Rancho Cordova City Council
June 5, 2023

Updated September 2022
8 • Accounting for all reasonably foreseeable greenhouse gas emissions from the project, without discounting projected emissions based on participation in California’s Cap-and-Trade Program.

Examples of measures to mitigate air quality and greenhouse gas impacts from construction are below. To ensure mitigation measures are enforceable and effective, they should be imposed as permit conditions on the project where applicable. • Requiring off-road construction equipment to be hybrid electric-diesel or zeroemission, where available, and all diesel-fueled off-road construction equipment to be equipped with CARB Tier IV-compliant engines or better, and including this requirement in applicable bid documents, purchase orders, and contracts, with successful contractors demonstrating the ability to supply the compliant construction equipment for use prior to any ground-disturbing and construction activities.
• Prohibiting off-road diesel-powered equipment from being in the “on” position for more than 10 hours per day.
• Using electric-powered hand tools, forklifts, and pressure washers, and providing electrical hook ups to the power grid rather than use of diesel-fueled generators to supply their power.
• Designating an area in the construction site where electric-powered construction vehicles and equipment can charge.
• Limiting the amount of daily grading disturbance area. • Prohibiting grading on days with an Air Quality Index forecast of greater than 100 for particulates or ozone for the project area.
• Forbidding idling of heavy equipment for more than three minutes. • Keeping onsite and furnishing to the lead agency or other regulators upon request, all equipment maintenance records and data sheets, including design specifications and emission control tier classifications. • Conducting an on-site inspection to verify compliance with construction mitigation and to identify other opportunities to further reduce construction impacts.
• Using paints, architectural coatings, and industrial maintenance coatings that have volatile organic compound levels of less than 10 g/L.
• Providing information on transit and ridesharing programs and services to construction employees.
• Providing meal options onsite or shuttles between the facility and nearby meal destinations for construction employees.

Examples of measures to mitigate air quality and greenhouse gas impacts from operation include:
• Requiring all heavy-duty vehicles engaged in drayage22 to or from the project site to be zero-emission beginning in 2030.
22 “Drayage” refers generally to transport of cargo to or from a seaport or intermodal railyard.

ITEM 18.1. ATTACHMENT 5

Updated September 2022
9 • Requiring all on-site motorized operational equipment, such as forklifts and yard trucks, to be zero-emission with the necessary charging or fueling stations provided.
• Requiring tenants to use zero-emission light- and medium-duty vehicles as part of business operations.
• Forbidding trucks from idling for more than three minutes and requiring operators to turn off engines when not in use.
• Posting both interior- and exterior-facing signs, including signs directed at all dock and delivery areas, identifying idling restrictions and contact information to report violations to CARB, the local air district, and the building manager. • Installing solar photovoltaic systems on the project site of a specified electrical generation capacity that is equal to or greater than the building’s projected energy needs, including all electrical chargers.
• Designing all project building roofs to accommodate the maximum future coverage of solar panels and installing the maximum solar power generation capacity feasible.
• Constructing zero-emission truck charging/fueling stations proportional to the number of dock doors at the project.
• Running conduit to designated locations for future electric truck charging stations. • Unless the owner of the facility records a covenant on the title of the underlying property ensuring that the property cannot be used to provide refrigerated warehouse space, constructing electric plugs for electric transport refrigeration units at every dock door and requiring truck operators with transport refrigeration units to use the electric plugs when at loading docks.
• Oversizing electrical rooms by 25 percent or providing a secondary electrical room to accommodate future expansion of electric vehicle charging capability. • Constructing and maintaining electric light-duty vehicle charging stations proportional to the number of employee parking spaces (for example, requiring at least 10% of all employee parking spaces to be equipped with electric vehicle charging stations of at least Level 2 charging performance) • Running conduit to an additional proportion of employee parking spaces for a future increase in the number of electric light-duty charging stations. • Installing and maintaining, at the manufacturer’s recommended maintenance intervals, air filtration systems at sensitive receptors within a certain radius of facility for the life of the project.
• Installing and maintaining, at the manufacturer’s recommended maintenance intervals, an air monitoring station proximate to sensitive receptors and the facility for the life of the project, and making the resulting data publicly available in real time. While air monitoring does not mitigate the air quality or greenhouse gas impacts of a facility, it nonetheless benefits the affected community by providing information that can be used to improve air quality or avoid exposure to unhealthy air.
• Requiring all stand-by emergency generators to be powered by a non-diesel fuel. • Requiring facility operators to train managers and employees on efficient scheduling and load management to eliminate unnecessary queuing and idling of ITEM 18.1. ATTACHMENT 5

Updated September 2022
10 trucks.
• Requiring operators to establish and promote a rideshare program that discourages single-occupancy vehicle trips and provides financial incentives for alternate modes of transportation, including carpooling, public transit, and biking. • Meeting CalGreen Tier 2 green building standards, including all provisions related to designated parking for clean air vehicles, electric vehicle charging, and bicycle parking.
• Designing to LEED green building certification standards. • Providing meal options onsite or shuttles between the facility and nearby meal destinations.
• Posting signs at every truck exit driveway providing directional information to the truck route.
• Improving and maintaining vegetation and tree canopy for residents in and around the project area.
• Requiring that every tenant train its staff in charge of keeping vehicle records in diesel technologies and compliance with CARB regulations, by attending CARBapproved courses. Also require facility operators to maintain records on-site demonstrating compliance and make records available for inspection by the local jurisdiction, air district, and state upon request.
• Requiring tenants to enroll in the United States Environmental Protection Agency’s SmartWay program, and requiring tenants who own, operate, or hire trucking carriers with more than 100 trucks to use carriers that are SmartWay carriers.
• Providing tenants with information on incentive programs, such as the Carl Moyer Program and Voucher Incentive Program, to upgrade their fleets.

VI. Noise Impacts Analysis and Mitigation
The noise associated with logistics facilities can be among their most intrusive impacts to nearby sensitive receptors. Various sources, such as unloading activity, diesel truck movement, and rooftop air conditioning units, can contribute substantial noise pollution. These impacts are exacerbated by logistics facilities’ typical 24-hour, seven-days-per-week operation. Construction noise is often even greater than operational noise, so if a project site is near sensitive receptors, developers and lead agencies should adopt measures to reduce the noise generated by both construction and operation activities.

Examples of best practices when studying noise impacts include:
• Preparing a noise impact analysis that considers all reasonably foreseeable project noise impacts, including to nearby sensitive receptors. All reasonably foreseeable project noise impacts encompasses noise from both construction and operations, including stationary, on-site, and off-site noise sources. • Adopting a lower significance threshold for incremental noise increases when baseline noise already exceeds total noise significance thresholds, to account for the cumulative impact of additional noise and the fact that, as noise moves up the decibel scale, each decibel increase is a progressively greater increase in sound ITEM 18.1. ATTACHMENT 5

Updated September 2022
11 pressure than the last. For example, 70 dBA is ten times more sound pressure than 60 dBA.
• Disclosing and considering the significance of short-term noise levels associated with all aspects of project operation (i.e. both on-site noise generation and off-site truck noise). Considering only average noise levels may mask noise impacts sensitive receptors would consider significant—for example, the repeated but short-lived passing of individual trucks or loading activities at night.

Examples of measures to mitigate noise impacts include:
• Constructing physical, structural, or vegetative noise barriers on and/or off the project site.
• Planning and enforcing truck routes that avoid passing sensitive receptors. • Locating or parking all stationary construction equipment as far from sensitive receptors as possible, and directing emitted noise away from sensitive receptors. • Verifying that construction equipment has properly operating and maintained mufflers.
• Requiring all combustion-powered construction equipment to be surrounded by a noise protection barrier
• Limiting operation hours to daytime hours on weekdays. • Paving roads where truck traffic is anticipated with low noise asphalt. • Orienting any public address systems onsite away from sensitive receptors and setting system volume at a level not readily audible past the property line.

VII. Traffic Impacts Analysis and Mitigation
Warehouse facilities inevitably bring truck and passenger car traffic. Truck traffic can present substantial safety issues. Collisions with heavy-duty trucks are especially dangerous for passenger cars, motorcycles, bicycles, and pedestrians. These concerns can be even greater if truck traffic passes through residential areas, school zones, or other places where pedestrians are common and extra caution is warranted.

Examples of measures to mitigate traffic impacts include:
• Designing, clearly marking, and enforcing truck routes that keep trucks out of residential neighborhoods and away from other sensitive receptors. • Installing signs in residential areas noting that truck and employee parking is prohibited.
• Requiring preparation and approval of a truck routing plan describing the facility’s hours of operation, types of items to be stored, and truck routing to and from the facility to designated truck routes that avoids passing sensitive receptors.

The plan should include measures for preventing truck queuing, circling, stopping, and parking on public streets, such as signage, pavement markings, and queuing analysis and enforcement. The plan should hold facility operators responsible for violations of the truck routing plan, and a revised plan should be required from any new tenant that occupies the property before a business license ITEM 18.1. ATTACHMENT 5

Updated September 2022
12 is issued. The approving agency should retain discretion to determine if changes to the plan are necessary, including any additional measures to alleviate truck routing and parking issues that may arise during the life of the facility. • Constructing new or improved transit stops, sidewalks, bicycle lanes, and crosswalks, with special attention to ensuring safe routes to schools. • Consulting with the local public transit agency and securing increased public transit service to the project area.
• Designating areas for employee pickup and drop-off.
• Implementing traffic control and safety measures, such as speed bumps, speed limits, or new traffic signs or signals.
• Placing facility entry and exit points on major streets that do not have adjacent sensitive receptors.
• Restricting the turns trucks can make entering and exiting the facility to route trucks away from sensitive receptors.
• Constructing roadway improvements to improve traffic flow. • Preparing a construction traffic control plan prior to grading, detailing the locations of equipment staging areas, material stockpiles, proposed road closures, and hours of construction operations, and designing the plan to minimize impacts to roads frequented by passenger cars, pedestrians, bicyclists, and other non-truck traffic.

VIII. Other Significant Environmental Impacts Analysis and Mitigation Warehouse projects may result in significant environmental impacts to other resources, such as to aesthetics, cultural resources, energy, geology, or hazardous materials. All significant adverse environmental impacts must be evaluated, disclosed and mitigated to the extent feasible under CEQA. Examples of best practices and mitigation measures to reduce environmental impacts that do not fall under any of the above categories include:
• Appointing a compliance officer who is responsible for implementing all mitigation measures, and providing contact information for the compliance officer to the lead agency, to be updated annually.
• Creating a fund to mitigate impacts on affected residents, schools, places of worship, and other community institutions by retrofitting their property. For example, retaining a contractor to retrofit/install HVAC and/or air filtration systems, doors, dual-paned windows, and sound- and vibration-deadening insulation and curtains.
• Sweeping surrounding streets on a daily basis during construction to remove any construction-related debris and dirt.
• Directing all lighting at the facility into the interior of the site. • Using full cut-off light shields and/or anti-glare lighting. • Requiring submission of a property maintenance program for agency review and approval providing for the regular maintenance of all building structures, landscaping, and paved surfaces.
• Using cool pavement to reduce heat island effects.

ITEM 18.1. ATTACHMENT 5

Updated September 2022
13 • Planting trees in parking areas to provide at least 35% shade cover of parking areas within fifteen years to reduce heat island impacts. • Using light colored roofing materials with a solar reflective index of 78 or greater. • Including on-site amenities, such as a truck operator lounge with restrooms, vending machines, and air conditioning, to reduce the need for truck operators to idle or travel offsite.
• Designing skylights to provide natural light to interior worker areas. • Installing climate control and air filtration in the warehouse facility to promote worker well-being.

IX. Conclusion
California’s world-class economy, ports, and transportation network position it at the center of the e-commerce and logistics industry boom. At the same time, California is a global leader in environmental protection and environmentally just development. The guidance in this document furthers these dual strengths, ensuring that all can access the benefits of economic development. The Bureau will continue to monitor proposed projects for compliance with CEQA and other laws. Lead agencies, developers, community advocates, and other interested parties should feel free to reach out to us as they consider how to guide warehouse development in their area.

Please do not hesitate to contact the Environmental Justice Bureau at [email protected] if you have any questions.

ITEM 18.1. ATTACHMENT 5

EXHIBIT D
ITEM 18.1. ATTACHMENT 5

DPML-58478\2688190.1
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
October 3, 2022

VIA E-MAIL
Mr. Cyrus Abhar
City Manager
City of Rancho Cordova
2729 Prospect Park Drive
Rancho Cordova, CA 95670
Email: [email protected]
Re: Dermody Industrial Properties – Appropriate Scope of CEQA Review for the Mather Blvd. Design Review Project
Dear Mr. Abhar:

As you know, this firm represents Dermody Properties in connection with its design review application for an approximately 155,077 square foot logistics center on a site located within the Zinfandel Special Planning Area (“ZSPA”), northwest of the intersection at North Mather Boulevard and Bear Hollow Drive (“Design Review Project”). As you are also well aware, the Design Review Project now before the City is fully consistent with the type, density and intensity of land use and development contemplated and authorized in the ZSPA planning document, and a Final Environmental Impact Report has been certified by the lead agency pursuant to CEQA that fully analyzed potential environmental impacts resulting from development within the ZSPA (“ZSPA FEIR”).

The Design Review Project requires the City’s approval of a “Major Design Review” application; therefore, given the limited scope and type of discretionary authority that the City is authorized to exercise at this stage of development under its local design review ordinance, we concur with the City’s determination that the Design Review Project qualifies for a streamlining exemption under CEQA Guidelines Section 15183.

We write to further augment the administrative record with respect to the appropriate scope of City’s environmental review of the Design Review Project under the California Environmental Quality Act (Pub. Res. Code § 21000 et seq.) and the CEQA Guidelines (CCR, Tit. 14, Div. 6, Chap. 3) (collectively, “CEQA”), which is strictly limited under the law to those design-related environmental effects that the City is authorized by its ordinance to address during its Major Design Review process. Here, the City’s Major Design Review process expressly limits the City’s ITEM 18.1. ATTACHMENT 5

Cyrus Abhar, City Manager
October 3, 2022

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discretion to deny or condition approval of the Design Review Project based solely on the effects of its design components, not other effects of the previously authorized uses and density and intensity of those uses at the site. In other words, the City is not at liberty to use its limited design review authority to revisit environmental issues previously analyzed and laid to rest by the prior certified ZSPA EIR.

Accordingly, it is entirely appropriate – and, indeed, to the extent that the City conducts any further CEQA review, legally required – for the City to apply CEQA Guidelines section 15183, which provides for a partial exemption and streamlined CEQA review of the Design Review Project. As explained in more detail below, and just as it has done for other similar recent design review projects, the City’s determination to rely upon Section 15183 for the Design Review Project is proper under the law, and furthermore any analysis conducted thereunder must be limited to any potential design-related effects peculiar to the Design Review Project that were not studied or analyzed in the ZSPA EIR.

I. For CEQA Purposes, The City May Only Analyze Those Potential Impacts Which It Has Authority And Discretion Under Its Design Review Ordinance To Meaningfully Address.

CEQA review is only triggered for “discretionary” projects, which are those that require a local agency to exercise meaningful judgment or deliberation in deciding whether or how to approve a proposed activity. The “touchstone” in determining whether a project is discretionary for CEQA purposes is “whether the approval process involved allows the government to shape the project in any way” which could meaningfully respond to environmental concerns recognized by CEQA. (CEQA Guidelines, § 15357; McCorkle Eastside Neighborhood Group v. City of St.

Helena (2018) 31 Cal.App.5th 80; Friends of Juana Briones House v. City of Palo Alto (2010) 190 Cal.App.4th 286.) “CEQA does not apply to an agency decision simply because the agency may exercise some discretion in approving the project or undertaking. Instead [,] to trigger CEQA compliance the discretion must be of a certain kind; it must provide the agency with the ability and authority to mitigate… environmental damage to some degree.” (Sierra Club v. County of Sonoma (2017) 11 Cal.App.5th 11, 23, quoting San Diego Navy Broadway Complex Coalition v. City of San Diego (2010) 185 Cal.App.4th 924, 934.) As our state Supreme Court recently stated, a project only requires CEQA review if the:
relevant approval process…allows the government to shape the project in any way by requiring modifications which could respond to any of the concerns which might be identified by environmental review. (Protecting Our Water and Environmental Resources v. County of Stanislaus (2020) 10 Cal.5th 479, 493 (“POWER”); see also Friends of Westwood, Inc. v. City of Los Angeles (1987) 191 Cal.App.3d 259, 270 [CEQA review would be wasteful and meaningless exercise if decision maker lacks relevant discretion under applicable ITEM 18.1. ATTACHMENT 5

Cyrus Abhar, City Manager
October 3, 2022

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law to deny or shape project through conditions to address environmental concerns revealed by the review].)
Where CEQA-triggering discretion exists, the scope of environmental review is limited to analyzing those environmental impacts that a local agency may actually address in its approval process. (McCorkle, supra, 31 Cal.App.5th at 89-90.) As the court in McCorkle noted:
the [CEQA] Guidelines recognize that the application of CEQA to a local ordinance is dependent upon the scope and interpretation of the local ordinance, rather than vice versa.
(Id. at 92.)
With regard to design review approvals like the instant one, where a city’s design review ordinance prevents it from disapproving or conditioning approval of a project for “non-design related reasons,” it lacks discretion to address non-design related effects through CEQA. (Id.; see also Friends of Davis v. City of Davis (2000) 83 Cal.App.4th 1004, 1010-15.) Relatedly, it is fundamental that CEQA does not confer independent power or authority on an agency to impose mitigation requirements or conditions on a project approval. Rather, when acting to mitigate or avoid a project’s significant effects on the environment, an agency may only exercise those express or implied powers provided by law other than CEQA, subject to the express or implied constraints or limitations of the other law. (Pub. Res.

Code, § 21004; see, e.g., Tiburon Open Space Committee v. County of Marin (2022) 78 Cal.App.5th 700 [scope of agency’s discretion, and hence scope of required CEQA review, is limited by constraints and obligations of other law].) II. The City’s Discretion Here Is Limited To Considering The Project’s Design Components.

As is apparent from review of the above-cited authorities, determining the existence and scope of an agency’s discretionary authority with respect to approval of a particular project requires careful analysis of the statute or ordinance authorizing and providing controls over the agency’s action. (Sierra Club v. Napa County Bd. of Sup’rs (2012) 205 Cal.App.4th 162; Sierra Club v. County of Sonoma, supra, 11 Cal.App.5th 11.) Here, the City’s review and approval of a Major Design Review application is governed by Chapter 23.141 of the City’s Municipal Code, which limits the City’s review of such applications to design-related issues.1 For projects requiring it, the purpose of the City’s design review process is to review “additional site and design considerations beyond conformance with minimum standards of the zoning code.” The intent of design review is “to promote orderly and harmonious 1 As will be discussed more fully in a letter sent by Miller Starr Regalia to the City under separate cover, the City’s ability to exercise discretion is also governed and further constrained by the vested rights granted to Dermody under the Development Agreement.

ITEM 18.1. ATTACHMENT 5

Cyrus Abhar, City Manager
October 3, 2022

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growth within the City.” (RCMC, § 23.141.010.) The City Council “may approve or approve with conditions” an application for major design review upon making the following findings:

A. The proposed project is consistent with the objectives of the General Plan, complies with applicable zoning regulations, Specific Plan provisions, and special planning area provisions, and is consistent with the applicable Rancho Cordova design guidelines.

B. The proposed architecture, site design, and landscape are suitable for the purposes of the building and the site and will enhance the character of the neighborhood and community.

C. The architecture, including the character, scale, and quality of the design, relationship with the site and other buildings, building materials, screening of exterior appurtenances, exterior lighting and signing, and similar elements, establishes a clear design concept and is compatible with the character of existing or anticipated buildings on adjoining and nearby properties.

D. The proposed project will not create conflicts with vehicular, bicycle, or pedestrian transportation modes of circulation.
(RCMC, § 23.141.070.)
The City’s ability to require modifications to project plans, or to condition approval of a Major Design Review application, is expressly limited to addressing a project’s design features:

The council may require modifications to plans in whole or in part and may condition the major design review application to ensure specific design features, construction materials, and conformance with all applicable [design review provisions].
(RCMC, § 23.141.080, emph. added.)
Pursuant to the above provisions, the City’s Major Design Review approval provisions constrain the City’s discretion and authority, and preclude its ability to deny or condition the Design Review Project to address environmental effects that are not related to its design. The City therefore lacks discretion to consider or impose conditions addressing the Design Review Project’s potential non-design related impacts, such as, for example, those involving greenhouse gas emissions, transportation, biological resources, and/or air quality impacts. (See, e.g., San Diego Navy Broadway Complex Coalition v. City of San Diego, supra, 185 Cal.App.4th 924 [city’s approval of construction plans for waterfront development was ministerial where approval required only determination whether plans were ITEM 18.1. ATTACHMENT 5

Cyrus Abhar, City Manager
October 3, 2022

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consistent with aesthetic criteria in urban design guidelines established in connection with redevelopment project reviewed and approved under earlier EIR; limited scope of city’s discretion in reviewing plans for conformity to guidelines’ aesthetic criteria did not give it ability to meaningfully respond to GHG and climate change impacts raised by project opponent]; McCorkle, supra, 31 Cal.App.5th at 94 [rejecting project opponent’s argument “that because the City had discretion to conduct design review the entire project was discretionary and subject to CEQA”]; Sierra Club v. County of Sonoma, supra, 11 Cal.App.5th 11 [vineyard development permit was ministerial where applicable regulations conferred no meaningful discretion to mitigate environmental damage].)
III. To the Extent Limited CEQA Review Is Required Here, The Design Review Project Qualifies For A Guidelines Section 15183 Partial Exemption And Streamlined Review.

As noted above, to the extent that CEQA applies to the Design Review Project, it qualifies for a CEQA Guidelines Section 15183 partial exemption for projects that are consistent with the densities/intensities established by the existing zoning, community plan, or general plan. Because an EIR was prepared and certified by the lead agency in accordance with CEQA, which covered full development of the Project site with the type and intensity of uses authorized when it adopted the ZSPA, the City’s additional CEQA review of the Design Review Project here must be narrowly limited to analysis of only the design review-related environmental effects of the Design Review Project (if any).

Moreover, any such CEQA review is further limited under Guidelines Section 15183 as follows:
(1) to those environmental effects that the city determines are peculiar to the project and were not studied in the EIR for the zoning, community plan, or general plan;
(2) to those environmental effects of the project that were not analyzed as significant effects in the EIR prepared for the general plan (or zoning action, or community plan);
(3) to potentially significant off-site impacts and cumulative environmental impacts of the project which were not discussed in the prior EIR prepared for the general plan (or zoning action or community plan); or (4) to previously identified significant effects which, as a result of substantial new information which was not known at the time the EIR was certified, are determined to have a more severe adverse impact than discussed in the prior EIR.

Here, the Design Review Project involves a land use that the ZSPA permits by right at the proposed density and intensity (also fully consistent with the ZSPA) — and for ITEM 18.1. ATTACHMENT 5

Cyrus Abhar, City Manager
October 3, 2022

DPML-58478\2688190.1
which Dermody has vested rights under the Development Agreement to proceed — and all environmental impacts of such use, density and intensity were fully disclosed, analyzed and mitigated as required under CEQA in the certified ZSPA FEIR. Thus, in addition to the legal limitations on the application and scope of CEQA inherent in the Major Design Review process itself, the application of a Guidelines Section 15183 exemption is also entirely appropriate and is exactly the CEQA compliance pathway that the City has followed for similar recent projects in the ZSPA.2
With regard to any potential design-related environmental effects peculiar to the Design Review Project, we note that the applicant has already prepared a thoughtful noise study to confirm that it would not have any new significant and/or peculiar noise impacts not already analyzed in the ZSPA FEIR. The Project will also be required to – and will – comply with all applicable mitigation measures under the ZSPA MMRP, which further ensures that the Design Review Project will not result in any peculiar or more severe impacts than already discussed in the ZSPA FEIR.

Among other things, the MMRP includes measures to mitigate any potentially significant biological impacts, air quality impacts, water quality impacts, and noise impacts.

Finally, we note that following the preparation and certification of an EIR, CEQA places strict limitations on conducting subsequent CEQA review of a project (the conditions for which are not met here), and prescribes no “expiration date” for an EIR (or for any relevant type CEQA document, for that matter). (See Pub. Res.

Code, § 21166 and CEQA Guidelines § 15162 [setting forth the limited situations where subsequent or supplemental review may be required after an EIR has been prepared]; see also Latinos Unidos v. City of Napa (2013) 221 Cal.App.4th 192 [upholding city’s reliance on decades-old general plan EIR when approving a new housing element and determining no new EIR was required]; Committee for ReEvaluation of T-Line Loop v. San Francisco Municipal Transportation Agency (2016) 6 Cal.App.5th 1237, 1254 [16-year old EIR held adequate CEQA compliance for light rail line project]; Snarled Traffic Obstructs Progress v. City and County of San Francisco (1999) 74 Cal.App.4th 793 [nearly decade-old negative declaration held adequate CEQA compliance for parking structure project].) In sum, here it is entirely appropriate to apply the Guidelines Section 15183 partial exemption and streamlined CEQA review to the Design Review Project based on 2 Within the ZSPA, the Project site has a land use designation of Business and Professional Office where the proposed warehousing, delivery, and distribution type use is permitted by right, not requiring approval of a conditional use permit. (ZSPA, § 512-204 (D).) The Design Review Project at issue here has also been carefully designed so as to ensure that the height and size of the proposed building, setbacks, and site improvements are consistent with the development standards set forth in the ZSPA. (See, e.g., Development Agreement, at § 2.1; ZSPA, § 512-204 (D); 2003 Zoning Ordinance at § 230, Table IV.)
ITEM 18.1. ATTACHMENT 5

Cyrus Abhar, City Manager
October 3, 2022

DPML-58478\2688190.1
the extensive CEQA review already conducted in the certified ZSPA FEIR, which is now final, beyond legal challenge, and conclusively presumed to be adequate. To require any more extensive or repetitive review would violate fundamental principles of CEQA that seek to promote the finality of EIRs and avoid and prohibit meaningless, duplicative, wasteful, and/or unnecessary environmental review. ***************************************************
Your anticipated attention to the above information is greatly appreciated, and we hope it is helpful to you. Should you have any questions regarding the foregoing, please do not hesitate to contact the undersigned directly.

Very truly yours,

MILLER STARR REGALIA
Arthur F. Coon
AFC:tzb/klw
cc: Adam Lindgren, Esq., City Attorney, [email protected] Elizabeth Sparkman, Community Development Director,
[email protected]
George Condon, Dermody Properties, [email protected]
Lucy Crocker, Lucy & Company, [email protected]
Michelle Smira, MMS Strategies, [email protected] Nadia L. Costa, Esq., Miller Starr Regalia, [email protected] Travis A. Brooks, Esq., Miller Starr Regalia, [email protected] ITEM 18.1. ATTACHMENT 5

EXHIBIT E
ITEM 18.1. ATTACHMENT 5

555 Capitol Mall, Suite 1200
Sacramento, California 95814
tel (916) 556‐1531
fax (916) 556‐1516
www.meyersnave.com
Edward Grutzmacher
Attorney at Law
[email protected]
A PROFESSIONAL LAW CORPORATION       OAKLAND     LOS ANGELES     SACRAMENTO     SANTA ROSA     SAN DIEGO March 2, 2020
Michael R. Lozeau
Paige Fennie
Lozeau Drury LLP
1939 Harrison Street, Suite 150
Oakland, CA 94612
Re: Project DD9903: GLP Stores, LLC Warehouse on APN 072-2860-033-0000 Request for Review under the California Environmental Quality Act (“CEQA”) Dear Mr. Lozeau and Ms. Fennie:

The City of Rancho Cordova (“City”) is in receipt of your letter dated February 18, 2020 concerning Project DD9903: GLP Stores, LLC Warehouse on APN 072-2860-033-0000 (“Project”). The City Attorney’s Office has had the opportunity to review your letter and has the following responses to the allegations and assertions made therein.

In your letter, you claim that the City is in violation of the California Environmental Quality Act (“CEQA”) for relying on CEQA Guidelines section 15183 to conclude that the Project is in compliance with the City’s General Plan and no further environmental review is required.

Your letter further asserts that the CEQA requires the City to examine the Project’s potential impacts to human health from toxic air contaminants (“TAC”), (pp. 3-4), impacts from the Project’s greenhouse gas emissions, (p. 4-5), the Project’s consistency with the General Plan (p. 5-6), and the Project’s impacts to biological resources, (p. 5-8).

The Project seeks Major Design Review approval for a 164,149 square-foot light industrial office warehouse and associated office space building that includes parking, lighting, and landscaping for the applicant GLP Stores, LLC. The Project is located within the Villages of Zinfandel Special Planning Area (“ZSPA”). The Special Planning Area was approved in 2002 by Sacramento County. The ZSPA includes residential, commercial, business professional, light industrial, park, bike trails, and open space uses. A Final Environmental Impact Report was certified for the Special Planning Area in 1998 by Sacramento County and a Mitigation Monitoring Program was adopted. Under the City’s General Plan and the ZSPA, the Project site has a designation of Light Industrial, which allows for limited industrial uses. Similarly, under the City’s Zoning Code, the Project site is zoned Light Industrial Villages of Zinfandel Special Planning Area (LI ZSPA) which allows for industrial/retail flex and manufacturing and warehousing uses.

ITEM 18.1. ATTACHMENT 6 ATTACHMENT 5

Michael R. Lozeau
March 2, 2020

A PROFESSIONAL LAW CORPORATION          OAKLAND     LOS ANGELES     SACRAMENTO     SANTA ROSA     SAN DIEGO The Project site has had previous entitlements that were approved as follows:

April 2006: Tentative Parcel Map that included the light industrial zoned area to the west and south. Divided 3 parcels into 93 parcels.

May 2007: Tentative Subdivision Map, Creekside Commerce Center, to divide 28 acre parcel into 16 parcels. The project also included a design review for 16 buildings.

Feb 2009: A Tentative Subdivision Map Amendment, Creekside Commerce Center, that reduced the subdivision map from 16 parcels to 8 parcels and reduced 16 buildings to 7 buildings.

March 2017: A Tentative Subdivision Map, Creekside Commerce Center, Extension to February 2020.

Oct 2018: Final Map recorded.

Oct 2019: Lot Line Adjustment to combine 3 lots into 1 lot (subject property).

The Project is a permitted use and does not require a conditional use permit. Rather, the Project requires only approval of Major Design Review. Pursuant to the City’s Code, Chapter 23.141, the City Council “may approve or approve with conditions an application for major design review after finding all of the following” “A. The proposed project is consistent with the objectives of the General Plan, complies with applicable zoning regulations, Specific Plan provisions, and special planning area provisions, and is consistent with the applicable Rancho Cordova design guidelines.

B. The proposed architecture, site design, and landscape are suitable for the purposes of the building and the site and will enhance the character of the neighborhood and community.

C. The architecture, including the character, scale, and quality of the design, relationship with the site and other buildings, building materials, screening of exterior appurtenances, exterior lighting and signing, and similar elements, establishes a clear design concept and is compatible with the character of existing or anticipated buildings on adjoining and nearby properties.

D. The proposed project will not create conflicts with vehicular, bicycle, or pedestrian transportation modes of circulation.” (City Code, § 23.141.070.) The City Council may only condition approval of a Major Design Review application “to ensure specific design features, construction materials, and conformance with all applicable provisions of this chapter.” (City Code, § 23.141.080.) ITEM 18.1. ATTACHMENT 6 ATTACHMENT 5

Michael R. Lozeau
March 2, 2020

A PROFESSIONAL LAW CORPORATION          OAKLAND     LOS ANGELES     SACRAMENTO     SANTA ROSA     SAN DIEGO “A city is not, pursuant to general law, required to have a design review ordinance.

Accordingly, where, as here, a city chooses to impose such an additional level of review, it is for the city to determine the scope that such review will entail.” (Friends of Davis v. City of Davis (2000) 83 Cal.App.4th 1004,1014 (“Friends of Davis”).) “The Guidelines recognize that the application of CEQA to a local ordinance is dependent upon the scope and interpretation of the local ordinance, rather than vice versa. ... The Guidelines note[d] that CEQA does not grant an agency new powers independent of the powers granted by other laws. (Guidelines, § 15040, subd. (a).) Rather, the exercise of an agency’s authority under a particular law must be within the scope of the agency’s authority provided by that law and must be consistent with express or implied limitations provided by other laws.” (Id. at pp. 1014–1015.) Where a city’s own ordinance prevents it from disapproving or conditioning a project “for non-design related matters,” it lacks “discretion to address environmental effects” and, thus, the city’s ability to apply CEQA review to a project is limited to designrelated issues. (McCorkle Eastside Neighborhood Group v. City of St. Helena (2018) 31 Ca.App.5th 80, 91-95.)
Therefore, under CEQA, the City lacks the discretion under the Major Design Review approval process to consider environmental effects not related to the design of the Project, including, but not limited to human health impacts from TAC’s, greenhouse gas emissions, and impacts to biological resources. That said, pursuant to the General Plan and the ZSPA, the Project will be required to comply with the mitigation monitoring and reporting program for the ZSPA, which includes measures designed to mitigate the impacts from air pollutant emissions and impacts to biological resources in the area. Moreover, the Project has undertaken a trip generation analysis that concludes that the Project’s traffic trips are consistent with the analysis and findings of the ZSPA EIR. As such, no further CEQA review of this Project is required.

If you have any further questions regarding this Project, please do not hesitate to contact myself or the City.

Best Regards,
Edward Grutzmacher
cc (email only): Adam Lindgren
Frank Splendorio
Cyrus Abhar
Darcy Goulart
Stacy Leitner
June Cowles
3489253.1
ATTACHMENT 6

DPML-58478\2730442.2
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
January 25, 2023

VIA EMAIL
Mayor Budge, Vice Mayor Sander, and City
Councilmembers
City of Rancho Cordova
2729 Prospect Park Drive
Rancho Cordova, CA 95670
Email: [email protected]
Re: Dermody Properties’ Notice of City of Rancho Cordova’s Breach of and Default Under Development Agreement and 60-Day Period to Cure; 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:

This firm represents Dermody Properties (“Dermody”), as successor-in-interest to original master developer Elliott Homes, Inc. under that certain “Villages of Zinfandel Development Agreement” entered into as of May 28, 2003, and adopted by County Ordinance No. SZC-2003-0011, which became effective June 28, 2003 (the “Development Agreement” or “DA”), with respect to Dermody’s above-referenced real property located within the 671.39± acre site governed by the DA.

This letter constitutes Dermody’s written notice pursuant to Section 6.1 of the Development Agreement that the City of Rancho Cordova (the “City”), which is successor-in-interest to the County of Sacramento under the DA, has materially breached and is in default of its legal obligations under the DA to timely and in good faith process and approve Dermody’s Major Design Review application for the above-referenced LogistiCenter project located on Dermody’s approximately 10- acre parcel at the corner of North Mather Boulevard and Bear Hollow Drive in the City (the “Design Review Project” or “Project”).

The Project is located within the Villages of Zinfandel Special Planning Area (VOZSPA), an 823± acre area within the Cordova community that transitioned from heavy industrial (surface mining) use and zoning to a comprehensively planned and entitled mixed-use development in the late 1990’s and early 2000’s when the County of Sacramento approved extensive development entitlements for the area, including general plan and zoning amendments, an amended community plan, a ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

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public facilities financing plan, and the subject DA. The VOZSPA’s potential environmental impacts were also comprehensively analyzed under the California Environmental Quality Act (“CEQA”; Pub. Resources Code, § 21000 et seq) through a Final Environmental Impact Report (“FEIR”) certified by the County on March 25, 1998, as supplemented through a Final Supplemental EIR (“FSEIR”) certified by the County on April 26, 2000. The DA was approved by Ordinance No. SZC-2003- 0011, which was adopted on May 28, 2003, and has a 20-year term.

Dermody submitted its Design Review Project application on October 25, 2021, and the City determined the application to be complete on January 12, 2022, over a year ago. The City was required to determine within 30 days of that date, or by November 24, 2021, whether an EIR or negative declaration would be required for the Project. (Pub. Resources Code, §§ 21080.1(a), 21080.2.) Even assuming that the Project is not exempt – which it is – such that a CEQA document of some kind would be necessary, all possible statutory deadlines for the City to have completed its CEQA review of the Design Review Project have now expired without the City Council having completed or adopted any CEQA document or findings. (See Pub.

Resources Code, § 21151.5(a), (1)(A), (B); CEQA Guidelines, § 15107 [if negative declaration is to be prepared, lead agency must complete and adopt same within 180 days after date application is complete, and if EIR is to be prepared, agency must complete and certify same within one year].) The City’s staff and attorneys have consistently advised the Council that the Project is exempt from CEQA under CEQA Guidelines, § 15183. (See Pub. Resources Code, § 21083.3.) For many months Dermody and the City’s own planning staff have advised and reminded the Council of (1) its obligations under the DA, (2) its very limited discretion to conduct CEQA review in the Major Design Review process, and (3) that the Project should be reviewed and found exempt from further environmental analysis under the exemption/streamlined review provisions of CEQA Guidelines section 15183, which the City has applied to similar projects. The Council’s failure to timely complete its CEQA review of the Project in the more-than-one-year period of time that has elapsed since the Project application was determined to be complete, in and of itself, constitutes a bad faith failure to timely process and approve the Project as required by the DA.

The City’s failure to timely process the Project not only violates CEQA and the DA, as explained further below, but has deprived Dermody of legal rights that should also rightfully have accrued to it under the Permit Streamlining Act (“PSA”; Gov.

Code, § 65920 et seq). The PSA provides that a CEQA lead agency must act to approve or disapprove a project within 60 days after a negative declaration is adopted or an exemption determination made. (Gov. Code, § 65950(a)(4), (5).) The City should have completed its CEQA analysis and exemption determination for this Project by the Spring of 2022, at the latest, and acted to approve or disapprove it not later than June 2022 – over six months ago – assuming it had been acting in compliance with CEQA and the PSA, and even setting aside its further legal obligations under the DA.

ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

DPML-58478\2730442.2
In fact, the Project should have been processed to an approval decision even earlier than last summer because – in addition to the basic requirements of CEQA and the PSA – Dermody has vested property and contractual rights under the DA requiring the City’s timely processing of and approval action on its Design Review Project application, and the City’s full and good faith cooperation to enable Dermody to obtain the full benefits of the DA. These DA rights of Dermody, and the City’s corresponding DA obligations, have previously – and repeatedly – been explained to the City in detail, with abundant supporting citations to relevant DA provisions, in prior correspondence from Dermody’s counsel including: (1) Nadia Costa’s July 18, 2022 letter to the City Attorney, copied to the City Manager and Deputy City Manager; (2) my September 16, 2022 letter to City Manager Cyrus Abhar, copied to the City Attorney and Community Development Director; (3) my November 29, 2022 letter to the City Council, copied to the City Manager, Deputy City Manager, and City Attorney; (4) my December 14, 2022 letter to the City Council, copied to the City Manager, Deputy City Manager, and City Attorney; and (5) my January 10, 2023 letter to the City Council, copied to the Community Development Director and City Attorney.1
Despite Dermody’s extensive correspondence repeatedly bringing the City’s attention to its legal obligations under the DA and applicable law, the City Council has ignored and failed even to acknowledge these obligations. Instead, it has repeatedly continued and delayed hearings on the Project beginning in April 2022.

After a half year delay, the City refused to set a hearing for Project approval in November 2022 as Dermody requested. After delays of well over a year from the date of Dermody’s submitted application, and almost a year from the application being deemed complete, the City finally set a December 5, 2022 hearing to consider the Project, but then further continued that hearing without taking action to January 17, 2023. On the latter date, the Council finally closed the public hearing following presentations by City staff and Dermody, and after hearing public comment on the Project, but then refused to discuss, deliberate or take action on Dermody’s Project application, and instead further continued that portion of the hearing to January 30, 2023. The Council voted to further delay a decision on Dermody’s Project so that it could first further consult with the City Attorney (who was present at the January 17 hearing) in closed session concerning an 8-page, single-spaced “late hit” CEQA comment letter submitted by an attorney hired by project opponents which was not received until well after commencement of the January 17 hearing.

Unfortunately, but consistent with the Council’s previous public discussions indicating either a profound misunderstanding of or a heedless intent to exceed its lawful discretion in its consideration of the Project, the Council’s most recent action 1 The foregoing correspondence, and all exhibits thereto, are already part of the Administrative Record in the City’s administrative proceedings on Dermody’s Design Review Project and are fully incorporated by reference in the instant written notice of City’s breach and default under the DA.

ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

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was again taken in bad faith disregard of its DA obligations to timely process and approve the Project. As but one example, when I, as counsel for Dermody, was asked by the Council to come to the podium and respond at the January 17 hearing to the just-received CEQA comment letter and began my response by accurately characterizing it as a typical (and meritless) “late hit” CEQA comment letter, I was interrupted and chided by the Council not to “editorialize.” I found this to be an extremely surprising rebuke since the Council, like the California courts, is surely “aware that the practice of allowing [CEQA] objectors to withhold objections, which could have been raised earlier in the environmental review process, until the last possible moment must be strongly disapproved.” (Galante Vineyards v.

Monterey Peninsula Water Management Dist. (1997) 60 Cal.App.4th 1109, 1120, emph. Added, citing Citizens of Goleta Valley v. Board of Supervisors (1990) 52 Cal.3d 553, 568.) As noted by our Supreme Court in the above-cited case:
“We cannot, of course, overemphasize our disapproval of the tactic of withholding objections, which could have been raised earlier in the environmental review process, solely for the purpose of obstruction and delay. As one federal court has aptly stated: “[T]he NEPA requirement of studying alternatives may not be turned into a game to be played by persons who – for whatever reasons and with whatever depth of conviction – are chiefly interested in scuttling a particular project. [citation.]” (Goleta Valley, supra, 52 Cal.3d at 568, emph. added, citation omitted; see also, e.g., South County Citizens for Smart Growth v. County of Nevada (2013) 221 Cal.App.4th 316 [lengthy “late hit” comment letter from project opponent’s attorney delivered at beginning of Board hearing on project resulted in Board continuing hearing for over a month to respond]; cf. Save North Petaluma River and Wetlands v. City of Petaluma (2022) 86 Cal.App.5th 207 [notwithstanding project opponent’s late hit comment letter submitted on afternoon of hearing, City Council proceeded with hearing and after considering detailed staff memo covering project’s history, public comments, the real party’s public outreach, and numerous responsive project revisions, and the revised project’s satisfaction of the previously expressed planning commission concerns, and after several hours of deliberation and public comment at the hearing, City Council took action as publicly noticed and scheduled and voted to certify FEIR and approved zoning amendments for project].) While Dermody will respond by separate letter to the substance – or, more accurately, the lack thereof – of the Project opponents’ lawyer’s late-hit CEQA comment letter, the above is included for present purposes simply to augment Dermody’s showing as to the City’s continuing bad faith breaches and disregard of its DA obligations. Here, the City Council not only refused to “strongly disapprove” the Project opponents’ “late hit” CEQA tactic, but actually rewarded it with a further two-week delay. By contrast, a council acting in good faith would have quickly and roundly condemned and rejected the Project opponents’ well-recognized and judicially-disapproved abusive CEQA “late-hit” tactic, and would have reminded the Project opponents of the lengthy processing process Dermody has endured to date, ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

DPML-58478\2730442.2
the numerous project amendments and concessions it has voluntarily made and offered to address public concerns, and Dermody’s vested legal and contractual rights to timely processing and approval of its Major Design Review application under the DA. But the Council did not. Instead, it chose to praise the project opponents, as “informed and articulate” and not “typical NIMBYs,” further underscoring its willful disregard for Dermody’s DA and other legal rights to timely and good faith processing of and an approval decision on its Project.2 In other words, for whatever reason, the Council members are continuing to unnecessarily delay their decision on this Project and are publicly praising Project opponents who are vilifying Dermody, encouraging further dilatory City action in processing the Project approvals, and blatantly encouraging the City to repudiate its binding DA obligations. Such conduct is the polar opposite of the good faith required under the DA and applicable law.

In sum, the only conclusion that can be drawn from the record in this matter is this:
the City has violated and breached the Development Agreement and Dermody’s vested rights thereunder by attempting to subject Dermody’s Design Review Project to improper and inapplicable requirements and procedures, and by failing to act in good faith to timely process, act on, and approve the Project. Dermody can no longer wait or give the City Council the benefit of the doubt by assuming that it will ultimately choose to comply with its legal obligations under the DA – the term of which will expire in Summer 2023 – and Dermody has therefore been compelled to now provide this formal notice of default.

As provided in the DA, the City can cure its default and avoid the institution of legal proceedings seeking remedies for its DA breaches, by making a final decision on and approving Dermody’s Project, as the Project was fully presented at the January 17, 2023 meeting, by not later than 60 days from the date of this letter. (DA, § 6.1.)
2 It bears noting that the same Project opponents praised by council members offered comments characterizing my client (or, perhaps, me) as a “playground bully” (for insisting that Dermody’s vested rights be respected) and urging the council to “continue the process as long as needed” (Troy Fennel). The opponents even stated: “There are ways out of this contract [the DA], and you know what they are.” (Greg Mylenberg.) Stunningly, the Council did nothing to correct such misapprehensions or acknowledge its binding obligations under the DA.

ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

DPML-58478\2730442.2
Thank you for your anticipated attention to these matters.

Very truly yours,

MILLER STARR REGALIA
Arthur F. Coon
AFC:dly/klw
cc: Micah Runner, City Manager ([email protected]) Elizabeth Sparkman, Community Development Director,
([email protected])
Adam Lindgren, City Attorney ([email protected]) George Condon, Dermody Properties ([email protected]) Lucy Crocker, Lucy & Company ([email protected])
Michelle Smira, MMS Strategies ([email protected]) Nadia L. Costa, Esq., Miller Starr Regalia ([email protected]) Travis A. Brooks, Esq., Miller Starr Regalia ([email protected]) ITEM 18.1. ATTACHMENT 5

DPML-58478\2731268.1
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
January 25, 2023

VIA EMAIL
Mayor Budge, Vice Mayor Sander, and City
Councilmembers
City of Rancho Cordova
2729 Prospect Park Drive
Rancho Cordova, CA 95670
Email: [email protected]
Re: January 17, 2023 Letter to City Council from Attorney Gloria D. Smith Concerning CEQA Review of LogistiCenter Project at N. Mather Blvd./Bear Hollow Drive (APN 072-236—041-000) Within Villages of Zinfandel Special Planning Area, File No. PLND-1021-0015 Dear Mayor Budge, Vice Mayor Sander, and Honorable Members of the City Council:

This office represents Dermody Properties (“Dermody”) in connection with the City Council’s ongoing Major Design Review approval process for the above-referenced warehouse project (the “Project”). This letter addresses contentions raised in the above-referenced January 17, 2023 letter to the Council from San Francisco attorney Gloria D. Smith (the “Smith letter”), which was written on behalf of certain Project opponents calling themselves “Stone Creek Residents for Smart Growth.” The Smith letter makes numerous assertions about the California Environmental Quality Act (“CEQA”; Pub. Resources Code, § 21000 et seq) and its alleged applicability to the City’s design review of the Project. Based thereon, the Smith letter urges this Council to reject the analysis and well-supported conclusions of City’s expert planning staff that: (1) “the [P]roject is exempt and no environmental document pursuant to CEQA is required” and (2) “the City lacks the discretion under the Major Design Review approval process to consider environmental effects not related to the design of the Project, including, but not limited to human health impacts from toxic air contaminants, greenhouse gas emissions, and impacts [to] biological resources.” (Staff Memorandum from Associate Planner Nicholas Sosa to City Council re January 17, 2023 Meeting Agenda Item 18.1, at page 8; see also Staff Memorandum from Sosa to Council re December 5, 2022 Meeting Agenda Item 22.1, at pp. 12-13 [reaching same conclusions].) As explained in more detail below, the City staff’s analysis and determinations are legally and factually correct, and it is the Smith letter that is in error and should be rejected.

ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

DPML-58478\2731268.1
I. CITY’S STAFF HAS CORRECTLY DETERMINED THAT THE DESIGN

REVIEW PROJECT BEFORE THE COUNCIL IS CEQA-EXEMPT UNDER
GUIDELINES SECTION 15183 BECAUSE IT IS STATUTORILY EXEMPT FROM CEQA UNDER THAT GUIDELINE’S AUTHORIZING STATUTE,
PUBLIC RESOURCES CODE SECTION 21083.3
The City’s staff has correctly analyzed the Project’s exemption from CEQA as follows:

The Logisticenter at Rancho Cordova Major Design Review would be exempt from CEQA review under CEQA State
Guidelines Section 15183. This exempts from CEQA projects that are consistent with the development density established by existing zoning, community plan, or general plan policies for which an Environmental Impact Report (EIR) was certified, except as might be necessary to examine whether there are project-specific significant effects which are peculiar to the project or its site. The project is located within the Villages of Zinfandel Special Planning Area (VOZSPA). An EIR was certified by the Sacramento County Board of Supervisors in 1998 for the VOZSPA. Additionally, a Supplemental EIR was prepared and certified by the Sacramento County Board of Supervisors in 2002 for the plan area.

The Logisticenter at Rancho Cordova Major Design Review involves development of a 155,040 square foot industrial shell building with parking and loading docks. The development also includes landscaping, drainage, and required screening/fencing for a loading dock area. The business and professional park (BP) site was identified in the Villages of Zinfandel Special Planning Area EIR and uses contemplated within the BP designation include those use[] listed in the Sacramento County Zoning Code under the BP and MP (Industrial Office Park) use tables located in Chapter 25 and Chapter

30. Warehousing is a permitted by right use[s] as listed in Table IV I.3.

Additional supplemental technical studies were prepared to further support that no additional project related impacts would occur as a result of the proposed project. These technical studies include additional traffic analysis, as well as a noise study. The traffic analysis results were summarized under the Traffic Improvements section of the December 5th staff report. The noise study that was completed concluded that noise levels associated with the project generated onsite operations would satisfy the General Plan noise criteria at the nearest existing residential uses. This is due in part to existing solid noise barriers in the vicinity, as well as overall on-site operational practices.

ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

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As this Major Design Review is consistent with the Special Planning Area and the environmental documentation prepared for the Special Planning Area, it is exempt from CEQA review.

So long as the project does not have any project-specific significant effects peculiar to the Major Design Review and not identified in the previous environmental documentation, the project is exempt and no environmental document pursuant to CEQA is required. The project applicant is requesting approval of a Major Design Review for the proposed project. Additionally, under CEQA, the City lacks the discretion under the Major Design Review approval process to consider environmental effects not related to the design of the Project, including, but not limited to human health impacts from toxic air contaminants, greenhouse gas emissions, and impacts of biological resources.
(1/17/23 Meeting Staff memo at pp. 7-8, emph. added.)
While the Smith letter attacks Dermody’s past correspondence and positions regarding CEQA, mischaracterizing many of them in the course of doing so (Smith letter, at pp. 2-3, 6), it fails to acknowledge that the City’s own planning staff (and City Attorney) have independently concluded – in full agreement with Dermody’s counsel – that the Design Review Project now before the Council for approval is exempt from CEQA. That conclusion is fully supported by the law and the record.

Indeed, and as the Smith letter also fails to recognize, the Design Review Project is clearly statutorily exempt under Public Resources Code section 21083.3, which is part of CEQA itself, and which states in relevant part:
(a) If a parcel has been zoned to accommodate a
particular density of development or has been designated in a community plan to accommodate a particular density of development and an environmental impact report was certified for that zoning or planning action, the application of this division [CEQA] to the approval of any subdivision map or other project that is consistent with the zoning or community plan shall be limited to effects upon the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report.
(b) If a development project is consistent with the general plan of a local agency and an environmental impact report was certified with respect to that general plan, the application of this division [CEQA] to the approval of that development project shall be limited to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

DPML-58478\2731268.1
in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report.
(Pub. Resources Code, § 21083.3(a), (b).) This section of CEQA – which the Smith letter fails to mention – is the relevant statutory authority that CEQA Guidelines § 15183 cites and on which it is based.

A leading CEQA treatise describes the scope and operation of this statutory exemption as follows:

When Pub. Res. C. § 21083.3 applies, CEQA review of a later project is limited to significant environmental impacts that are [1] “peculiar to” the affected parcel or project and [2][a] that were not addressed as significant impacts in the previous EIR or [b] that substantial new information shows will be more significant than described in the previous EIR, [3] together with significant off-site and cumulative impacts that were not discussed in the prior EIR. [citations] Section 21083.3 is worded as a CEQA exemption and not as a procedure for streamlining subsequent environmental review. …. [¶] As originally enacted in 1981, [section] 21083.3 applied only to residential development projects. It was amended in 1992 to remove the residential limitation, so that it now applies to industrial and commercial projects as well as mixed-use projects.
(1 Kostka & Zischke, Practice Under the California Environmental Quality Act (CEB 2d ed., 2022 Update), § 10.33, pp. 10-35 – 10-36, citations omitted, emph. in orig., bracketed text added.)
Accordingly, while there are statutory limits (as enumerated in the above passage) on its application, the Smith letter’s contention that CEQA Guidelines “§ 15183 is not a true exemption” (Smith letter, at p. 3) is simply incorrect. The interpretive Guideline is in relevant part based wholly on the statutory CEQA exemption set forth in Public Resources Code § 21083.3, and as a regulatory interpretive aid it must be applied in a manner consistent with that authorizing statutory exemption in order to be valid. (E.g., 8 Miller & Starr, California Real Estate 4th (2022 Update), § 26:3, pp. 26-18 – 26-19, and cases cited [“guideline that is clearly unauthorized or inconsistent with CEQA is invalid”].) Further, because it is a statutory CEQA exemption enacted by the Legislature for policy reasons, rather than a categorical CEQA exemption based on a regulatory determination of the Secretary of Resources, the exemption is not to be narrowly construed, but, rather, must be broadly construed to achieve its statutory purpose of exempting the covered actions from CEQA review. (E.g., County of Ventura v. City of Moorpark (2018) 24 Cal.App.5th 377, 386-387 [observing it would be incorrect to assume a harmony exists between CEQA’s general purposes and those of its statutory exemptions, which, on the contrary, reflect a variety of policy goals promoting interests deemed important enough to justify foregoing the benefits of CEQA review; ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

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further stating, in upholding application of CEQA’s emergency exemption, that courts “do not balance the policies served by the statutory exemptions against the goal of environmental protection” and “the self-evident purpose of the exemption is to provide an escape from the EIR requirement despite a project’s clear, significant impact”].)
II. THE SMITH LETTER CONCEDES THAT THE STATUTORY EXEMPTION OF PUBLIC RESOURCES CODE § 21083.3/CEQA GUIDELINES § 15183

APPLIES TO THE DESIGN REVIEW PROJECT, AND IS WRONG IN
ARGUING THAT ANY OF THE STATUTE’S LIMITATIONS REMOVE THE PROJECT FROM THE SCOPE OF THE EXEMPTION; ITS ATTEMPT TO INVOKE CEQA’S SUBSEQUENT REVIEW RULES ALSO FAILS
The Smith letter does not contest – and thus concedes – that section 21083.3 applies to the project since (1) the parcel on which it is proposed has been zoned and planned to accommodate a particular density of development, (2) an EIR was certified for that zoning and planning action, and (3) the Project is consistent with the zoning and plan for the area.

The Smith letter nonetheless argues the Project is removed from the coverage of the statutory exemption because there are allegedly impacts “peculiar to the project” that “were not analyzed as significant effects in [the] prior EIR on the zoning action” or “which substantial new information [not known at the time the EIR was certified] shows will be more significant [or severe] than described in the prior [EIR].” (See Pub. Resources Code, § 21083.3(a); Smith letter at p. 3, citing CEQA Guidelines, § 15183.) The Smith letter also appears to argue that the Project will have potentially significant cumulative impacts that were not discussed in the prior EIR. (Smith letter, at pp. 3-5; Pub. Resources Code, § 21083.3(c).) The Smith letter’s first argument fails as a factual matter because there is absolutely no evidence that it points to showing that any of the allegedly significant and unanalyzed environmental impacts with which it professes concern are “peculiar to the parcel or to the project” as required by the statute to limit the scope of the exemption. (Pub. Resources Code, § 21083.3(a), (b).) Even assuming arguendo that the warehouse project would have significant GHG, particulate matter, ozone, NOx, or other air quality impacts as the Smith letter suggests (at p. 4), these impacts are not peculiar to Dermody’s Project or parcel. Indeed, they are the same as or similar to the air quality impacts of any other warehouse or distribution center built on any other parcel authorized by applicable zoning for such use; they are not impacts caused by any “peculiar” aspect of either the parcel or the Project, but are generic to the authorized use itself. To the extent the Smith letter tries to argue that the statutory limit on the exemption does not require that the alleged significant impacts be “peculiar” to the parcel or project, it simply misreads the statute.

To the extent the Smith letter argues that CEQA contains some uncodified requirement to “keep information fresh” by updating allegedly “stale” EIRs whenever “new information” becomes available (Smith letter, pp. 3-4, citing CEQA Guidelines, ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

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§ 15162[(a)] (3)), it is wrong as a matter of law and either fundamentally misunderstands – or intentionally mischaracterizes – the CEQA subsequent review rules it tries to invoke. (See also Pub. Resources Code, § 21083.1 [“It is the intent of the Legislature that courts … shall not interpret this division [CEQA] or the state guidelines … in a manner which imposes procedural or substantive requirements beyond those explicitly stated in this division or in the state guidelines.”].) In either event, its arguments lack merit. CEQA’s “subsequent review” rules (Pub.

Resources Code, § 21166; CEQA Guidelines, §§ 15162, 15163) are designed to balance promoting environmental review with finality and efficiency interests, and they therefore limit a lead agency’s authority to require additional CEQA review after an EIR has been certified. (See, Friends of College of San Mateo Gardens v. San Mateo Community College Dist. (2016) 1 Cal.5th 937, 949.) To avoid an “intractable” agency decision-making process (ibid.), CEQA establishes a strong presumption against further environmental review after an EIR is certified. (Committee for Reevaluation of the T-Line Loop v. San Francisco Municipal Transportation Agency (2016) 6 Cal.App.5th 1237, 1246; Save Our Heritage Organization v. City of San Diego (2018) 28 Cal.App.5th 656, 666; Citizens Against Airport Pollution v. City of San Jose (2014) 227 Cal.App.4th 788, 805.) Thus, under the subsequent review CEQA rules the Smith letter tries to invoke, once an EIR for a project has been prepared, the agency may not require a subsequent or supplemental EIR except in specific circumstances. An SEIR is required only if “[s]ubstantial changes are proposed in the project” or “occur with respect to the circumstances” of the project or if “[n]ew information” becomes available which “will require major revisions of the [EIR]” “due to the involvement of new significant environmental effects or substantial increase in the severity of previously identified significant effects.” (Pub. Resources Code, § 21166; CEQA Guidelines, §§ 15162(a), 15163(a); T-Line Loop, supra, 6 Cal.App.5th at 1246.) Moreover, “new information” is that “which was not known and could not have been known” when the EIR was originally “certified as complete” (§ 21166(c)), and it must be “of substantial importance,” for example because it shows “[s]ignficant effects … will be substantially more severe than shown in the previous EIR.” (CEQA Guidelines, § 15162(a)(3).)
The Smith letter falls woefully short of pointing to any substantial evidence showing that a subsequent or supplemental EIR could be required for the Project under these standards. The Project does not modify, but is concededly fully consistent with, the general plan and zoning standards reviewed under the 1998 FEIR and 2000 FSEIR for the VOZSPA entitlements.

Moreover, there are no “changed circumstances” and no “significant new information” that was not known or knowable at the time those EIRs were certified.

It was always known and, indeed, planned that commercial and light industrial uses (such as warehouses and distribution centers) could be developed in locations within the VOZSPA that included the Project parcel, and that such locations were near to other VOZSPA locations where residences would be built. To the extent the Smith letter claims that air quality issues, including those related to GHGs or toxic ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

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diesel particulate matter (whether PM10 or PM2.5) constitute “new information” that was unknown or unknowable in 1998 or 2000 (see Smith letter at pp. 4-5), it is wrong as a matter of both fact and law, for reasons pointed out in prior correspondence. (See 1/10/23 Coon to Council letter, at p. 7, and legal authorities cited therein.) To the extent the Smith letter (at pp. 4-5) argues that post-EIR changes in laws, or regulatory standards for categorizing, analyzing or assessing the significance of project impacts constitute “significant new information” or “changed circumstances” requiring subsequent CEQA review, it is again wrong as a matter of law. (Citizens Against Airport Pollution, supra, 227 Cal.App.4th at 807- 808; Concerned Dublin Citizens v. City of Dublin (2013) 214 Cal.App.4th 1301, 1318-1320.) Further, information anticipated by an EIR is not significant new information. (E.g., Citizens Committee to Complete the Refuge v. City of Newark (2021) 74 Cal.App.5th 460, 478 [“REIR anticipated the new information that appellants rely on”]; T-Line Loop, supra, 6 Cal.App.5th at 918 [“FEIR anticipated an increase in residential use and other development and analyzed the impacts of constructing and operating light rail in residential areas….”].) Similarly, and contrary to the Smith letter’s contentions, there is no CEQA statute or rule declaring a project EIR “stale” after any particular time period; as seen above, whether CEQA’s subsequent review rules require a supplemental EIR depends on whether substantial changes in the project or surrounding circumstances or significant new information require major revisions to a previously certified EIR (or other adopted CEQA document) due to the involvement of new or substantially more severe environmental impacts – not the mere passage of time or any vague or subjective notions of “freshness.” (E.g., T-Line Loop, supra, 6 Cal.App.5th at 1254 [holding use of 16-year old EIR was adequate CEQA compliance for light rail line project and noting absence of “any authority holding that mere delay in completing construction constitutes a substantial change in a project under section 21166”]; Snarled Traffic Obstructs Progress v. City and County of San Francisco (1999) 74 Cal.App.4th 793 [9-year old negative declaration was adequate CEQA compliance for revived parking structure project and SEIR not required].) The very fact that the County entered into a CEQA-reviewed 2003 Development Agreement with a 20-year term evinces that it had thoroughly analyzed the environmental impacts of long-term development and build-out of the VOZSPA.

In short, the Smith letter fails to negate the application of CEQA’s Section 21083.3 statutory exemption because it points to no facts or evidence of any environmental impacts that are peculiar to the Project or site and that were not analyzed as significant impacts in the prior VOZSPA EIR or shown by substantial new information to be more significant than previously described. Nor does the Smith letter point to any substantial evidence supporting any of the grounds for conducting further review under CEQA’s subsequent review rules. Nor does the Smith letter demonstrate or point to evidence of any significant cumulative impacts (as to air quality or otherwise) that were not discussed as such in the prior EIR.

ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

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III. AS A SEPARATE AND INDEPENDENT GROUND FOR REJECTING ITS

CEQA ARGUMENTS, CITY STAFF HAS CORRECTLY INTERPRETED
CITY’S MAJOR DESIGN REVIEW PROCESS AS LIMITING CITY’S

DISCRETION SUCH THAT IT CANNOT ADDRESS THE AIR QUALITY

IMPACTS OF WHICH THE SMITH LETTER COMPLAINS
It is fundamental that when addressing a project’s significant effects, an agency may only exercise those express or implied powers provided by law other than CEQA, subject to the other law’s express or implied limitations. (Pub.

Resources Code, § 21004; CEQA Guidelines, § 15040(b) [“CEQA does not grant an agency new powers independent of the powers granted to the agency by other laws.”].) The City’s Major Design Review ordinance is the “other law” that provides the express or implied powers the Council may exercise in acting on the Project design review application that is now before it. The City Council is bound by and must comply with its own Design Review Ordinance, including that local law’s restrictions on its discretion. As the Court of Appeal recently explained in the context of applying CEQA to a housing project, “where a legal obligation limits an agency’s discretion, the scope of environmental review likewise is limited” and “adjusts in relation to the amount of discretion[.]” (Tiburon Open Space Committee v. County of Marin (2022) 78 Cal.App.5th 700.)
While the Smith letter spends two pages desperately attempting to distinguish relevant case law based on insignificant, irrelevant and immaterial alleged factual differences (at pp. 6-7), it fails to grapple with the main and dispositive issue, which is that the City here has consistently interpreted its own design review ordinance not to permit it to address the types of environmental issues the letter raises. (See e.g., City Staff memos for 1/17/23 meeting and 12/5/22 meeting; see also 3/2/20 letter from Meyers Nave attorney Ed Grutzmacher written on behalf of the City to Michael Lozeau, attached hereto as Exhibit 1 [explaining in detail why design review of zoning-compliant warehouse project in VOZSPA limits City’s discretion such that it cannot “consider environmental effects not related to the design of the Project, including, but not limited to human health impacts from TAC’s, greenhouse gas emissions, and impacts to biological resources.”].) Mr. Grutzmacher, a quite knowledgeable CEQA attorney who is a partner at a well-respected law firm, cited in support of the City’s position on this issue the very same cases that Dermody did, and which the Smith letter unpersuasively tries to distinguish – Friends of Davis v. City of Davis (2000) 83 Cal.App.4th 1004, 1014-1015 and McCorkle Eastside Neighborhood Group v. City of St. Helena (2018) 31 Cal.App.5th 80, 91-95.

The point is that CEQA does not independently confer power or discretion, and simply does not apply where agency discretion to deny or require project modifications to mitigate environmental impacts does not exist. The Smith letter fails to cite any provision of the City’s Major Design Review ordinance that would allow the City to exercise CEQA-triggering discretion to address the non-designrelated environmental issues the letter raises.

ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

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IV. CONCLUSION
The City’s design review ordinance does not vest it with CEQA-triggering discretion to address the non-design-related air quality/public health issues the Smith letter raises. The Project before the City is also CEQA-exempt under Public Resources Code § 21083.3 and CEQA Guidelines § 15183. Further, CEQA’s subsequent review rules furnish no authority to revisit or supplement the prior certified EIRs for the VOZSPA, with which the Project is fully consistent. The City should therefore reject the Smith letter’s meritless arguments regarding CEQA, and follow its staff’s correct analysis and recommendations, and its own prior consistent interpretations.

Thank you for your attention to the foregoing important issues.

Very truly yours,

MILLER STARR REGALIA
Arthur F. Coon
AFC:dly/klw
encl.
cc: Micah Runner, City Manager ([email protected]) Elizabeth Sparkman, Community Development Director,
([email protected])
Adam Lindgren, City Attorney ([email protected]) George Condon, Dermody Properties ([email protected]) Lucy Crocker, Lucy & Company ([email protected])
Michelle Smira, MMS Strategies ([email protected]) Nadia L. Costa, Esq., Miller Starr Regalia ([email protected]) Travis A. Brooks, Esq., Miller Starr Regalia ([email protected]) ITEM 18.1. ATTACHMENT 5

EXHIBIT 1
ITEM 18.1. ATTACHMENT 5

555 Capitol Mall, Suite 1200
Sacramento, California 95814
tel (916) 556‐1531
fax (916) 556‐1516
www.meyersnave.com
Edward Grutzmacher
Attorney at Law
[email protected]
A PROFESSIONAL LAW CORPORATION       OAKLAND     LOS ANGELES     SACRAMENTO     SANTA ROSA     SAN DIEGO March 2, 2020
Michael R. Lozeau
Paige Fennie
Lozeau Drury LLP
1939 Harrison Street, Suite 150
Oakland, CA 94612
Re: Project DD9903: GLP Stores, LLC Warehouse on APN 072-2860-033-0000 Request for Review under the California Environmental Quality Act (“CEQA”) Dear Mr. Lozeau and Ms. Fennie:

The City of Rancho Cordova (“City”) is in receipt of your letter dated February 18, 2020 concerning Project DD9903: GLP Stores, LLC Warehouse on APN 072-2860-033-0000 (“Project”). The City Attorney’s Office has had the opportunity to review your letter and has the following responses to the allegations and assertions made therein.

In your letter, you claim that the City is in violation of the California Environmental Quality Act (“CEQA”) for relying on CEQA Guidelines section 15183 to conclude that the Project is in compliance with the City’s General Plan and no further environmental review is required.

Your letter further asserts that the CEQA requires the City to examine the Project’s potential impacts to human health from toxic air contaminants (“TAC”), (pp. 3-4), impacts from the Project’s greenhouse gas emissions, (p. 4-5), the Project’s consistency with the General Plan (p. 5-6), and the Project’s impacts to biological resources, (p. 5-8).

The Project seeks Major Design Review approval for a 164,149 square-foot light industrial office warehouse and associated office space building that includes parking, lighting, and landscaping for the applicant GLP Stores, LLC. The Project is located within the Villages of Zinfandel Special Planning Area (“ZSPA”). The Special Planning Area was approved in 2002 by Sacramento County. The ZSPA includes residential, commercial, business professional, light industrial, park, bike trails, and open space uses. A Final Environmental Impact Report was certified for the Special Planning Area in 1998 by Sacramento County and a Mitigation Monitoring Program was adopted. Under the City’s General Plan and the ZSPA, the Project site has a designation of Light Industrial, which allows for limited industrial uses. Similarly, under the City’s Zoning Code, the Project site is zoned Light Industrial Villages of Zinfandel Special Planning Area (LI ZSPA) which allows for industrial/retail flex and manufacturing and warehousing uses.

ITEM 18.1. ATTACHMENT 6 ATTACHMENT 5

Michael R. Lozeau
March 2, 2020

A PROFESSIONAL LAW CORPORATION          OAKLAND     LOS ANGELES     SACRAMENTO     SANTA ROSA     SAN DIEGO The Project site has had previous entitlements that were approved as follows:

April 2006: Tentative Parcel Map that included the light industrial zoned area to the west and south. Divided 3 parcels into 93 parcels.

May 2007: Tentative Subdivision Map, Creekside Commerce Center, to divide 28 acre parcel into 16 parcels. The project also included a design review for 16 buildings.

Feb 2009: A Tentative Subdivision Map Amendment, Creekside Commerce Center, that reduced the subdivision map from 16 parcels to 8 parcels and reduced 16 buildings to 7 buildings.

March 2017: A Tentative Subdivision Map, Creekside Commerce Center, Extension to February 2020.

Oct 2018: Final Map recorded.

Oct 2019: Lot Line Adjustment to combine 3 lots into 1 lot (subject property).

The Project is a permitted use and does not require a conditional use permit. Rather, the Project requires only approval of Major Design Review. Pursuant to the City’s Code, Chapter 23.141, the City Council “may approve or approve with conditions an application for major design review after finding all of the following” “A. The proposed project is consistent with the objectives of the General Plan, complies with applicable zoning regulations, Specific Plan provisions, and special planning area provisions, and is consistent with the applicable Rancho Cordova design guidelines.

B. The proposed architecture, site design, and landscape are suitable for the purposes of the building and the site and will enhance the character of the neighborhood and community.

C. The architecture, including the character, scale, and quality of the design, relationship with the site and other buildings, building materials, screening of exterior appurtenances, exterior lighting and signing, and similar elements, establishes a clear design concept and is compatible with the character of existing or anticipated buildings on adjoining and nearby properties.

D. The proposed project will not create conflicts with vehicular, bicycle, or pedestrian transportation modes of circulation.” (City Code, § 23.141.070.) The City Council may only condition approval of a Major Design Review application “to ensure specific design features, construction materials, and conformance with all applicable provisions of this chapter.” (City Code, § 23.141.080.) ITEM 18.1. ATTACHMENT 6 ATTACHMENT 5

Michael R. Lozeau
March 2, 2020

A PROFESSIONAL LAW CORPORATION          OAKLAND     LOS ANGELES     SACRAMENTO     SANTA ROSA     SAN DIEGO “A city is not, pursuant to general law, required to have a design review ordinance.

Accordingly, where, as here, a city chooses to impose such an additional level of review, it is for the city to determine the scope that such review will entail.” (Friends of Davis v. City of Davis (2000) 83 Cal.App.4th 1004,1014 (“Friends of Davis”).) “The Guidelines recognize that the application of CEQA to a local ordinance is dependent upon the scope and interpretation of the local ordinance, rather than vice versa. ... The Guidelines note[d] that CEQA does not grant an agency new powers independent of the powers granted by other laws. (Guidelines, § 15040, subd. (a).) Rather, the exercise of an agency’s authority under a particular law must be within the scope of the agency’s authority provided by that law and must be consistent with express or implied limitations provided by other laws.” (Id. at pp. 1014–1015.) Where a city’s own ordinance prevents it from disapproving or conditioning a project “for non-design related matters,” it lacks “discretion to address environmental effects” and, thus, the city’s ability to apply CEQA review to a project is limited to designrelated issues. (McCorkle Eastside Neighborhood Group v. City of St. Helena (2018) 31 Ca.App.5th 80, 91-95.)
Therefore, under CEQA, the City lacks the discretion under the Major Design Review approval process to consider environmental effects not related to the design of the Project, including, but not limited to human health impacts from TAC’s, greenhouse gas emissions, and impacts to biological resources. That said, pursuant to the General Plan and the ZSPA, the Project will be required to comply with the mitigation monitoring and reporting program for the ZSPA, which includes measures designed to mitigate the impacts from air pollutant emissions and impacts to biological resources in the area. Moreover, the Project has undertaken a trip generation analysis that concludes that the Project’s traffic trips are consistent with the analysis and findings of the ZSPA EIR. As such, no further CEQA review of this Project is required.

If you have any further questions regarding this Project, please do not hesitate to contact myself or the City.

Best Regards,
Edward Grutzmacher
cc (email only): Adam Lindgren
Frank Splendorio
Cyrus Abhar
Darcy Goulart
Stacy Leitner
June Cowles
3489253.1
ATTACHMENT 6

ITEM 18.1. ATTACHMENT 5

ITEM 18.1. ATTACHMENT 5

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. PLND1021-0015.

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

We submit this letter on behalf of Dermody Properties (“Dermody”), the successorin-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 18.1. ATTACHMENT 5

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

DPML-58478\2741817.1
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 18.1. ATTACHMENT 5

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

DPML-58478\2741817.1
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 18.1. ATTACHMENT 5

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

DPML-58478\2741817.1

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 18.1. ATTACHMENT 5

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

DPML-58478\2741817.1
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 developerexecuted 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 18.1. ATTACHMENT 5

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

DPML-58478\2741817.1
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 preincorporation/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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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 preincorporation 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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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-andone-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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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ITEM 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
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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") personally appeared HARRY C. ELLIOTT, III
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
Title or Type of Document: DEVELOPMENT AGREEMENT 95–CZB–DGB–Z0B–SDB–TSM-0533 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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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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bzPrEILBER 15. 2003
W
G.c.WALLACE OF CALIFORNIA INC.
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ENTIMATA-WrintelX?",
ITEM 18.1. ATTACHMENT 5

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

Zitgleii:ii/PUlusanOsin*,
ITEM 18.1. ATTACHMENT 5

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(2) 280 0.11. TO VNIACICI OF ZINFANDEL (PAT NO. 34
260 WI. 0. ra.vas OF :WANDS- UNIT NO. 11,
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- r.a 16. MCC. GC THE cook' ammo. cam
Map of Villages of Zinfandel Unit No. 8
(Alexander Collection Subdivision)
NOTES
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ITEM 18.1. ATTACHMENT 5

EXHIBIT C
ITEM 18.1. ATTACHMENT 5

Description: Sacramento,CA Document - Book.Page 20160308.1060 Page: 1 of 10 Order: 1046797 Comment:

ITEM 18.1. ATTACHMENT 5

Description: Sacramento,CA Document - Book.Page 20160308.1060 Page: 2 of 10 Order: 1046797 Comment:

ITEM 18.1. ATTACHMENT 5

Description: Sacramento,CA Document - Book.Page 20160308.1060 Page: 3 of 10 Order: 1046797 Comment:

ITEM 18.1. ATTACHMENT 5

Description: Sacramento,CA Document - Book.Page 20160308.1060 Page: 4 of 10 Order: 1046797 Comment:

ITEM 18.1. ATTACHMENT 5

Description: Sacramento,CA Document - Book.Page 20160308.1060 Page: 5 of 10 Order: 1046797 Comment:

ITEM 18.1. ATTACHMENT 5

Description: Sacramento,CA Document - Book.Page 20160308.1060 Page: 6 of 10 Order: 1046797 Comment:

ITEM 18.1. ATTACHMENT 5

Description: Sacramento,CA Document - Book.Page 20160308.1060 Page: 7 of 10 Order: 1046797 Comment:

ITEM 18.1. ATTACHMENT 5

Description: Sacramento,CA Document - Book.Page 20160308.1060 Page: 8 of 10 Order: 1046797 Comment:

ITEM 18.1. ATTACHMENT 5

Description: Sacramento,CA Document - Book.Page 20160308.1060 Page: 9 of 10 Order: 1046797 Comment:

ITEM 18.1. ATTACHMENT 5

Description: Sacramento,CA Document - Book.Page 20160308.1060 Page: 10 of 10 Order: 1046797 Comment:

ITEM 18.1. ATTACHMENT 5

EXHIBIT D
ITEM 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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

Harry C. Elliott III
President
4 ITEM 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

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 18.1. ATTACHMENT 5

DRAFT EXHIBIT 3A

EXHIBIT 'B'

LAND USE EXHIBIT
7 ITEM 18.1. ATTACHMENT 5

Existing Zoning: RC Existing Zoning: 0
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BP :ing Zon ing t is Ex
EXHIBIT 3A
Rezone for
Veranda at Stone Creek
Ranch Cordova, CA
AUGUST, 2015 Page 1 of 1 Scale: 1"450'
Existing Zoning \ Proposed Zoning \

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ITEM 18.1. ATTACHMENT 5

DPML-58478\2734888.1
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 6, 2023

VIA EMAIL
Mayor Budge, Vice Mayor Sander,
and City Councilmembers
City of Rancho Cordova
2729 Prospect Park Drive
Rancho Cordova, CA 95670
Email: [email protected]
Re: January 27, 2023, Second Letter to City Council from Attorney Gloria D.

Smith Concerning CEQA Review of and Land Use Compliance for LogistiCenter Project at Corner of N. Mather Blvd./Bear Hollow Drive (APN 072-2360-041-000), File No. PLND-1021-0015
Dear Honorable Mayor Budge, Honorable Vice Mayor Sander, City Councilmembers:

We submit this letter on behalf of Dermody Properties (“Dermody”) in response to the above-referenced letter to the Council from attorney Gloria D. Smith (the “second Smith letter”), regarding the LogistiCenter Project (“Project”). We will be submitting another letter prior to the Council’s final hearing on the Project that will respond in greater detail to each contention raised in the second Smith letter, but for now, as a preliminary matter, we will briefly point out its fundamental flaws in the text that follows.

In brief summary, the second Smith letter urges the City to violate state law and its obligations under the May 28, 2003 “Villages of Zinfandel Development Agreement” (the “Development Agreement”) based on a clear mischaracterization of state law and a misunderstanding of – or failure to acknowledge – the relevant underlying facts. Indeed, the letter goes so far as to urge the City to deny the very existence of the Development Agreement – a position that, if adopted by the City, would constitute the bad faith denial of the existence of a binding contract, which is the epitome of a breach of the covenant of good faith and fair dealing. Contrary to the second Smith letter’s unsupported assertions, the Development Agreement remains fully in effect and binding on the City until June of 2023. As we have repeatedly advised, if the City ignores its obligations under the Agreement, it will expose itself to significant monetary damages and attorneys’ fees as expressly provided for in the Agreement. The second Smith letter also raises meritless claims regarding alleged (but non-existent) obligations of the City to apply its current general plan and/or to ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander,
and City Councilmembers
City of Rancho Cordova
February 6, 2023

DPML-58478\2734888.1
update its general plan whenever the state adopts new laws or regulations, and also re-states Smith’s previous arguments that the Supplemental EIR for the Zinfandel Special Plan Area (“ZSPA”) is somehow “stale.” Ultimately, the second Smith letter is yet another eleventh-hour attempt to further obstruct and delay the Project, but it lacks any merit whatsoever and fails to state any valid basis for the City to further delay its final decision and approval of the Project as presented to the Council on January 17, 2023.

I. The Development Agreement Continues in Effect Until June 28, 2023.

Contrary to the claims in the second Smith letter, the Development Agreement was not somehow automatically invalidated when the City incorporated in 2003. State law quite clearly provides that, once recorded, the benefits and burdens of a development agreement accrue to and are binding on all successors in interest to the original parties. As a successor in interest to the County, the City is bound by the obligations in the Agreement that we have previously discussed in detail until June of 2023.

Government Code section 65865.3, invoked by the second Smith letter, places time limits on the term of a 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 automatically becomes null and void if a subject property becomes incorporated or is annexed into a city. Instead, a careful reading of the statute’s plain language, in the context of the Development Agreement statute as a whole, makes clear that when the Legislature enacted Section 65865.3 in 1986, it presumed that development agreements between a county and a developer would continue in effect after a subject property was incorporated or annexed into a city – in other words, Section 65865.3 does not (as the second Smith letter appears to argue) provide the exclusive basis by which a development agreement between a developer and county binds a successor city. As noted in my November 29, 2022 letter to the Council, the election on the incorporation of the City occurred prior to May 28, 2003, when the County (the City’s predecessor in interest) and Elliot Homes (Dermody’s predecessor in interest) executed the Development Agreement.

This means that the Development Agreement does not meet the condition set forth in subdivision (c) of Section 65865.3, that the county “enter[ ] into the agreement with the applicant prior to the date of the election on the question of incorporation or annexation…” As a result, Section 65865.3 and the limitations on a development agreement’s duration set forth in its subpart (a) do not apply by the statute’s own terms. Nothing in Section 65865.3 says that the Development Agreement became void when the City incorporated, and other provisions of the Development Agreement statute make clear that after its recordation it continued in existence as a valid agreement binding upon the City as a successor in interest.

ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander,
and City Councilmembers
City of Rancho Cordova
February 6, 2023

DPML-58478\2734888.1
Numerous actions taken by the City, the County, and other public agencies with jurisdiction over the ZSPA also confirm and demonstrate a clear recognition that the Development Agreement remained fully in effect and legally binding on the City following the City’s incorporation. For example, in 2002 when the Sacramento Local Agency Formation Commission (“LAFCO”) approved the resolution authorizing the City to proceed with the incorporation, it adopted a condition expressly requiring the City to honor development agreements entered into between the County and development project applicants prior to the effective date of the City’s incorporation.

Nothing in LAFCO resolution – which was never challenged and is now beyond legal challenge – allowed the City to invalidate or refuse to recognize or honor development agreements that did not meet the requirements of subdivision (c) of Section 65865.3.

Further, since 2003, the City itself has repeatedly recognized that the Development Agreement has continued and still continues in effect as a binding agreement; more specifically, the City so acknowledged when it negotiated, and the City Council approved, three separate amendments to the Agreement. Each of these amendments conferred benefits and burdens on the City and each acknowledged that, except as amended, the terms and conditions of the Development Agreement remained in full force and effect. The first amendment, dated August 2, 2004, shortened the term of the Development Agreement to 15 years, adjusted the general plan land use and zoning designations for a residential subdivision in the ZSPA, and established a special police tax and park renovation fee for some development within the ZSPA. The most recent amendment, executed in August of 2016, changed the land use and zoning designations for another residential subdivision and re-extended the term of the Agreement to 20 years from its original effective date – to June of 2023. The August 2016 amendment was approved by the Council and duly recorded by the County Clerk, and was never objected to or judicially challenged by anyone. The statute of limitations to challenge the 2016 amendment and its re-extension of the Agreement to June of 2023 has, of course, obviously long since expired and that amendment is now (like the LAFCO incorporation resolution) well beyond any legal challenge and therefore conclusively presumed to be valid. Project opponents thus have no basis to challenge that amendment or its re-extension of the Development Agreement term at this late date.

In summary, the Development Agreement remains in full force and effect. In contending otherwise, the second Smith letter – like the first – fails to properly analyze the applicable law and fails to account for the material facts discussed above, apparently based on sheer willful ignorance stemming from a failure to investigate the facts or the public record that would readily disclose such facts. But, as recent precedent in the CEQA context has amply underscored, a failure to investigate the facts, coupled with a misreading of the clear law, does not excuse the assertion of untenable legal positions completely lacking in probable cause. If the City were to deny the existence of or otherwise ignore its obligations under the Agreement, as the second Smith letter recklessly proposes, it would (as we have already repeatedly advised) be exposing itself to litigation with the risk of incurring ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander,
and City Councilmembers
City of Rancho Cordova
February 6, 2023

DPML-58478\2734888.1
significant monetary damages and attorneys’ fees as expressly provided for in the Development Agreement.

II. The Remaining Claims in the Second Smith Letter Lack Merit.

In addition to the above, the second Smith letter argues that the “City’s general plan does not adequately address current state laws and standards” and repeats the argument that the EIR for the ZSPA is “unlawfully stale.” Both arguments lack any legal support.

Regarding alleged deficiencies with City’s General Plan, we note that the second Smith letter’s arguments in that regard fail, first and foremost, because their arguments against the Development Agreement’s validity lack any merit; because the Development Agreement remains in effect, the Project is only subject to those applicable development standards in the County’s General Plan, ZSPA, and incorporated zoning standards in effect in 2003. Putting that aside, courts have also repeatedly held that cities are not required to update their general plans at any given interval or in connection with any given event. State law certainly does not require a city to 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. Further, if project opponents wish to challenge the City’s General Plan as inadequate, the proper time to have done so or to do so was at the time the General Plan language in question was adopted or when such language was or is amended in the future, and any challenges not timely brought after such trigger dates are time-barred by the applicable statute of limitations.

Finally, 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, the claim that CEQA contains some uncodified requirement that an allegedly stale EIR be updated when new information becomes available is wrong as a matter of law and fundamentally misunderstands CEQA’s subsequent review rules. As previously demonstrated, CEQA establishes a strong presumption against further environmental review after an EIR is certified, and no such further environmental review is warranted here.

III. Conclusion
Similar to the first Smith letter, the City should reject the second Smith letter’s meritless arguments regarding the Development Agreement, which – quite clearly under the relevant law and material facts – remains fully binding on the City. The second Smith letter’s additional arguments fail as well. The City must abide by its obligations under the Development Agreement and make a final decision on and ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander,
and City Councilmembers
City of Rancho Cordova
February 6, 2023

DPML-58478\2734888.1
approving the Project as it was presented at the Council’s January 17, 2023 meeting.

Very truly yours,

MILLER STARR REGALIA
Arthur F. Coon
AFC:tzb/klw
cc: Micah Runner, City Manager ([email protected]) Elizabeth Sparkman, Community Development Director,
([email protected])
Adam Lindgren, City Attorney ([email protected]) George Condon, Dermody Properties ([email protected]) Lucy Crocker, Lucy & Company ([email protected])
Michelle Smira, MMS Strategies ([email protected]) Nadia L. Costa, Esq., Miller Starr Regalia ([email protected]) Travis A. Brooks, Esq., Miller Starr Regalia ([email protected]) ITEM 18.1. ATTACHMENT 5

DPML-58478\2758352.4
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
March 27, 2023
VIA PERSONAL DELIVERY, U.S. MAIL, AND E-MAIL
Stacy Leitner, City Clerk
City of Rancho Cordova
2729 Prospect Park Drive
Rancho Cordova, CA 95670
E-Mail: [email protected]
Re: Government Claim and Notice Re Claim For Money and Damages Against City of Rancho Cordova; LogistiCenter Project at Corner of N.

Mather Blvd./Bear Hollow Drive (APN: 072-2360-041-000); File No.:

PLND 1021-0015 (Bear Hollow Project)
Dear Ms. Leitner:

This office represents Dermody Properties and its affiliates in connection with the above-referenced government claim and project. This letter constitutes a written claim presented pursuant to the Government Claims Act, codified at Government Code section 810 et seq., to apprise the City of Rancho Cordova (“City") of claims for money and damages that Dermody Properties has against the City arising from the City’s failure to timely and in good faith process and approve Dermody’s Major Design Review application for an approximately 155,077-square foot logistics center located northwest of the intersection of North Mather Boulevard and Bear Hollow Drive, known as the “LogistiCenter” or “Bear Hollow” project (“Bear Hollow Project”), and the City’s concomitant actual and anticipatory repudiations and breaches of, and default under, The Villages of Zinfandel Development Agreement (“DA”). As required by Government Code section 910, Dermody provides the following information:

Claimant And Claimant Address: The claimant is DPML Bear Hollow, LLC and Dermody Properties (collectively, “Dermody” or “Claimant”). The post office address of Claimant is c/o George Condon, Dermody Properties, 5500 Equity Avenue, Reno, NV 89502.

ITEM 18.1. ATTACHMENT 5

Stacy Leitner, City Clerk
March 27, 2023

DPML-58478\2758352.4
Address To Which Notices Are To Be Sent: The person submitting this claim on Claimant’s behalf is its undersigned attorney, Arthur F. Coon, and the physical and email addresses to which notices are to be sent are as set forth below:

Arthur F. Coon
Miller Starr Regalia
1331 N. California Boulevard, Suite 600
Walnut Creek, CA 94596
Email: [email protected]
Telephone: (925) 935-9400
Facsimile: (925) 933-4126
Date, Place And Circumstances Giving Rise To Claim: This claim arises from the City’s actions, taken in violation of its legal obligations and duties under the DA, with respect to its handling and treatment of Claimant’s Major Design Review application for the Bear Hollow Project. These actions occurred beginning approximately around the January 12, 2022 date when Dermody’s subject Bear Hollow application was deemed complete by the City, continued through March 6, 2023, when the City, through its City Council, repudiated the DA and Dermody’s vested rights thereunder, and are continuing through the present time. The City’s actions took place within the City of Rancho Cordova, both within and outside public meetings. Such actions, which as noted are continuing, have included, but are not limited to, the City’s illegal failures to timely and in good faith process and to approve the Bear Hollow Project as required by the DA; its bad faith repudiations and efforts to undermine of the validity and binding nature of the DA and its obligations and Dermody’s vested rights thereunder; and its failure to cure its breaches of and default under the DA within 60 days of receiving Dermody’s formal notice of default under the DA dated January 25, 2023, which notice is attached hereto and incorporated herein by reference; such actions also include those described in other detailed letters written by Dermody’s counsel to the City, including, but not limited to, a letter to the City dated March 20, 2023.

Claimant has vested rights to develop the Bear Hollow Project under the DA, subject only to limited design review discretion and authority by the City Council, which does not extend to denying the Project’s by-right use, modifying its compliant density or intensity, modifying the land use laws, rules and regulations in which Claimant has vested rights, or addressing alleged environmental impacts beyond City’s limited design review authority and discretion. By failing to timely and in good faith process and approve the Bear Hollow Project, the City has breached the express terms of the DA, as well as the express and implied covenants of good faith and fair dealing, and taken Dermody’s vested property rights without payment of just compensation.

The City has violated, breached, defaulted under, and repudiated the DA; violated, taken, and damaged Dermody’s vested property rights, and Dermody’s federally protected civil rights; violated its duties under the express and implied covenants of good faith and fair dealing applicable to the DA; and prejudicially abused its limited discretion by refusing to timely process the complete design review application approval and failing to timely approve the Bear Hollow Project, even after being presented with a formal notice of default pursuant to the DA relating to the same.

ITEM 18.1. ATTACHMENT 5

Stacy Leitner, City Clerk
March 27, 2023

DPML-58478\2758352.4
General Description of Damage/Loss Incurred: The indebtedness, obligation, injury, damage, and/or loss incurred, as far as it is known at this time, includes significant and continuing economic damages and losses of vested property rights suffered by reason of the City’s improper refusals to timely process and approve the Bear Hollow Project, contrary to the terms of the DA and City’s lawful authority, including, without limitation or waiver of any claim to monetary or other relief, out of pocket damages, lost profits, reliance damages, consequential damages, loss and taking of the fair market value of Dermody’s property, and attorneys’ and expert fees, costs, and expenses. These damages, which will continue to accrue, arise from Claimant’s inability and/or unlawfully hindered ability to develop, construct, operate, lease, and/or sell the Bear Hollow Project, and from Dermody’s past and continuing expenditures of substantial sums in reliance on, and to defend and protect, its vested rights under the DA, which the City has repeatedly violated, and continues to violate.

Name of Public Employees Causing Injury: City of Rancho Cordova; City Council of the City of Rancho Cordova. The individual members of the City Council are: Mayor Linda Budge, Vice-Mayor David M. Sander, Ph.D., Siri Pulipati, Garrett Gatewood, and Donald Terry.

Amount Claimed: The estimated amount claimed has been made known the City, exceeds $10,000.00, and is not of an amount that would constitute a limited civil case.

Very truly yours,

MILLER STARR REGALIA
Arthur F. Coon
AFC/mch:klw
w/encl.
cc: Micah Runner, City Manager (w/encl., [email protected]) Elizabeth Sparkman, Community Development Director
(w/encl., [email protected])
Adam Lindgren, City Attorney (w/encl., [email protected]) George Condon, Dermody Properties ([email protected]) Matthew C. Henderson, Miller Starr Regalia
([email protected])
Bill Shiber, Miller Starr Regalia ([email protected]) Nadia L. Costa, Miller Starr Regalia ([email protected]) Travis A. Brooks, Miller Starr Regalia ([email protected]) ITEM 18.1. ATTACHMENT 5

DPML-58478\2730442.2
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
January 25, 2023

VIA EMAIL
Mayor Budge, Vice Mayor Sander, and City
Councilmembers
City of Rancho Cordova
2729 Prospect Park Drive
Rancho Cordova, CA 95670
Email: [email protected]
Re: Dermody Properties’ Notice of City of Rancho Cordova’s Breach of and Default Under Development Agreement and 60-Day Period to Cure; 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:

This firm represents Dermody Properties (“Dermody”), as successor-in-interest to original master developer Elliott Homes, Inc. under that certain “Villages of Zinfandel Development Agreement” entered into as of May 28, 2003, and adopted by County Ordinance No. SZC-2003-0011, which became effective June 28, 2003 (the “Development Agreement” or “DA”), with respect to Dermody’s above-referenced real property located within the 671.39± acre site governed by the DA.

This letter constitutes Dermody’s written notice pursuant to Section 6.1 of the Development Agreement that the City of Rancho Cordova (the “City”), which is successor-in-interest to the County of Sacramento under the DA, has materially breached and is in default of its legal obligations under the DA to timely and in good faith process and approve Dermody’s Major Design Review application for the above-referenced LogistiCenter project located on Dermody’s approximately 10- acre parcel at the corner of North Mather Boulevard and Bear Hollow Drive in the City (the “Design Review Project” or “Project”).

The Project is located within the Villages of Zinfandel Special Planning Area (VOZSPA), an 823± acre area within the Cordova community that transitioned from heavy industrial (surface mining) use and zoning to a comprehensively planned and entitled mixed-use development in the late 1990’s and early 2000’s when the County of Sacramento approved extensive development entitlements for the area, including general plan and zoning amendments, an amended community plan, a ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

DPML-58478\2730442.2
public facilities financing plan, and the subject DA. The VOZSPA’s potential environmental impacts were also comprehensively analyzed under the California Environmental Quality Act (“CEQA”; Pub. Resources Code, § 21000 et seq) through a Final Environmental Impact Report (“FEIR”) certified by the County on March 25, 1998, as supplemented through a Final Supplemental EIR (“FSEIR”) certified by the County on April 26, 2000. The DA was approved by Ordinance No. SZC-2003- 0011, which was adopted on May 28, 2003, and has a 20-year term.

Dermody submitted its Design Review Project application on October 25, 2021, and the City determined the application to be complete on January 12, 2022, over a year ago. The City was required to determine within 30 days of that date, or by November 24, 2021, whether an EIR or negative declaration would be required for the Project. (Pub. Resources Code, §§ 21080.1(a), 21080.2.) Even assuming that the Project is not exempt – which it is – such that a CEQA document of some kind would be necessary, all possible statutory deadlines for the City to have completed its CEQA review of the Design Review Project have now expired without the City Council having completed or adopted any CEQA document or findings. (See Pub.

Resources Code, § 21151.5(a), (1)(A), (B); CEQA Guidelines, § 15107 [if negative declaration is to be prepared, lead agency must complete and adopt same within 180 days after date application is complete, and if EIR is to be prepared, agency must complete and certify same within one year].) The City’s staff and attorneys have consistently advised the Council that the Project is exempt from CEQA under CEQA Guidelines, § 15183. (See Pub. Resources Code, § 21083.3.) For many months Dermody and the City’s own planning staff have advised and reminded the Council of (1) its obligations under the DA, (2) its very limited discretion to conduct CEQA review in the Major Design Review process, and (3) that the Project should be reviewed and found exempt from further environmental analysis under the exemption/streamlined review provisions of CEQA Guidelines section 15183, which the City has applied to similar projects. The Council’s failure to timely complete its CEQA review of the Project in the more-than-one-year period of time that has elapsed since the Project application was determined to be complete, in and of itself, constitutes a bad faith failure to timely process and approve the Project as required by the DA.

The City’s failure to timely process the Project not only violates CEQA and the DA, as explained further below, but has deprived Dermody of legal rights that should also rightfully have accrued to it under the Permit Streamlining Act (“PSA”; Gov.

Code, § 65920 et seq). The PSA provides that a CEQA lead agency must act to approve or disapprove a project within 60 days after a negative declaration is adopted or an exemption determination made. (Gov. Code, § 65950(a)(4), (5).) The City should have completed its CEQA analysis and exemption determination for this Project by the Spring of 2022, at the latest, and acted to approve or disapprove it not later than June 2022 – over six months ago – assuming it had been acting in compliance with CEQA and the PSA, and even setting aside its further legal obligations under the DA.

ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

DPML-58478\2730442.2
In fact, the Project should have been processed to an approval decision even earlier than last summer because – in addition to the basic requirements of CEQA and the PSA – Dermody has vested property and contractual rights under the DA requiring the City’s timely processing of and approval action on its Design Review Project application, and the City’s full and good faith cooperation to enable Dermody to obtain the full benefits of the DA. These DA rights of Dermody, and the City’s corresponding DA obligations, have previously – and repeatedly – been explained to the City in detail, with abundant supporting citations to relevant DA provisions, in prior correspondence from Dermody’s counsel including: (1) Nadia Costa’s July 18, 2022 letter to the City Attorney, copied to the City Manager and Deputy City Manager; (2) my September 16, 2022 letter to City Manager Cyrus Abhar, copied to the City Attorney and Community Development Director; (3) my November 29, 2022 letter to the City Council, copied to the City Manager, Deputy City Manager, and City Attorney; (4) my December 14, 2022 letter to the City Council, copied to the City Manager, Deputy City Manager, and City Attorney; and (5) my January 10, 2023 letter to the City Council, copied to the Community Development Director and City Attorney.1
Despite Dermody’s extensive correspondence repeatedly bringing the City’s attention to its legal obligations under the DA and applicable law, the City Council has ignored and failed even to acknowledge these obligations. Instead, it has repeatedly continued and delayed hearings on the Project beginning in April 2022.

After a half year delay, the City refused to set a hearing for Project approval in November 2022 as Dermody requested. After delays of well over a year from the date of Dermody’s submitted application, and almost a year from the application being deemed complete, the City finally set a December 5, 2022 hearing to consider the Project, but then further continued that hearing without taking action to January 17, 2023. On the latter date, the Council finally closed the public hearing following presentations by City staff and Dermody, and after hearing public comment on the Project, but then refused to discuss, deliberate or take action on Dermody’s Project application, and instead further continued that portion of the hearing to January 30, 2023. The Council voted to further delay a decision on Dermody’s Project so that it could first further consult with the City Attorney (who was present at the January 17 hearing) in closed session concerning an 8-page, single-spaced “late hit” CEQA comment letter submitted by an attorney hired by project opponents which was not received until well after commencement of the January 17 hearing.

Unfortunately, but consistent with the Council’s previous public discussions indicating either a profound misunderstanding of or a heedless intent to exceed its lawful discretion in its consideration of the Project, the Council’s most recent action 1 The foregoing correspondence, and all exhibits thereto, are already part of the Administrative Record in the City’s administrative proceedings on Dermody’s Design Review Project and are fully incorporated by reference in the instant written notice of City’s breach and default under the DA.

ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

DPML-58478\2730442.2
was again taken in bad faith disregard of its DA obligations to timely process and approve the Project. As but one example, when I, as counsel for Dermody, was asked by the Council to come to the podium and respond at the January 17 hearing to the just-received CEQA comment letter and began my response by accurately characterizing it as a typical (and meritless) “late hit” CEQA comment letter, I was interrupted and chided by the Council not to “editorialize.” I found this to be an extremely surprising rebuke since the Council, like the California courts, is surely “aware that the practice of allowing [CEQA] objectors to withhold objections, which could have been raised earlier in the environmental review process, until the last possible moment must be strongly disapproved.” (Galante Vineyards v.

Monterey Peninsula Water Management Dist. (1997) 60 Cal.App.4th 1109, 1120, emph. Added, citing Citizens of Goleta Valley v. Board of Supervisors (1990) 52 Cal.3d 553, 568.) As noted by our Supreme Court in the above-cited case:
“We cannot, of course, overemphasize our disapproval of the tactic of withholding objections, which could have been raised earlier in the environmental review process, solely for the purpose of obstruction and delay. As one federal court has aptly stated: “[T]he NEPA requirement of studying alternatives may not be turned into a game to be played by persons who – for whatever reasons and with whatever depth of conviction – are chiefly interested in scuttling a particular project. [citation.]” (Goleta Valley, supra, 52 Cal.3d at 568, emph. added, citation omitted; see also, e.g., South County Citizens for Smart Growth v. County of Nevada (2013) 221 Cal.App.4th 316 [lengthy “late hit” comment letter from project opponent’s attorney delivered at beginning of Board hearing on project resulted in Board continuing hearing for over a month to respond]; cf. Save North Petaluma River and Wetlands v. City of Petaluma (2022) 86 Cal.App.5th 207 [notwithstanding project opponent’s late hit comment letter submitted on afternoon of hearing, City Council proceeded with hearing and after considering detailed staff memo covering project’s history, public comments, the real party’s public outreach, and numerous responsive project revisions, and the revised project’s satisfaction of the previously expressed planning commission concerns, and after several hours of deliberation and public comment at the hearing, City Council took action as publicly noticed and scheduled and voted to certify FEIR and approved zoning amendments for project].) While Dermody will respond by separate letter to the substance – or, more accurately, the lack thereof – of the Project opponents’ lawyer’s late-hit CEQA comment letter, the above is included for present purposes simply to augment Dermody’s showing as to the City’s continuing bad faith breaches and disregard of its DA obligations. Here, the City Council not only refused to “strongly disapprove” the Project opponents’ “late hit” CEQA tactic, but actually rewarded it with a further two-week delay. By contrast, a council acting in good faith would have quickly and roundly condemned and rejected the Project opponents’ well-recognized and judicially-disapproved abusive CEQA “late-hit” tactic, and would have reminded the Project opponents of the lengthy processing process Dermody has endured to date, ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

DPML-58478\2730442.2
the numerous project amendments and concessions it has voluntarily made and offered to address public concerns, and Dermody’s vested legal and contractual rights to timely processing and approval of its Major Design Review application under the DA. But the Council did not. Instead, it chose to praise the project opponents, as “informed and articulate” and not “typical NIMBYs,” further underscoring its willful disregard for Dermody’s DA and other legal rights to timely and good faith processing of and an approval decision on its Project.2 In other words, for whatever reason, the Council members are continuing to unnecessarily delay their decision on this Project and are publicly praising Project opponents who are vilifying Dermody, encouraging further dilatory City action in processing the Project approvals, and blatantly encouraging the City to repudiate its binding DA obligations. Such conduct is the polar opposite of the good faith required under the DA and applicable law.

In sum, the only conclusion that can be drawn from the record in this matter is this:
the City has violated and breached the Development Agreement and Dermody’s vested rights thereunder by attempting to subject Dermody’s Design Review Project to improper and inapplicable requirements and procedures, and by failing to act in good faith to timely process, act on, and approve the Project. Dermody can no longer wait or give the City Council the benefit of the doubt by assuming that it will ultimately choose to comply with its legal obligations under the DA – the term of which will expire in Summer 2023 – and Dermody has therefore been compelled to now provide this formal notice of default.

As provided in the DA, the City can cure its default and avoid the institution of legal proceedings seeking remedies for its DA breaches, by making a final decision on and approving Dermody’s Project, as the Project was fully presented at the January 17, 2023 meeting, by not later than 60 days from the date of this letter. (DA, § 6.1.)
2 It bears noting that the same Project opponents praised by council members offered comments characterizing my client (or, perhaps, me) as a “playground bully” (for insisting that Dermody’s vested rights be respected) and urging the council to “continue the process as long as needed” (Troy Fennel). The opponents even stated: “There are ways out of this contract [the DA], and you know what they are.” (Greg Mylenberg.) Stunningly, the Council did nothing to correct such misapprehensions or acknowledge its binding obligations under the DA.

ITEM 18.1. ATTACHMENT 5

Mayor Budge, Vice Mayor Sander, and City Councilmembers January 25, 2023

DPML-58478\2730442.2
Thank you for your anticipated attention to these matters.

Very truly yours,

MILLER STARR REGALIA
Arthur F. Coon
AFC:dly/klw
cc: Micah Runner, City Manager ([email protected]) Elizabeth Sparkman, Community Development Director,
([email protected])
Adam Lindgren, City Attorney ([email protected]) George Condon, Dermody Properties ([email protected]) Lucy Crocker, Lucy & Company ([email protected])
Michelle Smira, MMS Strategies ([email protected]) Nadia L. Costa, Esq., Miller Starr Regalia ([email protected]) Travis A. Brooks, Esq., Miller Starr Regalia ([email protected]) ITEM 18.1. ATTACHMENT 5

2729 Prospect Park Dr., #117, Rancho Cordova, CA 95670
(916) 273-5706 ❖ RanchoCordova.org ❖ [email protected] 2 April 2023
Mayor Budge and Councilmembers,
Re: 3 April 2023 Council Agenda Item 16.1
On behalf of the Rancho Cordova Area Chamber, our over 400 members, and their 12,000 employees, I would like to express concern about potential exposure to over $100 million in litigation liability as represented by legal counsel. We recognize that this is a complicated and sensitive situation. We respectfully ask that there be significant focus on the impact of a $100 million hit and, quite possibly, more on our community and future.

Candidly, we have several motives for reaching out. First and foremost, we are very proud of the progress of this amazing city. We were bursting with responsible growth and the attraction of extraordinary businesses to Rancho Cordova. I am proud to hear comments such as "what is going on in Rancho Cordova? You are doing such amazing things!" I assure you that this is a regular occurrence.

Secondly, much of the good work done by this chamber has been with resources provided by Measure R. Our team has grown to six employees and implemented successful business retention programs, including MBARK, Economic Gardening, the RCity app, SMART city assessments, workforce development, and the well-respected Explore program.

If Rancho Cordova is unsuccessful in defending itself against these lawsuits, and the prevailing thought is that it is a real possibility, much is at risk. Including
• The hard work done to shape Rancho Cordova as a forward-thinking city, adaptable and progressively responsive to the needs of our future
• The remarkable work done by community and non-profit organizations when Measure H and R resources are forced to be reallocated
• Current resources supporting law enforcement are reduced • Access to resources that attract businesses within high-value sectors paralleling the success of Solidigm • The capacity to provide matching funds to ensure critical infrastructure projects move forward Many considerations are in play alongside this issue's long and short-term consequences. We urge you to place your fiduciary role at the center of your decision-making. The two decades and thousands of hours you all have committed to Rancho Cordova are recognized and have set a standard of excellence held in high regard. Losing this lawsuit would be a step backward from all you have done to ensure Rancho Cordova is a business-friendly and fiscally well-managed city.

If this litigation is successful, this would not be a tap on the brakes but rather a stomp on the brakes for Rancho Cordova.

Respectfully,
Diann H. Rogers
President & CEO
Cc: M. Runner-City Manager, A. Lindgren-City Attorney, S. Leitner-City Clerk, Chamber Board of Directors ITEM 18.1. ATTACHMENT 5

MEMORANDUM
City Council Staff Report - Page 1 of 1

ITEM 19.1.

DATE: June 5, 2023
TO: Honorable Mayor and Council Members
FROM: Albert Stricker, Public Works Director
Steve Harriman, Public Works Division Manager
SUBJECT: UPDATE THE CITY COUNCIL ON THE COMPETITIVE

PROCUREMENT PROCESS FOR RESIDENTIAL SOLID WASTE

COLLECTION AND STREET SWEEPING SERVICES

RECOMMENDATION
Receive the Presentation.

RESULT OF RECOMMENDED ACTION
The staff presentation will provide an update to the City Council on the schedule, evaluation process, and cost options included in the Request for Proposals (RFP) document for the new residential solid waste collection and street sweeping services contract beginning on January 1, 2025.

BACKGROUND
The current contract for residential solid waste collection and street sweeping services expires on December 31, 2024. On January 17, 2023, the City Council directed staff to proceed with a competitive procurement process for a new contract beginning on January 1, 2025. The staff presentation will provide an update to the City Council on the schedule, evaluation process, and cost options included in the Request for Proposals (RFP), which is scheduled to be released in June 2023.

FISCAL IMPACT AND FUNDING SOURCE
The competitive procurement process has no impact on the City's General Fund.

ATTACHMENT(S)

1. Presentation Solid Waste Procurement

1 Residential Solid Waste,
Recycling and Street Sweeping
Procurement Update
June 5, 2023
ITEM 19.1. ATTACHMENT 1

2 • Republic Services contract for residential waste collection, recycling and street sweeping services expires December 31, 2024.
• On January 17, 2023, the City Council directed staff to proceed with a competitive procurement process for a new contract beginning January 1, 2025.
• The purpose of the presentation tonight is to update the City Council on the procurement process and schedule, and to provide an opportunity for the City Council to comment prior to release of the RFP.
• This is an information item and no City Council action is required.

Introduction
ITEM 19.1. ATTACHMENT 1

3 Survey Highlights
The City retained the Tootelian Company to administer a statistically representative phone survey with 300 respondents to assist with the RFP process and new contract.
• 72% of respondents recognize Republic Services as the current company that provides residential waste collection and recycling services.
• 60% of respondents are very satisfied with current collection programs and 31% are somewhat satisfied.
• 80% of the respondents rated the educational information they received regarding trash and recycling services as very useful (51%) or somewhat useful (29%).

ITEM 19.1. ATTACHMENT 1

4 Survey Highlights (continued…)
• 64% of respondents either strongly agree or agree with the following statement: “The price I pay for trash, organic waste and recycling collection is reasonable for the value I receive”
• 68% of respondents indicated all 3 of their collection carts are in good condition, and 23% said 2 of their 3 carts are in good condition. • 76% of respondents are aware of the Bulky Item Pickup Program, and 47% have used the program at least once in the past year. 13% of respondents used all three appointments in the past year.

ITEM 19.1. ATTACHMENT 1

5 New Agreement Summary
• 10-year term with possible extensions (1/1/25 – 12/30/34) • Weekly garbage and mixed organics collection, including food waste • Biweekly commingled recycling collection
• Curbside oil, filters, sharps and household battery collection • Bulky item collection (3X per year at 10 yards each), with processing of collected materials to recover recyclable and reusable materials • Garbage, recycling and mixed organics collection at City facilities at no cost to City
ITEM 19.1. ATTACHMENT 1

6 New Agreement Summary (continued)
• Garbage, recycling and porta-potty services at 10 City events per year (4th of July, iFest, etc.) at no cost to City
• Billing, customer service and public education
• Street sweeping (14 sweeps per year on residential streets) • 40% minimum “diversion” rate with liquidated damages for noncompliance
• 2,000 cubic yards per year of illegal dumping collection at no cost to City • New compressed natural gas collection vehicles by July 1, 2026 (within 18 months of start of new contract)
ITEM 19.1. ATTACHMENT 1

7 New Agreement Summary (continued)
Estimated annual revenue to City in Year 1 (2025) to cover the City’s cost to manage the solid waste program:
• $700,000 franchise fees @ 8% (escalates annually based on revenue) • $450,000 annual payment for road rehab projects (fixed) • $50,000 annual payment to City for consulting services (fixed) • $150,000 one-time payment to cover staff and consultant costs incurred during RFP process (one-time)
ITEM 19.1. ATTACHMENT 1

8 New Agreement Summary (continued)
Monthly
Service
Rates
Monthly
Rates
7/1/22
Monthly
Rates
7/1/23
Monthly
Rates
7/1/24
Monthly
Rates
1/1/25
32-gallon trash can $27.29 $28.11 $28.95 ?
64-gallon trash can $32.49 $33.46 $34.47 ?
96-gallon trash can $43.27 $44.57 $45.91 ?
Street Sweeping $1.03 $1.06 $1.09 ?
The current and proposed new agreement have “bundled customer rates”, which are based on trash cart size and include all services and programs.

Proposers will be asked to provide monthly rates for each service level starting January 1, 2025.

RFP
ITEM 19.1. ATTACHMENT 1

9 New Agreement Summary (continued)
Annual Rate Adjustments:
• Rates will adjust annually on July 1, starting 7/1/2025 • Adjustments tied to Consumer Price Index for All Urban Consumers: Water, Sewer and Trash Collection Services
(CUSR0000SEHG) published by the Bureau of Labor Statistics • Annual adjustments capped at 5%
• If CPI exceeds 5% in any year, the rollover amount will be added to the following year rate adjustment
ITEM 19.1. ATTACHMENT 1

10 Rate Option #1: Kiefer Landfill
• Proposers will be asked to provide monthly rates with trash disposal at Kiefer Landfill and any other waste disposal facility of their choosing. • Kiefer Landfill is the closest trash disposal facility and therefore represents the least vehicle miles travelled and GHG emissions compared to other disposal facilities.

Municipal tip-fees at Sacramento County’s Kiefer landfill January 1, 2025: $58.55 per ton*
January 1, 2026: $60.35 per ton*
* Represents a $1.00 discount to the public gate rate
ITEM 19.1. ATTACHMENT 1

11 Rate Option #2: New Carts
• The RFP will include a rate option for new carts starting January 1, 2025.
• The current trash, recycling and organics carts are 20 years old and not compliant with labeling and color requirements in State law. • State law requires new carts that meet color and labeling requirements by January 1, 2036.
• Survey data indicate the carts are in usable condition and may have remaining useful life. (68% of survey respondents said all 3 carts are in good condition)
ITEM 19.1. ATTACHMENT 1

12 Rate Option #3: Bulky Item Program
• Rancho Cordova residents may schedule up to 3 bulky item appointments per year @ 10 cubic yards each in the current contract. • This is a very high level of service and exceeds the service levels provided by other jurisdictions in our region.
• 13% of survey respondents used all 3 appointments in the past year. • RFP will include a rate option for 2 appointments per year in order to evaluate the cost savings.

ITEM 19.1. ATTACHMENT 1

13 Proposal Evaluation Process
• This is a proposal process and not a bid process, so the selection is not bound by the lowest price submittal.
• Proposal evaluation committee will be comprised of 3 – 5 members.

Committee will review proposals, conduct interviews and site visits, and provide a recommendation for award to the City Council. • Evaluation Criteria:
• Initial pass/fail review based on completeness of submittal • Price
• Financial stability, company qualifications and references • Experience and track record with similar municipal contracts • Sustainability
• Annual vehicle miles traveled and associated GHG impacts to disposal and processing facilities
• Public education and outreach plan
• Creative strategies to increase waste diversion
ITEM 19.1. ATTACHMENT 1

14 Procurement Process Draft Schedule
• June 5: City Council update prior to release of RFP
• Mid-June: Release RFP document
• Late August: Proposals due
• September – October: Proposal evaluations by committee: (review reference checks, interviews, site visits, etc.)
• November: Staff recommendation on the top-rated proposal presented to the City Council
• December: Staff recommendation for City Manager to execute new contract for consideration by the City Council
• January 1 – December 31, 2024: Transition including public education, new billing system, order new trucks and carts, customer service call center, hire employees, etc.

ITEM 19.1. ATTACHMENT 1

15 Conclusion…
• The overall objective of this process is to achieve the best combination of services, company qualifications and price. • RFP is scheduled to be released in June with the intent to execute a new contract by end of 2023 for a 10-year term starting January 1, 2025.
• Questions?
• Comments?
• Thank you!
ITEM 19.1. ATTACHMENT 1