CITY OF ELK GROVE CITY COUNCIL STAFF REPORT

Transcription

1 CITY OF ELK GROVE CITY COUNCIL STAFF REPORT AGENDA ITEM NO AGENDA TITLE: Adopt resolution authorizing the Mayor to execute a Reimbursement Agreement for privately constructed public facilities with Taylor Morrison of California, LLC. MEETING DATE: March 9, 2016 PREPARED BY: DEPARTMENT HEAD: Mimi Ly, Finance Analyst Brad Koehn, Director of Finance and Administrative Services RECOMMENDED ACTION: Staff recommends the City Council adopt a resolution authorizing the Mayor to execute a Reimbursement Agreement (the Agreement ) with Taylor Morrison of California, LLC (the Developer ) for privately constructed public facilities in the Elk Grove Roadway Fee Program (the Program ) and amending the Fiscal Year Budget to reflect the expenses authorized in the Agreement. BACKGROUND INFORMATION: In 2003, the City Council adopted Elk Grove Municipal Code (EGMC) Chapter (EGMC), which created a program of development impact fees for roadway facilities, referred to as the Elk Grove Roadway Fee Program. In 2009, the City amended EGMC Chapter thereby updating the Program and the corresponding Nexus study that identified eligible facilities and facilities costs. Under the terms of the Program, if developers advance construction of eligible facilities, the developers could seek reimbursement by either fee credits against future fees or cash reimbursement of the cost of the improvement, subject to certain limitations defined in the Program. 1

2 Elk Grove City Council March 9, 2016 Page 2 of 3 The Developer plans to construct a four-way traffic signal at Lotz Parkway and Auto City Drive that is eligible for reimbursement through the Program. Consistent with EGMC Chapter 16.95, the Developer has requested reimbursement by way of fee credits and/or cash reimbursement from the Program for these facilities. Staff has prepared the Reimbursement Agreement for Privately Constructed Facilities Included in the Elk Grove Roadway Fee Program, included as Exhibit A to Attachment 1 to this report. Exhibit B to the Agreement sets forth the costs of improvements that are the subject of the Agreement. All improvements and amounts have been identified in the updated 2014 Nexus Study and adjusted based on the Caltrans Construction Cost Index (the Index ) as identified in EGMC Chapter The Agreement provides and outlines terms for use of certain fee credits. Once approved by the City, credits are the property of the Developer and are fully transferable. The Developer may apply fee credits up to 60% of the value of future roadway impact fees, on a dollar for dollar basis, until all credits are exhausted. Credits will be granted to the developer at the time of each building permit, based on the then current roadway impact fee. To the extent that such fee credits do not fully reimburse the Developer and/or the Developer is unable to exhaust its fee credit balance on development projects within the City, the Developer will be in line for a cash reimbursement from the Roadway Fee Program behind other developers with similar agreements. This split between credits and cash reimbursement replicates similar agreements previously adopted by Council. Before release of credits or cash payments by the City to the Developer, certain conditions identified in the reimbursement agreement have to be met. They include: 1. The City has, in its sole discretion, the right to determine whether there are sufficient funds to make the payment; and 2. The Developer has completed, and the City has deemed adequate, the facilities for which the reimbursement has been requested; and 3. The Developer is not in default on any other obligations to the City. 2

3 Elk Grove City Council March 9, 2016 Page 3 of 3 The Agreement does not affect warranties otherwise required of facilities constructed and dedicated to the City. FISCAL IMPACT: The Agreement commits only the Roadway Fee Program Fund, a restricted revenue source that is intended exclusively for financing Program infrastructure, such as the facilities outlined within the Agreement. The Agreement has provisions that require the Developer to provide substantial documentation detailing that work was completed per the City s reimbursement policies. The Agreement provides the City full authority in determining when sufficient funds are available to reimburse the Developer, thereby providing assurance that financing for critical projects will not be delayed by this Agreement. The expense related to the reimbursement was not identified in the Fiscal Year 2016 budget. Therefore, a budget amendment in the amount of $337,100 is required to authorize the expense and to establish the fee credits. ATTACHMENTS: 1. Resolution Approving the Agreement and Amending the Budget A. Exhibit A: RC Reimbursement Agreement for Privately Constructed Public Facilities Included in the Elk Grove Roadway Fee Program 3

4 ATTACHMENT 1 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ELK GROVE AUTHORIZING THE MAYOR TO EXECUTE REIMBURSEMENT AGREEMENT RC WITH TAYLOR MORRISON OF CALIFORNIA, LLC, FOR PRIVATELY CONSTRUCTED PUBLIC FACILITIES INCLUDED IN THE ELK GROVE ROADWAY FEE PROGRAM IN SUBSTANTIALLY THE FORM PRESENTED, AND AMENDING THE FISCAL YEAR BUDGET TO REFLECT THE EXPENSES AUTHORIZED IN THE AGREEMENT WHEREAS, Elk Grove Municipal Code Section provides for reimbursement to developers for the private construction of any facilities designated in the Roadway Fee Program subject to entering into a reimbursement agreement with the City of Elk Grove; and WHEREAS, Taylor Morrison of California, LLC is constructing a traffic signal in the City on Lotz Parkway and Auto City Drive, which is included in the Roadway Fee Program; and WHEREAS, a budget amendment is necessary to reflect the expenses authorized in the agreement. Account Current Budget Adjustment Revised Budget $1,533,014 $337,100 $1,870,114 Action Establish Roadway Fee Credit NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Elk Grove hereby authorizes the Mayor to execute Reimbursement Agreement RC for reimbursement by way of credits against future fees and/or cash reimbursement from the Roadway Fee Program with Taylor Morrison of California, LLC. as presented in substantially the form presented as Exhibit A; and BE IT FURTHER RESOLVED that the City Council of the City of Elk Grove hereby authorizes an amendment to the FY Budget from the Elk Grove Roadway Fee Program to establish the eligible fee credits. PASSED AND ADOPTED by the City Council of the City of Elk Grove this 9 th day of March GARY DAVIS, MAYOR of the CITY OF ELK GROVE ATTEST: APPROVED AS TO FORM: JASON LINDGREN, CITY CLERK JONATHAN P. HOBBS, CITY ATTORNEY 4

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