2021 Development Agreements - Annual ReportCity of La Quinta
CITY COUNCIL MEETING: October 19, 2021
STAFF REPORT
AGENDA TITLE: RECEIVE AND FILE ANNUAL REPORT OF ACTIVE
DEVELOPMENT AGREEMENTS
RECOMMENDATION
Receive and file annual report of active development agreements.
EXECUTIVE SUMMARY
The La Quinta Municipal Code requires annual Council review of active
development agreements (DA).
Five active development agreements were identified including the Centre
Pointe, Legacy Villas, Village Park Animal Hospital, Signature at PGA
West, and SilverRock Resort development projects.
FISCAL IMPACT
Centre Pointe, Legacy Villas and Signature at PGA West are required to pay
mitigation fees as part of their DA’s. These developments are either non-
compliant or partially compliant in remitting the fees owed, see
background/analysis below.
BACKGROUND/ANALYSIS
The periodic review of DAs by Council is required at least every 12 months from
the date the DA was entered into until the expiration of the agreement. Five
active DAs have been identified (Attachment 1). Of the five, Village Park
Animal Hospital, was determined to be in full compliance with no further
obligations. The remaining agreements are summarized in the table below.
Active Development Agreements
Project
Name
Parties to
Agreement
Project Description Effective
Date
Status
Centre
Pointe
CP
Development
La Quinta, LLC
(original
applicant), La
Quinta Desert
Villas, Dolphin,
Eisenhower
68-acre mixed-use
development at SEC
of Washington Street
and Miles Avenue
July 17, 2003,
December 18,
2003
(Expires
2053)
Mitigation fees are
delinquent.
Casitas Units
(partially
constructed)
Applebee’s
STUDY SESSION ITEM NO. 1
253
Medical,
Homewood
Suites, Dr.
Sterling, Dr.
Hsu, La Quinta
Palms
Retirement
Community,
Applebee’s
restaurant
(complete)
Homewood Suites by
Hilton La Quinta
(complete)
The Palms La Quinta
retirement
community
(complete)
Eisenhower Medical
Center (complete)
2nd sit-down
restaurant (vacant,
never constructed)
Pioneer Park
(complete)
Legacy
Villas
Centex Homes 280 residential units
at NWC of Coachella
and Eisenhower
November 20,
2003
(Expires
2053)
Mitigation fees are
delinquent.
Signature
(PGA
West)
Crown Pointe
Partners, LLC
(original
applicant),
WPG LQ, LLC
264 condo/townhome
units at PGA West,
consist of Villas,
Haciendas, and
Estates
August 18,
2008 (Expires
2058)
Mitigation fees have
been partially paid
SilverRock
Resort
SilverRock
Development
Company, LLC
Development of the
SilverRock Resort
including luxury hotel,
lifestyle hotel, luxury
branded residential,
shared services and
conference center,
and mixed-use village.
November 18,
2014
(expires
November 18,
2044)
Amendment 4
approved October 5,
2021
The Centre Pointe, Legacy Villas and Signature developments are within a
Tourist Commercial District, which is intended for and permits land uses that
include specialized commercial tourist-oriented uses and resort activity that
generate transient occupancy tax (TOT) revenue. DAs were executed for these
projects for a per unit payment to the City based on performance measures for
the collection of TOT revenue.
Centre Pointe
The Centre Pointe development includes approximately 68 acres at the
southeast corner of Washington Street and Miles Avenue, and is currently
comprised of Homewood Suites, La Quinta Desert Villas (40 residential
254
condominium units), Applebee’s, Eisenhower Health Center and The Palms at La
Quinta senior community. The north portion of Centre Pointe is within a Tourist
Commercial District (CT).
In December 2003, a Disposition and Development Agreement (DDA) with the
La Quinta Redevelopment Agency was adopted since this was, at the time,
redevelopment property that was sold to the developer. A DA with the City of
La Quinta was also adopted. The DA and DDA included provisions for the
construction of the mixed-use development, including 132 residential “Casitas,”
which under subsequent amendments was changed to 164. These units are
subject to payment of one-time and annual mitigation fees to the City, unless
the City receives $546,131 minimum, plus annual CPI increase, annual
transient occupancy tax (TOT) for three consecutive years generated by the
development (Attachment 2). With the annual CPI increase, the minimum is
now $650,044. To date, 40 of the proposed 164 Casitas units have been
constructed as residential condominiums that restrict short term rental use.
These are presently known as La Quinta Desert Villas. The City has invoiced
the La Quinta Desert Villas Homeowners Association (HOA) for these annual
mitigation fees since 2016 as the minimum TOT revenue is not being
generated. The HOA is the only party being billed since these are the only units
that have been issued Certificates of Occupancy. The HOA made payments on
2016-2019 fees; however, it is not current on the payment of their fees for
Fiscal Year (FY) 2019/20, and FY 2020/21 was invoiced in August for a total
due of $14,097.31.
Legacy Villas
The Legacy Villas development is located west of Eisenhower Drive at Coachella
Drive, north of the La Quinta Hotel. This development consists of 280
residential for sale units that if the owner chooses to rent them, may only be
rented as short-term rentals. The rentals are required to be registered in a
rental pool and report their TOT to the City on a regular basis. The units are
also required to pay mitigation fees and can stop paying mitigation fees when a
threshold of $1,000,000 of TOT collected for any three consecutive operating
years is met. This has not been met to date and the units are still responsible
for mitigation fees. A partial payment has been received for 2020 fees and a
notice has been sent requesting the remainder, and 2021 was invoiced in
August for a total due of $463,677.90. A summary of the DA is provided as
Attachment 3.
Signature at PGA West
The Signature development consists of 230 resort residential units that are also
subject to TOT mitigation payments. These payments are to be collected at the
time of sale, transfer or conveyance of each unit, upon first sale and resales.
The development has paid fees for the first sale of units, but not all individual
owners have paid fees upon resales. Staff is working towards identifying and
locating these previous owners, with the intent to invoice them for the fees that
255
should have been remitted to the City upon closing. A summary of this DA is
provided as Attachment 4.
SilverRock
Agreements in place for SilverRock consist of a DA and a Purchase, Sale and
Development Agreement (PSDA) which were entered into in November 2014
(Attachment 5). The PSDA was amended in November 2018 to modify the
development schedule, clarify requirements for selling planning areas 7, 8 and
9, identify phasing plan for master site infrastructure improvements, update
project budgets and define ownership structures for the SilverRock
Development Company (SDC). A notice of default was issued earlier in 2021
regarding delays in the development schedule due primarily to cost escalation
and pausing construction during COVID-19. The PSDA has since been amended
to modify the development schedule and the project is moving towards meeting
those new deadlines.
ALTERNATIVES
Staff does not recommend any alternatives.
Prepared by: Cheri Flores, Planning Manager
Approved by: Danny Castro, Design and Development Director
Attachments: 1. Map of developments with active development agreements
2. Centre Pointe Development Agreement Summary
3. Legacy Villas Development Agreement Summary
4. Signature Development Agreement Summary
5. SilverRock Resort Development Agreement Summary
256
CENTRE POINTE
LEGACY VILLAS
SILVERROCK
SIGNATURE
VILLAGE PARK ANIMAL HOSPITAL
Development Agreement Project Locations
¯
September 2021Jefferson StWashington StHwy 111
Ave 50
Ave 52
Legend
City Boundary
Centre Pointe
Legacy Villas
Village Park Animal Hospital
SilverRock Resort
Signature at PGA West
ATTACHMENT 1
257
Center Pointe Development Agreement (DA2003-0006)
Project Description: 134 room hotel, 136 condo/casita units, residential
development of 54 detached homes, 14 market rate homes, 2 restaurants, medical
office, surgical facility, 132 suite retirement community, 72 suite assisted living,
and a 32 bed memory care facility.
Applicant: Center Pointe Development LQ, LLC
Case No.: Development Agreement 2003-006, Ord 385, 409, 423, 455 and 504
(4 amendments)
Disposition and Development Agreement (7 amendments)
Related Case: Specific Plan 2001-055, EA 2001-436, 2011-617
Effective Dates: December 18, 2003, Expires December 18, 2053 (50 YEARS)
Key Points of the Agreement:
Developer to construct 134 guest room hotel, 136 condo/casitas units, 13
courtyard cluster villas, 54 unit residential development, 14 market rate
homes, 40 affordable homes, two restaurants, medical office/ surgical
facility, 26 sanctuary villas.
Development of a Casitas HOA
Developer constructs a neighborhood park.
Contribution towards landscape improvements
Payment of Mitigation fees
o One-time mitigation fee
Casitas: $1,500 for each unit with payment due upon the first
close of escrow
Sanctuary Villas: $2,150 for each unit with payment due upon
the first close of escrow
o Annual mitigation fees:
Casitas and Sanctuary Villas: $150 for each unit sold to a
purchaser to be paid each July 1. Fee shall not be required for
any operative year in which the City has received transient
occupancy taxes derived from the Suites Hotel parcel, casitas
parcel, and sanctuary villas parcel which equals or exceeds
$546,131 for the applicable operative year
o If City received minimal annual TOT ($546,131) in each of three
consecutive operative years, the Casitas and Sanctuary Villas HOA’s
obligation to pay the annual mitigation fee shall be terminated.
Public Facilities Fee: 5% of rental amount if rented for a period of time over
30 days
ATTACHMENT 2
258
Sanctuary Villas later removed from the development plan (DA Amendment
2)
DA Amendment 4 replaced the development of single-family residential
homes with a senior living facility, The Palms, consisting of 132 retirement
suites, four single-story duplex cottages, 72 assisted living suites, and 32
beds for memory care.
To view the documentation for the CP Development La Quinta LLC Disposition and
Development and Development Agreements please use the following web address:
https://laqlaserweb.laquintaca.gov/WebLink/DocView.aspx?id=20723&searchid=ad
833b3f-2b17-433c-9b7f-d86170883192&dbid=1&repo=CityofLaQuinta
259
LEGACY VILLAS DA TERMS (DA 2003-007)
Project description: 280 unit Residential Resort on 44.61 Acres
Applicant: Centex Homes
Case No.: Development Agreement 2003-007, Ordinance 389
Related Case: Specific Plan 2003-065, Site Development Permit 2003-778,
Environmental Assessment 2003-478, Tentative Tract Map
31379
Effective Dates: Development Agreement is considered effective on December
12, 2003, and expires December 11, 2053 (50 YEARS).
Key Points of the Agreement:
A one-time mitigation fee of $2,500 per unit constructed in the project due
on or before the date the building permit is issued for each unit.
Annual mitigation fee which is collected by the HOA at $1,000 per year per
unit that has been sold to an owner. The HOA then forwards to the City of La
Quinta.
The Annual mitigation fee is reduced from $1,000 to $500 per year if the City
receives TOT from rental units in the project that exceeds $500,000 for three
consecutive years during the term of the Development Agreement and can
be totally eliminated if the City has received TOT from rental units in the
Project in excess of $1,000,000 for any three consecutive operating years
during the life of the Development Agreement.
Any rentals are subject to TOT.
Rental Tracking System by HOA.
To view the Centex Homes Development Agreement please use the following web
address:
https://laqlaserweb.laquintaca.gov/WebLink/DocView.aspx?id=20844&searchid=1d
9b36aa-5311-452b-ae5d-314022a50780&dbid=1&repo=CityofLaQuinta
ATTACHMENT 3
260
EDENROCK (SIGNATURE) DA TERMS (DA2006-011)
Project Description: 264 condo/townhome units (83 Courtyard Homes, duplexes,
79 Manor Homes, triplexes, and 102 Village Homes, sixplexes) on 41.95 acres.
Applicant: Crowne Pointe Partners, LLC
Case No.: Development Agreement 2006-011, Ordinance 457, 533
Related Case: SP 83-002, Amendment No. 6, GPA 2006-107, ZC 2006-127,
Tentative Tract Map 33226, SDP 2006-852
Effective Dates:
August 18, 2008, and expires August 18, 2058 (50 YEARS)
Assignment and Assumption Agreement entered into March 24, 2014,
assigned to RREF-CWC LaQ, LLC
Amendment 1 entered into on March 8, 2016
Purpose: Development Agreement entered into for purposes of payment to City
a per unit upfront payment for potential loss of anticipated general fund revenues
from “Transient Occupancy Tax” as a result of the use of the site for a residential
resort instead of a traditional tourist commercial use such as a 1,000 room resort
hotel, conference center and 100,000 square feet of resort retail.
Key points of the Agreement:
Compliance with Conditions of Approval
Recordation of Covenants, Conditions and Restrictions (CC&Rs)
Payment to the City for each unit 0.75% of the developer’s full sale price
of the unit upon close of escrow, inclusive of all developer-installed
options and upgrades, with the amount of such sales price verified by the
City.
Owners required to pay transfer payment to the City in the amount of
0.55% upon sale, transfer or conveyance of owner’s unit (Recorded in
CC&R’s)
Payment of Fair Share Improvements as identified in mitigation measures
11.0-3 and 11.0-4 of the project EIR.
To view the Signature Development Agreement and Amendment, please use the
following web links:
Development Agreement:
ORD 457 DA Eden Rock at PGA West - Crowne Pointe Partners, LLC (laquintaca.gov)
Amendment 1:
ORD 533 RREF II-CWC LaQ, LLC - Signature at PGA West - Amendment to DA
(laquintaca.gov)
ATTACHMENT 4
261
AUGUST 2019
SILVERROCK DA TERMS (DA 2014-1001)
Project description: Development of a resort development as follows:
Area Project Components Acres Units
PA 1 Modification of existing Golf Course 173
PA 2 Montage Luxury hotel with spa and fitness center
(170,000 sq. ft)
17 140
PA 3 Montage Luxury branded residential homes 14 35
PA 4 Shared service/conference facility 7.5
PA 5 Pendry Lifestyle hotel (170,000 sq. ft.) 10.5 200
PA 6 Pendry Lifestyle branded residential development 10 66
PA 7 Mixed-Use Village Area 1 10.5 150
PA 8 Resort Residential Village 22.5 160
PA 9 Mixed Use Village Area II (80 units) 15 80
PA 10A-1 Golf Course and Clubhouse 51.5 25
PA 10A-2 Residential 13.5 46
PA 10A-3 Residential 5 23
PA 10B-1 Golf Course 62 40
PA 10B-2 Residential 5.5 19
PA 10B-3 Residential 4.5 20
PA 10B-4 Residential 7 34
PA 10B-5 Residential 5.5 22
PA 10B-6 Residential 5.5 24
PA 11 Public Park 22
PA 12 Arroyo, Trails, Canal & Streets 53.5
Total 525 1084
Applicant: SilverRock Development Company, LLC
Case No.: Development Agreement 2014-1001, Ordinance 520
Related Cases: SDP 2016-0005, SDP 2016-0009
Effective Dates:
Development Agreement approved on November 18, 2014
Purchase Sale and Development Agreement (PSDA) entered into on
November 19, 2014, and expires November 19, 2044 (30 YEARS).
Amendment 1 to the PSDA was entered into on October 29, 2015
Amendment 2 to the PSDA was entered into on April 18, 2017
Amendment 3 to the PSDA was entered into on November 28, 2018
Amendment 4 to the PSDA was approved October 5, 2021
Purpose (Amendment 4 of PSDA): Modifies the development schedule;
decreases the amount of Transient Occupancy Tax (TOT) receipts available by 5%
for the 15-year term when calculating any rebate for continuous operation of the
hotels, once opened, under TOT Covenant Agreements; identifies additional project
ATTACHMENT 5
262
AUGUST 2019
milestones; increases the purchase price on “Future Resort Property“ (Option
Property) for missing milestones; and requires hotel operator to manage all resort
residential short-term vacation rentals.
Key points of the Agreement:
Establishment of a vested right to execute and fulfill the development program
in accordance with the SilverRock Resort Specific Plan and applicable zoning
regulations.
Development impact fees are to be paid in accordance with those fees in force
and effect as of the effective date of the Agreement.
Any non-city development fees, such as the CVMSHCP or TUMF fees, will be
collected at the rate in effect at the standard time of collection.
Developer is responsible for executing development in accordance with identified
development program.
Developer acknowledges responsibility for CEQA mitigation monitoring.
The Agreement is to be reviewed at least annually in order to ensure compliance
with provisions.
Use the Ahmanson House as temporary clubhouse, in lieu of constructing a
temporary clubhouse, until the permanent clubhouse is operational.
Master Site Infrastructure Improvements Phasing Plan amended.
To view the SilverRock DA, please use the following web address:
https://laqlaserweb.laquintaca.gov/WebLink/DocView.aspx?id=44821&searchid=c9
a0a048-c544-4863-b159-5d2cd849d669&dbid=1&repo=CityofLaQuinta
To view Amendment #4 to the PSDA, please use the following web address, page
147:
https://www.laquintaca.gov/home/showpublisheddocument/45845
263