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HomeMy WebLinkAbout1995-01-17; Housing & Redevelopment Commission; 265; Village Housing Replacement Planbo HOUSING AND R-)EVELOPMENT COMMISSI(- - AGENDA BILL 1 AB# 265 v TITLE: VILLAGE HOUSING REPLACEMENT DEPT. HD.b MT& ;I-/ ?- .%- PLAN CITY ATTY DEPT. RED. E CITY MGR. RECOMMENDED ACTION: That the Housing and Redevelopment Commission adopt Resolution No. 7& 2 APPROVING the Village Housing Replacement Plan for the Redevelopment Project Area as required by AB1290. ITEM EXPLANATION: The California Community Redevelopment Law, Health and Safety Code Sections 33000 et seq. states that one of the fundamental purposes of redevelopment is to increase and improve the commumty’s supply of low and moderate income housing. This is accomplished in part through three different but interrelated requirements imposed on the Agency by California Law. These three requirements provide for the production, improvement and preservation of housing for low and moderate income persons. These requirements are: 0 Twenty (20) percent of tax increment revenue must be expended to increase, improve and preserve the supply of low and moderate income housing within the community (Health and Safety Code Section 33334.2); 0 The Agency must replace low and moderate income housing which is removed as a result of a redevelopment project which is known as “the replacement rule” (Health and Safety Code Section 33413[a]); and, 0 A fixed percentage of all housing constructed in a Redevelopment Project Area must be affordable to low and moderate income persons and families which is known as “the inclusionary rule” (Health and Safety Code Section 33413[b]). Health and Safety Code Section 33413(b)(4) requires that each redevelopment agency adopt a plan to comply with the requirements of the inclusionary rule. This compliance plan is outlined within the Village Redevelopment Implementation Plan required by AB1290 and to be approved under separate action of the Housing and Redevelopment Agency. Health and Safety Code Sections- 33413.5 and 33334.5 require replacement housing plans for compliance with the replacement rule noted above. The Housing Replacement Plan provided as Exhibit 2 to this agenda bill outlines how the Carlsbad Redevelopment Agency intends to comply with the replacement rule for projects within the Village Redevelopment Project Area which were implemented prior to July 1, 1994. AB# 2&i Page 2 PLAN REQUIREMENTS Per Health and Safety Code Section 33413.5, the Carlsbad Redevelopment Agency is required to adopt a resolution; following a public hearing, approving a replacement housing plan which indicates how the agency will comply with the requirements of the replacement rule. The Replacement Plan must include: 0 Location of replacement housing; 0 Means of financing replacement housing; 0 Compliance with Article 34; l Number of affordable units planned for construction; and, a Timetable for meeting replacement housing objectives. HOUSING REPLACEMENT REQUIREMENTS FOR THE VILLAGE Due to direct Agency involvement in construction of a public parking lot on the corner of Roosevelt Street and Carlsbad Village Drive, two (2) single family homes were demolished. There is no documentation on file which indicates the units were affordable to very low, low or moderate income households prior to demolition (June, 1990). Also, these housing units were in a very deteriorated condition and were not occupied prior to City purchase of property for the construction of the public parking lot. However, since the Redevelopment Agency has no documentation to indicate that the units could not be rehabilitated and returned to the low and moderate income housing stock. The Agency has decided that it should accept the responsiblity to replace these two (2) units under the redevelopment law “replacement rule”. The two (2) demolished units will be replaced within the La Terraza Affordable Housing Project to be located at 9156 El Camino Real. Although this project is located outside the Village Redevelopment Area, the project will provide 344 apartment units with restricted rents affordable to low and very low income families. The Housing and Redevelopment Commission has previously made the appropriate findings to indicate that the subject affordable housing project benefits the Village Redevelopment Area. The Redevelopment Agency and City of Carlsbad have contributed over $4 million to ensure construction of this project. The project will be complete by early 1996. The. Agency/City does not intend to participate in any other projects over the next five (5) years which will result in the removal of housing units from the supply currently available within the Village Redevelopment Area. However, if the Agency/City does decide to become directly. involved with a housing project within the redevelopment project area which does, in fact, result in the removal of housing units affordable to low and/or moderate income households, the Agency will amend this plan and meet the replacement requirement as outlined. 2 - AB# 26 Page 3 ENVIRONMENTAL REVIEW The adoption of an implementation plan is not a “project” requiring review under the California Environmental Quality Act (“CEQA”). Subsequent action on specific projects will be subject to CEQA if not already covered by a recent EIR for the redevelopment plan or a program EIR adopted in connection with a particular project or program. FISCAL IMPACT No fiscal impact created by adoption of this plan. The funding for the La Terraza Apartment Project has been approved by previous action of the City Council and the Housing and Redevelopment Commission. EXHIBITS: l- Housing and Redevelopment Commission Resolution No. 2 6 2 2- Village Housing Replacement Plan. 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOUSING & REDEVELOPMENT COMMISSION RESOLUTION NO. 262 A RESOLUTION OF THE HOUSING AND REDEVELOPMENT COMMISSION OF THE CITY OF CARLSBAD, CALIFORNIA ADOPTING THE HOUSING REPLACEMENT PLAN FOR PREVIOUS PROJECTS WITHIN THE VILLAGE REDEVELOPMENT PROJECT AREA. WHEREAS, the Redevelopment Agency of the City of Carlsbad, hereinafter referred to as “Agency”, is a Community Redevelopment Agency organized and existing under the Community Redevelopment Law, Health and Safetv Code Section 33000, et.seq., hereinafter referred to as the “Act”; and WHEREAS, the Agency is authorized to implement the Redevelopment Plan for the Carlsbad Village Redevelopment Project Area; and WHEREAS, Sections 33413.5 and 33334.5 of the Act require that the Carlsbad Redevelopment Agency adopt a Housing Replacement Plan for redevelopment activities which result in the loss of low and moderate income housing; and WHEREAS, the Housing Replacement Plan shall be adopted following a public hearing conducted pursuant to section 6063 of the Government Code and after proper notice. NOW, THEREFORE, BE IT HEREBY RESOLVED by the Housing and Redevelopment Commission of the City of Carlsbad, California, as follows: 1. The above recitations are true and correct. 2. That pursuant to California Health and Safety Code Sections 33413.5 and 33334.5 the Carlsbad Revelopment Agency hereby adopts the “Village Redevelopment Project Area Housing Replacement Plan”, for redevelopment activities implement prior to July 1, 1994. 3. That the Housing and Redevelopment Commission authorizes the Executive Director of the Carlsbad Redevelopment Agency and designated staff to administer the adopted Housing Replacement Plan. . . . . . . . . . . . . . . . . 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 27 22' 23 24 25 26 27 28 HRC Resolution No. 262 Page 2 4. That no review of the subject implementation plan is required under the California Environmental Quality Act (CEQA) because the plan is not an approval of a specific project under CEQA. All future specific projects will be subject to CEQA review. PASSED, APPROVED, AND ADOPTED at a regular meeting of the Housing and Redevelopment Commission of the City of Carlsbad, California, held on the 17th day of January, 1995, by the following vote, to wit: AYES: Commissioners Lewis, Nygaard, Kulchin, Finnila, Hall NOES: None ABSENT: None ABSTAIN: None r- c c - EXHIBIT 2 VILLAGE REDEVELOPMENT PROJECT AREA HOUSING REPLACEMENT PLAN December 12, 1994 Prepared by Housing and Redevelopment Department City of Carlsbad VILLAGE REDEVELOPMENT PROJECT AREA Housiw Redacement Plan The California Comrntmity Redevelopment Law, Health and Safety Code Sections 33000 et seq. states that one of the fundamental purposes of redevelopment is to increase and improve the community’s supply of low and moderate income housing. This is accomplished in part through three different but interrelated requirements imposed on the Agency by California Law. These three requirements provide for the production, improvement and preservation of housing for low and moderate income persons. These requirements are: 0 Twenty (20) percent of tax increment revenue must be expended to increase, improve and preserve the supply of low and moderate income housing within the community (Health and Safety Code Section 33334.2); 0 The Agency must replace low and moderate income housing which is removed as a result of a redevelopment project which is known as “the replacement rule” (Health and Safety Code Section 33413[a]); and, 0 A fixed percentage of all housing constructed in a Redevelopment Project Area must be affordable to low and moderate income persons and families which is known as “the inclusionary rule” (Health and Safety Code Section 33413[b]). Health and Safety Code Section 33413(b)(4) requires that each redevelopment agency adopt a plan to comply with the requirements of the inclusionary rule. This compliance plan is outlined within the Village Redevelopment Implementation Plan required by AB1290. Health and Safety Code Sections 33413.5 and 33334.5 require replacement housing plans for compliance with the replacement rule noted above. This separate Plan outlines how the Carlsbad Redevelopment Agency intends to comply with the replacement rule for projects within the Village Redevelopment Project Area which were implemented prior to July 1, 1994. THE REPLACEMENT RULE Health and Safety Code Section 33413(a) requires that whenever dwelling units which house persons and families of low or moderate income are destroyed or removed from the low and moderate income housing market as part of a redevelopment project subject to a written agreement with the agency, the Redevelopment Agency is required to ensure that an equal number of replacement dwelling units are developed within four (4) years of the removal of the dwelling units. VILLAGE HOUSING REPLACEMENT PLAN For affordable units removed prior to September 1, 1989, replacement units must be available at an affordable housing cost to persons and families of low and moderate income, without regard to the specific income of the person or family originally occupying the removed dwelling unit. However, for units removed after September 1, 1989, California Law requires that seventy-five (75) percent of the replacement units be affordable to the same income groups that occupied the units that were removed. Health and Safety Code Section 33413(c) requires that replacement, as well as inclusionary, units remain available at an affordable housing cost to the income levels indicated for the longest feasible time, which includes but is not limited to an unlimited duration. When housing units are developed or assisted with money from the Agency’s twenty percent (20%) affordable housing set-aside fund, the Redevelopment Agency is required by State Law to ensure that those housing units remain affordable for the longest feasible time, but for not less than fifteen (15) years for rental units or ten (10) years for owner-occupied units. It is the policy of the Carlsbad Redevelopment Agency and the City of Carlsbad that Very Low Income, Lower Income and Moderate Income units developed anywhere within the City pursuant to the inclusionary or replacement housing rule shall remain affordable for the longest feasible time but not less than thirty (30) years. Per Health and Safety Code Section 33413.5, the Carlsbad Redevelopment Agency is required to adopt a resolution approving a replacement housing plan which indicates how the agency will comply with the requirements of the replacement rule. The Replacement Plan must include: 0 Location of replacement housing; 0 Means of financing replacement housing; 0 Compliance with Article 34; 0 Number of affordable units planned for construction; and, 0 Timetable for meeting replacement housing objectives. VILLAGE REDEVELOPMENT AREA HOUSING REPLACEMENT PLAN Since adoption of the Village Redevelopment Plan in 1981, there have been only two (2) housing units demolished as a result of direct action taken by the Carlsbad Redevelopment Agency. The Agency will replace these units as required. VILLAGE HOUSING REPLACEMENT PLAN GENERAL LOCATION OF REPLACEMENT HOUSING Replacement housing units related to implementation of the Village Redevelopment Project Area Plan may be located city-wide unless those units are also be counted for purposes of compliance with the inclusionary housing requirements. If replacement units are be counted for compliance with the inclusionary housing requirements, the units will be newly constructed or rehabilitated and located within the Village Redevelopment Project Area. Otherwise, the replacment units may be located in affordable housing projects outside the Village Redevelopment Project Area at a 2: 1 ratio (two replacement units for each 1 unit removed from the project area). Replacement units will be developed within in-fill housing projects within the Village Redevelopment Project Area and/or as part of other affordable housing projects (or market rate projects) both inside and outside the project area. MEANS OF FINANCING REPLACEMENT UNITS The Carlsbad Redevelopment Agency will use its twenty percent (20%) affordable housing set-aside funds in working with private for-profit and non-profit housing developers to produce and/or preserve affordable housing units both inside and outside the Village Redevelopment Project Area. The Agency also intends to use all other state, federal and local sources of funding to assist in the effort to provide the replacement housing units. Funding sources include, but are not limited to: 1) Federal Community Development Block Grant funds; 2) Inclusionary Housing Impact Fees and In-Lieu Fees, if established by the City; 3) Mortgage Revenue Bonds and Mortgage Credit Certificates; 4) federal or state HOME funds; 5) federal or state Tax Credit financing; and/or 6) other state and/or federal programs for financing housing projects which may become available to the Agency and/or City of Carlsbad. To be successful in producing affordable housing units, the Carlsbad Redevelopment Agency as well as the City of Carlsbad cannot rely on a single source of funding. Affordable housing must be produced through the utilization of a number of different funding sources. The Agency will leverage its set-aside funds with other sources of funding for the production of affordable housing replacement units, as appropriate. The form of the Agency’s assistance may include, but is not limited to, the following: 0 land acquisition; 0 site demolition, grading and preparation; 0 relocation; 0 on-site and off-site improvements; VILLAGE HOUSING REPLACEMENT PLAN 0 deferred development fees; 0 mortgage buy-down and down payment assistance programs; 0 direct subsidies; 0 implementation or coordination of local, state or federal low income and first time homebuyer programs; 0 loans, advances or other indebtedness; and, 0 bond programs and other leveraging opportunities. COMPLIANCE WITH ARTICLE 34 Article 34 of the State Constitution was originally approved by the voters for the specific purpose of providing a mechanism for community residents to express concern regarding the development, acquisition, or construction of federally subsidized conventional public housing projects. The projects typically looked different from market rate housing projects and were occupied entirely by persons of low income. These type of projects were generally not seen as desirable. However, since approval of Article 34, new forms of housing assistance have provided housing for persons of low income in a manner which is consistent with and supportive of optimum community improvement. Such forms of assistance have allowed for mixed income occupancy in developments representative of and competitive with similar market rate developments provided entirely by the private sector. Recognizing that these new forms of housing assistance provide new approaches and opportunities for providing desirable housing for persons of low income, the State Legislature has found and declared Health and Safey Code Sections 37001, 37001.3 and 37001.5 are necessary to clarify ambiguities relating to the scope of the applicability of Article 34. To date, the Carlsbad Redevelopment Agency and City of Carlsbad have not developed, nor intend to develop, any low income affordable housing which is subject to Article 34. All housing units developed within the City of Carlsbad, as well as those contemplated for the immediate future, are anticipated to be exempt from the requirement of Article 34. Housing units which are specifically exempted from the requirements of Article 34 are located in projects where: 1) The development is privately owned housing, receiving no ad valorem property tax exemption, other than exemptions granted pursuant to subdivision (f) or (g) of Section 214 of the Revenue and Tax Code, not fully reimbursed to all taxing entities; and not more than 49 percent of the dwellings, apartments or other living accommodations of the development may be occupied by persons of low income. 2) The development is privately owned housing, is not exempt from ad valorem taxation by reason of any public ownership, and is not financed with direct long-term financing from a public body. VILLAGE REPLACEMENT HOUSING PLAN 3) 4) 5) 6) 7) The development is intended for owner-occupancy, which may include a limited equity housing cooperative as defined in Section 50076.5 of the Health and Safety Code, or cooperative or condominium ownership, rather than for rental-occupancy. The development consists of newly constructed, privately owned, one to four family dwellings not located on adjoining sites. The development consists of existing dwelling units leased by the state public body from the private owner of these dwelling units. The development consists of the rehabilitation, reconstruction, improvement or addition to, or replacement of, dwelling units of a previously existing low rent housing project, or a project previously or currently occupied by lower income households, as defined in Section 50079.5 of the Health and Safety Code. The development consists of the acquisition, rehabilitation, reconstruction, improvement, or any combination thereof, of a rental housing development which, prior to the date of the transaction to acquire, rehabilitate, reconstruct, improve, or any combination thereof, was subject to a contract for federal or state public body assistance for the purpose of providing affordable housing for low income households and maintains, or enters into, a contract for federal or state public body assistance for the purpose of providing affordable housing for low income households. The key to application of the requirements of Article 34 is whether or not a state public body (i.e, the Carlsbad Redevelopment Agency or City of Carlsbad) “develops, constructs or acquires” a housing project where more than 49% of the units will be occupied by low income households. Based on judicial and legislative interpretations of the meaning of “develop, construct or acquire”, Article 34 shall not apply to an activity where the Agency or City: 1) Provides financing, secured by a deed of trust or other security instrument to a private owner of existing housing; or acquires a development, for which financing previously has been provided, as a temporary measure to protect security and with an intention to change the ownership so that it will not continue to be the owner of a low rent housing project; 2) Acquires or makes improvements to land which is anticipated to be sold, ground leased, or otherwise transferred to a private owner prior to its development as a low rent housing project, provided the land and improvements thereon are not subject to an exemption from property taxation by reason of public ownership for more than five years following acquisition or improvement by the state public body,. or such an exemption from property taxation persists beyond the five year period and no alternative use is designated for the land or improvements, but any property tax revenues lost by affected taxing agencies on VILLAGE REPLACEMENT HOUSING PLAN 3) 4) 5) 6) 7) account of the exemption of land or improvements from property taxes by reason of public ownership of the property, or any interest in the property after the five year period, are fully reimbursed by payments in lieu of taxes following the expiration of the five year period; Leases existing dwelling units from the private owner of such units, provided the lease or a subtenancy thereunder does not result in a decrease of property tax revenues with respect to the dwelling units leased; Provides assistance to the private owner or occupant of existing housing which enables an occupant to live in decent, safe, and sanitary housing at a rent he or she can afford to pay; Provides assistance to a low rent housing project and monitors construction or rehabilitation of such project and compliance with conditions of such assistance to the extent of: carrying out routine governmental functions, performing conventional activities of a lender; imposing constitutionally mandated or statutorily authorized conditions accepted by a grantee of assistance; Provides assistance to a development prior to its becoming a low rent housing project without intending or expecting that the development will become a low rent housing project; and/or, Provides financing for a low rent housing project pursuant to Chapter 6.7 (commencing with Section 5 1325 of the Health and Safety Code) of Part 3 of Division 31. All of the affordable housing units assisted by the Redevelopment Agency, developed pursuant to an agreement with the Agency, or contemplated to be assisted by the Agency to date are, or will be, exempt from the requirements of Article 34 based on the information provided above. The Agency and/or the City of Carlsbad do not intend to produce or assist in the production of any affordable housing units over the next five years which would trigger the requirements of Article 34. However, if the Agency and/or the City of Carlsbad do participate in the development of affordable housing for low income households in a manner which does, in fact, trigger the requirements of Article 34, the Agency and/or City of Carlsbad will fully comply with the regulations and place the project on the election ballot for a vote by the registered voters of Carlsbad. VILLAGE REPLACEMENT HOUSING PLAN NUMBER OF UNITS AND INCOME LEVELS TO BE REPLACED The Carlsbad Redevelopment Agency has a legal requirement according to the “replacement rule”, pursuant to Section 33413(a) of the Health and Safety Code, to replace a total of two (2) units of housing affordable to low and/or moderate income households for the period 1981 through 1994. Due to direct Agency involvement in construction of a public parking lot on the corner of Roosevelt Street and Carlsbad Village Drive, two (2) single family homes were demolished. These units will be replaced within the La Terraza Affordable’ Housing Project located on El Camino Real and outside the Village Redevelopment Area. The Agency/City does not intend to participate in any other projects over the next five (5) years which will result in the removal of housing units from the supply currently available within the Village Redevelopment Area. However, if the Agency/City does decide to become directly involved with a housing project within the redevelopment project area which does, in fact, result in the removal of housing units affordable to low and/or moderate income households, the Agency will amend this plan and meet the replacement requirement as outlined. TIMETABLE FOR MEETING REPLACEMENT OBJECTIVES The Agency will make every effort to meet its obligation to provide replacement affordable housing within four (4) years of the date housing units are removed from the Village Redevelopment Project Area. To date, the Agency has participated in only one (1) redevelopment project, construction of a public parking lot, which has resulted in the demolition of housing units. The total number of housing units demolished were two (2) single family homes. There is no documentation on file which indicates the units were affordable to very low, low or moderate income households prior to demolition (June, 1990). These housing units were in a very deteriorated condition and were not occupied prior to City purchase of property for the construction of the public parking lot. However, since the Redevelopment Agency has no documentation to indicate that the units could not be rehabilitated and returned to the low and moderate income housing stock. The Agency decided to accept the responsiblity to replace these two (2) units. The units will be replaced within the La Terraza Affordable Housing Project to be located at 9156 El Camino Real. Although this project is located outside the Village Redevelopment Area, the project will provide 344 apartment units with restricted rents affordable to low and very low income families. The Housing and Redevelopment Commission has made the appropriate findings to indicate that the subject affordable housing project benefits the Village Redevelopment Area. The Agency and City of Carlsbad have contributed over $4 million to ensure construction of this project. The project will be complete by early 1996.