HomeMy WebLinkAbout2004-03-02; City Council; 17524; Affordable Housing: Northpark at La Costa Sub-Div.CITY OF CARLSBAD -AGENDA BILL
AB# 17,524 TITLE: APPROVAL OF AN AFFORDABLE HOUSING
AGREEMENT TO ALLOW A HOUSING ALTERNATIVE TO
MTG. 3/2/04 SATISFY THE INCLUSIONARY HOUSING REQUIREMENT
DEPT.HD.~ w
CITY ATTY.
DEPT. HlRED
RECOMMENDED ACTION:
FOR THE NORTHPARK AT LA COSTA SUBDIVISION CITY MGR.
ADOPT Council Resolution No. 2004-065 APPROVING an Affordable Housing
Agreement with Hall Land Company, Inc., to allow a housing alternative to satisfy the
lnclusionary Housing requirement for the Northpark at La Costa subdivision.
ITEM EXPLANATION:
The Northpark at La Costa project is located on the north side of Lavante Road, between La
Costa Avenue and Centella Street. The project allows for the subdivision of an approximately
1.55 acre parcel of land, resulting in 12 single family homes. Per the City’s lnclusionary Housing
Ordinance, the project has a requirement to provide two affordable housing units. When the
project was approved, the Planning Commission recommended approval of two options for
satisfying the inclusionary housing requirement. The developer could request City Council
approval to 1) develop two second dwelling units within the market rate development or, 2)
purchase two affordable housing credits in the off-site combined project known as Villa Loma
Apartments. The developer is seeking City Council approval to construct two second dwelling
units, which is considered to be a housing alternative under the City’s lnclusionary Housing
Ordinance.
The lnclusionary Housing Ordinance allows the Council to approve a housing alternative when
that alternative supports specific housing policies and goals. Alternatives include, but are not
limited to, acquisition and rehabilitation of affordable units, conversion of existing market units to
affordable units, construction of special needs housing projects or programs (shelters,
transitional housing, etc.), and the construction of second dwelling units. Approval of the housing
alternative shall be based on findings that new construction would be infeasible or present
unreasonable hardship in light of such factors as project size, site constraints, market
competition, price and product type disparity, developer capability, and financial subsidies
. available.
Due to the small size of the market rate development (12 single family homes) and the very
substantial financial subsidy that would be required to make the market rate units affordable, the
developer has indicated that it would present an unreasonable hardship upon the Northpark at
La Costa development to require that two of the single family homes be made affordable to low
income households. Therefore, the developer is proposing to construct two second dwelling
units within the approved residential development to satisfy the inclusionary housing
requirements. While the proposed second dwelling units will be newly constructed units and will
be located within the market rate development as required, they are considered to be a housing
alternative, as defined by Section 21.85.070 of the lnclusionary Housing Ordinance. Therefore,
the alternative requires City Council approval.
Staff Recommendation
The developer’s justification for constructing a housing alternative to satisfy the inclusionary
requirements has been reviewed by Housing and Redevelopment Department staff. Staff
concurs with the developer that the small size of the new market rate development (12 single
family homes) and the substantial subsidy required to make two single family homes affordable I
to low income households within the proposed development would be financially difficult and
present an unreasonable hardship. Therefore, staff recommends that the City Council approve
the proposed affordable housing agreement to allow two second dwelling units within the market
rate development as an alternative to satisfy the inclusionary housing requirement for the
Northpark at La Costa subdivision.
Affordable Housing Aqreement
Prior to the issuance of a final map or issuance of any building permits for the project, the
developer is required to enter into an Affordable Housing Agreement with the City that binds the
developer to the specifics of the affordable housing project. The Agreement will require the
second dwelling units be rented at an amount which is affordable to a low income household
earning 70% or less of the San Diego County Area Median Income (AMI), and the tenant‘s
income does not exceed 80% of AMI. It is requested that the Affordable Housing Agreement,
attached as Exhibit 3, be approved by the Council in substantially the form presented and
subject to final approval by the City Attorney.
ENVIRONMENTAL REVIEW
The Planning Director has determined that the project is categorically exempt from the
requirements of the California Environmental Quality Act. No further environmental review is
required as part of the approval of the subject alternative to satisfy the City’s lnclusionary
Housing Ordinance.
FISCAL IMPACT
The Developer has made no request for financial assistance for this project. Therefore, there will
be no fiscal impact to the City.
EXHIBITS
1. City Council Resolution No. 2004 - 065 , to approve an affordable housing
agreement to allow the Northpark at La Costa Subdivision to utilize the housing alternative of
second dwelling units to satisfy the City’s lnclusionary Housing requirements.
2. Developer request to construct housing alternative on-site to satisfy inclusionary housing
requirements.
3. Affordable Housing Agreement.
4. Vicinity Map
DEPARTMENT CONTACT: Craig Ruiz, (760) 434-281 7, cruiz@ci.carlsbad.ca.us
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CITY COUNCIL RESOLUTION NO. 2004- 065
THAT THE CITY COUNCIL APPROVE AN AFFORDABLE HOUSING AGREEMENT
WITH HALL LAND COMPANY, INC., TO ALLOW A HOUSING ALTERNATIVE
THROUGH THE CONSTRUCTION OF TWO SECOND DWELLING UNITS TO
SATISFY THE INCLUSIONARY HOUSING REQUIREMENT FOR THE
NORTHPARK AT LA COSTA SUBDIVISION.
APPLICANT: NORTHPARK AT LA COSTA SUBDIVISION
CASE NUMBER: CT02-25
WHEREAS, on June 18,2003, the Planning Commission approved the Northpark at La
Costa subdivision to allow for the development of 12 single family homes on property located on
the north side of Lavante Road, between La Costa Avenue and Centella Street, and which
includes a requirement to provide two housing units affordable to low income households per the
City of Carlsbad’s Inclusionary Housing Ordinance; and
WHEREAS, the developer of the Northpark at La Costa subdivision has proposed to
meet the project’s Inclusionary Housing Ordinance requirement with an alternative housing
solution which would result in the developer providing two second dwelling units within the
market rate development which will be affordable to low income households; and
WHEREAS, the Inclusionary Housing Ordinance allows, at the discretion of the City
Council, a housing alternative when the proposed alternative supports specific housing policies
and goals and a determination is made that the new construction would be infeasible or present
unreasonable hardship; and
WHEREAS, based upon the City Council’s determination that it would be financially
infeasible and would represent an unreasonable hardship upon the subject developer to make two
of the single family homes within the subject development affordable to low income households
and the proposed alternative to satisfy the inclusionary requirement through the construction of
two second dwelling units on the site of the market rate development does meet the goals of the
Inclusionary Housing Ordinance and the City’s Housing Element; and
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CC Resolution No. 2004-065
Page 2
WHEREAS, the City Council did hold a public meeting to consider the developer’s
request to approve an affordable housing agreement to allow two second dwelling units to satisfy
the inclusionary housing requirement for the Northpark at La Costa subdivision located on the
north side of Lavante Road, between La Costa Avenue and Centella Street; and
WHEREAS, upon hearing and considering all testimony, if any, of all persons desiring
to be heard, said City Council considered all factors relating to the proposed inclusionary
housing alternative.
NOW, THEREFORE, BE IT HEREBY RESOLVED that the City Council of the City
of Carlsbad, California, does hereby find as follows:
1. The above recitations are true and correct.
2. The developer’s proposal to provide two second dwelling units affordable to low
income households on the site of the market rate development as an alternative to
constructing two single family homes and making them affordable to low income
households to satisfy the inclusionary housing requirement for the Northpark at La
Costa subdivision is consistent with the goals and objectives, and serves the priorities
of, the City of Carlsbad’s Housing Element, Consolidated Plan, the Inclusionary
Housing Ordinance, and the Carlsbad General Plan.
3. As required by Section 21.85.070 of the Carlsbad Municipal Code, the City Council
hereby finds that the requirement to construct two single family homes and make
them affordable to low income households within the Northpark at La Costa market
rate development would be financially infeasible and would present an unreasonable
hardship on the developer due to the development’s small project size of 12 units and
the substantial subsidy required to make those units affordable to a low income
household.
4. That based on the information provided within the City Council staff report and
testimony presented during the public meeting of the City Council, the City Council
hereby approves an Affordable Housing Agreement, in substantially the form
presented and subject to final approval by the City Attorney, to allow two second
dwelling units on the site of the market rate development as an acceptable housing
alternative to providing two single family homes affordable to low income
households to satisfy the Inclusionary Housing requirement for the Northpark at La
Costa subdivision.
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CC Resolution No. 2004-065
Page 3
5. That the Community Development Director or his or her designee is authorized by
the City Council to execute all documents related to approval of the subject
alternative inclusionary housing proposal, including but not limited to an Affordable
Housing Agreement in substantially the form presented to the City Council and
subject to final approval by the City Attorney.
PASSED, APPROVED, AND ADOPTED at a regular meeting of the City Council of
the City of Carlsbad, California, held on the 2nd day of March % 2004, by the
following vote, to wit:
AYES: Council Members Lewis, Finnila, Kulchin, Hall and Packard
NOES: None
ABSENT: None
ABSTAIN: None
ATTEST:
CC Resolution No. 2004-065 Page 3
(SEAL)
I0675 SORRENTO VALLEY ROAD, SUITE 200B
SAN DIEGO, CALIFORNIA 92121
(858) 558-33 10 /FAX: (858) 558-3312
February 6,2004
Craig D. Ruiz, Management Analyst
City of Carlsbad Housing & Redevelopment
2965 Roosevelt Street, Suite B
Carlsbad, CA 92008-2389
Re: Northpark at La Costa; Affordable Housing Agreement
Dear Mr. Ruiz,
Paragraph #I 2 of Planning Commission Resolution 5422, which was adopted in
conjunction with the approval of Tentative Map CT 02-25 provides for the
construction of two rent restricted second dwelling units for the purpose of
satisfying the Carlsbad affordable housing requirements.
executed and forwarded to your office an agreement for the designation of Lots 8
and 12 as these dwelling units.
Hallmark has now
This is a 12-unit single family project. It would take a substantial financial
subsidy to make two of these units affordable to low income households.
This method of satisfying the requirements was chosen because of the financial
unfeasibility of the alternative.
Thank you for your inquiry respecting this provision. Please contact me further if
you have further comments.
n Thank you,
Bruce Douthit
Project Manager
EXHIBIT 3
Recording Reauested by:
City of Carlsbad
When Recorded Mail to:
City of Carlsbad
City Clerk’s Office
Attn: Cityclerk
1200 Carlsbad Village Drive
Carlsbad, California 92008
(Space above fir Recorder’s Use)
AFFORDABLE HOUSING AGREEMENT
THIS AFFORDABLE HOUSING AGREEMENT (“Agreement”) is entered into this day
of
(hereinafter referred to as the “City”), and Hall Land Company, Inc., a California Corporation, (hereinafter
referred to as the “Developer”), is made with reference to the following:
,2004 by and between the CITY OF CARLSBAD, a municipal corporation
RECITALS
A. Developer is the owner of certain real property in the City of Carlsbad, County of San Diego,
State of California, described in “Attachment A”, which is attached hereto and incorporated herein by this
reference, and which is the subject of a Tentative Map CT 02-25, which provides conditional approval of
the construction of twelve (12) single family dwelling units (“Project”).
B. Condition No. 12 of Planning Commission Resolution No. 5422, states that this Affordable
Housing Agreement shall be entered into between the City and the Developer as a means of satisfying the
Developers’ affordable housing obligation (“Affordable Housing Obligation”), as such is defined under
Chapter 21.85 of the Carlsbad Municipal Code. Planning Commission Resolution No. 5422 provides that
the Affordable Housing Obligation will be satisfied by applying the requirements set forth in this
Agreement for two (2) affordable housing lots (“Affordable Housing Lots”). The Affordable Housing Lots
which are subject to this Agreement are:
Lots 8 and 12 of Carlsbad Tract No. CT 02-25 in the City of Carlsbad, County of San
Diego, State of California, according to Map thereof No. filed with the
County Recorder of San Diego County on
C. Developer intends to construct the required inclusionary units concurrent with the project’s
market units that are also identified on Exhibit “A”. The Affordable Housing Lots shall be subject to this
Agreement and this Agreement shall be recorded on each Affordable Housing Lot.
NOW, THEREFORE, incorporating the foregoing Recitals and in consideration of the mutual
covenants contained herein, the parties agree as follows:
1. The Recitals Are True And Correct.
2. SATISFACTION OF AFFORDABLE HOUSING REOUIREMENTS THROUGH
CONSTRUCTION OF SECOND DWELLING UNITS.
Performance under this Agreement satisfies the Developers’ obligation for affordable housing
under Chapter 2 1.85 of the Carlsbad Municipal Code as applied to the land covered by Tentative Map CT
02-25, including Condition No. 12 listed in Planning Commission Resolution No. 5422, and any other
applicable condition of approval.
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3. SECOND DWELLING UNITS.
(a) Construction of Second Dwelling Units. Developer shall at the time a residential structure is
constructed on the Affordable Housing Lot, include in such residential structure a Second Dwelling Unit
as defined under and subject to the requirements contained in Municipal Code Section 21.10.015.
(b) Restriction on Rental of Second Dwelling Unit. The maximum monthly rent for any Second
Dwelling Unit, subject to this Agreement, which becomes rented or leased shall not exceed an amount of
1/12th of thirty percent (30%) of the gross monthly income of a low-income household, adjusted for
household size, at seventy percent (70%) of the San Diego County median income, as such median income
is published by the United States Department of Housing and Urban Development from time to time. 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 required 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 any separately charged fees, utility charges, or service charges assessed by the lessor and payable
by the tenant (but not including fees and charges resulting from any default by the tenant or damage caused
by the tenant, or fees or charges paid by the tenant to third party utilities or other providers). A sample
schedule showing the calculation of the maximum rental amount as for 2004 is attached to this Agreement
as Attachment “B”.
(c) Restriction on Tenant Income. 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.
(d) Declaration. Developer shall require the purchaser from Developer of an Affordable Housing
Lot upon which a Second Dwelling Unit has been constructed to sign an affidavit or declaration under
penalty of perjury, in a form prescribed by the City Planning Director, which states that if the Second
Dwelling Unit on the affordable housing lot is rented that it shall be rented at a monthly rental rate not to
exceed the rate set forth in paragraph 3(b) and to a household whose income which does not exceed that
amount set forth in paragraph 3(c). Developer shall forward the original declaration to the City Planning
Director for maintenance in the City’s files, and retain a copy for its own files in the event proof becomes
necessary.
(e) Deed Restriction. Prior to the sale of an affected lot, the Developer shall provide proof to the
City Planning Director that the language contained in Exhibit “C” has been included in each deed prior to
the sale of an affected property and will run with the land so as to restrict subsequent transfers.
4. REMEDIES
Failure by the Developer to perform in accordance with this Agreement will constitute failure to
satisfy the requirements of Chapter 21.85 of the Carlsbad Municipal Code and Condition No. 12 of
Planning Commission Resolution No. 5422. Such failure will allow the City to exercise any and all
remedies available to it including but not limited to withholding the issuance of building permits for the
lots shown on Carlsbad Tract No. CT 02-25.
5. HOLD HARMLESS
Developer will indemnity and hold harmless (without limit as to amount) 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,
obtained, allegedly caused by, arising out of or retaining in any manner to Developers’ actions or defaults
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thereto. Developer’s shall obtain, at its expense, comprehensive general liability insurance for
development of the Project naming Indemnities as additional insureds with aggregate limits of not less than
one million dollars ($1,000,000) purchased by Developer from an insurance company duly licensed to
engage in the business of issuing such insurance in the State of California, 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 any building permit for the Project.
6. 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
address set forth below:
TO THE CITY:
City of Carlsbad
Housing and Redevelopment Department
Attn: Housing & Redevelopment Director
2965 Roosevelt Street, Suite B
Carlsbad, California 92008-2389
TO THE DEVELOPERS:
Hall Land Company, Inc.
Michael J. Hall, President
10675 Sorrento Valley Road, #200B
San Diego, CA 92121
Any party may change the address to which notices are to be sent by notifjmg the other parties of the new
address, in the manner set forth above.
7. ENTIRE 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.
8. DURATION OF AGREEMENT
This Agreement shall terminate and become null and void upon repeal, termination, or modification
of any applicable ordinance which act would render the Affordable Housing Obligation unnecessary or
unenforceable. The restriction set forth in Paragraph 3(b) above shall terminate as to the Affordable
Housing Lot at such time as the Second Dwelling Unit on the Affordable Housing Lot has reached the end
of its useful life, which is assumed to be not less than 55 years from the date of completion of original
construction.
9. SUCCESSORS
This Agreement shall benefit and bind Developers and any successive owners of Affordable
Housing Lots.
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10. SEVERABILITY
In the event any provision contained in this Agreement is to be held invalid, void or unenforceable
by any court of competent jurisdiction, the remaining provisions 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 signed as of the
day and year first above w-ritten.
DEVELOPERS CITY
City of Carlsbad, a Municipal corporation
By: By:
Name Micha4 JI #all
Title President Community Development Director
Sandra L. Holder
If required by City, proper notarial acknowledgment of execution by contractor must be attached.
Corporation, Agreement must be signed by one corporate officer fiom each of the following two groups.
*Group A.
Chairman,
President, or
Vice-President
**Group B.
Secretary,
Assistant Secretary,
CFO or Assistant Treasurer
Otherwise, the corporation
corporate seal empowering the officer(s) signing to bind the corporation.
attach a resolution certified by the secretary or assistant secretary under
APPROVED AS TO FORM:
RONALD R. BALL, City Attorney
By:
Jane Mobaldi, Assistant City Attorney
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ACKNOWLEDGEMENT
State of California 1
County of San Diego
On Januaty 28,2004 , before me, Lauri E. Walker I
Notary Public, personally appeared
personally known to me (H ) to be the
person(!) whose name($) is/p subscribed to the within instrument and acknowledge to
me that he/$te/tbey executed the same in his/m/tm authorized capacity(@), and that
by his/tyir/tMr signature@) on the instrument the person(@, or the entity upon behalf of
which the person($) acted, executed the instrument.
Michael J. Hall
WITNESS my hand and official seal.
t
11 P
Signature of Notary Public
ATTACHMENT A
LEGAL DESCRIPTION OF SUBJECT PROPERTY
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ATTACHMENT B
MAXIMUM MONTHLY RENTAL AMOUNT
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ATTACHMENT C
DEED RESTRICTION
A Second Dwelling Unit has been constructed as part of this property, and shall be maintained
and utilized in accordance with the requirements of Carlsbad Municipal Code Section 21.10.015
for the usefid life of the main structure (estimated to be 55 years). The maximum monthly rent
for the Second Dwelling Unit, if rented or leased, shall not exceed an amount equal to thirty
percent (30%) of the gross monthly income of a low-income household, adjusted for household
size, at seventy percent (70%) of the San Diego County median income as such median income is
published by the United States Department of Housing and Urban Development from time to
time. Prior to subsequent transfers of the property, seller shall require the purchaser to submit a
signed affidavit or declaration under penalty of perjury on a form satisfactory to the City
Planning Director, to the Planning Department, which acknowledges that the purchaser has read
and understand the restrictions as they relate to the Second Dwelling Unit. 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.
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CORPORATE RESOLUTION
AUTHORIZING THE SIGNATURE OF MAPS & DOCUMENTS
FOR THE SUBDIVISION & DEVELOPMENT OF LAND AND THE
CONSTRUCTION & SALE OF HOMES IN THE CITY OF
CARLSBAD, CALIFORNIA
RESOLVED: That Michael J. Hall, the President of Hall Land Company,
Inc., a California Corporation, is hereby authorized and empowered for and
on behalf of and in the name of this corporation to do all acts and to
execute all maps and documents that are necessary in the ordinary course
of business in the subdivision and development of land and the
construction and sale of homes, and that the signature of Michael J. Hall is
the one and only signature needed to perform such acts.
I, Michael J. Hall, President of Hall Land Company, Inc. a corporation
created and existing under the laws of the State of California, do hereby
certify and declare that the foregoing is a full, true and correct copy of a
resolution duly passed and adopted by the Board of Directors of said
corporation at a meeting of said Board duly and regularly called, noticed
and held, at the office of said corporation on the 16th day of January, 2004,
at which meeting a quorum of the Board of Directors was present and
voted in favor of said resolution; and that said resolution is now in full
force and effect.
I further certify that the office referred to in the foregoing resolution is now
held by the following, whose signature appears after their respective name.
Exhibit 4
Vicinity Map
North Point at La Costa