HomeMy WebLinkAboutCT 00-02; Calavera Hills II LLC; 2004-0000000; Reimbursement Agreement/ReleaseAGREEMENT FOR REIMBURSEMENT OF COSTS FOR THE CONSTRUCTION OF
PLANNED LOCAL DRAINAGE AREA FACILITIES BJA AND BJB
This Agreement for Reimbursement of Costs for the Construction of Planned Local
Drainage Area (“PLDA) Facilities BJA and BJB, dated as of 3UL\! 33 , 2004
(“Agreement“) is made at San Diego County, California, by and between the CITY OF
CARLSBAD, a municipal corporation of the State of California (“City”), and CALAVERA HILLS
II, LLC (“Developer“) a California Limited Liability Company.
RECITALS
A. Developer is developing certain real property commonly known as Calavera Hills
Phase II, (the “Property”), located in the City, more particularly described as Carlsbad Tract No.
00-02 (the “Project”), filed in the Office of the County Recorder of San Diego County on January
14,2003, as File No. 2003-0162081.
B. The Planning Commission of the City adopted Resolution No. 51 17 on January
2,2002, recommending approval of the Project.
C. The City Council of the City adopted Resolution No. 2002-016 on January 15,
2002 approving the Project.
D. The Project approvals require Developer to design and construct certain Master
Drainage Plan facilities to the satisfaction of the City identified as Detention Basin BJB and
Storm Drain BJA (each a “Drainage Improvement” and collectively, the “Drainage
Improvements”).
E. The Drainage Improvements are included within the list of the City’s Planned
Local Drainage Area (“PLDA”) improvements (Area “B) funded by the collection of PLDA fees.
F. The City’s PLDA fee program provides for the reimbursement and/or credit
against payment of the PLDA fee for developments that construct PLDA facilities.
G. Developer desires to receive and City desires to provide, consistent with
Chapter 15.08 of City Code, reimbursement and/or credit against payment of Developer’s PLDA
“B” fee for the cost to construct the Drainage Improvements.
H. The Developer’s cost to construct the Drainage Improvements exceeds the cost
of the Facilities BJA and BJB as estimated in the City’s Master Drainage and Storm Water
Quality Management Plan dated March 1994 (the “Master Drainage Plan”), plus the
adjustments provided for in Section 15.08.040(b) of the City Code (“Fee Adjustments”).
I. The City has obtained a grant of funds from the Federal Emergency
Management Agency (“FEMA Grant”) in the amount of five hundred and thirty nine thousand six
hundred and sixty three dollars ($539,663) for the construction and enlargement of Detention
Basin BJB to provide flood protection for the existing developments located downstream of
Detention Basin BJB.
J. The City is in the process of revising the Master Drainage Plan and the PLDA
fee program to, among other things, include the increased cost of Detention Basin BJB and to
account for the FEMA Grant money within the PLDA fee program.
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K. As a condition of the development of the Project, the Developer entered into an
agreement with the City dated December 3,2003, recorded in the San Diego County Recorders
Office as Document No. 2002-1096937 (“PLDA Fee Payment Agreement”), whereby the
Developer agrees to abide by any subsequent increase (or decrease) in the PLDA fees as may
be adopted by the City Council. By this reference, the PLDA Fee Payment Agreement is hereby
incorporated into this Agreement.
L. The City approved formation of Assessment District No. 2003-01 College
Boulevard and Cannon Road East (the “Assessment District”) on September 16, 2003 pursuant
to City Council Resolution No. 2003-244. The Assessment District was formed to finance the
construction of portions of College Boulevard and Cannon Road including appurtenant sewer,
water, recycled water, utility improvements and, certain storm drainage improvements including
the Drainage Improvements. Assessment District No. 2003-01 included provisions specifically
excluding the use of assessment district funds to pay the Developer for any costs to construct
PLDA facilities reimbursed from and/or credited against payment of PLDA fees.
M. The City and Developer entered into an agreement for acquisition, construction
and financing of improvements to Cannon Road East and College Boulevard and to Master
Drainage Plan facilities Basin BJB and Storm Drain BJA dated December 11, 2002 (“Acquisition
Agreement”).
N. Developer has entered into a subdivision improvement with the City dated
November 4, 2002 and a Grading and Erosion Control Agreement dated November 4, 2002
(collectively the “Secured Agreements”) and, posted security deposits with the City
guaranteeing the construction of certain improvements, including the Drainage Improvements.
0. Developer and City covenant and agree to abide by the terms and conditions of
the Acquisition Agreement and the Secured Agreements and, by this reference, each such
agreement is hereby incorporated into this Agreement.
P. The Developer and City desire to establish a method to fairly reimburse the
Developer for the construction of the Drainage Improvements using PLDA, Assessment District
and/or FEMA Grant funds (the “Reimbursable Drainage Improvement Work”).
NOW, THEREFORE, the City and Developer agree as follows:
I. Recitals. The Recitals above are true and correct and incorporated herein by
this reference.
2. Satisfaction of Obliqation. Developer’s agreement to perform the Reimbursable
Drainage Improvement Work, as set forth herein, and the actual construction
thereof, shall fully satisfy and constitute compliance with all requirements regarding
the Project solely with respect to the Reimbursable Drainage Improvement Work.
3. General Developer Obligations.
a. Developer shall cause the construction of the Reimbursable Drainage
Improvement Work, which work includes the construction of Storm Drain BJA
and Detention Basin BJB, as shown on City Drawing No. 390-9 dated
November 26, 2002 and City Drawing No. 390-9A dated October 28, 2002, both
drawings prepared by O’Day Consultants including any revisions thereto as are
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approved by the City (the “Plans”). The Plans are on file with the City
Engineering Department and are incorporated herein by this reference.
b. Developer shall cause the construction of the Reimbursable Drainage
Improvement Work in compliance with the Acquisition Agreement, Secured
Agreements and the City-approved plans and specifications, and other design
documentation, as referenced within the plans.
c. Developer hereby waives any and all potential constitutional or other legal
objections relating to the Drainage Improvements.
d. Developer shall observe and follow the requirements of the City’s Administrative
Procedures for Reimbursable Public Works Projects dated April 2, 2003,
incorporated herein by this reference, for bidding procedures, records retention,
compliance with California State prevailing wage requirements, audit
procedures and other administrative requirements in connection with the
construction of the Drainage Improvements.
e. Developer shall pay and/or receive credit against payment of PLDA fees for
Project in accordance with City Codes and the provisions of the PLDA Fee
Payment Agreement.
4. General Citv Oblinations.
a. City shall reimburse the Developer for Reimbursable Drainage Improvement
Work as described in Sections 5 and 6 below.
b. All reimbursements made by the City, pursuant to the terms of this Agreement,
shall be made only to Developer, unless otherwise directed, in writing by the
Developer, to make a reimbursement payment to another party.
5. Reimbursable Drainaqe Improvement Work.
a. The items of Reimbursable Drainage Improvement Work (“Reimbursable
Expenses”) shall consist of all costs of construction thereof and all incidental
costs of the construction of the Drainage Improvements eligible under City
Code, Assessment and/or the federal requirements for the FEMA Grant,
including the following:
i. Usual and customary design and engineering costs including civil
engineering, soils engineering, landscape architecture, survey and
construction staking and, plan check and inspection fees as they relate
to the Drainage Improvements only.
ii. Costs of acquisition for the inundation easements for Basin BJB,
including :
I. Appraisal and title insurance costs; and,
2. Costs of preparing acquisition plats.
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3. The appraised value or actual costs, whichever is less, to acquire
the off-site easement from the Carlsbad Unified School District;
and,
4. The appraised value or actual cost, whichever is less, to acquire
the inundation easement over the Robertson Ranch property,
which property is now under the ownership of Developer.
iii. Costs of environmental review, permitting and habitat mitigation
associated with the Drainage Improvements.
iv. An amount equal to 4.5% of the direct cost of construction of the
Drainage Improvements for the Developer’s overhead, construction
management and supervision, including on-site supervision.
v. An amount equal to 1.8% of the direct cost of construction of the
Drainage Improvements to reimburse the Developer for the allocable
portion of the premiums paid by Developer for blanket liability insurance
coverage.
b. The total estimated amount of the Reimbursable Drainage Improvement Work
is $2,930,393. Exhibit A, attached hereto and incorporated herein by reference,
sets forth the preliminary cost estimate for the Reimbursable Drainage
Improvement Work. The parties acknowledge that Exhibit A, which was
prepared by the City in conjunction with the Developer’s engineer, is for
illustrative purposes only and that all costs are subject to audit for eligibility for
payment in accordance with the procedures of Paragraph 5(a) above and
Section 6 below.
c. Any portion of the Reimbursable Drainage Improvement Work completed before
the effective date of this Agreement shall be included as a part of the
Reimbursable Drainage Improvement Work for reimbursement, subject to the
other provisions of this Agreement.
d. City’s reimbursement obligations hereunder shall be based upon the actual costs incurred by Developer in performing Reimbursable Drainage Improvement
Work. If however, the cumulative total of Reimbursable Expenses exceeds the
PLDA cost estimate plus the amount of costs eligible for FEMA Grant funds
(“Reimbursable Cost Overage”) then, prior to City reimbursement of the
Reimbursable Cost Overage, the PLDA fee program must be amended to
reflect the actual construction costs. The Developer may opt to include the
Reimbursable Cost Overage within the financing for Assessment District No.
2003-01, to the extent permitted by assessment district law, City Policy and the
Final Engineer’s Report for Assessment District No. 2003-01. If the Developer
opts to include all or a portion of the Reimbursement Cost Overage in the
financing for Assessment District No. 2003-01, then the amount of the
Reimbursement Cost Overage funded by Assessment District No. 2003-01 will
not be included in any subsequent revisions of the PLDA fee program and, the
Developer will not be eligible to receive reimbursement from PLDA fee funds for
any costs funded by Assessment District No. 2003-01.
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6. Audit of Reimbursable Expenses.
a. Developer may submit for reimbursement upon substantial completion of the
Reimbursable Drainage Improvement Work. Each such submittal shall be
considered a Reimbursement Request.
b. Reimbursement Requests will be processed and audited for City by a reputable
consulting engineer selected by City ("Auditing Engineer"). The costs of the
Auditing Engineer shall be paid directly by the City from PLDA fee funds and/or
Assessment District funds.
c. The Auditing Engineer shall review all contracts for Reimbursable Drainage Improvement Work and the payment records submitted in connection therewith, and shall within sixty (60) days after receipt thereof issue to City and Developer
a report either accepting Developer's submittal or specifying with particularity
any reimbursement items or amounts not approved. To the extent, the Auditing
Engineer does not approve a portion of any payment request, the undisputed
amounts shall be deemed approved and shall be reimbursed as provided
herein. Any reimbursement items or amounts not approved by the Auditing
Engineer may be further pursued by Developer using the dispute resolution
procedure of Paragraph 8 below.
7. Pavment of Reimbursable Expenses.
a. Payment of Reimbursable Expenses shall be made in accordance with the
following:
i. Payment of approved Reimbursable Expenses shall be made after first
deducting and crediting against Reimbursable Expenses all unpaid PLDA fee obligations for the Project, in effect at the time of
reimbursement and attributable to that portion of the Property within
PLDA "B". The total fee credit to be deducted from the Reimbursable
Expenses under the current PLDA fee structure is $628,417.57.
Pursuant to the provisions of the PLDA Fee Payment Agreement, The
Developer is obligated to pay any future increase, or receive a
credithefund upon revision of the PLDA fee program.
ii. Except as provided in Paragraph 5.d., the amount of reimbursement
from the PLDA fee program is limited to the lesser of the actual
construction cost for each Drainage Improvement or the estimated cost
of each Drainage Improvement, including any Fee Adjustments as
detailed in Exhibit "A. Exhibit B shows the adjusted PLDA cost estimate
for each Drainage Improvement together with the estimated cost to
construct each Drainage Improvement. After making the deductions
called for in Paragraph 7.a.i. above, the estimated reimbursement to the
Developer for the Reimbursable Drainage Improvement Work from the
PLDA fee revenue fund is $476,806.
iii. The amount of reimbursement to the Developer from the FEMA grant is
set at $539,663.
iv. Payment of the approved Reimbursable Expenses, pursuant to the
provisions of Paragraphs 7.a.i., ii. and iii, above, and Paragraph 7.a.vi.,
below, shall be made in cash or by check, within sixty (60) days after
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Auditing Engineer’s written determination on any such Reimbursement
Request (or determination pursuant to Paragraph 8 of this
Reimbursement Agreement, if applicable). The estimated amount of the
payment for Reimbursable Expenses from current PLDA fee program
and FEMA grant funds is $1,016,469, excluding any reimbursement for Reimbursable Cost Overage. The actual amount of payment for
Reimbursable Expenses shall be determined after completion of the
audit of Reimbursable Expenses and after making the deduction called
for in Paragraph 7.a.i., above.
v. The Reimbursable Cost Overage, as determined pursuant to Paragraph
5.d., above, is estimated at $1,244,700. Pursuant to assessment district law, City Policy and the Final Engineer’s Report for Assessment District No. 2003-01, the estimated amount of the Reimbursable Cost Overage
that may be included within the financing for Assessment District No.
2003-01 is $998,716. Reimbursement of this amount shall be made in
accordance with the terms and conditions as provided in the Acquisition Agreement. The remaining Reimbursable Cost Overage, estimated at
$286,790, shall be included in the proposed amendment to the PLDA
fee program and, any future reimbursement from the PLDA fee
revenues shall be made to the Developer as called for in Paragraph 5.d.,
above, and Paragraph 7.a.v., below. The timing for the payment of any
future reimbursement from the amended PLDA fee program for
Reimbursable Cost Overage shall be at the discretion of the City and
shall be determined after City approval of the amended PLDA fee program. Prior to payment of any future reimbursement from the
revenues generated from the amended PLDA fee program, the
Developer shall pay the difference in PLDA fee obligation to the City or
receive a refund from the City of the difference, as a propriate, if any, in
accordance with the PLDA Fee Payment Agreemen ti
vi. Reimbursement will be limited by the amount of funds available in the PLDA “B” fee fund accounts. Developer and City agree that the City’s
General Fund is not part of this Agreement, and shall not be obligated
under the terms of this Agreement nor shall it be available for
reimbursement purposes.
8. Disputes/Claims. If a dispute should arise regarding the performance or
interpretation of this Agreement, the following procedure shall be used to resolve any
question of fact or interpretation not informally resolved by the parties.
Such questions, if they become identified as a part of a dispute among persons
operating under the provisions of this Agreement shall be reduced to writing by the
principal of Developer or the Director. A copy of such documented dispute shall be forwarded to both parties involved along with recommended methods of resolution, which would be of benefit to both parties. The Director, or principal, upon receipt, shall reply to the letter, including a recommended method of resolution within ten (10) days. If the recommended resolution is unsatisfactory to the aggrieved party, a letter outlining the dispute shall be forwarded to the City Council for their resolution through the office of the City Manager. The City Council may, but is not obligated to resolve the dispute. If the City Council considers the dispute, and directs a solution, the action of the City Council shall be binding upon the parties involved, although nothing
in this procedure shall prohibit the parties from seeking remedies available to them at
law.
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9. Assinnment of Contract. The Developer shall not assign this contract or any part
thereof or any monies due hereunder without the prior written consent of the City.
IO. Notices. Unless otherwise specifically provided herein, all notices, demands or other
communications given hereunder shall be in writing and shall be deemed to have
been duly delivered upon personal delivery, or by Federal Express (orsimilar
reputable express delivery service), or by facsimile transmission with back-up copy
mailed the same day, or as of the second business day after mailing by United States
Certified Mail, return receipt requested, postage prepaid, address as shown below.
Notices required to be given to Developer shall be addressed as follows:
Calavera Hills II, LLC
Attn: Brian Millich
2727 Hoover Avenue
National City, CA 91 950
Telephone: (61 9) 336-31 38 Fax: (619) 336-3596
Notices to City shall be delivered to the following:
CITY OF CARLSBAD
Attention: Public Works Director
1635 Faraday Avenue
Carlsbad, CA 92008
Telephone: (760) 602-2730
FAX: (760) 602-8562
Each party shall notify the other immediately of any changes of address that would
require any notice delivered hereunder to be directed to another address.
11. Transfer bv Developer. The obligations and benefits of this Agreement shall not be
transferred upon sale of the Property.
12. Counterparts. This Agreement may be executed in any number of counterparts,
each of which when so executed and delivered shall be deemed to be an original and
all of which counterparts taken together shall constitute one and the same
instrument.
13. Governinn Law and Venue. This Agreement shall be interpreted and enforced
under the laws of the State of California, and venue shall reside in North San Diego
County, California.
14. Complete Agreement. This Agreement contains the entire agreement between the
parties with respect to the subject matter contained herein, and supersedes all
negotiations, discussions, and prior drafts with respect to this subject matter.
15. Amendment. This Agreement may be amended only by a written instrument
executed by both the City and Developer.
16. Term. This Agreement shall be effective as of the date first above written, and shall
terminate on January 30, 2014 or sooner if all of the Drainage Improvements have
been completed and full reimbursementlcredits have been given in accordance with
the provisions of this Agreement.
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17. No Third Partv Beneficiaries. This Agreement shall not be deemed to confer any
rights upon any individual, or entity, which is not a party hereto, and the parties hereto
expressly disclaim any such third-party benefit.
18. Severabilitv. The invalidity or unenforceability of any provision of this Agreement, as
determined by a court of competent jurisdiction, shall in no way affect the validity or
enforceability of any other provision hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first above written.
Calavera Hills II, LLC, A California limited
liability company
By: McMillin Companies, LLC, A Delaware
limited liability company
By: (sign here) /
112_ 6
(print name and ftle of signatory) P
City Clerk
APPROVED AS TO FORM:
RONALD RdBALL, City Attorney
BY:
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State of California 1
before me, , Notary
personally known to me or w-- proved to me on the basis of satisfdctory evidence to be the
person whose name is subscribed to the within instrument and acknowledged to me that he
executed the same in his authorized capacity, and that by his signature on the instrument the
person, or the entity upon behalf of which the person acted, executed the instrument.
WITNESS my han
State of California )
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County of )
On
Public, personally appeared Claude Lewis
personally known to me or proved to me on the
the person whose name is subscribed to the within instrume
executed the Sam
person, or the entity upon behalf ofwhich the person acted, e
WITNESS my hand and official seal.
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