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HomeMy WebLinkAboutCC Min 1988-11-07 10-17-88 / 11-7-88 NOTICE OF CANCELLED MEETING NOTICE IS HEREBY GIVEN that the October 17, 1988 regular meetings of the Seal Beach Redevelopment Agency and the Seal Beach City Council are hereby cancelled do to the lack of quorum. The next regular meeting will be held November 7, 1988 at 7:00 p.m. in City Council Chambers, 211 - 8th Street, Seal Beach. I wth.~ of October. 1988 Joa~ne M. ~etary ~ty of Seal Beach Seal Beach, California November 7, 1988 The City Council of the City of Seal Beach met in regular session at 7:00 o~clock p.m. with Mayor Hunt calling the meeting to order with the Salute to the Flag. ROLL CALL Present: Mayor Hunt Councilmembers Grgas, Laszlo, Risner, Wilson Absent: None I Also present: Mr. Nelson, City Manager Mr. Stepanicich, City Attorney Mr. Archibold, Assistant to the City Manager Mr. Knight, Director of Development Services Chief Stearns, Police Department Mr. Jue, Director of Public Works/ City Engineer Mr. Osteen, Recreation Director Mrs. Yeo, City Clerk WAIVER OF FULL READING Wilson moved, second by Laszlo, to waive the reading in full of all ordinances and resolutions and that consent to the waiver of reading shall be deemed to be given by all Councilmembers after reading of the title unless specific request is made at that time for the reading of such ordinance or resolution. AYES: NOES: Grgas, Hunt, Laszlo, Risner, Wilson None Motion carried PROCLAMATION Mayor Hunt proclaimed October 23rd through October 29th, 1988 as "Red Ribbon Day Against Alcohol and Drug Abuse" as requested by the Los Alamitos Unified PTA Council. I RESOLUTION NUMBER 3818 - HONORING CAMERON SHAW - EAGLE SCOUT AWARD Resolution Number 3818 was presented to Council and read in part by Councilman Laszlo entitled "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEAL BEACH, CALIFORNIA, HONORING AND COMMENDING CAMERON CARL SHAW FOR ACHIEVING THE BOY SCOUTS OF AMERICA EAGLE AWARD." Laszlo moved, second by Risner, to adopt Resolution Number 3818 as presented. AYES: NOES: Grgas, Hunt, Laszlo; Risner, Wilson None: Motion carried 11-7-88 CALL TO ORDER - REDEVELOPMENT AGENCY MEETING Chairman Grgas called the regular adjourned meeting of the Redevelopment Agency to order with the Salute to the Flag. ROLL CALL Present: Chairman Grgas Agencymembers Hunt, Laszlo, Risner, Wilson I Absent: None Chairman Grgas explained that the Redevelopment Agency meeting was convened for the purpose of hOlding a joint public hearing with the City Council to consider proposed Amendment No. 4 to the Redevelopment plan for the Riverfront Redevelopment Project, afterwhich he turned the conduct of the joint hearing over to Mayor Hunt. I DISCUSSION - PROCEDURES/GUIDELINES - PUBLIC HEARINGS - PROPOSED HELLMAN LAND DEVELOPMENT Mayor Hunt suggested that the Council consider establishing alternate dates on which adjourned meetings could be held if necessary to accommodate all public comments, that a time limit per speaker be a consideration, that public testimony be concluded at approximately 11:00 p.m. with additional Council business acted upon between that hour and midnight, and that Council deliberations and actions not occur sooner than December 5th. The Mayor also asked that a clarification be obtained from Mola Development Corporation as to whether or not an extension would be considered to be granted by them in the event final action is not concluded by the statutory deadline. Discussion followed with regard to meeting dates. As previously mentioned, Councilman Grgas noted that he would be out of the City during the week of November 2lst, stating however that he would review the tape of the 2lst meeting if the public hearing is continued to that date. Mr. Kirk Evans, Mola Development, stated that at a previous meeting they had agreed to an extension through December 7th, and further extension could be considered at that time. Risner moved, second by Grgas, to hold the public hearings on the regular meeting dates of November 21st and December 5th with no Council action before the 5th, and if determined necessary, request further extension from the developer at that time. Mr. Frank Kola confirmed that if the meetings progress in an orderly manner without undue delay, they were agreeable to an extension until December 7th. AYES: NOES: Grgas, Hunt, Laszlo, Risner, Wilson None Motion carried I The City Attorney clarified that the initial deadline expired the first week of November and he understood it was extended to December 7th, with the Development Services Director adding that the written extension from the developer is, in fact, until December 9th. With the intention of allowing all persons to have the opportunity for input and expression of their opinions during the public hearings, Councilman Grgas moved that twenty minutes be allowed for a group presentation, five minutes for individual comments, with three minutes allowed for comments a second time. Councilmember Wilson seconded the motion, noting also that there should be some limitation on repetitive comments. AYES: NOES: Grgas, Hunt, Laszlo, Risner, Wilson None Motion carried 11-7-88 AGENDA AMENDED At the request of Councilmember Risner, agenda item liS" was considered out of order at this time by unanimous consent of the Council. ITEM uSn - PROPOSITION 70 GRANT FUNDS Councilmember Risner stated she had requested a brief discussion relating to grant funds and applicable deadlines for application under Proposition 70, California Wildlife, I Coastal, and Parkland Conservation Act. It was noted by memorandum from the Director of Recreation that $74,000 approved under the 1986 Park Bond Act has been recommended to be allocated to refurbish the Marina Community Center and remodel of existing restrooms to accommodate the handicapped. Mr. Osteen clarified that the first year application deadline.for Per Capita Grant funds under Proposition 70 is January 13, 19B9 for the 19B9/90 fiscal year appropriation, that the City's share is $82,000 with three years to make application, the City not eligible to make application under the Special Districts Grant Program, and confirmed the deadline under the Trails Grant Program is December I, 1988. PUBLIC HEARINGS - PROPOSED HELLMAN LAND DEVELOPMENT The City Manager announced that procedurally the staff would be making its report, the City Attorney would report on several items requested by the Council, and then a report would be made by the consultant who had been retained pursuant to previous authorization of the Agency. The Development Services Director commenced the presentation of a summarization of the comprehensive staff report, and reviewed the.background of the Hellman Ranch Specific Plan which provided for three hundred thirty-three single family I homes, five hundred sixty-seven attached units, and one hundred multi-family units, and then the amended Specific Plan which now reflects the proposed construction of six hundred sixty condominiums, one hundred thirteen single family homes and an eighteen hole golf course. He reported that since approval of the amended Specific Plan in December 1987, the project p~oponent, Mola Development Corporation, has been meeting with the Corps of Engineers and the California Fish and Game Commission and in July of this year tentative agreement was reached calling for the reconstruction of approximately twenty acres of wetlands to be located in the southwest corner of the project site. He explained that since the City had an approved Specific Plan, the Coastal Commission was requested to process the application in keeping with the wetlands restoration program, .however the Commission refused and referred the Plan back to the City for local processing, which is the current status of the development proposal. Mr. Knight noted that the proposed amendments to the General Plan and Specific Plan reflect the consultation with other agencies with regard to on-site wetlands restoration and establishing the specific acreage and jurisdictional responsibility for Gum Grove Pa~k. He reported the Planning Commission recommended amendment of the General Plan and Specific Plan to reflect the inclusion of twenty acres of wetlands in the I southwest corner of the project and reduction of the golf course by twenty acres, that Gum Grove Park acreage be set at 6.8 acres, also that the specific sixty unit condominium structure located in the southwest corner of planning area one and in closest proximity to existing residences be eliminated, which would result in the reduction of the number of dwelling units to seven hundred thirteen, gross density reduced to 4.78 dwelling units per acre, with incremental reductions to other impacts of the project. He 11-7-88 I advised that in response to the concerns of the Planning Commission, the project proponent has submitted revisions to reflect an extension of Gum Grove Park to Seal Beach Boulevard at a minimum width of twenty-five feet, relocation of the driving range to approximately one hundred ten feet from the nearest existing residential property line, and relocation of the condominium building to approximately three hundred thirty-five feet from the nearest existing residence. Mr. Knight clarified that the City now leases approximately 10.4 acres designated as Gum Grove park, 5.8 acres are the existing grove and with redesign of the driving range about four acres of that grove would remain with 2.8 acres of new plantings, the extension to Seal Beach Boulevard consistent with the City's General Plan which provides such extension as an option. He added that although the extension to Seal Beach Boulevard was the Planning Commission's adopted position, by minute order they recommended that other options should be explored to retain a minimum of 6.8 acres for Gum Grove Park. Mr. Knight reviewed the implementation actions associated with the entitlement phase of the approvals, the parcel map reconfiguring parcels of land to be used for the single family/multi-family/golf course project and providing the opportunity to further subdivide the property, the one condition of note being the requirement to dedicate eighty feet of right-of-way for First Street from Pacific Coast Highway to Hellman Ranch Road/Regency Drive. As a point of information Mr. Knight reviewed the purpose and intent of a vesting tentative map, and reported Vesting Tentative Tract Map 13198 would allow for subdivision, construction, and sale of the units, and noted the one hundred nine conditions placed on this vesting Map that cover numerous areas of interest and benefit to the City, including public facilities and infrastructure, right-of-ways, standards of construction, design and configuration, density, utilities, easements, undergrounding, street standards, soils, geology, grading, drainage, landscaping, CC&R's, mitigation measures, noise, wetlands, Gum Grove area, setbacks from fault lines, etc. Mr. Knight reviewed in detail some of the conditions imposed on the Vesting Map relating to required permits for the wetlands, submittal of precise plans for Gum Grove Park area, Quimby Act fees, credits for certain recreation facilities, non-exclusive easement for the Gum Grove Park trail, removal and replacement plan for diseased eucalyptus trees, Gum Grove irrigation plan, trail system, picnic areas and benches, Avalon Avenue pedestrian access, public roadway construction, various street and signal improvements. He noted that the conditions would be imposed over four separate phases, prior to issuance of the grading permit, prior to final map approval, prior to building permit issuance, and prior to certificate of occupancy. Mr. Knight stated there are thirty-two conditions placed on the Precise Plan covering architecture, landscaping, private recreation facilities, golf course, fencing, noise mitigation, and signage. I I Mr. Knight continued.with a review of the staff report relating to Amendment No. 4 to the Redevelopment Plan proposing land use changes to Area I and Area 20 of the Hellman site, and Area 9 and Area 10 of the Department of Water and Power property, and reported the actions of the Project Area Committee and the Planning Commission, recommending approval of Amendment No.4. He noted a separate action of the Project Area Committee, recommending that signage be retained and/or incorporated into Gum Grove Park. The Director explained that since the subject property is in the coastal zone and displays other characteristics, such as wetlands, discretionary authority 11-7-88 over this property extends beyond that of the local agency. He noted that a coastal permit would be required from the California Coastal Commission, a 404 permit under the Clean Water Act and possibly a Section 10 permit under the Harbors and Rivers Act from the U. S. Corps of Engineers, an agreement with the California Department of Fish and Game pursuant to Section 1600 of the Fish and Game Code, and a permit from the Department of Transportation for improvements to the intersection of First street and Pacific Coast Highway. Mr. Knight reported the staff has met with I these agencies to review and consider their input, however agencies such as the Coastal Commission and the Corps of Engineers will not formally consider the project until the local agency has completed its entitlement process. The City Manager-noted that the City Council had been provided with copies of a memorandum from the City Attorney, a memorandum from the Police Department setting forth statistics relating to Part I crimes in the Oakwood, Old Town, and Hill areas covering years 1984 through 1987, and a letter received this date from Mola Development Corporation as a progress report on the wetlands restoration plan. Councilmember Risner noted her previous request of the Police Chief regarding the type of problems that have been experienced in parks within the City, also a request for data as to how many acres of parkland exist in each district in the City, further broken,down into the residential areas of the Hill, COllege Park East, College Park West, and Old Town. The City Attorney referred to a number of reports that have been prepared for the information of the City Council in recent months dealing with various issues involving the Mola development proposal, the procedural processing of the plan, I and the Gion/Dietz decisions of the California Supreme Court as well as recent statutes that deal with issues raised in those cases. He referred to the memorandum provided the Council this date dealing with the question of whether or not the property that is contained within the Mola development proposal is entirely within City boundaries due to an exclusion of certain property that was within the Hellman Ranch in 1953. Mr. Stepanicich explained that in 1975 there was an annexation approved by the City Council and the Local Agency Formation Commission in accordance with the legal procedures for annexations that were in effect at that time, which included the acreage that was excluded in 1953. He advised that their conclusion is that the exclusion of property in 1953 was not done as an initiative measure under the Elections Code, that the proceedings were conducted pursuant to the Government Code governing exclusion of territory at that time, the 1975 annexation also conducted in accordance with the Uninhabited Territory Act of 1939, specifically not requiring an election to be held in the case of uninhabited territory as defined by the Act. He added that it is their determination that Election Code Section 4013 does not apply and that the procedures for annexing property in 1975 were proper. Mr. Stepanicich noted that there was a three month statute of limitations that applied to challenge the validity of the annexation in I 1975, also explaining that twice a year the State Legislature adopts a Validating Act which,covers administrative proceedings, with particular regard to change of boundaries, incorporation of cities, etc., and that the first Validating Act of 1976 would have applied to the 1975 annexation, thus curing any procedural irregularities that may have taken place and question at some future time. 11-7-88 I The City Manager noted that pursuant to Agency authorization on September 19th, the real estate consulting firm of Kotin, Regan & Mouchly, Inc. was retained to perform an analysis to basically determine the real estate feasibility of the proposed development as well as that of the Planning Commission recommendation, and to research other alternatives such as if the development were totally single family, a nine hole versus eighteen hole golf course, etc. Mr. Nelson advised that the consultant was present to review his analysis, copies of which had previously been provided to the Council. I Mr. Ehud Mouchly advised the City Council that their firm had not performed a detailed analysis that involved any plan other than the plan which has been presented to the City for consideration, that they had done a financial analysis in terms of order of magnitude of the alternatives should the plan change drastically. He advised they had analyzed six basic alternatives, commencing with the submitted plan as a base case, the key elements addressed relating to the yield, the plan consisting of one hundred thirteen single family detached homes, six hundred sixty condominiums and an eighteen hole golf course, which are the revenue generators of the project. Mr. Mouchly reviewed the other scenarios as: Alternative Two, the Planning Commission recommendation for one hundred thirteen single family homes, six hundred condos, and eighteen hole golf course: Alternative Three, hypothetical two hundred seventy-eight single family homes and eighteen hole golf course: Alternative Four, hypothetical three hundred forty-five single family homes and nine hole golf course: Alternative Five, hypothetical six hundred thirty-five single family homes; and Alternative Six, hypothetical (Ponderosa plan, modified for wetlands) eight hundred fifteen single family attached and detached homes and one hundred condominiums. He again clarified that the numbers presented relate to orders of magnitude, that no specific, indepth analysis was prepared on each alternative as it was felt to be inappropriate given the circumstances in this case. Mr. Mouchly advised that each of the scenarios were analyzed with respect to physical development characteristics and the cost implications of each alternative, that they did not address the marketability of the housing product, the selling price and absorption rate, the product type kept constant between each scenario, with the golf course premiums only included when they were present. He stated that in all cases a consistant method of measuring the residual land value, which takes into account the profits from land development, reduced by all costs, except land costs, further reduced by what is understood to be the -appropriate profit margin to compensate the developer for risk taking, the-resulting number being what the developer would be theoretically willing to pay for a parcel of land. Mr. Mouchly noted the industry standard of fifteen percent of gross sales was applied for the profit margins, and a target of twenty-five percent was used to measure an appropriate rate of investment for a development of this nature. He also explained that in a typical analysis the price that the developer is contractually obligated to pay for the parcel of land would be used, however in this case that number was not used as it is understood that the ultimate price for acquisition is a contractual matter between the developer and the Hellman Ranch and was not available, however a simulation of land costs was used, derived from the average of two appraisals, which the City commissioned and were done during the past year, the average being twenty-two million for the acquisition price, noting however that is not the actual price that may be paid by the developer. In part, Mr. Mouchly summarized the six I 11-7-88 scenarios as follows: Number One, the proposed Mola plan, the project marginally feasible with a residual land value of approximately $20,500,000: Number Two, reduction of condominium units to six hundred, $2,500,000 reduction in residual land value making the project economically unattractive at the estimated market prices adjusted for an estimated nine percent annual appreciation rate, estimating that a five percent average increase in condominium prices above pro-forma assumptions would be required to make the project -economically attractive: Number Three, two hundred I seventy-eight homes, eighteen hole golf course, the hypothetical residual land value is reduced only by $2,200,000 from Number One, but still economically unattractive, and net impact to City/Agency revenues is minimal as compared to original plan: Number Four, three hundred forty-five single family homes, reducing golf course to nine holes appears to create greater profit to developer, would require substantially mo~e land development costs to build homes in high liquefaction areas, total capital investment by developer is twenty percent higher making project more risky, return on investment is only twenty- three percent versus target of twenty-five, and question viability of physical design of a long-nine hole golf course; Number Five, -six hundred thirty-five single family homes, eliminating golf course completely appears to generate substantial profits to developer, residual land value potentially increases about $29,000,000 above Number One, land development costs much higher, resulting -in forty percent increase in required capital investment, concern with market acceptance, belief that lower home prices needed or larger lots required to avoid appearance of overcrowding, estimate home prices reduced from $450,000 to $390,000 to keep level of profitability, number of units could be reduced,to five hundred while maintaining estimated prices, I financially attractive alternative:-and Number Six, prior ponderosa Plan, greatest developer profit, with hypothetical increase in residual land value of $37,000,000. Noting that he had initiated the ~equest for the financial analysis, Councilman Grgas asked that the consultant respond as to whether or not he had discussed this project with Mr. Mouchly or any member of his firm during the course of this assignment. Mr. Mouchly confirmed that Councilman Grgas had not. Mr. Mouchly responded to a number of ,questions posed by the City Council. He confirmed that the Plan proposed is not greatly enriching the developer, that the rate of return versus the risks are considered to be marginal. Councilman Grgas made reference to the alternative of a single family, nine hole-golf course development, asked if there is question that sufficient economic return could be achieved to keep the developer interested and construct a nine hole golf course given the physical constraints of the site and the manner in which the single family dwellings would have to be laid out. Mr. Mouchly confirmed that there are serious considerations with regard to physical design elements of the site, also that the capital investment requirements would change dramatically with that type of alternative, noting that while the profit margin may remain at two or three percent, the capital investment in terms of I total dollars would increase rapidly and that the element of risk must be considered. Councilman Grgas refer~ed to the option of no golf course and construction of single family dwellings only, the site possibly able to sustain six hundred thirty-five dwelling units and provide the developer with a substantially greater return on investment, while raising the residual land value to the property owner, and questioned what is felt would be the minimum number of single family dwellings the project could sustain until it 11-7-88 I is economically unprofitable. Mr. Mouchly replied that it would be to the degree that one would choose to regulate profits, adding that they have quantified that there is a breaking point of about five hundred units from a standpoint of numbers. with regard to the rate of return-versus risk, Mr. Mouchly -stated that there is first the issue of market demand and supply, that during the life of the project it is likely there will be more than one downturn in the economy, that a project such as this requires a very intensive fronting investment, particularly in land development because it is not the type of project that can be phased over a long period of time, the carrying costs having a significant impact on the return, therefore in doing a financial analysis for a project of this nature you want to create an environment with a potential return on investment that justifies the risk being taken. Mr. Mouchly clarified that in preparing the analysis they took costs and increased them at five percent, which is the current consensus of the CPI increase for the next several years, with the revenue increased at nine percent,-while reflecting residential real estate in the most recent past. Mr. Mouchly confirmed that it is customary that a premium is charged for -a lot that has unusual locational attributes, such as view lots, corner lots, and in this case, golf view lots. He added that although they did not get involved in a detailed land development analysis relating to costs, he noted that in considering what is already known about the site it is very likely there may be additional costs associated with this project that are yet unknown that would further reduce the profit of the developer. I Mr. Ernie Glover of POD, Inc. confirmed that there are a number of physical constraints relating to the subject property, the earthquake fault hazard zone running northwest to southeast through the property and lending that 5.2 acres unusable for residential development or any human habitation, the twenty acres of wetlands and 3.6 acre buffer, again where there could be no residential development, nearly one half of the property subject to liquefaction, a constraint basically from an economic standpoint where dwelling units could be built however the foundation design would be expensive and exotic, also the alignment of First Street was considered to be a constraint. By unanimous consent, the Council declared a recess at 8:53 p.m. The Council reconvened at 9:09 p.m. with Mayor Hunt calling the meeting to order. Given the number ,of constraints on this property, which in turn limits the amount-of land available for golf course use, Councilman G~gas asked if it was felt to be questionable to consider a golf course from a developers standpoint with regard to economics and risk, also in developing a nine versus eighteen hole golf course would there be a significant difference in development and maintenance costs. Mr. Glover responded that although he was not a golf course architect, it appears that if there were to be single family only with a golf course, a standard par thirty-six course could be developed on the property, given all of the constraints and by utilizing the land designated for the driving range in the plan proposed, however their conclusion being that it may not be economically feasible for a golf course. Mr. Mouchly stated he could not address the economics of golf courses, however if this is to become a public course and in order to prevent it from becoming a burden on the public, he would personally favor an eighteen hole course over nine holes, and that the investment is incremental, the costs are not. Councilman I 11-7-88 Grgas noted that questions have come up relating to the assumed sales price levels for the single family and condominiums, given the recent increase in appreciation and economic conditions, and even though a marketing study was not conducted, he stated he would presume-that certain resource documents, basically the appraisals, were used to determine the market, and asked if the-numbers used in the analysis were felt to be understated, and if the price of those units were pushed up significantly, would that be a reasonable expectation. Mr. Mouchly responded that there is I a distinct difference between the impression of individuals about what their-property is worth versus the estimates of a developer of a large project, retail different from wholesale, and in matters of financial and business planning one would never assume, even if certain properties in the market place were selling for $600,000, that one could realize that -amount for the new unit, and if that were so the absorption period would be so long it would render a project unprofitable. He reported that both appraisals were used as the basis of their calculations, and that the relevant-sales prices in 1988 dollars were $450,000 for the single family and $127,000 for the condominiums as a reasonable average-approximation of what a developer will have to charge at an average selling pace, noting that does not take into consideration the golf course lot premiums. councilmember Risner noted there were certain combinations of-housing units that she had wanted considered however were not, questioned the inclusion of the previous ponderosa plan, and asked if the consultant had discussed Seal Beach housing costs with local realtors, noting a thirty percent rise in retail costs last year. Mr. Mouchly responded that the information that was used to develop the analysis was contained in the-appraisals, that no additional-research was I conducted, and explained that in any cash flow analysis where there is a change of significant measure, such as a different price applied to the housing, the calculations would show substantially different results. Mrs. Risner stated that rather -than having all single family homes, that there could be a combination of golf course, -single family homes, some zero lot line units such as Bridgeport, and asked that other combinations of housing be evaluated. Mrs. Risner stated she, as well as the developer, may have some concern that the return on investment is reasonable, however if the plan proposed is determined to be marginally profitable then the City should receive more financial data from the developer to insure he can build this plan and withstand the long term impacts of its construction. Councilman Laszlo inquired as to the lot sizes for the single family dwellings as set forth in scenarios three, four and five-of the consultants report, and the square footage of those dwelling units. Mr. Glover responded that the basic assumption for the single family units was the same product and lot size configuration as is currently proposed, explaining their analysis was not based on lot size, but the number of units per acre, the density of the plan proposed being one hundred thirteen units with a net acreage of eighteen or 6.3 units per acre, and six hundred I sixty condominiums on twenty-four acres or approximately twenty-five-units per acre, and in comparison to scenario , three, two hundred seventy-eight units, would be 6.3 units per acre on forty-five acres, or two dwelling units per acre over the entire site acreage. -Mr. Mouchly added that for the purpose of their calculations an average of two thousand eight hundred square feet was used for the single family dwellings. Discussion continued with Mr. Mouchly giving examples of the terms Internal Rate of Return and residual land value, clarifying that the net annual surplus would be the financial impact to the City/Redevelopment Agency. Noting the six scenarios used in the analysis, Mayor Hunt 11-7-88 I inquired if it would be possible to refer back to the raw data for the various types of housing facilities addressed in the analysis, and then project those numbers to create most any kind of village mix and retain some reasonable accuracy in determining what the residual land value would be. Mr. Mouchly responded that mathematically that would be possible, however another issue would be whether it would be a marketable project at that point, noting also that the IRR or profit margin comes -from the return on investment and does not address the residual land value, which is merely a test. Mayor Hunt noted then that if the residual land value did in fact equal the known purchase price of the land, the project could possibly be considered a feasible endeavor. Mr. Mouchly added that land value is always subject to entitlement, zoning having an influence on the value. Councilman Grgas pointed out that what the consultant worked with in his analysis was an appraisal provided to him using comparative sales of similar units in a like setting, the first appraisal reviewed and verified for accuracy by a second appraisal, and asked if the consultant felt the facts of the appraisal were questionable. Mr. Mouchly stated he felt the appraisal was as straight forward as it could possibly be. Mr. Grgas referred to the Mayor's question about the line of continuum with regard to what can or can not be done in terms of adjusting this plan, noting that the report appeared to provide the development extremes and the combinations in between, stating that it is highly unlikely that there is going to be an alternative to provide the developer with a greater return at a risk that is acceptable to him and at a price that is required by Hellman that the Council has not already seen. Mr. Mouchly agreed that that was a fair assessment. Mr. Grgas stated that in analyzing the report he felt there are three alternatives, no development, adoption of the plan proposed with an eighteen hole golf course,-which translates into seventy percent open space, or pursue a single family development-which could possibly necessitate five hundred units to make the project economically viable-given the risk involved. Mr. Mouchly again agreed that was a fair assessment. In response to Council, the City Manager advised there are no further funds remaining to request additional work of the consultant. Mayor Hunt declared the joint/consolidated public hearing open to consider Amendment Number Four to the Redevelopment Plan, amendment of the Hellman Specific Plan, General Plan Amendment la-88, Land Use Element, General Plan Amendment Ib-88, Open Space/Conservation/Recreation Element, Tentative Parcel Map 86-349, Vesting Tentative Tract Map 13198, and Precise Plan 1-88. The City Clerk certified that notice of the joint public hearing between the Redevelopment Agency and the City Council to consider Amendment Number Four to the Redevelopment Plan was advertised for three consecutive weeks, mailed to each property owner in the Redevelopment Project Area and to those taxing agencies applicable to the City of Seal Beach as required by law, in addition said notice mailed to Marina Hill property owners pursuant to a prior Council request, and mailed to individuals that had requested to be noticed, and that the notice of the City Council public hearing to consider amendment of the Hellman Specific Plan and General Plan Land Use and Open Space/Recreation Elements, the Tentative Parcel Map, Vesting Tentative Tract Map, and Precise Plan was advertised and mailed to those property owners within three hundred feet of the proposed development project as required by law. The City Clerk reported that until 5:00 p.m. this date one hundred fifty communications had been received relating to the proposed development, a number of those communications containing the name of more than one individual. I I 11-7-88 Mayor Hunt invited members of the audience wishing to speak to the matter under public hearing to come to the microphone and state their name and address for the record. He suggested that the children present in the audience be allowed to speak first. Nathan Crandat, 210 - llth Street, stated their group wished to read a cartoon, "Calvin and Hobbs Are Speaking For The Kids Of Seal Beach, We All Want Gum Grove Park And The Wetlands To Be Saved." Other identified participants were Feebe Shackeroff, 629 - Seabreeze, and Jessica Knowland, 1140 Driftwood Avenue. I Councilman Laszlo noted the-complexity and length of the reports presented at this meeting and invited the members of the audience that may-not have an opportunity to speak to attend the next meeting to which the public hearing would be continued. By unanimous consent, the City Council declared a recess at 10:02 p.m. The Council-reconvened at 10:16 p.m. with Mayor Hunt calling the meeting to order. The City Manager announced there had been a brief interruption-in the cablecast of this meeting however the rebroadcast on Saturday would be complete. As a point of clarification, he stated that the sales prices of the homes used in the appraisals did not come from Mola Development as he-had previously indicated, that the appraiser had used figures from ,the Seal Beach area, also that the appraisals that were provided Kotin, Regan & Mouchly for use in their analysis were commissioned by the City, not Mola, however paid for by Mola as part of their application fee, that the only information that had been provided by Mola was their estimated development costs on the project. Mr. Frank Mola, President of Mola Development Corporation, I pointed out the lengthy process that has taken place in attempting to reach the best possible solution for development of the Hellman site. He noted that when they came to the City there was an approved plan for the property of one thousand units, and according to the analysis of the financial consultant that could have been a profitable development, however Mola Development felt there was a better and more appropriate use of that land, the project proposed having nearly one hundred acres of open space through the wetlands, golf course and park space. Mr. Mola spoke in support of the plan as proposed, a project that could be built from a financial standpoint as well as one that, would generate pride of the community. Mr. Mola stated the project architect, Mr. Ernie-Vasquez, would be making a slide presentation, -and that he and his staff were available for questions. He requested that they-be allowed to comment at the conclusion of the public hearing. Mr. Mola indicated their awareness of community desires through,various meetings that have taken place, and with regard to additional acreage for recreational purposes, he noted that when they were before the City during the Specific Plan process the land owners were not willing to sell additional property, however since that time and because of the great demand for an additional recreational site, the Hellmans have indicated willingness to sell the additional property I to the City through the use of Quimby fees that would be paid on the project. He described combinations of tennis _ courts, barbeque areas, a baseball ,diamond, and picnic areas that could be accommodated on the additional five to six acres. In response to Council, Mr. Mola acknowledged his feeling that he could have obtained Coastal Commission approval and built the 1980 City approved development plan, while addressing the wetlands issue for that proposal. Also, in reference to the project proposed and the petition 11-7-88 I in support of Gum Grove Park, he stated he felt Mola representatives have met with the local groups that indicated a desire to meet. Mr. Mola noted that since submitting their proposal in 1986, there have been significant changes to the Plan, and while realizing the numerous constraints of the property, major thoroughfares on either side, an existing neighborhood on one end, a flood control channel on the other, he pointed out that there are only so many ,solutions to the problems of the site. He added that Mola Development ,feels they have put together a plan that from a-financial and asthetic standpoint they can live with and the City will be proud of. In response to a question posed regarcding a recent ad in the Leisure World newspaper soliciting support for the project, Mr. Mola stated that a one hundred million dollar project is proposed, that Mola Development has spent one and a half million dollars to date in consulting and local fees, and acknowledged their desire for those persons supporting the project to also make their; feelings known. Councilmember Risner noted the divisiveness resulting from the issues of this project. stating she felt that all interests can come together and decide what is best for the City as well as the developer. She also recalled her request early in the process that the project prcovide a golf course and Gum Grove Park, and stated she felt there had been an assurance by the developer at that time that Gum Grove Park would be rcetained as it exists. Mr. Mola again stated that as developers they feel they have come up with ,a plan that is hoped to be architectually pleasing, with a land plan that works and is within the confines of the environment, while attempting to address the wishes of as many persons and groups as possible. He pointed out that between-the restoration of the Gum Grove, the golf course-and within the actual project there will be over three thousand two hundred trees, noting that in another two yearcs the existing small number of healthy trees in the grove will become diseased and no longer exist. Mr. Mola added that those persons who have worked on this project are all professionals and it would be in no one's best interest to produce anything other than a quality development. Mr. Ernie Vasquez of the architectual firm of McLarend, Vasquez & Partners, stated he wished to make a slide presentation to show what has taken place over the past two and a half years with regard to the prcoposed project. Mr. Vasquez noted that the residential development of the general area is equivalent-to approximately 4.7 units per acre density. He stated that Pacific Coast Highway and Seal Beach Boulevard are the two major windows to the property that they were involved in planning, their concerns being not only how to best utilize the land, but how to use the natural factors on the site, the ,fault zone, the natural drainage pattern that follows the site, the marcshland, and the high liquefaction zone that exists on the majority of the site-acreage. Mr. Vasquez pointed out that the single family units were located in the area having the best quality soil on the site. He noted their desire to provide as much visual openness as could be experienced from the Seal Beach Boulevard corridor as well-as keep as much openness and utilization of the land around the site, thus approximately seventy percent of the land has been kept open, the density-amortized over the total acreage. He pointed out also that the wetlands area had to be increased by about one and a half acres in order to get full tidal action on the property. Mr. Vasquez stated that considerable thought and study was given to the configuration of the buildings on the property, keeping in mind the relationship to and the distance from the existing I I 11-7-88 homes as well as the view corridors. He stated the smallest of the single family lots is thirty-eight by one hundred twenty, constructed on varying levels.to maximize view, including a zero lot line home to provide maximum utilization of sideyards and good distribution in terms of the street composition. Mr. vasquez noted that the entry has been refined to allow for private entrance that aligns with the signalization that exists on Seal Beach Boulevard, inclusion of a recreational facility near the main entrance providing-the sense of open space, provision for guest I parking, and a tot lot added on one of the single family lots. Mr. Vasquez noted the mediterranean architectual theme which is felt to carry through the historical image of Seal Beach, the single family units being long and narrow, allowing good-usable interior space, taking advantage of the court yards and rear yards, also orienting the rooms to take full advantage of the light and view capabilities. with regard to the condominium program, Mr. Vasquez stated it was felt to be important to create their own sense of arrival, their own enclave area off of the primary circulation, which then allows the main east/west linkage without disturbing any of the residential planning areas. He noted that the tennis courts have now been changed and located over a parking area, reducing the planning area by over an acre of land, thus allowing the ,increase of the marsh area and reduction of the condo area. Mr. Vasquez stated the condominium area has been created in a resort type setting, each of the building modules created over a landscape podium, built over a one level parking structure, the substantial amount of open space around the planning area reducing any feeling of massing, and noted that the unit sizes will range from six hundred to one thousand square feet. He also reported the condo structures are to be built with concrete piles to accommodate the high liquefaction soil conditions. He stated that by using the entry off of I the major loop it allows a specific marketing strategy for the condominiums, basically surrounding the golf course while using the waterways to accommodate drainage from Seal Beach Boulevard through the site, and pointed out a strong sense of entry having been created in terms of recreational facilities, units, modeling, and the amenity of placing the tennis courts over the parking area, also carrying through the mediterranean theme on all four sides of the structures. Mr. Vasquez stressed the importance of various recreation facilities to the condominium program, catering to different types of life styles and desires. He pointed out that the view from the single family homes was felt to be critical, therefore in,their attempt to create a villagelike quality an architectual palette is proposed for the condominium units, no flat roofs or roof mounted mechanical equipment.' He also noted the importance of treating the area of the parking structures and pedestrian access in an asthetically pleasing manner, the triangular courtyard area allowing a walkway along the perimeter of the structure with stairway and elevator access in the center. Mr. Vasquez explained that the clubhouse is proposed as originally envisioned, providing meeting facilities, a pro shop, and facilities for eating. He noted that the driving range has undergone some major modification in terms of its location, which is in I response to concerns of some of the homeowners, and now provides somewhat more length to the range and distance from the existing homes. Mr. Vasquez reported that the golf course architect, Mr. Ted Robinson, has attempted to create a challenging, quality design of three thousand three hundred yards and thirteen water elements. Mr. Vasquez stated that of critical concern was expanding Gum Grove and providing access from Seal Beach Boulevard, noting that the Grove is proposed to be expanded by four residential lots in 11-7-88 I the area of Avalon and of no less than twenty-five feet in width, basically routed and designed along the tree line, enhancing and trying to save the trees of Gum Grove as best as possible, and retain the rural atmosphere of the Park. He pointed out also the provision for hiking trails, observation, seating, and barbeque areas, enhanced from what presently exists, and added that the adjacent residences will have the option of a wall constructed of plaster with color or wrought iron. Mr. Vasquez referred to the potential option for an additional five acres for recreation use which could be designed for two softball diamonds, a tot lot area, and accommodation for thirty to thirty-five cars, a second scenario would be one baseball diamond, four tennis courts, a tot lot, and similar parking area, thirdly, five tennis courts, a linear -parking scheme, tot lot, and a softball diamond, and confirmed that there would be bleachers to accommodate any ball diamonds. In response to Council, Mr. Mola-noted that the courtyard areas in-the condominium complex would be large and landscaped, well maintained, therefore-they would not be areas that you would want to have persons walking through. Councilman Grgas suggested that any questions of the developer or the architect -be reserved-for the next meeting, and that the public be allowed to-speak at this time. He also noted that Mr. Gaylen Ambrose had indicated that he would hold his presentation over until the next meeting. Mr. Hunt invited members of the audience wishing to speak to this matter to come to the microphone and state their name and address for the record. Mr. Anton Dahlman, 1724 Crestview Avenue, asked that his-remarks be made part of the record and his written comments available to the Council. He stated he had ,sorted out what the different interested groups in the community want and that he felt it would be false if determined those needs can not be met. He reported the Tennis Club and the baseball group have indicated no opinion regarding the development, and he stated if the project is approved they will most likely be competing for their desires, while the Wetlands and Save Gum Grove Park groups, and many others all oppose the development, there are needs of those groups that he believed could be met. Mr. Dahlman stated the Leisure World community tends to support the plan, looking to a new source of tax revenue and a golf course, however expressed his feeling that it is unfortunate that Mr. Mola has had the opportunity to reach the Leisure World community where the opponents of the plan have not, where if Leisure World had the opportunity to consider an alternative with an improved golf course, they may support it. He noted that the letters that have come to the City are in response to-a campaign generated by the current plan supporters, stating if the opponents had requested such communications there would have been ten times the number, again noting the number of signatures in support of-the Park and the funds raised by that group to date. He also stated that the notion that the Hellman's are not motivated sellers is suspect,and should be addressed. Mr. Dahlman suggested that an outside agency, preferably the State or possibly a private interest, acquire the acreage of Gum Grove Park and the wetlands separately from Hellman, that Proposition,70 funds -could be obtained, or nature organizations could acquire the land, County and State park funds are available to restore the Gum Grove, the net effect being that Mola Development would save the money to acquire the land as well as the restoration thereof, that money then ~vailable to ret~in the ~ur(eni econo~ic.feasib~litv and 1mprove the qua11ty of the dwe 11ngs oy 1ncreas1ng square footage and decreasing the number of units, a larger and I I 11-7-88 more challenging golf course also possible, resulting in faster appreciation of the dwellings, and a long range better tax base for the City. Mr. Dahlman stated he felt there was support for his proposal-by the Council. Mr. Dan Campbell, 220 Coastline Drive, spoke for much needed recreation facilities in the City, suggesting that the Council consider some compromise in order to accommodate that need with the proposed project. Mrs. Sally Hirsch, Chairman of-the Gum Grove Park Group, stated she had never been asked to meet with the Mola Development. She stated her purpose was to ask the Council to save and maintain the existing Gum Grove Nature Park in its original size and configuration, extended around Avalon to provide a continuous eco system with the wetlands, noting there is no park set forth in the revised Mola plan, nor reference-to a park in the staff acreage breakdown.- She stated that the nature park is an area where people and animals-can coexist, and is used by walkers, joggers, bikers, and hikers, both adult -and -children, and with ,this ,being the only nature park in west Orange County, the Harbors, Beaches -and Parks Commission has also recognized its need. -Mrs. Hirsch reported she had submitted petitions containing over two thousand two hundred signatures in support of saving the full size Gum Grove Park. She added that she felt Mola Development should give this park to the City as well as pay additional fees for the right to create a project that will have substantial adverse impacts on-the community. Mrs. Norma Strohmeier, 209 Seal Beach Boulevard, asked the length of time anticipated to construct the proposed development, suggesting that people should be aware of what will occur with that amount of construction, making reference ~o the time frame for construction of eight units near her residence and what those adjacent residents are being subject to. The staff responded that the phasing for the project will be approximately five years. Mr. Jim Meyers, 601 Beachcomber Drive, asked what impact this project would have on the children attending McGaugh School. Mr. Hunt responded that depending upon the effect on the school population there may-possibly be some revision of the school which the children attend within the Los Alamitos School District. Members of the Council indicated that the school issue is addressed in the EIR, also suggested that contact be made directly with the School District. Mrs. Patti Campbell, 4433 Ironwood Avenue, referred to the classrooms that are adjacent to Seal Beach Boulevard and the noise that is generated from the Boulevard, and suggested that a sound wall of approximately one hundred fifty feet in length be a mitigation requirement of the development to benefit the school and the attending children. Ms. Ethel Rachlin, 1280 Oakmont Road, stated she was sure she was speaking for many Leisure Worlders when she stated there is only a very small percentage of those residents that are concerned with the availability of a public golf course. She expressed support for open-space, parks and green areas to benefit those in the community outside of Leisure World, and requested that due consideration be given to the development plan proposed. Mr. Bob Heenan, 1320 Crestview Avenue, asked that the future of the community not be mortgaged for a short term capital gain, what price is a park or wilderness area, and if it disappears, what will it be replaced with. He requested that the Council make a statement that Gum Grove Park will be retained, and asked what would be the related costs for sewage, education, traffic control, police, fire and medical facilities if -this development-and a ten percent increase in population comes into the community. He also asked what the net annual surplus was for scenarios four, five and six of the consultants analysis, and questioned the feasibility of an eighteen versus nine hole golf course. Mr. Mouchly responded that the net annual surplus for scenario four was calculated to the approximately $1.5 million, number five I I I 11-7-88 I was $2.7 million, and scenario six was $2.9 million, also in reference to the golf course feasibility, he stated he had made reference to operational costs, not capital costs. Mr. Glover clarified that either a nine or eighteen hole golf course could be-built-depending on the configuration of the units on the site, that it should be kept in-mind that the alternatives were defined in a manner that an adequate comparison could-be made, clarifying that a full thirty-six par, nine hole golf course could fit on the site, but to implement the alternatives as they were phrased, the driving range would-have to be deleted. Mr. Heenan concluded his comments stating that it should be kept-in mind that the consequences of this development,will go well into the twenty-first century and the broad perspective of its effect should be taken into consideration. Risner moved, second by Grgas, that the joint/consolidated public hearing be continued to the next regular meeting, November 2lst. AYES: NOES: Grgas, Hunt, Laszlo, Risner, Wilson None Motion carried I It was the consensus of the-Council to excuse the absence of Councilman Grgas from the next meeting. CONSENT CALENDAR - ITEMS "L" THROUGH "Rn Wilson moved, second by Risner, to approve the recommended action for items on the-Consent Calendar as presented. In response-to a question of Councilmember Risner, the City Manager explained that Items "Q" and "R", applications for certificate of public convenience to operate a taxi service, require approval of the City Council and compliance with the applicable provisions set forth in the City's Municipal Code. L. Approved the minutes of the regular meeting of October 3, 1988. M. Approved specifications and authorized the staff to advertise for bids for janitorial services of ' the City Hall, Police Station, City Yard, and Recreation facilities. N. Bids were received for project Number 600, Sidewalk Repair, until October 11, 1988, 11:00 a.m., at which time they were publicly opened by the City Clerk as follows: Bruce Paving Company, Inc. Raymor Electric Company $36,529.00 39,415.00 Awarded the contract for Sidewalk Repair, Project Number 600, to the low bidder, Bruce Paving Company, Inc. in the amount of $36,529.00 and authorized the City Manager to execute the contract on behalf of the City. I O. Approved the specifications and authorized the advertising -for bids for-three Public Works Department vehicles and a rotary mower. P. Approved regular demands numbered 72035 through 72339 in the amount of $691,497.90, payroll demands numbered 32254 through 32435 in the amount of $177,074.49, and payroll demands numbered 32436 through 32593 in the amount of $174,156.52 as 11-7-88 / 11-21-88 approved by the Finance Committee, and authorized warrants to be drawn on the Treasury for same. Q. Authorized the issuance of a certificate of public convenience to Le Bas Limousine subject to the statement of proposed rates and other conditions prescribed by Municipal Code Chapter 23. I R. Authorized the issuance of a certificate of public convenience to West Coast Transportation subject to the statement of proposed rates and other conditions prescribed by Municipal Code Chapter 23. AYES: NOES: Grgas, Hunt, Laszlo, Risner, Wilson None Motion carried CITY COUNCIL ITEMS There were no Council items for discussion. ORAL COMMUNICATIONS There were no communications from the audience. CLOSED SESSION No Closed Session was held. ADJOURNMENT Risner moved, second by Grgas, to adjourn the meeting at 11:42 p.m. AYES: NOES: Grgas, Hunt, Laszlo, Risner, Wilson None Motion carried ,/J I I , , Approve!d: Attest: Seal Beach, California November 21, 1988 The City Council of the City of Seal Beach met in regular seSS10n at 7:00 o'clock p.m. with Mayor Hunt calling the meeting to order with the Salute to the Flag. 1-