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HomeMy WebLinkAbout030805 CC Minutes I I I MINUTES OF A REGULAR MEETING OF THE TEMECULA CITY COUNCIL MARCH 8, 2005 The City Council convened in Closed Session at 6:00 P.M., on Tuesday, March 8, 2005, in the City Council Chambers of Temecula City Hall, 43200 Business Park Drive, Temecula, California. The Open Session convened at 7:00 P.M. Present: 5 Councilmembers: Edwards, Naggar, Roberts, Washington, and Comerchero Absent: o Councilmembers: None Welcoming her to the meeting, Mayor Comerchero acknowledged the attendance of former Mayor Birdsall. PRELUDE MUSIC The prelude music was provided by Eve Craig and the National Anthem was sung by Caylie Gregorio. INVOCATION The invocation was given by Pastor John Ruhlman of Life Church. PLEDGE OF ALLEGIANCE The pledge of allegiance was presented by Councilman Naggar. PRESENTATIONS/PROCLAMATIONS Certificate of Achievement to Charles Somers. Troop No. 337. for attainina his Eaale Scout rank Mayor Comerchero presented the City's Community Pride Eagle Scout pin along with a certificate to Charles Somers who briefly described his Eagle Scout project to the City Council and public. Certificate of Appreciation to the Assistance Leaaue Congratulating this organization on its 15th anniversary and commending the Assistance League on its continual support and service to those in need, Mayor Comerchero presented a Certificate of Appreciation to the representatives of the League. Appreciating the Council's support of the organization, Ms. Marilyn Hewlett thanked the City Council for the recognition. Proclamation for the Rotarv Club's 1 ooth Anniversarv Not only celebrating the 30th anniversary of the City's local Rotary Club but also the 100th anniversary of Rotary International, Mayor Comerchero commemorated this occasion with presenting a proclamation to Rotary President Elect Brown. R:IMinutesl030805 I I I Presentation to the Maraarita Middle School Students for Sponsorship to Nakavama. Japan Mayor Comerchero advised that, this month, a delegation of nine students from Margarita Middle School will be traveling to the City's Sister City -- Nakayama, Japan. In an effort to assist with offsetting the cost with such a trip, a $200 check was presented to each of the nine students. The nine students traveling to Nakayama, Japan, will be as follows: Amanda Malley Sara Malley Venus Mez-Duke Duong Laura Woodland Alice Brown Sheldon Reynolds Susanna Yang Brenton Haerr PUBLIC COMMENTS A. Due to a recent personal experience, Mrs. Pat Birdsall, Temecula, apprised the City Council of the City's need for a hospital. To assure the quality of life for the residents in this City, Mrs. Birdsall encouraged the City Council to expedite the completion of a hospital. With regard to the construction of a hospital in the City, Mayor Comerchero advised that the City, on its level, has been proceeding as quickly as possible but noted that needed State approval has created some delays. Councilman Naggar advised that the construction of a hospital will be discussed at the April 6, 2005, Planning Commission meeting. B. Ms. Lanae Turley-Trejo, Temecula, representing the Church of Jesus Christ of Latter- Day Saints, invited the Councilmembers and the public to a community event, benefiting the tsunami victims, on Saturday, March 19, 2005, 9:00 A.M. to 1:00 P.M., at Great Oak High School. C. Mr. Don Jones, Temecula, representing Chaparral High School Education Foundation, invited the City Councilmembers and the public to the Annual Community Swap Meet and Craft Faire at Chaparral High School on Saturday, March 19,2005, 7:00 A.M. to 2:00 P.M. D. Mr. Carl Burke and Mr. James Morgan, representing the YMCA, thanked the City Council for the gift of the land for the future site of a YMCA facility and its continuing support and advised that in the past year, over $2 million have been raised, exceeding YMCA's commitment to raise $1.7 million by 2008. It was noted that drawings have been completed; that a general contractor has been identified; and that efforts are ongoing to seek in-kind donations. R:\MinutesI030805 2 I I I CITY COUNCIL REPORTS A. Referencing Consent Calendar Item No. 13 (On-Call Traffic Signal Maintenance Services), Mayor Pro Tern Roberts stated that, in his opinion, the City's traffic signals are not working as well as they were at incorporation and suggested the completion of a survey and consideration of upgrading/replacing certain traffic signal controls/sensors in the upcoming budget process. B. With regard to the City's request to the State Senate/Assembly to address the widening of Winchester Road Off-ramp over Santa Gertrudis Creek and to explore the possibility of an additional off-ramp onto Jefferson Road, Councilman Naggar informed the public that Senator Hollingsworth has secured matching funds in the amount of $1.5 million - City would be reimbursed for $750,000. During the upcoming budget process, Mr. Naggar requested that staff explore the procurement of those $750,000, recommending that the matter be addressed with the City of Murrieta. C. Concurring with Mayor Pro Tern Roberts' comment regarding timing of traffic signals, Councilman Washington noted that efforts need to be devoted to improving traffic flow, commenting on Ynez and Rancho California Roads. Congratulating Community Services Director Parker and his staff, Mr. Washington commented on the rededication of a refurbished park - Pablo Apis Park - in Vail Ranch. Having attend yesterday's meeting of Western Riverside Council of Governments meeting, Councilman Washington commented on the discussion to delay implementation of Transportation Uniform Mitigation Fees related to development of commercial space (Class A office space); advised that although the vote was not unanimous, he had supported the delay in an effort to continue growth and economic development; noted that he would report to the Council on progress made; and advised that the cost of this delay will be approximately 1% of the overall TUMF collection within the two-year period. D. With six weeks having passed since she was appointed to the City Council, Councilwoman Edwards apprised the residents of the City's high-functioning staff and very functioning City Council and thanked staff for making her transition a very smooth process. E. Commenting on a meeting he had attended organized by Councilwoman Edwards, Mayor Comerchero advised that efforts are underway to explore the possibility of upgrading and expanding a local Hemet television station in an effort to establish a local television station. Advising that the Soboba Indian Tribe will be the owner of 120 acres of property near the intersection of Domenigoni Parkway and Winchester Road on which it may build a casino and hotel, Mayor Comerchero advised that in an effort to establish a similar relationship with the Soboba Tribe as enjoyed with the Pechanga Tribe in the event the Tribe chooses to proceed with that project, the City has met with the Tribe. R:IMinutesl030805 3 I I I CONSENT CALENDAR 1 Standard Ordinance and Resolution Adoption Procedure RECOMMENDATION: 1.1 Motion to waive the reading of the text of all ordinances and resolutions included in the agenda. 2 Minutes recommendation: 2.1 Approve the minutes of February 8, 2005; 2.2 Approve the minutes of February 22, 2005. 3 Resolution approvina List of Demands RECOMMENDATION: 3.1 Adopt a resolution entilled: RESOLUTION NO. 05-24 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ALLOWING CERTAIN CLAIMS AND DEMANDS AS SET FORTH IN EXHIBIT A 4 City Treasurer's Report recommendation: 4.1 Receive and file the City Treasurer's Report as of January 31, 2005. 5 Temecula On Staae Event Sponsorship Reauest RECOMMENDATION: 5.1 Approve the event sponsorship agreement for actual City-support costs in the amount up to $5,425 for Temecula On Stage and authorize the Mayor to execute the agreement. (Councilman Washington abstained with regard to this item.) R:IMinutesl030805 4 I I I 6 Authorize the Temporarv Street Closure of Third Street between Old Town Front Street and Murrieta Creek for the Annual Old Town Bluearass Festival Event scheduled for March 19 and 20. 2005. and deleaate authority to issue a Special Events/Street Closures Permit to the Director of Public Works/City Enaineer RECOMMENDATION: 6.1 Adopt a resolution entilled: RESOLUTION NO. 05-25 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA AUTHORIZING TEMPORARY STREET CLOSURE OF THIRD STREET BETWEEN OLD TOWN FRONT STREET AND MURRIETA CREEK FOR THE ANNUAL OLD TOWN BLUEGRASS FESTIVAL EVENT SCHEDULED FOR MARCH 19 AND 20, 2005, AND AUTHORIZING THE DIRECTOR OF PUBLIC WORKS/CITY ENGINEER TO ISSUE A SPECIAL EVENTS PERMIT INCLUDING STREET CLOSURES 7 Approve the First-Source Hirina Memorandum of Understandina between the Workforce Development Centers of Riverside Countv and City of T emecula RECOMMENDATION: 7.1 Approve the First-Source Hiring Memorandum of Understanding (MOU) between the Workforce Development Centers of Riverside County and City of Temecula. 8 Resolution reauestina that Conaress enact a Fiscal Year 2006 Budaet and Appropriations Packaae that funds CDBG Formula Grants at no less than current Fiscal Year 2005 Allocations RECOMMENDATION: 8.1 Adopt a resolution entitled: RESOLUTION NO. 05.26 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA REQUESTING THAT CONGRESS ENACT A FISCAL YEAR 2006 BUDGET AND APPROPRIATIONS PACKAGE THAT FUNDS CDBG FORMULA GRANTS AT NO LESS THAN $4.355 BILLION, WHICH IS LEVEL WITH FISCAL YEAR 2005 ALLOCATIONS R:IMinutesl030805 5 9 Retention Policv and Schedule Revisions I RECOMMENDATION: 9.1 Adopt a resolution entitled: RESOLUTION NO. 05-27 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA AUTHORIZING THE DESTRUCTION OF CERTAIN CITY RECORDS AS PROVIDED BY SECTION 34090 OF THE GOVERNMENT CODE OF THE STATE OF CALIFORNIA ESTABLISHING A RECORDS RETENTION PROCEDURE AND REPEALING RESOLUTION NO. 04-14 10 Acceptance of certain public streets into the City-maintained Street Svstem within Tract Map No. 28510 of the Campos Verdes Subdivision (located at the northeast corner of Maraarita Road and North General Kearnv Road) RECOMMENDATION: 10.1 Adopt a resolution entitled: I RESOLUTION NO. 05-28 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN CAMPOS VERDES SUBDIVISION TRACT MAP NO. 28510) 11 Tract Map No. 32170 (located at the southwest corner of Date Street and Lakeview Road) RECOMMENDATION: 11.1 Approve Tract Map No. 32170 in conformance with the conditions of approval; 11.2 Approve the Subdivision Monument Agreement and accept the Monument Bond as security for the agreement. 12 Tract Map No. 32169 (located at the southwest corner of Harveston Wav and Maraarita Road) RECOMMENDATION: 12.1 Approve Tract Map No. 32169 in conformance with the conditions of approval; I 12.2 Approve the Subdivision Monument Agreement and accept the Monument Bond as security for the agreement. R:IMinutesl030805 6 13 First Amendment to Contract Aareement for On-Call Traffic Sianal Maintenance Services I RECOMMENDATION: 13.1 Approve the First Amendment to the Contract Agreement with Republic Electric to perform additional On-Call Traffic Signal Maintenance Services for an amount not to exceed $50,000 and authorize the Mayor to execute the agreement. 14 Bridae Barrier Rail Replacement Proiect Proiect No. PW01-09 Approval of the Plans and Specifications and solicitation of Construction Bids RECOMMENDATION: 14.1 Approve the Construction Plans and Specifications and authorize the Department of Public Works to solicit construction bids for Project No. PW01-09 - Bridge Barrier Rail Replacement Project. 15 Transportation Uniform Mitiaation Fee (TUMF) Reimbursement Aareement RECOMMENDATION: I 15.1 Approve the model agreement for the funding of TUMF Regional Arterial Improvements between the Riverside County Transportation Commission (RCTC) and the City of Temecula for the Interstate 15/State Route 79 Ultimate Interchange project in substantially the same format as attached and authorize the City Manager to execute the final agreement. MOTION: Councilman Naggar moved to approve Consent Calendar Item Nos. 1-15. The motion was seconded by Councilwoman Edwards and voice vote reflected approval with the exception of Councilman Washington who abstained with regard to Item No.5. At 7:41 P.M., the City Council convened as the Temecula Community Services District and the Temecula Redevelopment Agency. At 8:01 P.M., the City Council resumed with regular business. PUBLIC HEARING 16 Wolf Creek Development Aareement Amendment PA05-0027 RECOMMENDATION: 16.1 Introduce and read by title only an ordinance entilled: I ORDINANCE NO. 05-04 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TEMECULA APPROVING THE FIRST AMENDMENT TO DEVELOPMENT AGREEMENT FOR THE WOLF CREEK PROJECT (PLANNING APPLICATION PA05-0027) R:IMinutesl030805 7 I I I Development Services Administrator McCarthy presented the staff report (as per agenda material), advising that the proposed amendment would change the threshold for the completion of two park sites: the completion of the north half of the linear park would be deferred from the 400th to the 600th building permit and the six-acre neighborhood park would be deferred from the 600th to the 700th building permit and that any design and construction cost in excess of the Development Impact Fee credit will be the sole responsibility of the developer. At this time, the public hearing was opened. Mr. Mike White, representing Wolf Creek Development, LLC, thanked staff for its associated efforts and requested City Council approval. There being no other speakers, the public hearing was closed. Viewing the proposed amendments as a benefit for the community, Councilman Washington thanked Mr. White and Development Services Administrator McCarthy for their efforts. Thanking the developer for the level of services provided, Mayor Comerchero as well commended staff on a job well done. At this time, City Attorney Thorson read the Ordinance No. 05-04 by tille only. MOTION: Councilman Naggar moved to approve staff recommendation. The motion was seconded by Councilwoman Edwards and electronic vote reflected unanimous approval. COUNCIL BUSINESS 17 Consideration of additional Sponsorship Fundina for the 2005 Temecula Vallev International Film and Music Festival RECOMMENDATION: 17.1 Consider additional sponsorship funding for the 2005 Temecula Valley International Film and Music Festival. Assistant City Manager O'Grady reviewed the staff report (of record), advising the Council that any funding in addition to what has previously been funded will require an additional appropriation. Thanking the City Council and staff for its continued support of this Festival, Ms. Jo Moulton, Director of the Temecula Valley International Film and Music Festival, by way of a PowerPoint presentation, commented on the growth this Festival has experienced; shared with the Council benefits as well as recognition this City has received from past and present Presidents and Governors as a result of this Festival; acknowledged local residents and businesses for their continued support; and requested that the City Council approve an additional $30,000 sponsorship for this year's event in order to take this Festival to a higher level. R:IMinutesl030805 8 I I I Commenting on the national and international notoriety of this event, Mr. Timmy D. Daniels, Temecula, viewed this Festival as a viable vehicle to promote tourism for the City and commented on how this Festival has evolved. Having worked in the film festival and economic development industry for 15 years, Mr. Steve Montal, La Jolla, commended the City on its accomplishments over the past 10 years with the Film and Music Festival but stated that this event is extremely under funded; encouraged the City Council to fund additional monies for this Festival; and noted that the additional funds will take this event to a higher level. Addressing the positive impact the Film and Music Festival has had on the City whether as a result of the film industry or as a consumer, Mr. Edward Stencel, Los Angeles, encouraged the City Council to fund the requested additional monies. Advising of the budget necessary for this gala event, Mr. Monty Seward, Murrieta, encouraged the City Council to increase its current funding and thanked the Council for its continued support. Describing the many different aspects associated with the operation of a film and music festival, Ms. Jennifer Byron, Temecula, addressed the financing needed to ensure updated technology and marketing and promotion demands of such an event and requested that the City Council approve the additional funding. Speaking in support of the Festival, Mr. Drake Frye, Menifee, encouraged the City Council to approve the additionally requested funds. Supporting the Festival, Mr. David Asmussen, Murrieta, representing the Garrett Group, advised that the Garrett Group has offered the Festival discounted lease space. Mr. Asmussen commended Ms. Moulton on her commitment to this event and requested that the City Council support the additional funds necessary for this event. Having worked with Ms. Moulton since the inception of this Festival, Ms. Beth Hoffman, Laguna Niguel, expressed her support of this Festival and shared, by way of a DVD, Mr. Darryl McDonald (Executive Director of the Palm Springs International Film and Music Festival) support of the request for increased funding. Thanking the City Council for its continued support, Ms. Annette Rosen, Temecula, commented on the volunteer efforts associated with this event, shared her experiences with the Film and Music Festival, and encouraged the City Council to support the additionally needed funds. Ms. Sunny Thomas, Temecula, thanked the City for its support but expressed the need to expand this event and the funds needed to accomplish this task. Having watched this event grow over the past 10 years, Mr. Bruce Singer, Murrieta, commended Ms. Moulton on the success of this event and encouraged the City Council to approve the additionally requested funds. Thanking Ms. Moulton for her vision, dedication, and passion for the Temecula Valley International Film and Music Festival, Councilman Washington commented on the benefits this event has provided to the City with regard to culture, economic development, and tourism and expressed his support of the request. R:\MinutesI030805 9 I I I Relaying his support of the request for the additional $30,000 sponsorship, Mayor Pro Tern Roberts referenced the positive impacts this Festival has on businesses throughout the City and, therefore, recommended that the Festival's current sponsors as well increase its sponsorships. Having been a volunteer at the first Festival, Councilwoman Edwards echoed comments that it would be time for the City to take this event to the next level. Extending appreciation to Ms. Moulton, the Board, and the volunteers on an excellent job, Councilman Naggar relayed his support of the additional appropriation but encouraged the Festival to decentralize itself from Ms. Moulton, encouraging the Board of Directors to be engaged to ensure the future of this Festival. Echoing Mr. Roberts, Councilman Naggar encouraged increased sponsorships from the private industry, commenting on the economic development. Concurring with his colleagues' comments, Mayor Comerchero expressed his support of the additionally requested funds. Although supporting the request, Mr. Comerchero explained his reservation with supporting the additional funding but commented on the intangible economic benefit that is not measurable and suggested that the City fund an audit for this event. MOTION: Councilman Washington moved to approve an additional sponsorship of $30,000 for the 2005 Temecula Valley International Film and Music Festival and to fund an audit at the conclusion of the event. The motion was seconded by Mayor Pro Tern Roberts and voice vote reflected unanimous approval. 18 Status and Discussion of Roripauah Ranch Community Facilities District Formation and Development Aareement (At the request of Councilman Naggar) RECOMMENDATION: 18.1 Receive and file. City Attorney Thorson reviewed the staff report, noting the following: · That the Roripaugh Ranch Development Agreement was approved in December of 2002 and that staff has been working since that time to implement the project and to provide for public improvements and to complete the Community Facilities District Bonds; · That the Development Agreement (DA) is a contract between the City and the developer; that it vests the developer's rights to develop the project in accordance with the terms of the Development Agreement and the entillements; · That this particular DA has required traffic improvements necessary to serve the project to be in place prior to the issuance of significant number of building permits; that this DA as well required the City to use its best efforts to provide for a means to finance these publiC improvements as well as the park and recreational amenities; that the DA provides that no residential building permit shall be issued until that Community Facilities District has been formed and funded; R:IMinutesl0308o5 10 I I I . That this development philosophy of the City, which has been applied in this DA, is consistent with the Wolf Creek DA , Harveston DA, and the Domenigoni DA and in challenging the Riverside County Integrated Plan; . That the Roripaugh Ranch DA provides a schedule for the issuance of building permits based on when certain improvements are completed; that the bulk of these improvements are to be completed prior to the 510th building permit; · That the City has entered into a number of other agreements with the developer in order to implement this -- such as the Deferral Agreement (approved September 2003); the First Operating Memorandum (approved September 2004); a License Agreement; and an agreement for the maintenance of the trails; . That the process of forming a Community Facilities District (CFD) and issuance of bonds has been ongoing since January 2003; that the CFD Bonds are essentially a loan with tax-exempt interest; that this loan is repaid by a special property tax on the lots within ihe development and paid for by the home buyers; and that the property secures the bonds; . That the amount available in a bond issue such as this is dependent on three significant factors: o Appraised value of the property o Absorption rate o Credit risk of the project . That as part of the development of the bond issue, the Financing Authority (Joint Powers of both the City and the Redevelopment Agency) must enter into certain agreements with other entities that will own the public improvements - known as a Joint Community Facilities Agreements; one with the City for the roads and park and recreational facilities; one with the Water District; one with Riverside County for roads; and one with Riverside County Flood Control for storm drain facilities; . That the 150-page Preliminary Official Statement clarifies to the Bond holders why this project will be viable; why their investment will be secure; and all of the potential risks and benefits of the project are included; . That at this point in time, the public improvements are not complete and most of the priority improvements - the road improvements and the traffic improvements - are not estimated to be completed until the end of 2005; that the problem the City has experienced with this project is that a significant number of lots have been sold to merchant builders; that approximately 515 lots of the available lots on the panhandle have been sold or are in escrow to be sold; that the merchant builders are ready to start construction but because the public improvements have not been completed, the merchant builders are unable to attain the building permits to actually start the process; that the graduated schedule of building permits is at follows: bulk of the improvements have to be completed to release 108 building permits; another cut-off point is 250th; and the significant cut-off point is the 515th building permit; that each of the five merchant builders are desirous of at least 100 permits to start and complete the projects; R:\MinutesI0308o5 11 I I I · That one of the merchant builders has filed a lawsuit against the developer, claiming breach of contract on their Purchase Agreement; that the lawsuit does not name the City but with this lawsuit pending, the Financial Advisors and the potential Bond buyers will not proceed with the bond issue because this lawsuit could affect the absorption rate, how many permits will be issued, and the impact on the project; . That if the lawsuit were resolved and the merchant builders are willing to proceed with the graduated schedule, the bonds could be issued in July 2005; . That staff has had discussions with the developer and has negotiated a Development Agreement Amendment which would have altered the schedule for the issuance of building permits, requiring all public improvements to be completed by the 250th building permit; that the merchant builders were not supportive of that schedule because they are in need of 100 building permits to make a viable development; · That the City's primary concern with amending the schedule of the building permits would be how to ensure the public improvements will be completed on a workable schedule. Clarifying the recommended action to be taken at this meeting, City Attorney Thorson, for Councilman Washington, noted that the intent of this item was to provide an update to the Council; suggested that the Council hear input from the merchant builders and developer and dependent on that input, recommended that Council direct staff to explore/readdress specific items and forward those options for consideration to a future City Council meeting. In response to Councilman Naggar, City Attorney Thorson advised of the following: . That the Development Agreement will run for 10 years; · That the merchant builders who bought the property are owners of the property encompassed by the Development Agreement but, to the City's understanding, the developer has not assigned to them the obligation to build the public improvements; . That the filed lawsuit raises an unknown with regard to the sale of the bonds; that the Financing Team/Underwriters, based on their experience, have stated that under these circumstances with the number of unknowns, it would be unlikely for buyers to buy these bonds; · That the City is obligated to use its best efforts to take the bond sale forward. Mr. Jim Fabian (the City's Financial Advisor), City Attorney Thorson, and Public Works Director Hughes addressed questions by the Council as follows: · That the improvements that are required under the Development Agreement are the obligation of the developer; that the CFD Bond proceeds are used to acquire the infrastructure from the developer; that if there were not sufficient CFD Bond proceeds to acquire the infrastructure, then the developer would not be reimbursed for all the public improvements required to be built for the development; that the issuance of bonds under the CFD is related to the value of the property; that the value of the property is related to how many units could be built and the absorption of those units under the scenario of the thresholds in the Development Agreement; that the development of the Roripaugh R:IMinutesl0308o5 12 I I I Ranch currently has uncertainties; that the documentation required to put the bonds into the market would not to be in a concise manner to the bond market in order to identify the associated risk with the purchase of the bonds; that if the bonds were to be sold, it may require higher interest rates and more disclosure; . that even though the developer will plan to build the infrastructure and then be reimbursed through the CFD proceeds, the developer as well is expecting to have those improvements acquired from him in increments; that the developer has had the ability to complete the improvements for a couple of years; that the most amount of work completed to date has been with regard to grading, portions of Murrieta Hot Springs Road have been built, and some utilities for Murrieta Hot Springs Road have been installed; but most of the other public infrastructure improvements, priority to the City and the Development Agreement, have not been completed, needed right of way has not been secured, and plans have not been signed by the various agencies approving those plans; . That the developer has several bank loans that are being utilized for these improvements and that it is common for these large developments to have equity of a developer and to have bank loans secured by the equity and that the land is the ultimate security and that the City's policy grants a 3: 1 value to lien ratio; · That the Consultant Team's role is to function as the City's Financial Advisor - an extension of staff and to assist them in the expertise of land secured financings; that Bond Counsel provides the legal opinion necessary to issue tax-exempt bonds and required legal documentation; that Disclosure Counsel documents the Roripaugh Ranch for the bond holders to understand the development, associated risk, and description of the development; that the Team as well includes the Underwriter of the bonds and the Appraiser for the property. It was noted that market absorption work to evaluate the price points of the development to evaluate the absorption of the units within the development based upon assumptions under the Development Agreement and that because some of these assumptions have changed, it will require an updated market absorption report and the appraisal because it could have an impact on the value of the property; . That at this time because the infrastructure has not moved forward and, therefore, the building permit issuance has changed, the market absorption analysis must be reassessed as well as the value of the property and the information must then be documented in a concise manner in order to present to the City Council a Preliminary Official Statement/Offering Statement; · That other than improvements on Murrieta Hot Springs Road, only grading has been completed on Butterfield Stage Road and that the City would not be in a position to acquire any of those works of improvements; · That bonds could be issued and the money could be placed in escrow but not all monies would go to the developer because these discreet portions of the project have not been completed; · That a Special Tax would be levied against each property within the CFD and that this Special Tax would be levied against property within the boundaries of the CFD; R:IMinutesl0308o5 13 I I I · That, as per Proposition No. 218, a vote reflected two-thirds in favor of the Special Tax; that the merchant builders had not submitted a ballot for that vote; therefore, the merchant builders' property would be bound by the Special Tax; . That when bonds are sold, a certain amount of capitalized interest would be specified; that once that amount has been relinquished, one must levy against the Special Tax against properties within the CFD; . That although possible, it would be very impractical for a developer with a 10-year Development Agreement to get bonds issued and to not proceed with the development/improvements until the ninth year of the Development Agreement because that CFD Tax will be levied and if properties are not turned and income were not generated, a default would occur or the property owners would be paying more cash than what was originally paid for the properties; . That in the Preliminary Official Statement, the developer would have made representations of a public improvements schedule and to allow the issuance of the building permits. MOTION: Councilman Washington moved to extend this meeting to 10:20 P.M. The motion was seconded by Councilwoman Edwards and voice vote reflected unanimous approval. Contrary to Council's belief, Mr. Peter Olah, representing Ashby USA, advised, by an entitlement schedule of each facility (copies submitted to the Council), that infrastructure improvements have started, noting the following: . That the CFD facilities are mainly Butterfield Stage Road, Murrieta Hot Springs Road, the two roads within the Village Core area, part of the north and south loop road, the 20- acre sports park, the 5-acre neighborhood park, improvements to Nicolas Road/Calle Chapos, off-site improvements on Winchester Road and Nicolas Road, and improvements to Nicolas Road and Calle Girasol, and two major flood zone improvements; · That more than 12 million yards of earth have been moved; that the developer is currently under contract to grade Butterfield Stage Road; that Murrieta Hot Springs is completely to grade; that with regard to the two roads within the Village Core, the developer is under contract to provide those improvements with subcontractors - have gone to public bid and have awarded the contract; that the recent rains have impacted the start of that work; that Butterfield Stage Road, within the Tract boundary, is approximately 60% up to grade - that rains have delayed this process as well; that the developer has as well gone out to bid and awarded a contract to complete the sewer and water throughout the CFD - again because of the recent rains, work has been delayed; · That within three weeks, with no rain, Butterfield Stage Road could be completely graded; that a bid package has been submitted to the Public Works Department for approval for the grading of the southern portion of Butterfield Stage Road to Rancho California Road; that with the exception of two property owners, agreements have been reached for needed easements to build the roadway; that negotiations are continuing in an effort to obtain these last two easements on Butterfield Stage Road easterly side north of Rancho California Road; R:\MinutesI030805 14 I I I · that it would be the developer's intent to have all the above-mentioned facilities under contract as soon as possible; that over $70 million has been spent to date on this project; that approximately $20 million has been expen~ed on CFD facilities; · that on Murrieta Hot Springs Road, the storm drain system has been installed and that the Rancho California Water District facility has been installed. Providing an overview of the developer's efforts to assist the builders, Mr. Kevin Everett, representing Ashby USA, noted the following: · that by the 108th building permit, the bridges on Butterfield Stage Road should be completed; that approximately a week ago, received approval for the entitlements to build these bridges; · that four of the five builders have agreed to accept 515 unimpeded permits; that this has not been negotiated with staff; that CFD funding requirements would be achieved and builder litigation would be removed. Introducing the other builders in attendance, Mr. Phillip Broderick, representing Griffin Communities, stated the following: · that the builders purchased the land; that Final Maps were approved; that Improvement Plans were approved; that most builders have installed all off-site improvements; that the house plan approval through the City was exhaustive; · that the builders are not willing to pay the cost of the CFD every year while awaiting the opportunity to build homes; · that Griffin Communities filed the lawsuit; that there is a desire to resolve this matter but the CFD must fund and the improvements must be completed; · that due the rain, erosion has created the need to fix the .Iots which has resulted in an additional expense; · that builders have existing loans; that because of the delays, these loans are now due. Considering the Development Agreement that was in place when the builder purchased the property from the developer and considering the building permit issuance schedule was workable at that time, Mayor Comerchero questioned why the building permit issuance schedule is not workable at this time. In response to Mayor Comerchero, Mr. Broderick advised that the property was in escrow prior to the execution of the Development Agreement and that it was anticipated by the builders that these improvements would be completed. In light of City Attorney Thorson's thorough explanation, Councilman Washington suggested that a more productive process be established to resolve this matter and that the existing subcommittee meet with staff and those involved MOTION: Councilman Washington moved to extend this meeting to 10:45 P.M. The motion was seconded by Councilwoman Edwards and voice vote reflected unanimous approval. R:IMinutesl0308o5 15 I I I Mayor Comerchero noted that the subcommittee (comprised of Mayor Comerchero and Mayor Pro Tern Roberts) has discussed this matter. Councilman Naggar advised that he had requested this matter to be placed on the agenda because he was receiving conflicting information and that he wanted for himself as well as the Council to obtain accurate information. Summarizing the information received this evening, Councilman Naggar noted that the Master Development Team needs to give a written commitment as to when all improvements that are the developer's obligation will be completed; that once the commitment has been given, the developer should be held accountable; and that the merchant builder should remove the lawsuit. In response to Mayor Comerchero's requested clarification, the Council confirmed that there shall be no compromise on the building permit schedule. Noting that there would be no room for compromise on a previously agreed to Development Agreement and the premise of the agreement, Councilman Washington expressed his support of that Agreement but relayed frustration with having to readdress this matter. Appreciating the strong message sent by the City Council, City Manager Nelson reiterated the message sent by the City Council with regard to the existing Development Agreement and that the existing performance requirements must be completed with respect to the infrastructure improvements. MOTION: Councilman Naggar moved to receive and file this item. The motion was seconded by Mayor Pro Tern Roberts and voice vote reflected unanimous approval. 19 Jefferson Avenue Pavement Rehabilitation - Phase 11- PW02-26 - Construction Contract RECOMMENDATION: 19.1 Provide direction to staff regarding the continuation of Jefferson Avenue Pavement Rehabilitation - Phase II - Project No. PW02-26. Public Works Director Hughes provided the staff report (as per agenda material), highlighting the revised recommendation to cancel the existing contract for convenience and to settle outstanding contract issues in the amount of $300,000, advising that a new contract will be forwarded to the City Council. MOTION: Councilman Washington moved to cancel the existing contract for convenience and to settle outstanding contract issues in the amount of $300,000. The motion was seconded by Mayor Pro Tern Roberts and voice vote reflected unanimous approval. CITY MANAGER'S REPORT No additional comment. CITY ATTORNEY'S REPORT City Attorney Thorson advised that there were no reportable items from Closed Session, noting that Item No. 19 was discussed in Closed Session and was dealt with in Open Session. R:\MinutesI0308o5 16 I I I ADJOURNMENT At 10:34 P.M., the City Council meeting was formally adjourned to a regular meeting on Tuesday, March 22, 2005, at 7:00 P.M., in the City Council Chambers, 43200 Business Park Drive, Temecula, California. ATTEST: R:IMinutesl0308o5 17