HomeMy WebLinkAbout1999-05-04; City Council; 15170; Reimbursement Preliminary Costs Habitat MitigationDEPT. CM
RANCH0 SANTA I?E ROAD - RJZIMBURSEMENT
FOR PRELIMINARY COSTS AND COST OF HABITAT MITIGATION
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RECOMMENDED ACTION:
Adopt Resolution No 9 9 - 155 authorizing the release and payment of funds to Real Estate
Collateral Management Company for preliminary engineering and design work and habitat mitigation
costs for Ranch0 Santa Fe Road, and appropriating funds.
ITEM EXPLANATION:
On December 10, 1996 the City Council adopted Resolution no 96-425 authorizing the Mayor to
execute an agreement with Bank of America’s Real Estate Collateral Management Company
(RECM) which provided a critical portion of the funding for the construction of Ranch0 Santa Fe
Road. RECM, the current owner of the Villages of La Costa project, entered into this agreement (and
several others addressing parks, fire stations, right-of-way acquisition, and affordable housing) as part
of the final map approval for the Arroyo La Costa project (CT 88-03).
This 1996 agreement was a key component in the total financing program for Ranch0 Santa Fe Road.
The financing plan began to take shape in the late 1980s and early 1990s as the City and Fieldstone
(and later Bank of America) began to reach an agreement on the creation of a Community Facilities
District (CFD) which would ultimately fund the road improvements. The financing plan was based
on one basic tenant: The City required that the funding for Ranch0 Santa Fe Road was to be
“guaranteed” by the property owners. In this case the word “guarantee” meant that the funding
program had to provide the Council with the ability to move forward with the road construction when
it was needed, irrespective of the state of development in the area.
In 1993 the City Council adopted an interim financing plan that allowed small developers in the area
to enter into agreements with the City to prepay their estimated CFD #2 taxes based on an projected
cost per unit. The concept was that a small amount of development could be allowed in the Zone 11
and Zone 12 area of the City without severely impacting the traffic on Ranch0 Santa Fe Road. If the
City Engineer could certify that the expected traffic generation from a new project would not have a
significant impact on the level of service in the area, the Council allowed developers to proceed with
development if they paid their fair share of the road costs through the prepayment of the CFD #2
taxes.
The 1996 agreement with RECM formed the fhral financing plan for the road based on the following
concepts:
1. The property owners (including Bank of America (RECM) would continue to work with the City
on the creation of CFD #2 to secure the ultimate financing of the road.
2. In the interim, developers would be allowed to prepay their estimated obligation (as determined
by the City Engineer) based on the CFD #2 tax computations developed in the early 1990s.
3. Bank of America (RECM) would provide the City with a bond that tilled the funding gap between
the amount of money available from CFD #2 prepayment collections and the total estimated cost
of the road.
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PAGE 2 OF AGEND:B,LL NO. 15,170
Since the approval of these plans five developers have entered into prepayment agreements with the
City to prepay CFD #2 taxes, resulting in approximately $19.7 in payments and interest for the
Ranch0 Santa Fe Road construction fund..
The 1996 agreement also anticipated that RECM would eventually receive reimbursement for two
categories of costs incurred as part of the Villages of La Costa and Ranch0 Santa Fe Road
development. Section 4.1 of the agreement stated that the future road improvement budget included
money to be used to reimburse RECM for costs related to the preliminary engineering and design of
, Ranch0 Santa Fe Road. Also, section 4.1 and 6.4 of the agreement anticipated that the creation of the
Habitat Conservation Plan (HCP) would benefit Ranch0 Santa Fe Road by providing for 1) the
wildlife agency permitting, and 2) the habitat mitigation for the road.
The agreement specifically delayed any reimbursement of these costs until some time in the future
when the parties had come to an agreement on the amount due to RECM under each section, and the
City Engineer could certify that sufficient funds were available to pay the required amounts to RECM
and assure that the road funding was not jeopardized.
In late March of this year, City and RECM reached an agreement on both the preliminary engineering
and design costs ($863,327), and the habitat mitigation needs ($2,391,000). The City Engineer
determined that total amount of funds currently available, $19.7 million (plus those funds that may be
received in the future), are adequate to support the construction of the road project, and to allow the
reimbursement and payment to RECM of $3,254,327, the total amount due for all obligations under
the agreement.
The total amount due for preliminary engineering and design costs (section 4.1(i)) is shown on the
attached report from Galen Peterson, the City’s consulting engineer. Mr. Peterson worked with both
RECM and the City staff to determine the portion of the preliminary costs eligible for reimbursement.
The total amount due for habitat mitigation costs for the road (section 4.l(ii) and section 6.4) was
determined using the formula included in section 6.4 which sets the mitigation ratio at 2.5: 1, and sets
the price for mitigation land at $15,000 per acre. The City’s Ranch0 Santa Fe Road consulting
engineer, Doug Helming, worked with the City’s environmental consultants, Dudek & Associates, to
determine the total habitat impact of the road - 63.76 acres. (63.76 x 2.5 x $15,000 = $2,391,000).
Based on the above information, staff is recommending that the Council authorize the payment of the
above reimbursements to RECM as allowed under the Ranch0 Santa Fe Road Agreement.
ENVIRONMENTAL:
The environmental issues associated with the financing and construction of Ranch0 Santa Fe Road
have previously been analyzed in the certified EIR 9 l-01. The recommended reimbursement is one
of the actions contemplated by EIR 91-01 and raises no new environmental issues. Therefore, EIR
91-01 satisfies all requirements of the California Environmental Quality Act for the recommended
action.
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PAGE 3 OF AGENDi. NO. 15,175)
FISCAL, IMPACT:
During the past few years the City has continued to work with RECM on the formation of a
Community Facilities District (CFD) to fund the construction of Ranch0 Santa Fe Road. Until the
CFD is finally formed, developers in the Ranch0 Santa Fe Road area have chosen to enter into
agreements with the City to prepay their obligation under the future CFD. These payments total
about $19.7 million as of the end of March 1999. The City Engineer is satisfied that there are
adequate funds to provide for the reimbursement of $3.2 million to RECM, and to provide funding
for the future phases of Ranch0 Santa Fe Road construction.
EXHIBITS:
1. Resolution No 39 - I 55 authorizing the release and payment of funds to Real Estate
Collateral Management Company for preliminary engineering and design work and habitat
mitigation costs for Ranch0 Santa Fe Road, appropriating funds and Amendment No. 1 to the
1996 Ranch0 Santa Fe Road Agreement.
2. Report ti-om Galen Peterson - Consulting Engineer, dated April 2, 1999.
3. Report from Doug Helming regarding Areas of Impact, dated March 10,1999.
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RESOLUTION NO. 99-155
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CARLSBAD, CALIFORNIA, AUTHORIZING THE RELEASE
AND PAYMENT OF FUNDS TO REAL ESTATE
COLLATERAL MANAGEMENT COMPANY FOR
PRELIMINARY ENGINEERING AND DESIGN WORK AND
HABITAT MITIGATION COSTS FOR RANCHO SANTA FE
ROAD APPROPRIATING FUNDS, AND AUTHORIZING
MAYOR TO EXECUTE AMENDMENT NO. I TO THE 1996
RANCHO SANTA FE ROAD AGREEMENT.
WHEREAS, on February 3, 1997 the City of Carlsbad City) and Real Estate
Collateral Management Company (RECM) entered into an agreement titled “1996
Rancho Santa Fe Road Agreement” (Agreement), and
WHEREAS, the Agreement addresses the obligations of both the City and
RECM related to the financing and construction of future phases of Rancho Santa F
Road, and
WHEREAS, section 4.1 of the Agreement provides that RECM is eligible for
reimbursement for expenses related to the preliminary engineering and design cost!
Rancho Santa Fe Road up to $4.0 million, and for future road habitat and mitigation
costs up to $5.75 million, and
WHEREAS, such reimbursement would not occur until I) the City and RECW
had reached an agreement on the amounts due to RECM under each category of
expenses, and 2) the road had been constructed, or the City Engineer is satisfied th
adequate funds are available for the completion of all road work, and
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WHEREAS, following a review of all costs by the City Engineer, the City and
RECM have reached an agreement that the amount due to RECM for preliminary
engineering and design costs is $863,327, and
WHEREAS, following a review of mitigation requirements by the City staff, th
City and RECM have reached an agreement that the amount due to RECM for road
related habitat mitigation costs is $2,391,000, based on the formula shown in sectio
6.4 of the Agreement, and
WHEREAS, the City Engineer has determined that funds remaining after the
reimbursement of the above expenses will be adequate to finance the remaining
phases of Rancho Santa Fe Road
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY Of
CARLSBAD, CALIFORNIA, as follows:
1. That the above recitations are true and correct.
2. That the City Engineer and Finance Director are hereby authorized to release tht
amount of $863,327 representing the amount due to RECM in full satisfaction of
requirements of section 4.1 (i) of the Agreement.
3. That the City Engineer and Finance Director are hereby authorized to release thc
amount of $2,391,000 representing the amount due to RECM in full satisfaction c
the requirements of section 4.1 (ii), and 6.4 of the Agreement.
4. That the above payments shall be made from Rancho Santa Fe Road prepayme
received from developers subject to inclusion in Community Facilities District #2
(CFD #2), and that these expenses are directly related to the project, and are ' subject to reimbursement from any future bond issue that may result from the
formation of CFD #2.
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5. That the Finance Director is hereby authorized to appropriate the amount of
$3,254,327 from Rancho Santa Fe Road Prepayment funds for the above payr,
to RECM.
6. That the Mayor is hereby authorized to execute Amendment No. 1 to the 1996
Rancho Santa Fe Road Agreement.
PASSED AND ADOPTED THIS 4 th DAY OF May , 1E
BY THE FOLLOWING VOTE TO WIT:
AYES: Council Members Hall, Nygaard, Finnila & Kulchin
NOES: None
ABSENT: Council Member Lewis
ABSTAl N: None
ATTEST:
/
CLAUDE A. LEWIS, MAYOR
MATT HALL, Mayor Pro Tern
NZ, CITY CLERK KAREN R. KUNDTZ, Assistant City Clerk
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4 EXHIBIT 2
GAIEN N. PETERSON
CONSULTING ENGINEER
April 2, 1999
James F. Elliott
Administrative Services Director
CITY OF CARLSBAD
1200 Carlsbad Village Drive
Carlsbad, CA 92008-1 989
Subject: ANALYSIS OF REIMBURSEMENT TO VILLAGES OF LA COSTA FOR
RANCHO SANTA FE ROAD AND OLIVENHAIN ROAD IMPROVEMENTS
Dear Jim,
We have had several meetings, which also included Fred Arbuckle and Tim O’Grady
from Morrow Development. I have reviewed the costs that were submitted on October
18, 1996 by Villages of La Costa (VLC) for reimbursement of Rancho Santa Fe Road
and Olivenhain Road improvements. In addition I have talked to Dokken Engineering,
Dudek & Associates and City staff personnel.
Based on these meetings and other discussions, I have enclosed herewith a summary
sheet showing, in my opinion, the costs eligible for reimbursement which total $863:327.
The enclosed summary sheet shows the amount broken down as follows
(1) Currently eligible costs, which total $766,573.
(2) Currently eligible Habitat Conservation Plan (HCP) costs of $96,754.
(3) Total Eligible Costs for reimbursement of $863,327.
The enclosed table also shows the amount of the initial submittal of costs by VLC on
October 18, 1996. This initial submittal was in the total amount of $7,226,250. In the
last column of the enclosed table, I have provided comments and given reasons why the
City has not approved the initial submittal costs.
If you have any questions concerning this matter please contact me.
Sincerely,
\ / Galen N. Peterson, P.E. Principal
Enclosure
Cc: Lloyd Hubbs
Marty Orenyak
16064 SUN SUMMIT Pr., SAN DIEGO, CA 92127-2050 (619) 487-7000 FAX (619) 487-7047
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EXHIBIT 3
Coastal Sage Other Habitat Total Habitat impacts to Exist Total Impacts
Scrub impacts Roads’
39.49 ac. 24.27 ac. 63.76 ac. 11.68 ac. 75.44 ac. -
City of Carlsbad Memo Public Works - Engineering
DATE: March IO, 1999
TO
FROM:
SUBJECT AREA OF IMPACTS; RANCHO SANTA FE ROAD NORTH,
PROJECT NO. 3190
JIM ELLIOTT, ADMINISTRATIVE SERVICES DIRECTOR
As you requested at the meeting on Monday, March 8,1999, I requested Dudek & Associates to prepare
an estimate of the impacts to the Bank of America property caused by a mad only project. Dudek was
instructed to calculated the impacts broken into three categories as follows:
1. Coastal Sage Scrub
2. Other habitat areas
3. Existingroads
The results of the estimate are presented below:
RANCHO SANTA FE ROAD, PROJECT NO. 3190
IMPACTS FROM ROAD ONLY PROJECT
An exhibit to illustrate the above area determinations is being prepared. I will forward the exhibit to you
when it is finished.
If you have additional questions please call me at (760) 431-5999.
C: Fred Arbuckle, Villages of La Costa
Galen Peterson
Don Rideout, Planning Department
2075 las Palmas Drive + Carisbad, CA 92009 + (760) 438-1 161 Fax (760) 431-5769
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