Staff Report
City Council
Item No. 3.H
Meeting Date: May 27, 2026
From: John A. Corella, Director of Public Works
Title: Adopt a Resolution Accepting Public Improvements and Certifying Completion of Private Improvements in Parcel Map 37876 (PUD 21- 001): Cathedral Cove 1.0, LLC Developer (Fountainhead).
RECOMMENDATION:
City Council adopt a Resolution accepting the public improvements and certifying completion of private improvements for Parcels 1, 2, 3, 4, and 5 of Parcel Map 37876 and PUD 21-001; authorizing the release of Improvement Agreement Securities as described in the Resolution; and authorizing the Director of Public Works to file a Notice of Completion for the project.
BACKGROUND:
Parcel Map 37876 and Planned Unit Development (PUD) 21-001, a Zoning Code Amendment, and several conditional use permits were approved by the City Council in September 2022, for the division of approximately 13.9 acres of land into nine (9) parcels, and the phased improvement of eight (8) parcels into a mixed-use commercial development.
These parcels are all located on vacant land on the south side of East Palm Canyon Drive, east of Van Fleet Avenue. The vacant land was acquired from the City Urban Revitalization Corporation (CURC), by the owner/developer, Cathedral Cove 1.0, LLC, also known as Fountainhead Development 2.0, LLC.
The onsite development includes drive-thru restaurants, a fuel station with a convenience market, and a future pad for a single or multi-tenant use, complete with on-site driveways, parking lot, utility and drainage improvements, and other infrastructure.
Public improvements included the widening of the south side of East Palm Canyon Drive, traffic signal modifications at Allen Avenue and Date Palm Drive, median island restorations, frontage REAS work and restriping that allowed the re-opening of Date Palm Drive south of the East Palm Canyon Drive intersection. Desert Water Agency (DWA) sewer and water extension improvements were also required.
The owner/developer has executed and recorded covenants which remain on title (will run with the land), which will require the owner to pay for the electrical energy for the street lights along East Palm Canyon Drive frontage, and for the maintenance of the new Date Palm Drive entrance into the development.
When the Final Map of Parcel Map 37876 was approved by City Council, the developer executed an Improvement Agreement related to Parcels 1, 2, 3, 4 and 5 and posted improvement securities in the form of corporate surety bonds, as authorized by the State Subdivision Map Act. The agreements and securities were posted to guarantee the completion of the public and private improvements related to the development of Parcels 1, 2, 3, 4 and 5 of the Parcel Map.
All the required improvements for Parcels 1, 2, 3, 4 and 5 of the Parcel Map and PUD have been satisfactorily completed as required by the Improvement Agreement. DWA has approved the water and sewer improvements.
DISCUSSION:
A Notice of Completion (NOC) has been prepared and will be filed by the Director of Public Works upon approval of the Resolution, noting that all the improvements have been completed. No claims have been filed with the city against any of the posted securities.
Pursuant to State law, the surety bond guaranteeing payment for labor and materials posted with the Improvement Agreement will be released by the Director of Public Works ninety (90) days after recordation of the Notice of Completion.
The developer has posted a $157,890.00 one-year warranty bond to guarantee repair of any defects in materials or workmanship in the public and private improvements within the development envelope. This warranty bond will be released by the Director of Public Works one year after adoption of this Resolution provided no claims have been filed or challenges arise due to defects with materials or workmanship.
DWA required their own warranty security for the public sewer and water improvements and as such, the city did not require warranty bonds for these facilities.
The developer was required to post cash security to guarantee placement of all required survey monuments and property corners related to Parcels 1, 2, 3, 4 and 5. This work has been completed to the satisfaction of the City Engineer and certified by the Surveyor of Record and as a result of the foregoing, the cash bond has been released by the terms of the Improvement Agreement.
The securities posted by the developer to be released in accordance with the terms of the Improvement Agreement and as outlined in the Resolution are as follows (note that all the surety bonds are from Philadelphia Indemnity Insurance Company):
Parcels 1, 2, 3, 4 and 5 related to Parcel Map No. 37876:
Public and Private Improvements:
For faithful performance: $1,578,900.00 Bond # PB 00621100105 For labor and materials: $ 789,450.00 Bond # PB 00621100105 Water Improvements:
For faithful performance: $102,000.00 Bond # PB 00621100106 For labor and materials: $ 51,000.00 Bond #PB 00621100106 Sewer improvements:
For faithful performance: $282,283.00 Bond #PB 00621100107 For labor and materials: $141,141.00 Bond #PB 00621100107 FISCAL IMPACT:
There will be minimal fiscal impact upon the city due to the adoption of this Resolution and the additional and/or improved public improvements.
The private improvements within the development and certain public improvements will be maintained by the owners and/or by the established Parcel Map’s owner’s association.
FIVE-YEAR STRATEGIC PLAN:
Goal B - COMMUNITY INVESTMENT
Objective: Cathedral City roads, gateways, public spaces, and other infrastructure are well planned, designed, constructed and maintained.
ATTACHMENTS:
1. Vicinity Map of Parcel Map 37876
2. Resolution
3. Notice of Completion