RULES FOR BUSINESS TENANT PREFERENCE
AND OWNER PARTICIPATION
SUNNYVALE CENTRAL CORE REDEVELOPMENT PROJECT AREA
REDEVELOPMENT AGENCY OF THE CITY OF SUNNYVALE
NOVEMBER 2003

I. POLICY OF THE AGENCY

The California Community Redevelopment Law requires that the Redevelopment Agency of the City of Sunnyvale (the "Agency") extend reasonable preferences to persons who are engaged in business in Sunnyvale Central Core Redevelopment Project Area (the "Project Area") to re-enter in business within the Project Area if they are displaced by the redevelopment project (the "Project") and otherwise meet the requirement of the Redevelopment Plan for the Central Core Redevelopment Project Area (the "Plan").  The Community Redevelopment Law further provides that the owners of property within the Project Area boundaries be given the reasonable opportunity to participate in the Project provided such participation is consistent with the requirements and goals and objectives of the Plan. 

When the Plan was originally adopted in 1975, the Plan contained rules for owner participation and business tenant preference.  The purpose of these Rules is to update the 1975 rules, consistent with Section VIII of the Plan.

These Rules shall apply and be effective as of that date of adoption of these Rules by the Agency.  These Rules are consistent with Section VIII of the Plan and are intended to replace any rules that the Agency has previously adopted.

II. RULES TO IMPLEMENT PREFERENCES TO DISPLACED BUSINESSES

A. Names and addresses of all businesses which are displaced by Agency activities within the Project Area ("Displaced Businesses") will be maintained by the Agency to assist redevelopers in tenant selection for space within the Project Area.

B. All documents for land disposition, loan or other Agency assistance for new or rehabilitated commercial developments in the Project Area shall contain a provision indicating the Agency's preference for Displaced Businesses and shall require the redeveloper to extend reasonable preferences to Displaced Businesses which desire to remain or return to the Project Area, provided that the Displaced Business conforms to the requirements of the Plan.

C. At such time as third party redevelopers are in a position to seek business tenants for new developments within the Project Area, the Agency shall cause notice of such space to be provided to all Displaced Businesses, and shall offer reasonable non‑financial assistance to such Displaced Businesses as may be necessary to help secure the desired relocation, provided that the Displaced Business conforms to the requirements of the Plan.

III. RULES TO IMPLEMENT OWNER PARTICIPATION

A. Development of Multiple Parcels by Master Developer

1.  The Agency may determine, in its reasonable discretion, by resolution, that it is in the best interest of the Project Area that several parcels be assembled and developed by a single developer (a "master developer") as a unified development.  Such determination may be made at the Agency's own direction or in response to an application by a property owner whose property would be designated for inclusion in a unified development area or by another person or entity who desires to become a master developer for a designated unified development area.  Any individual or other entity may apply in writing to the Agency to become a master developer.  The Agency shall give the record owners of all affected parcels ten (10) days written notice and the opportunity to be heard by the Agency prior to the proposed adoption of a resolution determining that several parcels are to be assembled and developed by a master developer.

 

2.  Upon determination that several parcels will be assembled and developed as a unified development, the Agency shall notify the owners of all affected parcels of such determination and shall invite the owners to submit proposals to become the master developer. In its discretion, the Agency may also invite non‑owner entities to submit proposals to become the master developer.

 

3.  In soliciting proposals, the Agency shall establish criteria for master developer selection which, in the Agency's reasonable determination, are appropriate to the size, scope, character and quality of the envisioned development.  These selection criteria may include without limitation, as appropriate: the scope of land acquisition necessary to accomplish the redevelopment, the nature and quality of the proposed development; the financial capability of the prospective master developer; the technical and professional quality of the prospective master developer development team, including architects, engineers, contractors, marketing consultants and others; and the record of experience of the prospective master developer in completing other projects of comparable size, scope and complexity.  As set forth in the Plan, where complete clearance and reconstruction of existing buildings is essential to producing a desirable redevelopment result, piecemeal participation by an individual owner in redevelopment of his or her owned-parcel may not be possible.  But any such owner shall be offered the opportunity to submit a proposal for redevelopment of the parcels to be assembled.  In addition, where privately-owned parcels are planned to be redeveloped into publicly-owned facilities as part of a plan for overall assemblage of parcels, an individual owner will not have the opportunity to redevelop his or her parcel.  Any such owner, however, shall be offered the opportunity to submit a proposal for redevelopment of the parcels to be assembled. 

 

4. The Agency shall select a master developer according to the selection criteria established pursuant to subparagraph III.A.3 above based on the proposals submitted by prospective master developers. In reviewing proposals that meet the minimum standards established by the Agency for selection, the Agency shall give such preference as it deems appropriate under the circumstances to existing owners of one or more of the parcels that will be part of the unified development.  The Agency may, but shall not be required to, select a master developer for less than all of the parcels initially designated for unified development.  If, in the Agency's reasonable determination, no proposal meets the minimum standards for selection, the Agency may reject all proposals and take such actions as it deems appropriate to solicit additional proposals, modify its concept for unified development of the affected parcels, or otherwise fulfill the objectives of the Plan and these Rules for such parcels.

 

5. Following selection of a master developer, the Agency and the master developer shall negotiate and execute, if possible, a master development agreement setting forth the rights and obligations of the Agency and the master developer with respect to the unified development of the affected parcels in accordance with the Plan.

 

6.  Once the Agency has determined that several parcels are to be assembled and developed by a master developer, it may acquire one or more of those parcels if the Agency determines such acquisition is in the interest of the Project Area. Such acquisition may precede solicitation of or selection of a master developer for the parcels to be assembled.  The owners of property acquired by the Agency prior to solicitation or selection of a master developer shall be entitled to submit a proposal for development of the several parcels that will be assembled.

 

7. If a master development agreement cannot be executed within the negotiations period established by the Agency, or if, following execution, the master development agreement is subsequently terminated prior to completion of the contemplated development, the Agency may take such actions as it deems appropriate to negotiate with another qualified developer, solicit additional proposals, modify its concept for unified development of the affected parcels, or otherwise fulfill the objectives of the Plan and these Rules for such parcels.  Such Agency actions shall not require further solicitation of proposals from or involvement of the owners of the affected parcels unless, in the Agency's sole determination, the concept for a unified development of the affected parcels is being substantially modified, in which event, the affected parcel owners (together with any non-owner entities designated by the Agency) will be entitled to submit a proposal to serve as master developer for such substantially-modified unified development in the manner provided in paragraphs A.2 through 4 above.

 

8.  For the purposes of this Part III, an owner shall include a person or entity who has contract or option to purchase a parcel in the designated master developer area, provided the contract to purchase or option has not expired or been terminated.

B.      Development of Individual Parcels by Existing Owner 

Provided that the Agency does not determine, in its reasonable discretion, by resolution, that it is in the best interest of the Project Area that a particular parcel be assembled with other parcels and developed by a master developer as part of a unified development, then that parcel may be developed by its existing owner in accordance with the rules set forth below.

 

1.  Each parcel in the Project Area shall be considered to conform to the Plan unless and until the Agency has determined by resolution that such parcel does not conform to the Plan.  A determination of non‑conformance may be made by the Agency at its own direction or in response to a request for a determination regarding conformance by a property owner in the Project Area.

 

2.  If the Agency determines a parcel does not conform to the Plan, the owner of such parcel shall be required to enter into an owner participation agreement with the Agency pursuant to the requirements of subsection III.B.4 below.

 

3. If the Agency has made no determination of non­conformance with respect to a parcel, the owner of such parcel may continue ownership without an owner participation agreement subject to the limitations set forth in the following sentence.  In the event (a) the Agency makes a subsequent determination that the parcel does not conform to the Plan, (b) the owner intends to construct any additional improvements or substantially alter or modify existing structures on the parcel, or (c) the owner intends to acquire additional real property within the Project Area, then the Agency may require such owner to enter into an owner participation agreement with the Agency pursuant to the requirements of subsection III.B.4 below.

 

4.  If a property owner is required to enter into an owner participation agreement with the Agency pursuant to the provisions of subsections III.B.2 or III.B.3 above, the Agency shall notify the property owner in writing of such a requirement.  The property owner may then become an owner participant by meeting the following requirements:

 

a.  Each participant must agree to record or permit to be recorded on the participant's property, a declaration of restrictions ensuring use of the property in a manner consistent with the Plan and the owner participation agreement for the property.

 

b.  Within fifteen (15) days of the notification described above, the owner shall meet with Agency staff to discuss necessary requirements to bring the owner's property into conformity with the Plan. 

 

c. Within sixty (60) days thereafter, the owner shall submit preliminary improvement plans and a general statement of plans for financing such improvements for review by the Agency.

 

d.  The Agency may reasonably extend these time periods when it is in the best interest of the Project Area to do so.

 

e.   Upon acceptance of the plans described in subdivision (c) above, as revised or corrected if necessary, the owner shall enter into an owner participation agreement with the Agency to assure the orderly development of the required improvement to the property.

 

5. If an owner who is required to enter into an owner participation agreement either (a) fails to submit preliminary improvement plans and a detailed financing program in form and content reasonably acceptable to and approved by the Agency, or (b) fails or refuses to enter into such agreement pursuant to subsection III.B.4 above, or (c) having entered into an owner participation agreement, thereafter fails to perform any of the owner's obligations under an executed agreement, the owner shall, at the sole discretion of the Agency, forfeit his/her rights to participation under the Plan and these Rules. In addition, failure by an owner to participate as required by the Plan and these Rules may cause the Agency to seek any and all remedies available to achieve such participation and may subject the property to acquisition by the Agency if the Agency determines that it is in the interest of the Project Area to undertake such acquisition; provided, however, that the Agency may exercise its powers of eminent domain only in the circumstances and manner otherwise authorized by the Plan.