09/01/2010 SP LE COPY
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�eRno TettR c $pecial"1V e'eting
September 1;2010
v .6-00 ptin,
22795 Barton Road
-Grand.Terrace —
California 92313-5295
Civie,Unter
(909)824-f¢21"
Fax(909).783-7629
Fax.(909)783-'2600 CITY- OF ,-GRAND _TERRACE-
Maryetta Ferre
Mayor,
,CRA/CITY• COUNCIL
Lee Ann Gareia `
Mayor Pro Tem REGULAR-MEETINGS'
- Bea Cortes r `
WaltStanckiewitz 2Nll.AND 4TH Tuesday '6:�00 pA d =
Council Members
Betsy M.Adams "
City Manager
Co,uneil Chambers '
Grand Terrace Civic Center
22795 Barton Road
Grand Terrace, CA,92313-5295 _
CITY OF GRAND TERRACE
SPECIAL COUNCIL MEETING
AGENDA
CITY COUNCIL CHAMBERS September 1,2010
GRAND TERRACE CIVIC CENTER 6:00 p.m.
22795 Barton Road
II
THE CITY OF GRAND TERRACE COMPLIES WITH THE AMERICANS WITH DISABILITIES ACT OF 1990. IF YOU
REQUIRE SPECIAL ASSISTANCE TO PARTICIPATE IN THIS MEETING,PLEASE CALL THE CITY CLERK'S OFFICE AT
(909)824-6621 AT LEAST 48 HOURS PRIOR TO THE MEETING.
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IF YOU DESIRE TO ADDRESS THE CITY COUNCIL DURING THE MEETING,PLEASE COMPLETE A REQUEST TO
SPEAK FORM AVAILABLE AT THE ENTRANCE AND PRESENT IT TO THE CITY CLERK. SPEAKERS WILL BE CALLED
UPON BY THE MAYOR AT THE APPROPRIATE TIME.
ANY DOCUMENTS PROVIDED TO A MAJORITY OF THE CITY COUNCIL REGARDING ANY ITEM ON THIS AGENDA
WILL BE MADE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK'S OFFICE AT CITY HALL LOCATED AT
22795 BARTON ROAD DURING NORMAL BUSINESS HOURS. IN ADDITION,SUCH DOCUMENTS WILL BE POSTED ON
THE CITY'S WEBSITE AT WWW.CITYOFGRANDTERRACE.ORG
* Call to Order-
* Invocation-
* Pledge of Allegiance-
* Roll Call-
STAFF COUNCIL
AGENDA ITEMS RECOMMENDATION ACTION
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CONVENE COMMUNITY REDEVELOPMENT AGENCY
1. Approval of an Economic Development Agreement Between the Approve
City,Agency and Stater Bros. Markets
ADJOURN COMMUNITY REDEVELOPMENT AGENCY
CONVENE CITY COUNCIL
1. Approval of an Economic Development Agreement Between the Approve
City,Agency and Stater Bros.Markets
2. PUBLIC COMMENT
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This is the opportunity for members of the public to commenton any
items not appearing on the regular agenda Because of restrictions
contained in California Law,the City C'ouhcil may not discuss or act
on any item not on the agenda,but may briefly respond to statements
made or ask a question for clarification 1) The Mayor may also
request a brief response from staff to questions raised during public
Lcomment or may request a matter be agendlzed for a future meeting. j
ADJOURN
THE NEXT CRA/CITY COUNCIL MEETI 4 G WILL BE HELD ON
TUESDAY, SEPTEMBER 14,2010 AT 6:00 P.M.
............................................................................................................................
AGENDA ITEM REQUESTS MUST BE SUBMITTED IN
WRITING TO THE CITY CLERK'S OFF14 NO LATER THAN 14
CALENDAR DAYS PRECEDING THE MEETING.
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' AGENDA REPORT
i.�LIFORAIA
MEETING DATE: September 1, 2010 Council Item (X ) CRA Item ( X )
SUBJECT: Approval of an Economic Development Agreement between the City,
Agency and Stater Bros. Markets
PRESENTED BY: Joyce Powers, Community and Economic Development Director
RECOMMENDATIONS: 1. That the City Council approve the attached Economic Development
Agreement between,the City, Agency and Stater Bros. Markets with any
approved modification(s).
2. That the Agency approve the attached Economic Development
Agreement between the City, Agency and Stater Bros. Markets with any
approved modification(s).
BACKGROUND:
On July 21, 2010, the City Council approved the Town Square Master Plan, and Development Unit#1,
which will be developed by Stater Bros. The Council and Agency also reviewed proposed criteria for
a Development Agreement with Jacobsen Family Holdings and an Economic Development Agreement
with Stater Bros.
The Development Agreement would include any development fee offsets and time extensions, which
would first be forwarded first to the Planning Commission to consider the extension of the
entitlements to five years. Staff is working with Jacobsen Holdings to complete the document.
As a result of the Agency's direction on July 27, 2010, the attached Economic Development
Agreement with Stater Bros. has been completed. ._ ._ _ - _ Y°= .-;._ _ 'i4
DISCUSSION:
Stater Bros. private investment is approximately $17.5 ,million for the market alone, which will
increase as Development Unit#1 is built out. The Economic Development Agreement is based on the
resulting benefits to .the community, which include job creation (both-construction and permanent
jobs), property and sales tax benefits, new products and services, and the potential to attract additional
businesses.
In addition, the project would achieve many of the stated goals of the Agency's Redevelopment Plan,
particularly:
1. Stimulating additional investment by the private sector.
2. Increasing the City's economic base and the number of temporary and permanent jobs.
CRA AGENDA ITEM NO. i
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3. Eliminating and preventing blight by developing underutilized property that has negatively
impacted the Project Area with a well-designed project.
4. Providing for the enhancement and renovation of existing bu,inesses to promote their
economic vitality.
The recommended economic incentives include .two programs, a jobs cov' nant and a public parking
facility. The new Stater Bros. will retain and create approximately 20 permanent full time jobs and 76
part-time jobs, or 77 full-time equivalent jobs (FTE), including the full-service pharmacy. The
covenant for job creation and retention (Section 2.3 of the Agreement) would guarantee these jobs for
a period of five years at an Agency cost of up to $192,500.00 per year, or 2,500.00 per new FTE job
each year. The fee for any year will be based on the actual number of FTE jobs, not to exceed
$962,500 over the five-year term. Construction of the market will also create approximately 140
construction jobs. At build-out, the entire project is expected to have created approximately 208
permanent jobs, from entry to professional levels.
For the first five years, excess parking will be available on site that is recommended to be used for 45
public parking spaces. The Agency and"City would be granted a parking easement to be used
primarily as a park and ride facility to reduce regional traffic congestion, particularly during upcoming
,I-215 construction. The Agency's cost of the parking easement would be $49,000.00 per year, or
$1,089.00 per space, per year. Section 3.2 of the Agreement provides for quarterly payments, which
would be effective after the Certificate of Occupancy is issued for the market.
New property taxes created by the Stater Bros. market alone are estimated to be $35,000.00 per year to
the General Fund and $70,000.00 to the Agency, based on a $17.5 million valuation of the new
construction. Sales tax revenue is projected to increase by 22% over the ourrent store's sales tax due
to the expanded products and services. As new structures in future phases are built, the revenue
would continue to increase. This project is also expected to attract additional commercial development
as other investors are encouraged by the activity.
The attached Agreement requires one modification, to Section 2.4, to add a five-year cap of$962,500,
and has been confirmed by Stater's Director of Real Estate in a letter attached as Attachment 2. Staff
recommends that the Agency approve the Agreement with this modification, and that the Chairperson
execute the Agreement after its completion and execution by Stater Bros.
FISCAL IMPACT:
The impact to the Agency would be approximately $241,500.00 annually for the first five years after
completion of the Stater Bros. store. A new budget allocation is not requested at this time, but the
allocation would be included in future Agency budgets. If funds are need d during the 2010-11 fiscal
year, staff will return to the Agency with a budget appropriation request. The Agency has
approximately $4.6 million available for new projects and programs.
Respectfully submitted,
Joyce Powers
Community and Economic Development Director
Manager Approval:
Betsy MAdamls
City Manager/Agency Executive Director
ATTACHMENTS:
1. Economic Development Agreement
2. Letter from Stater Bros.
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ATTACHMENT#I
ECONOMIC DEVELOPMENT AGREEMENT
ECONOMIC DEVELOPMENT AGREEMENT
by and among
THE CITY OF GRAND TERRACE,
a California municipal corporation
and
THE CITY OF GRAND TERRACE REDEVELOPMENT AGENCY,
a California public body,corporate and politic
and
STATER.BROS. MARKETS,
n a California corporation
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ECONOMIC DEVELOPMENT AGREEMENT
This Economic Development Agreement("Agreement") is entered into as of August_, 2010, by
and among the City of Grand Terrace, a California municipal corporation C'City"), the City of Grand
Terrace Redevelopment Agency, a California public body, corporate and politic ("Agency") and Stater
Bros. Markets, a California corporation C'Stater") with reference to the following recited fads (each, a
"Recital"):
RECITALS
A. The city council of the City("City Council")approved and adopted a redevelopment plan
("Redevelopment Plan") for the redevelopment project area known as the "Grand Terrace Community
Redevelopment Project Area'("Project Area").
B. The governing board of the Agency ("Governing Board") adopted an implementation
plan ("Implementation Plan") for the Redevelopment Plan and is engaged . activities necessary to
execute and implement the Redevelopment Plan pursuant to California Community Redevelopment Law
(California Health and Safety Code Section 33000 et seq.)('CRU).
C. Stater owns or will own a legal and/or equitable interest in certain real property located
within the jurisdictional boundaries of the Project Area and the City south of Barton Road between
Michigan Street and Canal Street, approximately one-half mile from Interstate 215 on the west, and
approximately 950 feet from the intersection of Barton Road and Mt. Vernon Avenue on the east("Stater
Property"). The Stater Property is further described in Exhibit "A" attached hereto and by reference
incorporated herein.
D. Stater intends to develop a new grocery supermarket ("Project") on the Stater Property
within a new commercial center known as the"Grand Terrace Town Square" a Project is depicted in
Exhibit"B" attached hereto and by reference incorporated herein.
E. As part of the Project, Stater intends to grant the City a non-excl sive easement to utilize
parking areas within the Stater Property.
F. The development of the Project on the Stater Property is consistent with the objectives of
the Redevelopment Plan, Implementation Plan, the City's general plan ("General Plan") and the Barton
Road Specific Plan("Specific Plan"). _Tr
G. The development of the Project on the Stater Property will result in numerous public
benefits to the City,the Agency and the community, including,without limitations
i. Fulfilling long-term economic and social goals for the Cty, the Agency and the
community,
ii. Providing fiscal benefits to City's general fund in terns of increased sales tax
and property tax revenues:
iii. Providing fiscal benefits to the A,gency's general fund in terms of increased
property tax revenues,
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iv. Providing both short-term construction employment and long-term permanent
employment within City,
V. Financing and constructing significant public infrastructure improvements that
will serve the City and the region with the hope that the investment of'significant
private funds will stimulate economic growth in the City and the region;
vi. Phasing the construction of public infrastructure improvements with private
development;
vii. Creating an architectural image that builds upon City's unique history and
establishes a distinguishable community identity within City,
viii. Creating an identifiable sense of place within City,
ix. Establishing .a well balanced and carefully planned collection of general and
specialized retail uses that take full advantage of visibility and accessibility,
X. Providing day-time and night-time shopping and retail opportunities in a safe and
secure environment; and
xi. Providing increased public parking opportunities to better serve the public
parking needs of the City, Agency and the community.
H. In order for Project to be economically viable, Stater must close the operation of one of
its existing grocery supermarkets located in the City at 22441 Barton Road; Grand Terrace, California
("Existing Store").
I. The City and the Agency have requested that Stater delay the scheduled closing of the
Existing Store and operate the Existing Store,while Stater develops the Project, in accordance with the
terns and conditions of this Agreement, because such closing delay and continued operation of the
Existing Store will be of substantial economic benefit to the City and Agency, including, without
limitation:
1. Generating sales tax revenues that will assist the City in funding vital public
services for the residents and businesses within the City,
ii. Providing significant°employriient opportunities within the City,
iii. Providing needed day-time and night-time grocery supermarket shopping
opportunities within the City, and
iv. Fulfilling long-term economic and social goals for the City, the Agency and the
community.
J Delaying the close of the Existing Store, operating the Existing Store while Stater
develops the Project, developing the Project on the Stater Property, and granting to the City and(or
.Agency a non-exclusive easement in, over and through the Stater Property for public parking purposes
wdl provide significant economic benefits to the City, the Agency and the community. the City and
-kgency have concluded that the economic interests of the City's citizens and the public health, safety and
welfare will be best served by entering into this:agreement.
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OPERATIVE PROVISIONS
NOW, THEREFORE, IN VIEW OF THE GOALS AND OBJECTIVES OF THE CITY, THE
AGENCY AND STATER SET FORTH IN THIS AGREEMENT, THE CITY, THE AGENCY AND
STATER AGREE, AS FOLLOWS:
1. Definitions. Unless the context otherwise requires, the terms defined in this Section 1 shall, for
all purposes of this Agreement, and of any opinion or report or other document mentioned in this
Agreement,have the meanings defined in this Section 1. The following definitions are equally applicable
to both the singular and plural forms of any of the terms defined in this Section 1.
1.1 "Agency" shall mean the City of Grand Terrace Redevelopment Agency, a California
public body, corporate and politic, exercising governmental functions and po, ers and organized and
existing pursuant to CRL and shall include any nominee, assignee or successor to the Agency's rights,
powers and responsibilities.
1.2 "Agreement" shall mean this Economic Development Agreement.
1.3 "City' shall mean the City of Grand Terrace,a California municipal corporation and shall
include any nominee,assignee or successor to the City's rights,powers and responsibilities.
1.4 "City Council" shall mean the duly elected city council of the Cit�.
1.5 "CLIV shall mean California Community Redevelopment Law (California Health and
Safety Code Section 33000,et seq.).
1.6 "County' shall mean the County of San Bernardino, California.
1.7 "Costs'shall have the meaning set forth in Section 6.17.
1.8 "Dispute Notice' shall have the meaning set forth in Section 6.18.
1.9 "Economic Development Covenants' shall mean the economic development covenants of
Stater set forth in Section 2 of this Agreement.
` `-Economic Development Covenants Payment" shall mean the payment of money=from-
the City�andlor-�Agency to-Stater for Stater's performance of the Economic De�elopmen Covenants;as
set forth in Section 2 of this Agreement.
1.11 "Effective Date' shall mean the first date on which all of the following are true: (i) this
Agreement has been approved by the City Council following all legally required notices and hearings. (ii)
this Agreement has been approved by the Agency Governing Board following all legally required notices
and hearings and (iii) this Agreement has been executed by the appropriate,authorities of the City,
Agency and Stater.
1.12 "Enforced Delays'shall have the meaning set forth in Section 6. 0.
1 13 Event of Default' shall have the meaning set forth-in Section 4 1.
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1.14 "Exhibits" shall mean the following documents that are attached to, and by this reference
made a part of,this Agreement:
Exhibit A - Legal Description of Stater Property
Exhibit B -Project Description
Exhibit C -Depiction of Parking Easement Area
Exhibit D -Form of Parking Easement
1.15 "Existing Store" shall mean the existing grocery supermarket operated by Stater located
in the City at 22441 Barton Road, Grand Terrace, California.
1.16 "Fiscal Year" shall mean mean each fiscal year of Stater beginning on October 1 of each
calendar year and ending on September 30 of the following calendar year that occurs.during the Tenn,
with the first Fiscal Year during the Term sometimes being referred to as "Fiscal Year 1" and each
succeeding Fiscal Year thereafter being consecutively numbered, concluding with"Fiscal Year 10."
1.17 "General Plan" shall mean that certain general plan approved and adopted by the City
Council of the City on Apri127,2010 by Resolution No. 2010-10.
1.18 "Governing Board"shall mean the governing board of the Agency.
1.19 "Implementation Plan" shall mean that certain implementation plan pertaining to the
2010-2014 Implementation Plan originally approved and adopted by the Agency Governing Board on
December 8,2009,by Resolution No. CRA-09-11.
1.20 "Parties" shall mean,collectively,Stater,the City and the Agency.
1.21 "Party" shall mean, individually,Stater,the City or the Agency as applicable, and
1.22 "Project" shall mean the development of a grocery supermarket project on the Stater
Property as further described in Exhibit B attached hereto and by this reference made a pert hereof.
1.23 "Public Parking Easement' shall mean the ingress, egress and public parking easement
over the Public Parking Easement Area to be granted from Stater to the City and Agency.
1.24 "Public Parking Easement Area" shall mean the easement-area for ingress, egress and
public parking depicted in Exhibit C attached hereto andby this reference made a part hereof.
1.25 `Public Parking Easement Purchase Price" shall mean the amount of One Hundred
Dollars(S49,005.00)per year for a minimum of five(5)years,unless earlier terminated by Stater,paid by
the City and Agency to Stater for the Public Parking Easement as further described in Section 3.2.
1.25 "Redevelopment Plan" shall mean that certain "Amended and Restated Redevelopment
Plan for the Grand Terrace Community Redevelopment Project" originally approved and adopted by the
City Council of the City on September 27, 1979 by Ordinance No. 25, as amended prior to the-Effective
Date of this Agreement by the City's adoption of Ordinance No. 31 on March 20, 1980, Ordinance No. 52
on hily 15, 1981, Ordinance No. 187 on July 22, 1999. Ordinance No. 202 on September 12, 2002 and
ordinance No. 212 on July 22,2004.
1.26 "Redevelopment Project Area' shall mean that certain .geographic area specified in and
-4ibject to the requirements of the Redevelopment Plan.
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1.27 "Resolution Period' shall have the meaning ascribed to.the term in Section 6.18.2.
1.28 "Specific Plan' shall mean that certain "Barton Road Specific Plan" approved and
adopted by the City Council of the City on September 11, 2003 by Ordinance 208.
1.29 "Stater" shall mean Stater Bros. Markets, a California corporation, and shall include any
affiliate or subsidiary of Stater and any permitted nominee, assignee or successor to Stater's rights,
powers,obligations and responsibilities under this Agreement.
1.30 "Stater Property' shall mean that certain real property located within the jurisdictional
boundaries of the Project Area and the City south of Barton Road between Mi higan Street and Canal
Street, approximately one-half mile from the Riverside Freeway (Interstate 215), on the west, and
approximately 1,250 feet from the intersection of Barton Road and Mt. Vernon Avenue on the east, as
further described in Exhibit A attached hereto and by reference incorporated herein.
1.31 "-Tax Increment Revenues" shall mean those certain tax increment revenues available to
the Agency that are net of(i) payments required pursuant to the Redevelopment Plan to be distributed by
the County auditor-controller in accordance with the requirements of the Redevelopment Plan, 0i)
payments to be made to taxing entities pursuant to all pass-through agreements and any other fiscal
impact agreements with taxing entities, (iii) all statutory pass-through payments or reimbursement
payments whether to the State or to any other governmental entity, including the County, municipalities
and school districts, and(iv)such deposits as may he made annually to the Agency's housing fund.
1.32 "Term' shall mean the five (5) year time period commencing on the first Fiscal Year
following the issuance of a certificate of occupancy for the Project until the fi (P) anniversary of the
issuance of a certificate of occupancy for the Project.
2. Economic Development. The Economic Development Covenants and benefits to be received by
the City and Agency from the Economic Development Covenants are in the best interests of the City and
the Agency and the health, safety, morals and welfare of the City's taxpayers and residents and are in
accordance with public purposes set forth in federal, state and local law and regulation. Implementation
of the Economic Development Covenants will further the goals and objectives of the Redevelopment
Plan, Implementation Plan, General Plan and Specific Plan and will be of substantial economic benefit to
the City and Agency, including,without limitation:
- xii._ Fulfilling long-term,economic and;social oals_for„ttie;Cit the-: ere, and the: =t:
community; _
xiii. Providing fiscal benefits to City's general fund in terms of increased sales tax
and property tax revenues;
Kiv. Providing fiscal benefits to the Agency's general fund in terms of increased
property tax revenues;
xv. Providing both short-term construction employment and long-term permanent
employment within City,
Xvi. Financing and constructing significant public infrastru tore improvements that
will serve the City and the region;
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xvii. Phasing the construction of public infrastructure improvements with private
development;
xviii. Creating an architectural image that builds upon City's unique history and
establishes a distinguishable community identity within City,
xix. Creating an identifiable sense of place within City,
xx. Establishing a well balanced and carefully planned collection of general and
specialized retail uses that take full advantage of visibility and accessibility,
xxi. Providing day-time and night-time shopping and retail opportunities in a safe and
secure environment; and
xxii. Providing increased public parking opportunities to better serve the public
parking needs of the City, Agency and the community.
In consideration of the significant benefits to the community that the Economic Development Covenants
represent,the City and Agency have agreed to enter into this Agreement.
2.1 Economic Development Covenants Concerning the Stater Property and the Project.
Stater covenants and agrees that the Stater Property shall be put to no use other than those uses authorized
by the Redevelopment Plan, Implementation Plan,, General Plan,-Specific Plan and the City's zoning
ordinances, as-the same may be lawfully amended from time to time. Stater agrees, from the date a
certificate of occupancy is issued for the Project until the fifth Wh)anniversary of the date a certificate of
occupancy is issued for the Project, to continuously occupy; use and operate the Project as a grocer
supermarket and related incidental uses. Notwithstanding the foregoing, (i) nothing in this Section 2.1
shall limit, expand, modify, or otherwise affect any right of Stater to continue any legal non-conforming
use following changes in the Redevelopment Plan,Implementation Plan, General Plan, Specific Plan and
the City's zoning ordinances and(ii) nothing in this Section 2.1 shall limit Stater's rights to object to or
challenge any change to the Redevelopment Plan, Implementation Plan, General Plan, Specific Plan and
the City's zoning ordinances that may be enacted or approved after the Effective Date on any ground
including without limitation that said change is invalid on its face or as applied to Stater or the Stater
Property or a portion thereof. The foregoing covenants shall run with�the land.
2.2 Economic Development Covenants Concerning the Existing Store. The City recognizes
that Stater could have closed the Existing 4Store:and tt ansferred substantially all of its business to nearby
Mores. At the request of the City„Stater'continued to`aperate.tle Existing Stare 4despife`iri[entioris to close"` -
the Existing Store and despite the landlord's demand'that Stater pay above-market rents to preserve the
lease at the Existing Store location since July 1, 2008. Stater covenants and agrees to use its
commercially reasonable efforts to continue to operate the.Existing Store as a grocery supermarket and
related incidental uses until the date a certificate of occupancy is issued for the Project or April 30, 2012,
whichever is earlier. ,
2 3 ' Economic Development Covenants Regarding-Job Retention and Creation. The City
recognizes that Stater could have closed the Existing Store and transferred substantially all of its business
to nearby stores. By agreeing to continue operating the Existing Store,.Stater saved 73 jobs in the City,
including 17 full time jobs. Stater covenants that it will continue operating the Existing Store as a grocery
supermarket and related incidental uses in accordance with Section 2 , thereby preserving approximately
17 full time jobs and 56 part time jobs in the City. The city also acknowledges that Stater will create
approximately 1 to additional construction jobs during the development and construction of the grocery
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supermarket. By developing the Project and operating a grocery-supermarket in accordance with Section
2.1 above, Stater covenants and agrees to retain and create 20 ermanent full time jobs and 76 part-time
jobs, or 77 full-time equivalent jobs ("FTE") until the fifth (5 ) anniversary of the date a certificate of
occupancy is issued for the Project("Economic Development Covenant").
2.4 _Economic -Development Covenants Payment. In exchange for the Economic
Development Covenant, the City shall pay-approximately $192,500.00 per year for five (5) years, or
$2,500.00 per FTE job each year, which would be confirmed annually ("Covenant Payment"). The
Covenant Payment shall be paid quarterly on March 31, June 30, September 30 and December 31,
respectively, in the amount of$48,125.00 per quarter upon invoice and confirming the number of FTEs.
3. Public Parking. The City, Agency and Stater acknowledge and agree that there is a current
shortage of available public parking within that portion of the Project Area and City surrounding the
Project.The provisions of this Agreement concerning the Public Parking Easement and the benefits to be
received by the City and Agency from the Public Parking Easement are in the best interests of the City
and the Agency and the health,safety,morals and welfare of the City's taxpayers and residents and are in
accordance with public purposes set forth in federal, state and local law and regulation. Implementation
of provisions in this Agreement concerning the Public Parking Easement will further the goals and
objectives of the Redevelopment Plan,Implementation Plan,General Plan and Specific Plan.
3.1 Public Parking Easement. Within ten (10) days after approval of the certificate of
occupancy for the Project, Stater shall grant to the City and the Agency a non-exclusive public parking
easement over the Public Parking Easement Area for the limited purpose of public parking, including all
rights of ingress and egress. The Public Parking Easement shall be conveyed from Stater to the City and
the Agency by a deed in a fdrm reasonably acceptable to Stater,the City and the Agency. Neither the City
nor the Agency shall use the Public Parking Easement for any other purpose but for the purposes set forth
herein,unless the City and the Agency provide Stater with thirty(30)days prior written notice and Stater
consents thereto in writing. The Public Parking Easement shall become- effective on the date of
recordation of the deed granting the Public Parking Easement and shall expire five (5) years thereafter.
Upon the expiration of the Public Parking Easement term, the Public Parking Easement shall
automatically terminate without further action by the Parties hereto, but any Party shall, promptly after
receiving a written request therefor, execute and deliver a termination agreement in recordable form and
otherwise reasonably satisfactory to all Parties. Neither the City nor the Agency shall have the right to
assign, transfer, anblease or encumber (or otherwise transfer) the Public Parking Easement or assign, in
any manner,their rights concerning the Public Parking Easement under this Agreement. This Agreement
is not intended to grant a fee interest in the Public Parking Easement Area,.nor is it intended to be a lease
or"license. The foregoing_notwithstanding, Stater may from time to, tiniclo -accommodate. its business
eeds;
n relocate; the Public-Parking Easement Area to other portions of the'IStater Property. Such
relocation shall be subject to the prior written approval of the City and the Agency, which approval shall
not be unreasonably withheld or delayed. Such relocation shall conform to all applicable laws and
regulations governing the Project and the conduct of business thereon.
3.2 Public Parking Easement Purchase Price. The City and Agen shall pay to Stater the
Public Parking Easement Purchase Price quarterly on April 1, July 1, October 1 and December 31.
respectively of each year during the five(5)year term, in the amount of$12,251.Z5 per quarter.
4 Event ufDefault; Remedies, Termuinatitm.
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4.1 _Event of Default. Each of the following shall constitute an"Event of Default:"
4.1.1 Failure by a Party to comply with and observe any of the conditions, terms, or
covenants set forth in this Agreement, if such failure remains uncured thirty(30)days after written notice
of such failure from the non-defaulting Party to the defaulting Party with respect to a default that cannot
be cured within thirty (30) days, if the-defaulting Party fails to commence such cure within such thirty
(30) day period or, thereafter, fails to diligently and continuously proceed with such cure to completion.
However, if a different period, notice requirement, or remedy is specified under any other section of this
Agreement,then the specific provision shall control.
4.1.2 Any representation or warranty contained in this Agreement or in any
application,financial statement invoice, certificate, or report submitted pursuant to this Agreement proves
to have been incorrect in any material respect when made.
4.2 Remedies. In general, the City, Agency and Stater may pursue any remedy at law or
equity available for the breach of any provision of this Agreement, including consequential damages.
4.3 Stater Right To Terminate. Prior to the payment of any portion of the Economic
Development Covenant Payment by the City or the Agency to Stater, Stater shall have the right to
terminate this Agreement for convenience upon ninety(90) days prior written notice.
-1.4 Rights and Remedies Not Exclusive. Unless prohibited by law or otherwise provided by
a specific tern of this Agreement, the rights and remedies-of the Parties under this Agreement are
nonexclusive" and ail remedies under this Agreement may be exercised individually or cumulatively.
Upon any Party's Event of Default, in addition to those remedies expressly granted in this Agreement,the
Parties shall also have the right to seek all other available legal and equitable remedies, including,without
implied limitation,general and consequential damages.
4.5 Jurisdiction and Venue. The Parties each acknowledge and agree that this Agreement is
entered into in, is to be fully performed in and relates to real property located in the City and the County
in the State of California.
5. Mortgage Protection. The Parties hereto agree that this Agreement shall not prevent or limit
Stater, in any manner, at Stater's sole discretion, from encumbering the Stater Property or any portion
thereof or any improvement thereon by any mortgage, deed of trust or other security device securing
financing with respect to the Stater Troperty. The City and the Agency acknowledge that the lenders_ r
providirig-such-•financing`maCy. quire.certain'Agreement'interpretations'arid`iriodifications`°and agrees"
upon request, from time to time, to.=meet with Stater and representatives of such lenders to negotiate in i
good faith any such request for interpretation or modification. The City and the Agency will not
unreasonably withhold their consent to any such requested interpretation or modification provided such
interpretation or modification is consistent with the intent and-purposes of this Agreement and provided
further that no term, condition or covenant of this Agreement is made subordinate to the rights or interests
of such lenders.
5 1 Mortgagees. Any mortgagee of the Stater Property shall be entitled to the following
rights and privileges:
5 1 1 Neither entering into this Agreement nor a breach of this :1reement shall defeat,
render invalid, diminish or impair the lien of any mortgage on the Stater Property made in good faith and
for value. unless otherwise required by law
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5.1.2 The mortgagee of any mortgage or deed of trust encumbering the Stater Property,
or any part thereof,which mortgagee, has submitted a request in writing to the City and the Agency in the
manner specified herein for giving notices, shall be entitled to receive written notification from the City
and the Agency of any default by Stater in the performance of Stater's obligations under this Agreement.
5.1.3 If the City or the Agency timely receives a request from mortgagee requesting a
copy of any notice of default given to:Stater under the terms of this Agreement,the City or the Agency, as
the case may be, shall provide a copy of that notice to the mortgagee within ten (10) days of sending the
notice of default to Stater. The mortgagee shall have the right, but not the obligation, to cure the default
during the remaining cure period allowed such party under this Agreement.
5.1.4 Any mortgagee who comes into possession of the Stater Property, or any part
thereof,pursuant to foreclosure of the mortgage or deed of trust, or deed in lieu of such foreclosure, shall
take the Property, or part thereof,subject to the terns of this Agreement.
5.2 Estoppel Certificates. The City and Agency shall execute, aclmowledge and deliver to
Stater and/or to any mortgagee, promptly upon request,its certificate certifying: (i) that this Agreement is
unmodified and in full force and effect(or, if there have been modifications,that this Agreement is in full
force and effect, as modified, and stating the modifications), (ii) whether there are then existing any
charges or defenses against the enforcement by the Agency of any agreemen I covenant or condition
hereof on the part of Stater to be performed or observed(and,if so, specifying thesame), and(iii)whether
there are then existing any defaults by Stater in the performance or observance by Stater of any
agreement, covenant or condition hereof on the part of Stater to be performed or observed and whether
any notice has been given to Stater of any default which has not been cured (and, if so, specifying the
same). Any such certificate may be relied upon by a mortgagee or trustee under a deed of trust of the
Stater Property or any part thereof.
6. Miscellaneous Provisions.
6.1 Notices, Demands, and Communications Between and Among the Parties. Any and all
notices, demands, or communications submitted by any Party to any other Party or Parties pursuant to or
as required by this Agreement shall in,writing and shall be delivered in person, by a nationally recognized
overnight delivery service, or by registered or certified United States Mail,postage prepaid,return receipt
requested,to the principal office of the Party, as designated in this Section 6.1.
To Stater: Stater Bros. Markets:
.s. ... - _..—...;.. Sr..` .,. - ,ter`„_ ';t' - •. ...:.r• �:_;.:,_ii
_. 30'1''South'Tippecarioe"#venue "
San Bernardino, CA 92408
Attention: Michael Slaton, Senior Director—Real Estate
909.733.5002 (Phone)
909.733.4002 (Facsimile)
With a copy to: Varner&Brandt LLP
3750 University Avenue,Suite 610
Riverside, CA 92501
Attention: Sean S. Varner, Esq.
951.27.4 7777(Phone)
951.274.7770(Facsimile)
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To City: City of Grand Terrace
1.2795 Barton Road
Grand Terrace, CA 92313 '
Attention: Betsy M. Adams, City Manager
909.430.2245 (Phone)
909.783.7629(Facsimile)
With a copy to: City Attorney
22795 Barton Road
Grand Terrace, CA 92313
909.430.2245(Phone)
909.783.7629(Facsimile)
To Agency: City of Grand Terrace Redevelopment Agency
22795 Barton Road
Grand Terrace,CA 92313
Attention: Joyce Powers, Community&Economic Development Director
909.430.2247(Phone)
909.783.2600-(Facsimile)
With a copy to: Agency Attorney
22795'Barton Road `
Grand Terrace,CA 92313
909.430.2245 (Phone)
909.783.7629(Facsimile)
62 Entire Agreement. This Agreement sets forth and contains the entire understanding and
agreement of-the Parties, and there are no oral or written representations, understandings Or.' ciliary
<r_ ..covenants, undertakings:-nr=;agreementsY that�are,not -contained"or expressly referred to heat r . No
testimony or evidence of any�s<rch`ftpresentations,understandings or covenants shall be adnvssible`fi any--
proceeding of any kind or nature to interpret or determine the terms or conditions of this Agreement.
6.3 Severability. If any term, provision, covenant or condition of this Agreement shall be
determined invalid void or unenforceable, the remainder of this Agreement shall not be affected thereby
to the extent such remaining provisions are not rendered impractical to perform taking into consideration
the purposes of this Agreement.
6.4 Interpretation and Governing.Law. This Agreement and any dispute arising hereunder
shall be governed and interpreted in accordance with the procedural and substantive laws of the State of
California, without regard for conflict of laws principles. This Agreement shall be construed as a whole
according to its fair language and common meaning to achieve the objectives and purposes of the Parties
hereto. and the rule of construction to the effect that ambiguities are to be resolved against the drafting
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Party shall not be employed in interpreting this Agreement, all Parties having been represented by counsel
in the negotiation and preparation hereof.
6.5 Section Headings. All section headings and subheadings are inserted for convenience
only and shall not affect any construction or interpretation of this Agreement.
6.6 Singular and Plural. As used herein,the singular of any word includes the plural.
6.7 Incorporation of Recitals. The Recitals set forth in this Agreement are incorporated into
this Agreement..
6.8 Waiver. Failure by a Party to insist upon the strict performance of any of the provisions
of this Agreement by the other Party, or the failure by a Party to exercise its rights upon the default of the
other Party, shall not constitute a waiver of such Party's right to insist and demand strict compliance by
the other Party with the terns of this Agreement thereafter.
6.9 No Third Party Beneficiaries. This Agreement is made and entered into fo 'the sole
protection and benefit of the Parties and their successors and assigns. No other person shall have any
right of action based upon any provision of this Agreement.
6.10 Enforced Delay. Time is of the essence in the performance of the bligations of the City,
the Agency and Stater under this Agreement. In addition to specific provisions of this Agreement,
providing for extensions of time, times for performance under this Agreement shall be extended where
delays in performance are due to war, terrorism, insurrection; any form of labor d spute; lockouts riots;
floods; earthquakes; fires acts of God or of third parties; third party litigation or orders and judgments of
courts of competent jurisdiction; acts of a public enemy, acts of governmental authorities; epidemics;
quarantine restrictions and freight embargoes(collectively,"Enforced Delays"); provided, however, that
the Party claiming,the extension notify the other Party of the nature of the matter causing the default; and,
provided further, that the extension of time shall be only for the period of the Enforced Delay. In no
event stall any Party be deemed to be,in default under this Agreement because of an Enforced Delay.
6.11 Mutual Covenants. The covenants contained herein are mutual covenants and also
constitute conditions to the concurrent or subsequent performance by the Party benefited thereby of the
covenants to be performed hereunder by such benefited Party.
6.12 Successors in Interest. .-The_burdens of this Agreement shall be binding upon, and the
_ .
benefits:of,--this Agreement shall inure to;alTysuccessors-in.interest to:the Parties-to tfiiisiAgreement: ,-. ----
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6.13 Execution to Counterparts.'-Each person executing this Agreement,on behalf of the City,
the Agency and Stater warrants and represents that he or she each has the authority to execute this
Agreement on behalf of his or her municipal corporation, public body, corporation, partnership or
business entity and warrants and represents that he or she has the authority to bind his or her municipal
corporation,public body,' corporation, partnership or business entity to the performance of its obligations
hereunder. This Agreement may be executed in-three (3) or more counterparts, each of which wall be
deemed an original,and all of which shall constitute but one(1) and the same instrument.
6.14 Obligations of the City and the Agency are Separate and Distinct. The City's obligations
and the agency's obligations under this Agreement are separate and distinct.
6.15 Project as a Private Undertaking. 1t is pecfically understood and greed by and between
the Parties hereto that the development of the Project is a private development, that neither Party is acting
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as the agent of the other in any respect hereunder, and that each Party is an independent contracting entity
with respect to the terms, covenants and conditions contained in this Agreement. No partnership,joint
venture or other association of any kind is formed by this Agreement.
6.16 Further Actions and Instruments. Each of the Parties shall cooperate with. and provide
reasonable assistance to the other to the extent contemplated hereunder in the performance of all
obligations under this Agreement and the satisfaction of the conditions of this Agreement. Upon the
request of either Party at any time, the other Party shall promptly execute, with acknowledgment or
affidavit if reasonably required, and file or record such required instruments and writings and take any
actions as may be reasonably necessary under the terms of this Agreement to carry out the intent and to
fulfill the provisions of this Agreement or to evidence or consummate the transactions contemplated by
this Agreement.
6.17 Attorn s' Fees. In the event of the bringing of an arbitration, action or suit by a Party
against another Party by reason of any breach of any of the covenants or agreements or any intentional
inaccuracies in any of the representations and warranties on the part of the other Party arising out of this
Agreement or any other dispute between the Parties concerning this Agreement then, in that event, the
prevailing Party in such action or dispute,whether by final judgment or arbitration award,shall be entitled
to have and recover of and from the other Party all costs and expenses of suit or claim, including
reasonable attorneys' fees and expert witness fees. Any judgment, order or award entered in any final
judgment or award shall contain a specific provision providing for the recovery of all costs and expenses
of suit or claim, including reasonable attorneys' fees and expect witness fees (collectively, "Costs'')
incurred in enforcing,perfecting and executing such judgment or award. For the purposes of this Section
6.17, Costs shall include, without implied limitation, attorneys' and experts' fees, costs and expenses
incurred in the following: (i) post judgment motions and appeals, (ii) contempt proceedings, (iii)
garnishment, levy and debtor and third Party examination; (iv) discovery, and(v) bankruptcy litigation.
This Section 6.17 shall survive any termination of this Agreement.
6.18 Informal Dispute Resolution. The Parties shall attempt in good faith to resolve any
differences, controversy or claim arising out of or relating to this Agreement promptly by negotiations
between senior officials of the Parties who have authority to settle the difference or controversy. The
disputing Party may give the other Party written notice that a dispute exists between them so that the
provision of Sections 6.18.1 and 6.18.2 shall apply("Dispute Notice").
6.18.1 Within twenty (20) days after receipt of a Dispute Notice, the receiving Party
shall submit to the disputing Party a written response. The Dispute Notice and response shall;:include: (i)
a statement of each Party s position and a summary of the evidence and argumerit§_supporting its.Qosition,.�
- .. __and:.(ii the naive anii title of the otl'icial�vtto sliall represent tliat-Party. The`senior o icrals shall meet at
a miifrially;acceptable time and place or by telephone conference within thirty(30) hays of the date of the
Dispute Notice, and thereafter as often as they reasonably deem necessary to exchange relevant
information and to attempt to resolve the dispute. In the event any Party fails to provide a response to a
Dispute Notice in accordance with this section or fails to cooperate in the scheduling of, or to attend the
meetings, described above, to resolve the dispute, then, with respect to that Party, the Resolution Period
shall be deemed to have run so that the dispute may immediately be subject to arbitration in accordance
with Section 6.18.2.
6.18.2 If the matter has not been resolved pursuant to Section 6.18.1 within ninety(90)
days of the date of the Dispute Notice ("Resolution Period"), (which period may be extended by mutual
agreement), or if any Party will not participate in arch procedure, either party may seek all legal and
equitable remedies to which it maybe entitled.
6.19 Compliance With haws. Stater,shall carry out the construction of the Project in
conformity with all applicable federal, state and local laws.
6.20 Nondiscrimination in Employment. Stater agrees that it 'shall not discriminate
against any employee or applicant for employment because of race, color, creed, religion, age,
sex,marital status,handicap,national origin or ancestry.
[Signatures on Following Pages]
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the last date set
forth below.
STATER
STATER BROS.MARKETS,
a California corporation
Date. By:
James W.Lee
Its: President and Chief Operating Officer
Date. By:
Phillip J.Smith
Its: Executive Vice President, Chief Financial
Officer and Chief Accounting Officer
CITY
CITY OF GRAND TERRACE,
a California municipal corporation
Date. By:
Maryetta Ferri
Its: Mayor
AGENCY
CITY OF GRAND TERRACE.-RE-DEVELOPMENT
AGENCY - _
Ta California public_body;'corporate.and politic
Date. By:
Maryetta Ferri
Its: Chairperson
APPROVED AS TO FORM
John Harper. City and Agency Attorney
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[END OF SIGNATURES]
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EXHIBIT C
TO
ECONOMIC DEVELOPMENT AGREEMENT
Public Parking Easement Area
[Attached Behind This Page]
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EXHIBIT A
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ECONOMIC DEVELOPMENT AGREEMENT
Legal Description of Stater Property
[To Be Attached Behind This Page]
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EXHIBIT B
TO
ECONOMIC DEVELOPMENT AGREEMENT
Project Site Plan
[Attached Behind This Page]
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ARCHITECTURAL LIST OF
DRAWINGS
AAO SITE PLAN
A-1.0 MAJOR A A SHOPS I PLAN
A.1.1 PAST p40 ME RETAIL I PLAN
A4LO MAJOR A ELEVATIONS
"I SHOPS I ELEVATIONS
A*j PAST r000 ELEVATIONS
&*a RETAIL I ELEVATIONS
SL,j SITE LIGHTING PLAN
CLp.-I OVERALL PLANTING PLAN
PLAN MARCH 11.20Pn
RETAIL CENTER A-0.0 VLU
SITE PLAN
T' 'N-111IFF,
Grand Terrace Town Square,Grand Terrace California
DEVELOPMENT UNIT ONE
ATTACHMENT #2
LETTER FROM STATER BROS.
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August 18, 2010
via email
Joyce Powers
Community & Economic Development Director
City of Grand Terrace
22795 Barton Rd
Grand Terrace, CA 92313
RE: Proposed new Grand Terrace Store
Economic Development Agreement ("EDA")
Dear Joyce:
Thank you for following up today and letting us have the chance o discuss the remaining
last few steps we need to keep the project going.
To clarify the issues we discussed, we-understand the limits under the EDA limit the City of
Grand Terrace investment for this project at $1,207,500. If the FTE falls below 77 in one year or
exceeds 77 in another year, the annual payment may adjust, but the total covenant for the five-
year period listed in Section 3.2 would not exceed $962,500.
There appears to have been a typographic error in the information I sent out regarding
parking, which should have been $12,250.00/space/qtr. and not the12,251.25/space/qtr. as
'shown-i'n°Section 3.2 of the EDA. - Based-upon this, this portion�'of-tfie` EDA would cap out -at = =
$245,000.
I hope this adequately updates you on the plans we have. Should you have any
questions, please give me a call.
Yours very tr ly,
Michael T. Slaton. Sr.
Senior Director of Real Estate
2F
Please see Item No. 1 under CRA for complete report.
COUNCIL AGENDA ITEM NO.