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HomeMy WebLinkAbout01 AGENDA REPORTG1m ObAGENDA REPORT �rSrt1 MEETING DATE: TO: FROM: SUBJECT: AUGUST 25, 2015 Agenda Item 1 Reviewed: City Manager _ Finance Director _ N1% HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL JEFFREY C. PARKER, CITY MANAGER APPROVE SCHOOL FACILITIES IMPLEMENTATION, FUNDING AND MITIGATION AGREEMENT WITH TUSTIN UNIFIED SCHOOL DISTRICT. APPROVE SITE CONVEYANCE AGREEMENT WITH TUSTIN UNIFIED SCHOOL DISTRICT. APPROVE JOINT COMMUNITY FACILITIES AGREEMENT WITH TUSTIN UNIFIED SCHOOL DISTRICT AND STANDARD PACIFIC CORPORATION. AUTHORIZE CITY MANAGER TO EXECUTE ALL AGREEMENTS AND ANY OTHER DOCUMENTS NECESSARY TO IMPLEMENT THE AGREEMENTS CONSISTENT WITH THE CITY COUNCIL'S APPROVALS, INCLUDING THE GRANT DEED CONVEYING SITE NO. 2 OR AN ALTERNATIVE SITE, TO TUSTIN UNIFIED SCHOOL DISTRICT. SUMMARY: In 2013, the City and the Tustin Unified School District (TUSD) reinstated discussions on how to establish a financial plan, development plan, and implementation schedule for 6-12 schools within Tustin Legacy. Approval of the school facilities implementation, funding and mitigation agreement, the approval of the site conveyance agreement, and the joint community facilities agreement with TUSD and Sty--ndard Pacific will provide the framework for development of grades 6-12 schools on the 40 -acre designated site, along with the opening of Heritage Elementary School as a magnet elementary site in the fall of 2016. RECOMMENDATION: 1) The City Council approve Resolution 15-54, attached hereto as Exhibit 1, authorizing the City Manager to execute all agreements and documents referenced therein, including conveying site No. 2, or an alternative site, to TUSD as and when required by the agreements. 2) Appropriate $4 million of funds from land sale proceeds or CFD 14-1 bond proceeds to meet our October 2015 timeline to ensure Heritage Elementary is opened for the 2016-17 school year. FISCAL IMPACT: The financing of this K-12 project comes from three (3) primary sources. TUSTIN UNIFIED SCHOOL DISTRICT August 25, 2015 Page 2 1. All development fees paid to TUSD from Legacy development projects, 2. Community Faculty Districts (CFDs) that address mitigation requirements to provide schools, and 3. Funds in lieu of transferring a 10 -acre site previously designated for another elementary school that would no longer be conveyed since it is no longer needed for an additional school site. The estimated cost of the complete project is $75,117,850, consisting of the following: a. $47.5 million for the 9-12 school would include classrooms, administrative office, kitchen/cafeteria, gym/activity center b. $18 million for the 6-8 school site c. $3 million for pre -construction site work d. $6.5 million for Heritage expansion (which will only be required in the event of full build -out of the Tustin Legacy area) In order to facilitate this implementation plan, the City will advance funds to the project development account with three (3) different approaches. The first City contribution would be $4 million by the end of October 2015. This money will be used in conjunction with funds already collected by TUSD for school design and construction documents to be submitted to the California Department of the State Architect for approval. In exchange for the $4 million contribution, TUSD will open and operate Heritage Elementary School by the start of the 2016-17 school year and TUSD will commence and complete conceptual site planning and preliminary design to potentially advance the construction and opening of the 6-12 projects. This funding will come from CFD 14-1. Second, the City will deposit in the project development account $15 million by May 2016 and upon such occurrence, TUSD waives any and all interest it has in the additional 10 -acre school site in the Legacy development. The $15 million would be utilized for construction on the 40 -acre site, which will be designed to include the gym/activity center. Once constructed, the gym/activity center will be subject to a joint use agreement allowing City and public uses during non -school hours. Third, once construction bids are received for the 6-12 school project, the City will have the option to advance additional funds for the construction of the entire 6-12 school project or just the 9-12 high school project. Although more expensive for the City TUSTIN UNIFIED SCHOOL DISTRICT August 25, 2015 Page 3 initially, this option will reduce overall cost by financing and constructing the project earlier and thus reducing the impact of future construction cost increases. The advance would be made after TUSD receives State approval, and we have actual bid cost. Provided sufficient funds remain after the school is constructed, this advance would be reimbursed to the City by the future TUSD/CFD 15-2. BACKGROUND: In 1996, the MCAS Tustin Reuse Plan was approved. That plan designated proposed land to be conveyed to TUSD to provide property to be used to serve the student population from the base area. In 2012, after years of recession and extensive planning, the City restarted on the process of disposition and development of the Legacy. Later, the City and TUSD started dialogue addressing the community's desire to the see the opening and construction of K-12 schools for the Legacy area. Critical to developing a workable plan was deciding what type of schools to develop and the financial plan to accomplish it. Another key element was calculating future student population. In 2013, the City started to evaluate changes to the specific plan for the Legacy development while moving forward with its first residential projects in several years. These actions, along with citizens already residing in the Legacy area who want to see local schools for their neighborhoods, spurred the City and TUSD to work on a new plan to facilitate funding and construction of K-12 schools in the Legacy project area. Those discussions have resulted in the recommended agreements attached hereto as Exhibits 2 through 5. GENERAL PLAN CONFORMITY: At its May 12 meeting, the Planning Commission reviewed the proposal to develop the 40 -acre TUSD school site and the determination that the additional 10 -acre site was no longer necessary to serve the students generated by the developments in the Legacy project area. Attached as Exhibits 6 and 7 respectively are the Planning Commission Resolution and letter from TUSD regarding the 10 -acre site. CORRELATION TO THE STRATEGIC PLAN: Goal A: Economic and Neighborhood Development. Specifically, the project implements Strategy 1(f), coordinate development with other public agencies. Additionally, this project TUSTIN UNIFIED SCHOOL DISTRICT August 25, 2015 Page 4 contributes to Goal D• Strong Community and Regional Relationships. Specifically, this project implements Strategy 2, continue to work collaboratively with agencies within and outside Tustin on issues of mutual interest and concern (e.g., Tustin Unified School District). G 'aity Manager 1. City Council Resolution No. 15-54 2. School Facilities Implementation, Funding and Mitigation Agreement 3. S'te Conveyance Agreement 4. Joint Community Facilities Agreement 5. Grant Deed conveying Site No. 2 to Tustin Unified School District 6. Planning Commission Resolution No. 4282 7. Letter from Tustin Unified School District regarding 10 -Acre Site