03-05-2002 RA RPT 06 - Laserfiche WebLink

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CITY OF RIVERSIDE AGENCY/COUNCIL MEMORANDUM People Serving People HONORABLE MAYOR, CITY COUNCIL AND AGENCY MEMBERS DATE: March 5, 2002 ITEM NO: 6 SUBJECT: APPROVE THE OPERATING AND USE COVENANT AGREEMENT WITH THE BUTTERFIELD LAND COMPANY - DOWNTOWN/AIRPORT INDUSTRIAL PROJECT AREA- FUNDS TRANSFER AND ADDITIONAL APPROPRIATION BACKGROUND: Superform USA, a Division of Luxfer, Inc., leases property from Butterfield Land Company to operate its business located at 6825 Jurupa Avenue, Riverside, California. Superform serves the aerospace industry, a primary customer, by manufacturing aircraft parts out of complex aluminum components from light, gauge sheet stock, and graphite composite. Their products are for both military and civilian application, including products for the automotive industry. Superform has entered into a lease with Butterfield Land Company to expand their existing business. The 20,000 square-foot expansion of Superform will include additional office and manufacturing space and will continue to provide the high tech jobs to the City as well as directly benefiting the Project Area with job retentionand job growth. It is the goal of both the Redevelopment Agency and the Economic Development Division to encourage and promote job retention and/or creation in the city of Riverside. CURRENTISSUE: In an effort to support the expansion of Superform USA in Riverside, the Development Department staff is requesting that operating and use covenants be purchased and recorded on the Butterfield property to assure that the site will continue to operate a business that will provide the high tech jobs as a result of the business expansion. The Redevelopment Plan encourages the preservation and expansion of manufacturing uses within the Project Area as a means to facilitating the reduction of blight. The continuance of such uses serves to maintain, and in some cases increase, the number of employment positions within the Project Area. In order to implement the Redevelopment Plan, staff has sought to obtain covenants from property owners that preserve certain properties for manufacturing uses, that encourage ongoing uses, and that facilitate the creation of jobs. The proposed Agreement with Butterfleld Land Company is a means toward those ends. Under the Agreement, the property owner will commit for a period of five years to dedicate the property to manufacturing use, that a manufacturing business operate on the property and that 68 employment positions be maintained and/or created within this period. These covenants represent restrictions that could not be required by the City dudng the land use entitlement review and approval process. In addition, the owner is offering to grant an Easement to the Redevelopment Agency for a possible monument sign to be installed in the future, including granting an Easement to the City of Riverside for public street purposes. Since these restrictions and Easement have a positive value to the Project Area, and since they can have a limiting effect on the site's resale value, staff and Butterfield Land Company have agreed that $57,000 represents a fair determination of the value to the Project Area and limiting impact on the property owner~ 6-1