HomeMy WebLinkAboutItem #1 San Luis Ranch Staff ReportPLANNING COMMISSION AGENDA REPORT
SUBJECT: Public meeting to consider various actions related to the previously-approved San
Luis Ranch project, including a Specific Plan Amendment and an associated Final Supplemental
Environmental Impact Report (SEIR). This meeting is also to consider a Development Agreement
to implement the project as amended based on a previously-approved Term Sheet.
PROJECT ADDRESS: 1035 Madonna Road BY: John Rickenbach, Contract Planner
Phone Number: 805-610-1109
Email: JFRickenbach@aol.com
FILE NUMBER: SPEC/ANNX/ER-1502-2015 FROM: Tyler Corey, Principal Planner
RECOMMENDATION: Recommend to the City Council that they take the following actions as
contained in the attached Resolution (Attachment 1): 1) certify the Final Supplemental EIR; affirm
and modify as needed previously-adopted CEQA Findings and Statement of Overriding
Considerations to allow for a proposed Specific Plan Amendment; and modify the previously-
approved Mitigation Monitoring and Reporting Plan to reflect updated mitigation measures from
the previously-certified Final EIR; 2) find the proposed Specific Plan Amendment consistent with
General Plan policies; 3) approve the proposed Specific Plan Amendment; and 4) approve the
proposed Development Agreement for the project.
SITE DATA
Applicant
Representative
General Plan
and Zoning
Site Area
Environmental
Status
MI San Luis Ranch, LLC
Marshall Ochylski and Bill Wells
Specific Plan Area (various land
use designations including—
residential, commercial, office,
open space and agriculture
consistent with the Land Use
Element and San Luis Ranch
Specific Plan)
131.3 acres
A Final Supplemental EIR is
available for review.
Environmental review for the
proposed modification consists of
a Supplemental EIR and an
Addendum.
Meeting Date: June 28, 2018
Item Number: 1
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SUMMARY
On July 18, 2017, the City Council approved the San Luis Ranch Specific Plan and certified the
associated Final EIR for that project, which envisions a mixture of residential and non-residential
development on roughly 70 acres of a 131.3-acre site. The remainder of the site would remain in
agricultural use or open space. Approved entitlements at that time also included a Vesting
Tentative Tract Map/Development Plan for the residential portion of the project. Ultimately, the
project site requires annexation to the City before any development under the approved Specific
Plan can occur.
A Development Agreement application was previously authorized by the City Council for this
project. Based on a Term Sheet previously approved by the Council in 2017, the negotiation of
the Development Agreement progressed. Through these negotiations, the project applicant, MI
San Luis Ranch, LLC, determined that the fixed sequential phasing of development and timing
requirements of the associated Prado Road Interchange project would impact their ability to
finance the infrastructure required to support the project. In order to address this, the applicant is
now proposing to modify the previously approved project by adjusting the phasing plan description
such that each of the project phases could overlap, be out of sequence, or be concurrent, depending
on market conditions and to adjust project conditions and/or mitigation measures to implement the
adjusted phasing plan.
Although the fixed sequential phasing has been adjusted, the San Luis Ranch Specific Plan still
includes a phased development schedule which identifies the number of residential units that can
be constructed in any given year. As with the Avila Ranch project, the Community Development
Director may authorize the developer, in any given year, to construct 50% more of the units
allocated to the project in the following year if the Director determines that doin g so is necessary
to facilitate construction of beneficial public facilities and infrastructure. The purpose of this
authorization is to realize the public benefits associated with the Project, mitigate known potential
impacts resulting from the Project, and implement development requirements, including
infrastructure requirements, which the City has found to be consistent with the requirements of the
City’s Growth Management Ordinance. Under no circumstances though can the number of units
constructed exceed the City’s Growth Management Ordinance.
These changes would be reflected through a Specific Plan Amendment and in the Development
Agreement. No other approved entitlements would be affected. The proposed revision envisions
no change to the land use plan or development potential compared to what was approved by the
City on July 18, 2017.
A Final Supplemental EIR has been prepared to analyze the effects of those proposed changes,
and is available for review on the City’s website at:
http://www.slocity.org/government/department-directory/community-development/documents-
online/environmental-review-documents.
In addition, the original certified Final EIR for the project on which the Final SEIR is based is also
available on the City’s website. It should be noted, however, that the certified Final EIR is not
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under review (since it was already certified), but a link is provided for reference, primarily to
provide context for the review of the Final SEIR:
http://www.slocity.org/government/department-directory/community-development/planning-
zoning/specific-area-plans/san-luis-ranch.
1.0 SITE INFORMATION
The site is comprised of approximately 131 contiguous acres in unincorporated San Luis Obispo
County, surrounded by areas within the City of San Luis Obispo, and within the City’s Sphere of
Influence, generally bounded by Madonna Road, Dalidio Drive and U.S. Highway 101. Dominant
features of the site include the predominantly flat landform, seasonally planted with row crops, an
existing stand of eucalyptus trees in the southwest portion of the site, and the Dalidio ranch-related
buildings in the northwestern portion of the site.
Table 1: Site Information
Site Size ~131 acres
Present Use & Development Agriculture
Topography Flat
Access Madonna Road, Dalidio Drive and Froom Ranch Way
Surrounding Use/Zoning West: R-1 (low density residential)
North: PF, C/OS-40, R-1, C-R-PD (Laguna Lake Park and surrounding
open space, low density residential, and the U.S. post office)
East: PF, O-PD (U.S. Highway 101, the City’s wastewater treatment
plant and a drive-in theater)
South: C/OS-20, C-S, C-S-PD, C-T-SF, C-R (SLO City Farm, Target,
variety of commercial service uses, and auto dealerships)
2.0 PLANNING COMMISSION’S PURVIEW
The Planning Commission’s role is to review and provide a recommendation to the City Council
on the proposed Specific Plan Amendment, Final SEIR and Development Agreement, which is
based on the development parameters of the project approved on July 18, 2017, and also reflects
the phasing approach included in the revised project. No other previously-approved entitlements
are under consideration at this time.
3.0 PREVIOUS ADVISORY BODY REVIEW
The Planning Commission considered and provided input on the San Luis Ranch project on nine
occasions from 2014 through 2017, before finally recommending approval in June 2017. The City
Council approved the project on July 18, 2017. Prior to its July 2017 approval, the project was
also considered before various Cit y advisory bodies to consider specific aspects of the proposed
project that relate to their purview. These advisory bodies included the Bicycle Advisory
Committee (BAC), Parks and Recreation Commission (PRC), Architectural Review Commission
(ARC), and Cultural Heritage Committee (CHC). These reviews helped inform the Planning
Commission’s recommendation to the City Council, ultimately leading to project approval.
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Because the revised project only involves a modified phasing approach, and no changes to land
use, development buildout potential, or architecture, no City advisory body review is required
other than the Planning Commission.
The Airport Land Use Commission (ALUC) also reviewed and recommended approval of the
original project with conditions that were incorporated into the approved project. Because the
revised project involves a Specific Plan Amendment to address changes to phasing, the ALUC is
required to consider the revised project, even though no land use or safety considerations that fall
within their purview were part of the proposed action. At a hearing on May 16, 2018, the ALUC
unanimously found that the proposed Specific Plan Amendment is consistent with its adopted
Airport Land Use Plan (ALUP).
On May 23, 2018, the Planning Commission held a public hearing on the Draft SEIR, taking public
testimony on the document, and providing input for consideration in the Final SEIR (Attachment
2). This input is now reflected in the Final SEIR currently under consideration.
4.0 CEQA PROCESS
4.1 Determination to Prepare a Supplemental EIR
The City Council unanimously certified a Final EIR and approved the project on July 18, 2017,
pursuant to City Council Resolution No. 10822 (2017 Series). A Notice of Determination
(NOD) was prepared, and there were no legal challenges to the adequacy of the Final EIR
during the 30-day statute of limitations associated with the NOD, pursuant to CEQA (PRC
Section 21167 and CEQA Guidelines Section 15094).
The proposed modification to the approved project would only affect the phasing and
development schedule, not the land use pattern or ultimate buildout potential of the project.
Nevertheless, this change requires a Specific Plan Amendment, which is a “discretionary”
action that is subject to CEQA. A Supplement to the Final EIR (or “Supplemental EIR”) was
determined to be the appropriate approach to CEQA compliance pursuant to CEQA Guidelines
Section 15163, focusing on only those issues where potential impacts could be different, or the
analysis changed, from what was included in the certified Final EIR. A Supplemental EIR tiers
from the original Final EIR and is appropriate when only minor changes to an approved project
are contemplated.
Section 1.0 of the Final SEIR describes the full legal basis for this determination.
The SEIR serves as an informational document for the public and City of San Luis Obispo
decision-makers. Based on a Planning Commission recommendation, the process will
culminate with a City Council hearing to consider certification of a Final SEIR as well as the
applicant’s requested modifications to the previously-approved project.
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4.2 Final Supplemental EIR Contents and Conclusions
In general, the resulting overall impact of development would be similar to what was
previously described in the certified Final EIR, because the same amount of development
would be contemplated. However, there could be differences in the analysis of impacts and
mitigation measures for certain issue areas that relate to project phasing, which could affect
the timing and need for certain mitigation measures or result in a different level of significance
for such impacts during the time the project is being developed. This is potentially the case
for the following issues areas, which are the focus of the analysis in the Final SEIR:
•Air Quality (Section 4.3 of the certified Final EIR)
•Greenhouse Gas Emissions (Section 4.6 of the certified Final EIR)
•Land Use/Policy Consistency (Section 4.9 of the certified Final EIR)
•Transportation (Section 4.12 of the certified Final EIR)
These issues as they relate to updated project conditions are studied in Sections 2.1, 2.2, 2.3
and 2.4 of the Final SEIR, respectively.
The updated analysis included reviewed technical studies related to air quality, greenhouse gas
emissions, and transportation. Based on these studies, the Final SEIR drew the following
conclusions with respect to the above issues:
•Air Quality. Although emissions calculations were slightly different based on the
compressed phasing and assumed start year of construction, there were no changes to
the conclusions of the certified Final EIR. The level of significance of each impact
identified in the Final EIR would be the same. In a worst-case scenario studied in the
SEIR, which assumed that all approved development would be built within one year, a
new mitigation measure would be required to prepare a Construction Activity
Management Plan (CAMP) consistent with Air Pollution Control District (APCD)
requirements. However, practically speaking, growth management restrictions in the
Specific Plan and Development Agreement would preclude the possibility that all
development could actually occur within one year. Therefore, this mitigation measure
would not be required based on the growth management restrictions included in the
revised project through the amended Specific Plan and Development Agreement.
•Greenhouse Gas Emissions. The updated analysis and emissions calculations resulted
in no changes to the conclusion of the certified Final EIR that impacts would be less
than significant without mitigation.
•Land Use/Policy Consistency. The revised project was determined to be consistent
with relevant General Plan policies and zoning. There are no changes to the
conclusions of the certified Final EIR, although a new analysis of the revised project’s
consistency with the City’s Growth Management Ordinance and related General Plan
policies is included. The Final SEIR analysis finds that the revised project is consistent
with these provisions.
•Transportation. The certified Final EIR found that there were ten transportation-
related impacts (T-1 through T-10), six of which were Class I, significant and
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unavoidable. Because buildout and long-term cumulative impacts under the revised
project are identical to what was anticipated under the certified Final EIR, impacts with
respect to transportation issues remain generally unchanged from those included in the
certified Final EIR, except as noted in the following discussion.
The original 10 impact statements from the certified Final EIR would still apply,
although the discussion of Impacts T-1, T-2, T-3 (which reflect near-term plus project
conditions) and T-5 are modified, and a new impact (T-11) has been identified. This
new impact is summarized as follows:
Under Existing and Near-term Plus Project conditions buildout of the project
prior to construction of the Prado Road Overpass & NB ramps would result in
Highway 101 from Madonna to Los Osos Valley Road operating below
Caltrans level of service standards. This is a Class I, significant and
unavoidable impact.
The remaining impacts (Impacts T-4, T-6, T-7, T-8, T-9, and T-10) remain unchanged
from the certified Final EIR. Seven of the 11 impacts (T-1, T-2, T-3, T-8, T-9, T-10,
and T-11) are Class I, significant and unavoidable. The remaining 4 impacts (T-4, T-
5, T-6 and T-7) are Class II, significant but mitigable.
Note that all impacts previously identified in the certified Final EIR would still be observed
with the revised project, as would the classification of such impacts. That is, all impacts
previously identified as Class I would still be Class I, and all impacts identified a Class II
would still be Class II. Transportation Impact T-11 is a new impact not previously identified,
and is considered Class I, significant and unavoidable.
4.3 EIR Processing Requirements and Preparation of the Final SEIR
Under the provisions of the California Environmental Quality Act (CEQA), a 45-day public
review period of the Draft SEIR is required, which is the same process as was required for the
originally certified Final EIR. A Draft SEIR was prepared and released to the public on April
30, 2018. This started a 45 day public review period that ended on June 13, 2018. CEQA does
not require that a public meeting be held during the public review period, but does encourage
it. The Planning Commission held a public hearing to solicit input on the Draft SEIR on May
23, 2018.
The Final SEIR is a compilation of the Draft SEIR, responses to comments to the Draft SEIR,
and any changes made as a result of those comments. Only minor revisions were made as a
result of this input, notably the inclusion of additional wording on Mitigation Measure AQ -
2(a) to address climate change concerns raised by APCD, and a new table that compares the
mitigation measures from the certified Final EIR with those that have been modified in the
SEIR in order to clarify the differences between the two documents. In neither case do these
changes affect the analysis, conclusions, or intent of the required mitigation measures. All
changes made to the text of the Draft SEIR are clearly noted in the Final SEIR.
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4.4 Addendum to Certified Final EIR
Subsequent to the certification of the Final EIR and approval of the San Luis Ranch project in
July 2017, the City of San Luis Obispo conducted additional analysis of traffic operations along
the U.S. Highway 101 corridor in the vicinity of Prado Road as a part of the US 101/ Prado
Road Interchange Project. In April 2018, Caltrans approved the US 101/Prado Road
Interchange Project Study Report-Project Development Support (PSR-PDS), which identifies
and evaluates viable build alternatives for the interchange. Operational results from the PSR-
PDS are presented in the San Luis Ranch Specific Plan Multimodal Transportation Impact
Study Addendum (TIS Addendum, 2018) prepared by Omni-Means, a GHD Company. The
setting and project description for the purpose of the updated traffic report remain unchanged
from those included in the certified Final EIR. Please refer to that document for setting
information related to analyzing project impacts.
The Supplemental TIS describes traffic operations for mainline, ramp merge and diverge, and
weaving sections along US 101 from south of the Los Osos Valley Road interchange to north
of the Marsh Street interchange. It reports existing, near term (2025), and cumulative (2035)
conditions both with and without the San Luis Ranch project. The Supplemental TIS concludes
that “This updated analysis does not materially change the findings and conclusions of the
May 2017 San Luis Ranch Specific Plan Multimodal Transportation Impact Study.” The
referenced May 2017 study was the primary source document for the FEIR.
To address CEQA requirements associated with this action, an Addendum was prepared, which
incorporates the additional analysis for inclusion in the environmental record. The Addendum
is available, including the updated traffic study, at City Hall (990 Palm Street, San Luis
Obispo), and on the City’s website at the following link:
http://www.slocity.org/government/department-directory/community-
development/documents-online/environmental-review-documents.
According to §15164(b) of the State CEQA Guidelines, an Addendum to an EIR is the
appropriate environmental document in instances when “only minor technical changes or
additions are necessary or none of the conditions described in Section 15162 calling for the
preparation of a subsequent EIR have occurred”. The updated analysis does not materially
change the findings and conclusions of the FEIR, nor does it introduce substantial new
information that would affect the ability to make an informed decision on the project. For this
reason, a Subsequent EIR was determined to be unnecessary pursuant to Section 15162 of the
CEQA Guidelines.
An Addendum does not require public circulation because it does not provide significant new
information that changes the certified FEIR in a way that deprives the public of a meaningful
opportunity to comment upon a substantial adverse environmental effect of the project or a
feasible way to mitigate or avoid such an effect.
The City Council will consider this Addendum with the certified Final EIR, as well as the
Supplemental Final EIR that addresses the Specific Plan Amendment, as part of their review
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of the updated project.
5.0 GENERAL PLAN GUIDANCE AND POLICY CONSISTENCY
The San Luis Ranch (Dalidio) Specific Plan Area was one of three Specific Plan areas designated
for development when the General Plan Land Use and Circulation Elements update was adopted
by the City Council in December 2014. On July 18, 2017, the City Council found as part of its
approval of the San Luis Ranch project that it was consistent with the General Plan. An evaluation
of the project’s consistency with General Plan policies is discussed at length in Section 4.9 of the
certified Final EIR.
However, the certified Final EIR did not examine the effect of compressed or flexible project
phasing with respect to the City’s growth management regulations. For that reason, the relevant
growth management policies from the City’s General Plan and Zoning Regulations are analyzed
in Section 2.3 of the Final SEIR. The Final SEIR concludes that the revised project is consistent
with the City’s growth management regulations, based on the analysis provided to address Impact
LU-5 within that document. In summary, that analysis found that there is sufficient existing and
projected capacity within the City’s annual growth limitations to accommodate all development
under the proposed project within the proposed compressed development timeframe.
Based on the conclusions of both the certified Final EIR and the Final SEIR, the proposed Specific
Plan Amendment is consistent with the General Plan. In addition, the Development Agreement is
based on the Term Sheet that was approved by the City Council in July 2017, which was
determined to be consistent with the General Plan at that time. Because the Development
Agreement generally reflects the Term Sheet and modified phasing concept included in the
Specific Plan Amendment, both of which were found to be consistent with the General Plan, the
Development Agreement is consistent with the General Plan.
6.0 PROJECT SUMMARY AND DISCUSSION
6.1 Previously-Approved Project Description Summary
The previously-approved project is the development of a major new City neighborhood, which
will be governed by a Specific Plan. As summarized in the certified Final EIR, the San Luis
Ranch Project consists of a Specific Plan, General Plan Amendment and Pre-Zone, and
Development Plan/Vesting Tentative Tract Map, including annexation of the site into the City
of San Luis Obispo. The site is located in unincorporated San Luis Obispo County, generally
between Madonna Road and U.S. Highway 101, south of Dalidio Drive, and is identified by
assessor’s parcel number (APN) 067-121-022.
The approved project includes a mixture of residential, commercial, office, and hotel uses, with
approximately 53 acres of the site preserved for agriculture and approximately 7.4 acres
preserved for open space uses. Phases 1, 2, and 3 of the project would consist of residential
development. Phases 4, 5, and 6 would consist of non-residential (commercial and office)
development.
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As shown in Figure 1, the Specific Plan area is organized into six land use designations, which
are equivalent to zoning within the area. These include Neighborhood General 1 (NG-10),
Neighborhood General 2 (NG-23), Neighborhood General 3 (NG-30), Neighborhood
Commercial (NC), Open Space (OS), and Agriculture (AG). The applicable densities and
development standards associated with each of these zones are described in detail below. Table
1 lists the approved San Luis Ranch Specific Plan zones, acreages, and maximum buildout
potential within each zone of the Specific Plan Area.
Table 1. Approved San Luis Ranch Specific Plan Area Development
Type Specific Plan Zone % of Site Units Acreage
Planned Development 1
Low-Medium Density Residential NG-10 16.4% 200 units 21.5 acres
Medium Density Residential NG-23 5.5% 100 units 7.3 acres
High Density Residential NG-30 8.4% 246 units 11.0 acres
Affordable Housing Density Bonus 2 34 units n/a
Commercial NC 9.0% 150,000 SF 11.9 acres
Office NC 3.2% 100,000 SF 4.2 acres
Hotel and Conference Center NC 2.7% 200 rooms 3.5 acres
Public Parks 2.1% 2.8 acres
Roads 6.8% 9.0 acres
Agricultural and Open Space
Agriculture AG 39.8% 52.3 acres
Internal Open Spaces OS 5.9% 7.8 acres
1. Planned Development area is based on net site area of approximately 122.5 acres. The gross site area is approximately 131.4 acres,
less approximately 8.9 acres of right-of-way associated with regional roadway improvements.
2. The project includes up to 34 deed-restricted affordable units on site. Per Section 17.090.040(d) of the City’s Affordable Housing
Incentives, the included affordable housing allows for a 20% density bonus.
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The City Council unanimously certified the Final EIR and approved the project on July 18,
2017, pursuant to City Council Resolution No. 10822 (2017 Series).
6.2 Proposed Changes to the Approved Project (“Revised Project”)
After further investigation, the applicant found that the required fixed sequential phasing of
development and timing requirements associated with the Prado Road Interchange project
creates constraints on financing options, which potentially renders the development project
infeasible because the upfront infrastructure requirements are not financeable when the income
stream needed to service that loan (i.e. the construction of housing and commercial space) is
dependent on a large infrastructure project that is being constructed by the City. In order to
address this problem, the project applicant proposes to modify the previously approved project
by adjusting the phasing plan description such that each of the project phases could overlap,
be out of sequence, or be concurrent, depending on market conditions and to adjust project
conditions and/or mitigation measures to implement such adjusted phasing plan, including:
(i)Removing phase numbering from mitigation measures T-1, T-2, & T-3;
(ii)Removing condition of approval #6 “Project construction and infrastructure shall
be completed in the sequential phase order as evaluated in the San Luis Ranch
EIR...”; and
Figure 1. Approved Land Use Designations/Zoning
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(iii)Revising the mitigation measure monitoring program such that construction of the
Prado Road Overpass & Northbound Ramp is not a requirement prior to
occupancy of Phase 2 or any other project Phase.
The Prado Overpass and Northbound Ramps project is a joint City and Caltrans effort currently
on schedule to begin construction in 2021. The proposed change in the San Luis Ranch project
description does not affect the interchange schedule or the project’s requirement to dedicate
the necessary right-of-way and pay its fair share.
Based on item (i), Mitigation Measures T-1, T-2 and T-3 would now be revised based on an
updated analysis, as described in Final SEIR Section 2.4, Transportation.
In addition, the revised project includes an amendment to the Specific Plan to permit the
Community Development Director to authorize the developer, in any given year, to also
construct 50% of the units allocated to the project in the following year if the Director
determines that doing so is necessary to facilitate construction of beneficial public facilities
and infrastructure. The purpose of this authorization is to realize the public benefits associated
with the project, mitigate known potential impacts resulting from the project, and implement
development requirements, including infrastructure requirements, which the City has found to
be consistent with the requirements of the City’s Growth Management Ordinance. These
changes would be reflected in the Specific Plan and Development Agreement. No other
approved entitlements would be affected. The proposed revision envisions no change to the
land use plan or development potential compared to what was approved by the City on July
18, 2017.
Specific Plan Amendment. The development potential under the approved San Luis
Ranch Specific Plan would remain unchanged from what was approved in July 2017.
However, development could now occur more rapidly or in a different order than previously
contemplated as described above and irrespective of when the Prado Road Interchange will be
completed. The pace of residential and commercial development would still be subject to
limitations set forth in the Specific Plan and Development Agreement for the project. The
applicant will be required to pay its fair share contribution to the Prado Road Interchange
project and the Interchange project will continue to be developed by the City and Caltrans with
construction anticipated to begin in year 2021.
The portions of the approved Specific Plan that relate to phasing and the timing of development
and related improvements will be modified to reflect the changes described above, and are
included as Attachment 3 to this staff report. This modification is considered a Specific Plan
Amendment and is being processed as such. The Supplemental EIR under consideration is
prepared to address the potential impacts of these changes to the Specific Plan.
6.3 Development Agreement
Background and Overview
In April 2014, the City Council authorized City staff to begin a process for the City to enter
into a Development Agreement with the project applicant. A Development Agreement is a
legal tool that allows public agencies to gain public improvements beyond what would either
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be required through a typical planning process to address identified impacts related to a project
or to achieve important public improvements or amenities or to obtain other valuable project
components such as affordable housing and other similar restrictions. A Development
Agreement typically includes the payment of fees needed to help implement such
improvements. In exchange, a project applicant is provided certain assurances related to future
development, often with respect to timing. A Development Agreement cannot be implemented
unless the necessary underlying planning entitlements are approved; in this case, a Specific
Plan, General Plan Amendment/Pre-Zoning, and Vesting Tentative Tract Map. The site must
also first be annexed to the City before its provisions become effective.
In July 2017, the City Council approved a Term Sheet that would form the basis of the
Development Agreement. The Term Sheet represented the tentative agreement between the
developer and the City on important areas related to the phased and orderly development of
the property. Based on this Term Sheet, the City and developer subsequently negotiated the
details of a full Development Agreement, which is now presented to the Planning Commission
before being forwarded to the City Council.
The Development Agreement works in parallel to other entitlements, and in the case of San
Luis Ranch, the proposed conditions of approval require its approval with a detailed
infrastructure financing plan before certain portions of the entitlement can take effect. The
Development Agreement would not change the development parameters included in the
Specific Plan, but would fine-tune their implementation, building on the Conditions of
Approval associated with the Vesting Tentative Tract Map.
Legal Basis for the Development Agreement
A Development Agreement is a contract between a developer and a city (or county) in which
the city provides the developer with vested development rights for a defined period of years in
exchange for the developer providing “extraordinary” public or “community” benefits that
exceed what would otherwise be permissible by law, i.e. the land use regulation “police
powers” delegated to local government by the State of California.
Development Agreements are a unique planning tool authorized by statute pursuant to
Government Code section 65864 – 65869.5 wherein the parties agree to “freeze” all rules,
regulations, and policies that are in place as of the execution of the agreement (Gov. Code
Section 65866; Santa Margarita Area Residents Together v San Luis Obispo County Bd. of
Supervisors (2000) 84 CA4th 221). The Development Agreement structure, because it is a
voluntary negotiation process between a developer and city, also allows a city to negotiate
developer concessions or contributions that it could not otherwise obtain from a developer
through normal exactions or conditions of approval. In other words, because a Development
Agreement is an arm’s length type of transaction, the nexus/rough proportionality due process
requirements do not apply.
In some circumstances, Development Agreements can provide both greater flexibility and
greater certainty in the development of large or complex projects. However, it should be noted
that Development Agreements are legislative acts and subject to referendum, so the flexibility
afforded by the tool is limited by community values.
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Development Agreement Review
The Planning Commission is required to make the following findings (SLOMC 17.94.100)
when making a recommendation to the City Council, who would then consider the
Development Agreement for possible approval:
17.94.100 Planning commission hearing and recommendation.
The commission shall consider the proposed development agreement and shall make its
recommendation to the council. The recommendation shall include whether or not the
proposed development agreement meets the following findings:
A.The proposed development agreement is consistent with the general plan and
any applicable specific plan;
B.The proposed development agreement complies with zoning, subdivision and
other applicable ordinances and regulations;
C.The proposed development agreement promotes the general welfare, allows
more comprehensive land use planning, and provides substantial public
benefits or necessary public improvements, making it in the city’s interest to
enter into the development agreement with the applicant; and
D.The proposed project and development agreement:
1.Will not adversely affect the health, safety or welfare of persons living or
working in the surrounding area; and
2.Will be appropriate at the proposed location and will be compatible with
adjacent land uses.
Key Provisions of the Development Agreement
The Development Agreement between San Luis Ranch and the City covers the general terms
of the agreement as well as the specific commitments of both the developer and the City
(Attachment 1; Exhibit B). Requirements that are part of the Conditions of Approval or the
FEIR are generally not repeated in the Development Agreement but rather, are incorporated
by reference. The exhibits included with the Development Agreement are intended to ensure
that the entire package can be viewed on a standalone basis as the agreement between the
Developer and the City. During the period of time between when the Planning Commission
makes the required findings and the City Council’s review of the Development Agreement
there may be administrative changes required to either the Development Agreement, the
exhibits or the attachments to provide more clarity or additional information. Any material
changes will be highlighted to the Council to inform their deliberations and any fundamental
modification will be reviewed by the Planning Commission.
Major items or “deal points” that are covered in the Development Agreement that are
summarized below:
1)Term: The length or term of the agreement is 20 years with a possible 10-year extension.
2)Financing: The Developer has a large investment to make in services and infrastructure.
The plan is to establish a CFD to help finance these costs. The Development Agreement
requires the City to consider in good faith the funding, establishing and forming a
mechanism or mechanisms to facilitate funding costs related to the project.
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3)Fees: Normally, a project subject to a vesting tentative tract map only pays the impact fees
that were in place at the time the project application was “deemed complete.” When the
San Luis Ranch project received its original entitlements, the City was in the process of
updating its AB1600 impact fees. Through the negotiation process surrounding the
Development Agreement, the amount of the “vested” fees was modified. Specifically, the
developer has agreed to pay the new impact fees for parks, police and fire and has agreed
to pay all other fees (transportation, water and waste water) based on a sliding scale – the
amount of the fees goes up 10% each year until the amount equals the updated fee amounts.
4)Reimbursement: The Development Agreement and the financing plan layout the options
for reimbursement and the possible sources of reimbursement. Two key points are that the
City’s general fund is not at risk for any reimbursement and that the “fair share” allocations
of the infrastructure are based on the percentages identified. Actual reimbursement will be
based on the actual costs not on the estimated costs included in the financing plan.
5)Energy and Water Conservation: The agreement documents requirements that exceed
both existing and anticipated regulatory requirements related to energy and water
conservation features, including solar and building efficiency/net zero.
6)Affordable and Workforce housing: The project includes design and development
strategies that serve to provide lower cost housing by providing for a range of housing sizes
and types, greater affordability of very low income Inclusionary Housing units than
required by Ordinance (26 units), local preference, owner occupancy restrictions, deed
restricted workforce housing (14 units) and local heroes program. These are contractual
requirements that exceed the City’s regulatory authority for affordable housing.
7)Early payment of Prado Road Overpass. In order to facilitate the timely construction of
the Prado Road Overpass, the developer has agreed to pay $1,500,000 of mitigation fees
potentially prior to the fee being triggered. This funding will be used to pay for the City’s
and CalTrans’ costs related to planning, design and environmental review of this
infrastructure.
8)Residential Development “shortfall” fee. The new residential development will require
additional city services such as police and fire protection. Anticipated revenue from the
commercial portion of the project is anticipated to exceed the costs of these services,
however, the timing of when the commercial development will occur is unknown. In order
to cover this potential gap, the City will impose an “Early Residential Developmen t Fee”
in the amount of $262 per constructed unit per year. Once the commercial development is
constructed, the annual fee terminates.
9)Public Benefit: The City’s outside consultant, Economic Planning Systems (EPS), has
reviewed the financials of the project and the commitments of the Developer and the City
that are included in the Development Agreement and concluded that the City is receiving
approximately $14,250,000 more in extraordinary public benefits than the Developer is
receiving in benefits related to the proposed development agreement.
Development Agreement’s Relationship to the Supplemental EIR
The Development Agreement concept was considered in the certified Final EIR, and the
approved Term Sheet reflected the approved entitlements addressed in that Final EIR. As
noted above, the Development Agreement now under consideration reflects the approved Term
Sheet and project entitlements, so the potential environmental impacts of that action are already
addressed in the certified Final EIR. The modified phasing approach addressed in the Final
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SEIR will be reflected in both the Specific Plan Amendment and as needed within the
Development Agreement. Therefore, any impacts associated with phasing, whether reflected
in the Specific Plan or Development Agreement, are fully addressed in the Final SEIR.
8.0 NEXT STEPS
If the Planning Commission recommends certification of the Final EIR, and approval of the
Specific Plan Amendment and Development Agreement to the City Council, these are the next
steps in the process:
•City Council Considers Revised Project. The City Council will review the Planning
Commission recommendations, and consider the revised project, including the
Development Agreement, tentatively scheduled for July 17, 2018.
•Annexation. LAFCo will consider the City’s application for annexing the project area into
the City based on the revised project, if approved. If the revised project is denied, the
annexation application could still go forward based on the existing approved project.
•Project Development. Once annexed, the City’s approved project entitlements will become
effective, including Development Agreement provisions.
9.0 ATTACHMENTS
1.Resolution recommending certification of the Final Supplemental EIR and approval of
the Specific Plan Amendment and Development Agreement
2.Planning Commission Minutes from May 23, 2018
3.San Luis Ranch Specific Plan Amendments
The San Luis Ranch certified Final EIR, Addendum to the previously-certified Final EIR and
Final Supplemental EIR are available for review online at the following location:
http://www.slocity.org/government/department-directory/community-development/documents-
online/environmental-review-documents
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RESOLUTION NO.
A RESOLUTION OF THE PLANNING COMMISSION
OF THE CITY OF SAN LUIS OBISPO
RECOMMENDING CERTIFICATION OF THE FINAL SUPPLEMENTAL
EIR FOR, AND APPROVAL OF,
AN AMENDMENT TO THE SAN LUIS RANCH SPECIFIC PLAN AND
RECOMMENDING THE CITY COUNCIL ADOPT AN ORDINANCE
APPROVING A DEVELOPMENT AGREEMENT BASED ON THE
FINDINGS IN SUPPORT OF THE DEVELOPMENT AGREEMENT AS
REQUIRED UNDER MUNICIPAL CODE CHAPTER 17.94.100
FOR PROPERTY LOCATED AT 1035 MADONNA ROAD
(SPEC/ANNX/ER-1502-2015 a.k.a. “SAN LUIS RANCH”)
WHEREAS, the City Council certified a Final Environmental Impact Report (“Final EIR”
or “FEIR”) that facilitated approval of the San Luis Ranch Specific Plan and related entitlements,
including a Development Plan/Tentative Tract Map, and Term Sheet on July 18, 2017; and
WHEREAS, the Planning Commission of the City of San Luis Obispo conducted a public
hearing to consider: (1) a revised phasing concept (the “Revised San Luis Ranch Project”) for the
approved San Luis Ranch project, to be reflected in a Specific Plan Amendment, on June 28, 2018;
and (2) the San Luis Ranch Project Development Agreement (the “Development Agreement”) which
is based under the authority of Government Code §§ 65864 et seq. and San Luis Obispo Municipal
Code Chapter 17.94; and
WHEREAS, the Planning Commission hearing was for the purpose of formulating and
forwarding recommendations to the City Council of the City of San Luis Obispo regarding the
Revised San Luis Ranch Project and the Development Agreement; and
WHEREAS, notices of said public hearing were made at the time and in the manner required
by law; and
WHEREAS, the proposed Development Agreement provides for the orderly development
of the Revised San Luis Ranch Project and outlines the financing mechanisms to fund construction
of the infrastructure, and identifies funds for potential reimbursement for certain infrastructure costs,
requires sustainable building features and technology that have the potential to reduce greenhouse
gas emissions, establishes an on and offsite agricultural mitigation strategy, and incorporates
affordable housing standards that exceed those required under the City’s applicable housing policies,
ordinances and programs; and
WHEREAS, the Development Agreement for the project implements the San Luis Ranch
Specific Plan and related entitlements as evaluated in the certified Final Environmental Impact
Report (“Final EIR”), as well as in the Final Supplemental Environmental Impact Report (“Final
SEIR”), and does not introduce any new potential environmental impacts; and
WHEREAS, the Development Agreement does authorize the project to accelerate buildout
of the project above the phasing schedule so long as in doing so is necessary to facilitate construction
of beneficial public facilities and infrastructure as determined by findings by the Community
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Development Director and that the buildout above the cumulative maximum shown for each year in
the phasing schedule will not exceed the City’s Growth Management Ordinance; and
WHEREAS, an acceleration in the buildout of the project schedule will not introduce any
environmental impacts because: 1) the acreage, boundaries, land use pattern, and density of
development will remain the same as that analyzed in the Final EIR and Final SEIR; 2) project
components such as road improvements that serve to mitigate impacts as well as mitigation measures
identified in the Final EIR and Final SEIR will continue to apply to each component of development;
4) the cumulative buildout of the project was analyzed in combination with other projects under
development and analyzed with the full buildout of the City as forecasted in the 2014 LUCE General
Plan Update and related Final Environmental Impact Report for that project; and 5) all applicable
mitigation measures for each component of development would also be accelerated to coincide with
any phased portion of development under construction; and
WHEREAS, the Planning Commission has duly considered all evidence, including the
testimony of the applicant, interested parties, and the evaluation and recommendations by staff,
presented at said hearing.
BE IT RESOLVED, by the Planning Commission of the City of San Luis Obispo as follows:
SECTION 1: Action on Final SEIR. The Planning Commission hereby recommends that the City
Council certif y the Final Supplemental Environmental Impact Report (“Final SEIR”) based on the
following CEQA Findings and Mitigation Measures with associated findings:
A.CEQA Findings, Mitigation Measures and Mitigation Monitoring Program. Based
upon all the evidence, the Planning Commission makes the following CEQA findings in
support of the revised San Luis Ranch Project:
1.The certified San Luis Ranch Specific Plan Final Environmental Impact Report (FEIR),
as well as the Supplemental Final EIR were prepared in accordance with the California
Environmental Quality Act (CEQA) and the State CEQA Guidelines, adequately
addressing impacts associated with the proposed project; and
2.The Revised San Luis Ranch Project is consistent with the requirements of the
previously-approved and certified San Luis Ranch Specific Plan FEIR, mitigation
measures, and findings as articulated through City Council Resolution No.10822 (2017
Series) dated July 18, 2017, as augmented by the Final Supplemental EIR based on the
attached Findings and Statement of Overriding Considerations associated with the
revised project, which were prepared consistent with CEQA Guidelines Sections 15091
and 15093, as detailed below, and described more fully in the attached “Findings of Fact
and Statement of Overriding Considerations” document.
3.All potentially significant effects were analyzed adequately in the referenced certified
FEIR and Final SEIR, and reduced to the extent feasible, provided that all mitigation
measures included in the certified Final EIR are incorporated into the project and the
mitigation monitoring program, as modified or augmented through the Final SEIR, as
described below.
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B.SAN LUIS RANCH FINAL SEIR – ADDITIONAL OR MODIFIED MITIGATION
MEASURES
Except as noted below, all mitigation measures included in the certified FEIR would be
applicable to the revised project in their original form. All mitigation measures listed below
are modified from the certified Final EIR, and supersede those in the certified FEIR, with the
exception of Mitigation Measures T-11(a), T-11(b), and T-11(c), which are new mitigation
measures unique to the SEIR.
Transportation Mitigation
T-1(a) Intersection #1: Madonna Road & Los Osos Valley Road.
•City optimize signal timing to accommodate increased project volumes
(ongoing by City)
T-1(b) Intersection #3: Madonna Road & Dalidio Drive/Prado Road.
•Extend existing westbound left turn lane on Madonna Road to Dalidio
Drive/Prado Road to 310’ (Prior to Building Permits or Occupancy)
•Install 2nd westbound 310’ left turn lane on Madonna Road to Dalidio
Drive/Prado Road (Prior to Building Permits or Occupancy)
•Install eastbound 250’ right turn pocket on Madonna Road to Dalidio
Drive/Prado Road (Prior to Building Permits or Occupancy)
•Install 2nd northbound left shared with through-lane on Prado
Road/Dalidio Drive to Madonna Road (Prior to Building Permits or
Occupancy)
•Prohibit westbound U-turns on Madonna Road (Prior to Building Permits
or Occupancy)
•Provide split phase operations & optimize signal timing (Prior to
Building Permits or Occupancy)
T-1(c) Intersection #5: Madonna Road & U.S. 101 Southbound Ramps.
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement).
•Develop a Travel Demand Management Plan consistent with section 2.4.3 and to
the satisfaction of the Public Works Director (Prior to Building Permits or
Occupancy)
T-1(d) Intersection #8: Higuera Street & South Street.
•Optimize Signal Timing (ongoing by City)
T-1(e) Intersection #9: Los Osos Valley Road & Froom Ranch Way.
•Install dedicated 230’ right turn lane on northbound Froom Ranch Way
approach to Los Osos Valley Road (with Froom Ranch Way bridge
construction)
•Extend right turn lane on southbound Froom Ranch Way approach to Los
Osos Valley Road to 110’ (with Froom Ranch Way bridge construction)
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•Install 2nd southbound left turn lane on Froom Ranch Way approach to
eastbound Los Osos Valley Road (with Froom Ranch Way bridge
construction)
T-1(f) Intersection #10: Los Osos Valley Road & Auto Park Way.
•Pay Fair Share Impact fees for Signalization (Prior to Building Permits or
Occupancy)
•Pay Fair share costs and dedicate necessary ROW for construction of the
Prado Road Overpass & NB Ramps (Timing & Amount of Fair Share
Payments as established in San Luis Ranch Development Agreement).
•Develop a Travel Demand Management Plan consistent with section
2.4.3 and to the satisfaction of the Public Works Director (Prior to
Building Permits or Occupancy)
T-1(g) Intersection #16: S. Higuera Street & Tank Farm Road.
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement).
•Develop a Travel Demand Management Plan consistent with section 2.4.3 and to
the satisfaction of the Public Works Director (Prior to Building Permits or
Occupancy)
•Extend northbound right turn pocket to 230’ and channelize movement (Prior to
Building Permits or Occupancy)
T-1(h) Intersection #21: Prado Road/Dalidio Drive & Froom Ranch Way.
•Install multilane roundabout control (when connection is constructed)
T-1(i) Intersection #25: Prado Road/Dalidio Drive & SC Project Driveway.
•Install multilane roundabout control or restricted access (when connection is
constructed)
T-2(a) Intersection #1: Madonna Road & Los Osos Valley Road.
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement). Develop a Travel
Demand Management Plan consistent with section 2.4.3 and to the satisfaction of
the Public Works Director (Prior to Building Permits or Occupancy)
T-2(b) Intersection #2: Madonna Road & Oceanaire Drive.
•Pay Fair share costs and dedicate necessary ROW for construction of the
Prado Road Overpass & NB Ramps (Timing & Amount of Fair Share
Payments as established in San Luis Ranch Development Agreement).
Develop a Travel Demand Management Plan consistent with section
2.4.3 and to the satisfaction of the Public Works Director (Prior to
Building Permits or Occupancy)
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T-2(c) Intersection #5: Madonna Road & U.S. 101 S.B Ramps.
•Extend northbound Madonna Road left turn lane to 150’ (Prior to
Building Permits or Occupancy)
T-2(d) Intersection #6: Madonna Road & U.S. 101 Northbound Ramps.
•Pay Fair share costs and dedicate necessary ROW for construction of the
Prado Road Overpass & NB Ramps (Timing & Amount of Fair Share
Payments as established in San Luis Ranch Development Agreement).
Develop a Travel Demand Management Plan consistent with section
2.4.3 and to the satisfaction of the Public Works Director (Prior to
Building Permits or Occupancy)
T-2(e) Intersection #7: Madonna Road & Higuera Street.
•Pay Fair share costs and dedicate necessary ROW for construction of the
Prado Road Overpass & NB Ramps (Timing & Amount of Fair Share
Payments as established in San Luis Ranch Development Agreement).
Develop a Travel Demand Management Plan consistent with section
2.4.3 and to the satisfaction of the Public Works Director (Prior to
Building Permits or Occupancy)
T-2(f) Intersection #9: Los Osos Valley Road & Froom Ranch Way.
•Install dedicated 230’ right turn lane on Los Osos Valley Road approach
to northbound Froom Ranch Way (with Froom Ranch Way bridge
construction)
•Extend right turn lane on Los Osos Valley Road approach to southbound
Froom Ranch Way to 110’ (with Froom Ranch Way Bridge construction)
•Install 2nd southbound left turn lane on Froom Ranch Way approach to
eastbound Los Osos Valley Road (with Froom Ranch Way bridge
construction)
T-2(g) Intersection #12: Los Osos Valley Road & U.S. 101 Southbound Ramps.
•Extend off-ramp left turn pocket to 320’ (Prior to Building Permits or
Occupancy)
T-2(h) Intersection #13: Los Osos Valley Road & U.S. 101 Northbound Ramps.
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement). Develop a Travel
Demand Management Plan consistent with section 2.4.3 and to the satisfaction
of the Public Works Director (Prior to Building Permits or Occupancy)
T-2(i) Intersection #14: Los Osos Valley Road & Higuera Street.
•Extend eastbound right turn lane to 180’ or as far a practical (Prior to Building
Permits or Occupancy)
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T-2(j) Intersection #18: Prado Road & Higuera Street.
•Install 2nd U.S. 101 northbound left turn lane (Prior to Building Permits or
Occupancy)
•Extend westbound right turn pocket to 400’ (Prior to Building Permits or
Occupancy)
T-3(a) Segments #1 - #6: Madonna Road (Los Osos Valley Road to Higuera
Street)
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement).
•Develop a Travel Demand Management Plan consistent with section 2.4.3 and
to the satisfaction of the Public Works Director (Prior to Building Permits or
Occupancy)
•As part of the TDMP, fund operations and financial assessment/assistance of
decreasing transit headways to 25 minutes (Prior to Building Permits or
Occupancy)
•Construct parallel Class I multiuse path on Madonna between Hwy 101 and
Oceanaire) and Class III Sharrows on Madonna Frontage Road Between
Oceanaire and Los Osos Valley Road (Prior to Building Permits or Occupancy)
T-3(b) Segments #7 - #8: Higuera Street (Madonna Road to Prado Road)
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement). Develop a Travel
Demand Management Plan consistent with section 2.4.3 and to the satisfaction
of the Public Works Director (Prior to Building Permits or Occupancy)
•Pay Fair Share Costs for Construction of Class I Path Parallel to Higuera as
identified in City’s Bicycle Transportation Plan (Prior to Building Permits or
Occupancy)
T-3(c) Segments #13 - #17: Los Osos Valley Road (Madonna Road to Higuera
Street)
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement). Develop a Travel
Demand Management Plan consistent with section 2.4.3 and to the satisfaction
of the Public Works Director (Prior to Building Permits or Occupancy)
•Pay Fair Share Costs for Construction of Class I Path Parallel to Los Osos
Valley Road as identified in City’s Bicycle Transportation Plan (Prior to
Building Permits or Occupancy)
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T-3(d) Segments #18 - #20: Dalidio Drive/Prado Road (Froom Ranch Way to
Higuera Street)
•Construct parallel Class I multiuse paths (Concurrent with
Construction/Widening of Prado Road along project frontages)
T-5 Froom Ranch Way Bridge Timing
•The Froom Ranch Way bridge connection shall be completed prior to any
residential or non-residential building permits or occupancy permits.
T-11(a)Northbound U.S. 101 Prado Road Off Ramp
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB (Timing & Amount of Fair Share Payments as established
in San Luis Ranch Development Agreement).
•Develop a Travel Demand Management Plan consistent with section 2.4.3 and
to the satisfaction of the Public Works Director (Prior to Building Permits or
Occupancy)
T-11(b)Northbound U.S. 101 North of Prado Road
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement).
•Develop a Travel Demand Management Plan consistent with section 2.4.3 and
to the satisfaction of the Public Works Director (Prior to Building Permits or
Occupancy)
T-11(c)Northbound U.S. 101 North of Madonna Road
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement).
•Develop a Travel Demand Management Plan consistent with Section 2.4.3 [as
described below] and to the satisfaction of the Public Works Director (Prior to
Building Permits or Occupancy)
The key components of a Travel Demand Management Plan would
include the following:
Non-Residential Trip Reduction Program
Non- Residential trip reduction programs shall be targeted primarily at
employees since their travel behavior is easier to influence than
customers. A separate customized trip reduction should be developed for
each non-residential use to maximize effectiveness and include but not
be limited to the following.
•A travel demand coordinator that will implement and monitor the
program. The travel demand coordinator will be responsible for
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preparing quarterly reports to the City and working with
employees to minimize automobile travel.
•Participation in SLO Regional Rideshare’s Commute Survey and
Trip Reduction Plan program. This program is provided at no
cost to the employer and results in a Trip Reduction Plan
prepared by Rideshare staff.
•Create an on-site bike share program open to employees and
residents of the project. Monitor usage and supply bicycles as
needed to accommodate demand.
•Provide close-in parking reserved for carpools and vanpools.
•Provide transit pass subsidies to employees.
•Provide on-site bike lockers and showers, on-site bicycle repair
station, and secured bicycle parking.
•Work with Fun Ride and/or Zip Car to provide permanent car
sharing parking spot(s) on site.
Residential Trip Reduction Program
•Consider unbundled parking spaces from multi-family residential
units. This enables households that do not use parking spaces to
save on housing costs. Offer reserved parking spaces for lease or
sale to households who need them. Monitor and adjust the
program as needed to ensure there is no parking spillover into
nearby areas.
•Create a bus pass subsidy program and/or shuttle bus to reduce
vehicle trips.
•Consider operations and financial assessment/assistance of
decreasing transit headways to 25 minutes.
•Provide bicycles as part of the home purchase.
AQ-2(a) Fugitive Dust Control Measures. Construction projects shall
implement the following dust control measures so as to reduce PM10
emissions in accordance with SLOAPCD requirements.
•Reduce the amount of the disturbed area where possible;
•Water trucks or sprinkler systems shall be used during construction in
sufficient quantities to prevent airborne dust from leaving the site. Increased
watering frequency shall be required whenever wind speeds exceed 15 mph.
Reclaimed (non-potable) water or a SLOAPCD-approved dust suppressant
shall be used whenever possible, to reduce the amount of potable water used
for dust control. Please note that since water use is a concern due to drought
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conditions, the contractor or builder shall consider the use of an APCD-
approved dust suppressant where feasible to reduce the amount of water
used for dust control;
SECTION 3. Specific Plan Amendment Approval with Findings & Conditions. The
Planning Commission does hereby recommend that the City Council approve application
SPEC/ANNX/ER-1502-2015, a Specific Plan Amendment to the adopted San Luis Ranch Specific
Plan that would modify the previously-adopted phasing plan that allows up to 580 dwelling units,
including an 80-unit density bonus consistent with City requirements, based on the following
findings, and subject to the conditions of approval incorporated into the Vesting Tentative Tract
Map by the City Council when it approved the project on July 18, 2017, as modified below:
A.Findings:
1.The project area was identified as one of three Specific Plan areas designated for development
when the General Plan Land Use and Circulation Elements update were adopted by the City
Council in December 2014. The San Luis Ranch Specific Plan was prepared to implement this
aspect of the General Plan.
2.The previously-approved San Luis Ranch Specific Plan is consistent with policy direction for
the area included in the General Plan, specifically Land Use Element Policy 8.1.4, which
identifies the San Luis Ranch area as a Special Focus Area (SP-2), subject to policies for the
development of a specific plan and certain broad development parameters and principles. The
Specific Plan is also consistent with all other applicable General Plan policies, as described in
the July 18, 2017, staff report to the City Council, and as discussed further within the Final EIR.
3.The previously-approved General Plan Amendment/Pre-Zoning allows the implementation of
the San Luis Ranch Specific Plan by:
•Updating the City’s Land Use Map to reflect the development pattern included in the
Specific Plan;
•Updating the City’s Circulation Map to reflect the circulation system included in the
Specific Plan;
•Updating the relevant portions of the General Plan to update statistical data related to land
use acreage and long-term buildout potential; and
•Providing the pre-zoning information needed for LAFCo to consider annexation of the
site to the City, which is a prerequisite for allowing development on the site under the
City’s General Plan.
4.As conditioned, the design of the previously-approved Vesting Tentative Tract Map is
consistent with the General Plan because it is consistent with the San Luis Ranch Specific Plan,
it respects existing environmental site constraints, will add to the City’s residential housing
inventory, allow for appropriate non-residential development, and provides needed
infrastructure and roadway improvements identified in the City’s General Plan.
5.The previously-approved Specific Plan project was reviewed by various City advisory bodies,
including the Architectural Review Commission, Bicycle Advisory Committee, Parks and
Recreation Commission, and Cultural Heritage Committee, and incorporates input consistent
with their direction.
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6.The revised project will result in an identical buildout and land use pattern as the previously -
approved project, with the key difference being that the phasing and order of development
would be modified.
7.The Airport Land Use Commission found both the previously-approved and revised Specific
Plan project to be consistent with the adopted Airport Land Use Plan.
8.Development under the Revised San Luis Ranch Project will occur consistent with the Vesting
Tentative Tract Map and the required architectural review process, which will allow for
detailed review of development plans to assure compliance with City plans, policies, and
standards.
9.The Revised San Luis Ranch Project will provide affordable housing consistent with the intent
of California Government Code §65915, and in compliance with City policies and the Housing
Element.
10.The Revised San Luis Ranch Project will comply with all environmental mitigation measures
prescribed in the certified Final EIR, as modified through the Supplemental Final EIR, and
therefore is consistent with the California Environmental Quality Act, as implemented through
the San Luis Ranch Final EIR.
B.Modified Vesting Tentative Tract Map Conditions:
All previously-required conditions applicable to the Vesting Tentative Tract Map would still apply
to the Revised San Luis Ranch Project, except for Condition 6, which would no longer be required,
and would be superseded by updated mitigation measures and provisions within the Development
Agreement that relate to the timing of the Prado Road interchange. In addition, Conditions 7, 9, 10,
14, 20, 22 and 112 will be slightly modified to address the fact that the overall phasing concept has
been changed. In each case, these changes would not materially affect the intent of the condition,
but instead would make them more implementable in the context of the Development Agreement.
The changes to these conditions are shown below with strikeout and underlined text to show deleted
or new text.
No additional conditions are required.
6.Project construction and infrastructure shall be completed in the sequential phase order as
evaluated in the San Luis Ranch Final EIR, or as agreed to between the City and Developer.
If phasing is modified amendments to the Specific Plan and EIR maybe required.
7.Prado Road Interchange. As part of, or prior to, recordation of the final map the subdivider
shall submit an irrevocable offer to dedicate to the City property necessary to construct the
Prado Road Overcrossing and Southbound U.S. 101 Ramps Improvements (“the
Improvements”), and all appurtenances to the satisfaction of the Public Works Director.
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a.Approval of this map is contingent upon the effectiveness of an ordinance approving a
development agreement for the project providing mechanism(s) to fund construction and
maintenance of the Improvements (“Funding Mechanism”).
b.The Development Agreement required by condition 6(a) shall waive the rights of the
applicant, and any future successors in interest to the applicant in the property to oppose
establishment of one or more Funding Mechanisms described in the Development
Agreement or the imposing of any tax, assessment, fee or charge with respect to such a
Funding Mechanism. In the event that voters or property owners dissolve a Funding
Mechanism, a Homeowners Association will be obliged to fund any and all costs for
infrastructure and/or services that the Funding Mechanism would otherwise have funded.
CC&Rs establishing such a Homeowners Association shall be submitted for the
reasonable approval of the City Attorney and recorded before any building permit may
issue for the improvement of the Project.
c.Overcrossing and NB Ramp Improvements Fee Payment. The Funding Mechanism
identified in 7(b) shall be adopted as established in the Development Agreement for this
project before occupancy of Phase 2. The subdivider shall pay its fair share mitigation
fees for the Prado Rd. Overcrossing and Northbound U.S. 101 Ramps Improvements as
established in the Development Agreement for this project prior to the issuance of a
building permit for Phase 2.
d.SB Ramp Improvements Fee Payments. Fair share fees, for the remainder of
improvements, not included in the initial Interchange construction, (future South Bound
Ramps of the Prado Rd. Interchange and all appurtenances) shall be collected prior to
issuance of building permits issued consistent with the provisions of the Development
Agreement for each phase.
9.Enhanced Madonna Pedestrian/Bicycle Crossings. Unless otherwise approved by the Public
Works Director; prior to issuance of building permits for the initial phase of residential
development phase 1 the subdivider shall upgrade the pedestrian crossing at Madonna and
Oceanaire to include curb extensions and a pedestrian refuge island with push button signal
activation. Space for Curb extensions and refuge island should be accommodated by
removing frontage street parking.
Unless otherwise approved by the Public Works Director; prior to issuance of building
permits for the residential multi-family (NG-30) component Phase 3 the subdivider shall
construct a “hawk” pedestrian signal and crossing at the intersection of Dogwood and
Madonna interconnected with the adjacent traffic signals.
10.Dalidio/Prado & Froom a multilane roundabout shall be constructed by the subdivider at the
intersection of Dalidio/Prado & Froom Ranch Way prior to the issuance of building permits.
An interim single lane roundabout is permitted consistent with the provisions of the
Development Agreement for this project prior to issuance of building permits for Phase 2.
Prior to recordation of the final map the applicant shall complete the design of the multilane
roundabout and exhaust all feasible efforts to acquire the necessary off-site dedications,
easements, and agreements for construction all to the satisfaction of the Public Works
Director. If the Developer cannot acquire the necessary land interests to implement this
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mitigation measure, the Public Works Director may authorize the Developer in writing to
modify the alignment and design of the roundabout such that off-site property interests are
not necessary. The Final map shall reflect lot adjustments resulting from final roundabout
design.
Interim all-way stop control as shown in the proposed vesting tentative map or signalization
is not approved.
14.Froom Ranch Widening. Design and construction of Froom Ranch widening to its final cross
section from its existing northern terminus to the LOVR frontage road intersection of Froom
and Los Osos Valley Road including a continuous Class I Multiuse path along the N/W side
and a HAWK signal at the Oceanaire Drive crossing shall be completed prior to issuance of
building permits for Phase 1 unless otherwise deferred by the Community and Public Works
Department Directors. The cross section shall at a minimum include: 12’ class I multi -use
path with two 2’ shoulders, two 6.5’ bicycle lanes, two 11’ travel lanes and a 10’ landscaped
median.
20.As specified in the Development Agreement, Prior to beginning each phase, the subdivider
shall pay its fair share mitigation costs proportional to each phase for the intersection
improvements as prescribed in the project EIR (see Table 123 of Appendix L -Traffic Impact
Study).
22.The final map shall be revised to include a standard “knuckle” design at the intersection of
San Luis Ranch Road and Haystack Place. The knuckle will include emergency access and
pedestrian and bicycle access to the proposed Ped/Bike Bridge and the residential multi-
family (NG-30) component Phase 3.
112.Agricultural Heritage Facility and Learning Center: Prior to issuance of building permits
for the residential multi-family (NG-30) component Phase 3, the proposed relocation and
rehabilitation/reconstruction of buildings at the Agricultural Heritage Facility and Lear ning
Center shall be completed in conformance with Mitigation Measure CR-1(a). Prior to grading
or commencement of any construction activities for infrastructure or building construction, a
security and protection plan shall be submitted and approved to the satisfaction of the
Community Development Director. The plan shall detail methods to prevent trespassing and
prevent removal of any building materials. The plan shall continue to remain in active
implementation prior to development of the residential multi-family (NG-30) component
through Phases 1 & 2, and prior to the relocation action.
SECTION 4: Action of Development Agreement. The Planning Commission does hereby
recommend that the City Council adopt an ordinance approving the Development Agreement for the
Revised San Luis Ranch Project based on the following findings:
a.The proposed Development Agreement attached hereto as Exhibit “B” is consistent with the
General Plan and the San Luis Ranch Specific Plan, both as adopted in July 2017 and as
amended;
b.The proposed Development Agreement complies with zoning, subdivision and other
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applicable ordinances and regulations;
c.As described in the recitals above and the provisions below, the proposed Development
Agreement promotes the general welfare, allows more comprehensive land use planning
within the airport area, and provides substantial public benefits and necessary public
improvements for the region, making it in the city’s interest to enter into the Development
Agreement with the applicant; and
d.The proposed San Luis Ranch project and Development Agreement:
i.Will not adversely affect the health, safety or welfare of persons living or working in
the surrounding area; and
ii.Will be appropriate at the proposed location and will be compatible with adjacent land
uses.
On motion by , seconded by , and on the following roll call vote:
AYES:
NOES:
REFRAIN:
ABSENT:
The foregoing resolution was passed and adopted this 28th day of June, 2018.
_____________________________
Doug Davidson, Secretary
Planning Commission
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SECTION 1. ENVIRONMENTAL DETERMINATION
The City Council of the City of San Luis Obispo considers and relies on the Final Supplemental
Environmental Impact Report (Final SEIR; State Clearinghouse Number 2015101083) for the San
Luis Ranch Specific Plan in determining to carry out the Specific Plan Amendment and
Development Agreement (“Revised San Luis Ranch Specific Plan Project” or “Revised Project”). The
Final SEIR consists of the Draft SEIR, responses to comments on the Draft SEIR, a list of persons and
agencies commenting on the Draft SEIR, a Mitigation Monitoring and Reporting Program, and
technical appendices. It also incorporates by reference the CEQA Findings of Fact and Statement of
Overriding Considerations adopted for the originally approved San Luis Ranch Specific Plan
(“Original Project” or “Approved Project”) on July 18, 2017, which were based on the Final EIR
prepared for Original Project and certified on July 18, 2017. Except where noted below, the
originally adopted CEQA Findings are fully applicable to the Revised Project. The City Council has
received, reviewed, considered, and relied on the information contained in the Final EIR, as well as
information provided at hearings and submissions of testimony from official participating agencies,
the public, and other agencies and organizations.
Section 15091 of the State CEQA Guidelines (14 California Code of Regulations [CCR]) and Section
21081 of the Public Resources Code require a lead agency to adopt findings for each significant
environmental impact disclosed in an EIR. Specifically, for each significant impact, the lead agency
must find that:
•Changes or alterations have been required in, or incorporated into, the project to avoid or substantially
lessen the significant environmental effects identified in the Final EIR;
•Such changes or alterations are within the responsibility and jurisdiction of another public agency
and not the agency making the finding. Such changes have been adopted by such other agency or can
and should be adopted by that agency; or
•Specific economic, social, legal, technological, or other considerations, including provision of
employment opportunities for highly trained workers, make the mitigation measures or project
alternatives identified in the Final EIR infeasible.
The California Code of Regulations, Title 14, Section 15091(b) requires that the City’s findings be
supported by substantial evidence in the record. Accordingly, the Lead Agency’s record consists of
the following, which are located at the City Community Development Department office, San Luis
Obispo, California:
•Documentary and oral evidence, testimony and staff comments and responses received and reviewed
by the Lead Agency during public review and the public hearings on the Original San Luis Ranch
Project.
•The City of San Luis Obispo San Luis Ranch Project Final Environmental Impact Report (certified
July 18, 2017).
•Documentary and oral evidence, testimony and staff comments and responses received and reviewed
by the Lead Agency during public review and the public hearings on the Revised San Luis Ranch
Project.
•The City of San Luis Obispo San Luis Ranch Project Final Supplemental Environmental Impact
Report (June 2018).
In addition to making a finding for each significant impact, if the lead agency approves a project
without mitigating all of the significant impacts, it must prepare a statement of overriding
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considerations, in which it balances the benefits of the project against the unavoidable
environmental risks. The statement of overriding considerations must explain the social, economic,
or other reasons for approving the project despite its environmental impacts (14 CCR 15093, Pub.
Res. Code 21081).
This document contains the findings and statement of overriding considerations for the approval of
the Revised San Luis Ranch Specific Plan Project and reflects the City’s independent judgment. This
document incorporates by reference the Final SEIR. The SEIR, Specific Plan as amended,
Development Agreement, and other portions of the administrative record are available for review
at:
City of San Luis Obispo
Community Development Department
990 Palm Street
San Luis Obispo, CA 93401
Contact: Tyler Corey
(805) 781-7169
Having received, reviewed and considered the foregoing information, as well as any and all
information in the record, the City Council of the City of San Luis Obispo hereby makes these
Findings pursuant to, and in accordance with, Section 21081 of the Public Resources Code.
SECTION 2. PROJECT DESCRIPTION
A. PROJECT OBJECTIVES
As required by the City General Plan, the adopted San Luis Ranch Specific Plan contains policies
and standards that will facilitate appropriate development of land, protection of open space, and
provision of adequate public facilities. The adopted Specific Plan is more detailed than the General
Plan but less precise than subdivision maps or construction plans. The overall objective of the
Revised Project is to update the adopted Specific Plan for the San Luis Ranch project site, pursuant
to the City General Plan. The City’s objectives for the Revised San Luis Ranch Specific Plan are the
same as for the adopted Specific Plan, and include:
1.Provide infill growth for the City that is anticipated and desired by City planning decisions and
guidelines;
2.Preserve agricultural land and open space on site, maintain agricultural views from U.S. 101;
3.Create significant entry-level, workforce housing opportunities within the City that is specifically
“affordable by design;”
4.Implement a walkable-bikeable neighborhood design that is integrated with public transit access and
open space amenities that encourage alternative modes of transportation;
5.Create new commercial, office and hotel opportunities that will accommodate and complement
existing businesses in downtown San Luis Obispo;
6.Develop an Agriculture Heritage Facilities & Learning Center offering seasonal attractions and local
goods that promote the region’s agricultural richness;
7.Establish an important link in the Bob Jones Regional Trail;
8.Provide fair-share financial contribution towards important public circulation improvements.
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B. PROPOSED PROJECT
•Original Project (Adopted Specific Plan). As summarized in the certified Final EIR,
the adopted San Luis Ranch Project consists of a Specific Plan, General Plan Amendment and Pre-
Zone, Development Agreement/Memorandum of Understanding, and Development Plan/Vesting
Tentative Tract Map for a 131-acre project site, including annexation of the site into the City of San
Luis Obispo. The site is located in unincorporated San Luis Obispo County, generally between
Madonna Road and U.S. Highway 101, south of Dalidio Drive, and is identified by assessor’s parcel
number (APN) 067-121-022. The project is intended to be consistent with the development
parameters described in the City’s General Plan Land Use and Circulation Elements, which were
updated in December 2014. The project includes a mixture of residential, commercial, office, and
hotel uses, with approximately 53 acres of the site preserved for agriculture and approximately 7.4
acres preserved for open space uses. The project includes construction of up to 580 residential units,
150,000 square feet of commercial development, 100,000 square feet of office development, and a
200-room hotel.
The City Council unanimously certified the Final EIR and approved the project with minor
modifications on July 18, 2017, pursuant to City Council Resolution No. 10822 (2017 Series). These
minor modifications were found to be consistent with the analysis included in the certified Final
EIR, and thus covered under that document.
•Revised Project (Specific Plan Amendment). After further investigation the applicant
found that the required fixed sequential phasing of development and timing requirements
associated Prado Road Interchange project creates constraints on financing options, which
potentially renders the development project infeasible. In order to address financing constraints, the
project applicant proposes to modify the previously approved project by adjusting the phasing plan
description such that each of the project phases could overlap, be out of sequence, or be concurrent,
depending on market conditions and to adjust project conditions and/or mitigation measures to
implement such adjusted phasing plan, including:
(i)Removing phase numbering from mitigation measures T-1, T-2, & T-3;
(ii)Removing condition of approval #6 “Project construction and infrastructure shall be
completed in the sequential phase order as evaluated in the San Luis Ranch EIR...”;
and
(iii)Revising the mitigation measure monitoring program such that construction of the
Prado Road Overpass and Northbound Ramp is not a requirement prior to
occupancy of Phase 2 or any other project Phase.
•The Prado Overpass and Northbound Ramps project is a joint City and Caltrans effort
currently on schedule to begin construction in 2021. The proposed change in the San Luis Ranch
project description does not affect the interchange sSchedule or the project’s requirement to dedicate
the necessary right-of-way and pay its fair share.
In addition, the revised project includes an amendment to the Specific Plan to permit the
Community Development Director to authorize the developer, in any given year, to also construct
50% of the units allocated to the project in the following year if the Director determines that doing
so is necessary to facilitate construction of beneficial public facilities and infrastructure. The
purpose of this authorization is to realize the public benefits associated with the project, mitigate
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known potential impacts resulting from the project, and implement development requirements,
including infrastructure requirements, which the City has found to be consistent with, and not a
waiver of, the requirements of the City’s Growth Management Ordinance.
These changes would be reflected in the Specific Plan and Development Agreement. No other
approved entitlements would be affected. The proposed revision envisions no change to the land
use plan or development potential compared to what was approved by the City on July 18, 2017.
•These project elements are further described in the Final SEIR, specifically Section 1.3,
Proposed Changes to the Approved Project.
SECTION 3. SUPPLEMENTAL ENVIRONMENTAL IMPACT REPORT
A. BACKGROUND
The City Council unanimously certified a Final EIR and approved the Original Project on July 18,
2017, pursuant to City Council Resolution No. 10822 (2017 Series). A Notice of Determination (NOD)
was prepared, and there were no legal challenges to the adequacy of the Final EIR during the 30-
day statute of limitations associated with the NOD, pursuant to CEQA (PRC Section 21167 and
CEQA Guidelines Section 15094).
The proposed modification to the approved project would only affect the phasing and development
schedule, not the land use pattern or ultimate buildout potential of the project. Nevertheless, this
change requires a Specific Plan Amendment, which is a “discretionary” action that is subject to
CEQA. A Supplement to the Final EIR (or “Supplemental EIR”) was determined to be the
appropriate approach to CEQA compliance pursuant to CEQA Guidelines Section 15163, focusing on
only those issues where potential impacts could be different, or the analysis changed, from what
was included in the certified Final EIR. A Supplemental EIR tiers from the original Final EIR and is
appropriate when only minor changes to an approved project are contemplated.
Section 1.0 of the Final SEIR describes the full legal basis for this determination.
The SEIR serves as an informational document for the public and City of San Luis Obispo decision-
makers. Based on a Planning Commission recommendation, the process will culminate with a City
Council hearing to consider certification of a Final SEIR as well as the applicant’s requested
modifications to the previously-approved project.
B. IMPACT ANALYSIS
Three categories of impacts are identified in both the certified Final EIR and the Final SEIR:
Class I Class I impacts are significant and unavoidable. To approve a project resulting in
Class I impacts, the CEQA Guidelines require decision makers to make findings of
overriding consideration that “specific legal, technological, economic, social, or other
considerations make infeasible the mitigation measures or alternatives identified in
the EIR.”
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Class II Class II impacts are significant but can be mitigated to a level of insignificance by
measures identified in the Final EIR. When approving a project with Class II impacts,
the decision makers must make findings that changes or alternatives to the project
have been incorporated that reduce the impacts to a less than significant level.
Class III Class III impacts are adverse but not significant.
SECTION 4. FINDINGS FOR LESS THAN SIGNIFICANT
ENVIRONMENTAL EFFECTS OF THE PROPOSED PROJECT
The findings below are for Class III impacts. Class III impacts are adverse but not significant.
Modified from those included in the Final EIR and related CEQA Findings, the City Council has
concluded that the following effects are adverse but not significant, as described in the Final SEIR.
G. LAND USE
2.Impact LU-5: The Revised Project would remove fixed sequential phasing, so it is possible that
development could occur more quickly that under the originally approved Specific Plan. The
proposed phasing concept would allow for managed growth pursuant to the San Luis Ranch
Specific Plan. In addition, the overall buildout capacity of the Specific Plan is consistent with
General Plan growth limitations pursuant to Land Use Element Policy 8.1.4, which directs future
development within the San Luis Ranch area. For reasons described on pages 2.3-4 through 2.3-
10 of the Final SEIR, the Revised Project would be consistent with adopted City policies in the
General Plan and Zoning Regulations related to growth management. (Refer to pages 2.3-4
through 2.3-10 of the Final SEIR.)
a.Mitigation: None
b.Finding: The City finds that the impact is less than significant.
SECTION 5. FINDINGS FOR SIGNIFICANT ENVIRONMENTAL
EFFECTS OF THE PROPOSED PROJECT THAT HAVE BEEN
MITIGATED TO A LESS THAN SIGNIFICANT LEVEL
Class II impacts are significant but can be mitigated to a level of insignificance by measures identified in the
EIR. When approving a project with Class II impacts, the decision-makers must make findings that changes
or alterations to the project have been incorporated that reduce the impacts to a less than significant level.
This section presents the project’s significant environmental impacts and feasible mitigation
measures. Section 15091 of the State CEQA Guidelines (14 California Code of Regulations [CCR])
and Section 21081 of the Public Resources Code require a lead agency to make findings for each
significant environmental impact disclosed in an EIR. Specifically, for each significant impact, the
lead agency must find that:
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•Changes or alterations have been required in, or incorporated into, the project to avoid or substantially
lessen the significant environmental effects identified in the Final EIR;
•Such changes or alterations are within the responsibility and jurisdiction o f another public agency
and not the agency making the finding. Such changes have been adopted by such other agency or can
and should be adopted by that agency; or
•Specific economic, social, legal, technological, or other considerations, including provision of
employment opportunities for highly trained workers, make the mitigation measures or project
alternatives identified in the Final EIR infeasible.
Each of these findings must be supported by substantial evidence in the administrative record. This
section identifies impacts that can be fully avoided or reduced to a less-than-significant level
through the incorporation of feasible mitigation measures into the project, as identified in the Final
EIR and Final SEIR. The impacts identified in this section are considered in the same sequence in
which they appear in the Final SEIR.
Modified from those included in the Final EIR and related CEQA Findings, the City Council has
concluded that the following effects are significant but mitigable to a less than significant level, as
described in the Final SEIR. No new impacts have been identified.
B. AIR QUALITY
1.Impact AQ-2: Construction of the project would generate temporary increases in localized air
pollutant emissions. Construction emissions of ROG, NOX, and DPM would exceed SLOAPCD
construction thresholds. However, with implementation of Mitigation Measures AQ-2(a)
through AG-2(e) as included in the SEIR, which require fugitive dust control measures, standard
control measures for construction equipment, Best Available Control Technology (BACT) for
construction equipment, low or no VOC-emission paint for architectural coatings, and
preparation of a Construction Activity Management Plan (CAMP), this impact would be
reduced to a less than significant level. (Refer to pages 2.1-4 through 2.1-11 of the Final SEIR;
impact and mitigation is not new, but Mitigation Measure AQ-2(a) is modified from Final EIR.)
a.Mitigation: The following mitigation measures are required to reduce construction
emissions of ROG, NOX, DPM, and fugitive dust.
— Mitigation Measure AQ-2(a) Fugitive Dust Control Measures. Construction projects
shall implement the following dust control measures so as to reduce PM10 emissions in
accordance with SLOAPCD requirements.
•Reduce the amount of the disturbed area where possible;
•Water trucks or sprinkler systems shall be used during construction in sufficient
quantities to prevent airborne dust from leaving the site. Increased watering
frequency shall be required whenever wind speeds exceed 15 mph. Reclaimed (non-
potable) water or a SLOAPCD-approved dust suppressant shall be used whenever
possible, to reduce the amount of potable water used for dust control. Please note
that since water use is a concern due to drought conditions, the contractor or builder
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shall consider the use of an APCD-approved dust suppressant where feasible to
reduce the amount of water used for dust control;
•All dirt stock pile areas shall be sprayed daily as needed;
•Permanent dust control measures identified in the approved project revegetation and
landscape plans shall be implemented as soon as possible following completion of
any soil disturbing activities;
•Exposed ground areas that are planned to be reworked at dates greater than one
month after initial grading shall be sown with a fast germinating, non-invasive grass
seed and watered until vegetation is established;
•All disturbed soil areas not subject to revegetation shall be stabilized using approved
chemical soil binders, jute netting, or other methods approved in advan ce by the
SLOAPCD;
•All roadways, driveways, sidewalks, etc. to be paved shall be completed as soon as
possible after grading unless seeding or soil binders are used;
•Vehicle speed for all construction vehicles shall not exceed 15 mph on any unpaved
surface at the construction site;
•All trucks hauling dirt, sand, soil, or other loose materials are to be covered or shall
maintain at least two feet of freeboard (minimum vertical distance between top of
load and top of trailer) in accordance with California Vehicle Code Section 23114;
•Install wheel washers where vehicles enter and exit unpaved roads onto streets, or
wash off trucks and equipment leaving the site;
•Sweep streets at the end of each day if visible soil material is carried onto adjacent
paved roads. Water sweepers with reclaimed water shall be used where feasible;
•All of these fugitive dust mitigation measures shall be shown on grading and
building plans; and
•The contractor or builder shall designate a person or persons to monitor the fugitive
dust emissions and enhance the implementation of the measures as necessary to
minimize dust complaints, reduce visible emissions below 20 percent opacity, and to
prevent transport of dust offsite. Their duties shall include holidays and weekend
periods when work may not be in progress. The name and telephone number of such
persons shall be provided to the SLOAPCD Compliance Division prior to the start of
any grading, earthwork or demolition.
— Mitigation Measure AQ-2(b) Standard Control Measures for Construction Equipment.
The following standard air quality mitigation measures shall be implemented during
construction activities at the project site:
•Maintain all construction equipment in proper tune according to manufacturer’s
specifications;
•Fuel all off-road and portable diesel powered equipment with ARB certified motor
vehicle diesel fuel (non-taxed version suitable for sue off-road);
•Use diesel construction equipment meeting ARB’s Tier 2 certified engines or cleaner
off-road heavy-duty diesel engines, and comply with the State Off-Road Regulation;
•Use on-road heavy-duty trucks that meet the ARB’s 2007 or cleaner certification
standard for on-road heavy-duty diesel engines, and comply with the State On-Road
Regulation;
•Construction or trucking companies with fleets that do not have engines in their fleet
that meet the engine standards identified in the above two measures (e.g. captive or
NOX exempt area fleets) may be eligible by proving alternative compliance;
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•On-road diesel vehicles shall comply with Section 2485 of Title 13 of the California
Code of Regulations. This regulation limits idling from diesel-fueled commercial
motor vehicles with gross vehicular weight ratings of more than 10,000 pounds and
licensed for operation on highways. It applies to California and non-California based
vehicles. In general, the regulation specifies that drivers of said vehicles:
1.Shall not idle the vehicle's primary diesel engine for greater than 5-
minutes at any location, except as noted in Subsection (d) of the
regulation; and,
2.Shall not operate a diesel-fueled auxiliary power system (APS) to power
a heater, air conditioner, or any ancillary equipment on that vehicle
during sleeping or resting in a sleeper berth for greater than 5.0 minutes
at any location when within 1,000 feet of a restricted area, except as
noted in Subsection (d) of the regulation.
•Off-road diesel equipment shall comply with the 5-minute idling restriction
identified in Section 2449(d)(2) of the California Air Resources Board's In-Use Off-
Road Diesel regulation.
•Signs shall be posted in the designated queuing areas and or job sites to remind
drivers and operators of the 5 minute idling limit;
•In addition to the state required diesel idling requirements, the project applicant shall
comply with these more restrictive requirements to minimize impacts to nearby
sensitive receptors:
1.Signs that specify the no idling areas shall be posted and enforced at the site.
2.Diesel idling within 1,000 feet of sensitive receptors is not permitted;
3.Staging and queuing areas shall not be located within 1,000 feet of
sensitive receptors;
4.Use of alternative fueled equipment is recommended;
•Electrify equipment when feasible;
•Substitute gasoline-powered in place of diesel-powered equipment, where feasible;
and
•Use alternatively fueled construction equipment on-site where feasible, such as
compressed natural gas (CNG), liquefied natural gas (LNG), propane or biodiesel.
— Mitigation Measure AQ-2(c) Best Available Control Technology (BACT) for
Construction Equipment. The following BACT for diesel-fueled construction equipment
shall be implemented during construction activities at the project site, where feasible:
•Further reducing emissions by expanding use of Tier 3 and Tier 4 off-road and 2010
on-road compliant engines where feasible;
•Repowering equipment with the cleanest engines available; and
•Installing California Verified Diesel Emission Control Strategies, such as level 2
diesel particulate filters. These strategies are listed at:
http://www.arb.ca.gov/diesel/verdev/vt/cvt.htm
— Mitigation Measure AQ-2(d) Architectural Coating. To reduce ROG and NOX levels
during the architectural coating phase, low or no VOC-emission paint shall be used with
levels of 50 g/L or less.
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— Mitigation Measure AQ-2(e) Construction Activity Management Plan. Emissions
reduction measures and construction practices required to comply with Mitigation
Measures AQ-2(a) through AQ-2(d) shall be documented in a Construction Activity
Management Plan (CAMP) and submitted to SLOAPCD for review and approval at least
three months before the start of construction. The CAMP shall include a Dust Control
Management Plan, tabulation of on and off-road construction equipment (age, horse-
power and miles and/or hours of operation), construction truck trip schedule,
construction work-day period, and construction phasing. If implementation of the
Standard Mitigation and Best Available Control Technology measures cannot bring the
project below the Tier 1 threshold (2.5 tons of NOX+ROG per quarter), off-site mitigation
shall be implemented in coordination with SLOAPCD to reduce NOX and ROG
emissions to below the Tier 1 threshold.
b.Finding: The City finds that changes or alterations have been required in, or incorporated
into, the project to avoid or lessen to a less than significant level the significant
environmental effects identified in the Final SEIR.
K. TRANSPORTATION
1.Impact T-5: The timing of construction of the proposed Froom Ranch Way bridge would result
in significant level of service and queuing impacts at study area intersections and roadway
segments. Mitigation Measure T-5, Froom Ranch Way Bridge Timing, would ensure that LOS
and queuing impacts associated with the project’s proposed infrastructure phasing would be
less than significant after mitigation. (Refer to pages 2.4-9 and 2.4-16 of the Final SEIR.)
a.Mitigation: The following mitigation is required to reduce potentially significant LOS and
queuing impacts that would result from the project’s proposed infrastructure phasing.
— Mitigation Measure T-5 Froom Ranch Way Bridge Timing. The Froom Ranch Way
bridge connection shall be completed prior to any residential or non-residential building
permits or occupancy permits.
b.Finding: The City finds that changes or alterations have been required in, or incorporated
into, the project to avoid or lessen to a less than significant level the significant
environmental effects identified in the Final EIR.
SECTION 6. SIGNIFICANT UNAVOIDABLE ENVIRONMENTAL
EFFECTS OF THE PROPOSED PROJECT FOR WHICH SUFFICIENT
MITIGATION IS NOT AVAILABLE
Class I impacts are significant and unavoidable. To approve a project resulting in Class I impacts, the
CEQA Guidelines require decision makers to make findings of overriding consideration that "... specific
legal, technological, economic, social, or other considerations make infeasible the mitigation measures or
alternatives identified in the EIR...".
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This section presents the project’s significant environmental impacts and feasible mitigation
measures. Section 15091 of the State CEQA Guidelines (14 California Code of Regulations [CCR])
and Section 21081 of the Public Resources Code require a lead agency to make findings for each
significant environmental impact disclosed in an EIR. Specifically, for each significant impact, the
lead agency must find that:
•Changes or alterations have been required in, or incorporated into, the project to avoid or substantially
lessen the significant environmental effects identified in the Final EIR;
•Such changes or alterations are within the responsibility and jurisdiction of another public agency
and not the agency making the finding. Such changes have been adopted by such other agency or can
and should be adopted by that agency; or
•Specific economic, social, legal, technological, or other considerations, including provision of
employment opportunities for highly trained workers, make the mitigation measures or project
alternatives identified in the Final EIR infeasible.
Each of these findings must be supported by substantial evidence in the administrative record. This
section identifies impacts that can be reduced, but not to a less-than-significant level, through the
incorporation of feasible mitigation measures into the project, and which therefore, remain
significant and unavoidable, as identified in the Final EIR and Final SEIR. The impacts identified in
this section are considered in the same sequence in which they appear in the SEIR. Where adoption
of feasible mitigation measures is not effective in avoiding an impact or reducing it to a less-than-
significant level, the feasibility of adopting alternatives to the proposed project is considered in
Section 7 of this document.
Modified from those included in the Final EIR and related CEQA Findings, the City Council has
concluded that the following effects are significant and unavoidable, and cannot be mitigated to a
less than significant level, as described in the Final SEIR. One additional significant and unavoidable
impact not identified in the Final EIR is also described below.
E. TRANSPORTATION
1.Impact T-1: Under Existing and Near-Term Plus Project conditions 9 study area intersections
would operate at unacceptable automobile, bicycle, or pedestrian LOS based on adopted
multimodal level of service standards during AM and PM peak hours. Of these 9 intersections,
impacts to Madonna Road & U.S. 101 SB, Los Osos Valley Road & Auto Park Way, and Higuera
& Tank Farm would be temporary until the Prado Road Overpass & NB Ramps are constructed.
Although temporary, the impact at these three locations would be Class I, significant and
unavoidable.
a.Mitigation: Mitigation Measures T-1(a) through T-1(i) identify improvements at study area
facilities that are required to reduce potentially significant project-specific impacts at study
area intersections under Existing and Near-Term Plus Project Conditions. The project’s
equitable share of these improvements will be calculated using the method for calculating
equitable mitigation measures outlined in the Caltrans Guide for the Preparation of Traffic
Impact Studies (Caltrans, December 2002). Costs above and beyond the project’s equitable
share can be addressed through such options as fee credits, reimbursement agreements, or
development agreements, based on City requirements. Implementation of Mitigation
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Measures T-1(a) through T-1(i) would reduce impacts to multimodal level of service at study
area intersections under Existing and Near-Term Plus Project conditions to a feasible extent.
T-1(a) Intersection #1: Madonna Road & Los Osos Valley Road.
•City optimize signal timing to accommodate increased project volumes
(ongoing by City)
T-1(b) Intersection #3: Madonna Road & Dalidio Drive/Prado Road.
•Extend existing westbound left turn lane on Madonna Road to Dalidio
Drive/Prado Road to 310’ (Prior to Building Permits or Occupancy)
•Install 2nd westbound 310’ left turn lane on Madonna Road to Dalidio
Drive/Prado Road (Prior to Building Permits or Occupancy)
•Install eastbound 250’ right turn pocket on Madonna Road to Dalidio
Drive/Prado Road (Prior to Building Permits or Occupancy)
•Install 2nd northbound left shared with through-lane on Prado Road/Dalidio
Drive to Madonna Road (Prior to Building Permits or Occupancy)
•Prohibit westbound U-turns on Madonna Road (Prior to Building Permits or
Occupancy)
•Provide split phase operations & optimize signal timing (Prior to Building
Permits or Occupancy)
T-1(c) Intersection #5: Madonna Road & U.S. 101 Southbound Ramps.
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado Road
Overpass & NB Ramps (Timing & Amount of Fair Share Payments as established in
San Luis Ranch Development Agreement).
•Develop a Travel Demand Management Plan consistent with section 2.4.3 and to the
satisfaction of the Public Works Director (Prior to Building Permits or Occupancy)
T-1(d) Intersection #8: Higuera Street & South Street.
•Optimize Signal Timing (ongoing by City)
T-1(e) Intersection #9: Los Osos Valley Road & Froom Ranch Way.
•Install dedicated 230’ right turn lane on northbound Froom Ranch Way
approach to Los Osos Valley Road (with Froom Ranch Way bridge
construction)
•Extend right turn lane on southbound Froom Ranch Way approach to Los Osos
Valley Road to 110’ (with Froom Ranch Way bridge construction)
•Install 2nd southbound left turn lane on Froom Ranch Way approach to
eastbound Los Osos Valley Road (with Froom Ranch Way bridge construction)
T-1(f) Intersection #10: Los Osos Valley Road & Auto Park Way.
•Pay Fair Share Impact fees for Signalization (Prior to Building Permits or
Occupancy)
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement).
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•Develop a Travel Demand Management Plan consistent with section 2.4.3 and
to the satisfaction of the Public Works Director (Prior to Building Permits or
Occupancy)
T-1(g) Intersection #16: S. Higuera Street & Tank Farm Road.
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement).
•Develop a Travel Demand Management Plan consistent with section 2.4.3 and
to the satisfaction of the Public Works Director (Prior to Building Permits or
Occupancy)
•Extend northbound right turn pocket to 230’ and channelize movement (Prior
to Building Permits or Occupancy)
T-1(h) Intersection #21: Prado Road/Dalidio Drive & Froom Ranch Way.
•Install multilane roundabout control (when connection is constructed)
T-1(i) Intersection #25: Prado Road/Dalidio Drive & SC Project Driveway.
•Install multilane roundabout control or restricted access (when connection is
constructed)
b.Finding: While the mitigation measures identified in the Final SEIR are feasible, they
insufficient to reduce potential impacts to a less than significant level. Implementation of the
identified mitigation measures would improve LOS at six impacted intersections to
acceptable levels, so impacts on these facilities would be less than significant after
mitigation. However, impacts associated with multimodal level of service standards at three
impacted intersections (Madonna & U.S. 101 SB Ramp, Los Osos Valley Road & AutoPark
Way, and Higuera & Tank Farm) would remain significant and unavoidable. A statement
of overriding considerations for this impact is made in Section 8.
2.Impact T-2: Under Existing and Near-Term Plus Project conditions the volume of traffic at 19
study area intersections would exceed lane capacities. Of these 19 intersections, impacts to
Madonna & Los Osos Valley Road, Madonna & Oceanaire, Madonna & U.S. 101 NB, Madonna
& Higuera, and Los Osos Valley Road & U.S. 101 NB would be temporary until the Prado Road
Overpass & NB Ramps are constructed. Although temporary, the impact at these five locations
would be Class I, significant and unavoidable. (Refer to pages 2.4-9 and 2.4-12 through 2.4-14 of
the Final SEIR.)
a.Mitigation: Mitigation Measures T-2(a) through T-2(j) identify improvements at study area
facilities that are required to reduce potentially significant project-specific impacts at study
area intersections under Existing and Near-Term Plus Project Conditions. The project’s
equitable share of these improvements will be calculated using the method for calculating
equitable mitigation measures outlined in the Caltrans Guide for the Preparation of Traffic
Impact Studies (Caltrans, December 2002). Costs above and beyond the project’s equitable
share can be addressed through such options as fee credits, reimbursement agreements, or
development agreements, based on City requirements. Implementation of Mitigation
Measures T-2(a) through T-2(j) would reduce impacts associated with lane capacities
identified for Existing and Near-Term Plus Project conditions to a feasible extent.
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T-2(a) Intersection #1: Madonna Road & Los Osos Valley Road.
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement). Develop a Travel
Demand Management Plan consistent with section 2.4.3 and to the satisfaction
of the Public Works Director (Prior to Building Permits or Occupancy)
T-2(b) Intersection #2: Madonna Road & Oceanaire Drive.
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement). Develop a Travel
Demand Management Plan consistent with section 2.4.3 and to the satisfaction
of the Public Works Director (Prior to Building Permits or Occupancy)
T-2(c) Intersection #5: Madonna Road & U.S. 101 S.B Ramps.
•Extend northbound Madonna Road left turn lane to 150’ (Prior to Building
Permits or Occupancy)
T-2(d) Intersection #6: Madonna Road & U.S. 101 Northbound Ramps.
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement). Develop a Travel
Demand Management Plan consistent with section 2.4.3 and to the satisfaction
of the Public Works Director (Prior to Building Permits or Occupancy)
T-2(e) Intersection #7: Madonna Road & Higuera Street.
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement). Develop a Travel
Demand Management Plan consistent with section 2.4.3 and to the satisfaction
of the Public Works Director (Prior to Building Permits or Occupancy)
T-2(f) Intersection #9: Los Osos Valley Road & Froom Ranch Way.
•Install dedicated 230’ right turn lane on Los Osos Valley Road approach to
northbound Froom Ranch Way (with Froom Ranch Way bridge construction)
•Extend right turn lane on Los Osos Valley Road approach to southbound
Froom Ranch Way to 110’ (with Froom Ranch Way Bridge construction)
•Install 2nd southbound left turn lane on Froom Ranch Way approach to
eastbound Los Osos Valley Road (with Froom Ranch Way bridge construction)
T-2(g) Intersection #12: Los Osos Valley Road & U.S. 101 Southbound Ramps.
•Extend off-ramp left turn pocket to 320’ (Prior to Building Permits or
Occupancy)
T-2(h) Intersection #13: Los Osos Valley Road & U.S. 101 Northbound Ramps.
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement). Develop a Travel
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Demand Management Plan consistent with section 2.4.3 and to the satisfaction
of the Public Works Director (Prior to Building Permits or Occupancy)
T-2(i) Intersection #14: Los Osos Valley Road & Higuera Street.
•Extend eastbound right turn lane to 180’ or as far a practical (Prior to Building
Permits or Occupancy)
T-2(j) Intersection #18: Prado Road & Higuera Street.
•Install 2nd U.S. 101 northbound left turn lane (Prior to Building Permits or
Occupancy)
•Extend westbound right turn pocket to 400’ (Prior to Building Permits or
Occupancy)
b.Finding: Implementation of the identified mitigation measures would improve capacity at
five impacted intersections to acceptable levels, so impacts on these facilities would be less
than significant after mitigation. However, impacts associated with capacity at six other
intersections (Madonna & Los Osos Valley Road, Madonna & Oceanaire, Madonna & U.S.
101 NB Ramps, Madonna & U.S. 101 SB Ramps, Madonna & Higuera, and Los Osos Valley
Road & U.S. 101 NB Ramps) would remain significant and unavoidable. A statement of
overriding considerations for this impact is made in Section 8.
3.Impact T-3: Under Existing and Near-Term Plus Project conditions 4 study area segment groups
would operate at unacceptable automobile, bicycle, pedestrian, and/or transit LOS based on
adopted multimodal level of service standards during AM and PM peak hours. Of these 4
segment groups, impacts to Madonna (Los Osos Valley Road to Higuera) and Los Osos Valley
Road (Madonna to Higuera) would be temporary until the Prado Road Overpass & NB Ramps
are constructed. Although temporary, the impact along these two segment groups would be
Class I, significant and unavoidable. (Refer to pages 2.4-9, 2.4-14 and 2.4-15 of the Final SEIR.)
a.Mitigation: Mitigation Measures T-3(a) through T-3(d) identify improvements at study area
facilities that are required to reduce potentially significant project-specific impacts at study
area roadway segments under Existing and Near-Term Plus Project Conditions. The
project’s equitable share of these improvements will be calculated using the method for
calculating equitable mitigation measures outlined in the Caltrans Guide for the Preparation
of Traffic Impact Studies (Caltrans, December 2002). Costs above and beyond the project’s
equitable share can be addressed through such options as fee credits, reimbursement
agreements, or development agreements, based on City requirements. Implementation of
Mitigation Measures T-3(a) through T-3(d) would reduce impacts associated with
multimodal level of service standards at study area roadway segments identified for
Existing and Near-Term Plus Project conditions to a feasible extent.
T-3(a) Segments #1 - #6: Madonna Road (Los Osos Valley Road to Higuera Street)
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement).
•Develop a Travel Demand Management Plan consistent with section 2.4.3 and
to the satisfaction of the Public Works Director (Prior to Building Permits or
Occupancy)
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•As part of the TDMP, fund operations and financial assessment/assistance of
decreasing transit headways to 25 minutes (Prior to Building Permits or
Occupancy)
•Construct parallel Class I multiuse path on Madonna between Hwy 101 and
Oceanaire) and Class III Sharrows on Madonna Frontage Road Between
Oceanaire and Los Osos Valley Road (Prior to Building Permits or Occupancy)
T-3(b) Segments #7 - #8: Higuera Street (Madonna Road to Prado Road)
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement). Develop a Travel
Demand Management Plan consistent with section 2.4.3 and to the satisfaction
of the Public Works Director (Prior to Building Permits or Occupancy)
•Pay Fair Share Costs for Construction of Class I Path Parallel to Higuera as
identified in City’s Bicycle Transportation Plan (Prior to Building Permits or
Occupancy)
T-3(c) Segments #13 - #17: Los Osos Valley Road (Madonna Road to Higuera
Street)
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement). Develop a Travel
Demand Management Plan consistent with section 2.4.3 and to the satisfaction
of the Public Works Director (Prior to Building Permits or Occupancy)
•Pay Fair Share Costs for Construction of Class I Path Parallel to Los Osos
Valley Road as identified in City’s Bicycle Transportation Plan (Prior to
Building Permits or Occupancy)
T-3(d) Segments #18 - #20: Dalidio Drive/Prado Road (Froom Ranch Way to
Higuera Street)
•Construct parallel Class I multiuse paths (Concurrent with
Construction/Widening of Prado Road along project frontages)
b.Finding: Implementation of the identified mitigation measures would improve multimodal
level of service at one impacted segment to acceptable levels, so impacts on this facility
would be less than significant after mitigation. However, impacts associated with
multimodal segment level of service at three other segments (Madonna Road (Los Osos
Valley Road to Higuera Street), Higuera Street (Madonna Road to Prado Road), Los Osos
Valley Road (Madonna Road to Higuera Street) would remain significant and unavoidable.
A statement of overriding considerations for this impact is made in Section 8.
4.Impact T-11: Under Existing and Near-term Plus Project conditions buildout of the project prior
to construction of the Prado Road Overpass & NB ramps would result in portions of Highway
101 from Marsh Street to Los Osos Valley Road operating below Caltrans level of service
standards. This is a Class I, significant and unavoidable impact. (Refer to pages 2.4-9, 2.4-10,
2.4-16, and 2.4-17 of the Final SEIR.)
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a.Mitigation: Implementation of Mitigation Measures T-11(a) through T-8(c) would reduce
impacts to mainline operations on U.S. Highway 101 in the vicinity of the project to the
extent feasible.
T-11(a) Northbound U.S. 101 Prado Road Off Ramp
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement).
•Develop a Travel Demand Management Plan consistent with section 2.4.3 and
to the satisfaction of the Public Works Director (Prior to Building Permits or
Occupancy)
T-11(b) Northbound U.S. 101 North of Prado Road
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement).
•Develop a Travel Demand Management Plan consistent with section 2.4.3 and
to the satisfaction of the Public Works Director (Prior to Building Permits or
Occupancy)
T-11(c) Northbound U.S. 101 North of Madonna Road
•Pay Fair share costs and dedicate necessary ROW for construction of the Prado
Road Overpass & NB Ramps (Timing & Amount of Fair Share Payments as
established in San Luis Ranch Development Agreement).
•Develop a Travel Demand Management Plan consistent with section 2.4.3 and
to the satisfaction of the Public Works Director (Prior to Building Permits or
Occupancy)
b.Finding: Implementation of the identified mitigation measures would lessen project
volumes on the Highway 101 mainline and mitigate interim impacts to the maximum extent
feasible. However, impacts associated with mainline Highway 101 operations would remain
significant and unavoidable. A statement of overriding considerations for this impact is
made in Section 8.
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SECTION 7. FINDINGS FOR ALTERNATIVES TO THE REVISED
PROJECT
Various alternatives to the Original Project were considered in the Final EIR to reduce one or more
environmental impacts associated with the project. For the Revised Project, a Supplemental EIR
(SEIR) was prepared because only minor changes were contemplated from the originally approved
project, and no changes to the approved land use pattern or buildout potential were contemplated.
An SEIR is not required to consider additional project alternatives, and in this case did not.
No Findings related to Alternatives are required or can be made for the Revised Project.
SECTION 8. STATEMENT OF OVERRIDING CONSIDERATIONS
A.INTRODUCTION
Based on the certified Final EIR for the originally approved project, as modified by the findings of
the Final SEIR, the following significant and unavoidable impacts are associated with the Revised
Project:
1.The Revised Project would be inconsistent with the SLOAPCD 2001 Clean Air Plan because
it would result in an increase in vehicle miles traveled (VMT) that would exceed the rate of
population growth.
2.The Revised Project is inconsistent with the 2001 Clean Air Plan, which SLOAPCD guidance
states is a cumulative air quality impact.
3.The Revised Project would result in the relocation, demolition, and removal of structures on
the San Luis Ranch property which are individually identified as historic resources. In
addition, the project would eliminate the San Luis Ranch Complex, which is eligible for
listing as a historic resource. Relocation, demolition, and/or removal of these historic
resources would permanently alter the historic context of the project site and on-site
structures.
4.Removal of the San Luis Ranch Complex would contribute to the cumulative loss of historic
resources in the City.
5.The Revised Project would be potentially inconsistent with adopted City policies in the
General Plan designed to protect historical resources and ensure adequate multimodal
transportation levels of service.
6.Temporary construction activity would create noise that could exceed City of San Luis
Obispo Municipal Code regulations, and mitigation may not be feasible to reduce the impact
to less than the applicable threshold.
7.Under Existing and Near-Term Plus Project conditions 9 study area intersections would
operate at unacceptable automobile, bicycle, or pedestrian LOS based on adopted
multimodal level of service standards during AM and PM peak hours. Of these 9
intersections, impacts to Madonna Road & U.S. 101 SB, Los Osos Valley Road & Auto Park
Way, and Higuera & Tank Farm would be temporary until the Prado Road Overpass & NB
Ramps are constructed. Although temporary, the impact at these three locations would be
significant and unavoidable.
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8.Under Existing and Near-Term Plus Project conditions the volume of traffic at 19 study area
intersections would exceed lane capacities. Of these 19 intersections, impacts to Madonna &
Los Osos Valley Road, Madonna & Oceanaire, Madonna & U.S. 101 NB, Madonna &
Higuera, and Los Osos Valley Road & U.S. 101 NB would be temporary until the Prado Road
Overpass & NB Ramps are constructed. Although temporary, the impact at these five
locations would be significant and unavoidable..
9.Under Existing and Near-Term Plus Project conditions 4 study area segment groups would
operate at unacceptable automobile, bicycle, pedestrian, and/or transit LOS based on
adopted multimodal level of service standards during AM and PM peak hours. Of these 4
segment groups, impacts to Madonna (Los Osos Valley Road to Higuera) and Los Osos
Valley Road (Madonna to Higuera) would be temporary until the Prado Road Overpass &
NB Ramps are constructed. Although temporary, the impact along these two segment
groups would be significant and unavoidable.
10.Under Cumulative Plus Project conditions nine study area intersections would operate at
unacceptable automobile, bicycle, or pedestrian LOS based on adopted multimodal level of
service standards during AM and PM peak hours. Mitigation would reduce impacts at seven
of these intersections to an acceptable level. However, impacts at the Madonna Road &
Dalidio Drive and Los Osos Valley Road & Froom Ranch Way intersections would be
significant and unavoidable.
11.Under Cumulative Plus Project conditions, the volume of traffic at 18 study area
intersections would exceed lane capacities. Mitigation would reduce impacts at 17 of these
intersections to an acceptable level. However, impacts at the Madonna Road & Dalidio Drive
and Los Osos Valley Road & Froom Ranch Way intersections would be significant and
unavoidable.
12.Under Existing and Near-term Plus Project conditions buildout of the project prior to
construction of the Prado Road Overpass & NB ramps would result in portions of Highway
101 from Marsh Street to Los Osos Valley Road operating below Caltrans level of service
standards. This is a significant and unavoidable impact.
For projects which would result in significant environmental impacts that cannot be avoided, CEQA
requires that the lead agency balance the benefits of these projects against the unavoidable
environmental risks in determining whether to approve the projects. If the benefits of these projects
outweigh the unavoidable impacts, those impacts may be considered acceptable (CEQA Guidelines
Section 15093[a]). CEQA requires that, before adopting such projects, the public agency adopt a
Statement of Overriding Considerations setting forth the reasons why the agency finds that the
benefits of the project outweigh the significant environmental effects caused by the project. This
statement is provided below.
B. REQUIRED FINDINGS
The City has incorporated all feasible mitigation measures into the Revised Project. Although these
measures will lessen the unavoidable impacts listed above, the measures will not fully avoid these
impacts.
In preparing this Statement of Overriding Considerations, the City has balanced the benefits of the
proposed project against its unavoidable environmental risks. For the reasons specified below, the
City finds that the following considerations outweigh the Revised Project’s unavoidable
environmental risks:
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1.Provision of new Residential and Commercial Uses. The San Luis Ranch Specific Plan will
develop a new residential neighborhood that fulfills a portion of the City’s unmet housing needs
and that designates sufficient land for neighborhood serving commercial uses to provide for the
convenience of area residents, consistent with Land Use Element Policies 2.3.6, 3.3.1, and 8.1.4.
2.Provision of a Variety of Housing Types for all Income Levels. The San Luis Ranch Specific
Plan provides a variety of housing types and costs to meet the needs of renters and buyers with
a variety of income-levels, including inclusionary affordable housing for residents with
moderate, low, and very-low income levels, consistent with General Plan Land Use Element
Goal 2, Affordability.
3.Open Space and Agricultural Protection: Implementation of the San Luis Ranch Specific Plan
would preserve approximately 53 acres of the site in agriculture adjacent to the San Luis Obispo
City Farm, including development of the agricultural heritage facilities & learning center, which
would relocate and preserve historically important structures from the San Luis Ranch Complex
and integrate them into an enhanced and inter-connected, working agricultural setting. The
project would also preserve approximately 7.4 acres of the site in open space.
4.Provision of Park and Recreational Facilities. The San Luis Ranch Specific Plan will provide a
variety of park and recreational facilities for residents of the City, such as parks, trails and other
recreational facilities, and passive recreational opportunities within open space, both by
constructing facilities on site and providing needed funding for enhancement of existing offsite
City park and recreational facilities.
5.Well-Planned Neighborhood Would Reduce Per-Capita Vehicle Trips: The San Luis Ranch
Specific Plan would develop a new residential neighborhood to meet the City’s housing needs
and that designates sufficient land for neighborhood serving commercial uses to reduce vehicle
trips and provide for the convenience of area residents. In addition, the San Luis Ranch Specific
Plan encourages the use of bicycles and walking within the Plan Area by including specific
policies and development standards that will result in subdivision and building designs that
facilitate bike use and pedestrian access and incorporating multiple classes of bike lanes and
including bike and pedestrian paths through the parks and open space areas.
6.Provision of New Jobs: The project would create new construction-related and permanent jobs
in the project area. Planned commercial development would provide jobs in close proximity to
housing, consistent with Community Goal 34 in the General Plan Land Use Element and Land
Use Element Policy 1.5, which states that the gap between housing demand and supply should
not increase.
7.Transient Occupancy Tax: Development of commercial hotel uses would contribute Transient
Occupancy Tax revenues that help fund needed City services.
8.National Flood Insurance Program (NFIP) and the Community Rating System (CRS) Rating
Improvement: The proposed significant dedication of acreage for designated Natural Beneficial
Functions (CRS Activity 420) would improve the City’s point total with the CRS point system.
The City has improved its CRS rating steadily from a Class 10 community to a Class 6
community. The improvement in class is directly related to a reduction in flood insurance
premiums citywide.
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9.Implementation of the General Plan: As required by the City General Plan, the San Luis Ranch
Specific Plan contains policies and standards that will facilitate appropriate development of
land, protection of open space, and provision of adequate public facilities consistent with the
City’s recent LUCE update and the housing and transportation objectives.
10.Prado Road Interchange. Beyond mitigation for the Project, the Prado Road Interchange
provides enhanced operations of State and Local roadways, improved mobility of bicyclists and
pedestrians, improves transit performance and transit opportunities, and is ranked as the top
sustainable communities infrastructure project in the region. San Luis Ranch is a critical funding
partner in implementing the interchange, if San Luis Ranch does not proceed there will not be
enough funding to complete the interchange.
Accordingly, the City finds that the project’s adverse, unavoidable environmental impacts are
outweighed by these considerable benefits.
Dated: ___________, 2018
Heidi Harmon
Mayor, City of San Luis Obispo
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071928\9447955
DE VELOPMENT AGREEMENT
BY AND BETWEEN
THE CITY OF SAN LUIS OBISPO
AND
MI SAN LUIS RANCH, LLC
RELATING TO
THE SAN LUIS RANCH
(The “SAN LUIS RANCH DEVELOPMENT AGREEMENT”)
As Adopted by the San Luis Obispo City Council
on __________ by Ordinance No. -________
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071928\9447955 i
TABLE OF CONTENTS
RE CITALS AND DEFINITIONS ............................................................................................ 1
AGREEMENT ............................................................................................................................. 4
ARTICLE 1. GENERALLY .......................................................................................................... 4
Section 1.01. Developer. ........................................................................................................ 4
Section 1.02. Effective ........................................................................................................... 4
ARTICLE 2. DESCRIPTION OF THE PROJECT ....................................................................... 6
Section 2.01. In General......................................................................................................... 6
Section 2.02. Project Approvals. ............................................................................................ 6
Section 2.03. Subsequent Approvals. ..................................................................................... 7
Section 2.04. Subsequent Approval Documents. The Subsequent Approvals ...................... 7
Section 2.05. Processing Subsequent Approvals ................................................................... 7
Section 2.06. Approvals ......................................................................................................... 8
ARTICLE 3. DEVELOPMENT OF PROJECT IN GENERAL ................................................... 8
Section 3.01. Consideration to Developer ............................................................................. 8
Section 3.02. Consideration to City ....................................................................................... 8
Section 3.03. Rights of Developer Generally. ....................................................................... 8
Section 3.04. Rights of City Generally. ................................................................................. 8
Section 3.05. Project Parameters. .......................................................................................... 8
ARTICLE 4. APPLICABLE LAW ............................................................................................... 9
Section 4.01. In General......................................................................................................... 9
Section 4.02. Application of Other City Laws ....................................................................... 9
Section 4.03. Uniform Codes and Standard Specifications ................................................. 11
Section 4.04. State and Federal Law .................................................................................... 11
ARTICLE 5. FINANCIAL COMMITMENTS OF CITY AND DEVELOPER ......................... 12
Section 5.01. In General....................................................................................................... 12
Section 5.02. Establishment of Financing Mechanisms ...................................................... 14
Section 5.03. Imposition of and Increases in Fees, Taxes, Assessments and Other Charges
............................................................................................................................................... 14
Section 5.04. Other Financing Commitments ...................................................................... 18
ARTICLE 6. COMMITMENTS RELATED TO PUBLIC IMPROVEMENTS ........................ 23
Section 6.01. Backbone Infrastructure Improvement Plan ................................................... 23
Section 6.02. Construction and Dedication of Project Facilities and Infrastructure ............ 24
Section 6.03. Cooperation as to Project Facilities and Infrastructure .................................. 25
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071928\9447955 ii
ARTICLE 7. OTHER COMMITMENTS OF CITY AND DEVELOPER ................................. 28
Section 7.01. Mutual Cooperation for Other Governmental Permits .................................. 28
Section 7.02. Timing of Development ................................................................................. 28
Section 7.03. Dedication of Park Lands............................................................................... 29
Section 7.04. Dedication of Open Space/Agricultural Lands .............................................. 29
Section 7.05. Affordable Housing ........................................................................................ 30
Section 7.06. Energy ............................................................................................................ 30
Section 7.07. Water .............................................................................................................. 31
Section 7.08. Wastewater ..................................................................................................... 31
Section 7.09. Recycled Water Facilities ............................................................................... 31
Section 7.10. Storm Drain Facilities .................................................................................... 32
Section 7.11. Floodplain Management ................................................................................ 32
Section 7.12. Traffic and Circulation Improvements ........................................................... 32
Section 7.13. Miscellaneous ................................................................................................ 32
ARTICLE 8. CONSIDERATION OF PERMITS AND APPROVALS ..................................... 33
Section 8.01. Review and Action Generally ........................................................................ 33
Section 8.02. Applicable Law .............................................................................................. 33
Section 8.03. General Plan and San Luis Ranch Specific Plan Amendments ..................... 34
Section 8.04. MMRP Application ........................................................................................ 34
Section 8.05. Life of Approvals ........................................................................................... 34
Section 8.06. Vesting Maps ................................................................................................. 34
ARTICLE 9. AMENDMENTS ................................................................................................... 34
Section 9.01. In General....................................................................................................... 34
Section 9.02. Future Approvals Do Not Require Amendments to Agreement .................... 35
Section 9.03. Operating Memoranda ................................................................................... 35
Section 9.04. Administrative Amendments ......................................................................... 35
ARTICLE 10. ANNUAL REVIEW ............................................................................................ 35
Section 10.01. In General..................................................................................................... 35
Section 10.02. Other Investigations and Evaluations .......................................................... 36
ARTICLE 11. MMRP EVALUATION AND DEVELOPMENT AGREEMENT REVIEW .... 36
Section 11.01. MMRP Evaluation ....................................................................................... 36
Section 11.02. MMRP Implementation ............................................................................... 36
Section 11.03. Enforcement ................................................................................................. 36
Section 11.04. Development Agreement Review ................................................................ 36
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071928\9447955 iii
Section 11.05. Director’s Findings of Compliance .............................................................. 36
Section 11.06. Finding of Development Agreement Noncompliance ................................. 36
ARTICLE 12. DEFAULT, REMEDIES, TERMINATION OF DEVELOPMENT
AGREEMENT .............................................................................................................................. 37
Section 12.01. Notice and Cure ........................................................................................... 37
Section 12.02. Actions during Cure Period .......................................................................... 37
Section 12.03. Remedies of Non-Defaulting Party .............................................................. 37
Section 12.04. Administrative Remedies ............................................................................. 38
Section 12.05. Judicial Remedies ........................................................................................ 38
Section 12.06. Termination Due to Default ......................................................................... 38
Section 12.07. Judicial Reference ........................................................................................ 39
ARTICLE 13. ASSIGNMENT, TRANSFER AND NOTICE .................................................... 40
Section 13.01. Assignment of Interests, Rights and Obligations ......................................... 40
Section 13.02. Transfers In General ..................................................................................... 40
Section 13.03. Non-Assuming Transferees .......................................................................... 41
ARTICLE 14. MORTGAGEE PROTECTION ........................................................................... 42
Section 14.01. In General..................................................................................................... 42
Section 14.02. Impairment of Mortgage or Deed of Trust ................................................... 42
Section 14.03. Notice of Default to Mortgagee ................................................................... 42
Section 14.04. Right of Mortgagee to Cure ......................................................................... 42
Section 14.05. Mortgagee Liability for Past Defaults or Obligations .................................. 42
Section 14.06. Technical Amendments to this Article 14 ................................................... 43
ARTICLE 15. GENERAL PROVISIONS .................................................................................. 43
Section 15.01. Incorporation of Recitals.............................................................................. 43
Section 15.02. Project is a Private Undertaking .................................................................. 43
Section 15.03. Cooperation in the Event of Legal Challenge .............................................. 43
Section 15.04. Defense and Indemnity ................................................................................ 44
Section 15.05. Governing Law; Attorneys’ Fees ................................................................. 44
Section 15.06. Force Majeure .............................................................................................. 44
Section 15.07. Waiver .......................................................................................................... 45
Section 15.08. Notices ......................................................................................................... 45
Section 15.09. No Joint Venture or Partnership ................................................................... 46
Section 15.10. Severability .................................................................................................. 46
Section 15.11. Estoppel Certificate ...................................................................................... 47
Section 15.12. Further Assurances ....................................................................................... 47
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Section 15.13. Construction ................................................................................................. 47
Section 15.14. Other Miscellaneous Terms ......................................................................... 47
Section 15.15. Counterpart Execution ................................................................................. 48
Section 15.16. Time ............................................................................................................. 48
Section 15.17. Good Faith/Fair Dealing .............................................................................. 48
Section 15.18. List of Exhibits ............................................................................................. 48
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DEVELOPMENT AGREEMENT
BY AND BETWEEN THE CITY OF SAN LUIS OBISPO AND
MI SAN LUIS RANCH, LLC RELATING TO
THE SAN LUIS RANCH
THIS DEVELOPMENT AGREEMENT is entered into this ___ day of ________, 2018
(“Execution Date”), by and between the CITY OF SAN LUIS OBISPO, a municipal
corporation and charter city (“City”), and MI SAN LUIS RANCH, LLC, a Delaware limited
liability company (“Developer”), hereinafter referred to in this Development Agreement
individually as a “Party” and collectively as the “Parties.”
RECITALS AND DEFINITIONS
A. The “Project,” as referenced in this Development Agreement, consists of the
development of housing, neighborhood commercial, commercial retail, park, and agricultural and
open space uses located within the San Luis Ranch Specific Plan area on the southwestern
boundary of the City, as further described in Section 2.01 below. The “Property,” as referenced
in this Development Agreement, consists of approximately 131 acres of land designated for
development under the San Luis Ranch Specific Plan (“SLR SP”). The Property is depicted on
Exhibit A and legally described on Exhibit B, both attached hereto and incorporated herein by
this reference.
B. Developer represents and warrants to City that as of the Execution Date,
Developer owns or otherwise has legal interest in the Property.
C. The Property has an entitled development project that was the subject of the
Dalidio Ranch Initiative Measure (“Measure J”) that was submitted to, and approved by, the
voters of San Luis Obispo County on November 7, 2006. Among other uses, Measure J
authorizes Developer to proceed with development on the Property of 530,000 square feet of
commercial/retail, 198,000 square feet of business/office, and 60 residential units.
D. On December 9, 2014, City adopted an update to the Land Use and Circulation
Elements (“LUCE”) of the City’s General Plan that included the area subject to the SLR SP (the
“SLR SP Area”). The City’s General Plan designates the SLR SP Area for a variety of land
uses to benefit the City and its residents including residential, neighborhood commercial, open
space, and agricultural, and the City has found that this Development Agreement is consistent
with the applicable provisions of the General Plan and the SLR SP.
E. City and Developer have engaged in a cooperative and successful relationship to
establish a specific plan for the future of the SLR SP Area. These efforts culminated in the
City’s adoption and approval of the following entitlements:
(1) The Final Environmental Impact Report and associated Mitigation Monitoring
and Reporting Plan (including all mitigation measures therein) for the Project
certified and adopted, respectively, by Resolution No. 10822, on July 18, 2017,
and the Supplemental Final Environmental Impact Report for the Project certified
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and adopted by Resolution No. _________, on _____, 2018, as further identified
in Recital F, below.
(2) An amendment to the General Plan (Resolution No. 10822), adopted on July 18,
2017, including amendments to the LUCE (“LUCE Update”) adopted by
Resolution No. 10586 (2014 Series) on December 9, 2014.
(3) The SLR SP adopted by Resolution No. 10822, on July 18, 2017, as amended by
Resolution No. ____, adopted on _____, 2018.
(4) The City’s Zoning Ordinance as amended by Ordinance No. ___, adopted _____,
201_.
(5) The Development Plan approved by Resolution No. 10822, on July 18, 2017.
(6) The Vesting Tentative Map #3096 approved on July 18, 2017.
(7) The Annexation Agreement approved by Resolution No. ___, adopted on _____,
2018.
(8) Ordinance No. ____ dated _____, 2018 adopting this Development Agreement
(the “Adopting Ordinance”).
(9) The conditions of approval of each of the foregoing.
(10) The resolution of Application to the San Luis Obispo County Local Area
Formation Commission (“LAFCO”) initiating the annexation of the Property into
the City.
These approvals are collectively referred to herein as the Project Approvals (as further
defined in Section 2.02).
F. Before approving the Project Approvals, the City Council of the City of San Luis
Obispo: (i) reviewed and considered the significant environmental impacts of the Project and
several alternatives to the Project, as described in that certain Final Environmental Impact Report
(the “Project EIR”) and (ii) adopted Resolution No. 10822 on July 18, 2017 to certify the
Project EIR, making Findings Concerning Mitigation Measures and Alternatives (the
“Findings”), adopting a Statement of Overriding Considerations, and adopting a Mitigation
Monitoring and Reporting Plan (the “MMRP”), all in accordance with the provisions of the
California Environmental Quality Act, California Public Resources Code section 21000 et seq.
(“CEQA”). Subsequently, the City Council of the City of San Luis Obispo reviewed and
considered the significant impacts of certain changes to the Project in that certain Supplemental
Final Environmental Impact Report (the “SEIR”) and adopted Resolution No. ______ on
_______, 2018 to certify the SEIR in accordance with CEQA.
G. A principal purpose of this Development Agreement is to further the cooperative
relationship between City and Developer for the benefit of the City and the residents of the City
during the implementation of the SLR SP. The City and Developer join as Parties to this
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Development Agreement to ensure the requirements of the Development Agreement statute
(California Government Code section 65864 et. seq.) and the City’s Development Agreement
ordinance, chapter 17.94 of its Zoning Ordinance, are satisfied. As more fully set forth below,
this Development Agreement contains covenants and/or servitudes that run with the title to the
Property.
H. In conjunction with the negotiation of this Development Agreement, the Parties
have developed a Financial Plan, a copy of which is attached hereto as Exhibit C, and which the
City’s economic consultant used as a basis to develop a Financial Feasibility Memorandum, a
copy of which is attached hereto as Exhibit D.
I. The Parties intend this Development Agreement to achieve the following
purposes:
(1) that the City shall be kept and/or made “whole” by Developer as to the Property
and by other property owners, in regard to their respective properties, with respect
to all aspects, including without limitation, fiscal impacts, of the planning,
development, maintenance and operation of the SLR SP Area including the costs
to the City of providing public services and facilities to the Project, the payment
of City’s costs associated with the implementation of this Development
Agreement, the Project Approvals, all other planning and environmental efforts
described and envisioned by this Development Agreement, the Subsequent
Approvals (as defined in Section 2.03 below), and the mitigation of the Project’s
environmental impacts;
(2) that once this Development Agreement has taken legal effect, Developer shall
have a full and vested right, throughout the term of this Development Agreement,
to the Rights and Obligations as to the Property;
(3) to reduce the uncertainty in planning and implementation of the Project and to
secure the orderly development thereof, ensure a desirable and functional
community environment, provide effective and efficient development of public
facilities, infrastructure and services appropriate for the development of the
Project, ensure maximum effective utilization of resources within the City, and
provide other significant benefits to the City and its residents;
(4) to secure Project features and development conditions above and beyond those
that may be levied by the City under existing zoning and development regulations
and the Project EIR;
(5) to provide Developer with a reliable and definitive form of reimbursement or fee
credits for offsite and onsite infrastructure beyond its fair share;
(6) to be consistent with and to implement the City’s General Plan, the SLR SP and,
more particularly, to achieve the community’s development objectives for the
Property as set forth in Policy 8.1.4 of the Land Use Element;
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(7)to enable the City to potentially capture sales taxes that are being leaked to other
communities because of the jobs-housing imbalance; and
(8) to provide 580 residences that would help capture a substantial amount of
commuters currently heading to jobs in the City.
The Rights and Obligations of the Parties to this Development Agreement shall be construed and
interpreted so as to give full effect to each and all of these purposes.
J. As used in this Development Agreement, “Rights” shall mean all of the vested
and other rights and benefits of this Development Agreement, and the term “Obligations” shall
mean all of the duties, obligations, responsibilities and other burdens of this Development
Agreement. References to lot numbers in this Development Agreement refer to lots as numbered
in Vesting Tentative Tract Map. No. 3096 dated July 18, 2017.
K. As used in this Development Agreement, the terms, phrases and words shall have
the meanings and be interpreted as set forth in this Development Agreement (the meaning given
the term in the singular shall include the term in the plural and vice versa) unless the context
clearly indicates the Parties intended another meaning. To the extent any capitalized terms
contained in this Development Agreement are not defined within it, then such terms shall have
the meaning ascribed to them in Applicable Law or, if no meaning is given a term in such
sources, the most common understanding of the term, in light of the terms and conditions of this
Development Agreement, shall control.
AGREEMENT
NOW, THEREFORE, in consideration of the promises, covenants and provisions set
forth in this Development Agreement, the Parties hereby agree as follows:
ARTICLE 1. GENERALLY
Section 1.01. Developer. As used herein, “Developer” means MI San Luis Ranch, LLC,
as that business entity existed on the Effective Date and any permitted successor, assign, or
transferee of MI San Luis Ranch, LLC.
Section 1.02. Effective, Vesting and Annexation Dates. This Development Agreement is
entered into by and between the City and Developer and takes legal effect on the date that it is
signed by the later of them to do so (the “Effective Date”), although the rights and obligations of
this Agreement with respect to the development of the Site are not effective until the later of
(i) ______, 2018, the date that Ordinance No.__-___ approving this Development Agreement
takes legal effect (the “Vesting Date”), or (ii) the date upon which the Property is annexed into
the City (the “Annexation Date”). The terms and conditions of this Development Agreement
shall be for the benefit of or a burden upon the Property, shall run with title to the Property, and
shall be binding upon Developer and its successors, assigns and transferees during their
respective ownerships of any portion of the Property from and after the later of those two dates.
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Section 1.03. Term.
Section 1.03.1. In General.
(a) Although this Agreement shall legally bind the Parties upon the Effective Date,
the term of this Development Agreement shall commence upon the Annexation Date defined in
section 1.02 above and shall continue until, and terminate upon, the earliest of the following
dates (“Termination Date”):
(1) 12:01 a.m. on the 20th anniversary of the Annexation Date (the “Initial
Termination Date”), unless Developer requests, and the City approves, an
extension of the Term for an additional 10-year period, in which case the
Termination Date shall be 12:01 on the 30th anniversary of the Annexation Date.
Such request for an extension shall be submitted, in writing, to the City Manager
at least 60 days, but no earlier than 180 days, before the Initial Termination Date.
The City may deny the request for an extension if Developer is not in substantial
compliance with all of its Obligations under this Development Agreement. Any
disputes regarding or relating to any extensions under this Section shall be
resolved in accordance with Article 12 hereof;
(2) 12:01 a.m. on the 15th anniversary of the Annexation Date, should Developer fail
to complete the Backbone Infrastructure for the Project (except for any fair share
payments related to the Prado Overpass and related ramps, including the payment
of the Prado Road Interchange Mitigation Fee (defined and governed by Sections
5.04.5 and 5.04.6, below)) in accordance with the SLR SP, SEIR and Section
6.01, below, prior to such date.
(3) This Development Agreement may be terminated with respect to property
included in a recorded final subdivision map creating residential lots on any
portion of the Property, provided that no further on-site or off-site infrastructure is
required and no conditions or mitigation measures remain to be satisfied before
building permits may issue for the development of those lots. Concurrently with
or following recordation of such a subdivision map as to any portion of the
Property, Developer may request in writing, and the Community Development
Director shall be authorized to execute and shall not unreasonably withhold, a
certificate of termination of this Agreement in recordable form solely as to the
property included in such a final recorded map; provided that no such certificate
need issue if Obligations to the City under this Development Agreement remain
unfulfilled which are not made conditions of approval of the subdivision map.
Upon the Community Development Director’s recordation of such a certificate,
this Development Agreement shall terminate as to the land covered by such final
map. If Developer does not request or the Community Development Director does
not issue such a certificate, this Development Agreement shall continue to apply
to any lot depicted on such a subdivision map until this Development Agreement
otherwise expires or terminates according to its terms. Notwithstanding the
foregoing, this Development Agreement shall automatically terminate with
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respect to any lot intended for residential development upon final sign-off of the
building permit for a residential structure on such lot.
(4) Notwithstanding the foregoing, this Development Agreement shall terminate in
accordance with Government Code Section 65865(b) if the annexation is not
completed within five years of the Vesting Date defined by section 1.02 above,
unless such date is extended by mutual agreement of the Parties.
(b) This Development Agreement shall be of no further force, effect or operation
upon the Termination Date. Subject to the provisions of Section 8.05 below, in no event shall the
expiration or termination of this Development Agreement result in expiration or termination of
any Approval without further action of City.
Section 1.04. Execution and Recordation of Agreement.
Section 1.04.1. Execution and Recordation. Developer shall execute this
Development Agreement in conformance with Section 15.17 below within five business days
following the adoption of the Adopting Ordinance referenced in Recital E above. Provided
Developer has so executed this Agreement, City shall execute this Agreement, in conformance
with Section 15.15 of this Agreement, within five business days of Developer’s execution of this
Development Agreement.
Section 1.04.2. Recordation. City shall deliver this Agreement to the County
Recorder for recordation within 10 days following its execution.
ARTICLE 2. DESCRIPTION OF THE PROJECT
Section 2.01. In General. As used herein, “Project” means the development of the
Property as described in the Project Approvals (defined in Section 2.02 below), including all
on-site and off-site “Project Facilities and Infrastructure” (defined in Section 5.01.1 below).
Section 2.02. Project Approvals. As used herein, “Project Approvals” include, but are
not limited to:
(i) those provisions of City’s General Plan that relate to or affect the Property, as the
General Plan existed on the Vesting Date and as it may be amended from time to
time consistently with this Development Agreement (the “General Plan”);
(ii) those provisions of the SLR SP (including the Design Guidelines) that relate to or
affect the Property, as the SLR SP existed on the Vesting Date and as it may be
amended from time to time consistently with this Development Agreement;
(iii) the zoning of the Property, as it existed on the Vesting Date and as it may be
amended from time to time consistently with this Development Agreement
thereafter (the “Zoning”); and
(iv) the other entitlements listed in Recital E above;
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provided, however, that “Project Approvals” shall not mean or include amendments to the
General Plan, SLR SP or Zoning of the Property that conflict with the Project Approvals as they
existed on the Vesting Date, unless Developer consents in writing to such conflicting
amendments.
Section 2.03. Subsequent Approvals. As used herein, “Subsequent Approvals” are
those permits and approvals (other than the Project Approvals and amendments thereto)
necessary or desirable for the development of the Project including, without limitation, those
identified in Section 2.04 below.
Section 2.04. Subsequent Approval Documents. The Subsequent Approvals defined in
Section 2.03 above include, but are not limited to:
(i) subdivision maps (including phased final maps) and related or similar approvals
issued under the California Subdivision Map Act;
(ii) development permits (including Site Plan Reviews and Conditional Use Permits
as described in the SLR SP);
(iii) architectural review and design review approvals (as described in the SLR SP);
(iv) any other discretionary or ministerial permits or approvals of City necessary or
appropriate for build-out of the Project and Property; and
(v) any amendments to any of the foregoing necessary or appropriate for the
development of the Project.
Section 2.05. Processing Subsequent Approvals.
Section 2.05.01. Processing of Subsequent Approvals. City will accept, make
completeness determinations, and process, promptly and diligently to completion, all
applications for Subsequent Approvals for the Project in accordance with the terms of this
Development Agreement and Applicable Law.
Section 2.05.02. Scope of Review of Subsequent Approvals. By approving the
Project Approvals, City has made a final policy decision that the Project is in the best interests of
the public health, safety and general welfare. Accordingly, City shall not use its authority in
considering any application for a discretionary Subsequent Approval to change the policy
decisions reflected by the Project Approvals or otherwise to prevent or delay development of the
Project as set forth in the Project Approvals. Instead, the Subsequent Approvals shall be deemed
to be tools to implement those final policy decisions. The scope of the review of applications for
Subsequent Approvals shall be limited to a review of substantial conformity with the Applicable
Law and Rights vested hereunder (the “Vested Elements”) (except as otherwise provided by
Sections 4.02 through 4.04), and compliance with CEQA and other Applicable Law. Where
such conformity/compliance exists, City shall not deny an application for a Subsequent Approval
for the Project.
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Section 2.05.03. Conditions of Subsequent Approvals. City shall have the right
to impose reasonable conditions upon Subsequent Approvals including, without limitation,
normal and customary dedications for rights of way or easements for public access, utilities,
water, sewers, and drainage necessary for the Project; provided, however, such conditions and
dedications shall not be inconsistent with the Applicable Law or Project Approvals, nor
inconsistent with the development of the Project as contemplated by this Agreement except to
the extent required by Applicable Law. Developer may protest any conditions, dedications or
fees while continuing to develop the Property. Such a protest by Developer shall not delay or
stop the issuance of building permits or certificates of occupancy for any aspect of the Project
not related to the condition protested. No conditions imposed on Subsequent Approvals shall
require dedications or reservations for, or construction or funding of, public infrastructure or
public improvements beyond those already included in the SLR SP and the MMRP except to the
extent required by CEQA.
Section 2.06. Approvals. Project Approvals, amendments to Project Approvals, and
Subsequent Approvals are sometimes referred to in this Development Agreement collectively as
the “Approvals” and each individually as an “Approval.”
ARTICLE 3. DEVELOPMENT OF PROJECT IN GENERAL
Section 3.01. Consideration to Developer. The Parties acknowledge and agree that
City’s agreement to perform and abide by the Rights and Obligations of City set forth herein is
material consideration for Developer’s agreement to perform and abide by the Rights and
Obligations of Developer set forth herein.
Section 3.02. Consideration to City. The Parties acknowledge and agree that
Developer’s agreement to perform and abide by the Rights and Obligations of Developer set
forth herein is material consideration for City’s agreement to perform and abide by the Rights
and Obligations of City set forth herein.
Section 3.03. Rights of Developer Generally. Developer shall have a fully vested right
to develop the Project and to use the Property consistently with this Development Agreement and
Applicable Law.
Section 3.04. Rights of City Generally. City shall have a right to regulate development
of the Project and use of the Property consistently with this Development Agreement and
Applicable Law.
Section 3.05. Project Parameters. The permitted uses of the Property, the density and
intensity of use of the Property, the maximum height and size of buildings included in the
Project, and provisions for the reservation and dedication of land shall be as set forth herein and
in the Project Approvals.
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ARTICLE 4. APPLICABLE LAW
Section 4.01. In General.
Section 4.01.1. Applicable Law Defined. Except as the Parties may otherwise
agree in writing, the rules, regulations and official policies applicable to the Project and the
Property during the Term of this Development Agreement shall be those set forth in this
Development Agreement and, except as otherwise set forth herein, the rules, regulations and
official policies of City (including the plans, municipal codes, ordinances, resolutions and other
local laws, regulations, capital facilities fees and policies of City) in force and effect on the
Vesting Date as well as state and federal law applicable to the Project (collectively, “Applicable
Law”).
Section 4.01.2. Approvals as Applicable Law. Applicable Law shall include,
without limitation, Approvals as they may be issued from time to time consistently with this
Agreement.
Section 4.02. Application of Other City Laws.
Section 4.02.1. No Conflicting City Laws.
(a) City may apply to the Project and the Property any rule, regulation or official
policy of City (including any plan, municipal code, ordinance, resolution or other
local law, regulation, capital facility fee or policy of City) (each a “City Law”)
that does not conflict with Applicable Law or this Agreement. City shall not,
however, without the written consent of Developer apply to the Project or the
Property (whether by initiative, referendum, imposition of mitigation measures
under CEQA or otherwise) any City Law that is in conflict with Applicable Law
or this Agreement.
(b) Any changes by the City to the General Plan or any Specific Plan, Zoning
Ordinance, or other rules, regulations, ordinances, or policies of the City (whether
adopted by ordinance, initiative, referendum, resolution, policy, order, or other
means) (collectively “Future Rules”) that are not in conflict with the Vested
Elements shall apply to the Project. For purposes of this Section, “in conflict”
means Future Rules would (i) alter the Vested Elements, or (ii) significantly
frustrate the intent or purpose of the Vested Elements, or (iii) materially increase
(e.g., by an amount more than 10%) the cost of performance of, or preclude
compliance with, any provision of the Vested Elements, or (iv) significantly delay
development of the Project, or (v) limit or restrict the availability of public
utilities, services, infrastructure or facilities (for example, without limitation,
water rights, water connection or sewage capacity rights, sewer connections, etc.)
to the Project, or (vi) impose limits or controls in the rate, timing, phasing or
sequencing of development of the Project beyond those existing on the Vesting
Date, or (vii) increase or adopt new impact fees levied against the Project, except
as provided in this Development Agreement, or (viii) limit or control the location
of buildings, structures, grading, or other improvements of the Project
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inconsistently with or more restrictive than the Project Approvals; or (ix) apply to
the Project any Future Rule otherwise allowed by this Agreement that is not
uniformly applicable to all substantially similar development projects and project
sites in the City; (x) require the issuance of additional permits or approvals by the
City other than those required by Applicable Law; or (xi) establish, enact,
increase, or impose against the Project or Property any fees, assessments, or other
monetary obligations other than those specifically permitted by this Agreement;
(xii) impose against the Project any condition, dedication or other exaction not
specifically authorized by Applicable Law; or (xiii) limit the processing or
procuring of applications and approvals of Subsequent Approvals. To the extent
that Future Rules conflict with the Vested Elements, the Future Rules shall not
apply to the Project, except as provided in this Section.
To the maximum extent permitted by law, City shall prevent any Future Rules
from invalidating or prevailing over all or any part of this Agreement, and City
shall cooperate with Developer and shall undertake such actions as may be
necessary to ensure this Agreement remains in full force and effect. City shall not
support, adopt or enact any Future Rule, or take any other action which would
violate the express provisions or spirit and intent of this Agreement or the Project
Approvals. Developer reserves the right to challenge in court any Future Rule
that would conflict with the Vested Elements or this Agreement or reduce the
development rights provided by this Agreement.
A Future Rule that conflicts with the Vested Elements shall nonetheless apply to
the Property if, and only if: (i) consented to in writing by Developer; (ii) it is
determined by City and evidenced through findings adopted by the City Council
that the change or provision is reasonably required to prevent a condition
dangerous to the public health or safety; (iii) it is required by changes in State or
Federal law as set forth in Section 4.04 below; (iv) it consists of revisions to, or
new Uniform Codes permitted by Section 4.03; or (v) it is otherwise permitted by
this Development Agreement.
Prior to the Vesting Date, the Parties shall have prepared two sets of the Project
Approvals and Applicable Law (exclusive of state and federal law), one for City
and one for Developer. If it becomes necessary in the future to refer to any of the
Project Approvals or Applicable Law, the contents of these sets are presumed for
all purposes of this Development Agreement, absent clear clerical error or similar
mistake, to constitute the Project Approvals and Applicable Law.
(c) No City-imposed moratorium or other limitation (whether relating to the rate,
timing, or sequencing of the development or construction of all or any part of the
Project, whether imposed by ordinance, initiative, resolution, policy, order, or
otherwise, and whether enacted by the City Council, an agency of City, the
electorate, or otherwise) affecting parcel or subdivision maps (whether tentative,
vesting tentative, or final), building permits, occupancy certificates or other
entitlements to use or service (including, without limitation, water and sewer)
approved, issued, or granted within City, or portions of City, following the
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approval of the SLR SP, shall apply to the Project to the extent such moratorium
or other limitation is in conflict with this Development Agreement; provided,
however, the provisions of this subsection shall not affect City’s compliance with
moratoria or other limitations mandated by other governmental agencies or court-
imposed moratoria or other limitations, including without limitation City action to
impose a moratorium on water or sewer service connections required by
Applicable Law.
(d) If City attempts to apply to the Project a City Law which Developer believes to
conflict with Applicable Law or this Agreement, Developer shall give City
written notice describing the legal and factual basis for Developer’s position. The
Parties shall meet and confer within 30 days of City’s receipt of that notice to
seek to resolve any disagreement. If no mutually acceptable solution can be
reached, either Party may take such action as may be permitted under Article 12
below.
Section 4.03. Uniform Codes and Standard Specifications.
(a) Nothing herein shall prevent City from applying to the Project standards
contained in uniform building, construction, fire or other uniform codes, as the
same may be adopted or amended from time to time by City, provided:
(1) That the provisions of any such uniform code shall apply to the Project
only to the extent that such code is in effect on a City-wide basis; and
(2) With respect to those portions of any such uniform code that have been
adopted by City without amendment, that the provisions of any such
uniform code shall be interpreted and applied consistently with the
generally prevailing interpretation and application of such code in
California.
(b) Notwithstanding anything to the contrary contained herein, public improvements
shall be constructed in accordance with the public works standard specifications
in effect at the time that such improvements are constructed.
Section 4.04. State and Federal Law.
(a) Nothing herein shall prevent City from applying to the Project or the Property any
change in City Law required by: (a) state or federal law; or (b) any governmental
agency that, due to the operation of state law (and not the act of City through a
memorandum of understanding, joint exercise of powers or other agreement
entered into after the Vesting Date), has binding legal authority over City.
(b) If the application of such changes prevents or precludes performance of one or
more provisions of this Agreement, City and Developer shall take any and all
such actions as may be necessary or appropriate to ensure the provisions of this
Development Agreement are implemented to the maximum extent practicable.
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Section 4.05. Expansion of Development Rights. If any Future Rule or State or Federal
law expands, extends, enlarges or broadens Developer’s rights to develop the Project, then, (a) if
such law is mandatory, the provisions of this Development Agreement shall be modified as may
be necessary to comply or conform with such new law, and (b) if such law is permissive, the
provisions of this Development Agreement shall be modified, upon the mutual agreement of
Developer and City, as may be necessary to comply or conform with such new law. Immediately
after enactment of any such new law, upon Developer’s request, the Parties shall meet and confer
in good faith for a period not exceeding 60 days (unless such period is extended by mutual
written consent of the Parties) to prepare such modification. Developer shall have the right to
challenge City’s refusal to apply any new law mandating expansion of Developer’s rights under
this Development Agreement pursuant to Article 12 of this Development Agreement, and if such
challenge is successful, this Development Agreement shall be modified to comply with, or
conform to, the new law.
ARTICLE 5. FINANCIAL COMMITMENTS OF CITY AND DEVELOPER
Section 5.01. In General. This Article 5 establishes a framework for the imposition and
allocation to the extent permitted by law of fees, assessments and other revenues to be generated
and/or paid by the Project and/or the Property. The provisions of this Article 5 are intended to
prevent the Project from resulting in negative fiscal impacts on City; to facilitate the
construction, operation and maintenance of infrastructure and facilities to avoid or limit the
physical impacts of development; and to assist in the development of the Project so as to provide
long-term fiscal and other benefits to City, including increased employment opportunities, an
increased City tax base, and an enhanced quality of life for the City’s residents. In consideration
of, and in reliance upon City agreeing to this Development Agreement, Developer will provide
the community benefits (“Community Benefits”) described in Exhibit C attached hereto, which
are over and above those dedications, conditions and exactions required by Applicable Law other
than this Agreement.
Section 5.01.1. Basic Principles.
(a) This Article 5 is intended to implement the following conceptual framework: that
the City shall not incur costs for construction of new public facilities and
infrastructure needed to serve the Project or the Property or for the provision of
municipal services to the Project or the Property including the operation and
maintenance of facilities and infrastructure to serve the Project (collectively, the
“Project Facilities and Infrastructure”), except to the extent necessary to
address existing infrastructure deficits. Any costs of any Project Facilities and
Infrastructure beyond the Project’s fair share of such Project Facilities and
Infrastructure shall be borne by other property owners and/or developers served
by such Project Facilities and Infrastructure or the City if needed to address an
existing operational deficit to be addressed by such Project Facilities and
Infrastructure. Nothing herein shall either require or prevent the City from
contributing to the cost to develop such Project Facilities and Infrastructure from
any lawfully available funds, in the City’s sole discretion.
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(b) The cost of providing Project Facilities and Infrastructure shall be consistent with
the following principles, except as otherwise specifically permitted by this
Development Agreement:
(i) there shall be a reasonable relationship between any municipal cost
required to be borne by the Project and the type of development within the
Project to which such cost is attributable;
(ii) there shall be a reasonable relationship between the need to incur any such
municipal cost and the type of development within the Project to which
such cost is attributable;
(iii) no municipal cost required to be borne by the Project shall exceed the
estimated reasonable cost of providing the service or facility to which such
municipal cost relates; and
(iv) with respect to any fee required to finance Project Facilities and
Infrastructure, there shall be a reasonable relationship between the amount
of the fee and the cost of the Project Facilities and Infrastructure funded
by such fee.
(c) Whenever this Development Agreement requires a “reasonable relationship”
between the Project and any requirement imposed thereon, there shall be required
an essential nexus between the Project and such requirement and rough
proportionality in the allocation of a municipal cost or fee both internally to
various portions of the Property and as between the Project and other projects
within the City.
(d) As used herein, the term “Project Facilities and Infrastructure” shall include
public facilities and infrastructure only to the extent they serve the Project or the
Property, and shall not include public facilities or infrastructure to the extent such
facilities or infrastructure serve projects or areas other than the Project or the
Property, unless the public facilities and infrastructure serving the Project or
Property are required to be oversized to serve other projects or areas in
accordance with the provisions of Section 6.02.2 below.
Section 5.01.2. Financing of Infrastructure; Operation and Maintenance. City
shall exhaust all reasonable efforts and diligently pursue and utilize all mechanisms which may
be appropriate to finance Project Facilities and Infrastructure and Project-related municipal
services or the operation and maintenance of the Project Facilities and Infrastructure, such as
Mello-Roos Districts, Enhanced Infrastructure Financing Districts, Landscaping and Lighting
Districts, and other Maintenance Assessment Districts, in accordance with the following
principles:
(a) The level of municipal services provided to the Project, including the level of
operation and maintenance of Project Facilities and Infrastructure, shall be equal
or superior to the level of service provided elsewhere in the City.
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(b) Any costs associated with such mechanism shall be borne by the financing
mechanism or the Project.
(c) The City may require as a condition of approval of a future tentative subdivision
or parcel map a financing mechanism or mechanisms to finance the operation and
maintenance of Project Facilities and Infrastructure to serve the development of
the land depicted on that map.
Section 5.02. Establishment of Financing Mechanisms.
Section 5.02.1. Procedures for Establishment. The establishment of any
mechanism to finance the construction, operation or maintenance of Project Facilities and
Infrastructure (each a “Financing Mechanism”) and the issuance of any debt in connection
therewith (“Project Debt”) shall be initiated upon Developer’s written request to the City’s
Finance Director. Such request shall include the purposes for which the Financing Mechanism is
to be established and/or the Project Debt issued, and the general terms and conditions upon
which the establishment of the Financing Mechanism and/or the issuance of the Public Debt will
be based. City’s consideration of Developer’s request shall be consistent with the principles set
forth in Section 5.01.2 above. If Developer requests the City to form a Mello-Roos Community
Facilities District or an Enhanced Infrastructure Financing District to finance Project Facilities
and Infrastructure, City shall use its best efforts to cause such district to be formed and bonds to
be issued and, in the case of a Mello-Roos Community Facilities District, special taxes to be
levied to the extent permitted by Applicable Law.
Section 5.02.2. Nature of City Participation. City’s participation in the formation
of any Financing Mechanism, its operation thereafter, and in the issuance of any Project Debt,
shall include all of the usual and customary municipal functions associated with such tasks,
including, without limitation, the formation and administration of special districts; the issuance
of Project Debt; the monitoring and collection of fees, taxes, assessments and charges such as
utility charges; the creation and administration of enterprise funds; the enforcement of debt
obligations and other functions or duties authorized or mandated by Applicable Law.
Section 5.03. Imposition of and Increases in Fees, Taxes, Assessments and Other
Charges.
Section 5.03.1. Taxes and Assessments.
(a) During the Term of this Development Agreement, Developer shall be bound to
and shall not protest, challenge or cause to be protested or challenged, any City
tax in effect on the Vesting Date.
(b) City may apply to the Project or the Property any assessment or fee not in effect
on the Vesting Date only if such assessment or fee is:
(1) An assessment or fee levied in connection with the establishment or
implementation of a Financing Mechanism in accordance with Sections
5.01 and/or 5.02 above; or
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(2) An assessment or fee to which Developer agrees.
(c) No assessment shall be imposed on the Project or the Property other than through
a Financing Mechanism as set forth above unless lawfully applied on a City-wide
basis.
(d) No new debt shall be issued that affects the Project or the Property without
Developer’s approval, unless the approvals otherwise conform with the
requirements of Articles XIII A, C and D of the California Constitution and any
requisite voter approval is achieved, in which case the City may issue debt even if
Developer votes against the matter.
(e) Following the establishment of the initial Financing Mechanism for the Project,
nothing herein obligates Developer to approve any particular future funding
source (e.g., a CFD) or to assist the City, including financial assistance, in
establishing a new financial mechanism that requires a vote of the public without
Developer’s prior written consent, in Developer’s sole discretion.
Section 5.03.2. Other Fees and Charges; Credits and Reimbursements.
(a) City shall impose against or apply to the Project or the Property only those
financial obligations (other than taxes and assessments) described in this Section
5.03.2. Except as otherwise specifically stated below, any financial obligation
imposed against or applied to the Project under this Section 5.03.2 shall be
consistent with the provisions of controlling California law, including California
Constitution article XIII A and Government Code sections 66000 to 66025.
(b) Developer has obtained vested rights pursuant to the VTTM as to the rate of all
City-wide and Project-specific development impact fees (“DIF” or “DIFs”) in
effect as of the date that the VTTM was deemed complete. Developer shall pay
all such DIF fees in effect as of the date that the VTTM was deemed complete
(the “Vested DIF”). On April 17, 2018, the City adopted a comprehensive update
of the City’s DIF program (the “2018 DIF Update”), which is not applicable to
the Project in light of the Project’s existing vested rights under the VTTM.
Notwithstanding the application of such vested rights, Developer has agreed to
voluntarily pay additional DIFs as set forth in this Section 5.03.2(b). All DIFs
shall be calculated at the time of issuance of a building permit for the applicable
structure and be due and payable at the time of the issuance of the certificate of
occupancy of the applicable structure or, if no certificate of occupancy is issued,
upon the final sign-off of the building permit.
(1) DIFs for Residential Units.
(i) DIFs related to Transportation, Water and Waste Water1 shall
remain at the amount of the Vested DIF until the earlier of: (1) the first
1 City and Developer acknowledges that the 2018 DIF Update currently uses the term “Capacity and
Connection Charges” to refer to DIFs related to Waste Water.
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anniversary of the date of recordation of the first Final Map, subject to the
Parties working in good faith to diligently process the approval and
recordation of the Final Map; or (2) two years after Annexation (the
“Reset Date”). Thereafter, the amount of the initial Vested DIF shall be
increased by ten percent (10%) each of the following years on the
anniversary of the Reset Date until the earlier of the following to occur:
(i) the amount of such adjusted Vested DIFs equal the amount established
under the 2018 DIF Update, as adjusted annually in accordance with the
2018 DIF Update; or (ii) ten (10) years following the Effective Date (the
“Residential DIF Vesting Termination Date”). Thereafter, DIFs shall
be adjusted in accordance with the then applicable City law.
(ii) DIFs related to Fire, Police, and General Government fees, which
do not exist under the Vested DIF but are proposed under the 2018 DIF
Update, will be applied, if adopted, at the rate established in the 2018 DIF
Update and adjusted annually in accordance with the then applicable City
law.
(iii) Developer shall pay all DIFs related to Parklands as provided in
Section 7.03.
(2) DIFs for Non-Residential Development (including without limitation
commercial, retail, hotel, and office).
(i) DIFs related to Transportation, Water and Waste Water shall
remain at the amount of the Vested DIF until the Reset Date. Thereafter,
the amount of the Vested DIFs shall be increased by ten percent (10%)
each of the following years on the anniversary of the Reset Date until the
earlier of the following to occur: (i) the amount of such adjusted Vested
DIFs equal the amount established under the 2018 DIF Update, as adjusted
annually in accordance with the 2018 DIF Update; or (ii) ten (10) years
following the Effective Date (the “Non-Residential DIF Vesting
Termination Date”). Thereafter, DIFs shall be adjusted in accordance
with the then applicable City law.
(ii) DIFs related to Fire, Police, and General Government fees, which
do not currently exist but are proposed under the 2018 DIF Update, shall
not apply for one (1) year following the Reset Date. Thereafter, such DIFs
shall be applicable to any non-residential structure within the Project area
at the rate established in the 2018 DIF Update and adjusted annually in
accordance with the then applicable City law.
(iii) The Developer shall pay any DIFs related to Parklands at the rate
established in the 2018 DIF Update and adjusted annually in accordance
with the then applicable City law.
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(3) Minimum Excess DIF Payment and True-Up. On the tenth anniversary of
the Effective Date (the “True Up Date”), the City shall calculate the
amount of DIFs related to Transportation, Water and Waste Water related
to all permits issued prior to the True Up Date as of the date of when such
DIFs for each permit was calculated:
(1) the amount of such DIFs that would have been paid under the
Vested DIFs (the “Vested DIFs Amount”);
(2) the amount of such DIFs actually paid (the “Actual DIFs
Amount”); and
(3) the amount of such DIFs that would have been paid under the 2018
DIF Update (the “2018 DIFs Amount”).
The difference between the Actual DIFs Amount and the Vested DIFs
Amount shall be referred to as the “Excess DIF Payments”. Developer
has agreed that in no event shall the total amount of Excess DIF Payments
be less than the lower of (i) Two Million Seven Hundred Thousand
Dollars ($2,700,000) or (ii) the 2018 DIFs Amount (the “Minimum
Excess DIF Amount”). In the event that the Excess DIF Payments paid
prior to the True Up Date is less than the Minimum Excess DIF Amount,
the City shall deliver an invoice to Developer in the amount of such
underpayment together with supporting documentation establishing such
amount, and Developer shall remit payment of such amount to City within
thirty (30) days. Any disputes related to such calculations shall be
resolved in accordance with Section 12.07.
(c) Costs of service fees imposed by City, such as planning, engineering, building
permit, and fire plan check fees shall be in accordance with the fees in effect as of
the date the fee is due.
(d) The Developer shall pay all then-current processing fees for any subsequent
planning applications and permits as adopted by the City Council.
(e) City acknowledges that Developer may install infrastructure improvements
beyond its “fair share” obligation. In such event, the City agrees to provide
credits against any fees charged by the City for such improvements beyond the
Project’s “fair share” obligation and to provide reimbursements, funded by
Development Impact Fees paid by other developers, including traffic impact fees,
or funded from other sources, but excluding sewer and water connection fees.
Nothing in this Development Agreement shall preclude City and Developer from
entering into infrastructure-item-specific reimbursement agreements for the
portion of the cost of any dedications, public facilities and/or infrastructure the
City may require the Developer to construct as conditions of the Project
Approvals to the extent that they exceed the Project’s “fair share.”
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(f)Developer shall pay City reasonable staff and consultant time and other
reasonable costs (including reasonable consultant costs) associated with:
(1) the MMRP Evaluation, and the Development Agreement Review,
(2) Developer’s fair share of the establishment of any Financing Mechanism
(to the extent such costs are not recovered from the Financing
Mechanism), including any necessary election costs, and
(3) All other administrative tasks associated with City’s adoption and
implementation of this Development Agreement and the SLR SP.
The parties acknowledge that Developer’s fair share of the establishment of any
Financing Mechanism may be 100% if the Financing Mechanism is limited to
land owned or controlled by the Developer and used to fund public facilities and
infrastructure to the extent necessary to serve development of that land.
(g) City acknowledges that Developer has paid all required fees of the California
Department of Fish and Wildlife (“CDFW”) related to posting of the Notice of
Determination under CEQA for the Project EIR as well as the fee required by the
County Clerk/Recorder. To the extent that any additional fees are due to the
County Clerk/Recorder in the future related to Subsequent Approvals, the City
may require proof of payment of such fees before issuing building permits or
accepting the filing a Final Subdivision Map.
(h) During the term of this Development Agreement, fees and charges other than
those specifically described in subsections (a) through (g) above may be imposed
against or apply to the Project or the Property only as City and Developer agree in
writing.
Section 5.04. Other Financing Commitments.
Section 5.04.1. Arrangements with Other Governmental Agencies. City and
Developer acknowledge and agree that City may from time to time enter into joint exercise of
power agreements, memoranda of understanding, or other agreements with other governmental
agencies consistent with and to further the purposes of this Development Agreement.
Section 5.04.2. Other Funding Sources.
(a) City and Developer agree to pursue actively outside sources of funding for the
construction, operation and maintenance of Project Facilities and Infrastructure
including, in particular, facilities and infrastructure which serve the region. City
shall not unreasonably object to any request from Developer to apply for county,
state or federal funds that may be used to support the development of Project
Facilities and Infrastructure. For purposes of this Section 5.04.2, it is reasonable
for City to object to a request from Developer to apply for county, state or federal
funds for the Project if there are established funding priorities from administering
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agencies (i.e. San Luis Obispo Council of Governments) which are in conflict
with the Project Facilities and Infrastructure.
(b) Any obligation of Developer under this Development Agreement to fund or
otherwise bear the costs of the construction of improvements, the provision of
services or any other item, whether or not the sole obligation of Developer, may
be satisfied through the use of funds provided by, from or through any third party
(including other non-City, governmental) sources.
Section 5.04.3. Reimbursement.
(a) City shall reimburse the costs associated with Developer’s funding or construction
of that portion of any oversized or accelerated improvement or facility that is
attributable to a project or area other than the Project or Property. Costs eligible
for reimbursement shall include hard costs, such as the reasonable direct costs of
construction and materials; and soft costs, such as bond, architecture, engineering,
and professional fees, the reasonableness of which shall be determined by the
City, in its discretion. Such reimbursement shall be based on a fair share
allocation of costs determined by calculating the pro rata share of the capacity in
such oversized or accelerated improvements that is attributable to other projects
or properties based on the percentages set forth in the Financing Plan in
Exhibit C. On- and off-site, over-sized improvements are depicted in Exhibit C;
provided, however, that the City and Developer acknowledge that the amounts
specified in Exhibit C for each improvement are estimates only and that total
reimbursable costs shall be based on Developer’s actual costs as set forth in this
Section 5.04.3. Reimbursement shall be provided timely, in accordance with
Applicable Law, following City’s collection of funds from the following sources:
(1) Development Impact Fees paid by the Project for the improvements
specified with respect to the SLR SP impact fees or the City-wide
transportation impact fees, as applicable;
(2) Development Impact Fees paid to the City for other development in the
SLR SP Area that are not committed to repayment obligations under other
Reimbursement Agreements;
(3) Development Impact Fees paid to City from developers who contribute, or
have contributed, to the impact associated with the improvements installed
by Developer;
(4) Capital Facilities taxes or assessments in a Community Facilities District;
and
(5) Property tax increment revenue in an Enhanced Infrastructure Financing
District.
(b) Backbone infrastructure that is larger than the minimum size or standard as
identified in the Standard Specifications and Engineering Design Standards may
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be considered to be oversized and shall be subject to review and approval by the
City prior to being included in a separate reimbursement agreement. The
Developer may be reimbursed by other private development(s) for that
developments’ Fair Share of the cost to construct sewer and water infrastructure
per San Luis Obispo Municipal Code sections 16.20.100 and 16.20.110. The
Developer will provide a study identifying the benefit area for each such
reimbursement agreement, conforming to San Luis Obispo Municipal Code
section 16.20.110, for review and approval of the City Utilities Department, and
may provide for reimbursement for segments of infrastructure which meet a
utility’s minimum size standard if the study shows those minimally sized facilities
to benefit identified additional developments.
(c) To the extent permitted by law, City shall impose as a condition of approval on
any project that benefits from the oversized or accelerated improvements or
facilities described in this Section 5.04.3(a) such project’s proportionate fair share
of the cost of the improvements eligible for reimbursement as set forth in
Exhibit C.
(d) Under no circumstances shall the City be obligated to fund reimbursement from
its General Fund or other discretionary resources or from funds which may not be
lawfully used for that purpose or to advance funds to Developer as reimbursement
before those funds are collected from others.
(e) Failure by the City to collect funds, or error by the City in calculating the amount
to collect, from the sources identified in subsection 5.04.3(a) above shall not
subject the City to any liability, obligation, or debt to Developer. Notwithstanding
the foregoing, the City shall reimburse Developer pursuant to the terms of this
Development Agreement with respect to all such funds actually collected by the
City. Failure by the City to reimburse Developer after the City collects such
funds shall entitle Developer to exercise its remedies under Article 12. For any
improvement subject to reimbursement under this section, Developer shall
provide City with evidence of the actual hard and soft costs of each of the
improvements in the form of receipted bills, canceled checks, and contracts.
Approval of reimbursement may occur in phases as projects are accepted by City.
Regardless of Developer’s claimed costs incurred in constructing the reimbursable
improvements, City has the authority, through its Director or designee, in the
exercise of his or her reasonable discretion, to determine the amount subject to
possible reimbursement for each improvement.
(f) In the event any owner or developer pays all or a portion of the fees or
assessments identified in subsection 5.04.3(a)(1)–(5) above under protest, the City
need not make reimbursements under this Development Agreement until the
limitation period for suit for a refund of such funds paid under protest has passed,
and no court action (“Action”) has been instituted. If an Action is instituted
seeking refund of funds paid under protest, or to prevent the City from collecting
such funds, or challenging any provision of this Development Agreement, the
City shall not pay over such funds to Developer until the Action has been
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concluded and the authority of the City to collect such funds and reimburse the
Developer has been sustained. The City shall promptly notify Developer in
writing of any Action. The City shall reasonably support Developer’s efforts to
participate as a party to an Action, to defend an Action or settle an Action.
Furthermore, the City may tender defense of an Action to Developer. If, within 15
days of the City’s mailing a notice in compliance with Section 15.08 below
requesting that Developer defend the Action, should Developer thereafter fail to
undertake the defense of the Action at Developer’s sole cost and expense, the City
may stipulate to return of the funds collected under protest, to cease collecting
such funds, or enter into any other settlement of the Action acceptable to the City,
and Developer shall lose any right to reimbursement under this Development
Agreement of the amount contested in the Action. Developer shall further
reimburse the City for its costs and attorneys’ fees incurred in defense of the
Action, including reasonable payment for legal services performed by the City
Attorney or City’s outside counsel, and for any liability the City incurred in the
Action. In addition, if the City fails to impose a requirement upon development
projects to pay their respective prorated share of the improvements specified in
Exhibit “C” or fails to collect such funds, Developer may exercise all of its legal
rights to attempt to collect such funds from the owners or developers of the
benefitted properties, which legal rights shall not be interpreted to include an
action against the City. If Developer attempts to collect such funds from such
owners or developers, the City shall assign to Developer all of its rights to collect
such funds under this Development Agreement.
(g) The City reserves the right to offset any funds it collects from the sources
identified in this Section 5.04.3 against any unpaid fees, debts or obligations of
Developer to the City. The City shall provide Developer with notice, in
accordance with Section 15.08 and Article 12, of its intent to offset any collected
funds against unpaid fees, debts or obligations described in the notice, and
provide Developer with a reasonable opportunity to pay such fees, debts, or
obligations.
(h) Developer’s right to reimbursement under this Section 5.04.3 shall survive
termination of this Development Agreement until the earlier of (i) Developer
having been fully reimbursed or (ii) 25 years following the Effective Date. Such
obligations shall survive the termination of this Development Agreement.
Section 5.04.4. Other Shortfalls of City. Developer understands and
acknowledges that in the event that the residential portions of the Project are developed in
advance of the commercial portions of the Project, the costs to City of serving the residential
portions of the Project may exceed the fees, charges and revenues generated by or as a result of
the residential portions of the Project. Accordingly, in order to mitigate potential shortfalls to the
City’s General Fund resulting from such event, the Parties agree to implement an early
residential development fee (the “Early Residential Development Fee”) to cover the costs of
such municipal services. Each year in conjunction with the annual review of this Development
Agreement, Developer shall pay to the City an Early Residential Development Fee in the amount
of two hundred sixty-two dollars ($262.00) per residential unit for which the City has previously
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approved the final sign-off of the building permit for such residential unit (other than for a Model
Home, as contemplated by Section 7.13.07, below). Upon the issuance of the first certificate of
occupancy for any commercial use in the Project, the obligation to pay the Early Residential
Development Fee shall terminate and shall thereafter no longer be collected by or paid to the
City in conjunction with the annual review of this Development Agreement. Prior to the first
anniversary of the Effective Date, Developer shall post a bond in the amount of Three Hundred
Thousand Dollars ($300,000.00) in favor of the City to secure Developer’s performance of its
obligations under this Section 5.04.4, which such bond shall be maintained for one (1) year after
issuance of the first certificate of occupancy for any commercial use in the Project.
Adjustments to Early Residential Development Fee - Commencing upon the fifth
anniversary of the Reset Date, and upon the day that immediately follows the passage of each sixty
month period thereafter (hereinafter collectively the “Adjustment Date(s)”), the Early Residential
Development Fee payable hereunder shall be adjusted in direct relation to the same ratio of the
percentage change, if any, in the Consumers Price Index for all Urban Consumers (CPI-U) All
Items, 1978 Revised, (1982-84=100) Los Angeles, as issued by the U. S. Department of Labor,
Bureau of Labor Statistics, for the month immediately preceding the Adjustment Date (the
“adjustment date index”), over said index for the month of the date of the annexation of the
Property (the “beginning index”). The parties acknowledge that the indexes herein referenced are
not always published in a fashion which allows for adjustment exactly upon each annual adjustment
date. If the described adjustment index shall no longer be published, another index generally
recognized as authoritative shall be substituted by agreement of the parties. If they are unable to
agree within thirty (30) days after demand by either party, a substituted index shall, upon
application by either party, be selected by the Chief Officer of the Los Angeles Regional Office of
the Bureau of Labor Statistics, its successor, or another entity providing similar services as mutually
agreed by the parties. If the index is changed so that the adjustment date index differs from the
beginning index, the index shall be converted in accordance with the conversion factor published by
the United States Department of Labor, Bureau of Labor Statistics.
Section 5.04.5. Subsidy for Third Party City Costs Related to Prado Overpass. In
the event that (i) the first Final Map for the Project has been approved for recordation by the City
Council prior to September 1, 2018, and (ii) as of July 1, 2019, the Developer has not paid the
Mitigation Measure fair share fee (the “Prado Road Interchange Mitigation Fee”) related to
the construction of the Prado Overpass and related facilities (the “Prado Road Interchange”),
then Developer shall pre-pay up to One Million Five Hundred Thousand Dollars ($1,500,000) of
the Prado Road Interchange Mitigation Fee to reimburse City for documented third-party costs
related to the planning, entitlement, and/or construction of the Prado Road Interchange.
Section 5.04.6. Timing of Payment for Balance of Prado Road Interchange
Mitigation Fee. The balance of the Prado Road Interchange Mitigation Fee shall be paid prior to
the issuance of occupancy permits when any combination of land uses with permitted occupancy
within the San Luis Ranch Specific Plan Area generate a cumulative total of 233 “PM Peak Hour
Trips” or more based upon Table 25 of the San Luis Ranch Specific Plan Multimodal
Transportation Impact Study, as summarized in the table below (the “Initial Trigger Date”).
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For example, if occupancy permits have been issued for 200 Single Family
Residential Units and 77 Multi-Family Residential Units the total PM peak hour trip generation
would be at 232.97 and no further occupancy permits for any land uses in the SLR SP Area
would be issued until the balance of the Prado Road Interchange Mitigation Fee is paid.
As an alternative to paying the Prado Road Mitigation Fee upon the Initial Trigger
Date, as specified above, prior to the PS&E Trigger Date, defined below, Developer may deposit
an irrevocable letter of credit (“Letter of Credit”) with the City, in a form subject to the
reasonable approval of the City Attorney, for the then current estimate of the balance of the
Prado Road Interchange Mitigation Fee. Upon sixty percent (60%) design submittal of
CalTrans’s Plans, Specifications and Estimate for the Prado Road Interchange (the “PS&E
Trigger Date”), the remaining balance of the Prado Road Interchange Mitigation Fee shall be
fully due and payable. At any time prior to the PS&E Trigger Date, the City may request, and
Developer shall pay, the amount reasonably estimated by the City as necessary to cover any
anticipated third-party pre-construction costs for the Prado Road Interchange. In the event
Developer fails to pay such costs within thirty (30) days of City’s written demand, City may call
the Letter of Credit due and payable. Following Developer’s payment upon City’s demand,
Developer may deposit a revised Letter of Credit with the City, with a principal balance reduced
in the amount of such payment.
ARTICLE 6. COMMITMENTS RELATED TO PUBLIC IMPROVEMENTS
Section 6.01. Backbone Infrastructure Improvement Plan. The SLR SP Backbone
Infrastructure (“Backbone Infrastructure”) is planned to be designed and constructed in
accordance with the SLR SP, EIR and SEIR. The Parties acknowledge that further analysis may
result in a more cost-effective approach to the provision of the planned infrastructure to
adequately serve development of the SLR SP Area, and that Figures [__] of the SLR SP may be
modified in accordance with Section 9.03 without the need for amendment of this Development
Agreement.
Section 6.01.1. Specific Plan Improvements. The improvements described in the
SLR SP and Resolution No. 10822 (2017 Series) certifying the EIR, constitute the SLR SP
“Improvement Plan.”
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Section 6.01.2. The Improvement Plan may be amended by agreement of the
Parties to take advantage of new technologies, to respond to changes in the underlying land use
assumptions upon which the plan is based, or for such other reasons as the Parties may agree,
consistent with the Project EIR, SEIR or a subsequent environmental review, if required.
Section 6.02. Construction and Dedication of Project Facilities and Infrastructure.
Section 6.02.1. Construction and Funding by Developer. The City may, in any
manner consistent with the terms and provisions of this Development Agreement, require
Developer to construct or to fund the construction of any Project Facilities and Infrastructure
when needed to satisfy the Backbone Infrastructure Improvements Plan, the EIR, and SEIR.
Section 6.02.2. Oversizing of Project Facilities and Infrastructure.
(a) In addition to requiring Developer to construct or to fund the construction of
Project Facilities and Infrastructure, City may require any Project Facilities and
Infrastructure constructed or funded by Developer under Section 6.02.1 above to
be oversized to serve projects or areas other than the Project or the Property,
provided that:
(1) City shall cooperate with Developer and shall exhaust all reasonable
efforts and diligently pursue all necessary or appropriate actions related to
the establishment of a Financing Mechanism to provide such additional
funding;
(2) City shall grant a fee credit, enter into private reimbursement agreements,
or reimburse the costs associated with Developer’s funding or construction
of that portion of any such oversized improvements that is attributable to
projects or areas other than the Project or the Property, pursuant to
subsection 5.03.2(e) above.
(b) If the incremental construction of facilities required by the SLR SP would involve
significant inefficiencies for a component of the Project that the City reasonably
finds unacceptable, it may require Developer to construct or provide advance
funding for the construction of oversized improvements required by the SLR SP.
For example, if the Project generates a need for an 18-inch sanitary sewer line, but
other projects reasonably may be expected to use that sewer line and thereby
increase the required capacity of such line to 24 inches, City may require
Developer to construct or fund the construction of a 24-inch sewer line (but shall
provide reimbursement as described in subsection 5.04.2(b) above and as
otherwise required under the Subdivision Map Act).
Section 6.02.3. Dedications.
(a) To the extent rights-of-way or other interests in real property owned by Developer
within the Property are needed for the construction, operation or maintenance of
Project Facilities and Infrastructure, Developer shall dedicate or otherwise convey
such rights-of-way or other interests in real property to City by the earlier of
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(i) when such rights are actually needed for Project Facilities and Infrastructure or
(ii) before approval of a final subdivision map for the Project that includes such
rights-of-way or other interests in real property. Such rights-of-way or interests
shall be dedicated or otherwise conveyed in the widths set forth in the SLR SP or
as depicted on the tentative map.
(b) Any public improvements constructed by Developer and conveyed to City, and
any rights-of-way or other real property interests conveyed to City, shall be
dedicated or otherwise conveyed: (i) free and clear of any liens unacceptable to
the City and (ii) except as otherwise agreed to by City, in a condition free of any
toxic materials; provided, however, that, City shall be responsible for the
condition of any real property acquired by eminent domain. Nothing herein shall
affect or prevent City’s right to pursue claims against third parties under
applicable law.
Section 6.03. Cooperation as to Project Facilities and Infrastructure.
Section 6.03.1. In General. City shall cooperate with Developer and take all
actions necessary or appropriate to facilitate the development of Project Facilities and
Infrastructure. Such cooperation shall include, without limitation: (i) the diligent, timely and
lawful exercise by City of its power of eminent domain to acquire any rights-of-way or other real
property interests City and Developer agree are needed for Project Facilities and Infrastructure
(provided that the costs of any such acquisition shall be borne by the Project); and (ii) City’s
diligent efforts to work with other landowners and governmental and quasi-governmental
agencies to allow timely approval and construction of such Project Facilities and Infrastructure.
(a) Developer shall exhaust all reasonable efforts and diligently pursue acquisition of
all necessary easements and/or rights of way not currently owned or controlled by
City or Developer which are required to construct the Off-Site Improvements. For
purposes of this Section 6.03.1, the term “reasonable efforts” shall mean that the
Developer has made a commercially reasonable written offer to purchase the
property interest at fair market value, in accordance with an appraisal conducted
by an MAI appraiser.
(b) If after exercising reasonable efforts Developer is unable to acquire the necessary
easements and/or rights of way, City, upon written request of Developer, shall, in
City’s sole discretion: (1) require Developer to construct functionally equivalent
alternative improvements to those previously approved, provided that such
alternative improvements are equally or more effective in addressing the impact;
(2) pursue acquisition of the real property interests by means of eminent domain;
or (3) if the City declines to exercise powers of eminent domain, abandon or defer
the Obligation in accordance with Section 66462.5 of the Subdivision Map Act.
City and Developer acknowledge that eminent domain is a discretionary process
and that City cannot commit to its use unless and until all appropriate
notifications, hearings and proceedings have been undertaken. If City chooses to
pursue acquisition of the real property interests by means of eminent domain, City
shall take all reasonable steps necessary towards that endeavor, including
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undertaking appraisals, noticing property owners, noticing and holding required
public hearings and meetings, and following any other procedures required for
pre-judgment possession and Developer shall pay all costs reasonably incurred by
City related to, arising from, or associated with such acquisition or condemnation
proceedings, including but not limited to, attorneys’ fees, expert witness fees, and
jury awards of any kind. In addition, Developer shall indemnify, defend and hold
City harmless from and against any and all claims, liabilities or causes of action
of any kind associated with City’s acquisition of such real property interests,
excluding therefrom any claims, liabilities or causes of action arising from City’s
gross negligence or willful misconduct.
(c) City shall not unreasonably delay the recordation of the Final Map or the issuance
of any grading and building permits for private improvements on the Property
during the pendency of any activities under this Section except as necessary to
protect public health and safety. In addition, and not by way of limitation, City
shall not delay the processing, approval, or recordation of any Final Map for the
Project due to Developer’s inability to obtain any off-site land acquisitions or
easements; provided, however, that (i) City shall not require any engineering
other than conceptual plans until the areas of such acquisitions or easements are
obtained or the improvements are waived or alternative improvements are
identified, as described above, and (ii) Developer and City shall include such land
acquisitions or easements within the scope of any subdivision improvement
agreement and related bonds. In order for the Developer to satisfy financing
requirements and to complete approval and recordation of the Final Map while
Developer is attempting to acquire any remaining off-site acquisitions, City shall
allow feasible interim alternatives that do not require offsite acquisitions in order
for the Project to function, including but not limited to a controlled intersection in
lieu of a roundabout at the intersection of Dalidio Drive and Froom Ranch Way,
in accordance with Applicable Law, including CEQA, and subject to approval by
the City Manager, which shall not be unreasonably withheld, delayed or
conditioned.
(d) Upon acquisition of the necessary interest in land, or upon obtaining right of
entry, either by agreement or court order, Developer shall commence and
complete the public improvements. This requirement shall be included, and, if
necessary, detailed, in any subdivision improvement agreement entered between
the Developer and the City pursuant to Government Code section 66462.
(e) If and to the extent this Section 6.03.1 demands more of Developer than does
Section 66462.5 of the Subdivision Map Act, this Section shall apply in addition
to the Developer’s obligations under that statute.
(f) City acknowledges that the execution and recordation of this Development
Agreement satisfies the requirements of Condition of Approval 36 related to
recordation of an agreement between City and Developer.
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(g) City acknowledges that Condition of Approval 70, which states, “Easements and
encroachment permits from Caltrans shall be secured to cross the highway, and
shall include the installation of a new sewer casing per requirements of the
encroachment permit” may be satisfied following recordation of the Final Map,
but prior to occupancy of any structure in the Project.
(h) City acknowledges that Condition of Approval 95, which states, “The project plan
and reports shall show compliance with the City’s Floodplain Management
Regulations and FEMA requirements. This project is located within an unstudied
A zone and adjacent to an AE zone. The required conditional Letter of Map
Revisions Based on Fill (CLOMR-F) shall be processed and approved by FEMA
prior to commencement of construction or placement of fill within the Special
Flood Hazard Area (SFHA). The final LOMR-F shall be submitted to FEMA,
along with the required Community Acknowledgement form, within 6 months of
the completion of the grading. The LOMR-F shall be approved by FEMA prior to
acceptance of the final building pad and development grades by the City of San
Luis Obispo and prior to building permit issuance” may be satisfied by posting a
bond for grading restoration costs, in an amount subject to the approval of the
City Engineer and in a form subject to the approval of the City Attorney, which
will allow limited improvements within the current boundaries of the floodplain
area to be constructed, as follows: (i) site grading and backbone infrastructure
improvements may be undertaken and completed that are consistent with a
submitted CLOMR-F covering the area of the proposed grading; (ii) following
approval of such CLOMR-F by FEMA, the grading shall be confirmed as
consistent with the approved CLOMR-F and, if necessary, any remedial work
shall be undertaken; (iii) following certification that grading is consistent with an
approved CLOMR-F, City and Developer shall work in good faith with one
another towards allowing Developer to proceed with additional improvements
within the current boundaries of the floodplain area taking into consideration:
(i) the status of the LOMR-F and any feedback received from FEMA; and
(ii) compliance with the City’s Floodplain Management Regulations. The Parties
acknowledge that there may be more than one CLOMR-F or LOMR-F for the
Project Site.
Section 6.03.2. Temporary Access Licenses. City agrees to grant to Developer a
temporary non-exclusive access license in a form and in a location subject to the approval of the
City Attorney, the City’s Natural Resources Director, and Developer, across the property
commonly known as the “City Farm Property” (APNs: 053-152-006, 053-152-007, and
053-152-008) to allow reasonable access for Project construction and for agricultural operations
on the Property. Said license shall be subject to the consent and approval of any current lessee
on said property, whose leases shall also be subordinated to the related easement to be granted by
City to Developer. In return, Developer shall grant the City a temporary non-exclusive access
license in a mutually agreeable location to serve the agricultural operations of the City Farm
Property. Prior to Developer’s use of the temporary access license for construction purposes,
Developer shall, at its sole cost and expense, design and install an all-weather road along the
entirety of the access roadway area. During the term of this temporary non-exclusive access
license, Developer shall, at its sole cost and expense, maintain the roadway and the all-weather
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surface in good and passable condition. This temporary non-exclusive access license shall
automatically terminate and be replaced by the below referenced Permanent Access Easements
upon completion of Project construction.
Section 6.03.3. Permanent Access Easements. City agrees to grant to Developer
a permanent non-exclusive access easement in a form and in a location subject to the approval of
the City Attorney, the City’s Natural Resources Director, and Developer across the City Farm
Property to allow access for agricultural operations on the Property. Said easement shall be
subject to the consent and approval of any current lessee on the property, whose leases shall be
subordinated to the easements to be granted by City to Developer. In return, Developer shall
grant City a permanent non-exclusive access easement in a mutually agreeable location to serve
the agricultural operations of the City Farm Property. City and Developer shall have mutual
responsibility for maintenance of the access easements and the all-weather road which shall be
allocated as follows: 25% City and 75% Developer.
Section 6.03.04. Cooperation Related to Off-Site Improvements. To the extent
that Developer is required to construct any Off-Site Improvements that require work on land
outside of the control of Developer, including without limitation related to compliance with
Conditions of Approval 9, 12, and 12.a, Developer may apply for approval from the City Public
Works Director to extend the timeline for completion of such improvements upon posting of
appropriate security, such as bonding, for the completion of such improvements, which approval
shall not be unreasonably withheld.
ARTICLE 7. OTHER COMMITMENTS OF CITY AND DEVELOPER
Section 7.01. Mutual Cooperation for Other Governmental Permits. City and Developer,
as appropriate, shall each be responsible to apply to the respective governmental or quasi-
governmental agencies for necessary permits and approvals for development and use of the
Property (e.g., agencies having jurisdiction over water supply; wastewater treatment, reuse and
disposal; access to the Property; wetlands-related and other biological issues). City and
Developer shall each take any and all actions as may be necessary or appropriate to process
successfully such permits and approvals, provided such permits and approvals are consistent
with the SLR SP and agreed by the City and Developer to be reasonably necessary or desirable
for the construction, maintenance or operation of the Project.
Section 7.02. Timing of Development.
Section 7.02.1. Timing Requirements.
(a) Developer shall be obligated to comply with the terms and conditions of the
Project Approvals, the SLR SP, and this Development Agreement when specified
in each. The Parties acknowledge that the rate at which the Project will develop
depends upon numerous factors and market conditions that are not entirely within
Developer’s or the City’s control. The Parties wish to avoid the result of Pardee
Construction Co. v. City of Camarillo, 37 Cal.3d 465 (1984), where the failure of
the parties there to expressly provide for the timing of development resulted in the
court’s determination that a later-adopted initiative restricting the timing of
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development prevailed over the parties’ agreement. Accordingly, the Parties
acknowledge that Developer shall have the right to develop the Project at such
time Developer deems appropriate in the exercise of its subjective business
judgment except as provided in subsections (b) and (c), below.
(b) Developer may proceed with the development of any portion of the Project
consistent with the Project Approvals, or make any financial commitment
associated with any such development when, in Developer’s sole and absolute
discretion, Developer determines it is in Developer’s best financial or other
interest to do so. The foregoing sentence shall not, however, limit any obligation
of Developer under this Development Agreement with respect to any
development activities that Developer chooses to undertake hereunder, nor shall
anything herein be interpreted to relieve Developer from compliance with any
condition of approval, environmental mitigation compliance measure or other
applicable regulatory requirement under Applicable Law.
(c) In accordance with Section 17.88.020.B of the City’s Municipal Code, the City
has found that the SLR SP and this Development Agreement are consistent with
the policies and intent of the City’s Growth Management Ordinance. Section
7.7.1 of the SLR SP relating to timing of improvements is hereby incorporated by
reference.
Section 7.03. Dedication of Park Lands. Developer shall dedicate land to satisfy its
obligations under the Quimby Act, the General Plan Park Element, and Applicable Law. At a
minimum, Developer shall dedicate 2.8 acres of land within the Property for use as public park
land. Developer shall construct all park and recreation improvements as required by the
conditions of approval subject to the City’s Parks and Recreation Commission’s review and
approval. Ongoing maintenance and operation of the park facilities shall be funded by the Project
residents pursuant to one or more of the Funding Mechanisms described in Section 5.02 above
and/or assessments under homeowner CC&Rs, and shall not be payable from the City’s General
Fund or other community-wide resources. Should the land the Developer offers for dedication be
insufficient to meet Developer’s obligation under Applicable Law, Developer shall dedicate
sufficient additional land off-site or pay an lieu fee in the maximum amount of Three Million
One Hundred Seventy Five Thousand Twenty Six Dollars ($3,175,026) to meet its requirement
after applicable credits for additional park lands provided. Any in lieu fee assessments shall be
based upon the amount of the fees in place as of the date of the approval of this Development
Agreement. City shall prioritize any in lieu fees paid by Developer for improvements at Laguna
Lake Park, subject to City’s review of its funding constraints and obligations.
Section 7.04. Dedication of Open Space/Agricultural Lands. To compensate for the loss
of onsite agricultural lands and to meet the open space objectives of the General Plan, Developer
shall dedicate, in a form subject to the approval of the City Attorney and the City’s Natural
Resources Director, a conservation easement or series of conservation easements in accordance
with the SLR SP, the Project Approvals, and subsections (a) through (h) below.
(a) Land designated in the Specific Plan as “Open Space” shall be subject to an
“Open Space Easement”.
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(b) Land designated as “Agriculture Heritage Facilities and Learning Center” shall be
subject to a “Historic Preservation and Agricultural Easement”.
(c) Land designated as Agriculture shall be restricted by an “Agricultural Easement”.
(d) Developer shall mitigate a portion of the agricultural/open space obligations for
the Project by obtaining a perpetual Agricultural Easement off-site: (i) on
approximately 30 acres within a larger parcel of land identified as Assessor Parcel
No. 067-181-010; or (ii) on comparable land subject to the approval of the City’s
Natural Resources Manager.
(e) Developer shall offer for dedication the above-referenced easements in
accordance with the requirements of the Project Approvals.
(f) Developer may use land subject to the above-referenced easements in accordance
with the restrictions of those easements, the Project Approvals, and Applicable
Law.
(g) Prior to issuance of any grading permits for the Property, Developer shall provide
that for every one (1) acre of on-site Important Farmland (Prime Farmland,
Farmland of Statewide Importance, and Unique Farmland) that is permanently
converted to non-agricultural use as a result of the Project’s development, that
one (1) acre of land of comparable agricultural productivity shall be preserved
through a perpetual Agriculture Easement.
(h) Developer shall comply with the Operational Guidelines, terms and conditions for
the Agricultural Land as set forth in Exhibit E, which are incorporated herein by
this reference.
Section 7.05. Affordable Housing. In furtherance of the City’s inclusionary housing
goals, Developer shall provide affordable housing within the Project as set forth in Exhibit F.
The Developer shall integrate affordable units into neighborhoods as required for the on-site
residential development. Developer may provide the affordable units required for the commercial
portion of the development on-site, off-site or through the payment of in-lieu fees.
Section 7.06. Energy.
(a) Developer shall provide for accelerated compliance with the City’s Energy
Conservation Goals and its Climate Action Plan by implementing energy
conservation measures significantly above City standards and norms by providing
for solar PV energy generation for 100 percent of onsite electrical demand at
build-out. The Project shall also include energy efficiency standards in excess of
the Building Code in effect in the City on the Vesting Date and implement the
feasible strategies set forth in Section 5.4.2 of the SLR SP.
(b) Developer shall provide sustainability features including: (i) housing that meets
the 2019 net zero building and energy codes or, if the 2019 building and energy
codes are not yet adopted upon building permit application, equivalent energy
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features shall be provided to the approval of the Community Development
Director, (ii) implementing any future City-wide policy regarding zero carbon
emissions, (iii) solar electric panels, (iv) integrated power outlets for electric
vehicles and electric bicycles, (v) building design that maximizes grey water
usage, and (vi) work-at-home options with high-speed fiber-optic connectivity.
Section 7.07. Water. Developer shall provide for accelerated compliance with the
Climate Action Plan by implementing special water conservation measures to reduce the use of
potable water by Project households to 35 percent below the City-wide average as of July 18,
2017 (95-gpcd).
(a) Developer shall install water improvements necessary to serve the Project as
shown in Figure 7.1 of the SLR SP.
(b) Notwithstanding anything herein to the contrary, Developer shall comply with the
California Water Code and the regulations imposed by the City in its capacity as
the Groundwater Sustainability Agency pursuant to the Sustainable Groundwater
Management Act (“SGMA”) in all matters related to the Project. Developer
acknowledges that SGMA regulations will be implemented after the Vesting Date
of this Development Agreement and likely throughout its term and nevertheless
agrees to comply with them as to the Project.
(c) Developer reserves all groundwater or other water rights with respect to the
Property and shall be entitled to irrigate agricultural or open space land with
ground or well water, to the extent that such reservation and action does not
violate Applicable Law and so long as such water meets or exceeds all applicable
water quality standards.
(d) Any and all tentative subdivision maps approved for the Project shall comply with
Government Code Section 66473.7 if, and to the extent, required by Government
Code Section 65867.5(c).
Section 7.08. Wastewater. Developer shall provide sufficient wastewater capacity in the
force main between Laguna Lift Station and the plant’s headworks structure to convey the
wastewater generated by the Project as shown in Figure 7.3 of the SLR SP and as documented in
the Project’s sewer design narratives. The City has approved a sewer design exception for the
Project, and, to offset such exception, prior to recordation of the Final Map, Developer shall pay
City Three Hundred Thousand Dollars ($300,000) (the “Capacity Offset Fee”). The City shall
use the Capacity Offset Fee to establish a grant program for existing City residents to replace or
upgrade existing sewer laterals equivalent to 66,000 gallons per day of sewer capacity. Each
linear foot of replaced private lateral under such grant program shall have a credit of 17 gallons
per day, or approximately 64 residential laterals having an average length of 60 feet within the
Laguna Sewer Service Area.
Section 7.09. Recycled Water Facilities. Developer shall provide the recycled water
improvements shown in Figure 7.2 of the SLR RP.
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Section 7.10. Storm Drain Facilities. Before approval of a Final Subdivision Map or
building permit for a use that does not require a map, Developer shall provide storm drain
facilities as set forth in Figure 7.4 of the SLR SP adequate to accommodate the storm water
runoff from the area subject to such Map or building permit.
Section 7.11. Floodplain Management. Before approval of a Final Subdivision Map or
building permit for a use that does not require a map, Developer shall construct or make all
necessary grading and drainage improvements in accordance with the SLR SP Floodplain
Management Plan and EIR. The City shall allow building permits to be issued in areas that are
within a mapped floodplain upon: (i) certification of compliance with the SLR SP Floodplain
Management Plan and (ii) a covenant by the Developer to purchase flood insurance or other
similar measure until such time as FEMA has approved a Letter of Map Revision for the
Property.
Section 7.12. Traffic and Circulation Improvements. Developer shall construct
improvements to satisfy the traffic mitigation measures and bicycle and multimodal
improvements as set forth in Resolution No. 10822, conditions of approval and for backbone
infrastructure for the Project, as modified by Sections 5.04.5 and 5.04.6, hereof. For any
improvements required prior to initial occupancy, such improvements may be secured through
the posting of a bond, which will allow building permits to be issued concurrent with
construction of such improvements; provided, however, that final occupancy shall be permitted
only upon full completion of all such improvements.
Section 7.13. Miscellaneous.
Section 7.13.01. Covenants, Conditions, and Restrictions (CC&Rs). CC&Rs for
each subdivision within the Property shall state substantially the following: “This project is
within the boundaries of the SLR SP and, as such, is subject to design guidelines and
development standards incorporated into the SLR SP and the SLR SP Design Guidelines, both
on file with the Community Development Department of the City of San Luis Obispo.” Before
the City need approve a Final Subdivision Map or issue a building permit for a land use that does
not require a map, the CC&R disclosure statement referenced above shall be provided to the City
Attorney for review and approval.
Section 7.13.02. Public Improvements. Unless the Parties otherwise mutually
agree, the City shall own and maintain, or cause to be maintained, the following public
improvements:
(a) Potable water system and water tank, within public properties or public
easements;
(b) Sanitary sewer system, within public properties or public easements;
(c) Recycled water system, within public properties or public easements;
(d) Storm drain system, including continuous deflective separation (CDS) vaults or
other best management practices (BMP) facilities, within public properties or
public easements;
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(e) Public roadways;
(f) Public parks; and
(g) Public access, landscape, and utility easements.
Section 7.13.03. Public Utilities Easements. All land subject to public utilities
easements (PUEs); public water, sewer, or storm drain easements; and public access easements
shall be open and accessible to the City at all times.
Section 7.13.04. Design Review of Major Surface Public Facilities. Design
Review shall be completed for all major surface public facilities before construction.
Section 7.13.05. Design and Construction Standards for Sewer and Water
Facilities. All sewer, water and recycled water facilities shall conform to the Design and
Construction Standards in effect for the Project when improvement plans are submitted. The
submittal shall include all pertinent engineering analysis and design calculations. The plans shall
be subject to the Director of Public Works’ review and approval.
Section 7.13.06. Cable/Fiber Networking. Developer shall provide cable or
suitable conduit to each City facility, public park, or other lot designated for City or public use
within the Project for fiber networking. The cable or suitable conduit shall be shown on the joint
trench improvement plans and constructed before the final lift of asphalt is placed on adjacent
streets.
Section 7.13.07. Model Homes. Prior to recordation of any final map, City
agrees to issue building permits and occupancy certificates for the construction of model homes
(and related model home complex structures) that will be used by Developer for the purpose of
promoting sales of single-family residential units within the Project; provided, however, in no
event shall City be required to issue more than twenty-four (24) building permits for the
construction of model homes, and in no event shall Developer be permitted to sell or transfer any
model home until a Final Map has been recorded on that portion of the Project where the model
home is located.
ARTICLE 8. CONSIDERATION OF PERMITS AND APPROVALS
Section 8.01. Review and Action Generally. Upon Developer’s submission of any
complete application for an Approval together with any fees required under Article 5 and
required by City in accordance with Applicable Law, City shall use its best efforts to commence
and complete promptly and diligently all steps necessary to act on the application. Developer
shall promptly provide to City all information reasonably requested by City for its consideration
of any such application.
Section 8.02. Applicable Law. Except as otherwise specifically provided in this Article
8, all applications for Approvals submitted by Developer shall be considered by City in
accordance with Applicable Law. To the extent Developer applies for an approval that would
have the effect of amending a component of Applicable Law as defined in Section 4.01.1, the
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aspect of Applicable Law to be amended shall not apply to the City’s consideration of the
application for such request.
Section 8.03. General Plan and San Luis Ranch Specific Plan Amendments. The Parties
anticipate that Developer may request amendments to the General Plan or the SLR SP to respond
to changing circumstances and conditions. City is not obligated to approve any such application
and may, in the exercise of its legislative discretion, approve, deny or propose conditions or
modifications thereto, including conditions or modifications that might otherwise be prohibited
by the vested rights provided by this Development Agreement. Developer shall be afforded a
reasonable opportunity to review any such proposed conditions and modifications and to
withdraw its application for a General Plan amendment or Developer Specific Plan amendment
(in which case neither Developer’s proposed amendments nor the City’s proposed modifications
shall become effective).
Section 8.04. MMRP Application. When conducting an environmental review of any
application for an Approval, City shall review the MMRP to determine if any mitigation measure
contained in the MMRP as to the portion of the Property subject to this Development Agreement
should be incorporated into the design of, or made a condition of approval of, such Approval.
Section 8.05. Life of Approvals. Any Approval issued by City, including any Tentative
Tract Maps, shall continue in effect without expiration until the later of: (i) the expiration or
earlier termination of this Development Agreement or (ii) the date upon which such Approval
would otherwise expire under California law.
Section 8.06. Vesting Maps. The ordinances, standards and policies applicable to any
vesting tentative map, vesting parcel map, vesting subdivision map or any other type of vesting
map (“Vesting Map”) under California Government Code section 66474.2, and the ordinances,
policies and standards vested under any Vesting Map pursuant to California Government Code
section 66498.1(b) shall be those established as Applicable Law under this Agreement. If this
Development Agreement terminates before the expiration of any Vesting Map or the vested
rights provided thereby, such termination of this Development Agreement shall not affect
Developer’s right to proceed with development under such Vesting Map in accordance with the
ordinances, policies and standards so vested under the Vesting Map. In accordance with
California Government Code section 66456.1, Developer and the City have concurred that
multiple final maps may be filed.
ARTICLE 9. AMENDMENTS
Section 9.01. In General. This Development Agreement may be amended from time to
time only upon the mutual written consent of City and Developer and in compliance with
section 17.94.190 of the City’s zoning ordinance; provided, however, that in connection with the
transfer of any portion of Developer’s Rights and/or Obligations under this Development
Agreement to another person, entity, or organization pursuant to Article 13 below, Developer,
such transferee and City may agree that the signature of such transferee may thereafter only be
required to amend this Development Agreement insofar as such amendment would materially
alter the Rights and/or Obligations of such transferee. In no event shall the signature or consent
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of any “Non-Assuming Transferee” (as defined in Section 13.03 below) be required to amend
this Development Agreement.
Section 9.02. Future Approvals Do Not Require Amendments to Agreement. Except as
the Parties may otherwise agree, no amendment of this Development Agreement shall be
required in connection with the issuance of any Approval or an amendment to the MMRP. Any
Approval issued after the Vesting Date as to a portion of the Property shall be incorporated
automatically into this Development Agreement and vested hereby. Unless otherwise permitted
by this Development Agreement, however, City shall not amend or issue any Approval unless
Developer requests such an amendment or Approval.
Section 9.03. Operating Memoranda. The provisions of this Development Agreement
require a close degree of cooperation between City and Developer. The Parties acknowledge that
clarifications may be necessary with respect to the details of performance of City and Developer.
If and when, from time to time during the term of this Development Agreement, the Parties agree
that such clarifications are necessary and appropriate, the Parties shall effectuate such
clarifications through operating memoranda, approved in writing by each of them, which, after
execution, shall be attached hereto as addenda and become a part hereof. No such operating
memoranda shall constitute an amendment to this Development Agreement requiring public
notice or hearing. The City Manager, in consultation with the City Attorney, shall make the
determination on behalf of City whether a requested clarification may be effectuated pursuant to
this Section 9.03 or whether the requested clarification is of such a character as to constitute an
amendment hereof pursuant to Section 9.01 above. The City Manager shall be authorized to
execute any operating memoranda hereunder on behalf of City.
Section 9.04. Administrative Amendments. Upon the request of Developer for an
amendment or modification of any Project Approval, the Planning Director or his/her designee
shall determine: (a) whether the requested amendment or modification is minor when considered
in light of the Project as a whole; and (b) whether the requested amendment or modification
substantially conforms with the material terms of this Development Agreement and the
Applicable Law. If the Planning Director or his/her designee finds that the requested amendment
or modification is both minor and substantially conforms to the material terms of this
Development Agreement and the Applicable Law, the amendment or modification shall be
determined to be an “Administrative Amendment,” and the Planning Director or his/her
designee may approve the Administrative Amendment without public notice or a public hearing.
ARTICLE 10. ANNUAL REVIEW
Section 10.01. In General. The Community Development Director shall annually and
concurrently conduct: (i) the MMRP Evaluation as set forth in Section 11.01; and (ii) the
Development Agreement Review as set forth in Section 11.04 (collectively, the “Annual
Review”). With respect to the MMRP Evaluation, if the Community Development Director
determines that mitigation measures adopted by City in connection with its approval of the SLR
SP and the Zoning are not being implemented as set forth in the MMRP, he or she shall take any
appropriate remedial action as described in Section 11.01 below. Further, the Community
Development Director shall incorporate the results of the MMRP Evaluation into the review of
any applications for Approvals submitted thereafter.
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Section 10.02. Other Investigations and Evaluations. City may from time to time,
whether or not as a part of an Annual Review, investigate or evaluate any matter that is properly
the subject of an Annual Review.
ARTICLE 11. MMRP EVALUATION AND DEVELOPMENT AGREEMENT REVIEW
Section 11.01. MMRP Evaluation. During its Annual Review, City shall conduct the
MMRP Evaluation by evaluating whether the mitigation measures the City adopted upon its
approval of the SLR SP and the Zoning are being implemented as to the Property as set forth in
the MMRP.
Section 11.02. MMRP Implementation. As set forth in the MMRP, City shall consider in
connection with any application for an Approval the extent to which mitigation measures
described in the MMRP should be incorporated into the design of the project under consideration
or made conditions of the approval of the project. During an MMRP Evaluation, the City shall
evaluate its overall success over the previous year in implementing such mitigation measures and
consider any additional steps that may be appropriate to ensure, as Approvals are considered
over the following year, successful implementation of such mitigation measures (including, in
particular, mitigation measures that are the responsibility of City or other agencies with
regulatory authority over the Project).
Section 11.03. Enforcement. Developer shall be responsible only for those mitigation
measures the City requires to be incorporated into the design of the Project, including those that
are made conditions of any Approval. Failure to comply with any such design requirement or any
condition of approval shall be enforced in any manner authorized by Applicable Law.
Section 11.04. Development Agreement Review. The Community Development
Director shall review this Development Agreement annually to ascertain Developer’s good faith
compliance as to the Property (the “Development Agreement Review”). The Development
Agreement Review shall be conducted concurrently with the MMRP Evaluation as part of the
Annual Review pursuant to Article 10. In connection with the Development Agreement Review,
Developer shall provide information reasonably requested by City.
Section 11.05. Director’s Findings of Compliance. If the Community Development
Director finds good faith compliance by Developer with this Agreement, the Community
Development Director shall issue a “Finding of Development Agreement Compliance,” which
shall be in recordable form and may be recorded by Developer or any “Mortgagee” (as defined in
Section 14.01 below). Issuance of a Finding of Development Agreement Compliance and
expiration of the appeal period specified below without appeal, or confirmation by the City
Council of the issuance of the Finding of Development Agreement Compliance upon such
appeal, shall finally determine the Development Agreement Review for the applicable period.
Section 11.06. Finding of Development Agreement Noncompliance. If the Community
Development Director finds that Developer and/or a Transferee has not complied in good faith
with this Agreement, the Community Development Director shall proceed as specified in
sections 17.94.200–17.94.220 of the City’s Zoning Ordinance.
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ARTICLE 12. DEFAULT, REMEDIES, TERMINATION OF DEVELOPMENT
AGREEMENT
Section 12.01. Notice and Cure.
(a) Any failure by a Party to perform any term or provision of this Development
Agreement, which failure continues uncured for 60 days following written notice
of such failure from the other Party (unless such period is extended by written
mutual consent), shall constitute a default under this Agreement. Any such notice
shall specify the nature of the alleged failure and, where appropriate, how such
alleged failure may be cured. If the nature of the alleged failure is such that it
cannot reasonably be cured within 60 days, then commencement of the cure
within that time, and diligent prosecution to completion of the cure thereafter,
shall be timely. If the alleged failure is cured, then no default shall exist and the
noticing Party shall take no further remedial action and shall acknowledge the
cure in writing to the other Party. If the alleged failure is not cured, then a default
shall exist under this Development Agreement and the noticing Party may
exercise any of the remedies available under sections 12.03 through 12.05 below.
(b) No failure or delay in giving notice of default shall constitute a waiver of default;
provided, however, that the provision of notice and opportunity to cure is a
prerequisite to the enforcement or correction of any default.
Section 12.02. Actions during Cure Period.
(a) During any cure period specified under Section 12.01 and before delivery of a
notice of failure or default, the Party charged shall not be considered in default of
this Development Agreement. If there is a dispute as to the existence of a default,
the Parties shall otherwise continue to perform their obligations hereunder, to the
maximum extent practicable in light of the disputed matter, pending its resolution
or termination of this Development Agreement.
(b) City shall continue to process in good faith applications for Approvals during any
cure period, but need not approve any such application if it relates to a project as
to which there is an alleged default hereunder.
Section 12.03. Remedies of Non-Defaulting Party.
Section 12.03.1. In General. If any Party is in default under the terms of this
Agreement, the non-defaulting Party may elect, in its sole and absolute discretion, to pursue any
of the following courses of action: (i) waive such default; (ii) in City’s case, pursue
administrative remedies as provided in Section 12.04 below, (iii) pursue judicial remedies as
provided for in Section 12.05 below; and/or (iii) terminate this Development Agreement as and
to the extent permitted by Section 12.06 below and consistently with section 17.94.210 and
17.94.220 of the City’s Zoning Ordinance. In no event shall City modify this Development
Agreement as a result of a default by a defaulting Party except in accordance with the provisions
of Section 9.01 above.
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Section 12.03.2. Severability of Default. City acknowledges that the
development of the Project may be carried out by more than one person, entity or organization
under this Development Agreement (e.g., portions of Developer’s interest in the Property and
this Development Agreement may be transferred to another person, entity or organization, a
“Transferee” under Article 13 below). The Parties acknowledge and agree that, in accordance
with Article 13 below, more than one Transferee may be responsible for certain actions required
or forbidden by this Development Agreement and that more than one Transferee therefore may
be in default with respect to that action. Accordingly, if City determines to terminate or exercise
any remedy under this Development Agreement due to a default by Developer or by any
Transferee (hereinafter “Defaulting Developer”), such termination or other remedy shall apply
only with respect to the Rights and Obligations of such Defaulting Developer and any
termination of this Development Agreement as to any Defaulting Developer shall be deemed to
terminate only those Rights and Obligations arising hereunder between City and such Defaulting
Developer. City shall, to the extent possible, refrain from seeking any termination of this
Development Agreement or other remedy if such remedy would affect materially the ability of a
non-defaulting Developer and/or a non-defaulting Transferee (hereinafter “Non-Defaulting
Developer”) to realize the Rights provided hereunder. The Parties further acknowledge and
agree that in certain instances it may not be possible for City to exercise remedies against the
Defaulting Developer of one portion of the Project without affecting in some way a Non-
Defaulting Developer of the same or of some other portion of the Project.
Section 12.04. Administrative Remedies. Except as otherwise specifically stated in this
Development Agreement, City may exercise any and all administrative remedies to the extent
necessary or appropriate to secure compliance with this Agreement. Such administrative
remedies may include, among others, withholding building permits, certificates of occupancy or
other Approvals relating to that portion of the Project in default of this Agreement.
Section 12.05. Judicial Remedies. Except as otherwise specifically stated in this
Development Agreement, either Party may, in addition to any other rights or remedies, institute
legal action to cure, correct, or remedy any default, enforce any covenant or agreement herein,
enjoin any threatened or attempted violation hereof, enforce by specific performance the
Obligations and Rights of the Parties hereto or obtain any other remedy consistent with this
Agreement; provided, however, that in no event shall any person be entitled hereunder to
monetary damages for any cause, including breach of contract by a Party to this Agreement.
Notwithstanding the foregoing, City may enforce payment obligations under Applicable Law,
including under this Agreement and Developer may enforce City’s obligations under this
Agreement to pay or transfer money to the Developer by a writ of mandate or action for specific
performance. Nothing in this Section 12.05 shall be deemed to limit either Party’s rights under
the Government Claims Act, California Government Code section 810 et seq. For purposes of
instituting a legal action under this Agreement, any City Council determination under this
Development Agreement shall be deemed final agency action unless expressly stated otherwise.
Section 12.06. Termination Due to Default.
Section 12.06.1. In General. Either Party may terminate this Development
Agreement pursuant to Section 12.06.2 below and sections 17.94.190–17.94.220 of the City’s
Zoning Ordinance in the event of a default by the other Party, provided: (i) such default is
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prejudicial to the interests of the non-defaulting Party and is neither minor nor technical and (ii)
in the case of any termination by City, City first shall have exercised any and all administrative
or other remedies short of filing suit available to secure Developer’s compliance with this
Agreement; provided, however, that City shall not be required, as a prerequisite to initiating the
termination of this Agreement, to exercise its administrative and other non-judicial remedies for
a period of more than 180 days or such longer period to which the Parties may have agreed.
Termination of this Development Agreement by Developer or a Transferee as to any portion or
portions of the Property shall not affect the Rights or Obligations of Developer or any other
Transferee as to any other portion or portions of the Property.
Section 12.06.2. Procedures for Termination.
(a) Before any proposed termination of this Development Agreement pursuant to this
Section 12.06, and following the 180-day or longer period specified in Section
12.06.1 above, if applicable, a non-defaulting Party intending to seek termination
of this Development Agreement shall deliver to the defaulting Party (or Parties) a
written “Preliminary Notice of Intent to Terminate” this Agreement, and all
Parties shall meet and confer in good faith effort to agree upon an alternative to
termination that will afford the non-defaulting Party the benefit of its bargain
under this Agreement. If those discussions are not successful in resolving the
dispute, the non-defaulting Party desiring to terminate this Development
Agreement shall deliver to the defaulting Party a written “Final Notice of Intent
to Terminate”.
(b) Within 60 days after the City delivers a Final Notice of Intent to Terminate to a
defaulting Party, the City Council shall review the matter at a noticed public
hearing as set forth in California Government Code sections 65865, 65867, and
65868 and in sections 17.94.190–17.94.220 of the City’s Zoning Ordinance.
Termination shall be effective 30 days after such City Council review, unless the
default is sooner resolved to the mutual satisfaction of the Parties.
(c) Within 60 days after Developer delivers a Final Notice of Intent to Terminate to
City, the City Council shall consider whether City should take any further
curative action. Termination shall be effective 30 days following such City
Council consideration (or 90 days following delivery by Developer of a Final
Notice of Intent to Terminate if the City Council fails to complete its
consideration by that date), unless the default is sooner resolved to the mutual
satisfaction of the Parties.
Section 12.07. Judicial Reference. Pursuant to Code of Civil Procedure Section 638 et
seq., all legal actions shall be heard by a referee who shall be a retired judge from either the San
Luis Obispo County Superior Court, the California Court of Appeal, the United States District
Court or the United States Court of Appeals, provided that the selected referee shall have
experience in resolving land use and real property disputes. Developer and City shall agree upon
a single referee who shall try all issues, whether of fact or law, and report a finding and judgment
thereon and issue all legal and equitable relief appropriate under the circumstances. If Developer
and City are unable to agree upon a referee within ten (10) days of either Party’s written request
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to do so, either Party may seek to have a referee appointed pursuant to Code of Civil Procedure
Section 640. The cost of such proceeding shall initially be borne equally by the Parties. Any
referee selected pursuant to this Section 12.07 shall be considered a temporary judge appointed
pursuant to Article 6, Section 21 of the California Constitution. Notwithstanding the provisions
of this Section 12.07, either Party shall be entitled to seek declaratory and injunctive relief in any
court of competent jurisdiction to enforce the terms of this Agreement, or to seek to enjoin the
other Party from an asserted breach thereof, pending the selection of a referee on a showing that
the moving party would otherwise suffer irreparable harm. Upon the mutual agreement by both
Parties, any legal action may be submitted to mediation in accordance with rules to be mutually
agreed upon by the Parties.
ARTICLE 13. ASSIGNMENT, TRANSFER AND NOTICE
Section 13.01. Assignment of Interests, Rights and Obligations. Developer may transfer
or assign (“Transfer”) all or any portion of its Rights and Obligations under this Development
Agreement as to any portion of the Property (the “Transferred Property”) to any person
acquiring an interest in such Transferred Property, including, without limitation, purchasers or
ground lessees of lots, parcels or facilities on such Transferred Property (a “Transferee”). Any
such Transfer shall relieve the transferring party (a “Transferor”) of any and all Rights and
Obligations under this Development Agreement insofar as they pertain to the Transferred
Property, as provided in this Article 13.
Section 13.02. Transfers In General.
Section 13.02.1. In General. In connection with any Transfer of all or any
portion of the Project or the Property, other than a transfer or assignment to a “Non-Assuming
Transferee” as described in Section 13.03 below or a “Mortgagee” as defined in Section 14.01
below, the Transferor and the Transferee may enter into a written agreement regarding their
respective Rights and Obligations in and under this Development Agreement (a “Transfer
Agreement”). Any such Transfer Agreement may contain provisions: (i) releasing the Transferor
from any Rights and Obligations under this Development Agreement that relate to the
Transferred Property, provided the Transferee expressly assumes all such Rights and
Obligations, (ii) transferring to the Transferee rights to improve the Transferred Property and any
other Rights and Obligations of the Transferor arising under this Agreement, and (iii) addressing
any other matter deemed necessary or appropriate in connection with the Transfer.
Section 13.02.2. City Review of Release Provisions.
(a) A Transferor shall have the right, but not the obligation, to seek City’s consent to
those provisions of any Transfer Agreement purporting to release such Transferor
from any Rights and Obligations arising under this Development Agreement (the
“Release Provisions”). If a Transferor fails to seek City’s consent or City does
not consent to any such Release Provisions, then such Transferor may
nevertheless transfer to the Transferee any and all Rights and Obligations of such
Transferor arising under this Development Agreement (as described in Sections
13.02.1(i) and (ii) above) but, with respect to City, shall not be released from
those Rights and Obligations described in the Release Provisions to which City
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has not consented. If City consents to any Release Provisions, then: (i) the
Transferor shall be free from any and all Rights and Obligations accruing on or
after the date of any Transfer with respect to those Rights and Obligations
described in such Release Provisions and (ii) no default hereunder by Transferee
with respect to any Rights and Obligations from which the Transferor has been
released shall be attributed to the Transferor nor may such Transferor’s Rights be
canceled or diminished in any way by any such default. City may consent, or
conditionally consent, to all, none, or some of the Release Provisions.
(b) City shall review and consider promptly and in good faith any request by a
Transferor for City’s consent to any Release Provisions. City’s consent to such
Release Provisions may be withheld only if: (i) reliable evidence supports a
conclusion that the Transferee will be unable to perform the Rights and
Obligations proposed to be assumed by the Transferee pursuant to the Transfer
Agreement, (ii) the Rights and Obligations may not reasonably be allocable
among particular portions of the Project and Property, such as the Transferred
Property, (iii) the Transferor or Transferee fails to provide acceptable security, as
and if reasonably requested by City, to ensure the performance of the Rights and
Obligations proposed to be assumed by the Transferee pursuant to the Release
Provisions, or (iv) the Transferor or Transferee fails to provide information
reasonably requested by the City to assist it in making the determinations
described in this paragraph. In no event shall City unreasonably withhold consent
to any Release Provisions. City shall respond within 30 days to any request by a
Transferor for consent to any Release Provisions, and, if the City fails to respond
during such 30 day period, the City shall be deemed to have consented to the
Release Provisions.
(c) Subject to the provisions of paragraph (b) above, because and to the extent certain
Obligations arising under this Development Agreement may not reasonably be
allocable among portions of the Project, City may refuse to consent to release the
Transferor of one portion of the Project from such Rights and Obligations under
this Development Agreement even though the Rights and Obligations are being or
have been assumed by the Transferee of some other portion of the Project.
Section 13.03. Non-Assuming Transferees. Except as otherwise required by a
Transferor, the Obligations of a Transferor shall not apply to any purchaser of any property that
has been established as a single legal parcel for nonresidential use that does not require any
further on-site or off-site infrastructure. The Transferee in such a transaction and the successors
and assigns of such a Transferee (“Non-Assuming Transferees”) shall be deemed to have no
Obligations under this Agreement, but shall continue to benefit from the Rights provided by this
Development Agreement for the duration of its term. Nothing in this section shall exempt any
Transferred Property transferred to a Non-Assuming Transferee from payment of applicable fees,
taxes and assessments or compliance with an Approval or Applicable Law.
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ARTICLE 14. MORTGAGEE PROTECTION
Section 14.01. In General. The provisions of this Development Agreement shall not
limit Developer’s right to encumber the Property or any portion thereof, or any improvement
thereon by any mortgage, deed of trust or other device securing financing with respect to such
portion. City acknowledges that lenders providing such financing and other “Mortgagees”
(defined below) may require certain interpretations and modifications of this Development
Agreement and agrees upon request, from time to time, to meet with Developer and
representatives of such lenders to negotiate in good faith any such request for an interpretation or
modification. City shall not unreasonably withhold its consent to any such requested
interpretation or modification provided such interpretation or modification is consistent with the
intent and purposes of this Agreement. Any person holding a mortgage, deed of trust or other
security instrument on all or any portion of the Property made in good faith and for value (each,
a “Mortgagee”), shall be entitled to the rights and privileges of this Article 14.
Section 14.02. Impairment of Mortgage or Deed of Trust. Except as otherwise
specifically stated in any security instrument held by a Mortgagee, no default under this
Development Agreement shall defeat, render invalid, diminish, or impair the lien of any
mortgage or deed of trust on the Property made, or other interest in the Property acquired, by any
Mortgagee in good faith and for value.
Section 14.03. Notice of Default to Mortgagee. If a Mortgagee has submitted to the City
a written request for notice as specified herein, City shall exercise its best efforts to provide to
such Mortgagee written notification of any failure or default by Developer in the performance of
Developer’s Obligations concurrently with the written notice provided to Developer. If the City
fails to deliver written notification to any Mortgagee that has submitted a written request to City
as provided herein, then any period for such Mortgagee to remedy or cure any alleged failure or
default shall not commence until the City’s actual delivery of such written notification to such
Mortgagee.
Section 14.04. Right of Mortgagee to Cure. Any Mortgagee shall have the right, but not
the obligation, to cure any failure or default by Developer during the cure period allowed
Developer under this Agreement, plus an additional 60 days if, to cure such failure or default, the
Mortgagee must obtain possession of the property as by seeking appointment of a receiver or
other legal process. Any Mortgagee that undertakes to cure any such failure or default shall
provide written notice to City of that fact; provided that no initiation of any such efforts by a
Mortgagee shall obligate such Mortgagee to complete or succeed in any such curative efforts.
Section 14.05. Mortgagee Liability for Past Defaults or Obligations. Except as otherwise
specifically provided in this Article 14, any Mortgagee, including a successful bidder at a
foreclosure sale, who comes into possession of the Property or any part thereof, shall take such
property subject to the Rights and Obligations of this Development Agreement and in no event
shall any such property be released from any Obligations. Nothing in this Article 14 shall prevent
City from exercising any remedy it may have for a default under this Development Agreement;
provided, however, that in no event shall such Mortgagee be liable personally for any defaults or
monetary obligations of Developer arising before such Mortgagee acquires or possesses such
property.
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Section 14.06. Technical Amendments to this Article 14. City agrees to reasonably
consider and approve interpretations and/or technical amendments to the provisions of this
Agreement that are required by lenders for the acquisition and construction of the improvements
on the Property or any refinancing thereof and to otherwise cooperate in good faith to facilitate
Developer’s negotiations with lenders. The Parties acknowledge and agree that such technical
amendments shall be processed in accordance with Section 9.04 of this Development Agreement.
ARTICLE 15. GENERAL PROVISIONS
Section 15.01. Incorporation of Recitals. The Recitals set forth above are incorporated
herein as though set forth in full.
Section 15.02. Project is a Private Undertaking. The development Developer proposes to
undertake is a private development, and Developer shall exercise full dominion and control over
the Project subject only to Developer’s Obligations contained in this Agreement, the Approvals
and Applicable Law.
Section 15.03. Cooperation in the Event of Legal Challenge.
Section 15.03.1. In General. If any person not a Party to this Development
Agreement institutes any administrative, legal or equitable action or other proceeding
challenging the validity of any provision of this Agreement, any Approval or Subsequent
Approval, or the sufficiency of any review of this Development Agreement or any Approval or
Subsequent Approval under CEQA (each a “Third Party Challenge”), the Parties shall
promptly meet and confer as to the most appropriate response to such Third Party Challenge;
provided, however, that any such response shall be consistent with Sections 15.03.2 and 15.03.3
below.
Section 15.03.2. Tender to and Conduct of Defense by Developer. City shall
tender the complete defense of any Third Party Challenge to Developer, and upon acceptance of
such tender by Developer: (i) Developer shall indemnify City against any and all fees and costs
arising out of the defense of such Third Party Challenge and (ii) Developer shall control the
defense and/or settlement of such Third Party Challenge and may take any and all actions it
deems necessary and appropriate in its sole discretion in connection therewith; provided,
however, that Developer shall seek and secure City’s consent to any settlement of such Third
Party Challenge, which consent shall not unreasonably be withheld or delayed.
Section 15.03.3. Defense by City. If Developer should fail to accept City’s
tender of defense under Section 15.03.2 above, City shall defend such Third Party Challenge and
control the defense and/or settlement of such Third Party Challenge as City decides (in its sole
discretion), and City may take any and all actions it deems necessary and appropriate (in its sole
discretion) in connection therewith; provided, however, that City shall seek and secure
Developer’s consent to any settlement of such Third Party Challenge, which consent shall not
unreasonably be withheld or delayed. Developer shall indemnify City against any and all fees
and costs arising out of the City’s defense of such Third Party Challenge including the
reasonable value of the services of its City Attorney and outside counsel, if any. Notwithstanding
the foregoing, if Developer determines for any reason that it no longer intends to develop the
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Project, then it may deliver notice of such determination to City and shall not be liable for any
defense costs incurred by City more than 90 days following the delivery of such notice.
Section 15.04. Defense and Indemnity. Developer shall defend and indemnify City from
and against any and all damages, claims, costs and liabilities arising out of the personal injury or
death of any person, or damage to the property of any person, to the extent such damages,
claims, costs or liabilities result from the construction of the Project by Developer or by
Developer’s contractors, subcontractors, agents or employees, except to the extent caused by the
negligence or willful misconduct of City, or any of City’s officers, employees, contractors or
agents. Nothing in this Section 15.04 shall be construed to mean that Developer shall defend or
indemnify City from or against any damages, claims, costs or liabilities arising from, or alleged
to arise from, activities associated with the maintenance or repair by City or any other public
agency of improvements that have been offered for dedication and accepted by City or such
other public agency. City and Developer may from time to time enter into subdivision
improvement agreements, as authorized by the Subdivision Map Act, which agreements may
include defense and indemnity provisions different from those contained in this Section 15.04. If
any conflict appears between such provisions in any such subdivision improvement agreement
and the provisions set forth above, the provisions of such subdivision improvement agreement
shall prevail.
Section 15.05. Governing Law; Attorneys’ Fees. This Development Agreement shall be
construed and enforced in accordance with the laws of the State of California. Venue for any
dispute arising under this Development Agreement lies in the county of San Luis Obispo and
Developer hereby consents to personal jurisdiction there for that purpose. The Parties will
cooperate to facilitate venue for any Third Party Challenge described in Section 15.03 above in
San Luis Obispo County. Should any legal action be brought by either Party because of any
default under this Development Agreement, to enforce any provision of this Agreement, or to
obtain a declaration of rights hereunder, the prevailing Party shall be entitled to such reasonable
and actual attorneys’ fees, and costs as may be fixed by the Court. The standard of review for
determining whether a default has occurred under this Development Agreement shall be the
standard generally applicable to contractual obligations in California. The terms and provisions
of this Section 15.05 shall survive any termination of this Agreement.
Section 15.06. Force Majeure. Performance by any Party of its Obligations hereunder
shall be excused and the Term of and any dates under this Development Agreement shall be
extended day for day during any period of “Permitted Delay” as hereinafter defined. For
purposes hereof, Permitted Delay shall include delay beyond the reasonable control of the Party
claiming the delay (and despite the good faith efforts of such Party) including, but not limited to:
(i) acts of God; (ii) civil commotion; (iii) riots; (iv) strikes, picketing or other labor disputes; (v)
shortages of materials or supplies; (vi) damage to work in progress by reason of fire, floods,
earthquake or other casualties; (vii) failure, delay or inability of the other Party to act; (viii) as to
Developer only, the failure, delay or inability of City to provide adequate levels of public
services, facilities or infrastructure to the Property; (ix) as to City only, with respect to
completion of the Annual Review or to processing applications for Approvals, the failure, delay
or inability of Developer to provide adequate information or substantiation as reasonably
required to complete the Annual Review or process applications for Approvals; (x) restrictions
imposed or mandated by governmental entities other than the City, including without limitation,
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any development moratorium for any purpose; (xi) enactment of conflicting state or federal laws
or regulations, (xii) judicial decisions or similar legal incapacity to perform, and (xiii) litigation
brought by a third party attacking the validity of this Agreement. A party’s inability to make a
payment when due shall not be the basis of a Permitted Delay. Any Party claiming a Permitted
Delay shall notify the other Party (or Parties) in writing of such delay within 30 days after the
commencement of the delay, which notice (“Permitted Delay Notice”) shall include the
estimated length of the Permitted Delay. A Permitted Delay shall be deemed to occur for the
time set forth in the Permitted Delay Notice unless a Party receiving the Permitted Delay Notice
objects in writing within 10 days after receiving the Permitted Delay Notice. Upon such an
objection, the Parties shall meet and confer within 30 days after the date of the objection in a
good faith effort to resolve their disagreement as to the existence and length of the Permitted
Delay. If no mutually acceptable solution can be reached, either Party may take action as may be
permitted under Article 12 above.
Section 15.07. Waiver.
Section 15.07.1. Legal Rights. Developer acknowledges and agrees that the
terms and provisions of this Development Agreement specifically permit City in some instances
to impose requirements upon the Project that City would not otherwise be able to impose due to
a lack of nexus, rough proportionality, or reasonable relationship between the Project and such
requirement, or other reasons. To the extent any such requirement is imposed by City upon the
Project consistently with the terms and provisions of this Agreement, Developer waives any right
to challenge judicially the imposition of such requirement by City. Except as otherwise provided
in this Section 15.07.1, City shall comply with Applicable Law.
Section 15.07.2. Other Rights. While Section 15.07.1 prohibits Developer from
challenging judicially certain City requirements imposed consistently with this Agreement,
nothing in this Development Agreement shall be deemed to abrogate or limit, nor be deemed to
waive, any right of Developer (whether arising under the United States Constitution, the
California Constitution or otherwise) to request City to refrain from imposing upon Developer,
the Project or the Property any requirement that this Development Agreement permits City so to
impose or otherwise petition City with respect to any matter related to the Project or the
Property.
Section 15.08. Notices. Any notice or communication required hereunder between the
Parties shall be in writing, and may be delivered either personally, by facsimile (with original
forwarded promptly by regular U.S. Mail) or by Federal Express or other similar courier
promising overnight delivery. If personally delivered, a notice or communication shall be
deemed to be received when delivered to the Party to whom addressed. If delivered by facsimile
transmission, a notice or communication shall be deemed to be received upon receipt of the
entire document by the receiving Party’s facsimile machine. Notices transmitted by facsimile
after 5:00 p.m. on a business day or on a Saturday, Sunday or holiday shall be deemed to have
been received on the next business day. If delivered by Federal Express or similar courier, a
notice or communication shall be deemed to be received when delivered as shown on a receipt
issued by the courier. Such notices or communications shall be delivered to the Parties at their
addresses set forth below:
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071928\ 9447955 46
If to City to: City Manager
City of San Luis Obispo
990 Palm Street
San Luis Obispo, CA 93401
Telecopy/Facsimile: (209) 941-7449
With a courtesy copy to: City Attorney
City of San Luis Obispo
990 Palm Street
San Luis Obispo, CA 95330
If to Developer to: MI San Luis Ranch, LLC
C/O Coastal Community Builders, Inc.
330 James Way, Suite 270
Pismo Beach, CA 93449
Attn: Gary Grossman
With courtesy copies to: Cox, Castle & Nicholson LLP
2029 Century Park East, Suite 2100
Los Angeles, CA 90067
Attn: Andrew K. Fogg, Esq. or Ronald I. Silverman, Esq.
and
Spierer, Woodward, Corbalis & Goldberg
707 Torrance Blvd, Suite 200
Redondo Beach, CA 90277
Attn: Steven F. Spierer, Esq.
Any Party may at any time, change its address or facsimile number for notice by giving 10 days’
written notice to the other in accordance with this Section 15.08.
Section 15.09. No Joint Venture or Partnership. Nothing in this Development Agreement
or in any document executed in connection with it shall be construed as creating a joint venture,
partnership or any agency relationship between City and Developer. City shall have no
responsibility for public improvements unless and until they are accepted by City in the manner
required by law.
Section 15.10. Severability. If any provision of this Development Agreement is held
invalid, void or unenforceable but the remainder of this Development Agreement can be
enforced without failure of material consideration to any Party, then the remainder of this
Development Agreement shall not be affected and shall remain in full force and effect, unless
amended by mutual consent of the Parties. Notwithstanding the foregoing, if any material
provision of this Development Agreement, or the application of such provision to a particular
situation, is held to be invalid, void or unenforceable, Developer (in its sole and absolute
discretion) may terminate this Development Agreement by providing written notice of such
termination to City.
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Section 15.11. Estoppel Certificate. Any Party and any Mortgagee may, at any time, and
from time to time, deliver written notice to the other Party or Parties requesting such Party or
Parties to certify in writing that, to the knowledge of the certifying Party: (i) this Development
Agreement is in full force and effect and a binding obligation of the Parties; (ii) this
Development Agreement has not been amended or modified either orally or in writing, but if so
amended or modified, identifying those amendments and modifications; and (iii) as of the date of
the most recent Annual Review, the requesting Party (or any Party specified by a Mortgagee) is
not in default in the performance of its Obligations under this Development Agreement, or if in
default, describing the nature and amount or extent of any such defaults. A Party receiving a
request hereunder shall execute and return such certificate or give a written, detailed response
explaining why it will not do so within 30 days of receipt of a request. Each Party acknowledges
that such a certificate may be relied upon by third parties acting in good faith. A certificate
provided by City establishing the status of this Development Agreement shall be in recordable
form and may be recorded at the expense of the recording Party.
Section 15.12. Further Assurances. Each Party shall execute and deliver to the other
Party or Parties all such other further instruments and documents and take all such further actions
as may be reasonably necessary to carry out this Development Agreement and the Approvals and
to provide and secure to the other Party or Parties the full and complete enjoyment of its Rights
hereunder.
Section 15.13. Construction.
(a) All Parties have been represented by counsel in the preparation of this
Development Agreement and no presumption or rule that ambiguity shall be
construed against a drafting party shall apply to its interpretation or enforcement.
Captions of sections and subsections are provided for convenience only and shall
not be deemed to limit, amend, or affect the meaning of the provisions to which
they pertain. If any conflict appears between this Development Agreement and the
rules, regulations or official policies of City, the provisions of this Development
Agreement shall prevail and be deemed to have amended any such conflicting
rules, regulation or official policy as of the Vesting Date to the extent permitted
by Applicable Law. In the event of a direct conflict between any provision of this
Development Agreement and any of the Project Approvals, the provisions of this
Development Agreement shall control.
(b) The Parties intend this Development Agreement to be consistent with the
requirements of Chapter 17.94 of the City’s Zoning Ordinance and it shall be
construed consistently with that intent. Should any conflict arise between this
Development Agreement and Chapter 17.94 as it exists on the Vesting Date, this
Development Agreement shall control.
Section 15.14. Other Miscellaneous Terms. In construing this Agreement, the singular
includes the plural; the masculine gender includes the feminine and the neuter; “shall” is
mandatory and “may” is permissive.
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Section 15.15. Counterpart Execution. This Development Agreement may be executed
in any number of counterparts and shall be deemed duly executed when each of the Parties has
executed such a counterpart.
Section 15.16. Time. Time is of the essence of each and every provision of this
Development Agreement.
Section 15.17. Good Faith/Fair Dealing. The Parties agree that a covenant of good faith
and fair dealing shall apply to all actions of the Parties. As used herein, this covenant shall mean
that the Parties shall act reasonably, and no Party shall do anything which shall have the effect of
destroying or injuring the rights of any other Party to receive the benefit of its bargain in this
Development Agreement. Nothing in this Section 15.17 shall detract from the principle of
Section 12.05 that neither Party shall be entitled to monetary damages for breach of this
Development Agreement.
Section 15.18. List of Exhibits:
A – San Luis Ranch Specific Plan Site Plan/Depiction of Property
B – Legal Description of Property
C – Financing Plan
D – Feasibility Memorandum
E – Agricultural Land Operations & Guidelines
F – Affordable/Workforce Housing Plan
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IN WITNESS WHEREOF, the Parties have executed this Development Agreement as of
the Execution Date above.
CITY:
CITY OF SAN LUIS OBISPO,
a municipal corporation
By:
___________________________________
Heidi Harmon, Mayor
APPROVED AS TO FORM:
By:
___________________________________
J. Christine Dietrick, City Attorney
(signatures continued on next page)
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071928\ 9447955 50
DEVELOPER:
MI SAN LUIS RANCH, LLC,
a Delaware limited liability company
By: MI ENTITLEMENT IV, LLC
a Delaware limited liability company
Its: Manager
By: Presidio Merced Land IV Passive, LLC
a Delaware limited liability company
Its: Co-Manager
By:
___________________________________
Michael Sullivan
Its: Authorized Representative
By: GGCCB, LLC
a California limited liability company
Its: Co-Manager
By:
___________________________________
Gary Grossman
Its: Managing Member
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071928\ 9447955 Notary - 1
STATE OF CALIFORNIA )
) ss:
COUNTY OF )
On ______________, 2018 before me, _____________________________________________
Notary Public (insert name and title of the officer),
personally appeared , who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature: _______________________________________
[Seal]
A notary public or other officer
completing this certificate verifies only
the identity of the individual who signed
the document to which this certificate is
attached, and not the truthfulness,
accuracy, or validity of that document.
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071928\ 9447955 Notary - 2
STATE OF CALIFORNIA )
) ss:
COUNTY OF )
On ______________, 2018 before me, _____________________________________________
Notary Public (insert name and title of the officer),
personally appeared , who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature: _______________________________________
[Seal]
A notary public or other officer
completing this certificate verifies only
the identity of the individual who signed
the document to which this certificate is
attached, and not the truthfulness,
accuracy, or validity of that document.
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071928\ 9447955 Notary - 3
STATE OF CALIFORNIA )
) ss:
COUNTY OF )
On ______________, 2018 before me, _____________________________________________
Notary Public (insert name and title of the officer),
personally appeared , who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature: _______________________________________
[Seal]
A notary public or other officer
completing this certificate verifies only
the identity of the individual who signed
the document to which this certificate is
attached, and not the truthfulness,
accuracy, or validity of that document.
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071928\ 9447955 Exhibit A-1
EXHIBIT A
SAN LUIS RANCH SPECIFIC PLAN SITE PLAN
(attached)
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071928\ 9447955 Exhibit B-1
EXHIBIT B
LEGAL DESCRIPTION
(attached)
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Page 1 of 2
EXHIBIT B
ANNEXATION No. ??
To the City of San Luis Obispo,
County of San Luis Obispo, State of California
A portion of Lot 64 and 65 of the Subdivision of the Rancho Canada de Los Osos and La Laguna, as filed in Book A,
at Page 83 and 84 of Maps, and Lot L and a portion of Lots K, M, and N of the Re-subdivision of Lots 58, 61, 62, 63,
64 and 65, per J. Stratton’s Survey and Map of the Subdivisions of the Rancho Canada de Los Osos and La Laguna,
as filed in Book A, at Page 161 of Maps in the office of the Recorder, San Luis Obispo County, California, more
particularly described as follows:
Commencing at the most Northerly corner of Lot K (Corner “EE”) as shown on said map filed in Book A, at Page 161
of Maps, being on the existing City Limit boundary of the City of San Luis Obispo at the Northern terminus of
course No. 62 of the “Los Osos Road No. 1 Annexation” as approved by Resolution No. 1728 of the legislative body
of said City, and being on the Southeasterly line of Madonna Road right-of-way, known formerly French Road;
Thence, leaving said Road, along the Southwesterly line of said Lot J as shown on said map filed in Book A, at Page
161 of Maps, and along the existing City Limit boundary of said Los Osos Road No. 1 Annexation, South 45° 36’ 37”
East, 393.00 feet to the True Point of Beginning;
1. Thence, continue along the Southwesterly line of said Lot J, and along the existing City Limit boundary of
said Los Osos Road No. 1 Annexation, South 45° 36’ 37” East, 1088.13 feet;
2. Thence, along the Southeasterly line of said Lot J, North 42° 52’ 03” East, 145.28 feet;
3. Thence, along the Southwesterly line of Lot I as shown on said map filed in Book A, at Page 161 of Maps,
South 54° 08’ 17” East, 558.56 feet to the Westerly boundary of the State Highway 101 right-of-way;
4. Thence, continue along the existing boundary of said Los Osos Road No. 1 Annexation, Southerly, and
along the Westerly boundary of State Highway 101 right-of-way on a curve that is concave to the West
from a radial bearing North 62° 47’ 19” West, with a radius of 2420.00 feet, through a central angle of 00°
33’ 58”, an arc length of 23.91 feet;
5. Thence, continue along the Westerly boundary of State Highway 101 right-of-way, and along the existing
boundary of said Los Osos Road No. 1 Annexation, South 27° 46’ 39” East, 2557.88 feet to the
Northeasterly boundary of Lot “EE” as designated according to said map filed in Book A, at Page 161 of
Maps;
6. Thence, leaving the Westerly boundary of State Highway 101 right-of-way, along the Northeasterly
boundary of said Lot EE, being the existing City Limit boundary of Annexation No. 71 as approved by
Resolution No. 2005-09 of the legislative body of said City, North 54° 25’ 52” West, 1349.74 feet;
7. Thence, continue along the Northeasterly boundary of said Lot “EE”, and along the existing City Limit
boundary of said Annexation No. 71, North 53° 35’ 32” West, 733.70 feet to the most Northerly corner of
said Lot EE, being the Northeast corner of Lot O (corner “AE”) as designated according to said map filed in
Book A, at Page 161 of Maps, and being the most Eastern corner of the existing City Limit boundary of the
“Lakewood Addition” as approved by Resolution No. 924 of the legislative body of said City;
8. Thence, along the Northeasterly line of said Lot O, and along the existing City Limit boundary of said
“Lakewood Addition”, North 35° 34’ 51” West, 41.45 feet to the most Southern corner of Tract No. 169 as
filed in Book 6, at Page 45 of Maps in the office of the Recorder for said County, and the most Southern
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Page 2 of 2
corner of the existing City Limit boundary of the “Johnson Annexation” as approved by Resolution No. 627
of the legislative body of said City;
9. Thence, leaving said Northeasterly line of Lot O, along the Easterly line of said Tract No.169, and along the
existing City Limit boundary of said “Johnson Annexation”, North 8° 50’ 11” East, 116.07 feet;
10. Thence, continue along the Easterly line of said Tract No.169, and along the existing City Limit boundary of
said “Johnson Annexation”, North 0° 24’ 24” East, 154.15 feet;
11. Thence, North 11° 04’ 38” East, 128.26 feet;
12. Thence, North 15° 46’ 21” East, 267.07 feet;
13. Thence, North 5° 15’ 56” East, 228.66 feet;
14. Thence, North 12° 39’ 30” East, 101.44 feet;
15. Thence, North 18° 07’ 07” East, 207.14 feet;
16. Thence, North 1° 51’ 40” East, 100.02 feet;
17. Thence, North 18° 32’ 56” West, 215.02 feet;
18. Thence, North 4° 24’ 05” West, 201.66 feet;
19. Thence, North 13° 15’ 08” West, 71.55 feet to the Southerly line of the Madonna Road right-of-way,
known formerly as French Road;
20. Thence, along the Southerly line of said Madonna Road right-of-way, along the existing City Limit
boundary of said “Johnson Annexation”, and along the existing City Limit boundary of “Parcel E-1” of the
Annexation of Territory to the City of San Luis Obispo, as approved by Resolution No. 81-41 of the
legislative body of said City, North 63° 34’ 05” East, 817.33 feet to the most Western corner of that parcel
of land designated Parcel 1 in the Correction Deed as conveyed to United States Postal Service by Grand
Deed filed in Book 2332, at Page 318 of Official Records in the office of the Recorder for said County;
21. Thence, along the Southwesterly boundary of said parcel of land conveyed to United States Postal Service,
and along the existing City Limit boundary of “Parcel E-1” and “Parcel E-2” of said Annexation of Territory
to the City of San Luis Obispo, as approved by Resolution No. 81-41, South 38° 48’ 08” East, 464.31 feet;
22. Thence, continue along the existing City Limit boundary of “Parcel E-1” and “Parcel E-2” of said
Annexation of Territory to the City of San Luis Obispo, and along the Southeasterly line of said parcel of
land conveyed to United States Postal Service, North 47° 13’ 35” East, 475.60 feet to the point of
beginning;
Containing 131.38 acres more or less.
Prepared by: ___________________________________
Dan Hutchinson, LS 5139
Dated: ____________________________
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071928\ 9447955 Exhibit C-1
EXHIBIT C
FINANCING PLAN
(attached)
Packet Page 112
Report
San Luis Ranch Financing Plan
Prepared for:
City of San Luis Obispo
Prepared by:
Economic & Planning Systems, Inc.
May 31, 2018
EPS #161142
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Table of Contents
1.EXECUTIVE SUMMARY ............................................................................................ 1
2.SAN LUIS RANCH PROJECT OVERVIEW ......................................................................... 4
San Luis Ranch Specific Plan ...................................................................................... 4
3.INFRASTRUCTURE IMPROVEMENTS TO BE FUNDED ............................................................ 7
4.FUNDING AND FINANCING SOURCES .......................................................................... 11
San Luis Ranch Funding Sources ............................................................................... 11
City Funding Sources ............................................................................................... 12
Funding Strategy for Regional Improvements ............................................................. 12
Economic Considerations ......................................................................................... 15
5.IMPLEMENTATION MEASURES AND RELATED ACTIONS ...................................................... 17
List of Tables
Table 1 San Luis Ranch Infrastructure Financing Plan Summary ......................................... 3
Table 2 San Luis Ranch Specific Plan Residential Use Summary .......................................... 5
Table 3 San Luis Ranch Regional Improvement Cost Allocation ........................................... 9
Table 4 San Luis Ranch Proposed Community Benefits Program Developers Proposal .......... 10
Table 5 Funding Sources for Regional Improvements ...................................................... 13
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1
1.EXECUTIVE SUMMARY
The San Luis Ranch Financing Plan (Financing Plan) identifies the services and infrastructure
improvements required to serve the San Luis Ranch Project and describes how these items will
be funded and/or financed over time. The Financing Plan conforms with the San Luis Ranch
Specific Plan, Subdivision Map, and financial terms included in the San Luis Ranch Development
Agreement and provides implementing actions for the major funding sources identified.
Upon annexation to the City, the San Luis Ranch Project, which consists of 131.4 acres, will
create a new neighborhood located west of Highway 101 in the southwest quadrant of the City.
The San Luis Ranch Specific Plan allows up to 580 dwelling units and commercial development
including a 200-room hotel, 100,000 square feet of office space, and 150,000 square feet of
retail and service commercial space. The Project also includes 7.8 acres of parks, waterways, and
other interior open space, as well as 52.3 acres of farmed agricultural land.
The Financing Plan addresses how the infrastructure and services needed to serve the San Luis
Ranch Project will be funded, as the new neighborhood is constructed and occupied by new
residents and businesses:
Municipal services include “Citywide” services within the Project area. The Citywide services
will be fully funded by municipal revenues derived from the Project area assuming that the
proposed commercial development occurs.1 Prior to occupancy of the commercial
development, a fiscal mitigation payment is stipulated by the terms of the Development
Agreement.
Infrastructure needed for the San Luis Ranch Project includes contributions to Citywide and
other subarea development impact fee programs, mitigating impacts upon regional (off-site)
infrastructure, and funding “backbone” and subdivision-related improvements within the
Project area. The largest cost infrastructure item is the Project’s “fair share” of the proposed
Prado Road/Highway 101 Interchange.
Funding for required infrastructure improvements will be derived from a variety of sources
including developer equity investments to build or contribute to building needed infrastructure
improvements. Table 1 presents an overall financing strategy for the San Luis Ranch Project.
Developer equity will be a key source of overall infrastructure funding. It is estimated that the
developer will invest an estimated $22.8 million in project-related infrastructure, including
paying the City’s development impact fees as specified in the Development Agreement. Some of
the developer’s equity investment in City or Region-Serving Infrastructure will be offset by
credits or reimbursement from the City’s development impact fee programs or private
reimbursement from other benefitting properties because the developer is “oversizing” the
improvement relative to its nexus-based “fair share” costs, correcting existing deficiencies, or
advancing the improvement before its actual need. At the same time, major improvements
required also benefit other development, the City as a whole, or the region.
1 San Luis Ranch Fiscal Analysis, ADE, September 11, 2017.
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San Luis Ranch Financing Plan
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2
The City’s, other development’s, and the region’s share of City or region-serving infrastructure in
the vicinity of the Project will be funded by the City’s development impact fee programs (levied
on other development in the City), exactions on other developers, and a range of other City and
regional funding grant sources.
This Financing Plan provides details regarding funding of each of the major infrastructure types
listed in Table 1. This information, in turn, requires a series of implementation actions needed to
secure the funding for fulfilling the requirements of the related entitlement documents including
the Specific Plan, the Project Environmental Impact Report, the Fiscal Impact Report, the Vesting
Tentative Subdivision Map, and the Development Agreement. The preparation of the Financing
Plan occurred through a cooperative effort between the Developer and its team of advisors and
City staff and their consultants and advisors.
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San Luis Ranch Financing Plan Report 5/31/18 3 Table 1 San Luis Ranch Infrastructure Financing Plan Summary TypeDescriptionDeveloper or Builder EquityDeveloper Equity Subject to Credits or ReimbursementCommunity Facilities District Special TaxesCity SourcesRegional, State, and Federal SourcesIn‐tract InfrastructureDeveloper builds neighborhood streets and facilities shown in Subdivision MapYesNoneNoneNoneNoneBackbone Infrastructure and CEQA Mitigations and other CostsDeveloper builds major infrastructure serving Specific Plan Area shown in Subdivision MapYesYes, for qualifying infrastructure items only (items listed in DIF programs and other items deemed eligible by City)NoneNoneNoneRegional Infrastructure, Developer "Fair Share"Nexus‐based share of major infrastructure (EIR Mitigation, etc.)Yes, "fair share" allocationYes, for oversizing of improvements beyond "fair share" allocationYesNoneNone, but available allocations beyond regional share will decrease funding needs from other sources proportionallyRegional Infrastructure, City/Region Share of Infrastructure CostsImprovements required for Project but benefitting other parts of City and regionNoneReimbursement or credit for oversizing infrastructure / funding beyond requirementNoneYes, City may apply "property tax increment" funding proportional to special increment received from CountyYes, for City/Regional share of infrastructure costs not funded by impact fee programsCommunity Benefits Offered by DeveloperDevelopment Agreement requires an offering of Community Benefits Commensurate with value of Development AgreementYes, funding above "fair share" for regional infrastructure considered as "community benefit"NoneNoneNoneNoneFiscal Shortfalls and Facility Operating GuaranteesFiscal Analysis shows deficits until commercial development occurs. Operating cost for farm, etc.Yes, as needed to assure City's positive fiscal (operating cost) balance (proposed $262 per unit "Early Residential Development Fee" based on Fiscal Analysis until commercial occupancy). Additional bond offered for 1.5x projected fiscal deficit for each year.NoneYes, but only as tertiary backstop for positive fiscal impact beyond Fee and 1.5x BondNoneNoneCitywide or Areawide Development Impact Fee Program Infrastructure ImprovementsDevelopment Impact Fees cover new development's "fair share" of new infrastructure, paid when building permits issued Negotiated combination of fees vested at Tentative Tract Map and then‐current fees adopted by City.Fee credits for building infrastructure up to "fair share", reimbursement or credit for beyond "fair share" NoneYes, as may be specified in the Impact Fee Program to keep fees within reasonable economic limitsYes, for portion of infrastructure cost not "fair share" linked to new development onlyInfrastructure ItemFunding Source CategoryPacket Page 117
4
2.SAN LUIS RANCH PROJECT OVERVIEW
The San Luis Ranch Project is the development of a major new City neighborhood. The project
includes a mix of residential, commercial, and office uses while preserving nearly half of the site
as open space and agriculture on a 131.4-acre property, as described in the San Luis Ranch
Specific Plan. The Project site is located west of U.S. Highway 101, east of Madonna Road, and
south of Dalidio Drive in the southwestern part of the City. The property includes a single parcel
(APN 067-121-022).
The Specific Plan area would require annexation to the City of San Luis Obispo. The project is
within the City’s Sphere of Influence and Urban Reserve Line and is designed to be consistent
with both City and Local Agency Formation Commission (LAFCo) policies, including the
requirement that the annexation be compatible with the City’s General Plan and supportable by
the City’s infrastructure. The intent is for the project to be consistent with the development
parameters described in the City’s 2014 Land Use Element.
Following annexation of the area and development, the San Luis Ranch Project will create a new
neighborhood along the southern border of the City. Development will be regulated by various
controlling documents including the Development Agreement and the San Luis Ranch Specific
Plan and Vesting Tentative Map adopted by the City in July of 2017.
San Luis Ranch Specific Plan
The San Luis Ranch Specific Plan (Specific Plan) allows up to 580 dwelling units; a commercial
area with up to 250,000 square feet of neighborhood-serving retail and office uses; a 200-room
hotel, 7.8 acres of internal open space; and 52.3 acres of permanently protected farmed
agricultural land. The Project includes an Agricultural Heritage Facilities and Learning Center
which will serve as an agri-tourism destination with seasonal attractions and promote the
region’s agricultural history. Uses allowed in the open space and agricultural areas include
educational uses, urban agriculture, crop production, agricultural accessory uses, produce
stands, and temporary events. These features are described in the Specific Plan text and its
appendices.
The Specific Plan is organized around the principles of 1) maintaining and promoting San Luis
Obispo’s agricultural heritage; 2) providing open space and recreational areas; 3) delivering
diverse housing opportunities, including workforce housing; and 4) creating a multimodal
community. There are several key infrastructure improvements specified in the Specific Plan,
including the Prado Road/Highway 101 Interchange, Froom Ranch Way, Dalidio Road
Improvements, Madonna Road Improvements, and related multimodal improvements, consistent
with the City’s Circulation Element and Bicycle Transportation Plan.
Residential Uses
The Specific Plan includes up to 580 residential units of varied density and type, including single
family attached and detached housing on a range of lot sizes and multifamily housing, as shown
on Table 2. Residential uses are generally to be located on the western portion of the San Luis
Ranch Specific Plan Area, west of Froom Ranch Way and south of Dalidio Drive. Residential land
uses will be accessible from local streets, with connections to Froom Ranch Way, Madonna, and
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5
Prado roads. The single-family units are proposed to consist of a mix of traditional lot layouts
and small lot layouts with front- and alley-loaded garages. The multifamily units are proposed to
be compact homes, which will be located at the northwest portion of San Luis Ranch, effectively
transitioning between the existing neighborhood to the west, and Madonna Road to the North.
There also will be multifamily flats in buildings of 12 units or larger. These units will be designed
as townhouses or apartments with up to 4 bedrooms per unit.
The affordable housing located within the San Luis Ranch Specific Plan Area will provide 34 units
on site for Very Low, Low-, and Moderate-income households, and fourteen additional units
affordable to workforce households (121-160 percent of Area Median Income).
Table 2 San Luis Ranch Specific Plan Residential Use Summary
Neighborhood Commercial Uses
The commercial area of the San Luis Ranch will allow for up to 100,000 square feet office
buildings and 150,000 square feet of retail and service business buildings focused on Prado
Road. The commercial-retail center will offer a variety of uses that will both provide for the needs
of the residential neighborhood in San Luis Ranch, as well as complement the overall retail
offerings within the City. Allowed commercial uses include retail, services, restaurants, office,
and hotel. It is anticipated that the planned 200-room hotel could include conference facilities,
meeting space, and restaurants.
Commercial areas will be accessible by automobiles, transit riders, pedestrians, and bicyclists.
Regional transit services will connect residents and visitors throughout the area.
Open Space Uses
With half of the site set aside for agriculture, open space, and parks, San Luis Ranch takes an
integrated, comprehensive approach to planning and managing open and recreational spaces.
The San Luis Ranch Specific Plan enhances the City’s open space by introducing new amenities,
including adding a key link in the Bob Jones Trail and active linear parks.
Residential Category Amount
Estimated
Assessed Value
per Unit
Low-Medium Density 192 $730,000
Medium Density 77 $520,000
High Density 277 $425,000
Affordable Housing 34 $142,200
Total Residential 580
Source: San Luis Ranch; ADE Fiscal, 9/11/2017.
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6
Parks and Recreation Uses
San Luis Ranch will provide park and open space amenities consistent with the values set forth in
the General Plan. Parklands will include an active linear park with a fitness loop and multi-use
trails, a central neighborhood park featuring both active and passive recreational opportunities,
and pocket parks interspersed throughout the residential areas to provide enhanced pedestrian
connectivity and visual openness.
Pocket parks provided throughout the San Luis Ranch community will provide both recreational
and pedestrian amenities and open space breaks, allowing connectivity between residential areas
and creating a more open feel to the neighborhood. A key linear park element of the Specific
Plan will be the San Luis Ranch Preserve and Trailhead that will link the Bob Jones Trail and
connect the linear park behind Target to Laguna Lake.
Agricultural Preservation
The San Luis Ranch Specific Plan will preserve a significant piece of San Luis Obispo agriculture
as well as integrate the site’s historical agriculture into the community, with farm operations to
be provided by a private lease agreement. The agricultural land will be contiguous with the
adjacent San Luis Obispo City Farm to allow for integration and will include the community
learning center. The Agricultural Heritage Facilities and Learning Center will be a destination for
residents and tourists alike and will provide the community with local food, education, and a
connection to agriculture.
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3.INFRASTRUCTURE IMPROVEMENTS TO BE FUNDED
The San Luis Ranch Project, as a largely undeveloped area, will require the full complement of
local infrastructure to serve the Project area including streets and in-street utilities, drainage,
parks and trails and bikeways. Infrastructure and municipal facilities required to serve the
Project include “backbone” and “in-tract” infrastructure as well as “City-serving and region-
serving” infrastructure, which is typically located beyond the Project boundary but is required (at
least in part) to accommodate the Project development.
In-Tract Infrastructure
“In-tract” improvements typically include the neighborhood streets and utilities serving the
developed portions of development. These improvements will be installed by the developer or
subsequent builders at their expense in conformance with the Subdivision Map requirements and
dedicated to the City in the typical fashion.
Backbone Infrastructure
“Backbone” infrastructure improvements include collector and arterial streets, major wet-utility
improvements, and other public facilities such as parks that service the entire Project area or
beyond. San Luis Ranch backbone infrastructure will be built by the developer at their expense
and dedicated to the City. Insofar as these individual backbone improvements have been
identified in City master facility plans or development impact fee programs the developer may
qualify for fee credits or reimbursement.
Citywide or Region-Serving Infrastructure
A significant investment in region-serving transportation and other infrastructure improvements
is required to provide adequate transportation capacity for San Luis Ranch, reduce existing
congestion, and provide capacity for other pending nearby development projects as well as the
remaining development potential in the City broadly. As a part of the broader environmental
impact and traffic analysis for the San Luis Ranch Project the City has identified approximately
$54.2 million of improvements. Table 3 provides a listing of these improvements and shows a
technically-derived cost allocation for each infrastructure item, as summarized below:
San Luis Ranch cost allocation. Approximately $22.8 million of these costs are attributable to
the San Luis Ranch Project based upon the City’s “fair share” cost allocation and/or other
agreements.
City/regional share cost allocation. This leaves a net amount to be funded of $31.4 million.
Funding sources to fund this “net” cost are discussed below.
San Luis Ranch “up-front” costs. Approximately $25.5 million in up-front costs are required
by San Luis Ranch to build or participate in project specific infrastructure.
Community Benefits
As a part of adopting a Development Agreement, the City is obligated to identify “community
benefits” that are offered by the developer as consideration for the City’s willingness to enter
into the Development Agreement. Community benefits, in this context, are “extraordinary,”
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meaning they are items that exceed the general nexus-based benefits of the project (e.g., net-
positive fiscal flows, economic development benefits, and achieving other General Plan policies)
and items that are required by City policy or regulations or EIR mitigations. At the minimum, the
dollar value of these extraordinary community benefits should exceed the estimated nexus-based
value of the Development Agreement to the developer, including the value of vesting the
entitlements, offering to provide financing mechanisms, and other financial considerations. The
City and the San Luis Ranch Developer have discussed a program of extraordinary community
benefits summarized on Table 4 that sums to $14.25 million. Analysis has shown that this
amount exceeds the value of the Development Agreement to the developer.
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Table 3 San Luis Ranch Regional Improvement Cost Allocation
Percent Amount Percent Amount
ROADWAYS
1 Froom Ranch Way (Prado to Oceanaire) Including Bridge Build & Fund $7,071,277 100% $7,071,277 0% $0
2 Froom Ranch Way (Oceanaire to Target Driveway) Design & Pay Fees - Built By Others $423,561 15% $63,534 85% $360,027
3 Froom Ranch Way & LOVR Intersection Widening
Build w/ Potential Private
Reimbursement $450,000 20% $90,000 80% $360,000
4 Prado Road/US 101 Interchange and North Bound Ramps
Financing of Project improvements; Net
Fees - Built By City $25,000,000 28% $7,000,000 72% $18,000,000
5 Prado Road Southbound Ramps Pay Fees - Built By Others $10,000,000 28% $2,800,000 72% $7,200,000
6 Madonna & Dalidio/Prado Intersection Widening Build & Fund $2,000,000 100% $2,000,000 0%$0
OTHER AREA ROADWAYS (MITIGATIONS)
7 Madonna & SB 101 Off Ramp - Lengthen EB Left Turn Pocket Build & Fund $50,000 100% $50,000 0%$0
8 Madonna & Oceanaire Pedestrian X-ing Enhancements Build & Fund $300,000 50% $150,000 50% $150,000
9 Madonna & San Luis Ranch Way Pedestrian X-ing Enhancement Build & Fund $150,000 100% $150,000 0%$0
10 LOVR & SB 101 Off Ramp - Lengthen Left Turn Pocket Build & Fund $250,000 100% $250,000 0%$0
11 LOVR & Higuera - Lengthen EB Right Turn Pocket Build & Fund $25,000 100% $25,000 0%$0
12 Higuera & South - Lengthen NB Right Turn Pocket
Build w/ Potential Private
Reimbursement $250,000 50% $125,000 50% $125,000
OTHER AREA ROADWAY MITIGATIONS - FEE ONLY PROJECTS
13 Prado & Higuera Widening Pay Fees - Built By Others $750,000 10% $75,000 90% $675,000
14 Madonna Rd @ LOVR - Signal Timing Optimization Pay Fees - Built By Others $2,500 0%$0 100% $2,500
15 Madonna & Oceanaire Turn Lane Extensions Pay Fees - Built By Others $25,000 100% $25,000 0%$0
16 Madonna & LOVR - Turn Lane Extensions Pay Fees - Built By Others $25,000 100% $25,000 0%$0
17 LOVR & Auto Park Way Signalization Pay Fees - Built By Others $200,000 11% $22,000 89% $178,000
18 Higuera & Tank Farm - Lengthen NB Right Turn Pocket Pay Fees - Built By Others $850,000 5% $42,500 95% $807,500
SLR BIKEWAYS
19 Prado Road Class I Path (Madonna to Froom)Build & Fund $1,500,000 100% $1,500,000 0%$0
20 Madonna Road Class I Path / Protected bikeway
(Hwy 101 to Oceanaire)Build & Fund $800,000 60% $480,000 40% $320,000
21 Bob Jones Trail (Calle Joaquin to Froom Ranch Road)
Build w/ Potential Private
Reimbursement $1,000,000 16% $160,000 84% $840,000
SLR BIKEWAYS - FEE ONLY PROJECTS
22 Prado Road Class I Path (NB Ramps to Higuera)Pay Fees - Built By Others $500,000 28% $140,000 72% $360,000
23 Bob Jones Trail (Madonna to Prado)Pay Fees - Built By Others $1,500,000 3% $45,000 97% $1,455,000
UTILITIES
24 Install new 24" HDPE Sewer Line
50% developer share for the sewer
system $1,078,700 50% $539,350 50% $539,350
Cost Totals $54,201,038 $22,828,661 $31,372,377
Source:City Staff Regional Infrastructure database dated October 9, 2017, with agreed-upon costs for the Prado Road/US 101 Interchange (Item #4) and the Bob Jones Trail (Item #21).
City/Regional ShareItem #Item Developer Role/Participation
Preliminary
Cost Total
Estimate
Cost Allocation
Developer Share
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San Luis Ranch Financing Plan Report 5/31/18 10 Table 4 San Luis Ranch Proposed Community Benefits Program Developers Proposal Dollar Value Beyond SLR's Fair Share1.0Land and Building Dedications1.1Agricultural Heritage and Learning Center - Building Costs (Net of Mitigation Requirements) $2,025,0002.0Multi-Modal Transportation 2.1Bike Share/Rental$290,0002.2Car Sharing/Park & Ride$290,0002.3Electric Car Charging Stations$240,0003.0Energy and Water Conservation Features3.1Solar PV [1]$3,204,5003.2Building Efficiency/Net Zero$725,0004.0Affordable and Workforce Housing Programs4.0Priority for SLO Residents, Workers (1.5% of Initial Sales Value) $4,468,8754.2Owner Occupancy Restriction on NG-10 and NG-23 Units (1.5% of Initial Sales Value)$2,703,0004.3Local Heroes Program - Minimum of $1,500 Incentive per Home (Assuming Approx. 200 Homes)$300,000$14,250,000[1]Sources: San Luis Ranch; City of San Luis Obispo; Kosmont Companies; Economic & Planning Systems, Inc.Extraordinary Community Benefit Items Offered by San Luis RanchTotal Extraordinary Community Benefits (Rounded)Total cost of Item 3.1 is $4,930,000. San Luis Ranch's fair share is 35%, or $1,725,500. The balance of $3,204,500 represents value to the City beyond San Luis Ranch's fair share. Packet Page 124
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4.FUNDING AND FINANCING SOURCES
San Luis Ranch Funding Sources
Developer or Builder Equity
Developer equity, including revenue from a Community Facilities District (CFD) bond issue, is
one of the primary sources of funding for infrastructure improvements needed to serve the San
Luis Ranch area. Developer (or builder) equity will pay City development impact and mitigation
fees, fund construction of all “in-tract” and “backbone” improvements located within the San Luis
Ranch area, fund the Project’s “fair share” allocation of off-site “regional” improvements, of
which some will be subject to fee credits, and advance funding over and above the “fair share”
costs, a portion of which will be subject to reimbursement by the City. It is estimated that total
developer equity necessary to fund the backbone and in-tract infrastructure and region-serving
infrastructure (including the amount beyond the nexus-based “fair share” amount) is $25.5
million.
Participation in Area and Citywide Development Impact Fee Programs
The San Luis Ranch Project will be subject to the City’s various development impact fee
programs, as specified in the Development Agreement. During 2017 and 2018 the City engaged
in a comprehensive effort to update and reorganize its impact fees. Per the Development
Agreement, the San Luis Ranch Project will pay transportation fees and water and wastewater
connection charges, as of the date of the Vesting Tentative Map (July 2017), except these fees
will escalate at 10 percent per year beginning one year after the annexation and recordation of
the first Final Map creating a developable residential (or commercial) lot until the fees reach the
maximum fees approved and adopted by the City Council as part of the 2017/2018 update.
The residential component of the San Luis Ranch Project will pay the fire and police fees as
approved and adopted by the City Council. The commercial component of the San Luis Ranch
Project will pay the fire and police as approved and adopted by the City Council, except these
fees will be phased in as described in the Development Agreement. Additional development
impact fees are charged by the local school district.
Construction and Dedication of “In-tract” Improvements
As is common practice, the developer of San Luis Ranch will build in-tract and backbone
infrastructure within, and on the periphery of, the San Luis Ranch area to the specification of the
City as documented in the Tentative Subdivision Map and subsequently dedicate these
improvements and underlying lands to the City.
“Fair Share” Allocation of Other Improvement Costs
The development of the San Luis Ranch Project will increase traffic on existing roadways and
create demand for other City/County infrastructure. Many of these improvements are facilities
located beyond the project boundary. This additional demand was studied in detail as part of the
Environmental Impact Report (EIR) and the mitigation measures identified to maintain policy-
based levels of service on these facilities.
One of the most significant improvements is the construction of an overcrossing from the San
Luis Ranch site across U.S. Highway 101 via an overpass that will connect to the existing section
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of Prado Road on the east side of the freeway. This overpass will serve the expanded commercial
and residential development of San Luis Ranch and will provide an additional east/west
connection in San Luis Obispo that would reduce congestion at the Los Osos Valley Road and
Madonna Road interchanges and route traffic to and from the Airport Area via the Prado Road
connection. The overpass will also have a Class I Bike path, on-street bike lanes, and sidewalks.
This improvement is to be constructed as a separate project from the Specific Plan as it is
developed, and the Specific Plan would pay a fair share contribution to the design and
construction. Consequently, the project will construct improvements that are necessary to
correct existing deficiencies and to accommodate traffic and other impacts above and beyond its
own impacts.
Community Facilities District
The owners of the property have requested and the City has agreed to form a CFD subject to
Council action for the San Luis Ranch area. Such a CFD, pursuant to the Community Facilities
District Act of 1982, allows for the levy of a special tax on real property located within the
designated boundary of the CFD for a range of purposes including providing funding for
municipal services, local area maintenance, and infrastructure. It is common for the special taxes
to be used to service municipal bonds issued for the CFD to fund new development-related
infrastructure. The San Luis Ranch CFD will primarily be used as a source of funding for the
Prado Road/Highway 101 Interchange improvements and either directly fund or reimburse
developer funding of regional improvements.
City Funding Sources
Development Impact Fee or Exaction Revenue
Insofar as other developers/builders are obligated to pay their “fair share” of infrastructure
improvements by paying the Citywide and area development impact fees or additional nexus-
based “exactions,” a portion of this revenue will be used for reimbursement for investments
above “fair share” made by the San Luis Ranch developer (or other nearby developers that may
advance funding for construction of fee-funded facilities and improvements).
Other Funding Sources
Funding for the City’s share of non–San Luis Ranch improvement costs may be derived from a
variety of sources typically used by the City to fund infrastructure. These include private funding
from other development, public grants and use of eligible and available impact fee revenue.
Funding Strategy for Regional Improvements
A key aspect of the San Luis Ranch Financing Plan is providing funding for a range of
improvements required for its development but also needed to meet needs of other nearby
development and development throughout the City and region. Overall, these improvements are
estimated to cost $54.2 million. As shown in Table 3, above, these costs are dominated by the
Prado Road/US 101 Interchange. Table 3 also shows the cost allocation to the San Luis Ranch
developer and the remainder that is the share that must be funded by the City or others. A key
consideration regarding these improvements is their phasing and linkage, (i.e., when the
individual improvements need to be constructed as new development occurs). At the present
time it is expected that the improvements will need to be constructed over the next 10 years or
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more, depending on the rate of actual development and other factors. Table 5 shows the
sources of funding that the developer will rely upon to pay for San Luis Ranch’s cost allocation,
as further described below.
Table 5 Funding Sources for Regional Improvements
Phasing of Regional Improvements
The Regional Improvements will be phased in a manner that meets increasing travel demand and
also the availability of necessary funding from development-based or City sources.
Up-front Developer Obligation
The Developer’s up-front obligation to build improvements and/or pay fees, before accounting for
credits/reimbursements or other adjustments, is estimated to be $25.5 million. This is above and
beyond the Developer’s Fair Share of Costs, and the City is committing to providing credits/
reimbursements or other adjustments to address the $2.7 million difference.
Developer Pays Fair Share Costs Funding of Regional Improvements
Developer will provide funding for its “fair share” of regional infrastructure improvement costs as
exaction cash payments, through direct construction, subject to credits and reimbursements
Developer Fair Share Allocation
Total "Fair Share" Cost Allocation $22,828,661
Developer Funding Sources
SLR Developer Equity $6,000,000
Mello Roos Community Facilities District (CFD) – SLR Parcels $14,000,000
San Luis Ranch to determine allocation
between residential and commercial.
Credits/Reimbursements/Adjustments
City Adjustments $2,000,000 City to determine sources of adjustments
(e.g., credits, reimbursements, other).
Totals
Estimated Total Funding $22,000,000
Value of Fee Deferral or Other Considerations $828,661 Reflects fee deferral to certificate of
occupancy or other considerations.
Funding Gap $0
Additional Negotiated Housing Commitment
Total Workforce Units 14
Provided in consideration of the City
Adjustments shown above. Distribution of
units will be per Housing Element Policy.
Funding Sources SLR
Cost Allocation Notes
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from the City where justified and issuance of CFD bonds. Estimated cost of the developer’s fair
share is $22.8 million, just over 40 percent of total regional infrastructure project costs. This
developer funding or construction will occur on a schedule consistent with Subdivision Map
requirements or as specified in the Development Agreement.
City and Regional Funding or Construction of Regional Improvements
The larger portion of the regional infrastructure costs, $31.4 million, nearly 60 percent of the
total, falls to the City (and the region) to fund. The City has identified a range of sources for this
purpose as described below. Due to some uncertainty, including what the actual costs are and
also variations in the amounts received from the individual funding sources, it will be prudent to
have a funding contingency, (i.e., identify total funding in excess of the currently estimated cost
of the improvements).
Future Citywide Impact Fee Funding
A number of the infrastructure projects included in the Regional Improvements list are also
included in the City’s updated development impact fee program. These impact fees will generate
fee revenues over time that will be available to fund the regional improvements associated with
the San Luis Ranch development. Some of these fees may not fully recover the total costs of
project improvements, and SLO Ranch may not be paying the total of new fees that are
established, therefore final reimbursement calculations will be necessary when the City does final
adoption of this program.
Contributions from other Benefitting Developers
There are several pending development projects that will benefit from the regional improvements
and thus will contribute funding either as entitlement-related exactions to the City, building part
of the improvement themselves, or through private reimbursement agreements with the
Developer. It is currently estimated that approximately $845,027 in transportation costs2 will be
available over time from these sources and $539,000 in potential private reimbursement3 for
wastewater utility improvements will be sought.
San Luis Obispo Council of Governments Grant Funding
The San Luis Obispo Council of Governments (SLOCOG) administers the major State and federal
transportation grant programs for jurisdictions in San Luis Obispo County. To date SLOCOG has
identified approximately $6,000,000 that may be used to assist with construction of the Prado
Road/Highway 101 Interchange Phase I. Additional funding will be needed as Phase II proceeds.
Other Funding
Approximately $953,000 in funding will be needed from other funding sources, including the
City’s General Fund, to help complete projects that are needed to be built by San Luis Ranch.4
These funds are not able to be passed on to the impact fee programs or reimbursed through
public grant sources.
2 See Item #2, #3, and #12 on Table 3.
3 See Item #24 on Table 3.
4 Per City staff analysis dated 2/8/18.
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Tax Increment Funding
The City is currently in the process of seeking annexation of the San Luis Ranch territory to the
City. As a part of this annexation process, a “property tax exchange agreement” is necessary to
establish a property tax base and increment for the City. Property taxes are one of the main
revenue sources the City uses to fund its municipal services as shown in the San Luis Ranch
Fiscal Impact Report.5 Because the regional improvements benefit San Luis Obispo County,
accommodating trips starting or ending in the unincorporated portions of the County, there is an
obligation to fund a proportional amount of the region-serving infrastructure, specifically
components of the Prado Road/Highway 101 Interchange.
As a part of ongoing negotiations, the County has expressed interest in devoting a portion of the
property taxes that it would otherwise derive from development of the San Luis Ranch Project to
a special “tax increment fund” that would fund their cost allocation. At the same time, the City
may be willing to match a similar percentage of the property taxes it will receive under the terms
of the existing Master Property Tax Exchange Agreement to fund the City’s portion of the
regional improvement costs. In both cases this pledge of tax increment would be for a
predetermined period of years required to accumulate or pay debt service on a related debt issue
or loan.
Economic Considerations
Project Feasibility
As a part of achieving new development as envisioned in the City’s General Plan and specified in
specific plans or other zoning actions, it is in the interest of the City to cooperate with developers
and builders to promote feasibility of new development, (i.e., that new development generates
economic returns sufficient to attract necessary private equity investment and commercial
lending). While market conditions can constrain investment at low points in the business cycle,
over the longer terms the type and amount of development authorized by the City and the costs
imposed for needed infrastructure and facilities should balance so as not to unnecessarily impede
desired development.
Financial Burden Measures
A variety of methods are used to determine the cost burden placed upon new development
associated with providing the necessary infrastructure including in-tract and backbone
infrastructure improvements and contributions to City-serving infrastructure through payment of
impact fees or other mechanisms. The San Luis Ranch Project, given the real estate values
created and the total cost of infrastructure improvements, is shown to fall within reasonable
market levels of financial burden.
Incidence of Burdens
Depending upon the type of funding relied upon to develop a project, the “incidence” of the
burden (who pays?) varies. Equity provided by the developer for project costs including
contributions to public infrastructure and facilities is a burden on the equity investors in the
project. Special taxes or assessments on real property are a burden on the local homeowners or
5 Ibid.
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businesses subject to these taxes or assessments. Excise taxes (e.g., sales taxes, utility taxes,
transient occupancy taxes) are a burden on those engaging in purchases of these goods. The
City has established CFD policies which place a 1.8 percent “cap” on property tax burdens.
The San Luis Ranch project is located in County Tax Rate Area (TRA) 112-002 which has a total
current tax rate of 1.07225 percent, reflecting the basic 1 percent as well as voter-approved
overrides.6 Future additional tax overrides related to voter-approved general obligation bonds
and special taxes or assessments may be approved in the future.
6 San Luis Obispo County Auditor-Controller.
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5.IMPLEMENTATION MEASURES AND RELATED ACTIONS
The Financing Plan will be implemented concurrent with approval and subsequent development
of the San Luis Ranch area. Key components of implementation will include the following.
1.Adopt Development Agreement
The Entitlement Documents for the San Luis Ranch Project include a Development Agreement,
which is a contract between the Developer and the City that vests the entitlement over a long
term (20 years) as consideration for extraordinary benefits to be received by the City for
granting the vesting. The San Luis Ranch Development Agreement largely provides a framework
and security for funding the regional infrastructure improvements and the related reimbursement
to the Developer for investments that exceed the “fair share” cost allocation for these
improvements.
2.Administer Subdivision Map Conditions
A vesting tentative map was adopted for the San Luis Ranch in July 2017. The Subdivision Map
includes an extensive set of conditions that must be met by the Developer as the project is
developed, including construction of all “in-tract” infrastructure improvements and other
obligations.
3.Adopt and Administer City Development Impact Fees
The City of San Luis Obispo levies a range of development impact fees on new development.
These currently include fees for transportation improvements, parks and recreation
improvements, and water and wastewater connection charges.7 These fees are levied on a
citywide basis and also additional fees are charged within specific subareas of the City where
additional local infrastructure is required. In 2018 the City completed a major update to its
impact fee program that includes new fee categories for public safety and revisions to existing
fees. The San Luis Ranch Project will be charged the fees that were in place at the time the
vesting tentative map was adopted, subject to the adjustments specified in the Development
Agreement. If the developer builds improvements that are funded by the impact fees they will be
eligible for a credit against the respective fee liability that will be passed on to subsequent
builders otherwise subject to the fees. If infrastructure is oversized with respect to the
developer’s “fair share” cost allocation, the value of the oversizing will be reimbursed with fee
revenue received from other development subject to the fee.
4.Prepare and Administer Reimbursement Agreement(s)
The San Luis Ranch Development Agreement will enable and specify the terms and security for
reimbursement agreements that will be created for each of the individual regional improvements.
7 In addition, the City charges in-lieu fees for park land, public art, and affordable housing; however,
these in lieu fees are often the subject of specific negotiations.
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Projects Eligible for Private Reimbursement
Three projects have been identified that may be eligible for private reimbursement. Alternatively,
these improvements may be incorporated into the updated Impact Fee Program.
Froom Ranch Way: Oceanaire to Target Driveway (Item #2 on Table 3)
Froom Ranch Way and LOVR Intersection Widening (Item #3 on Table 3)
Higuera & South: Lengthen North Bound Right Turn Pocket (Item #12 on Table 3)
Projects Eligible for Impact Fee Credits
Insofar as the Developer builds or directly funds infrastructure improvements that are included in
one of the City’s development impact fees, the Developer is eligible to receive credit against its
fee obligations for these improvements. The Development Agreement will specify the precise
terms of these fee credits. Currently, the following projects may be eligible for impact fee credits
(see Table 3).
Madonna and Dalidio/Prado Intersection Widening
US SB Ramp at Los Osos Valley Road
LOVR and Higuera Intersection
Turn Lane extensions at Madonna and Oceanaire, and Madonna and LOVR
Prado Road Class I Bike Path US 101 to South Higuera
Additionally, some projects may be eligible for crediting under the City’s updated Mitigation Fee
Act Transportation Impact Fee program. Final credit amounts are subject to final Council
approval. Potential projects that may receive crediting under the revised program include:
Madonna Road Class I Path (US 101 to Oceanaire)
Madonna and Oceanaire Pedestrian Crossing Enhancements
Prado Road and South Higuera Widening
Prado Road Class I Bike Path in front of US Post Office
Bob Jones Trail (Calle Joaquin to Froom Ranch Road)
It is estimated that approximately $2,142,000 in potential impact fee credit for project
construction and mitigation fee requirements will be available to assist in delivering the
improvements needed by the San Luis Ranch development.8
Source of Reimbursement Agreement Funding
A number of infrastructure improvements are specified in the City’s development impact fee
programs and Environmental Impact Fee mitigation measures that the San Luis Ranch Developer
will fund or build beyond its “fair share” allocation of cost. These contributions will be eligible for
reimbursement from fees paid by other developers benefiting from these improvements or from
other sources.
Community Facilities District
A CFD, as enabled by the Community Facilities District Act of 1982, allows a local jurisdiction to
levy a special tax within a specified area to pay for public services and/or infrastructure needed
8 Per City staff analysis, dated 2/8/18.
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within the area. Over the past three decades, CFDs have become a common mechanism for
cities to fund services and finance development-related infrastructure. The levy of any special tax
and any related bond issuance is subject to voter approval, and if the area is inhabited, approval
by two-thirds of the voters in the area is required. If fewer than 12 voters are located in the
area, approval by the landowners is required (San Luis Ranch area currently has no residential
uses).
City Policy and Approach
The City of San Luis Obispo has not, before this San Luis Ranch Project, created any CFDs to
fund capital improvements. The City has, in anticipation of San Luis Ranch and other
development-related financing requirements, adopted policies and procedures related to CFDs
that guide formation of the San Luis Ranch CFD. A key policy adopted by the City is that
“aggregate” property tax burden within the City should not exceed 1.8 percent of assessed value
annually.
Funding Capacity
The funding capacity of a CFD is based upon the type and amount of development within the
bounds of the CFD and the amount of the special tax levied against each parcel. Special taxes
levied as part of a CFD must clearly specify a “rate and method of apportionment” which defines
the amount of the tax levied on each parcel and how the amount may be increased (indexed)
over time to account for inflationary cost increases. Generally, CFD special taxes are limited to a
fraction of the 1 percent property tax allowed under Article 13 A of the State Constitution.
The funding capacity of the San Luis Ranch Project, taking account of the market value of
development being created, the existing general and special taxes, and the City’s established
special tax “cap” of 1.8 percent, is estimated to be approximately $2.9 million annually. Given
market conditions and maximum equivalent HOA rates in the community of $200 per month, and
the significant amount of smaller multifamily units, the aggregate tax burden on residential units
may limit this capacity to below this maximum, resulting in a funding capacity of approximately
$1.7 million per year.
Special Tax Components
The San Luis Ranch CFD is primarily being formed to provide a source for infrastructure funding
to be allocated at the Developer’s discretion. The “Rate and Method of Apportionment” that will
be developed as part of CFD adoption will specify how the San Luis Ranch special taxes shall be
allocated. Based upon current cost analysis, the allocation of CFD special tax funding at full
development of the San Luis Ranch Project area would include $14 million towards infrastructure
funding. Within this total, there will be a component for administration.
CFD Administration
The City will be required to administer the CFD from year to year. Given the nature of the special
tax (a fixed tax rate plus an index-based inflator), this administration is quite simple, involving
sending documentation to the County Tax Collector as the annual property tax bills are prepared.
This service is typically provided by consultants to the City and costs approximately $10,000 to
$20,000 per year depending upon the size of the CFD and complexity of the special tax. There
will be some additional administration required by the Finance Department to control CFD funds
consistent with the terms of the Rate and Method of Apportionment and related financial
reporting (in the CAFR, etc.).
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Formation Process
It is anticipated that the CFD formation will be initiated at the time the San Luis Ranch
annexation is adoption by the City Council. The following steps must be accomplished as part of
the CFD formation process:
Develop CFD concept and document costs to be funded
Map CFD Boundary and conduct voter determination (area occupied area or unoccupied?)
Prepare Rate and Method of Apportionment
Adopt Resolution of Intention
Adopt Resolution of Formation and set date for election
Conduct election (or obtain landowner approval)
Adopt Ordinance to Levy Special Tax
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071928\ 9447955 Exhibit D-1
EXHIBIT D
FEASIBILITY MEMORANDUM
(attached)
Packet Page 135
M E M O R A N D U M
To: Derek Johnson, City Manager
Michael Codron, Director of Community Development
From: Walter Kieser and Ashleigh Kanat
Subject: San Luis Ranch Financial Feasibility and Funding of Region-
Serving Improvements; EPS #161142
Date: May 17, 2018
As a part of our broader scope of financial services related to the
San Luis Ranch Specific Plan Project, Economic & Planning Systems, Inc.
(EPS) has been asked to evaluate the financial feasibility of the Project
from a private sector “developer” perspective, explore how the costs for
the regional infrastructure beyond the “fair share” of costs attributable
to San Luis Ranch can be funded through combined private and City
sources, and also explore the community benefits deriving from the
development of the Project, including the general benefits expected to
occur and also the “extraordinary” benefits offered by the Developer in
connection with the City’s willingness to enter into a development
agreement. It is important to document feasibility to assure that the
Project, as planned, can meet its infrastructure financing obligations
while remaining competitive and feasible in the marketplace. Regarding
the extraordinary community benefits offered, it is necessary to find that
these benefits to the community equal or exceed the value of the
Development Agreement to the Developer.
This Memorandum documents this financial review effort which has
included a careful and cooperative effort involving City staff and
representatives of the Developer Team to identify Project-related
infrastructure items and their cost estimates, estimating the value of
community benefits, preparing and reviewing confidential financial
information from the Developer (i.e., information subject to a non-
disclosure agreement), and identification and evaluation of funding
options available to the Developer and the City to fund needed regional-
serving infrastructure.
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Findings
1.San Luis Ranch Project has the potential to achieve the financial returns necessary
to attract the needed equity and commercial credit.
Based upon our review of the Developer’s pro forma financial analysis it is our opinion that
the San Luis Ranch Project can be financially feasible as indicated by the measures of
financial return applied and the Developer’s willingness to accept the indicated level of
return. This finding is highly sensitive to the market pricing ultimately achieved and the
respective absorption rates of proposed residential and commercial development, the actual
overall project development costs, and the Project’s actual “fair share” allocation of region-
serving infrastructure costs. As the average home price increases within the range of pricing
indicated by market analysis, financial returns improve proportionately. It is noted that the
Developer is not providing a “guarantee” on the pricing of the homes (other than deed
restrictions on the inclusionary and 14 workforce housing units secured by the Development
Agreement).
2.The City has a range of options for funding region-serving infrastructure beyond
the “fair share” allocated to San Luis Ranch.
As a part of the broader environmental impact and traffic analysis for the San Luis Ranch
Project the City has identified some $54.2 million of improvements that are needed to serve
the Project while also alleviating existing traffic congestion and serving other future
development in the southern area of the City and nearby unincorporated portions of the
County as development occurs over the coming decades. Of this amount, approximately
$25.5 million in upfront costs are required of the project to complete project specific
improvements. Approximately $22.8 million of these costs are attributable to the San Luis
Ranch Project based upon the City’s “fair share” cost allocation technical analysis.1 This
leaves a net amount to be funded from other City, private or regional sources of $31.4
million to fully complete the $54.2 million of total projects required for the San Luis Ranch
development. There are a range of funding and financing options to pay for the non-project
share of these improvements, including private reimbursements, integrating these projects
into the City’s development impact fee programs as part of ongoing update efforts, working
with the County to ensure the County pays its “fair share” allocation and obtaining a portion
of future regional funding.
3.The San Luis Ranch Project will create a range of community benefits and offers
“extraordinary” community benefits that exceed the value of the Development
Agreement to the Developer.
The San Luis Ranch has been designed to achieve a high development standard and as such
will confer a range of community benefits to the City including implementation of General
Plan policies, creation of construction and permanent employment, providing parks and open
space areas in an area of town that is deficient of public parks, and funding needed
improvements to region-serving infrastructure. Additionally, extraordinary community
benefits (beyond those items that occur as the result of Project development or are otherwise
required by City regulation or policy) are being offered including funding infrastructure
beyond the Developer’s “fair share” cost allocation, providing home sales preferences for
1 The fair-share allocation analysis is based on the City’s transportation model and represents a
collaborative effort between the City’s transportation department and the Project developer.
Packet Page 137
local workers and owner occupants, providing a workforce housing program, providing land
and building an Agricultural Heritage and Learning Center, exceeding State and City’s energy
efficiency standards and thereby accelerating compliance with the City’s Climate Action Plan,
and exceeding the City’s multimodal goals and objectives. Based upon our analysis, the
extraordinary community benefits are estimated to be $14.25 million and the value of the
Development Agreement to the Developer is estimated to be $7.05 million, thus the benefits
to the community outweigh the Developer’s benefits.
Project Revenues
The San Luis Ranch Project revenue will be derived primarily from building and selling homes.
Additional revenue will be derived from sale of parcels to other builders. The residential pricing
assumptions used in the pro forma financial analysis reflect a market range of average prices for
single-family for-sale housing from $525,000 to $625,000 (the top of the market range indicated
by market analysis for the expected residential prototypes). The pro forma financial analysis
shows sales of housing and the commercial parcels occurring (following site work that begins in
2018/19) from 2020 through 2026. Pricing and absorption assumptions are consistent with
current and expected future market conditions, and considered conservative for purposes of the
pro forma analysis. The Project’s Affordable and Workforce Housing Program is reflected as a
discount on Project average home pricing and beyond these price-restricted units, as noted
above, no other price restrictions will occur.
Project Costs
Project costs shown in the pro forma financial analysis include the full range of costs required to
develop the Project Site and construct the residential component of the San Luis Ranch Project:
•Land acquisition
•Pre-development costs
•Site improvements
•City development impact fees and permitting fees
•Offsite improvements including the “fair share” allocation of regional improvement costs
•Financing costs, including returns on initial equity invested and construction loan interest
•Vertical construction costs and contingency
These costs as reflected in the pro forma financial analysis all appear to fall within a range typical
for such large development projects, with the exception of the “fair share” allocation of the
regional improvements, as has been noted.
Rate o f Return to Equity Investment
The San Luis Ranch Project, as is the case for all major development projects, requires
substantial equity investment as well as commercial credit for both site “horizontal” development
and building “vertical” construction costs. Real estate finance became considerably more difficult
as the result of the Great Recession due to increased standards and costs for commercial credit
including higher equity requirements to obtain credit. The San Luis Ranch Project also carried a
significant land acquisition cost since its purchase in 2015. These higher equity investments and
requirements increase the need for equity investment and also contribute to overall costs due to
the greater risks involved in equity investment. Our review of the pro forma financial analysis
involves review of all data and assumptions regarding their veracity and also viewing resulting
financial returns from a variety of perspectives. In this instance we have concluded that
Packet Page 138
the “internal rate of return” method indicated in the San Luis Ranch pro forma financial analysis,
given the use of leverage involved, meets typical real estate industry standards and is acceptable
to the Developer as a basis for moving forward with the Project development.
San Luis Ranch Infrastructure Financing Strategy
In cooperation with City staff and the Project Developer Team, EPS has documented
infrastructure needs and costs and options for funding this infrastructure as part of the broader
effort to prepare a Financing Plan for the San Luis Ranch Project. As a part of this overall
Financing Plan there are two components for fund region-serving infrastructure: 1) assuring that
the San Luis Ranch Project commits developer equity to funding infrastructure costs within th e
Project and also their “fair share” of offsite regional improvements and 2) funding the portion of
offsite regional improvements not allocated to San Luis Ranch. Our analysis has determined that
the funding for both the project-related “fair share” and the City and regional “fair share” can be
secured. Table 1 presents the strategy for funding region-serving infrastructure.
Table 1 San Luis Ranch Infrastructure Financing Strategy
Developer Fair Share Allocation
Total "Fair Share" Cost Allocation $22,828,661
Developer Funding Sources
SLR Developer Equity $6,000,000
Mello Roos Community Facilities District (CFD) – SLR Parcels $14,000,000
San Luis Ranch to determine allocation
between residential and commercial.
Credits/Reimbursements/Adjustments
City Adjustments $2,000,000 City to determine sources of adjustments (e.g.,
credits, reimbursements, other).
Totals
Estimated Total Funding $22,000,000
Value of Fee Deferral or Other Considerations $828,661 Reflects fee deferral to certificate of occupancy
or other considerations.
Funding Gap $0
Additional Negotiated Housing Commitment
Total Workforce Units 14
Provided in consideration of the City
Adjustments shown above. Distribution of units
will be per Housing Element Policy.
Funding Sources
SLR
"Fair Share"
Cost Allocation
Notes
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Community Benefits
The San Luis Ranch Project, by virtue of its development and conforming to City planning
policies, regulatory standards, and mitigating potential environmental impacts, will confer a
range of community benefits in the City of San Luis Obispo. These positive effects of the project
including community development objectives or social, economic and/or fiscal benefits, while a
precondition for a development agreement, are considered as extraordinary community benefits:
1.Creating a new residential neighborhood and commercial district in the City consistent with
General Plan policies.
2.Providing a range of housing prototypes that include small, higher density units that will be
“affordable by design”.
3.Providing new housing targeted at the City’s lower income and working families and including
34 contractually price-restricted affordable (inclusionary) housing units, and an additional 14
price-restricted workforce housing units.
4.Achieving “net-zero” energy consumption and other energy efficiency standards.
5.Generating employment opportunities for the City’s construction-related companies and
workers.
6.Financing infrastructure that in addition to meeting travel demands created by the Project
relieves existing congestion and provides additional capacity for other future development.
7.Providing more than 50 acres of open space including land set aside for continued
agricultural use preserving the area’s agricultural heritage.
Extraordinary Community Benefits
“Extraordinary” community benefits of a development project are public improvements or other
material offerings that cannot be required by the City based on its code requirements or CEQA
mitigation, each which must meet Constitutional statutory standards to achieve the “rational
nexus” test. A complete listing of the extraordinary community benefits being offered by the San
Luis Ranch Developer is shown in Table 2. Specifically, the developer has committed to
constructing or funding improvements or mitigating impacts that exceed the mitigation measures
specified in the project environmental impact report or other City-determined requirements. The
developer has also agreed to build a public improvement in advance of when it might otherwise
be required. For example, an intersection improvement that may not be required to mitigate
project-induced congestion until five years in the future could be built in advance, assuring that
the improvement is constructed and conferring congestion reduction immediately. These
improvements include the following:
1.Land and Building Dedications
2.Multi-Modal Transportation Improvements and Programs
3.Energy and Water Conservation Features
4.Affordable and Workforce Housing Programs
Taken as a whole these cited community benefits total $14.25 million. The estimates were
prepared by the Developer’s financial consultant, Kosmont Companies, and have been reviewed
for the reasonableness of the assumptions used and computational accuracy by EPS.
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Table 2 Summary of Extraordinary Community Benefits
Comparing the Value of Community Benefits with Value Received by Developer
As part of reaching a Development Agreement it is customary that the community benefits
offered by the Developer meet or exceed the value(s) conferred on the Developer by the City. As
a general measure the extraordinary community benefits offered should meet or exceed the
estimated value of the vested entitlement to the developer combined with the additional benefit
to the developer from other special terms granted by the City (e.g., infrastructure financing
contributions, formation of financing districts, etc.).
Value of Vesting the Entitlement
As a part of this effort a review of the Developer’s pro forma financial analysis was conducted by
EPS, subject to the terms of a non-disclosure agreement. Applying the standard method of
measuring a reduction in the “threshold IRR” associated with reduced risks and costs to the San
Luis Ranch project associated with two vesting assurances: 1) elimination of future planning or
regulatory changes (i.e., rezoning of the Project area) and 2) assuring project development
phasing through a fixed allocation of housing units pursuant to City’s Growth Management
Ordinance. These two considerations are estimated to confer a value of approximately
$2.75 million to the Developer.
Dollar Value Beyond
SLR's Fair Share
1.0 Land and Building Dedications
1.1 Agricultural Heritage and Learning Center - Building Costs (Net of Mitigation Requirements)$2,025,000
2.0 Multi-Modal Transportation
2.1 Bike Share/Rental $290,000
2.2 Car Sharing/Park & Ride $290,000
2.3 Electric Car Charging Stations $240,000
3.0 Energy and Water Conservation Features
3.1 Solar PV [1]$3,204,500
3.2 Building Efficiency/Net Zero $725,000
4.0 Affordable and Workforce Housing Programs
4.0 Priority for SLO Residents, Workers (1.5% of Initial Sales Value)$4,468,875
4.2 Owner Occupancy Restriction on NG-10 and NG-23 Units (1.5% of Initial Sales Value)$2,703,000
4.3 Local Heroes Program - Minimum of $1,500 Incentive per Home (Assuming Approx. 200 Homes)$300,000
$14,250,000
[1]
Sources: San Luis Ranch; City of San Luis Obispo; Kosmont Companies; Economic & Planning Systems, Inc.
Extraordinary Community Benefit Items Offered by San Luis Ranch
Total Extraordinary Community Benefits (Rounded)
Total cost of Item 3.1 is $4,930,000. San Luis Ranch's fair share is 35%, or $1,725,500. The balance of $3,204,500 represents value to
the City beyond San Luis Ranch's fair share.
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Value of Terms Offered Conferring Additional Benefit to the Developer
As noted, the developer has requested other considerations intended to lower costs or improve
project revenues in pursuit of adequate financial returns. In this instance, the additional benefits
to the Developer offered in the Development Agreement include the willingness to establish and
administer a Community Facilities District (CFD) to finance a portion of the Developer’s share of
regional infrastructure costs.
The value of the CFD to the Developer has been estimated by comparing the interest rate
available through municipal bonds to commercial credit. Given the expected $14 million bond
issuance, it is expected that over the 30-year term of the bond interest rate savings would be in
the range of $4.3 million.
In summary, it is concluded that the Development Agreement extraordinary community benefits
offered to the City by the Developer, estimated to be $14.25 million, exceed the estimated $7.05
million of benefit received by the San Luis Ranch Developer by approximately $7.2 million.
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071928\ 9447955 Exhibit E-1
EXHIBIT E
AGRICULTURAL LAND OPERATIONS & GUIDELINES
(attached)
Packet Page 143
Revised 12-08-2017
Exhibit E
Operational Requirements and Guidelines for the Agricultural Land
on San Luis Ranch
In addition to the conditions of the Project Approvals and the terms of the Development Agreement, San
Luis Ranch agrees to the following:
Agricultural Heritage Facilities and Learning Center:
The Agricultural Heritage Facilities and Learning Center (the “Agricultural Heritage Learning Center”) will
include the historically significant Dalidio Home, Racetrack Viewing Stand and Hay Barn. The restored
agricultural setting will allow San Luis Ranch residents and visitors to experience the working farm much
as it operated in decades past, and learn about current organic farming practices. The Agricultural
Heritage Learning Center will be a destination for the San Luis Obispo community and will feature local
food, farming and cooking education and build a lasting connection to our agricultural heritage.
Operational Milestones:
(a)Prior to issuance by the City of any grading permits for the Property, the Developer shall
submit a draft Organic Farm Management Plan (the “Farm Plan”) to the City for review
and approval. At a minimum, the Farm Plan shall have the following components:
i.A preliminary operations plan for the Agricultural Land (as defined in the
Development Agreement) which shall include: a description of the necessary
licenses and permits for all agricultural operations on the Agricultural Land
covered by the permanent Agricultural Easement; a description of practices
and procedures to be performed and maintained to achieve compliance with
the Specific Plan, including progress toward and attainment of organic
certification, and to ensure continued agricultural operations on the
Agricultural Land covered by the permanent Agricultural Easement; a
description of the monitoring practices and procedures to be performed and
maintained, including the frequency with which they will be performed, to
verify that the plan is effectively implemented; a description of the
accounting and recordkeeping system; any additional information deemed
necessary by the City to evaluate compliance with the Specific Plan and to
ensure continued agricultural operations.
ii.A preliminary education plan for the Agricultural Heritage Learning Center,
outlining potential educational opportunities on the permanent Agricultural
Easement area and Agricultural Heritage Learning Center.
(b)Prior to issuance of grading permits for the multi-family component of the Project, the
Developer shall restore and relocate the three existing on-site historic structures to the
Agricultural Heritage Learning Center at the northeast corner of the farm, maintaining
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Revised 12-08-2017
their approximate original solar orientation and relation to one another. These historically
significant structures will include an agricultural processing center and a farm stand for
local goods and products. These structures will be open to the public for community
gatherings and educational programs. Prior to the construction of the Prado Road
overcrossing, these facilities shall only be open for use by the residents of the Project and
the lessee of the adjacent City Farm Property.
(c)No later than one year after completion of on-site grading on the Agricultural Land
covered by the permanent Agricultural Easement, or prior to the execution of a lease of
that Land, whichever occurs first, the Developer shall submit a final Farm Plan to the City’s
Natural Resources Manager for review and approval, which shall not be unreasonably
withheld, and the developer shall enroll the area within the permanent Agricultural
Easement in the USDA organic certification program or an equivalent. The parties
acknowledge that the Farm Plan is subject to change and/or amendment and that any
such modifications shall be subject to review and approval by the City’s Natural Resources
Manager, which shall not be unreasonably withheld. All annual organic reports and
operational statements shall be provided to City upon request.
(d)Developer agrees to incorporate the Farm Plan in any lease entered into for agricultural
operations on the Agricultural Land. Any such lease shall contain a clause terminating
that lease if there is continuing non-compliance with the Farm Plan after sixty (60) days
of receipt of notice and otherwise empowering the developer to take steps sufficient to
enforce the Farm Plan.
City’s Remedies
(a)If Developer fails to submit the draft Farm Plan or the final Farm Plan when and as set
forth above, or if City determines that the Agricultural Land is not operating in accordance
with the approved plan, City shall provide written notice to the Developer of such
violation and demand corrective action sufficient to cure the violation.
(b)Developer shall have ten (10) working days to submit a Farm Plan or ninety (90) calendar
days after notice from City to bring the farm operations into compliance with the Farm
Plan.
(c)After conclusion of the ten (10) working day or ninety (90) calendar day period, as
applicable and following the termination of any existing lease and the eviction of any
tenant, City shall have the right to require the Developer to execute a lease with an
organic farmer of City’s choice, subject to approval by Developer which shall not be
unreasonably withheld or delayed. City shall have the right to dictate the terms and
conditions of said lease. Developer acknowledges and agrees that, should Developer
refuse to approve such tenant or refuse to execute such lease, City shall have the right to
seek specific performance to compel Developer to execute such lease. In addition to the
foregoing remedy, City may seek an injunction prohibiting Developer from using or
further leasing the Agricultural Land. City may also seek appointment of a receiver to take
control of the Agricultural Land pursuant to Code of Civil Procedure §§ 564 et seq.
Developer acknowledges that the continued agricultural operation of the Agricultural
Land is a critical community value and an important component of the City’s approval of
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Revised 12-08-2017
the San Luis Ranch project and developer agrees that a receivership is an appropriate
remedy per Code of Civil Procedure § 564(a)(9) in order to preserve the Agricultural Land
and the rights of the City should Developer, or its successors and assigns, fail to comply
with this Agreement and the conditions of the Project Entitlements relative to the use,
operation and care of the Agricultural Land, including the requirements of in this Exhibit
F.Developer acknowledges the remedies set forth herein are cumulative to each other
and to any other remedy afforded to City in law or in equity and that no election of
remedies shall apply.
(d)The Developer shall bear any and all expenses, costs and liabilities the City incurs to
enforce this Agreement and the conditions of the Project Entitlements relative to the use,
operation and care of the Agricultural Land, including the requirements of this Exhibit F,
including, without limitation, costs of suit and attorneys’ fees.
(e)For purposes of ensuring the City has legal standing to enforce these remedies, all leases
of the Agricultural Land shall include language granting City the Special Power of Attorney
to enforce any defaults under the terms of the lease.
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071928\ 9447955 Exhibit F-1
EXHIBIT F
AFFORDABLE/WORKFORCE HOUSING PLAN
(attached)
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Exhibit F
Affordable & Workforce Housing Plan
Affordable Housing Plan
The San Luis Ranch project will encourage long term housing affordability by including design and devel-
opment strategies that provide lower cost housing, by including a range of housing sizes and types that
are not typically provided in the community, including deed-restricted workforce units, and by providing
lower income inclusionary units as required by the City Inclusionary Housing Ordinance. Since the price
of houses over time is most closely related to the size of the dwelling unit, the size of the lot, and costs of
maintenance, the project has concentrated on lowering the overall size of market rate dwelling units, and
reducing lot size for market rate units.
Within each of the residential zones there will be dwelling unit sizes ranging from 220 square foot studios
to 2,200 square foot single family detached units. Lot sizes range from air-space studios to 3,200 square
feet. Consequently, the average size of the units and lots across the development is far smaller (less than
½ the size) of existing residential housing stock in the City.
Maintenance expenses, to the extent feasible, may be included in a Community Facilities District to reduce
the necessity for Homeowner’s Association fees and other costs associated with that maintenance and
governance structure. Landscape maintenance and cost of water and utilities will also be reduced through
the use of drought tolerant landscaping, smaller lots and other sustainable and cost reducing features.
The City’s Housing Element provides incentives to develop housing in a denser pattern, with smaller unit
sizes to encourage affordability across the low, moderate and workforce income ranges. These incentives
include reduced inclusionary housing requirements for denser projects and for projects with lower dwell-
ing unit square footages. Conversely, more inclusionary housing is required for projects with dwelling
units that exceed unit sizes of 2,000 square feet. Table 2A of the Housing Element contains these adjust-
ment factors.
According to the City’s Inclusionary Housing Ordinance and Table 2A, the inclusionary housing require-
ment for the residential component of the San Luis Ranch project is a total of 34 units, with 26 very low,
4 low, and 4 moderate income units. These inclusionary units will be integrated throughout the project in
the single-family detached, townhome, studio, 1 and 2-bedroom condominium products. In addition, the
commercial component of the project requires a total of 34 inclusionary units. The project proposes to
meet the commercial component requirement by either constructing these units on-site or paying an af-
fordable housing in-lieu fee.
City Residential Requirements
The San Luis Ranch Specific Plan includes locations for on-site units to fulfill the affordable housing re-
quirement for the residential development planned for the Specific Plan Area. Including residential uses
only, the Specific Plan Area must provide a total of 34 deed restricted affordable units in the development,
and must provide at least 5% low and 10% moderate income affordability per Table 2 of the Housing
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San Luis Ranch March 6, 2018
Affordable & Workforce Housing Plan Page 2 of 7
Element. Any additional units provided above the inclusionary requirement could be sold or rented at
market rate. See residential calculation below.
Residential Inclusionary Requirement Calculation
# of
Units
Density
(units/acre)
Unit
S.F.
Build 5%
(very low
income)
Build 10%
(moderate
income)
Total Base
Required
Adjust
Factor
Required
Inclu-
sionary
Units
200 NG-30 1,000 10 20 30 0 0
100 NG-23 1,300 5 10 15 0.25 3.75
200 NG-10 1,500 10 20 30 1 30
80 NG-30 NA
Total 34
City Commercial Requirements
The commercial uses envisioned in the Specific Plan Area will be required to provide an additional 34 units
of affordable housing. The commercial inclusionary calculations for the San Luis Ranch Specific Plan are
as follows:
Commercial Inclusionary Requirement Calculation
Use Acreage x 2
Required
Inclusionary
Retail 9.45 2 18.9
Hotel 3.5 2 7
Office 3.7 2 7.4
Total 34
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San Luis Ranch March 6, 2018
Affordable & Workforce Housing Plan Page 3 of 7
The San Luis Ranch project will address housing affordability in several ways, most notably through the
design itself, which includes medium and high-density housing with lot sizes and floor areas that are well
below the typical average for existing single-family detached units in the community.
The City’s Inclusionary Housing Requirement will be addressed through deed restrictions on very low, low
income and moderate-income units to be constructed by San Luis Ranch, and/or provided by dedicating
and donating improved land to a non-profit affordable housing provider. However, should an affordable
housing provider fail to construct the units, the obligation to provide for the 34 deed-restricted affordable
housing units remains with San Luis Ranch to complete. The following highlights are summarized from the
Specific Plan:
•Mix of Residential Densities and Small Lots. There is an intentional mix of residential densities in the
San Luis Ranch project that includes a range of small lot sizes, attached townhomes, and multifamily
dwellings, with an emphasis on higher density units. Floor plans ranging from 220 to 2,200 square feet
in studio, 1 BR/1BA, 2BR/1BA, 2BR/2BA and 3BR/2BA configurations. The average unit size across the
entire project is less than 1,330 square feet.
•NG-10 Zoning. The San Luis Ranch Specific Plan includes 200 small-lot, single family units, which are
intended to meet the needs of young professionals, empty nesters and young families. These smaller
units, ranging in size from 1,300 square feet to 2,150 square feet, have one-or two car garages with
limited guest parking spaces. This parking reduction is justified by the lower expected occupancy for
these smaller units and the multimodal features of the overall development. The four inclusionary
moderate-income units will be provided on in Phase 1 of the project on Lots 53, 64, 174, and 191.
•NG-23 Zoning. The San Luis Ranch Specific Plan includes 100 attached and detached townhome units,
close to services and open spaces. Units will range in size from 1,300 square feet to 2,110 square feet.
Four of these 2- bedroom units will be deed restricted for low-income families. The inclusionary units
will be provided on Lots 261, 267, 283, and 293.
•NG-30 Zoning. Finally, the San Luis Ranch Specific Plan includes 272 studio, one to three-bedroom
multi-family units adjacent to open space and Madonna Road. Like other portions of the project, this
multi-family zone will be directly served by an on-street transit stop and located within easy walking
distance of nearby shopping. 26 of these units will be deed restricted as inclusionary housing for very
low income families. Inclusionary and other multi-family units may be either dedicated to an afforda-
ble housing provider or managed by the San Luis Ranch. Multi-family unit sizes will range from 220
square foot studios to 1,100 square foot units for larger families.
•Neighborhood Commercial. The 19.6-acre Neighborhood Commercial portion of the Specific Plan
area will generate a requirement for 34 additional inclusionary units. Development of this portion of
the project site will be based on market demand. Approximately half of the NC area is currently lo-
cated in ALUP Safety Zone S1-b that precludes residential development; however, the area outside of
the S1-b zone can accommodate the required 34 units. Alternatively, the project may pay an afforda-
ble housing in-lieu fee per the Inclusionary Housing Ordinance and Table 2 of the Housing Element to
satisfy this requirement.
Overall, the project will provide a total of twenty-six (26) very low, four (4) low, and four (4) moderate
Income inclusionary units. The inclusionary housing product mix has been intentionally skewed toward
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Affordable & Workforce Housing Plan Page 4 of 7
very low-income units to ensure that this income group is adequately represented in the project, and to
recognize that the moderate-income groups have adequate market rate opportunities in the NG-10, NG-
23 and NG-30 neighborhoods. Table 2 shows the distribution of the affordable units, and Exhibit 1 shows
the location of the moderate and low-income units. Distribution of the 26 very low-income units will be
included in NG-30 neighborhood as described below.
Inclusionary Housing Phasing Plan
Neighborhood Distribution
Program NG-10 NG-23 NG-30 Commercial Total
Moderate Income (Sale) 4 4 8
Low Income (Sale) 4 4 8
Very Low Income (Rental) 26 26 52
Units in Phase 4 4 26 34 68
Total - Inclusionary Very Low 52
Total - Inclusionary Low 8
Total - Inclusionary Moder-
ate
8
Total 68
*The Commercial Development and associated Inclusionary Housing Requirement will be determined by the Com-
munity Development Department of the time of submittal of detailed plans for that component of the project. This
requirement will be met either by development of units within the commercial project, off-site construction, or by
payment of affordable housing in-lieu fee, or a combination thereof.
Inclusionary Housing Program Synopsis:
The affordable housing located within the residential portion of the San Luis Ranch Specific Plan Area will
provide 34 units on site for very low, low, and moderate income households. The applicant is committed
to including at least 5% very low income units in the project. Per Section 17.90.040.D of the City's Afford-
able Housing Incentives which follows State law, a developer that agrees to construct 5% of the total units
of a housing development for very low income households qualifies for a 20% density bonus. In this case,
5% of the allowed 500 units under the LUCE requires 25 very low income units. The project is proposing
26 very low income units.
The tables above show the required inclusionary units as well as the proposed density bonus units. Me-
dian and low income units (SFR and Townhomes) are intended to be for sale units. The applicant will retain
the flexibility to either rent or sell the very low income units.
Deed-restricted, affordable units will be located throughout the residential portion of the Specific Plan
Area, as illustrated in the above table.
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Affordable & Workforce Housing Plan Page 5 of 7
Workforce Housing Plan
The City of San Luis Obispo has a recognized need for workforce housing (121-160 of Area Family Median
Income). The San Luis Ranch Specific Plan aims to help meet the City’s housing needs by providing a highly
desirable new home type to the San Luis Obispo housing market: small lot (1,000 to 3,200 square feet)
single family and multi-family housing types.
A primary goal of the City of San Luis Obispo, realized and implemented through the San Luis Ranch pro-
ject, is to create workforce housing and increase the supply of housing available to local employees. A
special five-point program will be provided to create workforce housing and increase the supply of hous-
ing available to local employees. This program includes 1) 14 deed-restricted workforce housing units for
eligible households earning 121-160% of the Area Median Income. Two of these workforce housing deed-
restricted units will be located in the NG10 Zone on Lots 105 and 121, two will be located in the NG23
Zone on Lots 251 and 257, and ten will located in the NG30 Zone (See Exhibit 1 for unit locations); 2)
providing local priority preferences for individuals who work within the City of San Luis Obispo to purchase
or rent a residence within the Project; 3)) Owner Occupied Restrictions; 4) “Local Heroes” discount for
public safety, hospital workers and teachers; and 5) participation in the City Equity Share program,
These housing programs seeks to target the Project to local employees, reduce the influence of investors
in the limitation of housing choice and availability, and provide for 14 deed-restricted units.
Notwithstanding anything set forth below, all preferences and/or priorities for workforce housing units
will be administered in accordance with, and subject to, all applicable federal, state and local laws and
regulations, including Fair Housing rules.
Subject to applicable law, the elements of the workforce housing programs are as follows:
•Local Preference (“SLO Workers First”). Program 10.4 of the City’s Housing Element encourages resi-
dential developers to “…sell or rent their projects to those residing or employed in the City first before
outside markets.” Further, the City and project applicants recognize that one of the principal reasons
for the designation of additional residential land in the community in the 2014 Land Use and Circula-
tion Element update was to address the current jobs-housing imbalance. One direct and effective
way of achieving this is to provide priority for existing employees to rent or purchase residences within
the Project. To that end, San Luis Ranch will give first preference to rent or purchase a residence
within the Specific Plan area to local employees identified on the interest list. These areas include the
City’s corporate limits and areas outside the City limits such as Cal Poly, California Men’s Colony,
Cuesta College, agricultural lands within the Edna Valley area and business parks on South Broad
Street. Specifically, for purposes of this program, the term “local employees” shall include individuals
who are employed in business that are located in geographic areas that are customarily included in
the City’s annual jobs-housing balance analysis in its General Plan Status Report, including the follow-
ing zip codes: 93401, 93405 and 93407. New employees to businesses in these geographic areas with
bona fide employment offers will be considered “local employees” as well. San Luis Ranch will main-
tain and update the interest list through full build-out of the Project. San Luis Ranch will operate and
administer this program as follows:
a.San Luis Ranch shall maintain the interest list and shall separate and prioritize names of
local employees based on interest in product type.
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San Luis Ranch March 6, 2018
Affordable & Workforce Housing Plan Page 6 of 7
b.When product becomes available, usually 270-360 days prior to certificate of occupancy
(assuming a 180-day construction period), San Luis Ranch shall notify those individuals of
the opportunity to purchase a residence on a lottery basis. Once notified, those individu-
als shall have approximately 60 days to get pre-qualified to purchase the residence and
to provide San Luis Ranch with proof that the individual is a local employee and the time
notice (i.e. paycheck or bona fide offer of employment from a local employer.)
c.If an individual fails to get pre-qualified or fails to provide San Luis Ranch with proof of
local employment within the time periods above, then San Luis Ranch may remove or put
that name at the end of the interest list.
d.San Luis Ranch agrees not to sell any units within the Project to any individual without
first offering the unit to a local employee who is on the interest list for that product type.
Upon exhausting all local employees on the interest list for a product type, San Luis Ranch
agrees to give priority in the sale of such units to individuals employed in the County, and
finally to individuals from outside the county.
Nothing herein shall preclude San Luis Ranch from notifying multiple individuals with the opportunity
to purchase a residence and prioritizing the purchase and sale based on a lottery basis. Nothing herein
shall preclude San Luis Ranch from taking all reasonable actions necessary in order to facilitate the
sale of units within the Project provided such actions are consistent with the “SLO Workers First”
program described herein. San Luis Ranch shall, upon request, update the City on its implementation
of this program and provide City with the interest list and proof of employment for all sales made
under this program.
City and San Luis Ranch acknowledge that this program described above will accomplish three im-
portant objectives: 1) use new housing to address the current imbalance between existing jobs and
housing; 2) ensure that, to the maximum extent practicable, that the increased housing in San Luis
Obispo results in a decline in the current commute traffic; and, 3) reduce competition from outside
buyers in the initial offering and sales.
•Owner-Occupancy Restrictions. San Luis Ranch agrees to include restrictions in the purchase agree-
ment and Covenants Conditions and Restrictions (CC&Rs) for all single family detached units (NG-10)
and (NG-23) (total of 300 dwelling units) requiring these units to be restricted to owner-occupants for
the first five years after sale. In the case of units with Accessory Dwelling Units (ADUs), the Principal
Dwelling or the ADU will need to be occupied by the property owner. The final form of these agree-
ments will be determined at the time of development of the first final map, and will provide for ap-
propriate monitoring and enforcement. Enforcement and monitoring of the owner occupancy re-
quirement on all single-family dwellings will be controlled by the San Luis Ranch Owners’ Association,
or in coordination with a qualified housing non-profit.
•Local Heroes: San Luis Ranch will offer a special program for buyers who are considered “Local He-
roes.” These Local Heroes are Police, Firefighters, Active and Retired Military, Teachers, EMTs, Nurses
and City or County Employees. Qualification for this incentive is verified on the loan application re-
viewed by our Preferred Lender. (This provision is included to ensure consistent review parameters.
Buyers are not obligated to finance home purchase with Preferred Lender.) Military, Active or
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San Luis Ranch March 6, 2018
Affordable & Workforce Housing Plan Page 7 of 7
Veterans submit separate evidence. San Luis Ranch will provide a minimum $1,500 incentive that is
credited to the buyer at closing and can be used at the design center for upgrades and/or closing
costs.
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Regular Meeting
Wednesday, May 23, 2018
CALL TO ORDER
A Regular Meeting of the San Luis Obispo Planning Commission was called to order on
Wednesday, May 23, 2018 at 6:00 p.m. in the Council Chamber, located at 990 Palm Street, San
Luis Obispo, California, by Chair Fowler.
ROLL CALL
Present: Commissioners Robert Jorgensen, John McKenzie, Nicholas Ostebur, Mike
Wulkan and Chair John Fowler.
Absent: Commissioners Hemalata Dandekar and Vice-Chair Charles Stevenson
Staff: Community Development Director Michael Codron, Assistant City Attorney
Jon Ansolabehere, Principal Planner Tyler Corey, Recording Secretary
Summer Aburashed.
Pledge of Allegiance
Chair Fowler led the Pledge of Allegiance.
PUBLIC COMMENTS ON ITEMS NOT ON THE AGENDA
None
Chair Fowler closed the public hearing
1.CONSENT AGENDA – CONSIDERATION OF MINUTES
ACTION: MOTION BY COMMISSIONER WULKAN, SECOND BY COMMISSIONER
OSTEBUR, CARRIED 3-0-2-2 (Commissioners Jorgensen and McKenzie abstained from voting
and Commissioner Dandekar and Vice-Chair Stevenson were absent ) to approve the minutes of
March 28th, 2018, as presented.
MOTION BY COMMISSIONER WULKAN, SECOND BY COMMISSIONER OSTEBUR,
CARRIED 5-0-2 (Commissioner Dandekar and Vice-Chair Stevenson were absent ) to approve
the minutes of March 29th, 2018, as presented.
Packet Page 155
PUBLIC HEARINGS
Item Number 2 was heard after Item Number 4.
2.1035 Madonna Road. Review of the Draft Supplemental Environmental Impact Report
(SEIR) prepared for the previously-approved San Luis Ranch Development Project during
the 45-day public review period to address the proposed modified development phasing
approach. The meeting is an opportunity to provide an update on the previously-approved
project and for City and consultant staffs to gather information from the public regarding the
analysis and findings of the Draft SEIR. The San Luis Ranch Project includes up to 580
residential units, 150,000 square feet of commercial development, 100,000 square feet of
office development, and a 200-room hotel, with a portion of the site preserved for
agriculture and open space uses. Project #: SPEC/ANNX/ER 1502-2015; Coastal
Community Builders, applicant. (Tyler Corey)
Principal Planner, Tyler Corey, Contract Planner, John Rickenbach, Transportation Manager,
Jake Hudson presented the staff report and responded to Commission inquiries.
Applicant Representatives, Marshall Ochylski and Rachel Kabezi, summarized the project and
responded to Commission inquiries.
Chair Fowler opened the public hearing.
Public Comments
Carolyn Smith
Brian Tietje
Debbie Tietje
Lea Brooks
Theodora Jones
Kevin Howber
Brett Cross
Andrew Hackleman
Chair Fowler closed the public hearing
The following Commission comments were made:
Consider Travel Demand Management Plan; employee schedule out side of peak hour trips
2.4-4, Clarify what the “weave” analysis means in terms of numeric calculation.
2.4-10, Clearly indicate new or revised impacts and mitigation measures from original certified
Final EIR in the Final Supplemental EIR,
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Ensure infrastructure that is required or needed for each particular development component is
provided and improvements triggered by number of vehicle trips are clearly identified.
Provide Commission with a visual regarding estimated length of temporary impacts identified in
the Draft SEIR.
3.790 Foothill Blvd. Review of a new four-story mixed-use project with 6,800 square feet of
ground floor commercial/retail space, 78 residential units, and 155 parking spaces with a request
for mechanical parking lifts and to expand hours of operation for the commercial spaces. Twelve
of the units in the project will be affo rdable to very-low income households, which allows for a
35% density bonus. Two affordable housing incentives are being requested including the
construction of a 43-foot tall structure where 35 feet is normally allowed and an increase in
allowable lot coverage from 75% to 90%. The project is both statutorily exempt under Section
15195 and categorically exempt under Class 32, In-Fill Development Projects, Section 15332 of
the CEQA Guidelines. Case #: USE-1187-2017, C-C-SF Zone; LR Real Estate Investment
Group, LLC, applicant (Rachel Cohen)
Continued to a date uncertain.
Public Comments
None
Chair Fowler closed the public hearing
BUSINESS ITEMS
4.Zoning Regulations Update. The Zoning Regulations Update is focused on implementing the
policies and programs of the Land Use and Circulation Elements (LUCE). This will be a
standing item on the Planning Commission agenda from June 14, 2017 through completion of
the Update of the Zoning Regulations, tentatively scheduled for completion in March 2018. This
will be an opportunity for staff to update the Commission on the status of the Zoning Regulations
Update and for the Commission to listen to ongoing public testimony and discuss any such
updates as they come forward. As a standing item, sometimes there will be nothing to report;
other times staff will give a brief update with limited discussion; and at certain points, such as
review of the Land Use Table, Parking Requirements, and the Reformatted Outline, there will be
more substantive discussion on the item. When ma terials are associated with the Update, as with
the White Papers associated with the Update, such information will be made available to the
public and Commission prior to the meeting. (Doug Davidson/Kyle Bell)
Chair Fowler opened the public hearing.
Public Comments
None
Chair Fowler closed the public hearing
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COMMENT AND DISCUSSION
5.Agenda Forecast – Principal Planner Tyler Corey provided an update of upcoming
projects.
ADJOURNMENT
The meeting was adjourned at 8:03 p.m. The next Regular meeting o f the Planning Commission
is scheduled for Wednesday, June 13, 2018 at 6:00 p.m., in the location, 990 Palm Street, San
Luis Obispo, California.
APPROVED BY THE ADVISORY BODY NAME: 06/13/2018
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San Luis Ranch Specific Plan Amendment Overview
This document summarizes the proposed San Luis Ranch Specific Plan Amendment. Following this
introductory text, the pages that follow include those pages from the Specific Plan that are amended from
the adopted version. Table 1 at the end of this introduction summarizes the differences. Following that,
the original pages from the adopted plan are included so the reader can compare the two documents. All
other pages from the previously adopted Specific Plan remain unchanged as a result of this action.
The development potential under the San Luis Ranch Specific Plan would remain unchanged from what
was approved in July 2017. However, development of each of the project phases could now overlap, be
out of sequence, or be concurrent, depending on market conditions and to adjust to project conditions
and/or mitigation measures to implement the adjusted phasing plan. The pace of residential and
commercial development would still be subject to limitations set forth in the Specific Plan and
Development Agreement for the project, and subject to the City’s Growth Management regulations. The
applicant’s requirement to pay its fair share contribution to the Prado Road Interchange project will
remain in effect, with construction currently scheduled to begin in 2021.
In addition, the revised project includes an amendment to the Specific Plan to permit the Community
Development Director to authorize the developer, in any given year, to construct 50% more of the units
allocated to the project in the following year if the Director determines that doing so is necessary to
facilitate construction of beneficial public facilities and infrastructure. The purpose of this authorization
is to realize the public benefits associated with the project, mitigate known potential impacts resulting
from the project, and implement development requirements, including infrastructure requirements,
which the City has found to be consistent with the requirements of the City’s Growth Management
Ordinance. Under no circumstances though can the number of units constructed exceed the City’s Growth
Management Ordinance.
The portions of the approved Specific Plan that relate to phasing and the timing of development and
related improvements have been modified to reflect the changes described above.
The substantive changes are primarily in Chapter 7, where Section 7.7 through the end of that Chapter
have been updated to reflect the phasing flexibility discussed in the Supplemental EIR (SEIR).
These changes include: (i) adding phasing flexibility language as well as the Growth Management
language to Section 7.7.1 Build Out, (ii) changing the triggers in Table 7-9 San Luis Ranch Performance
Triggers to uses rather than phases, (iii) changing the dates in Table 7-10 San Luis Ranch Residential Build-
Out and Table 7-11 San Luis Ranch Non-Residential Build-Out from specific years to proposed build out
years, (iv) correcting a typographical error in Table 7.10 by flipping the proposed number of Dwelling Units
to be constructed in years 1 and 2, (v) deleting the remainder of Chapter 7 because those items are now
included in the Development Agreement, and (vi) updating Appendix B Mitigation Measures to Address
Class I Impacts to include the Mitigation Measures included in the Final SEIR. Note that changes to
Appendix B will be made after the certification of the Final SEIR, in the event that either the Planning
Commission or City Council choose to modify the language included in those mitigation measures.
There were also additional changes made in the remainder of the Specific Plan to delete any references
to specific phases or years, in order to make the document internally consistent.
Table 1 provides additional detail regarding these changes, with comparative references to the adopted
document to show how it will be amended. Amended pages from the adopted Specific Plan are included
following this introductory overview.
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Table 1. Summary of Specific Plan Amendment
Item Adopted Specific Plan (July 18, 2017) Specific Plan Amendment (June 28, 2018)
1 Page 4-4. Section 4.2. Agriculture. Page 4-4. There
are several references to project phasing.
Page 4-4. Section 4.2. Agriculture. Page 4-4. Modified to
eliminate references to phasing.
2 Page 6-10. Section 6.5. Neighborhood Traffic
Management Program. There is a reference to
“Phase 1” of development.
Page 6-10. Section 6.5. Neighborhood Traffic
Management Program. Reference modified to “during the
beginning of project construction.”
3 Page 6-16. Section 6.7.2.A. Prado Road Connection.
Page 6-16. Includes the following sentence: “Phased
construction of full interchange is required per T-1(c)
and T-8 (d-f).”
Page 6-15. Section 6.7.2.A. Prado Road Connection. Page
6-15. This sentence is deleted.
4 Pages 7-20 and 7-21. Section 7.6. Performance
Triggers. Includes multiple references to phasing,
and that the timing of certain roadway
improvements is tied to particular project phases.
Also includes Table 7-9, San Luis Ranch Build-Out
Phasing Plan, which summarizes these triggers by
phase. There is also Table 7-7, which is a phasing
map showing Phases 1-6.
Pages 7-20 and 7-21. Section 7.6. Performance Triggers.
Section fundamentally re-written to eliminate references
to phasing, and instead connect certain infrastructure
needs to particular development components, regardless
of the order they are developed. Table 7-9, San Luis
Ranch Build-Out Phasing Plan, which focused on
roadways, is eliminated, and replaced with a new Table 7-
9, San Luis Ranch Performance Triggers, which covers a
variety of infrastructure. Figure 7-7 is eliminated, since
there are no longer Phases 1-6. New Section 7.6.1,
Construction of Improvements, is added, summarizing
that the timing of improvements is included in the
Development Agreement for the project.
5 Page 7-22. Section 7.7. Phasing Strategy. Includes
Table 7-10, Phasing Strategy, which shows
infrastructure improvements by phase.
This section is eliminated, and Table 7-10 is modified and
included as Table 7-9, San Luis Ranch Performance
Triggers.
6 Pages 7-23 to 7-25. Section 7.8. Financing Strategy.
Includes Table 7-11 through 7-15 and supporting text
that detail financing strategies by phase, including
funding mechanisms. Tables 7-11 and 7-12 show
residential and non-residential phasing by calendar
year, starting in 2018.
Page 7-21. Section 7.7. Financing Strategy. This section is
fundamentally re-written and greatly streamlined,
eliminating references to phasing, and allowing more
flexibility with regard to the order or development and
how much could occur per year within the confines of the
City’s Growth Management Ordinance. Tables 7-10 and
7-11 (formerly 7-11 and 7-12) now show residential and
non-residential development in the context of sequential
years, rather than a calendar start date of 2018. Section
7.7.2, Funding Mechanisms, refer to the Public Facilities
Financing Plan in the Development Agreement, rather
than a series of hypothetical mechanisms as was included
in the adopted Specific Plan. Tables 7-13 and 7-14 from
the adopted Specific Plan, which showed improvement
cost estimates, are eliminated, since this information is
more accurately captured in fee structures within the
Development Agreement.
7 Page 7-26. Section 7.9, Financing Implementation
and Administration. Includes references to various
funding mechanisms, including a PFFP, CFD, and
EIFD, as well as descriptions of impact fees, and how
these programs could be administered.
This section is eliminated in the Specific Plan Amendment,
since the Development Agreement includes all funding
and financing mechanisms necessary to implement the
project, including direction on how such mechanisms are
administered.
8 Appendix B. Includes all mitigation measures that
apply to the Specific Plan, based on the certified Final
EIR.
Appendix B. Updates this list of mitigation measures to
reflect those in the Final SEIR, some of which are new, and
others of which have been modified from the certified
Final EIR. Appendix B is not included at this time, but will
be updated following certification of the Final SEIR.
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Specific Plan Amendment
Pages that Changed as a result of the SPA
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4-4 SAN LUIS RANCH | SPECIFIC PLAN | City of San Luis Obispo, CA | July 18, 2017 Adopted | August **, 2018 Revised
4.2 Agriculture
Dating back to the turn of the 20th century, the Dalidio
Ranch included a collection of structures: the Dalidio
home, Laguna Racetrack viewing stand, barn, water tower,
and other buildings supporting the farming of the ranch.
Some buildings within the complex, most notably the
Dalidio home and the Laguna Racetrack viewing stand,
may be considered historically significant based on State
and local criteria and guidelines, and “Historic evaluation
of the existing farm house and associated structures shall
be included” as required by the General Plan’s Land Use
Element (Section 8.3 p. 105).
Three potentially historically significant buildings in
the area, the Dalidio Home, the White Barn, and the
Laguna Race Track Viewing Stand will be relocated to
the Agricultural Heritage and Learning Center area for
permanent preservation. All will be subject to historic
documentation by a qualified historian prior to relocating,
including being photographed and recorded consistent
with professional historical standards, and a qualified
historic preservation architect will be consulted during
relocation planning to ensure that significant historic
materials and fabric are retained and reconstructed
appropriately. Materials from outbuildings will be reused
and incorporated as feasible onto other structures within
the agricultural heritage center. The associated structures
in the area will also similarly be photographed and
recorded before they are moved from or repurposed on
the site.
The Agricultural Heritage Facilities and Learning Center
will be a destination for residents and tourists alike and
will provide the community with local food, education,
and a connection to agriculture. The Agricultural Heritage
Facilities and Learning Center will include the following:
Heritage
Preservation of Historic Structures
Iconic Barn Feature
Historic Architectural Ambiance
Bucolic Vistas of Agriculture and Barn Setting
Amenities
Agricultural Heritage Facilities and Learning Center
Market/Farm Stands
Community Garden
Hay Rides
Pumpkin Patch
Agricultural Processing Center
Farm Animals
Fresh Produce Baskets
Locally Made Goods/Products
Agricultural Events
Seasonal and Special Events
Hoedowns with live music
Learning Activities
Community Gatherings
The Agricultural Heritage Center will include the historic
Dalidio home, along with the Racetrack Viewing Stand
Barn and Main (White) Barn, arranged on the site with
their original solar orientation and relative proximity to
one another. This recreated setting will allow residents
and visitors to experience the working farm as it operated
in decades past.
The three existing historically significant structures will
continue to be secured in their current area of the site.
These three structures will be relocated (repositioned)
to the Agricultural Heritage Learning Center on the site,
under the supervision of the project historic preservation
architect, once grading and infrastructure improvements
are completed on the Agricultural Heritage Learning
Center parcel. All three structures will be restored and
repurposed and will be operational at the time of approval
of occupancy of the final residential detached units.
In addition to the agricultural and seasonal events, the
barn at San Luis Ranch will be available to host private
events including, hoe downs, family reunions, business
gatherings, and other community gatherings. The
Agricultural Heritage Facilities and Learning Center will
be closed on Thursdays to avoid competition with the
Downtown farmer’s market and will work with the Saturday
farmer’s market on cross promotional opportunities.
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6-10 SAN LUIS RANCH | SPECIFIC PLAN | City of San Luis Obispo, CA | July 18, 2017 Adopted | August **, 2018 Revised
6.5 Neighborhood Traffic
Management Program
A Neighborhood Traffic Management (NTM) program
addresses methods of enhancing pedestrian flows,
slowing vehicular speeds, reducing traffic volumes, and
ensuring an efficient transportation network. The City of
San Luis Obispo is currently undertaking a series of NTM
programs to address observed traffic issues throughout
the City. The San Luis Ranch NTM strategies incorporate
elements of these plans. Moreover, because of less retail
development proposed in San Luis Ranch, San Luis Ranch
will generate less traffic volume than would be realized
under existing entitlements.
Pedestrian crosswalks and streetscape amenities are a
key component to enhancing pedestrian safety through
NTM.
The intent for pedestrian facilities in the San Luis
Ranch Specific Plan is outlined in Section 6.4. Other key
components of NTM are the slowing of traffic speeds and
reduction of traffic volumes. Traffic calming measures
undertaken in the San Luis Ranch Specific Plan Area are to
be considered where traffic volumes and speeds exceed
maximum levels, as established in Policy 8.1.3 of the City’s
Circulation Element. Froom Ranch Way and the completion
of its connecting bridge to the driveway of Dick’s Sporting
Goods during the beginning of project construction will
alleviate some traffic concerns of the proposed street
pattern. However, it may be of specific concern in regards
to the existing street pattern, as it could serve San Luis
Ranch neighborhood residents in addition to Prado Road
connection traffic. San Luis Ranch Specific Plan Area traffic
demand management measures shall be coordinated
with the City of San Luis Obispo Public Works Department.
A range of traffic control strategies for San Luis Ranch
Specific Plan residential streets are identified below.
Traffic Control Strategies in San Luis Ranch
Narrow Drive Lanes: Reducing the width of streets can be an effective strategy for reducing traffic speeds in a
neighborhood environment. Residential road typologies with a road width of less than 20’ have been shown to have
substantial fewer collisions and slower traffic.
Speed & Warning Signs: A comprehensive speed and warning signage program works to calm traffic and slow
speeds. This can raise driver awareness of surroundings, provide a tool to meter and calm traffic (as in the case of
crossing beacons, Rapid Rectangular Flashing Beacons, and digital speed feedback devices), and serve as a directional
tool.
Turn Restriction Signs: Signage that limits turning movements allows for directional control of traffic and
neighborhood diversion. This can help alleviate neighborhood congestion and direct heavier volumes to local
collectors and arterials, thereby liming neighborhood cut-through traffic.
Roundabouts: Roundabouts can serve as a traffic-calming feature in areas that have a need for traffic calming but do
not require formal stop control. Roundabouts slow traffic speeds and provide an opportunity for plantings, seating,
and play-based activities.
Speed Humps: Speed humps or tabletops serve as tools to reduce traffic speeds and increase safety in the
neighborhood environment. They decrease speed at critical junctions or crossings and allow for pedestrians to be at
eye level with auto traffic. They should be used strategically to maximize benefit.
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SAN LUIS RANCH | SPECIFIC PLAN | City of San Luis Obispo, CA | July 18, 2017 Adopted | August **, 2018 Revised 6-15
Figure 6.19 Example 20-foot Alley
6.6.4 Alleys
Alleys provide rear access to some of the smaller lots in San Luis Ranch. Figure 6.19 shows potential configurations of 15
and 20 foot wide alleys.
6.7 Summary of Supportive
Interface with Adjacent Streets and
Paths
The street network within the San Luis Ranch Specific
Plan Area provides access to nearby neighborhoods and
commercial centers through connections with adjacent
streets and paths.
Chapter 4.12 of the project EIR lists many of the required
traffic improvements that aim to maintain adequate levels
of service within and outside of the project boundaries.
Several of the required improvements are listed in
this Section. For a full description of traffic mitigation
measures, see Appendix B.
6.7.1 Bicycle Pedestrian Pathway
Connections
The San Luis Ranch Specific Plan will provide a key
connection of the Bob Jones Bicycle Trail. By implementing
a key link of the Bob Jones Trail, the San Luis Ranch
Specific Plan contributes to the regional effort to connect
downtown San Luis Obispo to Avila Beach. The Specific
Plan Area also contains interior bicycle trails and lanes
including a Class II lane that connects to the future Class I
Bike Lanes along the Prado Road overcrossing, and Class
I Bike Lanes on Froom Ranch Way and through the active
linear park. These facilities are consistent with the goals
and objectives outlined in San Luis Obispo’s 2013 Bicycle
Transportation Plan and increase connections for the
City’s existing bicycle transportation network. See section
6.2.1 for additional details on San Luis Ranch bicycle
and pedestrian pathway connections to the surrounding
circulation network.
6.7.2 Integration with Existing Street
Network
The San Luis Ranch Specific Plan Area looks to
accommodate traffic generated by future residents and
businesses, while simultaneously enhancing the City’s
existing street network and area mobility.
All farm access will be via Calle Joaquin and will be in
conformance with the Calle Joaquin Agricultural Plan.
6.7.2 A Prado Road Connection
The construction of an overcrossing from the San Luis
Ranch site across U.S. Highway 101 via an overpass will
connect to the existing section of Prado Road on the east
side of the freeway. This overpass will serve the expanded
commercial and residential development of San Luis Ranch
and will provide an additional east-west connection in San
Luis Obispo that would reduce congestion at the Los Osos
Valley Road and Madonna Road interchanges and route
traffic to and from the Airport Area via the Prado Road
connection. The overpass will also have a Class I Bike
Lane. This improvement would be constructed as a future
project independent of development under the Specific
Plan, and development under the Specific Plan would pay
a fair share contribution to the future construction.
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7-20 SAN LUIS RANCH | SPECIFIC PLAN | City of San Luis Obispo, CA | July 18, 2017 Adopted | August **, 2018 Revised
7.6 Performance Triggers
In addition to the utility infrastructure discussed in
Section 7.2, various other roadway improvements are
necessitated to support San Luis Ranch Specific Plan
Area build-out and implement the City’s General Plan.
The transportation improvements will be constructed to
match the development sequencing and accommodate
the forecasted traffic volumes. Many of the transportation
impacts to local roads are mitigated through the
construction of the Prado Road / US Hwy 101 overcrossing
and interchange.
See Chapter 6 for more information on the circulation
system and street cross sections.
Table 7-9 San Luis Ranch Performance Triggers
Use Circulation Water Wastewater Storm Drain Recycled Water
NG-10
Construct Dalidio
from Madonna to
Froom Ranch and
Froom Ranch to
Prefumo Creek
bridge
Timing of Bridge
TBD
Construct SLO
Ranch Way to Froom
Construct 12” line
from corner of
Dalidio/Froom to
connection in west
of Prefumo creek.
Install 10” from
Madonna to Froom.
Install 8” lines within
SFD(NG-10)
Install 8” lines in
SLO Ranch Rd.,
Froom from SLO
Ranch to 24” line
and 8” lines within
residential area
Install underground
detention in
commercial area.
Install underground
retention area in
neighborhood park
and pocket park
near Froom Ranch
bridge
Install vegetated
retention areas
Channel & creek
widening full length
of channel, and
from confluence of
channel to Froom
bridge
Install 6” line in
SLO Ranch Rd.
from Madonna to
Froom
NG-23
Construct Dalidio
from Madonna to
Froom Ranch and
Froom Ranch to
Prefumo Creek
bridge
Funding Mechanism
for Prado Road
Overpass/
Interchange
SLO Ranch Way to
Froom
Connect to 10” line
in SLO Ranch Rd.
Loop 8”lines within
30x80 lots (NG-23)
Install 8” lines
internally
connecting from
SLO Ranch Rd.
NG-30
Madonna
Improvements/
Internal roads
Connect to 10” line
in SLO Ranch Rd.
or connect to 12”
line in Froom for AG
Heritage Center
Connect to 8” line in
SLO Ranch Rd.
On-site surface
retention or
underground
detention, as
needed
Vegetated bioswales
(pervious pavers,
grass crete parking,
etc)
Connect to 6” line
in SLO Ranch Rd.
for Multi-family
Hotel Internal only Connect to 12” line
in Froom
Connect 8” line
in Froom Rd./
SLO Ranch Rd.
to Dalidio/Froom
intersection
Underground
stormwater
detention and
vegetated bioswales
as needed
Install 6” line
from SLO Ranch
Rd. / Froom to
Froom/Dalidio
intersection
Office
Obtain access
easement from
Madonna Shopping
center owner
Connect to 12” line
in Froom
Retail
Dalidio/Prado
extension/overpass
timing TBD
Connect from
Harvest Street
to existing line in
Dalidio Drive
Packet Page 165
SAN LUIS RANCH | SPECIFIC PLAN | City of San Luis Obispo, CA | July 18, 2017 Adopted | August **, 2018 Revised 7-21
7.6.1 Construction of Improvements
The Development Agreement requires Subdividers to
construct certain improvements in addition to those
“in-tract” improvements required pursuant to the
subdivision map(s). Subdivider shall construct and convey
to City identified infrastructure and community facilities
concurrently with development of the discrete uses of the
Project to be served by each infrastructure element or
community facility.
7.7 Financing Strategy – Required
Facilities
The San Luis Ranch Development Agreement provides
a Public Facilities Financing Plan (PFFP), and outlines a
funding strategy to enact the PFFP. The PFFP will outline
construction and maintenance costs for required facilities
and services that would be impacted by the project. The
PFFP also presents strategies for bond and other public
financing options.
7.7.1 Build-Out
Tables 7-10 and 7-11 outline a conceptual residential
and commercial build out scenario by year, respectively,
in terms of dwelling units, square footage, and acreages.
These conceptual plans are intended to provide short
and long-term goals over a multi-year period; however,
the actual development of the project could overlap, be
out of sequence, or be concurrent, depending on market
conditions (i.e., development identified to occur in a
particular year could be advanced to occur in an earlier year
or development that does not occur in any given year(s) may
be carried over into a later year(s)). Such development has
been determined to be consistent with the City’s General
Plan and Growth Management Ordinance and represents
the maximum total development contemplated under the
Specific Plan at full buildout; though, actual buildout may
occur at a lower level, depending on market conditions.
The Community Development Director may authorize the
developer, in any given year, to also allow the construction
of up to 50% of the units allocated to the project in the
following year if the Director determines that doing so is
necessary to facilitate construction of beneficial public
facilities and infrastructure. The purpose of this authorization
is to realize the public benefits associated with the project,
mitigate known potential impacts resulting from the project,
and implement development requirements, including
infrastructure requirements, which the City has found to be
consistent with, and not a waiver of, the requirements of
the City’s Growth Management Ordinance.
7.7.2 Funding Mechanisms
The Development Agreement includes a Public Facilities
Financing Plan (PFFP) and lays out the funding mechanisms
to implement the Financing Plan.
The PFFP outlined in the Development Agreement may be
amended separately, without amending the Specific Plan.
Year Dwelling Units Acres
1 196 8.0
2 86 15
3 175 15
4 123 4.0
Total 580 42
Table 7-10 San Luis Ranch Residential Build-Out
Year
Commercial Office Hotel + Conference Center
Square Feet Acres Square Feet Acres Rooms Acres
1 50,000 4.00
2 50,000 4.00 25,000 1.05 200 3.50
3 50,000 4.00 25,000 1.05
4 25,000 1.05
5
6 25,000 1.05
7
Total 150,000 12.00 100,000 4.20 200 3.50
Table 7-11 San Luis Ranch Non-Residential Build-Out
Packet Page 166
Originally Adopted Specific Plan – July 2017
Original Pages to be Changed through the SPA
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4-4 SAN LUIS RANCH | SPECIFIC PLAN | City of San Luis Obispo, CA | May 2017 Public Hearing Draft
4.2 Agriculture
Dating back to the turn of the 20th century, the Dalidio
Ranch included a collection of structures: the Dalidio
home, Laguna Racetrack viewing stand, barn, water tower,
and other buildings supporting the farming of the ranch.
Some buildings within the complex, most notably the
Dalidio home and the Laguna Racetrack viewing stand,
may be considered historically significant based on State
and local criteria and guidelines, and “Historic evaluation
of the existing farm house and associated structures shall
be included” as required by the General Plan’s Land Use
Element (Section 8.3 p. 105).
Three potentially historically significant buildings in the
area, the Dalidio Home and the Laguna Race Track Viewing
Stand, will be relocated to the Agricultural Heritage
and Learning Center area for permanent preservation.
Both will be subject to historic documentation by a
qualified historian prior to relocating, including being
photographed and recorded consistent with professional
historical standards, and a qualified historic preservation
architect will be consulted during relocation planning to
ensure that significant historic materials and fabric are
retained and reconstructed appropriately. Materials from
the barn will be reused and incorporated as feasible onto
other structures within the agricultural heritage center.
The associated structures in the area will also similarly be
photographed and recorded before they are moved from
or repurposed on the site.
The Agricultural Heritage Facilities and Learning Center
will be a destination for residents and tourists alike and
will provide the community with local food, education,
and a connection to agriculture. The Agricultural Heritage
Facilities and Learning Center may include the following:
Heritage
Preservation of Historic Structures
Iconic Barn Feature
Historic Architectural Ambiance
Bucolic Vistas of Agriculture and Barn Setting
Amenities
Agricultural Heritage Facilities and Learning Center
Market/Farm Stands
Community Garden
Hay Rides
Pumpkin Patch
Agricultural Processing Center
Farm Animals
Fresh Produce Baskets
Locally Made Goods/Products
Agricultural Events
Seasonal and Special Events
Hoedowns with live music
Learning Activities
Community Gatherings
The Agricultural Heritage Center will include the historic
Dalidio home, along with the Viewing Stand Bar and
Main Bar, arranged on the site with their original solar
orientation and relative proximity to one another. This
recreated setting will allow visitors to experience the
working farm as it operated in decades past.
The three existing historically significant structures
will be secured in their current location during Phase I
construction. These three structures will be relocated
(repositioned) to the Agricultural Heritage Learning Center
on the site, under the supervision of the project historic
preservation architect, restored and repurposed during
Phase II construction. All components of the Agricultural
Heritage Learning Center will be operational at the time of
Phase II residential occupancy.
In addition to the agricultural and seasonal events, the
barn at San Luis Ranch will be available to host private
events including, hoe downs, family reunions, business
gatherings, and other community gatherings. The
Agricultural Heritage Facilities and Learning Center will
be closed on Thursdays to avoid competition with the
Downtown farmer’s market and will work with the Saturday
farmer’s market on cross promotional opportunities.
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6-10 SAN LUIS RANCH | SPECIFIC PLAN | City of San Luis Obispo, CA | May 2017 Public Hearing Draft
6.5 Neighborhood Traffic
Management Program
A Neighborhood Traffic Management (NTM) program
addresses methods of enhancing pedestrian flows,
slowing vehicular speeds, reducing traffic volumes, and
ensuring an efficient transportation network. The City of
San Luis Obispo is currently undertaking a series of NTM
programs to address observed traffic issues throughout
the City. The San Luis Ranch NTM strategies incorporate
elements of these plans. Moreover, because of less retail
development proposed in San Luis Ranch, San Luis Ranch
will generate less traffic volume than would be realized
under existing entitlements.
Pedestrian crosswalks and streetscape amenities are a
key component to enhancing pedestrian safety through
NTM.
The intent for pedestrian facilities in the San Luis
Ranch Specific Plan is outlined in Section 6.4. Other key
components of NTM are the slowing of traffic speeds and
reduction of traffic volumes. Traffic calming measures
undertaken in the San Luis Ranch Specific Plan Area are to
be considered where traffic volumes and speeds exceed
maximum levels, as established in Policy 8.1.3 of the City’s
Circulation Element. Froom Ranch Way and the completion
of its connecting bridge to the driveway of Dick’s Sporting
Goods during Phase 1 will alleviate some traffic concerns
of the proposed street pattern. However, it may be of
specific concern in regards to the existing street pattern,
as it could serve San Luis Ranch neighborhood residents
in addition to Prado Road connection traffic. San Luis
Ranch Specific Plan Area traffic demand management
measures shall be coordinated with the City of San Luis
Obispo Public Works Department. A range of traffic control
strategies for San Luis Ranch Specific Plan residential
streets are identified below.
Traffic Control Strategies in San Luis Ranch
Narrow Drive Lanes: Reducing the width of streets can be an effective strategy for reducing traffic speeds in a
neighborhood environment. Residential road typologies with a road width of less than 20’ have been shown to have
substantial fewer collisions and slower traffic.
Speed & Warning Signs: A comprehensive speed and warning signage program works to calm traffic and slow speeds.
This can raise driver awareness of surroundings, provide a tool to meter and calm traffic (as in the case of crossing
beacons, Rapid Rectangular Flashing Beacons, and digital speed feedback devices), and serve as a directional tool.
Turn Restriction Signs: Signage that limits turning movements allows for directional control of traffic and neighborhood
diversion. This can help alleviate neighborhood congestion and direct heavier volumes to local collectors and arterials,
thereby liming neighborhood cut-through traffic.
Roundabouts: Roundabouts can serve as a traffic-calming feature in areas that have a need for traffic calming but do
not require formal stop control. Roundabouts slow traffic speeds and provide an opportunity for plantings, seating, and
play-based activities.
Speed Humps: Speed humps or tabletops serve as tools to reduce traffic speeds and increase safety in the neighborhood
environment. They decrease speed at critical junctions or crossings and allow for pedestrians to be at eye level with auto
traffic. They should be used strategically to maximize benefit.
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6-16 SAN LUIS RANCH | SPECIFIC PLAN | City of San Luis Obispo, CA | May 2017 Public Hearing Draft
6.7.2 A Prado Road Connection
The construction of an overcrossing from the San Luis
Ranch site across U.S. Highway 101 via an overpass will
connect to the existing section of Prado Road on the east
side of the freeway. Phased construction of full interchange
is required per T-1(c) and T-8 (d-f). This overpass will serve
the expanded commercial and residential development
of San Luis Ranch and will provide an additional east-
west connection in San Luis Obispo that would reduce
congestion at the Los Osos Valley Road and Madonna
Road interchanges and route traffic to and from the
Airport Area via the Prado Road connection. The overpass
will also have a Class I Bike Lane. This improvement would
be constructed as a future project after the Specific Plan
is developed, and the Specific Plan would pay a fair share
contribution to the future construction.
6.7.2 B Froom Ranch Way
The San Luis Ranch Specific Plan will also provide a
connection to Froom Ranch Way to enable access from
Los Osos Valley Road to San Luis Ranch and Prado Road.
The Froom Ranch Way connection will meet regional traffic
needs by providing a connection between commercial
centers while not bifurcating on-site or neighborhood
agricultural lands. It is planned as a two-lane collection
with turn lanes, a median, sidewalk, parkways, and a Class
I bicycle path.
The Froom Ranch Way bridge includes a new 2-lane
bridge over Prefumo Creek to connect the Froom Ranch
Way extension on the San Luis Ranch site to the existing
roadway section located south of the creek. This bridge
will provide a connection between the Specific Plan and
Los Osos Valley Road.
6.7.2 C Dalidio Road Improvements
The existing segment of Dalidio Drive south of Madonna
Road includes two northbound lanes and two southbound
lanes until the first access driveway that serves the Central
Coast Plaza Shopping Center, at which point the road
narrows to two lanes in accordance with traffic mitigation
measures from the EIR. Dalidio Drive will require widening
to its planned 4-lane arterial width from this point
easterly through the Specific Plan Area. Additionally, the
intersection at Madonna Road and Dalidio Drive will be
expanded to accommodate the added traffic, as required
by the City.
6.7.2 D Madonna Road Improvements
The existing segment of Madonna Road adjacent to the
Specific Plan contains two eastbound and two westbound
lanes. A right-in and right-out connection with acceleration
and deceleration lanes will be provided on this section of
Madonna Road to serve the residential units. This segment
will require widening to match the segments east and west
of the Specific Plan and provide curb, gutter and sidewalk
along the project’s frontage.
6.7.2 E Traffic Signal Improvements
The additional traffic will require modifications to the
Dalidio/Madonna Road intersection to implement dual
westbound left turns.
6.7.2 F Emergency Access Easement
The San Luis Ranch Specific Plan Area development will
also include an offer of dedication for a 20’ Emergency
Access Easement between Froom Ranch Way and Calle
Joaquin, and shall not bifurcate on-site or neighboring
agricultural lands.
6.7.2 G Roundabouts
San Luis Ranch may, as appropriate, explore the use of
roundabouts when connecting to the existing and planned
City roadway network. Specifically, a multilane roundabout
will be added on Dalidio Drive when appropriate.
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7.6 Performance Triggers
In addition to the utility infrastructure discussed in
Section 7.2, various other roadway improvements are
necessitated to support San Luis Ranch Specific Plan
Area build-out and implement the City’s General Plan.
The transportation improvements will be constructed in
a phased manner to match the development sequencing
and accommodate the forecasted traffic volumes. Many
of the transportation impacts to local roads are mitigated
through the construction of the Prado Road / US Hwy 101
overcrossing and interchange.
Table 7-9 lists the anticipated development phases or
triggers and the major transportation infrastructure
improvements associated with each phase. Although
bicycle and pedestrian facilities are not listed, those are
included with each phase of development. See Figure 7.7
for an illustration of the phases.
See Chapter 6 for more information on the circulation
system and street cross sections.
Froom Ranch Way Connection and Bridge: The Froom
Ranch Way extension includes a new 2-lane bridge over
Prefumo Creek and 2-lane collector road with Class I Bike
Lane connecting the existing roadway section on the south
side of Prefumo Creek and extending to the Prado Road
connection on the north. This improvement will provide a
vital connection between the Specific Plan area and Los
Osos Valley Road The bridge and roadway link is required
in the first residential phases of the project. See mitigation
measure T-5 Froom Ranch Way Bridge Phasing.
Madonna Road Improvements: The existing segment
of Madonna Road adjacent to the Specific Plan contains
two eastbound and two westbound lanes. A right-in and
right-out connection with acceleration and deceleration
lanes and a left-in will be provided in Phase 3 on this
section of Madonna Road to serve the high density
residential units. This segment will require widening to
match the segments east and west of the Specific Plan
and provide bike lanes, curb, gutter and sidewalk along
the project’s frontage. Installation and extension of turn
pockets at Dalidio Drive will occur in the first phase.
Dalidio Road Improvements: The existing segment
of Dalidio Drive south of Madonna Road includes two
northbound lanes and two southbound lanes until the
first access driveway that serves the Central Coast Plaza
Shopping Center, at which point the road narrows
to two lanes (one in each direction). Dalidio Drive will
require widening to its planned 4-lane arterial width
from this point through the Specific Plan Area. This
improvement would be required in the first phase of
residential development.
T-4(a). Construction Traffic Management Plan. Prior to
construction, a traffic management plan shall be prepared
for review and approval by the City of San Luis Obispo
Public Works Department. The traffic management plan
shall be based on the type of roadway traffic conditions,
duration of construction, physical constraints, nearness
of the work zone to traffic and other facilities (bicycle,
pedestrian, driveway access, etc.)
Table 7-9 San Luis Ranch Build-Out Phasing Plan
Phase/Trigger Improvement
Phase 1 – Residential (large lot)
Dalidio Drive widening, Froom Ranch Way Extension
and Bridge, Froom Ranch Way / Dalidio Drive Signal or
Roundabout, Madonna Road / Dalidio Drive intersection
improvements
Phase 2–Residential (small lot)Funding mechanism established for Prado Road
Overpass and reconfigured North Bound Ramps
Phase 3 – High Density Residential and Agricultural Heritage
Center Madonna Road Widening and Frontage Improvements
Phase 4 – Commercial (Hotel)Froom Ranch Road / Dalidio Drive Traffic Signal or
Roundabout Improvements
Phases 5 and 6 – Commercial (Office and Retail)Transit Hub at Retail Center
After Specific Plan Build-Out Prado Road –Install Southbound Ramps to US 101
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SAN LUIS RANCH | SPECIFIC PLAN | City of San Luis Obispo, CA | May 2017 Public Hearing Draft 7-21
Prado Road/U.S. Highway 101 Overpass/Interchange:
This improvement would extend Prado Road as a 4-lane
arterial with a Class I Bike Lane from the San Luis Ranch
site across U.S. Highway 101 via an overpass and
connect to the existing section of Prado Road on the
east side of the freeway. The existing northbound ramps
would be reconfigured as part of the overpass. For this
improvement, an approved funding plan will be in place
prior to occupancy of Phase 2 units. A southbound ramp
will be constructed after buildout of the Specific Plan, at
a time deemed necessary by the City. The Specific Plan
would pay a fair share contribution to this regional
improvement.
Figure 7.7 Phase/Trigger for Infrastructure Improvements
PHASE 2 (FUNDING MECHANISM ONLY)
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7-22 SAN LUIS RANCH | SPECIFIC PLAN | City of San Luis Obispo, CA | May 2017 Public Hearing Draft
7.7 Phasing Strategy
Phase Circulation Water Wastewater Storm Drain Recycled Water
1
Contruct Dalidio
from Madonna to
Froom Ranch and
Froom Ranch to
Prefumo Creek
bridge
Timing of Bridge
TBD
Construct SLO
Ranch Way to Froom
Construct 12” line
from corner of
Dalidio/Froom to
connection in west
of performo creek.
Install 10” from
Madonna to Froom.
Install 8” lines within
SFD(NG-10)
Install 8” lines in
SLO Ranch Road,
Froom from SLO
Ranch to 24” line
and 8” lines within
residential area
Install underground
detention in
commercial area.
Install underground
retention area in
neighborhood park
and pocket park
near Froom Ranch
bridge
Install vegetated
retention areas
Channel & creek
widening full length
of channel, and
from confluence of
channel to Froom
bridge
Install 6” line in
SLO Ranch Rd from
Madonna to Froom
2
Contruct Dalidio
from Madonna to
Froom Ranch and
Froom Ranch to
Prefumo Creek
bridge
Funding Mechanism
for Prado Road
Overpass/
Interchange
SLO Ranch Way to
Froom
Connect to 10” line
in SLO Ranch Rd.
Loop 8”lines within
30x80 lots (NG-23)
Install 8” lines
internally
connecting from
SLO Ranch Road
3
Madonna
Improvements/
Internal roads
Connect to 10” line
in SLO Ranch Rd.
or connect to 12”
line in Froom for AG
Heritage Center
Connect to 8” line in
SLO Ranch Road
On-site surface
retention or
underground
detention, as
needed.
Vegetated bioswales
(pervious pavers,
grass crete parking,
etc)
Connect to 6” line
in SLO Ranch Rd for
Multi-family
4 Internal only Connect to 12” line
in Froom
Connect 8” line
in Froom Road/
SLO Ranch Road
to Daladio/Froom
intersection
Underground
stormwater
detention and
vegetated bioswales
as needed
Install 6” line from
SLO Ranch Road /
Froom to Froom/
Dalidio intersection
5
Obtain access
easement from
Madonna Shopping
center owner
Connect to 12” line
in Froom
6
Dalidio/Prado
extension/overpass
timing TBD
Connect from
Harvest Street
to existing line in
Dalidio Drive
Table 7-10 San Luis Ranch Phasing Strategy
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SAN LUIS RANCH | SPECIFIC PLAN | City of San Luis Obispo, CA | May 2017 Public Hearing Draft 7-23
7.8 Financing Strategy – Required
Facilities
The San Luis Ranch Specific Plan provides a Public Facilities
Financing Plan (PFFP), and outlines a funding strategy to
enact the PFFP. The PFFP will outline construction and
maintenance costs for required facilities and services that
would be impacted by the project. The PFFP also presents
strategies for bond and other public financing options.
7.8.1 Public Facilities Financing Plan (PFFP)
Build-Out and Phasing
Figure 7.7 shows a map of the phasing plan. Tables 7-11
and 7-12 outline the proposed residential and commercial
build out by year, respectively, in terms of dwelling units,
square footage, and acreage. These tables show maximum
allowable buildout under the City’s General Plan. Actual
buildout may be lower, but not less than the minimum
required by the General Plan. The actual residential
product mix at buildout will be determined by market
conditions.
Year Dwelling Units Acres
2018 86 8.0
2019 196 15
2020 175 15
2021 123 4.0
Total 580 42
Table 7-11 San Luis Ranch Residential Build-Out Phasing Plan
Year
Commercial Office Hotel + Conference Center
Square Feet Acres Square Feet Acres Rooms Acres
2018 50,000 4.00
2019 50,000 4.00 25,000 1.05 200 3.50
2020 50,000 4.00 25,000 1.05
2021 25,000 1.05
2022
2023 25,000 1.05
2024
Total 150,000 12.00 100,000 4.20 200 3.50
Table 7-12 San Luis Ranch Non-Residential Build-Out Phasing
Cost Estimates
The total cost of transportation and backbone utility
infrastructure associated with San Luis Ranch Specific Plan
build-out is estimated to be approximately $28.8 million
(See Table 7-13). The $28.8 million figure is not inclusive
of land acquisition associated with roadway infrastructure
improvements, existing development impact fees (school,
City, or other), on-site stormwater management, or in-
tract improvements that project developers will assume
as their projects are constructed.
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7-24 SAN LUIS RANCH | SPECIFIC PLAN | City of San Luis Obispo, CA | May 2017 Public Hearing Draft
Table 7-13 San Luis Ranch Improvement Projects Estimated Costs + Triggers
Improvement Project Estimated Cost Trigger
Froom Ranch Way Extension $1,900,000 Phases 1 and 2 (Residential)
Madonna Road Improvements $500,000 Phases 1 and 2 (Residential)
Utility Infrastructure (1)$1,015,000 Phases 1 and 2 (Residential)
Prado Road Extension - U.S.
101(2)$22,450,000 Subject to approved funding plan, prior to
occupancy of Phase 2 units
Dalidio Drive Improvements $2,000,000 Phase 3 (Commercial)
Traffic Signal Improvements $170,000 Phase 3 (Commercial)
Froom Ranch Way Bridge $800,000 Phase 3 (Commercial)
Total $28,835,000
1. Wastewater, Water, and Recycled Water Backbone Infrastructure Shown in Figure 7.1, 7.2, and 7.3.
2. Cost estimate assumes overcrossing of U.S. 101 with no interchange. San Luis Ranch will only pay its fair-share
portion of the Prado Road extension cost.
Funding Mechanisms
This section outlines key funding sources that would
finance key infrastructure elements of the San Luis Ranch
Specific Plan Area. These funding sources are organized
into two groups:
1.Primary funding mechanisms (Community
Financing District (CFD) and Enhanced
Infrastructure Financing District (EIFD)) will
generate the primary funds necessary to complete
the improvement projects described above.
2.Ancillary funding mechanisms (Development
Agreements, Development Impact Fees, and
Developer Financing) will generate funds necessary
to cover the costs to administer primary funding
sources and other infrastructure projects as
needed.
Cost Allocation
As mentioned above, the primary funding mechanisms
for infrastructure improvements are Community Facilities
District (CFD) and Enhanced Infrastructure Financing
District (EIFD). Table 7-14 shows how bonds could be
issued across three phases to finance the infrastructure
accordingly. It is anticipated that San Luis Ranch will pay
its fair share of these improvements.
In order to reduce construction noise levels during each
phase of development, various noise mitigation measures
have been identified. The key noise mitigation measures
to be implemented prior to and/or during construction
include:
• N-1(a). Utilizing haul routes that avoid residential
neighborhoods;
• N-1(b). Limiting construction work hours between
the hours of 7:00am to 7:00pm daily; and
• N-1(c) Construction Best Management Practices
(BMP’s) and noise attenuation techniques.
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SAN LUIS RANCH | SPECIFIC PLAN | City of San Luis Obispo, CA | May 2017 Public Hearing Draft 7-25
Table 7-14 San Luis Ranch Improvement Projects Cost Allocation by Bond Financing Phase
Improvement Project Estimated Cost
Bond Financing
First Issuance Second Issuance Third Issuance
Froom Ranch Way Extension $1,900,000 $1,900,000
Madonna Road Improvements $500,000 $500,000
Utility Infrastructure (1)$1,015,000 $1,015,000
Dalidio Drive Improvements $2,000,000 $2,000,000
Traffic Signal Improvements $170,000 $170,000
Froom Ranch Way Bridge $800,000 $800,000
Prado Road Extension - U.S. 101 (2)$22,450,000 $22,450,000
Total $28,835,000 $3,415,000 $2,970,000 $22,450,000
1. Wastewater, Water, and Recycled Water Backbone Infrastructure Shown in Figure 8.1, 8.2, and 8.3.
2. Cost estimate assumes overcrossing of U.S. 101 with no interchange. San Luis Ranch will only pay its fair-share
portion of the Prado Road extension cost.
7.8.2 Funding Mechanisms
This Section provides information on primary and ancillary
funding mechanisms.
Primary Funding Mechanisms
Community Facilities Districts: A Community Facilities
District (CFD) is a special district created pursuant to
the Mello-Roos Community Facilities Act (California
Government Code Section 53311 et seq.) to finance public
infrastructure and service projects through levying of a
special tax on property in the district. Public bonds can be
issued based on the revenue stream from the special tax.
As a primary funding mechanism, a CFD may provide for
the purchase, construction, expansion, or rehabilitation
of any real or other tangible property with an estimated
useful life of at least five years. Creation and administration
of a CFD are discussed in Section 7.6 above.
Enhanced Infrastructure Financing District: An
Enhanced Infrastructure Financing District (EIFD) is a
new funding mechanism that was approved by the State
of California in 2014. An EIFD can finance public capital
facilities or other specified projects of communitywide
significance. An EIFD is a special district that may be
created within a city or county, and is established upon
approval by 55 percent of voters. The legislative body of
the participating entities governs the EIFD. An EIFD can
issue public bonds based on tax-increment financing to
fund identified projects that may include the construction
or rehabilitation of a wide variety of public infrastructure
and facility projects such as parking, transit facilities,
sewage treatment, parks, recreational facilities, open
space and libraries.
The State legislature is expected to further refine technical
issues related to EIFDs in 2015.
Ancillary Funding Mechanisms
City and County Tax Exchange: Under Revenue and
Taxation Code Section 99, a county may upon annexation
enter into an agreement with a city to share property taxes
that would be spent towards improvements, services, etc.
in the annexed area.
It is envisioned that the City of San Luis Obispo and the
County of San Luis Obispo will work together to develop a
fair and equitable approach to the sharing of incremental
increases in real property ad valorem taxes imposed and
collected as authorized by the Revenue and Taxation
Code in order to encourage sound urban development
and economic growth.
Development Agreements: A development agreement
is a tool for establishing a vested right to proceed with
development in conformance with the policies, rules, and
regulations in effect at the time of approval (Government
Code Section 65864). Development agreements provide
a developer with assurances for a specified length of
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time that the proposed project may proceed as originally
approved, and not be affected by future changes in land
use regulations. In exchange for this assurance, the
landowner/developer may agree to public improvements,
land dedications, or in-lieu fees, as negotiated with the City,
as a condition of the agreement.
Development Impact Fees: Allowed under Government
Code Section 66000 et seq., development impact fees
are payments from new developments required by local
governments to offset the cost of improving or expanding
City facilities to accommodate the development. To establish
the appropriate fee amount, a jurisdiction determines
the specific improvements to be funded and prepares a
“nexus” study to demonstrate the relationship between the
proposed improvements and new development.
Table 7-15 shows the projected impact fees that will
be generated from San Luis Ranch Specific Plan Area
development. Development impact fees could be offset
with credits for sustainable development practices or use of
on-site resources such as water wells if deemed appropriate
by the City.
Developer Financing: In many cases, developers fund
facilities or dedicate land as a means of mitigating the
impact of their developments. For example, the City may
impose, as a condition of development, construction of a
facility that is needed, such as a roadway. Once the roadway
is constructed and accepted by the City, fee credits equal
to the amount of the cost of the facility or the cost of the
facility as estimated in the capital improvement plan, can be
issued to the developer. The developer can then apply them
to offset fees imposed on his development or enter into a
fair share reimbursement agreement for any constructed
facility that is oversized.
Landscaping and Lighting District: The Landscaping and
Lighting District of 1972 (California Streets and Highways
Code §§ 22500, et seq.) allows local agencies to establish a
Landscaping and Lighting District to finance landscaping and
lighting in public areas as well as construction of community
centers and acquisition of parks. An assessment is charged
to each property owner in the district based on a formula
calculating the degree of benefit derived by the property
owner. Landscaping and Lighting Districts are subject to the
voting and notice requirements of Proposition 218.
Homeownership Association Fees: Homeownership
Association (HOA) fees may be used to fund maintenance
for parks if the parks are considered part of the HOA
common area.
7.9 Financing Implementation and
Administration
The San Luis Ranch Specific Plan Area will be built across
phases as outlined in Section 7.8. Changes in required
facility design and cost estimates might result. The PFFP
and City finance policies are designed to accommodate
such changes while securing in-place public bond financing.
7.9.1 Updates and Revisions to the PFFP
The PFFP should be updated each time there is a significant
change in facility plans, land use plans, or infrastructure
cost estimates. When these items are revised, there will be
a corresponding change in the fair share cost allocation to
each type of land use anticipated within the San Luis Ranch
Specific Plan Area. Impact fees within the development
must also be adjusted to maintain a nexus between facilities
being funded and land uses paying such fees.
7.9.2 Individual Project Applications and
Developer Reimbursements
When an individual project is submitted to the City for
processing and approval, the facilities required to serve that
project must be identified. Due to the incremental nature
of public facility phasing, it is likely that certain projects will
be required to oversize improvements to accommodate
future development. By comparing the project’s assigned
fair share of facility costs to the costs of improvements
required to allow the project to proceed, the City will be
able to calculate an equitable reimbursement to the
developer paying for oversized improvements. The City will
likely enter into an agreement with the developer to affect
such a reimbursement.
7.9.3 Capital Facility Account(s) for Collected
Fees
Pursuant to Section 66006 of the California Government
Code, the City will establish a capital facility account(s) for
collected fees. Establishment of this account(s) will prevent
commingling of the fees with other City revenues and funds.
Interest income earned by fee revenues in these accounts
will be deposited in the accounts and applied to facility
construction costs. Within one hundred eighty days of the
close of each fiscal year, the City will make information
pertaining to each account (as required by Section 66006
(b)(1)) available to the public and will review this information
at a regularly scheduled public hearing.
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SAN LUIS RANCH | SPECIFIC PLAN | City of San Luis Obispo, CA | May 2017 Public Hearing Draft 7-27
Avg.
SF
Unit
Count Total SF
Other
Mea-
sure
Impact Fees Fee Calculation
Amount Per Per SF Per Unit Total
TRANSPORTATION IMPACT + PLAN PREPARATION FEES
Residential,
Single-family 1,814 300 544,200 Unit $1.94 $3,519.16 $1,055,748.00
Residential,
Multi-family 1,296 280 362,880 Unit $2.41 $3,123.36 $874,540.80
Office 100,000 SF $7.05 $705,000.00
Service Com-
mercial 150,000 SF $3.82 $573,000.00
Hotel/Motel 200 $1,632.00 Unit $1,632.00 $326,400.00
Total $3,534,688.80
WATER DEVELOPMENT IMPACT FEE
Residential,
Single-family 1,814 300 544,200 $10,775.16 Unit $5.94 $10,775.16 $3,232,548.00
Residential,
Multi-family 1,296 280 362,880 $7,542.72 Unit $5.82 $7,542.72 $2,111,961.60
Office 100,000 TBD
Service Com-
mercial 150,000 TBD
Hotel/Motel 200 4” meter $179,934.00 4” meter $179,934.00
Total $5,524,443.60
WASTEWATER DEVELOPMENT IMPACT FEE
Residential,
Single-family 1,814 300 544,200 $3,736.84 Unit $2.06 $3,736.84 $1,121,052.00
Residential,
Multi-family 1,296 280 362,880 $2,604.96 Unit $2.01 $2,604.96 $729,388.80
Office 100,000 TBD
Service Com-
mercial 150,000 TBD
Hotel/Motel 200 4” meter $62,621.00 4” meter $313.11 $62,621.00
Total $1,913,061.80
SCHOOL IMPACT FEES
Residential,
Single-family 1,814 300 544,200 SF $3.36 $6,095.04 $1,828,512.00
Residential,
Multi-family 1,296 280 362,880 SF $3.36 $4,354.56 $1,219,276.80
Office 100,000 SF $0.54 $54,000.00
Service Com-
mercial 150,000 SF $0.54 $81,000.00
Hotel/Motel 200 TBD
Total $3,182,788.80
Table 7-15 Summary of Impact Fees Estimated from San Luis Ranch Development
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7.9.4 City Ordinances Enabling Impact Fees
For impact fees not already codified by the City, the
City Council could adopt an ordinance enabling impact
fees within the Specific Plan Area. Such impact fees may
include transportation and water connection surcharges
similar to those that have been assessed in other Specific
Plan Areas of the City of San Luis Obispo.
7.9.5 Creation and Administration of a CFD
Formation of the CFD may be initiated by any one of the
following methods: (1) motion by the City Council, (2) a
written request signed by two City Council members, (3)
a petition signed by 10 percent of the registered voters
or in the proposed CFD, or (4) a petitioned signed by
property owners accounting for 10 percent of the land
in the proposed CFD. Within 90 days of initiating the
proceedings, the City Council adopts a resolution of intent
to establish the CFD. In not less than 30 days and not
more than 90 days from adoption of the resolution, the
City Council will hold a public hearing on the formation
of the CFD. Finally, as required by Proposition 13, the
special tax must be approved by two-thirds of registered
voters in the proposed CFD. However, if there are fewer
than 12 registered voters residing in the proposed district,
the vote shall be by the landowners of the proposed CFD,
and each landowner shall have one vote for each acre or
portion of an acre of land owned within the CFD.
Formation of a Community Facilities District commits the
City to the ongoing administration of the CFD. A Mello-
Roos special tax is not a fixed lien on a parcel, but an
annual lien that must be calculated and levied each year.
The appropriate special tax will be determined by the City
or its designee after consideration of annual debt service
requirements, direct construction funding, administrative
costs of the CFD, prepayments received, and development
activity within the CFD. After the special taxes have been
calculated each fiscal year, they will be submitted to the
county auditor to be included on the secured property tax
bill.
7.9.6 Forming an EIFD
Enhanced Infrastructure Financing Districts (EFIDs) are a
relatively new public financing mechanism (established
in Government Code Sections 553398.50, et seq.
effective January 1, 2015). Unlike other public financing
mechanisms under California law, EIFDs may be formed
by resolution of the city council without an accompanying
public vote. To issue bonds, however, an EIFD must hold
a vote and garner at least 55 percent of voter approval
for the issuance. Before adopting a resolution forming
an EIFD, the city council must publish the proposed EIFD
infrastructure financing plan, notice all landowners and
affected taxing entities, and hold a public hearing. Further,
a city that in the past created a redevelopment agency
(as defined by Health and Safety Code Section 33003)
may not initiate formation of an EIFD until the former
redevelopment agency is adequately concluded pursuant
to Government Code Section 53398.54.
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