Sale of habitat easement will help pay for Daniels Street to access Great Wolf

Manteca is working on a plan that will partially fund the $8 million extension of Daniels Street to access the 500-room Great Wolf indoor water park resort, establish a habitat conservation easement, and keep bringing $100,000 a year in farmland lease revenue to help offset costs associated with the city’s wastewater treatment operations.

The endeavor involves establishing the first habitat conservation easement in San Joaquin County on 417 acres the city bought in 2010 at 2300 Hays Road.

Manteca’s Economic Specialist Don Smail noted the proposal is a “win-win all the way around.”
Smail is handling the city’s negotiations with the San Joaquin Council of Governments to sell a habitat conservation easement for the 417 acres that also includes riparian land on the San Joaquin River side of the levee. The price would not exceed $5,000 an acre or $2,085,000.

The selling of the easement would restrict the use of the land in perpetuity for farming that also serves as habitat for birds and other animals. The funds to purchase such as easement come from developers required to pay fees to preserve habitat and/or farmland elsewhere when they go to convert existing agricultural and habitat lands to houses, commercial, or industrial uses.

The city would retain ownership.

Currently fees paid for habitat conservation in San Joaquin County now go out of county to expand habitat easements elsewhere such as along the Cosumnes River in Southern Sacramento County.

Smail noted that farmers in the general area of the Hays Road have sold easement rights for their property to secure continued use of it for agriculture and/or habitat conservation.

The game plan is to use the projected $2,085,000 in proceeds from the sale of the easement to help cover the $8 million tab for extending Daniels Street and installing infrastructure such as sewer and water lines beneath it to serve the Great Wolf resort as well as the envisioned family entertainment zone being pursued on city-owned land.

Smail is also working on a federal Economic Development Administration infrastructure grant to assist with the road project. Manteca qualifies to apply due to the loss of jobs countywide in various sectors.

Great Wolf will provide a combination of 500 permanent full-time and part-time when it is targeted to open in early 2020.

The city, as a fallback position, can tap into remaining proceeds from the sale of the final Redevelopment Agency bonds. By using other funding sources, it allows the RDA funds to be used for other projects that were listed as benefactors of the bonds when they were sold to investors.

Manteca bought the land near the San Joaquin River over a mile from the T-intersection of Airport Way and West Ripon Road in 2010 using fees collected on sewer connections. The city purchased it for $3.4 million or $7,529 an acre.

It was purchased for possible use as future spray fields for land disposal of treated wastewater from Manteca’s wastewater treatment plant.

Given the city purchased the property for $3.4 million and receive $2,085,000 for the easement if the sale goes through, it would appear Manteca is losing almost $1.3 million on the deal.
But that doesn’t factor in the $100,000 plus the city receives annually by leasing the 417 acres to farmers. They will be able to continue to farm the land via leasing the acreage out with the easement placed on it.

So far $800,000 plus has gone back into the wastewater account. Ultimately the city’s wastewater enterprise fund will recoup the $3.4 million and then continue bringing in $100,000 plus a year in today’s dollars going forward to help offset future wastewater related costs for ratepayers.

It also doesn’t factor in what the original purchase of the 417 acres did to the value of more than 100 acres attached to the wastewater treatment plant that originally was bought for $1,000 an acre. Because of the Hays Road deal the city was able to significantly enhance the value of the land they own that has high exposure along the 120 Bypass and ultimately will be accessed by two interchanges once the project at McKinley Avenue and the freeway is completed.