|
|
|
|
::: COMMUNITY NEWS
For now, North and South remain divided by the Cosumnes Corrected
Tuesday, August 16, 2005 The permits have been secured, the wood superstructure has been fabricated, and the forms for the concrete support piers have been built. In all, the Rancho Murieta Association says $870,000 has been spent already in an effort to build a $1.5 million pedestrian bridge across the Cosumnes River to connect North and South Murieta. "That's all being stored and waiting to go in next year," said RMA President Paul Gumbinger. "Hopefully we'll find a key to this thing and all agree on what's required and get on with it." But for the foreseeable future, everything's on hold, and the pieces of the bridge are stored away because every aspect of the schedule was aimed at being ready to build right now, when the environmentally sensitive river is at its lowest. The project came to a halt publicly when the RMA announced Aug. 5 that it couldn't agree on the terms of an easement agreement with the Pension Trust Fund of the Operating Engineers. The easement is required for construction of the bridge.
David R. Howard, director of real estate for McMorgan & Co., the PTF's San Francisco investment manager, said last week that the disagreement involves a "narrow issue. … It's who needs to take on the liability. It shouldn't be us. I think that's really the sticking point right now." Howard maintains that "a financially responsible owner developer" needs to take on the responsibility during the construction phase of the bridge project. In the easement agreement proposed by the RMA, the bridge contractor provides $5 million of insurance to protect landowners against liability while their property is accessed during construction under the terms of the contract with the Parks Committee. According to Howard, the committee "is not a financially responsible owner," has no assets, and lacks authority to build park facilities. The RMA's position is the PTF's liability is covered by the insurance that bridge contractor Viking Construction is offering to the entities that are granting easements -- the PTF, the Community Services District, the Country Club and the owners of the Granlees estate. "Viking went way out of their way to accommodate the Pension Trust Fund. They wouldn't normally have to indemnify the grantors of the easement," Gumbinger said last week. "This indemnification was above and beyond the insurance coverages that would normally be provided by the bridge builder." Howard, who usually keeps a low public profile, is willing to offer a different view. "(RMA)'s telling us that Viking's insurance should be sufficient, their bonding should be sufficient. Whether that's sufficient or not, our point is that's not our decision to be making," he said. "If they think it's sufficient, fine. They can rely on that insurance policy of the contractor's and indemnify us. We shouldn't have to accept that responsibility. If you've got a $5 million policy, what if there's a $10 million claim? Then we have to pay or our insurance carrier has to pay. We're the innocent landowner. Why should we be put in that position? If they think it's sufficient, they should take the risk." Howard said the PTF "isn't a big, mean-spirited, for-profit corporation. These are retirement benefits for workers and we have a fiduciary responsibility to protect them. … Say something happens during the construction of that bridge. … Clearly, we're perceived as the deep pocket. … Once the $5 million policy that the contractor has is (depleted), then our insurance has to kick in. Why should we even be in that position? Or if there are cost overruns … in excess of the bonding capacity, we'd have to be posting money. "We shouldn't have to be in those positions," he said. "We're providing easement across the property and the RMA should be taking on the responsibility and the liability attendant to building the bridge." Howard said the PTF's concerns about liability are based on a worst-case scenario, even though the contract with Viking is for a fixed price and the PTF is "confident of (Viking's) ability to complete construction." Both the RMA and the PTF say the easement issue involves the construction phase of the project and not the permanent easement for the use and maintenance of the bridge. The RMA is accepting liability for the completed bridge, which it will own, once it's built. The PTF, the developer of Rancho Murieta for more than 30 years, owns most of the remaining undeveloped land here and the land leased by the Country Club for its facilities. Howard said there are two ways to resolve the issue from the PTF's point of view -- the RMA can accept the same level of responsibility for liability in the construction phase as it is willing to assume after the bridge is built, or the association can take over ownership of the property from the PTF before construction and eliminate the need for the easement. The bridge would be built in what has been designated a resource protection area, property belonging to the PTF that's on either side of the river. The county decided to protect the strip of land in the 1970s, when planning for the community was being approved. "We can give that whole area to the RMA, which I think the RMA has wanted to do in the past so they can control access to it," Howard said, referring to the county easement on the property. To support his contention that the RMA initially assumed the liability for both the construction and permanent easements, Howard quoted from the brief document he said the RMA sent him in February requesting a right-of-way for "digging, constructing, reconstructing, repairing and forever maintaining" the bridge. "It was one easement, and they were the easement holder," he said. Howard thinks the easements were separated by RMA counsel after the PTF responded to the easement request with "a variety of questions" in April. From this point on, it became a dialogue of the lawyers. "This is not the simple matter some have suggested," Howard said. "(The project) crosses our property, it crosses property the county has an easement on, it crosses property the folks who own the Granlees Estate own, it crosses property the Country Club leases from us, it crosses property that the Community Services District already has existing easements on. So all those people are involved because this is yet a new right of someone to cross all that stuff, is the most simple way to put it. So there are a whole variety of issues to solve. But that's what the lawyers do." As the lawyers started working on drafts of the agreement, "this notion of a temporary easement with some other party and then a permanent easement with RMA as the easement holder … just evolved," Howard said. Gumbinger denies that any shift occurred, saying, "We never changed any horses on them." The RMA's attorney, Steven S. Weil of Berding & Weil, LLP, declined to comment on the matter. Kathryn Henricksen, the RMA's general manager, described the negotiations as “extremely frustrating." "Every time a condition was either negotiated and-or met," she said of the PTF, "they came back to the table with additional conditions. They were never satisfied.” RMA counsel drew up drafts of two documents, a temporary easement during construction and a permanent easement for access after construction of the bridge. (See the documents here and here.) Gumbinger said there were several versions of the agreement and "we thought that we had finally arrived where everybody was happy." In June, the CSD board passed a resolution approving the draft agreements. "At least from RMA's perspective, this has passed muster through PTF, going back and forth through RMA and PTF attorneys, and that's why it's been delayed so long," CSD General Manager Ed Crouse told the district board before the vote. Crouse said the CSD board had granted tentative approval in January for the use of the district's easements on the levee and on Bridge House Lane. He said the two draft easement agreements had been reviewed by CSD legal counsel and were considered consistent with the board's tentative approval in January. Things apparently went downhill from there, culminating in a letter from Howard on July 27. The letter was sent directly to Gumbinger, bypassing both PTF and RMA attorneys. The PTF's version of the easement agreement was attached to the letter. It called for the RMA to indemnify the PTF during the construction phase. Gumbinger said the RMA board voted unanimously to reject the PTF agreement. Henricksen said the RMA's legal counsel has responded to the PTF's proposed agreement and "invited them to consider the easement the PTF and the association had been discussing up until the end of July."
How the bridge project began Two years ago, when the RMA took its plan for a bridge to the county, many believed the project would never get this far. The doubters -- local officials and developers alike -- believed government agencies like the Army Corps of Engineers would not grant permission for the bridge to be built, given the status of the environmentally sensitive Cosumnes River. The only one willing to express these doubts on the record was developer Gerry Kamilos, half of the PTF's development management team for Rancho Murieta. In a letter
to RanchoMurieta.com in November 2002, he wrote, "Personally,
I have worked on securing some of the most complex project permits
in this region. I would rather attempt to walk barefoot and without
water across the Mojave Desert than attempt to secure the permits
necessary to put another crossing over the Cosumnes." After being challenged by a letter from a reader who wants a bridge, Sample replied in a follow-up, "Bottom line is that I too want a bridge. I also want it to be done right. Would you go buy a car or house without doing comparison shopping? Our elected community leaders are in the process of doing just this. We deserve better." The funding agreement signed in 2003 by the county, South developer Reynen & Bardis and the RMA calls for the bridge funds, paid by Reynen & Bardis, to go for alternative projects if the bridge isn't built by 2008. The funding agreement was based on Viking Construction's proposal to design and build the bridge at a set cost of $1.5 million. The contract, along with its cost guarantee, expires at the end of this year. Henricksen said it's estimated the remaining cost of the project could increase by 15 percent due to the delay. The Parks Committee could be responsible for the additional costs since the contract is between the committee and the bridge builder. The Parks fund is made up of contributions from developers and RMA member dues. The contributions are based on a per-unit fee for all new construction on the North and South. The Parks Committee set a limit on what could be spent on the initial design and engineering phases of the project to insure that the funds wouldn't be used up if the bridge turned out to be an impossibility. The bridge project was developed by the RMA, working with resident Randy Jenco, owner of Viking Construction, to satisfy a condition for a river crossing the county placed on the South developer in the early 1990s. Reynen & Bardis had asked the county for relief from the condition after failing to secure the use of the Yellow Bridge to satisfy it. Instead, the county supported the plan for the new bridge and required the developer to fund it. In exchange, Reynen & Bardis was released from the obligation to provide a bridge and allowed to continue building on the South past the 600th home. Reynen & Bardis made a payment of $450,000 and guaranteed the remainder of the cost with an irrevocable letter of credit according to the terms of the funding agreement. Future development on the North is required to pay a fee of about $850 per unit under the terms of the amended ordinance. The Community Services District took on the role of lead agency for the bridge and accepted the environmental document for the project, a mitigated negative declaration, at a special meeting of the CSD board in January. The only challenge to the project at the meeting came as the board addressed the comments submitted by Sample, the RMDCCC member. (Correction: An earlier version of this story said Sample presented his objections in person.) After discussion, the board decided the mitigated negative declaration met the requirements of the California Environment Quality Act and accepted it. This opened the door to securing permits for the project. In April, the Parks Committee voted to authorize a request for the release of close to $500,000 for the fabrication of the bridge superstructure after three of the four required permits had been secured. The fourth was issued in June. At the April meeting, the committee was told the project was on schedule. The committee has not met since then and no update on the project has been issued. Last week Gumbinger provided the news that the fabrication of the bridge had gone forward and Reynen & Bardis had paid the contractor in late July.
|
|
