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46 <br /> • <br /> 3. A small, financially prudent reserve for Redwood Peninsula <br /> improvements should be developed to allow for some ""% <br /> flexibility, cost overruns, or other contingencies. <br /> 4. Separate fee schedules for commercial and residential should *mai <br /> be adopted, possibly with an automatic inflation factor built <br /> in which is representative of the local area, i.e. , the Bay <br /> Area Builders Index. <br /> 5. Annual review of current, next year and five year improvement <br /> programs and adjustments of fee levels and application as <br /> required to meet District capital needs and reflect market <br /> conditions. <br /> Mr. Mac Quarrie commented and responded to questions by Council, <br /> indicating that with respect to the recommended small prudent <br /> reserve, there may be times when the improvements may cost more <br /> than what is available in funds, and the object is to not get into <br /> that situation, but that fluctuating market conditions or other <br /> influences must be taken into consideration. <br /> City Manager Fales referred to the recommendation for the annual <br /> review process, and emphasized its importance because as the <br /> development schedule proceeds, it will be come much closer. In <br /> response to comment, he added that the assumption is that the <br /> reserve funds would be trusted under GID No. 1-64, and would be <br /> for some specific purpose having to do with completion of projects <br /> within the Improvement District. He indicated that it was not <br /> believed necessary to accumulate the kind of reserves as suggested <br /> in the Bartle Wells Report, and that under the law, anything <br /> remaining can be used for maintenance, but there is no way of <br /> returning the funds to the people who originally paid it. Also, <br /> that staff believes, as the Advisory Committee does, that <br /> establishing a prudent reserve for project construction is a <br /> businesslike way to proceed, because of the volatile nature of the amol <br /> economy. <br /> Mr. Fales suggested that the agreement which he hopes Council will mod <br /> instruct staff to bring back to them for consideration will <br /> address the question of South Shores separately from Redwood <br /> Shores, and that separate time triggers will be built into those <br /> components of the agreement. <br /> City Manager Fales responded to further questions by Council, <br /> explaining that the reason the Bartle Wells Report raised the EDU <br /> (equivalent dwelling unit) for commercial from 1,500 sq. feet to <br /> 2,000 sq. feet is that at the previous study session Redwood <br /> Shores, Inc. had made effective appeals that for the three years <br /> after implementing the facilities charge, there would be a lesser <br /> fee for commercial development, because it would be to the benefit <br /> of the District to encourage full commercial development as <br /> rapidly as possible, being a relatively small, high-value area, <br /> and would produce a tax base that would be beneficial to both the <br /> homeowners and the developers. The difference in the EDU from the <br /> previous report by Bartle Wells was their way of achieving this. <br /> Mr. Fales advised in response to comment by Council that Council <br /> had never given staff specific instructions to prepare anything <br /> for their formal approval. <br /> M/S: Stangel/Rhodes to instruct staff to bring back a fee <br /> schedule to the City Council for its consideration./ <br /> ADDITION TO MOTION: At the suggestion of Councilman Chandler and <br /> with the consent of his second, Councilman Stangel added that <br /> staff be instructed to continue to develop a Development Agreement <br /> with Redwood Shores, Inc. for implementation. <br /> •ter <br /> Adi.Mtg. <br /> 5/21/81 <br /> Page 2 <br />