title
2023 ANNUAL COMPLIANCE REVIEW FOR DEVELOPMENT AGREEMENTS
recommended action
RECOMMENDATION
It is recommended that the Planning Commission approve a motion to:
1. Accept the 2023 annual Development Agreement Compliance Review and project determinations indicating if applicant progress complies, substantially complies, or does not comply with the terms and conditions of their respective Development Agreement with the City; and
2. Direct staff to notify Applicants of this compliance determination. Applicants found in noncompliance with the Development Agreement terms will have 30 days following the date of notification to rectify the noncompliance or prepare a program for correction. The Planning Commission shall be notified of the correction or program at the next available meeting.
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Summary
A Development Agreement (DA) is a voluntary legal contract between a local jurisdiction and an entity that owns or controls property within the jurisdiction. The DA details the obligations of both parties and specifies the standards and conditions that will govern the development of that property. Per Stockton Municipal Code (SMC), the Planning Commission is the recommending authority to City Council for new DAs and is responsible for the DA annual compliance monitoring. The City Council is the final approving authority and must conduct a public hearing to adopt a new DA by ordinance. Subsequent amendments to the agreements can be made by either the City Council or City Manager if specified in the agreement and SMC Section 16.128.120.
State Law, local regulations, and the DAs themselves require each developer representative to submit an annual progress report to the City to demonstrate that they are in good faith compliance with all obligations and conditions required to be performed in the agreement. The Agreement identifies the Planning Commission as the review authority for determining the developer’s compliance with the Agreement.
By the end of 2023, the City of Stockton had ten active DAs requiring annual review (Attachment A - Map of Active Development Agreements in 2023). One DA was added in 2023 (Mariposa Industrial Project) as it was approved in 2022 but became effective in June 2023. Staff’s analysis of the ten active DAs in 2023 concludes that nine comply and one substantially complies.
DISCUSSION
Background
A “Development Agreement” is a voluntary legal contract between a local jurisdiction and a person or entity who owns or controls property within the jurisdiction, detailing the obligations of both parties and specifying the standards and conditions that will govern the development of that property. Development agreements are usually employed for large, complex development projects constructed in phases over the years. The agreement may set the specific zoning, design, and other construction requirements for the project and give certainty to the developer that the rules will not be significantly changed by the City over time. In return for this regulatory certainty, public agencies often negotiate additional benefits (or mitigation programs) that the developer will provide with the project.
The City has been involved with numerous development projects that included a DA to outline obligations and vest development rights. While approximately 17 DAs are no longer active due to expiration, completion of development, or inactivity by the developer, the City has ten (10) active DAs in various forms of developmental progress. The 2023 active DA summaries are detailed in Attachment B.
Present Situation
Consistent with the State Law and the Stockton Municipal Code, all DAs must be periodically reviewed at least once every twelve (12) months. This review begins with Staff sending a compliance letter to request the developer representative submit an annual progress report to demonstrate compliance with the terms or conditions of the agreement within 30-days of receipt of the Staff’s letter. A copy of compliance letters and the Applicant’s responses for all the active DA’s can be found in Attachment C.
After the compliance letters have been sent and the response analysis completed, the Planning Commission is required to determine Applicant compliance with their DA obligations. Applicants found to be “Compliant” or “Substantially Compliant” will be sent a letter confirming compliance, and no further action will be required. Projects determined to be substantially compliant will be directed to work with staff to correct the minor issues to avoid a noncompliance determination at a later review. Applicants found to be “Noncompliant” will be sent a letter after the Planning Commission determination indicating the specific obligations that require correction for compliance to be made. Applicants will be given 30 days to respond to the Noncompliance letter to correct non-compliant items or indicate how compliance will be achieved. If compliance takes additional time, the Planning Commission will be updated until compliance is achieved.
Staff has analyzed the 2023 active DAs and provides the following summary of compliance recommendations to the Planning Commission for each project.
1. Spanos Park West (Includes Business Park DA1-00 + Density Transfer DA3-1)
• Description: The DA allows A.G. SPANOS CONSTRUCTION, INC. the ability to establish a Master Development Plan (MDP) to facilitate mixed-use development of the 200-acre residential and commercial center. The MDP includes design and use standards and anticipates High-Density Residential, Office, Commercial-Retail, Neighborhood Park, and Open Space uses in addition to on/off-site improvements. The project also includes a Density Transfer agreement tied to the DA that allowed the applicant to construct mostly single-family housing without providing the higher density housing required by the Housing Element at the time of approval. This agreement included an amendment that allowed the applicant to either build their fair-share of high-density housing (approximately 627 units) of the surrounding project (i.e., Westlake, Delta Cove, Crystal Bay) or pay a $2,000 in-lieu fee per each unit not constructed.
• Status: Approximately 83% complete as ±33.5-acres remains vacant.
• DA Compliance: Compliant. In 2023, a DA and Density Agreement amendment (P22-0086) to extend the DA date and clarify the obligations in the Density Agreement was approved by the City Council. No further action is needed for the 2023 annual DA review.
2. Westlake Villages and Crystal Bay Projects
• Description: The DA allows the SPANOS FAMILY PARTNERSHIP AND A.G. SPANOS the ability to establish the Westlake at Spanos West (West Lake) MDP to construct 689.6-acres into a 2,800-unit residential community and the existing Paradise Point Marina (Paradise Marina). The DA also included a 173.6-acre undeveloped property (Spanos Property) within the County. The 173.6-acre “Spanos Property” was later approved as the Crystal Bay Project in 2010, which included annexation and Planned Development (PD) standards for constructing 1,343-unit residential communities with parks, roads, infrastructure, and landscaping. The Crystal Bay Project is contained in the Spanos West Business Park Density Transfer Agreement (DA3-01).
• Status: Westlake is currently under construction. Crystal Bay and the Marina area have not begun construction.
• DA Compliance: Compliant. No further action is needed for the 2023 annual DA review.
3. Cannery Park (Amendment Under Review)
• Description: The DA allows HOMAN INVESTORS, LLC vested approval to develop approximately 450 +/-acres of land located at the southwest corner of State Route 99 and Eight-Mile Road. Proposed the construction of 1,116 single-family detached housing units and 210 multi-family housing units, 1,452,508 square feet of light industrial business park, and 1,078,763 square feet of commercial land use initially. Per the DA, the Developer is entitled to allocate the single-family detached housing units and the multi-family housing units on any parcel subject only to the extent that same does not exceed the maximum density for the zoning designation and the maximum units provided for herein.
• Status: Cannery Park is currently under construction. An application for amendment has been submitted (P21-0435) proposing to convert some commercial properties to single-family housing and relocate the High-Density housing site adjacent to the commercial zoned properties along Eight Mile Road.
• DA Compliance: Compliant. Developer is seeking a DA amendment along with new Tentative Subdivision Map in 2023 (P21-0435). The amendment requires Planning Commission consideration for recommendation, and City Council approval that are both scheduled to occur in 2024.
4. University Park
• Description: The DA allows THE STOCKTON CENTER SITE AUTHORITY and GRUPE COMMERCIAL COMPANY to establish a MDP on approximately 103-acres of land to establish a mixed-use development that includes: a long-term educational center and a mix of commercial and residential development. The MDP has standards and preferences to retain existing historic buildings.
• Status: New offices and parking areas are currently under construction. Staff will work with the Applicant to discuss options to develop housing on the site as part of the Housing Action Plan and Housing Element.
• DA Compliance: Compliant. No further action is needed for the 2023 annual DA review.
5. Sanctuary
• Description: The DA allows SANCTUARY BY GRUPE, LLC vested approval rights to construct approximately 7,070 dwelling units, 483,984 square feet of offices, 208,272 square feet of retail, and approximately 100 hotel rooms are planned on the site, along with three lakes, a marina, a private River Club, religious facilities, four schools, orchards, vineyards, a small winery, and extensive recreational open space. The entire Sanctuary property, which extends into the surrounding sloughs, totals 1,967 acres; however, approximately 1,839-acres make up the total land area, including the adjacent levee. Furthermore, approximately 1,728-acres of the total 1,839-acres of land are considered developable; the remaining 111 acres consist of the Levee Walk. Project construction will include improvements to the existing levees.
• Status: Development has not begun the project. Tentative Subdivision Maps, Design Review, and possible Use Permit review for commercial businesses would be needed before the issuance of building permits for residential and nonresidential uses.
• DA Compliance: Compliant. No further action is needed for the 2023 annual DA review.
6. Mariposa Lakes Specific Plan
• Description: The DA allows PCCP MARIPOSA LAKES, LLC vested approval rights to develop The Mariposa Lakes Specific Plan area, which comprises approximately 3,810 acres of unincorporated lands located four miles southeast of downtown Stockton and 3.5 miles northeast of the Stockton Metropolitan Airport. The area is bounded by State Route 4 or Farmington Road on the north, Kaiser Road on the east, Mariposa Road, and the Burlington Northern Santa Fe (BNSF) Railroad on the south and the west.
• Status: The Project has been inactive for some time and requires the Applicant to enter into a new Annexation Agreement with the City. Staff anticipates many of the approved reports will need updates before consideration by the Local Agency Formation Commission (LAFCo) for annexation into the City. There has been development interest in the area, but no formal projects have been submitted. The project still requires annexation approval by the Local Agency Formation Commission (LAFCO).
• DA Compliance: Substantially compliant due to need for a new Annexation Agreement. The Applicant’s compliance letter (Attachment C) indicates a desire to submit an amendment to the project in early 2025, and align the Annexation Agreement with that amendment.
7. Port of Stockton P12-087
• Description: The DA provides the PORT OF STOCKTON vested rights to approximately 2,300-acres of industrial area to operate according to the General Plan and Zoning Ordinance at the time of the DA adoption (Industrial Land Use Designation with Port Zoning). The DA boundary includes the Rough and Ready Plan Master Plan (West Section) and a map of the existing Port Industrial area west of Boggs Tract (East Section).
• Status: Not applicable and reviewed on a project-by-project basis.
• DA Compliance: Compliant. No further action is needed for the 2023 annual DA review.
8. Delta Cove P09-160
• Description: The DA allows DEAN SPANOS and DEA SPANOS BERBERIAN, CO-TRUSTEES OF THE ALEX AND FAYE SPANOS FAMILY TRUST, the ability to extend the approval to establish a new 1,545-unit residential community with parks, open space, commercial use, and a 280-unit condominium project on three vacant parcels totaling 360 acres.
• Status: The developer has not begun the project. The City Council approved the DA on November 1, 2022.
• DA Compliance: Compliant. No further action is needed for the 2023 annual DA review.
9. Mariposa Industrial Park Project P20-0805
• Description: The DA provides Greenlaw Partners, LLC with a vested right to establish a new industrial development of seven warehouses on approximately 203.48 acres on six parcels that are largely vacant with agricultural uses and two residences. The City Council initially approved the project and Development Agreement on December 6, 2022.
• Status: Construction permits are under review, with some being issued after compliance with conditions and mitigation measures were confirmed by staff.
• DA Compliance: Compliant. No further action is needed for the 2023 annual DA review.
10. St. Joes Hospital Expansion Project P21-0958
• Description: The DA provides Port City Operating Company, LLC with a vested right to expand and modernize the existing medical center within a Master Development Plan on multiple parcels on approximately 18.7 acres on multiple parcels that are largely developed with existing buildings used for the medical center.
• Status: The applicant applied for one lot tentative parcel map (P24-0012) to merge three parcels into one for the expansion of the St. Joseph’s Medical Center of Stockton. Building construction/demolition has not been completed as of 01/29/2024.
• DA Compliance: Compliant. No further action is needed for the 2023 annual DA review.
Compliance Recommendation
Staff recommends that the Planning Commission find all development projects in Compliance or Substantial Compliance for the 2023 calendar year (Attachment D - Development Agreement Compliance Summary). If the Commission agrees with Staff’s compliance determination, the Planning Commission should direct staff to send notices to the developers indicating compliance described in this report (Attachment E - Draft Compliance and Noncompliance Letters to Applicants).
Environmental Determination
The current action required of the Planning Commission is an annual compliance review of the Development Agreement, not a project as defined by CEQA Guidelines General Rule (14 CCR 15061(b)(3)). Therefore, no additional environmental documents are required.
Public Notice
The City provided a 10-day notice to each DA representative included in Attachment D before the scheduled meeting date.
Attachment A - Map of Active Development Agreements in 2023
Attachment B - Development Agreement Summaries
Attachment C - Compliance Letters and Responses
Attachment D - Development Agreement Compliance Summary
Attachment E - Draft Compliance and Noncompliance Letters to Applicants
This report was prepared by Senior Planner, Anson Lihosit, (209)937-8316; Anson.Lihosit@stocktonca.gov.