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Council approves alternative financing plan for Crossroads West mixed‑use project
Summary
City Council approved an operating memorandum enabling MU‑1 (Crossroads West mixed‑use) to satisfy development‑agreement maintenance obligations through an alternative financing mechanism tied to project‑generated sales and property tax revenues; council vote was 5‑0.
The City Council on April 22 adopted a resolution approving an alternative and equivalent financing mechanism to satisfy maintenance and service obligations tied to the MU‑1 mixed‑use parcel in the Crossroads West specific plan.
The development agreement between the city and Western Pacific Holdings, Inc. (the MU‑1 developer) had anticipated three options for financing maintenance of common improvements: annexation to the citywide Community Facilities District (CFD 2016‑1), creation of a new CFD for the development, or an alternative financing mechanism. The developer proposed option 3: use of additional sales and property tax revenue generated by the project, coupled with an operating memorandum (Operating Memorandum No. 2) that documents the parties’ responsibilities.
City staff said the alternative mechanism would cover items not otherwise maintained by the developer itself and would preserve the typical city obligations—such as repair and replacement of public street lighting, maintenance of medians, off‑site storm piping, and maintenance of Machado Parkway—while the developer would continue to fund irrigation, electric metering and frontages and assume on‑site maintenance responsibilities. The residential portion will be gated with on‑site management and private security; the city retains responsibility for general law enforcement response.
A representative for the development team described a long partnership with Riverbank and positioned the firm as a long‑term owner/operator focused on high‑quality tenant mixes and sustained property management. The developer projected that Crossroads West would generate roughly $4 million annually in sales tax revenue and an additional $230,000–$250,000 in property tax annually when complete, and estimated 1,000–1,200 ongoing local jobs plus more than 1,000 construction jobs during build‑out.
Council discussion focused on the mechanics of the split in responsibilities and the city’s continued accountability for off‑site or public infrastructure. Several council members asked the developer to keep the city informed as tenant leases mature so the council and residents are not surprised by public announcements; the developer explained that confidentiality clauses in large tenant leases sometimes prevent public disclosure of tenant names until agreements are final.
The council then approved the resolution (option 1 under the staff report’s options for tonight) authorizing the alternative financing mechanism and directing the city manager and city attorney to finalize the operating memorandum; the roll call vote was 5‑0.
