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HomeMy WebLinkAbout1997-10-23; Housing Commission; MinutesMinutes of: HOUSING COMMISSION Time of Meeting: 6:OO P.M. Date of Meeting: Place of Meeting: CALL TO ORDER: Chairperson Schlehuber called the Special Meeting to order at 6:OO p.m. PLEDGE OF ALLEGIANCE: The pledge of allegiance was led by Commissioner Calverley. ROLL CALL: Present: OCTOBER 23, 1997 CITY COUNCIL CHAMBERS Chairperson Schlehuber, Commissioners Calverley, Escobedo, Latas, Noble, Rose, Scarpelli, and Walker Absent: Commissioner Wellman Staff Present: Debbie Fountain, Acting Housing and Redevelopment Director Craig Ruiz, Management Analyst Leilani Hines, Management Analyst Toni Espinoza, Housing Specialist I1 Cissie Sexton, Office Specialist Dee Landers, Senior Planner Bobbi Nunn, Housing Program Manager Jane Mobaldi, Deputy City Attorney Pat Kelley, Principal Building Inspector APPROVAL OF MINUTES: ACTION: Motion by Commissioner Scarpelli, and du.; seconded, to approve ;&*e Minutes of the Regular Meeting of September 1 1, 1997, as submitted. Calverley, Latas, Rose, Scarpelli, Walker VOTE: 5-0-3 AYES: NOES: None ABSTAIN: Escobedo, Noble, Schlehuber COMMENTS FROM THE AUDIENCE ON ITEMS NOT LISTED ON THE AGENDA: There were no comments from the audience. NEW BUSINESS: 1. SECOND DWELLING UNITS - Discussion item requested by the Housing Commission. Debbie Fountain reviewed the background of the request and stated that there were two issues specifically that the Housing Commission brought up at the September 1997 meeting regarding second dwelling units, one being sound proofing requirements and the other being the legality of requiring a homeowner to rent a second dwelling unit. Ms. Fountain said that at the Commissions’ request, Pat Kelley, Principal Building Inspector, was present to explain sound proofmg requirements. In addition, Jane Mobaldi, Deputy City Attorney, was present to explain the legal issues the Commission requested. HOUSING COMMISSION MINUTES OCTOBER 23,1997 PAGE 2 Jane Mobaldi addressed the Commission and stated that after reviewing the state law regarding second dwelling units and the municipal code, the Commission can make the rental of second dwelling units mandatory. The state law, which talks about planning, discusses the fact that the state wants to encourage the building of second dwelling units because they often provide below-market prices for people occupying the units. The state law is not specifically in the context of meeting Housing Element Goals for purposes of affordable housing, she said. When the state is referring to below-market prices, Ms. Mobaldi does not consider that to be synonymous with affordability in terms of the Inclusionary Ordinance; therefore, she said the City is free to require additional restrictions if the second dwelling units are going to be used for purposes of the Inclusionary Ordinance. She added that she believes the City can make the rental mandatory and can make the rental affordable in terms of the Inclusionary Ordinance, and can also inquire into the income of the tenant to make sure they are income-qualified. The problem is how these regulations will be enforced if they are adopted. The existing Ordinance will have to be amended to make rentals mandatory because the current Second Dwelling Unit Ordinance makes rentals something that is permissive rather than mandatory and makes affordability an issue only if the second dwelling unit is rented. The current Ordinance does not get into the issue of the tenant’s income qualification, she added. Chairperson Schlehuber asked if there were any questions of Ms. Mobaldi. Mr. Rose asked if the City has any control over who the renter might be. Ms. Mobaldi responded that currently if the owner wants to rent the property, the law says the owner should be renting on an affordable basis, based on the affordability standards set up under the Inclusionary Housing Ordinance. She added that there is no current mechanism for mandating the owner to rent the unit. The owner could choose to have a family member living in the unit free of charge. If it is rented, the rent needs to be made affordable. There is no mechanism ensuring that the person renting meets those affordability standards in terms of their income and documentation of their income, she said. Pat Kelley from the Building Department addressed the Commission about the sound proofing issue. Mr. Kelley stated that the Uniform Building Code, as the state has modified it, has a minimum standard for the sound proofing that is required between attached dwelling units, including second dwelling units. In addition, sound proofing technically is known as a sound transmission class, which establishes a numerical value for the type of sound assembly that is built. The code requires walls and floors separating attached dwelling units to have a minimum STC rating of 50, and the architect will typically choose a pre-tested assembly from industry-wide publications that have already been tested and employ ordinary construction materials. Since the code also requires the walls or floors separating dwelling units to be a fire-resisted assembly, it is pretty easy to achieve the correct minimum STC minimum. They will typically do that with ordinary wood frame systems and insulation and a couple of unique features, he said. Mr. Kelley went over the drawings he provided for the Commissioners in their packets and described the various STC ratings. He stated that what the builders typically will do in a second dwelling unit situation, or a set of pretty inexpensive apartments, is build the next assembly down, which is a wood-framed assembly with insulation in the wall cavity. The dry wall on one side of the wall is attached by the use of a product known as a resilient channel, which is a metal extrusion that is mounted on the wall. The dry wall is screwed to the extrusion so that the dry wall floats out from the wall surface, which inhibits the sound vibrations of transmitting through the wall. If built properly this would achieve a STC rating of 54, which exceeds the 50 required by the Code. On a more commercial type of situation, such as the Carlsbad Lutheran Home, a builder will choose to employ a dual wall system with two independently-framed walls separating dwelling units, with a STC rating of almost 60, which is a very noise-proof system. Mr. Kelley explained the floor-ceiling assembly that separates dwelling units. He said the typical sound floor system builders use employ insulation and the resilient channel below the floor joist; and the dry wall would be screwed to the resilient channel achieving a STC rating of 54. Commercially the floor system would include an inch and a half or sometimes three-quarters of an inch of light-weight concrete over the plywood. This is a very heavy system which is HOUSING COMMISSION MINUTES OCTOBER 23,1997 PAGE 3 used only on the higher-quality attached residential products. Mr. Kelley stated that this system typically will eliminate any noise complaints from the neighbors above. Mr. Kelley stated that the kind of dwelling unit separation typically seen with second dwelling units is the assembly giving a 54 rating, which by no means is a sound-proof system; however, it does exceed the minimum state requirement. The State Building Code is what the City is required to enforce as a minimum construction standard. It is possible for the jurisdiction to modify the code to a more restrictive standard, but the jurisdiction is limited to changes that are unique to Carlsbad because of climatic, topographic, geographic, or geologic conditions; and it is pretty difficult to argue that Carlsbad has an unique climatic condition that requires the City to have more sound-proof dwelling units. Mr. Kelley recommended not to require builders to exceed the minimum requirement that is in the Code; however, he said that this does not mean the Commission cannot negotiate the sound proofing as a condition, as any other condition they want to ask them to exceed. Chairperson Schlehuber asked if there were any questions of Mr. Kelley. There were none. Chairperson Schlehuber asked if there were any comments from the public on second dwelling units. Mr. Jerry Livingston, Staff Council for the Building Industry Association, 6336 Greenwich Drive, Suite A, San Diego, addressed the Commission and said that the Building Industry Association represents the building industry in the County of San Diego. He said that he had heard there was some consideration of removing second dwelling units as a means of meeting the Inclusionary Housing Ordinance. He said he is before the Commission to encourage them to let the program continue. To his knowledge, there has been no indication or fmdings that second dwelling units have not been at least successful so far. He suggested the Commission give the program some time to work because it has not been in existence long enough to show that it is not a valuable resource. Working for the Department of Housing and Community Development for the County as a Housing Assistant, one of the things Mr. Livingston experienced was the difficulty of finding one-room space for elderly, which is one of the uses second dwelling units are intended for. There were considerably longer waiting lists for family members to get people into Section 8 kind of housing, and this will allow those people who want to bring family members in to have that opportunity to have an affordable space that is close to them and more valuable to them. Mr. Livingston would like to encourage the Commissioners to continue the Ordinance for a while and not recommend any changes to it. Mr. Mike Howes, Hofman Planning and Associates, 2386 Faraday Avenue, Suite 120 in Carlsbad, addressed the Commission and said that he understands there is some concern about how second dwelling units are going to be used and how many of the units are actually being approved in the City of Carlsbad. He stated that according to the CHAS study, of the total units that have been built, under construction, or approved in the City since the inclusionary program started, second dwelling units only represent 13 percent of the total units, which is a fairly small number, he said. They also provide two opportunities that are difficult to deal with; one is to integrate affordable units in and among a market- rate project; the bigger problem is the economy of scale. He said that most of the affordable developers he has worked with have said you need a large-scale project of 50 units or more to really make this work to get the financing and funding to pull it together. Mr. Howes would like the Commission to give the program a chance to work. The program has only been in effect for a short time, and there has only been two large projects built that are using second dwelling units. He suggested taking a look to see how effective they are before not giving them any credit. Mr. Rick Schroeder, UDC Homes, 438 Camino del Rio South, San Diego, addressed the Commission and said he is before them representing UDC who has the original second dwelling units in Carlsbad at the Seabreck project. Mr. Schroeder said that the second dwelling units are grabbing a section of the market that a lot of people have overlooked for a while. He said that the project includes 19 units, 15 of which are sold or reserved. Of those 15, approximately 100 percent of those are being occupied by either family members or close relatives that have either come to help in case of a family crisis or taking care of a younger child or an older adult; or families with older teenagers and young adults who are not ready to be quite on their own but still have a little bit of independence with the second dwelling unit. Mr. Schroeder said second dwelling units allow people living on a fixed incomes to rent at an HOUSING COMMISSION MINUTES OCTOBER 23,1997 PAGE 4 affordable rate, and brings them into a nice community. He said that the homeowners are very happy with the second dwelling units, and he could provide letters of recommendation from the homeowners who have praised the project. He would like to see the program continue, and said that it has been good for UDC to be able to have affordable housing on-site instead of paying a fee or building something else. He likes the fact of being able to accomplish the secondary and affordable housing within the same community. Mr. Doug Avis, Benchmark Pacific, 5055 Avenida Encinas, Suite 2 10, Carlsbad, addressed the Commission and commented that the marketplace proves the second dwelling units to be a very effective tool. He thinks second dwelling units market acceptable and commented that it would be difficult to legislative or enforce renting second dwelling units at an affordable rent. Mr. Avis said there is a concern that second dwelling units become a pool or rec room for a regular single family home. He said if they are going to qualify as affordable housing units, then they should be used as such. He believes that it will be very difficult to enforce like an 100-unit apartment project that is financed via affordability either through tax credit financing or some other similar mechanism. But in the actual control of how the unit is built, there is some enforceability. Mr. Avis stated that if the unit has a direct doorway to the house, it should then be required to be a one-bedroom unit to make it a living unit as opposed to making it a recreation room. If it is not directly attached, then it should be able to be allowed as an affordable unit. Ultimately and finally, the question of affordability is one that is very difficult to control, but the marketability of it is going to probably lead to its own affordability just by the size and scope of the unit. Mr. Avis commented that if rent is not being charged to a family member living in a second dwelling unit, that does not necessarily mean that the unit is not accomplishing the goals of the affordable housing problem. Mr. Avis said he would encourage the Commission to not over-regulate the second dwelling units and hopes the Commission makes the second dwelling units become a viable tool. Mr. Avis added that the rule that builders cannot mitigate more than 20 percent of their affordable housing requirement as second dwelling units is a good one. Chairperson Schlehuber closed the public testimony and opened the item for discussion among the Commission members. There was discussion among the Commissioners regarding over-regulating second dwelling units. It was the consensus to not over-regulate second dwelling units and to “keep an eye” on them because they are so new. Commissioner Walker suggested doing a study on how the second dwelling units are being used. Commissioner Scarpelli, speaking as the second president of the Building Industry Association, said that the concern the Commission has is if second dwelling units are in fact being used as affordable housing since the industry is getting credit for affordable housing units. In addition, he thinks that second dwelling units can be monitored by the City. He suggested the City contact the owners of second dwelling units to inform them a tenant is available as a unit is empty. The Commission’s concern has been that there are marketable units available with 80 percent of median income. He added that second dwelling units are not an escape hatch for meeting inclusionary housing requirements or affordable housing requirements. Chairperson Schlehuber mentioned that the issue of second dwelling units has come up every month since the Guidelines have been established. He would like the Commission to get to the point where they can present to the development community something the Commission likes and they can have good confidence that the Commission will move ahead on a project. Chairperson Schlehuber asked the Commissioners if they have any issues with the seven guidelines they previously established. There was discussion regarding sound proofing, an inside laundry facility, plumbing for an inside laundry, and the 20 percent rule (Guideline 7). Commissioner Rose asked who supplies the refrigerator and stove for second dwelling units. ,- HOUSING COMMISSION MINUTES OCTOBER 23,1997 PAGE 5 Mr. Kelley responded that the builder has to provide a cooking appliance to make it a dwelling unit. The UDC product has a nice package with a two-burner cooktop set flush with the counter top, he said. He added that there may or may not be a refrigerator provided by the developer except in customized kitchens. Mr. Schroeder said that they plumb everything out and offer all the amenities such as a refrigerator and a stacked washeddryer if the owner want to purchase them with the unit. The refrigerators are generally smaller and are purchased with the unit, he added. ACTION: Motion by Commissioner Latas, and duly seconded, that Guideline 8 be added, requiring a small but adequate laundry unit be installed in each second dwelling unit for the use of the tenant. VOTE: 1-7-0 AYES: Latas NOES: ABSTAIN: None Calverley, Escobedo, Noble, Rose, Scarpelli, Schlehuber, Walker Commissioner Schlehuber suggested requiring the plumbing be put in place and leave it up to the tenant to use. Commissioner Calverley does not think it is proper for the Commission to require this and would prefer to look at each project individually. The Commissioners asked for an annual survey from property owners of the second dwelling units. ACTION: VOTE: 8-0-0 AYES: NOES: None ABSTAIN: None Motion by Commissioner Noble, and duly seconded, that the Housing Commission ACCEPT the report presented on October 23, 1997, without further action. Calverley, Escobedo, Latas, Noble, Rose, Scarpelli, Schlehuber, Walker 2. SOUTHEAST QUADRANT HOUSING PROJECT STATUS - Discussion of report on proposed or potential housing projects in the Southeast Quadrant of the City of Carlsbad. Craig Ruiz stated that the purpose of this report is to examine the projected inclusionary requirements of undeveloped property within the southeast quadrant of the City. This is a similar report to what was presented last month on the southwest quadrant, he said. Mr. Ruiz explained that this quadrant is broken down into six zones. He showed the Commissioners a chart which indicated the total number of approved or potential units, the number of inclusionary units that are required or will be required based on the maximum zoning allowed on the property, and the method of satisfying the housing requirements within each zone. He said the report does not include projects that have seven units or less because developers are eligible to pay an in-lieu fee and do not have to produce inclusionary housing. Mr. Ruiz explained that between this report and last month’s report, there are 159 credits available in the Villa Loma project, and those credits are available to both the southeast and southwest quadrants. There are also 17 credits in the Laurel Tree project which are only available in the southwest quadrant. Looking at the major projected growth in these two quadrants, Staff predicts there could be a maximum of 197 total credits demanded. Right now with Laurel Tree and Villa Loma, there would be 179 credits available, so there is an excess surplus demand of 18 units. Staffs experience indicates that not every project gets developed at the maximum; so most likely some of the projects will develop at a lower growth potential. So while there is this small surplus demand, it is Staffs opinion there are still sufficient units to satisfy the needs of both quadrants. HOUSING COMMISSION MINUTES OCTOBER 23,1997 PAGE 6 Chairperson Schlehuber asked if there were any questions of Staff. Commissioner Latas asked for clarification of the numbers. Mr. Ruiz clarified the numbers for him as stated in the paragraph above. 3. OCEAN BLUFF - Application to purchase affordable housing credits in the Villa Loma housing project. Mr. Craig Ruiz stated that this project is a request by the applicant to purchase affordable housing credits in the Villa Loma project. Previously they had been approved to build a 16-unit apartment project on their property to satisfy their Inclusionary Housing obligation, and now they are requesting to purchase credits. It is the developer’s statement that due to the large subsidies to develop the apartment project, it would be financially unfeasible to construct. This item has been continued twice by the Commission. When the project was first presented, a question was raised about the future projects if this project purchased credits. This inquiry resulted in the two reports on the southeast and southwest quadrants. At the conclusion of the first meeting it was continued again. The original Staff report had a proforma for a rental project that was prepared in 1995, and the Commission asked for an updated rental proforma. It was also asked that the applicant provide a proforma for a for-sale project; and the developer was asked to contact additional non-profit agencies about developing this project. Mr. Ruiz said that the proformas are attached to the Staff report as Attachments 3 and 4. The new rental proforma indicates that there would be a financing shortfall of approximately $1 million; with a 16-unit project that would work out to about $60,000 per unit. The for-sale proforma indicates there would be about an $800,000 financing gap which would require a subsidy of approximately $50,000 per unit. Staff has looked at the proformas and done some analysis of them, and they seem acceptable as far as the numbers provided. Mr. Ruiz said that the developer, as requested, contacted an additional non-profit organization-- Community Housing of North County--who indicated that due to the small size of the project they would not be interested in developing the project because it would not be financially feasible for them. As stated at the two previous meetings, it is Staffs opinion that there is adequate justification to support the request to purchase credit in Villa Loma. The subsidies needed to develop the project make the development unfeasible and would not be the best use of the Housing Trust Fund. Compared with projects the City has done in the past with subsidies of between $5 and $1 1,000, this project would not be acceptable, he said. As shown in the two quadrant reports, there are credits available that can be purchased by this project, therefore, Staff continues to recommend this project. I Chairperson Schlehuber asked if there were any questions of Staff Commissioner Rose asked how many units are still available at Villa Loma. Mr. Ruiz responded that there are currently 157; and if this project is approved, there will be 141. Chairperson Schlehuber invited the applicant to speak. Mr. Jack Henthom, Jack Henthom and Associates, 543 1 Avenida Encinas, Suite J, Carlsbad, addressed the Commission and asked for the Commission’s acceptance of Staffs recommendation. He stated that he has responded to the Commission’s request for additional information and would be happy to answer any questions Staff may have. Chairperson Schlehuber asked if there were questions of the applicant. Commissioner Walker asked about the non-profit the applicant contacted. -. HOUSING COMMISSION MINUTES OCTOBER 23,1997 PAGE 7 Mr. Henthorn responded that the ideal situation seems to be about 50 units. After getting over 25, it starts to become more feasible, and the closer you get to 50 the more feasible it becomes. Commissioner Calverley asked for clarification of the “required local subsidy per affordable unit” of $92,775. Mr. Henthorn responded that the $92,775 includes a subsidy from the developer of $432,000. Commissioner Calverley asked for clarification of what it will cost to build each one of the units. Mr. Henthorn responded that the total project cost per unit is $172,000. Mr. Henthorn added that the numbers are high for the Laurel Tree project as well; and said there are a number of fixed costs that go into the project and added that the data is straight out of the computer as though it were prepared for a tax credit project. Commissioner Calverley said she cannot imagine not being able to build these 16 units at a lower cost because the developer is not using marble or granite or building fireplaces. Mr. Henthorn said that the hard construction costs are $82,000. Commissioner Calverley asked that for future projects the Commission get this information weeks before the meeting instead of five hours before the meeting so that the Commissioners have time to thoroughly review the data. There being no other persons desiring to address the Commission on this topic, Chairperson Schlehuber declared the public testimony closed and opened the item for discussion among the Commission members. ACTION: Motion by Commissioner Walker, and duly seconded, to ADOPT Resolution No. 97-010, recommending that the City Council APPROVE a request by the Ocean Bluff Partnership to purchase 16.24 Affordable Housing Credits in the Villa Loma housing project in order to satisfy the affordable housing obligation of the Ocean Bluff development under the City’s Inclusionary Housing Ordinance. Escobedo, Latas, Noble, Rose, Scarpelli, Schlehuber, Walker VOTE: 7-1-0 AYES: NOES: Calverley AB STAIN: None 4. POINSETTIA PROPERTIES - Request for conceptual review of Affordable Housing Component of Poinsettia Properties Specific Plan. Mr. Craig Ruiz stated that this project is a Specific Plan that has been submitted to the City and his presentation is a conceptual review of the affordable housing project. Mr. Ruiz said Staff is not asking for any approvals of any specific projects. A Site Development Plan for an affordable project and an Affordable Housing Agreement will be brought before the Commission at a later date. Mr. Ruiz said that this Specific Plan is composed of eight planning areas and is located at Poinsettia and 1-5. He described Planning Area 1 as a commercial area. Planning Areas 2 and 4 are going to be single-family residential homes. Planning Area 3 is going to be open space or a recreation area for the two single-family areas. Area 5 is going to be the site of the affordable housing project. Area 6 is going to be a mixed-use project with first floor commercial with the ability to do apartment units upstairs. Area 7 is going to be market-rate apartment units. The Specific Plan allows Area 8 to either be developed as multi-family apartments or for-sale condominiums. The Specific Plan also allows that the developer to do second dwelling units in Areas 2 and 4; and they would be allowed to do 20 percent, which would be a maximum of 30 second dwelling units if they build out to the maximum of 857 market-rate units. Planning Area 5 is the affordable housing project; the density there would apply a maximum of 142 units, but it will HOUSING COMMISSION MINUTES OCTOBER 23,1997 PAGE 8 probably be closer to 110 one, two, and three bedroom units. Area 6--the mixed use project-will have 60 units total, and they will satisfy their affordable units on-site, so nine of those 60 units will be affordable. Mr. Ruiz added that this project will have commercial as part of the master development. It will also be close to a regional shopping center and be in close proximity to mass transit. This will be a transit-oriented designed development that is consistent with the City’s Housing Goals and Housing Element; therefore, Staff is recommending that the Housing Commission recommend approval to the City Council of the affordable housing concept contained in the Specific Plan. Chairperson Schlehuber asked if there were any questions of Staff. Chairperson Schlehuber asked why this item was placed on the agenda. Ms. Fountain responded that since there has been so much discussion about second dwelling units recently, and because of the large size of this project, Staff put this item on the agenda to allow the Housing Commission to give appropriate guidance to this developer. Their Specific Plan is moving forward for approval, so Staff thought it would be a good idea to at least get feedback from the Commissioners of the concept of the mix of apartment units, second dwelling units, and some live-work units to satisfy their Inclusionary Housing obligation. If the Housing Commission finds this acceptable, the Specific Plan is going to move forward. It could be going to the Planning Commission in November. It will come back with a Specific Site Plan-a Site Development Plan-showing exactly how the affordable housing is going to be constructed. Staff felt it important for the developer to get some initial guidance to make sure they are moving in the right direction for the Housing Commission. Chairperson Schlehuber invited the applicant to speak. Doug Avis, 5055 Avenida Encinas, Suite 210, Carlsbad, CA, addressed the Commission and said that they have worked about four years on this property. He said they have worked closely with the Planning Department on a transit- oriented development concept. Basically SANDAG has made a movement recently to try to have an impact on the urban sprawl with a continued march to the east, spread road and utilities out there, and in turn they are trying to focus density back toward the transportation corridors. In urban areas like downtown San Diego, it could be 100 units per acre. In rural areas like Carlsbad or semi-rural areas, the density could be lower. The City Staff and the Council have generally agreed with the concept of taking units out of the “excess dwelling unit bank”, and putting them on this property for the purposes of designing a project that is transit oriented. Transit orientation basically in this case means to get people out of their cars and put them in a situation where they can comfortably use public transit and/or quicker access to the freeway on the occasions that they have to use their car. Mr. Avis said they tried to design a project that would allow one of their buyers to buy into the project with the clear intention of being able to go weeks at a time without having to use their car. There are a lot of trails and pedestrian orientation with bands around the transportation facility with certain density requirements. Mr. Avis said they have agreed that they would have densities of at least 15, but hopefully 20 per acre in that range. The next range is a range that still supports transit, and that is a RDM or RMH, depending on the zone or land use, where they are trying to achieve a minimum of seven, but somewhere close to nine units per acre. The control point is 11.5. Moving further away from the transit center, Mr. Avis said they are working on still having a higher density but also more of a traditional single-family product, which is alley-loaded with rear garages. This is to de-emphasis the garage door as the primary architecture feature and to maximize the pedestrian orientation, the livability of the street--shrink the streets down a little bit, get people doing things in their front yards instead of their back yards. Mr. Avis stated that they have seen enough to be convinced the market believes in this product. From the affordable housing standpoint, Mr. Avis stated that based on the project being a transit-oriented development, to have off-site affordable housing was the wrong thing to do, because what you want to promote is a mix of all kinds of people and residences to support the pedestrian flavor to the project. Mr. Avis said they have done three things to try to not just have the affordable housing on-site, but to have different products to mitigate the affordable housing requirements. HOUSING COMMISSION MINUTES OCTOBER 23, 1997 PAGE 9 Mr. Avis stated that fundamentally they are focusing most of the affordable housing on Area 5 with 100 to 109 units. The Specific Plan calls for a maximum of 109 units. Right now Mr. Avis is trying to put together an agreement with Bridge Housing and Ben Golvin (a for-profit affordable housing developer) and the City. This will probably be a tax credit project just like all the other big projects have been in the City. The difference will be that it will be located inside the Specific Plan as opposed to an off-site affordable housing project. The other element of affordable housing is within Areas 4 and 2. Mr. Avis stated they will have the ability to do second dwelling units, which accomplishes two things: (1) helps to mix the affordability up within the community and (2) allows higher densities. Mr. Avis added that there will be second dwelling units in excess of their affordable requirement. The maximum is 20 percent mitigation, but Mr. Avis estimated that somewhere around 40 percent of the housing will actually have a second dwelling unit. He said that the purpose is to get more people living closer to the transit station in a more urban area. The third element, according to Mr. Avis, is to take the retail area around the transit station and put lofts up above. They will be open with a fiamed-off bathroom and an open kitchen. These are becoming popular in downtown San Diego, and there are a few of them in the downtown Encinitas area above some of the retail. The fundamental construction allows for very affordable rents. Mr. Avis said they are going to restrict 20 percent of those units to meet the affordable requirement. Mr. Avis believes that all of these units, with a few exceptions, will fall into the affordable range simply by the nature of the product. The socio-economic purpose of this is to make this a live-work where you might have a business downstairs and actually live upstairs, which is an old concept that is regenerating all over America today. Mr. Avis added that they have worked with the Planning Department to restrict the maximum size of any retail space to be 10,000 feet; so these will be shop keepers with coffee shops, periodical shops, maybe a small bank outlet. Primarily it is “Mom and Pop” types of uses. There have been many inquires by word of mouth from people in Poinsettia Plaza, people in the cleaning business, in the coffee shop business, and the bakery business. In conclusion, Mr. Avis added that they have spent a lot of brain power, a lot of time, and a lot of money deciding what they want; which usually has not very much to do with what they end up getting. They have gone out to the five neighborhoods in the area and started a series of meetings. Mr. Avis stated they have decided to make some product amendments based upon neighborhood input. Area B will probably no longer be apartment density. It will probably be reduced down to RMH again, which will be high density, single family, which is probably more of a cottage product than anything else. Mr. Avis stated this is a responsible reaction to the neighborhood input they have had. Although view is not a consideration in any of the ordinances or land use regulations, it is a big one in the neighborhood. Mr. Avis said they are mixing the socio-economic with the affordability. Chairperson Schlehuber asked if there with questions of Mr. Avis. Commissioner Latas asked about the reduced density in Parcel B and beach access in the area. Mr. Avis responded that the project is designed with three trails systems to the beach-one down the middle of the project, and one on each side, which all lead to Poinsettia Trail System and to the beach. They all lead to the station, which is part of the goal too--to keep people out of their cars and get them to the station. Commissioner Walker inquired about the 100 to 109 units in Area 5 and the single-family affordable flats in Areas 4 and 2. Mr. Avis responded that the Land Use Summary in the Specific Plan included all three of these product types. They may exceed the number of units that are required because of the significant density reduction in Area 7. Around 100 units is a nice place to be for a tax credit project, Mr. Avis said. The other is not just an affordable housing opportunity, but a market opportunity (the second dwelling units). In an attempt to have a wider range of product for affordability, Mr. Avis is going to restrict a portion of what they call the loft units in the commercial area. HOUSING COMMISSION MINUTES OCTOBER 23,1997 PAGE 10 Commissioner Calverley commented that in Area 5 the Staff Report indicates 142 units, not 100 to 109. Mr. Avis stated it is about five acres with 100 to 109 units with 20/units per acre. Commissioner Calverley asked if there has been consideration of building more units than necessary to allow some people to buy into the project helping with financing, etc. (like Villa Loma). Mr. Avis responded that they may have a little bit of an overdraft, and thinks that what they have really tried to do, unlike Villa Loma, is to incorporate all of that product into the project as a part of the Master Plan. If this was put off- site, they would probably make it 200 units; but being on-site, they want to keep the scale and scope to fit into the overall neighborhood. Their goal is to offer these three affordable product types and mitigate it on-site and make it part of the community as opposed to putting it someplace else. Commissioner Escobedo asked about the parking situation in the commercial area. Mr. Avis responded that they are working with the Planning Department based upon a set of TOD Guidelines, which they found from the State of Washington, which was the agreed-upon rule book that was used. That rule book says to minimize the parking in the mixed-use area to encourage people to use the train and use their feet. You do not want to encourage them to drive. However, being in Carlsbad, Mr. Avis said they will probably be in a situation where they will just meet whatever the parking requirements are. Saturday, Sunday, and after a certain time in the evening, there is a very large parking lot right next door for the transit district. The goal is like a movie theater where you have a share of parking, so you do not build twice as much parking. Mr. Avis added that the on-site parking requirements will be met. Commissioner Escobedo brought up the parking situation in The Village. Mr. Avis responded that this is a lower intensity of development than what is in The Village from a commercial standpoint. The property now is zoned for office/professional in 50 percent of A, which would generate huge, peak hour traffic; and the traffic has been cut by half with this plan. Commissioner Scarpelli asked about clarification of Bridge and Ben Golvin. Mr. Avis responded that Ben Golvin was a Project Manager for Bridge. He went to work for SDG&E, and then started an affordable housing tax credit company. He worked for them for about a year, and he has since started his own for- profit development company. Mr. Avis said the team will be made up of Benchmark; Ben, who will be the actual developer of the project; and Bridge Housing, who will be the on-going operator of the project. In reality all three will be the starting team, and Ben Golvin and Bridge Housing will be the team that continues with the property. Chairperson Schlehuber asked about the conceptual approval of this project. Ms. Fountain responded that the Housing Commission is being asked to approve conceptually the mix of affordable housing being proposed with the second dwelling units, the apartment project, and the lofts. The numbers may be a little different when the actual project comes back to the Commission. It looks like the apartment project will be between 100 and 109 units; the second dwelling units will be about 30 units; and nine of the 60 loft units will be affordable product. Chairperson Schlehuber asked if 29 second dwelling units is conceptually what the Housing Commission is approving. Mr. Avis responded that it will be 20 percent of the total with a lot more second dwelling units. Chairperson Schlehuber asked about the price range of the homes. HOUSING COMMISSION MINUTES OCTOBER 23,1997 PAGE 11 Mr. Avis responded that based upon the proforma today, they think they are in the range of $135 a square foot. A lot of the houses will not be big, luxury houses--they are cottages. There are going to be some two bedrooms and some three bedrooms, and they are not going to be on large lots. Mr. Avis added that affordability is a big part of this project. This is for young people, retired people, he said. There being no other persons desiring to address the Commission on this topic, Chairperson Schlehuber declared the public testimony closed and opened the item for discussion among the Commission members. Commissioner Scarpelli commented that this project appears to meet the needs of people who need affordable housing- -young families and seniors. ACTION: Motion by Commissioner Calverley, and duly seconded, to ADOPT Resolution No. 97-012, recommending that the City Council APPROVE the Conceptual Poinsettia Properties Specific Plan. Calverley, Escobedo, Latas, Noble, Rose, Scarpelli, Schlehuber, Walker VOTE: 8-0-0 AYES: NOES: None ABSTAIN: None 5. MARIAN0 PROJECT - Application for Housing Commission review of a 27-unit affordable housing project proposed to meet the inclusionary housing obligation of the Mariano project. Craig Ruiz explained that the Mariano project is 150 single-family homes and 27 affordable apartment units. The applicant is seeking a recommendation of approval from the Housing Commission to the City Council for the development of these 27 units to satisfy their inclusionary housing obligation. Mr. Ruiz stated that the developer’s proposal is to construct the 27 units on-site. The developer at this time is not requesting financial assistance from the City. If they choose to seek assistance, that request would come back to the Commission at a later date. The apartment project will include 8 one-bedroom units with two separate floor plans and be between 550 to 635 square feet. There will be 16 two-bedroom units, which will be approximately 1,000 square feet; and 3 three-bedroom units, which will be about 1,025 square feet. The project will also provide private balconies or patios for each unit, as well as a recreational area for the development. All rents in the project will be restricted to 80 percent of median income, which is required by the Inclusionary Housing Ordinance. Rents will be approximately $700 for a one bedroom; $890 for a two bedroom; and $1,040 for a three bedroom based on current HUD guidelines. Staff believes that this project is consistent with the requirements of the Inclusionary Housing Ordinance and the Housing Element of the City’s General Plan. Chairperson Schlehuber asked if there were any questions of Staff. There were a few minor questions that Mr. Ruiz answered. Chairperson Schlehuber invited the applicant to speak. Mr. Jack Henthorn, Jack Henthorn and Associates, 543 Avenida Encinas, Suite J, Carlsbad, addressed the Commission and said he was here representing the owner of the property, Pac West. Mr. Henthorn said that this project has been in process for quite a period of time in Carlsbad and has evolved over the last several years with a plan that looks similar to what it started off with, with the exception of the affordable housing. Initially, the affordable housing was tucked back at the end of a cul-de-sac. After working with Staff, the product has been moved up closer to the Laurel Tree project, which opens up some opportunities. Mr. Henthorn hopes to get some managed economies out of the project due to its location adjacent to the Laurel Tree project. HOUSING COMMISSION MINUTES OCTOBER 23,1997 PAGE 12 Mr. Henthorn said he is here to make sure there are three words in the Staff report that are underlined (under the financial section)--“at this time.” Mr. Henthorn said he will undoubtedly be back before the City for an Affordable Housing Agreement. At that point he will have hard numbers. He added that every time the Commissioners get one of these projects, it is very early in the process, and the numbers are not final. Mr. Henthorn mentioned the magnitude of differences between the proformas on this project and the Ocean Bluff project he represented earlier. There are a number of things that are different between the two, he said. One is that this project has a 60 percent larger affordable housing component, which is up over the 25-unit hurdle. Second, there are 64 additional market units that the other project didn’t have to spread some of the costs out over. In addition, there are remarkably fewer off-site obligations. This project has Aviara Parkway stubbed out right to the property lines. The Ocean Bluff project had nearly half a mile of Poinsettia Lane to extend, plus obligations to future Black Rail Road, which is on the other end of the project. Mr. Henthorn described the project of consisting of 8 one-bedroom units, 16 two-bedroom units, and 3 three bedroom units, providing opportunities for housing for a full array of people in Carlsbad from single individuals up through families in the three bedroom units. Chairperson Schlehuber asked if there were any questions of Mr. Henthorn. Chairperson Schlehuber asked Mr. Henthorn which non-profit developer he planned to work with. Mr. Henthorn responded that they are talking to the developers on the Laurel Tree site. He added that it would be a shame not to be able to take advantage of the economies of scale and the result of savings that might accrue from this. Commissioner Latas asked if the projects are adjacent and if they will be mutually constructed. Mr. Henthorn responded that Cobblestone Road separates the two projects. He said they would like the projects to be mutually constructed. There being no other persons desiring to address the Commission on this topic, Chairperson Schlehuber declared the public testimony closed and opened the item for discussion among the Commission members. ACTION: Motion by Commissioner Noble, and duly seconded, to ADOPT Resolution No. 97-013, request for recommendation that the City Council APPROVE a 27-unit on-site affordable apartment project to satisfy the requirements of the Inclusionary Housing Ordinance for the development of 150 residential homes in the Mariano Project. Calverley, Escobedo, Latas, Noble, Rose, Scarpelli, Schlehuber, Walker VOTE: 8-0-0 AYES: NOES: None ABSTAIN: None 6. 1996 - 1997 COMPREHENSIVE HOUSING AFFORDABILITY STRATEGY ANNUAL PERFORMANCE REPORT - Review of the 1996 - 97 Annual Performance Report for the CDBG Program. Leilani Hines said that the Annual Performance Report (APR) is a report on Staffs progress in carrying out the City’s Annual Plan, which is for the CDBG/Home Program-the federal fund the City receives. It also assesses the City’s performance in meeting the Five-Year Consolidated Plan. And it is required to remain eligible to receive Community Development Block Grant Funds as well as Home Funds. h HOUSING COMMISSION MINUTES OCTOBER 23,1997 PAGE 13 Ms. Hines’ presentation focused on three things: (1) the available funds for 1996-97; (2) the expenses incurred for this program year; and (3) the number of households the City was able to assist with the programs in place. Ms. Hines said that the funds available noted in the APR are CDBG, Home, Section 8 Rental Assistance, Redevelopment Set Aside Funds for low to moderate income housing, the San Diego County MCCs or Mortgage Credit Certificate program (a first-time home buyer program), and the Housing Trust Fund. Ms. Hines described the CDBG program as a program that provides housing, community development, and social service activities for the City. Every program that the City funds through CDBG must benefit persons of low to moderate income or basically persons at 80 percent of the median income. For the CDBG program, 47 percent of the funds the City had available went to housing or housing-related activities. Out of those, six were homeless shelters that provided services to 1,262 clients; two for supportive housing services, such as Lifeline’s Shared Housing program as well as the Community Resource Center. The City funded the Single Family Rehabilitation program, which provided loans for four homes. Funds also went toward payment of the City’s Section 108 loan for the Villa Loma affordable housing project. In summary, Ms. Hines stated that last year the City had about $1.2 million in CDBG funds that represent new funds for 96-97, as well as the balance from previous years. Of that, the City spent approximately half of the money on activities and will carry over a balance of about $648,000 to the next program year. That balance is basically from public facilities or improvement projects which are a little slow in taking hold so they are usually carried over from one year to another year. In terms of the Section 8 Rental Assistance Program, the City provides rental assistance through the Section 8 program for persons with very low income; those are persons at 50 percent of the median income. In 1996-97, the City had approximately $3 million available; 10 percent of those dollars were used for program administrative costs. The City has the ability to provide Section 8 certificates or vouchers for 503 households. As of the end of the fiscal year of 1996-97, the City is currently at 479 households assisted. The Redevelopment Housing Set-Aside is a 20 percent set aside of the City’s annual redevelopment tax increment for housing for lower income households. In 1996-97, the City had a total deposit of about $400,000, of which the City spent $77,000 in admin costs. Included with the balance from previously years, the balance brought forward to 1997- 98 is about $1.7 million. For Redevelopment Housing Set-Aside funds, the City has spent money for planning and administrative costs and has a commitment for $500,000 for the Laurel Tree Apartments. There is still a remaining balance of $1.7 million. The San Diego Regional MCC Program provides mortgage credit certificates to assist low income as well as moderate income households purchase a home. In 1996-97, the City provided assistance to approximately 12 households. As of this date, there are probably mortgage credit certificates to provide for one household. The City will be applying again in December for the next calendar year. The Housing Trust Fund is kind of a “catch-all” account. There are funds coming from the Inclusionary Housing Impact fees, the Inclusionary Housing In-lieu fees, sale of affordable housing credits, the Carlsbad Home Buyer Assistance program, the MCC program admin monies, and interest is accrued on these monies. In 1996-96, the City had deposited approximately $2.5 million with $52,000 in total expenses (basically for administrative costs). There is an encumbrance of about $2 million. In 1995-96, the City did carry forward a balance of $2 million, so the ending balance as of June 30, 1997, was $2.5 million available in the Housing Trust Fund. There is a significant commitment for the available funds of about $1.3 million for the Carlsbad Home Buyer Assistance program; there is a commitment to the MCC administration funds; a $200,000 commitment to Laurel Tree Apartments; and a commitment to the Sambi program. HOUSING COMMISSION MINUTES OCTOBER 23,1997 PAGE 14 The City has been successful in meeting the goals established in the Annual Plan. All the housing opportunities, community develop activities, policies and programs are consistent with the Five-Year Consolidated Plan. This report was submitted to the US Department of HUD at the end of the program year, which was September 30 of this year. Katherine Rodman made comments regarding the City’s Redevelopment Set-aside funds, which were included in the report distributed to the Commissioners. Chairperson Schlehuber asked if there were any questions of Staff. Commissioner Scarpelli commented that perhaps the Commission should take a look at some of the properties that the City is providing Section 8 support for to see if they are livable habitats other than the health and safety issues. A number of them around the Village are crime and drug-ridden, he said. The Housing and Redevelopment Agency may have some ability of either not putting Section 8 people in properties that are not properly managed, or work with City agencies to bring about change in some of those properties. ANNOUNCEMENTS: Ms. Fountain announced that on next week’s Council agenda, Villa Loma will be getting an award from the State of California Housing Community Development Department for outstanding use of their low and moderate income housing funds and an outstanding affordable housing project. She added that redevelopment agencies submit applications as part of their annual report, and at the time Staff submit their report, Staff thought they were providing information to the State on how the City’s Redevelopment Agency did and what was supported in terms of affordable housing. The State reviewed over 200 reportslapplications, and they only picked six affordable housing projects to be honored with this award. Ms. Fountain distributed a copy of the account summary for the City’s Affordable Housing Trust Fund which had been requested at the previous Housing Commission meeting. She said there was a question raised about the balance and how the monies were committed. She added that the Commissioners can call her office if they have any questions about the report, and said that the Finance Department runs the report to help Staff keep track of the Housing Trust Fund. Ms. Fountain announced that Laurel Tree is moving forward and should be breaking ground soon. ADJOURNMENT: By proper motion, the Special meeting of October 23, 1997 was adjourned at 8:30 p.m. Respectfully submitted, 4 Y&- DEBBIE FOUNTAIN Acting Housing and Redevelopment Director KATHY VAN PELT Minutes Clerk HOUSING COMMISSION MINUTES OCTOBER 23,1997 PAGE 15 MINUTES ARE ALSO TAPED AND KEPT ON FILE UNTIL THE WRITTEN MINUTES ARE APPROVED. ~~ me City of Cwlsbad Housing & Redevelopment Department A REPORT TO THE HOUSING COMMISSION Item No. 1 Staf Debbie Fountain, Acting Housing & Redevelopment Director DATE: OCTOBER 23,1997 SUBJECT: GUIDELINES FOR SECOND DWELLING UNITS I. RECOMMENDATION At the request of the Housing Commission, this item has been added to the agenda for discussion purposes. The Housing Commission has indicated an interest in reviewing the previously recommended guidelines for the development of second dwelling units to satisfy an Inclusionary Housing Requirement of a housing developer. At this time, staff has no further recommended action. The Commission may discuss the guidelines and take action to consider an amendment to these guidelines, if appropriate. 11. PROJECT BACKGROUND On April 10, 1997, the Commission held a working session to discuss various concerns over the use of Second Dwelling units for affordable housing purposes and identified desired criteria for their future use. The Commission discussed the following issues related to Second Dwelling Units: size, design features, affordability , occupancy restrictions, monitoring and overall number of units. The Commission took action to establish draft guidelines which can be used to provide direction to housing developers as to the types of second dwelling units which will generally be supported by the Housing Commission. Attached is a copy of the guidelines developed by the Housing Commission and to be recommended for approval by the City Council. The guidelines do not prevent the Housing Commission from recommending projects for approval which are not entirely consistent with the guidelines, but they do provide a “target” for developing a second dwelling unit product which can be supported by the Housing Commission. On September 11 , 1997, the Housing Commission indicated an interest in giving additional consideration to the guidelines previously established by the Commission. At the subject Housing Commission meeting, the Commission expressed a desire to receive information from the building department on “sound proofing” and from the City Attorney’s Office on the legality of requiring a homeowner to actually rent a second dwelling unit, making it continuously available on the rental market. , HC Report October 23, 1997 Page 2 Pat Kelley, Principal Building Inspector, will be present at the Housing Commission meeting on October 23‘d to provide information on “sound proofing” requirements, per the building code. The Commission may ask Mr. Kelley questions related to “sound proofing” and its impact related to second dwelling units. It is staffs understanding that the Cornmission simply wished to receive information on this matter and had no intentions of imposing additional restrictions on a builder as related to “sound proofing”. A representative of the City Attorney’s Office will also be present at the meeting to respond to questions regarding the legality of requiring a homeowner to actually rent a second dwelling unit that has been provided to meet an inclusionary housing obligation. If the Housing Commission desires to do so, staff can be directed to make revisions to the Development Guidelines for Second Dwelling Units before they are submitted to the City Council for adoption. 111. EXHIBITS 1. Housing Commission Development Guidelines for Second Dwelling Units. - EXHIBIT I I City of Carlsbad GUIDELINES ON DEVELOMENT OF SECOND DWELLING UNITS I Approved: Purpose of Guidelines: To assist the Housing Commission and City Council/Housing and Redevelopment Commission or Planning Commission in review of projects which have proposed development of Second Dwelling Units to meet the requirements to produce affordable housing units under the City of Carlsbad’s Inclusionary Housing Ordinance. To assist housing developers to better understand the desires of the Housing Commission, and City CounciVHousing and Redevelopment Commission or Planning Commission to produce quality affordable housing which appropriately meets the needs of the Carlsbad community. To assist City staff as they work with housing developers to satisfy their affordable housing obligations under the Inclusionary Housing Ordinance Guidelines: The Guidelines developed by the Housing Commission and adopted by the City Council are as follows: 1. 2. 3. 4. Size Limits: The units shall be no larger than 640 square feet (per the Second Dwelling Unit Ordinance) and no smaller than 400 square feet, unless compelling evidence is presented by the developer which justifies a smaller size unit. Design Features: Same as those required by the Second Dwelling Unit Ordinance, with the addition that the second dwelling unit must provide a one (1) bedroom floor plan if the unit can be accessed directly from the main dwelling unit. Affordability: The affordability requirements shall be the same as those set forth within the Second Dwelling Unit Ordinance. Occupancy Restrictions: There shall be no restrictions on the total household income for occupancy purposes. If the unit is rented, however, the rent must be set at a rate which is affordable to households at 80% or below of the San Diego County Median Income. This is the same as the Second Dwelling Unit Ordinance. SDU Guidelines May 8,1997 Page 2 Form of Restrictions: The form of the restriction on the property shall be the same as that indicated within the Second Dwelling Unit Ordinance, with the addition that the Affordable Housing Agreement be recorded against the property as well. Monitoring: An annual review of the second dwelling units will be completed using a random sampling of existing units. It is anticipated that the sampling will include an appropriate representation (i.e., 20% approximately) of the units which have been constructed as of the date of the review/monitoring visit. Other Limitations: As a general guideline, second dwelling units can be used to satisfy the entire affordable housing requirement for housing projects which have less than 100 units total. For projects which provide for 100 units or more, the general rule shall be that no more than 20% of the total inclusionary housing requirement may be satisfied through the development of second dwelling units. This guideline limit is in addition to the language in the Inclusionary Housing’ Ordinance which requires City CounciVHousing and Redevelopment Commission and/or Planning Commission to give final approval to allow any use of second dwelling units as an alternative to otherwise required construction of new inclusionq units. Awlicabilitv: As Guidelines, the above criteria have flexibility for application purposes. On a case by case basis, the City Council/Housing and Redevelopment Commission, Planning Commission andor Housing Commission may consider projects for approval which are not entirely consistent with these guidelines, if the projects are otherwise deemed appropriate and consistent with the Second Dwelling Unit Ordinance. These guidelines do not amend any existing ordinance related to the Second Dwelling Units or Inclusionary Housing requirements. _- I me Ci@ of Carlsbad Housing & Redevelopment Department I I A REPORT TO THE HOUSING COMMISSION Staff Craig D. Ruiz Management Analyst DATE: OCTOBER 23,1997 SUBJECT SOUTHEAST QUADRANT HOUSING PROJECT SATUS I. RECOMMENDATION This item was added to the agenda at the request of the Housing Commission to discuss the projected inclusionary housing requirements of undeveloped property within the Southeast Quadrant of the City. This is an informational item and there is no recommended action. 11. PROTECT BACKGROUND On August 14,1997, a report was presented to the Housing Commission which projected the inclusionary housing requirements of undeveloped property within the Southwest Quadrant of the City. The report also examined if the projected development of the Quadrant could result in a demand for the purchase of off-site credits which exceed the number of available credits. The Commission has requested the following similar report for the Southeast Quadrant. 111. DISCUSSION The City is divided into 23 Facility Management Zones. Within the Southeast Quadrant, there are 6 Zones (See Exhibit "1"). Staff has reviewed the existing and potential future land uses within each zone to determine the development potential for the entire Quadrant. As detailed on the attached chart (See Exhibif "2"), within each zone, the property owner, approval date of the project, total number of approved/potential units, the number of inclusionary units required, and method of satisfying the inclusionary requirement have been identified. Projects of less than 7 units, which are eligible to pay an in-lieu fee as opposed to developing inclusionary units, have been determined to have no inclusionary housing obligation for the purposes of this report and have not been included in this report. The Southeast quadrant is comprised primarily of four large master planned communities which are in various stages of the development process. Zones 10 and 11 consists mostly of the Villages of La Costa Specific Plan. This project has not been formally submitted to the City but it is anticipated to provide approximately 400 on-site affordable units. Zone 12 is the Arroyo La Costa development. This project has satisfied its inclusionary housing obligation through the Carlsbad Homebuyer Assistance Program (CHAP). Zone 17 is the Bressi Ranch development. This project has not been formally submitted to the City. A preliminary analysis indicates the SOUTHEAST QUADRANT HOUSING PROJECT STATUS OCTOBER 23,1997 PAGE 2 project will have an approximate 89 unit inclusionary housing obligation that will be constructed on-site. Zone 18 is the Rancho Carrillo project which was before the Housing Commission at their September meeting as an informational item. The project is proposing to provide 272 affordable units on-site through the production of apartment and second dwelling units. Of the remaining undeveloped land within the Quadrant, there are three potential projects which will have an inclusionary housing obligation. These projects have a potential obligation of 2,9, and 14 units respectively. There is one existing combined inclusionary housing project, Villa Loma, which has 159 excess credits available to sell to projects in both the Southeast and Southwest Quadrants. There are also 17 excess credits in the Laurel Tree project which are available to projects in the Southwest Quadrant only. The maximum projected demand for excess credits within the two quadrants is 197. The total existing supply of excess credits is 179, resulting in a surplus demand of 18 units. While there is the potential for a small surplus demand for excess units, this is only an estimation based upon the maximum potential build-out of the Southeast and Southwest Quadrants. It has been staff's experience that projects are rarely developed at the maximum density allowed. Thus, it is staff's opinion that the current supply of excess credits will be sufficient to satisfy the needs of the Southeast and Southwest Quadrants. EXHIBITS 1. Southwest Quadrant Facility Management Zones 2. Affordable Housing/Market Rate Housing Spreadsheet m ICOS Buitt-out or Non-Residential * Affordable Housing Projects - I\] ,t t- Scale CITY OF CARLSBAD LOCAL FACILITIES MANAGEMENT ZONES SOUTHEAST QUADRANT SOUTHEASTQUADRANT AFFORDABLE HOUSING SUMMARY Villages of La Costa (source: Cinti Planning NFF’D ON SITE 1.00 1.00 142.46 ‘7 31 !.26 !22 03 19.44 0.89 8.10 9.13 19.20 1.00 4.1 1 02.87 .oo 9.50 7.52 1.60 8.62 72.40 72.40 COMBINED 2.00 2.00 I 00 1.00 I 00 1.00 I TOTAL ALL ZONES 6,361.44 1953.32 1 I 1789.92 (2.00 1 SUBJECT TO INCLUSIONARY * = proposedlconstrucledlbuilt ** = mortgage subsidy program in place Jack Henthorn Associates Affordable Housing Analysis 1 I me Ci@ of Carfsbad Housing & Redevelopment Department I A REPORT TO THE HOUSING COMMISSION Item No. 3 Staf: Craig D. Ruiz Management Analvst 1 DATE: SUB JECE OCTOBER 23,1997 CT 93-09 - OCEAN BLUFF - APPLICATION TO PURCHASE AFFORDABLE HOUSING CREDITS IN THE VILLA LOMA HOUSING PROJECT I. RECOMMENDATION That the Housing Commission ADOPT Resolution No. 97-010, recommending that the City Council APPROVE a request by the Ocean Bluff Partnership to purchase 16.24 Affordable Housing Credits in the Villa Loma housing project in order to satisfy the affordable housing obligation of the Ocean Bluff development under the City’s Inclusionary Housing Ordinance. 11. PROTECT BACKGROUND This item was originally before the Housing Commission at their August 14,1997 meeting. The Commission continued the item to the September 11,1997 meeting and directed Staff to provide a report projecting the inclusionary housing requirements of undeveloped property within the Southwest Quadrant of the City. The report was to also examine if the projected development of the Quadrant could result in a demand for the purchase of off-site credits which exceeds the number of available credits. The report indicated that there are sufficient excess units to meet the potential demand of the Southwest Quadrant. The item was again continued at the September 11,1997, meeting and the Commission directed the applicant to provide updated financial information on both the proposed apartment project and a potential for sale condominium project. In addition, the applicant was directed to contact additional non-profit agencies regarding potential participation in the project. 111. DISCUSSION The applicant has provided both a rental and for sale proforma (Attachments 2 & 3) which analyzes the finances of the 16 unit project. In March of 1995, the developer prepared a preliminary proforma on the rental project. The analysis was based on the assumption that the developer would contribute a fully constructed building pad for the affordable project. The proforma was preliminary and did not include a detailed examination of all development and operational costs. The March 1995 proforma estimated that the project would require a total City subsidy of $362,000, or an average of $22,700 per unit. CT 93-09 - OCEAN BLUFF OCTOBER 23,1997 PAGE 2 As requested by the Commission, the applicant has prepared an updated proforma. The current proforma assumes that there will be a 4% tax credit equity investment, a conventional first trust deed loan, a City loan and a developer land contribution. Based upon these assumptions, the proforma estimates that there is a $959,000 financing gap that is proposed to be bridged by a City loan. This loan would be approximately $60,000 per unit. In addition, a proforma analyzing the cost of a for sale project was also prepared. The for sale proforma is based upon the development of eight, two-bedroom and eight, three-bedroom homes which would be sold to families earning 80% of the area median income. The proforma shows an estimated shortfall of $805,000, or $50,000 per unit, which would be bridged through a City loan. The City and developer assistance, plus a percentage of property equity would be recaptured by the City through the resale of the homes on the open market. As directed by the Commission, the developer contacted one additional non-profit group about the possibility of developing the project. The developer contacted Community Housing of North County (CHNC). CHNC stated that, due to the small.size of the project, they would not be interested in developing the project. Staff is unaware of other area non-profits that could be contacted by the developer regarding this project. Included in the August 14, 1997 Housing Commission staff report was an analysis of the applicants request to purchase affordable housing credits as required by City Council Policy 57 & 58. In that report, staff relied on the financial information contained in the 1995 proforma. At that time, it was staff's opinion that there was adequate justification to support the request to purchase credits. Further, it was staff's belief that the requested City financial assistance of over $22,000 per unit was not a financially prudent use of the City's Housing Trust Fund when compared to previous City gap assistance of $5,000 to $10,000 to construct affordable housing units. The current proposed assistance amount of $50,000 to $60,000 further solidifies staff's position on this issue. As requested, the applicant has provided additional financial information to the Housing Commission to support their request to purchase credits in the Villa Loma project. Also, the applicant has shown that there appears to be adequate affordable housing credits for potential housing development in both the Southeast and Southwest Quadrants. With the additional information provided to date, staff believes that the applicant has shown that the project would not be financially feasible. Therefore, it is staff's recommendation that the request to purchase credits be recommended for approval by the Housing Commission to the City Council. EXHIBITS 1. Housing Commission Resolution No. 97-010 2. Housing Commission Staff Reports dated August 14 and September 11,1997 3. Rental Proforma 4. For-sale Proforma 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. 97-010 A RESOLUTION OF THE HOUSING COMMISSION OF THE CITY OF CAREBAD, CALIFORNIA, TO RECOMMEND THAT THE CITY COUNCIL APPROVE A REQUEST BY THE OCEAN BLUFF PARTNERSHIP TO PURCHASE 16.24 AFFORDABLE HOUSING CREDITS IN THE VILLA LOMA HOUSING PROJECT IN ORDER TO SATISFY THE AFFORDABLE HOUSING OBLIGATION OF THE OCEAN BLUFF PROJECT UNDER THE CITY'S INCLUSIONARY HOUSING ORDINANCE. APPLICANT: OCEAN BLUFF PARTNERSHIP CASE NO: CT 93-09 WHEREAS, the Ocean Bluff Partnership has received approval of Tentative Map CT 93- 19 for the development of a 92 unit residential development; WHEREAS, said subdivision of land requires the developer to provide 16.24 units of lousing affordable to lower income households as required by Carlsbad Municipal Code iection 21.85 of the City's Inclusionary Housing Ordinance; WHEREAS, the Villa Lorna housing project was conceived and developed with City ,articipation based on the creation of 184 excess affordable housing units which would be .vailable to satisfy other developers inclusionary housing obligation; WHEREAS, Ocean Bluff Partnership has requested to purchase Affordable Housing :redits as a means to satisfy their affordable housing obligations as permitted by Carlsbad dunicipal Code Section 21.85 of the City's Inclusionary Housing Ordinance and consistent rith City Council Policies 57 and 58; WHEREAS, the request to purchase Affordable Housing Credits has been submitted to he City of Carlsbad's Housing Commission for review and consideration; WHEREAS, said Housing Commission did, on the 14th day of August, 1997, hold a iublic meeting to consider said request for the purchase of Affordable Housing Credits by the Icean Bluff Partnership; WHEREAS, at the conclusion of said meeting, said Commission continued the item to he September 11,1997 Housing Commission meeting; 1 2 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 - WHEREAS, said Housing Commission did, on the 11th day of September, 1997, hold a public meeting to consider said request for the purchase of Affordable Housing Credits by the Ocean Bluff Partnership ; WHEREAS, at the conclusion of said meeting, said Commission continued the item to the October 23rd, 1997 Special Housing Commission meeting; WHEREAS, at said public meeting, upon hearing and considering aII testimony, if any, of all persons desiring to be heard, said Commission considered aII factors relating to the application and request to purchase Affordable Housing Credits; NOW, THEREFORE, BE IT HEREBY RESOLVED by the Housing Commission of the City of Carlsbad, California, as follows: 1. 2. 3. 4. 5. The above recitations are true and correct. The project is consistent with the goals and objectives of the City of Carlsbad’s Housing Element and Comprehensive Housing Affordability Strategy, the Inclusionary Housing Ordinance, and the Carlsbad General Plan. Based upon the analysis contained within the Housing Commission Staff Report, the Housing Commission finds that the off-site satisfaction of the inclusionary housing requirement is in the public interest. That based on the information provided within the Housing Commission Staff Report and testimony presented during the public meeting of the Housing Commission on August 14, 1997, the Housing Commission recommends that the City Council APPROVE a request by the Ocean Bluff Partnership to purchase 16.24 affordable housing credits in the Villa Lorna housing project in order to satisfy the affordable housing obligation of the Ocean Bluff project under the city’s inclusionary housing ordinance. That the Housing Commission recommends that the City Manager or his designee be authorized to execute the Affordable Housing Agreement in substantially the form presented in the Exhibit 3 for the Housing Commission Staff Report and to execute such other documents, or take other actions as may be necessary or appropriate to assist the developer in acquiring the Affordable Housing Credits. 1C RESO. NO. 97-010 ’AGE 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 28 General Condition: 1. Within sixty (60) days of the City Council approval of Developer's request to purchase Affordable Housing Credits, and prior to receiving Final Map approval, Developer shall execute this Agreement and pay to the City the sum of $488,824 as its payment for sixteen and twenty four one-hundredths (16.24) Credits. Execution of this Agreement by the parties and payment of the sum of $488,824 to the City by the Developer shall fully satisfy the Developer's affordable housing obligation pursuant to Chapter 21.85 of the Carlsbad Municipal Code and the above- referenced conditions of approval. Upon execution of this Agreement and receipt of the above payment from developer, City will record an appropriate release of the developer's obligation. PASSED, APPROVED, AND ADOPTED at a special meeting of the Housing Zommission of the City of Carlsbad, California, held on the 23rd day of October, 1997, by the !allowing vote, to wit: AYES: NOES: ABSENT: ABSTAIN: KATHLEEN WELLMAN, Vice-Chairperson CARLSBAD HOUSING COMMISSION IEBBIE FOUNTAIN Zcting Housing and Redevelopment Director IC RESO. NO. 97-010 'AGE 3 The City of Carfsbad Housing & Redevefopment Oepartment A REPORT TO THE HOUSING COMMISSION I Item No. 1 Sta8 Craig D. Ruiz Management Analyst DATE: SEPTEMBER 11,1997 SUBJECT: OCEAN BLUFF - APPLICATION TO PURCHASE AFFORDABLE HOUSING CREDITS IN THE VILLA LOMA HOUSING PROJECT I. RECOMMENDATION That the Housing Commission ADOPT Resolution No. 97,010, recommending that the City Council APPROVE a request by the Ocean Bluff Partnership to purchase 16.24 Affordable Housing Credits in the Villa Loma housing project in order to satisfy the affordable housing obligation of the Ocean Bluff development under the City’s Inclusionary Housing Ordinance. 11. PROJECT BACKGROUND This item was before the Housing Commission at their August 14, 1997 meeting. The Commission continued the item and directed Staff to provide a report projecting the inclusionary housing requirements of undeveloped property within the Southwest Quadrant of the City. The report was to also examine if the projected development of the Quadrant could result in a demand for the purchase of off-site credits which exceed the number of available credits. 111. DISCUSSION The City is divided into 23 Facility Management Zones. Within the Southwest Quadrant, there are 11 Zones (See Exhibit “2”). Staff has reviewed the existing and potential future land uses within each zone to determine the development potential for the entire Quadrant. As detailed on the attached chart (See Exhibit “3”), within each zone, the property owner, approval date of the project, total number of approvedpotential units, the number of inclusionary units required, and method of satisfying the inclusionary requirement have been identified. Projects of less than 7 units, which are eligible to pay an in-lieu fee as opposed to developing inclusionary units, have been determined to have no inclusionary housing obligation for the purposes of this report. Of the eleven zones, five have no future inclusionary requirements. Zones 3,4, 5, 6 and 13 have either been previously developed or have a non-residential land use designation. With respect to H:\word\Ocean Bluff HCRPTZ Zone 9, the undeveloped land consists of the Kaiza Poinsettia Development. This project has satisfied their inclusionary obligation through their participation in the Laurel Tree project. Zone 19 is comprised primarily of the Aviara development. The inclusionary requirement for Aviara has been satisfied through the development of the Villa Loma project or will be satisfied on-site in future phases of the development. Zone 23 is currently proposing to satisfy their inclusionary obligation through the development of an on-site project. Thus, Zones 20,21 and 22 contain the remaining undeveloped land which may result in an inclusionary housing obligation at some fhture date. Using the growth control management point obtained from the City’s Growth Management Ordinance, there exists a maximum development potential of 1,148 residential units within the Southwest Quadrant. The development of 1,148 units will result in an inclusionary housing requirement of 172 affordable housing units. There are two combined inclusionary housing projects in the Southwest Quadrant which contain 176 excess affordable housing credits. These projects include Villa Loma, which contains 159 credits and Laurel Tree, which contains 17 credits (based on information provided to staff to date). With a build-out projection of 172 inclusionary units and an existing supply of 176 units, there exists the potential for a surplus of 4 inclusionary housing credits. Based upon staffs above projections, the current supply of 176 affordable housing credits will be sufficient to meet the needs of the Southwest Quadrant at build-out. In addition, based upon the information presented at the August 14, 1997 Housing Commission meeting, it is staffs opinion that adequate justification exists to make the finding that the off-site satisfaction of the inclusionary housing requirement is in the public interest. Therefore, staff is recommending that the request to purchase credits be recommended for approval by the Housing Cornmission. EXHIBITS 1. Housing Commission Staff Report of August 14, 1997 2. Southwest Quadrant Facility Management Zones 3. Affordable Housing/Market Rate Housing Spreadsheet 4. Zone 20 Property Ownership H:\word\Ocean Bluff HCRPT2 EXHIBIT 1 - me Ci@ of Carlsbad Housing & Redevelopment DepaHment A REPORT TO THE HOUSING COMMISSION Item No. 2 Staf Craig D. Ruiz Management Analyst 1 DATE: AUGUST 14,1997 Continued to 9/ 1 1 /97 SUBJECT: OCEAN BLUFF - APPLICATION TO PURCHASE AFFORDABLE HOUSING CREDITS IN THE VILLA LOMA HOUSING PROJECT I. RECOMMENDATION That the Housing Commission ADOPT Resolution No. 97-010, recommending that the City Council APPROVE a request by the Ocean Bluff Partnership to purchase 16.24 Affordable Housing Credits in the Villa Loma housing project in order to satisfy the affordable housing obligation of the Ocean Bluff development under the City’s Inclusionary Housing Ordinance. 11. BACKGROUND The applicant, Ocean Bluff Partnership, has received approval for a tentative map (CT 93-09) to develop 92 single family homes on approximately 31 acres. The project will include homes of upwards of 3,000 square feet on parcels between 7,500 and 13,000 square feet. The subdivision is required to provide 16.24 units of housing affordable to lower income households as required by the City’s Inclusionary Housing Ordinance. To satisfy this requirement, the developer has also received approval of Site Development Plan SDP 93-07 for the development of a 16 unit affordable multi-family apartment project. When CT 3-09 was approved by the City Council, a condition of approval for the project allowed for the developer, upon showing that an on-site contribution is not appropriate, to purchase Affordable Housing Credits in the Villa Lorna housing project. The developer believes that there are significant constraints which preclude the development of an on-site affordable housing project. Therefore, the developer is requesting to purchase Affordable Housing Credits (“credits”) in the Villa Lorna project in lieu of on-site construction. The City’s Inclusionary Housing Ordinance permits off-site satisfaction of an inclusionary requirement through participation in a Combined Inclusionary Housing Project (“Combined Project”) if the City Council determines that it is in the public interest. Purchase of credits in the Villa Loma project constitutes participation in a Combined Project. OCEAN BLUFF AUGUST 14,1997 PAGE 2 Policies Reaarding: Off-Site Proiects and Purchase of Affordable Housina Credits The City Council has adopted two policies which deal with off-site or Combined Projects and the sale of Affordable Housing Credits. Council Policy 57 was developed to establish the criteria to be utilized in order to make the necessary finding that off-site satisfaction of an inclusionary housing requirement, when proposed through a Combined Project, is in the public interest. This policy requires review of the request and an action recommendation from the Combined Project Review (Staff) Committee consisting of the Housing and Redevelopment Director, City Manager, Financial Management Director, Community Development Director, Planning Director and City Attorney. The Mayor is an ex-officio member of the Committee. This committee has reviewed the subject request and is recommending approval. Council Policy 58 was established to determine the price of credits and the mechanism to satisfy a developers obligation under the City’s Inclusionary Housing Ordinance. Based upon this policy, the current cost to purchase a credit in the Villa Loma project is $32,220. The Ocean Bluff Project, therefore, will be required to pay to the City of Carlsbad a total of $523,252, if approved by the City Council. RECOMMENDATION The Council Policies require staff to evaluate the request for off-site satisfaction of the inclusionary housing obligation and the purchase of credits based upon three primary criteria. The criteria includes: 1) feasibility of on-site proposal; 2) relative-advantages/disadvantages of an off-site proposal; and 3) the advancement of housing goals and strategies. The following is a summary of staffs analysis of the criteria for the project. Feasibilitv of On-site Prouosal 0 The small scale of the affordable housing project makes the development economically unfeasible due the significant financial subsidy which would be required for the project. Further, the small scale of the affordable housing project makes it unlikely that the project will generate interest from funding sources. 0 It will be difficult to integrate an affordable housing apartment project into an a community of single family detached homes which have an estimated base price range of $300,000 to $350,000. Relative Advantaaes/Disadvantaees of an Off-site ProDosal The participation in the off-site project will allow the City to recover the costs associated with the development of excess affordable housing units. The Villa Loma project has locational advantages over the on-site project in terms of direct access to jobs, public transportation, schools, parks as well as other amenities and services due to the being located directly on a major thoroughfare. OCEAN BLUFF AUGUST 14,1997 PAGE 3 Advancinp Housinp Goals and Stratepies 0 The recovery of the City’s investment in the Villa Loma Project will provide for additional financial resources which are needed to further affordable housing development in the community. Based upon the analysis of the above criteria, it is staffs opinion that adequate justification has been provided to make the finding that the off-site satisfaction of the inclusionary housing requirement is in the public interest. Therefore, staff is recommending that the request to purchase credits be recommended for approval by the Housing Commission. EXHIBITS 1. Housing Commission Resolution No. 97-0 10 2. Applicant Request to Purchase Credits 3. Draft Affordable Housing Agreement cr 1 2 3 4 5 6 7 0 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOUSING COMMISSION RESOLUTION NO. 97-010 A RESOLUTION OF THE HOUSING COMMISSION OF THE CITY OF CAFUSBAD, CALIFORNIA, TO RECOMMEND THAT THE CITY COUNCIL APPROVE A REQUEST BY THE OCEAN BLUFF PARTNERSHIP TO PURCHASE 16.24 AFFORDABLE HOUSING CREDITS IN THE VILLA LOMA HOUSING PROJECT IN ORDER TO SATISFY THE AFFORDABLE HOUSING OBLIGATION OF THE OCEAN BLUFF PROJECT UNDER THE CITY’S INCLUSIONARY HOUSING ORDINANCE. APPLICANT: OCEAN BLUFF PARTNERSHIP CASE NO: CT 93-09 WHEREAS, the Ocean Bluff Partnership has received approval of Tentative Map CT 93- 09 for the development of a 92 unit residential development; WHEREAS, said subdivision of land requires the developer to provide 16.24 units of housing affordable to lower income households as required by Carlsbad Municipal Code Section 2 1.85 of the City’s Inclusionary Housing Ordinance; WHEREAS, the Villa Loma housing project was conceived and developed with City participation based on the creation of 184 excess affordable housing units which would be available to satisfy other developers inclusionary housing obligation; WHEREAS, Ocean Bluff Partnership has requested to purchase Affordable Housing Credits as a means to satisfl their affordable housing obligations as permitted by Carlsbad Municipal Code Section 21.85 of the City’s Inclusionary Housing Ordinance and consistent with City Council Policies 57 and 58; WHEREAS, the request to purchase Affordable Housing Credits has been submitted to the City of Carlsbad’s Housing Commission for review and consideration; WHEREAS, said Housing Commission did, on the 14‘h day of August, 1997, hold a public meeting to consider said request for the purchase of Affordable Housing Credits by the Ocean Bluff Partnership ; 1 I; I 4 c e 7 a 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 _- A WHEREAS, at said public meeting, upon hearing and considering all testimony, if any, fall persons desiring to be heard, said Commission considered all factors relating to the pplication and request to purchase Affordable Housing Credits; NOW, THEREFORE, BE IT HEREBY RESOLVED by the Housing Commission of the lity of Carlsbad, California, as follows: 1. The above recitations are true and correct. 2. The project is consistent with the goals and objectives of the City of Carlsbad's Housing Element and Comprehensive Housing Affordability Strategy, the Inclusionary Housing Ordinance, and the Carlsbad General Plan. 3. Based upon the analysis contained within the Housing Commission Staff Report, the Housing Commission finds that the off-site satisfaction of the inclusionary housing requirement is in the public interest. 4. That based on the information provided within the Housing Commission Staff Report and testimony presented during the public meeting of the Housing Commission on August 14, 1997, the Housing Commission recommends that the City Council APPROVE a request by the Ocean Bluff Partnership to purchase 16.24 affordable housing credits in the Villa Loma housing project in order to satisfy the affordable housing obligation of the Ocean Bluff project under the city's inclusionary housing ordinance. 5. That the Housing Commission recommends that the City Manager or his designee be authorized to execute the Affordable Housing Agreement in substantially the form presented in the Exhibit 3 for the Housing Commission Staff Report and to execute such other documents, or take other actions as may be necessary or appropriate to assist the developer in acquiring the Affordable Housing Credits. leneral Conditions: Within sixty (60) days of the City Council approval of Developer's request to purchase Affordable Housing Credits, and prior to receiving Final Map approval, Developer shall execute this Agreement and pay to the City the sum of $ 523,252 as its payment for sixteen and twenty four one-hundredths (16.24) Credits. Execution of this Agreement by the parties and payment of the sum of $ 523,252 to the City by the Developer shall fully satisfy the Developer's affordable housing obligation pursuant to Chapter 2 1.85 of the Carlsbad Municipal Code and the above-referenced conditions of approval. Upon execution of this Agreement and receipt of the above payment from developer, City will record an appropriate release of the developer's obligation. C RESO. NO 97-010 AGE 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 28 PASSED, APPROVED, AND ADOPTED at a regular meeting of the Housing Commission of the City of Carlsbad, California, held on the 14"' day of August, 1997, by the following vote, to wit: AYES: NOES: ABSENT: ABSTAIN: MICHAEL SCHLEHUBER, Chairperson CARLSBAD HOUSING COMMISSION DEBBIE FOUNTAIN Acting Housing and Redevelopment Director HC RES0 NO. 97-010 PAGE 3 - - CEAN BLUFF PA RTNERSrJIP 7825 Fay Avenue, Suite 200 La Jolla, California 92037 (61 9) 456-3594 July 15, 1997 Mr. Evan Becker Housing and Redevelopment Director City of Carlsbad 2965 Roosevelt Street, Suite B Carlsbad, CA 92008 Subject: Ocean Bluff Project -- Request to Purchase Affordable Housing Credits in the Villas at El Camino Real Project Dear Mr. Becker: This letter serves as a formal request by the Ocean Bluff Partnership to purchase off-site affordable housing credits in the Villas at El Camino Real development to satisfy the Ocean Bluff (CT 93-09) project's inclusionary housing obligations. This request is made as a part of final map processing activities. The request is in compliance with and is specifically supported by the following actions previously taken by the City Council: The City's lnclusionary Housing Ordinance (CMC Chapter 21.85) establishes certain requirements under which residential developers must provide housing that is affordable to lower-income households as a condition of project approval and permit issuance. The ordinance provides that 'circumstances may arise in which the public interest would be served by allowing some or all of the inclusionary units associated with one project site to be produced at an alternative site or sites." Planning Commission Resolution 3869, CT 93-09, .conditions also provide that "a second inclusionary housing option available to the developer shall be that the developer shall enter into an agreement with the City to purchase affordable credits from Villas at El Camino Real or participate in an off-site combined inclusionary project within the southwest quadrant and as appropriate, in accordance with the requirements set forth in Chapter 21.85 of the Carlsbad Municipal Code, the Zone 20 Specific Plan, and City Council Policies 57 and 58 dated September 12, 1985". In the case of the Ocean Bluff project, there are particular circumstances that warrant the provision of the inclusionary units off-site in combination with the existing Villas at El Camino Real Apartment project or other suitable location, pursuant to Council Policy 57 criteria. Significant feasibility issues affect the development of this project on-site. Contribution to the existing off-site project versus providing a small low-income apartment complex on-site will result in increased public benefit. 1 We understand this request will be evaluated by a staff Project Review Committee to determine compliance with the criteria defined in Policies 57 and 58. We will then take the Committee’s recommendation to the Housing Commission and City Council. As you know, we hope to expedite the process to Council since this issue must be resolved precedent to recording the final map. Please call if you need additional information or if we may be of any other assistance. Sincerelv. Mr. Robert Wineteer cc: Mr. Jack Henthorn, Jack Henthorn & Associates 2 OCEAN BLUFF PROJECT OFF-SITE AND COMBINED INCLUSIONARY HOUSING PROJECT ASSESSMENT WORKSHEET -- BACKGROUND The following background information is provided to assist you in your assessment. I. 2. 3. 4. 5. Owner/Applicant Information: Ocean Bluff Partnership Attn: Mr. Robert Wineteer 7825 Fay Avenue Suite 200 La Jolla, CA 92137 456 3594 Applicant's Representative: Jack Henthorn & Associates Attn: Mr. Jack Henthorn Suite J 5431 Avenida Encinas Carlsbad, CA 92008 4 3 8 -4 0 9 0 Off-sitelcombined Project Name: VILLAS AT EL CAMINO REAL APARTMENTS Description of Project with lnclusionary Housing Obligation: Ocean Bluff, CT 93-09, is a proposed 92-lot single family development located on a 31.2-acre parcel with a 16.24-unit affordable housing obligation. On-site Affordable Housing Description: Ocean Bluff Affordable Housing, SDP 93-07, is a 16-unit multi-family, apartment project on one lot with units ranging from 1 to 3 bedrooms. The units would range in maximum rent from approximately $450 to $600, which is affordable to households earning incomes of 50% to 80% of the Area Median Income. To achieve feasibility, the project would require a subsidy of $362,737 (even assuming a fully constructed pad is provided by the developer and unit incomes are based on a 95% occupancy rate factor). Proposed Off-site Project Description: The Villas at El Camino Real project is a 344-unit apartment development in which all units are restricted and affordable to households with incomes not exceeding 60% of the San Diego County Median. Villas at El Camino Real was developed by La Terraza Associates, with Bridge Housing Corporation as the Managing General Partner. The complex contains 1 , 2, 3 & 4 bedroom units. Villas at El Camino Real was financed with assistance from the City of Carlsbad and the Carlsbad Redevelopment Agency. The assistance was structured in such a way as to create affordable units which would be marketed exclusively by the City to "other developers" in order to satisfy an affordable housing obligation. Villas at El Camino Real Apartments is a Combined Project according to the lnclusionary Housing Ordinance, and developers may participate in this as an "off-site" method of satisfying their affordable housing obligation. (This is also an approved site as per Specific Plan Amendment #203 for the Costa Do Sol project, currently called Greystone Cove.) 3 Participation in Villas at El Camino Real Apartments by the applicant would be in the form of a purchase of Affordable Housing Credits (Credits) under terms established by City Council Policies Number 57 and 58. If the applicant is afforded the opportunity to purchase Credits, the Ocean Bluff tentative map would require the purchase of 16.24 Credits to satisfy its inclusionary housing requirement. 6. Description of On-site Project Constraints: Specific constraints exist which would affect the on-site affordable project’s feasibility. These include the uneconomical scale of the affordable project and a the significant price difference between the affordable rental units and the proposed single-family market units that will be developed in and around this project. In addition to these constraints, the location of the Villas at El Camino Real project is superior to the on-site location. Access from the subject site to nearby jobs, shopping, transportation, schools, parks, bus stops and other services and amenities to the north and east will be limited. Direct routes will not be available to nearby Palomar Airport Road and El Camino Real until well after the units are constructed. Contrary to this, the Villas at El Camino Real project is already conveniently located with direct access onto El Camino Real, providing convenient access to needed services and jobs. 4 -- OCEAN BLUFF PROJECT OFF-SITE AND COMBINED INCLUSIONARY HOUSING PROJECT ASSESSMENT WORKSHEET - WORKSHEET 1. Feasibility of the On-site Proposal a. Are there significant feasibilitv issues due to factors such as project size, site constraints, amount and availability of required subsidy, and competition from multiple projects that make an on-site option impractical? 0 The on-site affordable project is of marginal size as an apartment project. Given the small size of the project and its restricted rental structure, on site management and maintenance will be difficult. The market units in this project would be required to absorb over $5700 per unit so that land development costs could be contributed. This figure would rise to over $9600 per unit if the applicant is required to build the units on site and close the post land development gap of $362,737. Based on the estimated restricted rental prices of the affordable units the applicant will be facing an average subsidy requirement of approximately $22,700 per unit, beyond land contributions. This would result in each unit being subsidized with over $55,000. b. will an affordable housing product be difficult to intearate into the proposed market development because of significant price and product type disparity? 0 Price disparities will be substantial between the low-income rental apartment units restricted at $450- 600 rent and the approved higher-end single-family, detached product with an estimated base price range of $300,000 to $350,000. The integration of 16 affordable apartment units, sized at 600 to 1,000 sq. ft., into the single-family subdivision with homes over 3,000 square feet on 7,500 to 13,000 sq. ft. lots will result in major product type disparity on-site. The surrounding area will also be built-out with low density, single- family detached products consistent with the existing RLM land use designation and market demand. The on-site project would, therefore also result in substantial product disparity with the surrounding region. c. Does the on-site development entity have the capacity to deliver the proposed affordable tiousing on-s ite? 0 0 The applicant is not experienced in the development of affordable housing. Affordable housing developers have advised the applicant that it is unlikely that this size of project will generate interest from funding sources. 2. Relative AdvantaqeslDisadvantanes of the Off-site Proposal. a. Does the off-site option offer greater feasibilitv and cost effectiveness than the on-site alternative, particularly regarding potential local public assistance? Villas at El Camino Real is built and has proven its feasibility; no additional assistance is required. Nearly 500 affordable units have been recently completed or are in process of approvals in the southwest quadrant. It is possible that affordable unit production could outpace market development. The applicant's participation in Villas at El Camino Real would permit the intended recovery of City investment provided to the project through utilizing "excess units". These funds could then be used 5 ,- to provide additional affordable housing. Conversely, the developer's on-site project would create the demand for additional new subsidy. The small size of the on site project could result in additional future subsidy requests related to operating costs. b. Does the off-site proposal have location advantaqes over the on-site alternative, such as proximity to jobs, schools, transportation, services; less impact on other existing developGents, etc.? The Villas at El Camino Real location has advantages over the on-site project in terms of direct access to jobs, public transportation, schools, parks, as well as, other amenities and services due to being located directly on the major thoroughfare, El Camino Real. Villas at El Camino Real is a self-contained affordable development in an area designated for higher density residential development such as condominiums and townhomes. The on-site proposal could be a source of land use conflicts that typically occur when higher density development is permitted adjacent to larger lot single family development. 0 0 c. Does the off-site option offer a development entity with the capacity to deliver the proposed project? 0 The Villas at El Camino Real project is an existing project, developed and managed by a highly experienced and specialized affordable housing developer. d. Does the off-site option satisfy multiple developer obliqations that would be difficult to satisfy with multiple projects? 0 0 Villas at El Camino Real project was originally established as a Combined Project, specifically to address this purpose. The proposed on-site project would be one of several projects in the southwest quadrant competing for scarce financial assistance. Villas at El Camino Real has already been financed and built and thus, would not be competing for subsidy financing. 3. Advancinq Housinq Goals and Strateqy a. Does the off-site proposal advance andlor support City housing goals and policies expressed in the Housing Element, WAS and lnclusionary Housing Ordinance? General Plan Housing Element and CHAS Goals: 0 Villas at El Camino Real Apt. affordable project is targeted to the highest priority need identified, larger rental units for low income households. The recovery of City investment in Villas at El Camino Real through the applicant's participation will provide additional resources which are needed to assist further affordable housing development. Villas at El Camino Real provides a large quantity and diversity of affordable housing stock with its 344 units, including a generous supply of different size units to meet various housing needs of the community. lnclusionary Housing Ordinance Policies: Consistent with the City and public interests to use existing "excess" affordable units before supporting additional new construction. In conjunction with the combined Villas at El Camino Real project, Ocean Bluff will provide for 15% of the total units for affordable (lower income) residential units. The project also complies with the lnclusionary requirements as contained in the Zone 20 Specific Plan and the General Plan Housing Element. 6 Growth Management Zone, Specific Plan (SP 203), Ord. No. NS-257 Guidelines: Villas at El Camino Real is coordinated with surrounding properties by providin direct acces to a major Circulation Element Roadway, El Carnino Real, aswell as circulation and pedestrian access to public facilities. Villas at El Carnino Real affordable housing product is consistent with the anticipated clustered multi- family attached and stacked flat unit types identified in the Specific Plan. 0 Planning Commission Resolution No. 3869, Case No. CT 93-09, approved by City Council: 0 The offsite provision of inclusionary housing is consistent with Condition #22 which reads: "Upon showing by the developer that an onsite contribution is not appropriate for the project, a second inclusionary housing option available to the developer shall be that prior to final map approval, the developer shall enter into an agreement with the City to purchase affordable credits from Villa Lorna or participate in an offsite combined inclusionary project within the southwest quadrant and as appropriate, in accordance with the requirements set forth in Chapter 21.85 of the Carlsbad Municipal Code, the Zone 20 Specific Plan, and City Council Policies 57 and 58 dated September 12, 1985. Prior to City Council approval, the developer shall submit a signed Affordable housing Agreement to the Housing and Redevelopment Director." 7 This AFFORDABLE AFFORDABLE HOUSING - HOUSING AGREEMENT MITIGATION AGREEMENT, entered into this day of I 19 , by and between the CITY OF CARLSBAD, a Municipal Corporation (hereinafter referred to as the "City"), and OCEAN BLUFF PARTNERSHIP, (hereinafter referred to as the "Developer"), is made with reference to the following: A. Developer is the owner and developer of property generally located at the northwest corner of the future Poinsettia Lane and Blackrail Court in the Zone 20 Specific Plan' area and Local. Facilities Management Zone in the City of Carlsbad, in the County of San Diego, California (hereinafter referred to as the "subject property").. The subject property is more particularly described in Exhibit "A", which is attached hereto and is incorporated herein by this reference. B. Developer wishes to construct 92 single family homes upon the subject property. The City Council has approved Zone Change ZC93-04, Local Coastal Plan Amendment LCPA95-09, Carlsbad Tract/Parcel Map CT 93-09, Hillside Development Plan HDP 93-09 and the Planning Commission has approved Site Development Plan SDP 93-07, for the proposed development. The City Council and Planning Commission issued these approvals subject to conditions of discretionary approval. C. The Developer was conditioned with the ability to satisfy its affordable housing obligation in accordance with Chapter 21.85 of the Carlsbad Municipal Code by purchasing sixteen and twenty four one-hundredths (16.24) Affordable Housing Credits (Credits) in the Villa Loma affordable housing project. D. Pursuant to the above-referenced conditions of approval, and in accordance with City Council Policies 57 and 58, the Developer has received approval from the City Council by Resolution No. 97- , dated , 1997, to purchase Credits in the off-site project known as Villa Loma. The City controls and has available these Credits in Villa Loma and the project meets the requirements of a Combined Inclusionary Housing Project as defined in Chapter 21.85 of the Carlsbad Municipal Code. Purchasing Credits according to the terms of this Agreement satisfies the developer's affordable housing obligation in accordance with Chapter 21.85 of the Carlsbad Municipal Code and the developer's conditions of approval. NOW, THEREFORE, it is mutually agreed by and between the undersigned parties as follows: 1. SATISFACTION OF AFFORDABLE HOUSING OBLIGATION AND CONDITIONS OF TENTATIVE MAP APPROVAL THROUGH THE PURCHASE OF AFFORDABLE HOUSING CREDITS Within sixty (60) days of the City Council approval of Developer's request to purchase Affordable Housing Credits, and prior to receiving Final Map approval, Developer shall execute this Agreement and pay to the City the sum of $ 523,252 as its payment for sixteen and twenty four one-hundredths (16.24) Credits. Execution of this Agreement by the parties and payment of the sum of $ 523,252 to the City by the Developer shall fully satisfy the Developer's affordable housing obligation pursuant to Chapter 21.85 of the Carlsbad Municipal Code and the above- referenced conditions of approval. Upon execution of this Agreement and receipt of the above payment from developer, City will record an appropriate release of the developer's obligation. Failure of the Developer to perform according to the terms of this Agreement will be a failure to satisfy the Tentative Map Conditions with respect to the subject property and Chapter 21.85 of the Carlsbad Municipal Code; and the City may exercise any and all remedies available to it with respect to the Developer's failure to satisfy the Tentative Map Conditions including but not limited to withholding the issue of building permits for the subject property. 2. CITY ACKNOWLEDGES DEVELOPER PAYMENT. By executing this Agreement, City acknowledges receipt ' of Developer's payment under the terms of this Agreement. 3. DEVELOPER WAIVES RIGHTS TO OTHER METHODS OF SATISFYING AFFORDABLE HOUSING OBLIGATION. By executing this Agreement, developer waives any and all rights to other means of satisfying the affordable housing obligations required by Chapter 21.85 of the Carlsbad Municipal Code and the conditions of approval. 4. HOLD HARMLESS. The undersigned developer (hereinafter referred to as "Indemnitor"), for and in consideration of the City of Carlsbad's approval of this Agreement, and for other good and valuable consideration, the receipt and sufficiency whereof is hereby acknowledged by Indemnitor, does hereby covenant, undertake and agree that it will indemnify and hold harmless (without limit as to amount) the City of Carlsbad 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 _- A damage (including expense) sustained or incurred because of or by reason of any and all claims, demands, suits, actions, judgements 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 in any manner to this Agreement, and to protect and defend Indemnitees, and any of them with respect thereto. 5. 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, CA 92008-2389 TO THE DEVELOPER: Ocean Bluff Partnership Attn: Bob Wineteer 7825 Fay Avenue, Suite 200 La Jolla, California 92037 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. 6. 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. 7. DURATION OF AGREEMENT. This Agreement shall terminate and become null and void when the City has received the payment described in Paragraph 1, except as to the indemnity and hold harmless provisions setforth in Paragraph 4. 8. 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 Agreement to written. DEVELOPER be WHEREOF, executed Ocean Bluff Partnership the as By : Signature Print Name - Titre: parties hereto of the day and have year caused this first above CITY OF CARLSBAD A Municipal Corporation By : MARTIN ORENYAK Community Development APPROVED AS TO FORM: RONALD R. BALL - City Attorney Di r EXHIBIT "A" PROPERTY DESCRIPTION Lot 3 in Section 22, Township 12 south, range 4 west, San Bernardino base and meridian in the County of San Diego, Sate of California, excepting therefrom those portions thereof lying north of the south boundary line of Rancho Agua Hedionda, as said south line was established May 5, 1913, by decree of the Superior Court of the State of California, in and for San Diego County, in that certain action (No. 16830) entitled Kelly Investment Company, a corporation, vs. Clarence Dayton Hillman and Bessie Olive Hillman. -viii- EXHIBIT 2 Built-out or Non-Residential * Affordable Housing Projects CITY OF CARLSBAD LOCAL FACILITIES MANAGEMENT ZONES SOUTHWEST QUADRANT EXHIBIT 3 yellow = projects c 7 units cream = pendinglappr'vdlbuilt 1t.blue = proposing construct. gold = existing combined prjct Affordable Spreadsheet - ........ 29250.00 78975.00 76050.00 51425.00 40950.00 114075.00 78975.00 122850.00 !3400.00 33600.00 !6325.00 13875.00 i 57950.00 ........................ ............... ............. .........> ......... -But LT OUTiNON-RES I )ooo 10.00 Ix 0.00 X 0.00 X BUILT OUT/NON-RES BUILT OUTINON-RES 0.00 0.00 BUILT OUTINON-RES Jo.00 10.00 Jx I Jo L'Tree Kaua Poinsettia: 94-04 AI ' 311 5195 94-05 A2 311 5/95 94-06 A3 * 6/20195 94-06 A4 711 1/95 9448 B1 611 3/95 94-12 C withdrawn BUILT OUTINON-RES .............. ... .......,....... .... .::.<;:x.< LFI Aviara Phase I * I 2/4/90 329.00 1093.00 677.00 151.00 449.00 72.00 Phase It * 2/19/91 Phase 111 8/13/96 1/6/91 0.00 0.00 10.00 0.00 0.00 2.00 4.00 0.00 3.90 0.00 0.00 3.15 2.00 0.00 6.00 0.00 4.00 0.00 0.00 0.00 0.00 X 6.00 1.20 5.00 1 .oo X 2.00 8.00 515.00 3060.00 E75.00 57180.00 !575.00 i060.00 '090.00 Buerger Cardosa 127.00 Carnation Cobblestone " 5/8/96 Emerald Ridge: East * 6/13/96 212.00 0.00 (26.00 26.00 69.00 0.00 71 .00 0.00 21 .00 21 .oo 14.00 14.00 119.00 0.00 39.00 39.00 j 0.00 27.00 0.00 0.00 57.00 0.00 182.00 0.00 M4lZ" Engler Femandez 1-1 Gre stone Cove * 31 1 9/96 Kramar 1/3/96 Mariano ** 311 5/94 42.00 42.00 8.00 8.00 32.00 32.00 9.00 9.00 116.00 15.00 15.00 54.00 54 .OO Nelson Ocean Bluff 4/2/96 Poinsettia Partners Affordable Spreadsheet Page1 yellow = projects < 7 units cream = pendinglappr'vdlbuilt Itblue = proposing construct. gold = existing combined prjct Affordable Spreadsheet Rudvalis Samhi. San Dieguito Sarkaria Schindler Sud. Int. Mission Sugino Tabata Trust Tabata N&E: rhompson rhompson Thompson Thompson Neidner famarnoto ... Nestern Pacific * qeiter, W hitney. jfregola,Bowen (-) Ualdonado 3ons :arkbad Partners ( - ) :ity of Carlsbad ieiter .ohf Jamikas judduth bane ( - ) lesaska jteiner ........... ..... ................... larious owner: Ward and Lear Devlin EdwarddRounsv'le Tartaglia Cambell Alsop Shugard Donahue Stanton Wood Bachman Dickie and Berry Hart McCabe 'allas I BUILT OUT 'oinsettia Properties:' .vas Lusk) T97-10 incomplt :T97-11 PA 2 :T97-12 PA 4 JI Coast Enterp. Ueiss(1) 'arious owners: Pacific Riviera Crowell and Smith Schreiber Cannon 10/1/96 13.00 13.0 312.00 10.00 10 .oo 19.00 19.00 16.00 16.00 X X 0.00 0.00 7.00 55.00 18.00 18.00 ......... 106.00 24.00 16.00 2.00 X 1 .so 3.00 2.00 X 0.00 0.00 1 .oo 8.00 I .oo 2.00 0.00 16.00 4.00 3.00 5.00 2.00 0.00 24.00 38.00 38.00 29.00 0.00 84.00 19.00 75.00 18.00 15.00 33.00 0.00 12.00 0.00 4.00 6.00 6.00 4.00 0.00 13.00 2.85 11.25 2.70 2.25 4.95 0.00 1.80 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 ' 0.00 0.00 0.00 15.13 .00 .OO .00 .OO .27 38025.00 29250.00 55575.00 46800.00 20475.00 160875.00 23400.00 38025.00 31 0050.00 70200.00 57275.00 33600.00 16800.00 16800.00 70200.00 I1 1150.00 I1 1150.00 54825.00 !45700.00 j5575.00 !19375.00 $2650.00 13875.00 E525.00 )5100.00 193050.00 3078.25 4255.25 27090.00 27090.00 22575.00 ...... 722400.00 22575.00 3030.00 ..... ( !438.10 !438.10 !438.10 1876.20 '314.30 !438.10 1876.20 1876.20 1876.20 I61 6.95 !438.10 !438.10 !438.10 '2620.1 5 '2845.90 '4110.10 12.00 @ ................... ............ .............. 'tyJ;$g;; j: ..................... 38.00 Affordable Spreadsheet Page2 yellow = projects < 7 units cream = pendinglappr'vdlbuilt It.blue = proposing construct. gold = existing combined prjct Affordable Spreadsheet Ratan. Becker Addison Alcaraz Graben Fisher Dettmer Affordable Spreadsheet Page3 CXI Attachment 3 - RENTAL PROJECT - AFFORDABLE HOUSING ANALYSIS OCEAN BLUFF APARTMENTS, CARLSBAD FINANCIAL SUMMARY OCTOBER 2,1997 180,540 1,304,725 Funding Sources & Uses 1 1 17,086 I Sources: I Tax Credit Investor Equity S I,241,44 1 Conventional Mortgage # 1 AHP Loan 0; Redevelopment Loan - front end 959,000 I HOME Loan 01 DeveloperLoan Construction Period Revenues Developer Loan Deferred Developer Fee Catellus Land Contribution Total Sources Total Uses $2,752,550 i Uses: Property Acquisition - Land Property Acquisition - Imprrnnts Hard Construction Costs A&E/LegaVConsuhants Permits & Fees Developer Fees Reserve Funds MarketinghfodeldOffice Conventional Mortgage Loan Amount: $1 17,086 Housing Set-Aside Amount: $959,000 Credit Enhancement Credit: Not Applicable Term: 10/03/97 Stonomits Other Amount: $0 Pay-in Date: Year 1 Net Operating Income $14,780 Year 1 NOi after 1st TD Debt Service SO Year 1 Net Incorne(Loss) (f96,2531 Developer Fees Contract Mgmt Fees S 160,000 $77,000 Year 1 Ground Lease Income Year 1 Loan Debt Service Year 1 Partnership Management Fee Year 1 Distributions 'inancial Structure 1 Taxcredits Amount $1,358,600 1 Amount: $1,241,441 Construction Loan Lender: to be determined Term: 19 months Security: First Trust Deed Recourse: 50% Repayment Guarantee, Completion Guarantee, Environmental Indemnity Investor: to be determined Pay-in Date: Recourse: Buy-out: 100% occupancy on low income units, and 1.25 x Debt Service Coverage 30 month Operating Defecit Guarantee Equal to Investor's tax liability Issuer: Conventional Mortgage Lender Security: First Trust Deed Term: 30 years LTV: 75.0% DSC: 1.25 x Interest Rate: 9.500% Cap Rate: 8.50% Source: City Redevelopment Agency Pay-in Date: Commencement of Construction Recourse: Special terms: none 100% to partnership upon failure to maintain affotdability Spread: LTV: DSC: Resourse: Rating: i Term: I interest Rate: Security: [DEVELOPMENT SCHEDULE I Number d Units Oenwty Per Acre Start Predwetopment Predevelopent (Months) AcQuislIIon of Land RezoninglAppmval Perlod (MonVu) Project AgpmvsUStart Prored Wgn Wdng Oocuments Penod (Months) Project Finanang Completed Silewo& Perlod (Months) consmcuon Start Construdmn Penod per Phase (months First Phase Completed I Start Leasing Total Construction Perlod (months) Final Cerclficate of Occupancy Tocd Lease-Up Pew (Months) Stabillzed Oaupancy Umts Leased per Month Holding Pcdod (Months) Takeout Finanang Pmpelty Sale 0.689 Mer new predev acg rezone deslgn drawing funds SilewOrk start 1) COOSIT phase1 msIR built leaseup leased ab- hold bkeout 15 ITAX CREDIT ASSUMPTIONS credit Year Federal Tax Credit Rate State Tax Credil Rate Diflicult to Develop % Applicable FracuOn Adjusted Eligible Basis Annual Tax Credits Investor Yield on 99% of Total Credit AllocaUon tnveslor Mer Tax IRR Gros Investor Ccnmution to Lower mer Deferred Pay-In on Tax Credil Equity (Mcnlhs) AffordabUlty Pool Points Credil Utilition Points Rent Burden % 15% target 16 2323 du Jan4 4 May-98 0 May-98 4 Sep98 2 Nov-98 9 Aug-99 9 Aup99 1 *E 0 3 N~v-99 sCp2014 1998 8.65% 0.00% 100.00% 100.000% 2.027.537 175.382 71.50000% 15.07% 1,241.441 15 0 16.128 0.0W 777717 :HUD INCOME GUIDELINES I FMR I UTlUrY I BASIS LIMITS J Fw: SAN DlEGO COUNTY as d. 1 Person 2 Person 3 Penon 4 Person 5 Person 6 Penon 7 PNxn 8 Penon lM7196 w.000 t38.900 543.700 548.600 552.500 356.400 560.300 564.200 OBllY95 Fab-96 0211&97 Fair Markel Utility TCAC ~~~ Non-Elevator $541 S15 74.855 1-BR 5677 S26 90.276 2-BR s1.109 544 128.731 4-BR 5473 S10 64,921 Sludlo $940 US 115.553 5BR Basis Features?: (YN) Y ,RESIDUAL SALES VALUE I Net Operating lncomc - Yr 16 13.601 Gross Sales Value 160.017 Less: SalesExpense 3.00% (4,801) Less: Debt Repayment Capibllzalion Rate 8.50% Permanent Oebl Wanw (94,283) Redevelopmcnt Loan Balance (959.000, Redevelopment Loan Acaued hteresl (431.550) HOME Loan Babnce 0 AHP Loan Bahnw 0 Loan Babnw 0 Land GmVibutlon (252.083) Acuued Partnenhip Mgmt Fees 0 Accrued Asset Mgmt Fees (109,435) Exit Paymenl to Tax Credit Partner 0.00% 0 Residual %to Value 0 ,FINANCING ASSUMPTIONS 1 I Retail CONSTRUCTIONPERMANENT LOANS Construction Mortgage #l MartgaQe 112 Loan #I Conventional CMvmUanal Easa Index Ease Interest Rate Polnl Margin Excess Coverage Credit Enhancement Interest Rale Cap Total Interest Rate Inleresl Rale Cap (7 years) Loan Undenvriting lnlerest Rate Ahilrage Investment Rake 0.000% Loan Points 6 Fees Bond Undenwiting Fees Credit Enhancement Fee Bond Agency Issuance Fee Loan Term (Years) Debt Service Coverage Ratio (DSC) Maximum Loan To Value Ratio (LTV) Cap Rate 1 Yr LIBOR C.I.P. 7.000% 8.950% 0.000% 0.000% 2.000% 2.000% 0.000% 0.550% 9.000% 9.500% 0.000% 0.000% 0.ooO.h 9.~9~ o.ooo9c O.WK 1 .oox 1 .OO% 0.00% 0.00% 30 30 M 125 0.00 0.00 75.0% 0.0% 0.0% 8.50% 8.50% 8.50% Cash Avsilable for Deb1 Serviw DSC LTV 14,780 2.956 0 Project hiaxlmum Dcbt Capacity 1.25 67.4% 117.160 0 0 UnderwriUng Dcbt Sedce Limit 11.824 0 0 Total Permanent L~an Required 125 67.3% 117.088 0 0 Total Annual Payment 11.814 0 0 OTHER DEBTILOANS Interest Rate Loan Points 6 Fees Loan Tm (Years) Dewloper Acauisition Redevebpmt Loan 0.00% 3.00% 0.00% 0.00% 0.00% 0.00% 55 0 Ground Lease SO LandEasis 0.00% RetwronBasis !SOURCES AND USES OF FUNDS Rosldmtlal Commdcal TOTAL! 100.0% 0.0% Property Acquisition - Land Prwrty Acquisition - Imts Hard Cwtruction Costs AhEn.egaconsultants Permits 6 Fees Oweloper Fees ReSeNe Funds MarkeUng/McdelJnMlce Financing 6 Other Sot7 Costs ConUngency 15.755 11.z(u 81.545 12.m 1a.7lu 1o.m 1 .Mo 2.1w 11.801 6.194 Total Project Usa 172.0% SOURCES: Tax Credit Investor Equity ConVenlianal Martgaw x1 Conmltional Moltgage xz HOME Loan AHP Loan Redcwlopmcnt Loan - fmnt end OeveloperLoan Construction Pcrlod Rwenuo Oevelopcr Loan Deferred Davetoper Fw Catenus Land Contribution - 77.590 7.318 0 0 0 50.958 0 150 0 0 27.030 - TOM Proled Sources 172.0% Construction Loan CMMlihmt Requlred Local Subsidy Required Local Subsldy per Affordable Unit Total Bedrooms Required LOCal Subsldy per BR Local Subsidy as % of Total Costs 252.083 180,540 1.304.725 201.607 300.236 160.oOo 24.000 40.000 190.254 99,105 0 0 0 0 0 0 0 0 0 0 - 252.083 180.540 1.304.725 201,607 500.236 1 60.ooo 24.000 40.000 190.254 59.105 2.752.550 0 2.752.550 9% .¶.on 7.3% 10.m 5.8% 1.5% am 3.8% 47.4~ 0.m 82,763 1.241.441 0 1241.441 117.086 0 117.086 0 0 0 0 0 0 0 0 0 0 0 bl.033 959.m 0 959.000 0 0 0 00 2,400 0 2.400 0 0 00 0 0 0 0 432,623 2,752.550 0 2.752.550 432,623 1391.623 92.775 41 29.809 50.56% I I Anordrbl.m 101oM7 UNIT RENT ASSUMPTIONS 93.75% 8.25% 01:18 PM 80.00% 0 0 0 0 0 0 0 0 Market I 0 0 0 0 0 0 0 0 Total Units 1 5 5 5 0 0 0 0 Oi % 6.3% 31.3% 31.3% 31.3% 0.0% 0.0% 0.0% 0.0% 0.0% I [UNIT MWAFFORDABILITY BENEFIT ANALYSIS Man Unitr 0 0.0% 1 8.3% 16 40.0% 1- Related Residentlal SF Community Centeflr) Leasing OfKce Fitness Center Laundry Retail Commercial SF TOTAL SQUARE FEET 800 0 0 60 0 a sq. n IMARKET RENTAL RATE VALUATION 2EEumMa-30BL2EA- .To(aVAva. asf RENTS: Standard Rent 0 850 1 .m 1,080 0 0 0 0 0 918 viaw Premium 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0 Adjusted Rent 0 871 1,025 1.107 0 0 0 0 0 938 % Anordability 0.0% 73.3% 77.3% 75.6% 0.0% 0.0% 0.0% 0.0% 0.0% PSf $0.00 $1.00 50.95 $0.88 $0.00 50.00 50.00 $0.00 $0.00 SO.89 Inflation Premium 2% 2% 236 2% m 236 2% 2% 2% to.00 $1.02 $0.97 $0.90 $0.00 $0.00 $0.00 $0.00 $0.00 $0.91 Potential Market 0 52.280 81,500 68.420 0 0 0 0 0 $180,160 $0.91 Proforma Rents 03.748 W.42 PSf Affordable Rent Reductton 68.432 \OPERATING CASH FLOW - ARER RESERVES lntlatkn Index (yh) Y Income Inflator 2.50% Expense Inflator 3.50% Base Year 1998 Cwtruaion Inflation Index 0 Stabilized Inflation Index 1 YR 1 YR 2 YR 3 YR 4 YR 5 YR 6 YR 10 YR 11 YR 15 YR 18 Net Rental Income 82.485 04.547 88.861 88.828 91.048 93.325 103.013 105.5118 ll6.ssO 119.463 ._. - _...._ OperaUng Expense (58,328) (e0,Nl) (821341) (64.450) (eSk2) (68:688) (78,710) (81.379) (92:999) (96:lg) NO1 3 14 780 14 541 14 615 14 872 14 731 14 597 14 504 13 845 13 601 Reserves (9,377) (9.708) (9,708) (9.706) (9,706) (9,706) (9,708) (9,708) (9,706) (9,706) 1st TD Mortgage Pmt (11.814) (11.814) (11.614) (11.814) (11.814) (11.814) (11.814) (11.814) (11.814) (11.814) Other Debt Service 0 0 0 0 0 0 0 0 0 0 Ground Lease pmt 0 0 0 0 0 0 0 0 0 0 2nd lD/other fees (2,966) (2,727) (2,801) (2.858) (2.897) (2.917) (2.783) (2.690) (2.031) (1.787) Cash for distrib. 0 0 0 0 0 0 0 0 0 0 [PARTNERSHIP ALLOCATIONS Oevrlopmt Partnnhlp Tu Oweloper Cash Opentlng Sales TU ~~QBdh EruolztrlbuUon-m- Tax Credd (Ltd) 99.00% 99.00% 99.00% 99.00% Developer 50.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% Non-ProFn (GP) 100% 50.00% 1oo.oox Invertor (Ltd) 0% 1 .W% 1.00% 1 .OO% 1.00% 100.00% 1.11 .c D nu ams 1.10 M w W OM 0.0 Id w 44 17.- M sm 1L.m M m.m n 44 ou ou am4 am am mam4 OM &an OM 0.W UJII M 1.001 1.001 1.00 u L0o)U lam u am 4mhn mm u 0 1m.00 0 44 0 0 0 Q 0 n.00 tam 1.171 O l.m sm QU U nu nu 0m U 0.001 u nu lo.m u 4.m4 4.m n.00 u Y10 M ou QU #.an am 0 WIIlD 0.000 10.00 0 10.00 LOIS a* 7,015 WW 0 0 O.m 0 OCEAN IFF APARTMENTS, CARLSBAD //NET OPERATING INCOME Income Inflator Expense Inflator InflaUon Index 2.50% 1 STABILIZED 3.50% 1 YEAR 1 1 .oooo RENTAL INCOME: Gross Potential Rent Credit CheckRate FeesRaundry Retail Revenue 0 Vacancy Allowance - Residential Vacancy Allowance - Retail Net Rental Income OPERATING EXPENSES: General & Administrative: Advertising Leasing & Commissions Legal Accoun tingJAudiURecerts Security Office Supplies 8 Expense Property Management Fee Utilities: Fuel Electricity Gas Telephone Water and Sewer PayrolVPayroll Taxes: Manager Assistant Manager Community Coordinator Leasing Agent Maintenance Supervisor Maintenance Personnel Security Personnel Payroll Taxes/Workers Comp Health Insurance Maintenance: Painting & Decorating General Repairs Trash Removal Exterminating Building & Grounds Maintenance Elevator & Other Equipment Facility Services TOTAL VARIABLE EXPENSES Taxes & Insurance Property Tax Assessment Other Tax Assessments Partnership Taxes Property Insurance Unsubordlnated Ground Lease: TOTAL FIXED EXPENSES TOTAL EXPENSES NET OPERATING INCOME: $5.00 lunit $0.00 lsf 5.00% 10.00% 5,030 /unit $25 lrno $0 lrno $125 Imo $292 lmo $0 Imo $100 Irno 8.35% of NO1 $0.00 lunitlm $14.00 lunitlm $12.00 lunitlm $100 lmo $29.00 IuniVm $750 Imo $0 Imo $0 Imo $0 /mo $0 Irno $500 Imo $0 /mo $80 Imo $3.00 IuniVm $7.50 lunitlm $15.00 Iunitlrn $2.00 IuniVm $25.00 lunitlm $0 lrno $0 lrno 20.00% $3,376 Unit $0 lunit $0 Imo $0 lrno $150 /unit $0 Imo $150 Unit $3,526 Unit Reserves: Replacement Reserve $489 /unit Operating Reserve SO lunit Other Reserves 21,071 $77 /unit TOTALRESERVES 18,502 $566 Rlnit 0.60% of hard costs or NET OPERATING INCOME (Incl. Reserves): 85,842 985 0 (4,341) 0 82,485 31 1 0 1,553 3,623 0 1,242 6.888 0 2,782 2,385 1,242 5,764 9,315 0 0 0 0 6,210 0 3,105 994 596 1,490 2,981 397 4,968 0 0 55,844 0 0 0 2,484 2,484 58,328 24.157 8.102 0 1,275 9,377 14.780 CODE 1000 1500 2000 2300 2500 3000 3900 4000 5000 5900 6000 6800 7000 8000 AFFORDABLE HOUSING ANALYSIS OCEAN BLUFF APARmNTS, CARLSBAD MASTER BUDGET BREAKDOWN CONSOLIDATED SUMMARY OCTOBER 2,1997 DATE REVISED [UNITS 16' /ACRES 0.689 1 BUDGET SUMMARY DESCRIPTION Property Acquistion Permits and Fees Offsite Improvements Common Area Engineering Onsites - Direct Lot Improvements Construction Indirects Project Development Overhead Financing Property Taxes Model / Sales Complex Sales and Marketing Contingency I I TOTAL s:\projec~~~anhou\oceanblu\9_29_97.~4 APPROVED BY: PER SF 25.15 17.46 1.03 0.00 2.27 40.00 16.28 14.07 9.45 13.78 12.46 0.00 0.87 1.45 5.76 160.03 Project Manager Division Head PER UNIT I TOTAL BUDGET I 27,039 18,765 1,108 0 2,438 43,000 17,500 15,125 10,163 143 13 13,391 0 93 8 1,563 6,194 432,623 300,236 17,725 0 39,000 688,000 280,000 242,000 162,607 237,000 2 14,254 0 15,000 25,000 99,105 I 172,034 I 2.752.550 Finance Construction Marketing w w w w w w . e 0 0 e eu 0 e e . e e e . I 0 e e e * . I 0 ISM# 'se e . 0 0 0 I 0 e 0 e e m I 0 e 1w u Ima e e e e I e e 0 e YW IO Y 1y eu 0 m 0 0 e e 0 0 e e e e e Ud e 0 e 0 m . 0 eu m * . e 0 . e * e e e . IP. I e 0 0 e ern a e e I e e e e . e 0 e e r I 0 e 0 " lCU 0 0 * * . . m . 0 * 0 m 0 0 m * . * 0 m * 0 e e e 0 m 0 0 . I 0 e . m . * . 0 e IJILYI * IYI inu m m * * 0 0 * 0 0 ,a m 0 e 0 * 0 * m 0 1.- 1.- 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1.mT 1.- 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1.m l.mm0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 t.oDu 1.- 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1.01153 I.mm0 0 0 0 0 0 0 0 0 O 0 0 0 0 0 0 0 O 0 0 0 0 0 0 0 0 0 1.01m lDDm0 0 0 0 O 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 lDBn I.mm0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 .o 0 c 0 0 0 0 0 0 0 1 .opzD I.mm0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 (.-I4 1.- 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 O 0 O 0 0 0 0 0 0 1.- I.mm0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 t.opD( 1- 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 rn 0 0 0 0 0 0 0 0 0 0 0 0 nit 0 0 0 0 0 0 0 0 0 0 0 0 s7.m 0 0 0 0 0 0 0 0 0 0 0 0 $1- 0 0 0 0 0 0 0 O 0 0 0 0 PLI 0 0 0 0 0 0 0 0 0 0 0 0 m 0 0 0 0 0 0 0 0 0 0 0 0 m 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 PO7 0 0 0 0 0 0 0 0 0 0 0 0 w 0 0 0 0 O 0 0 0 0 0 0 0 m 0 0 0 0 0 0 0 0 0 0 0 0 m 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0' 0 0 0 0 0 0 0 0 0 0 0 0 0 O 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 O 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 m.o+ 0 0 0 0 1 i3 a n n n n n an 0 0 0 0 0 0 0 0 2 2 I 2 224% hm k hm 111 k k - MYII.. - k - k k k k k hm hm h M hm k M 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 a a 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 a 0 0 0 0 0 0 0 0 0 0 0 0 0 a 0 0 0 a 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 a 0 0 0 0 0 1.- l.mD00 0 0 0 0 0 0 0 0 0 0 0 0 117 0 0 O w 0 I7 a zn 0 0 0 0 a 0 0 0 0 0 0 7.011 1.016IO 1.08oO 21 0 IY p? 0 (10 a4 0 Ut 212 110 512 W 0 0 0 0 %I 0 m 1 0 0 81 a a 0 1z Tu u UI a 0 1.OOmr l.Oo(10 0 0 0 0 0 0 a 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 a 0 0 0 0 0 0 0 0 0 0 0 m 0 0 0 0 0 0 Io 0 0 0 0 0 0 0 0 0 0 0 0 U.=l 0 0 0 0 0 0 1.- 1.- I.= IW e w 0 0 0 0 0 0 0 w ai (II 05 0 Po 0 0 0 0 0 a 0 0 0 0 0 0 m 0 0 0 0 0 0 0 1- io) 10) IOI 0 rt.m - I RUN DATE: 10/03197 ' RENTAL INCOME ASSUMPTIONS 1 Family Medhn 35% 40% 45% 80% 100% I Sbe Income of Median of Medlan of Median of Medlan of Median 38.900 43.700 48.600 52.500 58.400 60.300 64,200 1 1,900 13.015 15.295 17,010 18.375 19,740 21,105 22.470 13,gO 15.560 17.480 19,440 21 .OOo 22.560 24.120 25.680 15.300 17.505 19.885 21.070 23.625 25,380 27.135 28,890 27.200 31,120 34.960 38,880 42.000 45.120 48,240 51.360 34.OoO 38.900 43,700 48,800 52.500 58.400 60.m 64.200 I Maximum Net Net Family Number Monthly UUlity Monthly Annual Unit Total RrnU Sh Unlt Type of Units Rent Allowance Rent Rent Sq. Ft. Sq. Ft. Sq. Fy % of Medhn 35.00% 35.00% 35.00% 35.00% 35.00% 35.00% 35.00% 35.00% 35.00% 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 45.00% 45.00% 45.00% 45.GQ% 45.00% 45.00% 45.00% 45.00% 45.00% 80.00% 80.00% 80.00% 80.00% 80.00% 60.00% 80.00% 80.00% 80.00% Market Market Markat Markel Market Market Market Market Market 2BRIZBA Mgr ZBRJ2BA 3BRIZBA 4BRIZBA 0 1 2 2 0 0 0 0 0 0 2 1 2 0 0 0 0 0 0 2 2 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 TOTAL PROJECT 10 RELATED RESIDENTIAL SPACE Community Center($) Leasing Ottb Fitness Center Laundry Total Related ResldenUaI Spa- TOTAL PROJECT RESIDENTLAL SQUARE FOOTAGE 381 381 441 493 0 0 0 0 0 436 430 505 583 0 0 0 0 0 491 491 588 634 0 0 0 0 0 673 873 1.010 1.127 0 0 0 0 0 0 850 1,000 1,080 0 0 0 0 0 20 0 20 355 35 406 44 449 0 0 0 0 0 0 0 .o 0 0 26 0 26 410 35 470 44 519 0 0 0 0 0 0 0 0 0 0 20 0 20 485 35 533 44 580 0 0 0 0 0 0 0 0 0 0 20 0 20 847 35 975 44 1.083 0 0 0 0 0 0 0 0 0 0 0 0 0 850 0 1,000 0 1,080 0 0 0 0 0 0 0 0 0 4.260 9,744 10.770 0 0 0 0 0 0 9,840 5,640 12.456 0 0 0 0 0 0 11.160 12.792 7.080 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 850 850 1,058 1 ,m 0 0 0 0 0 850 850 1,058 1.226 0 0 0 0 0 850 650 1.058 1,220 0 0 0 0 0 650 850 1.058 1.226 0 0 0 0 0 850 850 1,058 1,226 0 0 0 0 0 $0.00 850 $0.42 2.110 $0.38 2,452 $0.37 0 $0.00 0 w.m 0 $0.00 0 50.00 0 50.00 0 8.W 1,700 50.48 1.058 $0.44 2.452 $0.42 0 50.00 0 $0.00 0 t0.m 0 $0.00 0 $0.00 0 $0.00 1,700 50.55 2.110 50.50 1,220 $0.48 0 so0.00 0 $0.00 0 $0.00 0 50.m 0 $0.00 0 $0.00 0 $1.00 0 $0.82 0 t0.m 0 $0.00 0 $0.00 0 $0.00 0 $0.00 0 t0.m 850 $0.00 0 $1 .OO 0 $0.95 0 50.88 0 $0.00 0 $0.00 0 50.00 a 50.00 0 0 0 0 0 50.00 -/ 83 748 1075 10.520 - $0 .41 800 0 0 80 680 1 7.200 - + TS 6 flNANClNG - PART Vlll CTCAC APPUCATlON ioo.oax 0.00% NON- DEPRECIABLE BASIS TOTAL IDNELOPMENT COSTS TOTAL PER UNIT DEPRECIABLE RESIDENTIAL NON-RESDNT AMORTKED EXPENSED RESIDENTL Land Cor1 LegaVBroker FewTUe Off-Sile Improvements Demdilion Exisling Improvements Value Total Acqulsltlon Costs v Sile Wcd Slruclurar General Requirements COnlraclOr Overhead Contradw Rofll - Design supervisicn P P Construction Loan Interat AcquidUan Loan lnlarsst Loan Originaum Fee Properly Tu- Ground Lease Paymcnll Cwtrwuon Pa Inrum Cwtruction Inspection Feed VUe 6 Rscordlng Total New Construction Costs Total Archltectunl Costa Total ConstructJon Intonst 6 Foes - Loan Orlgbticn Fee Cmdil Enhancement and Application Fee VUa 6 Recording kmL&as LMdW Legal Costs Paid by Appllcsnl L-I- Real EJLale Legal - SyndlaUon R.rclrvu Rent Rema Olhff Total Pernunant Flrunclng Costa Total Anomy COSD Total Rant Rosorvo Costs - Local Pecmil Fcer Marketing Furnishings CapiW Fees OpcnUng ShctUaD son cos( conunpency Total 0th~ Costs TOTAL PROJECT COST - Owelopar Gverheadmrdt CwullanVPrcccuing Agml Fees Project Admirwhtian Olhff Total Dewlopar Costs TOTAL PROJECT BASIS Tax Credit Cwulhnts SyndicauOn AcaxlnKng/Audiling Total Non-hsls Costa TRUE PROJECT COST - Proled Subsdies 432,623 27,039 432.623 0 0 0 0 432.623 0 0 0 0 0 0 0 0 17.725 1.108 17.725 0 0 0 0 17.725 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 450.348 28,147 450,348 0 0 0 0 450.348 280.000 17.500 0 280.000 0 0 0 280.000 688,000 43.000 0 6ea.000 0 0 0 688.000 182.000 11,375 0 182.000 0 0 0 182.000 60.000 3,750 0 60,000 0 0 0 60.000 77.000 4.813 0 77.000 0 0 0 77.000 1.287.000 00.438 0 1,287.000 0 0 0 1,287,000 106.000 6,625 0 106.000 0 0 0 106.000 0 0 0 0 0 0 0 0 106,000 6.625 0 108,000 0 0 0 106.~ 39,060 2.438 0 39.000 0 0 0 39,MX) 68.800 4.w 0 29.958 0 0 38.842 68.800 0 0 0 0 0 0 0 0 13.588 849 0 13,596 0 0 0 13.588 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 24,107 1.507 0 24.107 0 0 0 24.107 4.400 275 0 4.400 0 0 0 4.400 10.000 825 0 10.000 0 0 0 10,000 3 120.893 ,556 0 0 0 38.042 120 893 2.171 136 0 0 0 2.171 0 2,171 0 0 0 0 0 0 0 0 10,000 625 0 0 0 1o.Ooo 0 1o.ooo 12.171 761 0 0 0 12,171 0 12.171 5o.ooo 3.125 0 50.m 0 0 0 s0.m 5.000 31 3 0 5.000 0 0 0 5.000 0 0 0 0 0 0 0 0 55.000 3,438 0 55.000 0 0 0 55.000 24.000 1.500 24.000 0 0 0 0 24.000 0 0 0 0 0 0 0 0 24.000 1,500 24.000 0 0 0 0 24.000 5.000 313 0 5,m 0 0 0 5.060 61,386 3,537 0 61.u16 0 0 0 61.386 14.575 91 1 0 0 0 14,575 0 14.575 0 0 0 0 0 0 0 0 Joo.236 18,765 0 3M1.234 0 0 0 300,238 25.000 1.563 0 0 0 25.000 0 25.000 15.000 938 0 15.000 0 0 0 15.000 0 0 0 0 0 0 0 0 1.722 108 0 1.722 0 0 0 1.722 37,719 2.357 0 37.719 0 0 0 37,719 394,252 24,641 0 354,677 0 39.575 0 394.252 2.555.050 159.691 474.348 1.990.114 0 51.746 38.842 2.555.050 160.000 10,OoO 0 160.000 0 0 0 160.000 26.500 1.656 0 26.500 0 0 0 26.540 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 186.500 11.656 0 186.500 0 0 0 186.540 2.741.550 6 171 347 0 10.000 825 0 0 0 10.000 0 10.000 0 0 0 0 0 0 0 0 1,000 63 0 0 0 1 ,000 0 1 ,000 11.000 688 0 0 0 11.000 0 11.000 62 746 38842 2752550 2.752.550 172,034 474.345 2.176.614 0, , .., 0 0 0 0 0 n a 0 Othu Bass Reduction 0.ow 0 0 0 0 0 0 0 0 Total Basls Roductbrn 0 0 0 0 0 0 0 0 NET PROJECT BASIS 2 , 752 , 5% 172 , 034 474.348 2.178.614 0 62 . 746 3.3642 , 2752550 , , 4 - ~ALSBAD RUN DATE: CTCAC TIEBREAKER CALCULATIONS Threshold Average Affordability: Proposed Average Affordability: less 56.000% 39.872% Amount Below Threshold 16.128 Points (Maximum of 16 Points) 16.000 - San Diego County Threshold Basis Limits - Non-Elevator (02/18/97) 2BFU2BA Mgr 2BFU2BA 3BR12BA 4BW2BA Total Net Project Basis Requested Eligible Basis Credit Utilization Points TCAC's Basis Limits x # Units !uEeams- TCAC's #uhiks 16 90,276 90,276 115,553 128,731 0 0 0 0 0 90,276 451,380 577,765 , 643,655 0 0 0 0 0 1.763.076 2,176,614 103,817 103,817 132,886 148,041 0 0 0 0 0 103,817 519,085 664,430 740,205 0 0 0 0 2,027,537 2,176,614 2,027,537 0.000 - I RUN DATE: 10103197 TAX CREDIT CALCULATIONS Jax Credits Iatal Federal State Preliminary Eligible Basis 2,027,537 2,027,537 Deductions from Eligible Basis: Grant Proceeds Used to Finance Costs in Eligible Basis Federal Loans Used to Finance Costs in 9% Eligible Basis Non-Qualified Non-Recourse Financing Non-Qualifying Portion of Higher Quality Units Historic Credit (Residential Portion Only) Total Deductions from Eligible Basis Total Eligible Basis 0 0 0 0 0 0 0 0 0 0 0 0 2,027,537 2,027,537 High Cost Area Adjustment Total Adjusted Eligible Basis Applicable Fraction Total Qualified Basis Tax Credit % Total Annual Tax Credits LP Share of Credits Credits Available to Equity Provider Credit Period Total Credit Allocation Investor Yield Gross Investor Contribution Less Lower Tier Syndication Expenses: Legal - Syndication Syndication Consulting Syndication Accounting Total Syndication Expenses Syndication Expenses funded from Construction Loan: 100.00% . 2,027,537 2,027,537 1 00.00% 100.000% 1 00.000% 2,027,537 2,027,537 8.65% 0.00% 175,382 0 1,753,820 99.00% 99.00% 99.00% 173,628 0 1,736,281 10 1 1,736,281 0 1,736,281 0.715000 0.71 5000 0.71 5000 1,241,441 0 1,241,441 10,000 0 10,000 0 0 0 1,000 0 1,000 1 1,000 0 5 (1 1,000) 0 (1 1,000) Net Investor Contribution 1,241,441 0 1,241,441 /[OCEAN BLUFF APARTMENTS, CARL, >AD RUN DATE: 1 0103&7q~ I IkAX CREDIT INVESTOR ANNUAL RETURN Yeat 1 1998 2 1999 3 2000 4 2001 5 2002 6 2003 7 2004 8 2005 9 2006 10 2007 11 2008 12 2009 13 2010 14 2011 15 2012 16 2013 17 2014 18 2015 19 2016 Tax Credit Partner investment (1 5,000) (1,226,441) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Federal 0 173,628 173.628 173,628 173,628 173,628 173,628 173,628 173.628 173,628 173,628 0 0 0 0 0 0 0 0 state 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 40.00% Tax Savings f.anhsB 82 32,876 35.463 36,823 35,704 34,828 34,145 34,042 33,283 32.580 32.519 32,452 32,379 32.298 32,209 29,439 0 0 3,188 Asset MclmtFee 0 247 2,946 2,733 2.806 2,861 2.899 2.91 7 2.91 5 2,892 2,846 2,776 2.680 2,557 2,406 2,224 1,862 0 0 IPIBL (14.918) (1,019,789) 210,859 212.091 21 1,015 210.173 209,555 209,523 209,419 208.646 207,916 24,185 34.060 33.913 33,741 33,543 30,556 0 0 20 2017 0 0 0 0 0 0 0 0 0 TOTAL (1,241,441) 1,736.281 0 535,310 40,565 (4) 0 (16,225) 1,054,487 I RR 15.07% fd Dqf !4 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 !i & 000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 8 Oo0 O!iOOO 000 0 000 B Oo0 O35OO0 Oo0 oiooo Oo0 o$ooo Oo0 O!4Oo0 Oo0 Ojoo0 Oo0 offooo 000 0 000 JF 000 0 000 4 Oo0 04000 Oo0 OJFOOO Oo0 035000 Oo0 Oioo0 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 5 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 4 0c-00 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 00000 35 g' 8 ~0000~?a n - -. . n ' 3 coooooo 5% 5 IO $ .I fOOOOOO I t O0 n O0 g z; 0 0 n f zz r: ff O0 f :z 8. O0 0 Attachrylient 4 w 1 cf) CIC 0 LL a ci 0 I OOO/O' 000000 0 0000000000/ 0 001 0 0 I ~ HI , 1 os0 Y) Is I ii 1 os0 '9 0 I I I I 000 0 3=oooc13 0000000000 0 os0 yt 2 I I ' I I I I '0 I I I 1 I 000 0 3=oooc13 0000000000 0 000 0 yt w os0 2 'Z u1 dl I I 00 0 0 w f n OCEAN BLUFF CONDOMINIUMS. CARLSBAD 0%11 PM PROFORMA ASSUMPTIONS gCTOBER 2,1907 S:WROJECTI\URBANHO(OU\OCEANBLU\CONOOS 2.~4 1 Total Unils 8 8 0 0 0 0 0 0 % Mii 50.0% 50.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% !PROPERTY SUMMARY i 16 1w.ox NumW of Unib Acres 0.402 Ne1 16 uniU 0.689 wou Density efIlciency 39.8 du 23.2 du 58.33% LDEVELOPMEM SCHEDULE Projea Commencement Year Sbrl PreQevelopmenl PreQeveloml (MOnlhS) AcquisiUon of Lana Financing Period (Manlhs) Project Financing Completed Silewcrk Perlcd (Monms) Finish Sitework I Sbrl Welr Lag barn Models 6 Phase t Smt Stan Phase I Unit CanslruccMn Total Conslrunion Phases Monms per Conslructian Phase TOM Conslrunion Period (Monlhs) CompletiWCerUflcale of Occupancy Sbrl of Sales Unit Sales per Monlh McnvU per Sales Phase Total Sales Period (Monlhs) Property Sell-oul oinim new oinim ~tarl 4 predev 05/01/98 acq 4 lnance 06/01/98 fun- 2 silermlr 1lRlME models 0 11101M prusel 1 phase¶ 0 phase 9 mnsv O&Ql/W finish omM12n)o sell 8.0 8.0 aosaro 2 2 sale¶ lWlli3Q sellout [SOURCES AND USES USES: Property ACsWsibM - Lana Property Acqulwtion - Irnpmvmnts Hard Consuuction A6Megal/Ccnsultan~ PermiU 6 Fees OBvelOpetOv&ead Malretlng Cos& Financing 6 Omer ScR Cos& SOURCES: Conslrucbon Loan MalreUng tosls paid in Exnm CaWlus Land CcntrlbuUca E~uily - up hont Finanaal Partner Equily - msb: mataing Land Owner Conlnbubon -up fmnt ReQeveIapmenl Sel Aside - up hunt Total ConrbuctJon Sources ReQeveIooment Set Aside - hack end Total Projwt Usas Land ManlbrabMl €Wily - conslrucam matchtng eE€urld 15.755 1 1.284 85.032 15.224 c9;700 9.883 IpBl 252.083 180.540 1,360.51 1 243.580 315.193 15B.lZ? mi 15.00 10.75 80.m 14.50 18.76 9 H _. . . 9,405 150;474 8.98 5,521 88.331 5.26 171.802 2.748.835 163.62 17% LTV 1.452.903 58,309 432.823 0 0 0 0 0 0 0 0% 0 0 50.313 805.000 2.748.835 0 0 Q% .. Equily Rewpent lo 0 Total Project Sours- 2.148.835 Agency HDmebuyer Downpayment Assistance 0 0 0.00% Total Redew(cpment Agency Pamapa(i0n 50.313 805.Mx1 [FINANCING ASSUMPTIONS 1 ISALES EXPENSE ASSUMPTIONS I ;HUD MEDIAN INCOME GUIDELINES ALE Loan Interest Rats 0.00% Broken COmmiul~S Consuucclon Loan lnlerest Rate 7.81% Esww Clcring Cos& LIBOR -e mu. S.81% Talufer Tax Poinl Margin 2.00% Wrranly Resewe excess covetage 0.00% Litigalion Rmem Conslrudon Loan Polnu 6 Fees 1.00% 0.00% W OlEGO COUNi'Y. effecthe 0- 27, io86 wn I- Family Size: S2.soo 1.10% 1 Perron s34.m so 2 Pmn uB.m 0.00% 3 Pmn Sr3.700 4 Panan 548.600 Maximum Loan lo Marl(e4 Value Maximum Loan 10 Tab1 Cost 85.0% LTC HOMEBUYER FINANCING ASSUMPTlONS i Conslruction Loan Payoff Premium 110.0% 85.0% LTV Mo(1Qaae Loan Interest Race 7.75% 5 Psnon s52.W 6 Psnon 556.400 7 Penon f60.300 8 Penon a4200 Appraised Value per Unil so so so so so so so so Avg. Premium per Unil 0 0 0 0 0 0 0 0 AQjusleQ Appraised Value so so 8 so so so so so [PROJECT PROFKABIUTY eLBbll eLBcu eLBbll w IQIALc4aa.d 50% Affarclabla (vecy low) so so so so so so so SO 8 so 0 0 l.W.*u) 104.028 75%Mardable (law) 95.402 112.654 0 0 0 0 0 0 0 0 0 0 0 0 0 0 UNIT SALES PRICE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Redevelopmen1 Roceeds (uphont or tuck&) Ton1 Pmjecl OeveIopmenl CosU (1- Deveropar Ovemad) Developer Overhead 6 Conbacl Muragemen1 Fees Prefened Rehlm PaymenU PROJECT SURPLUS (SHORTFALL) PROFIT Prqecl Pmfil x S1,237.623 77.351 (S2.590.713) (16l.Om) (ft56,lZZ) (9.8631 so 0 $153.234 9.577 921% CONSTRUCTION ASSUMPTIONS I Total Units 8 a 0 0 0 0 0 01 % 50.0% 50.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%; ,CONSTRUCTION I SALES PHASE TIMING 18 units CONSTRUCTION Duration stad EiDish[months) Sitework og/oim 11~1190 2 Models iirniiga oamiiw 9 Phase 1 iimm oa~oimg 9 Build Out Total 09/01/98 OaIOlI99 11 SALES Duration stad Einisb(monVlsl Models 08/02/99 0 Phase 1 08/01/99 10/01/99 2 Build Out 08/01 I99 1010 1 199 2 oa/omg io101199 2 [HOMEBUYER AFFORDABILITY ANALYSIS I wwww Bedmms 2 3 Bathmoms 1 .o 2.0 Maximum Family Size (Persons) 3.0 4.5 0.0 0.0 0.0 0.0 0.0 0.0 Median Income Level 43.700 50,550 0 0 0 0 0 0 Mortgage Calculation 2 75% Affordable Sales Price 95.402 112,654 0 0 0 0 0 0 Downpayment Assistance 0 0 0 0 0 0 0 0 Buyen Cost 95.402 112.654 0 0 0 0 0 0 Homebuyer Downpmt (4.770) (5,833) 0 0 0 0 0 0 Mortgage Amount 90.832 107,021 0 0 0 0 0 0 Mortgage 7.75% 849 787 0 0 0 0 0 0 PMI 0.55% 44 52 0 0 0 0 0 0 Hazard Insurance 0.04% 3 4 0 0 0 0 0 0 Properly Taxes 1.10% 87 103 0 0 0 0 0 0 Homebuyer Monthly Costs HOA dies 120 120 0 0 0 0 0 0 Total Monlhly Cost 904 1,045 0 0 0 0 0 0 Affordability Calculation Total Annual Cost 10,844 12.544 0 0 0 0 0 0 Houslng Cost Coverage 33% 33% 33% 33% 33% 33% 33% 33% Supportable Income Level 32.860 38.013 0 0 0 0 0 0 % Affordability 75.20% 75.20% 0.00% 0.00% 0.00% 0.001 0.00% 0.00% CODE 1000 1500 2000 2300 2500 3000 3900 4000 5000 5900 6000 6800 7000 8000 AFFORDABLE HOUSING ANALYSIS MASTER BUDGET BREAKDOWN CONSOLIDATED SUMMARY OCTOBER 2,1997 OCEAN BLUFF CONDOMINIUMS - CARLSBAD DATE REVISED ACRES 0.689) UNITS 16, BUDGET SUMMARY DESCRIPTION I PERSF i Land Bonds and Fees Offsite Improvements Common Area Engineering Onsites - Direct Lot Improvements Construction Indirects Project Development Overhead Financing Property Taxes Model / Sales Complex Sales and Marketing Contingency Land Owner Contribution 25.75 17.87 1.06 0.00 2.32 45.00 16.67 14.40 11.49 9.41 4.72 0.28 1.49 7.04 6.12 (25.75 I TOTAL I 137.87 s:\projecu~urbanhou\occanblu\condar_2.~k4 APPROVED BY: Project Manager Division Head PER UNIT ~ TOTAL BUDGET 27,039 18,762 1,108 0 2,438 47,250 17,500 15,125 12,061 9,883 4,960 297 1,563 7,394 6,423 432,623 300,184 17,725 0 39,000 756,000 280,000 242,000 192,98 1 158,122 79,367 4,758 25,000 1 18,309 102,766 (432,623 Finance Construction Make ting wou*L I 1 1 4 r * 1 8 b 1s 1% U .mu WOM MI.CYYIIWUWU u*wIuII.ry O.UYIYM loooot - 1uJmI.m lunu 4 4 4 4 ?e.uoo 0 4 4 4 0 4 4 (Moo1 Lr*-.- OM 4 4 4 0 4 0 4 4 4 4 4 4 0 lWI4 kdrrc.pm*k U 4 4 0 4 4 4 0 0 4 4 0 4 IMOII h.arH.rk 4 0 4 4 4 4 4 4 0 0 0 4 4 nlaa -Dm U 4 0 4 4 4 4 4 0 4 4 4 4 4 4 0 4 0 0 4 0 0 4 4 0 0 4 IOMmWbanwa n.mM rqrn 4 0 0 4 4 4 4 Iooool kLna,&.- WM M Irn.360 4 0 4 4 iaso 4 4 4 4 4 4 4 440% 4 0 4 0 4 UZQ twa Wr-.w- U (SI100 -br-urvn rn lL4N M 27- 0 a 4 0 " .,.,a ,,a- . -.. .- IbllCd Cmrbh(p.0 ita I* saw 4 4 4 0 4 4 4 4 1.84s 44- 0 4 SI- Cmrblww-) U 4 4 4 4 4 4 0 4 4 4 0 4 4 4 4 0 0 4 0 4 0 4 0 0 0 0 4 4 0 0 4 0 4 0 2.251 r2.w Ibl- kubkwhml OM 11" ** 1m 11.048 0 0 lam M ~ILI~P 4 0 4 4 4 0 0 4 47JN m? 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YPI 4 4 4 4 4 4 4 4 4 4 4 0 4 4 0 0 4 4 4 0 4 4 4 4 4 0 0 4 0 4 4 0 0 0 42ma lcDmD--, OM Mcmnsr 1.40% s.nr YUIIW 1.m w I24a 4 4 4 0 0 0 4 0 0 o im sa mi& moan wn lI1PIM L7U.IY 4 4 0 o u.ni a~jas mas -.?as (am w.m ta,uf IQ.~ TU lam m- -- L74auLI 4 4 4 4 ani xias =.IS mm 1.18 y1.m wm turn mun-wnunuraununi 4 0 4 4 4 0 4 4 4 4 0 0 4 4 4 4 4 4 4 4 4 4 - C- -(-#de=-.) 4% 0 4 4 0 4 4 4 0 4 0 4 0 4 0 4 0 0 4 4 4 4 4 4 0 4 4 4 was =.in =*.IS 1.1s i.18 y1.m SI.^ r-yrrv- (*ICM-l DI -3-w IOOI a6.m 4 Moa-- 0% 4 0 4 4 0 4 4 4 4 4 4 0 4 -b.*.umm 0% 4 4 4 4 4 0 4 4 4 4 0 4 4 -yr.-rcm ODI 4 4 4 4 4 4 4 0 4 4 4 4 4 e--=-mwl -....I 4 4 0 : 4Y : 4 4 4 4 0 4 f-T-- 4s lDDI UM 140% YPI 0 0 4 4 4 4 0 0 4 4 4 0 4 4 4 4 4 4 0 4 4 4 0 0 4 4 4 0 4 4 4 a 4 0 4 I 4 4 4 4 P 0 mala 4 *U 4 4 4 4 4 4 0 4 4 0 (sa 0 4 4 4 4 4 4 4 4 4 4 mm7 UJ3 I- w M U U U M 0 0 0 0 0 0 0 0 o 0 0 0 E 0 0 0 a 0 0 0 0 a 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 a 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 a 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 -.rvwur) . 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OM 0 E 0 0 0 0 0 0 0 0 0 0 om n 0 0 0 0 0 0 E 0 0 0 0 0 U 0 0 0 0 0 0 0 0 0 0 E 0 OM 0 0 0 0 0 0 0 0 0 0 0 0 Loo+ 0 0 0 0 0 0 0 0 0 0 0 0 OW 0 0 0 0 0 0 0 0 0 0 E 0 o...) aaoW 0 0 0 0 0 0 0 0 0 0 0 0 om n 0 0 0 0 0 0 0 0 0 0 0 0 U 0 0 0 0 0 0 0 0 0 0 0 0 OM 0 0 0 0 0 0 0 0 0 0 a 0 U 0 0 0 0 0 0 0 0 0 0 0 0 U 0 0 0 0 0 0 0 0 0 0 0 0 U 0 0 0 0 a 0 0 0 0 0 0 0 I- O 0 0 0 0 0 0 0 0 0 0 0 VmM 0 E O 0 0 0 0 0 0 0 0 0 sumn LDOI ami M oy LDDOM 0 0 0 0 0 0 0 0 0 0 0 0 am n 0 0 0 0 0 0 0 0 0 0 0 0 U 0 0 0 0 0 0 0 0 0 0 0 0 am 0 0 0 0 0 0 0 0 0 0 0 0 U 0 0 0 0 0 0 0 0 0 0 0 0 U 0 0 0 0 0 e o 0 0 0 0 0 0- 0 0 0 0 0 0 0 0 0 0 0 0 U 0 0 0 0 0 0 0 0 0 0 0 0 U 0 0 O 0 0 0 0 0 0 0 0 0 tm aw aw aw aw zu( aw 0 0 0 0 E IOX &I= 0 0 0 0 a LDox laa 130 Iaa IP 1P 130 IP 0 0 0 0 0 iaum am an 4 am am zm am am 0 0 0 0 4 ita 110 110 IIO IIO tm 110 RUNOATE: im EVUQC"T*WDWS*)(*LYSU 11mm 11mM ~ ~~ - r 1 1 a 4 I 1 7 4 # 10 11 127 1 TOTAL Jam41 hbu Mar41 Am48 Ma148 -8 Ad41 *up** (1 ocEl# Nd4 -11 2 2 14 f4 0 0 0 0 0 0 0 ... 0 0 0 16 0 0 0 0 0 0 0 0 0 0 16 0 2 14 0 0 0 0 0 0 0 0 0 0 18 0 0 0 0 0 0 0 0 0 0 0 0 I I 0 0 8 8 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 16 0 0 0 0 0 0 0 0 0 0 0 0 *WOO *= 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 tl.W.446 Io Io Io Io I I so Io 1 Io so 1 Io 0 0 0 0 0 0 0 0 0 0 0 0 0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 2300 4o.m 0 0 0 0 0 0 0 0 0 0 0 0 i.1m luoo 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 3.30% s8.m 0 0 0 0 0 0 0 0 0 0 0 cAan AVMU #on DEBT SUVICE l.OCd.137 0 0 0 0 0 0 0 0 0 0 0 0 Loan Rduw ?wmmI ll.UZ.oO1l 0 0 0 0 0 0 0 0 0 0 0 0 NO uLLa cn0ccU)s 1UtY 0 0 0 0 0 0 0 0 0 0 0 0 0.m 0 0 0 0 0 0 0 0 0 0 0 0 0 0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ?R~CT?ROFII 4 DmMw ?I.* 1 1um 0 0 0 0 0 0 0 0 0 0 0 0 Flnurw?uh.rhdl 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ?adclwUw ?roe 0 0 0 0 0 0 0 0 0 0 0 0 0 0 RUN DATE: DEYELOPYENTANDULES*HALIS(1 ~ 0 0 0 0 a a 2 14 dm Tola1 UnNi Anilabk 0 0 0 0 0 0 0 0 0 0 0 16 a0 FU~ 8 0 0 0 0 0 0 0 4 4 0 0 0 8 0 0 0 0 0 0 0 4 4 0 0 0 PIAN2 PUN3 0 0 0 0 0 0 0 0 0 0 0 0 0 PUN4 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 E%?- Td.l Unit Cb.lnpi 86 8 0 . . PUN2 PUN3 PUN4 0 0 0 0 0 0 0 4 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 GROSS SALeS PROCEEDS so so so so so so lo WZZJ sal2223 lo W so REDEVELOPMENT SET ASIDE-MCK END 0 0 0 0 0 0 0 0 0 0 0 0 s.1.1 UWMlng Coal 8miunbmmruron 0.oOY 0 0 0 0 0 0 0 0 0 0 0 0 EsuwQ8irqbr(r urn 0 0 0 0 0 0 0 2o.OOo 2o.m 0 0 0 Trrh Tu 1.10% 0 0 0 0 0 0 0 9.154 0.1Y 0 0 0 WwranIyR- 0 0 0 0 0 0 0 0 0 0 0 0 0 UllgaUonR- 0.W 0 0 0 0 0 0 0 0 0 0 0 0 Tow Sa*. L. Marcutlng 3.50% 0 0 0 0 0 0 0 ZS.W 2B.W 0 0 0 CASH AVIlugLE FOR DEBT SERVUE 0 0 0 0 0 0 0 803.069 m.wo 0 0 0 Loan Rakasa P.vrmnt 0 0 0 0 0 0 0 (799.097l (6s3,5J.(y17) 0 0 0 NET SALES PROEEEDS 0 0 0 0 0 0 0 3,972 149,262 0 0 0 Partrm Pnhmd Wurn am 0 0 0 0 0 0 0 0 0 0 0 0 Pnfamd Raturn 0.m 0 0 0 0 0 0 0 0 0 0 0 0 Partrm Equity Rapqnmn( 0 0 0 0 0 0 0 0 0 0 0 0 EquW Ww-n( 0 0 0 0 0 0 0 0 0 0 0 0 PROJECT PRWT 0 0 0 0 0 0 0 3.972 149m 0 0 0 Dmlo#rPm(W 1 0 0 0 0 0 0 0 3.972 149262 0 0 0 Fbundrl Par(nr Pmol 0 0 0 0 0 0 0 0 0 0 0 0 0 BWr Puuslpr~ Pmnt 0 0 0 0 0 0 0 0 0 0 0 0 0 ToW urn InnntOIy 0 0 0 0 0 0 0 8 0 0 0 TRANSMISSION VERIFICATION REPC-” -I TIME : 18/83/1997 12:53 NAME : CATELLUS RESIDENTIAL FAX : 714-251-1933 TEL : 714-251-6188 18/83 12:34 17684388981 30 00: 18: 56 -. , .‘ 1.8. !_.. .. -.> c 1 Item No. 4 i The Cify of Carlsbad Housing & Redevelopment Department I A REPORT TO THE HOUSING COMMISSION DATE: SUBJECT: Sfaf Craig D. Ruiz Management Analyst OCTOBER 23,1997 POINSETTIA PROPERTIES - REQUEST FOR CONCEPTUAL REVIEW OF AFFORDABLE HOUSING COMPONENT OF THE POINSETTIA PROPERTIES SPECIFIC PLAN I. RECOMMENDATION That the Housing Commission ADOPT Resolution No. 97-012, recommending that the City Council APPROVE affordable housing component of the Poinsettia Properties Specific Plan. 11. PROTECT BACKGROUND The applicant is processing an application for a specific plan for an area totaling 92 acres. Approval of the project will allow the development of a Transit-Oriented Development (TOD) project which will include tourist commercial uses, mixed-use (commercial/residential) development, multiple family developments and small lot single family developments. 111. DISCUSSION The Poinsettia Properties Specific Plan will allow for the development of 857 market rate homes and a resulting affordable housing requirement of 151.35 units. The proposed project will allow for the development of a maximum of 142 unit affordable apartment project located entirely within planning area 5 (See Attachment 2). Planning Area 6 is proposed to be a mixed use project, commercial and residential project with 51 market rate apartments and 9 affordable apartments. The Specific Plan does allow the development of second dwelling units within Planning Areas 2 & 4. The second units, if constructed, may provide up to 20% of the projects affordable housing obligation (29 second dwelling units). The Housing Commission is being asked to provide a recommendation on the proposed affordable housing concept only. This includes the proposed general location of the affordable units and the potential development of 29 second dwelling units to satisfy the project’s inclusionary housing obligation. The specific affordable projects and related agreements will be returned to the Housing Commission for specific approval at a later date. POINSETTIA PROPERTIES OCTOBER 23,1997 PAGE 2 IV. RECOMMENDATION The proposed affordable housing projects will be located adjacent to a commercial shopping area and a commuter rail station. These locational factors make this a very desirous location for an affordable housing project. The individual affordable housing projects will be required to go before the Housing Commission for project review. Therefore, staff recommends that the Housing Commission recommend approval of the affordable housing concept contained in the Poinsettia Properties Specific Plan. EXHIBITS 1. Housing Commission Resolution No. 97-012 2. Land Use Map Exhibit r 4 c1 4 E E 7 a 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 20 HOUSING COMMISSION RESOLUTION NO. 97-012 A RESOLUTION OF THE HOUSING COMMISSION OF THE CITY OF CARLSBAD, CALIFORNIA, TO RECOMMEND THAT THE CITY COUNCIL APPROVE THE AFFORDABLE HOUSING CONCEPT TO SATISFY THE AFFORDABLE HOUSING OBLIGATION OF THE POINSETTIA PROPERTIES SPECIFIC PLAN CONTAINED IN SAID PLAN BY PROVIDING 152 AFFORDABLE UNITS THROUGH THE CONSTRUCTION OF UP TO 151 APARTMENT UNITS AND UP TO 29 SECOND DWELLING UNITS AS REQUESTED BY HSL\BP\MICHAN, L.P APPLICANT: HSL\ BP\ MICHAN, L.P CASE NO: SP 210 WHEREAS, the HSL\BP\MICHAN, L.P ("developer") has submitted for approval Ipecific Plan No. 210 which includes a request to construct 857 single family homes and 152 ffordable housing units; WHEREAS, the development of said Specific Plan will require the developer to provide 52 units of housing affordable to lower income households as required by Carlsbad Municipal :ode Section 21.85 of the City's Inclusionary Housing Ordinance; WHEREAS, the developer is proposing to meet the requirements of CMC 21.85 through ie provision of 152 affordable housing units including up to 151 apartment units and up to 29 xond dwelling units; WHEREAS, the City of Carlsbad's Housing Commission did, on the 23" day of October, 997, hold a special public meeting to consider the affordable housing concept contained in said pecific Plan; WHEREAS, at said special public meeting, upon hearing and considering all testimony, any, of all persons desiring to be heard, said Commission considered all factors relating to the roposed affordable housing concept; NOW, THEREFORE, BE IT HEREBY RESOLVED by the Housing Commission of the ity of Carlsbad, California, as follows: 1 C RESO. NO. 97-012 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 1 . The above recitations are true and correct. 2. The project is consistent with the goals and objectives of the City of Carlsbad's Housing Element and Comprehensive Housing Affordability Strategy, the Inclusionary Housing Ordinance, and the Carlsbad General Plan. 3. That based on the information provided within the Housing Commission Staff Report and testimony presented during the special public meeting of the Housing Commission on October 23, 1997, the Housing Commission recommends that the City Council APPROVE the affordable housing concept to satisfy the affordable housing obligation of the Poinsettia Properties Specific Plan contained in said plan by providing 152 affordable units through the construction of up to 151 apartment units and no more than 29 second dwelling units. PASSED, APPROVED, AND ADOPTED at a special meeting of the Housing 'ommission of the City of Carlsbad, California, held on the 23.d day of October, 1997, by the ollowing vote, to wit: AYES: NOES: ABSENT: ABSTAIN: KATHLEEN WELLMAN, Vice- Chairperson CARLSBAD HOUSING COMMISSION IEBBIE FOUNTAIN icting Housing and Redevelopment Director 2 [C RESO. NO. 97-012 POINSETTLA PROPERTIES SPECIFIC PL,AN Land Use Summary Exhibit 6kon tinued Planning Areas Market Rate Affordable Units Subject to Requirement Affordable Housing 0 General Location of 15'YoAffordable Housing I 0 Total Market Rate and Affordable Units 2- I 114 I 20.1 5 0 6 51 7 356 8 150 0 142 142 9.0 10 61 62.8 Planning Area 5 356 26.5 Planning Area 5 150 0 I 0 31 0 Io I 0 0 ~~ ~ 4 I 186 1 32.8 I PlanningArea5 I 186 Total I 857 I 151.2 I 152 I 1009 27 a 0 Z 0 0 In 0 In cv cv io - I b The City of Carlsbad Housing & Redevelopment Department I A REPORT TO THE HOUSING COMMfSSfON Staff Craig D. Ruiz Management A nalus t DATE: SUBJECT: OCTOBER 23,1997 MARIAN0 PROTECT - REQUEST FOR RECOMMENDATION OF APPROVAL TO THE CITY COUNCIL OF A 27 UNIT ON-SITE AFFORDABLE APARTMENT PROJECT TO SATISFY THE REQUIREMENTS OF THE INCLUSIONARY HOUSING ORDINANCE FOR THE DEVELOPMENT OF 150 RESIDENTIAL HOMES IN THE MARIAN0 PROJECT I. RECOMMENDATION That the Housing Commission ADOPT Resolution No. 97-013, request for recommendation that the City Council APPROVE a 27 unit on-site affordable apartment project to satisfy the requirements of the inclusionary housing ordinance for the development of 150 residential homes in the Mariano Project. 11. PROTECT BACKGROUND The Mariano Project is located in the Southwest Quadrant of the City. The applicant, PacWest Group, is now processing a tentative map and site development plan to allow for 150 single family homes on a 54 acre parcel. In conjunction with these plans, the developer is also proposing to construct 27 affordable apartment units to satisfy the inclusionary housing obligation of the overall development. 111. AFFORDABLE PROTECT DESCRIPTION A. Location The proposed development is surrounded by Cobblestone Road and the Sudan Interior Mission to the north, the Emerald Ridge East subdivision to the west, the Sambi Seaside Heights subdivision to the south, and the Cobblestone subdivision to the east. The affordable housing component will be located on the southeast corner of the future extension of Aviara Parkway and Cobblestone Road. MARIAN0 PROJECT OCTOBER 23,1997 PAGE 2 B. Iv. V. VI. Unit Mix The project will consist of 177 total units, 150 single family homes and a 27 unit affordable apartment complex. The overall project will also include two open space lots, two recreation lots and an RV storage lot. DEVELOPMENT TEAM A. Developer - PacWest B. Engineer - Hunsaker & Associates C. Design and Planning - The Case Group Architects, Henthorn & Associates; The project is located within Area A of the Zone 20 Specific Plan (SP203), within the Southwest Quadrant of the City. The affordable project will be located at the southeast corner of the future extension of Aviara Parkway and Cobblestone Road. The surrounding land uses consist of existing and proposed single family development. Within a one-mile radius of the site, there is an existing community park, commercial shopping and various industrial parks. AFFORD ABILITY A. Rent and Income Levels The apartments will be restricted to households with incomes not exceeding 80% of the area median. B. Target Population The proposed mix of affordable units will be targeted to lower-income renters. With a growing number of lower-income jobs in Carlsbad, there is a sigruficant employee demand for affordable housing which will improve the jobs/housing balance. C. Terms of Affordability An Affordable Housing Agreement will be executed with the developer which establishes terms of affordability which comply with the Inclusionary Ordinances. A draft of the Agreement is included as Attachment No. 2. ./- MARIAN0 PROJECT OCTOBER 23,1997 PAGE 3 VII. VIII. D. Housing Element/Consolidated Plan Consistency The proposal is consistent with the policies and programs of the Housing Element, Inclusionary Housing Ordinance and the Zone 20 Specific Plan affordable housing requirements. The rental apartments, affordable at 80% of Area Median Income, would support several Housing Element Goals and Objectives, including Objective 2.1 (Regional Housing Needs), Objective 3.2 (Larger Units), Objective 3.5 (Lower Income New Construction), Objective 3.6 (Inclusionary Housing, Objective and Goal 4 (Jobs- Housing Balance). FINANCIAL At this time the developer has not requested financial assistance with respect to the affordable housing proposals; however, they have indicated that they may make such a request at a later date. If such a request is made, it would be evaluated at that time and would be subject to the review of the Housing Commission and the approval of the City Council. SUMMARY As proposed, the project would address established City affordable housing needs in a manner that is consistent with applicable City policies and ordinances. As required by the Inclusionary Housing Ordinance, the developer and the City must enter into an Affordable Housing Agreement prior to this project's final map or being issued a building permit. An Affordable Housing Agreement records specific requirements of the Inclusionary Ordinance, including unit type, affordability levels and construction timing. Based on the above considerations, staff recommends support of this proposal and a recommendation of approval to the City Council. It is the role of the Housing Commission to make recommendations to the City Council based on several considerations with respect to 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 aflorduble housing policies and ordinances as expressed in the Housing Element, Inclusionary 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. ,- MARIAN0 PROJECT OCTOBER 23,1997 PAGE 4 IX. EXHIBITS 1. Housing Commission Resolution No. 97-013 2. Draft Affordable Housing Agreement 3. Reduced Plan Exhibits 1 2 c: 4 K E 7 a 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOUSING COMMISSION RESOLUTION NO. 97-013 THAT THE HOUSING COMMISSION RECOMMEND AFFORDABLE APARTMENT PROJECT TO SATISFY THE REQUIREMENTS OF THE INCLUSIONARY HOUSING ORDINANCE FOR THE DEVELOPMENT OF 150 RESIDENTIAL HOMES IN THE MARIAN0 PROJECT APPLICANT: PACWEST APPROVAL TO THE CITY COUNCIL OF THE 27 UNIT ON-SITE CASE NO: CT 97-14, PUD 97-11, SDP 97-16, HDP 97- 13, CDP 97-34 WHEREAS, the developer is processing Carlsbad Tract Map CT 97-14 to allow for 150 ;ingle family detached homes; WHEREAS, the developer has proposed to cohstruct twenty-seven apartment units iffordable to lower income households as a means to satisfy their affordable housing ibligations as permitted by Carlsbad Municipal Code Section 21.85 of the City’s Inclusionary lousing Ordinance; WHEREAS, the developer’s proposal to construct said units has been submitted to the Iity of Carlsbad’s Housing Commission for review and consideration; WHEREAS, said Housing Commission did, on the 23rd day of October, 1997, hold a mblic meeting to consider said proposal to construct 27 affordable apartment units; WHEREAS, at said public meeting, upon hearing and considering all testimony, if any, ,f all persons desiring to be heard, said Commission considered all factors relating to the n-oposal to construct said affordable housing units; NOW, THEREFORE, BE IT HEREBY RESOLVED by the Housing Commission of the Zity of Carlsbad, California, as follows: 1. The above recitations are true and correct. IC RESO. NO. 97-013 1 1 2 1 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 2. 3. 4. 5. The project is consistent with the goals and objectives of the City of Carlsbad's Housing Element and Comprehensive Housing Affordability Strategy, the Inclusionary Housing Ordinance, and the Carlsbad General Plan. The project will provide a total of twenty-seven affordable apartment units affordable to households at 80% or below of the Area Median Income which meets a "medium priority" affordable housing need as outlined within the City of Carlsbad's approved 1995-2000 Consolidated Plan. 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 October 23,1997, the Housing Commission ADOPT Resolution No. 97-013, recommending APPROVAL to the City Council of a 27 unit on-site affordable apartment project to satisfy the requirements of the inclusionary housing ordinance for the development of 150 market rate residential homes in the Mariano Project. That the Housing Commission recommends that the City Manager or his designee be authorized to execute the Affordable Housing Agreement in substantially the form presented in Exhibit 2 to the Housing Commission Staff Report, subject to review and approval by the City Attorney. Zonditions: Recommendation of approval is granted for Site Development Plan 97-03, incorporated by reference and on file in the Housing and Redevelopment Department. Development shall occur substantially as shown unless otherwise noted in the conditions of project approval by the City Council. I. Recommendation of approval is granted for Site Development Plan 97-16 subject to the condition that the applicant submit an acceptable schedule for construction of the required ratio of income restricted units for inclusion in the final Affordable Housing Agreement to be approved prior to Final Map. The schedule shall indicate acceptable construction phasing for the affordable units in relation to the construction of the market rate units. 1. The affordable housing units must be deed restricted for "the useful life of the project" which means a minimum of 55 years. .. Upon final approval of said affordable housing project and prior to final map approval, the applicant shall enter into an Affordable Housing Agreement with the City of Carlsbad. The agreement shall be binding to all future owners and successors in interest. IC RESO. NO. 97-013 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 28 PASSED, APPROVED, AND ADOPTED at a special meeting of the Housing Zommission of the City of Carlsbad, California, held on the 23.6 day of October, 1997, by the 'ollowing vote, to wit: AYES: NOES ABSENT: ABSTAIN: KATHLEEN. WELLMAN, Vice-Chairperson CARLSBAD HOUSING COMMISSION IEBBIE FOUNTAIN 9cting Housing and Redevelopment Director IC RESO. NO. 97-013 3 RECORDING REQUESTED BY: City of Carlsbad WHEN RECORDED MAIL TO: City of Carlsbad City Clerk’s Office Attn.: City Clerk 1200 Carlsbad Village Drive Carlsbad, California 92008 (Space above for Recorder’s Use) AFFORDABLE HOUSING AGREEMENT IMPOSING RESTRICTIONS ON REAL PROPERTY This AFFORDABLE HOUSING AGREEMENT IMPOSING RESTRICTIONS ON REAL PROPERTY (“Agreementyy), entered into this day of , 1997, by and between the CITY OF CARLSBAD, a Municipal Corporation (hereinafter referred to as the Tity”), and I , (hereinafter referred to as the “Developer“), is made with reference to the following: A. Developer is the owner of certain real property in the City of Carlsbad, in the County of San Diego, California (hereinafter referred to as the “subject property”) described in Exhibit “A,” which is attached hereto and incorporated herein by this reference. B. Developer wishes to construct 177 residential housing units which includes 150 units for sale at prevailing market prices (“Market Units”) and 27 apartment units for rent to household earning less than 80% of the Area Median Income (“Affordable Units”) on the subject property. The City has approved Carlsbad Tentative Tract Map Number CT and Site Development Plan Number SDP The City issued this approval subject to certain Conditions of Approval, including a condition requiring the Developer to enter into an Affordable , for the proposed development. Housing Agreement in which Developer agrees to provide 27 dwelling units affordable to lower-income households. 1 10/15/979:31 AM NOW, THEREFORE, it is mutually agreed by and between the undersigned parties as follows: 1. Satisfaction of Affordable Housing Obligation and Conditions of ApDroval. In order to satisfy the Conditions of Approval and requirements of the City’s Inclusionary Housing Ordinance, Carlsbad Municipal Code Chapter 21.85, Developer shall provide a total of twenty-seven (27) Affordable Units which shall be initially restricted and affordable to lower income households. 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 City and Agreement shall be executed prior to the approval of the final map for the subject property. 2. Terms Governing Provision of Affordable Units. 2.1. Obligation to Provide Affordable Units. Developer shall provide Affordable Units in relation to Market Units (“Market Units”) on the Subject Property. The Developer shall provide twenty-seven (27) affordable apartment units. The maximum allowable income level of buyers of the affordable units shall be restricted to a maximum of 80% of the area median income. 2.2 Schedule for Developing Affordable Units. 2.2.1 Developer shall begin construction of the Affordable Units prior to construction of the thirtieth (30th) Market Rate Unit. 2.2.2 Developer shall complete construction of all twenty-seven (27) Affordable Units and make them available within eighteen (1 8) months of the commencement date of construction of the Affordable Units. 2.2.3 The Affordable Units shall be developed in accordance with the approved Site Development Plan SDP 3. City Approval of Documents. 3.1. The following documents, in form and substance acceptable to the City, shall be used in connection with the sale of Affordable Units. Documents to be prepared by the Developer shall 2 10/15/979:31 AM be submitted to the Housing and Redevelopment Director for review and approval no later than the start of construction of the Affordable Units. 3.1.1. A marketing plan establishing the process for seeking, selecting and determining the eligibility of renters of the Affordable Units shall be prepared by the Developer. 4. ReDorting and Compliance Monitoring. An annual report verifying compliance with the requirements of this Agreement shall be provided to the City by the Developer and certified by a third party such as a Certified Public Accountant approved by the Housing and Redevelopment Director. Developer shall provide the City with other reports as reasonably required by the City to verify compliance with this Agreement. 5. Default. Failure of the Developer to cure any default in the Developer’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 the Developer to commence to cure such default within the ninety (90) day period or the Developer’s failure to proceed diligently to complete the cure of such a default within a reasonable time period) will constitute a failure to satisfy the Conditions of Approval with respect to the Subject Property and the requirements of Chapter 21.85 of the Carlsbad Municipal Code and void the approval of the Final Map and Site Development Plan; and the City may exercise any and all remedies available to it with respect to the Developer’s failure to satisfy the Conditions of Approval, including but not limited to, the withholding of building permits for the Market Units within the Subject Property. 6. Appointment of Other Agencies. At its sole discretion, 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. 7. Burden to Run with Property. The covenants and conditions herein contained shall apply to and bind the heirs, executors, administrators, successors, transferees, and assignees of all 3 10/15/979:31 AM the parties having or acquiring any right, title or interest in or to any part of Subject Property and shall run with and burden the Subject Property until terminated in accordance with the provisions hereof. Prior to the issuance of building permits, the 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. Notwithstanding anything to the contrary set forth in this Agreement, individual purchasers of 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. 8. Hold Harmless. Developer will indemnify 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, 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 in any manner to developer’s actions or defaults pursuant to this Agreement, and shall protect and defend Indemnitees, and any of them with respect thereto. Developer shall obtain, at its expense, the following insurance policies for development of the Subject Property naming Indemnitees as additional named insureds with aggregate limits of not less than five million dollars ($5,000,000) purchased by Developer 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 any building permit for the Subject Property. 9. Notices. All notices required pursuant to this Agreement shall be in writing and may 4 10/15/979:31 AM be given by personal delivery or by registered or certified mail, return receipt requested, to the party to receive such notice at the addressed set forth below: TO THE CITY OF CARLSBAD: CITY OF CARLSBAD Housing and Redevelopment Department Attn: Acting Housing and Redevelopment Director 2965 Roosevelt Street, Suite B Carlsbad, California 92008-23 89 TO THE DEVELOPER: 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. 10. 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. 11. Duration of Agreement. This Agreement shall terminate and become null and void upon the earlier of: (a) the closing of the sale of the last of the Affordable Units to an individual purchaser pursuant to a sale on an approved public report in compliance with the California Subdivided Lands Act, or (b) upon 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 Developer and the Community Development Director 12. Recording of Agreement. The parties hereto shall cause this Agreement to be recorded against the Subject Property in the official Records of the County of San Diego. 13. Severabilitv. 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. 5 10/15/97931 AM IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the day and year first above written. DEVELOPER CITY CITY OF CARLSBAD, A Municipal Corporation By: By: Signature MARTIN ORENYAK Community Development Director Name: APPROVED AS TO FORM: Title : RONALD R. BALL City Attorney 6 10/15/979:31 AM -? STATE OF CALIFORNIA ) COUNTY OF 1 ) 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 his/her/their authorized capacity(ies), and that by hiskedtheir 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 , 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 hiskedtheir authorized capacity(ies), and that by hiskerltheir signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. and WITNESS my hand and official seal. Notary Public in and for said State (SEAL) 7 10/15/97931 AM .. 2: .: ii n - t a 1 It I c i I The City of Carlsbad Housing & Redevelopment Department I A REPORT TO THE HOUSING COMMISSION Item No. 6 Stafi: Leilani Hines Management Analyst DATE: October 23,1997 SUBJECT: 1996-97 COMPREHENSIVE HOUSING AFFORDABILITY STRATEGY ANNUAL PERFORMANCE REPORT I. RECOMMENDATION No action required. Informational report only. 11. PROJECT BACKGROUND As required by the federal regulations for the Community Development Block Grant (CDBG) Entitlement Program, the City must prepare the Comprehensive Housing Affordability Strategy (CHAS) Annual Performance Report (APR) for submission to the U.S. Department of Housing and Urban Development (HUD). The period covered by the attached APR is July 1, 1996 to June 30, 1997. As a recipient of federal CDBG Entitlement funds, the City of Carlsbad is required to prepare an APR on an annual basis. The purpose of the CHAS Annual Performance Report is to: 1) Report on progress in carrying out the Consolidated Plan Annual Strategy; and 2) Assess the City’s annual performance in relationship to meeting the City’s overall five year priorities and strategies. The City is required to make the APR available to the public for review and comment. A notice was published in a local newspaper announcing the public review and comment period. In addition, all CDBG fund recipients and other interested parties were mailed a notice announcing the public review and comment period. The public review and comment period for the APR was initiated on September 7, 1997. Comments were accepted until 5:30 p.m. on September 22, 1997. A summary of comments received during the public review period are attached as an appendix to the APR. The APR was submitted to the U.S. Department of HUD on October 8, 1997. 111. EXHIBIT 1. 1996-97 CHAS Annual Performance Report