HomeMy WebLinkAbout07-13 CC Ordinance
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ORDINANCE NO. 07-13
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY
OF TEMECULA APPROVING A DEVELOPMENT
AGREEMENT BETWEEN TEMECULA PROPERTIES,
LLC, PROFESSIONAL HOSPITAL SUPPLY, INC., AND
THE CITY OF TEMECULA FOR AN APPROXIMATE 84-
ACRE SITE GENERALLY LOCATED AT THE
NORTHWEST CORNER OF DENDY PARKWAY AND
WINCHESTER ROAD IN THE CITY OF TEMECULA (APN
909-370-018 AND 909-370-032) PLANNING APPLICATION
NO. PA07-0220
THE CITY COUNCil OF THE CITY OF TEMECULA DOES HEREBY ORDAIN
AS FOllOWS:
Section 1. Procedural Findinas. The City Council of the City of Temecula
finds and determines that:
A. On September 5, 2007, the Planning Commission recommended that the
City Council approve Planning Application No. PA07-0220, a Development Agreement
between Temecula Properties llC, Professional Hospital Supply, Inc, and the City of
Temecula for an 84-Acre site located at the northwest corner of Dendy Parkway and
Winchester Road as a Future Specific Plan Area (APN 909-370-018 and 909-370-032)
(the "Development Agreement").
B. The Development Agreement was processed in the time and manner
prescribed by State and local law.
C. On September 5, 2007, the Planning Commission held a duly noticed
public hearing as prescribed by law, at which time the City staff and interested persons
had an opportunity to and did testify either in support of or in opposition to the
Development Agreement.
D. At the conclusion of the Commission hearing and after due consideration
of the testimony, the Commission recommended that the City Council approve the
Development Agreement.
E. On September 25, 2007, the City Council held a duly noticed public
hearing on the Development Agreement as prescribed by law, at which time the City
staff and interested persons had an opportunity to and did testify either in support or in
opposition to the Development Agreement.
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F. On September 25, 2007 the City Council adopted Resolution No. 07-76
entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA
APPROVING A MITIGATED NEGATIVE DECLARATION FOR THE TEMECULA
PROPERTIES LLC/PROFESSIONAL HOSPITAL SUPPLY PROJECT ON AN 84-ACRE
SITE LOCATED AT THE NORTHWEST CORNER OF DENDY PARKWAY AND
WINCHESTER ROAD AS A FUTURE SPECIFIC PLAN AREA (APN 909-370-018 AND
909-370-032) WHICH CONSISTS OF PLANNING APPLICATIONS NO. PA07-0048, A
GENERAL PLAN AMENDMENT, PA07-0220 A DEVELOPMENT AGREEMENT; PA06-
0370, A TENTATIVE MAP, AND PA06-0369 AND PA07-0090, A DEVELOPMENT
PLAN WITH A MINOR EXCEPTION."
F. Following due consideration of the testimony received at the public
hearings and the administrative record, the City Council adopted this Ordinance.
G. All legal preconditions to the adoption of this Ordinance have occurred.
that:
Section 2. Further Findinas. The City Council hereby finds and determines
A. The Development Agreement is consistent with the objectives, policies,
general land uses, and programs specified in the City of Temecula General Plan and
each of its elements in that the Development Agreement makes reasonable provision
for the use of certain real property for industrial, commercial and residential
development.
B. The Development Agreement complies with the goals and objectives of
the Circulation Element of the General Plan, and the traffic impacts of the development
will be less than significant or substantially mitigated by the mitigation measures and
Conditions of Approval imposed.
C. The Project subject to the Development Agreement is compatible with the
uses authorized in, and the regulations prescribed for the zoning district in which the
property subject to the Development Agreement is located, and that this Development
Agreement is consistent with good planning practices by providing for the opportunity to
develop the property consistent with the General Plan.
D. The Development Agreement is in conformity with the public convenience,
general welfare, and good land use practice because it makes reasonable provision for
a balance of land uses compatible with the remainder of the City.
E. The Development Agreement will not be detrimental to and will promote
the health, safety, or general welfare of the community because it provides adequate
assurances for the protection thereof.
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F. The benefits that will accrue to the people of the City of Temecula from
this legislation and this Development Agreement are expansion of an important local
employer that could bring additional employment opportunities to local residents.
G. The potential significant impacts to the environment from the project will
be mitigated to a less than significant level based upon the identified mitigation
measures.
Section 3. Approval The City Council of the City of Temecula hereby
approves that certain agreement entitled "Development Agreement Temecula
Properties, LLC" by and between the City of Temecula, Temecula Properties LLC, and
Professional Hospital Supply, Inc. ("Development Agreement"), in substantially the form
attached hereto as Exhibit A, with such changes to the Development Agreement as may
be mutually agreed upon by Temecula Properties, LLC, Professional Hospital Supply
and the City Manager and which are in substantial conformance with the form of such
Development Agreement attached hereto. The Mayor is hereby authorized to execute
the Development Agreement, including related exhibits and attachments on behalf of
the City. A copy of the final Agreement when executed by the Mayor and the other
parties shall be placed on file in the Office of the City Clerk.
Section 4. Authoritv of Citv Manaaer. The City Manager (or his designee), is
hereby authorized, on behalf of the City, to take all actions necessary and appropriate to
carry out and implement the Development Agreement and to administer the City's
obligations, responsibilities and duties to be performed under the Development
Agreement, including but not limited to, approval and execution on behalf of the City of
acceptances, certificates, certificates of completion and such other implementing
agreements and documents as contemplated, necessary or described in the
Development Agreement.
Section 5. Certification. The City Clerk shall certify to the adoption of this
Ordinance. This Ordinance shall take effect upon its adoption.
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PASSED, APPROVED, AND ADOPTED by the City Council of the City of
Temecula this 9th day of October, 2007.
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C ' ck Washington, Mayor
ATTEST:
[SEAL]
STATE OF CALIFORNIA )
COUNTY OF RIVERSIDE ) ss
CITY OF TEMECULA )
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I, Susan W. Jones, MMC, City Clerk of the City of Temecula, do hereby certify that
the foregoing Ordinance No. 07-13 was duly introduced and placed upon its first reading
at a meeting of the City Council of the City of Temecula on the 25th day of September,
2007, and that thereafter, said Ordinance was duly adopted by the City Council of the City
of Temecula at a meeting thereof held on the 9th day of October, 2007, by the following
vote:
AYES: 5
COUNCIL MEMBERS:
Comerchero, Edwards, Naggar, Roberts,
Washington
NOES: 0
COUNCIL MEMBERS:
None
ABSENT: 0
COUNCIL MEMBERS:
COUNCIL MEMBERS:
None
ABSTAIN: 0
None
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W. Jones, MMC
City Clerk
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RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
City of Temecula
43200 Business Park Drive
P.O. box 9033
Temecula, California 92589-9033
Attn: City Clerk
Exempt from recording fees pursuant to GoV!. Code Section 27383
(Space above for recorder's use)
DEVELOPMENT AGREEMENT
TEMECULA PROPERTIES, LLC
THIS DEVELOPMENT AGREEMENT (the "Agreement") is entered into as of
[DATE], by and between the TEMECULA PROPERTIES, LLC, a California limited liability
company (hereinafter "OWNER"), PROFESSIONAL HOSPIT AL SUPPLY, INC., a California
corporation (hereinafter "PHS"), and the CITY OF TEMECULA, a municipal corporation,
organized and existing under the laws of the State of California (hereinafter "CITY"), pursuant
to the authority of Sections 65864 through 65869.5 of the California Government Code (the
"Development Agreement Legislation") and Article XI, Section 2 of the California Constitution.
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RECITALS
This Agreement is predicated upon the following facts:
A. These Recitals refer to and utilize terms that are separately defined by Section I
or by other Sections of this Agreement. It is the intent of the parties that these words shall have
the same meaning in these Recitals as they do in the Agreement.
B. The Development Agreement Legislation authorizes the CITY to enter into
binding development agreements with persons having legal or equitable interests in real property
for the development of such property for the following purposes:
plans;
I. Ensuring high quality development in accordance with comprehensive
2. Reducing uncertainty in the development approval process that might
otherwise result in a waste of resources, discourage investment, and escalate the cost of
development to the consumer;
3. Strengthening the CITY's comprehensive planning process to provide for
the most efficient use of public and private resources by encouraging private participation in the
comprehensive planning process;
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4. Assuring owners of land that upon approval, they may proceed with their
projects in accordance with defined policies, rules, regulations, and conditions of approval; and
5. Providing for the financing and/or construction of necessary public
facilities.
C. In addition to the general purposes stated above, the following are among the
considerations supporting this Agreement:
I. This Agreement authorizes OWNER to develop an approximately eighty-
four (84) acre property located within the CITY of Temecula, the County of Riverside, State of
California (the "Property"), described in Exhibit "A" with a potential mixture of industrial,
commercial retail, office, high density residential, and public institutional facility uses, as further
defined in this Agreement.
2. This Agreement will provide for both parties: (a) a high quality
development on the Property subject to this Agreement; (b) certainty in the type of development
to be undertaken on the Property; and (c) the assurance of adequate public facilities to ensure the
good of the community regardless of the CITY's legal authority to impose such requirements
under constitutional or statutory authority.
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3. For the CITY, this Agreement serves to provide for: (a) employment
growth anticipated to result from the Development of the Property, both during construction and
use; (b) an increase in tax revenues anticipated to result from the Development of the Property;
and (c) the achievement of the goals and directives of its General Plan.
4. The development of new commercial facilities and offices is an integral
part of OWNER's development plans for the Property. Such facilities are expected to bring
employment and generate sales tax revenue for the CITY.
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5. OWNER will co-operate in facilitating the Western By-Pass. The CITY is
planning for the design, financing, and construction of the Western By-Pass. At this time the
CITY contemplates, but has not approved, a financing mechanism, such as but not limited to an
assessment district or a community facilities district, by which the Western By~Pass will be
funded with Transportation Uniform Mitigation Fees ("TUMF") and grant funds and the
properties benefited by the Western By-Pass would pay their fair share of the costs not covered
by TUMF or grant funds with credits for appropriate TUMF contributions. OWNER obligations
under applicable law will require a substantial payment ofTUMF. Any provision of this
Agreement to the contrary notwithstanding, this Agreement does not impose any duty upon
OWNER to vote in favor of or join in the formation of a community facilities district or similar
entity for financing all or any part of the Western By-Pass. In the event of the formation of a
community facilities district or similar entity that includes the Property for financing all or any
part of the Western By-Pass, OWNER shall receive credits against its obligation to pay TUMF
and/or other fees and/or assessments related to transportation. In the event OWNER has
previously thereto paid TUMF fees and the Property becomes subject to the payment of special
assessments or similar impositions by virtue of being included in a community facilities district
or similar financing entity, then OWNER shall be entitled to a credit against any such special
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assessments and/or similar impositions in the amount ofthe said TUMF fees previously paid on
account of the Property.
D. OWNER desires to develop the Property in accordance with the provisions of this
Agreement, the Applicable Regulations, and those other agencies exercising jurisdiction over the
Property.
E. OWNER has applied for, and the CITY has approved, this Agreement in order to
create beneficial development of the Property and a physical environment that will conform to
and complement the CITY's goals, create development sensitive to human needs and values,
facilitate efficient traffic circulation, and otherwise provide for the development of the Property
in accordance with the best interests of the CITY.
F.
Project:
The following actions have been taken with respect to this Agreement and the
I. On September 4, 2007, following a duly noticed and conducted public
hearing, the CITY Planning Commission recommended that the CITY Council approve this
Agreement;
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2. On September 25, 2007 after a duly noticed public hearing and pursuant to
the California Environmental Quality Act of 1970, as amended, ("CEQA'') the CITY Council
adopted Resolution 2007-_ approving the Mitigated Negative Declaration for the Project
Approvals, this Agreement, and the Project;
3. On September 25, 2007, following a duly noticed public hearing, the City
Council introduced Ordinance No. 2007-_and on October 9, 2007 held the second reading
and adopted Ordinance No. 2007-_ approving this Agreement, a copy of which is on file in
the CITY Clerk's Office at the CITY, which ordinance includes the findings pertaining thereto,
including those relating to the CEQA documentation for the Project and this Agreement's
consistency with the CITY's General Plan and each element thereof and any specific plans
relating to the property.
4. On September 25, 2007, after a duly noticed public hearing, the City
Council adopted to following resolutions approving certain entitlements for the Project (the
"Project Approvals"): (1) Resolution No. 07-_ approving Planning Application No. PA07-
0048 General Plan Amendment; (2) Resolution No. 07-_ approving Planning Application
No. 06-370 Tentative Tract Map TTM 35181; (3) Resolution No. 07-_ approving Planning
Application No. P A06-0369 Development Plan; (4) Resolution No. 07-_ approving Planning
Application No. P A07-0090 Minor Exception.
G. The CITY has engaged in extensive studies and review of the potential impacts of
the Project as well as the various potential benefits to the CITY by the Development ofthe
Project and has concluded that the Project is in the best interests ofthe CITY.
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H. In consideration of the public improvements and beneficial uses of the Property to
be provided by OWNER for the CITY and in order to strengthen the planning process for this
Property and reduce the economic costs of development, by this Agreement, the CITY intends to
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give OWNER assurance that OWNER can proceed with the Development of the Property for the
Term of this Agreement pursuant to the terms and conditions of this Agreement and in
accordance with the Project Approvals and CITY's Applicable Regulations. In reliance on the
CITY's covenants in this Agreement concerning the Development of the Property, OWNER has
and will in the future incur substantial costs in site preparation and the construction and
installation of major infrastructure and facilities in order to make Development of the Property
feasible.
I. Pursuant to Section 65867.5 of the Development Agreement Legislation, the
CITY Council has found and determined that: (i) this Agreement implements the goals and
policies ofthe CITY's General Plan, provides balanced and diversified land uses, and imposes
appropriate standards and requirements with respect to land development and usage in order to
maintain the overall quality oflife and the environment within the CITY; (ii) this Agreement is
in the best interests of and not detrimental to the public health, safety and general welfare of the
CITY and its residents; (iii) adopting this Agreement is consistent with the CITY's General Plan,
and each element thereof and any applicable specific plan, and constitutes a present exercise of
the CITY's police power; and (iv) this Agreement is being entered into pursuant to and in
compliance with the requirements of Government Code Section 65867 of the Development
Agreement Legislation.
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J. OWNER and Professional Hospital Supply, Inc. ("PHS") have entered into an
agreement providing for the lease of the PHS Property to PHS (as defined in Section 1.14) along
with an option for PHS to purchase the PHS Property from OWNER for the development of the
PHS Facility. A memorandum of this agreement is recorded in the Riverside County Recorder's
Office as Document No. 2007-
AGREEMENT
NOW, THEREFORE, pursuant to the authority contained in the Development
Agreement Legislation, as it applies to the CITY, pursuant to Article XI, Section 2 of the
California Constitution, and in consideration of the foregoing recitals of fact, all of which are
expressly incorporated into this Agreement, the mutuai covenants set forth in this Agreement and
for the further consideration described in this Agreement, the parties agree as follows:
I. Definitions. The following words and phrases are used as defined terms
throughout this Agreement and each defined term shall have the meaning set forth below.
1.1. Authorizing Ordinance.
No. 2007-_ adopted by the CITY on
Agreement.
The "Authorizing Ordinance" means Ordinance
, 2007 approving this
1.2. Applicable Regulations. The phrase "Applicable Regulations" is defined
in Section 3.1.2 below.
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1.3. CITY. The "CITY" means the City of Temecula, a Califomia municipal
corporation, duly organized and existing under the Constitution and laws of the State of
California, and all of its officials, employees, agencies and departments.
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1.4. CITY Council. "CITY Council" means the duly elected and constituted
CITY Council of the CITY..
1.5. Development. "Development" means the improvement of the Property for
purposes consistent with this Agreement, including, without limitation: grading, the construction
of infrastructure and public facilities related to the Off-Site Improvements and on-site
improvements, the construction of structures and buildings and the installation of landscaping.
1.6. Development Al!J'eement Legislation. The "Development Agreement
Legislation" means Sections 65864 through 65869.5 ofthe California Government Code as it
exists on the Effective Date.
I. 7. Effective Date. "Effective Date" means the date that the Agreement
becomes effective in accordance with Section 2.3.1, below.
1.8. Future DevciIopment Approvals. "Future Development Approvals" means
those entitlements and approvals contemplated, necessary, and requested by the CITY or
OWNER to cause development to occur upon the Property after the Effective Date.
1.9. Off-Site Improvements. "Off-Site rIDprovements" means the
improvements set forth on Exhibit B.
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1.10. OWNER. "OWNER" shall mean TEMECULA PROPERTIES, LLC, a
California limited liability company, and all successors in interest, in whole or part, to this entity
with respect to that portion of the Property other than the PHS Property, and PROFESSIONAL
HOSPITAL SUPPLY, INC. and all successors in interest, in whole or part, to this entity with
respect to the PHS Property.
1.11. Intentionallv Omitted
1.12. PHS "PHS" shall mean Professional Hospital Supply, Inc.
1.13 PHS-Related Transferee "PHS-Related Transferee" shall mean an
affiliated entity of PHS nominated to hold the PHS Property for the use and development of the
business of PHS.
1.14. PHS Property. "PHS Property" shall mean the approximately 36.96 acres
of the Property which OWNER has leased to PHS with an option to purchase and which is
further described and depicted on Exhibit C, and more particularly described as Lot 4 of
Tentative Tract Map No. 35181.
1.15. Proiect. "Project" shall mean Development of the Property for industrial,
commercial, retail, offices, high-density residential and public institutional facility uses in
accordance with the Project Approvals and this Agreement, inclusive ofthe permitted uses ~d
regulations set forth herein.
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1.16. Project Approvals. The phrase "Project Approvals" as used herein shall
mean all City approvals, entitlements, or both pertaining to the Project, including without
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limitation, the following resolutions approving certain entitlements for the Project: (I)
Resolution No. 07-_ approving Planning Application No. P A07 -0048 General Plan
Amendment; (2) Resolution No. 07-_ approving Planning Application No. 06-370 Tentative
Tract Map TIM 35181; (3) Resolution No. 07-_ approving Planning Application No. PA06-
0369 Development Plan; (4) Resolution No. 07-_ approving Planning Application No. PA07-
0090 Minor Exception.. The Parties will cooperate in good faith in the adoption of a Planned
Development Ordinance if and when the OWNER applies for the same.
Exhibit A.
1.17. Propertv. "Property" shall mean the property depicted and described in
1.18. Public Improvements. "Public Improvements" shall mean the Off-Site
Improvements described on Exhibit B.
1.19. Transferee. The person to whom the OWNER sells, assigns or otherwise
transfers all or any portion of OWNER's interests in the Property together with all its right, title
and interest in this Agreement in accordance with Section 2.5 of this Agreement.
Exhibit E.
1.20. Western By-Pass. "Western By-Pass" shall mean that road described on
2. General Provisions.
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2.1. Binding Covenants. The provisions of this Agreement, to the extent
permitted by law, constitute covenants that shall run with the Property for the benefit thereof,
and the benefits and burdens of this Agreement shall bind and inure to the benefit of the parties
and all successors in interest to the parties hereto.
2.2. Interest of OWNER. OWNER represents that OWNER has a legal or
equitable interest in the Property that satisfies California Government Code Section 65865(b).
2.3. Term. This Agreement shall become effective on the Effective Date, and
shall have a term (the "Term") often (10) consecutive calendar years, commencing upon the
issuance by the CITY of a Certificate of Occupancy for the building to be constructed on the
PHS Property, subject to specific extensions, revisions, and termination provisions of this
Agreement. When the Term has been determined, the parties shall execute and record an
Operating Memorandum pursuant to Section 2.6.4 ofthe Agreement that will confirm the Term.
The termination of this Agreement pursuant to this Section shall not affect any right or duty
arising independently from entitlements issued by the CITY or other land use approvals
approved prior to, concurrently or subsequent to the approval of this Agreement, except as may
be provided in this Agreement. The zoning of the Property at the time of termination pursuant to
this Section shall be the zoning in effect at the time oftermination.
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2.3.1 Effective Date. This Agreement shall become effective only after
both: (I) the Authorizing Ordinance becomes effective; and (2) the OWNER either sells the PHS
Property to PHS or leases the PHS Property to PHS for a term of not less than eight years. The
Effective Date shall be the date on which the later of these two events occurs. When the parties
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determine the Effective Date, they shall execute and record an Operating Memorandum pursuant
to Section 2.6.4 of the Agreement confinning the Effective Date.
2.4. Termination. This Agreement may be terminated by either party upon
notice to the other upon the occurrence of any of the following events: (I) if termination occurs
pursuant to any specific provision of this Agreement; or (2) entry after all appeals have been
exhausted of a final judgment or issuance of a final order directed to the CITY as a result of any
lawsuit filed against the CITY to set aside, withdraw, or abrogate the approval of the CITY
Council of this Agreement for any part of the Project. The termination of this Agreement
pursuant to this Section shall not affect any right or duty arising independently from entitlements
issued by the CITY or other land use approvals approved prior to, concurrently or subsequent to
the approval of this Agreement, except as may be provided in this Agreement. The zoning of the
Property at the time oftermination pursuant to this Section shall be the zoning in effect at the
time of termination.
2.5. Transfers and Assignments.
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2.5.1. Restrictions on Transfers. With the exception of the sale or lease
of the PHS Property to PHS required for this Agreement to go into effect, OWNER shall not sell,
assign, or otherwise transfer all or any portion of its interests in the Property together with all its
right, title and interest in this Agreement, or the portion thereof which is subject to the
transferred portion of the Property, to any Transferee until such time as the Public Improvements
have been accepted by the CITY Council unless the CITY has approved the transfer prior to its
completion. CITY shall not unreasonably withhold or unreasonably delay consent to the transfer
provided that: (1) the Transferee has specifically assumed in writing the obligations, or a portion
of the obligations of the OWNER, to design, construct, install and finally complete the Public
Improvements for the Property; (2) the Transferee has the experience and financial capacity to
complete the Public Improvements; and (3) the Transferee has obtained replacement bonds,
accepted by the CITY for the Public Improvements (in which event, the City shall release the
OWNER's corresponding Public Improvement bonds). In the event of any sale, assigrunent, or
other transfer pursuant to this Section 2.5, (i) OWNER shall notify the CITY within twenty (20)
days prior to the transfer of the name of the Transferee, together with the corresponding
entitlements being transferred to such Transferee and (ii) the agreement between OWNER and
Transferee pertaining to such transfer shall provide that the Transferee shall be liable for the
performance of those obligations of OWNER under this Agreement which relate to the
Transferred Property, if any, or shall confirm that the OWNER and all Transferees shall remain
jointly liable for the design and construction of Public Improvements pursuant to this Agreement.
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2.5.2. Rights and Duties of Successors and Assigns. Any, each and all
successors and assigns of OWNER shall have all of the same rights, benefits, duties and
obligations of OWNER under this Agreement. All entities holding title to a portion of the
Property shall be jointly liable for the design and construction of the Public Improvements for
that portion of the Property as set forth in this Agreement, except as provided in this Agreement
or as may be modified in an Operating Memorandum pursuant to Section 2.6.4. Notwithstanding
this Section or any other provisions of this agreement, no Transferee of the PHS Property shall
be responsible for the design or construction of any Public Improvements (or any portion
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thereof) except those that bear a direct relationship, i.e., "nexus" to the Development ofthe PHS
Property.
2.6. Amendment of Develooment Agreement.
2.6.1. Initiation of Amendment. Any party may propose an amendment
to this Agreement and both parties agree that it may be beneficial to enter into additional
agreements or modifications of this Agreement in connection with the implementation of the
separate components of the Project.
2.6.2. Procedure. Except as set forth in Section 2.6.4 below, the
procedure for proposing and adopting an amendment to this Agreement shall be the same as the
procedure required for entering into this Agreement in the first instance.
2.6.3. Consent. Except as expressly provided in this Agreement, any
amendment to this Agreement shall require the written consent of both parties. No amendment
to all or any provision of this Agreement shall be effective unless set forth in writing and signed
by duly authorized representatives of each of the parties.
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2.6.4. Ooeraling Memoranda. The parties acknowledge that refmements
and further Development of the Project may demonstrate that changes are appropriate with
respect to the details and performance of the parties under this Agreement. The parties desire to
retain a certain degree of flexibility with respect to those items covered in general terms under
this Agreement. If and when the parties mutually find that changes, adjustments, or
clarifications are appropriate to further the intended purposes of this Agreement, they may,
unless otherwise required by law, effectuate such changes, adjustments, or clarifications without
amendment to this Agreement through one or more operating memoranda mutually approved by
the parties, which, after execution, shall be attached hereto as addenda and become a part hereof
and may be further changed and amended from time to time as necessary, with further approval
on behalf of the CITY by the CITY Manager, or such person designated in writing by the CITY
Manager, and by any corporate officer or other person designated for such purpose in a writing
signed by a corporate officer on behalf of OWNER. Unless otherwise required by law or by this
Agreement, no such changes, adjustments, or clarifications shall require prior notice or hearing,
public or otherwise.
2.7. Term ofMao(s) and Other Project Aoorovals. Pursuant to California
Government Code Sections 66452.6(a) and 65863.9, the term of any subdivision or parcel map
that has been or in the future may be processed for all or any portion of the Property and the term
of each of the Project Approvals shall be deemed extended without further required action for a
period oftime through the scheduled termination date of this Agreement as set forth in Section
2.3 above if such map or Project Approval would otherwise have expired prior thereto.
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2.8. Amendments to Project Aoorovals. It is contemplated by CITY and
OWNER that OWNER may, from time to time, seek amendments to one or more of the Project
Approvals. Any such amendments are contemplated by CITY and OWNER as being within the
scope of this Agreement as long as they are consistent with the Applicable Regulations and shall,
upon approval by CITY, continue to constitute the Project Approvals as referenced herein. The
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parties agree that any such amendments shall not constitute an amendment to this Agreement nor
require an amendment to this Agreement.
2.9. Infrastructure Phasing Flexibilitv. Notwithstanding the provisions of any
phasing requirements in the Project Approvals, OWNER and CITY recognize that economic and
market conditions may necessitate changing the order in which the infrastructure is constructed
so long as the modification continues to ensure adequate infrastructure is available to serve that
portion of the Project being developed. Therefore, CITY and OWNER hereby agree that should
it become necessary or desirable to develop any portion of the Project's infrastructure in an order
that differs from the order set forth in the Project Approvals, OWNER and CITY shall
collaborate in a good faith effort to agree upon any reasonable modification requested by
OWNER provided, however, that any modification to the order of construction of the
infrastructure as provided in this Agreement and the Proj ect Approvals shall be approved by the
OWNER and CITY in an Operating Memorandum.
3. Develooment of the Prooertv.
3.1. Develooment and Control ofDevelooment.
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3.1.1. ControlofDevelooment. While this Agreement is in effect,
OWNER shall have the vested right to develop the Property pursuant to and in accordance with
the Applicable Regulations pursuant to this Agreement, including, without limitation, specific
uses, densities, and types of Development provided for in the Applicable Regulations, and the
CITY shall have the right to control the Development in accordance with the terms and
conditions of this Agreement, the Project Approvals and all Applicable Regulations. Except as
otherwise specified in the Project Approvals and this Agreement, the Applicable Regulations
shall control the design and Development, Future Development Approvals and all Off-Site
Improvements and appurtenances in connection therewith. The Applicable Regulations are only
those written rules, policies, ordinances, and resolutions described in Section 3.1.2.1 below.
OWNER and CITY shall use reasonable efforts to compile the Applicable Regulations in a
permanent written form, which shall be kept on file in the Office of the CITY Clerk with a copy
. to each party.
3.1.2. Aoolicable Regulations. The regulations applicable to the
Development of the Property shall consist of the following requirements ("Applicable
Regulations'').
3.1.2.1. General Develooment Regulations. Except as
otherwise specified in this Agreement, the ordinances, rules, regulations and official policies
governing the permitted uses of the Property, including but not limited to the permitted density
and intensity of use, provisions for reservation or dedication of land for public purposes, and the
design, improvement, and construction standards and specifications applicable to Development
of the Property shall be those ordinances rules, regulations, and official policies as they exist on
the Effective Date.
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3.1.2.2. Uses. OWNER shall develop the Property for
industrial, commercial, retail, high-density residential, and public institutional facility uses, in
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accordance with the specific matrix of permitted uses set forth in Exhibit "F" attached hereto.
No other uses shall be allowed on the Property unless otherwise authorized by this Agreement,
the Project Approvals, or the Applicable Regulations.
3.1.2.3. Multi-Family Parcel Affordable Housing. The
following affordable housing requirements shall be applicable to the "Multi-Family Parcel" (as
designated hereinafter):
I. Multi-Family Parcel. Any multi-family residential uses on the 12
acre parcel on the east side of the Property, as described on Exhibit F ("Multi-
family Parcel''), shall include an affordable housing component in accordance
with this Section.
2. For Sale/For Rent - Moderate Income ReQuirements. Not less
than twenty percent (20%) of the units developed in each phase of Development
of the Multi-family Parcel shall be restricted for sale at Affordable Housing Cost
to Persons or Families of Moderate Income or for rent to Persons or Families of
Moderate Income at Affordable Rent.
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3. Term of Mfordable Housing ReQuirements. The affordable
housing requirements for each unit on the Multi-family Parcel shall be in effect
for a period of not less than fifty-five (55) years from the date of the certificate of
occupancy for the unit.
4. Regulatorv Al!l'eement. The restrictions set forth in this Section as
well as the means to implement this Section, including, but not limited to,
designation of the affordable housing units, marketing and outreach procedures,
procedures for verifying qualified buyers or renters, restrictions on subsequent
sales and rentals, lender consent and subordination, and other necessary
implementation provisions shall be set forth in a Regulatory Agreement approved
by the CITY and OWNER and which Regulatory Agreement shall be recorded
prior to the issuance of the first building permit for the Multi-family Parcel.
5. Definitions. "Persons or Families of Moderate Income" shall be
defined for the purposes of this Agreement as such term is defined in Section
50093 of the California Health and Safety Code or its successor statute.
"Affordable Housing Cost" shall be defined for the purposes of this Development
Agreement as such term is defined in Section 50052.5 of the California Health
and Safety Code or its successor statute. "Affordable Rent" shall be defined for
the purposes of this Agreement as such term is defined in Section 50053 of the
California Health and Safety Code or its successor statute.
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3.1.2.4. Uniform Building Codes. Development of the
Property shall be subject to such uniform building codes and fire codes as may be adopted by the
CITY pursuant to Chapter 15.04 and 15.16 of the Temecula Muuicipal Code, in effect as of the
date the building plans are submitted to the CITY for plan check and approval of the building
permit.
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3.1.2.5 Floor Area Ratio for PHS Property The Floor Area
Ratio for the PHS Property shall not exceed forty- five percent (45%). This Section 3.1.2.5 shall
be effective only upon the close of escrow of a sale or lease of the PHS Property to PHS or a
PHS-Related Transferee. If the PHS Property is not sold or leased to PHS or a PHS-Related
Transferee, then the provisions of the Temecula Municipal Code on the effective date of this
Agreement pertaining to floor area ratios shall govern the PHS Property
3.1.2.6. Final Map Approval OWNER agrees the CITY
shall not be required to approve the Final Map for Tentative Map No. 35181 in the event that the
OWNER fails to meet or perform any or all of the material requirements of this Agreement
pertaining to the physical development of the Property.
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Limitation on PHS Property Vested Rights
The parties agree that the public benefits of this Agreement to the CITY which enhance the
public health, safety and welfare are dependent on a successful conveyance of the PHS Property
to PHS or a PHS-Related Transferee for the development and operation of a facility for PHS's
business. The parties further agree that it is the particular uses of the PHS Property as a facility
for PHS's business that justifies the modifications to current zoning and subdivision standards
for the PHS Property as provided in this Agreement. Therefore, the parties agree that the rights
to develop the PHS Property in accordance with the requirements for Lot 4 of Tentative Tract
Map No. 35181 shall become vested rights under this Agreement only upon and conditioned
upon the closing of the sale or lease of the PHS Property to PHS or a PHS-Related Transferee for
the development of PHS's Temecula Facility as described in the Deferral Agreement. In the
event the OWNER seeks to develop the PHS Property for a user other than PHS's Temecula
Facility, the CITY shall have the right to condition the Future Development Approvals for the
non-PHS development with such conditions related to slopes and access points as the CITY
deems appropriate even if such conditions may be inconsistent with the slopes and access points
for the PHS Property as shown on that portion of Tentative Map No. 35181 designated as Lot 4.
3.1.2.7
3.1.2.8. Subseouent Aoorovals. In connection with any
Future Development Approval or action which the CITY is permitted or has the right to make
under this Agreement relating to the Project, the CITY shall exercise its discretion or take action
in a manner which complies and is consistent with this Agreement and such other standards,
terms and conditions contained in this Agreement. Upon CITY's granting any Future
Development Approval, such Future Development Approval shall become part of the Project
Approvals.
3.1.2.9 Development Phasilll!..No building permits shall be
issued for the that portion of the Property other than the PHS Property until such time as a
building permit has been issued for the facilities to be constructed on the PHS Property pursuant
to the Project Approvals.
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3.1.3. Impact Fees.
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3.1.3.1. Development Impact Fees. The presently adopted
Development Impact Fees ("DIP"), as defined in Chapter 15.04 of the Temecula Municipal
Code, and the rates of the DIP as set forth in Resolution No. 03-63, shall be the DIP and DIF
rates to be imposed upon parcels within the Property for the entire Term during which this
Agreement is in effect and shall be those rates in effect on the Effective Date. Resolution No.
03-63 is attached hereto as Exhibit G, and is hereby incorporated by reference. The DIP and the
DIP rates shall apply only to the CITY's development impact fees and not to the TUMF, any
similarly regional impact fees described in Section 3.1.3.2 of this Agreement or to any other
development impact fees imposed by another governmental agency not under the control,
directly or indirectly, of the CITY. OWNER shall be entitled to such credits as might be
available pursuant to the terms of Chapter 15.04 or other provisions of the Applicable
Regulations and this Agreement.
3.1.3.1.I All persons or entities holding title or
interest in any portion of the Property, including any, each, and all successors and assigns of
OWNER shall be separately responsible for payment of any and all DIP for that portion of the
property developed by such person or entity. Notwithstanding this Section or any other
provision of this Agreement, the OWNER and any PHS-related Transferee of the PHS Property
shall not be required to pay DIP related to the Development of the PHS Property, it being agreed
that the payment ofDIF in connection with the Development of the PHS Property by PHS shall
be subject to the Deferral Agreement between the CITY and PHS and described in Section 3.1.6
of this Agreement.
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3.1.3.2. TUMF Fees. The presently adopted Transportation
Uniform Mitigation Fee, as defined in Chapter 15.08 of the Temecula Municipal Code, any
future similar regional development impact fee, or any other development impact fees imposed
by another governmental agency shall be imposed upon Development within the Property at the
rate in effect as of the date of issuance of each building permit for the Property. OWNER shall
be entitled to such credits as might be available pursuant to the terms of Chapter 15.08 or the
terms ofthe future allowable fees. Notwithstanding this Section 3.1.3.2, any regional
development impact fee that CITY has the discretion to adopt or not adopt, similar to the TUMF
or other existing regional fees, shall, if adopted by CITY, not be applicable to the OWNER or the
Property.
3.1.3.3. Application/Processing Fees. OWNER shall pay
the application and processing fees customarily imposed on the type of entitlement and/or permit
sought at the rate, and in the amount, imposed by CITY pursuant to the fee schedule, resolution
or ordinance in effect at the time the application is deemed complete and accepted by CITY for
action, which fees are designed to reimburse CITY's expenses attributable to processing such
applications for entitlements, permits, or both.
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3.1.4. Timing of Development. Except as set forth in Agreement,
regardless of any future enactment, by initiative, or otherwise, OWNER shall have the discretion
to develop the Property in one phase or in multiple phases at such times as OWNER deems
appropriate within the exercise of its subjective business judgment. Specifically, the CITY
agrees that OWNER shall be entitled to apply for and receive permits, maps, occupancy
certificates, and other entitlements to develop and use the Property at any time, provided that
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such application is made in accordance with this Agreement and the Applicable Regulations.
The parties hereto expressly reject the holding of Pardee Construction Company v. City of
Camarillo, 37 Cal. 3d 465 (1984), as regards any authority regulating the phasing of
Development and construction on the Property.
3.1.5. Permits and Approvals - Cooperation. CITY further agrees to
reasonably cooperate with OWNER, at no cost to CITY, in securing any County, State and
Federal permits or authorizations which may be required in connection with Development
contemplated by OWNER, including without limitation such permits, approvals, and/or consents
required by the MSHCP, as more fully set forth in Section 4.1.11, below. This cooperation shall
not entail any economic contribution by the CITY. The CITY will process all land use
applications, plans, maps, CEQA documents (to the extent required), permits, construction
inspection and related documents expeditiously; provided, however, the CITY will not charge
additional fees relating to such expeditious processing. Without limiting the foregoing, the
parties agree to use their respective good faith efforts to substantially conform to the processing
and approval schedule attached as Exhibit "H".
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3.1.6. Concurrently with the approval of this Agreement, CITY and PHS
entered into an Operating Covenant Agreement (the "Deferral Agreement''). CITY hereby
recognizes that OWNER is the same party as identified as "Developer" in the Deferral
Agreement and that OWNER is deemed by CITY to be a third party beneficiary of the Deferral
Agreement to the extent the Deferral pertains to the Developer. Article 1.15 of the Deferral
Agreement defines "Fee Waiver" as "a credit or reimbursement, as applicable, from the City to
PHS or the Developer, as applicable, in the amount of Two Million Dollars ($2,000,000) towards
any City fees or costs payable or reimbursable by the Developer or PHS, as applicable, including
any development impact, plan check, application, environmental review, permit or similar fees
and costs, regarding development of the Temecula Facility. The projected fees and amounts that
will be waived by the City are set forth in Exhibit' A' attached to this [Deferral] Agreement."
Without limiting the generality of the foregoing, the parties expressly incorporate herein the
provisions of Article 4.1 of the Deferral Agreement which provide "Following the Effective
Date, on each date on which any City fees or reimbursable costs are payable by the Developer or
PHS regarding development of the Temecula Facility, in consideration for PHS' performance of
its obligations pursuant to this Agreement, the City shall credit such amount to the Developer or
PHS, as applicable, until the full amount of the Fee Waiver has been credited. Ifthe Developer
or PHS pays any City fees or reimburses any City costs regarding development of the Temecula
Facility prior to the Effective Date, the City shall reimburse the amount of any such payment in
full to the Developer or PHS, as applicable, within fifteen (15) days following the Effective Date,
and any amount so reimbursed shall be counted towards the total amount of the Fee Waiver."
3.2. Reserved Authority.
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3.2.1. State and Federal Laws and Regulations. In the event that State or
Federal laws or regulations prevent or preclude compliance with one or more of the provisions of
this Agreement, such provisions of this Agreement shall be modified or suspended as may be
necessary to comply with such State or Federal laws or regulations; provided, however, that this
Agreement shall remain in full force and effect to the extent it is not inconsistent with such laws
or regulations and to the extent such laws or regulations do not render such remaining provisions
946783.6 Final 9118/07
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impractical to enforce. Notwithstanding the foregoing, the CITY shall not adopt or undertake
any regulation, program or action, or fail to take any action which is inconsistent or in conflict
with this Agreement until the CITY makes a finding that such regulation, program action or
inaction is required (as opposed to permitted) to comply with such State and Federal laws or
regulations after taking into consideration all reasonable alternatives.
3.2.2. Regulation for Health and Safetv. Notwithstanding anything to the
contrary in this Agreement, the CITY shall have the right to apply the CITY regulations
(including amendments to the Applicable Regulations) adopted by the CITY after the Effective
Date, in connection with any Future Development Approvals, or deny, or impose conditions of
approval on any Future Development Approvals if CITY determines that the failure of CITY to
make such application or to deny, or impose conditions of approval on any future Development
Approvals would place the residents or occupants of the Property or the residents of the CITY,
or both, in a condition dangerous to their safety, health, or both.
3.3. Vested Rights. By entering into this Agreement and relying thereon,
OWNER is obtaining the vested rights to proceed with the Development of the Property in
accordance with the terms and conditions of this Agreement. By entering into this Agreement
and relying thereon, the CITY is securing certain public benefits which enhance the public
health, safety and welfare, a partial listing of which benefits is set forth in Recital C above.
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3.4. No Conflicting Enactments. Except as otherwise provided by this
Agreement, neither the CITY Council nor any other agency of the CITY shall enact a rule,
regulation, ordinance, or other measure (collectively "law'') applicable to the Property that is
inconsistent or conflicts with the terms of this Agreement. By way of example, any law, whether
by specific reference to this Agreement or otherwise, shall be considered to conflict if it limits or
reduces the density or intensity of Development as regulated by the Applicable Regulations and
Project Approvals or otherwise requires any reduction or increase in the number, size, or square
footage oflot(s), structures, buildings, or other improvements, except as provided in Section 3.2.
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3.4.1. Moratorium. It is the intent of OWNER and the CITY that no
moratorium or other limitation (whether relating to the Development of all or any part of the
Project and whether enacted by initiative or otherwise) affecting parcel or subdivision maps
(whether tentative, vesting tentative, or final), site development permits, precise plans, site
development plans, building permits, occupancy certificates, or other entitlements to use
approved, issued, or granted within the CITY, or portions of the CITY, shall apply to the Project
to the extent such moratorium or other limitation would restrict OWNER's right to develop the
Property as provided by this Agreement in such order and at such rate as OWNER deems
appropriate as limited or regulated by this Agreement. The CITY agrees to reasonably cooperate
with OWNER in order to keep this Agreement in full force and effect. In the event of any legal
action instituted by a third party or other governmental entity or official challenging the validity
of any provision of this Agreement, the parties hereby agree to reasonably cooperate in
defending such action. In the event of any litigation challenging the effectiveness of this
Agreement, or any portion hereof, this Agreement shall remain in full force and effect while such
litigation, including any appellate review, is pending. The filing of any third party lawsuit(s)
against CITY or OWNER relating to this Agreement, the Project Approvals or to other
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development issues affecting the Property shall not delay or stop the Development, processing,
or construction of the Project, unless the third party obtains a court order preventing the activity.
3.4.2. Consistency Between this Al1l'eement and Current Laws. The
CITY represents that at the Effective Date there are no rules, regulations, ordinances, policies, or
other measures of the CITY in force that would interfere with the Development and use of all or
any part of the Property according this Agreement. In the event of any inconsistency between
any Applicable Regulation, Project Approval, and this Agreement, the provisions ofthis
Agreement shall control.
3.5. Reimbursement. Nothing in this Agreement shall preclude CITY and
OWNER from entering into any reimbursement agreements for the portion (if any) of the cost of
any dedications, public facilities, infrastructure, or any of these that CITY may require as
conditions of the Project Approvals, to the extent that they are in excess of those reasonably
necessary to mitigate the impacts of the Project.
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3.6. Acauisition ofRililit ofWav for Off-Site Improvements. To the extent the
OWNER does not have sufficient title or interest in the real property required for the
construction or installation of an Off-Site Improvement, the OWNER shall make a good faith
effort to acquire the required property in a timeframe calculated to allow for the orderly
Development of the Project. If, following this effort, the OWNER is unable to acquire the
required property; the OWNER may request that the CITY acquire the property pursuant to the
provisions ofGovemment Code Section 66462.5. The CITY shall consider in good faith the
acquisition of the required property pursuant to an agreement in accordance with the provisions
of Government Code Section 66462.5. Both parties acknowledge and agree that the acquisition
of real property in accordance with the California Eminent Domain Law requires more time than
the suggested time frames of Government Code Section 66462.5 allow and therefore, the parties
waive these time constraints and the Agreement shall so provide. The parties further
acknowledge and agree that the CITY cannot exercise its power of eminent domain unless and
until a Resolution of Necessity has been duly adopted by the CITY Council pursuant to law.
This Agreement is neither a commitment nor an announcement of an intent by the CITY to
acquire any or all of the property required for the Off-Site Improvements.
3.7. Easements. In the event a Proj ect Approval requires an easement to be
dedicated for pedestrian use, such an easement shall be permitted to include easements for
underground drainage, water, sewer, gas, electricity, telephone, cable, and other utilities and
facilities so long as they do not unreasonably interfere with pedestrian use.
4. Obligations of the Parties.
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4.1. Western By-Pass. The parties agree that the public benefits of this
Agreement to the CITY which enhance the public health, safety and welfare are dependent on a
successful conveyance ofthe PHS Property to PHS for the development and opemtion of a
facility for PHS's business. The parties further agree that it is the particular uses of the PHS
Property asa facility for PHS's business that justifies the modifications to current standards and
funding options for the Western Bypass as provided in this Agreement for the Property and for
the PHS Property. Therefore, the parties agree that the provisions of Section 4.1 of this
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Agreement shall be effective only upon and conditioned upon the closing ofthe sale or lease of
the PHS Property to PHS or a PHS-Related Transferee for the development of PHS's Temecula
Facility as described in the Deferral Agreement.
4.1.1. Status of Western Bv-Pass. The CITY is planning for the design,
financing, and construction of the Western By-Pass. At this time the CITY contemplates, but has
not approved, a financing mechanism, such as but not limited to an assessment district or a
community facilities district, by which the Western By-Pass will be funded with TUMF and
grant funds and in which the properties benefited by the Western By-Pass would pay their fair
share of the costs not covered by TUMF or grant funds with credits for appropriate TUMF
contributions. Any provision of this Agreement to the contrary notwithstanding, no provision of
this Agreement obligates OWNER, with respect to the Property, or PHS with respect to the PHS
Property to vote in favor of or join in the formation of a community facilities district or similar
entity for financing all or any part of the Western By-Pass.
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4.] .2. Consent to Westem Bv-Pass Financing Mechanism. Neither
OWNER, with respect to the Property, nor PHS, with respect to the PHS Property, shall be
required by this Agreement to consent to the establishment of a future financing mechanism,
such as, without limitation, an assessment district or community facilities district, for the
purposes of spreading the costs of financing construction of the Western By-Pass among those
property owners who will benefit from its construction. Nothing in this Agreement, however,
precludes the CITY or a related entity from initiating proceedings to form such a future fmancing
mechanism in accordance with applicable law.
4.].3. Participation in Western Bv-Pass Financing Mechanism. Neither
OWNER, with respect to the Property, nor PHS, with respect to the PHS Property, shall be
required by this Agreement to participate in the future financing mechanism for the Western By-
Pass except as may be required by law (and not by virtue of this Agreement). OWNER, with
respect to the Property, and PHS, with respect to the PHS Property, may, however, elect to
participate in the future financing mechanism for the Westem By-Pass. Nothing in this
Agreement, however, precludes the CITY or a related entity from initiating proceedings to form
such a future financing mechanism in accordance with applicable law.
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4.1.4. Construction of Western Bv-Pass as a Condition to Development.
Except as provided in Section 4.1.5, CITY shall not require that actual construction of the
Western By-Pass, or a portion thereof, be a condition precedent, a condition concurrent or a
condition subsequent to Future Development Approvals for the Property or the PHS Property. If
the City or other governmental agency designs and construct the Western By-Pass, the City or
such other agency shall be responsible for all costs associated with the Western By-Pass
including without limitation, roads, utilities, slopes, grading, retaining walls, and landscaping.
The CITY shall be responsible for all slopes, grading and retaining walls required to construct
the Western By-Pass as shown on Exhibit E. The OWNER shall be responsible for all grading,
slopes, and retaining walls required to construct Parcel 2, as shown on Exhibit E. The Owner
shall have the right to grade and develop Parcel 2 prior to construction ofthe Western By-Pass as
approved in Tentative Map No. 35181, as shown on ExhibitM, provided that the development of
Parcel 2 does not inhibit construction or potentially place additional costs upon the CITY or
other governmental entity for the future development of the Westem Bypass.
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4.1.5. Westem By-Pass Connector Roads; On and OffRamDs. Provided
the Western By-Pass is actually constructed, OWNER shall, at its own expense, design, secure
rights of way, obtain all applicable governmental approvals and construct any approved
connector roads or on or off ramps and related improvements from the Property to the Western
By-Pass. CITY will use its good faith in evaluating and considering approval of a reasonable
request by OWNER of any connector roads or on or off ramps from the Property to the Western
By-Pass. Connector road construction costs shall include, without limitation, rights-of-way,
roads, utilities, slopes, grading, and retaining walls associated with such connector roads or on or
off ramps.
4.1.6. TUMF Credits and Reimbursements. In the event that OWNER
desires to construct a portion of the Western By-Pass for access to the Property, any connector
roads or on or off ramps, OWNER may apply for TUMF reimbursements or credits in
accordance with the credit and reimbursement provisions of Chapter 15.08 of the Temecula
Municipal Code pertaining to TUMF for any such portions of the Western By-Pass. In agreeing
to this provision, OWNER acknowledges and agrees that CITY can provide no assurances that
such constructs are now or will be in the future eligible for TUMF credits or reimbursements.
4.1.7. Reming;ton Road Extension. OWNER shall be responsible for all
costs associated with the construction of the Reming;ton Road extension, the connection to the
Western By-Pass and the installation of access points from the Property to Remington Road; in
substantial conformity with the plans depicted in Exhibit I (phase II Streets).
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4.1.8. Access Points/Commercial Deliveries. For clarity of
understanding, the parties acknowledges that access points i) along Remington Road; ii)
pertaining to the future access of the extension of Remington Road to the Western By-Pass; iii)
pertaining to Dendy Drive as it adjoins the Property; iv) and along the Western-By-Pass are as
set forth on Tentative Map No. 35181 (the "Map"). The foregoing notwithstanding, potential
additional access points are shown on Exhibit J. The number and precise locations of such
potentially additional access points are to be analyzed and agreed upon in good faith by the
CITY and OWNER in conjunction with the processing of applicable development plans in the
future bearing in mind the reasonable commercial considerations of OWNER and the reasonable
safety and design considerations of CITY. CITY and OWNER may reasonably modify the
location of the access points through an Operating Memorandum pursuant to Section 2.6.4
approved by the OWNER and the City Manager of CITY.
4.1.10. Offer of Dedication of CherrY Street. OWNER shall, in
consideration of all benefits received under this Agreement, grant or dedicate to the CITY or
other such governmental agency as may construct Cherry Street, such right of way, roadway,
utilities, slopes, walls, piers, or other construction that would facilitate construction of Cherry
Street ("Cherry Street ROW"). The foregoing notwithstanding, the area where such easements
or other authorizations as may be required is limited to that area within the Right-of-Way as
approved on Tentative Map 35181. The City, or any other governmental agency, as the case
may be, shall be responsible for any and all retaining walls and slopes required to keep the
impacts of Cherry Street within the Right-of-Way and shall not impede the development of the
any parcel within Tentative Map No. 35181. If the CITY is able to obtain approval from all
applicable governmental agencies associated with the construction of portions ofthe Western
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By-Pass northerly of the City's boundary and accepts the aligrunent ofthe Western By-Pass as
depicted on Exhibit N or ever abandons its intention to design and construct part or all of Cherry
Street such that part or all of the Cherry Street ROW is no longer reasonably needed by the CITY
for the construction of Cherry Street, CITY agrees to execute and forthwith record such
documents as are reasonably needed to release that portion of the Cherry Street ROW that is no
longer needed from any lien, easement, or obligation created by this Section 4.1.10. In addition,
OWNER shall have the option tO,relocate the detention basin, in accordance appropriate CITY
permit processes and extend improvements within the previously dedicated area in a manner
which the parties shall negotiate in good faith. Furthermore, in such event, CITY shall use good
faith efforts to secure access points to the Western By-Pass in the same approximate latitudinal
position to the access points to the Westem By-Pass for Cherry Street approved on Tentative
Map 35181. The requirements of the last sentence are demonstrated on Exhibit N. If the CITY
or other governmental agency designs and constructs Cherry Street, the CITY or such other
agency shall be responsible for all costs associated with Cherry Street, including without
limitation roads, utilities, slopes, grading, retaining walls, and landscaping with the exception
that the OWNER bears all associated costs related to connection with Cherry Street.
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4.1.11. Water Oualitv Plan. CITY agrees that a Water Quality Plan for the
development of the PHS Property will satisfy the current water quality requirements of CITY for
the Project as presently designed if it is in substantial conformity as that depicted in the Project
Specific Water Quality Management Plan prepared by SB&O dated June 10, 2007 for the PHS
Property on file in the Office of the City Clerk.
4.1.12 Offer of Dedication of Western Bv-Pass Easements. OWNER
shall, in consideration of all benefits received under this Agreement, grant or dedicate to the
CITY, or such other governmental agency as may construct the Westem By-Pass, such
easements or other authorizations as may be necessary for the Western Bypass to utilize a
portion of the Property for right of way, roadway, utilities, slopes, walls, piers, or other
construction that would facilitate construction of the Western By-Pass (UWestern By-Pass
ROW") Within the Right-of-Way and easements as approved on Tentative Map No. 35181. If
the City ever abandons its intention to design and construct part of all of the Western By-Pass
such that part or all of the Western By-Pass ROW is no longer reasonably needed for the
construction of the Western By-Pass, CITY agrees to execute and record such documents as are
reasonably needed to release that portion of the Western By-Pass ROW no longer needed from
any lien, easement, or obligation created by this Section 4.1.13. Furthermore, in the event of
such partial or full abandonment or in the event that the final aligrunent of the Western By-Pass
is such that part or all ofthe Eastern most toe of the Western By-Pass isWest of the aligrunent
approved in Tentative Map No. 35181 , then the CITY shall cooperate in good faith in
processing the OWNERS application for a lot line adjustment such that the Western Parcel Line
shall extend to the toe of the slope of the Eastern most edge of the Western By-Pass. As stated in
Section 4.1.1, the Western By-Pass aligrunent is in the design planning phase. Both parties have
in good faith developed an aligrunent to accommodate the development ofthe PHS Property to
the best of their respective abilities with the information available to at the time of approval of
this Agreement. In the event that circumstances arise that cause an alteration in the assumed
horizontal and vertical aligrunent and associated appurtenances for the Westem By"Pass, the
OWNER and the CITY shall cooperate in good faith with the each other in processing
adjustment(s) ofthe lot lines, easements and access points described in this Agreement or the
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Project Approvals, except to the extent that said adjustments would have a material adverse
economic impact on the Project. That certain document entitled "Western Bypass Alignment-
North Segment-55 mph Design Speed" dated April 24, 2007, prepared by URS for the City of
Temecula shall be the reference point for determining the extent of any such change of alignment
and economic impact.
4.1.13. Western Bv-PasslProiect Aooroval Conditions. Subject to the
provisions of Section 4.1.5 above, none of OWNER's or PHS's Project Approvals or permits
shall contain conditions requiring the construction or completion of any portion of the Western
By-Pass, except those improvements associated with connection of the extension of Remington
Road as described in Section 4.1.7 above.
4.2. OWNER's Obligations to Construct Public Imorovements. OWNER
shall, at its sole cost and expense, design, construct, install, and finally complete Off-Site
Improvements. The design, construction, installation, and final completion of the Off-Site
Improvements shall be in conformance with the CITY standards in effect as of the date of this
Agreement and Improvement Plans approved by the CITY Engineer. Except as otherwise
provided in this Agreement, the Off-Site Improvements shall be completed at such time as set
forth in the conditions of approval for Development on the Property. CITY and OWNER shall
enter into the CITY's standard subdivision improvement agreement, or an applicable
modification thereof, for the completion of the Public Improvements.
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4.3. Maintenance of Improvements. Responsibility for the ongoing
maintenance of improvements provided by OWNER pursuant to this Agreement shall be
apportioned between the parties in accordance with the terms of this Section.
4.3.1. CITY Maintenance of Dedicated Public Imorovements. CITY
shall maintain all dedicated and accepted Public Improvements, including but not limited to,
public streets and related walls, streetlights, and public storm drainage facilities.
4.3.2. OWNER Maintenance of Landscaoing and Storm Drain Facilities.
OWNER shall maintain all landscaping on the Property and on adjacent City rights-of-way and
all storm drainage facilities on the Property.
4.4. Easements. CITY shall grant such easements over CITY property as are
reasonably needed for the Development ofthe Property provided such easements do not impede
or interfere with public services provided on such properties. OWNER agrees to grant to the
CITY such easements over its property as are reasonably needed for the construction and
maintenance of public improvements, except to the extent such easements would have a material
adverse economic effect on the Project. Such grants shall be at no additional cost to the
OWNER or CITY.
4.5. Financing Mechanisms.
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4.5.1. Industrial Develooment Bonds. If requested by OWNER, CITY
shall cooperate in the issuance of Industrial Development Bonds, as allowed by State or Federal
law.
946783.6 Final 9118/07
19
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4.5.2. Cost of Creating Financing Mechanism. If the formation or
establislunent of any public financing mechanism is requested by OWNER, OWNER shall bear
the full cost of creating any and all such financing mechanisms.
4.6. Public Financing of Imllrovements. OWNER may, from time to time,
request CITY to establish one or more assessment and/or community facilities districts to finance
infrastructure, public facilities and/or fees that may be required in connection with the
Development ofthe Project and CITY agrees to use its best efforts to implement such requests
subject to applicable State and Federal law and to the Applicable Regulations.
5. Further Assurances to OWNER Regarding Exercise of Reserved Authoritv.
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5.1. Assurances to OWNER. The parties further acknowledge that the public
benefits to be provided by OWNER to the CITY pursuant to this Agreement are in consideration
for and reliance upon assurances that the Property can be developed in accordance with the
Project Approvals and this Agreement. Accordingly, while recognizing that the Development of
the Property may be affected by exercise of the authority and rights reserved and excepted as
provided in Section 3.2 ("Reserved Authority") of this Agreement, OWNER is concerned that
normally the judiciary extends to local agencies significant deference in the adoption of land use
regulations which might permit the CITY in violation of the Reserved Authority, to attempt to
apply regulations which are inconsistent with the Project Approvals pursuant to the exercise of
the Reserved Authority. Accordingly, OWNER desires assurances that the CITY shall not and
the CITY agrees that it shall not further restrict or limit the Development of the Property in
violation of this Agreement except in strict accordance with the Reserved Authority.
5.2. Judicial Review. Based on the foregoing, in the event OWNERjudicially
(including by way of a reference proceeding) challenges the application of a future land use .
regulation as being in violation of this Agreement and as not being a land use regulation adopted
pursuant to the Reserved Authority, OWNER shall bear the burden of proof in establishing that
such rule, regulation, or policy is inconsistent with the Applicable Regulations, the Project
Approvals, or both and the CITY shall thereafter bear the burden of proof in establishing that
such regulation was adopted pursuant to and in accordance with the Reserved Authority and was
not applied by the CITY in violation of this Agreement.
6. Indemnification.
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6.1. OWNER agrees to indemnify and hold harmless the CITY, its agents,
officers, contractors, attorneys, and employees ("Indemnified Parties") from and against any
claims or proceeding against the Indemnified Parties to set aside, void or annul the approval of
this Agreernent. Notwithstanding the provisions of Section 2.5.1 of this Agreement, OWNER's
obligation pursuant to this Section is not a benefit or burden running with the land and shall not.
be assigned to any person without the express written consent of the CITY. OWNER's duties
under this Section are solely subject to and conditioned upon the Indemnified Parties written
request to OWNER to indemnify the Indemnified Parties. OWNER shall deposit the expected
costs of defense with the CITY within five (5) business days of notice from the CITY of the
claim and shall add to the deposit within five (5) business days from the request of CITY.
Without in any way limiting the provisions of this Section, the parties hereto agree that this
946783.6 Final 9/18/07
20
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Section shall be interpreted in accordance with the provisions of California Civil Code Section
2778 in effect as of the Effective Date..
6.2. Notwithstanding Section 6.1, and as a separate and distinct obligation of
OWNER, OWNER agrees to indenmify and hold harmless the Indemnified Parties from and
against each and every claim, action, proceeding, cost, fee, legal cost, damage, award or liability
of any nature arising from alleged damages caused to third parties and alleging that the
Indemnified Parties is or are liable therefor as a direct or indirect result ofthe CITY's approval
of this Agreement. OWNER's duties under this Section are solely subject to and conditioned
upon the Indemnified Parties written request to OWNER to indemnify the Indemnified Parties.
OWNER shall deposit the expected costs of defense with the CITY within five (5) business days
of notice from the CITY of the claim and shall add to the deposit within five (5) business days
from the request of CITY. Without in any way limiting the provisions of this Section, the parties
hereto agree that this Section shall be interpreted in accordance with the provisions of California
Civil Code Section 2778 in effect as of the Effective Date.
7. Relationshiu of Parties. The contractual relationship between the CITY and
OWNER is such that OWNER is an independent contractor and not the agent or employee of the
CITY. The CITY and OWNER hereby renounce the existence of any form of joint venture or
partnership between them, and agree that nothing contained in this Agreement or in any
document executed in connection with the Development of the Property shall be construed as
making the CITY and OWNER joint ventures or partners.
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8. Amendment or Cancellation of Agreement. This Agreement may be amended or
canceled in whole or in part only by mutual consent of the parties in the manner provided for in
Government Code Section 65868. No amendment or modification of this Agreement or any
provision hereof shall be effective unless set forth in writing and signed by duly authorized
representatives of each party hereto. This provision shall not limit the CITY's or OWNER's
remedies as provided by Section 10.3. .
9. Periodic Review of Compliance with Agreement.
9.1. Periodic Review. The CITY and OWNER shall review this Agreement at
least once every 12-month period from the date this Agreement is executed. The CITY shall
notify OWNER in writing of the date for review at least thirty (30) days prior thereto. Such
periodic review shall be conducted in accordance with Government Code Section 65865.1.
9.2. Good Faith Comuliance. During each periodic review, OWNER shall be
reqnired to demonstrate good faith compliance with the terms of this Agreement. OWNER
agrees to furnish such reasonable evidence of good faith compliance as the CITY, in the exercise
of its reasonable discretion, may require. If requested by OWNER, the CITY agrees to provide
to OWNER, a certificate that OWNER or a duly authorized Transfere~ is in compliance with the
terms ofthis Agreement, provided OWNER reimburses the CITY for all reasonable and direct
costs and fees incurred by the CITY with respect thereto.
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946783.6 Final 9118/07
21
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9.3. Failure to Conduct Annual Review. The failure of the CITY to conduct
the annual review shall not be an OWNER default. Further, OWNER shall not be entitled to any
remedy for the CITY's failure to conduct this annual review.
9.4. Initiation of Review bv CITY Council. In addition to the annual review,
the CITY Council may at any time initiate a review of this Agreement by giving written notice to
OWNER. Within thirty (30) days following receipt of such notice, OWNER shall submit
evidence to the CITY Council of OWNER's good faith compliance with this Agreement and
such review and determination shall proceed in the same manner as provided for the annual
review. The CITY Council shall initiate its review pursuant to this Section only ifit has
probable cause to believe the CITY's general health, safety, or welfare is at risk as a result of
specific acts or failures 'to act by OWNER.
9.5. Administration of Agreement. Any final decision by the CITY staff
concerning the interpretation and administration ofthis Agreement and Development of the
Property in accordance herewith may be appealed by OWNER to the CITY Council, provided
that any such appeal shall be filed with the CITY Clerk within ten (10) business days after
OWNER receives written notice that the staff decision is final. The CITY Council shall render
its decision to affirm, reverse, or modify the staff decision within thirty (30) days after the appeal
was filed. The decision of the City Council as to the administration of this Agreement shall be
finaJ and is not appealable. The foregoing notwithstanding, breaches of this Agreement are
subject to judicial relief as provided in this Agreement.
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9.6. Availabilitv of Documents. Ifrequested by OWNER, the CITY agrees to
provide to OWNER copies of any documents, reports or other items reviewed, accumulated or
prepared by or for the CITY in connection with any periodic compliance review by the CITY,
provided OWNER reimburses the CITY for all reasonable and direct costs and fees incurred by
the CITY with respect thereto. The CITY shall respond to OWNER's request on or before ten
(10) business days have elapsed from the CITY's receipt of such request.
10. Events of Default: Remedies and Termination. Unless amended, modified, or
suspended pursuant to Government Code Section 65869.5, this Agreement is enforceable by
either party hereto.
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10.1. . Defaults bv OWNER. If the CITY determines that OWNER has not
complied in good faith with the terms and conditions of this Agreement, the CITY shall, by
written notice to OWNER, specify the manner in which OWNER has failed to so comply and
state the steps OWNER must take to bring itself into compliance. If, within thirty (30) days after
the effective date of notice from the CITY specifYing the manner in which OWNER has failed to
so comply, OWNER does not commence all steps reasonably necessary to bring itself into
compliance as required and thereafter diligently pursue such steps to completion, then OWNER
shall be deemed to be in default under the terms of this Agreement. The foregoing 30-day period
shall be tolled during the pendency of any appeal undertaken pursuant to Section 9.5, if
applicable. Default of OWNER shall also include, but not limited to, OWNER's failure to
timely commence construction of the Public In1provements pursuant to this Agreement;
OWNER's failure to timely complete construction of the Public In1provements; OWNER's
failure to timely cure any defect in the Public In1provements; OWNER's failure to perform
946783.6 Final 9118107
22
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substantial construction work on the Public Improvements for a period of 20 calendar days after
commencement of the work; or OWNER's failure to perform any other obligation conceming
the Public In1provements under this Agreement. Except as provided in Section 13 ("Attomeys
Fees'') CITY's remedies for OWNER's breach shall be limited to those specified in Section 10.3.
10.2. Defaults bv CITY. If OWNER determines that the CITY has not
complied in good faith with the terms and conditions of this Agreement, OWNER shall, by
written notice to the CITY, specify the manner in which the CITY has failed to so comply and
state the steps the CITY must take to bring itself into compliance. If, within thirty (30) days after
the effective date of notice from OWNER specifying the manner in which the CITY has failed to
so comply, the CITY does not commence all steps reasonably necessary to bring itself into
compliance as required and thereafter diligently pursue such steps to completion, then the CITY
shall be deemed to be in default under the terms of this Agreement. OWNER's remedies for
CITY'S breach shall be limited to those specified in Section 10.3.
10.3. Legal Remedies.
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10.3.1. No MonetarvDamages. Due to the size, nature, and scope of the
Project, it will not be practical or possible to restore the Property to its natural condition once
implementation of this Agreement has begun. After such implementation, OWNER may be
foreclosed from other choices it may have had to utilize the Property and provide for other
benefits. OWNER has invested significant time and resources and performed extensive planning
and processing of the Development of the Property in agreeing to the terms of this Agreement
and will be investing even more significant time and resources in implementing the Project in
reliance upon the terms of this Agreement, and it is not possible to determine the sum of money
which would adequately compensate OWNER for such efforts. For the above reasons, the CITY
and OWNER agree that damages would not be an adequate remedy if the CITY fails to carry out
its obligations under this Agreement and that OWNER shall have the right to seek and obtain
specific performance as a remedy for any breach of this Agreement. Moreover, the CITY would
not have consented to this Agreement if it were to be subject to damages for breach of this
Agreement. Therefore, OWNER specifically agrees that it has no authority under this
Agreement to seek monetary damages against the CITY for any breach of this Agreement by the
CITY, and agrees not to seek monetary damages against the CITY for breach of this Agreement.
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10.3.2. Soecific Performance Remedv. The CITY and OWNER further
acknowledge that, if OWNER fails to carry out its obligations under this Agreement, the CITY
shall have the right to refuse to issue any permits or other approvals that OWNER would
otherwise have been entitled to pursuant to this Agreement. Therefore, the CITY's remedy of
denying issuance of permits or terminating this Agreement shall be sufficient in most
circumstances if OWNER fails to carry out its obligations hereunder. Notwithstanding the
foregoing, if the CITY issues a permit or other approval pursuant to this Agreement in reliance
(explicitly stated in writing) upon a specified condition being satisfied by OWNER in the future,
and if OWNER then fails to satisfy such condition, the CITY shall be entitled to specific
performance for the sole purpose of causing OWNER to satisfy such condition. The CITY's
right to specific performance shall be limited to those circumstances set forth above, and the
CITY shall have no right to seek specific performance to cause OWNER to otherwise proceed
with the Development of the Project in any manner.
946783.6 Final 9118/07
23
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10.4. Institution of Legal Action. In addition to any other rights or remedies,
and except as provided in Section 11.3, OWNER or the CITY may institute legal action to cure,
correct or remedy any default, to enforce any covenants or agreements herein, to enjoin any
threatened or attempted violation hereof to recover damages for any default, or to obtain any
other remedies consistent with the purpose ofthis Agreement. Such legal action shall be heard
by a referee from the Riverside County Superior Court pursuant to the reference procedures of
the California Code of Civil Procedure Sections 638, et seq., OWNER and the CITY shall agree
upon a single referee who shall then try all issues, whether of fact or law, and report a finding
and judgment thereon ana issue all legal and equitable relief appropriate under the circumstances
of the controversy before him/her. If OWNER and the CITY are unable to agree on a referee
within ten (10) days ofa written request to do so by either party hereto, either party may seek to
have one appointed pursuant to the California Code of Civil Procedure Section 640. The cost of
such proceeding shall initially be borne equally by the parties. Any referee selected pursuant to
this Section shall be considered a temporary judge appointed pursuant to Article 6, Section 21 of
the California Constitution.
10.5. EstoDDel Certificates.
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10.5. I. Written Request. Either party may at any time deliver written
notice to the other party requesting an estoppel certificate (the "Estoppel Certificate") stating: (1)
this Agreement is in full force and effect and is a binding obligation of the parties; (2) this
Agreement has not been amended or modified either orally or in writing or, if so amended,
identifying the amendments; and (3) no default in the performance of the requesting party's
obligations under this Agreement exists or, if a default does exist, the nature and amount of any
default.
10.5.2. Thirtv (30) Davs to ResDond. A party receiving a request for an
Estoppel Certificate shall provide a signed certificate to the requesting party within thirty (30)
days after receipt of the request.
10.5.3. Authorized Signatories.. The CITY Manager or any person
designated by the CITY Manager may sign the Estoppel Certificates on behalf of the CITY. Any
officer of OWNER may sign on behalf of OWNER.
and mortgagees.
10.5.4. Reliance. An Estoppel Certificate may be relied on by assignees
10.5.5. Reimbursement. In the event that one party requests an Estoppel
Certificate from the other, the requesting party shall reimburse the other party for all reasonable
and direct costs and fees incurred by such party with respect thereto.
10.5.6. Failure to Provide EstoDDel Certificate. Failure by a party to
provide an Estoppel Certificate within thirty (30) days after receipt of the request therefor shall
be deemed confirmation that this Agreement is in full force and effect, has not been amended or
modified either orally or in writing and that no defaults in the performance of the requesting
party's obligations under this Agreement exist.
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11. Waivers and Delays.
11.1. No Waiver. Failure by a party to insist upon the strict performance of any
of the provisions of this Agreement by the other party, and failure by a party to exercise its rights
upon a default by the other party hereto, shall not constitute a waiver of such party's right to
demand strict compliance by such other party in the future.
11.2. Third Parties. Non-performance shall not be excused because of a failure
of a third person, except as provided in Section 11.3
11.3. Force Maieure. OWNER shall not be deemed to be in default where
failure or delay in performance of any of its obligations under this Agreement is caused by
floods, earthquakes, other Acts of God, fires, wars, riots, terrorism, or similar hostilities, strikes
and other labor difficulties beyond OWNER's control, government regulations (including,
without limitation, state and federal environmental and natural resource regulations applied to
the Property), or judicial decisions directly applicable to the Property.
11.4. Extensions. The Term ofthis Agreement and the time for performance by
OWNER or the CITY of any of its obligations hereunder shall be extended by the period of time
that any of the events described in Section 11.3 and this Section 11.4 exists and/or prevents
performance of such obligations. In addition, the Term shall be extended for delays arising from
the following events for a time equal to the duration of each delay occurring during the Term.
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11.4.1. Litigation. The period of time after the Effective Date during
which litigation related to this Agreement or having the actual effect of delaying implementation
of the Development of the Property is pending, including litigation pending on the Effective
Date. This period shall include any time during which appeals may be filed or are pending.
11.4.2. Government Agencies. Any delay resulting from the acts or
omissions of the CITY or any other governmental agency or public utility and beyond the
reasonable control of OWNER except those related to the normal and customary processing of
Future Development Approvals.
12. Notices. All notices required or provided for under this Agreement shall be in
writing and delivered in person or sent by certified mail, postage prepaid, return receipt
requested, or by overnight delivery. Notices required to be given to the CITY shall be addressed
as follows:
City ofTemecula
43200 Business Park Drive
Post Office Box 9033
Temecula, CA 92589-9033
Attention: CITY MANAGER
With a copy to:
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Richards, Watson & Gershon
355 South Grand Avenue, 40th Floor
946783.6 Final 9118/07
25
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Los Angeles, CA 90071-1469
Attention: Peter M. Thorson, City Attorney
Notices required to be given to OWNER shall be addressed as follows:
The Garrett Group, LLC
One BetterW orld Circle, Suite 300
Temecula, CA 92590
Attention: John Potts, Vice President Real Estate
With a copy to:
Martin A. Weiss, J.D., LLM,
General Counsel
One BetterWorld Circle, Suite 300
Temecula, CA 92590
A party may change its address for notices by giving notice in writing to the other party
as required herein and thereafter notices shall be addressed and transmitted to the new address.
All notices under this Agreement shall be deemed given, received, made or communicated on the
earlier of the date personal delivery is effected or on the delivery date or attempted delivery date
shown on the return receipt, or air bill.
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13. Attornevs' Fees. Iflegal action is brought by either party against the other for
breach of this Agreement, including actions derivative from the performance of this Agreement,
or to compel performance under this Agreement, the prevailing party shall be entitled to an
award of its costs, including reasonable attorneys' fees, and shall also be entitled to recover its
contribution for the costs of the referee referred to in Section 10.4 above as an item of damage
and/or recoverable costs. Attorneys' fees under this Section shall include attorneys' fees on any
appeal and, in addition, a party entitled to attorneys' fees shall be entitled to all other reasonable
costs and expenses, including, without limitation, expert witness fees, incurred in connection
with such action.. In addition to the foregoing award of attorneys' fees to the prevailing party,
the prevailing party in any lawsuit shall be entitled to its attorneys' fees incurred in any post.
judgment proceedings to collect or enforce the judgment. This provision is separate and several
and shall survive the merger ofthis Agreement into any judgment on this Agreement.
14. Recording. This Agreement and any amendment or cancellation hereof shall be
recorded, at no cost to the CITY, in the Official Records of Riverside County by the CITY Clerk
within the period required by Section 65868.5 of the Government Code.
15. Effect of Agreement on Title.
15.1. Effect on Title. OWNER and the CITY agree that this Agreement shall
not continue as an encumbrance against any portion of the Property as to which this Agreement
has terminated.
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15.2. Encumbrances and Lenders' Rights. OWNER and the CITY hereby agree
that this Agreement shall not prevent or limit any OWNER of any interest in the Property, orany
946783.6 FinaI9f18/07
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portion thereof, at any time or from time to time in any manner, at its or their sole discretion,
from encumbering the Property, the improvements thereon, or any portion thereof with any
mortgage, deed of trust sale and leaseback arrangement or other security device. The CITY
acknowledges that any Lender (as hereinafter defined) may require certain interpretations of or
modifications to this Agreement or the Project and the CITY agrees, upon request, from time to
time, to meet with the OWNER(s) and/or representatives of such Lenders to negotiate in good
faith any such request for interpretation or modification. The CITY further agrees that it will not
unreasonably withhold its consent to any such requested interpretation or modification to the
extent such interpretation or modification is consistent with the intent and purpose of this
Agreement. A default under this Agreement shall not defeat, invalidate, diminish, or impair the
lien of any Lender.
15.3. Notice of Defaults. The mortgagee of a mortgage or beneficiary of a deed
of trust or holder of any other security interest in the Property or any portion thereof and their
successors and assigns, including without limitation the purchaser at a judicial or non-judicial
foreclosure sale or a person or entity which obtains title by deed-in-lieu of foreclosure
("Lender") shall be entitled to receive a copy of any notice of default (as defined in Section 10.1
hereof) delivered to OWNER and, as a pre-condition to the institution oflegal proceedings or
termination proceedings, the CITY shall deliver to all such Lenders written notification of any
default by OWNER in the performance of its obligations under this Agreement which is not
cured within sixty (60) days (the "Second Default Notice") and shall allow the Lender(s) an
opportunity to cure such defaults as set forth herein. The Second Notice of Default shall specify
in detail the alleged default and the suggested means to cure it. After receipt of the Second
Default Notice, each such Lender shall have the right, at its sole option, within ninety (90) days
to cure such default or, if such default cannot reasonably be cured within that ninety (90) day
period, to commence to cure such default, in which case no default shall exist and the CITY shall
take no further action. Notwithstanding the foregoing, if such default shall be a default which
can only be remedied by such Lender obtaining possession of the Property, or any portion
thereof, and such Lender seeks to obtain possession, such Lender shall have until ninety (90)
days after the date of obtaining such possession to cure or, if such default cannot reasonably be
cured within such period, then to commence to cure such default. Further, a Lender shall not be
required to cure any non-curable default of OWNER, and any such default shall be deemed cured
if any Lender obtains possession.
16. Severability of Terms. If any term, provision, covenant, or condition of this
Agreement shall be determined invalid, void, or unenforceable, the remainder of this Agreement
shall not be affected thereby if the tribunal fmds that the invalidity was not a material part of
consideration for either party. The covenants contained herein are mutual covenants. The
covenants contained herein constitute conditions to the concurrent or subsequent performance by
the party benefited thereby of the covenants to be performed hereunder by such benefited party.
17. Subseauent Amendment to Authorizing Statute. This Agreement has been
entered into in reliance upon the provisions of the Development Agreement Legislation in effect
as of the Effective Date. Accordingly, subject to Section 3.2.2 above, to the extent that
subsequent amendments to the GovemmentCode would affect the provisions of this Agreement,
such amendments shall not be applicable to this Agreement unless necessary for this Agreement
to be enforceable or required by law or unless this Agreement is modified pursuant to the
946783.6 FinaI9/18/07
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provisions set forth in this Agreement and Government Code Section 65868 as in effect on the
Effective Date.
18. Local. State and Federal Laws. OWNER and its contractors shall carry out
the design and construction of all private improvements on the Property and all Public
Improvements in conformity with all applicable laws, including, without limitation, all
applicable federal, state and local occupation, employment, prevailing wage, safety and health
laws, rules, regulations and standards. OWNER agrees to indemnify, defend and hold the
Indemnified Parties (as defined in Section 6.1) harmless from and against any cost, expense,
claim, charge or liability relating to or arising directly or indirectly from any breach by or failure
of OWNER or its contractor(s) or agents to comply with such laws, rules or regulations.
OWNER's indemnity obligations set forth in this Section shall survive the termination or
expiration of this Agreement..
19. Rules of Construction and Miscellaneous Terms.
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19.1. Interoretation and Governing Law. The language in all parts of this
Agreement shall, in all cases, be construed as a whole and in accordance with its fair meaning.
This Agreement and any dispute arising hereunder shall be governed and interpreted in
accordance with the laws of the State of California. The parties understand and agree that this
Agreement is not intended to constitute, nor shall be construed to constitute, an impermissible
attempt to contract away the legislative and governmental functions of the CITY, and in
particular, the CITY's police powers. In this regard, the parties understand and agree that this
Agreement shall not be deemed to constitute the surrender or abnegation of the CITY's
governmental powers over the Property.
19.2. Section Headings. All section headings and subheadings are inserted for
convenience only and shall not affect any construction or interpretation of this Agreement.
19.3. Gender. The singular includes the plural; the masculine gender includes
the feminine; "shall" is mandatory, "may" is permissive.
19.4. No Joint and Several Liability. At any time that there is more than one
OWNER, no breach hereof by an OWNER shall constitute a breach by any other OWNER. Any
remedy, obligation, or liability, including but not limited to the obligations to defend and
indemnify the CITY, arising by reason of such breach shall be applicable solely to the OWNER
that committed the breach. However, the CITY shall send a copy of any notice of violation to all
OWNERS, including those not in breach. In addition, a default by any Transferee shall only
affect that portion of the Property owned by such Transferee and shall not cancel or diminish in
any way OWNER's rights hereunder with respect to any portion of the Property not owned by
such Transferee. The Transferee shall be responsible for the reporting and annual review
requirements relating to the portion of the Property owned by such Transferee, and any
amendment to this Agreement between CITY and a Transferee shall only affect the portion of
the Property owned by such Transferee. Any amendments to this Agreement between CITY and
OWNER shall not affect any portion of the PHS Property unless agreed to in writing by the
Transferee 0 f the PHS Property.
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19.5. Time of Essence. Time is ofthe essence regarding each provision ofthis
Agreement of which time is an element.
19.6. Recitals. All Recitals set forth herein are incorporated in this Agreement
as though fully set forth herein.
19.7. Entire Agreement. This Agreement constitutes the entire agreement
between the parties with respect to the subject matter hereof, and this Agreement supersedes all
previous negotiations, discussion and agreements between the parties, and no parol evidence of
any prior or other agreement shall be permitted to contradict or vary the terms hereof.
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19.8. Authoritv to Execute Agreement. The person executing this Agreement
on behalf of the OWNER warrants and represents to the CITY that this Agreement has been duly
approved by the OWNER and that all applicable notices and procedures were complied with and
that he/she is duly authorized by the OWNER to execute this Agreement on behalf of the
OWNER and has been duly authorized to do so.
19.9. Not for Benefit of Third Parties. This Agreement and all provisions
hereof are for the exclusive benefit of the CITY and OWNER and its Transferees and shall not
be construed to benefit or be enforceable by any third party.
19.10. Counteroarts. This Agreement may be executed in any number of
counterparts, and each of such counterparts for all purposes shall be deemed to be an original,
and all of such counterparts shall constitute one and the same agreement.
19.11. Exhibits. The following Exhibits are attached to this Agreement and
incorporated herein as though set forth in full:
. Exhibit A: Description of Property;
. Exhibit B: Off-Site Improvements;
. Exhibit C: PHS Property;
. Exhibit D: [Intentionally Deleted];
. Exhibit E: Western By-Pass;
. Exhibit F: Authorized Land Uses;
. Exhibit G: Resolution setting forth applicable Development impact Fee rates;
. Exhibit H: Projected Processing Schedule;
. Exhibit I: Plan for the Remington Road Extension, Including Future Access
Points;
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. Exhibit J: Curb Cuts;
946783.6 Final 9118/07
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. Exhibit K: MSHCP; and
. Exhibit L: [Intentionally Deleted]
. Exhibit M Depiction of Parcel 2 Grading
. Exhibit N Depiction of Alternative Access Points and Alignments Cherry
Street Right-of Way (Section 4.1.1 0)
I
I
946783.6 Final 9/18/07
30
I
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first written above..
CITY OF TEMECULA,
a municipal corporation
By:
Chuck Washington
Mayor
ATTEST:
Susan Jones, MMC
City Clerk
APPROVED AS TO FORM:
I
Peter M. Thorson
City Attorney
I
31
I
TEMECULA PROPERTIES, LLC
A California limited liability company
By: Redhawk Communities, Inc.
A California corporation
Its: Managing Member
By:
Paul Garrett, President
I
I
32
I
PROFESSIONAL HOSPITAL SUPPLY, INC, a
California corporation.
By:
John Augustine
Chief Financial Officer
I
I
33
I
State of Califomia
)
)
)
ss
County of Riverside
On before me, , (here insert name of the
officer), Notary Public, personally appeared
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in hislher/their authorized capacity(ies), and that by hislher/their
signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
Witness my hand and official seal.
Signature of Notary
State of California
)
)
)
ss
I
County of Riverside
On before me, , (here insert name of the
officer), Notary Public, personally appeared ,
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in hislher/their authorized capacity(ies), and that by hislher/their
signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
Witness my hand and official seal.
Signature of Notary
I
34
I
EXHIBIT A
(Description of Property)
I
I
EXHIBIT A
I
LEGAL DESCRIPTION
PARCEL A. LOT LINE ADJUSTMENT NO. PA-06-0179
I
PARCEL A. Lot Line Adjustment No. P A 06- 0279
Parcel A of City ofTemecu1a Lot LIne Adjustment No. PA-06-0279, approved by
the City ofTemecula on November 16, 2006 and recorded pecem.ber 7, 2006 as
Instrwnent No. 2006-0898508, Official Records of RiVerside, County, State of
California. being more particularly.described as follows:
Being a porJlon o/Parcel "A" 0/ Lot Line Adjustment No.1 1, In the City 0/
Temecula, CountyofRivmlde, State o/Callfornia, recordedJanuary 13,1993, as
Instrument1/(}. -13666 of Official Records of said County. olio a portion of Parcel "B" of
lot line Adjustment No. PAOO-0051, in the City ofTemecU#a, County of Riverside, State
o/California, recorded MOy 19,2000, as Instrument No. 2000-190898, o/Officlal
Records of said Coimty, more particularly described as follows:
COMMENCING at the westerly corner of said Parcel ",,4 ";
Thence North 48 'fJ9 '38 "East along the northwe.rter/y line of said Parcel "A", a
. distance of688.10feet, being the TRUEPO/NTOF BEGlNNJNG;
Thence leaving said northwesterly line, South 29,,(}8'20" East, Q distQnce of
641.21 feet, 10 the beginning 0/ Q tangent curve concave southwesterly, having a radius
0/1050.00 feet, a radial line bears North 60"5I'40"Ec1st;
Thence southeasterly along said curve through Q central angle of 11 "49 '37", an
Qrc dislcmce of216.74feet;
Thence South 17"18'43" East, Qdistanceof109.23feet, to the beginningofQ
tangent curve concave northeQsterly, having Q radius of 1450.00 feet, a radial line bears
South 72"4J'17"West;
Thence southeasterly along said curve through a cenJral angle 34 ,,(}2 '06, an arc
distance of861.33 feet;
Thence South 51 "20'49" East, a distance of88.82 feet, to the southeasterly line of
said Parcel "B";
Thence along said southeasterly fine North 38"49 '43" East, a distance of 11 56.40
feet, to the centerline o/Winchester Road (100.00 feet wide);
Thence along said centerline North 19"53 '29"West, a distance of232.02 feet;
Thence leaving said centerline South 70 ,,(}6'3J" West, a distance 0/50;00 feet, to
the beginning 0/ a non-tangent curve concave southwesterly, having a radius 0/800.00
feet, a radial line bears. North 70 ,,(}6'31 "East. also being a point in the southwesterly
right-ol-way line of said Winchester Road
I
D:\65472\sumy\llAlPan:eI A LLA PA06-021~.tloc.
I
Legal Description
Parcel A, Lot Line Adjustment No. PA-06-0279
Page 2 of2
Thence northwesterly along said curve and said right-of-way line through a
central angle of26"27'06", an arc distance of369.33 feet;
Thence along said right-of-way line North 46"20'35" West, a distance of 184.96
feet, to an angle point In said right-of-way line;
Thmce along said right-of-way line South 88"39'25" West, a distance of32.S3
feet;
I
Thence along said right-of-way line North 46"20'35" West, a distance of 50. 00
feet, to the southwe.rterly prolongation of the centerline of Dendy Parkway (100.00 feet
wide);
Thence along saJd prolongation and said centerline North 43 "38'42H East, a . .
distance of 428. 76feet, to the beginning of a tangent curve concave southeasterly. having
a radiu:r of850.00feel, a radial line bears North 46"21 'l8w West;
Thence northeasterly along said curve and saJd centerline through a central
angle of27041'40H, an arc di:rtance of 411.10 feet;
Thence along said centerline North 71 "21'22" East, a distance of356.61 feet, to
the beginning of a tangent curve concave northwesterly, having a ra.dius of850.00 f!et, a
radial line bears Sourh 18"37'55" East;
Thence northeasterly along said curve, through a central angle of 02 "29'54", an
arc distailee of 12.23 feet, to the southerly corner of that certain parcel of land as
described in Grant Deed to the City ofTemecula, recorded April 23, 1991 as Instrument
No.146241, OfficiaJ Records of Riverside County;
Thence along the southwesterly line of saidparcel of land conveyed to the City of
Temecula North 41 ".50'22" West, a distance of 1001.63 feet, to the westerly corner
thereof, being a paint in the northwesterly line of said Parcel "A ";
Thence along said northwesterly line South 48"09 '38" West, a distance of
2019.60 feet, to the TRUE POINT OF BEGINNING.
The above described parcel of land contains 66.23 acre:r, more or le:r:r_
This was prepared by me
or under my direction.
S.B. & 0., Inc.
~~
IX: CROWTHER a
"" Em ~.?1\-of> :x>
'* ..... *
\ ~ No. 61:34..V~
"<'!!fOFC"L~
.......... -8 D - ~ ,,~ ~ j\.\i\DclA-7 'l<:JOi
,
Marissa Crowther, PLS 6152 Date
I
D:\65472\sIllYC]lUl.AIParuI A ILA PA06-l1l79.dDC
I
EXHIBIT B
(Off-Site Improvements)
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EXHIBIT C
(PHS Property)
I
I
EXHIBIT C
I
LEGAL DESCRIPTION
LOT 4, TRACf MAP NO. 35181
Lot 4 of Tract Map No. 35181, in the City ofTen:ieeula, recorded in Book of
Maps, Pages through . inclusive, Records of Riverside County, State
ofCaliforma.
. . _~ ~1I1l~ .
fI =~ \\.
: .. It" f1' 6'1>-, -~ - ~ 1, zoo')O- ...... ~.J',JI~Cloe. :II
- *~ *
Mariasa Crowther, PLS 6152 Date. . ':'>l No. 616~
'9JiOFC^i.\~
This was prepared by me
Or under my direc:lion.
S.B. & 0., Inc;
I
I
D:165472\surveylPllrtd Map\lA>l4 Leplllmripli...doe
I
EXHIBIT D
(Intentionally Deleted)
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EXHIBIT E
(Western By-Pass)
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EXHIBIT F
(Authorized Land Uses)
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Parcel 1
EXHIBIT "F"
ALLOWABLE LAND USES
Parcel 2
Parcel 3
Parcel 4
Industrial
Industrial
0IIIce
RetaO
MulU-FamDy Residential
Eduqatlon
Induslrlal
Office
Retail
Industrial
Office
I
EXHIBIT G
(Resolution regarding Development Impact Fee rates)
I
I
II
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,
,
I
REIOLunoN NO. 03013
A RESOLU110N OF THE CITY COUNCIL OF THE CITY OF
TEMECULA ElTAlLlSIING AND IMPOSING NEW
DEVELOPMENT IMPACT FEes AND INCREASING CURRENT
DIVELOPIIENT IMPACT FEES EFFECTlVE JULY 20. 2003
PURSUANT TO CHAPTER 1U1 OF THE TEMECULA
MUNICIPAL CODE AND RESOwnoN NOS. 170114 AND IAO.
WHEREAs, on May %7, 1997, the CIty COIIICI adop/8cl 0rcfJnMce No. 97-09
establishing Chapter 15.08 01 the Tenl8CWI MIIlk:IpaI Code, NIle FaciIIIIes DeveIopmenI
ImpaQ Fee ("DIP), which was mocIIIed by Ordlnellce No. 97.14 on Augusl18, 1997, ancI was
'further modIlIed by OrdInance No. 98-05 on Ap11114, 1998; and
WHEREAs, on May %7, 1997, Ihe City CouncIl adopted Resolution No. 91-45 which
.establlshed the Development Impact Fees. This ResoIullon was restated and modlfled by
Resolution No. 98-30 \)/'I ApfiI14, 1998; and
WHEREAS, the City Ccu1cII adopted resIdenIIaI DIF as recommended In a
Development Impact Fee Study conducted by Davld M. G!iffiIh and AssocIates ('ONG"). and
adopted non-realclenllal DIF al 36% of lhe amount recommended by OMG; and
WHEREAS. Resolullon 98-30 provides for an automa6e annual .adjuslment of bolh
I1lSIdeIIIIaI and II!)IHesJclential OIF based on the percentage /na'ease or decrease. If any, of the
. EngIneering News Record BuIlding CoslIncIex ('BCl") for lie Los Angeles MefropoJlIiIn MIl
BCltor the twelve mOnth period prior 10 May 1 of Ihe year In which the change wRI be effecllve;
and
WHEREAS. Exhibit B 10 Resolution 98-30 contains projected fees for seven (1) years
with no escaiaUon applied 10 reslden6a1 OIF and an escaIaUon of 10% per year applied 10 non-
'. resld9ll1lalOlF untA fees reach 60% of the recommended fee; and
WHEREAS. DeveIopmenllmpacl Fees are Iyplc:ally analyzed every three 10 five years 10
:monetarRy quanlIfy the Impacls of d8v!llopment 01'1 cetlaln C8JliIaI facilities; and
WHEREAs, In August 2002, the City oonlracted with the f1nn of Maxlmus (fOl'l1lerly
':DMG) to prepare a report provldlng reca/cuIated devaIopment Impact fees based on updated
Information on exrsUng and future devalopment and facilUes.
NOW, THEREFORE, BE rr RESOLVED by the City Council of the City of TemeCUla as
follows:
Sect/on 1. The City CouncIl of the City of Temecula does hereby find. detannlne and
c:ledare as foIows:
A. As detailed In ElchIblls A. raslclenllel Deve!opmenllmpact Fees shaD be adopted as
recommended In the Impact Fee Study Report completed by MaxllllUS- dated March
10,2003.
R:IResoe 2OO.1IReIoI 0U3
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B. AI dllt8lied In ExhIIII B. non-reaIdenlJBl Development Impect Filii ahal be phased In
over . Ihree-yw period. The IIClI'HlIS/denllal fees would not be Inc:rtaaed (excepI
for Itle lIVlual BCI edjuatment) UIIIII Juti 1, 2004 and would phase In 10 100% of the
recommended 'IU beginning July 1. 2008.
C. AccoRIIng 1o.~1IIon 98-30, both rell!denllal and non-resklenUal deveJopmena
/mpacI 'eei wII be eublect 10 In auIam8IIc lIIlIIlIaI adjU8ImenI based on the
~ Incr8ue or decrease, If lIlY. of Ih8 EngIneerfng News Record BuIldIng
Coat Index ("Bel") for 1h8!.oe Ange/ea MeI1opoltan MIa BCI for the twelve nionll1
peIfod prtor to Mil)' 1 of Itle y.. In whIcIIlh. ch8nge wII be effecllve.. Th8H
annual BCllldjualmenl8 woukl conIInue cbIng the ph.. In of nOIH'8SIdenllIHees.
SectIon 2. These cIeYelopment ~ fees wtI be elJecUva July 26, 2003.
PASSED, APPROVED _d ADOPJ'ED by the CIty ColIIcII of the City of Temecuta at a
l8gular meeUng held on 1118 27'" day of May. 2003.
. I'
ATTEST:
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J.
-I
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R:IRaos 2J03IResoo 0U3
2
, hlley ."IIIy. ..dOl Ih, pon>lly 01 pOllury '''''
III. Ill". 'nd loft1jCille I, . Iru. ond COll'ct c,py
" on 0lIgIntJ DO dope.il wahl. Ill. 'ocOldo ,'11le
Oily 01 T.....".. In .nn... who..... I hOY.
holllllllo ,el '" h.nd .nd .,lxld Ill. SOIl.' 1ho
OllyolT....C1II.lhlsl!o..d.,01 ~"2<l~
Mlcll..,. A. 8011tolch. Dopu1y CIty .1lI
bv: U-.::.~.,\. 1\..00.. - L
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STATE OF CALIFORNIA )
COUNTY OF RIVERSIDE )..
CITY OF TEMECULA )
, I. S... W. Jonea. aty CIerfc of the aty of TemeaU. C8Ifo. .1Ia, do tiereby c:erIIfy that
ResonIIlon No. 0M3 WIll duly end regu/artf acIoIlted by the CRy CoundI of the CIty of
Temecufa at a regular ,",11Ing 1hereof1leld oiIlhe ~ day of May; 2OCl3. by the following volt:
AYES:. 4 COUNCUfEMBERS: Comerdlero. NaD9ar;l~oberts. Stone
NOES: o. COUNClLMEMBERS: None
ABSENT: 0 COUNCllJ.fEMBERS: None
ABSTAIN: 1 COUNCILMEMliERS: Prall
R:.flesos 20031Res0s IJ3.e3
.3
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ATTACIIIEHrA
crrv Of'TIIifcuu
DEVILOPIIINT....ACr ....
COUPAflI8OH: CUIlRENl' FEU V" tnIDY IWlIMUII AU.OWAIlU PIES
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EXHIBIT H
(Project Processing Schedule)
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PHSlThe Garrett Group/qty of T emecula
PROCESSING SCHEDULE.
Task Due [)ate #. of da-
Gladlnn Plans Resubmitted {3rd revlslor.\- OS/25/2007 ..
Gradlnn Plan Convnents to Aoollllllnt 06/0812007 14 days
. Bulldino Plans Submitted 0611412007
Bulldlnn Plan COIIImentS to Aliollcant 06128/2007 14 days
Bulld~Plans Resubmitted 07/12/2007 14 davs
~uildlon Plan Comments lo-ADDllcant 07/19/2007 7 dalis
30-dav CEQA Notice Due 06101/2007
PC SRlCondltlons .of Alioioval Due 06101/2007
I>lann!no Commil,sion hearlna lall aoollc:ations\ 09/05/2007
Ch cour:JCn hearlna IDA and GPA\ 09/2512007
Precise GmdJnn Permit available for PHS {Parcel 4\' 09/2612007
CItv Counc:lIZW' reading IGPA, DA\ 10/09/2007
IDA Validation ACtion Filina Deadline. . 10114/2007 5 days
IDA Validation ActiOn Resolved Deadline 01/1212008 90 days
Rulldlnn Permit available for PHS IParcel 4\" . 01/12/2008
Il=lnal.Mao-Recordation 03/07/2008 5 months
Red = Applicant
Blue = Staff
Green = All
, Contingent upon mlllgation measures being mel
"Contingent upon conditions of approval being mel
08/29/2007
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EXHIBIT I
(Plan for Remington Road Extension Including Future Access Points)
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EXHIBIT L
(Intentionally Deleted)
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EXHIBIT M
(Depiction of Parcel 2 Grading)
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