REPORT TO COUNCIL
SUBJECT
Title
Approve a Median Improvements Cost Sharing Reimbursement Agreement with The New Home Company Northern California, LLC for Construction of Sunnyvale Saratoga Road Median Improvements at 777 Sunnyvale Saratoga Road and Approve Budget Modification No. 2 to Appropriate $222,300 to a new Project, Median Improvements at Sunnyvale Saratoga Road
Report
BACKGROUND
On April 28, 2025, the Planning Commission approved a Special Development Permit (PLNG-2023-0807) to allow the redevelopment of a commercial site at 777 Sunnyvale Saratoga Avenue into a 242-unit multi-family development (80 townhomes and 162 apartment units). Subsequently, on June 17, 2025, the City Council approved a BMR Alternative Compliance Plan with modified Conditions of Approval.
During planning review, a median was recommended for installation on Sunnyvale Saratoga Road pursuant to the City’s Roadway Safety Plan (Attachment 1 - Median Exhibit). Moreover, the development project would be responsible for its fair share contribution to that median project. The City does not currently have a capital improvement project for this improvement. Since it would benefit the City to accelerate the implementation of this median improvement and to more immediately increase roadway safety along this corridor, the City has requested, and The New Home Company Northern California LLC (“Developer”) has agreed, to design and construct the median improvements.
Under the Conditions of Approval (“COA”) EP-25 (Attachment 2 - COA Excerpt), the Developer shall design and construct the public median on Sunnyvale Saratoga Road between El Camino Real and Mathilda Avenue. The median installation will include demolition of street pavement, as well as installation of new curb, gutter, landscaping, irrigation, street trees, pavement, and striping. The Developer would be reimbursed for the costs beyond their fair share contribution. As determined and calculated in the Local Transportation Analysis, the Developer’s fair share contribution is 22% of the total cost of the median design and construction.
EXISTING POLICY
Pursuant to Sunnyvale Charter Section 1305, at any meeting after the adoption of the budget, the City Council may amend or supplement the budget by motion adopted by affirmative votes of at least four members so as to authorize the transfer of unused balances appropriated for one purpose to another, or to appropriate available revenue not included in the budget.
ENVIRONMENTAL REVIEW
As presented to the Planning Commission during the April 28, 2025, approval, the project's environmental impacts are addressed in the El Camino Real Specific Plan Environmental Impact Report. No additional environmental review was required for the overall project, which included the median installation, pursuant to CEQA Guidelines Section 15183.
DISCUSSION
Staff and the Developer worked together during project development to define the median improvements on Sunnyvale Saratoga Road. Detailed improvement plans for the median were provided to the City for approval in accordance with the Conditions of Approval for the development project and will include landscaping that will be well vegetated with a diverse foliage of trees, low-growing shrubs and groundcover. The project cost is estimated at $265,000 for construction (with 15% contingency) and $20,000 for design. The total cost is $285,000.
The Developer’s fair share contribution is $62,700. Therefore, a reimbursement agreement (Attachment 3) and budget modification are required so the City can pay the costs that exceed the Developer’s contribution in the amount of $222,300.
FISCAL IMPACT
Budget Modification No. 2 has been prepared to appropriate $222,300 of Capital Improvement Projects Reserve funding from the General Fund to a new project - Median Improvements at Sunnyvale Saratoga Road to reimburse the City’s portion of the project.
Budget Modification No. 2
FY 2026/27
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Current |
Increase/ (Decrease) |
Revised |
|
General Fund |
|
|
|
|
Expenditures |
|
|
|
|
New Project - Median Improvements at Sunnyvale Saratoga Road |
$0 |
$222,300 |
$222,300 |
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|
|
|
|
|
Reserves |
|
|
|
|
Capital Improvement Projects |
$6,002,073 |
($222,300) |
$5,799,773 |
PUBLIC CONTACT
Public contact was made by posting the Council meeting agenda on the City's official-notice bulletin board at City Hall, at the Sunnyvale Public Library and in the Department of Public Safety Lobby. In addition, the agenda and this report are available at the City Hall reception desk located on the first floor of City Hall at 456 W. Olive Avenue (during normal business hours), and on the City's website.
RECOMMENDATION
Recommendation
Approve a Cost Reimbursement Agreement, in substantially the same form as Attachment 3 to the report, with Developer for the construction of Median Improvements at Sunnyvale Saratoga Road and authorize the City Manager to execute the Agreement, and approve Budget Modification No. 2 in an amount of $222,300.
Staff
Prepared by: Mitchell Lee, Senior Engineer
Reviewed by: Ramana Chinnakotla, Interim Director, Public Works
Reviewed by: Matt Paulin, Director, Finance
Reviewed by: Sarah Johnson-Rios, Assistant City Manager
Approved by: Tim Kirby, City Manager
ATTACHMENTS
1. Median Exhibit
2. Excerpt from Condition of Approval EP-25
3. Draft Reimbursement Agreement