USA v. State of California et al

Filing 1

COMPLAINT against All Defendants by United States of America. (Attachments: # 1 Exhibit 1, # 2 Exhibit 2, # 3 Exhibit 3, # 4 Exhibit 4, # 5 Exhibit 5, # 6 Exhibit 6, # 7 Civil Cover Sheet)(Grant, Eric)

Exhibit 5

STAFF REPORT

C86
A

16

S

02/27/18
S. Pemberton
P. Huber
E. Kennedy

7

EXERCISE RIGHT OF FIRST REFUSAL TO CONSIDER ACQUISITION OF
FEDERAL PUBLIC LANDS OR RIGHT TO ARRANGE FOR THEIR TRANSFER TO
ANOTHER ENTITY IN THE CITY OF DUBLIN, ALAMEDA COUNTY
APPLICANT:
Dublin Crossing, LLC
AREA, LAND TYPE, AND LOCATION:
78.21 acres of federal public lands within the exterior boundaries of the Parks
Reserve Forces Training Area, Camps Parks Military Reservations, city of
Dublin, Alameda County.
INTRODUCTION TO SB 50:
In October 2017, the Governor of California signed SB 50 (Allen, Chapter 535,
Statutes of 2017) into law, which added sections 6223 and 27338 to the
Government Code and section 8560 to the Public Resources Code. Section 8560
makes certain federal land conveyances void unless the Commission is provided
with a right of first refusal or the right to arrange for the transfer of the land to
another entity. The Commission must exercise its right of first refusal at a public
meeting. If the Commission was provided with its right of first refusal and right to
transfer to another entity but elects not to purchase or arrange for transfer, it
must issue a certificate affirming compliance with the law. Section 6223 prohibits
the recordation of a conveyance of federal public lands unless it is accompanied
by a certificate of compliance. The right of first refusal does not apply to certain
conveyances, including but not limited to, those associated with a habitat
conservation plan, lands conveyed into or out of trust for a federally recognized
Native American tribe, and certain land exchanges.
BACKGROUND:
The property proposed for conveyance includes 78.21 acres (Subject Federal
Parcel) that is part of a larger, approximately 180-acre area. The 180-acre
property is comprised of two parcels: one approximately 172-acre parcel that is
part of the 2,485 acre U.S. Army Reserve’s Camp Parks Reserve Forces
Training Area and an adjacent approximately 8.5-acre parcel owned by the
National Aeronautics and Space Administration (NASA).

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STAFF REPORT C86 (CONT’D)
In 2002, the U.S. Army requested an amendment to the City of Dublin’s General
Plan to change the land use designation covering the 180-acre property from
public lands to a mix of commercial retail, office space, residential, and open
space uses. In April 2003, the Dublin City Council authorized the commencement
of a General Plan Amendment study to consider this change in land use
designation covering the 180-acre area.
The transaction involving the Subject Federal Parcel, which was initiated in 2007,
is an exchange with the U.S. Army Reserves and U.S. Army Corps of Engineers
(USACE) conveying fee title to 180 acres in the city of Dublin to SunCal,
predecessor-in-interest of Dublin Crossing, LLC, for private development. The
development, known as the Dublin Crossing or Boulevard Project, includes
residential units, commercial uses, parks, open space, and an elementary
school.
In March 2008, the U.S. Army Reserves and USACE issued a Notice of
Availability for a Request for Proposals for a Real Property Exchange, by which,
in exchange for providing the U.S. Army Reserves with specific requested
facilities, a developer would be granted the right to acquire the 180-acre property.
In March 2011, the Army entered into an Exchange Agreement with Dublin
Crossing, LLC, to implement the Real Property Exchange. Since then,
conveyances have been occurring in phases and several have already been
completed. The Exchange Agreement calls for six distinct construction projects,
called the MilCon Projects, in exchange for six subparcels of the 172-acre Army
Reserve property. All six of the projects have commenced construction. Two are
complete, and another two are expected to be complete in the coming weeks. All
construction is scheduled to finish in 2018. Dublin Crossing, LLC, has already
acquired, by quitclaim deeds, the NASA-owned parcel and several portions of the
overall property. The Subject Federal Parcel has not yet been conveyed, and is
depicted in Exhibit B as occurring in Phases 3A, 3B, 4C, 4D, 5A, and 5B. The
area is to be developed in accordance with the Dublin Crossing Specific Plan
approved by the Dublin City Council in 2013.
Dublin Crossing, LLC, now seeks to acquire the remaining Subject Federal
Parcel from the USACE and has requested that the Commission issue a
certificate of compliance. According to the Applicant, Dublin Crossing, LLC, is a
joint venture of the California State Teachers’ Retirement System, Brookfield
Residential, and CalAtlantic Homes.

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STAFF REPORT C86 (CONT’D)
PROPERTY DESCRIPTION:
Appraised Value:
The Applicant submitted a land valuation of $296,180,069 for the Subject Federal
Parcel consisting of 78.21 acres (an average of $3,787,072 per acre).
Existing Improvements:
Improvements on the Subject Federal Parcel include roads, parking lots, and
approximately 10 small buildings used for equipment storage, vehicle repair,
office space, and administrative services.
Natural and Cultural Resources:
Staff has reviewed the Environmental Impact Report (EIR) (State Clearinghouse
No. 2012062009) for the Specific Plan prepared by the City of Dublin in 2013.
Because Camp Parks was developed by the U.S. Army Reserve in the 1940s
and the area was used for cattle grazing before then, natural resources are
limited in the area. The Specific Plan is set in the middle of the city of Dublin with
significant urban development bordering the south, east, and west sides of the
area. The Specific Plan area with the federal conveyance parcels is
approximately 180 acres. Over half the acreage (about 58 percent) is comprised
of non-native grassland. Another 41 percent is developed or semi-developed
(e.g., buildings, parking areas, storage areas, and roads,), and 1 percent is
comprised of emergent/seasonal wetlands and other waters, such as
drainages/canals).
In 2017, the USACE issued a section 404 permit for filling and mitigating the
wetlands as part of the Specific Plan build-out. The San Francisco Bay Regional
Water Quality Control Board issued a section 401 Water Quality Certification,
and the California Department of Fish and Wildlife (CDFW) issued a 1602
Streambed Alteration Agreement for the project. Impacts to special status
species are mostly limited to burrowing owl (a state species of special concern)
and Condgon’s tarplant (a California Native Plant Society list 1B species) that are
known to be present in the Specific Plan area. Mitigation for burrowing owl and
Condgon’s tarplant impacts is being coordinated with CDFW, and the impacts
were determined to be less than significant.
Based on the EIR, the Specific Plan area does not have any significant cultural
resources. The U.S. Army and the City of Dublin conducted many record and
literature searches and surveys over the years, and no significant cultural
resources are known to exist in the Specific Plan area. Mitigation has been
incorporated into the project for any potential impacts to unanticipated
archaeological or cultural artifacts discovered during ground disturbing activities.
In 2013, the City of Dublin invited California Native American tribes to request
formal consultation on the Specific Plan pursuant to SB 18. Following a 90-day

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STAFF REPORT C86 (CONT’D)
review period, the City of Dublin did not receive any request for consultation from
tribes.
Encumbrances:
The Subject Federal Parcel is subject to several encumbrances. A “Lease in
Furtherance of Conveyance” was executed on January 22, 2015, with respect to
the entire 180-acre overall property, authorizing Dublin Crossing, LLC, to begin
development of the proposed project as described in the Exchange Agreement
for a term of 15 years.
There is also an existing underground hydromodification storage vault with a 60inch storm drain that discharges to Chabot Channel. It is located in the portion of
the Subject Federal Parcel designated Phase 3A. This hydromodification storage
vault is owned by the City and maintained by the HOA. An existing 18” water line
also crosses the Phase 3A part of the parcel. The Dublin San Ramon Services
District currently owns and operates two existing 12” sanitary sewer lines.
The Subject Federal Parcel is also encumbered by conservation easements
entered into pursuant to agency permits with CDFW and the California Regional
Water Quality Control Board. The easements run along Chabot Creek.
Part of the southwestern portion of the parcel is subject to land use controls
imposed pursuant to the Army’s Record of Decision for the final cleanup remedy
for the site. Due to the presence of lead and dioxin contamination that will persist
at levels that do not allow unrestricted land use, the land use controls prohibit
use of the site for residential use, unless the site is further evaluated and other
appropriate remedies are implemented.
Contamination:
Various locations throughout the Subject Federal Parcel are contaminated with
hazardous or toxic substances, especially lead and dioxins. Despite remediation
efforts, some of the property remains contaminated and is subject to land use
controls.
APPLICANT’S INTENDED USE:
The Applicant intends to develop the property as a mixed-use development with
residential units, commercial uses, retail, public parks, and a K-8 school.
STAFF ANALYSIS AND RECOMMENDATION:
Authority:
Public Resources Code sections 6005 and 8560 and Government Code
section 6223.

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STAFF REPORT C86 (CONT’D)
State’s Best Interests Analysis:
Section 8560 defines “federal public land” to mean “any land owned by the
United States, including the surface estate, the subsurface estate, or any
improvements on those estates.” Although this definition is broad, the
legislative history suggests that the Legislature intended for SB 50 to
apply to federal public lands that provide environmental conservation or
preservation, economic support from tourism, scientific study, or
recreation. (See Assem. Com. on Natural Resources, report on SB 50
(2017-2018 Reg. Sess.), as amended May 26, 2017, pp. 3-4.; Sen. Com.
on Natural Resources and Water, report on SB 50 (2017-2018 Reg.
Sess.), Feb. 22, 2017 version, pp. 1-2.; Sen. Jud. Comm., report on SB 50
(2017-2018 Reg. Sess.), as amended March 20, 2017, pp. 3-4.) The
Legislature was aware that President Trump ordered the Department of
the Interior to review two dozen national monuments, six of which are in
California. These references in the legislative history suggest that the
Legislature sought to discourage conveyances of federal public lands that
possess high value for environmental and natural resource conservation
or preservation, tourism, scientific study, and recreation.
The Subject Federal Parcel proposed for conveyance to Dublin Crossing,
LLC, does not possess high value for environmental or natural resource
conservation or preservation, tourism, scientific study, or recreation. Most
of the property area and surrounding lands have been developed. Staff
believes, based on the past use as an Army Reserve training facility, the
urban setting bordering the Specific Plan area in the city of Dublin, and the
above information, that there are no natural or cultural resources with
significant values within the Subject Federal Parcel. Because much of the
Subject Federal Parcel has been developed, it does not provide valuable
opportunities for tourism, scientific study, or recreation.
Additionally, the Applicant’s intent to develop the Subject Federal Parcel
according to the Specific Plan would provide substantial benefits to the
surrounding communities, including a school, public parks, housing, and
commercial uses in an area already disturbed by development.
The Applicant submitted information that it has spent over $315 million on
its development project to date, and that it has pre-existing contractual
rights to the property as well as performance obligations under the
contracts.
For all the above reasons, staff recommends that the Commission find it is
not in the State’s best interests to acquire the Subject Federal Parcel or to
arrange for its transfer to another entity.

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STAFF REPORT C86 (CONT’D)

OTHER PERTINENT INFORMATION:
1.
This action is consistent with Strategy 1.1 of the Commission’s Strategic
Plan to deliver the highest levels of public health and safety in the
protection, preservation, and responsible economic use of the lands and
resources under the Commission’s jurisdiction.
2.

The Commission’s finding that it is not in the State’s best interests to
acquire the Subject Federal Parcel, or to arrange for its transfer, or to
issue a certificate of compliance are not projects as defined by the
California Environmental Quality Act (CEQA) because they are
administrative actions that will not result in direct or indirect physical
changes in the environment.
Authority: Public Resources Code section 21065 and California Code of
Regulations, title 14, section 15378, subdivision (b)(5).

3.

Finding that the acquisition or transfer to another entity is not in the
State’s best interests: Staff recommends that the Commission also find
that this activity is exempt from the requirements of CEQA as a statutorily
exempt project. The activity is exempt because CEQA does not apply to
projects that a public agency rejects or disapproves.
Authority: Public Resources Code section 21080, subdivision (b)(5) and
California Code of Regulations, title 14, section 15270, subdivision (a).

4.

Issuance of a certificate of compliance: Staff recommends that the
Commission also find that this activity is exempt from the requirements of
CEQA as a statutorily exempt project. The activity is exempt because
CEQA does not apply to ministerial projects. After being provided with the
right of first refusal or right to transfer to another entity, the Commission
has no discretion whether to issue the certificate of compliance—it “shall
issue a certificate of compliance.”
Authority: Public Resources Code sections 21080, subdivision (b)(1) and
California Code of Regulations, title 14, section 15268, subdivision (a).

EXHIBITS:
A.
B.
C.

Legal Descriptions
Plat to Accompany Legal Descriptions
Site and Location Map

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STAFF REPORT C86 (CONT’D)
RECOMMENDED ACTION:
It is recommended that the Commission:
CEQA FINDING:
1. Finding that the acquisition or transfer to another entity is not in
the State’s best interests: Find that the activity is exempt from the
requirements of CEQA pursuant to California Code of Regulations, title
14, section 15061 as a statutorily exempt project pursuant to Public
Resources Code section 21080, subdivision (b)(5) and California Code
of Regulations, title 14, section 15270, subdivision (a), projects that a
public agency rejects or disapproves.
2. Issuance of a certificate of compliance: Find that the activity is
exempt from the requirements of CEQA pursuant to California Code of
Regulations, title 14, section 15061 as a statutorily exempt project
pursuant to Public Resources Code section 21080, subdivision (b)(1)
and California Code of Regulations, title 14, section 15268, subdivision
(a), ministerial projects.
STATE’S BEST INTERESTS FINDING:
Find that it is not in the best interests of the State for the Commission to
acquire 78.21 acres of land proposed for conveyance from the U.S. Army
Corps of Engineers to Dublin Crossing, LLC, or to arrange for its transfer
to another entity.
AUTHORIZATION:
Authorize the Executive Officer, or her designee, to issue a certificate of
compliance with Public Resources Code section 8560 for the conveyance
of 78.21 acres of land from the U.S. Army Corps of Engineers to Dublin
Crossing, LLC.

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DOUGHERTY RD.

NO SCALE

DUBLIN BLVD.

DUBLIN, ALAMEDA COUNTY
NO SCALE

SB 50
DUBLIN CROSSING, LLC
SB 50 TRANSFER
ALAMEDA COUNTY
HW
Y

SITE

0

68

HWY 580
MAP SOURCE: USGS QUAD

This Exhibit is solely for purposes of generally defining the lease premises, is
based on unverified information provided by the Lessee or other parties and is
not intended to be, nor shall it be construed as, a waiver or limitation of any State
interest in the subject or any other property.

SITE

DJF 02/15/2018