Rancho Cordova City Council
February 21, 2023

I NSTITUTE for LOCAL S ELF GOVERNMENT Ÿ C OMMUNITY LAND U SE P ROJECT | 23

SUMMARY
This chapter has examined the advantages of the three defining characteristics of development agreements—greater regulatory latitude, flexibility and assurance for project proponents. But these characteristics can also present obstacles for the parties negotiating a development agreement.

Some developers may continue avoiding the use of development agreements becau se of the potential for expensive project requirements.

Some local agency staff may avoid development agreements because of the limitations that development agreements impose on an agency’s ability to respond to a changing regulatory environment. Nevertheless, the latitude afforded by development agreements to advance local agencies’ planning objectives--in sometimes new and innovative ways--makes the development agreement a useful and viable tool in service to the community in a number of different applications.

For both parties, a development agreement can involve a great deal of time and energy to negotiate and implement. Accordingly, it is important at the outset to carefully evaluate the advantages and disadvantages of using a development agreement in each specific instance.

ITEM 11.1.

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24 | D EVELOPMENT A GREEMENT M ANUAL

ITEM 11.1.

ATTACHMENT 1

ACHIEVING LAND USE

PLANNING OBJECTIVES

THROUGH DEVELOPMENT

AGREEMENTS
Development agreements can be used for a wide range of projects, from large mixed-use developments to smaller projects. Moreover, the scope of a development agreement can vary according to the needs of the project in question. Although a development agreem ent can be comprehensive, detailing every aspect of the project, it can also focus on particular aspects of a project.

This chapter discusses the role that development agreements can play in a local agency’s overall planning process. Fundamentally, development agreements are one tool in the local agency’s toolbox for achieving the community’s long-term planning and development goals.

THE IMPORTANCE OF COMPREHENSIVE

PLANNING
In authorizing the use of development agreements, the Legislature emphasized that development agreements are intended to serve as a tool to strengthen a community’s commitment to comprehensive land use planning.32 The concept behind the use of development agreements is to encourage communities to think ahead, in a comprehensive manner, about the impacts of development within their jurisdiction and the steps necessary to make that development a win -win proposition for both the project proponents and the community.

32 See Cal. Gov’t Code § 65864(a) (“The Legislature finds and declares that: (a) The lack of certainty in the approval of development projects can result in a waste of resources, escalate the cost of housing and other development to the consumer, and discourage investment in and commitment to comprehensive planning which would make maximum efficient utilization of resources at the least economic cost to the public.”) (emphasis added).

The Importance of
Comprehensive Planning ........... 25

Uses of Development
Agreements................................... 28

Summary ...................................... 28

3 C HAPTER
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26 | D EVELOPMENT A GREEMENT M ANUAL
A development agreement generally allows a project proponent to proceed with a project that meets the “policies, rules and regulations” in effect at the time the development agreement is approved.33 A development agreement may also supercede an agency’s existing policies, rules and regulations, as long as the project is consistent with the general plan and any applicable specific plan. 34

THE ROLE OF PLANNING POLICIES IN THE

NEGOTIATION PROCESS
A helpful starting point is having well-understood planning regulations that reflect the community’s current and anticipated needs. Such policies, when adhered to, facilitate the negotiation process, ensuring that a proposed development agreement refle cts the local governing body’s policies. This approach can also address a source of decisionmaker discomfort with the development agreement process, because even though the governing body ultimately approves a development agreement, it also needs a mechanism to provide direction to the negotiation process. Planning policies meet this need.

Typically in a negotiation process, decisionmakers provide their negotiators with parameters on key bargaining issues. It is important that the parameters remain confidential, so the other side does not know how much leeway the negotiators have.

Confidentiality is difficult in the context of development agreement negotiations because the state’s open meeting laws35 do not generally allow an exception for public agency negotiators on development agreements to receive direction from the governing body. There may be aspects of a development agreement—for example, the price and terms of payment for acquisition of property—that can be discussed in closed session. However, only those issues may be discussed in closed session—not the development agreement in general.

The agency’s planning policies, therefore, may serve as the negotiators’ key source of direction in this circumstance. In addition, a local agency may want to consider directing its staff to adopt a different type of negotiating style, where identification of “interests” replaces the need to establish outer

33 See Cal. Gov’t Code § 65864(b) (“The Legislatu re finds and declares that: … (b) Assurance to the applicant for a development project that upon approval of the project, the applicant may proceed with the project in accordance with existing policies, rules and regulations, and subject to conditions of approval, will strengthen the public planning process, encourage private participation in comprehensive planning, and reduce the economic costs of development.”) (emphasis added). See also Cal. Gov’t Code § 65866.
34 See Cal. Gov’t Code § 65867.5.
35 See generally Cal. Gov’t Code § 54950 and following (The Ralph M. Brown Act).

WHAT D OES A

D EVELOPMENT

A GREEMENT
C OVER?
• Permitted uses of the
property;
• Density or intensity
of use;
• Maximum height and
size of proposed
buildings;
• Provisions for
reservation or
dedication of land for
public purposes;
• Terms and
conditions relating to
financing of
necessary public
improvements, as
well as provisions for
subsequent
reimbursement for
that financing, as
appropriate;
• Timeframes for
commencement and
completion of
construction, or any
phases of
construction;
• Subsequent
discretionary
approval provisions,
as long as those
approvals do not
prevent development
of the project as
described in the
agreement; and
• The duration of the
agreement.

ITEM 11.1.

ATTACHMENT 1

I NSTITUTE for LOCAL S ELF GOVERNMENT Ÿ C OMMUNITY LAND U SE P ROJECT | 27 “positions” or parameters (see discussion in Chapter 4). If an agency uses an interest-based negotiating strategy, there are fewer strategic disadvantages associated with a governing body’s trying to provide direction in open session.

Well-conceived and up-to-date planning policies can also assist local agencies to avoid having to ask the staff to negotiate in a vacuum, with little or no immediate direction or feedback from decisionmakers. When the agreement is before the legislative body for final approval, it may be difficult for the body to modify aspects of the agreement without, in effect, renegotiating the agreement from the dais to change the terms that the staff negotiated.

D EVELOPMENT A GREEMENTS AND

A NNEXATIONS /INCORPORATIONS
The development agreement law provides that cities generally inherit development agreements negotiated by counties for newly incorporated or newly annexed areas. See Cal. Gov’t Code § 65865.3(a) (for incorporations, the effective date of the incorporation must be after January 1, 1987). The development agreement must meet the following requirements, however:
• The application for the agreement must have been submitted before the first signature was placed on the petition for annexation or incorporation (or resolution initiating such proceedings); • The agreement must have been entered into prior to the incorporation/annexation election (or prior to the date on which the conducting authority ordered the annexation); and • The annexation is initiated by the city (or, if initiated by someone else, the city does not adopt written findings that the development agreement is injurious to the health, safety or welfare of city residents. See Cal. Gov’t Code § 65865.3(c) and (d).

The duration of such inherited development agreements is the duration of the agreement or eight years, whichever is shorter. See Cal. Gov’t Code § 65865.3(a).

The city may modify or suspend the development agreement’s provisions if the city determines that failure to do so would place the residents of the territory subject to the development agreement (or the residents of the city in general — or both) in a condition dangerous to their health or safety (or both). See Cal. Gov’t Code § 65865.3(a).

However, the development agreement law also authorizes cities to enter into development agreements for unincorporated territory within their sphere of influence. See Cal. Gov’t Code § 65865(b). The agreement does not become operative until the annexation occurs. See Cal. Gov’t Code § 65865(b). The timeframe for the annexation must be specified in the agreement and the annexation must occur within that timeframe. See Cal. Gov’t Code § 65865(b). Extensions are possible, however. See Cal. Gov’t Code § 65865(b).

ITEM 11.1.

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28 | D EVELOPMENT A GREEMENT M ANUAL

PLANNING POLICIES AS A MECHANISM FOR DEFINING

PROJECT PROPONENT EXPECTATIONS
An agency’s planning documents, including its local development agreement procedures, can provide an important source of guidance for project proponents going into negotiations. By stating in the procedures that the local agency is committed to using development agreements as a tool to promote the community’s needs, the agency makes clear that it expects to receive greater community benefits than it could otherwise achieve through the land use regulatory process. This level of understanding can be helpful in setting the proper tone, so both parties have realistic expectations going into the negotiations.

Such an approach also may be helpful in responding to community concerns that the community has not received adequate benefits in the past from development agreements. These concerns may arise, especially when the project proponent has an ongoing relationship with the public agency.

USES OF DEVELOPMENT AGREEMENTS
Local g overnment agencies have successfully used development agreements to facilitate:
• School, park and other facility funding;
• Affordable housing projects;
• Large-scale mixed use projects; and
• Multi-phase commercial projects.

Development agreements can also be a vehicle for addressing concerns among developers about perceived adverse impacts of neighboring projects.

SUMMARY
Used judiciously, development agreements are a useful tool for achieving an agency’s land use planning objectives. Well-articulated planning policies

36 Cal. Gov’t Code § 14045.
37 Cal. Gov’t Code §§ 65460.10, 65460.2.
38 Cal. Gov’t Code § 65913.5

D EVELOPMENT

A GREEMENTS AND

T RANSIT
Development agreements
may be used to implement
demonstration programs
that test the effectiveness of
increasing the density of
residential development in
close proximity to mass
transit stations. 36 Local
agencies may also require
developers to enter into
development agreements to
implement density-bonus
programs in transit village
plans 37 or within a half-mile
radius of mass transit
stations. 38
ITEM 11.1.

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I NSTITUTE for LOCAL S ELF GOVERNMENT Ÿ C OMMUNITY LAND U SE P ROJECT | 29 may also provide important policy direction to staff in negotiating such agreements.

ITEM 11.1.

ATTACHMENT 1

THE NUTS AND BOLTS OF

PROCESSING

DEVELOPMENT

AGREEMENTS
From a local agency standpoint, the development agreement process begins with the local agency’s procedur es for development agreements. The development agreement law contemplates the adoption of such procedures by local government agencies.39 If there are none, some must be adopted upon the request of an applicant. 40 Sample procedures are available online at www.ilsg.org/devtagmt
and typically include the following:
• A statement of purpose/findings concerning the public benefits of development agreements;
• Application requirements;
• Notice and hearing
procedures;
• Planning commission and
governing body review;
• Recordation;
• Amendment and
termination; and
• Periodic review.

39 See Cal. Gov’t Code § 65865(b) (“Every city, county, or city and county, shall, upon request of an applicant, by resolution or ordinance, establish procedures and requirements for the consideration of development agreements …”).
40 See Cal. Gov’t Code § 65865(b).

Purpose/Findings ........................ 31
Application Process...................... 31
Public Hearings and Notice ........ 32
Decisionmaker Input on
Development Agreement and
Findings ........................................ 36

Recordation and Other Post-
Approval Steps.............................. 39

Amendment .................................. 40
Development Agreements and
Accountability .............................. 40

Summary ...................................... 41

ITEM 11.1.

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I NSTITUTE for LOCAL S ELF GOVERNMENT Ÿ C OMMUNITY LAND U SE P ROJECT | 31 Such procedures may be adopted by ordinance or
resolution.41 The development agreement law
allows local agencies to recover the direct costs
associated with adopting procedures for the
agencies’ consideration of development
agreements.42
This chapter discusses procedures and issues an
agency may include in its development agreement
procedures resolution or ordinance, as well as the
general steps in the process of approving a
development agreement.

PURPOSE/FINDINGS
The agency’s development agreement procedures provide an opportunity for the local agency to state its goal for considering development agreement requests, which is “…to promote the community’s needs and receive greater community benefits than otherwise can be achieved through the land use regulatory process.” A goal statement similar to this example can be helpful in setting the tone for negotiations, so that both parties have realistic expectations going into the negotiations.

It is also helpful to refer to the development agreement statute, Califor nia Government Code section 65864 and following.

APPLICATION PROCESS
An application form specifying the type of
information an agency needs to process the
development agreement request is an efficient
way of ensuring that the agency receives all of
the information it needs in a timely manner. Some
development procedures authorize the agency’s
planning director to develop a form application for
development agreements. A sample form is also
available online at www.ilsg.org/devtagmt
.

It can also be helpful for an agency’s
development agreement procedures to authorize the local agency’s attorney to develop a form agreement. Having a readily available form agreement saves staff time in reviewing development agreements; it also provides

41 See Cal. Gov’t Code § 65865(b).
42 See Cal. Gov’t Code § 65865(d).

WHO M AY I NITIATE

THE D EVELOPMENT

A GREEMENT
P ROCESS?
An owner (with legal or
equitable title) must apply in
accordance with the local
agency’s procedures. See Cal.

Gov’t Code § 65865(b).

See also National Parks and
Conservation Assn v. County
of Riverside, 42 Cal. App. 4th
1505 (1996).

O RDINANCE OR
R ESOLUTION?
Development agreements are
authorized both ways: by
ordinance and resolution. Some
public agency attorneys
recommend resolutions as the
more flexible form of
authorization.

ITEM 11.1.

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32 | D EVELOPMENT A GREEMENT M ANUAL
greater assurance that the agreement will cover all of the agency’s needs.

Chapter 6 discusses the content of development agreements. Sample forms are available online at www.ilsg.org/devtagmt
.

Some public agencies charge fees to process
applications. A local agency’s development
agreement procedures can specify those fees or
cross reference a fee schedule that includes this
particular type of fee.43
The local agency will also need to ensure that the
environmental analysis requirements under the
California Environmental Quality Act (CEQA)
have been satisfied.44

PUBLIC HEARINGS AND
NOTICE
Another important aspect of development
agreements is the role of public input. The
development agreement law requires a noticed public hearing by both the planning agency and by the local agency’s governing body before a development agreement is approved.45

DEVELOPMENT AGREEMENTS AND PUBLIC INPUT
Both the project proponent and the local agency have an interest in satisfying community concerns with respect to a development agreement, insofar as development agreements are subject to repeal by voter referendum.46 In fact, a development agreement cannot legally take effect until after the 30-day period for such a referendum expires.47 There is also a 90-day statute of limitations to challenge the adoption or amendments of any development agreement approved after January 1, 1996.48

43 See generally Cal. Gov’t Code § 66000(b) (excluding “fees collected under development agreements” from the type of fee covered under the Mitigation Fee Act) and following. 44 See generally Cal. Pub. Res. Code § 21000 and following. 45 See Cal. Gov’t Code § 65867.
46 See Cal. Gov’t Code § 65867.5.
47 See Cal. Elect. Code § 9141; Referendum Committee v. City of Hermosa Beach, 184 Cal.

App. 3d 152 (1986); Midway Orchards v. County of Butte, 220 Cal. App. 3d 765 (1990). 48 See Cal. Gov’t Code § 65009.

PROCESSING

D EVELOPMENT

AGREEMENTS WITH

OTHER A PPROVALS
Development agreements
may be processed with
other land use approvals
for the same project, such
as a conditional use permit
or subdivision map, in
which case the parties
should consider whether it
is advantageous to seek
simultaneous approvals, or
have one approval follow
another.

ITEM 11.1.

ATTACHMENT 1

I NSTITUTE for LOCAL S ELF GOVERNMENT Ÿ C OMMUNITY LAND U SE P ROJECT | 33 As a practical matter, though, it may be advisable to include stakeholders (interested parties such as community groups, business leaders and others interested in the community’s development) in the development agreement process. While it may not be practical to allow stakeholders to attend negotiations, it may be possible to consult with them ahead of time, or perhaps
on a
“meet
and
confer”
basis as
negotiatio
ns
proceed.

As the
following
example
illustrates,
the
process
of
negotiatin
g a
developm
ent
agreemen
t is
susceptibl
e to
“commun
ity backlash” in instances when community members find out after the fact, that public agency staff has agreed to recommend what they perceive as controversial concessions.

Meeting with stakeholders ahead of time to discuss possible actions, such as attracting a large retail outlet, allows legitimate issues to be aired before serious negotiations begin. After some evaluation, stakeholders may decide their issues can be resolved, or the agency may decide it should re-evaluate its priorities. In the case of the merchants in this illustration, had they been given the opportunity to meet with the agency to learn about the experiences of other cities, they might have concluded that attracting Taxco would actually help business retention.

I LLUSTRATION — TAXCO
Destination City is looking for a way to increase its general fund. Taxco is a large retail outlet that generates more than $500,000 worth of sales tax revenue each year for other cities in which it is located. Taxco plans to build a store in the vicinity.

Public agency senior staff meet with Taxco senior staff to discuss the benefits of locating in Destination City. Aware that a neighboring city would also like a Taxco retail outlet, these meetings are kept confidential. Senior staff suggest ways that Destination City may be able to write down land costs, waive development fees and otherwise provide incentives for Taxco to locate in their city. Eighteen months later, a deal is struck and the terms are commemorated in a development agreement, which is to be reviewed by the planning commission and approved by city council.

At this point, Bill Chamber, president of the Downtown Merchants Association, sees the public hearing notice and learns for the first time that the city is considering agreeing to a variety of incentives to entice Taxco to locate in Destination City. Mr. Chamber calls a meeting of the merchants.

During the meeting, merchants express their concerns that the city should not entice Taxco to locate in the city; it is not fair for the city to agree to monetary incentives not offered to other businesses; the city ought to be concerned about the very real threat that Taxco will run other merchants out of town; and the city should focus on business retention rather than attracting new businesses. The group decides to formally oppose approval of the development agreement. They also discuss initiating a recall of the enti re city council, for secretly acting against the business community’s interests. Unlike the Sports World illustration, these parties do not live happily ever after.

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34 | D EVELOPMENT A GREEMENT M ANUAL
Meeting and conferring with stakeholders during the negotiation process allows them to pro vide input on the specific terms and conditions that are being negotiated. Many times, the same underlying goal can be accomplished in a slightly different manner to accommodate stakeholders’ needs.

In the Taxco example, city staff needed to keep the
negotiations confidential, so that a neighboring city
would not undermine their efforts. While the need
for confidentiality makes it more difficult to include
stakeholders, including them in the process without
sharing every detail enables the local agency to be
on a firmer community relations footing when it
comes to approving the development agreement.

PUBLIC INPUT ON CONSIDERATION OF

THE PROPOSED AGREEMENT
The development agreement law specifies what kind
of public hearings and notice must be given when an
agency gets to the point of considering whether to
approve development agreements. 49 Hearings must
be held by the local planning agency and its
governing body.50 Such hearings are subject to the
state’s open meetings laws, 51 which require that all
interested persons be allowed to attend these
meetings52 and provide public comment before the
planning commission’s or governing body’s
consideration of the development agreement. 53
Members of the public are also entitled to request
copies of all documents included in the agenda
packet.54 The state’s Public Records Act also may entitle members of the public to request other documents relating to the proposed agreement.55

49 See Cal. Gov’t Code § 65867.
50 See Cal. Gov’t Code § 65867.
51 See Cal. Gov’t Code § 54950 and following.
52 See Cal. Gov’t Code § 54953(a).
53 See Cal. Gov’t Code § 54954.3.
54 See Cal. Gov’t Code § 54954.1.
55 See Cal. Gov’t Code § 6250 and following. An exception may be preliminary drafts of development agreements if they are not kept in the ordinary course of business. See Cal. Gov’t Code § 6254(a).

ON C ENTRAL

R ECOVERY OF
COSTS
Depending on the nature o f
the project, negotiating a
development agreement can
involve significant costs for
the public agency in the form
of staff time and legal fees.

An agency may want to
provide for the recovery of
some or all of those costs
either in its local procedures,
as part of the cost of
processing a development
agreement or as a term of the
agreement itself.

The agency will want to
ensure that it does not
assess the project proponent
more than the agency’s
actual costs. One way is to
establish an hourly rate and
regularly record staff time.

ITEM 11.1.

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I NSTITUTE for LOCAL S ELF GOVERNMENT Ÿ C OMMUNITY LAND U SE P ROJECT | 35

NOTICE ISSUES
The development agreement law provides notice requirements for hearings related to the potential adoption of a development agreement.56 The notice is the same as that required under the planning and zoning law for:
• Plans (publication in at least one newspaper of general circulation or posting in three public places within the jurisdiction if there is no newspaper of general
circulation, with special consideration given to drive - through facilities);57
• Projects (10-day mailed notic e to
the property owner, the project
proponent, affected local agency
service/facility providers; and 58
• Neighboring property owners
within 300 feet, as well as
published and posted notice, again
with special consideration given to
drive-through facilities). 59 The
agency must also give notice to
anyone who has requested it. 60
The notice must contain:
• The date, time, and place of the hearing;
• The identity of the hearing body;
• A general explanation of the matter to be considered
(in other words, the development agreement); and

56 See Cal. Gov’t Code § 65867.
57 See Cal. Gov’t Code § 65090.
58 This includes each local agency expected to provide water, sewage, s treets, roads, schools, or other essential facilities or services to the project, whose ability to provide those facilities and services may be significantly affected. See Cal. Gov’t Code § 65091(a)(2). 59 See Cal. Gov’t Code § 65091.
60 See Cal. Gov’t Code § 65092: “When a provision of this title requires notice of a public hearing to be given pursuant to Section 65090 or 65091, the notice shall also be mailed or delivered at least 10 days prior to the hearing to any person who has filed a written request for notice with either the clerk of the governing body or with any other person designated by the governing body to receive these requests. The local agency may charge a fee which is reasonably related to the costs of providing this service and the local age ncy may require each request to be annually renewed.”

A NOTE ON

D EVELOPMENT

A GREEMENTS IN

THE C OASTAL ZONE
Local agencies in the coastal
zone may approve
development agreements
only if they have a certified
local coastal program or if
the California Coastal
Commission formally
approves the development
agreement. See Cal. Gov’t
Code § 65869.

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36 | D EVELOPMENT A GREEMENT M ANUAL
• A general description, in text or by diagram, of the
location of the property that is the subject of the
development agreement, and hence the hearing.61
To facilitate informed public discussion of the matter, it may be helpful to include a brief explanation of what development agreements are. A sample of such a description is available online at www.ilsg.org/devtagmt .

DECISIONMAKER INPUT ON DEVELOPMENT

AGREEMENTS AND FINDINGS
A local agency’s development agreement
procedures present an opportunity for the
governing body to ask the planning commission to
make a recommendation on whether to ap prove
the agreement and weigh in on proposed findings.

INVOLVING THE PLANNING

COMMISSION EARLY ON
When development agreements are negotiated by
staff, subject to planning commission review before final approval by the legislative body, planning commissioners may feel they have been “left out of the loop.” This may be especially true if the legislative body is the only one receiving updates as negotiations proceed.

The consequen ces of the planning commission
feeling insufficiently involved may include:
• Bad feelings on the part of
individual planning
commissioners;
• A lack of planning commission
input during negotiations; and

61 See Cal. Gov’t Code § 65094.

C AN A

DEVELOPMENT

AGREEMENT BE

APPROVED BY
INITIATIVE?
Yes. See: Citizens for
Responsible Government v.

City of Albany, 56 Cal. App.
4th 1199 (1997).

WHAT

CONSTITUTES

ENTRY INTO THE

DEVELOPMENT
AGREEMENT?
The development
agreement law is not
entirely clear. A good
practice is to secure on the
agreement the signature of
the person authorized to
execute agreements on
behalf of the local agency
shortly after the adoption
of the development
agreement ordinance by the
governing body.

ITEM 11.1.

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I NSTITUTE for LOCAL S ELF GOVERNMENT Ÿ C OMMUNITY LAND U SE P ROJECT | 37 • Less protection of elected officials’ interests by
appointed commissioners.

One approach to informing the planning commission early on is to schedule the project for discussion at a regular planning commission meeting at the start of negotiations. This provides the planning commission with an opportunity to provide its input to the negotiating team on key policies and objectives to be achieved on behalf of the community through the development agreement.

Another approach is to convene a subcommittee of the planning commission as an adjunct to the negotiation process. If the subcommittee is less than a quorum of the commission, the discussion may occur without the overlay of open meetings requirements. 62 While the
subcommittee could be made part of the negotiating
team, it may be more practical, given the competing
demands on planning commissioners’ time, for staff to
confer with the subcommittee outside of negotiations.

This approach allows the negotiating team to benefit
from at least some planning commissioners’
perspective, while the negotiating team remains
reasonably sized.

PLANNING COMMISSION RECOMMENDATION AND

INPUT ON FINDINGS
An agency’s development agreement proced ures can solicit the planning commission’s input both on whether the development agreement should be approved, and on the findings accompanying any approval. Such findings may include whether the agreement:
• Is consistent with the objectives, policies, general land uses and programs specified in the agency’s general
plan and any applicable specific plan;
• Is consistent with the provisions of the agency’s zoning regulations;

62 See Cal. Gov’t Code §§ 54952.2(a) (“As used in this chapter, ‘meeting’ includes any congregation of a majority of the members of a legislative body at the same time and place to hear, discuss, or deliberate upon any item that is within the subject matter jurisdiction of the legislative body or the local agency to which it pertains.”) 54952 (“As used in this chapter, ‘legislative body’ means: … (b) A … committee … of a local agency, whether permanent or temporary, decision-making or advisory, created by charter, ordinance, resolution, or formal action of a legislative body. However, any advisory committee, composed solely of members of the legislative body which are less t han a quorum of the legislative body are not legislative bodies …”).

P RACTICE P OINTER
Some practitioners ask the
project proponent to sign
the proposed agreement
before the agreement is
introduced for approval.

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38 | D EVELOPMENT A GREEMENT M ANUAL
• Promotes the public health, safety, and general
welfare;
• Is just, reasonable, fair an d equitable under the
circumstances facing the agency;63
• Has a positive effect on the orderly development of
property or the preservation of neighboring property
values; and
• Provides sufficient benefit to the community to justify entering into the agreement.

GOVERNING BODY HEARING AND DECISION ON THE

DEVELOPMENT AGREEMENT
As discussed in Chapter 3, well-articulated planning policies and objectives should increase the likelihood that the staff’s and planning commission’s input to the development agreement negotiation process
produces a satisfactory agreement for the governing
body. Adoption of an interest-based negotiation
approach may also allow the governing body to
provide direction to negotiators early on in the
process in open session, consistent with the state’s
open meeting laws. 64
Well-conceived and up-to-date planning policies also
avoid the prospect of asking staff to negotiate in a
vacuum, with little or no immediate direction or
feedback from decisionmakers. This maximizes the
likelihood that the agreement presented for decision-
maker approval reflects their concerns and policy
direction. It m inimizes the likelihood of having to
renegotiate the agreement from the dias. (The
downside of which, is inclusion of language in the
agreement which may have unintended
consequences or not fully protect the agency’s
interests.)

63 See generally Morrison Homes Corp. v. City of Pleasanton, 58 Cal. App. 3d 724 (1976) (analyzing the “contracting away the police power” issue in the context of an annexation agreement). See also Denio v. City of Huntington Beach, 22 Cal. 2d 589 (1943); Carruth v. City of Madera , 233 Cal. App. 2d 688 (1965).
64 See generally Cal. Gov’t Code § 54950 and following (The Ralph M. Brown Act).

P RACTICE P OINTER
A development agreement
typically freezes regulatory
requirements in effect at the
time the agreement is
executed. For that reason, it
is helpful to collect all of
those regulatory documents
and file them with the
approved development
agreement. This avoids
confusion several years
afterwards as to what
regulatory requirements
apply.

Copies should also be
provided to the project
proponent.

ITEM 11.1.

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I NSTITUTE for LOCAL S ELF GOVERNMENT Ÿ C OMMUNITY LAND U SE P ROJECT | 39

ACTION ON THE AGREEMENT
The governing body must approve a development agreement by resolution or ordinance.65 Ordinances must go through a two-reading process, with at least a five-day intervening period.66 Changes require an additional five-day waiting period. 67

RECORDATION AND OTHER POST-

APPROVAL STEPS
After a development agreement is approved, the clerk of the governing body must:
• Record a copy of the development agreement within
10 days of the entity’s entry into the agreement, along with a description of the land subject to the
development agreement;68 and
• Publish the ordinance approving the development
agreement.69

65 See Cal. Gov’t Code § 65867.5.
66 See Cal. Gov’t Co de §§ 36934 (city requirements), 25131 (county requirements). 67 See Cal. Gov’t Code §§ 36934 (city requirements), 25131 (county requirements). 68 See Cal. Gov’t Code § 65868.5.
69 A clerk must publish each ordinance (or a summary of it) within 15 days afte r passage as follows: 1) In a newspaper of general circulation published within the jurisdiction, or 2) If there is none, by posting as required by state law. Cal. Gov’t Code §§ 36933 (cities), 25124 (counties) (note that state codes are available online at http://www.leginfo.ca.gov by clicking on
“California Law”). The publication must include the names of the governing body members voting for and against the ordinance. Cal. Gov’t Code §§ 36933(c) (cities), 25124 (counties).

ITEM 11.1.

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40 | D EVELOPMENT A GREEMENT M ANUAL
In cities and counties, failure to satisfy the publication requireme nt in a timely manner prevents the ordinance from taking effect or being valid.70

AMENDING THE DEVELOPMENT

AGREEMENT
After a development agreement has been signed, it may be amended only by mutual agreement of parties.71 Most development agreement procedures require amendments that are initiated by the project proponent to go through the same process as the initial application for the development agreement.

For local agency -initiated amendments, the procedures usually require notice to the project proponent a nd provision of information about the process that the agency will employ.

DEVELOPMENT AGREEMENTS AND

ACCOUNTABILITY
Fundamental to the concept of an enforceable agreement is the notion that each party will do what it promises to do in the agreement. To underscore that notion, the development agreement law requires local agencies to include at least an annual review of the project proponent’s compliance with the delineated responsibilities.72 The review must require the proponent to demonstrate good faith compliance with the terms of the agreement.73 If a local agency finds, based on substantial evidence, that such compliance has not occurred, the agency may modify or terminate the agreement. 74 In addition, the development agreement law provides that the development agreement is “enforceable by any party.” 75 A development agreement typically contains provisions specifying procedures for notice and termination in the event of a default by either party.

70 Cal. Gov’t Code § 36933(b) (cities). Cf. Cal. Gov’t Code § 25124(c) (providing failure of county clerk to publish means the ordinance does not take effect for 30 days). 71 See Cal. Gov’t Code § 65868.
72 See Cal. Gov’t Code § 65865.1.
73 See Cal. Gov’t Code § 65865.1.
74 See Cal. Gov’t Code § 65865.1.
75 See Cal. Gov’t Code § 65865.4.

P RACTICE P OINTER
Some agencies specify the agencies’
annual review procedures in the
agency’s ordinances and resolutions
relating to development agreements
Others specify the annual review
procedures in the development
agreement itself. The latter approach
makes the annual review process
part of the negotiations process as it
is the subject of negotiation and the
resolution of that negotiation
memorialized as a term of the
development agreement itself.

Other implementation strategies
include:

1. Assigning one person to
monitor agreement
performance.

2. Creating an implementation
matrix (cross-referencing the
section of the development
agreement, the obligation, the
trigger/timing, which local
agency department has lead
responsibility, and the
status).

Having a well-thought out
implementation strategy helps
ensure the agency gets the benefit of
its bargain.

ITEM 11.1.

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I NSTITUTE for LOCAL S ELF GOVERNMENT Ÿ C OMMUNITY LAND U SE P ROJECT | 41

SUMMARY
A well-crafted set of development agreement procedures will provide a useful road map to staff and others in sheparding an agreement through the approval process. Such procedures are also useful for considering any amendments to and termination of an agreement.

Important parts of the process include the notice and hearing process, as well as mechanisms for providing decision-maker input.

76 City of San Diego, Development Agreement Monitoring System, February 2000 (Submission for League of California Cities Helen Putnam Award for Excellence).

S AN D IEGO D ATABASE K EEPS D EVELOPMENT A GREEMENTS

O N T RACK
The City of San Diego’s Development Agreement Monitoring System tracks the status of payments owed by developers to cover the cost of project -related infrastructure, facilities and public services.76 In addition to helping city staff monitor compliance with the terms and conditions of development agreements, the system also generates reminders of annual report deadlines and due dates for administrative costs owed to the city.

Before the city developed the system in 1997, several departments shared responsi bility for monitoring the status of development agreements. The lack of effective coordination made oversight of the agreements uncertain. If, for example, the city’s issuance of a building permit for the 250th unit of a residential project obligated the developer to pay the city $250,000 for completion of a library, the city had no means to ensure that it requested the funds in a timely manner.

To address this problem, city staff formed an inter-departmental task force called the Development Monitoring Team. The Monitoring Team worked with city Management Information Systems personnel to create the Development Agreement Monitoring System. The system comprises a database containing files for each development agreement. The files list developer obligations and due dates under each agreement.

The monitoring team updates the status of developer obligations and shares this information with appropriate departments on a regular basis. As a result, the city has improved the timeliness of developer invoicing and collection. By February 2000, the Development Agreement Monitoring System helped the city to collect $17 million in developer obligations, and to track another $28 million that the city is due to receive by 2005.

ITEM 11.1.

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42 | D EVELOPMENT A GREEMENT M ANUAL

ITEM 11.1.

ATTACHMENT 1

THE ART OF

NEGOTIATING

DEVELOPMENT

AGREEMENTS
The art of negotiation comprises several facets. Fundamentally, it is important to decide who is going to negotiate and how the parties will reach consensus. This chapter addresses the issues associated with each facet of negotiation.

WHO IS GOING TO NEGOTIATE?
Within the public agency, senior staff or their representatives typically negotiate development agreements. The manager (or representative) should be involved because he or she presumably knows the community, understands the desires of the legislative body and can gauge the agreement’s value to the community.

The agency’s planning director (or representative) is typically on the negotiating team because of his or her planning background. While the manager may focus on financial benefits to the community, the planning director will be concerned with the impact of the project on land use issues, including its compatibility with surrounding land uses. Engineering or public works staff should be included if infrastructure issues are involved.

The public agency also may want to include the attorney on the negotiating team, rather than just at the agreement’s drafting stage, especially if the project proponent is represented by legal counsel. Legal issues wi ll undoubtedly arise during negotiations, and drafting issues may overlap with substantive deal points. Whether or not legal counsel participates in the negotiations, he or she should be fully apprised as the negotiations proceed.

Who Is Going to Negotiate? ....... 43

Reaching Consensus ................... 44
Summary ...................................... 48
5 C HAPTER
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44 | D EVELOPMENT A GREEMENT M ANUAL
As for the project proponent, he or she (or a representative with full legal authority to bind the project proponent) should participate in the negotiations. On larger projects, the project proponent may want to assemble a team that includes the project proponent, an architect, planner and land use attorney. Depending on what aspect of the agreement is being negotiated, the project proponent may want to include one or more of the team members in the negotiations.

REACHING CONSENSUS
How parties conduct negotiations may be the best indicator of whether they will achieve consensus. Participants should be trained in the process of negotiations, and have a framework in mind to guide the negotiation process.

KNOWING WHO IS ACROSS THE TABLE
Before negotiations begin, each party should become familiar with the other’s background. In addition, the project proponent should become familiar with the local political climate, while local agency staff should learn about the project proponent’s reputation in the community, or in other communities where the proponent’s de velopments have been approved.

The parties should also determine in advance what they expect to gain through the negotiations, what the other party may need, and what they are willing to give.

SETTING EXPECTATIONS
Once the parties meet, they should frankl y discuss their respective expectations. The local agency should emphasize that it expects to gain greater exactions than it could require under its regulatory authority. The project proponent should explain why the particular project requires a development agreement. The parties should agree upon an initial timeframe in which to complete negotiations.

The agency negotiators should explain that they do not have authority to bind the agency —that is the province of the legislative body during final public hearings. The parties may benefit from adopting a “check -off” system so that once they reach a conceptual agreement on deal points, they

77 See Cal. Gov’t Code § 1090. the Attorney General reached this conclusion even though the spouse had no ownership interests in the firm, he would not work on the agency’s project, and his income would not be affected by the outcome of the development agreement or project.

The Attorney General’s opinion will be published at 85 Cal. Op. Att’y Gen.____(2002), and is available online at http://caag.state.ca.us/opinions/index.htm.

P RACTICE P OINTERS
Legislative Body Member
Participation. Veterans of the
development agreement negotiation
process typically advise against
including a governing body
representative on the negotiating
team.

Such involvement can put the
elected official in a constrained
position when the final agreement
goes before the council or board.

Conflicts of Interest Issues. In
selecting negotiating team members,
keep in mind conflicts of interest
issues. For example, the Attorney
General opined in 2002 that a senior
local agency staff member may not
participate in the negotiations and
drafting of a development agreement
if her spouse is employed by a firm
that will provide outreach services
for the developer with respect to the
project pursuant to a yearly retainer
agreement. The Attorney General
found that the staff member’s
participation would violate conflicts
of interest laws relating to
contracts,77 even though the spouse
had no ownership interest in the
firm, he will not work on the city’s
project, and his income will not be
affected by the outcome of the
development agreement or project.

For more information about ethics
laws, please See The Local Official’s
Guide to Ethics Laws published by
the Institute for Local Self
Government.

ITEM 11.1.

ATTACHMENT 1

I NSTITUTE for LOCAL S ELF GOVERNMENT Ÿ C OMMU NITY LAND U SE P ROJECT | 45 do not need to continually renegotiate those points, unless circumstances change.

THE UTILITY OF GROUND RULES
Ground rules for negotiations are very important. Typical ground rules include:
• Who is the spokesperson for each side? To what
extent does that person have authority to bind their
respective principals?
• Who will take notes and document the points of
agreement?
• Where, when and for how long will the negotiators
meet? Will telephone negotiations be allowed?
• Are these meetings open to the media and public?
• When and how will issues related to the development
be presented to decisionmakers, including individual
members of the governing body?
• How will media inquiries be handled?
• What strategies, if any, will be employed if bargaining reaches an impasse?

S AMPLE GROUND R ULES FOR N EGOTIATIONS
The following types of ground rules may be adopted prior to negotiating a development agreement, in order to improve the parties’ chances of negotiating mutually acceptable terms and provisions.

The parties agree during negotiations to:

1. Listen to the other party’s needs and desires

2. Discuss mutual “interests” rather than individual “positions”

3. Encourage creative ideas by agreeing there are no stupid suggestions

4. Take into account each other’s needs and desires

5. Use objective standards and criteria to assess interests

6. Use a check-off system to conceptually approve deal points along the way

7. Avoid returning to approved points absent changed circumstances

8. Use a deal point outline rather than iterations of the agreement itself

9. Avoid drafting the agreement itself until all deal points are agreed upon

10. Develop a common understanding of the agency’s land use policies ITEM 11.1.

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46 | D EVELOPMENT A GREEMENT M ANUAL
Such ground rules should be memorialized in writing.

SETTING PRIORITIES
Each party should be clear on their organization’s priority issues going into the negotiations, so each priority can be addressed early on. Reaching agreement on these priority issues is, of course, the key to successful negotiations.

Typical priority issues for local agencies include:
• Land Use Issues. What regulations relating to density, design, uses, and construction standards is the agency
willing to freeze in place at the time the agreement is executed? On what issues does the agency wish to
retain the flexibility to adapt its regulations to changing circumstances and new information?
• Exaction Issues. W hich public improvements and
facilities will be constructed, dedicated or financed by the project proponent? On what schedule? Will there
be a reimbursement provision if the project proponent
fronts the financing for a facility?
• Special Issues Relating to State Requirements.

What role will school facilities and affordable housing issues play?
Thinking through these issues and what the local agency will need to make the development agreement a net gain in terms of the public’s interest is a key to successful negotiations.

HAVE A STRATEGY
Fundamentally, each party comes to the negotiations with certain priorities and objectives—some of which may be unrealistic. Finding compromise solutions can require a sense of the other party’s true objectives (and presenting one’s proposals in terms of those objectives) and patience while the other party works through what they had hoped to receive as the result of the negotiations and what they actually can receive. Moreover, negotiations can be stressful; less skilled negotiators may react to such stress with displays of anger and attempts to badger their way into prevailing.

P RACTICE P OINTERS
It can be useful to have a list
of what the agency must
receive as a condition of
agreeing to the development
agreement and what the
agency is willing to trade for
other concessions.

The list should include the
various options available to
satisfy the agency’s
objectives (for example,
building versus funding an
improvement). The list
should also include any limits
on what the agency can do
(for example, waiving a fee
that others must pay).

Making such determinations
in the heat of negotiations
can sometimes be a risky
strategy.

ITEM 11.1.

ATTACHMENT 1

I NSTITUTE for LOCAL S ELF GOVERNMENT Ÿ C OMMU NITY LAND U SE P ROJECT | 47 In most instances, it is important for both sides to keep in mind that there is a long-term relationship to be fostered. This relationship is frequently more important than short-term gains or “gotchas” on elements of the deal.

INTEREST-BASED BARGAINING TECHNIQUES
The parties may also agree in advance to use a particular negotiating approach. Historically, the negotiating model has involved a static process of developing positions in advance, based on confidential parameters set by the principals. More recently, professionals have advocated a more dynamic or synergistic approach that involves both parties working together to transcend competing interests.

Advocates of synergistic negotiations suggest that parties should:
• Share interests during negotiations (for example, what they fundamentally wish to accomplish or avoid) rather
than pre-determine, then haggle over positions;
• Acquire a real (in other wor ds, empathetic)
understanding of what the other party needs;
• Use brainstorming techniques to develop lists of options from which “outside-the-box” solutions can flow; and
• Agree to rely on objective standards or third -party
authority to settle differences and overcome obstacles.

Although conducting successful negotiations is a much larger topic than can be adequately addressed here, there are a number of resources that explain the benefits of negotiating in a more dynamic or synergistic fashion.78 For the local agency, an interest-based approach works better in light of the constraints of the state’s open meeting law. As a general matter there is no exception to the open meeting laws for local agencies to instruct their negotiating team on the provisions of a development agreement.

78 See, for example, Getting to Yes by William Ury and Roger Fischer, and The Seven Habits of Highly Effective People by Stephen R. Covey.

ITEM 11.1.

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48 | D EVELOPMENT A GREEMENT M ANUAL
The following illustrates this approach toward negotiations.

SUMMARY
By preparing in advance, developing a negotiating framework in which to proceed, and adopting ground rules, including how negotiations should be conducted, the parties s hould be able to create a negotiating environment that will increase the likelihood of reaching consensus.

I LLUSTRATION— T HE U RBAN L IMIT L INE AND B EYOND
Serene Valley is a large unincorporated area with an agricultural past. Much of the area is now built out, and the outlying farmland is seriously threatened by ever -expanding suburban development. As a result, the board of supervisors has established an urban limit line to prevent further sprawl.

Henry House is a project proponent who wishes to construct homes in Serene Valley. He is accustomed to building typical subdivisions projects with little open space, noting the continually increasing need for additional housing.

Mr. House applies for a development agreement to allow him to construct high-density housing beyond the urban limit line. Planning staff advises him that his application is likely to be denied (some would say dead on arrival). Some of his equity partners have owned property beyond the urban limit line for decades, and resent the influence of no-growth advocates who have only recently moved to the area.

As negotiations begin, the (somewhat skeptical) parties adopt a dynamic approach to negotiations, in which they agree to discuss respective interests rather than relative positions. Planning staff explain, for example, that they are interested in preserving the scenic nature of Serene Valley for future generations, rather than taking the position that they will never recommend construction beyond the urban limit line.

In turn, Mr. House explains that he is interested in constructing a project that will pencil out financially, rather than taking the position that the project must be constructed in a certain manner.

The parties eventually reach the conclusion that it is impossible to construct a conventional residential project that will make business sense while also respecting the urban limit line.

Nonetheless, they begin the next step in the process, which is brainstorming to identify mutually acceptable solutions. The parties are careful not to criticize ideas during the process or to dismiss any ideas as unrealistic. Slowly, suggestions emerge, ranging from creative suggestions that homes should not be visible from public streets to building underground homes.

It occurs to planning staff that the county has infill property that could fill out a town center concept envisioned by the specific plan for this part of the county’s unincorporated area. Moreover, the county has access to state park bond funds to potentially purchase conservation easements over Mr. House’s existing parcel, thereby helping the project pencil out for Mr. House and his partners. The mixed-use development contemplated by the specific plan is also consistent with Mr. House’s familiarity with higher density projects.

Helping Mr. House acquire the land may even help the county meet its affordable housing goals .

Planning staff also are aware, from a number of workshops the county has held on smart growth issues, that the supervisors are interested in more sustainable forms of development. The negotiators go forward with this concept successfully, creating a win -win situation.

ITEM 11.1.

ATTACHMENT 1

THE SUBSTANCE OF A

DEVELOPMENT

AGREEMENT
A number of considerations should be taken into account when drafting a development agreement. For efficien cy, many jurisdictions start with a standard form agreement that has already been reviewed and approved by the agency’s attorney. It is also helpful for negotiators to have reviewed:
• Current version of the development agreement law;79
• Planning policies for the area in question, including fee and dedications requirements and environmental
analyses; and
• Agency procedures for processing development
agreements.80
These steps help those involved in the negotiations identify the issues that will need to be negotiated to protect the public’s interests when drafting the agreement. It is also important to think ahead about implementation issues.

This chapter discusses some of the drafting and drafting-process issues that typically arise with development agreements.

WHO WILL DO THE DRAFTING?
A threshold issue is: From whose draft will the parties work? As indicated above, for local agencies expecting to be involved in a number of development agreements, it can be helpful for the agency to begin with a standard development agreement form that covers key and standard issues of concern to the agency. Sample development agreements are available online at www.ilsg.org/devtagmt
.

79 See Cal. Gov’t Code § 65864 and following (also available online at http://www.leginfo.ca.gov by clicking on “California Law”).
80 See Chapter IV and the sample procedures available online at www.ilsg.org/devtagmt .

Who Will Do The
Drafting? ...................................... 49
When Should The
Drafting Begin? ........................... 50
Common Provisions in
Development
Agreements................................... 50
Summary ...................................... 67

6 C HAPTER
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50 | D EVELOPMENT A GREEMENT M ANUAL
Of course, the standard form agreement can take negotiators only so far.

The next question is which party’s attorney will take the first crack at filling in the project -specific elements of the form. Development agreement negotiation veterans typically advise that the public agency’s counsel retain this role. In either event, it is not desirable to have both attorneys generating drafts of their own.

WHEN SHOULD THE DRAFTING BEGIN?
It may be tempting to prepare drafts of the development agreement as negotiations proceed. Some participants may derive comfort from having concrete proof that they are actually making progress.

However, the practice of preparing a draft as each of the deal points emerges can be expensive and result in unnecessary rewrites of the agreement. This practice may also afford the opportunity for drafting gamesmanship, in which slight but important changes are attempted beyond the scope of what the negotiators agreed to. The attorneys for each negotiating team must thoroughly review every draft, elevating otherwise avoidable tension in the remaining negotiations. It is preferable to list agreed-upon deal points for the entire agreement, including dates of each proposal and the name of the person who made it. Then, the development agreement can be drafted in close-to-finished form and subj ected to final editing and review by all parties. Use of the redline/strikeout computer function simplifies the process.

COMMON PROVISIONS IN DEVELOPMENT

AGREEMENTS

THE PARTIES TO THE A GREEMENT
Local agencies may enter into development agreements only with persons who have a “legal or equitable interest” in the real property in question.81 There may be others who should be parties to the agreement (for example, lenders). The goal is to identify whether there is anyone whose participation is necessary for the local agency to receive the benefit of its bargain, who would not automatically be bound by the agreement by its provisions as a successor-in-interest when the agreement is recorded.82

81 See Cal. Gov’t Code § 65865(a). See also National Parks and Conservation Association v.

County of Riverside, 42 Cal. App. 4 th 1505 (1996).
82 See Cal. Gov’t Code § 65868.5.

A NOTE A BOUT

C LARITY
Sometimes it is tempting
to use ambiguous
language to describe
issues on which the
parties are having
difficulties agreeing. This
temptation should be
avoided, inasmuch as it
only postpones
problems.

Moreover, given that the
agency will be able to
terminate the agreement
only upon substantial
evidence of
noncompliance, see Cal.

Gov’t Code § 65865.1
(there must be substantial
evidence the project
proponent has not
complied in good faith
with the agreement), there
is a high degree of risk
that ambiguities will
ultimately be resolved
against the public
agency.

ITEM 11.1.

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I NSTITUTE for LOCAL S ELF GOVERNMENT Ÿ C OMMUNITY LAND U SE P ROJECT | 51

USE OF RECITALS
It is common to include recitals, typically following the first paragraph of the agreement, that identify the parties to the agreement. Many development agreements begin with a recital explaining the advantages offered by this development agreement, and stating that the agreement is entered into pursuant to state development agreement law, Government Code section 65864 and following.

Recitals typically explain:
• Who the parties are;
• What the project is;
• That the project is consistent with the general plan and any applicable specific plan; and
• That the parti es have complied with the California
Environmental Quality Act.

Recitals may also identify other discretionary land use approvals that are required for the project (for example, approval of a subdivision map or discretionary land use permit), and whether those approvals have previously occurred, will occur simultaneously, or will occur only after the development agreement has been approved.83
On occasion, a recital may address contingencies that will delay the effective date of the agreement, such as the need for property annexation.84 TERM
The term must be stated in the body of the agreement. 85 Larger projects, especially those constructed in phases, may require longer terms. In other instances, planning staff may argue for a shorter term, perhaps five to t en years, to enable the local entity to revisit the property’s zoning and general plan designations sooner rather than later
There is some indication that the term of the agreement — or at least the time during which the agency agrees not to apply changes in land use

83 See Cal. Gov’t Code § 65865.2.
84 See generally Cal. Gov’t Code § 65865.3 (development agreements and newly incorporated or annexed areas).
85 See Cal.Gov’t Code § 65865.2
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52 | D EVELOPMENT A GREEMENT M ANUAL
regulations to the development—is one factor that the courts will evaluate if the development agreement is challenged.86
It is generally a good idea to allow the parties to terminate the agreement early in the event of a material breach. (See further discussion concerning default, remedies, and termination, below.)
Note that development agreements for unincorporated territory within cities’ sphere of influence must specify a timeframe within which the annexation must occur.87 The agreement does not become operative until the annexation occurs.88

REQUIRED CONTENTS
A development agreement must specify the:
• Permitted uses of the property;
• Density or intensity of use; and
• Maximum height and size of proposed buildings.89
These are also known as the developme nt plan. Because development agreements can and are being used in a variety of applications, the required content outlined above can be addressed more generically or more specifically, depending on the goals of the parties and the degree to which the absence of such specification in the agreement means that the agency’s regulations apply.90 As a matter of draftsmanship and avoiding a basis for challenge, however, it is useful to address each of the required content elements. 91
For example, the permitted uses can be generically established by reference to a zoning category, such as retail commercial, or specifically established

86 See generally Santa Margarita Area Residents Together v. San Luis Obispo County Board of Supervisors, 84 Cal. App. 4 th 221 (2000) (suggesting such freezes cannot be of unlimited duration and upholding a zoning freeze for five years)
87 See Cal. Gov’t Code § 65865(b).
88 See Cal. Gov’t Code § 65865(b).
89 Cal. Gov’t Code § 65865.2 (contents of development agreements). 90 See generally Santa Margarita Area Residents Together v. San Luis Obispo County Board of Supervisors, 84 Cal. App. 4 th 221 (2000) (finding the fact that the agreement did not mention maximum height and size of proposed buildings was not fatal because the agreement was subject to the county regulations of these variables).
91 See generally Santa Margarita Area Residents Together v. San Luis Obispo County Board of Supervisors, 84 Cal. App. 4 th 221 (2000) (adopting a “substantial compliance” approach to these required content elements).

P RACTICE P OINTER
A good rule of thumb for
the term of a development
agreement is five to ten
years. Any longer may
constr ain a local agency’s
ability to impose new
regulatory requirements to
respond to changing needs
and issues in the
community.

ITEM 11.1.

ATTACHMENT 1

I NSTITUTE for LOCAL S ELF GOVERNMENT Ÿ C OMMUNITY LAND U SE P ROJECT | 53 by reference to a site plan detailing every aspect of a proposed project.

Likewise, the density and intensity can be generically designated by using a range of possibilities, (six to ten units per acre, for example), or specifically designated (two units per acre). Similarly, the requirement that the maximum size and height of proposed buildings be included does not mean that every development agreement must propose buildings.

PUBLIC BENEFITS
Another required element of a development agreement is the provision for reservation or dedication of land for a public purpose. 92 A “permissive element” refers to the terms and conditions relatin g to the project proponent’s financing of necessary public facilities and the subsequent reimbursement of the project proponent for its non-pro rata share over time. 93 In fact, it is a good idea to specify all of the public benefits that will result from the agreement, following a recital explaining that the project proponent recognizes that he or she is being afforded greater latitude in exchange for agreeing to contribute greater public benefits than could otherwise be required, and that the project proponent does so freely and with full knowledge and consent.

ADDRESSING A POTENTIAL POLICE POWER CHALLENGE
Early on, commentators speculated whether adopting a development agreement might constitute an illegal “contracting away” of an agency’s police powers, which, in this context, refers to a local agency’s governing powers. “Police” derives from the Greek word polis, which means city.

Cities and counties typically obtain their police powers through the state Constitution.94
The California Constitution says, for example: “A county or city may make and enforce within its limits all local, police, sanitary, and other ordinances and regulations not in conflict with general laws.” 95 These powers afford the local agency latitude in dealing with issues that are local in nature and have not been addressed by the state legislature.

92 Cal. Gov’t Code § 65865.2.
93 See generally Santa Margarita Area Residents Together v. San Luis Obispo County Board of Supervisors, 84 Cal. App. 4 th 221 (2000) (finding the fact that the agreement did not mention maximum height and size of proposed buildings was not fatal because the agreement was subject to county regulations of these variables).
94 See Cal. Const. Art. XI, §7.
95 Cal. Const. art. XI, § 7.

ITEM 11.1.

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54 | D EVELOPMENT A GREEMENT M ANUAL
One thing a public agency cannot do is to contract away its police powers by enabling a private body or individual to control the exercise of its governing powers.96 In the case of development agreements, the question is whether the “freezing” of applicable land use regulations, so that the public agency cannot change the rules in a way that will prevent the project proponent from constructing or operating the project as approved, constitutes an illegal contracting away of police powers.

There are two ways that freezing of rules and regulations could conceivably constitute an illegal contracting away of police powers.

First, development agreements lock in the right to construct the project as approved once the agreement is in effect. Without a development agreement, the law allows the agency to impose additional requirements on a project up to the point at which the project proponent acquires vested rights by obtaining a building permit and doing substantial construction work in reliance on that permit.97
Second, development agreements do not allow the imposition of new rules that conflict with those in existence when the agreement was approved. 98 Without a development agreement, the agency may c hange the applicable zoning in a manner that is inconsistent with the project proponent’s vested rights, in which case, the property may acquire what is known as a “nonconforming use status” because the development on the property no longer conforms with the applicable zoning. While vested rights allow the owner to continue building and operating the project as originally approved, there may nonetheless be limitations on how the property can be used, including a prohibition against expanding nonconforming uses.

Whether either of these two aspects of development agreements constitutes an illegal contracting away of police powers may turn on the extent to which an agency surrenders all of its control over land use functions, rather than reserving most of its police powers except to the limited extent otherwise provided by the agreement.99

96 See generally Santa Margarita Area Residents Together v. San Luis Obispo County Board of Supervisors, 84 Cal. App. 4 th 221 (2000) (finding government enti ty does not contract away its police power unless the contract amounts to a surrender or abnegation of a proper governmental function).
97 See Avco Community Project Proponents, Inc. v. South Coast Regional Commission, 17 Cal.3d 785 (1976).
98 Cal. Gov’t Cod e § 65865.4.
99 See Morrison Homes Corp. v. City of Pleasanton, 58 Cal. App. 3d 724 (1976) (holding that an annexation agreement did not constitute an illegal “contracting away” of its legislative authority because it did not contract away all of the agency’s authority).

ITEM 11.1.

ATTACHMENT 1

I NSTITUTE for LOCAL S ELF GOVERNMENT Ÿ C OMMUNITY LAND U SE P ROJECT | 55 Accordingly, it is a good idea for the drafters to include a provision in the development agreement explaining the extent to which the property will continue to be subject to the enti ty’s zoning rules, regulations and policies, as well as a provision explicitly reserving the entity’s police powers unto itself, except as otherwise provided in the agreement.

RECOVERY OF COSTS
Depending on the nature of the project, negotiating a development agreement can involve significant costs for the public agency in the form of staff time and legal fees. The agency may want to provide for the recovery of some or all of those costs, either in its local procedures (as part of the cost of processing a development agreement) or as a term of the agreement itself. If provided for in the agency’s local procedures, the agency will want to ensure that it does not assess the project proponent more than its actual costs. One way is to establish an hourly rate a nd record the staff’s time spent working on the project.

WHICH REGULATIONS ARE FROZEN?
Three drafting considerations affect which local land use rules and regulations will apply under the terms and conditions of the development agreement.

First, state law says that unless the agreement provides otherwise (see sidebar at right), the rules and land use policies in effect when the development agreement is adopted will apply to the project. The project proponent will be inclined to want language to the effect that the local agency is not allowed to apply rules or land use policies that would effectively nullify its prior approval of the project. In turn, the agency’s attorney will want language that confirms the statute allows the agency to apply new rules in t he future, as long as they are not in conflict with the rules and regulations that were in place when the agreement was adopted.

Second, the attorneys need to decide what language to use in the event the parties agree to allow land uses that are inconsiste nt with the otherwise applicable zoning requirements in existence at the time the development agreement was negotiated. One approach is to include language saying the then-existing zoning ordinance governs, but only to the extent it is not inconsistent with any provisions of the agreement. Depending on the circumstances, the agency attorney may prefer to actually amend the zoning ordinance so that it is consistent with the development agreement, in order to allow other projects to request that zoning in the future.

P OSSIBLE

E XCLUSIONS FROM

THE F REEZE
Local agencies may wish to
discuss retaining their
discretion to apply changes to
the following components of a
development agreement:
• Impact fees;
• Uniform codes;
• Processing fees; and
• Procedural regulations.

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Third, the development agreement should state that the agency’s compliance is subject to later-enacted state and federal regulations.100 “MILESTONE” REQUIREMENTS
On larger, phased -in projects, it may be useful to include “milestone” requirements s o the agency can terminate the agreement if phases of construction have not been completed within a specified timeframe.

The project proponent may resist agreeing to absolute deadlines. In this case, the public agency may want to consider allowing the timeframe to begin with a specified event, such as issuance of building permits. Before doing so, however, the public agency should make sure there are adequate incentives for the project proponent to stay on schedule, and that the decision to begin the next phase is not left entirely to the project proponent’s discretion.

DEFAULT, REMEDIES AND TERMINATION
Drafters typically recite that upon the commission of a material breach, the other party may terminate the agreement and exercise other legal remedies that it may have.

Especially with respect to larger projects, parties may be motivated to enter into elaborate provisions concerning default, available remedies and termination, so that in the event of a material breach, the breaching party has a specified time to “cure” the breach, before the other party can terminate the agreement. These provisions may contain what are known as “force majeure” recitals that preclude terminating the agreement, or that extend the term of the agreement when performance is not possible due to war, insurrection, terrorism, strikes and other events that are beyond the control of the parties. Such provisions are generally advantageous to the project proponent, and create potentially lengthy periods in which the agency is unable to ap ply new land use rules and regulations that may affect the agency’s ability to do responsive land use planning.

NON-PERFORMANCE ISSUES
It is important to remember that a development agreement is indeed a contract, the breach of which may be subject to monetary damages. Some local agency attorneys include clauses limiting remedies against the agency to specific performance. Under some circumstances, liquidated damages

100 Cal. Gov’t Code § 65869.5.

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The local agency will also find it helpful to consider what kinds of assurances it wants to have available in the event the project proponent defaults on certain obligations. Some of the options local agencies may want to consider include:
• Letters of credit;
• Performance bonds; and
• Withholding certain approvals (for example building
permits, until satisfactory performance occurs).

The agency may also want to think through timing issues associated with the project proponent’s performance. In some instances, it ma y be advisable to specify timeframes for performing aspects of the development agreements and the consequences of not meeting those timeframes.

STATE OR FEDERAL L AWS
The parties may want to include a provision addressing the fact that state and federal regulations are not suspended by a development agreement. If a state or federal regulation is amended in a way that would preclude further performance under the agreement, the affected provisions of the development agreement will be modified or suspended.101

ANNUAL REVIEW
The parties may want to recite their awareness of the requirement for an annual review of the development agreement by the local entity. Recognize, however, that to the extent the parties make it the agency’s contractual obligation to conduct such a review, they may be setting the agency up for a failure to perform. 102 It is preferable to specify the agency’s procedures for conducting its annual review in the agency’s procedures ordinance or by resolution.

101 See Cal. Gov’t Code § 65869.5.
102 A number of agencies admit to having neglected annual reviews, which is inadvisable. A “tickler” system developed in collaboration with the clerk’s office can be a helpful reminder to hold these hearings once a year.

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ENFORCEMENT
The parties may want to include an enforcement provision reciting that the agreement is enforceable notwithstanding any changes to the general plan, specific plan (if any), or the zoning, which alters or amends an ordinance, rule, regulation or policy governing the zoning of the property during the term of the agreement.

RECORDATION
The parties may want to recite their awareness of the requirement that the agreement be recorded within 10 days following execution. Recognize, however, that to the extent the parties make it a contractual obligation of the local agency to timely record the agreement, they may be setting the agency up for a failure to perform.

CERTIFICATE OF SATISFACTION
The project proponent may wish to obtain “certificates of satisfaction” from the agency as phases of co nstruction are completed, reciting that each phase is in full compliance with its obligations under the development agreement. This certificate may be important to potential lenders. To the extent there are ongoing obligations, or obligations that transcen d the physical boundaries of a particular phase, it may be difficult for the local agency to make such attestations until the term of the development agreement has fully expired.

INDEMNIFICATION AND H OLD HARMLESS PROVISION
It is not uncommon to have the p roject proponent hold the local agency harmless from any liability the agency may incur as a result of entering into the agreement. Also helpful is a provision requiring the project proponent to indemnify and defend the agency at the proponent’s cost against any legal action instituted by a third party to challenge the validity of the agreement, including a challenge based on an assertion that the California Environmental Quality Act has not been complied with.103

103 Such arrangements have received the blessing of the California Attorney General’s Office.

See 85 Cal. Op. Att’y Gen. ___ (2002), available online at http://caag.state.ca.us/opinions/index.htm.

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AMENDMENT OR CANCELLATION
State law provide s that a development agreement can be amended or canceled, in whole or in part, by the mutual consent of the parties upon notice of intention to amend or cancel in the form required by Government Code sections 65090 and 65091, and adoption of an ordinance amending the agreement. The ordinance must also be found to be consistent with the general plan and any applicable specific plan, and is subject to referendum, just as the original ordinance adopting the development agreement was.

Drafters typically recite these statutory requirements in the agreement for the convenience of the parties.

ASSIGNMENT
Drafters typically include a provision that neither party shall assign or transfer any of its rights, interests or obligations under the agreement without the prior written consent of the other, which consent shall not be unreasonably withheld.

The project proponent may want to seek additional language, which states that subsequent purchasers automatically become parties to the agreement upon transfer of ownership.

SUCCESSORS
It is common to include a provision indicating that the obligations imposed by the agreement constitute “covenants running with the land” and that the burdens and benefits bind and inure to all estates and interests created in the subject pr operty and to all “successors-in -interest” of the original parties.

Public agencies have faced difficulties once a number of people become successors-in-interest by virtue of acquiring property governed by the agreement. In some cases, project proponents h ave gone bankrupt, making it difficult to justify enforcing the agreement against individual owners.

Depending on the circumstances, public agencies may want to require as a condition of approval that project proponents have homeowners (or property owners) associations governed by covenants, conditions, and restrictions (CC&Rs). The CC&Rs should include the development agreement obligations so that the association, as well as individual property owners, is responsible for ensuring performance of the development agreement.

To the extent the provisions of the CC&Rs supersede the development agreement, the association may have the flexibility to amend development ITEM 11.1.

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60 | D EVELOPMENT A GREEMENT M ANUAL
agreement obligations by a vote of less than 100 percent of the association membership. Also, the public agency may be granted enforcement rights under the CC&Rs.

VALIDITY OF PORTIONS OF THE A GREEMENT

SEVERABILITY
It is common to include a provision stating that if one aspect of the agreement is held by a court to be illegal, the validity of the remain ing provisions are not affected.

ATTORNEYS FEES
In lawsuits involving contracts, the law does not allow a party to recoup its attorneys fees as part of its damages unless the agreement so provides. As a result, many written agreements contain a provision s tating that if a lawsuit or other legal action is brought with respect to the agreement, the prevailing party is entitled to recoup reasonable attorneys fees and costs.

GOOD FAITH AND FAIR DEALING
Many agreements recite that the parties expressly acknowle dge that any actions they take pursuant to the development agreement will be measured by the “implied covenant of good faith and fair dealing.”

SIGNATURES AND SUBORDINATION
The drafter will want to decide who should sign the development agreement. In addit ion to the property owner and public agency, some practitioners require lenders, lessees and others with an interest in the property to sign the development agreement. Other attorneys require lenders, lessees and other interested parties to sign subordinat ion agreements, which make their interests in the property subject to the terms and conditions of the development agreement. In the event subordination agreements are balked at, local agencies may want to consider requiring other interested parties to at l east sign a written acknowledgment and consent, stating they are aware of the existence of the development agreement and that they understand its terms.

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SUMMARY
A number of issues warrant consideration when drafting a development agreement. In the final a nalysis, a well-drafted development agreement should accurately capture the deal points negotiated by the parties, and anticipate and address potential problems that may arise during implementation of its terms.

The Institute offers a variety of sample dev elopment agreements online through its database. The database is accessible through www.ilsg.org\devtagmt
. The Institute also welcomes submittals from
public agencies of additional samples for this database.

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GLOSSARY OF K EY T ERMS
Actions By Third Parties Necessary To Implement The Agreement: describes permits or fees required by other agencies such as school mitigation fees, environmental mitigation measures, etc.

Agency Default: describes the instances in which the agency would be in default such as:
• If a material warranty, representation or statement made or furnished by agency to the developer is false or proves to have been false in any material respect
• The agency fails to comply in good faith with a material requirement • An express repudiation, refusal, or renunciation of the agreement Agency Default; Developer Remedies: describes the options the developer would have in the event the agency is in default such as:
• To waive the default as not material
• To p ursue legal remedies provided for elsewhere in agreement • To terminate the agreement
• To delay or suspend developer performance which is delayed or precluded by the default of the agency Agency Obligations: heart of development agreement; describes what the agency is obligated to do such as diligently process further discretionary approvals, provide capacity, construct some improvements, reimburse certain funds advanced by developer, etc.

Amendment Of Agreement: describes how agreement will be amended; standard is that it is amended in same manner in which it was initially adopted (public hearing process through agency) (but see “Operating Memorandum”) Annual Review: a reminder that there is a state law requirement that there be an annual review of the agreement by the agency
Assignment: sets forth that neither party shall assign or transfer any of its rights, interests or obligations, without the prior written consent of the other, which consent shall not be unreasonably withheld Attorneys’ Fees And Applicable Law: states that if a lawsuit or other legal action is brought with respect to the agreement, the prevailing party is entitled to reasonable attorney’s fees and costs and identifies that California law will be used to interpret agreement
Bankruptcy: describes what happens in the case of a bankruptcy Certificate Of Satisfaction: a writing from the agency, as phases of construction are completed, stating that each phase is in compliance with its obligations under the agreement, often important to potential lenders Consistency With General Plan: required provision which states that the agreement is consistent with agency’s general plan
Cost Recovery: describes the method by which the agency will recover costs of staff time including legal fees for negotiation of the agreement
Covenants Run With The Land: states that the agreement is specific to the property, binds future owners and is not transferable to another property
Default And Remedies: describes what constitutes a default, what notice is required if one party thinks there is a default (generally a material breach), what remedies can be purused (for ex. damages, injunction, termination) Delay, Extension Of Times Of Performance: identifies that performance by a party may not be a default if the delays are due to war, strikes, riots, acts of God, or governmental entities other than agency (“see Force Majeur”) ITEM 11.1.

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GLOSSARY OF K EY T ERMS (CONTINUED ),
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Developer Default: describes the instances in which the developer would be in default such as:
• If a material warranty, representation, or statement made by the developer to the agency is false or proves to have been false in any material respect
• A finding by the agency that the developer fails to comply in good faith with any other material requi agreement
• An express repudiation, refusal, or renunciation of the agreement Developer Default; Agency Remedies: describes the options the agency would have in the event developer is in default such as:
• To waive the default as not material
• Refuse processing of a permit, approval, or other entitlement for • To terminate the agreement
• To delay or suspend agency performance which is delayed or precluded by the default of developer • To cure and charge back costs to the developer in emergency situations posing an immediate danger to health or safety
Developers’ Interest: describes what legal interest the developer has in the property Developer Obligations: heart of development agreement; describes what property owner/developer is obligated to do such as what improvements to be constructed and when, property to be dedicated and when, money to be paid and when, etc.

Development Plan: a development agreement must specify the permitted uses of the property, the density or intensity of use, and the max imum height and size of proposed buildings; because development agreements can and are being used in a variety of applications, the required content can be addressed more generically or more specifically, depending on the goals of the parties and the degre e to which the absence of such specification in the agreement means that the agency’s regulations apply. For example, the permitted uses can be generically established by reference to a zoning category such as “retail commercial” or specifically establish ed by reference to a site plan detailing every aspect of a proposed project. Likewise, the “density and intensity” can be generically designated by using a range of possibilities, (“6 to 10 units per acre,” for example), or specifically designated at “2 units per acre”. Similarly, the requirement that the maximum size and height of proposed buildings be included does not mean that every agreement must propose buildings
Encumbrances On The Subject Property: identifies subordination and mortagee informat ion regarding protection and obligations including notice of default and right to cure Entire Agreement: provides that the agreement embodies all the terms of the agreement and no “outside” agreements are valid
Estoppel Certificate: a written notice tha t the agreement is in full force and effect, a binding obligation of the parties and there is not a default
Exhibits: outlines what exhibits are attached and made a part of the agreement Force Majeure: describes that performance may be excused due to w ar, terrorism, strikes, and other events beyond the control of the parties
Good Faith And Fair Dealing: sets forth that the parties expressly acknowledge that any actions they take will be measured by the “covenant of good faith and fair dealing” Hold Harmless And Indemnification: requires the developer to hold the local agency harmless from any liability the agency may incur as a result of entering into the agreement; states that the developer will to indemnify and defend the agency at the developer’s c ost against any legal action instituted by a third party to challenge the validity of the agreement, including a challenge based on CEQA compliance ITEM 11.1.

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GLOSSARY OF K EY T ERMS (CONTINUED ),
Incorporation Of Recitals: generally states that the recitals which p recede the “now therefore” clause are incorporated into the agreement itself.

Insurance: sets forth types and amounts of insurance that the developer is to provide as security for the hold harmless and indenmnity requirements
Jurisdiction And Venue: identifies the county in which any litigation should be filed and that the interpretation, validity, and enforcement of the agreement shall be governed by California law Liquidated Damages: identifies circumstances which would limit remedies against the agency to specific performance (no ability to receive money damages); under some circumstances, liquidated damages clauses may protect the agency from upside risks associated with damages awards. There may be instances in which the agency desires liquidated damages if developer fails to perform (such as failure to dedicate property Milestones: see Phasing
Notices: describes where and how notices required in the agreement are to be sent Operating Memorandum: describes instances in which formal amendment to agreement is not needed to implement the agreement such as minor refinements and/or clarifications; should be up to agency’s sole discretion to determine whether amendment or “Operating Memorandum” is appropriate Parties To The Agreement: identifies the persons having “legal or equitable interest” in the property Phasing Of Development: describes the “triggers” or “milestones” of the project; may also be known as the “development plan”; on larger, phased projects, it may be useful to include “milestone” requirements so the agency can terminate the agreement if phases have not been completed within a specified time frame Private Undertaking: identifies that the project is a private development and there is no partnership, joint venture, or other association of any kind between the developer and the agency Project And Property Subject To This Agreement: describes the project name, street address and references a legal description of the property (generally an exhibit)
Protest Rights: provides for the developer to waive protest rights, and releases the agency from any claims arising out of the calculation, allocation, and use of development mitigation fees (AB 1600 fees) Public Benefits: this provision is a required element of a development agreement related to the reservation or dedication of land for a public purpose; a permissive element is the terms and conditions relating to the project financing of necessary public facilities and the subsequent reimbursement for the developer’s non-pro rata share over time, and generally includes a description of the public benefits that will result from the agreement, following a recital explaining that the developer recognizes that greater latitude is provided in exchange for agreeing to contribute greater public benefits than could otherwise be required.

Recitals: describes the parties to the agreement; also describes applications and hearing process as well as CEQA review (for example: development agreement application number, general plan amendment application number, type of CEQA review done (if EIR gives state clearinghouse number), also identifies dates of public hearings before planning commission and agency; many development agreements begin with a recital explaining the positive effects of entering into a development agreement, and that the agreement is entered into pursuant to the state development agreement law; a recital may address contingencies that will delay the effective date of the agreement, such as the need for annexation of the property
Recordation: implements state law requirement which requires the agreement to be recorded ITEM 11.1.

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GLOSSARY OF K EY T ERMS (CONTINUED )
Reserved Discretionary Approvals: describes, generally in some detail, the approvals which are subject to discretion even after the agreement locks in or freezes other regulations; some regulations which may be important to “reserve” are impact fees, uniform codes, processing fees, certain procedural regulations (method of submitting final map – number of copies, Mylar, GIS format, etc.)
Security: describes what the agency will require to assure performance such as letters of credit, performance bonds, or the ability to withhold certain approvals (for example building permits), until performance occurs Severability; also called Validity: sets forth that if one aspect of the agreement is held by a court to be illegal, the validity of the remaining provisions are not affected
Signatures: identifies who should s ign the development agreement; in addition to the property owner and agency, some agencies require lenders, lessees and others with an interest in the property, to sign the development agreement or to sign subordination agreements (see “subordination”).

Su bordination: an action by which another entity makes their interests in the property subject to the terms and conditions of the agreement and acknowledges the existence of the agreement Successors : identifies that the obligations imposed by the agreement constitute “covenants running with the land” and that the burdens and benefits bind all future purchasers Term: identifies the length of time the agreement (which must be stated in the agreement); larger projects, especially those constructed in phases, may require 10, 15 or 20 year terms Termination (upon completion of development): provides that upon sale of individual lots all obligations of developer are discharged with respect to lots upon final inspection and issuance of certificates of occupancy Vested Components: describes, generally in some detail, the existing development regulations, etc. that are “frozen” or “locked in” by the agreement
Waivers: states that a waiver of one breach is not a waiver of any other breach ITEM 11.1.

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7 C HAPTER CONCLUSION
Development agreements can be a useful tool in land use planning, creating win-win opportunities for both project proponents and local agencies when dealing with uncertainties associated with the regulatory environment.

The goal of this manual is to help local agencies in understanding development agreements and to provide them with practical tools to assist them in using development agreements within their jurisdiction.

Did the manual succeed in achieving this goal? The Institute and its financial supporters are very interested in local agency feedback. Please fill out the form at the end of this publication to let the Institute know whether this material was useful and how it could be improved.

Feedback Form............................. 67

Additional Institute
Publications .................................. 69
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DEVELOPMENT AGREEMENT MANUAL FEEDBACK FORM
We are interested to hear your comments. This is your chance to shape future Institute publications. You may either copy this page and mail or fax it to:

Institute for Local Self Government
Attn: Development Agreement
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Sacramento, CA 95814
Fax: (916) 658-8240
Or comment by email to [email protected]. Please put “Development Agreement Manual” in the subject line.

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I USED THE MATERIAL IN THE DEVELOPMENT AGREEMENT M ANUAL TO:

Update/create our agency’s development agreement procedures Update/create our agency’s standard form development agreement Other (please specify)

ITEM 11.1.

ATTACHMENT 1

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ATTN: DEVELOPMENT AGREEMENT 2002
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SACRAMENTO, CA 95814

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INDEX
A-B
AB 1600................................65
Affordable housing................28
Amendment.........16, 30, 59, 62
Annual review.......................22
Application .........18, 22, 30, 31
Application Process ........30, 31
Assignment .....................59, 62
Attorneys fees .......................60
Brown Act.................26, 37, 45
Building permit17, 19, 22, 41,
54, 56, 57, 67
C-E
California Environmental Quality
Act (CEQA)...... 20, 32, 51, 58
Cancellation........................... 59
Certificate of satisfaction...... 58
Challenge, statute of limitations
for.................. 17, 22, 23, 32, 54
Coastal zone.................... 17, 35
Conditional use permit ......9, 32
Confidentiality, see also Brown
Act .........................................26
Covenant of good faith and fair
dealing17, 19, 40, 50, 60, 62,
64 Covenants, conditions and
restrictions (CC&Rs).............59
Default, remedies and
termination.................56, 62, 64
Density ............................26, 52
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Development Agreement:

Act, .......................22 ,31, 51
Law, Legislative history..2,
4, 17, 21, 26, 27, 30, 31, 32, 34,
36, 40, 49, 51, 54, 65
Development Agreement
(continued)
Checklist of common
provisions .............................50
Defined ..................22, 31, 51
Maximum height and size of
proposed buildings....26, 52, 64
Permitted uses of property.4,
16, 17, 26, 35, 48, 50, 51, 52,
5458, 59, 60, 62, 64,65, 67
Purpose ..11, 15, 26, 30, 31,
53 ,65
Recitals........................51, 65
Required Contents .............52
Term....9, 10, 19, 26, 27, 34,
34, 40, 41, 45, 47, 52, 53, 55, 58,
60, 60, 64, 65, 67
Termination....30, 40, 41, 52,
56, 62, 67
Accountability ...................40
Compared to vesting tentative
map........................................22
Statute of limitations...17, 22,
23, 32, 54
Effect of annexation and
incorporation.......27, 51, 52, 65
Fees...14, 15, 17, 17, 18, 22,
32, 33, 34, 62, 67
Findings......27, 30, 31, 36, 37
Recordation......30, 39, 58, 65
Statutory authority for ..15,
22, 59
Subordination.........60, 64, 67
Successors....................59, 67
Development impact fees..........
...............................15, 55, 67
Development plan .52, 64, 65
Educational Revenue
Augmentation Fund (ERAF) 15
Enforcement.............. 58, 60, 65
Exactions................... 14, 44, 47
F-K
Findings......... 27, 30, 31, 36, 37
“Frozen” regulations ....... 55, 67
General plan 9, 11, 13, 13, 14,
26, 37, 51, 58, 59, 62, 65
Growth management............. 12
Indemnification............... 58, 64
L-N
Lenders......... 50, 58, 60, 62, 67
Letters of credit............... 57, 67
Liquidated damages....... 56, 65
“Milestone” requirements... 56,
65 Mitigation Fee Act... 15, 14, 32
Negotiating team37, 43, 44, 47,
50 Negotiations10, 12, 13, 14, 18,
26, 28, 31, 33, 33, 36, 40, 43, 44,
45, 46, 47, 48, 49, 50
Non-performance issues ....... 56
Notice issues......................... 35
O-R
Open meeting law..... 26, 38, 47
Open space ..................... 12, 48
Parties to the agreement9, 50,
51, 59, 65
Performance bonds.......... 57, 67
Planning Commission... 30, 33,
34 ,36, 37, 65
Police power ....... 22, 38, 53, 54
“police power” challenge ...... 53
Prevailing wage requirement.. 18
Proposition 98 ...................... 15
Public benefits........... 30, 53, 65
Public hearings.... 32, 34, 44, 65
Public input..................... 32, 34
Public Records Act................34
Recovery of costs ...........34, 55
Referendum......................32, 59
Regulatory takings.............2, 16
S-T
Sales tax...........................13, 33
SB 50.....................................16
School facility fees.................16
Specific plan9, 11, 14, 26, 37,
48, 51, 58, 59
Sphere of influence..........27, 52
Stakeholders...............33, 34, 34
U-Z
Unincorporated territory .27, 52
Urban limit line......................48
Vested right....17, 20, 20, 22, 54
Zoning9, 12, 13 ,35, 37, 51, 52,
54, 55, 58, 64
ITEM 11.1.

ATTACHMENT 1

ITEM 11.1.

ATTACHMENT 1

5 Key Aspects of the Development Agreement
Process

1. Evaluating the advantages and disadvantages of using development agreements;

2. Understanding the role development agreements can play in achieving local agency land use planning objectives;

3. Knowing the procedural issues related to development agreements;

4. Incorporating the necessary substantive provisions in development agreements; and

5. Mastering the art of negotiating development agreements.

All explained in one handy and easy-to-read manual.

Development Agreement Manual: Collaboration in Pursuit of Community Interests SKU: 1170 Price: $20.00

ITEM 11.1.

ATTACHMENT 1

DPML-58478\2741817.1
1331 N. California Blvd.

Suite 600
Walnut Creek, CA 94596
T 925 935 9400
F 925 933 4126
www.msrlegal.com
Arthur F. Coon
Direct Dial: 925 941 3233
[email protected]
Offices: Walnut Creek / San Francisco / Newport Beach
February 17, 2023

VIA EMAIL
Honorable Mayor Budge, Vice Mayor
Sander, and City Councilmembers
City of Rancho Cordova
2729 Prospect Park Drive
Rancho Cordova, CA 95670
Email: [email protected]
Re: Further Response to January 27, 2023 Second Letter to City Council and Initial Response to Third (February 13, 2023) Letter to City Council from Attorney Gloria D. Smith Concerning Development Agreement, CEQA Review, and Land Use Compliance Issues/LogistiCenter Project at Corner of N. Mather Blvd./Bear Hollow Drive (APN 072-2360-041-000), File No. PLND- 1021-0015.

Dear Mayor Budge, Vice Mayor Sander, and Honorable Members of the City Council:

We submit this letter on behalf of Dermody Properties (“Dermody”), the successor- in-interest to Elliott Homes, Inc., the original developer party to the “Villages of Zinfandel Development Agreement” (“Development Agreement” or “Agreement”). As previously indicated, we write again primarily to respond in more detail to the meritless contentions raised in the above-referenced January 27 letter from Gloria D. Smith (the “second Smith letter”). As noted in my February 6, 2023 letter to the Council, the second Smith letter is fundamentally and fatally flawed because it relies on material mischaracterizations of the law and ignores or refuses to acknowledge the relevant underlying facts; it is simply another last-ditch effort by Project opponents to prevent the Council from fulfilling its legal obligations under the Agreement and applicable law to reach a final decision and approve the Project, as it was presented fully to the Council on January 17, 2023. As we have repeatedly communicated to the City, if the Council were to ignore its obligations under the Development Agreement, as Ms. Smith urges the City to do, the City would be exposing itself to significant monetary damages and other remedies including attorneys’ fees as expressly provided for in the Agreement.

We also address herein a subsequent, two-page, February 13, 2023 letter to the Council from Ms. Smith, purporting to “clarify” the second Smith letter.

ITEM 11.1.

ATTACHMENT 2

Mayor Budge, Vice Mayor Sander, and City Councilmembers February 17, 2023

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We address the issues in further detail below.

I. The City is a successor in interest to the Development Agreement and is bound by it until June of 2023.

Contrary to Ms. Smith’s claims, nothing in state law or the factual record indicates that the Development Agreement was somehow invalidated, whether automatically as a matter of law or by some action of the parties, when the City incorporated in 2003, or that it subsequently expired prior to the end of its negotiated term, which will end in June of 2023. When the City incorporated, it became the successor in interest to the County of Sacramento, and thereby succeeded to the legal benefits and burdens negotiated by the County as a signatory to the Development Agreement. Ms. Smith ignores these key underlying principles and argues that a pre-incorporation development agreement can only continue into effect after an affected territory is incorporated if Government Code1 section 65865.3 applies to that agreement. The plain language of Section 65865.3, however, makes clear that that statute only operates to initially limit the duration of validity (i.e., the term that an agreement is in effect) of a specified subset of pre-incorporation development agreements. Nothing in Section 65865.3 states that unless it applies a development agreement between a county and a developer automatically becomes null and void when a subject property becomes part of newly incorporated territory or is annexed into a city. Moreover, repeated actions by public agencies with jurisdiction over the ZSPA—including the County, the City, and LAFCO—clearly recognize and evidence that the Development Agreement was never terminated by any action of the parties and that it continues in full effect.

A. Section 65868.5 binds successors in interest, including the City, to the benefits and burdens negotiated by the original parties to the Development Agreement.

The second Smith letter ignores fundamental provisions of state law that bind all successors in interest of all original parties to a duly recorded development agreement to the respective rights and obligations of those parties under that agreement. As the County’s successor in interest, the City as a matter of law assumed the benefits and burdens that the County agreed to as an original party to the Development Agreement.

Section 65868.5 provides:
[n]o later than 10 days after a city, county, or city and county enters into a development agreement, the clerk of the legislative body shall record with the county recorder a copy of the agreement which shall describe the land subject thereto. From and after the time of such recordation, the agreement shall impart such notice thereof to all persons as is afforded by the recording laws of this state. The burdens of the agreement shall be binding upon,

1 Unless otherwise indicated, all references herein are to the Government Code.

ITEM 11.1.

ATTACHMENT 2

Mayor Budge, Vice Mayor Sander, and City Councilmembers February 17, 2023

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and the benefits of the agreement shall inure to, all successors in interest to the parties to the agreement.
(§ 65868.5, emph. added.)
The Government Code does not define “successors in interest” in the context of development agreements. However, both the common meaning of that term and the fact that the statute mentions “parties” (in plural form) indicates that it contemplates that the government agency party, with land use authority over the property at issue, can have a successor in interest, just as the developer party can have such a successor or successors. By its very nature, one of the parties to a development agreement will always be a government agency with general land use authority. (See § 65865 [authorizing cities and counties to enter into statutory development agreements with persons having interest in real property subject to such an agreement].)
In this instance, the plain language of Section 65868.5 indicates that the Development Agreement, which was duly executed by Elliott Homes and the County in 2003, and subsequently recorded by the County, was binding on Elliott Homes’ successors in interest and on the County’s successor in interest. Elliott Homes’ successors in interest included the developers and landowners that purchased portions of the Zinfandel Special Plan Area (ZSPA) within the land subject to the Development Agreement – including Dermody. The County’s successor in interest is the City, which is the agency that succeeded to the County’s general land use authority over the ZSPA within the territory covered by the Development Agreement.

B. Section 65865.3 and its limits on validity of an
agreement’s duration do not apply to the Development Agreement, and the Development Agreement continued in effect after the City’s incorporation.

Section 65865.3 places limitations on the effective term of the limited set of development agreements to which it applies. Nothing in Section 65865.3 states that a development agreement between a county and a developer on property that subsequently becomes incorporated into a newly incorporated city is ineffective to bind successor cities or is rendered automatically null and void if Section 65865.3 does not apply at all to that agreement. If that was the Legislature’s intent in enacting Section 65865.3, it could have easily expressed that intent in clear and plain language, but it did not.2 Moreover, a close reading of each of Section 65865.3’s subdivision’s further indicates that was clearly not the Legislature’s intent.

2 For example, Section 65865(b) provides that any city may enter into a development agreement with a person having a legal or equitable interest in real property in unincorporated territory within that city’s sphere of influence. However, if annexation proceedings for that territory are not completed within the time specified by the agreement or any extension of the agreement “the agreement is null and

ITEM 11.1.

ATTACHMENT 2

Mayor Budge, Vice Mayor Sander, and City Councilmembers February 17, 2023

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1. Section 65865.3 subdivision (a) places time limits
on the duration of validity of some pre-incorporation/annexation development agreements affecting territory in newly incorporated cities or newly annexed areas. It also pre-supposes that application of Section 65865.3 is not necessary for pre-incorporation/annexation development agreements to remain in effect in such cities or areas after incorporation.

The operative provision of Section 65865.3 is found in its subdivision (a), which limits the duration of validity of certain development agreements to which it applies:

Except as otherwise provided in subdivisions (b) and (c), Section 65868, or Section 65869.5, notwithstanding any other law, if a newly incorporated city or newly annexed area comprises territory that was formerly unincorporated, any development agreement entered into by the county prior to the effective date of the incorporation or annexation shall remain valid for the duration of the agreement, or eight years from the effective date of the incorporation or annexation, whichever is earlier.

The holder of the development agreement and the city may agree that the development agreement shall remain valid for more than eight years, provided that the longer period shall not exceed 15 years from the effective date of the incorporation or annexation. The holder of the development agreement and the city shall have the same rights and obligations with respect to each other as if the property had remained in the unincorporated territory of the county.
(§ 65865.3 (a), emph. added.)
The above-referenced subdivision (a) contains several express exceptions and limitations, including, as discussed below, but not limited to, the proviso that its provisions (where they do apply) apply only to territory of a “newly incorporated city” or a “newly annexed area.” Beginning first with the statute’s exceptions, Section 65865.3(a) states that it applies “[e]xcept as provided in subdivisions (b) and (c), Section 65868 or 65869.5….” A review of Sections 65868 and 65869.5 demonstrates that the application of Section 65865.3 is not necessary for a development agreement to continue in effect after territory subject to a development agreement is newly incorporated.

In relevant part, Section 65868 states that a development agreement “may be amended or canceled in whole or in part by mutual consent of the parties to the agreement or their successors in interest” and then sets out procedural requirements to do so. However, if a development agreement were rendered automatically invalid or ineffective upon a new city’s incorporation of the subject

void.” (§65865(b), emph. added.) Section 65865.3 contains no similar language providing that development agreements, not meeting the requirements in subdivisions (c) or (d) of that section, and hence to which the statute’s limitations on duration do not apply, are “null and void”.

ITEM 11.1.

ATTACHMENT 2

Mayor Budge, Vice Mayor Sander, and City Councilmembers February 17, 2023

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territory, as the second and third Smith letters argue, unless Section 65865.3 applied, it would make no sense to cite Section 65868 as an exception to Section 65865.3 since a putative successor (like the City) could never amend or cancel an agreement that was never valid and binding on it in the first place, nor would it need to. By excepting Section 65868, Section 65865.3 recognizes that an incorporating city that succeeds to a development agreement entered into by a county can, inter alia, agree with an applicant to cancel it, in which case Section 65865.3 would not apply. This logically compels the conclusion that a pre-incorporation or annexation development agreement entered into between a county and a developer for land subsequently incorporated or annexed into a city has legal validity independent of the applicability of Section 65865.3 to that agreement.

Section 65869.5 provides in relevant part that if subsequent changes in state or federal laws or regulations prevent or preclude compliance with one or more development agreement provisions, those provisions shall be modified or suspended as needed to comply with new state or federal law. (§ 65869.5 (a).) Here again, it would be unnecessary and an idle act for the Legislature to have expressly set forth Section 65869.5 as constituting an exception to 65865.3’s applicability if there were no valid and binding development agreement with provisions that needed to be amended or suspended at all absent application of Section 65865.3.

2. Section 65865.3 subdivision (b) presupposes that
a pre-incorporation/annexation development agreement continues in effect regardless of whether Section 65865.3 applies.

Subdivision (b) of Section 65865.3, also expressly carved out as an exception in that statute’s subdivision (a), allows a city to modify or suspend the provisions of a development agreement if it determines a failure to do so would place its residents “in a condition dangerous to their health and safety.” Again, by its nature subdivision (b) presupposes that a development agreement can be valid for a territory that is later incorporated or annexed into a city, such that the agreement can be modified without application of Section 65865.3. This would not be possible if Section 65865.3 provided the sole conditions under which a county and developer- executed development agreement could bind a successor city, as the Smith letters argue.

3. Section 65865.3 subdivision (c) does not provide
that a pre-incorporation/annexation development agreement not meeting the requirements that render it applicable is automatically rendered ineffective or null and void.

Subdivision (c), the last of Section 65865.3(a)’s express statutory exceptions, lists three conditions that must be met for Section 65865.3’s time-limiting provisions to apply to a development agreement. However, like the statutory provisions discussed above, it also does not purport to void or nullify agreements that do not meet these requirements. Subdivision (c) states that, except as provided in subdivision (d), ITEM 11.1.

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Mayor Budge, Vice Mayor Sander, and City Councilmembers February 17, 2023

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Section 65865.3 applies to development agreements that meet all three of the following requirements:
(1) The application for the agreement is submitted to the county prior to the date that the first signature was affixed to the petition for incorporation or annexation pursuant to Section 56704 or the adoption of the resolution pursuant to Section 56800, whichever occurs first.
(2) The county enters into the agreement with the applicant prior to the date of the election on the question of incorporation or annexation, or, in the case of an annexation without an election pursuant to Section 57075, prior to the date that the conducting authority orders the annexation. (3) The annexation proposal is initiated by the city. If the annexation proposal is initiated by a petitioner other than the city, the development agreement is valid unless the city adopts written findings that implementation of the development agreement would create a condition injurious to the health, safety, or welfare of city residents.
(§ 65865.3 (c).)
As noted in my November 29, 2022 letter to the Council, and as conceded in the third Smith letter, the election on incorporation of the City of Rancho Cordova occurred in November of 2002, which was before May 28, 2003, when the County and Dermody’s predecessor in interest entered into the Development Agreement.

This means that the Development Agreement does not meet the condition in subdivision (c)(2) that the county “enter[ ] into the agreement with the applicant prior to the date of the election on the question of incorporation or annexation…” Thus, Section 65865.3 and the term duration limits set forth in its subdivision (a) did not apply to the Development Agreement. Again, however, nothing in Section 65865.3 says that pre-incorporation/annexation development agreements that do not meet subdivision (c)’s requirements, and thus to which the statute does not apply, are automatically null and void, as Ms. Smith erroneously argues.

4. Section 65865.3 subdivision (d) does not
invalidate pre-incorporation/annexation development agreements where incorporation/annexation was complete before January 1, 1987, as Ms.

Smith’s logic would dictate.

Subdivision (d) of Section 65865.3 excludes application of the section to pre- incorporation/annexation development agreements for newly incorporated or annexed territory where incorporation or annexation of the territory occurred prior to January 1, 1987, which was presumptively the effective date of Section 65865.3.3

3 As a general rule, for obvious concerns related to constitutionally required due process, legislation is prospective only in operation unless the Legislature clearly

ITEM 11.1.

ATTACHMENT 2

Mayor Budge, Vice Mayor Sander, and City Councilmembers February 17, 2023

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But Subdivision (d)’s exclusion of older pre-incorporation/annexation development agreements from the statute’s application in no way indicates that development agreements preceding Section 65865.3’s effective date are null and void, which would be the result of Smith’s reading of the statute, i.e., if application of Section 65865.3 was the sole method by which a pre-incorporation development agreement could continue in effect and bind a subsequently (newly) incorporated city.4 II. Sacramento County LAFCO Resolution 1243 conditionally approving the incorporation of Rancho Cordova required the Development Agreement to remain valid and effective after the City’s incorporation.

Moving beyond the plain language of the state Development Agreement law to the relevant facts, in May of 2002, when the Sacramento Local Agency Formation Commission (“LAFCO”) adopted its resolution conditionally approving the petition to incorporate the City of Rancho Cordova, it adopted a condition that expressly required development agreements for the territory to be newly incorporated as part of the new City to remain valid and enforceable between the developer and the City.

Condition 9(j) of that Resolution 1243 reads as follows:

Any and all development agreements entered into between the County of Sacramento and any development project
applicant, and any conditions of approval (including mitigation measures adopted pursuant to the California Environmental

expresses a contrary intent. The legislature adopted Section 65865.3 in 1986 and the vast majority of non-urgency statutes go into effect on January 1 of the year following a bill’s enactment.
4 To the contrary, as noted in the preceding footnote, it is likely that the Legislature adopted subdivision (d) to avoid constitutional due process concerns – heightened in this context – that would arise if Section 65865.3 retroactively shortened the effective term of previously executed development agreements that conferred vested rights on developer parties for a negotiated term. For example, if a development agreement were entered into between a county and a developer in 1983 with a term of twenty years, and the territory subject to that development agreement were incorporated or annexed into a city in 1984, retroactive application of Section 65865.3’s (enacted in 1986) shorter validity of duration limitations (8 or 15 years) would cut short the developer’s originally negotiated 20 years of vested property rights. (See In re Marriage of Buol (1985) 39 Cal.3d 751, 758 [while the Legislature is generally free to apply changes in rules of procedure retroactively when no vested rights are involved, it is constrained from doing so when vested rights are involved].) Ms. Smith’s incorrect interpretation of the statute, however, would have the opposite effect—because Section 65853.3 does not apply to agreements impacting land incorporated or annexed prior to its enactment, but that were entered into prior to incorporation or annexation, the section would retroactively invalidate such agreements, thus nullifying, without any meaningful notice or amortization period, valuable vested rights negotiated for and acquired by the developer. Such an absurd result was obviously not intended by the Legislature.

ITEM 11.1.

ATTACHMENT 2

Mayor Budge, Vice Mayor Sander, and City Councilmembers February 17, 2023

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Quality Act) imposed by the County Board of Supervisors on any and all discretionary projects adopted and approved prior to the effective date of incorporation shall remain valid and
enforceable between the applicant and the new City of
Rancho Cordova, subject to Government Code Section
65865.3, subdivisions (a) and (b).
(Sacramento LAFCO Resolution No. 1243 Making Determinations for the Approval of the Incorporation of Rancho Cordova, California, May 22, 2002, ¶ 9(j), emph. added. A true and correct copy of Resolution 1243 is attached hereto as Exhibit A.) Resolution No. 1243 makes clear that as a condition of the City’s incorporation, any existing development agreements for newly incorporated territory previously entered into between the County and developers remained valid and binding after the new City’s incorporation, subject only to the provisions of subdivisions (a) and (b) of Section 65865.3. This LAFCO condition governed regardless of whether a pre- incorporation developer/county development agreement otherwise met the requirements of Section 65865.3 subdivision (c), which is conspicuously omitted from LAFCO’s resolution. Accordingly, even though the statute itself didn’t apply on its face, LAFCO’s resolution by its own terms made the substantive provisions of Section 65865.3(a) and (b) applicable. Thus, the Development Agreement was clearly valid subject only to the referenced statute’s limitations on the duration of its validity, which on their face applied to newly incorporated or annexed territory.

III. The City executed three amendments to the Development Agreement, repeatedly acknowledging that the Development Agreement remains in effect.

As evidenced by later events, the City also clearly recognized that the Development Agreement continued in effect after the City’s incorporation when it subsequently negotiated and executed three separate amendments to the Development Agreement. As explained in more detail below, each of these amendments expressly acknowledged that, except as amended, the terms and conditions of the Agreement remained in full force and effect. The most recent of these amendments, from August of 2016, makes clear that the Agreement continues in effect until June of 2023. Further, the statutory deadlines under the applicable statute of limitations for opponents to challenge the validity of the Development Agreement, or any of its amendments, have long since expired.

1. The 2004 Amendment acknowledged that the
Development Agreement remained in full force and effect and temporarily shortened its term by 5 years.

On August 2, 2004, when the City was still newly incorporated, the City and Elliott Homes, Inc. executed the first amendment to the Development Agreement (“2004 Amendment”, a true and correct copy of which is attached hereto as Exhibit B).

Among other things, this amendment altered the land use regulations applicable to ITEM 11.1.

ATTACHMENT 2

Mayor Budge, Vice Mayor Sander, and City Councilmembers February 17, 2023

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the Alexander Collection Subdivision within the ZSPA, established a special police tax and park renovation fees for the Alexander Collection Subdivision, and (pursuant to the duration limits of Section 65865.3(a) applicable to newly incorporated cities) duly shortened the term of the Development Agreement from 20 years to 15 years from the original effective date.5 The 2004 Amendment also expressly provided that “[e]xcept as expressly amended by this Amendment, all of the terms, conditions, and provisions of the Development Agreement remain in full force and effect.” (See 2004 Amendment, at ¶ G.)

2. The 2010 Amendment acknowledged that the
Development Agreement remained in full force and effect.

On January 19, 2010, nearly seven years after the City’s incorporation, the City and Elliott Homes, Inc. executed the second amendment to the Development Agreement (“2010 Amendment”, a true and correct copy of which is attached hereto as Exhibit C). The 2010 Amendment removed 30 acres from the Zinfandel Special Plan Area and from the territory governed by the Development Agreement. Like the 2004 Amendment, the 2010 Amendment noted that “[e]xcept as expressly amended by this amendment, all of the terms, conditions and provisions of the Development Agreement remain in full force and effect.” (2010 Amendment, at ¶ D.)

3. The 2016 Amendment further extended the term of
the Development Agreement to June of 2023 and again acknowledged that the Development Agreement remained in full force and effect.

Finally, on or about August 1, 2016, over 13 years after the City’s incorporation, the City and Elliott Homes, Inc. executed the third amendment to the Development Agreement (“2016 Amendment”, a true and correct copy of which is attached hereto as Exhibit D). The 2016 Amendment changed the land use and zoning designations and standards that applied to the Veranda at Stone Creek subdivision within the ZSPA. The 2016 Amendment, plainly negotiated and made at a time when the City was no longer “newly incorporated”, also extended the term of the Agreement from 15 to 20 years, which was the original effective term of the Agreement when made with the County. (2016 Amendment, at ¶ C.) Again, the 2016 Amendment acknowledged that “[e]xcept as expressly amended by this amendment, all of the terms, conditions and provisions of the Development Agreement remain in full force and effect.” (2016 Amendment, at ¶ E.) The City Council’s repeated approval of amendments to the Development Agreement, while recognizing that its unamended terms, conditions, and provisions continued in full force and effect, obviously further underscores that the

5 While that was, pursuant to LAFCO’s resolution, apparently the maximum term that the newly incorporated City could at that time agree to, as discussed below, a subsequent amendment made in 2016, well over a decade after the City’s incorporation, further extended the Development Agreement’s term until June of 2023.

ITEM 11.1.

ATTACHMENT 2

Mayor Budge, Vice Mayor Sander, and City Councilmembers February 17, 2023

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Development Agreement remained valid and effective after the City’s incorporation.

Per the terms of the 2016 Amendment, which was freely negotiated between Elliott Homes and the City, at a time when the City had been incorporated for well over a decade, the Development Agreement will continue in effect until June of 2023, twenty years after the original effective date.

Nothing submitted in the two-page “clarifying” third Smith letter has any impact on any of the foregoing legal or factual analysis or conclusions. Smith’s citation and quotation of a secondary source’s cursory “pop-out” characterization of portions of Section 65865.3 does not avail her, and changes none of this letter’s (or our prior letters’) analysis and conclusions; in short, Smith’s argument is merely rephrased, but amounts to the same meritless contention: development agreements not “inherited” under Section 65865.3, i.e., to which the statute does not apply, are automatically null and void.

The only claim in the third letter perhaps warranting a further response is that “the longest statutorily allowed extension is limited to 15 years” and thus “even under the most expansive reading of the law, the agreement expired in 2018.” In addition to all the reasons set forth above why Smith’s reading of the statute is incorrect, she also ignores that subdivision (a)’s term duration limitations are clearly intended, on the face of the statute, to apply only in the context of a “newly incorporated city” or “newly annexed area”. Here, by contrast, the 2016 Amendment that she argues was inconsistent with the statute, and therefore ineffective, was made nearly one-and- one-half decades after the City’s incorporation, and thus at a time when it was no longer “newly incorporated” but, rather, a fully mature, long-incorporated City well into its second decade of existence.

Moreover, for reasons explained in more detail in this letter’s next section, and even assuming—contrary to the law and facts as accurately analyzed above, and solely for the sake of argument—that Ms. Smith’s analysis was correct, the Development Agreement and all of its amendments (including the 2016 Amendment) would nevertheless remain legally valid and beyond any challenge because the 90-day statute of limitations on any challenge expired in late 2016, over 7 years ago. (See Section IV, below.) Any possible way in which the Smith letters’ arguments challenging the validity of the Development Agreement arguments are viewed, they—like her other CEQA and land use arguments—lack merit.

IV. The statutory deadlines to challenge the Development Agreement and its amendments expired many years ago.

If Ms. Smith or the Project opponents wished to challenge the Development Agreement, or any of the three amendments to it (all of which were duly approved by the City upon the advice and counsel of its City Attorney), the time for them to have done so was when the Agreement and/or its amendments were approved many years ago.

ITEM 11.1.

ATTACHMENT 2

Mayor Budge, Vice Mayor Sander, and City Councilmembers February 17, 2023

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The statute of limitations applicable to such challenges is clearly set forth in Government Code section 65009(c)(1)(D), which provides in relevant part:
…no action or proceeding shall be maintained in any of the following cases by any person unless the action or proceeding is commenced and service is made on the legislative body within 90 days after the legislative body’s decision:

To attack, review, set aside, void, or annul the decision of a legislative body to adopt, amend, or modify a development agreement. An action or proceeding to attack, review, set aside, void, or annul the decisions of a legislative body to adopt, amend, or modify a development agreement shall only extend to the specific portion of the development agreement that is the subject of the adoption, amendment, or modification. This paragraph applies to development agreements, amendments, and modifications adopted on or after January 1, 1996.
(Gov. Code, § 65009(c)(1)(D), emph. added.)6
The County of Sacramento adopted the Development Agreement nearly twenty years ago. More than six-and-one-half years ago, on August 1, 2016, the City Council approved the third and most recent amendment of the Development Agreement, which extended the term of the Development Agreement to twenty years after its effective date – June of 2023. The 2016 Amendment was then duly recorded with the Sacramento County Clerk. At no point in 2016 or even 2017 did Project opponents or anyone else object to or challenge the Council’s noncontroversial consent calendar approval of the 2016 Amendment. Ms. Smith’s current claims challenging the validity and/or continuing effect of the Development Agreement are not only unexhausted and wholly without any substantive merit, but they are also several years too late and absolutely time-barred in any event.

V. The second Smith letter’s claims regarding the City’s General Plan are baseless.

The second Smith letter also argues that the City’s General Plan somehow does not “adequately address current state laws and standards”. As I wrote in our February 6

6 Upon the expiration of the time limits provided for in the statute, “all persons are barred from any further action or proceeding”. (Gov. Code, § 65009(e).) The paramount need for certainty and finality in land use actions is at the core of the statute. The purpose of Section 65009’s 90-day time limit is to bar untimely legal actions or proceedings challenging development approvals and amendments because such actions or proceedings have a “chilling effect on the confidence with which property owners and local governments can proceed with projects.” As the Legislature acknowledged, such legal actions or proceedings “can prevent the completion of needed developments even though the projects have received required governmental approvals.” Section 65009’s statutory deadlines therefore “provide certainty for property owners and local governments” regarding local government decisions to adopt or amend development agreements. (See Gov. Code, § 65009(a)(2)-(3).) ITEM 11.1.

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Mayor Budge, Vice Mayor Sander, and City Councilmembers February 17, 2023

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letter, this argument fails for the fundamental reason – among others – that the Development Agreement remains in full force and effect. Therefore, by the Development Agreement’s terms, the Project is only subject to those applicable development standards in the County’s General Plan, ZSPA, and incorporated zoning standards that were in effect in 2003.

Even apart from this, with the exclusion of certain obligations related to a city’s housing element, cities in California are not required to update their general plans at any given interval or in connection with any given event, including (but not limited to) a change in state laws or regulations. (See, e.g., Garat v. City of Riverside (1991) 2 Cal.App.4th 259 [rejecting argument that city’s 18-year old general plan was out of date because not based on modern environmental, safety, and other data], disapproved on other grounds in Morehart v. County of Santa Barbara (1994) 7 Cal.4th 725; see also Gov. Code, § 65358(b) [generally providing that mandatory elements of a general plan shall not be amended more than four times in a calendar year].) State law certainly does not require a city to revise or update its general plan every time the Legislature adopts a new law or every time a state agency adopts a new regulation. The overwhelming burdens this would place on cities throughout the state are obvious and such a requirement would fundamentally upend the governing practices of cities and counties throughout the state. Further, if Project opponents wish to challenge the City’s General Plan as inadequate, the proper time for them to have done so was at the time the General Plan language in question was adopted or when such language was amended. Any challenges not timely brought after such trigger dates are also absolutely time-barred by the applicable 90-day statute of limitations. (See Gov. Code, § 65009(c)(1)(A).)
VI. The Second Smith letter’s Repeated CEQA Claims Continue to Lack Merit.

Again, the second Smith letter repeats arguments from the first letter that the Supplemental EIR for the ZSPA is somehow “unlawfully stale”. As set out in detail in my January 25, 2023 letter to the Council, and reiterated in my February 6 letter, the claim that CEQA contains some uncodified requirement that an allegedly stale EIR be updated whenever some allegedly new information becomes available is simply wrong as a matter of law and fundamentally misunderstands CEQA’s subsequent review rules. CEQA establishes a strong presumption against further environmental review after an EIR is certified, and no such further environmental review is warranted here, as the City’s staff has consistently and correctly recognized.

VII. Conclusion
In conclusion, and as we have previously and repeatedly advised, the Development Agreement remains in full force and effect and it continues to bind the City, as the successor in interest to the County, to the benefits and burdens of the Agreement.

Unfortunately, the second Smith letter – like the first – fails to properly analyze the applicable law and fails address the material facts discussed above, apparently based on a failure to investigate the relevant facts or the public record that would ITEM 11.1.

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Mayor Budge, Vice Mayor Sander, and City Councilmembers February 17, 2023

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readily disclose such facts. The third Smith letter contains nothing of substance that is new, and does nothing that changes the fundamental failings of the second letter.

If the City were to deny the continuing existence of the Development Agreement and its amendments, duly approved by this Council upon the advice of the City Attorney, it would be recklessly exposing itself to litigation with the risk of incurring significant monetary damages and attorneys’ fees. The second Smith letter’s remaining arguments, regarding the City’s General Plan and CEQA review, are also meritless, for reasons explained above and previously.

As Dermody has consistently and correctly asserted throughout this too-lengthy Project design review approval process, the Development Agreement requires the City to reach a final decision and approve the Project, as presented fully to the Council on January 17, 2023, without further delay.

Thank you for your anticipated attention to these important matters.

Very truly yours,

MILLER STARR REGALIA

Arthur F. Coon

AFC:/klw
encls: Exhibits A-D
cc: Micah Runner, City Manager (w/encls; [email protected]) Elizabeth Sparkman, Community Development Director, (w/encls; [email protected])
Adam Lindgren, City Attorney (w/encls; [email protected]) George Condon, Dermody Properties (w/encls; [email protected]) Lucy Crocker, Lucy & Company (w/encls; [email protected]) Michelle Smira, MMS Strategies (w/encls; [email protected]) Nadia L. Costa, Esq., Miller Starr Regalia ([email protected]) Travis A. Brooks, Esq., Miller Starr Regalia ([email protected]) ITEM 11.1.

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OFFICIAL BUSINESS
Document entitled to free recording
Government Code Section 6103

RECORDING REQUESTED BY AND
WHEN RECORDED, MAIL TO:

City of Rancho Cordova
3121 Gold Canal Drive
Rancho Cordova, CA 95670
Attn: Lillian Hare, City Clerk
(SPACE ABOVE THIS LINE RESERVED FOR RECORDER'S USE)

AMENDMENT TO THE VILLAGES OF ZINFANDEL

DEVELOPER AGREEMENT
by and between the

CITY OF RANCHO CORDOVA
and
ELLIOTT HOMES, INC.

RELATIVE TO VILLAGES OF ZINFANDEL

ALEXANDER COLLECTION SUBDIVISION
ITEM 11.1.

ATTACHMENT 2

AMENDMENT TO THE VILLAGES OF ZINFANDEL DEVELOPMENT AGREEMENT 95-CZB-DGB-Z0B-SDB-TSM-0533
This AMENDMENT TO DEVELOPMENT AGREEMENT ("Amendment") is entered into as of August 2, 2004 by and between ELLIOTT HOMES, INC., a corporation of the State of Arizona ("Developer"), and the CITY OF RANCHO CORDOVA, a municipal corporation ("City"), who hereby agree as follows:

WHEREAS, this Amendment revises "The Villages of Zinfandel Development Agreement" ("Development Agreement"), entered into on May 28, 2003 between Elliott Homes and the County of Sacramento, a subdivision of the State of California, and recorded in Book 20030408, page 2493. The Development Agreement allocates rights and responsibilities of the County and Developer with respect to the mixed-use community development called The Villages of Zinfandel (the "Villages of Zinfandel Project"), on approximately 671.39 acres of property (the "Property") within the Villages at Zinfandel Special Planning Area (the "Zinfandel SPA") in the City, as described in Exhibit A to the Development Agreement.

WHEREAS, pursuant to section 1.7 of the Development Agreement, the parties may mutually agree to amend the Development Agreement as it applies to any portion of the Villages of Zinfandel Project.

WHEREAS, this Amendment concerns that portion of the Villages of Zinfandel development known as the "Alexander Collection Subdivision", consisting of 196 single-family residential units on approximately 29.7 acres of land, as further defined by the legal description, and as highlighted on the map, both of which are attached hereto as Exhibit A.

WHEREAS, on December 15, 2003, the City approved a General Plan Amendment reflecting a change in the land use designation of the Alexander Collection Subdivision from Medium Density Residential to Low Density Residential, by adopting Resolution No. 82-2003.

WHEREAS, on December 15, 2003, the City amended the Zinfandel SPA in the City's Zoning Code, from Medium Density Residential to Low Density Residential, by adopting Ordinance 29-2003.

WHEREAS, the City approved the Vesting Tentative Subdivision Map for the Alexander Collection Subdivision, subject to certain Conditions of Approval, Condition 19 of which requires modification of land use designations described in the Development Agreement in order to reflect the aforementioned changes, and requires Developer to pay an annual special tax for police services for the purpose of mitigating the additional demands on the City's law enforcement services resulting from development of the Alexander Collection Subdivision.

WHEREAS, the City and Developer also wish to amend the term of the Development Agreement and provide for the payment by Developer of a park renovation fee. 686288_2
ITEM 11.1.

ATTACHMENT 2

NOW, THEREFORE, in further consideration of the above recitals, and pursuant to Section 1.7 of the Development Agreement, Developer and City hereby agree to modify the Development Agreement as follows:

A. "Exhibit B" of the Development Agreement, entitled "Land Use Map", shall be replaced with the revised map, attached hereto as Exhibit B, which depicts the mutually agreed upon change of the General Plan designation of the Alexander Collection Subdivision from "Medium Density Residential" to "Low Density Residential." B. "Exhibit C" of the Development Agreement, entitled "Zinfandel Special Planning Area", shall be modified as follows: Section 512-215 of the County Zoning Code, entitled "Zinfandel Land Use Plan", shall be replaced with the revised Section 512-215, attached hereto as Exhibit C, which reflects the mutually agreed upon change in land use of the Alexander Collection Subdivision from "Medium Density Residential" to "Low Density Residential."
C. The followifig provisions shall be added to Section 3 of the Development Agreement, entitled "Developer Obligations":

3.4. Police Services. The Developer agrees to vote in favor of, and to cooperate in, the creation of a special tax zone area within the Rancho Cordova Special Police Tax Area. The boundaries of the special tax zone area shall be contiguous with the boundaries of the Alexander Collection Subdivision. The Developer shall vote in favor of and cooperate in the levy of a special tax for police services on each residential parcel or residential parcel equivalent on the Alexander Collection Subdivision. The special tax shall be in the amount of two hundred fifty dollars ($250) annually per residential parcel or residential parcel equivalent. The amount of the special tax shall be adjusted annually based upon the percentage change in the United States Department of Labor Consumer Price Index for All Urban Consumers for the San Francisco-Oakland-San Jose, California area between April and April of each year. If the Consumer Price Index is discontinued, or revised, such other government index or computation with which it is replaced shall be used in order to obtain substantially the same result as would be obtained if the Consumer Price Index had not been discontinued or revised. The special tax shall be payable annually following issuance of the building permit for each subject parcel. The Developer shall pay all the costs of conducting the election and all costs related to the implementation of this paragraph for development of the Alexander Collection Subdivision.

3.5. Existing Park Renovation Fees. Developer agrees that it shall pay the City the total sum of seven hundred thirty three dollars ($733) for each residential parcel or residential parcel equivalent shown on the final maps for the Property. Beginning on January 1, 2006, the fee shall be adjusted annually on each January 1 based upon the percentage change in the United States Department of Labor Consumer Price Index for All Urban Consumers for the San Francisco-Oakland-San Jose, California area between August and August of each year.

This fee shall be paid to the City no later than prior to issuance of the building permit for each residential parcel for the Property. It shall be used by the City, at its sole discretion to renovate, repair, improve or maintain existing parks in the City. This payment is made voluntarily by the Developer. It is in addition to all other existing park fees, and construction and dedication obligations, including without limitation any fees paid pursuant to California Government Code Section 66477 (the "Quimby Act"). Developer agrees that it shall not claim any credit or right to reimbursement of any other existing park fees, and construction and dedication 2 ITEM 11.1.

ATTACHMENT 2

By:
obligations, including Quimby Act fees as a result of paying the existing park renovation fees required under this Section.

D. Section 1.6 of the Development Agreement shall be amended and restated in its entirety as follows:

Term. The term of this Agreement shall commence on the Effective Date of the ordinance authorizing the approval and execution of this Agreement and shall extend for a period of fifteen (15) years from that date unless it is terminated, modified or extended by the circumstances set forth in this Agreement or by the mutual agreement of the parties.

E. The first and second sentences of Section 7.1(a) of the Development Agreement shall be amended and restated in their entirety as follows:

Termination. This Agreement shall be deemed terminated and of no further effect upon the occurrence of any of the following events:
(a) Expiration of the fifteen (15) year term.

F. This Amendment may be executed in several counterparts, each of which shall be deemed an original and all of which shall constitute but one and the same instrument.

G. Except as expressly amended by this Amendment, all of the terms, conditions and provisions of the Development Agreement remain in full force and effect.

IN WITNESS WHEREOF, the parties have duly signed this Amendment to the Development Agreement as of the date first written above.

Approved as to form

CITY OF RANCHO CORDOVA,
a municipal corporation
Attest:

Lillian Hare
City Clerk
686288_2
3 ITEM 11.1.

ATTACHMENT 2

CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
()Y-,4\?."):/.: •
V
State of California
County of SACRAMENTO
On NOVEMBER 17, 2004 before me, SHERI HASSELL, NOTARY PUBLIC Date Name and Title of Officer (e g , "Jane Doe, Notary Public") HARRY C. ELLIOTT, III personally appeared
Name(s) of Signer(s)
IC personally known to me
LI proved to me on the basis of satisfactory
evidence
rrtfatrti HASSELL
COMM. #1436607
Notary Public-California U/
SACRAMENTO COUNTY lt
y,C,0 rn, .,Ex, p,. Sept ,2 4,, 2, 0 0 7, 1
to be the person {s-) whose name(s)
subscribed to the within instrument and
acknowledged to me that he/ohc/thcy executed
the same in his/fritritheir authorized
capacitycwas.), and that by histher4lIvir
signatureiey. on the instrument the person, or
the entity upon behalf of which the person4}
acted, executed the instrument.
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OPTIONAL
Though the information below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent removal and reattachment of this form to another document Description of Attached Document AMENDMENT TO THE VILLAGES OF ZINFANDEL DEVELOPMENT AGREEMENT 95–CZB–DGB–Z0B–SDB–TSM-0533 Title or Type of Document:

Document Date: AUGUST 2, 2004
Signer(s) Other Than Named Above:

Capacity(ies) Claimed by Signer
Signer's Name. HARRY C. ELLIOTT , III

RIGHT THUMBPRINT

OF SIGNER
O Individual
E Corporate Officer — Title(s): PRESIDENT
O Partner —71Limited LI General
O Attorney-in-Fact
LI Trustee
Li Guardian or Conservator
E Other:

Top of thumb here

Signer Is Representing: ELLIOTT HONES, INC.

O 1999 National Notary Association • 9350 De Solo Ave . P0 Box 2402 • Chatsworth, CA 91313-2402 • wow nationalnotary org Prod No 5907 Reorder Call Toll-Free 1-500-576-6827 ITEM 11.1.

ATTACHMENT 2

Public Agency Form of Acknowledgement

STATE OF CALIFORNIA

COUNTY OF SACRAMENTO
On November 16, 2004, before me, Anna Olea-Moger, Assistant City Clerk for the City of Rancho Cordova, personally appeared Linda Budge, personally known to me to be the person whose name is subscribed to the within instrument and acknowledged to me that she executed the same in her authorized capacity of Mayor of the City of Rancho Cordova, and that by her signature on the instrument the person, or the entity upon behalf of which she acted, executed the instrument.

Witness my hand and official seal.
11/1(
Anna Olea-Moger, Assista pity Clerk
Description of Attached Document
Development Agreement — Elliott Homes, Inc. Relative to Villages of Zinfandel Alexander Collection Subdivision
ITEM 11.1.

ATTACHMENT 2

LIST OF EXHIBITS TO AMENDMENT
Exhibit A - Legal Description of Alexander Collection Subdivision; Map of Villages of Zinfandel Unit No. 8 (Alexander Collection Subdivision) Exhibit B - General Plan Amendment (Map)
Exhibit C - Land Use Exhibit (Rezone of Zinfandel Special Planning Area--County Zoning Code Section 512-215)
4 ITEM 11.1.

ATTACHMENT 2

EXHIBIT 'A'

LEGAL DESCRIPTION
All of Lot 3 as shown on the Final Map of Villages of Zinfandel Unit No. 9, recorded in Book 317 of Maps, at Page 7, Sacramento County Records, in the City of Rancho Cordova, County of Sacramento, State of California.

April 7, 2004

END OF DESCRIPTION
PREPARED BY WOOD RODGERS, INC.

SACRAMENTO, CALIFORNIA
5 ITEM 11.1.

ATTACHMENT 2

GENERAL PLAN AMENDMENT

ALEXANDER COLLECTION
AT

STONE CREEK

RANCHO CORDOVA, CALIFORNIA

EXISTING GENERAL PLAN
SMEARY:

PROPOSED GENERAL PLAN
MUM:

LOY MOTT REOIDENTIAL
MIMI DEN= 101210424TIAL
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20.4 AC. 7.4 AC.

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LW DIRECT 208301OTIAL 00.i Ac.

TOTAL: 00.0 AC.
bzPrEILBER 15. 2003
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ITEM 11.1.

ATTACHMENT 2

REVISED. APED. .7, .2004
OCTOBER 7, 2002
JUNE 'Zoo 2-
W
C:C;WALUCt CTCA/IFORMA, INC.

Zitgleii:ii/PUlusanOsin*,
ITEM 11.1.

ATTACHMENT 2

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Map of Villages of Zinfandel Unit No. 8
(Alexander Collection Subdivision)
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EXHIBIT C
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Description: Sacramento,CA Document - Book.Page 20160308.1060 Page: 1 of 10 Order: 1046797 Comment:

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EXHIBIT D
ITEM 11.1.

ATTACHMENT 2

CITY OF RANCHO CORDOVA
ORDINANCE NO. 6-2016

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF RANCHO CORDOVA

APPROVING A THIRD AMENDMENT TO THE VILLAGES OF ZINFANDEL DEVELOPMENT AGREEMENT BETWEEN THE CITY OF RANCHO CORDOVA AND ELLIOTT HOMES, INC.

RELATIVE TO THE VERANDA AT STONE CREEK SUBDIVISION

THE CITY COUNCIL OF THE CITY OF RANCHO CORDOVA DOES ORDAIN AS FOLLOWS:

Section 1: Recitals
A. To strengthen the public planning process, encourage private participation in comprehensive planning and reduce the economic risk of development, the Legislature of the State of California adopted Section 65864, et seq., of the Government Code (the "Development Agreement Statute"), which authorizes the City and any person having a legal or equitable interest in the real property to enter into a development agreement establishing certain development rights in the property which is the subject of the development project application.

B. On May 28, 2003, the County of Sacramento("County") and Elliott Homes, Inc. ("Elliott") entered into a development agreement for the Villages of Zinfandel Project ("Project"), which is located south of the intersection of International Drive and Zinfandel Drive, within the Zinfandel Special Planning Area ("Special Planning Area").

C. Having duly examined and considered the Villages of Zinfandel development agreement for the Project and having held properly noticed public hearings, the County found that the Agreement satisfied the Government Code §65867.5 requirement of the general plan.

D. The City, as a result of its incorporation, succeeded to the County of Sacramento's interests in the Villages of Zinfandel development agreement (the development agreement together with any subsequent amendment by the County or City to the agreement shall be referred to as "Development Agreement"). The City Council approved two prior amendments to the Development Agreement, one in 2004 and another in 2009.

E. In 1998 the County certified as adequate and complete the Final Villages of Zinfandel Environmental Impact Report ("Villages of Zinfandel FEIR") for the Project. Mitigation measures were required in the Villages of Zinfandel FEIR and are incorporated into the Project and into the terms and conditions of the approved Tentative Map for the Veranda at Stone Creek subdivision.

F. Pursuant to the California Environmental Quality Act, the City has performed an Initial Study and issued an Addendum to the Villages of Zinfandel FEIR for the Veranda at Stone Creek subdivision project, which concluded that: The proposed Veranda at Stone Creek subdivision within the Project, with 112 fewer dwelling units and an unchanged development footprint than was previously approved for the site, would not create any new, substantially more severe, or additional significant impacts that were not already identified in the previously certified Villages of Zinfandel FEIR; nor would it cause any impacts peculiarly to the project or parcels. Mitigation measures relating to these impact areas included in the Villages of Zinfandel FEIR and General Plan FEIR are Ordinance No. 6-2016 Page 1 of 3
ITEM 11.1.

ATTACHMENT 2

still applicable to the Veranda at Stone Creek subdivision project and would reduce impacts to the furthest extent feasible.

G. The City Council has considered all comments received in writing and all testimony received at the properly noticed public hearing related to this Amendment.

Section 2: Findings and Determinations
Therefore, on the basis of (a) the foregoing Recitals, which are incorporated herein, (b) the City of Rancho Cordova's General Plan, (c) the Zinfandel Special Planning Area document, (d) the County's certified Villages of Zinfandel FEIR, and (e) the approved Tentative Map and corresponding Conditions of Approval for the Veranda at Stone Creek subdivision, the City Council finds and determines that:

A. Finding: The Third Amendment to the Development Agreement ("Amendment"), which amends the land use map to reflect the new Low Density Cluster land use designation for the Veranda at Stone Creek ("Veranda") site and extends the Development Agreement by five years, is consistent with the objectives, policies, goals, general land uses and programs specified and contained in the City's General Plan, and in the Zinfandel Special Planning Area ("ZSPA").

Evidence: The land use designation for the Veranda site under the General Plan is Medium Density Residential and Low Density Cluster under the ZSPA. The proposed Veranda subdivision would create 163 single-family homes in a style and density that is consistent with such land use designations. This is consistent with the fiscal policies of the General Plan and the ZSPA with respect to provision of infrastructure and public services, as the Development Agreement includes provisions relating to financing, construction and maintenance of public facilities, park development fees and similar provisions set forth in the ZSPA. This Amendment does not alter any of these components of the Project. Additionally, the Low Density Cluster land use, consisting of homes on smaller lots with alley access, would provide another type of ownership housing not currently available in the ZSPA and create a neighborhood that promotes pedestrian circulation .

These elements of the Veranda subdivision further the goals of the General Plan and the ZSPA to provide a diverse housing stock in the region, to improve the jobs-to-housing ratio in the area, and to create pedestrian-friendly neighborhoods.

B. Finding: The Amendment is in conformity with public convenience, general welfare and good land use policies in that the Project, including the Veranda subdivision, will implement land use guidelines set forth in the ZSPA and the General Plan, which have planned for residential uses at this location.

Evidence: The Amendment does not alter any land uses already approved by the City Council for this site via the General Plan and the ZSPA; it simply replaces the land use map exhibit to the Development Agreement to reflect the Low Density Cluster zoning designation approved by Ordinance 5-2016 on August 1 st, 2016.

C. Finding: The Amendment will not be detrimental to the health, safety and general welfare in that the Project, including the Veranda subdivision, will proceed in accordance with all the programs and policies of the ZSPA.

Evidence: The impacts of the development on existing land uses, public services and the environment have been evaluated and mitigated through the CEQA compliance process.

Ordinance No. 6-2016 Page 2 of 3
ITEM 11.1.

ATTACHMENT 2

D. Finding: The Amendment will not adversely affect the orderly development of property or the preservation of property values.

Evidence: The Amendment is consistent with the General Plan and ZSPA, as shown above.

E. Finding: The Amendment is consistent with the provisions of Government Code Sections 65864 through 65869.5.

Evidence: The Amendment does not alter the previously approved substantive elements of the Development Agreement and has been processed consistent with all the procedural requirements of Government Code Sections 65864 through 65869.5.

Section 3: Approval
The City Council hereby approves the Third Amendment to the Development Agreement (Exhibit 3A) and authorizes the Mayor to execute it.

Section 4: Recordation
Within ten (10) days after the Third Amendment to the Development Agreement is executed by the Mayor and Developer, the City Clerk shall submit the Agreement to the County Recorder for recordation.

Section 5. Effective Date and Publication of Ordinance Summary This Ordinance shall take effect and be in force thirty (30) days from and after the date of its passage. The City Clerk of the City of Rancho Cordova shall cause a summary of the Ordinance to be posted in accordance with Section 36933 of the Government Code of the State of California.

PASSED AND ADOPTED by the City Council of the City of Rancho Cordova on the 1st day of August, 2016 by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

Budge, McGarvey, Skoglund, Terry
None
Sander
None
/— Donald Terry, Vice Mayor
ATTEST:

Mindy Cuppy,
2662940.1
2662940.2
Ordinance No. 6-2016 Page 3 of 3
ITEM 11.1.

ATTACHMENT 2

DRAFT
EXHIBIT 3A

OFFICIAL BUSINESS
Document entitled to free recording
Government Code Section 6103

RECORDING REQUESTED BY
AND
WHEN RECORDED, MAIL TO:

City of Rancho Cordova
2729 Prospect Park Drive
Rancho Cordova, CA 95670
Attention: City Clerk
(SPACE ABOVE THIS LINE RESERVED FOR

RECORDER'S USE)

THIRD AMENDMENT TO VILLAGES OF ZINFANDEL

DEVELOPMENT AGREEMENT
by and between the

CITY OF RANCHO CORDOVA
and
ELLIOTT HOMES, INC.

RELATIVE TO VILLAGES OF ZINFANDEL

VERANDA AT STONE CREEK SUBDIVISION
ITEM 11.1.

ATTACHMENT 2

DRAFT
EXHIBIT 3A

THIRD AMENDMENT TO THE VILLAGES OF ZINFANDEL DEVELOPMENT

AGREEMENT
95-CZB-DGB-Z0B-SDB-TSM-0533
This THIRD AMENDMENT TO DEVELOPMENT AGREEMENT ("Amendment") is entered into as of , 2016, by and between ELLIOTT HOMES, INC., a corporation of the State of Arizona ("Developer"), and the CITY OF RANCHO CORDOVA, a California municipal corporation ("City"), who hereby agree as follows:

WHEREAS, this Amendment revises "The Villages of Zinfandel Development Agreement" ("Development Agreement"), entered into on May 28, 2003, between Elliott Homes and the County of Sacramento, a subdivision of the State of California, and recorded in Book 20030408, page 2493. The Development Agreement allocates rights and responsibilities of the County and Developer with respect to the mixed-use community development called The Villages of Zinfandel ("Villages of Zinfandel Project"), on approximately 671.39 acres of property ("Property") within the Zinfandel Special Planning Area ("Zinfandel SPA") in the City, as described in Exhibit A to the Development Agreement; and WHEREAS, pursuant to section 1.7 of the Development Agreement, the parties may mutually agree to amend the Development Agreement as it applies to any portion of the Villages of Zinfandel Project; and
WHEREAS, the Development Agreement was amended on August 2, 2004 to reflect the rezone of the property related to the Alexander Collection Subdivision within the Villages of Zinfandel Project from "Medium Density Residential" to "Low Density Residential," to reduce the term of the Development Agreement by five (5) years, and to reflect desired changes related to Developer obligations related to fees; and
WHEREAS, the Development Agreement was amended a second time on January 19, 2010 to remove approximately thirty (30) acres of land from the Villages of Zinfandel Project and Development Agreement to reflect the State of California's purchase of the land from the Developer; and
WHEREAS, this Amendment concerns that portion of the Villages of Zinfandel development known as the "Veranda at Stone Creek Subdivision" ("Veranda") consisting of 163 single-family residential units on approximately 17.18 acres of land on Spoto Drive, as further defined by the legal description, and as highlighted on the map, both of which are attached hereto as Exhibit A; and
WHEREAS, this Amendment replaces the Land Use Map exhibit to the Development Agreement and is necessary to reflect the rezone of the 17.18 acres for the Veranda subdivision from "Medium Density" to "Low Density Cluster" accomplished via City Council Ordinance No. 5-2016, adopted on • 2016, amending the Zinfandel SPA; and 2 ITEM 11.1.

ATTACHMENT 2

DRAFT
EXHIBIT 3A
WHEREAS, this Amendment also extends the term of the Development Agreement by five (5) years, amending the expiration date to the expiration date of the original agreement — 2023.

NOW, THEREFORE, in further consideration of the above recitals, and pursuant to Section 1.7 of the Development Agreement, Developer and City hereby agree to modify the Development Agreement as follows:

A. "Exhibit B" of the Development Agreement, entitled "Land Use Map," shall be replaced with the revised map, attached hereto as Exhibit B, which depicts the mutually agreed upon change of the Veranda at Stone Creek parcel from "Medium Density" to "Low Density Cluster."
B. "Exhibit C" of the Development Agreement, entitled "Zinfandel Special Planning Area," shall be replaced with the amended Zinfandel Special Planning Area Document approved by the City Council via Ordinance No. 5-2016.

C. Section 1.6 of the Development Agreement shall be amended and restated in its entirety as follows:

Term. The term of this Agreement shall commence on the Effective Date of the ordinance authorizing the approval and execution of this Agreement, and shall extend for a period of twenty (20) years from that date unless it is terminated, modified or extended by the circumstances set forth in this Agreement or by the mutual agreement of the parties. D.

This Amendment may be executed in several counterparts, each of which shall be deemed an original and all of which shall constitute but one and the same instrument.

E. Except as expressly amended by this Amendment, all of the terms, conditions and provisions of the Development Agreement remain in full force and effect.

IN WITNESS WHEREOF, the parties have duly signed this Amendment to the Development Agreement as of the date first written above.

CITY OF RANCHO CORDOVA,
Approved as to form a municipal corporation
By:

By:

Adam U. Lindgren David M. Sander
City Attorney Mayor
Attest:

Mindy Cuppy, CMC
City Clerk
3 ITEM 11.1.

ATTACHMENT 2

DRAFT EXHIBIT 3A
ELLIOTT HOMES, INC.,
A corporation of the State of Arizona
By:

Harry C. Elliott III
President
4 ITEM 11.1.

ATTACHMENT 2

DRAFT
EXHIBIT 3A

LIST OF EXHIBITS TO AMENDMENT
Exhibit A - Legal Description of Veranda Subdivision; Map of Villages of Zinfandel Unit Exhibit B - Land Use Exhibit (Rezone of Zinfandel Special Planning Area--County Zoning Code Sections 512-215)
5 ITEM 11.1.

ATTACHMENT 2

DRAFT
EXHIBIT 3A

EXHIBIT 'A'

LEGAL DESCRIPTION
All of Lot 4 as shown on the Final Map of Villages of Zinfandel Unit No. 9, recorded in Book 317 of Maps, at Page 7, Sacramento County Records, in the City of Rancho Cordova, County of Sacramento, State of California.

July ,2016

END OF DESCRIPTION
PREPARED BY WOOD RODGERS, INC.

SACRAMENTO, CALIFORNIA
2661774.1
2661774.2
6 ITEM 11.1.

ATTACHMENT 2

DRAFT
EXHIBIT 3A

EXHIBIT 'B'

LAND USE EXHIBIT
7 ITEM 11.1.

ATTACHMENT 2

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Existing Zoning: 0
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Existing Zoning: BP
EXHIBIT 3A
Rezone for
Veranda at Stone Creek
Ranch Cordova, CA
AUGUST, 2015 Page 1 of 1 Scale: 1"450'
Existing Zoning \ Proposed Zoning \

VICINITY MAP

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Zoning: LOG
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Existing Zoning: RC

LDC (ZSPA)
Existing Zoning: 0 ASSESSOR' S PARCEL NUMBER: 072-2360-004 EXISTING ZONING: MD ( ZSPA)
PROPOSED ZONING: LDC (ZSPA)
SITE AREA: 17.18± ACRES ( GROSS)
Existing Zoning: 0

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ITEM 11.1.

ATTACHMENT 2

MEMORANDUM

City Council Staff Report - Page 1 of 2

ITEM 12.1.

DATE: February 21, 2023

TO: Honorable Mayor and Council Members

FROM: Stefan Heisler, Housing Manager
Kristine Courdy, Senior Civil Engineer

SUBJECT: MILLS CROSSING PROJECT UPDATE

RECOMMENDATION

Receive presentation, provide feedback.

RESULT OF RECOMMENDED ACTION

The City Council will receive a presentation from the City’s master developer team, Griffin Swinerton and partners, and city staff regarding the current project status, the 2023 work plan and anticipated community outreach this calendar year.

BACKGROUND

On July 18, 2022, the City Council approved execution of a Predevelopment Agreement with Griffin Swinerton to continue moving the Mills Crossing project forward into the detailed design phase. This phase is intended to scope out the project in sufficient detail to negotiate a Guaranteed Maximum Price and Development Agreement by early 2025.

Several work streams are now in progress to meet this goal. This project update presentation will inform the City Council regarding the upcoming work planned for calendar year 2023 to formally name the project, refine the site plan, define an architectural character, discuss outdoor area programming, and involve residents in these conversations at several planned outreach events. This update will also inform Council on the current California Environmental Quality Act (CEQA) review, ongoing soil remediation, and grant applications submitted, awarded, and anticipated. Finally, Griffin Swinerton will provide an update on the progress attracting potential users who will anchor and fill the future individual spaces within the site plan.

The major features of the approved concept plan include 80,000-100,000 sq ft of community facilities focused on arts, wellness, events, small business incubator and workforce training uses, approximately 2.5 acres of plaza and community green spaces, approximately 120 housing units of attached townhomes and multifamily apartments, and a 3-level, approximately 300 space, parking garage.

FISCAL IMPACT AND FUNDING SOURCE

There is no fiscal impact for this discussion.

ATTACHMENT(S)

City Council Staff Report - Page 2 of 2

1. Presentation

MILLS CROSSING
City Council Update
February 21, 2023
• • •
Pending:
2020-22
Completion:
2026-27
In Progress:
2022-25
ITEM 12.1.

ATTACHMENT 1

AGENDA

3. In Brief | Project Overview

1. Introduction

4. In Focus | Design Progress

2. Community Engagement

5. Next Steps
An Innovative Public Private Partnership:

ITEM 12.1.

ATTACHMENT 1

IMPORTANT NOTE BEFORE WE DIVE IN . . .

The updated concepts, plans,
and images in this
presentation are provided to
initiate additional dialogue
with the City, Council, &
Community .

These updates are not
“etched in stone”
The eventual designs and
programming will result from
an ongoing dialogue and
feedback from these key
stakeholders – today’s update
is an important step in that
direction
ITEM 12.1.

ATTACHMENT 1

1. Introduction • • •
Pending:
2020-22
Completion:
2026-27
In Progress:
2022-25
ITEM 12.1.

ATTACHMENT 1

MILLS CROSSING | Community Amenity | Economic Development Master Plan Approved December 2021
ITEM 12.1.

ATTACHMENT 1

FEEDBACK:

As We Work Towards a May 2023 Design Charrette
UPDATE:

On the 5 Major Work Streams

WHAT WE AIM TO ACCOMPLISH
1 2
ITEM 12.1.

ATTACHMENT 1

Process /
Approvals
Design &
Engineering
Project
Financing
Community
Engagement
Operations &
Occupancy
Overall Schedule, CEQA, Planning/Subdivision, etc.
5 MAJOR WORK STREAMS
1 2
3 4
5 Master Plan and Public Spaces, Community-Commercial, Housing, Parking Structure Financing Plan, Grants, NMTCs, City Investment, Bonds, etc.

Community Workshops, Design Charrettes, etc.

Operations “Civic Curator”, Project Occupants / Programming Partners ITEM 12.1.

ATTACHMENT 1

2. Community
Engagement
• • •
Pending:
2020-22
Completion:
2026-27
In Progress:
2022-25
ITEM 12.1.

ATTACHMENT 1

Community
Engagement
Process /
Approvals
Design &
Engineering
Project
Financing
Operations &
Occupancy
5 MAJOR WORK STREAMS
1 2
3 4
5 Design
Charrettes
Pop-Up
Workshops
Surveys,
Social Media
Videos & Photos
Community Workshops
May
2023
ITEM 12.1.

ATTACHMENT 1

COMMUNITY OUTREACH CALENDAR
March April May June July August September October November Design Charrette Pop-Up Workshops (4) Community Celebration Surveys, Social Media Videos & Photos
Throughout entire outreach process
2023
Community Workshops (3)
ITEM 12.1.

ATTACHMENT 1

DESIGN CHARRETTE | MAY 2023
Design Character
Project Name
Outdoor Events, Programming
Housing Opportunities
How to Stay Involved
ITEM 12.1.

ATTACHMENT 1

3. In Brief
Project Overview
• • •
Pending:
2020-22
Completion:
2026-27
In Progress:
2022-25
ITEM 12.1.

ATTACHMENT 1

Process /
Approvals
Design &
Engineering
Project
Financing
Community
Engagement
Operations &
Occupancy
5 MAJOR WORK STREAMS
1 2
3 4
5 CEQA / Supplemental EIR
now
Schematic Design Design DevelopmentProgram Verification 12 months
Q4 2023
Financing Plan, Grants, NMTCs, City Investment, Bonds, etc.

Community Workshops, Design Charrettes, etc.

Operations “Civic Curator”, Project Occupants / Programming Partners GMP
ITEM 12.1.

ATTACHMENT 1

MASTER PLAN | 3d 360 ° Model
Design &
Engineering
2 ITEM 12.1.

ATTACHMENT 1

MASTER PLAN | 3d 360 ° Model
Design &
Engineering
2 ITEM 12.1.

ATTACHMENT 1

MASTER PLAN | 3d 360 ° Model
Design &
Engineering
2 ITEM 12.1.

ATTACHMENT 1

MASTER PLAN | 3d 360 ° Model
Design &
Engineering
2 ITEM 12.1.

ATTACHMENT 1

Master Plan Site Design Refinement
Design &
Engineering
2 ITEM 12.1.

ATTACHMENT 1

Contemporary
/Contextual
Traditional
/Historical
Progressive
/Forward-thinking
ARCHITECTURAL CHARA CTER | Spectrum
Design &
Engineering
2 ITEM 12.1.

ATTACHMENT 1

Right-Sized:

Health + Wellness: 20,000 sf
Community Commercial: 25,000 sf
Total: 45,000sf
Refined:

Health + Wellness: 20,000 sf
Community Commercial: 25,000 sf
Revised Total: 45,000sf
MASTER PLAN | Refined Building Details
Design &
Engineering
2 ITEM 12.1.

ATTACHMENT 1

Classroom
Art Studio
Design &
Engineering
2 Black Box Theater

PROGRAM VALIDATION
Arts Center
ITEM 12.1.

ATTACHMENT 1

Incubator Kitchen
Maker Space
Activity Room
Classroom
Office
Design &
Engineering
2PROGRAM VALIDATION
Community -Commercia l
ITEM 12.1.

ATTACHMENT 1

Process /
Approvals
Design &
Engineering
Project
Financing
Community
Engagement
Operations &
Occupancy
5 MAJOR WORK STREAMS
1 2
3 4
5 Augmenting the City’s Investment with Grants
and New Markets Tax Credits (NMTCs)
Awarded
(2 Grants)
$7.5
Million
SACOG named Mills Crossing one of the
Sacramento Region’s Top 10 of 2022
Pending
Opportunities
~$9
Million
• • •Applications
Submitted
$24.1
Million
ITEM 12.1.

ATTACHMENT 1

Community
Engagement
Process /
Approvals
Design &
Engineering
Project
Financing
Operations &
Occupancy
5 MAJOR WORK STREAMS
1 2
3 4
5 Design
Charrettes
Pop-Up
Workshops
Surveys,
Social Media
Videos & Photos
Community Workshops
May
2023
ITEM 12.1.

ATTACHMENT 1

Community
Engagement
Process /
Approvals
Design &
Engineering
Project
Financing
“ANCHOR TENANTS”
1 2
3 4
Operations &
Occupancy
5 Community
Arts Center
Office /
Health Center
Community Hub
& Retail
25,000 SF – Anchor Office User
20,000 SF – Community Health Center
4,000 SF – Commercial Kitchen/Incubator
9,000 SF – Community Event Hall
30,000 SF – Diversified Community Space
3,500 SF – Retail
15,000 SF – 300-Seat Black Box Theater
20,000 SF – Studios, Exhibit, Classrooms
ITEM 12.1.

ATTACHMENT 1

Community
Engagement
Process /
Approvals
Design &
Engineering
Project
Financing
“ANCHOR TENANTS”
1 2
3 4
Operations &
Occupancy
5 Community
Arts Center
Office /
Health Center
Community Hub
& Retail
25,000 SF – Anchor Office User
20,000 SF – Community Health Center
4,000 SF – Commercial Kitchen/Incubator
9,000 SF – Community Event Hall
30,000 SF – Diversified Community Space
3,500 SF – Retail
15,000 SF – 300-Seat Black Box Theater
20,000 SF – Studios, Exhibit, Classrooms
ITEM 12.1.

ATTACHMENT 1

Process /
Approvals
Design &
Engineering
Operations &
Occupancy
5 MAJOR WORK STREAMS
1 2
5 CEQA / Supplemental EIR
Program Verification
12 months
Community
Engagement
4 Project
Financing
3 2-4 Grant Applications
Ongoing Community Outreach
May
2023
Q4 2023
Operations “Civic Curator”, Project Occupants / Programming Partners ITEM 12.1.

ATTACHMENT 1

4. In Focus
Design Progress
• • •
Pending:
2020-22
Completion:
2026-27
In Progress:
2022-25
ITEM 12.1.

ATTACHMENT 1

DESIGNS ARE CONCEPTUAL
To be programmed
and detailed with City,
Council, & Community
Feedback and
Collaboration
LOOKING AHEAD:

As We Work Towards a May 2023 Design Charrette
ITEM 12.1.

ATTACHMENT 1

Community
Engagement
Program
VerificationCEQA
Landscape &
Outdoor
Program
Verification
Site Design Refinements – Primary Inputs
ITEM 12.1.

ATTACHMENT 1

Two primary open spaces, a vibrant plaza
and a project green, separated by an internal
road
Example Site Refinement
ITEM 12.1.

ATTACHMENT 1

Two primary open spaces, a vibrant plaza
and a project green, separated by an internal
road
Example Site Refinement | Open Space
ITEM 12.1.

ATTACHMENT 1

Community garden
Outdoor dining
Nature trail
Orchard
Outdoor classroom
Market/ Plaza
Sports courts
OUTDOOR SPACES | A Variety of Opportunities
Stroll gardens
Pop up space
Meditation/ Yoga
Picnic area
Nature play
Vernal pool
Water feature
Wellness Walk
ITEM 12.1.

ATTACHMENT 1

CEQA:

Health + Wellness: 27,000 sf
Community Commercial: 25,000 sf
Total: 52,000sf
Right-Sized:

Health + Wellness: 20,000 sf
Community Commercial: 25,000 sf
Revised Total: 45,000sf
MASTER PLAN | Right -sizing
ITEM 12.1.

ATTACHMENT 1

Right-Sized:

Health + Wellness: 20,000 sf
Community Commercial: 25,000 sf
Total: 45,000sf
Refined:

Health + Wellness: 20,000 sf
Community Commercial: 25,000 sf
Revised Total: 45,000sf
MASTER PLAN | Refined Building Details
ITEM 12.1.

ATTACHMENT 1

Classroom
Art Studio
Black Box Theater

PROGRAM VALIDATION
Arts Center
ITEM 12.1.

ATTACHMENT 1

Incubator Kitchen
Maker Space
Activity Room
Classroom
Office

PROGRAM VALIDATION
Community -Commercia l
ITEM 12.1.

ATTACHMENT 1

Event Space + Catering Kitchen
Multipurpose Room`Meeting Room
Event Space + Catering Kitchen
PROGRAM | Events Hall
ITEM 12.1.

ATTACHMENT 1

Whole Person Community Clinic
Outpatient Clinic
PROGRAM | Health + Wellness
ITEM 12.1.

ATTACHMENT 1

~300 Parking Spaces
PROGRAM | Parking Structure
ITEM 12.1.

ATTACHMENT 1

Contemporary
/Contextual
Traditional
/Historical
Progressive
/Forward-thinking
Character | Spectrum
ITEM 12.1.

ATTACHMENT 1

• Inspired by the past, re-in terpreted for today
• Using traditional forms with modern materials
Contemporary
/Contextual
Traditional
/Historical
Progressive
/Forward-thinking
Character | Traditional
ITEM 12.1.

ATTACHMENT 1

Contemporary
/Contextual
Traditional
/Historical
Progressive
/Forward-thinking
• Inspired by the community and its context
• Re
sponding to place
• Looking to the future, but grounded by the past
Character | Contemporary/Contextual
ITEM 12.1.

ATTACHMENT 1

• At the forefront of design and technology
• High-tech materials and finishes
• S
ustainability on display
Contemporary
/Contextual
Traditional
/Historical
Progressive
/Forward-thinking
Character | Progressive/Forward -thinking
ITEM 12.1.

ATTACHMENT 1

5. Next Steps • • •
Pending:
2020-22
Completion:
2026-27
In Progress:
2022-25
ITEM 12.1.

ATTACHMENT 1

Process /
Approvals
Design &
Engineering
Operations &
Occupancy
5 MAJOR WORK STREAMS
1 2
5 CEQA / Supplemental EIR
Program Verification
12 months
Community
Engagement
4 Project
Financing
3 2-4 Grant Applications
Ongoing Community Outreach
May
2023
Q4 2023
Operations “Civic Curator”, Project Occupants / Programming Partners ITEM 12.1.

ATTACHMENT 1

DESIGN CHARRETTE | MAY 2023
Design Character
Project Name
Outdoor Events, Programming
Housing Opportunities
How to Stay Involved
ITEM 12.1.

ATTACHMENT 1

MEMORANDUM

City Council Staff Report - Page 1 of 2

ITEM 12.2.

DATE: February 21, 2023

TO: Honorable Mayor and Council Members

FROM: Albert Stricker, Public Works Director
Drew Hart, Senior Transportation Planner

SUBJECT: PROPOSED NEIGHBORHOOD TRAFFIC MANAGEMENT PROGRAM,

PHASE VI

RECOMMENDATION

Receive staff presentation and provide comments on the proposed Phase VI Neighborhood Traffic Management Program (NTMP).

RESULT OF RECOMMENDED ACTION

Staff will incorporate City Council direction and proceed with the final design process.

BACKGROUND

The City Council adopted the NTMP manual in 2006, which established a process for selecting and prioritizing neighborhoods and specific street locations for installation of traffic calming measures. The first step to initiating an NTMP project is resident submission of a petition to the City with a minimum of 10 signatures in support of traffic calming. Staff then collects vehicle speeds, traffic volumes, and accident history to report to the Neighborhood Traffic Safety Committee (NTSC). The NTSC consists of representatives of Rancho Cordova citizens, Sacramento Metropolitan Fire, Rancho Cordova Police and Public Works.

The NTSC reviews the proposed projects, recommends approval or denial, and prioritizes approved petitions based on criteria outlined in the NTMP. The final step in the NTMP approval process is mailing a ballot to affected residents. A minimum of 25% of the ballots must be returned with at least 67% approval for a specific traffic calming measure to proceed with bidding and construction.

The proposed Phase VI traffic calming measures included in Attachments 1 and 2 were recommended for approval by the NTSC. The proposed scopes were vetted at neighborhood meetings to present the proposed Phase VI projects, solicit feedback, and answer questions.

The majority of resident comments were supportive of the NTMP project, with some key discourse focused on the severity of speeding, enforcement, and location of proposed devices.

Staff incorporated resident comments into the proposed scopes shown in Attachment 2. In subsequent months, the ballots were mailed out, collected, and tallied. All seven locations in this Phase VI package received sufficient votes from responding residents.

City Council Staff Report - Page 2 of 2

The estimated total cost of the Phase VI Neighborhood Traffic Management project is $310,000. Staff will incorporate direction provided by Council in the final design phase of these individual locations. Bidding and construction are scheduled for the end of 2023.

FISCAL IMPACT AND FUNDING SOURCE

This current fiscal year budget for the NTMP is $300,000. The funding sources include New Measure A Construction, Measure A - Streets, Bike, & Ped Program, and the Capital Infrastructure Fund. This project will have no impact on the General Fund.

ATTACHMENT(S)

1. Proposed Traffic Calming Features

2. Map of Citywide Traffic Calming Project

3. NTMP Phase VI Presentation

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PALO VISTA WAY

FOLSOM BLVD
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Feet ²
Proposed Traffic
Calming Measures*
Dawes St & Malaga Way
Project Street
Existing Features
!? Crosswalk
!(èüéëìí Traffic Signal
ÊÉh4 Speed Hump
Proposed Traffic Calming Device
ÉÉB Bulb-Out
Proposed Striping
Striped Crosswalk
*Traffic calming measures depicted on this map are conceptual and subject to minor change.

ITEM 12.2.

ATTACHMENT 1

ITEM 12.2.

ATTACHMENT 1

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ROUTIER RD

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ROUTIER RD

ABRAHAM

LINCOLN

ELEMENTARY

LINCOLN VILLAGE

COMMUNITY PARK
0 150 300
Feet ²
Proposed Traffic
Calming Measures*
Ellenwood Ave
Project Street
Existing Features
!? Crosswalk
!(èüéëìí Traffic Signal
Proposed Traffic Calming Devices
ÊÉh4 Speed Bump
*Traffic calming measures depicted on this map are conceptual and subject to minor change.

ITEM 12.2.

ATTACHMENT 1

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RUBY LANDING WAY

SUNRISE BLVD
HERON

LANDING
PARK
0 100 200
Feet ²
Proposed Traffic
Calming Measures*
Justinian Dr
Project Street
Existing Features
!? Crosswalk
!(èüéëìí Traffic Signal
Proposed Traffic Calming Devices
1237 "25 MPH" Speed Sign
ÉÉB Bulb-Out
ÊÉh4 Speed Bump
Proposed Striping
High Visibility Crosswalk
Shared Parking/Bike Lane
*Traffic calming measures depicted on this map are conceptual and subject to minor change.

ITEM 12.2.

ATTACHMENT 1

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MALAGA WAY

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GILBERT WAY

BLUESTAR
CT

GARRETTW
AY

SILVERWOOD WAY

LA RUE WAY

BUENA PLAZA CIR

MILLS ACRES CIR

WHITE ROCK RD

INVESTMENT CIR

FOLSOM BLVD

WHITE ROCK RD

COLOMA RD

WHITE ROCK

ELEMENTARY
WHITE

ROCK COMMUNITY
PARK
0 250 500
Feet ²
Proposed Traffic
Calming Measures*
Mills Tower Dr
Project Street
Existing Features
!? Crosswalk
!(èüéëìí Traffic Signal
Proposed Traffic Calming Devices
1237 "25 MPH" Speed Sign
ÊÉh4 Speed Bump
Proposed Striping
5' Bike, 7' Parking, 10' Travel Lane
*Traffic calming measures depicted on this map are conceptual and subject to minor change.

ITEM 12.2.

ATTACHMENT 1

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CAPITALES DR

LA PRESAWAY

LA GRAMA DR EL LUJO WAY

EL SEGUNDO DR

KINGFISHER WAY

ELCANTO
CIR

ELCHICO CIR

SOBRANTE

WAYEL CHORLITO DR
PALO
VISTA
WAY

ELPAVOWAY
BETTEN

COURTLN

ELCAPRICEDR
LA
CU
M
BR
A
CIR

ELPARQUECIR

RANCHO CORDOVA CITY LIMITS
M

ILLSSTATION RD
ROD

BEAUDRY
DR

TERRA LOM
A
DR

LA ALEGRIADR

LA VERTA CT

ETIFFANY
LN

UNNAMED RD

FOLSOM BLVD

CORDOVA

MEADOWS

ELEMENTARY
AM
ERICAN
RIVER
FOLSOM

LAKE STATE

RECREATION AREA
TAYLOR
PARK
RIVER
BEND
PARK

WILLIAM POND

RECREATION
AREA
Sacramento
County
0 400 800
Feet ²
Proposed Traffic
Calming Measures*
W La Loma Dr
Project Street
Existing Features
!? Crosswalk
!(èüéëìí Traffic Signal
ÆÆý Raised Crosswalk
Proposed Traffic Calming Devices
1237 "25 MPH" Speed Sign
ÉÉB Bulb-Out
ÊÉh4 Speed Bump
*Traffic calming measures depicted on this map are conceptual and subject to minor change.

ITEM 12.2.

ATTACHMENT 1

CHARBONO WAY

ALICANTE WAY

CABERNETW
AY

CHASSELLA
W

AY ZINFANDELDR
0 50 100
Feet ²
Proposed Traffic
Calming Measures*
Zinfandel Dr
Project Street
Proposed Traffic Calming Devices
ÊÉo44 Speed Lump
*Traffic calming measures depicted on this map are conceptual and subject to minor change.

ITEM 12.2.

ATTACHMENT 1

DAWES ST/

MALAGA WAY

ELLENWOOD AVE

MILLS TOWER DR

EDINGTON DR

W LA LOMA DR

ZINFANDEL DR

JUSTINIAN DR

MATHER AIRPORT

FOLSOM LAKE

STATE RECREATION
AREA
MATHER
GOLF
COURSE
MATHER

REGIONAL
PARK
ANCIL

HOFFMAN
PARK
ANCIL

HOFFMAN

GOLF COURSE
RIVER
BEND
PARK

WILLIAM POND

RECREA TION
AREA
AM
ERICAN
RIVER

ZINFANDELDR

FOLSOM BLVD

COLOMARD

ROUTIER
RD

BRADSHAW
RD

SUNRISE BLVD

OLD PLACERVILLERD

DOUGLAS RD
M

ATHERFIELDRD

WHITE ROCK RD

INTERNATIONAL D R

RANCHO CORDOVA PKWY

GRANT LINE RD
(/50
·|}þ16
Sacramento
County
Path: X:\GIS_Staff\PROJECTS\PUBLIC_WORKS\TRANSPORTATION\TRAFFIC\NTMP\2021\Traffic Calming\NTMP_ProposedTrafficCalming_OverviewSlide_Phase_VI.mxd | Date: 1/31/2023 0 0.5 1
Miles ²
NTMP Project Phase VI
NTMP Project Street
ITEM 12.2.

ATTACHMENT 2

1 Neighborhood Traffic
Management Project
Phase VI
February 21, 2023
CityOfRanchoCordova.org
ITEM 12.2.

ATTACHMENT 3

2 MEETING GOALS
• Review NTMP process.
– How we got here. Who is involved.
• Receive input from City Council.

ITEM 12.2.

ATTACHMENT 3

3 Neighborhood Traffic Management (NTMP) Background
• Provides a means for residents to request traffic
calming.
• Established a committee (NTSC) to review and
prioritize requests.
– NTSC comprised of Fire Dept, Police Dept,
residents and City Staff.
• Sets threshold for ballots to ensure the community
has consensus prior to installation.
– 25% min response rate, 67% approval rate.

ITEM 12.2.

ATTACHMENT 3

4 Types of Treatment
 High Visibility Crosswalk
 Solar Powered
School Crossing Sign
 Enhanced Striping
 Bulbout
 Speed Hump
 Speed Feedback Sign
ITEM 12.2.

ATTACHMENT 3

5 What Does This Mean to the Community
• Slower vehicles.
• Better Pedestrian Connections.
• Safer neighborhoods.
Safe, Inviting, and Livable
Co
mmunities.

ITEM 12.2.

ATTACHMENT 3

6 City Wide Project Locations
ITEM 12.2.

ATTACHMENT 3

7 Dawes St and Malaga Way NTMP Improvement Plan
Proposed Improvements
• Bulbouts
• High Visibility Crosswalk
Striping
ITEM 12.2.

ATTACHMENT 3

8 Edington Dr NTMP Improvement Plan
Proposed
Improvements
• Speed Limit Sign
• Speed Feedback Sign
• Speed Hump / Lump
ITEM 12.2.

ATTACHMENT 3

9 Ellenwood Ave NTMP Improvement Plan
Proposed Improvements
• Speed Hump / Lump
ITEM 12.2.

ATTACHMENT 3

10 Justinian Dr NTMP Improvement Plan
Proposed Improvements
• Speed Hump / Lump
• Bulbouts
• High Visibility Crosswalk
Striping
• Enhanced Striping -
Shared Parking and Bike
Lane
ITEM 12.2.

ATTACHMENT 3

11 Mills Tower Dr NTMP Improvement Plan
Proposed Improvements
• Speed Hump / Lump
• Enhanced Striping –
– Bike and Parking lane
• Speed Limit Signs
ITEM 12.2.

ATTACHMENT 3

12 W La Loma Dr NTMP Improvement Plan
Proposed Improvements
• Speed Hump / Lump
• Bulbouts
• Speed Limit Signs
ITEM 12.2.

ATTACHMENT 3

13 Zinfandel Dr NTMP Improvement Plan
Proposed Improvements
• Speed Hump / Lump
ITEM 12.2.

ATTACHMENT 3

14 Next Steps
• Incorporate comments from this meeting
• Contract with a designer to create Design Plans
• Finalize Construction Documents and Begin Construction Questions and Input
ITEM 12.2.

ATTACHMENT 3