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HomeMy WebLinkAboutStaff Report 414-08City of Palo Alto City Manager’s Summary Report 10 TO:HONORABLE CITY COUNCIL FROM:CITY MANAGER DEPARTMENT: ADMINISTRATIVE SERVICES DATE:OCTOBER 20, 2008 CMR: 414:08 REPORT TYPE: CONSENT SUBJECT:Adoption of a Resolution Designating 2560 Embarcadero Road, Known as the Former Sea Scout Building, to be Eligible as a "Sender Site". in the Transfer of Development Rights Program RECOMMENDATION Staff recommends that Council approve the attached Resolution designating 2560 Embarcadero Road, known as the former Sea Scout building, to be eligible as a "Sender Site" in the Transfer of Development Rights program. ~ BACKGROUND The former Sea Scout building is a 2,209 square foot wood frame structure composed of two one-story wings on each side and a taller center section equivalent to two stories in height. The building was designed by Birge and David Clark, and donated to the City by Lucie Stem on May 30, 1941. Located in the Palo Alto Baylands Nature Preserve, the building is currently in poor condition and its floors have been subjected to flooding during biannual extreme high tides. Its rehabilitation requires extensive sub-floor rehabilitation and relocation to a higher elevation at or near its current location in the Baylands Preserve. On May 6, 2002, Council adopted the Historic Resources Board’s (HRB) recommendation to designate the former Sea Scout building to the City of Palo Alto’s Historic Inventory in Category 1, as provided in Municipal Code Chapter 16.49. Council referred to the Policy and Services Committee (P&S) consideration of how the building could become a viable element in the Baylands to be used by the Sea Scouts and other organizations committed to preserving the building for youth and other community uses. The Council also gave direction to the Committee to review issuance of an RFP so that nonprofit organizations would be encouraged to participate. On March 17, 2003, Council adopted the recommendation of the Policy and Services Committee directing staff to: 1) remove the direction that the building be used for Sea Scout and other youth CMR:414:08 Page 1 of 4 activities; 2) prepare a Request for Proposals (RFP) to solicit proposals for an option to lease the facility; 3) in the process of selecting a tenant, give preference to an organization that would allow space for public use; and 4) ensure that the tenant’s use of the building be compatible with the Baylands. In response to the RFP, one proposal was received on April 13, 2004. On October 12, 2004, Council approved the September 14, 2004 Policy and Services Committee recommendation to: 1) not accept the proposal submitted by the Lucie Stern Maritime Center responding to an RFP to relocate, repair and lease the former Sea Scout base: and 2) direct staff to open discussions with Environmental Volunteers with a view of developing a long-term lease. In accordance with Council direction, staff cooperated .with EV while it conducted analyses to determine the feasibility of project for the former Sea Scout building based on the requirements of the City’s RFP for the property. On January 2007, EV submitted a proposal for an option to lease for the site. On July 8, 2007, Council approved a motion to: 1) authorize the City Manager to execute an Option to Lease Agreement with the Environmental Volunteers (EV); 2) waive certain City processing fees for the project in accordance with Policy and Procedures 1-25, Public/Private Partnerships; and 3) allow funds from the sale of the TDR Transfer Development Rights to apply to the EV project capital costs up to $300,000 with any additional amount over $300,000 subject to the approval of the City Council. The EV is a non-profit organization which promotes the understanding of and responsibility for the environment through hands-on science education. The Option to Lease Agreement, dated July 9, 2007, provides for a two-year option term during which EV must receive required approvals of its project plans to rehabilitate, relocate and reuse the former Sea Scout building and provide evidence it has the funds to complete the project. The 40-year lease provides for the EV to use the site as its office headquarters for conducting its mission and providing other public benefits. (Refer to Attachment B for a project summary.) On August 6, 2008, the HRB reviewed the EV project plans and its March 9, 2007 Historic Structures report for the building and recommended approval with conditions to the Architectural Review Board (ARB) and the Director of Planning and Community Environment (Planning Director). The HRB affirmed that the proposed rehabilitation of the building meets the definition of "Historic Rehabilitation" set forth in Municipal Code 18.18.030(b), and that the proposed plan complies with the Secretary of the Interior’s Standards for Rehabilitation and Guidelines for Rehabilitating Historic Buildings. On August 21, 2008, the ARB recommended approval of the project, including a Conditional Use Permit and an Initial Study/Draft Mitigated Declaration. On September 4, 2008, the project received final approval from the Planning Director. On September 15, 2008, Council adopted a Park Improvement Ordinance for the rehabilitation and relocation of the Sea Scout Building in accordance with the approved EV project plans. DISCUSSION The purpose of the TDR program is to encourage and support the rehabilitation of historic buildings. The program provides a floor area bonus for the qualified rehabilitation of Category 1 and 2 historic buildings and Seismic Category I, II, and III buildings which are either owned by the City of Palo Alto or located in the Downtown CD zone district. The size of the bonus is 2,500 square feet, or 25% of the existing building, whichever is greater. Here, the estimated bonus is 2,500 square feet. Floor area bonuses may be transferred (sold) from eligible "sender" sites for use on eligible non-historic "receiver" sites in the Downtown. For City-owned property, CMR:414:08 Page 2 of 4 floor area bonuses from eligible sender sites may be sold by the City on the open market through a public bid process. Funds from the sale will be used to rehabilitate eligible City-owned historic buildings. Section 18.28.060(d) of the Zoning Code outlines five provisions for eligible City-owned buildings to participate in the TDR program. A summary of those provisions is attached (Attachment C). The first provides for the Council to designate by resolution City-owned buildings that are Category 1 or Category 2 on the City’s historic inventory or Category I, II or III on the City’s seismic hazards identification list as eligible to participate as "sender sites" in the TDR program. As noted in the attached resolution,, the former Sea Scout building at 2560 Embarcadero Road in the Palo Alto Baylands is a Category I historic building on the City of Palo Alto Historic Inventory and as such qualifies to be a "sender site" in accordance with the first provision of Chapter 18.28.060(d). The resolution also notes the HRB review and recommendation for approval of the EV project design and the March 9, 2007 Historic Structures Report for the fotaner Sea Scout Building. The second provision, requiring the City Manager to establish a public bidding process to sell the bonus floor area development rights, has been completed and is attached (Attachment D). The procedure, based on the City’s formal bidding procedures, involves an appraisal to establish the minimum bid and Council approval of a Request for Bid Proposals (RFBP). Following Council approval, staff will advertise the RFBP and once bids are received, return to Council for approval of a bid proposal. The March 9, 2007 Historic Structures Report prepared by EV for the building fulfills the third provision of the attached summary requiring preparation of a historic structures report in accordance with the standards and guidelines of the State Historic Preservation Office. The proj ect has received approvals for its application from the HRB, ARB and Director or Planning thus meeting the fourth provision. Satisfaction of the fifth provision, establishment by the City Manager of a fund for the proceeds from the-TD~ sale, will occur following the sale of the TDR. The Council has approved allowing the funds from the sale of the TDR to apply to the EV project capital costs up to $300,000 with any additional amount over $300,000 subject to the approval of the City Council. TIMELINE Staff will return to Council in a month or two for approval of the Request for Bid Proposals (including results of the appraisal). RESOURCE IMPACT Approval of the attached resolution satisfies one of several provisions required prior to the sale of the transferable development rights for the former Sea Scout building. Sale of these development rights will result in revenues to be used for rehabilitation and adaptive re-use by the EV of the former Sea Scout building in accordance with approved plans. POLICY IMPLICATIONS This recommendation is consistent with existing City policy. ENVIRONMENTAL REVIEW CMR:414:08 Page 3 of 4 The former Sea Scout building rehabilitation and relocation project will be in accordance with the Initial Study/Draft Mitigated Declaration adopted by the Director of Planning on September 4, 2008. PREPARED BY: DEPARTMENT HEAD APPROVAL: MARTHA MILLER Senior Financial Analyst LALO ~ Director/Administrative Services CITY MANAGER APPROVAL: ENE ~anager ATTACHMENTS Attachment A: Attachment B: Attachment C: Attachment D: Resolution of the Council of the City of Palo Alto Designating the former Sea Scout building Eligible as a "Sender Site" in the Transfer of Development Rights program. Summary of Environmental Volunteers proposed project Summary of Provisions for Transfer of Development Rights for City- owned Property Procedure for Sale/Transfer of Development Rights CMR:414:08 Page 4 of 4 ATTACHMENT A RESOLUTION NO RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ALTO DESIGNATING 2560 EMBARCADERO ROAD, KNOWN AS THE FORMER SEA SCOUT BUILDING, TO BE ELIGIBLE AS A "SENDER SITE" IN THE TRANSFER OF DEVELOPMENT RIGHTS PROGRAM WHEREAS, Chapter 18.28.060(d) of the Palo Alto Municipal Code (PAMC) provides for the Council to designate one or more city-owned buildings that are Category 1 or Category 2 on the city’s historic inventory and/or Category I, II, III on the city’s seismic hazards identification list as eligible to participate as "sender sites" in the Transfer of Development Rights program as provided in Chapter 18.18 of the Zoning Code; WHEREAS, the former Sea Scout Building, located at 2560 Embarcadero Road in the Palo Alto Baylands is designated as a Category I historic building on the City of Palo Alto Historic Inventory; and WHEREAS, on July 8, 2007, Council approved an Option to Lease Agreement with the Environmental Volunteers, a non-profit educational organization, for the rehabilitation, relocation and reuse of the former Sea Scout Base; and WHEREAS, on August 6, 2008, the Palo Alto Historic Resources Board reviewed the project plans submitted by Environmental Volunteers and its March 9, 2007 Historic Structures report for the building and recommended approval with conditions to Architectural Review Board and the Director of Planning and Community Environment (Planning Director). The Historic Resources Board affirmed that the proposed rehabilitation of the building meets the definition of"Hi~storic Rehabilitation" set forth in Municipal Code 18.18.030(b), and that the proposed plan complies with the Secretary of the Interior’s Standards for Rehabilitation and Guidelines for Rehabilitating Historic Buildings; and WHEREAS, on August 21, 2008, the Palo Alto Architectural Review Board recommended approval of the project, including a Conditional Use Permit and an Initial Study/Draft Mitigated Declaration; and WHEREAS, on September 4, 2008, the project received final approval from the Palo Alto Director of Planning and Community Environment. NOW, THEREFORE, the Council of the City of Palo Alto does RESOLVE as follows: SECTION 1. The former Sea Scout Building at 2560 Embarcadero Road, shown on the attached Exhibit A, is hereby designated as a °’sender site" in the Transfer of Development Rights program. 081001jb 0130378 SECTION 2. The former Sea Scout Building rehabilitation and relocation project was the subject of An Initial Study/Draft Mitigated Declaration for the project which was adopted by the Palo Alto Director of Planning and Community Environment on September 4, 2008. INTRODUCED AND PAS SED: AYES: NOES: ABSENT: AB S TENTION S: ATTEST:APPROVED: City Clerk APPROVED AS TO FORM: Senior Asst City Attorney Mayor City Manager Director of planning and Community Environment 081001jb 0130378 ATTACHMENT B SUMMARY OF ENVIRONMENTAL VOLUNTEERS PROPOSED HISTORIC REHABILITATION, RELOCATION AND REUSE OF THE FORMER SEA SCOUT BASE, 2560 EMBARCADERO ROAD Improvements Relocation of the structure intact approximately four feet northwesterly of the existing location, away from the bay, in order to place the building on a new foundation to raise the building 3.5 feet and clear the 100-year base flood elevation. Use Improvements to the 2,600 square foot building including: 1.the addition of approximately 261 square feet to the second floor mezzanine; 2. construction of a 3-stall parking lot; 3. removal of portions of an existing sandbag seawall; 4. removal of a berm between the building and the road, 5. rerouting of an existing trail; and landscape improvements. Retention of numerous character defining elements for the building in accordance with the Historic Structures Report. Retention and reuse each of the significant exterior and interior spaces. ¯Office headquarters for Environmental Volunteers to conduct its mission, including meetings and training; ° Ecologically-oriented classes and exhibits. Public Benefits Benefits youth and the environment; Provides public information and education to Baylands visitors Rehabilitates and reuses a historic building. Incorporates numerous "green" design features; Restores the natural area around the site; Completes the Marsh Front Trail; Provides up to $75,000 of the cost of construction of a public restroom near the Duck Pond. ATTACHMENT C SUMMARY OF PROVISIONS FOR TRANSFER OF DEVELOPMENT RIGHTS FOR CITY-OWNED PROPERTY (Palo Alto Municipal Code Chapter 18.28.060 (d) The city council by resolution may, from time to time, designate one or more city- owned buildings that are Category 1 or Category 2 on the city’s historic inventory and/or Category I, II, or III on the city’s seismic hazards identification list as eligible to participate as "sender sites" in the Transfer of Development Rights program as provided in Chapter 18.18 of the Zoning Code. Before any transferable development rights are offered for sale, the city manager shall establish, in writing, a public process using the city’s formal bidding procedures to sell bonus floor area development rights from any sites so designated by the city council. - Before formally soliciting the participation of other organizations or agencies in the rehabilitation of a city-owned historic building, the city should have a historic structures report prepared by a qualified expert in accordance with the standards and guidelines of the California State Office of Historic Preservation. 4.Before concluding a sale of transferable development rights for any city building, the city shall comply with Section 18.18.080. ~ The city manager shall establish and maintain a special fund into which all proceeds of the sale of transferable rights, and any interest thereon, shall be deposited. Upon receipt and entry into the accounting records for the fund such monies shall be considered committed to the rehabilitation of the city-owned building from which the development rights were sold, or to the rehabilitation of other city-owned buildings in the Historic Category 1 or 2 or Seismic Hazard Categories I, II, or III. CMR:XXX:XX Page 1 of 1 ATTACHMENT D PROCEDURE FOR SALE/TRANSFER OF DEVELOPMENT RIGHTS FOR CITY-OWNED PROPERTY (Policy and Procedures 1-46/ASD) POLICY STATEMENT It is the policy of the City of Palo Alto that the dispos.al of City property and assets, including the transfer of certified development rights, be accomplished through a public bid process. To assure the highest return for sale of its assets, the process involves an appraisal of fair market value and an open and competitive bid process. The City Council may reject any or all bids and accept that bid which will, in its opinion, best serve the public interest. PROCEDURE Following designation of a city-owned site as an eligible "sender site," and determination of a floor area bonus in accordance with Palo Alto Municipal Code Chapters 18.18.070, 18.18.080 and 18.28.060 (d), the Real Property Manager shall appraise (or have appraised) the value of the rights to be sold to determine a minimum bid. The Real Estate Division shall prepare a Request for Proposals (RFP) to be placed on the Council Consent Calendar for approval. The RFP shall specify whether overbids shall be accepted. 3. Upon approval by the Council: 1) 2) An ad shall be placed in the Real Estate section of the local newspapers. Flyers advising of the offering shall be sent to all persons on the Real Estate Division "Surplus Property Mailing List," persons owning eligible "receiver sites," local developers and others likely to be interested in the offering. 4.The bid opening shall be scheduled by the Real Property Manager and the Purchasing Manager. At the bid opening the Purchasing Division shall: 1)Open Sealed bids 2)If specified in the RFP, accept oral bidding beginning at 5% above the highest written bid. The Real Estate Division shall forward the results of the bidding to the Council with a staff recommendation. The Council may reject any or all bids and accept that bid which will, in its opinion, best serve the public interest.