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HomeMy WebLinkAbout2022-01-11; City Council; ; Request to purchase two affordable housing credits and approval of an Affordable Housing Agreement to satisfy the inclusionary housing requirement for the La Costa Villas Meeting Date: Jan. 11, 2022 To: Mayor and City Council From: Scott Chadwick, City Manager Staff Contact: Mandy Mills, Housing & Homeless Services Director mandy.mills@carlsbadca.gov, 760-434-2907 Subject: Request to purchase two affordable housing credits and approval of an Affordable Housing Agreement to satisfy the inclusionary housing requirement for the La Costa Villas North Project (CT 2019-001) District: 4 Recommended Action Adopt a resolution authorizing the purchase of two affordable housing credits and approving an affordable housing agreement to satisfy the inclusionary housing requirement for the La Costa Villas North Project. Executive Summary 400 Gibraltar, LLC is under contract to purchase and build a nine-unit condominium project, known as La Costa Villas North. The tentative map for the development was approved by the Planning Commission on October 20, 2021, and the project is required to provide two units affordable to low-income households. The project’s approval also requires an affordable housing agreement to be executed before a final map is recorded. (Planning Commission Resolution 7427, Exhibit 2) The home builder is seeking to satisfy its inclusionary housing requirement – a requirement intended to create affordable housing for lower-income families – by purchasing two affordable housing credits instead of building two affordable units on the site. The City Council is required to review and consider the request for the purchase of two affordable housing credits and the affordable housing agreement that implements the inclusionary housing requirement for the project, in accordance with the requirements and process set forth in Chapter 21.85 of the Carlsbad Municipal Code. Discussion On Oct. 20, 2021, the Planning Commission approved the development of a nine-unit condominium project on the south side of Gibraltar Street, at the intersection of Gibraltar Street and Jerez Court (Exhibit 3). To meet the project’s inclusionary housing requirement, the developer is requesting to purchase two affordable housing credits in the Cassia Heights Apartments development, which is also located in the city’s southeast quadrant. Jan. 11, 2022 Item #4 Page 1 of 43 On May 24, 2011, the City Council agreed to designate the Cassia Heights Apartments as a combined affordable housing project under the city's Inclusionary Housing Program. It provided 56 units of housing affordable to lower income households in excess of the inclusionary housing obligation for a market-rate housing developer. These 56 units represent housing credits that may be purchased by future housing developers in the southeast and southwest quadrants. At the discretion of the City Council, the credits may be purchased to satisfy a project’s inclusionary housing requirement at a price set by the City Council. The current per unit credit price for the Cassia Heights Apartments project is $66,300. The City Council has adopted policy statements nos. 57 and 58 (Exhibits 4 and 5) that govern the sale of affordable housing credits. The policies require the city to examine the feasibility of a proposal to build affordable housing units on the project site, the advantages and disadvantages of an off-site proposal, and whether the off-site project advances the city's housing goals and strategies. Because of the small size of the project, the applicant has elected to request the purchase of affordable housing credits rather than constructing units on the site of the market rate development. The city’s Affordable Housing Policy Team has reviewed the request and, using the criteria in the City Council policies, recommend that the City Council approve the applicant’s request to purchase the credits for the project. A summary of the analysis can be found in Exhibit 5. On Nov. 18, 2021, the Housing Commission took action to recommend that the City Council approve the applicant’s request to purchase two affordable housing credits to satisfy the project's inclusionary housing obligation (Exhibit 6). Three members of the Housing Commission did, however, want to express to the City Council their belief that the existing methodology of meeting the inclusionary requirements should be examined and changed to better reflect the variable cost of providing an affordable unit, depending on the market rate product type and price. City staff is working on draft amendments to the City Council policies that include the affordable housing credit purchase process for City Council consideration in early 2022. Carlsbad Municipal Code Chapter 21.85 requires the developer of a project to receive approval of an affordable housing agreement that details how the requirements of the Inclusionary Housing Ordinance shall be met. The City Council is the final decision maker of agreements when there is a request to satisfy the requirement through alternative methods. The draft affordable housing agreement is included as an attachment to the City Council resolution (Exhibit 1). The price and timing of the credit purchase is directed through City Council Policy Statement No. 57. If approved by the City Council, the funds received from the purchase of two affordable housing credits will be deposited into the city’s Housing Trust Fund to assist in the development of future affordable housing projects as well as programs to provide housing assistance to low- income households. Payment for the two affordable housing credits must be received before the city can issue a building permit for the project. Jan. 11, 2022 Item #4 Page 2 of 43 Options Staff provide the following options for the City Council’s consideration: 1. Authorize the purchase of two affordable housing credits and approve the affordable housing agreement as presented. Pros • This option keeps the development project on track to meet the city’s conditions. • Increases funds in the Housing Trust Fund available for the creation of additional affordable housing units. Cons • Does not result in the near-term construction of new affordable units as funds would be reinvested in future projects. 2. Do not approve the affordable housing agreement as presented. Pros • The developer would have to meet their inclusionary housing requirement in some other manner that could include the creation of new affordable units. Cons • The developer would have to satisfy their inclusionary requirement is some other manner, which may cause the project to be financially infeasible, potentially jeopardizing its viability. Staff and the Housing Commission recommend Option one, approving the purchase request. Fiscal Analysis The Affordable Housing Credit price for the Cassia Heights Apartments is $66,300 per credit. The developer of La Costa Villas North is required to purchase a total of two credits. This action would result in a payment of $132,600 to the city that would be deposited into the Housing Trust Fund. These funds will be used to assist in the development of future affordable housing projects as well as programs to provide housing assistance to low-income households, as appropriate. It should be noted that the developer and/or builder will pay the credit price in effect at the time that building permits are issued for the development. The affordable housing credit price for the Cassia Heights Apartments project has an annual escalator based on the Consumer Price Index. Therefore, it is possible that the developer may pay more than the credit price noted above depending upon any increases in the price of the credits that may take effect in the future. Next Steps Staff will process the implementing affordable housing agreement with the developer. The resolution authorizes the City Manager, or designee, to execute and record all necessary documents. Environmental Evaluation The City Planner has determined that the project is categorically exempt from the requirement for the preparation of environmental documents pursuant to Section 15332, Infill Project, of the state CEQA Guidelines. No further environmental review is required under California Environmental Quality Act Guidelines. Jan. 11, 2022 Item #4 Page 3 of 43 Public Notification and Outreach This item was noticed in keeping with the state's Ralph M. Brown Act and it was available for public viewing and review at least 72 hours before the scheduled meeting date. Exhibits 1. City Council resolution 2. Planning Commission Resolution 7427 3. Location map 4. City Council Policy No. 57 5. City Council Policy No. 58 6. City Council Policy No. 57 criteria and analysis 7. Housing Commission Resolution 2021-009 Jan. 11, 2022 Item #4 Page 4 of 43 RESOLUTION NO. 2022-003 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, AUTHORIZING THE PURCHASE OF TWO AFFORDABLE HOUSING CREDITS AND APPROVAL OF AN AFFORDABLE HOUSING AGREEMENT TO SATISFY THE INCLUSIONARY HOUSING REQUIREMENT FOR THE LA COSTA VILLAS NORTH PROJECT EXHIBIT 1 WHEREAS, 400 Gibraltar, LLC is under contract to build a nine-unit condominium project, known as La Costa Villas North, and is conditioned to provide two units affordable to low income households; and WHEREAS, the Planning Commission approved a Tentative Map for said development on October 20, 2021; and WHEREAS, the developer has requested to satisfy the inclusionary housing requirement through the purchase of two affordable housing credits as opposed to building on site, and WHEREAS, Carlsbad Municipal Code Chapter 21.85 allows the city to determine that an alternative to the construction of new inclusionary units is acceptable when it can be demonstrated by a developer that the city's housing goals would be better served by an alternative method; and WHEREAS, affordable housing credits from the Cassia Heights project in the southeast quadrant are available to purchase for this project; and WHEREAS, the city's Affordable Housing Policy Team reviewed the request on Feb. 22, 2021, to discuss the request and consider options, prior to presenting it to the Housing Commission for their consideration and recommendation to the City Council; and WHEREAS, the Housing Commission considered the request, staff evaluation and recommendation, and the testimony of all persons desiring to be heard on the matter at a special meeting on Nov. 18, 2021, and recommended that the City Council approve the request to purchase two affordable housing credits to satisfy their inclusionary housing requirement; and WHEREAS, the Housing Commission makes recommendations to the City Council for projects that propose to alternatively meet inclusionary housing requirements set forth in 21.85 of the Carlsbad Municipal Code; and WHEREAS, Carlsbad Municipal Code Chapter 21.85 requires the developer of a project to receive approval of an Affordable Housing Agreement which details how the requirements of the Jan. 11, 2022 Item #4 Page 5 of 43 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 (Purchase of Credits) THIS AFFORDABLE HOUSING AGREEMENT ("Agreement") is entered into this fq+L day of · tt~t-2022, by and between the CITY OF CARLSBAD, a municipal corporation ("Ci ") and 4 Gibraltar LLC ("Developer"), property owner, 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 "Exhibit A", which is attached hereto and incorporated herein by this reference, and which is the subject of a Tentative Map (CT2019-0001), which provides conditional approval of the construction of nine (9) condominium dwelling units ("Project"), known as La Costa Villas North. B. Chapter 21.85 of the Carlsbad Municipal Code requires that this Agreement shall be entered into between the City and the Developer as a means of satisfying the Developer's affordable housing obligation, as such is defined under Chapter 21.85 of the Carlsbad Municipal Code. Planning Commission Resolution No. 7427 includes a Condition to provide two (2) affordable unit ("Affordable Housing Obligation") based on a calculation that the units will be satisfied by the purchase of two (2) housing credits in a combined, off-site affordable housing development (Cassia Heights Affordable Development) on the border of both the Southeast and Southwest quadrants of the city, as provided for in Chapter 21.85, Section 21.85.080 as an alternative to construction of the affordable housing obligation on the site of the market rate units. 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. THAT SATISFACTION OF DEVELOPER'S AFFORDABLE HOUSING REQUIREMENT WILL BE BY THE PURCHASE OF AFFORDABLE HOUSING CREDITS. 1 CA 2/5/2013 Jan. 11, 2022 Item #4 Page 7 of 43 ( a) Performance under this Agreement satisfies the Developers' obligation for affordable housing under Chapter 21.85 of the Carlsbad Municipal Code as applied to the land covered by Carlsbad Tract No. 2019-0001 (CT2019-001) by reason of the approvals of the Tentative Map of CT 2019-0001, including Condition No. 25 of Planning Commission Resolution No. 7427, and any other applicable approval. (b) The Developer shall purchase two (2) affordable housing credits in the Cassia Heights Affordable Housing developments ( on the border of both the Southeast and Southwest Quadrants of the City of Carlsbad), based on availability, for an amount established by resolution of the City Council and as required by Condition No. 25 of Planrung Commission Resolution No. 7427 no later than two (2) years following City Council approval of this Agreement. The credit fee shall be paid in full prior to the Developer receiving any building permits for the project. The subject housing credits will be reserved for said Developer for no longer than (2) years following City Council approval of this Agreement. If the Developer does not purchase the subject credits within two (2) years of the date of this Agreement, the City shall make the credits available to one or more alternate developers and the Developer for this Agreement shall then be required to satisfy its inclusionary obligation through alternate methods as approved by the City. 3. RE:MEDIES 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. 25 of Planning Commission Resolution No. 7427. 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. 2019-0001 (CT2019-0001). 4. 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 attorneys' fees and expenses) sustained or incurred because of or by reason of any and all claims, demands, suits, or actions, obtained, allegedly caused by, arising out of or ·pertaining 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. This provision shall survive Ahe term of this Agreement. 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 address set forth below: TO THE CITY: TO THE DEVELOPER: City of Carlsbad Housing & Homeless Services Department Attn: Housing & Homeless Services Director 1200 Carlsbad Village Drive Carlsbad, California 92008 400 Gibraltar LLC 2 CA2/5/2013 Jan. 11, 2022 Item #4 Page 8 of 43 3525 Del Mar Heights Rd. #724 San Diego, Ca. 92130 Any party may change the ad~ress 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. THE REMAINDER OF TIDS PAGE HAS BEEN LEFT INTENTIONALLYBLANK 3 CA 2/5/2013 Jan. 11, 2022 Item #4 Page 9 of 43 EXHIBIT A LEGAL DESCRIPTION OF PROPERTY Lot 40 of La Costa South Unit No. 5, in the City of Carlsbad, County of San Diego, State of California, According to Map Thereof No. 6600 filed in the Office of the County Recorder of San Diego County, on March 10, 1970. 5 CA2/5/2013 Jan. 11, 2022 Item #4 Page 13 of 43 PLANNING COMMISSION RESOLUTION NO. 7427 A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY OF CARLSBAD, CALIFORNIA, APPROVING TENTATIVE TRACT MAP CT 2019- 0001 AND PLANNED DEVELOPMENT PERMIT PUD 2019-0001 TO CONSTRUCT A NINE-UNIT, RESIDENTIAL AIR-SPACE CONDOMINIUM PROJECT ON AN APPROXIMATELY .40-ACRE LOT LOCATED ON THE SOUTH SIDE OF GIBRALTAR STREET, AT THE INTERSECTION OF GIBRALTAR STREET AND JEREZ COURT (APN: 216-300-05-00), WITHIN LOCAL FACILITIES MANAGEMENT ZONE 6. CASE NAME: CASE NO.: LA COSTA VILLAS NORTH CT 2019-0001/PUD 2019-0001 (DEV2018-0135) WHEREAS, FOROOZANDEH SAHBA, "Developer/Owner," has filed a verified application with the City of Carlsbad regarding property described as LOT 40 OF LA COSTA SOUTH UNIT NO. 5, IN THE CITY OF CARLSBAD, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 6600 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, ON MARCH 10, 1970 ("the Property"); and WHEREAS, said verified application constitutes a request for a Tentative Tract Map and Planned Development Permit as shown on Exhibit(s) "A" -"QQ" dated October 20, 2021, on file in the Planning Division CT 2019-0001/PUD 2019-0001-LA COSTA VILLAS NORTH, as provided by Chapters 21.24, 21.45 and 20.12 of the Carlsbad Municipal Code; and WHEREAS, the Planning Commission did, on October 20, 2021, hold a duly noticed public hearing as prescribed by law to consider said request; and WHEREAS, at said public hearing, upon hearing and considering all testimony and arguments, if any, of persons desiring to be heard, said Commission considered.all factors relating to the Tentative Tract Map and Planned Development Permit. NOW, THEREFORE, BE IT HEREBY RESOLVED by the Planning Commission of the City of Carlsbad as follows: A) That the foregoing recitations are true and correct. B) That based on the evidence presented at the public hearing, the Commission APPROVES CT 2019-0001/PUD 2019-0001-LA COSTA VILLAS NORTH, based on the following findings and subject to the following conditions: Exhibit 2 Jan. 11, 2022 Item #4 Page 14 of 43 Findings: Tentative Tract Map 1. That the proposed map and the proposed design and improvement of the subdivision as conditioned, is consistent with and satisfies all requirements of the General Plan, any applicable specific plans, Titles 20 and 21 of the Carlsbad Municipal Code, and the State Subdivision Map Act, and will not cause serious public health problems, in that the nine-unit residential air-space condominium project created through the tentative tract map satisfies all the minimum requirements of Title 20 and has been designed to comply with other applicable regulations including the Residential Density-Multiple (RD-M) Zone, the Planned Development Ordinance, Growth Management Ordinance, and the R-23 General Plan Land Use designation. 2. That the proposed project is compatible with the surrounding future land uses since surrounding properties to the north, south, and west have a General Plan Land Use designation as R-23 Residential and are developed with multi-family residential uses, and the abutting vacant property to the east also has a R-23 Residential designation and can be developed with a similar multi-family residential use. Given the existing surrounding development, the air-space residential condominium project is compatible with existing and future land uses. 3. That the site is physically suitable for the type and density of the development since the site is adequate in size and shape to accommodate residential development at the density proposed, in that all required development standards and design criteria required by the Residential Density -Multiple (RD-M) Zone and the Planned Development Ordinance are incorporated into the nine-unit residential air-space condominium project without the need for any variances from development standards. 4. That the design of the subdivision or the type of improvements will not conflict with easements of record or easements established by court judgment, or acquired by the public at large, for access through or use of property within the proposed subdivision, in that there are no easements of record or easements established by court judgment for access through or use of the property within the property. 5. That the property is not subject to a contract entered into pursuant to the Land Conservation Act of 1965 (Williamson Act). 6. That the design of the subdivision provides, to the extent feasible, for future passive or natural heating or cooling opportunities in the subdivision, in that structures have been designed to include operable windows on all elevations and balconies to maximize exposure of each unit to natural light and ventilation from nearby coastal breezes, if desired. 7. That the Planning Commission has considered, in connection with the housing proposed by this subdivision, the housing needs of the region, and balanced those housing needs against the public service needs of the city and available fiscal and environmental resources in that the applicant proposes to purchase two affordable housing credits to satisfy their inclusionary housing obligations and to meet the housing needs of the region. As such, the project has been conditioned to require the purchase of two affordable housing credits prior to building permit issuance. 8. That the design of the subdivision and improvements are not likely to cause substantial environmental damage nor substantially and avoidably injure fish or wildlife or their habitat, in PC RESO NO. 7427 -2- Jan. 11, 2022 Item #4 Page 15 of 43 that the nine-unit residential air-space condominium project site is surrounded by existing multi-family development. 9. That the discharge of waste from the subdivision will not result in violation of existing California Regional Water Quality Control Board requirements, in that the project will adhere to the city's Master Drainage Plan, Grading Ordinance, Storm Water Ordinance, BMP Design Manual and Jurisdictional Runoff Management Program (JRMP) to avoid increased urban runoff, pollutants, and soil erosion. Planned Development Permit 10. The proposed project is consistent with the general plan, and complies with all applicable provisions of this chapter, and all other applicable provisions of the Carlsbad Municipal Code, in that the density of 22.5 dwelling units per acre (du/ac) for the nine-unit residential air-space condominium project is consistent with the R-23 Residential Land Use designation (15-23 du/acre). As discussed in the project staff report, the project is consistent with all minimum development and design standards applicable to the property as contained in Chapters 21.24 (Residential Density-Multiple (RD-M)) Zone and 21.45 (Planned Developments) of the Carlsbad Municipal Code. 11. The proposed project will not be detrimental to existing uses, or to uses specifically permitted in the area in which the proposed use is to be located, and will not adversely impact the site, surroundings, or traffic, in that the nine-unit residential air-space condominium project does not propose or require any variances from standards, is compatible with existing surrounding uses as permitted by the Residential Density-Multiple (RD-M) Zone, and does not create any traffic circulation impacts as Gibraltar Street is adequately designed to accommodate the 72 Average Daily Trips (ADT) being generated. 12. The project will not adversely affect the public health, safety, or general welfare, in that the nine- unit residential air-space condominium project has been designed to comply with all applicable development standards to ensure compatibility with surrounding single-family and multiple- family residential uses. 13. The project's design, including architecture, streets, and site layout a) contributes to the community's overall aesthetic quality; b) includes the use of harmonious materials and colors, and the appropriate use of landscaping; and c) achieves continuity among all elements of the project, in that the nine-unit residential air-space condominium project is designed with two separate buildings that is situated along a private drive aisle that is enhanced by decorative pavers. The two, three-story buildings with attached garages are architecturally harmonious with each other and include a variety of exterior materials and colors. Primary building materials include white stucco and gray siding with complimentary design elements such as varied roof planes, varied window sizes and shapes, metal railings and eyebrows at window heads. All elements (i.e. site layout, architecture, landscaping) create continuity in the overall project design. General 14. The Planning Commission finds that the project, as conditioned herein, is in conformance with the Elements of the city's General Plan based on the facts set forth in the staff report dated October 20, 2021, including, but not limited to the following: A. Land Use -The nine-unit residential project density of 22.5 du/ac is within the R-23 Residential density range. The R-23 General Plan Land Use designation for the property also PC RESO NO. 7427 -3-Jan. 11, 2022 Item #4 Page 16 of 43 has a Growth Management Control (GMCP) Point of 19 du/ac. The GMCP is a tool utilized by the city to track anticipated growth within the city and to plan for future needs. In compliance with Senate Bill 330, Government Code Section 66300 (b)(l)(D), and City Council action (Resolution No. 2021-074) the GMCP cannot act as a residential housing cap. At the GMCP, eight dwelling units would be permitted on this 0.40-net-developable-acre property. With nine units proposed, one dwelling unit will be withdrawn from the Excess Dwelling Unit Bank for residential unit tracking purposes only; and therefore, the proposed density is consistent with the R-23 General Plan Land Use designation. B. Mobility -The proposed project has been designed to meet applicable circulation requirements, which include a single driveway access point from Gibraltar Street. In addition, the applicant will be required to pay traffic impact fees prior to issuance of a building permit that will go towards future road improvements. C. Public Safety -The proposed structural improvements are required to be designed in conformance with all seismic design standards. In addition, the proposed project is consistent with all the applicable fire safety requirements. D. Noise -The project consists of nine residential condominiums located in two buildings. A noise study Eilar Associates, Inc., dated April 25, 2019 was provided. The exterior required private recreation areas are below the maximum 60 dB(a) CNEL noise level as designed, therefore, the project design complies. The interior noise levels will comply with the 45 dB(a) CNEL requirement with typical building construction and no special design features are required for meeting the interior noise limits. E. Housing -As nine units are proposed, not less than 15 percent of the total units or two units shall be constructed and restricted both as to occupancy and affordability to lower-income households. Pursuant to CMC Section 21.85.070, when new construction is determined to be infeasible or present a hardship, alternatives to the construction of a unit onsite may be permitted. On March 15, 2021, the Housing Policy Team recommended approval of the applicant's request to purchase two affordable housing credits from the Cassia Heights affordable housing credit bank. The project is conditioned to purchase the two housing credits prior to building permit issuance. 15. The project is consistent with the Citywide Facilities and Improvements Plan, the Local Facilities Management Plan for Zone 6 and all city public facility policies and ordinances. The project includes elements or has been conditioned to construct or provide funding to ensure that all facilities and improvements regarding sewer collection and treatment; water; drainage; circulation; fire; schools; parks and other recreational facilities; libraries; government administrative facilities; and open space, related to the project will be installed to serve new development prior to or concurrent with need. Specifically, A. The project has been conditioned to provide proof from the Encinitas Unified School District that the project has satisfied its obligation for school facilities. B. Park-in-lieu fees are required by Carlsbad Municipal Code Chapter 20.44 and will be collected prior to issuance of building permit. C. The Public Facility fee is required to be paid by Council Policy No. 17 and will be collected prior to the issuance of building permit. D. The Local Facilities Management fee for Zone 6 is required by Carlsbad Municipal Code Section 21.90.050 and will be collected prior to issuance of building permit. PC RESO NO. 7427 -4- Jan. 11, 2022 Item #4 Page 17 of 43 16. That the project is consistent with the city's Landscape Manual and Water Efficient Landscape Ordinance (Carlsbad Municipal Code Chapter 18.50). 17. That the City Planner has determined that the project belongs to a class of projects that the State Secretary for Resources has found do not have a significant impact on the environment, and it is therefore categorically exempt from the requirement for the preparation of environmental documents pursuant to Section 15332, In-fill Development Project, of the state CEQA Guidelines. 18. The Planning Commission has reviewed each of the exactions imposed on the Developer contained in this resolution, and hereby finds, in this case, that the exactions are imposed to mitigate impacts caused by or reasonably related to the project, and the extent and the degree of the exaction is in rough proportionality to the impact caused by the project. Conditions: NOTE: Unless otherwise specified herein, all conditions shall be satisfied prior to the issuance of grading permit, building permit, or recordation of the Final Map, whichever occurs first. 1. If any of the following conditions fail to occur, or if they are, by their terms, to be implemented and maintained over time, if any of such conditions fail to be so implemented and maintained according to their terms, the city shall have the right to revoke or modify all approvals herein granted; deny or further condition issuance of all future building permits; deny, revoke, or further condition all certificates of occupancy issued under the authority of approvals herein granted; record a notice of violation on the property title; institute and prosecute litigation to compel their compliance with said conditions or seek damages for their violation. No vested rights are gained by Developer or a successor in interest by the city's approval of this Tentative Tract Map and Planned Development Permit. 2. Staff is authorized and directed to make, or require the Developer to make, all corrections and modifications to the Tentative Tract Map and Planned Development Permit documents, as necessary to make them internally consistent and in conformity with the final action on the project. Development shall occur substantially as shown on the approved Exhibits. Any proposed development, different from this approval, shall require an amendment to this approval. 3. Developer shall comply with all applicable provisions of -federal, state, and local laws and regulations in effect at the time of building permit issuance. 4. If any condition for construction of any public improvements or facilities, or the payment of any fees in-lieu thereof, imposed by this approval or imposed by law on this Project are challenged, this approval shall be suspended as provided in Government Code Section 66020. If any such condition is determined to be invalid, this approval shall be invalid unless the City Council determines that the project without the condition complies with all requirements of law. 5. Developer/Operator shall and does hereby agree to indemnify, protect, defend, and hold harmless the City of Carlsbad, its Council members, officers, employees, agents, and representatives, from and against any and all liabilities, losses, damages, demands, claims and costs, including court costs and attorney's fees incurred by the city arising, directly or indirectly, from (a) the city's approval and issuance of this Tentative Tract Map and Planned Development Permit, (b) the city's approval or issuance of any permit or action, whether discretionary or nondiscretionary, in connection with the use contemplated herein, and (c) Developer/Operator's installation and operation of the facility permitted hereby, including without limitation, any and all liabilities arising from the emission by the facility of electromagnetic fields or other energy PC RESO NO. 7427 -5-Jan. 11, 2022 Item #4 Page 18 of 43 waves or em1ss1ons. This obligation survives until all legal proceedings have been concluded and continues even if the city's approval is not validated. 6. Prior to submittal of the building plans, improvement plans, grading plans, or final map, whichever occurs first, developer shall submit to the City Planner, a 24" x 36" copy of the Tentative Map, conceptual grading plan and preliminary utility plan reflecting the conditions approved by the final decision-making body. The copy shall be submitted to the City Planner, reviewed and, if found acceptable, signed by the city's project planner and project engineer. If no changes were required, the approved exhibits shall fulfill this condition. 7. Prior to the issuance of a building permit, the Developer shall provide proof to the Building Division from the Encinitas Unified School District that this project has satisfied its obligation to provide school facilities. 8. This project shall comply with all conditions and mitigation measures which are required as part of the Zone 6 Local Facilities Management Plan and any amendments made to that Plan prior to the issuance of building permits. 9. This approval shall become null and void if building permits are not issued for this project within 24 months from the date of project approval unless a time extension is filed in a timely manner and approved by the City of Carlsbad. 10. Building permits will not be issued for this project unless the local agency providing water and sewer services to the project provides written certification to the city that adequate water service and sewer facilities, respectively, are available to the project at the time of the application for the building permit, and that water and sewer capacity and facilities will continue to be available until the time of occupancy. A note to this effect shall be placed on the Final Map. 11. Developer shall pay the citywide Public Facilities Fee imposed by City Council Policy #17, the License Tax on new construction imposed by Carlsbad Municipal Code Section 5.09.030, subject to any credits authorized by Carlsbad Municipal Code Section 5.09.040. Developer shall also pay any applicable Local Facilities Management Plan fee for Zone 6, pursuant to Chapter 21.90. All such taxes/fees shall be paid at issuance of building permit. If the taxes/fees are not paid, this approval will not be consistent with the General Plan and shall become void. 12. Prior to approval of the Final Map, Developer shall submit to the city a Notice of Restriction executed by the owner of the real property to be developed. Said notice is to be filed in the office of the County Recorder, subject to the satisfaction of the City Planner, notifying all interested parties and successors in interest that the City of Carlsbad has issued a Tentative Tract Map and Planned Development Permit by Resolution No. 7427 on the property. Said Notice of Restriction shall note the property description, location of the file containing complete project details and all conditions of approval as well as any conditions or restrictions specified for inclusion in the Notice of Restriction. The City Planner has the authority to execute and record an amendment to the notice which modifies or terminates said notice upon a showing of good cause by the Developer or successor in interest. 13. Developer shall make a separate formal landscape construction drawing plan check submittal to the Planning Division and obtain City Planner approval of a Final Landscape and Irrigation Plan showing conformance with the approved Preliminary Landscape Plan and the city's Landscape Manual. Developer shall construct and install all landscaping and irrigation as shown on the approved Final Plans. All landscaping shall be maintained in a healthy and thriving condition, free from weeds, trash, and debris. All irrigation systems shall be maintained to provide the PC RESO NO. 7427 -6-Jan. 11, 2022 Item #4 Page 19 of 43 optimum amount of water to the landscape for plant growth without causing soil erosion and runoff. 14. The first submittal of Final Landscape and Irrigation Plans shall be pursuant to the landscape plan check process on file in the Planning Division and accompanied by the project's building, improvement, and grading plans. 15. This project is being approved for residential homeownership purposes. If any of the units in the project are rented, the minimum time increment for such rental shall be not less than 30 days. The CC&Rs for the project shall include this requirement. 16. Developer shall establish a homeowner's association and corresponding covenants, conditions and restrictions (CC&Rs}. Said CC&Rs shall be subm itted to and approved by the City Planner prior to final map approval. Prior to Certificate of Occupancy, the Developer shall provide the Planning Division with a recorded copy of the official CC&Rs that have been approved by the Department of Real Estate and the City Planner. A "hold" will be placed on the building permit (i.e., Certificate of Occupancy) to ensure that said CC&Rs are received prior to issuance of Certificate of Occupancy. At a minimum, the CC&Rs shall contain the following provisions: A. General Enforcement by the City: The city shall have the right, but not the obligation, to enforce those Protective Covenants set forth in this Declaration in favor of, or in which the city has an interest. B. Notice and Amendment: A copy of any proposed amendment shall be provided to the city in advance. If the proposed amendment affects the city, the city shall have the right to disapprove. A copy of the final approved amendment shall be transmitted to city within 30 days for the official record. C. Failure of Association to Maintain Common Area Lots and Easements: In the event that the Association fails to maintain the "Common Area Lots and/or the Association's Easements" as provided in Article---~ Section ______ the city shall have the right, but not the duty, to perform the necessary maintenance. If the city elects to perform such maintenance, the city shall give written notice to the Association, with a copy thereof to the Owners in the Project, setting forth with particularity the maintenance which the city finds to be required and requesting the same be carried out by the Association within a period of thirty (30} days from the giving of such notice. In the event that the Association fails to carry out such · maintenance of the Common Area Lots and/or Association's Easements within the period specified by the city's notice, the city shall be entitled to cause such work to be completed and shall be entitled to reimbursement with respect thereto from the Owners as provided herein. D. Special Assessments Levied by the city: In the event the city has performed the necessary maintenance to either Common Area Lots and/or Association's Easements, the city shall submit a written invoice to the Association for all costs incurred by the city to perform such maintenance of the Common Area Lots and or Association's Easements. The city shall provide a copy of such invoice to each Owner in the Project, together with a statement that if the Association fails to pay such invoice in full within the time specified, the city will pursue collection against the Owners in the Project pursuant to the provisions of this Section. Said invoice shall be due and payable by the Association within twenty days of receipt by the Association. If the Association shall fail to pay such invoice in full within the period specified, payment shall be deemed delinquent and shall be subject to a late charge in an amount equal to six percent of the amount of the invoice. Thereafter the city may pursue collection from the Association by means of any remedies available at law or in equity. Without limiting the PC RESO NO. 7427 -7-Jan. 11, 2022 Item #4 Page 20 of 43 generality of the foregoing, in addition to all other rights and remedies available to the city, the city may levy a special assessment against the Owners of each Lot in the Project for an equal pro rata share of the invoice, plus the late charge. Such special assessment shall constitute a charge on the land and shall be a continuing lien upon each Lot against which the special assessment is levied. Each Owner in the Project hereby vests the city with the right and power to levy such special assessment, to impose a lien upon their respective Lot and to bring all legal actions and/or to pursue lien foreclosure procedures against any Owner and his/her respective Lot for purposes of collecting such special assessment in accordance with the procedures set forth in Article ____ of this Declaration. E. Landscape Maintenance Responsibilities: The HOAs and individual lot or unit owner landscape maintenance responsibilities shall be as set forth in Exhibit _____ _ F. Balconies, trellis, and decks: The individual lot or unit owner allowances and prohibitions regarding balconies, trellis, and decks shall be as set forth in Exhibit ____ _ 17. Prior to Certificate of Occupancy, the Developer shall submit to the City Planner a recorded copy of the Condominium Plan filed with the Department of Real Estate which is in conformance with the city-approved documents and exhibits. 18. All roof appurtenances, including air conditioners, shall be architecturally integrated and concealed from view and the sound buffered from adjacent properties and streets, in substance as provided in Building Department Policy No. 80-6, to the satisfaction of the Directors of Community Development and Planning. 19. If satisfaction of the school facility requirement involves a Mello-Roos Community Facilities District or other financing mechanism which is inconsistent with City Council Policy No. 38, by allowing a pass-through of the taxes or fees to individual home buyers, then in addition to any other disclosure required by law or Council policy, the Developer shall disclose to future owners in the project, to the maximum extent possible, the existence of the tax or fee, and that the school district is the taxing agency responsible for the financing mechanism. The form of notice is subject to the approval of the City Planner and shall at least include a handout and a sign inside the sales facility, or inside each unit, stating the fact of a potential pass-through of fees or taxes exists and where complete information regarding those fees or taxes can be obtained. 20. Developer shall display a current Zoning and Land Use Map, or an alternative, suitable to the City Planner, in the sales office or inside each unit, at all times. All sales maps that are distributed or made available to the public shall include but not be limited to trails, future and existing schools, parks, and streets. 21. Developer shall post a sign in the sales office, or inside each unit, in a prominent location that discloses which special districts and school district provide service to the project. Said sign shall remain posted until ALL of the units are sold. 22. No outdoor storage of materials shall occur onsite unless required by the Fire Chief. When so required, the Developer shall submit and obtain approval of the Fire Chief and the City Planner of an Outdoor Storage Plan, and thereafter comply with the approved plan. 23. Developer shall construct trash receptacle and recycling areas enclosed by a six-foot-high masonry wall with gates pursuant to City Engineering Standards and Carlsbad Municipal Code Chapter 21.105. Location of said receptacles shall be approved by the City Planner. Enclosure shall be of similar colors and/or materials to the project to the satisfaction of the City Planner. PC RESO NO. 7427 -8-Jan. 11, 2022 Item #4 Page 21 of 43 24. Developer shall submit and obtain City Planner approval of an exterior lighting plan including parking areas. All lighting shall be designed to reflect downward and avoid any impacts on adjacent homes or property. 25. Prior to the approval of the final map for any phase of the project, or where a map is not being processed, prior to the issuance of building permits for any lots or units, the Developer shall enter into an Affordable Housing Agreement with the city to purchase two (2) affordable housing credits from the City of Carlsbad in the Cassia Heights affordable housing credit bank (a combined offsite affordable housing development) to meet the inclusionary housing requirements set forth in Chapter 21.85 of the Carlsbad Municipal Code for residential developments. The individual credit purchase shall be the amount in effect at the time of purchase, as established by City Council Resolution from time to time and shall be purchased at the time of building permit issuance. The draft Affordable Housing Agreement shall be submitted to the City Planner no later than 60 days prior to the request to final the map. The recorded Affordable Housing Agreement shall be binding on all future owners and successors in interest. Engineering: NOTE: Unless specifically stated in the condition, all of the following conditions, upon the approval of this proposed subdivision, must be met prior to approval of a final map, building permit or grading plan whichever occurs first. 26. Prior to hauling dirt or construction materials to or from any proposed construction site within this project, developer shall apply for and obtain approval from, the city engineer for the proposed haul route. 27. This project is approved upon the express condition that building permits will not be issued for the development of the subject property, unless the district engineer has determined that adequate water and sewer facilities are available at the time of permit issuance and will continue to be available until time of occupancy. 28. Developer shall submit to the city engineer an acceptable instrument, via CC&Rs and/or other recorded document, addressing the maintenance, repair, and replacement of shared private improvements within this subdivision, including but not limited to private driveway, utilities, sidewalks, landscaping, enhanced paving, biofiltration basin, low impact development features, storm drain facilities, etc. located therein and to distribute the costs of such maintenance in an equitable manner among the owners of the properties within this subdivision. 29. Developer shall include rain gutters on the building plans subject to the city engineer's review and approval. Developer shall install rain gutters in accordance with said plans. 30. Developer shall prepare, submit and process for city engineer approval a final map to subdivide this project. There shall be one Final Map recorded for this project. Developer shall pay the city standard map review plan check fees. 31. Developer shall install sight distance corridors at all street intersections and driveways in accordance with City Engineering Standards. The property owner shall maintain this condition. 32. Deve loper shall cause property owner to execute and submit to the city engineer for recordation, the city's standard form Geologic Failure Hold Harmless Agreement. 33 . Developer shall cause property owner to execute and submit to the city engineer for recordation the city's standard form Drainage Hold Harmless Agreement. PC RESO NO. 7427 -9-Jan. 11, 2022 Item #4 Page 22 of 43 34. Developer shall cause property owner to submit an executed copy to the city engineer for recordation a city standard Permanent Stormwater Quality Best Management Practice Maintenance Agreement. 35. Based upon a review of the proposed grading and the grading quantities shown on the tentative map, a grading permit for this project is required. Developer shall prepare and submit plans and technical studies/reports as required by city engineer, post security and pay all applicable grading plan review and permit fees per the city's latest fee schedule. 36. This project may require off site grading. No grading for private improvements shall occur outside the project unless developer obtains, records, and submits a recorded copy, to the city engineer, a temporary grading, construction or slope easement or agreement from the owners of the affected properties. If developer is unable to obtain the temporary grading or slope easement, or agreement, no grading permit will be issued. In that case developer must either apply for and obtain an amendment of this approval or modify the plans so grading will not occur outside the project and apply for and obtain a finding of substantial conformance and/or consistency determination from both the city engineer and city planner. 37. Prior to approval of the grading plans, the applicant shall submit a Construction Plan to the city engineer for review and approval. Said plan may be required to include, but not be limited to, identifying the location of the construction trailer, material staging, material deliveries, bathroom facilities, parking of construction vehicles, employee parking, construction fencing and gates, obtaining any necessary permission for off-site encroachment, addressing pedestrian safety, and identifying time restrictions for various construction activities. All material staging, construction trailers, bathroom facilities, etc. shall be located outside the public right-of-way unless otherwise approved by the city engineer or Construction Management & Inspection engineering manager. 38. Concurrent with the grading plans Developer shall include shoring plans as part of the grading plans to the satisfaction of the city engineer and building official. Structural calculations for all shoring shall be submitted for review and approval by the building division. Developer shall pay all deposits necessary to cover any 3rd party review. 39. Developer shall comply with the city's Stormwater Regulations, latest version, and shall implement best management practices at all times. Best 'management practices include but are not limited to pollution control practices or devices, erosion control to prevent silt runoff during construction, general housekeeping practices, pollution prevention and educational practices, maintenance procedures, and other management practices or devices to prevent or reduce the discharge of pollutants to stormwater, receiving water or stormwater conveyance system to the maximum extent practicable. Developer shall notify prospective owners and tenants of the above requirements. 40. Developer shall complete and submit to the city engineer a Determination of Project's SWPPP Tier Level and Construction Threat Level Form pursuant to City Engineering Standards. Developer shall also submit the appropriate Tier level Storm Water Compliance form and appropriate Tier level Storm Water Pollution Prevention Plan (SWPPP) to the satisfaction of the city engineer. Developer shall pay all applicable SWPPP plan review and inspection fees per the city's latest fee schedule. 41. This project is subject to 'Priority Development Project' requirements. Developer shall prepare and process a Storm Water Quality Management Plan (SWQMP), subject to city engineer approval, to comply with the Carlsbad BMP Design Manual latest version. The final SWQMP required by this condition shall be reviewed and approved by the city engineer with final grading PC RESO NO. 7427 -10-Jan. 11, 2022 Item #4 Page 23 of 43 plans. Developer shall pay all applicable SWQMP plan review and inspection fees per the city's latest fee schedule. 42. Developer is responsible to ensure that all final design plans (grading plans, improvement plans, landscape plans, building plans, etc.) incorporate all source control, site design, pollutant control BMP and applicable hydromodification measures. 43. Developer shall design the private drainage systems, as shown on the tentative map to the satisfaction of the city engineer. All private drainage systems (12" diameter storm drain and larger) shall be inspected by the city. Developer shall pay the standa rd improvement plan check and inspection fees for private drainage systems. 44. Developer shall prepare and process public improvement plans and, prior to city engineer approval of said plans, shall execute a city standard Subdivision Improvement Agreement to install and shall post security ih accordance with C.M.C. Section 20.16.070 for public improvements shown on the tentative map. Said improvements shall be installed to city standards to the satisfaction of the city engineer. These improvements include, but are not limited to: A. Curb and gutter B. Driveway C. Water services and meters D. A.C. grind and overlay E. Curb outlet Developer shall pay the standard improvement plan check and inspection fees in accordance with the fee schedule. Improvements listed above shall be constructed within 36 months of approval of the subdivision or development improvement agreement or such other time as provided in said agreement. 45. Developer is responsible to ensure utility transformers or raised water backflow preventers that serve t his development are located outside the right-of-way as shown on the Tentative Map and to the satisfaction of the city engineer. These facilities shall be constructed within the property. 46. Add the following notes to the final map as non-mapping data: A. Developer has executed a city standard Subdivision Improvement Agreement and has posted security in accordance with C.M.C. Sect ion 20.16.070 to install public improvements shown on the tentative map. These improvements include, but are not limited to: 1) Curb and gutter. 2) Driveway. 3) Water services and meters 4) A.C. grind and overlay. 5) Curb outlet. B. Building permits will not be issued for development of the subject property unless the appropriate agency determines that sewer and water facilities are available. C. Geotechnical Caution: 1) Slopes steeper than two parts horizontal to one-part vertical exist within the boundaries of this subdivision. 2) The owner of this property on behalf of itself and all of its successors in interest has agreed to hold harmless and indemnify the City of Carlsbad from any action PC RESO NO. 7427 -11-Jan. 11, 2022 Item #4 Page 24 of 43 that may arise through any geological failure, ground water seepage or land subsidence and subsequent damage that may occur on, or adjacent to, this subdivision due to its construction, operation or maintenance. D. No structure, fence, wall, tree, shrub, sign, or other object may be placed or permitted to encroach within the area identified as a sight distance corridor as defined by City of Carlsbad Engineering Standards or line-of-sight per Caltrans standards. E. The owner of this property on behalf of itself and all of its successors in interest has agreed to hold harmless and indemnify the City of Carlsbad from any action that may arise through any diversion of waters, the alteration of the normal flow of surface waters or drainage, or the concentration of surface waters or drainage from the drainage system or other improvements identified in the city approved development plans; or by the design, construction or maintenance of the drainage system or other improvements identified in the city approved development plans. F. There are no public park or recreational facilities to be located in whole or in part within this subdivision. The subdivider is therefore obligated to pay park-in-lieu fees in accordance with section 20.44.050 of the Carlsbad Municipal Code and has either paid all of said park in-lieu fees or agreed to pay all of said park-in-lieu fees in accordance with section 20.16.070 of the Carlsbad Municipal Code. 47. Developer shall meet with the fire marshal to determine if fire protection measures (fire flows, fire hydrant locations, building sprinklers) are required to serve the project. 48. Developer shall install potable water and/or recycled water services and meters at locations approved by the district engineer. The locations of said services shall be reflected on public improvement plans. 49. The potable water service for this project shall be master-metered subject to approval by the district engineer. Developer shall install private sub-meters as necessary for all proposed units. Final meter design, backflow preventer, size, and manufacturer shall be provided to the satisfaction of the district engineer and shown on public improvement plans. 50. The developer shall meet with and obtain approval from the Leucadia Wastewater District regarding sewer infrastructure available or required to serve this project. Code Reminders The project is subject to all applicable provisions of local ordinances, including but not limited to the following: 51. Approval of this request shall not excuse compliance with all applicable sections of the Zoning Ordinance and all other applicable city ordinances in effect at time of building permit issuance, except as otherwise specifically provided herein. 52. Premise identification (addresses) shall be provided consistent with Carlsbad Municipal Code Section 17.04.060. Prior to submittal for a building permit, Developer shall submit a request for addressing to the Building Division. 53. Any signs proposed for this development shall at a minimum be designed in conformance with the city's Sign Ordinance and shall require review and approval of the City Planner prior to installation of such signs. PC RESO NO. 7427 -12-Jan. 11, 2022 Item #4 Page 25 of 43 54. This tentative map shall expire two years from the date on which the application is approved. 55. Developer shall pay a landscape plan check and inspection fee as required by Section 20.08.050 of the Carlsbad Municipal Code. 56 . Developer shall pay park-in-lieu fees in accordance with Section 20.44 of the City of Carlsbad Municipal Code to the satisfaction of the City Engineer. 57. Developer shall pay planned local area drainage fees in accordance with Section 15.08.020 of the City of Carlsbad Municipal Code to the satisfaction of the City Engineer. 58 . Developer shall pay traffic impact and sewer impact fees based on Section 18.42 and Section 13.10 of the City of Carlsbad Municipal Code, respectively. The Average Daily Trips (ADT) and floor area contained in the staff report and shown on the tentative map are for planning purposes only. 59. Developer acknowledges that the project is required to comply with the city's greenhouse gas (GHG) reduction ordinances and requirements. GHG reduction requirements are in accordance with, but are not limited to, Carlsbad Municipal Code Chapters 18.21, 18.30, and 18.51 in addition to the California Green Building Standards Code (CCR, Title 24, Part 11-CALGreen), as amended from time to time. GHG reduction requirements may be different than what is proposed on the project plans or in the Climate Action Plan Checklist originally submitted with this project. Developer acknowledges that new GHG reduction requirements related to energy efficiency, photovoltaic, electric vehicle charging, water heating and traffic demand management requirements as set forth in the ordinances and codes may impact, but are not limited to, site design and local building code requirements. If incorporating GHG reduction requirements results in substantial modifications to the project, then prior to issuance of development (grading, building, etc.) permits, Developer may be required to submit and receive approval of a Consistency Determination or Amendment for this project through the Planning Division. Compliance with the applicable GHG reduction requirements must be demonstrated on or with the construction plans prior to issuance of the applicable development permits. NOTICE TO APPLICANT An appeal of this decision to the City Council must be filed with the City Clerk at 1200 Carlsbad Village Drive, Carlsbad, California, 92008, within ten {10) calendar days of the date of the Planning Commission's decision. Pursuant to Carlsbad Municipal Code Chapter 21.54, section 21.54.150, the appeal must be in writing and state the reason(s) for the appeal. The City Council must make a determination on the appeal prior to any judicial review. PC RESO NO. 7427 -13- Jan. 11, 2022 Item #4 Page 26 of 43 EXHIBIT 3 LA COSTA VILLAS NORTH LOCATION MAP Jan. 11, 2022 Item #4 Page 28 of 43 r CITY OF CARLSBAD COUNCIL POLICY STATEMENT General Subject: Specific Subject: AFFORDABLE HOUSING Off-site and Combined Inclusionary Housing Projects Policy No. --"'-57'------­Date Issued August 8, 1995 Effective Date August 8. 19 9 5 Cancellation Date ------Supersedes No. ______ _ Copies to: City Council, City Manager, City Attorney, Department and Division Heads, Employee Bulletin Boards, Press, File. BACKGROUND The City's Inclusionary 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 inclusionary units "should be built on-site and, wherever reasonably possible, be distributed throughout the project site." The Ordinance also 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 and operated at an alternative site or sites." This alternative is described as a "Combined Inclusionary Housing Project" or "Combined Project". The Ordinance, in addressing Combined Projects, states that "it is the exclusive prerogative of the final decision making authority of the City to determine whether or not it is in the public interest to authorize the residential sites to form a Combined Inclusionary Housing Project. " PURPOSE It is the purpose of this policy to establish the criteria which will 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. POLICY The following criteria will be applied in order to make the necessary public interest finding. Each criteria is defined in terms of specific questions which, when affirmatively answered, would support an off-site option: Pagel of 4 EXHIBIT 4 Jan. 11, 2022 Item #4 Page 29 of 43 CITY OF CARLSBAD COUNCIL POLICY STATEMENT General Subject: Specific Subject: AFFORDABLE HOUSING Off-site and Combined Inclusionary Housing Projects Policy No. --=57�----­Date Issued August 8, 1995 Effective Date August 8. 1995 Cancellation Date ------Supersedes No. ______ _ Copies to: City Council, City Manager, City Attorney, Department and Division Heads, Employee Bulletin Boards, Press, File. 1.Feasibility of the On-site Proposal.► Are there significant feasibility issues due to factors such as project size, site constraints, andcompetition from multiple projects that make an on-site option impractical?► Will an affordable housing product be difficult to integrate into the proposed marketdevelopment because of significant price and product type disparity?► Does the on-site development entity lack the capacity to deliver the proposed affordablehousing on-site?2.Relative Advantages/Disadvantages of the Off-site Proposal► Does the off-site option offer greater feasibility and cost effectiveness than the on-sitealternative, particularly regarding potential local public assistance and when applying theCity's Affordable Housing Financial Assistance Policy.► Does the off-site proposal have location advantages over the on-site alternative, such asproximity to jobs, schools, transportation, services; less impact on other existingdevelopments, etc.?► Does the off-site option offer a development entity with the capacity to deliver the proposedproject?► Does the off-site option satisfy multiple developer obligations that would be difficult to satisfywith multiple projects?Page 2 of 4 Jan. 11, 2022 Item #4 Page 30 of 43 CITY OF CARLSBAD COUNCIL POLICY STATEMENT Policy No. __ 5�7�----­Date Issued August 8. 1995 Effective Date August 8. 1995 Cancellation Date _____ _ Supersedes No. ______ _ General Subject: AFFORDABLE HOUSING Specific Subject: Off-site and Combined Inclusionary Housing Projects Copies to: City Council, City Manager, City Attorney, Departmlnt and Division Heads, Employee Bulletin Boards, Press, File. 3.Advancing Housing Goals► Does the off-site proposal advance and/or support City housing goals and policies asexpressed in the Housing Element, CHAS and Inclusionary Housing Ordinance?It is likely that off-site proposals will involve "mixed" results with the application of the above criteria. The "public interest" finding shall be made when a Combined Project Review Committee made up of the City Manager, City Attorney, Community Development Director, Financial Management Director, Planning Director, Housing & Redevelopment Director, and the Mayor (ex-officio), reaches consensus that a proposal substantially and affirmatively satisfies the above criteria and that this conclusion can be appropriately documented through the use of a Combined/Off-site Project Evaluation Assessment Worksheet. (Attachment 1). PROCEDURE 1.Projects with an inclusionary housing obligation will be processed according to the requirements ofthe Inclusionary Housing Ordinance.2.Project approvals must be conditioned with the option to propose an off-site method (i.e., CombinedProject) of satisfying the inclusionary obligation. A project proposing an off-site option may or maynot also propose an on-site option.3.Prior to final map or issuance of building permits, applicants must submit an Affordable HousingAgreement as described in the Inclusionary Housing Ordinance which specifically describes any off­site proposal.4.Off-site proposals in the form of a draft Affordable Housing Agreement will be reviewed by theCombined Project Review Committee and it will be determined if the necessary findings can be madeby staff.Page 3 of 4 Jan. 11, 2022 Item #4 Page 31 of 43 CITY OF CARLSBAD COUNCIL POLICY STATEMENT Policy No. -�5�7�----­Date Issued August 8, 1995 Effective Date August 8, 1995Cancellation Date _____ _ Supersedes No. ______ _ General Subject: AFFORDABLE HOUSING Specific Subject: Off-site and Combined Inclusionary Housing Projects Copies to: City Council, City Manager, City Attorney, Department and Division Heads, Employee Bulletin Boards, Press, File. 5.Staff's findings and recommendation, including the Combined/Off-site Project AssessmentWorksheet, will accompany the Affordable Housing Agreement to the Housing Commission foraction.6.Prior to final map or issuance of building permits, the proposed Affordable Housing Agreementwill be considered by City Council along with the recommendation of staff and HousingCommission.7.City Council will be the final decision making authority in determining whether an off-siteproposal is in the public interest and permitting this option.Page 4 of 4 Jan. 11, 2022 Item #4 Page 32 of 43 1. 2. 3. 4. 5. 6. OFF-SITE AND COMBINED INCLUSIONARY HOUSING PROJECT ASSESSMENT WORKSHEET BACK�ROUND Applicant Name and Address: Off-site or Combined Project Name: Description of Project with lnclusionary Housing Obligation: Proposed On-site Project Description (if any): Proposed Off-site Project Description: Description of On-site Project Constraints: Attachment "1" to Council Policy Statement No. 57 Jan. 11, 2022 Item #4 Page 33 of 43 1. -cc ASSESSMENT CRITERIA Feasibility of the On-site Proposal. a. Are there significant feasibility issues due to factors such as project size, site constraints, amount and availability of required subsidy, and competition from multiple projects thatmake an on-site option impractical? Brief Narrative: b.Will an affordable housing product be difficult to integrate into the proposed marketdevelopment because of significant price and product type disparity? Brief Narrative: C.Does the on-site development entity havethe capacity to deliver the proposedaffordable housing on-site? Brief Narrative: 2.Relative Advantages/Disadvantages of the Off-site Proposal. a.Does the off-site option offer greater feasibility and cost effectiveness than the on-sitealternative, particularly regarding potential local public assistance? WORKSHEET . . . ASSESSMENT·CONCLUSION . (Check appropriate box) . DOES NOT SUPPORT SUPPORTsOff.SfTE ·. Off..SITE PROPOSAL 2 wr;;oNCLUSIVE PROPOSAL Jan. 11, 2022 Item #4 Page 34 of 43 ''''. ASSESSMENT CRfTERIA Brief Narrative: b.Does the off-site proposal have location C. d. advantages over the on-site alternative, suchas proximity to jobs, schools, transportation,services; less impact on other existingdevelopments, etc.? Brief Narrative: Does the off-site option offer a development entity with the capacity to deliver the proposed project? Brief Narrative: Does the off-site option satisfy multiple developer obligations that would be difficult to satisfy with multiple projects? Brief Narrative: 3.Advancing Housing Goals and Strategv a.Does the off-site proposal advance and/orsupport City housing goals and policiesexpressed in the Housing Element, CHASand lnclusionary Housing Ordinance? Brief Narrative: SUMMARY WORKSHEET .. ASSESSMENT CONCLUSION (Check appropriate box) '· DOES NOT SUPPORT ..SUPPORTS Off'SITE <JFF..SITE PROPOSAL INCONCLUSIVE PROPOSAL DOES NOT SUPPORT SUPPO«TS.OFF-SFTE Off',SITE-PROPOSAL INCONCLUSIVE. PROPOSAL . . ·•·.··. 3 Jan. 11, 2022 Item #4 Page 35 of 43 Date Considered by Review Committee: Review Committee Action: Action: ar Jan. 11, 2022 Item #4 Page 36 of 43 CITY OF CARLSBAD COUNCIL POLICY STATEMENT General Subject: Specific Subject: AFFORDABLE HOUSING Sale of Affordable Housing Credits Page 1 of 4 Policy No. -�5=8 _____ _ Date Issued September 12, 1995 Effective Date Sept. 12. 1995Cancellation Date _____ _ Supersedes No. ______ _ Copies to: City Council, City Manager, City Attorney, Department and Division Heads, Employee Bulletin Boards, Press, File. PURPOSE To establish a policy to be followed by City Council and City staff in selling Affordable Housing Credits, controlled by the City, to developers who will use the Credits to satisfy obligations to provide affordable housing pursuant to the City's Inclusionary Housing Ordinance (CMC Chapter 21.85). BACKGROUND In the development of the 344-unit affordable housing project known as Villa Lorna in the Southwest Quadrant of the City, the developers and the City created a project which may be treated as a Combined Project as defined in the City's Inclusionary Housing Ordinance. With City Council approval, Combined Projects allow "some or all of the inclusionary units associated with one residential project site to be produced and operated at an alternative site". The "alternative site" becomes a Combined Project. Villa Loma 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 obligations thus making it a potential Combined Project. City financial participation in the project was also based on the concept of recovering costs through the sale of the excess units. Furthermore, Villa Lorna was structured to give the City control of these units (Affordable Housing Credits or "Credits") and their sale to potential Combined Project participants. Therefore, it is necessary to establish a policy to guide the City in the effective implementation of these Affordable Housing Credit sales transactions. POLICY Two basic factors will be considered in a Credit sale transaction --the financial aspect, which is the Credit pricing --this determines cost to a purchaser and revenue to the City; and the affordable housing aspect, which is the use of this mechanism to satisfy a developer's obligation under the Inclusionary Housing Ordinance. Based on these considerations, the following will guide Credit sales: EXHIBIT 5 Jan. 11, 2022 Item #4 Page 37 of 43 CITY OF CARLSBAD COUNCIL POLICY STATEMENT General Subject: Specific Subject: AFFORDABLE HOUSING Sale of Affordable Housing Credits Page 2 of 4 Policy No. -�5=8 _____ _ Date Issued __ S=e=p�t�-�1=2_, �1�9�9=5-Effective Date Sept. 12, 1995Cancellation Date _____ _ Supersedes No. ______ _ Copies to: City Council, City Manager, City Attorney, Department and Division Heads, Employee Bulletin Boards, Press, File. ► Price. The Credit price will be determined according to the following formula which divides the localfinancial contribution provided to the Villa Loma project by the total number of Credits available.The local financial contribution consists of all City financial assistance provided to the project ( eitheras loans or expenditures for land including accrued interest on such amounts for the period of timethey are outstanding); and the local developer contribution to the project provided in order to satisfyan affordable housing obligation):Affordable Housing Credit Pricing Formula + Number of AffordableLocal Financial Contribution Housing Credits AvailableCity Contribution $4.2 Million* Developer Contribution (Aviara Land Associates) .9 TOT AL $5.1 Million *To be adjusted with the addition of interest.184 = Unit Price of Affordable Housing Credits (Rounded to nearest $1,000)* $28,000* ► Terms of Purchase and Sale. The commitment to purchase and sell Credits will be accomplishedthrough an Affordable Housing Agreement as required by the Inclusionary Housing Ordinance. ThisAgreement will contain the terms of the Credit sale and will acknowledge the satisfaction of anaffordable housing obligation through participation in a Combined Project (Villa Loma).Jan. 11, 2022 Item #4 Page 38 of 43 t CITY OF CARLSBAD COUNCIL POLICY STATEMENT Page 3 of 4 Policy No. ------"'5-"-8 _____ _ Date Issued Sept. 12. 1995Effective Date Sept. 12. 1995Cancellation Date _____ _ Supersedes No. ______ _ General Subject: AFFORDABLE HOUSING Specific Subject: Sale of Affordable Housing Credits Copies to: City Council, City Manager, City Attorney, Department and Division Heads, Employee Bulletin Boards, Press, File. ► Selection of Purchasers. The following procedure will apply to the selection of purchasers andallocation of Credits: 1.Project Review. Staff, through the Combined Project Review Committee (see Council PolicyNo. 57) will review all applications and approved projects with inclusionary requirements anddetermine which projects will be recommended to satisfy their obligations through thepurchase of Credits. If the number of acceptable projects have affordable housingrequirements which exceed the available number of Credits, projects will be ranked andallocated Credits accordingly. Projects will be reviewed and ranked using the followingcriteria:a)The immediacy of the need to satisfy an affordable housing obligation with respect tothe market rate project that is generating the obligation.b)The readiness and capacity of the developer to enter into an Affordable HousingAgreement and perform under its terms.c)The acceptability of the Combined Project as an off-site option in lieu of thesatisfaction of the affordable housing obligation on-site with respect to the project thatis generating the obligation (see Council Policy No. 57).2.Electing to Purchase Credits. Developers will be notified of staffs recommendation to permitthe purchase of Credits and given the opportunity to accept or reject this option.3.Reservation of Credits. Developers wishing to use the option of purchasing Credits must havetheir projects approved with conditions allowing this option. In addition to PlanningCommission approval, the recommendation of the Housing Commission will be required forthe Credit purchase option of satisfying the Inclusionary Housing Obligation. When a projectis approved (e.g., tentative map) with the Credit purchase condition, a reservation of theCredits is made for the project.Jan. 11, 2022 Item #4 Page 39 of 43 CITY OF CARLSBAD COUNCIL POLICY STATEMENT General Subject: Specific Subject: AFFORDABLE HOUSING Sale of Affordable Housing Credits Page 4 of 4 Policy No. -�5"'8'--------­Date Issued Sept. 12, 1995 Effective Date Sept. 12, 1995 Cancellation Date ------Supersedes No. ______ _ Copies to: City Council, City Manager, City Attorney, Department and Division Heads, Employee Bulletin Boards, Press, File. 4.Affordable Housing Agreement. Within sixty (60) days of the approval of the Credit purchasecondition, the developer must deliver to the Housing and Redevelopment Director a signedAffordable Housing Agreement in the form prescribed by the City with a non-refundabledeposit in an amount equal to 10% of the total Credit sale price. The Affordable HousingAgreement will be scheduled for City Council consideration and, if and when approved, willbe executed by the City. The Affordable Housing Agreement will require payment of thebalance of the purchase price upon execution and prior to final map or issuance of a buildingpermit. 5.Failure of Developer to Perform or Denial of Purchase Option. If the developer is unable toperform as required, or is denied the option of purchasing Credits, the Credits will be madeavailable to another project(s), subject to this process. 6.This policy is subject to all other requirements of the Inclusionary Housing Ordinance. Jan. 11, 2022 Item #4 Page 40 of 43 City Council Policy Statement No. 57 criteria and analysis La Costa Villas North project affordable housing credits request Policy 57 criteria Analysis Feasibility issues on site The following issues impact the on-site feasibility: Size - the project consists of 9 condominiums, making it difficult to absorb the costs of two affordable rate units. Design and product type - The site is only 0.40 acres in size, which limits unit size and type after parking and setbacks. Difficult to integrate Design and product type - With only 9 units, absorbing two low-income units on site is not financially feasible. The lot configuration and building design is not conducive to an alternative design for the affordable units. Feasibility/cost effectiveness The small size of the project make on-site affordable units infeasible. The funds received by the city for the purchase of two affordable housing credits will allow the city to invest in more meaningful affordable housing opportunities. Location advantages The location is not in close proximity to services that support low income households. The funds received by the city for the purchase of two affordable housing credits will allow the city to invest in more appropriately located affordable housing opportunities. Capacity to deliver On site units would not have services provided. The funds received by the city from the purchase of two affordable housing credits will allow the city to invest in affordable housing opportunities that provide on- site services for residents. Advance housing goals The funds received by the city from the purchase of two affordable housing credits will allow the city to recoup the costs paid by the city for the existing Cassia Heights units and allow the city to re-invest dollars into additional affordable housing opportunities. Jan. 11, 2022 Item #4 Page 41 of 43 RESOLUTION NO. 2021-009. A RESOLUTION OF THE HOUSING COMMISSION OF THE CITY OF CARLSBAD, CALIFORNIA RECOMMENDING THAT THE CITY COUNCIL APPROVE A REQUEST BY LA COSTA VILLAS NORTH TO PURCHASE TWO AFFORDABLE HOUSING CREDITS IN THE CASSIA HEIGHTS APARTMENTS COMBINED HOUSING PROJECT IN ORDER TO SATISFY THE AFFORDABLE HOUSING OBLIGATION OF ITS HOUSING DEVELOPMENT UNDER THE CITY'S INCLUSIONARY HOUSING ORDINANCE WHEREAS, 400 Gibralter, LLC is under contract to build a nine-home condominium project, known as La Costa Villas North, and is conditioned to provide two units affordable units affordable to low income households; and WHEREAS, the Planning Commission approved said development on Oct. 20, 2021; and WHEREAS, the home builder is seeking to satisfy the inclusionary housing requirement through the purchase of two affordable housing credits as opposed to building on site: and WHEREAS, credits in the southwest or southeast quadrants are available to purchase for this project; and WHEREAS, the city’s Affordable Housing Policy Team reviewed the request on February 22, 2021 to discuss the request and consider options, prior to presenting it to the Housing Commission for their consideration and recommendation to the City Council; and WHEREAS, the Housing Commission makes recommendations to the City Council for projects that alternatively meet affordable requirements set forth in 21.85 of the Carlsbad Municipal Code; and WHEREAS, the Housing Commission considered the request, staff evaluation and recommendation, and the testimony of all persons desiring to be heard on the matter at a special meeting on Nov. 18, 2021. NOW, THEREFORE, BE IT RESOLVED by the Housing Commission of the City of Carlsbad, California, as follows: 1.That the above recitations are true and correct. 2.That the request from 400 Gibralter, LLC to alternatively satisfy the inclusionary housing requirement is consistent with the goals, objectives and programs of the City of Carlsbad's Housing Element, and City Council Policies 57 and 58 as currently adopted. 3.That, based on information provided in the Housing Commission staff report and considering testimony of all persons desiring to be heard at the Nov. 18, 2021 public Jan. 11, 2022 Item #4 Page 42 of 43 meeting, the Housing Commission hereby recommends that the City Council approve the request to purchase two affordable housing credits to satisfy the inclusionary housing requirement for la Costa Villas North. PASSED, APPROVED AND ADOPTED at a Meeting of the Housing Commission of the City of Carlsbad on the 18th day of November 2021, by the following vote, to wit: AYES: EVANS, MANZANO, CORTES - TORRES, NGUYEN - CLEARY NAYS: NONE ABSENT: COLE JOHN NGUYEN-CLEARY, CHAIRPERSON CARLSBAD HOUSING COMMISSION ATTEST: MANDY MILLS Director of Housing & Homeless Services Jan. 11, 2022 Item #4 Page 43 of 43