• Full text of Letter Agreement is here
• Full text of Mutual Benefit Agreement is here

Published Sunday, July 6, 2003

The Rancho Murieta Association has cleared the way to obtaining ownership of the community's parks by agreeing to dismiss a long-standing lawsuit against the Pension Trust Fund of the Operating Engineers.

RMA President Michael Schieberl said that by agreeing to the dismissal, the RMA and the PTF accepted the terms of the 1997 Letter Agreement as the final settlement of legal actions -- suits and counter-suits -- that arose from the financial collapse of developer Jack Anderson in the 1990s and a 1991 agreement to finance a parks-development fund.

The Parks Agreement was among the RMA, Community Services District and the PTF, which began developing the community 30 years ago.

The filing for dismissal was made late last month, a day before the RMA and the PTF were scheduled to appear in court again about the settlement. The RMA's lawyer and the PTF's lawyer have been meeting before a judge several times a year for years to say a final settlement hasn't been worked out yet.

The Letter Agreement provides for the RMA to receive title to Stonehouse, Riverview and Clementia parks, and undeveloped park sites at Lake Calero (approximately eight acres), at the north end of Murieta Parkway (approximately 10 acres) and in the Greens subdivision on the South (approximately two acres).

The agreement states that the RMA has the right to acquire an additional 20 acres of park land adjacent to Clementia Park.

With the exception of Stonehouse Park, the park sites are owned by the PTF.

Stonehouse is currently owned by the CSD and leased to the RMA. The Letter Agreement provides a three-way land swap in which the CSD receives a 10-acre industrial site owned by the PTF in exchange for conveying the 26-acre Stonehouse site to the RMA.

RMA General Manager Greg Vorster said the parks could belong to the RMA by the end of August. They will be designated as common area.

The Letter Agreement has stirred controversy since it was publicly released last December, five years after it was negotiated.

The agreement specifies that new development which does not annex to the RMA will have access to the parks by signing the Parks Agreement and paying into the Parks Fund. Residents of the non-annexed subdivisions would be obligated to pay a share of the RMA's cost to maintain the parks.

Development opponents charge that these terms took away the RMA's bargaining power with the developers.

Some of the Letter Agreement terms appear in expanded form in the Mutual Benefit Agreement, the blueprint for new development proposed for Murieta North.

In January, the RMA board approved the MBA and characterized it as an addendum to the Letter Agreement.

The MBA, the result of 2 1/2 years of negotiation among the RMA, PTF and developer Murieta Holdings, acknowledges that the new development of approximately 1,100 homes will not annex to the RMA.

In the MBA, the cost obligation for maintaining the parks is expanded into an agreement for residents in the non-annexed areas to pay the same dues as RMA members.

Schieberl explained that, "The MBA is offered up as the further clarification of what the Letter Agreement states. Both parties [RMA and PTF] agree that this information is encompassed in the MBA. Therefore, both parties are satisfied that the terms and conditions of the Letter Agreement have been met. There is still a connection between the two documents."

But dismissal of the lawsuit against the PTF means the terms of the Letter Agreement, not the MBA, go into effect.

"The MBA as a document that is binding upon the land is a whole different issue (from the Letter Agreement)," Schieberl said.

In negotiating the MBA, "Both parties expanded what they wanted from that Letter Agreement," Vorster explained. The PTF wanted access to the development and the RMA wanted the full assessment and a new North Gate, among other things. Negotiations for the MBA "started building on the original letter agreement," he said.

As a result, the MBA includes the legally-required pieces of the Letter Agreement and other negotiated values -- principally $1.4 million from the PTF for a new front gate, road-impact fees, $75,000 for an Escuela gate, as well as the mandatory dues contributions to RMA from homeowners in the new areas, who, as things stand, will not be a part of RMA.

Under the MBA, the 20 acres of park land next to Lake Clementia Park would be provided to the RMA at no cost as a tree mitigation area.

The MBA also includes an agreement allowing the developer access to the community, which the PTF wanted as part of the Letter Agreement, but didn't get, RMA officials say.

As for when the MBA will be signed and recorded to become a running obligation on property in the new subdivisions, Schieberl admitted, "I have no darn idea and I wish I did."

He added, "I have faith that it will eventually be signed."

None of the principals will comment publicly on the reasons for the delay in signing the document.

"If the MBA is not signed, we'll go back to our original position, that we're opposed to their development and they don't have access through our gates," Vorster said.

At this time, the first two projects of the proposed development -- the Residences of Murieta Hills and the Retreat projects, a total of 333 homes -- are still in the county planning process.