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ITEM #25 <br />CITY OF COLTON <br />For the City Council and Redevelopment Agency Meeting of <br />September 16, 2008 <br />TO: Honorable Mayor and Councilmembers <br />Honorable Chairperson and Boardmembers <br />FROM: Candace E. Cassel, Economic Development Direct (r <br />_f <br />r <br />SUBJECT: Consideration and Approval of City Resolution and Agency <br />Resolution No. 877 Authorizing the Agency's Acquisition of <br />approximately 11.2 acres from the City and a Promissory Note for <br />the Acquisition of the Property. <br />DATE: September 9, 2008 <br />BACKGROUND <br />In August 1998, the City, the Redevelopment Agency for the City of Colton and East Valley <br />Land Company, EVLC approved Amendment No. 2, an amended and restated, Participation <br />Agreement for the purposes of constructing and installing public infrastructure and developing <br />approximate 75 acres within the Cooley Ranch Redevelopment Project. <br />Since that time, EVLC has developed the manufacturing/warehouse facility of Ashley Furniture, <br />Ashley Furniture Homestore, Canyon RV and Saddleback RV. In April 2004, the City of Colton <br />acquired the remaining vacant 11.2 acres for the purposes of constructing a Big League <br />Dreams sport complex for approximately $2.4 million. Unfortunately, escalating costs for the <br />Big League Dream project prohibited the construction of the facility and the project was <br />abandoned. <br />Over the past several years, the Agency and EVLC have discussed the possibility of entering <br />into an Exclusive Negotiating Agreement for the development of the site into a mutually <br />agreeable use. EVLC has identified a potential user and an ENA with the Redevelopment <br />Agency is being prepared. As part of that process, the Agency needs acquire to the property in <br />order to negotiate for the potential sale and redevelopment of the site with EVLC. It is <br />anticipated that an ENA will be brought back before the Agency Board within the next several <br />weeks. <br />Based upon an appraisal conducted in March of 2007, the City is proposing to sell the <br />approximately 11.2 acres to the Agency for $4,900,000. Terms of the agreement include <br />execution of a promissory note with the City that will be paid upon the Agency's sale of the <br />property to a developer and/or through the use of the 2008 bond proceeds that the Agency has <br />been contemplating. <br />FINANCIAL IMPACT <br />Under the proposed terms, the Agency will acquire the approximate 11.2 acres for $4.9 million <br />