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CITY COUNCIL AGENDA ITEM NO. 2

Meeting Date: November 9, 2004

Subject/Title: Approve a Resolution approving a Reimbursement Agreement with Ponderosa Homes II, Inc., A California Corporation, Subdivision Map No. 8529, for costs associated with Master Plan Facility Improvements.

Prepared by: Engineering: L. Vargas

Submitted by: Engineering: B. Grewal

RECOMMENDATION
Approve a Resolution approving a Reimbursement Agreement with Ponderosa Homes II Inc., a California Corporation, Subdivision Map No. 8529, located west of Minnesota Avenue and north of Sand Creek Road, consisting of 56 lots, for costs associated with Master Plan Facility Improvements.

PREVIOUS ACTION
On April 12, 1994, City Council approved Resolution No. 94-63, which established a standard Reimbursement Agreement for Master Plan Facility Improvements.

On September 18, 2001, the Planning Commission of the City of Brentwood approved Planning Commission Resolution No. 01-67, which approved the PD-26 Amendment, Tentative Subdivision Map No. 8529 with conditions and Design Review No 01-23.

BACKGROUND
The Conditions of Approval for Tentative Subdivision Map No. 8529 required the Developer to construct certain excess capacity Master Plan Facility Improvements. When a developer constructs these improvements, they provide capacity in excess of the needs of their development. The Subdivision Map Act requires that the City enter into a reimbursement agreement when requiring the developer to construct excess capacity or off-site improvements.

The Master Plan Improvements that qualify for reimbursement in this agreement are the park design and construction, purchase of land for the park and oversized landscape and irrigation in the parkway along Sand Creek Road. Facility fees will also be reduced by the amount pre-paid through CIFP 2004-1. A careful review by staff of the Conditions of Approval and finalized plans has resulted in a savings to the City. If final constructed quantities or items change, the agreement may be modified to reflect those changes. The City has agreed to purchase back any remaining fee credits at a 25% reduction, payments will begin after the last building permit and the buy back shall not take longer than three years. The City Engineer and Finance Directors have reviewed this agreement.

FISCAL IMPACT
Facility Fees to be collected will be reduced by pre-payment of fees; fee credits will be given for Master Plan Improvements constructed. An agreement with the Developer to buy back remaining park credits at a 25% discount, with payments occurring over a three year period.

Attachments: Resolution
Reimbursement Agreement with Site Map

RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BRENTWOOD APPROVING A REIMBURSEMENT AGREEMENT WITH PONDEROSA HOMES II, INC., A CALIFORNIA CORPORATION, SUBDIVISION MAP NO. 8529 FOR COSTS ASSOCIATED WITH MASTER PLAN FACILITY IMPROVEMENTS.


WHEREAS, on September 18, 2001, Planning Commission adopted Planning Commission Resolution No. 01-67, which required the Developer of Tentative Subdivision Map No. 8529 to construct certain Master Plan Facility Improvements; and

WHEREAS, on April 12, 1994, City Council approved Resolution No. 94-63, which established a standard Reimbursement Agreement for Master Plan Facility Improvements; and

WHEREAS, certain Master Plan Facility Improvements are reimbursable under the City of Brentwood Master Plan Facility Fee Program; and

WHEREAS, the Developer will construct the Master Plan Facility Improvements eligible for reimbursement.

NOW, THEREFORE BE IT RESOLVED that the City Council of the City of Brentwood does hereby approve a Reimbursement Agreement with Ponderosa Homes II, Inc. for Master Plan Improvements constructed in conjunction with Subdivision Map No. 8529 covered under Tentative Subdivision Map No. 8529, as shown on the Reimbursement Agreement Site Map.

PASSED, APPROVED AND ADOPTED by the City Council of the City of Brentwood at a regular meeting on the 9th day of November 2004 by the following vote:




















REIMBURSEMENT AGREEMENT
BRENTWOOD MASTER PLANNED FACILITIES
PONDEROSA HOMES II, INC.
SUBDIVISION MAP NO. 8529

1. PARTIES AND DATE

This Agreement is made this 9th of November, 2004 by and between the City of Brentwood, California, a Municipal Corporation (“City") and Ponderosa Homes II, Inc., A California Corporation ("Developer").

2. RECITALS

2.1 The Developer owns Subdivision No. 8529 in the City ("Developer's Property") located north of Sand Creek Road, west of Minnesota Avenue, included within the original Tentative Subdivision Map No. No. 8529 described in Exhibit "A" attached hereto consisting of fifty six (56) lots.

2.2 As a condition to the development of developer's property, City required Developer to design, construct and install offsite or excess capacity Master Plan Improvements (“Improvements”). The Improvements are identified in the CITY OF BRENTWOOD 2004 DEVELOPMENT FEE PROGRAM dated February 10, 2004. Improvement plans will be completed and approved by the City pursuant to Chapter 16.04 of the Code and are described in more detail in Exhibit "B" attached hereto.

2.3 Developer is willing to advance the costs of designing, financing, constructing, installing and inspecting the approved facilities subject to facility fee credits and reimbursements over time from the City.

2.4 City has found that this Agreement is in accordance with the requirements of Sections 16.130.030 and 16.130.040 of the Code and California Government Code Sections 66485 through 66489.

3. TERMS

3.1 Design and Construction of Improvements. Developer shall be solely responsible for designing, financing constructing, installing, providing for the inspection and bonding of the improvements. The improvements shall be fully completed and ready for acceptance within the time period set forth in the Subdivision Map Conditions of Approval. City shall approve the plans and specifications for the work prior to construction of the Improvements by Developer. The design, construction and installation of the Improvements shall be to the satisfaction of City in its sole and reasonable discretion.

3.2 Source and Method of Reimbursement. City shall reduce facility fees collected from the Developers for Developer’s property by the amount of prepaid assessment district fees. City shall reimburse Developer in the form of facility fee credits for the costs associated with the design, financing, construction and installation of the Improvements indicated in “Exhibit B Reimbursable Improvements”. The amount of the reimbursement credit shall be distributed on a pro-rata share over the developer's total number of residential units. In no event shall the fee credit exceed the fee for a given fee category. The total reimbursable amount is indicated in “Exhibit C Reimbursement Calculation" attached hereto. In the event that fee credits are insufficient to provide full reimbursement, the City shall purchase the remaining fee credits at a 25% discount with payments to be made over a three (3) year period. The first annual payment shall be made within thirty days after all permits for this subdivision have been pulled. The amount reimbursed on an annual basis shall be one-third of the reimbursable balance after deduction for credits taken, deduction for the agreed upon twenty-five percent discount and any other payments previously made by City to Developer. Payment in full to be completed over a three year period. As an alternative to annual payments of remaining funds, the Developer may transfer the reimbursement balance due them to any other project owned or under contract by Developer in the City, in the form of fee credits. Transferred credits shall be applied to like development fee funds and no other.
3.3 Term of Reimbursement Obligation. The City's obligation to reimburse the Developer shall continue for three years from the date the Developer is first eligible for an annual reimbursement, unless the obligation is sooner satisfied.

3.4. Maximum Reimbursement. The total amount of the reimbursement obligation over the life of this Agreement for Improvements described in Exhibit "B Reimbursable Improvements" shall be as determined by the CITY OF BRENTWOOD 2004 DEVELOPMENT FEE PROGRAM. The parties acknowledge and agree that the maximum reimbursements and prepaid fees under this agreement, before any discounts, are estimated to be ONE MILLION SIX HUNDRED THIRTY THREE THOUSAND TWENTY ONE DOLLARS AND 25 CENTS ($1,633,021.25).

3.5 Inspection. The City shall have the right at all times to inspect the construction of the Improvements to measure compliance with City plans and specifications.

3.6 Areas and Quantities. The areas and quantities used to develop this agreement are the best estimates available at the time. The actual areas and quantities may change at the time of dedication to the City and/or construction by Developer. If it is reasonably determined by the City Engineer that the areas and quantities have changed, the reimbursable amount may be adjusted accordingly.

3.7 Indemnity and Insurance
(1) Developer shall defend, indemnify and hold City, its elected officials, officers, employees, and agents free and harmless from any and all liability from loss, damage, or injury to or death of persons or property in any manner arising out of or incident to Developer's performance of this agreement, including without limitation all consequential damages, attorney's fees and court costs, whether or not resulting from the negligence of Developer or Developer's agents. This indemnity shall extend to any claims arising because Developer has failed to properly secure any necessary easements, land rights, contracts, or approvals, but shall not extend to any claims arising out of the sole negligence of City. This indemnity shall also extend to any legal action commenced by any third party against the City challenging the terms of this agreement or seeking judicial review.
(2) Developer shall require all persons doing work on the improvements, including its contractors and subcontractors, to obtain and maintain insurance of the types and in the amounts described below in a form and with carriers satisfactory to City.

a. Commercial General Liability Insurance. Developer shall maintain occurrence version commercial general liability insurance or equivalent form with a limit of not less than $2,000,000.00 (or as otherwise approved, in writing, by the City). If such insurance contains a general aggregate limit, it shall apply separately to this agreement or be no less than two times the occurrence limit. Such insurance shall:
i. Name City, its officials, officers, employees and agents as insured by endorsement with respect to performance of this agreement and contain no special limitations on the scope of its protection afforded to the above-listed insured; and
ii. Be primary with respect to any insurance or self-insurance programs covering City, its officials, officers, employees and agents; and
iii. Contain standard separation of insured provisions.

b. Business Automobile Liability Insurance. Developer shall maintain business automobile liability insurance or equivalent form with a limit of not less than $1,000,000.00 each accident. Such insurance shall include coverage for owned, hired and non-owned automobiles and shall contain the provisions set forth in subsections (a) (i) - (iii) set forth directly above.
c. Worker's Compensation Insurance. Developer shall maintain during the life of this agreement, worker's compensation insurance for all Developer’s employees employed at the site of the work and in case of any work that is sublet, Developer shall require any general contractor or subcontractor similarly to provide Worker’s Compensation Insurance for contractor’s or subcontractor’s employees, unless such employees are covered by the protection afforded by Developer. If any class of employee engaged in work under this agreement at the site of the project is not protected under any workers’ compensation law, Developer shall provide and shall cause each contractor and subcontractor to provide, adequate insurance for the protection of employees not otherwise protected. Developer hereby indemnifies City for any damage resulting to it from failure to take out or maintain such insurance. Developer shall also maintain workers compensation insurance with statutory limits and employer's liability insurance with limits of not less than $1,000,000.00 each accident.

d. Other insurance Requirements. Developer shall:
i. Prior to taking any actions under this Agreement, furnish City with properly executed certificates of insurance which shall clearly evidence all insurance required in this section and provide that such insurance shall not be canceled, allowed to expire or be materially reduced in coverage except on thirty (30) days prior written notice to City.
ii. Provide to City certified copies of endorsements and policies if requested by City, and properly executed certificates of insurance evidencing the insurance required herein.
iii. Replace or require the replacement of certificates, policies and endorsements for any insurance required herein expiring prior to completion and acceptance of the Improvements.
iv. Maintain all insurance required herein from the time of execution of this Agreement until the acceptance of the Improvements by City; and
v. Place all insurance required herein with insurers licensed to do business in California.

3.8 Commencement of Construction and Inspection. Developer and its contractor or subcontractors shall not commence construction of the Improvements until Developer has received written authorization from City to proceed. Written authorization may be in the form of signed approved plans along with permit issuance. All work performed on the Improvements shall be done in strict compliance with City approved plans, specifications and the contract documents and in a good and workmanlike manner. All work performed by Developer, its contractor or agents to construct the Improvements shall be subject to inspection by City. All fees and costs to construct the Improvements shall be borne solely by Developer, subject to reimbursement as provided herein. Inspection by City or its employees or agents shall not relieve Developer of its liability for design defects or improper or inadequate workmanship.

3.9 Compliance with Applicable Laws. Developer shall insure that all work performed on the improvements is performed in a manner which complies with all applicable federal, state, county and local government laws, regulations and rules, including all rules and regulations of City, as these rules and regulations may be modified or changed from time to time.

3.10 Contractor Licenses. All work performed on the improvements shall be done only by contractors licensed in the State of California and qualified to perform the type of work required and comply with the City's Business License Ordinance.

3.11 Acceptance of Work. Upon completion of the improvements to the satisfaction of City, the improvements shall be presented to the City Council for dedication and acceptance and for authorization to file a Notice of Completion. The City Council may accept the Improvements if it determines that the Improvements were constructed in accordance with the approved plans, specifications and contract documents that they operate satisfactorily, and that all other requirements of this agreement have been satisfied. Immediately upon, and as a condition of the expiration of the guarantee period set forth in Section 3.13, Developer shall assign to City all of Developer's rights and remedies, including warranties, as set forth in the approved contract documents, and thereafter City shall have the same recourse under said contract documents that City would have had if City itself had engaged Developer's contractor to construct the Improvements.

3.12 Liability for Work Prior to Formal Acceptance. Until the City Council has formally accepted the Improvements, Developer shall be solely responsible for all damage to the work, regardless of cause, and for all damages or injuries to any person or property at the work site, except damage or injury due to the sole negligence of City, or its employees.

3.13 Guarantee. Developer shall guarantee all work and materials for the Improvements to be free from all defects due to faulty materials or workmanship for a period of one (1) year after the date of formal acceptance of the work by City. A guarantee bond in the amount of 10 percent of the total cost of the improvements as determined by the City and satisfactory to the City in its sole reasonably exercised discretion shall be posted with the City prior to its acceptance of the improvements. Developer shall repair or remove and replace and all such work, together with any other work which may be displaced in so doing, that is found to be defective in workmanship or materials within the one (1) year period, without any expense whatsoever to City. In the event Developer fails to comply with the above-mentioned provisions within thirty (30) days after being notified in writing (or in cases of emergency, immediately) City shall be authorized to proceed to have the defects remedied and made good at the sole cost and expense of Developer, who is hereby contractually bound to pay the costs and charges therefore immediately upon demand. Such action by City will not relieve Developer of the guarantee required by this section. This section shall not, in any way, limit the liability of Developer or any other party for any design or construction defects in the work subsequently discovered by City.

3.14 Record Drawings. Prior to acceptance of the Improvements by the City Council, Developer shall provide City with one mylar copy of record drawings with certification by a licensed engineer in the State of California as to accuracy and completeness. Developer shall be solely responsible and liable for ensuring the completeness and accuracy of the record drawings.

3.15 Ownership of the Improvements. From and after acceptance of the improvements by formal action of the City Council, ownership of the Improvements shall be vested exclusively in City.

3.16 Notice. Any notices required or desired to be sent pursuant to this agreement shall be addressed as follows:

CITY: DEVELOPER:
City Manager Ponderosa Homes II, Inc.
City of Brentwood A California Corporation
150 City Park Way 6671 Owens Drive
Brentwood, CA 94513 Pleasanton, CA 94588-3398

3.17 Termination. In the event that Developer defaults in the performance of any of its obligations under this agreement or materially breaches any of the provisions of this agreement, City shall have the option to terminate this agreement upon written notice to Developer.

3.18 Attorney's Fees. In the event, any action is commenced to enforce or interpret any term or condition of this agreement, in addition to costs and any other relief, the prevailing party shall be entitled to reasonable attorney's fees. Jurisdiction over the authority in any dispute shall be maintained in Contra Costa County.

3.19 Entire Agreement. This agreement contains the entire agreement of the parties hereto with respect to the matters contained herein.

3.20 Assignment. This agreement shall not be assigned without the written consent of
the parties hereto, and any assignment without such written consent shall be void and ineffective. The written notice shall become effective within thirty days upon delivery to the City, provided that the City shall not be responsible for any misdirected written notices under this section.

3.21 Time of Essence. Time is of the essence for this Agreement.

CITY OF BRENTWOOD DEVELOPER: PONDEROSA HOMES II, INC.
A CALIFORNIA CORPORATION

BY: BY:_______________________________

ATTEST:

BY:_____________________________
Karen Diaz, CMC, City Clerk

EXHIBIT "A"
"DEVELOPER'S PROPERTY"
PONDEROSA HOMES II, INC. A CALIFORNIA CORPORATION
SUBDIVISION NO. 8529







City will insert map



































EXHIBIT “B”
REIMBURSABLE IMPROVEMENTS
PONDEROSA HOMES II, INC. A CALIFORNIA CORPORATION
SUBDIVISION NO. 8529




WATER FACILITIES

Prepayment of Fees through CIFP 2004-1

ROADWAY FACILITIES

Partial Prepayment of Fees through CIFP 2004-1
Oversize parkway landscape & irrigation along Sand Creek Road

PARKS and TRAILS FACILITIES

Park Construction
3.97 Acres Park Land Purchase




EXHIBIT “C”
REIMBURSEMENT CALCULATION
BASED ON 2004 DEVELOPMENT FEE PROGRAM
PONDEROSA HOMES II, INC., A CALIFORNIA CORPORATION
SUBDIVISION NO. 8529



WATER FACILITIES
Pre-payment of Fee CIFP 2004-1 56 DU @ $4,076.41/DU $ 228,278.96

TOTAL WATER FACILITIES PREPAID $ 228,278.96

ROADWAY FACILITIES
Partial Pre-payment of Fees CIFP 2004-1 56 DU @ $3,901.43/DU $ 218,480.08

Sand Creek Rd. oversize parkway landscape & irrigation
1,335 LF X 8’ = 10,680 SF @ $3.80/SF $ 40,584.00
Adjustment for Eng, plan check 12.5% $ 5,073.00
Adjustment for financing 10.0% $ 4,058.00
Adjustment for traffic control 2.0% $ 812.00
Total Construction Reimbursable $ 50,527.00

TOTAL ROAD FACILITIES REIMBURSEMENT/PREPAID FEES $ 269,007.08

PARK FACILITIES

Park Construction 3.97 Acres @ $134,679.67/AC $ 534,678.29

Adjustment for Eng, plan check 12.5% $ 66,834.79
Adjustment for Financing 10.0% $ 53,467.83
Subtotal $ 654,980.91

Park land purchased 3.97 AC @$2.78/SF $ 480,754.30
Total reimbursable $1,135,735.21

TOTAL PARK FACILITIES REIMBURSABLE $1,135,735.21


TOTAL PREPAID FACILITY FEES & REIMBURSEMENT $1,633,021.25
 

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