HomeMy WebLinkAbout1981-08-25; City Council; 6721; Incentive housing program.
August 25, 1981
--l_-.+ll___ - -- -__I
DATE :
J
DEPXRTMEMT: Housing and -- Redevelopment - .--- e, Mqr,
--- .- Subject: CHAMBER OF COMMERCE HOUSING COMMITTEE'S PRCPOSED PROGRAM" "INCENTIVE HOUSING
Statement oE the blatter
The Chamber of Commerce Housing Committee has recornended an incentive housing program which could be used to provide affordable housing units without direct public subsidy. The proposal addresses ownership opportunities for persons and families earning 80 to 150 percent of the County wide median income as published by the Department of Housing and Community Devefopment of the State of California.
The approach chosen by the Committee involves the use of expedited processing and flexible application of development standards as methods to reduce cost.
of each project would be spelled out in a development agreement negotiated between the developer and the City. The agreement would identify all concessions made in the area of development standards as well as the controls to be imposed by the City.
The specifics
Mr. Don Woodward, Chairman of the Chamber Housing Committee, will be in attendance to present the program to Council and will answer questions regarding the proposed approach.
Review of the proposed program, coupled with developmental services departmenJa1 input indicates that the proposal is a responsive and workable approach to providin2 below market rate ownership opportunity.
In light of the Housing Element's goals, Council should consider wording to ensure production, of units selling to persons earning less than 120% of the median income.
EXHIBITS
Report from Housing and Redevelopment Director dated August &(I, 1981.
FISCAL IMPACT
Expenditures will be limited to staff time required to process, unless fee waivers or other direct dollar forms of subsidy are used. "
COMMITTEE RECOMMENDAT I OM
The Housing and Redevelopment Advisory Committee reviewed the proposal at its meeting of April 13, 1981, and recornended that additional input be sought by the Council before final action is taken.
RECOMMENDATION
If the Council concurs with the proposal, staff should be directed to process enabling documents amending Title 21 (zoning) of the Municipal Code to provide for approval of below market rate housing proposals via development agreements with emphasis on that portion of the market below 120% of the median income.
COUNCIL ACTION:
8/25/81 Council app,roved Staff recommendat-,,.
MEMORANDUM
DATE :
TO:
FROM:
SUBJECT :
August 10, 1981
Frank Alehsire, City Manager
Jack E. Henthorn , Housing and Redevelopment Directo
IN CENT1 VE HOUSING PROGRAM
INTRODUCTION
The Carlsbad Chamber of Commerce formed a Housing Committee in late 1980. The Committee is charged with a number of tasks relating to the Chamber's
policy on housing (Exhibit 1 ).
Committee was to produce a program which would act as an incentive to the
private sector to produce housing units marketable to persons earning 80%
of the County wide median income.
The first major task undertaken by the
As a basis for this effort the Chamber Committee relied on statements contained in the Chamber Housing policy as well as the City's Housing
Element. In essence, this meant that the Chamber's efforts would be directed to encouraging housing development which would sell bel ow current market
prices.
The product of the Chamber Committee's efforts is an Incentive Housing Program which could be used to provide affordable housing units without direct public subsidy. (Exhibit 2 ) The proposal addresses ownership opportunities for
persons and families earning 80% to 150% of the County wide median income as published by the Department of Housing and Community Development of the State
of California. (Exhibit 3 )
The Chamber Committee in its deliberation concluded that it would not be feasible to offer ownership opportunities to income levels below 80% of the median without direct subsidy from the government. housing opportunities for this 'level should be explored as a separate subject. The Chamber felt that
CONCLUSION AND RECOMMENDATION
It is concluded that the proposal offers a responsive and workable approach to providing below market rate ownership opportunties.
If the Council concurs with the proposal, staff should be directed to process enabling documents amending Title 21 (zoning) of the Municipal Code to provide
for approval of low and moderate income housing proposals via development agreements.
3
' Frank Aleshire August 'page 2/Incentive Housing
Council should also provide direction as to whether or not it desires to concentrate the program on housing serving the 80-120% of median income market.
SUMMARY OF CHAMBER'S PROPOSAL
The approach chosen by the Chamber Committee involves the uses of expedited processing and flexible application of development standards as methods to reduce cost. development agreement negotiated between the developer and the City. The agreement would identify all concessions made in the area of development standards as well as the controls to be imposed on the development by the City.
Each proposal considered under the Chamber program would be analyzed in terms of building code, sales price, density, and development standards. This analysis would be an integral part of each development agreement package presented for Counci 1 consideration.
The specifics of each project would be spelled out in a
INCOME LEVEL
As proposed by the Chamber Committee the program would address the housing needs of individuals and families earning between 80% to 150% of County wide median income.
As can be seen by the attached chart of Maximum Shelter payment by family size the 150% category (Exhibit.4) begins to approach a level which can currently be served by the lower end of the unassisted housing resale market. and the State Housing and Community Development Department define low- moderate income as being those individuals earning up to 120% of the county
wide median. Consistency could be accomplished by restricting the number of units to be marketed to income levels above 120% of the median income.
The Department of Housing and Urban Development of federal government
This approach would also bring the proposed program in line with the goals as established in the recently adopted Housing Element. The Housing Element recognizes a primary need in the 120% of median income and below range but also identifies the need for programs to address housing needs between the median income and the current market.
MAJOR COST FACTORS
Densi ty/Development Standards
In viewing approaches similar to that proposed by the Chamber Committee, the most significant factors in cost reduction are density and financing costs. Project analysis indicates that a 100% increase in lower range multiple
.3
, Frank Aleshire
; ' August page 3/ Incentive Housing
densities (10-20/acre) wi 11 result in a savings of approximately 25-30% on the market price of units produced. Orange County increased density coupled with a covered parking waiver resulted in an average sales price reduction from $99,000 per unit to $66,000 per unit.
In an actual project undertaken in
The impact of other development standard modifications is unclear since the project involved no other significant waivers. of areas recommended for reduction or waiver do not individually contribute as significantly as density to overall savings. by the example contained in the Chamber's proposal where non density related items amount to only $2,50O/per unit. However, more significant savings may be possible when waivers are viewed on a more extensive basis. consider modifications or waivers of development standards should be retained since each project will vary in ability to accommodate increased density.
Mr. Don Woodward, Chairman of the Chamber Housing Committee, has developed figures reflecting cost savings associated with a hypothetical development.
(Exhibit 2) The development, 130 units on 6+ acres, would be targeted to sell in the $55,000 to $60,000 price range. minor application of the waiver/modification of development standards and density would reduce the cost to the consumer by $5,000. in the $56,000 to $77,000 price range for two and three bedroom units.
A1 though the monthly payments ($636-$852) exceed the lower income targets , they are within the "affordable" category as defined in the Housing Element.
With relatively minor adjustment, a portion of the units could be made available at prices where our housing element fair share allocation would be credited.
It appears that the remainder
This appears to borne out
The ability to
In the example, a relatively
This would place the units
Interest Rates
Interest rates on long term financing are probably the biggest key to affordable housing outside of density. The ability to generate below market rate interest financing is very important in encouraging low-moderate income ownership opportunities.
In the Chamber Committee's example the assumption is made that the rate of interest is 15% over a 30 year term after a 10% downpayment. would result in a monthly mortgage payment of $705 on a $55,800 principal. Initially the buyer would need an income of $1,650 per month to qualify. However, through a method known as a "buydown" the lender lowers the interest rate for 3 years. The interest rate initially would be 12%, graduating by one percent per year until the 15% range is reached at year four of the mortgage. This example assumes that the individual's ability to pay will increase over time.
Normally this
Another option is available to reduce interest rate. bonds secured by the mortgage payments generated from the sale of housing The City could issue
Frank Aleshire ‘August page 4/ Incentive Housing
units. revenue bond financing level) the monthly payments on the same loan used in the example over the same term would be $500 or a net savings of $205 per month to the buyer. with a gross income of approximately $1,450 per month. one significant area where the City could assist in the provision of low- moderate ownership opportunities would be making available its ability to generate financing for long term mortgages through the SB 99 Mortgage Revenue Bond provision of State law. However, this technique should only be made available when other methods of rendering costs have been exhausted. (See
comparative interest rate table Exhibit 5 )
If the interest rate were reduced to 10 1/4% (the current mortgage
At the 10 1/4% level the same family should qualify It appears as though
PROCESSING OF PROPOSALS
Exi s t i ng
The existing City review of development projects adequately addresses standards and design criteria estabilished in projects. The Building Department currently has expedited processing for affordable housing. In the Redevelopment Area, the Redevelopment Plan and the Design Manual are capable of addressing the bulk of the items noted in the proposal. Planning Department and City Attorney’s office are currently working on a development agreement approach which would incorporate some of the concerns addressed in the program. However, the established review process does not evaluate the impact of standards and design criteria product cost. estate economics must become an integral part of the review process if low and moderate housing opportunities are to be made available at the income levels noted in the recently adopted Housing Element.
The
Real
Pro uos ed
The plan review process as proposed by the Chamber will require detailed analysis of the dollar benefits to be derived from proposed standard modifications or waiver. This would require the developer to submit detailed cost information in addition to that required for a standard development.
Under the proposed process the developer and the City would enter a 60 day negotiating process to consider whether to modify or waive certain provisions relating to public facilities requirements and land use regulation. Therefore, the staff and the developer must work from common figures. in order to determine the actual reduction in cost resulting from any requested modifications or waivers. The proposal envisions that the developer would prepare project analysis sheets based on current costs for review by the staff. The sheets would include prelimiary costs which would indicate, on a gross basis, costs anticipated by the developer to be incurred on a standard project as well as in his proposal.
This is required
In addition, each applicant would be required to
Y
Frank A1 es hi re
page 5/Incentive Housing . August
submit a cost sheet showing construction costs on a square foot basis for the major eomponents of the units. Based on these costs and the developers
timetable, a cash flow summary would be prepared in order to ascertain the
most cost effective processing time line in terms of savings to the consumer.
The final document which would be required, is a preliminary statement of
closing costs which would show how the developers program is capable of
addressing the income levels identified in his proposal. This package would
then become an integral part of the negotiations and site plan review.
The agreement resulting from this approach would set out the required performance for both parties. This would also identify the specifics of each project
relative to waiver or modification of standards, sales prices, and income qualifications. In addition, it is anticipated that some speculation control
would be included in the program. term, which could be waived in the event of hardship cases such as job transfer,
death, or other extenuating circumstances. This would probably cover a three
year period and be in the form of a lien similar to that shown in Exhibit 6 .
Controls could include a required residency
ACTIONS NECESSARY TO IMPLEMENT
In order to implement the development agreement appoach it will be n e sary tu amend the zone code (Title 21, Municipal Code) ln accordance with !&!%.e
Government Code Regulations. as Exhibit 7 . This document will not spell out the specific submittal requirements or procedures for processing.
Submittal requirements and processing procedures should be established by resolution. This will clarify for all parties what will be required in the review process. It will also afford flexibility to the Council in altering the process without code modification.
A draft ordinance accomplishing this is attached
JEH: a1
.- . . .
CHAMBER' OF COMMERCE
.. .. - -----
' POST OFFICE BOX 1605 * CARLSBAD,CALIFORNiPc 92008 9 61141 729-5924
HOUS IflG COMMITTEE
It is the policy of the Carlsbad Chamber of Commerce to maintain a
committee for the purpose of monitoring the housing needs of the community, ta
assist in efforts to provide for the various housing needs of the comtmity, to
meet the housing needs of the expected expansion in the paputation of CsrLsbad
and San Diego County from the current tine until the year 2000, housing far
people of all economic income levels will need to be net either through the
private sector or through public sector actions.
The Purpose of this Committee is to:
Carlsbad and the north county area.
construction of various types of housing.
governmental agencies for private or public housing projects.
people with all levels of income by conventional or imaginative methods,
The Benefits
1). Create forum for understanding between the private sectar and the
local, county, state and federal government for laws or regukations as they
apply to the development of housing which could heip meet expected hous5nq
needs.
2). Create cooperative and innovative actions by private and public sectar
for mitigating housing needs in Carlsbad and north county area.
1). Maintain data as to supply of housing stocks of various types wititin
2). Review governmental regulations as they appty to the deuelapment and
3)- Monitor avai lab; li ty of financing f rorn private lending agencies or
4). Recommend course/s of action to expedite development of housing far
P1 ann i ng :
1). This wilt be a year-round committee, ending with the expiration af the
term of the President on December 31.
2). The President shall appoint the Chairman of the Conmittee, The
Committee Chairman in consultation ui th the President and the Executive Vice
President shall appoint the committee members. The participants shoutd inctude
representatives from various sectors of private enterprises as uett as
governmental leaders, in such numbers as deemed necessary to accomplish the task
assigned . 3). The Committee shall make regular reports to the Board of Directors
covering the past and projected activities and will at the end of the caiendar
year, make reports and recommendations to the Board of Directors to evaluate the
Committee activities.
1). The Committee Chairman shall report directly to the First Vice
President on Commi ttcc act ions and reccamendations.
Draft: 10/14/80
CAnLCDAO CHAMBER OF COhlMERCk - OFFICEB. ELM AVEXUE AT OLD SANTA FE DEPOT :/ EXHIBIT. 1
PROPOSED
INCENTIVE HOUSING PROGRAM
The City of Carlsbad
submitted by
CHAMBER HOUSING COMMITTEE
Don E. Woodward ,Chairman
EXHIBIT 2
(Report prev. distri.)
.'
4
c-r cn 0
bp
-
Iu N
m 0 0
V
N cn
01 cn 0
"
-
N 03
a3 U m
V
-
w N
c.r 0 0
U
-
W P
I--' N cn
U
-
w tn
I-J m 0
V
-
w 03
I-J 0 0
"
-
P 0
r N m
Y
w N 0
bp
-
tr 03
0 0 0
U
-
N 0
UI rn 0
U
-
N w
w 0 0
U
I__
p\3 VI
-4 0 0
Y
-
Iv -4
w 0 0
U
-
N 03
W 0 0
V
I_.
w 0
m 0 0
Y
___.
w Iv
I-J 0 0
Y
t-l 0 0
M
-
r m
0 0 0
U
-
I-J
U
0 0 -
I-J CD
N 01 0
U
-
N r
P. 0 0
Y
-
N Iu
U cn 0
V
-
Iu P
0 0
V I-J
N m
P 0 0
U
-
.c
N Cn
U cn 0
"
r N
0 0 0
U
c1 w
U 0 0
U
I-' V'
Y
w 03
N 0 0
U
" N v1 0
Iv 0
w UI 0
U
lQ w
P 0 0
"
z! W
r -<
v)
N m
W
w
N
-
w
-
P
-
m
(n st
CY W m m 0
l-4 z
c) 0 3 m
I- m c=
l- (n
m
, EXHIBIT 3
G) -5 0
v) v)
c
0, 1% -0 -2 L<
t-r 0
I
H 3 0 0 s
m 3+ S
840 SO 03 om 3 m
G, -5 0 cn
v)
S 5
W 3 0 0 3 m
3 0 IS cf- I5 F
PO, m 0 -5 m 0, v) rn
PP PN mP
NN mm
-P mo 00
V Y
mm mw am
ww NO
rm 00 00
V V
IDco wco mID
I-JI-Jw co-m
NI-JP 000 000
V Y V
www vmIV am*
NNI-J NWID
WPN mom 000
V V V
mmp mwco amr
NNN WLnO
w-I-J 000 000
V V Y
u-m WPW maw
N 0
m m 0
V
7
m ID ID
-
f
-
c1 N
0 0 0
-0 HZ 40
n N v
-3 r;?
w
m 4
lo EXHIBIT 4
CI 0
N cn M
c1 ul M
J
‘5 U
)--L Cn M
W 0
‘5 WJ
#? U Cn 0
c1 C-r N
bp
R
F
v) I
I m
11
EXHIBIT 5
NHEN RECORPrA MAIL TO:
Builders Consortium for Affordable Housing 2201 E. 4th St., Suite 222 Santa Ana, CA 92705
INSTRUMENT AFFECTING AND IMPOSING A LIEN ON REAL PROPERTY
THIS INDENTURE made this day of LOS ALISOS VENTURE, a limited partnership (hereinafter referred to as "Sell er") and (the "Purchaser") is made with reference to the following facts:
, 1981, by and between
A. Concurrently the Purchaser is acquiring from Seller the following described real property in the unincorporated area of El Toro, County of Orange, State of California, more particularly described in Exhibit A attached hereto and made a part hereof.
Such real property including the improvements thereon shall hereinafter be referred to as the "Property".
to Purchaser, the Purchaser represented to the Seller that Purchaser intends to own and occupy the Property as Purchaser's principal place of residence .
upon the terms and conditions specified in Section 1.1 hereof.
Seller in connection with the sale to Purchaser. Seller would not have sold the Property to the Purchaser, but would have retained the benefits of ownership including future appreciation of the Property.
tation and inducement is untrue, Seller would have the right to rescind the sale and recover title and possession of the Property and the benefits of ownership including future appreciation of the Property. also acknowledge that if subsequent to the acquisition of title to the Property by Purchaser, Purchaser acts in a manner which may be inconsistent with such representation and inducement, Seller and Purchaser may disagree as to whether Purchaser's acts are so inconsistent and that such disagreement may be unresolvahle without the time and expense of litigation. In order to avoid such disagreement, Seller is willing to waive Seller's right to rescind the sale to Purchaser based on such representation and inducement in consideration of Purchaser's executing this Lien Instrument to become effective upon the close of escrow through which title to the Property is conveyed to Purchaser.
E. By executing this Lien Instrument, Purchaser agrees to pay to Seller an Additional Purchase Price pursuant to Part I1 hereof. allows the Purchaser alternative means by which to remove its effect.
B. In connection with such acquisition and to induce Seller to sell
C. Such representation by Purchaser was a material consideration to But for such representation
D. Seller and Purchaser acknowledge that in the event such represen-
Seller and Purchaser
This Lien Instrument
EXHIBIT 6
.-
NOW, THEREFORE, In consideration of the foregoing, ,~luding the sale of the Property by Seller to the Purchaser, Seller and the Purchaser agree as follows:
I. CONDITIONS FOR RELEASE OF LIEN:
. Seller agrees to release this lien and to execute in recordable form appropriate documents evidencing such release upon the occurrence of any of the following:
1.1 Ownership/Occupancy. The furnishing to Seller of evidence reasonably satisfactory to Seller that (i) Purchaser was the initial occupant of the Property after the date hereof; (ii) once such initial occupancy began, Purchaser occupied the Property as Purchaser's principal place of residence continuously for a period of one (1) year following the date hereof; and (iii) during the entire tern of Purchaser's occupancy of the Property, Purchaser was also the record owner of fee simple title to the Property; or
recordation hereof without Seller making demand for the payment of the Additional Purchase Price pursuant to Section 2.3 below; or
.
1.2 Passage of Time. Three years have passed since the date of
1.3 Payment of Additional Purchase Price. Purchaser has paid to Seller the Maximum Additional Purchase Price specified in Part I1 hereof; '
or
1.4 Special Circumstances. Upon the presentation to Seller of . . evidence reasonably satisfactory to Seller that special circumstances have. occurred which in the good faith judgment of Seller justify a release of this lien. Such special circumstances shall include, but not be limited to, the death of one or. more of the Purchasers, the relocation of Purchaser's place of occupation so as to create a significant hardship to Purchaser in traveling to and from the Property and such place of occupation, the loss of Purchaser's occupation and the failure of Purchaser to obtain a reasonable substitution occupation within a reasonable period of time and other special circumstances.
1.5 Principal Place of Residence. In evaluating evidence submitted to Seller by Purchaser for the ,purpose of showing that Purchaser was the initial occupant of the Property and occupied the Property as Purchaser's principal . place of residence for the continuous period required, Seller agrees to act .reasonably and in good faith. For the purpose of making such evaluation, Seller may require Purchaser to submit evidence including, without limitation, the . . following, all of which shall be submitted, if so required by Seller, with , an acknowledgment under penalty of perjury that such evidence is true .. and. accurate to the best of Purchaser's knowledge.
the time of Purchaser's occupancy of the Property being the same as the address of the Property:
.
..
(a) Purchaser's address for the following purposes during
.. ..
. (i) Voter registration; ..
.. .. .. (ii) Federal and state income tax notices; Automobil e registration; ..
Utility bills; 'yl .. (v) Property loan statements;
.. (vi) Installment account billing.
(b) Purchaser's minor children reside at. the Property unless
(c) 'Statements from nearby neighbors declaring that in the '
.. ..
legal custody therefor resides in someone other than Purchaser;
belief of such neighbors, Purchasers have occupied the Property as Purchaser's principal place of residence.
'
..
,. , ...
1-3
4' . /' ' < -2-
.. .. - -
11;. PAYMEiri OF ADDITIONAL PURCHASE: PRICE . _' , .. .. --
2.1 When Pa able. Unless this l'ien has been released pursuant" .' to Part I heref-emand, Buyer agrees to pay to Seller upon Seller's. .... :. ... demand following one (1) year from the date hereof an Additional Purchase ..;.,., -; :. . Price in the amount determined Dursuant to Section 2.2 below. but not,to :.:.I..:. . :I *." .. .... .exceed.the Maximum Addi,tional .P;rchase Price., .... ' ..... .. . .. ................. ........ ........ ... .. ....... .. .. . . _. .-. -. .. ._. .. ..- . --. -. .-c
.. ' 2.2 Dete'hination of Additional Purchase Pric .. Purchase Price shall be eaual to the fair market value of the ProDertv as I- ..':' . .-' :
improved as of a date whidh is one (1) year from the date of recoFdat:on hereof .. less the Purchaser's carrying and improvement .costs (as defined in Section :' ._
. Purchase Price shall never exceed Twenty-five Thousand Dollars, ($25,000) (the . . -'..
2.5 below) during such one (l),year period; provided, however, the Additional". ..
"Maximum Additional Purchase Price'!). . Such arket value shall be deter- ' .... ,. .. ..
.... ..... ......... .....
mined pursuant to Part V'hereof. .: . .1 '.
-. '. 2..'3 ' Time for Demand. Sel
.. .. payment of the Additional Purchase Price at any time after the expiration . . of one (1) year from the date of recordation hereof and prior to the expiration
of three (3) years from the date of recordati0n:hereof.
.. ,., -_ . -. .' .. -. . _.
.. ..
... .... . ... ... .. _- .
-. I .... .... ..... .. .-
...
..
... 1 . . ,- ._ . .. . _- . .. , .. .. .. ..
2.4 Release After Demand. Within ten (10) days following the date : .- of mailins to Purchaser of a demand for the Davment of the Additional Purchase . .
*..
.. ..
Price, Purchaser may, .in writing delivered tb Seller within said ten: (10) day period, request a release of this lien pursuant to Part I hereof. thereafter releases this lien, said demand shall be of no further force or . . ' effect. (10) day period, the Additional Purchase Price shall be due and payable.within
to Part V.
If Seller
If Purchaser fails to request a release of this lien within said ten .... - .
ten (10) days following the determination of the fair market value pursuant
this ,lien be released and Seller notifies Purchaser in writing of Seller's refusal to release this lien due to noncompliance with the conditions of Part I ... hereof, the Additional Purchase Price shall be due and payable within ten (10)
If the Additional Purchase .Price is not paid when due and payable pursuant" ....... .. to this Section, it shall bear .interest at the rate of ten percent (lo?) per .:": ........
... .- .. If within said first ten (10) day period Purchaser requests that
....
.- days following the determination of the fair market value pursuant'to Part V.:
....... ...... annum from said date until paid.. ... .- .. .. ....... ........ ..... ..... ..
.... ....
.. .. _. .
.. . ._ ..
..
.: ~
I.
_- . .. : . .. .. ... .. ... .'2.5 Purchaser's Carrying and Improvement Costs' Defined.. For the -.purposes of Section 2.2 above, "Purchaser's carrying and improvement costs"
-. . '. . 1-
_-
i . .. shall be defined to'mean the aggregate of the following:.'^:.. - . .- ., ' .
. -. .... .. ......... ... .. :-. .- ..
. :
for the Property; ..: :- 1:. I :.'.,-
(a) .The or-iginal'purchase. price paid.by"Purchaser, to Se1,jer' ... . ' ............... ._ . .... . .- .. . .... .' .-.. . ... ............ ..... .. .. . : .. . _. . ~ . ~ .. - .* ........... .. .. ....... .-. ... . --..
2. ... ..
... .. ..:.-.... .. _. . I .. , :. ' . . -(b) Real .... .property. ... taxes paid by .P.urchaser ... for the Property; .. ... '. ...... ...... _. .. -
..I.. .. _. . ,:. -. .. ..*
.. : ::. ,I .(c) ."Homeowners association dues paid by..Purchaser for "the ..;. . - . .'.
... ..... .. .. ..... .... . . .' ... .... .... . _. .. .. . J.: ' . ._. .-. .. .. .. ._. .; .
... 0- . .-: . t.
-. interest'ini i'oan costs paid by Purchaier for any loan,' .. ... .... .. ..the proceeds-of which are used to.purchase and/or improve the Propepty; ........ ... ...... . ._. ........ .. .. .. .. _- .. .. .. ... > *. :' . ..: . (e) ' Insurance'premiums paid by Purchaser. for public liability'.. ' . -- ..
.. ..
.. '. or casualty insuriince .. insuring . .. -. risks . *. incident '.' to . the Property's ownership; . -' . . .: ..
-. . tr . .. .I . .- .- ..
:. .:. . . : -'. (f) . Title,' escrow and closing costs paid by Purc.haser.in - : ..... .. _. . connection with the acquisition from Seller of the Property; and . ...-:I. .. : . ... ... .- ........ . ... .... ... ._ ....... .- . .... . .- . ., ...... _- .... ... - -. .. ,_ __. . _. ._. , Z. - . . - .. .. _. .- .
.. ... (g) 'The actual-'costs, as'shown by-receipts, .of all ...... ... ......
.. ..
.-
A 111. IMP0 'ION OF LIEN
3.1 Creatfon of Mortgage. The Purchaser hereby mortgages to Seller with power of sale the Property for the purpose of securing payment. of the Additfonal Purchase Price.
3.2 Power of Sale, In the event Purchaser fails to pay the . indebtedness secured hereby, Seller may declare a default hereunder and cause a written notice of default and electlon to sell the Property (hereinafter referred to as "Notice of Default") to be prepared and have the Notice of ' .
Default filed for record fn the office of the County Recorder of the county or counties where the Property or any part thereof is located.' After three (3) months or such shorter time as may be allowed by law shall have elapsed from
the recordation of such Notice of Default, and after a notice of sale has been glven to the extent required by the then applicable' law, Seller, without legal action or demand on the Purchaser, shall sell the Property at such time and, ..
, sale is postponed as hereinafter provided without additional notice, either as * a whole or in separate parcels and in such order as Seller may determine. at .
public auction to the highest bidder for cash in lawful money of the United States at the time of sale or upon such other terms as Seller may consider '..
advisable. The Purchaser shall have no right to direct or determine whether . the Property shall be sold as a whole or in separate parcels, or the order of the sale of separate parcels or the portion of the Property to be sold if only a portion is sold. announcement thereof at the time and place of sale and from time to time thereafter by public announcement at the time and place of the preceding . '. - . postponment. Seller in conducting or postponing said sale may act through .- ... the agents, officers or employees of Seller or any other person designated . .
by Seller whether or not such party shaql be a licensed auctioneer. shall del-iver to the buyer or buyers at such sale its deed or deeds conveying the Property so sold, but without any covenant or warranty expressed or implied. The recitals.in such deed or deeds in any matters of fact shall be conclusive proof of the truthfulness thereof against the buyer, its successors and assigns, and all other persons. The Purchasers
. hereby agree to surrender immediately and without demand possession of said . , Property to the buyer at such sale.
'.
.. ..
. .
. .place fixed in said notice of sale or at the time and.place to which the
,.
..
.' .
Seller may postpone the sale of the Property by public
Seller
.
Any person may purchase at such sale.
... .- - .. .... ... ... ........ .. .. .-. .. -. .
.- .. of Proceeds. Seller shall apply the proceeds of ..... .. ........ .. manner and order: .. ..
(i 1 . expenses of Seller. attorneys' fees; ,-
, . (ii)
1- (iii) entitled thereto. ..
'. . .. . '- Expenses of.such sale and all costs, fees, charges and ..:. . including costs of evidence of title and reasonable '
-' .. -.,
'All sums secured 'hereby; .and _.
me remainder,' i f any; to the person 'or persons legally . .
....... , . .'. .. ... .. ... .... ' .. .... ..
.. ......
.. , .. ..
........ ..... .. r- . .. ,. ;. .. .. ..
'
... ... ... ... ... .. - .. .... ..
.. ..
.. .-. .. .. . .;
.. ... . -3.4 'Foreclosure by Court Action.. In addition, Seller may' foreclose '
the lien created.hereby by court action in the manner provided by the laws .. . ....
then applicable to this indenture 'in which the Purchaser agrees to pay all costs. and expenses thereof, including reasonable attorneys' fees as the court may 1 determine. .... .... r . , .. .... .. ....
.. ..
._
*. -. ..._. ..
: 3.5 Certain Waivers. .The Purchaser hereby waives the right to .- . require Seller to proceed with any sale or to otherwise enforce its rights . hereunder until the date specified in Section 1.2 hereof. If Seller has not .. proceeded to enforce its rights hereunder prior to such date, this lien shall thereupon be automatically released and of no further force or effect. Speci-
fically, Seller shall not be required to enforce'its rights, or conduct a sale . . hereunder in the event Purchaser does not pay the Additional Purchase Price hereunder, but, it is agreed'that Seller.rnay postpone collection- thereof and . - , any action.hereunder until said date. Interest shall accrue on all sums .from . . the date then due and payable at the rate of ten percent (10%) per annum until paid or until the date of any sale under the foregoing power of sale or pursuant to a foreclosure by court action as provided above. portion of the Property is the subject of a sale or foreclosure action by ...... Seller hereunder, the lien of this instrument shall continue to attach to all,,:-
.'
*-
In the event that only a
... / .. .. .(
, -4- t .. ... I ' '.
'- . .
other portions of such sale or foreclosure. the Property which are subject t-- the lien hereof at the time
3.6 Notice of Sa&: The .Purchaser hereby requests that copies of the Notice of Default and any notice of sale hereunder be mailed to it at the address set forth opposite its signature hereto. any such notice or demand shall be deemed fully given to Purchaser if mailed, to it by registered mail at the address set forth opposite its signature.:
Purchaser agrees that :
.. . . _. . .. .. .. . . >. . .. .. IV. SUBORDINATION OF LIEN' .: . 'I
The lien created by this indenture shall be subordinate and inferior '
to the lien of any mortgage or deed of trust securing a loan made by a bank, ' savings and loan or other institutional lender or any other lender approved by Seller, the proceeds of which are used to purchase and/or improve the Property.
. following itenis, and provided there is no default hereunder, to execute, acknowledge and deliver to the Purchaser an instrument in recordable form
.. . (a). A true and complete copy of the executed deed of trust and
Seller agrees within ten (10) working days after receipt of the '. -'
..
.-
confirming such' subordination: .-
. .; note secured thereby and all other instruments evidencing or securing the . _. , . -. ..
indebtedness evidenced by said note. . . ..
.. .. . ... ,-
(b) A copy of the executed'construction loan or building loan .. agreement or other agreement pertaining to the disbursement of funds (which . '
. . must provide in a manner satisfactory to Seller that the funds disbursed . ' thereunder will be used to improve and benefit the Property), or other evidence satisfactory to Seller that the proceeds of such loan will be used .. _. .
.
.. to purchase, improve or benefit the Property. .. _. .. ..
(c) A copy of a Request for Notice of Default pursuant to Section . . 2924(b) of the California Civil Code prepared for execution and acknowledgement by Seller which wh.en recorded at the expense of Purchaser will entitle Seller
to the notices prescribed by Section 2924(b) of the California Civil Code. .. .-
be executcd.by Seller free of charge upon the satisfaction of the above . -. conditions; provided, however, thereafter Seller may at its option require ..... a payment by Purchaser of One Hundred Dollars ($100) as a condition to the . j".., ..
. . ..-
.. . .. -The first such recordable instrument requested by Purchaser shall . . .. . .
-. .\
. ._ .. execution of any such subsequent recordable instruments. . -. ... .
..
.- .
. . V. DETERMINATION OF' FAIR MARKET VALUE
I , .. _.. . .. . -. . ., ' : '. Where it is necessary to detenine fair market value for purposes ' - - . ,' of this indenture, fair market value shall be determined by written agreement. ; ' between Seller and the Purchaser, or, in the absence of such an agreement, by an appraisal conducted in the following manner:
.. ' 5.1 'One' Appraiser. :The parties may agree in ,writing on one appraiser' ,
and. the determination of fai.r market value by such appraiser shall be the.- .. ... . :. appraised .value for the purposes of this Agreement; or
. ..,,'
single appraiser pursuant to the foregoing section, each party shall name an appraiser who is a member of the American Institute of Real Estate Appraisers, . e' The appraisers so named shall. designate a third appraiser. ' Each of the appraisers so named shall conduct an independent appraisal of the Property to determine its fair market value. The three (3) figures then obtained shall be compared . and the two (2) closest in value shall be mathematically averaged with the: . third figure being disregarded. value of the Property for purposes of this indenture. Should either party fail
thirty (30) days after a written notification from Seller to Purchaser then .an ;- appraisal will be required, the single appraiser named by the other party shall conduct an independent appraisal which shall constitute the fair market value of .+ ., ' the Property,. Each party shall pay the fees and expenses of the appraiser .': appointed by it and one-half of the fees and expenses of the third appraiser.
-5-
.'. ._. . .
.. .. .. . ... * , . '. ..
.. ..
.. .. .~ ., .. .. .. . .. .. _. ._ ._ .. .. .. ..
" . ' 5.2 . Three Appraisers. In the event the parties do not agree .on a .: . .
. . ,. . . .
The result of such averaging shall be the appraised .
. , ., to name an appraiser and notify the other party thereof in writing within . . : ..
. . ..
. . -_
.. * .. -1,; . . .-. .. .. .. .. ... .
..
. .. .
,. .. .. I .. .. U
YI . MI SCEl "UEOUS
6.1 Pa ,ent for Statcnient of Obligations. 8urchaser shall, 1 in addit-ion to A- ot er payments specified herein, pay to Seller the sum of Fifteen Dollars ($15.00) for each statement requested by Purchaser regarding the obligation secured by this indenture except for such statements as are exempt from charge by virtue of the laws of the State of California.
the lien createnad be irrevocable by Purchaser and shall be governed by and construed according to the laws of the State of California.
of, and binds thereto the parties hereto, their heirs, legatees, devisees, administrators, executors, successors and assigns and shall run with and burden the Property.. .
requires, the masculine, feminine and neuter genders include each other and the singular includes the plural. have been inserted for convenience only and shall not in any way affect the interpretation or construction thereof.
.
6.2 Irrevocabilit and Applicable Law. This indenture and
-
6.3 Successors. This indenture appl-ies to, 'inures to the benefit
..
6.4 Construction. In this indenture whenever the context so .
The article and paragraph headings
6.5 Counter arts This indenture'may be ex.ecuted in one or more counterparts, emshall be an original but all of which shall
constitute one and the same instrument.
Notices. ~ Any notice pursuant to this Lien Instrument shall be deemed givenwhen-delivered personally to Purchaser, or one of themi or . to an officer of Sel1er.or upon deposit in the U.S. mail postage prepaid, certified mail and return .receipt requested, addressed to the other party at the address specified beside the signatures below or at such other address as has been designated to the other party in a notice given pursuant to this Section. .. , ,.:
.. .-
6.6 .
- .
6.7. Sole Recours-e. .In the event this Lien Instrument . ..
released from Seller's waiver of Seller's right to rescind specified in ..
Paragraph D hereof. and Purchaser's Lole recourse shall be to have the lieh . .
shall be declared invalid, illegal or unenforceable, Seller shall be . ,. ~
-J
hereof released as-an encumbrance to Purchaser's title to the Property.
imposition or enforcement of this .. Lien Instrument. . .. . ..
- -.
Without 1 imiting the generality of the foregoing, Purchaser. specifically
.waives any right to obtain from Seller any damages in connection with .. the
.. .. .. .. . PROPERTY . . . ,-
ADDRESS . .. . .. . e. .. . PURCHASER^^ . . ... . .. .. .
..' .. .. _r . ..
-. . 8.
.. .. .- .- .. - -- _. .._.
"SELLER" ADDRESS
LOS ALISOS VENTURE, a limited partnership By: BUILDERS CONSORTIUM FOR AFFORDABLE 2001 East Fourth Street, Suite 220 Santa Ana, California 92705 HOUSING, general partner
By :
1
2
3
4
5
6
7
a
9
10
11
12
12
14
1E
1E
17
1E
1:
2c
21
22
2;
24
2:
2c
2';
2E
ORDINANCE NO.
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, AMENDING TITLE 21 OF THE CARLSBAD MUNICIPAL CODE BY THE ADDITION OF CHAPTER 21.70 TO PROVIDE FOR CONSIDERATION OF DEVELOPMENT AGREEMENTS.
The City Council of the City of Carlsbad, California, does ordain as
fol 1 ows :
SECTION 1: That Title 21 of the Carlsbad Municipal Code is hereby
amended by the addition of Chapter 21.70 to read as follows:
Chapter 21.70
DEVELOPMENT AGREEMENTS
Sections : 21.70.005 21.70.010 21.70.020 2 1.70.030 21.70.040 21.70.050 21.70.060 21.70.070 21.70.080 2 1.70.090 21.70.100 21.70.110 21.70.120 21.70.130
21.70.140 21.70.150 21.70.160
Authority for adoption. Forms and information. Fees. Qualification as an applicant. Proposed form of agreement. Review of application. Transmittal to Planning Commission. P1 anni ng Commi ss i on Report. Decision by City Council. Approval of Development Agreements. Required notice. Irregularity of proceedings. Amendment and cancellation of agreement by mutual consent. Recordation. Periodic review. Procedure for periodic review. Modification or termination.
21.70.005 Authority for adoption--applicability. This chapter adopted under the authority of Government code Sections 65864-65869.5. chapter shall be applicable to housing developments for individuals and families earning not more than 150% of the median income for the County
S This
of San Diego, adjusted by family size; As published by the California Department of Housing and Community Development, or a)
b) As determined by survey conducted by the City of Carlsbad.
21.70.010 Forms and information. (a) Except as otherwise provided in this chapter, the Planning Director shall prescribe the form for each applicatic notice and document provided for or required under this chapter for the preparation and implementation of development agreements.
, ,1
2
3
4
5
6
7
a
.9
10
11
12 a
19
20
21
22
,23
24
25
26
27
2a
(b) The Planning Director may require an applicant to submit such information and supporting data as the Planning
Director considers necessary to process the appl.ication.
21.70.020 Fees. (a) A fee established by City
Council resolution shall be paid by the applicant at the time of
filing the application.
applicant from the obligation to pay any other fee for a city approval, permit- or entitlement. required by this cade.
(b) Nothing in this chapter shall relieve the
21.70.030 Qualification as an applicant. Only a
qualified applicant may file an application to enter into a development agreement. A qualified applicant is a person who
has legal or equitable interest in the real property which is
the subject of the development agreement. Applicant includes authorized agent. The Planning Director shall require an
applicant to submit proof of his interest in the real property
and of the authority of the agent to act for the applicant. Before processing the application the Planning Dj-rector shall obtain the. opinion of the City Attorney as to the sufficiency of
the applicant's interest in the real property to enter into the
agreement.
21.70.040 Proposed form of agreement. Each application shall be accompanied by the form of development
agreement proposed by the applicant. The City Council may adopt
by resolution a standard form of development agreement, The * applicant may choose to use the standard form and include
specific proposals for changes in or additions to the language
of the standard form. The proposed agreement shall contain all
the elements required by Government Code Section 65865.2 and may include any other provisions permiteed by law, including requirements that the applicant provide sufficj-ent securj ty
approved by the City Attorney to ensure provisian of public
facilities.
21.70.050 Review of application. (a) The Planning
Director shall review the application and may reject i.t if it is
incomplete or inaccurate for processing. If he finds that the application is complete, he shall accept 'it for filing.
(b) The Planning Director shall rev-iew the
application and proposed agreement and shall. prepare a report
and recommendation to the Planning Commi.ssion on the agreement.
application and proposed agreement to the City Attorney for
review. The City Attorney shall prepare a report and
recommendation to the Planning Commission on the agreement.
application and proposed aqreement
and Redevelopment Advisory Committee for review. The Committee
shall prepare a report and recommendation to the Planning
Commission on the agreement. The Committee may, but need not,
hold a public hearing on the agreement.
(c) The Planning Director shall forward a copy of the
(d) The Planning Director shall forward a copy of the
to the Housing
-2-
.. .
It ,1
3
4
5
6
7
e
9
1c
11
XS
2c
21
22
2:
24
2:
2e
2i
2E
21.70.060 Transmittal to Planning Commission. "he
Planning Director shall transmit the application to the PlannLng
Commission for a public hearing when all the necessary reparts
and recommendations are completed. Natice of the public hearing
shall be given as provided in this chapter. The application for
a development agreement may be considered concurrently with
other discretionary permits for the project .. ///
///
///
///
///
///
///
///
///
///
///
/I/
///
///
///
///
/I/
///
///
///
/// -3-
.
' c1
2
3
4
5
6
7
a
-9
10
I1
19
20
21
22
23
24
25
26
27
. 2a
21.70.070 Planning Commission report. After a public
hearing, the Planning Commission shall consider the application
and prepare a report and recommendation for the City Council, The report and recommendation shall include findings on the matters stated in Section 21.70.080 (b) . This report and
recommendation shall be forwarded to the City Clerk who shall set the matter for public hearing before the City Council.
City Council completes the public hearing, it may approve,
modify or disapprove the develapment agreement. It may refer matters not previously considered by the Planning Commission
during its hearing back to the Planning Commission for report
and recommendation. The Planning Commission need not hold a
public hearing on matters referred back to it by the City
Council .
' (b) The City Council shall not approve the development
agreement unless it finds that the agreement:
general land uses and programs specified in the general plan
and any applicable specific plan:
the regulations prescribed for, the land use district in
which the real property is located and all other provisions of Title 21 of this code.
welfare and good land use practices;
and general welfare;
of property or the preservation of property values:
Code Sections 65864-65869.5.
manner consistent with the general plan.
of Title 20 of this code.
21.70.080 Decision by City Council. (a) After the
(1) Is consistent with the objectives, policies,
(2) Is compatible with the uses authorized in, and
(3) Is in conformity with public convenience, general
(4) Will not be detrimental to the health, safety
(5)
(6) Is consistent with the provisions of Government
(7) Ensures provision of public facilities in a
(8) When applicable, is consistent with the provi.sians
Will not adversely affect the orderly development
21.70.090 Approval of development agreements. If the
City Council approves the development agreement, it shall. adopt an ordinance approving the agreement'and directing the Mayor to execute the agreement after the effective tiate of the
ordinance on behalf of the City. Before execution, each agreement shall be approved as to form by the City Attorney,
21.70.100 Required notice. (a) Notice of public- hearing required by this chapter shall be given as provided in Section 21.54.060 of this code.
(b) The notice requirement referred to in subsection (a)
is declaratory of existing law (Government Code Sections 65867,
65854, 65854.5 and 65856). If state law prescribes a different
notice requirement, notice shall be given in that manner.
by law or these regulations, does not affect the authority of the City to enter into a development agreement.
(c) The failure of any person.to receive notice required
L 4-
1
1
1
2
2
2
2
2
2
2
2
2
x
21.70.110 Irregularity in proceedings. No action,
inaction or recommendation regarding the proposed development
agreement shall be held void or invalid or be set aside by a
court by reason of any error, irregularity, informality, neglect or omission as to any matter pertaining to petition, application, notice, finding, record, hearing, report, recommendation, or any matters of procedure whatever unless after an examination
of the entire case, including the evidence,'the court i.s of
the opinion that the error complained of was prejudicial and that by reason of'the error the complaining party sustained and suffered substantial injury, and that a different result
would have been probable if the error had'not occurred or existed.
There is no presumption that error is prejudicial or that injury was done if error is shown..
21.70.120 Amendment and cancellation of agreement by mutual consent. or cancellation in whole or in part of the development agreement previously entered into. by this section must be by mutual consent of the parties.
amendment to or cancellation in whole or in part of the develop- ment agreement is the same as the procedure for entering into an agreement in the first instance, However, where the City initiates the proposed amendment to or cancellation in whole or
in part of the development agreement, it, shall. first give notice to the property owner of its intention to initiate such proceed-
ings at least thirty days in advance of the' giving of public notice of the hearing to consider the amendment or cancellation.
(a) Either party may propose an amendment to
The amendment or cancellation permitted
(b) -The procedure for proposing and adoption of an
21.70.130 Recordation. (a) Within ten days after the
City enters into the development agreement, the City Clerk
shall have the agreement recorded with the County Recorder. If the parties to the agreement or their successors in' interest amend or cancel the agreement as provided in Government
Code Section 65868, or if the City termhates or modifies the
agreement as provided in Government Code Section 65865.1 for failure of the applicant to comply in good faith with the terms or conditions of the agreement the City Clerk shall have notice of such action recorded with the County Recorder,
(b)
21.70.140 Periodic review. (a) The City Council shall review the development agreement every twelve months from the date the agreement is entered into..
(b) The time for review may be shortened either by
agreement between the parties or by initiation in one or more of the following ways: (1) Recommendation of the Planning Director.
(2) Resolution of intention by the Planning
(3)
Commission.
Resolution of intention of the City Council.
(c) The Planning Director shall begin the review proceeding
by giving written notice that the City Council intends to uncler-
take a periodic review of the development agreement to the
property owner. He shall give the notice at least ten days
- 5-
4
5
6
'. 7
8
9
10
11
19
20
23.
22
23
24
25
26
27
28
in advance of the time at which the matter will be considered by
the Council.
Zommission for review and recommendation,
(d) The City Council may refer the matter to the Planning
21.70.150 Procedure for periodic review, (a) The City
Zouncil or the Planning Commission, if the matter has been referred, shall conduct a public review hearing at which the
property owner must demonstrate good faith compliance with the terms of the agreement. The burden of proof on this issue is upon the property owner.
substantial evidence whether or not the property owner has, for
the period under review, complied in good faith with Ehe terms and conditions of the agreement. (c) If the City Council finds an6 determines on the basis
of substantial" evidence that the property owner has complied in
good faith with the terms and conditions af the agreement during the period under review, no other action is necessary..
(d) If the City Council finds and.determines on the basis of substantial evidence that the applicant has not complied
in good faith with the terms and conditions of the agreement
during the period under review, the Council, may i.nitiate proceecl- ings to modify or terminate the agreement.
'21.70.'160 Modification or termination. (a) If upon a-
(b) The City Council shall determine upon the basis of
finding under Section 21.70.150 (d) Councii-determines to modify or terminate the agreement, the Council shall give notice
to the property owner of its intention so to do. The notice
shall state:
(1) The time and place of the hearing, (2) A statement as to whether or not the Council
(3) Other information which the Council considers
proposes to terminate or to modify the development agreement;
necessary to inform the property owner of the nature of the
proceedings.
hearing held according to Section 21,70,150.
cation or termination, the property owner shall be given an opportunity to be heard. The Council may refer the matter back to the Planning Commission for further proceedings or for report
and recommendation. The Council may impose those conditions ta
the action it takes as it considers necessary to protect the interests of the City. The decision of the City Council is final,
21.70.170 No damages on termination. (a) In no event shall
Such notice may be given at the conclusion of the -
(b) At the time and place set for the hearing on modifi-
the applicant or his successors in interest be entitled to any
damages against the City upon termination of the agreement.
21..70.180 No vesting of rights. Approval and construction
of a portion or phase of a devcloprnent pursuant to the agreement
shall not vest any rights to construct the remainder or any other portion of the development nor create any.vested rights
to the approval thereof if the agreement is terminated as
., .' .
. " ,]
i
?
4
F
t
7
€
s
IC
11
0 le
19
20
22
22
23
24
25
26
27
. 28
provided in this chapter.
21.70.190 Reservation of rights, The City Council of the City of Carlsbad reserves the right to terminate or modify any
development agreement after'a public hearing if such termination or modification is reasonable and necessary ta protect the public
health, safety or welfare."
EFFECTIVE DATE: This ordinance shall- be effective thirty
days after its adoption, and the City Clerk shall certify to
the adoption of this ordinance and cause it to be published at
least once in the Carlsbad Journal within fifteen days after
its adoption.
INTRODUCED AND FIRST READ at a regular meeting of the
Carlsbad City Council held on the - day of I
1981, and thereafter
PASSED AND ADOPTED at a regular meeting of said Council
held on the day of 1981, by the following
vote, to wit:
AYES :
NOES:
ABSENT :
ROXALD C. PAC=, Mayor
ATTEST :
ALETHA L. RAUTENKRANZ, City Clerk