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CONSIDERATION OF A REQUEST BY THE CORKY MCMILLIN COMPANIES THAT THE CITY COUNCIL FORM A REIMBURSEMENT DISTRICT FOR THE CONSTRUCTION OF TOWN CENTER DRIVE (This item was continued from 7/25/17.)
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RECOMMENDED ACTION
Recommended Action
Council not direct the City Manager to begin proceedings for the formation of a reimbursement district.
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SUMMARY
Under Chapter 15.50 of the Chula Vista Municipal Code (CVMC) a developer who believes that they have been required to construct or have constructed public improvements that benefit other property owners who have made no contribution to the costs of those improvements may request that City Council direct the City Manager to begin proceedings for the formation of a reimbursement district.
The City Clerk received a request (Attachment 1) for the formation of a reimbursement district from the Corky McMillin Companies (Developer) for the construction of the portion of Town Center Drive between Olympic Parkway and the Otay Ranch Mall property line. On July 18, 2017 the Developer requested the item be continued to allow them to submit a letter to include in the record of the public hearing (Attachment 2).
After looking further at the circumstances surrounding the construction of Town Center Drive and reviewing the applicable sections of CVMC Chapter 15.50 and State Regulations, City staff does not support beginning district formation proceedings.
ENVIRONMENTAL REVIEW
Environmental Notice
Environmental Notice
The activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
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Environmental Determination
The Director of Development Services has reviewed the proposed activity for compliance with the California Environmental Quality Act (CEQA) and has determined that the activity is not a “Project” as defined under Section 15378 of the State CEQA Guidelines because it will not result in a physical change in the environment; therefore, pursuant to Section 15060(c)(3) of the State CEQA Guidelines, the activity is not subject to CEQA. Thus, no environmental review is required.
BOARD/COMMISSION RECOMMENDATION
Not Applicable
DISCUSSION
The request made by the Developer on May 31, 2017 for the City to begin formation of a reimbursement district under CVMC Chapter 15.50 involves the evaluation of whether the Developer was required by the City to construct a public improvement that provided additional benefit to property owners that did not contribute to those improvements. In this case the construction of Town Center Drive occurred as a result of a number of actions including the creation of the Sectional Planning Area Plan for Village 12 - Freeway Commercial including subsequent amendments, a General Development Plan and project specific approvals including tentative maps and street dedications.
As identified in the Developers letter (Attachment No. 1), they had previously entered into a private reimbursement agreement with Otay Project, L. P. (Baldwin and Sons) to recover their cost of constructing Town Center Drive (Attachment No.3). City staff believes a dispute over the timing and enforceability of this agreement between the two parties is the basis for the Developer’s request for district formation. Because there is an agreement between the two parties outlining an agreement to share costs for the construction of public improvements that benefitted both parties, reimbursement district formation is unnecessary, nor is it required.
Should the City Council choose to form the requested reimbursement district, it would be formed pursuant to the provisions of CVMC Chapter 15.50 and Government Code section 66485 through 66489. Formation of a reimbursement district would include a public hearing before the City Council, with affected property owners being provided notice and an opportunity to be heard at the public hearing (see CVMC 15.50.080). If a reimbursement district was ultimately formed, reimbursement would only occur when a benefitted property owner either subdivided the benefited property or pulled a building permit for the benefited property (see CVMC 15.50.090).
DECISION-MAKER CONFLICT
Staff has reviewed the property holdings of the City Council members and has found no property holdings within 500 feet of the boundaries of the property which is the subject of this action. Consequently, this item does not present a disqualifying real property-related financial conflict of interest under California Code of Regulations Title 2, section 18702.2(a)(11), for purposes of the Political Reform Act (Cal. Gov’t Code §87100, et seq.).
Staff is not independently aware, and has not been informed by any City Council member, of any other fact that may constitute a basis for a decision maker conflict of interest in this matter.
LINK TO STRATEGIC GOALS
N/A
CURRENT YEAR FISCAL IMPACT
None
ONGOING FISCAL IMPACT
The cost of City processing requests for formation of reimbursement districts would be borne by the developer requesting formation.
ATTACHMENTS
Attachment 1 - Formation Request Letter
Attachment 2 - Letter from the Corky McMillin Companies Requesting Continuance
Attachment 3 - Right of Way Agreement and Agreement to Reimburse Construction Costs
Staff Contact: Kelly Broughton, Director of Development Services