City of Culver City, California
City Council/Redevelopment Agency Joint Agenda Item Report
RECOMMENDATION:
Staff recommends both the City Council and the Culver City Redevelopment Agency
approve a Cooperation Agreement between the City of Culver City and the Culver
City Redevelopment Agency relating to the Owner Participation Agreement with Fox
Hills Mall, LP and CMF Fox Hills, LLC.
BACKGROUND:
In April 2008, the Agency approved an Owner Participation Agreement (the “OPA”)
with Fox Hills Mall, LP and CMF Fox Hills, LLC (collectively referred to as “the
Developer”) to renovate the Fox Hills Mall. The aim of the Developer and the
Agency is to renovate the mall to keep it competitive in today’s challenging
economy. Among the provisions of the OPA, the Developer is authorized to
construct three double-faced signs on the exterior of the mall which advertise goods
and tenants available within the mall. Pursuant to Section 5.4 of the OPA, the
Developer is to share the revenue generated by these signs with the Agency.
Section 33220 of the California Redevelopment Law (Health and Safety Code
Section 33000 et. seq.) allows Redevelopment Agencies to reimburse the local
jurisdiction (in this case, the City of Culver City) for the cost of providing aid and
Meeting Date: 05/18/2009 Item Number: J-2
AGENDA ITEM: JOINT ITEM - Approval of a Cooperation Agreement between the
City of Culver City and the Culver City Redevelopment Agency Relating to the
Owner Participation Agreement with Fox Hills Mall, LP and CMF Fox Hills, LLC
Contact Person/Dept.: John Fisanotti Phone Number: (310) 253-5767
Fiscal Impact: Yes [X] No [] General Fund: Yes [X] No []
Public Hearing: [] Action Item: [X] Attachments: [X]
Public Notification: Courtesy Notice via Master E-Mail Notification List (05/07/09), Master
E-Mail Notification List (05/13/09).
Department Approval:
Sol Blumenfeld (5/12/09)
City Attorney/Approval:
Carol Schwab (by H. Baker) (05/13/09)
Agency General Counsel Approval:
Murray Kane (05/13/09)
Chief Financial Officer Approval:
Jeff Muir (by N. Kimball) (05/13/09)
City Manager/Executive Director Approval:
Jerry B. Fulwood (05/13/09) City of Culver City, California
City Council/Redevelopment Agency Joint Agenda Item Report
assistance to implement the Redevelopment Plan. This represents a cost savings
and an efficiency of operation since an Agency does not have to duplicate services
and functions which are already provided by the local jurisdiction. Over the years,
the City of Culver City and the Agency have entered into various Cooperation
Agreements establishing payments from the Agency to the City for this purpose.
DISCUSSION:
As stated in the OPA:
“…the sharing of sign revenue (between the Developer and the Agency) is for
the purpose of allocating the cost of the redevelopment of the Developer
Parcel among public and private participants and is also in consideration for
the Agency’s obligation, subject to the terms and conditions hereof, to make
the Agency Assistance available to Developer...”
Through the proposed Cooperation Agreement, which is attached to this report as
Attachment No. 1, the revenue received by the Agency from the Developer pursuant
to the OPA, would in turn be paid to the City for as long as the revenue is received,
to offset current and future costs to the City in assisting the Agency in implementing
The Redevelopment Plan for the Culver City Redevelopment Project.
FISCAL ANALYSIS:
Pursuant to Section 5.4 of the OPA, the income stream from the Developer to the
Agency consists of a Base Payment and an Additional Payment derived from the
advertising revenue generated by the three exterior signs. The base payment is
$225,000.00 and the Additional Payment is 50% of all gross revenue above
$2,200,000.00. Payments are based upon the prior year’s revenue and are due to
the Agency on March 1 of each year commencing in the year after the signs go into
operation (with the first payment anticipated to be made in March 2010). Payments
continue until the signs no longer exist or are no longer in operation.
ATTACHMENTS:
1. Draft Cooperation Agreement
City of Culver City, California
City Council/Redevelopment Agency Joint Agenda Item Report
MOTION:
That the City Council:
1. Approve the Cooperation Agreement between the City of Culver City and the
Culver City Redevelopment Agency; and,
2. Authorize the City Attorney to review/prepare the necessary documents; and,
3. Authorize the City Manager to execute such documents on behalf of the City.
That the Redevelopment Agency:
1. Approve the Cooperation Agreement between the City of Culver City and the
Culver City Redevelopment Agency; and,
2. Authorize Agency General Counsel to review/prepare the necessary documents;
and,
3. Authorize the Executive Director to execute such documents on behalf of the
Agency.
MEETING DATE: 05/18/09
AGENDA ITEM: Approval of a Cooperation Agreement between the City of
Culver City and the Culver City Redevelopment Agency
ATTACHMENT
Pages
1. Cooperation Agreement 1-5COOPERATION AGREEMENT
THIS COOPERATION AGREEMENT (the "Agreement") is entered into this day of • 2009 (the "Effective Date"), by and between the CITY OF
CULVER CITY, a municipal corporation (the "City") and the CULVER CITY
REDEVELOPMENT AGENCY, a public body, corporate and politic (the "Agency"), with
reference to the following facts:
A. Redevelopment Plan for the Culver City Redevelopment Project:
1. Pursuant to Ordinance No. CS-712, adopted on July 26, 1971, the City
Council for the City of Culver City (the "City Council") adopted a final redevelopment plan
for the Slauson-Sepulveda Redevelopment Project, Project No. 1 ("Project Area No. 1 "); and
2. The redevelopment plan for Project Area No. I was amended by the
City Council pursuant to Ordinance Numbers CS-892 (adopted on June 6, 1977), 89-034
(adopted on December II, 1989, and 94-034 (adopted on December 27, 1994); and
3. Pursuant to Ordinance No. CS-729, adopted on December 28, 1971,
the City Council adopted a final redevelopment plan for the Overland-Jefferson
Redevelopment Project No. 2 ("Project Area No. 2"); and
4. The redevelopment plan for Project Area No. 2 was amended by the
City Council pursuant to Ordinance Number 94-035 (adopted on December 27, 1994); and
5. Pursuant to Ordinance No. CS-862, adopted on November 24, 1975,
the City Council adopted a final redevelopment plan for the Washington-Culver
Redevelopment Project No. 3 ("Project Area No. 3"); and
6. The redevelopment plan for Project Area No. 3 was amended by the
City Council pursuant to Ordinance Number 94-036 (adopted on December 27, 1994); and
7. Project Area No. 1, Project Area No. 2, and Project Area No. 3 were
merged into the Culver City Redevelopment Project (as Component Areas Nos. 1, 2, and 3,
respectively, of the "Project"), and the Redevelopment Plan for Culver City Redevelopment
Project (the "Redevelopment Plan") was adopted pursuant to Ordinance No. 98-014 (adopted
on November 23, 1998); and
8. Pursuant to Ordinance No. 98-015, adopted on November 23, 1998,
the City Council added Component Area No. 4 to the Project; and
9. The Redevelopment Plan was amended by the City Council pursuant
to Ordinance Number 2004-001 (adopted on January 12, 2004); and
IO. The Redevelopment Plan was amended by the City Council pursuant
to Ordinance Number 2005-006 (adopted on September 12, 2005); and
11. The Redevelopment Plan is incorporated herein by reference and made
part hereof as though fully set forth herein.
Page 1 of 5B. The Agency and the City wish to cooperate with one another to bring about
the redevelopment of the Project and accomplish various tasks set forth in the Redevelopment
Plan.
C. Pursuant to Section 33220 of the California Community Redevelopment Law
(Health & Safety Code, Section 33000 et seq.), for the purposes of aiding and cooperating in
the planning, undertaking, construction or operation of the redevelopment projects in the
Project, the City may, among other things, exercise the following powers: sell any of its
property to the Agency; cause public improvements to be furnished in connection with
redevelopment; plan or replan and zone or rezone any part of such area and make any legal
exceptions from building regulations and ordinances; and enter into agreements with the
Agency respecting action to be taken to any of the foregoing powers.
D. As outlined in Recital A above, the City has engaged in such redevelopment
activities pursuant to Section 33220 of the California Community Redevelopment Law
(Health & Safety Code, Section 33000 et seq.) that has aided and assisted in implementing
the Redevelopment Plan, and intends to engage in further redevelopment activities.
E. The Agency and the City Council now desire to enter into this Agreement to
provide for redevelopment activities within the Project, and to make payments by the Agency
to the City of certain costs related to such redevelopment activities, subject to all of the terms
and conditions of this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and
promises contained herein, the parties hereto agree as follows:
TERMS
1. INTRODUCTORY PROVISIONS
The Recitals above are an integral part of this Agreement and set forth the intentions
of the parties and the premises on which the parties have decided to enter into this
Agreement.
2. OBLIGATIONS
a. The City agrees to accept payments equal to that certain Sign Revenue
(defined below) by the Agency as consideration for such redevelopment activities that have
aided and assisted in the implementation of the Redevelopment Plan, and will further aid and
assist in the implementation of the Redevelopment Plan pursuant to Section 33220 of the
California Community Redevelopment Law (Health & Safety Code, Section 33000 et seq.).
b. The Agency agrees to make payments under this Section 2 solely from sign
revenue when and as received by the Agency under that certain Owner Participation
Agreement (the "OPA"), effective April 2008, by and between the Agency and Fox Hills
Mall, LP and CMF Fox Hills, LLC, as described in Section 5.4 therein (sometimes referred to
herein as the "Sign Revenue").
c. The Agency's obligation to pay consideration to the City under this Section 2
is sometimes referred to herein as the "Agency Obligation." The Agency Obligation shall
Page 2 of 5continue until the expiration of the sharing of said Sign Revenue in accordance with Section
5.4 of the OPA.
d. The obligation of the Agency to make payments to the City shall, without
necessity of further action by the Agency or City, be junior and subordinate to all other
obligations or indebtedness heretofore or hereafter voluntarily incurred by the Agency to the
extent, if any, that the Agency expressly provides to contrary effect in the instruments
creating such other obligations or indebtedness.
3. LIABILITY AND INDEMNIFICATION
In contemplation of the provisions of Section 895.2 of the California Government
Code imposing certain tort liability jointly upon public entities solely by reason of such
entities being parties to an agreement as defined by Section 895 of the California
Government Code, the parties hereto, as between themselves, pursuant to the authorization
contained in Sections 895.4 and 895.6 of the California Government Code, shall each assume
the full liability imposed upon it, or any of its officers, agents or employees, by law for injury
caused by negligent or wrongful acts or omissions occurring in the performance of this
Agreement to the same extent that such liability would be imposed in the absence of Section
895.2 of the California Government Code. To achieve the above-stated purpose, each party
indemnifies, defends and holds harmless the other party for any liability, losses, cost or
expenses that may be incurred by such other party solely by reason of Section 895.2 of the
California Government Code. The provisions of Section 2778 of the California Civil Code
are made a part hereof as if fully set forth herein.
4. MISCELLANEOUS PROVISIONS
a. Time of Essence. Time is expressly declared to be of the essence in this
Agreement and of every provision hereof in which time is an element.
b. Notices. Any notice to be given or other document to be delivered by any
party to the other or others hereunder, may be delivered in person to an officer of any party,
or may be deposited in the United States mail, duly certified or registered, return receipt
requested, with postage prepaid, or by Federal Express or other similar overnight delivery
service, or by facsimile machine if concurrently delivered by another permissible method set
forth in this Paragraph, and addressed to the party for whom intended, as follows:
City: City of Culver City
9770 Culver Boulevard
Culver City, CA 90232
Attention: City Manager
Telephone: (310) 253-6000
Agency: Culver City Redevelopment Agency
9770 Culver Boulevard
Culver City, CA 90232
Attention: Assistant Executive Director
Telephone: (310) 253-5760
Any notice that is personally delivered (including by means of professional messenger
Page 3 of 5service, courier service such as United Parcel Service or Federal Express, or by U.S. Postal
Service), shall be deemed received on the documented date of receipt; and any notice that is
sent by United States mail, duly certified and registered, with postage prepaid shall be
deemed received on the third day after mailing.
c. Binding Effect. This Agreement shall be binding on and inure to the benefit
of the parties to this Agreement and their respective heirs, personal representatives,
successors and assigns, except as otherwise provided in this Agreement.
d. Titles and Captions. Titles or captions contained herein are inserted as a
matter of convenience and for reference, and in no way define, limit, extend or describe the
scope of this Agreement or any provision hereof. All references to "Paragraph" shall mean
the Paragraphs of this Agreement unless otherwise specified.
e. Interpretation. No provision in this Agreement is to be interpreted for or
against either party because that party or his legal representatives drafted such provision.
f. Further Assurances. The parties agree to promptly execute such other
documents and take such other actions as may be reasonably necessary to further the
purposes of this Agreement.
g.
Severance. If any provision of this Agreement is determined by a court of
competent jurisdiction to be illegal, invalid or unenforceable, such provision shall be deemed
to be severed and deleted from the Agreement, and the severance and deletion shall not in
any way affect the validity of the remaining provisions of this Agreement.
h. Entire Agreement; Waivers and Amendments. This Agreement integrates all
of the terms and conditions mentioned herein or incidental hereto, and supersedes all
negotiations or previous agreements between the parties with respect to all or part of the
subject matter hereof. The terms of this Agreement are only for the benefit of the City and
the Agency, and there are no other intended or incidental third party beneficiaries hereto.
All waivers of any of the provisions of this Agreement must be mutually agreed upon
in writing and signed by the authorized representatives of the parties.
This Agreement may be amended any number of times upon the mutual approval of
the Agency and the City and must be in writing and signed by the authorized representatives
of the parties.
[Signatures begin on following page]
Page 4 of 5IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first set forth above.
Dated: CITY OF CULVER CITY
By
City Manager
Dated: CULVER CITY REDEVELOPMENT
AGENCY
By Michel O'Leary
Chairman
APPROVED AS TO FORM:
CITY ATTORNEY
Carol Schwab
City Attorney
KANE BALLMER BERKMAN
Murray 0. Kane
Agency General Counsel
Page 5 of 5