COMMUNITY REDEVELOPMENTr
CITY/AGENCY LOAN AGREEMENT
SAN JUAN CAPISTRANO CENTRAL REDEVELOPMENT PROJECT
THIS AGREEMENT is entered into this 6th day of October, 1998, by and between
the SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, a public body,
corporate and politic (the "Agency"), and the CITY OF SAN JUAN CAPISTRANO, a municipal
corporation (the "City").
RECITALS:
A. By Ordinance No. 488, adopted July 12, 1983, Ordinance No. 509 adopted
May 15, 1984, Ordinance No. 547, adopted on July 16,1985, and Ordinance Nos. 582-583 adopted
on August 19, 1986, the City Council of the City of San Juan Capistrano (the "City Council')
approved and amended the Redevelopment Plan (the "Plan") for the San Juan Capistrano
Redevelopment Proj ect (The "Project Area") ofthe San Juan Capistrano Community Redevelopment
Agency (the "Agency").
B. Pursuant to the Community Redevelopment Law of the State of California
(Health and Safety Code Section 3300 et. sea., the Agency is carrying out the Redevelopment Plan
for the Project in the redevelopment project area (the "Project Area").
C. Agency needs funds to acquire certain property within the Central
Redevelopment Project Area in order to facilitate the goals of the Redevelopment Plan.
D. The Agency has determined by resolution inability to allocate the full amount
required and the City and the Agency desire to enter into agreement , r which the City will loan
to the Agency an amount not to exceed $400,000.00.
AGREEMENT
The Agency and the City hereby agree as follows �
'V-,
Loan. The City loan to the Agency the amour, not to exceed Four
Hundred Thousand Dollars ($400,000.00) (the "Loan Amount')., which the Agency shall use as
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down payment for the purchase of Trulis Property. Agency shall issue a Promissory Note provided
as Attachment 1 and incorporated herein to this Agreement.
2. Repayment by the Agency. The Agency shall repay to the City the Loan
Amount, plus interest at the average rate earned by the City investments during the term of this loan
all due and payable upon the sale for the Lower Rosan Ranch property.
3. Indebtedness of Agency This Agreement constitutes an indebtedness of
the Agency incurred carrying out the Project, and a pledging of tax allocations from the Project to
repay such indebtedness, under the provisions of Section 16 of Article XVI of the California
Constitution and Section 33670-33674 of the Health and Safety Code; provide, however, that such
pledge of tax allocations shall always be subordinate and subject to the right of the Agency pledge
or commit tax allocations from the Project to repay bonds or other indebtedness incurred by the
Agency in carrying out the Project.
IN WITNESS WHEREOF, the Agency and the City have executed this Agreement
as of the date first above written.
ATTEST:
SAN JUAN CAPISTRANO COMMUNITY
REDEVELOPMENT AGENCY
i
� ��' By:
gency Sec ary
ATTEST:
a
Executive Director
CITY OF SAN JUAN CAPISTRANO
ok" By:
City Clerk
APPROVED AS TO FORM
John S City Attorney
2—
pro tem
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PROMISSORY NOTE SECURED BY DEED OF TRUST
San Juan Capistrano, California
&706FA2- t, 11998
The undersigned, SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT
AGENCY, a public body corporate and politic created under the laws of the State of California
('Borrower"), promises to pay to the order of the CITY OF SAN JUAN CAPISTRANO, a municipal
corporation organized and existing under the laws of the State of California ("Lender"), at 32400
Paseo Adelanto, San Juan Capistrano, California, or at such other place as may be designate in
writing by Lender, the principal sum of (amount, not to exceed $400,000) DOLLARS with interest
at the average rate earned by the City investment over the term of the note. Interest shall be due and
payable in one installment on the Maturity Date (as hereinafter defined).
The outstanding principal balance ofthis note, together with any accrued and unpaid interest,
shall be due and payable in one installment on or before the tenth anniversary date of the note
("Maturity Date"). Notwithstanding the foregoing sentence, the principal balance of this note,
together with accrued and unpaid interest, is payable at any time upon demand by Lender. All sums
owing hereunder are payable in lawful money of the United States of America. All or any portion
of the principal balance of this note may be prepaid at any time without penalty or premium.
In the event any payments are made by the Borrower in payment of the note, such payments
shall be applied first to the interest then accrued and due on the unpaid principal balance under this
note, and the remainder of any such payment shall be applied to the reduction of the unpaid principal
balance under this note, and the remainder of any such payments shall be applied to the reduction
of the unpaid principal.
Neither, this note nor any term hereof may be waived, amended, discharged, modified,
changed or terminated orally nor shall any waiver of any provision thereof be effective except by
any instrument in writing signed by the Borrower and the Lender hereof. No delay or omission on
the part of the Lender hereof in exercising any right hereunder shall operate as a waiver of such a
right or of any right under this note.
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Promissory Note
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Page 2
This note shall be construed according to and governed by the Laws of the State of California
and the parties hereto agree to submit to the jurisdiction of the courts of the State of California in the
event any litigation arises concerning the terms of this note.
"Borrower"
SAN JUAN CAPISTRANO COMMUNITY
REDEVELOPMENT AGENCY, a public
body corporate and politic created under the
laws of the State of California.
ATTEST
Agency Secr ary
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a
B
m
San Juan Capistrano
Community
Redevelopment
Agency
October 12, 1998
Mr. Tom Trulis
P. O. Box 1100
San Juan Capistrano, California 92693
Re: First Amendment to Exchanae Agreement
Dear Mr. Trulis:
At their meeting of October 6, 1998, the San Juan Capistrano Community Redevelopment
Agency Board of Directors adopted Resolution No. CRA 98-10-6-1, which approved the
First Amendment to the Agreement for Exchange of Real Property to provide for the
outright purchase of your property in the Los Rios District. A copy of Resolution No. CRA
98-10-6-1 and an originally -signed copy of the First Amendment are enclosed for your files.
In conjunction with this action, the City Council and the Community Redevelopment Agency
both approved a Loan Agreement and Promissory Note to fund the $400,000 down
payment on your Los Rios property. A copy of Resolution No. 98-10-6-2 and Resolution
No. CRA 98-10-6-2, setting forth that action, are also enclosed for your information.
Please feel free to contact Douglas Dumhart at 443-6316 if you have any questions.
Very truly yours,
Cheryl Johns
Agency Secretary
Enclosures
cc: Roger Grable
Douglas Dumhart
Finance Officer
32400 Pasco Adclanto
San Juan Capistrano
California 92675
714 -493 1171
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it wcs moved by Coamci 1 r Swerdlin, seconded b% Council Member Greiner and
unanimously carried to approve the rcc ded criteria to evaivate the proposals; to
endorse the recommended review process; toestablls b -committee and select Council
Member Hart and Mayor Jones to serve on the committee; an � thorize the Mayor to
appoint two Cultural Heritage Commission members to serve on the com e.
3. ADOPTION OF RESOLUTION APPROVING LOAN AGREEMENT WITH
COMMUNITY REDEVELOPMENT AGENCY AND ACCOMPANYING
PROMISSORY NOTE (TRULIS PROPr;R T Y. PARCEL 5 OF PARCEL MAP 92-
123) (600.30)
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Mayor Jones advised he would abstain on this item due to a conflict of interest relating to its
proximity to his business/residence.
Written Communications:
Report dated October 6, 1998, from the Senior Management Analyst II, forwarding a
proposed loan agreement with the Community Redevelopment Agency to lend the Agency
the $400,000 down payment for its purchase of Tom Trulis' Los Rios property, known as
Parcel 5 of Parcel Map 92-123. The report advised that in 1990 Mr. Trulis and the Agency
entered into an agreement to exchange 6 acres owned by the Agency, known as a portion of
the Lov er Rosan Ranch, for 2 acres owned by ,Mr. Trulis in the Los Rios District, in order
to facilitate the move of Mr. Trulis' business, Solag Disposal, out of the Los Rios area.
Since that time, Mr. Trulis had obtained a site on the Rancho Santa Margarita property in the
County unincorporated area off Ortega Highway and had relocated the majority of his
operations to that site. Mr. Trulis no longer needed the Lower Rosan site, but did need funds
to develop the new site. Agency staff proposed outright purchase of the Los Rios property.
The Loan will be repaid when the current suspension on certain building permits during the
General Plan update has been lifted and the Lower Rosan Ranch site has been sold.
The Senior Management Analyst II made an oral presentation.
Adoption of Resolution Approving Loan Agreement:
It was moved by Council Member Swerdlin and seconded by Council Member Hart to adopt
the following resolution:
RESOLUTION NO. 98-10-6-2, APPROVING THE EXECUTION AND
DELIVERY OF A LOAN AGREEMENT - A RESOLUTION OF THE CITY
COUNCIL OF THE CITY OF SAN JUAN CAPISTRANO, CALIFORNIA,
APPROVING A LOAN AGREEMENT BETWEEN THE CITY OF SAN
JUAN CAPISTRANO AND THE SAN JUAN CAPISTRANO
COMMUNITY REDEVELOPMENT AGENCY (TRULIS/PARCEL 5,
PARCEL MAP 92-123)
The motion carried by the following vote:
City Council Minutes -7- 10/6/98
5.
AYES: Council members S%ccrdlin. Greiner. I tart -id Campbell
NOES: None
ABSENT: None
ABSTAIN: Mayor Jones
POSITION OF OPPOSITION TO PROPOSITION 5 ON THE NOVEMBER, 1998
BALLOT - THE INDIAN CASINO GAMBLING INITIATIVE (630.30/910.601
port dated October 6, 1998, from the City Manager, recommending that the City oppose
Pro osition 5. The Report stated that the Proposition would require the Governor to "rubber
Stam " any casino proposed by an Indian tribe, which would eliminate any meaningful
involve ent of the Governor and eliminate the State's ability to insure that the proposed
casino w6VId not damage the public safety and welfare.
The City Man er made an oral presentation.
Opposition to Pro ition 5:
It was moved by Co cil Member Campbell. seconded by Council Member Hart, and
unanimously carried to ose Proposition 5, the Indian Casino Gamb:;rtg Initiative.
Written Communications:
Report dated October 6, 1998, from t\theoposition
nager, recommending that the City oppose
Proposition 9. The Report stated thawould harm California's economic
recovery by dismantling the State's eompetitive electric marketplace, eliminate
competition and customer choice, and if passed Nculd require taxpayers to be responsible
for repaying $6 billion in bonds that were sold by p vate parties.
The Assistant City Manager, made an oral presentation.
Public Input:
Mark Gaughan, representing San Diego Gas & Electric, noted tha any groups had studied
the initiative and had taken positions of opposition; further, that the oposition appeared to
have a negative impact on many individuals and organizations.
Council Comments
Council Member Swerdlin stated that while he did not necessarily support th\CitTitng
ion.
he did not support the de -regulation as it was set up and did not support the a
position in opposition to the Proposition.
City Council Minutes -8-
10/6/98
AGENDA ITEM
TO: George Scarborough, City Manager
FROM: Douglas D. Dumhart, Senior Management Analyst II
October 6, 1998
SUBJECT: Consideration of Resolution Approving the Execution of a Loan Agreement
and Accompanying Promissory Note by and between the City and
Redevelopment Agency (Trulis Property 5 of Parcel 92-123).
RECOMMENDATION:
By motion, adopt the Resolution approving the execution of a Loan Agreement efvd
by and between the City and Redevelopment Agency.
SUMMARY:
On the Agency agenda this evening was the consideration of a First Amendment to the
Exchange Agreement with Mr. Trulis for his Los Rios property. In 1990, the
Redevelopment Agency negotiated an exchange of properties in an attempt to acquire his
Los Rios property. The property swap has been unsuccessful in completing the property
acquisition. Staff has negotiated an Amendment to the Exchange Agreement which
abandons the land exchange in lieu of an outright purchase.
The purchase price is $1.2 million. The amendment calls for a $400,000 down payment
and a $800,000 promissory note for 5 years. The Redevelopment Agency does not have
sufficient funds to deposit the $400,000 down payment into escrow. Staff is proposing the
City loan the Agency the down payment until the Agency is able to dispose of the Lower
Rosan Ranch property. Staff has prepared a resolution approving the Loan Agreement
and an accompanying Promissory Note for City Council action.
BACKGROUND:
Tom and Jasmine Trulis and the Agency entered an Agreement for the Exchange of Real
Property, effective March 6, 1990, for the exchange of approximately two (2) acres of
property owned by Tom and Jasmine Trulis, as tenants-in-common, for approximately six
(6) acres of real property owned by the Agency, commonly known as a portion of the Lower
Rosan Ranch. The intent of the exchange was to provide Trulis' business, Solag Disposal,
which occupied the Los Rios property, a site in which to relocate. Opposition to the Solag
use on Lower Rosan Ranch led to Trulis securing a site on Rancho Santa Margarita
property in the County unincorporated area off Ortega Highway.
FOR CITU ('OUNCIL AGENT
NI C
Agenda Item -2- October 6, 1998
Mr. Trulis completed the development of his corporate yard in 1996 and relocated the
majority of his operations to the site. The storage of roll -off containers and the transfer of
"rent -me" bins is still being conducted on the Los Rios site. Mr. Trulis no longer has the
need for the six acres at Lower Rosan Ranch but, rather a monetary need given the
development cost of the new yard.
Furthermore, the City is anticipating the construction of the Paseo Adelanto extension north
to Ramos Street. The lingering acquisition of the Trulis parcel and its continued use
provides logistical complications to the Adelanto extension. To address current matters and
to meet obligations of the City Council and of the Los Rios Precise Plan, staff has
recommended the outright purchase of Mr. Trulis' parcel. To that end, the Agency has
prepared a First Amendment to the existing March 1990 Exchange Agreement to purchase
the property.
To facilitate the First Amendment the Agency needs to borrow the $400,000 down
payment. The attached Promissory Note will repay the City the Loan amount, plus interest
at the average rate earned by the City investments, during the term of this loan all due and
payable upon the sale of the Lower Rosan Ranch Property.
COMMISSION/BOARD REVIEW AND RECOMMENDATIONS:
Not applicable.
FINANCIAL CONSIDERATIONS:
A real estate appraisal of Mr. Trulis' parcel was prepared on May 7, 1998 by Harry B.
Holzhauser and Associates. The property was appraised on its grandfathered use as the
highest and best use which yields a market value of $1,265,000. The First Amendment
sets a purchase price of $1,200,000 ($400,000 in cash deposit and an $800,000 five-year
note).
Staff is proposing that the Agency borrow the $400,000 cash deposit from the City and
budget the monthly installments at midyear. The loan from the City would be repaid when
the planning suspension is lifted and the Agency's property, Lower Rosan Ranch, can be
sold.
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Agenda Item
NOTIFICATION:
Tom Trulis
P.O. Box 1100
San Juan Capistrano, CA 92693
ALTERNATE ACTIONS:
-3-
0
October 6, 1998
Roger A. Grable
19100 Von Karman, 8th Floor
Irvine, CA 92623-9613
By motion, adopt the Resolution approving the execution of a Loan Agreement and
accompanying Promissory Note by and between the City and Redevelopment
Agency.
2. By motion, adopt the Resolution approving subject to the execution of a Loan
Agreement and accompanying Promissory Note by and between the City and
Redevelopment Agency subject to modifications.
3. By motion, continue the item and refer to staff for additional information.
RECOMMENDATION:
By motion, adopt the Resolution approving the execution of a Loan Agreement and
accompanying Promissory Note by and between the City and Redevelopment Agency.
Respectfully submitted,
Aac4l"a z zg-w��
DOUGLAS D. DUMHART
Senior Management Analyst II
Attachment 1. Resolution Approving Loan Agreement,
Loan Agreement and Promissory Note
C: \AGENDAS\ 1998\ 10-6 L OA N.AG I
RESOLUTION NC. 95-10-6-2
APPROVING THE EXECUTION AND DELIVERY OF A LOAN AGREEMENT
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN JUAN
CAPISTRANO, CALIFORNIA, APPROVING A LOAN AGREEMENT BETWEEN THE
CITY OF SAN JUAN CAPISTRANO AND THE SAN JUAN CAPISTRANO
COMMUNITY REDEVELOPMENT AGENCY (TRULI S/PARCEL 5, PARCEL MAP 92-
123)
WHEREAS, by Ordinance No. 488, adopted July 12, 1983, Ordinance No. 509 adopted May
15, 1984, Ordinance No. 547, adopted on July 16,1985, and Ordinance Nos. 582-583 adopted on August 19,
1986, the City Council of the City of San Juan Capistrano (the "City Council") approved and amended the
Redevelopment Plan (the "Plan") for the San Juan Capistrano Redevelopment Project (The "Project Area")
of the San Juan Capistrano Community Redevelopment Agency (the "Agency"); and,
WHEREAS, the Agency has the inability to meet its entire obligation for the purchase of
the Trulis Property.
NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of San Juan
Capistrano as follows:
SECTION 1.
The above recitals are true and correct.
SECTION 2.
The execution and delivery of the Loan Agreement and Promissory Note is in the best
interest of the Agency and will promote the public health, safety and welfare.
SECTION 3.
The Loan Agreement, attached hereto as Exhibit "A", is hereby approved. The Mayor pro
tem and City Manager are hereby authorized to execute the Loan Agreement on behalf of the City, together
with such changes thereto as are approved by the City Manager, execution thereof being conclusive evidence
of the City's approval of such changes.
PASSED, APPROVED, AND ADOPTED this 6th day of October
1998.
JOHN GREINER, MAYOR PRO TEM
ATTEST:
24"",Z ��
CITY CLERK
-I-
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss
CITY OF SAN JUAN CAPISTRANO )
1, CHERYL JOHNSON, City Clerk of the City of San Juan Capistrano, California, DO
HEREBY CERTIFY that the foregoing is a true and correct copy of Resolution No.
98-10-6-2 adopted by the City Council of the City of San Juan Capistrano, California, at a
regular meeting thereof held on the 6th dayof October , 1998, by the following vote:
AYES: Council Mcmbecs Swerdlin, Greiner, Hart and Campbell
NOES: None
ABSTAIN: Mayor Jones
ABSENT: None
(SEAL)
CHERYL JOHNS N, CITY CLERK
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