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RA1997/07/15ANAHEIM CITY HALL, ANAHEIM REDEVELOPMENT AGENCY JULY 15, 1997 PRESENT:AGENCY MEMBERS: Shirley McCracken, Tom Tait, Bob Zemel Lou Lopez, Tom Daly ABSENT:AGENCY MEMBERS: None PRESENT:CITY MANAGER: James Ruth CITY ATTORNEY: Jack White SECRETARY: Leonora N. Sohl EXECUTIVE DIRECTOR OF COMMUNITY DEVELOPMENT: Lisa Stipkovich A complete copy of the agenda for the meeting of the Anaheim Redevelopment Agency was posted at 2:55 p.m. on July 11, 1997 at the City Hall Kiosk, containing all items as shown herein. Chairman Daly called the regular meeting of the Anaheim Redevelopment Agency to order at 5:55 p.m. FINANCIAL DEMANDS AGAINST THE ANAHEIM REDEVELOPMENT AGENCY in the amount of $60,216.55 for the period ending July 11, 1997, in accordance with the 1997-98 Budget, were approved. ADDITIONS TO THE AGENDA: There were no additions to agenda items. ITEMS OF PUBLIC INTEREST: No items of public interest were addressed. PUBLIC COMMENTS - AGENDA ITEMS: There were no public comments on Redevelopment Agency agenda items. 123: Accepting the low bid, and authorizing the execution of an Agreement with Ace Parking Management, DBA SoCal Security Services, in an amount not to exceed $560,354 for a two year period beginning August 1, 1997, with four one-year optional extensions for security guard services at City Hall, City Hall West and various other Anaheim locations, in accordance with Bid #5647. On motion by Mayor Daly , seconded by Council Member Zemel, the subject agreement was approved. MOTION CARRIED. CONDEMNATION HEARING - 806 N. BROOKHURST STREET (HOME DEPOT 121: PROJECT): To consider adoption of a resolution finding and determining the public interest and necessity to acquire certain real property interests in real property located at 806 North Brookhurst Street in the City of Anaheim (Home Depot project) and authorizing the condemnation of those certain real property interests. This matter was continued from the meeting of July 8, 1997 to this date. Submitted was report dated July 8, 1997 from the Community Development Department recommending approval of the subject action. Agency Member Tom Tait. He must declare a potential conflict of interest on this item and will, therefore, be abstaining from any discussion or decision. (Mr. Tait temporarily left the Council Chamber 5:57 p.m.). ANAHEIM CITY HALL, ANAHEIM REDEVELOPMENT AGENCY JULY 15, 1997 Chairman Daly. Now is the time for the hearing on the proposed acquisition by eminent domain of certain real property interests required for redevelopment purposes located at 806 N. Brookhurst Street in the City of Anaheim. He asked first to hear from staff. Lisa Stipkovich, Executive Director of Community Development. In addition to briefing the staff report dated July 8, 1997 recommending adoption of the proposed resolution, she explained this is also an issue regarding the Brookhurst Corridor Project which is the Redevelopment Project in the west end of Anaheim. Staff has been working for several years with Home Depot resulting in a Disposition and Development Agreement (DDA) which required them to gain control of a site to build a new Home Depot facility. The project approved in the DDA consists of a new Home Depot, its parking lot and circulation. The Redevelopment Plan calls for commercial development in the area. Home Depot gained control of the largest portion of the property, the IDM site, and also an agreement to purchase the White property. The one area they do not have control over is the leasehold interest held by the tenant that is the subject of the hearing tonight. The White property is just as crucial as the IDM property. The IDM property has been vacant for at least eight to ten years and is a real blight on the Brookhurst Corridor. It has been the subject of numerous code violations. They do not see any way the project can move forward without Home Depot acquiring the leasehold interest. The tenants, the Kims, have been working with City staff and the City’s consultants and have been meeting with them to try to find a relocation site, specifically, a site at Manchester and Broadway. They will continue to work on addressing their need to relocate and to get whatever entitlements are necessary. The issue they have not been able to resolve is the value of the leasehold and the cost of moving. It is not an issue tonight but one they are still negotiating and intend to continue to negotiate after the resolution is adopted. Mrs. Stipkovich then explained additional factors involved noting that the area is one where they need to have new development. Due to all of the factors and the long-term negotiations regarding this property over a significant period, they believe it is in the interest of the public to see the property developed in the manner proposed which will have the least private impact. Legal Counsel is also present to answer questions. Chairman Daly. He will now open the hearing and ask if the property owner or his/her representative is present. Only the property owner or his/her representative may present testimony and only on the following issues: 1. Does the public interest and necessity require the project. 2. Is the project planned and located in a manner that will be most compatible with the greatest public good and the least private injury. 3. Is the property sought to be acquired necessary for the project. 4. Has the offer required by Government Code Section 7267.2 been made to the owner. Chairman Daly asked that the property owner or a representative come forward and give their name and address for the record. Mr. Yong Kim, General Manager, Brookhurst Motor, Inc., 806 N. Brookhurst St., Anaheim. He gave the background of his business which was established in August, 1993 noting that they are also currently the official Police impound yard for Anaheim, Buena Park and the California Highway Patrol (CHP). They also service the Fullerton Police Department. When the company was started, they suffered a big loss for the first two years. The total investment so far is about $700,000 including the loss. They have started to generate more business and are now on their feet. They currently have 25 employees and do $2 million a year in gross sales. They also repair Anaheim City vehicles. The business is unique because there are time limits placed on them which means they have to respond within 15 minutes to any part of Anaheim (except Anaheim Hills), Buena Park, Fullerton, and the 91 and 5 Freeways. The Manchester and Broadway property will work for all except the northern part of Buena Park which is 40% of their business as well as some parts of Fullerton and the 91 and 5 Freeways. The new location is over eight minutes away from the current location. They currently have 300 vehicles in their lot and are responsible for them until they are picked up which takes from 30 to 100 days. If the condemnation starts, they will not be able to take in any vehicles immediately which means they would have to shut 2 ANAHEIM CITY HALL, ANAHEIM REDEVELOPMENT AGENCY JULY 15, 1997 down immediately. They have been working with the Anaheim Redevelopment Agency for the past two months and appreciate their effort and generosity. They are still willing to work with them on the issue.They do not want the City’s project to go down the drain; however, they feel it will be a great risk if they move from a primary location to a secondary one. They have to look after their interests and that of their 25 employees. Barry A. Ross, 1750 E. 4th Street, Santa Ana, Attorney for Brookhurst Motor, Inc. He submitted and then read letter dated July 15, 1997 (made a part of the record) which gave five reasons for his client’s objection to the proposed resolution of necessity having to do with their belief that the Agency has not complied with the California Environmental Quality Act because of inadequate environmental review, not providing an adequate pre-litigation offer, improper noticing of the Public Hearing on the City’s amendment of the General Plan, change of zoning and the variance regarding the subject property, that the public interest and necessity do not require the project, and that the Agency’s relocation obligations have not been fulfilled. Baldwin Keenan. He is with the Carpenter’s Union and would like to make general comments on what they find might be a problem regarding the development with Home Depot. The Carpenter’s Union feels as a major corporate representative of the U.S. they (Home Depot) should provide some guidelines and some demands of their contractors so that the contractors provide health insurance to workers and also do not employ or exploit workers from other countries where they do not even have legal working papers. Mr. Santiago Arana will also speak to this issue. They do not feel Home Depot should be granted any favors until they stop these practices. Mr. Santiago Arana, Anaheim resident (31 years), 3126 W. Coolidge, Anaheim. Home Depot hires contractors to build their stores that pay low wages. He then named the contractors he is personally aware of in Pomona and Garden Grove and alleged that truckloads of illegals are being brought in from San Fernando. He talked to some of the workers and they told him they cannot ask for more wages because they have a problem. They are hired at low wages with no insurance or retirement. As a citizen and resident of Anaheim, he does not think it is fair to the workers and their families that make a living in Anaheim. They want decent-paying jobs to support their families. City Attorney, Jack White interjected and stated that the comments by the last two speakers are not relevant or responsive to the four criteria that are the subject of tonight’s hearing as outlined by the Chairman. The purpose of this hearing relates only to those four issues. Jim Flores. One of his big concerns is that Home Depot has become notorious for day workers standing in front of their stores and parking lot. He has not seen this issue addressed at any location where they have built a store and are in business. Both the community and Home Depot have the responsibility to stop this practice. He also addressed the issue of the hiring of immigrant laborers. In closing, he requested that in their negotiations with Home Depot they address the day workers issue, require security at their stores, and ask what their plans are to require the contractors who build the project to hire construction workers who live in the City. Agency Member Zemel explained for Mr. Flores that the issue of the day laborers has been addressed at every prior meeting on the subject. There is an agreement between Home Depot and the City to do a better job at this location relative to eliminating the day laborer problem. The other issue(s) he spoke about are not relevant to this hearing. Gilbert Badillo, 113 N. Deseret, Anaheim. As a citizen of the City, he urged the Agency to vote no because he does not understand how a big company can come in and push a small company out. Chairman Daly closed the Condemnation Hearing. 3 ANAHEIM CITY HALL, ANAHEIM REDEVELOPMENT AGENCY JULY 15, 1997 Lisa Stipkovich, Executive Director of Community Development. Regarding Mr. Ross’ remarks, staff feels they have complied with all requirements of the law relative to this matter. Regarding relocation benefits, they have been discussing those in general and will continue to do so when they are more involved with the specific relocation to the site. In terms of the other items contained in his (Ross) letter of July 15, 1997, staff believes they have followed the proper procedure. Chairman Daly. He asked the City Attorney if there was a desire for a brief visitation in closed session of some of the questions raised before a vote on the matter. He asked the proper procedure. City Attorney White. The Agency could request a recess to consult with legal counsel in closed session relating to this potential litigation matter. MOTION. Chairman Daly moved to recess into closed Session. Agency Member Lopez seconded the motion. Agency Member Tait was temporarily absent. MOTION CARRIED. (6:27) AFTER RECESS: Chairman Daly called the meeting to order, all Agency Members being present with the exception of Agency Member Tait. (6:37 p.m.) Chairman Daly. The hearing has been opened and subsequently completed. He asked if there were any additional comments from staff. (There were none.) Chairman Daly thereupon offered a resolution finding and determining the public interest and necessity to acquire certain real property interests in real property located at 806 N. Brookhurst Street and authorizing the condemnation of those certain real property interests. Before further action was taken, Agency Member Zemel stated, as a Planning Commissioner in 1991, he voted and led the charge to get Brookhurst into a Redevelopment area in order to clean up the area and eliminate some of the undesirable businesses; however, he has a concern when in order to do so it requires taking another man’s property. They cannot take a leasehold interest and make it any less. It is a right to property. It would appear they would be exercising condemnation rights for not necessarily a greater good with the least private injury but instead would be hurting a smaller business for the benefit of a larger one. Cleaning up Brookhurst has been a priority and that’s what makes this a difficult decision. In this case, he is going to be supporting property rights and will be voting against the proposed resolution. He believes that the offer is very adequate but the man is saying he does not want to lose his business for that price. Agency Member Lopez. He is also going to vote no basically for the same reasons and also for the welfare of Mr. Kim’s 25 employees and what will happen to them. He hopes that the City will sit down and talk to the owners again so he can be totally satisfied that the employees and owners interests will be handled. They should take care of the businesses that are currently on the property before letting Home Depot take the site. Agency Member McCracken. She is also going to vote no. She believes as Mr. Zemel perhaps it might be in the better interest of the Kim’s if they did condemn the property and force them into some type of negotiation. She is hoping it will go forward in any case and they will be given an opportunity to relocate. Perhaps they could purchase property instead of leasing and thereby have a permanent home for their business. She would like the negotiation to continue, the issue(s) resolved and that there be adequate compensation in order for the business to relocate. 4 ANAHEIM CITY HALL, ANAHEIM REDEVELOPMENT AGENCY JULY 15, 1997 Chairman Daly. He offered the resolution in support because the property in question is a prominent location in the heart of the City that has been vacant for 10 years. There are disputes among the property owners. The subject business which has been in business for about 3-1/2 years has eight years remaining on a lease. They are the recipient of a couple of different City contracts which have allowed their business to grow and prosper. Meanwhile, those who live in West Anaheim, where the bulk of the City’s population resides, are stuck with looking at an eyesore which affects values for miles around. One property owner is standing in the way of progress, improvement and revitalization of one of the key properties along a major street in the heart of the City. While it is a difficult call, he comes down on the side of progress. This is the purpose of Redevelopment. He believes if condemnation takes place, the business owner will be adequately, reasonably and fairly compensated. If they had not condemned properties in the past, many of the projects that have improved the City which they all enjoy, are for the greater good, and marvelous assets for the community, would not have occurred at all. There is a proper time and place for condemnation and this is one of those cases. Hopefully, they will be able to keep trying to find a way to make it happen. RESOLUTION NO. ----- A RESOLUTION OF ANAHEIM REDEVELOPMENT AGENCY FINDING AND DETERMINING THE PUBLIC INTEREST AND NECESSITY TO ACQUIRE CERTAIN REAL PROPERTY INTERESTS IN REAL PROPERTY LOCATED AT 806 NORTH BROOKHURST STREET IN THE CITY OF ANAHEIM, AND AUTHORIZING THE CONDEMNATION OF THOSE CERTAIN REAL PROPERTY INTERESTS. A Roll Call vote was then taken on the proposed resolution and failed to carry by the following vote: Ayes: Daly No: McCracken, Zemel, Lopez Temp. Absent (abstained): Tait ADJOURNMENT: Chairman Daly moved to adjourn, Agency Member Lopez seconded the motion. MOTION CARRIED. (6:50 p.m.) LEONORA N. SOHL SECRETARY 5