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REQUEST FOR COUNCIL ACTION Date: 04/22/2013 Item No.: 7.i Department Approval City Manager Approval Item Description: Approve the Negotiated Settlement of Park Dedication Fees for the Sienna Green II Development B ACKGROUND 1 As part of the Sienna Green II housing development, it was expected that park dedication fees 2 would be paid for the project in the amount of $150,000 (50 units x $3000/unit). The project 3 was a Planned Unit Development (PUD) and the project was to be phased in over a period of 4 years, with the renovation of the existing 160 units occurring first and the new building (second 5 phase) occurring in a couple of years once funding was secured. Since the first phase was 6 rehabbing existing units, there were not any park dedication fees due. It was intended that once 7 the second phase moved forward that park dedication would be paid at time of the building 8 permit. Unfortunately, the PUD approved in June of 2009 did not contain any language 9 regarding park dedication. In addition the Public Improvement Contract between the City and 10 AEON, also executed in November of 2009, said that no park dedication was due (since none 11 was at the time). 12 13 Once funding was secured for the second phase in 2011, staff informed AEON that park 14 dedication was due prior to the release of the building permit in the amount of $150,000. AEON 15 did not believe that they owed any park dedication for the project since the PUD Agreement was 16 silent on the matter and the Public Improvement Contract stated the park dedication was zero. 17 The confusion of the documents (as well as turnover in AEON staff from when the project was 18 originally approved) led AEON to believe that they did not owe any park dedication. 19 Staff and representatives of AEON held several meetings to try to resolve the park dedication 20 issue. So as to not delay construction of the project, it was decided that AEON would deposit 21 $150,000 with the City and the building permit would be released. The $150,000 payment was 22 to be held in escrow to allow for some more discussion on the matter. 23 24 In the ensuing time, the project has been completed and the City still retains the $150,000 in 25 escrow. Once the project was complete, AEON asked for the full refund of the payment. Staff 26 and AEON again met several times in an effort to resolve the matter. In due consideration of the 27 situation, the project, and facts of the case, staff and AEON have agreed that $75,000 would be 28 retained by the City for park dedication purposes and $75,000 returned to AEON. 29 While the City is interested in maximizing the collection of park dedication funds, staff 30 considered the following factors in the process of developing this recommendation: 31 32 1) Sienna Green is an affordable housing project that is meeting defined housing needs in 33 our community (50 affordable family housing units with 2-3 bedrooms) and was a top 34 Page 1 of 2