1985-0827_KAISER DEVELOPMENT CO_Participation Agreementq-ty 41
PARTICIPATION AGREEMENT
BY AND BETWEEN THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN JUAN CAPISTRANO
D
KAISER DEVELOPMENT COMPANY
A u 2S
41
TABLE OF CONTENTS
Page
I. SUBJECT OF AGREEMENT .......................... 1
A. Purpose of the Agreement ................. 1
B. Description of the Site .................. 2
C. Parties to the Agreement ................. 2
1. The Agency .......................... 2
2. The Participant ..................... 2
3. Prohibition Against Change in
Ownership, Management, and
Control of Participant .............. 3
II. ACQUISITION OF THE SITE ....................... 7
III. DEVELOPMENT OF THE SITE ....................... 7
A. Development According to Terms of Approval 7
B. Agency Assistance ........................ 8
IV. TIMING OF LAND USE PERMIT APPROVALS;
TERMINATION ................................... 14
V. OTHER PROVISIONS .............................. 15
A.
Obligation to Refrain from Discrimination
15
B.
Form of Nondiscrimination and Nonsegrega-
tion Clauses .............................
15
C.
Taxes, Assessments, Encumbrances and Liens
17
D.
Notices, Demands and Communications
Between the Parties ......................
17
E.
Conflict of Interest; Agency's or City's
Representatives Not Individually Liable ..
18
F.
Enforced Delay, Extensions of Times of
Performance ..............................
18
G.
Titles of Sections ........................
19
VI. DEFAULT, REMEDIES AND TERMINATION .............
19
A.
Defaults .................................
19
B.
Legal Actions ............................
20
C.
Specific Performance .....................
21
D.
Applicable Law ...........................
21
E.
Acceptance of Service of Process .........
21
F.
Rights and Remedies are Cumulative .......
22
G.
Inaction Not a Waiver of Default .........
22
H.
Counterparts .............................
23
I.
Entire Agreement, Waivers and Amendments;
Execution ................................
23
J.
Vested Rights ............................
23
(i)
PARTICIPATION AGREEMENT
THIS AGREEMENT is entered into on August 27, ,
1985, by and between the REDEVELOPMENT AGENCY OF THE CITY OF
SAN JUAN CAPISTRANO, a public body corporate and politic (the
"Agency"), and KAISER DEVELOPMENT COMPANY, a California
corporation, (the "Participant"). The Agency and the Partic-
ipant agree as follows:
I. SUBJECT OF AGREEMENT
A. Purpose of the Agreement
The purpose of this Agreement is to facilitate the
development of the Site (as defined herein) in accordance
with this Agreement. Specifically, the Participant shall
develop on the Site a business park consisting of a mix of
industrial, research and development and office and related
support uses, which shall hereafter be referred to as the
"Project," subject to Participant's receipt of general plan,
zoning and tentative tract map approvals from the City of San
Juan Capistrano (the "City") (collectively referred to as the
"Land Use Permits"). Such development of the Site will
further the purposes of the Community Redevelopment Law
(Health and Safety Code Section 33000 et seq.) and shall help
to effectuate the Redevelopment Plan for the Central
Redevelopment Project (the "Redevelopment Project").
Moreover, the construction of necessary flood control
improvements will be of benefit to the Project Area (the
"Project Area") of the Redevelopment Project. The provision
of business park development and infrastructure improvements
pursuant to this Agreement shall be consistent with the
General Plan of the City and will promote the public health,
safety, welfare and morals.
B. Description of the Site
The "Site" is all of the real property shown on the
Map of the Site, which is incorporated herein and attached
hereto as Attachment No. 1.
C. Parties to the Agreement
1. The Agency
The Agency is a public body, corporate and
politic, exercising governmental functions and powers,
organized and existing under the Community Redevelopment Law
of the State of California.
The principal office of the Agency is located
at 32400 Paseo Adelanto, San Juan Capistrano, California
92675. "Agency", as used in this Agreement, includes the
Redevelopment Agency of the City of San Juan Capistrano,
California, and any successor to its rights, powers and
responsibilities.
2. The Participant
Participant is a California corporation.
The address of the Participant for the purpose
of this Agreement is Kaiser Development Company, 2121 Palomar
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Airport Rd., Suite 201 P.O. Box 308, Carlsbad, California,
92008.
3. Prohibition Against Change in Ownership,
Management,_ and Control of Participant. Participant recog-
nizes that, in view of;
(a) the importance of the redevelopment of
the Site to the general welfare of the community;
(b) the substantial financing and other pub-
lic aids that have been made available by law and by the
government for the purpose of making such redevelopment
possible; and
(c) the fact that a change in ownership or
control of Participant or of a substantial part thereof,
or any other act or transaction involving or resulting
in a significant change in ownership or control of
Participant or the degree thereof, is for practical
purposes a transfer or disposition of the property then
owned by the Participant;
the qualifications and identities of Participant, and its
principals, are of particular concern to City and Agency. It
is because of those qualifications and identities that Agency
has entered into this Agreement with Participant. No volun-
tary or involuntary successor in interest of Participant
shall acquire any rights or powers under this Agreement
except set forth herein.
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Prior to the completion of (i) the mass grading of
the Site; (ii) the grading and construction of the access
road and bridge required for the development of the Site;
(iii) the installation and construction of utilities stubbed
to the perimeter of the Site; and (iv) the construction of
the Oso Creek flood control improvements ("Related
Improvements"), Participant shall not, except as expressly
permitted by this Section I.C.3., assign this Agreement or
sell, transfer, convey or assign (hereinafter "Transfer") the
whole or any part of the Site or the improvements on the Site
without the prior written approval of the Agency. This
prohibition shall not apply to any of the following:
(i) Any mortgage, deed of trust, sale and lease-
back or other form of conveyance required for any rea-
sonable method of financing the direct and indirect
costs, including financing costs, interest and commis-
sions, of acquiring, developing, leasing and operating
the improvements to be constructed on the Site and any
other expenditures necessary and appropriate to acquire,
develop, lease and operate the Site pursuant to this
Agreement.
(ii) The dedication of portions of the Site to the
City or other appropriate governmental agency, or the
granting of easements or permits, to facilitate the
development of the Site;
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(iii) The leasing of any buildings to be con-
structed on the Site pending completion of the
improvements;
(iv) A transfer of stock in a publicly held corpo-
ration or of the beneficial interest in any publicly
held partnership or real estate investment trust;
(v) A transfer or assignment from one partner or
joint venturer in Participant to another or from one
shareholder to another;
(vi) A transfer to an "affiliated entity," i.e.,
one in which a minimum of Fifty Percent (50%) of the
beneficial interest is owned and controlled by the same
person(s) who have the beneficial interest in the trans-
feror, or a transfer of Fifty Percent (50%) of
Participant's stock to a third party.
Notwithstanding any other provisions hereof, Participant
reserves the right, at its discretion without prior approval
of the Agency, to join and associate in a joint venture,
partnership or similar arrangement, for the purpose of
financing the acquisition and development of the Site and, in
that connection, Participant shall be entitled to convey or
contribute the Site to such entity and assign to such entity
some or all of its rights under this Agreement; provided,
however, that (i) any such assignee entity shall execute an
assumption agreement in form and content satisfactory to
Agency assuming the obligations of Participant under this
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Agreement consistent with its interest, (ii) Participant
shall remain jointly and severally responsible to Agency as
provided in this Agreement with respect to all obligations
pertaining to the Site, and (iii) Participant shall retain at
least a Fifty Percent (50%) interest in and operational and
managerial control of the joint venture, partnership or
similar arrangement.
The restrictions of this Section I.C.3 shall terminate
as to the Site upon the date of Participant's completion of
the Related Improvements as described herein. Upon the
completion of the Related Improvements, Agency, upon the
request of Participant, shall attest to such completion in a
form satisfactory to Participant.
In considering whether it will grant approval to any
assignment by Participant of its interest in the Site, which
assignment requires Agency approval, Agency shall consider
factors such as (i) the financial strength and capability of
the proposed assignee to perform Participant's obligations to
be assumed and (ii) the proposed assignee's experience and
expertise in the planning, financing, development, ownership
and operation of similar projects. The Agency shall not
unreasonably refuse to approve an assignment.
All of the terms covenants and conditions of this Agree-
ment shall be binding upon and shall inure to the benefit of
the Participant and the permitted successors and assigns of
the Participant. Whenever the term "Participant" is used
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herein, such term shall include any other permitted succes-
sors and assigns as herein provided.
II. ACQUISITION OF THE SITE
The Participant represents and warrants to each of the
Agency and the City that the Participant has an equitable
interest in the Site by virtue of a real property acquisition
contract for the assignment of an existing lease option on
the Site and that Participant is not in default under the
terms of that contract as of the execution by the Participant
of this Agreement.
III. DEVELOPMENT OF THE SITE
A. Development According to Terms of Approval
The Participant shall develop the Site in accord-
ance with the terms of the City's Land Use Permits. All dis-
cretionary land use approvals necessary for the development
of the Project shall be applied for by the Participant prior
to commencement of construction. The Participant shall be
required to pay all fees of the Agency and the City appli-
cable to the development of the Project (including without
limitation, fees for processing of maps and plan check).
Neither Participant nor the Agency shall be obligated in any
manner under the terms of this Agreement until Participant
has obtained all necessary governmental approvals for the
development of the Site.
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B. Agency Assistance
1. Among the infrastructure improvements required
for the Project are flood control improvements (Oso
Creek) the general location of which are described in
Attachment 1 attached hereto (the "Channel"), the design
and construction of which are subject to the City's Land
Use Permits and other required governmental approvals.
Only a portion of the cost of the Channel is allocable
to the Project. The balance of the cost of the Channel
is allocable to other projects within the Project Area
and to the Agency. The Agency, however, does not
currently have funds with which to pay for the portion
of the costs of the Channel attributable to other
projects. Participant is willing to contribute Five
Hundred Thousand Dollars ($500,000.00) towards the cost
of the construction of the Channel, which sum Agency
agrees represents the portion of the cost of the
Channel which is allocable to the Project as presently
contemplated. In addition, Participant is willing to
advance up to Two Million Dollars ($2,000,000.00) for
the purpose of constructing the Channel provided the
Agency is willing to reimburse Participant all such
funds so advanced. To the extent the City wishes to
incur additional costs for the construction of the
Channel beyond the sums contributed or advanced by
Participant (not to exceed Two Million Five Hundred
Thousand Dollars ($2,500,000)), such costs shall be
borne and/or financed entirely by the Agency. For the
purposes of this Agreement, the cost of the construction
of the Channel shall include all costs associated with
the construction and design of the Channel, including
those costs incurred for the preparation of plans and
specifications.
The Agency makes no representations that Partici-
pant shall receive City approval for any amount of net
useable acres, however, the foregoing financial
commitments are based upon obtaining the approval of the
City and all other necessary governmental agencies and
departments such that the Project consists of a minimum
of 40 net useable acres. For purposes of this
Agreement, the term "net useable acres" shall mean that
amount of land within the Project which is used for
building footprints, required parking and landscaping,
with landscaping constituting not more than 20% of the
total area used for building footprints and parking. In
the event governmental approvals are obtained for more
than 40 net useable acres for the Project, Participant
is willing to contribute toward the cost of the Channel
as its allocable share of the costs of the Channel an
additional sum of One Hundred Thousand Dollars
($100,000.00) for each net useable acre approved for the
Project above 40 net useable acres. Such payment shall
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not be subject to reimbursement to Participant by the
Agency.
2. Participant shall design and construct the
Channel, unless Agency elects to do so. Prior to the
award of the construction contract or contracts,
Participant shall submit to Agency the amount of the
lowest responsible bid (as determined by Participant's
best judgment) for Agency approval. Agency shall not
unreasonably withhold its approval, and in the event
Agency fails to approve or disapprove said amount within
fifteen (15) working days of receipt, said amount shall
be deemed approved. In the event that the amount of the
lowest responsible bid for the construction of the
Channel, when added to those costs incurred by
Participant for the design and planning of the Channel,
exceeds Two Million Five Hundred Thousand Dollars
($2,500.000.00), Participant may elect to advance the
amount in excess thereof, in which event such amount
shall be repaid to Participant in accordance with
subparagraph B.3 below, request Agency to seek
alternative financing for the Channel Project or portion
thereof, in which event Agency agrees to use its best
efforts to obtain such alternative financing or
terminate this Agreement. I£ Participant elects to
request Agency to seek alternative financing and alter-
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native financing satisfactory to Agency and Participant
is not available this Agreement shall terminate.
3. In consideration of the Participant's
performance of its obligations under this Agreement, the
amount incurred by Participant for the purpose of
constructing the Channel in excess of Five Hundred
Thousand Dollars ($500,000.00) (not to exceed Two
Million Dollars ($2,000,000.00) unless adjusted pursuant
to paragraph B.1 or B.2, above) shall be deemed to be a
loan by the Participant to the Agency. The unpaid
principal shall bear interest at the rate as set forth
in the "11 -Bond Index," published weekly by the Daily
Bond Buyer, in no event to exceed the statutory maximum
rate, for that date upon which Participant awards the
contract for the construction of the Channel, simple
interest, commencing on the date Participant awards said
contract, and continuing thereafter until principal and
interest are paid in full, repayable on the following
terms and conditions:
(a) Commencing in the first fiscal year
(beginning July 1) following the date of the
completion of the Channel (as evidenced by
acceptance of the Channel by Agency, City or other
governmental agency, which acceptance shall not be
unreasonably delayed), Agency shall pay to
Participant an amount equal to the "Net Property
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Tax Increment" from the Site as that term is
defined below for that fiscal year. Payments shall
be credited first to interest due and any remainder
to reduce the unpaid principal, until principal and
interest are paid in full.
(b) The obligation of Agency to Participant
shall be a special, not a general, obligation, and
payable only from property tax increment revenues
allocated to and received by Agency pursuant to
California Health and Safety Code Section 33670(b)
from the Site. Property tax increment revenues
from the Site shall not be pledged or encumbered by
Agency so as to impair Participant's rights under
this Agreement; provided, however, that Participant
agrees that its rights to repayment under this
Agreement shall be subordinate to the bonded
indebtedness of Agency provided Agency pledges to
set aside all Net Property Tax Increment from the
Site in order to fulfill its obligations hereunder,
so that Participant will be placed on the same
basis as governmental agencies which subordinate
their interests to the bonded indebtedness on a
pass through basis. The obligation referenced
herein is not an obligation of the City.
(c) Payments required to be made by Agency to
Participant hereunder for any fiscal year shall be
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made on July 30, 1985 of said fiscal year, based
upon the amounts of "Net Property Tax Increment"
received by Agency through that date. Agency may
prepay all or part of its obligation without
penalty.
(d) As used herein, the term "Net Property
Tax Increment" for the Site shall be defined as
follows:
(i) A "Frozen Property Tax Base" shall
first be determined, which sum shall be equal
to the property tax revenue derived from the
Site and allocated and paid to Agency for the
fiscal year immediately preceeding the fiscal
year in which Participant completes the
Related Improvements.
(ii) The "Net Property Tax Increment" in
any fiscal year shall mean the total property
tax increment derived from the Site and
allocated to the Agency pursuant to existing
agreements with other public agencies and
which is paid to the Agency for such fiscal
year less the Frozen Property Tax Base
determined in accordance wih subparagraph (i).
4. In the event that financing alternatives
superior to that contained herein become available, the
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parties hereto, by mutual agreement, may modify the
terms and conditions contained herein.
IV. TIMING OF LAND USE PERMIT APPROVALS; TERMINATION
This Agreement is entered into with the understanding
that all Land Use Permits will be obtained by Participant and
that City and Agency will have approved a preliminary design
concept for the Channel improvements on or before March 31,
1986 and that the escrow for Participant's acquisition of the
lease option on the Site will close on or before April 30,
1986. In the event the Land Use Permits have not been
obtained prior to March 31, 1986, or the escrow for
Participant's acquisition of the lease option has not closed
on or before April 30, 1986, Participant may elect to
terminate this Agreement by delivering a written notice of
termination to the Agency. Agency may elect to terminate
this Agreement by delivering a written notice of termination
to Participant if Participant shall fail to commence the
preparation of plans and specifications for the Channel upon
obtaining the Land Use Permits and thereafter fails to award
a contract for the construction of the Channel within six (6)
months after obtaining all required governmental permits for
the Channel Project.
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V. OTHER PROVISIONS
A. Obligation to Refrain from Discrimination
There shall be no discrimination against or segre-
gation of any person, or group of persons, on account of sex,
race, color, religion, national origin, marital status or
ancestry in the sale, lease, sublease, transfer, use occu-
pancy, tenure or enjoyment of the Project, nor shall the Par-
ticipant itself or any person claiming under or through it
establish or permit any practice or practices of discrimina-
tion or segregation with reference to the selection, loca-
tion, number, use or occupancy of tenants, lessees, sub-
tenants, sublessees or vendees. The covenants set forth in
this Article VI shall remain in effect in perpetuity.
B. Form of Nondiscrimination and Nonsegregation
The Participant shall refrain from restricting the
use, occupancy, rental, sale or lease of the Site or the
improvements thereon or any portion thereof on the basis of
sex, race, color, religion, ancestry, marital status or
national origin of any person., Any deed, lease or contract
entered into between Participant and Agency in furtherance of
this Agreement, shall contain or be subject to substantially
the following nondiscrimination or nonsegregation clauses:
1. In deeds: "The Grantee herein covenants by
and for himself or herself, his or her heirs, executors,
administrators and assigns, and all persons claiming under or
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through them, that there shall be no discrimination against
or segregation of, any person or group of persons on account
of race, color, creed, religion, sex, marital status,
national origin or ancestry in the sale, lease, sublease,
transfer, use, occupancy, tenure or enjoyment of the land
herein conveyed, nor shall the grantee himself or any person
claiming under or through him or her, establish or permit any
such practice or practices of discrimination or segregation
with reference to the selection, location, number, use or
occupancy of tenants, lessees, subtenants, sublessees or
vendees in the land herein conveyed. The foregoing covenants
shall run with the land."
2. In leases: "The Lessee herein covenants by
and for himself or herself, his or her heirs, executors,
administrators and assigns and all persons claiming under or
through him or her and this lease is made and accepted upon
and subject to the following conditions: That there shall be
no discrimination against or segregation of any person or
group of persons on account of race, color, creed, religion,
sex, marital status, national origin, or ancestry, in the
leasing, subleasing, transferring, use, or enjoyment of the
land herein leased, nor shall the lessee himself, or any per-
son claiming under or through him or her, establish or permit
any such practice or practices of discrimination or segrega-
tion with reference to the selection, location, number, use
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of occupancy of tenants, lessees, sublessee subtenants or
vendees in the land herein leased."
3. In contracts: "There shall be no discrimina-
tion against or segregation of, any person or group of per-
sons on account of race, color, creed, religion, sex, marital
status, national origin, or ancestry, in the sale, lease,
sublease, transfer, use, occupancy, tenure or enjoyment of
the land, nor shall the transferee himself or herself, or any
person claiming under or through him or her, establish or
permit any such practice or practices of discrimination or
segregation with reference to the selection, location, number
use or occupancy of permits, tenants, lessees, subtenants,
sublessees or vendees of the land."
C. Taxes, Assessments, Encumbrances and Liens
Without prejudice to the right of the Participant
to protest or appeal the determination or imposition of
taxes, the Participant shall pay when due all real estate
taxes and assessments assessed and levied upon the Site or
arising from this Agreement for the duration of the Redevel-
opment Plan.
D. Notices, Demands and Communications Between the
Parties
Written notices, demands and communication between the
Agency and the Participant shall be sufficiently given if
delivered personally to the other party or dispatched by
registered or certified mail, postage prepaid, return receipt
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requested, to the principal office of the Agency and to the
local office of the Participant as specified in Section I.C.
of this Agreement. Such written notices, demands and com-
munications may be sent in the same manner to such other
addresses as either party may from time to time designate by
mail as provided in this Section. Mailed notices shall be
effective three (3) business days after deposit in the mail.
E. Conflict of Interest; Agency's or City's Represen-
tatives Not Individually Liable
No member, official or employee of the Agency or
the City shall have any personal interest, direct or
indirect, in this Agreement; nor shall any such member,
official or employee participate in any decision relating to
this Agreement that affects his personal interest or the
interest of any corporation, partnership or association in
which he is, directly or indirectly, interested. No member,
official or employee of the Agency or the City shall be
personally liable to participate or any successor in interest
in the event of any default or breach by the Agency or the
City, or for any amount that may become due to Participant or
successor for any obligation under the terms of this Agree-
ment.
F. Enforced Delay, Extensions of Times of Performance
Performance by either party hereunder shall not be
deemed to be in default where delays or defaults are due to
war, insurrection, strikes, lockouts, riots, floods, earth-
quakes, fires, casualties, acts of God, acts of public enemy,
epidemics, quarantine restrictions, freight embargoes, lack
of transportation, governmental restriction or priority or
acts by a governmental agency or entity excepting the City's
growth management allocation system (other than the act or
failure to act of the Participant, Agency or City shall not
excuse performance by the Participant or Agency), litigation,
unusually severe weather, inability to secure necessary
labor, materials or tools, delays of any contractor,
subcontractor or supplier, or any other cause beyond the
control of the party seeking to be excused. An extension of
time for any such cause shall only be for the period of the
enforced delay. Times of performance under this Agreement
may also be extended in writing by the Agency and the
Participant.
G. Titles of Sections
Any titles of the several Sections of this Agree-
ment are inserted for convenience of reference only and shall
be disregarded in construing or interpreting any of its pro-
visions.
VI. DEFAULT, REMEDIES AND TERMINATION
A. Defaults
Subject to the extensions of time set forth in
Section V.F., failure or delay by either party to perform any
term or provision of this Agreement constitutes a default
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under this Agreement; however, if the party who so fails or
delays commences to cure, correct or remedy such failure or
delay within thirty (30) days after receipt of a notice spe-
cifying such failure or delay, and shall diligently prosecute
such cure, correction or remedy to completion, then such
party shall not be in default.
The injured party shall give written notice of
default to the party in default, specifying the default com-
plained of by the injured party. Except as required to pro-
tect against further damages, the injured party may not
institute proceedings against the party in default until
thirty (30) days after giving such notice. Failure or delay
in giving such notice shall not constitute a waiver of any
default, nor shall it change the time of default.
Except as otherwise expressly provided in this
agreement, any failure or delay by either party in asserting
any of its remedies as to any default shall not operate as a
waiver of any default or of any such rights or remedies or
deprive either such party of its rights to institute and
maintain any actions or proceedings which it may deem neces-
sary to protect, assert or enforce any such rights or reme-
dies.
B. Legal Actions
In addition to any other rights or remedies, either
party may institute legal action to cure, correct or remedy
any default, or recover damages for any default, or to obtain
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any other remedy consistent with the purpose of this Agree-
ment. Such action shall not be brought unless the party
seeking to institute proceedings has delivered or served
written notice of default on the other party not less than
thirty (30) days prior to filing suit.
Such legal actions must be instituted in the
Superior Court of the County of Orange, State of California,
in an appropriate Municipal Court in the County, or in the
Federal District Court in the Central District of California.
C. Specific Performance
If the Participant or the Agency defaults under any
of the provisions of this Agreement, the nondefaulting party
shall serve written notice of such default upon the default-
ing party. If the default is not cured by the defaulting
party within thirty (30) days of the service of this default,
the nondefaulting party, at its option, may institute an
action for specific performance of the terms of this Agree-
ment.
D. Applicable Law
The laws of the State of California shall govern
the interpretation and enforcement of this Agreement, except
as to matters governed by federal laws and regulations.
E. Acceptance of Service of Process
In the event that any legal action is commenced by
the Participant against the Agency, service of process on the
Agency shall be made by personal service upon the Chief
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Executive Officer or Chairman of the Agency, or in such other
manner as may be provided by law.
In the event that any legal action is commenced by
the Agency against the Participant, service of process on the
Participant shall be made by personal service upon any
authorized agent or person authorized by law to receive ser-
vice of process for the Participant (or a successor) and
shall be valid whether made within or without the State of
California, or in such other manner as may be provided by
law.
F.
Rights and Remedies
are Cumulative
Except as otherwise
expressly stated in
this Agree-
ment, 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 times,
of any other rights
or remedies
for the same
default or any other default by the
other party.
G.
Inaction Not a Waiver of Default
Any failures or delays by either party in asserting
any of its rights and remedies as to any default shall not
operate as a waiver of any default or of any such rights or
remedies or deprive either such party of its right to insti-
tute and maintain any actions or proceedings which it may
deem necessary to protect, assert or enforce any such riaghts
or reme;dies.
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H. Counterparts
This Agreement is executed in three (3) counter-
parts, each of which is deemed to be an original.
I. Entire Agreement, Waivers and Amendments; Execution
The Agreement integrates all of the terms and con-
ditions mentioned herein or incidental thereto, and super-
sedes all negotiations or previous agreements between the
parties with respect to all or any part of the subject matter
thereof.
All waivers of the provisions of this Agreement
must be executed in writing by the appropriate authorities of
the Agency or the Participant and all amendments hereto must
be executed in writing by the appropriate authorities of the
Agency and the Participant.
This Agreement, when executed by the Participant
and delivered to the Agency, must be authorized, executed and
delivered by the Agency within thirty (30) days after the
date of execution by the Participant or this Agreement shall
be void, except to the extent that the Participant shall con-
sent in writing to a further extension of time for the
authorization, execution and delivery of this Agreement. The
date of this Agreement shall be the date when the Agreement
shall have been signed by the Agency.
J. Vested Rights
Nothing contained in this Agreement shall imply
that City has agreed to approve the Land Use Permits or any
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•
other development approvals for the Site and Participant
shall not have a vested right to develop the Site for any
purpose by virtue of this Agreement.
IN WITNESS WHEREOF, the Agency and the Participant have
duly executed this Agreement as of the date first above writ-
ten.
THE REDEVELOPMENT AGENCY OF THE
CITY OF AN JUAN CAPISTRANO
GARY USDORF , AIRMAN
Date // GCSfi 1985 By (o
Vice irman LaWtence F. Buchheim
ATTEST:
gency Se retary
Mary Ann Hanover
KAISER DEVELOPMENT COMPANYA
Approved as to Form: ornia orporatio
By:
--� I s:
Agency Cou sel
Tom Clark
pRQdP
By:
Its:
-24-
ATTACHMENT N0.1
Hi r.
i i \
r
.mow
77
W,
San Juan Capistrano
Community
Redevelopment
Agency
November 15, 19
Charles X. Delg
Kaiser Developm
P. O. Box 308
Carlsbad, California
Re: Participation Agreement - Kaiser Development Company
Dear Mr. Delgado:
Enclosed is a fully executed copy of the Participation Agreement
between the San Juan Capistrano Community Redevelopment Agency
and the Kaiser Development Company.
Thank you for your cooperation.
please do not hesitate to call.
Very truly yours,
MARY ANN ANO VER, CMC
Agency Secretary
MAH/mac
Enclosure
cc: Executive Director
32400 Paseo Adelanto
San Juan Capistrano
Califomia 92675
714-493-1171
If you have any questions,
0
KAISER DEVELOPMENT COMPANY
INDUSTRIAL/COMMERCIAL SOUTHWEST
October 31, 1985
Steve Julian
City Manager
CITY OF SAN JUAN CAPISTRANO
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
U
Re: Participation Agreement by and between the
Redevelopment Agency of the City of San Juan Capistrano
and Kaiser Development Company
Dear Mr. Julian:
Enclosed are two (2) copies of the above -referenced agreement, which have been
executed by Kaiser. Please return one (1) fully executed copy to this office
after the Agency Secretary has signed where indicated on the signature page.
Thank you.
Very truly yours,
i
Charles X. Delgado
Legal Counsel
/tlf
Encl.
nil 7 Irl'
A Wholly Owned Subsidiary of Kaiser Aluminum 8 Chemical Corporation
2121 PALOMAR AIRPORT ROAD, SUITE 201, P.O. BOX 308, CARLSBAD, CALIFORNIA 92008-0060 TELEPHONE: (619) 438-2636
RANCHO CALIFORNIA. CA/HAWAII KAI, HI/KAISER CENTER. OAKLAND, CAANDUSTRIAL AND COMMERCIAL PROPERTIES WESTERN STATES/KAISER ALUMINUM REAL ESTATE FACILITIES -WORLDWIDE
IIfIMM11
• lfMllf111 1 Il161
1776
September 5, 1985
Kaiser Development Company
2121 Palomar Airport Road, Suite 201
P. O. Box 308
Carlsbad, California 92008
Re:
MEMSERS OF THE CITY COUNCIL
ANTHONY L. ELAND
LAWRENCE F. SUCHHEIM
KENNETH E. FRIESS
GARY L. HAUSOORPZR
PHILLIP R. SCHWARTZZ
CITY MANAGER
STEPHEN E. JULIAN
Gentlemen:
The City Council of the City of San Juan Capistrano at its
regular meeting held September 3, 1985, adopted Resolution No.
85-9-3-5 consenting to the Redevelopment Agency's agreement with
your firm for construction of channel improvements at the
Bathgate property adjacent to Oso Creek.
A copy of Resolution No. 85-9-3-5 is enclosed for your
information.
Thank you for your cooperation. If you have any questions,
please do not hesitate to call.
Very truly yours,
MARY ANN OVER, CMC
City Clerk
MAH/mac
Enclosure
cc: City Manager
Director of Community Planning
and Development
Tom Clark
32400 PASEO ADELANTO, SAN JUAN CAPISTRANO, CALIFORNIA 92675 • (714) 493-1171
••
AGENDA ITEM
TO: City Council
FROM: Stephen B. Julian, City Manager
SUBJECT: Kaiser Development Agreement
SITUATION•
••
September 3, 1985
The Redevelopment Agency has entered.into an agreement with the Kaiser
Development Company providing for Kaiser's contribution toward and
advance of funds for construction of certain channel improvements
adjacent to the Bathgate property. Under redevelopment law (Health
and Safety Code §33445), a redevelopment agency may expend funds for
the construction of public facilities in a project area, providing
consent is also obtained from the legislative body, that is, the City
Council. Based upon the Agency's earlier approval of this agreement,
it is recommended that the City Council consent to the expenditure
of funds as set forth in the proposed agreement.
COMMISSION/BOARD REVIEW, RECOMMENDATIONS:
Not applicable.
FINANCIAL CONSIDERATIONS:
No financial cost involved for the City.
ALTERNATE ACTIONS:
Move to adopt resolution consenting to the Redevelopment Agency's
agreement with Kaiser Development Company for construction of
channel improvements at the Bathgate property adjacent to Oso Creek.
2. Continue the matter.
RECOMMENDATION:
Move to adopt resolution consenting to the Redevelopment Agency's
agreement with Kaiser Development Company for construction of channel
improvements at the Bathgate property adjacent to Oso Creek.
------------------------------------------------------------------------
------------------------------------------------------------------------
Resp ful4JAN
tted,
EN B.
City Manager
H3
raw C'iT •,f`!�
� �I ^'n,I_ �,(-�E�!I?A ...w�
i�
I
• • • •
RESOLUTION NO. 85-9-3-5
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF SAN JUAN CAPISTRANO, CALIFORNIA, DETERMINING
THAT THE CONSTRUCTION OF CERTAIN ONSITE AND
OFFSITE PUBLIC IMPROVEMENTS IN CONNECTION WITH
THE DEVELOPMENT OF A BUSINESS PARR PROJECT
PURSUANT TO A PARTICIPATION AGREEMENT BY AND
BETWEEN THE COMMUNITY REDEVELOPMENT AGENCY OF
THE CITY OF SAN JUAN CAPISTRANO AND RAISER
DEVELOPMENT COMPANY IS OF BENEFIT TO THE
CENTRAL REDEVELOPMENT PROJECT AND THE IMMEDIATE
NEIGHBORHOOD IN WHICH THE PROJECT IS LOCATED
AND DETERMINING THAT THERE ARE NO OTHER
REASONABLE MEANS OF FINANCING SAID PUBLIC
IMPROVEMENTS
WHEREAS, the Community Redevelopment Agency of the City
of San Juan Capistrano ("Agency") is authorized to carry out the
redevelopment of the Central Redevelopment Project Area ("Project
Area"); and,
WHEREAS, the Redevelopment Plan for the Project Area
authorizes and directs the Agency to pay all or part of the value
of the construction and installation of certain public
improvements; and,
WHEREAS, the Agency has entered into that certain
Participation Agreement ("Agreement") with Raiser Development
Company ("Developer") which calls for the Agency to construct
certain flood control improvements to be known as the Oso Creek
Flood Control Channel ("Agency Improvements") in conjunction with
the construction by Developer of a business park consisting of a
mix of industrial, research and development and office and
related support uses ("Project"); and,
WHEREAS, California Health & Safety Code Section 33445
provides that a redevelopment agency may, with consent of the
legislative body, pay all or part of value of public buildings
facilities, structures or other improvements upon a finding that
such public improvements are of benefit to the Project Area or
the immediate neighborhood in which the Project is.located and
that there are no other reasonable means of financing said public
improvements available to the community.
NOW, THEREFORE, the City Council of the City of San
Juan Capistrano does hereby resolve as follows:
-1-
r .
Sectic l • 00
This City Council hereby determines that the
acquisition, construction and installation of the Agency
Improvements will be of benefit to the Project Area and the
surrounding neighborhood in which the Project is located.
Section 2.
This City Council further determines that no other
reasonable means of financing the acquisition, construction and
installation of the Agency.Improvements is available.
Section 3.
This Resolution shall take effect immediately upon its
adoption.
PASSED, APPROVED AND ADOPTED this 3rd day of
—.qdap l-&Mhor , 1 QRS
ATTEST:
STATE OF CALIFORNIA
COUNTY OF ORANGE
CITY OF SAN JUAN CAPISTRANO
ss.
i / •
I, MARY ANN HANOVER, 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. RS,3-1-s , adopted by
the City Council of the City of San Juan Capistrano, California,
at a regular meeting thereof held on the ';rr4 day of
�9pn Dinh r , 1985 , by the following vote:
AYES: Councilmen Friess, Bland, Buchheim,
Hausdorfer, and Mayor Schwartze
NOES: None
ABSENT: None
(SEAL)
MARY ANr 10 ER, CITY CLERK
-2-
t
San Juan Capistrano
Communitv
Redevelopment
.agency
August 30, 1985
Tom Clark
Stradling, Yocca, Carlson 6 Rauth
Attorneys at Law
P. 0. Box 7680
Newport Beach, California 92660-6401
Re:
Dear Mr. Clark:
Two copies of each of the following Agreements are enclosed which
require your signature: c;
_ �1. Participation Agreement by and between the
Nob Redevelopment Agency of the City of San Juan Capistrano
and Raiser Development Company, scheduled for City
,- approval on September 17, 1985.
2. Agreement between the County of Orange; the Orange
County Flood Control District; the Orange County
Harbors, Beaches, and Parks District; the San Juan
gt11 Capistrano Redevelopment Agency; and the City of San
Juan Capistrano for Redevelopment Plan Amendment 84-1,
scheduled for Agency and City approval on September 17,
F` " 1985.
Please sign these Agreements and return them to this office at
Your earliest convenience. It will also be necessary for us to
obtain signatures from Raiser Development Company prior to the
September meeting.
32400 Paseo Adelanto
San Juan Capistrano
California 92675
714-499.1171
Cl
j
•
Tom Clark
Thank you for your cooperation.
please do not hesitate to call.
Very truly yours,
17ze�llle
MARY ANN PNOVER, CMC
City Clerk
MAH/mac
Enclosures
•
-2-
August 30, 1985
If you have any questions,
1k •0 00
1.
- OSO CREEK FLOOD CONTROL
Written Communications.-
Report.dated August 27, 1985, from the Deputy Director
forwarding a Participation Agreement between the Agency and
Kaiser Development company, as approved in concept at the
meeting of August 20, 1985, in connection with development
of a business park project. The site is on the Bathgate
property off Camino Capistrano at the northern City limits.
The agreement provides that:
1. Kaiser will pay $500,000 of
improvements. In addition,
for every net usable acre i
nthe Oso Creek channel
they will pay $100,000 more
excess of 40.
2. The Community Redevelopment Agency will pay for the
remaining costs of flood control improvements, but in
no event will the Agency contribution exceed $2
million.
3. Kaiser will loan the Community Redevelopment Agency up
to $2 million for the Community Redevelopment Agency's
share of the flood control improvements. The Community
Redevelopment Agency will reimburse Raiser using the
annual net tax increment coming from the Bathgate
-1- 8/27/85
•• 00
property. The Agency will pay an interest rate
equivalent to the prevailing rate for tax exempt bonds
at the time the obligation is created.
The Executive Director made an oral report and advised that
there is no commitment on the part of the City or Agency for
concept or land use approvals; the channel design will be
subject to the review process; that Kaiser and the Agency
are entering into the Agreement in good faith.
Resolution A rovinectoA reement:
It was move by Dirr Sc wartze, seconded by Director
Friess, that the following Resolution, which makes findings
pursuant to Health and Safety Code Section 33445, be
adopted:
DEVELOPMENT COMPANY) - A XZbVLUT1UN UY THE SAN JUAN
CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, APPROVING A
PARTICIPATION AGREEMENT BY AND BETWEEN THE AGENCY AND
KAISER DEVELOPMENT COMPANY; DETERMINING THAT THE
CONSTRUCTION OF CERTAIN ONSITE AND OFFSITE PUBLIC
IMPROVEMENTS IN CONNECTION WITH THE DEVELOPMENT OF A
BUSINESS PARK PROJECT BY KAISER DEVELOPMENT COMPANY
PURSUANT TO SAID PARTICIPATION AGREEMENT IS OF BENEFIT
TO THE CENTRAL REDEVELOPMENT PROJECT AND THE IMMEDIATE
NEIGHBORHOOD IN WHICH THE PROJECT=IS LOCATED;
DETERMINING THAT THERE ARE NO OTHER REASONABLE MEANS OF
FINANCING -SAID IMPROVEMENTS; AND AUTHORIZING THE
EXECUTION AND DELIVERY OF SAID PARTICIPATION AGREEMENT
The motion carried by the following vote:
AYES: Directors Friess, Bland, Schwartze,
and Buchheim.
NOES: None
ABSENT: Chairman Hausdorfer
Approval of Participation Ae
rement:
It was moved y Director Sc wartze, seconded by Director
Friess, and unanimously carried to approve the Participation
Agreement by and between the Redevelopment Agency of the
City of San Juan Capistrano and Kaiser Development Company
and to authorize the Vice Chairman and Agency Secretary to
sign the Agreement on behalf of the Agency.
-2- 8/27/85
AGENDA ITEM August 27, 1985
TO: Stephen B. Julian, Executive Director
Community Redevelopment Agency
FROM: Thomas G. Merrell, Deputy Director
Community Redevelopment Agency
SUBJECT: Participation Agreement Between Community Redevelop-
ment Agency and Kaiser Development Company
SITUATION
At the Community Redevelopment Agency meeting of August 20,
staff presented a request by Kaiser Development Company for
financial assistance with their project on the Bathgate
property. In their request they indicated that their project
would not be profitable unless they could limit their
contribution to Oso Creek flood control improvements to
$500,000. They indicated a need for an immediate decision
inasmuch as a substantial option payment will be due at the end
of August.
At the August 20 meeting the Agency approved, in concept,
Community Redevelopment Agency assistance with Oso Creek
improvements and directed staff to prepare the necessary
agreement for subsequent Agency action. Following that
meeting, staff received and analyzed the Kaiser Company's
pro -forma and has confirmed that the margin of profitability
is tight and that without assistance the risks inherent
to the project leave little incentive to a developer.
A participation agreement has been prepared and is offered
for Agency approval. The key points to the agreement are as
follows:
1. Kaiser will pay $500,000 of the creek channel improvements.
In addition, they will pay $100,000 more for every net
usable acre in excess of 40.
2. The Community Redevelopment Agency will pay for the
remaining costs of flood control improvements but, in
no event, will the Agency contribution exceed $2 million.
3. Kaiser will loan the Community Redevelopment Agency up to
$2 million for the Community Redevelopment Agency's
share of the flood control improvements. The Community
Redevelopment Agency will reimburse Kaiser using the
annual net tax increment coming from the Bathgate property.
The Agency will pay an interest rate equivalent to the
prevailing rate for tax exempt bonds.
0 0
Agenda Item -2- August 27, 1985
4. Kaiser will not transfer title or otherwise release
control of the project without approval of the Agency.
5. Unless otherwise agreed, Kaiser will prepare plans
and contract for the improvements.
6. In the event that zoning and land use approvals are not
obtained on or before March 31, 1986, Kaiser may terminate
the agreement.
It should be pointed out that the basis for Kaiser's proposal
is that the flood control improvements will be an aesthetically
pleasing, open channel design consistent with the General Plan.
They estimate improvement costs for such a design at $2 million.
In the event that these costs are actual, Kaiser would then
build the improvements and pay the $2 million at the beginning
of their project. The Community Redevelopment Agency would
reimburse Kaiser on an annual basis using the tax increment
from the project for $1,500,000, plus interest. However,
if a more expensive project is proposed, up to $2 million
will be advanced and similarly reimbursed. Should the total
cost of the flood control improvements exceed $2,500,000,
Kaiser and the Community Redevelopment Agency will have to
seek alternative methods of financing the additional funds
needed.
When entering into such a participation agreement calling
for the Community Redevelopment Agency to pay a portion of
the cost of public improvements in a project area, Health
and Safety Code Section 33445 requires that findings be made
that the improvements are a benefit to the redevelopment project
area and that no other reasonable means of financing the
improvements are available. Such a resolution has been prepared
for Agency adoption prior to approval of the agreement.
COMMISSION. BOARD REVIEW, RECOMMENDATION
Not applicable.
FINANCIAL CONSIDERATIONS
This agreement would obligate the Agency to reimburse Kaiser
for up to $2 million for flood control improvements in Oso
Creek. Net tax increment revenues from the project are pledged
toward this reimbursement. The amount of tax increment revenues
derived from the project will rise as development proceeds.
Thus, it is not possible to project accurately how long it
will take for these revenues to cover the reimbursement
obligation. Current estimates project a period of six -to -ten
years.
0
Agenda Item -3- August 27, 1985
ALTERNATE ACTIONS
1. Adopt the resolution making findings under Health and
Safety Code Section 33445, approve the participation
agreement, and authorize its execution by the Chairman
of the Community Redevelopment Agency.
2. Do not approve the participation agreement at this time.
RECO14MENDATION
Adopt the resolution making findings under Health and
Safety Code Section 33445, approve the participation agreement,
and authorize its execution by the Chairman of the Community
Redevelopment Agency.
Respectfully submitted,
Thomas G. Merrell, Deputy Director
Community Redevelopment Agency
TGM:lcl
Attachments
01-1
L
RESOLUTION NO. CRA 85-8-27-1
M
A RESOLUTION OF THE SAN JUAN CAPISTRANO COMMUNITY
REDEVELOPMENT AGENCY, APPROVING A PARTICIPATION
AGREEMENT BY AND BETWEEN THE AGENCY AND RAISER
DEVELOPMENT COMPANY; DETERMINING THAT THE
CONSTRUCTION OF CERTAIN ONSITE AND OFFSITE PUBLIC
IMPROVEMENTS IN CONNECTION WITH THE DEVELOPMENT
OF A BUSINESS PARR PROJECT BY RAISER DEVELOPMENT
COMPANY PURSUANT TO SAID PARTICIPATION AGREEMENT
IS OF BENEFIT TO THE CENTRAL REDEVELOPMENT PROJECT
AND THE IMMEDIATE NEIGHBORHOOD IN WHICH THE
PROJECT IS LOCATED; DETERMINING THAT THERE ARE
NO OTHER REASONABLE MEANS OF FINANCING SAID
IMPROVEMENTS; AND AUTHORIZING THE EXECUTION AND
DELIVERY OF SAID PARTICIPATION AGREEMENT
WHEREAS, the Community Redevelopment Agency of the City
of San Juan Capistrano ("Agency") is authorized to carry out the
redevelopment of the Central Redevelopment Project Area ("Project
Area"); and,
WHEREAS, the Redevelopment Plan for the Project Area
authorizes and directs the Agency to pay all or part of the value
of the construction of certain public improvements; and,
WHEREAS, the Agency desires to enter into a
Participation Agreement ("Agreement") with Raiser Development
Company ("Developer"), substantially in the form presented to the
Agency at the meeting at which this Resolution was adopted, which
requires the Developer to construct a businessparkconsisting of
a mix of industrial, research and development and office and
related support uses ("Project"); and,
WHEREAS, pursuant to the Agreement, the Agency is
required to construct certain flood control improvements
necessary to serve the Project ("Agency Improvements") in
conjunction with the construction of the Project by the
Developer; and,
WHEREAS, California Health 8 Safety Code Section 33445
provides that a redevelopment agency may, with consent of the
legislative body, pay all or part of the value of public
buildings, facilities, structures or other improvements upon a
finding that such public improvements are of benefit to the
Project Area or the immediate neighborhood in which the Project
is located and that there are no other reasonable means of
financing such public improvements available to the community.
NOW, THEREFORE, the Community Redevelopment Agency of
the City of San Juan Capistrano does hereby resolve as follows:
-1-
0 0
Section 1.
The Agency hereby approves the form of the Agreement
presented to the Agency at the meeting at which this Resolution
was adopted and hereby authorizes the Chairman and Secretary of
the Agency to execute said Agreement on behalf of the Agency, and
hereby authorizes the Chairman, Secretary, Executive Director and
Deputy Executive Director of the Agency to execute any and all
documents and instruments required in order to consummate the
a;
transactions contemplated by the Agreement.`
Section 2.-;
The.Agency hereby determines that the acquisition,
construction and installation of the Agency Improvements is of
benefit to the Project Area and the surrounding neighborhood in
which the Project is located.
Section 3.
The Agency hereby determines that it is appropriate to
construct and install or cause the construction and installation
of the Agency Improvements and that there are no other reasonable
means of financing the Agency Improvements.
Section 4.
This Resolution shall become effective upon the
adoption of a resolution by the City Council of the City of San
Juan Capistrano finding that the construction of the Agency
Improvements by the Agency is of benefit to the Project Area and
the immediate neighborhood in which the Project is located and
that there are no.other reasonable means of financing the
construction of the Agency Improvements.
PASSED, APPROVED AND ADOPTED this 27th day of
August , 1985 .
ATTEST:
GENAR
GARY L. USDORFER CHAIRMAN
B
CE F. BCCHHEIM, VICE CHAIRMAN
-2-
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss.
CITY OF SAN JUAN CAPISTRANO )
I, MARY ANN HANOVER, Secretary of the San Juan
Capistrano Community Redevelopment Agency, DO HEREBY CERTIFY that
the foregoing is a true and correct copy of Resolution No. CRA
85-8-27-1, adopted by the Board of Directors of the San Juan
Capistrano Community Redevelopment Agency at an adjourned regular
meeting thereof held on the 27th day of August , 1985, by
the following vote:
AYES: Directors Friess, Bland, Schwartze,
and Vice Chairman Buchheim
NOES: None
ABSENT: Chairman Hausdorfer
(SEAL)
MARY ANN ANOVER,
AGENCY'SECRETARY
-3-
0
San Juan Capistrano
Community
Redevelopment
Agency
August 21, 1985
Frank W. Rice, Jr.
Regional Vice President
Kaiser Development Company
P. O. Box 308
Carlsbad, California 92008-0060
Re:
s
Dear Mr. Rice:
0
t
The Community Redevelopment Agency of the City of San Juan
Capistrano at its regular meeting held August 20, 1985, approved
in concept the Agency's assistance with the Oso Creek flood
control improvements at approximately $1.5 million and directed
staff to prepare the necessary Development Agreement.
The Agency is tentatively scheduled to take action on the
Development Agreement at their Regular Adjourned Meeting
scheduled for Tuesday, August 27, 1985, at 7:00 p.m. A copy of
the agenda will be forwarded to you prior to that meeting.
Thank you for your cooperation.
please do not hesitate to call.
Very truly yours,
, a2ay �l7
MARY ANN(/ HANOVER, CMC
Agency Secretary
MAH/mac
cc: Deputy Director
32400 Paseo Adelanto
San Juan Capistrano
California 92675
714-493-1171
If you have any questions,
Written Communications:
Additional Report dated August 20, 1985, from the Deputy
Director, advising that Raiser Development Company had been
working on development concepts for the northerly 50 acres
of the 78 -acre Bathgate property located off Camino
Capistrano at the northern City limits. The report advised
that Raiser Development. Company had.requested assistance
with the --necessary Oso Creek channel improvements, including
a commitment from the Agency prior to August 28, in order
for the project to proceed. The report forwarded a letter
dated April 13, 1985, from Frank W. Rice, Jr., Regional Vice
President, Raiser development Company, 2121 Palomar Airport
Road, Suite 201, P. 0. Box 308, Carlsbad, 92008-0060,
setting forth a proposal for financial assistance. The
proposal provided for Raiser Development Company to pay the
full -cost of all improvements, with reimbursement from the
Agency of $1.5 million for an Oso Creek open channel design.
Repayment would be made over a 10 -year period at 118
interest. The letter advised that should a covered box
design be required, increased costs would require a greater
financial commitment from the Agency.
The Executive Director made an oral report, advising that
staff recommended the request be handled through a
Development Agreement concept; final negotiations could be
completed and an Agreement presented for approval at an
adjourned meeting on August 27. He advised that discussions
were continuing regarding the extension of the covered box
channel; an open channel would be designed with
earth -covered rock riprap for a natural appearance.
Council discussed the two channel designs, noting that
improvements would be subject to future City approvals;
approval of this request would not commit the Agency to
either channel design. Director Friess suggested
consideration be given to more beneficial terms for
repayment.
-2- 8/20/85
•
21,
Frank Rice, Raiser Development, discussed the financial
aspects of the project, stating a project had been developed
that would be of benefit to both the City and the developer.
However, if the covered box channel were required, the
project would be unable to absorb the increased costs.
Raiser development Company would be willing to provide the
extra funds, but would expect reimbursement from the Agency.
Concept Approval:
It was moved by Director Schwartze, seconded by Director
Friess, and unanimously carried to approve in concept Agency
assistance with Oso Creek improvements, noting that a
commitment was not made to either channel design; and, to
direct staff to prepare the necessary Development Agreement
for future consideration.
AGENDA ITEM August 20, 1985
TO: Stephen B. Julian, Executive Director
Community Redevelopment Agency
FROM: Thomas G. Merrell, Deputy Director
Community Redevelopment Agency
SUBJECT: Request For CRA Assistance By Kaiser Development
Company "Bathgate Properties".
SITUTATION
Over the past several months, Kaiser has been working on
development concepts for the northerly 50 acres + of the 78 -
acre Bathgate property. Recently, Kaiser has retained
Tierra Planning to address the concerns identified by the
Planning Commission at its earlier worksession on the project.
We believe that the resulting concept alternatives prepared
by Tierra are encouraging and believe we can work out a
mutually -supportable site design. The access road, requiring
an eight -to -ten foot raising of Camino Capistrano is still a
source of concern, however.
Planning Commission review of revised site designs will be
scheduled for September or Otober, depending on Kaiser's
actual submission of plans. As noted in their letter, they
need to have all discretionary approvals (EIR, Rezone,
General Plan Amendment, site plan, tentative map) and final
map recordation by April, 1986. This is "do -able" if they
make their plan submittals early.
During the past several weeks Kaiser has requested CRA
assistance with the necessary improvements to Oso Creek. The
following is a summary of the issues involved.
1. Per the attached letter, Kaiser is requesting CRA
commitment to help with the Oso Creek improvements
prior to August 28, when their next option payment is
due to Mr. Simonian.
Per their letter, Kaiser is proposing to front the full
cost of all improvements (including Oso Creek) with the
CRA reimbursing them for $1.5 million of an Oso Creek
open channel design (e.g. earth -covered rock riprap)
over ten years at 11 percent interest. They estimate
the cost of continuing the covered box design as resulting
in a $3.8 million CRA commitment (instead of the $1.5
million).
3. Per our request, Kaiser will supply us with their draft
pro -forma on the project this week.
Agenda Item -2- August 20, 1985
4. Upon completing an analysis of the pro -forma and
clarifying the defination of costs, staff will be
preparing a Development Ageement for Agency consideration,
and the agreement will provide for the Agency to reimburse
Kaiser for approximately $1.5 million dollars, attributable
to costs of improving Oso Creek.
5. At the end of this month Kaiser will incur substantial
costs in order to carry the property. They will need
firm indication of the Agency's willingness to cooperate.
Staff is recommending an informal action by the Agency
to indicate willingness to consider participation in
the project, as is outlined above.
FINANCIAL CONSIDERATIONS
There are no financial obligations associated with this
action. Ultimate approval of a Development Agreement resulting
from this action could obligate the Agency for reimbursement
costs for Oso Creek Channel improvements, over a period of
ten years or more. Tax increments from the project is
expected to be sufficient to cover these costs.
ALTERNATE ACTIONS
1. Indicate preliminary approval of a Development Agreement
providing for reimbursement for Oso Creek Improvements.
2. Indicate the Agency is not willing to approve financial
assistance for this project.
3. Indicate other areas of assistance desirable to the
Agency.
RECOMMENDATION
By motion, approve in concept Agency assistance with Oso
Creek improvements as outlined in staff report, and direct
staff to prepare the necessary Development Agreement for
subsequent Agency action.
Respectfully submitted,,_ ,n
Thomas G. Merrell, Deputy Director
Community Redevelopment Agency
TGM:kjs
KA/SER DEVELOPMENT COMPANY
FRANK W. RICE JR,
REGIONAL VICE PRESIDENT
INOUSTRIALICOMMERCIAL SOUTHWEST
HAND DELIVERED
August 13, 1985
Mr. Steve Julian
City Manager
CITY OF SAN JUAN CAPISTRANO
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
Re: Bathgate Property, San Juan Capistrano
Dear Steve:
Based upon our earlier conversations, we have formulated a proposal whereby the
City of San Juan Capistrano through its redevelopment agency can assist us with
the Bathgate project improvement costs. This will enable us to reduce the
intensity of development to a level desired by the City while retaining the
financial feasibility of the project.
As we have indicated to you, the project desired by the City will support an
infrastructure cost of approximately $5.2 million, but the approximate
development costs will be either $6.7 million, if the Oso Creek drainage facility
can be constructed as an open channel, or in excess of $9.0 million if box
culvert construction is required.
You have asked us to prepare a proposal whereby the City acting through its
redevelopment agency could reduce Kaiser's share of the project's infrastructure
costs to $5.2 million. After investigating several alternatives, we believe that
the following proposal best meets the needs of the City, the redevelopment agency
and Kaiser Development.Company.
Our proposal is as follows:
1. Kaiser will undertake at its cost the development of all infrastructure
facilities required for the project with the exception of the Oso Creek
storm drain channel. It is currently estimated that these costs will be
approximately $4.7 million.
2. Kaiser will advance to the redevelopment agency those funds required for
construction of an open drainage channel. ($2.0 million is our estimate for
these costs). The redevelopment agency will repay Kaiser the actual amount
advanced less $500,000 with interest at a rate of 11% per annum. Repayment
A Wholly Owned Subsidiary of Kaiser Aluminum & Chemical Corporation
2121 PALOMAR AIRPORT ROAD. SUITE 201. P.0 BOX 308 CARLSBAD. CALIFORNIA 920080060 TELEPHONE 1619, 4382 6.36 I
RANCHO CALIFORNIA CAJHAWAII KAL HUKAISER CENTER. OAKLANO. CA INDUSTRIAL AND COMMERCIAL PROPERTIES -WESTERN STATESIKAISER ALUMINUM REAL ESTATE FACILITIES WORLDWIDE
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will be made in forty (40) equal quarterly installments of principal and
interest commencing ninety (90) days after completion of improvements, and
will be evidenced by a promissary note structured such that the interest
thereon is tax free (for federal income tax purposes) to Kaiser.
Reimbursement will be made from a fund to be established, the source of
which will be the tax increment generated by the project. We understand
that the 116 rate has been utilized recently in a similar project in the
City of San Juan Capistrano.
3. To the extent the City wishes to incur additional costs for the construction
of the drainage improvements, such costs would be borne and/or financed
entirely by the City or the redevelopment agency.
The foregoing cost estimates are predicated on the necessary processing being
completed through the City of San Juan Capistrano so that a final map can be
recorded and escrow can close no later than April, 1986, and any delays will
result in a need to revise these cost figures. We anticipate that construction
will start shortly thereafter.
We therefore request that the City initiate the General Plan Amendment whicfi will
be required in order to permit the proposed development and that the City commit
to the expeditious processing of this project so as to permit us to be in a
position to have a final map recorded by April, 1986.
We are prepared to furnish the City with a pro forma demonstrating the need for
the City or the agency's participation with us in this project, and we would be
happy to answer any additional questions that the City may have with respect to
our proposal.
We believe that the foregoing proposal is the fairest to Kaiser and the City and
will be the easiest to implement. As we have indicated to you, it is necessary
that we arrive at a final and formal agreement with regard to this matter before
August 28, 1985 as we have a substantial financial commitment which must be made
at that time if the project is to proceed.
Cordially,
tank W. Rice JrJ.
Regional Vice President
c.c. - Thomas.G. Merrell
FWR/dhm.