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 CITY COUNCIL AGENDA ITEM NO. 17



Meeting Date: September 10, 2002

Subject/Title: Approving a Reimbursement Agreement with Brentwood Partners, LLC Concerning Subdivision Map No. 8617 

Submitted by: Engineering: B. Grewal/P. Eldredge

Approved by: John Stevenson, City Manager


RECOMMENDATION 
Approve a Resolution approving a Reimbursement Agreement with Brentwood Partners, LLC, concerning Subdivision Map No. 8617 improvements that will contain supplemental width, length, size and capacity. 

PREVIOUS ACTION
The developer of Subdivision Map No. 8617, Brentwood Partners, LLC, is a fee owner of the recently approved commercial development that included the Winco Store located in the City’s Northwest Quadrant. Various public improvements are required to be constructed by Brentwood Partners, as a condition of approval of its new development that exceeds the current public infrastructure capabilities. City and Developer acknowledge that Developer will likely use the same general contractor for its private on site construction as for the required off-site and over sizing public improvements. A separate accounting will be completed to separate the over sizing and public improvements from the private on site improvements. 

In connection with the development of the Property, Developer is required to construct certain needed public improvements for the property, including, but not limited to, a portion of Lone Tree Way and other related public improvements as more fully described in “Exhibit A” of the Reimbursement Agreement (collectively, “Improvements”) that will benefit the Brentwood Partners’ 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. Pursuant to the Subdivision Map Act (Government Code section 66410, et seq.), Brentwood Municipal Code Chapter §16.120 and the Brentwood Development Fee Program, Brentwood Partners has requested and is entitled to reimbursement for that portion of the costs of the construction of the Improvements, including amounts attributable to interest and administration costs (“Reimbursable Costs”). City agrees to administer the reimbursement of costs to Developer from other benefited property, as set forth in the Reimbursement Agreement.

The City has already contracted for the design of the improvements and obtained all environmental permits, rights of entry and right of ways, and has established a reasonable schedule for completion of these items to prevent project delays or possible project cost overruns. Developer has agreed to manage the construction of the Improvements and establish a reasonable schedule for the construction in consultation with the City.

A bid from at least three general contractors was obtained. The lowest bid for the supplemental oversized portion of the construction costs for the improvements and other related items is approximately $6,200,000. The City has reviewed the bid costs and recommends the approval, as reviewed and approved by the City Engineer. Construction management costs, preliminary administration and engineering costs and interest carrying costs shall also be reimbursed, as set forth in “Exhibit A” of the Reimbursement Agreement. 

FISCAL IMPACT
The Reimbursement Agreement will be funded from development fees from the Brentwood Partners’ development and money generated from the sale of bonds from $16,585,000 Brentwood Infrastructure Financing Authority CIFP 2002-1 Infrastructure Revenue Bonds. 


Attachments:
Resolution
Site Map
Agreement

RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BRENTWOOD APPROVING A REIMBURSEMENT AGREEMENT WITH BRENTWOOD PARTNERS, LLC, CONCERNING PUBLIC IMPROVEMENTS FOR SUBDIVISION MAP NO. 8617. 


WHEREAS, Brentwood Partners, LLC is a fee owner of the recently approved commercial development that included the Winco Store located in the Northwest Quadrant area; and 

WHEREAS, various public improvements are required to be constructed by Brentwood Partners, as a condition of approval of its new development that exceeds the current public infrastructure capabilities; and

WHEREAS, a separate accounting will be completed to separate the over sizing and public improvements from the private on site improvements; and

WHEREAS, Brentwood Partners, LLC, is required to construct certain needed public improvements for the property, including, but not limited to, a portion of Lone Tree Way and other related public improvements that will benefit Brentwood Partners as well as other properties throughout the City; and

WHEREAS, 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; and

WHEREAS, pursuant to the Subdivision Map Act (Government Code Section 66410, et seq.), Brentwood Municipal Code Chapter §16.120 and the Brentwood Development Fee Program, Brentwood Partners has requested and is entitled to reimbursement for that portion of the costs of the construction of the improvements, including amounts attributable to interest and administration costs (“Reimbursable Costs”).

NOW, THEREFORE BE IT RESOLVED that the City Council approves the Reimbursement Agreement, attached hereto as Exhibit A, and authorizes the City Manager to execute the Agreement for approximately $6,200,000 for Brentwood Partners, LLC.

PASSED, APPROVED AND ADOPTED by the City Council of the City of Brentwood at a regular meeting held on the 10th day of September 2002 by the following vote:

REIMBURSEMENT AGREEMENT


THIS AGREEMENT (“Agreement”) is entered into at Brentwood, California, this 10 the day of September 2002, by and among the CITY OF BRENTWOOD, a municipal corporation (“City”) and, BRENTWOOD PARTNERS LLC, a California limited liability company (“Developer”).

A. Developer is a fee owner or has other real property interests 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 as shown in the attached Exhibit A, entitled "Northwest Quadrant Improvements." 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 Northwest Quadrant without these new public improvements.

B. City and Developer acknowledge that Developer will likely use the same general contractor for its private on site construction as for the required off-site and oversizing public improvements. A separate accounting will be completed to separate the oversizing and public improvements from the private on site improvements. 

C. In connection with the development of the Property, Developer is required to construction certain needed public improvements for the Property, including, but not limited to, a portion of Lone Tree Way 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.

D. 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 construction of the Improvements, including amounts attributable to interest and administration costs (“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. Improvements.

The Improvements to be constructed 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 construction of Improvements as described in Exhibit A. The construction of the Improvements and other related work, which are subject to reimbursement pursuant to this Agreement, are more fully described in Exhibit A.

A. The City shall contract for the design of the Improvements and obtain all environmental permits, rights of entry and right of ways, and shall establish a reasonable schedule for completion of these items to prevent project delays or possible project cost overruns.

B. Developer shall manage the construction of the Improvements and establish a reasonable schedule for the construction in consultation with City.

The input from either the City or Developer to all construction issues must be made in a timely manner so as not to delay the construction of the Improvements. However, both parties hereby acknowledge that the plans are only 95% completed and additions that are mutually approved by both parties are expected to be made to the plans. The City Engineer shall make the final determination of any changes to the as bid construction plans, approval of any change orders, or increases in reimbursement costs to the Developer.

Section 2. Reimbursable Costs.

An estimate of construction costs for the Improvements and other related items is set forth in Exhibit A. Within five (5) working days of receipt of the Contractor’s bids, the Developer shall review the bids and propose the best overall bid and recommend a Contractor to the City. The City Engineer of the City (“City Engineer”) shall review the as bid construction costs and the recommendation from the Developer 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 construction bid, which is in excess of the estimate therefor on Exhibit A is inappropriate or excessive, the City Engineer may ask the Developer to attempt to negotiate a reduction in cost for that item. Should agreement not be reached on an appropriate construction costs, the City Engineer may ask that the items of contention be removed from the project, and the Construction Contract and reimbursement list in Exhibit A 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, except as approved by City Engineer.

Construction management costs, preliminary administration and engineering costs and interest carrying costs shall also be reimbursed as set forth in Exhibit A. 

Section 3. Ownership of Improvements.

City shall own the design of the Improvements. Developer shall be responsible for the Improvements until the City accepts the Improvements. City and Developer agree that partial improvements as set forth in Exhibit A may be accepted by the City Council prior to completion of all Improvements. After the City Council accepts the Improvements, thereafter, Developer shall have the right to use the Improvements or any portion of the of the Improvements in accordance with City regulations and the right to reimbursement for the Reimbursable Costs for the construction of the Improvements, as provided herein.

Section 4. Reimbursement, City and Developer Responsibilities.

The City shall reimburse Developer from the Northwest Quadrant CIFP and by crediting Developer’s development fee obligations for Frontage and Roadway Impact Fees (“Fees”) for constructed improvements

It is understood and agreed that the City shall distribute any Reimbursement or Fee Credit, as hereinafter defined, provided by this Agreement to Developer, or their successors in interest or assigns, as provided in Exhibit A.

Staff has determined that the existing infrastructure in this area of the City is not sufficient to support commercial and residential development beyond 20% of the planned build out of the total North West Quadrant without construction of the improvements covered by this agreement. If the planned assessment district bonds are not sold by September 15, 2002, it is anticipated by the parties to this agreement that the total improvements will be reduced by agreement between the Developer and the City to a level sustained by the Developer’s obligation fees and by the City’s ability to provide such other reimbursement to complete the reduced improvements. 

Developer agrees to require a minimum of three bids and require the selected general contractor to name the City as additional insured and to indemnify and hold the City harmless from any and all claims, lawsuits, or disputes concerning the general contractor’s work. Developer shall also require the contractor to pay prevailing wages for all public improvements that the City Council accepts. Developer shall enter into a contract for construction of the Improvements with the successful contractor. Such contract shall be 

City agrees to review payment requests, make regular inspections of the Improvements, and recommend to the City Council work that is completed and acceptable to the City Engineer in various stages, as stated in Exhibit A. Developer shall notify the City Engineer in writing of the completion of the various stages of Improvements as outlined in Exhibit A. City shall inspect and recommend acceptance to the City Council within five (5) working days, or hold the recommendation until the public improvements are acceptable to City Engineer. City agrees to recommend acceptance to the City Council if the public improvements have been built in accordance with the approved plans and specifications.

City agrees to obtain all rights of way and environmental clearances and to pay for any bonds and insurance for the Improvements. Developer shall manage the general contractor, make payments to the contractor in accordance with the terms of the construction contract, make payment requests to the City as provided in Exhibit A, request change orders from the City prior to construction, and provide support services for the construction of the Improvements. City shall pay for any inspection that it requires. City agrees to review, comment, and accept material submittals in sufficient time so as not to unreasonably delay the construction schedule provided the submittals are timely and complete. Any testing, including but not limited to soil testing, compaction testing, etc. shall be the responsibility of the Developer. 

The City and Developer agree that in order to maximize the bonding capacity of the property for an assessment district, the developer’s Tentative Map or Entitlement Action has already been approved by the City prior to the sale of bonds. The Developer may choose to drop the development from the assessment district and enroll it in the next assessment district, or the Developer may choose to pay their fair share responsibility as identified by the Engineer’s Report as direct reimbursement for the construction of a portion of the Improvements rather than participate in the assessment district.


Section 5. Developer's Share.

Developer's share of the costs of the Improvements construction shall be deemed contributed upon the City Council’s acceptance of the Improvements.


Section 6. Interest.

Developer shall pay the contractor based on the terms of the construction contract regardless of whether such payments coincide with the schedule of reimbursements as provided for in Exhibit A. The accumulation of such payments shall become an outstanding balance owed to Developer by the City until such time as they are paid by City in accordance with the reimbursement schedule in Exhibit A. Simple interest at the rate of twelve percent (12%) per annum shall be added to the outstanding balance owed to Developer beginning upon payment by Developer to contractor. Payments to Developer by City for reimbursable items as listed in Exhibit A shall be made within ten (10) days from the date of the City Council’s acceptance of the various stages of the Improvements set forth in Exhibit A. Payments made later than ten (10) days after Council acceptance shall be subject to the addition of simple interest as defined in this section.

Section 7. 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 directs that any Reimbursement Fee due to Developer shall be payable in the percentages stated in Exhibit A and mailed, respectively to:

Gordon Davis
Brentwood Partners, LLC
1035 NW Hoyt Street
Portland, OR 97209

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 8. Term.

City agrees to pay Developer as stated in Exhibit A and shall be completed in the time provided in Exhibit A. 

Section 9. 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 10. Defense of Claims from Contractor.

The City acknowledges that the City Engineer makes all final determinations as to the interpretation of Plans provided by the City, authorization of modifications and change orders to the plans, and authorization of additional costs to the Developer. As such, the City agrees to pay all costs to defend Developer against all claims from the Contractor or Sub Contractors.

Section 11. Applicable Law.

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

Section 12. Benefit Assessment District and Issuance of Certificate of Entitlement.

The City and Developer agree that the Developer has also been required to include supplemental width, length, size and capacity for stormwater, sewer, water, traffic light improvements, and some private roadway improvements that will benefit adjacent property owners. The precise percentage of benefited properties has not yet determined as public notice and adjacent property owners have not been given an opportunity to review the percentage and estimated or actual cost to provide the supplemental width, length, size, and capacity for the above described public and private improvements that will benefit their property if developed. 

Based on the City Manager’s recommendation, hereby acknowledged, City and Developer hereby agree to form a benefit assessment district and to issue a certificate of entitlement, pursuant to Brentwood Municipal Code Section 16.120.100, to address the private and public improvements that will benefit adjacent property owners. The exact terms of the benefit assessment district agreement shall be presented to the City Council for its approval at a later date. This provision is to memorize the understanding between the parties to form the assessment district. 


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.


CITY OF BRENTWOOD BRENTWOOD PARTNERS, LLC


By: By: ______________________________
John Stevenson, City Manager Gordon Davis, Vice President



Attest:



______________________________
Karen Diaz, CMC, City Clerk


Approved as to form:


______________________________
Dennis Beougher, City Attorney




City Administration
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