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05-14-1996 Council MinutesCITY COUNCIL MINUTES OF A REGULAR MEETING ORANGE, CALIFORNIA May 14,1996 The City Council of the City of Orange, California convened on May 14, 1996 at 4:30 P.M. in a Regular Meeting in the Council Chambers, 300 E. Chapman Avenue, Orange, California. 4:30 P.M. SESSION 1. OPENING 1.1 PLEDGE OF ALLEGIANCE TO THE FLAG Led by Councilman Mark Murphy 1.2 ROLL CALL PRESENT - Murphy, Mayor Coontz, Spurgeon, Slater ABSENT - Barrera NOTE: Mayor pro tern Barrera entered the meeting at 4:45 p.m.1.3 PRESENTATIONS/ ANNOUNCEMENTS/ INTRODUCTIONS Recycler of the Year Award was presented by Nancy Gee, Recycling Analyst, to Russell Higgins of the Orange Public Library. City employees that were nominated for "Recycler of the Year Award" were also recognized. (C2500.M.l.l)1.4 PROCLAMATIONS A proclamation honoring National Public Works Week, May 19-25, 1996, was accepted by Steve Smith, Assistant Water Manager, Department of Public Works.A proclamation honoring Emergency Medical Services Week, May 19-25, 1996, was accepted by Acting Fire Chief Clevenger. A proclamation honoring Municipal Clerk's Week, May 5-11, 1996, was accepted by Cassandra J. Cathcart, City Clerk.2.CONSENT CALENDAR Tape 450 2.1 Declaration of City Clerk, Cassandra J. Cathcart, declaring posting of City Council agenda ofa regular meeting of May 14,1996 at Orange Civic Center, Main Library, Police facility at 1107 North Batavia and the Eisenhower Park Bulletin Board and summarized on Time Warner Communications; all of said locations being in the City of Orange and freely accessible to members of the public at least 72 hours before commencement of said regular meeting.ACTION: Accepted Declaration of Agenda Posting and authorized its retention as a public record in the Office of the City Clerk. CITY COUNCIL MINUTES May 14,1996 2. CONSENT CALENDAR (Continued) 2.2 Request Council confirmation of warrant registers dated April 19, 23 and May 3, 1996. ACTION: Approved. AGREEMENTS 2.3 Request Council approve a License Agreement with Louis and Rosalie Puccio for maintenance of a five foot strip of land adjoining the new Metro Link Parking Lot on the north side of Maple Avenue. (A2100.0 AGR- 2602)FISCAL IMPACT: This area will be landscaped and irrigated as part of the parking lot construction and maintained by the City of Orange. The estimated construction cost is 900 and the estimated annual maintenance cost is approximately $300. Funds are available in both the project budget and the operating budget to fund these costs.ACTION: Authorized Mayor and City Clerk to execute agreement on behalf of the City.2.4 Request Council approve the MetroCities Fire Authority Joint Powers Agreement and appoint the City Manager to the Executive Board and the Acting Fire Chief as the alternate. Agreement to take effect on or about July 1, 1996. (A2100.0 AGR-2603)FISCAL IMP ACT: This consolidation will result in an annual savings of approximately 45,000 for the City of Orange.ACTION: Authorized the Mayor and City Clerk to execute agreement on behalf of the City.2.5 Request Council approve the renewal of No-Cost Health Services Agreement with the County of Orange. ( A2100.0 AGR-0040I)FISCAL IMPACT: Renewing this contract with no out-of-pocket cost to the City has no impact on the budget.ACTION: Authorized Mayor and City Clerk to execute on behalf of the City.BIDS 2.6 Request Council approve the award of Bid No. 956-28, Two Backhoe/Loaders, to Orange Coast Ford Tractor, Inc., Orange, Ca, in the amount of$100,267. (A2100.0 AGR-2604)FISCAL IMPACT: Funds are budgeted in Account No. 720-5023-472102 (Vehicle Replacement Fund).ACTION: Authorized Mayor and City CITY COUNCIL MINUTES May 14,1996 2. CONSENT CALENDAR (Continued) 2.7 Request Council approve plans, specifications and advertisement of Bid No. 956-29 for the installation of a City-owned street light system located at Katella Ave. from Tustin St.to Cambridge St., and Tustin St. from Katella Ave. to 548 feet north of Van Owen Ave.The pending completion of a utility underground district requires replacement of the existing overhead serviced street lights. (54000.S. 3.1O)FISCAL IMPACT: Project cost is estimated at $145,450. Funds are allocated in the Traffic Safety Capital Improvement Project Street Light Conversion Account No. 251-5032- 483100- 6456.ACTION: Approved.CLAIMS 2.8 CLAIMS FOR DAMAGES FROM:a. Nosa Aduwa b. Philip Burchill c. Sandra Lord d. Robert and Sharon Gonzales e. James Turner FISCAL IMPACT: None.ACTION: Denied claims and referred to City Attorney and Adjuster. (C3200.0)CONTRACT 2.9 Request Council renew the life insurance contract through ITT Hartford Life Insurance Company and purchase a new long term disability contract with ITT Hartford Life Insurance Company, replacing the existing long term disability contract with UNUM Life Insurance Company of America, effective May1, 1996. (11200.0.3)FISCAL IMP ACT: The current budget and projected budget for Fiscal Year 1996/97 contains funding for the new LTD policy and renew the life insurance policy with a ITT Hartford. Savings to the City is approximately $9,175.ACTION: Authorized Mayor and City Clerk to execute agreement on behalf of the City.GIFT ACCEPTANCE 2.10 Request Council authorize receipt ofa $1,000 gift from the Orange Community Historical Society and allocate $1,000 to Fund 100-2011- 443101-9980 to purchase materials for the CITY COUNCIL MINUTES May 14,1996 2. CONSENT CALENDAR (Continued) FISCAL IMPACT: This gift award of$I,OOO will supplement the Library's Local History Budget. No matching funds from the City are required. ACTION: Approved. GRANTS 2.11 Request Council accept a $4,856.95 grant from the Service Authority for Abandoned Vehicles and designate the funds for the purchase of computer and radio equipment for the Police Department's abandoned vehicle unit. (C2500.K) FISCAL IMPACT: None, the purchases will not exceed the grant funding. ACTION: Approved. MINUTES 2.12 Approve the following City Council Minutes: Regular Meeting, April 23, 1996, Adjourned Regular Meetings, April 24, 1996 and April 30, 1996. (C2500.0) ACTION: Approved. PARKING PERMITS 2.13 Request Council approve issuance of "no fee" parking permits for the Assistance League of Orange (10), and First United Methodist Church (2) and review this fee waiver annually. (S4000.S.3.1.2) FISCAL IMPACT: Loss of$I,440-annual parking permit fees.ACTION: Approved.2.14 Request from Chapman University to close Walnut Avenue between Orange and Center Streets from 9:00 - 11:00 a.m. and from 3:00 - 5:30 p.m. on Sunday, May 26, 1996 and waive parking restrictions on Saturday, May 25 and Sunday, May 26, 1996 for their annual Baccalaureate and Commencement exercises. (S4000.S.3.1.2)FISCAL IMPACT: None.ACTION: Approved.PAYMENT AUTHORIZATION 2. 15 Request Council approve payment authorization to International Service Systems (lSS)Energy services in the amount of $31 ,000 for estimated and identified costs for heating/air conditioning maintenance services for the remainder of Fiscal Year 1995/96. (C2500J.3)PAGE 4 CITY COUNCIL MINUTES May 14,1996 2. CONSENT CALENDAR (Continued) FISCAL IMPACT: Funds are budgeted in Account No. 100-7028- 424201 (Maintenance Contract) $18,575 and 100-7028-424101 (Repair to Buildings) $ 12,425.ACTION: Approved. PUBLIC CONVENIENCE AND NECESSITY 2.16 The Planning Commission recommends the City Council make the finding that public convenience and necessity will be served by upgrading the Alcoholic Beverage Control license at the Circle K Mini-Market (located at 2650 N. Santiago Boulevard) from a Type 20" Off-Sale Beer and Wine to Type " 21" Off-Sale General. (p1300. 0. 2)FISCAL IMPACT: None.ACTION: Approved.RECYCLING 2.17 Request Council receive and file a report on the six month review of Call-In Residential Used Oil Pickup Recycling Program. (C2500.M.l.l)FISCAL IMPACT: All costs are paid from grant funds in the amount of $200,000, budgeted in Account No. 220-5022-427100-0000- 00150 (State Grant Funds).ACTION: Received and filed.REQUEST FOR CHANGE ORDER 2.18 Request Council approve funding of Change Order Number Two in the amount of 28,580 for Sycamore Park ConcessionlRestroom Facility Project. This change will allow for a permanent shade structure and finalize ADA requirements. (A2100. 0 AGR- 2526)FISCAL IMP ACT: Funds are budgeted in Account: 510-7021-485100-0525 (portola)28,580.ACTION: Approved.2. 19 Request Council approve funding of Change Order No. Two for Santa Fe Depot in the amount of $ 16,291.75. This change will allow for additional renovations including permanent sod. (A2100.0 AGR-2533)FISCAL IMP ACT: Funds are budgeted in the following accounts: 510-7021-485100-0971 (Santa Fe Depot) $ CITY COUNCIL MINUTES May 14,1996 2. CONSENT CALENDAR (Continued) Discussion: Carole Walters, 534 N. Shaffer, reported that the planter bed at the Santa Fe Depot Park is being lined for a fountain; asked when it was going to become a fountain; and indicated the Old Towne Steering Committee voted against a fountain at the park. The Director of Community Services responded the construction lines for the fountain provide the ability to put a fountain at the location in the future. Mayor Coontz commented community groups are interested in donating funds towards the enhancement of the park, which could include a fountain. ACTION: Approved. REQUEST FOR PROPOSAL 2.20 Request Council authorize staff to initiate a Request for Proposal process to identifY a firm to conduct a City-wide Position Classification Study. (C2500.J. 4)FISCAL IMPACT: Impact to the Fiscal Year 1995/96 budget is approximately $30, 000 100-1401-426700 Other Professional and Consulting Services). ACTION: Approved.RESOLUTIONS 2.21 RESOLUTION NO. 8600 A Resolution of the City Council of the City of Orange expressingappreciationtoCaptainDeanRichardsandcommendinghimformorethanthirtyyearsofdedicated service to the City of Orange. (C2500. K)ACTION: Approved.2.22 RESOLUTION NO. 8606 A Resolution of the City Council of the City of Orange expressing appreciation to John B.Aguiar of the Orange Fire Department and commending him forthirty-two years ofIoyal and dedicated service to the City of Orange. ( C2500.H)ACTION: Approved.2. 23 RESOLUTION NO. 8617 A Resolution of the City Council of the City of OrangeapprovingLotLineAdjustmentLL96-1 adjusting a lot line of certain real property situated at Lots 4 and 5 of Tract No.2877 in the City of Orange, County of Orange, State of California as per map recorded in Book 115, Page 36 of miscellaneous maps in the Office of the County Recorder of said County. ( C2500.M. CITY COUNCIL MINUTES May 14,1996 2. CONSENT CALENDAR (Continued) Owner: Citrus VilIage Partners, L.P. Location: Northwest corner of Citrus and Walnut ACTION: Approved. 2.24 RESOLUTION NO. 8619 A Resolution of the City Council of the City of Orange supporting the Katella Avenue Smart Street Implementation Plan. All Cities in the smart street corridor must approve the implementation plan by June 30, 1996 to qualifY for Measure M funding to construct recommended improvements.S4000.S.2) FISCAL IMPACT: OCTA has identified $80 million for future Smart Street improvements. No City funds have been allocated for these improvements. ACTION: Approved. 2.25 RESOLUTION NO. 8626 A Resolution of the City Council of the City of Orange approving an application for 1996-97 Grant Funds from the Urban Forestry Grant Program under the California Wildlife, Coastal and Park Land Conservation Bond Act of 1988. (C2500.M.15) FISCAL IMP ACT: All costs for the tree planting program will be paid from the $30,000 grant on a reimbursable basis. Discussion: Barbara DeNiro, 1118 E. Adams, inquired where the City will plant new trees; who pays for the tree maintenance; and asked if tree activists have trees in their parkway? The Director of Public Works responded the grant pays the cost of trees only if approvedbytheState. Trees would be placed where there are none at the present time. Specificlocationswoulddependonhowmanytreescanbepurchasedwithgrantfunds, and if adjacent owners provide the care required to plant them in residential areas. ACTION: Approved. PAGE 7 CITY COUNCIL MINUTES May 14,1996 2. CONSENT CALENDAR (Continued) 2.26 RESOLUTION NO. 8627 A Resolution of the City Council of the City of Orange denying the appeal of approval of Major Site Plan Review No. 6-96 and approving said Major Site Plan Review for property located west of The City Drive and north of Metropolitan Avenue. (A4000.0 APP-431)Major Site Plan Review No. 6-96 The Mills Corporation ACTION: Approved. STREET NAME CHANGE 2.27 Request Council assign responsibility for recommending street name changes to the City Traffic Commission. ( ORI800.0.19) FISCAL IMPACT: None. ACTION: Approved.WAIVER 2.28 Request Council consent to a waiver under the State Bar of California Rules of Professional Conduct for the representation of the City and Redevelopment Agency by the law firm of Arter and Hadden. (C2500.B) FISCAL IMPACT: None.ACTION: Authorized the City Manager to execute a letter consenting to the waiver. MOTION - Barrera SECOND - Spurgeon AYES - Murphy, Barrera, Mayor Coontz, Spurgeon, Slater All items on the Consent Calendar were approved as recommended. END OF CONSENT CALENDAR 3. REPORTS FROM MAYOR COONTZ - None PAGES CITY COUNCIL MINUTES May 14,1996 4.REPORTS FROM COUNCILMEMBERS Tape 646 4.1 Request from Mayor pro tem Barrera to leave the State May 17 through 22, 1996. Mayor pro tern Barrera reported he is planning to attend his grandson's graduation from Boston College. (C2500.0) MOTION SECOND AYES Spurgeon Murphy Murphy, Barrera, Mayor Coontz, Spurgeon, Slater Moved to approve.NON-AGENDA ITEM 4. 2 Request from Councilmember Spurgeon on status of term limitations.Councilman Spurgeon requested a status report from the City Attorney relative to a Resolution establishing term limitations for Council's consideration to be placed on the November, 1996 ballot. The City Attorney responded the Resolution is being prepared and will be coordinated with the Resolutions prepared by the City Clerk's office calling for the November election, which are scheduled for a June meeting.5. REPORTS FROM BOARDS, COMMITTEES, AND COMMISSIONS 5. 1 Accept resignation submitted by Erika Wolfe from the Design Review Board. Direct the City Clerk to begin Maddy Act requirements. (ORI800.0.8.1) Tape 714 Mayor Coontz directed a letter of appreciation be sent to Erika Wolfe.MOTION SECOND AYES Coontz Barrera Murphy, Barrera, Mayor Coontz, Spurgeon, Slater Moved to accept the resignation with regrets, and instructed the City Clerk to begin Maddy Act requirements.5.2 Appointments to the Planning Commission, Community Video Advisory Board and the Orange Public Library Board of Trustees.Mayor Coontz indicated she recently became aware of a vacancy to a delegated position to the Orange Unified School District on the Community Video Advisory Board, which is in addition to a current Council appointed vacancy. She requested continuation of the appointments to the May 28, 1996 meeting. (C2500. G.2.5.1 C2500.I.1)PAGEl CITY COUNCIL MINUTES May 14,1996 5. REPORTS FROM BOARDS, COMMITTEES, AND COMMISSIONS (Continued) Mayor Coontz stated that notification letters will be sent to Planning Commission applicants. MOTION SECOND AYES Coontz Slater Murphy, Barrera, Mayor Coontz, Spurgeon, Slater Moved to appoint Toni Carlton to the position of Planning Commissioner to fill the vacancy created by Bill Cathcart.MOTION SECOND AYES Coontz Spurgeon Murphy, Barrera, Mayor Coontz, Spurgeon, Slater Moved to appoint William Warne to the position of Orange Public Library Board of Trustees to fill the vacancy created by Chuck Hukari.6.ADMINISTRATIVE REPORTS Tape 807 6. 1 Appeal by Beatrice Leslie Kight-Herbst of the Traffic Commission ruling denying the installation of an 'All-Way' STOP control at the intersection of Walnut Ave. at Lincoln St.Beatrice Leslie Kight-Herbst, 1435 E. Walnut Avenue, reported on two traffic accidents at Walnut Avenue and Lincoln Street on March 9, 1996. In nine years there have been an average of three accidents a year, not including domestic animals that are hit or accidents where cars run into the curb. She indicated that cars travel at excessive speeds on Walnut Avenue and that tickets written by the Police Department generate revenue for the City. Ms. Kight-Herbst expressed disgust with the way the Traffic Division and Traffic Commission do business.The Director of Public Works explained that the Traffic Engineering staff does an analysis,prepares a report, and makes recommendations to the Traffic Commission based upon the standards of the profession, and legal limitations that involve the regulation of traffic on public streets. The guidelines for installation in 'All-Way' stops are set forth in the State Traffic Manual,which are followed under provisions of the Vehicle Code, which is part of the National Manual Uniform Traffic Control devices. States are required to develop traffic manuals based upon the national publication.The criteria looked at are the volumes of traffic on the two streets, the delay to cross street traffic,and the accident history. At this location, the traffic volumes do not meet the criteria for four-way stop control. There are approximately 8,000 cars a day on Walnut, and approximately 2,000 cars a day on Lincoln. During a.m. peek periods, there is approximately 600 cars a day on Walnut and 175 on Lincoln; and during p.m. peek periods, approximately 750 on Walnut and 140 on Lincoln. The Chief of Police said he didn't believe there is a speed problem at the intersection. He indicated the speed was changed to 35 mph to enable enforcement of the 35 mph speed. If the PAGE 10 CITY COUNCIL MINUTES May 14,1996 6. ADMINISTRATIVE REPORTS (Continued) speed was left posted at 25 mph, speed laws could not be enforced. Approximately two years ago the City stopped receiving revenue from moving violations, and the revenue was never intended as a way to make money. Citations are only utilized to ensure public safety. Mayor Coontz referred Ms. Kight-Herbst to the City Traffic Engineer and the Director of Public Works to discuss her concerns. MOTION SECOND AYES Barrera Murphy Murphy, Barrera, Mayor Coontz, Spurgeon, Slater Moved to continue this item to June 11, 1996.6. 2 Request from The Mills Corporation for a variance to build its project at elevations lower than the Base Flood Elevation as determined on the Federal Flood Insurance rate map. This request is based on recent completion of flood control improvements along the Santa Ana River and expected completion of additional upstream improvements within three years. (V1300.0)The Director of Public Works referred to new flood insurance rate maps, which reflect the Federal Emergency Management Agency is in the process of approving a special zone in the area which will remove the flood hazard. With the improvements to the levees on the Santa Ana River and the construction that is taking place with the Seven Oaks Darn, which will be completed in 1999,the area will be entirely removed from the flood hazard designation. At present, there is no base flood elevation. The Mills Project and all residents within the area will benefit because the cost of flood insurance will be reduced. With the completion of the darn, there will no longer be a mandatory flood insurance requirement within the area affected by the flood plain.Mayor Coontz recognized Barbara DeNiro who commented that there will be a 100 year flood one day, and why would we allow this?The Director of Public Works responded that the 100 year flood is the basis for the design of the facilities, and it is the protection against the 100 year flood that is the standard for determining whether or not special precautions are needed. With the improvements, there is sufficient protection. MOTION SECOND AYES Murphy Slater Murphy, Barrera, Mayor Coontz, Spurgeon, Slater Moved to approve the variance request.PAGE 11 CITY COUNCIL MINUTES May 14,1996 6. ADMINISTRATIVE REPORTS (Continued) 6.3 Request Council approve letter agreement with Time Warner CablelCablevision of Orange to purchase and install equipment for televising City Council meetings per terms and conditions as stated in the agreement. (C2500.N) The Community Services Manager gave an overview of the report and stated that City Council previously authorized the Letter Agreement with Time Warner/Cablevision of Orange to set aside 100,000 for the purchase and installation of television equipment, which would be part of the cable franchise agreement. There would be no impact to the taxpayers or the revenue received from the franchise fees, and no increase in subscriber rates. The recommendation is to purchase and install three remote cameras in the Council Chambers and to purchase the necessary equipment. The cameras would be handled, controlled, and produced remotely by a two-person operation. He referred to Exhibit A which would cost approximately 98,000 and provide better quality equipment, as well as the capability to expand in the future. It was determined from a taping of the Council meeting several weeks ago that the current sound equipment is sufficient for live television. The light bulbs overhead in the Chambers would be replaced with higher wattage and should not increase the temperature. Based upon Council' s approval, the system should be up and running sometime in July.Chris Leist, Programming Coordinator for Time Warner Communications, 303 West Palm,reported that there are 26,000 subscribers in the City of Orange. They are currently going through a channel realignment, therefore, in July the Council meetings would be televised on Channel 19, and after that time would be on Channel 3. They will return to Council within 60 days relative to thoughts and recommendations on the production side. Cablevision of Orange would handle the televising from the time the system is up and running through December, 1996.The City would then decide who will handle the cable casting.Councilman Murphy stated that he supports the concept, having raised the issues in the first place,along with a couple of others, asking that prior to the issuance, the differences in the Exhibits be double-checked, because he could not quite add up to the bottom line numbers. He suspects some of it has to do with the additional audio equipment and some of the other things that are involved. A final summary back would be important to see the final procurement.Mayor Coontz expressed concern about one professional and one learner; indicating that she had attended a cable program preview, and only one person showed up with the cameras. She feels this issue needs to be discussed. MOTION SECOND AYES Murphy Spurgeon Murphy, Barrera, Mayor Coontz, Spurgeon, Slater Moved to approve subject to return of final procurement. PAGE 12 CITY COUNCIL MINUTES May 14,1996 6. ADMINISTRATIVE REPORTS (Continued) 6.4 Report from the City Attorney on the Orange County Bankruptcy - Stipulation regarding treatment of specified City claims.The Assistant City Attorney reported on a stipulation which was negotiated between the County of Orange and the City subcommittee, which provides that none of the City claims will be treated as Category B-27. Those were claims that would be paid out at 52.4 cents on the dollar under the County's plan of adjustment. The stipulation guarantees all City claims will receive more favorable treatment under the plan. The court approved the stipulation a few days ago, and the request is for the City Council to authorize the Mayor to execute the stipulation. MOTION SECOND AYES Spurgeon Murphy Murphy, Barrera, Mayor Coontz, Spurgeon, Slater Moved to authorize the Mayor to execute the stipulation.6.5 Approval of HOME Agreement with Orange Garden Apartments LLC to provide funding in the amount of $769,250 (HOME Funds) for the acquisition and rehabilitation of the apartment buildings located at 1931, 1941 and 2003 Quincy Street.The City Manager presented an overview of the project, reporting that on March 26, 1996, the City CounciI/ Redevelopment Agencyapproved the agreements based upon the principals who were involved, and gave direction to sign documents of non-substantive changes. The HOME and Set-Aside unit money totaling $1.9 million has not changed. This would purchase 80 affordable units for the City of Orange. The investment cost on the 24 HOME units is approximately $32,000 per unit, and the investment cost for the 56 units is approximately 21,700. There is a change in the principals and he felt the issue needed to be brought back to CounciVAgency. He reported that Mr. Crume, Mr. Cottle, and Mr. Sciuto are no longer partners on the proposed limited liability corporations, only two of them are, and there are two new partners. Various issues involved Agency approval for transfer of title; indemnification on the 80 units; and the principals in the limited liability corporations which involves the HOME units and Set- Aside units. He reported the attorney is comfortable that the principals are offering indemnification from relocation costs that may result from any displaced persons from the 24 HOME units and the 56 affordable units. There is cash equivalent security set aside in the amount of $250,000 to provide additional security, should displaced persons result from actions of the developer and result in relocation costs. The proposal to rehabilitate the units and on-site relocation have not changed. The relocation consultant also has assured staff and the developer that the possibility of having displaced persons, and having relocation fees paid for people who would have to be relocated off-site, would be minimized, if the developer follows through with the proposal and plan of intent to rehabilitate units, and offers them to residents who live on site. He added there are a substantial number of vacant units on the property and reiterated that indemnification is provided only for the 80 CITY COUNCIL MINUTES May 14,1996 6. ADMINISTRATIVE REPORTS (Continued) Mayor Coontz recognized Barbara DeNiro's speaker card which indicated this report was not available for review. Barbara DeNiro was provided with a copy of the report. Barry Cottle, P. O. Box 311, Tustin, developer for the proposed project, reported they have an excellent handle on the project. He referred to his new partners on the project, Mark Conzelman and Bill SommerviIIe, a family-owned operation that have built and developed 4,200 apartments over the last 35 years, which they still own today. The new partners don't sell their property, and share the same goals and ideas relative to long- term ownership.Mr. Cottle explained they will stand behind the indemnification, the protection for the City, and the agreement. The three lots will be consolidated into one lot for the 24 unit HOME project and the Housing Set-Aside monies.Paul Dunlap, 931 N. Highland, stated he owns the 38 unit Orange Meadows Apartments across from the proposed project, and 30 units one block north of the property on Wilson. He expressed concern with the initial presentation on Parklane Gardens, stating it did not appear there was sufficient evidence of commitment on behalf of the developer to add community amenities to substantially change the character of the property.In addition, Mr. Dunlap said there are 32 individual parcels on the proposed project, and Great Western Bank could sell them out, one by one, to 32 different owners, making the task of managing, policing and assuring the upkeep of the units difficult. With the total funding of $2 million between the Council and Redevelopment proposals, 80 units are involved. Since this project is 256 units, 176 units (22 other buildings) are not being addressed.The City Manager reported that in February, 1996, the original proposal by Southern California Investments was for $1.9 million, which includes the HOME units and Housing Set-Aside units.The proposal was to provide 77 affordable units to the City. Southern California Investments made the determination they could not afford the potential rehabilitation or relocation costs that may result by acquiring 256 units at that site.In March, 1996, the proposal by Cottle, Crume and Sciuto was for 80 units of affordability for the same amount of money that 77 units were going to be purchased for in February. The 176 units were not a part of the March proposal. Correspondence has since been received from Mr. Cottle relative to the change in partners and indemnification, and the proposals as individuals was withdrawn on the 80 units. The new partners agreed to the same terms and conditions Council approved in March for the 80 affordable units. The funding for the project is to help the developer acquire and rehabilitate the property.Councilman Slater indicated it was his understanding in March, and the reason he voted for the project was because there was a commitment that something would be done with the other 176 units, in terms of CC&R's and lot consolidations. He reiterated that Council was told there would be some guarantee that something would be done with the 176 units, in the process of approving the other 80. He asked the City Manager that since the document was not in final form and never had been every time it came to them, always very last minute, would they have a chance to review it before it is approved, and when? The City Manager responded that the agreement had CITY COUNCIL MINUTES May 14,1996 6. ADMINISTRATIVE REPORTS (Continued) received that afternoon because oflast minute changes. He said the agreement could come back to allow an opportunity for review, otherwise, with the Council's approval, it would be executed. He asked if the City's liability exposure is increased or lessened since the investors are now proposing to purchase with a limited liability company. Since the buyer is involved with the 176 units, from a legal perspective, he added there must be a legal tie in terms of relocation expenses that could potentially affect the other 176 units. Additionally, he asked the City Manager if he felt 100% sure that the City would be indemnified against any relocation costs for the entire 250 units. The City Manager responded the purchase as individuals or as a limited liability corporation does not have an impact on exposure. Exposure was to the issue of relocation dollars, and the additional security of the Letter of Credit or Certificate of Deposit or other cash equivalents set aside, so that if relocation dollars were impacted, there would be a security beyond the assets of the limited liability corporation. Additionally, he said he could not give the endorsement that the City would be indemnified against relocations costs for the entire 250 units, nor make a legal opinion. He could only tell what legal counsel has indicated to him, that there is always a potential for some liability in the event of relocation. Councilman Slater said when the project first came to the Council, he was excited and felt this was a chance to remove 256 units from blight in the City. Now 80 units is all the City is getting from the $1.9 million, or $1.2 from the Agency's investment, which unfortunately are located at the north end of the project. The City would have no control over the 176 units to the south and several units to the north, and indicated he has trouble seeing how investing in 80 units will make much of a difference, as this would only give them control over 1/3 of the entire area. He expressed his confidence in Barry Cottle and Ken Crume's ability, but unfortunately they would only control 40% of the project. This is a 100% grant, and there is no return to the City for the investments, should the owners need to sell the property in a couple of years. He also expressed concern that the City isn't getting enough guarantees; concessions have continuaIly been made on the project; and he has seen nothing in return. Again, he asked the City Manager if he felt that he, staff, and the outside legal counsel, could make a strong recommendation for approval of the project. The City Manager responded that based on the cost of the units that the City has put forth in dollars in the past, and the comfort level that he has with which the City has for protection against indemnification on the 80 units, and the protection of the additional cash security, or cash equivalent security, he does feel comfortable, in bringing the issues to resolution. It is a matter of interpretation of whether the Council wants to invest in the location or not. Councilmember Slater added it was unfortunate that he did not have ample time to review the document. He said this was an opportunity to improve 256 units, rather than 80 units. The bank is selling it as one chunk, and anyone that buys it will come to the City for help. They will not be sold off individually, because it is all one project. He feels the City/Agency is abandoning the drivers seat to make an exception and improve only 80 units. PAGE 16 CITY COUNCIL MINUTES May 14,1996 6. ADMINISTRATIVE REPORTS (Continued) The City Manager responded there was discussion regarding the 176 units and the developer offered to have CC&R's for controllability ofthe units and occupancy. From a legal standpoint, the City does not have control over the 176 units, indicating the developer may want to address the Council relative to the 176 units. He explained that under the last proposal, there was discussion of consideration ofIot line adjustments, and legal counsel advised him there was not sufficient consideration to tie them together. The Police Chief reported that blight contributes significantly to crime, and at one time, the apartments accounted for approximately 40% of all the crime in the City of Orange. The area in question does receive a lot of service from the Police Department. If the project being offered can reduce blight and bring in proper management, it would cut crime and free up resources that could be used in other areas of the City. Barry Cottle said this project is not a grant, but a forgivable loan. Certain conditions must be met for it to stay a forgivable loan, and the conditions run for 55 years. It is recorded against the property, if the units are not kept affordable, rehabilitated, or managed, then it becomes a loan, which is spelled out in the interest rate and payment terms, etc. The 176 apartments next door are still being purchased, and funds are not being requested from the Agency or the City. The entity buying the apartments are going to rehabilitate them and do a lot consolidation. On both affordable housing agreements, there is lot consolidation and it is only subject to the public streets that divide it. The occupancy is private owners on the 176 apartments. Mr. Cottle apologized for the time pressure with the bank, stating the bank has indicated that if they fail in obtaining the City or Agency monies, it will be sold to someone else. Mr. Cottle said the bank has indicated they would not give someone else time to come back to the City. He further reported that the private funding and private financing, as well as the $250,000 Certificate of Deposit are in the bank. The relocation is his responsibility and there would be no relocation cost to the City. The City's relocation consultant, Del Richards and Associates has assured them relocation costs would be minimal, if any. Carole Walters, 534 N. Shaffer, stated she feels the project should be put off until the next meeting, allowing residents the right to review the project. She feels the Council! Agency should not vote on the project tonight just because the bank has a deadline. Mayor Coontz confirmed from Mr. Cottle that if the City/Agency does not vote soon on the project, the bank wilI put the project on the market again. She asked Mr. Dunlap ifhe had bid on the proj ect. Mr. Dunlap responded that he had not bid on the project. Kevin Teal, 12850 Crawford Drive, Tustin, representing Great Western Bank in the sale of the property, reported that Great Western is crediting back $700,000 to rehabilitate the property. The developer has divided the property into three different sections for various reasons. There PAGE 16 CITY COUNCIL MINUTES May 14,1996 6. ADMINISTRATIVE REPORTS (Continued) would be a $6 million note on the property, and they would make sure that the property, after the money is spent, secures the loan. Mr. Teal also indicated that Paul Dunlap is interested in acquiring the property. He said Great Western is at the point that they will pull the deal from Barry Cottle and Ken Crume. If the property is not closed within a week, the deal is over; backup offers are being taken on the property and are being countered. RESOLUTION NO. 8620 A Resolution of the City Council of the City of Orange approving a HOME Agreement with Orange Garden Apartments LLC, a California Limited Liability Company and making certain findings. MOTION SECOND AYES Murphy Coontz Murphy, Barrera, Mayor Coontz, Spurgeon, Slater Moved to continue the item to the 7:00 p.m. meeting to give the Council more opportunity to review the agreement.7.REPORTS FROM CITY MANAGER Tape 3667 7.1 Report on the Management Information System Computer Phased Implementation Plan relative to existing and proposed budget. (Continued from April 23, 1996.)C2500.J. 2)NOTE: Councilmember Murphy excused himself from this item and left the Council Chambers.The Special Project Manager presented an overview of Phase I and Phase II of the Information Management Plan. Phase I would replace the personal computers at City employee workstations,the printers, and upgrade the software. The network servers need to be upgraded. BRC, the City's service provider, will provide additional staff at no cost for the first part of Phase I, which is through July 12th. Phase I will begin the stages for a local area network. A Request for Proposals will be prepared for the second half of Phase I for needed technical support.Phase II will provide for a wide-area network, which would include the CD ROM towers, the GIS system, laser printing; new building permit software, and the imaging system for the City Clerk's office. Phase II will be considered in the current budget discussions. Departments have contributed over $300,000 to make this proposal happen. It was recommended Council approve Phase I at a cost of $620,368.00, which includes the $250,000.00 beginning of the local area network. PAGE 17 CITY COUNCIL MINUTES May 14,1996 7. REPORTS FROM CITY MANAGER (Continued) The City Manager indicated monies are being expended from the current budget, and the City does not have to go back to reserves to get the initial purchase going. Approximately $800,000 next year will allow the City to move ahead by the reduction of Workers' Compensation and Liability funds. MOTION SECOND AYES ABSENT Slater Coontz Barrera, Mayor Coontz, Spurgeon, Slater Murphy Moved to approve Phase I in the amount of $620,368.00; authorize the City Manager to sign a contract in the amount of $250,000.00 beginning of the Local Area Network; approve the transfer of funds, and Phase II in concept.8. LEGAL AFFAIRS 8. 1 ORDINANCE NO. 13-96 (FIRST READING)An Ordinance of the City Council of the City of Orange amending Chapter 5.78 of the Orange Municipal Code relating to the regulation of vehicles for hire. (A2500.0)MOTION SECOND AYES ABSENT Barrera Coontz Barrera, Mayor Coontz, Spurgeon, Slater Murphy Moved that Ordinance No. 13- 96 have first reading waived and same was set for second reading by the preceding vote.Councilmember Murphy entered the meeting at 6:45 p.m.)9. RECESS TO THE MEETING OF THE ORANGE REDEVELOPMENT AGENCY 10. ORAL PRESENTATIONS WilI Fitzpatrick, 1135 N. Glassell, representing Fatman Productions, expressed appreciation to the Council, Fire Department and Police Department for their assistance with a car show on April 14th.Susan Parker, 2226 E. Mayfair, expressed concern with the unsafe conditions of play equipment at Handy Park. She reported that her neighborhood submitted a petition to Council, and thanked them for their timely response. Mayor Coontz responded that letters and phone calls received by the Council are handled on the Mayor's hotline. Writing a letter or submitting a petition involves more effort, and these issues are also handled within 48 hours, which is a newly established policy.PAGE IS CITY COUNCIL MINUTES May 14,1996 11. RECESS MOTION SECOND AYES Murphy Coontz Murphy, Barrera, Mayor Coontz, Spurgeon Slater The City Council recessed at 7:00 p.m. and reconvened at 7:20 p.m.NOTE: The Closed Session was continued until after the 7:00 p.m. session.a. Conference with Legal Counsel pursuant to Government Code Section 54956.9 - existing litigation. City of Orange vs. James Daum, et al., Orange County Superior Court Case No. 73-86-30.b. Conference with Legal Counsel - anticipated litigation. Initiation oflitigation pursuant to Government Code Section 54956.9(c) (one potential case).c. Conference with Labor Negotiator pursuant to Government Code Section 54957.6:City Negotiator: Personnel Director.Employee Organization: All Employee Organizations (List Available in Personnel Office).d. Public employee appointment pursuant to Government Code Section 54957: City Attorney.e. Acquisition of real property pursuant to Government Code Section 54956.8:Property: 292 N. Main St.Negotiating Parties: Kenneth and Tommye Hahn Negotiating: Price and Terms of Payment f. To consider and take possible action upon such other matters as are orally announced by the City Attorney, City Manager, or City Council prior to such recess unless the motion to recess indicates any of the matters will not be considered in Closed Session.7:00 P. M. SESSION 12.1 INVOCATION Tom Clark, member of the Lions Club 12.2 PLEDGE OF ALLEGIANCE TO THE FLAG Led by Councilman Mark Murphy 12.3 ANNOUNCEMENTS - None 12.4 INTRODUCTIONS - None PAGE 18 CITY COUNCIL MINUTES May 14,1996 12.5 PROCLAMATIONS - None 12. 6 PRESENTATIONS - None 13.PUBLIC HEARINGS Tape 4780 13.1 SERRANO HEIGHTS COMMUNITY FACILITIES DISTRICT 91-2, CITY OF ORANGE: Time set for a public hearing on petition by the City of Orange to consider the alteration of the Rate and Method of Apportionment of the Special Taxes and Authorized Facilities for such areas and otherwise amend approved Bonded Indebtedness and Appropriation Limit for such areas pursuant to Resolution No. 8607, adopted April 9, 1996 by the City Council of the City of Orange. ( T1100.0.2 CFD-91- 2)The Director of Public Works reported that Council previously approved rates and methods of apportionment for the district on two occasions. The changes are to divide the Community Facilities District into two improvement areas, which provides for more equity for distribution of the improvement costs, and allows more uniformity in the tax rates that may be applied in the area.The total bonded indebtedness that could be incurred would be raised from $20 million to $ 31 million, however, is subject to further review while going through the process of issuing bonds for the district at a future date.The maximum amount of the property tax bill is increased, but is stilI below the maximum that is considered to be the limit in industry practice, which is 2%. The previous rate was approximately 1.5%, which would be increased to 1.8% as the maximum that could be allowed.An additional deposit in the amount of $90,000 was requested from the developer as an advance to defray the up-front administrative costs for the district, which would later be reimbursed from bond proceeds. That reimbursement has been received and is on deposit with the City, so the developer is current with all costs that were incurred by City staff and the consultants which are not on contingency. Sufficient funds were deposited to advance the project up to the point of issuing bonds.Mayor Coontz read a statement that the purpose of this hearing was to inquire into the alteration of the rate and method of apportionment of special taxes of the district.Mayor Coontz asked if any property owner or registered voter in the district wished to file written protest. There was no response.MAYOR COONTZ OPENED THE PUBLIC HEARING.THERE BEING NO COMMENTS, MAYOR COONTZ CLOSED THE PUBLIC HEARING. CITY COUNCIL MINUTES May 14,1996 13. PUBLIC HEARINGS (Continued) RESOLUTION NO. 8622 A Resolution of the City Council of the City of Orange calling Special Election regarding establishment of improvement areas within the City of Orange Community Facilities District No. 91-2 (Serrano Heights Public Improvements), and determining the rate and method of apportionment of special taxes, the authorized facilities, and the bonded indebtedness and appropriations limits for such areas. MOTION SECOND AYES Murphy Barrera Murphy, Barrera, Mayor Coontz, Spurgeon, Slater Moved that Resolution No. 8622, as introduced, be adopted and same was passed and adopted by the preceding vote.Mayor Coontz asked the City Clerk to open the ballot and announce the election results The City Clerk reported that there were 226 votes in favor for Improvement Area No. 1 and 307 votes in favor for Improvement Area No.2. The City Clerk will complete one copy of the canvas and statement of results of election.The results of the election being unanimously in favor of the alteration of the rate and method of apportionment of taxes, Mayor Coontz stated that the Council could now proceed with the final actions for the district.RESOLUTION NO. 8623 A Resolution of the City Council of the City of Orange determining that the rate and method of apportionment of special taxes, the facilities to be financed by and the bonded indebtedness limit and the annual appropriations limit for Improvement Area No. 1 and Improvement Area No.2 of the City of Orange Community Facilities District No. 91-2 (Serrano Heights Public Improvements) are lawfully authorized and direct recording of second amendment to notice of special tax lien. MOTION SECOND AYES Slater Barrera Murphy, Barrera, Mayor Coontz, Spurgeon, Slater Moved that Resolution No. 8623, as introduced, be adopted and same was passed and adopted by the preceding vote. PAGE 21 CITY COUNCIL MINUTES May 14,1996 13. PUBLIC HEARINGS (Continued) 13.2 JOINT PUBLIC HEARING WITH THE ORANGE REDEVELOPMENT AGENCY, PROPOSED SALE OF PROPERTY, CITY OF ORANGE: Time set for a joint public hearing to consider the proposed sale of land, without public bidding, of certain real property owned by the Orange Redevelopment Agency. The purchasers are Grace Aou, or Assignee. Subject property is located at 4629/4649 East Walnut Avenue. (p2500.0.1) The Director of Community Development reported that some time ago the Agency acquired the property at 4629/4649 E. Walnut, The intent at the time was to develop an affordable housing project. Council permission was given to dispose of the property, as the affordable housing potential did not appear to be there. The property was listed and a offer was received for 275,000. A right-of-way improvement estimated at approximately $20,000 would be completed by the property owner.Sandy Garcia, 4625 E. Walnut, stated the property address in question is 4649 Walnut, and that the advertisement for the sale of the property was not published in an Orange newspaper. Ms.Garcia requested reimbursement for maintaining the property from 1992 until 1996; questioned the intent of the purchase and the correct zoning for the property. She expressed her interest in buying the property, however, she did not receive notification that the property was for sale, and the realtor's property sign is misleading.Mayor Coontz confirmed from the City Clerk that the advertisement was published in an Orange newspaper.The Director of Community Development reported the zoning on the property is R- I-7, which is single-family residential, 7,000 sq. ft. minimum lot size. It is unknown how the property will be used in the future, however, if the property is used for something other than for a single-family residence, it would require a subdivision action, or public hearing before the Planning Commission and the City Council, which would include mailed notification to property owners within a 300 foot radius.Housing Manager Mary Ellen Laster reported the Assessor's office lists the property as 4629 Walnut, however the mailbox lists 4649 Walnut Avenue. It is unknown if the property was split at one time, however, there is a small building behind the single-family home, which may be the reason for the two addresses.Douglas Anuner, 532 N. Hamlin Street, questioned the address, zoning, and intended use of the property.Barbara DeNiro, 1118 E. Adams, inquired what the purchase price of the property was to the Redevelopment Agency.The Director of Community Development responded the Agency purchase price was $300,000.AI Ricci, 616 E. Chapman Avenue, realtor for the subject property, stated the title company refers to the parcel as 4629. He explained the wording on his real CITY COUNCIL MINUTES May 14,1996 13. PUBLIC HEARINGS (Continued) The City Attorney reported that no one was prejudiced by the advertisement. The advertisement is accurate as far as the assessors description, and therefore, the notice is accurate, and would not preclude any action by the Redevelopment Agency or City Council. RESOLUTION NO. 8625 A Resolution of the City Council of the City of Orange consenting to and approving the Orange Redevelopment Agency's sale of real property pursuant to Health and Safety Code Sections 33430 and 33431 and making certain findings. MOTION SECOND AYES Murphy Slater Murphy, Barrera, Mayor Coontz, Spurgeon, Slater Moved that Resolution No. 8625 as introduced, be adopted, and same was passed and adopted by the preceding vote.14. PLANNING AND ENVIRONMENT - None 15. ORAL PRESENTATIONS Carole Walters, 534 N. Shaffer, asked why one area of the City gets more stop signs than other areas, and requested the City take out the stop sign at Walnut Avenue and Center Street.Council directed the Director of Public Works to place the location of Walnut and Center on the Traffic Commission agenda. Barbara DeNiro, 1118 E. Adams, expressed concern relative to the dangerous intersection at Cambridge and Palm. She asked how many department heads live in the City of Orange; and asked if the City Manager is still the Fire Chief?The City Manager responded that he is still the Fire Chief He asked in his contract that his 24 years with the City be considered, and for the first six months he served as Interim City Manager,the Council allowed him the ability to go back as Fire Chief. Council has given him the ability to return to his Fire Chief position until September 13, 1996. He will discuss the issue of how many department heads live in the City of Orange and provide Ms. DeNiro with that information.6.5 Approval of HOME Agreement with Orange Garden Apartments LLC to provide funding in the amount of $769,250 (HOME Funds) for the acquisition and rehabilitation of the apartment buildings located at 1931, 1941 and 2003 Quincy Street.NOTE: This item was continued from the 4:30 p.m. session.The City Manager gave a synopsis of changes which have occurred to the agreement. He stated he would not be able to provide, at this time, sufficient copies of the red-lined items, to show the exact language changes. There were some minor language changes that occurred today, and that PAGE 23 CITY COUNCIL MINUTES May 14,1996 6. ADMINISTRATIVE REPORTS (Continued) is the reason for an incomplete document. The major issue was the change in partnership. Mr. Sciuto was written out of the document, and Mr. Sommerville and Mr. Conzelman were included. A major issue that was changed and enhanced regarding indemnification was the additional security of $250,000. A clause was changed regarding no payments on the note, due to the fact that it is a loan, which turns into a grant, at 54 1/2 years. He explained additional language that allows a transfer of title between either one of the corporations, to sell the property and make a profit to someone else, and allows for full Agency review and approval. Councilman Slater stated he knew the document had gone through a lot of metamorphisis, but doesn't recall, before the changes were made, that there was a time when there was a completed document that was ready to be signed. The City Manager responded that even at the March meeting there was some of this type of language changes that the Council had directed him, or given him the executive authority, to go back and make such decisions that he felt impacted the liability or security of the agency. That is why a document had not been signed to date. There is language contained in the document that would have allowed it to be purchased by the three individuals. If Mr. Sciuto had stayed a partner, the property could have been purchased by the three individuals, Mr. Crume, Mr. Cottle and Mr. Sciuto, and then a request for transferring title to the limited liability corporation. That is the kind ofIanguage that he commented he just reviewed, and the Agency would have had the ability to approve it. Because title could not be taken by the three individuals because one the principals was no longer a part, and a letter was submitted to withdraw their offer, he didn't feel it would be a responsible action on his part to assume that the Council would want to go forth with the limited liability companies, when the principals had changed. That is why the document was brought back. Councilman Murphy reported that although he agreed with the project, in concept, he would like to see the written agreement before voting on it, and recommended the item be continued long enough to provide an opportunity for review. Councilmembers determined it would be necessary to continue the item to provide an opportunity to review the final documents. Kevin Teal, representing Great Western Bank, stated that two days would not kill the deal. Great Western wants to review the document between the development company and the City, adding that there is no guarantee if the City approves the deal, that Great Western Bank's Investment Committee is going to approve it. MOTION SECOND AYES Murphy Mayor Coontz Murphy, Barrera, Mayor Coontz, Spurgeon, Slater Moved to continue this item to an Adjourned Regular Meeting on May 16, 1996 at 4:30 p.m. for Council to review changes in the document.PAGE 24 CITY COUNCIL MINUTES May 14,1996 ADJOURNMENT MOTION SECOND AYES Murphy Barrera Murphy, Barrera, Mayor Coontz, Spurgeon, Slater The City Council adjourned at 9:40 p.m. to Thursday, May 16, 1996 at 4:30 p.m. in the Council Chambers.CASSANDRAJ.C! TYCLERK L;.:; JOANNE C. COONTZ ./}MAYOR .. PAGE 26