CITY OF MENIFEE
SUBJECT: Proposed amendment to the Development Agreement with Pulte Home Company, LLC. for the Cimarron Ridge
Development (Cimarron Ridge Specific Plan)
MEETING DATE: December 10, 2024
TO: Finance Committee
PREPARED BY: Margarita Cornejo, Deputy Finance Director REVIEWED BY: Travis Hickey, Chief Financial Officer
APPROVED BY: Armando G. Villa, City Manager
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RECOMMENDED ACTION
1. Review the proposed Amendment No. 3 for the existing Development Agreement (“DA”) between the City of Menifee and Pulte Home Company, LLC. dated June 7, 2017, for the Cimarron Ridge Development and recommend submittal to the City Council for approval.
DISCUSSION
The City of Menifee and Cimarron Ridge, LLC entered into a DA for the Cimarron Ridge project on June 7, 2017. Pulte Home Company, LLC., subsequently is the successor-in-interest to the rights and obligations of Cimarron Ridge, LLC. related to the DA. In May of 2023, a Minor Amendment to the DA was executed to adjust the timing of completion of specific travel way improvements. Most recently, on April 3, 2024, the City Council approved Amendment No. 2 to update provisions related to the community park relocation to Planning Area 4.
On October 28, 2024, Pulte Home Company, LLC. submitted an application for Amendment No. 3 to the DA to allow for the following:
•Adjust timing of the completion/construction of the Community Park from the issuance of 485 building permits to the issuance of 635 building permits •Allow for 20 occupancies (home closings) within Planning Area 6 prior to completion of McLaughlin Road improvements
•Additional community benefit to construct an interim connection of the Valley Boulevard missing link from just south of Chambers Avenue to connect to McCall Boulevard (anticipated $300,000 fiscal impact/benefit)
City of Menifee Staff Report
Proposed amendment to the Development Agreement with Pulte Home Company LLC. for the Cimarron Ridge development (Cimarron Ridge Specific Plan) December 10, 2024
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Pulte Home Company, LLC. is requesting a deferral of the park construction timing based on the timing of the previously approved DA amendment #2 to relocate the park from Planning Area 5 to Planning Area 4. The construction plans could not be completed and processed for review by City staff until after the Council approval of the new park location. Plans have been reviewed and are anticipated to be approved early next year (approximately March 1, 2025). The developer anticipates a 12-month construction period and has committed to begin construction immediately following plan approval. Allowing for unforeseen issues, staff recommends requiring the park be completed no later than June 1, 2026 and open to the public. No changes or removal of previously agreed upon park amenities are proposed. While the change from the 485th building permit (64% of total project) to 635th building permit (84% of total project) is higher/later in the development process than what has been standard for master planned communities in Menifee, the developer has provided the necessary bonding for the park and has committed to move forward expeditiously. Should the amendment not be approved, the project would be subject to delays in production. Currently, approximately 376 building permits have already been issued. As it relates to occupancies, in general we estimate that 635 building permits equates to 535 occupied homes.
In addition, Pulte is requesting an allowance of 20 home closings/occupancies within Planning Area 6 prior to the completion of the improvements on McLaughlin Road. The applicant has experienced construction delays and anticipates completion by March 2025 with homes to be completed and ready for sale in February 2025.
Associated with the above requests, Pulte has included an additional community benefit to construct a 730-foot section of Valley Boulevard from just south of Chambers Avenue to connect to McCall Boulevard (‘missing link’). The roadway would be constructed in an interim configuration and is proposed to include a 32-foot roadway section to match the current roadway south of McCall Blvd., with 8” AC berms on each side of the roadway. No sidewalks would be constructed as there are no sidewalks to connect to south of McCall. In order to facilitate this improvement, the City would need to acquire the necessary right of way from one property owner.
Staff recommends the construction of the missing link to be completed by December 2025, with allowable reasonable extension should the City experience delays in acquiring the right of way Upon review and recommendation by the Finance Committee, the proposed Amendment No. 3 would be presented for City Council consideration.
FISCAL IMPACT
Should the proposed amendment be approved, the right-of-way acquisition to facilitate the interim Valley Boulevard missing link roadway connection would be the City’s responsibility.
This project is included in the City’s Capital Improvement Program as CIP 22-02: Valley Boulevard Widening and Missing Links and funds for ROW acquisition have been allocated within accounts 2526-55-PWD-CIPS-760000 and 2415-55-PWD-CIPS-760000.
City of Menifee Staff Report
Proposed amendment to the Development Agreement with Pulte Home Company LLC. for the Cimarron Ridge development (Cimarron Ridge Specific Plan) December 10, 2024
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ATTACHMENTS
1. Proposed Amendment No. 3 to Development Agreement
2. Executed Amendment No. 2 to Development Agreement
3. Executed Amendment No. 1 to Development Agreement
4. Executed Cimarron Ridge Development Agreement