Council approves $2.856 million reimbursement agreement for F‑Street infrastructure

The Oakdale City Council on Feb. 18 approved a reimbursement agreement with Tesoro Homes Inc. that will repay the developer $2,856,246.60 for infrastructure improvements installed in the F Street Corridor specific-plan area.

Staff said the financed elements included streets ($2,200,000 approx.), water ($265,000), sewer ($131,000) and storm drainage ($211,000). The repayment is structured through a split of capital facilities fees (CFF) and plan-area fees (PAF): about 35% (roughly $999,000) will be repaid from the capital facilities fee portion and about 65% (roughly $1,857,000) from the plan-area fee, per the finance plan in the staff report.

City staff explained the reimbursement practice: a developer constructing infrastructure as a condition of approval can be repaid over time as other developments pay applicable fees that benefit from that initial construction. Staff said Tesoro Homes installed D Street and other components that provide circulation and utilities that future builds will use. The finance plan allocates costs and establishes credits so subsequent permits or fee payments go toward reimbursements.

Council discussion included questions on who pays and whether the developer had already recouped costs. Staff said Tesoro initially financed the work and will receive credits and reimbursements as future homes are built and fees are paid; some fee payments the developer already made will be applied against the reimbursement. The agreement does not draw from the general fund; it uses CFF and PAF revenues tied to development.

The motion passed 4-1 on the roll call (Council member Gilbert: yes; Mayor Pro Tem Smith: yes; Council member Potassie: no; Council member Kettering: yes; Mayor Barrios: yes). Staff said the reimbursement follows existing city practice for earlier infrastructure projects and will be administered under the finance plan in exhibit C of the staff report.