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Home My WebLink About1986-12-02; City Council; 8826; Hosp Grove Acquisition Negotiations.. z 0 6 a i 0 z 3 0 0 4B# Fr 176 IIITG. 12/02/86 IEPT. CM CITY OF CARLSBAD - AGEND BILL TITLE HOSP GROVE ACQUISITION NEGOTIATIONS DEPT. HD..= CITY AlTY vj363 CITY MGR&E RECOMMENDED ACTION: Consider options for Hosp Grove purchase and direct the City Attorney to prepare necessary documents and adjourn this meeting to December 4, 1986. ITEM EXPLANATION: At its November 11, 1986 Council meeting, the City Council directed that the Council committee on Hosp Grove, Council Members Lewis and Pettine, meet with the Hosp Grove property owner and developers to pursue the possible acquisition of Hosp Grove. A meeting was held on November 20, 1986. As a result, the property owner and developers have agreed to give the City another chance to acquire the Grove. A tentative agreement provides that the purchase price of the Grove will remain at $5.7 million. In addition, the developers, Odmark Development Company and Collins Development Company, will be reimbursed for their costs incurred in pursuing the development of the property. These costs estimated at $725,000, are being audited and verified by the City's auditor, Deloitt, Haskins and Sells. The final agreement has not been drafted. A letter of intent from the property owner and developer is being prepared outlining the terms for the acquisition and indicating their intention to enter into an agreement. The purchase will be financed by a revenue bond issue with debt service supported by the General Fund. In order to implement the agreement, the Council will need to take two actions, The first would be to call an election seeking majority voter approval for the purchase as required by Proposition H. The second action, depending on how the Council deals with the fiscal impacts, would be to call an election to approve a tax increase to augument General Fund revenues. If the Council approves, the election would be held on March 3, 1987, concurrent with the special Council election. FISCAL IMPACT: The fiscal impact of this agreement is estimated at $6.5 million. In addition to the $5.7 million to the property owners for the acquisition of the property, another $725,000 4 x Page 2 of Agenda Bill b816 will be paid to the developers to reimburse them for their costs. In addition, it is estimated that another $295,500 will be needed to pay the costs of bond issuance in order to finance the acquisition of the Grove. The Grove would be acquired through the issuance of debt known as certificates of participation. It is estimated that it would cost $633,000 a year in debt service for 20 year 6.5% bonds. The debt service obligation would be borne by the General Fund. If the Council wishes to pursue acquisition of the Grove from the General Fund, it is recommended that new revenue sources be created to increase General Fund revenues. Three alternative methods 1. 2. 3. are suggested to create additional General Fund revenues: Increase the existing Transient Occupancy Tax from 6% to 9%. This would raise approximately $600,000 annually. This would require a majority vote of the electorate. Increase Business Licenses on new construction from 2.5% to 2.75%. This would raise $12 million between now and buildout. This would also require a majority vote of the electorate. Issue General Obligation Bonds to acquire the property. This requires a 2/3 vote and bond repayment would come from increased property taxes. ARGUMENT AGAINST PROPOSITION A Proponents would have voters believe that. all trees would be that a total of 59 acres of the existing forest would remain at only a small cost to the City. lost unless the initiative is passed. They don't tell you IIO Voters should be aware of these facts: 13 The City of Carlsbad currently oms 27 acres of Hosp Grove. 21 Under an existing negotiated settlement with the owners, the City would acquire an additional 32.3 acres of 43 land through purchase and-dedications. &*O Qrlo~c~rWs - The &&%e price for the additional land would be $1975, OW. 00 ;>r $30,1~16.00 per acre, 31 - The current owners would be required to put in all necessary roads and storm drains. If this ballot measure is approved, the above negotiated agreement would be superseded by it, resulting in a significant financial impact on the City's general fund. The following facts describe the effects of the initiative: expenditure of 7 million dollars to purchase 52.68 acres of land, to interest payments over the next 20 years. - An overall cost of 13 million equates to ~246,777.00 per acre. 21 Additional street and storm drain expenditures will be required to be paid by City. 11 The ballot initiative requires a general fund aS - This would be increased to 13 million dollars due 42 CI There is grave concern over spending k&s large amounpof government support of vitally needed services. General fund money is used to support the operation of police and fire services, as well as parks, libraries and general government activities. money from the City's general fund, thereby risking Yb We believe that the negotiated settlement will provide for 39 the preservation of most of the Grove without causing a severe financial impact to Carlsbad. Help us save 59 acres of forest land at very little cost to the City. - VOTE NO ON PROPOSITION A! 3 The undersigne authors of the primary rgument against, ballot Proposition A at the Special Election for the City of Carlsbad to be held on March 3. 1’387 hereby states that such argiment is true and correct to the best of their knowledge an? belief. Signed Date The above listed names and titles are: Mary H. Casler Mayor, 1982-1986 Scott Wright Parks and Recreation Commissioner Glenn McComas Councilman, 1968-1975 David V. Castner President of Carlsbad Senior Citizens Association Mary M. Marcus Planning Commissioner A (ZpT P . ,WENT IN FAVOR OF PROPOSITION ------- . Hosp Grove is a magnificent eucalyptus forest just south of Buena Vista Lagoon and Plaza Camino Real. One of Carlsbad's most treasured and distinctive landmarks. the grove serves as a majestic gateway to the city and as a natural buffer between commercial development and residential neighborhoods. Hosp Grove is a woodland sanctuary for birds, small animals, and people who need to "get away from it all." On March 3rd. Carlsbad voters have the historic opportunity to preserve this beloved forest. A =vote -will approve the City's purchase of Hosp Grove- be doomed. Bulldozers will mow down thousands of trees and level a major hillside. Instead of open space, Carlsbad will get yet another condominiums. Though some wooded areas would remain, Carlsbad s last unbroken stretch of forest would be lost forever. when half a million people live on the North County coast and most of our open space is gone. If we s- it can become a great forest park, with hiking trails and picnic grobnds. Linked to the cean by paths along Buena Vista Lagoon, the forest will be a priceless open-space resource. The choice is ours: more stores and condos- or a great forest parkland. Ptoposition A is our last chance to acquire Hosp Grove. Now. before it s too late, let's vote to save this beautiful foresr for ourselves and our children. The undersigned authors of the primary argument in favor of ballot proposition A at the special municipal election for the City of Carlsbad to be held on March 3, 1987, hereby state that such areument is true and correct to the best of their bC 28- If Proposition A fails to win a majority vote, much of the forest will shopping center, yet another office complex. and over a hundred more Lo< Carlsbad needs the forest now. We'll need it even more in ten years, 1.9 4Y Kav khristiansen (Da te) CARLS BAD HI STORI CAL / PRESERVATION COMMISSION O.B. Adams (Date) COMMUNITY AWARENESS CO-FOUNDER, LA COSTA F IIOSP GROVE CITY COUNCIL MEMBER CITY OF CARLSBAD