Agenda

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City Council Regular Meeting

Meeting Date:

03/07/2023

BACKGROUND

ILF N-T Owner, LP. is the developer of the Homestead Residential Development located on the south side of IH-35 one either side of Homestead Parkway. The developer is seeking approval of multiple agreements with the City.

The developer is seeking to defer construction of Sundown Parkway with Units 9 and 11. Currently, Sundown Parkway does not extend beyond Unit 11 to the east. As such this section of road would provide little benefit at this time. In and effort to better manage development costs the developer is seeking to delay construction for 3 years from the date of the recordation of the plats. Staff is supportive of this as the road provides little benefit at this time and the City would have to begin maintaining it upon acceptance.

The developer is also requesting a Reimbursement Agreement associated with the construction of Public Improvements. The developer is seeking an oversize reimbursement for upsizing waterlines from 8" to 12" in Units 7A and 3B and constructing a 12" waterline Unit 5. Additionally, the developer is seeking to increase the City's oversize participation in the offsite sewer forcemain. Per the initial reimbursement agreement from 2016, the City agreed to pay up to $125,655.30 for the oversize of the offsite of the forcemain, based on the estimated cost of construction at that time. It took a significant amount of time for the developer to acquire the offsite easements and costs rose significantly - the City's portion is now $321.544.76.

Finally, the developer is seeking an amendment to the Roadway Capital Recovery Offset Agreement. The developer initially entered into a Roadway Capital Recovery Offset Agreement in 2019 provided offsets for the construction of Homestead Parkway and Schwab Road. The commercial portion of the property was not eligible to utilize the offsets. In 2020 an amended Roadway Capital Recovery Agreement was approved by Council to add a couple of the residential units to be eligible to utilize the offsets that were incorrectly left out of the original agreement. That agreement was never executed. Since then the developer became aware that they would be required to construct Sundown Parkway west of Homestead Parkway. This requirement came about as a result of a change to the City limits between Schertz and Cibolo in 2017 that shifted this road into Schertz. The developer is requesting to amend the agreement to provide that no roadway impact fees are due from the residential portion of the Homestead as a result of the developer constructing adjacent sections of Homestead Parkway, Schwab Road and Sundown Parkway, all roadway impact fee system roads. With the rezoning to allow the multi-family units on 7B, 13 and 18, definitively determining the number of vehicle miles the development will contribute is impossible. The developer proposed not tracking credits, so they can better estimate their costs, not have to push platting forward faster than they would normally do so simply to lock in a maximum assessable fee (when the City updates the Roadway Impact fee ordinance). It also ensures the City would not have to reimburse the developer for any unused credits. If the developer were to maximize the number of residential units allowed by zoning, the developer might not have to pay for up to 53 units. Given the history of this project, roads built before the impact fee ordinance adopted, the requirement to construct roads based on the City limits swap, the amount of roads being build and the uncertainty in determining the exact number of offsets or credits, staff is comfortable with the proposal.

GOAL

Provide for the orderly development of infrastructure within the City of Schertz.

COMMUNITY BENEFIT

Provide for development of infrastructure in a timely, cost-effective manner.

SUMMARY OF RECOMMENDED ACTION

Approval of Resolution 23-R-01 authorizing the City Manager to enter into Subdivision Improvement Agreements for Homestead Unit 9 and Unit 11, an Amended Roadway Capital Recovery Offset Agreement and Reimbursement Agreement for Construction of Public Improvements with ILF N-T Owner, LP.

FISCAL IMPACT

The developer is proposing to post a surety for 124% of the cost of roadway improvements being deferred with Units 9 and 11. The estimated road construction costs are $194,616.10 and $321,984.90 respectively.

The City is obligated to pay $455,555.79 for water line upsizing and $321,544.76 for the offsite sewer forcemain oversizing for a total of $777,100.55.

The Roadway Impact Fee agreement ensures the City would not have to pay for any unused offsets, but likely means the City is foregoing up to approximately $181,000 in roadway impact fee revenues. Credits for construction of system roadways are normally provided in the form of vehicle mile credits not dollar credits based on actual construction costs. For example, the estimated cost of Sundown Parkway is just over $515,000 but the value of the credits equates to only $327,000 or $188,000.

RECOMMENDATION

Approval of Resolution 23-R-01.

Attachments
Res 23 R 01
Unit 9 Sub Improvement
Unit 11 Sub Improvement
Roadway Offset Homestead
Reimbursement Homestead