HomeMy WebLinkAbout06-18-2019 Item 09 - Parkland Dedication Reimbursement Agreement for the Righetti Ranch Subdivision in the Orcutt Area
Department Name: Community Development
Cost Center: 4001
For Agenda of: June 18, 2019
Placement: Consent
Estimated Time: N/A
FROM: Shelly Stanwyck, Assistant City Manager – Community Services
Prepared By: Michael Codron, Community Development Director
SUBJECT: PARKLAND DEDICATION REIMBURSEMENT AGREEMENT FOR THE
RIGHETTI RANCH SUBDIVISION IN THE ORCUTT AREA
RECOMMENDATION
Authorize the Mayor to execute a reimbursement agreement (Attachment A) as requested by the
developers of the Righetti Ranch Subdivision in consideration of their dedication of 11.46 acres
of parkland to the City, which is most of the parkland needed to serve build-out of the Orcutt
Area Specific Plan.
DISCUSSION
Background
The Orcutt Area Specific Plan covers over 200 acres of land north of Tank Farm Road, east of
the railroad tracks, and south and west of Orcutt Road. This area is governed by the Orcutt Area
Specific Plan (OASP), which includes standards for neighborhood design and lot sizes in new
subdivisions. In total, approximately 1,000 units are planned for this area.
The OASP also includes a Public Facilities Financing Plan (PFFP) to ensure that new
development pays its fair share of the costs of facilities needed to serve the area. An updated
PFFP was approved by the City Council in November 2016, and the PFFP was updated with
information specific to parkland in December 2017 (Attachment B).
One of the requirements of the OASP and PFFP is dedication of parkland to ensure that enough
parkland is provided to serve the future residents of the Orcutt Area. Righetti Ranch is the largest
subdivision in the Orcutt Area, and includes the site identified as the Neighborhood Park within
the OASP, as well as a linear park and pocket parks (Attachment C). A condition of approval of
the Righetti Ranch subdivision required the upfront dedication of 11.46 acres of parkland, which
was accomplished when the first phase of the subdivision was recorded in April 2018.
As other subdivisions and developments in the Orcutt Area move forward, the parkland fee
established as part of the PFFP will be collected by the City. Because the City already acquired
the parkland when the Righetti Ranch subdivision was recorded, the funds collected may be
reimbursed to Ambient Communities.
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Previous Council Review
The City Council has recently reviewed the overall fee program for the Orcutt Area, and the
Parkland In-Lieu Fee requirements.
• November 15, 2016 – City Council approval of a comprehensive update of the OASP PFFP,
including new cost estimates for transportation improvements.
• December 12, 2017 – Update of the OASP PFFP to correct the Parkland In-Lieu Fee by
separating the land acquisition costs from the park construction costs that are covered by a
separate fee.
• October 16, 2018 – Update of the OASP PFFP following approval of the Citywide Impact
Fee Program update.
Parkland fees are based on area of development, per the following table. No cost changes are
proposed or recommended.
Parkland In-Lieu Fee
2017/18 Fiscal Year Fee Rates
Property
Parklands
Acquisition In-Lieu
Fee
Single-Family
Residential Fee
Multi-Family
Residential Fee
Pratt 1 – 024 $307,132 $0 $5,866
Pratt 2 – 007 $457,905 $0 $5,866
Taylor-Muick $707,181 $5,914 $4,400
West Creek $816,966 $5,914 $4,400
Anderson $322,488 $0 $4,400
Evans $335,053 $0 $4,400
Farrior $33,505 $0 $4,400
Fiala $22,520 $5,914 $0
Hall $46,070 $0 $4,400
Imel $95,710 $5,914 $0
Jones $395,472 $7,885 $5,866
Totals $3,540,000
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Policy Context
The proposed reimbursement agreement is consistent with and implements key City policies for
infrastructure financing, parkland requirements, and costs of growth. Fundamentally, the
proposed reimbursement agreement is a method to implement Parks and Recreation Element
Policy 3.13.1, which follows.
The reimbursement agreement is consistent with re-imbursement principles reflected in the
City’s Subdivision Regulations, specifically Municipal Code Sections 16.22.040 through
16.22.100, inclusively and is within the Council’s authority to effectuate the requirements of the
OASP and its PFFP.
Public Engagement
The City has been working directly with Righetti Ranch on the proposed reimbursement
agreement, which is a mechanism for reimbursing the developer for the parkland that was
dedicated to the City as part of the first phase of the Righetti Ranch subdivision. The City has
performed a substantial amount of public engagement with Orcutt Area property owners and area
residents during the development of the OASP, as well as during recent updates to the PFFP in
2016, 2017 and 2018. No fees or costs associated with development of property in the OASP are
changing as a result of the recommended reimbursement agreement.
CONCURRENCE
The City’s Community Development, Parks and Recreation and Finance Departments have
reviewed this staff report and concur with its recommendation.
ENVIRONMENTAL REVIEW
The approval of a reimbursement agreement related to an adopted fee structure covering
development impacts in the Orcutt Planning Area is exempt from CEQA and covered by the
general rule that CEQA applies only to projects which have the potential for causing a potential
effect on the environment. Where it can be seen with certainty that there is no possibility that the
activity in question may have a significant effect on the environment, the activity is not subject
to CEQA.
The approval of a reimbursement agreement does not have any potential to cause significant
effects on the environment and the general rule CEQA 15061 (b) (3) exemption applies because
all projects included within the fee program have been subject to prior CEQA review in
conjunction with plan adoption and/or specific project approvals and there are no changes to
previously studied projects proposed. Additionally, if this was a project under CEQA it would be
Categorically Exempt under 15273 (a) (4) (Rates, Tolls, Fares, and Charges). Obtaining funds
for capital projects, necessary to maintain service within existing services areas are exempt from
CEQA.
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FISCAL IMPACT
Budgeted: NA Budget Year: 2019-20
Funding Identified: NA
The project does not have a fiscal impact on the City. The City plays an important role by
ensuring that parkland is dedicated in sufficient amounts for the use of future residents,
consistent with the policies and programs identified in the OASP and General Plan. The
proposed reimbursement agreement allows the City to reimburse the developer for the cost of
land dedicated in excess of the Righetti Ranch fair-share parkland requirements.
ALTERNATIVES
1. Continue consideration of this item. The City Council may continue consideration of the
recommendation if more information is needed to make a decision. Direction should be
provided to staff regarding the additional analysis or data needed for the Council to
conclude the item.
2. Deny the request. The City Council may deny the request for a reimbursement
agreement. This action is not recommended because a reimbursement agreement is the
best method to ensure that the developer is reimbursed for the cost of parkland that is
beyond the fair share requirement for the Righetti Ranch subdivision.
Attachments:
a - Draft Parkland Reimbursement Agreement
b - Resolution Approving 2017 Parkland Fee Update
c - Neighborhood Park Schematic Design
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PARK LAND DEDICATION REIMBURSEMENT AGREEMENT
(Righetti Ranch -Vesting Tentative Map 3063)
This Park Land Reimbursement Agreement (“Agreement”) is entered into this _____ day
of June, 2019 (the “Effective Date”), by and between the CITY of San Luis Obispo, a municipal
corporation and charter city (“CITY”) and Righetti Ranch L.P., a Delaware limited partnership
(“DEVELOPER”). The CITY and DEVELOPER are sometimes hereinafter referred to
individually as a “party” and collectively as “parties.”
RECITALS
WHEREAS, DEVELOPER is currently developing a residential project in the CITY of
San Luis Obispo, California, pursuant to approved Vesting Tentative Tract Map 3063 and the Final
approved and recorded 3063 Phase 1 Tract Map for property known as the “Righetti Ranch”. The
development of Righetti Ranch referred to hereinafter as the “Project”;
WHEREAS, the Project is subject to conditions of approval of the Vesting Tentative Map,
the Orcutt Area Specific Plan (“OASP”), the OASP’s Public Facilities Financing Plan (“OASP
PFFP”) and the OASP’s Final Environmental Impact Report (“FEIR”);
WHEREAS, the conditions of approval of the OASP and the Project require
DEVELOPER to dedicate sufficient land to the CITY for the eventual development of public
parks, which satisfies the parkland requirements for the Project and for the entire OASP area (the
“Dedicated Land”);
WHEREAS, under the OASP PFFP, 11.46 acres of the Dedicated Land identified in
Exhibit “A” attached hereto (the “Parkland”) were dedicated to the CITY on April 9th 2018 at
8:00 AM as part of the recordation of the Map. Exhibit “B” attached hereto identifies the Parkland
dedicated and eligible for reimbursement, and Exhibit “C” identifies the benefitting properties
other than the Project (hereinafter, the “Benefitted Properties”).
WHEREAS, the value of the Parkland was determined in 2009 with the approval of the
OASP PFFP and CITY and DEVELOPER have agreed to a reimbursement value of three-hundred
thousand dollars per acre ($300,000/acre) for the Parkland per the PFFP.
WHEREAS, DEVELOPER and the City have agreed that DEVELOPER shall be
reimbursed an amount of three million four hundred and thirty-eight thousand dollars ($3,438,000)
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($300,000 * 11.46=$3,438,000) from the owners of the Benefitted Properties at the recordation of
their final subdivision map or at building permit, depending on when the fee is collected
(“Reimbursement Amount”).
AGREEMENT
NOW THEREFORE, for valuable consideration, the receipt of which is hereby acknowledged,
the parties hereto hereby agree as follows:
1. Recitals. The above recitals are true and correct. The recitals set forth above, and all
defined terms set forth in such recitals and in the preamble preceding the recitals, are
hereby incorporated into this Agreement as though set forth in full.
2. Term. This Agreement shall expire upon June __, 2034 (the “Term”); provided,
however, if by the end of the Term of this Agreement, DEVELOPER has not received
all of the Reimbursement Amount, as may be adjusted and as validated pursuant to the
terms of this Agreement, City will in good faith consider entering into a new agreement
for the purpose of completing reimbursement of funds collected for parkland
acquisition purposes.
3. Reimbursement. Subject to the terms and conditions hereof, CITY shall promptly
collect funds from all Benefitted Properties at the recordation of their subdivision map
or building permit for those developments that do not include a subdivision. The
amount collected from each Benefitting Property is defined in the 2018 update to the
OASP PFFP, Appendix A, table 9. Exhibit “D” copy attached hereto (the
“Reimbursement Payments”).
If any owner or developer of one or more of the Benefitted Properties pays all or a
portion of the Reimbursement Payments under protest, CITY shall not be required to
make reimbursements under this Agreement until the limitation period for instituting
court action to seek a refund of such funds paid under protest has passed, and no court
action has been instituted ("Action"). If an Action is instituted seeking refund of funds
paid under protest or to prevent CITY from collecting such funds, or otherwise
challenging any right or obligation of the CITY or DEVELOPER under the terms of
this Agreement, CITY shall notify DEVELOPER, in writing, of the Action. Thereafter,
DEVELOPER shall defend, indemnify, and hold harmless the City or its agents,
officers, or employees from any claim, action, or proceeding against the City or its
agents, officers, or employees, to attack, set aside, void, or annul, in whole or in part,
the City's approval of this Agreement. In the event that the City fails to promptly notify
the DEVELOPER of any such claim, action, or proceeding, or that the City fails to
cooperate fully in the DEVELOPER’s defense of said claim, this condition shall
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thereafter be of no further force or effect. CITY agrees that it shall support all of
DEVEOLOPER’s efforts in the Action. CITY shall not reimburse such funds to
DEVELOPER until the Action has been finalized and the authority of CITY to collect
such funds and reimburse DEVELOPER has been sustained. Nothing herein is intended
to or shall obligate the CITY to pay to DEVELOPER any amount in excess of fees
actually collected from the Benefitted Properties or fees collected related to any
development of properties other than the Benefitted Properties.
4. Timing of Reimbursement/ Payment/Interest The CITY shall reimburse DEVELOPER
for all Reimbursement Payments collected by the CITY quarterly beginning on July 1,
2019. All reimbursements shall be by check or warrant made payable to: Righetti
Ranch LP, a Delaware limited partnership and mailed to: C/O Ambient Communities
179 Calle Magdalena, Suite 201, Encinitas, CA 92024.
5. Collection of Parkland Fees in Excess of the Reimbursement Amount If the CITY
collects Parkland Fees pursuant to the OASP PFFP in excess of the Reimbursement
Amount, as may be adjusted and as validated pursuant to the terms of this Agreement,
then the CITY shall apply the excess Parkland Fees collected to fund park
improvements as specified under the Quimby Act.
6. Entire Agreement/Amendment. This Agreement represents the entire integrated
agreement between the CITY and DEVELOPER regarding reimbursement for the
Excess Public Improvements, and supersedes all prior negotiations, representations or
agreements, either written or oral. This Agreement may be amended only by a written
instrument signed by both CITY and DEVELOPER.
7. Governing Law and Venue. The interpretation and implementation of this Agreement
shall be governed by the law of California, except for those provisions preempted by
federal law. However, the laws of the State of California shall not be applied to the
extent that they would require or allow the court to use the laws of another state or
jurisdiction. The parties agree that all actions or proceeding arising in connection with
the Agreement shall be tried and litigated only in the County of San Luis Obispo or the
United States District Court for the Central District of California.
8. Severability. Invalidation of any provision contained herein or the application thereof
to any person or entity by judgment or court order shall in no way affect any of the
other covenants, conditions, restrictions, or provisions hereof, or the application thereof
to any other person or entity, and the same shall remain in full force and effect.
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9. Counterparts. This Agreement may be executed in two (2) or more counterparts, each
of which shall be deemed an original and all of which together shall constitute one and
the same instrument.
10. Notices. All notices, demands, invoices, or written communications to the parties
required or permitted hereunder shall be in writing and delivered personally or by U.S.
mail, postage prepaid, to the following addresses or such other address as the parties
may designate in accordance with this section:
CITY Director Public Works
919 Palm Street
San Luis Obispo, CA 93401
With a copy to: CITY Attorney
990 Palm Street
San Luis Obispo, CA 93401
DEVELOPER Righetti Ranch, L.P.
979 Osos Street, Suite E
San Luis Obispo, CA 93401
Attn: Travis Fuentez
Phone: (805) 573-0401
Ambient Communities
179 Calle Magdalena, Suite 201
Encinitas, CA 92024
Attn: Rob Anselmo
Phone: (619) 890-2349
11. Interpretation/Ambiguity. This Agreement negotiated by the Parties, with the advice
and assistance of their respective counsel, and shall not be construed in favor of or
against either Party, regardless of who may have drafted it or any of its terms. Any rule
of construction to the effect that ambiguities are to be resolved against the drafting
party shall not be applied in interpreting this Agreement.
12. Assignment. DEVELOPER shall not assign, transfer or convey any of its rights, duties
or obligations under this Agreement without the prior written approval of CITY. CITY
shall not unreasonably withhold approval of any assignment. Any other assignment
shall be null and void.
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13. Authority to Execute. Both CITY and DEVELOPER do covenant that each individual
executing this agreement on behalf of each party is a person duly authorized and
empowered to execute Agreements for such party.
[Signatures on following page]
IN WITNESS WHEREOF, the parties have executed this Agreement as of the first date written
above.
ATTEST:
______________________________
Teresa Purrington, CITY Clerk
APPROVED AS TO FORM:
________________________________
J. Christine Dietrick, CITY Attorney
CITY OF SAN LUIS OBISPO, a
municipal corporation and charter city
_____________________________
Heidi Harmon, Mayor
DEVELOPER
Righetti Ranch, LP
A Delaware Limited partnership
By: NRE Manager, LLC,
a Delaware limited liability company
Its: General Partner
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By: Ambient Righetti Manager, LLC,
A California limited liability company
Its: Sole member
By: ____________________________
Travis Fuentez, President
By: ____________________________
Dante Anselmo, Vice-President
APPROVED AS TO FORM FOR
DEVELOPER
____________________________
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EXHIBIT A
PARKLAND
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EXHIBIT B
PARKLAND MAP SHEET
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EXHIBIT C
BENEFITED PROPERTIES
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EXHIBIT D
REIMBURSEMENT PAYMENTS
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RESOLUTION NO. 10850 (2017 SERIES)
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
SAN LUIS OBISPO, CALIFORNIA, APPROVING CORRECTIONS TO THE
ORCUTT AREA SPECIFIC PLAN PARK FEES
WHEREAS, in 2010 the City Council adopted the Orcutt Area Specific Plan (OASP) that
included a Public Facilities Financing Plan (PFFP) that established a program for providing public
parks within the OASP Planning Area; and
WHEREAS, the OASP and PFFP established a program of centralizing public parks on the
property known as the Righetti Ranch site, for the use and benefit the entire plan area; and
WHEREAS, by centralizing parks on one property, the OASP established a program of
requiring other owners within the OASP to contribute "in -lieu" fees to cover a fair share contribution
to Parklands Acquisition on the Righetti site; and
WHEREAS, the 2010 OASP and PFFP set fees for each property within the plan area, and
called for the periodic update of those fees; and
WHEREAS, in 2016, the City Council updated the PFFP, and following that action an error
in the formula for calculating Parklands Acquisition In -Lieu Fees was discovered that did not
equitably spread the full cost of in -lieu fee reimbursements over all benefitting OASP properties; and
WHEREAS, corrections to the Parklands Acquisition In -Lieu Fee formula to properly
allocate those fair share contributions to each benefitting property is appropriate and timely; and
WHEREAS, the existing fee structure for the OASP combines both the Parklands
Acquisition In -Lieu Fee and the Park Improvement Fee into a single fee, which inhibits the ability
to accurately manage fee credits due developers when they dedicate parkland and/or build park
improvements within their respective subdivisions.
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo
as follows:
SECTION 1. Continued Findings. The corrections to the Orcutt Area Specific Plan (OASP)
Parklands Fees are based on the City Council making the following continued findings:
A) The purpose for the OASP Parklands Fees are to establish an equitable method of
sharing the costs of (i) acquiring lands for public parks within the GASP, and (ii) providing a
mechanism for improvement of those public parks in a manner consistent with the City General Plan,
Parks and Recreation Element and the OASP detailed planning policies for the Plan Area. Because
there are multiple ownerships within the GASP, locating public parklands in the appropriate locations
did not necessarily follow discrete property ownerships, instead placing the burden for providing
public parks in areas that were disproportionate to land ownership patterns. Effectively, one property
owner (Righetti Ranch) was burdened with providing nearly all the public parklands for the entire
GASP. To reconcile the inequity of locating public parks largely on a single site, a program for
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Resolution No. 10850 (2017 Series) Page 2
collecting a fair share of the costs of those lands spread across all OASP owners became the
Parklands Acquisition In -Lieu Fee" due for any and all developing properties within the GASP.
Addressing an equitable method for improving these public parks, a fee for the construction of the
public parks was codified as the "Parkland Improvement Fee".
B) The use of the fees is twofold. The "Acquisition Fee" was established to compensate
the owners of the Righetti site for public park lands they set aside above and beyond their project's
fair share demands, to provide those additional lands for use by other owners within the OASP area,
and to alleviate the land area dedications for parks otherwise required on individual sites, freeing up
those areas for residential and/or commercial development in furtherance of the goals of the OASP.
The "Improvement Fee" is collected from all developing properties and used by the City to fund the
construction of the project improvements.
C) There is a continued need for the improvements and there is a reasonable relationship
between the fee and the demand for public parks created by new residential development and the
provision of those lands and improvements within the OASP area based on established City policy.
Specifically, the OASP establishes 16.5 acres of public parks that are subject to this Fee program, and
anticipates another —4 acres of public park space located within the OASP area. The "Acquisition"
and "Improvement" Fees referenced herein and under the OASP are directed at completing the 16.5
acres called for as public parks in the Plan Area.
D) The sources and amounts of funding anticipated to complete the financing of the
improvements have been identified and will be deposited into the appropriate account upon receipt
and used to fund such improvements.
SECTION 2. The modifications to Table 9 of the Public Facilities Financing Plan and Orcutt
Area Specific Plan as set forth in Exhibit "A" attached hereto and incorporated herein, are hereby
approved.
SECTION 3. The Community Development Director is authorized to administer and
implement these fees as provided therein.
SECTION 4. The Mayor and City staff are authorized to take action necessary to carry out
the intent of this resolution.
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SECTION 5. Environmental Review. The Orcutt Area Specific Plan (OASP) and an
associated Final Environmental Impact Report (FEIR) were approved and certified in March 2010.
Implementation of the Public Facilities Financing Plan (PFFP), including actions such as the 2016
Update of the PFFP, were anticipated as mitigation measures to secure needed infrastructure in
supporting orderly growth in the OASP Planning Area. In this case the corrections to Table 9 are
consistent with these earlier CEQA determinations and is statutorily exempt pursuant to Section
15273 of the CEQA Guidelines. Therefore, no further environmental review is required.
Upon motion of Council Member Pease, seconded by Vice Mayor Christianson,
and on the following roll call vote:
AYES: Council Members Gomez, Rivoire and Pease,
Vice Mayor Christianson and Mayor Harmon
NOES: None
ABSENT: None
The foregoing resolution was adopted this 12`h day of December 2017.
May r H di Harmon
ATTEST:
Carrie Gallagher
City Clerk
AS
ine Dietrick
City Attorney
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City
of San Luis Obispo, California, this day of , C24D ) 4.
Carrie Gallagher
City Clerk
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Resolution No. 10850 (2017 Series)
EXHIBIT A
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ORCUTT AREA SPECIFIC PLAN
2 Conservation, Open Space and Recreation
March 2010 2-13 City of San Luis Obispo
FIGURE 2.5 NEIGHBORHOOD PARK PLAN
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