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HomeMy WebLinkAbout1998-12-10; Housing Commission; Minutes.- e Minutes of HOUSING COMMISSION Time of Meeting: 6:OO P.M. Date of Meeting: DECEMBER 10,1998 Place of Meeting: CITY COUNCIL CHAMBERS CALL TO ORDER: Chairperson Wellman called the Regular Meeting to order at 6:08 p.m. PLEDGE OF ALLEGIANCE: Chairperson Wellman led the pledge of allegiance. ROLL CALL: Present: Chairperson Wellman, Commissioners Escobedo, Latas, Noble, and Walker Absent: Commissioners Calverley, Rose, and Scarpelli Staff Present: Debbie Fountain, Housing and Redevelopment Director Craig Ruiz, Management Analyst APPROVAL OF MINUTES: ACTION: Motion by Commissioner Walker, and duly seconded, to approve the Minutes of the Special Meeting of November 19, 1998, as submitted. Escobedo, Latas, Noble, Walker, Wellman VOTE: 5-0-0 AYES: NOES: None ABSTAIN: None COMMENTS FROM THE AUDIENCE ON ITEMS NOT LISTED ON THE AGENDA: There were no comments from the audience. NEW BUSINESS: 1. CT 98-05 - ARIE DE JONG, JR.. FAMILY TRUST - APPLICATION TO PURCHASE 4.2 AFFORDABLE HOUSING CREDITS IN THE VILLA LOMA HOUSING PROJECT FOR THE AIRE DE JONG, JR., FAMILY TRUST. Craig Ruiz reviewed the background of the request as described in the Staff Report and stated that there is an SDG&E easement on the property. Mr. Ruiz described the feasibility of the on-site proposal; the relative advantages and disadvantages of an off-site proposal; and how this project advanced the City’s Housing Goals and Strategies. Mr. Ruiz stated that Staff recommends this project with two slight changes to the Housing Agreement as follows: > Delete the words “Western Pacific Housing” from the fist paragraph of the Affordable Housing Agreement (Exhibit 3 in the Staff Report). Delete the last sentence in the “Hold Harmless” section that reads, “Developer shall obtain, at its expense, comprehensive general liability insurance for development of the ($1,000,000) purchased by the Developer from an insurance company duly licensed to engage in the business of issuing such insurance in the State of California, > .- HOUSING COMMISSION MINUTES December 10,1998 Page 2 with a current Best’s Key Rating of not less than A-V, such insurance to be evidenced by an endorsement which so provides and delivered to the City Clerk prior to the issuance of any building permit for the Project.” Mr. Ruiz said that this sentence pertains to insurance for affordable housing, which the applicant does not need to provide since they are not building affordable units. Chairperson Wellman asked if there were any questions of Staff. Commissioner Escobedo asked if this site is close to Laurel Tree. Mr. Ruiz responded that it is relatively close. Chairperson Wellman asked who within the City determines what the developer will pay. Mr. Ruiz responded that the Finance Department sets the fee using a formula that is determined on the lst of July each year. Chairperson Wellman opened the item for discussion among the Commission members. There was no discussion. Chairperson Wellman invited the applicant to speak. Mr. Jack Henthorn, Jack Henthorn & Associates, 5375 Avenida Encinas, Suite D, Carlsbad, 92008, addressed the Commission and stated that he is the representative for the Arie de Jong, Jr. Family Trust. He said that he is in agreement with Staffs recommendation with the two proposed changes mentioned by Mr. Ruiz. Chairperson Wellman asked if there were any questions for Mr. Henthorn. There were none. Chairperson Wellman opened the item for discussion among the Commission members. Commissioner Noble pointed out that this project will help to get Poinsettia completed quicker. Chairperson Wellman opened the public testimony and issued the invitation to speak. There being no other persons desiring to address the Commission on this topic, Chairperson Wellman declared the public testimony closed and opened the item for discussion among the Commission members. ACTION: Motion by Commissioner Noble, and duly seconded, that the Housing Commission ADOPT Resolution No. 98-9 16, recommending that the City Council APPROVE a request by THE ARE DE JONG, JR. FAMILY TRUST, to purchase 4.2 Affordable Housing Credits in the Villa Lorna housing project in order to satisfy the affordable housing obligation of the Aire de Jong project under the City’s Inclusionary Housing Ordinance with the corrections presented by Staff. Escobedo, Latas, Noble, Walker, Wellman VOTE: 5-0-0 AYES: NOES: None ABSTAIN: None ANNOUNCEMENTS: Ms. Fountain announced that Craig Ruiz has been working hard on the Laurel Tree and Carillo Ranch projects. She added that the Laurel Tree project should close on Tuesday. . HOUSING COMMISSION MINUTES December 10,1998 Page 3 Ms. Fountain stated that the next meeting would be January 14,1999. She added that the Housing Element workshop would probably be held in January. Commissioner Escobedo mentioned that she received a phone call from a woman named Lisa from Oceanside. Lisa expressed extreme concern for the plight of the homeless in Oceanside and the lack of affordable housing for low- income folks. Apparently Lisa would like to contact all levels of government about this problem. Commissioner Escobedo gave Lisa several phone numbers of individuals to address Lisa’s concerns. Ms. Fountain stated that concerns of this sort could be sent to the City of Carlsbad’s Housing and Redevelopment Department. Staff will direct the person(s) to the correct resource, she said. Commissioner Noble suggested holding a workshop or brainstorm session to discuss the wants and desires of the Housing Commission after one of the Housing Commission meetings. He would like to see the results of the workshop forwarded to the City Council. Ms. Fountain responded that this would be accomplished at the Housing Element workshop that will probably be held in January. ADJOURNMENT: By proper motion, the Regular meeting of December 10, 1998 was adjourned at 6:3 1 p.m. Respectfully submitted, n DEBBIE FOUNTAIN Housing and Redevelopment Director KATHY VAN PELT Minutes Clerk MINUTES ARE ALSO TAPED AND KEPT ON FILE UNTIL THE WRITTEN MINUTES ARE APPROVED. I The City of Carlsbad Housing & Redeuelopxnent Deparfment AREPORT TO THE HOUSING CO~XSSXON Btafi: craig D. ~lliz Management malm DATE: DECEMBER 10,1998 SUBJECT: CT 98-05 - ARIE DE JONG, JR. FAMILY TRUST - APPLICATION TO PURCHASE 4.2 AFFORDABLE HOUSING CREDITS IN THE VILLA LOMA HOUSING PROJECT I. RECOMMENDATION That the Housing Commission ADOPT Resolution No. 98-016, recommending that the City Council APPROVE a request by THE ARIE DE JONG, JR. FAMILY TRUST, to purchase 4.2 Affordable Housing Credits in the Villa Loma housing project in order to satisfy the affordable housing obligation of the Arie de Jong project under the City's Inclusionary Housing Ordinance. 11. BACKGROUND The applicant, the Arie de Jong Family Trust, is currently processing an application for a tentative map (CT 98-05) to develop 28 single family homes on approximately 33.4 acres. Due to the environmental and topographical constraints of the site, approximately 64% of the site will remain as open space. The project consists of home sites with parcel sizes ranging from 7,500 to of 18,500 square feet. The development of 28 homes will require the developer to provide 4.2 units of housing affordable to lower income households as required by the City's Inclusionary Housing Ordinance. It is the applicant's position that there are significant economic burdens on the site which would make it difficult to provide the affordable housing units on-site. Therefore, the applicant is requesting to purchase Affordable Housing Credits ("credits") in the Villa Loma project in lieu of on-site construction. The City's Inclusionary Housing Ordinance permits off- site satisfaction of an inclusionary requirement through participation in a Combined Inclusionary Housing Project ("Combined Project") if the City Council determines that it is in the public interest. Purchase of credits in the Villa Loma project constitutes participation in a Combined Project. There are 126 credits currently available for purchase. CT 98-05 - DE JONG DECEMBER 10,1998 PAGE 2 Policies ReFardinp Off-Site Proiects and Purchase of Affordable Housing Credits The City Council has adopted two policies which address off-site or Combined Projects and the sale of Affordable Housing Credits. Council Policy 57 was developed to establish the criteria to be utilized in order to make the necessary finding that off-site satisfaction of an inclusionary housing requirement, when proposed through a Combined Project, is in the public interest. Council Policy 58 was established to determine the price of credits and the mechanism to satisfy a developers obligation under the City's Inclusionary Housing Ordinance. 111. DISCUSSION The Council Policies, as noted above, require staff to evaluate the request for off-site satisfaction of the inclusionary housing obligation and the purchase of credits based upon three primary criteria. The criteria includes: 1) feasibility of on-site proposal; 2) relative advantages/disadvantages of an off-site proposal; and 3) the advancement of housing goals and strategies. The following is a summary of staffs analysis of the criteria for the project. Feasibility of On-site ProDosal The small size of the developable area, the physical constraints caused by the large slope areas and a 100 foot wide San Diego Gas and Electric easement which bisects the property and the on-site environmentally sensitive areas limit the ability to produce on site affordable units due to restrictions on project yield. Also, the small scale of the affordable housing project makes the development economically unfeasible due to the significant financial subsidy which would be required for the project. Further, the small scale of the affordable housing project makes it unlikely that the project will generate interest fiom available finding sources. Relative AdvantaPes/Disadvantapes of an Off-site Proposal Participation in the off-site project will allow the City to recover the costs associated with the development of excess affordable housing units in the Villa Loma Project . . The Villa Loma Apartment Complex has locational advantages over the on-site project in terms of direct access to jobs, public transportation, schools, parks as well as other amenities and services due to the complex being located directly on a major thoroughfare. Advancing HousinP Goals and Stratepies Recovery of the City's investment in the Villa Loma Project will provide for additional financial resources which are needed to further affordable housing development in the community. CT 98-05 - DE JONG DECEMBER 10,1998 IV. RECOMMENDATION Based upon the analysis of the above criteria, the Affordable Housing Policy (staff) Team believes that adequate justification has been provided by the Developer to make the finding that the off-site satisfaction of the inclusionary housing requirement is in the public interest. Therefore, the staff team is recommending that the request to purchase credits be recommended for approval by the Housing Commission. V. EXHIBITS 1. 2. 3. Draft Affordable Housing Agreement Housing Commission Resolution No. 98-016 Applicant Request to Purchase Credits 2 c 4 C E 7 a 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOUSING COMMISSION RESOLUTION NO. 98-016 A RESOLUTION OF THE HOUSING COMMISSION OF THE CITY OF CARLSBAD, CALIFORNIA, TO RECOMMEND THAT THE CITY COUNCIL APPROVE A REQUEST BY THE AIUE DE JONG, JR. FAMILY TRUST, TO PURCHASE 4.2 AFFORDABLE HOUSING CREDITS IN THE VILLA LOMA HOUSING PROJECT IN ORDER TO SATISFY THE AFFORDABLE HOUSING OBLIGATION OF THE DE JONG PROJECT UNDER THE CITY'S INCLUSIONARY HOUSING ORDINANCE. APPLICANT: ARIE DE JONG, JR. FAMILY TRUST CASE NO: CT 98-05 WHEREAS, THE ARIE DE JONG, JR. FAMILY TRUST, has made application for Tentative Map CT 98-05 within the City of Carlsbad for the development of a 28 unit residential subdivision; WHEREAS, the subdivision of land for 28 residential units requires the developer to provide 4.2 units of housing affordable to lower income households as required by Carlsbad Municipal Code Section 21.85 of the City's Inclusionary Housing Ordinance; WHEREAS, the Villa Loma housing project was conceived and developed with City participation based on the creation of 184 excess affordable housing units which would be available to satisfy other developers inclusionary housing obligation; WHEREAS, THE ARIE DE JONG, JR. FAMILY TRUST, has requested to purchase Affordable Housing Credits as a means to satisfy their affordable housing obligations as permitted by Carlsbad Municipal Code Section 2 1.85 of the City's Inclusionary Housing Ordinance and consistent with City Council Policies 57 and 58; WHEREAS, the request to purchase Affordable Housing Credits has been submitted to the City of Carlsbad's Housing Commission for review and consideration; WHEREAS, said Housing Commission did, on the 10'" day of December, 1998, hold a public meeting to consider said request for the purchase of Affordable Housing Credits by THE ARIE DE JONG, JR. FAMILY TRUST; WHEREAS, at said public meeting, upon hearing and considering all testimony, if any, of all persons desiring to be heard, said Commission considered all factors relating to the application and request to purchase Affordable Housing Credits; NOW, THEREFORE, BE IT HEREBY RESOLVED by the Housing Commission of the City of Carlsbad, California, as follows: r 1 z L C * E 7 e 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1. The above recitations are true and correct. 2. The project is consistent with the goals and objectives of the City of Carlsbad's Housing Element and Consolidated Plan, the Inclusionary Housing Ordinance, and the Carlsbad General Plan. Based upon the analysis contained within the Housing Commission Staff Report, the Housing Commission finds that the off-site satisfaction of the inclusionary housing requirement is in the public interest. That based on the information provided within the Housing Commission Staff Report and testimony presented during the public meeting of the Housing Commission on December 10, 1998, the Commission recommends that the City Council APPROVE a request by THE ARIE DE JONG, JR. FAMILY TRUST to purchase 4.2 affordable housing credits in the Villa Loma housing project in order to satisfy the affordable housing obligation of the De Jong project under the city's inclusionary housing ordinance. That the Housing Commission recommends that the Community Development Director be authorized to execute the Affordable Housing Agreement in substantially the form presented in Exhibit 3 to the Housing Commission Staff Report and to execute such other documents, or take other actions as may be necessary or appropriate to assist the developer in acquiring the Affordable Housing Credits. 3 . 4. 5. General Conditions: 1 . Within sixty (60) days of the City Council approval of Developer's request to purchase Affordable Housing Credits, and prior to receiving Final Map approval, Developer shall execute this Agreement and prior to the issuance of a building permit purchase 4.2 Housing Credits. Execution of this Agreement by the parties and payment of the required fee to the City by the Developer shall hlly satisfy the Developer's affordable housing obligation pursuant to Chapter 21.85 of the Carlsbad Municipal Code and the above- referenced conditions of approval. Upon execution of this Agreement and receipt of the above payment from developer, City will record an appropriate release of the developer's obligation. PASSED, APPROVED, AND ADOPTED at a regular meeting of the Housing Commission of the City of Carlsbad, California, held on the 10th day of December, 1998, by the following vote, to wit: AYES: NOES: ABSENT: ABSTAIN: KATHLEEN DU"-WELLMAN, CHAIRPERSON CAFZSBAD HOUSING COMMISSION DEBBIE FOUNTAIN HOUSING AND REDEVELOPMENT DIRECTOR HC RES0 NO. 98-016 -2- - Exhibit 2 Arie de Jong 622 East Mission Road San Marcos, Calajbrnia 92069 ' October 15, 1998 his. Deborah K. Fountaiq Housing and Redevelopment Director City of Carlsbad ' . 2965 Roosevelt Street, Suite B , Cdsbad, CA 92008~2389 '. Subject: de Jig Property'- Request to Purchase Off-site' Afford'able Housing Credits ... ... ... . __ . .. 1 ... ,. .. 1.. ..... , i ....... _I .. . , ._ ' Deal. 'Mi.' Fount .. ,.:,.. .. .. .. . ._ , . ~. .i, -. This lctter r..;'' sehes I, ,-..>,,+ as .-. \--.. a formal -7:- ,l\.,.. .request by the Arie de Jong, 'Jr. &imily Trust to purchase off-site (CT 98-05} %clL6ona$ houih@o6l;gatio& '.XSr''uest %''in komplimce tvith.actions previously affior&&&m@~ .. '&;&e yiah&a de$&$mht $0 &fisfy .&& & $i>ng 'property. @&~sion's , . .:<... .-., r' I.. (*''-' pa,*..;; ,-.,, a , ... I. ,, ,, .. taken by the City Council: ' : " . .:- . *. . ; ! :. .1,.. .;*.. ., , The City's inclusionary Ho&g Ordinance (CMC Chapter 21.85) establishes certain requirements under which residential developers must provide housing thrit is affordable to lower-income households,as a condition of project approvaI an@ permit isstlance. The ordin,ance provides that "circumstances may arise' in which the public .interest would be served by,al'locving some or all ,of the inclusionary &its associated .I with one project &et0 be prodiiced at an alternative . site or sites.'' The two inclusionary'h6using options that are available to a developer are that the developer s&ll either 1) enter into an agreement with the Citi to purchase affordable credits from ,Villa Lorna; or 2) participate in an off-site combined ' er.21.85'0ftbe Carlsbad.:. .. est Quadrant and as appfipriate, in mniission,that projected the inclusi he Southwest Quadrant of the Ci examined whether projected development of the Quadraxit could result in a demand for off-site credits. exceeding the nurnkr of available credits in the Villa Lorna project. The analysis showed that there are sufficient excess units (credits) to satisfy the potential demandof the Quadrant. Printed on Recycled Paper ? In the case of the de Jong project, there are particular circumstances that wmt the provision of the inclusionary units off-site in combipation with the existing Villa Lana Apartment project, pursuant to Council Policy 57 criteria. Significant feasibility issues affect the development of this project on- site. Contribution to the existing off-site project versus providing a, small (4 unit) low-income apartment complex on-site will result in increased public benefit, by returning funding currently tied up in the Villa Loma project for use in other affordable housing activity, We understand tlis request will be evaluated by a Staff Project Review Committee to determine compliance with the citeria defrned in Policies 57 and 58. It is also understood that staff will then take * the Committee’s recommendation to the Housing Commission md City Council. Please call if you need additional information or if we may be of ahy other assistance. I ’ I Mr. fuieYde Jong Tnistee Arie de Jong, Jr. Family Trust , Epc 10s Lire cc: Mr. Jack Henthorn, Jack Henthorn & Associates Mr. Craig Ruiz; Housing and Redevelopment Department . i DE JONG COMPARATIVE PRO FORMA REVENUE ANALYSIS 1 BEDROOM 2 BEDROOM 3 BEDROOM RENT UNITS REVENUE $695 1 $695 $888 2 $1,776 $1,062 1 $1,062 4 $3,533 95% OCCUPANCY $3,356 OPERATING COSTS @ 30% ($1,007) NET OPERATING INCOME $2,349 DEBT SERVICE INCOME (1.2) $1,958 * Note: The remainder unit obligation of .2 will be met by purchase of offsite credits in the Villa Lorna project. INCOME SUPPORTED DEBT LAND DEVELOPMENT COSTS LAND ONSITE IMPS OFFSITE POINSETTIA LANE PUBLIC FEES DESlGNlCONSULTANTS IMPROVED SITE COST LAND CARRY 18M0 LAND DEVELOPMENT COST UNIT CONSTRUCTION COSTS UNIT SIZE SQUARE FEET (project) STRUCTURE COST $45.00 ON SITE INDIRECTS 10% STRUCT. OVERHEAD .04 MARKETING .02 CONSTRUCTION COSTS LOAN FEES .02 CONST FINANCING SUBTOTAL FINANCING PROJECT COST GAP $222,992 # lots 2 1 $194,000 $106,000 $25,600 $78,000 $35,000 $438,600 $29,100 $467,700 1 BR 2 BR 3BR 725 1700 1100 3525 $32,625 $76,500 $49,500 $158,625 $12,338 $17,544 $8,772 $1 97,279 $197,279 $4,460 $9,864 $1 4,324 $1 4,324 $664,979 $664,979 $441,986 $441,986 Developer land contribution $194,000 NET GAP Page 1 $247,986 1 PER UNIT NET GAP PER UNIT GROSS SUBSIDY DE JONG COMPARATIVE PRO FORMA $61,997 $1 10,497 10120198 i Page 2 DE JONG PROPERTY OFF-SITE AND COMBINED INCLUSIONARY HOUSING PROJECT ASSESSMENT WORKSHEET -- BACKGROUND The following background information is provided to assist you in your assessment. Own e r/A p p I i ca n t I n f o rm a t i o n : Owner/Applicant: Arie de Jong, Jr. Family Trust Attn: Mr. Arie de Jong 622 E. Mission Road c/o Hollandia Dairy San Marcos, CA 92069 760-744-3222 Applicant’s Representative: Jack Henthorn & Associates Attn: Mr. Jack Henthorn 5375 Avenida Encinas Suite D Carlsbad, CA 92008 760-438-4090 Off-sitelcombined Project Name: VILLA LOMA APARTMENTS Description of Project with lnclusionary Housing Obligation: De Jong Property, CT 98-05, is a proposed 30-lot, 28-unit, single family development located on a 33.4 gross-acre parcel with a 4.2-unit affordable housing obligation. On-site Affordable Housing Description: The de Jong Property Affordable Housing project would be a 4-unit multi-family, apartment project occupying two lots with units ranging from 1 to 3 bedrooms. The units would be offered in a maximum rent range which is affordable to households earning incomes of 80% of the Area Median Income. To achieve financial feasibility, the project would require a net subsidy of almost $248,000 (even assuming a fully constructed pad is provided by the developer and unit revenues are based on a 95% occupancy rate factor). Proposed Off-site Project Description: The Villa Loma project is a 344-unit apartment development in which all units are restricted and affordable to households with incomes not exceeding 60% of the San Diego County Median. Villa Loma was developed by La Terraza Associates, with Bridge Housing Corporation as the Managing General Partner. The complex contains 1 , 2, 3 &4 bedroom units. Villa Loma was financed with assistance from the City of Carlsbad and the Carlsbad Redevelopment Agency. The assistance was structured in such a way as to create affordable units which would be marketed exclusively by the City to “other developers” in order to satisfy an affordable housing obligation. The Villa Loma Apartment complex is a Combined Project according to the lnclusionary Housing Ordinance, and developers may participate in this as an “off-site” method of satisfying their affordable housing obligation. (This is also an approved site for the Greystone Cove and Ocean Bluff projects.) i 3 Participation in Villa Loma Apartments by the applicant would be in the form of a purchase of Affordable Housing Credits (Credits) under terms established by City Council Policies Numbered 57 and 58. If the applicant is afforded the opportunity to purchase Credits, the de Jong Property tentative map would require the purchase of 4.2 Credits to satisfy its inclusionary housing requirement. 6. Description of On-site Project Constraints: Specific constraints exist which would affect an on-site affordable apartment project's feasibility. These include the uneconomical small scale of the affordable project, the inconsistency in land use adjacent to single family detached residential uses, and a significant product type difference between the affordable rental units and the proposed single-family market units that will be developed in this project. i 4 DE JONG PROJECT OFF-SITE AND COMBINED INCLUSIONARY HOUSING PROJECT ASSESSMENT WORKSHEET --WORKSHEET 1. Feas ibility of the On-site Proposal . a. Are there significant feasib'lity I issues due to factors such as project size, site constraints, amount and availability of required subsidy, and competition from multiple projects that make an on-site option impractical? 0 The on-site affordable project is not of sufficient size to be a viable apartment project. Given the small size of the project and its restricted rental structure, onsite management and maintenance will be difficult. The small scale of the affordable housing project also makes it unlikely that the project will generate interest from funding sources. The market units in this project would be required to absorb over $6,900 per unit so that land value could be contributed by the developer. This figure would rise to almost $15,800 per unit if the applicant is required to build the units on site and close the post land development gap of almost $248,000. Based on the estimated restricted rental prices of the affordable units the applicant will be facing an average subsidy requirement of approximately $62,000 per unit, beyond land contributions. This would result in each unit being subsidized with approximately $1 10,500. 0 0 0 b. Will an affordable housing product be difficult to intearate into the proposed market development because of significant price and product type disparity? 0 Price disparities will be substantial between the low-income rental apartment units restricted at $695- $1,062 rent and the approved higher-end single-family detached homes which have an estimated base price range of $350,000 to $400,000. The integration of 4 affordable apartment units, sized at 725 to 1,100 sq. ft., into the single-family subdivision with homes of 3,000 to 3,500 square feet on 7,500 to 18,500 sq. ft. lots will result in major product type disparity on-site. The surrounding area will also be built-out with low density, single- family detached products consistent with the existing RLM land use designation and market demand. The on-site project would, therefore, also result in substantial product disparity with the surrounding development character. 0 c. Does the on-site development entity have the capac itv to de liver the proposed affordable housing on-site? 0 The applicant is not experienced in the development of affordable housing. Affordable housing developers have advised the applicant that it is unlikely that this size of project will generate interest from funding sources. 2. Relative AdvantaaeslDisadvantaaes of the Off -site Proposa 1, a. Does the off-site option offer greater feasibilitv and cost effectiveness than the on-site alternative, particularly regarding potential local public assistance? 0 0 Villa Loma is built and has proven its feasibility; no additional assistance is required. The applicant's participation in Villa Loma would permit the intended recovery of City investment provided to the project through utilizing "excess units". These funds could then be used to provide additional affordable housing. Conversely, the developer's on-site project would create the demand for additional new subsidy. 5 b. C. d. 3. a. 0 The small size of the on-site project could result in additional future subsidy requests related to operating costs. Does the off-site proposal have location advantaaes over the on-site alternative, such as proximity to jobs, schools, transportation, services; less impact on other existing developments, etc.? 0 The location of the Villa Loma development has advantages over the on-site project in terms of access to employment in the nearby industrial parks, public transportation, a library, schools, parks, as well as, other amenities and services due to being located directly on the major thoroughfare, El Camino Real. Villa Lorna is a self-contained affordable development in an area designated for higher density residential development such as condominiums and townhomes. The on-site proposal could be a source of land use conflicts that typically occur when higher density development is permitted adjacent to larger lot single family development. 0 Does the off-site option offer a development entity with the capac itv to de liver the proposed project? The Villa Lorna project is an existing project, developed and managed by a highly experienced and specialized affordable housing developer. Does the off-site option satisfy flultiple deve toper ob liaations that would be difficult to satisfy with multiple projects? 0 Villa Loma project was originally established as a Combined Project, specifically to address this purpose. The proposed on-site project would be one of several projects in the southwest quadrant competing for scarce financial assistance. Villa Loma has already been financed and built and thus, would not be competing for subsidy financing. Advancina Housina Goals and St rategy Does the off-site proposal advance andlor support City housing goals and policies expressed in the Housing Element, CHAS and lnclusionary Housing Ordinance? General Plan Housing Element and CHAS Goals: Villa Loma Apartment affordable project is targeted to the highest priority need identified, larger rental units for low income households. The recovery of the City's investment in the Villa Lorna Project through the applicant's participation will provide for additional resources which are needed to further affordable housing development. Villa Loma provides a large quantity and diversity of affordable housing stock with its 344 units, including a generous supply of different size units to meet various housing needs of the community. lnclusionary Housing Ordinance Policies: Consistent with the City and public interests to use existing "excess" affordable units before supporting additional new construction. In conjunction with the combined Villa Lorna project, the De Jong project will provide for 15% of the total units for affordable (lower income) residential units. The project also complies with the lnclusionary requirements as contained in the General Plan Housing Element. Growth Management Zone, Ord. No. NS-257 Guidelines: Villa Lorna is coordinated with surrounding properties by providing direct access to a major Circulation Element Roadway, El Camino Real, as well as circulation and pedestrian access to pbblic facilities. 6 .- TENTATIVE TRACT MAF DEJONG CITY OF CARLSBAD, CALIFORNIA RANCHO AgUA FDIONDA APN 216-08[ t MAP NO. 823 ?2 ---_ I APN 216-080-22 APN 216-080-04 SEE SHT. 3 FOR POlNSETnA LANE NOTES THlS AREA :ET 3 KEY MAP SCALE: 1”= 150’ Exhibit 3 RECORDING REQUESTED BY: City of Carlsbad WHEN RECORDED MAIL TO: City of Carlsbad City Clerk's Office Attn: Citv Clerk 1200 Carlsbad Village Drive Carlsbad, California 92008 (Space above for Recorder's Use) AFFORDABLE HOUSING AGREEMENT THIS AFFORDABLE HOUSING AGREEMENT ("Agreement") is entered into this 10* day of December, 1998, by and between the CITY OF CARLSBAD, a municipal corporation (hereinafter referred to as the "City"), and Western Pacific Housing for the AFUE DE JONG, JR. FAMILY TRUST., (hereinafter referred to as the "Developer"), is made with reference to the following: RECITALS A. Developer is the owner of certain real property in the City of Carlsbad, County of San Diego, State of California, described in "Attachment A", which is attached hereto and incorporated herein by this reference, and which is the subject of a Tentative Map (CT 98-05), which provides conditional approval of the construction of 28 single family dwelling units (Troject"). B. Condition No. of Planning Commission Resolution No. states that this Affordable Housing Agreement shall be entered into between the City and the Developer as a means of satisfying the Developers' affordable housing obligation ("Affordable Housing Obligation"), as such is defined under Chapter 21.85 of the Carlsbad Municipal Code. Planning Commission Resolution No. provides that the Affordable Housing Obligation of four and two tenths (4.2) units will be satisfied by applying the requirements set forth in this Agreement. NOW, THEREFORE, incorporating the foregoing Recitals and in consideration of the mutual covenants contained herein, the parties agree as follows: 1. THE RECITALS ARE TRUE AND CORRECT. 2. SATISFACTION OF AFFORDABLE HOUSING REQUIREMENTS THROUGH THE PAYMENT OF AFFORDABLE HOUSING CREDITS. (a) Performance under this Agreement satisfies the Developers' obligation for affordable housing under Chapter 21.85 of the Carlsbad Municipal Code as applied to the land covered by Carlsbad Tract No. 98-05 by reason of the approvals of the Tentative Map of CT 98-05, including and any other applicable Condition No. listed in Planning Commission Resolution No. approval. (b) The Developer shall pay for four and two tenths (4.2) Affordable Housing Credits as established by the City and as required by Condition No. - of Planning Commission Resolution No. . The fee shall be paid prior to the Developer receiving a building permit for the project. 3. REMEDIES Failure by the Developer to perform in accordance with this Agreement will constitute failure to satisfy the requirements of Chapter 21.85 of the Carlsbad Municipal Code and Condition No. - of Planning Commission Resolution No. - . Such failure will allow the City to exercise any and all remedies available to it including but not limited to withholding the issuance of building permits for the lots shown on Carlsbad Tract No. 98-05. 4. HOLD HARMLESS Developer will indemnity and hold harmless (without limit as to amount) City and its elected officials, officers, employees and agents in their official capacity (hereinafter collectively referred to as "Indemnitees"), and any of them, from and against all loss, all risk of loss and all damage (including expense) sustained or incurred because of or by reason of any and all claims, demands suits, actions, obtained, allegedly caused by, arising out of or retaining in any manner to Developers' actions or defaults pursuant to this Agreement, and shall protect and defend Indemnitees, and any of them with respect thereto. Developer shall obtain, at its expense, comprehensive general liability insurance for development of the ($ 1,000,000) purchased by the Developer from an insurance company duly licensed to engage in the business of issuing such insurance in the State of California, with a current Best's Key Rating of not less than A-V, such insurance to be evidenced by an endorsement which so provides and delivered to the City Clerk prior to the issuance of any building permit for the Project. 5. NOTICES All notices required pursuant to this Agreement shall be in writing and may be given by personal delivery or by registered or certified mail, return receipt requested to the party to receive such notice at the address set forth below: TO THE CITY: City of Carlsbad Housing and Redevelopment Department Attn: Housing & Redevelopment Director 2965 Roosevelt Street, Suite B Carlsbad, California 92008-2389 TO THE DEVELOPER: Arie de Jong, Jr. Family Trust. Attn: Arie de Jong c/o Hollandia Dairy 622 E. Mission Road San Marcos, California 92069 Any party may change the address to which notices are to be sent by notifying the other parties of the new address, in the manner set forth above. 6. ENTIRE AGREEMENT This Agreement constitutes the entire agreement between the parties and no modification hereof shall be binding unless reduced to writing and signed by the parties hereto. 2 7. DURATION OF AGREEMENT This Agreement shall terminate and become null and void upon the payment of the Affordable Housing Credits, or the repeal, termination, or modification of any applicable ordinance which act would render the Affordable Housing Obligation unnecessary or unenforceable. 8. SUCCESSORS This Agreement shall benefit and bind the Developer and any successive owners of Affordable Housing Lots. 9. SEVERABIlLITY In the event any provision contained in this Agreement is to be held invalid, void or unenforceable by any court of competent jurisdiction, the remaining provisions of this Agreement shall nevertheless, be and remain in full force and effect. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed as of the day and year first above written. DEVELOPER CITY Arie de Jong, Jr. Family Trust By: (Name) By: (Title) APPROVED AS TO FORM: City’of Carlsbad, a municipal corporation MARTIN ORENYAK Community Development Director RONALD R. BALL CITY ATTORNEY 3 ATTACHMENT A LEGAL DESCRIPTION OF SUBJECT PROPERTY