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Developer offers city $1.8M

Atherton Homes wants to revive bonus bucks

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Developer offers city $1.8M

A new home being built by Atherton Homes goes up in Union Ranch.

HIME ROMERO/The Bulletin

POSTED May 3, 2013 2:27 a.m.

Bonus bucks may start flowing again.

Atherton Homes is volunteering to pay $1,068,000 to bolster Manteca police and fire staffing plus contribute $712,000 for the municipal general fund for one-time expenditures as part of a development agreement they are proposing to allow them to build 356 single family homes  over the next five years in Southeast Manteca.

Bonus bucks is the shorthand name given to the money paid per proposed home  to assure sewer allocation certainty  over multiple years. It was implemented  in 1999 and then suspended 35 months ago. The arrangement made it easier for developers to secure financing for multi-year projects under Manteca’s 3.9 percent sewer allocation growth cap. It also headed off potential litigation between builders who requested 1,700 sewer connections in 1999 when the city couldn’t issue more than 650 single family housing permits that year.

The bonus bucks were on top of growth fees. Manteca collected almost $41.2 million over  11 years before bonus bucks suspended 35 months ago. The decision to hold the fees in abeyance was to whittle down the backlog of 970 finished lots by making the numbers work for a builder to go ahead and construct homes . There are  less than 100 lots left today.

The bonus bucks were billed as a way to have growth provide amenities for all of Manteca to share. And they did to a degree. They paid to cover about 60 percent of the Union Road fire station’s cost, build the skate park, install soccer lights at Woodward Park, place traffic signals along the Tidewater Bikeway and even cover the cost of aerial Fourth of July fireworks.

But a large chunk of the money ended up covering multiple year general fund shortfalls as the city scrambled to find ways to broaden the retail base and bring in employers to fill private sector business parks that in turn pumped up property tax receipts. Property and sales tax account for the majority of the municipal general fund that pays for day-to-day services such as police, fire, parks, and streets.

Over $12.2 million in bonus bucks were used over multiple years to bridge general fund deficits while the city worked with employee bargaining units to get Manteca’s financial house in order.

Bonus bucks also were used to establish an $8 million public safety endowment fund that is now paying the salaries of six police officers including the four man gang unit that was resurrected in July. The endowment is also helping build the new fire station on Lathrop Road via a loan that will be repaid as fire facilities fees are collected on new growth.

The development agreement covers two parcels that aren’t part of the 18,477 proposed housing units that were either approved for building or were somewhere in the approval process as of July 1.

Atherton Homes at Woodward Park II consists of 185 homes on 57.3 acres immediately west of Pillsbury Road south of Woodward Avenue. It will include the eastward extension of Tannehill Drive.

Atherton Homes at Woodward Park I is immediately south of Woodward Park II on 53.2 acres that also fronts Pillsbury Road but is located across from an orchard and not homes. That project encompasses 171 homes. It also borders  the approved 1,048-acre Austin Road Business Park and the future southern extension of Atherton Drive south of Moffat Boulevard.

A separated bike path would connect a park in the neighborhood with the extension of the Atherton Drive Bike Path south toward Ripon.

The proposed public safety bonus bucks fee comes to $3,000 per home while the general fund bonus bucks are $2,000 per home.

While that is $54,000 more than any developer is paying right now, it is down from the peak of $13,000 per home reached at the height of the housing market in 2005 when developers were charged higher fees when they built more homes in a given year.

The City Council will consider authorizing City Manager Karen McLaughlin to negotiate the development agreements when they meet Tuesday at 7 p.m. at the Civic Center, 1001 W. Center St.

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