Which professional group has greater credibility: engineers or attorneys? The Chino Hills Planning Commission has weighed in on that question, coming down on the side of engineers.
The showcase for the decision was the August 2 planning commission meeting, at which the commission was set to discuss giving approval to Newcastle Partner’s request for a site plan review to facilitate the construction of a light industrial building on a 4.67 acre vacant parcel located at the northeast corner of Fairfield Ranch Road and Red Barn Court south of the yet-to-be-completed Fairfield Ranch Commons project.
An issue to be hashed out was what would be the amount Newcastle would reimburse Bochasanwasi Shri Akshar Purushottam Swaminarayan Sanstha Hindu Temple as a fair share reimbursement for the construction of frontage improvements along Fairfield Ranch Road. Those improvements were made following the 2007 approval of the temple project, based upon the Subdivision Map Act and the conditions of approval, which required that as the first developer of the unimproved land in that area, the Bochasanwasi Shri Akshar Purushottam Swaminarayan Sanstha Hindu Temple would have to complete the infrastructure required to make its facility accessible. That infrastructure had to be completed to a level capable of accommodating surrounding properties upon future development, subject to reimbursement once those surrounding properties were themselves improved. Practically, in this case, the Bochasanwasi Shri Akshar Purushottam Swaminarayan Sanstha Hindu Temple was required to extend Fairfield Ranch Road from Red Barn Court to Monte Vista Avenue, including the acquisition of the right-of-way necessary to complete the project.
At one point, representatives of Bochasanwasi Shri Akshar Purushottam Swaminarayan Sanstha (BAPS) Hindu Temple had calculated Newcastle’s share to be $1.2 million. The city attorney’s office, based upon calculation by former city engineer Steve Nix put that reimbursement at $503,345.
City attorney Mark Hensley, however, offered a reimbursement figure even more favorable to Newcastle, pegging the amount at $379,540.
According to Hensley, “the city can only condition the applicant to pay for that portion of Fairfield Ranch Road for which there is a legal nexus between the improvement and the benefit to the Indus property.”
Indus is the landowner of the property upon which Newcastle’s Fairfiled Ranch Commons project is to be constructed.”
BAPS, however, pointed out that in order to facilitate the completion of the frontage road and accompanying property, it had paid well over market value for that land, raising its costs in carrying out the up-front development, and justifying the greater reimbursement from Newcastle.
A staff report accompanying the planning commission item acknowledged that the “$1,025,000, or $17.18 per square foot that BAPS paid for the land in 2007 was above the $9 per square foot market value for industrial land in 2007” but that the most proper way to make the calculation of reimbursement would entail using the fair market price for the land in the cost formula.
After some downward adjustment on its construction and engineering and land acquisition costs, BAPS was yet pushing for a reimbursement of $945,000, asserting that Hensley’s $379,540 figure was both “arbitrary and inaccurate.”
After a previous go-round on the matter at its June 7 meeting, the planning commission opted to accept what appeared to be but which city staff insists was not a compromise number that fell between BAPS’ request and Hensley’s calculation.
The number accepted by the planning commission was $503,345, which was based on the city engineering division’s size up of what was owed to BAPS. According to former city engineer Steve Nix the $503,345 reimbursement can be defended on the basis of a $360,550 construction cost and $142,795 right-of-way acquisition cost.
BAPS incurred costs of $3.3 million for road construction overall and $2,073,892 in acquiring the land, totaling $5.4 million. Until recently there was no indication of any disagreement between Newcastle and BAPS over the reimbursement schedule. Differences became evident, however, at the June 7 planning commission meeting.
Complicating the issue is that Indus Investment Group owns the property Newcastle intends to develop, giving Indus a stake in the successful completion of Newcastle’s development agenda. It was Indus that held out for the higher price on the land acquired by BAPS in 2007 to complete the frontage road. Thus, Indus profited, perhaps by some definitions excessively with the sale of the property used for the frontage road improvements at a price well above market value and now Newcastle-Indus does not want to defray its share of the cost BAPS had to bear in making the improvements that are now benefitting Newcastle. That consideration fueled BAPS’ expectation that its higher land acquisition costs would be factored into its reimbursement.
At the June planning commission council meeting, Newcastle, which represents the landowner Indus, objected to the engineering division’s calculation of $503,345 as too high. BAPS was equally adamant that $503,345 was not enough. The matter was extended to August 2.
On August 2, with commissioner Adam Eliason absent, commissioners Michael Stover, Stephen Romero and Sheran Voigt voted to accept Nix’s figure over that formulated by the city’s lawyers, assistant city attorney Elizabeth Calciano and city attorney Mark Hensley. Planning commission chairman Gary Larson, who suggested that BAPS was due even more than the $503,345 dissented in the vote.
The matter has yet to be fully closed. BAPS has indicated it will appeal the $503,345 reimbursement to the city council as early as next month, disputing assertions by Hensley and city staff that it has not adequately documented its costs on the frontage improvements. Meanwhile, Jackson Smith of Newcastle Partners, while not having filed an appeal on behalf of Newcastle as of this week, has indicated his company disputes the $503,345 figure as too high.