The San Benito County Planning Commission on March 20 approved an amendment to the agreement between the county and San Juan Oaks LLC/Scott Fuller regarding a 1,084 senior housing project. The amendment locks into place 2015-era impact fees and extends the agreement to March 31, 2029. The commission’s recommendation will now go to the San Benito County Board of Supervisors for a vote at a later date.
According to Fuller, a principal with the project and the former manager of San Juan Oaks Golf Club, the overall economic impact of the senior community when completed would bring the county $1.1 million annually, after all costs were paid. Building the project would cost over $400 million and employ 500 people, generating $22 million in annual income. After completion, there would be 322 jobs, with an annual input into the economy of $40 million.
The Del Webb senior housing development was first proposed in 2015. The developer pulled out of the project in 2016. The PulteGroup Inc., the parent company of Del Webb, said it was doing so for “business reasons.”
At the time, however, Supervisor Anthony Botelho blamed the project’s demise on the California Department of Fish and Wildlife, calling it a “runaway, horrible agency” because of its environmental mitigation requirements for protecting the California tiger salamander.
At the March 20 meeting, county planner Taven Kinison Brown presented the application to the San Benito County Planning Commission. He said the senior project was zoned as a planned development and agriculture rangeland.
Brown explained that the project was originally approved in 2015, and when fully built out would include 1,084 active adult (senior), market-rate units, as well as a 200-room hotel, a four-acre assisted living and skilled nursing facility, 65,000 square feet of commercial space, up to 25,000 square feet of amenity space, a 1,243 acre wildlife habitat, and an agriculture preserve.
Brown said the agreement contained a $5.5 million community benefit fee that San Benito County could use in any way it wanted. He said the developer was not required to pay the entire amount up front, but could do so in tiers as the project was built. The developers proposed paying $6 million up front.
Brown explained that in trade for the $6 million, along with two acres set aside for a public safety facility, the development fees that are locked in at 2015 rates would go to March 31, 2029.
Fuller said locking in the 2015 impact fee rates was critical because after Del Webb pulled out, three years have already passed as negotiations continue with San Juan Oaks LLC/Scott Fuller. He said the $5.5 million community benefit fee still had to be paid, but the terms for the agreement are much shorter. By the time the project moves forward, there may only be two or three years left on the original agreement and the development would be facing higher fees, Fuller said.
“We really need for this to happen for the project to remain viable,” Fuller said, adding that in addition to the $5.5 million fee, there were numerous benefits to the county, including the $1 million purchase/preservation of 150 acres of prime farmland near San Juan Bautista used to mitigate land near San Juan Oaks for the development, as well as the onsite preservation of 50 more agricultural acres. “We’re dedicating land, constructing and maintaining two community parks that are not just for the residents, but for the community, at large.”
Fuller said the project would also pay $200,000 annually for Community Facilities District (a special taxing district formed to pay for major backbone infrastructure improvements necessary to support development of the project and essential on-going services), $3.4 million toward schools with virtually no impact from the senior community, jobs at the proposed 200-room hotel, as well as sales and transient occupancy taxes (TOT). He said $6 million would be paid either when the first building permit is granted, or no later than March 31, 2021.
“We are paying impact fees,” he said. “We’re just paying them at the rate that was in place when the project was approved. That’s $30 million in impact fees, engineering and inspection fees, and the school fee.”
County Counsel Barbara Thompson said at the meeting that the County Administrative Office had reviewed the proposal.
“They support it due to the economic value of the project,” she said. “There’s multiple sources of revenue to the county, including property and sales taxes, and we have very few TOT revenue sources in the unincorporated area of the county.”
Former Hollister City Councilman Karson Klauer spoke during public comment and said that while he supported the project, he was concerned about the financial analysis because he did not see the difference between 2015 impact fees and the present fees. After looking up impact fees on the county website, he said traffic impact fees alone amounted to a difference of $8,000.
“When you multiply that by 1,084 homes, all of a sudden that number is pretty big,” Klauer said. “My concern is maybe we’re not super clear about what the number is that we’re agreeing to if we approve this. In the end, it’s going to be a judgment call on the economic benefits versus essentially government money, because it is government money if you approve this. It’s not a grant, but you’re giving something up to get something else.”
After discussing it among themselves, planning commissioners voted 3-1 to approve the amendment, with Commissioner Eduardo Navarro absent. Commissioner Robert Eggers was the dissenting vote.
Fuller spoke to BenitoLink on March 21 and said he felt Klauer and Eggers ignored the value of the $6 million.
“The idea of ‘we’re getting a break on the impact fees’ is the whole point of locking them in,” he said. “Of course we’re getting a break, but they’re discounting the value to the county of getting $6 million with the first permit, which is a hedge against the project slowing down. Six million today is worth more than $10 million over the next 10 years.”
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