REPORT TO COUNCIL
SUBJECT
Title
Action to Authorize the City Manager to Execute an Agreement with Santa Clara Pacific Associates L.P. (“Developer”) for the Installation and Operation of Private Recreational Amenity Improvements to Satisfy a Portion of Developer’s Parkland Obligations for the 200 Affordable Unit Apartment Project located at 80 Saratoga Avenue, such Improvements to be Funded at Developer’s Sole Cost
Report
COUNCIL PILLAR
Enhance Community Sports, Recreational and Arts Assets
Enhance Community Engagement and Transparency
Deliver and Enhance High Quality Efficient Services and Infrastructure
BACKGROUND
In July 2014, the City Council adopted Ordinance No.1937, adding Chapter 17.35 “Park and Recreational Land” to the Santa Clara City Code (SCCC). The purpose of City Code Chapter 17.35 is to help mitigate the impacts of new housing development growth on existing parkland and recreational facilities pursuant to the provisions of the State of California Quimby Act (Quimby) and/or the California Mitigation Fee Act (MFA). New residential developments are required to dedicate developed park and recreational land and/or pay a fee in-lieu of parkland dedication. Under SCCC 17.35.070, developers that provide eligible private recreational space may obtain a fifty percent (50%) credit against the developer’s overall land dedication requirement. The amount of the credit is established by determining the total acreage of proposed private active recreational amenity space and dividing such total acreage by fifty percent (50%). The value of the resulting acreage is determined in accordance with the City’s annual land valuation appraisal resolution and applied as a credit against the developer’s overall land dedication requirement.
On September 14, 2022, the Architectural Review Committee approved a 100% affordable housing development application located at 80 Saratoga Avenue to construct a six-story mixed use development with 200 affordable residential apartment units, parking, landscaping, and site improvements (Project).
The Project will meet its parkland dedication requirements of 1.0608 acres as follows:
1. Installation and maintenance of 0.8077 acres of private recreational amenity improvements which entitles developer to a fifty percent (50%) credit of $2,067,629 against its total parkland dedication requirement; and
2. Payment of $4,639,551 in Mitigation Fee Act parkland in-lieu fees in accordance with City Code Chapter 17.35.
This item requests Council consideration and approval of the Private Recreational Amenity Agreement (Attachment 1) necessary to implement the Project’s overall park and recreational land requirements.
DISCUSSION
In conformance with the City Code, the City and Santa Clara Pacific Associates L.P. (Developer) negotiated the terms and conditions for the construction and the completion of the private recreational amenity improvements of the Private Recreational Amenity Agreement (Agreement). Key provisions of the Agreement include:
1. The Developer will construct and install the private recreational amenity improvements onsite for which credit will be provided in the amount of $2,067,629.
2. The Developer is not eligible for credit for any private recreational improvements which are not completed prior to occupancy and will be required to pay any additional equivalent park in-lieu fees for such improvements.
3. The Developer shall maintain, repair, and replace the private recreational amenity improvements to preserve them from failure or deterioration.
4. The Developer shall submit payment in the amount of $4,639,551 for Mitigation Fee Act in-lieu fees in accordance with City Code Chapter 17.35.
5. The Developer agrees to restrict the use of private recreational improvements for active recreational uses for the benefit of future owners/renters of the residential units.
6. The Agreement includes covenants running with the land and shall be binding upon Developer and Developer’s successors and assigns during the term of their respective ownership of the private recreational improvements.
7. Developer shall furnish a performance security to ensure completion of the private recreational improvements for which Developer will be receiving credit.
As noted above, the Agreement contains provisions that restrict use of the private recreational improvements for recreational purposes only. Such requirement will run with the land and bind Developer and future owners of the property.
ENVIRONMENTAL REVIEW
California Senate Bill 35 (“SB 35”), requires cities to streamline the review and approval of certain qualifying housing projects (Section 65913.4) through a ministerial approval process, exempting such projects from environmental review under the California Environmental Quality Act (“CEQA”). Accordingly, this project is not subject to CEQA review.
FISCAL IMPACT
There is no cost to the City for consideration of the Private Recreational Amenity Agreement with Santa Clara Pacific Associates L.P. The Developer will meet its parkland dedication requirement of 1.0608, or the equivalent fee due in lieu of parkland dedication in the amount of $6,707,180 (includes a 15% credit of $1,183,620 for 100% affordable housing projects), by installing and maintaining private recreational amenity improvements onsite, for which credit will be provided in the amount of $2,067,629, and by submitting Mitigation Fee Act in-lieu fees in the amount of $4,639,551 to be allocated to the Parks and Recreation Capital Fund.
COORDINATION
This report has been coordinated with the City Attorney’s Office, the Community Development Department, the Finance Department, and the City Manager’s Office.
PUBLIC CONTACT
Public contact was made by posting the Council agenda on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615-2220, email clerk@santaclaraca.gov or at the public information desk at any City of Santa Clara public library.
RECOMMENDATION
Recommendation
Authorize the City Manager to negotiate and execute the agreement with Santa Clara Pacific Associates L.P. for the installation of Private Recreational Amenity Improvements at 80 Saratoga Avenue at the Developer’s Sole Cost on substantially the terms and in the forms presented, with such minor, non-substantive changes and amendments that may be necessary to implement the parkland dedication requirements for this project, in final forms approved by the City Attorney.
Staff
Prepared by: Gina Saporito, Staff Analyst
Reviewed by: Damon Sparacino, Director, Parks and Recreation
Approved by: Jovan Grogan, City Manager
ATTACHMENTS
1. Private Recreational Amenity Agreement with Santa Clara Pacific Associates L.P.