HomeMy WebLinkAbout01-ATTACHMENT HATTACHMENT H
Ordinance No. 1441
(Development Agreement)
ORDINANCE NO. 1441
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
TUSTIN, APPROVING DEVELOPMENT AGREEMENT (DA)
2013 -003 BETWEEN THE CITY OF TUSTIN AND THE
STANDARD PACIFIC CORP. TO FACILITATE THE
DEVELOPMENT OF 375 HOMES WITHIN NEIGHBORHOOD
G OF THE MCAS TUSTIN SPECIFIC PLAN
The City Council of the City of Tustin does hereby ordain as follows:
SECTION 1. The City Council finds and determines as follows:
A. That proper application has been submitted by Standard Pacific Corp. for the
development of 375 residential units, a focal park and other neighborhood
amenities on approximately 78 acre site currently owned by the City of Tustin
within Planning Areas 15 of the MCAS Tustin Specific plan.
B. That MCAS Tustin Specific Plan Section 4.2.9 requires all private development
at MCAS Tustin to obtain a Development Agreement in accordance with
Section 65864 et seq. of the Government Code and Sections 9600 to 9619 of
the Tustin City Code. In compliance with Tustin City Code Section 9611, the
Tustin Planning Commission must make a recommendation on the proposed
Development Agreement to the City Council.
C. That a public hearing was duly called, noticed, and held on said application
on December 10, 2013, by the Planning Commission. The Planning
Commission adopted Resolution No. 4239 recommending that the City
Council adopt Ordinance No. 1441.
D. That a public hearing was duly called, noticed, and held on said application
on January 21, 2014, by the City Council and the City Council continued the
item to February 4, 2014.
E. That a public hearing was duly called, noticed, and held on said application
on February 4, 2014, by the City Council.
F. On January 16, 2001, the City of Tustin certified the Program Final
Environmental Impact Statement/Environmental Impact Report (FEIS /EIR) for
the reuse and disposal of MCAS Tustin. On December 6, 2004, the City
Council adopted Resolution No. 04 -76 approving a Supplement to the
FEIS /EIR for the extension of Tustin Ranch Road between Walnut Avenue and
the future alignment of Valencia North Loop Road. On April 3, 2006, the City
Council adopted Resolution No. 06 -43 approving an Addendum to the
FEIS /EIR. And, on May, 13, 2013, the City Council adopted Resolution No.
13 -32 approving a second Addendum to the FEIS /EIR. The FEIS /EIR along
with its Addenda and Supplement is a program EIR under the California
Ordinance No. 1441
DA 2013 -003
Page 2
Environmental Quality Act (CEQA). The FEIS /EIR, Addenda and Supplement
considered the potential environmental impacts associated with development
on the former Marine Corps Air Station, Tustin.
An Environmental Checklist has been prepared and concluded that these
actions do not result in any new significant environmental impacts or a
substantial increase in the severity of any previously identified significant
impacts in the FEIS /EIR. Moreover, no new information of substantial
importance has surfaced since certification of the FEIS /EIR.
G. That the Development Agreement can be supported by the following findings:
1. The project is consistent with the objectives, policies, general land uses
and programs specified in the General Plan and the MCAS Tustin
Specific Plan in that residential uses are permitted uses within Planning
Area 15 of Neighborhood G.
2. The project is compatible with the uses authorized in the district in which
the real property is located (Planning Areas 15) in that similar and
compatible uses are envisioned within the close proximity of the project
site
3. The project is in conformity with the public necessity, public
convenience, general welfare, and good land use practices in that the
project would provide 375 various styles of new housing units for new
and existing Tustin residents thereby providing additional option of.
housing types to the City's housing stock.
4. The project will not be detrimental to the health, safety, and general
welfare. The project will comply with the MCAS Tustin Specific Plan,
Tustin City Code, and other regulations to ensure that the project will not
be detrimental in any way.
5. The project will not adversely affect the orderly development of property
in that the proposed project is orderly, well designed, and equipped with
necessary infrastructure and amenities to support existing and future
residents and businesses in Tustin Legacy.
6. The project will have a positive fiscal impact on the City in that the
provisions of the proposed Development Agreement and conditions of
approval will ensure that the project will have a positive fiscal impact on
the City.
SECTION 2. The City Council hereby approves Development Agreement 2013 -003
attached hereto as Exhibit A and subject to final approval of the City
Attorney.
Ordinance No. 1441
DA 2013 -003
Page 3
SECTION 3. Severability. If any section, subsection, sentence, clause, phrase, or
portion of this ordinance is for any reason held to be invalid or
unconstitutional by the decision of any court of competent jurisdiction,
such decision shall not affect the validity of the remaining portions of
this ordinance. The City Council of the City of Tustin hereby declares
that it would have adopted this ordinance and each section, subsection,
sentence, clause, phrase, or portion thereof irrespective of the fact that
any one or more sections, subsections, sentences, clauses, phrases, or
portions be declared invalid or unconstitutional.
PASSED AND ADOPTED, at a regular meeting of the City Council for the City of
Tustin on this 4th day of February, 2014.
ELWYN A. MURRAY
Mayor
JEFFREY C. PARKER
City Clerk
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss.
CITY OF TUSTIN )
ORDINANCE NO. 1441
JEFFREY C. PARKER, City Clerk and ex- officio Clerk of the City Council of the City
of Tustin, California, does hereby certify that the whole number of the members of the
City Council of the City of Tustin is 5; that the above and foregoing Ordinance No.
1441 was duly and regularly introduced at a regular meeting of the Tustin City
Council, held on the 4th day of February, 2014 and was given its second reading,
passed, and adopted at a regular meeting of the City Council held on the 18th day of
February, 2014 by the following vote:
COUNCILMEMBER AYES:
COUNCILMEMBER NOES:
COUNCILMEMBER ABSTAINED:
COUNCILMEMBER ABSENT:
JEFFREY C. PARKER
City Clerk
Published:
CITY OF TUSTIN OFFICIAL BUSINESS
REQUEST DOCUMENT BE RECORDED
AND BE EXEMPT FROM PAYMENT OF
A RECORDING FEE PER
GOVERNMENT CODE 6103 AND 27383
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
City of Tustin
300 Centennial Way
Tustin, California 92780
Attn: City Clerk
Space Above This Line Reservedfor Recorder’s Use Only
TUSTIN LEGACY DEVELOPMENT AGREEMENT
THIS TUSTIN LEGACY DEVELOPMENT AGREEMENT
(“Agreement”) is
CITY OF
entered into effective as of the Effective Date (as defined below) by and between the
TUSTIN, STANDARD PACIFIC
a California municipal corporation (“City”), and
CORPORATION
, a Delaware Corporation (“Developer”). Cityand Developerare collectively
referred to herein asthe “Parties” and individually as a “Party”.
RECITALS
A.To strengthen the public planning process, encourage private participation in
comprehensive planning, and reduce the economic risk of development, the Legislature of the
State of California adopted the “Development Agreement Statute,” Sections 65864, et seq.,of
the Government Code. The Development Agreement Statute authorizes Cityto enter into an
agreement with any person having a legal or equitable interest in real property and to provide for
development of such property and to establish certain development rights therein. In addition,
MCAS Tustin Specific Plan Section 4.2.9 states: “prior to issuance of any permits or approval of
any entitlements within the Specific Plan area, all private development shall first obtain a
Development Agreement in accordance with Section 65864 et seq. of the Government Code and
Sections 9600 to 9619 of the Tustin City Code.” Pursuant to the authorization set forth in the
Development Agreement Statute, Cityhas enacted procedures for entering into development
agreements which are contained in Tustin City Code Sections 9600 to 9619.
B.Cityand Developerintend, concurrently with the execution of this Agreement, to
enter into the Tustin Legacy Disposition and Development Agreement for Disposition Parcels 1B
and 6A, as the samemay be amended from time to time(the “DDA”) pursuant to which City
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shall agree to sell, and Developershall agree to buy and develop, certain real property, all as
more specifically set forth in the DDA.
C.Pursuant to the DDA, Developerhas an equitable and/orlegal interest in the
Property (as defined below) in that it has the contractual right to purchase the Property from City
for development of the Project.
D.Pursuant to Government Code Section 65864, the Legislature has found and
determined that:
“(a)The lack of certainty in the approval of development projects can result in
a waste of resources, escalate the cost of housing and other development to the consumer, and
discourage investment in and commitment to comprehensive planning which would make
maximum efficient utilization of resources at the least economic cost to the public.
(b)Assurance to the applicant for a development project that upon approval of
the project, the applicant may proceed with the project in accordance with existing policies, rules
and regulations, and subject to conditions of approval, will strengthen the public planning
process, encourage private participation in comprehensive planning, and reduce the economic
costs of development.
(c)The lack of public facilities, including,but not limited to, streets,
sewerage, transportation, drinking water, school, and utility facilities, is a serious impediment to
the development of new housing. Whenever possible, applicants and local governments may
include provisions in agreements whereby applicants are reimbursed over time for financing
public facilities.”
In accordance with the legislative findings set forth in Government Code Section 65864,
Citywishes to attain certain public objectives that will be furthered by this Agreement. This
Agreement will provide for the orderly implementation of the General Plan of the City(“General
Plan”), and the phased development and completion of the Project in accordance with the DDA
and the Specific Plan(as defined below). This Agreement will further a comprehensive planning
objective contained within the City’s General Plan, which is:
“To promote an economically balanced community with complimentary and
buffered land uses to include industrial, commercial, professional, multi-family and single-
family development.”
E.The DDA, the Specific Plan and the development under the DDA and the Specific
Plan require a substantial early investment of money and planning and design effort by
Developer. Without the protection provided by this Agreement, uncertainty that the Project may
be completed in its entirety could result in a waste of public resources, escalate the cost of public
improvements, and discourage Developer’s participation in those certain public improvements
specified in the DDA and the Specific Plan. Developer’s participation in the implementation of
the DDA and the Specific Plan will result in a number of public benefits. These benefits require
the cooperation and participation of Cityand Developerand could not be secured without mutual
cooperation in and commitment to the comprehensive planning effort that has resulted in the
DDA and the Specific Plan.
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F.Developerwishes to avoid certain development risks and uncertainties that would,
in the absence of this Agreement, deter and discourage Developerfrom making a commitment to
implement the DDA and the Specific Plan. These are as follows:
1.It is generally the law in California that, absent extraordinary
circumstances or the approval of a vesting subdivision map, an owner of the land does not obtain
a vested right to improve land until the issuance of a building permit for the improvements and
commencement of substantial construction pursuant to that permit. The result is a disincentive
for landowners to invest monies in the early completion of major infrastructure and other public
improvements as part of any project or in early comprehensive planning and design studies.
2.Development under the DDA and the Specific Plan requires a substantial
early investment of money and planning and design effort by Developer. Uncertainty about
City’s land use policies, rules and regulations could result in a waste of private resources,
escalate the cost of certain public improvements, and escalate costs of proposed housing and
other uses.
G.The following assurances are of vital concern to Developerto offset or remove
the disincentives and uncertainties set forth in Paragraph F above:
1.Assurance to Developerthat, in return for Developer’scommitment to the
development of the Property that is contained in the DDA,any approved entitlements, and the
Specific Plan, Citywill in turn remain committed to the Existing Entitlement Approvals;
2.Assurances to Developerthat as Developerbecomes obligated for the
costs of designing and constructing the public and private improvements included in the DDA
and the Specific Plan, and makes dedications, Developerwill become entitled to rely upon the
Vested Rights in the development of the Property; and
3.Assurances to Developerthat in City’s administration of the Existing
Entitlement Approvals, Developerwill be allowed, consistent with the DDA and the Specific
Plan, to develop the housing types and intensities identified in the DDA and the Specific Plan.
These assurances provide for cooperation and participation of Cityand Developerand could not
be secured without mutual cooperation in and commitment to the comprehensive planning effort
that has resulted in the DDA and the Specific Plan.
H.The Development Agreement Statuteauthorizeslocal agencies to enter into
binding development agreements with persons having legal or equitable interests in real property
for the development of such property. Citywishes to enter into a development agreement with
Developerto secure the Public Benefits (as defined below) and additional consideration
described in this Agreement, and Developerwishes to enter into a development agreement with
Cityto avoid the development risks and uncertainties and to obtain the assurances described
above.
I.This Agreement is intended to be, and shall be construed as, a development
agreement within the meaning of the Development Agreement Statute. This Agreement is
intended to augment and further the purposes and intent of the Parties in the implementation of
the DDA and the Specific Plan. This Agreement, as a device for the implementation of the
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Existing Entitlement Approvals and the Specific Plan, will eliminate uncertainty in planning for
and secure the orderly development of the Project, ensure a desirable and functional community
environment, provide effective and efficient development of public facilities, infrastructure, and
services appropriate for the development of the Project, assure attainment of the maximum
effective utilization of resources within the City, and provide other significant public benefits to
Cityand its residents by otherwise achieving the goals and purposes of the Development
Agreement Statute. In exchange for these benefits to City,Developerdesires to receive the
assurance that it may proceed with development of the Project in accordance with the terms and
conditions of this Agreement and the Applicable Rules, all as more particularly set forth herein.
J.Cityhas determined that this Agreement and the Project are consistent with the
GeneralPlan and the Specific Planand that thisAgreement complies with the findings
established by Tustin City Code Section 9611 in that the Agreement:
1.Is consistent with the objectives, policies, general land uses and programs
specified in the General Plan andthe Specific Plan.
2.Is compatible with the uses authorized in the district in which the real
property is located (Specific Plan Planning Area 15).Note: the proposed for sale residential
project complies with the uses authorized by the Specific Plan.
3.Is in conformity with the public necessity, public convenience, general
welfare, and good land use practices. Note: the Project will enhance housingopportunities
within the City and support economic development and activity in the vicinity of the Project.
4.Will not be detrimental to the health, safety, and general welfare.Note:
compliance with the Specific Plan, Tustin City Code, and other regulations will ensure that the
Project will not be detrimental in any way.
5.Will not adversely affect the orderly development of property. Note: the
proposed Project is orderly and well designed.
6.Will have a positive fiscal impact on the City.Note: the provisions of the
DDA will ensure that the Project will have a positive fiscal impact on the City.
K.On _________________, 2013, the Planning Commission held a public hearing
on this Agreement, made certainfindings and determinations with respect thereto, and
__________
recommended to the City Council of Citythat this Agreement be approved. On
, 2014
, the City Council held a public hearing on this Agreement, considered the
recommendations of the Planning Commission, and adopted Ordinance No.______, approving
this Agreement and authorizing its execution.
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AGREEMENT
NOW, THEREFORE, in consideration of the above recitals, which are incorporated
herein by this reference, and for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the Parties agree as follows:
1.DEFINITIONS AND EXHIBITS.
1.1.Definitions. The following terms when used in this Agreement shall be defined as
follows:
Any capitalized word or term used in this Agreement shall have the definition or meaning
ascribed to such word or term as provided in the DDA, unless the word or term is expressly
provided in this Section 1.1 of this Agreement, in which event such word or term shall have the
definition or meaning as provided herein.
1.1.1“Action” is defined in Section 8.10.
1.1.2“AD/CFD” is defined in Section 3.1.1.
1.1.3“Administrative Amendment” is defined in Section 2.6.2.
1.1.4“Agreement” is defined in the introductory paragraph.
1.1.5“Applicable Rules” means (a) the Existing Land Use Regulations of the
City, (b) the Future Rules that are not in conflict (as defined in Section 3.6.2) with the Vested
Rights; (c) the Future Rules made applicable to the Project and/or the Property pursuantto
Section 3.10; (d) the Existing Entitlement Approvals, and (e) the Subsequent Entitlement
Approvals to which the Project and/or the Property or development and use thereof are made
subject to pursuant to the terms of this Agreement.
1.1.6“Applications” is defined in Section 3.11.2.
1.1.7“Certificate” is defined in Section 4.4.
1.1.8“CFD Default” shall meana failure of Developer to timely vote, or a vote
by Developer against the formation of the AD/CFD and/or the TUSD CFD which complies with
the requirements of Section 3.1.1 and as a result thereof, one or both of the AD/CFD or the
TUSD CFD fails to be formed.
1.1.9“CFD Liquidated Damages” shall meanthe CFD Liquidated Damages due
pursuant to the DDA in the event of a CFD Default that is not cured within the time period set
forth therein.
1.1.10“City” is defined in the introductory paragraph.
1.1.11“Costs” is defined in Section 8.10.
1.1.12“Damages” is defined in Section 5.3.
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1.1.13“DDA” is defined in the Recital B.
1.1.14“Decision” is defined in Section 8.10.
1.1.15“Defaulting Party” is defined in Section 5.1.
1.1.16“Developer” is defined in the introductory paragraph and includes any
Successors In Interest of Developer.
1.1.17“Development Agreement Statute” is defined in Recital A.
1.1.18“Development Permits” means all ministerial permits, certificates and
approvals which may be required by City or other governmental authority for the development
and construction of the improvements for the Project, in each case in accordance with this
Agreement, the DDA, the Applicable Rules and any required environmental mitigation,
including without limitation any engineering permits, grading permits, foundation permits,
construction permits and building permits.
1.1.19“Effective Date” means the date the City’s ordinance approving this
Agreement becomes effective and, if not otherwise specified in this Agreement, shall mean the
date upon which this Agreement is recorded by Cityin the Official Records.
1.1.20“EIR” means the Final Environmental Impact Statement/Final
Environmental Impact Report for the Disposal and Reuse of MCAS Tustin (Final EIS/EIR) and
Mitigation Monitoring and Reporting Program for the Final EIS/EIR adopted by the City on
January 16, 2001as subsequentlymodified by Supplement to the Final EIR/EIS and Addendato
the Final EIS/EIR approved by the City.
1.1.21“Entitlement Approvals” means all discretionary land use approvals and
entitlements including, without limitation, Specific Plan amendments, Tentative and Final tract
maps, parcel maps, the Concept Plans and Design Review approvals as may be applicable for
proposed specific uses(s)in connection with development of the Property and all conditions of
approval legally required by City as a condition to subdivision of the Property, development of
the Property, and construction of the improvements in accordance with this Agreement.
Entitlement Approvals shall be comprised of the Existing Entitlement Approvals and the
Subsequent Entitlement Approvals.
1.1.22“Existing Entitlement Approvals” means all Entitlement Approvals
approved or issued prior to the Effective Date and including the following which are a matter of
public record on the Effective Date: (a) Development Agreement (DA) 2013-003, (b) Concept
Plan (CP) 2013-002, (c) Design Review (DR) 2013-06, (d) Specific Plan Amendment (SP) 2013-
002 and (e) Tentative Tract Map (TTM) 17507, required for the proposed development of 375
single family detached residential homes at the Property.
1.1.23“Existing Land Use Regulations” means the Land Use Regulations in
effect on the Effective Date, including without limitation, the General Plan, the City Zoning
Code, the Specific Plan, and all other ordinances, resolutions, rules, and regulations of the City
governing development and use of the Property in effect as of the Effective Date.
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1.1.24“First Party” is defined in Section 8.11.3.
1.1.25“Future Rules” is defined in Section 3.6.2.
1.1.26“Force Majeure Delay” is defined in Section 8.11.1as limited by Section
8.11.2.
1.1.27“General Plan” is defined in Recital D.
1.1.28“Initial Channel Condition” is defined in Section 3.17.1.
1.1.29“Land Use Regulations” means all laws, statutes, ordinances, resolutions,
codes, orders, rules, regulations and official policies of City governing the development and use
of land, including, without limitation, the permitted uses of the Property, the density or intensity
of use, subdivision requirements, timing and phasing of development, the maximum height and
size of proposed buildings, and the provisions for reservation or dedication of land for public
purposes.
1.1.30“Lump Sum Payment” is defined in Section 3.13.3.
1.1.31“New Development Area” is defined in Section 3.17.1.
1.1.32“Non-Defaulting Party” is defined in Section 5.1.
1.1.33“Party” and “Parties” aredefined in the introductory paragraph.
1.1.34“Prevailing Party” is defined in Section 8.10.
1.1.35“Project” means the development of the Property contemplated by the
Entitlement Approvals as such Entitlement Approvals may be further defined, enhanced or
modified pursuant to the provisions of this Agreement.
1.1.36“Project Fair Share Contribution” is defined in Section 3.13.3.
1.1.37“Property” means the real property describedon Exhibit “A” and shown
on Exhibit “B” to this Agreement.
1.1.38“Public Benefits” means those public benefits to be provided by the
Developer and the Project as described in Section 3.1 of this Agreement that comprise
enforceable additional consideration to Cityfor this Agreement.
1.1.39“Reservation of Authority” means the rights and authority excepted from
the assurances and rights provided to Developer under this Agreement and reserved to City under
Section 3.10.
1.1.40“Second Party” is defined in Section 8.11.3.
1.1.41“Specific Plan” means the City’s MCAS Tustin Specific Plan/Reuse Plan,
as amended, and as the same maybe further amended from time to time.
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1.1.42“State” means the State of California.
1.1.43“Subsequent Entitlement Approvals” means Entitlement Approvals, if
any, approved byCitysubsequent to the Effective Date in connection with development of the
Property.
1.1.44“Successors In Interest” means any person having a legal or equitable
interest in the whole of the Property, or any portion thereof.
1.1.45“Tax A” is defined in Section 3.1.1(a).
1.1.46“Tax B” is defined in Section 3.1.1(a).
1.1.47“TUSD CFD” shall have the meaning set forth in Section 3.1.1(b).
1.1.48“Tustin City Code” means the municipal code of the City of Tustin.
1.1.49“Vested Right” means the rights granted to Developer pursuant to this
Agreement upon its acquisition of the Property to develop the Property in accordance with, and
subject to the terms and conditions of this Agreement, the Existing Entitlement Approvals and
any Subsequent Entitlement Approvals approved by Cityand made applicable to the Property
pursuant to the terms of this Agreement.
1.2.Exhibits. The following documents are attached to, and by this reference made a
part of, this Agreement:
Exhibit “A” –Legal Description of the Property.
Exhibit “B” –Map showing Property and its location.
Exhibit “C” –“Public Benefit Improvements”
Exhibit “D” –Base Year Tax Burden Schedule
2.GENERAL PROVISIONS.
2.1.Binding Effect of Agreement. The Property is hereby made subject to this
Agreement. Development of the Property is hereby authorized and shall be carried out only in
accordance with the terms of this Agreement.
2.2.Interestsin Property.Cityand Developeragree that Developer’s right to acquire
the Property pursuant to the DDA creates a sufficient legal and/or equitable interest in order to
enter into this Agreement. If Developerfails to acquire any portion of the Property, then this
Agreement shall automatically no longer be effective as to such portion of the Property
concurrently with the date upon which Developer’s rights to acquire such portion of the Property
expire.
2.3.Term. The term of this Agreement shall commence on the Effective Date and
shall continue for a term of seven(7) years unless this term is terminated, modified, or extended
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by circumstances set forth in this Agreement or by mutual written consent of the Parties.
Notwithstanding the foregoing, the term of this Agreement shall be automatically extended
during the term of any Force Majeure Delay, provided that the maximum term of this Agreement
as extended by Force Majeure Delay shall be eight(8) years.
2.4.Assignment.
2.4.1Assignment and Notification. The rights, interests and obligations
conveyed and provided herein to Developerbenefit and are appurtenant to the Property.
Developerhas the right to sell, assign and transfer any and all of its rights and interests and to
delegate any and all of its duties and obligations hereunder; provided, however, that such rights
and interests may not be transferred or assigned except in strict compliance with the provisions
of Section 2.2 of the DDA, which are incorporated herein by this reference as though fully set
forth in this Agreement, and the following conditions:
(a)Developersecures the written consent of Cityif required pursuant
to Section 2.2 of the DDA;
(b)Said rights and interests may be transferred or assigned only as an
incident of the transfer or assignment of the portion of the Property to which they relate,
including any transfer or assignment pursuant to a foreclosure of a Mortgage or a deed in lieu of
a foreclosure;
(c)Prior to assignment or transfer, if required pursuant to this Section
2.4 and Section 2.2 of the DDA, Developershall notify Cityin writing of such assignment or
transfer, the portions of the Property to which the assignment or transfer will be appurtenant, and
the name and address (for purposes of notices hereunder) of the transferee or assignee, together
with the corresponding number of dwelling units and/or non-residential entitlements which are
proposed to be included within such transfer and Developerand the assignee or transferee shall
notify Citywhether the assignee or transferee will assume any of Developer’s obligations under
this Agreement and which of Developer’s obligations will be assumed; and
(d)The assignee or transferee shall have entered into an Assignment
and Assumption Agreement if required by the DDA.
Any attempt to assign or transfer any right or interest in this Agreement except in strict
compliance with this Section 2.4 shall be null and void and of no force and effect.
2.4.2Subject to Terms of Agreement. Following an assignment or transfer of
any of the rights and interests of Developerset forth in this Agreement in accordance with
Section 2.4.1, the assignee’s exercise, use, and enjoyment of the Property shall be subject to the
terms of this Agreement to the same extent as if the assignee or transferee were Developer.
2.4.3Release of DeveloperUpon Transfer. Notwithstanding the assignment or
transfer of portions or all of the Property or rights or interests under this Agreement, Developer
shall continue to be obligated under this Agreement unless released or partially released by City
with respect to Developer’s obligations and the other duties and obligations of Developerunder
this Agreement, pursuant to this paragraph, which release or partial release shall apply only with
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respect to obligations of Developerfollowing the effective date of the assignment and shall be
provided by Cityupon the full satisfaction by Developerof the following conditions:
(a)Developeris not then in default under this Agreement;
(b)Cityhas consented to the assignment or transfer if required under
Section 2.4.1;
(c)The assignment or transfer is not a Transfer to an Affiliate or a
Builder Transferee or other Transfer or Transfer of Control for which the DDA expressly
provides that Developershall not be released from its obligations under the DDA;
(d)The assignmentor transfer is an assignment of all Developer’s
interest in the Property, the DDA and this Agreement;
(e)An assignee or transferee has assumed all duties and obligations as
to which Developeris requesting to be releasedpursuant to an Assignment and Assumption
Agreement approved by City; and
(f)The assignee or transferee is financially able to assume the
obligations proposed for assignment and has demonstrated to the reasonable satisfaction of City
that adequate resources have been committed to the full performance of such obligations.
2.5.Property to Continue to be Subject to This Agreement. In the absence of specific
written agreement by City, pursuant to which Cityexpressly releases the Developerunder the
applicable provisions of the DDA or this Agreement, noTransfer shall constitute a release of
Developerfrom any of its obligations under this Agreement and the Developershall retain such
obligations and remain jointly and severally liable for such obligations. Cityshall cooperate
with Developer, at no cost to City, in executing in recordable form any document that Cityhas
approved to confirm the termination of this Agreement as to any such portion of the Property.
Notwithstanding the foregoing, the burdens of this Agreement shall terminate as to any Lot or
Home conveyed to an End User, including, any individual residential unit that is sold or leased
after issuance of a certificate of occupancy, and such Lots and Homesshall be released from and
shall no longer be subject to this Agreement (without the execution or recordation of any further
document or the taking of any further action).
2.6.Amendment or Cancellation of Agreement.
2.6.1Generally.This Agreement may be amended or cancelled in whole or in
part only in the manner provided for in Government Code Sections65865.1 or 65868 and Tustin
City Code Section 9615. This provision shall not limit any remedy of City or Developer as
provided by this Agreement. Either Party or Successor in Interest may propose an amendment to
or cancellation, in whole or in part, of this Agreement. Any amendment or cancellation shall be
by mutual consent of the Parties or their Successors in Interest except as provided otherwise in
this Agreement, in Government Code Section 65865.1, or in the Tustin City Code.
2.6.2Administrative Amendments.Any amendment to this Agreement which
doesnot relate to the Term of this Agreement, permitted uses of the Project, provisions for the
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reservation or dedication of land or the conditions, terms, restrictions and requirements relating
to Subsequent Entitlement Approvals of City, revisions to Public Benefits (other than to the time
for performance of such Public Benefits) or monetary exactions of Developer, shall be
considered an “Administrative Amendment”. The City Manager or assignee is authorized to
execute Administrative Amendments on behalf of City and no action by the City Council (e.g.
noticed public hearing) shall be required before the Parties may enter into an Administrative
Amendment. However, if in the judgment of the City Manageror assignee that a noticed public
hearing on a proposed Administrative Amendment would be required, City’s Planning
Commission shall conduct a noticed public hearing to consider whether the Administrative
Amendment should be approved or denied, and shall make a recommendation to the City
Council on the matter. The City Council shall conduct a noticed public hearing to consider the
request and the Planning Commission’s recommendation on the matter. At the conclusion of the
public hearing, the City Councilmay approve, deny, or conditionally approve the amendment.
2.6.3Consent to Amendments. In the case of amendments affecting portions of
the Property, only the consent of the owner of such portionof the Propertyshall be required so
long as the amendment does not diminish the rights appurtenant to or increase the burdens upon
any other portion of the Property. AnyFuture Rule applicable pursuant to this Agreement and
any amendment of City Land Use Regulations including to the General Plan, applicable Specific
Plan or City’s zoning ordinance, shall not require amendment of thisAgreement. Instead, any
such amendment shall be deemed to be incorporated into this Agreement at the time that such
amendment is approved by the appropriate City decision maker, so long as such amendment is
consistent with this Agreement.
2.6.4Termination. This Agreement shall be deemed terminated and of no
further effect upon the occurrence of any of the following events:
(a)Expiration of the stated term of this Agreement as set forth in
Section 2.3;
(b)Entry of a final court judgment not subject to further appeal setting
aside, voiding or annulling the adoption of the Cityordinance approving this Agreement;
(c)The adoption of a referendum measure overriding or repealing the
Cityordinance approvingthis Agreement;
(d)Completion of the Project and the Public Benefits in accordance
with the terms of this Agreement, the DDA, Entitlement Approvals and the Applicable Rules,
including issuance of all required occupancy permits and acceptance by Cityor applicable public
agency of all required public improvements and dedications, and Cityissuance of a DDA
Certificate of Compliance;
(e)Due to termination by City in accordance with Section 4.3 or
Article 5;or
(f)Upon mutual written agreement of Cityand Developer.
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In addition, Cityshall have the right, but not the obligation, to terminate this Agreement
as to the portion of the Property reacquired by it pursuant to the Right of Purchase or the Right of
Reversion under the DDA.Termination of this Agreement shall not constitute termination of
any other Entitlement Approvals for the Property. Upon the termination of this Agreement, no
Party shall have any further right or obligation hereunder except with respect to any obligation to
have been performed prior to suchtermination or with respect to any default in the performance
of the provisions of this Agreement which has occurred prior to such termination or with respect
to any obligations which are specifically set forth as surviving this Agreement.
2.7.Notices, Demands and Communications between the Parties. All notices,
demands, consents, requests and other communications required or permitted to be given under
this Agreement shall be in writing and shall be deemed conclusively to have been duly given
(a)when hand delivered to the other Party; (b) three (3) Business Daysafter such notice has been
sent by United States mail via certified mail, return receipt requested, postage prepaid, and
addressed to the other Party as set forth below; or (c) the next Business Dayafter such notice has
been deposited with a national overnight delivery service reasonably approved by the Parties
(Federal Express, United Parcel Service and U.S. Postal Service are deemed approved by the
Parties), postage prepaid, addressed to the Partyto whom notice is being sent as set forth with
nextBusiness-Daydelivery guaranteed, provided that the sending Party receives a confirmation
of delivery from the delivery service provider. Unless otherwise provided in writing, all notices
hereunder shall be addressed as follows:
If to City:City of Tustin
Tustin City Hall
300Centennial Way
Tustin, CA 92780
Attention: City Manager
and Attention: Director of Community Development
With a copy to:City Attorney, City of Tustin
Woodruff Spradlin & Smart
701 S. Parker Street, Suite 8000
Orange, CA 92868-4760
Attention: David E. Kendig, Esq.
If to Developer:Standard Pacific Homes
c/o Michael C. Battaglia
15360 Barranca Parkway
Irvine, CA 92618
With a copy to:Rutan & Tucker, LLP
th
611 Anton Boulevard, 14Floor
Costa Mesa, CA 92626
Attn: John A. Ramirez
Any Party may by written notice to the other Party in the manner specified in this
Agreement change the address to which notices to such Party shall be delivered.
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3.DEVELOPMENT OF THE PROPERTY.
3.1.Public Benefits. This Agreement provides assurances that the Project identified
below will be achieved and developed in accordance with the Applicable Rules and this
Agreement, and subject to City’sReservation of Authority. The Parties believe that such orderly
development of the Project will provide the benefits to the City and additional regional public
benefits, including without limitation: new housing in immediate adjacency to employment,
increased tax revenues, installation of on-site and off-site improvements, and creation and
retention of jobs. In additionDeveloperwill provide the following additionalPublic Benefits
which constitute specific additional consideration for this Agreement for the benefit of City:
3.1.1CommunityFacilities District Formation. Developer and its Successor
Owners shall pay the following amounts to Citythrough imposition of an assessment district or
community facilities district with respect to the Propertyand the Improvements (the “AD/CFD”).
Cityshall have the right to establish the AD/CFD in its sole discretion.
(a)The AD/CFD will have two components, as follows:
(i) Special Tax “A” (“Tax A”) the proceeds of which may be used by City
for any lawful purpose; and
(ii) Special Tax “B” (“Tax B”), the proceeds of which shall be used by
Cityto fund a portion of Cityessential services, including police and fire
protection, ambulance and paramedic services, recreation programs and
services, street sweeping, traffic signal maintenance and the maintenance
of City-owned parks, parkways and open spaces, lighting, flood control
and storm drain services and other City services and facilities at Tustin
Legacy. The term of Tax B imposed upon the Propertyand the
Improvements shall be perpetual and shall not be time limited in any
manner unless determined by Cityin its sole discretion.
(b)Attached hereto asExhibit “D”is a Base Year Tax Burden
Schedule which divides the Homes to be constructed on the Development Parcels into six classes
based upon the square footage of each Home, together with the maximum tax amount which may
be imposed upon each Home within each class for Tax B, and the aggregate tax amount for each
Home for Tax A and a CFD or other assessment districtfor the Property formed by the Tustin
Unified School District(“TUSD CFD”) combined. If issued, the TUSD CFDis anticipated to
have an average unit cost ofapproximately $1516 per unit.Notwithstanding anything to the
contrary set forth in this Section 3.1, the annual property tax burden on each Home for Tax B and
on each Home for Tax A and the TUSD CFD combined, shall not exceed the amounts shown on
the Tax Burden Schedule for the applicable tax. Such taxes may thereafter be adjusted upward at
two percent (2%) per year as further described in the rate and method of apportionment.Nothing
in this Agreement shall preclude each of the City and TUSD from creating or issuing one or
more community facility districts or assessment districts with respect to the Development Parcels
for the purposes enumerated in this Section 3.1.1provided that the total aggregate tax amount for
all such districts does not exceed the amounts described in this Section 3.1.1.
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(c)At the sole discretion of City, the AD/CFD may be structured such
that assessments shall be due and payable with respect to the Propertywithout consideration for
whether or not Homes have been Completed thereon (i.e., such that all Lots shall be assessed as
improved or developed property); provided however, the AD/CFD assessment on unimproved
land or undeveloped portions of the Property shall be at an undeveloped property assessment rate
of Zero Dollars until the Initial Channel Condition has occurred.
(d)Developer agrees that it shall affirmatively support the formation
of each of the AD/CFD and the TUSD CFD, provided that each is proposed consistent with the
requirements of this Section 3.1.1.Developer further specificallyagrees that it shall timely take
all actions requested by City and TUSD in order to support formation of each of the AD/CFD
and TUSD CFD meeting the requirements of this Section3.1.1, at no material out-of-pocket cost
or expense to Developer.
(e)Citywill provide Developer with the opportunity to review and
provide input on all documents and budgets relating to the formation of the AD/CFD (including
any funding and acquisition agreement and the rate and method of allocating Tax A and Tax B)
at least thirty (30) days prior to the date on which the formation documents are expected to be
submitted for the agenda package for the first public hearing related to the formation of the
AD/CFD.
(f)The foregoing Tax A and Tax B shall be imposed by the City in its
Governmental Capacity as an additional Public Benefit madeapplicable to the Property and the
Improvements thereon.The agreement of Developer to imposition of the AD/CFD on the terms
set forth above and the payment of such proceeds to the City constitutes additional and material
consideration to the City under this Agreement. In addition to the requirements in this
Agreement, the establishment of the CFD and assessments imposed thereby and the proceeds of
any bonds issued in connection therewith shall be payable to the City pursuant to the DDA.
Nothing herein shall restrict the right of the City to exercise its remedies under this Agreement or
the DDA if Developer fails to either (A) timely comply with its obligations with respect to the
AD/CFD or the TUSD CFD or (B) to pay the applicable CFD Liquidated Damages whendue.
(g)Developer will not oppose a determination by the City to form the
AD/CFD,includinga determination to subjectall or any portionof the Propertyand
Improvements thereon to such assessment,provided that the City, the AD/CFD and such
assessments comply with clauses (a), (b), (c)and(e).Developer will not oppose a determination
by Tustin Unified School District to form the TUSD CFD, includinga determination to subject
all or any portion of the Property andthe Improvements thereon to such assessment,provided
that the TUSD CFDcomplieswith clause (b)above.
(h)There shall be no tax or other financial burden imposed on the
Propertyor the Improvements thereon on account of the AD/CFD or any similar taxing authority
such as a School Facility Improvement District formed by Cityor any agency or instrumentality
of Cityor Controlled by City, other than Tax A and Tax B, and Tax A and Tax B shall be in lieu
of any other assessments, special taxes, fees or charges that may otherwise be charged on
account of the types of services covered thereby. Notwithstanding the foregoing sentence, City
shall not be prohibited by the terms of this Agreementfrom subjecting the Propertyand
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Improvements thereon to any increase in ad valorem real property tax pursuant to a City of
Tustin-wide election, provided that nothing herein shall be construed to constitute a waiver by
Developer of its rightor ability to dispute or oppose passage of a City of Tustin-wide bond, the
proposed formation of any special district or taxing authority in connection therewith, or the
imposition of any such tax, or its right to dispute any portion of the Property’ assessed value.
(i)In the event of a CFD Defaultwhich becomes a Material Default
under the DDA (or if the DDA is terminated, which becomes a material default under this
Agreement), Developer shall be obligated under the DDA to pay to the City the CFD Liquidated
Damages. If (a) the Developer does not for any reason pay such CFD Liquidated Damages when
dueor (b) if the DDA has then terminated, the City shall have the right, in addition to any other
remedies it may have under the DDA or this Agreement, to exercise the remedies described in
Section 3.1.4 until such time as either (a) the CFD Default is cured or (b) if the DDA is then in
effect, the CFD Liquidated Damages due under the DDA are paid.
3.1.2Developer shall pay the Project Fair Share Contribution to the Cityas and
when described in Section 3.13.3.
3.1.3Developer shall complete the Public BenefitImprovements listed on
Exhibit “C”within the time periods set forth therein.
3.1.4Notwithstanding anything to the contrary in this Agreement, if any
payment under this Section3.1is not made or any obligation requiring performance is not
performed by Developer, the City may withhold further issuance of building permits and other
approvals, including final maps, for the Project until such time as Developer has made the
required paymentor undertaken the required performance.
3.2.DeveloperObjectives. In accordance with the legislative findings set forth in
Government Code Section 65864, the Developerwishes to obtain reasonable assurances that the
Project may be developed in accordance with the Applicable Rules and Existing Entitlement
Approvals and with the terms of this Agreement and subject to City’s Reservation of Authority.
To the extent of Project development, and as provided by Section 3.5.2, Developeranticipates
making capital expenditures or causing capital expenditures to be made in reliance upon the
DDA and this Agreement. In the absence of this Agreement, Developerwould have no
assurance that it can complete the Project for the uses and to the density and intensity of
development set forth in this Agreement and the Existing Entitlement Approvals. This
Agreement, therefore, is necessary to assure Developerthat the Project will not be (1) reduced or
otherwise modified in density, intensity or use from what is set forth in the Existing Entitlement
Approvals, (2) subjected to new rules, regulations, ordinances or official policies or plans except
forFuture Rules made applicable pursuant tothe terms of this Agreement.
3.3.Mutual Objectives. Development of the Project in accordance with this
Development Agreement will provide for the orderly development of the Property in accordance
with the objectives set forth in the General Plan. Moreover, a development agreement for the
Project will eliminate uncertainty in planning for and securing orderly development of the
Property, assure installation of necessary improvements, assure attainment of maximum efficient
resource utilization within the Cityat the least economic cost to its citizens and otherwise
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achieve the goals and purposes established by Government Code Section 65864. Additionally,
although development of the Project in accordance with this Agreement will restrain the City’s
land use or other relevant police powers, this Agreement provides Citywith sufficient reserved
powers during the term hereof to remain responsible and accountable to its residents. In
exchange for these and other benefits to City, the Developerwill receive assurance that the
Project may be developed during the term of this Agreement in accordance with the Applicable
Rules, Entitlement Approvals and Reservation of Authority, subject to the terms and conditions
of this Agreement.
3.4.Applicability of the Agreement.This Agreement does not: (a)grant density or
intensity in excess of that otherwise established in the Existing Entitlement Approvals;
(b)eliminate future discretionary actions relating to the Project that are either required by the
Applicable Rules or requested by Developer pursuant to applications initiated and submitted by
Developer after the Effective Date; (c)guarantee that Developer will receive any profits from the
Project; (d)amend the DDA, the Specific Plan or the General Plan;(e) except as specifically set
forth in Section 3.6.2 and 3.10, protect the Developer, the Project or the Property from the
applicability of any Future Rules to the extent imposed pursuant to City’s Reservation of
Authority or, if not so imposed, not in conflict (as defined inSection 3.6.2) with Existing Land
Use Regulations or (f) protect the Developer, the Project or the Property from the applicability of
any increases in development fees or processing fees.
3.5.Agreementand Assurance on the Part of the Developer. In consideration for City
entering into this Agreement, and as an inducement for Cityto obligate itself to carry out the
covenants and conditions set forth in this Agreement, and in order to effectuate the premises,
purposes and intentions set forth inthis Agreement, Developerhereby agrees as follows:
3.5.1ProjectDevelopment.Developeragrees that it will use commercially
reasonable efforts, in accordance with its own business judgment and taking into account market
conditions and economic considerations, to undertake any development of the Project in
accordance with the terms and conditions of the DDA, this Agreement and the Existing
Entitlement Approvals.
3.5.2Additional Obligations of Developeras Consideration for this Agreement.
In addition to the obligations identified in Section 3.1, the development assurances provided by
this Agreement and the resulting construction of the Project will result in the following:
(a)Construct a 375-unit single family detached residential complex at
Disposition Package Sites 1B and 6A, Tustin Legacy, consistent with this Agreement, the
Applicable Rules, the Entitlement Approvalsand theDDA, including without limitation in
accordance with the schedule of performance set forth in the DDA.
(b)Construct all Improvements identified in the DDA in accordance
with the schedule of performance set forth in the DDA.
(c)Complete all Public BenefitImprovementsidentified on Exhibit
“C” in accordance with the schedule of performance set forth in the DDA and this Agreement.
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(d)Comply with the DDA, the Applicable Rules and Entitlement
Approvals, state and federal law, all mitigation measures, including measures imposed pursuant
to CEQA, allDevelopment Permits and all conditions of approvalassociated with the foregoing.
(e)Developeracknowledges that Cityhas elected to fund certain
portions of the Tustin Legacy BackboneInfrastructure Program through imposition of a
landscape and lighting district, master maintenance association, assessment district, or any other
method or means determined by Citynecessary for funding of the maintenance of the public
right-of-way, landscape easements, public parks or of the various municipal services and
operating expenses associated with Tustin Legacy.
(f)Pay all required development related fees, including but not limited
to any required Tustin Legacy Backbone Infrastructure Program Fees pursuant to the terms and
conditions set forth in the DDAand this Agreement.
3.6.Agreement and Assurances on the Part of City. In consideration for Developer
entering into this Agreement, and as an inducement for Developerto obligate itself to carry out
the covenants and conditions set forth in this Agreement, and in order to effectuate the purpose
of this Agreement, Cityhereby agrees as follows:
3.6.1Applicable Regulations; Vested Right to Develop. To the maximum
extent permitted by law, Developerhas the vested right for the term of this Agreement to
develop the Project subject to the terms and conditions of the DDA, this Agreement, the
Applicable Rules, state and federal law, and the Existing Entitlement Approvals and any
Subsequent Entitlement Approvals approved by City, in each case subject to City’s Reservation
of Authority. Other than as expressly set forth herein, during the Term of this Agreement, the
terms and conditions of development applicable to the Property, including but not limited to the
permitted uses of the Property, the density and intensity of use, maximum height and size of
proposed buildings, the design, improvement and construction standards and specifications
applicable to the development of the Property, including any changes authorized pursuant to
Section 3.6.2, and the provisions for the reservation and dedication of land as needed for public
purposes pursuant to Governmental Requirements, shall be those set forth in the DDA, the
Applicable Rules, andthe Entitlement Approvals. In connection therewith and subject to the
terms of this Agreement including the Reservationof Authority, Developershall have the Vested
Rights to carry out and develop the Property in accordance with the Applicable Rules andthe
Entitlement Approvals and the provisions of this Agreement.
3.6.2Changes Authorized by City. To the extent any changes in the Existing
Land Use Regulations, or any provisions offutureGeneral Plans, Specific Plans, Zoning
Ordinances or other rules, regulations, ordinances or policies of City (whether adopted by means
of ordinance, initiative, referenda, resolution, policy, order, moratorium, or other means, adopted
by the City Council, Planning Commission, or any other board, commission, agency, committee,
or department of City, or any officer or employee thereof) following the Effective Date
(collectively, “Future Rules”) are not in conflict with the Vested Rights, such Future Rules shall
be applicable to the Project. For purposes of this Section3.6.2,the word “conflict” means Future
Rules that would(a) frustrate in a more than insignificant way the intent or purpose of the
Applicable Rulesin relation to the Project; (b) materially increase the cost of performance of, or
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preclude compliance with, any provision of the Vested Right; (c)delay in a more than
insignificant way development of the Project; (d) limit or restrict the availability of public
utilities, services, infrastructure of facilities (for example, but not by way of limitation, water
rights, water connection or sewage capacity rights, sewer connections, etc.) to the Project, or (e)
impose limits or controls in the rate, timing, phasing or sequencing of development of the
Project.
Notwithstanding the foregoing, a Future Rule that conflictswith the Applicable Rules
shall nonetheless apply to the Property if, and only if one of the following apply: (i)it is
consented to in writing by Developer; (ii)it is determined by City and evidenced through
findings adopted by the City Council that the change or provision is reasonably required in order
to prevent a condition dangerous to the public health or safety as set forth in Section3.10.3
below; (iii)required by changes in State or Federal law as set forth in Section3.10.2below;
(iv)it consists of revisions to, or new building regulations permitted by Section3.10.4; or (v)it is
otherwise expressly permitted by this Agreement.
3.6.3Availability of Public Services. To the maximum extent permitted by law
and consistent with its authority, Cityshall use commercially reasonable efforts assist Developer
in reserving such capacity for sewer and water services as may be necessary to serve the Project,
at no cost or expense to City.
3.6.4Allocation of Development Rights Under Specific Plan.City hereby
acknowledges that it has allocated to the Property and reserved for development of the Project a
total of approximately 375 residentialunits from the total Specific Plan Planning Area 15
authorization of 1,214 residentialunits; provided that the total residentialunits allocated to the
Propertyshall be equal to the number of Lots on a final tract map creating residential parcels
approved by CityandDeveloper and Developer shall only be entitled to develop residentialunits
equal to the number of Lots shown on the Final Map. Unless otherwise agreed by Cityin its sole
discretion, Cityshall retain the excess development rights remaining after deducting the number
of residentialunitsallocated to the Propertyfrom the Specific Plan Planning Area 15
authorization of 1,214 residentialunits.The residential units allocated to the Propertyshall be
equal to the number of Lots on the Final MapandDeveloper shall only be entitled to develop
residential units equal to the number of Lots shown on the Final Map. Except to the extent any
of such rights were conveyed by Cityto third parties prior to the Effective Date, Cityshall retain
all residential units and all development rights associated with Specific Plan Planning Area 15
above the number ofLots shown on the Final Map andsuch residential units and development
rights shall be freely transferable by Citythroughout Tustin Legacy.
3.7.Effect of Agreement on Land Use Regulations. Except as otherwise provided
under the terms of this Agreement including the Reservationof Authority (and notwithstanding
any future action of Cityor its citizens, whether by ordinance, resolution, initiative or otherwise),
the rules, regulations, and official policies governing the Project, including, without limitation,
the permitted uses of the Property, the density and intensity of use of the Property, the maximum
height and size of proposed buildings, the design, improvement and construction standards and
specifications applicable to the Project, including any changes authorized pursuant to Section
3.6.2, the subdivision of land and requirementsfor infrastructure and public improvements, and
other terms and conditions of the Project, shall be the Applicable Rules and the provisions of this
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Agreement. Cityshall accept for processing and review and take action on all applications for
Subsequent Entitlement Approvals as provided in Section 3.9below. In connection with any
Subsequent Entitlement Approval, Cityshall exercise discretion in the same manner as it
exercises its discretion under its police powers, including the Reservationof Authority; provided
however, that such discretion shall not prevent development of the Project as set forth in this
Agreement.
3.8.Timing of Development. The timing of development will be as set forth in the
DDA. Since the California Supreme Court held in Pardee Construction Co. v. City of Camarillo
(1984) 37 Cal. 3d 465, that the failure of the parties therein to provide for the timing of
development resulted in a later adopted initiative restricting the timing of development to prevail
over such parties’ agreement,it is the Parties’intent to cure that deficiency by acknowledging
and providing that Developerwill adhere to the terms of the DDA regarding the timing of
development.
3.9.Subsequent Entitlement Approvals; Changes and Amendments.The Parties
acknowledge that refinement and further development of the Project may require Subsequent
Entitlement Approvals and may demonstrate that changes are appropriate and desirable in the
Existing Entitlement Approvals. Entitlement Approvals (except for this Agreement, the
amendment process for which is set forth in Section2.6) may be amended or modified from time
to time, but only at the written request of Developer or with the written consent of Developer (at
its sole and absolute discretion). All amendments to the Entitlement Approvals shall
automatically become part of the Applicable Rules. In the event Developer finds that a change
in the Existing Entitlement Approvals is necessary or appropriate, Developer shall apply for a
Subsequent Entitlement Approvalto effectuate such change and City shall process and act on
such application in accordance with the Applicable Rules, except as otherwise provided by this
Agreement, including the Reservation of Authority. If approved, any such change in the
Existing Entitlement Approvals shall thereafter be deemed to be an Existing Entitlement
Approval and a Vested Right for all purposes of this Agreement without requiring an amendment
to this Agreement and may be further changed from time to time as provided in this Section.
3.10.Reservationof Authority. Notwithstanding any other provision of this Agreement
to the contrary, the Future Rules described in this Section 3.10 shall apply to and govern
development of the Property and Project to the extent set forth herein.
3.10.1Consistent Future City Regulations. Future Rules shall apply to and
govern development of the Property, provided that any Future Rules which reduce the density or
intensity of the Project below that permitted by the Existing Land Use Regulations or the
Existing EntitlementApprovals, alter the permitted uses of the Property, reduce the maximum
height or size of any permitted buildings, impose additional obligations in connection with the
reservation or dedication of land for public purposes beyond the requirements identified in the
DDA, or limit the rate, timing, or sequencing of development of the Property from that required
in the DDA or in any Entitlement Approvals, shall be deemed inconsistent with this Agreement
and shall not be applicable to the development of the Property and Project.
3.10.2Overriding State and Federal Laws. City shall not be precluded from
adopting and applying Future Rules to the Property and the development of the Project to the
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extent that such Future Rules are required to be applied by State or Federal laws or regulations
and which would override Developer’s Vested Rights as set forth in this Agreement, provided
however, that (a) Developer does not waive its right to challenge or contest the validity of such
State or Federal rules or regulations;and (b) such Future Rules, if otherwise in conflict with the
Vested Rights (as described in Section 3.6.2) shall only be applied to the Project and
development of the Project to the extent necessary to comply with such new State or Federal law
or regulation. In the event that such State or Federal law or regulation (or Future Rules
undertaken pursuant thereto) prevents or precludes substantial compliance with one or more
provisions of the Existing Land Use Regulations or this Agreement, the Parties agree to consider
in good faith amending or suspending such provisions of this Agreement as may be necessary to
comply with such State or Federal laws (or Future Rules), provided that no Party shall be bound
to approve any amendment to this Agreement unless thisAgreement is amended in accordance
with the procedures applicable to the adoption of development agreements as set forth in the
Development Agreement Statute and Tustin City Code and each Party retains full discretion with
respect thereto.
3.10.3Public Health and Safety. Nothing in this Agreement shall preclude the
City Council from adopting and applying Future Rules thatthe City Council finds are reasonably
necessary to protect persons on the Property or in the immediate community, or both, from
conditions dangerous to their health or safety notwithstanding that the applications of such
Future Rules, or other similar limitation would result in the impairment of Developer’s Vested
Rights under the Agreement or the Existing Land Use Regulations. In determining whether any
such Future Rules are reasonably necessary to protect persons as set forth above, the City
Council shall make findings, based on evidence presented to and accepted by the City Council
that the changes are reasonably necessary to protect the public health or safety. The provisions
of this Section 3.10.3 do not apply to any measure adopted by initiative.
3.10.4Uniform Construction Codes and Regulations. Policies and rules
governing engineering and construction standards and specifications applicable to public and
private improvements, including all uniform codes adopted by Cityand any local amendments to
those codes adopted by Cityin the future shall apply to the Project and Property.
3.10.5Police Power.In all respects not provided for in this Agreement, City
shall retain full rights to exercise its police powers to regulate development of the Project and
Property.Any uses or development requiring a concept plan, design review, tentative tract map,
conditional use permit, variance, or other Entitlement Approvals in accordance with Existing
Land Use Regulations shall require a permit or approval pursuant to this Agreement and
notwithstanding any other provision set forth herein, this Agreement is not intended to vest
Developer’s right to issuance of such permit or approval.
3.11.Processing.
3.11.1Subdivisions. A subdivision, as defined in Government Code Section
66473.7, shall not be approved unless a tentative map for the subdivision complies with the
provisions of said Section 66473.7. Thisprovision is included in this Agreement to comply with
Section 65867.5 of the Government Code.
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3.11.2Subsequent Entitlement Approvals.Cityshall employ all lawful actions
capable of being undertaken by Cityto promptly (a)accept all complete applications for
Subsequent Entitlement Approvals (collectively, “Applications”) and (b) process and take action
upon Applications in accordance with the Applicable Rules with a goal of completing the review
within time frames identified in the DDA; provided however, thatCityshall not be deemed in
default under this Agreement should such time frame(s) not be met. To the extent that
Developerdesires that Cityplan check or process an Application on an expedited basis and to the
extent that it requires an additional expense beyond the customary expense applicable to the
general public, Cityshall inform Developerof such additional expense, including the cost of
overtime and private consultants and other thirdparties. If acceptable to Developer,Developer
shall pay the additional cost and Cityshall use good faith efforts to accelerate the processing
time utilizing overtime and the services of private consultants and third parties to the extent
available. Upon the written request of Developer,Cityshall inform Developerof the necessary
application requirements for any requested Cityapproval or requirement relating to the Project.
At such time as a Subsequent Entitlement Approval applicable to the Property is approved by
City, then such Subsequent Entitlement Approvalshall become subject to all of the terms and
conditions of this Development Agreement and shall be treated as an “Entitlement Approval”
under this Development Agreement.
3.11.3Filings.Developershall exercise reasonable efforts to file applications
for Development Permits and Entitlement Approvals within the time frames and schedules as
generally outlined in the DDA and shall exercise reasonable efforts to attempt to obtain
Development Permits and Entitlement Approvals within the time frames identified in the DDA;
provided, however, that failure solely to comply with such time frame(s) shall not be deemed to
be a default under this Agreement.
3.11.4Cooperation.Cityand Developershall cooperate in processing all
applications for permits and approvals for the Project, provided, however, that such cooperation
shall not include any obligation of Cityto incur any un-reimbursed expense, and Cityshall be
entitled, subject to the terms of this Agreement, the DDA and Developer’s rights hereunder, to
exercise all discretion to which it is entitled by law in processing and issuing any permits and
approvals for the Project.
3.11.5Approvals. Notwithstanding any administrative or judicial proceedings,
initiative or referendum concerning any of the Entitlement Approvals, Cityshallprocess
applications for permits and approvals as provided herein to the fullest extent allowed by law and
Developermay proceed at its sole risk with development of the Project pursuant to the DDA the
Applicable Rules and Entitlement Approvals to the fullest extent allowed by law.
3.12.CEQA.This Agreement does not modify, alter or change the City’s obligations
pursuant to CEQA. Developeracknowledges that Cityis required by State law to comply with
CEQA in the consideration and approval of any Subsequent Entitlement Approval and/or any
amendment to this Agreement. The EIR, which has been certified by City as being in
compliance with CEQA, addresses the potential environmentalimpacts of the entire Project as it
is described in the Existing Entitlement Approvals. Nothing in this Agreement shall require or
be construed to require CEQA review of ministerialapprovals. It is agreed that, in acting on any
discretionary SubsequentEntitlement Approvals for the Project, City shall rely on the EIR to
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satisfy the requirements of CEQA to the extent permissible by CEQA.In the event that any
additional CEQA documentation is legally required for any discretionary Subsequent Entitlement
Approval for the Project, then the scope of such documentation shall be focused, to the extent
possible consistent with CEQA,on the specific subject matter of the Subsequent Entitlement
Approval and Cityshall conduct such CEQA review as expeditiously as possible, at Developer’s
expense.Nothing herein shall restrict or limit the obligationof Developer to pay for and
implement any additional mitigation measures orconditions of approvalimposed as a result of
such CEQA and any Subsequent Entitlement Approval process.
3.13.Fees.
3.13.1Processing Fees and Charges.Developershall pay those processing,
inspection and plan checking fees and charges required by Cityunder the then current
regulations for processing applications and requests for permits, approvals, and other actions and
monitoring compliance with any permits issues or approvals granted.
3.13.2Development Fees.Cityshall have the right to impose, and Developer
shall pay, all development fees adopted by Cityat the time of issuance of building permits for the
Project.
3.13.3Project Fair Share Contribution.Developer shall pay its fair share of the
Tustin Legacy Backbone Infrastructure Program, which is equal toSixteen Million Nine
Hundred Thirty Four Thousand Seven Hundred and Four Dollars ($16,934,704)as further
described below (the “Project Fair Share Contribution”):
(a)Provided that upon Recordation the Final Map contains 375 single
family Lots, the amountdue as a condition to building permit issuance for each Home shall be
Forty Five Thousand One Hundred Fifty Nine and 21/00 Dollars ($45,159.21). In the event the
Final Map consists of more or less than 375 single family residential Lots, the Project FairShare
Contribution per Home shall be calculated by dividing $16,934,704by the number of single
family residential Lots shown on the Final Map.
(b)Until the Initial Channel Condition has occurred(as described in
Section 3.17.1), the Project Fair Share Contribution shall be paid by Developeron a per Home
basis as a condition to the issuance of a building permit for each Home developed within the
Property.Upon occurrence of the Initial Channel Condition, the payment of the Project Fair
Share Contribution for the remainder of the Homes within the Project shall be fully due and
payable to Cityas a lump sum(the “Lump Sum Payment”) within 30 Business Days following
delivery by Cityof notice that the Initial Channel Condition hasoccurred. The Lump Sum
Payment shall be equal to the difference between $16,934,704and the amount of the Project Fair
Share Contribution previously paid by Developer to City.
(c)The Project Fair Share Contribution is an independent obligation
of Developer that is due and payable with respect to and in accordance with the terms of this
Agreement.
3.14.Dedications.Developeracknowledges and agrees that it is required (and will be
required) to dedicate to Cityand other public agencies on the approved tentative tract map, or in
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conjunction with Entitlement Approvals, certain required dedications as required by the DDA
andthe Applicable Rules, and pursuant to the EIRand as required pursuant to Developer’s
assumption of CityMCAS Tustin obligations under the “Agreement Between the City of Irvine
and the City of Tustin Regarding the Implementation, Timing, Funding of
Transportation/Circulation Mitigation for the MCAS Tustin Project” and the “Amendment to the
Joint Exercise of Powers Agreement Between the City of Santa Ana and the City of Tustin
Regarding the Tustin-Santa Ana Transportation Improvement Authority”.
3.15.Regulation by Other Public Agencies. It is acknowledged by the Parties that other
public agencies not within the control of Citypossess authority to regulate aspects of the Project
and development of the Property separately from or jointly with Cityand this Agreement does
not limit the authority of such other public agencies. Cityagrees to cooperate fully, at no out of
pocket cost to City, with Developerin obtaining any required permits orcompliance with the
regulations of other public agencies provided such cooperation is not in conflict with any laws,
regulations or policies of City.
3.16.Tentative Tract Map Extension.Any subdivisionmap, heretofore or hereafter
approved in connection with development of the Property, shall be eligible for extensions of time
as provided in Government Code Section 66452.6, except that any extension shall be consistent
with any applicable performance schedule as provided or established in the DDA and shall not
be deemed or considered in any way an extension of any Developerrights or obligations under
the DDA.
3.17.CertainRestrictions onBuilding Permit Issuance.
3.17.1Initial Channel Condition.Cityis a party to that certain Joint Cooperation
Agreement with OCFCD dated March 11, 2003, as amended, relating to improvements to Peters
Canyon Channel, which provides that no more than 1,000 residential units within the former
master developer footprint of Tustin Legacy that drains to Peter’s Canyon Channel(“New
Development Area”)may be issued a certificate of occupancy or occupiedprior to
commencement of additional improvements to Peters Canyon Channel. Developer
acknowledges and agrees that pursuant to the terms of the DDA and the Existing Entitlement
Approvals, from and after issuance of the 242nd building permit, Cityshall not issue building
permits for further Homes until the followinghas occurred: (a) a contract has been let by City
for the Channel Improvements and (b) construction of the Channel Improvements has
commenced (collectively, the “Initial Channel Condition”). To that end, and inasmuch as the
243rd building permit issued with respect to the Property shall constitute the 1001st residential
unit within the former master developer footprint at Tustin Legacy, Developer acknowledges and
agrees that (x) the development of the Project will require issuance by Cityof building permits
which exceed this requirement and (y)unless otherwise agreed by Cityin its sole discretion,City
will not issue building permits for more than 242 units of housing at the Project or upon the
Propertyor any Lot until such time as the Initial Channel Condition is deemed by Cityto be met.
Following the Effective Date, Cityshall not enter into any new agreement for the development of
new residential units within the New Development Areathat permits commencement of
residential units before the Initial Channel Condition has occurred. The Parties acknowledge that
Cityhas previously granted rights to develop 758 residential units to other developers within
Tustin Legacy that are not restricted by this requirement and nothing herein shall restrict the
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rights of developers under agreements previously entered into by City, from constructing
residential units.
3.17.2Recording of Final Map. Development of the Project will require
approval by Cityof the Final Map.Developer acknowledges and agrees that Citywill not issue a
building permitfor any Homes, other than model Homes, until such time as (a) the Final Map
has been approved by Cityand Recorded and (b)Cityand Developer have entered into a
Subdivision Improvement Agreement in form approved by Cityin its Governmental Capacity.
3.18.Quimby Fees and Park Fees. All fees required in connection with the Project
pursuant to the Quimby Act, California Government Code Section66477 are included within the
Project Fair Share Contribution and Developer shall not have any additional liability on account
thereof. In consideration of Developer’s construction of Park Facilities, as set forth in Tustin
Code Section 9331(d),Developer shall have no obligation to pay any park fees or develop any
park facilities (other than the Park Facilities) in connection with the development of the Project.
4.ANNUAL REVIEW.
4.1.Timing and Annual Review. The City Council shall review Developer’s
performance under this Agreement at least every twelve (12) months from the Effective Date
until expiration of the Agreement. In connection with such review, both Cityand Developer
shall have a reasonable opportunity to assert matters which either believes have not been
undertaken in accordance with this Agreement, to explain the basis for such assertion, and to
receive from the other Party a justification of its position on such matters.
4.2.Review Procedure.Cityshall provide notice to Developerand deliver to
Developeror it successor in interest a copy of all public staff reports, documents and related
exhibits concerning City’s review of Developer’s performance hereunder at least 30 days prior to
any date proposed for City Council review of performance under the Agreement
4.2.1Good Faith Compliance.Developeror its Successor in Interest shall
demonstrate good faith compliance with the terms of this Agreement and shall furnish evidence
of good faith compliance, as City, in its reasonable exercise of its discretion, may require.
Evidence of good faith compliance may include the following:
(a)conformance with the DDA including the Scope of Development
and Schedule of Performance;
(b)conformance with the requirements of the Specific Plan; and
(c)conformance with provisions of this Agreement identified by City.
4.2.2Response.Developeror its successor in interest shall have the opportunity
to be heard and respond to City’s evaluation of Developer’s performance, either orally or in a
written statement,at Developer’s election.
4.2.3Non-Compliance.If, as a result of its periodic reviewas described in
Section 4.1, the City Council finds and determines, on the basis of substantial evidence, that the
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Developerhas not complied in good faith with the terms or conditions of this Agreement, the
City Council may commence proceedings to enforce, modify, or terminate this Agreement.
4.2.4Referral. The City Council may refer the matter to the Planning
Commission for further proceedings or for a report and recommendation.
4.3.Modification or Termination.If the City Council determines to proceed with
modification or termination of this Agreement, the City Council shall give notice to Developeror
successor in interest thereto of its intention to do so. The Notice shall contain all information
required by Tustin City Code Section 9618. At the time and place set for the hearing on
modification or termination, the City Council may refer the matter back to the Planning
Commission for further proceedings or for a report and recommendation. The City Council may
take such action as it deems necessary to protect the interests of City, including but not limited
to, the receipt of additional evidence as to Developer’scompliance with the terms of this
Agreement. The decision of the City Council shall be final, subject only to judicial review
pursuant to California Code of Civil Procedure Section 1094.5(b).
4.4.Certificate of Agreement Compliance. If, at the conclusion ofa periodic review,
Developeris found to be in compliance with this Agreement, Cityshall, upon request of the
Developer, issue a Certificate (the “Certificate”) to Developerstating that after the most recent
periodic review and based upon the information known or made known to the City Council that:
(a) this Agreement remains in effect, and (b)Developeris not in default. The Certificate shall be
in recordable form, shall contain information necessary to communicate constructive record
notice of the finding of compliance, and shall state the anticipated date of commencement of the
next periodic review. Developermay record the Certificate with the County Recorder.If City
does not find Developer to be in compliance with this Agreement, it shall not be obligated to
issue the Certificate.
5.DEFAULT, REMEDIES, AND TERMINATION.
5.1.Default Procedure.Anon-defaulting Party (the “Non-Defaulting Party”) at its
discretion may elect to declare a default under this Agreement in accordance with the procedures
hereinafter set forth for any failure or breach of any other Party (“Defaulting Party”) to perform
any material duty or obligation of said Defaulting Party in accordance with the terms of this
Agreement. However, the Non-Defaulting Party must provide written notice to the Defaulting
Party setting forth the nature of the breach or failure and the actions, if any, required by the
Defaulting Party to cure such breach or failure. The Defaulting Party shall be deemed to be in
“default” of its obligations set forthin this Agreement if the Defaulting Party has failed to take
action and cure the default within ten (10) days after the date of such notice (for monetary
defaults) or within thirty (30) days after the date of such notice (for non-monetary defaults). If,
however, a non-monetary default cannot be cured within such thirty (30) day period, as long as
the Defaulting Party does each of the following:
(a)notices the Non-Defaulting Party in writing with a reasonable explanation
as to the reasons the asserted defaultis not curable within the thirty (30) day period;
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(b)notifies the Non-Defaulting Party in writing of the Defaulting Party’s
proposed course of action to cure the default;
(c)promptly commences to cure the default within the thirty (30) day period;
(d)makes periodic written reports to the Non-Defaulting Party as to the
progress of the program of cure;and
(e)diligently prosecutes such cure to completion,
then the Non-Defaulting Party shall grant in writing the Defaulting Party such additional time as
determined by the Non-Defaulting Party as reasonably necessary to cure such default.
5.2.City’ Remedies.In the event of an uncured defaultby Developer under this
Agreement, the City, at its option, may institute legal action to cure, correct or remedy such
default, enjoining any threatened or attempted violation, enforce the terms of this Agreement by
specific performance, or pursue any other legal or equitable remedy. Furthermore, City, in
addition to or as an alternative to exercising the remedies in this Section 5.2, in the event of a
material default by Developer, may give notice of its intent to terminate or modify this
Agreement pursuant to Section 4.3, in which event the matter shall be scheduled for
consideration and review by the City Council in the manner set forth in Tustin City Code Section
9618. The decision of the City Council shall be final, subject only to judicial review pursuant to
California Code of Civil ProcedureSection 1094.5(b).
5.3.Developer’sRemedies.In the event of an uncured default of City under this
Agreement,Developershall be entitled to any or all of the following remedies: (a)seeking
mandamus or special writs, injunctive relief, or specific performance of this Agreement; (b)
modification or termination of this Agreement; or (c)seeking any other remedy available at law
or in equity, provided, however, except as provided in Section 8.10 below, the Developeragrees
and covenants on behalf of itself andit successors and assigns, not to sue Cityfor damages or
monetary relief for any breach of this Agreement or arising out of or connected with any dispute,
controversy or issue regarding the application or effect of this Agreement, or for general, special,
compensatory, expectation, anticipation, indirect, consequential, exemplary, or punitive damages
(“Damages”) arising out of or connected with any dispute, controversy, or issues regarding the
application or effect of this Agreement, the DDA, the Applicable Rules, or any Development
Permits or Entitlement Approvals sought in connection with development or use of the Property
or Project, or any portion thereof. Developeracknowledges that Citywould not have entered
into this Agreement if Citycould be held liable for Damages for any default or breach arising out
of this Agreement and that Developerhas adequate remedies other than Damages to secure
City’s compliance with its obligations under this Agreement. Therefore, Developeragrees that
City, its officers, employees and agents shall not be liable for any Damages and that this section
shall apply to allSuccessors in Interestof the Developer.
5.4.Third Party Legal Challenges.In the event of any legal action instituted by a third
party challenging the validity or enforceability of any provision of this Agreement, the
ApplicableRules, the DDA, or Entitlement Approvals for the Project or the approval of any
CEQA document prepared in connection with the foregoing, Developeragrees, at its sole cost
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and expense, to defend (with counsel reasonably acceptable to City), indemnify, and hold
harmless City, its officers, employees, agents, and consultants, from any claim, action, or
proceeding against City, its officers, agents, and employees, which seeks to attack, set aside,
challenge, void, or annul an approval of the City Council, the Planning Commission, or any other
decision-making body, including staff, concerning theProject.Cityagrees to promptly notify
Developerof any such claim or action filed against Cityand to cooperate in the defense of any
such action. Developershall also indemnify and hold harmless Cityand its agents, officials and
employees from and against all claims, losses, or liabilities assessed or awarded against Cityby
way of judgment, settlement, or stipulation. Citymay elect to participate in the defense of any
such action under this condition.
6.INDEMNITY BY DEVELOPER.
Developeragrees to indemnify, defend, and hold harmless City,City’s designees, and
their respective elected and appointed officials, boards, commissions, agents, contractors, and
employees from and against any and all actions, suits, claims, liabilities, losses, damages,
penalties, obligations and expenses (including but not limited to attorney’s fees and costs)which
may arise, directly or indirectly, from the acts, omissions, or operations of Developeror
Developer’s agents, contractors, subcontractors, agents, or employees pursuant to this
Agreement, but excluding any loss resulting from the intentional or active negligence of City,
City’s designee, or each of their respective elected and appointed officials, boards, commissions,
officers, agents, contractors, and employees. Developershall select and retain counsel
reasonably acceptable to Cityto defend any action or actions and Developershall pay the cost
thereof. The indemnity provisions set forth in this Agreement shall survive termination of the
Agreement.
7.MORTGAGEE PROTECTION.
The Parties hereto agree that this Agreement shall not prevent or limit Developer, in any
manner, from encumbering the Property or any portion thereof or any improvement thereon by
any Mortgagesecuring financing with respect to the Property; provided that nothing herein shall
modify or amend the restrictions setforth in the DDA with respect to Mortgages.Any
Mortgagee holding a Mortgage that is not prohibited by the DDAshall be entitled to the
following rights and privileges:
(a)This Agreement shall be superior and senior to anylien placed upon the Property
or any portion thereof after the date of recording of this Agreement, including without limitation
the lien of any Mortgage. Notwithstanding the foregoing, neither entering into this Agreement
nor a breach of this Agreement shall defeat, render invalid, diminish or impair the lien of any
Mortgage on the Property made in good faith and for value, unless otherwise required by law,
and any acquisition or acceptance of title or any right or interest in or with respect to the Property
or any portion thereof by a Mortgagee(whether pursuant to foreclosure, trustee’s sale, deed in
lieu of foreclosure, lease termination or otherwise) shall be subject to the terms and conditions of
this Agreement and any such Mortgagee who takes title to the Property or any portion thereof
shall be entitled to benefits arising under this Agreement.
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(b)Each Mortgagee of any Mortgageencumbering the Property, or any part thereof,
and which is not securing the interest of an End User shall upon written request in writing to
City, be entitled to receive written notice from Cityof results of the Annual Review and of any
default by Developerin the performance of Developer’s obligations under this Agreement
concurrently with delivery of same to Developerand shall have the right, but not the obligation,
to cure the default during the remaining cure period allowed such Party under this Agreement
(including any extended cure period necessary in order to allow the Mortgagee to obtain title to
the Property and cure the default). Notwithstanding the foregoing, the failure of Cityto deliver a
concurrent copy of such notice of default to a Mortgagee shall not affect in any way the validity
of the notice of default as it relates to the Developer, and provided, further, the giving of any
notice of default or the failure to deliver a copy to any Permitted Mortgagee shall in no event
create any liability on the part of the Person so declaring a default.
(c)Any Mortgagee who comes into possession of the Property, or any part thereof,
pursuant to foreclosure of the Mortgageor deed in lieu of such foreclosure, shall take the
Property, or part thereof, subject to the terms of this Agreement. Notwithstanding any other
provision of this Agreement to the contrary, no Mortgagee shall have an obligation or duty under
this Agreement to perform any of Developer’s obligations or other affirmative covenants of
Developerhereunder, or to guarantee such performance; except that (i) the Mortgagee shall have
no right to develop the Property without fully complying with the terms of this Agreement, the
DDA, the Applicable Rules and Entitlement Approvals and (ii) to the extent that any covenant to
be performed by Developeris a condition precedent to the performance of a covenant by City,
the performance thereof shall continue to be a condition precedent to City’s performance
hereunder.
Notwithstanding anything to the contrary contained above in this Section, any Mortgagee
shall be subject to all of the terms of the DDA, to the extent applicable pursuant to the DDA to
such Mortgagee.
8.MISCELLANEOUS PROVISIONS.
8.1.Recordation of Agreement. This Agreement and any amendment or cancellation
thereof shall be recorded with the Orange County Recorder by the City Clerk within ten (10)
days after Cityexecutes this Agreement, as required by Section 65868.5 of the Government
Code. If the Parties to this Agreement or their Successors in Interest amend or cancel this
Agreement as provided for herein and in Government Code Section 65868, or if Cityterminates
or modifies this Agreement as provided for herein and in Government Code Section 65865.1 for
failure of Developerto comply in good faith with the terms or conditions of this Agreement, the
City Clerk shall have notice of such action recorded withthe Orange County Recorder.
8.2.Entire Agreement. This Agreement sets forth and contains the entire
understanding and agreement of the Parties with respect to the matters set forth herein, and there
are no oral or written representations, understandings or ancillary covenants, undertakings or
agreements which are not contained or expressly referred to herein. No testimony or evidence of
any such representations, understandings or covenants shall be admissible in any proceeding of
any kind or nature to interpret or determine the terms or conditions of this Agreement.
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8.3.Severability. If any term, provision, covenant or condition of this Agreement
shall be determined invalid, void or unenforceable, the remainder of this Agreement shall not be
affected thereby to the extent such remaining provisions are not rendered impractical to perform
taking into consideration the purposes of this Agreement.
8.4.Interpretation and Governing Law. This Agreement and any dispute arising
hereunder shall be governed and interpreted in accordance with the internal laws of the State of
California without reference to choice of law or conflicts of law provisions. This Agreement
shall be construed as a whole according to its fair language and common meaning to achieve the
objectives and purposes of the Parties hereto, and the rule of construction to the effect that
ambiguities are to be resolved against the drafting Party shall not be employed in interpreting
this Agreement, all Parties having been represented by counsel in the negotiation and preparation
hereof. The decision of the City Council shall be final, subject only to judicial review pursuant
to California Code of Civil Procedure Section 1094.5(b).
8.5.Section Headings. All section headings and subheadings are inserted for
convenienceonly and shall not affect any construction or interpretation of this Agreement.
8.6.Construction.
8.6.1References to Sections, Clauses and Exhibits. Unless otherwise indicated,
references in this Agreement to sections, clauses and exhibits are to the same contained in or
attached to this Agreement and all exhibits referenced in this Agreement are incorporated in this
Agreement by this reference as though fully set forth in this Section.
8.6.2Singular and Plural. As used herein, the singular of any word includes the
plural.
8.6.3Includes and Including.As used in this Agreement the words “include”
and “including” mean, respectively, “include, without limitation” and “including, without
limitation”.
8.7.Time of Essence. Subject to the following sentence, time is of the essence in the
performance of each provision of this Agreement. Whenever action must be taken (including the
giving of notice or the delivery of documents) under this Agreement during a certain period of
time or by a particular date that ends or occurs on a non-Business Day, then such period or date
shall be extended until the immediately following BusinessDay.
8.8.Waiver. Failure by a Party to insist upon the strict performance of any of the
provisions of this Agreement by the other Party, or the failure by a Party to exercise its rights
upon the default of the other Party, shall not constitute a waiver ofsuch Party’s right to insist and
demand strict compliance by the other Party with the terms of this Agreement thereafter.
8.9.No Third Party Beneficiaries.This Agreement is made and entered into for the
sole protection and benefit of the Parties and their successors and assigns. No other person shall
have any right of action based upon any provision of this Agreement.
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8.10.Attorneys’ Fees.If any Party to this Agreement institutes any action, suit,
counterclaim or other proceeding for any relief against another Party, declaratory or otherwise
(collectively an “Action”), to enforce the terms hereof or to declare rights hereunder or with
respect to any inaccuracies or material omissions in connection with any of the covenants,
representations, warranties or obligations on the part of the other Party to this Agreement, then
the Prevailing Party in such Action shall be entitled to have and recover of and from the other
Party all costs and expenses of the Action, including (a) the Prevailing Party’s reasonable
attorneys’ fees which shall be payable at the actual contractual hourly rate for City’s litigation
counsel at the time the fees were incurred, but in no event less than $200 per hour and (b) costs
actually incurred in bringing and prosecuting such Action and/or enforcing any judgment, order,
ruling or award (collectively, a “Decision”) granted therein, all of which shall be deemed to have
accrued on the commencement of such Action and shall be paid whether or not such Action is
prosecuted to a Decision. Any Decision entered in any final judgment shall contain a specific
provision providing for the recovery of all costs and expenses of suit, including reasonable
attorneys’ fees and expert fees and costs (collectively “Costs”) incurred in enforcing, perfecting
and executing such judgment. For the purposes of this paragraph, Costs shall include in addition
to Costs incurred in prosecution or defense of the underlying action, reasonable attorneys’ fees,
costs, expenses and expert fees andcosts incurred inpost judgment motions and collection
actions,contempt proceedings,garnishment, levy, debtor and third party examinations,
discovery,bankruptcy litigation,and appeals of any order or judgment. “Prevailing Party”
within the meaning ofthis Section 8.10includes a Party who agrees to dismiss an Action in
consideration for the other Party’s payment of the amounts allegedly due or performance of the
covenants allegedly breached, or obtains substantially the relief sought by such Party.
8.11.Force Majeure.
8.11.1“Force Majeure Delay” shall mean the occurrence of any of the following
events when such event is beyond the control of the claiming Party and such Party’s contractors
and consultants and is not due to an act or omission of such Party or any consultant, contractor or
other Person for whom such Party may be contractually or legally responsible, which directly,
materially and adversely affectsthe ability of the claiming Party to meet its non-monetary
obligations under this Agreement, including the deadlines imposed by the Schedule of
Performance, or the ability of Developerto Complete the Project, and which events (or the effect
of which events) could not have been avoided by due diligence and use of reasonable efforts by
the Party claiming Force Majeure Delay:
(a)CivilUnrest. An epidemic, blockade, quarantine, rebellion, war,
insurrection, act of terrorism, strike or lock-out, riot, act of sabotage, civil commotion, act of a
public enemy, freight embargo, or lack of transportation;
(b)UnforeseeableConditions. Reasonably unforeseeable physical
condition of the Property including the presence of Hazardous Materials;
(c)Casualty. Fire, earthquake, or other casualty, in each case only if
causing material physical destruction or damage on the Property;
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(d)Litigation. Any lawsuit seeking to restrain, enjoin, challenge or
delay any issuance of any Entitlement Approval or seeking to restrain, enjoin, challenge, or delay
construction of the Project which is defended by the FirstParty;
(e)Weather. Unusually severe weather conditions not reasonably
anticipatable for the City of Tustin, based upon U.S. Weather Bureau climatological reports for
the months included plus a report indicating average precipitation, temperature, etc. for the last
ten (10) years from the nearest reporting station.
8.11.2Limitation. The term “Force Majeure Delay” shall be limited to the
matters listed in Section8.11.1 above and specifically excludes from its definition the following
matters which might otherwise be considered Force Majeure Delay:
(a)Entitlements. The suspension, termination, interruption, denial or
failure to obtain or nonrenewal of any Entitlement Approval or Development Permit, license,
consent, authorization orother permit orapproval which is necessary for the development of the
Project, except for any such matter resulting from a lawsuit as described in Section8.11.1(d);
(b)Foreseeable Changes in Governmental Requirements. Any change
in Government Requirementswhich was proposed or was otherwise reasonably foreseeable at
the Effective Date;
(c)Failure to Perform Obligations. Failure of Developerto perform
any obligation to be performed by Developeras the result of adverse changes in the financial
condition of Developer;
(d)Failure to Provide Financial Security. Failure of Developerto
provide financial security required by this Agreement when due or to submit evidence of
financing of the Project or to perform any obligation to be performed by Developerhereunder as
the result of adverse changes in market conditions;
(e)Failure to Submit Required Documentation. Failure to submit
documentation as and when required by this Agreement;
(f)Failure to Submit Entitlement Applications. Failure to timely
submit applications for any Entitlement Approval or Development Permit required for
construction of the Improvements or development of the Project on the Propertywhen required
pursuant to the Schedule of Performance; and
(g)Failure to Execute Documents. Failure of the First Party to
execute documents; and
(h)Other Matters. All other matters not caused by the SecondParty
and not listed in Section18.11.1.
8.11.3If any Party (the “First Party”) believes that an extension of time is due to
Force Majeure Delay, it shall notify the other Party (the “Second Party”) in writing within ninety
(90) calendar days from the date upon which the First Party becomes aware of such Force
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Majeure Delay, generally describing the Force Majeure Delay and its date of commencement.
Upon written request from the Second Party, the First Party shall promptly provide the following
information with respect to such Force Majeure Delay: a more detailed description of the Force
Majeure Delay, when and how the First Party obtained knowledge thereof, the steps the First
Party anticipates taking to respond to such Force Majeure Delay, and the estimated delay
resulting from such Force Majeure Delay and responseand such other information as the Second
Party may reasonable request. The extension for Force Majeure Delay shall be granted or denied
in the Second Party’s reasonable discretion. If the First Party fails to notify the Second Party in
writing of its request for a given Force Majeure Delay within the ninety (90) calendar days
specified above, there shall be no extension for such Force Majeure Delay.
8.11.4Time periods for performance of any obligations under this Agreement
may be extended for Force Majeure, except that in no event, shall the Term of this Agreement be
extended by an event of Force Majeure Delay beyond that set forth in Section 2.3.
8.12.Successors in Interest.The burdens of this Agreement shall be binding upon, and
the benefits of this Agreement shall inure to, all Successors in Interest to the Parties to this
Agreement. All provisions of this Agreement shall be enforceable as equitable servitudes and
constitute covenants running with the land. Each covenant to do or refrain from doing some act
hereunder with regard to development of the Property: (a) is for the benefit of and is a burden
upon every portion of the Property; (b) runs with the Property and each portion thereof; and,
(c)is binding upon each Party and each Successor in Interest during ownership of the Property or
any portion thereof.
8.13.Counterparts. This Agreement may be executed by the Parties in counterparts,
which counterparts shall be construed together and have the same effect as if all of the Parties
had executed the same instrument.
8.14.Jurisdiction and Venue.Any action at law or in equity arising under this
Agreement or brought by a Party hereto for the purpose of enforcing, construing or determining
the validity of any provision of this Agreement shall befiled and tried in the Superior Court of
the County of Orange, State of California, or the United States District Court for the Central
District of California, Santa Ana Division, and the Parties hereto waive all provisions of law
providing for the filing, removal or change of venue to any other court.
8.15.Project as a Private Undertaking. It is specifically understood and agreed by and
between the Parties hereto that the development of the Project is a private development, that
neither Party is acting as the agent of the other in any respect hereunder, and that each Party is an
independent contracting entity with respect to the terms, covenants and conditions contained in
this Agreement. No partnership, jointventure or other association of any kind is formed by this
Agreement. The only relationship between Cityand Developerwith respect to this Agreementis
that of a government entity regulating the development of private property and the developerof
such property.
8.16.Further Actions and Instruments. Each of the Parties shall cooperate with and
provide reasonable assistance to the other to the extent contemplated hereunder in the
performance of all obligations under this Agreement and the satisfaction of the conditions of this
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Agreement. Upon the request of either Party at any time, the other Party shall promptly execute,
with acknowledgment or affidavit if reasonably required, and file or record such required
instruments and writings and take any actions as may be reasonably necessary under the terms of
this Agreement to carry out the intent and to fulfill the provisions of this Agreement or to
evidence or consummate the transactions contemplated by this Agreement.
8.17.Estoppel Certificate. Any Party hereunder, may at any time, deliver a written
notice to the other arty requesting such Party to certify in writing that, to the best knowledge of
the certifying Party: (a) this Agreement is in full force and effect and a binding obligation of the
Party; (b) this Agreement has not been amended or modified either orally or in writing, or if so
amended, identifying the date and nature of the amendments to this Agreement, and, in each
case, that the Agreementremains in full force and effect (including as amended or modifiedif
applicable), and a continuing binding obligation of the Party; and (c) the requesting Party is not
in default in performance of itsobligations set forth in the Agreement, or if the Party is in
default, provide a description of the nature of such default(s). A Party receiving a request
hereunder shall execute and return such certificate within thirty (30) days following receipt
thereof. The party to whom such certificate is addressed, including anythird party or Mortgagee,
shall be entitled to rely on the certificate. Developer shall pay to City all costs incurred by City
in connection with the issuance of estoppel certificates.
8.18.Authority to Execute.The person or persons executing this Agreement on behalf
of each Party warrants and represents that he or she/they have the authority to execute this
Agreement on behalf of such Party and warrants and represents that he or she/they has/have the
authority to bind such Party to the performance of its obligations hereunder.
{signatures on following page}
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SIGNATURE PAGE
TO DEVELOPMENT AGREEMENT
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the day
and year set forth below.
City
“”
City of Tustin, California
By:
_________________________, Mayor
ATTEST:
By:
Erica Rabe
City ClerkServices Supervisor
Dated:
APPROVED AS TO FORM
Office of the City Attorney
By:
David E. Kendig, Esq.
Developer
“”
By:Standard Pacific Corporation, a Delaware
Corporation
By:
Name:
Its:
By:
Name:
Its:
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Stan Pac DA 1-31-2014 FINALCity of Tustin/Standard Pacific Corp.
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EXHIBIT “A”
TO DEVELOPMENT AGREEMENT
Legal Description of Property
EXHIBIT A
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EXHIBIT “B”
TO DEVELOPMENT AGREEMENT
Map showing Property and its location
EXHIBIT B
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EXHIBIT “C”
TO DEVELOPMENT AGREEMENT
PUBLIC BENEFITIMPROVEMENTS
As additional Public Benefits, Developer shall design and construct the following in
accordance with the requirements of the applicable conditions of approval.
1.Park Facilities, comprised of a 6.1 acre private park and related amenities, to
which public access will be provided, subject to rules and regulations to be approved by
City,which shall be Completed prior to the date set forth for Completion of the Park
Facilities in the Schedule of Performance.
2.The landscape and irrigation system along (a)the parkway of Moffett Drive
adjacent to the Project from Park Avenue to Jamboree Road, (b) Jamboree Road and the
ramp to Park Avenue and (c) the parkway of Park Avenue adjacent to the Project from
the ramp to Park Avenue to Moffett Drive, in each case prior to the date set forth for
Completion of such work in the Schedule of Performance.
EXHIBIT C
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EXHIBIT “D”
TO DEVELOPMENT AGREEMENT
BASE YEAR TAX BURDEN SCHEDULE
LOWESTTAX A AND
BASETUSD CFD
SPECIAL TAX CLASSPRICE(COMBINED)TAX B
CLASS 1
RESIDENTIAL PROPERTY (>= 3,530 SF)$1,004,900$5,008$1,507
CLASS 2
RESIDENTIAL PROPERTY (3,210 -3,529 SF)$939,900$4,684$1,410
CLASS 3
RESIDENTIAL PROPERTY (2,890 -3,209 SF)$871,900$4,345$1,308
CLASS 4
RESIDENTIAL PROPERTY (2,570 -2,889 SF)$774,900$3,862$1,162
CLASS 5
RESIDENTIAL PROPERTY (2,250 -2,569 SF)$669,900$3,339$1,005
CLASS 6
RESIDENTIAL PROPERTY (< 2,250 SF)$574,900$2,865$862
EXHIBIT D
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