Staff report dated October 6, 1999, was presented pertaining to a request to consider a Development Agreement as part of the conditions to rezone the property in the 100 and 200 blocks of East Truslow and Walnut Avenues from M-G, C-H and R-3 to R-5 (Environmental Impact Report).
Director Dudley reported that in 1989, staff began a process with the Bushala Brothers to develop and 100 and 200 blocks of East Truslow Avenue with a multi-family housing project. As part of that project, an Environmental Impact Report was prepared, along with a General Plan rezone of the property. In December 1989, Council certified the EIR, approved the General Plan change to R-5 (high density residential) and had the first reading of the amendment changing the zone designation. One of the concerns regarding the rezone was that the property is comprised of very small lots and, if developed individually to R-5, could result in very high density projects for the area.
The development project did not move forward at that time, and the issue remained dormant until 1996. Staff conducted numerous discussions with the Bushala family about what would be necessary to proceed with the second reading of the rezone amendment. A Development Agreement was prepared which combined all of the parcels, and an R-5 project would be placed on one lot. Staff has reached agreement with the Bushala Brothers on all issues and is now ready to move forward to City Council with a Development Agreement and second reading of the amendment. The only issue remaining pertains to the elementary school district, which has asked that language be added for full mitigation of the development when it occurs. Director Dudley reminded the Commission of an approved project at Brea Boulevard and Bastanchury Road, which also contained issues regarding schools and mitigation. The item went to City Council, which approved the project without an agreement with the school district. It was staff's understanding that Council desires that this not happen in the future; thus staff has advised all developers to work with the school district to resolve any outstanding issues.
Staff has proposed language in the Development Agreement which states that a written agreement with the school district must occur before the onset of public hearings to consider approval of a development agreement. The school district has provided additional language to be included in the agreement, and a school board representative will speak on its behalf. There are legal questions regarding the school district's legal rights and the City's position, and Council will make the ultimate decision as to what language will be included in the Development Agreement. Staff recommended that the Planning Commission certify the Environmental Impact Report, and recommended that the City Council approve the Development Agreement, including all amendments listed in the staff report, and that the second reading of the rezone amendment be held.
Commissioner Munson asked if, from a planning standpoint, an R-5 development would be reasonable for this area. Director Dudley answered that, while he had reservations about the project presented in 1989, he was unsure whether this would ultimately be the project presented to staff. He added that R-5 developments are difficult and must be reviewed critically to ensure that all issues are addressed.
Commissioner Ballard suggested the following changes to the Development Agreement:
Public hearing opened.
- Page 3, Article 6.1
States that the Landowner shall have the option to extend this Agreement for an additional seven (7) years. It does not say how or when they exercise this option, and this should be included.
- Page 5, Article 6.1
States that this shall be developed as a single-development project. Does this mean that it can be developed in phases? Director Dudley stated that the development project may be developed in phases, if it meets the City's code.
Also in this paragraph, it states that an application for the Development Project will only be accepted as complete if it is consistent with all federal, state and local laws'.. Insert the words "applicable at the time."
- Page 5, Article 6.2
States ''Development Project and related development approvals, subdivision, tract or parcel map'.. Suggested that staff add the term "lot consolidations."
- Page 5, Article 11
States that the City and Landowner shall review this Agreement at least once every twelve (12) months''.each party is required to demonstrate good faith compliance with the terms of this Agreement''. How would this be accomplished? Director Dudley indicated that this was language required by state law.
- Page 5, Paragraph 14
Notices shall be delivered in writing in person and deposited in the U.S. mail, postage prepaid, certified, registered return receipt requested'.. Why should these be delivered personally and by mail? Mail should be sufficient. Also, certified and registered mail are two different things, so one term should be removed. Also, the City's zip code is incorrect.
- Page 6, Article 16.2
Upon assignment of this Agreement, the landowner shall be released from obligations. It does not require the Assignee to assume liability, so they should be required to assume the agreement in writing.
- Last page
There should be a subordination of all lenders before the Agreement is recorded.
Wayne Wedin, 417 Associated Road, Brea, introduced Tony and George Bushala, applicants, as well as Dennis O'Neill, legal counsel. He explained that the General Plan designation for this area is high density, multi-family residential, and this action will make zoning for this property consistent with the General Plan. The proposal will also provide a substantial upgrade to the area, and Mr. Wedin indicated that he has received encouragement from persons in the community to move forward quickly with this project. It was also his understanding that this proposal is consistent with the approved Transportation Center Study which has been heard by both the Planning Commission and the City Council. Mr. Wedin distributed a document entitled Supporting Documentation for Amendment A-1381 and DA-99-2 to the Commission.
Dennis O'Neill, Hewett & McGuire, Irvine, acknowledged the suggested modifications by Commissioner Ballard and will incorporate them into the agreements. He referenced Senate Bill 50, which was adopted last year. This bill significantly changed the law for funding of new school construction, however there is no provision requiring that the developer must mandatorily meet with the school district and arrange to pay fees before any project documents are finalized. He felt that this issue would best be decided by the City Attorney, and asked that the Planning Commission recommend to the City Council that a second reading of the amendment be heard.
Mr. Wedin wished the record to reflect that he personally had spoken with the high school district, and there were no outstanding issues to be resolved. He would continue to work with the elementary school district to assist in funding efforts. He noted a minor change on the plan-parcel 29 was missing from the first map, and there was no zoning designation for the Edison property. He was confident, however, that these two clerical corrections did not change the intent of the agreement.
Commissioner Ballard also desired to go on record stating that the supporting documentation received from the applicant would not be a part of this meeting because the Commission had not had the time to review it. Mr. Wedin indicated that he understood that point. Director Dudley added that the Commission and staff would be referring to the property described in the legal description provided by the applicant.
Patricia Godfrey, Assistant Superintendent for the Fullerton Elementary School District, introduced Benjamin Dolinka, consultant for facility funding and student demographics. She added that another member of the Board of Trustees, the principal of Maple School, and several Maple parents were also in attendance. She requested that the Planning Commission recommend an amended Development Agreement to the City Council, amending Section 10 for school facilities mitigation. The current language in the Development Agreement only requires the developer to meet with the school district. She felt that only meeting with the district would not assist the school in providing the proper level of facilities for the students generated by this project. She asked that language be added (as provided to staff by the school district) requiring the developer to reach a written agreement with the school district prior to any public hearings.
Benjamin Dolinka, consultant from Newport Beach, reported that because this project was first heard in 1989, the school district was concerned that before a project is built, it may be another ten years. The trilogy of court cases suspended by SB 50 were only suspended until January 1, 2006. At that point in time, the laws as they relate to school fee mitigation, will be unknown. He noted that the school district has met with a representative of the Bushala Brothers, and at that meeting, the present language was drafted. He reminded the Commission that the school district is not requesting denial of a proposed project, rather approval of a Development Agreement with proper mitigation for school facilities. Since the approval of the agreement for the Braemar development at Brea Boulevard and Bastanchury Road, and passage of Prop 1A, the district has also entered into an agreement with the Van Daele Development Corporation, for the 92-lot subdivision on the northwest corner of State College Boulevard and Bastanchury Road.
Commissioner Ranii asked if the property was developed before 2006, would SB 50 and Prop 1A take precedence? Mr. Dolinka replied that a city cannot deny a project based on school mitigation. If there is no mitigation measure in the Development Agreement, the school district is only authorized to levy the alternative fees which are identified in the school facilities needs analysis.
Commissioner Simons questioned what the specific fee would be. Mr. Dolinka answered that the amount the school district imposes for multi-family units is approximately $4,500, the amount to be imposed on the SunCal Development on the Hughes site.
Commissioner Ballard asked if this was the amount provided for in the code. Mr. Dolinka explained that this was greater than the amount that the school district has justified in its alternative school fee analysis. Under this analysis, there are two funds listed: one if the state provides funding and one if it does not. Unfortunately, the school district cannot receive funds from the state, so it may only be permitted to charge 50% of the impact as viewed by the state. Commissioner Ballard read the following excerpt from the code: "'. a fee for the construction or reconstruction of school facilities may not be levied or imposed in connection with, or made a condition of, any legislative or adjudicative act or both." Mr. Dolinka reminded him that because the attorneys for the school district were not present, this matter could be brought forth at the City Council meeting. In concluding, Mr. Dolinka expressed the district's concern that this project may not be built until January 2006. Thereafter, if language is not place in the agreement, they may not be permitted to collect the fees or mitigation payments, because there may not be any legislative act to allow them to have a development project denied at City Council level.
Commissioner Munson wished clarification on the fee the developer would be paying. Mr. Dolinka explained that under SB 50, and the document approved by the school board, they may charge $1.38/square foot when the state has new construction funds available. When the state does not have available funds, the school may charge $2.76/square foot. The $4,500/unit amount is what the district believes is the true impact of multi-family attached units on this property.
Mr. O'Neill again spoke and was of the opinion that the most appropriate time to discuss what the fee shall be would be when an actual project is brought before the Planning Commission and City Council. He emphasized that most developers are well aware of the benefit of having a quality school close to a project, and any fees needed to be paid, and the applicants are not disputing that point. Also, of the present fee of $1.93/square foot-65% goes to the high school district and the remainder to the elementary school district. Because the elementary school district conducted a needs analysis, they were able to increase their fee slightly.
Public hearing closed.
Director Dudley indicated that the City is now in a position that they did not choose: to be between the district and the developer. There will be a legal opinion prepared for the City Council on this issue. Staff believes that it is following a general direction from the City Council that all parties involved meet to arrive at an mutually-acceptable agreement prior to any public hearing on a specific development project.
Commissioner Munson wished assurance that by requiring an agreement, the City is not requiring that the developer pay a $4,500 fee, and Director Dudley stated that this is what was stated in the staff report. Commissioner Munson favored approval of the Development Agreement, but felt that an R-5 zone designation was too dense for the site. He also did not feel comfortable recommending a set fee to be paid by the developer to the school district, but that only an agreement be reached between the two parties.
Commissioner Ballard, did not wish to recommend approval of the Development Agreement to the City Council. Because the study of this site was 10 years old, many changes have occurred in this area, and he also did not feel that an R-5 designation would be appropriate. He expressed concern about an R-5 development in an area that is already heavily impacted with circulation issues. If the Agreement goes forward to Council, he wished to add to the Planning Commission's recommendation that whatever final agreement is entered into, that it reflect the strongest position of the City, based on legal opinions received, in favor of school mitigation fees. He believed that Maple School would be heavily impacted by such a development, and should not have to depend on state funding.
Commissioner Simons wished to recommend approval of the Development Agreement to the City Council, but make known that the Planning Commission cautions about an R-5 development.
Commissioner Ranii favored both the staff proposal and the R-5 development, because of its close proximity to the downtown. His understanding of an R-5 project is that is must be carefully reviewed by staff, who would study traffic, ingress/egress and other issues. He was confident with staff's recommendation as stated in the staff report.
Vice-Chairman LeQuire also expressed concern about a potential project with an R-5 zone, and the problems which that type of density could generate. He concurred with the school district's issue pertaining to fees and, although many developers pay in excess of what is required by law, he did not wish to see a precedent set that would require all developers to do so. He favored recommending to the City Council approval of the Development Agreement, but without an R-5 project.
Director Dudley pointed out that the Commission was not dealing with an option on the zoning designation in this area, because a first reading on the amendment had already occurred during a public hearing. The Commission had to either recommend approval of the Development Agreement as written, a second motion stating that the Commission feels that R-5 is inappropriate and the Council should review that issue.
MOTION by Commissioner Ballard, seconded and CARRIED unanimously by voting members present, that the final Environmental Impact Report and Addendum update be CERTIFIED. The title of Resolution No. 6845 RECOMMENDING that the City Council not adopt a Development Agreement, as defined by Section 65865.2 of the California Government Code between the City of Fullerton and George and Sylvia Bushala, et al., pertaining to rezoning of property in the 100 and 200 blocks of East Truslow and Walnut Avenues from M-G, C-H and R-3 to R-5, was read and further reading was waived. The title of Resolution No. 6846 REVERSING its previous recommendation that the City Council change the zone classification from M-G, C-H and R-3 to R-5 for properties on the north side of the 100 and 200 blocks of East Truslow Avenue and the south side of the 100 block of East Walnut Avenue as shown on the attached map, was read and further reading was waived. MOTION by Commissioner Ballard, seconded and CARRIED by a four-to-one vote, with Commissioner Ranii voting no, that said Resolutions be ADOPTED AS WRITTEN.
Vice-Chairman LeQuire announced that this matter will be heard by the City Council on November 16, 1999.