The Capistrano Insider

No Surprise: Whispering Hills Sues School District

The dispute between Whispering Hills and Capistrano Unified School District has finally landed in court. This is over $6 million the developer says the school district owes it from the construction/land sales of San Juan Hills High School.

The district and developer have been fighting in letters over when the district was supposed to repay a $6 million bridge loan the developer made the district when Whispering Hills sold CUSD the land for San Juan Hills High.

According to the suit, the loan was supposed to be repayed when the district formed the CFD for the area. But the district says the CFD has not been funded -- no houses have been built --

Here's a copy of the suit.

The Fall Out of An Unfinished Community

Attorney Robert DeNichilo, representing the homeowners in the unfinished Pacifica San Juan project off Camino Las Ramblas, made this presentation to the Capistrano Unified School Board on July 6. Trustees did not act that night, but some said they found it an intriquing issue and asked staff to look into it. The city will also receive some money when the bond is actually issued. The money being collected now is apparently going into a bank account.

Also posted on the Beyond the Blackboard blog.

 

Good evening. My name is Robert DeNichilo, and I am corporate counsel for the Pacific San Juan Community Association. I have been asked by residents of Pacifica San Juan to address you this evening, and I thank you for your time and attention.

 First let me address the question of “why are we here.”  Pacifica San Juan comprises Community Facilities district 98-1 of the Capistrano Unified School District.  When the district was originally formed, the economy was in a very different state than it is today.  It was an era we now recognize as a housing bubble, and where demand far outstripped supply.  At that time, Pacifica San Juan was envisioned to be a community of 416 homes.  It was anticipated that such a community would have a large and real impact on the city, and in particular the school district and the services it provides its residents.

That was the environment where the rate of special tax to be levied was calculated.  An environment where it was envisioned that a 20 million dollar bond would be required to offset the impact of Pacifica San Juan on the school district, a number that was increased to 45 million dollars a few years later.  However, as we all know, we are in a very different situation today.

Rather than a community of 416 homes, Pacifica San Juan today, and for the foreseeable future, is comprised of 61 homes, only 54 of which have been sold and have families living in them.  Of these 54 homes, there are only 10 children attending school in the district.  Clearly this is a very different level of impact on the district than that which was envisioned when the CFD was created, and no one would have envisioned that it would take over 26 thousand dollars per student per year the residents have been taxed, or the 46 thousand dollars per student per year that I understand is being proposed, to offset the impact of the 10 children from Pacifica San Juan on the Capistrano Unified School District.

Despite the change in circumstances from what was anticipated at the time that the rate of special tax was determined, there has been no review of the real impact of Pacifica San Juan on the school district.

One impact is that there has not been any need for bonds to be issued.  In fact, until there is a significant change in circumstances it is unlikely any bonds will be issued. Further, once things do change, and development begins again, it is highly likely that any new developer will seek to change or eliminate the CFD, as the current rate of special tax negatively impacts on the marketability of the property.  In fact, it is my understanding that this may already be occurring in another community in the district.

We are in a unique situation here in light of the fact that no bonds have been issued in this CFD.  The Board is not hamstrung with debt that must be repaid by the special tax.  Rather, pursuant to Government code section 53330.5, this Board has the authority and power to reduce the rate of special tax currently being levied on the properties in Pacifica San Juan.  It is my understanding that this has been done by other districts where development in a community comes to a halt, as has happened in Pacifica San Juan.

The residents of Pacifica San Juan would like to work collaboratively with the Board to lower the rate of special tax on this CFD, with flexibility that may be required as circumstances change and development resumes.  In this light, pursuant to government code 53332, the residents will be filing petitions requesting that the Board adopt a resolution reducing the rate of special tax on Pacifica San Juan.  We look forward to working with you on this issue in the coming days.

No Humanity: Someone Rips off Habitat

The Habitat for Humanity project at the east end of Calle Rolando off Alipaz was broken into sometime late Friday/early Saturday, with crooks getting away with between $2,000 and $2,500 in tools and equipment.

Habitat officials said they have insurance, but it carries a $1,000 deductible. Plus, they'll have to spend more money to upgrade security at the site. Habitat is building 27 units in San Juan Capistrano, about half of which will house wounded veterans of servicemembers.

For more information about the project, see www.habitatoc.org

What's the Right Way to Deal With Residential Overcrowding?

Homeowners Associations have several tools they can use to battle residential overcrowding in their neighborhoods, according to information provided during a meeting sponsored by the city of San Juan Capistrano earlier this month.

Associations can use their CCRs to limit household occupancy and ensure that garages are used for parking vehicles, as well as write rules that prohibit property owners from renting to anyone but families, including setting minimum lease durations, according to the information provided by attorneys on behalf the city. Associations can even require property owners provide them a copy of the lease.

Council members on May 5 complimented the meeting, which drew about 40 people. Councilmember Laura Freese told her colleagues she’d like the city to sponsor another meeting to further spread the word.

Click here to see a copy of the report.

Here's my column from this week, in which I share some thoughts:

I understand the damage residential overcrowding can do to a community, but I’m still not convinced the path the City Council is taking to address it—an overnight parking ban along Camino Capistrano—is the right road to take the solution.

First off: I don’t buy into the suggestions the ban was about safety, increasing use of the park there or even aesthetics. It was an overnight parking ban: Any benefit would come between 1 a.m. and 6 a.m. Minimal impact, at best, to anything except to stifle the use of the street for overflow parking from nearby neighborhoods.

And even that impact—100 spaces between two high-density neighborhoods—would be minimal, too.

If the City Council wants to get serious about the aesthetic appearance of our roadways, great. A better starting point would be Alipaz, south of Del Obispo, which is always lined with cars and flooded with trash. And if the City Council wants to get serious about overcrowding, then it should step up and address the issue directly and openly.

The forum for homeowner’s associations was a good first step, because the law gives associations more power to control home occupancy than it gives to cities. So far, the city’s parking ban has drawn opposition from residents, and the homeowner’s associations, too. Escondido went down this road, only to become mired in a years-long battle that ended with no new parking bans. No steps forward.

The destination the council wants to reach is laudable; but the route they’re embarking on is likely to lead in the wrong direction.

Is There an Affordable Housing Project Headed Toward Your Neighborhood?

Actually, it's a long shot that many of these projects would happen, but the new members of the Housing Advisory Commission received a briefing on potential projects in San Juan Capistrano.

Two look most likely: Some sort of assisted-living project at the northwest corner of Camino Capistrano and Junipero Serra, and at Camino Las Ramblas and Via California -- if the city can buy that land. Also, the Distrito La Novia project, a mix of housing, retail and commercial on the land above Valle Road, between San Juan Creek and La Novia.

Remember, the city has to spend 20 percent of the money it makes in the redevelopment area on affordable-housing projects, so there's money to make some deals. Additionally, the City Council just raised the amount of money developers have  to pay if they do not include affordable units in their developments. It used to be 1 percent of a project's value, which averaged about  $370,000 a year for the city -- hardly enough to build a single unit. Now, it's $10,000 per unit.

Here's the list of potential projects.