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Home My WebLink AboutCC 17 LOU T RCH COMM 11-01-93 GENDA __,~SENT CALENDAR NO. 17 11-1-93 Inter-Com DATE: NOVEMBER 1, 1993 TO: WILLIAM A. HUSTON, CITY MANAGER FRO~: COMMUNITY DEVELOPMENT DEPARTMENT SUBJEO~ THIRD AMENDMENT TO LETTER OF UNDERSTANDING CONCERNING THE COMMUNITY PARK FOR THE TUSTIN RANCH COMMUNITY RECOMMENDATION It is recommended that the city Council authorize the city Manager to execute the Third Amendment to the March 11, 1989 Letter of Understanding with the Irvine Company. FISCAL IMPACT :There would be no negative financial impact to the City as a result of this item. Based upon the provisions of this Letter Of Understanding, $469,200 would be contributed between now and May of 1995 to the City for use by the City to develop parkland within East Tustin. BACKGROUND/DISCUSSION The City of Tustin and the Irvine Company executed a Letter of Understanding dated March 11, 1989 regarding the relocation of a community park from Sector 11 to Sector 7 of the East Tustin Specific Plan to expand the possible future high school in Sector 11 to include 40 acres. As part of the letter agreement, the Irvine Company originally agreed to provide a 2 acre private park in conjunction with the future subdivision of Lots 18 and 19 of the Phase III Map (Tract 12870). The Irvine Company subsequently requested and the City Council approved on April 3, 1991, a modification to the original Letter of Understanding to permit the Company to relocate the 2 acre private park obligation to be provided in conjunction with the subdivision of Lot 13 instead of Lots 18 and 19. On October 21, 1991, in conjunction with approval of Vesting Tentative Tract Map 13733 (Lot 13), the City Council approved a second amendment to the Letter of Understanding. That amendment permitted the Irvine Company to replace the requirement that any subdivision on Lot 13 contain a 2 acre private park with the requirement for a payment equal to $2,000 per multiple family residential unit created with the approved subdivision. Item City Council Report Third Amendment to ~Letter of Understanding November 1, 1993 Page 2 number 6 of page 3 of the Letter of Understanding was revised in the second amendment to.read as follows: "6. A 2 acre private park (the "Private Park") shall be created in conjunction with any future single family subdivision of Lot 13 of the Phase III map, and improved at Company's sole cost and expense, to replace the neighborhood park that was formerly to be located on Lot 16 on the Phase III map. In the event; a multiple family project is proposed on Lot 13, the obligation to provide the 2 acre private park shall be satisfied inl full by an in-lieu payment equal to $2,000 per multiple family residential unit created in the future subdivision of Lot 13 subject to the following conditions: ae be co No credit will be given a builder for provision of any on-site recreation facilities in conjunction with ~a multiple-family development in order to offset or discount the required payment of $2,000 per unit. The City shall collect the $2,000 per unit payment at time building permits are issued' by phase for the project. In the event that permits for all units have not been issued prior to May 1, 1995, then the remaining balance of the in-lieu payment equal to $2,000 per multiple family residential unit shall immediately become due and payable on May 1, 1995. Failure to make said remaining payment by May 1, 1995, will be considered late and the City shall affix an annualized penalty fee of 15% computed on a daily basis on the unpaid balance. City will commit to spend funds collected under this agreement for recreation facilities in Tustin Ranch but City makes no commitment as to timing of said expenditures or specific facilities to be funded. d. It is mutually agreed that the in-lieu payment of $2,000 per multiple-family residential unit does not constitute any precedent for any purpose other than this agreement as to the amount of any future local park fees, establishment of land value or other related issues." The subdivider has chosen not to construct the 236 unit multiple family proj~ect and a 138 unit single family patio home project for Lot 13 was recently approved by the City Council in September of 1993. Condition of Approval 9.4 of Resolution No. 3185 which approved the proposed 138 unit patio home project required the Letter of Understanding to be amended to read as follows: City Council Report Third Amendment to Letter of Understanding November 1, 1993 Page 3 "9.4 Prior to issuance of building permits, including grading permits, the Irvine Company shall amend the Letter of Understanding between the City of Tustin and the Irvine Company dated March 11, 1989, with subsequent modifications and amendment dated October 21, 1991 to comply with the following conditions: ae No credit will be given to a builder for provision of any on-site recreation facilities in conjunction with a patio home development in order to offset or discount the required payment of $3,400 per unit. S · Ce The City shall collect the $3,400 per unit payment at time building permits are issued by phase of the project. In the event that permits for units have not been issued prior to May 1, 1995, then the remaining balance of the in-lieu payment equal to $3,400 per patio home residential dwelling unit shall immediately become due and payable on May 1, 1995. Failure to make~ said remaining payment by . May 1, 1995, .will be considered late and the City shall affix an annualized penalty fee of 15% computed on a daily basis on the unpaid balance. City will commit 't°' spend funds collected under this agreement for recreation facilities in Tustin Ranch but City makes no commitment as to timing of said expenditures or specific facilities to be funded. De It is mutually agreed that the in-lieu payment of $3,400 per patio home residential dwelling does not constitute any precedent for any purpose other than this agreement as to the amount of any future local park fee, establishment of land value or other related issues." Lot 13 is located on Robinson Drive across from the future 20 acre community sports park site. Given significant fiscal issues associated with future parks, the Company is agreeable to replacing the requirement that any subdivision of Lot 13 contain a private park with the requirement for a payment equal to $3,400 per residential unit. With preliminary plans indicating a proposal for 138 units on Lot 13, the Company's in-lieu payment would represent approximately $469,200 which can be placed in the park development fund for East Tustin. This amount represents the same in-lieu payment that would have been collected under the existing Letter of City Council Report Third Amendment to Letter of Understanding November 1, 1993 Page 4 Understanding for the 236 multiple family units previously proposed for this lot. Daniel Fox If the proposed approach is acceptable to the Council, it is recommended that the City Council authorize the City Manager to execute the Third Amendment to the March 11, 1989 Letter of Understanding with The Irvine Company in substantially the same format as attached, and subject to final City Attorney approval. Senior Planner Attachment: Letter of Understanding CAS:br :3rdamd. ico THE IRVINE COMPANY October 6, 1993 Mr. William A. Huston City Manager City of Tustin 300 Centennial Way Tustin, California 92680 Re: Tustin Ranch Park Agreement Vesting Tentative Tract 13733 Dear Bill: The October 4, 1993 letter from Joann S. Lehmer with the proposed Amendment to the March 11, 1988 Letter of Understanding appears to have satisfactorily resolved the remaining questions regarding an agreement on in-lieu park fees for vesting Tentative Tract 13733. The proposed Amendment establishes "the fee" to be paid on behalf of the recently approved Tract 13733. Pursuant to the Conditions of Approval for Tract Map 13733, the Letter of Understanding has been amended to establish an in-lieu park fee of $469,200 payable at $3,400 per residential Unit for 138 units at the time of issuance of building permits. The proposed Amendment to the March 11, 1988, Letter of Understanding, consistent with the language proposed by Joann Lehmer, reads as follows: "6. A 2 acre private park (the "Private Park") shall be created in conjunction with any future subdivision of Lot 13 of the Phase III Map, and improved at the Company's sole cost and expense, to replace the neighborhood park that was formerly to be located on Lot 16 of the Phase Ill Map. In the event that the Private Park is not provided, the obligation to provide the private 2 acre park shall be satisfied in full by in-lieu payment ("the Fee") of $3,400.00 per single family residential unit based on the total number of dwelling units created. The fee shall be paid on a per unit basis on the total number of residential units created, subject to the following conditions: No credit will be given a builder for provision of any on-site recreational facilities in conjunction with development in order to offset or discount the required payment of the Fee. b. The City shall collect the Fee per unit payment at time building permits are issued by phase for the project. In the event that permits for all units have not been issued prior to May i, 1995, then the remaining balance of the in-lieu payment equal to the Fee per unit shall immediately become due and payable on May 1, 1995. Failure to make said remaining payment by May 1, 1995, will be considered late and the City shall affix an annualized penalty fee of 15% computed on a daily basis on the unpaid balance. 550 f4(;v,.'!:~on Cenler Dm.,o. P.O. Box I. Newl'xod Beach. Calif()~nia 92658-8904 - (714) 720-2000 William A. Huston City of Tustin 10/6/ 1993 Page 2 City will commit to spend funds collected under this agreement for recreation facilities in Tustin Ranch but City makes no commitment as to timing of said expenditures or specific facilities to be funded. d. It is mutually agreed that the in-lieu payment of the Fee does not constitute any precedent for any purpose other than this agreement as to the amount of any future local park fees, establishment of land values or other related issues." Bill, we need your approval and ratification by the City Council as soon as possible in order to not delay the issuance of building permits for the project. Please do not hesitate to contact me should you have any additional comments or questions. Very truly yours, THE IRVINE COMPANY C. Keith Greer Senior Vice President park3/CKG '.l~'.hrk APPROVED AND ACCEPTED William A. Huston City Manager City of Tustin C' Christine Shingleton, City of Tustin Joann $. Lehmer, City of Tustin Jon Robertson, California Pacific Homes 4043.4.0