HomeMy WebLinkAboutCC MINUTES 1970 03 10 MINUTES OF A SPECIAL MEETING
TUSTIN CITYCOUNCIL
March 10, 1970
CALL TO
ORDER Meeting called to order by Mayor Coco at 8:~1 PM.
II.
---PLEDGE OF
ALLEGIANCE Led by Mayor Coco.
IV.
ROLL CALL Present: Councilmen: CoCo, C. Miller, L. Miller.. Oster,
(Marsters arrived at 8:30 PM)
Absent: Councilmen: None
Other~ Present: City Administrator Harry E. Gill
City Attorney James Rourke
PUBLIC
HEARING NEWPORT AVENUE OFF-RAMP
Mayor Coco gavea general overall view of the issue. He
stated that the State had included in the off-ramp agree-
ment a paragraph which insisted that the City agree to the
Ultimate widening of the Santa Ana and Newport Freeways in
order to begin construction on the ramp. The State was now
willing to hold off on the ultimate agreement. and it is no
longer a pre-condition for~the off-ramp. On the other hand,
he stated, the initial.estimated cost of $50,000 had~quad-
rupled according to a.recentappraisatto $190,000.
_. He stated that the State would not bear any additional costs
of the City's right-of-way; the City could not pay the Sta~e
back over a three-year .period; and the amount of land required
for the off-ramp could not be reduced. The major problem
is additional funding. He had received a letter from Bob Flint
of the Chamber of Commerce stating that the Chamber felt the
off-ramp was vital to the community and that action should be
taken now. He had also received calls from two people, one
withdrawing his'supportof the ramp because of the damages that
would occur to the properties involved and the other person
felt the City had priorities which should take precedence.
In summary he stated that the issue was now in the neighbor-
hood of $200,000 to $250,000 which included no construction
costs and would have to be borne by the City. The City had
originally agreed to the $50,000 figure which has now quad-
rupled.
Public'hearing opened at8:08 PM.
Mayor Coco stated~hat this meeting was to give the Council
some idea of what action to take, whether to condemn~or not.
Mr. Arthur Peterson, 653 South "B" Street, Tustin, asked
whether the ultimate pllan would take more property.
Mayor Coco stated that it would if approved by the Council,
but that was not the issue now. The concern now is where the
off-ramp begins and terminates on Newport Avenue.
Mrs. Lee Wagner, repreS~intative of the Downtown Businessman's
Association, asked why .the appraisal was so late and who was
responsible for it.
Mayor Coco.explained t~atat the State Highway Commission
meeting.in February, 1969, Mr. Hill had indicated that the
right-of-way cost was about $40,000 and the construction cost
was abou~ 850,000.
M~a_~tll ~ ~hat .t~ o~igihal estimate of c~-i~ i9~6
~ .
Councj. 1 Meeting
3/10/70 Page 2
Mayor Coco explained that as late as February 1~68, the
City had been going on the price of $40,000 and the possibility
of $50,000. The initial decision to build the off-ramp
was made on this basis. Only recently did it become necessary
to find out exactly where the City stood and to have an
appraisor. Also, the original plan did not include the
pro-school or the Animal Hospital which has increased the
appraisal.
Mrs. Wagner asked why was there a change in the amount of
property to be used. __
Mayor Coco explained that the State Engineer had developed
a more.encompasSing design. He explained further that
the increase in estimate from the $130,000 figure mentioned
three weeks ago to the present $190w000 was due to the
inclusion of figures from the pre-school and Animal Hospital
which. had not been obtained before.
Mrs. Wagner stated that $190,000 was a lot of money-but that
the City should look to the future. The City would stand a
better chance of being saved from the interchange if the
off-ramp existed. Alsow if the. businesses are to make money
they need the.backing of the Council. She pointed out the
lack of improvements on "D" Street as an example. She suggested
having.another appraisal.
Mayor Coco explained the time limit that had been imposed
upon the Council was dueto the proposed construction of the
"Sizzler" which could begin any time as the permit~ had been
issued. This meeting had been called hy the City to avoid
liability for construction work in case condemnation proceedings
were begun. He explained further that the appraisor was com-
petent and that his work was valid.
Mr. Gill, in response to questioning by Mayor Coco, explaine<
that the City had been using this appraisor over the past
five years. He had made a detailed analysis of the property,
had capitalized various costs involved over a long period of
time and had arrived at the $190,000 figure which he sets as
a m~nimum figure. He expressed confidence in the appraisor's
ability.
Councilman Oster asked how long it would take for a written
appraisal.
Mr. Gill explained that this current information had been
given to him by telephone due to the urgency of the situation.
A written appEaisaI would take at least two weeks, for a
standard form.
Councilman Oster asked if the appraisor was certain that figures
from a standard appraisal would come out the same.
Mr. Gill responded that the appraisor said they would.
Councilman Oster then asked if the $184,000 figure p~us costs
could be used as a reliable figure.
Mr. Gill responded that the figure here was based on the bes~
possible estimate without going to a full documented appraise
that would stand up in Court. He doubted that the figure
would change very much. The appraisor is willing to talk
to the Council and answer questions.
~Q~ln~il~n~ ~ ~i~ asked for his name.
Mr. Gill stated that the appraisor's name was Robert Harrison.
~p.uncilman Oster asked if the Council could get an appraisal
by Monday.
Mr. Gill responded that perhaps the Council could get a
letter, but not an appraisal that would stand up ~n Court.'
Council Meeting ~o
3/10/70 Page 3
Mr. Rourke stated h~Ad ~'!ialked with the appraisor but
said he was competent. He could have something to preseht
Ithe next Council meeting but a standard ap~al would
Mr. Gill stated that the appraisor had already spent more
than 9 hours on the appraisal.
Mr. Peterson asked if an alternate off-ramp had been considered,
such as Laguna Road.
Mayor Coco stated that the State had proposed several alter-
natives, but the City had fel~ them not to be beneficial to
the City. One alternative had been the Laguna Road route,
but the City had rejected it as less desireable than the Newport
off-ramp,
Mr. P~terson asked if this decision had been made in knowledge
of the costs of the Newport off-ramp.
Mayor Coco stated that there had been no discussion either
publicly or privately at this time.
Councilman Marsters entered at 8:30 PM.
Mr. Gill explained that an alternative off-ramp at Laguna Road
had been discussed~but!that it was figured that the right-of-
way costs at this ~ocation would cost around Sl.6 million.
Jean Adams, 181 E1 Camino~ Tustin, said it appeared to her that
the main pzDblem seemed to be money. The improvements on 4th,
17th, and 1st Streets have cost the City a great deal of money
and it seems to be time for the City to consider the old down-
town area, as people there pay the same taxes. The old down-
town Tustin area will deteriorate if the off-ramp is denied.
E1 Camino would then be thelast area to be improved because
the City would not know what to do with it.
David Hook, 14~32Carfax, representative of Tustin Community
~ospital, stated that the off-ramp was necessary for people
using the hospital in anemergency situation.
Frank Greinke, President of the Tustin Chamber of Commerce,
stated that he had genera.tedthe support of the political
leaders and had involved the total community in this endeavor.
The business community wants the off-ramp fo~the revenue
and the City should want it to increase the revenue for the
tax base. He 'stated concern about the City,'s attitude in
investing in the business community. He stated that there was
money available to the City for this purpose. He suggested
that the City could~borrow' $1C0,000 (there is $8,000 in taxable
revenue) at a rate of 7½%. The interest would be S42~4'46 for
ten years. This wouldbe basically a loan as.the City would be
eventually reimbursed by the State. However, he stated, he
was beginning to lose credence as the figure keeps rising.
Ma~or Coco stated that the State would reimburse the City only
if the City agrees to the ultimate widening of tke freeways.
So far the Council has been unwilling to make a 10-15 year
committment.
Mr. Greinke stated that he had talked with financial institution~
that would bewilling tomake an investment, but it would have
to'be a good bus~ness dea~.
Councilman Oster aske~LMr~ Gill what were the borrowing powers
of the City asa municipality, how long could it borrow, at
what interest rates and obligations, etc.
Mr~ Gill stated that the City could borrow for a one year
period, not for a 10 year period.
Council Meeting
3/10/70 Page 4
Mr. Rourke stated that the City could not borrow other than by
issuing bonds and going to bond elections, etc.
Councilman C. Miller stated that there was another option and
that was by lease-purchase arrangement whereby the City could
get around this statutory requirement.
Mr. Rourke stated that as he understood the problem, the City
would have to purchase the property and pay for it in cash.
He didn't think the property owners would be willing to lease
their land to th~ City. The City can accept a loan for --
$100,000 only for one year.
Mr. Hook asked if the note had to be retired by the'end of
that one year.
Mr. Rourke stated the City could re-borrow,but could not get
a 10-year 'loan. '
Mr. Hook stated that if the lenders agreed, the City could
get a new. loan each year.
Councilman L. Miller asked if the loan could be written at
7½% on an option to renew at that percentage.
Mr. Rourke responded that this was noz possible. The idea is
that it requires voter approval.
Mr. John Watz, 25671 Chrisanta Drive, Mission Viejo, stated
that in talking about a 10 year loan, he did not think the
City could'find a lender who would agree to a 10 year interest
only payment; also he did not think that the City could get
a lender to make a committment on a fixed interest rate for
that period of time. At the end of one year, the loan will
most probably be subject to complete re-negotiation. __
Mr. Gill stated that the one year period referred to zn the
law is a fiscal year. If money were borrowed now, then it
would be due or subject tO re-negotiation on June 30, 1970.
It would be somewhat in vzolation of the law if the City were
to re-negotiate on the same loan.
Mr. Rourke stated that this goes back to the theory of bonding
and gettin~ the voter's approval if money is to be borrowed.
Obviously, if money is borrowed for 10 years and the City can
only borrow for one year, this would be a case of trying to
get around the law.
Dudley Frank, 17411 Irvine Blvd., skated that as one of the
owners involved he was interested in getting some return on
his property. Initially he was for the off-ramp but finally
after many years, he thought Something should be developed
on the property. The fact that it will be temporary means that
it will create only a temporary change in his property. He
speaks for all the property owners when he states he is against
the off-ramp.
Mr. Hook stated he had not realized that the off-ramp was to
be temporary. He didn't agree with the idea that the off-re
would give re-birth to Tustin. $200,000 for a ten year
period did not seem worth the investment. The money could
be put somewhere else.
Lou Gerding, 333 E1 Camino Real, Tustin, stated that the down-
town Tustin area needed something, The businessmen have receive~
no support.
Frank Brown, 420 West Firs%, Tus~in, stated he owned a business
~~t and was in ~avo~ of an O~-~m~ an~ ~n e~am~
too, if possible. It would relieve congestion on Red Hill.
Jerry Mack, 14652 Pacific, Tustin, stated he owned a business
on Irvine Blvd. and asked the Council to re-consider what was
discussed at the meeting in Pomona. FL~ning has been to
utilize unused areas in ~he downte~,~ a~-. ~ arid the best way to
Council Meeting
3/10/v0 Pa e s
do this was to increase traffic. There is now a moral
obligation to those legislators who have supported the City.
John Prescott,' 18752 East 17th Street, Santa Ana, stated
he had'spent many yearson "B'~ Street with his business.
~I, stated that the off-ramp would have to be on Newport
ntualiy. It would be th~ threshold for an~i~I~ovement
in the downtown area. The City needs accessibility to
the high quality areas if~they are to be developed. The
off-ramp should have been developed in 1953, but the Council
at that time lacked far-sightedness.'
Mayor Coco stated that this situation was more comRlex'. A
pre-condition to the building of this off-ramp is an agreement
that would make it temporary until the freeway is ultimately
widened. The off-ramp now being contemplated will be signed
out of existence before it is built. Is it worthwhile to
invegt in a temporary off-ramp, especially when condemnation
proceedings will have to take place and the property owners
will contest which will hold!off construction of the off-ramp
for perhaps two years?
Mrs. Adams suggeste~ that the contract with the State could
be changed later when the need existed.
Mayor Coco responded that this would be a risk.
Mr~ John Siegel, 515 East 1st Street, stated that he felt
the Council should consider other projects in the City which
would offer a lasting and permanent benefit to the City, such
as the widening of First Street, thebeautification and
installation of street lighting on E1 Camino Real, a new Civic
Center, the acquisition and development of a centrally-located
park, the beautification of Laguna Road, etc. All or ~ny
of these would stimulate economic growth and would be a permane
improvement to the City.
Robert Stacy, representative of Southern Pacific, stated
that the railroad tracks would eventually be re~ved and that
the Off-rampwould be vital to the development of their propert
Mayor Coco asked if the Council could get some support in
obtaining funds for theoff-ramp.
Mr. Stacy stated that the Company would involve itself to the
'extent of its property holdings.
Mayor Coco stated tha~ the Council would like to get an aggre-
gate feeling of what Support it could expect from the City.
Mr. Stacy responded that he would have to check with his
Company.
~ouncilman L. Miller asked if Mr. Stacy knew of any time when
his management had made a contribution toward anything of this
nature.
Mr. Stacy stated that hedid not recall; however, his knowledge
of his Company's contributions was limited.
Mr. Greinke thanked the Council and legislative representatives
for their efforts and time spent on this project.
Mayor Coco thanked Mr. Greinke for all of the time he has
spent. He stated that e~eryone on the Council wanted the off-
ramp and that there were not two sides to this issue. In
recent weeks the CounCil has been trying to make a decision
that will serve and benefit the entire community. What the
Coun~l must determine is whether the City will benefit more
from a substantial investment in this one major project or
from a number of projects. The TNT Sub-Committee feels the
improvement of First Street would be one Of the most important
benef~ ~h~ ~ity. ~ BUSinesses on Newport Btvd~ feel ~ha~
Counci 1 Meeting
3/10/70 Page 6
the off-ramp will be the greatest benefit. It is necessary
for the Council to know what the pro~ects are and what has
been budgeted, as well as the priorities. Most of all it
is necessary to know the ultimate cost. Even if the appraiser
is 100% high, the cos~ would still be $100,000 and that is
still 100% more than what the City had originally expected.
All of the City's arguments at Pomona and all of the Council
and Staff support and involvement have been directed toward
getting this off-ramp with the idea that the $50,0~0 cost to
the City would be justified because of the economic benefit
to the City and the convenience to the residents.
As the price continues to rise the Council is beginning to
wonder if it should re-evaluate and decide if the fight for
condemnation .and the price will be worth it, and if the other
priorities are that subordinate to the off-ramp. The City
was not considering these questions at Pomona. The meeting
tonight, for the first time, has brought out the arguments
against the off-ramp. He stated he was seriously concerned abou
spending monies when the list of priorities is alEe~dy high.
The Staff has made a list of priorities that could be cut,
placing the least valuable first: The first one to be 'cut
would be the improvement of Laguna Road in front of Tustin
Union High School; the next would be the traffic signals at
McFadden and Williams followed by the street improvements on
Laguna from E1 Camino to Newport.'By anticipating increased
revenues due to population increase the City would then have,
with these cuts in priorities, the $130,000 needed prior to
this most recent estimate. To raise $190,000, the next project
to be cut would be the street projects at Centennial Way
and Civic Center; next would be the Main Street Storm Drain
followed by the street improvements at ~ain Street and Civic
Center and then the traffic signals at Red Hill. These are
budgeted items; nothing has yet been mentioned about the
improvements which Mr. Siegel listed~
Mr Gr~inke asked if the City had any property to'sell.
Mayor Coco responded that the City had no property to his
knowledge other than the Civic Center site°
Mr. Peterson suggested getting a temporary off-ramp onto
Orange Avenue.
Mayor Coco stated that the problem here was one of immediate
acquisition and the Newport acquisition compared to the
property surrounding Orange Avenue was the least costly.
Mr. Gill explained that the Orange proposal would necessitate
a complete change at the Red Hill interchange and the right-
of-way cost would be about $1.6 million.
Ma~or Coco stated that the weaving factor at Orange would be
even worse than at Newport which was very tight. The State
was against the off-ramp for reasons of safety, convenience
(would like to have an on-ramp as well), and ~lanning (due to
the ultimate widening of the Freeways).
Mr. Rollin Mahoney, 13661 Wheeler, Tustin, asked if the off-"
ramp cost approximately $20,'000 a year (for 10 years), how
much would the sales tax have to ~ncrease each year to produ .
that revenue.
Mr, Gi~! responded that as the City gets 1%, $2 million in added
Mr. Mahoney stated that in considering the.traffic count, the
off-ramp would be taking people to south Santa Ana as well.
Dr. Stanton, 1192 Laguna Road, Tustin. stated that, as one
of the two businesses along th9 proposed route, he was not
definitely against the ramp excep~ that it would make some
changes for him. The fifteen feet to be taken off his parking
Council Meetin~t
3/10/70 Page 7
lot would make him totally illegal. The $23,400 estimated
cost wouid not'anywhere near cover the expenses that he
would incur to maintain his business. $29,500 would be
a conservative estimate.
~<~"~ncitman Oster stated that as a matter of ~a~ysis, the
City has been remiss innot getting an earliS['~D~pr.aisal.
Obviously, it is an expensive piece of property and in
order to acquire it, the City will have to give up quite a
few budgeted items. None Of the budgeted items, however,
concern E1 CaminO Real whidh is obviously a neglected area.
He statedhe would doall he coUld to see that some money
in next year's budget dOeS'go into the downtown business
area and E1 Camino Real Specifically. He stated he' was con-
vinced the City had neglected that area due to no solution
for it.
He further stated that he believed the $200,000 estimate
was realistic. Perhaps morally the City should continue with
the off-ramp~ but=the City also had a responsibility to the
community as a whole. He would like to see an appraisal of
the property~·
Mayor Coco stated that at the coming budget session some
projects may bedelayed or omitted in favor of certain improve-
ments along E1 Camino Real.
Councilman L~ Miller asked what was the value of the Civic
Center property.
Mr. Gill stated that the cost was $230,000, so the value of
the property was at least that figure if not more.
Councilman C. Miller stated that the question goes beyond the
$130,000; after that there would be budget problems. If
this were a permanent investment, the $200,000would not bother
him~ As the problem now exists, the Council must make some
pretty rigid committments and expect Only eight ormore years
of use from the off-ramp. He would also like to have a standard
appraisal.
Mayor Coco stated that='Dr. Stanton felt the estimate was low
a~ do Councilmen Oster'and C. Miller. He s~ated he was against
spending money on an appraisal when many felt the-estimate
was already low. This would be an unwarranted expenditure.
Councilman L. Miller asked if the City could get. a State
appraisor.
Mr. Gill stated that the State Right-of-Way Department in
a letter' dated January 30, 1970, had made an estimate of
$75,700 based en a flat~$1.00 a foot estimate. This was not
an appraisal. Accordingly, this is the only figure they
have at this time.
Mayor Coco asked if the State had sent an appraisor to make
local interviews.
Mr. Gill responded that the State had not to his knowedge.
The SEate will use the $75,700 estimate until an appraisal is
made.
Councilman Oster stated hewanted a firm letter of appraisal.
Mrs. Wagner also insisted that a standard appraisal be made.
Councilman Oster state~ he wanted to send a copy of the
appraisal to all people Who had been concerned with the off-
ramp as proof that/-it was in actuality too expensive.
CoU.~.~il~B C..Miller stated that the Council owes it to the
pe~t~ ~v~tve~ and to themselves to substantiate why the
de'~i~te~wa8 ma~ ~he way it was, to get a s~andard appraisal.
...~ Council Meeting
3/10/70 Page 8
Mayor Coco questioned if the purpose then would be to send
the appraisal and po'ssibly correct some of the State's
,appraisal practices?
Mr. Gill stated that an appraisal in the form of a letter
might take a couple more days. $175.00 has been spent for
one day already.
Mr. Larry Webster stated that appraisors usually cost between
$25 to $35 an hour.
Mayor Coco s~ated he would like to know what the cost of
the appraisal would be.
Mr. Gill stated he could not estimate the cost at this time.
It was finally concurred by the Council that Mr. Gill be
directed to contact the City's appraisor, Mr. Robert Harrison,
and request that he execute a formal letter to the City settin~
forth his findings, his approach, and the amount of detail
that was necessary and to further request all back-up notes
that would indicate the method by Which he arrived at his
estimate.
Councilman Marsters stated that he shared the concern of
the other Councilmen in this matter. He stated that he had
become skeptical and felt that the off-ramp was not a cure-all
for the revitalization of downtown Tustin and "D" Street and
that it was not worth that much money for what would be gained.
He stated that he agreed with Mr. Siegel in that there were
many things which the City could do with that amount of money.
More'"attention should be paid to the downtown area and will
be in the future. He agreed that the most popular decision
tonight would be to go ahead with the off-ramp, but the fact
that it would only be temporary and that the condemnation
proceedings would mot be at all friendly changes the situat3 ~
a great deal. He suggested that the CoUncil take no action
and defer a decision until Monday. He stated h~ was against
'condemnation proceedings.
Meeting adjourned.
TY CLERK