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a 10 percent construction contingency, staff is not recommending a budget adjustment to CIP No. 18531 at this time. CIP No. 21596 JDEDZ ROW and Misc. with a budget of$1.8 million was created in 2020 to fund the purchase of the right-of-way needed for the JDEDZ Street Improvements. In September 2021 City Council approved a purchase agreement in the amount of$1,027,239 for the land needed from DSRSD, leaving a balance of$772,761 available in CIP No. 21596. The six purchase agreements recommended for approval with this agenda report total $1,321,317, including title insurance and escrow fees. However, the purchase agreement with TP Heritage Inn LLC, the company constructing two hotels on Johnson Drive, states the $594,788 payment for the right-of-way needed along its property frontage will be in the form of a fee credit applied to its city permit fees. With the fee credit payment to TP Heritage Inn, the balance needed for payment on the other five purchase agreements is $726,529 which is available in CIP No. 21596. It is recommended that City Council approve the six purchase agreements and authorize the City Manager to execute the agreements. Assuming City Council approves the six purchase agreements, the balance remaining in CIP No. 21596 will be $46,233. As stated previously, staff will continue efforts to acquire the right-of-way needed from the two remaining properties on Johnson Drive to complete the sidewalk and landscaped parkway. The Final Cost Estimate of$2,581,788 to acquire all the right-of- way needed for the JDEDZ Street Improvements includes an estimated cost of $230,000 for these two properties. If staff is successful in negotiating purchase agreements with these property owners for the estimated total cost of$230,000, the shortfall in CIP No. 21596 will be $183,767. However, no budget adjustment is recommended at this time. If staff is successful in finalizing one or both purchase agreements, the agreement(s) will be presented to City Council for approval at a future City Council meeting along with a recommended fund allocation to CIP No. 21596 necessary to complete the transactions. Expected Loan and Payback Period As shown in the table on page 8 of this report, based on the Final Cost Estimate the total loan from Costco to the City to complete the traffic mitigation measures for the JDEDZ Project is $11,408,797. The 2018 Agreement requires the City to repay this loan using the JDEDZ Transportation Fee which will be collected from "non-Costco" properties in the JDEDZ Project area as each develops, and with 40 percent of the city sales tax revenue generated by the new Pleasanton Costco store. Since it is unknown when "non-Costco" properties will develop and pay the JDEDZ Transportation Fee, the following calculation is based only on the city sales tax revenue generated from the Pleasanton Costco. According to the City consultants, Management Partners and HdL Companies, the anticipated city sales tax revenue from the Pleasanton Costco store will be between $1.8 and $2.1 million in 2024. (Up from the $1 to $1.3 million estimated in 2018). Using 40 percent of the anticipated 2024 city sales tax revenue generated by Costco, or $0.72 to $0.84 million, the loan payback period will be approximately 14 to 16 Page 10 of 12