Stead Financial v. Cal. Statewide Communities Devopment CA1/5

BACKGROUND

On September 10, 2010, the City entered into a development agreement with Tracy Gateway LLC (Tracy Gateway). Under the terms of the development agreement, Tracy Gateway was “to develop parcels of land collectively known as the Tracy Gateway Business Park” (Business Park).

1 All further statutory references are to the Government Code unless

otherwise indicated.

2 Approximately two-and-a-half weeks later, Tracy Gateway entered into a Cost Sharing Agreement with SNB, the owner of certain parcels of land to be used for the Business Park, “to divide the costs of the [Business Park] development.” Under the terms of the Cost Sharing Agreement, Tracy Gateway and SNB agreed that “all fees and costs incurred relating to the” Business Park development “shall be borne by the parties in accordance with their Proportionate Share.” Tracy “Gateway’s Proportionate Share [] equal[ed] 58 [percent] and [SNB’s] Proportionate Share [] equal[ed] 42 [percent].” Reimbursement of the fees and costs incurred by Tracy Gateway and SNB would “occur as part of the [] bond financing” for the development. “To the extent such reimbursement does not occur from the [] bond financing, the party…