RES-8352 First Amendment to Disposition and Development Agreement between Redevelopment Agency and Home Depot USA, Inc.RESOLUTION NO. 8352
A RESOLUTION OF TIlE CITY COUNCIL OF TIlE CITY OF ORANGE
CONSENTING TO TIlE APPROVAL BY TIlE ORANGE
REDEVELOPMENT AGENCY OF A TIlE FIRST AMENDMENT TO
DISPOSmON AND DEVELOPMENT AGREEMENT BETWEEN TIlE
ORANGE REDEVELOPMENT AGENCY AND HOME DEPOT U.S.A.,
INC.
WHEREAS, the Orange Redevelopment Agency (the" Agency") is engaged in activities
necessary to execute and implement the Redevelopment Plan (the "Redevelopment Plan") for the_
Northwest Redevelopment Project (the "Project"); and
WHEREAS, the Agency and Home Depot U.S.A., Inc., a Delaware corporation (the
Developer") entered into a certain Disposition and Development Agreement dated as of
Tllne /4 ,1991 (the "DDA"), which was approved by the Agency by its Resolution
No. ORA-225 as adopted on May 28, 1991 with respect to two certain parcels of property
as more particularly described in Attachment No.2 to the DDA ("Parcel No. I" and "
Parcel No.2");
and WHEREAS, the DDA provides that the Agency is to make certain payments to
the Developer upon the Developer first satisfying certain conditions precedent as set forth in
Sections 203 and 204 of the DDA (the "Conditions Precedent");
and WHEREAS, the Developer.has completed construction of that construction required
on Parcel No..l by the DDA and is operating a full-service Home Depot
store; and WHEREAS, notwithstanding the disposition and development of Parcel No.
2 as contemplated by the parties pursuant to the DDA, the Developer has experienced
difficulty in effecting the development of Parcel No.
2; and WHEREAS, the Agency and the Developer propose to make certain changes to
the DDA as more fully set forth in the First Amendment to Disposition and Development
Agreement (the First Amendment") which includes the Developer seeking (i) to extend its times
for perfonnance with respect to the disposition and development of Parcel No.2 as provided in the DDA; (
ii) to have the Agency delete as a condition precedent to the making of payments by the Agency
to the Developer pursuant to the DDA the development of Parcel No.2; and (iii)
seeks the disbursement of One Hundred Ninety Eight Thousand Six Hundred Sixty-Five
Dollars ($198,665)the "Negotiated Amount") pursuant to Section 3 of the First Amendment.
In exchange, the Developer has proposed that: (i) the rate of interest accruing on amounts payable
by the Agency to the Developer pursuant to the DDA be lowered from ten percent (10%) to
eight percent (8%);ii) an additional condition precedent be added to Sections 203 and 204 of the
DDA that the Developer generate to the Agency or the City of Orange (the "City") as the amount
of sales tax received and retained by the Agency or City in each year the amount of not
less than One Hundred Fifty Thousand Dollars ($150,000), and that if such amount is not.
so received and retained from sales tax by the City or Agency during any year, no interest shall
accrue or be payable in respect to such. year; (iii) the accrual of interest and the lIistributiontotheDeveloperof" Annual Perfonnance Credits" [as defined in the DDA] shall accrue from a
than the date the Agency approves this First Amendment by a vote of its governing board (the
First Amendment Date") rather than the date of the DDA; (iv) the level of revenue-
generation guaranteed to the City by the Developer pursuant to Section 807 of the DDA be increased
from One Hundred Thousand Dollars ($100,000) per year to One Hundred Fifty Thousand
Dollars 150,000) per year; and (v) the maximum value of payments to be made to the
Developer pursuant to Section 201 of the DDA, shall not exceed One Million Four Hundred
Ninety-Five Thousand Six Hundred Thirty-Nine Dollars ($1,495,639) as more particularly
provided in Section 2 of the
First Amendment; and WHEREAS, pursuant to Section 33433 of the
Community Redevelopment Law California Health and Safety Code Section 33000, ~ ~.), the Agency was
authorized, with the majority approval of the City Council after public hearing, to dispose
of property for redevelopment pursuant to the
Redevelopment Plan; and WHEREAS, the Agency, following a duly-noticed public hearing and
with the consent of the City Council, approved the DDA, which provided, in part
for the acquisition and disposition of real property and for the provision of certain assistance
by the Agency; and WHEREAS, the parties to the DDA have determined that certain
provisions of the DDA no longer best serve the mutual interests of the parties and that the interests
of both will be advanced by the approval of that certain document entitled "First
Amendment to Disposition and Development Agreement By and Between the Orange Redevelopment
Agency and Home Depot U.S.A., Inc.", in the form submitted herewith (
the "First Amendment"); and WHEREAS, the activities contemplated by the First
Amendment has been previously.evaluated pursuant to the California Environmental
Quality Act ("CEQA "); and WHEREAS, all actions required by all applicable law with respect
to the proposed First Amendment have been taken in an appropriate
and timely manner; and WHEREAS, the City Council has duly considered all terms
and conditions of the proposed First Amendment and believes that the disposition of the Site pursuant
thereto is in the best interests of the City of Orange and the health, safety, and welfare of
its residents, and in accord with the public purposes and provisions of applicable state
and
local laws and requirements.NOW, THEREFORE, BE IT RESOLVED by the City Council of
the City
of Orange as follows:Section 1. The City Council hereby finds and
determines, based upon substantial evidence provided in the record before it, that the consideration for the
disposition of certain real property pursuant to the First Amendment is not less than the
consideration which the Agency was entitled to
pursuant to the DDA.Section 2. . The City Council hereby finds and determines
that the First Amendment,will promote the elimination of blight within the Project Area by
encouraging the reuse and redevelopment of a portion of the Project Area which was declared
blighted for the reasons PUBL:
described above and the continued operation of a highly-visible commercial use which
stimulates business activity within the Project
Area.Section 3. The City Council consents to and approves the execution by the Agency
of the First
Amendment.Section 5.The City Clerk shall certify to the adoption of this
Resolution.APPROVED AND ADOPTED this 1 ?1-h day of ,
1111y
1994.ATrEST:
GENE BEYER Ma r
Pro
Tern PUSL: 15522_113911 82359.38