File #: 17-5223   
Type: Ordinance-S Status: Adopted
Meeting Body: City Council Formal Meeting
On agenda: 12/13/2017 Final action: 12/13/2017
Title: Development Agreement with DR Horton Properties, Inc., for Desert Peak Parkway and Other Impact Fee Items (Ordinance S-44149)
District: District 2

Title

Development Agreement with DR Horton Properties, Inc., for Desert Peak Parkway and Other Impact Fee Items (Ordinance S-44149)

 

Description

Request an ordinance to authorize the City Manager, or his designee, to enter into a Development Agreement with DR Horton Properties Inc., (DRH) with the developers of Hillstone, a residential development in the Desert View Village.

 

Report

Summary

The proposed ordinance authorizes the City Manager to execute a Development Agreement with DRH to address a conflict that arises when the City requires new development to provide regional infrastructure improvements that are not anticipated in the City's 10-year Infrastructure Financing Plan (IFP), and as a result are not eligible for impact fee credit pursuant to state law. Hillstone has been required to extend a 20" water transmission main and construct Desert Peak Parkway, a six-lane Major Arterial roadway. These facilities meet the criteria to be included in the respective impact fee programs, however they were not anticipated in the current IFP because the parcel was not expected to develop within the allowable timeframe. To resolve this conflict, staff recommends executing a Development Agreement that incorporates the following items:

 

  • 20" Water Transmission Main: Water Services Department staff determined the water main is not needed to serve the Cave Creek Road / Desert Ridge Area at this time, and could introduce water quality challenges as a result of low water demand in the area. The water main would be removed from the Hillstone development stipulations. Hillstone will pay full water impact fees in effect at the time permits (or water meters) are obtained. Impact fee revenue from the development could be used toward completing the water main when it is needed in the future. There will be no water impact fee credit granted to Hillstone.
  • Right-Of-Way (ROW) and Drainage Facilities: Hillstone will dedicate full ROW, and design and construct full-sized drainage facilities (culverts) crossing the entire ROW.
  • Interim Roadway Improvement: DRH will design, prepare a cost estimate, and construct to City standards an "Interim" roadway with at least one outside vehicle travel lane and one bicycle lane in each direction, with a minimum of 24' of asphalt roadway pavement in each direction.
  • Full-Build Roadway Design and Cost Estimate: DRH will design and prepare a cost estimate for a "Full-Build" roadway with median and three lanes in each direction.
  • Cash Contribution: DRH will make a cash contribution equivalent to the greater of the project's Major Arterial Impact Fee liability, or the cost difference between the Interim and Full-Build roadway.
  • Payment Schedule: The developer will remit payment of the cash contribution in two installments. The first installment will be $500,000 and must be received prior to obtaining any building permits that require payment of Major Arterial Impact Fees. The second installment of $741,448 will cover the remainder of the total cash contributions and must be received prior to exhausting the credit balance (estimated as the 200th unit).
  • Major Arterial Impact Fee Credit: The City will provide Major Arterial Impact Fee Credit equal to the value of cash contribution.
  • Limitations of Cash Contributions: The City will place the cash contribution in a fund dedicated for regional roadway improvements identified in the IFP for the Northwest Impact Fee Area.

 

Financial Impact

The City will receive a cash payment from DRH and provide to DRH the equivalent value in impact fee credit that will reduce the Major Arterial Impact Fees assessed to the development. The cash received will be limited to improving Major Arterial Roadways in the Northeast Development Impact Fee Area.

 

Location

Desert View Village

Northeast Development Impact Fee Area

Council District: 2

 

Department

Responsible Department

This item is submitted by Deputy City Managers Mario Paniagua and Karen Peters, and the Street Transportation, Water Services and Planning and Development departments.