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HomeMy WebLinkAboutMunicipal Buildings - City Gym and Pool 1981-1987 M REQUE T FOR CITY COUN ACTION _ r February 18, 1987 Date GZ Submitted to: Honorable Mayor and City Council �. GG� Submitted by: Charles W. Thompson, City Administrator Prepared by: Melvin M. Bowman, Director, Community Servi 7 i G1� Subject: CITY GYM & POOL GROUND LEASE Consistent with Council Policy? [✓ Yes [ ] New Policy or Exception Statement of Issue, Recommendation,Analysis, Funding Source, Alternative Actions, Attachments: STATEMENT OF ISSUE There is a need to enter into a long-term ground lease agreement for the City Gym & Pool property. RECOMMENDATION Direct the City Administrator to approach the Huntington Beach City School District with the offer of a twenty-five year ground lease at $1 per year for the City Gym & Pool property. This offer would include the stipulation that the city shall renovate the City Gym & Pool building to meet.current city building code and to make it accessible to the handicapped. ANALYSIS In 1931 , the Huntington Beach City School District constructed a gymnasium and pool facility as part of Dwyer School . When it was determined that the building did not meet the earthquake standards set out in the State Schoolhouse "Field Act of 1933", the district sold the building to the city in 1967 for $1 . In addition, the city entered into a twenty-year ground lease for the .783 acre site at $1 per year. That lease will expire June 6, 1987, and will thereafter go - on a year-to-year basis. Should the district invoke the cancellation clause, the city must remove or demolish the building at an estimated $50,000. In 1978, the city began negotiating with the district for purchase or long-term lease of the property. City appraisers estimated the property at $238,800, while the district felt it was worth approximately $600,000. At that time, negotiations reached a stalemate. In November, 1983, a feasibility study for the restoration of the gym and pool facility was prepared by Nowak-Meulmester and Associates. Costs for renovation were estimated at $326,000. Inflation and the need to provide handicap access would raise that figure to $500,000. PIO 4/84 REQUEST FOR CITY COUP' ACTION Page Two CITY GYM & POOL GROUND LEASE In November, 1985, the district was approached by residential developers with the proposal to relocate school facilities to the Talbert-Beach Project Area. The city felt the district might be interested in the sale . or the extended. lease of the gym and pool site in conjunction with the residential development. However, the school board turned down the proposal and the district chose not to negotiate further on the gym property. In April , 1986, a letter was sent to the district to reopen negotiations. Consequently, dialogue ensued. On January 5, 1987, Dr. Gary Burgner, Assistant School Superintendent, wrote to the city offering a lease of $40,000 per year with a negotiable term or that the city could provide the district with 10,000 square feet of warehouse space. The City Gym & Pool is serving a need in the downtown area. Total participation last year was over 84,000 of which 40,000 were youth. The city has endeavored to make the facility available for student ractivities at Dwyer School . The Dwyer Parent-Teacher Organization reserved the center for sports events and dances approximately forty times last year with a total participation of over 8,300. This .is an average of 200 students per event. The city feels that a long-term lease of the property at $1 per year is fair because manpower and operating costs are over $125,000 a year, plus the city would be renovating the building for more than $500,000. By the end of the twenty-year lease, the city will have expended approximately $1 ,750,000 -in operating, parking lot and facility upgrading costs. -FUNDING SOURCE The estimated $500,000 renovation cost could come from the following sources: Park Acquisition and Development Fund General Fund Grants Bonds ALTERNATIVE ACTIONS 1 . Demolish the City Gym & Pool . 2. Provide 10,000 square feet of warehouse space for the school district. ATTACHMENT Location map MMB:mb 0706E/38-39 441-42 4-1 42 DWYER INTEREDIATE SCHOOL_ . 390 1502 PALM GPM 17th GPM W ( both schools ) ❑ o 0 PLAYGRCUND GATE CITY a "th.. GYM • U u� I PLAYGROUND c PARK/VG Co WALK • r THRU E Sth DWYER 5C- S.S. AGNES SMITH �U ELEMENTARY SCHOOL 'M PARKING PARKING EO StRV Spec. ed food DISTRICT trailer OFFICE G LKNRD'_ ( both SChooIST _ STA/R5 J / /�EWAY-' 14th lO N 1068 GP�oI • M t• • REQUEST FOR CITY COUNCIL ACTION P�aeA mT A-,e Date Apri 1 23 , 1981 k),// atw Submitted to HONORABLE MAYOR AND CITY COUNCIL Submitted by CHARLES W THOMPSON, CITY ADMINISTRAT eX'O 11'T t%r-AA Prepared by VINCENT G MOORHOUSE, DIRECTOR, COMMU Subject CITY GYM AND POOL SITE ACQUISITION DEFERRED BY COUNCIL Backup Material Attached [Xl Yes [ ]No TO _:51- 1�,/pl Statement of Issue Recommendation Analysis Funding Source Alternative Actions STATEMENT OF ISSUE The City acquired the Dwyer School gymnasium from the Huntington Beach City Elementary School District (HBCESD) in 1967 and is currently paying $1 per year for the use of the land on a 20 year lease The City has invested approximately one million dollars into remodeling, maintenance and program operation the past 14 years The City anticipates spending an additional one million dollars on the building and program between now and 1987 when the lease expires Both the Community Services Commission and staff feel the 783 acre City Gym and Pool site should be purchased in 1981 -82 in order to allow the City to control the destiny of the building when the lease has expired Charles Davis , City Real Property Agent, has estimated the value of the site at $238,800 RECOMMENDATION _Approve the budgeted amount of $238,800 within the Park Acquisition and Development _Fund for 1981-82 to acquire the] City Gym and Pool site, authorize staff to obtain an appraisal of the land in cooperation with the Huntington Beach City Elementary School District and authorize continued contractual work on the building rehabilitation with approved HCD and SB174 funding ANALYSIS With recent passage of the City's Dangerous Building Code, Chapter 17 12, it will be a requirement that the brick facia will have to be stripped from the building and the exterior restuccoed 'to meet the new code Council has recently authorized $200,000 of HCD funds to accomplish this task An additional $50,000 of HCD funds was previously allocated by Council to remodel portions of the building to meet handicapped accessi- bility standards, convert a storage room to provide exercise equipment so that physical fitness classes could be offered to the public and further interior refurbishing Adjacent Dwyer School fields have been lighted by the City for several years from the City Gym roof to allow youth groups to practice soccer and football in the evening hours Additional field lighting is planned for installation this spring with a four- pole, $40,000 lighting contract A 22-car parking lot to service the City Gym patrons was purchased last year and is also scheduled for construction this spring The City already has vested interest of over one million dollars in the City Gym and Pool There is no guarantee the $1 per year lease will be renewed in 1987 The City is currently spending $80,000+ in the operation of the facility as well as contemplating the capital improvements listed above P10 3/81 REQUEST FOR CITY COUNCIL ACTION SUBJ: CITY GYM AND POOL SITE ACQUISITION Page 2 FUNDING SOURCE: Park Acquisition and Development Fund (balance as of April 10, 1981 - $2,447,169.02) . ALTERNATIVE ACTIONS: 1 Continue the $1 per year land lease with the Huntington Beach City Elementary School District until 1987, and at that time either offer to purchase the land or renegotiate the lease. This would leave the destiny o f the. City Gym unresolved and the City's investment of two million dollars ($2,000,000) could be lost if the District decided it needed the land again. 2) . Continue the $1 per year land lease until 1985 without putting any additional capital funding into the building and then demolish the structure as per terms of the existing lease (City reponsibility) . ATTACHMENTS 1 . Minutes, Park Acquisition and Development Committee 2) . Sectional District Map Reflecting City Gym & Pool Site 3) . City Gymnasium and Pool Rehabilitation 1981-82 Report 4) . FIR # 81-48 VGM:NLW:mcb Enclosure ATTACHMENT 1 ---- ENCLO` - REQUEST FOR CITY COUNCIL ACTION; SUBJ: CITY GYM..AND POOL SITE ACQUISITION. MINUTES PARK ACQUISITION AND, DEVELOPMENT COMMITTEE COMMUNITY SERVICES COMMISSION Tuesday, March 17, 1981; 6:30 a.m. Denny's.Restaurant, Beach and Ellis Huntington Beach, California Committee Present: Tom Cooper, Chairman; Glen Dysinger, Lee Mossteller, Bill.Osness (Ex-Officio) Staff Present: Vince Moorfiou.se, Norm Worthy The meeting was called to order by Chairman Tom Cooper at 6:45 a.m. and the agenda for the meeting was determined to be: 1).Review City Gym and Pool rehabilitation "Draft" report, 2) Review proposed capital improvements budget for 1981-82. City Gym and Pool Report Mr. Moorhouse indicated the report was prepared by staff for the purpose of providing adequate background information to support the staff position that the City Gym and Pool .783 acre site should be purchased by the City and that an allocation should be provided in the 1981-82 Park .Acquisition and Development Fund budget. Mr. Worthy stated the City is currently paying $1 per year for use of the land as per a. 20 year lease and that the City acquired the building in 1967 for $1.00 from the Huntington Beach City Elementary School District. Committee members indicated they had studied the report and they concurred that the gymnasium..site should be purchased by the city to give them control of the building's destiny. In that the lease will expire in 1987 and HBCES might want the land back at that time, the City could stand to lose the $1 million they have already invested into remodeling, maintenance and program operation as well as the anticipated $1 million they plan to expend on the building between now and 1987. MOTION: Mr. Mossteller moved the.Park Acquisition and Development Committee rec- commend that the Community Services Commission include the. in-house appraisal figure of $238,800 for acquisition of the .783 acre City Gym and Pool site in their . 1981-82 Park Acquisition and Development Fund budget. Motion seconded by Mr. Dysinger. MOTION CARRIED. . Capital Improvements Budget 1981-82 At the direction of the Community Services Commission, the committee members reviewed the Department preliminary Capital Improvements budget which is within the Park Acquisiton and Development Fund. Mr. Moorhouse indicated staff had substituted the acquisition of 16 acres of small lots within the Phase III area of Huntington. Central Park for the 10 acre Marion acquisition as the City Council was receptive to completing the consolidation of 25 acres of small lots north of Ellis between Golden West and Edwards Street and that they were willing to apply the 1980 parklands bond funds allocated to Huntington Beacli. to that project. He felt the Council would not act on the Marion property until the Ultrasysterns report was received and studied. He also ^. indicated that $238,800 for the acquisition of the .783 acre City Gym. and Pool site and f A' CHMENT 2 i ENCLOSURE — REQUEST FOR CITY COUNCIL ACTION SECTIONAL DISTRICT MAP .10-6—IIsu6J: CITY GY —«°°° Sa SITE ACMISITION CITY OF HUNTINGTON BEACH ORANGE COUNTY, CALIFORNIA USE OF PROPERTY MAP e1w GYM¢ Pool SATE ; 9 i - .• �JlOw`fN � f CF-R •0 :doOul ~ ON 11 f F4 ti . - Attachment 4 CITY OF HUNTINGTON BEACH INTER-DEPARTMENT COMMUNICATION HUNTINGTON BEACH To Charles W. Thompson From Dan T. Villella City Administrator Assistant Director of Finance Subject Proposed Acquisition of City Date April 24, 1981 Gym and Pool Site FIR # 81-48 In response to the request of the Community Services Department, I am hereby submitting a Financial Impact Report relative to the proposed funding necessary to acquire the City gym and pool site. An appropriation in the amount of $238,800 will be required to fund this acquisition. Sufficient funding is available in the Park Acquisition and Development fund for this purpose. Should the City Council choose to approve this purchase, and i.f the Huntington Beach City Elementary School Districtiis agreeable to the offering and to the land appraisal figure arrived at by the City's real estate appraiser, the balance in the Park Acquisition and Development fund would be reduced to $2,150,714.02. 1011 Dan T. Villella Assistant Director of Finance DTV/AR/cg CITY OF HUNTINGTON BEACH FINANCIAL IMPACT REPORT Project Name Acquisition of City Gym and Pool Site Description Proposed funding for the purchase of the City gym and pool site from- the Huntington Beach City Elementary School District. 1 . DIRECT PROJECT COSTS 1 . 1 One-Time Costs L5nd Furn. , aci i- Acquisition— Construction_ ties, Equipment Other Total Cost 238,800 238,800 1 .2 Recurring Annual Costs Additional. Materials & Outside —Payroll. Personnel Supplies Services Revenues Total Cost + + + 80,000+ 1 .3 Replacement/Renewal Costs N/A 2. INDIRECT .COSTS The analysis prepared by the Community Services Department indicates that the City has invested over one million dollars in the City gym and pool since 1968. It is contemplated that another one million dollars - including the purchase of the land - will be required to fund the City gym and pool operations through 1987, or through the end of the current lease. l� Financial Impact leport Page 2 3• NON-DOLLAR COSTS N/A 4. BENEFITS TO BE DERIVED FROM THE PROJECT City will be in control of i:ts destiny, so to .speak, and able to adequately plan for the future without the potential for the school district failing to renew the lease, or otherwise causing complications. 5. PROJECT USAGE Daily 6. EXPENDITURE TIMING - _ City Council approval of the acquisition concept will allow for serious negotiations to commence with the school district and the high probability chat an outside, independent appraisal will be required. 7. COST OF NOT IMPLEMENTING THE PROJECT School district may not desire to sell the land at a later date, or might demand a substantially higher price than the current market would justify.