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HomeMy WebLinkAbout2009-03-10; City Council; 19736; Reporting settlement agreement with EncinitasCITY OF CARLSBAD - AGENDA BILL AB# 19,736 MTG. 03/10/09 DEPT.CA REPORTING OUT THE SETTLEMENT AGREEMENT BETWEEN THE CITY OF ENCINITAS AND CITY OF CARLSBAD DEPT. HEAD CITY ATTY. CITY MGR. k/ RECOMMENDED ACTION: There is no action to be taken by the City Council. ITEM EXPLANATION: The parties have now settled this issue under the authority given to the City Attorney by the City Council at its closed sessions of October 14, 2008. This item satisfies the Brown Act requirement to report the fact of a settlement approved in a prior closed session and makes the terms and conditions of the settlement available to the public. FISCAL IMPACT: Costs of the settlement will be borne by future Development Impact Fees. ENVIRONMENTAL IMPACT: Reporting out the fact of Settlement is not a "project" within the meaning of CEQA and therefore environmental review is not required pursuant to CEQA Regulation 15061(b)(3). EXHIBIT 1.Settlement Agreement on file with the City Clerk. DEPARTMENT CONTACT: Ron Ball 760-434-2801 FOR CITY CLERKS USE ONLY. COUNCIL ACTION: APPROVED DENIED CONTINUED WITHDRAWN AMENDED D D nnn CONTINUED TO DATE SPECIFIC CONTINUED TO DATE UNKNOWN RETURNED TO STAFF OTHER -SEE MINUTES Council received tbe report. D Dnn February 25, 2009 TO: CITY CLERK FROM: CITY ATTORNEY RE: SETTLEMENT AGREEMENT BETWEEN ENCINITAS AND CARLSBAD Attached please find the above Agreement. I respectfully request that you present this Agreement to the Mayor for execution and return it to my office. I will send the original signed Agreement to you to keep on file as soon as we receive it. I appreciate your prompt attention in this matter. RONALD R. BALL City Attorney rn/enclosure SETTLEMENT AGREEMENT THIS SETTLEMENT AGREEMENT (the "Agreement") is made and entered into as of December 1, 2008 (the "Execution Date") by and between the CITY OF ENCINITAS, a municipal corporation ("Encinitas") and the CITY OF CARLSBAD, a municipal corporation ("Carlsbad") (Encinitas and Carlsbad are sometimes hereinafter referred to individually as a "city" and collectively as the "cities"). This Agreement shall become effective upon its approval by the San Diego County Superior Court in accordance with Section Three below. The Agreement is entered into with respect to the facts set forth in the following recitals: RECITALS A. On December 4, 2007, the Carlsbad City Council adopted its Resolution No. 2007-303, certifying Final EIR 05-05 (the "Ponto EIR"), and approving General Plan Amendment 05-04, Local Coastal Plan Amendment 05-01 and "Discussion Item 05-01," for a land use project in the southwestern portion of Carlsbad known as the "Ponto Vision Plan" ("Ponto Plan"). B. The Ponto EIR concluded that two intersections within the boundaries of Encinitas, i.e., the La Costa Avenue/Vulcan Avenue intersection, and the La Costa Avenue/Coast Highway 101 intersection (collectively, the "Subject Intersections") would be impacted by development under the Ponto Plan. The Ponto EIR concluded that the appropriate mitigation of these impacts to the Subject Intersections should be the imposition of a "fair share" obligation of developers within the Ponto Plan area to fund 27% of the cost of certain intersection and roadway improvements located on and along La Costa Avenue, including the improvements to the La Costa Avenue/Vulcan Avenue intersection, the La Costa Avenue/Railroad Bridge crossing, the La Costa Avenue/Coast Highway 101 intersection and associated street widening, as more specifically described in Appendix G-2 to the Ponto EIR (collectively, the "Intersection Improvements"). In certifying the EIR and approving the Ponto Plan, the Carlsbad City Council found that the impacts to the Subject Intersections would be mitigated to a level of less than significant by adopting the Ponto EIR's proposed 27% funding of the Intersection Improvements. C. Encinitas submitted comments on the draft Ponto EIR and objected to Carlsbad's imposition of a requirement to fund 27% of the Intersection Improvements as inadequate mitigation of the Ponto Plan's impacts to the Subject Intersections. Following the Carlsbad City Council's certification of the Ponto EIR and the approval of the Ponto Plan, Encinitas filed and served its Petition for Writ of Mandate and Complaint for Declaratory Relief in City of Encinitas v. City of Carlsbad, et al, San Diego County Superior Court (North County Division) Case No. 37-2008-00088091-CU-PT-NC (the "Lawsuit"). D. The cities have agreed generally that (a) eventually the Intersection Improvements will have to be constructed; (b) the anticipated cost will be in the $7.3 million range (in 2008 dollars); and (c) the Ponto Plan, when developed, will have an impact on the average daily trips at the Subject Intersections, requiring Carlsbad to contribute its "fair-share" to the Intersection Improvements. Encinitas and Carlsbad have participated in mediation and engaged in post- 2287/026132-0002 949697.01 a02/24/09 mediation settlement negotiations, and have mutually agreed to settle the Lawsuit and resolve their dispute regarding the appropriate fair share contribution of the Ponto Plan to mitigate its impacts to the Subject Intersections. This Agreement documents that settlement and resolution. AGREEMENT NOW, THEREFORE, in consideration of the foregoing Recitals, which are incorporated herein by this reference and are a substantive part of this Agreement, and the covenants, representations, warranties, and promises contained herein, Encinitas and Carlsbad agree as follows: Section One: Fair Share Funding, Design and Construction of the Intersection Improvements 1.1 Encinitas and Carlsbad agree that Carlsbad's fair share of the costs of the Intersection Improvements is 50%, and Encinitas' fair-share is the remaining 50% of such costs. Encinitas shall provide its 50% share of the cost of the Intersection Improvements from fees imposed on landowners/developers/applicants in its jurisdiction, or from such other funding sources as Encinitas may use, in its discretion. Carlsbad shall provide its 50% share of the cost of the Intersection Improvements solely from fees imposed on landowners/developers/applicants within the Ponto Plan area. Encinitas and Carlsbad further acknowledge that: (a) each city shall be responsible for funding its 50% share of the Intersection Improvements; and (b) neither city is required to cover the funding shortfall, if any, of the other. 1.2. Encinitas shall act as the lead agency with respect to the planning, design, environmental review, permitting, preconstruction, and construction of the Intersection Improvements. As lead agency, Encinitas shall be solely responsible for all legal fees and costs incurred in defending any legal challenges to the design or construction of the Intersection Improvements, including, but not limited to, CEQA challenges. 1.3. Encinitas agrees that the Intersection Improvements will actually be designed and constructed, consistent with the "Conceptual La Costa Avenue Improvement Plan" developed by Carlsbad staff (as set forth in the Ponto EIR, Appendix G-2, and hereinafter referred to as the "Conceptual Improvement Plan"), and at the approximate estimated cost of $7,352,505 (in 2008 dollars) (the "Intersection Improvements Cost"). 1.3.1 The Intersection Improvements Cost is based on information as of the date of approval of the Ponto Plan, and shall be adjusted to reflect any changes in estimated "soft" (e.g., engineering, design, permitting, environmental, preconstruction, etc.) and "hard" (e.g., construction, right-of-way acquisition, etc.) costs. 1.3.2 Modifications to the Conceptual Improvement Plan will be allowed if: (a) they are needed to address requirements from other districts or agencies; or (b) the parties mutually agree that the modifications provide substantially the same (or greater) mitigation of the impacts at lower improvement design, right-of-way acquisition, or construction costs. 2287/026132-0002 949697.01 a02/24/09 1.3.3 The absolute amount of the cities' fair-share contributions (but not the proportions) shall be adjusted upward or downward to reflect any changes in the estimated soft or hard costs for the Intersection Improvements. 1.4. The cities shall prepare a mutually acceptable schedule, to be implemented based upon available funding, depicting the tasks and timeframes associated with the design and construction of the Intersection Improvements. The cities further agree to cooperate in completing said schedule on or before June 30, 2009. Design and construction work on the Intersection Improvements shall be triggered when either of the two Subject Intersections reaches Level of Service E, subject to the availability of funding. The cities shall use their best efforts to raise the funds necessary to complete the Intersection Improvements within twenty (20) years from the Effective Date of this Agreement. 1.5. The Carlsbad City Engineer shall collect Carlsbad's allocated 50% share of the Intersection Improvements Cost solely from the Ponto Plan landowners/ developers/applicants prior to issuance of a building permit for any development project within the Ponto Plan boundary. 1.5.1 Carlsbad will retain the Ponto landowner/developers' allocated pro-rata fair-share payments until Encinitas is required to collect said contributions. 1.5.2 Encinitas will collect such Carlsbad share when Encinitas also has raised all or a portion of its 50% share of the Intersection Improvements Cost, such that some or all of the funds are available to commence one or more components of the "soft" and "hard" cost work (as defined in Paragraph 1.3.1 above) in connection with the Intersection Improvements. 1.6. Encinitas, through its contractors, shall commence the construction phase of the Intersection Improvements after the issuance of all required permits, consistent with the schedule agreed upon between the two cities in accordance with Paragraph 1.4 above. 1.7. The cities shall cooperate in seeking third-party funding for the cost of the Intersection Improvements. If the Intersection Improvements receive third-party funding from any source, the proceeds shall be applied to the Intersection Improvements and each city shall be given a 50% credit, based on such third party funding, toward each city's share of the Intersection Improvements Cost. Section Two: Dismissal of Lawsuit, Release of Claims and Covenant Not to Sue or Oppose Ponto Plan Developments 2.1 Within ten (10) days following the Effective Date (as defined in Paragraph 3.1 below), Encinitas shall file with the San Diego County Superior Court a signed Request for Dismissal with Prejudice of the entirety of the Lawsuit, and shall provide Carlsbad a conformed copy of the filed Request for Dismissal. 2.2 Encinitas, on behalf of itself and its officers, officials, employees, successors and assigns, past, present and future, hereby fully and forever waives, releases, discharges and covenants not to sue Carlsbad and each of its officers, officials, employees, successors and 2287/026132-0002 949697.01 a02/24/09 assigns, with respect to any and all claims, demands, costs, expenses, damages, judgments, orders and liabilities of whatever kind or nature, in law, equity or otherwise, including but not limited to claims for attorneys' fees and/or costs, whether now known or unknown, vested or contingent, suspected or unsuspected, and whether or not concealed or hidden, that have existed, may have existed or do exist relating to, or that were or could have been included in the Lawsuit relating to the Ponto Plan or Ponto EIR, or which relate in any way to Carlsbad's certification of the Ponto EIR and approval of the Ponto Plan (collectively, the "Released Claims"). 2.3 It is the intention of the cities that Encinitas' waiver, release and covenant not to sue with respect to the Released Claims shall be effective as a bar to each and every Released Claim, known or unknown, suspected or unsuspected; and Encinitas hereby knowingly and voluntarily waives any and all rights and benefits otherwise conferred by the provisions of Section 1542 of the California Civil Code, which reads in full as follows: "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR." Encinitas expressly acknowledges that, notwithstanding Section 1542 of the California Civil Code, or any other statute or rule of law of similar import, this release shall be given full force and effect according to each and all of its express terms and provisions. Encinitas acknowledges and understands that it is possible that it may discover other or further claims or facts than the ones it presently believes to exist concerning this Agreement, the Lawsuit or the Released Claims. Encinitas expressly accepts and assumes the risk of any such other or further claims or facts, and agrees that this Agreement, and the dismissals, releases, waivers and other provisions hereof, and any other documentation to be delivered in connection herewith, shall remain effective notwithstanding the discovery of any such other or further claims or facts. 2.4 Encinitas, for itself, its officials, agencies, and employees, agrees not to challenge or oppose: (a) The Ponto Plan in the form set forth in Carlsbad City Council Resolution No. 2007-303, adopted on December 4, 2007, including any modifications thereto as may be required by the California Coastal Commission and acceptable to the Carlsbad City Council; (b) Any project within the Ponto Plan; and (c) Any application by Carlsbad or landowners/developers/applicants within the Ponto Plan boundary for California Coastal Commission approval of the Ponto Plan or projects within same, or any permits for Ponto Plan projects from the U.S. Fish & Wildlife Service, the California Department of Fish and Game, the U.S. Army Corps of Engineers, Regional Water Quality Control Board, etc. 2287/026132-0002 . 949697.01 a02/24/09 "4- Encinitas' agreement not to challenge the implementation and development of the Ponto Plan as set forth in this Paragraph 2.4 is limited to development plans in the Ponto Plan that are consistent with the uses and development intensities approved by Carlsbad as of January 4, 2008; however, such development plans shall be deemed consistent with Carlsbad's approved uses and intensities provided that said changes in uses and intensities do not increase the traffic along Coast Highway 101 or La Costa Avenue as shown in the traffic report for the approved Ponto Plan. Section Three: Court Approval as a Condition to the Effectiveness of this Agreement 3.1 Neither this Agreement, nor any of its terms, conditions or covenants, shall become effective until the San Diego County Superior Court issues an order or ruling approving this Agreement and the settlement set forth herein (the "Settlement Approval"), and no developer or owner of land within the Ponto Plan boundary initiates or files any appeal or other litigation, action or proceeding (including but not limited to a proceeding in the Lawsuit) challenging the Settlement Approval within 60 days of the date of written notice of entry of the Settlement Approval (the "Effective Date"). 3.2 Within 30 days of the Execution Date, the cities shall jointly file a motion with the San Diego County Superior Court to which the Lawsuit is assigned for approval of the Settlement Agreement ("Settlement Approval Motion"). The cities shall give advance written notice to, and serve the Settlement Approval Motion on, a list of Ponto Plan landowners/ developers as may be supplied by Carlsbad, and any other persons or entities entitled to notice or whom Encinitas chooses to notice. 3.3 In the Settlement Approval Motion, the cities will request that the San Diego County Superior Court hold a hearing to consider granting the Settlement Approval. 3.4 In the event any litigation is filed challenging the Agreement or the Settlement Approval, the cities shall jointly defend such litigation challenges, and each city shall be solely responsible for its own costs and attorneys fees in connection therewith. Section Four: Warranties 4.1 Each person whose signature is affixed to this Agreement in a representative capacity represents and warrants that he or she is fully authorized to execute this Agreement on behalf of, and to bind, the city on whose behalf his or her signature is affixed, and that no other approvals or consents are necessary in connection therewith. 4.2 Each city represents and warrants that it has carefully read this Agreement and knows and understands its contents. Each city is represented by legal counsel and has had the opportunity to consult with its counsel to fully understand the terms of this Agreement. 4.3 Each city represents and warrants that it enters into this Agreement of its own free will, and not under the influence of duress, coercion or threat from any source. 2287/026132-0002 949697.01 a02/24/09 4.4 Encinitas warrants that it has made no assignment, and will make no assignment, of any claim, cause of action, right of action or any right of any kind whatsoever, embodied in any of the Released Claims. Section Five: Miscellaneous Provisions 5.1 No Admission of Liability. It is understood and agreed that in making this Agreement, Encinitas and Carlsbad each acknowledge that the compromise reached herein shall not be construed as an admission of liability or an admission of the sufficiency of any of the claims, defenses, counterclaims, allegations, assertions, or contentions in the Lawsuit; rather, this Agreement is a compromise of a dispute between the cities. 5.2 Costs and Attorneys Fees. Except as specifically provided herein, Encinitas and Carlsbad shall each bear its own costs, expenses and attorneys' fees related to the Lawsuit, the preparation and processing of this Agreement, and the processing of the Settlement Approval. 5.3 Integrated Agreement. This Agreement constitutes a single integrated written instrument expressing the entire agreement of the cities concerning this subject matter. No covenants, agreements, representations or warranties of any kind whatsoever have been made by either Encinitas or Carlsbad, except as specifically set forth in this Agreement. All prior and contemporaneous discussions and negotiations with respect to the subject matter of this Agreement have been and are merged and integrated into, and are superseded by, this Agreement. This Agreement may only be modified by a written instrument signed by both Encinitas and Carlsbad, which states that it modifies or amends this Agreement. 5.4 Cooperation. The cities agree to timely execute and deliver any and all documents and instruments necessary to effectuate the terms and conditions of this Agreement. 5.5 Disputes. Should any dispute arise as to the interpretation of the terms of this Agreement or whether the terms and conditions of this Agreement have been breached, the cities agree to submit this dispute to binding arbitration before Judge David Moon (Retired) (or, in the event Judge Moon is unavailable, (a) such other arbitrator agreed to by the cities or, (b) in the absence of any agreement, an arbitrator appointed by the San Diego County Superior Court in accordance with California Code of Civil Procedure Section 1281.6), whose decision shall be final and binding. The initial costs of said arbitration shall be borne equally by the cities. The prevailing party to the dispute shall be entitled to its attorneys' fees and costs of the arbitration. 5.6 Construction. This Agreement shall be construed under the laws of the State of California. 5.7 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be considered an original but all of which shall constitute one agreement. 5.8 Interpretation. The language of this Agreement shall be construed as a whole, according to its fair meaning and intent, regardless of who was principally responsible for drafting any specific term or condition. It is acknowledged that counsel for both Encinitas and Carlsbad have participated in the drafting of this Agreement. This Agreement shall be deemed to have been drafted by both Encinitas and Carlsbad, and no city shall argue otherwise. 2287/026132-0002 949697.01 a02/24/09 5.9 Successors and Assigns. This Agreement shall bind Encinitas and Carlsbad, and their respective successors and assigns. 5.10 Headings. All headings are for convenience of reference only and shall be disregarded in interpreting this Agreement. 5.11 Notices. Any payment, notice, request, demand, instruction, or other communication to be given to either city under this Agreement shall be in writing and personally delivered, delivered by reputable overnight delivery service, or sent by first class United States mail, postage prepaid and addressed as follows: If to Encinitas: If to Carlsbad: 505 S. Vulcan Avenue Encinitas, CA 92024 Attn: City Manager 1200 Carlsbad Village Drive Carlsbad, CA 92008 Attn: City Manager The addresses and contact persons for the purposes of this paragraph may be changed by giving written notice of such change in the manner provided in this paragraph, provided that such new address or contact person shall not become effective until first be acknowledged by the other city. IN WITNESS WHEREOF, the parties to this Agreement have executed this Agreement as of the date first written above. CITY OF ENCINITAS APPROVED AS TO FORM: By: City Attorney, City of Encinitas By:_ Its: Attest: City Clerk APPROVED AS TO FORM: - « c^ttjzz. City Attorney, City of Carlsbad 2287/026132-0002 949697.01 a02/24/09 CITY OF/CARLS Its: Attest: City Clerk -7-