A hotel proposal that has generated positive community reaction seems headed for disagreement as the developer faces off with the Rancho Murieta Community Services District over water availability. The CSD maintains water will become available for the 83-room hotel as part of a financing agreement for a $6 million expansion and rebuild of the existing water treatment plant. The developer claims the Murieta Gardens development is already entitled to water and sewer service, with the existing plant able to meet the project's needs.
Murieta Gardens I and II is being developed by Cosumnes River Land LLC, which is owned and managed by longtime residents John Sullivan and Carol Anderson Ward. Last week, Sullivan and the Pension Trust Fund for Operating Engineers announced plans to develop the remaining land in Rancho Murieta North -- a project separate from Murieta Gardens.
Sullivan appeared at the CSD Improvements Committee meeting in early January and read a letter stating Cosumnes River Land's position on Murieta Gardens after handing out binders two inches thick with documents.
"At this point, we do not believe that we should be part of prospective financing and services agreement because we've already paid for the water rights we have," Sullivan read. "We believe there are sufficient water entitlements to allow the development of the property, and in particular, there are sufficient capacity in the plant to allow currently to allow us to proceed with development of our property without getting involved with the (financing and services agreement)."
John Sullivan's presentation on the proposed hotel filled the RMA Building for a meeting in December.
Sullivan's letter claimed Murieta Gardens is entitled to water and sewer services because of its inclusion in Improvement District #1, formed in 1986 to pay for the CSD's acquisition of existing facilities -- the wastewater treatment plant, pump stations and others -- and for improvements.
The acquisition and services agreement and amendments to the agreement were among the documents in the binder.
Sullivan's letter also referred to exploratory wells the CSD wants to construct on property owned by Ward. "Although we are prepared to cooperate with the District on this issue, we find it odd and unneighborly for the District to refuse to make any written acknowledgement of the extent of our water entitlements for Murieta Gardens I & II, which is more or less adjacent to her existing property," the letter reads. "…We believe we could use existing well water from Mrs. Ward's property … to satisfy the water requirements for the hotel and associated retail development area. If we take that route, however, the District would most likely be without an augmented supply of water for drought protection in the future."
Following the committee meeting, CSD General Manager Ed Crouse commented that the CSD's position is the same for all new development: "There is no water service available for any site until and unless the water treatment plant is expanded."
The CSD has a long-standing philosophy that new development should pay to expand water services.
Crouse said conditions the county placed on the Murieta Gardens project and other projects in the next phase of development require the water treatment plant to be built and online.
Negotiations for the financing and services agreement haven't moved forward in part because the developers have issues related to reimbursement to work out, Crouse said.
If Murieta Gardens were to receive water service, the remaining members of the developer group would have a right to water service immediately without constructing a plant because "we can't do for one what we can't do for the others," Crouse said.
"If the CSD stands in the way of giving us our will-serves, we intend to go to court," Sullivan said in an interview the week after the committee meeting. "...They're not going to get well water when they're not going to serve the properties. If they choose not to serve the properties, they're going to get a lawsuit."
The Sacramento County Board of Supervisors approved the Murieta Gardens project in 2011. Sullivan and Ward acquired the property in May 2012 and changed the plan to include a hotel and extended stay units. The amended plan is going through the county planning process.
A four-story, 83-room hotel is among the proposals for Murieta Gardens, across from Murieta Plaza.
At a town hall meeting in December, audience comments about the hotel project were generally positive (by the end of the meeting, Sullivan was being asked what kind of fare the hotel restaurant would serve and how much a room would cost), but some expressed concern about the project's effect on water supplies and residents' costs.
Based on input from the town hall meeting, the Rancho Murieta Association board provided a comment letter to county planning that included the stipulation that the project shouldn't be allowed to impact water availability for existing residents.
Sullivan and Ward appeared at the January CSD meeting. Sullivan had an updated version of his letter and asked the board to "continue deliberations on our request to get will-serves for Cosumnes River Land."
Sullivan presented a spreadsheet of water usage during peak months, noting that production capacity of 3.1 million gallons occurred at the water treatment during a "very hot" period in July 2006 and usage has declined since then.
"Our project expects to use no more than 100,000 gallons per day, which would be about 3 million gallons a month, so it would only be a small portion of the unused and unallocated capacity," Sullivan said.
Ward told the board, "We're doing the best we can to what we think add improvement to the community. I love it here. I've lived here pretty much all my life since '78, sometimes on the other side of the road, sometimes behind the gate. We are trying to do a great project here. ... We felt we had the water and services, and we're proceeding to try to improve the quality of life out here, especially for my exhibitors that come to the horse shows that I think support a lot of our community services as it is. I guess I'm just asking for your help and guidance and we can move forward. Thank you."