Dublin School Board Set to Vote on $28.2M Deal with SCS Development for “At Dublin” Project

DUBLIN, CA–SCS Development, the owner of 76.1 acres along Tassajara Road near Dublin Boulevard, and developer of the planned At Dublin project, have reached an Agreement with the Dublin Unified School District for the accelerated payment of $28.1M in development fees plus an additional contribution of up to $100,000 towards the development costs of a preliminary schematic design for the future high school at the Promenade site. This agreement is conditional on the City of Dublin’s exercise of its discretion whether to approve the development.

[UPDATE 10/23/18 – The Dublin School Board voted 3-1 in favor of the Agreement. A short signing ceremony with representatives from SCS Development was held after the vote.]

“At Dublin” Project Concept

The proposed Agreement is available here and more details on the project from the City of Dublin are available here. The Dublin School Board is scheduled to debate and vote on the agreement at tonight’s Board of Trustees Meeting (5:30pm in the DUSD Boardroom).

According to information provided by DUSD, the “District takes no position as to whether the development should or should not be approved, as that is a matter entirely within the City’s sole jurisdiction. However, the District must take all steps necessary to ensure the availability of adequate school facilities in the event that the City does approve development. The agreement reached with AT Dublin gives assurance that adequate school facilities will be available for students who would reside in the project if approved. The agreement does so by providing for funding equal to the full mitigation of the school facilities impact of the project, at a level previously unprecedented in the District. The effect on the District is therefore neutral with or without project approval.

“The up-front mitigation payment provided for by the agreement is more than twice the statutory amount SCS is legally required to pay. The payment is being offered by SCS to help DUSD with its facilities needs, including the purchase of land and development of a new high school. The District recently selected and is moving forward with the Promenade site as the best option for the location of a Dublin high school. The high school will be designed for an ultimate capacity for 2,500 students, with the first phase to be built including capacity for 1,000 students.”

According to the proposed Agreement, SCS plans for the 76.1 acre site include:

General Commercial:

• Commercial 203,343 square feet
• Hotel 75,000 square feet/150 Keys

Mixed Use:

• Commercial 79,895 square feet
• Multi-family apartments 280 units/356,632 net rentable square feet (exclusive of the parking structure)

Residential:

• Townhomes 205 units/413,015 net square feet
• Single Family Detached 180 units/459,476 net square feet

Enrollment at Dublin High is over 3,000 students, and is estimated to grow by another 1,300 students within the next five years. While the AT Dublin project is projected to generate approximately 5% of those 1,300 high school students, SCS’s $28.1 million payment represents almost 30 percent of DUSD’s allocated funds for the initial phase of the new high school. The full amount would be paid on a schedule that will bring in the funds well in advance of when statutory fees would have been due. This will give the District greater funding choices as it moves forward with its school planning and construction. The Project, if approved by the City, is anticipated to generate approximately 323 students that will need to be housed in District facilities.

“We appreciate the initiative of SCS to sit down with the District early on and work with us in reaching this agreement,” says Amy Miller, Board President of DUSD. “Clearly, SCS understands the needs of our District, particularly our limited ability to access new funding sources, especially at the state level. This level of mitigation from SCS, unprecedented in our District, provides critical additional funds which will be instrumental to our facilities program, including our new high school should the AT Dublin project be approved. The agreement is critical to achieve the District’s goal that the impact of development will be at least neutral on the District, with the developer fully funding the cost for any new facilities needed to house students from that development.”

“Given the projected student growth, one of the District’s priorities is to take immediate action to acquire and plan for a high school,” says Dr. Boozer, Superintendent. “The accelerated payment agreement for SCS’s development fees and its $100,000 donation will help the District jump start the design and planning for the new high school.” Students who would live in the AT Dublin community are not expected to begin enrolling in Dublin schools until 2022. AT Dublin is planned to be fully built-out by 2025 and is projected to contribute 188 kindergarten through 5th-grade students, 71 6th through 8th-grade students, and 64 9-12-grade students.

Additional details provided by DUSD:

The District is currently authorized by law to impose “Level 2” school impact fees on development at the rate of $11.00 per square foot of residential development and $0.61 per square foot of commercial development. Based on these rates and the proposed square footage of the Project, it is estimated that the Project would generate approximately $13,529,190 in statutory impact fees.

The District and the Developer have been in discussions for many months regarding an agreement by which the Developer would assist the District with its ongoing efforts to provide adequate school facilities for students generated by new development in the District. The parties have reached a proposed agreement, pursuant to which the Developer would make two lump sum payments of $14,050,000 each (respectively, the “Contribution” and the “Additional Contribution”), as well as a $100,000 “Gift” toward the District’s design of a new high school at the Promenade site, for a total payment of $28.2 million. The initial Contribution would be paid on the earlier of: (a) 12 months after approval of the Project by the City, or (b) issuance by the City of the first residential building permit for development of the Project. The Additional Contribution would be paid no later than 12 months after payment of the Contribution. The Agreement also calls for the payment amount to be adjusted in the event that more or less commercial square footage or residential units are approved on the Property compared to what is currently being proposed.

Additionally, the Agreement would require the Developer to use its best efforts to request that the City direct $5 million of public facility or community benefit fees generated by the Project toward the construction of a joint use gymnasium to be constructed on the future Dublin Crossing school site, or another site that is mutually agreed to by the District and the City.

In part because of the availability of land at the Dublin Crossing site for a K-8 school at a very low cost to the District under a separate agreement with the City entered into earlier this year, and in part because of the unprecedented amount of facility funding being proposed by the Developer, it is anticipated that the Project will have no unfunded impact on the District. The agreement thus achieves the District’s objectives to have development impacts in the District fully mitigated. The effect of approval of the Project by the City is therefore neutral on the District, with the agreement providing full mitigation in the event that the City exercises its discretion to approve the Project.

DUSD and SCS Development sign the Agreement during the 10/23/18 Board Meeting