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HomeMy WebLinkAbout02-19-2013 ph2 margarita area impact fee credit agreement for prado extensioncounci l aqenOa aepont Mating Dam 2/19/1 3 m~m ..PH 2 • C I T Y O F S A N L U I S O B I S P O FROM : Derek Johnson, Community Development Directo r Daryl Grigsby, Public Works Directo r Prepared by : Derek Johnson, Community Development Directo r Tim Bochum, Deputy Director, Public Work s SUBJECT : MARGARITA AREA IMPACT FEE CREDIT AGREEMEN T FOR PRADO ROAD EXTENSIO N RECOMMENDATION 1.Approve a Reimbursement and Impact Fee Credit Agreement with Rescal LLC . for the purpose of reimbursing and crediting costs for the construction and oversizing of Prad o Road improvements consistent with the Margarita Area Specific Plan and Resolution No . 9776 and the corresponding conditions of Vesting Tentative Tract Map No . 2342 . 2.Approve a Resolution authorizing the Finance and Information Technology Director t o cause an interfund loan for the purposes of constructing a portion of Prado Road . REPORT IN BRIE F This item requests City Council approval of a Reimbursement and Impact Fee Credit Agreemen t ("Agreement") and to authorize the Finance and Information Technology Director to cause a n interfund loan . Constructing Prado Road is the first critical step to realizing the land uses , circulation, and economic benefits associated with the build out of the Margarita Area Specifi c Plan ("MASP"). Without Prado Road, development cannot occur, and the circulation an d economic benefits will not be realized by the community . The MASP was adopted in 2004 at the acme of the development boom . The MASP assumed a coordinated, consistent, and comprehensive approach to public and private facilities . Three vesting tract maps were approved in 2005 (known as the "western enclave") and it was expecte d that development would advance eastward . For a variety of reasons, including the economi c recession, the coordinated approach to development never occurred and two properties (formerl y Cowan and Deblauw) were eventually acquired by a new development team, Rescal LLC . Rescal has been in frequent communications with City staff since doing its due diligence on th e property . The focus has been how to comply with the Prado Road conditions of approval . Specifically, the question has been how to construct the western portion of Prado Road pursuant to conditions of approval that were established under a different economic climate an d development market . The cost of building this portion of Prado Road exceeds the fair share responsibility of the approved subdivisions . Therefore, Rescal must spend far more money t o complete portions of Prado Road than is their fair share in the MASP transportation fees . Thu s they have expressed concern about the timing associated with reimbursement for the wor k PH2-1 through fee payments from other development in the MASP . In order to understand the financia l challenges and options associated with constructing the western portion and eventually the entir e Prado Road facility, a comprehensive reimbursement, fiscal and economic analysis was prepare d by Goodwin Consulting Group ("Goodwin"). Goodwin assisted the City in preparing th e original public facilities financing plan and was uniquely qualified to take on the task . The reimbursement analysis compares the costs of extending Prado Road from its existing terminus to Broad Street, which will be constructed by MASP developers . In addition, i t compares those costs to the transportation and park (citywide and MASP area specific) impac t fee obligations associated with future development within the MASP area . The repor t specifically focuses on the advanced cost requirements and reimbursement needs of th e residential components of tracts 2342 and 2353 . The analysis, which is based on market rat e representations of the developer, shows that fee credits and early reimbursement help advanc e the project but are not necessary for the Reseal project to be financially feasible . This conclusio n leads to the proposed reimbursement agreement, and staff is recommending the use of MAS P Park fees to do early reimbursement as the park funds are not immediately needed . Consequently, the proposed interfund loan will help the project advance and also provide a greater investment return than the funds remaining in the developer impact fee fund . There is a substantial capital outlay of Tract 2342 to build the first segment of the Prado Roa d extension – approximately $2,120,250 . This amount is slightly lower than the construction cos t estimate used in the Goodwin report since the developer has now obtained bids from thei r contractor and they believe the costs of the improvements for Segment A will be a little less tha n those used in the report. The report determined that the allocated Fair Share of Prad o Improvements for VTTM 2342 is $731,643 and specifically $432,452 for the residentia l component of the tract . The Report also identified the cost of the initial phase of Prado Roa d (Segment A) to be constructed by Developer are significantly in excess of that Fair Share . As an inducement for Developer to construct desired improvements in excess of its fair share, staf f concludes it is appropriate to accelerate repayment to Developer through the allocation of MAS P Park impact fee credits from VTTM Nos . 2342, and from MASP Transportation fees other residential and non-residential properties in the Margarita Area benefitting from thes e improvements . Finally, the Goodwin report reanalyzed the fiscal impacts and potential economic activity tha t will be created by the buildout of the MASP area . As discussed later in this report the fina l conclusions determined there are short and long term economic benefits for getting the MAS P development started and then completed . As such, City assistance in moving Prado Roa d construction forward is an essential first step in MASP development . PH2-2 • • DISCUSSIO N Project History The Margarita Area Specific Plan (MASP) and associated Environmental Impact Report wer e approved and certified by the City Council in October 2004 with the primary goals of facilitatin g the production of housing and a mix of business park and neighborhood commercial uses . The MASP incorporates a comprehensive Public Facilities Financing Plan (Chapter 9) that wa s created in alignment with the City's 2003-05 Financial Plan policies . Up to 868 housing units are accommodated in the plan which anticipated build-out within approximately 15 years (2019).A portion of the area annexed and subdivided in 2003 with the remainder of the specific plan are a incorporated into the City in 2008 . The Council has approved vesting tentative maps for the three "Western Enclave" properties i n the Margarita Area following the adoption of the MASP . Reseal is the developer that acquire d the entitlements of two subdivisions in the Margarita Area (Tract 2342 and Tract 2353 — formerly known as Cowan and DeBlauw). The City has been actively working with th e developers to finalize the Vesting Tentative Tract Map and comply with all conditions . The primary condition which presents a considerable challenge and is the subject of the propose d •Agreement is the construction of the westerly portion of Prado Road and related frontag e improvements . A summary of the two approved vesting tentative tract maps currently owned by Rescal, Inc . ar e summarized as follows : Property Owner Map No . Date Approved B P KSF 1 MF Housing Units SF Housin g Units Rescal Reseal 234 2 2253 3-7-06 3-7-06 20 .1 1 18 .29 23 5 6 12 1 Total *38 .40 23 177 *Excludes 23 affordable units to be developed by the Housing Authority as pan of Tr 235 3 In addition to residential units, these properties also include mixed uses . Based on typical lot an d floor area assumptions for commercial uses, it is estimated that approximately 38,409 ft' of business park/mixed use development will eventually be constructed within the two projects . It i s likely that Reseal will sell off these business park components of the subdivision at a future tim e rather than develop them. KSF=Thousand Square Feet PH2-3 Prado Road Extension Costs and Phasing. The MASP acknowledged that establishing the east-west connection of Prado Road betwee n Broad Street and Higuera Street at the earliest possible stage of development is a goal of th e Specific Plan and City development process . The MASP recognized that due to multipl e property ownership issues as well as development phasing of individual properties, plans fo r phased implementation of Prado Road would be necessary . As contained in the public financing program of the MASP the total estimated costs for Prad o Road Extension (PRE) are $21 .48 million, summarized as follows by phase : Estimated Prado Road Extension Cost s Phase 1 : 4 Lane to M Stree t Phase 2 :Partial improvements : M to Broad (2 lanes ) Phase3 :Remaining improvements :M to Broad(4Lanes) Total 5,881,02 8 11,185,00 0 4,415,00 0 $21,481,02 8 These phases were developed in cooperation with the three subdivision owners in the wester n area of the MASP known as the "Western Enclave". They reflected perceived phases that wer e achievable based upon the housing market at the time and the ability to privately finance a larg e portion of infrastructure at early stages of development . Approved vesting tentative maps for the WE properties established the following phasing of th e Prado Road extension (PRE) based on total WE housing units, subject to availability of right o f way : Unit Occupancy PRE Improvements Phasin g 1 . Occupancy of 50 units 2 . Occupancy of 100 units 3 . Occupancy of 200 units 4 . Occupancy of 300 units Complete full PRE improvements to "M Street" (PRE-WE ) Complete construction plans & specs for full PRE improvement s to Broad Street (PRE-MB ) Start construction of 2 lanes to Broad Street (PRE-MB ) Complete construction of 2 lanes to Broad Street (PRE-MB) Significant changes in economic conditions since the establishment of the MASP and condition s of approval for the WE properties now make it infeasible to keep these phases and milestones fo r initial delivery of the PRE . Tract 2342, the smallest residential unit subdivision in the WE, is ready to move forward . It is , however, unable to fully fund the previously established segments of Prado Road and carry a reimbursement of over $4 .9 million dollars of costs in excess of their fair share obligations .A separate item on tonight's agenda will ask Council to modify those conditions of approval an d establish Prado Road improvement requirements for Tract 2342 that are commensurate with th e size of their development. The significant changes proposed will be the further phasing of th e first segments of Prado Road improvements with relaxing of the milestone units required to • • PH2-4 • • complete the PRE to "M Street". In essence, the developer has requested, and staff concurs, with breaking this portion of PRE into seven rather than three segments based upon current economi c and market conditions . The previously identified first phase of Prado Road (PRE-WE) is now being developed in seve n sub-segments as outlined in the revised delivery plan submitted by Rescal . The new "first" segment being completed by Tract 2342 is called Segment A and will complete substantia l improvements of Prado Road along the projects frontage that are more commensurate with tha t developments true fair share of construction . This Segment is currently estimated to cos t $2,120,250 . As stated previously, Rescal is only moving forward at this time with the single family phases o f the projects that they own. This further complicates the ability of those projects to advanc e substantial funding for needed improvements such as the significant capital outlay for the PRE . The reimbursement agreement discussed in this report addresses the immediate reimbursemen t and crediting needs for the first tract of single family homes (Tract 2342). Additiona l reimbursement and crediting will be necessary when Tract 2353 moves forward wit h development . Why is a Reimbursement and Crediting Agreement needed ? Even with the reduction in initial costs for the first segment of PRE and the relaxed milestone s for delivery, the residential component of Tract 2342 is being required to fund a substantia l amount of improvements beyond (approximately $1,687,800) their fair share of the roadwa y improvements . The vesting tentative maps for all WE projects call for reimbursement agreements to provide fo r credits (i .e . MASP Transportation Fees) and reimbursement (i .e . other impact fees) as necessar y for the substantial difference in the amount of Prado Road construction costs and the amount o f MASP transportation fees due under the adopted fee program 2 . The MASP 3 identified the use o f fee credits and other impact fees to advance reimbursement for projects that build publi c improvements for construction costs that exceed the estimated amount of "fair share" impac t fees . 2 As a part of the submittal of the plan for improvements to Prado Road, the subdivider shall submit a reimbursement proposal and schedule fo r the costs associated with the environmental, engineering and construction of Prado Road in its entirety, as established by the MASP . Subject t o final approval of the City, the proposal may include fee credits and/or other appropriate mechanisms that may be applied against non-TIT city - wide and MASP impact fees as development occurs, to facilitate completion of the Prado Road extension . 3 9.5 .3 Developer Financing : In many cases, developers fund facilities or dedicate land as a means of mitigating the impact of thei r 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 a s estimated in the capital improvement plan, can be issued to the developer. The developer can then apply them to offset fees imposed on hi s development or enter into a reimbursement agreement for any constructed facility that is oversized . PH2-5 Section 16 .20 .110 of the City's Municipal Code defines the process and purpose o f reimbursement agreements . This section provides that reimbursement agreements are eligibl e for projects that are in accordance with the following conditions : 1.Eligibility For improvements that that do not benefit a subdivision or site area ; 2.Entered into a form approved by the City Attorney ; 3.Accompanied by evidence so that reimbursement is limited to actual costs based on receipte d bills, canceled checks, or contracts . Condition s 1.Improvements are installed by the developer of an adjoining or nearby property ; 2.The improvements directly benefit the property currently being developed ; 3.An agreement for reimbursement has been entered into by the city and developer wh o installed these improvements ; 4.Not more than fifteen years have elapsed since the execution of the reimbursemen t agreement (Le . if reimbursement is not made within 15 years, no reimbursement will b e made ) Under Section 16 .20 .110, funds are collected or credits and reimbursements are made in accordance with the agreements. In no case does the City credit or reimburse more money tha n it actually collects or for verifiable eligible costs than are expended to construct publi c improvements . Any amounts not immediately reimbursed through credits or earl y reimbursement loans are made with future funds collected from developers . The Reimbursement Agreemen t Attachment 1 is the proposed reimbursement agreement for Tract 2342 and Segment A construction of the Prado Road Extension . The agreement covers costs incurred for permitting , project design, construction and other issues associated with completing this segment of the road . It is based upon the following basic principles : 1.Rescal is responsible for making and funding all Segment A improvements, includin g related costs for design, permitting and construction of the roadway . These costs are estimated to be $2,120,250 . 2.Tract 2342 is responsible for its "fair share" of these costs : $731,643 ; of which, th e residential component's share is : $432,452 . 3.There is a substantial difference in these amounts (particularly for the residentia l component of Tract 2342) that requires the development to "carry" these up-front cost s and await reimbursements from others for the improvements . 4.Total MASP Transportation Add on Fees (includes other projects besides Prado Roa d extension) for the residential component of Tract 2342 are projected to be $534,556 . • • PH2-6 5.However, since Tract 2342 is responsible for advancing all costs crediting an d reimbursements should be given to reflect fair share participation by the City and other s to ameliorate the substantial fronting of these costs by the development . 6.Reimbursement and crediting will come solely from subsequent MASP sub-area fe e collections from the MASP Transportation and MASP Park fees . In essence the City will "loan" potential fees from the MASP Park fees for the project rather than collecting and holding them for future use in the MASP area . 7.The City receives "first" repayment of credited MASP Park fees used to assist Tract 234 2 in offsetting their up-front costs for Prado Road improvements from all development i n the MASP except for Tract 2353 which will be used to first reimburse the Developer . As drafted, the Agreement specifies that funds will be credited and/or reimbursed to th e developer for actual costs from developer paid MASP Park Fees, and MASP Transportatio n Fees . The Agreement satisfies both the eligibility and conditional requirements found in Sectio n 16 .20 .110 et seq . of the City's Municipal Ordinance . While the improvements offer a benefit t o • the subdivision or site area, connecting Prado Road from Higuera to Broad Street provide s enhancements to the overall circulation system . The Agreement has been reviewed and approve d by the City Attorney and specifies that reimbursements will only be for actual costs based upo n the review of evidence by the City Engineer . The proposed Agreement has been prepared i n accordance with the tentative map approvals for these two properties and the Section 16 .20 .11 0 et seq . of the City's Municipal Code . Estimated Impact Fee s A study prepared by Goodwin Consulting Group, Inc . (January 4, 2013), concluded tha t construction and related costs to design Prado Road as required by the conditions of approva l would be approximately $2,241,007 .The project was recently competitively bid by the develope r and actual costs for Segment A will now be approximately $2,120,250 . Tract 2342 MAS P Transportation fee contribution for its residential component towards these improvements i s $534,856 . This amount is based on the MASP fees that took effect on July 1, 2012 and leaves a n estimated reimbursement amount of $1,585,394 . The proposed interfund loan proposes to advance $$454,128 from the MASP Park Improvemen t account to the MASP Transportation account to help reduce this out of pocket cost . This will b e done via credits given to Tract 2342 . This approach would result in an immediate credit o f $988,984 and remaining reimbursement due of $1,131,265 . It is anticipated that this amount wil l continue to be credited or reimbursed after additional Prado Road expenses are incurred for Trac t 2353 and responsible construction of Segments D and E of the PRE . MASP Transportation and Park Fees will be first credited and then used to reimburse Tract 2342 for outstanding balance o f • Segment A costs . If Rescal sells off the business park components of their project, or if othe r PH2-7 development occurs in the MASP, the reimbursement to the City for our interfund loan and t o Rescal will occur when that development happens . The following table itemizes Prado Road costs and fees that would be available for credit an d reimbursement and the outstanding reimbursement after all eligible fees have been applied . Single Family Units Constructed by Resmark for Tracts 2342 &235 3 Tract 2342 Tract 2353 Total Estimated Costs Triggered - Prado Roa d Segment A Triggered by Tract 2342 $(2,120,249 )$(2,120,249 ) Segment D&E/Resmark - Tract 2353 (Ph III, IV)$(1,031,200)$(1,031 .200 ) Total Costs Triggered by 177 Single Family Units $(2,120,249)$(1,031,200)$(3,151,449 ) Eligible Fees : Fee Obligation (Prior to Credits or Reimbursements ) MASP Transportation Add On Fe e $9,551 $1,690,52 7$534,856 $1,155,671 MASP Park Add on Fee $8,109 $454,128 $981,241 $1,435,36 9 Subtotal $988,984 $2,136,912 $3,125,89 6 Fees Applied Against Prado Road Extension Cost s MASP Transportation Add On $534,856 $1,155,671 .$1,690,52 7 MASP Park Add on Fee $454,128 $981,241 $1,435,36 9 Subtotal $988,984 $2,136,912 $3,125,89 6 Remaining Fee Obligations $$-$• MASP Transportation Add On $-$-$ MASP Park Add on Fee $-$-$ Subtotal $-$-$ Costs not covered by fee offset (Remaining Credit/Reimbursement)$1,131,265 $25,553 $25,553 Other Eligible Fees: (To be Credited/Used if BP Uses occur prior to completion o f Residential components of Tr 2342 & 2353 ) Business Park Component (Transportation Add on Fee Only)$(363,550) $(330 .500)$(694,050) As shown in the table, even with crediting of the MASP Park fees, the residential component o f Tract 2342 has a substantial cost beyond their fair share of costs for Segment A of the Prad o Road extension . If the business park component of that tract were to come forward sooner tha n expected this would help the situation but would not fully cover the remaining expense advance d by Rescal . Information for Tract 2353 has been shown in the above table to illustrate how the crediting will come close to balancing costs and fees when all residential units in the two tracts (owned b y Rescal) are completed . PH2-8 • As Tract 2353 moves forward and receives its own conditions modifications and crediting arrangement , reimbursement to Tract 2342 will be able to occur even after credit has been give n for Segment D & E construction cost . The final outcome that there will be close to a balancin g between fees credits and actual road construction costs incurred (a slight difference of $25,553). The outstanding reimbursement would be repaid : 1.When Rescal builds out the entire project (i .e ., the first phase of construction include s 177 single-family homes, future phases allow for the development of 23 multifamil y homes and 38,000 ft2 of business park development), and 2.By future development after all interfund loans have been repaid with interest, and/o r 3.A combination of 1 . and 2 . The City's Municipal Code provides that at the end of 15 years, if funds are not available t o reimburse Rescal for their unreimbursed costs that no additional reimbursement will occur . Thi s condition is consistent with section 16 .20 .110 (B) (4)4 of the City's Municipal Code . Rationale for Use of MASP Park and City-Wide Transportation Fee s AB 1600 allows interfund loans of one type of impact fee to fund unrelated improvements if th e • loan is accompanied by a term and an interest rate . Interfund loans provide the ability to fun d improvements earlier than if the City had to wait to completely collect each specific typ e development impact fee . Providing an interfund loan to advance the early repayment o f transportation costs from other impact fee funds has not been a common practice of the Cit y historically. This approach is commonly applied in California to fund public improvements as the need fo r one type of improvement does not always coincide with the timing of payment of impact fee s necessary to construct the improvement . The MASP identified this form of financing to construc t 'Conditions of Reimbursement Payments. Whenever property develops where : I . Improvements have been installed by the developer of an adjoining or nearby property ; 2.The improvements directly benefit the property currently being developed ; 3.An agreement for reimbursement has been entered into by the city and developer who installed these improvements ; 4.Not more than fifteen years have elapsed since the execution of the reimbursement agreement ; and 5.The original developer has submitted satisfactory documentation . The city wilt attempt to collect from the benefiting party, prior to the issuance of the development permits, a prorated share of the documented cost of improvements described in the reimbursemen t agreement . Reimbursement will be in accordance with Section 66485 et seq . of the Subdivision Map Act as amended from time to time . • PH2-9 S public infrastructure under the Other Financing Options 'section . The MASP identified th e need to advance partial or full reimbursement of funds where a developer's costs far exceed th e fair share . Providing an interfund loan will not disrupt the timing of viability of the neighborhood park o r the delivery of planned citywide transportation improvements . If the interfund loan i s authorized, future MASP Transportation Fees from other development would 1) repay the MAS P Park Add-On Fee Fund and 2) then Reseal . Interfund Loan Resolutio n Concurrent with the Agreement, staff is recommending that the Finance and Informatio n Technology Director be authorized to cause the interfund loan to advance early reimbursemen t of Prado Road costs from the MASP Park Fee account . This interfund loan poses no risk to th e General Fund . If repayment has not occurred at the conclusion of the loan, then the tenns can b e extended by City Council . However, it is expected that the recovery of the housing market an d resurgence of the economy over the next decade will generate fees to repay this loans . The term of the interfund loans are 15 years with an interest rate set at the average rate of retur n for City investments as determined by the Finance and Information Technology Director . Prepayment of the interfund loan can be made without any penalty . Interest costs will be offse t by future CPI adjustments to MASP development impact fees . FISCAL IMPAC T No impact to the General Fund will occur as part of Agreement . The use of the interfund loa n will delay some revenue to the City for use in constructing park facilities in the MASP are a however, all park facilities are located on the Damon Garcia property and it is year away fro m development . As such, delay of collection of these fees is not anticipate to cause and impact t o the impact fee funds since the use of these Park fees would occur many years from now . Fiscal Impact Analysi s Goodwin completed a fiscal analysis to evaluate the recurring fiscal impacts of the entire MAS P building out . The conclusions of this analysis are that the additional development in the MAS P is expected to generate a slight annual surplus of approximately $125,000 to the City at ful l buildout . The fiscal impacts of the MASP are estimated over a 15-year development period an d may vary depending on the types of development completed and the types of services required a t any given point in time . 5 Page74 : The City could also provide the necessary funding and then be reimbursed as impact fee revenue is collected. This could be accomplished by borrowing from other City capital improvement funds and then repaying, with interest, the fund when impact fe e revenues are collected from the Airport and Margarita areas . PH2-10 • • The estimated annual surplus at MASP buildout uses current (fiscal year 2011-12) revenue an d expense multipliers . If City expenses increase at a rate that exceeds the proportional rate o f revenue growth, the projected surplus will only materialize with reductions to service costs or a n actual reduction in services . Economic Impact Analysi s Goodwin also summarizes the economic impacts of the buildout of the MASP area on the City's private sector economy . During construction, anticipated to transpire over a 15-year period, a n average of 472 new jobs per year will be needed and $726 million in direct impacts on industr y output in the City . Over a period of approximately 15 years to complete, construction-relate d impacts will amount to 1% of the City economy on an annual basis . After construction, all of the businesses operating in the City, including new businesses in th e MASP, will generate 4,530 jobs and will produce $537 million in economic activity, which i s approximately 8% of the current level of economic activity in the City . Feasibility Analysi s Goodwin also produced a feasibility analysis of Tract 2342 based on the applicant's pro forma . Since this analysis contains confidential information it is not part of the agenda package . The • report conducts two tests of feasibility (burden-to-value and residual land value) to ascertain i f total infrastructure costs of Prado Road will place too heavy a burden on Resmark for the project to be successful . The analysis concludes that the project is still feasible without the interfund loan . Nonetheless, staff recommends the interfund loan as a tool to "kick-start" the construction o f Prado Road to advance the development objectives of the MASP . The MASP is a Residentia l Expansion Area designated to meet a major piece of the City's future housing needs (868 unit s total) and the Business Park component of the MASP is highlighted in the Economi c Development Specific Plan as a prime location for head-of-household jobs . Neither of these Cit y objectives can be realized without construction of Prado Road . The MASP specifically envisions the need for reimbursement agreements and interfund loan . The Goodwin reimbursement analysis assumes the interfund loan in the financing of Prado Roa d construction . Tract 2342 as the first phase of the project is the critical link and "pioneer" fo r development of the entire Margarita Area . This reimbursement agreement and interfund loan s are an incentive for Resmark to move forward into Tract 2353 as soon as possible . The quickest way for Resmark to get reimbursed is start construction on the Tract 2353 project . CONCURRENCE S The Public Works, Finance and Information Technology, and City Attorney concur with th e recommendations contained in this report . • PH2-11 S ALTERNATIVE S 1 Do not enter into the Agreement .Given the provisions of the tentative map approvals an d policies in the MASP, staff does not recommend this option . 2 .Approve Agreement with Different Terms .Based on in-depth discussions with th e property owners, staff recommends that the proposed agreement as it best implements th e vesting tentative map approvals and intentions of the MASP . ATTACHMENTS 1.Reimbursement Agreement 2.Interfund Loan Resolutio n 3.MASP Map AVAILABLE FOR REVIEW IN THE COUNCIL OFFIC E Goodwin Group :January 4, 2013 Reimbursement, Fiscal, and Economic Analyse s ACOUncil agenda repor5\ 2013r201302-1 91re inidd ag ement inteiund loa agree ment dohncon-bochum),era tact2302 reimbursement agreementdoc • • PH2-12 REIMBURSEMENT AND IMPACT FEE CREDIT AGREEMEN T FOR PRADO ROAD EXTENSION COST S This Agreement is made on , 2013, by and between the City of San Lui s Obispo and ResCal SLO 193, LLC ("Developer'-"'). Recitals A.WHEREAS, on October 12, 2004, the San Luis Obispo City Council adopted th e Margarita Area Specific Plan by City Council Resolution Number 9615 ; an d B.WHEREAS, on March 7, 2006, the City Council adopted Resolution No . 9776 (200 6 Series) approving Vesting Tentative Tract Map No . 2342 ; and , C.WHEREAS, Chapter 2 .3 of the City's General Plan Land Use Element identifies th e Margarita Area as a Residential Expansion Area intended to accommodate San Lui s Obispo's planned residential growth for the near future ; and, D.WHEREAS, Section 5 .7 .2 of the Margarita Area Specific Plan states tha t establishing the east-west connection of Prado Road between Broad Street an d Higuera Street at the earliest possible stage is a goal of the Specific Plan sinc e construction of Prado Road will facilitate housing development in the Margarit a Area ; and , • E . WHEREAS, Section 5 .7 .2 of the Margarita Area Specific Plan and the Vestin g Tentative Tract Map No . 2342 Condition of Approval 1 .g. provide that the City wil l consider a reimbursement agreement to help distribute and pay the costs o f designing, permitting and constructing portions of Prado Road ; and , F.WHEREAS, the Developer is responsible for completing design, permitting an d construction of portions of Prado Road that are beyond its fair share, are necessar y for orderly development of the Margarita Area and are contained in the MASP publi c financing program; and , G.WHEREAS, Pursuant to condition le of Resolution No . 9776, the City reserves the right and the Property Owner, either current or future, shall not oppose the formation of a community facilities district or other such financing mechanism that would fun d any final project costs for the construction of Prado Road Extension that are no t contained in the Margarita Area Specific Plan Impact Fee estimates .; and , H.WHEREAS, the City has determined that the most efficient, expedient, and effectiv e approach to coordinate the construction of Prado Road concurrent with the housin g development Tract 2342 is for the Developer to construct Prado Road i n conformance with the City approved Delivery Plan of Prado Road ; and , I.WHEREAS, Section 66485 et seq . of the Subdivision Map Act authorizes a loca l ordinance requirement that improvements installed by the subdivider for the benefi t of the subdivision shall contain supplemental size, capacity, number, or length fo r PH2-13 the benefit of property not within the subdivision, and that those improvements b e dedicated to the public ; an d J.WHEREAS, the City adopted Chapter 16 .20 . of San Luis Municipal Code in 200 6 to require physical improvements including supplemental capacity for subdivision s consistent with Section 66485 et seq . of the Subdivision Map Act ; and , K.WHEREAS, Chapter 16 .20 of the San Luis Municipal Code was adopted to specif y the conditions and eligibility for reimbursement and this agreement meets thes e requirements, provided that, if this Agreement is determined to be in conflict wit h Chapter 16 .20 of the San Luis Municipal Code, then San Luis Municipal Code shal l prevail ; and, L.WHEREAS, the City of San Luis Obispo has adopted Chapter 16 .20 of the San Lui s Obispo Municipal Code to set forth the procedure and conditions for physica l improvement standards and procedures, including the reimbursement of cost s whenever improvements are required to be installed adjacent to property other tha n that being developed or in greater size or capacity than required for the developmen t of the property under consideration ; and , M.WHEREAS, Section 9 .6 .1 and 9 .7 .2 of the Margarita Area Specific Plan and th e Conditions of Approval for Tract 2342 identified a reimbursement agreement as on e instrument to reimburse developers for costs to construct public facilities in excess o f those necessary to accommodate project requirements and , N.WHEREAS, Section 9 .6 .1 of the Margarita Area Specific Plan identifie d development impact fee credits and other impact fees (interfund loans) as potential mechanisms to fund such public infrastructure improvements and thei r reimbursements ; and , O.WHEREAS, the City's Economic Development Strategic Plan's (adopted Octobe r 16, 2012) primary goal is creation of head-of-household jobs through developin g strategies for infrastructure, focusing on promising growth sectors, and expeditin g desired economic activity; and , P.WHEREAS, Section 3 .1 of the Economic Development Strategic Plan designates th e Business Park zone of the Margarita Area as accommodating professional-service , research, and light manufacturing jobs that can support local households ; and, Q.WHEREAS, Sections 1 .4 and 1 .5 of the Economic Development Strategic Plan cal l for exploring financing strategies for infrastructure that address timing/costs an d ensure that that new development is responsible for infrastructure costs only to th e extent there is a nexus between infrastructure requirements and project impacts ; and, R.WHEREAS, Section 1 .9 of the Economic Development Strategic Plan contains a strategy to work with developers that are willing to install infrastructure beyond the new development's "fair share' requirement as an expedient way to provide new infrastructure in the City's Expansion Areas ; and, PH2-14 • • • • S.WHEREAS, the Economic Development Strategic Plan made findings that, in th e City's expansion areas, there are limited "shovel ready" sites for new constructio n due to the scale and cost of required public infrastructure and that key opportunit y sites need to be subdivided and/or lack infrastructure . These constraints add to th e time and complexity to bring projects online and have resulted in limited built offic e and business park space large enough to accommodate the expansion of som e companies currently in the City and companies looking to relocate to the area . T.WHEREAS, a report prepared by the Goodwin Consulting Group estimated that th e total jobs created by the buildout of the MASP to be approximately 7,081 .5 and 472 .1 new ongoing jobs at buildout ; and U.WHEREAS, Developer has constructed a drainage detention basin as required by th e VTTM Conditions of Approval and the Margarita Area Specific Plan at its sol e expense . The basin has been designed specifically to include surplus capacit y available for other parcels located in the Margarita Area Specific Plan as well a s drainage from the Prado Road improvements with the intent that said parcels an d roadway will be allowed to use such basin and, that Developer shall be reimburse d with fair share contributions when other benefitting parcels develop, including th e Prado Road improvements as defined in this agreement ; and , V.WHEREAS, it is in the interest of orderly development that parcels in the Margarit a Area Specific Plan be able to connect to this drainage detention facility and that th e Developer recover a proportion of actual costs from other owners in the Margarit a Area Specific Plan for constructing the detention basin and related facilities, i n excess of its project needs ; and , W.WHEREAS, the construction of Prado Road and the internal roadway network fo r Vesting Tentative Tract Map No . 2342 will provide access to adjacent parcels and i t is in the interest of public health and safety and orderly development to provide reasonable access to these parcels prior to the City accepting Prado Roa d improvements into the maintained City system ; and, X.WHEREAS, the Goodwin Report, dated January 4, 2013, has determined that th e allocated Fair Share of Prado Improvements for VTTM 2342 is $731,643 an d specifically $534,856 for the residential component of Tr 2342 . The Report also identified the cost of the initial phase(s) of Prado to be constructed by Developer ar e significantly in excess of that Fair Share . As an inducement for Developer t o construct desired improvements in excess of its fair share, City concludes it i s appropriate to accelerate repayment to Developer through the allocation of impac t fee credits from VTTM Nos . 2342, and from other residential and non-residentia l properties in the Margarita Area benefitting from the improvements . Y.WHEREAS, the Prado Road Extension is to be designed and constructed in phase s as defined in this Agreement, the Delivery Plan, and Conditions of Approval l .a-f. PPrado Road adjacent to Tract 2342 has been designed at Developer's expense, an d plan checked and approved by the City . It is the intent of this Agreement to credit o r PH2-15 Sreimburse developer for all of the related design expenses . Final design of portion s of Prado Road at the easternmost edge of the Western Enclave will require additional coordination with adjacent property owners as part of development of Tract 2353 ; and , Z . WHEREAS, if this Agreement is determined to be inconsistent with the Condition s of Approval, the Conditions of Approval shall prevail ; an d AA . WHEREAS, the City of San Luis Obispo has detennined that the Prado Road Improvements must be undertaken by Developer in Phases as defined in thi s Agreement and according to the Delivery Plan . BB . WHEREAS, Exhibit "A" to the Agreement and attached hereto provides the pla n schematic for the initial phase of construction (Segment A) as defined in thi s Agreement and approved and permitted by the City, which are incorporated herei n by reference ; an d CC . WHEREAS, Exhibit "A" to the Agreement and attached hereto provides conceptua l plans for subsequent phases of Prado Road Improvements as defined in th e Agreement and to be constructed by Developer or others ; and , DD . WHEREAS, in connection with obtaining a building permit for each business park , office, single-family, multi-family unit, or other allowed land use within th e Margarita Area Specific Plan, Margarita Area Specific Plan owners and/o r developers are required to pay certain City-wide Transportation Impact Fees an d Margarita Specific Plan Area Add-On Traffic Fees and Park In-Lieu (?) Fees to th e City of San Luis Obispo ; and EE . WHEREAS, in order to induce the Developer to incur the Developer Costs (a schedule of which, is attached hereto and incorporated herein by reference as Exhibit "B") the City of San Luis Obispo agrees to issue to the Developer Eligible Fe e credits or, as needed, reimbursement as established in this Agreement and authorize d under Section 16 .20 .110 of the City of San Luis Obispo Municipal Code with a n intent to compensate Developer for actual Developer Costs of Prado Road in exces s of its fair share . A schedule specifying the Eligible Fees for the construction o f single family units is attached as Exhibit "C". FF . WHEREAS, Developer has or will post a payment and performance bond, or othe r security, as may be reasonably approved by the Public Works Director and Financ e D irector ("Segment A Security Bond"), in the amount sufficient to secur e Developer's obligation to design and construct Segment A of the Prado Roa d Improvements for VTTM 2342 . After completion of Segment A improvements, Cit y agrees to release the Segment A Bonds in accordance with the City Municipal Code ; and , GG . WHEREAS, The City has found in connection with its review and consideration o f this Agreement that no subsequent or supplemental Environmental Impact Report i s PH2-16 • • necessary or required under CEQA because the terms and conditions of thi s Agreement are consistent with and within the scope of and contemplated by th e FEIR adopted for the MASP and VTTM's as required for implementation of the mitigation measures thereunder ; and HH . WHEREAS, an east-west connection between South Higuera and Highway 227 ha s been formal City policy since the early 1960's when it was included in the City's first General Plan ; and II . WHEREAS, several Environmental Impact Reports have been certified that include d Prado Road extension, including the 1994 Land Use and Circulation Elements, th e 2000 Amendment to the Circulation Element, and the Airport and Margarita Specifi c Plans. These EIR's have analyzed the impacts associated with adding the road to th e circulation system and Circulation Element and its current alignment . Projec t specific impacts were addressed in each environmental documents prepared fo r Vesting Tract Maps . The impending EIR for the Land Use and Circulation Element s will look at the entire circulation network and consider the current alignment and inclusion of Prado Road . Based on the foregoing, the parties agree as follows : AGREEMEN T • 1 . Terms . The foregoing recitals are deemed by both parties to be a material part of this Agreement and are incorporated herein and binding on the parties by this reference . 2 . Capitalized terms used in this Agreement will have the following meanings : (a)"Agreement" means this agreement as executed by the Developer and th e City of San Luis Obispo . (b)"Bonds" means a guaranty by a surety company acceptable to the City , securing that if a contractor fails to perform the work required to comply with the approved Prado Road Plans, the surety company will complete the work . (c) "City "means the City of San Luis Obispo, a municipal corporation . (d)"Conditions of Approval ("COA")" means the required Developer actions a s shown in Resolution 9776 as adopted by the City of San Luis Obispo on March 7, 2006 and a s modified on September 28, 2011 and revisions, if any, as adopted by Council on February 19 `h, 2013 . (e)"Developer" means ResCal SLO 193, LLC, a Delaware limited liabilit y company . (f)"Developer Costs" means those costs specified in Exhibit "B" related to the estimated cost of designing, permitting and constructing the Prado Road Improvements which shal l PH2-1 7 • include the costs of the Goodwin Consulting Group Margarita Area Specific Plan analysis, and al l right-of-way acquisitions secured by Developer, if any . These costs shall not exceed $2,120,25 0 unless they are decreased or increased, based upon the actual costs of construction after bidding o r for cost changes established in this Agreement with prior approval by the City Engineer, or a s authorized based upon Section 8 of this Agreement . (g)"Eligible Fees" means the estimated Impact Fees for Tract 2342 that are eligible for credit or to reimburse the Developer for the actual costs of constructing roa d infrastructure, which are in excess of the Project's fair share as specified herein . Eligible Fees ar e limited to Margarita Area Add On Transportation Impact Fees and Margarita Area Specific Pla n Add On Park Impact Fees as specified in Exhibit "C" for buildout of single family homes , multifamily homes and business park properties in VTM 2342 . No City Impact Fees or Connectio n Fees not specifically included herein as Eligible Fees, as described above, shall be available fo r credit or reimbursement . "Non Eligible Fees" All city impact fees or connection fees no t specifically included as Eligible Fees as describe above . Non Eligible fees include, but are no t limited to, Citywide Transportation Impact Fees for all other MASP projects .. (h)"Impact Fees" means fees as defined under Section 66000 (b) of the California Government Code that were adopted by the City of San Luis Obispo and which apply t o the proposed development in the Margarita Area Specific Plan . (i)"Plan Fees" means all Inspection and Processing Fees imposed by the City i n its review of the Prado Road Plans and Prado Road Improvements . (j)"VTTM" means "Vesting Tentative Tract Map". VTTM No . 2342 was approved by Resolutions 9776 on March 7, 2006 . (k)"Margarita Area Specific Plan ("MASP")" means the specific plan adopte d by the City of San Luis Obispo on October 12, 2004 by City Council Resolution Number 9615 . (1) "Segment A" is that portion of Prado Road designated as Segment A of th e Delivery Plan and shall consist of street frontage improvements including curb, gutter, sidewalk , parkway landscaping, two 12-foot travel lanes, and a 5-foot bike lane/shoulder on the north side o f Prado and a 5-foot bike lane/shoulder on the south side of Prado . Segment A shall also include al l storm drainage, water, sewer and dry utilities per plan along its frontage along with a stub o f necessary utilities to the south side of Prado Road . and the improvements will include a transitio n from the "Serra Meadows Road" entrance of Tr 2342 to the existing paved road section on the sout h side of Prado Road . (m) "Segment D" and "Segment E"consists of those portions of Prado Roa d designated as Segment D and Segment E, respectively, of the Delivery Plan, a component of th e Prado Road Improvements, which is the street widening to accommodate up to 2 lanes and variou s infrastructure, past the roundabout to east of the westerly most entry to VTTM 2353 . These segments of improvements will be constructed as part of development of Tract 2353 and may be subject to their own reimbursement agreement with the City . PH2-18 • • S • (n) "Prado Road Plans" means plans and commensurate physical improvement s approved by the City of San Luis Obispo to construct Segment A of Prado Road as required by thi s Agreement, the VTTMs for Tract 2342 as depicted in Exhibit "A". 3 . City Obligations .In consideration of Developer's agreement to design and construct the Prado Road improvements, the City agrees : (a)To cooperate and work with Developer to promptly secure all necessar y rights-of-way at Developer's cost . (b)Upon Developer's completion (both full and partial) of the Prado Roa d improvements as specified in the approved Prado Road Plans, and upon notification to the City, th e City shall inspect Prado Road improvements to determine compliance with approved Prado Roa d Plans, engineering standards, and COAs . The City's inspection shall determine if there has bee n substantial conformance with approved Prado Road Plans, engineering standards and the conditions of approval of VTTM 2342 . The City agrees that satisfactory completion of Segment A shal l constitute substantial conformance with COA l .a-h of VTTM 2342 . If the City determines that th e Prado Road Improvements do not meet the requirements of the approved Prado Road Plans , engineering standards, and/or Agreement, then the City will provide written notice to Developer an d Developer will have sixty (60) days to correct or make substantial progress on addressing identifie d deficiencies . If, after sixty (60) days, the deficiencies are not addressed and the City, at its sol e discretion, has determined that no substantial progress has occurred to address identifie d deficiencies, the City can use the Bond to correct any deficiencies . If the City determines that th e Prado Road Improvements meet the requirements of the approved Prado Road Plans, engineerin g standards, and Agreement, then the City shall take action within forty-five (45) days to accept Prad o Road improvements into the City's maintained street system . (c)To promptly provide credit against Eligible Fees due from Developer fo r reimbursement to Developer for its Developer Costs pursuant to this Agreement, subject to th e terms and limitations set forth in this Agreement . (d)To pay itself with fees paid for Inspection and Processing Fees ("Plan Fees") for the costs of inspecting the construction of Prado Road Improvements and for costs to review an d approve Prado Road Plans and specifications for Segment A, with these Plan Fees capped a t ($148,350). as specified in Exhibit "B .". This amount reflects a credit for previous plan review fee s collected from the prior applicant for Tr 2342 that processed plans and specifications for a differen t Prado Road delivery project . (e)To promptly release the Segment A Bond when Segment A is completed , promptly release the Segment D Bond when Segment D is completed, and promptly release th e Segment E Bond when Segment E is completed . (f)To inspect Prado Road improvements, review Prado Road Plans and approv e said plans, provided they are in compliance with approved conditions and engineering standards . 4 . Developer Obligations .In consideration of City's entering into the Agreement , Developer agrees to : PH2-19 (a)To construct the Segment A Prado Road Improvements according to the approved plans or according to change orders approved pursuant to this agreement . (b)Acquire all necessary rights-of-way, as specified in condition COA lc, t o construct Segment A of the Prado Road Improvements consistent with the approved Prado Roa d Plans . If the Developer is unable to secure all necessary rights-of-way after demonstrating that th e Developer has reasonably exhausted negotiations, Developer shall pay the City's costs to acquire al l necessary rights-of-way and shall be reimbursed with credits against Eligible Fees . If the City i s unable to acquire said rights-of-way or if the City Council ultimately decides not to pursu e acquisition, the City will work with the developer to modify Prado Road plans accordingly . (c)Complete construction of Segment A, per approved plans, prior to occupanc y of the 31st unit within Tract 2342 or within twelve (12) months of issuance of the first buildin g permit (except for model homes), whichever occurs first, or within such longer period of time t o which both parties subsequently may agree in writing . (d)Allow adjacent property owners to connect to the sub-regional basin , provided that adjacent property owners pay Developer an amount not to exceed the actual rea l property and construction costs incurred by Developer for the construction, maintenance an d operation of the detention basin . The sub-regional ponding basin is essential to provide adequat e drainage in the Western Enclave and to support planned residential development . The City agree s prior to approving a project that has been designated to drain into said facility ; it will giv e Developer notice of said approval and any alternative drainage proposals in conflict with th e concept of the sub-regional basin . (e)Reasonably allow vehicles for the purposes of construction requiring acces s to APN's 053-022-016 (King), 053-441-001(Davis), 053-441-002(L . Martinelli), and 053-441-00 3 (A . Martinelli), to travel on Prado Road and internal roads constructed on VTTMs prior to th e City's acceptance of Prado Road and the internal roads at no cost until such time as Prado Road an d internal roads located on VTTM's are accepted into the City's maintained Road system, at whic h time they will be open to the public . Such access shall not interfere with Developer's constructio n of the Project and will be subject to reasonable requirements as agreed upon by the property owners . 5 .Terms of Construction .The parties agree that time is of the essence as to th e installation of the Prado Road Improvements . To that end, the following obligations and procedure s govern timing of the installation of the Prado Road Improvements : (a) The Segment A Prado Road Improvements shall be completed in a timel y manner established in Section 4(C) above, all in a good and workmanlike manner, in accordanc e with the Agreement and the approved Prado Road Plans, engineering standards, and COAs . The City shall reconcile the amount of Eligible Fee credits, compared to the Developer Costs actuall y incurred by Developer pursuant to this Section, within sixty (60) days after Segment A of the Prad o Road Improvements are complete and accepted by the City as specified in this Agreement, i n accordance with the Prado Road Plans, engineering standards, and this Agreement ; and PH2-20 • • • • (i)The City Engineer has verified the Developer Costs, based o n documentation of actual costs incurred to be provided to the City by Developer, and approved th e Prado Road Improvements, as provided in Section 4 of this Agreement . The City shall have sole determination to reasonably determine eligible costs for fee credit and reimbursement . (b) The Developer may request in writing that the City extend the milestones established in this Agreement ("Milestone Completion Event(s)") due to circumstances beyon d Developer =s control including : (i) City submission of a substantial change order for the Prado Roa d Improvements; or (ii)The City's or Developer's inability to obtain the necessary rights-of- way to construct the Prado Road Improvements ; o r (iii)The City's processing time to revise the approved Prado Road Plans , if the City chooses to revise the scope of the Prado Road Improvements ; o r (iv)Any City permitting delays, or if clearances or approvals are no t promptly issued by any federal, state, regional or local agency ; o r (v)If any Force Majeure event, as provided in Section 10 of thi s Agreement, occurs . (vi)If through no act or omission of the City, Developer does not compl y with the Milestone Completion Event(s), City shall notify Developer, in writing that Developer ha s not complied with the Milestone Completion Event(s). If Developer does not cure this failure t o satisfy the Milestone Completion Events within thirty (30) days, City shall withhold issuance o f certificates of occupancy and fee credits or reimbursement until Developer complies with th e Milestone Completion Events . 6 . Proof of Developer Costs ; Limits .Developer is entitled to fee credits an d reimbursements of documented Developer Costs for the Prado Road Improvements, as verified b y the City Engineer. It is intended that both City and Developer expenses shall be cost controlled an d limited in completing improvements to Prado Road . In no event shall the Developer Costs eligibl e for reimbursement for Segment A exceed $1,131,265 of the available Eligible Fees from VTT M 2342 . As shown in Exhibit C, the differential between the Developer Costs and Eligible Fees fo r the residential component of VTTM 2342 is $1,131,265 . If fmal Developer Costs should increas e or decrease pursuant to change orders or other cost modifications allowed in this Agreement, th e parties shall meet and confer to reach agreement on allocation of costs and may be modified i n accordance with paragraph 8 . (a) Within thirty (30) days after submittal of documentation by Developer, th e City Engineer shall verify the Developer Costs, or shall submit a request in writing to Developer fo r additional information deemed necessary by the City Engineer to verify Developer Costs . Such additional information shall be submitted by the Developer to the City Engineer within thirty (30 ) days from receipt of the written request by the City Engineer . PH2-21 (b)The City Engineer shall complete all verification and approvals of each of th e three Segments of the Prado Road Improvements within thirty (30) days after Developer ha s submitted any requested additional information to the City Engineer and the submittals are deeme d "Complete" by the City Engineer . The City Engineer shall determine "Final Developer Costs" an d shall reconcile the amount of Eligible Fee credits issued with the amount of Developer Cost s actually incurred for each Segment of the Prado Road Improvements upon verification o f completion of each Segment . (c)City shall issue further fee credits for reimbursement payments to Develope r if the City collects Eligible Fees from Developer for future multi-family or non-residential phases o f project as approved in Vesting Tentative Tract Map No . 2342 . In such a situation, Developer shal l not be obligated to pay the Eligible Fees upon issuance of building permits by the City . Currentl y the Developer owns adjacent Tract 2353 and it is intended that credits against Eligible Fees fro m that development will also be used to reimburse Developer for advance costs in constructin g Segment A Prado Road improvements . In such a situation, Developer shall not be obligated to pa y the Eligible Fees upon issuance of building permits by the City . If Developer sells or convey s these parcels to others, City shall collect the fees and pay to Developer quarterly such collectio n after provisions in Section (d) are satisfied . (d)City shall issue such reimbursements to Developer after it collects Eligible Fees from other Western Enclave developers and property owners after paying any City interfun d loan obligations related to this agreement, notwithstanding any provision of any law, San Lui s Obispo Municipal Code or this reimbursement agreement . The interest rate on the interfund loan shall be as close as administratively practical to the average rate of return for City investment s during the period of such interfund loan, as determined by the City Finance and Information Technology Director . After repayment of the interfund loans the City then shall insure tha t Developer shall be the first to receive such cash payments for reimbursement when Eligible Fee s are paid to the City by others up to the maximum reimbursement amount . (e)The parties acknowledge that, except for right of way to be acquired for the construction of the roundabout from the L Martinelli and Byron Davis properties, and the south sid e of Prado Road across the Davis parcel, no right of way acquisition is required for th e implementation of the Delivery Plan for Segment A . 7 .Fee Credits and Developer Costs .In connection with Developer's application fo r building permits to be issued in connection with development of VTTM 2342, City shall not impos e or collect Eligible Fee credits for documented costs of construction, based upon the Develope r Costs . Developer shall pay all other Impact Fees in full . In addition, the City acknowledges and agrees that issuance of some of the Eligible Fee credits ma y require the City to issue loans, credits or charges, internally, from one or more City accounts t o other City accounts . Such internal City reconciliation shall have no impact upon Developer's entitlement to receive Eligible Fee credit issuance for all of Developer's Cost as provided in Sectio n 6 of this Agreement . Upon completion of each Segment of the Prado Road Improvements, Cit y shall reconcile and issue fmal confirmation of the amount of previously-issued Eligible Fee credit s and Developer Costs . If at the completion of any phase of development, the combination o f Eligible Fees are less than or do not equal the accumulated Developer Costs for all Phases, th e PH2-22 • • • City's obligation to issue subsequent Eligible Fee Credits is specified in Section 6(c) of this Agreement. If at the completion of any phase of Development, the combination of Eligible Fees ar e more than or exceed the accumulated Developer Costs for Segment A, the City's obligation to issu e subsequent Eligible Fee Credits or reimbursement will be considered satisfied and this Agreement will be considered complete, except that the Developer shall then be required to pay to the City al l remaining Eligible Fees that are greater than the costs to construct improvements as specified in thi s agreement . All other Development Impact Fees shall be paid at time of the issuance of Buildin g Permits . 8 .Scope of Agreement .This Agreement shall not be construed to limit the right of th e City to enlarge, relocate, alter or extend the Prado Road Improvements . However, it is understoo d that any changes to the Prado Road Improvements may result in corresponding adjustments to th e Developer Costs and the amount of Eligible Fee credits as set forth in the Agreement . (a)There shall be no increase or decrease in cost from the Developer Cost unles s the increase is reflected in a change order submitted by Developer and approved by the City or vic e versa . The only change orders excepted from City approval are (a) those in which Developer shift s cost savings from one line item of a component of the Developer Costs to another line ite m (excluding use of project contingency), or (b) those for which Developer does not see k reimbursement from the City . Project line item transfers shall be reported to the City. (b)Furthennore, Developer and the City Engineer, together, may approve a change order if the total Developer Cost increase is Twenty-Five Thousand Dollars ($25,000) o r • less and the net total of the change orders theretofore approved does not exceed the contingenc y amount. Developer and the City Manager together may approve a change order if the cost increas e is One Hundred Thousand Dollars ($100,000) or less and the net total of the change order s theretofore approved does not exceed the contingency amount. Any change order in excess of $100,000 above the Development Costs, shall require City Council approval . (c)The City's approval shall not be unreasonably withheld, delayed or conditioned; provided it shall be reasonable for the City to deny any change order resulting from a cause other than unforeseen conditions or City-initiated changes . The City shall accompany an y rejection with a written statement of the basis therefor . To the extent the change order does no t require City approval, Developer may proceed with the work covered by the change order pendin g City approval of the change order, or even after City rejection of the change order, but Develope r shall do so at its own risk to the extent that the City raises valid objections to the change orde r proposal . Any change order that is submitted to the City for approval shall be deemed accepted i f not accepted or rejected by the City within ten (10) working days of such submittal . Any chang e order submitted that needs City Council approval shall be placed upon the first available Cit y Council agenda after the change order request has been deemed complete by the City Engineer . 9 .Release .The Developer hereby releases and agrees to indemnify and save the Cit y harmless from and against any and all injuries to and deaths of persons and damage to property, an d all claims, costs, damages, demands, liability and losses howsoever the same may be caused an d whenever the same may appear, resulting directly or indirectly from the performance o r nonperformance of any work to design, construct, and/or install the Prado Road Improvements, an d also from any and all injuries to and deaths of persons and injuries to property or other interests an d • PH2-23 Sall claims, costs damages, demands, liability and losses howsoever same may be caused an d whenever the same may appear, either directly or indirectly made or suffered by the Developer, th e Developer's agents, employees, and subcontractors, while engaged in the performance of th e construction and installation of said Prado Road Improvements . Such release and indemnificatio n by the Developer is in effect only for acts or omissions by Developer arising from or relating t o construction of the Prado Road Improvements up until the time the City accepts each segment of th e Prado Road Improvements, or until thirty (30) days from the time the City receives : 1)notice fro m the Developer that the Prado Road Improvements are complete and 2) they are accepted by the Cit y as set forth in Section 3 of this Agreement, whichever occurs first . 10.Indemnification .Developer shall indemnify and hold City, its officers, employee s and agents harmless from and against any and all liability, claims, suits, actions, damages, an d causes of action arising out of any personal injury, bodily injury, loss of life, or damage to property , or any violation of any federal, state or municipal law or ordinance, or other cause in connection with the acts or omissions of Developer, its employees, subcontractors, or agents, or on account o f the performance or character of construction and installation of the Prado Road Improvements . Such indemnification by Developer shall cease upon acceptance of the Prado Road Improvement s by the City . It is understood that the duty of Developer to indemnify and hold City harmles s includes the duty to defend City as set forth in section 2778 of the California Civil Code . Within fifteen (15) days of City's notice that it has been made a party to an action arising out o f Developer's acts or omissions under this Agreement, Developer shall provide a defense to the Cit y in that action . In the event Developer fails to provide such a defense to City, Developer shall b e liable to the City for its attorneys" fees and litigation costs incurred to defend itself beginning on th e sixteenth (16th) day from the date of the City's notice and request for a defense . Acceptance o f insurance certificates and endorsements required under this Agreement does not relieve Develope r from liability under this indemnification and hold harmless clause . This indemnification and hol d harmless clause shall apply whether or not such insurance policies shall have been determined to b e applicable to any of such damages or claims for damages . 11.Acceptance of the Prado Road Improvements .The Prado Road Improvements to b e constructed shall become the sole exclusive property of the City upon acceptance of said Prad o Road Improvements by the City. Developer shall notify City in writing when the Prado Roa d Improvements are complete . Such notice shall be submitted to the City by personal delivery an d shall be deemed received by the City on the date of delivery . Such written notification shall includ e a request that the City accept the Prado Road Improvements . The City shall accept the Prado Roa d Improvements if it is determined that it was constructed consistent with the approved Prado Roa d Plans, engineering standards, and Agreement within sixty (60) days from receipt of suc h notification by Developer. If the City determines that the Prado Road Improvements do not mee t the requirements of the approved Prado Road Plans, engineering standards, or Agreement, then th e City will provide written notice to Developer and Developer will have sixty (60) days to correct o r make substantial progress on addressing identified deficiencies . If after sixty (60) days, the deficiencies are not addressed and the City at its sole discretion has determined that no substantia l progress has occurred to address identified deficiencies, the City can use the performance an d payment bond to correct any deficiencies . Developer shall be responsible for securing a bond fo r 10% of the cost of said improvements to be held for one year, to ensure the work is adequatel y guaranteed . PH2-24 • • • 12 .Legal Challenges .Nothing herein shall be construed to require City to defend an y third party claims and suits challenging any action taken by the City with regard to any procedure o r substantive aspect of the City's approval of development of the Property, the environmenta l process, the proposed uses of the Property, or the approval of this Agreement . The Developer may , however, in its sole and absolute discretion appear as real party in interest in any such third part y action or proceeding . If such legal challenge is filed, City and Developer shall meet and confer t o mutually agree upon the appropriate actions to be undertaken by the parties . If the City defend s such action or proceeding, the Developer shall be responsible to reimburse the City for whateve r legal fees and costs, in their entirety, which may be incurred by the City in defense of such action o r proceeding. In the event the City, in its sole discretion, opts to defend any such action, the City , after consultation with Developer, shall retain such legal counsel as the City deems necessary an d appropriate. Applicant shall reimburse City in the event an award of court costs or attorney fees i s made against City in favor of any third party challenging any matter herein . 13 .Force Majeure .The Term of this Agreement and the time within which Develope r shall be required to perform any act under this Agreement shall be extended by a period of tim e equal to the number of days during which performance of such act is delayed unavoidably b y strikes, lock-outs, Acts of God, failure or inability to secure materials or labor by reason of priorit y or similar regulations or order of any governmental or regulatory body, initiative or referenda , moratoria, litigation filed attacking execution or performance of this Agreement, severe economi c downturn, enemy action, civil disturbances, fire, unavoidable casualties, or any other cause beyon d the reasonable control of Developer . • 14 . Successors and Assigns .Each and every provision of this Agreement shall b e binding and inure to the benefit of the successors in interest of the Parties hereto . 15.Term .This Agreement shall expire fifteen (15) years after the date of execution o r when Tract 2342 reimbursements and credits are complete as identified in Section 7, whicheve r occurs first .. 16.Integration .This is an integrated Agreement containing all of the consideration , understandings, promises and covenants exchanged between the parties, notwithstanding th e Developer's obligations as specified in the approved Conditions of Approvals as adopted i n Resolution Nos . 9776 and 9777, approving, respectively, Vesting Tentative Tract Map Nos . 2342 . 17.Construction and Interpretation .It is agreed and acknowledged by the parties tha t the provisions of this Agreement have been arrived at through negotiation, and that the parties hav e had a full and fair opportunity to revise the provisions of this Agreement and to have suc h provisions reviewed by legal counsel . Therefore, the normal rule of construction that an y ambiguities are to be resolved against the drafting party shall not apply in construing or interpretin g this Agreement . 18.Jurisdiction .Any action by any party to this Agreement, or any action concerning a security furnished pursuant thereto, shall be brought in the appropriate court of competen t jurisdiction within the County of San Luis Obispo, State of California, notwithstanding any othe r provision of law which may provide that such action may be brought in some other location . PH2-2 5 • 19. Choice of Law .This Agreement is made under and in all respects will b e interpreted, enforced and governed by the laws of the State of California . 20. Amendment .This Agreement cannot be altered, amended or modified in any wa y without the express written consent of each party hereto or their authorized successor-in-interest . 21.Third Party Beneficiaries .Property owners, their heirs, successors and assigns, o f those properties to be benefitted by the provisions of paragraphs 4(e) and 4(f) ("Third Part y Owners") of this Agreement are intended to be third party beneficiaries of this Agreement solely as to those two sections . As such, said Third Party Owners shall have the right, at their sole cost an d discretion, to bring an action to enforce those two sections only . Nothing in this Agreement is intended or shall be construed to require the City to bring any action to enforce said provisions o n behalf of any Third Party Owner and the City shall not be liable to any party, beneficiary or Thir d Party Owner for any costs, damages, liabilities, fees, or awards of any kind related to or arisin g from the failure of a party to this Agreement to abide by or enforce the terms of paragraphs 3(f) and/or 3(g). Except as specifically provided herein, this Agreement is made and entered into for th e sole protection and benefit of the parties and any successors or assign of the parties . No othe r person shall have any right of action based upon any provisions of this Agreement . 22. Time is of Essence .Time is of the essence for this Agreement . 23. Notice .Notices under this Agreement shall be deemed given when delivered b y First Class Mail, Postage Prepaid, as follows : City of San Luis Obisp o with a copy to : City Attorney 990 Palm Street San Luis Obispo, Ca 9340 1 Counterparts .This Agreement may be executed in one of mor e Developer : ResCal SLO 193, LL C Robert N . Goodman 10880 Wilshire Boulevard, Suite 142 0 Los Angeles, CA 9002 4 with a copy to : Allen Matkins Leek Gamble Mallory & Natsis LL P John Condas, Esq . PH2-26 City Clerk 990 Palm Street San Luis Obispo, CA 93401 • • 1900 Main Street, 5th Floo r Irvine, CA 9261 4 24. Counterparts .This Agreement may be executed in one of more counterparts, each o f which shall be deemed an original, but all of which together shall constitute a single agreement . 25.Severability.If any one or more of the provisions contained in this Agreement shal l be found to be invalid, illegal or unenforceable in any respect, the validity, legality an d enforceability of the remaining provisions shall not, in any way, be affected or impaired . 26. Authority .The parties hereby represent that the persons executing this Agreement are expressly authorized to do so for and on behalf of the parties . 27.Captions .The captions of the Sections of this Agreement are for convenience an d reference only, and are not intended and shall not be construed to define or limit the provision t o which they relate . 28. Recitals and Exhibits .The Recitals first set forth herein and all Exhibits attache d hereto are incorporated in this Agreement . • PH2-27 IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed th e day and year first above written . ATTEST : CITY OF SAN LUIS OBISP O By: City Clerk Mayor Jan Marx RESCAL SLO 193, LLC, a Delaware limited APPROVED AS TO FORM : liability compan y By : City Attorney Name : Title : • • PH2-28 EXHIBIT "A" DEPICTION AND SPECIFICATION OF PRADO ROAD IMPROVEMENT S ..a.e w.aMOadlF°:icil?uW NOISNBIX3 OVO1 OON2J d • • PH2-29 Exhibit B Prado Road Segment "A" Developer Costs 2342 Bid s Engineers Estimate 1/25/201 3UnitsQuantity Demolition and Earthwor k Sawcut LF 200 .00 Asphalt Grind/Stockpile SF 29,500 .00 Demo Storm Drain EA 1 .00 $27,125 .00 Demo Power Poles EA 5 .00 Dem SD Culvert EA 1 .00 Relocate Siren Pole(PGE & All)2 EA 1 .00 $50,497 .4 1 Demo Fence LF 1,560 .00 Misc Demolition LS 1 .00 Rough Cut/Fill CY 12,500 .00 $79,250 .00 Rough Cut/Fill for Extended Shoulder 'CY 1,100 .00 $5,225 .00 Subgrades SF 75,000 .00 Erosion Control Subtotal $162,097.4 1 Hydroseed AC 0 .50 $29,150 .0 0 Stabilized Construction Entrance EA 1 .00 Concrete Waste Area EA 1 .00 Soil Stabilization SF 50,000 .00 Storm Drain inlet Protection EA 3 .00 Gravel Bags EA 25 .00 Fiber Rolls LF 2,500 .00 Silt Fencing LF 1,350 .00 Erosion Control Repair (Allowance)LS 1 .00 $10,000 .0 0 Water Lines Subtotal $39,150.00 8" Water Lines LF 200 .00 $64,750 .0 0 8" Recycled Water Mains LF 150 .00 $29,450 .0 0 8" Valves EA 6 .00 20" Valve EA 1 .00 Recycled Water Service EA 1 .00 Fire Hydrants EA 2 .0 0 Sewer Lines Subtotal $94,200.0 0 8" Sewer Lines LF 1,100 .00 Sewer Manholes EA 7 .0 0 Sewer Tie In EA 1 .0 0 Storm Drains Subtotal $50,800.0 0 Curb Inlets EA 3 .00 PH2-30 • • Exhibit B Prado Road Segment "A" Developer Costs 2342 Bid s Engineers Estimate 1/25/201 3UnitsQuantity 54" HDPE SD LF 287 .00 48" HDPE SD LF 2,015 .00 48" RCP SD LF 95 .00 42" HDPE SD L F 36' HDPE SD L F 24" HDPE SD L F 18" SD LF 125 .00 Headwall LS Misc Connectors LS 1 .00 Storm Drain Manholes EA 3 .00 Storm Drain Junction Box (Large)EA 1 .00 Storm Drain Junction Box (Medium)EA Subtotal $319,265 .00 • • PH2-3 1 Exhibit B Prado Road Segment "A" Developer Costs 2342 Bid s Engineers Estimate 1/25/201 3UnitsQuantity Street Improvement s Curb and Gutter LF 1,025 .00 $139,933 .00 Cross Gutter L F Curbs LF 1,075 .0 0 ADA Access Ramps EA 4 .0 0 Street Lights EA 4 .0 0 Street Light Circuits EA 4 .0 0 Sidewalks SF 11,500 .0 0 Pavers SF 3,700 .00 $72,200 .00 Street Signs EA 21 .00 $9,925 .0 0 Barricade EA 1 .0 0 Street Striping LS 1 .00 $16,922.0 0 AC Dike LF 900.00 $444,300 .0 0 AC Paving 3 Tons 2,800 .0 0 Class II Base Tons 9,200 .00 Landscapinq 1 Subtotal $683,280 .00 Irrigation Sleeves $9,280.0 0 Irrigation Controller $5,000 .0 0 Water Meter $564 .00 Trees EA 20 .00 $6,500 .00 Landscaping/Irrigation SF 16,500 .00 $66,000 .00 Soft Costs Subtotal $87,344 .00 Hard Cost Subtotal $1,436,136.4 1 Contingency @ 5%$71,806 .82 Estimated Hard Cost $1,507,943.23 Mobilization 5 LS 1 .00 $5,000 .00 Civil Engineering (Full Design)LS 1 .00 $133,119 .0 0 Hydrology LS 1 .00 $4,000 .0 0 Landscape Architecture LS 1 .00 $7,912 .5 0 Survey LS 1 .00 $8,500 .0 0Water meter connection tee 1 .00 $18,260 .0 0 Soils Engineering/Material Testing LS 1 .00 $15,000 .0 0 SWPP Monitoring LS 1 .00 $7,500 .0 0 Traffic Control with K-Rail s LS 1 .00 $16,000 .0 0 Bonding Fees LS 1 .75%$26,389 .01 PH2-32 • • Exhibit B Prado Road Segment "A" Developer Costs 2342 Bid s Engineers Estimate 1/25/201 3UnitsQuantity LS 1 .75%$26,389 .0 1 LS 2 .25%$33,928 .7 2 LS 0 .50%$7,539 .7 2 LS 1 .00 $191,370 .0 0 LS 1 .00 $(43,020 .00 ) LS 1 .00 $60,000 .0 0 4 .30%$65,260 .1 1 Subtotal $583,148 .0 6 Contingency @ 5%$29,157 .40 Total Soft Costs $612,305 .4 6 Total Costs:$2,120,248 .69 Allocated Insuranc e Supervision/Construction Ovh d Blueprint s City Plan Check and Inspectio n Credit Plan Check Fees for Prior Wor k Goodwin Report 5 Allocated Pond Cost (see detail ) • PH2-3 3 EXHIBIT C Single Family Units Constructed by Resmark for Tracts 2342 &2353 Tract 2342 Tract 2353 Tota l Estimated Costs Triggered - Prado Roa d Segment A Triggered by Tract 2342 $(2,120,249)$ (2,120,249 ) Segment D&E/Resmark - Tract 2353 (Ph III, IV)$(1,031,200)$(1,031,200 ) Total Costs Triggered by 177 Single Family Units $(2,120,249)$(1,031,200)$-$ (3,151,449 ) Eligible Fees : Fee Obligation (Prior to Credits or Reimbursements ) MASP Transportation Add On $534,856 $1,155,671 $ 1,690,52 7 MASP Park Add on Fee $454,128 $981,241 $ 1,435,36 9 Subtotal $988,984 $2,136,912 $ 3,125,89 6 Fees Applied Against Prado Road Extension Cost s MASP Transportation Add On $534,856 $1,155,671 $ 1,690,52 7 MASP Park Add on Fee $454,128 $981,241 $ 1,435,36 9 Subtotal $988,984 $2,136,912 $ 3,125,89 6 Remaining Fee Obligations $-$-$ MASP Transportation Add On $-$-$ MASP Park Add on Fee $-$-$ Subtotal $-$-$ Remaining Credit/Reimbursement or (Fees to be Paid)$1,131,265 $25,553 $25,553 Other Eligible Fees : (To be Credited/Used if BP Uses occur prior t o completion of Residential components of Tr 2342 & 2353) Business Park Component (Transportation Add on Fee Only) $(363,550) $(330,500)$ (694,050 ) PH2-3 0 RESOLUTION NO . (2013 Series ) A RESOLUTION OF THE COUNCIL OF THE CITY OF SAN LUIS OBISP O AUTHORIZING THE FINANCE AND INFORMATION TECHNOLOGY DIRECTO R TO CAUSE AN INTERFUND LOA N FOR THE PURPOSES OF CONSTRUCTING A PORTION OF PRADO ROAD FOR TRACT 2342 . WHEREAS, on October 12, 2004 the San Luis Obispo City Council adopted th e Margarita Area Specific Plan ("MASP") by City Council Resolution Number 9615 ; and WHEREAS, Chapter 2 .3 of the City's General Plan Land Use Element identifies th e Margarita Area as a Residential Expansion Area intended to accommodate San Luis Obispo's planned residential growth for the near future ; and , WHEREAS, Prado Road is intended to serve as the primary east-west arterial servin g citywide and vehicle, transit, and bicycle traffic, relieving congestion along South Street & Tan k Farm Road, and providing improved emergency response times in those areas ; and WHEREAS, establishing the east-west connection of Prado Road between Broad Stree t • and Higuera Street at the earliest possible stage of development is a goal of the MASP and Cit y development process . However, because this goal is hindered by multiple and changing propert y ownerships and development phasing of individual properties, revised plans for phase d implementation of Prado Road are necessary ; and WHEREAS, on March 7, 2006, the City Council adopted Resolution Nos . 9776 and 9777, approving, respectively, Vesting Tentative Tract Map ("VTTM's")Nos . 2342 and 2353 ; and WHEREAS, Section 5 .7.2 of the Margarita Area Specific Plan and the Vesting Tentativ e Tract Map Nos . 2342 Condition of Approval 1 .g . provide that the Developer is to pay the costs o f designing, permitting and constructing Prado Road ; and WHEREAS, the City has determined that the most efficient, expedient, and effectiv e approach to coordinate the construction of Prado Road concurrent with the housing developmen t is for the Developer to construct Prado Road; and WHEREAS, Sections 1 .4 and 1 .5 of the Economic Development Strategic Plan call fo r exploring financing strategies for infrastructure that address timing/costs and ensure that that ne w development is responsible for infrastructure costs only to the extent there is a nexus betwee n costs and project impacts ; and, WHEREAS, Section 1 .9 of the Economic Development Strategic Plan contains a strateg y to work with developers that are willing to install infrastructure beyond their "fair share ' requirement as an expedient way to provide new infrastructure in the City's Expansion Areas ; and ,• PH2-35 WHEREAS, in connection with obtaining a building permit for each office, single-famil y and multi-family unit within the Margarita Area Specific Plan area, Margarita Area Specific Plan owners and/or developers are required to pay certain City-wide and Margarita Area Specific Pla n area Impact Fees to the City of San Luis Obispo ; and WHEREAS, the City of San Luis Obispo has adopted Chapter 16 .20 of the San Lui s Obispo Municipal Code to set forth the procedure and conditions for physical improvemen t standards and procedures, including the reimbursement of costs whenever improvements ar e required to be installed adjacent to property other than that being developed or in greater size o r capacity than required for the development of the property under consideration ; and WHEREAS, Reseal LLC . (hereinafter "Developer") will construct a portion of Prad o Road as required by the conditions of approval and that this portion of Prado Road is in greate r capacity as required for the development of the property under consideration; and WHEREAS, Section 9 .53 of the MASP provides that the roadway is constructed an d accepted by the City, fee credits equal to the amount of the cost of the facility or the cost of th e 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 reimbursement agreement for any constructed facility that is oversized ; and WHEREAS, a study prepared by Goodwin Consulting Group, Inc ., concluded tha t construction and related costs to design Prado Road as required by the conditions of approva l would be approximately $2,241,007 and that Tract 2342 MASP transportation fee contributio n for their residential component towards these improvements is approximately $534,856 based o n the MASP fees that took effect on July 1, 2012, leaving an estimated reimbursement amount o f $1,706,151 ; and WHEREAS, subsequent to the preparation of the Goodwin Consulting Group, Inc . report, the developer has received construction bid estimates for the Segment A section of the Prad o Road extension that will reduce this cost to $2,120,250 but will still leave a significant amount o f crediting and reimbursement necessary to compensate developer for advanced costs beyond thei r fair share; and WHEREAS, Section 66006 (b)(G) of the California Government Code allows for th e Interfund loan of development impact fees as defined under California Government Code 6600 0 et seq. if public improvements on which the Interfund loans will be expended is established, th e date on which the loan will be repaid and the rate of interest for the Interfund loan is established ; and WHEREAS, an Interfund loan of $434,128 in Margarita Area Park Fees for th e residential component of Tract 2342 will reduce the estimated amount of reimbursement t o $1,131,265 and that the loan of Margarita Area Park Fee account to the Margarita Are a Transportation Fee account will not impair or delay the delivery of the future park contemplated • • PH2-36 in the MASP as it is estimated that the payment of Margarita Area Park Fees from othe r development with the MASP will be collected prior to the future date when these funds will b e needed to construct this park ; and WHEREAS, The City has found in connection with its review and consideration of this a Interfund loan that no subsequent or supplemental Environmental Impact Report is necessary o r required under CEQA because the credit of fees and reimbursement was analyzed and within th e scope of activities contemplated by the FEIR adopted for the MASP and VTTM's as required fo r implementation of the mitigation measures thereunder . NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Lui s Obispo as follows/or that (whatever action is needed): SECTION 1 .Authorize the Finance and Information Technology Director to loan up t o $454,128 of Tract 2342 MASP Park Improvement Fees account (via crediting) to the MAS P Transportation account for the reimbursement of actual eligible costs for the construction o f Prado Road as determined by the City Engineer, consistent with the approved reimbursement agreements under the terms specified in this Resolution . SECTION 2 . The loan contemplated under this agreement shall be for no more than 1 5 • years and the interest rate shall be as close as administratively practical to the average rate o f return for City investments during the period of said loans as determined by the Finance an d Information Technology Director . Repayment of the loans made under this resolution may b e made at any time without penalty . SECTION 3. Direct the Director of Finance & Information Technology to establish on e or Margarita Area Specific Plan account, or other accounts, as necessary to properly account fo r and track the Interfund loans described and authorized herein. SECTION 4.As required under Section 66006 et seq; the Finance and Informatio n Technology D irector is hereby required to include in the City's annual Comprehensive Annua l Financial Report, outstanding Interfund loan amounts, a description of the improvements o n which the Interfund loan will be expended, repayment amounts and terms of Interfund loans , including but not limited to the date on which the Interfund loan will be repaid . SECTION 5.This Interfund loan does not constitute a debt on behalf of the Genera l Fund and the City does not pledge the full faith and credit of the General Fund in approving thes e Interfund loans as described in this resolution . The Interfund loan shall not directly or indirectl y or contingently obligate the City to levy or pledge any form of taxation whatsoever or make any appropriations for payments . SECTION 6.The City reserves the right pursuant to conditions le of Tracts Resolutio n Nos . 9776 and 9777, approving, respectively, Vesting Tentative Tract Map Nos .2342 and 235 3 to form a community facilities district or other such financing mechanism that would fund an y final project costs for the construction of Prado Road as authorized under the approved VTTM's PH2-37 S conditions of approval that are not contained in the Margarita Area Specific Plan Impact Fe e estimates or to repay the Interfund loan if not repaid during the term as specified in thi s agreement . SECTION 7. Repayment of the interfund loan shall be made from MASP Transportatio n account fees collected from future development located in the Margarita Area . Collected MAS P Transportation Funds from future development other than the Developer shall first repay th e MASP Park Improvement account and once satisfied, may be used to reimburse developer fo r any remaining obligation. Upon motion of , seconded by and on the following vote : AYES : NOES : ABSENT : The foregoing resolution was adopted this 19`h day of February 2013 . ATTEST : Maeve Kennedy Grime s City Clerk APPROVED AS TO FORM : J . Christine Dietric k City Attorney PH2-3 8 Jan Marx Mayor • Attachment 3 • margarita area specific plan build-out #'s Multi-Famil y 32 Multi-Famil y Q';. Multi-Famil y 84 Ownership Areas o too 200 o MO 4(36rsMetersFeet uitimIuIIufl . V P* w3 t all 1111111111111111l City of Unoca l NCI City o f 3 .1...a Multi-1 iarmily Page intentionally left blank . Goodwin, Heather RECEIVE D FEB 19 201 3 SLO CITY CLER K AGENDA CORRESPONDENC E Date 2 11 1 113Remit Piz/I 9 2--- Please distribute this email as Agenda Correspondence for tonight's public hearing items . maeve kenneay cjrnme s City Cler k city Of san lids oBlsp o 990 Palm Stree t San Luis Obispo, CA 9340 1 phone : (805) 781-710 2 email :merimes@slocitv .org From :Mila Vujovich-LaBarre fmailto :milavu©hotmail .com l Sent:Tuesday, February 19, 2013 10 :22 A M Grimes, Maeve ; Marx, Jan ; Lichtig, Katie ; rosemary Alan Thomas; jud e ; Kranzdorf Richard ; Ashbaugh, Joh n ject :Supplemental EIR for the Damon-Garcia Sports Field Area/ Supplemental EIR for Margarita /Airport Are a Specific Pla n Dear Ms Grimes - Thank you for addressing my concerns in our phone chat this morning . In short, I have addressed the City Council for both specific agenda items and during "unscheduled public appearances", written letters, attended LUCE forums and had meetings with City staff i n regard to City development concerns . Very specifically, my friend Rosemary Wilvert and I both asked for a Supplemental EIR for th e Damon-Garcia Sports Fields Area and a Supplemental EIR for the Margarita Area/Airport Area Specifi c Plan at the last City Council meeting verbally two weeks ago . I also submitted several pages o f substantiating details for my request . To date, I have not heard back from anyone . I would like these requests to be formally put on th e City Council agenda . Please forward this email to the City Council members so that at least three o f the five members can vote on this matter .It would help the individuals responsible for City plannin g to appear transparent and responsive . As I mentioned, it was odd for me to learn that two agenda items tonight that deal with Prado Roa d the Margarita Area development . Although I am scheduled to be at a conference until 7pm, I wil l my best to attend tonight's City Council meeting after that time . Sincerely, Heather, Grimes, Maeve Tuesday, February 19, 2013 11 :04 AM Goodwin, Heathe r FW: Supplemental EIR for the Damon-Garcia Sports Field Area/ Supplemental BR fo r Margarita /Airport Area Specific Pla n 1 Mila Vujovich-La Barr e 805-441-581 8 ~lavu@hotmail .co m • 2