Attorney Watson reported that instructions were provided to staff on items 3.a and 3.b
9. PROCLAMATIONS
9.a Proclamation – “National Night Out" – August 6, 2024 The City Council presented a Proclamation to recognize August 6, 2024, as “National Night Out”. The Proclamation was accepted by Sgt. Felix Diaz of the Santa Maria Police Department.
9.b Proclamation – “Recreation and Parks Month” – July 2024 The City Council presented a Proclamation recognizing July 2024 as “Recreation and Parks Month” in the City of Santa Maria. The Proclamation was accepted by the Recreation & Parks Commissioner Rebecca Carey.
9.c Businesses of the Quarter – July to September 2024
The City Council presented certificates to the featured Businesses of t he Quarter (July to September 2024) – JB’s Jewelers and Tony Cravello Insurance. The Proclamation was accepted by Jose and Brian Barrientos of JB's Jewelers and Anne Cravello of Tony Cravello Insurance.
10. PRESENTATIONS
10.a Master Plan for Aging and Livability Index
The City Council received a presentation on Santa Barbara County’s Master Plan for Aging and Livability Index. Presentation was made by Margaret Weiss, Project Coordinator for Santa Barbara County Master Plan for Aging.
One public comment was received by Midge Nicosia.
10.b Update on City Hall Landscape Project
The City Council received a presentation regarding project updates to the City Hall Landscape. The presentation was given by Interim Recreation & Parks Director A ngela Oslund and Interim Park Operations Manager Scott Christian.
11. PUBLIC COMMENT PERIOD (Not to exceed 15 Minutes)
Mayor Patino invited public comment. Speaking from the public was April Huckabey, James Bartlett, Andy Davis, Donna Pulling, Peggy Brierton, and Gary Hall.
Mayor Patino announced that item 14.a would be heard at this time.
12. CONSENT CALENDAR
Consent Calendar Items (except for item 12.c.2) were approved as presented, including the adoption of Resolution Nos. 2024 -93, 2024-94, 2024-95, 2024-96, 2024-97. The recorded vote appears with each item below.
Councilmember Soto requested to pull item 12.c.2 for a separate discussion and vote. It was adopted as Resolution No. 2024-98.
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Adopt the Consent Calendar as submitted.
3 For (4): Mayor Patino, Councilmember Aguilera-Hernandez, Councilmember Cordero, and Mayor Pro Tem Soto
Absent (1): Councilmember Escobedo
Motion carried by a recorded vote (4 to 0)
12.a CITY MANAGER/CITY CLERK DEPARTMENT
12.a.1 Ordinances and Resolutions
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Waived the reading in full of all Ordinances and Resolutions. Ordinances on the Consent Agenda will be adopted by the same vote cast at the first meeting, unless City Council indicates otherwise.
Motion carried by a recorded vote
12.a.2 Approval of Minutes
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Approved the Minutes of the regular City Council meeting of June 18, 2024, and the special City Council meeting of June 19, 2024.
Motion carried by a recorded vote
12.a.3 Adoption of a Resolution Authorizing the Revision of the Paying and Reporting Value of Employer Paid Member Contributions to the California Public Employees’ Retirement System for the Public Safety Managers
One public comment was received by Matt Chircop.
Action: Adopted as Resolution No. 2024-93
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Adopted a Resolution authorizing and approving the revised wage and benefits package for the Public Safety Managers regarding Employer Paid Member Contributions to the California Public Employees’ Retirement System.
Motion carried by a recorded vote
12.a.4 Adoption of a Resolution Requesting to Cancel the August 6, 2024, City Council Meeting Action: Adopted as Resolution No. 2024-94.
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Adopted a Resolution canceling the regular City Council meeting on August 6, 2024.
Motion carried by a recorded vote
12.b FINANCE DEPARTMENT
12.b.1 Payment of Warrants
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
4 Order ratified subject to having been certified as being in conformity with the budget and having been approved for payment by the Director of Finance.
Motion carried by a recorded vote
12.b.2 Payment of Payroll
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Order ratified subject to having been certified by the proper Department Directors, as shown on records on file in the Department of Finance, and having been approved for payment by the Director of Finance.
Motion carried by a recorded vote
12.b.3 Adoption of a Resolution Establishing the City of Santa Maria’s Fiscal Year 2024-25 Appropriation Limit
Action: Adopted as Resolution No. 2024-95.
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Adopted a Resolution establishing the City of Santa Ma ria’s Fiscal Year 2024 -25 appropriation limit.
Motion carried by a recorded vote
12.b.4 Adoption of a Resolution Approving a Professional Services Agreement for Continued Value Services with Collaborative Solutions LLC
Action: Adopted as Resolution No. 2024-96.
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Adopted a Resolution authorizing a ten -year Agreement with Collaborative Solutions, LLC, a Limited Liability Company, an affiliate of Cognizant Worldwide Limited, for Cont inued Value Services.
Motion carried by a recorded vote
12.c PUBLIC WORKS DEPARTMENT
12.c.1 Adoption of a Resolution Awarding Bid 2024-05 for Phase II of the North Dejoy Street Park Project
Action: Adopted as Resolution No. 2024-97.
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Adopted a Resolution awarding a bid to G. Sosa Construction, Inc., in the amount of $277,835, for the construction of the North DeJoy Street Park Project, Bid No. 2024-05.
Motion carried by a recorded vote
12.c.2 Adoption of a Resolution to Award a Professional Services Agreement for Active Transportation Plan Project Approval and Environmental Document Action: Adopted as Resolution No. 2024-98.
5 Moved by: Mayor Pro Tem Soto
Seconded by: Councilmember Aguilera-Hernandez
Adopted a Resolution awarding a Professional Services Agreement in the not -to-exceed amount of $489,270 to Nichols Consulting Engineers, Chtd. for Project Development Professional Services for Project Approval and Environm ental Document preparation associated with the Active Santa Maria Safe Routes to School project.
For (4): Mayor Patino, Councilmember Aguilera-Hernandez, Councilmember Cordero, and Mayor Pro Tem Soto
Absent (1): Councilmember Escobedo
Motion carried by a recorded vote (4 to 0)
12.a CITY MANAGER/CITY CLERK DEPARTMENT
12.a.1 Ordinances and Resolutions
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Waived the reading in full of all Ordinances and Resolutions. Ordinances on the Consent Agenda will be adopted by the same vote cast at the first meeting, unless City Council indicates otherwise.
Motion carried by a recorded vote
12.a.2 Approval of Minutes
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Approved the Minutes of the regular City Council meeting of June 18, 2024, and the special City Council meeting of June 19, 2024.
Motion carried by a recorded vote
12.a.3 Adoption of a Resolution Authorizing the Revision of the Paying and Reporting Value of Employer Paid Member Contributions to the California Public Employees’ Retirement System for the Public Safety Managers
One public comment was received by Matt Chircop.
Action: Adopted as Resolution No. 2024-93
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Adopted a Resolution authorizing and approving the revised wage and benefits package for the Public Safety Managers regarding Employer Paid Member Contributions to the California Public Employees’ Retirement System.
Motion carried by a recorded vote
12.a.4 Adoption of a Resolution Requesting to Cancel the August 6, 2024, City Council Meeting Action: Adopted as Resolution No. 2024-94.
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Adopted a Resolution canceling the regular City Council meeting on August 6, 2024.
6 Motion carried by a recorded vote
12.b FINANCE DEPARTMENT
12.b.1 Payment of Warrants
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Order ratified sub ject to having been certified as being in conformity with the budget and having been approved for payment by the Director of Finance.
Motion carried by a recorded vote
12.b.2 Payment of Payroll
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Order ratified subject to having been certified by the proper Department Directors, as shown on records on file in the Department of Finance, and having been approved for payment by the Director of Finance.
Motion carried by a recorded vote
12.b.3 Adoption of a Resolution Establishing the City of Santa Maria’s Fiscal Year 2024-25 Appropriation Limit
Action: Adopted as Resolution No. 2024-95.
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Adopted a Resolution establishing the City of Santa Maria’s Fiscal Year 2024 -25 appropriation limit.
Motion carried by a recorded vote
12.b.4 Adoption of a Resolution Approving a Professional Services Agreement for Continued Value Services with Collaborative Solutions LLC
Action: Adopted as Resolution No. 2024-96.
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Adopted a Resolution authorizing a ten -year Agreement with Collaborative Solutions, LLC, a Limited Liability Company, an affiliate of Cogn izant Worldwide Limited, for Continued Value Services.
Motion carried by a recorded vote
12.c PUBLIC WORKS DEPARTMENT
12.c.1 Adoption of a Resolution Awarding Bid 2024-05 for Phase II of the North Dejoy Street Park Project
Action: Adopted as Resolution No. 2024-97.
Moved by: Councilmember Cordero
Seconded by: Councilmember Aguilera-Hernandez
Adopted a Resolution awarding a bid to G. Sosa Construction, Inc., in the amount of $277,835, for the construction of the North DeJoy Street Park Project, Bid No. 2024-05.
7 Motion carried by a recorded vote
12.c.2 Adoption of a Resolution to Award a Professional Services Agreement for Active Transportation Plan Project Approval and Environmental Document Action: Adopted as Resolution No. 2024-98.
Moved by: Mayor Pro Tem Soto
Seconded by: Councilmember Aguilera-Hernandez
Adopted a Resolution awarding a Professional Services Agreement in the not -to-exceed amount of $489,270 to Nichols Consulting Engineers, Chtd. for Project Development Professional Services for Project Approval and Environmental Document preparation associated with the Active Santa Maria Safe Routes to School project.
For (4): Mayor Patino, Councilmember Aguilera-Hernandez, Councilmember Cordero, and Mayor Pro Tem Soto
Absent (1): Councilmember Escobedo
Motion carried by a recorded vote (4 to 0)
13. APPOINTMENTS
13.a Annual Boards & Various Appointments – July 2024
Assistant City Clerk Valadez announced that staff plans to revisit this item at the regular City Council meeting on August 20, 2024. This will provide Councilmember Escobedo the opportunity to make appointments and allow for the receipt of additional applications.
Moved by: Mayor Patino
Seconded by: Councilmember Cordero
Block Grants Advisory Committee
The Mayor and each Councilmember considered appointments for a new term of three years ending in July 2027. Mayor Pro Tem Soto also considered an additional vacancy for an unexpired term ending in July 2025.
One application was received from incumbent Robert Doyle (previously appointed by Mayor Patino).
One new application was received by Carla Marrel.
Councilmembers Aguilera-Hernandez, Cordero, and Mayor Pro Tem Soto did not make appointments.
Mayor Patino appointed incumbent Robert Doyle to serve a term of four years.
For (4): Mayor Patino, Councilmember Aguilera-Hernandez, Councilmember Cordero, and Mayor Pro Tem Soto
Absent (1): Councilmember Escobedo
Motion carried by a recorded vote (4 to 0)
Central Coast Commission for Seniors, Area Agency on Aging No applications were received.
Moved by: Mayor Patino
Seconded by: Councilmember Aguilera-Hernandez
Library Board of Trustees
The Mayor considered two appointments for a new term of three years ending in July 2027.
One application was received from incumbent Sara Lougee.
Mayor Patino appointed incumbent Sara Lougee to serve a term of three years.
8 For (4): Mayor Patino, Councilmember Aguilera-Hernandez, Councilmember Cordero, and Mayor Pro Tem Soto
Absent (1): Councilmember Escobedo
Motion carried by a recorded vote (4 to 0)
Moved by: Councilmember Aguilera-Hernandez
Seconded by: Councilmember Cordero
Measure U Citizens’ Oversight Committee
Councilmember Aguilera-Hernandez and Mayor Pro Tem Soto considered appointments for a term of four years ending in January 2027.
Two applications were received from John Childers, Jr. and Greggory Follett.
Councilmember Aguilera-Hernandez appointed John Childers, Jr. to serve a term of four years and/or coterminous with Councilmember Aguilera-Hernandez's term.
For (4): Mayor Patino, Councilmember Aguilera-Hernandez, Councilmember Cordero, and Mayor Pro Tem Soto
Absent (1): Councilmember Escobedo
Motion carried by a recorded vote (4 to 0)
Moved by: Mayor Pro Tem Soto
Seconded by: Councilmember Aguilera-Hernandez
Mayor Pro Tem Soto appointed Greggory Follett to serve a term of four years and/or coterminous with Mayor Pro Tem Soto's term.
For (4): Mayor Patino, Councilmember Aguilera-Hernandez, Councilmember Cordero, and Mayor Pro Tem Soto
Absent (1): Councilmember Escobedo
Motion carried by a recorded vote (4 to 0)
Recreation and Parks Commission
Due to Councilmember Escobedo's absence, this appointment was not considered.
One new application was received from Isaac Berumen.
SB County Library Advisory Committee
No applications were received.
14. REGULAR BUSINESS
14.a Status Update on Encampment Response Efforts
Mayor Patino moved this item directly following item 11.
Received and filed the status update on encampment response efforts and services. Staff report given by Assistant City Manager Chuen Wu.
14.b Adoption of a Resolution Approving a Sales and Disposition Agreement between the City of Santa Maria and Vernon Property Group, LLC for City Surplus Land in Downtown This item was pulled from the agenda. Mayor Patino invited public comment. Speaking from the public was Brad Vernon and Tony Cochiolo.
Action: Resolution not adopted.
9 Adopt a Resolution authorizing the City Manager to complete negotiations for the Sales and Disposition Agreement between the City of Santa Maria and Vernon Property Group, LLC, for various surplus land in Downtown, including parcels identified as Lots 1 through 4.
15. REPORT BY INTERIM CITY MANAGER
Interim City Manager Posada reported that the next City Council Meeting on August 6th was canceled.
The next City Council meeti ng will be on August 20th. Items on the agenda would include a Proclamation for Library Card Sign Up Month and Presentations on Hometown Heroes and CalTrans Grant Beautification of Broadway, Limited Time Parking on Airpark Drive, Continued Appointments, 4th Quarter Reports, Storm Water Basin Policy, a Placeholder for the Grand Jury Report Response, and an Appeal to a Traffic Committee Determination.
Interim City Manager Posada also reported that the City Council Meeting on September 3rd has also been canceled.
16. ORAL REPORTS OF COUNCILMEMBERS AND OFFICERS (INCLUDING AB1234 REPORTS) Councilmember Cordero reported that he attended the special session for the Council, Santa Maria Police Council Golf Tournament Fundraiser and Comedy Night, Santa Barbara County Action Network "Looking Forward" Awards Dinner, California Alliance of Local Elected, 3CE Board and Committee Meeting, and the Ribbon Cutting Ceremony at Merrill Gardens.
Councilmember Escobedo was not present.
Councilmember Aguilera-Hernandez reported that she attended the Graduation for Firefighters at Allan Hancock, 2024 Marian Residency Programs Graduation, the Ribbon Cutting Ceremony at Merrill Gardens, and the Recreation and Parks Red, White, and Zoom Celebration.
Councilmember Soto had no report.
Mayor Patino reported that she attended Police Department Badge Pinning & Promotions, Teen Outreach Coordinator Interviews, SBCAG Monthly Board Meeting, APCD Board Meeting, Your People Professionals 40th Anniversary, Santa Maria Police Council Golf Tou rnament Fundraiser, 2024 Marian Residency Programs Graduation, 2024 Life Walk, California Alliance of Local Elected, PAC Committee Meeting, Maria Regional Foundation Board Meeting, Pioneer Picnic Board Meeting, Ribbon Cutting Ceremony at Merrill Gardens, V irtual Partners in Education Board Meeting, Livable California Teleconference, Agriculture Awards & Kick -Off Dinner, and the Recreation and Parks Red, White, and Zoom Celebration.
17. ADJOURNMENT
There being no further business before the City Council, May or Patino declared the City Council meeting adjourned at 8:38 p.m.
_________________________
Chief Deputy City Clerk
_________________________
Alice M. Patino, Mayor
1 SPECIAL CITY COUNCIL MEETING MINUTES CITY OF SANTA MARIA, CALIFORNIA
August 1, 2024, 5:30 p.m.
City Hall Council Chambers
110 East Cook Street
Santa Maria
Roll Call: Mayor Alice Patino, Mayor Pro Tem Gloria Soto, Councilmember Maribel Aguilera-Hernandez, Councilmember Mike Cordero, Councilmember Carlos Escobedo
Staff Present: Interim City Manager Alex Posada, City Attorney Thomas Watson, Chief Deputy City Clerk Donna Schwartz, Assistant City Clerk Alexandra Valadez
_____________________________________________________________________
CLOSED SESSION
1. CALL TO ORDER
Mayor Patino called the meeting to order at 5:30 p.m.
ROLL CALL:
MEMBERS PRESENT:
Councilmembers Maribel Aguilera -Hernandez (arrived via teleconference at 5:32 p.m.), Mike Cordero, Carlos Escobedo, Gloria Soto (arrived at 5:35 p.m.), and Mayor Alice Patino
STAFF MEMBERS PRESENT:
Interim City Manager Posada, City Attorn ey Watson, and Chief Deputy City Clerk Schwartz (for roll call only).
Chief Deputy City Clerk Schwartz announced that a clerical error was made on the agenda that cited the Government Code §54956.8 incorrectly for item 3.a. The correct Government Code shou ld read 54957(b)(1).
2. PUBLIC COMMENT PERIOD
Mayor Patino invited public comment. No public comment was received.
3. RECESS-CLOSED SESSION
2 3.a Public Employee Recruitment - City Manager, Pursuant to California Government Code §54956.8
4. RECONVENE TO OPEN SESSION
Mayor Patino reconvened the meeting to open session at 7:34 p.m.
5. REPORT BY THE CITY ATTORNEY FROM CLOSED SESSION
City Attorney Watson reported that per California Government Code §54957(b)(1) discussions made in closed session. No report necessary.
6. ADJOURNMENT
There being no further business before the City Council, Mayor Patino declared the City Council meeting adjourned at 7:35 p.m.
_________________________
Chief Deputy City Clerk
_________________________
Alice M. Patino, Mayor
FOR THE COUNCIL MEETING OF AUGUST 20, 2024
COUNCIL AGENDA REPORT
TO: City Council
FROM: Interim City Manager Alex Posada
SUBJECT: Responses to 2023 -2024 Santa Barbara County Grand Jury Report – Individuals in Crisis
Description:
The City Council will review staff’s recommended responses to the 2023 -2024 Santa Barbara County Grand Jury report titled “Individuals in Crisis | The Right Care at the Right Time”
RECOMMENDATION:
Review and approve staff’s recommended responses addressing the finding and recommendation from the Grand Jury report titled “Individuals in Crisis” and authorize the Mayor to sign and transmit the City’s Response to the Presiding Judge of the Superior Court with a copy to the current impaneled Civil Grand Jury and file a copy with the City Clerk’s Office.
BACKGROUND:
On June 18, 2024, the City received the 2023 -2024 Santa Barbara County Grand Jury report titled Individuals in Crisis | The Right Care at the Right Time (Attachment A). The City Council is required to respond to this report within 90 days of receiving it, which provides the City Council until September 18, 2024, to reply to the Grand Jury.
DISCUSSION:
The 2023-2024 Santa Barbara County G rand Jury issued a report about Individuals in Crisis | The Right Care at the Right Time. This report focuses on improving responses to addressing the mental health crisis throughout the County.
The report provides a detailed overview of the California St ate Welfare and Institutions Code (WIC), Division 5, Mental Health Services, Article 1 commonly referred to as “5150 holds” and agency responses to a 5150 hold within Santa Barbara County.
The Grand Jury report identified a finding with one recommendation for various agencies, including the City of Santa Maria, connected with the full implementation of the 5150 hold by trained law enforcement.
Pursuant to California Penal Code Section 933 and 933.05, the Santa Barbara County Grand Jury requests each entit y to respond to the enumerated finding and recommendations within the specified statutory time limit. 2 Responses to Findings shall be either:
Agree
Disagree wholly
Disagree partially with an explanation
Furthermore, responses to recommendations shall be one of the following:
Has been implemented, with a summary of implementation actions taken Will be implemented, with an implementation schedule
Requires further analysis, with an analysis completion date of no more than six months after the publication of the report
Will not be implemented, with an explanation of why
A draft response letter to the Grand Jury is attached (Attachment B).
Alternative(s)
California Penal Code 933c states “ no later than 90 days after the grand jury su bmits a final report on the operations of any public agency subject to its reviewing authority, the governing body of the public agency shall comment to the presiding judge of the superior court on the findings and recommendations pertaining to matters under the control of the governing body” and further states “all of these comments and reports shall forthwith be submitted to the presiding judge of the superior court who impaneled the grand jury.” Reponses are prescribed per Penal Code 933.05.
Fiscal Considerations
There are no fiscal impacts on the response or implementation of the recommendations.
ATTACHMENTS
Attachment A: Individuals in Crisis | The Right Care at the Right Time Attachment B: Draft Response letter to the Grand Jury
INDIVIDUALS IN CRISIS
The Right Care at the Right Time
SUMMARY
The Santa Barbara Grand Jury established there have been attempts to improve the Co- Response Team effort with Behavioral Wellness, local police departments and the Sheriff’s Office when addressing mental health crises throughout the county. Law enforcement officers would benefit from enhanced training in assessing individuals with mental issues, especially in determining appropriate use of 5150 involuntary holds.
Furthermore, if the County would clarify the guidelines and remove the implied restrictions on peace officers, it would enable them to promptly and effectively use probable cause involuntary detention for individuals with mental disorders. As a result, these individuals would be better served, and the community would be safer.
BACKGROUND
The California State Welfare and Institutions Code (WIC), Division 5, Mental Health Services, Article 1 is commonly referred to as “5150 holds,” which is also known as the Lanterman-Petris-Short Act (LPS Act). Specifically, a 5150 describes criteria for detention of mentally disordered individuals, defined as “a danger to others, or to themselves, or gravely disabled.” This Code further specifies that “qualified peace officers or designated mental health experts can, upon probable cause, take, or cause to be taken, a person into custody for a period of up to 72-hours for evaluation and crisis intervention or be placed into a treatment facility.”
Despite having full legal authority to issue 5150 holds, Santa Barbara County (County) law enforcement has been constrained by an obscure historical limitation. This indirect or implied limitation originated in July of 1978 following passage of State Proposition 13, a property tax limitation initiative. Due to far reaching budgetary constraints, the 1 Attachment A
Santa Barbara County General Hospital was shuttered. This event prompted the County to request that Mental Health Services assess individuals with mental disorders, determine their status and, when necessary, issue a 5150 hold. Consolidating and streamlining services, lessening the burden on law enforcement, and controlling costs were the reasons behind this decision. Several years later the County contracted with a private mental health care provider (Baldridge) to assume a similar role. This arrangement continued for eight years. In 1989, the County began utilizing Mobile Life Support, a paramedic provider. Similar reasoning encouraged the County’s use of their service, which included cost containment, continued abandonment of these duties by law enforcement, preserving good relationships with the private hospitals, shorter processing times for the patient and family, and avoiding overuse of State Hospital beds if the Psychiatric Health Facility was full. In the early 2000s County Behavioral Wellness (BWell) took the lead role in dealing with the complex issues surrounding mental health related requests. This timeline demonstrates that over the past 46 years there has been an inferred but unwritten agreement between County, law enforcement, and various mental health agencies to allow the current mental health agency (BWell) to assume sole responsibility and authority to issue 5150 involuntary holds.
Santa Barbara is the only California County with this somewhat vague, enduring and poorly directed limitation placed on law enforcement.
METHODOLOGY
The 2023-2024 Santa Barbara County Grand Jury (Jury) conducted ten interviews including:
⦁ Sheriff Office staff
⦁ Santa Barbara law enforcement
⦁ Lompoc law enforcement
2 ⦁ Santa Maria law enforcement
⦁ Public Defender Office staff
⦁ Behavior Wellness staff
⦁ Board of Supervisors staff
⦁ County Executive Office staff
OBSERVATIONS
BWell and their mobile crisis teams are designated and empowered to issue the 5150 holds in Santa Barbara County. In most instances BWell endeavors to rapidly respond, de-escalate and stabilize individuals with mental disorders that pose serious risks. Their intervention often reduces the danger to the person and the community, avoids unnecessary emergency department care and lessens or circumvents law enforcement involvement. In many responses, the individual of concern is stabilized on site, sometimes agreeing to a voluntary admission into a mental health facility, and therefore no involuntary hold is required.
BWell is currently faced with a shortage of qualified personnel to staff the Co-Response Teams, which often leads to delays in attending each mental health related request 24/7/365. Weekends and nights are of particular concern especially when absences occur due to staff vacations and sick leaves.
As of January of 2024, BWell no longer relies exclusively on a phone assessment in requests for their services. Staff must respond in person within 60 minutes. The usual response time is now 20 – 40 minutes.
There are eight cities within Santa Barbara County. Only Santa Barbara, Santa Maria, 3 and Lompoc have independent police departments; the others contract with the Santa Barbara County Sheriff’s Office for law enforcement.
The Co-Response Team model includes a qualified BWell clinician responding with law enforcement when dispatched to a suspected or clearly defined mental health crisis. In times of urgency, if a clinician is not available, peace officers should be empowered to issue a 5150. Law enforcement officers are often the first on the scene for most, if not all, crisis concerns reported to 911. Data suggests that 7-10% of law enforcement calls are in response to individuals displaying moderate to severe mental illness symptoms.
The LPS Act (5150) allows for a law enforcement officer to respond to an undetermined 911 call to determine whether to issue a 5150 involuntary hold. All California police academies have a 40-hour course in Crisis Intervention Training (CIT) included in their basic Police Officer Standards and Training curriculum. The County currently has a clinician instructing line level law enforcement officers in CIT and the proper procedures for 5150 issuances. This is in direct response to the need for some veteran officers to receive supplemental training to ensure competency when responding to suspects in mental health crises.
A critical concern in the discussion of which agency or department is authorized to issue 5150s focuses on the number of available beds in the Psychiatric Heath Facility (PHF, often referred to as the “Puff”) run by BWell. Under federal and state medical guidelines, to be eligible for Medi-Cal and Medicare reimbursements, the County is permitted one PHF with a 16-bed maximum. There are preliminary plans, based on updated State allowances, for the PHF to be expanded to 19 beds by 2026. It has been estimated that for Santa Barbara County’s population the number of beds should be nearer to 40, and even that is considered a low estimate. This 16-bed limitation often begs the following question: Who is the gatekeeper for patients that require the services provided in the 72- hour hold in the PHF? The answer to this question is subject to some dispute.
Community based mental health advocates and social watchdog groups state that simply claiming a lack of available beds does not properly address the urgent needs of those in their time of crisis. Mentally distraught patients, of danger to themselves or others, are 4 entitled to the same medical services as for any other emergency. When the PHF is at capacity, new patients that require an involuntary detention can be sent to an out of county psychiatric facility.
The Jury was informed that in May of 2024, a Crisis Stabilization Unit (CSU) was slated to open in Santa Barbara with 8 locked beds admitting patients for detentions of up to 24- hours. The experience at the Marian Medical Center’s CSU in Santa Maria, opened in 2022, has demonstrated that 70% of the admitted patients stabilize within the 24-hour timeframe. By receiving de-escalation, social services, and medications, patients are often released to family members, caregivers, or into the general population. An added benefit is that the CSU diverts these patients from entering the emergency department, which can be overburdened, sometimes chaotic, and therefore not an altogether safe environment for someone with serious mental issues.
Santa Barbara Cottage Hospital has a locked psychiatric ward. The Emergency Department Physician can place an individual on a California Health and Safety Code 1799.111 hold to detain the person for 24 hours until a designated professional is able to evaluate the patient for a 5150 hold. All patients presented to the Emergency Department (ED) for psychiatric assessment will be registered as an ED patient and seen per ED protocol. Because Cottage is not a LPS Act designated facility, efforts to secure placement for each patient placed on a 5150 status will begin immediately upon admission.
In the fiscal year 2022-2023 there were 425 involuntary 5150 holds written by BWell in Santa Barbara County.
In February of 2023 a three-month pilot project was approved by the Board of Supervisors to allow trained law enforcement officers to issue 5150 holds. The intent has never been to issue more 5150 mental health detentions, but rather to have peace officers fully trained to evaluate, stabilize or refer mentally ill persons to the CSU, PHF, emergency department or available alternative and social services. This would help guarantee protection of individual civil rights and assist in providing the right treatment at the right time to those in need. The County Sheriff deputies along with the Santa Barbara 5 and Santa Maria City police officers participated in this training and were authorized to make 5150 determinations. It was stated to the Jury that the Sheriff’s Office has issued only two 5150 referrals through February of 2024.
CONCLUSION
Previously unspoken barriers are slowly being recognized and lessened, thereby advancing the methodical process of training and empowering County and City law enforcement to issue 5150 involuntary detentions.
Full implementation of the LPS Act-5150 hold, with complete cooperation of the Santa Barbara County Sheriff, independent City Police Departments, and Behavioral Wellness will hopefully prevent negative outcomes of persons acting in an irrational manner, threatening harm to themselves or others.
FINDINGS AND RECOMMENDATIONS
Finding 1:The Jury finds that full implementation of the 5150 holds by trained law enforcement officers would be beneficial to all citizens of Santa Barbara County.
Recommendation 1:The Jury recommends that all County and City law enforcement agencies be fully trained in crisis intervention, thus enabling their timely issuance of 5150 holds when appropriate.
REQUEST FOR RESPONSE
Pursuant to California Penal Code Section 933 and 933.05. the Santa Barbara County Grand Jury requests each entity or individual named below respond to the enumerated findings and recommendations within the specified statutory limit:
6 Responses to Findings shall be either:
⦁ Agree
⦁ Disagree wholly
⦁ Disagree with partial explanation
Response to Recommendations shall be one of the following:
⦁ Has been implemented, with brief summary of implementation actions taken ⦁ Will be implemented, with implementation schedule
⦁ Requires further analysis, with analysis completion date of no more than six months after the issuance of the report
⦁ Will not be implemented, with an explanation of why
Santa Barbara County Board of Supervisors – 90 days
Finding 1
Recommendation 1
City of Santa Barbara – 90 days
Finding 1
Recommendation 1
City of Santa Maria – 90 days
Finding 1
Recommendation 1
City of Lompoc – 90 days
Finding 1
7 Recommendation 1
Santa Barbara County Sheriff’s Office – 60 days
Finding 1
Recommendation 1
8 110 EAST COOK STREET ● SANTA MARIA, CA 93454-5190 ● (805) 925-0951 ● FAX (805) 349-0657 ● www.cityofsantamaria.org
Attachment B
CITY OF SANTA MARIA
OFFICE OF THE MAYOR
AND CITY COUNCIL
Mayor, Ext. 2204
City Council, Ext. 2205
[email protected]
August 20, 2024
Presiding Judge Pauline Maxwell
1100 Anacapa Street
P.O. Box 21107
Santa Barbara, CA 93121-1107
SUBJECT: Responses to 2023-24 Grand Jury Report
Individuals In Crisis
Dated June 18, 2024
Dear Honorable Judge Maxwell:
The City of Santa Maria is pleased to provide the following requested responses to the above-referenced report for Finding 1 and Recommendations 1 within 90 days of the report issuance. Please note the following responses:
FINDING 1
The Jury finds that full implementation of the 5150 holds by trained law enforcement officers would be beneficial to all citizens of Santa Barbara County.
Response: Disagree partially with an explanation.
The Santa Maria Police Department partially disagrees with this finding. The Santa Maria Police Department ’s current practice utilizes the specialized skills of a mental health professional coupled with that of a CIT -trained law enforcement officer, ensuring improved outcomes for people experiencing a mental health crisis. We are open to continually evaluating our current process and believe our community can be better served in the future if we are able to increase the number of co-response teams serving the City of Santa Maria. Currently, the Santa Maria Police Department partners with Santa Barbara County Department of Behavioral Wellness with an established co- response team partnership. This team consists of a trained ment al health professional from Behavioral Wellness and a CIT-trained police officer. Their expertise is essential for accurately assessing and managing individuals experiencing a mental health crisis. The co-response team is co- located at the Santa Maria Police Department and responds to calls for service involving people experiencing a mental health crisis. When not responding to active calls for service the team follows up with people who had previously experienced a mental health crisis, ensuring appropriat e services and resources are provided. If the department’s co- response team is unavailable, a Mobile Crisis team member from Santa Barbara County responds to assess the situation. This approach ensures that individuals in crisis Attachment B receive the most appropriate and effective care available whether from a Mobile Crisis team member or the department’s co- response team.
Recommendation 1
The Jury recommends that all County and City law enforcement agencies be fully trained in crisis intervention, thus enabling their timely issuance of 5150 holds when appropriate..
Response: Will not be implemented with an explanation of why.
The Santa Maria Police Department must respectfully disagree with this recommendation and clarify that we do not plan to implement it. We believe the current practice of involving mental health professionals, who have extensive training and experience in dealing with mental health crises, is the best approach. Even with additional training for law enforcement officers, it would be extremely difficult for them to replace the specialized skills of a trained mental health professional who regularly provides ass essments and intervention plans to individuals in crisis. Additionally, training all City law enforcement officers in crisis intervention would require significant resources, including time and funding, which could be more effectively utilized by enhancing and expanding the existing Mobile Crisis units or co -response teams. We understand and appreciate the recommendation of the Grand Jury and will explore the possibility of training a small number of officers to attend the 40-hour CIT and 5150 hold training, which could provide for a broader range of coverage across the various patrols shifts to evaluate 5150 holds in the absence of a trained mental health professional.
ALICE M. PATINO
Mayor
FOR THE COUNCIL MEETING OF AUGUST 20, 2024
COUNCIL AGENDA REPORT
TO: City Council
FROM: Interim City Manager Alex Posada
SUBJECT: Adoption of a Resolution Cancelling the September 3 , 2024, City Council Meeting
Description:
The City Council will consider canceling the regular City Council meeting on September 3, 2024, due to the Labor Day Holiday and a lack of agenda items.
Environmental Notice: The activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
RECOMMENDATION:
Adopt a Resolution canceling the regular City Council meeting on September 3, 2024.
BACKGROUND:
Section 2-1.01 of the Santa Maria Municipal Code sets the time, day, and place for holding City Council meetings to discuss items of City business. The City Council has the authority to cancel meetings due to lack of a quorum or lack of business items.
DISCUSSION:
While many cities go “dark” for a meeting or two during the summer months or holiday season, the Santa Maria City Council has always met on the first and third Tuesday of each month with no pre-determined scheduled breaks.
Due to the Labor Day and a lack of agenda items scheduled for September 3, 2024, City Council Meeting staff recommends that the City Council cancel the first meeting in September, and address items that arise between now and then at the September 17, 2024, Council meeting.
Alternative(s)
The City Council can decide not to cancel the September 3, 2024, meeting and meet as regularly scheduled.
Fiscal Considerations
There is no foreseeable fiscal impact as a result of this agenda item.
2 Impact to the Community
While the public will not have the ability to bring concerns to the City Council on September 3, 2024, due to the cancellation of the meeting, Councilmembers and staff remain available by email or telephone to address residents’ concerns during the regular business days prior to September 2nd and thereafter.
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF SANTA MARIA, CALIFORNIA, CANCELLING THE
REGULAR CITY COUNCIL MEETING ON SEPTEMBER 3, 2024
WHEREAS, the City Council meets on a regular schedule twice a month , on the first and third Tuesdays; and
WHEREAS, the City Council has the authority to cancel meetings when necessary; and
WHEREAS, it has been determined that the Labor Day Holiday and a lack of agenda items call for the cancellation of the September 3, 2024, City Council meeting.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa Maria that the September 3, 2024, City Council meeting is cancelled.
PASSED AND ADOPTED at a regular meeting of the City Council of the City of Santa Maria, California, held this 20th day of August 2024.
Mayor
ATTEST:
Chief Deputy City Clerk
APPROVED AS TO FORM:
By:
City Attorney
APPROVED AS TO CONTENT:
By: -------------------------------
Department Director
By:
Interim City Manager
FOR THE COUNCIL MEETING OF AUGUST 20, 2024
COUNCIL AGENDA REPORT
TO: City Council
FROM: Interim City Manager Alex Posada
BY: Director of Public Works Brett Fulgoni
SUBJECT: Adoption of a Resolution Approving the Proposed Establishment of Limited Time Parking Zone on Airpark Drive
Description:
The City Council will consider approving the establishment of a limited-time parking zone on Airpark Drive.
Environmental Notice: The activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
RECOMMENDATION:
Adopt a Resolution establishing a limited-time parking zone on Airpark Drive.
BACKGROUND:
Staff received a request to implement a limited -time parking zone along Airpark Drive.
This request stems from public safety concerns associated with vehicles parking for an extended period of time. The proposed measure entails an overnig ht parking restriction, aimed at prompting vehicle owners to seek alternative overnight parking arrangements.
A letter was sent to all the fronting businesses notifying them of the upcoming parking changes. The businesses were afforded the opportunity to express their opposition to the change. No communication expressing opposition was received.
DISCUSSION:
Per City Council Resolution No. 2061 and CAM 63 -15, a Traffic Committee was formed to “be responsible for the review, approval or denial, and recommendations to City Council on all matters and requests relating to traffic circulation and safety within the public right-of-way.” The Traffic Committee has reviewed the request for the limited -time parking zone and recommends the establishment of the limited-time parking zone to address safety concerns for the adjacent businesses. The City Council has the authority to locate, establish, or eliminate limited-time parking zones within the City.
The limited-time parking zone recommended to be established is described as follows:
2 1. Airpark Drive, 7 days a week, from 10:00 PM to 6:00 AM, along the easterly curb face, beginning at the curb return of the easterly curb ramp of the intersection of Airpark Drive and Fairway Drive and continuing 1,800 linear feet south.
2. Airpark Drive, 7 days a week, from 10:00 PM to 6:00 AM, along the westerly curb face, beginning at the curb return of the westerly curb ramp of the intersection of Airpark Drive and Fairway Drive and continuing 1,800 linear feet south.
Alternative(s)
City Council may elect to deny or modify the proposed permitted parking restriction.
Fiscal Considerations
The proposed parking restriction will require the installation of approximately 16 street poles and signs. The Public Works Departmen t has estimated the cost of the poles and signs to cost approximately $4,500 in staff time and materials.
Impact to the Community
Approximately 240 parking spaces will be limited during overnight hours. This parking restriction may cause any illegal campi ng and large vehicle parking to occur in another area of the City.
ATTACHMENTS
A. Proposed Limited-Time Parking Zone to be Established on Airpark Drive
±
CITY OF SANTA MARIADEPARTMENT OF PUBLIC WORKS110 SOUTH PINE STREETSANTA MARIA, CA 93458AIRPARK DRIVEDRAWN BY:APPROVED BY:LUIS A. MAGALLONDAVID BEASDRAWING NO:SCALE:TC23-30NTSSHEET NO:DAVID BEASPROPOSED LIMITED TIME PARKING ZONE 10PM6AM
Attachment A
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA
MARIA, CALIFORNIA, ESTABLISHING A LIMITED-TIME PARKING
ZONE ON AIRPARK DRIVE
WHEREAS, it is in the best interest of the City of Santa Maria to establish limited- time parking zones at certain locations within the City; and
WHEREAS, the City of Santa Maria Traffic Committee has reviewed and is recommending the establishment of a limited-time parking zone at the location described below;
NOW, THEREFORE, IT IS HEREBY RESOLVED that pursuant to Section 7-5.14 of the Santa Maria Municipal Code, a limited-time parking zone shall be established on the following street, incorporated herein by reference, at the following locations by the City Council of the City of Santa Maria, California, as follows:
1. Airpark Drive, 7 days a week, from 10:00 PM to 6:00 AM, along the easterly curb face, beginning at the curb return of the easterly curb ramp of the intersection of Airpark Drive and Fairway Drive and continuing 1,800 linear feet south.
2. Airpark Drive, 7 days a week, from 10:00 PM to 6:00 AM, along the westerly curb face, beginning at the curb return of the westerly curb ramp of the intersection of Airpark Drive and Fairway Drive and continuing 1,800 linear feet south.
BE IT FURTHER RESOLVED by the City Council of the City of Santa Maria, California, as follows:
1. The foregoing shall constitute traffic regulations pursuant to ordinance.
2. All work is to be accomplished using the standards and methods approved by the Director of Public Works . This shall be in accordance with standard City specifications, and the provision s of this Resolution are to be carried out by erecting signs, painting marks and temporary markers and barricades required, and by such other indicators or devices as may be under provisions of the Vehicle Code of the State of California and regulations adopted pursuant thereto.
3. The Chief Deputy City Clerk is hereby authorized to make minor changes herein to address clerical errors, so long as substantial conformance of the intent of this document is maintained. In doing so, the Chief Deputy City Clerk sh all consult with the City Manager and City Attorney concerning any changes deemed necessary.
PASSED AND ADOPTED at a regular meeting of the City Council of the City of Santa Maria held this 20th day of August 2024.
ATTEST:
Chief Deputy City Clerk
Mayor
APPROVED AS TO FORM:
_______________________________
City Attorney
APPROVED AS TO CONTENT:
_______________________________
Department Director
_______________________________
Interim City Manager
FOR THE COUNCIL MEETING OF AUGUST 20, 2024
COUNCIL AGENDA REPORT
TO: City Council
FROM: Interim City Manager Alex Posada
BY: Director of Utilities Shad S. Springer
SUBJECT: Adoption of a Resolution Designating an Authorized Representative for a Financial Agreement with the State Water Resources Control Board for the Ray Water Company Consolidation
Description:
The City Council will consider adopting a Resolution designating the Director of Utilities as the authorized representative for a financial agreement with the State Water Resources Control Board for the Ray Water Company Consolidation.
Environmental Notice: The City Council approved a mitigated negative declaration and mitigation monitoring program for the proposed project on October 4, 2022. No further environmental review required.
RECOMMENDATION:
Adopt a Resolution designating an Authorized Representative for a Financial Agreement with the State Water Resources Control Board for the Ray Water Company Consolidation.
BACKGROUND:
Ray Water Company (RWC) is a small water company located just outside the city limits of the City of Santa Maria (City), in unincorporated Santa Barbara County, serving properties located south of Mahoney Road at the E Street alignment (Attachment A – Vicinity Map). The properties se rved by RWC are surrounded by City jurisdiction to the north, east, and south. RWC was issued a Santa Barbara County water system permit in 1976 but the water system existed prior to that.
RWC has been governed by various appointed residents of the water system, which have changed over time. Currently, ownership is equally distributed among ten residents.
There are a total of 13 service connections (11 residential, 2 commercial) serving a population of approximately 45 residents. RWC utilizes groundwater as its drinking water source. The capacity of this source is unknown, because RWC does not meter the well or regularly monitor depth to groundwater. In addition, the RWC system uses one steel water storage tank.
Over the years, RWC has had ongoing difficul ties meeting regulatory requirements, primarily due to aging and outdated infrastructure. RWC has received numerous notices of violation from Santa Barbara County dating back to 1980. The most relevant violation 2 includes repeated nitrate concentrations above the maximum contaminant levels (MCL), but also other violations such as coliform bacteria detections, failure to perform required analytical testing, failure to properly inform residents of MCL exceedances, and failure to resolve the nitrate issue. Sant a Barbara County issued RWC an enforcement action Compliance Order on March 6, 2020, due to ongoing nitrate concentrations above the MCL. The Compliance Order required RWC to inform all residents of the elevated nitrate concentrations, submit a progress re port, and submit a corrective action plan to resolve the nitrate issue.
Through a technical assistance grant with the State of California, Weber, Hayes & Associates assisted RWC by preparing an engineering report and assisting in a proposed project to res olve the violations of the Compliance Order. The proposed project is a consolidation of RWC with the City’s water system. In order to serve RWC and connect to the City’s water system, a City water main is proposed to extend approximately 3,400 feet along Betteravia Road, from the intersection of Betteravia Road and A Street to the intersection Mahoney Road and Rayville Lane. At the intersection of Mahoney Road and Rayville Lane, the water main transitions into an 8 -inch water distribution line. This distribution line will connect the City water main to each of the 15 proposed service connections on Rayville Lane. Once construction is complete, the current RWC customers will become City water customers.
At its meeting on October 4, 2022, the City Council adop ted a Mitigated Negative Declaration (MND) and Mitigation Monitoring Program for the proposed project. In addition, the City Council authorized an application to the Santa Barabara Local Agency Formation Commission (LAFCO) as the City’s p rovision of domestic water to properties outside the City boundary requires approval from LAFCO . LAFCO approved an Out -of- Agency Service Agreement at its April 6, 2023 meeting for the City to serve the properties of RWC.
DISCUSSION:
Weber, Hayes & Associates has nearly co mpleted the design of the proposed project, along with necessary easements for the proposed City waterline and service connections to each customer. Those plans have been reviewed by the City’s Public Works Department, Engineering Division for compliance w ith City standards. The next step for the project is submission of the design package and supporting documentation to the State Water Resources Control Board for consideration of funding.
While developing the project, it was discovered that RWC was never formally incorporated. As such, it is not possible for the State Water Resources Control Board to enter agreements with RWC for the construction of the proposed project. In addition, the funding provided will require commitments of the receiving agency for a set period. After consolidation with the City, RWC will no longer exist. Therefore, the State Water Resources Control Board has indicated that it is preferred to have the City submit a financial assistance application and enter the financial agreements for the project.
A requirement of the financial assistance application is a Resolution of the City to designate an authorized representative who may file a financial assistance application .
The authorized representative will also provide the assurances, ce rtifications, and 3 commitments required for the application, including executing a financial assistance agreement with the State Water Resources Control Board. In addition, the authorized representative is designated to represent the City in carrying out the City’s responsibilities under the financing agreement, including certifying disbursement requests on behalf of the City and compliance with applicable state and federal laws.
It is intended that all costs associated with the project will not be the responsibility of the City. The funding will come from the State Water Resources Control Board or any source other than the City. Therefore, the Resolution indicates that the execution of a financial assistance agreement with the State Water Resour ces Control Board is subject to negotiation and approval as to form by the City Attorney and the City Manager.
Should funding be available and the City agree to the terms of a financial assistance agreement, the City will be responsible for constructing the project, which would include the abandonment of the RWC facilities (steel tank and well). Upon completion, the water main, distribution line, and meters will become City -owned and current RWC customers will become City water customers.
Alternatives
1. The City Council may choose to designate someone other than the Director of Utilities as the authorized representative for application to the State Water Resources Control Board. Staff does not recommend this alternative as the Director of Utilities is most familiar with the project.
2. The City Council may choose not to authorize a City representative to submit the application to the State Water Resources Control Board. This will end the City’s involvement in construction of the project. Staff does not recommend this alternative as there is no other entity that can enter agreement with the State Water Resources Control Board and complete the project.
Fiscal Considerations
The costs for the project will be funded by sources other than the City. The requested action will allow the City to pursue funding from the State Water Resources Control Board for the project.
Impact to the Community
The extension of the City’s water system to serve the current customers of the Ray Water Company will allow those customers to receive water that meets the requirements of the Safe Drinking Water Act.
Other Agency Review
The State Water Resources Control Board has reviewed and approved the Resolution as to meeting the needs for submission of a financial assistance application.
ATTACHMENTS
Attachment A – Vicinity Map
Ray Water Company
Vicinity Map
Attachment A
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA MARIA,
CALIFORNIA DESIGNATING AN AUTHORIZED REPRESENTATIVE FOR
A FINANCIAL AGREEMENT WITH THE STATE WATER RESOURCES
CONTROL BOARD FOR THE RAY WATER COMPANY CONSOLIDATION
WHEREAS, Ray Water Company is a small water company located outside the city limits of the City of Santa Maria; and
WHEREAS, Ray Water Company has difficulties meeting regulatory requirements and is subject to a Santa Barbara County enforcement action compliance order dated March 6, 2020; and
WHEREAS, Ray Water Company, through a technical assistance grant from the State of California, has identified consolidation of the Ray Water Company int o the City of Santa Maria’s water system (the “consolidation project”) as the preferred alternative to address the compliance order; and
WHEREAS, the State Water Resour ces Control Board has determined it cannot enter agreements with Ray Water Company and requested the City of Santa Maria be the applicant for the consolidation project; and
WHEREAS, in order for the City of Santa Maria to pursue funding from the State Water Resources Control Board to fund the consolidation project, a Financial Assistance application must be filed; and
WHEREAS, a requirement of the financial assistance application is a Resolution designating an authorized representative to file a financial assistance application and provide the as surances, certification s, and commitments required for the application , including executing a financial ass istance agreement with the State Water Resources Control Board and any amendment or changes thereto; and
WHEREAS, the authorized representative is designated to represent the City of Santa Maria in carrying out the City’s responsibilities under the financing agreement, including certifying disbursement requests on behalf of the City and compliance with state and federal laws.
NOW, THEREFORE, IT IS HEREBY RESOLVED by the City Council of the City of Santa Maria, California, as follows:
1. The above recitals are true and correct and incorporated herein; and
2. The Director of Utilities or designee is hereby designated a s the City’s authorized representative for the Ray Water Company Consolidation; and
3. The Financial Assistance Application is subject to negotiation and approval as to form by the City Attorney and City Manager; and
2 4. The Chief Deputy City Clerk is hereby authorized to make minor changes herein to address clerical errors, s o long as substantial conformance with the intent of this document is maintained. In doing so, the Chief Deputy City Clerk shall consult with the City Manager and City Attorney concerning any changes deemed necessary.
PASSED AND ADOPTED at a regular meeti ng of the City Council of the City of Santa Maria, California, held this 20th day of August, 2024.
ATTEST:
Chief Deputy City Clerk
Mayor
APPROVED AS TO FORM:
_________________________
City Attorney
APPROVED AS TO CONTENT:
_________________________
Department Director
_________________________
Interim City Manager
FOR THE COUNCIL MEETING OF AUGUST 20, 2024
COUNCIL AGENDA REPORT
TO: City Council
FROM: Interim City Manager Alex Posada
BY: Chief Deputy City Clerk Donna G. Schwartz
SUBJECT: Annual Boards & Various Appointments – August 2024
Description:
The City Council will consider making appointments to Block Grants Advisory Committee, Library Board of Trustees, and Recreation and Parks Commission.
Environmental Notice: The activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
RECOMMENDATIONS:
Block Grants Advisory Committee
Current terms ended July 2024. Each Councilmember will have the opportunity to make one nomination each for a new term of three years ending July 2027. Councilmember Soto has one nomination for an unexpired term ending July 2025.
Incumbents: Nomination to be made by:
Vacant Councilmember Aguilera-Hernandez
Vacant Councilmember Escobedo
Vacant Councilmember Cordero
Vacant (Solorio, Patricia – re-applied) Councilmember Soto Vacant (unexpired term ending July 2025) Councilmember Soto
New Application:
Carla Marrel
Library Board of Trustees
Current term s ended July 2024. The Mayor will have the opportunity to make one appointment for a new term of three years ending July 2027.
Incumbent: Previously Nominated by:
Vacant (Jameson, Hunter - re-applied) Mayor Patino
Recreation and Parks Commission
2 Councilmember Escobedo will have the opportunity to make one nomination for a n unexpired term ending January 2025.
Incumbent: Nomination to be made by:
Vacant (unexpired term ending January 2025) Councilmember Escobedo
New Applicant(s):
Berumen, Isaac
Gudino, Cynthia
Lougee, Steve
Members of the Block Grants Advisory Committee, Library Board of Trustees, and Recreation and Parks Commission are required by the Political Reform Act (Govt. Code Section 81000-91014), and the City’s Conflict of Interest Code, to file Statements of Economic Interest, Form 700, disclosing personal assets and income within 30 days of appointment, annually thereafter, and upon leaving office. Board Members must also disqualify themselves from participating in decisions which may affect their personal economic interests. Statements of Economic Interests are public documents and may be inspected by any member of the public and copied if requested. The Fair Political Practices Commission (FPPC) is the State agency which interprets the law’s provisions.
Copies of the applications may be obtained from the City Clerk's Office upon request.
Vacancies continue to exist on Block Grants Advisory Committee and Measure U Citizens’ Oversigh t Committee. Staff will continue to advertise Board and Committee vacancies until sufficient applications have been received and remaining vacancies may be filled.
Alternative(s)
A Councilmember could decide to withhold their nomination to a Board, Commission, or Committee until such time as additional applications could be received or there is sufficient opportunity for the Councilmember to make contact with the existing applicant(s) to be considered for nomination.
Impact to the Community
Having members of the public serve on the City’s Advisory Bodies provides a positive impact to the community, enabling the City to obtain input from all segments of the community and ensures that the community receives information regarding the activities of the City’s Boards, Committees, and Commissions.
FOR THE COUNCIL MEETING OF AUGUST 20, 2024
COUNCIL AGENDA REPORT
TO: City Council
FROM: Interim City Manager Alex Posada
BY: Interim Community Development Director Dana Eady
SUBJECT: Adoption of a Resolution Approving Fiscal Year 2025-2026 Community Development Block Grant Funding Priorities
Description:
The City Council will conduct a public hearing to receive comments on the priorities for Fiscal Year 2025-2026 funding.
Environmental Notice: This activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
RECOMMENDATION:
Adopt a Resolution approving the Community Development Block Grant funding priorities for the 2025-2026 Fiscal Year Funding Process.
Approve the use of Fiscal Year 2025 -26 CDBG Capital funding for City -related public facility projects.
BACKGROUND:
On an annual basis, the Block Grants Advisory Committee (BGAC) reviews the priorities outlined in the City’s Five -Year Consolidated Plan and decides whether they should be modified based on community needs. The priorities are one of the tools used by the BGAC and the City Council in determining what activities and projects should receive funding to maximize the impact the City’s Community Development Block Grant (CDBG) funds will have on City residents. This is a required process under the U.S. Housing and Urban Development’s (HUD’s) adopted Citizen Participation Plan.
DISCUSSION:
As part of th e required CDBG funding process, staff conducted a Community Needs Workshop on Monday, July 22, 2024. The workshop is designed to obtain information from residents and non -profit agencies concerning the unmet needs in the community.
Participants spoke about the need for more affordable housing, rent control, additional assistance for those experiencing homelessness, childcare affordability, accessibility and training, as well as continued education and support for related t o sexual, mental, physical, and emotional abuse and/or trauma. The needs expressed are reflected in the 2 existing CDBG funding priorities; therefore, the BGAC recommends no changes be made to the current priorities.
These funding priorities are one of several tools used by the BGAC and the City Council to determine how the funding is distributed. The City also has discretion as to how the funding should be allocated based on other factors such as the immediate need of a project, the project’s timeliness , the administrative capacity of the agency applying for funding, the applicant’s capacity to financially sustain the project long after the funding is utilized, and long-term goals imposed by the City in its five-year CDBG Consolidated Plan.
The adoption of these funding priorities by the City Council will kick off the Notice of Funding Availability (NOFA) which is scheduled to be released on Thursday, August 22 , 2024. This will inform potential applicants that the application process for F iscal Year 2025-26 has begun. During this funding cycle, staff recommends that the application process only be offered to non-profits under public services. Due to pressing needs involving the City’s public facilities, staff is recommending that CDBG Capital funding be set aside for City -related projects that will benefit the entire community, primarily low to moderate income people and areas per CDBG regulations. This may include currently funded public facility projects and / or new projects that require immediate attention, as it is important that funding be expended in a timely manner . While the City has historically provided approximately half of its CDBG Capital funding to non -profits, it is at the City’s discretion to utilize the funding to meet the community’s needs as long as the projects meet HUD’s regulations.
Alternative(s)
The City Council can amend the priorities with the understanding that it differs from the BGAC’s recommendation, the City’s adopted five-year CDBG Consolidated Plan, and that the changes may not accurately reflect the overall expressed needs of the community.
Delaying the adoption of the funding priorities will also delay the CDBG funding process for FY 2025-26.
The City Council can also choose not to set aside all the CDBG Capital funding for City projects or set aside a portion solely for non-profit projects like the minor home repair program which has been supported annually by the City Council for many years. In doing so, the Capital funding for City-related projects may be impacted.
Fiscal Considerations
No fiscal impacts.
Impact to the Community
The proposed action will have a positive impact on the community by providing the BGAC and potential sub -recipients with a decisive outline of the priorities for the upcoming funding cycle.
ATTACHMENTS
Attachment A: Proposed FY 2025-26 Priorities
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA
MARIA, CALIFORNIA, APPROVING THE COMMUNITY
DEVELOPMENT BLOCK GRANT FUNDING PRIORITIES FOR THE
2025-2026 FISCAL YEAR FUNDING PROCESS
WHEREAS, the City of Santa Maria has been eligible for Federal funding on an annual basis since 1975 under the Community Development Block Grant (CDBG) Program; and
WHEREAS, the funds may be used at the discretion of the City if the City’s activities comply with Federal regulations and meet one of three national objectives; and
WHEREAS, the national objectives are: 1) primary benefit to low and moderate - income persons; 2) prevention or elimination of slums or blight; or 3) meet an urgent community-wide need, such as one caused by a major catastrophic event (i.e. flooding, earthquake, etc.); and
WHEREAS, the Block Grants Advisory Committee (BGAC) annually reviews the priorities from the previous fiscal year which were adopted and approved by the City Council; and
WHEREAS, based on community partici pation and the U.S. Department of Housing and Urban Development (HUD) recommendations, the BGAC recommends that the priorities stay the same for the 2025-2026 Fiscal Year, as they have been for the past year.
NOW, THEREFORE, IT IS HEREBY RESOLVED by the City Council of the City of Santa Maria, California, as follows:
1) Authorize and direct the BGAC to adopt the funding priorities for the upcoming 2025-2026 Fiscal Year; and
2) The City Manager, or designee, is hereby authorized to make minor changes to these adopted priorities, so long as substantial conformance of the intent of the document is maintained; and
3) Authorize and direct the Chief Deputy City Clerk to make minor changes herein to address clerical errors, so long as substantial conformance of the intent of this document is maintained. In doing so, the Chief Deputy City Clerk shall consult with the City Manager and City Attorney concerning any changes deemed necessary.
///
///
PASSED AND ADOPTED at a regular meeting of the City Council of the City of Santa Maria held this 20th day of August 2024.
ATTEST:
Chief Deputy City Clerk
Mayor
APPROVED AS TO FORM:
_______________________________
City Attorney
APPROVED AS TO CONTENT:
_______________________________
Interim Department Director
_______________________________
Interim City Manager
ATTACHMENT A
CITY OF SANTA MARIA
COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM
PROPOSED FUNDING PRIORITIES
FOR FISCAL YEAR 2025-2026
Approved by the Block Grants Advisory Committee (BGAC) on Monday, July 22, 2024
A. Prevent homelessness, address critical needs, and assist at-risk youth, elderly, and underserved populations
Assist low- to moderate-income people in need of food, shelter, clothing, health care and/or safety.
Prevent juvenile delinquency and divert at -risk youth from gang involvement, crime, substance abuse, family violence, school problems, and out-of-control behavior. Address the housing, health care , accessibility , and service needs of underserved populations such as, but not limited to the elderly and persons with mental, physical, emotional, and developmental disabilities and/or diseases.
B. Expand educational and development opportunities
Support and develop social services and facilities and provide opportunities for youth development that will provide positive experiences needed by youth to achieve success.
Encourage programs to improve academic performance and educational outcomes for those in preschool through grade 12.
Support and encourage programs to provide adult literacy training and encourage life- long learning.
C. Provide affordable housing
Develop and support programs and projects to increase the supply of affordable housing for low to moderate-income persons.
Maintain and upgrade existing low to moderate -income neighborhoods and preserve affordable housing stock.
Provide services that will assist low to moderate -income homeowners and renters to continue living in their homes safely.
D. Revitalize existing neighborhoods
Revitalize existing neighborhoods in low to moderate -income areas by increasing services such as supportive social services, and upgrading public infrastructures, such as street lighting, improved sidewalks, parks, and recreational public facilities.
Note: The priorities are not listed in order of importance but itemized for reference purposes only. Priorities A and B will only be considered for CDBG public services funding.
FOR THE COUNCIL MEETING OF AUGUST 20, 2024
COUNCIL AGENDA REPORT
TO: City Council
FROM: Interim City Manager Alex Posada
BY: Interim Finance Director Xenia Bradford
SUBJECT: Review of the Financial Report for the Fourth Quarter Ending June 30, 2024
The City Council will review and consider receiving the 2023-24 Fourth Quarter Financial Report.
Environmental Notice: The activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
RECOMMENDATION:
Receive and file the Financial Report for the Fourth Quarter Ending June 30, 2024.
BACKGROUND:
Four times each year, City staff completes a comprehensive analysis of City finances, including projected fund balances, revenues to date, departmental expenditures, encumbrances, and potential adjustments. This financial report summarizes the fourth quarter financial analysis.
DISCUSSION:
The Quarterly Financial Report Fourth Quarter Ending June 30, 2024 (Attachment A) provides an overview of the current economic outlook at the State and National levels; General Fund revenues, expenditures, projected fund balances; Measure U activity; and activity in the three Enterprise Funds. Though this information is not audited and does not contain all the usual year-end adjustments, accruals, or disclosures, the information does provide a general picture of the City’s activity and the developing financial trends.
IMPACT TO THE COMMUNITY:
The interim financial statement provides the community with an understanding of the financial activity of the City’s primary funds.
Attachment A - Quarterly Financial Report Fourth Quarter Ending June 30, 2024
Quarterly Financial Report: Fourth Quarter Ending June 30, 2024 1 QUARTERLY
FINANCIAL
REPORT
FOURTH QUARTER ENDING
JUNE 30, 2024
ATTACHMENT A
1 MAYOR
Alice Patino
MAYOR PRO TEM
Gloria Soto
COUNCIL
Carlos Escobedo
Maribel Aguilera-Hernandez
Mike Cordero
INTERIM CITY MANAGER
Alex Posada
REPORT PREPARED BY
Xenia Bradford
Interim Director of Finance
206 East Cook Street
Santa Maria, CA 93454
(805)925-0951 Ext. 2215
www.cityofsantamaria.org
QUARTERLY
FINANCIAL
REPORT
CITY OF SANTA MARIA, CA
V
TABLE OF CONTENTS
ECONOMIC INDICATORS ................................................... 1 GENERAL FUND ................................................................ 2 MEASURE U FUND ............................................................. 6 ENTERPRISE FUNDS ............................................................ 7
WATER/WASTEWATER FUND
SOLID WASTE FUNDS
PUBLIC TRANSIT FUNDS
FY 2024-26 BIENNIAL BUDGET .......................................... 8 FUND BALANCE ................................................................ 8
GENERAL FUND
MEASURE U FUND
Quarterly Financial Report: Four th Quarter Ending June 30, 2024
1 ECONOMIC INDICATORS
Economic growth in the first half of the year wa s solid, with the economy expanding a robust 2.8 annualized rate in the second quarter. In early A u g u s t c a m e e c o n o m i c n e w s t h a t p u t a c r a c k i n investor confidence. The Department of Labor reported that the economy created fewer jobs in July than expected and the unemployment rate rose to 4. 3 percent. Still, the jobless rate has improved in every month of 2024 except February and now July.
Inflation remains a problem – most recently 3.0 percent for June - so pessimism has been felt broadly.
Purchasing a home in many markets across the na tion remains challenging with home prices at a record high and mortgage rates still elevated. Th e booming job market in the aftermath of the pandemic has recently returned to normal and it is tougher to find a new job. The 10-year median is 243,000 jobs added each month. In July the economy added 114,000 jobs.
Nationally, the housing market saw the median sales prices reach $426,900 in June, up 4.1 percent from last year. Higher mortgage rates contributed to a slowdown in sales for June, which were down
5.4 percent from a year ago. Rates are close to 6.5 percent. The pace of existing home sales jumped at the start of the year but remains far below typical levels.
In California, sales of existing homes dipped 0.8 percent in June, and the statewide median home price was $900,720, up 7.5 percent from a year ago, according to the California Association of Realtors. The group reported all major regions experienced an incr ease in their median price from a year ago in June. The Central Coast posted the biggest sales jump on a year-over-year basis, increasing 8.9 percent from a year ago. Redfin reported in June that Santa Maria home prices were up 4.1 percent, selling for a median price of $611,000. Zillow placed the median at $627,258 as of early August, up 8.6 percent from a year earlier.
California’s unemployment rate of 5.2 percent in June was unchanged from May – and remains the highest of any state. California’s job market expans ion officially entered its 50th month, according to the State Employment Development Department. Calif ornia gained 107,100 nonfarm payroll jobs in the first six months of 2024, which is more than do uble the number of nonfarm payroll jobs the State gained during the same time period last year (+38,400), Seven of California's 11 industry sectors gained jobs in June with the largest increase in Trade, Transportation, and Utilities (+9,800), adding jobs for the fourth consecutive month.
Due to California’s stubbornly high unemployment rate, Calmatters reported, the Employment Development Department expects the unemployment insurance fund to receive $4.8 billion in payroll taxes this year but to pay out $6.8 billion in benefits, meaning the fund’s deficit, including Federal loans, will reach $21.7 billion by the end of this year and $22 billion in 2025.
Santa Barbara County’s unemployment rate was 4.2 percent in June, and Santa Maria was at 5.0 percent.
California will make widespread cuts to state gove rnment operations, prisons, housing programs and health care workforce development in order to mainta in its social safety net as it moves to close a multibillion-dollar budget deficit. The $297.9 billio n budget relies on reserves and other means to address a remaining revenue gap estimated at $56 billion over the next two years.
Santa Barbara County adopted a $1. 59 billion budget, an increase of $100.3 million and 119 full-time equivalent positions from a year ago. A $6.6 million budget deficit in the General Fund is covered using reserves.
Quarterly Financial Report: Fourth Quarter Ending June 30, 2024
2 ECONOMIC INDICATORS (CONTINUED)
Since April 1st, when California’s minimum wage for fast food workers increased from $16 to $20 per hour, customers have seen prices climb. The objecti ve is to elevate the standard and ensure that workers are better equipped financially to meet their household expenses.
Gas prices are lower. The national average in early August was $3.48 per gallon, 30 cents less than one year ago. The average in California was $4.62, and it was $4.70 in Santa Barbara County.
The average rent in Santa Maria was $2,333 in earl y August according to Zillow.com. Insurers have been hiking premiums, and refusing to renew policies, to offset their rising costs due to extreme weather and the higher cost of new cars. The nationwide av erage annual cost of full-coverage car insurance hit $2,329 in June, up from $1,601 in January 2021, per Insurify, a digital insurance agent that helps users collect quotes from multiple insurers.
GENERAL FUND
GENERAL FUND
(in millions)
Adopted
Budget
Current
Budget
Year-End
Estimates
2023-24
Actual
Percent of
Current Budget
Revenues & Transfers In
Sales Tax $ 32,188 $ 32,188 $ 31,057 $ 31,825 98.9% Property Tax 25,696 25,696 25,696 26,724 104.0%
Hotel/Bed Tax 4,273 4,273 4,273 3,987 93.3%
Licenses, Permits & Fees 3,104 3,104 3,601 3,684 118.7% All Other Revenues 25,575 26,078 25,684 26,985 103.5% Total Revenues & Transfers In $ 90,836 $ 91,339 $ 90,311 $ 93,205 102.0%
Expenses & Transfers Out
Staffing $ 62,492 $ 62,761 $ 59,725 $ 59,863 95.4%
Contracts & Services 10,819 12,317 12,376 12,006 97.5% Materials & Supplies 4,306 5,041 4,925 4,827 95.7% Maintenance & Operations 9,210 9,226 9,222 9,173 99.4% Capital Outlay 5 1,095 1,015 1,051 96.0%
Debt Service 267 267 267 267 100.0%
Transfers 3,737 6,052 4,283 4,757 78.6%
Total Expenses & Transfers Out $ 90,836 $ 96,759 $ 91,813 $ 91,944 95.0%
Budget
The table above presents the budget as adopted , amended, and estimated along with unaudited actual expenditures as of June 30, 2024. General Fund appropriations adopted on June 20, 2023 were
KEY STATISTICS
Quarterly Financial Report: Four th Quarter Ending June 30, 2024
3 GENERAL FUND (CONTINUED)
$90.8 million compared to budgeted sources of $90.8 million, inclusive of a $2.02 million draw from the Local Economic Augmentation Fund (LEAF). The current fiscal year General Fund appropriations as of year-end are $96.8 million compared to budgeted sources of $91.3 million, which includes a $2.02 million draw from the Local Economic Augmentation Fund (LEAF). Year-end estimates for revenues and expenditures were developed using a range of sources, including historical revenue analysis economic data, input from the City’s sales and property tax consultant, City departments, and the County of Santa Barbara.
Year-Over-Year Comparison
The chart below compares revenue receipts, expenditures, and transfers for the fourth quarter ending June 30, 2024, versus the fourth quarter ending June 30, 2023.
Major Revenues
Through the fourth quarter, revenue receipts are at 102.0 percent of projections. Receipts from the four major General Fund revenue sources (Sales tax, Property tax, Hotel Tax, Licenses, Permits, & Fees), as
Quarterly Financial Report: Fourth Quarter Ending June 30, 2024
4 GENERAL FUND (CONTINUED)
shown above in the Revenues chart on the left, account for approximately 71 percent of total General Fund revenues. Revenues are more than the fourth quarter receipts from the prior year primarily due to property tax; however, the increase is offset by sales tax and hotel tax declines reflecting consumers’ concern about the economy. Additionally, community development fees for services show a decline compared to prior year. Property Tax is the only key revenue experiencing an increase over last year.
Revenue Variances
Here are the highlights of what is driving the vari ances in these individual revenue sources received through the fourth quarter.
Key variances include:
Property Tax: The bulk of these payments are received through Santa Barbara County in December, January, April, and May of each year. Property Tax received is 5.8 percent, or $1.5 million, more than last fiscal year.
Sales Tax: Receipts are 0.6 percent, or $180 thou sand, less than last year. With concerns about the economy still looming, consumers continue to reduce spending in the categories of general consumer goods in discount stores, home furn ishings, and electronics, as well as autos- transportation because of the challenges posed by elevated Auto prices, escalating financing expenses, and diminished access to credit.
Hotel/Bed Tax: Through June, Transient Occupancy Tax (TOT) receipts are 5.9 percent, or $250 thousand, less than last fiscal year and behind estimates by 6.7 percent, or $286 thousand. The year-over-year decline is reflective of broader travel options opening up post-pandemic. Licenses, Permits, & Fees: Revenue of $3.7 millio n exceeds projections by 18.7 percent, or $579 thousand, but is 10.9 percent, or $450 thousand, less than FY 2022-23. This year’s revenue includes the issuance of 2,349 building permits including permits for the Skyview Estates single family residential neighborhood which is planned for the construction of 58 new single-family homes on Santa Maria Way, 2 new duplexes, a new veterinary clinic located on Miller Street, Heritage Lofts Apartments in the Downtown area, and 384 Accessory Dwelling Units (ADUs). This is a slight decline compared to FY 2022-23, which includ ed the issuance of 2,391 building permits; however, permit activity has continued to exc eed projections due to ADU permit applications and overall development activity in Santa Maria.
Expenditures
Through the fourth quarter, expenditures, includin g the balances at year-end pending carryover for encumbrances ($929 thousand) and capital projects ($409 thousand), are at 95.0 percent of total budget. Expenditures, as shown above in the Expenditure Categories chart on the right, are trending within budget.
Quarterly Financial Report: Four th Quarter Ending June 30, 2024
5 GENERAL FUND (CONTINUED)
Expenditure Variances
Financial Reporting policies require explanation of variances greater than five percent of major categories and departmental variances greater than 10 percent. Staffing: Under budget by 4.6 percent through the fourth quarter, due to vacancies mostly experienced in the Police Depart ment. Recruitments of lateral and entry positions continue to be the Department’s focus to fill 28 vacancies.
Transfers Out: Under budget by 21.4 percent due to less need for the General Fund to subsidize Library operations.
The chart below presents the percentage of expenditures by department:
Key variances include:
Fire: Under budget by 11.1 percent, or $1.3 m illion, due to vacancies and fewer mutual aid responses resulting in lower overtime costs, as well as timing of some capital purchases. A promotional recruitment to fill vacant Battalion Chief, Captain, and Engineer positions has been tentatively scheduled.
The City Council authorized, as part of the 2023-24 Budget, all General Fund revenues above expenditures be transferred equally to the Local Economic Augmen tation Fund (LEAF), General Capital Project Fund, and Reserve for Unfunded Pension Benefits. That calculation will be completed during the FY 2023-24 year- end process currently underway.
Quarterly Financial Report: Fourth Quarter Ending June 30, 2024
6 MEASURE U FUND
MEASURE U FUND
(in millions)
Adopted
Budget
Current
Budget
Year-End
Estimates
2023-24
Actual
Percent of
Current Budget
Revenue $ 26,886 $ 26,886 $ 25,881 $ 26,546 98.7%
Expenses
Community Development $ 963 $ 963 $ 963 885 91.9%
City Manager’s Office 189 189 189 162 85.7%
Finance 3 3 3 3 100.0%
Library 1,188 1,232 1,221 1,227 99.6%
Recreation & Parks 3,590 3,692 3,692 3,333 90.3%
Fire 17,889 21,449 19,405 19,536 91.1%
Police 12,268 13,090 13,099 12,237 93.5%
Total Expenses $ 36,090 $ 40,618 $ 38,572 $ 37,383 92.0%
The table above presents the budget as adopted , amended, and estimated along with unaudited actual expenditures as of June 30, 2024. Measure U Fund appropriations adopted on June 20, 2023 were $36.1 million compared to budgeted sources of $26.9 million. Current appropriations as of year- end are $40.6 million (including carry over) compared to budgeted sour ces of $26.9 million. Year-end estimates for revenues and expenditures were developed using a range of sources, including historical revenue analysis economic data, input from the Ci ty’s sales and property tax consultant, and City departments.
Revenues received through June are at 98.7 percent of budget, or $26.5 million. Expenditures, including the balances at year-end pending carryover for encumbrances ($129 thousand) and capital projects ($6.6 million), are at 92.0 percent of budget, or $3.2 million under budget due to reallocation of funds in FY 2024-26. Most of the capital projects carryov er ($6.4 million) is for the Fire Department and is primarily due to the timing of capital projects, including parking lot and building maintenance, the expansion of Fire Station 1, acquisition of radios, and the purchase of a ladder truck.
The budget in the City Manager’s Office is for the costs associated with maintaining the City’s mass notification system database and the Public, Education, and Government (PEG) Production Manager position, which was restored to full-time through adoption of the 2023-24 budget. The Finance budget is for the annual independent audit of Measure U financial activity.
Through June, Measure U expended 90 percent on Public
Safety, 5 percent on Youth Services, and 5 percent on
Quality of Life.
Quarterly Financial Report: Four th Quarter Ending June 30, 2024
7 ENTERPRISE FUNDS
The Statement of Revenues and Expenses through the fourth quarter ending June30, 2024, for the three enterprise funds, are shown in the table below.
ENTERPRISE FUNDS
(in millions)
Water /
Wastewater
Solid
Waste
Public
Transit
Revenues
Charges for Service $ 55,729 $ 34,464 $ 626
Interest Income 2,093 840 327
Other Revenue 4,455 461 18,458
Total Revenues $ 62,277 $ 35,765 $ 19,411
Expenses
Operating $ 18,752 $ 31,535 $ 7,778
Capital 5,080 3,470 11,306
State Water Payment 23,648 - -
Debt Service 3,623 - -
Total Expenses $ 51,103 $ 35,005 $ 19,084
Revenues/Expenses $ 11,174 $ 760 $ 327
Water/Wastewater Funds
Revenues exceeded expenditures by $11.2 million, which is $2.0 million less than last year. Revenues increased 6.0 percent, or $3.5 million, compared to the prior year due to higher revenues generated through sales of metered water.
Expenses are $5.5 million more than last year primarily due to an increase in debt service payments as well as payments to the Central Coast Water Authority.
Through the fourth quarter, Water and Wastewater operational expenses are under budget by 11.2 percent due to personnel savings from vacant positions and timing of maintenance and contractual agreements.
Solid Waste Funds
The Solid Waste Fund reports refuse collection and disposal activities. Through the fourth quarter, Solid Waste revenues ex ceeded expenditures by $760 thousand.
Operational costs are under budget by 9.6 percent, or $3.4 million. Budget of $10.8 million was carried forward to 2023-24 to complete several capital projects, including $6.1 million towards development of the In tegrated Waste Management Facility at Los Flores and $2.3 million for the landfill collection gas system expansion.
Public Transit Funds
The City operates the Santa Maria Regional Transit (SMRT) and Breeze Transit systems, which are funded by a combination of Federal grants, State transportation funds, and user fares. Fare revenue through the fourth quarter is approximately $626 thousand, which is about $19 thousand mo re than last year. This difference is attributed to an increase in ridership. The farebox ratio through June 30, 2024, is 8.1 percent based on fares received and operating expenses recorded to date.
Quarterly Financial Report: Fourth Quarter Ending June 30, 2024
8 FY 2024-26 BIENNIAL BUDGET
The final budget was presented with a public hearin g at the City Council meeting held on June 18, 2024. Public engagement occurred during the City Council’s meetings in May and June along with budget presentations and discussion s with department directors. Get the latest information on the public meetings related to the development of the FY 2024-26 biennial budget by visiting the City’s website at: https://www.cityofsantamaria.org/services/departments/city-clerk-records/agendas- reports-meeting-videos.
FUND BALANCE
General Fund
The table below shows revenues are at 102.0 percen t of projections while expenditures, including the balances at year-end pending carryover for encu mbrances ($929 thousand) and capital projects ($409 thousand), are at 94.1 percent of appropriat ions. The beginning fund balance is an estimate because the City’s annual audit for FY 2022-23 is not finalized.
GENERAL FUND
(in millions) Budget 4 th Quarter Percent
Beg. Fund Bal. $ 10,072 $ 10,072
Revenues* 91,339 93,204 102.0%
Expenditures* 96,759 91,004 94.1%
Rev/Exp $ (5,420) $ 2,200
Avail. Bal. $ 4,652 $ 12,272
*Includes Transfers
Measure U Fund
The table below shows revenues are at 98.7 percent of projections while expenditures, including the balances at year-end pending carryover for encumbrances ($129 thousand) and capital projects ($6.6 million), are at 75.7 percent of appropriations. The beginning fund balance is an estimate because the City’s annual audit for FY 2022-23 is not finalized.
MEASURE U FUND
(in millions) Budget 4 th Quarter Percent
Beg. Fund Bal. $ 17,060 $ 17,060
Revenues* 26,886 26,546 98.7%
Expenditures* 40,618 37,383 92.0%
Rev/Exp $ (13,732) $ (10,837)
Avail. Bal. $ 3,328 $ 6,223
*Includes Transfers
This Page Intentionally Left Blank
MAYOR & COUNCIL
Gloria Soto
Councilmember
District 3
Maribel
Aguilera-
Hernandez
Councilmember
District 4
Alice Patino
Mayor
At-Large
Carlos
Escobedo
Councilmember
District 1
Mike Cordero
Councilmember
District 2
City of Santa Maria, California
110 E. Cook Street
Santa Maria, CA 93454
cityofsantamaria.org
EXPLORE
the City’s budget online at
www.cityofsantamaria.org/services/departments/city-manager-s-office/city-budget
CITY OF SANTA MARIA DISTRICTS
DISTRICT 2
Mike Cordero
DISTRICT 1
Carlos Escobedo
DISTRICT 3
Gloria Soto
DISTRICT 4
Maribel Aguilera-Hernandez
FOR THE COUNCIL MEETING OF AUGUST 20, 2024
COUNCIL AGENDA REPORT
TO: City Council
FROM: Interim City Manager Alex Posada
BY: Assistant City Manager Chuen Wu
SUBJECT: Stormwater Basin Policy
Description:
The City Council will receive information on stormwater basins and provide direction on a policy regulating the ownership and maintenance of stormwater basins.
RECOMMENDATION:
The City Council will r eceive a presentation on stormwater basins and provide direction to staff to implement a policy not to accept ownership and maintenance of any stormwater basins, with exception on a case -by-case basis, provided the basin serves an agreed upon public benefit with an identified funding source.
BACKGROUND:
A stormwater basin is a conventional method for managing flood control. Basins are meant to collect stormwater and slowly release it at a controlled rate so downstream areas are not flooded or eroded. Basins a re often built as part of new development, as new impervious surfaces such as rooftops and pavement create additional stormwater runoff.
While effective for flood control, basins are now also considered for water quality treatment, and expanding regulation s governing water quality treatment are creating additional requirements for maintaining stormwater basins.
The federal Clean Water Act’s National Pollutant Discharge Elimination System (NPDES) Phase II regulations govern stormwater discharges from small municipalities that operate storm drain systems. The State Water Resources Control Board (Water Board), and the Regional Water Quality Control Boards (RWQCB), are responsible for the implementation of NPDES regulations for the City of Santa Maria. While the NPDES regulations are intended to prevent further impacts from stormwater runoff on stream systems, they also result in added maintenance, and correspondingly, added costs.
DISCUSSION:
Throughout Santa Maria, both historical basins for managin g floods , and newer Post Construction Required (PCR) basins , that are designed to reduce pollutant discharges , are found. Newer requirements have triggered discussions with the development community on the management of stormwater basins , in particular , basins built in 2 conjunction with single -family neighborhoods that have no management (such as a homeowner’s association.) By comparison, commercial and multi -family developments constructed with onsite basins are privately owned by a corporation and maintain ed through management. These developments may also incorporate other designs to address drainage and treatment of water runoff, such as underground basins, and bio - swales (bioswales are drainage channels with gently sloped sides built into landscaped areas).
The City would like to implement policies not to accept ownership and maintenance of any stormwater basins, due to increasing operations and maintenance costs from additional post-construction stormwater management requirements, as adopted by the RWQCB. The primary objective of these requirements is to ensure the reduction of pollutant discharges to the maximum extent practicable and prevent stormwater discharges from causing or contributing to a water quality violation.
Typical maintenance includes r emoving the accumulation of sediment, litter, or debris; clearing obstructed inlets and outlets; repairing or replacing damaged components; addressing poor, overgrown, or dead vegetation; and repairing and replanting eroded areas. A bioretention basin would also include engineered soil media to remove pollutants to meet water quality standards, yet the engineered media will become less effective over time, as the pollutants are absorbed into and saturate the media. Due to reporting requirements to the RWQCB, bioretention basins need to be monitored and maintained, including the regular testing of soil and media, and site restoration and erosion control.
The requirements to meet increasingly stringent water quality standards pose potential significant long-term costs, should the City assume ownership and maintenance of any additional stormwater basin. The tasks for addressing stormwater quality exceed and are distinguished from typical landscape maintenance. The additional costs are above and beyond typical landscape maintenance costs, and the City has not sufficiently collected the funds needed to cover these additional costs. Moreover, it is difficult to plan for future costs, considering ongoing and evolving water quality regulations.
Staff proposes the following policy for stormwater basins:
The City shall not accept ownership, nor accept maintenance of any stormwater basins required as a condition of approval for any development project.
An exception to this policy may be made on a case -by-case basis provided the basin serves a public benefit, such as a regional recreation space for use by the general public (i.e. sports field), whose design, configuration, size , and public access meets the requirements of the Recreation and Parks Department.
This exception may only be made provided the basin meets the following criteria:
1. The basin does not serve as a stormwater control measure requiring ongoing or perpetual maintenance as identified in a Stormwater Control Plan and is not 3 subject to the post -construction requirements of the Regional Water Quality Control Board (“RWQCB”).
2. The basin is not subject to any other permit from the RWQCB or other regulatory authority.
3. There is a funding mechanism in place to pay for maintenance and operation of the basin, such as being part of a Landscape Maintenance District, Special Benefit Zone, and/or other approved funding mechanism.
The City recognizes the existence of some “orphan basins,” or basins that have no assigned governing ownership. These include Parkside, located east of Preisker Lane and south of Portland Drive; San Ysidro, located south of McCoy Lane and east of Miller Street; and Montealegre, located east of Westgate Road and south of Via Rosa. Two other basins have been identified, but with an active co rporate status, including Bradley Square, located east of College Drive and south of McCoy Lane ; and Eastridge, located east of Panther Drive and south of Willingham Drive. Although these basins have been accepted into the City’s landscape district, and the City is maintaining these basins, staff recommends not including these parcels for ownership, due to added ongoing liability and costs.
In considering the future developments in the City of Santa Maria, staff expect and require basins to be privately o wned, managed, and maintained. Many new residential developments are small-lot residences with private community amenities, managed by a homeowner’s association, such as Blosser Ranch, a large development approved in 2023. Future residential developments are also expected to be built on larger parcels that would be master -planned, and long -term maintenance could be funded by other mechanisms such as a community facilities district (CFD). The CFD can be used to pay for ongoing services, or for other enhanced improvements.
Alternative(s)
The City Council can choose not to provide direction to adopt the recommended policy.
If so, the City may be responsible for ownership and maintenance of future stormwater basins and incur all associated costs, in perpetuity.
Fiscal Considerations
The recommended policy is in line with the City Council’s identified broad goal of long - term financial sustainability. Staff advises against owning and maintaining stormwater basins in future developments due to ongoing operation and maintenance costs, subject to increasingly stringent water quality requirements.
4 Impact to the Community
City staff will work closely with developers of future developments on the ownership and maintenance of stormwater basins. The establishment of a homeowner’s association or a CFD would be needed for a single-family development, to fulfill ongoing responsibilities of stormwater basin management. Staff encourages the development of high -quality projects with improvements that would meet all requirements and serve future residents with good community amenities that would be perpetually and effectively maintained over time.
FOR THE COUNCIL MEETING OF AUGUST 20, 2024
COUNCIL AGENDA REPORT
TO: City Council
FROM: Interim City Manager Alex Posada
BY: Assistant City Manager Chuen Wu
SUBJECT: Adoption of a Resolution Approving a Sales and Disposition Agreement Between the City of Santa Maria and Vernon Property Group, LLC for City Surplus Land in Downtown
Description:
The City Council will consider adopting a Resolution approving the Sales and Disposition Agreement between the City of Santa Maria and Vernon Property Group, LLC, which includes the sale of surplus land on various parcels in Downtown.
RECOMMENDATION:
Adopt a Resolution approving a Sales and Disposition Agreement between the City of Santa Maria and Vernon Property Group, LLC for various surplus land in Downtown, including parcels identified as Lots 1 through 4.
BACKGROUND:
The City Council has consistently identified the revitalization and redevelopment of Santa Maria’s downtown as a goal and priority. The City has adopted plans to establish a vision and to facilitate the redevelopment of downtown, including an update to the Downtown Specific Plan in 2015 and the adoption of the Downtown Streetscape Plan in 2019.
To further stimulate Downtown redevelopment, the City identified specific City -owned parcels for development, including the northerly parking lot adjacent to the former Fallas/Mervyn’s building and Broadway (Lot 1), the northeast and southeast corners of Main and Broadway (Lot 2 and 3, respectively), and the parking lot east of the Ruffoni building adjacent to Lincoln (Lot 4). The City and the Chamber of Commerce worked together to issue a Request for Proposals (RFP) in September 2020, and four proposals were received in response to the RFP. In January 2021, the City selected the Vernon Property Group, LLC (Vernon Group) based on their submitted project design and team qualifications.
The proposed project design included several hundred multi-family housing units, ground- floor commercial retail, and other public amenities, including plazas and open spaces (see Attachment A). This mix of housing, commercial, and gathering spaces, within proximity to each other, meets the vision of a vibrant and pedestrian -friendly downtown. 2 In the summer of 2021, the City completed initial State Surplus Lands Act requirements, including all required notifications and good-faith negotiations.
In 2022 and 2023, City staff and Vernon Group continued to work together toward a global sales and disposition agreement that includes all four identified City-owned lots. The City and Vernon Group also discussed Surplus Lands Act requirements with State Housing and Community Development (HCD), including the requirement of setting aside minimum 25 percent of all proposed housing units as income -restricted affordable housing. State HCD had initially communicated to the City that each City -owned lot would need a 25 percent housing set -aside, but after additional discussion, HCD agreed that the requirement for affordable housing could be achieved through consolidation by building one affordable housing development on Lot 2.
While Lot 2 will include affordable apartments, Lot 1 will include most of the community amenities of commercial uses, plazas and open spaces, thereby mitigating the displacement of open space at Perlman Park. During the past two years, Downtown Permits were approved for other projects in downtown, incl uding Heritage Walk Lofts (former Fallas/Mervyn’s), Alvin Newton Apartments (Lot 3), and Cook Street Apartments.
The construction plans for both Heritage Walk Lofts and Alvin Newton Apartments are currently in review by the City. Both projects could break ground later in 2024.
DISCUSSION:
On May 7, 2024, City staff provided an overview of the project design and drawings drafted for Lot 1 and Lot 2. As mentioned, Lot 3 includes the previously approved project of Alvin Newton Apartments. Lot 4 is considered as a future option after progress on Lots 1, 2, and 3.
The overall project design includes reduced parking compared to what is typically required in the City’s development standards. The Downtown Specific Plan allows for reduced parking if the project is located within proximity to the Ci ty’s existing parking garages located at Town Center. Staff also recognizes the necessary tradeoffs for achieving the stated downtown vision of a pedestrian -friendly city center. This tradeoff includes the addition of housing, commercial uses, and gathering spaces in exchange for land and spaces that would otherwise be used for creating parking spaces. The development proposal incorporates an approach that maximizes the value and potential of a limited infill land area. This pedestrian -friendly, urbanized environment simply could not be achieved if typical parking standards for apartments at two spaces per unit, were applied. However, future residents will have the privilege of having many amenities within a short walking distance, including access to public transit, offering a lifestyle that is an alternative to car dependency.
The proposed Sales and Disposition Agreement (SDA) includes four City-owned parcels.
The proposed agreement includes project descriptions, design expectations, affordability 3 components, and performance measures for completion. Detailed information for each lot is as follows:
Lot 1:
Lot 1 (APN 123 -280-026) is approximately two acres in size and is currently an underutilized parking lot for Town Center West, although it is used for the weekly farmer’s market. This lot will include most of the amenities proposed for the overall Downtown revitalization project, including ample plazas, open space, and a reconstruction of Heritage Walk, which serves as a paseo extending west from Br oadway. Ground floor commercial uses, including food establishments , will be integrated into these gathering areas, creating an inviting destination environment where visitors can enjoy a meal and gather. The SDA requires a minimum of 10,000 sq. ft. for co mmercial uses, with a minimum of 5,000 sq. ft. for dining and food establishments. As part of a 6 -story mixed- use structure, residential uses will be built over ground floor parking and commercial uses, up to 375 housing units, which may include microunits and condominiums. The ground floor commercial uses are located in a manner that will minimize the view of the podium parking spaces. On-site parking will meet the Downtown Specific Plan requirements.
Lot 2:
Lot 2 (APN 121-224-035) is approximately 1.12 acres in size and is currently the location for Perlman Park, just south of Union Plaza Apartments. A 6-story apartment building with up to 160 affordable housing units is proposed on this site (Attachment B). 75 parking spaces will be available on-site, with remaining parking spaces provided in nearby parking areas, including the parking structure on the south side of Main Street, which includes 1,078 spaces. There is recognition of a loss of park space; however, this loss is mitigated by the addition of p lazas and open space on the other lots, particularly Lot 1, with new plazas and paseos. The SDA will require that the housing remain affordable to lower - income households, with a minimum overall affordability of 60 percent of the area median income. The SDA will also require landscaped paths connecting the corner of Main and Broadway to Central Plaza Park, maintaining access for those areas north and east of the proposed apartments.
Lot 3:
Lot 3 (APN: 125-320-050) is approximately 0.62 acre in size and is currently a plaza area that includes the Firefighters’ and Four Corners’ memorials. The plaza area is north of Bank of America and west of the parking garage on the south side of Main Street. The City Council approved Alvin Newton Apartments at this locat ion in October 2023. The project is a six -story, 75,340-square-foot mixed-use building with 5,760 square feet of ground floor commercial, 82 apartment units, and an open space/plaza area for the Firefighters’ Memorial (Attachment C). This project is currently in building plan check.
Lot 4:
Lot 4 (APNs: 123 -043-007, 008, 010, 011, 013, 014) is approximately 0.84 acre in size and is currently a parking lot serving the Ruffoni building that houses various City offices, 4 including Community Development and City Engineering. The parking lot also serves other nearby businesses fronting West Main Street. This lot is considered as a future option after progress on Lots 1, 2, and 3.
Summary Terms
The City proposes terms to incentivize and stimulate new development on these identified surplus lots to advance City goals of Downtown revitalization and economic development.
The terms are summarized in a table in Attachment D and are detailed in the exhibits for the Sales and Disposition Agreement in Attachment E. The Lots are listed in the table in the order of development timing, with Lot 3 scheduled for completion first, then Lots 2 and
1. Vernon Group proposes to construct new mixed -use development, including housing (with 25 percent of the units as income -restricted affordable), commercial uses such as restaurants, and added plazas and open space.
To incentivize development, the City offers the following key incentives:
Discounted price for each Lot at $120,000
Use of the Town Center parking structure on Main Street 50 percent discount on Planning and Building fees, and growth mitigation fees for City Hall, Consolidated Corporation Yard, Police, Fire, Traffic, and Library (depending on final unit count and square footage constructed, is estimated to be over $2 million)
These concessions are subject to performance requirements, including adherence to proposed timing for milestones. While not necessarily a part of the agreement, the City is also spending approximately $3.5 million (in REAP 2.0 and ARPA grant fund ing combined) on Downtown infrastructure, including sewer line upgrades, a bus rapid transit station, and other pedestrian improvements.
Timing
For each lot, one year is allotted for Planning review and approval, and preparation of construction plans. Six months are allotted for construction plan review and three years are allotted for construction following construction plan approval. Given the time set aside for plan preparation, review processes, and construction, we could see completion of the following:
Lot 3 (Alvin Newton Apartments) before January 2028
Lot 2 (Perlman Apartments) before March 2029
Lot 1 before December 2031
Lot 4 (as an option) after Lots 1, 2, and 3
Alternative(s)
The City Council can choose not to approve the agreement and provide further direction to staff, which could include further negotiations with the Vernon Group.
5 Fiscal Considerations
The City’s partnership with Vernon Group for the redevelopment of these parcels would result in economic benefits through new housing, commercial activities, and generating increased sales and property taxes. The enhancement of the City’s Downtown will have broader impacts, as new amenities are built and Downtown is seen as a key destination on the Central Coast, inviting added business and tourism. The City is providing several million dollars in concessions, in the form of fee reductions, infrastructure i nvestments, and reduced land prices, but recognizes the investments of the development group. The Vernon Group reports that total Downtown investment is over $150 million.
Impact to the Community
This SDA is a turning point in the progress of the City’s D owntown, with a proposal to change the Downtown into a place that brings in new housing, new commercial uses, and inviting plazas and open spaces for gathering. Existing businesses should see additional foot traffic and increased sales revenue. Residents and visitors will be able to enjoy new activities introduced by the redeveloped spaces. Enhancing the City’s urban core will also have a positive impact to surrounding neighborhoods, as downtown becomes an attractive and vibrant destination. The City will a lso work with downtown businesses to ensure a greater sense of safety in Downtown, with more “eyes on the street,” and a commitment to keep Downtown clean and safe. The approval of the SDA with Vernon Group will provide a path for transformative redevelopm ent to be completed within the next eight years.
ATTACHMENTS
Attachment A: Overall Site Plan
Attachment B: Lot 2 Plans
Attachment C: Lot 3 Plans (Alvin Newton Apartments)
Attachment D: Summary Terms
Attachment E: Sales and Disposition Agreement between City of Santa Maria and Vernon Group
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA
MARIA, CALIFORNIA, APPROVING A SALES AND DISPOSITION
AGREEMENT BETWEEN THE CITY OF SANTA MARIA AND VERNON
PROPERTY GROUP, LLC FOR VARIOUS SURPLUS LAND IN
DOWNTOWN, INCLUDING PARCELS IDENTIFIED AS LOTS 1
THROUGH 4
WHEREAS, the City of Santa Maria (property owner) and Vernon Property Group, LLC, wish to enter into a Sales and Disposition Agreement ( SDA) pertaining to City - owned surplus land, associated with multiple mixed -use developments, with housing, commercial uses, plazas and open space , to be located on the following Downtown parcels:
Approximately 2 acres located south of Main Street and west of Broadway Avenue in Santa Maria, California, known as Santa Barbara County As sessor’s Parcel Nos. (“APN”) 123-280-026, known as “Lot 1”;
Approximately 1.12 acres located at the intersection of Main Street and Broadway Avenue on the northeast corner, in Santa Maria, California, known as Santa Barbara County Assessor’s Parcel Nos. (“APN”) 121-224-035, known as “Lot 2”; Approximately 0.62 acre located at the intersection of Main Street and Broadway Avenue on the southeast corner, in Santa Maria, California, known as “Lot 3”; Approximately 0.84 acre located at the intersection of Lincoln and Church Streets on the northwest corner, in Santa Maria, California, known as Santa Barbara County Assessor’s Parcel Nos. (“APN”) 123 -043-007, 008, 010, 011, 013, 014, known as “Lot 4”);
(Lots 1, 2, 3 4 collectively referred to as “City Property” or separately referred to as “Lot”); and
WHEREAS, the City has adopted plans to establish a vision and develop regulations and guidelines to facilitate the redevelopment of the Downtown area (Downtown), including an update to the Downtown Specific Plan in 2015 and the adoption of the Downtown Streetscape Plan in 2019; and
WHEREAS, on June 1, 2021, through the adoption of Resolution 2021-54, the City Council designated City Property as described above as surplus land, and subsequently completed Surplus Land Act requirements (Government Code § 54221), including statutory notifications and good-faith negotiations with interested parties; and WHEREAS, City staff worked with Vernon Property Group, LLC on project and design expectations to meet the Downtown Specific Plan’s vision of a pedestrian-oriented city center, and principles of enhancing downtown identity and economic viability; and WHEREAS, a duly noticed meeting was held to discuss the terms of the SDA by the Santa Maria City Council on August 20, 2024; and
WHEREAS, the City Council heard and considered all evidence, including evidence presented in the staff report and all written and oral comments, and considered all written and oral comments; and
WHEREAS, the City Council finds the following:
The SDA is consistent with the goals, objectives, policies, general land uses , and programs specified in the City’s General Plan.
The SDA is compatible with the uses authorized in and the regulations prescribed in the 2015 Downtown Specific Plan.
The SDA is in conformity with public convenience, general welfare , and good land use practice.
NOW, THEREFORE, IT IS HEREBY RESOLVED by the City Council of the City of Santa Maria, California, as follows:
1. The City Council hereby approves the Sales and Disposition Agreement, substantially in the form incorporated herein by reference and attached as Attachment E to the August 20, 2024, Council Agenda Report, subject to such minor and clarifying changes consistent with the terms thereof as may be approved by the City Attorney prior to execution thereof.
2. The City Manager and/or his designee is hereby authorized and directed to perform al l acts required by the City in the administration of the Sales and Disposition Agreement pursuant to the terms of the Sales and Disposition Agreement. The City Manager, or designee, is further authorized and directed to perform all other acts, enter into all other agreements, and execute all other documents necessary or convenient to carry out the purposes of this Resolution and the Sales and Disposition Agreement.
3. The Chief Deputy City Clerk is hereby authorized to make minor changes herein to address cle rical errors, so long as substantial conformance of the intent of this document is maintained. In doing so, the Chief Deputy City Clerk shall consult with the City Manager and City Attorney concerning any changes deemed necessary.
///
///
///
PASSED AND ADOPTED at a regular meeting of the City Council of the City of Santa Maria held this 20th day of August 2024.
Mayor
ATTEST:
Chief Deputy City Clerk
APPROVED AS TO FORM:
BY:
CITY ATTORNEY
CONTENTS:
BY:
DEPARTMENT DIRECTOR
BY:
INTERIM CITY MANAGER
3 4
2 4
a2
TOWN CENTER
PLACEMAKING
AMENITIES
overall site plan
EXISTING BUILDING
(maya restaurant)
EXISTING
BUILDING
SPANISH
STEPS
EXISTING
parking
structure
EXISTING
BUILDING
EXISTING
BUILDING
EXISTING
BUILDING EXISTING
BUILDING
EXISTING
BUILDING
EXISTING
BUILDING
EXISTING
BUILDING
HERITAGE WALK
Lobby/Amenity
Commercial Space
Flex Space
Vertical Circulation
1 EXISTING
BUILDING
S. BROADWAY
W. MAIN STREET
67 5
lincoln street
church street
town center
plaza
town center
plaza
1 2
5 3
6 4
7 LOT 1
LOT 2 - Affordable
LOT 3 - Alvin Newton Apts.
LOT 4
The Lofts
Boot Barn
222 W Main St
EXISTING BRIDGE CONNECTION
Attachment A
4 4
1 2
5 3
6 4
7 LOT 1
LOT 2 - Affordable
LOT 3 - Alvin Newton Apts.
LOT 4
The Lofts
Boot Barn
222 W Main St
2 3
6 S. BROADWAY
5 1
town center
plaza
lot 1
podium
level
podium
level
public
courtyard
Public Lot Imp.
Private Lot Imp.
Building Area
216,500
25,900
229,600
46%
5%
49%
a3
TOWN CENTER
PLACEMAKING
AMENITIES
W. MAIN STREET
improvements area
lincoln street
heritage walk
7 church street
public
courtyard
1 EXISTING BRIDGE CONNECTION
spanish
steps
public
courtyard
Date01-30-2024
Job No.
Scale
2023-0592
Date
Job No.
Scale
100 N BROADWAY
Santa Maria, CA
Conceptual 3D ViewAX.X
1" = 20'
20'40'60' 080'
Southwest Corner View - E. Main Street and N. Broadway
Attachment B
Date01-30-2024
Job No.
Scale
2023-0592
Date
Job No.
Scale
100 N BROADWAY
Santa Maria, CA
Conceptual 3D ViewAX.X
1" = 20'
20'40'60' 080'
South Elevation - E. Main Street
8'-1"
10'-2"
9'-6"
8'-2"
8'-1"
7'-10"
7'-7"
10'-2"
###
0 000
10'-0" x 20'-0"
UP
DN
BOILER
ROOM
LEASING
OFFICE
PARKING
ENTRY5 STORY OVER 1 LEVEL OF PODIUM
±76 STALLS
MAIL
ELECTRICAL
ROOM ELEV
ROOM
STORAGE
STRG.
TRASH
COLLECTION
ELEV
ROOM
MAINTENANCE
ROOM
MPOE
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6'-6"
150'-0"
77'-7"
75'-11"
5' DIA.
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N BROADWAY
E MAIN STREET
PROJECT DATA
LOCATION:100 N. BROADWAY
SANTA MARIA, CA 93454
EXISTING USE: PARK
5-STORY RESIDENTIAL OVER 1 LEVEL OF RAISED PODIUM
SITE AREA: ± 1.2 ACRE
DENSITY: ± 125.8 DU/AC
OVERALL FAR:± 3.84
TOTAL UNIT COUNT: ± 151 UNITS
STUDIOS:± 15 UNITS (10%)
1-BDRM:± 54 UNITS (36%)
2-BDRM:± 37 UNITS (25%)
± 1 UNIT (MANAGER'S
UNIT)
3-BDRM:± 43 UNITS (29%)
± 1 UNIT (MANAGER'S
UNIT)
PARKING PROVIDED : ± 76 STALLS
PARKING RATIO :0.5 STALLS/DU
RESIDENTIAL FLOOR AREA:± 159,288 SF
NON-RESIDENTIAL FLOOR AREA*: ± 41,400 SF
TOTAL FLOOR AREA:± 200,688 SF
*NON-RESIDENTIAL FLOOR AREA INCLUDES PODIUM
PARKING, MAIL ROOM, AND LEASING OFFICE.
Date01-30-2024
Job No.
Scale
2023-0592
Date
Job No.
Scale
100 N BROADWAY
Santa Maria, CA
Conceptual Site PlanA1.0
1" = 20'
20' 40'60' 080'
NORTH
PROJECT
LOCATION
E MAIN STREET
N BROADWAY
HWY
101
VICINITY MAP (N.T.S.)
NORTH
5' DIA.
48'-10"
71'-8"
61'-5"
42'-5"
8'-1"
13'-10"
16'-6"
6'-2"
7'-1"
6'-0"
7'-6"
6'-0"
11'-10"
11'-1"
6'-6"
E MAIN STREET
N BROADWAY
A2 B1
A2
A2
A2
COURTYARD
A2
A1
A1
B1
COURTYARD
LAUNDRY
A1
C1
S1 S1
C1
B1
PASSAGEWAY
C2
C2
PASSAGEWAY
A1
B1
C2
A2
A1
JAN
S1
C2 C2
B1
C1
B1
C1
B1
AMENITIES
B1
AMENITIES
Date01-30-2024
Job No.
Scale
2023-0592
Date
Job No.
Scale
100 N BROADWAY
Santa Maria, CA
Conceptual
Typical Upper Plan
A1.1
1" = 20'
20'40'60' 080'
NORTH
PROJECT
LOCATION
E MAIN STREET
N BROADWAY
HWY
101
VICINITY MAP (N.T.S.)
NORTH
PROJECT DATA
LOCATION:100 N. BROADWAY
SANTA MARIA, CA 93454
EXISTING USE: PARK
5-STORY RESIDENTIAL OVER 1 LEVEL OF RAISED PODIUM
SITE AREA: ± 1.2 ACRE
DENSITY: ± 125.8 DU/AC
OVERALL FAR:± 3.84
TOTAL UNIT COUNT: ± 151 UNITS
STUDIOS:± 15 UNITS (10%)
1-BDRM:± 54 UNITS (36%)
2-BDRM:± 37 UNITS (25%)
± 1 UNIT (MANAGER'S
UNIT)
3-BDRM:± 43 UNITS (29%)
± 1 UNIT (MANAGER'S
UNIT)
PARKING PROVIDED : ± 76 STALLS
PARKING RATIO :0.5 STALLS/DU
RESIDENTIAL FLOOR AREA:± 159,288 SF
NON-RESIDENTIAL FLOOR AREA*: ± 41,400 SF
TOTAL FLOOR AREA:± 200,688 SF
*NON-RESIDENTIAL FLOOR AREA INCLUDES PODIUM
PARKING, MAIL ROOM, AND LEASING OFFICE.
LEVEL 1
(+0")
13'-2" 10'-11" 10'-11" 10'-11" 10'-11"
LEVEL 2
(+13'-2")
LEVEL 3
(+24'-1")
LEVEL 4
(+35'-0")
LEVEL 5
(+45'-11")
T.O. ROOF
(+67'-9")
78'-6"
AVG. PARAPET
(+71'-9")
4'-0"
T.O. STAIR
(+78'-6")
10'-11" LEVEL 5
(+56'-10")
10 6126617 1513 91 95
LEVEL 1
(+0")
13'-2" 10'-11" 10'-11" 10'-11" 10'-11"
LEVEL 2
(+13'-2")
LEVEL 3
(+24'-1")
LEVEL 4
(+35'-0")
LEVEL 5
(+45'-11")
T.O. ROOF
(+67'-9")
78'-6"
AVG. PARAPET
(+71'-9")
4'-0"
T.O. STAIR
(+78'-6")
10'-11" LEVEL 5
(+56'-10")
10 361287107 1143 15 9 3
LEVEL 1
(+0")
13'-2" 10'-11" 10'-11" 10'-11" 10'-11"
LEVEL 2
(+13'-2")
LEVEL 3
(+24'-1")
LEVEL 4
(+35'-0")
LEVEL 5
(+45'-11")
T.O. ROOF
(+67'-9")
78'-6"
AVG. PARAPET
(+71'-9")
4'-0"
T.O. STAIR
(+78'-6")
10'-11" LEVEL 5
(+56'-10")
8 9632797 10235 51 110 1
LEVEL 1
(+0")
13'-2" 10'-11" 10'-11" 10'-11" 10'-11"
LEVEL 2
(+13'-2")
LEVEL 3
(+24'-1")
LEVEL 4
(+35'-0")
LEVEL 5
(+45'-11")
T.O. ROOF
(+67'-9")
78'-6"
AVG. PARAPET
(+71'-9")
4'-0"
T.O. STAIR
(+78'-6")
10'-11" LEVEL 5
(+56'-10")
9 611691165 51 15 5
1STUCCO - SAND FINISH
2STOREFRONT
3METAL RAILING
4WOOD RAILING
5ARCHITECTURAL TRIM
6VINYL WINDOWS
7CERAMIC TILE
8METAL AWNING
9ROOF TILE
10MURAL (TBD)
Date01-30-2024
Job No.
Scale
2023-0592
Date
Job No.
Scale
100 N BROADWAY
Santa Maria, CA
Conceptual
Building Elevations
A2.0
1" = 20'
1. South Elevation - Main St
20' 40'60' 080'
KEY MAP
MAIN STREET
N BROADWAY
BUILDING
2. East Elevation
1 2
3 4
3. North Elevation
4. West Elevation - Broadway
LEGEND
01-GROUND FLOOR
0' - 0"
02 - SECOND FLOOR
16' - 0"
07-ROOF
67' - 3 5/8"
08-T.O. PARAPET
73' - 4 5/8"
03-THIRD FLOOR
26' - 1 5/8"
04 - FOURTH FLOOR
36' - 4 3/4"
05 - FIFTH FLOOR
46' - 7 7/8"
06 - SIXTH FLOOR
57' - 1 1/8"
01.1-GROUND FLOOR 2
0' - 6"
MAX HT PER CBC
85' - 0"
PENTHOUSE PLATE
77' - 4 5/8"
01.2-GROUND FLOOR 3
2' - 0"
rrmdesign.com | (805) 543-1794
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AGENCY
NO. REVISION DATE
PROJECT MANAGER
DRAWN BY CHECKED BY
DATE
PROJECT NUMBER
SHEET
NOT FO
R
CO
NS
TRUCTIO
N
NOT FO
R
CO
NS
TRUCTIO
N
RRM DESIGN GROUP COPYRIGHT 2024
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THE INCLUDED DRAWINGS, SPECIFICATIONS, IDEAS, DESIGNS AND ARRANGEMENTS
REPRESENTED THEREBY ARE AND SHALL REMAIN THE PROPERTY OF RRM DESIGN
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Autodesk Docs://2121_SM Downtown REdev/2121-04-RS23_Alvin Newton Mixed-Use Building_V22.rvt 6/6/2024 2:35:48 PM
SOUTH ELEVATION
ALVIN NEWTON MIXED-USE
EAST MAIN ST & SOUTH BROADWAY,
SANTA MARIA, CA 93454
2121-04-RS23
A-1
MAY 30, 2024
DJC
JM
SCALE: 1/8" = 1'-0"A-1
SOUTH ELEVATION-DESIGN DEVELOPMENT1
SCALE: 1/8" = 1'-0"A-1
SOUTH ELEVATION-ENTITLEMENTS2
WINDOW
AWNINGS
STANDARDIZED FOR
DURABILITY AND
CONSTRUCTABILITY
CONCERNS
WINDOWS RESIZED,
ADDED, OR
REMOVED PER UNIT
LAYOUT
DEVELOPMENT
Attachment C
01 -GROUND FLOOR
0' - 0"
02 - SECOND FLOOR
16' - 0"
07 -ROOF
67' - 3 5/8"
08 -T.O. PARAPET
73' - 4 5/8"
03 -THIRD FLOOR
26' - 1 5/8"
04 - FOURTH FLOOR
36' - 4 3/4"
05 - FIFTH FLOOR
46' - 7 7/8"
06 - SIXTH FLOOR
57' - 1 1/8"
MAX HT PER CBC
85' - 0"
PENTHOUSE PLATE
77' - 4 5/8"
rrmdesign.com | (805) 543-1794
CONSULTANT
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NO. REVISION DATE
PROJECT MANAGER
DRAWN BY CHECKED BY
DATE
PROJECT NUMBER
SHEET
NOT FO
R
CO
NS
TRUCTIO
N
NOT FO
R
CO
NS
TRUCTIO
N
RRM DESIGN GROUP COPYRIGHT 2024
RRM IS A CALIFORNIA CORPORATION
THE INCLUDED DRAWINGS, SPECIFICATIONS, IDEAS, DESIG NS AND ARRANGEMENTS
REPRESENTED THEREBY ARE AND SHALL REMAIN THE PROPER TY OF RRM DESIGN
GROUP AND NO PART THEREOF SHALL BE COPIED, DISCLOSE D TO OTHERS OR
USED IN CONNECTION WITH ANY WORK OR PROJECT OTHER T HAN THE SPECIFIED
PROJECT FOR WHICH THEY HAVE BEEN PREPARED AND DEVEL OPED WITHOUT THE WRITTEN CONSENT OF RRM DESIGN GROUP. VISUAL CONTACT WITH THESE DRAWINGS
OR SPECIFICATIONS SHALL CONSTITUTE CONCLUSIVE EVIDE NCE OF ACCEPTANCE OF THESE RESTRICTIONS. SUBMITTAL OF THESE DOCUMENTS FO R PUBLIC AGENCY REVIEW SHALL NOT BE CONSIDERED A WAIVER OF RRM DESIGN GROU P'S RIGHTS.
Autodesk Docs://2121_SM Downtown REdev/2121-04-RS23_Alvin Newton Mixed-Use Building_V22.rvt 6/6/2024 2:35:57 PM
NORTH ELEVATION
ALVIN NEWTON MIXED-USE
EAST MAIN ST & SOUTH BROADWAY,
SANTA MARIA, CA 93454
2121-04-RS23
A-2
MAY 30, 2024
DJC
JM
SCALE: 1/8" = 1'-0" A-2
NORTH ELEVATION-DESIGN DEVELOPMENT 1
SCALE: 1/8" = 1'-0" A-2
NORTH ELEVATION-ENTITLEMENTS2
WINDOWS RESIZED,
ADDED, OR
REMOVED PER UNIT
LAYOUT
DEVELOPMENT
RECESSES
INCORPORATED
FOR UNIT
BALCONIES
BALCONY RAILING
INCORPORATED
FOR UNIT
BALCONIES
MASSING PUSHED
BACK DUE TO TESLA
CHARGING
STATION CONFLICT
TESLA CHARGING
STATION LOCATION
01 -GROUND FLOOR
0' - 0"
02 - SECOND FLOOR
16' - 0"
07 -ROOF
67' - 3 5/8"
08 -T.O. PARAPET
73' - 4 5/8"
03 -THIRD FLOOR
26' - 1 5/8"
04 - FOURTH FLOOR
36' - 4 3/4"
05 - FIFTH FLOOR
46' - 7 7/8"
06 - SIXTH FLOOR
57' - 1 1/8"
MAX HT PER CBC
85' - 0"
PENTHOUSE PLATE
77' - 4 5/8"
01 -GROUND FLOOR
0' - 0"
02 - SECOND FLOOR
16' - 0"
07 -ROOF
67' - 3 5/8"
08 -T.O. PARAPET
73' - 4 5/8"
03 -THIRD FLOOR
26' - 1 5/8"
04 - FOURTH FLOOR
36' - 4 3/4"
05 - FIFTH FLOOR
46' - 7 7/8"
06 - SIXTH FLOOR
57' - 1 1/8"
MAX HT PER CBC
85' - 0"
PENTHOUSE PLATE
77' - 4 5/8"
rrmdesign.com | (805) 543-1794
CONSULTANT
AGENCY
NO. REVISION DATE
PROJECT MANAGER
DRAWN BY CHECKED BY
DATE
PROJECT NUMBER
SHEET
NOT FO
R
CO
NS
TRUCTIO
N
NOT FO
R
CO
NS
TRUCTIO
N
RRM DESIGN GROUP COPYRIGHT 2024
RRM IS A CALIFORNIA CORPORATION
THE INCLUDED DRAWINGS, SPECIFICATIONS, IDEAS, DESIG NS AND ARRANGEMENTS
REPRESENTED THEREBY ARE AND SHALL REMAIN THE PROPER TY OF RRM DESIGN
GROUP AND NO PART THEREOF SHALL BE COPIED, DISCLOSE D TO OTHERS OR
USED IN CONNECTION WITH ANY WORK OR PROJECT OTHER T HAN THE SPECIFIED
PROJECT FOR WHICH THEY HAVE BEEN PREPARED AND DEVEL OPED WITHOUT THE WRITTEN CONSENT OF RRM DESIGN GROUP. VISUAL CONTACT WITH THESE DRAWINGS
OR SPECIFICATIONS SHALL CONSTITUTE CONCLUSIVE EVIDE NCE OF ACCEPTANCE OF THESE RESTRICTIONS. SUBMITTAL OF THESE DOCUMENTS FO R PUBLIC AGENCY REVIEW SHALL NOT BE CONSIDERED A WAIVER OF RRM DESIGN GROU P'S RIGHTS.
Autodesk Docs://2121_SM Downtown REdev/2121-04-RS23_Alvin Newton Mixed-Use Building_V22.rvt 6/6/2024 2:36:11 PM
WEST AND EAST ELEVATION
ALVIN NEWTON MIXED-USE
EAST MAIN ST & SOUTH BROADWAY,
SANTA MARIA, CA 93454
2121-04-RS23
A-3
MAY 30, 2024
DJC
JM
SCALE: 1/8" = 1'-0" A-3
WEST ELEVATION-DESIGN DEVELOPMENT 1
SCALE: 1/8" = 1'-0" A-3
WEST ELEVATION-ENTITLEMENTS2
SCALE: 1/8" = 1'-0" A-3
EAST ELEVATION-DESIGN DEVELOPMENT 3
SCALE: 1/8" = 1'-0" A-3
EAST ELEVATION-ENTITLEMENTS4
MASSING PUSHED
BACK DUE TO TESLA
CHARGING
STATION CONFLICT
TESLA CHARGING
STATION LOCATION
OPENING AMOUNT
REDUCED FOR
CODE DUE TO
PROXIMITY TO
PROPERTY LINE
NEW OPENINGS
DUE TO MASSING
BEING PUSHED
BACK TO AVOID
CONFLICT WITH
TESLA CHARGING
STATION
WINDOWS RESIZED,
ADDED, OR
REMOVED PER UNIT
LAYOUT
DEVELOPMENT
WINDOWS RESIZED,
ADDED, OR
REMOVED PER UNIT
LAYOUT
DEVELOPMENT
rrmdesign.com | (805) 543-1794
CONSULTANT
AGENCY
NO. REVISION DATE
PROJECT MANAGER
DRAWN BY CHECKED BY
DATE
PROJECT NUMBER
SHEET
NOT FO
R
CO
NS
TRUCTIO
N
NOT FO
R
CO
NS
TRUCTIO
N
RRM DESIGN GROUP COPYRIGHT 2024
RRM IS A CALIFORNIA CORPORATION
THE INCLUDED DRAWINGS, SPECIFICATIONS, IDEAS, DESIG NS AND ARRANGEMENTS
REPRESENTED THEREBY ARE AND SHALL REMAIN THE PROPER TY OF RRM DESIGN
GROUP AND NO PART THEREOF SHALL BE COPIED, DISCLOSE D TO OTHERS OR
USED IN CONNECTION WITH ANY WORK OR PROJECT OTHER T HAN THE SPECIFIED
PROJECT FOR WHICH THEY HAVE BEEN PREPARED AND DEVEL OPED WITHOUT THE WRITTEN CONSENT OF RRM DESIGN GROUP. VISUAL CONTACT WITH THESE DRAWINGS
OR SPECIFICATIONS SHALL CONSTITUTE CONCLUSIVE EVIDE NCE OF ACCEPTANCE OF THESE RESTRICTIONS. SUBMITTAL OF THESE DOCUMENTS FO R PUBLIC AGENCY REVIEW SHALL NOT BE CONSIDERED A WAIVER OF RRM DESIGN GROU P'S RIGHTS.
Autodesk Docs://2121_SM Downtown REdev/2121-04-RS23_Alvin Newton Mixed-Use Building_V22.rvt 6/6/2024 2:36:18 PM
TYPICAL 2ND THROUGH 6TH
FLOOR
ALVIN NEWTON MIXED-USE
EAST MAIN ST & SOUTH BROADWAY,
SANTA MARIA, CA 93454
2121-04-RS23
A-4
MAY 30, 2024
DJC
JM
SCALE: 1/8" = 1'-0" 1
TYPICAL 2ND THROUGH 6TH FLOOR
PLAN-DESIGN DEVELOPMENT
THIS MASSING HAS
BEEN PUSHED BACK
TO AVOID
CONFLICT WITH
TESLA CHARGING
STATION
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
DS
OPEN ROOF
DECK BELOW
5" / 1'-0"
5" / 1'-0"
6" / 1'-0"
6" / 1'-0"
6" / 1'-0"
6" / 1'-0"
6" / 1'-0"
6" / 1'-0"
6" / 1'-0"
6" / 1'-0"
5" / 1'-0" 5" / 1'-0"
5" / 1'-0"
5" / 1'-0"
6" / 1'-0"
6" / 1'-0"
5" / 1'-0"
5" / 1'-0"
5" / 1'-0"
5" / 1'-0"
6" / 1'-0"
5" / 1'-0"
5" / 1'-0"
1/2" / 1'-0" 1/2" / 1'-0"
1/2" / 1'-0" 1/2" / 1'-0"
3 1/2" / 1'-0"
6" / 1'-0"
1/2" / 1'-0" 1/2" / 1'-0"
1/2" / 1'-0" 1/2" / 1'-0"
1/2" / 1'-0" 1/2" / 1'-0"
1/2" / 1'-0" 1/2" / 1'-0"
1/2" / 1'-0"
1/2" / 1'-0"
5" / 1'-0" 5" / 1'-0"
5" / 1'-0" 5" / 1'-0"
5" / 1'-0"
5" / 1'-0" 5" / 1'-0"
5" / 1'-0"
6" / 1'-0"
6" / 1'-0"
6" / 1'-0"
6" / 1'-0"
6" / 1'-0"
rrmdesign.com | (805) 543-1794
CONSULTANT
AGENCY
NO. REVISION DATE
PROJECT MANAGER
DRAWN BY CHECKED BY
DATE
PROJECT NUMBER
SHEET
NOT FO
R
CO
NS
TRUCTIO
N
NOT FO
R
CO
NS
TRUCTIO
N
RRM DESIGN GROUP COPYRIGHT 2024
RRM IS A CALIFORNIA CORPORATION
THE INCLUDED DRAWINGS, SPECIFICATIONS, IDEAS, DESIG NS AND ARRANGEMENTS
REPRESENTED THEREBY ARE AND SHALL REMAIN THE PROPER TY OF RRM DESIGN
GROUP AND NO PART THEREOF SHALL BE COPIED, DISCLOSE D TO OTHERS OR
USED IN CONNECTION WITH ANY WORK OR PROJECT OTHER T HAN THE SPECIFIED
PROJECT FOR WHICH THEY HAVE BEEN PREPARED AND DEVEL OPED WITHOUT THE WRITTEN CONSENT OF RRM DESIGN GROUP. VISUAL CONTACT WITH THESE DRAWINGS
OR SPECIFICATIONS SHALL CONSTITUTE CONCLUSIVE EVIDE NCE OF ACCEPTANCE OF THESE RESTRICTIONS. SUBMITTAL OF THESE DOCUMENTS FO R PUBLIC AGENCY REVIEW SHALL NOT BE CONSIDERED A WAIVER OF RRM DESIGN GROU P'S RIGHTS.
Autodesk Docs://2121_SM Downtown REdev/2121-04-RS23_Alvin Newton Mixed-Use Building_V22.rvt 6/6/2024 2:36:20 PM
ROOF PLAN
ALVIN NEWTON MIXED-USE
EAST MAIN ST & SOUTH BROADWAY,
SANTA MARIA, CA 93454
2121-04-RS23
A-5
MAY 30, 2024
DJC
JM
SCALE: 1/8" = 1'-0" A-1 A-5
ROOF PLAN-ENTITLEMENTS2
SCALE: 1/8" = 1'-0" A-1 A-5
ROOF PLAN-DESIGN DEVELOPMENT 1
Attachment D
City of Santa Maria and Vernon Construction Group – Sales and Disposition Agreement Summary of Terms
Property Project Description Timing (subject to
meeting milestones)
City Concessions (subject
to meeting milestones)
Lot 3 – Alvin
Newton
• 82 apartments
• Ground floor
commercial, with
minimum 4,500 sq. ft.
for dining/food
establishments
• Firefighters’ memorial
plaza
• Planning entitlements
approved 10/3/23
• Submit building plans
by 7/25/24
• Approval of building
plans by 1/25/25
• Complete
construction 3 years
from building plan
approval (1/25/28)
• 50% discount on
Planning and Building
fees and selected
growth mitigation fees
• Water and sewer public
improvements (or
reimbursement of
infrastructures costs
up to $800,000)
• Use of Town Center
parking structure
• Purchase price of
$120,000
Lot 2 –
Perlman
• 160 affordable
apartments (overall 60
percent AMI)
• Pedestrian connection
from Central Plaza
Park to corner of Main
and Broadway
• Submit planning
application by 9/20/24
• Submit building plans
by 9/20/25
• Approval of building
plans by 3/20/26
• Complete
construction 3 years
from building plan
approval (3/20/29)
• 50% discount on
Planning and Building
fees and selected
growth mitigation fees
• Use of Town Center
parking structure
• Purchase price of
$120,000
Lot 1 – Town
Center West
• Up to 375 residential
units
• 10,000 sq. ft. of
commercial uses,
with minimum of
5,000 sq. ft. for
dining/food
• Reconstruction of
Heritage Walk, plazas
and outdoor gathering
areas
• Submit planning
application by
12/31/26
• Submit building plans
by 6/30/28
• Approval of building
plans by 12/30/28
• Complete
construction 3 years
from building plan
approval (12/30/31)
• 50% discount on
Planning and Building
fees and selected
growth mitigation fees
• Use of Town Center
parking structure
• Purchase price of
$120,000
1 RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:
City of Santa Maria
Attn: City Clerk
110 E. Cook Street, Room 3
Santa Maria, CA 93454
No Fee Per Government Code Section 6103
______________________________________________________________________________
SALES AND DISPOSITION AGREEMENT
by and among
THE CITY OF SANTA MARIA
And
Vernon Property Group, LLC
A California limited liability company
August 20, 2024
Attachment E
2 THIS SALES AND DISPOSITION AGREEMENT (this “Agreement”) is entered into effective as of August 20, 2024 (“Effective Date”) by and among the City of Santa Maria , a municipal corporation (“City”) and VERNON PROPERTY GROUP, LLC, a California limited liability company (“VERNON” or “Developer”). City and VERNON are collectively referred to herein as the “Parties.”
RECITALS
A. The City is the owner of the real property located south of Main Street and west of Broadway Avenue in Santa Maria, California, known as Santa Barbara County Assessor’s Parcel Nos. (“ APN”) 123-280-026, and more particularly described in Exhibit A -1 and depicted in Exhibit A-2 attached hereto ("Lot 1").
B. The City is the owner of the real property located at the intersection of Main Street and Broadway Avenue on the northeast corner, in Santa Maria, California, known as Santa Barbara County Assessor’s Parcel Nos. (“APN”) 121-224-035, and more particularly described in Exhibit A-4 and depicted in Exhibit A-5 attached hereto ("Lot 2").
C. The City is the owner of the real property located at the intersection of Main Street and Broadway Avenue on the southeast corner, in Santa Maria, California, known as Santa Barbara County Assessor’s Parcel Nos. (“APN”) 125-320-050, and more particularly described in Exhibit A-7 and depicted in Exhibit A-8 attached hereto ("Lot 3").
D. The City is the owner of the real property located at the intersection of Lincoln and Church Stree ts on the northwest corner, in Santa Maria, California, known as Santa Barbara County Assessor’s Parcel Nos. (“ APN”) 123-043-007, 008, 010, 011, 013, 014 , and more particularly described in Exhibit A-10 and depicted in Exhibit A-11 attached hereto ("Lot 4") (Lot 1, 2, 3 4 collectively referred to as "City Property" or separately referred to as "Lot").
E. Following the City’s evaluation of proposals submitted in response to a Request for Developer Qualifications and following the City's compliance with the Stat e Surplus Land Act, the City and the Developer entered into an Exclusive Negotiating Rights Agreement dated as of March 9, 2022 (the “ENA”), pursuant to which the Parties agreed to negotiate the terms for the proposed conveyance and development of the City Property along with adjacent privately owned parcels owned or controlled by Developer.
F. Project Description: Developer has proposed : For Lot 1, the development of a mixed-use project with residences, commercial uses, and outdoor plazas. The rea l property on 3 which the Lot 1 Project is to be developed consists of approximately a one hundred and fifty (150) room "micro-hotel" and two hundred and eighty (280) residential units and is more particularly described in Exhibit A-3 and depicted in Exhibit A-2 attached hereto (the “Lot 1 Project”). For Lot 2, the development of an affordable apartment project . The real property on which the Lot 2 Project is to be developed consists of approximate one hundred and fifty 150 residential units in a five-story high structure over a podium structure with 75 parking stalls provided onsite with the balance to be provided in the adjacent City -owned parking structure and is more particularly described in Exhibit A-6 and depicted in Exhibit A-5 attached hereto (the "Lot 2 Project"). For Lot 3, the development of a mixed -use project. The real property on which the Lot 3 Project is to be developed consists of approximately 5 ,000-6,000 square feet of commercial property and 82 residential units in a six-story high structure and is more particularly described in Exhibit A-9 and depicted in Exhibit A-8 attached hereto (the “Lot 3 Project”). For Lot 4, the real property on which the Lot 4 Project is to be developed consists of approximately 100 residential units and is more particularly described in Exhibit A-11 attached hereto (the "Lot 4 Project") (Lot 1 Project, Lot 2 Project, Lot 3 Project, Lot 4 Project collectively referred to as the " Downtown Development Project"). For the avoidance of doubt, each of the individual projects which are all within the jurisdiction of the City of Santa Maria Downtown Specific Plan may be combined with the other projects described herein. In addition to the above, for the Lot 1 Project and the Lot 4 Project, Developer may seek to create condominium maps for some or all of the residential units that are encompassed within those projects.
G. In connection with the proposed Project s, Developer will apply to City for a Downtown Permit and all other necessary permits (such as Planned Development zoning amendment, a Parcel Map approval, Use Permit, and Design Review ) for each of the Downtown Development Projects. Discretionary approvals by any applicable City body, other than for general design review, may be approved if the proposed project is in accordance with the terms set forth in Exhibits A-3, A-6 and A-9. Additionally, discretionary review may be limited to design review and no story poles will be required to be erected prior to the approval of any permits. (collectively, the “Entitlements”).
H. Upon satisfaction of the conditions precedent set forth in this Agreement and subject to the terms and conditions set forth herein, the City will convey Lot 1, Lot 2 and Lot 3 to Developer for development of the Project on the schedule set forth herein . On or after the Completion Date for each respective project , as defined herein, Developer may sell or lease the City Property associated with that particular project and the improvements located thereon to a third party.
I. Upon Developer's satisfaction of the schedule for construction of Lot 1, Lot 2 and Lot 3 , Developer shall be given an option to purchase Lot 4 from the City on the terms and conditions set forth herein so long as that option is exercised within six (6) years of execution of this Agreement.
4 J. In accordance with Government Code Section 65864 et seq., the City enacted Santa Maria Municipal Code Chapter 12-51, setting forth the required process for reviewing, processing and approving development agreements.
K. A material inducement to City to enter into this Agreement is the agreement by Developer to develop the Downtown Development Projects within the time periods specified herein and in accordance with the provisions hereof, and the City would be unwilling to enter into this Agreement in the absence of an enforceable commitment by Developer to take such actions and complete such work in accordance with such provisions and within such time periods.
L. City published a notice of intention to consider the adoption of this Agreement pursuant to Government Code Section 65090 and 65091 and duly held a public hearing.
M. The City finds the following:
1. This Agreement is consistent with the goals, objectives, policies, general land uses and programs specified in the City’s General Plan.
2. This Agreement is compatible with the uses authorized in and the regulations prescribed in the 2015 Downtown Specific Plan.
3. This Agreement is in conformity with public convenience, general welfare and good land use practice.
NOW, THEREFORE, in consideration of the mutual covenants contained herein and good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows.
ARTICLE I
DEFINITIONS; EXHIBITS; RECITALS; ANNUAL REVIEW
1.1 Definitions. The following terms shall have the meanings set forth below and, in the Sections, referenced below whenever used in this Agreement and the Exhibits attached hereto.
Additional terms are defined in the Recitals and text of this Agreement. “Affiliate” means any corporation, limited liability company, partnership or other entity which directly or indirectly controls, is controlled by, or is under common control with Developer and/or Developer’s Key Principals.
5 “Applicable Laws” is defined in Section 5.15
“Assignment of Intangible Property” is defined in Section 3.7. “Authorized Representative” means the City Manager of the City of Santa Maria, or his or her designee.
“CEQA” means the California Environmental Quality Act, Public Resources Code section 21000 et seq.
“Certificate of Completion” is defined in Section 5.12. “City” means the City of Santa Maria, California, a municipal corporation. “City Council” means the City Council of the City of Santa Maria, California. “City Documents” means collectively, this Agreement, the Memorandum, and the Grant Deed, and such other and further documents as may reasonably be required to complete the Close of Escrow.
"City Property" shall mean the real property collectively known as Lot 1, Lot 2, Lot 3 and more particular described as: ______________________. "City Option Property" shall mean the real property known as Lot 4 and more particularly described as: ____________________.
“Claims” is defined in Section 5.11.
“Closing Date ” or “ Close of Escrow ” shall be the date(s) that escrow closes for the conveyance of the Subject Property from City to Developer. “Commencement Date ” means , for each lot's particula r project, the date two (2) years after Developer’s acquisition of that particular Lot and the close of escrow on th at particular Lot, subject to Force Majeure.
“Completion Date” in defined in Section 5.1
“Conditions of Approval” is defined in Section 5.4.
“Construction Plans” is defined in Section 5.6.
“Developer Documents ” means collectively, this Agreement, the countersigned Grant Deed, and such other and further documents as may reasonably be required to complete the Close of Escrow.
“Design Documents” is defined in Section 2.4.
“Developer” means, VERNON Property Group LLC, a California limited liability company, or its assignee.
6 “Developer’s Permitted Exceptions” is defined in Section 3.1. “Economic Force Majeure” is defined in Section 11.2.2.
“ENA” is defined in Recital B.
“Entitlements” is defined in Recitals B-C.
“Environmental Laws” is defined in Section 6.9.2.
“Escrow Agent” is defined in Section 3.3.
“Force Majeure” is defined in Section 11.2.
“Good Faith Deposit” means the good faith deposit provided by the Developer (or an Affiliate of Developer) for each particular Lot, in the amount of Ten Thousand and 00/100 Dollars ($10,000.00) for each particular Lot, and all interest that is earned on the Good Faith Deposit after the City deposits the Good Faith Deposit in an interest-bearing account. “Grant Deed” is defined in Section 3.1.
“Hazardous Material” is defined in Section 6.9.1.
“Improvements” means the improvements to be constructed on the Property pursuant to this Agreement.
“Indemnitees” is defined in Section 5.11.
“Independent Consideration” is defined in Section3.3(a). “Key Principals” is defined as the shareholders and/or principals of Developer, i.e., Brad Vernon, Brett Vernon or any other officer, director, or majority shareholder or member of Developer as of the date of this Agreement.
“Lender’s Title Policy” is defined in Section 3.8.
"Lot 1" is defined in Recital A
"Lot 2" is defined in Recital A
"Lot 3” is defined in Recital A
"Lot 4" is defined in Recital A
“Memorandum” is defined in Section 3.7(e).
“Official Records” means the Official Records of Santa Barbara County. 7 “Owner’s Title Policy” is defined in Section 3.8.
“Permitted Transfer” is defined in Section 7.3
“Planning Commission” means the Planning Commission of the City of Santa Maria.
“Downtown Development Project” is defined in Recital C. “Project CEQA Documentation” is defined in Recital E.
“Project Site” means the real property that consists of the Subject Property. “Repurchase Option” is defined in Section 9.9.
“Title Company” is defined in Section 3.3.
“Title Report” is defined in Section 3.1.
“Transfer” is defined in Section 7.2.
1.2 Exhibits. The following Exhibits are attached hereto and incorporated into this Agreement by this reference:
A-1 Legal Description – Lot 1
A-2 Site Map – Lot 1
A-3 Developers Representation and Project Description – Lot 1 A-4 Legal Description – Lot 2
A-5 Site Map – Lot 2
A-6 Developers Representation and Project Description – Lot 2 A-7 Legal Description – Lot 3
A-8 Site Map – Lot 3
A-9 Developers Representation and Project Description – Lot 3 A-10 Legal Description – Lot 4
A-11 Site Map – Lot 4
B-1 Performance Schedule and Incentives – Lot 1
B-2 Performance Schedule and Incentives – Lot 2
B-3 Performance Schedule and Incentives – Lot 3
C Form of Certificate of Completion
D Form of Memorandum of Option
E Form of Grant Deed and Reservation of Easement
1.3 Recitals. The above recitals are hereby incorporated into this Agreement as though set forth in full herein.
8 1.4 Annual Review. City shall in compliance with Section 12-51.05 of the Santa Maria Municipal Code, not less than every twelve months from the Effective Date, review Developer’s compliance with the terms and conditions of this Agreement.
ARTICLE II
REPRESENTATIONS; EFFECTIVE DATE; FINANCIAL CAPACITY
2.1 Representations.
2.1.1 Developer’s Representations. Developer covenants that until the issuance of a Certificate of Occupancy for each of the respective Lot Projects upon reasonable discovery of any fact or condition that would cause any of the warranties and representations in Section 2.1.1 to be untrue, Developer shall promptly, and no later than thirty (30) days, give written notice of such fact or condition to City for that particular Lot Project . Developer acknowledges that City shall rely upon Developer’s representations made herein notwithstanding any investigation made by or on behalf of City. Developer acknowledges that City shall rely upon Developer’s representations made herein notwithsta nding any investigation made by or on behalf of City. Developer hereby represents, warrants, and covenants that the following are true and correct as of the Effective Date.
(a) Organization. Developer is a limited liability company, duly organized and in good standing under the laws of the State of California.
(b) Authority of Developer. Developer has full power and authority to execute and deliver this Agreement and all other documents or instruments executed and delivered by Developer, or to be executed and delivered by Developer pursuant to or in connection with this Agreement, and to perform and observe the terms and provisions of all of the foregoing. (c) Authority of Persons Executing Documents. This Agreement and all other documents or instruments that have been or that will be executed and delivered by Developer pursuant to or in connection with this Agreement, have been or will be executed and delivered by persons who are duly authorized to execute and deliver the same for and on behalf of Developer, and all actions required under Developer’s organizational documents and applicable governing law for the authorization, execution, delivery and performance of this Agreement and all other documents or instruments that have been or that will be executed and delivered by Developer pursuant to or in connection with this Agreement, have been duly taken or will have been duly taken (to the extent such actions are required) as of the date of execution and delivery of such documents.
(d) Valid and Binding Agreements. This Agreement and all other documents or instruments that have been or that will be executed and delivered by Developer pursuant to or in connection with this Agreement constitute or, if not yet executed or delivered, will when so executed and delivered, constitute legal, valid and binding obligations of Developer, enforceable in accordance with their respective terms, subject to laws affecting creditors’ rights and principles of equity.
9 (e) No Breach of Law or Agreement. Neither the execution nor delivery of this Agreement or any other documents or instruments that have been or that will be executed and delivered by Developer pursuant to or in connection with this Agreement, nor the performance of any provision, condition, covenant or other term hereof or thereof, will conflict with or result in a breach of any statute, rule or regulation, or any judgment, decree or order of any court, board, commission or agency binding on Developer, or any provision of the organizational do cuments of Developer, or will conflict with or constitute a breach of or a default under any agreement to which Developer is a party, or will result in the creation or imposition of any lien upon any assets or property of Developer, other than liens established pursuant hereto. (f) Pending Proceedings. Except as disclosed in writing to the City prior to execution of this Agreement, Developer is not in default under or in violation of any law or regulation or under any order of any court, board, commission or agency whatsoever, and to the best knowledge of the Key Principals of Developer, there are no claims, actions, suits or proceedings pending or, to the best knowledge of the Key Principals of Developers, threatened against or affecting Developers, or the City Property, at law or in equity, before or by any court, board, commission or agency. Developer is not the subject of any bankruptcy or insolvency proceeding, and no general assignment or arrangement for the benefit of creditors or the appointment of a trustee or receiver to take possession of all or substantially all of Developer’s assets has been made.
2.1.2 City’s Representations. City covenants that until the first to occur of the expiration or earlier termination of this Agreement or the Close of Escrow for any particular Lot , upon learning of any fact or condition that would cause any of the warranties and representations in Section 2.1.2 to be untrue, City shall promptly give written notice of such fact or condition to Developer. City acknowledges that Developer shall rely upon City’s representations made herein notwithstanding any investigation made by or on behalf of Developer. City hereby represents, warrants, and covenants that the following are true and correct as of the Effective Date.
(a) Organization. City is a municipal corporation, duly organized under the laws of the State of California.
(b) Authority of City. City has full power and authority to execute and deliver this Agreement and all other documents or instruments executed and delivered by City, or to be executed and delivered by City pursuant to or in connection with this Agreement, and to perform and observe the terms and provisions of all of the foregoing.
(c) Authority of Persons Executing Documents. This Agreement, and all other documents or instruments that have been or that will be executed and delivered by City pursuant to or in connection with t his Agreement, have been or will be executed and delivered by persons who are duly authorized to execute and deliver the same for and on behalf of City, and all actions required under City’s governing documents and applicable governing law for the authorization, execution, delivery and performance of this Agreement and all other documents or instruments that have been or that will be executed and delivered by City pursuant to or in connection with this Agreement, have been duly taken or will have been duly taken (to the extent such actions are required) as of the date of execution and delivery of such documents.
(d) Valid and Binding Agreements. This Agreement and all other documents
10 or instruments that have been or that will be executed and delivered by City pursuant to or in connection with this Agreement constitute or, if not yet executed or delivered, will when so executed and delivered, constitute legal, valid and binding obligations of City, enforceable in accordance with their respective terms, subj ect to laws affecting creditors’ rights and principles of equity. Subject to the provisions and conditions of this Agreement, the City hereby agrees that the City is granting, and grants herewith, a fully vested entitlement and right to develop the City Property and the Downtown Project in accordance with the terms and conditions of this Agreement. The Owner’s vested right to proceed with the development of the City Property and Downtown Project is subject to an approval process as set forth in this Agree ment; provided that any conditions, terms, restrictions and requirements for such subsequent actions shall not prevent development of the City Property and the Downtown Project for the uses set forth in the Project Description, or reduce the intensity or d ensity of development, or limit the rate or timing of development set forth in this Agreement, unless so requested by the Owner and so long as the Owner is not in default under this Agreement.
(e) No Breach of Law or Agreement. Neither the execution nor delivery of this Agreement or any other documents or instruments that have been or that will be executed and delivered by City pursuant to or in connection with this Agreement, nor the performance of any provision, condition, covenant or other term hereof or thereof, will conflict with or result in a breach of any statute, rule or regulation, or any judgment, decree or order of any court, board, commission or agency binding on City, or any provision of the governing documents of City, or will conflict with or constitute a breach of or a default under any agreement to which City is a party, or will result in the creation or imposition of any lien upon any assets or property of City, other than liens established pursuant hereto.
(f) Pending Proceedings. Except as disclosed in writing to Developer prior to execution of this Agreement, neither City nor the Subject Property is in default under or in violation of any law or regulation or under any order of any court, board, commission or agency, and to the best knowledge of City, there are no claims, actions, suits or proceedings pending or, to the best knowledge of City, threatened in writing against or affecting City or the City Property, at law or in equity, before or by any court, board, commission or agency, in a ny such case where such default or violation or claim, action, suit or proceeding is reasonably likely to have a material adverse effect on the Subject Property or any portion thereof or the City’s ability to perform its obligations under this Agreement. City is not the subject of any bankruptcy or insolvency proceeding, and no general assignment or arrangement for the benefit of creditors or the appointment of a trustee or receiver to take possession of all or substantially all of City’s assets has been made.
(g) Condemnation. No condemnation proceedings relating to the Subject Property or its access to or from public streets or utilities are pending, nor has the City received written notice of any threatened condemnation proceedings relating to the foregoing.
(h) Other Agreements. Except as disclosed in writing to Developer, and except for matters of public record or matters shown as exceptions to title to the City Property in the Title Report City has not made any commitment or entered into any agreement of any kind with any governmental authority, or any adjoining property owner, group or other third party, which 11 would in any way be binding on Developer or all or any portion of the City Property after the Close of Escrow.
(i) Environmental. With the exception of those matters disclosed in that certain Covenant to Restrict Use of Property Environmental Restriction recorded in the Official Records of Santa Barbara County on or about March 23, 2016 as Instruments No. 2016-025567 and 2016-025568, City has no knowledge of any violation of Environmental Laws related to the Subject Property or the presence or release of Hazardous Material on or from the Property. To the best of City’s knowledge, neither the Property nor any portion thereof has been used for the generation, treatment, storage, handling or disposal of any Hazardous Material, in violation of any Environmental Laws, by the City or its predecessors-in-interest.
(j) No Tenants. There are no leases or occupancy agreements or licenses affecting the City Property or any portion thereof or conferring on any person or entity the right to use, occupy or enter onto the Subject Property except those existing in the chain of title.
(k) No Service Contracts . There are no service contracts or other agreements affecting the City Property or any portion thereof that will remain in effect after Close of Escrow except those existing in the chain of title.
(l) Property Information. To the best of City’s knowledge, the items of Property Information delivered to Developer are true and complete copies of such items and such items contain no material information actually known by City to be false.
2.2 Effective Date. The obligations of Developer and City hereunder shall be effective as of the Effective Date which date is set forth in the preamble to this Agreement.
2.3 Intentionally omitted.
2.4 Environmental Review; Design Review; Conditions of Approval. The City Council determined that the Project CEQA Documentation for Lot 3 has adequately considered the environmental effects of the Downtown Project, and that no further analysis of the Downtown Project is required under CEQA.
Any additional environmental studies required by the City in connection with environmental review of the Downtown Project in accordance with CEQA shall be completed at the Developer’s expense. Developer acknowledges that approval or disapproval of the Downtown Project following completion of any such additional required environmental review is within the sole and absolute discretion of the City without limitation by or consideration of the terms of this Agreement, and that the City makes no representation r egarding the ability or willingness of the City to approve a modified Downtown Project at the conclusion of any supplemental environmental review process required by CEQA, or regarding the imposition of any mitigation measures required as a result thereof. Prior to the Close of Escrow, Developer shall have the right to terminate this Agreement by delivery of written notice to City if the City disapproves the Downtown Project following completion of any required supplemental environmental review or Developer determines that implementation of any additional environmental mitigation measures required as a result of such supplemental review or new and additional Conditions of Approval imposed in connection
12 with such supplemental review would cause development o f the Downtown Project to become economically infeasible.
2.5 Financial Capacity. Developer has submitted to City sufficient information and data to establish the financial capacity of Developer to perform its obligations under this Agreement. To the extent that Developer intends to secure financing for the construction of the Downtown Project, Developer shall submit copies of all loan documents for the City’s approval, which shall not be unreasonably withheld, conditioned, or delayed.
ARTICLE III
DISPOSITION OF THE CITY PROPERTY; CONDITIONS
PRECEDENT TO CLOSING
3.1 Purchase and Sale of City Property; Review of Title. Developer acknowledges receipt of a preliminary title report for the City Property issued by First American Title Company on or about __________ and dated _________ for Lot 2. City shall provide to Developer a preliminary title report and an ALTA survey for the remaining lots within sixty (60) days of execution of this Agreement (collectively the “Title Report”). Provided that all conditions precedent set forth in this Agreement have been satisfied or waived, City shall sell to Developer, and Developer shall purchase from City, the fee interest in the City Property in accordance with and subject to the terms, covenants and conditions of this Agreement subject to: (a) the provisions and effects of the City Documents, (b) applicable building and zoning laws and regulations, (c) any lien for current taxes and assessments or taxes and assessments accruing subsequent to recordation of the Grant Deed and Reservation of Easement, (d) exceptions numbers 1 through 7 as shown on the Title Report, (e) liens and encumbrances created or permitted by Developer or Developer’s Affiliates, employees, or agents, and (f) such other conditions, liens, encumbrances, restrictions, easements and exceptions as Developer may approve in writing, which approval shall not be unreasonably withheld. All of the foregoing are collectively hereinafter referred to as “Developer’s Permitted Exceptions.” The City Property shall be conveyed by grant deed(s) substantially in the form s attached hereto as Exhibit G (the “Grant Deed”).
3.2 Purchase Price. City shall sell the City Property to Developer for the sum of :
$120,000 for Lot 1; $ 120,000 for Lot 2 ; $120,000 for Lot 3 after initial payments and refunds following completion of the projects in accordance with the construction schedule; $120,000 for Lot 4, if the option for its purchase is exercised (the “Purchase Price”) which is the agreed upon value, based upon the intent of the Buyer to provide a mixed use project in the Downtown Project.
The value is priced less than the appraised value in recognition of the requirements of this agreement.
3.3 Independent Consideration; Good Faith Deposit.
(a) Independent Consideration. In addition to the Good Faith Deposit, below, Developer shall deposit with the Escrow Agent, within three (3) business days after the Effective Date an initial earnest money deposit in the amount of One Hundred and 00/100 Dollars ($100.00) for each of the Lots (“Independent Consideration ”). The Independent Consideration is non - 13 refundable to Developer under any circumstances as independent consideration for the rights extended to Developer under this Agreement. The Independent Consideration shall be released to City immediately following Developer deposit of this Agreement into Escrow. The Independent Consideration shall not be applicable towards the Purchase Price.
(b) Good Faith Deposit
(i) As of the Effective date of this Agreement, the Developer has delivered to the City the Good Faith Deposit, consisting of the sum of Ten Thousand and 00/100 Dollars ($10,000.00) in cash. The City shall promptly deposit the Good Faith Deposit in a short - term interest -bearing account, such as the Local Agency Investment Fund or another fund or account in which the City typically invests funds on a short-term basis.
(ii) The Developer may elect not to proceed with construction of the Downtown Project. In such event, or in the event of termination of the Agreement, the Good Faith Deposit will be handled pursuant to Section 9 below. If this Agreement is terminated as a result of an Event of Default by Developer, the City shall retain the Good Faith Deposit. If this Agreement is terminated as a result of an Event of Default by the City, the Good Faith Deposit shall be returned to Developer.
(c) When the Closing occurs, the Good Faith Deposit shall be applied against the Purchase Price due the City from the Developer for the particular Lot that is closing. Within thirty (30) days of the closing of a particular Lot, Developer shall deposit with the City an additional Ten Thousand Dollars ($10,000) to serve as the Good Faith Deposit for the sale of the next particular Lot to Developer. This practice shall continue until all of the City Property has been sold t o Developer.
3.4 Escrow. City and Developer shall open escrow at the office of First American Title Company, located at 3780 State Street , Santa Barbara, CA 93105 , or such other title company as the Parties may agree upon (“ Escrow Agent” or “Title Company”) in order to consummate the conveyance of each of the Lots of the City Property to Developer and the closing of escrow for the transactions contemplated hereby.
3.5 Costs of Closing and Escrow; Legal Fees. Developer shall pay all title insurance premiums for policies Developer elects to purchase in connection with the acquisition of the City Property and the financing of the Project, and Developer shall pay all recording fees, transfer taxes, escrow fees and closing costs incurred in connection with the acquisition of the City Property and the financing of the Downtown Project. Property taxes and assessments shall be prorated as of the Closing Date. City and Developer shall provide Escrow Agent with a cop y of this Agreement, which together with such supplemental instructions as City or Developer may provide and which are consistent with the intent of this Agreement or which are otherwise mutually agreed upon by City and Developer, shall serve as escrow ins tructions for the Close of Escrow. By not later than the Close of Escrow, Developer shall pay City’s reasonable consulting fees incurred in connection with the transactions contemplated by this Agreement.
14 3.6 Closing. The Closing Dates for Developer’s acquisition of each of the Lots of City Property shall be a date(s) that is/are mutually acceptable to the Parties, which shall occur no later than (a) one-hundred-eighty (180) days following the Parties’ satisfaction or waiver of all conditions precedent to conveyance of each of the respective Lots of the City Property as set forth in Sections
3.9 and 3.10, or (b) fifteen (15) days after issuance of building permits for that particular Lot. Prior to the Close of Escrow and provided all conditions precedent to Close of Escrow have been satisfied or waived, Developer shall deposit into escrow the City Documents, executed and acknowledged as applicable, and full payment of closing costs for that particular Lot. Provided that all conditions precedent to Close o f Escrow have been satisfied or waived, City shall deposit into escrow the executed Grant Deed and executed copies of the City Documents for that particular Lot . On the Closing Date, the Escrow Agent shall cause the Grant Deed for that particular Lot and the Memorandum for such to be recorded in the Official Records.
3.7 Tax Free Exchange. If Developer notifies City prior to the Close of Escrow that Developer intends to effectuate a “tax -free” exchange pursuant to Section 1031 of the Internal Revenue Code in connection with the transaction s contemplated in this Agreement, City will cooperate with Developer, at no cost, expense, or liability to City, in Developer’s attempt to effectuate such exchange, but City makes no representations to Developer that any such exchange shall be treated as “tax-free” by the Internal Revenue Service. Developer agrees to indemnify City from all liability with respect to any action which Developer requests City to take pursuant to this Section, and to reimburse City for all fe es, costs, and expenses (including reasonable attorneys’ fees) incurred by City as a result of Developer’s election to participate in a Section 1031 exchange.
City shall not be required to hold title to any real estate or other assets in order to cooperat e with Developer’s Section 1031 exchange.
3.8 Delivery of Disclosures/Property Information . City represents and warrants that it has disclosed to Developer all material information that impacts on the value or desirability of the City Property, and has del ivered to Developer the following items relating to the City Property (collectively, “Property Information”), to the extent within City’s possession, custody, or control (but excluding any items that are protected from disclosure by the attorney -client pri vilege, or otherwise statutorily protected ): (a) any environmental reports and a schedule listing any such reports; (b) all existing and currently effective plans, specifications, permits, approvals maps and surveys (including, without limitation, archaeological, boundary, topographic and tree surveys); (c) any soils and engineering reports; (d) all currently effective agreements with any governmental authority with respect to any zoning modification, variance, exception, platting or other matter relating to the zoning, use, development, subdivision or platting of the City Property; (e) copies of all agreements, studies, reports, correspondence and other documents relating to the presence or absence of any endangered species or environmentally sensitive areas on the City Property; and (f) any leases, contracts or agreements relating to the City Property or services being provided or to be provided to the City Property, including, without limitation, any agreements with electric, cable, gas, telephone or other utility providers. City shall provide to Developer any documents described above and coming into City’s possession, custody, or control, or generated by City after the initial delivery above and prior to the Close of Escrow.
3.9 City’s Conditions to Closing. City’s obligations to convey each of the Lots of City Property to Developer is conditioned upon the satisfaction of the terms and conditions set forth in 15 this Section 3.9 prior to the conveyance of that particular Lot, unless any such condition is waived in writing by the City acting in the discretion of its Authorized Representative.
(a) No Default . There shall exist no condition, event or act which would constitute a material breach or default under this Agreement or any other City Document, or which, upon the giving of notice or the passage of time, or both, would constitute such a material breach or default.
(b) Representations. All representations and warranties of Developer contained herein or in any other City Document or certificate delivered in connection with the transactions contemplated by this Agreement shall be true and correct in all material respects as of the Close of Escrow for that particular Lot.
(c) Due Authorization and Good Standing. Developer shall have delivered to City copies of all of the following, including updated versions of any of the following that have been amended or modified since the date of any prior delivery to City: (i) certificates of good standing, certified by the California Secretary of State, indicating that Developer is properly organized and in good standing under the laws of California; and (ii) certified copies of Developer’s articles of incorporation; (iii) copies of Developer’s bylaws, if any, certified by an authorized officer of each entity as accurate, complete, and in full force and effect; and (iv) resolutions adopted by Developer’s Board of Direct ors, certified by an authorized officer of each entity, authorizing the execution of, and performance under, this Agreement and the other City Documents.
(d) Execution, Delivery and Recordation of Documents. Developer shall have executed, acknowledged as a pplicable, and delivered to City this Agreement, and all other documents required in connection with the transactions contemplated hereby, including without limitation, a Memorandum of Option substantially in the form attached hereto as Exhibit C (the “Memorandum”), and a counter -signed original of the Grant Deed for that particular Lot .
Concurrently with the Close of Escrow for each Lot, the Grant Deed, and the Memorandum for that particular Lot shall be recorded in the Official Records.
(e) Approval of Financing Documents; Evidence of Availability of Funds. City shall have approved the loan documents for all financing sources for the Downtown Project, if any.
At such time as Developer secures construction financing for phase of the Downtown Project, Developer shall provide evidence reasonably satisfactory to City that (i) all conditions to the release and expenditure of the initial draw of funds from each construction financing source for that particular phase of the Downtown Project have been met and that such funds will be available, and (ii) all construction financing (including draws subsequent to the initial draw of funds) will be available upon the satisfaction of the conditions set forth in the applicable documents.
(f) Construction Contract, Plans, Budget and Schedule. City shall have approved the general contractor, the construction budget and schedule, and the construction contract for each phase of the Downtown Project, and City shall have approved the final Construction Plans and specifications for each phase of the Downtown Project. Developer shall have delivered an
16 executed copy of the construction contract for each phase of the Downtown Project to the City. If City has not provided written objections to Developer regarding the general contractor, the construction budget and schedule, or the construction contract for th at particular phase of the Downtown Project within fifteen (15) business days following their submittal to the City, such items shall be deemed to have been approved.
(g) Land Use Approvals. Developer shall have delivered evidence satisfactory to City that Developer has obtained all land use approvals required to construct each particular phase of the Downtown Project. Other than terms set forth in Exhibits A-3, A-6, A-9, B-1, B -2, and B -3, Developer agrees to conform to all required residential development requirements, including those for affordable housing units. Developer shall be permitted to offset development requirements for the Property by providing such on its a djacent projects in the Downtown Project. For example, Developer, in its sole discretion, may provide required parking and/or affordable units for this Project on any of its neighboring developments in the Downtown Project which are covered by this Agreem ent, in addition to those require for any such project in order to satisfy the requirements for development of each particular Lot . Developer has commenced seeking land use approvals for the Downtown Project prior to the execution of this Agreement. City hereby ratifies any and all approvals previously conferred by any City agency to Developer for the Downtown Project that predate this Agreement. (h) Payment of Fees. Developer shall have paid when due all fees and charges in connection with the processing of all applicable City permits and approvals for that particular phase of the Downtown Project , and Developer shall have paid City’s escrow fees pursuant to Section 3.4 associated with such phase . The City and Developer will negotiate in good faith regarding incentives to be credited out of the fees paid, following the submission by the Developer of the final proposed commercial spaces, including proposed tenants. The maximum gross amount of fees, prior to the issuance of any incentive credits for each pha se of the Pro ject will be the remaining amount after fee discounts as described in Exhibits B-1, B-2, and B-3.
(i) Insurance; Payment and Performance Bonds. Developer shall have provided evidence satisfactory to City that Developer has obtained insurance coverage meeting the requirements set forth in Article X for that particular phase of the Downtown Project. If Developer obtains payment and performance bonds in connection with construction of the Project, City shall be named as co-obligee thereunder in which event Developer shall provide City with copies of such bonds promptly after the same are obtained.
(j) Mechanics’ Liens . Developer shall have provided evidence reasonably satisfactory to City that there are no mechanics’ liens or stop notices related to the City Property or the Downtown Project as a result of activities of Developer or its employees, contractors, or agents, and Developer’s provision of full waivers or releases of lien claims if required by City.
(k) Other Documents. Developer’s delivery to City, and City approval of such other documents related to the development and financing of each phase of the Downtown Project as City may reasonably request.
17 (l) Deposit of Funds. Developer shall have deposited into escrow the Purchase Price and funds in the amount of all other costs and expenses required to be paid by Developer through escrow for the purchase of each particular Lot. (m) Settlement Statement . City shall have approved the final settlement statement for the Close of Escrow.
3.10 Developer’s Conditions to Closing. Developer’s obligation to proceed with the acquisition of each Lot of the City Property is subject to the satisfaction or Developer’s waiver of the conditions stated in this Section 3.10 for each particular Lot , unless any such condition is waived in writing by Developer:
(a) No Default. City shall not be in default under the terms of this Agreement, and all representations and warranties of City contained herein shall be true and correct in all material respects;
(b) Due Authorization and Good Standing . City shall have delivered to Developer resolutions or other evidence certified by an authorized officer or agent of City authorizing City’s execution of and performance under this Agreement and the other City Documents.
(c) Execution of Documents. City shall have executed and acknowledged the Grant Deed and the Memorandum, and all other City Documents to which the City is a party, and shall have delivered such documents into escrow;
(d) Parcel Map Approval . City shall have approved a Parcel Map, lot line adjustment, or other action as may be necessary to convey each particular Lot of the City Property to Developer.
(e) Title Policies. The Title Company shall have committed, upon payment of the premium ther efor, to issue an such Title Insurance Policies for the benefit and protection of Developer (“Owner’s Title Policy”) and/or Developer’s Lender, if any (“Lender’s Title Policy”) showing title to each particular Lot of the City Property vested in Developer, subject only to Developer’s Permitted Exceptions and containing such endorsements as Developer may reasonably require, with the cost of such Owner’s Title Policy to be paid by Developer.
(f) Mechanics’ Liens. City shall have provided evidence reasonably satisfactory to Developer and/or the Title Company that no mechanics’ liens or stop notices have been served and/or recorded relating to the City Property or the Downtown Project as a result of activities of City or its employees, contractors, or agents, and Developer’s provision of full waivers or releases of lien claims if reasonably required by Developer and/or Title Company (or, in the alternative, verification that no construction activities have been performed on the City Property within the sixty (60) days prior to Closing).
(g) Land Use Approvals. Developer shall have obtained the Entitlements and all other land use approvals required to construct the portions of the Project on the particular Lot of the City Property, subject only to such conditions a s are reasonably acceptable to Developer, and all
18 such approvals shall have been given by all required actions conducted in accordance with all applicable laws, ordinances, statutes, rules and regulations, and all appeal periods or periods within which such approvals can be challenged shall have expired without any appeal or challenge having been filed or any appeal or challenge (“Final Approval Date”).
(h) Settlement Statement. Developer shall have approved the final settlement statement for the Close of Escrow.
ARTICLE IV
[Intentionally omitted]
ARTICLE V
DEVELOPMENT AND USE OF THE CITY PROPERTY AND
DOWNTOWN PROJECT
5.1 Development Schedule.
(a) Subject to Force Majeure, Developer shall commence construction of each phase of the Downtown Project no later than the Commencement Date for each Lot and shall diligently prosecute to completion the construction of each phase of the Downtown Project to enable City to issue certificates of occupancy or equivalents for the each phase of the Downtown Project within thirty-six (36) months following the Commencement Date for each phase , except as such date may be extended by written agreement of the Parties (“Completion Date”). No extension may be granted without additional consideration being paid by Developer. Developer shall use diligent and commercially reasonable efforts to perform Developer’s obligations under this Agreement within the times periods set forth herein, and if no such time is provided, within a reasonable time, designed to permit issuance of final certificates of occupancy for each phase of the Project by the date specified in this Section 5.1. Subject to Force Majeure, Developer’s failure to commence or complete construction of each phase of the Downtown Project in accordance with the time periods specified in this Section 5.1 shall be an Event of Developer Default hereunder.
(b) Notwithstanding anything to the contrary herein, Developer’s shall have no obligation to develop that portion of the Subject Property other than the Project Site. (c) Upon Developer's timely completion of construction of Lot 1, Lot 2 and Lot 3, and so long as that completion has occurred within six (6) years of execution of this Agreement, Developer shall be granted the option to purchase Lot 4 from the City for $120,000 on the same terms and conditions as the purchase of the other City Lots as set forth herein.
5.2 Tolling and Extension During Legal Challenge or Moratoria. In the event this Agreement, any of the land use entitlements related to the Downtown Project, or any subsequent 19 approvals or permits required to implement the land use entitlements for the Downtown Project or this Agreement are subjected to legal challenge and the Develope r is unable to proceed with development of the Downtown Project due to such legal challenge (or the Owner provides written notice to the City that it is electing not to proceed with development of the Downtown Project until such legal challenge is resolved to the Owner’s satisfaction), the Term of this Agreement and timing for obligations imposed by this Agreement shall be extended and tolled during such legal challenge until the entry of a final order or judgment upholding this Agreement, or the land use e ntitlements, approvals, or permits related to this Agreement, or the litigation is dismissed by stipulation of the parties; provided, however, that notwithstanding the foregoing, the Developer shall have the right to elect, in the Developer’s sole and abso lute discretion and risk, to proceed with development of each phase of the Downtown Project at any point by providing the City written notice that it is electing to proceed, in which event the tolling of the Term of this Agreement shall cease as of the date of such notice. Similarly, if the Developer is unable to develop any phase of the Downtown Project due to the imposition by the City or other public agency of a development moratoria for a public health and safety reason unrelated to the performance of the Developer ’s obligations under this Agreement (including without limitation, moratoria imposed due to the unavailability of water or sewer to serve the City Property), then the Term of this Agreement and the timing for obligations imposed pursuant to this Agreement shall be extended and tolled for the period of time that such moratoria prevents development of the City Property.
5.3 Cost of Acquisition and Construction. Developer shall be solely responsible for all direct and indirect costs and expenses incurred in connection with the acquisition of the City Property, including without limitation appraisal fees, title reports and any environmental assessments Developer elects to undertake. All costs of designing, developing and constructing the Downtown Project and compliance with the Conditions of Approval, including without limitation all offsite and on-site improvements required by City in connection therewith, shall be borne solely by Developer and shall not be an obligation of the City.
5.4 Permits and Approvals; Payment of Fees; Cooperation. Developer acknowledges that the execution of this Agreement by the City does not constitute City approval for the purpose of the issuance of building permits, does not limit in any manner the d iscretion of City in such approval process, and does not relieve Developer from the obligation to apply for and to obtain from the City and all other agencies with jurisdiction over the Downtown Project, all necessary approvals, entitlements, and permits for the development of the Downtown Project and the construction of the Downtown Project (including without limitation, the approval of architectural plans, the issuance of any certificates regarding historic resources required in connection with the develo pment of the Downtown Project (if any), and the approval of the Downtown Project in compliance with CEQA and if applicable, NEPA), nor does it limit in any manner the discretion of the City or any other agency in the approval process. Prior to the Close o f Escrow on each Lot of the City Property, Developer shall have obtained all entitlements, permits, licenses and approvals required for the construction of that particular Lot, or shall provide evidence satisfactory to City that receipt of such permits and approvals is subject only to such conditions as City may reasonably approve. Developer shall pay when due all customary and usual fees and charges in connection with the processing of all applicable permits and approvals. Developer shall not commence co nstruction work on that particular phase of the Downtown Project prior to issuance of building permits required for such work. City staff shall work cooperatively with Developer to assist in coordinating the expeditious
20 processing and consideration of all permits, entitlements and approvals necessary for the development and operation of the Project as contemplated by this Agreement.
5.5 Conditions of Approval. Developer shall develop the Downtown Project in accordance with the terms and conditions of this Agreement, including the Exhibit requirementsand in compliance with the terms and conditions of all approvals, entitlements and permits that the City or any other governmental body or agency with jurisdiction over the Downtown Project or the City Property has granted or issued as of the date hereof or may hereafter grant or issue in connection with development of the Downtown Project, including without limitation, all mitigation measures imposed in connection with environmental review of the Downtown Project and all conditions of approval imposed in connection with any entitlements, approvals or permits (all of the foregoing approvals, entitlements, permits, mitigation measures and conditions of approval are hereafter collectively referred to as the “Conditions of Approval”).
5.6 Fees. Developer shall be solely responsible for, and shall promptly pay when due, all customary and usual fees and charges of City and all other agencies with jurisdiction over development of the Downtown Project in connection with obtaining building permits and other approvals for the Downtown Project, including without limitation, those related to the processing and consideration of amendments, if any, to the current entitlements, any related approvals and permits, environmental review, architectural review, historic review, and any subsequent approvals for the Downtown Project. The City shall grant Developer a fee reduction of 50% of all such plan check fees.
5.7 Construction Plans. Developer shall submit to City’s Building Division detailed construction plans meeting or exceeding the requirements of the Exhibits for each phase of the Downtown Project (the “ Construction Plans”). As used herein “ Construction Plans” means all construction documents upon which Developer and Developer’s contractors shall rely in developing each phase of the Downtown Project (including the landscaping, parking, and common areas) and shall include, without limitation, the site development plan, final archi tectural drawings, landscaping, exterior lighting and signage plans and specifications, materials specifications, final elevations, and building plans and specifications. The Construction Plans shall be based upon the scope of development set forth herein and upon the approvals issued by the City for each phase of the Downtown Project and shall not materially deviate therefrom without the express written consent of City.
5.8 Construction Pursuant to Plans. Developer shall develop each component and phase of the Downtown Project in accordance with the approved Construction Plans, the Conditions of Approval, and all other permits and approvals granted by the City pertaining to each phase of the Downtown Project. Developer shall comply with all directions, r ules and regulations of any fire marshal, health officer, building inspector or other officer of every governmental agency having jurisdiction over the properties that are encompassed in the Downtown Project. Each element of the work shall proceed only af ter procurement of each permit, license or other authorization that may be required for such element by any governmental agency having jurisdiction. All design and construction work on the Downtown Project shall be performed by licensed contractors, engin eers or architects, as applicable.
21 5.9 Change in Construction Plans. If Developer desires to make any material change in the approved Construction Plans, Developer shall submit the proposed change in writing to the City Community Development Director for the City's written approval, which approval shall not be unreasonably withheld, conditioned, or delayed if the Construction Plans, as modified by any proposed change, substantially conform to the requirements of this Agreement and any approvals issued by th e City after the Effective Date. Unless a proposed change is rejected by City within sixty (60) days, it shall be deemed approved. If rejected, the previously approved Construction Plans shall continue to remain in full force and effect. Any change in the Construction Plans required in order to comply with applicable codes shall be deemed approved, so long as such change does not substantially nor materially change the architecture, design, function, use, or amenities of the Project as shown on the latest approved Construction Plans. Nothing in this Section is intended to or shall be deemed to modify the City’s standard plan review procedures.
5.10 Intentionally omitted.
5.11 City Disclaimer. Developer acknowledges that the City is under no obligation, and the City neither undertakes nor assumes any responsibility or duty to Developer or to any third party, to in any manner review, supervise, or inspect the progress of construction or the operation of the Downtown Project. Developer and all third parties shall rely entirely upon its or their own supervision and inspection in determining the quality and suitability of the materials and work, the performance of architects, subcontractors, and material suppliers, and all other matters relating to the construction and operation of the Downtown Project. Any review or inspection undertaken by the City is sole ly for the purpose of determining whether Developer is properly discharging its obligations under this Agreement and shall not be relied upon by Developer or any third party as a warranty or representation by the City as to the quality of the design or con struction of the Project or otherwise.
5.12 Defects in Plans. The City shall not be responsible to Developer or to any third party for any defect in the Construction Plans or for any structural or other defect in any work done pursuant to the Construction Pla ns. To the greatest extent permitted by law, Developer shall indemnify, defend (with counsel approved by City) and hold harmless the City and its elected and appointed officers, officials, employees, agents, consultants, and contractors (all of the forego ing, collectively, the “Indemnitees”) from and against all liability, loss, cost, expense (including without limitation attorneys’ fees and costs of litigation), claim, demand, action, suit, judicial or administrative proceeding, penalty, deficiency, fine, order, and damage (all of the foregoing collectively “Claims”) arising out of, or relating to, or alleged to arise from or relate to defects in the Construction Plans or defects in any work done pursuant to the Construction Plans whether or not any insura nce policies shall have been determined to be applicable to any such Claims.
Developer’s indemnification obligations set forth in this Section shall survive the expiration or earlier termination of this Agreement and the recordation of each Certificate of Completion.
Developer’s indemnification obligations pursuant to this Section shall not extend to Claims to the extent arising from the gross negligence or willful misconduct of the Indemnitees and are subject to the additional terms set forth in Section 10.2 below.
5.13 Certificate of Completion for Project. Promptly after completion of each phase of construction of the Downtown Project, and City’s issuance of a final Certificate of Occupancy for that phase, the City will provide a certificate substantiall y in the form attached hereto as Exhibit E (“Certificate of Completion”) so certifying, provided that at the time such certificate is requested
22 all applicable work has been completed for that phase of the Downtown Project. The Certificate of Completion shall be conclusive evidence that Developer has satisfied its obligations regarding the development of that phase of the Downtown Project. At Developer’s option, each Certificate of Completion shall be recorded in the Official Records. The Certificate of C ompletion shall not constitute evidence of compliance with or satisfaction of any obligation of Developer to any holder of a deed of trust or mortgage securing money loaned to finance any phase of construction of the Downtown Project or any part thereof an d shall not be deemed a notice of completion of construction under the California Civil Code, nor shall such Certificate provide evidence that Developer has satisfied any obligation that survives the expiration of this Agreement.
5.14 Equal Opportunity. There shall be no discrimination on the basis of race, color, religion, creed, sex, sexual orientation, marital status, ancestry or national origin in the hiring, firing, promoting or demoting of any person engaged in construction work on the Downtown Project, and Developer shall direct its contractors and subcontractors to refrain from discrimination on such basis.
5.15 Prevailing Wage Requirements. If required by applicable federal and state law, Developer and its contractors, subcontractors and agents shall comply with the California Labor Code Section 1720 et seq. and the regulations adopted pursuant thereto (and if applicable, the federal Davis Bacon Act and implementing regulations) (all of the foregoing, collectively, “ Prevailing Wage Laws”), and shall be responsible for carrying out the requirements of such provisions. If applicable, Developer shall submit to City a plan for monitoring paymen t of prevailing wages and at Developer’s expense shall implement such plan and comply with all applicable reporting and recordkeeping requirements.
To the greatest extent permitted by law, Developer shall indemnify, defend (with counsel approved by City) and hold the Indemnitees harmless from and against all Claims that directly or indirectly, in whole or in part, are caused by, arise in connection with, result from, relate to, or are alleged to be caused by, arise in connection with, or relate to, the pa yment or requirement of payment of prevailing wages (including without limitation, all claims that may be made by contractors, subcontractors or other third party claimants pursuant to Labor Code Sections 1726 and 1781) or the requirement of competitive bi dding in connection with the Downtown Project, the failure to comply with any state or federal labor laws, regulations or standards in connection with this Agreement, including but not limited to the Prevailing Wage Laws, or any act or omission of Developer related to this Agreement with respect to the payment or requirement of payment of prevailing wages or the requirement of competitive bidding, whether or not any insurance policies shall have been determined to be applicable to any such Claims. The provisions of this Section 5.14 shall survive the expiration or earlier termination of this Agreement and the issuance of a Certificate of Completion for the Project. Developer’s indemnification obligations set forth in this Section shall not apply to Claims to the extent arising from the gross negligence or willful misconduct of the Indemnitees and are subject to the additional terms set forth in Section 10.2 below.
5.16 Compliance with Laws. Developer shall carry out and shall cause its contractors and subcontractors to carry out the construction of the Downtown Project in conformity with all applicable federal, state and local laws, rules, ordinances and regulations (“ Applicable Laws ”), including without limitation, all applicable Environmental Laws, all applicable federal and state labor laws and standards, applicable provisions of the California Public Contracts Code, the City’s 23 zoning and development standards, building, plumbing, mechani cal and electrical codes, all other provisions of the City’s Municipal Code, and all applicable disabled and handicapped access requirements, including without limitation, the Americans with Disabilities Act, 42 U.S.C. Section 12101, et seq., Government Code Section 4450, et seq., Government Code Section 11135, et seq., and the Unruh Civil Rights Act, Civil Code Section 51, et seq. To the greatest extent permitted by law, Developer shall indemnify, defend (with counsel approved by City) and hold harmless th e Indemnitees from and against any and all Claims arising in connection with the breach of Developer’s obligations set forth in this Section whether or not any insurance policies shall have been determined to be applicable to any such Claims. Developer’s indemnification obligations set forth in this Section shall not apply to Claims to the extent arising from the gross negligence or willful misconduct of the Indemnitees. Developer’s defense and indemnification obligations set forth in this Section 5.15 shall survive the expiration or earlier termination of this Agreement and the issuance of a Certificate of Completion for the Downtown Project and shall be subject to the additional terms set forth in Section 10.2 below.
5.17 Liens and Stop Notices. Until a Certificate of Completion has been issued for that particular phase of construction, and subject to Developer’s ability to dispute payment applications submitted by contractors, as permitted by California Civil Code sections 8800 and 8812, Developer shall not allow to be placed on th at particular Lot of the City Property or any part thereof any lien or stop notice on account of materials supplied to or labor performed on behalf of Developer. If a claim of a lien or stop notice is given or recorded affectin g the City Property or any part thereof prior to conveyance of such to Developer, Developer shall within twenty (20) days of such recording or service: (a) pay and discharge (or cause to be paid and discharged) the same; or (b) effect the release thereof by recording and delivering (or causing to be recorded and delivered) to the party entitled thereto a surety bond in sufficient form and amount; (c) provide other assurance satisfactory to City that the claim of lien or stop notice will be paid or discharged or take such other or additional action as the parties may agree in writing
5.18 Right of City to Satisfy Liens on the Property; Notice of Completion. Until a Certificate of Completion has been issued for that particular Lot , if Developer fails to satisfy o r discharge any lien or stop notice on that particular Lot of City Property or any part thereof pursuant to and within the time period set forth in Section 5.16 above, the City shall have the right, but not the obligation, to satisfy any such liens or sto p notices at Developer’s expense and without further notice to Developer and all sums advanced by City for such purpose shall be an indebtedness owed by Developer to City. In such event Developer shall be liable for and shall immediately reimburse City for such paid lien or stop notice. Alternatively, the City may require Developer to immediately deposit with City the amount necessary to satisfy such lien or claim pending resolution thereof. The City may use such deposit to satisfy any claim or lien that is adversely determined against Developer. Nothing contained in this Section 5.17 shall prevent Developer from challenging or contesting the validity of such liens and/or stop notices.
Developer shall file a valid notice of cessation or notice of completion upon cessation of construction work on each Lot of the City Property for a continuous period of thirty (30) days or more and shall take all other reasonable steps to forestall the assertion of claims or liens against the City Property. The City may (but has no obligation to) record any notices of completion or cessation of labor, or any other notice that the City deems necessary or desirable to protect its interest in the City Property.
24 5.19 Insurance Requirements. Until such time as Developer’s const ruction obligations under this Agreement are satisfied, Developer shall maintain and shall cause its contractors to maintain all applicable insurance coverage specified in Article X.
5.20 Quarterly Performance Reporting . During construction of each phase of the Downtown Project, Developer shall submit to City a quarterly performance report within 30 days of the end of each quarter. The report shall be in the form of a narrative description of all activities performed in relation to the Downtown Project including all development activities. The report shall include a Downtown Project timeline for that particular phase , including a schedule for completing milestones and/or tasks, and indicate the status of th at phase of the Downtown Project in relation to this timeline. Developer shall provide the quarterly reports described in this Section until construction of the Downtown Project is complete.
5.21 Maintenance. Commencing upon Developer’s acquisition of each Lot of the City Property, Developer shall at its own expense, maintain th at particular Lot of the City Property and the Improvements, including the landscaping and common areas, in good physical condition, in good repair, and in decent, safe, sanitary, habitable and tenantable liv ing conditions in conformity with all Applicable Laws. Without limiting the foregoing, Developer agrees to maintain each Lot of the City Property and the Improvements (including without limitation, landscaping, driveways, parking areas, and walkways) after its acquisition of such in a condition free of all waste, nuisance, debris, unmaintained landscaping, graffiti, disrepair, abandoned vehicles/appliances, and illegal activity, and shall take all reasonable steps to prevent the same from occurring on that particular Lot of the City Property . Developer shall prevent and/or rectify any physical deterioration of the Improvements and shall make all repairs, renewals and replacements as may be reasonably necessary to keep that particular Lot of City Property and the Improvements in good condition and repair. Developer shall also agree to enter into a landscape maintenance district, property and business improvement district, or some other mechanism to collect the funds necessary to sufficiently perform maintenance work.
5.22 Taxes and Assessments. Commencing upon Developer’s acquisition of each Lot of the City Property, Developer shall pay all real and personal property taxes, and other taxes assessed against that particular Lot of the City Property and/or the Improvements, at such times and in such manner as to prevent any lien or charge from attaching to that particular Lot of the City Property or Improvements; provided, however, Developer shall have the right to contest in good faith, any such taxes, assessments, or charges. In the event the Developer exercises its right to contest any tax, assessment, or charge, the Developer, on final determination of the proceeding or contest, shall immediately pay or discharge any decision or judgment rendered against it, together with all costs, charges and interest.
5.23 Designation as Point of Sale. Developer and its successors and assigns shall maintain such licenses and permits as may be required by any governmental agency to conduct taxable sales arising from any project on the City Property and, to the extent permitted by law, shall designate City as the “point of sale” for all taxable sales and lease transactions occurring from any project on the City Property in all reports to the California State Board of Equalization in accordance with the Bradley-Burns Uniform Sales and Use Tax Law (Revenue and Taxation Code 72000 et seq.), as it may be amended or substituted from time to time, and on sales tax returns to the State of California for all taxable sales occurring at any project on the City Property. 25 ARTICLE VI
CONDITION OF THE SITE; ENVIRONMENTAL MATTERS
6.1 Access to Site; Inspections. Prior to the Close of Escrow on each particular Lot , Developer and Developer’s authorized representatives may enter upon and conduct reviews and assessments of the physical and environmental condition of that particular Lot and the condition of the existing improvements. City may require Developer to execute a commercially reasonable right of entry agreement satisfactory to City prior to entry onto the City Property for such purpose and shall require Developer to provide proof of liability insurance acceptable to City.
Developer’s inspection, examination, survey and review of the City Property shall be at Developer’s sole expense. Developer shall provide City with copies of all third -party reports and test results promptly following completion of such reports and testin g. Developer hereby agrees to notify the City twenty-four (24) hours in advance of its intention to enter the City Property and will provide workplans, drawings, and descriptions of any intrusive sampling it intends to do. Developer must keep the City Property in a safe condition during its entry. Developer shall substantially repair, restore and return the City Property to its condition immediately preceding Developer’s entry thereon at Developer’s sole expense. Developer will not permit any mechanics l iens, stop notices or other liens or encumbrances to be placed against any of the Lots prior to Close of Escrow on that particular Lot, in connection with its site access and/or inspections as provided by this Section 6.1.
Without limiting any other indemnity provisions set forth in this Agreement, to the greatest extent permitted by law, Developer shall indemnify, defend (with counsel approved by City) and hold the Indemnitees harmless from and against all Claims resulting from or arising in connection with entry upon the City Property by Developer or Developer’s agents, employees, consultants, contractors or subcontractors pursuant to this Section 6.1 except to the extent arising from the gross negligence or willful misconduct of the Indemnitees. Develop er’s indemnification obligations set forth in this Section 6.1 shall survive the Close of Escrow and the termination of this Agreement and shall be subject to the additional terms and conditions set forth in Section 10.2 below.
6.2 Environmental Disclosure. To the extent the City has possession, custody or control of investigative reports concerning the City Property, it will provide copies to Developer; but the Parties acknowledge that City will not be conducting a public records search of any regulatory agency files —although the City urges Developer to do so to satisfy itself regarding the environmental condition of the City Property. By execution of this Agreement, Developer: (i) acknowledges its receipt of the foregoing notice respecting the environmental condition of the City Property; (ii) acknowledges that it will have an opportunity to conduct its own independent review and investigation of the City Property prior to the Close of Escrow; and (iii) agrees to rely solely on its own experts in assessing the environmental condition of the City Property and its sufficiency for its intended use.
6.3 Property Sold and Conveyed “AS IS.” Developer specifically acknowledges that the City is selling and Developer is purchasing the City Property on an “AS IS”, “WHERE IS” and “WITH ALL FAULTS” basis and that Developer is not relying on any representations or warranties of any kind whatsoever, express or implied, from City, its employees, board members, agents, or brokers as to any matters concerning the City Property. The City makes no representations or warranties as to any matters concerning the City Property, including without limitation: (i) the
26 quality, nature, adequacy and physical condition of the City Property or the improvements (if any) located thereon , including, but not limited to, the structural elements, foundation, roof, appurtenances, access, landscaping, parking facilities, and the electrical, mechanical, HVAC, plumbing, sewage, and utility systems, facilities and appliances, (ii) the quality, na ture, adequacy, and physical condition of soils, geology and any groundwater, (iii) the existence, quality, nature, adequacy and physical condition of utilities serving the City Property, (iv) the development potential of the City Property , and the use, ha bitability, merchantability, or fitness, suitability, value or adequacy of the City Property for any particular purpose, (v) the zoning or other legal status of the City Property or any other public or private restrictions on use of the City Property , (vi) the compliance of the City Property or its operation with any Environmental Laws, covenants, conditions and restrictions of any governmental or quasi-governmental entity or of any other person or entity, (vii) the presence or removal of Hazardous Material , substances or wastes on, under or about the City Property or the adjoining or neighboring property; (viii) the quality of any labor and materials used in any improvements on the City Property, (ix) the condition of title to the City Property, (x) the leases, service contracts, or other agreements (if any) affecting the City Property, or (xi) the economics of the operation of the City Property.
6.4 Developer to Rely on Own Experts. Developer understands that notwithstanding the delivery by Ci ty to Developer of any materials, including, without limitation, third party reports, Developer will rely entirely on Developer’s own experts and consultants and its own independent investigation in proceeding with the acquisition of the City Property.
6.5 Release by Developer. Effective upon the Close of Escrow for the final Lot of the City Property , Developer WAIVES, RELEASES, REMISES, ACQUITS AND FOREVER DISCHARGES the Indemnitees and any person acting on behalf of the City, from any and all Claims, direct or indirect, known or unknown, foreseen or unforeseen, which Developer now has or which may arise in the future on account of or in any way arising out of or in connection with the physical condition of the City Property, the presence of Hazardous Materi al in, on, under or about the City Property , or any law or regulation applicable thereto including, without limiting the generality of the foregoing, all Environmental Laws.
DEVELOPER ACKNOWLEDGES THAT DEVELOPER IS FAMILIAR WITH SECTION 1542 OF THE CALIFORNIA CIVIL CODE, WHICH PROVIDES AS FOLLOWS:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
THAT THE CREDITOR OR RELEASING PARTY DOES NOT
KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT
THE TIME OF EXECUTING THE RELEASE AND THAT, IF
KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY
AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR
OR RELEASED PARTY.
BY INITIALING BELOW, DEVELOPER EXPRESSLY WAIVES THE BENEFITS OF SECTION 1542 OF THE CALIFORNIA CIVIL CODE WITH RESPECT TO THE FOREGOING RELEASE:
27 Developer’s initials: _____________
Notwithstanding the foregoin g, the releases and waivers set forth in Sections 6.1 through 6.5 , inclusive, shall not relieve City of its liability for (a) any breach of City’s Representations; (b) any breach of any of City’s covenants in this Agreement that expressly survive the Closing; and/or (c) City’s fraud or willful misconduct in connection with the Property or this Agreement.
6.6.1 City’s Post-Closing Obligations. City hereby covenants and agrees that after Close of Escrow on each particular Lot it will cooperate with De veloper’s reasonable requests to cause the removal of certain of-record easements and other encumbrances that burden the Property, to the extent that they may hamper or impede development of the Project. This obligation shall survive the Close of Escrow.
6.6.2 Developer’s Post-Closing Obligations. Developer hereby covenants and agrees that:
(a) Developer shall not knowingly permit the City Property, or any portion thereof to be a site for the use, generation, treatment, manufacture, storage, disposal or transportation of Hazardous Material or otherwise knowingly permit the presence or release of Hazardous Material in, on, under, about or from the City Property with the exception of limited amounts of cleaning supplies and other materials customarily used in construction, use or maintenance of commercial properties and related parking facilities similar in nature to the Project, and used, stored and disposed of in compliance with Environmental Laws.
(b) Developer shall keep and maintain the City Property and each portion thereof in compliance with and shall not cause or permit the Downtown Project or the City Property, or any portion of the foregoing to be in violation of, any Environmental Laws.
(c) Upon receiving actual knowledge of the same, Developer shall immediately advise City in writing of: (i) any and all enforcement, cleanup, removal or other governmental or regulatory actions instituted, completed or threatened against the Developer, or the Property pursuant to any applicable Environmental Laws; (ii) any and all claims made or threatened by any third party against the Developer or the City Property relating to damage, contribution, cost recovery, compensation, loss or injury resulting from any Hazardous Material; (iii) the presence or release of any Hazardous Material in, on, under, about or from the Property; or (iv) Developer’s discovery of any occurrence or condition on any real property adjoining or in the vicinity of the Project classifie d as “Border Zone Property” under the provisions of California Health and Safety Code, Sections 25220, et seq., or any regulation adopted in connection therewith, that may in any way affect the City Property pursuant to any Environmental Laws or cause it or any part thereof to be designated as Border Zone Property. The matters set forth in the foregoing clauses (i) through (iv) are hereinafter referred to as “Hazardous Materials Claims”). The City shall have the right to join and participate in, as a party if it so elects, any legal proceedings or actions initiated in connection with any Hazardous Materials Claim.
(d) Developer shall permit City to join and participate in, as a party if it so elects, any legal proceedings or actions initiated in connection with any Hazardous Materials Claims and to have its reasonable attorneys’ fees in connection therewith paid by Developer.
28 6.7 Environmental Indemnity. To the greatest extent permitted by law, Developer shall indemnify, defend (with counsel approved by City) and hold Indemnitees harmless from and against all Claims resulting, arising, or based directly or indirectly in whole or in part, upon (i) the presence, release, use, generation, discharge, storage or disposal of any Hazardous Material on, under, in or about the City Property, or the transportation of any such Hazardous Material to or from, the City Property, or (ii) the failure of Developer, Developer’s employees, agents, contractors, subcontractors, or any person acting on behalf of or as the invitee of any of the foregoing to comply with Environmental Laws, except to the extent caused by the City’s gross negligence or willful misconduct. The foregoing indemnity shall further apply to any residual contamination in, on, under or about the City Property or affecting any natural resources, and to any contamination of any property or natural resources arising in connection with the generation, use, handling, treatment, storage, transport or disposal of any such Hazardous Material, and irrespective of whether any of such activities were or will be undertaken in accordance with Environmental Laws.
Developer’s obligation to indemnify the Indemnitees shall not be limited or impaired by any of the following: (i) any amendment or modification of any City Docum ent; (ii) any extensions of time for performance required by any City Document; (iii) the accuracy or inaccuracy of any representation and warranty made by Developer under this Agreement or by Developer or any other party under any City Document, and (iv) the release of Developer or any other person, by City or by operation of law, from performance of any obligation under any City Document.
The provisions of this Section 6.7 shall be in addition to any and all other obligations and liabilities that Developer may have under applicable law, and each Indemnitee shall be entitled to indemnification under this Section without regard to whether City or that Indemnitee has exercised any rights against the City Property or any other security, pursued any rights against any guarantor or other party, or pursued any other rights available under the City Documents or applicable law. The obligations of Developer to indemnify the Indemnitees under this Section shall survive any foreclosure proceeding, any foreclosure s ale, and any delivery of any deed in lieu of foreclosure. Developer’s indemnification obligations under this Section shall not extend to Claims to the extent arising from the gross negligence or willful misconduct of the Indemnitees and are subject to the additional terms set forth in Section 10.2 below.
6.8 No Limitation. Developer hereby acknowledges and agrees that Developer’s duties, obligations and liabilities under this Agreement are in no way limited or otherwise affected by any information the City may have concerning the Property and/or the presence in, on, under or about the Property of any Hazardous Material, whether the City obtained such information from the Developer or from its own investigations.
6.9 Definitions.
6.9.1 “Hazardous Material” means any chemical, compound, material, mixture, or substance that is now or may in the future be defined or listed in, or otherwise classified pursuant to any Environmental Laws (defined below) as a “hazardous substance”, “hazardous material”, “hazardous waste”, “extremely hazardous waste”, infectious waste”, toxic substance”, toxic pollutant”, or any other formulation intended to define, list or classify substances by reason of deleterious properties such as ignitability, corrosivity, reactivity, carci nogenicity, or toxicity. The 29 term “hazardous material” shall also include asbestos or asbestos -containing materials, radon, chrome and/or chromium, polychlorinated biphenyls, petroleum, petroleum products or by - products, petroleum components, oil, mineral spirits, natural gas, natural gas liquids, liquefied natural gas, or synthetic gas usable as fuel, perchlorate, and methyl tert-butyl ether, whether or not defined as a hazardous waste or hazardous substance in the Environmental Laws.
6.9.2 “Environmental Laws” means any and all federal, state and local statutes, ordinances, orders, rules, regulations, guidance documents, judgments, governmental authorizations or directives, or any other requirements of governmental authorities, as may presently exist, or as may be amended or supplemented, or hereafter enacted, relating to the presence, release, generation, use, handling, treatment, storage, transportation or disposal of Hazardous Material, or the protection of the environment or human, plant or animal h ealth, including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986 (42 U.S.C. § 9601), the Hazardous Materials Transportation Act (4 9 U.S.C. § 1801 et seq.), the Resource Conservation and Recovery Act (42 U.S.C. § 6901 et seq.), the Federal Water Pollution Control Act (33 U.S.C. § 1251 et seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.), the Toxic Substances Control Act (15 U.S.C. § 2601 et seq.), the Oil Pollution Act (33 U.S.C. § 2701 et seq.), the Emergency Planning and Community Right -to-Know Act (42 U.S.C. § 11001 et seq .), the Porter-Cologne Water Quality Control Act (Cal. Water Code § 13000 et seq.), the Toxic Mold Protection Act (Cal. Health & Safety Code § 26100, et seq.), the Safe Drinking Water and Toxic Enforcement Act of 1986 (Cal. Health & Safety Code § 25249.5 et seq.), the Hazardous Waste Control Act (Cal. Health & Safety Code § 25100 et seq .), the Hazardous Materials Release Response Plans & Inventory Act (Cal. Health & Safety Code § 25500 et seq.), and the Carpenter- Presley-Tanner Hazardous Substances Account Act (Cal.
Health and Safety Code, Section 25300 et seq.).
ARTICLE VII
LIMITATIONS ON CHANGE IN OWNERSHIP, MANAGEMENT
AND CONTROL OF DEVELOPER
7.1 Identity of Developer; Changes Only Pursuant to this Agreement. Developer and its Key Principals have represented that they possess the necessary expertise, skill and ability to carry out the development of the Downtown Project pursuant to this Agreement. The qualifications, experience, financial capacity and expert ise of Developer and its Key Principals are of particular concern to the City. It is because of these qualifications, experience, financial capacity and expertise that the City has entered into this Agreement with Developer. No voluntary or involuntary successor, assignee or transferee of Developer shall acquire any rights or powers under this Agreement, except as expressly provided herein.
7.2 Prohibition on Transfer. Prior to City’s issuance of final certificates of occupancy or equivalent for each particular Lot of the Project, Developer shall not, except as expressly permitted by this Agreement, directly or indirectly voluntarily involuntarily or by operation of law make or attempt any total or partial sale, transfer, conveyance, encumbrance, ass ignment (including without limitation, any assignment for security purposes) or lease (collectively, “Transfer”) of the whole or any part of that particular Lot of the Downtown Project, or this Agreement, without the prior written
30 approval of City which approval shall not be unreasonably withheld. Any such attempt to assign this Agreement without the City’s consent shall be null and void and shall confer no rights or privileges upon the purported assignee. In addition to the foregoing, prior to City’s issuance of final certificates of occupancy or equivalent for the Project, except as expressly permitted by this Agreement, Developer shall not undergo any significant change of ownership without the prior written approval of City. For purposes of this Agreement, a “significant change of ownership” shall mean a transfer of the beneficial interest of more than twenty -five percent (25%) in aggregate of the present ownership and /or control of Developer, taking all transfers into account on a cumulative basis.
7.3 Permitted Transfers.
7.3.1. Notwithstanding any contrary provision hereof, the prohibitions set forth in this Article shall not be deemed to prevent: (a) conveyance of any Lot of the Downtown Project after certificate of completion is issued for that particular Lot , (b) the granting of temporary easements or permits to facilitate development of the City Property ; (c) the dedication of any property required pursuant to this Agreement; (d) the lease or rental of commercial and retail space in the Downtown Project, (e) assignments creating security interests for the purpose of financing the acquisition of the City Property or the construction or permanent financing of the Downtown Project, as may be approved by the City, and subject to the requirements of Article VIII, or Transfers directly resulting from the foreclosure of, or granting of a deed in lieu of foreclosure of, such a security interest; (f) a Transfer to an entity under the direct control of or under common control with Developer, a Key Principal, or Affiliate; (g) a Transfer to a limited partnership (or a limited liability company) in which Developer, a Key Principal, or an Affiliate of Developer is the managing general partner (or managing member); (h) the admission of limited partners (or non-managing members), and any transfer of limited partnership (or non -managing member) interests in accordance with Developer’s agreement of limited partnership or limited liability company operating agreement, as applicable; (i) transfers by individu al shareholders or members of Developer, or any of its Key Principals for estate planning purposes; or (j) the removal of the general partner (or managing member) of Developer by the investor limited partners (or non -managing members) for a default under D eveloper’s partnership agreement (or limited liability company operating agreement), provided that the replacement general partner (or managing member) is an entity reasonably satisfactory to City. Developer shall provide notice to City of the occurrence of a Permitted Transfer within ten (10) business days after such Permitted Transfer. Notwithstanding the above, Developer may partner with a third party, who may hold a more than fifty percent (50%) partnership interest, whether as a general or limited partner, in such venture for the purposes of developing Lot 2 only.
7.3.2 To the extent that any Lot of the City Property is leased at time prior to the recording of the Certificate of Completion for that particular Lot as permitted by Section 7.3.1(b) of this Agreement, the lease documents shall require the lessee to provide a commercially - reasonable estoppel to City at any time, and from time to time, within fifteen (15) days after receipt of written request from City to Developer, certifying that (i) the lease is in full force and effect and binding on the parties (if such be the case), (ii) the lease has not been modified or amendment, or if so amended, identifying the amendments, and (iii) Developer is not in default in the performance of its obligations under the lease, or if in default, describing the nature of any such defaults. In the 31 event that the relevant lease is terminated, Developer shall notify City within fifteen (15) business days after such termination.
7.4 Requirements for Proposed Transfers. City will consent to a proposed Transfer of this Agreement, the City Property , the Improvements or part thereof if all of the following requirements are met (provided however, the requirements of this Section 7.4 shall not apply to Transfers described in Section 7.3):
(i) The proposed transferee demonstrates to the City’s satisfaction that it has the qualifications, experience and financial resources necessary and adequate as may be reasonably determined by the City to competently complete and manage the Project and to othe rwise fulfill the obligations undertaken by the Developer under this Agreement.
(ii) The Developer and the proposed transferee shall submit for City review and approval all instruments and other legal documents proposed to effect any Transfer of all or any part of or interest in the City Property, the Improvements or this Agreement, including without limitation, the organizational documents and authorizing resolution of the proposed transferee, and such documentation of the proposed transferee’s qualifications and development capacity as the City may reasonably request.
(iii) The proposed transferee shall expressly assume all of the rights and obligations of the Developer under this Agreement and the other City Documents arising after the effective date of the Transfer and all obligations of Developer arising prior to the effective date of the Transfer (unless Developer expressly remains responsible for such obligations), and shall agree to be subject to and assume all of Developer’s obligations pursuant to the Conditions of Approval and all other conditions, and restrictions set forth in this Agreement. The assumption of such obligations shall be documented in an assignment and assumption agreement in form approved by City.
(iv) The Transfer shall be effectuated pursuant to a written instrument satisfactory to the City in form recordable in the Official Records.
Consent to any proposed Transfer may be given by the City’s Authorized Representative unless the Authorized Representative, in his or her discretion, refers t he matter of approval to the City Council. If the City has not rejected a proposed Transfer or requested additional information regarding a proposed Transfer in writing within thirty (30) days following City’s receipt of written request by Developer, the proposed Transfer shall be deemed approved.
7.5 Effect of Transfer without City Consent.
7.5.1 In the absence of specific written agreement by the City, no Transfer by Developer shall be deemed to relieve the Developer or any other party from any obligation under this Agreement.
7.5.2 It shall be an Event of Developer Default hereunder entitling City to pursue remedies including without limitation, termination of this Agreement if without the prior written approval of the City, Developer assigns or Transfers this Agreement, the Improvements, or the City Property, or any part thereof or interest therein, or undertakes any other Transfer (including without
32 limitation any assignment for security or encumbrance of the Property or any part thereof) in violation of Article VII. This Section 7.5.2 shall not apply to Transfers described in Section 7.3).
7.6 Recovery of City Costs. Within ten (10) days following City’s delivery to Developer of an invoice detailing such costs, Developer shall reimburse City for all City costs, including but not limited to reasonable attorneys’ fees, incurred in reviewing instruments and other legal documents proposed to effect a Transfer of this Agreement, the City Property or the Improvements, or part thereof or interest therein, and in reviewing the qualifications and financial resources of a proposed successor, assignee, or transferee.
7.7 Termination of Transfer Restrictions on Project Completion . After the Completion Date, or certificate of occupancy, which ever is sooner or upon Developer’s Transfer of the Project to a third party, Developer shall have no further obligations or liabilities under this Agreement except with respect to matters arising during such Developer’s period of ownership of the City Property, which matters expressly survive the termination or expiration of this Agreement.
ARTICLE VIII
SECURITY FINANCING AND RIGHTS OF MORTGAGEES
8.1 Mortgages and Deeds of Trust for Development. Mortgages and deeds of trust, or any other reasonable security instrument are permitted to be placed upon the City Property or the Improvements only for the purpose of securing loans for the purpose of financing the acquisition of the City Property , the design and construction of the Improvements, and other expenditures reasonably necessary for the development of the Project p ursuant to this Agreement. Developer shall not enter into any conveyance for such financing without the prior written approval of the City, provided by the City’s Authorized Representative or his or her designee, which shall not be unreasonably withheld, conditioned, or delayed. As used herein, the terms “mortgage” and “deed of trust” shall mean any security instrument used in financing real estate acquisition, construction and land development.
8.2 Holder Not Obligated to Construct. The holder of any mort gage or deed of trust authorized by this Agreement shall not be obligated to complete construction of any portion of the Downtown Project or to guarantee such completion. Nothing in this Agreement shall be deemed to permit or authorize any such holder to devote the City Property or any portion thereof to any uses, or to construct any improvements thereon, other than those uses, or improvements provided for or authorized by this Agreement.
8.3 Notice of Default and Lender Right to Cure. Whenever City delivers any notice of default hereunder, City shall concurrently deliver a copy of such notice to each holder of record of any mortgage or deed of trust secured by the City Property or the Improvements, provided that City has been provided with the address for d elivery of such notice. City shall have no liability to any such holder for any failure by the City to provide such notice to such holder. Each such holder shall have the right, but not the obligation, at its option, to cure or remedy any such default or breach 33 within the cure period provided to Developer. In the event that possession of the City Property or the Improvements (or any portion thereof) is required to effectuate such cure or remedy, the holder shall be deemed to have timely cured or remedied the default if it commences the proceedings necessary to obtain possession of the City Property or Improvements, as applicable, within the applicable cure period, diligently pursues such proceedings to completion, and after obtaining possession, diligently completes such cure or remedy. A holder who chooses to exercise its right to cure or remedy a default or breach shall first notify City of its intent to exercise such right prior to commencing to cure or remedy such default or breach. Nothing contained in this Agreement shall be deemed to permit or authorize such holder to undertake or continue the construction of any portion of the Downtown Project (beyond the extent necessary to conserve or protect the same) without first having expressly assumed in w riting Developer’s obligations to City under this Agreement. The holder in that event must agree to complete, in the manner provided in this Agreement, the portion of the Downtown Project encompassed by the Lot which the holder holds an interest to and the Improvements and submit evidence reasonably satisfactory to City that it has the development capability on staff or retainer and the financial capacity necessary to perform such obligations. Any such holder properly completing any portion of the Downtown Project pursuant to this Section shall assume all rights and obligations of Developer under this Agreement.
8.4 Failure of Holder to Complete Improvements. In any case where, six (6) months after default by Developer in completion of construction of any phase of the Downtown Project, the holder of record of any mortgage or deed of trust has not exercised its option to construct that portion of the Downtown Project, or having first exercised such option, has not proceeded diligently with such work, City s hall be afforded those rights against such holder that it would otherwise have against Developer under this Agreement.
8.5 City Right to Cure Defaults. In the event of a breach or default by Developer under a mortgage or deed of trust secured by the City Property or the Improvements, City may cure the default, without acceleration of the subject loan, following prior notice thereof to the holder of such instrument and Developer. In such event, Developer shall be liable for, and City shall be entitled to reimbursement from Developer for all costs and expenses incurred by City associated with and attributable to the curing of the default or breach.
8.6 Holder to be Notified. Developer agrees to use best efforts to ensure that each term contained herein dealing with security financing and rights of holders shall be either inserted into the relevant deed of trust or mortgage or acknowledged and accepted in writing by the holder prior to its creating any security right or interest in the City Property or the Improvements.
8.7 Modifications to Agreement. City shall not unreasonably withhold its consent to modifications of this Agreement requested by Downtown Project lenders or investors provided such modifications do not alter City’s substantive rights and obligations under this Agreement.
8.8 Estoppel Certificates. Either Party shall, at any time, and from time to time, within fifteen (15) days after receipt of written request from the other Party, execute and deliver to such Party a written statement certifying that, to the knowledge of the certifying Party: (i) this Agreement is in full force and effect and a binding obligation of the Parties (if such be the case), (ii) this Agreement has not been amended or modified, or if so amended, identifying the amendments, and (iii) the requesting Party is not in default in the performance of its obligations under this Agreement, or if in default, describing the nature of any such defaults.
34 ARTICLE IX
DEFAULTS, REMEDIES AND TERMINATION
9.1 Event of Developer Default. The following events shall constitute an event of default on the part of Developer hereunder (“Event of Developer Default”):
(a) Developer fails to commence or complete construction of each phase of the Downtown Project within the time period s set forth in Section 5.1, or subject to Force Majeure, abandons or suspends construction of any phase of the Downtown Project prior to completion for a period of one-hundred and twenty (120) days or more;
(b) A Transfer occurs, either voluntarily or involuntarily, in violation of Article VII;
(c) Developer fails to maintain insurance as required pursuant to this Agreement, and Developer fails to cure such default, after notice, within five (5) days; (d) Subject to Developer’s rights pursuant to Section 5.24 above, Developer fails to pay prior to delinquency taxes or assessments due on the City Property or the Improvements, or fails to pay when due any other charge that may result in a lien on the City Property or the Improvements, and Developer fails to cure such default within twenty (20) days after notice of delinquency, but in all events prior to the date upon which the holder of any such lien has the right to foreclose thereon;
(e) A default arises under any loan secured by a mortgage, deed of trust or other security instrument recorded against the City Property and remains uncured beyond any applicable cure period such that the holder of such security instrument has the right to accelerate repayment of such loan;
(f) Any representation or warranty contained i n this Agreement or in any application, financial statement, certificate or report submitted to the City in connection with this Agreement proves to have been incorrect in any material and adverse respect when made and continues to be materially adverse to the City;
(g) If Developer, pursuant to or within the meaning of the United States Bankruptcy Code or any other federal or state law relating to insolvency or relief of debtors (“Bankruptcy Law”): (i) commences a voluntary case or proceeding; (ii) consents to the entry of an order for relief in an involuntary case; (iii) consents to the appointment of a trustee, receiver, assignee, liquidator or similar official (iv) makes an assignment for the benefit of its creditors; or (v) admits in writing its inability to pay its debts as they become due;
(h) A court of competent jurisdiction shall have made or entered any decree or order (1) adjudging Developer to be bankrupt or insolvent, (2) approving as properly filed a petition 35 seeking reorganization of Developer seeking any arrangement for Developer under bankruptcy law or any other applicable debtor’s relief law or statute of the United States or any state or other jurisdiction, (3) appointing a receiver, trustee, liquidator, or assignee of Developer in bankruptcy or insolvency or for any of its properties, or (4) directing the winding up or liquidation of Developer, in each case if such decree, order, petition, or appointment is not removed or rescinded within sixty (60) days;
(i) Developer shall have assigned its assets for the benefit of its creditors (other than pursuant to a mortgage loan) or suffered a sequestration or attachment of or execution on any substantial part of its property, unless the property so assigned, sequestered, attached or executed upon shall have been returned or released within sixty (60) days after such event (unless a lesser time period is permitted for cure pursuant to paragraphs (h) or (i) above or pursuant to any other mortgage on the Property, in which event such lesser time period sh all apply under this subsection as well) or prior to any sooner sale pursuant to such sequestration, attachment, or execution; (j) Developer shall have voluntarily suspended its business or Developer shall have been dissolved or terminated;
(k) An event of material default arises under any City Document and remains uncured beyond any applicable cure period; or
(l) Developer defaults in the performance of any term, provision, covenant or agreement contained in this Agreement other than an obligation enumerated in this Section 9.1 and unless a shorter cure period is specified for such default, the default continues for ten (10) days in the event of a monetary default or thirty (30) days in the event of a nonmonetary default after the date upon which City shall have given written notice of the default to Developer; provided however, if the default is of a nature that it cannot be cured within thirty (30) days, an Event of Developer Default shall not arise hereunder if Developer, as applicable, commences to cure the default within thirty (30) days and thereafter prosecutes the curing of such default with due diligence and in good faith to completion.
9.2 City Default. An event of default on the part of City (“Event of City Default”) shall arise hereunder if City fails to keep, observe, or perform any of its covenants, duties, or obligations under this Agreement, and the default continues for a period of thirty (30) days [cure periods to mirror each other] after written notice there of from Developer to City, or in the case of a default which cannot with due diligence be cured within sixty (60) days, City fails to commence to cure the default within sixty (60) days of such notice and thereafter fails to prosecute the curing of such default with due diligence and in good faith to completion.
9.3 City’s Right to Terminate Agreement. If an Event of Developer Default shall occur and be continuing beyond any applicable cure period, then City shall, in addition to other rights available to i t under law or this Agreement, have the right to terminate this Agreement. If City makes such election, City shall give written notice to Developer and to any mortgagee entitled to such notice specifying the nature of the default and stating that this Agr eement shall expire and terminate on the date specified in such notice, and upon the date specified in the notice, this Agreement and all rights of Developer under this Agreement, shall expire and terminate.
36 9.4 City’s Remedies and Rights Upon an Event of Developer Default. Upon the occurrence of an Event of Developer Default and the expiration of any applicable cure period, City shall have all remedies available to it under this Agreement or under law or equity, including, but not limited to the following , and City may, at its election, without notice to or demand upon Developer, except for notices or demands required by law or expressly required pursuant to the City Documents, exercise one or more of the following remedies:
(a) Seek specific performance to enforce the terms of the City Documents; (b) Terminate this Agreement pursuant to Section 9.3 and recover the Property; and
(c) Pursue any and all other remedies available under this Agreement or under law or equity to enforce the terms of the City Documents and City’s rights thereunder.
9.5 Developer’s Remedies Upon an Event of City Default. Upon the occurrence of an Event of City Default, Developer may, at its election, exercise one or more of the following remedies: (a) bring an action for equitable relief seeking the specific performance of the terms and conditions of this Agreement, and/or enjoining, abating, or preventing any violation of such terms and conditions, (b) terminate this Agreement, and/or (c) pursue any and all other remedies available under this Agreement or under law or equity to enforce the terms of this Agreement and Developer’s rights hereunder.
9.6 Remedies Cumulative; No Consequential or Punitive Damages. Except as otherwise expressly stated in this Agreement, the rights and remedies of the Parties are cumulative, and the exercise by either Party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different time, of any other rights or remedies for the same or any other default by the other Party. Notwithstanding anything to the contrary contained in this Agreement, the Parties each expressly waive all rights to seek or recover consequential or punitive damages in connection with any default in the performance of this Agreement, or breach thereof.
9.7 Inaction Not a Waiver of Default. No failure or delay by either Party in asserti ng any of its rights and remedies as to any default shall operate as a waiver of such default or of any such rights or remedies, nor deprive either Party of its rights to institute and maintain any action or proceeding which it may deem necessary to protec t, assert or enforce any such rights or remedies in the same or any subsequent default.
9.8 Power of Termination. If following conveyance of any of the Lots of the City Property to Developer, Developer (i) fails to begin construction of th at particular Lot o f the Downtown Project within the time specified in Section 5.1 as such date may be extended pursuant to the terms hereof, (ii) abandons or suspends construction work for a period of sixty (60) days after written notice from City, (iii) fails to complete construction of that particular Lot of the Downtown Project by the time specified in Section 5.1 as such date may be extended pursuant to the terms hereof, or (iv) directly or indirectly, voluntarily or involuntarily Transfers that Lot of the City Property or part thereof or this Agreement in violation of Article VII, the City may re-enter and take 37 possession of that particular Lot of the City Property or any portion thereof with all improvements thereon without payment or compensation to Developer, and revest in the City the estate theretofore conveyed to the Developer. The interest created pursuant to this Section 9.8 shall be a “power of termination” as defined in California Civil Code Section 885.010, and shall be separate and distinct from the City’s option to purchase that particular Lot of the City Property under the same or similar conditions specified in Section 9.9. City’s rights pursuant to this Section 9.8 shall not defeat, render invalid or limit any mortgage or deed of trust permitted by this Agreement or any rights or interests provided in this Agreement for the protection of the holders of such mortgages or deeds of trust.
Upon revesting in the City of title to the particular Lot of the City Property or any portion thereof as provided in this Section 9.8, the City shall use its best efforts to resell the Lot of the City Property or applicable portion thereof and as soon as possible, in a commercially reasonable manner to a qualified and responsible pa rty or parties (as determined by the City) who will assume the obligation of completing and operating th at portion of the Downtown Project in accordance with the uses specified for such property in this Agreement and in a manner satisfactory to the City.
Upon such resale of the particular Lot of the City Property or any portion thereof, the sale proceeds shall be applied as follows:
(a) First, to reimburse the City for all costs and expenses incurred by City, including but not limited to salaries of personnel and legal fees incurred in connection with the recapture and resale of the particular Lot of the City Property; all taxes and assessments payable prior to resale, and all applicable water and sewer charges; any payments necessary to discharge any encumbrances or liens on the particular Lot of the City Property at the time of revesting of title thereto in the City or to discharge or prevent from attaching any subsequent encumbrances or liens due to obligations, defaults, or acts of the Developer, its successors or transferees; any expenditures made or obligations incurred with respect to the completion of the Project or any part thereof on the particular Lot of the City Property; and any other amounts owed to the City by Developer and its successors or transferee pursuant to the City Documents or otherwise.
(b) Second, to reimburse the City for damages to which it is entitled under this Agreement by reason of the Developer’s default (which shall not include consequential or punitive damages).
(c) Third, to reimburse the Developer, its successor or transferee, up to the amount equal to:
(1) The payment made to the City for that particular Lot of the City Property; plus
(2) The fair market value of any new improvements constructed by Developer and existing on that particular Lot of the City Property at the time of City’s exercise of its rights under this Section; less
(3) Any gains or income withdrawn or made by the Developer from that particular Lot of the City Property or applicable portion thereof or the improvements thereon.
Notwithstanding the foregoing, the amount calculated pursuant to this subsection (c) shall not exceed the fair market value of that particular Lot of the City Property or applicable portion
38 thereof, together with the improvements thereon as of the date of the default or failure which gave rise to the City’s exercise of the power of termination.
(4) Any balance remaining after such reimbursements shall be retained by the City.
The rights established in this Section 9.8 are to be interpreted in light of the fact that the City will convey each particular Lot of the City Property to the Developer for completion of the Project as specified herein and not for speculation.
Notwithstanding anything in this Section 9.8, if City gives notice to Developer of a breach, City shall send a copy of the notice to each holder of record of any deed of trust on the portion of the Property in which Developer has a legal interest ("Financier"), provided that the Financier has given prior written notice of its name and mailing address to City and the notice makes specific reference to this section. The copies shall be sent by United States mail, reg istered or certified, postage prepaid, return receipt requested, and shall be deemed received upon the third (3rd) day after deposit.
Each Financier that has given prior notice to City pursuant to this section shall have the right, at its option and insofar as the rights of City are concerned, to cure any such breach within eighteen (18) days after the giving of the notice by City. If such breach cannot be cured within such time period, the Financier shall have such additional period as may be reasonably required to cure the same, provided that the Financier gives notice to City of its intention to cure and commences the cure within eighteen (18) days after giving of the notice by City and thereafter diligently prosecutes the same to completion. City shall not commence legal action against Developer by reason of Developer's breach without allowing the Financier to cure the same as specified herein. Notwithstanding any cure by Financier, this Agreement shall be binding and effective against the Financier and every owner of the Property, or part thereof, whose title thereto is acquired by foreclosure, trustee sale or otherwise; provided, however, Financier and such owner shall not be responsible for any matters that occurred prior to their acquisition of the Project.
9.9 Option to Purchase, Enter and Possess Upon Default . The City shall have the additional right at its option to purchase, enter and take possession of that particular Lot of the City Property with all improvements thereon (the “ Repurchase Option”), if after conveyance of the Property, Developer (i) fails to begin construction of the Project on that particular Lot within the time specified in Section 5.1 as such date may be extended pursuant to the terms hereof, (ii) abandons or suspends construction of that particular Lot of the Downtown Project for a period of sixty (60) days after written notice from City, (iii) fails to complete construction of the Project by the time specified in Section 5.1 as such date may be extended pursuant to the terms hereof, or (iv) directly or indirectly, voluntarily or involuntarily Transfers the City Property or part thereof or this Agreement in violation of Article VII. If it exercises Repurchase Option A, the City shall pay to the Developer cash in an amount equal to:
(i) The Purchase Price; plus
39 (ii) The fair market value of solely any new improvements constructed on the particular Lot of the City Property by Developer and existing on the particular Lot of the City Property at the time of exercise of the Option; less
(iii) Any gains or income withdrawn or made by the Developer from the applicable Lot of the City Property or the improvements thereon; less
(iv) The value of any liens or encumbrances on the applicable Lot of the City Property which the City assumes or takes subject to; less
(v) Any amounts owed to the City by Developer and its successors or transferee pursuant to the City Documents or otherwise; less
(vi) All taxes, assessments and utility charges payable with respect to the applicable Lot of the City Property for the period prior to the date the City acquires title to the applicable Lot of the City Property; less
(vii) The amount of any payments necessary to discharge or prevent from attaching any subsequent encumbrances or liens due to obligations, defaults, or acts of the Developer, its successors or transferees; less
(viii) Any damages to which the City is entitled under this Agreement by reason of Developer’s default.
In order to exercise the Repurchase Option, the City shall give Developer written notice of such exercise, and Developer shall, within thirty (30) days after receipt of such notice, provide City with a summary of all of Developer’s costs incurred as described in this Section 9.9. Within thirty (30) days of City’s receipt of such summary, City shall pay into an escrow established for such purpose cash in the amount of all sums owing pursuant to this Section 9.9, and Developer shall execute and deposit into such escrow a grant deed transferring to City all of Developer’s interest in the applicable Lot of the City Property , or portion thereof, as applicable, and the improvements located thereon.
9.10 Memorandum of Power of Termination/Option to Purchase. The Parties shall cause a memorandum of the rights granted the City in Sections 9.8 and 9.9 of this Agreement to be recorded in the Official Records at the time of the Close of Escrow for conveyance of each particular Lot of the City Property to Developer. In addition, the rights afforded City pursuant to Sections 9.8 and 9.9 may be described in the Grant Deed.
9.11 Rights of Mortgagees. Any rights of the City under this Article IX shall not defeat, limit or render invalid any mortgage or deed of trust permitted by this Agreement or any rights provided for in this Agreement for the protection of holders of such instruments. Any conveyance or return of a particular Lot of the City Property to the City pursuant to this Article IX shall be subject to mortgages and deeds of trust permitted by this Agreement.
9.12 Prohibition on Assignment. The City shall not have the right to assign the Repurchase Option to any other governmental entity or private party.
40 ARTICLE X
INDEMNITY AND INSURANCE
10.1 Indemnity. To the greatest extent permitted by law, Developer shall indemnify, defend (with counsel approved by City) and hold the Indemnitees harmless from and against any and all Claims (incl uding without limitation, Claims arising from any injury, death, illness, property damage, or loss of property) arising directly or indirectly, in whole or in part, as a result of or in connection with the development, construction, improvement, operation, ownership or maintenance of the Downtown Project or the City Property, or any part thereof by Developer or Developer’s contractors, subcontractors, agents, employees or any other party acting for or on behalf of Developer, or otherwise arising out of or i n connection with Developer’s performance or failure to perform under this Agreement, including without limitation, Claims arising or alleged to have arisen in connection with any violation of Applicable Laws in connection with the development, operation or management of the Project, or relating to approval of the Project or approval of this Agreement. Developer’s indemnification obligations under this Section 10.1 shall not extend to Claims to the extent arising from the gross negligence or willful miscon duct of Indemnitees and are subject to the additional terms set forth in Section 10.2 below. The provisions of this Section 10.1 shall survive the expiration or earlier termination of this Agreement. It is further agreed that City does not and shall not waive any rights against Developer that it may have by reason of this indemnity and hold harmless agreement because of the acceptance by City, or the deposit with City by Developer, of any of the insurance policies described in this Agreement. Notwithstanding the above, no duty to indemnify shall arise for third party claims arising from the negotiation or execution of this Agreement.
10.2 Terms Applicable to Indemnity Provisions. The terms set forth in this Section
10.2 shall apply to all provisions of this Agreement that pertain to Developer’s obligations to indemnify City and the other Indemnitees, including without limitation, Sections 5.11, 5.14,
5.15, 6.1, 6.7, 10.1, and 11.1. In connection with each such provision, all of the following shall apply:
(a) City does not and shall not waive any rights against Developer that it may have by reason of any indemnity and hold harmless provision set forth in this Agreement because of the acceptance by City, or the deposit with City by Developer, of any of the insur ance policies described in this Agreement.
(b) Developer’s obligation to indemnify the Indemnitees shall not be limited or impaired by any of the following: (i) any amendment or modification of any City Document; (ii) any extensions of time for performance r equired by any City Document; (iii) the accuracy or inaccuracy of any representation and warranty made by Developer under this Agreement or by Developer or any other party under any City Document, and (iv) the release of Developer or any other person, by City or by operation of law, from performance of any obligation under any City Document.
41 10.3 Liability, Workers Compensation, and Property Insurance. (a) Commercial General Liability . Developer (and until issuance of the final certificate of occupancy or equivalent for the Project all contractors working on behalf of Developer on the Project) shall maintain a commercial general liability policy including coverage for bodily injury, property damage, products, completed operations and contractual liabilit y coverage with coverage limits in the greater of: (a) the amounts required by the construction and permanent lenders for the Project, or (b) Two Million Dollars ($2,000,000) each occurrence, Two Million Dollars ($2,000,000) annual aggregate, together wit h Five Million Dollars ($5,000,000) excess liability coverage, or such other policy limits as City may require in its reasonable discretion. Such policy or policies shall be written on an occurrence basis and shall name the Indemnitees as additional insureds.
(b) Automobile. Developer (and until issuance of the final certificate of occupancy or equivalent for the Project all contractors working on behalf of Developer on the Project) shall maintain a comprehensive automobile liability coverage in the amount of Two Million Dollars ($2,000,000), combined single limit including coverage for owned and nonowned vehicles. Automobile liability policies shall name the Indemnitees as additional insureds.
(c) Worker’s Compensation; Employer’s Liability. Developer shall furnish or cause to be furnished to City evidence satisfactory to City that Developer, and any contractor with whom it has contracted for the performance of work on the Property or otherwise pursuant to this Agreement, carries statutory Workers’ Compensati on insurance and Employer’s Liability insurance in a minimum amount of Two Million Dollars ($2,000,000) per accident.
(d) Builder’s Risk. On or before the Commencement Date and continuing until issuance of the final certificate of occupancy or equivalent for the Project, Developer and all contractors working on behalf of Developer shall maintain a policy of builder’s all-risk insurance in an amount not less than the full insurable cost of the Project on a replacement cost basis naming City as loss payee as its interests may appear in an amount to be approved by the City.
(e) Professional Liability/Errors and Omissions . Professional Liabilit y/Errors and Omissions insurance as appropriate for design/build operations with limits not less than Two Million Dollars ($2,000,000) each claim. If the professional liability/errors and omissions insurance is written on a claims made form: (i) the retro active date must be shown and must be before the Effective Date, (ii) insurance must be maintained and evidence of insurance must be provided for at least three (3) years after completion of Project construction, and (iii) if coverage is cancelled or non -renewed and not replaced with another claims made policy form with a retroactive date prior to the Effective Date, Developer must purchase extended period coverage for a minimum of three (3) years after completion of construction.
(f) Property. From and after closing on each particular Lot of the City Property, and through the Completion Date, Developer shall maintain property insurance covering all risks of loss including earthquake (if required) and flood (if required) for 100% of the replacement value of that particular Lot with deductible, if any, in an amount acceptable to City, naming City as loss payee as its interests may appear.
42 (g) Insurance Providers. Companies writing the insurance required hereunder shall be licensed to do business in the State of California. Insurance shall be placed with insurers with a current A.M. Best’s rating of no less than A: VII. (h) Evidence of Insurance; Endorsements; Policies . From and after closing on each Lot of
the City Property, and through the Completion Date, Developer shall furnish City with certificates of insurance in form acceptable to City evidencing the insurance coverage required under paragraphs (a), (b), (c), and (e) above, duly executed endorsements evidencing the In demnitees’ status as additional insured, and all other endorsements and coverage required hereunder pertaining to such coverage. Prior to the Commencement Date, Developer shall furnish City with certificates of insurance and endorsements in form acceptabl e to City evidencing the insurance coverage required under paragraph (d) above.
All insurance certificates shall contain a statement of obligation on the part of the carrier to notify City of any material adverse change, cancellation, termination or no n-renewal of the coverage at least thirty (30) days in advance of the effective date of any such material adverse change, cancellation, termination or non -renewal. Upon City’s request, Developer shall, within thirty (30) days of the request, provide or ar range for the insurer to provide to City, complete certified copies of all insurance policies required under this Agreement. City’s failure to make such request shall not constitute a waiver of the right to require delivery of the policies in the future.
(i) Reinstatement. If any insurance policy or coverage required hereunder is canceled or reduced, Developer shall, within five (5) days after receipt of notice of such cancellation or reduction in coverage, but in no event later than the effective date of cancellation or reduction, file with City a certificate showing that the required insurance has been reinstated or provided through another insurance company or companies. Upon failure to so file such certificate, City may, without further notice and at its option, procure such insurance coverage at Developer’s expense, and Developer shall promptly reimburse City for such expense upon receipt of billing from City.
(j) Primary Coverage; Waiver of Subrogation; Annual Aggregate Limits. All coverage shall be primary insurance and shall not be contributing with any insurance, or self insurance maintained by City, and the policies shall so provide. Each insurance policy shall contain a waiver of subrogation for the benefit of the City. If any of the required insurance is provided under a form of coverage that includes an annual aggreg ate limit or provides that claims investigation or legal defense costs are included in such annual aggregate limit, such annual aggregate limit shall be three times the occurrence limits specified above. (k) Deductibles/Retentions. Any deductibles or self-insured retentions shall be declared to, and be subject to the approval by, City’s Risk Manager, which approval shall not be unreasonably withheld, conditioned, or delayed. To the extent that payment of deductibles or self-insured retentions is required as a prerequisite to a defense or indemnity being provided by an insurance carrier, such shall be funded by Developer.
43 (l) Adjustments. The limits of the liability coverage and, if necessary, the terms and conditions of insurance, shall be reasonably adjusted from time to time (not less than every five (5) years after the Effective Date nor more than once in every three (3) year period) to address changes in circumstances that may include increases in the cost of construction that may impact builders’ risk or c asualty coverage(s). City shall give written notice to Developer of any such adjustments, and Developer shall provide City with amended or new insurance certificates or endorsements evidencing compliance with such adjustments within thirty (30) days follo wing receipt of such notice.
(m) Additional Insured Coverage; Liability Limits. For all liability insurance required by this Agreement, Developer (and Developer’s contractors, as applicable) shall obtain endorsements that name the Indemnitees as additional insured in the full amount of all applicable policies, notwithstanding any lesser minimum limits specified in this Agreement. This Agreement requires Developer (and Developer’s contractors) to obtain and provide for the benefit of the Indemnitees, additional insured coverage in the same amount of insurance carried by Developer (or Developer’s contractors, as a pplicable), but in no event less than the minimum amounts specified in this Agreement. In the event that Developer (or Developer’s contractors as applicable) obtains insurance policies that provide liability coverage in excess of the amounts specified in this Agreement, the actual limits provided by such policies shall be deemed to be the amounts required under this Agreement. Without limiting the foregoing, the limits of liability coverage specified in this Agreement are not intended, nor shall they operate, to limit City’s ability to recover amounts in excess of the minimum amounts specified in this Agreement.
Nothing contained in this Article X shall prohibit Developer from satisfying its insurance obligations by means of an Owner Controlled Insurance Program, provided that the coverage under such policy satisfies the minimum requirements herein and is approved by the City.
ARTICLE XI
MISCELLANEOUS PROVISIONS
11.1 No Brokers. Each Party warrants and represents to the other that no person or entity can properly claim a right to a real estate commission, brokerage fee, finder’s fee, or other compensation with respect to the transactions contemplated by this Agreement. Each Party agrees to defend, indemnify and hold harmless the other Party from any claims, expenses, costs or liabilities arising in connection with a breach of this warranty and representation. The terms of this Section shall survive the close of escrow and the expiration or earlier termination of this Agreement.
11.2 Enforced Delay; Extension of Times of Performance. The time for performance of provisions of this Agreement by either Party shall be extended for a period equal to the period of any delay directly affecting the Project or this Agreement which is caused by any of the following (“Force Majeure”): war, insurrection, strikes, lockouts or other labor disturbances, riots, floods, earthquakes, fires, casualties, acts of God, acts of a public enemy, epidemics, pandemics, quarantine restrictions, freight embargoes, lack of transportation, court order, suits or litigation filed by unrelated third parties concerning or arising out of this Agreement, provided the Party subject to such litigation is actively mounting a defense to such litigation; unusually severe weather
44 conditions; inability to secure necessary materials, provided that the Party claiming such as an event of Force Majeure has taken reasonable action to obtain such materials on a timely basis; delays resulting from changes in Applicable laws or the imposition of a development moratorium, as defined in section 66452.6(f) of the California Government Code; subject to the limitations set forth below, delays resulting from Economic Force Majeure or Hazardous Material Delay; and any other causes affecting the develop ment and/or construction of the Project which are beyond the reasonable control of the Party claiming any extension of time.
11.2.1 Notice; Duration of Force Majeure Delay . An extension of time for any of the above specified causes will be deemed gra nted only if written notice by the Party claiming such extension is sent to the other Party within sixty (60) calendar days after Developer obtains actual knowledge of the commencement of the cause. In the event that the period of Force Majeure exceeds twelve (12) months, City and Developer shall meet and confer in good faith regularly for the duration of the event to discuss mutually acceptable changes to the Project that will allow development of the Project to proceed to the extent possible notwithstand ing the event or events causing such Force Majeure.
11.2.2 Economic Force Majeure; Hazardous Material Delay. “Economic Force Majeure” means a significant decline in the real estate market during the preceding twelve (12) month period, measured on a quarterly basis. Economic Force Majeure shall commence upon Developer’s delivery of written notice to City of the Ec onomic Force Majeure (together with appropriate backup evidence). Economic Force Majeure shall continue prospectively on a quarterly basis and remain in effect until the commercial real estate market increases for three (3) successive quarters during the preceding twelve (12) month period; provided that the cumulative total Economic Force Majeure shall not exceed thirty six (36) months.
City and Developer acknowledge that, with the exception of Economic Force Majeure as defined above, adverse changes in economic conditions, either of the affected Party specifically or the economy generally, changes in market conditions or demand, and/or inability to obtain financing to complete the Project shall not constitute grounds of Force Majeure pursuant to this Section. Each Party expressly assumes the risk of such adverse economic or market changes and/or financial inability (not constituting Economic Force Majeure), whether or not foreseeable as of the Effective Date. Without limiting the generality of the foregoing, Developer’s inability or failure to obtain financing shall not be deemed to be a cause outside the reasonable control of the Developer and shall not be the basis for an excused delay unless such inability, failure, or delay is a result of Economic Force Majeure or another event of Force Majeure.
“Hazardous Material Delay ” means delay caused by (1) the req uirement by an environmental regulatory agency to perform investigation or remedial action beyond the segregation, characterization and proper disposal (including reuse) required by any applicable Site Management Plan for any Hazardous Materials (A) not pr eviously identified at the City Property (based on information included in the Hazardous Materials documents obtained by Developer prior to the Effective Date), (B) previously identified at the City Property , but that are encountered in a previously unidentified location or in concentrations in excess of those previously identified (each 45 based on information included in the Hazardous Materials documents obtained by Developer prior to the Effective Date), or (C) encountered in the construction of any off -site infrastructure or other improvements and not previously identified at the Property as described in clause (A) or clause (B) preceding; (2) the requirement by an environmental regulatory agency to perform investigation or remedial action for Hazardous Mat erials beyond the preparation of work plans for additional sampling or investigation, the implementation of such approved work plans and the preparation of closure reports necessary to address or obtain closure for non-CERCLA Hazardous Materials located at the City Property to the extent such investigation or remedial action is necessary to permit the uses identified in the Development Agreement; or (3) the requirement by and environmental regulatory agency to perform investigation or remedial action for Hazardous Materials that are the result of any additional remediation required at a formerly closed site by any regulatory agency due to resolution in accordance with Applicable Law by any regulatory agency of the applied remediation strategy or any change in law or regulation related to remediation standards, including without limitation any change in risk screening levels.
11.2.3 Agreement to Extend Time of Performance . Times of performance under this Agreement may also be extended in writing by the mutual agreement of Developer and City (acting in the discretion of the Authorized Representative unless he or she determines in his or her discretion to refer such matter to the City Council).
11.3 Notices. Except as otherwise specified in this Agree ment, all notices to be sent pursuant to this Agreement or any other City Document shall be made in writing, and sent to the Parties at their respective addresses specified below or to such other address as a Party may designate by written notice delivered to the other Parties in accordance with this Section. All such notices shall be sent by: (i) personal delivery, in which case notice is effective upon delivery; (ii) certified or registered mail, return receipt requested, in which case notice shall be deemed delivered on receipt if delivery is confirmed by a return receipt; or (iii) nationally recognized overnight courier, with charges prepaid or charged to the sender’s account, in which case notice is effective on delivery if delivery is confirmed by the delivery service.
City:
City of Santa Maria
110 E. Cook
Santa Maria, CA 93454
Attention: City Manager
Copy to:
City of Santa Maria
204 E. Cook
Santa Maria, CA 93454
Attention: City Attorney
Developer:
VERNON Property Group, LLC,
706 East Haley
Santa Barbara, CA 93103
46 Copy to:
Robert Forouzandeh, Esq.
Reicker Pfau Pyle & McRoy, LLP
1421 State Street, Suite B
Santa Barbara, CA 93101
11.4 Attorneys’ Fees. If either Party fails to perform any of its obligations under this Agreement, or if any dispute arises between the Parties concerning the meaning or interpretation of any provision hereof, then the prevailing Party in any proceeding in connection with su ch dispute shall be entitled to the reasonable costs and expenses it incurs on account thereof and in enforcing or establishing its rights hereunder, including, without limitation, court costs and reasonable attorneys’ fees and disbursements, whether such action sounds in tort or contract, and irrespective of whether the action proceeds to final judgment.
11.5 Waivers; Modification. No waiver of any breach of any covenant or provision of this Agreement shall be deemed a waiver of any other covenant or provision hereof, and no waiver shall be valid unless in writing and executed by the waiving Party. An extension of time for performance of any obligation or act shall not be deemed an extension of the time for performance of any other obligation or act, and no extension shall be valid unless in writing and executed by the Party granting the extension. This Agreement may be amended or modified only by a written instrument executed by the Parties. For purposes of the City, any modification need not be approved by the City Council but may instead be approved at the City staff level.
11.6 Binding on Successors. Subject to the restrictions on Transfers set forth in Article VII, this Agreement shall bind and inure to the benefit of the Parties and their respective permitted successors and assigns. Any reference in this Agreement to a specifically named Party shall be deemed to apply to any permitted successor and assign of such Party who has acquired an interest in compliance with this Agreement or under law.
11.7 Survival. All representations made by Developer hereunder, Developer’s obligations pursuant to Sections 5.11, 5.14, 5.15, 6.1, 6.5, 6.7, 10.1 and 11.1, and City’s rights under Section 9.8 and 9.9 , and all other provisions that expressly so state, shall survive the expiration or termination of this Agreement. Except as otherwise expressly provided in this Agreement, Developer’s obligations under this Agreement s hall cease to be effective at such time as Developer is entitled to the issuance of the Certificate of Completion.
11.8 Headings; Interpretation; Statutory References. The section headings and captions used herein are solely for convenience and shall not be used to interpret this Agreement. The Parties acknowledge that this Agreement is the product of negotiation and compromise on the part of both Parties, and the Parties agree, that since both Parties have participated in the negotiation and drafting of this Agreement, this Agreement shall not be construed as if prepared by one of the Parties, but rather according to its fair meaning as a whole, as if both Parties had prepared it. All references in the City Documents to particular statutes, regulations, ordinances or resolutions of the United States, the State of California, or the City of Santa Maria shall be deemed to include the same statute, 47 regulation, ordinance or resolution as hereafter amended or renumbered, or if repealed, to such other provisions as may thereafter govern the same subject.
11.9 Action or Approval. Whenever action and/or approval by City is required under this Agreement, the City’s Authorized Representative or his or her designee may act on and/or approve such matter unle ss specifically provided otherwise, or unless the Authorized Representative determines in his or her discretion that such action or approval requires referral to the City Council for consideration.
11.10 Entire Agreement. This Agreement, including Exhibits A through E attached hereto and incorporated herein by this reference, together with the other City Documents, contains the entire agreement between the Parties with respect to the subject matter hereof, and supersedes all prior written or oral ag reements, understandings, representations or statements between the Parties with respect to the subject matter hereof. If the Exhibits to this Agreement are inconsistent with this Agreement, the more restrictive requirements shall control, as determined by the City’s Authorized Representative. In the event of a conflict between this Agreement and the other City Documents, the more restrictive requirements shall control, as determined by the Authorized Representative.
11.11 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be an original and all of which taken together shall constitute one instrument. The signature page of any counterpart may be detached therefrom without impairing the legal effect of the signature(s) thereon provided such signature page is attached to any other counterpart identical thereto having additional signature pages executed by the other Party. Any executed counterpart of this Agreement may be delivered to the other Party by facsimile and shall be deemed as binding as if an originally signed counterpart was delivered.
11.12 Severability. If any term, provision, or condition of this Agreement is held by a court of competent jurisdiction to be invalid or unenforceable, the remainder o f this Agreement shall continue in full force and effect unless an essential purpose of this Agreement is defeated by such invalidity or unenforceability.
11.13 No Third-Party Beneficiaries. Except as expressly set forth herein, nothing contained in this Agreement is intended to or shall be deemed to confer upon any person, other than the Parties and their respective successors and assigns, any rights or remedies hereunder.
11.14 Parties Not Co-Venturers; Independent Contractor; No Agency Relationship. Nothing in this Agreement is intended to or shall establish the Parties as partners, co-venturers, or principal and agent with one another. The relationship of Developer and City is and shall remain solely that of a buyer and seller, and shall not be con strued as a joint venture, equity venture, partnership or any other relationship. City neither undertakes nor assumes any responsibility or duty to Developer (except as expressly provided in this Agreement) or to any third party with respect to the Project or the City financing described herein. Developer and its employees are not employees of City but rather are and shall always be considered independent contractors. Furthermore, Developer and its employees shall at no time hold themselves out as employees or agents of City. Except as City may specify in writing, Developer shall not have any authority to act as an agent of City or to bind City to any obligation.
48 11.15 Time of the Essence; Calculation of Time Periods. Time is of the essence for ea ch condition, term, obligation and provision of this Agreement. Unless otherwise specified, in computing any period of time described in this Agreement, the day of the act or event after which the designated period of time begins to run is not to be inclu ded and the last day of the period so computed is to be included, unless such last day is not a business day, in which event the period shall run until the next business day. The final day of any such period shall be deemed to end at 5:00 p.m., local time at the Property. For purposes of this Agreement, a “business day” means a day that is not a Saturday, Sunday, a federal holiday or a state holiday under the laws of the State of California.
11.16 Governing Law; Venue. This Agreement shall be governe d by and construed in accordance with the laws of the State of California without regard to principles of conflicts of laws.
Any action to enforce or interpret this Agreement shall be filed and heard in the Superior Court of Santa Barbara County, Californ ia or in the Federal District Court for the Central District of California.
11.17 Maintenance and Inspection of Books and Records. Developer shall keep and maintain at the Property or elsewhere with City’s consent, full, complete, and adequate books, records and accounts relating to the Project, including such books, records, and accounts necessary to document Developer’s compliance with this Agreement and the City Documents.
11.18 Political Activity. None of the materials, property or services provided by City to Developer under this Agreement shall be used for any partisan political activity or the election or defeat of any candidate for public office.
11.19 Non-Liability of City Officials, Employees and Agents . No member, official, employee or agent of the City shall be personally liable to the Developer in the event of any default or breach by the City or for any amount which may become due to the Developer or its successor or on any obligation under the terms of this Agreement.
11.20 Conflict of Interest.
(a) Except for approved eligible administrative or personnel costs, no person described in subsection (b) below who exercises or has exercised any functions or responsibilities with respect to the activities funded pursuant to this Agreement or who is in a position to participate in a decision- making process or gain inside information with regard to such activities, may obtain a personal or financial interest or benefit from the activity, or have an interest in any contract, subcontract or agreement with respect thereto, or the proceeds thereunder, either for themselves or those with whom they have family or business ties, during, or at any time after, such person’s tenure. The Developer shall exercise due diligence to ensure that the prohibition in this Section is followed. (b) In accordance with Government Code Section 1090 and the Political Reform Act, Government Code Section 87100 et seq., no person who is a director, officer, partner, tru stee or employee or consultant of Developer, or immediate family member of any of the preceding, shall make or participate in a decision, made by the City or a City board, commission or committee, if it is reasonably foreseeable that the decision will have a material effect on any source of income, investment or interest in real property of that person or the Developer. Interpretation of this Section 49 shall be governed by the definitions and provisions used in the Political Reform Act, Government Code Section 87100 et seq., its implementing regulations manual and codes, and Government Code Section 1090.
SIGNATURES ON FOLLOWING PAGES.
50 IN WITNESS WHEREOF, the Parties have entered into this Agreement effective as of the date first written above.
DEVELOPER:
VERNON Property Group, LLC,
a California limited liability company
___________________________________
By: Brett Vernon
Its: President
CITY:
City of Santa Maria, a municipal corporation
By: _______________________________
Alex Posada, City Manager
APPROVED AS TO FORM:
______________________________
Thomas Watson, City Attorney
Exhibit A-1
Legal Description – Lot 1
A part of Parcel 1 of Parcel Map Towncenter West II Parcel Map Tract 5522, recorded July 26, 1988, in Book 41 of Parcel Maps at pages 90 through 94, Santa Barbara County Records.
Described as the following:
Beginning at the Northwesterly corner of Parcel 7 of said Parcel Map; thence North 89° 31’ 09" West a distance of 300.60 feet along said northerly line of said Parcel; thence South 0° 9’ 30" West a distance of 151.42 feet;
thence along a curve to the right, with a radius of 94.00 feet, an arc length of 5.21 feet, through a central angle of 3°10' 26'';
thence along a curve to the left, with a radius of 106.00 feet, an arc length of 36.91 feet, through a central angle of 19°56' 56'';
thence South 0° 9’ 30" West a distance of 60.00 feet;
thence along a curve to the left, with a radius of 56.00 feet, an arc length of 22.55 feet, through a central angle of 23°04' 24'';
thence along a curve to the right, with a radius of 94.00 feet, an arc length of 10.33 feet, through a central angle of 06°17'57'';
thence South 0° 09’ 30" West a distance of 174.96 feet; thence North 89° 31’ 09" West a distance of 159.72 feet; thence North 44° 50’ 28" West a distance of 204.00 feet; thence along a curve to the left, with a radius of 14.50 feet, an arc length of 22.78 feet, through a central angle of 90°00'00'';
thence South 45° 09’ 32" West a distance of 107.35 feet; thence North 0° 08’ 49" East a distance of 200.06 feet; thence South 89° 30’ 59" East a distance of 100.18 feet; thence North 0° 17’ 14" East a distance of 200.33 feet, to the point of beginning.
(The developer/contractor is conditioned to prepare a more detailed legal description and physical survey upon application of a building permit, including setting property corners for the proposed lot.)
Exhibit A-2
Site Map – Lot 1
Exhibit A-3
Developers Representation and Project Description – Lot 1
Lot 1 – Town Center West Plaza
Project Shall Provide:
Number of Units and Square Footage
Up to 375 apartments, micro units, condominiums, or hotels, all of which will be subject to the same zoning conditions as apartments.
Architecture/Massing
Up to 7 story building from ground elevation that should incorporate parking, apartments and amenities to provide the highest and best use of the site. Commercial uses shall be located toward plaza areas, and used to minimize the garage parking façade
Plazas/Gathering spaces
Re-construction of Heritage Walk between Broadway and Lincoln Street Additional plaza areas between Heritage Walk and the Heritage Walk Lofts (former Fallas/Mervyn’s building)
Plaza area and pedestrian path connecting to the existing pedestrian bridge over Broadway Rehabilitation of Lincoln Street, including sidewalk repairs, new landscape and hardscape, and resurfacing of Lincoln Street
Ample use of landscaping, patios/gazebos, and appropriate furniture for sitting and gathering Vernon Group will contribute to and participate in future Downtown Property and Business Improvement District or other district for maintaining enhancements and improvements in Downtown
Commercial space
All ground floor for commercial, with exception to utility spaces, lobby for apartments Minimum 10,000 sq. ft. for commercial uses, including minim um 5,000 sq. ft. for bar/dining/food establishments
The use of commercial kiosks to activate paseos and plazas
Parking Concession
On-site parking to meet the D owntown Specific Plan minimum parking ratio for residential uses
Pedestrian connection to existing bridge providing access to Town Center parking garage Vernon Group will engage in negotiations and be party to a new negotiated Reciprocal Easement and Access Agreement (REA) for parking and access that will govern Town Center
Exhibit A-4
Legal Description – Lot 2
A part of Parcel 4 of Central Plaza Neighborhood Development Subdivision Tract 5077, recorded January 17, 1973, in Book 79 of Maps, at pages 55 through 60, Santa Barbara County Records.
Described as the following:
Beginning at the Northwesterly corner of Parcel 4 of said Map; thence South 89° 23’ 29" East a distance of 223.88 feet along said northerly line of said Parcel; thence South 0° 01’ 05" East a distance of 72.13 feet;
thence South 0° 38’ 23" West a distance of 144.01 feet; thence South 89° 37’ 05" West a distance of 209.36 feet; thence along a curve to the right, with a radius of 15.00 feet, an arc length of 23.82 feet, through a central angle of 90°59'26'';
thence North 0° 36’ 31" East a distance of 204.76 feet, to the point of beginning.
(The developer/contractor is conditioned to prepare a more detailed legal description and physical survey upon application of a building permit, including setting property corners for the proposed lot.)
Exhibit A-5
Site Map – Lot 2
Exhibit A-6
Developers Representation and Project Description – Lot 2
Lot 2 – Perlman Apartments
Project Shall Provide:
Number of Units and Square Footage
Up to 160 apartments
Architecture/Massing
Six-story building with five floors of apartments over raised podium parking and lobby
Plazas/Gathering spaces
Pedestrian connections along the north and east frontages of the proposed building, from Central Plaza park to the intersection of Main and Broadway Minimum 5,000 sq. ft. in landscaped courtyards for tenants Vernon Group will contribute to and participate in future Downtown Property and Business Improvement District or other district for maintaining enhancements and improvements in Downtown
Parking Concession
75 on-site parking spaces
City to provide remaining parking spaces in Santa Maria Town Center at a rate consistent with the Downtown Specific Plan minus the 75 on-site spaces
Vernon Group will engage in negotiations and be party to a new negotiated Reciprocal Easement and Access Agreement (REA) for parking and access that will govern Town Center
Affordability
(Consistent with the City’s authority and privileges in the Reciprocal Easement Agreement (REA) for Town Center)
Overall affordability of 60 percent of Area Median Income (AMI), and may include housing units at 80, 60, 50 and 30 percent AMI
All residential units, except for the manager’s unit, shall be income -restricted by deed for a minimum of 55 years
In order to facilitate the complexities and nuances associated with affordable housing finance, the City Manager is hereby empowered to authorize and approve a separate but related development agreement. This authorization is contingent upon the determinat ion by both the developers and affordable housing partners that such an agreement is necessary. The purpose of this provision is
to ensure that all financial and logistical aspects of affordable housing projects are comprehensively addressed, enabling the successful and timely completion of these projects.
Conditions for Authorization:
The City Manager’s authority to approve a related development agreement is subject to the following conditions:
1. Necessity: The developers and affordable housing partners mu st jointly determine that a separate agreement is essential to address specific financial or operational needs related to the affordable housing project.
2. Consistency: The proposed related development agreement must be consistent with the goals and objectives of the primary development agreement.
3. Transparency: All parties must ensure that the terms and conditions of the related development agreement are transparent and do not conflict with the primary agreement.
4. Approval Process: The related development agreement must undergo a thorough review process, including but not limited to legal, financial, and operational assessments, to ensure its viability and compliance with applicable regulations.
By including this provision, the parties acknowledge the importance of flexibility in addressing the unique challenges of affordable housing finance and commit to working collaboratively to achieve the project’s success.
Exhibit A-7
Legal Description – Lot 3
A part of Parcel 1 of Parcel Map Santa Maria Town Center East Parcel Map Tract 5561, recorded December 12, 1990, in Book 46 of Parcel Maps at pages 23 through 27, Santa Barbara County Records.
Described as the following:
Beginning at the Northwesterly corner of Parcel 1 of said Parcel Map; thence North 89° 37’ 05" East a distance of 190.00 feet along said northerly line of said Parcel; thence South 0° 23’ 38" West a distance of 95.00 feet;
thence South 89° 37’ 05" West a distance of 200.00 feet; thence North 0° 23’ 38" East a distance of 85.00 feet;
thence on a curve a distance of 15.57 feet, to the right, having a radius of 10.00 feet, to the point of beginning.
(The developer/contractor is conditioned to prepare a more detailed legal description and physical survey upon application of a building permit, including setting property corners for the proposed lot.)
Exhibit A-8
Site Map – Lot 3
Exhibit A-9
Developers Representation and Project Description – Lot 3
Lot 3 – Alvin Newton Apartments and Firefighters Memorial Project Shall Provide:
Number of Units and Square Footage
77-95 Apartments
4,500-11,000 SF of Commercial and Live/work.
Architecture/Massing
70 foot maximum height, six-story can be considered with eastward extension over existing driveway and connecting to parking garage (to avoid a narrow building mass that might not blend in with the adjacent structures)
Plazas/Gathering spaces
Minimum 2,000 sq. ft. ground floor outdoor patio seating open to public during business hours Roof-top patio/deck for apartment tenants only
Vernon Group will contribute to and participate in future Downtown Property and Business Improvement District or other district for maintaining enhancements and improvements in Downtown
Commercial space
All ground floor for commerc ial, including dining/food establishment(s), with exception to utility spaces, lobby for apartments
Signage/Monuments
Re-establish firefighters and four-corners memorials in coordination with stakeholders
Parking Concession
City to access to Santa Maria Town Center parking garage for use by both commercial and residential users of the Property
City to provide parking spaces in Santa Maria Town Center at a rate of 2 spaces per unit for the residential units at the Property
Vernon Group will engage in negotiations and be party to a new negotiated Reciprocal Easement and Access Agreement (REA) for parking and access that will govern Town Center
Infrastructure
City will fund, design, and install the following offsite infrastructure to the lot line at mutually agreed locations;
o Water supply and Offsite Hydrants
o Sewer supply
o Any regional drainage that is not required to be treated onsite stormwater. Developer will pay for any offsite upgrades to Electrical Infrastructure, Phone and Cable Systems, Natural Gas Infrastructure.
Exhibit A-10
Legal Description – Lot 4
A part of Parcels 19 through 28 of Thornburg’s Division recorded October, 1908, in Book 5 of Maps at pages 5 through 6, Santa Barbara County Records.
Described as the following:
Beginning at the Northwesterly corner of Parcel 19 of said Parcel Map; thence South 0° 42’ 26" West a distance of 144.65 feet along said westerly line of said Parcel;
thence South 89° 17’ 11" East a distance of 250.00 feet; thence North 0° 42’ 26" East a distance of 144.65 feet; thence North 89° 17’ 11" West a distance of 250.00 feet, to the point of beginning.
(The developer/contractor is conditioned to prepare a more detailed legal description and physical survey upon application of a building permit, including setting property corners for the proposed lot.)
Exhibit A-11
Site Map – Lot 4
Exhibit B-1
Performance Schedule and Incentives – Lot 1
Action Performance Target Incentive with Target Met
1. Submission of
Downtown Permit
application.
Before completion of projects
on Lot 2 and Lot 3, and no
later than 12/31/2026.
Waive 50% of Planning
application fees, including
Downtown Permit and
environmental clearance
fees.
2. Approval of
Downtown Permit
application.
Within 6 months of submittal
and determination of
complete Downtown Permit
application. This time period
shall be tolled at any time
that the application has been
submitted to the City until
such time as the application
is returned by the City to the
Developer.
3. Opening of escrow for
property.
Within 30 days of approval of
Downtown Permit
application.
Payment of $50,000 deposit
to the City for the property.
4. Submission of
construction
drawings, including
grading, landscaping,
and construction
plans.
Within 12 months after
Downtown Permit approval.
Waive 50% of all Building
plan check fees. Fees shall
be vested to date of
approval of SDA.
5. Approval of
construction
drawings, including
grading, landscaping,
and construction
plans for first phase
and issuance of
building permits.
Within 6 months after receipt
by the City. Developer's
deadline to perform shall be
tolled at any time that the
application has been
submitted to the City until
such time as the application
is returned by the City to the
Developer.
Waive 50% of growth
mitigation fees for City Hall,
Consolidated Corporation
Yard, Police, Fire, Traffic,
and Library.
6. Submission of
evidence
documenting equity
capital and financing.
30 days prior to the close of
escrow.
7. Acceptance of
evidence
documenting equity
capital and financing.
30 days prior to the close of
escrow.
8. Close of escrow for
property.
Upon completion of all
conditions to close escrow.
Payment of remaining
$70,000 of purchase price.
9. Commencement of
construction.
Within 30 days after
conveyance of the property
by the City to the Developer.
10. Completion of
construction and
issuance of
certification of
occupancy.
Within 36 months after
building permit issuance.
Waive remaining 50% of
growth mitigation fees for
City Hall, Consolidated
Corporation Yard, Police,
Fire, Traffic, and Library.
Exhibit B-2
Performance Schedule and Incentives – Lot 2
Action Performance Target Incentive with Target Met
1. Submission of
Downtown Permit
application.
Within 30 days after
execution of Development
Agreement.
Waive 50% of Planning
application fees, including
Downtown Permit and
environmental clearance
fees.
2. Approval of
Downtown Permit
application.
Within 6 months of submittal
and determination of
complete Downtown Permit
application. This time period
shall be tolled at any time
that the application has been
submitted to the City until
such time as the application
is returned by the City to the
Developer.
3. Opening of escrow for
property.
Within 30 days of approval of
Downtown Permit
application.
Payment of $50,000 deposit
to the City for the property.
4. Submission of
construction
drawings, including
grading, landscaping,
and construction
plans.
Within 12 months after
Downtown Permit approval.
Waive 50% of all Building
plan check fees. Fees shall
be vested to date of
approval of SDA.
5. Approval of
construction
drawings, including
grading, landscaping,
and construction
plans for first phase
and issuance of
building permits.
Within 6 months after receipt
by the City. Developer's
deadline to perform shall be
tolled at any time that the
application has been
submitted to the City until
such time as the application
is returned by the City to the
Developer.
Waive 50% of growth
mitigation fees for City Hall,
Consolidated Corporation
Yard, Police, Fire, Traffic,
and Library.
6. Submission of
evidence
documenting equity
capital and financing.
30 days prior to the close of
escrow.
7. Acceptance of
evidence
documenting equity
capital and financing.
30 days prior to the close of
escrow.
8. Close of escrow for
property.
Upon completion of all
conditions to close escrow.
Payment of remaining
$70,000 of purchase price.
9. Commencement of
construction.
Within 30 days after
conveyance of the property
by the City to the Developer.
10. Completion of
construction and
issuance of
certification of
occupancy.
Within 36 months after
building permit issuance.
Waive remaining 50% of
growth mitigation fees for
City Hall, Consolidated
Corporation Yard, Police,
Fire, Traffic, Library.
Exhibit B-3
Performance Schedule and Incentives – Lot 3
Action Action Performance Target Incentive with Target Met
1. Execution of
Development
Agreement, including
Phasing Plan, between
Developer and City.
Not later than 6 months after
entering exclusive
negotiating agreement.
2. Submission of
Downtown Permit
application.
Within 30 days after
execution of Development
Agreement.
Waive 50% of Planning
application fees, including
Downtown Permit and
environmental clearance
fees ($6,935 of $13,869,
subject to change).
3. Approval of Downtown
Permit application.
Within 6 months of submittal
and determination of
complete Downtown Permit
application. This time period
shall be tolled at any time
that the application has been
submitted to the City until
such time as the application
is returned by the City to the
Developer.
4. Submission of evidence
documenting equity
capital and financing.
30 days prior to the close of
escrow.
5. Acceptance of evidence
documenting equity
capital and financing.
30 days prior to the close of
escrow.
6. Opening of escrow for
property.
Within 30 days of approval of
Downtown Permit
application.
Payment of $50,000 deposit
to the City for the property.
7. Submission of
construction drawings,
including grading,
landscaping, and
construction plans.
Within 6 months after
Downtown Permit approval.
Waive 50% of all Building
plan check fees ($127,075
of $254,149, subject to
change).
8. Approval of construction
drawings, including
grading, landscaping,
and construction plans
for first phase and
issuance of building
permits.
Within 4 months after receipt
by the City. Developer's
deadline to perform shall be
tolled at any time that the
application has been
submitted to the City until
such time as the application
is returned by the City to the
Developer.
Waive 50% of growth
mitigation fees for City Hall,
Consolidated Corporation
Yard, Police, Fire, Traffic,
and Library ($194,966 of
$389,932, subject to
change).
9. Close of escrow for
property.
Upon completion of all
conditions to close escrow.
Payment of remaining
$190,000 of purchase price.
10. Commencement of
construction.
Within 30 days after
conveyance of the property
by the City to the Developer.
11. Completion of
construction and
issuance of certification
of occupancy.
Within 36 months after
building permit issuance.
1.Refund $120,000 of the
purchase price of the
property to Developer.
2. Refund of 50% of the
cost of public improvements
performed on Lot 3 up to a
maximum refund of
$400,000.
3. Refund of the remaining
50% of the cost of public
improvements performed on
Lot 3 up to a maximum
amount of an additional
$400,000 upon
commencement of
construction by Developer
on Lot 1.
4. Waive remaining 50% of
growth mitigation fees for
City Hall, Consolidated
Corporation Yard, Police,
Fire, Traffic, and Library.
Exhibit E
Form Certificate of Completion
RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO:
_____________________________________________________________________________ (Space above line for Recorder’s use only)
APN:
EXEMPT FROM RECORDING FEES PER
CAL. GOVN’T CODE §§ 6103 and 27383
The undersigned grantor(s) declare(s):
Documentary Transfer Tax is: $0.00
( ) computed on full value of property conveyed, or
( ) computed on full value of less of liens and encumbrances remaining at time of sale. ( ) unincorporated area: ( x ) City of Santa Maria
CERTIFICATE OF COMPLETION
This Certificate of Completion (this “ Certificate”) is made by the City of Santa Maria, a California municipal corporation (“City”) effective as of __________ ___, 20___.
A. City and VERNON Enterprises LLC, a California limited liability company (“Developer”), entered into that certain Sales and Disposition Agreement dated as of __________ ___, 20___. (the “SDA”) concerning the development of certain real property located in the City of Santa Maria, Santa Barbara County, California and more particularly described in Exhibit A attached hereto (the “Property”). A Memorandum of the SDA was recorded in the Official Records of Santa Barbara County (“ Official Records ”) on __________ ___, 20___, as Instrument No. ____ , Capitalized terms used herein without definition shall have the meaning ascribed to such terms in the DDA
B. Pursuant to Section 5.12 of the SDA, the City is required to furnish the Developer or its successors with a Certificate of Completion upon completion of development of the Project in accordance with the SDA.
C. The City has determined that the development of the Project has been satisfactorily completed in accordance with the SDA.
NOW, THEREFORE, City hereby certifies as follows: