By Katrina Van Duzee/Garden Grove Journal
The Garden Grove City Council unanimously approved a resolution to allocate $4.7 million in federal stimulus funds towards completing the stalled Garden Grove Galleria project on Tuesday.
The vacant metal frame located on Garden Grove Boulevard near Brookhurst Way will begin construction after a seven-month standstill, if the developer qualifies for the state-funded bonds.
Several members from the community attended the meeting to see what the council would say about using stimulus money to bailout the developer who stopped construction after defaulting on payments.
The eight-story building, if completed, will be a mixed use facility with 126,510 square feet used for commercial and retail purposes and the remaining space will make up 66 residential condos, the city’s web site said.
“I can’t help but think this is wrong, the developer should have done the right financing,” Garden Grove resident Charles Mitchell said. “Stimulus money is not free money. It comes out of the pockets of taxpayers and it will come out of the pocket of their children.” Mitchell proposed that in the future developers be required to have all the funds upfront to avoid incomplete eyesores in the community like the Galleria.
By passing the resolution the city agreed to be the awarding agency of the funds towards the project, but it is up to the developer to qualify for and pay back the funds, the council said. The bonds are tax-exempt and therefore cheaper then traditional bank loans.
“We can’t change where we are at, but we can try to save the project,” Mayor William Dalton said. “The main goal now is to complete the Galleria, not at the expense of the city.”
The staff report for the resolution noted that Garden Grove will not be responsible for the funds and the city has been looking for a project to spend the $4.7 million allocated by the federal government.
“When the government reaches in and helps someone, like we are trying to do for the Galleria, we put people to work,” Councilman Bruce Broadwater said. “
It makes things happen, boosts the economy and helps things go. If this economy picks up with the help of the government, then so be it.”