BACKGROUND:
Tentative Tract Map No. 28561, for the development of a 276 single family lot Planned Unit Development (PUD 97-4) in the Rio Del Sol area, was approved by City Council in September 1997. The PUD was on a 50 acre parcel of Indian allottee land, located south of Gerald Ford Drive, opposite Plumley Road.
The first increment of this map, Tract 28561-1, of 127 lots, was recorded in September 2002, by the lessee subdividers. In October 2003, the same subdividers recorded the second and final increment of this tentative map of 159 lots, Tract 28561. This second map re-subdivided several lots within the first map, and after several lot line adjustments and mergers, a total of 270 lots were available for development.
The original subdividers experienced financial difficulties and market problems, and construction stopped. As a result, the required street and infrastructure improvements were only partially completed, and the original subdividers eventually were foreclosed upon and lost the property.
The remaining vacant lots of the unfinished tracts went through several bank ownerships, meanwhile, several private developers made attempts to revive the development, but none were successful in moving a project forward. A total of 56 lots were eventually completed with single family homes.
Over a period of time, Holt Opportunity Fund (Parallel-1), 2013, LP, a Delaware limited partnership (“Holt”), eventually assumed the subleases on all the vacant lots, and Holt has been working diligently on plans to complete the original PUD development by building out the vacant lots in four phases, which they refer to as Montecito (57 lots), Palazzo (73 lots), Espana (28 lots) and Elements (56 lots).
Holt executed two Improvement Agreements in October 2019, one for the Montecito area and one for the Palazzo area.
Holt recently made a business decision to transfer all its holdings in Rio Del Sol to RDS Development, LLC, a California limited liability company (RDS), a wholly owned subsidiary of Holt. Since this involved Indian allottee land, approval of this transfer and modification of the Indian business leases required the approval of the Bureau of Indian Affairs (BIA). This transfer and approval also took some time and was finally approved by the BIA.
Holt and RDS have executed Assignment and Assumption Agreements for the two existing Improvement Agreements, which are the subject of a separate Staff Report item for City Council approval this same evening.
DISCUSSION:
RDS has now executed two new Improvement Agreements for the remaining Espana and Elements areas of Rio Del Sol. In these Agreements, RDS agrees to complete the missing public and private improvements in these two phases within 24 months of the City Council approval of these Agreements and prior to the issuance of occupancy permits on all the new homes proposed within each phase. The improvements consist generally of the capping, repair or construction of private streets, installation of sewer and water systems, utilities, drainage systems, landscaping and irrigation and the setting of final survey monuments and property corners.
As was done for the DR Horton Project in the Rio Vista/Verano area, these two new Improvement Agreements provide for improvement securities to be posted prior to the City’s issuance of a Certificate of Occupancy on any of the lots in either phase. The two new Agreements are very similar to the City’s Standard Subdivision Agreement, except that the Tract Maps have already been recorded.
Environmental Summary:
It has been determined that since the approval of the original CEQA Negative Declaration for this Tentative Tract and PUD, there have been no substantial changes to the overall project, no new significant environmental effects, no substantial increase in the severity of any previously identified impacts and no new information of substantial importance which would modify the conclusions reached in the original Negative Declaration.
Staff is requesting that the City Council approve the Improvement Agreement with RDS Development, LLC, for improvements in the Espana village portion of the Rio Del Sol development; and approve the Improvement Agreement with RDS Development, LLC, for improvements in the Elements village portion of the Rio Del Sol development; and, authorize the City Manager and City Clerk to execute the Agreements on behalf of the City in a form approved by the City Attorney.
FISCAL IMPACT:
There is no fiscal impact to the City as a result of this action.