The URL can be used to link to this page

Home My WebLink About20180213_LtrFrmCarmel_TwinCreeksL� Timai'HYJ. CARMEL 1 ZIYAD I. NACCASHA 2 MICHAEL M. MCMAHON DAVID H. HIRSCH MARA J. MAMET HEATHER K. WHITHAM EMILIE K. ELLIOTr DALLAS K. MOSIER SHANNON L. JONES City of San Luis Obispo Attn: Mayor and City Council 990 Palm Street San Luis Obispo, CA 93401 CARMKWACCASHA UP A9"P(1IMPYS A IAW — February 13, 2018 RE: Twin Creeks Conditions ofApproval Dear Honorable Mayor and Council Members: OF COUNSEL ALICIA M. GAmEz I ALSO ADMIT'T'ED IN NEVADA ZALSO ADMITTED IN ILLINOIS tcarmel@carnaclaw.com This office represents New Heritage Family Limited Partnership ("New Heritage") with respect to the appeal of the approval for the Twin Creeks mixed use project ("Twin Creeks"), which consists of 94 apartment units, 2,463 square feet of indoor residential amenity space, outdoor residential amenity space, and 3,488 square feet of commercial space. New Heritage is appealing the Architectural Review Committee's approval of Twin Creeks as a result of the inclusion of Condition of Approval 31A), which reads as follows: Prior to issuance of building permits, the applicant shall pay City the documented costs for reimbursement of the frontage improvements that were completed along Orcutt Road adjacent to the property. Such costs include City Transportation Impact Fees that were used to advance these public improvements required for the project. The final amount will be subject to the approval of the Public Works Director. Condition of Approval 31.d) is a thinly veiled attempt by the City of San Luis Obispo ("City") to enforce a void and illegal Reimbursement Agreement between the City and Orcutt Associates dated October 2, 2007 and amended on July 22, 2011 (the "Agreement") against my client. To do so is blatantly unfair and an illegal exaction. Section 16.20.11o.A of the City's Subdivision Regulations provides the circumstances under which a developer may be reimbursed. Those circumstances include satisfaction of Subsection 3, which requires: 3. The developer submits evidence of the actual costs of the improvements described in the reimbursement agreement. a. Evidence shall be provided in the form of receipted bills, canceled checks, or contracts. b. Evidence shall be submitted within sixty days of the city's acceptance of the improvements. Failure to timely submit evidence shall void the reimbursement agreement. (Emphasis added.) SAN LUIS OBISPO OFFICE: 1410 MARSH STREET - SAN LUIS OBISPO, CA 93401 - TEL: 805.546.8785 - FAX: 805.546.8015 PASO ROBLES OFFICE: 1908 SPRING STREET - PASO ROBLES, CA 93446 - TEL: 805.226.4148 - FAx: 805.226.4147 WEBSITE ADDRESS: WWW.CARNACLAW.COM San Luis Obispo City Council CARMEL & NAccAsHA LLP Page 2 of 3 February 13, 2018 The City accepted the Orcutt Road improvements in 2011. Orcutt Associates submitted documentation of actual costs of the improvements in 2015. The Agreement is void and unenforceable. Although that alone is sufficient justification of P& client's argument, there are other significant problems with this illegal exaction, not the least of which is that reimbursement for frontage improvements is not authorized by Government Code Section 66485, the State Statute upon which the City's Municipal Code reimbursement provisions are based. That section states: 66485• There maybe imposed by local ordinance a requirement that improvements installed by the subdivider for the benefit of the subdivision shall contain supplemental size, capacity, number, or length for the benefit of property not within the subdivision, and that those improvements be dedicated to the public. Supplemental length may include minimum sized offsite sewer lines necessary to reach a sewer outlet in existence at that time. (Amended by Stats. 1983, Ch. 704, Sec. 2.) The statute is intended to apply to water and sewer lines, other utility services, and facilities that, by their nature, must be installed beyond the subdivision boundaries to allow for cost efficient orderly development. "Supplemental size, capacity, number, or length" are dissonant terms when applied to street frontage improvements. The example of supplemental length used in the section highlights this problem: "Supplemental length may include minimum ,.1 ..�F�;+„ 1-1— su.,ry In rnonh o en,arnr nntlnt in nvietnnnn at that time " Tt ie a normal 1zeU V11O1L1. sewer lllV lil.liesO U1,' w aa.ua.aa u Ol TV part of urban development to have gaps in street frontage improvements between parcels. They exist in every city. There was no need to construct street frontage improvements on the former proposed Creekston project site (now Twin Creeks) and the property owner at that time refused to participate. And since the Agreement was not recorded against the Twin Creeks property (the "Property"), and thus wasn't identified in the preliminary title report for the Property, it was unknown to my client prior to the purchase of the Property. The frontage improvements had already been completed long before the Property was purchased by New Heritage and were figured into the fair market value. Had New Heritage known that reimbursement for the frontage improvements was a factor, my client would have addressed the issue during escrow or could have elected not to purchase the Property. Because the City failed to record the Agreement against the Property, my client was deprived of the opportunity to negotiate a reduction in the purchase price for the cost of the frontage improvements. Essentially, as a direct result of the City's carelessness, the City is attempting to force my client to pay for these improvements twice. Additionally, even if it were an enforceable agreement, because the frontage improvements were unilaterally built by Orcutt Associates, my client had no control over the project to ensure the improvements were built efficiently and at the lowest possible cost. In fact, the backup documentation for the improvements is a mess and the experts that we have had review that documentation have identified many irregularities and unjustifiable costs. Furthermore, it is not clear from the documentation whether the amount also includes other improvements, including the frontage improvements on Sacramento Drive and Duncan Lane. San Luis Obispo City Council CARMEL & NAcCAsHA LLP Page 3 of 3 February 13, 2018 Lastly, the Agreement itself identifies a very large benefit area, of which the Property is only a very small part. Many of the properties within that benefit area have been developed. Have those property owners reimbursed monies? If so, how much and which ones? If not, why has my client's project been singled out? The Agreement clearly contemplated reimbursements by many benefitting property owners, not just the owner of the Twin Creeks property. To the extent other property owners have benefitted yet have not been charged, this illustrates the City's violation of the "fair share" rough proportionality requirements of Nollan/Dolan and the Mitigation Fee Act. In short, any attempt to impose such cost obligations on my client's Property would violate its constitutional rights to be free from unlawful exactions. New Heritage respectfully requests that the City Council delete Condition of Approval 31.d). If New Heritage is forced to pay the City documented costs for reimbursement of Orcutt Road frontage improvements, it will do so under protest and the issue can be resolved by the San Luis Obispo County Superior Court. Sincerely, CARMEL & NACCASHA LLP f � othY Ja . rmel TJC/lmh Cc: John Ramirez, Rutan & Tucker C.M.Florence, AICP Client