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2007/05/22 City Council Resolution 2007-84RESOLUTION NO. 2007-84 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ROHNERT PARK AUTHORIZING AND APPROVING A REIMBURSEMENT AGREEMENT BETWEEN THE CITY OF ROHNERT PARK AND THE NORTHEAST SPECIFIC PLAN PROPONENTS WHEREAS, the City of Rohnert Park ( "City ") is in the process of reviewing the Northeast Specific Plan application, which requires a number of project approvals and associated documents; and WHEREAS, the City has prepared a Public Facilities Finance Plan and Water Supply assessment, which were necessitated in part by the Northeast Specific Plan application; and WHEREAS, the active proponents of the Northeast Specific 'Plan 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 22nd day of May, 2007. ATTEST: Deputy City Clerk CITY OF ROHNERT PARK Mayor BREEZE: AYE MACKENZIE: AYE SMITH: AYE STAFFORD: AYE VIDAK- MARTINEZ: AYE AYES: (5) NOES: (0) ABSENT: (0) ABSTAIN: (0) REIMBURSEMENT AGREEMENT RELATED TO THE NORTHEAST SPECIFIC PLAN THIS REIMBURSEMENT AGREEMENT (the "Agreement ") is made and entered into as of , 2007, by and among the City of Rohnert Park ( "City "), a municipal corporation, and BHI -PHI Partners, a California general partnership ( "BHI - PHI"), TNK Ryder, LP, a California limited partnership ( "Ryder "), Tatman BGR LLC, a California limited liability company ( "Tatman "), Eastern Development Corporation, a California corporation ( "Eastern "), the Albert A. Bendelac & Cynthia Beilig Bendelac 1999 Trust (`Bendelac Trust "), and the Keith Hall 1993 Revocable Living Trust ( "Hall Trust ") (BHI -PHI, Ryder, Tatman, Eastern, Bendelac Trust and Hall Trust also referred to individually and together as "Developer "). RECITALS A. Developer has submitted applications for development of various aspects of the Northeast Specific Plan (the "Proposed Project "). The Proposed Project requires or contemplates the following approvals, documents and processing activities (collectively, "Project Approvals "): (1) General Plan Amendment; (2) Specific Plan; (3) Development Plans; (4) Subdivision maps; (5) An EIR for the Proposed Project; (6) Annexation; (7) Development Agreement; and (8) Any other approvals, documents or processing reasonably necessary to develop the Proposed Project. B. In addition to the Project Approvals, the Proposed Project, along with other concurrent and future development projects within the City, required the preparation and approval of the Public Facilities Financing Plan ( "PFFP ") and Water Supply Assessment ( "WSA ") existing on the date of this Agreement. C. Implementation of the Proposed Project, processing of the Project Approvals, and preparation and approval of any future revisions of or updates to the WSA and PFFP will require City to incur various costs and expenses including staff processing, consultant costs, and legal fees and costs. D. In order to facilitate processing of the Project Approvals, and to induce City to commence negotiation and drafting of the Development Agreement, Developer desires to reimburse City for its costs in connection with the Project Approvals and Developer's fair share of WSA preparation and updates. 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 costs directly or indirectly incurred by City in connection with the Project Approvals and Developer's fair share of WSA and PFFP preparation, updates and legal defense. Z. Developer Reimbursement Obligation. Developer shall reimburse the City for the following costs (collectively, the "Eligible Costs ") incurred in connection with the Project Approvals, WSA and PFFP: (a) City staff time, processing costs, consultant costs and legal fees associated with all 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; and (d) with respect to the WSA and PFFP: (i) Developer's fair share (to be determined by City but not to exceed one third (1/3)) of the consultant costs and attorneys fees (including payment of third -party legal fees) incurred by City in connection with preparation, adoption and defense of the WSA and /or the PFFP; (ii) Developer's fair share (to be determined by City but not to exceed one - third (1/3)) of the consultant costs and legal fees incurred by City in connection with the readoption of the WSA in response to any final court judgment or writ issued as a result of a third -party challenge, provided that readoption is for the same projects addressed in the WSA. If the Water Supply Assessment proposed for readoption is not for the same projects as the current NO 103001/548842 -1 2 WSA, then Developer will pay its fair share of such readoption costs if readoption of the Water Supply Assessment is a legal prerequisite for any Project Approvals; and (iii) Developer's fair share (to be determined by City but not to exceed one - third (1/3)) of the consultant costs and legal fees incurred by City in connection with reapproval or amendment of the PFFP in response to any final court judgment or writ issued as a result of a third -party challenge, provided that reapproval or amendment is for the same projects addressed in the current PFFP. If the Public Facilities Financing Plan proposed for reapproval or amendment is not for the same projects as the current PFFP, then Developer will pay its fair share (to be determined by the City but not to exceed one -third (1/3)) of such reapproval or amendment costs if reapproval or amendment of the Public Facilities Financing Plan is a legal prerequisite for any Project Approvals. (e) The percentage allocations in any subparagraph of section 2(d) above are the result of a negotiated compromise for this one Agreement only, and do not represent any party's determination of fair share allocations of costs. The fact that either or both parties have agreed to these allocations in the Agreement shall not be relevant to any future determination of fair share, or reasonable relationship, regarding processing, infrastructure or any other cost or fee allocations. (0 City shall not be obligated to incur any such Eligible Costs if Developer fails to timely reimburse City as provided in Section 3 below. The parties agree that the Development Agreement, if approved, will provide a mechanism for potential reimbursement of a pro rata portion of the costs allocable to preparation of the Northeast Specific Plan and EIR from other property owners within the Northeast Specific Plan area as such other properties are developed. 3. Payment of Eligible Costs. 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 5 allowing for withdrawals from the Deposit in lieu of Developer making such payments. (a) City acknowledges that as of the date of this Agreement Developer already has contributed certain sums toward City's costs related to the WSA and the PFFP, and Developer already has paid certain sums for the consultant's fee to prepare an EIR for the Proposed Project and for City's administrative expenses and other Eligible Costs incurred in connection with the Project Approvals. (b) City also acknowledges that as of the date of this Agreement Developer has contributed Three Hundred Sixty Eight Thousand Two Hundred Seventy Eight Dollars and Thirty Cents ($368,278.30) toward City's costs related to designing the East Side Trunk Sewer intended to serve the eastern side of Rohnert Park, including the Northeast Specific Plan area, as called for in the PFFP. City acknowledges and agrees that Developer's contribution is not a gift to City but rather shall be treated as a prepayment of PFFP payments otherwise due from the Proposed Project, and Developer shall be entitled to reimbursement of this contribution or credit NOL0300 1/548842 -1 3 for this contribution at a time and in a manner to be determined; provided, nothing in this Agreement shall be interpreted as guaranteeing construction or funding of the East Side Trunk Sewer, guaranteeing reimbursement by the City's general fund, or otherwise limit City's discretion regarding any decisions, approvals or environmental reviews related thereto. Developer's right to recover this contribution as described in this subsection (b) shall survive the expiration or termination of this Agreement or the withdrawal of members of Developer from this Agreement, and shall survive in the event City denies the Proposed Project. 4. Post - 2005 -2006 PFFP Updates. Any revisions to the. PFFP processed or adopted after adoption of the 2005 -2006 PFFP Update shall include the fees to be charged for consultant costs and legal fees incurred by City. Accordingly, Developer shall not be obligated to pay such costs except in connection with payment of fees pursuant to such revisions to the PFFP. 5. Deposit. (a) As a condition to City signing 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 3 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. (b) City shall continue withdrawing funds from the Deposit until the Deposit has been reduced to Ten Thousand Dollars ($10,000), at which time City shall notify Developer in writing that the Deposit has been so reduced, and the Developer shall thereafter have twenty (20) days to deposit with City, in cash, an amount necessary to restore the Deposit to its full 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. (c) Developer agrees that if the Deposit amount is reduced to zero dollars, City shall have no obligation to continue processing the Proposed Project or to incur any additional Eligible Costs until the Deposit is restored to its full amount. Developer further covenants and agrees that, if, as a, result of reduction of the Deposit to zero dollars, City ceases processing the Proposed Project applications, Developer shall not at any time, directly or indirectly initiate any litigation against City or its employees, agents, or volunteers for the failure to process or delay in processing such applications during the time between reduction of the Deposit amount to zero dollars and its restoration to its full amount. (d) If two or more of the entities which makeup the Developer withdraw as provided in Section 8 below, the minimum Deposit balance triggering the requirement to replenish the Deposit pursuant to subsection (b) above shall be increased from Ten Thousand Dollars ($10,000) to Twenty Five Thousand Dollars ($25,000). If this Agreement is terminated as provided in Section 8 below, City shall return to Developer within 30 days following the N0103001/548842-1 4 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. 6. 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 final 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 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 into the proposed Development Agreement. 7. Indemnity. Developer shall defend (with counsel approved by City, which such approval not to 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's indemnity obligations under this Section 7 shall survive the expiration or termination of this Agreement, but cease in the event City denies the Proposed Project. This Section 7 shall not apply to Developer's obligations regarding the WSA or the PFFP, which shall be governed solely by Section 2(d). 8. Termination and Withdrawal. (a) Developer may terminate this Agreement by providing 10 days' written notice to City signed by either (i) all the members of Developer who have not previously withdrawn from this Agreement, or (ii) Developer's Agent, David Dolter; AICP. Developer may designate a new agent from time to time in written notice to the City signed by a majority of the members of Developer who have not previously withdrawn from this Agreement. (b) Any one or more individual members of Developer may withdraw from this Agreement by providing 10 days' written notice to City; provided, said withdrawing Developers shall remain jointly and severally liable for payment of all Eligible Expenses incurred prior to the effective date of the withdrawal. (c) 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. (d) Developer shall be responsible for the payment of Eligible Costs incurred by City up to and including the date of termination. N0103001/548842 -1 5 9. Cessation of Processin ?. 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 Developers' 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 volunteers for the failure to process or delay in processing such applications following such Agreement termination. 10. 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. 11. Joint and Several Liability. The obligations imposed under this Agreement shall be joint and several as to each and every person signing this Agreement as Developer. 12. Entire Agreement. This Agreement 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. 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 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: N0103001/548842 -1 6 To the Developer: LEGACY LAND STRATEGIES, INC. 383 Diablo Road, Suite 100 Danville, CA 94526 Attn: David Dolter, AICP - Principal Tel: (925) 766 -6160 Fax: (925) 837 -0216 with a copy to: Archer Norris 2033 North Main Street, Suite 800 Walnut Creek, CA 94596 Attn: Edward Shaffer Tel: (925) 930 -6600 (x209) Fax: (925) 930 -6620 To the City: City of Rohnert Park 6750 Commerce Blvd. Rohnert Park, CA 94928 Attn: City Manager Tel: (707) 588 -2223 Fax: (707) 588 -2274 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 Section 18. 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. N0103001/548842- t 7 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. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.] N0 (03001/548842 -t 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 Stephen Donley, City Manager Approved as to Form: McDonough Holland & Allen, PC City Attorney DEVELOPER: BHI -PHI Partners dba Rivendale Communities, a California general partnership By: Pavillion Homes, Inc., a California corporation Its General Partner C Chris Peterson, President and Assistant Secretary By: Benjamin Homes, Inc., a California corporation Its General Partner C S William Benjamin, President Terri Benjamin, Secretary N0103001/548842 -1 9 TNK Ryder, LP, a California limited partnership : Jay Ryder, General Partner Tatman BGR LLC, a California limited liability company itz Gary Tatman, Managing Partner Eastern Development Corporation, a California corporation M. Arthur Ang, President Albert A. Bendelac & Cynthia Beilig Bendelac 1999 Trust : Cynthia Beilig Bendelac, Trustee Keith Hall 1993 Revocable Living Trust : Keith Hall, Trustee N010300 t /548842 -1 to