Petaluma and one of the city's largest developers have agreed to a settlement in which the company will pay traffic impact fees that were in effect in 2003 rather than higher fees required now.
The City Council approved the settlement last month during closed session, but announced it Monday night. City Attorney Eric Danly said the agreement wasn't fully executed until after the vote, so it was made public at the next council meeting.
The council voted 6-1, with Teresa Barrett opposed, to approve the settlement with G&W Ventures, managed by Basin Street Properties President Matt White. Basin Street owns several properties in Petaluma, including the Theatre District downtown and several buildings near Old Redwood Highway and North McDowell Boulevard.
The agreement calls for developers to pay a total of $817,000 toward highway improvements near the Redwood Business Center for five buildings it received city approval to build in 2003. Fees have been paid for the first two buildings, which are occupied by Club One gym and the networking technology company Cyan.
A dispute cropped up when the developers sought building permits to begin work on the third structure, at 1385 N. McDowell. Two other parcels haven't been developed.
Paul Andronico, attorney for Basin Street, said it was understood that the 2003 approval set traffic impact fees at the level in effect then, not when the buildings were actually constructed.
In ensuing years, the city increased traffic impact fees, which would have amounted to about another $1 million from Basin Street to the city, he said.
There was no formal development agreement that stated that, though, and none of the city planners around in 2003 are still with the city, Andronico said.
"It was past practice, but they wanted more than that," he said. "We ended up in a situation where they wanted to charge all of the new fees, but we didn't agree to that."
Ultimately, he said, the company and city agreed to use the 2003-level traffic impact fees for all five buildings, a total of $817,000.