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HomeMy WebLinkAbout1998-07-28; City Council; 14792; Kelly Ranch Inclusionary Housing Requirement- ".. dTY OF CARLSBAD - AGENtA BILL 46# 14,792 DEPT. HD. TITLE: REQUEST TO APPROVE AN AFFORDABLE HOUSING JITG. 71 281 98 AFFORDABLE APARTMENT UNITS NECESSARY TO SDP 98-4 CITY MGR. FOR THE KELLY RANCH PROJECT IEPT. HIRED SATISFY THE INCLUSIONARY HOUSING REQUIREMENT CITYATTY. @' AGREEMENT 'FOR THE DEVELOPMENT OF 132 RECOMMENDED ACTION: That the City Council ADOPT Resolution No. 98-257 , to APPROVE the Affordable Housing Agreement for the development of 132 Affordable Apartment Units necessary to satisfy the lnclusionary Housing Requirement for the Kelly Ranch Project. ITEM EXPLANATION: The Kelly Land Company is proposing to construct up to 877 housing units for the Kelly Ranch Project. The proposal includes 382 single family homes and a 495 unit apartment project. All of the single family homes will be sold at "market rate" prices. The apartment project will be a mixed-income development and will include 363 market rate units and 132 units affordable to low income households (80% of the Area Median Income). The 132 affordable units will be disbursed throughout the apartment project and include 1, 2 and 3 bedroom units to satisfy the inclusionary housing requirement for the Kelly Ranch Project. To date, the developer has received approval of a tentative map for the development of 144 single family homes in Planning Area E (see map provided as Exhibit 3). Before the final map may record, however, an Affordable Housing Agreement must be approved by the City Council, executed and then recorded against the Kelly Ranch property. With the provision of additional security by the developer (as explained below) and recordation of the attached Affordable Housing Agreement, market rate building permits will be released for Planning Area E only. No additional Planning Areas will be released for development until the Site Development Plan is approved for the affordable housing. Affordable Housina Aareement When an affordable housing agreement is presented to the City Council for approval, there is also a corresponding approved Site Development Plan (SDP), or a SDP which has been recommended for approval. The SDP provides the details of the Affordable Housing Project as related to unit floor plans, bedroom size, design, parking, etc. In this particular instance, City staff has not completed its review of the related Kelly Ranch SDP and, therefore, has not provided a formal recommendation for approval. However, in order to allow the Kelly Land Company to proceed, staff agreed to process the Agreement with the proposed SDP submitted by the Kelly Land Company. However, it should be noted that the SDP must still continue through the formal staff review process for a complete identification of issues and concerns. The SDP may need to ultimately be changed based on staffs complete review. The Affordable Housing Agreement, together with the proposed SDP, includes information on how the affordable housing is to be provided and the timing for its construction as related to market rate development. The lnclusionary Housing Ordinance authorizes the Community Development Director to execute affordable housing agreements. In the past, the Community Development Director has executed only those agreements which set forth the basic requirements of the developer and are consistent with the lnclusionary Housing Ordinance. Due to the fact that the proposed agreement represents a change in policy, staff believes that City Council action is required to approve the subject Agreement. The draft Affordable Housing Agreement prepared by staff was not entirely acceptable to the developer. However, since the developer was eager to obtain approval of an Agreement, it was I AB# 14,792 Page 2 forwarded to the Housing Commission for review as recommended by staff. The key terms incorporated into the draft agreement are highlighted below. Issues related to the terms of the Agreement raised by the developer and the public during the Commission meeting are also outlined below. Kev Terms of Aqreement Total Units and Location. A total of 132 apartment units (out of 495 apartment units) in Planning Areas D, G and H will be restricted and affordable to households with incomes not exceeding 80% of the Area Median Income for 55 years. Security. Because Planning Area E will be allowed to move forward, ahead of approval of the SDP for the affordable housing, the developer must provide additional security to ensure satisfaction of the affordable housing requirement (22 units) for Planning Area E. The security required is a $220,000 cash deposit or letter of credit and a grant deed executed for Planning Areas D, G and H. The security is released upon approval of the required SDP for the affordable housing project. Phasing. Upon approval of the affordable housing agreement by the City Council and provision of the security noted above, building permits can be released for Planning Area E (144 units). Once the SDP is approved, the apartment project site is graded, and the site is posted with signs indicating the forthcoming apartment project, an additional 242 building permits can be released. After building permits have been issued and the foundations for at least 132 apartment units are complete, inspected and approved, another 346 building permits can be released. Finally, upon final Certificate of Occupancy and rent restrictions on a total of 132 units, the remaining 145 building permits can be released for market rate housing within Kelly Ranch. Housinq Commission Review On July 9, 1998, the Housing Commission received public input and reviewed and discussed the draft Affordable Housing Agreement for Kelly Ranch. During the Commission meeting, there were three key issues discussed as related to the Agreement - Phasing, Additional Security and Affordability. Phasinq. The first issue discussed by the Commission was the developer's request that the subject Agreement be amended to clarify language regarding the project's construction phasing and the timing for provision of the affordable units. The Commission concurred with the developer's request and recommended amendment of Exhibit B to the agreement as indicated in Exhibit 4. For information purposes, Exhibit 4 to this report is a redlined version of the Affordable Housing Agreement which indicates corrections or changes made to the agreement subsequent to review and action by the Housing Commission. Exhibit 5 represents the final agreement which is recommended for approval by the City Council. Additional Security. The second issue was related to the provision of the additional security required for Planning Area E. In the past, a development has received approval of their Affordable Housing Agreement and the SDP for their affordable housing project before a portion of building permits for the market rate development may be issued and construction may begin. In this instance, the developer is requesting that the market rate development in Planning Area E (144 units) be permitted to commence once the Affordable Housing Agreement is approved, but ahead of formal approval of the SDP. To allow for this request, staff has recommended that the developer be required to provide additional security in the form of a cash deposit or letter of credit in the amount of $220,000, and documentation 2 AB# 14,792 Page 3 to execute a grant deed for Planning Areas D, G and H within the Kelly Ranch Project. The security will be held until the SDP is approved by the City Council for the proposed affordable housing project. At the discretion of the City, the City may assume ownership of the land and obtain the cash, if the SDP is not approved by June 1. 2000. If the SDP is approved by the Council, the security (cash and land) is released upon approval. The Developer does not agree with the security requirement. The developer has proposed that the security be limited to $220,000 and the grant deed of land for Planning Area D only. The Developer believes that Planning Area D and $220,000 are more than adequate security for the 22 units required for Planning Area E. It is staffs position, however, that the developer's proposal is not adequate to insure that the required number of affordable units (22 units) could be constructed. The Developer requested consideration from the Housing Commission of the alternate security proposal noted above. The Commission concurred with staffs recommendation on the required security and recommended no changes to the Agreement on this issue. Affordabilifv. The final issue of Commission discussion related to the level of affordability for the apartment project and a desire to have lower levels of affordability (i.e. 60% or 70% of the Area Median Income). The City's lnclusionary Housing Ordinance (Carlsbad Municipal Code Chapter 21.85) requires that rent levels be restricted to a minimum of 80% of the Area Median Income. As a result of testimony from a few Section 8 Rental Assistance participants regarding affordable housing in Carlsbad, the Housing Commission requested that staff meet with the developer to 1) discuss the potential for reducing the rent levels of a specified number of units within the proposed affordable housing project in exchange for financial assistance from the City, and 2) to obtain agreement from the developer to participate in the Section 8 Rental Assistance Program. The Commission agreed to allow the Affordable Housing Agreement to move forward to the City Council without any recommendation on reduced rents, or a requirement to participate in the Rental Assistance Program. However, the Commission did request that staff meet with the developer in an effort to reach a favorable agreement. If an agreement can be reached between staff and the applicant, the agreement will be returned to the Housing Commission at a later date for a recommendation on any required financial assistance. Housincl CommissionlStaff Recommendation The Housing Commission took action at their July gth meeting to recommend approval of the attached Affordable Housing Agreement, with the understanding that the final SDP would be returned to them at a later date for review. It is staffs recommendation that the City Council take action to approve the attached Affordable Housing Agreement (Exhibit 5) as recommended for approval by the Housing Commission. No action is requested at this time on the proposed Site Development Plan. FISCAL IMPACT: The approval of the Affordable Housing Agreement will have no fiscal impact to the City. EXHIBITS: 1. City Council Resolution No: 98-257 2. Housing Commission Resolution No. 98-010 3. Kelly Ranch Locator Map 4. Affordable Housing Agreement (Redlined) 5. Affordable Housing Agreement 6. Housing Commission Staff Report of July 9, 1998, with reduced Site Development Plan 3 1 2 < 4 5 6 7 a 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -. - CITY COUNCIL RESOLUTION NO. 98-257 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, TO APPROVE THE AFFORDABLE HOUSING AGREEMENT FOR THE DEVELOPMENT OF 132 AFFORDABLE APARThENT UNlTS NECESSARY TO SATISFY THE MCLUSIONARY HOUSING REQUIREMENT FOR THE KELLY RANCH PROJECT. CASE NO: SDP 98-4 APPLICANT: KELLY LAND COMPANY & FTR DEVELOPMENT WHEREAS, the City of Carlsbad has identified a need to provide housing which is af€ordable to low income households in a variety of different forms; and WHEREAS, a project known as the “Kelly Ranch Project” has applied, or will apply, for approval to develop 877 housing units on property generally the south of the fiture extension of Cannon Road, and west of El Camino Real; and WHEREAS the development of 877 housing units will require the development of 132 homes affordable to low income households as defined by Carlsbad Municipal Code Chapter 21.85; and WHEREAS, Carlsbad Municipal Code Chapter 21.85 requires the developer of a residential development to receive approval of an Affordable Housing Agreement which details how the requirements of the Inclusionary Housing ordinance shall be met; and WHEREAS, on July 9, 1998, the Housing Commission did hold a public meeting to consider a request to approve the Wordable Housing Agreement for the Kelly Ranch Project; and WHEREAS, at said public m&g, upon hearing and considering all testimony, if any, of all persons desiring to be heard, said Housing Commission considered all factors relating to said request and voted to approve said agreement; and WHEREAS, on July 28, 1998, the City Council did hold a public meeting to consider a request to approve the Affordable Housing Agreement for the Kelly Ranch Project; and WHEREAS, at said public meeting, upon hearing and considering all testimony, if any, of all mns desiring to be heard, said Council considered all factors relating to said request: NOW, THEREFORE, BE IT HEREBY RESOLVED by the City Council of the City of Jarlsbad, California, as follows: . 1 2 .: 4 C E 7 8 9 10 11 12 13 14 15 16 17 10 19 20 21 22 23 24 25 26 27 28 1. 2. 3. 4. 5. The above recitations are hue and correct. The request for approval of the Affordable Housing Agreement for the KeUy Ranch Project was recommended for approval by the Housing Commission of the City of Carlsbad on July 9, 1998 as recorded in Housing Commission Resolution No. 98-010. The Affordable Housing Agreement has been determined to be consistent with the goals and objectives of the City of Carlsbad's Housing Element and Consolidated Plan, the Inclusionary Housing Ordinance, and the Carlsbad General Plan. The request for approval of the Affordable Housing Agreement for the Kelly Ranch Project will satisfy the requirements of the City's Inclusionary Housing Ordinance, as dehed in Carlsbad Municipal Code Chapter 21.85, for the development 877 housing units, of which a minimum 132 units will be affordable to low income households. That based on the information provided within the City Council Staff Report and the testimony presented during the public meeting of the City Council, the City Council hereby APPROVES the Affordable Housing Agreement for the Kelly Ranch Project between the City of Carlsbad, Kelly Land Company and F'TR Development as required for the of 877 housing units, of which a mioimum 132 units will be affordable to low income households. That the City Council hereby authorizes the Community Development Director to execute the AtTordable Housing Agreement, in substantially the form presented to the City Council on July 28, 1998, and subject to review and approval by the City Attorney. PASSED, APPROVED, AND ADOPTED at a regular meeting of the City Council of the City of Carlsbad, Califomia, held on the 28* day of July, 1998 by the following vote, to wit: AYES: Council Members Lewis, Finnila, Nygaard, and Hall NOES: None ABSENT: Council Member Kulchin ABSTAIN: A'ITEST: A :/> "J I. * c- ALETHA L. RAUTENKRhZ, CITY CLERK ' (SEAL) -2- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 20 - Exhibit 2 HOUSING COMMISSION RESOLUTION NO. 98410 THAT THE HOUSING COMMISSION RECOMMEND TO THE CITY COUNCIL APPROVAL OF AN AFFORDABLE HOUSING AGREEMENT FOR THE DEVELOPMENT OF 132 AFFORDABLE APARTMENT UNITS NECESSARY TO SATISFY THE INCLUSIONARY HOUSING REQUIREMENT FOR THE KELLY RANCH DEVELOPMENT. APPLICANT: KELLY LAND COMPANY AND PTR CASE NO.: SDP 98-04 DEVELOPMENT WHEREAS, the developer of the Kelly Ranch Development has proposed to construct 132 apartment units affordable to lower income households as a means to satisfy their affordable housing obligation as permitted by Carlsbad Municipal Code Section 21.85 of the City’s Inclusionary Housing Ordinance; and WHEREAS, the Affordable Housing Agreement for the developer’s proposal to construct said units has been submitted to the City of Carlsbad’s Housing Commission for review and consideration; and WHEREAS, said Housing Commission did, on the gib day of July, 1998, hold a public meeting to consider the Affordable Housing Agreement for said proposal to construct 132 affordable apartment units; and WHEREAS, at said public meeting, upon hearing and considering all testimony, if any, of all persons desiring to be heard, said Commission considered all factors relating to the proposal to construct said affordable housing units NOW, THEREFORE, BE IT HEREBY RESOLVED by the Housing Commission of the City of Carlsbad, California, as follows: 1. The above recitations are true and correct 2. The Affordable Housing Agreement is consistent with the goals and objectives of the City of Carlsbad‘s Housing Element and Consolidated Plan, the Inclusiomy Housing ordinance, and the Carlsbad General Plan. 3. The Affordable Housing Agreement provides a total of 132, one, two and three bedroom affordable apartment units. The project, therefore, has the ability to effectively Serve the City’s housing needs and priorities as expressed in the Housing Element and the Consolidated Plan. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 __ and testimony presented during the public meeting of the Housing Commission on July 9, 1998, the Housing Commission ADOPTED Resolution No. 98-010, recommending APPROVAL to the City of an Affordable Housing Agreement for the potential development of 132 affordable apartment units in order to satis@ the requirements of the inclusionaty housing requirement for the Kelly Ranch Development. 5. That the Housing Commission recommends tha! the City Manager or his designee be authod by the City Council to execute the Affordable Housing Agreement as presented by the applicant to the Commission on July 9, 1998, and subject to review and approval by the City Attorney. General CQndition: 1. That Attachment C of the Affordable Housing Agreement be amended as proposed by the Developer. PASSED, APPROVED, AND ADOPTED at a regular meeting of the Housing Commission of the City of Carisbad California, held on the 9' day of July, 1998, by the following vote, to wit: AYES: Chairperson Dunn-Wehnan, Commissioners: Calverley, Latas, Noble, Rose and Walker. NOES: None. ABSENT: Commissioners: Escobedo and Scarpelli. ABSTAW: None. KATHLEEN DUNN-WELLMAN, CHAIRPERSON CARLSBAD HOUSING COMMISSION DEBBIE. FOUNTAIN HOUSING AND REDEVELOPMENT DlRECTOR HC RESO. NO. 98-010 PAGE 2 7 \? \ Exhibit 3 I 3 i - EXHIBIT 4 RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: City of Carlsbad Ann: City Clerk City Clerk's Office Carlsbad, California 92008 I200 Carlsbad Village Drive ABOVE SPACE FOR RECORDER'S USE AFFORDABLE HOUSING AGREEMENT IMPOSING RESTRICTIONS ON REAL PROPERTY This AFFORDABLE HOUSING AGREEMENT IMPOSING RESTRICTIONS ON REAL PROPERTY ("Agreement"), entered into this day of ,1998 (the "Effective Date"), by and between the CITY OF CARLSBAD, a Municipal Corporation (hereinafter referred to as the "City"), KELLY LAND COMPANY, a Delaware corporation (hereinafter referred to as "Kelly"), and PTR DEVELOPMENT SERVICES INCORPORATED, a Delaware corporation (which is affiliated with Security Capital Pacific Trust, a Maryland real estate investment trust) (hereinafter referred to as "PTR"), is made with reference to the following: A. Kelly is the record owner of certain real property located in the City of Carlsbad, California (the "Kelly Ranch") described in "Exhibit A," which is attached hereto and incorporated herein by this reference. The Kelly Ranch consists of several planning areas, also designated in "Exhibit A," As used herein, the term "Planning Area" shall refer, as indicated, to one or more of such planning areas so designated on "Exhibit A," The various Planning Areas as shown on "Exhibit A" either are, or will become, separate legal parcels in accordance with the applicable legal requirements of the State of California and the City. B. Upon their creation as separate legal parcels, Kelly intends to convey or cause conveyance of record title to Planning Areas K and L, respectively, to other persons pursuant to contractual commitments not related to this Agreement. Any further development activity with respect to either Planning Area K or Planning Area L will be the responsibility of the respective transferee. All of the Planning Areas of the Kelly Ranch, other than Planning Areas K and L, are herein referred to collectively as the "Kelly Ranch Project." Kelly is the developer of the Kelly Ranch Project. C. The parties anticipate that the total number of dwelling units for the Kelly Ranch Project will not exceed eight hundred seventy-seven (877). In order to satisfy the affordable housing requirements for the entire Kelly Ranch Project, it is the intent of the parties that a combined inclusionmy project (the "Combined Project") be developed on Planning Areas D, G and H, for the development of Affordable Units (as hereinafter defined) in relation to unrestricted units ("Market Units") in the Kelly Ranch Project (including the Combined Project) according to the chart set forth in "Exhibit B" . The parties acknowledge that the Affordable Units in the Combined Project will satisfy the inclusionary housing requirements for the Kelly Ranch Project, so long as the aggregate number of dwelling units does not exceed eight hundred seventy-seven (877) for the Kelly Ranch Project. D. Kelly has filed a separate application for tentative subdivision map and site plan with respect to Planning Area E. As of the Effective Date, Planning Area E is the subject of certain development approvals received from the City including without limitation: the Tentative Subdivision Map (C.T. 96-07), Planned Unit Development Permit (PUD 97-04), Hillside Development Permit (HDP 96-13) and Coastal Development Permit (CDP 96-13), approved by Resolution No. 96-68, adopted by the City on April 7,1998. E. Kelly has filed a separate application for a General Plan Amendment, rezoning and a master tentative map (the "Master Tentative Map") with respect to Planning Areas D, F, G, H, I and J, as well as K and L. Planning Areas K and L are being processed merely to create them as legal parcels, with the Master Tentative Map intended to note that further mapping of parcels K and L, respectively, will be required prior to any development of them. Kelly has also filed a proposed amendment to the Zone 8 Local Facilities Management Plan. In addition, Kelly and PTR have filed or intend to file a separate application for approval of a site development plan with respect to Planning Area J, a planned development permit with respect to Planning Area I and a site development plan for Planning Areas D, G and H. F. Kelly and PTR have entered into that certain Purchase Agreement dated , 1998 (the "Purchase Agreement"), whereby Kelly has agreed to sell Planning Areas D, G, H, I and J to PTR subject to the terms and conditions set forth therein. Among other things, said terms require that PTR take Title to all the Master Tentative Map land, but that concurrently with recordation of the final map for such land (i) PTR will Deed Planning Area F to Kelly, and (ii) PTR will Deed Planning Areas K and L to the Kelly Family Trust and to Wayne Callaghan, respectively. G. It is anticipated that the Combined Project will be developed by PTR within Planning Areas D, G and H (the "Security Property"). H. The City issued an approval for Planning Area E subject to certain conditions of approval, including a requirement that Kelly enter into an Affordable Housing Agreement in which Kelly causes to be provided at least twenty-two (22) units affordable to low income households (the "Planning Area E Inclusionary Requirement"). NOW, THEREFORE, in consideration of the mutual covenants and promises of the parties herein contained, it is mutually agreed by and between the undersigned parties as follows: 1. Satisfaction of Affordable Housing Oblieation and Conditions of Auuroval. In order to satisfy the Conditions of Approval for CT 96-07 and the requirements of the City’s Inclusionary Housing Ordinance, Carlsbad Municipal Code Chapter 21.85, the developers of Kelly Ranch shall provide a minimum of one hundred thirty-two (132) units which shall be restricted and affordable to lower income households according to the schedule and terms contained herein. This Agreement is an Affordable Housing Agreement pursuant to Section 21.85.030(b)(5) of Chapter 21.85 of the Carlsbad Municipal Code. Developer shall submit this Agreement to the City and this Agreement shall be recorded concurrently with the recordation of the final map for Planning Area E. I 2. Inclusionary Reauirements for Planning Area E. Prior to the recordation of the Affordable Housing Agreement, Kelly has voluntarily agreed to provide additional security to insure the construction of the Affordable Units required for -Planning Area E. The I additional security will include (1) a cash deposit or letter of credit in the amount of $220,000, (2) The recordation of a deed restriction, in a form acceptable to the City of Carlsbad, upon S4ll;tgesPlanning Areas D, G and H which will limit development to that which can satisfy the I affordable housing requirement for the Kelly Ranch Project, and (3) executed and acknowledged grant deeds from Kelly and PTR to the City for Planning Areas D, G, and H, suficient to convey title to the City (the “Security Grant Deeds”). The City shall hold the Security Grant Deeds as additional security for the Developer’s construction of the Affordable Units required for Planning Area E and shall not accept the grant4 deeds or record them in the Official Records of the County of San Diego unless it so elects in t6e event the Developer fails to obtain Site Development Plan approval for the Combined Project prior to June 1,2000, as required pursuant to Section 2.1 below. The acceptance and recordation of the Security Grant Deeds shall be solely at the discretion of the City. The additional security is not an In-Lieu contribution as defined by Chapter 21.85 of the Carlsbad Municipal Code. Subsequent to the recordation of this Agreement, the developer of Planning Area E shall be entitled to construct up to a maximum of one hundred forty-five (145) Market Units. 2.1 Satisfaction of the Inclusionarv Reauirements for Plannine. Area E Upon City approval of a Site Development Plan for the Combined Project, as defined in Section 4.1 below, City inspection and final approval of the grading of J”P1anning Areas D, G and H, and the I installation by Kelly of one or more signs on the subject property acceptable to the City identifying the future apartment project to the satisfaction of the City, the additional security obligations described in paragraph 2 above shall be released by the City. In the event that the Site Development Plan for the Combined Project is not approved prior to July 1,2000, the City may cause Kelly to forfeit the seettfleicdeposit - and at the discretion of the City, the City may I record the Security Grant Deeds, or extend the deadline and require the developer to continue efforts to obtain approval of a Site Development Plan in the City’s sole discretion. 3. Inclusionarv Reauirements for Planning Areas A, D, G, H. I and J 3.1 Conveyance to PTR. In order to satisfy the Inclusionary Ordinance with respect to the balance of the entire Kelly Ranch Project, and subject to the terms and conditions set forth in the Purchase Agreement, Kelly shall convey the Security Property to PTR for development of the Combined Project. When the obligations set forth below have been satisfied with respect to the Combined Project, the Combined Project shall be deemed to satisfy the Inclusionary Ordinance and all inclusionary housing requirements for the remainder of the Kelly Ranch Project. 4. Terms Governing Provision of Affordable Units. 4.1 Number of Affordable Units. The Combined Project shall include up to four hundred ninety-five (495) rental housing units, a minimum of one hundred thirty-two (132) of which shall be rent-restricted and affordable to lower income households as required and defined by Chapter 21.85 of the Carlsbad Municipal Code (the “Affordable Units”), and as shown in “Exhibit B”. The requirement for one hundred thirty-two (132) Affordable Units is based on fifteen percent (15%) of eight hundred seventy-seven (877) aggregate dwelling units (including the Affordable Units) for the entire Kelly Ranch Project. The maximum number of dwelling units for the entire Kelly Ranch Project shall not exceed eight hundred seventy-seven (877). The maximum number of Market Units shall not exceed seven hundred forty-five (745). If the total number of housing units increases or decreases within the Kellv Ranch Proiect, the minimum number of affordable housing units shall increase or decrease accordingly, but shall never be less than 15% of the total number of housing units. This agreement shall be amended to reflect any changes to the total number of housing units and applicable affordable housing requirement. Amendments to this agreement to reflect changes in the total number of housing units and the minimum number of affordable units may be executed by the Community Development Director, subiect to the review and approval of the City Attorney. 4.2 Location of Affordable Units. The Combined Project shall be located in Planning Areas D, G and H. Specific Affordable Units within the Combined Project shall be distributed throughout the Combined Project, and shall be as provided as designated in an approved Site Development Plan. Modifications to the location and timing of the Affordable Units shall be subject to the prior written approval of the -Community Development, with a recommendation from the Housing and Redevelopment Director. I 4.3 Size and Bedroom Count. The Affordable Units in the Combined Project shall have the number of bedrooms and square footage as shown in “Exhibit C”. 4.4 Affordability Reauirements. The Affordable Units shall be available to households with incomes not exceeding 80% of the median income for San Diego County, adjusted for actual household size. Monthly Rents of the Affordable Units shall not exceed 1/12th of 30% of 80% of median income for San Diego County, adjusted for assumed household I 12 size appropriate for the unit. For purposes of this Agreement, “Rent” shall include a utility allowance as established and adopted by the City of Carlsbad Housing Authority , as well as all monthly payments made by the tenant to the lessor in connection with use and occupancy of a housing unit and land and facilities associated therewith, including and separately charged fees, utility charges, or service charges assessed by the lessor and payable by the tenant. Median income figures shall be those published annually by the United States Department of Housing and Urban Development. Assumed household size figures shall be provided to Developer upon request to the City of Carlsbad Housing and Redevelopment Department. With respect to each Affordable Unit, the affordability requirements of this Section 4.4 shall continue for fifty-five (55) years from the date of issuance of a Certificate of Occupancy by the City for such unit or another comparable unit based upon substitution provisions pursuant to the Regulatory Agreement. The affordability requirements of this Section 4.4 shall be set forth in the Regulatory Agreement between the Developer or its successor and the City, provided for in Section 5 below, which shall supersede this Agreement upon recordation of the Regulatory Agreement. 4.5 Schedule for Developing Affordable Units. 4.5.1 Prior to recordation of this agreement, Kelly shall provide the additional security as described in Section 2 of this Agreement. 4.5.2 Concurrent with the recordation of the first map for Kelly Ranch, this agreement shall be executed and recorded against the Kelly Ranch Project. 4.5.3 Prior to the Construction of any units within any Planning Area, other than Planning Area E, the developer of the Combined Project shall have received approval for a Site Development Plan for the Combined Project. The Site Development Plan shall designate the location, size and phasing of construction of the Affordable Units. 4.5.4 The Affordable Units shall be developed in accordance with the approved Site Development Plan for the Combined Project and as more fully detailed in Exhibit B of this agreement. The release of building permits for all units within the Kelly Ranch Project shall be in accordance with Exhibit B of this Agreement. Subject to tentative receipt of all necessary City and other public agency approvals, PTR intends to complete the Combined Project by Jikembe October -3 1,2001Q. - 4.5.5 The first 22 units completed within the Combined Project shall be designated Affordable Units to satisfy the a”e inclusionan housing requirement of Vd-laga Planning Area E. 5. City Approval of Documents The following documents, in form and substance acceptable to the City, shall be used in connection with the rental of Affordable Units. Such documents shall be prepared by the PTR and shall be submitted to the Housing and I3 Redevelopment Director for review and approval no later than the start of construction of the Affordable Units. 5.1 A marketing plan consistent with the terms of this Agreement, establishing the process for seeking, selecting and determining the eligibility of tenants of the Affordable Units. 5.2 Form of Rental Agreement. 5.3 A Property Management Plan. 5.4 A Form of Regulatory Agreement between PTR and City (the "Regulatory Agreement"), following the format designated by City and provided to PTR. 5.5 Any of the documents identified in section 5 may be revised by PTR from time to time with the prior written approval of the Housing and Redevelopment Director. 6. Reauest for Bond Issuance Particiuation Upon receipt of a written request from PTR, the City may consider to make all necessary applications for the issuance of revenue bonds pursuant to Health and Safety Code Section 52075, a. % 7. Rental Terms. The Affordable Units shall be rent-restricted as described in "Exhibit D' for a period of fifty-five (55) years commencing on the date the certificate of occupancy is issued for the first Affordable Unit. The Schedule of Maximum Eligible Tenant Incomes and Affordable Rents (the "Schedule") attached hereto and incorporated herein as "Exhibit D" sets forth the City's requirements for maximum household income of Tenants of the Affordable Units ("Eligible Tenants") and the methodology for calculation of the rents of Affordable Units which will be affordable to each of the Eligible Tenants (the "Affordable Rents"). The Affordable Rents will vary depending on the number of bedrooms in the Affordable Unit, and the applicable information from "Exhibit D' as the same varies from time to time. The Schedule also includes initial estimates of Eligible Tenant actual incomes and the corresponding Affordable Rents. The final Schedule shall be established prior to lease up based on the San Diego County Area Median Income and the cost factors applicable at the time. The final Schedule shall be submitted by PTR and approved by the City's Housing and Redevelopment Director. 8. Reporting and Compliance Monitoring. PTR shall submit an annual report to the City as required under the Regulatory Agreement, identifying which units are Affordable Units, the monthly rent, vacancy information for each Affordable Unit, and monthly income of the tenants of each Affordable Unit for the prior year, together with such other information as reasonably required by the City to verify compliance with this Agreement. 9. Release of Subiect Prouertv From Agreement. The covenants and conditions herein contained shall apply to and bind the heirs, executors, administrators, successors, transferees and assignees of all the parties having or acquiring any right, title or interest in or to any part of the c Subject Property, and shall run with and burden the Subject Property, excluding Planning Area E- until terminated in accordance with the provisions hereof. Prior to the issuance of building permits, Developer shall expressly make the conditions and covenants contained in this Agreement a part of any deed or other instrument conveying any interest in the Subject Properly, excluding Planning Area E. Notwithstanding anything to the contrary set forth in this Agreement, individual purchasers of single-family units pursuant to an approved public report in compliance with the California Subdivided Lands Act, and mortgage lenders holding deeds of trust on such individual units after sale to such purchasers, shall not be subject to the terms of this Agreement; and the terms of this Agreement shall be of no further force or effect with respect to such completed unit on the date of the recordation of a deed to the individual purchaser. Upon final inspection and issuance of a certificate of occupancy for 132 Affordable Units, all Planning Areas, with the exception of Planning Areas D, G and H, shall be released from the burdens of this Agreement. The burdens of this agreement shall remain in full force and effect and recorded against Planning Areas D, G and H for the 55 year duration of this agreement. 10 Default. Failure of Kelly or PTR to cure any default in either Kelly's or PTRs obligations under the terms of this Agreement within ninety (90) days after the delivery of a notice of default from the City (or where the default is of the nature which cannot be cured within such ninety (90) day period, the failure of Kelly or PTR to commence to cure such default within the ninety (90) day period or Kelly's or PTR's failure to proceed diligently to complete the cure of such a default within 180 days) will constitute a breach of the Agreement and the requirements of the Carlsbad Municipal Code chapter 21.85 and the City may exercise any and all remedies available to it with respect to Kelly's and PTRs failure to satisfy the Conditions of Approval and chapter 21. 85 of the Carlsbad Municipal Code, including, but not limited to, the withholding of building permits for the market rate units within Kelly Ranch.. 1 1. Auuointment of Other Agencies. At its sole discretion, the City may designate, appoint or contract with any other public agency, for-profit or non-profit organization to perform the City's obligations under this Agreement. 12. Hold Harmless. Kelly and PTR will each indemnify and hold harmless (without limit as to amount) the City and its elected officials, officers, employees and agents in their official capacity (hereinafter collectively referred to as "Indemnitees"), and any of them, from and against all loss, all risk of loss and all damage (including expense) sustained or incurred because of or by reason of any and all claims, demands, suits, actions, judgments and executions for damages of any and every kind and by whomever and whenever made or obtained, allegedly caused by, arising out of or relating to PTRs construction of the Combined Project, and shall protect and defend Indemnitees, and any of them with respect thereto; provided, however, that this section shall not be applicable to matters involving any gross negligence or willful misconduct on the part of any Indemnitee. The foregoing obligation shall be covered by appropriate insurance policies for the Combined Project naming Indemnitees as additional named insureds with aggregate limits of not less than five million dollars ($5,000,000) purchased by PTR at its sole expense from an insurance company duly licensed to engage in the business of issuing such insurance in the State, with a current Best's Key Rating of not less than A-V, such insurance to be evidenced by an endorsement which so provides and delivered to the City Clerk prior to the issuance of the first building permit for the Combined Project. 14 Notices. All notices required pursuant to this Agreement shall be in writing and may be given by personal delivery or by registered or certified mail, return receipt requested, to the party to receive such notice at the addresses set forth below: TO THE CITY OF CARLSBAD: CITY OF CARLSBAD Housing and Redevelopment Department Attn: Housing and Redevelopment Director 2965 Roosevelt Street, Suite B Carlsbad, California 92008-2389 TO KELLY: Kelly Land Company Attn: D. L. Clemens c/o Hillman Properties West, Inc. 201 1 Palomar Airport Road, Suite 206 Carlsbad, California 92008 with copies to: Sheppard, Mullin, Richter & Hampton LLP Attn: Christopher B. Neils, Esquire 501 West Broadway, 19th Floor San Diego, California 92101-3598 PTR DEVELOPMENT SERVICES INCORPORATED Attn: Kevin M. Hampton, Vice President 25B Technology Drive, Suite 210 Irvine, California 9261 8 Security Capital Pacific Trust Attn: Pam Porter 7670 South Chester Street Englewood, CO 80112 Mayer, Brown & Platt Attn: Mark Mears, Esquire 190 South La Salle Street Chicago, Illinois 60603-3441 Any party may change the address to which notices are to be sent by notifying the other parties of the new address, in the manner set forth above. Such notice shall be deemed effective upon delivery, if personally delivered, two (2) business days after mailing in accordance with the requirements set forth above. 15. Integrated Agreement. This Agreement constitutes the entire Agreement between the parties and no modification hereof shall be binding unless reduced to writing and signed by the parties hereto. 16. Duration of Agreement; Effect on PTR. This Agreement shall terminate upon the earlier of 55 years from the date of this Agreement and/or the granting of a written release by the Community Development Director. This Agreement, and any section, subsection, or covenant contained herein, may be amended only upon the written consent of Kelly, PTR and the Community Development Director. 17. Permitted Delavs. Performance by any party of its obligations under this Agreement shall be excused during any period of delay caused at any time by reason of acts of God or civil commotion, riots, strikes, picketing or other labor disputes, shortage of materials or supplies, damage to work in progress by reason of fire, floods, earthquake or other casualty, restrictions imposed or mandated by governmental or quasi-governmental entities, enactment of conflicting laws, litigation, acts or neglect of the other parties, or any other cause beyond the reasonable control of a party, but not including failure to obtain financing. Each party shall promptly notify the other parties of any delay hereunder as soon as possible after the same has been ascertained. The term of this Agreement and the time deadlines for such performance shall be extended by the period of any such delay. 18. Right to Transfer. Kelly shall have the right to sell, mortgage, hypothecate, assign or transfer ("Transfer") the Kelly Ranch Project in whole or in part to any person, partnership, joint venture, firm or corporation including, without limitation, PTR ("Transferee") at any time during the term of this Agreement. Kelly and PTR shall also have the right to Transfer their respective rights under this Agreement as they pertain to the Combined Project, the Kelly Ranch Project, or any portion thereof. It is understood and agreed by the parties that portions of the Kelly Ranch Project may be subdivided after the date of this Agreement. One or more of such subdivided parcels may be Transferred to persons for development by them in reliance upon the provisions of this Agreement. The obligations of Kelly and any such Transferees are several and not joint. 19. Recording of Agreement. The parties hereto shall cause this Agreement to be recorded against the Kelly Ranch Project, which is the burdened land and the benefitted land, in the official Records of the County of San Diego. -940 - - - 20. Severability. In the event any limitation, condition, restriction, covenant, or provision contained in this Agreement is to be held invalid, void or unenforceable by any court of competent jurisdiction, the remaining portions of this Agreement shall nevertheless, be and remain in full force and effect. -1043 - - - IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the day and year first above written. KELLY: CITY: KELLY LAND COMPANY, CITY OF CARLSBAD, a Delaware A Municipal Corporation corporation BY BY Martin Orenyak Its Community Development Director PTR: APPROVED AS TO FORM PTR DEVELOPMENT SERVICES INCORPORATED, a Delaware corporation RONALD R. BALL City Attorney BY Its “EXHIBIT B” KELLY RANCH - BUILDING PERMIT PHASING PLAN KELLY RAN Action Required/ Phasing leceive Approval of Affordable Jsg. Agreement by City Council & wovide agreed upon security for 22 tffordable housing units for Village - >. site Development Plan approved by :ity Council for Affordable {ousing Project (132 units). tillages D, G & H must be graded. n addition, one or more signs must )e installed on the site, which are tcceptahle to the City, to identify he future apartment project. ill building permits issued and 'oundations complete, inspected md approved for 132 apartment mits. 'inal Certificate of Occupancy nust be issued for at least 132 .ental units and rent restricted at the CI Exhibit B I - BUILDING PERMIT PHASING PLAN # of Building Permits & Type Released 144 market rate building permits 110 market rate building permits (SF and/or MF) and 132 e#tAtMe building permits within mixed income MPF project. At leist 27% of the MF proiect must be affordable units. - and Building Permits for clubhouse in MF project 346 - building permits within mixed ncome MF proiect must be affordable units. - 145 market rate % of Total Permits for Proiect 16% 13% and 15% 40% 17% Comments Allowed to proceed without formally approved Site Development Plan for affordable project. SDP, however, must be deemed supportable by Staff. At this point, the total market rate permits allowed to be issued would be 254 or 29% of the total number of units projected; these permits can be used to construct single family or multi-family units a{ the discretion of the developer/ builder. The total # of building permits for housing, units). At this point, there could be a total of 600 market rate units represents 68% of of units w/in the These units will be a combination of family rental project is a mixed income (495 units) project which includes 132 affordable units. The fwse132 rental mils must be designated for affordable housing purposes. Thode need affordable rates. building permits -16-l-6 - - - not be the first 132 uniis. As I 22 EXHIBIT 5 RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: City of Carlsbad City Clerk's Office Attn: City Clerk 1200 Carlsbad Village Drive Carlsbad, California 92008 ABOVE SPACE FOR RECORDER'S USE AFFORDABLE HOUSING AGREEMENT IMPOSING RESTRICTIONS ON REAL PROPERTY This AFFORDABLE HOUSING AGREEMENT IMPOSING RESTRICTIONS ON REAL PROPERTY ("Agreement"), entered into this day of , 1998 (the "Effective Date"), by and between the CITY OF CARLSBAD, a Municipal Corporation (hereinafter referred to as the "City"), KELLY LAND COMPANY, a Delaware corporation (hereinafter referred to as "Kelly"), and PTR DEVELOPMENT SERVICES INCORPORATED, a Delaware corporation (which is affiliated with Security Capital Pacific Trust, a Maryland real estate investment trust) (hereinafter referred to as "PTR"), is made with reference to the following: A. Kelly is the record owner of certain real properly located in the City of Carlsbad, California (the "Kelly Ranch") described in "Exhibit A," which is attached hereto and incorporated herein by this reference. The Kelly Ranch consists of several planning areas, also designated in "Exhibit A," As used herein, the term "Planning Area" shall refer, as indicated, to one or more of such planning areas so designated on "Exhibit A," The various Planning Areas as shown on "Exhibit A" either are, or will become, separate legal parcels in accordance with the applicable legal requirements of the State of California and the City. B. Upon their creation as separate legal parcels, Kelly intends to convey or cause conveyance of record title to Planning Areas K and L, respectively, to other persons pursuant to contractual commitments not related to this Agreement. Any further development activity with respect to either Planning Area K or Planning Area L will be the responsibility of the respective transferee. All of the Planning Areas of the Kelly Ranch, other than Planning Areas K and L, are herein referred to collectively as the "Kelly Ranch Project." Kelly is the developer of the Kelly Ranch Project. C. The parties anticipate that the total number of dwelling units for the Kelly Ranch Project will not exceed eight hundred seventy-seven (877). In order to satisfy the affordable housing requirements for the entire Kelly Ranch Project, it is the intent of the parties that a combined inclusionary project (the "Combined Project") be developed on I 23 Planning Areas D, G and H, for the development of Affordable Units (as hereinafter defined) in relation to unrestricted units ("Market Units") in the Kelly Ranch Project (including the Combined Project) according to the chart set forth in "Exhibit B" . The parties acknowledge that the Affordable Units in the Combined Project will satisfy the inclusionary housing requirements for the Kelly Ranch Project, so long as the aggregate number of dwelling units does not exceed eight hundred seventy-seven (877) for the Kelly Ranch Project. D. Kelly has filed a separate application for tentative subdivision map and site plan with respect to Planning Area E. As of the Effective Date, Planning Area E is the subject of certain development approvals received from the City including without limitation: the Tentative Subdivision Map (C.T. 96-07), Planned Unit Development Permit (PUD 97-04), Hillside Development Permit (HDP 96-13) and Coastal Development Permit (CDP 96-13), approved by Resolution No. 96-68, adopted by the City on April 7,1998. and a G, H, E. Kelly has filed a separate application for a General Plan Amendment, rezoning master tentative map (the "Master Tentative Map") with respect to Planning Areas D, F, I and J, as well as K and L. Planning Areas K and L are being processed merely to create them as legal parcels, with the Master Tentative Map intended to note that further mapping of parcels K and L, respectively, will be required prior to any development of them. Kelly has also filed a proposed amendment to the Zone 8 Local Facilities Management Plan. In addition, Kelly and PTR have filed or intend to file a separate application for approval of a site development plan with respect to Planning Area J, a planned development permit with respect to Planning Area I and a site development plan for Planning Areas D, G and H. F. Kelly and PTR have entered into that certain Purchase Agreement dated , 1998 (the "Purchase Agreement"), whereby Kelly has agreed to sell Planning Areas D, G, H, I and J to PTR subject to the terms and conditions set forth therein. Among other things, said terms require that PTR take Title to all the Master Tentative Map land, but that concurrently with recordation of the final map for such land (i) PTR will Deed Planning Area F to Kelly, and (ii) PTR will Deed Planning Areas K and L to the Kelly Family Trust and to Wayne Callaghan, respectively. G. It is anticipated that the Combined Project will be developed by PTR within Planning Areas D, G and H (the "Security Property"). H. The City issued an approval for Planning Area E subject to certain conditions of approval, including a requirement that Kelly enter into an Affordable Housing Agreement in which Kelly causes to be provided at least twenty-two (22) units affordable to low income households (the "Planning Area E Inclusionary Requirement"). NOW, THEREFORE, in consideration of the mutual covenants and promises of the parties herein contained, it is mutually agreed by and between the undersigned parties as follows: .- 1. Satisfaction of Affordable Housing Obligation and Conditions of Approval. In order to satisfy the Conditions of Approval for CT 96-07 and the requirements of the City’s Inclusionary Housing Ordinance, Carlsbad Municipal Code Chapter 21.85, the developers of Kelly Ranch shall provide a minimum of one hundred thirty-two (1 32) units which shall be restricted and affordable to lower income households according to the schedule and terms contained herein. This Agreement is an Affordable Housing Agreement pursuant to Section 21.85.030(b)(5) of Chapter 21.85 of the Carlsbad Municipal Code. Developer shall submit this Agreement to the City and this Agreement shall be recorded concurrently with the recordation of the final map for Planning Area E. 2. Inclusionarv Reauirements for Planning Area E. Prior to the recordation of the Affordable Housing Agreement, Kelly has voluntarily agreed to provide additional security to insure the construction of the Affordable Units required for Planning Area E. The additional security will include (1) a cash deposit or letter of credit in the amount of $220,000, (2) The recordation of a deed restriction, in a form acceptable to the City of Carlsbad, upon Planning Areas D, G and H which will limit development to that which can satisfy the affordable housing requirement for the Kelly Ranch Project, and (3) executed and acknowledged grant deeds from Kelly and PTR to the City for Planning Areas D, G, and H, sufficient to convey title to the City (the “Security Grant Deeds”). The City shall hold the Security Grant Deeds as additional Security for the Developer’s construction of the Affordable Units required for Planning Area E and shall not accept the grant deeds or record them in the Official Records of the County of San Diego unless it so elects in the event the Developer fails to obtain Site Development Plan approval for the Combined Project prior to June 1,2000, as required pursuant to Section 2.1 below. The acceptance and recordation of the Security Grant Deeds shall be solely at the discretion of the City. The additional security is not an In-Lieu contribution as defined by Chapter 21.85 of the Carlsbad Municipal Code. Subsequent to the recordation of this Agreement, the developer of Planning Area E shall be entitled to construct up to a maximum of one hundred forty-five (145) Market Units. 2.1 Satisfaction of the Inclusionarv Requirements for Planning Area E Upon City approval of a Site Development Plan for the Combined Project, as defined in Section 4.1 below, City inspection and final approval of the grading of Planning Areas D, G and H, and the installation by Kelly of one or more signs on the subject property acceptable to the City identifying the future apartment project to the satisfaction of the City, the additional security obligations described in paragraph 2 above shall be released by the City. In the event that the Site Development Plan for the Combined Project is not approved prior to July 1,2000, the City may cause Kelly to forfeit the cash deposit and at the discretion of the City, the City may record the Security Grant Deeds, or extend the deadline and require the developer to continue efforts to obtain approval of a Site Development Plan in the City’s sole discretion. -33 - - - I 25 3. Inclusionarv Reauirements for Planning Areas A, D, G, H. I and J 3.1 Conveyance to PTR. In order to satisfy the Inclusionary Ordinance with respect to the balance of the entire Kelly Ranch Project, and subject to the terms and conditions set forth in the Purchase Agreement, Kelly shall convey the Security Property to PTR for development of the Combined Project. When the obligations set forth below have been satisfied with respect to the Combined Project, the Combined Project shall be deemed to satisfy the Inclusionary Ordinance and all inclusionaq housing requirements for the remainder of the Kelly Ranch Project. 4. Terms Governing Provision of Affordable Units. 4.1 Number of Affordable Units. The Combined Project shall include up to four hundred ninety-five (495) rental housing units, a minimum of one hundred thirty-two (132) of which shall be rent-restricted and affordable to lower income households as required and defined by Chapter 21.85 of the Carlsbad Municipal Code (the “Affordable Units”), and as shown in “Exhibit B”. The requirement for one hundred thirty-two (1 32) Affordable Units is based on fifteen percent (1 5%) of eight hundred seventy-seven (877) aggregate dwelling units (including the Affordable Units) for the entire Kelly Ranch Project. The maximum number of dwelling units for the entire Kelly Ranch Project shall not exceed eight hundred seventy-seven (877). The maximum number of Market Units shall not exceed seven hundred forty-five (745). If the total number of housing units increases or decreases within the Kelly Ranch Project, the minimum number of affordable housing units shall increase or decrease accordingly, but shall never be less than 15% of the total number of housing units. This agreement shall be amended to reflect any changes to the total number of housing units and applicable affordable housing requirement. Amendments to this agreement to reflect changes in the total number of housing units and the minimum number of affordable units may be executed by the Community Development Director, subject to the review and approval of the City Attorney. 4.2 Location of Affordable Units. The Combined Project shall be located in Planning Areas D, G and H. Specific Affordable Units within the Combined Project shall be distributed throughout the Combined Project, and shall be as provided as designated in an approved Site Development Plan. Modifications to the location and timing of the Affordable Units shall be subject to the prior written approval of the Community Development, with a recommendation from the Housing and Redevelopment Director. 4.3 Size and Bedroom Count. The Affordable Units in the Combined Project shall have the number of bedrooms and square footage as shown in “Exhibit C”. 4.4 Affordability Reauirements. The Affordable Units shall be available to households with incomes not exceeding 80% of the median income for San Diego County, adjusted for actual household size. Monthly Rents of the Affordable Units shall not exceed 1/12th of 30% of 80% of median income for San Diego County, adjusted for assumed household size appropriate for the unit. For purposes of this Agreement, “Rent” shall include a utility allowance as established and adopted by the City of Carlsbad Housing Authority, as well as all monthly payments made by the tenant to the lessor in connection with use and occupancy of a housing unit and land and facilities associated therewith, including and separately charged fees, utility charges, or service charges assessed by the lessor and payable by the tenant. Median income figures shall be those published annually by the United States Department of Housing and Urban Development. Assumed household size figures shall be provided to Developer upon request to the City of Carlsbad Housing and Redevelopment Department. With respect to each Affordable Unit, the affordability requirements of this Section 4.4 shall continue for fifty-five (55) years from the date of issuance of a Certificate of Occupancy by the City for such unit or another comparable unit based upon substitution provisions pursuant to the Regulatory Agreement. The affordability requirements of this Section 4.4 shall be set forth in the Regulatory Agreement between the Developer or its successor and the City, provided for in Section 5 below, which shall supersede this Agreement upon recordation of the Regulatory Agreement. 4.5 Schedule for Develouing Affordable Units. 4.5.1 Prior to recordation of this agreement, Kelly shall provide the additional security as described in Section 2 of this Agreement. 4.5.2 Concurrent with the recordation of the first map for Kelly Ranch, this agreement shall be executed and recorded against the Kelly Ranch Project. 4.5.3 Prior to the Construction of any units within any Planning Area, other than Planning Area E, the developer of the Combined Project shall have received approval for a Site Development Plan for the Combined Project. The Site Development Plan shall designate the location, size and phasing of construction of the Affordable Units. 4.5.4 The Affordable Units shall be developed in accordance with the approved Site Development Plan for the Combined Project and as more fully detailed in Exhibit B of this agreement. The release of building permits for all units within the Kelly Ranch Project shall be in accordance with Exhibit B of this Agreement. Subject to tentative receipt of all necessary City and other public agency approvals, PTR intends to complete the Combined Project by October 31,2001. 4.5.5 The first 22 units completed within the Combined Project shall be designated Affordable Units to satisfy the inclusionary housing requirement of Planning Area E. 5. Citv Approval of Documents The following documents, in form and substance acceptable to the City, shall be used in connection with the rental of Affordable Units. Such documents shall be prepared by the PTR and shall be submitted to the Housing and -53 - - - 21 Redevelopment Director for review and approval no later than the start of construction of the Affordable Units. 5.1 A marketing plan consistent with the terms of this Agreement, establishing the process for seeking, selecting and determining the eligibility of tenants of the Affordable Units, 5.2 Form of Rental Agreement. 5.3 A Property Management Plan. 5.4 A Form of Regulatory Agreement between PTR and City (the "Regulatory Agreement"), following the format designated by City and provided to PTR. 5.5 Any of the documents identified in section 5 may be revised by PTR from time to time with the prior written approval of the Housing and Redevelopment Director. 6. Reauest for Bond Issuance Particiuation Upon receipt of a written request from PTR, the City may consider to make all necessary applications for the issuance of revenue bonds pursuant to Health and Safety Code Section 52075, a. && 7. Rental Terms. The Affordable Units shall be rent-restricted as described in "Exhibit D for a period of fifty-five (55) years commencing on the date the certificate of occupancy is issued for the first Affordable Unit. The Schedule of Maximum Eligible Tenant Incomes and Affordable Rents (the "Schedule") attached hereto and incorporated herein as "Exhibit D" sets forth the City's requirements for maximum household income of Tenants of the Affordable Units ("Eligible Tenants") and the methodology for calculation of the rents of Affordable Units which will be affordable to each of the Eligible Tenants (the "Affordable Rents"). The Affordable Rents will vary depending on the number of bedrooms in the Affordable Unit, and the applicable information from "Exhibit D as the same varies from time to time. The Schedule also includes initial estimates of Eligible Tenant actual incomes and the corresponding Affordable Rents. The final Schedule shall be established prior to lease up based on the San Diego County Area Median Income and the cost factors applicable at the time. The final Schedule shall be submitted by PTR and approved by the City's Housing and Redevelopment Director. 8. p. PTR shall submit an annual report to the City as required under the Regulatory Agreement, identifying which units are Affordable Units, the monthly rent, vacancy information for each Affordable Unit, and monthly income of the tenants of each Affordable Unit for the prior year, together with such other information as reasonably required by the City to verify compliance with this Agreement. 9. Release of Subiect Prouertv From Agreement. The covenants and conditions herein contained shall apply to and bind the heirs, executors, administrators, successors, transferees and assignees of all the parties having or acquiring any right, title or interest in or to any part of the -63 - - - Subject Property, and shall run with and burden the Subject Property, excluding Planning Area E, until terminated in accordance with the provisions hereof. Prior to the issuance of building permits, Developer shall expressly make the conditions and covenants contained in this Agreement a part of any deed or other instrument conveying any interest in the Subject Property, excluding Planning Area E. Notwithstanding anything to the contrary set forth in this Agreement, individual purchasers of single-family units pursuant to an approved public report in compliance with the California Subdivided Lands Act, and mortgage lenders holding deeds of trust on such individual units after sale to such purchasers, shall not be subject to the terms of this Agreement; and the terms of this Agreement shall be of no further force or effect with respect to such completed unit on the date of the recordation of a deed to the individual purchaser. Upon final inspection and issuance of a certificate of occupancy for 132 Affordable Units, all Planning Areas, with the exception of Planning Areas D, G and H, shall be released from the burdens of this Agreement. The burdens of this agreement shall remain in full force and effect and recorded against Planning Areas D, G and H for the 55 year duration of this agreement. 10 Default. Failure of Kelly or PTR to cure any default in either Kelly's or PTR's obligations under the terms of this Agreement within ninety (90) days after the delivery of a notice of default from the City (or where the default is of the nature which cannot be cured within such ninety (90) day period, the failure of Kelly or PTR to commence to cure such default within the ninety (90) day period or Kelly's or PTR's failure to proceed diligently to complete the cure of such a default within 180 days) will constitute a breach of the Agreement and the requirements of the Carlsbad Municipal Code chapter 21.85 and the City may exercise any and all remedies available to it with respect to Kelly's and PTR's failure to satisfy the Conditions of Approval and chapter 21. 85 of the Carlsbad Municipal Code, including, but not limited to, the withholding of building permits for the market rate units within Kelly Ranch.. 11. Auuointment of Other Agencies. At its sole discretion, the City may designate, appoint or contract with any other public agency, for-profit or non-profit organization to perform the City's obligations under this Agreement. 12. Hold Harmless. Kelly and PTR will each indemnify and hold harmless (without limit as to amount) the City and its elected officials, officers, employees and agents in their official capacity (hereinafter collectively referred to as "Indemnitees"), and any of them, from and against all loss, all risk of loss and all damage (including expense) sustained or incurred because of or by reason of any and all claims, demands, suits, actions, judgments and executions for damages of any and every kind and by whomever and whenever made or obtained, allegedly caused by, arising out of or relating to PTR's construction of the Combined Project, and shall protect and defend Indemnitees, and any of them with respect thereto; provided, however, that this section shall not be applicable to matters involving any gross negligence or willful misconduct on the part of any Indemnitee. The foregoing obligation shall be covered by appropriate insurance policies for the Combined Project naming Indemnitees as additional named insureds with aggregate limits of not -73 - - - less than five million dollars ($5,000,000) purchased by PTR at its sole expense from an insurance company duly licensed to engage in the business of issuing such insurance in the State, with a current Best's Key Rating of not less than A-V, such insurance to be evidenced by an endorsement which so provides and delivered to the City Clerk prior to the issuance of the first building permit for the Combined Project. 14 Notices. All notices required pursuant to this Agreement shall be in writing and may be given by personal delivery or by registered or certified mail, return receipt requested, to the party to receive such notice at the addresses set forth below: TO THE CITY OF CARLSBAD: CITY OF CARLSBAD Housing and Redevelopment Department Attn: Housing and Redevelopment Director 2965 Roosevelt Street, Suite B Carlsbad, California 92008-2389 TO KELLY: Kelly Land Company Attn: D. L. Clemens c/o Hillman Properties West, Inc. 201 1 Palomar Airport Road, Suite 206 Carlsbad, California 92008 with copies to: Sheppard, Mullin, Richter & Hampton LLP Attn: Christopher B. Neils, Esquire 501 West Broadway, 19th Floor San Diego, California 92101-3598 PTR DEVELOPMENT SERVICES INCORPORATED Attn: Kevin M. Hampton, Vice President 25B Technology Drive, Suite 210 Irvine, California 92618 Security Capital Pacific Trust Attn: Pam Porter 7670 South Chester Street Englewood, CO 801 12 Mayer, Brown & Platt Attn: Mark Mears, Esquire -83 - - - 190 South La Salle Street Chicago, Illinois 60603-3441 Any party may change the address to which notices are to be sent by notifying the other parties of the new address, in the manner set forth above. Such notice shall be deemed effective upon delivery, if personally delivered, two (2) business days after mailing in accordance with the requirements set forth above. 15. Integrated Agreement. This Agreement constitutes the entire Agreement between the parties and no modification hereof shall be binding unless reduced to writing and signed by the parties hereto. 16. Duration of Agreement: Effect on PTR. This Agreement shall terminate upon the earlier of 55 years from the date of this Agreement andor the granting of a written release by the Community Development Director. This Agreement, and any section, subsection, or covenant contained herein, may be amended only upon the written consent of Kelly, PTR and the Community Development Director. 17. Permitted Delays. Performance by any party of its obligations under this Agreement shall be excused during any period of delay caused at any time by reason of acts of God or civil commotion, riots, strikes, picketing or other labor disputes, shortage of materials or supplies, damage to work in progress by reason of fire, floods, earthquake or other casualty, restrictions imposed or mandated by governmental or quasi-governmental entities, enactment of conflicting laws, litigation, acts or neglect of the other parties, or any other cause beyond the reasonable control of a party, but not including failure to obtain financing. Each party shall promptly notify the other parties of any delay hereunder as soon as possible after the same has been ascertained. The term of this Agreement and the time deadlines for such performance shall be extended by the period of any such delay. 18. Right to Transfer. Kelly shall have the right to sell, mortgage, hypothecate, assign or transfer ("Transfer") the Kelly Ranch Project in whole or in part to any person, partnership, joint venture, firm or corporation including, without limitation, PTR ("Transferee") at any time during the term of this Agreement. Kelly and PTR shall also have the right to Transfer their respective rights under this Agreement as they pertain to the Combined Project, the Kelly Ranch Project, or any portion thereof. It is understood and agreed by the parties that portions of the Kelly Ranch Project may be subdivided after the date of this Agreement. One or more of such subdivided parcels may be Transferred to persons for development by them in reliance upon the provisions of this Agreement. The obligations of Kelly and any such Transferees are several and not joint. 19. Recordine of Agreement. The parties hereto shall cause this Agreement to be recorded against the Kelly Ranch Project, which is the burdened land and the benefitted land, in the official Records of the County of San Diego. -93 - - - 20. Severability. In the event any limitation, condition, restriction, covenant, or provision contained in this Agreement is to be held invalid, void or unenforceable by any court of competent jurisdiction, the remaining portions of this Agreement shall nevertheless, be and remain in full force and effect. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the day and year first above written. KELLY CITY: KELLY LAND COMPANY, CITY OF CARLSBAD, a Delaware A Municipal Corporation corporation BY BY Martin Orenyak Its Community Development Director PTR: APPROVED AS TO FORM PTR DEVELOPMENT SERVICES INCORPORATED, a Delaware corporation RONALD R. BALL City Attorney BY Its -103 - - - I 32- STATE OF CALIFORNIA 1 COUNTY OF ) ss. 1 On , 199-, before me, , personally appeared and , personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) idare subscribed to the within instrument and acknowledged to me that he/she/they executed the same in hisker/their authorized capacity(ies), and that by hishedtheir signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. WITNESS my hand and official seal. Notary Public in and for said State (SEAL) STATE OF CALIFORNIA ) COUNTY OF ) ss. ) On , 199-, before me, , personally appeared and , personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) idare subscribed to the within instrument and acknowledged to me that he/she/they executed the same in hishedtheir authorized capacity(ies), and that by hisher/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. WITNESS my hand and official seal. Notary Public in and for said State (SEAL) -1 - 118 - - I 33 “EXHIBIT A” DESCRIPTION OF KELLY RANCH -1244 - - - I 34’ "EXHIBIT B" KELLY RANCH - BUILDING PERMIT PHASING PLAN I 35 Exhibit B KELLY RAR Action Requiredl Phasing teceive Approval of Affordable Hsg. igreement by City Council & xovide agreed upon security for 22 Lffordable housing units for Village >. Site Development Plan approved by 3ty Council for Affordable Housing 'roject (132 units). Villages D, G & 3 must be graded. In addition, one or nore signs must be installed on the :ite, which are acceptable to the City, o identify the future apartment xoject. ill building permits issued and bundations complete, inspected and lpproved for 132 apartment units. 3nal Certificate of Occupancy must )e issued for at least 132 rental units md rent restricted at the affordable 'ates. Permits & Type Released 144 narket rate building permits 110 market rate building permits (SF and/or MF) and 132 building permits within mixed At least 27% of the ncome MF project, MF oroiect must be affordable units. and Building Permits for clubhouse in MF project 346 building permits within mixed income MF project must be affordable units. 145 market rate building permits Permits for Project 16% 13% and 15% 40% 17% LAN Comments Allowed to proceed without formally approved Site Development Plan for affordable project. SDP, however, must be deemed supportable by Staff. At this point, the total market rate permits allowed to be issued would be 254 or 29% of the total number of units projected; these permits can be used to construct single family or multi-family units at the builder. The total # of building discretion of the developer1 the affordable, would be 386 or permits for housing, including 44% of the total # of housing units projected (877 units). At this point, there could be a total of 600 market rate units under construction which represents 68% of the total # of units w/in the project. These units will be a combination of single family and multi-family. The multi-family rental project is a mixed income (495 units) project which includes 132 affordable units. The 132 rental units must be designated for affordable housing purposes. Those need not be the first 132 units. "EXHIBIT C" AFFORDABLE UNITS SIZE AND BEDROOM COUNT I 31 "EXHIBIT D" SCHEDULE OF MAXIMUM ELIGIBLE TENANT INCOMES AND AFFORDABLE RENTS [ATTACH CITY SCHEDULE] -174-8 - - - I 30 Rxhibit 6 @ DATE: SUBJECT: JULY 9,1998 SDP 98-4 KELLY RANCH AFFORDABLE HOUSING PROJECT - REQUEST FOR RECOMMENDATION OF APPROVAL TO THE CITY COUNCIL OF AN AFFORDABLE HOUSING AGREEMENT FOR THE DEVELOPMENT OF 132 AFFORDABLE APARTMENT UNITS NECESSARY TO SATISFY THE INCLUSIONARY HOUSING REQUIFEMENT FOR THE KELLY RANCH DEVELOPMENT. I. RECOMMENDATION That the Housing Commission ADOPT Resolution No. 98-010, recommending APPROVAL to the City Council of an Affordable Housing Agreement for the development of 132 affordable apartment units in order to satisfy the requirements of the inclusionary housing requirement for the Kelly Ranch Development. 11. PROJECT BACKGROUND The Kelly Ranch Development is currently processing applications for the development of up to 877 housing units. For planning purposes, Kelly Ranch is divided into 12 Planning Areas (Planning Areas A-K). Planning Areas A, D, E, G, H, I and J are proposed for residential development and are the subject of this affordable housing agreement. Planning Areas B, C, F, L, and K are a combination of open space (B & C), future commercial development (F) or future residential development (L & K) and will be required to satisfy their respective inclusionary housing requirements at such time as they develop. Pursuant to the City's Inclusionary Housing Ordinance, 15% of the base dwelling units in the Development must be provided for lower income households. The Affordable Housing Agreement (Exhibit B) for Kelly Ranch establishes the phasing and development of the inclusionary housing for the Development pursuant to Chapter 21.85 of the City of Carlsbad Zoning Ordinance. Approval of a site development plan will be required to ensure consistency with the applicable affordable housing agreement and provides the inclusionary housing for the entire Development. SDP 98-4 - KELLY RANCH AFFORDABLE HOUSWG PROJECT JULY 9, 1998 Kelly Ranch will allow for the development of up to 877 residential units. Of the 877 units, there will be 382 single family homes and a 495 unit apartment project. All of the single family homes will be sold at "market rate." Planning Areas D, G and H will contain the 495 unit apartment project. The 132 affordable units will be dispersed throughout the apartment project. For purposes of the Affordable Housing Agreement, the apartment project is a Combined Affordable Housing Project as defined by Chapter 21.85 of the Carlsbad Municipal Code. The Combined Project will satisfy the affordable housing requirement for Planning Areas A, D, E, G, H, I, and J. Generally, when an affordable housing agreement is before the Commission, there will also be a recommendation for the corresponding Site Development Plan. In this particular instance, City staff has not completed its review of the proposed Site Development Plan. The Commission has been provided with the applicant's most recent application submittal. However, there are several issues related to site design, architecture, and density that are still to he resolved. It is very likely that the project will be revised at a later date. Therefore, the Site Development Plan will be returned to the Commission for future review and comment. 111. PROJECT DESCRIPTION A. Location The Kelly Ranch Apartment Project will be located at the northeast comer of the future intersection of Cannon Road and Faraday Road. The project is to be located on Lots 161-174, as shown on the proposed Tentative Map CT 97-16. B. Unit Mix The proposed apartment project consists of 363 market rate units and 132 affordable units. The affordable units will be dispersed throughout the apartment project. The affordable units will be a mixture of one, two and three bedrooms. A minimum of 14 of the three bedroom units will be restricted to affordable rent levels. The size of the apartment units are as follows: Bedroom Size Storage Area. ,' ' , Patio,Area, Living Area , Square Footage ,, Square Footage ~ ' Squaik Footage ., , ,, . ., ,. 1 Bedroom 6- 140 0-73 580-767 2 Bedroom 20 50 1340 3 Bedroom 7-103 0-1 15 984-11254 SDP 98-4 - KELLY RANCH AFFORDABLE HOUSING PROJECT JULY 9, 1998 PAGE 3 C. Other Features and Amenities IV. V. VI. The project will feature a 5,400 square foot recreation building, two swimming pools a tennis court and 1024 parking spaces. In addition, each individual unit will include a washer and dryer located on the patio or balcony area. DEVELOPMENT TEAM The affordable housing developer is Security Capital Pacific Trust. The developer is a real estate investment trust that develops and manages apartment projects throughout the Western United States. The developer has recently purchased several properties within the City of Carlsbad which they now manage. SITE A. Site Control The site is currently owned by Kelly Land Company. With the recordation of the final map for the project, Kelly Land Company will sell the different planning areas to various builders and developers. It is anticipated that Shea Homes will develop Planning Areas E and J, while Security Capital will develop Planning Areas D, G, H and I. C. Site Characteristics The affordable units will be located within Planning Areas D, G and H in the Kelly Ranch Development. The subject property is vacant and is bordered by Agua Hedionda Lagoon to the north, mobile homes to the east, residential development to the south and the Carlsbad Ranch Master Plan to the west. As part of the Kelly Ranch Development, Cannon Road will be extended from its current termination east of Interstate 5 to El Camino Real. Faraday Road will also be constructed as part of this development. AFFORDABILITY A. Rent and Income Levels The 132 affordable units will be restricted and affordable to households with incomes not exceeding 80% of the area median (AMI). Security Capital is seeking to finance the project in part through the use of private placement bonds. SDP 98-4 - KELLY RANCH AFFORDABLE HOUSING PROJECT JULY 9, 1998 PAGE 4 B. Target Population The affordable units will be targeted to lower-income families. With a growing number of lower-income jobs in Carlsbad, there is a significant demand for affordable housing for families which will improve the jobshousing balance. C. Terms of Affordability The Affordable Housing Agreement will be executed with the developer to ensure the affordability for the project’s useful life or 55 years, as required by the City’s Inclusionary Housing Ordinance. D. Housing ElementiConsolidated Plan Consistency The proposed affordable housing supports several Housing Element Goals and Objectives, including Objective 3.5 (Lower Income New Construction), Objective 3.6 (Inclusionary Housing), Objective 3.2 (Larger Units) and Goal 4 (Jobs-Housing Balance). The City of Carlsbad’s Consolidated Plan identifies housing opportunities for large, lower-income renter families as a top ranking priority. The proposed project meets the priorities, goals and objectives of the City for affordable housing. VII. CONSTRUCTION PHASING As with all combined affordable housing projects to date, construction of the development will be phased. A Phasing Schedule is contained within the Affordable Housing Agreement as Exhibit B. Approval of the Affordable Housing Agreement will allow for the recordation of the final map and the development of 144 (16% of the total project) single family homes for Village E. Once the Site Development Plan is formally approved by the City Council, the entire apartment project site has been graded, and the site posted with signs indicating the forthcoming apartment project, 242 (28%) building permits will be issued. Of these permits, 110 will be for market rate units and 132 will be for the affordable units. Next, once all building permits have been issued, building foundations complete, inspected and approved for the 132 affordable units, 346 (40%) market rate building permits may be issued. Finally, once final certificate of occupancy permits have been issued for all 132 affordable units, the final 145 (17%) market rate building permits may he issued. The construction phasing noted above allows for the developer to proceed with construction of a reasonable number of the market rate homes before construction must begin on the affordable housing units. Staff believes that the phasing plan set forth within the agreement is also consistent with the inclusionary housing ordinance which requires concurrent construction of the affordable housing units. SDP 98-4 - KELLY RANCH AFFORDABLE HOUSING PROJECT JULY 9,1998 PAGE 5 VIII. ENTITLEMENTS The Kelly Ranch project is currently processing several applications for the development. The City Council has previously approved the tentative map for Planning Area E and the final map is currently under review by City Staff. The final map will not be approved until such time as the Affordable Housing Agreement is approved and executed. The tentative map and related applications for the remainder of the project are currently under review by City staff. The pending applications will all require approval by both the Planning Commission and City Council at a future date. The site development plan, which includes elevations and floor plans for the affordable housing project will be brought back tu the Housing Commission at a later date for additional review. IX. ON-GOING REOUIREMENTS OF THE CITY The City will monitor the development of the project and its on-going management. A Regulatory Agreement with Security Capital will be required regarding affordability requirements and the management of the project. The developer will be required to file an annual report with the Housing and Redevelopment Department regarding compliance with the Agreement. X. SUMMARY AND RECOMMENDATIONS It is the role of the Housing Commission to make recommendations to the Planning Commission and City Council based on several considerations with respect tu affordable housing projects. These are: The proposal’s effectiveness in serving the City’s needs and priorities as expressed in the Housing Element of the General Plan and the HUD Consolidated Plan. The proposal’s consistency with the City’s affordable housing policies and ordinances as expressed in the Housing Element, Inclusionaty Housing Ordinance, Density Bonus Ordinance, etc. The proposal’s development and operating feasibility, emphasizing the development team capacity, financing sources and the role of the City in providing financial assistance or incentives. As indicated above, the Housing Commission is requested to make a recommendation on the Affordable Housing Agreement only. The site development plan will be returned to the Commission for further review and consideration. However, based upon the conceptual plans that have been provided, it appears that the proposed affordable housing project will serve the needs and priorities set forth within the City’s Housing Element, Consolidated Plan, and the City’s affordable housing policies and ordinances. Kelly SDP 98-4 - KELLY RANCH AFFORDABLE HOUSING PROJECT KJLY 9, 1998 PAGE 6 Ranch has selected a developer which has experience in developing and managing apartment projects and has the necessary resources to finance the project. At this time, there is no request for financial assistance from the City. Staff is recommending approval of the proposed affordable housing agreement, as presented, to satisfy the inclusionary housing obligation of the Kelly Ranch Project. As required by the Inclusionary Housing Ordinance, the developer and the City must enter into an Affordable Housing Agreement prior to recordation of a final map for development within the Kelly Ranch Project. As mentioned previously, the Affordable Housing Agreement presented for review and a recommendation of approval by the Housing Commission records specific requirements of the Inclusionary Ordinance, including unit type, affordability levels and construction timing. In summary, staff is recommending that the Housing Commission approve a recommendation to the Planning Commission and City Council to approve the Affordable Housing Agreement for the Kelly Ranch Project, in substantially the form presented at this time. XII. EXHIBITS 1. Housing Commission Resolution No. 98-010 2. Draft Affordable Housing Agreement 3. Reduced Plan Exhibits 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOUSING COMMISSION RESOLUTION NO. 98-010 THAT THE HOUSING COMMISSION RECOMMEND TO THE CITY COUNCIL APPROVAL OF AN AFFORDABLE HOUSING AGREEMENT FOR THE DEVELOPMENT OF 132 AFFORDABLE APARTMENT UNITS NECESSARY TO SATISFY THE INCLUSIONARY HOUSING REQUIREMENT FOR THE KELLY RANCH DEVELOPMENT. APPLICANT: KELLY LAND COMPANY AND PTR DEVELOPMENT CASE NO.: SDP 98-04 WHEREAS, the developer of the Kelly Ranch Development has proposed to construct 132 apartment units affordable to lower income households as a means to satisfy their affordable housing obligation as permitted by Carlsbad Municipal Code Section 21.85 of the City's Inclusionary Housing Ordinance; and WHEREAS, the Affordable Housing Agreement for the developer's proposal to construct said units has been submitted to the City of Carlsbad's Housing Commission for review and consideration; and WHEREAS, said Housing Commission did, on the 9" day of July, 1998, hold a public meeting to consider the Affordable Housing Agreement for said proposal to construct 132 affordable apartment units; and WHEREAS, at said public meeting, upon hearing and considering all testimony, if any, of all persons desiring to be heard, said Commission considered all factors relating to the proposal to construct said affordable housing units. NOW, THEREFORE, BE IT HEREBY RESOLVED by the Housing Commission of the City of Carlsbad, California, as follows: 1. The above recitations are true and correct. 2. The Affordable Housing Agreement is consistent with the goals and objectives of the City of Carlsbad's Housing Element and Consolidated Plan, the Inclusionary Housing Ordinance, and the Carlsbad General Plan. .. 1 2 3 4 5 6 7 0 9 10 11 12 13 14 15 16 17 10 19 20 21 22 23 24 25 26 27 20 The Affordable Housing Agreement provides a total of 132, one, two and three bedroom affordable apartment units. The project, therefore, has the ability to effectively serve the City's housing needs and priorities as expressed in the Housing Element and the Consolidated Plan. That based on the information provided within the Housing Commission Staff Report and testimony presented during the public meeting of the Housing Commission on July 9, 1998, the Housing Commission ADOPTED Resolution No. 98-010, recommending APPROVAL to the City of an Affordable Housing Agreement for the potential development of 132 affordable apartment units in order to satisfy the requirements of the inclusionary housing requirement for the Kelly Ranch Development. That the Housing Commission recommends that the City Manager or his designee be authorized by the City Council to execute the Affordable Housing Agreement as presented by the applicant to the Commission on July 9, 1998, and subject to review and approval by the City Attorney. PASSED, APPROVED, AND ADOPTED at a regular meeting of the Housing Commission of the City of Carlsbad, California, held on the 9' day of July, 1998, by the following vote, to wit: AYES: NOES: ABSENT: ABSTAIN: KATHLEEN DUNN-WELLMAN, CHAIRPERSON CARLSBAD HOUSING COMMISSION DEBBIE. FOUNTAIN HOUSING AND REDEVELOPMENT DIRECTOR HC RESO. NO. 98-010 PAGE 2 "EXHIBIT D" SCHEDULE OF MAXIMUM ELIGIBLE TENANT INCOMES AND AFFORDABLE RENTS [ATTACH CITY SCHEDULE] -16 - - Exhibit 3 I . -. , D 5 n 3 D T I ! ! - I E - . P z D N I L I P D z N 0 . Q D z r z V D z r : LJ L- U z 5 P .. j .. . V z I 0 L I pay Patchett - Kelly Ranch Affordable “lsing Agreement - Page 1 To: From: Debbie Fountain Date: 712am IO:~~AM Subject: Kelly Ranch Affordable Housing Agreement In response to some of the questions raised during the Council briefings yesterday on the Kelly Ranch Affordable Housing Agreement, here is some additional information related to the project: 1. The size of Planning Areas D, G and H are as follows: D.27 gross acres and 7.4 net acres; G=21.3 gross acres and 15.6 net acres; H=14.6 gross acres and 9.9 net acres. The total gross acres is 62.9 with net acres (developable acres) equal to 32.9. that area with only $10,000 per unit would not be enough to get the units done. The City would still have to 2. Planning Area D alone would probably be adequate to accommodate a 50 unit apt project. However, kick in some money or go elsewhere to find the additional $$. Wlth Planning Areas D, G and H as well as $10k a unit (for 22 units), we could get the project done without having to find $ elsewhere because we could sell off the excess land to raise $. 3. The current zoning for the property is PC which does not regulate housing type. The General Plan designation of RM limits the # of units per acre but not type. At this time, Planning’s position is that the attached apartment product type proposed for Planning Areas D, G and H would be acceptable as long as they are within the acceptable density. 4. The application for the Kelly Ranch SDP is currently under review by the Planning Department. An EIR still needs to be completed for the project and processed. It is anticipated that the EIR process won’t be complete until approximately November of this year. The project would then be required to go to Planning Commission, etc. Consequently, final action on the SDP will probably occur sometime after the first of the new year (1999), approximately 6 months away. 5. According to Engineering, Planning Area E is conditioned to provide full street improvements (4 lanes, to provide the improvements from El Camino Real to Frost Street in year 1 and then from Frost Street to medians, signals, etc) for Cannon Road for the entire frontage of Planning Area E. They were conditioned for Planning Area E. the west end of Planning Area E in year 2. There were no other conditions related to street improvements 6. The Phasing Plan (Chart - Exhibit B to Agreement) is being corrected and will be presented tonight for revision approval. We left out the words “27% of the MF project must be affordable units” in the 2nd box of the third tier of plan. I think this answers the various questions that were raised during the briefings, which I was unable to answer at the time. If any additional information is required, please let me know. Thanks!! Ray Patchett cc: Lloyd Hubbs. Marty Orenyak, Michael Holzmiller "RITE IT - DO.N'T SAY 4T! Date Auvust 24 19 98 To Pile QReply Wanted From Isabelle Paulsen ON0 Reply Necerrarv On this date, Kathleen Shoup responded to my inquiry by agreement coming from Craig Ruiz, Housing ti Redevelopment. stating that there would most likely not be a fully signed Kathleen stated that Karen said that the agreement needed to be amended and that Lee said to file this document.