CLEARLAKE, Calif. – During a special meeting last week, the Clearlake City Council voted to sell the former Austin Resort property to a developer.
Meeting for about a half-hour on Wednesday morning, the council offered unanimous approval for the plan, which Vice Mayor Dirk Slooten estimated will be a $40 million project.
This spring, Bailey Building and Loans LLC approached the city with a proposal to purchase the property, consisting of two parcels, in order to build a destination resort at the site that would include a marina, hotel, restaurant and retail.
The council approved an initial letter of intent with the developer in March, and it has since received approval from the Clearlake Planning Commission, as Lake County News has reported
The property is made up of two parcels. The first is the 4.74-acre parcel located at 14061 Lakeshore Drive and owned by the city’s redevelopment successor agency since 1997. The second property, located at 14071 Lakeshore Drive, is 2.94 acres and owned by the city since 2001, when it purchased it from the Redevelopment agency.
City Manager Alan Flora said the purchase price for both properties will be $915,350.
The larger parcel at 14061 Lakeshore Drive, held by the redevelopment successor agency, will sell for $564,943, and 15.73 percent of the proceeds, or $88,815, will go to the city. Other taxing entities will split up the remaining funds. Flora’s report said the largest amount, or $252,534, will go to Konocti Unified School District.
The parcel at 14071 Lakeshore Drive, is priced at $350,407, all of which will go to the city, Flora said.
Among the items Bailey Building and Loans LLC is requesting of the city, it’s asking for the city to coordinate with tribal governments as necessary; build a roundabout at the intersection of Olympic and Lakeshore drives, in partnership with developer for property frontage improvements; that the police department would identify the property as a priority for law enforcement visibility and enforcement; that the city would take all reasonable efforts to ensure expedited entitlement approval process; and that the city would consider a lease or license agreement for adjoining property that would facilitate infrastructure improvements to reflect and unified project image, while maintaining public access.
The developer’s responsibilities including developing a waterfront resort including a hotel, restaurant, marina and other services; maintaining public access to the waterfront of Clear Lake in perpetuity; perform desired due diligence of property including any requests to city for data; and work collaboratively with the police department in identifying processes and equipment that continue the decrease in crime within the city.
Flora noted that when the council had discussed the letter of intent earlier this year, it had given direction to make sure that if the project stole the city would have the opportunity to get ownership of the property back.
As such, the developer has agreed to a three-year timeline; if they haven't started construction within three years of closing the sale the city would have the opportunity to purchase the property back for the sale price.
Flora said the project will be a fairly complicated one, particularly because of the developers’ interest in doing a large marina which will require both permits through the California Department of Fish and Game and the U.S. Army Corps of Engineers. He said permits through the Army Corps can take up to two years.
Flora said the Redevelopment Agency Oversight Board is due to meet on June 8 to consider approving sale of the property owned by the successor agency.
Once the oversight board and council had given approval, Flora said city staff would finalize the sale agreement with the developer and begin working on the terms of a development agreement any other issues needed in order to close escrow within 120 days.
Slooten said he thought it was an exciting time, explaining that based on the estimated size of the project you could cost $40 million to build. He said he also thought it was reasonable to include the three-year time frame to start construction considering environmental review and other requirements that they will face.
Mayor Russ Cremer said he, Slooten and Flora had been in an initial meeting with the developers. He said the project will transform the city landscape along with a newly redeveloped Austin Park.
Cremer asked about a lease agreement the developer is requesting for Austin Beach. Flora explained that the developer had wanted to buy the beach but instead has agreed to a staff proposed lease agreement for the beach.
Flora said the developer is interested in making the beach appear to be part of the resort development and would like to make improvements to it including to the short wall along the sidewalk.
Councilman Phil Harris said at resorts he’s visited he’s seen them utilize and work to maintain public beach space, and he said it would be a huge benefit to the city to have the developer helping with Austin Beach.
He said he also wanted to see the project include a celebration of local Native American culture, such as a stature.
Flora said he thought it was a great idea, and he noted that the developers seem sensitive and interested in the local Native American history and have asked the city to help them work with the local Native American tribes on this project.
“I think that's a great suggestion and I think it's pretty likely to be part of the project,” Flora said.
Cremer asked Police Chief Andrew White if he foresaw any difficulties responding to the developers’ request that the police department make the property – located across from City Hall – a priority for law enforcement visibility and enforcement.
White said no, that he didn’t foresee any issue.
Cremer asked to see periodic progress reports on the project as well as a concept drawing.
Slooten moved to approve both parcel sales separately, with each receiving 5-0 votes.
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