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1975/04/07Anaheim Convention Center, 800 West Katella Avenue, Anaheim, California Orange Room - COUNCIL MINUTES - Ap.ri! 7~ 1975~ 4:00 P.M. The City Council of the City of Anaheim met in adjourned regular session. PRESENT: COUNCIL MEMBERS: Kaywood, Seymour, Sneegas and Thom (arrived 4:55 P.M.) ABSENT: COUNCIL MEMBERS: Pebley PRESENT: COMMUNITY CENTER AUTHORITY: Bob Hostetter, Larry Henderson, Burr Williams, Bill Currier, and Ben Shroeder ABSENT: COMMUNITY CENTER AUTHORITY: None PRESENT: ANAHEIM UNION HIGH SCHOOL DISTRICT BOARD OF TRUSTEES: K. Wines, J'. Butterworth, J. Barton, D. Pritchett, and M. McGee ABSENT: ANAHEIM UNION HIGH SCHOOL DISTRICT BOARD OF TRUSTEES: R. Bark PRESENT: CITY MANAGER: Keith A. Murdoch CITY ATTORNEY: Alan R. Watts DEPUTY CITY ATTORNEY: William Hopkins CITY CLERK: Aloha M. Hougard FINANCE DIRECTOR: M. R. Ringer PUBLIC WORKS DIRECTOR: Thornton Piersall TRAFFIC ENGINEER: Paul Singer STADIUM-CONVENTION CENTER DIRECTOR: Thomas Liegler At 4:30 P.M., there having been established a quorum of the Community Center Authority and City Council, Chairman Shroeder and Mayor Pro Tem Seymour COnvened the respective entities to a Joint meeti~ of the Community Center Authority, City Council, and Anaheim Un'ion High School District Board of Trustees. Said meeting was requested by the City Council at their meeting of April 1, 1975. Mayor Pro Tem Seymour related that the purpose of the requested joint meeting wa8 to discuss the subject of providing the additional parking spaces required at the Convention Center by construction of a parking structure or by acquisition of additional property. Further, at the last Council meeting, Mr. Bill Asawa offered the undeveloped property located south of Convention Way at a substantially lower price than it was previously offered. 75-305 Cit. M Hall, Anaheim, California - COUNCIL MINUTES - April 1, .1975, 1:30 P.M. RESOLUTION NO. 75R-174 - WORK ORDER NO. 713-B: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANAHEIM FINALLY ACCEPTING THE COMPLETION AND,THE FURNISHING OF ALL PLANT, LABOR, SERVICES, MATERIALS AND EQUIPMENT AND ALL UTILITIES AND TRANSPORTATION INCLUDING POWER, FUEL AND WATER, AND THE PERFORMANCE OF ALL WORK NECESSARY TO CONSTRUCT AND COMPLETE THE FOLLOWING PUBLIC IMPROVEMENT, TO WIT: THE SUNKIST STREET AND LINCOLN AVENUE STREET IMPROVEMENT, IN THE CITY OF ANAHEIM, WORK ORDER NO. 713-B. (Steiny and Company, Inc.) Roll Call Vote: AYES: COUNCIL MEMBERS: Kaywood, Seymour, Pebley, Sneegas and Thom NOES: COUNCIL MEMBERS: None ABSENT: COUNCIL MEMBERS: None The Mayor declared Resolution Nos. 75R-168 through 75R-174, both inclusive, duly passed and adopted. LIFELINE UTILITY RATES: Councilwoman Kaywood acknowledged receipt of memorandum from the Utilities Director dated March 18, 1975, describing the status of the Lifeline Utility Rate Study. ESTABLISHMENT OF GOLF COMMITTEE: Councilman Seymour indicated his agreement with the action taken by the Council during his absence at the meeting of March 25, 1975, authorizing a Management Practices Audit of the two municipal golf courses because he feels the data provided to date by City staff is totally inadequate to enable the Council to make an intelligent business or investment decision on this matter. Therefore, Councilman Seymour stated if there is not sufficient expertise on the City staff to properly counsel with regard to financial decisions of this magnitude, then such guidance must be sought from the public sector until such time as the Council may decide to have private enterprise operate these courses. He proposed that the Council initiate a seven member golf commission with representative membership from the interested men's and women's golf clubs at the Anaheim Municipal and Anaheim Hills Golf Courses, and further that some public members, ideally businessmen, be included who would view the golf course operation as a business enterprise. He indicated he had discussed this golf commission concept with the Anaheim Chamber of Commerce and they are in agree- ment. Such a commission he felt should operate in an advisory capacity to develop data which would enable sound businesslike decisions. The City Attorney advised that unless the Council intends this commission to be of a temporary nature, it would be appropriate to create such commission by ordinance. Councilman Seymour was of the opinion that until Arthur Young & Company completes the studies of the golf courses that this body should remain in com- mittee form. Councilman Seymour moved that the City Council initiate a seven-member golf commission and that Council be prepared to name individuals to same in a two-week period; that this commission remain in committee form until Arthur Young & Company completes the Management Audit of the golf courses; that the City Attorney be instructed to draft a document setting forth the advisory responsibilities of such golf committee. At the suggestion of Councilman Thom, Councilman Seymour agreed to amend his foregoing motion to include that one of the goals to be established for the golf commission be to formulate a method with which to divorce golf course functions completely from all City departmental ties, setting these courses up as separate independent activities. Councilman Thom seconded the motion as amended. MOTION CARRIED. RECESS TO EXECUTIVE SESSION: Councilman Thom moved to recess to Executive Session. Councilman Seymour seconded the motion. MOTION CARRIED. (6:00 P.M.) AFTER RECESS: The Mayor called the meeting to order, all Council Members being present. (6:12 P.M.) 75-307 Anaheim Convention Center, 800 West Kmtella Avenue, Anaheim, California Orange Room - COUNCIL MINUTES - April 7~ 1975, 4:00 P.M. Dr. Pritchett arrived at the meeting, and the Anaheim Union High School District Board of Trustees officially convened their meetin8. Mr. Asawa, Post Office Box 220, Westminster, California~ posted a map of the Convention Center and surrounding properties and advised that he represents one of the property owners of the approximately 28.58 acres of ground lying southerly of the Convention Center. He made essentially the same presentation as was given before the City Council on April 1, 1975, (see Minutes Page Nos. 75-300, 75-301, and 75-302). Briefly he noted that although it has been stated the subject property which he represents was offered to the City for $200,000 per acre, this was not the case and that these property owners were not aware of the Community Center Authority decision to proceed with construction of the parking structure until they read the news article printed in the Times on March 5, 1975. He further noted that there are some 275 acres of undeveloped land in the area around the Convention Center, some of which has been recently placed into an Agricultural Preserve, and the potential for hotel-motel develop- ment appears at this point to be saturated. Mr. Asawa contended that the Convention Center facility is in a unique situation, having vacant and available land located adjacent to it and that the usual reason for construction of parking structures is that land is not available. Mr. Asawa indicated that the property owners are in a position to include in their offer that they will work out a financing program, by which they would carry the property on their own behalf and will also make it reasonable for the City to acquire. In regard to the concern usually expressed about taking property off of the tax rolls, he related that the taxes on this vacant property are minimal and that the people who are carrying the major tax burden, the businesses and motels established in the Convention Center area, would be happy to have the opportunity to use and even to pay for additional parking spaces. Mayor Thom entered the meeting and assumed Chairmanship of the meeting. (4:55 P.M.) Councilman Seymour inquired if Mr. Asawa would explain more specifically the financing program which the property owners have in mind. Mr. Asawa related that the plan for purchase would be that the City pay 10% down and finance the balance for up to 25 years at 7% interest. Copies of his original letter dated March 24, 1975, addressed to Mayor Thom were distrib- uted to the Community Center Authority. Councilman Seymour inquired if the price at which the property is being offered this date is the same am quoted in that communication, i.e., $3.04 per square foot, and Mr. Asawa advised that he would ask each property owner to speak to the matter of price themselves so that there will be no doubt. As requested by Councilman Sneegas, Mr. Asawa pointed out on the map posted the 28.58 acres of property lying south of the existing Convention Center parking lot which was under discussion. Dr. Pritchett asked what the walking distance would be to the Convention Center from this proposed area for parking and how it would compare to the Disneyland parking lot. Further he inquired whether or not the Convention Center would need to consider providing a shuttle service from this area. Mr. Asawa stated that the property would be contiguous to the existing ?arking area except for Convention Way and is located a total depth from the Convention Center facility of 2,600 feet, or 800 feet from the front door, which is within walking range. Further he noted that when there is peak activity at the Convention Center, the patrons have used adjacent residential streets and motel and hotel parking and in some cases have gone onto subject property to park their cars. Mr. Hostetter recalled that three years ago this property was available at a substantially higher price and inquired what has prompted the generous reduc- tion. Mr. Asawa advised that the property owners will realize a tax advantage by selling to a municipal corporation. :' :' ~--~ ~ Ill lll , I i. I i i u i ~ i i i 75-? ~)8 Anaheim Convention Center, 800 West Katella Avenue, Anaheim, California Orange Room - COUNCIL MINUTES - April 7~ 1.975~ 4:00 P.M. Mr. Abraham Eidelson, 1788i Rommell, Santa Ana, advised that Mr. Asawa is not representing himself nor two other property owners, Ida Carey and Hazel Powell, both of whom are his long standing neighbors and friends and who have asked him to represent them. He related the history of his coming to Anaheim to purchase this property in 1941 and he stressed that neither he nor his neighbors pur- chased this property with the intention of selling it, but rather to remain on it as agricultural land. He related various difficulties which have been encountered in the use of parking structures elsewhere and noted the higher cost per square foot of structure parking as compared to parking on flat land. He stated that the Quality Inn would very much like to have the availability of additional parking at the Convention Center, especially to use for banquet parking. Mr. Eidelson stated that according to his calculations, in order to earn 7H% on the investment in a parking structure, each space would have to be utilized 365 days per year. However, if the adjacent vacant land were developed into a parking lot, to earn 8% on that investment, those parking spaces would have to be utilized only 2 days per week. He urged the Community Center Authority, Council Members, and Trustees present to look 50 years to the future and stated that he felt the parking structure approach is short-sighted from a tax viewpoint. He advised that he is willing to sell his property for $3 per square foot or approximately $132,000 per acre, provided that he not receive the capital on the property, but that the City pay on the interest only on a long-term basis, up to 25 years. During discussion of the price at which the property is being offered, each of the four property owners involved, Mr. Eidelson, Mrs. Ida Carey, Mrs. Hazel Powell, and Mr. Zaby, confirmed that they would be willing to offer their respective properties at a price of $3.00 per square foot or approximately $130,680 per acre. In reply to Chairman Shroeder, Mr. Eidelson advised that the interest rate which he proposes would be 7% on that portion of the property which the City actually uses for parking and 3~% on any which is held in reserve. He indicated that he was speaking for Mrs. Powell and Mrs. Carey as well. Mr. Zaby indicated agreement with the interest rates set forth by Mr. Eidelson. Chairman Shroeder briefed those present on the structure of the Community Center Authority and their duties and responsibilities. He explained that the Community Center Authority, which haB the responsibility of construction and operation of the Convention Center, has wrestled with the problem of the neces- sary additional parking for the past three years and that the matter was dis- cussed many times at their meetings, which were open to the public. He advised that they have taken into consideration the potential removal of some $53,360 per year in actual taxes paid to the City and School Districts from subject properties. Further, they have to consider crowd control and the provisions necessary for the welfare and safety of the people who would use the proposed parking lot. This would pomsibly necessitate the installation of traffic signal systems or a bridge or tunnel to cross Convention Way. He summarized that the matter has been carefully considered over a lengthy period of time and the Community Center Authority has determined that they will not invest further monies in property for parking, but will build the parking structure proposed unless the City wishes to acquire some or all of the property which has been offered, in which case they would then develop this for parking. In the latter event, the funds left in the bond account would be'returned to the investment company to retire the bonds, He called upon mamber~ of the Authority to correct him if he was wrong in summarizing the decision which they had made. Mr. Currier stated that he was basically in agreement with Mr. Shroeder's remarks, however, in light of the additional information on firm prices received this date he would prefer that the final decision on the parking structure be withheld to allow the members time to digest same. In answer to Councilwoman Kaywood, Mr. Shroeder explained that the Authority is working with bond monies and not tax revenues. There would be a legal problem in the Authority purchasing the property in the manner proposed. He advised that the Authority receives rent only on the structure from the City, which would probably not be sufficient to cover this acquisition even at $3 per square foot. 75-309 Anaheim Convention Center, 800 West Katella Avenue, Anaheim, California Orange Room - COUNCIL MINUTES - Ap~i.1 7~ 1975~ 4:00 P.M. Mr. Watts advised that the funds used by the Community Center Authority are already in a trust fund of sorts and he supposed that further legal arrange- ments could be made, however, he did not think the Community Center Authority could gain sufficient money from the funds left to pay off the capital indebted- ness in the type of arrangement proposed unless some sort of amalgamation was formed with the City to accomplish this purpose. Mr. Ringer read from the financial report dated December 31, 1974 that the balance of the trust deed on Community Center Authority Bond Issue Series B was $2.8 million dollars, $2.1 million dollars o£ which is unrestricted for parking. Mr. Currier interpreted that the Expansion Fund §eries B Bonds are avail- able for land acquisition with which Mr. Ringer and Mr. Watts concurred. Councilman Seymour voiced the opinion that the question which first must be answered is would it be a better business decision to buy the land at $3 per square foot or to build the parking structure. Once this has been decided, the method to implement the decision can be ascertained. It was determined to be the general consensus that the entire acreage offered would not be necessary. Mr. Shroeder advised that the additional parking needs at the Convention Center are for a maximum of 1,400 spaces and that no more than 4½ acres would be required. Mr. Eidelson stated that his quoted price would remain the same and that he would be willing to sell a portion of his property under the same terms. He additionally related the number of times Mrs. Powell has attempted to contact the City regarding sale of her property during the period 1970 through 1974. Councilman Seymour stated that the Community Center Authority has an idea of the fixed cost of the parking structure and if this were compared on a grap~! with a sliding scale of land values, these two lines would intersect at some point; once this point is determined, the appropriate decision would be clearly discernible. Further Councilman Seymour questioned, since the Community Center Authority needs are between four and five acres and the current estimate of cost for the proposed parking structure is $1¼ million whether the Community Center Authority has pursued the possibility of leasing these necessary addi- tional spaces. He noted that the differential between the annual debt and the interest accrued on the principal sum of $2.1 million, which amounts to approxi- mately 5%, is a $100,000 annual yield which could be utilized to lease and develop additional parking spaces, while keeping the principal intact. Member of the Anaheim Union High School District Board of Trustees Molly McGee arrived at the meeting. (5:15 P.M.) There was brief discussion regarding the prevailing money market and the prospect of continuing to receive the 5% differential pointed out by Councilman Seymour. Councilman Seymour contended that a lease arrangement could be handled with as low as a 2½% differential. Councilman Seymour stressed that the future is not crystal clear, that there may be changes in transportation systems which will ultimately decrease the parking space requirements at the Convention Center and, therefore, it might be judicious to "tread water" i.e., to meet the present day parking need at the Convention Center in a manner which will preserve the Community Center Authority capital. Brief discussion was held regarding the period of time which the Community Center Authority could hold the bonds and collect just the interest, and it was ascertained that there is a provision in the bond indenture which requires the Community Center Authority, once expansion is complete, to make a finding to this effect and transmit to the Trustee any of the bonds issued and they in turn are required to do certain things with these funds. There is some element of uncertainty as to time, certainly a contract agreement requiring the use of these funds for the term of said contract for additional parking spaces would be sufficient commitment. 75-310 Anaheim Convention Center, 800 West Katella Avenue, Anaheim, California Orange Room - COUNCIL MINUTES - April 7~ 1975~ 4:00 P.M. Councilwoman Kaywood advised that when the price of the property was extremely high her mind was made up that the parking structure was the optimum way to provide the needed additional spaces. However, the offer of $3 per square foot, she felt, changes the complexion of the situation. She noted that there are indications that there may be changes in life styles particularly in relation to transportation; the City is looking into a intermode transportation system, so it is possible that in the future the parking needs at the Convention Center will be different. If the Community Center Authority goes to the expense of building a parking structure, should there be a reduced need for it in the future they will still have a structure which is not usable for any other purpose and which, in her opinion, may not be the most attractive facility to be placed on the Convention Center grounds. She felt that some arrangement could be made to lease or purchase the vacant land available which is within walking distance and it could then be sold, if not needed, in the future. Councilwoman Kaywood left the meeting. (5:45 P.M.) Mayor Thom summarized that the dilemma is to determine whether the parking structure or small amount of additional acreage will be used for parking. From the conversation, he gathered neither of the bodies present was interested in acquisition of all of the properties offered. Speaking personally, he indicated he would approve a parking structure and could not entertain the acquisition of all of the property offered. Councilman Sneegas commented that in the past he too felt the price and other problems inherit in land acquisition justified the parking structure, however, in view of the offer just made he would prefer to see the additional parking spaces provided on the ground for the five acres which are required, and then if a need still exists in the future, a parking structure could be constructed. Councilman Seymour related his difficulties in making this type of decision when adequate financial alternatives and analysis have not been supplied. He referred again to the graph on which there has to be an intersecting point at which the cost of land versus construction can become compared and an intelli- gent decision made. Mr. Murdoch commented that the last time the three bodies discussed this subject, the consensus seemed to be that there was no longer any interes~ in acquisition and development of land for parking other than the structure. This consensus was apparent to staff members and consequently all land negotiations were dropped. If Council and the Community Center Authority now would prefer to have staff prepare an analysis of the alternative possibilities of land acquisition and development to meet the Convention Center parking needs, this could certainly be accomplished, but not in time for the Community Center Authority meeting this evening. Mayor Thom inquired whether the Community Center Authority would be willing to delay signing of the contract, pending receipt of this financial information if a time limit were placed on the preparation of same, to which Chairman Shroeder replied that this subject matter has been delayed and discussed and has now passed the time limits established by the Community Center Authority. Dr. Pritchett advised that he would be willing to go along with the best judgment of the Community Center Authority on the matter. He suggested for safety considerations and crowd control, that Convmntion Way could be modified into a cul-de-sac and part of it used as a portion of the parking lot itself. He called for opinion from the remainder of the Board of Trustees. Mr. John Barton felt the Board of Trustees should continue to accept the judgment of the Community Center Authority and noted that their track record has proven them extremely successful. Dr. Butterworth remarked that statements made regarding the possible financial impact on the School District of removing property from the tax rolls will no longer be valid under the new laws to implement the Serrano-Priest decision which holds that a child's education will not be a function of his parents wealth. 75-311 Anaheim Convention Center, 800 West Katella Avenue, Anaheim, California Orange Room - COUNCIL MINUTES - April 7~ 1975~ 4:00 P.M. Miss McGee indicated that at the last joint session during which the parking problem was discussed, she was in favor of the above-ground structure as it would not detract from the tax base. She also felt there is the possi- bility in 4 to 5 years of a change in life style regarding transportation and would dislike the idea of an unused parking structure. She stated that she would like to know if it is feasible to acquire some of the acreage offered and further favored Councilman Seymour's idea of a graph-type financial analysis of the situation. She concurred that the Community Center Authority has made good decisions in the past and she would respect their judgment in this instance, but indicated she would like the financial analysis mentioned and also an investigation of the possibilities of leasing the needed parking spaces. At the conclusion of discussion, the Community Center Authority recessed their meeting to 7:30 P.M., April 7, 1975 in the Board Room of the Anaheim Con- vention Center. The Anaheim Union High School District Board of Trustees adjourned their meeting. ADJOURNMgNT: On motion by Councilman Sneegas, seconded by Councilman Seymour, the City Council adjourned to Tuesday, April 8, 1975, 9:00 A.M. in the Council Chamber. MOTION CARRIED. Adjourned: 6:05 P.M.