HomeMy WebLinkAbout2002-03-26 - AGENDA REPORTS - EMPLOYEE PARKING LOT LEASE (2)CITY OF SANTA CLARITA
AGENDA REPORT
PUBLIC FINANCE AUTHORITY
DATE: March 26, 2002
City Manager Approval:
Item to be presented b . Steve Stark
SUBJECT: EMPLOYEE PARKING LOT CAPITAL LEASE
DEPARTMENT: Administrative Services
RECOMMENDED ACTION
1. Public Financing Authority (PFA) approve a resolution, authorizing the City Manager to
execute capital lease agreements through Zions First National Bank to purchase a parking
lot, for an amount not to exceed $1,200,000, subject to City Attorney approval.
2. City Council approve resolution authorizing and directing City Manager or designee to
take certain actions associated with the execution of capital lease agreements to purchase
a parking lot, for an amount not to exceed $1,200,000, subject to City Attorney approval.
BACKGROUND
In December, the City was notified that it will have to move off of the leased employee auxiliary
lot by March 15. As a result, staff made every attempt to search for solutions to accommodate
additional employee parking.
After multiple discussions with Newhall Land, the Administrative Services Department,
working with the City's Engineering and Facility Maintenance staff, determined that the
property located on Citrus Street would be a viable long-term solution for employee parking at
City Hall. Staff has completed an appraisal, phase I environmental, and soils testing. No
adverse finding resulted from the phase I environmental study or from the soils tests. Both
parties have agreed to a purchase price of $16 a square foot (which is below the appraised value
of $18 a square foot), plus the cost of improvements, including the parking lot, landscaping,
lighting, and NPDES requirements. The total purchase price will not exceed $1.2 million.
Since the purchase and improvement of the property will not occur until after the March 15
date, arrangements have been made to temporarily move employee parking to the Town Center
Mall parking lot, on the corner of Valencia and Citrus. In addition, the Facilities Division has
worked out a solution to reduce the number of City vehicles that need to be parked in the lot
by allowing selected staff to temporarily drive their work vehicles home after hours. This is
meant to be a temporary solution, while the new parking lot is being constructed.
In order to make the purchase, the Administrative Services Department is recommending that
a capital lease be used to purchase the property over ten years, so that it does not impact the
general fund budget with a single -year, up -front cost. The Planning & Building Services
Director has found the use of the property consistent with the City's General Plan and has WA
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EMPLOYEE PARKING LOT CAPITAL LEASE
March 26, 2002 — Page 2
determined that the property is exempt from CEQA review. However, as mentioned above, a
phase I and soils testing has taken place as part of the due diligence that staff completed.
The following information summarizes the terms of a capital lease:
Amount:
Term:
Amortization:
Interest:
$1.2 million
10 years
Semi annual
4.79% (fixed)
Est. Lease: $ 152,430
Total Cost: $1,524,300
Condition: No penalty for prepayment
Staff is recommending that the Public Finance Authority approve a resolution that authorizes
the City Manager to complete all necessary documents that will finalize the capital lease.
Additionally, staff is asking the Council to approve a resolution that authorizes the City
Manager to execute all lease documents associated with the purchase of the parking lot
property.
ALTERNATIVE ACTION
1. Public Finance Authority not approve the resolution, authorizing the City Manager to enter
into agreements for purchase of the employee parking lot through a capital lease.
2. Other action as determined by the Public Finance Authority.
3. City Council not approve the resolution, authorizing the City Manager to enter into
agreements for purchase of the employee parking lot through a capital lease.
4. Other action as determined by the City Council.
FISCAL IMPACT
As stated above, the total cost of the property, with all the necessary improvements, will not
exceed $1,200,000. The annual payment for the capital lease will be approximately $152,430
over a ten-year period. Staff will include this amount in the fiscal year 2002-2003 budget. The
first payments will not be scheduled until 2003.
ATTACHMENTS
Public Finance Authority Capital Lease Resolution
City Council Capital Lease Resolution
Capital Lease Fixed Rate Real Property Lease Purchase Agreement (available in City Clerk's
Reading File)
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