Report Prepared by: Julie Nelson, Acting Planning Manager, Development Services Department
Title
SUBJECT: Public Hearing - Annexation and Prezoning Application #22-01, Initiated by the City of Merced, on Behalf of the Regents of the University of California, Property Owners; the Application Would Involve the Annexation of the University of California, Merced Main Campus as Described in the University of California, Merced 2020 Long-Range Development Plan (Dated March 2020) Consisting of Approximately 1,125 Acres to the City of Merced and Prezoning of the Property to “Public Facility” (P-F) as well as the Annexation of the 2-Mile Long Section of Bellevue Road Right-of-Way from the Current Merced City Limits at G Street to Lake Road (Approximately 14 acres) for a Total of 1,139 acres, as Allowed by Assembly Bill 3312 (Enacted in 2020) for a Total Annexation Area of 1,139 Acres. The University of California Campus is Generally Located at the Northeast and Southeast Corners of Bellevue and Lake Roads with a General Plan Designation of “School.” This Request also Includes the Approval of Three Agreements Related to the Annexation of the University of California Merced Campus - 1) A Memorandum of Understanding Between the City of Merced and the Regents of the University of California Regarding Annexation of and the Provision of Public Services to the UC Merced Campus; 2) Amendment #1 to the Permanent Financing Capital Facilities Fee Agreement; and, 3) Amendment #1 to the Transportation Improvement Funding Agreement
REPORT IN BRIEF
Considers the annexation of the UC Merced Campus (approximately 1,125 acres) and a 2-mile-long section of Bellevue Road right-of-way from the existing City Limits at G Street to Lake Road (approximately 14 acres) for a total annexation area of 1,139 acres as allowed by Assembly Bill 3312. The report also considers the approval of three agreements between the City of Merced and the UC Regents of the University of California related to the annexation.
RECOMMENDATION
City Council - Adopt a motion:
A. Approving the Memorandum of Understanding by and between the City of Merced and the Regents of the University of California Regarding Annexation of and the Provision of Public Services to the UC Merced Campus; and,
B. Approving Amendment #1 to the Transportation Improvement Funding Agreement; and,
C. Approving Amendment #1 to the Permanent Financing Capital Facilities Fee Agreement; and,
D. Approving Resolution 2023-74, A Resolution of the City Council of the City of Merced, California, approving Environmental Review #22-15, an Addendum to the Merced Vision 2030 General Plan EIR, for Annexation/prezoning Application #22-01 for the UC Merced Annexation, generally located at the northeast and southeast corners of Bellevue and Lake Roads as well as the 2-mile section of Bellevue Road Right-of-Way from the current Merced City Limits at G Street to Lake Road and approving Environmental Review #23-36 (Categorical Exemption) for the approval of the Memorandum of Understanding by and Between the City of Merced and the Regents of the University of California regarding Annexation of and the Provision of Public Services to the UC Merced Campus, Amendment #1 to the Permanent Financing Capital Facilities Fee Agreement, and Amendment #1 to the Transportation Improvement Funding Agreement; and,
E. Approving Resolution 2023-75, A Resolution of the City Council of the City of Merced, California, to the Local Agency Formation Commission for the annexation of the UC Merced Campus Generally located at the northeast and southeast corners of Bellevue and Lake Roads, as well as the 2-mile section of Bellevue Road Right-of-Way from the current Merced City Limits at G Street to Lake Road as allowed by Assembly Bill 3312; and,
F. Introducing Ordinance 2557, An Ordinance of the City Council of the City of Merced, California, Amending the Official Zoning Map by Prezoning the UC Merced Campus, generally located at the northeast and southeast corners of Bellevue and Lake Roads as Public Facility (P-F).
Body
ALTERNATIVES
1. Approve as recommended by the Planning Commission and staff; or,
2. Approve subject to modifications as conditioned by City Council;
3. Deny; or,
4. Refer back to staff for consideration of specific items (to be addressed in the motion); or,
5. Continue to a future meeting (date and time to be specified in motion).
AUTHORITY
Per the terms of the Agreement Affecting Real Property and Covenant to Annex between the Regents of the University of California and the City of Merced executed on June 14, 2016, UC Merced agrees to annex the UC Campus (including Phase 1 and the 2020 Project) when the City Council determines that the annexation shall be made. AB 3312, approved September 9, 2020, authorizes the City to annex the UC Campus under limited circumstances.
CITY COUNCIL PRIORITIES
“Future Annexations/Growth of the City” was listed under Goal Area #5 Future Planning in the City Council Goals and Priorities for FY 2020-21. Additionally, the Merced Vision 2030 General Plan includes policies for the City to work the University of California on annexation of the UC Merced Campus. On February 16, 2021, the City Council directed staff to initiate the annexation process of the UC Merced Campus.
DISCUSSION
Annexation/Prezoning application #22-01 proposes to annex the approximately 1,125-acre University of California Merced Long Range Development Plan (LRDP) area as well as the 2-mile-long right-of-way for Bellevue Road from G Street to Lake Road (approximately 14 acres) (Attachment 1). The UC Campus land would be prezoned “Public Facility” (P-F).
The UC Merced Campus is within the City’s Specific Urban Development Plan (SUDP) and Sphere of Influence (SOI). The UC Merced Campus has a General Plan designation of “School.” The campus is surrounded by mostly vacant land, rural residential single-family dwellings, and Lake Yosemite. None of the surrounding area is within the City Limits, but much of it is within the City’s SUDP/SOI. The table below and the Location Map at Attachment 1 show the surrounding land uses.
Once the UC Merced Campus is annexed, other properties in the area would be eligible for annexation. Assembly Bill 3312 does not allow property along the Bellevue Corridor to be annexed, but it does allow the properties adjacent to the UC to be annexed. As shown on the map at Attachment 2, the City has received applications for other annexations in the area adjacent to the UC campus. Upon completion of UC Merced annexation, these annexations would be able to move forward. Additional information on AB 3312 is provided below.
|
Surrounding Land |
Existing Use of Land |
City Zoning Designation |
City General Plan Land Use Designation |
|
North |
Lake Yosemite & Conservation Land |
County |
County (Outside the City’s SUDP/SOI |
|
South |
Virginia Smith Trust Land (proposed for annexation) |
County |
UC Community Plan |
|
East |
Farmland |
County |
County (Outside the City’s SUDP/SOI |
|
West |
Vacant & Rural Residential Homes |
County |
Bellevue Community Plan & Rural Residential |
AB 3312
During 2020, AB 3312 was introduced in the California Legislature by District 21 Assembly member Adam Gray. AB 3312 passed both the House and Senate unanimously and was signed into law by the Governor on September 9, 2020. The final text of AB 3312 can be found at Attachment 3. In summary, AB 3312 allows the City to annex the main UC Merced Campus through a “road strip” (Bellevue Road) annexation and places certain restrictions on future annexations along the “road strip.” The “road strip” being used is Bellevue Road. Therefore, once the UC Merced annexation is completed, other properties along Bellevue Road would be eligible for annexation.
General Plan Policies
The Merced Vision 2030 General Plan was adopted in 2012 and contains several policies related to annexations and specifically annexation of the UC Merced Campus. Policy UE 1.4 includes an implementing action related to a policy statement from City Council Resolution #2006-89 regarding the University Community Plan Area. Policy UE-1.3 includes criteria to evaluate each individual annexation. The policies and implementing actions as well as the evaluation of the criteria regarding annexation are provided at Attachment 4.
Police and Fire Services
The University of California has its own police force, including a police department located on the UC Merced campus. The police department would remain in tact upon annexation of the UC Merced campus and would be the primary source of policing for the campus. The UC Police Department currently works with the City’s Police Department when needed to resolve any issues that extend beyond the UC Merced campus. This relationship would continue upon annexation of the campus.
UC Merced currently contracts with the county for fire services. Upon annexation, the City would be responsible for providing fire services to the campus.
Memorandum of Understanding and Amendments to Agreements
In addition to taking action on the annexation of the UC Merced Campus, the City Council is being asked to approve a Memorandum of Understanding (MOU) related to the annexation as well as amendments to two agreements between the City and the Regents of the University of California.
The Memorandum of Understanding by and between the City of Merced and the Regents of the University of California Regarding Annexation of and the Provision of Public Services to the UC Merced Campus found at Attachment 5 outlines the past agreements between the City and the UC regarding annexation and confirms that the UC would retain full powers of sovereignty and self-governance and that the UC Merced Long Range Development Plan (LRDP) is the sole cap or limitation on the amount and type of development and uses on the UC Merced campus. The MOU also states and confirms fees related to water and sewer services.
Amendment #1 to the Permanent Financing Capital Facilities Fee Agreement (Attachment 6) states in part that as other properties connect to the existing sewer and water facilities along Bellevue Road, the City shall collect fees from those developments and deposit those fees into the University Capital Charge Fund held by the City. These fees shall be used to reimburse the UC for the costs of installing the lines in Bellevue Road.
Amendment #1 to the Transportation Improvement Funding Agreement (Attachment 7) states in part that Section 1, Truck Routes and Roadway Construction Impacts of the original agreement are no longer operative as construction of the UC has completed construction of the revised 2020 Project. It also states that as development occurs along the Bellevue Corridor, the City shall collect a pro-rata share of the cost for the expansion of Bellevue Road from two lanes to four lanes from G Street to Lake Road.
Details on the original agreements are provided in the Background section of this report.
Future Development
Although the UC Campus would be incorporated into the City Limits upon annexation, the UC Campus would not be subject to the typical land use controls that other properties within the City are subject to. As stated in the MOU, the UC would retain all land use controls and development would be subject to the UC Merced LRDP. However, the UC would be required to install any infrastructure needed to accommodate any future development. This infrastructure would include, but is not limited to, sidewalk, curb, gutter, streetlights, and street trees.
Pre-Annexation Development Agreement
Section 20.86.150 of the Zoning Ordinance requires a property owner to enter into a Pre- Annexation Development Agreement prior to annexation. However, because the University of California has already entered into an Annexation Agreement with the City and is not subject to the City’s land use authority, no Pre-Annexation Development Agreement is necessary.
Environmental Review
The City contracted with Ascent Environmental to prepare the environmental review document for this annexation as required by the California Environmental Quality Act (CEQA). An Addendum to the Merced Vision 2030 General Plan Environmental Impact Report (EIR) for the UC Merced Annexation Project was prepared and concluded that the annexation project would not result in significant new or substantially more severe environmental impacts than described in the previously adopted Merced Vision 2030 General Plan EIR (adopted in January 2012). The addendum is provided at Exhibit C of the City Council Resolution Attachment 10.
The City conducted an environmental review regarding the approval of the MOU and amendments to the agreements. It was determined that this action would be exempt from CEQA and a Categorical Exemption is being recommended. The Categorical Exemption is provided at Exhibit D of the City Council Resolution at Attachment 10.
Background
Previous City Council Action
At the February 16, 2021, City Council meeting, City staff presented information regarding the advantages and disadvantages of annexing the UC Merced Campus along with information on the annexation application process. The City Council, by unanimous vote, subsequently directed City staff to initiate the annexation of the UC Merced Campus and begin the environmental review process. On October 18, 2021, Ascent Environmental was awarded the contract to prepare the environmental review document.
UC Merced Agreements
In 2003, the City and the Regents of the University of California entered into three agreements related to the construction of the UC Merced Campus. These agreements included an Urban Services Agreement, an Agreement to Annex and a Permanent Financing Capital Facilities Fee Agreement. These agreements are described below.
The Urban Services Agreement is an agreement for the City to provide wastewater and water services to the UC Merced Campus. Such an agreement was necessary since the UC Campus was located outside the Merced City Limits. As part of that Agreement, UC also signed an Agreement to Annexation agreeing to annex Phase 1 of the Campus to the City of Merced at the time that the City Council deemed it was appropriate. A new Water and Sewer Services Agreement was signed in 2016 and amended in 2019 to reflect the expansion of the Campus.
The Permanent Financing Capital Facilities Fee Agreement is an agreement for the financing of the construction of the water and sewer lines needed to serve the UC Merced Campus. This agreement also outlines payment of the required facilities fees for the water and sewer services provided by the City.
In 2016, UC Merced and the City entered into a Transportation Funding Agreement for the 2020 Project. This Transportation Agreement included provisions relating to: 1) truck routes and roadway construction impacts during construction of the 2020 Project; 2) UC’s funding obligations for Phase I of the Campus Parkway; 3) UC funding obligations for Campus Parkway Phase II and the portion north of Yosemite Avenue; 4) UC’s funding and construction obligations for improvements to Bellevue Road; 5) UC’s funding and construction obligations for improvements to Lake Road, including the intersections of Lake Road and Bellevue Road and Lake Road and Yosemite Avenue; 6) reimbursement provisions for University Community properties; and, 7) Transit Service improvements and bus stop locations for UC’s bus service within the City.
Planning Commission Action
On October 4, 2023, the Planning Commission held a duly noticed public hearing regarding the annexation of the UC Merced Campus. At the meeting Daniel Okoli, Ph.D., Vice Chancellor and Chief Operating Office for UC Merced spoke in support of the annexation. No one spoke in opposition. After discussing the matter, the Planning Commission voted unanimously (6, 0, 1 absent) to recommend approval of Environmental Review #22-15 and Annexation/Prezoning Applications #22-01 (refer to Planning Commission Resolution #4124 at Attachment 8). Planning Commission Staff Report #23-102 is provided at Attachment 9.
City Council Action
The City Council should hold a public hearing regarding the annexation of the UC Merced Campus. After the public hearing, the Council should consider the annexation and the approval of the MOU and amendments to agreements. Staff recommends the Council approve the following:
1) Memorandum of Understanding by and between the City of Merced and the Regents of the University of California Regarding Annexation of and the Provision of Public Services to the UC Merced Campus (Attachment 5); and,
2) Amendment #1 to the Permanent Financing Capital Facilities Fee Agreement (Attachment 6); and,
3) Amendment #1 to the Transportation Improvement Funding Agreement (Attachment 7); and,
4) The Resolution approving the Environmental Review documents (Attachment 10); and,
5) The Resolution authorizing an application to LAFCO for the annexation (Attachment 11).
Additionally, staff recommends the City Council introduce the Ordinance at Attachment 12 prezoning the annexation area as Public Facility (P-F).
IMPACT ON CITY RESOURCES
The annexation of the UC Merced Campus would increase the service area for the City. As mentioned above the City would not be primarily responsible for police services, but would assist as needed. The City would be responsible for fire services. The City currently provides sewer and water services to the campus.
ATTACHMENTS
1. Location Map
2. Other Annexations Near UC Merced
3. AB 3312
4. General Plan Policies/Implementing Actions
5. Memorandum of Understanding
6. Amendment #1 to the Permanent Financing Capital Facilities Fee Agreement
7. Amendment #1 to the Transportation Improvement Funding Agreement
8. Planning Commission Resolution #4124
9. Planning Commission Staff Report #23-102
10. Resolution 2023-74 Approving Environmental Review
11. Resolution 2023-75 Authorizing Application to LAFCO
12. Ordinance 2557 Prezoning Annexation Area
13. Presentation