City of San Juan Bautista
The “City of History”
www.san-juan-bautista.ca.us
AGENDA
SPECIAL CITY COUNCIL MEETING
TUESDAY ~ JULY 12, 2022 ~ 6:00 PM
~ PUBLIC PARTICIPATION BY ZOOM ONLY ~
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Meeting ID: 814 2464 2057
Public comments will be taken on items on the agenda at the times the matters are heard by the Council. To provide verbal public comment call the phone number listed above or log into zoom and enter the meeting id number as listed above.
When the Mayor announces public comment is open, press *9 on your telephone keypad or if joining by Zoom, use the raise your hand icon. When called to speak, please limit your comments to three (3) minutes, or such other time as the Mayor may decide, consistent with the time limit for all other speakers.
Written comments may be mailed to the Deputy City Clerk at City Hall (P.O. Box 1420, San Juan Bautista, CA 95045), or emailed to [email protected] not later than 5:00 p.m., July 12, 2022, and will be read into the record during public comment.
1. Call to Order
Pledge of Allegiance
Roll Call
2. Public Comment Only on Items on the Agenda
3. Closed Session
A. Conference With Legal Counsel – Anticipated Litigation Significant exposure to litigation pursuant to paragraph (2) of subdivision (d) of CA Govt. Code Section 54956.9: one potential case.
B. Evaluation Of Public Employee
City Manager
THIS MEETING WILL BE CONDUCTED PURSUANT TO THE PROVISIONS OF THE GOVERNOR’S EXECUTIVE ORDER N-29-20
In order to minimize the spread of the COVID 19 virus the City Council is conducting this meeting by Zoom conference and will be offering alternative options for public participation.
Please follow the CDC Guidelines regarding preventative measures and do your part to help flatten the curve and prevent further spread of COVID-19.
In compliance with the Americans with Disabilities Act, and Governor’s Order N-29-20, the City will make reasonable arrangements to ensure accessibility to this meeting. If you need special assistance to participate in this meeting, please contact the Deputy City Clerk a minimum of 48 hours prior to the meeting at (831) 623-4661.
4. Action Item
A. Approve Affidavit of Posting Agenda
5. Discussion Item
A. Consider Adoption of Resolution Approving the First Amendment to the Reimbursement Agreement Between the City and SJB
Alameda Enterprises, LLC, for Construction of a Right Turn Lane on State Route 156 At Its Intersection With The Alameda
B. Public Meeting Format Changes Anticipated for July 19, 2022. Regular Meeting
6. Adjournment
Item 5.A
City Council
July 12, 2022
CITY OF SAN JUAN BAUTISTA
CITY COUNCIL REPORT
1 AGENDA TITLE: DISCUSSION ITEM REGARDING
A RESOLUTION APPROVING A FIRST
AMENDMENT TO THE REIMBURSEMENT
AGREEMENT FOR CONSTRUCTION OF A
RIGHT TURN LANE ON STATE ROUTE 156 AT
ITS INTERSECTION WITH THE ALAMEDA
MEETING DATE: JULY 12, 2022
DEPARTMENT HEAD: CITY MANAGER/CITY ATTORNEY
RECOMMENDED ACTION:
Discuss and provide direction concerning the Resolution attached as Exhibit A approving the “First Amendment to Reimbursement Agreement,” subject to final review and approval of the City Manager and the City Attorney, and authorize and direct the Mayor to sign the First Amendment on behalf of City.
BACKGROUND INFORMATION:
On February 4, 2014, the Planning Commission approved, on an application received from Mr.
Harbhajan (Harvey) Dadwal on behalf of SJB Development, LP. (“SJB Development”), Conditional Use Permit 2014-11 for a project consisting of one single-story building comprising of a 2,980 square foot convenience store, a separate 3,342 square foot quick-serve restaurant, and a gas station with 12 fuel dispensing stations (the “Project”) on the property then owned by SJB Development located at 404-408 The Alameda (APN 002-52-012) at the south-west corner of The Alameda and State Route 156.
On November 18, 2014, the City Council denied an appeal of the Project and approved Conditions of Approval for the Project. The Council’s Conditions of Approval differed slightly from those adopted by the Planning Commission. City Council Condition of Approval No. 18 provided for SJB Development to contribute $200,000 for the construction of an eastbound right turn lane (“Right Turn Lane”) on the south side of State Highway 156 at its intersection with The Alameda (“Intersection”) and to enter into a Reimbursement Agreement for reimbursement of SJB Development for its costs in excess of the Project’s fair share. Condition 18 provided for construction of the Right Turn Lane to commence prior to or concurrent with the construction of the Project. The Project cannot be granted an occupancy permit until the Right Turn Lane is completed.
Item 5.A
City Council
July 12, 2022
CITY OF SAN JUAN BAUTISTA
CITY COUNCIL REPORT
2 A traffic analysis was completed for the Project to determine the cumulative traffic impact on the Intersection resulting from the Project. This analysis determined the impact from the Project and from prospective future development would not result in the need for construction of the Right Turn Lane until 2035, hence the construction in conjunction with the Project was determined to be over capacity.
On August 18, 2015, SJB Development and the City entered into a Reimbursement Agreement to provide for the City to construct the Right Turn Lane and to be reimbursed by SJB Development in the amount of $200,000 and for SJB Development to be reimbursed in turn from fees and exactions imposed upon prospective future projects which contribute to cumulative impact of traffic on the Intersection, such that SJB Development’s payment to the City would be equal to the Project’s fair share cost for the Right Turn Lane. At the time the Reimbursement Agreement was entered into the cost of the Right Turn Lane was estimated to be $240,000. The Copperleaf Development contributed 20% ($44,000) of this amount to the Right-Hand Turn Lane.
The Project was subsequently subject to delays due to litigation. SJB Alameda Enterprises, LLC, (“Alameda Enterprises) has now succeeded to SJB Development’s interest in the property and the Project. It has been further delayed by the negotiations regarding the payment for the Right Turn Lane, the City’s development fees, and the Cal Trans review. The project has been approved for its building permit since December 2021, but the nature of the fee payments and when they will be paid was tied up in the Amendment to the Reimbursement Agreement negotiations. Cal Trans had the completed building plans at its District 5 Office for four months and then decided to send them to Sacramento for approval. They halted their review in 2021, when the SJB Development was unable to acquire the right-of-way required for the Right Turn Lane.
DISCUSSION
The California Department of Transportation, (“Cal Trans”), Alameda Enterprises, and the City now wish to continue to provide for the Right Turn Lane to be constructed prior to or concurrent with the Project, provide for a new traffic analysis to be completed, and recognize that the construction of the Right Turn Lane at this time is likely to continue to be in excess of capacity, and that the costs of construction have increased substantially since 2015 to an amount estimated to be in excess of $600,000 and may be expected to continue to increase in the future.
Accordingly, Council may wish to discuss and consider amending the Reimbursement Agreement in accordance with the First Amendment (attached hereto as Exhibit B) to extend its term to August 31, 2042, unless otherwise extended or terminated earlier, to provide for the City to construct the Right Turn Lane and to be reimbursed for the full cost of construction by Alameda Enterprises and for the City to in turn reimburse Alameda Enterprises for Alameda Item 5.A
City Council
July 12, 2022
CITY OF SAN JUAN BAUTISTA
CITY COUNCIL REPORT
3 Enterprises’ payment in excess of Alameda Enterprises’ fair share, as conclusively determined by the new traffic analysis, of the cost for the Right Turn Lane from fees and exactions imposed on future development within a benefit area to be defined by the new traffic analysis which contribute to the cumulative traffic impact on the Intersection, and if necessary, from a portion of the sales tax revenue generated by the Project, until such time as Alameda Enterprises has been reimbursed such that Alameda Enterprises’ unreimbursed payment to the City is equal to the Project’s fair share.
To-restart the Cal Trans review, the City has assumed the responsibility for acquiring the rightof-way. The City’s consultant Hamner Jewel was retained for $16,000 in May, and they are familiar with process dictated by Cal Trans. The Reimbursement Agreement stipulates how the City will be reimbursed for these costs.
Most importantly, the Agreement proposes that the estimated $85,000 in impact fees be applied to the Right Turn Lane cost as a credit, or deferred until payment of the impact fees until occupancy. The Traffic Impact fees of an estimated amount of $31,000 would be appropriately applied to the construction of the Right Turn Lane, and it makes sense to credit Alameda Enterprises rather than have them pay the fees, only to be reimbursed. The balance of impact fees (that apply to schools, public safety, parks, libraries, etc), are recommended to be deferred until the Project and the Right Turn Lane are completed so they can be paid by permanent project financing (rather than the short-term construction loan, thereby reducing the amount of the short-term construction loan) for the project by Alameda Enterprises. Agreeing to these terms is now the critical path for the Project to start construction.
Lastly, the consideration of the sales tax contribution is simply a guarantee. The City is being asked to supplement the payment to Alameda Enterprises if after 20-years Alameda Enterprises has not been fully reimbursed. There is a risk for the City that this may happen, but interest in developing the industrial properties on San Juan Hollister Road, and Lang Street offer some assurance that there will adequate contributions made by these future projects to satisfy the Alameda Enterprises’ debt without impact the City’s general fund. In the First Amendment, the City has agreed to complete a traffic impact benefit study that defines which properties when developed will be contributing to this Right Turn Lane. The same analysis is required for the north part of town in relation to the Round-About and Meritage reimbursement agreement approved earlier this year.
FISCAL IMPACT:
If all goes according to plan there should be no fiscal impact on the city provided sufficient new future development provides sufficient fair share contributions to make Alameda Enterprises whole for the amount spent in excess of Alameda Enterprises fair share – but the First Item 5.A
City Council
July 12, 2022
CITY OF SAN JUAN BAUTISTA
CITY COUNCIL REPORT
4 Amendment, like the Reimbursement Agreement, makes the City responsible for any shortfall.
This contribution from Alameda Enterprises is being offered without interest or penalties except for the guarantee of satisfying the debt after 20-years including with some part of the sales tax it generates.
The second largest generation of sale tax comes to the City from its only gas station. Adding this second gas station to the collection of sales tax, could easily generate $100,000 per year for the City’s General Fund.
CEQA: Exempt per Section 15061(b) (3) of State CEQA Guidelines. The First Amendment merely sets forth the roles of the Parties with respect to funding of the Project. Therefore, it can be seen with certainty that there is no possibility that the execution of the First Amendment may have a significant effect on the environment.
ATTACHMENTS:
Exhibit A - Proposed Resolution
Exhibit B - First Amendment to the Reimbursement Agreement 1 | RTL Resolution
RESOLUTION NO. 2022-_____
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN JUAN
BAUTISTA APPROVING THE FIRST AMENDMENT TO THE
REIMBURSEMENT AGREEMENT BETWEEN THE CITY AND
SJB ALAMEDA ENTERPRISES, LLC, FOR CONSTRUCTION OF A RIGHT TURN LANE ON STATE ROUTE 156 AT ITS INTERSECTION
WITH THE ALAMEDA
-o0oWHEREAS, on February 4, 2014, the Planning Commission approved Conditional Use Permit 2014-11 for one single-story building consisting of a 2,980 square foot convenience store, a separate 3,342 square foot quick-serve restaurant, and a gas station with 12 fuel dispensing stations (“Project”) on the property then owned by SJB Development, LP. located at 404-408 The Alameda (APN 002-52-012) at the corner with State Route 156; and
WHEREAS, on November 18, 2014, the City Council denied an appeal of the Project and approved Conditions of Approval for the Project; and WHEREAS, City Council Condition of Approval No. 18 provided for SJB Development to contribute $200,000 for the construction of a deceleration and right turn lane (“Right Turn Lane”) on the south side of State Highway 156 at its intersection with The Alameda (“Intersection”) and to enter into a Reimbursement Agreement with the City for reimbursement to SJB Development for its contribution found to be in excess of the Project’s fair share cost; and
WHEREAS, the traffic analysis for the Project determined the cumulative traffic impact on the Intersection resulting from the Project and from prospective future development would not result in the need for construction of the Right Turn Lane until 2035, hence construction in conjunction with the Project was determined to be overcapacity; and WHEREAS, on August 18, 2015, SJB Development and the City entered into a Reimbursement Agreement to provide for the City to construct the Right Turn Lane and to be reimbursed by SJB Development and in turn for SJB Development to be reimbursed for its contribution from fees and exactions imposed upon prospective future projects which contribute to cumulative impact of traffic on the Intersection such that SJB Development’s contribution to the City was equal to the Projects fair share cost for the Right Turn Lane; and
WHEREAS, on January 26, 2022, by Grant Deed, SJB Alameda Enterprises, LLC, (“Alameda Enterprises) has succeeded to SJB Development’s interest in the property and the Project; and
2 | RTL Resolution
WHEREAS, Condition 18 has to be met, the California Department of Transportation (Cal Trans”), Alameda Enterprises, and the City wish to continue to provide for the Right Turn Lane be constructed competed before the occupancy of the project can be granted, provide for a new traffic analysis to be completed, and recognize excess of capacity of the design to accommodate traffic estimates through 2035, and that due to the need to incorporate design changes required by Cal Trans, cost of construction materials and other various reasons, the cost of construction of the Right Turn Lane at this time have increased substantially since 2015 and are expected to continue to increase in the future; and
WHEREAS, Alameda Enterprises and the City now desire to amend the Reimbursement Agreement to extend its term to August 31, 2042, unless otherwise extended or terminated earlier, to provide for the City to construct the Right Turn Lane and to be reimbursed for the full cost of construction by Alameda Enterprises and for the City to in turn reimburse Alameda Enterprises for Alameda Enterprises’ payment of construction costs in excess of Alameda Enterprises fair share, to be conclusively determined by the new traffic analysis, of the cost for the Right Turn Lane from fees and exactions imposed on future development within a benefit area as defined by the new traffic analysis which contribute to the cumulative traffic impact on the Intersection and if necessary, from a portion of the sales tax revenue generated by the Project.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN
JUAN BAUTISTA HEREBY RESOLVES AS FOLLOWS:
SECTION 1. This Council hereby approves the “First Amendment to Reimbursement Agreement” (the referenced seven page (without exhibits), subject to final review and approval of the City Manager and the City Attorney, and authorizes and directs the Mayor to sign the First Amendment on behalf of City. 3 | RTL Resolution
THE FOREGOING RESOLUTION WAS ADOPTED at a special meeting of the San Juan Bautista City Council duly called and held on the 12th day of June, 2022, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
_______________________________
Leslie Q. Jordan, Mayor
ATTEST:
_____________________________
Don Reynolds, City Manager/Acting City Clerk
APPROVED AS TO FORM:
_____________________________
Robert W. Rathie, City Attorney