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REDEVELOPMENT AGENCY OF <br />THE CITY OF SAN LEANDRO <br />STAFF REPORT <br />DATE: April 27, 2009 <br />TO: <br />FROM: <br />BY <br />Steve Hollister, Executive Director <br />Redevelopment Agency <br />APPROVED AND <br />FORWARDED <br />TO REDEVELOPMENT <br />AGENCY <br />~~ <br />Stephe . Hollist <br />Executive Director <br />Luke Sims, Comm(u~ni~ty^Development Director <br />Cynthia Battenberg; mousiness Development Manager <br />SUBJECT PROJECT/PROJECT DESCRIPTION: <br />RESOLUTION OF THE CITY OF SAN LEANDRO AND RESOLUTION OF THE <br />REDEVELOPMENT AGENCY OF THE CITY OF SAN LEANDRO MAKING <br />DETERMINATIONS WITH RESPECT TO CEQA, APPROVING A PURCHASE AND SALE <br />AGREEMENT, AUTHORIZING AN INTER-PROJECT AREA LOAN, AND AUTHORIZING <br />THE EXPENDITURE OF TAX INCREMENT FUNDS FOR THE ACQUISION OF 1550 <br />EAST 14TH STREET (APN: 077-0540-009-00) <br />SUMMARY AND RECOMMENDATION <br />Staff recommends that the City of San Leandro (City) and the Redevelopment Agency of the <br />City of San Leandro (Agency) approve the attached resolutions making determinations with <br />respect to CEQA, approving a Purchase and Sale Agreement, authorizing an inter-project area <br />loan, and authorizing the expenditure of tax increment funds for the acquisition of 1550 East 14tH <br />Street. <br />BACKGROUND <br />In 1947, Lucky began operating a grocery store at 1550 East 14th Street (Site). In May 2005, <br />Red Mountain Retail Group (Red Mountain) acquired a portfolio of Lucky properties, including <br />the Site. Red Mountain holds ownership of the Site through Norcal AL LLC (Norcal), a limited <br />liability corporation. In September 2005 the grocery store closed due to underperformance. <br />In 2007, Norcal filed a series of lawsuits in Alameda County Superior Court against the City <br />contending that various planning and zoning actions related to the City's approval of the Transit <br />Oriented Development Strategy (TOD Strategy) for the City's downtown area violated their <br />constitutional rights or were otherwise contrary to law. The City prevailed in three actions now <br />on appeal in the State Court of Appeal. A fourth action is pending in State Court. <br />In 2008, the Council placed a priority on resolving the litigation due to the prominence of this <br />downtown site and the blight created by the store vacancy. On Apri120, 2009, the Council voted <br />