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Home My WebLink AboutR24020 A-C - Reimbursement Agrmnt - Ponderosa Homes II/Sares Regis Group/Rilington Dolce, LLCContract No. R2402OA-C PALM DESERT REDEVELOPMENT AGENCY REQUEST SUBMITTED BY: DATE: CONTENTS: Recommendation: STAFF REPORT REIMBURSEMENT AGREEMENT WITH PONDEROSA HOMES II, INC., SARES-REGIS GROUP, AND RILINGTON DOLCE, LLC DENNIS M. COLEMAN, REDEVELOPMENT/HOUSING FINANCE MANAGER JULY 14, 2005 LETTER FROM DEVELOPERS REGARDING THE UNDERGROUNDING OF TRANSMISSION LINES ON GERALD FORD MAP OF THE AREA By Minute Motion, that the Redevelopment Agency Board direct staff to draft a reimbursement agreement with Ponderosa Homes II, Sares-Regis Group, and Rilington Dolce, LLC and return to the Agency Board for approval. Executive Summary: Staff is seeking approval to draft a reimbursement agreement with the above -mentioned developers to participate in funding the placement of 115 KV transmission lines on a portion of Gerald Ford underground. Discussion: Staff has been working with several developers in the formation of an Assessment District for the Section 29 area. The developments include the Lowe's Hardware, Sares Regis, Ponderosa Homes and Rilington Homes. Staff has discussed the possibility of financial participation of the placement of the 115 KV transmission lines underground. It is staffs belief that this would be the last opportunity to accomplish this, since Gerald Ford is scheduled to be widened as part of the conditions of development. The developers have sent a request asking the City or Redevelopment Agency to participate in the funding of 50% of the total estimated costs. The estimated costs range from $1,625,000 to $2,945,000 with the Agency's share being $812,500 to $1,472,500, if we participate. G.IRDAOennis ColemanIDATA'WP'REPORTS'.Section 29 Undergrounding.wpd Contract No.R24020A-C Staff Report Reimbursement Agreement with Ponderosa Homes, Sares-Regis, and Rilington Dolce LLC Page 2 July 14, 2005 The developers have proposed two methods of reimbursement, one being a reimbursement period of five years after the completion of work, the second being ten years with an interest payment of 5% per annum, after the completion of work. Staff has reviewed both option and is recommending that you direct us to work on the reimbursement agreement utilizing the 10-year option including the 5% per annum interest payment. Submitted By: 4Z) Dennis M. Coleman Redevelopment Finance Manager DMC:mh Approval: 4 . ��4 ;Jurin cCarthy edevelopment Carlos L. O e Executive rector GIRDAIDennis ColemanOATAIWPREPORTSISection 29 Undergroundmg wpd Department Head: David Yrige(yVevelopment/Housing Director of 2- Paul S. Gibson Director of Finance/Treasurer 05/09/2005 13:36 FAX 925 734 9141 PONDEROSA HOMES 16002 Contract No. R2402OA-C May 9, 2005 Mr. Justin McCarthy Assistant City Manager CITY OF PALM DESERT 73 -5 10 Fred Waring Drive Palm Desert, CA 92260 RE: Undergrounding of SCE Transmission Lines, Gerald Ford Drive, Section 29 A.D. Dear Justin: Thank you ::or meeting with our group recently regarding our proposed assessment district and the potential undergrounding of the 1 I5KV transmission lines on Gerald Ford Drive betweep Portola Avenue and Monterey Avenue. We gathered from you that the city is pote:itially interested in providing an incentive to us in form of a cash reimbursement for a portion of the cost to underground these lines. This reimbursement would be formalized in an agreement between the City of Palm Desert (the "City' and the developers proposing to underground the lines along Gerald Ford, namely Pondoersa Homes II, lnc., Rilington Dolce LLC and Sares Regis Group (the "Developers"). The reimburserne-A would be in the form of a cash contribution spread out over a period of time, with int -.rest. To reiterate, the proposed project would underground the 115 KV lines along the entire frontage of C-erald Ford Drive between Portola and Monterey except the Lowes frontage, a total of apl;roximatcly 4,400 lineal feet. According to SCE, preliminary estimates of potential. costs to underground these lines range from $500 to $800 per Iinear foot. This would total between $2,200,000 and .$3,520,000. Offsetting this would be a credit for relocating tht existing poles which is estimated at $25,000 per pole or approximately S575,000. The estimated net cost would then range from $1,625,000 to $2,945,000. We think that this represents an excellent opportunity for the City and the Developers to cooperate towards the betterment of the community. The removal of these transmission lines will provide a permanent benefit to current and future residents of the City of Palm Desert at a current cost which will be far less than the potential future cost, which would fall entirely can the city. Accordingly, we propose that the City commit to funding fifty (50%) percent of the net cost to underground these lines, an obligation which would approximate] it range from $812,500 to $1,472,500. The City would reimburse the Developers, based on the actual cost of the work, over a period of five (5) years, commencing with the completion of the work. AIternatively, the City could choose to 05/09/2005 13:36 FAX 925 734 9141 PONDEROSA HOMES Q oo3 Contract No. R2402OA-C reimburse the Developers over a period of ten. (10) years with the addition of the payment of interest at the rate of five (5%) percent per annum. As discussed previously, this proposal would require a delay to the widening of Gerald Ford Avenue; to the ultimate three lane configuration. Per our conversations with SCE it will take approximately two (2) years from the date of the payment of a design deposit to the completed installation of the facilities. Since we understand that none of our projects requires, for traffic mitigation, the widening of Gerald Ford, this delay should be an acceptable tradeoff for allowing the undergrounding of these facilities to occur. Thank you fur your assistance with this matter. If you have any questions or comments please contact me at your earliest convenience. Sincerely, POND '1;A H MES , INC. i6ffrey C. Schroeder Senior Vice President, Land Acquisition & Planning SAKES REGIS GROUP Greg Albert Vice President RMINGTON DOLCE LLC Miekie L. K.ley President 05/09/2005 13:36 FAX 925 734 9141 PONDEROSA HOMES [a 004 M;3�y,-015-05 1 O : 53A 15; res-Regis 949 833 7742 P.03 Contract No. R2402OA-C reimburse the :Developers over a period of ten (10) years Kith the addition of the payment of interest at the rate of five (5%) percent per annum. As discussed previously, this proposal would require a delay to the widening of Gerald Ford Avenue -,o the ultimate three lane configuration. Per our conversations with SCE it will take approximately two (2) years from the date of the payment of a design deposit to the completed installation of the facilities. Since we understand that none of our projects requires, for traffic mitigation, the widening of Gerald Ford, this delay should be an acceptable trat:leoff for allowing the undergrounding of these facilities to occur. Thank you fo~ your assistance with this matter. If you have any questions or comments please contact me at your earliest convenience. Sincerely, PONDEROSf"L HOMES II, INC. Jeffrey "chroeder Senior 'Vi President, Land Acquisition & Planning SA1tES GI egg Albert GROUP Vice President RILINGTON DOLCE LLC Mickic L. Riley President 05/09/2005 13:36 FAX 925 734 9141 PONDEROSA HOMES T-158 F003/ 030 15:42 kf 11- F-389 Contract No. R2402OA-C reimb=;e the Developers aver a period of ten (10) years with the addition of the payment of interest at the Me of five (5%) percent per annutu_ As discussed previously, this proposal would require a delay to the widening of Gerald Ford Avmue to the ulfimte three lane configuration. Per our conversations with SCE it will take approximately two (2) years Rw= the date of the payment of a design deposit to the completed imtallation of the facilities. Since we understand that none of our projects requires, for traffic noitigatioia, the widening of Gerald Ford, dAs delay should be an acceptable tradeoff for allowing the wulmSmunding of these facilities to occur. Thank y+::u for your assistance witb, this matter. If you have auy questions or comments please aintact me at your earliest convenie noe. Sin=el! PONDEI OSA HOMES II, INC. Jeffrey C . Scbxved.er Senior Vice President, Land Acquisition & Pla=ng SAKES REGIS GROUP Greg Albert Vice Prm ident RILINGT E LLC Under power of attonseyfirMWde L. Riley Mic 'e L. Riley President Contract No. R2402OA-C -4a»»»> —4M m m m m m m m >1»>aaaa> r�VOCnAWN NlaWw.1 WN -4 � C � m O '% (D C 0) c. o cD I ty cD o � C o 2L co a U) M z O � � y0 0 i i ' I ' a I > M "NMO. "= MM AS=WM, WC r�.rovne � ena a+ea+m�n�e � rn� sownr.e •,. � r,,,a� .pno�v w. Yurrr aoi s "4 rmo CD Utility Studv MACL..EOD / WORLD / PONDEROSA