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HomeMy WebLinkAbout07/19/2011, C18 - TRANSFER OF FUNDS FROM THE SAN LUIS OBISPO COUNTY - SLO AREA FRINGE FEE � J council M`�`D� 7/19/2011 j agcnba REpoRt '�"� s' CITY O F SAN LUIS O B I S P O FROM: Jay D. Walter, Director of Public Work G) Prepared By: Timothy S. Bochum, DepuYy Director of Public Works SUBJECT: TRANSFER OF FUNDS FROM THE SAN LUIS OBISPO COUNTY - SLO AREA FRINGE FEE RECOMMENDATION 1. Authorize the Mayor to execute the attached Contribution Agreement with the County of San Luis Obispo authorizing the Public Works Director to accept the transfer of approximately $236,156 from the County Of San Luis Obispo's SLO Fringe Traffic Impact Fee Program. 2. Recognize the $236,156 transfer from the County of San Luis Obispo's SLO Fringe Traffic Impact Fee Program and allocate the same amount for construction purposes on the Tank Farm Road/Broad Street Intersection Widening Project. DISCUSSION Background For years San Luis Obispo County has implemented a traffic impact fee program in the area surrounding the City of San Luis Obispo to collect mitigation fees from development projects for use in addressing cumulative traffic impacts, This fee, commonly known as the SLO County Fringe Fee (also referred to as the County Road Improvement Fee), was established in coordination with City traffic impact fee programs. As part of the program, fees are collected from development for improvement projects that the County would either take lead in designing and constructing, or participate with the City in constructing. The Fringe Fee area encompasses most of the City's Airport Area and a small area outside of the City's sphere of influence. In 2005 the City adopted the Airport Area Specific Plan which sets land use possibilities in and around the Airport Area. As part of that approval, the Council included most of the area of County development that was previously outside of the City's potential Urban Reserve. As such, most of the urban type development that may occur in the County has the opportunity to annex to the City as part of the Airport Specific Plan process. While the decision to include these Phase II annexation areas within the Airport Area Specific Plan has reduced the inconsistencies between the County and City areas of land use, it also has presented a problem for the long term viability of the County's Fringe Fee program. Because most of the potential urban development is now contained within areas that will be annexed to the City, there is very little development left that will pay the SLO County Fringe Fee. Instead, properties annexing to the City would be responsible for paying the Citywide TIF, as well as the Airport Specific Plan fees to address cumulative traffic impacts. C18-1 Transfer of SLO County Fringe Fee Page 2 Recognizing this in December 2010 the County Board of Supervisors decided to disband the SLO County Fringe Fee program and instead rely on the City's impact fee programs for future participation in cumulative traffic impact fee collection. As part of that decision, the Board offered to transfer all collected Fringe Fees to the City of San Luis Obispo for use on an improvement project that is common to both fee programs. Public Works staff from both agencies met over a period of months to determine how the transfer of funds would take place and that the funding could be used on the widening project currently being designed for the intersection of Tank Farm Road/Broad Street. This project is under design and is anticipated to be in construction in early 2012. For subsequent development projects that develop in the County, the City will request and the County will consider requiring the payment of City transportation impact fees (either partially or in full) to mitigate project impacts in the area or be required to perform additional environmental analysis. Transfer of the funds to the City requires a resolution regarding the transfer, acceptance and use of the fees for public transportation improvements. FISCAL IMPACT There is no impact to the General Fund as part of acceptance of transfer of the Fringe Fee funding to the City. Acceptance of the funding means the City will have approximately$236,156 additional funding for use on constructing the widening project for the intersection of Tank Farm Road/Broad Street. ALTERNATIVES I. Deny Transfer of the Funds. The Council could choose to deny the transfer of the funds. Under this scenario the County has indicated they would refund the impact fee to the developers that paid the fees, rather than program them for a minor improvement project in the area. Staff does not recommend this alternative since the funds can be used to help offset costs for a current City project and the fees were collected for this purpose. 2. Accept the Funds, but use them on another project. The Council could choose to use the funds on another improvement project that is common to the City and County fee programs. Unfortunately, no other project common to both fee programs is far enough in development for timely use of the fees such as the Tank Farm Road/Broad Street widening project. Therefore staff recommends using the fees for that project. ATTACHMENT 1. Contribution Agreement T:\Council Agenda ReportsTublic Works CAR\201 I\Transportation\County Fringe Fee\CAR County Ftngee.fee.xfer.doc C18-2 ATTACHMENT CONTRIBUTION AGREEMENT THIS AGREEMENT, ENTERED INTO EFFECTIVE ON is between the COUNTY OF SAN LUIS OBISPO, a political subdivision of the State of California("COUNTY"), and the CITY OF SAN LUIS OBISPO, a charter city within the State of California("CITY"). RECITALS WHEREAS,the COUNTY established the San Luis Obispo Fringe Area Road Improvement Fee Mitigation Account (referred to herein as "ACCOUNT") for the area south of the CITY limits in 2001; and, WHEREAS,the COUNTY has collected funds towards improvements and established a Capital Improvement Program for these funds; and, WHEREAS,the CITY has a Transportation Improvement Fee Mitigation Account with a Capital Improvement Program; and, WHEREAS, COUNTY Capital Improvement Programs identify the widening of westbound lanes of Tank Farm Road immediately west of the intersection of Route 227 as a project to be funded through their respective Mitigation Fund Accounts (referred to herein as "PROJECT"); add details, i.e., costs and timing of project from last plan; and, WHEREAS,the PROJECT is projected to be constructed in 2015 and has been estimated at $895,925 in the COUNTY'S San Luis Obispo Fringe Circulation Study; and, WHEREAS,the CITY has annexed a large portion of the COUNTY under the Fee Program; and, WHEREAS, the COUNTY has acted to discontinue the ACCOUNT due to lack of remaining developable parcels within the San Luis Obispo Fringe Area; and, WHEREAS,the COUNTY seeks to transfer funds under the ACCOUNT to the CITY for implementation of the PROJECT. C18-3 ATTACHMENT NOW THEREFORE, the parties hereto intend to define herein the terms and conditions under which the COUNTY will transfer existing funding under the ACCOUNT to the CITY for implementation of the PROJECT. SECTION I COUNTY AGREES: 1. To transfer the Balance of the ACCOUNT to the CITY for the exclusive use in the implementation of the PROJECT upon the execution of this agreement. SECTION II CITY AGREES: 1. That the funds transferred from the ACCOUNT will be for the exclusive use in the implementation of the PROJECT. 2. To develop and implement the PROJECT as defined in the CITY Airport Specific Plan Impact Fee Capital Improvement Program. 3. To comply with the California Environmental Quality Act (CEQA) in the implementation of the PROJECT and to be fully responsible for implementing any and all environmental commitments set forth in the environmental documentation, permit(s), agreement(s), and/or environmental approvals for the PROJECT. The costs of said compliance and implementation shall be a PROJECT cost. 4. To defend against any legal challenge to the transfer of the balance of the ACCOUNT from the COUNTY to the CITY and/or to the project, including any environmental documentation and its supporting investigative studies and/or technical environmental report(s), permit(s), agreement(s), environmental commitments and/or environmental approval(s) for the PROJECT. All legal costs associated with those said legal challenges shall be a PROJECT cost. 5. To accept the balance under the ACCOUNT as the COUNTY'S full and complete contribution to the PROJECT. 6. To commence construction of the PROJECT by May 1, 2015. C18-4 ATTACHMENT 7. To expend funds transferred from the ACCOUNT in compliance with all applicable federal and state statues, including but not limited to the Mitigation Fee Act(Government Code §§66000, et seq.).. 8. To retain or cause to be retained for audit by COUNTY or other government auditors for a period of three (3) years from date of final payment, all records and accounts relating to project development and construction of the PROJECT. SECTION III It is Mutually a rg eed: 1. If CITY terminates the PROJECT prior to completion, the CITY shall return any remaining funds transferred from the ACCOUNT for redistribution by COUNTY. 2. No alteration or variation of the terms of this agreement shall be valid unless made by a formal amendment executed by the parties hereto, and no oral understanding or agreement not incorporated herein shall be binding on any of the parties hereto. COUNTY OF SAN LUIS OBISPO CITY OF SAN LUIS OBISPO Board of Supervisors City Council Adam Hill Jan Marx Chairperson Mayor By By Chair, Board of Supervisors Mayor, City of San Luis Obispo Attest: Attest: By By C18-5 ATTACHMENT Attest: Attest: By By County Clerk City Clerk Approved for Legal Form and Content: Approved for Legal Form and Content Warren Jensen, County Counsel By Deputy County Counsel AityAttorney Approved as to Content: By By Paavo Ogren Jay Walter Public Works Director Public Works Director PADave Flynn1CONTRIBUTION AGREEMENT TO CITY SLO JUNE 201 I.doc C18-6