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HomeMy WebLinkAbout94-088 CC ResolutionRF_.SOLUTION NO. 94-88 A RESOLUTION OF ~ CITY COUNCIL OF THE CITY OF TEMECULA APPROVING THE LEASE OF PROPERTY WITHIN SAM HICKS MONUMENT PARK FOR THE TEMECULA MUSEUM The City Council of the City of Temecula does hereby determine, resolve, and order as follows: Section 1. Findings. The City Council hereby makes the following findings: A. The City acquired title to certain real property located in the City of Temecula, County of Rivea'side, State of California, known as Sam Hicks Monument Park (the "Park"), on or about April, 1991 from the Sam Hicks Monument Park Foundation. B. Upon acquisition by the City, the Park was subject to a Museum Lea~ between the City and the Temecula Valley Museum, Inc (the "Corporation") dated January 1, 1991, which contemphted the construction of a 3,000 square foot Museum and also the relocation of a 1,200 square foot church within the Park. C. On July 15, 1992, the City acquired title to certain real property adjoining the Park, known as the "L-Shaped Parcel." This Parcel was added to the Park. The purchase price for the L-Shaped Parcel was $1,050,000, of which the Temecula Redevelopment Agency paid $400,800 from tax increment monies. D. The Corporation has revised its plans for the Museum, and now desires to construct a 22,900 square foot building, in phases. The first phase will consist of a 6,100 square foot Museum, an 1,800 square foot plaza and a 1,000 square foot outdoor interpretive center, along with renovation of the church. The Museum will be built on the L-Shaped Parcel, but the church will be located on the original park land. E. The Museum is to be open to the public. It will house the Temecula Museum Collection, consisting of art objects, artifacts papers, photographs, architectural elements and other items of aesthetic, cultural or historical significance relating to the Temecula region. The Corporation shall operate the Museum for the preservation, interpretation and exhibition of the Temecula Museum Collection and for educating the public regarding the Temecula region. F. The Museum is to be located within Sub Area 3 of the Temecula Redevelopment Project Area, adjacent to the Old Town Temecula portion of the Project Area. Redevelopment of the economic base of Old Town Temecula requires attracting tourists not only from within Riverside County and adjacent Counties, but also from beyond Southern California. It further Resos 94-88 1 requires making Old Town Temecula into the cultural heart of the surrounding Temecula Valley. Locating, constructing and operating the Temecula Museum adjacent to Old Town is critical to achieving these objectives. By creating a cultural center to the Temecula Valley, the Museum will attract tourists, stimulate economic growth, and benefit the Project Area. G. The following blighthag conditions are present within Old Town: 1. Old buildings that do not meet current seismic standards; 2. Lack of adequate on-street and off-street parking; 3. Subdivided lots of inadequate size for proper usefulness and development that are in multiple ownership; 4. Stagnant and depreciating property values; and Incompatible adjacent uses that serve to prevent economic development in its own funds. The Corporation lacks sufficient resources to construct the Museum entirely with Consequently, City and Redevelopment Agency assistance is required. I. leasing land purchased with tax increment monies to the Museum at below fair market value, and providing City resources to fund construction of the Museum will stimulate economic growth, and thereby help eliminate the above blighting conditions. J. Pursuant to Health and Safety Code 33433, the City has made available to the public a copy of the I_ease with the Corporation for construction and operation of the Museum. The City has also made available to the public a summary providing the following information concerning the DDA: 1. The cost of the "L-Shaped Parcel" to the Agency was $400,800. The appraised value of this Parcel as of July 1991 was $900,000 according to the City's appraisal, and $1,245,000 according to the then-owner's February 1992 appraisal. The actual purchase price was $1,050,000 or ($15.75 per square foot), of which the Agency funded $400,800. 2. The Redevelopment Plan permitted the Museum footprint, as well as the Lo Shaped Parcel to be developed as Scenic-Highway Commercial. Consequently, the highest and best use for the Museum footprint under the Plan is approximately the original purchase price of $15.75 per square feet, or $360,675 for the 22,900 square foot footprint. However, since the July 15, 1992 purchase of the L-Shaped Parcel, prices have declined. As an example, an appraisal completed for the City on an adjacent comparable property on August 13, 1993 reflects a fair market value of only $10.36 per square foot. Consequently, the current market value of the Reso~ 94-88 2 footprint is estimated to be $237,244. 3. Also, since the purchase of the L-Shaped Parcel, the City adopted its General Plan in November 1993, and the Old Town Specific Plan in February, 1994. These documents restrict the highest and best use of the Museum footprint primarily to cultural and civic uses. This restriction substantially reduces the estimated value of the Museum footprint to be leased to the Foundation. 4. The total rental value of Museum footprint over the 40 year lease and the 20 year option period is $60, which is substantially less than the fair market value of the footprint. K. Leasing the Museum footprint to the Corporation at less than the fair market value of the site will assist in the elimination of the above-referenced blighfing conditions because the existence of the Museum will further establish Old Town Temecula as the cultural heart of the Temecula Valley. The Museum will assist in attracting tourists from beyond the City, thereby stimulating economic activity in the Old Town Temecula area by providing a customer base for restaurant, retail and entertainment uses. Section 2. Based upon the above findings, the City Council of the City of Temecula hereby approves the leasing of the Museum footprint to the Temecula Valley Museum, Inc., for the purposes of construction of the Temecula Valley Museum. PASSED, APPROVED AND ADOPTED, this 23rd day of August, 1994. ATTEST: [SEAL] Rcnos 94-88 3 STATE OF CALIFORNIA) COUNTY OF RIVERSIDE)ss CITY OF TEMECULA ) I, June $. Greek, City Clerk of the City of Temecula, do hereby certify that the foregoing Resolution No. 94-88 was duly and regularly adopted by the City Council of the City of Temecula at a regular meeting thereof held on the 23rd day of August 1994, by the following vote: 4 COUNCILMEMBERS: Birdsall, Mufioz, Parks, Roberts NOES: 0 COUNCILMEMBERS: None ABSENT: 0 COUNCILMEMBERS: None ABSTAIN: 1 COUNCILMEMBERS: Stone Resos 94-88 4 SUMMARY REPORT PURSUANT TO SECTION 33433 OF THE CALIFORNIA COMMUNITY REDEVELOPMENT LAW ON AN AMENDED AND RESTATED LEASE BY AND BETWEEN THE CITY OF TEMECULA AND THE TEMECULA VALLEY MUSEUM INC. This summary report has been prepared by the Temecula Redevelopment Agency ("Agency") pursuant to Section 33433 of the California Health and Safety Code. This report sets forth certain details in the proposed amended and restated lease agreement ("Lease") between the City of Temecula ("City") and the Temecula Valley Museum, Inc. ("Corporation"). The Lease requires the City to lease property located adjacent to Sam Hicks Monument Park to the Corporation for the purpose of constructing a museum. The property to be leased includes a parcel that was purchased in part from tax increment monies. As required by the Community Redevelopment Law, this report describes and specifies: 1. The cost of the proposed lease to the Agency; The estimated value of the interests proposed to be leased determined at the highest uses permitted under the Redevelopment Plan; The purchase price and sum of the lease payments to be paid by the Corporation for the interests being leased; and The means by which the lease of the property at less than fair market value will assist in the removal of blight. P:qUMMARY.LS This report and the proposed lease are to be made available for public inspection prior to the approval of the Lease. SUMMARY OF TH3E LEASE A. The City acquired title to certain real property located in the City of Temecula, County of Riverside, State of California, known as Sam Hicks Monument Park (the "Park"), on or about April, 1991 from the Sam Hicks Monument Park Foundation. B. Upon acquisition by the City, the Park was subject to a Museum Lease between the City and the Temecula Valley Museum Inc., dated February 12, 1991, which contemplated the construction of a 3,000 square foot Museum and also the relocation of a 1,200 square foot Church within the Park. C. On July 15, 1992, the City acquired title to certain real property adjoining the Park, known as the "L-Shaped Parcel." This Parcel was added to the Park. The purchase price for the L-Shaped Parcel was $1,050,000, of which the Temecula Redevelopment Agency paid $400,800 from tax increment monies. D. The Corporation has revised its plans for the Museum, and now desires to construct a 22,900 square foot building, in phases. The first phase will consist of a 6,100 square foot Museum, an 1,800 square foot plaza and a 1,000 square foot outdoor interpretive center, along with renovation 'of the church. The Museum will be built on the L-Shaped Parcel, but the church will be located on the original park land. E. The Museum is to be open to the public. It will house the Temecula Museum Collection, consisting of art objects, artifacts, papers, photographs, architectural elements and other items of aesthetic, cultural or historical significance relating to the Temecula region. The Corporation shall operate the Museum for the preservation, interpretation and exhibition of the Temecula Museum Collection and for educating the public regarding the Temecula region. F. The Museum is to be located within Sub Area 3 of the Temecula Redevelopment Project Area, adjacent to the Old Town Temecula portion of the Project Area. Redevelopment of the economic base of Old Town Temecula requires attracting tourists not only from within Riverside County and adjacent Counties, but also from beyond Southern California. It further requires making Old Town Temecula into the cultural heart of the surrounding Temecula Valley. Locating, constructing and operating the Temecula Museum adjacent to Old Town is critical to achieving these objectives. By creating a cultural center to the Temecula Valley, the Museum will attract tourists, stimulate economic growth, and benefit the Project Area. G. The following blighting conditions are present within Old Town: P:SUMMARY.I..$ 1. Old buildings that do not meet current seismic standards; 2. Lack of adequate on-street and off-street parking; Subdivided lots of inadequate size for proper usefulness and development that are in multiple ownership; 4. Stagnant and depreciating property values; and Incompatible land uses that serve to prevent economic development in the area. H. The Corporation lacks sufficient resources to construct the Museum entirely with its own funds. Consequently, City and Redevelopment Agency assistance is required. I. Leasing land purchased with tax increment monies to the Museum at below fair market value, and providing City resources to fund construction of the Museum will stimulate economic growth, and thereby help eliminate the above blighting conditions. I. Pursuant to Health and Safety Code 33433, the City has made available to the public a copy of the Lease with the Corporation for construction and operation of the Museum. The following information describes the Redevelopment Agency's participation in the purchase of the property to be leased: 1. The cost of the "L-Shaped Parcel" to the Agency was $400,800. The appraised value of this Parcel as of July 1991 was $900,000 according to the City's appraisal, and $1,245,000 according to the then-owner's February 1992 appraisal. The actual price was $1,050,000 or ($15.75 per square foo0, of which the Agency funded $400,8O0. 2. The Redevelopment Plan permitted the Museum footprint, as well as the L-Shaped Parcel to be developed as Scenic-Highway Commercial. Consequently, the highest and best use for the Museum footprint under the Plan is approximately the original purchase price of $15.75 per square foot, or $360,675 for the 22,900 square foot footprint. However, since the July 15, 1992 purchase of the L-Shaped Parcel, prices have declined. As an example, an appraisal completed for the City on an adjacent comparable property on August 13, 1993 reflects a fair market value of only $10.36 per square foot. Consequently, the current market value of the footprint is estimated to be $237,244. 3. Also, since the purchase of the L-Shaped Parcel, the City adopted its General Plan in November, 1993, and the Old Town Specific Plan in February, 1994. These documents restrict the highest and best use of the Museum footprint primarily to cultural and civic uses. This restriction substantially reduces the estimated value of the Museum footprint to be leased to the foundation. P:$UMMA~Y,L$ 4. The total rental value of Museum footprint over the 40 year lease and the 20 year option period is $60, which is substantially less than the fair market value of the footprint. K. Leasing the Museum footprint to the Corporation at less than the fair market value of the site will assist in the elimination of the above-referenced blighting conditions because the existence of the Museum will further establish Old Town Temecula as the cultural heart of the Temecula Valley. The Museum will assist in attracting tourists from beyond the City, thereby stimulating economic activity in the Old Town Temecula area by providing a customer base for restaurant, retail and entertainment uses. P:$UMMARY.L~