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HomeMy WebLinkAboutSPEC 01 TUSD INTNT LTR 06-06-05 Inter-Com DATE: June 2, 2005 FROM: Honorable Mayor and Members of the City Council William A. Huston, City Manager ~ Letter of Intent Between the City and the Tustin Unified School District (TUSD) TO: SUBJECT: The City Council and TUSD Board of Trustees is scheduled to hold a joint meeting on June 6, 2005 to consider the attached Letter of Intent. The Letter of Intent sets forth a framework for the City and TUSD to work together concerning new schools to be constructed at Tustin Legacy. Mayor Bone and Mayor Pro Tem Davert have met several times with a committee of the TUSD Board of Trustees to jointly prepare the Letter of Intent. A presentation covering the key provisions of the Letter of Intent will be provided at the joint meeting. S:IRDAITUSD memo from WAH, 6-2-05.doc Letter ofIntent By and Between the City of Tustin and the Tustin Unified School District A. Whereas the City of Tustin (the "City") and the Tustin Unified School District (the "District") agree that the development of schools is essential to the development of that portion of the former Marine Corps Air Station - Tustin ("Tustin Legacy") within the City, and the productive, efficient use ofthat land, and B. Whereas the City and the District agree that the proper siting and construction of schools on Tustin Legacy can increase the attractiveness of surrounding development on Tustin Legacy, and C. Whereas the City and the District agree the development of school facilities on two, 10 acre parcels, and a 40 acre high school site are appropriate for Tustin Legacy, and D. Whereas the City and the District acknowledge that the lead time for the approval process for the schools may take several years, and E. Whereas the City and the District acknowledge that the approval process for the school facilities has stages and that each ofthese stages carries with it significant costs requiring funds from sources outside of the District's operating budget, and F. Whereas the City and the District acknowledge that notwithstanding the fact that the school sites have been identified in the Record of Decision ("ROD") concerning the closure and reuse of Tustin Legacy and further acknowledge that these sites have been studied in the EIR related to Tustin Legacy which was certified and approved by the City in 2001, the boundaries of the two sites not yet granted to the District may need to be adjusted to accommodate the City's desires to MCAS-LOI-6/O5 S-JW develop the property or be adjusted due to the presence of contamination in the vicinity of the proposed sites or other school development constraints, and G. Whereas the City and the District agree that development of school facilities on Tustin Legacy can best be achieved by meeting the following benchmarks and objectives: 1. A comprehensive development approach for a K-12 school plan that can only be achieved through the cooperative planning ofthe District and the City; 2. Construction of a state-of-the-art new high school for the purpose of relocating the existing Tustin High School and construction of new school facilities on two 10 acre sites!; 3. A cost effective and efficient approach to build a new high school during the build out of the proposed Tustin Legacy development, including construction of the required infrastructure; 4. Control of timing, including ensuring that the existing Tustin High School remains operational until a new high school is opened; 5. The establishment of a financing program to fund site development and construction of a new high school and to construct facilities at the two 10 acre sites through cooperation ofthe City and the District, which will include District sponsored Community Facilities District financing (for all property within Tustin Legacy within the District), state funding, and developer fees, as well as the potential exchange of the completed new high school for the existing Tustin High School; ! Paragraph 12 of this Letter oflntent acknowledges that one of the 10 acre sites may be expanded to 15 acres. MCAS-LOI-6/O5 S-JW 2 6. Establishing a funding source from the City or other sources for Phase I environmental clearance and other due diligence studies necessary to evaluate the new high school site, and one 10 acre site, which may be subject to later reimbursement; 7. The City agreement to consider entitlement of the existing Tustin High School Site so that it can be privately developed; H. Whereas the City and the District acknowledge that the District cannot accept property without clearance from both the California Department of Toxic Substances Control and the California Department of Education concerning contamination, and 1. Whereas the City and the District both wish to develop joint use athletic facilities which are superior to existing facilities on or adjacent to the school facilities, and J. Whereas the City and the District wish to work in concert to achieve the best possible results for the reuse of Tustin Legacy for the benefit of all of the citizens ofthe City and the children of the District, therefore The City and the District agree as follows: 1. Within 30 days of the execution of this agreement, the City shall provide to the District the proposed final boundaries of the school sites. 2. Within 60 days of the execution of this agreement, the District shall provide to the City a timeline of tasks required to be undertaken for the approval of construction on the proposed school sites. This timeline shall not be binding upon the District, but rather to be used as a tool to integrate school funding timing issues with the development plans of the City. It is understood that MCAS-LQI-6/05 S-JW 3 many of the benchmarks in any such timeline will relate to the obtaining of certain approvals by other public agencies and are therefore outside of the District's control. 3. To foster better communication, the School Board and City Council agree to educate each other concerning the fiscal constraints of each entity through exchange of information which may include, but is not limited to, joint public meetings or workshops. 4. The City and the District intend to negotiate an agreement with each other and potentially with other parties which will create financing mechanisms, establish performance time tables, and detail respective obligations and responsibilities for school facilities at Tustin Legacy. 5. After receipt of the District's timeline, cost estimates and proposed revenue sources, the City and the District representatives shall meet to discuss the timeline and the anticipated timing of development at Tustin Legacy with the District, the full range of District-related funding sources for schools at Tustin Legacy and what further steps need to be taken to obtain such funding, including the proposed land exchange for the high school, and other issues such as joint use of facilities. The City and the District agree to negotiate in good faith an agreement on the funding of school facilities at Tustin Legacy and to cooperate on planning related to such school facilities. 6. The District acknowledges that the City has sole control over the selection of the master developer of the City's portion of Tustin Legacy. The District agrees that it will negotiate solely with the City concerning the siting of school facilities on Tustin Legacy. The City and the District acknowledge that it is likely that they will enter into three party contracts in the future related to the funding and construction of school facilities on the City's portion of Tustin Legacy. The City acknowledges that the District has construction funding options separate and apart from the reuse of Tustin Legacy and that nothing in this agreement shall prevent the District's pursuit of those MCAS-LOI-6/05 S-JW 4 funding options. The District acknowledges that the City will share information with its Developer partner(s) during this negotiation process. 7. In the event that the District determines that the sale, exchange, or transfer of the existing Tustin High School site to the City or the City's designee will be used to provide construction funding for school facilities within the District, then the District and the City shall negotiate a mechanism to determine the fair market value of the existing Tustin High School site. The parties acknowledge that the District requires that the existing Tustin High School site remain fully operational until such time as a new high school has been constructed on Tustin Legacy and has received all necessary approvals for operation. Accordingly, the City and the District acknowledge that any agreement for the sale, exchange, or transfer of the existing Tustin High School site will provide that construction of school facilities will be completed and all approvals received before the final sale or transfer will occur. 8. The City and the District agree to enter into an agreement to implement school facility financing, advancement of funds for due diligence requirements, investigations and studies, construction and financing matters, and to explore strategies to obtain, to the extent possible, state funding and other resources for school facilities construction. 9. The City and the District agree to explore and negotiate a mechanism for the construction of new school facilities. 10. The existing Tustin High School site is presently zoned as institutional. The City and the District acknowledge that the property will have to be rezoned to allow its highest and best private use feasible and compatible with surrounding uses. The City agrees to consider rezoning the property to maximize its reuse value. MCAS-LOI-6/O5 S-JW 5 11. The City and the District anticipate that they will work cooperatively to design and develop a strategy to develop school funding mechanisms to allow construction ,of the school facilities on Tustin Legacy that both maximize public benefit while enhancing the surrounding Tustin Legacy development. Accordingly, once a school facility funding mechanism has been approved, the City and District will cooperate in bringing a validation action, as allowed under California law, to confirm the legal validity of the selected funding mechanism. 12. The City and the District shall explore expanding the ten acre economic development conveyance site to 15 acres to allow Tustin Legacy to house middle school children. Agreed to by the Parties on June _,2005: City of Tustin By: Mayor Tustin Unified School District By: President MCAS-LOI-6/O5 S-JW 6