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2010/02/23 City Council Resolution 2010-14RESOLUTION NO. 2010-14 A RESOLUTION OF THE CITY COUNCIL OF THE .CITY OF ROHNERT PARK APPROVING A REIMBURSEMENT AGREEMENT BETWEEN THE CITY OF ROHNERT PARK AND SONOMA MOUNTAIN VILLAGE, LLC WHEREAS, the City of Rohnert Park ( "City ") is in the process of reviewing the Sonoma Mountain Village Project application, which requires a number of project approvals and associated documents; WHEREAS, the City has prepared a Public Facilities Finance Plan and Water Supply assessment, which were necessitated in part by the Sonoma Mountain Village Project application; and WHEREAS, the active proponents of the Sonoma Mountain Village Project application have agreed to fund the City's efforts in processing their application, and to fund their fair share of the Public Facilities Financing Plan and Water Supply Assessment costs, including future amendments and legal costs. NOW THEREFORE BE IT RESOLVED by the City Council that the City Manager is hereby authorized and directed to execute the attached agreement in substantially similar form, for and on behalf of the City, including authorization for staff to make minor adjustments in this agreement with City Attorney review and approval. DULY AND REGULARLY ADOPTED on this 23d day of February, 2010, by the City Council of the City of Rohnert Park. CITY OF ROHNERT PARK Mayor BELFORTE: AYE BREEZE: AYE CALLINAN: AYE MACKENZIE: AYE STAFFORD: AYE AYES: (5) NOES: (0) ABSENT: (0) ABSTAIN: (0) REIMBURSEMENT AGREEMENT THIS REIMBURSEMENT AGREEMENT (the "Agreement ") is made and entered into as of the day of 2010, by and among the CITY OF ROHNERT PARK ("City "), a municipal corporation, and SONOMA MOUNTAIN VILLAGE, LLC, a California limited liability company ( "Developer "). RECITALS A. Developer has submitted an application for development of various aspects of the Sonoma Mountain Village Planned Development (the "Proposed Project "). Development of the Proposed Project requires or contemplates the following approvals, documents and processing activities (collectively, "Project Approvals "): (1) General Plan Amendment; (2) Planned Development (P -D) application; (3) Subdivision maps; (4) An EIR for the Proposed Project; (5) Development Agreement; (6) Zoning Code Amendment; and (7) Any other approvals, documents, including Design Guidelines, or processing reasonably necessary to develop the Proposed Project; B. In addition to the Project Approvals, the Proposed Project requires the preparation and approval of a Public Facilities Financing Plan ( "PFFP ") and Water Supply Assessment ( "WSA ") to include the Proposed Project. C. Prior to the execution of this Agreement, City and Developer had an Informal Reimbursement Agreement ( "IRA ") pursuant to which City has been processing the Proposed Project and billing Developer for costs incurred therewith, and Developer has reimbursed City for most but not all of such costs. Pursuant to the IRA, Developer has previously paid City $577,655.11 as reimbursement for City's costs incurred in processing the Proposed Project. As of December 31, 2009, City has incurred $618,622.07 in such costs. As of December 31, 2009 Developer owes City $40,966.96 in reimbursement costs pursuant to the IRA. D. Continued processing of the Proposed Project and preparation and approval of any future revisions of or updates to the WSA and PFFP will require City to continue to incur various costs and expenses including, but not limited to, staff time, consultant costs, legal fees and other assorted costs to process the Proposed Project. SMV_Reimbursement_Agreement (MMG REVISIONS 020310) - CLEAN.doc E. In order to facilitate processing of the Project, and to induce City to continue negotiating and drafting the Development Agreement, Developer desires to continue to reimburse City for all of its legal fees, staff time and consultant costs incurred in connection with the Project Approvals, pay for Developer's fair share of WSA and /or PFFP updates (should any be required), and reimburse City for any litigation costs incurred as a result of the processing of the Proposed Project, approval of any Project permits or Development Agreement, or adoption of a WSA and /or PFFP. AGREEMENT In consideration of the foregoing recitals and for other good and valuable consideration, the parties hereby agree as follows: 1. Purpose of Agreement. The purpose of this Agreement is to provide for payment by Developer of all legal, staff and consultant costs directly or indirectly incurred by City in connection with the Project Approvals, including legal defense costs, if any, and Developer's fair share of WSA and /or PFFP updates. Additionally, the purpose of this Agreement is to bring current all outstanding amounts subject to reimbursement pursuant to the IRA. 2. Developer Reimbursement Obligation. Developer shall reimburse the City for the following costs (collectively, the "Eligible Costs ") incurred in connection with the Project Approvals (including any and all staff and or legal costs incurred following Project approval to process the project to completion), PFFP, and WSA: a. City staff time, processing costs, consultant costs (including, but not limited to, wetlands specialists, biologists, landscape architects and other consultants required to review plans and /or designs) and legal fees associated with processing all Project applications, implementing any Project Approvals, including legal fees and costs incurred in connection with the legal defense of any Project Approvals; b. legal fees and costs payable to City's counsel in connection with the negotiation, drafting, implementation and defense of the proposed Development Agreement; c. fees and costs payable to financial consultants or real estate economists retained by the City in connection with the negotiation of the proposed Development Agreement, provided, however, Developer's obligation to pay such financial /economic analysis related costs under this subsection (c) shall not exceed Forty Thousand Dollars ($40,000) unless Developer has first approved in its reasonable discretion the scope of any financial /economic analysis work in excess of such amount; d. fees and costs which, as of December 31, 2009, City has incurred in connection with the IRA but which have either not yet been billed to Developer for reimbursement or which Developer has not yet reimbursed the City. The City has made a good faith estimate to summarize all such fees and costs in the exhibit attached to this Agreement as ATTACHMENT A. The parties acknowledge that the figures on ATTACHMENT A constitute the City's good faith effort to summarize all such fees and costs, and Developer agrees that SMV_Reimbursement_Agreement (MMG REVISIONS 020310) - CLEAN.doc fees or costs which have inadvertently been omitted from ATTACHMENT A, and are subsequently submitted to Developer, shall be construed as Eligible Costs pursuant to this subsection d; e. fees and costs incurred by City between the period of January 1, 2010 to the effective date of this Agreement. The parties acknowledge that: (i) to the extent such fees and costs exist, they have been incurred in connection with the IRA; (ii) City has not yet billed Developer for fees or costs incurred during such period, but Developer's reimbursement of such fees and costs is anticipated pursuant to the IRA; and (iii) as of the effective date of this Agreement, the total amount of such fees and costs has not yet been precisely determined. The parties agree to cooperate in good faith to determine the precise amount of such fees and costs, to coordinate City's billing of such fees and costs, and to coordinate Developer's reimbursement of all such fees and costs; and f. with respect to the WSA and PFFP: Developer's fair share (to be determined by City) of the consultant costs, staff costs, and attorneys fees (including payment of third -party legal fees) incurred by City in connection with the processing and defense of a City -wide WSA and /or City -wide PFFP, provided the WSA and /or PUP include the Proposed Project as a component of a city - wide -scale analysis; ii. Developer's fair share (to be determined by City) of the consultant costs, staff costs, and legal fees incurred by City in connection with the re- adoption of a City -wide WSA or a City -wide PFFP in response to any final court judgment or writ issued as a result of a third -party challenge, provided the WSA and /or PFFP includes the Proposed Project as a component of a city- wide -scale analysis; iii. If a project specific WSA is created for the Proposed Project, Developer shall pay all staff costs, consultant costs and legal fees (including payment of third - party legal fees) incurred by City in connection with the processing of the WSA and, if necessary, any re- adoption of the WSA in response to any final court judgment or writ issued as a result of a third -party challenge. g. City shall not be obligated to incur any such Eligible Costs if Developer fails to timely reimburse City as provided in Section 4 below. 3. City's Good Faith Estimate of Costs. In the interest of providing Developer with an estimate of such fees and costs which have not yet been precisely determined, City shall submit to Developer a good faith estimate of all fees and costs incurred during the month of January 2010 which would be reimbursable by Developer pursuant to this Agreement on or before March 1, 2010. City acknowledges that the purpose of such good faith estimate will be used by Developer as a rough guideline for budgeting future reimbursements for the Project, pursuant to the IRA and this Agreement. SMV_Reimbursement_Agreement (MMG REVISIONS 020310) - CLEAN.doc 4. Payment of Eligible Costs. With the exception of Eligible Costs described on ATTACHMENT A, City shall submit to Developer, not more frequently than monthly, a copy of each invoice, bill, demand or other evidence that the City has incurred Eligible Costs or other reasonable substantiation of such Eligible Costs. Each such invoice, bill, demand, or other evidence of Eligible Costs shall be paid in full by Developer, without deduction or offset, within thirty (30) days after receipt subject to Section 6 allowing for withdrawals from the Deposit in lieu of Developer making such payments. 5. IRA Past Due Amount. The parties acknowledge that, in connection with the IRA, Developer has deposited cash with City which has been used to pay costs previously incurred by City in processing Developer's project. The parties further acknowledge that pursuant to the IRA, the City has incurred Forty Thousand Nine Hundred Sixty -Six Dollars and Ninety -Six cents ($40,966.96) in costs which has not been paid by Developer (" IRA Past Due Amount "). This IRA Past Due Amount shall be paid to City upon signature of this Agreement. 6. Deposit. Upon signature of this Agreement, Developer shall deposit with City the sum of Fifty Thousand Dollars ($50,000) in cash or other immediately available funds ( "Deposit "), as security for Developer's obligation to pay all Eligible Costs, as provided herein. If Developer does not pay when due the full amount of each bill, invoice, demand, or other evidence of Eligible Costs as provided in Section 4 above, then the City is authorized to pay such amount from the Deposit If the City withdraws funds from the Deposit, the City shall notify Developer in writing that it has used the Deposit to pay all or a portion of the bill, invoice, demand or other evidence of Eligible Costs and the Developer shall thereafter have ten (10) days to deposit with City, in cash, an amount necessary to restore the Deposit to an amount of Fifty Thousand Dollars ($50,000). This cycle of withdrawal, notice and replenishment of the Deposit may be repeated from time to time as necessary to cover Developer's share of the Eligible Costs. Developer agrees that if the Deposit amount is reduced to zero or Developer fails to replenish the Deposit upon request by City, City shall have no obligation to continue processing the Proposed Project or to incur any additional Eligible Costs. Developer further covenants and agrees that, if as a result of reduction of the Deposit to zero dollars or failure to replenish, City ceases processing the Proposed Project applications, Developer shall not directly or indirectly initiate any litigation against City or its employees, agents, or volunteers for the failure to process or for delay in processing such applications following such reduction. If this Agreement is terminated as provided in Section 9 below, City shall return to Developer within 30 days following the effective date of termination that portion of the Deposit, if any including interest, that has not been expended or committed by City as provided herein. 7. No Commitment as to Future Approvals. Nothing in this Agreement shall be construed as a commitment to grant or issue any Project Approvals or any other preliminary or formal approvals in connection with the Proposed Project or to enter into the proposed Development Agreement. Developer acknowledges and agrees that nothing in this Agreement limits City's discretion, in any manner, with respect to any aspect of the Proposed Project or the proposed Development SMV_Reimbursement_Agreement (MMG REVISIONS 020310) - CLEAN.doc Agreement. Developer agrees that it shall remain obligated to pay all Eligible Costs, regardless of whether any aspect of the Proposed Project is approved and regardless of whether City and Developer enter 4 i nto the proposed Development Agreement. Notwithstanding the aforementioned, City shall in good faith expeditiously and with all diligence process the Project Approvals. 8. Indemnity. Developer shall defend (with counsel approved by City, which approval shall not be unreasonably withheld), indemnify, and hold harmless the City, its officials, employees, volunteers and agents from and against any and all loss, liability, expenses, claims, costs (including reasonable attorneys fees), suits and damages of every kind nature, and description, directly or indirectly arising from any third party legal challenge to the Project Approvals, or the implementation of this Agreement. Developer may defend against any such third party legal challenge as a Real Party in Interest using counsel of Developer's choice, and Developer and City agree to cooperate in the joint defense of the Project Approvals or the implementation of this Agreement. Developer's indemnity obligations under this Section 8 shall survive the expiration or termination of this Agreement but cease in the event City denies the Proposed Project. This Section 8 shall not apply to Developer's obligations regarding the WSA or the PFFP, which shall be governed solely by Section 2(f). 9. Termination. Developer may terminate this Agreement by providing 10 days' written notice to City. If Developer is in default of any of its obligations under this Agreement and fails to cure such default within 10 days following written notice from City, then the City may terminate this Agreement by notice to Developer and, thereafter, City shall have no further obligation to process applications for the Proposed Project or to continue with negotiation and drafting of the proposed Development Agreement. Developer shall be responsible for the payment of Eligible Costs incurred by City up to and including the date of termination regardless of which party terminates this agreement. 10. Cessation of Processing. Developer acknowledges and agrees that City may cease processing the Proposed Project and all negotiations in connection with the proposed Development Agreement, if this Agreement is terminated by either party following notice and expiration of any applicable cure periods as provided herein, including Developer's non - payment of Eligible Costs. Developer further covenants and agrees that, if, as a result of termination of this Agreement, City ceases processing the Proposed Project applications, Developer shall not directly or indirectly initiate any litigation against City or its employees, agents, or volunteer for the failure to process or for delay in processing such applications following such Agreement termination. 11. Attorneys Fees. If any legal action is brought by either party to interpret or enforce any terms or provisions of this Agreement, the prevailing party shall be entitled to its reasonable attorneys fees and costs. 12. Entire Agreement. This Agreement supersedes the IRA and constitutes the entire agreement of the parties with respect to the matters set forth herein. Any amendments, modifications, or changes to this Agreement shall be in writing and signed by both parties. SMV_Reimbursement_Agreement (MMG REVISIONS 020310) - CLEAN.doc 13. Waivers. Waiver of a breach or default under this Agreement shall not constitute a continuing waiver or a waiver of a subsequent breach of the same or any other provision of this Agreement. 14. Severability. If any provision of this Agreement or the application of any such provision shall be held by a court of competent jurisdiction to be invalid, void or unenforceable to any extent, the remaining provisions of this Agreement and the application thereof shall remain in full force and effect and shall not be affected, impaired or invalidated. 15. CEQA Processing. Developer acknowledges and agrees that the City is the lead agency under CEQA, that the Sonoma Mountain Village EIR must reflect City's independent judgment and that City retains full discretion with respect to all findings to be made in connection therewith. 16. Successors and Assigns. This Agreement shall be binding upon the parties hereto and their respective heirs, legal representatives, successors and assigns. 17. Jurisdiction. This Agreement shall be administered and interpreted under the laws of the State of California without regard to its choice of law rules. Jurisdiction and venue of litigation arising from this Agreement shall be in the County of Sonoma, State of California. 18. Notices. Notices required by this Agreement shall be personally delivered, mailed, postage prepaid, or mailed via nationally recognized overnight courier as follows: To the Developer: Sonoma Mountain Village P.O. Box 3550 Rohnert Park, CA 94928 Attn: Kirstie Moore, Senior Project Manager Tel: (707) 795 -3550 ext. 125 Fax: (707) 665 -2882 with a copy to: Alvarez - Glasman & Colvin 6795 Washington St. Building D - Suite R Yountville, CA 94599 Tel: (707) 542 -4833 Fax: (707) 542 -4839 To the City: SMV_Reimbursement Agreement (MMG REVISIONS 020310) - CLEAN.doc City of Rohnert Park 130 Avram Avenue Rohnert Park, CA 94928 Attn: City Manager. Tel: (707) 588 -2226 Fax: (707)792 -1876 with a copy to: McDonough Holland & Allen PC 1901 Harrison Street, 9th Floor Oakland, CA 94612 Attn: Michelle Marchetta Kenyon Tel: (510) 273 -8780 Fax: (510) 839 -9104 Notices given by personal delivery shall be effective immediately. Notices given by overnight courier shall be effective upon the date of delivery. Notices given by mail shall be deemed to have been delivered five days after having been deposited in the United States mail. Any party may change its address for notice by written notice to the other party in the manner provided in this paragraph 16. 19. Interpretation. The titles to the sections of this Agreement are not a part of this Agreement and shall have no effect upon the construction or interpretation of any part of this Agreement. As used in this Agreement, masculine, feminine or neuter gender and the singular or plural number shall each be deemed to include the others where and when the context so dictates. The word "including" shall be construed as if followed by the words "without limitation." This Agreement is the product of negotiations among the parties, and it shall not be construed as if it had been prepared by one of the parties, but rather as if all of the parties have prepared the same. Any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not apply in interpreting this Agreement. 20. Authority. Each person executing this Agreement covenants and warrants that (i) the party on whose behalf he or she is signing is duly incorporated or otherwise established or formed and validly existing under the laws of its state of incorporation, establishment or formation, (ii) the party has and is duly qualified to do business in California, (iii) the party has full corporate, partnership, trust, association or other power and authority to enter into this Agreement and to perform all of its obligations hereunder, and (iv) each person (and all of the persons if more than one signs) signing this Agreement is duly and validly authorized to do so. 21. Counterparts. This Agreement may be executed in counterparts. 22. Assignment of Claims. To the extent City determines that it may have Claims against any Project Consultant in connection with the Proposed Project, City may, upon written request by Developer, SMV . Reimbursement_Agreement (MMG REVISIONS 020310) - CLEAN.doc assign such Claims to Developer. As used herein, "Project Consultant" means any consultant, contractor, or other third party whose work product gives rise to any Eligible Cost or who is hired by City in connection with the Project Approvals; and "Claims" means any and all claims, potential claims, causes of action, and potential causes of action for breach of contract and /or professional negligence, regardless of whether such claims or causes of action accrue prior to or after the effective date of this Agreement. [REMAINDER OF PAGE LEFT INTENTIONALLY BLANK] SMV_Reimbursement_Agreement (MMG REVISIONS 020310) - CLEAN.doc IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written. CITY: CITY OF ROHNERT PARK, a municipal corporation City Manager APPROVED AS TO FORM: MCDONOUGH HOLLAND AND ALLEN, PC a municipal corporation City Attorney ATTEST: City Clerk DEVELOPER: SONOMA MOUNTAIN VILLAGE, LLC, a California limited liability company -W� M Brad Baker, Chief Executive Officer SMV_Reimbursement_Agreement (MMG REVISIONS 021010) - CLEAN.doc ATTACHMENT A Summary of Outstanding Eligible Costs Pursuant to IRA SMV_Reimbursement_Agreement (MMG REVISIONS 020310) - CLEAN.doc ATTACHMENT A EXPENSE-and PAYMENT /DEPOSIT SUMMARY Sonoma Mountain Village Expenses & Payments /Deposits through 12/31/09 Last updated 1/28/2010 Item DEVELOPMENT PROCESSING Deposited / Paid I Due / (Remaining z)enses to Date to Date Balance) Preliminary Development Plan (PLA20005- 047PD) 617.82 (2,000.00) ($1,382.18) Final Development Plan (PLA2006- 053FPD) 17,012.85 (27,814.11) ($10,801.26) Development Processing and Legal 101,588.11 0.00 $101,588.11 ENVIRONMENTAL IMPACT REPORT EIR + 20% admin + related expenses 499,403.29 (547,841.00) ($48,437.71) 618,622.07 (577,655.11) 40,966.96 Printed 2/11/2010: 10:01 AM