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00-0801_STROSCHER ENTERPRISE_Agenda Report_ D5 6/5/2007 AGENDA REPORT D5 TO: Dave Adams, City Manager 9CA, FROM: Douglas D. Dumhart, Economic Development Manager SUBJECT: Consideration of Terminating the Second Amendment to the License Agreement with Stroscher Enterprises for a Temporary Public Parking Lot at 26871 Ortega Highway and Transferring Project Funds to Overlay the Capistrano Depot North Parking Lot. (APN 124-170-12)(Former Walnut Grove Restaurant) RECOMMENDATION: Terminate the Second Amendment to License Agreement with Stroscher Enterprises for a Temporary Public Parking Lot at the former Walnut Grove Restaurant; and Transfer $55,000 budgeted funds to overlay the Capistrano Depot North Parking Lot. SUMMARY: On December 19, 2006, the City Council approved a Second Amendment to its License Agreement with Stroscher Enterprise to add temporary parking on the site of the former Walnut Grove Restaurant until such time as the property could be redeveloped. During the meeting some Council Members expressed a desire to add mature landscaping and lighting to the temporary lot, while others were concerned with the costs of temporary improvements. The Second Amendment was approved with the condition staff return with itemized bids for the Council's consideration. Below is a breakdown of the quotes received for the temporary improvements to the Walnut Grove lot. Company Grading and Lighting Irrigation and Lowest Fee Paving Landscaping Nelson Paving $1161980.00 Sanders Paving $116,607.00 Imperial Paving $ 92,400.00 $ 92,400.00 Lewis Electrical $25,500.00 $ 25,500.00 A.C. Landscape $37,627.03 $ 37,627.03 Total $155,527.03 The fee quotes received are in a range that exceeds a reasonable expense for temporary improvements. To that end, staff is recommending the City Council take action to terminate the Second Amendment to the License Agreement with Stroscher Enterprise and redirect the $55,000 earmarked for the Walnut Grove lot improvements Agenda Report June 5, 2007 Page 2 towards permanent lot repairs in the Capistrano Depot north lot. BACKGROUND: On August 1, 2000, the City approved a License Agreement with Stroscher Enterprise, LLC, a family partnership, to place a temporary public parking lot on the northeast corner of EI Camino Real and Ortega Highway, site of the former Arco fueling station. The temporary public parking lot was put in place to accomplish several goals. They were: a. To eliminate a blighted nuisance created in the heart of the Downtown when the gas station was razed in 1999. b. To create additional public parking to meet the increasing demand in the Downtown. c. To place a desirable temporary use on the property until a future redevelopment project could be fostered with the family partnership and remaining business interest. Immediately adjacent to this temporary parking lot was the former Walnut Grove restaurant. The Walnut Grove restaurant was closed in 2004 and its leasehold interest extinguished. The building was razed in September of 2005. The family partnership which owns these properties was reorganized in 2006. The City was approached by the current Licensor Stroscher G3, LLC, and the successor in interest from Stroscher Enterprise, LLC, about adding the former Walnut Grove Restaurant property to the temporary public parking area. On December 19, 2006, the City Council approved the Second Amendment to the License Agreement with Stroscher G3, LLC, to provide for additional temporary public parking spaces subject to the project costs returning for their consideration. Staff was proposing minimal improvements and anticipated the expense to be approximately $55,000. See financial considerations below. Capistrano Depot North Parking Lot In 1995, the Redevelopment Agency granted to the City reciprocal public access Agreement through the Capistrano Depot north parking lot prior to selling the property. The intent was to maintain public ingress and egress to the Multi-modal parking lot through the Capistrano Depot lot via Camino Capistrano. The Agency then sold the Capistrano Depot property to Manna Station, Inc. In the reciprocal public access agreement the Agency is responsible for all maintenance of the area covered by the agreement, including but not limited to, sweeping, landscape maintenance, filling of pot holes, cracks and overlay of pavement, parking lot lighting, signage and striping. A copy of the agreement is provided as Attachment 1 to this report. The Agency has been noticed by Manna Station of the maintenance obligation and the Agenda Report June 5, 2007 Page 3 current condition of the lot. The lot has not received any maintenance since the sale of the property a dozen years ago and the condition of the pavement, speed bumps, and concrete drainage swale has deteriorated to the point that replacement is necessary. Quotes for the Capistrano Depot parking lot repairs have been solicited and range from $45,000 to $88,000. Staff is recommending the $55,000 earmarked for the temporary Walnut Grove parking lot be redirected toward the repairs of the obligations of the Reciprocal Public Access Agreement. COMMISSION/BOARD REVIEW AND RECOMMENDATIONS: A temporary use permit (TUP) for temporary public parking lot improvements was processed before the Planning Commission on January 9, 2007. The Planning Commission took the following action: Commissioner Drey moved, seconded by Chairman Cardoza, to adopt Resolution 07-1-9-2 approving temporary parking lot design located at 26871 Ortega Highway(Walnut Grove site)and granting exception for deviation from Municipal Code Section 9.3-602 (D)(2) et. al., with the condition that prior to the use of the parking lot after dark staff conduct lighting tests and provide assurances that minimum light standards have been met to the satisfaction of the City Attorney and Planning Director, with a site review by the Planning Commission. FINANCIAL CONSIDERATIONS: Staff estimated the Walnut Grove property was capable of adding approximately 60 temporary public parking spaces to the downtown inventory. Driveway improvements, grading, paving, stripping and landscaping costs were anticipated to be approximately $45,000 to $55,000 based on past experience. Below was a history of costs incurred for providing similar temporary parking lot improvements. Lot Acquisition Improvements Spaces Year Built Texaco $1179212 $105,000 68 1995 Mitchell $ 455,957 $ 48,000 42 1995 Love $ 372,580 $ 48,000 54 1995 ARCO $ 348,000* $ 45,000 38 2000 * Rent paid from 8/1/00 to 12/1/06. Funding for the Walnut Grove improvements were to be redirected from account no. 26- 65300-4720-R04, Lower Rosan EIR to a new project account no. 26-65300-4720-Rl1 titled, "the Walnut Grove lot" to cover the anticipated expenses for the temporary improvements. Agenda Report June 5, 2007 Page 4 Rather than increase the commitment for temporary improvements at the Walnut Grove property staff is recommending the $55,000 be used for repairs at the Capistrano Depot North Parking Lot pursuant to the terms of the Reciprocal Public Access Agreement. Terminate the Second Amendment to License Agreement with Stroscher Enterprises for a Temporary Public Parking Lot at the former Walnut Grove Restaurant; and Transfer $55,000 budgeted funds to overlay the Capistrano Depot North Parking Lot. NOTIFICATION: Gretchen Stroscher-Thompson, Stroscher G3, LLC.* Guy Edwards, Manna Station, Inc.* * Received a copy of Agenda Report RECOMMENDATION: Terminate the Second Amendment to License Agreement with Stroscher Enterprises for a Temporary Public Parking Lot at the former Walnut Grove Restaurant; and Transfer $55,000 budgeted funds to overlay the Capistrano Depot North Parking Lot. Respectfully submitted, '0004,awre Douglas D. Dumhart Economic Development Manager Attachments 1: Reciprocal Public Access Agreement Recorded at the Request ofP CO and Return to: CITY CLERK'S OFFICE City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 Exempt from Recording Fees Pursuant to Government Code Section 6103 Documentary Transfer Tax: No Consideration: City initiated Public Access Agreement i CHERYL JO SOY<, CITY CLERK CITY OF SAN JUAN CAPISTRANO Project: Depot Parking Agreement AP No.: 121-141-17 Address: 26701 Verdugo Street San Juan Capistrano, CA 92675 Legal Desc: Portion of Lot 1, Book 1, Page 588, Records of Los Angeles County. RECIPROCAL PUBLIC ACCESS AGREEMENT CAPISTRANO DEPOT PARKING LOT The SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY(AGENCY) does hereby grant to the CITY OF SAN JUAN CAPISTRANO (CITY) reciprocal public access to the referenced property. Said agreement is to ensure future public vehicular and pedestrian access between Verdugo Street and Camino Capistrano (via Mission Street right-of-way, northerly Depot entry from Camino Capistrano). Said access shall encompass the parking area as shown on Exhibit "A" attached hereto and made a part hereof. CITY shall defend, assume all responsibility for, and hold the AGENCY, its successors, employees and agents, harmless from all claims or suits for any damages to property or injuries to persons including accidental death, which may be caused by CITY'S use of said area for public access, provided, however, that CITY shall not be liable for such property damage or bodily injury occasioned by the sole negligence of AGENCY, its successors, patrons, employees or agents. ATTACHMENT 1 AGENCY and its successors in interest shall be responsible for all maintenance within the Agreement area,including, but not limited to, sweeping, landscape maintenance, filling of potholes, cracks and overlay of pavement, parking lot lighting, signage and striping. AGENCY and its successors in interest shall not modify, improve or inhibit public use of the pedestrian/vehicular access area as shown on Exhibit "A" without prior written approval from the CITY. This Agreement shall become effective upon its recordation with the Orange County Recorder and shall not be terminated except upon the written consent of the CITY and the AGENCY or its successors. The covenants contained herein shall be burdens upon and shall run with the property for the benefit of the CITY and shall be binding upon the AGENCY and the AGENCY'S successors, assigns and tenants. IN WITNESS WHEREOF, this instrument has been executed this day of UiJ lq 1995. Vr VI S RDLIN, CHARUVLAN, SAN JUAN CAPISTRANO REDEVELOPMENT AGENCY ATTEST: CHERYL J N, CITY CLERK APPROVE AS TO FORM: HARD DENHALTER, CITY ATTORNEY 1 NORTH Wcros W - Q v W p W ' % a ,MISSION W SAN JUAN CAPI STRANO p MR 1. MULTI-MO �p W � ' I o I ` W low VERDUGO STREET