Public Works Agency
www.santa-ana.org/pw
Item # 20
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
July 1, 2025
TOPIC: Memorandum of Understanding for the Master Plan of Arterial Highways Amendment and Irvine Business Complex Agreement Amendment
AGENDA TITLE
Memorandum of Understanding of the Master Plan of Arterial Highways Amendment with the Orange County Transportation Authority and the City of Irvine and the Irvine Business Complex Agreement Amendment
RECOMMENDED ACTION
1. Approve a memorandum of understanding for the Master Plan of Arterial Highways Amendment with the Orange County Transportation Authority and the City of Irvine (Agreement No. A-2025-XXX).
2. Approve an Amendment to the Irvine Business Complex Agreement (Agreement No. A-2025-XXX).
GOVERNMENT CODE §84308 APPLIES: No
DISCUSSION
Background
The Master Plan of Arterial Highways (MPAH) is a countywide roadway network designed to manage, improve, and support regional mobility and is managed by the Orange County Transportation Authority (OCTA). Established in 1956, the MPAH was created to complement the county’s developing freeway system and has evolved into a critical element of Orange County’s long-range transportation policy. Cities must adhere to the MPAH in order to remain eligible for Measure M2 funding. When a local agency proposes changes to the MPAH, coordination and consensus among the affected cities is required.
Over the years, the MPAH has played a crucial role in shaping the county’s transportation infrastructure, ensuring a coordinated effort between OCTA and the cities within Orange County. The primary goal of the MPAH is to outline a regional arterial highway system that supports existing and future land uses, ensuring that roads are designed to accommodate projected traffic volumes. It aims to provide a circulation system that complements the county’s freeway network, focusing on the efficient
Memorandum of Understanding for the Master Plan of Arterial Highways Amendment and Irvine Business Complex Agreement Amendment
July 1, 2025
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movement of people and goods. Amendments to the MPAH typically change the traffic capacity of roadways and may result in traffic impacts on other roadways. Amendments to the MPAH must include mitigation and be agreed to by OCTA, the City requesting amendment, and affected Cities.
In 1992, the Cities of Santa Ana and Irvine entered into an agreement entitled “Implementation of Roadway and Interchange Mitigation Program” to jointly share in the responsibilities of road improvements resulting from new development around the boundaries of both cities. In 2011, both cities executed a restatement of the agreement incorporating the City of Irvine’s Irvine Business Complex (IBC) general plan amendment. Via the 2011 restatement, a number of major improvement projects were identified and development thresholds and fair share contributions were established.
Notably, IBC development would be capped at 51 million square feet of office space equivalency until both the proposed Alton Avenue freeway overcrossing project and the Dyer Road widening projects are completed (39.8 million square feet of office space equivalency has been built).
As part of the City of Irvine’s recent efforts to transform the Irvine Business Complex (IBC) from an area dedicated primarily to office, industrial, and commercial uses into a fully integrated mixed-use business and residential community, the City of Irvine (Irvine) updated its IBC Vision Plan, including the 2018 Traffic Study Update. In June 2019, the study recommended amending the MPAH and eliminating the proposed widening of Red Hill Avenue from four to six lanes between MacArthur Boulevard and Main Street.
As a result, corresponding mitigation obligations in the City of Santa Ana were identified as a responsibility of the City of Irvine.
On April 19, 2022, City of Santa Ana adopted its General Plan Update (GPU). As part of the GPU, a traffic operation study, separate from the California Environmental Quality Act (CEQA) process, was conducted. This traffic study identified traffic operational impacts and improvement mitigations at locations within the City of Irvine. As a result, corresponding mitigation obligations in the City of Irvine were identified as a responsibility of the City of Santa Ana.
Prior Council Action
At the April 16, 2024 City Council meeting, Staff recommended a Memorandum of Understanding (MOU) with Irvine and OCTA regarding the proposed MPAH changes resulting from the IBC plan updates for consideration. The proposed MOU was not approved by Council. At the meeting, City Council expressed concerns with proposed traffic mitigations, specifically the fair share contributions and proposed traffic infrastructure improvement. In response to City Council concerns, staff reinitiated negotiations with Irvine and OCTA to further discuss and refine the proposed recommendations in the MOU. In these new negotiations, Staff proposed a broader Memorandum of Understanding for the Master Plan of Arterial Highways Amendment and Irvine Business Complex Agreement Amendment
July 1, 2025
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discussion to include unresolved mitigations resulting from the City of Santa Ana’s General Plan update with the goal of obtaining the best overall outcomes for Santa Ana.
City of Irvine and OCTA Memorandum of Understanding
The City of Irvine proposes to reduce Red Hill Avenue between MacArthur Boulevard and Main Street from a six-lane divided highway to a four-lane divided highway as part of the IBC Vision Plan and prepared an associated traffic study. Among other things, the traffic analyzes cross-jurisdictional impacts, mitigations, and fair share values.
Staff has reviewed the study and fair share amounts and found that the calculations are accurate and in line with standard transportation norms. Staff finds that the proposed fair share amounts resulting from the IBC Vision Plan update are confirmed to be accurate and correct.
As part of the negotiations with Irvine and OCTA, alternate traffic improvements from the ones originally proposed in the study were discussed. Staff proposed selecting the following two intersections from the City’s traffic signal priority list for mitigation improvements:
•Flower Street at Segerstrom Avenue, and
•Flower Street at MacArthur Boulevard.
Prior city traffic study assessments identified the need for left-turn arrows at both of these intersections’ traffic signals. To date, these locations are on the City’s traffic signal priority list. Understanding the need for improvements at these two intersections, Irvine and OCTA agreed that the fair share funds identified in the MOU will go towards funding these locally preferred improvements to install left turn arrows at both locations.
With the approval of the MOU, the City of Irvine will provide the City of Santa Ana fair share funding for Flower Street at Segerstrom Avenue in the amount of $37,224 and fair share funding for Flower Street at MacArthur Boulevard in the amount of $45,070.
These fair share funds will be leveraged with existing Council approved funds to construct the improvements.
Both projects are identified in the City’s Capital Improvement Program (CIP). The Flower at Segerstrom project is fully funded and will be in bid phase this month. The Flower at MacArthur intersection was recently approved by Council and staff has commenced on the design phase.
Staff recommends approval of the Memorandum of Understanding with Irvine and OCTA (Exhibit 1).
Memorandum of Understanding for the Master Plan of Arterial Highways Amendment and Irvine Business Complex Agreement Amendment
July 1, 2025
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Amendment to IBC Agreement (City of Irvine and City of Santa Ana Agreement) The existing agreement between the cities of Irvine and Santa Ana related to the IBC identifies four mitigation projects to be funded as follows:
Existing Agreement
Project Santa Ana Share Irvine Share
Red Hill Ave. & Alton Parkway Intersection 50% 50%
Dyer Rd: SR-55 to Red Hill Ave. 0% 100%
Alton Parkway SR-55 Overcrossing 50% 50%
Von Karman Ave. & Barranca Parkway
Intersection 14% 86%
The City of Santa Ana’s GPU traffic study identified significant traffic congestion on the segment of Dyer Road between the SR-55 and Red Hill Ave. To account for the mitigation requirements subsequently identified in the City of Santa Ana’s GPU traffic study, the proposed amendment to the IBC agreement will reduce the City of Irvine’s fair share from their original 100%. Staff has negotiated with the City of Irvine for Santa Ana to contribute a maximum of 23% fair share toward the project and, in return, the City of Irvine has agreed to eliminate the City of Santa Ana’s responsibility for fair share contributions (14%) to the intersection of Von Karman Avenue and Barranca Parkway project located within Irvine.
Staff recommends moving forward with improvements to Dyer Road and City Council has approved Resolutions to apply for grant funding. Grant funding for the design phase of Santa Ana’s share of Dyer Road Improvements has been secured and additional grant funding will be pursued for future phases such that the actual amounts contributed by Santa Ana from local funds for the project will be significantly reduced.
The following lists the traffic improvement mitigation projects and the respective fair share contributions for each in the proposed agreement:
Proposed Agreement
Project Santa Ana Share Irvine Share
Red Hill Ave. & Alton Parkway Intersection
(No change) 50% 50%
Dyer Rd: SR-55 to Red Hill Ave. 23% 77%
Alton Parkway SR-55 Overcrossing
(No change) 50% 50%
Von Karman Ave. & Barranca Parkway
Intersection 0% 100%
It is worth noting that at this time there is no determination of when or if the IBC thresholds required for the City of Irvine’s fair share to be triggered for the Alton Memorandum of Understanding for the Master Plan of Arterial Highways Amendment and Irvine Business Complex Agreement Amendment
July 1, 2025
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Overcrossing and Dyer Road projects will be met. As part of this proposed agreement, the City of Irvine will contribute their fair share towards the Dyer Road project prior to thresholds being triggered.
Staff recommends approval of the amendment to the IBC Agreement with City of Irvine (Exhibit 2).
ENVIRONMENTAL IMPACT
There is no environmental impact associated with this action.
FISCAL IMPACT
The two traffic signal improvements identified in the proposed MOU have been identified in the City’s Capital Improvement Program. At the time of construction contract award, Staff will present recommendations to receive and appropriate the City of Irvine fair share amounts for the projects.
The projects identified in the proposed IBC amendment will be programmed into a future CIP and funded accordingly. At the time of design, right of way, and construction contract awards, Staff will present recommendations to receive and appropriate the City of Irvine fair share amounts for the projects. There is no fiscal impact at this time.
EXHIBIT(S)
1. Memorandum of Understanding
2. Irvine Business Complex Agreement Amendment
Submitted By: Nabil Saba, P.E., Executive Director – Public Works Agency Approved By: Alvaro Nuñez, City Manager