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HomeMy WebLinkAbout1999-03-23 - AGENDA REPORTS - MOU SC LLC PORTA BELLA PROP (2)AGENDA REPORT City Manager Approval Item to be presented b34 Jeffrey Lambert NEW BUSINESS DATE: March 23, 1999 SUBJECT: MEMORANDUM OF UNDERSTANDING (MOU) WITH SANTA CLARITA LLC (OWNERS OF THE PORTA BELLA PROPERTY) DEPARTMENT: Planning and Building Services RECOMMENDED ACTION City Council approve the Memorandum of Understanding (MOU), direct the City Manager to execute the MOU, and direct staff to process the described Porta Bella Specific Plan and Development Agreement amendments through the Planning Commission and City Council. BACKGROUND The Porta Bella Specific Plan (and related actions) was approved by the City Council on September 12, 1995. The Porta Bella Development Agreement, a contract vesting the entitlements issued for this project for 20 years, was approved by the City Council on September 12, 1995. These documents reflect the City's approval of the Porta Bella project consisting of 2,911 residential units, 92 acres of commercial and industrial uses, 434 acres of open space and recreational uses, and other uses. Through the Development Agreement, the City received several benefits from the developer including the grading of the future civic center site, early construction of needed roadways, a Metrolink station, transit maintenance facility site, and a future institutional site. At the time the Development Agreement was approved, the City Council imposed a condition that "no development can occur on the property until the entire site is cleaned and certified by the Department of Toxic Substances Control (DTSC)." The Porta Bella property was recently purchased by Santa Clarita LLC. All terms and conditions imposed by the City on Porta Bella are transferred to Santa Clarita LLC and they continue to be responsible to satisfy the City's land use requirements as well as the DTSC's clean up requirements. City staff, Santa Clarita LLC, and the DTSC have been meeting regularly to ensure the timely and thorough clean up of the property. ANALYSIS Both the new owners and City staff have realized that the condition to prevent any development until the entire site is clean will significantly delay the clean up of the Porta Bella site. The current owner will not have the financial resources to complete the clean up in a timely manner unless they are allowed to develop the project in phases as each phase is cleaned and certified by the DTSC. The DTSC staff have verified that a phased clean up approach is not only acceptable, but is the proven method for clean up of sites of this size and complexity. The DTSC has reported to staff and to the Council at a study session held in late 1998, that phased cleanup is appropriate. It should be noted that the specific method and schedule for clean up continues to be discussed by the property owner and DTSC. It should also be clear that DTSC's certification of a clean up effort on a portion of the site (called operable units or OUs) will include certification that any contamination on remaining portions of the site will not later contaminate the cleaned up OU. The MOU presented to the City Council is a non-binding agreement between the City and the property owner. It outlines the basic terms within which further negotiations will take place. These further negotiations will require action by the City Council, after consideration by the Planning Commission, of amendments to the Porta Bella Development Agreement and Specific Plan. Deal points in the MOU of note include the extension of the term of the lease for the Commuter Rail Station Site (Metrolink) to August 21, 1999. Under the current terms of the agreement, the City must purchase this property by April 21, 1999. The agreement also states that the property owner will deed the property to the City upon the recordation of their first subdivision. Since funds are not available and the property owner cannot record the first subdivision by April 21, 1999, the MOU allows for the extension of the terms of the lease until such time as the property can be transferred to the City. The MOU also allows for the phased development of the site, in accordance with clean up efforts approved and certified by the DTSC. The soil contamination of this site is best addressed through a phased clean up effort. This will allow the clean up to occur in an accelerated manner. The Council is aware of the perchlorate contamination in the ground water as a result of past activities on the Porta Bella property. This clean up effort is urgent because the longer the clean up takes, the more this contamination moves beyond the site boundaries. Therefore, it is very important that the City work with the property owner and the DTSC to expedite this clean up effort. Phased clean up and development by operable units will allow this. The expedited cleanup and development of the Porta Bella site will also accelerate the construction schedule for Golden Valley Road and the proposed Golden Valley High School site. The City has required that any phased clean up and development must address the most easterly OU first. This is the portion of the site traversed by Golden Valley Road. ALTERNATIVE ACTIONS 1. Deny the MOU resulting in delayed site clean up and needed roadway construction 2. Other action as determined by the City Council FISCAL IMPACTS No fiscal impacts are anticipated by the recommendations listed in this report. ATTACHMENTS Memorandum of Understanding JJL:lep s:\pbs\council\portbelIdoc PORTA BELLA PROJECT MEMORANDUM OF UNDERSTANDING Preamble This Memorandum of Understanding ("MOU") is designed to summarize the basic elements of understanding of the City of Santa Clarita ("City') and Santa Clarita, LLC ("Owner") regarding the development of approximately 996 acres located within the Porta Bella Project ("Project"). The purpose of this MOU is to outline a non-binding understanding between the City and Owner with respect to certain matters which are fundamental to the City and Owner, and without which, the time and effort that will go into negotiating and approving an Amendment to the existing Development Agreement, Conditions of Approval and Commuter Rail Station Site Lease would not be warranted. The City and the Owner also recognize that each of the points outlined below are essential to proceeding with the negotiation and approval of amendments to the Development Agreement, Conditions of Approval, Commuter Rail Station Site Lease and other entitlements. It is understood and agreed that this MOU does not contain all the essential terms that the parties expect will be part of such agreements or terms of approval. The City and Owner recognize that there may be significant benefits to the parties if the Porta Bella Project is developed within the City. For the purposes of this MOU, the "DTSC" shall mean the Department of Toxic Substances Control of the State of California; the phrase "OU" shall mean an operable unit as agreed to by the DTSC and Owner. City Benefits 1. The City would have the right to extend the term of the lease for the Commuter Rail Station Site for a period of sixty (60) days until June 21, 1999, with an automatic second 60 -day extension until August 21, 1999 unless the City gives Owner written notice of its election not to extend by June 11, 1999. 2. Remediation of the Site will be accelerated by allowing earlier commencement and financing. 3. Owner would dedicate to the City certain land and a related slope easement (if necessary) as generally shown on Exhibits "I -A— D" attached, after this land has been remediated by Owner and released by the DTSC, for a mutually agreed route of Golden Valley Road in the northeast comer of the Project. 4. Owner would consent to the elimination or redesign of Santa Clarita Parkway as a result of the realignment of Golden Valley Road, provided any modification must be supported by an independent traffic study and subject to City processing and approval of a General Plan amendment. 30005943\VA 5. Owner would dedicate to the City up to 8 acres of land within the Project, at a mutually agreeable location, for use by the City as a transit maintenance facility. 6. Owner would dedicate to the City up to _ acres of flat land within the Project at a mutually agreeable location, for use by the City as an institutional site. 7. The City would be able to construct Golden Valley Road and the School District could open the new high school more quickly than otherwise based on the phased remediation sign -off of OU's and the phased development of the Project, to which DTSC has confirmed they have no objection. Owner's Benefits 1. Consistent with DTSC approvals, Owner will be able to remediate OU's and after receiving DTSC clearance on an OU, develop such OU or portion thereof, after such sign -off. 2. In order to mitigate the negative impacts to the Project of the realignment of Golden Valley Road and Owner's dedication of land to the City for Golden Valley Road, (a) the Community Commercial parcel shall be relocated east to the northwest quadrant of the new intersection of Via Princessa and Golden Valley Road, and (b) the City shall cooperate with Owner in the transfer of ownership of the adjacent land created at this intersection, and (c) the Business Parks and Multi -Family Parcels, affected by the Golden Valley Road realignment, shall be replanned to mitigate the costs of these changes. 3. In order to avoid further loss of development permitted by the current Development Agreement resulting from the realignment of Santa Clarita Parkway and because it will no longer be needed as a material circulation element, Santa Clarita Parkway shall be eliminated or redesigned, provided any modification must be supported by an independent traffic study and subject to City processing and approval of a General Plan amendment. 4. Owner and the City shall facilitate timely construction of, and reimbursement for, the extension of Via Princessa east of Golden Valley Road to Rainbow Glen. 5. Parking areas on the Project in connection with the Commuter Rail Station Site shall be described in terms of an allocation of spaces rather than area of land. Mutual Benefits 1. The mechanism for fair share reimbursement by future off -Project developers of costs advanced and incurred by Owner for various traffic and other mitigation measures, the benefits of which extend beyond the Project, shall be clarified and set forth. 2. The City and Owner will support the formulation of plans to secure public and tax increment or tax exempt financing or other financial opportunities which will minimize City/Owner capital outlays and costs. 3. The City's Director of Planning and Building Services will be given authority to approve requested changes in specific plan entitlements which do not substantially change overall density, traffic, or other specified concerns. 3M59 3W-7 - 2 - 4. Given the environmental attributes of the Project, the City and Owner will agree to expedited and special review, process and approval, and where appropriate the issuance of: (a) all development submittals, (b) any required final tract maps, site plans, and architectural plans, and (c) the building and all other permits for improvements to or of the Project or any portion thereof for Owner, its successors and assigns. Conclusion Neither the City nor Owner intends this MOU to be a binding contract or to be bound by this MOU. No formal agreement will exist until such time as formal amendments to the Development Agreement, Conditions of Approval and Commuter Rail Station Site Lease (the "Amendments") have been approved and executed by the City and Owner. Upon execution of this MOU, the City and Owner will commence and process formal applications for the Amendments, each such party proceeding in good faith and with best efforts and abilities in conformity with the schedule attached hereto as Exhibit 2. It is the intent of both parties to reach mutual agreement on the express terms of the Amendments. Unless and until the Amendments are approved and executed, either the City or Owner may, at any time and for any reason, refuse to proceed with and withdraw from the negotiations. By executing this MOU, the City and Owner again wish to confirm the provisions of this MOU represent the basic and fundamental elements of the understanding of the City and Owner regarding the basis for their going forward with the processing and good faith negotiations of the Amendments. If the parties execute such Amendments, those Amendments will supersede this MOU. 30005943\V.7 - 3 -