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Home My WebLink About2000-03-14; City Council; 15645; Affordable Housing Credits For Villa Loma. , ? CJ 3 . . p 2 6 f 8 CITY Of = CARLSBAD -AGENDA BILL AB# 15; 445 I - TITLE : APPLICATION TO PURCHASE AFFORDABLE DEPT. HD. HOUSING CREDITS IN THE VILLA LOMA MTG. 3-&,?obO HOUSING PROJECT CITY ATTY. % -.Y I RECOMMENDED ACTION: ADOPT Resolution 2booe?f , APPROVING a request by Brett Development, Inc., to purchase 1.94 Affordable Housing Credits in the Villa Loma housing project in order to satisfy the affordable housing obligation of the Regency project under the City’s lnclusionary Housing Ordinance. I ITEM EXPLANATION: The Regency project is a 11 unit residential development consisting of 10 attached twinhomes and one single family residence. The tentative map and site development plan were approved by the Planning Commission on December 15, 1999. The applicant is requesting to purchase affordable housing credits in the Villa Loma Project to satisfy the projects 1.94 unit inclusionary housing obligation. The City Council is the approval body for the purchase of affordable housing credits. The Regency project has two potential options in satisfying its’ inclusionary housing obligation. The project could potentially construct on-site affordable units or purchase credits. The project is a small subdivision both in terms of the number of units (11) and net developable area (1.7 acres). Due to the small size of the project, it would be difficult to physically and financially integrate a one-unit affordable housing project with the market rate subdivision. Because of the constraints of the project site, the applicant has elected to pursue the purchase of affordable housing credits. The City Council has adopted Policies 57 & 58 that govern the sale of affordable housing credits. The policies examine the feasibility of an on-site proposal, the advantages and disadvantages of an off-site proposal, and whether the off-site project advances the City’s housing goals and strategies. In reviewing the applicant’s request, the Affordable Housing Policy Team (staff) has utilized the criteria contained in the policies in making their recommendation to approve the purchase of the credits. FISCAL IMPACT The Affordable Housing Credit is currently $36,000 per unit. The purchase of 1.94 credits will result in a payment of $69,840 to the City’s Housing Trust Fund. I EXHIBITS 1. City Council Resolution No. lb00 -7? 2. Applicants Request to Purchase Credits 3. Draft Affordable Housing Agreement 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 RESOLUTION NO. 2000-79 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, APPROVING A REQUEST BY BRETT DEVELOPMENT, INC. TO PURCHASE 1.94 AFFORDABLE HOUSING CREDITS IN THE VILLA LOMA HOUSING PROJECT IN ORDER TO SATISFY THE AFFORDABLE HOUSING OBLIGATION OF THE REGENCY PROJECT UNDER THE CITY’S INCLUSIONARY HOUSING ORDINANCE. APPLICANT: BRETT DEVELOPMENT, INC. CASE NO: CT 99- 14, PUD 99-06 WHEREAS, Brett Development, Inc. has received approval of Tentative Map CT 9-14 for the development of a 11 unit residential development; and WHEREAS, Brett Development, Inc. has requested approval from the City of Carlsbad City Council for the purchase of 1.94 affordable housing credits in the Villa Loma housing project to satisfy the inclusionary housing requirement of Tentative Map CT 99-14; and WHEREAS, the City Council did hold a public meeting to consider said request for the purchase of Affordable Housing Credits by Brett Development, Inc.; and WHEREAS, at said public meeting, upon hearing and considering all testimony, if any, of all persons desiring to be heard, said Council considered all factors relating to the application and request to purchase Affordable Housing Credits: NOW, THEREFORE, BE IT HEREBY RESOLVED by the City Council of the City of Carlsbad, California, as follows: 1. That 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, the Inclusionary Housing Ordinance, and the Carlsbad General Plan. 3. Based upon the analysis contained within the City Council Staff Report dated March 7, 2000, the City Council finds that the off-site satisfaction of the inclusionary housing requirement is in the public interest. 1 2 2 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 4. That based on the information provided within the City Council Staff Report and testimony presented during the public meeting of the City Council, the City Council hereby APPROVES a request by Brett Development, Inc. to purchase 1.94 affordable housing credits in the Villa Loma housing project in order to satisfy the affordable housing obligation of the Regency project under the city’s inclusionary housing ordinance. 5. That the City Council hereby authorizes the Community Development Director to execute the Affordable Housing Agreement in substantially the form presented to the City Council as Exhibit 3 of the City Council 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. PASSED, APPROVED, AND ADOPTED at a regular meeting of the City Council of the City of Carlsbad, California, held on the 14th day of MARCH ,2000, by the following vote, to wit: AYES: Council Members Lewis, Hall, Finnila, Nygaard, Kulchin NOES: None ABSENT: None ABSTAIN: ATTEST: hQJQz&J * . WOOD, City Clerk (SEW cc Fe30 # 2000-79 PAGE2 . OFF-SITE AND COMBINED lNCLUSIONARY HO&SING PROJECT ASSESSMENT w0RKSHEE-I Exhibit No. 2 dACKGROUND - I. Applicant Name and Address: Brett Development, Inc. 205 Meadow Vista way Encinitas, CA 92024 2. Off-site or Combined Project Name: Villa Loma Apartments 3. Description of Project with lnclusionary Housing Obligation: The Regency will consist of 11 single family residences - 5 twin homes and 1 single family detached unit. The site consists of three parcels totalling 1.77 acres. Inclusionary housing obligation - 1.65 credits. C. Proposed On-site Project Description (ii any): No onsite project proposed. i. Proposed Off-site Project Description: The Villa Loma Apartment Project, Carlsbad, CA. . Description of On-site Project Constraints: Specific constraints affect the feasibility of an on-site project. The significant product type disparity, the size of the project (11 units) and economics of providing on-sl!e project as opposed to purchasing inclusionary housing credits. Attachment “1” to Council Policy Statement No. 57 WORKSHEET - ASSESSMENTCONCLUSlON (Check appropriate box) ASSESSh4ENTCRjlERu 1. Feasibility of the On-site Proposal. DOES NOT SUPPORT oFPzmPRoms4L INCONUUSMZ SUPPORTS OFFig momsu 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? Brief Narrative: The Regency consists of 11 units of approximately 2,300 S.F. These units are projected to sell at $330,000 + per unit. There would exist an extreme disparity.in these units and any built to comply with the inclusionary housing criteria. The uneconomical small scale of an affordable project. 1. Will an affordable housing product be difficult to inteqrate into the proposed market development because of significant price and product type disparity? Brief Narrative: Yes - See A. :. Does the on-site development entity have the caoacitv to deliver the proposed affordable housing on-site? Brief Narrative: No - The development entity is a developer of small high end tracts and custom homes. Relative AdvantaqesDisadvantaqes of the Off- site Proposal. Does the off-site option offer greater feasibility and cost effectiveness than the on-site alternative, particularly regarding potential local pubiic assistance? 2 . . . ASSESMEM-CONCLUSION (Check appropriate box) DOES NOT SUPmRT SuPmRls OFF-SITE ASSEW- ~PFmPosu MzcwauslvE PRomsAL Brief Narrative: Yes - The offsite proposal of Villa Loma Apartments offer both greater feasibility and cost effectiveness than an offsite project. b. Oaes the off-site proposal have location -- I advantaqes over the on-site alternative, such as proxmity tq jobs, schools, transportation, services; less impact on other existing developments. etc.? I ! grief Narrative: Yes - The Villa Loma Apartments offer greater proximity to jobs (nearby business parks and retail establishments) public trans- 1 portation, schools, shopping and parks. Its location on El Camino ( Real near Palomar Airport Road afford it better accessibility. i c. Does the off-site option offer a development entity with the caoaciw to deliver the proposed project? Brief Narrative: Yes - Villa Loma Apartments has delivered in the past a develop- ment designed, built and managed professionally for affordable 1 housing applicants. ;I d. Does the off-site option satisfy multiple develooer obliqations that would be difficult to satisfy with multiple projects? Bn’ef Narrative: !I Yes - Villa Loma Apartments has been able to satisfy the affordable' housing project criteria with an experienced apartment developer, / professional management in cooperation with the City of Carlsbad, j multiple onsite projects are difficult with an 11 unit project. 1 3. Advancino ,+ousinq Goals and Stratecw I I I , a. Does the off-site proposal advance and/or support City housing goals and policies expressed in the Housing Element WAS and Inclusronary Housing Ordinance? brief Narrative: - villa. Loma Apartments make available to l:Sger rental units to lower income households qualified tenants The city will recoup its investment quicker in the Villa Lomb project with this apnlicants oarticisation. The Reuency's 15% (1.65 units) DOES NOTSUpPORT SVP~RTS OFFSm SUMMAfW O--SrE Pmmx~~ lNCONCLUSlvE PRomsAL I’ i contribution will aid in using "existing excess" affordable units. 3 Date Considered bv Review Committee: Review Committee Action: Action- - 4 CITY OF OCEANSIDE L \ \ PSi+ . . .:... :;,. CITY OF VISTA CiTY OF ENCINITAS - VICINITY hhp . . .. -. - . _’ . - . *: i . ‘. .’ -.. .* Exhibit No. 3 RECORDING REQUESTED BY: City of Carlsbad WHEN RECORDED MAIL TO: City of Carlsbad City Clerk’s Office Attn: Citv Clerk 1200 Carlsbad Village Drive Carlsbad, California 92008 (Space above for Recorder’s Use) AFFORDABLE HOUSING AGREEMENT THIS AFFORDABLE HOUSING AGREEMENT (“Agreement”) is entered into this day of ,2000, by and between the CITY OF CARLSBAD, a municipal corporation (hereinafter referred to as the “City”), and Brett Development Inc., (hereinafter referred to as the “Developer”), is made with reference to the following: RECITALS A. Developer is the owner of certain real property in the City of Carlsbad, County of San Diego, State of California, described in “Attachment A”, which is attached hereto and incorporated herein by this reference, and which is the subject of a Tentative Map (CT 99-14), which provides conditional approval of the construction of 10 attached twinhomes and 1 single family dwelling (“Project”). B. Chapter 21.85 of the Carlsbad Municipal Code requires that this Affordable Housing Agreement shall be entered into between the City and the Developer as a means of satisfying the Developers’ affordable housing obligation (“Affordable Housing Obligation”), as such is defined under Chapter 21.85 of the Carlsbad Municipal Code. The Affordable Housing Obligation for this project is determined to be one and ninety-four one hundredths (1.94) units and will be satisfied by applying the requirements set forth in this Agreement. NOW, THEREFORE, incorporating the foregoing Recitals and in consideration of the mutual covenants contained herein, the parties agree as follows: 1. THE RECITALS ARE TRUE AND CORRECT. 2. SATISFACTION OF AFFORDABLE HOUSING REOUIREMENTS THROUGH THE PAYMENT OF AFFORDABLE HOUSING CREDITS. (a) Performance under this Agreement satisfies the Developers’ obligation for affordable housing under Chapter 2 1.85 of the Carlsbad Municipal Code as applied to the land covered by Carlsbad Tract No. 99-14 by reason of the approvals of the Tentative Map of CT 99-14, and any other applicable approval. (b) The Developer shall pay for one and ninety-four one hundredths (1.94) Affordable Housing Credits as established by the City and as required by Condition No. 13 of Planning Commission Resolution No. 4691. The fee shall be paid prior to the Developer receiving a building permit for the project. 3. REMEDIES Failure by the Developer to perform in accordance with this Agreement will constitute failure to satisfy the requirements of Chapter 21.85 of the Carlsbad Municipal Code and Condition No. 13 of Planning Commission Resolution No. 469. Such failure will allow the City to exercise any and all remedies available to it including but not limited to withholding the issuance of building permits for the lots shown on Carlsbad Tract No. 98-02. 4. HOLD HARMLESS Developer will indemnity and hold harmless (without limit as to amount) City and its elected officials, officers, employees and agents in their official capacity (hereinafter collectively referred to as “Indemnitees”), and any of them, from and against all loss, all risk of loss and all damage (including expense) sustained or incurred because of or by reason of any and all claims, demands suits, actions, obtained, allegedly caused by, arising out of or retaining in any manner to Developers’ actions or defaults pursuant to this Agreement, and shall protect and defend Indemnitees, and any of them with respect thereto. Developer shall obtain, at its expense, comprehensive general liability insurance for development of the ($1 ,OOO,OOO) purchased by the Developer from an insurance company duly licensed to engage in the business of issuing such insurance in the State of California, with a current Best’s Key Rating of not less than A-V, such insurance to be evidenced by an endorsement which so provides and delivered to the City Clerk prior to the issuance of any building permit for the Project. 5. NOTICES All notices required pursuant to this Agreement shall be in writing and may be given by personal delivery or by registered or certitied mail, return receipt requested to the party to receive such notice at the address set forth below: TO THE CITY: City of Carlsbad Housing and Redevelopment Department Attn: Housing & Redevelopment Director 2965 Roosevelt Street, Suite B Carlsbad, California 92008-2389 TO THE DEVELOPER: Brett Development Inc. 205 Meadow Vista Way Encinitas, CA 92024 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. ENTIRE AGREEMENT This Agreement constitutes the entire agreement between the parties and no modification hereof shall be binding unless reduced to writing and signed by the parties hereto. 7. DURATION OF AGREEMENT This Agreement shall terminate and become null and void upon the payment of the Affordable Housing Credits, or the repeal, termination, or modification of any applicable ordinance which act would render the Affordable Housing Obligation unnecessary or unenforceable. . 8. SUCCESSORS This Agreement shall benefit and bind the Developer and any successive owners of Affordable Housing Lots. 9. SEVERABILITY In the event any provision contained in this Agreement is to be held invalid, void or unenforceable by any court of competent jurisdiction, the remaining provisions of this Agreement shall nevertheless, be and remain in full force and effect. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed as of the day and year first above written. DEVELOPER CITY Brett Development Inc. City of Carlsbad, a municipal corporation By: (Name) By: MARTINORENYAK Community Development Director By: (Title) APPROVED AS TO FORM: RONALD R. BALL CITY ATTORNEY ATTACHMENT A LEGAL DESCRIPTION OF SUBJECT PROPERTY