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Home My WebLink About1995-11-28 - AGENDA REPORTS - HOTEL CONFERENCE CENTER (2)AGENDA REPORT City Manager Approval Item to be presented by: Ken Pulskamp UNFINISHED BUSINESS DATE: November 28, 1995 SUBJECT: HOTEL / CONFERENCE CENTER DEPARTMENT: Community Development BACKGROUND Based on community interest expressed for local meeting and banquet facilities as stated in the community strategic planning sessions, the City's Economic Development Division has been working to establish a hotel/conference center. The Newhall Land and Farming Company has developed a joint public/private hotel conference center proposal for consideration.. The project envisions a 200 room hotel with an adjoining conference center. It would represent approximately $32 million in tax revenue over the next 30 years and the creation of 150 new jobs, Based on previous direction from the City Council, the City Manager has continued negotiations with respect to the level of public financial participation in the project and has reached a common agreement as spelled out in a Hotel/Conference Center Development Project Memorandum of Understanding (M.O.U.). The key public policy points contained in the M.O.U. are use of the name "Santa Clarita" in the name of the conference facility, a guaranteed annual time allotment for public use of the conference center facility, and public sector financial participation in the conference center project for an amount not to exceed $3,075,000 million dollars in Economic Development Administration (E.D.A.) funds. RECOMMENDATION It is recommended that the City Council: 1) approve the attached Memorandum of Understanding between the City of Santa Clarita and Newhall Land and Farming Company; 2) approve a public funding contribution of $3,075,000 E.D.A. funds toward the development of a conference facility; and 3) increase Estimated Revenue Account #01-95053-227 by $3,075,000 and appropriate $3,075,000 in Account #01-95053-227. ATTACHMENT Hotel/Conference Center Development Project Memorandum of Understanding (M.O.U.). MKH:ll�oaaev%ar>>zass.eot N E W H A L L L A N D November , 1995 DRAFT City of Santa Clarita 23920 Valencia Boulevard, Suite 300 Santa Clarita, CA 91355 Attn: City Manager, George Caravalho Re: Propos This letter will summarize our agreement regarding the development of a 18,000 square foot conference center and a 200 room, full service hotel ("Conference Center/Hotel"), near the southwest corner of McBean Parkway and Town Center Drive. The principal purpose of this letter is ensure that the City of Santa Clarita ("City") and The Newhall Land and Farming Company ("NLF") have reached an understanding with respect to the fundamental points relating to development of the Conference Center/Hotel, without which, the time and effort that will go into NLF's designing, making application for entitlements and permits and constructing the Conference Center/Hotel would not be warranted. we each recognize that all of the points outlined below are essential to NLF's proceeding with the development of the Conference Center/Hotel. The benefits to both City and NLF are outlined below. In addition, we have summarized our understanding regarding our respective financial obligations and the Conference Center/Hotel's entitlements. THE NEIIII LAND AND FAPMPNG COMPANY 23823 VALENCIA BGULEVn 0 VALENCIA,, CAUFDPNiA 91355 18051 255.4000 RISILVER 99999 239537 2 City of Santa Clarita November , 1995 Page 2 City Benefits • Meets Long standing Community Desire for Local Meeting and Banquet Facilities • Will Generate New Public Revenue, Including Transient Occupancy Tax from Related Hotel Development • Jobs Creation (Construction and Permanent) Development of Public Accommodations and Community Facilities • Will Foster Business.Growth and Accommodate Public Events NLF Benefits • Development Certainty • Will Augment Community Facilities Financial obligations • NLF will make an investment of approximately $23.6 million (including land and improvements) to develop the Conference Center/Hotel. • City will invest $3.075 million of Federal Economic Development Administration Funds for the public infrastructure RISILVER 99999 239537 2 City of Santa Clarita November , 1995 Page 3 improvements described in Exhibit l relating to the development of the Conference Center/Hotel and other commercial projects within the general area. City agrees to complete the infrastructure improvements in accordance with a construction schedule to be agreed upon between City and NLF. ° If following the completion of the infrastructure improvements by the City, NLF decides not to construct the 'Conference Center, it will reimburse the City for the cost of the aforementioned infrastructure improvements nottoexceed $3.075 million. Entitlements Schedule The Planning Commission will process applications for approval of a Conditional Use Permit, Minor Use Permit and any other discretionary approvals that may be required to develop the Conference Center/Hotel. The Conference Center/Hotel will be scheduled for consideration by the Planning Commission as early as practical following completion of application. - Construction City and NLF agree to use their respective reasonable best efforts to ensure that the Conference Center/Hotel is constructed and open for business by year end, 1997. RISILVER 99999 239537 2 City of Santa Clarita November , 1995 Page 4 Operations The operations of the Conference Center/Hotel will be managed by a hotel operator/partner selected by NLF. Project Name The Conference Center will have exterior signage identifying it as "Santa Clarita Conference Center" and will include the Hotel's name and logo. community Usage The hotel operator will work with the City to develop a schedule to provide a minimum of 12 events per year for use by the local community of the Conference Center banquet facilities at prevailing rates. It is the intention of the hotel operator to make every effort to accommodate requests from the community. Authority Each person executing this letter agreement represents that the transaction contemplated by this letter agreement has been duly authorized by their respective party and each party's obligations are legally binding and do not require the consent of RISILVER 99999 239537 2 City of Santa Clarita November , 1995 Page 5 any other party; however, City acknowledges that final NLF Board approval will be required and an agreement with a hotel operator/ partner remains to be finalized; and NLF recognizes that land use entitlements will be processed by the City in accordance with state law and City's ordinances. miscellaneous Time will be of the essence in the performance of each of our respective obligations, including entitlement and building' permit processing, the completion of infrastructure construction and the development and construction of the Conference Center/Hotel. This letter agreement sets forth the entire understanding and agreement of City and NLF with respect to the Conference Center and Hotel project and there are no oral or written understandings or agreements that are not contained in this letter agreement. Conclusion Upon execution of this letter, NLF agrees to proceed diligently with obtaining its Board of Directors' approval, the selection of a hotel operator/partner, the design and application RISILVER 99999 239537 2 City of Santa Clarita November , 1995 Page 6 for approval of the Conference Center/Hotel project and City agrees to expeditiously process the applications for approval of the development and construction of the Conference Center/Hotel project. If the foregoing correctly sets forth our understanding, please sign one copy of this letter and return it to us. CITY OF SANTA CLARITA George A. Caravalho City Manager ATTEST: City Clerk Approved as to form: City Attorney RISILVER 99999 239537 2 THF-'NEWHALL LAND AND FARMING COMPANY (A CALIFORNIA LIMITED PARTNERSHIP), a California limited partnership By: NEWHALL MANAGEMENT LIMITED PARTNERSHIP, a California limited Partnership, Managing Partner By: NEWHALL MANAGEMENT CORPORATION, a California corporation, Managing General Partner By: Its: