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CITY COUNCIL AGENDA ITEM NO. 13

Meeting Date: February 13, 2001

Subject/Title: Northwest Quadrant Infrastructure Design Engineering Fee Reimbursement Agreement, CIP Project No. 336-3127

Submitted by: Engineering: J. Stevenson/P. Eldredge

Approved by: Jon Elam, City Manager

RECOMMENDATION
Approve a Resolution approving the form and content of the Northwest Quadrant Infrastructure Design Engineering Fee Reimbursement Agreement and related actions.

PREVIOUS ACTION
On November 10, 1998, City Council approved the annexation of the Northwest Area into the City of Brentwood.

On May 23, 2000, City Council adopted the 2000/05 Capital Improvement Program.

On November 28, 2000, City Council added the Northwest Quadrant Infrastructure/CIFP 2001-1 to the 2000/05 Capital Improvement Program (CIP Project No. 336-3127) and directed the City Engineer to initiate discussions with the development community to develop a Capital Improvement Financing Program (CIFP 2001-1) to assist in financing the required engineering and public infrastructure to support the anticipated commercial development in the Northwest Quadrant of the City.

BACKGROUND
Staff has had several meetings with the development community related to development of the Northwest Quadrant Infrastructure. The development community has been unanimous in its support and encouragement for this program and has been very helpful in the preparation of the attached agreement and resolution.

The total design cost for the anticipated infrastructure is projected to be between $1.2 and $1.5 million The infrastructure being included in this program includes Lone Tree Way, Fairview Avenue, Heidorn Ranch Road, Sand Creek Road and related sewer, water and storm drain improvements. This is the earliest that the City and the development community have started working on infrastructure in preparation for development. In most cases, the developers will be funding engineering prior to receiving entitlements to build. That is revolutionary in the industry and speaks volumes of the excellent working relationship between the development community and the City of Brentwood.

Attachments:
Resolution
Agreement
Engineering Analysis w/Site Map

RESOLUTION NO. 


A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BRENTWOOD APPROVING THE FORM AND CONTENT OF THE NORTHWEST QUADRANT DESIGN ENGINEERING FEE REIMBURSEMENT AGREEMENT AND RELATED ACTIONS



WHEREAS, on November 10th, 1998, the City Council approved the annexation of the Northwest Area into the City of Brentwood; and

WHEREAS, on May 23rd, 2000, the City Council adopted the 2000/05 Capital Improvement Program; and

WHEREAS, on November 28th, 2000, the City Council added the Northwest Quadrant Infrastructure/CIFP 2001-1 to the 2000/05 Capital Improvement Program and directed the City Engineer to initiate discussions with the development community to develop a Capital Improvement Financing Program (CIFP 2001-1) to assist in financing the required engineering and public infrastructure to support the anticipated commercial development in the Northwest Quadrant of the City; and

WHEREAS, the City Council CIP Subcommittee has reviewed the alternate alignments for Fairview Avenue and instructed City Staff to proceed with the design of the alternate ‘A’ alignment in order to improve traffic safety and relocate Fairview Avenue so it can continue to function if Lone Tree Way is reconstructed for a grade separation with the railroad; and

WHEREAS, numerous property owners have expressed an interest in developing within or adjacent to the Northwest Quadrant; and

WHEREAS, the public infrastructure within the Northwest Quadrant is only sufficient to handle approximately 20% of the proposed residential development; and

WHEREAS, the property owners in the Northwest Quadrant have requested the City’s assistance in developing the Northwest Quadrant public infrastructure through the formation of CIFP 2001-1 and by negotiating a design engineering fee reimbursement agreement; and

WHEREAS, the City Council and the Northwest Quadrant property owners desire to maintain Brentwood’s high standard of living and quality of life; and

WHEREAS, the City Council has directed City staff to see that public infrastructure is constructed early in the development process.

NOW, THEREFORE BE IT RESOLVED that the Council approves the attached Design Engineering Fee Reimbursement Agreement and takes the following actions:

1. Authorize the City Manager to sign and execute the Northwest Quadrant Design Engineering Fee Reimbursement Agreement with property owners developing property within or adjacent to the Northwest Quadrant;

2. Direct the Community Development Director and the City Engineer to require the submittal of a signed Northwest Quadrant Design Engineering Fee Reimbursement Agreement and a check in the amount of the property owners’ fair share of the design engineering costs associated with the design of the Northwest Quadrant public infrastructure at the time of submittal of their package for entitlement, submittal of plans for plan check, or prior to agendizing for the Planning Commission or City Council for projects already being processed at the time this resolution is approved;

3. Direct the City Engineer to expedite the calculation of fair share allocations so as not to delay submittals or processing within or adjacent to the Northwest Quadrant;

4. Direct the City Engineer to sign the contracts with the design consultants for the designated Northwest Quadrant public infrastructure and direct them to begin design;

5. Direct the City Finance Director to fund one half of the commercial projects’ traffic related design costs through the City Development Roadway Fee Account and to cover any shortfall in design costs until additional funds are collected from subsequent developers within or adjacent to subject area during the design process;

6. Direct the City Finance Director to establish a separate account for these Northwest Quadrant design engineering fees; and

7. Direct the City Finance Director to reimburse any excess funds plus interest collected on these funds on a proportional and pro-rated basis to the contributing property owners after the design is complete, the CIFP bonds are sold and the City has been reimbursed for its design contribution if so required.

PASSED, APPROVED AND ADOPTED by the City Council of the City of Brentwood at a regular meeting held on the13th day of February, 2001 by the following vote:

AYES: Councilmembers
NOES: 
ABSENT: 



REIMBURSEMENT AGREEMENT


THIS AGREEMENT (“Agreement”) is entered into at Brentwood, California, this ____th day of _____________, 2001, by and among the CITY OF BRENTWOOD, a municipal corporation (“City”) and, _____________________, a _______________ and ___________________, a ______________ (collectively “Developer”).

A. Developer is a fee owner or has another real property interest in that certain real property located in the City of Brentwood, County of Contra Costa, State of California, commonly known as “The Northwest Quadrant,” consisting of approximately 1200 acres and the real property located adjacent to (within 1/4 mile) of the Northwest Quadrant, (collectively referred to as “Property”), as shown in the attached Exhibit A, entitled "Northwest Quadrant Design Engineering Analysis." Various public improvements are required to be constructed as a condition of approval of new development that exceeds the current public infrastructure capabilities; current public infrastructure capabilities are estimated to accommodate only 20% of the proposed new development in the Property without these new public improvements.

B. In connection with the development of the Property, Developer intends to pay for the design engineering of certain needed public improvements for the Property, including, but not limited to, the engineering design for Lone Tree Way (between Heidorn Ranch Road and Fairview Avenue), Heidorn Ranch Road (between Lone Tree Way and Sand Creek Road), Fairview Avenue (between Lone Tree Way and Minnesota Avenue), and Sand Creek Road (between Route 4 Bypass and Heidorn Road) and other related public improvements as more fully described in Exhibit A attached hereto and incorporated herein by this reference (collectively, “Improvements”) that will benefit the Property and other properties throughout the City. The Improvements will contain supplemental width, length, size and capacity relative to the demand generated by the Property that can be used by other anticipated development throughout the City.

C. Pursuant to the Subdivision Map Act (Government Code section 66410, et seq.) the Developer has requested and is entitled to reimbursement for that portion of the costs of the design of the Improvements, including amounts attributable to interest and administration costs, as described in the Brentwood Development Fee Program (“Reimbursable Costs”). City agrees to administer the reimbursement of costs to Developer, as set forth herein.

NOW, THEREFORE, it is agreed as follows:

Section 1. Design of Improvements.

The Improvements to be designed will benefit other properties throughout the City. Pursuant to sections 66485, et seq. of the Subdivision Map Act and Brentwood Municipal Code Chapter §16.120 and the Brentwood Development Fee Program, Developer is entitled to recover a portion of the engineering design of Improvements as described in Exhibit A. The design engineering of the Improvements and other related work, which are subject to reimbursement pursuant to this Agreement and the Development Fee Program, are more fully described in Exhibit A.

A. The City shall manage the design of the Improvements and establish a reasonable schedule for the design in consultation with the Developer to imput specific design criteria related to its individual developments including:

a) Utility stubs of sufficient size and location;
b) Project access points with turn pockets and appropriate signing and striping;
c) Sleeving for future utility crossings and signalization;
d) Joint utility trench location and sizing of joint utilities; and
e) Other design considerations as appropriate to preclude the need to modify or disturb the Improvements once constructed.

The Developers input to this design must be made in a timely manner so as not to delay the final approval of the design. The City Engineer shall make the final determination of a final cut-off date for Developer input without delaying the design.

Section 2. Reimbursable Costs.

An estimate of costs for the design of the Improvements and other related items is set forth in Exhibit A. Within sixty (60) days after completion of the design of the Improvements and sale of the CIFP bonds, the City Engineer of the City (“City Engineer”) shall review the design costs to determine if the same exceeds the estimate of costs set forth in Exhibit A. For those costs exceeding the estimate therefor set forth in Exhibit A, the City Engineer shall review such excess costs for appropriateness using a standard of reasonableness based upon normal and accepted costs in the industry. If the City Engineer determines that any item in the design, which is in excess of the estimate therefor on Exhibit A is inappropriate or excessive, the item may be adjusted accordingly. The City Engineer shall make the final determination as to permissible costs. Reimbursement from City shall be based upon the Statement of Costs as approved by the City Engineer, but the amount shown in the statement of costs shall not exceed the amount stated in this Agreement, Section 4, Reimbursement.

Section 3. Ownership of Design.

City shall own the design of the Improvements after the City Engineer accepts such design. Thereafter, Developer shall have the right to use the design or any portion of the design of the Improvements in accordance with City regulations and the right to reimbursement for the Reimbursable Costs for the design of the Improvements, as provided herein.


Section 4. Reimbursement.

The City shall reimburse Developer from development fees collected from Developer when Developer requests any building permits for the Improvements. City will reimburse Developer from facility fee credits for the costs associated with the design engineering fee (i.e., roadway improvement design engineering will be reimbursed from roadway fee credits). The amount of the reimbursement credit will be distributed on a pro-rata share over the Developer's total number of units and traffic generation as shown in Exhibit A. Any fee credit shall not exceed the fee set forth in Exhibit A, except for interest payments. If assessment district bonds are sold against Developer’s property, these costs may be included in those bonds and the City shall pay Developer at the time bond proceeds are distributed.

If the Developer’s proposed development is not approved by the Planning Commission or City Council, the City shall reimburse Developer all design engineering fees contributed to this program by the Developer plus any City Engineer authorized extra work paid by the Developer and any accrued interest, as provided in this Agreement and the Development Fee Program, for the design of the Improvements over a period not to exceed ten (10) years from the date of the City’s acceptance of the design of the Improvements. Such reimbursement payments shall be made on an annual basis, subject to the terms of this Agreement, thirty (30) days after the Determination Date in any calendar year (“Payment Date”). It is understood and agreed that the City shall distribute any Reimbursement Fee, as hereinafter defined, provided by this Agreement to Developer, or their successors in interest or assigns, as provided in Exhibit A.

The City staff agrees to recommend approval of the commercial developments within or adjacent to the Northwest Quadrant subject to their participation in this program. Staff has determined that the existing infrastructure in this area of the City is not sufficient to support residential development beyond 20% of the units within each development without construction of the improvements designed through this agreement. If the planned assessment district bonds are not sold by February 28, 2002, staff will consider recommending approval of residential development in excess of the 20% threshhold if the Developer agrees to the following terms:

a) Developer pays to the City 105% of the CIFP Engineer’s Report Fair share responsibility of infrastructure construction costs; and
b) Developer agrees to pay or to include as a lien assessment any difference between the estimate of the CIFP Engineer’s Report Fair Share responsibility of infrastructure costs and the actual costs imposed as part of the assessment district; and
c) Developer and City are able to develop adequate infrastructure to serve the development.

It is understood among the parties that the City does not guarantee approval of any project submitted by a Developer as a result of Developer's payment of its pro-rata share under this agreement.

It is anticipated by the parties to this agreement that an assessment district will be created to fund the construction of over $30 million in public improvements, including public sewer, public water, storm drain, fire protection, and street and lighting in the Property area. The Developer agrees to participate in the formation of such assessment district(s) and agrees not to protest the formation of such assessment district(s) as needed to fund the needed public improvements in the Property area, but does not waive its rights to protest the amount of the assessment proposed to be placed as a lien on its property.

Section 5. Developer's Share.

Developer's share of the costs of the design of the Improvements shall be deemed contributed upon the City Engineer's acceptance of the design of the Improvement, subject to the receipt of the Reimbursable Costs as herein provided.

Section 6. Establishment of Fee.

The City shall collect from the benefited property owners within Property area the Northwest quadrant Design Engineering Fee, as provided in Brentwood Municipal Code Chapter 16.120 in the amount and manner described in Exhibit A and as stated in Section 4 (“Reimbursement Fee” or” Reimbursement Fees”).

Section 7. Interest.

Simple interest at the rate of four percent (4%) per annum shall be added to the outstanding balance owed to Developer as described in Sections 4 and 6 herein beginning with the date following the City Engineer's acceptance of the Improvements design.

Section 8. Time of Collection.

The City shall require payment of the Reimbursement Fee at the time of the Developer's initial submittal for entitlement, or submittal of plan checking, or as a condition of approval of a tentative map, final parcel map, final subdivision map, or the issuance of a building permit for any development of the Property, whichever occurs first. The City shall attempt to collect the Reimbursement Fee at the time of the filing of any discretionary permit, including a filing of a tentative subdivision map or parcel map for buildable lots or upon the issuance of a building permit for any development on the Property.



Section 9. Manner of Disbursement.

The right to the Reimbursement Fees shall be personal to Developer and shall continue notwithstanding the subsequent sale or transfer of the Property. Developer shall have the right, in their sole discretion, to assign their interest to the Reimbursement Fees to another person or entity at any time by providing the City written notice of such assignment.

Developer hereby direct that any Reimbursement Fee due to Developer shall be payable in the percentages stated in Exhibit A and mailed, respectively to:

Developer Name
Address



Developer may change the payee and/or address of payments by notice in writing to City, such notice to be effective upon receipt by City.

Section 10. Term.

On the Payment Date that follows the date that is ten (10) years after the date of acceptance of the design of the Improvements by the City Engineer, City shall either have paid Developer all the amount due and owing as a result of this Agreement or this Agreement shall terminate.

Section 11. Disputes.

Disputes arising under this Agreement shall be filed with the City Engineer, who shall be authorized to resolve such disputes. Any decision or resolution of such dispute made by the City Engineer with respect to this Agreement may be appealed to the City Council. Any such appeal to the City Council must be made in writing and addressed to the City Clerk. A final action or decision of the City Council shall be required before legal action pursuant to this Agreement may be instituted. Notwithstanding the foregoing, either party may, in addition to any other rights or remedies, institute legal action to cure, correct or remedy any default, enforce any covenant or agreement herein, enjoin any threatened or attempted violation or enforce by specific performance the obligations and rights of the parties hereto. The prevailing party in any legal action shall be entitled to its attorneys' fees and costs, if any, in addition to any other relief to which such party may be entitled.

Section 12. Applicable Law.

The laws of the State of California shall govern the interpretation and enforcement of this Agreement.

Section 13. Counterparts and Exhibits.

This Agreement is executed in duplicate counterparts, each of which is deemed to be an original. This Agreement and its Exhibits constitute the entire understanding and agreement of the parties. This Agreement and its Exhibits integrate all of the terms and conditions mentioned herein or incidental hereto, and constitute the entire understanding of the parties with respect to the subject matter hereof, and all prior written agreements, understandings, representations, and statements are terminated and superseded by this Agreement.

THIS AGREEMENT is executed as of the date and year first above written.

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