HomeMy WebLinkAbout05 APPROVE AGREEMENT D02-119-2 WITH OC FLOOD CONTROL RE. PETERS CANYON4�
�5�1 AGENDAREPORT
MEETING DATE: APRIL 7, 2015
TO: JEFFREY C. PARKER, CITY MANAGER
Agenda Item
Reviewed:
City Manager
Finance Director
FROM: DOUGLAS S. STACK, DIRECTOR OF PUBLIC WORKS /CITY ENGINEER
SUBJECT: APPROVE COOPERATIVE AGREEMENT NO. D02 -119 -2 WITH THE ORANGE
COUNTY FLOOD CONTROL DISTRICT INCREASING THE RESIDENTIAL
UNIT LIMIT FOR THE CONSTRUCTION OF THE PETER'S CANYON
CHANNEL FLOOD CONTROL IMPROVEMENTS
SUMMARY
Cooperative Agreement D02 -119 dated March 11, 2003 as amended established terms and
conditions under which certain Peter's Canyon Channel Flood Control Improvements would be
scheduled, engineered, financed, constructed, operated, and maintained. Cooperative Agreement
D02 -119 -2 increases the residential certificate of occupancy limit of 1,000 units, established in the
original approved agreement with the Orange County Flood Control District (OCFCD) and the
County of Orange, by an additional 200 units to 1,200 units. Prior to that limit being reached, the
Peter's Canyon Channel Improvements,are required to be awarded and construction commenced.
RECOMMENDATION
It is recommended that the City Council approve Cooperative Agreement No. D02 -119 -2 with the
Orange County Flood Control District and the County of Orange and authorize the City Manager
and City Clerk to execute the agreement on behalf of the City.
FISCAL IMPACT
Benefits associated with the proposed action include:
1. Bonds associated with CFD 2014 -1 and the Standard Pacific development can now be sold
unencumbered by the cap on residential certificates of occupancy thereby expediting cash flow
from bond proceeds from Standard Pacific for Tustin Legacy Backbone Infrastructure needs.
The net proceeds to the City will be approximately $13.1 million.
2. The Fair Share Backbone payment of $16.93 million from Standard Pacific will be accelerated
and is expected to be paid during the first quarter of FY 2015 -2016.
3. Outflow of cash for the Peter's Canyon Channel Improvements will be delayed by several
months.
4. Construction of the Peter's Canyon Channel Improvements can be started in the spring instead
of late summer thereby ensuring more dry weather work time.
5. The Peter's Canyon Channel Water Capture and Reuse Pipeline Project, a multi- agency
project of which the City is a participant and the construction of which is being handled by the
Irvine Ranch Water District (IRWD), is starting construction this year and is in the same location
as the Peter's Canyon Channel Improvements. Not constructing simultaneously will avoid
untold coordination delays and increased construction costs for both the Pipeline Project and
the Improvements Project.
Approve Cooperative Agreement No. D02 -119 -2 with OCFCD
April 7, 2015
Page 2
CORRELATION TO THE STRATEGIC PLAN
This agreement contributes to the fulfillment of three goals in the City's Strategic Plan. First is
contribution to the fulfillment of the City's Strategic Plan Goal A: Economic and Neighborhood
Development; specifically the project implementation of Strategy #1 which, among other items, is to
develop critical phases of Tustin Legacy. Secondly is implementation of Goal B, Strategy #3 to
ensure public safety and protection of assets through continuous maintenance and improvement of
public facilities. Lastly the project also addresses Goal D, Strategy #2 by working collaboratively
with agencies to address issues of mutual interest and concern.
DISCUSSION AND BACKGROUND
Cooperative Agreement No. D02 -119 -2 has been prepared to amend Section 5.3.3.4 of the original
agreement to require a contract for construction of Peter's Canyon Channel Improvements be
awarded and construction commenced prior to the issuance of certificates of use and occupancy
for the 1,2015' residential unit in Tustin Legacy. This represents an increase from the prior limit of
1,000 residential units. The limit of certificates of use and occupancy on no more than 270 acres
of land remains unchanged.
The major reason for the increase to the certificates of use and occupancy limit is to allow for the
postponement of the Peter's Canyon Channel Improvements so as not to interfere with the Peter's
Canyon Channel Water Capture and Reuse Pipeline Project. The Peter's Canyon Channel Water
Capture and Reuse Pipeline Project involves the County of Orange, the Orange County Flood
Control District ( OCFCD), the Irvine Ranch Water District (IRWD), California Department of
Transportation (Caltrans), and the Cities of Irvine and Tustin, with IRWD acting and the lead
agency. Staff from OCFCD recognized the conflicting construction timelines of these projects and
offered an amendment to the City's current agreement, which would postpone the construction
timeline for the Peter's Canyon Channel Improvements.
According to IRWD's consultants, there would be substantial monetary and time delay factors
associated with the Pipeline Project should both projects be under construction at the same time.
Their analysis estimated a cost impact of approximately $700k and an additional 6 month minimum
to the Pipeline Project timeline due to construction staging and coordination inefficiencies. The
Pipeline Project also requires a construction contract to be awarded by June 30, 2015 as part of a
$3.3M OCTA Measure M M2 Tier 2 environmental grant. This deadline has already been
extended once and cannot be extended again.
Currently, the City is required to begin construction on the Peter's Canyon Channel Improvements
late this summer to ensure Standard Pacific can obtain all certificates of use and occupancy of
their total 375 approved residential units. Standard Pacific is aware that only 242 certificates can
be issued per the City's existing agreement with OCFCD. The amendment provides the City with
an increased unit limit, which will not restrict the number of certificates that can be provided to
Standard Pacific and provides the City with flexibility to start the Peter's Canyon Channel
Improvements at a more appropriate time.
The limitation of 1,000 units presents two separate funding issues. First, it delays the issuance of
bonds for the new CFD related to this housing development, which total approximately $13.1
million. Second, the DDA with Standard Pacific allows for incremental payment of the Fair Share
Backbone fee to ensure the developer would only pay for those units that the City could provide
certificates of use and occupancy. The City Manager's Office, through the Economic Development
Division, is working to amend the DDA with Standard Pacific that would accelerate the Fair Share
Approve Cooperative Agreement No. D02 -119 -2 with OCFCD
April 7, 2015
Page 3
Backbone payment and lift the current restriction for the construction of additional units based on
the existing agreement between the City and OCFCD.
The City Attorney has reviewed and approved Cooperative Agreement No. D02 -119 -2 as to form.
Stack, P.E.
Public Works /City Engineer
Attachment 1: Cooperative Agreements No. D02 -119 & D02 -119 -1
Attachment 2: Cooperative Agreement No. D02 -119 -2
S: \City Council Items\2015 Council Items \04 -07- 2015 \Flood Control Agreement PCC\Approval of Coop Agmt #D02 -119 -2 w County
SC.docx