HERCULES -- The city will receive a one-time cash infusion of more than a quarter-million dollars thanks to a settlement of a long-festering dispute over development fees and which account they should go to.
The city and the developer of the Sycamore Hills by the Bay senior housing community, Semik Oungoulian, had settled the dispute, over the amount of Development Impact Fees he owed, for $550,000 back in 2006. An amendment allowed Oungoulian to pay $250,000 cash, with the $300,000 balance in the form of a loan secured by a deed of trust on his project, according to City Attorney Patrick Tang; the Hercules project was later replaced as the loan collateral by two Oungoulian properties in Marin County.
In 2009, for reasons unknown, the loan started to be booked, apparently erroneously, as payable to the now-defunct Hercules Redevelopment Agency; there is no record of the City Council ever approving a transfer of the loan from one agency as beneficiary to another, according to Tang's report.
On Tuesday, the council agreed unanimously to accept $270,000, or $30,000 less than Oungoulian owed, to put an end to the matter.
In light of the city's currently strapped finances, the lump sum payment of $270,000 is preferable to getting back the entire $300,000 over time, according to Tang's report.
Sycamore Hills By The Bay is a five-story structure towering over, and immediately adjacent to, Interstate 80.