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HomeMy WebLinkAbout09 AGREEMENT W/TIC & CITY OF IRVINE 04-15-08AGENDA REPORT MEETING DATE: APRIL 15, 2008 TO: WILLIAM A. HUSTON, CITY MANAGER FROM: PUBLIC WORKS DEPARTMENT/ENGINEERING DIVISION SUBJECT: APPROVAL OF AGREEMENT REGARDING FUNDING OF STREET IMPROVEMENTS BY AND AMONG THE CITY OF IRVINE, THE IRVINE COMPANY LLC, AND THE CITY OF TUSTIN FOR CONSTRUCTION OF TUSTIN RANCH ROAD BETWEEN WALNUT AVENUE AND EDINGER AVENUE (CIP NO. 7100) SUMMARY The proposed Agreement by and among the City of Irvine, The Irvine Company LLC, and the City of Tustin outlines each agency's responsibilities for the construction of Tustin Ranch Road between Walnut Avenue and Edinger Avenue (CIP No. 7100). RECOMMENDATION It is recommended that the City Council approve the Agreement Regarding Funding of Street Improvements by and among the City of Irvine, The Irvine Company, and the City of Tustin for construction of Tustin Ranch Road between Walnut Avenue and Edinger Avenue (CIP No. 7100) and authorize the Mayor and City Clerk to execute the document on behalf of the City. FISCAL IMPACT The Reimbursement Agreement requires The Irvine Company LLC (TIC) to pay in advance the estimated cost of construction ($4,500,000) of Tustin Ranch Road between Walnut Avenue and Edinger Avenue (CIP No. 7100). TIC has thirty (30) days from the effective date of the Agreement to pay City the $4,500,000. DISCUSSION The Tustin Ranch Road Extension Project proposes to extend Tustin Ranch Road, a six (6) lane Major Arterial, from the existing terminus at Walnut Avenue to Valencia Avenue on the Tustin Legacy site. The length of the extension is approximately 0.8 miles and will provide three (3) travel lanes in each direction. A four (4) lane loop road will connect this extension with Edinger Avenue. Tustin Legacy Community Partners (TLCP) is now the lead entity for completion of the project, including design and construction of the improvements. Approval of Agreement Regarding Funding of Street Improvements by and among the City of Irvine, The Irvine Company LLC, and the City of Tustin for Construction of Tustin Ranch Road between Walnut Avenue and Edinger Avenue (CIP No. 7100) April 15, 2008 Page 2 TIC's predecessor in interest, The Irvine Company, a Michigan corporation, has previously agreed, in connection with conditions imposed by Tustin on the development of TIC's property, to fund the construction of Tustin Ranch Road between Walnut Avenue and Edinger Avenue. The specific conditions and agreement regarding such obligation are contained in (1) Resolution No. 1382 of the Tustin Planning Commission, dated December 10, 1973; (2) Ordinance No. 611 of the Tustin City Council, dated January 21, 1974; (3) Resolution No. 74-15 of the Tustin City Council, dated March 4, 1974; and (4) that certain Amended and Restated Jamboree Road Improvement Agreement between the City of Tustin and The Irvine Company, dated June 5, 1984. Approval of the subject Agreement is required in order for the City to be reimbursed by TIC for construction of Tustin Ranch Road between Walnut Avenue and Edinger Avenue. The Agreement is now ready for City Council approval. The City Attorney has reviewed the Agreement and has signed it "Approved as to Form". Additionally, both The Irvine Company LLC and the City of Irvine have approved and signed the Agreement. Tim D. Serlet Director of Public Works/City Engineer Dana R. Kasdan Engineering Services Manager Attachments: Agreement Regarding Funding of Street Improvements TDS: DRK: ccg: Approval of Funding Agmt-TIC for TRR.doc AGREEMENT REGARDING FUNDING OF STREET IMPROVEMENTS by and among CITY OF IRVINE and CITY OF TUSTIN and THE IRVINE COMPANY LLC 30209-0079/360803.7 I 1 / 16/07 AGREEMENT REGARDING FUNDING OF STREET IMPROVEMENTS THIS AGREEMENT REGARDING FUNDING OF STREET IMPROVEMENTS (the "Agreement") is entered into as of , 200_ (the "Effective Date") by and among the CITY OF IRVINE, a municipal corporation organized and existing under and by virtue of the Constitution and laws of the State of California and its Charter ("Irvine"), the CITY OF TUSTIN, a municipal corporation organized and existing under and by virtue of the Constitution and laws of the State of California ("Tustin"), and THE IRVINE COMPANY LLC, a Delaware limited liability company ("Company"), and relates to the funding by Company and Assessment Districts No. 97-16 and 97-17 (the "Districts") of certain street and appurtenant utility improvements located within the portion of Tustin Ranch Road between Walnut Avenue and Edinger (collectively, the "Street Improvements"). The Street Improvements will be owned by Tustin and are more particularly described on ExhibitA attached hereto. Irvine, Tustin and Company are sometimes referred to herein individually as a "Party" and collectively as the "Parties." RECITALS: A. Pursuant to the provisions of the Municipal Improvement Act of 1913 (Division 12 of the California Streets and Highways Code) and of Chapter 5 of Division 7 of Title 2 of the City of Irvine Municipal Code (collectively, the "Act"), Irvine has previously formed the Districts and issued bonds (the "Bonds") that have been secured by a special assessment lien on land within the Districts for the purpose of financing the cost of various infrastructure improvements (including, but not limited to, the Street Improvements) determined to be of benefit to the property within the Districts. B. The Act permits the financing of the Street Improvements with proceeds derived from the sale of the Bonds, but requires that Irvine enter into an agreement with Tustin before Irvine orders the expenditure of Assessment District funding for the construction of the Street Improvements. C. Company's predecessor in interest, The Irvine Company, a Michigan corporation, has previously agreed, in connection with conditions imposed by Tustin on the development of Company's property, to fund a portion of the Street Improvements. The specific conditions and agreement regarding such obligation are contained in (i) Resolution No. 1382 of the Tustin Planning Commission, dated December 10, 1973; (ii) Ordinance No. 611 of the Tustin City Council, dated January 21, 1974; (iii) Resolution No. 74-15 of the Tustin City Council, dated March 4, 1974; and (iv) that certain Amended and Restated Jamboree Road Improvement Agreement between the City of Tustin and The [rvine Company, dated June 5, 1984. D. The Parties wish to enter into this Agreement to satisfy the requirements of the Act as well as their previous commitments to provide for the construction, acquisition and funding of the Street Improvements. AGREEMENT NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the parties hereto agree as follows: 1. Recitals. Each of the above recitals is incorporated herein and is true and correct. 30209-0079/360803.7 I I / 16/07 2. Tustin's Consent and Responsibility for Funding. Tustin consents to the inclusion of the Street Improvements in the work to be financed through contributions from the Districts and Company. Tustin acknowledges full responsibility for causing the construction of the Street Improvements as provided in Section 5 below and that, other than for the monetary contributions from Company and the Districts as provided in Section 3 below, all funding for completion of the Street Improvements will be provided by, or caused to be provided by, Tustin. 3. Improvement Costs Funded b~Company and Districts. The Parties have agreed that Four Million Five Hundred Thousand Dollars ($4,500,000.00) of the cost of the Street Improvements (the "Improvement Costs") are to be funded by Company and the Districts. Company has agreed to pay for Two Million Dollars ($2,000,000.00) of the Improvement Costs (the "Company Share"), and lvine has agreed to cause the Districts to fund Two Million Five Hundred Thousand Dollars ($2,500,000.00) of the Improvement Costs (the "Irvine Share") upon completion of the Street Improvements. Company and Irvine each agree to pay their respective shares of the Improvement Costs as follows: (a) Company shall pay the entire amount of the Improvement Costs (that is, $4,500,000.00) to Tustin within thirty (30) days of the Effective Date of this Agreement; (b) within thirty (30) days of receipt of evidence that the Street Improvements have been completed and accepted by Tustin, Irvine shall reimburse Company for the Irvine Share of the Improvement Costs. 4. Use of District Bond Proceeds. The Bonds have previously been sold by Irvine. After review by Irvine's staff of the issues regarding funding of a portion of the Improvement Costs with funding provided by the Districts, Irvine has determined that it shall fund the Irvine Share from the proceeds of the Bonds previously sold by the Districts. Under no circumstances shall Irvine be responsible for funding more than the Irvine Share of the Street Improvements. 5. Construction and Ownership of Facilities. Tustin has caused the completion of the conceptual design of the plans and specifications for the Street Improvements. Subject to (a) Tustin's approval of the final design of the plans and specifications for the Street Improvements to be prepared by the master developer of the Tustin Legacy project, and (b) Tustin's receipt of the full amount of the Improvement Costs from Company pursuant to Section 3 above, Tustin shall construct or cause the construction of the Street Improvements. Upon completion of construction of the Street Improvements in accordance with the final plans and specifications approved by Tustin, Tustin shall accept the Street Improvements into its public street system. 6. Amendment. This Agreement may be amended at any time but only in writing signed by each Party hereto. 7. Notices. Any notice, payment or instrument required or permitted by this Agreement to be given or delivered to any party shall be deemed to have been received when personally delivered or seventy-two hours following deposit of the same in any United States Post Office in California, registered or certified mail, postage prepaid, addressed as follows: Irvine: City of Irvine One Civic Center Plaza Irvine, CA 92606-5208 Attn: Manager of Fiscal Services 30209-0079/360803.7 I I / 16/07 Tustin: City of Tustin 300 Centennial Way Tustin, CA 92708 Attn: Director of Finance Company: The Irvine Company LLC 550 Newport Center Drive Newport Beach, CA 92660 Attn: Vice President, Public Finance with a copy to: The Irvine Company LLC 550 Newport Center Drive Newport Beach, CA 92660 Attn: Vice President and General Counsel, Office Properties Each Party may change its address for delivery of notice by delivering written notice of such change of address to the other Parties. 8. Severability. [f any part of this Agreement is held to be illegal or unenforceable by a court of competent jurisdiction, the remainder of this Agreement shall be given effect to the fullest extent reasonably possible. 9. Governing Law and Venue. This Agreement and any dispute arising hereunder shall be governed by and interpreted in accordance with the laws of the State of California. In the event of any legal action to enforce or interpret this Agreement, the sole and exclusive venue shall be a court of competent jurisdiction located in Orange County, California, and the Parties agree to and do hereby submit to the jurisdiction of such court, notwithstanding Code of Civil Procedure Section 394. Furthermore, the Parties specifically agree to waive any and all rights to request that an action be transferred for trial to another county. 10. Waiver. Failure by a Party to insist upon the strict performance of any of the provisions of this Agreement by the other parties hereto, or the failure by a Party to exercise its rights upon the default of another Party, shall not constitute a waiver of such Party's right to insist and demand strict compliance by such other Parties with the terms of this Agreement thereafter. 11. No Third Party Beneficiaries. No person or entity other than the Districts shall be deemed to be a third party beneficiary hereof, and nothing in this Agreement (either express or implied) is intended to confer upon any person or entity, other than Tustin, Irvine, the Districts and Company (and their respective successors and assigns), any rights, remedies, obligations or liabilities under or by reason of this Agreement. 12. Singular and Plural; Gender. As used herein, the singular of any word includes the plural, and terms in the masculine gender shall include the feminine. 13. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which shall constitute but one instrument. 14. Time of Essence. Time is of the essence with respect to each matter herein in which time is a factor. 30209-0079/360803.7 I I /16/07 3 15. Entire Agreement. This Agreement contains the entire agreement among the Parties with respect to the matters provided for herein and supersedes all prior agreements and negotiations between and among the .Parties with respect to the subject matter of this Agreement. IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date set forth above. THE IRVINE COMPANY LLC, a Delaware limited liability company By: Name: Ronald J. Keith- Executive Vice President Title: Commercial Property Development BY: Name: Vincent P. Hayes Title: Assistant Secretary CITY OF IRVINE, a California municipal corporation By: Its: MAYOR ATTEST: City Clerk APPROVED AS TO FORM: RUTAN & TUCKER, LLP By: Name: Title: 30209-0079/360803.7 1 I / 16/07 4 CITY OF TUSTIN, a California municipal corporation By: Its: ATTEST: City Clerk APPROVED S TO FORM: By: 1~r lrE' ~ f}~r Name: CY" ' Title: 30209-0079/360803.7 I I / 16/07 EXHIBIT A DESCRIPTION OF STREET IMPROVEMENTS 1. Improve the full width of Tustin Ranch Road between Walnut Avenue and the southerly boundary of Tract No. 8763 at the Edinger Road interchange with paving, curbs, gutters, sidewalks and bicycle trails (if shown on City of Tustin improvement plans), street lights, raised medians with landscaping and irrigation systems, and street trees. 2. Improve the slope of the Tustin Ranch Road embankment located northerly of Edinger Road at such interchange with landscaping and irrigation systems. 30209-0079/360803.7 11 / 16/07