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CITY COUNCIL AGENDA ITEM NO. 8

Meeting Date: January 22, 2008

Subject/Title: Adopt a resolution approving a Memorandum of Understanding between The Brentwood Agricultural Land Trust, Al and Rebecca Courchense and Sarah Coddington, and the City of Brentwood as recommended by the Agricultural Enterprise Subcommittee.

Prepared by: Linda Maurer, Economic Development Manager

Submitted by: Howard Sword, Director of Community Development

RECOMMENDATION
Adopt a resolution approving a Memorandum of Understanding between The Brentwood Agricultural Land Trust, Al and Rebecca Courchense and Sarah Coddington, and the City of Brentwood as recommended by the Agricultural Enterprise Subcommittee.

PREVIOUS ACTION
None.

BACKGROUND
On December 18, 2007, the Agricultural Enterprise Committee (AEC) provided direction to staff to draft a Memorandum of Understanding (MOU) between the Brentwood Agricultural Land Trust (BALT), the property owners of Frog Hollow Farms (Al and Rebecca Courschene and Sarah Coddington), and the City for the purpose of setting forth the terms of a conservation easement acquisition on approximately 93 acres of the Frog Hollow Farms property located in the Agricultural Core.

The AEC has reviewed and recommends the MOU to the City Council for adoption by resolution. The MOU provides the framework for the conservation easement transaction, including the maximum amount of participation by the City at $9,000 an acre to secure the easement, as well as a not to exceed amount on the administrative costs for BALT at $29,250. The MOU also outlines that a portion of BALT’s professional time would be credited against the remaining surplus it holds from the City’s Agricultural Fund, which is approximated at $16,000. The additional funding of approximately $13,250 to complete the easement transaction would come from the City’s Agricultural Administrative Fund 262.

This MOU is consistent with the City Council’s recent adoption of Resolution 2007-213, the Conservation Easement Implementation Guidelines in September 2007. If the parties are able to obtain the terms of the acquisition pursuant to this MOU, staff will bring the complete easement transaction, and any necessary stewardship and administration agreements between BALT and other funding partners, back to the City Council for consideration.

FISCAL IMPACT
The fiscal impact of this Memorandum of Understanding is $29,250. A credit against the remaining surplus of City funds held by BALT of approximately $16,000 will be used towards the administration of this transaction. The remaining funds of approximately $13,250 will come from Agricultural Administrative Fund 262 and has been budgeted in the 2007/08 Operating Budget.

Attachments:
Resolution
Memorandum of Understanding

RESOLUTION NO. 2008-___

A RESOLUTION APPROVING A MEMORANDUM OF UNDERSTANDING BETWEEN THE BRENTWOOD AGRICULTURAL LAND TRUST, AL AND REBECCA COURCHENSE AND SARAH CODDINGTON, AND THE CITY OF BRENTWOOD AS RECOMMENDED BY THE AGRICULTURAL ENTERPRISE SUBCOMMITTEE

WHEREAS, on December 18, 2007, the Agricultural Enterprise Committee (AEC) provided direction to staff to draft a Memorandum of Understanding for the purpose of setting forth the terms of a conservation easement acquisition on approximately 93 acres of the Frog Hollow Farms property located in the Agricultural Core; and

WHEREAS, the proposed MOU provides the framework for the conservation easement transaction, including the maximum amount of participation by the City at $9,000 an acre to secure the easement, as well as a not to exceed amount on the administrative costs for BALT at $29,250; and

WHEREAS, the MOU also outlines that a portion of BALT’s professional time would be credited against the remaining surplus it holds from the City’s Agricultural Fund, which is approximated at $16,000. The additional funding of approximately $13,250 to complete the easement transaction would come from the City’s Agricultural Administrative Fund 262; and

WHEREAS, the MOU is consistent with the City Council’s recent adoption of Resolution 2007-213, the Conservation Easement Implementation Guidelines in September 2007;

WHEREAS, if the parties are able to obtain the terms of the acquisition pursuant to this MOU, staff will bring the complete easement transaction, and any necessary stewardship and administration agreements between BALT and other funding partners, back to the City Council for consideration; and

NOW, THEREFORE BE IT RESOLVED that the City Council of the City of Brentwood hereby approves and authorizes the City Manager to execute the attached Memorandum of Understanding between the Brentwood Agricultural Land Trust, Al and Rebecca Courchense and Sarah Coddington, and the City of Brentwood for the purpose of setting forth the terms of a conservation easement acquisition on approximately 93 acres of property in the Agricultural Core.

PASSED, APPROVED AND ADOPTED by the City Council of the City of Brentwood at a regular meeting held on the 22nd day of January 2008 by the following vote:

MEMORANDUM OF UNDERSTANDING BETWEEN
THE BRENTWOOD AGRICULTURAL LAND TRUST,
AL AND REBECCA COURCHENSE AND SARAH CODDINGTON,
AND THE CITY OF BRENTWOOD
(FROG HOLLOW FARMS CONSERVATION EASEMENT)

This Memorandum of Understanding (“MOU”) is entered this ____ day of _________, 2008, the date of last execution hereof (“Effective Date”), by and between the Brentwood Agricultural Land Trust (“BALT”), Al and Rebecca Courchesne and Sarah Coddington (collectively, the “Property Owner”) and the City of Brentwood, a municipal corporation of the State of California (“City”) (each a “Party” and collectively, the “Parties”).

RECITALS

A. In 2001, the City Council adopted Ordinance 683, establishing the City’s Agricultural Land Conservation program (the “Program”).

B. The main purposes of the Program include acquiring conservation easements and preserving agricultural lands within the City of Brentwood’s Planning Area and within the County’s Agricultural Core.

C. The City Council established the formation of the Agricultural Enterprise Committee (AEC), comprised of two members of the City Council, to make recommendations to the full City Council on issues relating to the implementation of the current ordinance.

D. In 2007, the City Council adopted Resolution 2007-213 establishing a set of implementation guidelines for the conservation easement program, including the following requirement for layered funding sources: “If it is determined that there is more than one funding source available to acquire an easement, the Committee will require a memorandum of understanding between all entities (land trust, City, and State or Federal agency) involved in the transaction, outlining the details of the funding agreement, including but not who holds the easement, as well as the administration/stewardship of the property.”

E. BALT has been in discussions with the AEC regarding a conservation easement opportunity for four parcels of prime agricultural land totaling approximately 93 acres owned by the Property Owner and described in an appraisal (the “Appraisal”) prepared by Hulberg & Associates, dated May 4, 2007 (the “Easement Area”). BALT has also identified two other funding sources for the easement, the State Department of Conservation Farmland Conservancy Program and the Coastal Conservancy.

F. On December 18, 2007, the AEC provided direction to City staff to negotiate a Memorandum of Understanding with BALT and the Property Owner and to formalize the amount of administrative cost paid to BALT for completing the transaction, as well as all of the necessary deal points to ensure a successful outcome for the City. Another MOU or form of agreement will be required to include any other funding agencies if and when they participate.

G. The Parties desire to memorialize their relationship and to set forth their respective roles and obligations in completing this easement transaction in this MOU.

NOW, THEREFORE, IT IS HEREBY AGREED by the Parties as follows:

1. Purpose of Agreement. The purpose of this MOU is to set forth the understanding between the City, BALT and the Property Owner regarding the proposed agricultural conservation easement and to provide a framework for the City, BALT and the Property Owner to move forward with the conservation easement process.

2. Good Faith Negotiations. The Parties agree to work in good faith to negotiate and complete the proposed conservation easement transaction pursuant to terms and conditions set forth herein. Attached as Exhibit A is a proposed timeline for the negotiation and purchase of the easement. However, the Parties acknowledge that the schedule is tentative and that there can be no guarantee that the transaction will be completed as scheduled.

3. Stewardship of the Easement. The City and the Property Owner agree to work solely with BALT as the land trust that would hold and administer the proposed conservation easement as established by the City’s conservation easement implementation guidelines. In the event the conservation easement is successfully negotiated, BALT and the City will enter into an agreement regarding the stewardship of the easement whereby BALT would assume the legal responsibility to monitor and enforce the terms of the conservation easement in perpetuity.

4. Terms of Conservation Easement. The Parties agree to negotiate the easement and complete the transaction based on the following terms and conditions:

a. The proposed easement will be recorded against the Easement Area;

b. At least ninety (90) percent of the Easement Area will remain in agricultural production;

c. The building envelope on the forty-acre parcel will be limited to 3,000 square feet for a residence, the residence will be built at a specific location on the corner of the parcel, and no second units may be constructed;

d. The size of any residences on the smaller parcels will be limited to 1,500 square feet, the homes will be built in the corners of the parcels, and no second units may be constructed; provided however, that one of the smaller parcels may also include farmworker housing not to exceed 1.5 acres ;

e. The agricultural enterprise envelope, currently consisting of a commercial kitchen and office, on Assessor’s Parcel Number 011-120-014 will be limited to two acres;

f. All existing liens or encumbrances will be removed or will be required to subordinate to the terms of the conservation easement; and

g. In accordance with the Standards and Practices of the Land Trust Alliance, a portion of the easement purchase price will be deposited into BALT’s Easement Stewardship Fund.

5. Easement Purchase Price. The Parties agree that the valuation of the conservation easement will be based on the Appraisal. The Parties acknowledge that BALT and the Property Owner shared equally in the cost of the appraisal. The AEC has recommended City participation in this easement transaction in an amount not to exceed $9,000 an acre. In addition, BALT agrees to seek additional funding for the easement purchase price from governmental agencies and private organizations that provide such funding, such as the State Department of Conservation Farmland Conservancy Program and the Coastal Conservancy. The Parties agree that they will work together to obtain additional funding and enter into an amendment or new MOU to add all funding parties if additional funding is obtained.

6. Notification of Neighboring Property Owners. The Property Owner has consented to BALT sending a written notification to the Property Owner’s neighbors of the proposed conservation easement.

7. Payment of Transaction Costs. The Parties acknowledge that they will incur certain expenses as the transaction moves forward. Each Party will bear its own costs, except as set forth herein and in section 8 below. The City agrees to reimburse BALT for its staff and consultant costs in an amount not to exceed $29,250 (the “Transaction Cost”), as set forth in Exhibit A. BALT will submit requests for reimbursement on a monthly basis after completion of the milestones set forth in Exhibit A. Reimbursements will first be applied from the remaining surplus City funds, which amount to $16,000, which BALT holds from the 2006/07 fiscal year (the “Surplus”). If and when BALT’s costs exceed the Surplus, the City will reimburse BALT by check within 30 days of receiving a monthly invoice for staff time and consultant costs incurred during the previous month. BALT agrees to maintain complete and accurate records with respect to costs incurred under this MOU and to provide such records to City upon request.

8. Term. This MOU will commence on the Effective Date and, unless terminated earlier pursuant to this MOU, will terminate June 30, 2008. The termination date can be extended twice for up to three months each time by written agreement of the Parties. The City Manager is authorized to execute such extensions with the authorization from the standing Agricultural Enterprise Committee. Any Party may terminate this MOU, prior to June 30, 2008, the end of the City’s fiscal year, by delivery of written notice of election to terminate to the other Parties. In the event that the Property Owner chooses to terminate this Agreement after BALT and the City have obtained funding for the conservation easement in the amount of the value established in the Appraisal, the Property Owner will be responsible for reimbursing (i) the City’s Agricultural Administration Fund for the Transaction Costs paid or reimbursed by the City during the term of this Agreement and prior to the Property Owner’s termination of this Agreement, including any Surplus funds reimbursed to BALT pursuant to section 7 above, and (ii) BALT for any costs incurred by BALT during the term of this Agreement that have not been reimbursed by the City.

9. Relationship of the Parties. It is understood that this is an MOU by and between independent parties and is not intended to, and will not be construed to, create the relationship of agent, servant, employee, partnership, joint venture or association, or any other relationship whatsoever other than that of independent parties.

10. Entire Agreement. This MOU and its Exhibit A set forth and contain the entire understanding and agreement of the Parties, and all oral or written representations, understandings or agreements are expressly stated in this MOU. No testimony or evidence of any such representations, understandings, or covenants will be admissible in any proceeding of any kind or nature to interpret or determine the terms or conditions of this MOU.

11. Amendments. Changes to the terms and conditions of this MOU will be made only by written amendment signed by the Parties.

12. Notices. All notices with respect to this MOU will be given by first class mail to the Parties as follows:

City: City Manager
City of Brentwood
150 City Park Way
Brentwood, CA 94513

BALT: Executive Director
Kathryn Lyddan
1120 Second Street, #108
Brentwood, CA 94513

Property Owner: Al and Rebecca Courchense
Sarah Coddington
11435 Byron Highway
Brentwood, CA 94513

Or to such other persons, addresses or telephone numbers as the Parties may designate in writing from time to time.

13. Assignment. No Party may assign any right or obligation pursuant to this MOU without the written consent of the other Parties. Any attempted or purported assignment without the written consent of the other Parties will be void and of no effect.

14. Jurisdiction and Venue. Any action at law or in equity brought under this MOU for the purpose of enforcing a right or rights provided for by this MOU will be tried in a court of competent jurisdiction in the County of Contra Costa, State of California, and the Parties waive all provisions of law providing for a change of venue in these proceedings to any other county.

15. Paragraph Headings. Paragraph headings as used herein are for convenience only and will not be deemed to be a part of such paragraphs and will not be construed to change the meaning thereof.

16. Waiver. Waiver by any Party of any default, breach or condition precedent will not be construed as a waiver of any other default, breach or condition precedent or of any other right under this MOU.

17. Severability. If any term, provision, covenant, or condition of this MOU is ruled invalid, void, or unenforceable by a court of competent jurisdiction, this MOU will nonetheless remain in full force and effect as to all remaining terms, provisions, covenants, and conditions.

18. Authority. The individuals executing this MOU represent and warrant that they have the right, power, legal capacity and authority to enter into and to execute this MOU on behalf of the respective legal entities of the Parties.

Brentwood Agricultural Land Trust:

By:

Printed Name:

Date:
City of Brentwood:

By:
Donna Landeros, City Manager

Date:

ATTEST:

By:
Margaret Wimberly, City Clerk

APPROVED AS TO FORM:

By:
Damien B. Brower, City Attorney

Property Owner:

By:
Al Courchesne

By:
Rebecca Courchesne

By:
Sarah Coddington

EXHIBIT “A”

CONSERVATION EASEMENT ON FROG HOLLOW FARMS
Tentative Timeline for Conservation Easement Transaction
January 2008

Completed BALT and property owner enter into a letter of intent.

BALT staff sends property owner and the appraiser a draft of the conservation easement for the property.

BALT staff opens an escrow with the title company and obtains a preliminary title report.

Appraisal of the conservation easement is completed.

Property owner notifies any lenders and lien holders about possible conservation easement on the property and requests the subordination of loans and liens to the conservation easement.

BALT staff and property owner shows the property to Chuck Tyson of the State Department of Conservation and requests matching funds.
BALT staff presents conservation easement transaction to the Coastal Conservancy and requests matching funds.

January 15 City Agricultural Enterprise Committee considers Memorandum of Understanding between BALT, the property owner and the City.

January 22 City Council considers Memorandum of Understanding between BALT, the property owner and the City and adopts resolution required by the State Department of Conservation.

January 28 Coastal Conservancy staff visits the property.

February County Board of Supervisors adopts resolution required by the State Department of Conservation

BALT staff sends notice of transaction required by the State Department of Conservation to neighboring property owners.

Final draft of easements are completed and distributed to parties for comment.

Application to Coastal Conservancy is submitted.

March Application to State Department of Conservation submitted.

BALT staff retains consultant to prepare Baseline Report.

BALT Board approves final calculation of stewardship deposit.

Property owner obtains subordination agreements for any liens on the property

BALT attorney drafts escrow instructions.

April Coastal Conservancy Board of Directors considers funding (third week in April).

State Department of Conservation considers funding.

BALT Board approves the final conservation easements, baseline documentation, stewardship deposit and related documents.

May Brentwood City Council approves funding of the conservation easement and funds are deposited into the escrow account.

Matching funding from State Department of Conservation and the Coastal Conservancy are deposited into the escrow account.

BALT and property owner sign the conservation easement and it is deposited into escrow account.

Conservation easement and subordination agreement(s) recorded, stewardship deposit is deposited in BALT’s Stewardship Fund, title insurance is issued and property owner receives payment of the purchase price for the conservation easement.

Estimate of staff time and consultant costs on the Courchesne easement.

BALT is applying to both the California Farmland Conservancy Program and The Coastal Conservancy for matching funds for the Frog Hollow easement. We anticipate that the Frog Hollow easement will be completed by the end of May 2008. We estimate that the following expenditures will be made between July 1, 2007 and the closing date:

• 120 hours of BALT professional staff time @$125 an hour ($15,000). Between July 1 and November 5, BALT professional staff spent 14 hours.
• 30 hours of legal time by Harry Pollack at Conservation Partners @ $225 an hour ($6,750)
• Baseline report by Shelton Douthit ($7,500)

The estimated cost of closing the Frog Hollow Farm transaction is $29,250

 
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Brentwood, CA 94513
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