LAKEPORT, Calif. – On Tuesday evening the Lakeport City Council voted down a staff proposal to form a commercial loan program funded by redevelopment funds.
The unanimous vote came after a discussion based on city Redevelopment Manager Richard Knoll's proposal to start the program.
“Basically this program is designed to provide access to redevelopment dollars that could be used to enhance commercial properties within the project area,” Knoll said.
Knoll cited concerns about the future of redevelopment, which Gov. Jerry Brown is proposing to eliminate as a budget saving measure.
Because the funds for the program were proposed to be based on redevelopment-derived tax increment revenue, Knoll said there was the possibility that the $300,000 a year that would be used for the program would take away from other projects.
The program would require an outside consultant to assist with the loan underwriting, with the loan then going to a loan committee and back to the council – which, sitting as the redevelopment agency's board of directors, would have the final say, Knoll explained.
Knoll said staff was proposing starting the program after the owner of the Vista Point Shopping Center – Matt Riveras, who Knoll did not specifically name – asked during talks with the city for a loan to improve the property.
“The Vista Point Shopping Center is an example of a blighted property within the project area,” Knoll said of the center, which is located on Lakeport Boulevard.
Council member Stacey Mattina asked about the improvements proposed for the center, the roof of which has been collapsed for several years over a center part of the building.
Knoll said the developer had indicated a desire to do a facade improvement on the east side of the center, not repairs on the main building. He added that city staff hadn't seen drawings of the proposed new facade.
When Mattina asked if the loan would be used to fix the major blight issue with the building, Knoll said no. He said city staff had expressed some concern to the developer.
“The blight is in that main portion of the shopping center where the roof has collapsed,” Knoll said. “Clearly that seems to be the highest priority.”
However, he said that's also the highest dollar amount to fix. “The developer has got a different approach.”
Knoll said the first step was for the council – sitting as the agency board – to determine if it wanted to form the loan program. He told the council that any commercial property within the redevelopment area would potentially be eligible.
Knoll said of the shopping center, “I think we all agree that there's a problem at that shopping center and that it reflects poorly on the community.”
That building, he noted, was identified among the priorities for the city's five-year redevelopment implementation plan.
Knoll said there is a shortage of capital right now. He said that, in almost every redevelopment project, the goal is to leverage funds and not to be the primary source of capital, but the secondary.
Mayor Suzanne Lyons was concerned about creating a program because someone was asking for a loan. Knoll said that staff had actually considered this kind of program in the past.
Mattina told Knoll she felt that it was strange timing to be starting the program, considering that redevelopment is up in the air. “So convince me that this is the right time to do this.”
As far as convincing the agency, Knoll said redevelopment “fundamentally is about eliminating blight and creating conditions within the community that are conducive to generating not only property taxes but sales taxes and other revenues.”
He said staff wasn't suggesting that the city was ready to fund a loan for the shopping center or any other loan program, but rather was bringing to them a program that staff felt would be beneficial in the long term.
City Manager Margaret Silveira, in response to a question from a council member, suggested that if the council did start the program it may be late in committing redevelopment funds. That's an important issue in relation to Brown's proposal to eliminate redevelopment, as the state wouldn't be able to take funds that already were committed to projects.
Knoll said the city's redevelopment legal counsel has urged against the redevelopment agency rushing into contracts just to project the funds. “We at the staff level pretty much concur with that.”
“We've got projects out there right now that need the money,” said Councilman Roy Parmentier.
Parmentier pointed out of the developer, “If he wants to fix his facades we have a program for it right now.” Knoll said that program has an upper limit of $25,000, which wouldn't go far on such a large project.
“If the project was going to start on the main eyesore, the collapsed roof, I'd jump on it,” said Councilman Tom Engstrom.
However, since that wasn't the case, Engstrom moved to direct staff not to proceed on the program.
The council voted 5-0 not to move forward.
In other business Tuesday, the council appointed Lynn Andre and Ron Bertsch to two-year terms on the Lakeport Parks and Recreation Commission, with Ann Blue, Suzanne Russell and Cindy Ustrud appointed to one-year terms on the commission.
Blue and Russell also were appointed to the Traffic Safety Advisory Committee, as were Kermit Knudson and Wally Cox.
Interim Finance Manager Dan Buffalo received the council's approval on an updated city policy on expenses and use of public resources, and the go-ahead to execute a contract with US Bank for the CAL-Card program, which he said city staff explored as a cost-saving measure.
City Manager Margaret Silveira told the council, “We're going to be eliminating a lot of the credit cards out there right now with this program,” referring to cards held by city employees.
The council also directed staff not to continue pursuing a plan for more parking near the Mendocino College Lake Center and Lake County Mental Health on Parallel Drive.
Ruzicka Associates, whose owners Cliff and Nancy Ruzicka also own the buildings at College Square where the college and mental health services are located, had been working with the city on parking and crosswalk proposals, but Engstrom, Parmentier and Rumfelt didn't feel it would be safe enough and voted against it.
E-mail Elizabeth Larson at
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