HomeMy WebLinkAbout2014-04-22; City Council; 21574; Recommended Changes Carlsbad Energy Project, Consistent with Council Resolution 2014-010 Power Plant AgreementCITY OF CARLSBAD - AGENDA BILL
AB#
MTG.
DEPT.
21,574 RECOMMENDED CHANGES TO PRIOR CITY
ACTIONS IN SUPPORT OF THE AMENDED
CARLSBAD ENERGY CENTER PROJECT,
CONSISTENT WITH CITY COUNCIL RESOLUTION
NO. 2014-010 APPROVING THE POWER PLANT
AGREEMENT
DEPT. DIRECTOR
CITY ATTORNEY
CITY MANAGER
AB#
MTG.
DEPT.
4/22/14
RECOMMENDED CHANGES TO PRIOR CITY
ACTIONS IN SUPPORT OF THE AMENDED
CARLSBAD ENERGY CENTER PROJECT,
CONSISTENT WITH CITY COUNCIL RESOLUTION
NO. 2014-010 APPROVING THE POWER PLANT
AGREEMENT
DEPT. DIRECTOR
CITY ATTORNEY
CITY MANAGER
AB#
MTG.
DEPT. CED
RECOMMENDED CHANGES TO PRIOR CITY
ACTIONS IN SUPPORT OF THE AMENDED
CARLSBAD ENERGY CENTER PROJECT,
CONSISTENT WITH CITY COUNCIL RESOLUTION
NO. 2014-010 APPROVING THE POWER PLANT
AGREEMENT
DEPT. DIRECTOR
CITY ATTORNEY
CITY MANAGER
CS-250 repealing, in its entirety. Urgency Ordinance CS-
RECOMMENDED ACTION:
That the City Council (1) introduce Ordinance No. _
170; (2) approve Resolution 2014-074 , finding the City Council Resolution 98-145 requirement to
comprehensively update Specific Plan 144 no longer necessary as the purpose of that requirement is fulfilled; and
(3) approve Resolution 2014-075 accepting the transfer of all land use plans and functions of the former
Carlsbad Redevelopment Agency, assuming responsibility and authority for enforcement of said land use plans
and functions, and finding the Amended CECP complies with the land use policies of the South Carlsbad Coastal
Redevelopment Area Plan because the use is permitted by the General Plan and Zoning Ordinance and will serve
an extraordinary public purpose based on the findings ofthe City Council.
ITEM EXPLANATION:
On January 14, 2014, the Carlsbad City Council and the Carlsbad IVIunicipal Water District adopted resolutions
approving a settlement agreement (Agreement) between and among the City of Carlsbad (City) and the Carlsbad
Municipal Water District (CMWD), Cabrillo Power I LLC and Carlsbad Energy Center LLC (collectively NRG), and
San Diego Gas & Electric (SDG&E). The Agreement addresses City and CMWD support for a change in the
proposed technology ofthe approved Carlsbad Energy Center Project (CECP) plant and the submittal of a Petition
to Amend (PTA) application to the California Energy Commission (CEC) for approval of this technology change.
This support is conditioned upon the decommissioning, demolition, removal and remediation of the current
Encina Power Station (EPS) site by a certain date, as well as other changes in CECP plant design, energy
infrastructure and property considerations beneficial to the residents of Carlsbad. These significant benefits are
provided for in the approved Agreement.
Approval of the Agreement refiects a noteworthy shift in the City's and CMWD's position regarding the CECP.
Numerous environmental and land use concerns, including the possibility of having two power plants in
operation at the same time on Carlsbad's coastline, caused the City to oppose the power plant throughout the
five-year CEC certification process. Despite the City's previous objections, the CEC approved the project in 2012,
and it remains unbuilt. However, the dramatic change in the local energy supply environment (due to the
premature closure of the San Onofre Nuclear Generating Station), the proposed change in CECP technology with
reduced environmental and fire safety impacts, the date certain commitment to demolish and remove the EPS,
and the many significant benefits to Carlsbad outlined in the Agreement now enable the city to support an
"Amended CECP."
DEPARTMENT CONTACT: Debbie Fountain, Housing and Neighborhood Services Director, 760-434-2935
debbie.fountain(a)carlsbadca.gov: Scott Donnell, Senior Planner, 760-602-4618, scott.donnell@carlsbadca.gov
FOR CITY CLERKS USE ONLY. X COUNCIL ACTION: APPROVED X CONTINUED TO DATE SPECIFIC •
DENIED • CONTINUED TO DATE UNKNOWN •
CONTINUED • RETURNED TO STAFF •
WITHDRAWN • OTHER-SEE MINUTES •
AMENDED •
PageZ
The Agreement commits the City and CMWD, along with NRG, to "review all city ordinances, resolutions, policies,
regulatory documents, etc., that may confiict with the Amended CECP project...." The Agreement also requires
the City "to consider recommending revisions to such documents to the City Council and CMWD Board of
Directors."
City staff and NRG have identified the recommended legislative and other actions necessary to support the
Amended CECP. The first three identified actions requiring City Council approval are the subject of this agenda
bill; these actions, and reasons to support them, are listed below. The remaining actions requiring City Council
review, which are all public hearing items, are tentatively scheduled for City Council consideration in May. If
revisions to additional items are determined, they will be brought forward to the appropriate review body as
necessary. No CMWD Board actions are anticipated at this time.
1. Repeal City Council Urgency Ordinance CS-170.
The urgency ordinance amended the Public Utilities Zone to require a conditional use permit for the
generation and transmission of energy with an additional finding that the use serves an extraordinary
public purpose. The finding is a requirement ofthe South Carlsbad Coastal Redevelopment Area Plan. The
City Council passed this ordinance in January 2012 in response to the state's dissolution of redevelopment
agencies and resulting ambiguity of the status of the South Carlsbad Redevelopment Area Plan. Adoption
ofthe urgency ordinance was not subject to California Coastal Commission approval.
The recommended repeal of Urgency Ordinance CS-170 simply restores the previous text that permits
"generation and transmission of electrical energy" - this would allow generation within the Coastal Zone.
Moreover, as it is now known that the South Carlsbad Coastal Redevelopment Area Plan remains a valid
planning document despite the state's dissolution action, its extraordinary public purpose requirement
continues to apply; a recommended and separate action of this agenda bill is to approve a resolution
finding the Amended CECP complies with the land use plans ofthe South Carlsbad Coastal Redevelopment
Area Plan.
2. Find the City Council Resolution 98-145 requirement to comprehensively update Specific Plan 144 is no
longer necessary as the purpose of that requirement is fulfilled.
City Council policy, established by Resolution of Intention 98-145 (attached), requires any proposed
development within the Encina Specific Plan 144 to comprehensively update the specific plan; the
Amended CECP would be subject to this policy.
Among other things, the purpose of the comprehensive update requirement is to address inconsistent
zoning and General Plan designations, implement Local Coastal Plan requirements, and potentially
consider alternative land uses, including for the Encina Power Station. Besides the power plant, the 680-
acre Specific Plan 144 encompasses the Agua Hedionda Lagoon and nearby properties and agricultural and
vacant lands along the north side of Cannon Road and east of Interstate 5. At the time of the policy's
adoption, SDG&E owned all property within Specific Plan 144.
The policy was confirmed and its implementation clarified in 2002 when the City Council by minute motion
established that the comprehensive update should be applicant/property owner-initiated. Subsequently,
the city has continued to apply the comprehensive update requirement to public and private projects and
also recommended unsuccessfully the CEC require it of the original CECP.
The City Council has also waived the requirement for some proposals, such as the Carlsbad Desalination
Project. Reasons for this determination included the modern office building design and location of the
desalination project, which would not be detrimental to any future redevelopment of the Encina Power
Station, and the dedications of public access and use easements along the lagoon and coastline.
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To date, Specific Plan 144 has not been comprehensively updated. However, staff believes this
requirement is no longer needed due to the following land use actions and project approvals that have
occurred since the resolution's adoption:
a. The Agreement between the city, CMWD, NRG and SDG&E satisfactorily addresses the many long-
term, unresolved issues regarding the Encina Power Station and its demolition and site
remediation, its initial redevelopment strategy, future power generation, and disposition of
SDG&E properties along Carlsbad Boulevard.
b. The draft preferred land use plan, prepared for the General Plan Update, identifies visitor-serving
commercial and open spaces uses for the Encina Power Station and adjacent SDG&E operations
center.
c. Poseidon Resources has agreed to long term stewardship of Agua Hedionda Lagoon, including its
dredging, upon shut down ofthe Encina Power Station.
d. Specific Plan 144 agricultural properties east of 1-5 and north of Cannon Road are within the
Cannon Road Open Space, Farming and Public Use Corridor and are limited to agricultural and
open space uses consistent with Proposition D.
e. The revision of the Agua Hedionda Land Use Plan, part of the city's Local Coastal Program for the
power plant and lagoon area, is a planned action of the overall General Plan Update now
underway.
Furthermore, a future public hearing item will recommend repeal of the entire Specific Plan 144; future
development of land within the boundaries of the Specific Plan can be adequately regulated by other
existing and future land use documents.
Finally, Resolution 98-145 directed staff to consider the repeal or amendment of the public utility
exemptions from the Zoning Ordinance's non-conforming use provisions. These exemptions were
removed as part of the repeal and replacement of the city's non-conforming building and use standard,
which became effective in 2013.
3. Approve a resolution finding the Amended CECP complies with the land use plans of the South Carlsbad
Coastal Redevelopment Area Plan.
During CEC proceedings for the approved CECP, the former Carlsbad Redevelopment Agency indicated that
the project was not consistent with the South Carlsbad Coastal Redevelopment Area (SCCRA) Plan because
a finding (or findings) could not be made that the CECP provided for an extraordinary public purpose. This
determination could not be made in part due to the fact that there was not a demonstrated need for the
power to be generated from the CECP and the fact that two power plants could potentially operate on the
coastal (redevelopment) property for an indefinite period oftime; thus, there would be no elimination of
blight or blighting condition in the redevelopment area.
Per State Assembly Bill 1484 which went into effect June 27, 2011, the Carlsbad Redevelopment Agency
was dissolved as of February 1, 2012, and the City of Carlsbad assumed the role of Successor Agency as
permitted by Health and Safety Code Section 34173. The City of Carlsbad may also accept the transfer of
all land use related plans and land use review functions ofthe former Redevelopment Agency per Health
and Safety Code Section 34173(h)(i), including responsibility for implementation of the South Carlsbad
Coastal Redevelopment Area Plan; to date, no action has been taken by the City Council for the City of
Carlsbad to assume this function of the former Redevelopment Agency. If approved, the City of Carlsbad
will accept the transfer of the function of land use review as associated with the South Carlsbad Coastal
Redevelopment Area Plan in the City Council resolution set forth in Exhibit 3, and accept authorization to
make the extraordinary public purpose findings required to approve a power generating plant within the
redevelopment plan area.
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All land uses permitted in the SCCRA Plan are those permitted by the General Plan and Zoning Ordinance,
with the exception that uses for the generation and transmission of electrical energy and similar utilities
are permitted only if a finding is approved that the land use serves an extraordinary public purpose. As
there was no finding of extraordinary public purpose approved for the original CECP, neither the City nor
the former Redevelopment Agency could approve the proposed land use and support the application.
The City Council, on behalf of the former Redevelopment Agency, and due to the many benefits to be
received as a result ofthe approved Agreement, has determined that the Amended CECP is now consistent
with the SCCRA Plan and with approval ofthe extraordinary public purpose findings as set forth more fully
in the attached resolution.
FISCAL IMPACT:
Approval of City Council Resolution 2014-010 appropriated $200,000 from the General Fund to be used in the
city's efforts in regards to the CECP and the implementation ofthe Agreement.
ENVIRONMENTAL IMPACT:
Pursuant to Public Resources Code Section 21065, the proposed actions do not constitute "projects" within the
meaning of CEQA in that they have no potential to cause either a direct physical change in the environment, or a
reasonably foreseeable indirect physical change in the environment, and therefore do not require environmental
review.
Furthermore, environmental review of the Amended CECP as contemplated by the Agreement is within the
exclusive jurisdiction of other agencies, including without limitation the California Energy Commission and
California Public Utilities Commission, which have served and/or will serve as the Lead Agencies for compliance
with the California Environmental Quality Act (CEQA).
EXHIBITS:
1. City Council Ordinance No. CS-250
2. City Council Resolution No. 2014-074
3. City Council Resolution No. 2014-075
4. Exhibit of Zoning Ordinance text changes resulting from repeal of Urgency Ordinance CS-170
5. City Council Resolution of Intention 98-145.
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EXHIBIT 1
ORDINANCE NO. CS-250
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
CARLSBAD, CALIFORNIA, REPEALING URGENCY
ORDINANCE CS-170, WHICH AMENDED ZONING
ORDINANCE CHAPTER 21.36, PUBLIC UTILITY ZONE, AND
SPECIFICALLY SECTION 21.36.020, PERMITTED USES,
REGARDING GENERATION AND TRANSMISSION OF
ELECTRICAL ENERGY.
WHEREAS, in May of 2012, the California Energy Commission (CEC)
approved NRG's application for certification ofthe Carlsbad Energy Center Project (CECP),
a thermal power plant, over the vigorous objections of the City of Carlsbad and the
Carlsbad Redevelopment Agency; and
WHEREAS, as part of its objections, the City Council adopted Urgency
Ordinance CS-170 on January 10, 2012, pursuant to Carlsbad Municipal Code 1.20.610
and Government Code Section 36937, to amend Zoning Ordinance Chapter 21.36 of the
Carlsbad Municipal Code, Public Utility Zone; and
WHEREAS, adoption of an urgency ordinance was necessary for the
immediate preservation of the public peace, health and safety, which was justified by
several facts, including the proposed development ofthe CECP within the South Carlsbad
Coastal Redevelopment Area Plan (SCCRA) and Coastal Zone; and the negative impacts
construction of the CECP would cause to sensitive coastal resources, land uses, and the
public's health, safety and welfare; a California Supreme Court decision negatively
impacting redevelopment plans, including the SCCRA, in which the CECP site is located;
and, the city's potential inability, due to the court decision, of applying the SCCRA
requirement that generation and transmission of electrical energy must serve an
extraordinary public purpose; and
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WHEREAS, specifically, Urgency Ordinance CS-170 amended Zoning
Ordinance Section 21.36.020, including Table A, to require a Conditional Use Permit for
the generation and transmission of electrical energy and a finding by the City Council that
the use serves an extraordinary public purpose, the latter a requirement of the SCCRA;
and
WHEREAS, since October, 2012, the energy supply environment in
Southern California has dramatically changed due to the permanent closure of the San
Onofre Nuclear Generation Station (SONGS) and as a result the California Independent
System Operator (CAISO) and the California Public Utilities Commission (CPUC) have
determined that additional power generation capacity is currently needed in the San
Diego Region by 2018; and
WHEREAS, most recently on March 13, 2014, the CPUC approved a
decision addressing San Diego Gas and Electric's (SDG&E) need to procure gas-fired
power generation of up to 600 MWs in the San Diego region; and
WHEREAS, given the recent CAISO and CPUC determination of power
needs in the San Diego region, SDG&E recently indicated its interest in entering into a
Power Purchase Agreement (PPA) with NRG for electricity generated from the CECP, but
only if NRG is willing to change the proposed technology of the approved CECP from a
"combined-cycle configuration" plant to a "peaker configuration" plant and submit a
Petition to Amend (PTA) application to the CEC for the previously approved CECP; and
WHEREAS, NRG is interested in submitting a PTA application, but only if
the City would be supportive ofsuch an application; and
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WHEREAS, on January 14, 2014, the City Council and Carlsbad Municipal
Water District approved the Settlement Agreement (Agreement) between and among the
City of Carlsbad, the Carlsbad Municipal Water District, Cabrillo Power I LLC and Carlsbad
Energy Center LLC (collectively "NRG"), and SDG&E to support a change in the proposed
technology of the approved CECP and the submittal of a PTA application to the CEC for
approval of the technology change, conditioned upon the decommissioning, demolition,
removal and remediation ofthe current Encina Power Station (EPS) site by a date certain,
as well as other changes in CECP plant design, energy infrastructure and property
considerations beneficial to the residents of Carlsbad; and
WHEREAS, the repeal of Urgency Ordinance CS-170 is contemplated in
response to the Agreement, which directs staff to review the City's prior legislative
actions concerning the CECP and recommend changes, if any, as may be necessary to
reflect the changed circumstances, reduced environmental profile and significant
community benefits associated with the amendment; and
WHEREAS, after procedures in accordance with requirements of law, the
City Council has determined that the public interest indicates that the repeal of Urgency
Ordinance CS-170 be approved.
NOW, THEREFORE, the City Council of the City of Carlsbad does ordain as
follows that:
SECTION 1: The above recitations are true and correct.
SECrriON 2: That the conditions which led to the adoption of Urgency
Ordinance CS-170, as noted in the above recitations, are no longer applicable due to the
Agreement provisions for decommissioning, demolition, removal and remediation of the
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current Encina Power Station (EPS) site, as well as other changes in CECP plant design,
energy infrastructure and property considerations beneficial to the residents of Carlsbad
as stipulated in the Agreement.
SECTION 3: Ordinance CS-170 is repealed.
EFFECTIVE DATE: This ordinance shall be effective thirty days after its
adoption; and the city clerk shall certify the adoption ofthis ordinance and cause the full text
of the ordinance or a summary of the ordinance prepared by the City Attorney to be
published at least once in a newspaper of general circulation in the City of Carlsbad within
fifteen days after its adoption.
INTRODUCED AND FIRST READ at a regular meeting of the Carlsbad City
Council on the 22riddav of April . 2014. and thereafter.
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PASSED AND ADOPTED at a regular meeting ofthe City Council ofthe City of
Carlsbad on the.
AYES:
NOES:
ABSENT:
_day of. 2014, by the following vote, to wit:
APPROVED AS TO FORM AND LEGALITY:
CELIA A. BREWER, City Attorney
MATT HALL, Mayor
ATTEST:
BARBARA ENGLESON, City Clerk
-5-
EXHIBIT 2
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RESOLUTIONNO. 2014-074
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD,
CALIFORNIA, FINDING THE REQUIREMENT OF CITY COUNCIL
RESOLUTION 98-145 TO COMPREHENSIVELY UPDATE SPECIFIC
PLAN 144 IS NO LONGER NECESSARY AS THE PURPOSE OF THAT
REQUIREMENT IS FULFILLED.
WHEREAS, on May 12,1998, the City Council adopted Resolution of Intention 98-
145, declaring its intention to study and consider amendments to the General Plan, Zoning
designations and the Zoning Ordinance pertaining to the Encina Power Plant and surrounding
properties then under the ownership ofthe San Diego Gas and Electric Company and directing
staff to prepare a work plan and commence a study regarding the amendments; and
WHEREAS, the resolution of intention was directed not only at the Encina Power
Station but all other properties within the 680-acre Encina Specific Plan (Specific Plan 144),
which encompasses Agua Hedionda Lagoon and surrounding properties and extends from the
Pacific Ocean to Cannon Road to the east; and
WHEREAS, the purpose and objective of Resolution 98-145 was to
comprehensively study Specific Plan 144 properties to address the many long-term, unresolved
issues regarding specific land uses, including use ofthe power plant property, inconsistent land
use designations and Local Coastal Program requirements which had not been addressed,
among others; and
WHEREAS, the resolution also directed staff to consider the repeal or
amendment of the public utility exemptions from the Zoning Ordinance's non-conforming use
provisions; and
WHEREAS, on June 11, 2002, the City Council confirmed that the comprehensive
analysis or specific plan update should be applicant/property owner-initiated, and, although the
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1 update has not occurred and has been waived as a requirement by the City Council from time
^ to time, the city has continued to apply the requirement to development proposals in Specific
Plan 144, both public and private; and
WHEREAS, in May of 2012, the California Energy Commission (CEC) approved
NRG's application for certification of the Carlsbad Energy Center Project (CECP) over the
7 vigorous objections of the City of Carlsbad and the Carlsbad Redevelopment Agency; and
8 WHEREAS, as part of the certification proceedings, the city recommended
unsuccessfully the CEC apply the comprehensive update requirement; and
WHEREAS, since October, 2012, the energy supply environment in Southern
California has dramatically changed due to the permanent closure of the San Onofre Nuclear
Generation Station (SONGS) and as a result the California Independent System Operator
14 (CAISO) and the California Public Utilities Commission (CPUC) have determined that additional
15 power generation capacity is currently needed in the San Diego Region by 2018; and
WHEREAS, most recently on March 13, 2014, the CPUC approved a decision
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addressing San Diego Gas and Electric's (SDG&E) need to procure gas-fired power generation
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up to 600 MWs in the San Diego region; and
2Q WHEREAS, given the recent CAISO and CPUC determination of power needs in
21 the San Diego region, SDG&E recently indicated its interest in entering into a Power Purchase
22 Agreement (PPA) with NRG for electricity generated from the CECP, but only if NRG is willing to
change the proposed technology ofthe approved CECP from a "combined-cycle configuration"
plant to a "peaker configuration" plant and submit a Petition to Amend (PTA) application to the
CEC for the previously approved CECP; and
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1 WHEREAS, NRG is interested in submitting a PTA application, but only if the City
2 and former Redevelopment Agency would be supportive of such an application; and
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WHEREAS, on January 14, 2014, the City Council and Carlsbad Municipal Water
4
District approved the Settlement Agreement (Agreement) between and among the City of
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, Carlsbad, the Carlsbad Municipal Water District, Cabrillo Power I LLC and Carlsbad Energy 6
7 Center LLC (collectively "NRG"), and SDG&E to support a change in the proposed technology of
8 the approved CECP and the submittal of a PTA application to the CEC for approval of the
technology change, conditioned upon the decommissioning, demolition, removal and
remediation of the current Encina Power Station (EPS) site by a certain date, as well as other
changes in CECP plant design, energy infrastructure and property considerations beneficial to
the residents of Carlsbad; and
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14 WHEREAS, the Agreement directs staff to review the City's prior legislative
15 actions concerning the CECP and recommend changes, if any, as may be necessary to reflect the
changed circumstances, reduced environmental profile and significant community benefits
associated with the amendment; and
WHEREAS, staff has reviewed Resolution 98-145 as one of the prior legislative
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2Q actions, and, based on the many benefits provided in the Agreement as well as land use actions
21 and project approvals that have occurred since 1998 or that are presently underway,
22 recommends the resolution's requirement to comprehensively update Specific Plan 144 is no
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longer necessary as the purpose of that requirement is fulfilled; and
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WHEREAS, these land use actions and project approvals include the Agreement,
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which satisfactorily addresses the many long-term, unresolved issues regarding the Encina
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27 Power Station and its demolition and site remediation, its initial redevelopment strategy, future
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1 power generation, and disposition of SDG&E properties along Carlsbad Boulevard; the draft
2 preferred land use plan prepared for the General Plan Update, which identifies visitor-serving
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commercial and open spaces uses forthe Encina Power Station and adjacent SDG&E operations
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center; the long term stewardship of Agua Hedionda Lagoon by Poseidon Resources, including
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, its dredging, upon shut down of the Encina Power Station; the approval of the Cannon Road
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7 Open Space, Farming and Public Use Corridor, which applies to Specific Plan 144 agricultural
8 properties east of 1-5 and north of Cannon Road and which limits these properties to
^ agricultural and open space uses consistent with Proposition D; and the Agua Hedionda Land
Use Plan, part ofthe city's Local Coastal Program for the power plant and lagoon area, which is
a planned action ofthe overall General Plan Update now underway.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad,
14 California, as follows:
15 1. That the above recitations are true and correct.
2. That the City Council finds the City Council Resolution 98-145
17 requirement to comprehensively update Specific Plan 144 is no longer necessary as the purpose
of that requirement is fulfilled.
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3. That City Council Ordinance CS-050, adopted in 2009, repealed and
replaced the city's former non-conforming building and use standards (Carlsbad Municipal Code
20 Chapter 21.48) and specifically repealed the public utility exemptions therein.
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PASSED, APPROVED AND ADOPTED at a Regular Meeting ofthe City Council ofthe City
of Carlsbad on the 22"'' day of April, 2014, by the following vote to wit:
AYES:
NOES:
Council Members Packard, Wood, Schumacher and Blackburn.
None.
ABSENT: Council Member Hall.
MARK PACKARD, Mayor Pro Tem
ATTEST:
BARBARA ENGLESON, City Clerk
(SEAL)
EXHIBIT 3
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RESOLUTION NO. 2014-075
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD,
ACCEPTING THE TRANSFER OF ALL LAND USE PLANS AND
FUNCTIONS OF THE FORMER CARLSBAD REDEVELOPMENT
AGENCY, ASSUMING RESPONSIBILITY AND AUTHORITY FOR
4 ENFORCEMENT OF SAID LAND USE PLANS AND FUNCTIONS, AND
FINDING THE CECP AMENDMENT COMPLIES WITH THE LAND USE
5 POLICIES OF THE SOUTH CARLSBAD COASTAL REDEVELOPMENT
AREA PLAN BECAUSE THE USE IS PERMITTED BY THE GENERAL
PLAN AND ZONING ORDINANCE AND WILL SERVE AN
7 EXTRAORDINARY PUBLIC PURPOSE BASED QN THE FINDINGS OF
THE CITY COUNCIL.
WHEREAS, in May of 2012, the California Energy Commission (CEC) approved
NRG's application for certification of the Carlsbad Energy Center Project (CECP) over the
11 vigorous objections of the City of Carlsbad and the Carlsbad Redevelopment Agency; and
12 WHEREAS, during the CEC proceedings the City of Carlsbad and the Carlsbad
13
Redevelopment Agency took certain legislative actions concerning the construction ofthe new
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CECP, including action by the former Carlsbad Redevelopment Agency indicating that the CECP
15
was not consistent with the South Carlsbad Coastal Redevelopment Area (SCCRA) Plan because
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17 a finding (or findings) could not be made that the CECP provided for an extraordinary public
18 purpose in part due to the fact that there was not a demonstrated need for the power to be
generated from the CECP and the fact that two power plants could potentially operate on the
coastal (redevelopment) property for an indefinite period oftime, not eliminating this blight or
blighting condition in the redevelopment area; and
WHEREAS, since October, 2012, the energy supply environment in Southern
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24 California has dramatically changed due to the permanent closure of the San Onofre Nuclear
25 Generation Station (SONGS) and as a result the California Independent System Operator
(CAISO) and the California Public Utilities Commission (CPUC) have determined that additional
27
power generation capacity is currently needed in the San Diego Region by 2018; and
28 "
1 WHEREAS, most recently on March 13, 2014, the CPUC approved a decision
2 addressing San Diego Gas and Electric's (SDG&E) need to procure gas-fired power generation
up to 600 MWs in the San Diego region; and
WHEREAS, given the recent CAISO and CPUC determination of power needs in
the San Diego region, SDG&E recently indicated its interest in entering into a Power Purchase
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7 Agreement (PPA) with NRG for electricity generated from the CECP, but only if NRG is willing to
8 change the proposed technology of the approved CECP from a "combined-cycle configuration"
plant to a "peaker configuration" plant and submit a Petition to Amend (PTA) application to the
CEC for the previously approved CECP; and
WHEREAS, NRG is interested in submitting a PTA application, but only if the City
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J2 and former Redevelopment Agency would be supportive of such an application; and
14 WHEREAS, per State Assembly Bill 1484 which went into effect June 27, 2011,
15 the Carlsbad Redevelopment Agency was dissolved as of February 1, 2012, and the City of
Carlsbad assumed the role of Successor Agency as permitted by Health and Safety Code Section
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34173 and the City of Carlsbad also accepts the transfer of all land use related plans and
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functions ofthe former Redevelopment Agency; and
20 WHEREAS, as home to the existing Encina Power Station (EPS) since the 1950s
21 and the numerous other regional facilities, Carlsbad understands a community's responsibility
22 in hosting regional resources; and
WHEREAS, on January 14, 2014, the City Council and Carlsbad Municipal Water
District approved the Settlement Agreement (Agreement) between and among the City of
Carlsbad, the Carlsbad Municipal Water District, Cabrillo Power I LLC and Carlsbad Energy
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technology change, conditioned upon the decommissioning, demolition, removal and
remediation of the current Encina Power Station (EPS) site by a date certain, as well as other
changes in CECP plant design, energy infrastructure and property considerations beneficial to
the residents of Carlsbad; and
1 the approved CECP and the submittal of a PTA application to the CEC for approval of the
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7 WHEREAS, all land uses permitted in the SCCRA Plan are those permitted by the
8 General Plan and zoning ordinance, with the exception that uses for the generation and
transmission of electrical energy and similar utilities are permitted only if a finding is approved
that the land use serves an extraordinary public purpose; and
WHEREAS, there was no finding of extraordinary public purpose approved for
the original CECP and therefore neither the City nor the former Redevelopment Agency could
14 approve the proposed land use and support the application; and
15 WHEREAS, due to the proposed change in technology, demolition and removal
of the EPS by a date certain, and the other public benefits to be received as a result of the
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Agreement approved by the City on January 14, 2014, the City has determined that it can now
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make the required finding(s) of extraordinary public purpose and support the PTA application
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2Q for the CECP as set forth within this resolution; and
21 WHEREAS, the City Council has determined the CECP, as proposed for
22 amendment and set forth in the Agreement, will provide extraordinary public benefit to the
community, including the South Carlsbad Coastal Redevelopment Area, if all parties comply
with the approved aforementioned Agreement; and
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1 WHEREAS, the City Council of the City of Carlsbad, on behalf of the former
2 Redevelopment Agency, has determined that the CECP proposal is now consistent with the
SCCRA Plan with approval of the extraordinary public purpose findings as set forth within this
Resolution.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad,
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8 1. That the above recitations are true and correct
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2. That the City Council hereby accepts the transfer of all land use plans and
functions of the former Carlsbad Redevelopment Agency, and has assumed responsibility and
authority for enforcement of said land use plans and functions, including the active South
11 Carlsbad Coastal Redevelopment Area Plan, until such time as the plan effectiveness date
expires.
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^2 3. That the City Council hereby determines that the PTA application
proposed by NRG to amend the CECP, as described in the Agreement dated January 14, 2014,
14 complies with the South Carlsbad Coastal Redevelopment Area Plan land use policies because it
is permitted by the General Plan and zoning ordinance and will include the following benefits
15 which the City Council finds represent an extraordinary public purpose as required by the South
Carlsbad Coastal Redevelopment Area Plan:
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17 a. NRG will amend its CECP project, proposing a plant that is more
environmentally friendly, lower profile, utilizing "peaker configuration" technology, with the
18 amount of power generation and hours of operation capped (6am to midnight, unless
otherwise directed by CAISO), consistent with the Agreement dated January 14, 2014; and
1^ b. NRG will immediately begin the process to completely shut down the
existing Encina Power Station (EPS) at no cost to taxpayers and will shut down the EPS the
earlier of midnight December 31, 2017 or the commercial operation date of CECP Amended or
21 face liquidated damages as set forth in the Agreement, and will commence demolition of the
EPS within one year of shutdown and complete demolition within two years of start of
22 demolition; and
c. SDG&E will pursue the relocation of its operations yard ("North Coast
Service Center") at NRG's expense and transfer ownership ofthe service center property (along
24 with the Cannon Park and the Agua Hedionda Lagoon North Shore Bluff Parcel) from SDG&E to
the City, freeing up the service center land for more appropriate uses. If it is ultimately not
25 possible to relocate the service center, NRG will pay the city $10 million; and
d. Immediate action to begin the process for a redevelopment plan for a
remediated Encina Power Station site; and
27 e. New design for CECP will address all Carlsbad Fire Department public
safety concerns; and
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f. Cooperation from NRG to determine a mutually acceptable alignment for
the Coastal Rail Trail; and
g. Liquidated damages (estimated at $3.6 million to $12 million annually) if
the EPS continues to operate after CECP becomes operational; and
h. NRG will grant Irrevocable Offers of Dedication (lODs) for fee title
ownership to the City, in addition to the easements already agreed to as a part ofthe Poseidon
Desalination Plant project, to include the Bluff Area Parcel, Fishing Beach Parcel, Hubbs Site
parcel, and South Power Plant parcel; and
i. Electrical generation reliability will be enhanced through development of
the amended CECP, which will benefit Carlsbad as well as the larger San Diego region.
4. That based on the fact that the City Council now has authority and
responsibility for implementation ofthe South Carlsbad Coastal Redevelopment Area Plan from
a land use review and approval function perspective, the City Council finds that the proposed
amended application for the CECP is consistent with Section VI. (600) ofthe Plan and that the
Agreement approved on January 14, 2014 sets forth appropriate public benefits to justify a
finding of extraordinary public purpose as required by the South Carlsbad Coastal
Redevelopment Area Plan.
5. That based on the facts set forth herein, the City Council finds that the
proposed PTA application for the CECP will result in construction of a replacement power plant
that serves an extraordinary public purpose, will have less environmental and visual impact on a
key coastal property than the original CECP, and will result in removal of the existing power
plant which has existed on the coastal site since the 1950s and has been identified within the
South Carlsbad Coastal Redevelopment Area Plan as representing blight or a blighting condition
which needs to be addressed to successfully redevelop the area.
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1 PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City
2 of Carlsbad on the 22"'' day of April, 2014, by the following vote to wit:
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AYES: Council Members Packard, Wood, Schumacher and Blackburn.
NOES: None.
ABSENT: Council Member Hall.
MARK PACKARD, Mayor Pro Tem
ATTEST:
BARBARA ENGLESON, Citv<€lerk , City<^(
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EXHIBIT 4
APRIL 22, 2014
AMENDED CECP
TEXT REVISIONS THAT WOULD RESULT FROM REPEAL OF URGENCY ORDINANCE CS-170
(Revisions affect the P-U Public Utility Zone, Zoning Ordinance Section 21.36.020)
(Note: The proposed text addition is shown as bold and underlined. The proposed text deletions
are shown as strickon.j
21.36.020 Permitted Uses
B. The uses permitted by conditional use permit, as indicated in Table A, shall be subject to
the provisions of Chapter 21.42 of this title. Approval of a conditional uso pormit is requirod for
tho gonoration and transmission of oloctrical onorgy and shall roquiro a finding by tho city
council that the uso servos an oxtraordinary public purpose in addition to tho othor findings
roquirod for a conditional uso found in Choptor 21.^2.
Table A
Permitted Uses
In the table, below, subject to all applicable permitting and development requirements of the
municipal code:
"P" indicates use is permitted. (See note 1 below)
"CUP" indicates use is permitted with approval of a conditional use permit. (See note 1
below)
1 = Minor Conditional Use Permit (Process One), pursuant to Chapter 21.42 ofthis title.
2 = Minor Conditional Use Permit (Process Two), pursuant to Chapter 21.42 ofthis title.
3 = Minor Conditional Use Permit (Process Three), pursuant to Chapter 21.42 of this title.
"Acc" indicates use is permitted as an accessory use.
Use P CUP Acc
Generation and transmission of electrical energy X
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EXHIBIT 5
1 CITY COUNCIL RESOLUTION OF INTENTION NO. 98-145
2 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CARLSBAD. CALIFORNIA, DECLARING ITS INTENTION
TO STUDY AND CONSIDER AMENDMENTS TO THE
4 GENERAL PLAN, ZONING DESIGNATIONS AND THE
ZONING ORDINANCES PERTAINING TO THE ENCINA
5 POWER PLANT AND SURROUNDING PROPERTIES
PRESENTLY UNDER THE OWNERSHIP OF THE SAN
6 DIEGQ GAS AND ELECTRIC COMPANY
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8 WHEREAS, the San Diego Gas and Electric Company (SDG&E) initially
9 constructed the Encina Power Plant in approximately 1952; and
WHEREAS, the Public Utility (PU) Zone was established in 1971 and
applied to the Encina Power Plant and surrounding properties owned by SDG&E; and
WHEREAS, in conformance with the PU Zone, a Specific Plan was
adopted for the 680 acre SDG&E ownership including the Power Plant site; and
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25 WHEREAS, the General Plan designation establishing a Public Utilities
16 (U) land use classification was created in 1974 and subsequently applied to the Encina
1^ Power Plant; and
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WHEREAS, in 1973 the City Council approved an amendment to the
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Specific Plan to permit enlargement of the Power Plant including the construction of a
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400 foot high stack as a means of dispersing Power Plant air emissions and reducing
22 adverse impacts on surrounding residential neighborhoods; and
23 WHEREAS, the amended Specific Plan required notice and public
24 hearings for any subsequent changes to the Plan; and
WHEREAS, there have been a number of changes made at the Power
Plant without notice and hearings including a fuel tank installation in 1975, a two-story
50'x16' control room in 1977, the relocation of a maintenance building, expansion of a
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EXHIBIT 5
1 switching substation and driveway in 1980, the expansion of a distribution substation in
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1982, the addition of a 6,168 square foot administration building in 1984, the
remodeling of the electric shop in 1985, addition of a storeroom and repair facility in
1986, the construction of a 24' x 40' pipe storage shed in 1986, the construction of a
30' x 30' metal paint shop in 1986, the addition of numerous microwave dishes and
radio antenna attached to the stack, and the addition of temporary office trailers; and
8 WHEREAS, SDG&E was informed that any future modifications, changes,
9 amendments or additions to its plant would require a complete major amendment to the
specific plan processed in accordance with Chapter 21.36 of the Carlsbad Municipal
Code, and at that time, the cumulative impact of all previous changes would be
considered and an analysis would be made as to whether any conditions are necessary
to address those cumulative impacts; and
15 WHEREAS, in 1975, the PU Zone was updated to require a Precise
16 Development Plan (PDP) rather that a Specific Plan for public utility uses; and
WHEREAS, SDG&E has been informed that a Precise Development Plan
is needed for the Power Plant site; and
WHEREAS, the Agua Hedionda Local Coastal Plan (LCP) was adopted in
1982 which includes the properties owned by SDG&E including the Encina Power Plant
22 site; and
23 WHEREAS, the LCP contains numerous regulations and restrictions
24 which impact the SDG&E properties and the Power Plant including public access, land
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use, recreation, agriculture, aquaculture, visual impacts and uses ofthe lagoon; and
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EXHIBIT 5
WHEREAS, the existing Specific Plan for the SDG&E properties does not
address the regulations and restrictions ofthe LCP; and
WHEREAS, the City applied to the Coastal Commission to obtain effective
certification for the Agua Hedionda LCP but was requested by SDG&E to withdraw the
application which the city subsequently did based upon a commitment by SDG&E that it
would update its Specific Plan and bring the Power Plant site into conformance with the
Site Development Plan ("Plan") requirements contained in Chapter 21. 36 of the
Carlsbad Municipal Code; and
WHEREAS, SDG&E did not follow through on its commitment regarding
the LCP; and
WHEREAS, the Zoning designations on the SDG&E properties are not in
strict conformance with the General Plan designations on the properties in that portions
of the properties are zoned Public Utility (PU) but are designated on the General Plan
for Open Space (OS) or Travel/Recreational Commercial (TR) use; and
WHEREAS, because of the aforementioned occurrences and unresolved
issues, the city has requested of SDG&E on numerous occasions that it prepare a
comprehensive, updated Plan for the existing and future use and development of its
property; and
WHEREAS, despite numerous verbal agreements to do an updated Plan,
SDG&E has not come fonward with a formal proposal, work program or timeline for
initiating a process to update its Plan and address outstanding concerns and issues;
and
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EXHIBIT 5
WHEREAS, SDG&E has now informed the city that it is mandated by the
courts to divest itself from its electric generating operations and facilities and has
applied to the California Public Utilities Commission for pennission to sell the Encina
Power Plant to a private operator without addressing or agreeing to address the
aforementioned issues regarding outdated plans, land use inconsistencies, coastal
concerns and unfulfilled commitments; and
WHEREAS, the sale of the Power Plant site to a private operator raises
additional issues and public concerns including future restrictions on public access to
the Agua Hedionda Lagoon, future dredging ofthe lagoon, restrictions on the use ofthe
site to only industrial or power generation notwithstanding consideration of the public
health, safety or general welfare, the disposition of Cannon Park, proposed future
changes of land use, the continuation of aquaculture and research at the lagoon, beach
area improvements, environmental clean-up and mitigation related to oil and fuel
storage and usage; and
WHEREAS, the city believes that it is necessary in order to protect the
interests of its citizens for the city staff to initiate a process to address the
aforementioned issues and concerns and to study and consider a comprehensive,
updated plan for the SDG&E properties including the Encina Power Plant site; and
WHEREAS, the city believes that it is necessary for this process to
include consideration of amendments to the existing Zoning and General Plan
designations ofthe SDG&E properties; and
WHEREAS, these considerations should include whether the continued
use of a portion ofthe property for a Power Plant is in the best interest of the citizens of
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EXHIBIT 5
Carlsbad and is the best, long-term use of the property given its superior coastal
location and its proximity to other existing, surrounding uses that can be adversely
impacted by Power Plant use; and
WHEREAS, since SDG&E intends to sell the Encina Power Plant to a
private operator, Section 21.48.100 of the Carlsbad Municipal Code which exempts
Public Utilities from certain non-conforming use provisions ofthe Zoning Ordinance may
no longer be appropriate or necessary and this code section should be considered for
amendment or repeal.
NOW, THEREFORE, BE IT HEREBY RESOLVED by the City Council of
the City of Carlsbad, California as follows:
1. That the above recitations are true and correct.
2. That pursuant to Section 21.52.020 of the Carlsbad Municipal Code and
Section 65358 of the State Government Code, the City Council of the City of Carlsbad
declares its Intention to consider amendments to the General Plan and the Zoning
Ordinance as it pertains to the Encina Power Plant and the surrounding properties now
under the ownership of the San Diego Gas and Electric Company (SDG&E) as shown
on the attached location map and labeled Exhibit "A".
3. City staff is hereby directed to study this matter, prepare
recommendations and to set public hearings before the Planning Commission and City
Council to determine whether the present General Plan and Zoning designations for the
SDG&E property including the Power Plant site should be amended.
4. Part of the study may include preparing alternative land uses and a
"conceptual Master Plan" for the properties including the Encina Power Plant site and,
at this time, staff is authorized to solicit Requests for Qualifications (RFQs) from
consulting finns that are interested in contracting with the city to assist staff in preparing
said alternative uses for the Power Plant site.
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EXHIBIT 5
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5. Staff Is also directed to consider the repeal or amendments to Section
21.48.100, as appropriate, of the Carlsbad Municipal Code regarding Public Utility
exemptions from the non-conforming use provisions of the Zoning Ordinance.
PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City
Council of the City of Carlsbad on the 12th day of May , 1998,
by the following vote, to wit:
AYES: Council Members Lewis, Finnila, Nygaard
NOES: None
ABSENT: Council;0^ember Hall
CLAU
ATTEST:
ALETHA L. RAUTENKRANZ, City Clerk /
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EXHIBIT 5
EXHIBIT "A"
LOCATION MAP
SDG&E PROPERTIES
ROI
9
Amended Carlsbad Energy Center ProjectScott Donnell, Senior PlannerApril 22, 20141
Encina Power Station2
Overview•January 2014 settlement agreement•Seven recommended land use actions requiring Council action3
Repeal of Urgency Ordinance•Urgency Ordinance CS‐170 –adopted January 2012–Amended P‐U Zone4
Repeal of Urgency Ordinance•Introduction of proposed Ordinance CS‐250 would:–Repeal the urgency ordinance–Restore deleted text5
Specific Plan Update Requirement•Resolution 98‐145–Approved in 1998–Established comprehensive update requirement–Affects Encina Specific Plan 6
Encina Specific Plan7
Specific Plan Update Requirement•Approval of proposed Resolution 2014‐074 would:–Find the purpose of the update requirement fulfilled–Determine the update requirement no longer necessary8
Specific Plan Update Requirement•Other standards provide adequate regulation•Repeal of Encina Specific Plan is a future proposed action9
Redevelopment Land Use and Finding•South Carlsbad Coastal Redevelopment Area Plan•Extraordinary public purpose requirement10
Redevelopment Land Use and Finding•Approval of proposed Resolution 2014‐075 would:–Accept the transfer of land use plans and functions–Assume responsibility for land use enforcement–Find the Amended CECP land use compliant11
RecommendationThat the City Council introduce Ordinance No. CS‐250 repealing, in its entirety, Urgency Ordinance CS‐170.12
Recommendation (cont’d)That the City Council approve Resolution 2014‐074, finding the City Council Resolution 98‐145 requirement to comprehensively update Specific Plan 144 no longer necessary as the purpose of that requirement is fulfilled.13
Recommendation (cont’d)That the City Council approve Resolution 2014‐015:•Accepting the transfer of all land use plans and functions of the former Carlsbad Redevelopment Agency•Assuming responsibility and authority for enforcement of said land use plans and functions; and •Finding the Amended CECP complies with the land use policies of the South Carlsbad Coastal Redevelopment Area Plan.14