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HomeMy WebLinkAbout19 - The Port TheaterNewport Beach City Council AGENDA ITEM 19 ADDENDUM September 28, 1998 Council Meeting TO: MAYOR AND CITY COUNCIL FROM: DENNIS DANNER, ACTING CITY MANAGER BY: DAVE KIFF, ASSISTANT TO THE CITY MANAGER SUBJECT: THE PORT THEATER During a conversation with Dave Kiff on Friday, September 25, 1998 with Scott Burnham, the owner of the Port Theater, Mr. Burnham asked that the following information be relayed to the City Council prior to its consideration of Agenda Item 19: The improvements to the Port that would be required to bring it up to today's standards (listed in the Report as costing about $1.5 million) do not include a new audio and projection system. Burnham believes that these latter improvements are as integral to the marketability of the Port as are the structural improvements. We did not discuss pricing for the audio and projection systems, but City staff believes that this will add at least $250,000 to the price tag). • Burnham notes that the number of petitions that he has now received is in the range of 2,600 — not 1,600 as is identified in the Staff Report. • To better clarify his intent, Burnham said that "as a resident and someone who feels strongly about the Port and Corona del Mar," his "15' priority is to keep the Port as a theater use." He adds that, if completing the required improvements is not cost - effective, he "may be forced to consider other alternatives" that may include other uses and structural modifications. • As to his support of listing the Port as a historical resource, Burnham noted that it might be inappropriate at this time to look at such designation given that it could limit his options in the short-term. Should community support lead to a long -term theater use for the Port, Burnham did not express any opposition to the listing at a later date. Newport Beach City Council Newport Beach City Council AGENDA ITEM 19 September 28, 1998 Council Meeting TO: MAYOR AND CITY COUNCIL FROM: DENNIS DANNER, ACTING CITY MANAGER BY: DAVE KIFF, ASSISTANT TO THE CITY MANAGER SUBJECT: THE PORT THEATER ISSUE: What should the City do, if anything, regarding the closure of the Port Theater in Corona del Mar? BACKGROUND: The Port Theater, located at 2905 East Coast Highway in Corona del Mar, is a 12,500 square foot, 930 -seat theater built around 1950. Since 1989, Landmark Theatre Corporation leased the Port from owner Scott Burnham. Landmark operated the Port as an "art house" theater, showing primarily independent and foreign films to what the LA Times has described as "a small but loyal group of customers." Citing "poor profits," Landmark closed the doors of the Port in August 1998, a week before Landmark's lease with Burnham expired. When Port theater -goers heard about the pending closure of the Port, several individuals formed a group called "Save the Port" and started a petition drive. Members of the group say that they have collected 1,600 signatures on petitions which ask "that the City of Newport Beach do what it can to keep the Port Theater in use as a film theater (as opposed to any other office space or commercial use)." They presented some of these petitions to the City Council on August 24, 1998. During that Council meeting, Mayor pro Tern Dennis O'Neil asked City staff to meet with the Port's owner, Mr. Burnham, and to report back on Burnham's interest in maintaining the Port's current use along with various alternatives that might assist Mr Burnham in his goal. DISCUSSION: Given Mayor pro Tern O'Neil's direction, this report addresses the following topics: I —The Status of the Port as a Theater Use; II — City Staff's Meeting with Scott Burnham; III — Perspectives on the Port's Value as a historical landmark; IV — Current City Commitments to Theater and Arts Projects; and V — Options for City Action. Newport Beach City Council Agenda Item Pane 2 I — Status of the Port as a Theater Use The Newport Beach Municipal Code requires a use permit for "use classifications typically having unusual site development features or operating characteristics ... so that they may be designed, located, and operated compatibly with uses on adjoining properties and in the surrounding area" (NBMC §20.91.010). While the Port Theater does not have a use permit, Mr. Burnham's operation of the Port as a theater use was "grandfathered" in. In other words, a theater use is a legal but non - conforming use at that site. Under today's code, the City would likely require a theater owner (building a theater from ground —up) to have more parking than currently assigned to the Port. According to Planning Director Patricia Temple, the City's municipal code (NBMC §20.91.050[D]) dictates that, if Burnham does not actively "market" for a new theater operator in the next 180 days, the grandfathered non - conforming use will effectively expire, thus requiring a use permit to restore a theater use to the building. If Burnham documents that he has continued to search for a theater operator throughout the period where the Port lies dormant, the Planning Director may indefinitely continue the "grandfathered" status of the non - conforming use and still allow a theater use at the Port without requiring a use permit. II — City Staff's Meeting with Scott Burnham Assistant City Manager Sharon Wood, Planning Director Patricia Temple, and Assistant to the City Manager Dave Kiff met with Mr. Burnham on September 1, 1998. During the meeting, Mr. Burnham said that he would "prefer' that the Port remain a theater use, but that a new theater operator would likely require significant and expensive tenant improvements prior to entering into any long -term lease. Needed improvements include restroom upgrades and access to the balcony area under the Americans with Disabilities Act (ADA), new seating, new heating and air conditioning, and more. Burnham had prepared plans for these improvements and had submitted (and then withdrawn) them to the City in July 1994. During the meeting, City staff agreed to re- review Burnham's 1994 plans to determine how they might be adjusted according to today's codes. Building Director Jay Elbettar reports back that "the 1994 ($1 million) cost is short by today's figures and the newer codes with which the Project must comply." Elbettar estimates that, "based on the scope shown (in the Plans) and code issues a figure of $1.5 million (is more appropriate)." Given that Burnham submitted the Plans in July 1994, the plan review period for these documents expired in March 1995 — therefore, all of the work must be done anew should Burnham want to re- submit remodeling plans. Continuing the discussion over the owner's options, Burnham noted that, if he determined that it was not cost - effective to make the theater - related improvements to the building, he may pursue alternative uses for the building, including retail and office space. Such alternative uses may or may not require significant modifications to the outside structure of the building. During the meeting, staff also discussed options for designating the Port as a historic structure. Such designation allows income tax credits for restoration of commercial property, waivers of certain fees, some property tax assistance, the use of historic building codes, and competitive grants for improvements. A summary of the range of Agenda Item historic designations, the structures that so qualify, the respective designation processes, and the benefits of designation appear in Attachment A. Because most of these designations are driven by the property owner's consent, any action to begin the designation process likely rests with Mr. Burnham. III — Perspectives on the Port's Value as an Historical Landmark The City sought out the opinions of the following individuals to help determine the "value' of the Port Theater as a historical landmark. Here are their comments: • Dr. William Hendricks, Historian at the Sherman Library and Gardens, believes that the Theater does have some historical significance, due in part to its "snub nosed marquee" and its gunnite construction. Hendricks asserts that the State directed the builder of the Port to use a marquee with less depth to ensure that Coast Highway could always carry military and other large vehicles. The gunnite construction is significant, Hendricks believes, due to its relative rarity of use. In gunnite construction, liquid cement is "shot" on the building. • Mr. John Loomis, an architect with 30r" Street Architects in Newport Beach, calls the Port "locally significant" in terms of its architecture because of its construction, exterior fagade, and interior ceiling treatments, among other things. Loomis notes that the Port is one of the "few remaining examples" of its type of construction from that era — an era that Loomis called "the heyday" of Newport Beach's growth. Loomis believes that the Port could qualify as a Point of Historical Interest (again, see Attachment A for more information about this designation). • Mr. Bill Grundy, President of the Newport Beach Historical Society, said that the Port is "a locally significant property because of its age, but the Port is not one of our designated landmarks. Personally," Grundy continued, "I'd love to see it stay there (as a theater use)." Grundy noted that the Balboa Theater on the Peninsula is older than the Port and already has a preservation mechanism underway. See Attachment A for the properties that are on the Historical Society's list of local landmarks. IV — Current City Commitments to Theater and Arts Projects The City has a number of ongoing theater and arts projects to which it has either made a formal commitment or is considering an action in the near future. These include: The Newport Theatre Arts Center. This facility is a City -owned theater at Ensign View Park off of Cliff Drive. The City purchased this theater from the State of California on September 13, 1974 for $601,600. Today, the Friends of the Newport Theatre Arts Center run the day -to -day operation of the community theater program. The City's Community Services Department determines the Center's priorities of use, rental fees, and scheduling. The City pays about $3,200 in maintenance costs for the Theater each year, and has approved spending $67,500 from the General Fund to support a $157,500 "remodel and upgrade" of the Center this year. Contributions to this upgrade project from the Friends are budgeted at $90,000. Readers can find the specific instructions for the Theatre's operations in Council Policy 1 -6 (Attachment B). • The Balboa Theater. The City is considering its options regarding this property at 707 East Balboa Avenue. Among the alternatives under consideration is the City's assistance with the acquisition of the Theater for rehabilitation and reuse by a non -profit community group called the Balboa Theater Foundation. The Balboa Theater is within an area eligible for Community Development Block Grant (CDBG) expenditures. Agenda Item • Cultural and Arts Division. The City's Community Services Department includes a Cultural and Arts Division. In FY 1998 -99, the City's budget proposes spending about $102,000 for this Division, which includes the salary of a full -time Cultural Arts Coordinator and $40,000 used to fund cultural grants to arts organizations that provide programs and projects which impact the residents of Newport Beach. The Cultural Arts Coordinator supports the work of the City Arts Commission and reports to the Community Services Director. V — Options for City Action The City Council can take any one of the following options in addressing the issue of "what to do with the Port Theater" now that it has closed: • Take No Formal Action. Recognizing that the Port is a privately -owned building and that the City has already made a public commitment to the Newport Theater Arts Center and may make a second commitment to the Balboa Theater, the City Council may decide not to take any action regarding the Port Theater. In other words, the Council would merely "receive and file" this Report. BENEFITS include saving resources for other arts and theater programs and other infrastructure efforts. COSTS include potentially "losing" the Port as a community resource. • Expression of Intent. The City Council may wish to relay the concerns of the petitioners who wish to "Save the Port" as a theater use by sending a letter to Mr. Burnham noting the City's formal interest that the Port remain in use as a theater. BENEFITS include saving resources for other arts and theater programs and providing a more formal vehicle for the petitioners' concerns. COSTS include potentially "losing" the Port as a community resource. • City- sponsored Listing on the California Register of Historical Resources. The City could spearhead an effort to list the Port on the California Register of Historical Places. If the owner does not consent to the listing, the effort will merely allow the State Office of Historic Preservation to note that the Port is "eligible" for listing on the California Register. BENEFITS include some potential for assistance for the property owner should he decide to make renovations to the Port; recognition of the Port's locally significant presence in the community. COSTS include potential additional limitations placed upon the owner should the owner decide not to maintain the Port's current use; action still does not assist owner financially with "required" repairs. • Renovation Assistance. The City could enter into an agreement with Mr. Burnham to assist him financially with the repairs deemed necessary to attract a competent theater operator to the Port. In order to assure that there was no "gift of public funds" issue with such assistance, the City would likely require that the City and its residents receive some direct benefit, such as community programming access to the Port, as a result of the assistance. As reflected in this Report, the estimated cost of bringing the Port "up to speed" may be about $1.5 million. BENEFITS include assisting the Port owner with the resources he "needs" to keep the facility as a theater use, thus maintaining the Port's presence in Corona del Mar; also the addition of a CDM -based community facility. COSTS include all of the infrastructure projects throughout the City that would not receive funding because the Port did; arguably, adding the Port to the list of the City's current theater - related commitments is an overly ambitious emphasis on a specific use given the current demands on City resources. Agenda Item RECOMMENDED ACTION: Select one or more of the following alternatives: (1) Receive and File this Report; or (2) Formally state via a letter to the owner, Mr. Scott Burnham, the City's desire that the Port Theater remain in use as a theater; or (3) Direct City staff to begin the formal process to attempt to "list" the Port Theater on the California Register of Historical Resources; or (4) Direct City staff to return to the City Council with a plan to assist the Port's owner, Mr. Burnham, in renovations deemed appropriate to attract a competent theater operator to the Port. City assistance shall be in an amount not to exceed $ and shall require concessions on the owner's part to make the Port available for various community programs. ATTACHMENTS: Attachment A — Historical Designations and Process Attachment B — Council Policy 1 -6 (Newport Theatre Arts Center) Agenda Item 0 Attachment A Historical Designations and Process TYPES OF HISTORIC DESIGNATIONS Council Policy K -2 establishes the procedure that the City uses to designate a property as "having importance to the history or architecture of the City." The Newport Beach Historical Society also has a list and a designation process (not outlined here). The City's process is as follows: QUALIFYING STRUCTURES: To qualify for the City's Register as a building of architectural significance, the property must • Embody a distinguishing architectural style, period, or construction method; or • Be a notable work of a master builder, designer, or architect whose style influenced the City's development; or • Be a rare structure displaying a building type, design, or indigenous building form; or • Embody special architectural and design features; or • Be a unique structure that acts as a focal point key to the character or visual quality of an area; or • Be an outstanding example of structures displaying original architectural integrity (structurally or stylistically). To qualify for the City's Register as a building of historical significance, the property must: • Be connected with an event significant in the economic, cultural, political, or civic history of the City, the county, the state, or the nation; or • Be identified with the lives of historical persons associated with the City, the county, the state, or the nation; or • Be a site representing historical development patterns such as urbanization, railroads, agricultural settlements, and canals. DESIGNATION PROCEDURE: The method for placing a property on the City's Register is as follows: • First Step -- Property owner applies to the City Council in the form prescribed by the City Manager; • Second Step — City Manager submits the application to the Parks, Beaches, and Recreation Commission, the Arts Commission, and the Newport Beach Historical Society for review and recommendation. What Properties are on the City's Register? 1. Balboa Pavilion 2. Rendezvous Ballroom - Historical Plaque - 1985 3. Jolly Roger Restaurant - (Dippy's) - 1985 4. Balboa Inn - 1986 5. Bank of America building - 1986 (now demolished) 6. Balboa Theater - 707 E. Balboa Blvd. - 1996 7. 700 E. Bay Avenue/701 Edgewater (building housing Balboa Saloon /Pizza Pete's) - 1998 • Third Step -- The City Council receives the recommendations and determines whether or not to place the property on the Register. BENEFITS OF DESIGNATION: Council Policy K -2 claims as an incentive for preservation the Council's consideration of reductions or waivers of application and permit fees. State Designation Agenda Item _ Page 7 What Properties are on the Newport Beach Historical Society's List or Historical Landmarks? 1 — Dory Fishing Fleet (1890) 2 — Newport Beach Grammar School (1894) 3 — Balboa Pavilion (1904) 4 — Balboa Island Ferry (1909) 5— Newport Harbor Yacht Club (1916) 6 — western Fish Canners Company (1921) 7 — American Legion Post 291 (1924) 8 — Kerchoff Marine Biology Lab (1926) 9 — Newport Harbor High School (1930) 10 — South Coast Shipyard (1933) 11 — Site of 3'" National Boy Scout Jamboree (1953) State recognition typically involves designation as a California Historical Landmark ( "a resource of statewide significance "), a Point of Historical Interest ( "a resource of local or countywide importance "), or listing on the California Register of Historic Places (the list of all resources across the state designated as Landmarks or Points of Historical Interest). QUALIFYING STRUCTURES: To be listed on the California Register, a structure must be: • the first, last, only, or most significant of its type in the state or region; or • associated with a group or individual having a "profound influence" on the state or region's history; or • an outstanding example of a period, style, or architectural movement that is one of the more notable works of a pioneer architect, designer, or master builder within the state or region. DESIGNATION PROCEDURE: For structures proposed for designation as a California Historical Landmark or a Point of Historical Interest, advocates must follow this procedure: • First Step — Obtain the property owner's written consent for designation; • Second Step — Acquire an application from the State Office of Historic Preservation (OHP); • Third Step — Complete and return the application, including statements describing the historical significance of the property; and • Fourth Step — Review by staff of the Office of Historic Preservation; • Fifth Step — After notifying the affected local government of the proposed designation and Who Serves on the State Historical Resources Commission? The Commission consists of 9 persons appointed by the Governor. Five members must be "recognized professionals" In either history, prehistoric archaeology, historic archaeology, architectural history, or architecture. One member shall be knowledgeable In ethnic history and one in foldife. Two members represent the public. Commissioners serve 4- year terms. allowing 60 days for comment, the State Historical Resources Commission hears and acts upon the Item. Agenda Item _ Pape 8 For structures proposed for listing on the California Register of Historic Resources, advocates must follow this procedure: • First Step — Acquire an application from the State Office of Historic Preservation (NOTE: Property owner consent is NOT required); • Second Step — Notify the affected local government and request that the local government provide written comments on the proposed listing to the CHIP; • Third Step —After 90 days, complete and return the application and comments to the CHIP; • Fourth Step — After 30 days, the CHIP notifies the property owner and sets the item on the SHRC's agenda. • Fifth Step — Item heard and acted upon by the SHRC. If the property owner objects to the listing, the SHRC can only designate the property as "eligible" for listing on the California Register. Structures that receive designation as California Historical Landmarks or a California Point of Historical Interest are automatically listed on the California Register of Historic Resources. BENEFITS OF DESGINATION: If a property receives state designation on the California Register, it receives the following "benefits ": • City building inspector must grant code alternatives under State Historic Building Code; and • County assessor may contract with property owner for property tax reduction under the Mills Act; and • Environmental review may be What is the Mills Act? required under the California Environmental Quality Act The Mills Act is a state law (Revenue and Taxation Code 439 et (CEQA) if the property is seq.) that allows the County Assessor to value certain historical threatened b a project; i and property based upon formulas other than the Fair Market value of Y P 1 the property. • Depending upon the level of . If the property is commercial or rental property. the Assessor designation, the property may may assign a value based in the cash flow associated with the receive a bronze plaque, a property's ongoing operation as a historic structure. highway directional sign, or . If the property is an owner-occupied home, the Act allows the authorization for the owner to Assessor to assign a value based on a capitalization rate that place his or her own marker on takes into account mortgage rates, a'historical property risk" the structure. component. and more. Federal Designation The National Register of Historic Places "recognizes resources of local, state, and national significance." Included on the National Register are only those properties that "have retained enough physical integrity to accurately convey their appearance during their period of historical significance." QUALIFYING STRUCTURES: Structures listed on the National Register are those that: • Are associated with events that have made a significant contribution to history; or • Are associated with the lives of persons significant in our past; or • Embody distinctive characteristics of a type, period, or method of construction; or • Represent the work of a master; or • Possess high artistic values; or Agenda Item • Represent a significant entity whose components may lack individual distinction; or • Have yielded, or are likely to yield, information important in history or pre- history. DESIGNATION PROCESS: Placement on the National Register requires the following steps: • First Step — Obtain an application from the State Office of Historic Preservation. • Second Step — Inform the property owner of the proposed listing — a property may not be listed on the National Register if the property owner objects to the listing. • Third Step — Submit completed forms to the State OHP. • Fourth Step — State OHP reviews the application, allows affected local governments 60 days to comment prior to a noticed public hearing of the State Commission. • Fifth Step — If approved by the Commission, the State Historic Preservation Officer submits the application to the Keeper of the National Register. The Keeper has 45 days to determine whether to list the property on the National Register. BENEFITS OF DESIGNATION: Recognition on the National Register of Historic Places allows for: • Limited federal tax incentives for rehabilitation — includes a 20% income tax credit for qualified rehabilitations if the property is income - producing (not owner - occupied); • Tax deductions for the donation of a preservation "easement;' • Limited protection from "federal undertakings' and projects (such as highway construction and CDBG projects) that might adversely impact the listed property; • Local building inspectors to grant code alternatives under the State Historical Building Code; • Mills Act assistance (see State designation); • Listing on the California Register of Historic Resources (which includes the California Register's benefits and protections); • Owner's ability to place a plaque or marker at the resource site. Agenda Item _ Paae 10 Attachment B Council Policy 1 -6 COMMUNITY THEATRE POLICY The arts and culture are becoming an increasingly important part of community life in the City of Newport Beach. Recognizing this, the City Council hereby establishes the following policy relating to the operation, scheduling, and financing of the Newport Theatre Arts Center, the City's community theatre facility. In the context of a philosophy which encourages people to help themselves in their leisure and cultural pursuits, the Community Services Department is committed to a cooperative effort to provide community theatre and arts related leisure activities at the Newport Theatre Arts Center. The Department welcomes volunteer support and involvement and this policy will serve to identify and clarify the relationships, roles, and control between the City of Newport Beach and the Friends of the Newport Theatre Arts Center. Definition of a Community, Theatre Community Theatre is a volunteer effort often using nonequity, community based performers in its productions. A self - supporting effort funded by memberships, ticket sales and donations from the local private sector is necessary to provide the operational funds to offer the function. Community theatre offers all levels of performers an opportunity to participate and develop their skills while involved in a learning environment. Community theatre is a supplement to other programs available on a regional and /or professional level. They should complement each other to provide a well rounded base for cultural growth in a community. Financial The City is responsible for financing the Newport Theatre Arts Centers maintenance and operation only to the extent of the annual City Council approved budget. The City encourages the Friends of the Newport Theatre Arts Center to continue their efforts as a self- supporting community theatre and to expand their support of the Arts and Culture in Newport Beach. The Friends of the Newport Theatre Arts Center shall provide the Community Services Deparment with a copy of all financial reports on a regular basis. Facilitv Use and Schedulin The City, through the Community Services Department, is responsible for determining priorities of use, rental fees, and overall scheduling of the Newport Theatre Arts Center. Community theatre activities shall have priority of use in accordance with Council Policy 1 -1, Use, Priorities and Fees for Facilities. A policy of multiple cultural and artistic use will be maintained at the center. The Department maintains a master calendar for the Newport Theatre Arts Center; all users must apply to the Community Services Department. The Friends of the Newport Theatre Arts Center will be accorded first priority for use in accordance with Council Policy 1 -1. Scheduling of community theatre activities at the Newport Theatre Arts Center will be done by the Recreation Superintendent in cooperation with the Friends of the Newport Theatre Arts Center president. Proqramminq and Administration The Friends of the Newport Theatre Arts Center will be responsible for the day -to -day operation of the community theatre program. Within the context of cooperative programming, decisions will be made jointly by the Community Services Department and the Board of the Friends of the Newport Theatre Arts Center. The Recreation Superintendent shall be an ex-officio member of the Board of the Friends of the Newport Theatre Arts Center. Any improvement or physical change must have advance approval by the Community Services Department. The programs at the Theatre Arts Center are cooperative efforts of the Community Services Department and the Friends of the Theatre Arts Center, as Department programs- -and in consideration of the significant volunteer contribution by the Friends of the Theatre Arts Center — facility use fees are not appropriate. Clerical assistance is provided by the City; all requests for this assistance will go through the Recreation Superintendent. Equipment, services and financial contributions provided by the Friends of the Theatre Arts Center are welcome and are in keeping with the cooperative philosophy of the Community Services Department. The Recreation Superintendent will obtain input from the Friends of the Theatre Arts Center Board of Directors in preparing the Recreation Division annual budget. Adopted - July 27, 1981 Amended - January 24, 1994