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HomeMy WebLinkAbout1996-11-14; Housing Commission; MinutesMinutes of: HOUSING COMMISSION Time of Meeting: 6:OO P.M. Date of Meeting: November 14,1996 Place of Meeting: CITY COUNCIL CHAMBERS CALL TO ORDER: Chairperson Calverley called the Regular Meeting to order at 6:OO p.m. PLEDGE OF ALLEGIANCE: The pledge of allegiance was led by Commissioner Noble. ROLL CALL: Present: Chairperson Calverley, Commissioners Escobedo, Noble, Rose, Sato, Scarpelli, Schlehuber, Walker, and Wellman Absent: None Staff Present: Evan Becker, Housing and Redevelopment Director Debbie Fountain, Senior Management Analyst Leilani Hines, Management Analyst Toni Espinoza, Acting Program Manager APPROVAL OF MINUTES: ACTION: Motion by Commissioner Rose, and duly seconded, to approve the Minutes of the Regular Meeting of September 12,1996, changing the VOTES and ABSTAIN portions of the Minutes to indicate that Commissioner Wellman was absent and was therefore unable to abstain. Calverley, Escobedo, Noble, Rose, Sato, Scarpelli, Schlehuber, Walker VOTE: 8-0-1 AYES: NOES: None ABSTAIN: Wellman COMMENTS FROM THE AUDIENCE ON ITEMS NOT LISTED ON THE AGENDA: There were no comments from the audience. NEW BUSINESS: 1. RENTAL REHABILITATION PROJECT - 965 LAGUNA DRIVE - Request for recommendation of financial assistance in an amount not to exceed $21 6,750 from the City of Carlsbad Redevelopment Low and Moderate Income Housing Set-Aside funds for the rehabilitation of rental property located at 965 Laguna Drive. Leilani Hines reviewed the background of the request and reported that in previous years there has been significant deferred maintenance and repairs to this property, with very minimal on-site and/or non-existent management. In addition, the site has been a continued source of complaints from both the Police Department and the Code Enforcement Division. Ms. Hines said that the proposed or preliminary scope of work by the applicant includes both interior and exterior repairs. Ms. Hines stated that while this program is recommended to be implemented by the County of San Diego, the County has not visited the property to evaluate what needs to be done. Ms. Hines *- e- HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 2 stated that the estimated interior repairs include new carpeting, appliances, window coverings, repair or replacement of plumbing, electrical, windows, and doors. Estimated exteriors repairs include roof replacement, painting, fencing, irrigation, landscaping, and driveway and parking lot repairs. Ms. Hines stated that the applicant is requesting approximately $12,750 in financial assistance per unit, for a total of about $216,000. Staff is recommending the use of the Redevelopment Low and Moderate Income Set-Aside funds because of the positive impact on the City’s revitalization efforts with its close proximity to the redevelopment area. In exchange for the City’s financial assistance, Staff is asking that there be affordability restrictions on the project in place for a minimum of 20 years. Ms. Hines stated that Staff is recommending that financial assistance be provided from the Redevelopment Low and Moderate Income Housing Set-Aside funds with the understanding that the County of San Diego administer and implement the project. The project would be subject to all of the County’s rehabilitation standards with the exception of the City’s affordability restrictions. Ms. Hines stated that in analyzing the request for financial assistance, Staff looked at both the project quality and the financial feasibility of the project, as well as the applicant’s ability to provide the project. In terms of the quality, by rehabilitating this property, the City is encouraging a safe and sanitary living environment for residents of the projects. Staff is requesting that there be on-site property management consistent with State law. Staff believes the rehab of this property will increase its property value and positively impact the surrounding neighborhood. In terms of financial assistance and the present value of the assistance that is proposed, Ms. Hines stated that Staff is recommending $217,000 and the present value would be around $220,000. Ms. Hines stated that the applicantldeveloper is very experienced in acquisition and rehabilitation of projects. He currently has completed two privately financed acquisition projects totaling about 36 units, and he has worked with the County in three other instances to rehab a total of 52 units. In terms of the City’s housing needs and goals, Ms. Hines stated that rehabilitation helps to preserve the integrity of units and provides a stable, safe, and sanitary living environment. In addition, it prevents the elimination of the City’s rental stock and prevents the elimination of rental stock that serves larger families. Ms. Hines pointed out that these goals are consistent with the Housing Element Goals and Objectives, and in the HUD Consolidated Plan it meets a medium priority. Chairperson Calverley opened the item for discussion among the Commission members. Commissioner Wellman asked how the 20 years of affordability issue was determined and if it was possible to consider a longer length of time. Ms. Hines replied that it is possible to consider a longer length of time and that the applicant originally requested 15 years. She said that in Staff‘s financial analysis--looking at the discount rate, the income lost on the property, and the requested financial assistance--that 20 years evened it out where the City was getting more for the financial assistance given that the present value was much greater. Staff therefore decided upon the 20-year determination; something that was in between the 15 years but not as restrictive as the 30 years. Commissioner Wellman inquired if the City will be asked to provide more funding if the County determines that the rehab cost will be greater than $21 6,000. Ms. Hines replied that the maximum assistance of $21 6,000 is based on the County’s maximum limitations in terms of the assistance that they can give per unit, and the scope of work would be limited to the $21 6,000 of financial assistance. HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 3 Commissioner Wellman asked how much the developer would put into the project. Mr. Becker replied that this project is different from an inclusionary housing project. Staff looks for two returns, one being getting the actual physical rehabilitation done. The key is to have a program like the County’s that ensures that a dollar‘s worth of the City’s investment results in a dollar‘s worth of good rehab and that the progression of what is done begins with the most important things first, i.e., code issues, incipient code problems, and then possibly cosmetics. In addition to looking for the physical rehab, Staff looks at the affordability value of the rent discounts or the present value over time. This is what Staff focuses on rather than what the other aspects of the transaction are, which are left to the marketplace. Mr. Becker pointed out that in terms of the affordability restrictions, the County has had success with their program with a 10-year affordability restriction. Mr. Becker further stated that while the developer asked for 15 years, Staff is recommending 20 years; and that when Staff calculated what the rent discounts were over 20 years, it came out to exceed the level of investment that was estimated to be needed for the rehab. Commissioner Wellman asked if the present value of the property is approximately what the financial assistance will be. Mr. Becker stated that it was the present value of the rental restrictions over time. Commissioner Wellman asked for a valuation of the property. Mr. Becker replied that Staff knows what the purchase price in escrow is; but as far as the City’s part of the transaction, the assistance the City will provide will become a second trust deed against the property, and there will be a limitation through the County standards of no greater than 80 percent loan-to-value. Mr. Becker added that there is a standard cushion built in in terms of the City’s piece of assistance in relation to the value of the property. Commissioner Wellman replied that if the appraisal is low, then the County would not be able to lend the full $21 6,000. Mr. Becker replied that the City would have to consider lending less. Mr. Becker said that the level of improvements would increase the value of the property, which is a standard that exists in the County’s program. Commissioner Wellman asked if there was an administrative or profit fee factored in for the developer or the County or the City. Ms. Hines replied that the $217,000 is merely for the rehab of the project and does not take into account the administrative costs except for the administrative costs on the County’s part working directly with the rehab of the project. Commissioner Wellman asked if there is a percentage factored into the costs for getting estimates and bids, and if not where the funds come from to pay these fees. Ms. Becker replied that the agreement the City has with the County in terms of their administrative costs is an actual cost incurred reimbursement. This agreement works for both the single-family and rental rehab; so what the County does is registered as a cost which will be billed for and paid for separately. Mr. Becker added that the City has not done a rental rehab project yet, but single-family is funded with Block Grant money. In this case, Mr. Becker expects the money will come from Set-Aside as well. HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 4 Commissioner Scarpelli asked who would be supervising the site management. Ms. Hines replied that the County of San Diego will be monitoring the project. Mr. Becker stated that the applicant will address this issue and that the City will require a property management plan. Commissioner Walker asked what will happen to the second if the property is sold within the 20-year period. Ms. Hines replied that the second goes with the next owner so that all of the affordable housing stays with it for 20 years. Commissioner Walker asked who determines what repairs have to be done and expressed concern about the heating system. Ms. Hines replied that the County will do a “work write-up” to determine what is a Priority A, what is a Priority B according to their rehab standards. Once the County has the work write-up, the applicant fixes everything in accordance to the rehab standards. She said that things could change from the scope of what is being presented, but the amount of funding would not change. Chairperson Calverley invited the applicant to speak. Michael Boardman, 2051 Vista Hermosa Way, El Cajon, CA, addressed the Commission and said that he is planning to purchase the property subject to approval to obtain the funds to rehab the project. He said that this will be his fourth project using government assistance to rehab a rental project but the first project with the City of Carlsbad. The other projects have been with the County of San Diego. Mr. Boardman stated that he has requested $12,750 per unit for the 17 units. Mr. Boardman said there are substantial repairs that need to be done to this project. Based on preliminary walks though the units, Mr. Boardman stated that the interest of the previous owner has dwindled over the years and the owner has not spent time on the property nor has he kept up on the deferred maintenance. As a result, there has been a gradual decline of the property. In addition, virtually everything in the unit needs to be worked on or replaced. He stated that the roof has various leaks, the project has not been painted since its inception, the parking lot asphalt is cracked, and there are various safety issues that need to be addressed. Mr. Boardman stated that he plans to make these units decent and affordable for families. Chairperson Calverley asked the Commission members if they had any questions for the applicant. Commissioner Wellman asked whether the City gets the money back for the second trust deed. Mr. Boardman replied that he has agreed to hold the rents below a fair-market value; the County, therefore, will not get money back from the applicant. The income the applicant is foregoing is in essence a payment for the funding he has received. Commissioner Wellman asked if appreciation or depreciation of the property has been considered. Mr. Boardman replied negatively. Commissioner Scarpelli stated that his observation of the property is that the property is one of the worst properties on that particular section of Laguna and said there are wonderful possibilities for the project based on other properties in the area. He asked if the County would supersede the applicant’s determination as to the scope of work. HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 5 Mr. Boardman replied affirmatively and stated that he would come up with what needs to be done with the assistance of the County with a walk-through looking at everything that needs to be done. He said that the County is extremely concerned with all the safety issues and hazards, and they tell the applicant what has to be done at a minimum. Mr. Boardman said that he will do cosmetics such as painting or new carpet. Mr. Boardman stated that the County will review what he wants to do, and they may ask him to do other things; then they will come to an agreement as to what needs to be done. Commissioner Scarpelli asked the applicant if he could back out of escrow if the County comes up with figures more than $12,000 per unit. Mr. Boardman replied that he does not have to proceed. He explained that all contingencies have been cleared except one, which is getting the money from the City of Carlsbad. He said that based on his previous experience, he feels comfortable that he can complete the full project the way it should be completed with the funds that have been requested. Commissioner Scarpelli expressed his concern for site management and asked Mr. Boardman what kind of program he had set up to supervise the site management. Mr. Boardman indicated the importance of good on-site management and stated there will be an on-site manager on the property. He will go through an advertisement process, a word of mouth process, and he will interview a variety of people and check their references to find a good on-site manager. Mr. Boardman said that whoever he chooses, he wants them there for a long time, and will require that they live on-site. In addition, Mr. Boardman said that he tries to visit all of his properties on a weekly basis, and if he cannot, he has a resident manager/property supervisor visit the sites, which has worked extremely well. Mr. Boardman stated that he has taken projects that were at least as difficult as this and turned them around. Commissioner Schlehuber asked if the applicant has an agreement with the County if the property is sold and there are a certain number of complaints against the property that the County could replace the property manager. Commissioner Schlehuber asked if there was some type enforcement mechanism. Mr. Boardman replied that there is nothing in writing and that with his other properties there has been no problems with any complaints. When there are problems, Mr. Boardman solves them. He said that the County can tell the Commission what the complaint ratio is. Commissioner Schlehuber expressed his concem if the property changes ownership and would like some guarantee that assets could be managed. Commissioner Rose asked Mr. Boardman how long he plans to keep a piece of property before he puts it on the market. Mr. Boardman replied that he intends to hold this property though the duration. Chairperson Calverley opened the public testimony and issued the invitation to speak. John Fahy, 935 Laguna Drive, Apartment 1, Carlsbad, CA addressed the Commission and stated that he and his wife have been the on-site managers of the Laguna Palms apartment complex at 935 Laguna Drive for the past six years. He stated that there is a lack of adequate on-site management at the 965 complex and it is causing problems at the 935 address. There are 17 apartments with an average of eight to ten people per apartment--at least 140 people overall, he said, and one family rents an apartment and subleases to two or three families, where each bedroom has a family living in it. He said that this is possible because there is no on-site management to prevent it. He said that frequently residents throw trash over the adjoining fence onto the 935 property, they break the fence board, and he has to buy and HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 6 replace the fence boards. He said there is a lot of noise at nights and he has had to call the police because there is no management to discuss this with. The 140 people in 17 apartments is wearing out the place and is an eyesore, making it difficult to rent at the 935 address. In addition, Carlsbad Police is there several times a week and during the summer they were there three times a day every day for two months. Mr. Fahy believes that strong on-site management is needed to control the situation. He said that the owner lives out of town and there is a person on-site who has no authority or experience to take care of anything. If anybody needs repairs, this person calls the owner or the management company. Scott Jones, 872 Laguna, Carlsbad, CA, and owner of 870,872,874, and 876 Laguna, addressed the Commission and stated that the place is a disgusting “pit” with no on-site management with 17 to 20 people in each unit. Mr. Jones said that the current owner is a lawyer from Palm Springs who doesn’t care about Carlsbad. He said the people on Laguna would really appreciate the City’s help. Bob Steckman from the County of San Diego addressed the Commission and stated that he manages the rental rehab section. He said that Mr. Boardman has done three successful projects since he has been with the County. One project was a 40-unit project, the last one of which was done under this type of a program with a 13-page agreement that ties everything up pretty solid. Mr. Steckman said that some of the Commissioners’ requests could be added very simply to the agreement. Commissioner Rose asked if the apartments are being occupied today, and if so, if the County evicts all the tenants while the building is in rehab. Mr. Steckman replied that he has not seen the apartments and the eviction is up to the owner. He stated that it would probably be fairly easy to legally evict the current tenants because of overcrowding, sublease issues, etc. He added that the owner cannot run people out without a reason. Relocation can get expensive legally by the federal government standards, so this has to be looked at fairly closely. The County does require that the units not be over the legal limit of people. He stated that in a four-bedroom unit, eight people is a legal number. Mr. Steckman said that the County requires a yearly certified process by the owner to inform them of incomes and number of residents per unit. Commissioner Rose asked if it is one family per unit or more than one family. Mr. Steckman replied that under the lease the County suggests they lease to one family, and said this could possibly be addressed in the agreement or at least in the enforcement of the rental agreement and the on- site manager. Commissioner Rose asked if Mr. Boardman would be subject to evicting the people there now. Mr. Steckman replied Mr. Boardman would be subject to the people there now to go in there and cleanup. He said that the County is zero tolerance on drugs, and the County cannot loan money for a unit where people have been or are being investigated for drugs. In the County program, if people are living there, and they are legal as far as their agreements, etc., then they would be eligible for rental assistance if they could prove that they deserve it. Commissioner Rose asked if the County is different from Carlsbad. Mr. Steckman replied that yes they are a little different. He said they have not done a rental program in Carlsbad and that they were in the middle of one on Jefferson Street, and when they inspected it, it drove the price way up and the guy bailed. He said there are some rules and regulations that can be adjusted because it is Carlsbad’s program, and because Carlsbad has its own money, the County is contracted to help to run that for the City. HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 7 Commissioner Wellman expressed concern about the enforcement mechanism. She asked if the County would oversee for the next 20 years how this project is managed. Mr. Steckman said that the County will monitor the construction of the rehab, from being involved with knowing who is in the units both before and after the rehab is completed, and once a year that is monitored on who is in there, what the rents are, what their incomes are. Other than that, there is no monitoring by the County for upkeep of the place. Commissioner Wellman mentioned how Southern California Edison is handling Villa Loma and asked what could be done to ensure a proper enforcement mechanism by the City of Carlsbad. Mr. Steckman said that it could be put into the agreement that if the property is sold that the funds would become due. He said that the option the County uses is the County will take a look at the buyer, and if everything seems to be fine, then the buyer has the option of paying off the loan or continuing the agreement. As far as looking at the project every six months or every year, the County does not have anything like that in any of its projects. Mr. Steckman said that he will drive by if he is in the area just to see how things are going. If things were going not so well, the next time that individual might apply, he said he can kick out the application based on the opinion they are not a fit owner; but that’s after the fact. In the seven years Mr. Steckman has been with the County, the County hasn’t had any problem with rehabilitations. Chairperson Calverley reminded the Commission that the details of agreements are something that are not the jurisdiction of the Commission. The Commission is simply being asked whether they approve or disapprove providing this money for reconstruction of this unit, and then it is Staff and the City Council’s job to make the agreements. Commissioner Wellman responded that part of making a decision as to whether this is a good deal is whether the property is going to be properly managed. If there is no real guarantee, Commissioner Wellman said she would have to think long and hard about her vote. Chairperson Calverley replied that the Commission has to trust the City Council to make these decisions. Commissioner Rose asked if upon resale of the property the City could demand payment of the note immediately. Mr. Steckman replied affirmatively. Mr. Scarpelli replied that he supports Commissioner Wellman’s points and that it is the prerogative of the Commission to raise the questions regarding site management before making a decision. Commissioner Schlehuber asked if the County has an operating agreement with the applicant. Mr. Steckman replied that the County has an operating agreement with the City of Carlsbad. Commissioner Schlehuber asked what kind of agreement they have with the applicant. Mr. Steckman replied that the applicant is in agreement with the City of Carlsbad and the County is hired to make sure that the applicant meets the agreement. Then, once a year it is supposed to be monitored by letter, maybe a site visit; but usually by letter and certification. There being no other persons desiring to address the Commission on this topic, Chairperson Calverley declared the public testimony closed and opened the item for discussion among the Commission members. HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 8 Mr. Becker responded to a few of comments, one being the question regarding other subsidies that might be utilized with the property. He said that right now the property cannot pass the Section 8 Housing Quality Standards Inspection, which is a major problem with Section 8 tenants living there. He said there is no subsidy that is attached to this particular transaction. Once the property is improved and would meet the housing quality standards, the City will have the option of then having Section 8 assisted people in there. The assistance that they would get would basically enable the City to have households in there that are going to have affordability below the 60 percent of median income level, which is a way of making it even more of a mixed-income affordable-type project. Mr. Becker stated that the principal amount of the loan is due at the end of the term of the loan (20 years). The idea of due-on-sale or transfer does not address the question of property management assurances, etc. The other thing it does is raise the issue again about whether the affordability restrictions continue. The idea is that the 20-year term of affordability matches the 20-year term of the grant that they get. It puts the City back into a different re-negotiation of the deal. Mr. Becker stated that on the issue of property management, there are no guarantees, especially concerning a transfer of the property. He said he cannot think of any mechanism that could be built in that would in effect guarantee what someone else is going to do with the property and added that there is no absolute guarantee that Michael Boardman will perform. Mr. Becker said that Staff is placing a lot of importance on the fact that Mr. Boardman has performed well with the high standards of the County. In terms of a transfer, Staff likes the idea that Mr. Boardman has the objective of holding his properties, which means the transfer may not come into play. The City is supposed to be looking at doing properties that have code problems and other problems such as these neighbors have mentioned. Staff would continue to have that code enforcement monitored, which is the best mechanism regardless of who owns the property. Where the City has interest in the property through a loan, Staff would be making sure there is code enforcement. Commissioner Scarpelli expressed concern about the City providing money to rehab this project, then having problems with the property five or six years down the line reverting back to its current condition. He stated that the City has code enforcement now, but has been unable to stop the current owner from what he has been doing with the property. He therefore does not know if code enforcement is the answer and would like the developer and Staff to figure out a way to ensure that the property is going to be maintained in the proper manner, not only for the livability of the tenants but for all the neighbors in the community. Commissioner Schlehuber said that with the City carrying a second trust deed on this property that there would be some rights that could be written in either on the trust deed that would say based on some complaint basis, that the second trust deed holder would have the right to select its own property manager. It could be in concurrence with the first trust deed. Commissioner Schlehuber said that the City of Carlsbad and the neighbor‘s have to have a right to respond to the problems this property might generate ten years from now upon a transfer or changes. Commissioner Wellman stated that she would like to have Staff check out Mr. Boardman’s other properties and asked for the addresses of the properties. Chairperson Calverley replied that according to the County there have been no complaints on these three properties. Commissioner Wellman said that the City of Carlsbad is entering into agreement with the County where the County will oversee the proper rehabilitation and construction of the project. For the next 20 years, it doesn’t seem that the involvement of the County will be that active. They will get an annual report from the --. HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 9 owners, but there is no agreement of planned on-site inspection of County people If that is the case, maybe there should be some vehicle for on-site inspection by the City. Commissioner Wellman suggested following what Southern California Edison demands, which is working well. Commissioner Schlehuber stated that the neighbors are the on-site inspectors in this case, and he does not think it is necessary for further levels of inspection. The neighbors are active in this area and will continue to keep the City and County informed of what is going on with that property. Commissioner Wellman replied that if the on-site people know there are going to be on-site inspections, that can nip a lot instead of waiting for more complaints to come in. Mr. Becker replied that the Commission is borderline getting into a negotiation session in reworking the agreement and said that the difficulty is having any kind of real standard that can be applied effectively. Always built into agreements is that the property is going to be inspected. Mr. Becker suggested, with the applicant’s acceptance, using the Section 8 Housing Quality Standard, which does involve a meticulous inspection of the property, and has very clear standards that are used all the time in the City, and is well beyond code enforcement level. A provision could be built into the agreement that should the property not pass the Section 8 Housing Quality Standard for any unit that the loan would be due. Commissioner Noble replied that the concerns have been noted on the record, and the City Council reads the minutes closely. He said that it is not the Commission’s place to get into negotiation because the Commission is a recommending authority. Commissioner Scarpelli replied that the Commission recognizes its advisory role to the City Council, but he does not see any reason why the Commission cannot make a recommendation to the City Council if the developer has no objection to the recommendation. Commissioner Scarpelli would like to put it into the motion. Chairperson Calverley asked the developer how he feels about the Commission putting the Section 8 inspection process into the motion. Mr. Boardman said that he would like a period of time to cure any problems that may arise on the property, and he does not have a problem with an agreement giving him a reasonable time to cure problems and certain things that are out of violation. Chairperson Calverley stated that the details can be worked out and it was time to get a motion on the floor. ACTION: Motion by Commissioner Scarpelli, and duly seconded, that the Housing Commission ADOPT Housing Commission Resolution No. 96-01 2, recommending APPROVAL of financial assistance in an amount not to exceed $21 6,750 from the City of Carlsbad Redevelopment Low and Moderate Income Housing Set-Aside Fund for the purpose of rehabilitating 17 rental housing units located at 965 Laguna Drive to be occupied and affordable to low income tenants, and that Staff work out with the developer an inspection process to assure proper site management using Section 8 standards. Calverley, Escobedo, Noble, Rose, Sato, Scarpelli, Schlehuber, Walker, Wellman VOTE: 9-0-0 AYES: NOES: None ABSTAIN: None Chairperson Calverley asked if there was anybody in the audience who would like to speak on the second item on the agenda. There being nobody desiring to address the Commission on this topic, Chairperson Calverley moved the third agenda item up to number two. HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 10 2. ARROYO LA COSTA AFFORDABLE HOUSING AGREEMENT - Request for recommendation of approval of an Affordable Housing Agreement between the City of Carlsbad and the Villages of La Costa establishing a City-wide program assisting lower-income Carlsbad resident households with first- time home purchases. Evan Becker reviewed the background of the request and stated that this item deals with a project that is part of the overall Villages of La Costa and it specifically deals with a portion of La Costa that finalized a Master Plan some years ago known as Arroyo La Costa or La Costa Southwest. Mr. Becker said that he Commission is being asked to recommend approval of this program to the Council. The program is embodied in an agreement with Arroyo La Costa which is substantially complete, but some of the details are yet to be worked out. The program that has been proposed by the developers of Arroyo La Costa, which is the arm of Bank of America that is working on the completion of the Villages of La Costa, is to provide funding for a first-time homebuyer program available city-wide. The amount of funding to be provided would be $3.2 million-an amount roughly equivalent to what the impact fee requirement would have been for this particular project, however, the payment of these funds to support this program would be accelerated in comparison to the payment of impact fees which are paid at the issuance of building permits. Mr. Becker stated that the use of the funds provided by the developer would be to fund deferred payment second mortgage loans as well as the reasonable cost of servicing the loans. Mr. Becker stated that this will follow the same first-time homebuyer deferred payment second mortgage loan model that was presented with the Sambi Seaside Heights and Carillo Ranch projects. In addition to the amount being roughly equal to what the impact fee obligation of Arroyo La Costa would be, it also comes out to be an amount which at $20,000 per first time purchase would support 160 households going through the process of becoming homeowners for the first time. Mr. Becker stated that one of the features of the program that Staff thinks is a win-win situation for both the City and Bank of America is that the City is utilizing an arm of the bank, the Bank of America Community Development Bank, which is the affordable housing arm of the bank, and is very skilled in doing a variety of affordable housing programs, including first-time homebuyer lending. This is an unusual and fairly unique situation to be in with a bank as developer that brings with it a part of the bank that can actually help the City set up and implement as well as fund the affordable housing program that satisfies their obligation under the Master Plan. Mr. Becker stated that the bank would be involved in the administrative role as long as the loans were outstanding and needed to be serviced. Mr. Becker stated that first-time homebuyers are defined as not having owned a home in three years. There will be some other parts of that first-time homebuyer definition that will allow for single parents to buy a home even though they had just owned a home prior to the dissolution of a marriage. Mr. Becker stated there are certain situations or cases where the City would like to provide for. Another provision is that the buyer reside in Carlsbad. Mr. Becker stated that there would be an upper limit purchase price of $155,000, which is the FHA maximum purchase price. This cap is designed to be an upper limit on what a reasonable home purchase price is for somebody who is a low-income first-time homebuyer. Above that limit, the City does not have the subsidy available to make the acquisition possible; plus as a first-time home purchase, there are adequate supplies of decent units under that limit that will serve the purpose. In reality, the purchase price limit in the program will be based on the maximum first mortgage loan that the household can quality for, plus their down payment, plus to up $20,000 to bring them up to the price of the home they are looking for. For a family at 80 percent of median income looking for a three-bedroom home, it is probably going to be somewhat below $155,000; but Staff thinks with $20,000 and given a range of incomes from 60 percent up to 80 percent of median income, there will be purchase prices on the low end at slightly over $1 00,000 on HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 11 up to $145,000. These will be modest units, probably condominiums or older small single-family detached homes. Mr. Becker stated that the assistance is a deferred second loan. In this case Staff would like to see at least some recovery of the principle of the money at some point in time, so it is deferred for five years and then there is a repayment of the principle over the next ten years. Mr. Becker stated there are no price restrictions on resale, which is the model of recapture. A transfer would be at a market price, with a recapture of any outstanding balance on the CHAP second loan as well as a share of appreciation. Mr. Becker added that the appreciation model involves sharing in a portion that is based on the buyer's initial contribution versus the City contribution up to $20,000. Mr. Becker said that as with the Sambi and Carillo Ranch projects, this serves a very important need in terms of a Housing Element objective of providing first-time homebuyer financing. He said that this project is labeled a medium priority; and said the only high priority is basically large family, very low income rental housing. Approval of this project gets balance into the City's program according to Mr. Becker. Mr. Becker pointed out that it is a condition of this particular project not to build units4 does not have an lnclusionary Housing condition that requires construction of units and actually the condition regarding affording housing for this project was written a long time ago prior to the lnclusionary Housing Ordinance; however, there was reference to meeting an affordable housing obligation and doing what the Housing Element would prescribe. That left it fairly wide open in terms of what could be done, and Staff has chosen to have them meet their obligation by doing something that is supported very much by the Housing Element that was put in place subsequent to the approval of their Master Plan. Mr. Becker said that there is not really a feasibility aspect to this project like there is a rental housing proforma; but the City and the Bank as partners need to be sure that the program can be delivered and is workable. Mr. Becker said that the City has a partner who has one of the strongest capabilities in terms of delivering this type of program. Mr. Becker said that the up to $20,000 of subsidy will work in terms of there being enough product out there, and Staff thinks the affordability income eligibility ranges will produce enough people with enough income to buy the units given the City's subsidy. Mr. Becker stated that this program is really a win-win-win situation because it resolves a major condition for this project to go forward with a thousand units and it provides the housing affordability through an important program that is a Housing Element objective. Given the Staff situation and the on-going attempt to do every kind of program there is with very limited staff, this program would be difficult to create without the leverage of the bank, their money, and their running the operation. The program will be according to City rules and there will be oversight and reports to ensure its successful. Staff recommends the Commission recommend to the Council support of an agreement that will implement this program. Chairperson Calverley opened the item for discussion among the Commission members. Commissioner Wellman requested information regarding the $3.2 million, leveraging, and the developer's contribution. Mr. Becker responded that the City is taking $3.2 million from the developer and depositing it in a fund. He said that the money comes in as the developer finalizes the various phases of this particular approved Master Plan, coming in at the rate of about $300,000 for each 100 units. HOUSlNG COMMISSION MINUTES NOVEMBER 14,1996 PAGE 12 Mr. Becker used the “Initial Purchase” overhead to further explain the details of the program. Mr. Becker explained the CHAP second mortgage and the distribution of funds at resell. He also explained the 90-10 ratio and how credit is applied for improvements to the property. Mr. Becker stated that this example is similar to the model the Commission has seen before; however it is simpler than the Sambi model because all the City is doing with this program is making second mortgage loans. Staff feels strongly that this type of program can actually support new construction because it helps somebody buy a home for $125,000 and could be an incentive for developers to build some of that product because the City can help finance the purchase. In addition, this program can be targeted to the older, existing neighbors, giving people a chance to become homeowners in those neighborhoods where there is more moderately priced housing and helps with the revitalization and stability of those neighborhoods. Commissioner Scarpelli commented that Staff has developed a fantastic program where the City is getting back $1,000 that it never put out. He asked if this is an offset to going for development fees, that the CHAP money is in preference to development fees. Mr. Becker replied that it was and explained the shared appreciation concept as a contingent interest on what the City has put in. The appreciation the City gets is what is being charged for the money eventually. Commissioner Wellman asked Mr. Becker to address the aspects of the living-in-Carlsbad loan qualification and asked if this is legally enforceable. Mr. Becker said that the transaction would not be approved if somebody came up with a unit in another city. Commissioner Wellman asked about circumstances where a family could no longer afford the property after five years. Mr. Becker replied that the City will reserve the right to forebear, if necessary. It will not be offered as a right; but it if got down to that situation on the second, the City would have the right to forebear, extend, or set up some kind of different payment schedule. Mr. Becker explained that it would take somebody a little over an 1 percent increase in income a year-a little over 5 percent overall in five years-based on 30 percent of income, to be able to handle $166/month. Mr. Becker added that these are the same situations that Bank of America runs into in any kind of conventional loan program. He said that the City is notified of foreclosures, etc. Commissioner Schlehuber asked what would be happening to the money after five years, who would be administering the recycled dollars. Mr. Becker replied that Staff has the ability to assign it to another institution. He said that there is no such thing as the Staff running the whole program; but Staff will have the ability to either extend it with Bank of America or assign it to another institution at any time. Mr. Becker said that one thing unusual about this program is that they are not typically lower-income affordable programs. They are low mod, which means you can go up to 120 percent of median income-that’s twice the income Staff expects some of the people in this program will have. If there are not enough buyers with this type of subsidy, because there is not product out there, Staff has the ability to change it. Commissioner Schlehuber commented that Bank of America has the ability to make 3 percent loans and said that he would like to target these funds to increase homeownership in specific areas of the city, especially in Track 179. He asked Staff if they have had discussions about this with the bank. Mr. Becker replied that there is an interest on the bank’s part on bringing their other programs to bear on this, including the 3-2 down payment program and some other things as well. Mr. Becker said that the City has their own Mortgage Credit Certificate (MCC) program, which is another tool Staff will try to bring to this HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 13 program because it helps elevate the purchase price that someone could find a unit at or cause the program to help someone at lower incomes. Commissioner Schlehuber asked how Bank of America would market the program and commented that he would like to target areas of the City that need it. He also asked how Staff would market the program. Mr. Becker replied that there are two levels of marketing. The developer has the primary responsibility for marketing the program; so anything the City does is over and above what the developer does. Staff would aggressively market the program, similar to what has been done with mortgage credit certificates. Specially Staff advertises through the Board of Realtors with brochures; training sessions with brokers and lenders; and outreach in 179. Staff has a goal of bringing about homeownership and more stability in 179; however, there is some difficulty building in very specific priorities because of fair housing laws. Commissioner Schlehuber asked if Bank of America would commit to bringing their other programs to bear to go with this, especially the 3-2 program. Mr. Becker replied that Bank of American could answer that question. Chairperson Calverley invited the applicant to speak. Fred Arbuckle, General Manager of Villages of La Costa, 2300 Alga Road, Carlsbad, CA addressed the Commission and said Villages of La Costa is the name of the community that he hopes is developed over the coming years. Mr. Arbuckle stated that he was surprised about how much of a commitment the bank wanted to made to affordable housing and how much they have done in a number of different areas for affordable housing. According to Mr. Arbuckle, the program provides for homeowner opportunity; it is non- specific to location; it continues to fund new loans over a long period of time, which allows for homeowners to build equity and move up then allows somebody else to come in and build their dream. Mr. Arbuckle said that this is his first opportunity since acquiring the property last year to deal with affordable housing. He stated the location of the first phase of development for Arroyo La Costa and said that it totaled 485 acres approved for Tentative Map and Master Plan in 1990 with 1,073 homes. The site will include a junior high school, an elementary school, a church site, a daycare site, and a community recreation facility. Mr. Arbuckle said that Condition 44 of the Tentative Map speaks to affordable housing and gave some history of the affordable housing requirements of the property. Mr. Arbuckle pointed out that the text in the Master Plan (88-1) states that the Arroyo La Costa Master Plan does not propose to construct any affordable housing in the area covered by the Master Plan. He mentioned the part of the lnclusionary Housing Ordinance that pertains to maps that were single-family residential projects of any size that were granted their approvals on or before the effective date of the Ordinance, which was passed in April of 1993. Mr. Arbuckle stated that this program will fund approximately 160 deferred second mortgages, a total commitment of $3.22 million over the life of the project. Mr. Arbuckle added that one of the neat features about the program for the City is that instead of paying a small fee at building, the developer will pay a large amount of fees at the recordation of Final Map. Right now the developer is looking at finalizing a map for a total of 455 homes, which means a contribution of $1.3 million to this program within the next couple of months. Mr. Arbuckle said that the money is loaned for 15 years; there is no payment for five years; the principle reduction is over the next ten years; and there is shared appreciation with the City based upon the original contributions. Mr. Arbuckle stated the restrictions as being a resident of Carlsbad, the home must be located in Carlsbad, due on sale to refinance, and the home must be owner-occupied. HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 14 Mr. Arbuckle stated that the developer gives the money to the City, and Bank of America manages and has access to the funds with the permission of the City to fund the loans. The money can earn interest, and the City can change the requirements for the loans at any time, Le., repayment requirements, any portion of the program as long as it is providing affordable housing. Mr. Arbuckle showed an overhead showing the affordable housing in the City of Carlsbad. He stated his amazement at the even distribution of homes currently for sale below $140,000, especially in the southeast quadrant with a total of 543 homes available. He said there 179 available in the southwest quadrant, 36 in the northeast quadrant, and 23 in the northwest quadrant. Mr. Arbuckle showed a graph with the distributions of the price of homes in all four quadrants. He stated there are some homes below $60,000 and a lot of homes in the $80,000 to $1 00,000 and $1 00,000 to $120,000 and $120,000 to $140,000 ranges. Mr. Arbuckle said that 828 homes available for this program is significant. Commissioner Scarpelli asked if most of the units are condos. Mr. Arbuckle replied affirmatively and said that in addition there are 14 single-family homes that the developer recently found out about that are priced below the $1 55,000 range. Mr. Arbuckle showed an overhead describing how the program works and stated that the developer is the initiating entity for the Carlsbad CHAP fund. He said that while Arroyo will ultimately contribute $3.22 million, the City can throw other monies into the CHAP. The Bank of America servicing arm will take care of the funds, initiate the loans, and service the loans. When the loans are retired, the money flows back into the CHAP fund and continues to be recycled through the system time and time again over the years. Mr. Arbuckle said that if this program is a success, other monies can be added to the program to help it grow. Mr. Arbuckle addressed an earlier question regarding the bank bringing other programs to bear on this program. Mr. Arbuckle stated that he has had discussions with a member of the Staff in San Diego, and said there is a program currently available with 3 percent down, excluding the second. With 3 percent down, all closing costs are waived. Commissioner Schlehuber asked if there was a limitation on that. Mr. Arbuckle said there was not and that this program will work with Fannie Mae. In addition, the money does not necessarily have to be borrowed from Bank of America. Commissioner Wellman asked if this program could continue with another entity besides Bank of America and asked if the Villages of La Costa is the development part of Bank of America for this project. Mr. Arbuckle replied affirmatively and said that Bank of America holds its assets, the real estate-owned department. Owned real estate is put into the real estate collateral management branch. The property is disposed of through a number of different scenarios depending upon the property. Mr. Arbuckle said that the $3.22 million commitment is specific to the Arroyo property. And there will be a specific agreement for servicing for a certain amount of time. Mr. Arbuckle stated that Mr. Becker is suggesting an initial five-year period, but it can be extended into the future. Commissioner Wellman asked whether Bank of America has run a similar program elsewhere. HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 15 Mr. Arbuckle replied negatively, not for the real estate collateral portion of the bank. He said that a different division of the bank has funded over $12 billion into various forms of housing assistance and programs, however. Commissioner Escobedo asked when the program would be in effect. Mr. Arbuckle said that the first monies will be funded with the first Final Map, presently scheduled for next month. The fund will be put together, the operating agreement will be in place, and within the first quarter of next year loans should be available. Chairperson Calverley declared the public testimony closed and opened the item for discussion among the Commission members. Chairperson Calverley stated that she would like the agreement to be amended to include not only residents of Carlsbad but include people who are employees in the City of Carlsbad. She added that one of the things the City is trying to accomplish through affordable housing is being able to have manufacturers and companies who move to Carlsbad have a work force that is within a reasonable distance of their businesses. She said that this may encourage perspective businesses to move into Carlsbad. Commissioner Noble asked about the legal ramifications of this change. Mr. Becker stated that this is something the City can do and it has been done before. Additionally, he said that it helps to take some pressure off the City in terms of fair housing concerns because by opening up the market, the City is less vulnerable to being inclusionary to certain protected classes, opening it up more to a larger population. A program restricted solely to Carlsbad residents would be discriminatory if the demographics of that area of Carlsbad are not a mirror of what they are in the county. Mr. Becker said this is consistent with the live/work priority that has already been established. Commissioner Wellman asked if there is a length of time one has to be a resident or be an employee in Carlsbad. Mr. Becker replied that it is 30 days, which is a very short period of time because of the discriminatory concern. ACTION: Motion by Commissioner Wellman, and duly seconded, that the Housing Commission ADOPT Housing Commission Resolution No. 96-014, subject to the amendment that the applicant pool include Carlsbad residents and/or employees of Carlsbad businesses, recommending APPROVAL of an Affordable Housing Agreement with the Real Estate Collateral Management, Inc., which establishes, funds and operates the Carlsbad Homebuyer Assistance Program (CHAP) as the method of satisfying the affordable housing obligation of the Arroyo La Costa Master Plan (MP 88-1). Calverley, Escobedo, Noble, Rose, Sato, Scarpelli, Schlehuber, Walker, Wellman VOTE: 9-0-0 AYES: NOES: None ABSTAIN: None 3. ASSESSMENT OF IMPEDIMENTS TO FAIR HOUSING CHOICE - Request for Housing Commission approval of a recommendation to the City Council to submit the Assessment of Impediments to Fair Housing Choice to the U.S. Department of Housing and Urban Development. HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 16 Leilani Hines reviewed the background of the request and stated that as a condition of the HUD Consolidated Plan the City has to certify that it is affirmatively furthering fair housing, and the Assessment of Impediments is the first step in furthering fair housing and to do fair housing planning. Ms. Hines described the purpose of the Fair Assessment and said that the report was prepared with information from other organizations such as the U.S. Department of HUD. In addition a fair housing survey prepared in 1994 by the City was used to prepare this report as well as Home Mortgage Disclosure Act (HMDA) data from the City/County Reinvestment Task Force. Ms. Hines described the Carlsbad demographics as a community comprised of 82 percent white, 14 percent Hispanic, and 1 to 3 percent blacWAsian. About 16 percent of the population is elderly household, while 30 percent are families, according to the 1990 census. Ms. Hines stated that Carlsbad is primarily a community of owner-occupied housing, about 62 percent; with 38 percent rental. The owner-occupied stock is comprised of larger homes, while the rental stock is comprised of mostly two-bedroom units, with few three-bedroom units. Ms. Hines stated that there is only one census track in the community that has a high percentage of minority households--the Barrio area--with 53 percent minority while the city-wide percentage is 18 percent, indicating a significant concentration in comparison to the city overall. Ms. Hines stated there are about five census tracks or areas where there are low-income populations, which are within Census Track 179 with the concentration of minority households and lower income households. She said this could be due to the fact that this is one of the City’s older housing areas with a concentration of the City’s multi-family rental housing and probably the most affordable areas in Carlsbad. Ms. Hines stated that with the demographics in mind, some conclusions may be made regarding socio- economic or racial segregation in the City. She said that some of the factors that were looked at were (1) what are local statistics telling us about housing discrimination in the City; (2) what does the HMDA data tell us; and (3) what does the Section 8 Rental Assistance program tell us. She said that the City currently contracts with Heartland Community Relations to provide an education and counseling program. This program consists of doing outreach and education in the community as well as processing any complaints against the City. The City has literature regarding Heartland Human Relations at various facilities. In addition, the Housing Department and many other City departments refer clients to Heartland Human Relations. There were 64 cases referred in 1994 or handled by Heartland Human Relations. Only five of the cases were based on discrimination. The 64 incidents indicates that the word is getting out that Heartland is available for questions regarding landlord-tenant relations or discrimination in housing. Ms. Hines stated that the HMDA data refers to the Home Mortgage Disclosure Act which requires lenders to disclose lending activity by census track. According to the HMDA data, the denial rates in Carlsbad are pretty comparable to those in San Diego County; however, African/Americans and Hispanics have a higher denial rate than whites in the community. Ten percent of the residential mortgage loans closed were made by ethnic minorities; and the higher level of income within the census track, the higher the level of lending. Ms. Hines stated that these statistics may be misleading because the HMDA data is inconclusive. In addition, the number of minorities in the HMDA data was very small and therefore statistically not very reliable. Regarding the Section 8 Rental Assistance program, 63 percent of the Section 8 certificates and vouchers are used in Census Track 179. This leads back to the affordability issue and the housing stock is primarily there. The distribution of the vouchers by ethnicity is not really heavily concentrated in one area. Whites are just as likely as Hispanics to locate in one census track or another, particularly 179; therefore there is no type of segregation regarding ethnicity with the program. HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 17 Ms. Hines stated that the 1994 Fair Housing Survey, which was previously bought before the Housing Commission, did not show that citizens were concerned or felt there was housing discrimination going on in the community. She said that 40 percent of the 622 respondents of the survey said that housing discrimination is not a problem within the community. These respondents said that they believed that education and outreach is the best way to combat the problem. Ms. Hines stated that the City currently participates and advocates fair housing. The City is a member of the Community Housing Resource Board, which is comprised of fair housing advocates. Heartland Human Relations is contracted to do the education, the outreach, and to process complaints. The City has been making strides with the Section 8 program to do outreach to property owners outside 179 to get them interested in the program. The lnclusionary Housing Ordinance has helped to bring affordable housing stock to other areas of the community other than the northwest or Census Track 179. Ms. Hines stated that the study says that Census Track 179 comes up over and over again with a higher percentage of minority households and the higher percentage of low-income households, that the lender denial rates for that census track are slightly higher, but they are pretty comparable to other census tracks within the City. The study indicates that the City does have some low-income programs, particularly the lnclusionary Housing Ordinance that are designed to promote racial and ethnic balance within the com m u n ity . Ms. Hines concluded that the City's fair housing services are not complete and they may need to expand with fair housing audits and tests to make sure that discrimination and equal housing opportunity is being practiced in the community. Ms. Hines stated that there were some general and basic recommendations in the report which include to conduct fair housing auditshests as the City and Heartland Human Relations deem necessary to promote geographic choice for the Section 8 Rental Assistance program; to continue the outreach efforts and expand them when possible; to encourage the development of affordable housing throughout the City; and to continue to contract for fair housing and educational services. Ms. Hines said that with these conclusions and recommendations, Staff is asking that the Commission recommend approval of this document and submission to the U.S. Department of HUD to satisfy the federal regulations for the City and the CDBG and the Home program. Chairperson Calverley opened the item for discussion among the Commission members. Commissioner Wellman asked if gender is part of the report. Ms. Hines replied that the primary focus of fair housing/equal housing choice is always geared toward ethnicity and then families, and families with children are a big concern. Ms. Hines believes that gender is not covered by federal law. Commissioner Wellman asked if this study would address long-term housing for the homeless or people with AIDS or other special needs. Ms. Hines replied that these issues would not fit into this report. To the extent that the City has policies or practices that make it more difficult for those housing types to come into play, e.g., for group homes, then that becomes a fair housing issue and an inclusionary housing issue. HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 18 Commissioner Wellman asked how many group homes are in Carlsbad, how many single-room occupancy dwellings, and if there are other populations that may need specialized housing. She asked if the City had any statistics on these areas. Ms. Hines replied that she does not currently have those statistics but it was something that Staff could look into and add to the report. Mr. Becker replied that the City does not have any of these statistics because in the City these would be special use permits. He said he has seen nothing in the Housing Element reports. Additionally he said that Staff can try to find out about these issues. Commissioner Noble reminded Mr. Becker that the City did not have this information when there was talk of building businesses with SROs on top across from the Carlsbad Lutheran Home, where the spa is built now. Commissioner Noble remembered that this issue was brought up then and nobody had an answer. Commissioner Wellman suggested thinking about these issues if part of the City’s goal is to meet the various needs of various sections of the community. Commissioner Noble stated that Staff is not budgeted or staffed for this. He therefore recommended making minute motions to add any recommendations. Commissioner Wellman stated that the topic ”fair housing, affordable housing” can be a big umbrella, and she specifically wanted to know if these issues fall under this umbrella. Chairperson Calverley stated that the Council has been attempting for some time now to write a SRO ordinance. ACTION: VOTE: AYES: NOES: ABSTAIN: ACTION: VOTE: AYES: NOES: ABSTAIN: Motion by Commissioner Scarpelli, and duly seconded, that the Housing Commission ACCEPT public comments regarding the City of Carlsbad’s Assessment of Impediments to Fair Housing Choice for the Community Development Block Grant Program and ADOPT Resolution No. 96-013 recommending City Council authorize the Housing and Redevelopment Director to submit the Assessment of Impediments to Fair Housing Choice to the U.S. Department of Housing and Urban Development. 9-0-0 Calverley, Escobedo, Noble, Rose, Sato, Scarpelli, Schlehuber, Walker, Wellman None None Minute Motion by Commissioner Wellman, and duly seconded, that the Housing Commission request City Staff, subject to the approval of the City Council, for an inventory of single-room occupancy dwellings/homes for AIDS people and group homes for special-need adults within the City of Carlsbad. Calverley, Escobedo, Rose, Sato, Scarpelli, Schlehuber, Walker, Wellman Noble None 8-1 -0 ANNOUNCEMENTS: Mr. Becker gave an update on Laurel Tree and said that Staff will try again to apply for the low income tax credits for the round of allocations in February. All the work that has been done to pressure for a change in HOUSING COMMISSION MINUTES NOVEMBER 14,1996 PAGE 19 the State allocation system will produce a fair system that will not continue to deprive San Diego County. With a regional allocation the City is assured of getting a certain portion based on housing need. Mr. Becker stated that the project received the Home funds after being on a waiting list and with the expectation that funds would not become available. Because enough projects dropped out, Laurel Tree can be funded. The developers agreed to make up the money when it feel out, and they will keep their shares in to, making the application more competitive. Commissioner Scarpelli reported that some people from San Diego State, looking at the possibility of low- to moderate-income housing for students at State, were impressed with the Villa Loma project. Mr. Becker announced that the next Housing Commission meeting is scheduled for December 12,1996. ADJOURNMENT: By proper motion, the Regular meeting of November 14, 1996 was adjourned at 8:36 p.m. Respxtfully submitted, EVANBECKER Housing and Redevelopment Director KATHY VAN PELT Minutes Clerk MINUTES ARE ALSO TAPED AND KEPT ON FILE UNTIL THE WRITTEN MINUTES ARE APPROVED.