09/15/2008
CITY COUNCIL WORKSESSION MINUTES
CITY OF CLEARWATER
September 15, 2008
Present: Frank Hibbard Mayor
George N. Cretekos Vice-Mayor
John Doran Councilmember
Carlen Petersen Councilmember
Paul Gibson Councilmember
Also present: William B. Horne II City Manager
Jill S. Silverboard Assistant City Manager
Rod Irwin Assistant City Manager
Pamela K. Akin City Attorney
Cynthia E. Goudeau City Clerk
Patricia O. Sullivan Board Reporter
The Mayor called the meeting to order at 1:30 p.m. at City Hall.
To provide continuity for research, items are in agenda order although not
necessarily discussed in that order.
Presentations
Service Awards
One service award was presented to City employees.
The September-October 2008 Team Award was presented to Container Maintenance A
Team, Thomas Wilcox, Anthony Fanelli, John Garakop, and Robert Lillico.
Police Recruit Swearing In
The City Clerk administered the Oath of Office to four Police Recruits.
The Council recessed from 1:34 to 2:00 p.m. to meet as the Community Redevelopment
Agency and Pension Trustees.
Police
Approve assignment of the Hispanic Outreach Center Lease Agreement with YWCA of Tampa
Bay to Pinellas Core Management Services, Inc.; terminate YWCA contracts providing 1)
Operacion Apoyo Hispano services, 2) Human Trafficking advocacy services and 3) Human
Trafficking Immersion training and approve contracts with Pinellas Core Management Services
to provide these services using funding remaining in the 2006 Edward Byrne Memorial Justice
Grant, the 2006 Bureau of Justice Assistance Grant for Human Trafficking and the 2008 Bureau
of Justice Human Trafficking Immersion Learning Grant and authorize the appropriate officials
to execute same.
Council Work Session 2008-09-15 1
On September 11, 2008, the Juvenile Welfare Board (JWB) voted to transfer JWB-
funded programs related to the Clearwater Hispanic Outreach Center in the amount of $278,760
from the YWCA of Tampa Bay to Pinellas Core Management Services, Inc. (PCMS) effective
October 1, 2008. This JWB funding was the primary funding source for programs associated
with the YWCA Hispanic Outreach Center partnership with the City. Without this funding, the
YWCA cannot maintain the programs at the Hispanic Outreach Center. The YWCA has agreed
to transfer all remaining program leases, grants and contracts to PCMS in order to preserve the
existing programs and services provided by the Hispanic Outreach Center.
The City currently has one lease and three grant-funded contracts with the YWCA of
Tampa Bay including: 1) The land lease ($1/per year) for the Hispanic Outreach Center facility,
which expires November 2009; 2) The $66,807 2006 Edward Byrne Memorial Justice
Assistance Grant contract with a remaining balance of $45,000 which funds advocacy,
interpretation, translation of documents, and crime prevention/education activities; 3) The
$45,000 2006 Bureau of Justice Assistance Grant for Human Trafficking services with a
remaining balance of $15,000, which funds training, advice and counseling to human trafficking
victims, interpreter services, document translation, and participation in the task force coalition,
partial payment of the balance of the salary and FICA for the full-time human trafficking case
management position; 4) The 2008 Bureau of Justice Assistance Human Trafficking Immersion
Learning contract valued at $13,100 which will fund contractual services for planning/
participation and equipment related to immersion training sessions for selected visiting Human
Trafficking Task Forces;
It is anticipated that all six existing Hispanic Outreach Center staff (currently employees
of the YWCA) will become the employees of PCMS and will remain with the program. It is the
intent of PCMS, the YWCA, and the City to maintain all existing Hispanic Outreach programs
and services through a relatively seamless transfer of funding. It is the City’s intent that most
clients will not notice the change. JWB and City staff are extremely supportive of the award-
winning programs that are occurring at the Hispanic Outreach Center. This transition should not
be interpreted in any way as a reflection on the quality and effectiveness of the programs
offered. This is a funding transfer only.
PCMS, the Hispanic Outreach Center, and the City desire ultimately to create a separate
501(c)(3) organization for the Hispanic Outreach Center programs. This process, which may
take several months, will begin soon after the transfer of funding to PCMS. It is envisioned that
PCMS will nevertheless remain as the parent administrative services organization for the
foreseeable future.
There also exists a Community Development Block Grant (CDBG) from the City to the
YWCA for $15,000, effective October 1, 2008, to fund operating costs and salary support to the
Hispanic Outreach Program. Due to HUD restrictions, this grant cannot be transferred to
PCMS. JWB intends to cover this shortfall with other funding they have available. There is no
cost to the City for these proposed transfers, nor does the City’s obligations to the Hispanic
Outreach Center programs change.
Disappointment was expressed that JWB had discontinued funding for the YWCA, which
was thanked and congratulated for their efforts. Deputy Police Chief Dewey Williams said the
City receives other program grants and contracts related services. Staff had considered
Council Work Session 2008-09-15 2
alternatives. The JWB representative said PCMS provides administrative services for some
smaller JWB funded organizations, allowing them to focus on providing services.
Planning
Approve a Zoning Atlas Amendment from Business (B) District to the High Density Residential
(HDR) and Preservation (P) Districts for property located at 1170, 1180, 1200, and 1226 Gulf
Boulevard (consisting of a portion of Sec. 17-29-15 in Metes and Bounds 33/021 and Pass
Ordinance 7976-08 on first reading. (REZ2008-05003)
This Zoning Atlas Amendment application involves one property of approximately 13.52
acres in area located on the northwest side of Gulf Boulevard, approximately 2,270 feet south of
Clearwater Pass Bridge. This property has FLUP classifications of Resort Facilities High (RFH)
and Preservation (P) and a zoning designation of Business (B). The City dissolved the B
District in 1972. The B designation was the result of a lawsuit settlement stipulation of October
17, 1986 and expired on October 17, 2006. In effect, there is no zoning on the property and the
applicant is requesting to amend the Zoning Atlas from the B designation to the High Density
Residential (HDR) and Preservation (P) designations.
The Planning Department determined that the proposed rezoning application is
consistent with the following standards specified in the Community Development Code: 1) The
proposed rezoning application is consistent with the Comprehensive Plan; 2) The proposed use
is compatible with the surrounding area; 3) Sufficient public facilities are available to serve the
property; 4) The applications will not have an adverse impact on the natural environment; and 5)
The district boundaries are appropriately drawn.
Assistant Planning Director Gina Clayton said this property will be non-conforming as to
density. The property previously was governed by a settlement related to its use that no longer
exists under the Land Use Plan. Staff would advise the property owner to file a termination.
Short-Term Rental Policy Update (WSO)
The City of Clearwater took the position in the Allbritton v. City litigation that short-term
rental use had always been prohibited within residential zoning districts of the City. With Final
Judgment having been entered against the City in the case, upheld without opinion on appeal,
the “law of the Circuit” in the Sixth Judicial Circuit is currently that such use in Clearwater, where
proven to have been established prior to the adoption of Ordinance 7105-03, may be allowed to
continue and run with the land as a legal nonconforming use.
Presumably, those property owners who could demonstrate similar factual
circumstances to the Circuit Court would obtain an identical judicial ruling. Given this
background, the City has determined to allow property owners to apply through the
administrative interpretation process referenced in Community Development Code, Article 5,
Division 7, for an interpretation as to whether they are entitled to such status. Such a process
has the advantages of fitting within the City’s existing Code framework, potentially saving
litigation costs, and providing relief for code enforcement resources. An interpretation by the
Community Development Coordinator is subject to appeal under Section 4-501A.1. to the
Community Development Board.
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The Community Development Coordinator will consider the following criteria in making
an interpretation as to whether a particular short-term rental use constitutes a legal
nonconforming use in a residential zoning district: 1) Length of use: property must have been
rented on short-term basis prior to the adoption of Ordinance 7105-03; 2) Frequency and
continuation of use: there must not have been a discontinuance or abandonment of the use for
six consecutive months. See Section 8-102, definition of “abandoned building” and other
applicable definitions; Section 6-103, Nonconforming Uses, Subsection D; 3) Documentation
must be submitted of registration of use with State and County and payment of applicable state
and county taxes for use; and 4) Property must not have been, or become, ineligible for
homestead status under Florida Statutes Chapter 196 during period of use.
The Coordinator shall review information submitted by the property owner and available
to the City, including whether the applicant meets the above criteria, in making an interpretation
as to legal nonconforming use status, also including the following: Documentation of use
through one or more of the following: rental contracts; realtor listings; evidence of payment/
receipts; correspondence with renters; affidavit of property owner or others; other evidence.
Observations of, and results of investigation by, City staff as to use, e.g., traffic/parking, contact
with property owner. There is currently no charge for Administrative Interpretations under
Community Development Code, Appendix A., Section VIII, Land Development. Staff will
process a Code amendment adding a line item with fee to this Section, and will develop a
corresponding application form.
The City Attorney said the CBA (Clearwater Beach Association) had requested
additional time before City Council action. It was stated that rules need to be enforceable and
neighbor expectations must be realistic. Planning Director Michael Delk said permits will not be
issued until City policy is formalized.
CBA President Jerry Murphy said the CBA had met with staff to develop a process. He
supported reducing the number of short-term rental properties and requiring property owners to
maintain their short-term rental status or lose it.
City Manager
Report on negotiations regarding public - private beach parking garage.
Chase assemblage #4 east of Coronado (0.7 acre) - Financial Summary: City would
borrow approximately $3.9 million and fund approximately $9 million from reserves to make sure
that the project revenues would be greater than estimated expenditures (including a structural
maintenance reserve) and still generate a reasonable net profit. Funding from reserves could
come from the $6 million set aside in a project as well as an additional $3 million from the
Parking Fund undesignated reserves, which currently exceed $10 million. Staff has not
included the cost of reinforcement for expansion in these amounts.
Advantages: 1) City would own the land & the structure; 2) City controls design and
construction process; 3) Provides more north-south disbursement of parking as opposed to
concentrated in one area; 4) 15-foot setback from Coronado & 12-foot from Hamden will provide
Beach By Design landscaping and architectural treatment opportunities; 5) Design features/
amenities (i.e., bike racks, sand rinse off area, holding area for beach accoutrements, etc.)
could be incorporated into design; 6) Choice of one or two separate entrances (Coronado/
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Hamden); 7) Could close Coronado entrance depending on impact to traffic flow (would gain
five additional parking spaces); 8) All egress is on Hamden; 9) User friendly (i.e., no large ramps
to navigate, elevator lobby area defined, etc.); 10) Stairwells at NW & SE corners for
convenience.
Disadvantages: 1) A parking garage with 300 spaces could generate anywhere from 300
to 1,200 pedestrians per day crossing Coronado Drive between Second and Fifth streets. This
could have a major impact on the LOS (Level of Service) of Coronado Drive (40,000 vpd peak,
20,000 vpd off-peak) as this number of pedestrians is concentrated in a small section of
roadway rather than distributed over the entire beach. This could necessitate the installation of
a signal at Second Street, and possibly pedestrian signals at Brightwater Drive and midblock
between Brightwater and Second Street. This does not count the already identified signal that
will probably be needed at Fifth Street for general traffic control in the not too distant future. The
more signal density on a segment of road the lower the LOS. The impact to this traffic flow of
safely crossing this many pedestrians per day may be significant in terms of delay and
congestion and counterproductive to the intent of Coronado’s function in Beach by Design, as it
is also the main access route for the residents on Sand Key as well as the residents on the
south end of the beach; 2) Access to this garage would have to be made by southbound left
turns across opposing traffic from the center lane of Coronado Drive and/or from Hamden Drive
on the east side of the garage via southbound left turns from Coronado Drive onto Devon Drive
against opposing northbound traffic; 3) Requires five levels to accommodate 272 parking
spaces; 4) Future upward expansion of this garage to more than 300 spaces would pose
problems, as the garage would have to be closed during construction.
Chase assemblage #5R east of Coronado (1.0 acre) - Financial Summary: City would
borrow approximately $3.9 million and fund approximately $10.2 million from reserves to make
sure that the project revenues would be greater than estimated expenditures (including a
structural maintenance reserve) and still generate a reasonable net profit. Funding from
reserves could come from the $6 million set aside in a project as well as an additional $4.2
million from the Parking Fund undesignated reserves, which currently exceed $10 million. Staff
has not included the cost of reinforcement for expansion in these amounts.
Advantages: 1) City would own the land & the structure; 2) City controls design and
construction process; 3) Provides more north-south disbursement of parking as opposed to
concentrated in one area; 4) 15-foot setback from Coronado & 12-foot from Hamden will provide
Beach By Design landscaping and architectural treatment opportunities; 5) Design features/
amenities (i.e., bike racks, sand rinse off area, holding area for beach accoutrements, etc.).
could be incorporated into design; 6) Choice of one or two separate entrances (Coronado/
Hamden); 7) Could close Coronado entrance depending on impact to traffic flow (would gain
five additional parking spaces); 8) All egress is on Hamden; 9) User friendly (i.e., no large ramps
to navigate, elevator lobby area defined, etc.); 9) Stairwells at NW & SE corners for
convenience; 10) Requires only four levels to accommodate 292 parking spaces; and 11) Site
has the best square-foot per parking space efficiency ratio.
Disadvantages: 1) A parking garage with 300 spaces could generate anywhere from 300
to 1,200 pedestrians per day crossing Coronado Drive between Second and Fifth streets. This
could have a major impact on the LOS of Coronado Drive (40,000 vpd peak, 20,000 vpd off-
peak), as this number of pedestrians is concentrated in a small section of roadway rather than
distributed over the entire beach. This could necessitate the installation of a signal at Second
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Street, and possibly pedestrian signals at Brightwater Drive and mid-block between Brightwater
and Second Street. This does not count the already identified signal that will probably be
needed at Fifth Street for general traffic control in the not too distant future. The more signal
density on a segment of road the lower the LOS. The impact to this traffic flow of safely
crossing this many pedestrians per day may be significant in terms of delay and congestion and
counterproductive to the intent of Coronado’s function in Beach by Design, as it is also the main
access route for the residents on Sand Key as well as the residents on the south end of the
beach; 2) Access to this garage would have to be made by southbound left turns across
opposing traffic from the center lane of Coronado Drive and/or from Hamden Drive on the east
side of the garage via southbound left turns from Coronado Drive onto Devon Drive against
opposing northbound traffic; 3) Site costs $700,000 more than site #4; 4) Site contains an
approximately 16-foot by 110-foot area which is not usable for the garage; 5) Future upward
expansion of this garage to more than 300 spaces would pose problems, as the garage would
have to be closed during construction.
Britts (Surf Style) Condo Purchase Option - Financial Summary: City would borrow
approximately $3.9 million and fund approximately $12.7 million from reserves to make sure that
the project revenues would be greater than estimated expenditures (including a structural
maintenance reserve) and still generate a reasonable net profit. Funding from reserves could
come from the $6 million set aside in a project as well as an additional $6.7 million from the
Parking Fund undesignated reserves, which currently exceed $10 million. Includes the cost of
reinforcement for expansion in that 200 additional spaces are being built at the same time,
which can be purchased for an additional $4 million (adjusted by CPI) after five years.
Advantages: 1) Eliminates problem with pedestrians crossing Coronado Drive to get to
the beach; 2) Provides for smooth entry into the garage via a decel lane on Coronado Drive as
opposed to queuing in the continuous left turn lane on Coronado Drive and turning left against
opposing northbound traffic; 3) Fits the vision of Beach Walk as the day-trippers who use this
garage would be able to immediately access Beach Walk and use the promenades and
pedestrian facilities already planned and implemented for the beach-goer to get to the sand.
There is a crosswalk in the Beach Walk development directly in front of the Britts site for access
to the beach; and 4) Provides for already constructed future expansion of an additional 200
spaces, which the City can purchase after five years.
Disadvantages: 1) The City does not have complete control of the design, owners may
not be receptive to the City’s level of design features/amenities requested (i.e., bike racks, sand
rinse off area, holding area for beach accoutrements, etc.); 2) 14% ramp slope – very steep
(Ground level to level two), which exceeds City’s proposed code revisions (not to exceed 12%);
3) Down Ramp to exit – dangerous with 90-degree turn at base of 14% slope; 4) Would not own
and would have to rely on owners for structural maintenance and repairs & unclear what those
costs would be; 5) Elevators are not as visible on the lower levels due to the retail/restaurant
use – could cause user confusion; 6) Not much space for Beach By Design treatments,
landscaping or amenities; 7) Worst square-foot per parking space efficiency ratio; 8) Hyatt
public parking ingress/egress driveway for 400 public spaces is located immediately north of this
site abutting the level one parking & delivery truck ingress/egress – possible impact to traffic
flow; and 9) Developers request that City fund construction might be problematic.
Britts (Surf Style) Lease Option - Financial Summary: City would need to reserve
approximately $13 million, which together with interest generated from this reserve would cover
Council Work Session 2008-09-15 6
the expected annual net loss over the 30-year lease (including a reasonable annual buffer and
structural maintenance reserve). Funding of this reserve could come from the $6 million set
aside in a project as well as an additional $7 million from the Parking Fund undesignated
reserves, which currently exceed $10 million. There is an option to purchase the garage at the
end of 30 years at fair market value if the City pays a $2 million non-refundable deposit up front.
This cost has not been included in this analysis.
Advantages: 1) Eliminates problem with pedestrians crossing Coronado Drive to get to
the beach; 2) Provides for smooth entry into the garage via a decel lane on Coronado Drive as
opposed to queuing in the continuous left turn lane on Coronado Drive and turning left against
opposing northbound traffic; 3) Fits the vision of Beach Walk as the day-trippers who use this
garage would be able to immediately access Beach Walk and use the promenades and
pedestrian facilities already planned and implemented for the beach-goer to get to the sand; and
4) There is a crosswalk in the Beach Walk development directly in front of the Britts site for
access to the beach.
Disadvantages: 1) The City does not have complete control of the design, owners may
not be receptive to the City’s level of design features/amenities requested (i.e., bike racks, sand
rinse off area, holding area for beach accoutrements, etc.); 2) 14% ramp slope – very steep
(Ground level to level two) - exceeds City’s proposed code revisions (not to exceed 12%); 3)
Down Ramp to exit – dangerous with 90-degree turn at base of 14% slope; 4) Would not own
and would have to rely on owners for structural maintenance and repairs & unclear what those
costs would be; 5) Elevators are not as visible on the lower levels due to the retail/restaurant
use – could cause user confusion; 6) Not much space for Beach By Design treatments,
landscaping or amenities. The above items reflect the possibility that this garage may not
provide the quality desired; and 7) Worst square-foot per parking space efficiency ratio; 8) Hyatt
public parking ingress/egress driveway for 400 public spaces is located immediately north of this
site abutting the level one parking & delivery truck ingress/egress – possible impact to traffic
flow.
Assistant City Manager Rod Irwin said staff developed a comparative analysis of current
proposals after meeting with the Surf Style property owner. Also last week, the primary lenders
for the Lucca property submitted a letter of interest to sell that property to the City. Florida Main
Street LLC, a Sarasota mixed-use parking firm, submitted an unsolicited proposal to construct a
design-build project on the Lucca property, should the City acquire it.
Finance Director Margie Simmons reviewed the financial analysis and need to issue 20-
year bonds. The City could pay off $3.9 million from garage cash flow. Parking reserve funds
would provide $12.7 million. For the Surf Style project, the City would have to fund $13 million
and sign a 30-year lease, which would be subject to property taxes. Surf Style would take a risk
by constructing additional parking. Mr. Irwin said further negotiations are possible. Surf Style
proposes that the City fund the project with an interest free loan. The analysis did not include
costs to purchase additional parking spaces in the future. Adding parking spaces to a City
garage would close it for up to 18 months. Parking Facilities Manager Tracey Bruch said Surf
Style’s location is great but its footprint is tight.
Traffic Operations Manager Paul Bertels said a Gulfview entrance would impede traffic.
While a parking garage on the west side of Coronado would be preferable for pedestrian traffic,
pedestrian signals could be installed for a mid-block garage east of Coronado. Concern was
Council Work Session 2008-09-15 7
expressed that pedestrian signals would hinder through traffic and parking garage traffic would
clog Coronado, impacting new resorts. Mr. Bertels said Coronado was envisioned as the major
th
traffic carrier on south beach. An additional traffic signal is planned at 5 Street.
It was stated parking spaces are expensive and would often be empty. The City
Attorney said under certain conditions, the Marina location would be an exception to Hyatt
parking agreement restrictions, which expire five years after the CO (Certificate of Occupancy),
anticipated for December 2009. A City parking garage could not be completed before that date.
Ms. Bruch said while the City lost almost 500 parking spaces to the Beach Walk project, the
Hyatt will replace 425. It was noted the City had replaced many spaces at temporary lots, and
additional spaces soon will be available.
Discussion ensued regarding a parking garage on City-owned properties, with opposition
and support expressed to a beachfront location and concern expressed that Marina access
would be problematic and obstruct roundabout traffic. City Engineer Mike Quillen said
pedestrian beach access would be the Marina location’s greatest difficulty.
Discussion ensued regarding the Lucca site and acquisition complications related to
foreclosure proceedings. It was felt that property prices are not quickly rebounding. It was
commented that working out details on the Surf Style property would take time and the Lucca
property’s asking price is similar to others. The City Attorney said the City would have to limit its
negotiations if it enters into a contract contingent on foreclosure of the Lucca property. Mr.
th
Quillen said that site’s location would allow parking garage traffic to enter and exit onto 5
th
Street and pedestrians to congregate at the 5 Street traffic signal, cross Coronado, and
disperse onto the beach.
It was stated parking reserve funds came from people who parked at the beach. It was
indicated that the City builds many things used by people living outside of Clearwater, such as
Beach Walk, which needs parking. It was stated that parking needs to be spread throughout the
beach and never will be sufficient on peak days. The City Attorney said the City does not have
appraisals for any of the sites. Staff will talk with Lucca property representatives about reducing
the property’s price in exchange for development rights, which Mr. Delk estimated at 78 units.
Consensus was to eliminate the Surf Style proposal from consideration due to its higher
costs.
Legal
Adopt Ordinance 7997-08 on second reading, amending the Community Development Code to
adopt criteria by which sandwich board signs may be permitted in certain areas, providing a fee
for such signage, and making other minor editorial changes.
The Planning Department is recommending amendments to the Community
Development Code (CDC) to address code compliance issues with sandwich board signs in the
Downtown (D) District. At the prior direction of City Council, staff has drafted this ordinance to
allow sandwich board signs to be present on a temporary basis (not to exceed one-year) in
order to promote economic development in this developing area. The proposed amendment will
establish sandwich board signs as a permitted sign requiring development review and put in
place criteria, including requirements on the location and design of the signs.
Council Work Session 2008-09-15 8
Among these criteria are the following: 1) Sandwich board signs may be displayed on
the sidewalk only during hours of operation of the business and within the linear frontage of the
specific business location being advertised. Under no circumstance shall the sandwich board
sign be stored exterior to the business location; 2) The size of any sandwich board sign shall not
exceed 42 inches in height, 20 inches in width; 3) No sandwich board sign shall be placed so as
to block any public way, or within the visibility triangle of intersections or driveways. Placement
may not reduce sidewalk width to less than four feet clear area. Placement may not impede
ingress or egress from a business entrance nor block access or visibility of a fire hydrant; 4) The
sandwich board sign shall be of a non-illuminated, freestanding, two-sided design comprised of
metal, wood or synthetic materials such as chalkboard. The sign shall not be made from plastic
or use plastic lettering, and shall not include a whiteboard; 5) The sandwich board sign shall be
professionally designed and may use shapes and forms indicative of the type of business and
the services being advertised; however such signs may not include sponsorships or
advertisements for products; 6) Design must be reviewed and approved before placement.
Placement prior to approval will not necessitate approval of the application as submitted; and 7)
The sandwich board sign may not be attached to any structure or pole, and may not include any
moving parts or attachments, including but not limited to: balloons, pennants and streamers.
However, attachable items such as a removable chalkboard, that is intended to be an integral
part of the sign and is not precluded by any other of these criteria, may be permitted.
The ordinance will also add a definition for the term "traditional urban corridor," which is
used in the sandwich board sign criteria, and establish a fee for the sandwich board sign permit.
The CDB reviewed the proposed text amendment at its pubic hearing of August 26, 2008. The
recommendation of the CDB as well as any comments of the Board will be presented to the
Council at the meeting.
Mr. Delk said a fact sheet lists sandwich board sign restrictions. Businesses will have 30
days to comply after adoption of the ordinance. Sandwich board signs will be permitted in urban
development areas of downtown, in front of businesses not eligible for freestanding signs.
Royalty Theater
The City Attorney said a draft Ruth Eckerd Hall Royalty Theater Memorandum of
Understanding had been received.
“This Memorandum of Understanding is made and entered into this _______ day of
September, 2008, between the City of Clearwater, a municipal corporation of the State of
Florida, hereinafter referred to as the ("City") and Ruth Eckerd Hall, Inc. a Florida nonprofit
corporation, hereinafter referred to as ("Ruth Eckerd Hall").
This Memorandum of Understanding is entered into by the City and the Corporation for
the purpose of formalizing the intent of the Parties relating to the responsibilities and obligations
regarding the purchase, rehabilitation, operation and maintenance of the Royalty Theater and
the Lokey building (403 and 401 Cleveland Street).
It is the intent for Ruth Eckerd Hall to eventually take on the responsibility of the
renovation and operation of the Royalty Theater. To that extent: 1) The City will assume the
purchase contracts for the 403 (purchase price of $1.1 million dollars) and 401 (purchase price
Council Work Session 2008-09-15 9
of $1.5 million dollars) Cleveland Street and will purchase said properties and cover all closing
costs; 2) The City and Ruth Eckerd Hall will develop lease and management agreements similar
to the existing agreement for the operation of Ruth Eckerd Hall recognizing however that it is not
the intent that the City subsidize the ongoing operations of the Theater following rehabilitation of
the facility; 3) Ruth Eckerd Hall estimates the total project cost to be $14.5 million broken down
as follows: $2.7 million for purchase and closing costs, including Ruth Eckerd Hall out of pocket
due diligence expenditures ($13,920.00), $6.8 million for construction and renovation and $5
million for an endowment fund; 4) Ruth Eckerd Hall Boards have voted to move forward with a
campaign to raise $8 million of the $14.5 million needed for this project. Ruth Eckerd Hall’s $8
million commitment is contingent upon a total City/public commitment $6.5 million toward the
project; 5) Ruth Eckerd Hall and the City will work cooperatively to identify and obtain other
public funding sources of $3.8 million, which will reduce the City’s contribution toward the
construction and renovation, beyond the initial purchase price and closing costs of $2.7 million;
6) In addition, presenting some performances in the Capitol/Royalty Theater during the pre-
construction period will help generate interest in the project. During the pre-construction period,
Ruth Eckerd Hall will lease the facility from the City for $1.00 for each use. Ruth Eckerd Hall will
be responsible for all costs associated with each event, including staffing, set up and clean up.
The net profit for each event will be split equally between the City and Ruth Eckerd Hall. The
City will assist Ruth Eckerd Hall in getting the facility ready use prior to commencement of
remodeling. The City will advance/provide funding following closing not to exceed $250,000 (to
be netted from the above cost estimates from the City’s/public funding total of $6.5 million) for
cleaning the theater, clearing the theater of unwanted and unnecessary debris and clutter,
purchasing stage, lighting, sound and projection equipment and other necessary items to
ensure a comfortable and safe environment with adequate equipment to be able to mount
performances. Equipment purchased would be able to be used in the final project. Ruth Eckerd
Hall would carry appropriate insurance up to entertainment and performing arts industry
standards for such use of the theater and shall indemnify and hold harmless the City for any
losses that occur as a result of Ruth Eckerd Hall’s use of the theater; 7) It is estimated that it will
take a minimum of two and a half years to raise the $8 million noted in number 4, commission
construction drawings and complete the renovation and construction of the facility; 8) The City
will work with Ruth Eckerd Hall to vacate the alleyway behind the Capitol/Royalty Theater to
allow for expansion of the stage house by the time construction is to commence. The Parties
recognize that there are factors outside of City control that affect the vacating. In the event the
alley cannot be vacated, it is the intent of the Parties to move forward with the rehabilitation
under a modified plan; 9) Ruth Eckerd Hall will accept responsibility for the construction and not
seek any additional funding beyond what is stated in this document for the construction and
renovation of the theater and the adjacent building; 10) In raising endowment funds, it is the
intent for Ruth Eckerd Hall to operate the facility without any ongoing annual subsidy from the
City; 11) Until such time as Ruth Eckerd Hall is ready to commence the construction and
renovation of the facility and execute a lease/management agreement, the City shall be
responsible for any monthly operating costs, which is expected to be minimal (utilities - electric,
water, sewer, minor maintenance and insurance); 12) Rent (at this time approximately $5,500
per month in a triple net lease) collected from the tenant that occupies 401 Cleveland Street
shall be paid to and retained by the City commencing as of closing; 13) Once renovation of the
Capitol Royalty Theater is complete, Ruth Eckerd Hall will be responsible for the ongoing annual
maintenance for the normal operation of the facility including, but not limited to normal wear and
tear for sound, lighting and theatrical equipment, theater seating, electrical and HVAC.”
Council Work Session 2008-09-15 10
The City Attorney said the second property appraisal was substantially lower than the
first. Concern was expressed that the first appraisal contained many errors. As the second
appraisal was higher than the tax assessment, it was recommended the City negotiate a lower
price and not overpay.
Ruth Eckerd Hall representative Robert Freedman said as proposed, the City would pay
$1.5 million for the two buildings and the seller would pay $100,000 towards closing costs. He
said the due diligence period ran through October 10, 2008, and could be extended with an
additional, non-refundable payment of $40,000. It was felt that Ruth Eckerd Hall should refuse
to pay for an extension, as there was no other interest in the property. Mr. Freedman said on
Thursday, he will report on a meeting with the property owner. Ms. Simmons said the City could
use Special Development Fund money for the purchase. Use of Penny for Pinellas funds would
require a public hearing. As proposed, renovations would be funded by the Central Insurance
fund. The City has General Fund debt for the Police building and Beach Walk.
City Manager Verbal Reports
Council Discussion Items
Sandwich Boards on the Beach
Discussion ensued regarding the request to permit sandwich board signs on the beach.
Consensus was to uphold sandwich board sign restrictions on the beach.
Other Council Action
Councilmember Cretekos questioned when board member appointments to the MAB
(Marine Advisory Board) would be on the agenda. City Clerk Cyndie Goudeau said she would
contact the Marine & Aviation Department and report on Thursday the status of a proposed
requirement that MAB members represent specific categories.
Councilmembers Cretekos and Petersen will not attend the September 29, 2008, Work
Session.
Adjourn
The Work Session adjourned at 4:41 p.m.
Council Work Session 2008-09-15 11