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HomeMy Public PortalAboutA2010-01-05LRA~~~~°~ LYNUVOOD REDEVELOPMENT AGENCY n°'~~P 11330 BLILLIS ROAD LYNWOOD, CALIFORNIA 90262-3845 (310) 603-0220 `gCJF ° gti Maria T. Santillan, Chair Aide Castro, Vice Chair Alfredo Flores, Member Jim Morton, Member Ramon Rodriguez, Member This Agenda contains a brief general description of each item to be considered. Copies of the Staff reports or other written documentation relating to each item of business referred to on the Agenda are on file in the Office of the City Clerk and are available for public inspection. Materials related to an item on this Agenda submitted to the Agency Board after distribution of the Agenda packet are available for public -nspection at the Agency Secretary's office at the above address during normal business hours. Any person who has a question concerning any of the agenda items may call the City Manager at (310) 603- 0220, ext. 200. ~~,~ ~os~ ~~® AGENDA LYNWOOD REDEVELOPMENT AGENCY JANUARY 5, 2010 REGULAR MEETING 5:00 P.M. LYNWOOD CITY HALL, 11330 BULLIS ROAD MARIA T. SANTILLAN CHAIR AIDE CASTRO VICE CHAIR JIM MORTON MEMBER ROGER L. HALEY EXECUTIVE DIRECTOR DEC 3 1 209 CITY CLERICS OFFICE 17/~ cwt ~~~ Z G~~ (,~i~ y~ ~ S ALFREDO FLORES MEMBER RAMON RODRIGUEZ MEMBER FRED GALANTE AGENCY COUNSEL OPENING CEREMONIES: A. Call Meeting to Order B. Roll Call (FLORES-MORTON-RODRIGUEZ-CASTRO-SANTILLAN) C. Certification of Agenda Posting by Secretary PUBLIC ORAL COMMUNICATIONS (Regarding Agenda Items Only) PUBLIC ORAL COMMUNICATIONS CONSENT CALENDAR All matters listed under the Consent Calendar will be acted upon by one motion affirming the action recommended on the agenda. There will be no separate discussion on these items prior to voting unless members of the Agency or staff request specific items are removed from the consent calendar for separate action. 1. RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY OF LYNWOOD, CALIFORNIA, ALLOWING AND APPROVING THE DEMANDS AND WARRANTS. 2. APPROVAL OF THE EXCLUSIVE NEGOTIATING AGREEMENT BETWEEN THE LYNWOOD REDEVELOPMENT AGENCY AND FRESH AND EASY NEIGHBORHOOD MARKETS, INC" Comments: Lynwood Redevelopment Agency staff and Legal Counsel negotiated an Exclusive Negotiating Agreement ("ENA") with Fresh and Easy Neighborhood Markets, Inc. ("Developer"). The agreement pertains to the development of approximately 1.02 acres of real property, as shown on Exhibit "A" and includes the parcel commonly described as 3187- 3189 Norton Avenue in the City of Lynwood, which is owned by the Redevelopment Agency. Developer proposes to lease the Agency owned parcel in order to redevelop the site with a state-of-the-art Fresh & Easy Neighborhood Market. The project will be comprised of approximately 10,550 square feet of new building area and approximately 46 on-site improvements as appropriate and necessary for applicable City regulations and standards ("Activity"). Any proposed tenants other than Fresh & Easy Neighborhood Market, must be approved by the Agency, based on credit worthiness, financial capability, experience or similar factors. 2 Recommendation: Staff recommends that the Agency adopt the attached Resolution entitled: "A RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY OF THE CITY OF LYNWOOD, CALIFORNIA APPROVING AN EXCLUSIVE NEGOTIATION AGREEMENT BETWEEN THE LYNWOOD REDEVELOPMENT AGENCY AND FRESH & EASY NEIGHBORHOOD MARKET, INC." 3. ACCEPTANCE OF A LOAN FROM THE CALIFORNIA POLLUTION CONTROL FINANCING AUTHORITY TO ASSESS THE ALAMEDA TRIANGLE SITE Comments: In 2005 the Lynwood Redevelopment Agency (Agency) entered into a Disposition and Development Agreement with Casa Grande, LLC to develop a 12 acre site bounded by Fernwood Street, Alameda Street, and Imperial Highway for single family homes. After a review of existing available environmental records and several meetings with the Department of Toxic Substance ("DTSC"), staff has determined that additional remedial investigation and a detailed remedial action plan will be required by DTSC to prepare the site for development. On May 6, 2009 the Agency Board authorized staff to apply for a low interest loan from the Center for Creative Land Recycling (CCLR) and on August 27, 2009 the Agency received a letter of approval for the loan. As the California Pollution Control Financing Authority is the originator of the loan, staff requests authority to enter into the loan agreement with the California Pollution Control Financial Authority. Recommendation: Staff recommends that the Lynwood Redevelopment Agency adopt the attached resolution entitled, "A RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY OF THE CITY OF LYNWOOD CALIFORNIA AUTHORIZING THE EXECUTIVE DIRECTOR TO ACCEPT ALOW-INTEREST, FORGIVABLE LOAN OF UP TO $500,000 FROM THE CALIFORNIA POLLUTION CONTROL FINANCING AUTHORITY". CLOSED SESSION NONE ADJOURNMENT THE NEXT REGULAR MEETING WILL BE HELD ON JANUARY 19, 2010 AT 5:00 P.M. IN THE COUNCIL CHAMBERS OF CITY HALL, 11330 BULLIS ROAD, LYNWOOD, CALIFORNIA. j (1F Y,V I~~\~ f 4~~ ~J ~. £a ~ " AGENDA STAFF REPORT `<„ LR OaN~r _~ '`,; -, °b DATE January 5, 2010 TO: Honorable Chairperson and Members of the Agency Board APPROVED BY: Roger L. Haley, Executive Director~Q PREPARED BY: Robert S. Torrez, Assistant City Manager - Adm?fiistrative & Community Services Monica Ochoa, Accounting Technician SUBJECT: Approval of the Warrant Register Recommendation: Staff respectfully recommends that the Agency Chairperson and Board Members approve the warrant register for Fiscal Year 2009-2010. 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O O ~ w Y C R m .Q 7 (6 m O V Y C t0 .O O N d L V 7 H d t V O t6 O H O Q L H t C .y d L V 3 O N u~ m a I / l } a~, --~~ ~~~ AGENDA STAFF REPORT ,,~y~ ~,. ~~ DATE: January 5, 2010 TO: Honorable Chair and Members of the Agency Board ~~ APPROVED BY: Roger L. Haley, Executive Director PREPARED BY: Sarah Magana Withers, Director of Redevelopment SUBJECT: Approval of the Exclusive Negotiating Agreement between the Lynwood Redevelopment Agency and Fresh ~& Easy Neighborhood Market, Inc. Recommendation: Staff recommends that the Agency adopt the attached Resolution entitled: "A~ RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY OF THE CITY OF LYNWOOD, CALIFORNIA APPROVING AN EXCLUSIVE NEGOTIATING AGREEMENT BETWEEN THE LYNWOOD REDEVELOPMENT AGENCY AND FRESH & EASY NEIGHBORHOOD MARKET, INC." Background: Lynwood Redevelopment Agency Staff and Legal Counsel negotiated an Exclusive Negotiating Agreement ("ENA") with FRESH AND EASY NEIGHBORHOOD MARKETS, INC ("Developer/Tenant"). The agreement pertains to the development of approximately 1.02 acres of real property, as shown on Exhibit "A" and includes the parcel commonly described as 3187-3189 Norton Avenue in the City of Lynwood, which is owned by the redevelopment agency. Developer/Tenant proposes to lease the agency owned parcel in order to redevelop the Site with astate-of-the-art Fresh & Easy Neighborhood Market. The project will be comprised of approximately 10,550 square feet of new building area and approximately 46 on-site parking spaces. The DeveloperlTenant will provide all required off-site improvements as appropriate and necessary for applicable City regulations and standards ("Activity"). Any proposed tenants other than Fresh & Easy Neighborhood Market, must be approved by the Agency, based on credit worthiness, financial capability, experience or similar factors. The DeveloperlTenant also proposes to switch/swap the Agency owned parcel 6170-034-024, to be transferred as an even exchange for the Developer owned parcels 6170-034-023 and 6170-034-023. The entire switch/swap land area will ITEM equal the same size and characteristics. The Developer/Tenant will also lease the Agency owned land approximately 6,278 square feet for a period of 40 years to be exclusively used as a parking lot for the market. At anytime during the term of the lease, the Developer/Tenant can elect to purchase the property at its sole option for Fair Market Value (FMV). The lease term will include eight 5-year renewal options. Following execution of this Agreement and through the period of negotiation and preparation of an Owner Participation Agreement ("OPA") and Lease Agreement ("Lease") with respect to the Activity, Agency staff and Legal Counsel will work with third parties in connection with the proposed Activity, and in negotiating and preparing an OPA and Lease Agreement consistent with the basic terms and mutual understandings established in the Agreement. Agency and Developer desire to enter into this Agreement in order to set forth the rights and duties of the Parties during the term of the Exclusive Negotiating Period subject to the Owner Participation rules and regulations established for the Project Area. Discussion & Analysis: The Redevelopment Plan for Project Area "A" was adopted by the Lynwood City Council on July 10, 1973 and was subsequently amended. The Redevelopment Plan provides for the orderly development of new affordable housing for low and moderate income families, employment opportunities, and increased community access to business and retail services. The project, as proposed by the Developer and embodied in the proposed ENA, envisions the development of a 1.02 acre site within Project Area "A" for a shopping center comprised of retail and commercial uses. The Third Five Year Redevelopment Implementation Plan sets the following specific goals for Project Area "A": • The improvement of the range and quality of housing in the Project Area; • The provision of land for recreational, community, educational and commercial facilities and services to meet the needs of the Project "A" area; • The return of a large part of the under-developed and vacant Project Area land to greater use; • The employment of local residents in the construction and operation of various development and other Redevelopment Plan implementing activities; and • The encouragement and stimulation of investment in businesses within the Project Area. The proposed project includes the assemblage of five (5) parcels on a 1.02 acre site. Partnering with an experienced and well capitalized developer/tenant such as Fresh & Easy, Neighborhood Market, Inc will eliminate blight and enhance the economic vitality of the City of Lynwood. The "ENA" period of 12 months, with an allowance of one extension for no longer than sixty (60) additional days at the 2 discretion of the Executive Director, the Agency will exclusively negotiate with the Developer/Tenant on the terms of an Owner Participation Agreement and Lease Agreement. There are certain performance obligations on both the Agency and the Developer that must be met within a certain period of time. The Developer will be required to place a deposit to pay for Agency Counsel and consultants' fees in connection with the negotiations. The developer and the Agency will use this time to determine the project's feasibility and benefits to the Project Area. The anticipated assessed valuation when the project is completed is estimated at $3 to $6 million. The Developer anticipates that the project may generate 20 new jobs and during the construction phase 50 to 100 jobs may be created. Fiscal Impact: There is no fiscal impact associated with the recommendation contained in this report. The proposed ENA requires the Developer to provide the Agency an initial deposit of $5,000 to cover Agency related costs under the ENA terms. The Developer will need to replenish the deposit upon request from the Agency. Coordinated With: Agency Counsel Finance & Administration Attachments: Exhibit A -Site Plan Parcel Map Exclusive Negotiating Agreement RESOLUTION NO. A RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY OF THE CITY OF LYNWOOD, CALIFORNIA APPROVING AN EXCLUSIVE NEGOTIATING AGREEMENT BETWEEN THE LYNWOOD REDEVELOPMENT AGENCY FRESH & EASY NEIGHBORHOOD MARKET, INC. WHEREAS, the Lynwood Redevelopment Agency ("Agency") is engaged in activities necessary to carry out and implement the Redevelopment Plan for Project Area "A"; and WHEREAS, in order to carry out and implement such Redevelopment Plan and the Implementation Plan the Agency is desirous of entering into this Exclusive Negotiating Agreement with Fresh & Easy Neighborhood Market, Inc., a Delaware Corporation ("Developer"); and WHEREAS; the Agency has duly considered all of the terms and conditions of the proposed Exclusive Negotiating Agreement and believes that the proposed Exclusive Negotiating Agreement is in the best interest of the Agency and the health, safety, morals and welfare of its residents, and in accord with the public purposes and provision of applicable state and local law and requirements. NOW THEREFORE, THE LYNWOOD REDEVELOPMENT AGENCY OF THE CITY OF LYNWOOD DOES HEREBY RESOLVE AS FOLLOWS: Section 1. Having carefully reviewed the terms and conditions set forth in the Exclusive Negotiating Agreement, the Agency Staff Report, and both oral and written testimony regarding the proposed Exclusive Negotiating Agreement, the Agency hereby approves the proposed Exclusive Negotiating Agreement in the form attached hereto as Attachment No. 1. Section 2. The Agency also recognizes that it has received heard all oral and written objections to the proposed Exclusive Negotiating Agreement and that all such oral and written objections are hereby overruled. Section 3. The Agency hereby authorizes the Chairperson to execute the attached Exclusive Negotiating Agreement with Fresh & Easy Neighborhood Market, Inc. Section 4: The Chair shall have the authority to enter into contracts in a form approved by the Agency Counsel with CEQA, planning, fiscal, engineering, relocation and acquisition consultants for items reimbursable by the deposit placed by the Developer. Section 5. This Resolution shall become effective immediately upon its adoption by the Agency. PASSED, APPROVED and ADOPTED this 5th day of January 2010. Maria T. Santillan Chair ATTEST: Maria Quinonez Secretary Roger L. 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(1.02 ACRES) PARKING SUMMARY FOR FRESH & EASY: REQUIRED It PER 300 S.F.): 35 STALLS PROVIDED: 43 PARKING SPACES + 3 ACCESSIBLE PARKING SPACES = 46 PARKING SPACES TOTAL ON SITE BUILDING DATA TOTAL BUILDING: 10,550 S.F. SALES AREA: 7,737 S.F. BACKROOM AREA: 2,813 S.F. n O m D r 1 1 1 1. 1 1 north PRELIMINARY SITE LAYOUT o 10 20 40 lw SCALE :1 20 I a� C U i b 1 Q Ya 4 v 1 Nelghborhonc Rladcel LYNWOOD. CA SWC LONG BEACH BLVD & PLUMA STREET ❑ F- ❑ 0 } ❑ Q o J ❑ W ❑ I� ❑ N Pa E a,o 0E. z P Psi CL KEY SITE PLAN ~a e'<< ~'~.~~~ m m m ~m ~c a o~ az 1 m~ m m m~ m m m m m ~» m. m~ Fs ~~ 9 m _ ~,~ a €€ ~ "' € 38' _ _ ^ ~ ~ ti of €~ gs n OD c m ~ .~ 3 m g ~BS 9 j ,.. _.: .... .. .... N V ^ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ^ Cl D - N ~~ e~ ~ nm o 0 m m e^ a '° y D O ~ a ~ mi n D _ EXTERIOR ELEVATIONS "~ ~' o ~aFE~~~~w ~~ ii 1BBl fA% [d9P&e]B1 ~~i K L CHARLES ARCHITECTS INC ~ ARCHITECTURE • PLANNING - J T T 111 1 4 i~ -i m "m ~~ O az ~, "i L'' i O 2 m ~m "D a -I O iz A m m ~ m m m m m m ~ m ~+ m ma ^ n ^~ m ~ ~ ~"z~ ~~' ~m >~ o K $ ~ o ~ ~E~ o Gy ~ so a~ 8= $ ~ n ~ g ~ R °s ~ a EXCLUSIVE NEGOTIATING AGREEMENT This Exclusive Negotiating Agreement ("Agreement"), dated as of this 5th day of January, 2010 ("Effective Date"), is made by and between the LYNWOOD REDEVELOPMENT AGENCY, a public body, corporate and politic ("Agency"), and FRESH & EASY NEIGHBORHOOD MARKET, INC, a Delaware Corporation ("Developer"). For and in consideration of the mutual covenants and promises set forth herein, the Parties agree as follows: RECITALS This Agreement is entered into with reference to the following facts: A. In furtherance of the objectives of the California Community Redevelopment Law, Agency has undertaken a program for the redevelopment of certain areas within the City, and in connection therewith is undertaking and carrying out activities for redevelopment in the Lynwood Redevelopment Project Area "A" ("Project Area") pursuant to and in furtherance of the Redevelopment Plan for the Project Area. B. The subject matter of this Agreement concerns that certain real property shown on Exhibit A, located at Long Beach Boulevard, abutting Pluma Street to the north and Norton Avenue to the south, in City of Lynwood, County of Los Angeles, State of California with Assessor's Parcel Numbers ("APNs") 6170-034-017, 6170-034-018, 6170-034-023, 6170-034- 024, 6170-034-025, 6170-034-026, 6170-034-029, and 6170-034-030. The subject parcels are located within the City of Lynwood, State of California and are collectively referred to herein as the "Site". The Site is comprised of approximately 44,466 square feet or 1.02 acres of land area. It is anticipated that, prior to the development of the Site as contemplated by this Agreement and/or a subsequent Disposition and Development Agreement ("DDA") as set forth herein below, parcel with APN 6170-034-24, which Agency currently owns, will be exchanged with parcels 6170-034-018 and 6170-034-023, which Developer currently owns. Thereafter, Developer will own parcel with APN 6170-034-24, and Agency will own parcels 6170-034-018 and 6170-034-023, which will be leased to Developer as a parking area. C. Developer desires to redevelop the Site with a 10,550 square feet building of new retail use, specifically a supermarket, with Developer to provide all parking on- and off-site as appropriate and necessary for the proposed development of the Site, along with appropriate landscaping, all in accordance with applicable City regulations and standards ("Activity"). D. Agency desires to enter into this Agreement with Developer with the objective of subsequently agreeing upon and entering into a mutually acceptable DDA for the development of the Site consistent with the terms and conditions of this Agreement at the earliest practical date. E. Agency anticipates that, following execution of this Agreement and through the period of negotiation and preparation of a DDA with respect to the Activity, the staff of Agency, as well as certain consultants and attorneys of Agency, will devote substantial time and effort in reviewing plans, contacting and meeting with Developer and various other necessary third parties in connection with the proposed Activity, and in negotiating and preparing a DDA consistent with the basic terms and mutual understandings established in the Agreement. O 1 095/00 1 2/75 19 1 O I Section 3. Obligations of Developer. (a) Within the time set forth in the negotiated DDA and to the extent construction financing will need to be obtained by Developer from an institutional lender(s) for the acquisition of the Site and development of the Activity, Developer shall provide Agency with a Letter of Intent (in form and substance reasonably acceptable to Agency) executed by Developer, indicating to Agency's reasonable satisfaction that such an institutional lender(s), approved by Agency, has expressed interest in financing the acquisition, construction and development of the Activity by Developer, as the case may be. Such Letter of Intent shall also outline the financial terms pursuant to which it would consider loaning money to Developer for the Activity. (b) Prior to the expiration of the Exclusive Negotiating Period, Developer shall provide an equity commitment acceptable to Agency in a manner specifically identifying the sources of all such equity financing to be used by Developer to finance the development of the Activity. In the event that the Activity is to be financed exclusively by equity financing, such equity commitment shall be in an amount sufficient to provide for the acquisition of the Site and the development of the Activity, as the case may be. Moreover, such equity commitment may also be in the form of letters of intent from investors of adequate credit-worthiness setting forth their intent to invest the equity required for this Activity. (c) Prior to the expiration of the Exclusive Negotiating Period, Developer shall provide to Agency a projected cost proforma, and a projected table describing the sources and uses of funds and cash flow projections and distributions, concerning the Activity, and a narrative describing the fundamental economics of the Activity, all in form and substance acceptable to Agency. (d) Developer has provided Agency a draft Site Plan and basic architectural renderings that include an architectural concept for the Activity showing vehicular circulation and access points, amounts and location of parking, and architectural character of the Activity. Said Site Plan and basic architectural renderings are attached hereto and incorporated herein by this reference as Exhibit "B". At or prior to 4:30 p.m. on or before the thirtieth (30th) day after the Effective Date of this Agreement, as defined above, or if a holiday, on the first succeeding business day, Developer shall deliver to Agency a more detailed Site Plan and basic architectural renderings that further depict, in addition to the above, location and size of all buildings (including height and perimeter dimensions), pedestrian circulation, and landscaping. However, notwithstanding submission by Developer as set forth herein, no such Site Plan or architectural renderings shall be deemed final until final approval by Agency, pursuant to a DDA, and by the City in their sole discretion. Section 4. Extension/Exclusive Negotiation Agreement. The Exclusive Negotiating Period shall terminate on the date that is ninety (90) days after the Effective Date of this Agreement, notwithstanding that the day may fall on a holiday. The exclusive negotiating period may be extended by the mutual consent of the parties only for up to sixty (60) additional days. Agency's Executive Director may grant each such extension for and on behalf of Agency in his/her sole and absolute discretion, unless otherwise directed by Agency. 3 01095/0012175191 Ol If the Parties have mutually consented to an extension of the term of this Agreement as provided hereinabove, then the Parties shall, within such extended term, continue to negotiate in good faith a DDA with respect to the proposed development of the Activity. Section 5. Disposition and Development Agreement. The Parties hereby acknowledge and agree that, during the term of this Agreement, (as such term may be extended pursuant to Section 4 above and subject to the applicable Owner Participation rules and regulations established for the Project Area), the Parties shall use their respective good faith efforts to negotiate and enter into a DDA which shall include (but not be limited to) the following: (i) the design of the Activity by Developer, which design shall be subject to approval by Agency and the City in their sole discretion; (ii) the construction of the Activity by Developer in accordance with final plans and specifications to be provided by Developer and approved by Agency and the City, pursuant to a detailed schedule of performance by Developer; (iii) the operation and management of the Activity by Developer in a good and professional manner, and subject to the covenants required by law; (iv) the maintenance of landscaping, buildings and improvements in good condition and satisfactory state of repair so as to be attractive to the residents and to the community; (v) the operation of the Activity by Developer in compliance with all equal opportunity standards established by Federal, State and local law; (vi) the right of Agency and the City to review the rent rolls of the Activity (to the extent applicable) and to inspect the Activity from time to time to assure compliance with the foregoing provisions; (vii) provision by Developer to Agency upon Agency's request of concepts, schematics and the final plans and working drawings for the Activity and participation in presentations with respect thereto; (viii) provision by each contractor and/or subcontractor (as the case may require and as appropriate) performing work on the Activity of the requisite performance bond and labor and materials payment bond to assure completion of the Activity free of mechanics' liens; (ix) that the Activity shall be of the highest quality and standard; (x) the terms and conditions of the disposition and exchange of Agency's parcels with Developer's parcels; 4 0 1 095/00 1 2/75 1 9 1 O I (xi) the terms and conditions of the lease of Agency's parcels (APNs 6170-034-018 and 6170-034-023) to Developer, including aforty- (40-) year lease for Developer's exclusive right to use the parcels as a parking area for the retail supermarket at a fixed rental rate that shall be adjusted with an inflator adjustment every ten (10) years during the term of the lease; (xii) the terms and conditions upon which the Agency's parcels (APNs 6170-034-018 and 6170-034-023) may be purchased by Developer, at Developer's option, during the term of the lease; (xiii) the terms and conditions upon which the Site may be assigned, transferred, or subleased; (xiv) the terms and conditions upon which either party may terminate the DDA (e.g., the discovery of environmental issues hazardous substances on the Site, unexpected development or construction costs, inability to acquire the parcels), and (xv) the guarantee of minimum levels of the costs of improvements and sales tax generation of the Activity. Section 6. Deposit: Termination. (a) Initial Deposit. Concurrent with the execution of this Agreement by Agency, Developer shall submit to Agency a good faith deposit (the "Deposit") in the amount of five thousand dollars ($5.000.00), which amount shall be reduced by any deposits concerning the Site held by Agency as of the Effective Date, to cover the actual expenses to conduct studies related to the project that will be used to establish the cost of the project i.e. appraisals, legal fees, Phase I ESA, FF & E Appraisal, etc. ("Expenses"). The Deposit shall be in the form of cash. Agency shall deposit it in an interest-bearing account and such interest, when received by Agency, shall become part of the Deposit. (b) Supplemental Deposit. If Agency subsequently determines that the Deposit is insufficient, which determination shall be based on the Expenses incurred by Agency hereunder, then upon receipt of twenty (20) days written notice from Agency, Developer shall deposit with Agency a lump sum deposit in the amount reasonably estimated by Agency to be sufficient to cover the excess (each a "Supplemental Deposit"). If Developer does not pay any Supplemental Deposit to Agency when required under this Section 6(b), work by Agency or its consultants on the project shall be suspended until the applicable Supplemental Deposit is made to Agency. (c) Accounting. Agency shall provide Developer with a monthly accounting of Agency's use of the Deposits to pay Expenses within a reasonable time after the end of each calendar month during the term of this Agreement. (d) Failure of Developer to Nel?otiate in Good Faith. In the event Developer has not continued to negotiate diligently and in good faith, Agency shall give written notice 5 01095/0012/75191.01 thereof to Developer, who shall then have ten (10) business days to commence negotiating in good faith. Following the receipt of such notice and the failure of Developer to thereafter commence negotiating in good faith within such ten (10) business days, this Agreement may be terminated by Agency/Executive Director. In the event of such termination by Agency, Agency shall have the right to retain the Deposit (including any interest accrued thereon) to cover its legal expenses and incidental costs related to the carrying out of this Agreement and negotiating a DDA with Developer, and neither party shall have any further rights against or liability to the other under this Agreement. (e) Failure of Agency to Negotiate in Good Faith. In the event Agency has not continued to negotiate diligently and in good faith Developer shall give written notice thereof to Agency which shall then have ten (10) business days to commence negotiating in good faith. Following the receipt of such notice and the failure of Agency to thereafter commence negotiating in good faith within such ten (10) business days, this Agreement may be terminated by Developer. In the event of such termination by Developer, Agency shall return the Deposit, and any interest earned thereon, if applicable, and neither party shall have any further rights against or liability to the other under this Agreement. (f) Termination of ENA. Upon termination of this Agreement at the expiration of the Exclusive Negotiating Period (or such extension thereof) without a DDA being signed or submitted by Developer, Agency shall have the right to retain the Deposit (including any interest accrued thereon) to reimburse its legal expenses and incidental costs related to the carrying out of this Agreement and negotiating a DDA with Developer, and neither party shall have any further rights against or liability to the other under this Agreement. If a DDA is signed and submitted by Developer but is thereafter not approved by Agency, then the Deposit with interest, shall be returned to Developer, and neither party shall have any further rights against or liability to the other under this Agreement. If a DDA is timely signed and submitted by Developer and is thereafter approved by Agency, then the Deposit shall be applied toward any deposit required under the DDA. If a DDA has been executed by the parties, the DDA shall supersede this Agreement and thereafter govern the rights and obligations of the parties with respect to the development of,the Site. Section 7. Schedule of Performance. It is the intention of Agency and Developer that the redevelopment of the Site be completed in a timely and an expeditious manner. Accordingly, the DDA shall provide in reasonable detail the tasks to be completed by the Parties in the development process and the projected date of completion for each such task. Section 8. Environmental. Execution of a DDA by Agency shall be subject to compliance with the California Environmental Quality Act (California Public Resources Code § 2100 et seq. as amended: "CEQA"). Since the Activity constitutes undertakings pursuant to and in furtherance of the Redevelopment Plan for the Project Area, Section 21090 of CEQA and Section 15180 of the State CEQA Guidelines (Title 14, California Code of Regulations § 15000 et seq.) apply to the Activity. However, Agency will evaluate the proposed Activity in accordance with Section 15168 of the State CEQA Guidelines in order to determine if the Activity is within the scope of the previously certified pro gram environmental impact report ("EIR") prepared in connection with the City's adoption of the Redevelopment Plan or if the Activity requires any additional CEQA documentation to be prepared for any of the reasons 6 01095/0012!75191 O t specified in Section 15162 of the State CEQA Guidelines. Developer hereby agrees to provide all reasonable assistance to Agency necessary for Agency to carry out its obligations under CEQA but shall be under no obligation to incur any costs or expenses outside the scope of Developer's proposed Activity under this Agreement. Any and all costs outside the scope of the obligations under this Agreement will be identified as costs to each party under an executed DDA between Agency and Developer. Section 9. Nondiscrimination. Developer shall not discriminate against nor segregate any person, or group of persons on account of race, color, creed, religion, sex, marital status, national origin, ancestry, handicap or sexual preference, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Site in the formulation of the DDA or after its execution, nor shall Developer establish or permit any such practice or practices of discrimination or segregation in the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub-lessees or vendees of the land. The DDA shall contain all applicable statutory covenants. Section 10. Owner Participation Requirements. This Agreement and the obligations of the Parties set forth in this Agreement, are subject to the applicable Owner Participation rules and regulations established for the Project Area and it shall be Developer's obligation to become familiar with such requirements. Section 11. Governing Law. This Agreement and the legal relations between the parties hereto shall be governed by and construed and enforced in accordance with the laws of the State of California. Hence, for any action by either party shall be commenced in Los Angeles County. Section 12. No Other Agreement. This Agreement constitutes the entire agreement of the parties hereto with respect to the subject matter hereof and supersedes any and all prior agreements and understandings between the parties. There are no agreements or understandings between the parties and no representations by either party to the other as an inducement to enter into this Agreement, except as expressly set forth herein. Notwithstanding anything provided herein to the contrary, whether expressed or implied, Agency shall have no obligation to enter into a DDA with Developer and neither Agency nor its officers, members, staff or agents have made any promises to Developer other than to exclusively negotiate a DDA for the Site in good faith with Developer during the Exclusive Negotiating Period, and no statements of Agency or its officers, members, staff or agents as to future obligations shall be binding upon Agency unless and until a DDA has been approved by Agency and the City, and duly executed by the Executive Director of Agency or his designee. Section 13. Assignment. This Agreement shall not be assigned by Developer to any person or entity without the express written consent of Agency; provided, however, that Developer may assign the Agreement to a California business entity that is formed for the purpose of carrying out the Activity and for which Developer is a member and the manager thereof. Any assignment does not release Developer from any of its obligation hereunder. 7 0 1 095/00 1 2/7 5 1 9 1 Ol Section 18. Effect of Agreement. Notwithstanding any other provision of this Agreement to the contrary, the Parties expressly acknowledge and agree as follows: (a) except for those matters expressly set forth in Section 2 above, none of the matters described in this Agreement as a purported commitment or obligation of Agency with respect to the development of the Activity shall have any effect unless and only to the extent such matters are expressly set forth in a DDA or other subsequent written agreement duly authorized and approved by Agency and the City; (b) Agency and Developer shall promptly commence the good faith negotiation of a DDA upon execution of this Agreement; and (c) upon the execution of a DDA by the Parties, this Agreement shall be null and void and of no effect and shall be superseded by the terms and conditions of the DDA. Notwithstanding any other provision of this Agreement to the contrary, Developer acknowledges and expressly agrees as follows: (a) that this Agreement does not obligate Agency in any way to approve, in whole or in part, any of the matters described in this Agreement, including, (without limitation) matters pertaining to land use entitlements or approvals, permits, waivers or reduction of fees, development or financing of the Site or any other matters to be acted on by Agency, as applicable; (b) that all such matters shall be considered and processed by Agency in accordance with all otherwise applicable Agency and City requirements and procedures; and (c) that Agency reserves all rights to approve, disapprove or approve with conditions all such matters in their sole discretion. Developer acknowledges that and all expenditures made by it are not recoverable by Developer in the event that a subsequent Agreement is not approved. Developer further acknowledges and agrees that, during the negotiations, the Parties shall conduct such economic analyses and re-use studies as may be necessary to comply with the requirements of Section 33433 of the Redevelopment Law. [Signatures on Following Page] 9 01095/0012/75191.01 IN WITNESS WHEREOF, Agency and Developer have executed this Agreement in the City of Lynwood, Los Angeles County, California, on the date hereinabove first set out. "AGENCY" LYNWOOD REDEVELOPMENT AGENCY, a public body, corporate and politic By: ATTEST: By: Agency Counsel "DEVELOPER" FRESH & EASY NEIGHBORHOOD MARKET, INC., a Delaware corporation B y: 10 01095/0012/75191.01 EXHIBIT "A" DESCRIPTION OF THE SITE [On following page] Exhibit "A" 01095/0012/75191.01 EXHIBIT "B" DRAFT SITE PLAN AND ARCHITECTURAL RENDERINGS [On following page] Exhibit "B" 01095/0012/75191.01 AGENDA STAFF REPORT DATE: January 5, 2010 TO: Honorable Chair and Members of the Agency APPROVED BY: Roger L. Haley, Executive Director ~'' PREPARED BY: Sarah M. Withers, Director of Redey~lopment~-~ H. Ernie Nishii, Housing Manager SUBJECT: Acceptance of a Loan from the California Pollution Control Financing Authority to Assess the Alameda Triangle Site Recommendation: Staff recommends that the Lynwood Redevelopment Agency adopt the attached resolution entitled, "A RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY OF THE CITY OF LYNWOOD CALIFORNIA AUTHORIZING THE EXECUTIVE DIRECTOR TO ACCEPT ALOW-INTEREST, FORGIVABLE LOAN OF UP TO $500,000 FROM THE CALIFORNIA POLLUTION CONTROL FINANCING AUTHORITY". Background: In 2005 the Lynwood Redevelopment Agency (Agency) entered into a Disposition and Development Agreement with Casa Grande, LLC regarding a 12 acre site bounded by Fernwood Street, Alameda Street, and Imperial Highway to develop 120 single family homes. After a review of existing available environmental records and several meetings with the Department of Toxic Substance Control ("DTSC"), staff determined that additional remedial investigation and a detailed remedial action plan will be required by DTSC to prepare the site for development. On May 6, 2009 the Agency authorized staff to apply for a low interest loan from the Center for Creative Land Recycling (CCLR) for the amount of $500,000. On August 27, 2009, the Agency received a letter of approval fora loan. The California Pollution Control Financing Authority (Pollution Authority) is the originator of the loan and therefore, based upon the request by CCLR, the Agency will enter into the loan agreement with the pollution Authority. The material terms of the loan will remain the same. ITEM Discussion 8~ Analysis: Staff recommends that the Agency authorize the acceptance of a line of credit equal to the maximum loan amount of $500,000. Based on the circumstances governing the environmental investigation, staff may draw substantially less than the maximum loan amount. The Pollution Authority loan terms are for 36 months with an interest rate of either 2% or the six-month London Interbank Offered Rate (LIBOR), whichever is greater. The loan may be forgiven by the Pollution Authority if the Agency, acting reasonably and in good faith, fails to complete the project or proceed with the contemplated development. The loan also requires a 15% cash match and a 2% loan processing fee. The Agency has paid a portion of the initial loan processing fee. The chart below provides the cost estimate of the Pollution Authority Loan. Loan Processin Fee $10,000 Loan $500,000 Loan Interest 2% rate $10,000 Cash Match $75,000 Total Fiscal Im act $595,000 On October 7, 2009 the Agency sent letters to property owners in the Alameda Triangle Site area pursuant to the Polanco Act. The Polanco Act enables an Agency to request environmental data and a remedial action plan from the property owners within 60 days. If no remedial action plan is submitted within this time frame the Agency may enter upon the site, assess the property, and charge the property owners and/or the responsible parties for the assessment of the property. The Agency intends to charge the property owners and/or the responsible parties for the entire cost the Pollution Authority loan thereby eliminating any impact on the City's budget. Staff recommends the approval of the Pollution Authority loan for the assessment of the Alameda Triangle. Fiscal impact: The potential fiscal impact at the end of the 36 month term is estimated at $595,000 if funds are not recouped from the property owners and if the maximum loan amount is borrowed. If the property owners do not pay the assessment costs, then the Agency will take efforts to place a lien on the property. If the costs of the assessment are in excess of the property value, these costs would be paid for from Agency funds. In addition to acquiring the funds from the property owners and/or responsible parties, the Agency also intends to stagger the use of the loan to spread the cost over time. 2 Coordinated with Agency Counsel City Manager's Office RESOLUTION NO. A RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY OF THE CITY OF LYNWOOD CALIFORNIA AUTHORIZING THE EXECUTIVE DIRECTOR TO ACCEPT ALOW-INTEREST, FORGIVABLE LOAN OF UP TO $500,000 FROM THE CALIFORNIA POLLUTION CONTROL FINANCING AUTHORITY Whereas, the Lynwood Redevelopment Agency ("Agency") is engaged in activities necessary to carry out and implement the Redevelopment Plan for Project Area "A"; and Whereas, the twelve (12) acre site at the northeast corner of Fernwood Avenue and Imperial Highway is the subject of a Disposition Development Agreement between the Agency and Casa Grande, LLC; and Whereas, existing environmental data for the site indicates additional assessment work will be required before remediation and development will be permitted; and Whereas, the Center for Creative land Recycling (CCLR) provides low- interest, forgivable loans to assist community developers with environmental site assessment to determine project economics and quantify liabilities; and Whereas, the loan proceeds from the CCLR loan will pay for the required assessment in the area; and Whereas, the Agency has issued a letter pursuant to the Polanco Act requiring the property owners to propose a remedial action plan; and Whereas, The California Pollution Control Financing Authority originates all CCLR loans; and Whereas, CCLR has requested the Agency to work with and enter into the agreement for the assessment loan with the California Pollution Control Financing Authority; and NOW THEREFORE, THE LYNWOOD REDEVELOPMENT AGENCY OF THE CITY OF LYNWOOD, CALIFORNIA DOES HEREBY FIND, ORDER, AND RESOLVE AS FOLLOWS: Section 1: That the Agency authorizes the Executive Director or the Chair to execute the necessary loan acceptance documents including, but not limited to the attached loan agreement to, accept the California Pollution Financing Control Authority loan. Section 2: This resolution shall take effect immediately upon its adoption. PASSED, APPROVED and ADOPTED this 5th day of Jan 2010 Maria T. Santillan Chair ATTEST: Maria Quinonez Secretary Roger L. Haley Executive Director APPROVED AS TO FORM: Fred Galante Agency Counsel APPROVED AS TO CONTENT: Sarah M. Withers Director of Redevelopment 2